Vendors' failure to disclose second easement justified purchaser's refusal to complete transaction

Vendors entered into agreement of purchase and sale (APS) with purchaser who at time was aware of one easement, but later discovered second TransCanada Pipeline (TCP) easement in backyard under pool, cabana and patio. By virtue of easement, and agreement between vendors and TCP, TCP had right to remove pool and cabana if necessary. Easement and agreement were also subject of lawsuit between vendors and TCP, which vendors did not disclose to purchaser. Purchaser did not close and sought return of deposit, but vendors refused. Property was sold under power of sale six months later at loss. Vendors brought action for damages for purchaser's refusal to close and purchaser counterclaimed for return of deposit. Motion judge dismissed vendors' motion for summary judgment for damages and release of deposit. Vendors appealed. Appeal dismissed. Record amply supported motion judge's factual findings. Vendors' failure to disclose second easement and obligations arising therefrom, given requirement to convey title subject only to restrictions specifically listed in APS, justified purchaser's refusal to complete transaction. In any event, there was nothing in APS that required purchaser to sign agreement with TCP, which vendors had contracted to do, and this justified purchaser's refusal to complete transaction.

Savo v. Moursalien (2018), 2018 CarswellOnt 20404, 2018 ONCA 981, K. Feldman J.A., K. van Rensburg J.A., and I.V.B. Nordheimer J.A. (Ont. C.A.); affirmed (2016), 2016 CarswellOnt 7932, 2016 ONSC 3326, R.E. Charney J. (Ont. S.C.J.).