As anyone who has purchased or rented a property will tell you,
reviewing listings are an important way to find out information
about properties that are on the market. They contain important
information and details about a property and allow you to compare
between properties based on price, size, location, etc. A key part
of using MLS listings is being able to trust what they say. But
what happens when you’ve bought a property and discovered that
the listing you relied on contains a mistake?
That is exactly what happened to Salvatore Paglia in the spring
of 2012. After purchasing a vacant land that was listed by the
listing agent as a “fully serviced lot”, he discovered
that it was not electrically serviced. He brought an action against
the vendor, real estate agent, and broker and the court awarded him
the amount spent to electrically service the lot.
The listing agent was found liable for negligent
misrepresentation to the buyer. Pursuant to The REALTOR Code, the
listing agent owed a duty of care to prospective buyers to ensure
that advertising was accurate and to avoid misrepresentation. In
that case, the agent was not told that the lot was fully serviced
and did not take steps to ascertain what services were available.
The purchaser, who was not represented by an agent reasonably
relied on the claim that the lot was fully serviced and suffered
damages as a result.
In another case, Krawchuk v Scherbak, the agent who
acted for both the vendor and purchaser was found liable for
misrepresentation for failing to verify the accuracy of the
vendor’s representations or recommend independent inspection
before submitting an offer or making the offer conditional on
satisfactory inspection.
These cases serve as a reminder to realtors to verify facts and
to purchasers that they should, where possible, verify the
representations and perform an inspection themselves to avoid
problems after closing.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
