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Thursday, June 21, 2012

Commercial immovable or enterprise: mandatory statements in any brokerage contract or transaction proposal | OACIQ

Commercial immovable or enterprise: mandatory statements in any brokerage contract or transaction proposal | OACIQ


Commercial immovable or enterprise: mandatory statements in any brokerage contract or transaction proposal

Article Number: 121346
June 20, 2012 - 12:16
The OACIQ did not publish any mandatory forms for brokerage contracts and transaction proposals concerning an immovable containing five dwellings or more, a commercial or industrial immovable, an enterprise or a vacant land. However, brokers should include in the contract or transaction proposal the mandatory statements set out in the regulation. If they wish, brokers may also use the OACIQ recommended forms which are designed to address certain situations and which include the mandatory statements listed below. In all cases, broker’s obligation to provide the parties concerned with a completed and signed copy of any contract or transaction proposal applies.
The mandatory statements for any brokerage contract regarding the sale or lease of an immovable containing five dwellings or more, a commercial or industrial immovable, an enterprise or a vacant land are the followings:
1) The identification and contact information of the parties;
2) The subject and term of contract;
3) The identification of the immovable or features of the immovable sought;
4) The price and terms of sale, purchase, exchange of the immovable or enterprise or lease of the immovable;
5) The broker or agency remuneration method and payment conditions of this remuneration;
6) The possibility for parties to resort, in case of a dispute, to the services of conciliation, mediation, and arbitration of accounts offered by the OACIQ in accordance with the Real Estate Brokerage Act;
7) Any other right or obligation of parties;
8) Any other statement complying with the provisions of the Real Estate Brokerage Act.
The statements which must also be contained in such a contract, where appropriate, are the exclusivity of the contract, the fact that in some cases the contract cannot be terminated and the description of the enterprise to be sold, if applicable.
In the same way, the new regulation imposes a mandatory minimum content for anytransaction proposal regarding the purchase or lease of an immovable containing five dwellings or more, a commercial or industrial immovable, an enterprise or a vacant land. Here are the statements that should be contained therein:
1) The identification and contact information of parties;
2) The subject of transaction proposal;
3) The identification of the immovable and description of the enterprise, if applicable;
4) The price and terms of purchase, sale, exchange of the immovable or enterprise or, as the case may be, lease of the immovable and the amount of the down payment deposited in the broker’s or agency’s trust account in accordance with the terms provided for the trust, if applicable;
5) The payment method of purchase, sale or exchange price, including, as the case may be, the payment terms of additional funds, new mortgage loan, assumption of obligations related to existing mortgage loans and selling price balance;
6) The terms and conditions regarding the signing of the deed of sale, lease or exchange contract by the parties;
7) The fact that any declaration by the seller or lessor on the immovable or enterprise made prior to the transaction proposal constitute an integral part thereof;
8) The acceptance conditions of transaction proposal, particularly the date and time of its expiry;
9) Any other right or obligation of parties;
10) Any other statement complying with the provisions of the Real Estate Brokerage Act.
Finally, it should be noted that although the Declarations by the seller of the immovable form of the OACIQ does not constitute a mandatory annex in cases of brokerage contracts regarding the sale of an immovable containing five dwellings or more, a commercial or industrial immovable, an enterprise or a vacant land, the broker’s obligation to recommend to the owner of the immovable to provide his declarations about the immovable remains.