Greco v. Jarboh, 2025 ONSC 6391
The Superior Court’s decision in Greco v. Jarbohis a textbook example of what happens when a buyer claims not to have signed an Agreement of Purchase and Sale, but nonetheless takes steps consistent with completing the deal.
Justice Bordin granted summary judgment in favour of the seller, finding the purchaser liable for the failed real estate transaction. The Court relied heavily on the purchaser’s conduct, the absence of key evidence, and the commercial logic of real estate practice.
Background
- The property was located at 185 Golfwood Drive, Hamilton.
- The Agreement of Purchase and Sale (APS) was dated March 30, 2022 for $965,000, well above the $799,000 list price.
- The APS was unconditional, a financing condition had been struck out.
- The purchaser, Zainab Jarboh, paid a $50,000 deposit by bank draft the following day.
- Closing was set for June 30, 2022, but the purchaser was unable to obtain financing when the appraisal came in far lower.
- The seller later re-sold the home in November 2022 for $747,000, resulting in a $218,000 loss.
The defendant claimed she never signed the APS and believed there was a financing condition up to the closing date.
Ratification by Conduct
Even though the purchaser denied signing the APS, the judge found that:
- She knew about the APS on March 31, 2022, when she obtained the $50,000 bank draft.
- She retained a lawyer and mortgage broker and took steps to close.
- She had previously bought and sold multiple properties and therefore understood financing conditions and timelines.
- Her own supplementary affidavit contradicted her argument by acknowledging that the financing condition, had it existed, would have expired April 15, 2022.
The Court concluded that the purchaser ratified the APS through her actions.
Critical Evidence Missing
The judge drew an adverse inference because:
- The purchaser’s husband, who allegedly dealt directly with the real estate agent, did not file an affidavit.
- All evidence concerning discussions with the agent was hearsay.
- The defendant was expected, yet failed, to “put her best foot forward” on a summary judgment motion.
Without direct evidence from the husband, the Court rejected the claim that both believed a financing condition remained until closing.
Third-Party Claim Not a Barrier
The defendant sued her agent and brokerage for negligence and breach of fiduciary duty. She argued summary judgment should not be granted because those claims were still pending.
The court rejected this:
- The agent’s alleged wrongdoing concerned pre-APS advice and did not affect liability to the seller.
- The defendant had taken no meaningful steps in the third-party claim for over two years.
- There was no risk of inconsistent findings.
Decision
The court held:
- The purchaser knew about the APS,
- Knew or ought to have known it contained no financing condition, and
- Failed to close despite taking steps consistent with ratification of the contract.
Summary judgment was granted in favour of the seller for her losses on the failed transaction.
Considerations for Real Estate Professionals
- A buyer can be bound by an APS they did not personally sign if they later ratify it through their actions.
- Courts expect parties to produce direct evidence from key witnesses, failure to do so can be fatal.
- Financing conditions must be clearly understood, documented, and preserved.
- Third-party claims against agents do not delay a seller’s right to pursue contractual damages.
COMMENT
This deal appears to have been struck at the top of the market. That value dropped substantially by closing. A word of caution, it was listed at the right value. For some reason the buyer overbid, rather substantially.
If you are suing a real estate agent, you will need to file an Expert Witness Report and be prepared to call that witness.
Here, that simply didn’t happen. You might think that it was the lawyer’s fault, but there was no evidence this Buyer could offer that was truthful. In all likelihood, no Expert after consideration of the case was prepared to testify.
Brian Madigan LL.B., Broker
www.OntarioRealEstateSource.com