While looking for a home, you fall for a century-old residence: what should you do? Make sure you carry out certain verifications before closing the sale. Although the legal warranty of quality applies regardless of the building’s age, courts generally have more stringent expectations towards buyers of older properties. The Superior Court illustrated this in the recent case of Auchintek c. Gerkes, 2022 QCCS 2637.
In that case, the plaintiff was asking for more than $430,000 in damages from the seller for latent defects in a property that she had bought in 2004. The defendant raised two key arguments for his defence: the buyer’s negligence in having failed to perform an inspection on a dwelling built in 1910, and failure to give notice within a reasonable time. The quantum of the damages was also in issue.
Reminder of the Criteria for the Warranty of Quality
The Court first reminded us that a seller must guarantee to the buyer that the property and its accessories are free from latent defects rendering it unfit for the use for which it was intended. To succeed in his recourse, a buyer must prove that the alleged defect:
- Was not obvious to a prudent and diligent buyer;
- Is serious;
- Existed at the time of the sale; and
- Was unknown to the buyer (which is presumed).
The Court continued by reminding us that the legal warranty does not cover normal wear and tear.
A prudent and diligent buyer of an old dwelling should perform a thorough examination, and expect certain repairs due to the property’s age. Such buyer is presumed to accept the normal wear and tear and the fact that construction standards were not as stringent as they are by today’s standards.
Application to the Facts
Considering the evidence, the Court concluded that the alleged damages were not the result of latent defects, but were caused by normal wear and tear. It agreed with the defendant’s expert, who based his conclusion on the Manuel de l’évaluation foncière du Québec, in virtue of which the life expectancy of a building’s foundations and structure is 100 years. As the dwelling had been built in 1910, the structural elements had reached the end of their useful life.
The Court also mentioned that even if it had come to the conclusion that the dwelling did have defects, those could not be considered to be latent since the plaintiff had not acted like a prudent and diligent buyer. Given the age of the building, she should have asked for a pre-purchase inspection. The plaintiff alleged that she had witnessed extensive repairs performed by the seller, who had been her companion from 2002 to 2004, and that she was confident that, had problems existed, those would have been fixed as part of those repairs. The Court did not agree with this argument.
Although retaining an inspector is not generally necessary in order to be considered as a prudent and diligent buyer, certain circumstances may dictate otherwise, for instance when clues are present or when the seller raises previous problems. In the Court’s opinion, the mere fact that a dwelling is 100 years old dictates the need for an inspection. In this case, an inspection could have alerted the plaintiff on the need to proceed to more thorough verifications.
Absence of Notice Within a Reasonable Time
Even if the Court had concluded that there were latent defects, the plaintiff’s claim would have been dismissed since she had omitted to give the defendant a notice within a reasonable time, as required by article 1739 of the Civil Code of Québec.
The plaintiff’s lawyer had sent the defendant a notice by regular mail in 2017, but the Court believed the defendant’s version that he had never received it. Only when the lawsuit was launched and the defendant received the summons, at another address, did he learn of the plaintiff’s claim. At that time, the repairs had already been completed, thus depriving him of his right to examine the defects and correct them.
To avoid such a conclusion, buyers (and their lawyers and insurers, as the case may be) should always give notice in due time of the defect, using means that will allow them to prove receipt by the seller.