2. Duty to inform

Adverse factors: Specific cases relating to the history of the immovable

2.1 Description sheet

2.2 Adverse factors

2.2.1 Declarations by the seller

2.2.2 Specific cases relating to the history of the immovable

a) Death or suicide in the property

b) Property used to grow cannabis

2.2.2 Specific cases relating to the history of the immovable

Although under the Civil Code certain factors may not represent a latent defect that can undermine the integrity of an immovable, a licensee must inform the parties to the transaction about their existence.

The importance of a factor depends on each person according to his values, perceptions, religion, age, etc. Certain events can be related to a property without specifically affecting its appearance, quality or functionality, for example, an owner who is suspected of being a member of a criminal organization, a death on the property, a property which has been vandalized, presence of an unexplained phenomenon or a house used to grow cannabis, even if it has been restored.

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a) Death or suicide in the property

The seller's broker who is informed that there has been a death in the property must disclose it, whether or not it is a violent or accidental death.

This can be a factor that can affect the transaction for some prospective buyers. It is not the licensee's responsibility to decide whether or not the information is relevant. His duty to inform is to disclose any factors that could affect a prospective buyer. And it is up to that buyer to decide whether or not this information affects his interest in the property. This will allow him to make a free and informed decision.

The licensee must also disclose a death that occurred outside the home, such as in the shed, in any other dependencies or on the lot itself that is part of the immovable. This information must be recorded on the Declarations by the seller of the immovable form in clause D14.3 for a violent death or suicide and in clause D14.5 for death (specify if possible in D15).

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b) Property used to grow cannabis

The Cannabis Act (federal law), the Cannabis Regulation Act and the and the Act to constitute the Société québécoise du cannabis, to enact the Cannabis Regulation Act and to amend various highway safety-related provisions (provincial law) are intended to regulate the production, possession, and use of cannabis. These federal and provincial statutes and related regulations came into force on October 17, 2018.

These statutes and regulations have impacts on the practices of brokers who must ask more questions, perform further verifications and disclose information in order to properly advise consumers when buying, selling or leasing an immovable. 

Given the extent of the damage that excess humidity can cause to buildings, real estate brokers must take special steps when selling, buying or leasing immovables that have been used or could be used for growing cannabis.

The seller's broker must, as part of his duty to verify, check previous description sheets and the Seller's Declarations forms available on the information listing service and the documents attached to them.

The fact that a house has been used to grow cannabis, regardless of the number of plants, is an adverse factor that must be disclosed when known. The licensee must therefore make sure that this information is entered on the DS (DSD) form and add any relevant information. This is a factor that could have an impact on the buyer’s decision. 

Remember that in Québec, it is forbidden to have in one's possession a cannabis plant or to grow cannabis for personal use in a home.¹

In cases where cannabis cultivation is authorized for medical purposes, the licensee will need to obtain the appropriate certificate and disclose its existence to the buyer in order to provide complete and transparent information.

He must also advise the buyer to have an inspection and further air and mould testing done.

It is not always public knowledge that a house has been used to grow pot. Accordingly, the licensee must pay special attention to the indicators relating to the immovable and those pertaining to certain aspects of the transaction itself. Here are some crucial elements that can guide brokers in their verifications.

Clues related to the immovable

The damage caused to the immovable by cannabis cultivation is not always apparent and work may have been done to repair or conceal it.

However, there may be indications that the property has been used to grow cannabis. Here are some clues:

• The home is put back on the market very quickly
• The home has very little furniture
• Electricity bills are high or show a significant variation
• Electric meter has been tampered with, e.g. roof mast has been sectioned before the meter
• New roof mast
• Signs of high humidity, including in attic space (wet insulation, blackened roof truss)
• Ice forms outside vents or chimneys
• Presence of dehumidifiers in unusual and inappropriate locations
• Traces of humidity in fireplace
• Signs of corrosion on electrical outlets or switches, metal post bases, etc.
• Spongy floors
• Perfume to mask the smell of rot
• Lifted wallpaper or peeling paint
• Newly painted ceilings and window frames
• Need to measure ambient humidity rate (with bulb hygrometer) or in walls (with hygrometer)
• Very strong, unusual smell
• Mould spores forming on north wall or in unventilated spaces (mould is caused by the presence of humidity, heat and cellulose [wood, cardboard, skin])
• Mould stains on walls; repaired holes about a foot in diameter in closet floors and ceilings, basement dividing walls or near roof mast
• Drywall bulging, recessed nails in ceiling
• Chimney not connected in the attic

The seller's broker who identifies one or more of these clues in the property must question the seller and make additional verifications by directly contacting the criminal division of the courthouse of the region concerned.

The same applies to the buyer's broker who must also advise his client to conduct expert assessments to measure the air quality and the presence of mould. 

Clues related to the transaction

Clues related to the transaction serve to identify an immovable intended for a grow-op. Since licensees play a central role in any real estate transaction, they are in the best position to observe these clues and advise their selling clients to act with prudence. The most common clues are:

• Date of signing of the deed of sale on the promise to purchase is far into the future with pre-occupancy
• The purchase or lease is done by a third party or under an assumed name
• Single-level house with attached garage purchased as an investment property
• Buyer lives out of the country or province
• Cash deposit may be high
• A deposit is done in cash or through a buyer’s broker
• Unusual financing sources
• Mortgage approval subject to signing of leases
• Buyer does not negotiate
• Buyer does not have the building inspected by a building inspector or does not seem to care about the size of the rooms or other features, but does care about the electricity, the size of the garage and basement
• Buyer has recently been involved in several transactions
• Transaction is notarized separately, i.e. the parties do not meet.

The seller's broker who identifies one or more of these clues must advise his client not to accept a "pre-occupancy", a distant date for the signing of the deed of sale or a lease-to-own,  in order to avoid ending up with a contaminated property before the signing of the deed of sale, while the buyer and/or tenant have disappeared.        

For leases

For leased properties, the licensee will need to verify the leases and let his client know if the consumption of cannabis is prohibited. 

• Current lessee: 
  • Since the coming into force of the Act on October 17, 2018, a lessor has 90 days to add a clause to the lease prohibiting the smoking of cannabis on premises.
  • Since January 15, 2019: the lessor may only amend a lease in the same way and within the same time constraints as apply to any other amendment.
• New lessee: 
  • The lessor will be allowed to include a clause prohibiting the smoking of cannabis when signing a new lease.

For co-ownership properties

In order to properly inform his client, the licensee will have to review the syndicate of co-owners’ by-laws. These by-laws could restrict or prohibit the consumption of cannabis in various forms, despite the fact that it is now legalized. Where appropriate, the licensee must inform any prospective buyer and verify the co-ownership’s incorporation act, by-laws or co-owners’ agreement and be aware of any amendment made up to the signing of the deed of sale.

Note that on April 14, 2023, the Supreme Court of Canada (PDF) upheld the validity of the provincial law which, unlike the federal law, does not provide for any exceptions and prohibits cannabis cultivation in homes. Thus, in Québec, it is forbidden to have in one's possession a cannabis plant or to grow cannabis for personal use in a home.

¹ Murray Hall vs. Québec (Attorney General) 2023 CSC 10; s. 5, 10 of the Cannabis Regulation Act (CQLR, c.C-5.3).

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