• Home /
  • Blog /
  • Negligence Battles Reaching Courtrooms: Overview of Case Law, Kwok v. Griffiths – Part 7

Negligence Battles Reaching Courtrooms: Overview of Case Law, Kwok v. Griffiths – Part 7

Posted on 17 Oct'14 Tags: , , , in Litigation and Dispute Resolution, Real Estate, Real Estate Blog Series

Continuing on with our Real Estate Blog Series on the Real Estate Agents’ Duty of Care: Legal Framework, part 7 focuses on case law with reference to negligence claims reaching the courtroom.

* Kwok v. Griffiths, [1996] B.C.J. No. 84. (British Columbia Supreme Court)

 

Facts and Decision:

This case in particular is focused on an action that addresses professional negligence. The plaintiffs, Kwok, wished to purchase land upon which to operate a car wash and contacted IPP Inc., the defendant, a real estate agency which introduced the Kwoks to a suitable property. An interim agreement of purchase and sale was entered by the Plaintiff`s which provided for a completion date of March 18, 1992.

After this the Plaintiffs asked the real estate agent to contact the vendor to extend the closing date from March 18th to the 25th, and to extend a subject removal clause to March 17th. The agent prepared the agreement containing granting both of the requested time extensions and obtained the purchaser’s signature on it.

When the vendors decided not to extend the completion date, the clause in the amending agreement was crossed out and the vendors signed the document. The plaintiffs retained the defendant notary public to act for them with respect to the conveyance. The notary received a copy of the proposed amending agreement containing the extended clause from the agent, with the purchaser’s signature but not the vendor’s. The agent did not send him a copy of the fully executed amending agreement.

Assuming that the transaction was to close on March 25th, the notary didn’t get himself, the plaintiffs or his staff ready to close on March 18th. On March 19 the vendor refused to close, relying instead on the “time is of the essence” clause of the agreement. The plaintiffs now sought damages against both the notary and the real estate agency.

The notary was held liable for failing to question the absence of the vendor’s signature on the alleged amending agreement. The real estate agent was also held liable but moreso; the Court said the agent fell below the standard of care expected of a prudent real estate agency in British Columbia by sending the proposed amending agreement to the notary public. Although the vendor rejected it, it was not the amending agreement that was eventually accepted and executed.

Where the parties to a real estate transaction had entered into an interim agreement and the real estate agent who brought them together had undertaken to send the relevant documentation to the purchaser’s conveyance, the agent failed his obligation to send all documents that referenced the agreement. Accordingly, the defendants were held jointly liable for the plaintiffs’ damages. It was neither unjust nor inequitable to allow the vendor to rely upon the time of the essence clause. This is another case that substantially reiterates a real agents responsibility, and the duty of care that must be exercised at all times.

Disclaimer: The above article is not a legal opinion as every case is different and is only for general awareness. Please contact us for specific questions and legal advise.