March 8th - 2007

Merv’s column: Multiple representation tricky

The buyers met with the agent, SP, when they became interested in purchasing a lot.

The buyers met with the agent, SP, when they became interested in purchasing a lot. They wanted to live close to the city but not in the city, since property taxes in the city were too high. In response to a question, SP estimated taxes at $2,400.00 per year. This was in the summer of 2002. When the home was completed and the first tax bill arrived for the full house and land tax, the amount was $3,186.88.
 
As a result of complaints and inquiries, it came to light that in 1992 when sewer and water was installed in the community each owner was offered the option of either paying for the improvement at that time or having the amount of $337.50 added to the tax bill each year for 20 years. The agent said that most residents opted for the annual payment.
 
The judge noted that the buyers purchased a lot using SP as their agent (she was also the agent of the vendor who is her father). The buyers said that they made inquiries as to improvements and were told that sewer and water was available for all property in the community. They claim that they were never told there would be an annual assessment for sewer and water until 2012.
 
"Ms P was representing both vendor and purchaser and certainly had an obligation to make complete and total disclosure especially since the vendor was her own father. In response to questions in cross-examination she does not appear to have any tax information that she says disclosed the amount of the improvements – further she also does not have any documentation that provides the acknowledgement of both vendor and purchaser that they knew that she was acting on both sides of the transaction as an agent."
 
The judge ruled in favour of the buyers in the amount of $337.50 per year for a term of 10 years or $3, 375.00.

Montour v Century 21 Carrie Realty Ltd 2006 MBQB 97

MERV'S COMMENTS
Tell the whole truth– especially in a dual agency situation. It also might not be wise to try to represent the buyers and your father/seller at the same time.

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