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Sankarsingh v. Ali, 2019 ONSC 5655

Sankarsingh v. Ali, 2019 ONSC 5655

SUMMARY: Firm offer, buyer failed to close.

Sellers claim that the only reason the Buyers failed to close was “because they came to regret entering the agreement after an unexpected downturn in the real estate market”.

Buyers plead that they were “induced into entering the agreement through a misrepresentation regarding the size of the property” and that the difference was material and resulted in their inability to obtain financing.

Property was originally listed for $649,900 with the seller’s hopes of receiving multiple offers.

The lot is “Irregular” [narrower at one end and wider at the other].

The MLS® listing did not note that the lot was irregular.

8 offers were received on the property.

The buyer’s offer was conditional on financing and inspection.

The buyer’s offer was signed back “firm” with the conditions struck.

The Agreement of purchase and sale did not make mention of the lot irregularity.

In the schedule of the agreement, the buyer’s offer had a provision stating “Seller agrees to supply the Buyer with the copy of the survey of this property within 10 days from the acceptance of this offer, showing all existing buildings and structures if available.” Immediately after this typewritten text, the following is handwritten in block text: “IF AVAILABLE”.

No survey was available and was not provided.

The buyer’s lawyer did not send the requisition until 3 days after the “requisition deadline” in the agreement.

On the date set for the closing, the buyer’s solicitor stated that they needed additional time to close.

The buyers subsequently asked for an abatement on the price on the date that the deal was schedule to close subsequently “as the appraisal of the property value became a big issue in their mortgage” Which the seller’s rejected and the Seller’s lawyer indicated that “No one has attended the property for an appraisal. Your client claimed to have a 50% down payment so appraised value should not be an issue even if an appraisal has been done without attending the property.” Further, he closed by noting that: “This transaction is scheduled to be completed today, please advise if your client is in a position to complete the transaction or is prepared to waive tender.” The transaction did not close.

The buyer argues that he only became aware of the fact that the lot size was inaccurate when we obtained a copy of the survey from the city and argues that the property would never have been purchased at the agreed price if he knew that there was a discrepancy. And further that they were unable to obtain financing as the property did not appraise for the agreed price of $850K.

During cross-examinations on the buyer’s affidavit, the buyer testified “he was planning on living in the home with his wife and five children”. At a later point, he stated “he had been planning on tearing down the home and building a new one”. No such claim was made in either the statement of defense or on his affidavit. He also acknowledge that he never saw the appraisal.

Property was relisted after the buyer failed to close. No offers were obtained, and the price was reduced. Eventually, 1 offer was received for $740,000 and was settled at $746,000 and successfully closed.

The sellers argue that the fact that the lot was narrower at the rear would have “ been readily apparent to the defendants when they inspected the property”. And further that the buyers agreed to purchase the property in a heated real estate market, which cooled, and they wanted a reduction in the price.

The Buyers argue that there was a misrepresentation re the dimension of the property and that this was material in their inability to secure financing.

The judge indicates that “Rescission is available in the case of an executory contract where a material misrepresentation that was an inducement to enter into the contract is established”: Panzer v. Seifman (1978)”

The Judge states, “Although one of the MLS listings failed to note that the lot was irregular, the PDR, available to the real estate agent for the defendants, indicated that the lot narrowed to the rear. The agreement accurately described both the frontage and the depth of the lot”. And the Buyers did attend the property during daylight hours.

Additionally, even if the buyer’s claim that he did not know the lot was narrower at the rear, the Judge states “there is no basis for suggesting that this was material see Barclays Bank PLC v. Devonshire Trust (Trustee of), 2011 ONSC 5008 (CanLII), at para. 157, affirmed 2013 ONCA 494 (CanLII)”. Additionally, there is no evidence in the record substantiating the Buyer’s claim that the appraised value was lower due to this factor.

The Judge also indicates that “ It is hard to imagine that the narrowing of the lot at the rear of this suburban home would impact the decision of a reasonable person to purchase the property. Further, the idea that the narrowing of the lot at the rear would meaningfully affect the value of this property seems highly improbable”.

Furthermore, the record, as per the Judge “makes plain that the defendants never sought to rescind the agreement before the scheduled closing because of any issue with the size of the lot. The lot size was not their concern; the price was. The defendants still wanted the property but at a reduced price. To the extent that they gave a reason for seeking a price reduction, they cited difficulties in securing financing. Tellingly, at no point did the lawyer representing the defendants reference the lot size as a factor contributing to the inability of his clients to secure financing”.


Court grants in Favor of the Sellers and the Buyers are ordered to pay $114,140.17, plus pre-judgment interest from February 1, 2018, at a rate of three percent per annum.

The listing brokerage is directed to release the $25,000 to the Sellers to be credited towards the judgement owing.


Ricky Rathore is a licensed Barrister & Solicitor – Rathore Baig Prof. Corp. and is a Broker/Owner of RE/MAX Empire Realty Brokerage.

Do not construe as direct or indirect legal advice or otherwise.

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