Definition : Guarantee plan for new residential buildings

Suretyship offered by an agency intended to guarantee in part the quality of construction of new residential buildings. There are two different types of guarantee plans: a compulsory guarantee plan for new residential buildings, governed by the Regulation respecting the guarantee plan for new residential buildings, and optional guarantee plans which cover, in certain cases, specific types of buildings.

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L’inspection préréception constitue une étape incontournable au moment d’acquérir une propriété neuve. Réalisée de manière rigoureuse et consciencieuse, il s’agit d’une excellente manière de protéger les acheteurs en cas de pépin. Nous vous présenterons dans cette chronique ce que les acheteurs doivent savoir sur l’inspection préréception de la partie privative et sur l’inspection préréception des parties communes de leur immeuble détenu en copropriété divise. Dans le marché de la copropriété neuve, le plan de garantie obligatoire administré par GCR couvre les immeubles détenus en copropriété divise de quatre unités superposées ou moins ainsi que les maisons unifamiliales isolées, jumelées ou en rangées détenues en copropriété divise. Les « tours à condos » ne sont toutefois pas couvertes par le plan de garantie obligatoire.
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La Cour supérieure du Québec a rendu jugement, le 25 janvier 2022, concernant le champ d’application du Règlement sur le plan de garantie des bâtiments résidentiels neufs, lorsqu’il prévoit, à l’article 2 (1) 2 b), que le plan de garantie obligatoire s’applique, en matière de copropriété divise principalement résidentielle, entre autres à « un bâtiment multifamilial comprenant au plus quatre (4) parties privatives superposées, sans tenir compte, dans le calcul de ces quatre (4) parties, des espaces privatifs dont la destination est le stationnement ou le rangement ».  
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The Regulation respecting the guarantee plan for new residential buildings regulates the liability of the contractor (developer) for any problem related to the quality of the construction work. In this regard, this regulation has provided for a specific protection regime for divided co-ownership. Whether it is a private or common portion, a co-owner or the syndicate of co-ownership is entitled to ask the contractor or the administrator of the guarantee plan, namely the Residential Construction Guarantee (GCR), to carry out this work, at any time during the term of the protections.  
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In 1999, the Government of Quebec introduced a Regulation respecting the guarantee plan for new residential buildings to protect the owners of new homes and certain condominiums. This regulation, prepared in the wake of the government guidelines proposed at the Summit on the Construction Industry in Quebec in the fall of 1993, was intended to respond to consumers' concerns about the too often dubious quality of construction in the residential sector and the many frustrations they experienced while trying to assert their rights. The implementation of this regulation is the responsibility of the the Régie du Bâtiment du Québec (RBQ). Its mandatory nature distinguishes it from optional guarantee plan offered on the market.  A look at the different facets of this new home warranty plan:
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Until December 31, 2014, the mandatory warranty plan was administered by various organizations associated with the builders' associations, namely The APCHQ's New Home Warranty, The Abritât Guarantee Inc. and Qualité Habitation. In order to eliminate any appearance of conflict of interest, the Regulation respecting the guarantee plan for new residential buildings has been amended. Thus, the government constituted a regulatory framework allowing the creation of a new single joint body in this area, which would be made up, in part, of as many consumer representatives as manufacturers.  
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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”.
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Building a condominium requires major investments on the part of a developer. This is the reason why a down payment will be required upon signing the preliminary contract for the desired condo unit. The Civil Code of Quebec provides that “any amount paid on the occasion of a promise of sale is presumed to be a deposit on account of the price, unless otherwise stipulated in the contract”.This down payment, which represents the first installment to the seller, varies according to the unit’s total price. Bill 16 introduced provisions to protect down payments made by residential buyers to developers and builders of divided co-ownerships.  
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There are two different types of guarantee plans: a compulsory guarantee plan for new residential buildings, governed by the Regulation respecting the guarantee plan for new residential buildings, and optional guarantee plans which cover, in certain cases, specific types of buildings.
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