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Deposit

Posted on January 27, 2020 | Posted in Five Liners, Real Estate

Azzarello v. Shawqi 2019 Ont CA

Purchaser failed to close and vendor sued for damages and the deposit. The trial judge awarded the deposit in addition to the damages. The Court of Appeal held that when an agreement only calls for the deposit to be credited to the purchase price on completion, the measure of damages is based on the difference between the purchase price and the ultimate lower sale price; accordingly, the intent of the agreement is that the deposit is applied to the purchase price whether received on completion or as damages. The court gave credit for the deposit against the damages. Purchaser had also argued that vendor ought to have accepted his offer to purchase the property for a 10% reduction in the purchase price. The court held that the duty to mitigate does not oblige a vendor to accept an offer from a defaulting purchaser for less than the agreed price and then have to sue the purchaser for the difference from the original agreed price.

 

Jonathan Speigel

 

Written by Jonathan Speigel, the founding partner of Speigel Nichols Fox LLP, leads the litigation and construction practices.

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