Bora Laskin's Statement About Vendor's Liability

Bora Laskin on Vendor's Liability For Patent and Latent Defects

By Brian Madigan LL.B.

(Ontario Real Estate Source)


The commencement of any legal discussion about liability for defects whether they be latent or patent begins with the following statement from Bora Laskin:


"Absent fraud, mistake or misrepresentation, a purchaser takes existing property as he finds it, whether it be dilapidated, bug infested or otherwise uninhabitable or deficient in expected amenities, unless he protects himself by contract terms".

That statement made in the Law Society of Upper Canada's Special Lectures (1960)on the Sale of Land summarizes the law. Bora Laskin was at that time, a Professor of Law at the University of Toronto Law School. Among other subjects, he taught Real Estate.

His analysis of the law was superb, and it always made good sense. His essays on the law were often quoted by Judges in their legal decisions. He was appointed to the Ontario Court of Appeal, (Ontario's highest court), and later to the Supreme Court of Canada where he became the Chief Justice.

It is noteworthy that comments, opinions, and summaries of the law by Bora Laskin ultimately found their way into the law. If Bora Laskin said it, and it isn't the law now, then it soon will be. The legal system is just waiting for the "right case".

The full quotation is as follows:

"Does the vendor have any duty of disclosure in matters of quality and fitness which do not constitute defects of title?"

That was Laskin's question and hypothetical question and what follows is his reply:

"Here we deal with the classical notion of caveat emptor as applied to the physical amenities and condition of the property unrelated to any outstanding claims of third parties or public authorities as would impinge on title.

Absent fraud, mistake or misrepresentation, a purchaser takes existing property as he finds it, whether it be dilapidated, bug infested or otherwise uninhabitable or deficient in expected amenities, unless he protects himself by contract terms.

.....

I do not propose to dwell on fraud, mistake or misrepresentation save to make a few observations about the way in which, if established, they relieve a purchaser from the binding effect of caveat emptor.

Fraud can be a rather elastic conception, and there are cases that show a tendency to show fraud when there has been concealment by the vendor of latent defects.

Rowley v. Isley, a British Columbia decision entitling a purchaser to rescind (even after paying the price and taking possession) where there was a failure to disclose infestation by roaches, illustrates the proposition, and goes quite far in allowing rescission after the transaction had been closed.

On the other hand, a latent defect of quality going to fitness for habitation and which is either unknown to the vendor or such as not to make him chargeable with concealment or reckless disregard of its truth or falsity will not support any claim of redress by the purchaser.

He [the purchaser] must find his protection in warranty."


And, that still appears to be a correct statement of the law in Ontario, some 50 years following the delivery of the lecture.


Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage
905-796-8888
www.OntarioRealEstateSource.com