Court File and Parties

Court of Appeal for Ontario Date: 20220119 Docket: C69335

Judges: Doherty, Tulloch and Thorburn JJ.A.

Between:

George Leslie Scott and Harriet Brav-Baum Plaintiffs/Defendants by Counterclaim (Respondents in Appeal)

And:

Shoreh Forjani a.k.a. Shoren Konstantin Defendant/Plaintiff by Counterclaim (Appellant in Appeal)

Counsel: Hossein Niroomand, for the appellant Gregory Weedon, for the respondents

Heard: January 6, 2022 by video conference

On appeal from the judgment of Justice James F. Diamond of the Superior Court of Justice, dated March 18, 2021 and reported at 2021 ONSC 1996.

Reasons for Decision

[1] The appellant agreed to purchase the respondents’ property for $1,450,000. Under the terms of the Agreement of Purchase and Sale (“APS”), the transaction would close some 13 months later.

[2] The appellant eventually refused to close. She alleged the respondents had failed to disclose certain latent defects and had failed to maintain the property.

[3] The respondents relisted the property and eventually sold it for $1,120,000.

[4] The respondents sued the appellant for failing to close the transaction. They sought:

• forfeiture of the $72,500 deposit;
• damages reflecting the difference between the price the appellant had agreed to pay ($1,450,000) and the price the respondents were eventually able to obtain for the property ($1,120,000); and
• certain legal expenses.

[5] The respondents first moved for forfeiture of the appellant’s deposit, claiming the appellant had acted in bad faith when she did not close the transaction. Leiper J. held the appellant had breached the APS and acted in bad faith. She ordered the deposit forfeited. The appellant did not appeal from the order of Leiper J., although it appears she has challenged that order in a separate motion that is not before this court.

[6] After Leiper J. determined the appellant had breached the APS, the respondents moved for summary judgment on the issue of damages. The respondents argued they were entitled to the difference between the price at which the appellant had agreed to purchase the property and the market value of the property when the respondents actually sold it. The respondents argued that the price at which they sold the property was an accurate reflection of its market value. The appellant maintained the respondents had failed to demonstrate any damages arising out of the appellant’s failure to close the transaction. The appellant also advanced a counterclaim. That counterclaim was not part of the summary judgment motion.

[7] The motion judge had only one issue before him – did the respondents establish their damages and, more specifically, had the respondents failed to mitigate their damages when they sold the property for considerably less than the amount the appellant had agreed to pay for the property?

[8] The motion judge’s determination of the sole issue before him turned on whether the price at which the respondents sold the property ($1,120,000) reflected the true value at the time of that sale. The appellant tendered affidavits from three “experts” who provided opinions indicating the value of the property was well above the price at which the respondents had eventually sold the property. The appellant chose not to lead any evidence about the qualifications or experience of those “experts”.

[9] The motion judge declined to give the opinions of the appellant’s “experts” any weight. He held, that without evidence of their experience and background, he could not give their opinions any evidentiary value. The motion judge went on to consider the rest of the evidence adduced on the motion. He concluded, at para. 44:

It is clear from the record that market forces, and not anything done or not done by the plaintiffs [respondents], dictated the sale price of the property in the fall of 2018. The value of the property is typically what a purchaser is willing to pay for it. Poor market conditions were responsible for the reduced purchase price in this case. There is no evidence to the contrary, and the best and most reliable evidence is what actually happened from July to November 2018.

[10] The motion judge proceeded to grant judgment in the amount claimed.

[11] The appellant submits the motion judge erred in law by ruling the affidavits of the “experts” inadmissible. As I read the motion judge’s reasons, he did not rule the affidavits inadmissible, but rather concluded that he could give no weight to those opinions without any evidence setting out the “experts’” experience and training.

[12] Parties are required to put their best evidentiary foot forward on summary judgment motions. The appellant failed to do so. It was open to the motion judge to conclude the evidence offered by the appellant on the issue of the value of the property at the relevant time had no probative force. That finding left only the evidence of the respondents, most notably the evidence of the actual price at which the property was sold. The motion judge made a finding as to the value of the property based primarily on that evidence.

[13] Counsel for the appellant also argued that the motion judge erred in drawing an adverse inference from the appellant’s refusal to allow one of her witnesses to answer questions about his expertise and qualifications. Counsel submits the appellant was unrepresented when she refused to allow the witness to answer the questions and that the trial judge should have taken that into account before drawing an adverse inference against her.

[14] The appellant offered the affidavit of the “expert” to support her claim that the respondents sold the property well under market value. As a matter of common sense, it is plain and obvious that the “expert’s” experience and training would be relevant to the weight to be assigned to the opinion. The appellant refused to allow the witness to answer questions that were obviously relevant to the weight to be attached to the opinion offered by that witness. The most obvious explanation for the refusal to answer the question is that the answer would not help the appellant’s claim the property was sold under value. The logic of the adverse inference drawn from the appellant’s refusal to allow the witness to answer those questions was not dependent on whether the appellant was legally trained.

[15] The appeal is dismissed. Funds in the amount of $308,568.84, presently being held in trust by the Accountant of the Superior Court, pursuant to an order of this court, are to be released to counsel for the respondents forthwith.

[16] The respondents are entitled to their costs of the appeal in the amount of $15,000, “all in”. Counsel agree that the $15,000 attributable to costs is to come from the $308,568.84 held in trust, and is not in addition to that amount.

Doherty J.A. M. Tulloch J.A. J.A. Thorburn J.A.