If you’re going to buy or sell real estate in Alberta one simple rule is that everything must be in writing. The Statute of Frauds requires that any contract relating to land be in writing. For example, in business you can make an oral contract or shake on it, and that “contract” could be held up in a court of law, but if it relates to land it must be in writing.

That brings us to the purchase contract that the buyer and seller must have whenever land transfers hands. We will repeatedly reference the purchase contract developed by the Alberta Real Estate Association (AREA) which includes mandated content from the Real Estate Council of Alberta (RECA), which is used by members of AREA (REALTORS®). The contract is designed to be neutral – fair to both the buyer and the seller.  

Neutrality doesn’t necessarily mean that it is completely fair.  In my mind completely fair would mean every single advantage is negotiated by the parties, or there is complete neutrality.  For example, the contract I use refers to the seller providing a Real Property Report (RPR) with evidence of municipal compliance within a certain time frame.  If it was completely neutral the parties would share the cost of the RPR.  If it was to the seller’s advantage they wouldn’t have to provide an RPR or provide any warranties on it whatsoever.  In order for commerce to be effective standardizations can be required so that things can proceed past grid locked negotiations. 

It is a common misconception that if the seller is offering to include something with the sale of the home on the listing (ie. appliances), then it is automatically included in the sale. However, if the appliances are not written into the purchase contract, the seller is under no obligation to include the appliances in the sale, as they are not securely attached to the property. “Everything in writing” means everything! If the buyers want the carpets cleaned before possession, they have to put it in writing. An experienced REALTOR® will have had countless experiences relating to these different clauses, and the different situations that may apply. 

Even though contracts are intended to be fair, the end result is based on what is negotiated and what is written into the contract. It is up to you figure out the nuances and how they can affect you.  And remember….put it in writing!

–>Next…The Title to Your Property