Humber/Ontario Real Estate Course 4 Exam Practice

What step should be taken by a buyer's lawyer if encumbrances are found on the chattels included in a property sale?

1. List encumbrances in the statement of adjustments.

2. Remove the chattels from the agreement.

3. Send a requisition letter to the seller's lawyer.

4. Refuse to close the sale.

5. Settle the encumbrances separately.

6. Notify the buyer about the issue.

The correct answer is: Send a requisition letter to the seller's lawyer.

If encumbrances are found on the chattels included in a property sale, the correct step for the buyer's lawyer to take is to send a requisition letter to the seller's lawyer. By sending a requisition letter, the buyer's lawyer is formally requesting information or clarification regarding the encumbrances on the chattels. This action allows the seller's lawyer to provide necessary details or resolve any issues before the closing of the sale, ensuring that both parties are informed and any concerns are addressed. Option A is incorrect as listing encumbrances in the statement of adjustments does not directly address the need for clarification or resolution of the encumbrances. Option B is not typically done without further discussion or resolution attempts. Option D is not the first step to take when encumbrances are found; attempting to resolve the issue through communication is usually the initial approach. Option E may be a possible course of action but sending a requisition letter first is usually the appropriate step. Option F is also not the primary step to take; direct communication between the lawyers is the typical protocol in such situations.