Caveat Emptor And Commercial Real Estate Considerations

The principle of caveat emptor, meaning "let the buyer beware," remains an important legal doctrine for real property transactions in Canada. The Ontario Superior Court of Justice recently considered this legal principle in CanDeal Group Inc. v. Capservco Limited and issued a ruling that, while not overhauling the law, underscores to all buyers and tenants of commercial real estate the importance of express representations and warranties and thorough physical and legal due diligence. The decision also provides a good summary for vendors and landlords as to what their disclosure obligations are and their liability (or lack thereof) for failing to disclose defects and issues with the subject property.