assignment of contract bc

Assignment of contract

How it relates to the law in british columbia canada.

In British Columbia, an assignment of contract is a legal document that allows one party to transfer their rights and obligations under a contract to another party. This can be useful in situations where the original party is unable or unwilling to fulfill their obligations under the contract, or where they wish to transfer the benefits of the contract to another party. Under British Columbia law, an assignment of contract is generally valid and enforceable, provided that certain conditions are met. These conditions may include obtaining the consent of the other party to the contract, ensuring that the assignment does not violate any laws or regulations, and ensuring that the assignee is capable of fulfilling the obligations under the contract. In some cases, an assignment of contract may also be subject to specific legal requirements or restrictions, depending on the nature of the contract and the parties involved. For example, certain types of contracts may be subject to specific statutory requirements, such as the requirement for written consent or notice of assignment. Overall, an assignment of contract can be a useful tool for parties in British Columbia to transfer their rights and obligations under a contract, but it is important to ensure that all legal requirements are met in order to avoid any potential legal issues or disputes.

Impact on Business Owners in British Columbia

The impact of the assignment of contract on small businesses in British Columbia, Canada, is that it provides them with the ability to transfer their contractual rights and obligations to a third party. This can be useful for small businesses that are unable or unwilling to fulfill their obligations under a contract, or for those who wish to transfer the benefits of the contract to another party. However, small businesses must ensure that all legal requirements are met, such as obtaining the consent of the other party to the contract and ensuring that the assignee is capable of fulfilling the obligations under the contract, in order to avoid any potential legal issues or disputes.

Potential Legal Risks, Legal Challenges, or Legal Pitfalls for Businesses in British Columbia

As a small business owner in British Columbia, it is important to be aware of the potential legal risks and challenges associated with the assignment of contract. This refers to the transfer of rights and obligations under a contract from one party to another. One potential legal risk is that the assignment may be prohibited by the terms of the contract itself. It is important to carefully review the contract to ensure that there are no restrictions on assignment, or to obtain the consent of the other party to the assignment. Another potential legal challenge is that the assignment may not be valid if it is not properly executed. This could result in a breach of contract and potential legal action against the business. To avoid these issues, it is important to seek legal advice before entering into any contract that may be subject to assignment. This can help ensure that the contract is properly drafted and that any potential restrictions on assignment are identified and addressed. In addition, it is important to ensure that any assignment is properly executed and that all necessary steps are taken to transfer the rights and obligations under the contract to the new party. By being aware of these potential legal risks and challenges, small businesses in British Columbia can take steps to avoid or mitigate them and ensure that their contracts are properly assigned.

BC Business Practices and Consumer Protection Act (BPCPA)

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Assignment of Contract and Purchase and Sale BC

What you need to know about assigning properties.

Written By: Mariko Baerg, REALTOR of Bridgewell Real Estate Group If you’re looking for a realtor to help you assign a property, call me today !

There have been a number of pre-sale condos popping up in the Lower Mainland, and rezoning is happening in a number of places to allow for new residential buildings.

This blog will teach you what an assignment of contract of purchase and sale is and how it works.

With so many presale developments popping up, it’s important that you know your options with your presale and how to handle them safely.

To make this as easy as possible, we’ve written this blog in a question answer format for understanding an assignment of contract in real estate.

Assignment of Contract and Purchase of Sale BC: What is an assignment?

An assignment of contract in real estate is a transaction of a home in which the buyer of the property “assigns” or transfers their rights and obligations of the Agreement of Purchase and Sale previously agreed to another buyer before the original buyer closes on the property. In this case, because completion has not occurred, they are not the legal owner for the property yet, thus they require consent from either the seller or the developer(often times the developer).

This can occur in both resale and presale homes; however, assignments are most commonly found in presales where there is a longer closing, often 5 years away.

When can I assign a home? Are there any restrictions?

You will have to refer back to the original contract of purchase and sale to determine whether or not you are able to assign the home. Some terms you may encounter, specifically for presales, are:

The developer or seller’s approval
Resale profits must be split with the seller unless otherwise agreed to in the contract
Marketing can be very tricky. MLS (multiple listing service) restrictions for online marketing may be prohibited, many developers do not allow the advertising and sale of assignments until the building is sold out.
A time frame when you cannot assign the contract
An assignment fee to be paid to the developer in the presale scenario, usually 2-5% of the sale price.

Why do assignments occur?

Assignments often occur when a presale has appreciated significantly in value prior to completion. The current buyer would like to take the appreciation (often called a “lift”) while it’s up, and assign it to another buyer.

Are assignments legal?

Yes. Real estate contracts are assignable under the law unless the contract expressly forbids it.

In the past – “Shadow Flipping”:

It used to be the case where buyers could “shadow flip” in residential sales, and did not require the sellers approval in order to assign the property prior to completion. This was a huge issue in residential real estate sales in 2015 particularly, and was subject to scrutiny by the public and news broadcasters.

The Real Estate Council of BC has since required that an assignment needs to be approved by the seller and profit be split equally between the current buyer and the seller once assigned. The contract of purchase and sale for resale residential properties has also been updated to avoid “shadow flipping” and assignments without the sellers knowledge. The restriction of assigning properties for profit only applies to resale, and presale can still be assigned at the discretion of the developer.

Assignments now occur in residential resale real estate more-so in some kind of emergency from the buyer, where they are unable to complete for whatever reason like a loss of employment, death, or critical illness. In resale, assignment of contract for profit is less common now than it used to be.

What are the advantages of an assignment for the current buyer assigning the contract?

The assignor (current buyer) can most likely avoid the builder’s closing costs and property transfer tax associated with the subject property;
The assignor may not have to pay the additional taxes (i.e GST) rebate back to the Builder if they intended to occupy the property.
The seller/assignor avoids the carrying costs (mortgage, maintenance fees, taxes, etc.) for the time between listing the property and selling a property that is already completed.

What are the advantages of an assignment for the new buyer?

The assignee (new buyer) may receive a better price than other current properties on the market. This will also depend on the current buyer’s motivation to sell;
The assignee will receive a brand-new home and may also have the opportunity to make finishing selections, such as the kitchen or bathroom colour scheme, depending on when the assignment takes place;
The assignee may be able to avoid Property Transfer Tax if the original Agreement of Purchase and Sale is under $750,000;
The assignee may be able to take advantage of the deposits of the original buyer and be able to put less of a down payment on a property than he would otherwise have been able to.

Are there any restrictions involved with assignments when selling?

Yes, there are a number of restrictions that the developer can put in to the contract that make assigning a home more difficult. The most common restrictions are:

Marketing/MLS restrictions – Your realtor may not be able to advertise on the MLS, so it’s important that you hire someone with a history in presales and a great network
Sales restrictions – The developer will often put restrictions on the number of units that can be assigned at a time, as well as restrictions such as not being able to assign until the building is 100% sold. Refer to the contract for details on restrictions.

Fees associated with an assignment?

If this is a resale home that you are assigning, you will most likely have to split the profits of the assignment with the seller unless otherwise agreed to. Typically there are extra legal fees and there is an assignment fee to the builder if it is a presale assignment.

As previously mentioned, most assignments have the new buyer taking full responsibility for the contract; however, it may be the case where the new buyer and the original buyer have agreed to split some adjustment costs.

You’ll be listing the property, so you will also have to take in to account realtor commissions when assessing your net profits on an assignment.

Are there tax implications on assignments?

If you are unsure about the tax implications, it is always best to speak to an accountant to determine an estimate on what you may incur.

In general though, any profit from the assignment of a property that goes to the current buyer, after having been split out to the seller if previously agreed upon, is subject to tax as part of your income. With regards to property transfer tax, and any goods and services tax on the property, this is typically paid by the new buyer as they are responsible for taking over the contract of purchase and sale in its entirety, unless otherwise agreed upon.

Are there risks involved?

It is very important to make sure that the new buyer is willing and able to take on the assignment as well as all terms and conditions of the contract of purchase and sale. If the assignee, the new buyer, does not follow through with the completion on the sale, the responsibility to close usually defaults back to the original buyer, the assignor.

——

If you are thinking about assigning a property, make sure to talk to a realtor first to determine whether or not you will make a profit. They’ll need to take a look at your original contract, and also assess the current market to determine an estimate of the market value of the subject property.

There is no guarantee that there will be profit associated, in fact there may be a loss in a declining market. Your realtor will have to factor in all costs associated, such as fees and commissions, in order for you to make the best decision.

If you’re thinking about assigning your contract, give us a call today to see what’s right for you: 604-765-0376 . Prefer text? 604-319-0200 or email [email protected] to start a conversation.

Make the home buying process straight-forward from the start. Talk to one of our realtors today.

Get in touch with a realtor.

Want to talk right now? Give us a call 604-765-0376 or text 604-319-0200 .

Do you want to assign a home ?

With Bridgewell’s buyer systems and plans we’re determined to find the right home for you efficiently & effectively all while providing you the guidance and education that you need. Whether it’s presale or resale, investment or to live in, we’ve got you covered.

8 Reasons to Hire a Realtor When Purchasing a Presale
Pre Construction Condo Payment Schedule
GST on New Homes in BC

Assignments of Contract

What is an assignment of contract.

Simple Short Answer: A contract assignment occurs when a buyer transfers the contract to buy property to someone else before the completion date. The buyer can transfer the contract for any price, even for a higher price than they paid for the property. The buyer does not have to pay the seller any additional money if they make money from selling the contract.

Why would you assign your property?

How do I sell an assignment of contract?

The complex has to be sold out before developer will allow assignments
The Timeline when you can sell it. Some developers will only allow a certain window, after a certain date to a certain date. Usually this window starts after the building permit is issued, and expires 3 months before expected completion.
Who you can assign it too. Recently some developers will not allow Foreign buyers to assign local buyers (tax evasion etc)
Fees: Developers can charge assignment fees anywhere from 1%-5% of the purchase price, what purchase price do you ask? thats a very good question. In most cases the developers fee will be based on the Original Purchase price, but in some cases the fee is paid on what you sell it for. and no, you can't sell it for a $1, developer a) will see right through it and b) will not allow the assignment. Some developer assignment fees can also be 25% to 50% of the Lift (profit). (there are other cost to be considered, this is purely developer assignment fees)
Restrict public advertising: Some developers will not allow assignments on MLS, or even use the building name or marketing material. This is where its important to use an experienced agent that has a good network.

So why buy an assignment?

You want new, but don't want to wait 3-4 Years till completion? Assignments are typically sold a bit closer to completion, so you get the benefits of new, but don't have to wait that long.
Pricing: Once a developers gets past the point of their sales goals, pricing and incentives disappear and pricing actually goes up. As since they got their bank financing, there is ZERO motivation on their part to sell the homes at a discount and can wait till completion to sell the home for market value then. A wannabe assignor may not have that luxury, so you can get an assignment of contract purchase on a similar project in the area for slightly below what a competing development is selling for.
PTT- For purchase under $750,000, a purchase by an end users can avoid paying the PTT, and as of right now, that is based on the contract price, not the prices you pay for the assignment. For example you purchase an assignment for $850,000, the value of the contract is actually is $725,000 you will be able to avoid that PTT cost. (rules may change)
GST - Much like PTT, GST will be based on the original purchase price, not the final assignment price. (rules may change)
Deposit - Since the assignor likely paid a lesser price then what they are assigning it for, the total deposit paid on assignment price could overall be less. for example assignor pays $500,000 for a condo, they would have paid 20% down ($100,000) when they assign it to the assignee for $650,000, the assignee would need to match the original deposit of $100,000, not 20% on $650,000 which would be 15%.

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400-1286 Homer St Vancouver, BC V7M 2E6

Phone: 604-813-4686

[email protected]

Real Estate Assignment of Contract in British Columbia

In the realm of real estate transactions, various methods exist for buyers and sellers to navigate property deals. One such method that has gained traction, especially in British Columbia, is the Assignment of Contract. This innovative approach has its own intricacies and benefits, making it important for both parties involved in the process to understand its mechanics. In this blog, we’ll delve into what a real estate assignment of contract is, its implications, and key considerations in the context of British Columbia.

Understanding the Assignment of Contract

A real estate assignment of contract involves the transfer of rights and obligations of a purchase agreement from the original buyer (assignor) to a new buyer (assignee), before the original contract’s completion. Essentially, the original buyer assigns their position in the contract to another party, who then takes over the responsibilities of purchasing the property. This type of transaction can occur in various real estate sectors, such as residential, commercial, and even pre-construction projects.

Key Benefits of Assignment

Profit Potential : One of the primary motivations for engaging in real estate assignments is the potential for profit. The assignor can often sell the property for a higher price than their original contract, thereby capitalizing on the property’s appreciated value or market demand.
Flexible Exit Strategy : Real estate assignments offer flexibility to buyers who might have encountered unforeseen circumstances and are unable to proceed with the initial purchase. Instead of forfeiting the deposit or facing contract cancellation penalties, the assignor can transfer the contract to a willing buyer.
Access to Desirable Properties : Assignees can gain access to properties that might otherwise be challenging to acquire due to limited availability or high demand. This is particularly common in markets where properties are quickly snapped up.
Reduced Hassle : For assignors, selling an assignment can be less complicated than selling the property outright, as they avoid the process of listing, marketing, and showings.

Assignment Process in British Columbia

In British Columbia, the assignment process involves several key steps:

Disclosure : Assignors must inform the original seller of their intent to assign the contract. While it’s not mandatory to obtain the seller’s consent, some contracts might include specific clauses regarding assignment.
Negotiation : Assignors negotiate terms with potential assignees, including the assignment fee, which is often the profit the assignor intends to make from the transaction.
Documentation : Assignors and assignees create an Assignment Agreement detailing the terms of the assignment, the assignment fee, and any other relevant conditions.
Consent : In British Columbia, many contracts require the seller’s consent to the assignment. However, the seller cannot unreasonably withhold consent.
Closing : On the closing date, the assignee fulfills the obligations outlined in the original contract and pays the agreed-upon assignment fee to the assignor.

Considerations and Challenges

Legal Advice : It’s advisable for all parties involved to seek legal advice before entering into an assignment agreement. This helps ensure that the agreement is legally sound and all obligations are understood.
Market Conditions : The potential profit from an assignment heavily relies on market conditions. A sudden shift in the market can impact the viability of an assignment.
Consent and Clauses : Sellers have a say in whether they allow an assignment, and some contracts might include clauses that restrict or regulate the assignment process.
Tax Implications : Both assignors and assignees should be aware of potential tax implications, including capital gains tax and property transfer tax.

The real estate assignment of contract offers an alternative approach to property transactions, allowing flexibility and profit potential for both assignors and assignees. In British Columbia, understanding the legal requirements, negotiation dynamics, and potential challenges associated with this process is crucial. Whether you’re considering becoming an assignor or assignee, seeking professional legal guidance and market insights can help you navigate this intricate facet of the real estate world effectively.

It is so important to us that you feel empowered and educated throughout the buying and selling process – if you want to achieve your real estate goals or are thinking about listing your home soon, give us a call , text , or email with any questions you have! We can answer all of your questions, and give you specific tips related to the investing, stratas, and more. We’re here to help.

Tags: Assignment of Contract , Assignment of contract meaning , BC assignments , Buyers Guide , Condo , Condo presale , First time home buyer , First time home buyer explained , Maple Ridge presale , New build , New buildings , New Construction , Townhouse , What does an assignment of contract mean

Kara Nickle

posted on 15 August 2023

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The Assignment of Commercial Contracts in Legal Practice

Contracts are a prime example of intangible property. Parties to commercial contracts, like other property owners, frequently want to transfer their property to a third party. The transfer of a contract refers to the assignment of some or all of a party’s rights or the delegation of some or all of a party’s performance, or both, to a non-party to the agreement.

Some common instances in which a contracting party in a commercial context may desire to assign contractual rights, performance responsibilities, or both are as follows:

In an asset sale, a corporation sells parts or all of its company.
A contractor who subcontracts its work under certain projects.
A business conglomerate that is going through an internal corporate reorganization.
The borrower who offers its lender a security interest in its assets.
A manufacturer who sells its receivables to a third party.

In any of these cases, the non-transferring party may object to assignment or delegation for a variety of grounds, including:

The desire to choose the party with whom it does business.
Concern that a different obligor or obligee may jeopardize the non-transferring party’s capacity to benefit from the contractual deal

To decide whether the transferring party (also known as the transferor) can execute the proposed transfer without gaining the non-transferring party’s approval, the transferring party must turn to relevant legislation and the plain text of the contract. If consent is necessary and not obtained, the transferring party faces the following risks:

Violation of the contract.
Making an ineffective and invalid transfer.

The Definitions of Assignment and Delegation

Each party to a contract is an:

Obligee in terms of its contractual rights; and
Obligor in terms of its contractual performance responsibilities.

Contract “assignability” is a term frequently used by contracting parties and practitioners. While they may expressly address the assignment of a party’s rights under the contract in some contexts, they frequently use the term “assignment” to refer to both:

The delegation of duty to perform.
The assignment of rights to obtain performance.

However, assignment and delegation are two distinct legal concepts that must be treated individually due to the fact that they might have different outcomes.

What is an Assignment?

Assignment is the transfer of some or all of an obligee’s (assignor’s) rights to receive performance under a contract, generally but not always to a non-party (assignee). A contract benefit is a right (a chose in action) that, in theory, may be delegated by the benefiting party to a non-party. For clarity purposes, this informative piece will assume that the assignee is a non-party, although the rights and responsibilities of the parties addressed apply equally to an assignee who is also a party to the agreement. When these rights are assigned, the assignor no longer has any claim to the advantages of the given rights, which are completely passed to the assignee.

Technically, a contract’s burden cannot be assigned under the law (see National Trust Co. v. Mead [i] and Irving Oil Ltd. v. Canada [ii] ). Transferring performance responsibilities under a contract requires the approval of all parties, making such a transfer a novation.

In practice, parties frequently refer to “assigning a contract” or “allowing the assignment of a contract,” which is actually an inaccurate representation of their intentions. For example, the parties may plan for some or all of the following:

The contract’s rights or benefits may be assigned.
The contract’s burdens or performance duties may be transferred.
Rights and burdens may be transferred.

The Effects of Assignment

The assignor is no longer entitled to any benefits from the assigned rights, which have all been passed to the assignee; nonetheless, even if the assignor is stripped of its contractual rights, assignment does not decrease or remove the assignor’s duties to the non-assigning party. As previously stated, a contract’s burden may only be assigned to a third party with the approval of all parties. As a result, the assignor is still obligated to fulfill its contractual commitments. The non-assigning party retains the following:

Its entitlement to get performance from the assignor; and
Its remedies against the assignor in the event of non-performance.

The ordinary rule is that a party can only assign its benefits without the consent of the other party to the contract and will remain liable to the other party for its performance obligations (see National Trust Co. v. Mead [iii] and Rodaro v. Royal Bank [iv] ). If the assignor intends to transfer its obligations and both the non-transferring party and the potential assignee agree, the parties should enter into a novation agreement, which results in a new contract between the assignee and the old contract’s remaining (non-transferring) party. In practice, the assignee often undertakes the contract’s performance responsibilities as of the date of assignment, and the assignor gets an indemnity from the assignee in the event of a breach or failure to perform.

A clear, present, purpose to transfer the assigned rights without needing any additional action by the assignee is required for an assignment to be effective, which means that a promise to assign in the future is ineffective as an actual transfer. Otherwise, no special terminology is necessary to draft an effective assignment.

What is Delegation?

Delegation is the transfer of some or all of an obligor’s (delegating party’s) performance responsibilities (or conditions demanding performance) under a contract to a non-party (delegatee). To be effective, a delegation requires the delegatee to agree to take on the delegated performance; however, unless the non-delegating party has consented to a novation, the delegating party remains accountable for the delegated performance, whether or not it has also transferred its contractual rights.

This is distinct from an assignment of rights, in which the assignor relinquishes its contractual claims upon assignment. As a result, even if the delegating party can effectively delegate its actual performance to the delegatee (such that the delegatee’s actual performance discharges the delegating party’s duty), the delegating party cannot be relieved of its obligation to perform and liability for non-performance unless the non-delegating party agrees to a novation.

There is no precise wording necessary to create an effective delegation, just as there is not for the assignment of rights. When performance is effectively delegated, the delegatee assumes liability for the delegating party’s performance obligations (under an assumption agreement), even if the delegating party retains liability to the non-delegating party for the delegatee’s failure to adequately perform the delegated obligations in the absence of a novation. Under an assumed agreement, the delegating party may have recourse against the delegatee, which is frequently addressed through a contractual indemnity right.

If the delegating party wishes to entirely exclude itself from liability for non-performance, it must get the non-delegating party’s approval to the contract (novation). In the majority of novations, the delegating party, the delegatee, and the non-delegating party all agree on the following:

The delegatee replaces the delegating party as a party to the contract.
The delegating party is no longer liable for contract performance.
The delegatee is directly and solely liable for the delegating party’s contract fulfillment.

Types of Assignment – Legal (Statutory) Assignment vs. Equitable Assignment

Legal (Statutory) Assignment: An assignment that satisfies the provisions of the appropriate province or territory laws (for example, the Conveyancing and Law of Property Act [v] )
Equitable Assignment: An equitable assignment may be enforced even if it does not fulfill the statutory requirements for a legal assignment.

Requirements for a Legal (Statutory) Assignment

All of Canada’s common law provinces have enacted legislation allowing the transfer of contract rights. Notably, the legislation for Ontario is the Conveyancing and Law of Property Act .

These statutory assignments are enforceable if the parties comply with the following procedures:

The assignment is absolute.
The assignment is in writing, signed by the assignor
the non-assigning obligor is given express written notice.

A statutory assignment does not need consideration, and no precise words or form are necessary. They can be made as gifts and be valid.

Requirements for an Equitable Assignment

An assignment may be enforceable as an equitable assignment even if it does not fulfill the formality criteria of a statutory assignment. An equitable assignment does not necessitate the use of any specific terms or form. However, in order to comply with any provincial statutes of frauds regulations, the assignment must be in writing. The phrasing must clearly indicate that the assignee is to benefit from the rights being assigned. In contrast to a statutory assignment, consideration is required until there is a full transfer, such as a gift. It is not necessary to provide the non-assigning obligor with express written notification (except in the case of a transfer of land). However, notification is often given largely to assure that:

The obligor ceases to pay the assignor.
The assignee has priority over subsequent encumbrances.

Contractual Anti-Assignment & Anti-Delegation Clauses

Rather than relying on relatively uncertain legal rules, most commercial contract parties handle transferability issues in the written agreement. As a result, most commercial contracts include a negative covenant that restricts one or both parties’ rights to assign.

These clauses frequently include specific exceptions that allow one or more of the parties to assign and delegate rights and duties, often to designated non-parties such as affiliates and successors-in-interest to the transferring party’s business.

Courts frequently uphold provisions that prevent assignment because they favor the rights of parties to freely contract. However, subject to specific limitations, there is a broad assumption that contractual rights are assignable. As a result, the case law on anti-assignment provisions is a little erratic. Some courts have upheld anti-assignment clauses and declared the agreement unenforceable. Others have argued that an anti-assignment provision cannot preclude assignment.

Overall, contractual anti-assignment and anti-delegation provisions are commonly included in many types of business contracts. If not, transferability is determined by the contract’s subject matter and the nature of the rights and obligations to be transferred. It is important to stay knowledgeable the existence of such contractual terms when dealing with various commercial contracts…such as contracts for the sale of goods, personal service contracts, commercial real estate leases and various other types of contracts.

If you have any questions about your business’s contractual assignment or delegation needs, contact Cactus Law today to speak with a lawyer specializing in commercial law.

Disclaimer:

The information presented above is solely for general educational and informational purposes. It is not intended to be, and should not be taken as, legal advice. The information given above may not be applicable in all cases and may not even reflect the most recent authority after the date of its publication. As a result, please refer to all updated legislation, statutes, and amendments. Nothing in this article should be relied on or acted upon without the benefit of legal advice based on the specific facts and circumstances described, and nothing in this article should be interpreted otherwise.

About the Author:

Kanwar Gujral is entering his third year at Osgoode Hall Law School in Toronto, Ontario. He has a dedicated interest in real estate, business, and corporate law.

[i] National Trust Co. v. Mead , 1990 CarswellSask 165 (S.C.C.).

[ii] Irving Oil Ltd. v. Canada , 1984 CarswellNat 137 (Fed. C.A.).

[iii] Supra note 1.

[iv] Rodaro v. Royal Bank , 2002 CarswellOnt 1047 (Ont. C.A.).

[v] Conveyancing and Law of Property Act , R.S.O. 1990, c. C.34.

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Subletting and assigning tenancies

Natural disasters and tenancy

Tenant rights

A sublet is when a tenant moves out of their rental unit and allows someone else to live there temporarily. An assignment is when a tenant finds someone to take over their tenancy agreement. Tenants need written permission from the landlord to sublet a rental unit or assign a tenancy agreement.

Landlord responsibilities

Landlord rights.

I need help

A sublet is when a tenant temporarily moves out of their rental unit and rents their unit to another tenant (subtenant) until they return. The original tenant must sign a new tenancy agreement (a sublease) with the subtenant.

Landlords and sub-tenants don't have a contractual relationship

When a sublet happens, the original tenant becomes the sub-tenant's landlord. The sub-tenant has the same rights and obligations outlined in the original tenancy agreement.

An assignment is when a tenant permanently moves out and transfers their tenancy agreement to a new tenant. This usually happens when a tenant wants to get out of a fixed-term tenancy early.

The original tenancy agreement still applies

When a tenancy is assigned, the new tenant takes on all the rights and responsibilities of the original tenancy agreement. For example, if the original tenancy agreement had a no pet clause, the new tenant would not be allowed to get any pets.

The new tenant and the landlord can also agree to new terms or sign a new agreement.

Learn more about tenancy agreements

Sublets and assignments are conditional

Tenants can only sublet or assign a tenancy if:

The tenant has the landlord's written agreement

A tenant must have their landlord's written permission before subletting or assigning their tenancy. A landlord can't unreasonably refuse a sublet or assignment if there are six months or more remaining on the tenancy term.

The tenant has an order

Tenants can sublet or assign their tenancy if they have an order from the Residential Tenancy Branch (RTB) allowing them to do so.

The tenancy agreement allows sublets

Tenants can sublet or assign their tenancy unless it is prohibited in the tenancy agreement. Subsidized housing providers often don't allow for subletting or assignment of tenancies.

Tenant responsibilities

Tenant and subtenants must sign a sublease .

The original tenant must sign a sublease agreement with the new tenant during a sublet.

The original tenant becomes the subtenant's landlord

The original tenant becomes the sub-tenant's landlord when a sublease agreement is signed. The sub-tenant has the same rights and obligations as the original tenancy agreement. The sub-lease agreement must align with the original tenancy agreement.

Subletting without written permission can lead to eviction

If a tenant sublets or assigns their tenancy without their landlord's written permission, the landlord may serve notice to end the tenancy . This means the tenancy would also end for the subtenant, unless they negotiate a new tenancy agreement with the landlord.

Tenants can seek dispute resolution to allow sublets or assignment

If a landlord refuses a request to sublet or assign a tenancy, tenants can seek dispute resolution if they believe the landlord is being unreasonable. Dispute resolution is a process to help resolve conflicts between landlords and tenants.

Landlords should agree to sublets or assignments

Landlords can't unreasonably refuse a sublet or assignment of a fixed term tenancy if there are six or more months left in the term.

Refusal can lead to dispute resolution

If a tenant requests a sublet or assignment and a landlord reasonably believes that the person won't be able to follow the terms of the tenancy agreement, the landlord can refuse the request. However, the tenant can then seek dispute resolution if they believe that the landlord have unreasonably refused their request.

Landlords can conduct checks on new tenants

Landlords are entitled to ask for information such as credit or reference checks on a potential new tenant. If it appears the potential tenant will not be able to follow the terms of tenancy agreement, a landlord can refuse the request.

Note: Landlords must not charge a potential tenant for considering, investigating, or consenting to an assignment.

Policy guidelines

19: Assignment and sublet (530KB)

Previous legal decisions

Learn more about past residential tenancy investigation decisions

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Sublet and assignment, previous legal decisions.

A sublet occurs when a tenant temporarily moves out and rents their unit to a subtenant until they return, whereas an assignment occurs when a tenant permanently moves out and transfers their agreement to a new tenant.

To sublet or assign your tenancy agreement, you must have your landlord’s written permission. See TRAC’s template letter, Permission to Assign or Sublet . However, according to section 34(2) of the Residential Tenancy Act (RTA), if your fixed term tenancy agreement has at least six months remaining, your landlord cannot unreasonably deny your request. If your landlord is being unreasonable, you can apply for dispute resolution through the Residential Tenancy Branch to request an order allowing you to sublet or assign your tenancy.

See Residential Tenancy Branch Policy Guideline 19 for more information.

These rules about sublet and assignment apply to most types of rental housing, but there is one exception. A landlord can refuse a tenant the right to sublet or assign their unit if the tenant lives in non-profit housing that falls under section 2 of the Residential Tenancy Regulation , and their rent is also related to their income.

RTB Decision

Landlord not allowed to unreasonably withhold consent
Tenant assigning agreement may retain residual liability
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CBABC and the BC Real Estate Association hold joint copyright over the Standard Form Contracts of Purchase and Sale and related documents. They are available free of charge to CBA members.

By accessing and using these forms, the CBA member acknowledges and agrees that these forms were developed by CBABC and BCREA for the use and reproduction by BC REALTORS® and members in good standing with the CBA, and others authorized in writing by CBABC and/or BCREA. Any other use or reproduction is prohibited. The form is not to be altered when printing or reproducing the standard pre-set portion. BCREA and CBABC bear no liability for your use of these forms.

CBABC’s Residential Conveyancing Working Group contributes to the periodic updates of the Standard Forms. If you have suggestions or wish to contribute, email [email protected] .

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Contract of Purchase and Sale Contract of Purchase and Sale Addendum

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Contract of Purchase and Sale for Commercial Real Estate Contract of Purchase and Sale for Commercial Real Estate Addendum

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Contract of Purchase and Sale of a Manufactured Home on a Rental Pad Contract of Purchase and Sale of a Manufactured Home on a Rental Pad Addendum

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Tenant’s Agency Exclusive Contract Tenant’s Agency Exclusive Contract Schedule “A”

Real Estate Law Blog

The Province of British Columbia is taking steps to ensure that the applicable taxes are paid on assignments of pre-sale condominiums with the introduction of Bill 25 Real Estate Development Marketing Amendment Act , 2018. The goal of the legislation is to collect the applicable tax on such assignments and to generally discourage the assignment of such contracts and reduce what the government perceives to be speculation in the pre-sale condominium market.

The assignment of a pre-sale condominium may, depending on the factual background, be subject to Goods and Services Tax (“GST”). To date there has not been an efficient way for government to learn of any assignment and determine if GST is payable, and then collect the GST payable.

If approved by the legislature, the proposed changes to the Real Estate Development Marketing Act (“REDMA”) on such transactions will require real estate developers to collect and report information on the assignment of pre-sale condominiums. This will allow the federal government to more effectively determine if GST is payable and ensure people are paying the applicable GST when these contracts are assigned.

Once the legislation is adopted, developers will have to include terms in their contracts of purchase and sale that: (a) restrict the assignment of such contracts without the developer’s consent; and (b) inform buyers of the new reporting requirements. When processing the request for consent, the developer will be required to collect specific information about the assignee and the assignor, including names of the assignee and assignor, social insurance numbers, contact details and the amount paid by the assignee to the assignor. The information will be reported by the developer to the Administrator designated under the Property Transfer Tax Act .

Bill 25, like much recent legislation, provides that most of its provisions will be set out in the regulations that are not yet publicly available. Details such as what information is to be collected, how quickly and frequently it is to be passed on the Administrator of PTT Branch, how it applies to existing contracts, and the developer’s liability for incorrect information, have not yet been addressed.

Bill 25 also provides a substantial increase in administrative monetary penalties and fines. This increase applies to all offences under REDMA , not just with respect to the collection of assignment information. The government has decided that it needs the ability to levy higher penalties and fines should the appropriate circumstances arise.

There are no penalties for assignors and assignees who provide false or inaccurate information to developers, which then gets shared with the government. Presumably the government will recognize that developers are not in a position to verify the information that is provided by third parties and should not be held liable when the developer has made a reasonable attempt to collect the information.

Ed practices in the real estate and municipal law fields with a specialty in real estate development.

Ed has assisted clients in such projects as: redevelopment of industrial sites to permit multi-family residential uses; heritage ...

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‘Shadow Flipping’ and New Regulations for the BC Real Estate Industry

In the world of real estate, ‘shadow flipping’ is the practice of a purchaser entering into a contract with a vendor to buy real estate and then selling and assigning that contract to another purchaser for a higher price before the contractual closing date. The profit is kept by the purchaser and shared by the people who arranged the deal; this sometimes includes realtors who may induce the original vendor to sell their property to the purchaser (who may be working with the realtor) for a lower price knowing that the property is worth more and that the purchaser can turn around and sell the property to another purchaser for more than the original vendor received. Although this particular use of assignment is objectionable, assignment is in general a legitimate and legal business practice. A real estate contract is generally assignable by common law unless it is expressly forbidden by the contract. Section 36 of the Law and Equity Act provides that there is no requirement that the vendor consent to the assignment provided that the purchaser gives the vendor written notice of the assignment.

Changes to the Regulation of the Real Estate Industry in BC

Due in part to the problems of ‘shadow flipping’ and concerns over consumer protection and public confidence in the regulation and practices of licensed realtors in BC, the Real Estate Council of BC (RECBC) created the Independent Advisory Group (IAG) to review how the RECBC manages realtor misconduct. On February 9, 2016 the IAG was formed to bring together private and public sector experts to review the conduct requirements established for realtors and examine if those requirements are sufficient and are being effectively administered. A report from the IAG was released on June 28, 2016 which recommends “important changes to the regulatory regime to improve public protection, including greater transparency for consumers, higher penalties, improved reporting of [realtor] misconduct, governance changes, and improved public accessibility to the regulator”. Based on this report, Premier Christy Clark announced on June 29, 2016 that the real estate industry will no longer be allowed to regulate itself. Since 2005 the RECBC has been a self-regulating body mostly controlled by realtors overseeing discipline, licensing, and regulation of the BC real estate industry. When the province’s new changes come into effect, there will be a dedicated Superintendent of Real Estate who will take over these duties.

New Regulations under the Real Estate Services Act

In addition to the changes announced June 2016, Premier Clark also announced earlier on March 18, 2016 that BC would introduce new rules to require real estate vendors to consent to any assignment of real estate contracts and require that any profits from the assignment of real estate contracts go to the vendor. The rules are to prevent the situation described above in which a purchaser buys a property from a vendor and then reassigns the contract at a higher price before the sale closes without the vendor’s knowledge. The new regulations under the Real Estate Services Act came into force May 16, 2016 and state the following in section 8.2(3):

Unless otherwise instructed in writing by the party to whom or on whose behalf the licensee is providing trading services, a licensee must include the following terms in a contract the licensee prepares for consideration by that party before the contract is presented to another party:

(a) this contract must not be assigned without the written consent of the seller;

(b) the seller is entitled to any profit resulting from an assignment of the contract by the buyer or any subsequent assignee.

In response to this legislation, the British Columbia Real Estate Association added the following paragraph to its standard Contract of Purchase and Sale:

20A. RESTRICTION ON ASSIGNMENT OF CONTRACT:

The Buyer and the Seller agree that this Contract: (a) must not be assigned without the written consent of the Seller; and (b) the Seller is entitled to any profit resulting from an assignment of the Contract by the Buyer or any subsequent assignee.

Penalty for Non-compliance

What happens if a realtor does not include the language required by the regulations? Section 35(1)(a) of the Real Estate Services Act states that a “licensee commits professional misconduct if the licensee . . . contravenes this Act, the regulations or the rules” . Section 43(1) says that if a discipline committee determines that a realtor has committed professional misconduct, the discipline committee must do one or more of the following:

(a) reprimand the licensee;

(b) suspend the licensee’s licence for the period of time the committee considers appropriate or until specified conditions are fulfilled;

(d) impose restrictions or conditions on the licensee’s licence or vary any restrictions or conditions applicable to the licence;

(e) require the licensee to cease or to carry out any specified activity related to the licensee’s real estate business;

(f) require the licensee to enrol in and complete a course of studies or training specified in the order;

(g) prohibit the licensee from applying for a licence for a specified period of time or until specified conditions are fulfilled;

(h) require the licensee to pay amounts in accordance with section 44 (1) and (2) [recovery of enforcement expenses] ;

(i) require the licensee to pay a discipline penalty in an amount of

(i) not more than $20 000, in the case of a brokerage or former brokerage, or

(ii) not more than $10 000, in any other case.

Therefore, if a realtor contravenes the regulations and does not include the required terms in the contract, then the realtor could face serious consequences that could hinder or prevent them from working in the real estate industry.

What Effect will the Regulations Have? Are there any Problems?

The main purpose of section 8.2 of the regulations is to protect vendors who are selling real estate from persons using the legitimate practice of assignment to illegitimately deprive those vendors of additional profits that should rightfully be theirs. However, on the face of it, there are a few problems with the regulations.

One problem is that the regulations only apply to a “licensee”, in other words, a realtor. This means that the regulations do not apply to non-licensed agents. Although many people use licensed realtors to sell real estate, if a person uses a non-licensed agent, the regulations will not apply and that person will not benefit from the protection afforded by the regulations.

Another problem with the regulations is that they do not provide sufficient remedies for the vendor if ‘shadow flipping’ occurs. If a realtor does not include the provision required by the regulations and the purchaser profits by assigning the sale to another purchaser (engages in ‘shadow flipping’), then the vendor has no remedy against the original or second purchaser. The vendor can only report the realtor for committing professional misconduct and take legal act against them for negligence for failing to include the provision. It is questionable if either of these avenues would return the lost profits to the vendor.

Whether these flaws will prevent the regulations from having the intended cooling effect on the practice of ‘shadow flipping’ is yet to be seen as the real estate market in BC continues to heat up and record sales are recorded.

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Assignment of a Purchase and Sale Agreement for a New House or Condominium Unit

From: Canada Revenue Agency

Effective May 7, 2022, all assignment sales in respect of newly constructed or substantially renovated residential housing are taxable for GST/HST purposes. This publication will be updated to reflect this legislative change. For more information about the legislative amendment, refer to GST/HST Notice 323, Proposed GST/HST Treatment of Assignment Sales .

GST/HST Info Sheet GI-120 July 2011

This info sheet explains how the GST/HST applies to the assignment of a purchase and sale agreement for the construction and sale of a new house.

The term "new house" used in this info sheet refers to a newly constructed or substantially renovated house or condominium unit. A house that has been substantially renovated is generally given the same treatment under the GST/HST as a newly constructed house. Extensive modifications must be made to a previously occupied house in order to meet the definition of a "substantial renovation" for GST/HST purposes. For a full explanation of the factors to consider in deciding if a substantial renovation has taken place, refer to GST/HST Technical Information Bulletin B-092, Substantial Renovations and the GST/HST New Housing Rebate .

In this publication, a house includes a single unit house, a semi detached house, a duplex, a rowhouse unit and a residential condominium unit (condo unit), but does not include a mobile home or floating home.

Where a person enters into a purchase and sale agreement with a builder for the construction and sale of a new house, the person may be entitled to assign their rights and obligations under the agreement to another person (an assignee). Generally, the result of the assignment is that the purchase and sale agreement is then between the builder and the assignee.

This publication addresses the situation where

a purchaser (referred to as the first purchaser) enters into a purchase and sale agreement with a builder (Builder A) for the construction and sale of a new house, and
the first purchaser subsequently assigns the agreement to an assignee (referred to as the assignee purchaser) before Builder A transfers possession or ownership of the house to the first purchaser and before any individual has occupied the house as a place of residence or lodging.

Generally, upon entering into an agreement for the construction and sale of a new house, the first purchaser is considered to have acquired an interest in the house. For GST/HST purposes, the assignment of the agreement to the assignee purchaser is normally considered to be a sale of the first purchaser's interest in the new house. The sale of an interest in a new house is generally taxable where the person selling the interest is a builder of the house.

For GST/HST purposes, the term "builder" is specifically defined and is not limited to a person who physically constructs a house. There are several instances in which an individual or other person is a builder for GST/HST purposes. For more information on persons who are included in the definition of "builder", refer to GST/HST Memorandum 19.2, Residential Real Property .

This info sheet addresses only whether a person is a builder as described in the following paragraph.

Primary purpose: selling the house or an interest in the house or leasing the house in certain circumstances

A builder includes a person who acquires an interest in a new house before it has been occupied by an individual as a place of residence or lodging for the primary purpose of selling the house or an interest in the house or leasing the house, other than to an individual who is acquiring the house otherwise than in the course of a business or adventure or concern in the nature of trade. When that person is an individual, the individual must acquire the interest in the course of a business or an adventure or concern in the nature of trade in order to be a builder described by this paragraph.

Even if a person is not a builder as described in the preceding paragraph, the person may be a builder based on one of the other definitions of the term as described in GST/HST Memorandum 19.2.

Assignment of a purchase and sale agreement by a person other than an individual

Where a person other than an individual (e.g., a corporation) is a builder as described in the section "Primary purpose: selling the house or an interest in the house or leasing the house in certain circumstances" and the person assigns a purchase and sale agreement for a new house, the person's sale of the interest in the house is subject to the GST/HST whether the sale takes place in the course of a business, an adventure or concern in the nature of trade, or otherwise.

Assignment of a purchase and sale agreement by an individual

If an individual enters into a purchase and sale agreement for one of the primary purposes described in the section "Primary purpose: selling the house or an interest in the house or leasing the house in certain circumstances", the sale of the interest in the house (or the house itself) is normally considered to be made in the course of an adventure or concern in the nature of trade or, depending on all of the surrounding circumstances, in the course of a business. If it is established that an individual is selling an interest in a new house in the course of a business or adventure or concern in the nature of trade, the individual is considered to have entered into the purchase and sale agreement for the primary purpose of selling the house or an interest in the house.

Whether the activity of acquiring an interest in a house, as a result of entering into a purchase and sale agreement, is done in the course of a business or an adventure or concern in the nature of trade is a question of fact. For more information on how to determine whether an activity is done in the course of a business or an adventure or concern in the nature of trade, refer to Appendix C of GST/HST Memorandum 19.5, Land and Associated Real Property .

Factors in determining the primary purpose

All of the relevant factors surrounding entering into a purchase and sale agreement should be considered in determining the primary purpose for a person's acquisition of an interest in a new house.

The following factors may indicate that, for GST/HST purposes, a person entered into a purchase and sale agreement for the primary purpose of selling an interest in the new house or the house itself. The factors are not listed in any particular order and there is no intent to weigh one more heavily than another.

The person offers to sell their interest in the house or takes other actions to attract buyers before, or while, the house is under construction.
The person finances the purchase of the house by a short-term mortgage, or an open mortgage that can be paid off without penalty, rather than by a long-term or closed mortgage.
Financing of the house is beyond the person's means and that person is relying on the increased value and saleability of the house, or an interest in the house, in a rising housing market.
The person is an individual and their stated intention to occupy the house as a place of residence is not supported by the circumstances of the case. For example, an individual has a family of four and enters into a purchase and sale agreement for a one-bedroom condo unit where they are not contemplating any changes in family circumstances.
The person's pattern of activity is such that their occupancy of the house does not have the qualities or characteristics of being permanent. For example, the person purchases more than one house at or around the same time. This factor may be given extra weight where the person has previously entered into a purchase and sale agreement for purposes of selling the house or an interest in the house. There are no outward indicators to support a contrary primary intention (i.e., an intention contrary to an intention of resale). For example, an individual is selling a condo unit, one or more of the above factors are present, there are no physical actions or evidence that the individual's primary intention was to live in the condo unit, use it as a vacation home, or rent it to another individual for use as their place of residence, and no evidence that the sale of the condo unit was triggered by some unforeseen event.

In order for the acquisition of an interest in a new house to be for one of the primary purposes described in the section "Primary purpose: selling the house or an interest in the house or leasing the house in certain circumstances", the intention to sell the house or an interest in it, or to lease the house in the manner described in that section, must have existed at the time of acquiring the interest. Nonetheless, the intention at the time of acquisition may be demonstrated over a period of time.

If an individual acquired an interest in the house for the primary purpose of using it as a place of residence, the person is not considered to be a builder of the type described in this info sheet even if, at a later point in time, the person sells the house or an interest in the house. However, the person may still be a builder if the person meets one of the other definitions of that term as described in GST/HST Memorandum 19.2.

The following examples illustrate when a person may or may not be a builder of a new house.

Sarah, Francine, and Angela are roommates renting a three-bedroom house. They entered into a purchase and sale agreement with a builder in January 2010 for a one-bedroom condo unit in a new condominium complex that was to be built. The purchase price under the agreement was $300,000 and the closing date was July 31, 2013.

In March 2011, the fair market value of the new condo unit had increased by 50%. They entertained several offers for the sale of their interest in the condo unit before assigning it to James. No individual had occupied the condo unit as a place of residence or lodging when they sold their interest in the unit. They split the proceeds, which they each used as a down payment to buy their own homes.

As it would not be practical for the three individuals to live in the condo unit together, they considered several offers for their interest in the unit, and there are no indicators to support a contrary intention, Sarah, Francine and Angela are considered to have acquired their interest in the condo unit for the primary purpose of selling the unit or an interest in it. The sale is considered to be made in the course of a business or adventure or concern in the nature of trade. Accordingly, Sarah, Francine, and Angela are all builders of the condo unit for GST/HST purposes. As they are builders of the unit and the sale of their interest in the unit is not exempt, GST/HST applies to the sale of each of their interests.

Pascal and Chantal own a four-bedroom house where they live with their three children. This is the only home they have ever owned and lived in. They have never purchased any other real property.

In June 2009, they entered into a purchase and sale agreement with a builder for a 1-bedroom condo unit in a new high-rise condominium complex that was to be built. The purchase price under the agreement was $275,000 and the closing date was June 30, 2010. In May 2010, they sold their interest in the new condo unit for $400,000 before it had been occupied by any individual as a place of residence or lodging. They used the sale proceeds to build an addition to their current home.

Although Pascal and Chantal have no history of buying and selling real property, it would not be practical for their family of five to occupy the condo unit as their place of residence. Lacking evidence to support a contrary intention, their primary purpose in acquiring the interest in the condo unit is considered to be for the purpose of selling the condo unit or an interest in it in the course of a business or an adventure or concern in the nature of trade. Accordingly, they are builders of the new condo unit for GST/HST purposes. As the sale of their interest in the unit is not exempt, GST/HST applies to the sale of their interest.

Eric and Gina owned a 3-bedroom house where they lived with their 3 children. They entered into a purchase and sale agreement with a builder in October 2010 to purchase a new 4-bedroom house that was to be built. They intended to use the new house as their primary place of residence as it was located much closer to the children's school and to Eric and Gina's workplaces and had more space. The closing date is July 31, 2011.

Eric and Gina sold their current home in January 2011 and moved into a rented home they planned to live in until their new house was ready. However, in June 2011, Gina's mother became ill and moved in with them as she was no longer able to live on her own.

Eric and Gina decided that the new house would no longer be large enough and that they would now need a house with a granny suite. They sold their interest in the new 4-bedroom house so that they could buy a bigger home that would suit their changed needs.

Eric and Gina's sale of their original home and temporary move to a rented house during the construction of the new home and their choice to purchase a home located closer to school and work support that their intention in acquiring the interest in the new house was to use the house as their primary place of residence. Given this, and the fact that their only reason for selling the interest was due to a change in personal circumstance (i.e., the new house would no longer accommodate their family's needs), they are not considered to have acquired the interest in the house for the primary purpose of selling it. Accordingly, they are not builders of the new house for GST/HST purposes and the sale of their interest in the house is exempt.

Cindy entered into a purchase and sale agreement with a builder in November 2010 for a new house that was to be built. She intended to use the house as her primary place of residence. Her new home would be located within walking distance from her workplace and would be closer to her family than the apartment she is currently renting. The closing date for the purchase is September 30, 2011.

In July 2011, Cindy's employer announced that it was relocating to another city located three hours away. To keep her current job, Cindy had to move to that city. She sold her interest in the house to John.

Since Cindy had intended to use the house as her primary place of residence and her only reason for selling her interest in the house was due to work relocation, she did not acquire the interest in the house for the primary purpose of selling it. Therefore she is not a builder of the house for GST/HST purposes and the sale of her interest in the house is exempt.

Assignment fees

The consideration charged for the sale of an interest in a house generally includes amounts that a person paid to a builder (e.g., a deposit) and that the person wants to recover when assigning their interest in the house. The sale price for the interest may also include a profit, i.e., an amount over and above amounts the person had paid to the builder. If a person's sale of their interest to an assignee purchaser is taxable, the total amount payable for the sale of the interest is subject to GST/HST, including any amount the person paid as a deposit to the builder, whether or not such an amount is separately identified.

A first purchaser enters into a purchase and sale agreement for a new house with a builder (Builder A) and pays a deposit of $10,000 at that time. The first purchaser does not make any further payments to Builder A. The first purchaser subsequently assigns the agreement to an assignee purchaser for $15,000. If the sale of the interest in the house from the first purchaser to the assignee purchaser is subject to GST/HST, tax applies to the full $15,000. This is the case even if the assignment agreement identifies that the $10,000 is a recovery of the deposit that the first purchaser paid to Builder A.

The assignment of a purchase and sale agreement for a new house may be subject to the approval of the builder with whom the first purchaser originally entered into the agreement to construct and sell the new house. The agreement may list conditions related to the first purchaser's right to assign the agreement to an assignee purchaser and, in many cases, the builder charges a fee to the first purchaser for the assignment of the agreement to another person.

The fee charged by the builder in such circumstances is generally subject to the GST/HST.

Eligibility for a GST/HST new housing rebate and provincial new housing rebate (where applicable) where a purchase and sale agreement is assigned

The GST/HST new housing rebate, and where applicable, a provincial new housing rebate, may be available for a new house purchased from a builder and for owner-built new housing. Guide RC4028, GST/HST New Housing Rebate , sets out the eligibility criteria for both types of GST/HST new housing rebates and provincial new housing rebates.

If the first purchaser (the assignor) makes a taxable sale of an interest in a house, i.e., the first purchaser is a builder and assigns the purchase and sale agreement to an assignee purchaser, the first purchaser would not be eligible for either a GST/HST new housing rebate or provincial new housing rebate as they did not acquire the house for use as their primary place of residence. Even if the sale of the interest in the house by the first purchaser is not subject to GST/HST (i.e., in situations where the first purchaser is not a builder of the house), the first purchaser would generally not be eligible for either a GST/HST new housing rebate or a provincial new housing rebate as the conditions for claiming the rebates are not met (e.g., ownership of the house would not transfer to the first purchaser, but to the assignee purchaser).

The assignee purchaser, if an individual, may be eligible for a GST/HST new housing rebate, and where applicable a provincial new housing rebate, where the assignee purchaser receives an assignment of a purchase and sale agreement for a new house. The assignee purchaser would have to meet the eligibility conditions for the rebates as set out in Guide RC4028.

Where a purchase and sale agreement for a new house is assigned, there may be two builders of the house – the original builder (Builder A) and the first purchaser (the assignor). If that is the case, an assignee purchaser would generally have to pay the GST/HST to Builder A for the purchase of the new house and to the first purchaser for the purchase of the interest in the new house.

Claiming a GST/HST new housing rebate when there is more than one builder

In some cases, the builder of a new house pays or credits the amount of the GST/HST new housing rebate, and where applicable, a provincial new housing rebate, to the purchaser of the house. In this case, the builder credits the amount of the new housing rebates to the purchaser by reducing the total amount payable for the purchase of the house by the amount of the expected rebates.

Where this happens, the purchaser and the builder have to sign Form GST190, GST/HST New Housing Rebate Application for Houses Purchased from a Builder , and the builder has to send the form to the Canada Revenue Agency (CRA). As the purchaser receives the amount of the rebate from the builder, the builder may claim the amount as a credit against its net tax when it files its GST/HST return.

Only one new housing rebate application can be made for each new house. Therefore, an assignee purchaser cannot submit a rebate application through a builder (Builder A) for the tax paid to Builder A on the purchase of the house and submit a second rebate application through the first purchaser (the assignor), or directly to the CRA, for the tax paid to the first purchaser on the purchase of the interest in the house.

In such cases, the assignee purchaser may want to file their new housing rebate application directly with the CRA rather than through Builder A. In this way, the assignee purchaser can include in the new housing rebate application the tax paid to Builder A and the tax paid to the assignor in determining the amount of their GST/HST new housing rebate and, where applicable, a provincial new housing rebate.

This info sheet does not replace the law found in the Excise Tax Act (the Act) and its regulations. It is provided for your reference. As it may not completely address your particular operation, you may wish to refer to the Act or appropriate regulation, or contact any CRA GST/HST rulings office for additional information. A ruling should be requested for certainty in respect of any particular GST/HST matter. Pamphlet RC4405, GST/HST Rulings – Experts in GST/HST Legislation explains how to obtain a ruling and lists the GST/HST rulings offices. If you wish to make a technical enquiry on the GST/HST by telephone, please call 1-800-959-8287.

Reference in this publication is made to supplies that are subject to the GST or the HST. The HST applies in the participating provinces at the following rates: 13% in Ontario, New Brunswick and Newfoundland and Labrador, 15% in Nova Scotia, and 12% in British Columbia. The GST applies in the rest of Canada at the rate of 5%. If you are uncertain as to whether a supply is made in a participating province, you may refer to GST/HST Technical Information Bulletin B-103, Harmonized Sales Tax – Place of Supply Rules for Determining Whether a Supply is Made in a Province .

If you are located in Quebec and wish to make a technical enquiry or request a ruling related to the GST/HST, please contact Revenu Québec at 1-800-567-4692. You may also visit the Revenu Québec Web site to obtain general information.

All technical publications related to GST/HST are available on the CRA Web site at www.cra.gc.ca/gsthsttech .

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CURRENTLY THERE ARE OVER 50 ASSIGNMENTS FOR SALE IN RICHMOND

JOIN THE VIP GROUP AND GAIN ACCESS TO ALL OF THE CONDO ASSIGNMENTS FOR SALE IN RICHMOND B.C.

What You Will Find On Vancouver Condo Assignments:

Info on new condos and presale condos in Vancouver BC, Vancouver presales and pre-construction homes 3-12 months before sales begin.
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Richmond ASSIGNMENTS

212 23233 gilley road.

Live at the centre of it all: Hamilton Village is a dynamic, master-planned community that is taking shape in East Richmond, offering the perfect combination of style and value. These finely crafted homes designed by award-winning Rositch Hemphill Architects are at the heart of the Lower Mainland, yet miles from the noise and stress of city life. Phase One features a state-of-the-art amenity space with pool, gym, hot tub, and multi-purpose room, plus a communal garden and courtyard patio perfect for summer barbeques. At Hamilton Village, you're steps from high street shopping, public transit, and a walkable village life, all connected to peaceful parks, lush green space, and waterfront trails.

$398,800 + GST

LISTING COURTESY OF

RE/MAX Westcoast

312 23233 GILLEY ROAD

First of its kind in Hamilton, Hamilton Village has a complete master plan designed by award winning Rositch Hemphill Architects, Complete with pool, gym, hot tub and multi purpose room, plus communal garden and courtyard, Steps to Transit, Shopping, Doctors, Dentist, Community Centre, School, peaceful parks, lush green space and riverfront trails. Good size balconies for those summer bbqs. Wal Mart Shopping Mall is 5 minutes away. Est. completion by November, 2019.

$415,000 + GST

LISTING COURTESY OF

Oakwyn Realty Ltd.

305 13040 NO. 2 ROAD

Welcome to Harbour Walk - a collection of luxury homes in Steveston! With bright, open layouts, stylish design, high quality appliances & more. This third floor One Bedroom unit boasts an efficient 577 sqft of living space and 85 sqft of balcony with northern exposure. Featuring quartz countertops, stainless steel appliances and a bright colour scheme you will love calling this your home. Situated in the heart of Steveston’s London Landing - a spectacular, yet quaint waterfront community. Steps from renowned schools such as Montesorri Academy, Homma Elementary, R.A McMath Secondary and more. Easy access to daily amenities, transit, community centre and more

$450,000 + GST

RE/MAX Westcoast

320 4033 MAY DRIVE

514 5400 hollybridge way.

This Junior two bedrooms is such a great investments or self-owned property with functional layout for small family or rental purpose.It is located in the heart of Richmond, walking distance to shopping centre, supermarket, banks or restaurants. Also, unit comes with nice hardwood floors, high end appliances and air conditioning system.Great amenities like fitness gym, meeting lounge and bike room, one parking spot is included.Estimated completion spring, 2020.

$478,000 + GST

Nu Stream Realty Inc.

ASSIGNMENT OF CONTRACT in River Park Place III by INTRACORP. The project is located at Richmond’s newest & most dynamic community along the river’s edge. Junior 2 bedroom with functional layout. One parking stall and one storage locker are included. Estimated Completion Jan to Apr 2020. All measurements are approximate, Buyer to verify if deemed important.

$528,000 + GST

RE/MAX City Realty

36 7191 LECHOW STREET

Welcome to Parc Belvedere. Brand new Luxury townhomes in the neighbourhood of No 4 Road & Granville built by Dave Developments, one of Richmond's most premium home builders. 2 level luxury duplex townhouse. 9-foot ceiling, air conditioning, open kitchen with 36" French Door Refrig and 4 burner gas stove, undermount sink, soft-close cabinets, hardwood floor, garage with 2 side by side parking spots. It's about to complete in late 2019.

$1,388,000 + GST

Royal Pacific Riverside Realty

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IMAGES

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COMMENTS

Consumer Guide to Assignments
Assignments of contracts are permitted in B.C. but there are requirements and restrictions in the law that must be adhered to before an assignment can take place. In B.C., a real estate purchase contract must include a term prohibiting the assignment of the contract without the written consent of the seller. If the buyer wishes to be able to ...
What is Assignment of contract
Assignment of contract. An assignment of contract refers to the transfer of contractual rights and obligations from one party to another. In the context of business, real estate, or technology law in British Columbia, an assignment of contract may occur when a party wishes to transfer their rights and obligations under a contract to a third party.
Assignment of Contract and Purchase and Sale BC
If you're thinking about assigning your contract, give us a call today to see what's right for you: 604-765-0376. Prefer text? 604-319-0200 or email [email protected] to start a conversation. Make the home buying process straight-forward from the start. Talk to one of our realtors today. TALK TO US!
Assignment Of Contract Of Purchase And Sale In BC: What You Need To
Key Takeaways. Assignment of contract in real estate refers to the transfer of a buyer's rights and obligations under an Agreement of Purchase and Sale to another buyer before closing on the property, offering flexibility and potential profits.; Assignments are legal transactions in British Columbia but may require developer approval depending on contractual stipulations.
Assignment Terms
Assignment Terms - It's All in the Contract #546. Licensees must ensure they read the terms of real estate contracts carefully and explain them to their clients. This is especially true when it comes to assignment clauses contained within contracts. Within the past number of years, the government has imposed laws and regulations around ...
Assignments of Contract Vancouver BC / Anthony Riglietti PREC
Long Answer: An assignment of contract is a sales transaction where the original buyer of a property (the "assignor") allows another buyer (the "assignee") to take over the buyer's rights and obligations of the Agreement of Purchase and Sale, before the original buyer completes on the property. The assignee is the one who ultimately completes the deal with the vendor.
Real Estate Assignment of Contract in British Columbia
In this blog, we'll delve into what a real estate assignment of contract is, its implications, and key considerations in the context of British Columbia. Understanding the Assignment of Contract A real estate assignment of contract involves the transfer of rights and obligations of a purchase agreement from the original buyer (assignor) to a ...
Condo Assignment Sales Explained
What is an Assignment Fee in BC? An assignment fee is a sum of money developers charge to allow an assignment of contract to go forward. Developers typically charge an assignment fee of anywhere from a few dollars up to 5-10% of the assignment purchase price. Payment of the assignment fee is required before a developer will sign the assignment ...
The Assignment of Commercial Contracts in Legal Practice
Contract "assignability" is a term frequently used by contracting parties and practitioners. While they may expressly address the assignment of a party's rights under the contract in some contexts, they frequently use the term "assignment" to refer to both: The delegation of duty to perform. The assignment of rights to obtain performance.
Subletting and assigning tenancies
Subletting and assigning tenancies. Last updated on January 29, 2024. A sublet is when a tenant moves out of their rental unit and allows someone else to live there temporarily. An assignment is when a tenant finds someone to take over their tenancy agreement. Tenants need written permission from the landlord to sublet a rental unit or assign a ...
What Is an Assignment of Contract?
By Richard Stim, Attorney · University of San Francisco School of Law. An assignment of contract occurs when one party to an existing contract (the "assignor") hands off the contract's obligations and benefits to another party (the "assignee"). Ideally, the assignor wants the assignee to step into his shoes and assume all of his contractual ...
Tax Implications on Assignment of a Purchase Contract
Called "assignment of purchase" agreements, such deals have tax implications for both the person who sells the contract and the person who buys it. Any profit realized from such assignment sales must be reported by the assignor and could have varying implications. These implications include the profit being treated as fully taxable business ...
Sublet and Assignment
The Basics. A sublet occurs when a tenant temporarily moves out and rents their unit to a subtenant until they return, whereas an assignment occurs when a tenant permanently moves out and transfers their agreement to a new tenant.. To sublet or assign your tenancy agreement, you must have your landlord's written permission. See TRAC's template letter, Permission to Assign or Sublet.
CBA British Columbia
CBABC and the BC Real Estate Association hold joint copyright over the Standard Form Contracts of Purchase and Sale and related documents. They are available free of charge to CBA members. By accessing and using these forms, the CBA member acknowledges and agrees that these forms were developed by CBABC and BCREA for the use and reproduction by ...
Federal Budget 2022: Taxation of Property Flipping, GST and Assignment
A similar requirement is contained in Section 4.14 of the BCREA Assignment Contract of Purchase and Sale Non-Developer standard form. To illustrate this, let us consider how this would work for a residential pre-sale, with an original purchase price of $800,000 and an assignment purchase price of $900,000, between a Developer (who is likely a ...
New Rules re Assignments of Pre-Sale Condominium Contracts of Purchase
The Province of British Columbia is taking steps to ensure that the applicable taxes are paid on assignments of pre-sale condominiums with the introduction of Bill 25 Real Estate Development Marketing Amendment Act, 2018. The goal of the legislation is to collect the applicable tax on such assignments and to generally discourage the assignment of such contracts and reduce what the government ...
'Shadow Flipping' and New Regulations for the BC Real Estate Industry
In addition to the changes announced June 2016, Premier Clark also announced earlier on March 18, 2016 that BC would introduce new rules to require real estate vendors to consent to any assignment of real estate contracts and require that any profits from the assignment of real estate contracts go to the vendor.
Assignment of a Purchase and Sale Agreement for a New House or
Generally, the result of the assignment is that the purchase and sale agreement is then between the builder and the assignee. This publication addresses the situation where. a purchaser (referred to as the first purchaser) enters into a purchase and sale agreement with a builder (Builder A) for the construction and sale of a new house, and.
How to Sell a Presale Condo in BC: Assignments of Contract Sales
Real estate commissions will also be a cost to consider when selling a presale condo. I charge 7% on the first $100,000 and 2.5% of the balance of the assignment sale price. We offer just under 50% of this commission to a buyers agent who brings us a buyer who completes a purchase of the assignment.
Richmond
BC Goods & Services (GST) and Property Transfer Tax (PTT) Calculator (Please consult with your accountant) JOIN THE VIP GROUP. Richmond ASSIGNMENTS. 212 23233 GILLEY ROAD 212 23233 GILLEY ROAD ... ASSIGNMENT OF CONTRACT in River Park Place III by INTRACORP. The project is located at Richmond's newest & most dynamic community along the river ...