What is the legal test for liability of a vendor in the sale of real property?

British Columbia, Canada


The following excerpt is from Hanslo v. Barry, 2011 BCSC 1624 (CanLII):

I will begin my analysis with a review of the law that has developed with regard to the vendor’s liability for defects in the sale of real property. The basic principle is that the doctrine of caveat emptor - buyer beware - applies unless there is something in the contract that protects the purchaser. As was stated in Fraser-Reid v. Droumtsekas, 1979 CanLII 55 (SCC), [1980] 1 S.C.R. 720 at 723: ... caveat emptor remains a force to be reckoned with by the credulous or indolent purchaser of housing property. Lacking express warranties, he may be in difficulty because there is no implied warranty of fitness for human habitation upon the purchase of a house already completed at the time of sale. The rationale stems from the laissez-faire attitudes of the eighteenth and nineteenth centuries and the notion that a purchaser must fend for himself, seeking protection by express warranty or by independent examination of the premises. If he fails to do either, he is without remedy either at law or in equity, in the absence of fraud or fundamental difference between that which was bargained for and that obtained.

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