Focus On

SALE OF LAND - Agreement of purchase and sale - Counter-offer - Notation that effects no change

Wednesday, February 06, 2019 @ 8:08 AM  


Lexis Advance® Quicklaw®
Appeal by the plaintiff from summary judgment ordering forfeit of a deposit paid to the defendants under a real estate agreement. The defendant vendor owned a detached residential home on an irregular corner lot. The property was listed for sale at a price of $1.2 million. The defendant real estate agent was unable to obtain the complete lot dimensions and measured them himself for the purpose of including the dimensions in the sale listing with the qualifying words, "more or less". The plaintiff submitted an offer on the property that expressly included the lot dimensions from the listing. The defendants submitted a counter-offer that added the words, "to be verified" to the lot dimensions. The plaintiff accepted the counter-offer and paid a deposit of $100,000. Thereafter, the plaintiff investigated the actual dimensions of the lot, finding they were less than stated on the listing. The plaintiff sought a reduction in the purchase price. The defendants refused, and the transaction failed to complete. The plaintiff sued, seeking return of the deposit. The parties agreed to resolve the matter by way of an application for summary judgment. The motion judge dismissed the plaintiff's action and ordered forfeiture of the deposit. The plaintiff appealed.

HELD: Appeal allowed. The motion judge erred in his interpretation and legal effect of the "to be verified" proviso by finding that it imposed an obligation on the plaintiff to verify the dimensions of the property prior to executing the purchase and sale agreement. The proviso should have been interpreted as simply stating that the lot depth dimension had to be verified. Its accuracy was not to be taken as a representation by the vendor. Nothing in the wording used showed an intent or effect to transfer the risk of the inaccuracy of the depth dimension to the purchaser, or to remove the effect of the words "more or less", which remained in the agreement. Given the motion judge's finding that the discrepancy in the dimensions was outside of the scope of the "more or less" wording, the plaintiff was entitled to resile from the agreement and receive the return of his deposit. The summary judgment order was set aside, and the plaintiff was granted judgment for the return of the deposit.

Hosseinzadeh v. Pringle, [2018] O.J. No. 6537, Ontario Court of Appeal, K.N. Feldman, K.M. van Rensburg and I.V.B. Nordheimer JJ.A., December 12, 2018. Digest No. TLD-February42019006