Or FOR most people, the buying or selling of a home is by far the most important financial transaction they will ever make. This is especially true on the North Shore where we are renowned for both high mountains and high housing prices (unlike Whistler where it is the mountains, the hous- ing prices and the people that are high). : igh In light of this I thought I would devote a couple of columns to legal issues that prospective buyers and sellers of homes should be aware of. Now before you turn the page and go to the “News of the Weird,” let me say that I know that no one enjoys reading absut Segal issues. But as your mother used to say when she forced rnedicine down your throat, it is for your cwn good. _/, Anyway, we are only going to look at some of the key legal issues surrounding real estate — it would be impossi- “ble to cover them all. - “ Realtors have whole books on real estate legal issties and I gine lawyers have entire on the subject. So it isn’e feasible for the average person, who only makes 2 few real estate transactions in his - fife, to be aware of all the. — _legal ins-and-outs of this body aw. . “' However it is important to tearn about the more impor- tant issues, or at least the ones “that can get you into trouble. if your understanding of them is incomplete or crroncous. - . Is preparing this colunin i talked with Steve Turner, 3 lawyer with Ardagh Hunter ‘Turner,’a local legal firm that 2." does a lot of real estate work on the North Skore.- . According to him, onc issue that buyers should have a good understanding of is the use of subject clauses in a contract of purchase and sale, A subject clause is a candi- tion that is written into a seal estate contract and must be satisfied before the deal can be completed. For example, a buyer may make an offer on a house subject to selling his own property first. A time limit of say, 60 days, would be art of this condition and the uyer would have to remove this condition within the 60 days or else the contract would be cancelled. Nowadays, virtually every offer to purchase has a subject clause on financing and also one on inspection of the property. Some people have the impression that subject clauses such as these can be used as “escape clauses” to get out of a contract if they decide they don’t want to buy the property any more. While sometimes a buycr might get away with doing this, it is a risky strategy as it pecs against the intent of the aw. - With respect to subject clauses, the law says thst a . party has a duty to apply his “best efforts” to remaviog the subjects in a contract. Ifa purchaser, who made an offer conditional'on financing, said he couldn’s get ’ financing just because he. wanted to get out of the deal, hen he could be sued if the vendor could establish that, Friday, November 26, 1999 — North Shore News ~ 87 BEFORE buying or selling a home it’s important to familiarize youresif with some of the fegal issues that are involved, such as subject ciauses. =~ 7 a a the financing was indced available to him. It is worth neting that the buyer’s liability is not limited to the deposit, which would likely be at least 5% of the rice of the property. In fact «¢ could be successfully sued for the seller's actual damages or for specific performance of “ the contract, at is the cours could foree the buyer to com- plete the deal... - A further note to this is shat a buyer should not put in a subject clause that is vaguc and that depends primarily un his own discretion. Such sub- jects have the wonderful name ATA GLANCE... socence NUMBER OF BEDROOMS: 5 cases NUMBER OF FLOORS: 3 veecneccovcressscee ASKING PRICE: $645,000 eoneevece of “whim and fancy” clauses, An example would be a clause that says thar the contract is “subject to the purchaser arranging a mortage.” Such a clause basically leaves the purchaser with the discretion to arrange a mortgage or not, depending on whether or not she wants the deal to go through. The problem with this is thae the courts have decided that a vendor can declare a contract with such a clause. void because the subject puts _the contract at the “whim and fancy of the purchaser.” The way to avoid this situ- ation is to draft a clause on financing that specifies all the details of the financing includ- ing the interest rate, principal, term and amortization of the mortgage and the amount of the monthly paymeuts. Such a financing clause is much less subjective and would make it easier for the courts to deter- mine if a third party would or would not have been willing to grant the financing. If you are going to put a - subject clause in an offer, it is “ bnportant that it be drawn up: properly so that it will accom- plish what you want it to and if will not be scen‘as a “whim _. Happiness is and fancy clause.” : ’ For this purpose your Realtor has access to ohrases and clauses that have been drafted by experts in B.C, real estate law. He or she should also have 2 good understand: ing of how to incorporate there clauses into the contra of purchase’ and sale so that- they address the condition and yet do not compromise the legality of the contract. =~ Trent Appelbe estite agent and an econamtst,.. sith Re/Max Crest Réalty, He: can be reached at.988-4797 er by e-mail at . ___ 4825 Meadfeild aN a quiet tree canopied street where children play on the sidewalk and neighbours know each other, by name Family values are found in this 4 bedroom home with private master. snsuite on the main floor, 2 cezy:gas eoesnesncce - fireplaces, home office and ~~. versatile floorplan. A famil with french doors leads. onto a . professionally - gardens. Relax on.the front porch - while your children walk home from | Ceulfeild'. Elementary or. Rockridge Middle schcal. A fenced - rool tandscaped ~ OPEN HOUSE: Sunday 2 - 4 TING AGENT: Leanna Doane 377-1779 cell backyard, playhouse, huge rainy day basement, teen suite and . plenty of stdrage for bikes and skis - are. waiting. for you. ; Reasonably .