Hayward and Govier v. Mellick and Mellick, (1984) 2 O.A.C. 161 (CA)

• Judge: Houlden, Weatherston and Goodman, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: February 06, 1984
• Jurisdiction: Ontario
• Citations: (1984), 2 O.A.C. 161 (CA)

Hayward v. Mellick (1984), 2 O.A.C. 161 (CA)

MLB headnote and full text

Hayward and Govier v. Mellick and Mellick

Indexed As: Hayward and Govier v. Mellick and Mellick

Ontario Court of Appeal

Houlden, Weatherston and Goodman, JJ.A.

February 6, 1984.

Summary:

The plaintiffs purchased a farm from the defendants upon the oral representation by the defendant's agent and one of the defendants that the farm contained 65 workable acres i.e. under cultivation. The signed agreement for sale did not refer to workable acres but described the farm as 94 acres. The agreement also provided that "there is no representation, warranty, collateral agreement or condition" other than expressed in the agreement. After completion the plaintiffs discovered that there were only 51.7 workable acres. They brought an action for damages. The defendants relied upon the disclaimer clause.

The Ontario High Court allowed the action and awarded the plaintiffs damages, finding that the disclaimer clause was inapplicable. The defendants appealed.

The Ontario Court of Appeal allowed the appeal and dismissed the action. The court, Houlden, J.A., dissenting, held that, although the defendants' statement regarding workable acres was a negligent representation, which would normally ground an action for damages, the disclaimer clause excluded the representation from the contract.

Contracts - Topic 2124

Terms - Express terms - Exclusionary clauses - Validity of - The vendor of a farm orally represented that a farm contained 65 workable acres, but it contained only 51.7 workable acres - The agreement for sale excluded any representations, warranties, collateral agreements or conditions not set out in the agreement in writing - The Ontario Court of Appeal held that the disclaimer clause excluded the negligent misrepresentation of the vendor, because the statement related to the subject matter of the contract and was not a collateral warranty.

Contracts - Topic 3735

Breach - Fundamental breach - Exclusionary clause - Effect of - The Ontario Court of Appeal noted the demise of the doctrine that a fundamental breach of contract deprived the party in breach of the benefit of clauses excluding or limiting his liability - See paragraphs 26 to 27.

Fraud and Misrepresentation - Topic 2508

Misrepresentation - Negligent misrepresentation - The vendor of a 94 acre farm orally represented that the farm contained 65 workable acres, but it contained only 51.7 workable acres - The Ontario Court of Appeal held that the representation was a negligent misrepresentation and not a collateral warranty - See paragraphs 10 to 13, 33.

Fraud and Misrepresentation - Topic 2567

Misrepresentation - Representations - Particular statements - Quantity of land - The vendor of a 94 acre farm orally represented that the farm contained 65 workable acres, but it contained only 51.7 workable acres - The Ontario Court of Appeal held that the representation was a negligent misrepresentation - See paragraphs 10 to 13, 33.

Sale of Land - Topic 946

Contract - Conditions and warranties - Warranty - What constitutes - The vendor of a 94 acre farm orally represented that the farm contained 65 workable acres, but it contained only 51.7 workable acres - The Ontario Court of Appeal held that the representation was not a collateral warranty, but a negligent misrepresentation respecting the subject matter of the contract - See paragraphs 10 to 13, 23, 33.

Cases Noticed:

Redican v. Nesbitt, [1924] S.C.R. 135, consd. [para. 8].

Fraser-Reid et al. v. Droumtekas et al., [1980] 1 S.C.R. 720; 29 N.R. 424, appld. [para. 9].

Hill v. Harris, [1965] 2 All E.R. 358, appld. [para. 12].

Hedley Byrne & Co. Ltd. v. Heller & Partners Ltd., [1964] A.C. 465, appld. [paras. 14, 43].

Esso Petroleum Co. Ltd. v. Mardon, [1976] 2 All E.R. 5, appld. [paras. 15, 33].

Sodd Corporation v. Tessis (1977), 17 O.R.(2d) 158, appld. [paras. 16, 33].

Ronald Elwyn Lister Ltd. v. Dunlop Canada Ltd. (1978), 19 O.R.(2d) 380, refd to. [para. 16].

Case Threshing Machine Company v. Mitten and Other (1919), 59 S.C.R. 118, consd. [para. 18].

Photo Production Ltd. v. Securicor Transport Ltd., [1980] 1 All E.R. 556, consd. [para. 26].

Cain et al. v. Bird Chevrolet-Oldsmobile Ltd. et al. (1976), 12 O.R.(2d) 532, aff'd. 20 O.R.(2d) 569, consd. [para. 27].

Aldershade v. Hendon Laundry Ltd., [1945] 1 All E.R. 244; [1945] 1 K.B. 189, consd. [paras. 28, 45].

Canada Steamship Lines, Ltd. v. R., [1952] 1 All E.R. 305; [1952] A.C. 192 (P.C.), consd. [paras. 28, 45].

Goss v. Lord Nugent (1833), 110 E.R. 713, consd. [para. 35].

De Lassalle v. Guildford, [1901] 2 K.B. 215, consd. [para. 36].

Mendelssohn v. Normand Ltd., [1970] 1 Q.B. 177, consd. [para. 39].

J. Evans & Son (Portsmouth) Ltd. v. Andrea Merzario Ltd., [1976] 2 All E.R. 930, consd. [para. 40].

Brikom Investments Ltd. v. Carr et al., [1979] Q.B. 467, consd. [para. 40].

Carman Construction Ltd. v. Canadian Pacific Railway Co. et al. (1980), 28 O.R.(2d) 232, affd. 33 O.R.(2d) 472 (C.A.), affd. [1982] 1 S.C.R. 958; 42 N.R. 147, consd. [para. 41].

Authors and Works Noticed:

Chitty on Contracts (25th Ed.), para. 879 [para. 45].

Counsel:

R.M. Thompson, for the appellants;

K.K. Beyer, for the respondents.

This case was heard on November 2, 1983 at Toronto, Ontario, before Houlden, Weatherston and Goodman, JJ.A., of the Ontario Court of Appeal.

The judgment of the Court of Appeal was released on February 6, 1984 and the following judgments were filed:

Weatherston, J.A. - see paragraphs 1 to 30;

Houlden, J.A., dissenting - see paragraphs 31 to 46.

Goodman, J.A., concurred with Weatherston, J.A.