Were the buyers selective or fair? Real estate contracts are very important and everyone needs to read the finer details. When a Port Moody builder said thousands were kept away from the sale price, the British Columbia Supreme Court was asked to consider the matter.
The owners of a luxury home overlooking Port Moody’s Inlet have won their claim to keep five percent of their $3.25 million purchase price after a British Columbia Supreme Court judge ruled they needed the money to make repairs.
The outstanding funds, totaling $176,250, have been held in a trust since the purchase of the custom Ioco Road home in April 2021.
Meanwhile, builders said the buyers had broken the contract they signed and that keeping the ban would be “unfair” and “oppressive” since many of the deficiencies have been fixed and those that remain could cost up to $40,000.
Pedram Hakimishukati and Azam Rafie Moin also argued that the terms of the contract were “contradictory” as they called for fixing the deficiencies and not changing the house either.
However, in a May 16 ruling, Judge Elizabeth MacDonald agreed with buyers that the contract clearly established sellers’ responsibility to fix all deficiencies within 14 days.
Buyer wanted “best finishes”
Judge MacDonald acknowledged that the builder and the buyer disagreed over the number of problems and the cost of repair.
However, she noted that if the builder did not agree to the contract, they should not sign it.
“After reviewing all evidence, I agree that, as of 14 days after the end date, there were a number of items on the shortfall list that remained outstanding as described in the home inspector’s supplemental report dated May 15, 2021,” Justice MacDonald texts in the ruling.
“With Mr. Hakimishukati’s evidence, he has only narrowed down the list of shortcomings and there are still some items that remain outstanding.”
The judge noted that the buyers were intending to purchase a “newly constructed luxury property with the best finishes” and that the sales contract provided for a reservation in case of deficiencies.
Inspection of the house after signing the contract found 60 defects, laid out on 100 pages, but even after the sale closed two months later, an inspection of the last 10 items hanging from the shortage list found, including marks on the marble kitchen countertop, warped cabinet doors and gaps in baseboards that required Dam.
The disruption funds are kept in trust to fix construction deficiencies
The new homeowners also expressed concern about settlement cracks in various locations within the house, which the builders denied.
Evidence provided in an email also showed that the builders dropped the home’s selling price by $25,000, in an appendix to the contract, after citing deficiencies.
Among the shortcomings noted at the time were the lack of safety rails around the pool deck and certain areas of basement ceiling heights of less than eight feet, which limited the couples’ plans for the basement to an open plan design.
However, the arbitrators noted that the owners were keen to ensure the new home met expectations and backed it with a contract.
The judge acknowledged that for the builders, losing the restricted money was difficult.
“There is some evidence that plaintiffs made efforts to repair some of the items on the deficiencies list. There is also some disputed evidence that the cost of repairing the remaining deficiencies is much less than the defect.”
The judge further wrote: “However, I cannot find the impediment to be an ‘exorbitant and unreasonable’ amount.”
“Given the outstanding deficiency items, the defendants were placed in the unenviable position of having to either live with the deficiencies or do the repairs themselves. This is the likely scenario that the deficiencies provided for and because of that, it is hard to see why they should not That the parties abide by their deal.”
It ordered the release of outstanding funds to buyers, and suggested that court costs could be dealt with at a later time.