Alex Valova

Following dismissal of the plaintiffs’ claim for conversion arising from the removal of chattels prior to a real estate closing, the court addressed costs.

Although the defendants were technically successful at trial and had made several settlement offers under Rule 49 of the Rules of Civil Procedure, the court found that the defendant real estate agent had engaged in fraudulent and dishonest conduct, including theft of property, misleading discovery evidence, and concealment of witnesses and documents.

Relying on the discretion under s. 131 of the Courts of Justice Act and the misconduct exception recognized in appellate authority, the court departed from the usual rule awarding costs to the successful party.

The court ordered the defendants to pay partial indemnity costs to the plaintiffs to sanction the misconduct and discourage similar behaviour.

The plaintiffs purchased a home under power of sale.

Before closing, the defendant real estate agent removed numerous high-quality chattels from the property and caused damage to the flooring.

The plaintiffs sued for conversion and property damage.

The court found that the defendant had no authority to remove the items and acted deceitfully.

However, the action was dismissed because the plaintiffs did not have ownership or possession of the chattels at the time they were taken, holding only an expectancy.

The property damage claim was also dismissed because the plaintiffs failed to first seek recourse against the vendor bank as trustee.