Ontario law makes a distinction between patent defects – problems with a home that are easily observable to the untrained eye, and latent defects – problems that are not easily observable or even detectable, even by an expert.
A patent defect could be a large, visible crack in a foundation wall, a broken staircase, or missing bathroom fixtures, to give a few examples. Patent defects are visually obvious, so you aren’t required to disclose them to potential buyers. It is their responsibility to inspect the property.
Latent defects are a different story. As a seller, you are required by law to disclose any known latent defects that could make your home dangerous or unfit for habitation. Examples of latent defects could include a basement that floods during heavy rainfalls, a structural problem with a wall or a chronic mould outbreak. If a seller knows about a latent defect that makes the home dangerous or unfit for habitation and fails to disclose it, they put themselves at risk of being sued by the buyer.
Keep in mind that while your Real Estate Agent is required to follow your instructions, they must also follow a Code of Ethics that forbids them from knowingly misrepresenting the state of your home if they are asked a direct question about it.
If you are unsure about your obligations relating to disclosures, you should always contact a legal professional to discuss your options.
Latent defects include but are not limited to:
Structural problems, roof leaks, mechanical or electrical deficiencies, past basement water damage, mould, insect infestations, hazardous material (e.g., asbestos, aluminum or knob-and-tube wiring, lead-based products, galvanized or Kitec plumbing, UFFI insulation), soil contamination, abandoned underground oil tanks, discrepancies in measurements cited in listings or reports, previous use of a property such as a grow-op, previous crimes that were committed on the property or deaths other than natural deaths.
Thank you for taking the time to read this article. I hope you found it helpful.