# Verbal Agreement When Purchasing Property



## Alberta (Mar 5, 2017)

Hello, this is my first post, so I apologize if it is in the wrong section. 

I purchased a piece of property with someone years ago, and we had a verbal agreement that it was a 50-50 split on ownership. The actual deed is only in my name, and their name is nowhere in any official document. Now, they only gave a few thousand (it was less than $5,000), and the property value hasn't increased at all. They keep harassing me to put their name on the deed - legally speaking, what are my options? Do I have to? Could they bring me to court? They won't agree to me buying them out for what they paid, and I don't want to have them on the deed.

Thanks for your help.


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## Spudd (Oct 11, 2011)

I think you need to talk to a lawyer for this one.


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## Just a Guy (Mar 27, 2012)

Verbal agreements are technically binding and have been upheld in court.


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## OhGreatGuru (May 24, 2009)

_They keep harassing me to put their name on the deed...._ It's hardly harassment if they are trying to get you to make good on the original agreement.


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## Just a Guy (Mar 27, 2012)

The fact that you accepted payment, regardless of the amount, signifies your agreement to the verbal contract as well and fulfills the legal requirements of a contract.


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## RussT (Jul 11, 2016)

I had thought verbal agreements were not valid when dealing with real estate (at least in Ontario), but I may be mistaken.


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## Just a Guy (Mar 27, 2012)

Copied from a legal site...

Canadian Contract Law - What Constitutes a Contract

Contract: 
An oral or written agreement between two or more parties which is enforceable by law. In order to be valid, a contract requires an offer, an acceptance of that offer and, in common-law jurisdictions, consideration.

Consideration: 
Under common-law, one of the three criteria that have to be met before a contract is binding. Refers to money or payment of money or some right, interest, profit or benefit accruing to the one party, or some forbearance, detriment, loss or responsibility given, suffered or undertaken by the other.

Offer

An offer must be a clear, unequivocal and direct approach to another party to contract. For this reason, advertisements, and catalogues are not offers. The law calls these "invitations to treat"; or invitations to the general public to make an offer on a particular item.

An offer, once made, can be revoked before acceptance unless it is under seal. An offer can also expire if a deadline for acceptance passes. If there is no specified deadline, then the offer expires in a "reasonable time", depending on the subject-matter of the contract.

Acceptance

It is at this moment that a contract exists. The acceptance must be clear, unequivocal, unconditional and made by the person to whom the offer is intended.

Consideration

Consideration: 
Under common-law, one of the three criteria that have to be met before a contract is binding. Refers to money or payment of money or some right, interest, profit or benefit accruing to the one party, or some forbearance, detriment, loss or responsibility given, suffered or undertaken by the other.

There is one exception to the requirement of "consideration" and that is a "deed", which is a contract "under seal" or a "specialty contract". Deeds are used mostly in contracts that involve real estate. If a contract is a "deed", then no consideration is required.

Looks like the person is just trying to acquire their promised "deed" to me.


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## Rusty O'Toole (Feb 1, 2012)

You made an agreement and took their money, now it is up to you to live up to it even if you don't feel like it. If you made the agreement in front of witnesses, and they kept the cancelled cheque they can definitely sue and win.

If you changed your mind I have one suggestion. Put a price on the property, or half the property, and tell them you will buy their half or sell your half at that price, their choice. Or give them the opportunity to set the price and you can take it or not.

OK 2 suggestions. You say the value has not gone up. Sell them your half at what you paid and go buy something else.


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## Mukhang pera (Feb 26, 2016)

Alberta said:


> Hello, this is my first post, so I apologize if it is in the wrong section.
> 
> I purchased a piece of property with someone years ago, and we had a verbal agreement that it was a 50-50 split on ownership. The actual deed is only in my name, and their name is nowhere in any official document. Now, they only gave a few thousand (it was less than $5,000), and the property value hasn't increased at all. They keep harassing me to put their name on the deed - legally speaking, what are my options? Do I have to? Could they bring me to court? They won't agree to me buying them out for what they paid, and I don't want to have them on the deed.
> 
> Thanks for your help.


The recital of facts is a bit sparse.

A few questions come quickly to mind:

1. Purchased "years ago". How many? There is a potential limitations issue for bringing an action.

2. How is it title ended up in your name alone? I take it the contract with the vendor was with you alone as purchaser and you agreed with your "friend" to cut him in. 

3. Were you to make equal contributions? You say "they only gave a few thousand". Did you "give" more? Did they "give" what they agreed to give? It sounds like you might well be in breach of contract for failing to share title, but perhaps they are in breach by not paying all they agreed to pay, excusing you from performance.

4. Was there financing? Who made the monthly payments, if any?

5. Who has paid taxes and any other carrying costs over the years? What was agreed in that regard?

6. Why is it you "don't want to have them on the deed" if that is what was agreed?

7. What was the purchase price and, again, who has contributed how much? What is at stake here? 

8. Why do you seek to avoid performance if, as you suggest, the property has been a dog from an investment point of view?

"Could they bring me to court?" Yes, of course. Whether doing so would be practical is another issue.




RussT said:


> I had thought verbal agreements were not valid when dealing with real estate (at least in Ontario), but I may be mistaken.


RussT has it right, at least in part. I don't know if the OP "Alberta" is in Alberta and I do not profess to know Alberts law, but a requirement for land sale contracts to be in writing is common. In some provinces it will be found in the "Statute of Frauds", now called the Law and Equity Act in B.C. Its relevant provision (with italics added) is:

Enforceability of contracts
59 (1) In this section, "disposition" does not include
(a) the creation, assignment or renunciation of an interest under a trust, or
(b) a testamentary disposition.
(2) This section does not apply to
(a) a contract to grant a lease of land for a term of 3 years or less,
(b) a grant of a lease of land for a term of 3 years or less, or
(c) a guarantee or indemnity arising by operation of law or imposed by statute.
(3) _A contract respecting land or a disposition of land is not enforceable unless_
(a) there is, in a writing signed by the party to be charged or by that party's agent, both an indication that it has been made and a reasonable indication of the subject matter,
(b) the party to be charged has done an act, or acquiesced in an act of the party alleging the contract or disposition, that indicates that a contract or disposition not inconsistent with that alleged has been made, or
(c) the person alleging the contract or disposition has, in reasonable reliance on it, so changed the person's position that an inequitable result, having regard to both parties' interests, can be avoided only by enforcing the contract or disposition.
(4) For the purposes of subsection (3) (b), an act of a party alleging a contract or disposition includes a payment or acceptance by that party or on that party's behalf of a deposit or part payment of a purchase price.

The disappointed partner here has a good argument under ss. 3(b) that his payment of purchase money is an indicator of a contract being on foot. Subs. 3(b) appears to be a statutory incorporation of the "doctrine of part performance" explained succinctly by the B.C. Court of Appeal here:

http://www.courts.gov.bc.ca/jdb-txt/CA/11/04/2011BCCA0430.htm

See para. 5-6.


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## Mukhang pera (Feb 26, 2016)

Rusty O'Toole said:


> If you changed your mind I have one suggestion. Put a price on the property, or half the property, and tell them you will buy their half or sell your half at that price, their choice. Or give them the opportunity to set the price and you can take it or not.


This is not a bad idea. Close to what is oft called a "shotgun clause" - buy or be bought out at the offered price. I am not surprised the other side does not want to accept Alberta's offer, which sounds like an offer to return the other guy's money, presumably without interest, so he has to accept depreciated dollars.


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## Mukhang pera (Feb 26, 2016)

Expecting too much, I suppose, for the OP to return to this thread after more than one member here suggested that he should keep his word.


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## YYC Condo (Jun 16, 2017)

*Verbal Parking Spot Permanent Trade Agreement*

I purchased a condo with a parking spot 6 years ago. The day I took ownership, one of the other owners in the building approached me to permanently trade our parking spots, because he was in a wheelchair and needed a none covered spot, to accommodate his wheelchair van, and he would never be able to fit his van into the garage. He has recently passed away, and now the new owners feel entitled to my current parking stall. Their unit has come with two parking spots one in the garage and the verbal agreement to the one outside, that I had permanently traded with the previous owner. Now I have parked in the garage stall since the first day I purchased this property which is 6years ago. Could anyone please provide legal requirements, regulations, laws, rights, example court cases, etc. that I would be able to use to my defence. Thank you.


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## twa2w (Mar 5, 2016)

I think you are out of luck unless you have some paperwork to back it up. You should have traded titles on the parking spot if they are titled spots. If they are not titled spots, you should have at least registered the change with the condo board.
An agreement like the one you had does not survive the death of one of the parties.
I am not a lawyer so take this with a grain of salt.


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## YYC Condo (Jun 16, 2017)

*Verbal Parking Spot Permanent Trade Agreement*

The Condo Board did know about the change. The new owners have lived here for 2 months and now all of a sudden they want to change.


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## twa2w (Mar 5, 2016)

Are the parking spots titled, or just assigned by condo board.?did the condo board formally agree to trading the spots associated with your condos or were they just made aware the two of you were trading? What province are you in? If the agreement is not in writing it likely has no validity when in comes to real estate.


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## Mukhang pera (Feb 26, 2016)

YYC Condo said:


> I Could anyone please provide legal requirements, regulations, laws, rights, example court cases, etc. that I would be able to use to my defence. Thank you.


Without knowing your province, we are really in the dark.

But, in any event, your situation is one unlikely to be covered by provincial law and I would not expect to see many court cases dealing with an issue like this. I have read almost every judgment from every court in B.C. since January 1982 and I cannot recall anything with a similar fact pattern. What will more likely govern are the bylaws of the strata corporation (or whatever it is called in your jurisdiction). 



YYC Condo said:


> The Condo Board did know about the change.


Here, what we refer to as the "strata council" usually administers the bylaws of the strata corp. What the council "knew" won't count for much unless that knowledge was recorded in meeting minutes or some such formal record. If the council formally approved a swap, with no time limit, then the trade is likely permanent. 

As twa2w points out, if the stalls are titled and recorded in the Land Title Office, and if a transfer was appropriately registered, then that's the end of the matter.

FWIW, here is one case I turned up which, while not on all fours with your situation, gives some idea of how these things go:

REAL PROPERTY — Condominiums — Strata councils — Duties and liability — • Common property — Use • EQUITY — Equitable doctrines — Laches • ESTOPPEL — Equitable estoppel — In 2007 respondent’s strata council approving petitioner’s request for permanent exchange of parking stalls — In 2011, new council re-assigning petitioner to his original stall, saying that under Strata Property Act, s. 76, council having no authority to grant a permanent exchange of parking spots — Court finding the 2007 council had authority to exchange, given that the parking stalls were subject to a long-term lease and given the assignment agreements giving strata council authority to deal with parking — In the alternative, court finding petitioner entitled to relief under s. 164, or under doctrine of laches or equitable estoppel.

When the petitioner and his spouse purchased a residential condominium in 2006, they also purchased a second parking stall. The parking facilities were subject to a long-term lease agreement entered into between the developer and a numbered company; the numbered company assigned two parking stalls to the petitioner’s spouse. In November 2007 the strata council unanimously approved the petitioner’s request for an exchange of one of the parking stalls. In 2011, a new council, relying on s. 76 of the Strata Property Act, concluded it had no authority to grant a permanent exchange of parking spots and re-assigned the petitioner his original stall. The petitioner sought a declaration that the 2007 agreement between himself and the respondent was valid and enforceable. *HELD*, for petitioner. The strata council had the authority to assign the petitioner the new parking stall on a permanent basis. The issues surrounding the assignment of parking stalls were governed by and subject to the assignment agreements which provided the strata council authority to deal with parking, even though parking stalls were designated as common property. The assignment of the new parking stall was pursuant to the lease and assignment agreements and as such was not a temporary or a short-term use decision subject to the provisions in s. 76, under which the respondent could cancel permission given under the authority of s. 76. The assignment was valid and enforceable as against the respondents, and there would be a declaration to that effect. In the alternative, it would be appropriate to declare the actions of the council in 2011 revoking the 2007 agreement to be “significantly unfair” under s. 164 of the Strata Property Act. The petitioner had a reasonable expectation that he would be entitled to permanently use the newly assigned parking stall. The petitioner used that particular spot for approximately three and a half years without any suggestion that he was acting improperly. In the circumstances, the action by the strata council in revoking the permission that the 2007 council gave the petitioner to exchange parking stalls was inequitable. In the further alternative, this would be an appropriate case to apply the doctrine of laches or equitable estoppel, as the respondent had clearly “acquiesced in the existence of a situation and not asserted its right for some period of time”.

Jacobucci v. Strata Plan BCS 1299, S.C., B.D. MacKenzie J., Doc. 2012 BCSC 1399, Vancouver S115095, 3/9/2012

It's a short case - only 8 pages - full text here:

http://www.courts.gov.bc.ca/jdb-txt/SC/12/13/2012BCSC1399.htm


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## Just a Guy (Mar 27, 2012)

What does the condo board say about this? Why does the new owner think he's entitled to the original spot? Usually, condo boards either assign stall (non-electrified) or the electrified ones are tied to a specific unit (because the power goes to that unit). In the former case, when you "swapped", he condo should just have changed their records and then any new owner would be told of the assignment going forward. If it's in he latter case, then the "swap" may have been considered temporary, because they can't formally change something tied to a specific property.

Either way, this is something a condo board, or more likely the property manager would sort out and their rules are usually fairly binding as they are managing the entire property and things like you're describing can cause no end of chaos if freely allowed.


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## YYC Condo (Jun 16, 2017)

*Verbal Parking Spot Permanent Trade Agreement*

Thank you for the replies. I am located in Calgary Alberta.


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## YYC Condo (Jun 16, 2017)

*Verbal Parking Spot Permanent Trade Agreement*

The stalls are not titled. The unit that is requesting the spot is referencing the 1950's developer assigned parking document. I am not sure if this was ever recorded at the board meetings. I will search for them, since this was 6years ago.


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