Hamedani v. Leung and Madani, 2022 BCPC 138

Citation: Hamedani v. Leung and Madani 2022 BCPC 138 Date: 20220630 File No: C-2067331 Registry: Vancouver IN THE PROVINCIAL COURT OF BRITISH COLUMBIA BETWEEN: ROOZBEH MESRI HAMEDANI CLAIMANT AND: LAI KUEN LOUISA LEUNG and FERESH MADANI DEFENDANTS REASONS FOR JUDGMENT OF THE HONOURABLE JUDGE D. DOREY Appearing on his own behalf: R. Hamedani Appearing on her own behalf: L. Leung Counsel for the Defendant F. Madani: O. Hyatt Place of Hearing: Vancouver, B.C. Dates of Hearing: May 3, 4, and 5, 2022 Date of Judgment: June 30, 2022

Introduction: [ 1 ] A

summary of these reasons was delivered orally on June 30, 2022. The parties were advised that my written reasons would follow. These are my written reasons. [ 2 ] On September 9, 2019, Roozbeh Hamedani (the “Claimant”) purchased a one bedroom unit in the Westsea Towers (“Westsea”) in Vancouver, British Columbia from Lai Keung Leung (“Ms. Leung”). This was a leased property that Ms. Leung held under a long- term lease with the owner of the building, Westsea Construction Ltd. (the “Landlord”). [ 3 ] This was the second leased unit that the Claimant acquired in the Westsea. Ms.

Leung’s unit was next door to the Claimant’s unit in the building. [ 4 ] This dispute is about a construction overage expense of approximately $11,351 charged to the leaseholders by the Landlord on a 2018 building remediation project. [ 5 ] This overage expense was charged to each leaseholder in proportion to their unit entitlement pursuant to their respective lease agreements. The leaseholders were notified of this additional expense in mid-November 2019, approximately two months after the Claimant acquired Ms. Leung’s unit. [ 6 ] The Claimant commenced these proceedings against Ms.

Leung contending that she is responsible for paying this assessment because it formed part of the operating expenses of the building levied in connection with the 2018 remediation project. This Claim is loosely framed as a claim for unjust enrichment and for breach of contract and is denied by Ms. Leung. [ 7 ] It is undisputed that the contract of purchase and sale (which forms the basis of the dispute between the parties) had no holdback requirements or conditions for the seller to pay any additional costs associated with the remediation project, including the overage expense.

The Claimant asserts that he made the subject free offer on the advice of his realtor, Feresh Madani, because there were already two competing offers on the property and that he would have a better chance of having his offer accepted if it was made without conditions. [ 8 ] The Claimant also claims against Ms. Madani for negligence and breach of contract. He alleges that Ms. Madani breached her duty of care as a realtor because she failed to protect his interests as the buyer of the unit against further assessments in relation to the 2018 remediation project. Ms. Madani denies these allegations.

Issues: [ 9 ] As this is a civil claim, the Claimant bears the burden of proving his claims on a balance of probabilities. [ 10 ] The issues that are to be decided in this case are: (

a) Should the remediation project overage expense of $11,351.80 ought to be paid by Ms. Leung? (

b) Was Ms. Modani negligent in her representation of the Claimant in this transaction? Alternatively, did she breach her contractual duties to the Claimant in this transaction? Facts: [ 11 ] The facts I find on the evidence are as follows: (

i) The 2018 Remediation Project [ 12 ] All of the units in the Westsea are subject to long term leases with the Landlord. [ 13 ] The Landlord manages the Westsea and charges each leaseholder a monthly fee, similar to strata fees, for monthly operating expenses for the care and upkeep of the building. [ 14 ] The Westsea leaseholders are also responsible for paying the costs of major renovation projects, such as the 2018 remediation project discussed below, which are charged by Westsea as “operating expenses” under the lease.

Unlike a strata property, the Landlord unilaterally sets the monthly fees and determines the long term repair and maintenance projects to keep the building and common areas in good repair and condition. The leaseholders have little say in determining these costs and projects. [ 15 ] In January 2018, the leaseholders were notified by the Landlord of the planned remediation project. This was a major project that involved exterior walls, balconies, roof, and window replacement.

They were also notified in this same letter that they each would be charged the sum of $34,548.20 as an assessment for this project. [ 16 ] On April 20, 2018, the Landlord sent a further letter to the leaseholders in response to questions about the scope of the remediation project. In this letter, the Landlord re-confirmed that the “cost of the repairs” in connection with the remediation project were “operating expenses” under

Article 7 of the Lease. [ 17 ] In April 2018, the remediation project began. [ 18 ] At the time the Landlord notified the leaseholders of the remediation project, the Claimant and Ms. Leung were each leaseholders of their respective units. The Claimant’s unit was rented to his brother and Ms. Leung’s unit was rented out to a third party. [ 19 ] On May 14, 2019, the Landlord issued a progress report to the leaseholders which included a

schedule of operating costs. In this

letter, the Landlord advised: The special project – envelope repair costs of $2,462,307 from 2018 is for continuing envelope repair costs incurred in 2018. This project has a special assessment and collation terms. The balance will not be charged to the leaseholders until the project is completed and final costs determined. [ 20 ] The remediation project was still ongoing in July 2019 when Ms. Leung listed her unit for sale. (ii) The Accepted Offer and Contract of Purchase and Sale [ 21 ] The Claimant viewed Ms. Leung’s unit at an open house on July 21, 2019.

After viewing the unit, he decided to buy it as an investment property with the plan of renting it out. [ 22 ] The Claimant engaged Feresh Madani (“Ms. Madani”), a realtor with Georgia Pacific Realty and an acquaintance of the Claimant’s mother, to represent him as the buyer’s agent for this purchase. The Claimant’s mother approached Ms. Madani on behalf of the Claimant and told her that her son wanted to buy a second unit in the Westsea. Ms. Madani telephoned the Claimant to discuss the property and then arranged to meet with him. [ 23 ] Ms.

Madani met with the Claimant to discuss the offer in the early evening on July 22, 2019. She also prepared the buyer’s agency contract for the purpose of making the offer to purchase Ms. Leung’s unit. This was a three-month listing agreement that was backdated to May 22, 2019. The agency contract was then signed by the Claimant and witnessed by Ms. Madani. [ 24 ] It is undisputed that the term of the agency agreement was one day in order to facilitate the Claimant’s offer on Ms. Leung’s unit. This was explained by Ms. Madani and agreed to by the Claimant. [ 25 ] When the Claimant met with Ms.

Madani to discuss the offer, she informed him that there were already two competing offers on the property from other prospective buyers. She told the Claimant that if he wanted to improve his chances of acquiring the unit, then he would need to make a “clean”, i.e. , condition-free offer. [ 26 ] The Claimant received Ms. Leung’s clearance letter from the Landlord confirming that Ms. Leung’s maintenance and special assessment fees for her unit were “all up to date” as of July 22, 2019. Ms.

Leung’s selling agent provided this letter to the three interested buyer groups, including the Claimant. [ 27 ] On July 22, 2019, the Claimant made a written offer to purchase Ms. Leung’s lease for $355,000, which was $5,000 over the asking price, with a closing and possession date of September 9 and 10, 2019 respectively. [ 28 ] There was one subject condition written in the offer that Ms. Madani included for the Claimant’s benefit. This condition was “subject to” the Claimant’s review and approval of the lease. Ms.

Madani included this condition to the offer to afford some measure of protection for the Claimant in light of her concerns about presenting a subject-free offer. [ 29 ] This condition was rejected by Ms. Leung in a counter-offer made at 8:30 p.m. that evening which was open for acceptance until 11:00 p.m. The Claimant accepted the counter-offer. The parties thus had a binding agreement. [ 30 ] Following acceptance of his offer and at the Claimant’s request, Ms. Madani arranged a second viewing of the unit for the Claimant and his mother the next day. During this showing, the Claimant asked Ms.

Leung’s selling agent to confirm whether Ms. Leung had paid all outstanding balances for building repairs and maintenance, which he confirmed that she had and that there were no outstanding balances owing to the Landlord. [ 31 ] That same day (July 23, 2019), the Claimant received Ms. Leung’s property disclosure statement for her unit. He also paid the deposit on the unit as required. [ 32 ] Under the terms of Ms. Leung’s lease, Westsea must approve the assignment of her lease to the new buyer before the transfer of the unit can occur. Westsea approved the assignment of Ms.

Leung’s lease to the Claimant so the sale could complete. The sale of Ms. Leung’s unit then completed on September 9, 2019. (iii) Post-Closing Assessment [ 33 ] On November 22, 2019, the Landlord notified the leaseholders by letter that the remediation project had been “completed”. In this letter, the Landlord also advised the leaseholders that there would be a further charge of $11,351.80 assessed against each unit under

Article 7.01 of the Lease for cost overruns attributed to engineering-related expenses and GST in relation to the 2018 remediation project. This assessment was due and payable on January 1, 2020. [ 34 ] The Claimant now faced two further sets of assessments for his two units. [ 35 ] The Claimant felt that Ms. Leung should pay for the assessment for her former unit since this was a charge related to remediation project. He instructed Ms. Madani to assist him in seeking payment of this assessment from Ms. Leung. [ 36 ] On December 20, 2019, Ms. Madani sent an email to Ms. Leung’s selling agent requesting that Ms.

Leung pay the Landlord directly for the project overages owing on her former unit as per the Landlord’s November 22, 2019 letter to all tenants. [ 37 ] In response to the Claimant’s demand, Ms. Leung instructed her selling agent to inform the Claimant that she “was not aware, nor given notice of, anything that would be owing afterwards or for a cost overage” prior to completion of the sale. Accordingly, she took the position that the cost overage was the Claimant’s responsibility and refused to pay the assessment. [ 38 ] On March 5, 2021, the Claimant commenced his Notice of Claim against the Defendants.

(iv) Remediation Project Expenses [ 39 ] The total contract cost for the remediation project was expected to be $5,286,641. The project was subject to cost increases that were not known or anticipated by the Landlord at the time the project expense notice was issued to the leaseholders in January 2018. As set out above, the Landlord notified the leaseholders in May and in November 2019 of the project cost overruns. [ 40 ] On July 2, 2021, the Landlord’s auditors completed their audit of the

Schedule of Operating Costs for Westsea for the year ended December 31, 2020, and released its report to the Landlord. The Landlord, in turn, circulated the auditor’s report to all leaseholders, including the Claimant. The audit report indicated that the remediation work was “finalized” as of December 31, 2020. [ 41 ] The final project costs were tallied at $7,000,049. This figure represents an increase of almost $2 million dollars over the initial expected costs. [ 42 ] The leaseholders were collectively “expensed” the following sums for this remediation project: $6,365,473 in 2018, $637,255 in 2019, and $45,811 in 2020.

Summary of the Evidence: (

i) The Claimant’s Witnesses [ 43 ] The Claimant testified that he and his mother met with Ms. Madani at his apartment on July 22, the day after he went to the open house. He lived across the street from the Westsea. [ 44 ] The Claimant testified that the three of them sat at his kitchen table where they discussed the unit. He told Ms. Madani he owned a unit in the Westsea which he rented to his brother, that he paid a significant sum for the remediation project, and that he wanted Ms.

Madani to ensure that “there would be nothing remaining that he would be charged” for the project after purchase. [ 45 ] Following this meeting, the Claimant signed a buyer’s agency contract for Ms. Madani to represent him in this transaction. [ 46 ] The Claimant testified that Ms. Madani recommended that he make a “no subject offer” as “we would have a better chance to buy it” because there were two other offers on the unit. [ 47 ] The Claimant agreed in cross-examination that Ms.

Madani told him her concerns about financing when discussing the implications of making a “subject free” offer, which meant that he could not back out of the sale if they could not arrange financing. The Claimant stated he told Ms. Madani during their meeting that he was not worried about obtaining financing, that he had a tenant for the unit, and instructed her to make the offer. [ 48 ] The Claimant testified that Ms. Madani went through the offer in a perfunctory way and she had him sign his initials in various places and then sign the offer. In answer to questions in cross-examination by counsel for Ms.

Madani, the Claimant admitted that he looked over every “spot” in the offer that he initialled, that he understood this was an important document, and that he conceded that he should have paid more attention to the document at the time of signing. [ 49 ] Later that evening, Ms. Madani came back to meet him in the lobby of his building to have him initial Ms.

Leung’s counter-offer. [ 50 ] During cross-examination, the Claimant testified that he knew that a large portion of the remediation project for the building had completed as the scaffolding had been removed at the time he made the offer; however, he stated he was unaware whether the Landlord would be charging further assessments to the leaseholders in relation to the project expenses. This is the reason why he asked Ms. Madani to investigate the expenses and report back so that he was “protected” from that risk. He further testified that “had he known” the project was ongoing, he “would have instructed Ms.

Madani” to include a holdback term in his offer. [ 51 ] He testified that Ms. Madani assured the Claimant and his mother that she would “look into” his request to ascertain if all assessments had been paid on Ms. Leung’s unit. He was emphatic that he provided those instructions to Ms. Madani when they met at his kitchen table at his apartment. [ 52 ] The Claimant admitted in cross-examination that there was no holdback term included in his contract to purchase Ms. Leung’s unit even though he had a holdback provision in his purchase agreement for his other unit in the Westsea.

When further queried, he responded by stating that he assumed that Ms. Madani would protect him as a buyer by including this term in the contract based on her “professional abilities and knowledge”. [ 53 ] In response to questions by Ms. Leung, the Claimant admitted he never saw the Landlord’s May 14, 2019 progress report and was unaware of the cost overruns stating that his brother never gave him the report. [ 54 ] He further stated he only became aware of the “cost overages” when he received the Landlord’s November 22, 2019 letter to the leaseholders.

The Claimant, however, conceded that his brother told him that the amount he paid for the “initial special levy” in April 2018 “might be increasing.” He did not state when his brother informed him of the cost overruns but stated that he had not received any “indication” from the Landlord that there were sums owing at the time of closing. [ 55 ] The Claimant’s mother, Ozra Ebrahami, confirmed in her testimony that she recommended Ms. Madani to be their realtor. She stated that she was present at a meeting with Ms. Madani and the Claimant at his apartment to discuss the purchase of Ms.

Leung’s unit. [ 56 ] She confirmed there were two meetings with Ms. Madani, the first meeting took place at the Claimant’s apartment where the buyer’s agency contract was signed and the second meeting was a brief meeting inside the lobby of her son’s building during the evening when he signed the offer. [ 57 ] Ms. Ebrahami testified that at the first meeting she and her son asked Ms. Madani to make inquiries of the Landlord to determine

if there were any more “renovation” costs to come. Ms. Ebrahami testified that Ms. Madani agreed to make those inquiries and later confirmed the next day during a follow-up viewing of Ms. Leung’s unit that there were “no other costs owing” and that everything had been paid up on the unit. [ 58 ] During cross-examination, Ms. Ebrahami agreed that Ms. Madani told them that they could not obtain mortgage financing on a leasehold property. She understood from their meeting with Ms. Madani that there were other pending offers on Ms.

Leung’s unit, they were more likely to become the successful bidder if they offered a higher sum over the listing price, and finally, that they not include any “subject” conditions in the offer because vendors “don’t like that”. Notably, it is Ms. Madani’s evidence that she discussed the points with Ms. Ebrahami during their telephone call. (ii) Ms. Leung [ 59 ] Ms. Leung testified that she and her late husband bought their unit in the Westsea in February 2016 as an investment. After her husband died, Ms.

Leung decided that she no longer wanted the added responsibility of managing the unit and thus decided to sell her unit once her tenant gave notice of her intention to move out. [ 60 ] She testified that she paid the special levy in April 2018 over 12 instalment payments which was fully paid up before she listed her unit for sale. [ 61 ] Ms. Leung further testified that apart from the May 19, 2019 report from the Landlord, she never received any further communications or correspondence from the Landlord that there were any unpaid costs owing on her unit. [ 62 ] On the advice of her realtor, Ms.

Leung sought and obtained a clearance letter from the Landlord on July 22, 2019. This letter was provided to the three buyers’ groups who made offers to purchase her unit. This letter confirmed that Ms. Leung had paid up all outstanding expenses on her unit as of that date. She testified that there were no other amounts owing to the Landlord for her unit as of the closing date. (iii) Feresh Madani [ 63 ] Ms. Madani has been a licenced realtor in British Columbia since 2004. She was contacted by Ms.

Ebrahami, by telephone late Sunday afternoon on July 21, 2019, to discuss her and her son’s, interest in purchasing Ms. Leung’s unit in the Westsea. During the telephone call, Ms. Ebrahami told Ms. Madani that her son viewed the unit at an open house in the afternoon and they wanted to buy it. [ 64 ] Ms. Madani was worried about Ms. Ebrahami and her son making an offer to purchase as she knew that Ms. Ebrahami was on income assistance and that the Claimant only worked part-time. She expressed these concerns to Ms.

Ebrahami during their telephone call and told her that because the building is a leased property, it is “hard” to obtain financing. She gave Ms. Ebrahami the names of two mortgage brokers that she knew to assist them in arranging financing. [ 65 ] Although neither the Claimant nor Ms. Ebrahami recalled being provided with the names of two mortgage brokers, both witnesses agreed during cross-examination that Ms. Madani discussed her concerns with each of them about financing. [ 66 ] On Monday morning, July 22, Ms. Madani texted Ms. Leung’s realtor to arrange a further viewing of the unit. She was advised by Ms.

Leung’s realtor in response to her message that the unit had two offers. [ 67 ] She telephoned Ms. Ebrahami to report back on the multi-offers on the unit and informed Ms. Ebrahami that if they wanted to buy the unit, that it would have to be a subject-free offer. She also asked to speak to the Claimant and was told he was not home. [ 68 ] Ms. Madani prepared the offer based on the information provided to her by Ms. Ebrahami. She later telephoned the Claimant to confirm that he would make the offer and then arranged to meet with him to review the offer and the buyer agency agreement.

She met the Claimant outside his building at around 5:00 p.m. as she was pressed for time and wanted to get back to her office to send out the offer. She testified that Ms. Ebrahami was not present at this meeting. [ 69 ] She then reviewed the buyer’s agency contract and the offer with the Claimant. She testified that she “explained everything” and he signed the documents. [ 70 ] There was no discussion about future repair costs during this meeting according to Ms. Madani’s testimony. She was tested on this aspect of her testimony during the Claimant’s cross-examination. Ms.

Madani maintained that the Claimant did not inform her of his concerns about construction cost overruns nor did he ask her to investigate them. [ 71 ] She reiterated during cross-examination that she told the Claimant that there were multiple offers on the unit and that if he wanted to improve his chances of buying it, then he would have to make a subject-free offer. [ 72 ] At 6:28 p.m. on July 22, 2019, Ms. Madani emailed the Claimant’s offer to Ms. Leung’s realtor. [ 73 ] At 8:30 p.m. that same evening, Ms. Madani received a counteroffer from Ms. Leung which was open for acceptance until 11:00 p.m.

In her counteroffer, Ms. Leung crossed out and rejected the lease approval condition that Ms. Madani had included in the Claimant’s offer and she added a clause requiring the Landlord’s consent to the assignment of Ms. Leung’s lease as a condition precedent to completion of the sale. [ 74 ] In his email to Ms. Madani, Ms. Leung’s realtor wrote: … The other offer was very close but could not remove their financing clause. Being subject-free got you the home so good job! [ 75 ] Ms. Madani met with the Claimant outside his building to discuss the counter-offer, which he accepted. The meeting was brief. Ms.

Madani had the Claimant sign the counter-offer and initial the changes. She emailed the accepted counter-offer that evening to Ms.

Leung’s realtor before the deadline. Discussion: (

i) Issue 1: Should Ms. Leung Pay the Project Overage Assessment? [ 76 ] Under

Article 7 of the Lease, operating expenses are defined to include, “the amount paid or payable by [Landlord] in connection with the maintenance, operation, and repair of the Building … the common property, and the lands …”

Article 7 further provides that the Landlord agrees to exercise “prudence and reasonable discretion in the incurring of expenses”. [ 77 ] In its April 20, 2018 letter to the leaseholders, the Landlord took the position that the costs associated with the 2018 remediation project were “operating expenses” within the meaning of this provision because these costs pertained to the “maintenance, operation, and repair” of the building. Under the terms of the Lease, a leaseholder who fails to pay their share of the operating expenses will be in default of their obligations under the Lease. [ 78 ] The Claimant relies on

Article 7 to support his contention that Ms. Leung is obligated to pay the cost overage assessment of $11,351.80 since this expense was incurred during the period she owned the unit. He submits that it is an “operating expense” under the Lease, and that it forms part of the buyer’s and seller’s statement of adjustments. [ 79 ] Specifically, the Claimant relies on Note 4 to the Statements of Adjustments which reads: 4. Any items not specifically adjusted in this statement will be adjusted and settled directly between the parties. [ 80 ] Ms.

Leung submits that it is the Claimant’s responsibility to pay the cost overage expense since it was charged by the Landlord after he took possession of her unit and because the Claimant made an unconditional offer to purchase her unit, which she accepted. [ 81 ] It is undisputed that the Claimant owned another unit in the Westsea at the time he made his offer to buy Ms. Leung’s unit. He knew there was an ongoing remediation project that had not been completed when he made his offer. This was obvious from his testimony. As a leaseholder in the Westsea, the Claimant knew this was a major project.

He also knew or ought to have known from the Landlord’s May 14, 2019 report to all leaseholders that there were unexpected cost increases in the remediation project that would not be charged until the project was completed. At the very least he knew from his brother that the amount he paid for the initial special levy in 2018 “might be increasing”. [ 82 ] As there was no holdback or requirement in the contract of purchase and sale to pay further assessments in relation to the 2018 remediation project, Ms. Leung was not legally obligated to pay the $11,351.80 assessment.

Since this was an unascertained expense at the time of closing, I find that it is not an “item” that forms part of the statement of adjustments. [ 83 ] Accordingly, I dismiss the Claimant’s claim against Ms. Leung. (ii) Issue 2: Was Ms. Madani Negligent in her Representation of the Claimant? [ 84 ] The Claimant owned another unit in the Westsea at the material time he made his offer to purchase Ms. Leung’s unit. Thus, he was familiar with the building and its management because he was a leaseholder. He inspected Ms. Leung’s unit at an open house, decided he wanted to buy it, and engaged Ms.

Madani for the sole purpose of making an offer to purchase this unit. [ 85 ] On July 22, 2019, the Claimant entered into an agency agreement with Ms. Madani and her real estate firm. The term of this agreement was for one-day in order to facilitate the Claimant’s offer to purchase Ms. Leung’s unit. [ 86 ] The Claimant claims against Ms. Madani for negligence and breach of contract. He alleges that Ms. Madani breached her duty of care as a realtor because she failed to protect his interests as the buyer against further assessments in relation to the 2018 remediation project. He submits that Ms.

Madani failed to meet her professional standards and was negligent by not doing the due diligence on the building he instructed her to perform on July 22 when they met in person, that she misrepresented the fact that the that Ms.

Leung’s unit was free and clear of further expenses on the remediation project when it was not, and by not including a holdback provision in the offer that would have protected him from the cost overage charge on the project. [ 87 ] Although the Claimant did not lead expert evidence regarding the standards of care expected of realtors in advising buyers with respect to a residential property involving multiple offers, he relies on the Canadian Real Estate Association’s Realtor Code of Professional Conduct (the “ Code” ) and the British Columbia Financial Services Act’s Real Estate Services Rules (the “ Rules” ). [ 88 ]

Article 3 of the Code describes the realtor’s primary duty to the client as follows: A Realtor shall protect and promote the interests of his or her Client. This primary obligation does not relieve the Realtor of the responsibility of dealing fairly with all parties to the transaction. [ 89 ]

Article 4 of the Code provides: A Realtor has an obligation to discover facts pertaining to a property which a prudent realtor would discover in order to avoid error or misrepresentation. [ 90 ] Rule 34 of the Rules set out the realtor’s duty to act with reasonable care and skill when providing real estate services. [ 91 ] It is clear on a plain reading that a realtor’s performance of these duties are subject to a standard of reasonableness. [ 92 ] To prove a claim for negligent misrepresentation, the following five elements must be present:

1. There must be a duty of care based on a “special relationship” between the representor and the representee; 2. The representation in question must be untrue, inaccurate, or misleading; 3. The representor must have acted negligently in making the misrepresentation; 4. The representee must have relied, in a reasonable manner, on the negligent misrepresentation; and 5. The reliance must have been detrimental to the representee in the sense that damage resulted. Queen v.

Cognos, (SCC), [1993] 1 SCR 87, at para. 33. [93] For the duty of care to exist, the person making the statement must possess special skill or knowledge on the matter in questionand that a reasonable person making that statement would know that the recipient is relying on their skill or judgment. There was nosuggestion in this case that Ms. Madani lacked the special skill or expertise as a realtor in advising buyers on the purchase of a residentialproperty. [94] The real issues in this case are whether there were “misrepresentations” made by Ms.

Madani in advising the Claimant on therisks of this property and in relation to the operating expenses owing or potentially owing on the unit that the Claimant reasonably reliedon to his detriment. [95] Counsel for the Defendant submits there is no duty of care owed by a realtor to a client to warn of a client of obvious risks citingBrown v. Douglas, 2010 BCSC 1059, as authority for that proposition. At para. 43, the Court in that case states: There is no duty of care to warn a client of obvious risks. For example, in Longshaw v.

Houghton, [1993] 29 R.P.R. (2d) 190 (S.C.), thisCourt held that there was no duty to warn a purchaser of the risk that his own property might not sell quickly. Koenigsberg J. noted: “theappropriate standard of care must be judged in the light of the particular circumstances of each case” but accepted that the appropriatestandard to be applied had been set out in Shulist v. Hunt (1987), 78 A.R.188, (AB QB), 51 Alta L.R. (2d) 69 (Q.B.)at para. 41: In my view, in determining liability, if any, of the appellants, the key questions to be answered are these:

(1) Were the appellants possessed of a special skill?

(2) Did they, irrespective of contract, undertake to apply that skill for the assistance of the respondents?

(3) Did the respondents rely upon such skill?

(4) Did the appellants negligently fail to apply such skill?

(5) Did the [respondents] suffer damage as a result of such failure? … [96] I agree with this submission. [97] The events leading up to the making of the offer unfolded quickly. It was clear from the evidence that the Claimant knew thiswas a property that generated considerable interest following the open house he attended the previous day. [98] In preparation for her meeting with the Claimant, Ms. Madani made inquiries of Ms. Leung’s agent and determined that allexpenses owing to the Landlord had been paid-up on the unit as of the date of the offer.

That was confirmed by the clearance letter thatwas provided to Ms. Madani and the Claimant by Ms. Leung through her selling agent, and was re-confirmed by the selling agent onJuly 23 during the second showing of the unit. [99] Ms. Madani testified that she met with the Claimant outside his apartment building on July 22 and that he was alone. She wasemphatic in her testimony that no meeting took place inside the Claimant’s apartment and that Ms. Ebrahami was not present when theClaimant signed the documents. [100] Ms.

Madani also testified that she was pressed for time when they met as she needed to submit the offer to the selling agentknowing that there were two competing offers on the property. This is why she arranged to meet the Claimant outside his apartmentbuilding. [101] After meeting with the Claimant, Ms. Madani returned to her office and emailed the Claimant’s offer to Ms. Leung’s realtor at6:28 p.m. [102] Given this sequence of events, I accept Ms.

Madani’s evidence and find that she did not meet with the Claimant and his mother inhis kitchen when they met to review and sign the buyer’s agency agreement and the offer given these time constraints and that theClaimant was alone when she met with him. [103] The Claimant contends that he instructed Ms. Madani to make due diligence inquiries of the Landlord before his offer wasaccepted by Ms. Leung, which she agreed to make. Ms. Madani contends that she did not receive those instructions from the Claimant. [104] Ms.

Madani testified that had she received those instructions from the Claimant, it was unlikely she would have been able tocomply with them given the time constraints. I accept Ms. Madani’s evidence that it was unlikely that the Landlord would disclose thatinformation to a buyer’s agent for the simple reason that she was not the leaseholder. I find that the Claimant was in a better position tomake those inquiries of the Landlord directly and that it was unrealistic for him to expect Ms. Madani to be able to do so given the timeconstraints for presenting the Claimant’s offer.

[105] The Claimant knew he was making a subject-free offer and understood the implications of making an unconditional offer fromwhat Ms. Madani told him but still believed that Ms. Madani would draft the offer in such a way as to protect his interests. [106] Ms. Madani did, in fact, try to protect the Claimant’s interests by including the “lease approval” condition in the offer as she wasworried about financing and wanted to give the Claimant an opportunity to walk away from the deal. This condition was, however,rejected by Ms.

Leung in her counteroffer. [107] Although the Claimant maintains that he did not receive the Landlord’s May 14, 2019 progress report, his brother (and tenant)told him that the “initial special levy” he paid in 2018 “might be increasing”. Thus, he was aware or at least alerted to the fact that therewould be further costs associated with the remediation project that had not yet been charged to the leaseholders. He was clearly aware ofthis fact at the time he made his offer to buy Ms. Leung’s unit. [108] The British Columbia Court of Appeal in Nixon v.

MacIver, 2016 BCCA 8, confirmed that the doctrine of caveat emptor or the“buyer beware” principle also applies to the sale of real property. A purchaser thus has some responsibility to protect their own interestsand “cannot simply put their trust totally in a real estate agent”: deBoer v. Neuman et al, 2014 BCPC 174 , 2014 BCPC 0174, atpara. 37. [109] The Claimant admitted in cross-examination that he included a holdback condition on the other unit he purchased in the Westseabut did not include a similar condition in his offer on Ms. Leung’s unit.

However, in answer to questions in cross-examination, theClaimant testified that he assumed that Ms. Madani would have included a holdback in his offer “based on her professional abilities andknowledge”. It was not reasonable for the Claimant in these circumstances to assume Ms. Madani would include the holdback conditionin this offer. [110] As a leaseholder, the Claimant could have made due diligence inquiries of the Landlord for an update on the project expenses, orat the very least, he could have requested copies of the Landlord’s reports to the tenants on the project prior to meeting with Ms.

Madanion July 22. He did not do so. [111] Armed with the knowledge that the project expenses “might be increasing”, the Claimant could have raised with Ms. Madani thequestion of whether he ought to include a holdback provision in his offer, but did not do so. [112] I find that the reason the Claimant did not discuss or request the inclusion of a holdback condition is because he knew from Ms.Madani there were already two competing offers on Ms. Leung’s unit. He really wanted to buy this unit as an investment, and he knew hehad a better chance of acquiring the unit if he made an offer without conditions.

He thus took the risk by making a subject-free offer. [113] In sum, I find that the risk of further expenses on the 2018 remediation project was an obvious risk that the Claimant took intoaccount when he made his offer to purchase Ms. Leung’s unit. He did so knowing the risks of making an unconditional offer. Ms.Madani did not owe the Claimant a duty of care to explain these risks. [114] I further find that Ms. Madani met her professional duties owing to Mr.

Madani as a buyer in explaining the risks of making anunconditional offer that he accepted. [115] Accordingly, the Claimant has not proven his claims in contract and in negligence against Ms. Madani and these claims aredismissed. Conclusion: [116] The Claim is dismissed against the Defendants. The Defendants are entitled to claim reimbursement of their filing fees andreasonable disbursements, which must be submitted to the Claimant within 30 days from today’s date. _____________________________ The Honourable Judge D.L. Dorey Provincial Court of British Columbia