As of 03th of January 2023, there is new legislation in the Province of British Columbia, that provides buyer(s) an opportunity to rescind a contract to purchase residential real property up to three business days after an offer is accepted. If a buyer chooses to rescind the contract in the time period provided, they must pay the seller 0.25% of the purchase price. This rescission period applies to transactions of residential real property regardless of whether a real estate licensee is involved in the transaction and cannot be waived by the buyer(s) or seller(s).

The types of residential real property that are subject to the rescission period are as follows:

• A detached house;
• A semi-detached house;
• A townhouse;
• An apartment in a duplex or other multi-unit dwelling;
• A residential strata lot, as defined in Section 1 (1) of the Strata Property Act;
• A manufactured home that is affixed to land; and
• A cooperative interest, as defined in Section 1 of the Real Estate Development Marketing Act, that includes the right of use or occupation of a dwelling.

There are some exemptions, and they are listed below:

• Residential real property that is located on leased land;
• A leasehold interest in residential real property;
• Residential real property that is sold at auction; and
• Residential real property that is sold under a court order or the supervision of a court.

The rescission right also does not apply to any purchase and sale of property under the Real Estate Development and Marketing Act where Section 21 of that Act applies -- which is mostly the presales.

Rescinding a Contract of Purchase and Sale

If a buyer chooses to rescind the contract, they must serve written notice to ALL the sellers within the rescission period who's names were in the CPS. A notice of rescission is deemed to be served on a seller if the notice is sent:

• By registered mail to the seller’s address that is set out in the contract of purchase and sale;
• By fax to the seller’s fax number that is set out in the contract; or
• By email, with a requested read receipt, to the seller’s email address that is set out in the contract.

The rescission notice must include the following:

• The address, the parcel identifier (PID) or a description of the property;
• The name, and the signature, or electronic signature, of the purchaser (or buyer) who is exercising the right of rescission;
• The name of each seller who is a party to the contract; and
• The date that the right of rescission is being exercised.

Q: Do subject removal periods run concurrently with the three-business day rescission period?

A: Yes –E.g. If you have a subject to finance in the offer with seven days to remove it, the three-day rescission period runs at the same time as the first three days of the financing subject removal period.

Q: Does the buyer have an automatic right to access the property during the rescission period?

A: It depends. In a subject free offer the buyer would not have an automatic right to access the property. If the offer is conditional on the buyer having access (i.e. such as for a home inspection), the seller would need to comply with the terms of the accepted offer. Licensees must ensure when drafting offers that the terms and conditions reflect the needs and wishes of their client(s).

Q: How are three business days calculated?

A: The three business days (Monday to Fridays excluding Saturdays and holidays) must be three full days so that if an offer is accepted on Monday, the buyer would have until 11:59pm on Thursday to exercise their rescission rights. Holidays are defined by the Interpretation Act:
• Sunday
• Christmas Day
• Good Friday and Easter Monday
• Canada Day
• Victoria Day
• British Columbia Day
• Labour Day
• Remembrance Day
• Family Day
• New Year's Day
• December 26, and a day set by the Parliament of Canada or by the Legislature or appointed by proclamation of the Governor General or the Lieutenant Governor, to be observed as a day of general prayer or mourning, a day of public rejoicing or thanksgiving, a day for celebrating the birthday of the reigning Sovereign, or as a public holiday.

Q: What happens if the brokerage is not holding a deposit?

A: The brokerage will have no obligation as it relates to paying the rescission fee to the seller.The buyer will legally be obligated to pay the rescission fee to the seller and if they do not the seller can seek legal advice on how to recover those funds.

Q: Can a buyer choose to waive their rescission rights?

A: No, a buyer cannot choose to waive their rescission rights.

Q: If a buyer notifies a seller that they are unable to remove subject conditions during the rescission period, do they owe the seller a rescission fee?

A: No, the buyer would only owe a rescission fee if they invoked their rescission right and provided the required notice to the seller.If the buyer is unable to remove subjects, they would follow the same process they always have, even if it is during the rescission period.

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Mir Khan
Certified International Property Specialist, International Realtor Member, Full-time Professional Realtor
Mir Khan Personal Real Estate Corporation
Century 21 AAA Realty Inc.
(778) 558-4427
Mir@MirKhan.ca
www.MirKhan.ca