Tax Sale properties in Quebec

Sale of immovables for non-payment of taxes in Quebec

Every year properties across Quebec go up for auction due to unpaid municipal or school taxes. In Quebec they use the term Immovable property instead of a property.

Professional Canadian real estate investors can invest in these properties for short or long term substantial gains.

Immovable property is an immovable object, an item of property that cannot be moved without destroying or altering it – property that is fixed to the earth, such as land or a house.

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Each province in Canada has different set of laws and rules. Tax sale properties in Quebec have to follow certain laws to protect home owners as well as the municipalities. There are 1,111 municipalities for approximately 8 million residents. Of Quebec’s 1,111 municipalities, 640 or 58% of them are simply “municipalities”. Of the remaining 471, there are 158 parishes, 223 towns, 44 townships, 2 united townships and 44 villages. Despite still being a legal municipal status, there are no longer any cities in Quebec.

Sale of immovables for non-payment of taxes in Quebec

The Law on cities and towns provides that municipalities have the right to sell a property when the municipal or school taxes are not paid.  While this method of collection does not require a prior judgement it is, however, governed by rigorous procedures.

Council Order for Tax sale properties in Quebec

After the expiration of the six months that follow the date of the notice of the filing of the tax roll, the treasurer is required to prepare a report indicating the immovables for which the taxes imposed have not been paid, in whole or in part.

After reviewing the report produced by the treasurer, the council can order the town clerk to sell the immovables at public auction, on a specified date.

Publication of the list in a local newspaper for Tax sale properties in Quebec

In the 30 days following the council order, the town clerk advises the public of the date, time and location of the sale by auction.

This notice must contain the designation, according to the provisions of the civil code, of the buildings that will be put on sale indicating the name of the proprietor as shown on the evaluation role, the address of the property to be sold, the cadastre number or numbers and the amounts due at the time when the notice was produced.

The list of immovables in default of payment of taxes is published on two occasions in a newspaper. The sale by auction cannot take place before the expiration of a 15 day delay following the date of the second publication.

Publication of the list of immovables at the land registry office

Following the first publication of the notice in the newspaper, the town clerk must immediately forward a copy of the notice to the officer at the land registry office. The land registry officer must inform the interested parties registered on the land registry (mortgagees, mortgage holders, co-owners of condo-type buildings, etc.).

Transmission of the notice to the proprietor for Tax sale properties in Quebec

Until the date of the sale, the proprietor of the immoveable to be sold has the right to remove their immoveable from the process. Following the first publication of the notice, the town clerk of the municipality must send a registered or certified letter, in which the total amount to be paid is indicated.  The proprietor must contact the municipality or send the payment by mail, in order to acquit the debt. Payment must be made in cash, certified cheque or postal order (bank drafts are also accepted, no later than the day prior to the day set for the sale.)

Conditions for bidding on Tax sale properties in Quebec

Any individual who wishes to bid is invited to register at the date and location set for the sale.

A physical person who would like to submit a bid must:

1- Declare before the town clerk, their full name and place of residence;

2- Present one of the following documents that proves their identity and includes a photograph:

a) Drivers’ license;

b) Medical insurance card;

c) Passport;

3- Provide a power of attorney or mandate if they wish to bid for another physical person;

An individual who wishes to submit a bid for a moral person must:

1- Provide a copy of the resolution, power of attorney or other document indicating the name of the representative authorized to

bid, certified by the president or the secretary of the moral

2- Companies and corporations must file a copy of their act of incorporation;

Adjudication for Tax sale properties in Quebec

The immovables are sold with the buildings that are erected on them and, if applicable, everything else that is found there on the date of the auction sale with the active, passive, apparent or hidden servitudes against them without warrantee and without legal guarantee.

The price of the adjudication for each of the immovables is set by the amount of unpaid taxes, the accumulated interest and the fees related to the sale.  The total amount must be paid immediately in cash, postal order, bank money order or draft or by certified cheque made payable to the City.

The immoveable is awarded to the highest bidder who becomes the adjudicator of the building. The successful bidder receives a certificate of adjudication for the immoveable.  They become the guardian of the immoveable and can only take actions that are specified in the law.

The municipality can bid and acquire one or more of the immovables through a person authorized by the council. The municipality’s bid must not however, in any case, exceed amount of the taxes, interest and fees, plus an amount sufficient to satisfy any prior debt or mortgage of a rank below or equal to that of the municipal taxes.

Redemption Right for Tax sale properties in Quebec

Any proprietor of an immoveable sold for default of payment of taxes, or their legal representatives, has a delay of one year following the adjudication to retake possession of their immoveable upon payment to the successful bidder of the entire amount of the bid, the inherent costs with interest at a rate of ten per cent (10%).  The successful bidder cannot in any way object to the right of redemption.

Act of definitive sale for Tax sale properties in Quebec

If, after the expiration of the one year delay, the proprietor or his representative has not taken advantage of their right of redemption, the successful bidder can have a contract of definitive sale drawn-up at their own cost by the notary of their choice. The registration of the deed of sale acts to cancel the registration of mortgages registered against the property and that are extinguished by the sale.

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