Court File and Parties

Court of Appeal for Ontario Date: 2024-01-12 Docket: COA-23-CV-0462

Before: Hourigan, Trotter and Copeland JJ.A.

Between: Mohamed Elbassiouni and Shaimaa Badr Plaintiffs (Appellants)

And: Michelle Brenn Defendant (Respondent)

Counsel: Saad Suleman, for the appellants M. Mark Fahmy, for the respondent

Heard: January 10, 2024

On appeal from the order of Justice Charles C. Chang of the Superior Court of Justice on March 10, 2023.

Reasons for Decision

Introduction

[1] The appellants appeal from an order granting a motion for summary judgment arising from a dispute over the purchase and sale of a residential property. The action was commenced under the Simplified Procedure: Rules of Civil Procedure, R.R.O. 1990, Reg. 194, r. 76.

[2] The appellants (who were the purchasers) alleged that the respondent/vendor breached the following warranties in the Agreement of Purchase and Sale (“APS”):

The Seller warrants that to their knowledge, the pool and hot tub are in excellent working condition.

The Seller represents and warrants to the best of their knowledge and belief that the heating systems servicing the indoor pool area is now, and will be on the completion date be [sic] in good working order. The parties agree that this representation and warranty shall survive and not merge on completion of this transaction.

[3] After the transaction closed, the appellants alleged deficiencies in the amenities that were the subject-matter of the warranties, and also that the hot water heater and propane tank were rented as opposed to owned equipment.

The Summary Judgment Motion

[4] The respondent brought a motion for summary judgment. The motion judge concluded that there was no genuine issue for trial. He found that the appellants failed to establish liability based on the wording of the warranties in the APS. In reaching this conclusion, he relied on the respondent’s affidavit concerning her belief in the functionality of the equipment in issue. He also relied on a home inspection report obtained by the respondent, and made available to prospective purchasers (including the appellants), which recommended pool repairs, and an invoice to prove that the respondent undertook those repairs.

[5] On the other hand, the motion judge found that the appellants produced only inadmissible opinion evidence from contractors. Moreover, they adduced no evidence to contradict the respondent’s genuine belief concerning the items in issue. The motion judge further held that there was no evidence that the heaters and de-humidifiers were non-functional on closing.

[6] There is more. The motion judge said, at para. 38: “More problematic for the plaintiffs is their failure to adduce any evidence of their recoverable damages.” He noted that they produced an estimate for the complete replacement of the de-humidifier system, not what it would cost to repair the equipment. Moreover, the appellants failed to prove that the work was actually completed. Although the appellants produced a cheque for the work to be done, there was no evidence that the cheque was cashed/deposited, or that they paid any further amounts. This led the motion judge to conclude, at para. 41: “There is no evidence of any kind whatsoever of any damages suffered respecting the heaters for the pool water or pool area.” He made similar findings for the other items claimed by the appellants.

[7] The motion judge granted summary judgment in favour of the respondent and ordered all-inclusive costs of $20,000.

Analysis

[8] The appellants submit that the motion judge erred in finding that this was an appropriate case for summary judgment; instead he should have ordered a summary trial. In their submissions, the appellants re-hash the same arguments made before the motion judge. We do not accept these submissions.

[9] This was an appropriate case for summary judgment. It involved a straightforward real estate transaction. In terms of liability, it involved an interpretation of warranties that were drafted in a manner very favourable to the respondent. The motion judge found there was nothing to contradict the respondent’s assertion of her genuine belief. He also found that it was even “[m]ore problematic” that the appellant’s failed to adduce any admissible evidence that they suffered damages as a result of the alleged breaches. On the admissible evidence before him, it was open to the motion judge to reach these conclusions. We are also satisfied that they are explained sufficiently in his reasons.

[10] The appellants also submit that the summary judgment motion was conducted unfairly. Leading up to the summary judgment motion, one of the appellants (Mr. Elbassiouni) and the respondent were examined by opposing counsel. Mr. Elbassiouni’s examination was completed; however, the examination of the respondent was not, and a further date was scheduled. In the meantime, a dispute arose between the parties as to whether these were cross-examinations on affidavits, or examinations for discovery. At an impasse, the respondent’s examination never resumed.

[11] Upon reviewing the transcripts of the examinations, the motion judge concluded that they were inadmissible under r. 76.04, which provides:

No Written Discovery, Cross-Examination on an Affidavit or Examination of a Witness

76.04 (1) The following are not permitted in an action under this Rule:

1. Examination for discovery by written questions and answers under Rule 35.
2. Cross-examination of a deponent on an affidavit under rule 39.02.
3. Examination of a witness on a motion under rule 39.03.

Limitation on Oral Discovery

(2) Despite rule 31.05.1 (time limit on discovery), no party shall, in conducting oral examinations for discovery in relation to an action proceeding under this Rule, exceed a total of three hours of examination, regardless of the number of parties or other persons to be examined. [Emphasis added.]

[12] The motion judge was aware that, by implication, r. 76.04(2), permits oral examinations for discovery. However, he rejected the characterization of the examinations in this case as examinations for discovery. He found that they were cross-examinations of deponents on their affidavits under r. 39.02, and said at para. 7: “The parties’ attempt to have the transcripts found to be admissible by characterizing these examinations as ‘discovery’ is nothing more than a thinly veiled attempt to circumvent the Rules of Civil Procedure.”

[13] We see no error in the motion judge’s characterization of the examinations that were conducted by the parties. Moreover, we do not accept the appellants’ submission that the motion judge acted improperly by reviewing the transcripts. This is a puzzling submission because the appellants wanted the motion judge to consider the transcripts. In any event, it was necessary for the motion judge to examine the transcripts in order to evince the true nature of the examinations. There is no indication that he made any greater use of them.

[14] Further, we do not accept that the motion judge erred in considering the respondent’s reply affidavit, which was filed late (i.e., following the dispute that arose over the examinations of the parties, and after a scheduling deadline set by the motion judge). When appellants’ counsel objected to its admission, the motion judge asked if the appellants were seeking an adjournment. The appellants did not seek an adjournment and indicated their readiness to proceed, even if the reply affidavit were to be admitted. The motion judge properly exercised his discretion to proceed in the circumstances. There was no unfairness.

[15] Lastly, we are not persuaded that the motion judge made any error in principle in his costs award. He gave thorough reasons for why he concluded $20,000 was appropriate in the circumstances. We see no basis on which to intervene.

Conclusion

[16] The appeal is dismissed. The respondent is entitled to her costs in the amount of $8,000, inclusive of HST and disbursements.

"C.W. Hourigan J.A.”

“Gary Trotter J.A.”

“J. Copeland J.A.”