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Tag: representations

Real Estate law: Can You Refuse to Close if Your Condominium Square Footage is Less Than You Bargained For?

In real estate law, representations are very important elements to any agreement of purchase and sale.  Typically the party selling the property will represent things such as the size of the land, the size of the dwelling, that the chattels and fixtures included in the purchase price are free and clear of encumbrances and in working order, etc.  In law, a representation is defined as a statement of past or present fact without the statement necessarily also being a promise, although the law has recognized that a representation can be both a promise and a representation.  While the topic of representations in contracts is extremely comprehensive, 756289 Ontario Limited et al. v. Milan Harminc, (1998) CarswellOnt 1577, 98 G.T.C. 6206 (“Harminc”) is one example of where a representation affected a real estate transactions with respect to the representation of square footage.Harminc is a case wherein a buyer purchased a commercial condominium property from a builder.  The buyer refused to close and the builder sued the buyer for breach of contract and sought damages.  While the defendant buyer advanced a number of arguments for his defence, the case turned on whether the builder misrepresented to the buyer the square footage of the property and if so, whether that misrepresentation was material enough to entitle the buyer to rescind the contract and refuse to close.

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Real Estate Law: What the Difference is Between a Condition and a Warranty and Writing the Agreement of Purchase and Sale

One of the most important things I stress to Realtors and purchaser clients is to make sure it is very clear in the agreement of purchase and sale that everyone knows exactly what is being bargained for and the agreement is structured and contains clauses towards that intent.  An older case, Jorian Properties Ltd. v. Zellenrath (1984 CarswellOnt 1376; 46 O.R. (2d) 775, 26 B.L.R. 276) (“Jorian”) is a helpful guide that illustrates some these issues.In Jorian, the Purchaser entered into an agreement of purchase and sale with the vendor to purchase a legal five-plex (“Property”).  Upon the Purchaser’s lawyer’s search to the relevant zoning authority, it was discovered that the Property was only a legal triplex.  The Vendor who had represented that the property was a legal five-plex did not know that the Property did not comply with zoning.  After some negotiation with respect to an abatement of the purchase price, the Purchaser refused to close the transaction and then sued the Vendor for damages.  Evidently the Purchaser strongly desired the Property because the Purchaser wound up purchasing the same Property from a subsequent purchaser that the Vendor sold the Property to for a higher price, .

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REAL ESTATE: Latent & Patent Defects when purchasing a home. Need a home inspection?

Latent defects in the eyes of the law applicable at the time when administering the sale of a real estate property (land, buildings and fixtures or chattels), are faults or shortcomings in the property not ordinarily found even though the inspection was reasonably thorough. For instance, there could be a disused underground fuel tank in the property, its filling line, vent, etc. removed or gone. It would be very difficult

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THE AGREEMENT OF PURCHASE AND SALE: Not Just Used In Real Estate!

An agreement of purchase and sale is a major key document in negotiating to buy and sell an asset. This is an agreement between the seller and the purchaser. It is legally made to deal with the transfer of the asset with regard to its purchase value, payment arrangements, warranties of the seller, representations on the asset, terms of how the transaction is to take place, conditions precedent to firming the deal,

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Terminate Commercial Tenancy…Beware of the Pitfalls

I am lucky enough in my practice to handle a fair bit of commercial landlord/tenant disputes.  I find this work challenging and rewarding, primarily because my clients’ interests and needs are real and immediate.  Without fail, the most common problems I need to address are those of Landlords who want to terminate a tenant’s tenancy before the expiry of the lease term.  In this blog entry, I am going to discuss the

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Business Purchase Gone Wrong

You decide to purchase a business– either to consolidate the market, or enter into a new venture. After a hard fought negotiation and many wrinkles in arranging for financing, it’s now time to close the deal and take control of your new expanded enterprise. In some cases, this is where the headache begins.

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Understanding the Standard Agreement of Purchase and Sale – Part 1

Often my clients have their realtors prepare their agreements of purchase and sale without fully understanding the clauses that are inserted. Most real estate clauses contained in the schedules of the standard Ontario Real Estate Association (OREA) Form have become very standard however, purchasers and vendors should be aware of what is contained in their agreements. Below are some of the items to look out for on a

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