Judge challenges property disclosure forms

Yukoners preparing to buy or sell a home may want to give a moment of pause before they pick up a property disclosure statement. These forms, commonly used to describe the condition of homes across the country, are "legal mi

Yukoners preparing to buy or sell a home may want to give a moment of pause before they pick up a property disclosure statement.

These forms, commonly used to describe the condition of homes across the country, are “legal minefields,” according to Judge Michael Cozens.

In particular, Cozens found the forms are ambiguous as to whether they are to describe past, as well as present, damage to a home.

Cozens reached this conclusion in small claims court last month when awarding damages to a couple who had purchased a home with a leaky roof from Gary and Trudy Burdess of Whitehorse. In the end, Cozens ordered the Burdesses to pay ,818.15 to cover the cost of fixing the roof of a house at 4 Firth Road they had sold to Lyle and Glenda Bowers.

During the trial, Gary Burdess insisted he had no knowledge of the leaky roof. He stated that he believed any water damage inside the house had been due to condensation problems, and that he believed these problems had been fixed.

That’s why he indicated that he was unaware of any water damage on the disclosure statement.

Cozens didn’t buy it. He noted that even after tenants began using a dehumidifier, water continued to leak through the master bedroom’s light fixture. Such a leak had existed for several years. And, prior to selling the home, the owners painted over a water stain near the fixture.

The Bowers only learned about the leak from a neighbour after they had purchased the home.

There was no evidence to suggest that Dean Philpott, the Re/Max realtor who represented the Burdesses, knew the house’s roof leaked. He only had a short discussion with the Burdesses about the water problems. He had asked if they were sure the problems had been fixed. They told him yes.

Cozens raised several objections to the way property disclosure statements are written. He suggests they should make clear whether they refer to past or present problems. He also suggests the legal implications of the forms are not clear to the people who use them, and that realtors should fix this.

As for the Burdesses, Cozens suggested that, even if they believed the problems had been fixed, they should still have disclosed their past water problems on the form. The current practice of realtors is to recommend to only disclose damage that presently exists.

Terry Bergen, president of the Yukon Real Estate Association, said, “We take what the judge said very seriously,” but he doesn’t believe there’s any problem with property disclosure statements.

If anything, the case shows such documents do their job, he said.

“The recommendations don’t have much to do with this case; this case is pretty cut and dried,” said Bergen.

But, to be safe, the association will ask for advice from the Canadian and BC real estate associations, said Bergen.

Yukon uses the same property disclosure statement as BC.

“A lot of lawyers have pored over it,” said Bergen. “As soon as you change one thing, you create some other problems. And we’re a very small jurisdiction. If we were to do a change, we’d need to get a legal opinion, and who’s to say whether that legal opinion is better than the 15 legal opinions before?”

“BC probably has 1,000 court cases for every one we have.”

Contact John Thompson at johnt@yukon-news.com.

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