It’s Closing Day! At 8:45a.m., I get a text from my Seller: “So hey – our dryer stopped working this morning. We just used it yesterday, today there is something wrong with it. What’s the protocol for that?”
“Unless otherwise stated in this Agreement or any Schedule hereto, the Seller agrees to convey all fixtures and chattels included in the Purchase Price free from all liens, encumbrances or claims affecting the said fixtures and chattels.“ This particular clause is on the standard form of the Agreement of Purchase and Sale used by members of the Ontario Real Estate Association. Note that it does not guarantee the condition of the chattel.
Chattel related conditions that can be included in the Schedule A section of an offer are:
- The Seller represents and warrants that the chattels and fixtures as included in this Agreement of Purchase and Sale will be in good working order and free from all liens and encumbrances on completion.
- The Seller warrants that all the mechanical, electrical, heating, ventilation, air conditioning systems, air compressors, elevators, conveyor systems, sprinkler systems, boilers, and all other equipment on the real property shall be in good working order on completion.
In a hot market with competing offers, a buyer may choose to throw caution to wind by minimizing or even eliminating all conditions and warranties in an offer to win favour with the seller. This was exactly that type of situation, a contract of sale with no clause stating the sellers warranty on the condition of the appliances.
In a land of negotiations and contracts, a moral dilemma arises.
Fortunately most people just want to do what is right and fair and it just comes down to integrity and being a good neighbour. In spite of all the stresses of moving, my sellers stepped up to the plate and at the last minute, found a repair man to replace the burned out thermostat on the dryer. By 1pm I was able to see them off to start their new life in another province, and we all lived happily ever after!
Chattels are included in most commercial and residential Real Estate Transactions. Residential transactions will often include: fridge, stove, washer, dryer, dishwasher, garden shed, all window coverings and all light fixtures and ceiling fans. I have done transactions that have also included a billiard table, a tractor, barn cats, bales of hay and stacks of firewood! I have on a couple of occasions also had over eager first time home buyers who wanted furnishings and dishes. My advice to buyers is to stay focused on first negotiating for the property. If the listing includes appliances etc, that is fine to include them in your offer. If not, sometimes it is just better to negotiate purchasing items from the seller after an offer becomes firm and binding.
Conversely the Seller who decides to just leave the pool table behind as a gift to the Buyer may not necessarily be well appreciated. I have seen closings delayed because the Seller has failed to vacate all belongings.
A good practice when including appliances in an Agreement of Purchase and Sale is to record as much information as possible (make, model, serial number) onto the agreement particularly if they are newer and valuable. Taking pictures of the appliances is a good practice also. Unfortunately appliances have been known to get swapped out for cheaper models.
A seller may choose to exclude some appliances or parts of the property which will be communicated in the listing and acknowledged by both parties in the Agreement of Purchase and Sale. An exclusion can be practical or sentimental. I have had sellers exclude a chandelier that was their family heirloom, another couple excluded a kitchen door that had come from their family farm. Many sellers will opt to exclude their appliances as they were recently purchased or in the case of having expensive appliances, excluding them could be a strategy to keep the property price down. If there is a fixture that is screwed down or “permanently” fastened to the property that you don’t want included in the sale of your property, make sure that your Realtor has noted it as an Exclusion in the listing.
Lee J Talbot
Real Estate Sales Representative