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Good evening.
Following are this week’s summaries of the civil decisions of the Court of Appeal for Ontario.
The court summarized the law on the doctrine of frustration in the context of the failure close the purchase of a residential property under an agreement of purchase and sale of land in Perkins v Sheikhtavi. The appellants bought at the height of the real estate market just before the government tightened the mortgage lending rules in April 2017, following which prices precipitously dropped 20-30%. They could not sell their home or get mortgage financing and therefore could not close. They claimed the government policy change was a supervening event that would make “performance of the contract become a ‘thing radically different from that which was undertaken by the contract’”. The court did not accept this argument. The defendant was found liable for almost $600,000 for the purchase price of a house they never purchased!! One cringes at the thought of what would happen if the market eventually turned into a prolonged and deep slump.Continue Reading COURT OF APPEAL SUMMARIES (NOVEMBER 25 – NOVEMBER 29, 2019)

