LAW 703 Lecture Notes - Lecture 3: Flooring, Implied Warranty, Condition Precedent
LAW703 – Lecture 3
Chapter 6 – Physical Defects
Caveat Emptor – Buyer Beware
Applies to completed buildings and resale of completed buildings
Subject to ONHWP
Seller does not have an obligation to disclose defects
oSubject to exceptions – Page 410
Remedies page 410
oIf seller chooses to make statements, they must be true and complete
Laissez Faire – Free Bargaining
Buyer protect yourself
Due to caveat emptor, buyer must protect themselves by contract:
1. Condition precedent on building inspection;
2. Representation and warranties from seller and
3. Seller property inspection statement (SPIS) – Pages 17-19
Agreement of Purchase and Sale (APS)
Clause #13 – Inspection (Slide 6)
Clause #23 – UFFI (Slide 7)
Clause #26 – Agreement in Writing (Slide 8)
Insert Condition precedent upon inspection
Insert additional representation and warranties from seller
Caveat Emptor – Exceptions (Page 410 / Slide 11)
1. Express Contractual Warranties
2. Common Law implied Warranties
3. Statutory Warranties – ONHWP
4. Misrepresentation
5. Silence amounting to misrepresentation
6. Half-truth amounting to misrepresentation
7. Active concealment of defect (fraud)
8. Error in substantialibus
9. Sellers duty to disclose known latent defects in property that go to habitability, health or
safety
10. Sellers duty to disclose known latent defects in the neighbourhood going to health and
safety
Misrepresentation – False statement of material fact that buyer relied on and induced the
buyer into the APS.
Hoy V Lozanovski – Seller silent regarding termites. Buyer has a professional inspection
don and therefore did not rely on misrepresentation. – page 416
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
Applies to completed buildings and resale of completed buildings. Seller does not have an obligation to disclose defects: subject to exceptions page 410. Remedies page 410: if seller chooses to make statements, they must be true and complete. Due to caveat emptor, buyer must protect themselves by contract: condition precedent on building inspection, representation and warranties from seller and, seller property inspection statement (spis) pages 17-19. Clause #26 agreement in writing (slide 8) Misrepresentation false statement of material fact that buyer relied on and induced the buyer into the aps. Hoy v lozanovski seller silent regarding termites. Buyer has a professional inspection don and therefore did not rely on misrepresentation. Fraser v knox seller silent regarding water in basement. Buyer relied on professional inspection therefore not misrepresentation. Tony"s broadloom and floor covering v. ncm canada page 438. Active concealment of defects tantamount to fraud.
