OPTIONAL GUARANTEE PLANS

Optional guarantee plans are sometime offered, for buildings not covered by the Guarantee plan for new residential buildings (compulsory guarantee plan). This form of guarantee is intended for those buildings comprising five or more superimposed private portions , and buildings renovated and converted into co-ownership (such as: abandoned factories, schools and churches). The optional guarantee plans are managed by the “APCHQ”, the “ACQ” and the “APECQ”.

The rules governing these guarantee plans are quite different from those of the Guarantee plan for new residential buildings and they are different from an administrator to another. Consumers are often confused on the scope of these guarantees

The protections offered

These guarantee plan usually include partial protection of the deposits, the repairs of apparent defects and the achievement of the work. Some protection is also offered for hidden and construction defects.

Delay to present a claim

For the syndicates of co-owners, these plans generally specify time limits to present a claim which start to run from the day of the registration of the declaration of co-ownership or the day when the immovable is ready for the use for which it is intended. However, during the first year of existence of a co-ownership, the syndicates of co-owners often remains  under the control the developer, who appoints a provisional administrator which is generally a person with close ties with him.

This complicity has a downside, and the provisional administrator does not always take care of the claims for indemnification in the time limit. Consequently, when a new Board of Directors is elected, after the loss of control of the developer on the co-ownership, it is sometimes too late to present a claim as the time limit has elapsed.

Furthermore, under the optional plans the period of the guarantees is shorter, coverage is lower and deductibles higher.  These limitations and the high handling cost of opening a claim’s file, cause the syndicates of co-owners and the co-owners to hesitate to exercise their rights, when needed. They, nevertheless, should present a claim as the stakes are worth it.

 WHAT YOU SHOULD KNOW! Developers are not required to cover their buildings with an optional guarantee plan. Furthermore, the content of optional guarantee plans is different from one project to another. The purchaser should therefore enquire and get the necessary information on the content of his guarantee at the time of signing the preliminary contract.

 WHAT TO KEEP IN MIND: Before trusting a contractor and giving him a deposit, carry out the necessary verifications on the scope of the guarantees offered. Furthermore, obtain a warranty certificates of the building and a written confirmation from the administrator of the optional guarantee plan (“APCHQ”, “ACQ” or “APECQ”) that the project has been registered with him.

 WARNING! Co-owners have a tendency to overestimate the protection offered and   the scope of these guarantees, thereby creating a false perception that every residential immovable is well-built. The awakening is sometimes rude, more particularly when large buildings are affected with construction defects and the special assessments for large amounts.

 

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