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| Special Assessments for Condo Under Sale | mg |
| If a condo owner is informed of a special asessment fee and is selling their unit, they can pay the fee, or adjust the sale price of the unit to cover the cost. That is straight forward, but when when notice of a special assessment fee is received too late to adjust the sale price, or to make some agreement with the buyer, a slop of legal soup may ensue. Ideally time and circumstance will allow the seller and buyer to reach an agreement, but there surely are times when that can not or does not happen.
The status certificate will allow the buyer to become aware of the fee, so both parties will always have the means to become aware of any special assessment fees owing. And both parties can initiate an agreement as to who pays. But both parties may not wish to address this, prefering to assume the other pary will pay. Silly - but it happens. So what is the correct action? Apparently the law is mostly grey on this issue. One perspective is that, with the notice of fees being received near the time of sale and the work being incomplete, or not have commenced, the seller is in no position to benefit from the work. Whereas the buyer, who will benefit from the work, will likely have the perspective that the fee was hidden, and therfore not their responsibility. Does the industry have any standards in approaching these situations? |
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| ORIGINAL POST | Posted At: 2009-11-11 11:16:33 |
| Tracey McLellan | |
| Hi mg,
I am assuming based on your e-mail that both parties would be aware of the assessment. There is no "standard" way of handling these situations. It is an individual negotation between the parties involved. It is no different than say, deficiencies from a home inspection. The purchaser can request an adjustment of the sale price based on the inspection, or they can accept the deficiencies and make the fix out of their own pocket. A special assessment is treated no differently, it is up to the parties involved to act on the advice of their lawyers to determine how far they are willing to negotiate payment of the special assessment |
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Posted At: 2009-11-20 08:43:51 | |
| Richard | |
| If the special assessment is disclosed in the status certificate, the buyer can decide to walk, or they parties can agree to procede and adjust the price.
If the fee is not disclosed in the status certificate, the buyer and the unit are exempt. If the assessment was planned for months and not disclosed, things get very complicated. Whether the amount is recovered from the board or management that did not disclose it is unknown. |
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Posted At: 2009-11-23 20:21:46 | |
| Okay how messy? | Daniel |
| You mentioned that if the assessment was planned for months but not disclosed it could be messy. How messy? I am in that situation. The Stat Cert indicated everything was fine, but I learn that one of the units has been complaining about a mold issue for over a year, and then a Special Assessement was levied a 2 months after purchasing the home.
Since the Corporation and board are not directly liable for the status certificate would I have to sue the previous home owner? Could title insurance be used? |
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Posted At: 2010-07-23 15:25:46 | |
| Richard | |
| If you are holding a status certificate that does not disclose the special assessment, you are exempt from those fees.
By not disclosing it --- the corporation cannot levy it against the new owner. Remember the "good faith" provision? Title insurance will not help with contamination issues. Lawyers should stop selling it and go back to searching titles and doing the jobs they are paid to do, instead of just selling insurance. |
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Posted At: 2010-07-28 06:39:48 | |