COURT OF APPEAL FOR ONTARIO

Date: 2001-03-01

Docket: C34428

Re: Steven Morton (Applicant/Appellant) – and – Shari Stolpmann and Martin Stolpmann (Respondents/Respondents)

Before: Catzman and Labrosse JJ.A. and Spence J. (ad hoc)

Counsel: Mark Geddes, for the appellant Kurt R. Pearson and Anne Butler, for the respondents

Heard: February 27, 2001

On appeal from the order of Justice Kenneth Pedlar dated May 15, 2000

ORAL ENDORSEMENT

[1] The appellant agreed to purchase a property from the respondents for $106,000 by way of a down payment of $8,000, subject to adjustments, and by making the monthly payments on the mortgage on the property to The Toronto-Dominion Bank, which had a balance of approximately $98,000. In addition, the appellant had the right to pay the balance of the purchase price of $98,000 “at any time upon thirty (30) days notice prior to June 30, 2000”.

[2] By the time the appellant was in a position to pay off the mortgage in return for a deed to the property, the mortgage had been paid down to approximately $71,000. He offered to pay that amount. However, the respondents took the position that the sum of $98,000 was still owing. They argued that $71,000 should go to pay off the mortgage and the balance should go to them.

[3] The motions judge agreed with the respondents.

[4] The purchase price is clearly stated as $106,000 with a down payment of $8,000. In addition, the agreement describes the monthly mortgage payments as part payment of the purchase price of $106,000. The respondent Shari Stolpmann confirmed to the bank that the appellant was taking responsibility for the mortgage. Moreover, nowhere in the agreement is there any reference to “rent” or “lease”.

[5] In our view, the motions judge was in error. His decision results in the appellant receiving no credit against the purchase price for the mortgage payments that he made pursuant to the agreement and it requires the appellant to pay a purchase price which substantially exceeds $106,000. For this reason the agreement is ambiguous on its face and the only reasonable interpretation is that the property was being sold by way of an extended agreement of purchase and sale for $106,000 with a deposit of $8,000 and an assumption of the existing mortgage of $98,000. At the time he offered to pay off the balance of the mortgage, the appellant became entitled to do so and receive a deed of the property.

[6] The appeal is allowed. The order of the motions judge is set aside and in its place an order will go declaring that the amount required in exchange for a deed to the property is the amount owing on the mortgage on the closing date.

[7] In the circumstances, it is not necessary to deal with the cross-appeal and it is dismissed without costs.

[8] The appellant is entitled to his costs of this application and of the appeal.

(signed) “M. A. Catzman J.A.”

(signed) “J. M. Labrosse J.A.”

(signed) “J. Spence J.”