March 4th - 2005

Legal Beat: Not liable for sewer

A home the buyers purchased was described in an MLS listing as being connected to the city sewer system. In fact the home turned out to have a septic tank.

A home the buyers purchased was described in an MLS listing as being connected to the city sewer system. In fact the home turned out to have a septic tank.

Even the previous owners of the property were unaware of this and throughout this time they and the buyers were billed by the city as if the property had been connected to the municipal sewer line.

Ten years after the purchase, the buyers experienced a problem in the home with slow drainage. The plumber advised them to check with the city first, to see if there was a problem with the sewer line. City workers attended to check on the problem and performed three dye tests; the workers then suspected that the property was probably not on the city system. They were able to perform an historic search and then discovered that the property was not connected to the sewer line.

The Buyers said that the misrepresentation was negligent and that the REALTOR ought to have checked his facts before including the information in the listing. The REALTOR argued that they were not liable because they met the standard of care imposed upon them at law. The Judge said, "A REALTOR has a duty to disclose all material facts known to him or her which could affect a reasonable purchaser's willingness to enter into an agreement of purchase and sale. The listing REALTOR's duty is normally satisfied, however, by making inquiries of the vendor and of other sources readily available to him or her (as, for example, by making reference to information available in the realty office concerning previous transactions involving the same property). In the absence of some reason to doubt the accuracy of the information thus obtained, however, it is not incumbent upon the REALTOR to inspect the premises or independently verify what he or she has been told. It must be remembered, after all, that the rule of caveat emptor (buyer beware) is still very much alive in this country, perhaps especially in cases involving real estate transactions."

Gilchrist v. Centre City Real Estate Inc., 2003 BCPC 356

MERV'S COMMENTS
The judge found that the buyers did not prove that the REALTOR was negligent in its representation about the state of the sewer line. The buyers did not show that the REALTOR failed to meet the standard of care required by law. It was not reasonable for them to rely on the statement in the listing without verification of the information important to them. The REALTOR met the usual standards of the profession and the Code of Ethics.

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