COURT FILE NO.: CV-08-0567

DATE: 20120411

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

MICHAEL JOHN PICAVET

Plaintiff

– and –

ELIZABETH PEARL MARIE CLUTE, NICOLE MARIE STELLA and LORMEL DEVELOPMENTS (BRADFORD) LTD.

Defendants

R.B. Cohen, for the Plaintiff

K.J. Ralston, for the Defendants, Clute and Stella

HEARD: November 15, 16, 17, 18, 21, 22, 23, 24, 25, 28, 29, 30, December 2 and 12, 2011

HEALEY J.

OVERVIEW OF THE CLAIM

[1] In this action the plaintiff, Michael Picavet (“Michael”), sues to enforce what he claims was a verbal agreement concerning a parcel of land now located within the boundaries of the Town of Bradford West Gwillimbury. The defendants are Michael's mother, Elizabeth Clute (“Betty Lou”), and his sister, Nicole Stella (“Nicole”).

[2] The land around which this dispute arose is comprised of approximately 100 acres, legally described as Part Lot 14, Concession 8, in the Township of West Gwillimbury, County of Simcoe (“the 100 Acre Parcel). The components of this parcel were described throughout the proceeding as:

(i) the "Home Lands", being a two-story residence located on two acres of land municipally described as 2676 Concession 8, Bradford West Gwillimbury;

(ii) the "Subdivision Lands", consisting of 67.532 acres that had been zoned for residential development in the course of Ontario Municipal Board (“OMB”) proceedings from 2001 through 2002 and later sold in February, 2007 to Lormel Developments (Bradford) Ltd. ("Lormel");

(iii) the "Bradford Bypass Lands", being a swathe of land running in an east-west direction immediately to the north of the Subdivision Lands and which were ultimately expropriated by the Ontario Ministry of Transportation; and

(iv) the "Excess Lands", being a swathe of land running in an east-west direction immediately to the north of the Bradford Bypass Lands and extending up to the northern boundary of the 100 Acre Parcel.

[3] In summary, the oral agreement that Michael alleges was created between him and his mother was to result in Michael becoming the sole owner of the Homelands, the Excess Lands, the Bradford Bypass Lands, and would result in him having a significant interest in the profits from the Subdivision Lands.

[4] The specific relief requested by Michael is to have this court:

(i) declare that he is the owner of the Home Lands and the Excess Lands, and order that Betty Lou transfer those lands to him;

(ii) order that Michael is entitled to all of the compensation or other amounts to be received in connection with the expropriation of the Bradford Bypass Lands;

(iii) declare that Michael is entitled to an undivided 50.51% beneficial interest in a vendor take back mortgage granted to Lormel in the principal amount of $9,240,000 (the “Lormel VTB"), and order that the funds from the payout of the Lormel VTB currently held in trust be paid out to him, subject to an accounting.

ISSUES

[5] This action presents the following issues:

1. Whether there is an agreement between Betty Lou and Michael, and if so, what the terms of that agreement are;

2. If an agreement exists, whether the Statute of Frauds applies;

3. If the Statute of Frauds applies, whether a written memorandum exists that complies with the requirements of the Statute;

4. If the answer to the third issue is “no”, whether there are sufficient acts of part performance to take the agreement outside of the Statute;

5. Whether Michael is barred from obtaining equitable relief due to ‘unclean hands’;

6. Whether Betty Lou can rely on any other defences.

[6] There is also a counterclaim by Betty Lou in which she claims general, special, aggravated and punitive damages in the amount of $4,000,000.

DECISION

[7] For the reasons that follow, this court finds that no legally enforceable agreement exists between Michael and Betty Lou. The evidence as a whole is more consistent with the conclusion that money previously given to Michael by his mother was given by way of gift, as opposed to being made pursuant to a legally binding agreement. Although a variety of discussions occurred between Betty Lou and Michael in which Betty Lou told Michael that he would come to own various portions of the 100 Acre Parcel, and have an interest in the Lormel VTB, the evidence does not establish that a contract was ever formed between them. The evidence bears out that Betty Lou intended to make gifts to Michael and later revoked that intention, which does not form the basis of a cause of action at law.

[8] As a result there is no reason to answer questions 2-6 set out above.

THE LAW ON THE CREATION OF CONTRACTS

[9] The central issue in this case is whether there was ever a bargain struck between mother and son relating to the land in question. There is no written contract manifesting the alleged agreement; rather, it is a situation where the court must examine everything occurring between the two parties that is relevant to the alleged agreement in order to decide whether a contract exists.

[10] It is trite law to say that the absence of assent to an agreement prevents the creation of a legally enforceable contract. Far more complicated is the countervailing question: How does the court satisfy itself that both parties intended to bring an agreement into existence, an agreement containing the terms sought to be enforced? In The Law of Contract in Canada, 5^th ed. (Toronto: Carswell, 2006), at p. 15, Professor G.H.L. Fridman describes the approach as follows:

Constantly reiterated in the judgments is the idea that the test of agreement for legal purposes is whether parties have indicated to the outside world, in the form of the objective reasonable bystander, their intention to contract and the terms of such contract.[^1] The law is not concerned with the parties' intentions but with their manifested intentions.[^2] It is not what an individual party believed or understood was the meaning of what the other party said or did that is the criterion of agreement; it is whether a reasonable man in the situation of that party would have believed and understood that the other party was consenting to the identical terms.[^3] As Fraser C.J.A. said in Ron Ghitter Property Consultants Ltd. v. Beaver Lumber Co.:[^4]

the parties will be found to have reached a meeting of the minds, in other words be ad idem, where it is clear to the objective reasonable bystander, in light of all the material facts, that the parties intended to contract and the essential terms of that contract can be determined with a reasonable degree of certainty.

[11] As explained in the preceding passage from Professor Fridman’s text, to be considered along with the fundamental question of whether mother and son intended to contract is the question of whether they evinced clear agreement on the essential terms of the intended contract. A contract will not exist if it lacks the requisite certainty and clarity. Again this is an easy principle to iterate, but the harder task is to determine the point at which uncertainty or lack of clarity reaches the threshold at which a court must conclude that no contract was ever in effect.

[12] The test for certainty of contractual terms is whether the term or terms in question relate to essential aspects of the alleged contract: Bawitko Invts. Ltd. v. Kernels Popcorn Ltd. (1991), 1991 CanLII 2734 (ON CA), 79 D.L.R. (4th) 97 (Ont. C.A.) (“Bawitko”). The Court of Appeal in Bawitko reinforced the principle that no contract exists if the essential provisions that were intended to govern the contractual relationship have not been settled or agreed upon, or the contract is too general or uncertain: see also UBS Securities Canada Inc. v. Sands Brothers Canada Ltd., 2009 ONCA 328. In The Law of Contract in Canada, supra, at pp. 21-22, Professor Fridman writes:

For the most part, where terms are missing[^5] or have not been finalized,[^6] or there is some ambiguity about the precise meaning of what the parties appear to have agreed to,[^7] the general tenor of the decisions is against any possibility of completing the parties' work for them and creating a valid contract out of vague contractual intent that may be evidenced by their language or conduct.[^8]

[13] The principle that the court cannot make a contract for the parties if they have not agreed upon its material terms is a long-standing one: Kelly v. Watson (1921), 1921 CanLII 23 (SCC), 61 S.C.R. 482.

OVERVIEW OF THE FACTS

The parties

[14] Betty Lou Clute has three children in this birth order: Monique, born in 1969, Michael born in 1970, and Nicole, born in 1971. Betty Lou became the sole owner of the 100 Acre Parcel at the time of her divorce from the children’s father, Fred Picavet, in 1985. After the divorce, Betty Lou went back to school and became a registered nursing assistant and obtained work at the York County Hospital. It was there that she met her current husband, Bill Clute, who had been hospitalized following a serious car accident.

[15] Betty Lou's relationship with her children has, to differing degrees, been intermittently strained or virtually non-existent. Monique moved away from the Home Lands in approximately 1987 as a result of her mother's disapproval of her then boyfriend, and now husband, Hayden Pretty. They were estranged for approximately 14 years, beginning to communicate again in approximately 2001 at the urging of Nicole.

[16] Michael also left the Home Lands in 1987, at Betty Lou's request, after an altercation that arose when Michael returned home after a night of drinking with his friends. For a period of five years thereafter the relationship was, as stated by him, “kind of sketchy”, and it was his testimony that his mother wanted nothing to do with him during those years. He was not invited to Betty Lou’s wedding in 1990. Michael's relationship with Betty Lou was temporarily salvaged in 1992; at that time he was in a relationship with his now ex-wife, Kim Payou, and they were expecting Betty Lou's first grandchild. During that pregnancy, the couple moved into a basement apartment in the Home Lands, where they resided for close to a year while renovating a farmhouse. Six years later, in 1998, another altercation occurred. Its effect was that, in Michael's words, “we didn't have a relationship anymore. It was just nonexistent”. They remained estranged until 2001; this was the year in which the alleged agreement was struck.

[17] As for Nicole, she and her mother enjoyed a very close relationship throughout her lifetime up until January 2004, for reasons described hereafter. Nicole lived with her mother following her graduation from university and even after her marriage. Following her marriage to Tony Stella in 1996, the couple lived in the basement apartment on the Home Lands. In July 1998 they moved into their newly built house located on a piece of land severed by her mother at the time of Nicole’s marriage. The rift that developed between Nicole and her mother in 2004 continued until sometime after the sale of the Subdivision Lands to Lormel in 2007.

[18] The three siblings likewise have had tumultuous relationships. In particular, during her testimony Nicole made clear that she does not trust Michael and has generally avoided his company.

[19] Betty Lou married Bill Clute in 1990. Betty Lou had befriended Bill during his hospitalization and invited him to live with her after learning that he was to be transferred to a facility in Toronto. She made the Home Lands wheelchair accessible, and Bill came to live there in December 1988. Bill's accident had resulted in a coma and serious neurological injuries, and Betty Lou devoted herself to Bill’s rehabilitation: she had the driveway paved to facilitate his use of a walker, purchased a universal gym, took $125,000 out of line of credit to complete the indoor pool for his physical therapy , and took him to chiropractic, acupuncture and physiotherapy appointments. In April 1989, Bill received his motor vehicle accident settlement. Betty Lou testified that under a structured settlement he initially received $3,000 per month, increasing by 3% annually, and every five years receives a lump sum of $100,000. These benefits cease after 30 years, which will end in 2019. Betty Lou continued to work her night shift at the hospital until retiring in 1992.

[20] Michael graduated from high school in 1989 and then enrolled in a civil survey course at Georgian College, which he quit after the first semester. There was then a hiatus in his education, during which time he worked seasonally in his father’s land development company operating heavy equipment. He then attended Centennial College in 1995 or 1996 to study aircraft maintenance. Although he testified that this was a positive educational experience with good job prospects upon graduation, Michael did not complete that course; he testified that his father was having health issues, so he did not return for the second year in order to assist in his father’s business. In 2005, he enrolled in a property administration diploma course at Seneca College, taking courses such as mortgage underwriting, real estate law, and real property assessment. He was two credits short of graduating but received a designation from the Association of Independent Municipal Assessors. One of the courses in which he did not receive a passing grade was entitled ‘Planning and Urban Development’.

[21] In July 2001 Michael was diagnosed with a pulmonary embolism thought to be caused by spending long hours operating heavy equipment. In the previous year his total income was $32,190, comprised of employment income of $18,585 and employment insurance benefits of $13,605. Between 2001 and 2006 he received loss of earning benefits through the Workplace Safety & Insurance Board, which also paid for his retraining in the Seneca College property administration program.

Historical Dealings with the Land

[22] In 1996 Betty Lou decided that she was going to give all three of her children at 10% interest in the 100 Acre Parcel. Monique declined to accept such a gift, but transfers were registered in that year granting Michael and Nicole each a 10% interest in the 100 Acre Parcel. In 1998 Michael’s 10% interest was transferred back to his mother because he was going through a divorce. Betty Lou agreed at trial that, despite that transfer, it was her intention to hold Michael's 10% interest in trust for him, even when they were later estranged.

[23] Michael testified that, in that same time period it was commonly known that Betty Lou would not sell the land for less than $5 million, but that all that she wanted to receive from any sale was $1 million. His understanding was that he and Nicole would also each receive $1 million, and the rest would be expended in capital gains tax.

[24] Betty Lou would have been aware of the value of the 100 Acre Parcel from as early as 1989. In that year she received an offer to purchase for $3,760,000. Ten years later, Betty Lou and Nicole received an offer in the amount of $4,750,000. That offer was accepted but the sale was not completed, resulting in a mutual release signed in July 2000. Two things are notable from this fact: the first is that it was obviously not Betty Lou's intention, at least as of 1999, to retain the land for Michael to develop; second, with respect to the proposition that Betty Lou had always maintained that she wanted only $1 million from the sale, on his own evidence Michael had no relationship with his mother in 1999 and, therefore, cannot reliably speak of her intentions in relation to that offer.

[25] The expansion of the urban boundaries of the Town of Bradford began in 1995 as part of the revision of the Town's official plan, following an amalgamation of three townships in 1991 which resulted in the Town of Bradford West Gwillimbury (the "Town").

[26] Michael testified that it had always been his dream to develop the property. He testified that “because my Dad was out of the picture, it was an open door for me to move into it”. To that end, in 1996, Michael applied for an official plan amendment with the assistance of a local planner. The purpose of the application was to change the official plan designation and zoning for the 100 Acre Parcel from rural to residential to permit development of a residential plan of subdivision.

[27] The Town's Official Plan became the subject of an Ontario Municipal Board hearing as a result of various appeals commenced by interested landowners from within Area 4 and other areas. Betty Lou was not one of the appellants. At the Board’s first pre-hearing conference held on May 4, 2001, Betty Lou is listed as being in attendance as an unrepresented party. She attended the next two pre-hearing conferences held in June and August of 2001 but was represented by counsel, David White. It is clear from the decisions of the Board arising from those hearings that the issues were narrowed and an issues list was created for the main hearing scheduled to begin on November 15, 2001. Significantly, following the August 23 hearing, a decision was made by the Board that permitted the consolidation of one landowner’s appeal with a consideration of a secondary plan prepared by that same landowner, Angelo Orsi, owner of Charter Construction Limited (“Charter”). It is noted in this decision that the Clute property did not have specific applications for subdivision or by-law amendment, but that Mr. White on Betty Lou’s behalf was supportive of the motion to consolidate because the 100 Acre Parcel was within the Secondary Plan proposed by Charter. Ultimately the Board made the decision, which was of benefit to Betty Lou, to consolidate related zoning by-law amendments and subdivision applications by Charter following the main hearing of the Town’s Official Plan.

[28] Subsequently, on September 12, 2001, Mr. White asked to be removed as counsel of record for Betty Lou Clute. As will be explained in detail later in these reasons, Michael began to appear as Betty Lou’s agent following the September 12 hearing. On October 17, 2001, a motion was heard by the Board whereby the Town sought to have the party status of certain individuals or entities changed to participant status, to reflect their intended level of participation in the proceeding. Michael successfully opposed that motion before the Board, and Betty Lou’s party status was preserved.

[29] For approximately five and a half years, spanning from October 2001 to February 2007, it is alleged by Michael that he was integrally involved in attempting to facilitate a proposed subdivision plan for the Subdivision Lands. It was his evidence throughout the trial that his efforts were to maximize the value of the 100 Acre Parcel and to protect what he referred to as his investment. During this period the Town introduced a developers prepayment agreement (the “DPA"), in which all developers were being asked to pre-pay for sewer and water allocation. Michael alleged that, as a result of this prohibitively expensive DPA, he was forced to end his development efforts and turned his attention to facilitating the sale of the Subdivision Lands to a third party developer. Betty Lou acknowledged that during that period Michael worked hard to facilitate a proposed plan of subdivision on the Subdivision Lands and then later to negotiate a sale to Lormel.

Structure of the Sale to Lormel Developments

[30] The Subdivision Lands were sold to Lormel on February 12, 2007, for the sum of $13.2 million, with the Lormel VTB in the amount of $9,240,000.

[31] However, because the Subdivision Lands had not yet received severance approval by the time of sale, it was necessary to convey the entire 100 Acre Parcel to Lormel. This was achieved on February 12, 2007, by Nicole and Betty Lou transferring both the Home Lands and the Excess Lands to Lormel, who gave a second vendor take back mortgage to Betty Lou in the amount of $7 million, with the agreement that those parcels would be re-conveyed to Betty Lou after severance approval was obtained. Ultimately the parcels were re-conveyed to Betty Lou - the Home Lands in May 2008 and the Excess Lands in June 2010 - and the $7 million mortgage discharged.

[32] The Bradford Bypass Lands were also conveyed to Lormel under security of the $7 million mortgage at the time of sale. Lormel subsequently conveyed that parcel to the Province in order for compensation arrangements to be undertaken by the Ministry of Transportation. Once determined, such compensation is to be paid to Betty Lou.

[33] Following her conveyance to Lormel, Nicole never again had an interest in the 100 Acre Parcel other than to the extent of her 10% interest in the Lormel VTB.

[34] By the time of trial, the Lormel VTB had been paid in full, and the proceeds held in trust pending the resolution of this action.

THE EVIDENCE OF AN AGREEMENT

The Testimony of Michael and Betty Lou

[35] The disparity between Betty Lou’s and Michael’s version of events starts right from the outset.

[36] Betty Lou testified that in the summer of 2001, following Michael’s hospitalization from his embolism, she received a call from his then girlfriend to inform her that Michael was unwilling to “get up off the couch”. In order to try to motivate him, Betty Lou invited Michael to go with her to the next OMB hearing on August 23^rd. The documentary evidence shows that that was the second of the three pre-hearings that were convened. It was her evidence that he simply came to those pre-hearing meetings with his laptop for note-taking. There were no other arrangements; he was just to attend with her. Betty Lou also explained that David White was her lawyer at the outset for three or four months, but that their relationship ended when she said that she thought that she could only pay him $25,000 to represent her throughout the hearings. The OMB documents show that he was removed as her solicitor of record on September 12, 2001.

[37] In contrast, Michael testified that he went to the August 23^rd meeting at the urging of his father, who was also involved due to his own separate land holdings. It was Michael’s evidence that he thought that Mr. White was concurring too much with other counsel, and he was concerned that his mother was not receiving adequate representation. It was also his evidence that he understood from comments made at that meeting that Mr. White was no longer going to be representing Betty Lou, and that he questioned his mother regarding these concerns but received inadequate answers. The Board decision from that August 23 attendance makes note of the supportive position taken by Mr. White with respect to including the Clute lands as part of the consolidated hearing but does not refer to any discussion of Mr. White’s impending request to be removed as counsel. Michael’s evidence is that he returned to the next meeting on September 12, but not accompanying his mother. He indicated that, after hearing that Mr. White would be removed as solicitor of record on that date, he was concerned that his mother would not have party status anymore and would be reduced to participant status because she did not have counsel. He once again approached his mother and questioned her as to her intentions, and at that point she invited him back to the Home Lands to discuss the matter.

[38] According to Michael, the initial agreement was made during discussions between Michael, Betty Lou and Bill in the library at the Home Lands on September 12 and October 17. Conceptually, the agreement according to Michael was that he would step in and represent Betty Lou at the OMB hearings and, in his words, “represent the ‘land’ and fight everybody off”. In return he was to receive whatever profits were to be made through either subdividing or developing the land, after Betty Lou received one million dollars out of the land, and Nicole received at least one million or her 10 percent. The entirety of his testimony surrounding the creation and terms of the agreement is as follows[^9]:

Q: And where do you get this information from?

A: From the conversation we had in the library between myself, Bill and my mom.

Q: Okay.

A: So apparently Petch[^10] turned her down, as well. So she had no other choice but to just drop down and drop David White as her lawyer. So it was kind of, more or less we started talking about, well, you know, there has to be something we can do, you know, to be able to stay on as a party. So we just started stewing with ideas as far as what we could do, the fact that maybe I could go in there and represent the property, that came up, and we started talking about and working on, pretty much working on the agreement that if it ends up, if I can get on as agent for the land and represent the land and fight everybody off that's trying to push different commercial, industrial commercial and stuff on there, then right back to the same thing that she's always wanted, was just a million dollars out of the land, Nicole was to get at least a million, if not, her ten percent, and whatever I could get over and above that through either subdividing it or you know, developing it myself, or whatever, is mine. And the main thing she stressed was that I could not affect the property where they could potentially lose the house and lose the property.

Q: Okay, so what did you understand you had to do to get what you've just described for us?

A: I had to be able to become agent for the property. I had to be able to get on as agent and move forward with doing the OMB hearing and taking care of the property, the interest in the property.

[39] As will be discussed in detail later, Michael testified that the impetus for this entire discussion arose from the threat of having Betty Lou’s status changed due to having no legal representation.

[40] On October 17, Michael successfully opposed a motion by the Town to request that the Board change Betty Lou’s status from party to participant. Directly after the hearing on October 17, Michael testified that he again went to his mother’s home to discuss the alleged deal. His evidence regarding the discussion on that date was as follows[^11]:

Q: All right, can you tell the court what you discussed with your mother at that time?

A: That pretty much finalized the deal that we made, that here I got on as agent, now I'm fighting for the property, so it finalized the agreement we had where all she wanted was one million dollars out of the property. Nicole had to get her million dollars out or ten percent, like at least $1 million, and I got to run with the ball, as she put it. She said, and that's her words, and I thought, okay, that sounds kind of good, run with the ball. So then through that I wasn't supposed to make the property in a position where we could lose it or something, but anything over and above what she wanted and what Nicole was entitled to was mine, as long as I kept on going to the OMB and kept running with the ball.

[41] Taken together, these two discussions occurring on September 12 and October 17 are what Michael proffered to constitute the creation of the agreement, which was referred to throughout the trial as the "Initial Agreement".

[42] By contrast, Betty Lou was asked to comment on Michael's evidence about the Initial Agreement, and her sole response was "there was no agreement".

[43] Michael then testified that approximately one month later there was some discussion about modifying the agreement. His evidence was[^12]:

A: The first thing that came up was she threw in that she wanted to move out of the house and she wanted a bungalow built for her, for her and Bill.

Q: All right, so let me stop you. How long after the October 17 discussion did that discussion about the bungalow come up?

A: I think it was around a month later, something like that, and just, there was always different ideas toying around but that was something that she really wanted.

Q: So what did she say?

A: She said she wanted to add that to things, where I'd get the house, as long as I built a wheelchair accessible bungalow for her and Bill.

Q: Do you remember where you had that conversation?

A: In the library. Most of our conversations happened in the library. Some, you know, just working through ideas, maybe sitting watching TV in the family room, but mainly in the library.

Q: And what was your response to her request in that respect?

A: It was something that I liked the idea because it’s a family house that I've always loved, it's always felt like home, so I was yeah, okay, and then I wanted them to be close. So we were toying with the idea of when I develop, backing them right onto the house, so that they are right next to the grandkids and they're still part of our lives and that.

[44] More amendments followed, according to Michael. The next significant amendment was with respect to the amount of money that Betty Lou would receive. Michael testified that the amount of money his mother wanted from the alleged deal increased from $1 million to $3 million[^13]:

Q: Okay, tell me about the discussion you had with your mother.

A: My mother requested more money from the whole deal.

Q: Okay, when did that take place? Just roughly.

A: Exactly. Roughly. I'm just trying to think out loud. Right after the - I could fine tune that a little bit more because it would be very roughly if I said…

Q: Okay, can you tell us the nature of the conversation.

A: The nature of the conversation, we had somebody come in that was trying to get us to do a joint venture and my mother –

Q. Who was that?

A. Tom Tsampiras, he was coming in and trying to give us some deal on, he had a group of investors wanting to help develop the property and he was trying to sell it to us as an offer to purchase, but in fact, it actually turned into more of a joint venture, which we didn't want any part of.

Q. Okay, so you had a conversation with Tom Tsampiras.

A. On many occasions.

Q. Okay.

A: From that my mother hearing those numbers and myself hearing those numbers, my mother was realizing and I was realizing that the property values were going up, so she had requested that she wanted more money, that she wanted to take a million dollars and share it with her siblings to help them out in life. She wanted to have an extra million for Bill because - and I agreed to both because Bill had paid for a lot of the stuff that we had to do for the land and he actually had kept the land. If it wasn't for his annuity coming in, we would have lost the whole package years back.

[45] Michael testified that his mother then wanted to change the deal to include not just the $3 million that she was getting for herself and Bill but also $1 million for Monique for a total of $4 million. On cross-examination, however, Michael referenced, for the first time, an increase to $2 million[^14]:

Q: [P]lease listen to my question. There were multiple changes to that initial agreement before we get to the one in your evidence that you're trying to pursue in this action, correct?

A: There was her going to with the house, going up to $2 million, and then the next thing I know it was another million for Bill and then finally the other million for Monique, and that was what I agreed on, I said, okay, cool, that's fair.

[46] As referenced in his testimony, a third area of change was in respect of his sister Monique, who had begun to re-connect with their mother in approximately 2001. Michael testified that Monique began to bring her children around to see Betty Lou and alleges that Betty Lou then suggested that she wanted Monique to have a million dollars, after taxes, from the sale. While his evidence on this is unclear, he suggests that this change replaced an earlier obligation on him to look after Monique if “she ever fell on hard times”. He stated[^15]:

A: At this time the - my mother wanted the deal to change prior to this, obviously, change to not just the three million dollars that she was getting for herself and Bill but also instead of just having so I had to take care of Monique if she ever fell on hard times that she wanted me [sic] to have a million dollars at this point.

[47] The timing of this conversation was not clear in the evidence.

[48] In or around May 2005, Betty Lou allegedly changed her mind about wanting a wheelchair accessible bungalow and indicated that she and Bill would prefer to move into a condominium in Barrie. It was not clarified in Michael’s evidence how this would affect that part of the agreement that gave him the Home Lands.

[49] Two additional essential terms of the alleged agreement later came to light during Michael's testimony. The first was that, shortly after he and his mother had made the Initial Agreement, they agreed that it should be kept a secret from Nicole, despite the fact that Nicole had an ownership interest in the property. On cross-examination he confirmed that this was not part of the Initial Agreement, instead testifying[^16]:

A: I don't think we talked about that until once Nicole and her started being on the outs, that it was something that we knew was going to irritate her so, and it wasn't until the property really started increasing in value and that, that we realized, wow, this is really kind of changing, so it's something we can't really discuss with her because once we went to approvals for different things and she started being difficult, we knew that she'd end up being difficult with finding out, more difficult if she found out what our deal was.

[50] The other alleged term of the Initial Agreement was that the benefits received by Michael through this agreement were to be characterized as a gift and that, from the time of the striking of the Initial Agreement, Betty Lou was holding the 100 Acre Parcel in trust for Michael, to be transferred or paid out, as the case may be, in accordance with the terms of their alleged agreement as modified over time.

[51] Betty Lou’s evidence was that she agreed to have Michael act as her agent throughout the OMB process, and was aware that he was trying his hand at development. She agreed to have him negotiate the sale of the Subdivision Lands. Her evidence suggested that she felt that she had been very generous to Michael both generally and in her division of the proceeds of the Lormel downpayment. She was adamant that there was never any agreement concerning any of the land in question.

The Wills

[52] The court heard evidence of two wills made by Betty Lou during the relevant period. The first was prepared and executed on April 27, 2007 (the “first will”). The impetus for the creation of the first will was that, after the closing of the Lormel sale, Betty Lou, Bill, and Michael, together with Michael’s girlfriend and his children, were leaving to go on an intercoastal waterway cruise in Florida. Betty Lou wanted to get her affairs in order.

[53] In the first will Betty Lou appoints Michael as the executor and makes specific bequests that Michael argues are reflective of their agreement. The relevant provisions of the first will are as follows:

(c) Gift to WILLIAM ROBERT DOUGLAS CLUTE

If I should predecease my husband, WILLIAM ROBERT DOUGLAS CLUTE, I direct my Trustee to purchase a wheelchair accessible residence for my husband, WILLIAM ROBERTS DOUGLAS CLUTE, for his own use absolutely if WILLIAM ROBERT DOUGLAS CLUTE lives for at least 30 days after I die.

(d) Gift to MICHAEL JOHN PICAVET

Upon the purchase of a wheelchair accessible residence being completed for my husband, WILLIAM ROBERT DOUGLAS CLUTE, I direct my Trustee to transfer my house and property located at 2676 8th Concession, Bradford West Gwillimbury, to my son, MICHAEL JOHN PICAVET, if MICHAEL JOHN PICAVET lives for at least 30 days after I die.

I direct my Trustee to transfer any remaining lots located in the subdivision on Lot 14, Concession 8, to MICHAEL JOHN PICAVET, so long as he lives for at least 30 days after I die. My intention is that the balance of lots be dealt with as per our agreement.

[54] The trustee is then directed to divide the residue of the estate in equal shares and to deliver those shares to Betty Lou's children equally.

[55] Betty Lou prepared another will on December 2, 2007 (the “second will”). This is a handwritten will that was made in response to having a falling out with Michael. It was a simple one-page handwritten will, the contents of which was as follows:

I Elizabeth Perl Clute revoke all other wills to date.

I leave everything farm sale, house plus 2 acres, excess lands, & contents of house, cars, R.S.P. investments and bank accounts + (monies rolled), to my husband William Robert Douglas Clute who will follow my wishes as discussed with Will lawyer George L. Craig on Nov. 21/07 at 11 A.M. If he does not survive me, I leave everything to Monique Jeanette Pretty in trust also to follow me (sic) wishes as discussed with George L. Craig (lawyer).

The Spreadsheets and the Disposition of the Proceeds

[56] The court heard evidence of various spreadsheets prepared by Michael during the course of his involvement with the 100 Acre Parcel. The first one presented to the court was prepared during a period when he still hoped to develop the Subdivision Lands.[^17] He was unsure of the timing of its preparation but indicated that it probably would have been in 2004 or 2005. He described it as being comprised of rough numbers that he was “throwing together” to see approximately what the outcome of developing the first phase of the land would be and what his share would be at the end of the day. It is clear from the face of the document that the numbers were speculative. However, the document contains two noteworthy items. The first is that, out of an estimated $9,720,000 profit, Michael shows himself as receiving $6,720,000. The second is that it shows his mother’s share to be $3 million. He testified that by that time, his mother had changed her position from wanting $1 million to only wanting $3 million because the value of the land was increasing. As earlier explained, Michael’s evidence is that, at some point prior to preparing this document but at a time that he was not able to identify, Betty Lou wanted an extra $1 million to share with her own siblings and a further extra $1 million to give to Bill.

[57] The second spreadsheet is entitled “Property Money Breakdown”, which Michael testified that he prepared in the fall of 2004 when he was “shopping offers” for the property. Based on an estimated net profit from the sale of $11.5 million, this document shows a distribution of $1,150,000 to Nicole, $3 million to Betty Lou, $1 million to Monique and $3,969,500 to Michael. This document also shows an amount of $2 million identified as “property investment”, which Michael explained was an amount that he hoped to use to purchase land located to the north of the Excess Lands, for the purpose of later development.

[58] It was Michael’s evidence that, as various offers were made to purchase the property beginning in 2006, he developed an Excel spreadsheet in which he inserted various amounts depending on the terms of the offer. It was his evidence that he reviewed some, but not necessarily all, of these iterations with Betty Lou and Bill by showing the spreadsheets to them on the computer located in the library in the Home Lands.

[59] The final version of the spreadsheet was created when the final offer was received from Lormel. It came to be referred to during the trial as the “Tab 467 spreadsheet”. [^18] This version shows a net of tax profit of $10,130,000 based on the sale price of $13.2 million, with a distribution of $4 million to Betty Lou, $1,013,000 for Nicole, and $5,117,000 for Michael. The result was a proportionate distribution of 10% for Nicole, 39.49% for Betty Lou, and 50.51% for Michael. The Tab 467 spreadsheet also contained a schedule of payments, including the initial payment due from Lormel under the agreement in the sum of $3,960,000. After payment of taxes in the amount of $614,000, the anticipated balance would be $3,346,000. This amount was shown on the tab 467 spreadsheet to be distributed according to the percentage interest: $1,690,175.91 for Michael, $1,321,224.09 to Betty Lou and $334,600 to Nicole.

[60] It was Michael's evidence that he prepared the Tab 467 spreadsheet in the library at the Home Lands. He also said that he reviewed it with both Betty Lou and Bill because he had to make sure that everyone “was happy” before the deal was finalized. His specific evidence was[^19]:

Q. So did you review the contents of this spreadsheet with Bill and your mother?

A. Yes, I did.

Q. And what was their reaction, if any, to this document?

A. We were happy that, well, everybody was happy that we were getting that amount. It did have to come down a bit, but I explained that to them.

[61] Betty Lou denied seeing any spreadsheets prior to the closing of the Lormel transaction.

[62] Betty Lou and Nicole were represented by solicitor John Mitchell for the closing of the sale transaction, but it was Michael who had all contact with Mr. Mitchell up until it was time for the closing documentation to be signed on February 8, 2007. Upon the closing of the sale on February 12, 2007, Betty Lou received two cheques, one in the amount of $614,000 and the other for close to $3 million. Michael testified that he and Betty Lou went to a Bank of Nova Scotia branch in Barrie and deposited the $614,000 into a tax account, while the $3 million cheque was deposited into Betty Lou's account. Betty Lou then provided Michael with a cheque in the amount of $1,695,283.03. It was Michael's evidence that there were a few adjustments on closing that account for the minor variation from the amount shown on the Tab 467 spreadsheet that he was to have received. Nicole received her own cheque on closing in the amount of $332,809.23.

[63] Betty Lou testified that she gave Monique $300,000 from her share of the closing proceeds. She confirmed that it was her intention that Michael receive 10% of the $13 million and an additional $400,000 to pay for the house that he was living in, which was owned by his father. She testified that this was “because he no longer wanted the Home Lands”. It was Betty Lou’s testimony that he was given the additional $400,000 to purchase the house from his father, and it was her understanding that that was initially what he was going to do with the $400,000. She asked him a couple of times how much he owed his father, but ultimately she testified that she did not care what he did with the additional money.

Evidence of Other Witnesses

[64] The plaintiff called three additional witnesses to provide evidence of the alleged agreement.

[65] One witness was Neil Stratton, an investment advisor for Scotia McLeod. Mr. Stratton met with Michael, Betty Lou, and Bill at the Home Lands when the closing of the sale was approaching. Betty Lou was present during the entire meeting, which lasted about an hour and a half. He recalled that Michael did the majority of the talking, with Betty Lou contributing, but to a lesser extent than Michael. He did not sense any disagreement or dispute between them, and there was nothing material that he could remember in Betty Lou's reaction to the numbers that they were discussing during that meeting. He recalled that they talked a bit about what Betty Lou planned to do with the money she was to receive, which included a cruise for her and Bill and the purchase of a condominium in Barrie.

[66] Mr. Stratton took notes during the meeting.[^20] He testified that they discussed the fact that there was going to be a lump sum received from the sale of the land, that there were tax implications they would be facing, and that they were contemplating how to invest the amounts that would be received. He was aware that they were expecting to receive some of the proceeds over time through a vendor take back mortgage. His notes indicate that there was to be a total of $13.2 million received, with an anticipated $10 million after tax. He noted “8 million to invest”, and when asked how that was to be divided he testified that he presumed that it was between the two of them, referring to Michael and Betty Lou. He was unable to explain what was to occur with the difference of $2 million. Overall he was left with the impression that Michael was getting a “really good healthy portion” of the vendor take back mortgage when it was paid out, but that his sisters were not.

[67] As for the initial amount to be received on closing, Mr. Stratton noted that there was to be a down payment of $3 million, which later in his notes he referred to as $2.7 million. He recalled that Betty Lou and Michael were sharing the initial amount. His notes refer to $1 million to “be in Betty Lou’s name, and $1.6 million in Michael’s name”, with $614,000 being paid in taxes. He recalled that Betty Lou would be paying the taxes. With respect to this initial sum, Mr. Stratton’s notes indicate that Michael wanted to keep one-half accessible and that he was buying a 50 foot fishing boat worth $500,000. With respect to Betty Lou’s $1 million, he noted that she wanted 50% to be earmarked for long term investment and 50% to be accessible as she wanted to give some to her own siblings and was planning to spend $160,000 on a world cruise. He also recalled that one of Michael’s sisters was getting some amount from the sale and another was getting almost nothing.

[68] There are various other numerical formulae and notations in the notes but Mr. Stratton was unable to recall their significance. While he agreed under cross-examination that the focus of the meeting was on the initial down payment, and that his notes only related to that down payment, it is clear that there is a reference at the beginning of the notes to the full $13.2 million and the tax implications, albeit with little clarity around how the full amount was to be divided.

[69] Also called to give evidence for the plaintiff was Charlene Calendar, who was a close friend of Betty Lou’s between 1992 to 2007 when they talked on the phone two or three times each day and visited about once a month. She testified that from time to time they would discuss financial matters and that Betty Lou confided personal things in her. Mrs. Calendar also testified that Betty Lou told her that at the time of her divorce Michael refused to move from the Home Lands, and it was for that reason that Betty Lou retained the land. Mrs. Calendar said that Betty Lou expressed this sentiment on more than one occasion. With respect to the Home Lands, Betty Lou told her that Michael wanted to live in the family home and that she was going to give it to him because, had it not been for him refusing to move, she would not have decided to keep the 100 Acre Parcel. Betty Lou also told Mrs. Calendar that Michael was involved in the OMB hearings. Betty Lou that she was very proud of him and that it was also as a reward for the work he was doing that she was giving him the Home Lands.

[70] Another witness to testify for the plaintiff was Michelle Ertl, Michael’s former girlfriend. She testified that she met Michael in August or September 2003 and dated him for four years. During that time she saw Betty Lou and Bill almost weekly. When she first began dating Michael, she became aware that he had plans for a subdivision. She testified that Betty Lou told her that Michael had represented them at the OMB and that she was very proud of what he had done.

[71] Ms. Ertl also testified that it was her understanding that after the sale to Lormel Michael was to get the rest of the lands. Her understanding from her discussions with Betty Lou was that the Bradford Bypass Land was something that Michael “would pursue” and that he would also receive the Excess Lands. They also talked about the Home Lands, and it was apparent to her that Michael was going to be given the Home Lands and would be moving there. At one point, she was aware that Betty Lou took Michael’s children to show them what rooms they would have in the home. Betty Lou also told her about how she and Bill wanted to retain a couple of lots that backed on to the Home Lands in order to build a bungalow; at some point she was shown the plans for the bungalow. Ms. Ertl stated that all of this was discussed at every gathering at the Home Lands. She knew that Michael had dreams of buying a boat with the money that he would be receiving from the sale, and he showed her pictures of the boat that he eventually bought. She testified that Betty Lou encouraged the purchase.

[72] Before the sale occurred, her understanding was that Michael was going to get a larger portion from the Lormel sale and that he was going to receive the Bradford Bypass Lands, the Excess Lands and the Home Lands. Betty Lou explained to her that Michael was getting this because he deserved it for of all of the work that he did and because they would not be getting as much if it were not for Michael's work. Betty Lou also told her that Michael had convinced her to keep the property at the time of her divorce.

[73] Ms. Ertl testified that she was a part of discussions held throughout the four years during which Betty Lou said she only wanted $1 million because she did not need much more than that amount to live on, given that Bill had money coming in, and Michael was doing so much work. She became aware later on that Betty Lou had indicated that she wanted more money for her brothers and sisters.

[74] Ms. Ertl observed that Michael would do work in the library at the Home Lands. It was there that she saw a spreadsheet that Michael was working on at the time of the deal with Lormel. She described it as “a division of who would get what and it listed Michael’s share and Betty Lou's and Bill’s and Nicole's 10%”. She recalled looking at the spreadsheet before the sale to Lormel when Michael had it up on the computer screen, and she and Bill and Betty Lou were looking at it.

[75] She recalled that around the time of the closing of the sale Betty Lou spoke of her desire to give Monique some money, whereas there had been no mention of this in the years leading up to the sale.

[76] Finally, Ms. Ertl testified that she accompanied Michael, his two older children, Betty Lou and Bill to Florida to cruise on Michael’s boat after the Lormel closing. Her evidence was that the trip was supposed to be a celebration of Michael’s hard work and, according to Betty Lou’s comments on a few occasions, was Michael’s ‘retirement cruise”. She recalled Betty Lou and Bill toasting Michael at one of the restaurants during the cruise, welcoming him to his “early retirement” [^21].

The Initiation of this Lawsuit

[77] Betty Lou and Michael also have very divergent stories about the breakdown of their relationship. It was Betty Lou's evidence that around December 3 or 5, 2007, she received a note from Michael telling her that she should sign over "everything" to him. She stated that a second letter came around December 17, and that this second letter included the Tab 467 spreadsheet. This upset her greatly, as the spreadsheet indicated to her for the first time that Michael wanted to receive 51% of the proceeds of sale.

[78] At her examination for discovery, Betty Lou testified that the first time that she saw the Tab 467 spreadsheet was in February 2007 when she retrieved it from a brown envelope in her safe at the Home Lands, the envelope having previously been given to her by Michael. Her evidence at her discovery was that at that time he had not discussed with her that he thought they had a deal. According to Betty Lou, this revelation of the spreadsheet occurred for the first time after the Lormel deal had closed in February. Under cross-examination at trial, she indicated that she had been mistaken and had seen the spreadsheet for the first time in December when it was enclosed in the second letter.

[79] Betty Lou was equivocal in her testimony as to when she stopped speaking to Michael; she indicated that she stopped speaking to him when she received these letters but thought that perhaps she was annoyed with him prior to then, for reasons that she did not explain. In January 2008 she left on a boat cruise and has not spoken with Michael since then.

[80] Mrs. Calendar attributed the falling out to a time when Betty Lou told her that a Town councillor had shown her a draft subdivision plan that indicated a plan for development on the Home Lands. Mrs. Calendar said that Betty Lou was angered by the fact that Michael wanted to develop the Home Lands.

[81] According to Michael, a strain developed in the relationship following the April 2007 boat cruise in Florida. Michael testified that there was an "altercation" on the cruise and that Betty Lou and Bill left the cruise early. Michael testified that Betty Lou seemed to be irritated with him thereafter and that she told Michael, in the fall of 2007, that he would not be receiving any more money from the Lormel transaction. This lawsuit ensued.

ANALYSIS

Intention to create legal relations

[82] While acknowledging that there are facts that are very difficult to reconcile in this case, and that it has not been a straightforward conclusion to reach, this court finds that there is insufficient evidence to establish an intention to create a contract between Michael and Betty Lou.

[83] The Initial Agreement was alleged to have come into existence mere months after mother and son reconciled after not having spoken in three years. It is quite possible to conclude that, had it not been for Michael’s health problems, he and his mother may never have experienced any reconciliation given that they had had a prior period of estrangement that lasted approximately five years. While this court finds that Michael eventually earned his mother’s appreciation and approval in the years during which he worked on the Subdivision Lands, it is also clear from the evidence that he did not have it from the outset. This court heard evidence about an event occurring in approximately 1989 when Betty Lou sued Michael in Small Claims Court over a trailer that she believed that he had stolen from her. Her testimony was that she did not consider this as suing Michael but that she was trying to teach him a lesson about stealing from her. She added “I could never teach that boy anything”.

[84] Against this background, the court is urged to believe that Betty Lou made a bargain with Michael that would have him obtain ownership of the Bradford Bypass Lands, the Excess Lands, all interest in the Subdivision Lands over and above $1 million, or eventually $4 million and Nicole’s 10%, and would also give him the Home Lands. She would have to know, given the offers made for the property previously, that this would be a bargain of considerable value to Michael, one that would leave him in a preferable position to his sister Nicole, the daughter with whom she was exceedingly close at that time.

[85] It is to be remembered that Nicole was a tenant in common, holding a 10% interest in the entire 100 Acre Parcel. The agreement propounded by Michael would mean that Betty Lou chose to ignore this pivotal fact and that she offered Michael something that she was not in a position to offer without Nicole’s assent.

[86] Michael urged this court to conclude that Betty Lou was in a predicament in the fall of 2001 and was so indebted to him for coming to her aid by representing her at the OMB hearing that she made such a bargain. Michael’s evidence on this point is not believable, and regarding this event I find the evidence of Betty Lou to be more reliable. Michael was recovering from his embolism and was not working in August and September 2001. I find that Michael’s first attendance at the OMB hearing on August 23 was as a result of his mother’s invitation to accompany her. After Mr. White was removed as her counsel, it became useful to her for Michael to assist her as her agent, particularly given that he was more comfortable with public speaking than Betty Lou. Ultimately, however, I find that Betty Lou’s motivation was primarily to give her son something to do to occupy himself, as she testified.

[87] Further, I find as a fact that the meeting that occurred at the Home Lands on September 12 had nothing to do with an impending change in party status, for the following reasons:

• Michael testified that the impetus for this entire discussion arose from the threat of having Betty Lou’s status changed due to having no legal representation. Michael testified that this information came to him from a planner known to him through his father, by the name of Celeste Phillips. Although the plaintiff called an expert in OMB matters to give evidence in this proceeding, planner Michael Smith, Mr. Smith did not testify that a lack of legal representation would somehow trigger a change in status in OMB proceedings.

• The documentary evidence does not support Michael’s version of events. The OMB decision arising out of the September 12 hearing addresses the issue of some last-minute changes to the list of parties and participants, including the fact that Mr. White was being removed from the record. However, it makes no mention of a potential change in Betty Lou’s status. That decision in fact notes that the list of parties and participants was finalized as an attachment to the procedural order issued with the decision and, that matter having been finalized, the hearing was ready to proceed in November.

• Mr. Longo, solicitor for the Town of Bradford, was present at the September 12 meeting. The decision of the Board from that date makes no reference to Mr. Longo seeking to alter the status of various parties. On the other hand, at a separate appearance on September 26, Michael’s evidence is that he approached the Board’s chair to ask how he could go about becoming an agent for the property.

• It is only as of October 9, 2001, that documentary evidence exists regarding the motion by the Town to argue the change in status of various interested parties. On that date Michael sent an e-mail to Mr. Longo in which he indicated that he would be attending the October 17 motion date to oppose the Town’s motion. He also stated in that e-mail that he was committing himself to attending each and every hearing date regarding their case or the property.

[88] Accordingly, I find as a fact that the issue of the change in party status did not arise until sometime after September 12, 2001, and therefore could not have been the premise upon which the alleged agreement was built. Michael agreed to be actively involved as Betty Lou’s agent, and to attend every meeting, not because of an agreement, but because the opportunity presented itself and because being involved in developing the property had always been his dream. The dream of being a developer like his father, with its financial rewards, must have fuelled Michael’s interpretation of discussions occurring between him and his mother from September 2001 onward. I draw this conclusion because, ultimately, this court is at a loss as to how Michael could have ever interpreted the discussions, as he presented them to the court, as giving rise to a fully developed legal agreement.

[89] For Betty Lou to arrive at the decision, as of October 17, that she was going to give Michael literally millions of dollars for doing something that she was unwilling to pay $25,000 to a lawyer to accomplish, is simply unbelievable. While it is true that Mr. White was not going to develop the land, as was Michael’s intention, there is no evidence that as of October 17 Betty Lou expected that Michael would be able to so.

[90] Yet Michael applied himself for over five years to this goal, and based upon the evidence that I do accept, I conclude that Betty Lou made comments both to Michael and to others that lead to the conclusion that she did intend to reward him handsomely for his efforts, albeit not as a result of an enforceable obligation. What is unclear is the extent to which she intended to do so. Based upon the evidence that exists apart from the testimony of Michael and Betty Lou, I do accept that Betty Lou often expressed an intention to give Michael more than the money that he received at the time of the Lormel closing and that her trial evidence was tailored to backtrack from those comments. That being said, Betty Lou’s desire to paint a different picture for the court is still not enough to lead this court to the conclusion that a contract was created.

[91] First, I accept that discussions occurred in the presence of Ms. Ertl and Mrs. Calendar where Betty Lou expressed her intention to give Michael the Home Lands because she credited him for her decision to retain the lands at the time of her divorce and because of his work on the lands. I am not prepared to accept that a similarly clear intention was expressed with respect to the Bypass Lands and the Excess Lands; Ms. Ertl simply testified that it was her understanding that these lands would in the future create further work for him, but the details of ownership or compensation were not elaborated upon. Mrs. Calendar did not testify that she had been told that Michael was to receive the Bypass or Excess Lands. In terms of Betty Lou’s comments that she wanted only $1 million from the sale of the land, this comment is also too vague to establish evidence of an agreement, and Ms. Ertl’s evidence also revealed that she was not privy to all discussions that Michael alleges created modifications to the agreement. For example, she indicated that she only learned when the sale was imminent that Monique was to be given money, whereas on Michael’s evidence this part of the agreement occurred years earlier once Monique began to bring her children around to see Betty Lou in 2001.

[92] I accept Ms. Ertl’s evidence as she gave it. Yet, significantly, Ms. Ertl did not testify that the parties ever spoke about or alluded to operating under the legalities of a binding agreement. I even accept that she observed Betty Lou and Bill looking at a spreadsheet on the computer in the library at the Homelands. The difficulty with accepting this fact as being evidence of an agreement is that Ms. Ertl did not testify that she was aware of hearing the parties discuss specific amounts or expressing assent with respect to the information contained on the spreadsheet. She was not asked to identify the Tab 467 spreadsheet as being the one she recalled from the computer screen. Given Michael’s evidence about the number of times he modified various spreadsheets, this evidence does not help this court to conclude that the parties were ever ad idem or even that there was an intention that an agreement had been made.

[93] Mrs. Calendar’s evidence as to what she knew about the historical land dealings was vague. She testified that when the offers for the land were for a smaller amount, like $6 million, Betty Lou told her that she only needed $1 million for the rest of her life. Mrs. Calendar heard this from her on a couple of occasions. She testified that Betty Lou felt this way because of Bill’s income. The first observation about this testimony is that there was never an offer for $6 million, and the only evidence of an offer coming close to that amount was the 1999 offer for $4,750,000. Accordingly, if statements were made by Betty Lou to Mrs. Calendar to the effect that she wanted only a million dollars from the land, the most reasonable time period to which such statements may be attributed would be when that offer was received.

[94] What is striking about Mrs. Calendar’s evidence is how it failed to address the totality of the Initial Agreement or any of its modifications. She did not testify that she knew about an agreement, or that she had been told anything about how the proceeds were to be distributed from the sale to Lormel. She did not mention anything about the Bradford Bypass Lands or Excess Lands. She did not tie the information about Michael being given the Home Lands to any agreement. Overall, therefore, I find that Ms. Calendar’s evidence lends little to the analysis of whether there was an agreement.

[95] There are additional aspects to Ms. Calendar’s evidence that cause me to have concern for the reliability of her recollections. First, Ms. Calendar’s recollection about the monthly amount received by Bill is inaccurate, as I have no reason to doubt the accuracy of that aspect of Betty Lou’s testimony. She also testified that Betty Lou and Nicole had a falling out over the fact that Nicole was asking her to babysit often, which would anger Bill. This was at odds with the more believable evidence of Michael, Nicole and Betty Lou that the cause of the rift was something entirely different. She also testified that Betty Lou and Nicole were not really talking up until the last couple of years, and it was not explained how she could know such a thing since, on her own evidence, she has not spoken with Betty Lou since 2008, unless such information came through Michael or another family member. This is concerning given that she testified that everything she knew and was testifying about came from Betty Lou. Mrs. Calendar testified that Betty Lou offered Nicole $1 million to sign off on the property, but that Nicole's lawyer said she would have to pay tax on that, so she said no. This too is inaccurate based on the more reliable evidence of those having direct knowledge of the event; Nicole declined to transfer the property because of her exposure to a capital gains tax, but she was never offered $1 million for her interest.

[96] Mr. Stratton likewise did not testify that the parties averred to an agreement during his discussions with them. His evidence affords the most reliable view into what was in the minds of the parties just prior to the Lormel closing. I accept that he left the meeting with the impression that Michael would be getting a greater portion of the vendor take back mortgage than his sisters, as I accept that that may have been part of how Betty Lou intended, at that point, to reward Michael for his efforts. I do accept that Michael anticipated that there would be more value coming to him, as it otherwise makes no sense that he used such a large portion of the initial payment to purchase a boat for $475,000. Yet Mr. Stratton’s evidence still falls short of establishing contractual intent or the terms of any such contract.

[97] It is argued that the first will was created to document the agreement between them and that Betty Lou appointed Michael as the executor of her estate because she knew that only he was aware of their agreement. If Michael’s evidence is believed, however, Bill Clute was equally aware of the agreement and, therefore, could have likewise been so named, particularly since he had been named as the executor in Betty Lou’s previous will. This choice appears more to be an expression of the degree to which Betty Lou had gained confidence in Michael over the intervening years. However, the first will cannot possibly document the contractual obligation that Michael says existed and is as confusing in its intent as much of the rest of the trial evidence. The provision granting the Home Lands to Michael upon her death, but only if he built a wheelchair accessible home for Bill, is perplexing given that only two months before this will was signed, Betty Lou and Bill had entered into an agreement to purchase a condominium in Barrie. The term that permits any remaining lots on the subdivision to be transferred to Michael is likewise uncertain given that all of the Subdivision Land belonged to Lormel on the date that the first will was signed. The phrase “my intention is that the balance of the lots be dealt with as per our agreement” is similarly uncertain in intent – even if a court charged with the task of interpreting this will were to find that the term “other lots” refers to the Bypass and Excess Lands, the words “as per our agreement” invites litigation such as the present action, and in the face of the contrary evidence in this case cannot be said to unequivocally refer to the agreement alleged by Michael.

[98] Then there is the Tab 467 spreadsheet. I reject the reliability of Betty Lou’s evidence surrounding this spreadsheet. It was clear from her evidence that her memory is faulty in attempting to recall the sequence of events in 2007. On her evidence, it is obvious that the creation of the second will was not provoked by receiving some letters from Michael, as the second will predates their receipt. It is possible that the first letter came on November 17 instead of December 17, given that there was reference in the second will to an estates lawyer being consulted on November 17. However, that was not the evidence given by Betty Lou, who testified that the letters came on December 3 and 17. I do not accept that she changed her will in response to whatever demands were made in such letters; it was more likely something that occurred on the cruise, as testified to by Ms. Ertl, or the revelation to Betty Lou of the proposed development on the Home Lands, as testified to by Mrs. Calendar.

[99] Similarly, I reject Betty Lou’s trial evidence that she first saw the Tab 467 spreadsheet when those letters were delivered by Michael. She was successfully impeached with her discovery evidence, where she stated that the first time she saw the Tab 467 spreadsheet was in February 2007 when she retrieved it from a brown envelope in her safe at the Home Lands, Michael previously having given it to her to store for safety. Her evidence on discovery was that it did not bother her “because it didn’t make sense”. I accept that she had seen the contents of the Tab 467 spreadsheet before the closing to Lormel and that she condoned a distribution of the immediate closing proceeds and the Lormel VTB as set out on that spreadsheet because she was initially willing to take a set amount from the sale. She spoke to others about receiving a set amount, although the exact sum varied. Such a distribution, together with the Home Lands, was how she intended to compensate Michael for his work. Parenthetically, the size of this reward is completely out of proportion to what I would have found, if required, was the value of Michael’s work throughout the OMB proceeding and in facilitating the sale. His evidence vastly overstated the extent of what he actually accomplished during the six years of his attention to this project. The only truly tangible by-products of his efforts were the successful opposition to the motion brought by the Town early on in the OMB proceedings, and the negotiation of a successful sale and its terms. A review of the totality of the evidence shows that what Michael claims to have accomplished was either a fait accompli before October 2001, occurred as part of the County or Town’s planning process, or was accomplished by the efforts of professionals paid for by other landowners or Betty Lou[^i]. Michael abandoned his quantum meruit claim in this proceeding and accordingly it is only in obiter that these comments are made; however, the expert evidence of Mr. Smith, which placed a value of $200,000 to $250,000 on the work undertaken by Michael, would have been more than ample compensation in the opinion of this court.

[100] Applying the objective test described by Professor Fridman in The Law of Contract in Canada, supra, there was no clear mutual intention to contract. I find that at no time did Betty Lou ever have an intention of creating any legally binding agreement with Michael.

[101] I find that Betty Lou did anticipate receiving only $4 million from the Lormel VTB at the time of closing and that she had discussions with Michael and others at various times from which that amount evolved. I accept that she intended to give him the balance of the proceeds from the Lormel VTB as set out on the Tab 467 spreadsheet because she felt by that point that he deserved it. She also intended to give him the Home Lands, as Mrs. Calendar testified, as a reward. For that reason, Michael undertook expressions of intended ownership, such as planting a vineyard and attempting to convert the pool to a saltwater system. However, even that intention and the fractured and incomplete understanding that developed between Michael and his mother as a result of her telling him of her intentions, does not establish the intention to create a binding contract with legal effect. I find that these valuable landholdings were intended to be a gift, and the revocation of the intention to give a gift has no legal repercussions.

[102] Another primary factor in reaching the conclusion that money flowed to Michael by way of gift is the fact that Betty Lou paid all of the capital gains tax that arose in 2007 at the time of receipt of the initial payment from Lormel. The uncontradicted evidence is that Betty Lou deposited $614,000 from the sale proceeds into a separate account. This could not have been part of their alleged agreement because it was Michael’s evidence that the responsibility of the parties for payment of taxes was never discussed during the formulation of the Initial Agreement or during any discussions thereafter. The entire $1.7 million received by Michael was tax free, and it was his evidence that he did not have to pay tax because the money was a gift from his mother. He testified that he called Revenue Canada to request an “advance ruling” on the issue, and his evidence was that the person with whom he spoke indicated that a gift from one’s parent is not taxable. At several time during his cross-examination he confirmed that the money from the sale of the Subdivision Lands was being received by him by way of gift.[^22] Although Michael alleged on cross-examination that the deal was structured this way in order to avoid the higher tax rate incurred on earned income, he gave no evidence that this consideration formed part of his discussions with his mother from the outset or at any time when the modifications were discussed. The theory advanced to the court by Michael was that, because his mother wanted only $4 million at the end of the day, she would be responsible for the payment of all taxes provided that she ultimately received that sum of money. If that were so, it would have been equally possible for Michael to pay the $614,000 out of the share that he initially received in order to move Betty Lou closer to her goal of receiving $4 million at an earlier time. This also would have been more consistent with the evidence given by Michael at trial to the effect that he wanted his mother to have her money sooner than later. Yet this is not what occurred; Michael did not offer to absorb the initial tax payment, and, accordingly, I conclude that Betty Lou was responsible for its payment because she wanted to make gifts to her children without imposing a tax burden upon them. This also rationalizes why she did not require Nicole to pay 10% of that capital gain in accordance with her percentage interest in the property.

[103] Making a gift to her children was consistent with Betty Lou’s prior behaviour, when, in 1996, she gave both Michael and Nicole a 10% interest in the property and would have done the same for Monique had the gesture not been rebuffed at the time. The evidence supports the inference that Betty Lou wished to share a portion of her wealth with her children during her lifetime. This fact was confirmed by Nicole, who described her mother as a generous person. She said that it was her understanding that her mother did not want to wait until after her death to share with her children. This generous intent remained unchanged even after Michael transferred his interest back during the time of his divorce, which was confirmed by Betty Lou during her cross-examination as follows[^23]:

Q. Okay, and despite the fact that Michael transferred back this ten percent in this matrimonial skirmish.

A. Hm-hmmm.

Q. You understood that no matter what, he would still have a ten percent interest in the property.

A. All three of my children would one day. That's what my hope was that when we sold I could share with them ten percent.

Q. Okay, I'm going to try and be very specific here, okay.

A. Hm-hmmm.

Q. When Michael transferred back his ten percent interest because of the family law skirmish with Kim Payou, you understood that you continued to hold a ten percent interest in favour of Michael, right?

A. It was never said out loud. I just automatically took for granted that was the way it was going to be down the road.

Q. That no matter what, Michael was still going to have a ten percent interest in the 100-acre parcel, even though he had transferred it back legally to you.

A. I think so, yeah. I believe he should, all three of them.

[104] Michael confirmed that this was his understanding also; even though he transferred his interest back to Betty Lou when going through divorce proceedings, he testified that the transfer had no effect on his entitlements from the 100 Acre Parcel. Accordingly, Michael’s actions between 2001 and 2007 are equally consistent with his knowledge that he would be receiving a gift as they are with the existence of a contract. It makes sense that he was focusing his efforts on the property in order to maximize his share.

[105] The making of a gift is antithetical to the existence of a contract. A gift is defined in Black’s Law Dictionary, 9^th ed. (St. Paul, Minnesota: Thomson Reuters, 2009) at p. 696 as a voluntary transfer of property to another without compensation: see also McNamee v. McNamee, 2011 ONCA 533, 106 O.R. (3d) 401, at paras. 23-25; Canada v. Zandstra, 1974 CanLII 2533 (FC), [1974] 2 F.C. 254 (T.D.). As such, the transfer of such property cannot be made pursuant to a contractual obligation but must be made without anticipation or expectation of material benefit: see Woolner v. Canada (1999), 249 N.R. 129 (Fed. C.A.).

[106] This court was asked to draw an adverse inference from the fact that Bill Clute was not called as a witness in this proceeding, even though Michael testified that he was frequently part of their discussions and had seen the various spreadsheets. The court could draw the inference that the failure to call him meant that he would not, under oath, have evidence to give that would be favourable to Michael’s case. However, I decline to draw such an inference, as doing so would disregard the fact that the onus of proving the existence of a contract was on Michael.

Certainty of Terms

[107] Even if I am incorrect in my conclusion with respect to intention to contract, this case fails on the basis that there is a lack of certainty surrounding essential terms in the alleged agreement, even if all of Michael’s evidence is accepted. There was simply never a settlement of terms sufficient to establish that the parties had reached a consensus on the terms by which they would consider themselves to be bound.

[108] The alleged Initial Agreement contains the following ambiguities with respect to what the court finds to be essential terms of the alleged agreement:

1. A definition of “the land” and “the property” around which this discussion centered – did “land” and/or “property” refer to the Subdivision Lands, the entire 100 Acre Parcel, or some other variant of the lands owned by Betty Lou and Nicole?;

2. What exactly were Michael’s obligations? What did it mean that he was to represent the land and “fight everybody off” with respect to the planning? What did it mean that he got to “run with the ball?”;

3. What was Michael prohibited from doing that would put the property in a position that it could be lost or “something”, or conversely what was he required to do to prevent such an occurrence?;

4. Was Nicole to receive $1 million or 10%? And from which portion of the 100 Acre Parcel – the entirety or again, some variant of the various sections?

[109] The glaring omission from these discussions is the certainty as to what Michael would be entitled to receive. Nowhere during his testimony did Michael ever say that his mother specifically told him that he would be receiving the Excess Lands, the Bradford Bypass Lands, or the Home Lands, either by way of transfer or trust interest.

[110] Also, when this Initial Agreement was allegedly struck, Michael confirmed during cross-examination that the following essential terms of the agreement had not been discussed:

1. The timing and payment of Betty Lou’s $1 million[^24];

2. Who would be responsible for payment of costs associated with the OMB and obtaining draft plan approval processes, including payment of experts and professionals[^25];

3. Who would be responsible for the payment of any applicable taxes upon development or sale[^26];

4. That the agreement must be kept secret from Nicole[^27].

[111] On this last point, Michael testified that it was essential that this agreement be kept secret from Nicole. It was his evidence that he and his mother discussed this “as soon as Nicole started causing conflict in the very beginning”. He testified that it was an understanding between them that if Nicole found out that Michael was receiving anything “over and above” what she was receiving, then she would refuse to sign documents and would hinder Michael in his efforts. Based on this evidence, the entire contract would have been frustrated had Nicole known of the agreement. Nicole confirmed in her testimony that she would have thwarted the “deal”, had she known about it.

[112] The parties were essentially in agreement as to when and why the falling out occurred between Betty Lou and Nicole, which lasted from January 2004 until sometime after the property was sold. The disagreement was initiated by Betty Lou’s request that Nicole go to the law office of Diana Riffert to transfer her 10% interest in the property because she and Michael were proceeding with the planning process and did not want to have to come to her to have “papers signed”. After receiving legal and tax advice, Nicole told her mother and Michael that she would not expose herself to the capital gains tax that would arise from the transfer, and so she refused to do so. This, together with Nicole expressing to her mother that she distrusted Michael and was unhappy that her mother was apparently placing so much faith in him, caused them to interact with one another coolly for the next few years and to avoid any discussions relating to the property.

[113] Accordingly, I find that this essential term that the agreement remain secret was one that arose only after January 2004, well after the Initial Agreement was allegedly made. This is one example of how the Initial Agreement was the subject of ongoing, varied discussion. Michael testified to this on cross-examination, stating “…there were so many conversations because I used to go to dinner with them all the time, I used to hang around with them all the time. There were so many different conversations…”[^28] His evidence was that this was an ever-changing bargain, when he was asked the following questions[^29]:

Q. Okay. You talked about toying with many ideas in the agreement, do you remember that? You and your mother toying with different ideas.

A. There were different areas that we could end up going into. Some parts we ended up looking for, to developing and it was going to be a different structure then, but then other times it turned into, you know, another way we had to go, but it was an evolving thing from the initial agreement –

Q. Yes.

A. -- onward. There was different ideas based on what we could do or what we couldn't do with things.

[114] Although Michael also testified that the Initial Agreement remained unchanged, he later agreed with changes suggested by his mother in order to have everybody “share the wealth”. He agreed that there were multiple changes to the Initial Agreement before reaching the one that he is attempting to pursue in this action, as earlier reviewed in these Reasons.[^30]

[115] At another point, Michael testified, the agreement was revised such that all three children would receive lots to develop. He testified that in March 2003 “[they] had already talked about how the lots were going to be divvied up to be giving my older sister and younger sister a chance to have their, them, their husbands build lots, or build houses, rather, on the lots and give them some good future to look forward to, as well”.[^31] With respect to this change, on cross-examination he stated that this idea to give lots occurred “when we were pushing to development, then that ten percent was going to be ten percent of the lots pretty much, so it’s like 30, but it didn’t amount to anything”.[^32]

[116] Further on in his testimony while relaying the discussion regarding the building of a wheelchair accessible bungalow, Michael stated that “there was always different ideas going around, but this was something that she really wanted”. In describing where that conversation occurred he remarked that it was in the library and further stated: “Some, you know, just working through ideas, maybe sitting watching TV in the family room, but mainly in the library”.[^33]

[117] As stated above, the timing of payment to Betty Lou, the costs associated with obtaining subdivision approval, and the responsibility for payment of taxes were clearly essential terms of any such agreement, and these terms were never clarified with any certainty.

[118] With respect to the timing of payment of Betty Lou, who was to receive what, and when, was key to this alleged deal as shown by the Tab 467 spreadsheet. Michael testified on several occasions that he wanted to see his mother receive her money quickly because she was older than he, but the results of the initial payment were that Betty Lou received less than Michael. He testified as to timing that “…it didn’t lock things into when. It was a work in progress”. According to the Tab 467 spreadsheet, Betty Lou would continue to receive less than him over the term of the Lormel VTB. This result was exacerbated by the fact that she paid 100% of the taxes associated with the sale.

[119] With respect to the payment of taxes, Michael asserted that it was a foregone conclusion that Betty Lou would be responsible for the taxes because all she was to receive was $4 million under the terms of the final modification to the Initial Agreement. However, the evidence does not indicate that the rationale for Betty Lou’s payment of taxes was either discussed or agreed upon. Ultimately Betty Lou paid taxes in the amount of $2,078,135.50 in 2007 to 2010, largely as a result of her capital gain income during those years[^34].

[120] The payment of costs associated with subdivision approval was also an essential term. Betty Lou and Bill funded the entirety of these costs. Michael testified that he was, from the outset, under the impression that he could develop at the same cost as a neighbouring land developer, Michael Orsi, had done in the past. This testimony revealed much about Michael’s competence to tackle this project on behalf of his mother, as it should have been clear to anyone reviewing the County’s Official Plan of 1997 and the Town’s Official Plan of 2002 that development was a costly proposition in Area 4 well before Michael became involved in the OMB hearings. These were the documents that indicated that professional studies and reports were required for draft plan approval and that cost sharing arrangements were to be imposed on anyone wishing to take advantage of development rights within Area 4. It was clear to the court that Michael did not have the means to pay any of the costs that were borne by his mother and Bill, and it would have been impossible for him to move forward with this alleged agreement without that assistance. The issue of whether Betty Lou and Bill would be compensated for these costs was never discussed with clarity, unless the additional $1 million that was to go to Bill was such “compensation”, which intent was unclear and the amount well in excess of the expenses paid by the Clutes during the process.

[121] As concluded in the previous section of these Reasons, there is no doubt that the land was the subject of numerous discussions between the plaintiff and his mother over the period of 2001 to 2007. The amounts that Michael and his mother would receive from the sale of the land was determined with specificity, albeit to be given to Michael by way of gift. However, the vagueness and lack of clarity that existed with respect to the other essential terms of this alleged agreement all support the conclusion that there was never to be an enforceable contract between mother and son.

THE COUNTERCLAIM

[122] The counterclaim seeks damages, primarily, for losses that would be incurred if the plaintiff’s claim was successful. It also seeks damages for the cost of repair of damage allegedly caused by the plaintiff to the Homelands. No evidence was led with respect to the cost of repair of such damage, nor was the evidence of damage sufficient to prove those damages on the balance of probabilities.

JUDGMENT

[123] For the foregoing reasons this court orders that this action and the counterclaim are dismissed.

[124] It is also ordered that:

(i) the Lormel VTB funds presently held in trust shall be released to Betty Lou and Nicole thirty days following the release of this decision, in accordance with their ownership interests set out in the now discharged Lormel VTB that was registered as instrument number SC519886 in the Land Registry Simcoe (#51) Barrie; and

(ii) the originals of exhibit 8, which were copies of calendars maintained by Betty Lou, shall remain in the possession and control of Mr. Ralston and shall not be released to his client for at least 30 days following the release of this decision, or until such time as may be determined on further motion pending any appeal of this action.

[125] If the parties are unable to agree upon the costs of this action they may schedule a hearing to speak to costs through the trial co-ordinator’s office.

HEALEY J.

Released: April 11, 2012

[^1]: This and the next two sentences were quoted by Lee J. in Rae v. Leighton (2002), 2002 ABQB 339, 308 A.R. 219 at 231 (Alta. Q.B.); additional reasons at (2002), 2002 CarswellAlta 433 (Alta. Q.B.); additional reasons at (2003), 2003 CarswellAlta 1805 (Alta. Q.B.), and by Cheverie J. in Carruthers Enterprises Ltd. v. P.E.I.T.F. (2002), 2002 PESCTD 2, 211 Nfld. & P.E.I.R. 42 at 45-46 (P.E.I.T.D.).

[^2]: Law Society (Saskatchewan) v. McLoed (1993), 1993 CanLII 8811 (SK QB), 115 Sask. R. 144 at 169 (Sask. Q.B.) per Walker J.; affirmed (September 13, 1994), Cameron J.A., Jackson J.A., Sherstobitoff J.A. (Sask. C.A.); leave to appeal refused (1995), (sum nom. McLoed v. Law Society of Saskatchewan) 137 Sask. R. 320 (note) (S.C.C.). Unless the document that constitutes the contract, e.g., a letter, is clear and unambiguous, when the “reasonable expectation” doctrine is inapplicable: Zama Holdings Ltd. v. Metropolitan Trust Co. Of Canada (1996), 1996 CanLII 10452 (AB KB), 43 Alta. L.R. (3d) 156 (Alta. Q.B.).

[^3]: This sentence was quoted by Baynton J. in Farm Woodlot Assn. Of Saskatchewan Inc. v. Bell (1994), 1994 CanLII 4843 (SK QB), 117 Sask. R. 282 at 288 (Sask. Q.B.); ITT Industries of Can. Ltd. v. Toronto Dominion Bank (1988), 1988 CanLII 3565 (AB KB), 63 Alta. L.R. (2d) 87 (Alta. Q.B.); Kernwood Ltd. v. Renegade Capital Corp. (1997), 1997 CanLII 846 (ON CA), 97 O.A.C. 3 (Ont. C.A.). Compare Bate Indutrial Services Ltd. v. Enerflex Systems Ltd., 1992 CanLII 14168 (AB KB), 132 A.R. 253 (Alta. Q.B.).

This classic formulation is that of Blackburn J. in Smith v. Hughes (1871), L.R. 6 Q.B. 597 at 607: “If whatever a man’s real intention may be, he so conducts himself that a reasonable man would believe that he was assenting to the terms proposed by the other party and that other party upon that belief enters into a contract with him, the man thus conducting himself would be equally bound as if he had intended to agree to the other party’s terms.” This has been referred to with approval and quoted in many Canadian cases: see, e.g., the judgment of Ritchie J. in St. John Tug Boat Co. V. Irving Refining Ltd., 1964 CanLII 88 (SCC), [1964] S.C.R. 614 at 622 (S.C.C.). Compare La Forest J.A. in Hallmark Pool Corp. V. Storey (1983), 1983 CanLII 2796 (NB CA), 144 D.L.R. 56 at 65 (N.B.C.A.). See however, De Moor, “Intention in the Law of Contract: Elusive or Illusory?” (1990), 106 L.Q.R. 632.

[^4]: (2003), 17 Alta. L.R. (4th) L.R. 243 at 249 (Alta. C.A.), in which no consensus ad idem was found.

[^5]: Harrison v. Whitelaw, 1923 CanLII 370 (AB CA), [1923] 3 D.L.R. 1183 (Alta. C.A.); Cummins v. Cummins, 1934 CanLII 294 (MB CA), [1934] 2 D.L.R. 228 (Man. C.A.); Jackson v. Macaulay, Nicolls, Maitland & Co., 1942 CanLII 250 (BC CA), [1942] 2 D.L.R. 609 (B.C.C.A.); contract Thomson Groceries Ltd. v. Scott, 1943 CanLII 100 (ON CA), [1943] 3 D.L.R. 25 (Ont. C.A.); Deslippe v. Maguire Const. Ltd. (1976), 1976 CanLII 947 (SK QB), 66 D.L.R. (3d) 130 (Sask. Q.B.). See also Pawluk v. Bank of Montreal (1994), 1994 CanLII 8984 (AB KB), 20 Alta. L.R. (3d) 76 (Alta. Q.B.); affirmed (1997) 1997 ABCA 34, 196 A.R. 61 (Alta. C.A.); leave to appeal to S.C.C. refused (1997), 212 A.R. 234 (note) (S.C.C.).

[^6]: Kelly v. Watson (1921), 1921 CanLII 23 (SCC), 61 S.C.R. 482 (S.C.C.); Murphy v. McSorley, 1929 CanLII 29 (SCC), [1929] S.C.R. 542 (S.C.C.); Barker v. Shakespeare; Gill Fuels Ltd. v. Shakespeare (1956), 1956 CanLII 334 (BC SC), 2 D.L.R. (2d) 768 (B.C. Co. Ct.); Causeway Shopping Centre ltd.v. Thompson & Sutherland Ltd (1926), 1965 CanLII 616 (NS SC), 50 D.L.R. (2d) 362 (N.S.S.C.); affirmed (1965), 1965 CanLII 614 (NS CA), 54 D.L.R. (2d) 649 (N.S.C.A.); Causeway Shopping Centre Ltd. v. Muise (1967), 1967 CanLII 633 (NS CA), 63 D.L.R. (2d) 26 (N.S.S.C.); affirmed 1968 CanLII 124 (SCC), [1969] S.C.R. 274 (S.C.C.); Re Pigeon & Titley (1973), 1972 CanLII 455 (ON SC), 30 D.L.R. (3d) 132 (Ont. H.C.); Nemetz (Arnold) Enrg. Ltd. v. Tobien, 1971 CanLII 1361 (BC CA), [1971] 4 W.W.R. 373 (B.C.C.A.); Cherewick v. Moore, 1955 CanLII 319 (BC SC), [1955] 2 D.L.R. 492 (B.C.S.C.); Block Bros. Realty Ltd. v. Occidental Hotel Ltd.; Rochelle v. Occidental Hotel Ltd. (1971), 1971 CanLII 1009 (BC CA), 19 D.L.R. (3d) 194 (B.C.C.A.); Spur Oil Ltd. v. R. (1981), 1981 CanLII 4674 (FCA), 42 N.R. 131 (Fed. C.A.); leave to appeal to S.C.C. refused (1981), 39 N.R. 354 (S.C.C.); Westward Farms v. Cadieux; Barnabe v. Cadieux (1982), 1982 CanLII 2972 (MB CA), 138 D.L.R. (3d) 137 (Man. C.A.); leave to appeal to S.C.C. refused (1982), 18 Man. R. (3d) 269 (S.C.C.); 304498 B.C. Ltd. v. Garibaldi Whistler Dev. Co. (1988), 1988 CanLII 3040 (BC SC), 25 B.C.L.R. (2d) 79 (B.C.S.C.); affirmed (1989), 1989 CanLII 2812 (BC CA), 39 B.C.L.R. (2d) 328 (B.C.C.A.); Morton v. Asper (1989), 1989 CanLII 7502 (MB QB), 62 Man. R. (2d) 1 (Man. Q.B.). Contrast De Laval Co. V. Bloomfield, 1938 CanLII 50 (ON CA), [1938] 3 D.L.R. 405 (Ont. C.A.), on which see Gordon (1939), 17 Can. Bar Rev. 204; Wright (1939), 17 Can. Bar Rev. 208; compare Montana Mustard Seed Co. V. Gates (1963), 42 W.W.E. 303 (Sask. Q.B.).

[^7]: Bank of N.S. v. McDougall & Secord Ltd. (1913), 1913 CanLII 305 (AB CA), 11 D.L.R. 546 (Alta. C.A.); Kerr v. Cunard (1914), 1914 CanLII 942 (NB SC), 42 N.B.R. 454 (N.B.S.C.); Fletcher v. Holden (1914), 19 B.C.R. 567 (B.C.S.C.); Lethbridge Brewing & Malting Co. v. Webster (1919), 1919 CanLII 130 (SK CA), 49 D.L.R. 250 (Sask. C.A.); Credit Protectors Ltd. v. MacKay, 1940 CanLII 168 (SK KB), [1940]3 W.W.R. 129 (Sask. Dist. Ct.); Phibbs v. Choo (1977), 1976 ALTASCAD 162, 69 D.L.R. (3d) 756 (Alta. C.A.); 259596 Alta. Ltd. v. Richards; Richards v. 259596 Alta. Ltd., 1982 CanLII 1243 (AB KB), [1983] 2 W.W.R. 592 (Alta. Q.B.); Rychjohn Invt. V. Hunter (1979), 1979 CanLII 2414 (SK QB), 100 D.L.R. (3d) 652 (Sask. Q.B.); Westward Farms Ltd. v. Cadieux Cadieux; Barnabe v. Cadieux (1982), 1982 CanLII 2972 (MB CA), 138 D.L.R. (3d) 137 (Man. C.A.); leave to appeal to S.C.C. refused (1982), 18 Man. R. (3d) 269 (S.C.C.); Spur Oil Ltd. v. R. (1981), 1981 CanLII 4674 (FCA), 42 N.R. 131 (Fed. C.A.); leave to appeal to S.C.C. refused (1981), 39 N.R. 354 (S.C.C.). But see Alta-West Group Invts. Ltd. v. Femco Financial Corp. (1984), 1984 CanLII 1234 (AB KB), 34 Alta. L.R. (2d) 5 (Alta. Q.B.); F.M.I. Consultants Ltd. v. Jeanpierre Hldgs. Ltd. (1985), 1985 CanLII 1451 (AB KB), 57 A.R. 304 (Alta. Q.B.).

[^8]: The passage from “For the most part” to here was quoted by Huband J.A. in Horizon Custom Builders Ltd. v. Behrens (2001), 2001 MBCA 198, 160 Man. R. (2d) 296 (Man. C.A.).

[^9]: Transcript of the proceedings at trial, examination of Michael Picavet November 15, 2011, at pp. 74-75.

[^10]: Mr. Petch was a lawyer representing Charter Construction, a landowner within Area 4.

[^11]: Transcript of the proceedings at trial, examination of Michael Picavet November 15, 2011, at pp. 74-75.

[^12]: Transcript of the proceedings at trial, examination of Michael Picavet November 15, 2011, at p. 75

[^13]: Transcript of the proceedings at trial, examination of Michael Picavet November 17, 2011, at pp. 109-110.

[^14]: Transcript of the proceedings at trial, cross-examination Michael Picavet, at pp. 201 – 202.

[^15]: Transcript of the proceedings at trial, examination of Michael Picavet November 18, 2011, at pp. 59-61.

[^16]: Transcript of the proceedings at trial, cross-examination of Michael Picavet, at p. 122.

[^17]: Exhibit 2, tab 164.

[^18]: Exhibit 7, volume 4, p. 467.

[^19]: Transcript of the proceedings at trial, examination of Michael Picavet November 23, 2011, at pp. 103-104

[^20]: Exhibit 20

[^21]: Paragraph 13 of the affidavit of Michelle Ertl sworn July 23, 2008, Exhibit 21, entered on the consent of counsel.

[^22]: Transcript of the proceedings at trial, cross-examination of Michael Picavet, at pp. 17-18, 21, 30-31.

[^23]: Transcript of the proceedings at trial, cross-examination of Elizabeth Clute, at pp. 127-128

[^24]: Cross-examination of Michael Picavet, pp. 119-122.

[^25]: Cross-examination of Michael Picavet, pp. 104-112.

[^26]: Cross-examination of Michael Picavet date, at p. 119.

[^27]: Cross-examination of Michael Picavet date, at pp. 132-134.

[^28]: Cross-examination of Michael Picavet date, at p. 119.

[^29]: Cross-examination of Michael Picavet, at p. 5

[^30]: Cross-examination of Michael Picavet date,at p. 202.

[^31]: Transcript of the proceedings at trial, examination of Michael Picavet November 17, 2011, at p. 38.

[^32]: Cross-examination of Michael Picavet date, at p. 202.

[^33]: Transcript of the proceedings at trial, examination of Michael Picavet November 15, 2011, at p. 75.

[^34]: Exhibits 25-28.

[^i]: The expansion of the urban boundaries of the Town of Bradford began in 1995 as part of the revision of the Town's official plan, following an amalgamation of three townships in 1991 which resulted in the Town of Bradford West Gwillimbury (the "Town"). The Town retained the services of a land-use planning consultant to prepare a comprehensive Official Plan for the restructured municipality. Consequently, a project known as the Bradford North Landowners Expansion Project was formed, led by developer Michael Smith. The Clute farm lay within the boundaries of the proposed expansion. Betty Lou and Bill joined the group of interested landowners and attended meetings.

The County of Simcoe Official Plan was adopted in October 1997 and approved by the Ministry of Municipal Affairs and Housing in April 1998. The Plan provided a policy basis for exercising the approval authorities for local municipal official plans and amendments, and applications for subdivision of land. That Plan alerted development applicants to the fact that plans of subdivision would require, or were likely to require, the submission of a storm water management report, a traffic impact study and an environmental impact study.

[1] The Official Plan that had been commissioned by the Town was adopted by Town Council on February 15, 2000. Schedule B to the Town’s Official Plan shows the urban area land use designations [Exhibit 11]. The Clute lands are shown on Schedule B to have a designation of residential and industrial/commercial, the former taking up approximately two-thirds of the total lands.

[2] The Official Plan required the completion of a Community or Secondary Plan for the identified growth areas within the Bradford urban area prior to development taking place. The Clute lands fell within such a growth area, known as Area 4. The Area 4 Secondary Plan was initially created on June 12, 2001 [as depicted in Schedule SP-1, Exhibit 13]. It shows, in respect of the 100 Acre Parcel, the sectioning of those lands into industrial/commercial, neighbourhood commercial, and low density residential areas, as well as the proposed location of a north/west minor arterial road and industrial/commercial service road.

[3] A discrete hearing was organized relating to the lands on the south side of the Bradford Bypass, including the 100 Acre Parcel. The County wished to maintain the initial designation of the lands south of the bypass as industrial/commercial, whereas the landowners, each with both unique and shared interests, wanted to minimize the area of industrial/commercial designation on his or her land. It is noted in the decision that the planning evidence in favour of the residential designation of the Clute lands, and its bordering neighbours Charter and Mirkopolous, was given by one planner, Mr. Walker. The hearing resulted in a decision released on March 15, 2002. In respect of the 100 Acre Parcel, the Board determined that approximately one-quarter of the Clute lands would remain industrial/commercial. The lands lying to the east of the hydro corridor would be residential. Prior to that decision, approximately one-eighth of the Clute lands east of the hydro corridor were designated as industrial/commercial [as shown on Exhibit 13].

Subsequently, Amendment No. 4 to the Town’s Official Plan revised as of June 2002 was adopted by Council, which provided further policy direction for Area 4 (the “Area 4 Secondary Plan”) [Exhibit 12]. One of the key features of the Area 4 Secondary Plan was to impose requirements for cost sharing arrangements on the landowners within Area 4. They were required to enter into Landowner Agreements as a condition of subdivision approval, and any non-participating landowner would not be entitled to benefit from any land use designation or development rights under the Area 4 Secondary Plan. Michael never advised Betty Lou to enter into the cost sharing agreement.