Purchasers of a residential property brought a Small Claims Court action alleging misrepresentation after discovering water seepage and moisture problems in the basement shortly after closing.
The vendors had provided oral assurances and a Property Condition Disclosure Statement indicating that no such issues existed.
The court held that the vendors were liable for negligent misrepresentation because a prior basement seepage issue had not been disclosed and the assurances reasonably induced the purchasers to complete the transaction despite concerns raised in a home inspection report.
Applying the principle that damages should fund corrective measures rather than betterment, the court limited recovery to the cost of repairing the weeping tile system and associated grading.
Judgment was awarded for the cost of these corrective measures.
