Real estate arbitrage

Method for resolving disputes between a seller and a buyer.

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More and more, real estate sales contracts contain arbitration clauses. These clauses allow parties to avoid going to court in the event of a conflict between the parties to a sales agreement.

Arbitration takes the form of a private tribunal where the case is heard by one or more arbitrators chosen by the parties.

To initiate the process, the parties must send an arbitration request to the arbitrator. Upon receiving this request, the arbitrator prepares an Arbitration Agreement that must be signed by all parties.

The arbitrator then determines the procedure. Parties are free to be represented by a lawyer and present their own expert witnesses. Once the proceedings are complete, the arbitrator issues a written decision that is binding on the parties. This decision can be enforced by a court in case of non-compliance.

For information, you are invited to consult the arbitration rules of the Association of Arbitrator Notaries of Quebec. Members of the Association are subject to ethical rules.

It is not possible to provide an exhaustive list of the different situations where an arbitrator can intervene, but here are some examples:

  • A dispute between a seller and a buyer resulting from the interpretation of a purchase agreement or a sales agreement;
  • A dispute arising from hidden defects or charges affecting the sold property;
  • A dispute arising from the distribution of costs related to the sold property between the seller and the buyer;
  • A dispute between two neighbors due to an easement or encroachment.

Why let a dispute escalate and become burdensome through judicial proceedings? Arbitration, more than just a means, is a more civilized solution to a dispute. Arbitration is therefore a dynamic solution that meets the economic requirements of the contemporary world, where disputes must be resolved quickly while minimizing costs.

The main advantages of arbitration are confidentiality, speed of resolution, and cost limitation:

  • Confidentiality: It is a mode of private justice as opposed to the courts of common law, which are open to the public.
  • Speed of resolution: The arbitrator in charge of a dispute must be requested by the parties to render his decision within a short period of time. This decision is enforceable and without appeal. In practical terms, it can be within six (6) months.
  • Cost limitation: Since the decision is final and without appeal, costs are reduced.

Parties who wish to use an even more flexible form of conflict resolution may be better advised to resort to mediation.

Due to their training and experience, notaries are specially called upon to be impartial between the parties to a contract. They are required to provide advice to ensure that the decision and consent of the parties are properly informed. The notary is the most appropriate professional to act as an arbitrator in a dispute.

We invite you to send your arbitration request to Notaire-Direct® who will meet your needs.

If you need more information on this service, please contact us
514 374-4303
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