Court of Appeal for Ontario

Citation: Camsal Inc. v. Penner International Inc., 2022 ONCA 20

Date: 2022-01-13

Docket: C69252

Before: Huscroft, Trotter and Coroza JJ.A.

Between:

Camsal Inc.

Applicant (Respondent)

and

Penner International Inc.

Respondent (Appellant)

Counsel:

Michael McWilliams and Tamara Watson, for the appellant

Jordan Diacur and Michael Bordin, for the respondent

Michael Beeforth, for the interveners 213748 Ontario Inc. o/a Peace Transportation, 2232665 Ontario Inc. o/a D’Alliance Motors and Roadish Transport Inc.

Heard: January 11, 2022 by video conference

On appeal from the order of Justice Antonio Skarica of the Superior Court of Justice, dated February 24, 2021.

Reasons for Decision

[1] The appellant argues that the application judge erred in finding that the respondent was free to sell the property in question to a third party despite the right of first refusal the appellant had pursuant to the terms of its lease of that property. The appellant argues, further, that the application judge erred by implying a term into the right of first refusal limiting it to a single use.

[2] We disagree.

[3] We see no extricable error in the application judge’s analysis. Thus, in the absence of a palpable and overriding error, his interpretation of the lease is entitled to deference: Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633. The appellant has failed to establish any such error.

[4] By its terms, the right of first refusal permitted the appellant to submit an offer to purchase the property upon the same terms and conditions as any offer received by the respondent. The application judge found that the respondent duly informed the appellant of the offer it had received from the interveners. The appellant then submitted an offer to purchase on identical terms, including a buyer’s financing condition, which gave the appellant 30 days to obtain suitable financing. Twenty-nine days later, the appellant sought a two-month extension of the buyer’s condition. The respondent refused. The appellant then advised the respondent that it would not be waiving the condition and requested the return of its deposit. Consequently, the agreement of purchase and sale expired in accordance with its terms.

[5] The application judge applied the proper interpretive principles and read the contract as a whole. The application judge did not imply any terms into the right of first refusal. He interpreted the right of first refusal as being exercisable only once. This interpretation is commercially reasonable and there is no basis for this court to interfere with it. Whether the appellant had notice of the subsequent unconditional agreement of purchase and sale entered into by the respondent is irrelevant, as the right of first refusal was already spent.

[6] The appeal is dismissed. The respondent is entitled to costs in the agreed amount of $16,000, all inclusive. No costs order is made concerning the interveners.

“Grant Huscroft J.A.”

“Gary Trotter J.A.”

“S. Coroza J.A.”