Do You have to Close on a Hoarder’s House?

Well, if they have moved everything out, then you do; but what are your rights if they still have piles of junk left behind?

To some extent, the answer depends upon the application of the legal concept of “vacant possession” to the circumstances.

You know the situation. The hoarder has accumulated possessions for decades and never thrown anything out. There are piles of old magazines and newspapers all over the place. You will often find that a hoarder suffers from some kind of mental disability or depression which complicates the matter.

However, no matter the cause, the place is still piled high in junk. Oftentimes, estimates to remove the debris can run as high as $10,000. So, it’s a serious problem.

The seller is under a legal obligation to provide:

1)     legal possession of the property (that means title etc.), and

2)     actual possession of the property.

There are two fundamental issues that can arise with actual possession, someone may be still there or physical objects may prevent the buyer from occupation.

Courts are concerned about actual possession. If there is an impediment that would prevent occupation by a buyer then, they will conclude that vacant possession could not be provided.

If it is serious enough, then the buyer can refuse to close. If it is not that serious, the buyer must still close and seek a remedy by way of damages afterwards.

So, what do we mean by “serious”?

Courts have interpreted this to mean an impediment caused by the presence of physical objects that:

1)     substantially interfere with the buyer’s right of possession,

2)     in respect to a substantial part of the premises.

In every case, the facts will have a significant bearing on the decision. If a small portion of the property is still filled with junk, for example the garage and a shed, but the buyer can still move into the main house, then the buyer’s remedy may just be to sue for damages.

In other situations, you can well imagine that there is so much junk and debris that it would in fact prevent the buyer from moving in. Should that threshold be met, then the buyer can refuse to close.

Thus, the interference needs to be substantial, not just a minor inconvenience and it must involve a substantial part of the premises. That does not mean “more than half”. It could simply be the principal areas that must properly be accessed in order to permit occupation.

These are always interesting situations.

The law on this issue is well summarized in Ramatol v. Chairtex (2002) in the Superior Court of Justice in Ontario.

Brian Madigan LL.B., Broker

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