Deal fell apart because of UFFI, can we sue?

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In my last 16 years of real estate practice, I’ve never had a house with UFFI whose test readings weren’t close to nil. Despite a lack of evidence to support the notion that UFFI is problematic, there remains a pre-printed section of the Agreement of Purchase and Sale that speaks specifically to whether or not a house has UFFI.

Dear David,

Our house has UFFI, which we disclosed in the MLS listing when we put it up for sale. When we sold the house the first time, UFFI wasn’t crossed out of the Agreement of Purchase and Sale. A week before closing, the buyer used this as their reason for walking away from the deal. We re-listed and sold the house again, for the same price, but feel like the process was much more stressful than it needed to be. Can we sue our agent? – MOVING ON

DEAR MOVING: Many houses have UFFI (Urea Formaldehyde Foam Insulation). In the 1970’s especially, UFFI was commonly used as “retrofit” insulation; it was injected behind walls or into areas where the installation of standard insulation may have been impractical.

UFFI fell out of favour in the 1980’s due to the perceived health problems associated with it. It was eventually banned in Canada (though it still remains popular in Europe). The UFFI warranty in a standard Ontario Agreement of Purchase and Sale was meant to address the concerns of that era and was implemented into the agreement with the intention of offering a level of comfort to buyers.

These days, UFFI has proven to be pretty much inert. In my last 16 years of real estate practice, I’ve never had a house with UFFI whose test readings weren’t close to nil. Despite a lack of evidence to support the notion that UFFI is problematic, there remains a pre-printed section of the Agreement of Purchase and Sale that speaks specifically to whether or not a house has UFFI.

In your case, the buyers would have known your house had UFFI, since it was disclosed in the MLS listing and should have been discussed with their agent.  They bailed very late in the process, which leads me to suspect they got cold feet and used the fact that the UFFI warranty wasn’t crossed out of the agreement as an excuse to walk away from the deal.

There’s no doubt that having to sell your home twice was inconvenient for you. Luckily, it appears that the monetary effect was minor since you were able to sell it again for the same price. Before you decide to sue your agent, ask your lawyer for some professional advice and speak to the real estate brokerages involved. It sounds like your damages may be limited to the cost of carrying your home for the time between when the first sale would have closed and when the second one actually did — along with some aggravation. At the end of the day, it probably adds up to a few thousand dollars and a few weeks of delay. Amass your damages, then take a step back and reassess whether a lawsuit is worth it. Going to court is never easy, and in the end, no one really wins.

PRO TIP: It sounds like your agent was able to get your property back on the market quickly and sell it for the same money as you had originally, complete with UFFI acknowledgement and without remediation expenses. In the end, you may have come out ahead. #AskDavid #Advice

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