COURT OF APPEAL FOR ONTARIO

CITATION: Talon International Inc. v. Jung, 2014 ONCA 137

DATE: 20140224

DOCKET: C57084

Rosenberg, Hourigan and Benotto JJ.A.

BETWEEN

Talon International Inc.

Applicant

(Respondent in appeal)

and

Henry Jung and Long Ocean Holding Ltd.

Respondents

(Appellants in appeal)

Terry Corsianos, for the appellants

Mark A. Klaiman, for the respondent

Heard: February 5, 2014

On appeal from the judgment of Justice J. Robert MacKinnon of the Superior Court of Justice, dated April 25, 2013.

ENDORSEMENT

[1] The appellant appeals from the judgment of J.R. MacKinnon J. granting an application by the developer Talon International for declarations that the respondent is bound by the agreements of purchase and sale in relation to two units and dismissing the application by the appellant for refund of all deposits they have paid and return of paid net common expenses for interim occupancy changes and accrued statutory interest. For the following reasons the appeal is dismissed.

[2] We agree with the application judge that the May 2012 disclosure statement was a revised disclosure statement for the purpose of s. 74(3) of the Condominium Act. The 2012 statement must be read as a whole, including the summary that was delivered at the same time. The two documents “clearly identify all changes that in the reasonable belief of the declarant may be material changes and summarize particulars of them” within the meaning of s. 74(3).

[3] We also agree with the application judge that there were no material changes as that term in now defined in the Act. The term “material change” has a statutory definition in s. 74(2) which is purely objective. Obviously, the objective standard must take into account the context, but a purely subjective view, such as the difference to the purchaser, in this case, between a 70 story and a 60 story building does not meet this standard.

[4] The essential context in this case in which to consider the issue of the alleged material changes is that these units were for investment purposes in a hotel. Thus, the primary issue, and the one addressed in the expert report, was whether any of the changes reasonably affected the value for investment purposes. These were not units that the purchaser was expected to occupy as if they were residential units. There was no evidence that access to the PATH met the test for material change. The application judge gave close consideration to this issue and we have not been persuaded that he made any error in finding that the access to the PATH for this building in these particular circumstances was a material change.

[5] We also agree with the application judge that the alleged costs shifting did not represent a material change. We also agree with the application judge that the alleged cost shifting represented a material change. There are different ways to compare the changes, some of them as a result of the change in the number of stories. It was for the application judge to choose that comparison and absent a palpable and overriding error, this court cannot interfere. In addition we note the evidence that on one way of calculating the differences, which is reasonable given the investment nature of the units, the changes represent only very small differences in the common expenses that the purchaser must pay.

[6] Given our conclusion that this was a revised disclosure statement and that there were no material changes, it is unnecessary to decide the issue of whether the notices of rescission were brought in a timely way.

[7] The respondent is entitled to its costs fixed at $10,767.49 inclusive of HST and disbursements.

“M. Rosenberg J.A.”

“C.W. Hourigan J.A.”

“M.L. Benotto J.A.”