Question: Falsified Septic Evaluation
The Listing Agent provided a Septic Evaluation. This was accepted by the Buyer and the deal was closed. Now, there are significant problems. The signature and the date appear to be “forged”. The company itself denies providing these evaluations at all, at that time. What should be done?
This is an interesting situation. You should forward the Evaluation to the company, so that they can verify the response. If they claim that it’s a forgery, that would indeed constitute an offence under the Criminal Code. It would be covered under the offences related to fraud and false pretenses.
The Supreme Court of Canada has ruled that fraud is an exception to the caveat emptor doctrine. There is something of a catch 22 in this case. If the Listing Agent was duped too, then the only recourse is against the Sellers.
The homeowners’ insurance policy would cover false (but innocent) statements, however, it would not cover fraud. That would mean that the Buyer’s only recourse would be against the Sellers personally, and if there is no money, then, that would be a problem. In such circumstances, it could be wiser to step things down, and simply allege “negligence”, which is covered under the policy. If the matter were to proceed under the Criminal Code, there are no costs to the Buyer, other than time and the Judge would have the authority to direct that compensation be paid to the Buyer. Otherwise, the civil route would be at the expense of the Buyer.
Brian Madigan LL.B., Broker