Addition of uppermost floor is a material change under Condominium Act, ruling acknowledges
The Ontario Superior Court of Justice has declined to rescind an agreement of purchase and sale upon finding that the purchasers had no right to rescission under Ontario’s Condominium Act, 1998 or at common law.
The parties in this case executed the March 2022 agreement wherein the applicants agreed to purchase a residential unit in the respondent’s condominium development along Kalar Road, Niagara Falls, Ontario. This unit was on the third floor, which was the highest floor according to the development’s plans at that time.
A revised disclosure statement emailed to the applicants in February 2024 revealed that the plans had changed such that the condominium development would now feature a fourth floor.
The parties and their lawyers then exchanged emails containing clarifications and negotiations relating to this issue. In an email dated last June 3, counsel for the applicants stated that he would recommend rescission of the agreement if the respondent failed to respond within two days.
Last June 12, the applicants brought this application before the Superior Court. They requested the return of their deposit with interest. They claimed that adding the fourth floor amounted to a material change entitling them to rescission under the Condominium Act’s provisions.
In Trivedi v. 2607305 Ontario Inc., 2025 ONSC 72, the Superior Court of Justice of Ontario refused the rescission requested by the applicants.
First, the court accepted that the addition of the fourth floor was a material change in this case since the original location of the applicants’ unit on the top floor was an objectively important characteristic. The court found it likely that the applicants would not have pushed through if they had known about the change in plans at the time of the purchase.
The court noted that a condominium development’s top level could be called the penthouse floor and could be considered to offer more peace and privacy, less trouble from neighbouring units, and better status within the building’s residents.
However, the court ruled that the applicants lost their right of rescission under the Condominium Act due to their failure to comply with the time limits set under s.74(5) or s.74(6).
The court noted that the applicants received the revised disclosure statement with the information about the material change last February 22, obtained the right to rescind at that point, and had a 10-day window to exercise or preserve that right, possibly by filing an application with the Superior Court.
But the applicants only attempted to exercise or preserve their right of rescission last June 12 by bringing the present application, which fell beyond the statutory 10-day window, the court found.
Lastly, the court decided that the applicants also had no entitlement to terminate the agreement at common law, given that the respondent did not fundamentally breach the agreement.
