Pagnuelo v. Choquette

Pagnuelo v. Choquette

The sale (as established by the final notarial deed) was vitiated by error and vendor's fraud in misrepresenting construction; rescission was therefore required. The purchaser alone had the option to rescind and recover the price and damages; where restitution in specie is impeded by the vendor's acts (vendor-built improvements on exchanged lots), the court may order repayment, value of improvements or other equitable adjustments. Accordingly the deed was rescinded and respondent ordered to repay purchase price with interest and damages subject to account.

Citation
(1903) 34 SCR 102
Parties
Appellant/plaintiff: Simeon Pagnuelo; Respondent/defendant: Hormidas Choquette
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
10 November 1903
Procedural Posture
Civil Appeal (contract/rescission) / On Appeal to the Supreme Court of Canada; Final Judgment
Outcome
Appeal allowed; judgment of courts below reversed in part; notarial sale (and related private writing insofar as necessary) rescinded.
Legal Topics
Rescission, Latent Defects, Fraud (dol), Warranty, Dation En Paiement, Action Quanti Minoris, Damages, Option of Purchaser
Source Language
English
Contract Law Property Law Civil Law (quebec) Sale/exchange of Immovables Rescission Latent Defects Fraud (dol) Warranty +4 more

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Parties

Simeon Pagnuelo

Appellant/plaintiff

Hormidas Choquette

Respondent/defendant

Procedural Posture

Civil Appeal (contract/rescission) / On Appeal to the Supreme Court of Canada; Final Judgment

Legal Issues

  1. 1 Whether the sale/exchange can be rescinded for error and latent defects absent common-law fraud
  2. 2 Whether purchaser must be confined to actio quanti minoris or may rescind and recover price
  3. 3 Whether an exchange (dation en paiement) is treated differently from a sale for rescission purposes

Ratio Decidendi

The sale (as established by the final notarial deed) was vitiated by error and vendor's fraud in misrepresenting construction; rescission was therefore required. The purchaser alone had the option to rescind and recover the price and damages; where restitution in specie is impeded by the vendor's acts (vendor-built improvements on exchanged lots), the court may order repayment, value of improvements or other equitable adjustments. Accordingly the deed was rescinded and respondent ordered to repay purchase price with interest and damages subject to account.

Court Disposition

Appeal allowed; judgment of courts below reversed in part; notarial sale (and related private writing insofar as necessary) rescinded.

Orders

  • Rescind and annul the notarial deed of 2 April 1898 and, insofar as necessary, the private agreement of 10 March 1898
  • Respondent to resume possession of his properties and reimburse appellant the purchase price and all sums paid by appellant with interest from date of each payment, with costs