Is a purchaser entitled to claim back the deposit on a contract where the vendor has not had a good title?

Ontario, Canada


The following excerpt is from Armstrong v. Nason, 1894 CanLII 22 (ON CA):

I do not think that the decision in Want v. Stallibrass, L.R. 8 Exch. 175, at all conflicts with this view. It proceeded apparently upon the ground that within the meaning of the conditions as properly construed there had been no default on the part of the purchaser. There was no stipulation on which the vendor could rely giving him a right to retain the deposit, and the contract went off without any default of the purchaser, but of the vendor who had not a good title, and therefore the purchaser was entitled to claim back the deposit.

Some expressions of Mr. Justice North in the case of Nash v. Wooderson, 33 W.R. 301, 52 L.T.N.S. 49, have been relied on, but I do not see how the case itself or the dicta in it, can affect the question we are considering, the construction and effect of a special contract. That is the case of a contract completed by conveyance, which could only be set aside, as I read the cases, on the ground of actual fraud, and as I understand the decision the learned Judge found actual fraud on the part of the vendor by making a representation which he knew to be untrue, and the contract contained a stipulation framed apparently with the view of concealing the facts and preventing any investigation into them.

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