RE/MAX West Realty Inc., Brokerage *

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Lien on Title: Can the Buyer Sue?

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Lien on Title: Can the Buyer Sue?


Is the Buyer entitled to sue the Seller, if there is a lien on title?


The Buyer can sue, anyone can, for anything. The real questions is whether the Buyer would be successful.

Let’s have a look at the standard Form Agreement of Purchase and Sale.

This is what the title clause says:

“10. TITLE:

Provided that the title to the property is good and free from all registered restrictions, charges, liens, and encumbrances except as otherwise specifically provided in this Agreement and save and except for (a) any registered restrictions or covenants that run with the land providing that such are complied with; (b) any registered municipal agreements and registered agreements with publicly regulated utilities providing such have been complied with, or security has been posted to ensure compliance and completion, as evidenced by a letter from the relevant municipality or regulated utility; (c) any minor easements for the supply of domestic utility or telecommunication services to the property or adjacent properties; and (d) any easements for drainage, storm or sanitary sewers, public utility lines, telecommunication lines, cable television lines or other services which do not materially affect the use of the property.

If within the specified times referred to in paragraph 8 any valid objection to title or to any outstanding work order or deficiency notice, or to the fact the said present use may not lawfully be continued, or that the principal building may not be insured against risk of fire is made in writing to Seller and which Seller is unable or unwilling to remove, remedy or satisfy or obtain insurance save and except against risk of fire (Title Insurance) in favour of the Buyer and any mortgagee, (with all related costs at the expense of the Seller), and which Buyer will not waive,

this Agreement notwithstanding any intermediate acts or negotiations in respect of such objections, shall be at an end and all monies paid shall be returned without interest or deduction and Seller, Listing Brokerage and Co-operating Brokerage shall not be liable for any costs or damages.

Save as to any valid objection so made by such day and except for any objection going to the root of the title, Buyer shall be conclusively deemed to have accepted Seller’s title to the property.”

Certainly, the intention is to provide the Buyer with the opportunity to walk away with their deposit, but not claim any damages or other compensation.

If there’s a lien, and it can’t be resolved, then the Buyer has the right to declare that the Agreement is “at an end” and receive the deposit.

Brian Madigan LL.B., Broker

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