What are the rights of a purchaser when the living area of the condo delivered by a promoter is considerably smaller than advertised? This issue was discussed in Duval v. Habitats District Griffin Îlot 10 Inc., 2018 QCCS 4703 (confirmed by the Court of Appeal 2020 QCCA 1614).
Jean was living in the suburbs in the family home encompassing 2000 sq. ft. of habitable space, excluding the basement. He wanted to move closer to downtown and estimated that he would require a condo with @ 1400-1500 sq. ft. He signed a preliminary contract with Habitats to purchase a new condo advertised as comprising 1321 sq. ft. plus a loggia for a total of 1408 sq. ft.
The preliminary contract included a note that the dimensions were approximate and subject to modification without prior notice. The note also stated that the gross square footage was calculated by including 1/2 of the interior walls as well as the exterior and corridor walls.
Shortly before the closing, the certificate of location was delivered to Jean showing a living area of only 1174 sq. ft. namely, 12% less than what he expected. According to Jean, his options are very limited since the preliminary contract did not allow him to withhold any amount from the purchase price. Moreover, he had already advanced between $50,000 to $60,000 for high end materials so that the interior finishing of the new condo would meet his expectations of superior quality. In the circumstances, he proceeded with the closing and took possession of his condo.
Jean claimed a reduction in the purchase price to reflect the reduction in the living space of the condo compared to what he expected and declared that he was promised. Habitats argued that by closing without reserving his rights, Jean implicitly renounced any claim that he may have had. Subsidiarily, Habitats states that the dimensions of the condo were gross and only approximate and that it never made any representations or promises regarding the dimension of the livable area.
The Court found that according to the evidence, Habitats led Jean to believe that the livable area of the condo would be 1318 sq. ft. and that it was an important consideration for Jean when he agreed to purchase the condo. This constituted a false representation which was actionable both pursuant to Articles 1401 and ff. of the Quebec Civil Code as well as Articles 216 and ff. of the Consumer Protection Act.
The Court also found that Jean never renounced his rights by closing without reserve since the cancellation of the contract was not a viable option for the reasons hereinabove mentioned. In the circumstances, the Court granted Jean a reduction of the purchase price in the amount of $73,000.
Article 1720 of the Quebec Civil Code requires the seller to deliver the area or quantity specified in the contract unless it is obvious that the property was sold without regard to such factors. In this case, the Court concluded that the size of the habitable space was an important consideration for Jean.
The restriction in the contract regarding the dimensions of the property did not prevail based upon the specific facts of this case namely, that according to the Court, Habitats provoked Jean into error by confusing gross area with net living space. Habitats would have been better served to consider the adage: the primary objective of good communication is not to be understood, but rather to avoid being misunderstood.
No comments:
Post a Comment