Buyers sought rescission of an agreement of purchase and sale for a residential property and return of their deposit after discovering water in the basement on their third pre-closing visit.
Sellers sought a declaration of breach, damages, and forfeiture of the deposit.
The court found that the detrimental condition warranty clause in the agreement was limited to the sellers' knowledge and belief at the time of execution, not at closing.
Since the sellers had no knowledge of any water problem before signing the agreement, they did not breach the warranty.
The buyers breached by refusing to close.
The court awarded damages to the sellers totaling $206,703.56, representing the difference in sale price, rental costs, and other incidental expenses.
