What is a hidden defect in real estate?

Buying a house, condo, or rental property is an important milestone in life. However, this experience can quickly become a source of frustration when a hidden defect is discovered. Here is a simple and practical explanation to understand this concept, its implications, and the available recourses.

What is a Hidden Defect?

A hidden defect is a serious flaw that affects a property to the extent of making it unusable or significantly reducing its functionality.

To qualify as a hidden defect, the flaw must meet the following conditions:

• Hidden: The defect must not have been apparent or detectable during a reasonable inspection by the buyer before the purchase.

• Existing Before the Sale: The defect must have existed before or at the time of purchase, even if its effects only become apparent later.

• Serious: The defect must be significant enough to diminish the property's value or usability.

• Unknown to the Buyer: The buyer must not have been aware of the defect's existence.

  
  

Common examples of hidden defects:

• Cracks or foundation problems

• Water infiltration

• Presence of mold

• Structural defects in the building

• Major electrical or plumbing issues

  
  

The Legal Warranty of Quality

When a property is sold, the seller is automatically bound by the legal warranty of quality, unless a specific clause excludes it. This warranty obligates the seller to address hidden defects that render the property unfit for use or reduce its value.

What to Do If a Hidden Defect is Discovered?

If you discover a hidden defect after the purchase, follow these steps:

1. Notify the Seller: Inform the seller in writing as soon as possible. Clearly and thoroughly describe the problem and invite them to have the issue evaluated by a professional of their choice, at their expense.

2. Evaluate the Defect: Consult an expert to confirm the nature and severity of the defect. Obtain a detailed estimate for the necessary repair work.

3. Send a Formal Notice: If no agreement can be reached with the seller, you may send them a formal notice letter. In this letter, reiterate the defect, include the expert reports and repair estimates, and request a sum to cover the necessary repairs or, in severe cases, demand the cancellation of the sale.

4. Legal Action: You have three years from the discovery of the defect to file a claim with the Tribunal. If your claim is $15,000 or less, you can file it with the Small Claims Division.

   
   

Conclusion

A hidden defect can be challenging, but Quebec law provides mechanisms to protect buyers. Whether you are a buyer or a seller, understanding your rights and obligations is crucial.

At NDB Services Juridiques, we are here to assist you with your legal proceedings and defend your interests. Don’t hesitate to contact us for advice suited to your situation!