Governor's Hill Development Ltd. v. Robert, [1993] GSTC 35 (Ont. Ct. G.D.), aff'd [1996] GSTC 43 (C.A.)

A statement in an agreement of purchase and sale that the "vendor agrees to pay the GST on Penthouse #19" was interpreted to mean that the vendor should absorb the GST that otherwise would be payable by the purchaser on the stipulated purchase price, rather than as meaning that the purchaser would still be responsible for paying GST over and above the purchase price and the vendor would satisfy its obligation merely by remitting the GST collectible by it from the purchaser to the Receiver General.

A clause in an agreement for the sale of a new condominium unit for a purchase price of $775,000 providing that "Vendor agrees to pay the GST" meant that the Vendor was required to absorb the GST applicable to the $775,000 purchase price. Accordingly, the Vendor was required to recover $775,000 from the purchaser, rather than 100/107 of that amount (as alleged by the purchaser). Eberle J. also stated that, had the agreement not made reference to GST, it would have been added to the stated purchase price.