This case involved an application and counter-application concerning a commercial sub-lease and an option to purchase real property.
The Landlord (2405416 Ontario Ltd.) sought a declaration that the Tenant (2405490 Ontario Inc.) had defaulted on the sub-lease, terminating it, and obligating the Tenant to sell its business to the Landlord.
The Tenant counter-applied for a declaration compelling the Landlord to sell the premises under the option to purchase, and for damages for rent paid.
The court found that the Tenant was not in default regarding rent payments or renovations, interpreting the lease's rent commencement date as conditional on the closing of an Asset Purchase Agreement and the issuance of a body-rub licence.
The court also found the Landlord's complaints to be a pretext for refusing to comply with its obligations.
The Tenant's counter-application was granted in part, affirming its right to purchase the property, but its claim for damages for rent paid was dismissed.
The Landlord's application was dismissed.