The PDS: What Buyers and Sellers Need to Know After a Key Court Decision
If you're buying or selling real estate in North or West Vancouver, you're likely to encounter a document called the Property Disclosure Statement (PDS). This form is commonly used in British Columbia to provide buyers with information about the condition of a property.
However, a recent decision by the B.C. Court of Appeal has changed how the PDS may be interpreted in real estate transactions — and it's important for both buyers and sellers to understand the implications.
A Shift in How the PDS is Viewed by the Courts
In the case Sewell v. Abadian, the seller chose not to complete the PDS, crossing out all the questions and simply noting that the property had been tenanted and not owner-occupied. This struck-out PDS was incorporated into the final contract.
The buyer made a subject-free offer and, after placing their deposit but before closing, discovered that the property included unpermitted work. They attempted to back out of the contract, alleging misrepresentation.
While the initial court ruling favoured the seller, the B.C. Court of Appeal reversed that decision, finding that simply including the PDS in the contract — even if it was blank or struck out — could still create a legal expectation of disclosure.
Notably, the seller had been aware of the unpermitted addition, as it had been disclosed to him when he purchased the property. Despite this knowledge, he chose not to disclose it to the buyer, which was a key factor in the Court’s decision.
This ruling marks an important change from previous industry practice. Historically, crossing out the PDS and including a phrase like “as is, where is” was understood to mean that no representations were being made. But the Court clarified that this is not how such actions should be interpreted. Instead, a struck-out PDS may be viewed as an assertion that the seller has no knowledge regarding the items in question — not as a waiver of responsibility.
This decision introduces greater legal risk for sellers and underscores the need for careful handling of the PDS.
What Sellers Should Know
You Are Not Required to Complete a PDS — But Be Careful How You Opt Out
There is no legal requirement to complete a Property Disclosure Statement. In situations such as estate sales, tenanted homes, or when the seller lacks detailed knowledge of the property, opting not to complete the form may be appropriate.
However, the Sewell ruling establishes that striking out the PDS and including it in the contract may not shield the seller from liability. Even a blank or crossed-out form may be interpreted by the court as the seller asserting they have no knowledge — a form of representation in itself. If that turns out to be untrue, the seller may be exposed to legal claims.
Best practice now is to omit the PDS entirely from the contract if the seller does not wish to make representations. A clear written statement — ideally drafted with legal input — should confirm that no representations or warranties are being made.
If You Do Complete It, Be Precise
If you decide to complete a PDS, treat it seriously. Vague or partial answers can be misleading and may lead to legal disputes. Provide honest, fact-based responses. If you're uncertain about a question, say so — and consider obtaining legal advice.
Latent Defects Must Still Be Disclosed
Regardless of whether a PDS is used, sellers are legally required to disclose known material latent defects. These are issues that:
- Are not visible during a typical inspection,
- Could pose a safety risk or health hazard, or
- Make the property unfit for living.
Your Realtor can help ensure that these disclosures are properly documented in writing.
What Buyers Should Know
The Absence of a PDS Is Not Unusual
Some sellers may choose not to provide a PDS — and this is common in cases involving rental properties or estates. However, this means buyers must take extra care in their investigations. The lack of a PDS should be viewed as a prompt for more due diligence, not less.
You Can Still Request a PDS
Even if a seller hasn’t initially offered a PDS, buyers can request one during negotiations. While sellers are not obligated to provide it, doing so may give buyers added confidence and can support financing in some cases (lenders may require it).
Ask Targeted Questions
If no PDS is available, or if it appears incomplete, ask clear, specific questions about the property’s condition and history. For example:
- Have there been any past renovations or repairs?
- Were any permits obtained?
- Have there been any issues with water damage, pests, or structural concerns?
Buyers should also review other available documentation, such as city permits, inspection reports, and strata documents if applicable.
Understand the Legal Meaning of a Struck-Out PDS
If a PDS is provided but has been crossed out or left blank, do not assume this means the seller is refusing to make any statements. Under the current legal interpretation, this may still be viewed as a representation that the seller lacks knowledge of the items listed. If you suspect the seller may have information that hasn't been disclosed, follow up in writing or through your Realtor to seek clarification.
A Professional Home Inspection is Valuable
Whether or not a PDS is provided, an independent home inspection is prudent. If there are gaps in disclosure or unanswered questions, this step becomes even more important. For older homes, heritage properties, or those with visible issues, additional inspections from structural, electrical, or plumbing specialists may also be warranted.
Final Thoughts
The recent court ruling means the Property Disclosure Statement carries more legal weight than many buyers and sellers might assume — especially when the form is blank, struck out, or incorporated into the contract.
If you're buying or selling in North or West Vancouver, this makes it more important than ever to:
- Understand your rights and responsibilities,
- Document everything clearly and accurately, and
- Seek professional guidance when you're unsure.
Whether you're filling out a disclosure form or reviewing one, working closely with an experienced Realtor and legal advisor can help you avoid surprises and move forward with confidence.
If you have questions about how this ruling may affect your transaction or how to properly use the Property Disclosure Statement, feel free to contact our team for guidance.