Court File and Parties

COURT OF APPEAL FOR ONTARIO DATE: 20230609 DOCKET: C70711

Doherty, Hoy and Harvison Young JJ.A.

BETWEEN

John Harold White Defendant (Appellant in Appeal)

and

Yvan Gauthier Plaintiff (Respondent in Appeal)

Counsel: Michael Cupello, for the appellant Jordan Lester, for the respondent

Heard and released orally: June 5, 2023

On appeal from the judgment of Justice W.D. Newton of the Superior Court of Justice, dated April 28, 2022.

Reasons for Decision

[1] The respondent/purchaser claimed that he agreed to buy the appellant’s property for $40,000 and that he paid the entire amount in installments prior to signing an Agreement of Purchase and Sale (“APS”). The appellant/vendor maintained that the agreement was in fact to sell the property for $80,000, consisting of a deposit of $40,000, which he agrees the respondent had paid, and a purchase price of $40,000, which he contends the respondent did not pay.

[2] The trial judge was satisfied that the APS called for a total purchase price of $40,000, the amount paid by the respondent. He gave judgment in favour of the respondent.

[3] We see no error in the trial judge’s reasons. The contemporary rules of contractual interpretation require a contextual consideration of the language used in the agreement. The interpretative process must engage the factual matrix in which the contract was created: see G. Hall, Canadian Contractual Interpretation Law, 4ed 2020, Ch. 1-2.

[4] The trial judge did exactly that. He interpreted the agreement consistent with the surrounding circumstances in accordance with the judgment of the Supreme Court of Canada in Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53.

[5] On the findings of fact made by the trial judge, the factual matrix existing when the APS was signed by the parties included:

• The parties had orally agreed to a purchase price of $40,000 several months before entering into the APS. The respondent had paid that $40,000, as agreed on, in several installments and the appellant had acknowledged these receipts on account of the purchase price; and
• The respondent had taken possession of the property and was in the process of making extensive repairs.

[6] On its face, the language of the APS provided for a “purchase price” of $40,000 and a “deposit” of $40,000. The “deposit” was “to be credited toward the purchase price”. The APS contained no terms referable to the payment of the deposit.

[7] While it is perhaps fair to say that the language of the preprinted form used by the parties did not rest entirely comfortably with the circumstances as they existed when the parties signed the document, on a plain reading, it is clear that the purchase price was $40,000. The deposit also for $40,000, was to be credited toward that $40,000 purchase price.

[8] Considering the language of the APS in the factual context as found by the trial judge, it was certainly open to the trial judge to conclude that the purchase price contemplated in the APS was $40,000. The interpretation of the language was consistent with the trial judge’s finding as to the understanding of the parties. The trial judge did not believe the appellant’s evidence that the total purchase price was $80,000. He found that the appellant believed, in fact, that the price was $40,000. He rejected the appellant’s evidence, in part, because he accepted the respondent’s evidence to the contrary, but also because the appellant’s evidence was inconsistent with the evidence of his own lawyer on the transaction, and with documentation signed by the appellant.

[9] The entire agreement clause did not preclude the trial judge from considering the surrounding circumstances in interpreting the agreement.

[10] The appellant submitted that the trial judge did not put “any or enough” weight on the opinion of the appraiser called by the appellant at trial as to the value of the property. The trial judge was clearly alive to the appraiser’s evidence. He described that evidence as “inconclusive”. That assessment was open to trial judge on the evidence he heard and we must defer to that assessment.

[11] The appeal is dismissed. Pursuant to the agreement of the parties, the respondent is entitled to costs fixed at $15,000, inclusive of disbursements and relevant taxes.

“Doherty J.A.”

“Alexandra Hoy J.A.”

“A. Harvison Young J.A.”