November 11th - 2006

Merv's Column: What was bargained for?

When the buyer inquired about the property, the real estate agent represented that the land size was 81.00 feet x 143.00 feet or 11,583 square feet.

"When the buyer inquired about the property, the real estate agent represented that the land size was 81.00 feet x 143.00 feet or 11,583 square feet.

Subsequently, he gave the buyer a site plan with precise measurements that showed an irregular seven-sided parcel of land. Shortly before closing, the buyer's architect calculated the square footage from the site plan, concluding that it was around 9,320 square feet. Even without doing the calculations, it was apparent or ought to have been apparent to the buyer that the land size could not be 11,583 square feet, given the measurements on the site plan.

The trial judge was “incorrect that the seller's agent was also the buyer's agent at the time the representation was made. Nevertheless, the buyer could not have been misled by the representation of the agent once he reviewed the site plan. Also, there was evidence that the buyer was familiar with the property and had inspected it on two occasions. The property was described in the Agreement of Purchase and Sale by municipal address and by legal description as having a frontage of 80 feet more or less by a depth of 143 feet more or less. Both parties had to have known that these measurements did not correctly describe the size of the property. Even if there was a misrepresentation, there is an "entire agreement" clause in paragraph 26 of the agreement. If the buyer was buying square footage, he could have made square footage a term of the agreement and he did not do so."

985813 Ontario Ltd. v. Tavares, 2005 CanLII 41550 (ON S.C.D.C.)

MERV'S COMMENTS
The appeal court agreed with the trial judge that the buyer bargained for a block parcel of land and this is what he received. If the buyer wishes to base the price on foot frontage or area or number of acres or some other calculation it is easy to say so in the offer. It may also be wise to provide for a survey or other acceptable confirmation to be done and any necessary adjustment to be made in the purchase price by an Amending Agreement.

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