The signing of the preliminary contract binds the parties, (yourself, the developer or builder).
This being said, the Civil Code of Quebec provides that you have the right within a period of 10 days to unilaterally cancel this contract, which means that you can walk away from your undertaking to purchase (right of withdrawal) without any justification. This "right of withdrawal" may be exercised by any promisor who is a natural person and who intends to occupy the apartment being the object of the preliminary contract.
Consult a notary or lawyer
This period of time is deemed sufficient to allow you to examine ( in peace ) the scope of the contract you have signed and to consult a competent professional (lawyer or notary) to obtain independent advice from a knowledgeable person. This professional may recommend terminating the contract, if he is of the opinion that it includes detrimental terms and conditions. In the event you wish to start a new round of negotiations with the vendor, he will be capable of suggesting (if appropriate), deleting or adding provisions to the contract to protect your interests. This exercise should establish a better balance between the parties.
In some cases, the contract provides expressly that the right of withdrawal is under reserve of the payment of an indemnity not exceeding 0.5% of the agreed sale’s price. In any case, the vendor has no choice; he must accept your withdrawal, which will terminate the preliminary contract.
How to calculate the ten day period?
The countdown starts on the day following the day on which every party has signed the preliminary contract;
The last day is entirely included within the 10 day period (until 11:59 min. and 59 sec. p.m.).
For example, if you have signed the preliminary contract on a Monday, and the representative of the developer signed it two days later, on the Wednesday, the period will start running on the Thursday, as the contract was formalized the preceding day.
On the other hand, if the preliminary contract imposes the remittance of an information note, the countdown will start only on the day following the day on which you have received this document. A preliminary contract signed on May 1st, but for which the information note is forwarded to you only on August 1st of the same year, will allow you until August 11th to exercise your right of withdrawal. In order for this right to be legally enforceable, you must notify the developer, ideally in writing, that you have the intention of terminating unilaterally the preliminary contract. To this end, it is suggested to send the notice of resiliation by registered mail, which will be your proof of the date you have sent it.
Once the said period has elapsed, you will no longer be allowed to terminate your preliminary contract unilaterally. In order to withdraw, you will need to negotiate with the developer, which could mean the partial or total loss of your deposits, depending on the provisions of your preliminary contract.
To avoid any misunderstanding, require an acknowledgement of receipt of the preliminary contract. You will therefore be able to establish with certainty the exact moment from which the delay to exercise the right of withdrawal or any other delays in the contract start to run.
WHAT YOU SHOULD KNOW! If the preliminary contract does not provide for a right of withdrawal of ten days, case law recognizes the existence of this right. Furthermore, be aware that the developer or builder does not have the right to ask you to renounce to your right of withdrawal.
WHAT TO KEEP IN MIND: During the period of 10 days allowed to resiliate your preliminary contract, it is recommended that you consult a professional (lawyer or notary) to obtain an opinion on the scope of the commitments you have undertaken in the preliminary contract.
WARNING! You must be extremely cautious before signing a preliminary contract, as over and above the negotiations related to the sale’s price, the payment of deposits, and the inclusions and exclusions, this document includes general conditions (on the back side) written in small lettering. These terms and conditions are often not taken into account by the consumers. Yet, they may contain provisions extremely detrimental to your rights.
CONSULT THE PUBLICATION: Purchase and sale of a condo: Everything you should know at pages 138 and following.