Minor Variation

This week I thought I would tackle an interesting issue that arose recently in my residential real estate practice.

Assume that you are purchasing a new home. Before deciding to enter into a purchase contract with the builder, you inspect the model home. You go into the basement of this model and discover that the ceiling is high enough for you to finish the basement as a recreation room. This would obviously necessitate some sort of finished ceiling, either a drop or dry-wall ceiling. Being satisfied with this aspect, you purchase the home.

A few weeks before closing you discover that the basement ceiling of your unfinished home is approximately 5 inches lower than that of the model home. You wonder what your remedies are.

To answer this question, one should start first by reading the purchase agreement. In your purchase agreement the following clause is cited on one of the schedules:

"The Purchaser acknowledges that the dimensions of the Property set out in this Agreement or on any Schedule attached thereto or shown on drawings or plans made available to the Purchaser on site or otherwise are approximate only. In the event the frontage, depth or area of the Property is varied from those specified in the Agreement or on any schedule attached hereto or shown on drawings or plans made available to the purchaser on site or otherwise, as aforesaid, or any or all of the foregoing and provided the Property complies with municipal and other governmental requirements including zoning by-laws, the Purchaser agrees to accept all such variations without claim for abatement in the Purchase Price and this Agreement shall be read with all amendments required thereby. In addition, if minor variations to the size of the dwelling including internal dimensions of any areas are made to the dwelling the Purchaser shall accept such minor variations without any abatement to the Purchase Price."

This clause says three important things. Firstly, dimensions on plans, drawings etc., are approximate. Secondly, as long as the finished product meets zoning and by-law requirements the Purchaser agrees to accept any variations from the plans, drawings etc., without abatement of purchase price. Finally, if "minor variations" to the size of the dwelling including internal size are made the Purchaser shall accept the variations.

In a 1983 Ontario Court of Appeal case, the Court was required to consider a similar situation. A basement ceiling turned out to be 3 inches lower than indicated on the plans. The Court found that 3 inches was not significant enough to treat the variation as something other than minor. At the same time the Court made a practical observation: whether the ceiling was 3 inches lower or higher, a tall person would not be able to move about without having to duck his head.

In your hypothetical case, absent a finding that the basement ceiling height fails to meet zoning by-laws, you will most likely be out of luck.

If you have a real estate query or wish me to act on your real estate transaction, please do not hesitate to contact me at 905-845-0767 x.223.