Peter Manderville

The appellants appealed a trial judgment finding them jointly and severally liable for breach of contract for non-payment of a real estate commission.

The Court of Appeal dismissed the appeal, upholding the trial judge's findings that a binding contract for commission was formed, that the action was not barred by the Real Estate and Business Brokers Act, 2002, and that the corporate and individual appellants were jointly and severally liable as parties to the contract.

The plaintiffs, having been wholly successful in their breach of contract action for a real estate commission, sought substantial indemnity costs from the date of their offer to settle and full indemnity costs based on the defendants' bad faith.

The defendants conceded entitlement to partial indemnity costs to the offer date and substantial indemnity thereafter but challenged the quantum and the claim for full indemnity.

The court, applying Rule 57.01 factors and the principle of proportionality, found the plaintiffs' claimed hours to be disproportionate to the complexity and duration of the four-day trial.

Full indemnity costs were denied as the defendants' conduct during litigation did not meet the threshold for reprehensible behavior.

The court significantly reduced the claimed hours for various litigation stages and fixed the plaintiffs' costs at $191,500 plus HST for fees and $6,850.43 plus HST for disbursements, along with prejudgment interest.

This case involved a real estate commission dispute where the plaintiffs, Hurst Real Estate Service Inc. and DTZ Canada Inc., sought a 5% commission on the sale of a commercial property.

The court found that a binding contract was formed between the real estate agent, David Hurst, and the defendant Sam Sadr/Great Lands Corporation, entitling the plaintiffs to the commission.

The defendants' technical defenses, including the absence of a signed commission agreement and arguments under the Real Estate and Business Brokers Act, 2002, were rejected.

The court also found Sam Sadr personally liable for inducing the breach of contract and for being a party to the agreement.