Court File and Parties

CITATION: Banwait v. 2167661 Ontario Limited, 2008 ONCA 862

DATE: 20081219

DOCKET: C49318

COURT OF APPEAL FOR ONTARIO

O’Connor A.C.J.O., Doherty and Moldaver JJ.A.

BETWEEN:

Ravinder Banwait

Applicant (Respondent)

and

2167661 Ontario Limited, John Kudlak and Mary Kudlak

Respondents (Appellants)

Jeffrey W. Kramer and Amandeep S. Dhillon for the appellants

R. Leigh Youd for the respondent

Heard and released orally: December 16, 2008

On appeal from the order of Justice Thea Herman of the Superior Court of Justice dated July 31, 2008.

ENDORSEMENT

[1] The appellants raise two issues on appeal.

[2] First, they submit that the application judge erred in finding that the pylon sign in the engineering drawings accords with the terms of the lease. That finding, they submit, does not fit with the evidence and amounts to an impermissible rewriting of the terms of the lease.

[3] In particular, the appellants argue that the lease refers to “a rental area of approximately 4 sq. ft. for the footprint (base) of the pylon”, whereas the engineering drawings show the footprint (base) as being a 70 sq. ft. above-ground pedestal. The appellants further complain about the placement of the pylon. In the engineering drawings, it is located approximately 13 ft. south west of the location provided in the lease.

[4] With respect to the size of the footprint (base), the application judge made the following observations: (1) the lease did not limit the size of the foundation needed to support the pylon; (2) the appellants accepted that the foundation could be greater than 4 sq. ft.; (3) the engineering evidence provided that “the foundation of the sign includes the [70 sq. ft.] pedestal”; and (4) the pylon to be erected measured 5 ft in diameter and it was to be mounted on a metal plate which sat on top of the pedestal and measured 6 ft in diameter.

[5] Taking those factors together, although she did not say so explicitly, it is apparent that the application judge considered that the 70 sq. ft. pedestal formed part of the foundation and as such, it did not offend the terms of the lease.

[6] The application judge concluded her analysis of this issue by noting that the parties “understood and intended that the dimensions set out in the lease were of necessity imprecise and were subject to change once the [engineering] drawings had been completed.” In our view, that finding was open to the application judge having regard to the following considerations: (1) the language of the lease in describing the dimensions of the footprint uses the word “approximately”; (2) the word “footprint” is not itself a defined term and on the evidence, it is apparently not a term used in the description of the construction of these types of signs; (3) the word “suitable” was used to describe the foundation, indicating an attempt to rely on others with expertise to fix the exact dimensions and location necessary to properly erect these types of signs; and (4) Exhibit E to the lease is a picture of a “sample billboard structure to be placed”. The picture demonstrates that the size of the pole itself is considerably larger than 4 sq. ft.

[7] The application judge made a similar finding in relation to the precise location of the pylon. That too was something that the parties understood would not be finalized until the completion of the engineering drawings and they were content to sign the lease on that basis.

[8] In our view, the record supports the application judge’s ultimate conclusion that the provisions of the lease were “not precise with respect to the size and location of the sign structure”. Accordingly, it was open to the application judge to conclude that engineering drawings accords with the terms of the lease. In coming to this conclusion it is not necessary to have regard to the evidence of industry practice. We do not accept the submission that this interpretation leads to a commercial absurdity.

[9] Accordingly, the first ground of appeal must fail.

[10] The second ground of appeal concerns the application judge’s decision to order the trial of an issue on the question of remedy and specifically, whether the respondent can obtain specific performance.

[11] The appellants submit that the application judge was wrong to even consider the remedy of specific performance, since it was not pleaded. Alternatively, they submit that it is not available on the evidence as there is no basis for concluding that the property and the lease are “unique” and the respondent can be adequately compensated by an award of damages.

[12] We disagree with both of these submissions.

[13] The application judge recognized that the remedy of specific performance had not been pleaded. Nonetheless, she concluded that the appellants were not prejudiced by this and she gave the parties ample opportunity to address the issue. She was entitled to exercise her discretion in that fashion and we see no basis for interfering.

[14] As for the second argument, while we acknowledge that the remedy of specific performance may be difficult to establish, we think it was open to the application judge to treat it as a live issue in the particular circumstances of this case. Accordingly, she did not err in ordering the trial of an issue on the question of remedy.

[15] For these reasons, the appeal must be dismissed.

[16] Costs to the respondent are fixed in the amount of $7,264 inclusive of disbursements and G.S.T.

Signed: “D. O’Connor A.C.J.O.”

“Doherty J.A.”

“M. J. Moldaver J.A.”