REIX’s post Disclosing Suicides and Violent Crimes, dated September 15th, says that “while there is no law, or statute requirement, that requires disclosure, there is no question that you must disclose it.”
REIX would like to issue a clarification pertaining to the above. While it is not required that real estate agents must disclose whether a violent crime has been committed on a property, as your insurer, we recommend that it be disclosed to avoid potential lawsuits, and to make it easier for us to defend you in legal actions that arise from issues such as this.
Please see below for the updated blog post.
As real estate agents, you’re often faced with difficult decisions – least of all what you should and shouldn’t disclose.
So it’s no surprise that we’re often asked if suicides and violent crimes that occur on properties should be disclosed.
REIX recommends that best practice is to disclose it.
While there is no law, or statute requirement, that requires disclosure, REIX recommends that you disclose it to avoid any potential lawsuits. Without intending to be funny, if you don’t make the disclosure, the neighbours most assuredly will and likely on the day the buyer moves in.
It is advised that an industry member should handle situations like this with tact, sympathy and above all, diplomacy.
So how and when should the matter be disclosed and what do you do to protect both yourself and the other parties to the transaction?
How and When to Disclose
If you’re representing both the buyer and seller, then you should make the disclosure before you write the offer, adding a note in your file indicating the date, time and person(s) to whom you made the disclosure.
If you’re only representing the seller, then the disclosure is made to the buyer’s real estate agent, either before the offer is written (if you are aware in advance that an offer is coming) or before the offer is presented.
Again, ensure you have a note in your file that indicates the date, time and person(s) you made the disclosure to.
Addendum Recommended
Finally, we recommend an addendum be written up and included as part of the purchase contract. It should say something to the effect of “seller has disclosed and the buyer acknowledges that they have been informed of a suicide/violent crime on this property.”
By dealing with suicides and violent crimes in this way, you are being sensitive to the seller’s needs, informative to the buyer’s needs, and protecting both yourself and the parties to the contract from liability arising out of the failure to disclose.
The Real Estate Insurance Exchange (REIX) provides mandatory errors and omissions insurance to over 14,800 Alberta and Saskatchewan real estate industry members and nearly 1,200 brokerages. We’re dedicated to providing high value to our subscribers through exceptional claims, risk and financial management. Be sure to follow us on Facebook!