Any party to a contract can add or reduce their obligations to the legal warranty, but cannot be released from their personal actions, unless the buyer purchases without warranty and at their own risk from a non-professional seller.
The majority of sales made in Quebec are done with the legal guarantee stipulated in the Civil Code of Quebec. What about the validity of a clause that excludes this guarantee?
A financial institution, having taken over a property, sells it to an entrepreneur at 25% of the municipal evaluation value. The sales agreement states that the entrepreneur buys the property without any guarantee, at his own risk, and undertakes to take the property as it is. During the excavation of the foundations, the entrepreneur discovers that the land is polluted with hydrocarbons. He turns to the Court* and requests the cancellation of the sale.
The entrepreneur alleges that the financial institution should be considered as a professional seller who, according to the Civil Code of Quebec, is presumed to "know the existence of the defect affecting the property". The seller was aware of the dilapidated condition of the building but unaware of the defect, and never intended to guarantee the property. The sale was made without warranty and at the buyer's own risk, who declared himself satisfied after inspecting it, but failed to conduct an environmental check.
The Court reiterates that any party to a contract can add or diminish their obligations to the legal guarantee but cannot exempt themselves from their own actions, unless the buyer purchases without warranty and at his own risk from a non-professional seller. The Court rejects the buyer's claim and declares that the financial institution cannot be considered a professional seller because its "main occupation is not the sale of goods". Therefore, the exclusion of warranty is valid, and unfortunately for him, the entrepreneur must assume the risks of his business without being able to implore the saints.
*200-05-013379-008 (C.A.)
