Court of Appeal for Ontario

Citation: Bertoia v. McKenzie Investments and Leasehold Ltd., 2010 ONCA 664

Date: 2010-10-08

Docket: C51644

Before: Cronk, Blair and LaForme JJ.A.

Between:

Louis Bertoia, Al Bertoia, Beatrice Bertoia and The Estate of Licinio Bertoia Plaintiffs (Appellants)

and

J. Glos Architect Inc., In Trust for McKenzie Investments and Leasehold Ltd. Defendants (Respondents)

Counsel: Anthony L. Giannotti and Robert G. Matlack, for the appellants Avril A. Farlam, for the respondents

Heard and released orally: October 5, 2010

On appeal from the judgment of Justice Richard C. Gates, of the Superior Court of Justice, dated January 8, 2010.

ENDORSEMENT

[1] This litigation arose from an aborted real estate transaction in the City of Windsor. The agreement of purchase and sale identified the purchaser as "J. Glos Architect Inc., In Trust" (emphasis added). When the named purchaser failed to close the transaction, the appellants sued "J. Glos Architect Inc., In Trust for McKenzie Investments and Leasehold Ltd." for damages.

[2] Prior to commencement of the lawsuit, counsel for the respondents had written to the appellants' counsel confirming that the property was being purchased in trust, as was adjacent property, and disclosing the identity of the beneficiary of the trust, namely, McKenzie Investments and Leasehold Ltd.

[3] After this disclosure, the appellants pleaded in their original and amended statement of claim that the respondent J. Glos Architect Inc. was "the trustee for the corporate [respondent] McKenzie Investments and Leasehold Ltd.". This alleged fact was expressly admitted and relied on by the respondents in their statement of defence. No reply pleading was delivered by the appellants.

[4] The case at trial was conducted on this basis. The appellants did not move to vary or amend their pleading, in any way, until after the close of the evidentiary phase of the trial. Their motion to vary or amend their pleading at that stage was denied by the trial judge.

[5] The appellants now argue that the trial judge was wrong to hold that only the corporate beneficiary of the trust was liable for damages and, further, that he erred in denying the appellants' end-of-trial pleadings motion.

[6] We disagree. On the basis of the pleadings as framed, the question of the Glos company's status as a trustee was not a live issue at trial. Rather, it had been expressly admitted by the appellants in their pleading. The respondents, therefore, had no need to lead evidence as to the existence of the trust although, in fact, there was some evidence on this issue led through the trial testimony of J. Glos.

[7] While we accept that there is no "legal magic" to the insertion of the words "In Trust" in a commercial document, this case is unlike those relied on by the appellants in that the Glos company signed the agreement of purchase of sale with an explicit qualification of its status. Moreover, a beneficiary of the trust existed, the identity of which was disclosed to the appellants in advance of the litigation. These facts distinguish this case from the authorities cited by the appellants.

[8] Finally, on the facts described above, we are not satisfied that any violation of the Statute of Frauds occurred.

[9] The appeal is dismissed. The respondents are entitled to their costs of the appeal, fixed in the total amount of $10,000, inclusive of disbursements and all applicable taxes.

"E.A. Cronk J.A."

"R.A. Blair J.A."

"H.S. LaForme J.A."