The Second Opinion: Can You Get Your Money Back? The B.C. Court OF Appeal Addresses The Forfeiture OF Deposits (Again)

Can a party who has failed to consummate a transaction get back a "deposit"? The British Columbia Court of Appeal considered this issue once again in the recent case of Amiri v. One West Holdings Ltd., 2013 BCCA 155.

The facts of the Amiri decision were as follows. A businessman ("Purchaser") purchased, in 2005, a condominium that was to be built for a total price of almost $3 million. The purchase agreement (the "Agreement") provided for the payment of a total "deposit" in the amount of approximately $750,000. The Agreement specifically stated that "[i]f the Purchaser is in breach of any of the covenants or obligations hereunder, the Vendor may, at its election, retain the Deposit...as liquidated damages." The Agreement went on to state that "[t]he parties...agree that [the Deposit] constitutes a genuine pre-estimate of the minimum damages suffered by the Vendor" and that the "Vendor reserves the right to claim for further damages." Time was of the essence for the Agreement.

The Vendor provided notice to the Purchaser that the closing date was going to be March 15, 2010. The Purchaser was abroad and received the notice in early March. However, he suffered a motor vehicle accident and was...