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Factors that may affect the decision of a buyer

Factors that may affect the decision of a buyer

Article Number: 120651
February 1, 2012 - 11:33


All brokers have the obligation to inform the parties engaged in a transaction of any known factor that may adversely affect buyers or sellers or the very object of transaction.

However, the importance of a factor depends on each person according to his or her values, perceptions, religion, age, etc. Certain events can be related to a property without specifically affecting its appearance, quality or functionality; for example, an owner who is suspected of being a member of a criminal organization, a death on the property, a property which has been vandalized, presence of a ghost according to occupants, a house used to grow cannabis, but having been restored and approved by an authority.


Brokers’ obligation towards buyers is clear on this subject. The aim is to make a disclosure of absolutely anything that may influence the decision or conduct of a prospective buyer after his or her verifications.

Once a broker has knowledge of a factor which may adversely affect a buyer, regardless of the source of information, he or she must inform the buyer about it, after making his or her diligent verifications.

A broker is even required to be proactive i.e. he should not wait for the buyer’s questions in this regard. After all, the buyer has no reason to think of such a situation or ask questions about it. Note also that the information must be disclosed no matter when or where on the property the event took place.

One of the main roles of a broker is to protect his client’s interests and to disclose to the buyer any information that may assist him in making a better decision. To fulfill this role, the broker must particularly question the seller about this subject when the brokerage contract is taken up and advise him to disclose it on the Declarations by the Seller form, which he will complete with him.

The seller must also be advised that his broker has an ethical obligation to disclose this information to any interested buyer or to the broker representing such buyer, before a promise to purchase is signed.

Although under the Civil Code certain factors may not represent a latent defect that can jeopardize the integrity of an immovable, a broker has ethical obligations under the Real Estate Brokerage Act, especially concerning his duty to advise and inform.

This duty is notably set forth in section 85 of the Regulation respecting brokerage requirements, professional conduct of brokers and advertising, which states that a broker must inform the buyer of any “known” factor that “may” adversely affect the parties or the object of the transaction (section 85). Consequently, a broker must “objectively” advise and inform the buyer about all the facts surrounding the transaction and the object thereof, without ''exaggeration'', ''concealment'' or misrepresentation'' (sect. 83).

To conclude, transparency is required in all circumstances. This practice helps maintain and reinforce public’s trust in the profession, giving it an added value.