The purchaser of a dry cleaning business sought to rescind the purchase agreement, claiming a common mistake regarding the property's zoning.
The motion judge granted rescission, finding the parties shared a mistaken assumption that the business was a 'permitted use' under the zoning by-law.
The Court of Appeal allowed the vendor's appeal, holding that the motion judge made a palpable and overriding error.
The Court found no evidence of a shared assumption about the technical 'permitted use' status, noting the business operated as a legal non-conforming use.
The Court also held that the purchaser bore the risk of zoning issues under the principle of caveat emptor, as the agreement contained no zoning conditions.