ONTARIO SUPERIOR COURT OF JUSTICE

Oshawa COURT FILE NO.: 85604/13

DATE: 2014-11-28

BETWEEN

Muhammad Farid

Plaintiff

— and —

Lynne Irene Porteous

Defendant

COUNSEL:

Muhammad Farid, self-represented

Stephen A. Cooper, counsel for Lynne Irene Porteous

HEARD: November 25, 2014

Edwards J.

REASONS FOR JUDGMENT

Overview

[1] The plaintiff and the defendant entered into an agreement of purchase and sale dated August 6, 2013, for the purchase of property municipally known as 26 Garrard Road, in Whitby, Ontario (“The Property”).

[2] The plaintiff and the defendant had been embroiled in earlier litigation (“the first action”) with respect to the property that ultimately resulted in a resolution dismissing the first action on a without costs basis, together with a full and final release signed by the parties on September 26, 2013. It is readily apparent from the affidavit evidence filed before this Court that Mr. Farid was anxious to purchase the property, while the defendant was a less than willing seller. Nonetheless, a binding agreement of purchase and sale was signed by the parties on August 6, 2013 (“The Agreement”).

[3] The plaintiff seeks specific performance of the agreement and other relief. The defendant by motion for summary judgment seeks an order dismissing the action and judgment for the $5,000 deposit paid by the plaintiff.

The Facts

[4] The agreement contained a clause that time was of the essence. The scheduled closing date was September 27, 2013, by no later than 6 p.m. The agreement did not have a provision that it was conditional on financing. The method of tender was covered by a clause in the agreement which required that money should be tendered with funds drawn on a lawyer’s trust account in the form of a bank draft, certified cheque, or wire transfer.

[5] Included in the agreement was Schedule “A”, which was initialled by both the plaintiff and the defendant. Paragraph 5 of Schedule “A” provided:

“The purchaser is aware that the property is being sold without a hot water tank and that the furnace is not functioning.”

[6] Mr. Farid in argument suggested that despite the fact that his initials are found on Schedule “A”, he was not aware of the provisions of paragraph 5, set forth above. This is extremely difficult to accept given the course of conduct evidenced in various documents filed with the Court, as it relates to the first action. Mr. Farid, in various documents that were exchanged in connection with the documents that were to give effect to the settlement of the first action, wanted to exclude any provision that related to the condition of the furnace. Ultimately, Mr. Farid’s concerns in this regard do not appear to have been borne out in the closing documents related to the first action and regardless, it is inconceivable given Mr. Farid’s earlier concerns that he was unaware of the condition in the agreement concerning the furnace.

[7] On the date scheduled for the closing, the defendant’s solicitors were advised by the plaintiff’s solicitor on the morning of the date of closing that the plaintiff was not in funds. The defendant’s solicitor, Bradley Phillips, treated this as an anticipatory breach of contract by the defendant’s solicitor. An affidavit of Mr. Phillips was filed as part of the defendant’s motion materials. Mr. Phillips deposes in his affidavit:

At no time was either myself or my office or my secretary contacted by the plaintiff’s solicitor or the plaintiff on or before the day of closing requesting access to the home or requesting that an HVAC contractor attend the home. The only call that I received on the day of closing was a call in the morning from the plaintiff’s solicitor advising that he was not in funds, which I treated as an anticipatory breach of contract.

[8] Mr. Farid chose not to put the evidence of his solicitor retained for the closing of the property in the form of an affidavit. The best evidence of whatever occurred on September 27, is the evidence of Mr. Phillips, and would have been the evidence of Mr. Farid’s solicitor which was not placed before the Court. I give no weight to Mr. Farid’s evidence of what occurred between the two solicitors involved in the closing, where that evidence conflicts with the evidence of Mr. Phillips.

[9] In addition to not putting any evidence before the Court from his solicitor, Mr. Farid chose not to put any evidence before the Court from his mortgage broker. Mr. Farid maintains in his evidence, and in his argument, that the mortgage broker would not advance the necessary funds to close the transaction because of the non-functioning furnace. Mr. Farid maintains that a request was made through his solicitor to Mr. Phillips to allow access to the property on the date scheduled for closing, to the mortgage broker and/or an HVAC contractor. This is denied by Mr. Phillips. If this conversation took place as is suggested by the plaintiff, such conversation should have been put into evidence by way of an affidavit from the plaintiff’s solicitor.

[10] As a result of the plaintiff’s inability to put his solicitor into the necessary funding to complete the transaction, the plaintiff’s solicitor sent a letter to the defendant’s solicitor at 4:17 p.m. requesting an extension of the closing to September 30, 2013. The correspondence from the plaintiff’s solicitor seeking such an extension, and the reasons why the plaintiff was not in a position to obtain the necessary mortgage financing were not disclosed in the letter received by the defendant’s solicitor.

[11] The request for an extension of time was refused. Mr. Cooper, on behalf of the defendant, argues, in my view appropriately, that the extension of time for closing was refused for entirely understandable and reasonable grounds. Specifically, it is suggested that given the first action between the parties that had only just been resolved, it was entirely reasonable for the defendant to deny any indulgence by way of an extension of time to close the agreement of purchase and sale.

[12] Mr. Farid during the course of argument, agreed with me that he did not put his solicitor in the necessary funds to close the transaction by 6 p.m. on the date scheduled for closing. Mr. Farid argued that if he had been given the opportunity, he had the ability to obtain the necessary funding through alternative sources, specifically by access to his various credit cards. The evidence filed by Mr. Farid however makes clear that in fact the certified funds that he needed to close the transaction were not available until two days after the scheduled closing date.

[13] Fundamentally, the agreement required that the closing take place on September 27, by no later than 6 p.m. The agreement required that the plaintiff’s solicitor have in his trust account funds upon which he could draw a certified cheque to tender upon the defendant. The plaintiff could not close the transaction on the date scheduled for closing. Time was of the essence. Mr. Farid knew that time was of the essence. The defendant, given the earlier litigation between the parties, was well within her reason not to grant any extension of time for the closing of this transaction.

[14] The plaintiff’s claim for specific performance is dismissed. The defendant claims the costs that she has incurred with respect to the failed closing of the subject property which she is prepared to set-off against the deposit of $5,000. The defendant would have been entitled in my view to the deposit. The costs that are sought are reasonable under the circumstances and as such the defendant is entitled to damages in the amount of $4,200 with the remaining $800 to be returned to the plaintiff.

[15] As to the costs of this litigation, counsel for the defendant seeks costs in the amount of $4,000. Mr. Farid indicated that if he had been successful in his motion he was looking for costs of $800. In fixing costs this Court must determine an amount that is reasonable from the perspective of the losing party. Given the protracted nature of the litigation that the parties had been embroiled in, together with the costs of this litigation, it is not unreasonable that the losing party could have expected legal costs at least in the order $4,000. Under the circumstances, the costs claimed on behalf of the defendant by Mr. Cooper, in the amount of $4,000 are reasonable. The plaintiff shall therefore pay to the defendant costs which I am fixing in the amount of $4,000 inclusive of HST and disbursements. The $800 that I have ordered to be returned to the plaintiff as part of the deposit is to be set-off against the costs’ award of $4,000, leaving $3,200 to be paid by the plaintiff to the defendant for costs.

The Honourable Mr. Justice Edwards

DATE RELEASED: November 28, 2014