Court of Appeal for Ontario
Between:
Richard G. Pyne, In Trust
Plaintiff (Respondent)
and
Jennifer Brocklesby Footman
Defendant (Appellant)
Before: Feldman, Lang and Epstein JJ.A.
Counsel:
R. Leigh Youd for the appellant
Jonathan Speigel for the respondent
Heard: June 3, 2008
On appeal from the judgment of Justice Joseph Henderson of the Superior Court of Appeal dated April 18, 2007.
Endorsement
1The respondent is a lawyer who represented Mr. Rizzuto in his attempt to purchase the property of the appellant.
2Mr. Rizzuto wanted the property for development. He approached the appellant together with her husband about the possibility of purchasing the property. Through his real estate agent, Mr. Durbano, he made a written offer to purchase the property, which Mr. Durbano delivered to the Footmans.
3After considering the offer, the Footmans contacted Mr. Durbano and told him they would be willing to sell, but for a higher price and as long as they could live on the property rent-free for three years after closing. Mr. Durbano typed up a sign-back with these terms, had it initialled by Mrs. Footman and delivered it to Mr. Rizzuto on Sept 1, 2000. The sign-back was irrevocable until September 6 at 5:00 p.m.
4Mr. Rizzuto was content with the new price but was concerned about the three-year occupancy period. He asked Mr. Durbano to contact the Footmans and see whether, instead of three years’ occupancy, they would accept six months or one year occupancy.
5There were at least two telephone conversations between Mr. Durbano and Mr. Footman but they disagreed about what was discussed and agreed. The trial judge found that there was a misunderstanding between them on the occupancy issue but that “the Footman’s position prevailed as there is no doubt that the Footman offer with a three-year occupancy clause remained outstanding and open for acceptance.”
6Mr. Durbano reported to Mr. Rizzuto that the Footmans were prepared to accept a one-year occupancy. However, Mr. Rizzuto did not want to risk jeopardizing the deal by signing back the Footmans’ offer so instructed Mr. Durbano that he would accept their offer, but that Mr. Durbano should continue to explore a one-year occupancy.
7When he was unable to arrange a meeting with Mrs. Footman, Mr. Durbano followed Mr. Rizzuto’s instructions by delivering to the Footman residence before 5:00 p.m. on September 6, the Footman offer fully signed by Mr. Pyne in trust, but enclosed a covering letter which read as follows:
Dear Mr. and Mrs. Footman,
Enclosed please find accepted Agreement of Purchase and Sale for your property.
As discussed and agreed to yesterday, the period that you would be staying on the property would be for one (1) year after closing. Accordingly, please find Amendment to Agreement for your signature. [Emphasis added.]
I will drop these documents in your mail-box today, as directed by Mr. Footman this morning at 9:40 a.m., as he informed me that Mrs. Footman is not available until tomorrow.
I would like to take this opportunity to thank you for allowing me in your home and taking part in the sale of your property.
8An amending agreement signed by the respondent was enclosed in triplicate that removed the three-year occupancy, substituted one year, and imposed a physical restriction on the area to be used. No consideration was suggested for the amendment.
9The appellant took the position that there was no agreement and refused to close the transaction.
10The main issue before the trial judge was whether the respondent had clearly and unequivocally accepted the appellant’s sign-back offer. He found that he had. The trial judge concluded that based on the telephone conversations between Mr. Durbano and Mr. Footman that preceded the delivery of the signed agreement, the letter and the signed amending agreement, the Footmans should have understood that they had a deal with the three-year occupancy and that the one-year amendment was just an optional proposal.
11With respect to the trial judge, we do not agree that this conclusion was available based on the trial judge’s findings and the documentary record.
12Taken alone, the letter of September 6 could not be read as offering an option to the Footmans. It states that the Footmans had already agreed to the amendment and presented it for Mrs. Footman’s signature. Read fairly, it appears to enclose the signed agreement for the purpose of amending it with the signed amending agreement.
13The finding by the trial judge that the Footmans should have known that they had a deal for three years occupancy based on Mr. Footman’s conversations with Mr. Durbano is not consistent with Mr. Durbano’s understanding that they had agreed on one year, or with the trial judge’s finding that there was a misunderstanding between them on the issue.
14The trial judge also concluded that if there was any confusion, it was Mrs. Footman’s fault for not being available personally to receive the accepted offer and an explanation about the intent of the amending agreement. This conclusion is wrong in law. The acceptance of the offer was made by delivery in writing to the address. There was no obligation for Mrs. Footman to be personally available or to receive any explanations. Furthermore, this finding on its own refutes the conclusion that the respondent’s acceptance of the Footman counter-offer was clear and unequivocal.
15In our view, this case is governed by the Supreme Court decision in Harvey v. Perry 1953 CanLII 64 (SCC), [1953] 1 S.C.R. 233, part of the headnote of which says: “The whole of the correspondence, interviews and conduct of the parties showed that they had not agreed upon the terms of a contract and that the respondent, up to the conclusion of the negotiations, was still trying to obtain terms more satisfactory to himself.”
16In light of our conclusion on the main issue, we do not need to address the two other issues raised by the appellant on the appeal, relating to the expert evidence at trial and the trial judge’s decision not to allow an amendment to the statement of claim mid-trial because of non-compensable prejudice to the defendant.
17The appeal is allowed with costs of the appeal fixed at $15,000, inclusive of disbursements and G.S.T. Costs of the trial to the appellant fixed in accordance with the award made by the trial judge to the respondent at $60,000 for fees on the partial indemnity scale, plus disbursements and G.S.T.
Signed: “K. Feldman J.A.”
“S.E. Lang J.A.”
“G. Epstein J.A.”
