Seller’s Furnace Warranty Expiration

How to Register a Furnace Online? - Team Harding

Question:

How you all interpret “completion of transaction” in this clause:

“The parties agree that this representation and warranty shall survive and not merge on completion of this transaction, but apply only to the state of the property at completion of this transaction”

If you have a buyer and house closes and they move in, the furnace working when they got there until they go to bed. At about 11:55 pm that same day they notice house is getting cold and furnace isn’t working.

Who you think will be responsible for repair or replacement?

Answer:

The issue is to determine the condition of the furnace at the time of closing. This breakdown took place very, very soon, so, that’s a good thing for the Buyer on the facts.

A Court recently concluded that 3 weeks was too late. We have a suitable time frame.

Now, the question will be to determine the specific condition of this particular furnace on closing. No one was actually checking that fact on closing, there is no procedure in Ontario to sign off, so all of this, is guesswork to some degree. The more time that goes by after a closing, the more difficult it will be to prove.

The Seller would reasonably have to offer some evidence that some misfortune or accident were to have befallen the property. Maybe there was a storm or something else which caused damage to the property and damage to the furnace? With something being evident so soon, this is really the point of “time of first discovery”, it’s not the time it broke down. It was likely broken on closing.

Repairs would be all that would be in order. Replacement is unnecessary, unless, of course, it happened to be the least expensive alternative. That would be the Seller’s choice.

Brian Madigan LL.B., Broker

www.OntarioRealEstateSource.com

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