Pubdate: Sat, 24 Nov 2007 Source: Toronto Star (CN ON) Column: Title Page Copyright: 2007 The Toronto Star Contact: http://www.thestar.com/ Details: http://www.mapinc.org/media/456 Author: Bob Aaron Bookmark: http://www.mapinc.org/mjcn.htm (Cannabis - Canada) WE NEED AN OPEN, COMPREHENSIVE GROW-OP LIST Two weeks ago in this column, I asked whether listing agents should be required to disclose that a home was, or might have been, a marijuana grow operation, or whether they should disclose only if the seller tells them it was a grow-op? Would the public interest be better served, if the Real Estate Council of Ontario (RECO) amended its rules to require disclosure of all material facts about a property that the agent is or should be aware of that could affect a buyer's decision? I raised the questions after I was asked by two clients whether the house they considered buying had been a grow-op. The listing agent was silent on the issue and declined to answer questions on the subject. I was swamped with emails from agents, homeowners and fellow lawyers. Nearly all came down strongly on the side of mandatory disclosure by vendor and agent. One response was from Sandra Gibney, communications manager of RECO - the governing body of Ontario's real estate agents and brokers. She noted that agents not only have an obligation to disclose, but must "take reasonable steps to determine the material facts" relating to the transaction. The regulations also state that the registrant must disclose to the customer all material facts "that are known by, or ought to be known by, the broker or salesperson." Gibney referred to two RECO discipline cases involving the failure to disclose the existence of a grow-op. One involved Mississauga agent Donna Burgess. According to the decision of a RECO panel in June, Burgess was representing both the buyer and seller in a 2005 transaction, but failed to disclose to the buyers that the home they were planning to purchase had been a grow house. This was a material fact, and she was aware of it because in 2003, she had helped the sellers buy the same property. At that time the agreement of purchase and sale contained a disclosure that the use of the property "may have been for the growth or manufacture of illegal substances." Burgess failed to inform the buyers about the disclosure, claiming she had forgotten about it. The buyers and sellers signed a mutual release and the deposit was refunded. A complaint was filed with RECO and a discipline panel ruled that Burgess had failed to comply with the Code of Ethics. It ordered her to pay a penalty of $15,000. Given that there are thousands of current and past grow-ops in Ontario, and the listings of few, if any of them, disclose the history of the property, I would have expected to see more discipline cases like the Burgess decision. Len Chapman, a Royal LePage sales rep in Richmond Hill, emailed to say RECO's rules already require disclosure of facts that an agent ought to know. True enough, but it seems they are being widely ignored when it comes to grow-ops. The vast majority of agents and brokers I've dealt with over the years are competent, honest and ethical. I wrote about the issue to alert readers to the signs of grow-ops, since the history of a property - despite RECO rules to the contrary - is not always disclosed as it should be. The courts have ruled that police must disclose the existence of grow-ops, but it clearly isn't happening in an open and effective way. It's time this province had a comprehensive and fully accessible database to eliminate the excuses. - --- Bob Aaron is a Toronto real estate lawyer whose Title Page column appears Saturdays. - --- MAP posted-by: Jay Bergstrom