Mr. Lachance loves his new home. Settled in just over a year ago, he decided to remodel the basement. When he made an opening in a wall covering the foundation, he discovered that the concealed materials were completely rotten. Water infiltration seems to be responsible for the damage. What should Mr. Lachance do now? Who should he contact? Is this a hidden defect? Read our article to find out more about the role and the importance of a building expert when faced with a hidden defect situation.

Let’s emphasize from the outset that the advice we share here comes from the experience of our technical experts, who are often called upon to work on legal expertise cases. Naturally, the following advice does not constitute a legal opinion for a situation that may concern you specifically.

First step in dealing with hidden defects: denounce the situation and put him on notice

Now back to poor Mr. Lachance. His basement wall is open, and the water infiltration is clearly visible. What should he do about it? Although he doesn’t yet know whether or not it’s a latent defect, the first legal step, according to articles 1739 and 1594 of the Civil Code of Quebec (CCQ), is to report the situation to the former owner within a reasonable time. Although it is not necessary to call on the services of a lawyer, the denunciation stage involves certain particularities for which legal advice could prove beneficial and enable Mr. Lachance to avoid pitfalls that could undermine an eventual lawsuit. In addition to the legal requirement to notify the former owner, the law also requires the current owner to allow the seller to carry out the work required to restore the building (mise en demeure), except in certain emergency situations clearly defined by jurisprudence, without which the owner’s recourse will have no chance of success.

This formal notice can be sent even before the exact source of the problem or the defect affecting the building is known. Of course, Mr. Lachance may opt to call his seller first to inform him of the situation. However, if the parties are unable to come to an agreement, a written document must be sent within a reasonable period of time, with proof of dispatch. Once the call has been made to the former owner, and even before the necessary notices have been sent (notice of latent defect and formal notice), Mr. Lachance can move on to the next step: contacting a building expert.

Second step in dealing with hidden defects: Contact the building expert

Like an investigator worthy of the great TV series, the expert must carry out a thorough investigation of the damage. His job is to determine whether the conditions, i.e. the defect, that led to the problem found by Mr. Lachance existed at the time of the real estate transaction, whether there were indications of the situation during the pre-purchase or pre-sale inspection, and whether the work required will prove costly. He will carry out his work with complete impartiality, with the aim of getting to the bottom of the situation and never showing favoritism.

The first document the expert will examine is the pre-purchase inspection report ordered by Mr. Lachance during the home-buying process. He will check to see if the inspector raised any concerns and/or indications about the potential presence of water behind a basement wall and its repercussions. In such a case, if Mr. Lachance had ignored the inspector’s recommendations to investigate further, it would have been difficult for him to sue both the seller and the inspector.

Next, the expert will look at the water infiltration itself. He’ll assess the extent of the damage, trace it back to its source and identify its causes. His experience and knowledge will enable him to distinguish between the normal obsolescence of a component and a hidden or apparent defect. He will determine whether the conditions causing the problem were present at the time of the real estate transaction, and whether any signs were visible during the pre-purchase inspection.

Finally, the expert will establish the cost of corrective work to see if the hidden defect, had it been known at the time, would have led to substantial negotiations or been a reason to terminate the transaction.

Once the expert has completed his investigation and calculations, he will produce a report detailing his work, the tests carried out and the conclusions reached. This report can then be used by Mr. Lachance and his lawyer for further action.

Third step of dealing with hidden defects: Contact a specialist lawyer

If this has not already been done, it is strongly recommended that Mr. Lachance consult a lawyer at this stage. With the expert’s report in hand, the lawyer will determine whether Mr. Lachance has sufficient arguments to initiate legal proceedings, and against whom, if anyone, these proceedings will be directed (seller, inspector, broker, etc.). He will work with the appraiser to understand the entire case and determine whether there is a latent or apparent defect. He will accompany Mr. Lachance in issuing a formal notice if he has not already done so, and in all subsequent steps, in addition to accompanying and advising him during the mediation process with the seller. If mediation does not result in an agreement, he will determine in which court the lawsuit will be heard, depending on the amount of the claim. For example, if the amount claimed for the latent defect is $15,000 or less, the case will be heard before the Court of Quebec, Small Claims Division.

What happens next will depend on a number of factors. The defendant may wish to settle the dispute out of court, undertake the remedial work himself, or defend his case and involve his own expert and lawyer in the matter. Whatever the situation, Mr. Lachance’s expert and lawyer will be there to guide and advise him.

We remind you that the information presented in this column is provided for informational purposes only. It does not constitute legal advice and should not be construed as such. You’ll understand that every case is different. If you or a loved one is experiencing a latent defect in your home, only a consultation with a court-approved expert or a lawyer can help you decide what to do next. Visit our legal expertise page to see how our experts can support you throughout the legal process