COURT FILE NO.: 15 – 086 (Owen Sound)
DATE: 2015-11-25
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
J.M.B. CATTLE CORP.
Applicant
Respondents
Applicant
Peter T. Fallis and Alexandra Ferrier, for the Applicant
- and -
2144032 ONTARIO INC. &
THOMAS KAUFMAN, ESTATE TRUSTEE OF THE ESTATE OF WILLIAM H. KAUFMAN
Judy Fowler Byrne, for the Respondents
Respondents
HEARD: July 9, 2015,
at Owen Sound, Ontario
APPLICATION UNDER:
Courts of Justice Act, R .S. O. 1990 Chap. C. 43
Rules of Civil Procedure, R.R.O 1990, O. Reg. 194
Price J.
Reasons For Order
NATURE OF APPLICATION
[1] This application concerns the sign-back process that occurs in most real estate purchases in Ontario. The seller commonly makes changes to the buyer’s offer, initials the changes, and returns the amended offer to the buyer. The buyer initials the seller’s changes, makes any further changes that the buyer wants, initials them, and sends the further amended offer to the seller, and so on, until an agreement is reached.
[2] The present dispute arose when the plaintiff, J.M.B. Cattle Corp. (“JMB”) offered to buy lands on Harrison Island in Georgian Bay (“the property”), part of which was owned by 2144032 Ontario Inc. (“214”), and the other part of which was owned by the Estate of William H. Kaufman (“the Estate”) (collectively, “the sellers”). The Estate was willing to sell only some of its lands, so JMB, in its offer to buy the property (“the first offer”), undertook to apply for severance of the lands that the Estate was willing to sell from the lands that the Estate was unwilling to sell (“the severance clause”). The severance clause allowed JMB to terminate the agreement on or after January 2, 2015, if final severance approval, defined as the date when all appeals from the severance decision expired, had not been obtained by that date. The first offer expired on October 7, 2013.
[3] The sellers made changes to the first offer, including two that allowed either the buyer (JMB) or the sellers to terminate the transaction if final severance approval was not obtained by the stated deadline, which eventually was stated to be March 10, 2015 (“the mutual severance clause”). The sellers sent the amended offer (“the second offer”) to JMB, with an expiry date of October 18, 2013.
[4] JMB initialed some of the sellers’ proposed changes, but neither crossed out nor initialed the two changes containing the mutual severance clause. It also added a clause that designated JMB as the sellers’ agent for purposes of the severance application (“the agency clause”), and sent the further amended offer (“the third offer”) to the sellers. The third offer expired on March 10, 2014.
[5] The sellers made a minor change to the agency clause, and sent the further amended offer (“the fourth offer”) to JMB. The fourth offer expired on March 20, 2014.
[6] JMB made minor changes to the fourth offer, and on March 28, 2014, sent the further amended offer (“the fifth offer”) to the sellers. The fifth offer expired on April 5, 2014. On April 4, 2014, the day before the fifth offer expired, the sellers signed that offer, in which the mutual severance clause was still not crossed out or initialed. As a result, the fifth offer became an agreement of purchase and sale (“APS”). JMB signed an acknowledgement of the APS on April 8, 2014.
[7] The Planning Board rejected the severance application that JMB made on behalf of the Estate. JMB appealed that decision to the Ontario Municipal Board, but adjourned the hearing of the appeal when the sellers notified JMB that they were exercising their right to terminate the APS. JMB then brought the present application for a declaration that it has the exclusive right to terminate the APS.
[8] If only JMB can terminate the APS, the sellers may not sell the property to anyone other than JMB until final severance approval is obtained. JMB argues that the sellers, by signing the fifth offer without the JMB’s initials next to the changes that the sellers had added when it made the second offer, agreed not to sell its lands to anyone until final severance approval was obtained. It says that had the sellers not made that agreement, JMB would not have incurred the expense of applying for severance and appealing from the Planning Board’s refusal of its application.
[9] The Estate now wants to sell its lands to another buyer (the same party, it appears, that opposed JMB’s application, on behalf of the Estate, for severance before the Planning Board). The sellers argue that by signing the APS without crossing out the mutual severance clause, JMB agreed that the sellers could terminate the APS if final severance approval was not obtained by March 10, 2015. They say they would not have given JMB the exclusive right to terminate the APS, as this would have placed their right to sell their property exclusively, and indefinitely, in JMB’s hands.
[10] JMB obtained an order, without notice to the Estate, granting it a Certificate of Pending Litigation (“CPL”), which it registered on the title to the property. The sellers, including the Estate, found another buyer for the property, but were unable to sell to that buyer while the CPL was on title. JMB requests an order confirming that only it can terminate the APS until ten days after final severance approval is given. The Estate opposes JMB’s motion, and moves to discharge the CPL from title.
BACKGROUND FACTS
a) The first offer
[11] On September 25, 2013, JMB made an offer, on an Ontario Real Estate Association form, to 214 and Thomas Kaufman (“Mr. Kaufman”), Estate Trustee of the Estate, to buy the real property on Harrison Island on Georgian Bay, on Lake Huron (“the property”) which 214 and the Estate collectively owned (the first offer”):
A. Land Parcel Owned by the Estate
PIN 52243-0128 (LT)
PCL 7162 SEC NS; PCL 1 ON ISLAND 97A IN FRONT TWP OF HARRISON IN THE GEORGIAN BAY OF LAKE HURON AS IN LT43463 SAVING AND EXCEPTING AN ALLOWANCE OF 10 FT IN PERPENDICULAR WIDTH ALONG THE SHORE OF SAID PCL; THE ARCHIPELAGO
B. Land Parcels (adjoined) Owned by 214
PIN 52243-0675 (LT)
PCL 1721 SEC NS; PCL 2 OF ISLAND XCVIIA IN GEORGIAN BAY IN FRONT OF TWP OF HARRISON SAVING & EXCEPTING A STRIP OF LAND 10 FT IN PERPENDICULAR WIDTH ALONG THE SHORE OF THE SAID PCL; THE ARCHIPELAGO
PIN 52243-0127 (LT)
PCL 18021 SEC NS; PCL 1 OF ISLAND AR14 OR 97A IN FRONT TWP OF HARRISON IN THE GEORGIAN BAY; THE ARCHIPELAGO
PIN 52243-0132 (LT)
PCL 1920 SEC NS; PCL 4 ISLAND 97A IN FRONT TWP OF HARRISON IN GEORGIAN BAY OF LAKE HURON ON THE NW END OF SAID ISLAND ABOUT 2 3/4
[12] There were two parts of the property that JMB proposed to buy, one part owned by 214 and the other part owned by the Estate. Because the Estate did not want to sell all of the lands that it owned, JMB offered to buy the entirety of the lands that 214 owned and that part of the Estate’s lands that the Estate was willing to sell.
[13] As JMB’s offer was for the entirety of 214’s lands, no severance was needed for that part of the sale. As its offer was for only part of the Estate’s lands, severance approval was required for that part of the sale. Because the Estate did not want to sell all of its lands, it wanted any agreement of purchase and sale that it entered into to include a clause requiring the buyer to obtain severance approval. JMB therefore included, in the first offer, Clause 7 of Schedule “A”, which required the buyer to obtain the necessary severance approval for those Estate’s lands that were to be part of the sale. The offer further provided that if the buyer did not obtain the necessary approval by January 2, 2015, the buyer would be entitled to terminate the agreement.
[14] Clause 7 of Schedule “A” to the first offer reads:
The Buyer shall, at the Buyer’s cost and expense, seek a consent from the local consenting authority (the Consenting Authority) to the severance of the property from the Seller’s adjoining lands …. On or after January 2^nd^, 2015, the Buyer may terminate this agreement by written notice to the Seller if the final severance approval has not yet been obtained. Final severance shall be the time at which all appeal periods in respect of the approved severance have expired.” [Emphasis added]
The first offer expired on October 7, 2013.
b) The second offer
[15] On October 14, 2013, the realtor for the sellers sent a “sign back offer” dated October 11, 2013, to JMB’s realtor (“the second offer”). The second offer contained handwritten additions to, and deletions from, the first offer, each of which was initialed by Mr. Kaufman for the sellers.
[16] The changes that the sellers made included some words that are crossed out, and some handwritten words that are added. The sellers interpret the relevant wording of the second offer as follows, with handwritten additions underlined in bold italics:
On or after January 2nd, 2015 June 1, 2014, the Buyer or Seller may terminate this agreement by written notice to the Seller to each other if the final severance approval has not yet been obtained.
Mr. Kaufman initialed each change, being the date, the addition of the words, “or Seller”, and the added words, “to each other.” The second offer expired on October 18, 2013.
c) The third offer
[17] On February 25, 2014, JMB’s realtor sent a further “sign back offer” to the realtor for the sellers (the “the third offer”).The third offer added Clause 6A to Schedule “A”, which made JMB the Estate’s agent for purposes of the severance application. It read as follows:
The Seller agree [sic] to provide a letter of consent stating that the Buyer is representing the Sellers as their agent for purposes of the severance applications with the governing authorities.
Clause 6A did not restrict or limit how long JMB would be authorized to act as agent of the sellers for purposes of the severance applications.
[18] Some of the property that JMB proposed to buy from 214 was also to be severed from other property belonging to 214, but only approval of severance of the Estate’s lands was a condition of the APS.
[19] The third offer included several handwritten additions to the second offer, next to each of which JMB stamped a blue star. JMB’s signing officer placed his initials inside all but two of the blue stars. The two blue stars that he did not initial contained the mutual severance clause, which added the handwritten words, “or Sellers”, and “to each other”, to Clause 7 of Schedule A. While not initialing those added words, JMB’s signing officer also did not cross them out. The third offer expired on March 10, 2014.
d) The fourth offer
[20] On March 11, 2014, the realtor for 214 and the Estate sent a “sign back offer” to JMB’s realtor (“the fourth offer”).The fourth offer included a small number of handwritten changes and additions, each of which was initialed by Mr. Kaufman on behalf of the sellers. These included the following changes to Clause 6A to Schedule “A”:
The Seller agree [sic] to provide a letter of consent stating that the Buyer is representing the Sellers as their agent for purposes of the severance applications with the governing authorities as pertains to the properties referred to in this agreement.
No changes were made to Clause 7 of Schedule “A”, and no mention was made of the fact that JMB had neither crossed out nor initialed the words that the seller had added, constituting the mutual severance clause, beside which now appeared empty blue stars. The fourth offer expired on March 20, 2014.
e) The Fifth Offer
[21] On March 28, 2014, JMB’s realtor sent a further “sign back offer” to the realtor for the sellers (the “fifth offer”). The fifth offer included a small number of handwritten changes and additions, each of which were initialed by JMB’s signing officer. There were no changes to Clause 7 of Schedule “A”, and JMB’s signing officer still had not crossed out or initialed the handwritten additions to the second offer (“the mutual severance clause”), beside which appeared the empty blue stars that JMB had added to the second offer. The fifth offer was to expire on April 5, 2014, and provided, in Clause 7 of Schedule “A”, that the agreement could be terminated if severance approval had not been obtained by March 10, 2015.
f) The agreement of purchase and sale
[22] On April 4, 2014, the realtor for sellers sent a fully executed “accepted Offer” to JMB’s realtor. His acceptance transformed the fifth offer into an agreement of purchase and sale (the “APS”) by which JMB, as buyer, and 214 and the Estate, as sellers, agreed on the purchase and sale of the property.
[23] On April 8, 2014, JMB’s realtor sent a copy of the “Acknowledgement of Offer” to the realtor for the sellers. On April 10, 2014, the sellers’ realtor sent an “Acknowledgement of Offer” to JMB, and appointed JMB as the sellers’ agent for the purposes of the severance applications. The Acknowledgement did not include any end date, time limitation, or mechanism for retracting the appointment.
g) Application for Severance
[24] JMB applied, on behalf of the Estate, to the Archipelago Area Planning Board at Parry Sound (the “Planning Board”) to sever the 2.7 hectare parcel that the Estate was willing to sell from the other lands owned by the Estate, to give effect to the terms of the APS. It simultaneously applied for severances relating to the property owned by 214, which were not required for the completion of the APS. In applying for severance, JMB incurred costs, including application fees and the expense of retaining a professional planner to help it prepare the application and present it to the Board.
[25] The Board’s staff planner reviewed the severance application and recommended that the Board approve it. However, the owner of a neighbouring property opposed the application and the Planning Board, on October 16, 2014, denied the application, giving as its reason that the severance would not create appropriate land use.
[26] JMB appealed on behalf of the Estate from the Planning Board’s decision to the Ontario Municipal Board (the “OMB”) on November 4, 2014. JMB thereby incurred an additional appeal fee and additional legal costs, in retaining experienced counsel to represent JMB before the OMB. A hearing date was set for March 31, 2015.
[27] The APS provided that the deadline for obtaining severance approval was March 10, 2015. Because JMB’s appeal to the OMB was scheduled to be heard on March 31, 2015, JMB’s lawyer wrote to the Estate’s lawyer on February 25, 2015, requesting a formal extension of the deadline for obtaining severance approval in order to await the decision of the OMB and allow JMB time to prepare surveys.
[28] In the meantime, the neighbouring property owner, who had opposed the severance application before the Planning Board, offered to buy the property that was the subject of the APS from 214 and the Estate. On March 12, 2015, the sellers’ lawyer advised JMB’s lawyer that the sellers had “decided to exercise their right to terminate the purchase agreement.” Attached to that communication was a “Termination of Agreement by Buyer” form, which the lawyer asked JMB to sign.
[29] JMB refused to sign the Termination. It wished to continue with its appeal to the OMB, obtain approval of the severance, and complete the transaction contemplated by the APS.
[30] On March 22, 2015, the realtor for 214 and the Estate told JMB’s realtor that 214 and the Estate wanted to sell the property to a group of local landowners calling themselves the “Georgian Bay Land Trust.” They intended to sell the same portion of the Estate’s lands that was the subject of the APS, which would also require severance of the lands that the Estate was willing to sell.
[31] Upon realizing that 214 and the Estate would not close the APS even after the resolution of the OMB appeal, JMB adjourned the OMB hearing date from March 31, 2015, and brought the present application on April 2, 2015, as well as an ex parte motion for Certificates of Pending Litigation in relation to the property.
[32] The sellers attempted to serve Alan Hill, the principal of JMB, personally with a Notice of Termination by delivering it to JMB’s registered head office. The Estate’s process server discovered that JMB no longer maintained his head office at that location, and that Alan Hill no longer resided there. After several attempts, the process server located Alan Hill’s son, and on March 31, 2015, delivered the Notice of Termination to him, and was assured that he would give it to his father.
ISSUES
[33] The application and motion raise the following issues:
a) Is the APS a binding agreement?
b) If the APS is binding, does it permit only JMB, or both JMB and the sellers, to terminate it after March 10, 2015?
c) Are 214 and the Estate estopped from terminating the APS?
d) Is JMB entitled to specific performance of the APS?
e) Are 214 and the Estate entitled to a discharge of the Certificate of Pending Litigation?
POSITIONS OF THE PARTIES
[34] JMB argues that only it can terminate the APS until ten days after the severance approval is given. It seeks a declaration to that effect.
[35] 214 and the Estate (the sellers) argue that JMB or the sellers may terminate the APS after March 10, 2015. They request an order dismissing JMB’s application, discharging the CPL registered against the title of the property, and permitting them to retain JMB’s non-refundable deposit in the amount of $5,000.00.
ANALYSIS AND EVIDENCE
Jurisdiction
[36] JMB, in its application, seeks an interpretation of the APS and a declaration as to its exclusive right to terminate the agreement and therefore to purchase the property. A proceeding may be commenced by application where the relief claimed involves the determination of rights that depend on the interpretation of a contract, or seeks a declaration of an interest in land.[^1] The court therefore has jurisdiction to hear and determine JMB’s application.
a) Is the APS a binding contract?
[37] The Ontario Court of Appeal, in UBS Securities Canada, Inc. v. Sands Brothers Canada, Ltd., expressed the basic principles of contract formation in the following terms:
For a contract to exist, there must be a meeting of the minds, commonly referred to as consensus ad idem. The test as to whether there has been a meeting of the minds is an objective one – would an objective, reasonable bystander conclude that, in all the circumstances, the parties intended to contract? As intention alone is insufficient to create an enforceable agreement, it is necessary that the essential terms of the agreement are also sufficiently certain.[^2] [Emphasis added.]
[38] The Ontario Court of Appeal in Olivieri v. Sherman, in 2007, re-stated the principle that an objective test is used to determine whether the parties reached a consensus:
The apparent mutual assent of the parties essential to the formation of a contract, must be gathered from the language employed by them, and the law imputes to a person an intention corresponding to the reasonable meaning of his words and acts. It judges his intention by his outward expressions and excludes all questions in regard to his unexpressed intention. If his words or acts, judged by a reasonable standard, manifest an intention to agree in regard to the matter in question, that agreement is established, and it is immaterial what may be the real but unexpressed state of his mind on the subject.[^3] [Emphasis added.]
[39] In order to form a binding contract, there must be objectively ascertainable agreement on the essential terms of the contract, namely, the parties, the price, and the closing date.[^4]
[40] In the present case, there was no uncertainty or unresolved negotiation as to the final terms of the APS. If there were such uncertainty, if “[t]he whole of the correspondence, interviews and conduct of the parties showed that they had not agreed upon the terms of a contract and that [a party], up to the conclusion of the negotiations, was still trying to obtain terms more satisfactory to himself”, a completed offer and acceptance may not be established.[^5]
[41] In the present case, the parties to the APS demonstrated their belief that they had reached a valid and binding contract, in the following ways:
On April 10, 2014, Mr. Kaufman, on behalf of the sellers, signed an Authorization appointing JMB as the sellers’ agent for the purpose of the severance applications. This appointment was a requirement of Clause 6A of Schedule “A” of the APS contract. Had a binding agreement not been reached, the appointment would not have been necessary.
On February 25, 2015, JMB sought the sellers’ agreement to extend the time for closing of the APS. Had there not been a binding agreement, such an extension would not have been necessary.
On March 10, 2015, the sellers sought to have JMB sign a “Termination of Agreement by Buyer”. The sellers would not have had any reason to terminate an agreement that was not binding to begin with. It is clear that, as of March 10 and 12, 2015, 214 and the Estate believed there to be a binding agreement between the parties.
JMB hired professional planners, prepared and submitted a severance application, and retained a lawyer to undertake an appeal to the OMB from the Board’s refusal of the severance application. JMB would not have taken these steps had it not believed that it had a binding agreement for the purchase of the property.
[42] Additionally, the parties’ realtors had the power and authority to speak and act on behalf of their clients, and to bind them by their words and actions.[^6] The realtors, by their conduct, also demonstrated their belief that a binding agreement had been reached, in the following ways:
On April 4, 2014, the sellers’ realtor indicated that a binding agreement had been reached in an e-mail to JMB’s realtor, which read, in part, “...I attach the above pages of the accepted Offer to [the Property]”.
On April 8, 2014, JMB’s realtor said, in an e-mail to the sellers’ realtor dated April 8, 2014, “Copy of acknowledged offer as discussed.”
[43] From the date when the parties signed the APS to the date when the sellers terminated the APS, the parties conducted themselves as if there were a binding agreement between them. Both relied on that belief, JMB in expending time and resources pursuing a severance application and the sellers in refraining from listing the property for sale to others.
[44] The terms of the APS were clear and unambiguous with respect to the three essential terms, being parties, price, and timing.
a) Parties - the APS clearly states that the parties to it are JMB as buyer and 214 and the Estate as sellers.
b) Price - the APS clearly states the price to be paid for the property is $800,000.00 with a $5,000.00 non-refundable deposit.
c) Timing – the APS clearly states that the closing date for the sale of the Property is to be “...no later than 5:00 p.m. on the 15^th^ business day following final approval of the severance and following all public comment timelines have passed.”
[45] As the terms of the contract were objectively clear, and there was consensus as to the essential terms of parties, price, and timing, there was a valid and binding contract for the sale of the lands.
[46] Where an Offer is made for the purchase of property, and only some of the handwritten additions are initialed, there can still be a binding contract. Mutual assent is not required for the formation of a valid contract, only a manifestation of mutual assent. Whether or not there is a manifestation of mutual assent is to be determined from the overt acts of the parties.[^7]
[47] In order to form a contract, the parties must be of one mind (“ad idem”) as to the essential terms of the contract, namely the parties, the period, and the price.[^8] To determine whether the parties reached a meeting of the minds, or consensus ad idem, the court applies an objective test. The court considers whether a reasonable person, apprised of all the circumstances, would believe that the parties had reached an agreement.
[48] I find that a reasonable person, apprised of all the circumstances, would believe that the parties reached an agreement. The sellers signed an acceptance of the fifth offer, and both parties signed an acknowledgment that it constituted an agreement of purchase and sale. Additionally, the sellers signed an Acknowledgment that gave JMB authority to act as their agent in the severance applications.
b) Interpretation of the APS – If the APS dated April 4, 2014, is a binding agreement, which party or parties had the right to terminate the agreement?
[49] Having found the APS to be a binding contract, the court must interpret paragraph 7, Schedule “A” of the APS. The parties assert different understandings of its meaning. The sellers argue that by not crossing out the words they had added, which constituted the mutual termination clause, JMB agreed to that term. JMB argues that by not initialing the added words, it signified its rejection of them. The sellers argue that by delivering the third and fifth offers without crossing out the words that they had added, JMB acquiesced in the added words, which became part of the third and fifth offer. JMB argues that by not initialing the added words, they excluded the mutual termination clause from the APS. For the reasons that follow, I reject JMB’s argument and find that the words that the sellers added, constituting the mutual termination clause, form part of the APS.
General principles applying to the interpretation of commercial contracts
[50] When interpreting any commercial contract, the court applies the following principles:
The contract as a whole is interpreted in a manner that gives meaning to all of its terms and avoids an interpretation that would render one or more of its terms ineffective;
The parties’ intention is determined in accordance with the language they used in the written document, and based on the “cardinal presumption” that they intended what they said;
The court considers the objective evidence of the facts underlying the negotiation of the contract, without reference to the parties’ subjective intentions; and
The court employs an interpretation that accords with sound commercial principles and good business sense, and that will not result in a commercial absurdity.[^9]
(i) Giving meaning to all the terms
[51] The primary meaning of a contract, if not ambiguous, should prevail. A written agreement is measured by an objective reading of the language chosen by the parties to reflect their agreement. The mutual assent of the parties essential to the formation of a contract must be gathered from the language used by the parties. The law imputes to a person an intention corresponding to the reasonable meaning of his words and acts.[^10]
[52] From October 14, 2013, when the sellers’ realtor sent their sign-back offer dated October 11, 2013, to JMB’s realtor, (“the second offer”), and thereafter, the wording of the offers was as follows:
On or after (the date specified), the Buyer or Seller may terminate this agreement by written notice to each other if the final severance approval has not yet been obtained.
[53] JMB, upon receiving the second offer, did not cross out the added handwritten words. It returned the third offer, and the fifth, containing the words. The acceptance of the fifth offer by 214 and the Estate, and the resulting APS, must be interpreted in a way that gives meaning to those words. The court must avoid an interpretation that would render those words ineffective.
[54] The interpretation of a contract involves an objective assessment of the meaning of the terms of that contract.[^11] The court’s interpretation of the fifth offer, and the APS that resulted from the seller’s acceptance of it, must be based on the “cardinal presumption” that the parties intended the words that appear on those documents.
[55] JMB’s Offer dated March 28, 2014, (the fifth offer) contained, in paragraph 7, Schedule “A”, the mutual termination clause that lies at the heart of this application. JMB cannot reasonably be said to not have noticed the words. It was required to cross out the words if it rejected them.
[56] JMB submits that the correct reading of the relevant sentence of Clause 7 of Schedule “A” to the APS is “On or after March 10, 2015, the Buyer may terminate this agreement by written notice to the Seller if final severance approval has not yet been obtained.” That is not what the APS says. The words “or Sellers” appear after the words “the Buyer”, and the words “the Seller” are crossed out and the words “each other” appear in their place. I am bound to give the words that remain, which are unambiguous, their plain meaning.
(ii) Objective evidence of the negotiation
[57] An e-mail dated March 11, 2014, from the seller’s agent to the buyer’s agent, tendered as an exhibit on the motion, discloses that the seller was requesting a higher deposit for the reason, among others, that “the property could be tied up for a one year period”. While the buyer’s agent, in his reply dated March 28, 2014, reduced the deposit to the earlier amount because the buyer “will be incurring significant costs throughout the severance process that are also non-recoverable if it gets turned down”, he does not challenge the seller’s agent’s assertion that the property could be tied up for a one year period.
[58] I find that the one year period that the parties were referring to in their e-mails in March 2014, and which they contemplated would be the period when the property would be tied up by the APS, was from March 2014 to March 2015. I find that the parties did not expect that JMB would have the right to prevent the sellers from selling their property to others for an indefinite period beyond March 10, 2015, until JMB exhausted all appeals from an unfavourable decision regarding severance.
[59] The sellers, after adding the words “or Sellers” to import the mutual termination clause, crossed out the words “to the Seller” and replaced them with the words “to each other” to signify to whom the parties were to give notice of termination. JMB, in responding to these changes in Offer 3, did not cross out the words “to each other”, which the sellers had added, or restore the words “the Seller” which the sellers had crossed out. The significance of the crossing out of rejected words is heightened by the fact that one of the parties, likely JMB, crossed out the closing date January 2^nd^, 2015, and replaced it with March 10, 2015, and both parties acknowledge the March date was the operative one. I interpret JMB’s failure to cross out the words “or the Sellers” to identify the parties who could terminate the agreement, and the words “to each other” to identify the party that either could notify of termination, as its implicit assent to the mutual termination clause.
[60] In past cases involving the interpretation of agreements resulting from the exchange of offers and counter-offers, it has been held that if one party is aware of the latest change to a proposed contract, but expresses no objection to it, they may be taken to have accepted the proposed change.[^12] Applying this principle, I must determine whether JMB expressed an objection to the inclusion of the handwritten addition of the mutual termination clause. It did not initial the blue star next to the edits, which it says should be interpreted as an expressed objection to the term. It relies on the fact that it initialed every change to the earlier offer except the words “or Sellers” and “to each other.” It submits that the absence of initials on those changes was drawn to the attention of 214 and the Estate by the blue star stamp that JMB placed next to those changes, and it stresses that the blue stars beside those changes are the only ones that it did not initial.
[61] JMB argues that this is not a case where the parties were sloppy in their execution of the contract. Both parties were represented by competent realtors who, according to JMB, clearly advised them that all modifications to the contract had to be initialed in order to be binding. I do not agree.
[62] There is no evidence that the realtors advised their clients that all changes to the offers had to be initialed in order to be binding. The initials were made to offers, not to a contract that both parties had signed. This is a fundamental distinction. Certainly, once the parties signed the APS, a later amendment of the agreement would have required the initials of both parties. However, until the APS was arrived at, the assent of one of the parties to a term proposed by the other could equally be evidenced by initials next to a proposed term or by the wording of the offer that the party delivered.
[63] JMB delivered the third and fifth offers containing the mutual termination clause. Its failure to initial the changes that the sellers had previously made, which were handwritten and therefore distinctive from the surrounding typed words, does not trump the evidentiary significance of its delivery of an offer that contained that term, regardless of who initially proposed it.
[64] JMB may not rely on its own failure to initial the changes that the sellers had made to the document, as JMB incorporated the same document as part of its own offers (the third and fifth offers) to the sellers. Initials are evidence of assent, and if the sellers had sought to rely on its own (the second) offer, with the words that they themselves had added, as an agreement binding on both parties, the absence of JMB’s initials would have deprived them of evidence of JMB’s assent. However, JMB’s delivery of offers containing the words that the sellers had added is equally evidence of its assent. By amending the second offer and returning it, as the third offer, and by amending the fourth, and signing it back as the fifth offer, without crossing out the words that the sellers had previously added, JMB made the wording its own in those offers.
[65] In Walton v. Landstock Investments Ltd., in 1977, the Court of Appeal held that where an offeree delivered a counter-offer containing added words that the offeree typed, and did not initial, and which passed un-noticed by the recipient, it amounted to an innocent misrepresentation that the offer was unchanged except where initialed. The court held that such a counter-offer could be avoided by the recipient, or affirmed, at his option. In the present case, the changes that the sellers made to the first offer, which added the mutual termination clause, were handwritten and initialed by the sellers, and therefore clearly distinguishable from the remainder of the typed document. JMB was clearly aware of them because it placed blue stars beside them. While JMB stamped blue stars wherever changes had been made, some which were initialed and others which were not, it did not clearly distinguish those that it now says it did not approve.
[66] JMB submitted two offers that contained the mutual termination clause, notwithstanding that it did not initial the changes that imported the term. It had an opportunity on both occasions to cross out the terms to make it clear that they did not form part of the final agreement, or to accompany its offers (three and five) with a letter stating that it did not agree to the mutual termination clause.
[67] The B.C. Court of Appeal, in Cariboo-Chilcotin, in 2006, held that the respondent had accepted the handwritten term that the appellant had added, even though the respondent had not initialed the change. The respondent did not express objection to the added term, and distributed the contract, with the added term, as confirmation of the bargain. Donald J.A. noted that the contract consisted of only one page, and that the added clause must have come to the attention of the respondent. He stated, “Can a party ignore a term added to the contract document by another party in the course of negotiation and conclude the bargain as though the additional term did not exist?” After canvassing the relevant principles of contract law, Donald J.A, found in favour of the appellant, holding that the added handwritten term was enforceable.
[68] This interpretation is consistent with the rule that, in the absence of misrepresentation or fraud, a document proffered by one party and signed by the other establishes agreement between the parties about the terms contained therein.[^13] This is known as the rule in L’Estange v. F. Graucob Ltd., and is derived from a decision of that name by the English Court of Appeal in 1934.[^14] The rule applies whether or not the signing party has read the documents.[^15]
(iii) The Interpretation that accords most closely with sound commercial principles and good business sense
[69] The sellers argue that if the APS is interpreted in a way that gives JMB the exclusive right to terminate the agreement, the sellers would be prevented from selling their property indefinitely, and JMB would be entitled to refrain from terminating or completing the APS. JMB could thereby maintain a future interest in the property without ever having to buy it.
[70] The court avoids interpretations of a document that would result in a commercial absurdity. If the literal construction leads to an absurdity, repugnancy or inconsistency, which reasonable people cannot be supposed to have contemplated under the circumstances, it should, if possible, be modified so as to avoid such a result.[^16]
[71] The inclusion of the mutual termination clause does not result in a commercial absurdity. It simply means that JMB faced a deadline of March 10, 2015, for securing severance approval. In failing to meet that deadline, JMB risked losing the money it had expended in applying for severance, and in appealing from the dismissal of its application. This is not an absurdity. It is simply a risk that the wording imposed on JMB. It would be a more absurd result if JMB, by applying for severance on behalf of the sellers, secured for itself indefinite control over the sale of their property.
[72] JMB seeks to mitigate the negative impact of its alleged exclusive right to terminate on the sellers by asserting that it (JMB) was under a duty to pursue its application diligently. This does not relieve the fundamental unfairness of the alleged agreement to the sellers. It was the deadline of March 10, 2015, that required JMB to pursue its severance application diligently and that protected the sellers from undue delay. By inserting the date by which final severance approval was required, JMB acquiesced in that objective trigger for restoring the sellers’ right to dispose of their property to whomever they wished.
[73] JMB submits that its interpretation of the APS is supported by the fact that clause 6A of Schedule “A”, which required the sellers to appoint JMB as their agent for the purposes of the severance application, does not include any limitation as to the duration of this appointment. The APS also does not provide for any triggering event or mechanism for the removal of JMB as the sellers’ agent for the purposes of the severance application. JMB submits that Clause 6A did not provide for the sellers’ removal of JMB as their agent because JMB alone had the right to cease pursuing the severance application and terminate the APS if severance could not be obtained by March 10, 2015.
[74] A more reasonable explanation for the absence of a clause terminating JMB’s authority to act as the sellers’ agent beyond March 10, 2015, is that such a clause was not needed. JMB ceased to have any interest in pursuing the severance application once the APS was terminated. Its interest in the application derived solely from its interest in the property, which was assured only until March 10, 2015. Additionally, as noted below, its agency existed only in relation to the severance application, and did not extend to an appeal from a refusal of the severance application.
[75] The fact that JMB’s authority to act as the sellers’ agent in the severance application was of indefinite duration, while the sellers had the right to terminate the APS after March 10, 2015, did not give the sellers an unfair advantage over JMB. If JMB failed to secure severance approval in a timely manner despite its diligent efforts, it was entitled to terminate the APS itself, and cease pursuing its severance application. If, on the other hand, JMB, for any reason (other than one caused by the sellers), failed to obtain severance approval by March 10, 2015, there is no reason why the sellers should not also be entitled to terminate the APS and sell the part of the property that did not require severance approval, or sell the whole of the property to a buyer who was more likely to secure severance approval.
[76] JMB submits that the most commercially and objectively reasonable interpretation of the APS is that JMB was obligated to diligently pursue the required severance application and that, if it had failed to do so, the sellers would have been entitled to terminate the APS. On this interpretation, the onus would have been on the sellers to establish JMB’s lack of diligence, a formidable onus. It was more commercially reasonable to impose a fixed deadline on JMB, after which either party had the right to terminate the agreement. It was especially reasonable to grant this right to the sellers, as they were the owners of the property. It would not be commercially reasonable to impose a heavy evidentiary burden for them to meet in order to exercise their rights as owners to dispose of their property as they see fit.
[77] JMB argues, in effect, that it is commercially reasonable to interpret the APS as vesting in it the right to preserve its exclusive right to purchase the property until it exhausted all available appeals from the refusal of its application for severance. This right cannot be read into the APS, which attaches the right to terminate to the date of severance approval, not to the date of appeals from a refusal of a severance application.
[78] JMB’s interpretation of the termination clause as giving it the right to exhaust all available appeals is as commercially unreasonable as it would be to interpret a conventional Agreement of Purchase and Sale, which imposes the obligation to apply for severance on the seller, as requiring the seller to exhaust all available appeals, however unlikely they may be to succeed, before being relieved of their obligations under an agreement. As noted below, the courts have declined to impose such a broad obligation on sellers. It would be equally unreasonable to grant such a broad right to a buyer in the absence of unambiguous language in the agreement.
The limit of the obligation imposed on sellers to secure severance approval
[79] The Planning Act requires an Agreement of Purchase and Sale of Property to contain a severance clause whenever the property being sold is part of a larger parcel. Section 50 of the Act provides, in this regard:
Subdivision control
50.(3) No person shall convey land by way of a deed or transfer, or grant, assign or exercise a power of appointment with respect to land, or mortgage or charge land, or enter into an agreement of sale and purchase of land or enter into any agreement that has the effect of granting the use of or right in land directly or by entitlement to renewal for a period of twenty-one years or more unless,
(b) the grantor by deed or transfer, the person granting, assigning or exercising a power of appointment, the mortgagor or chargor, the vendor under an agreement of purchase and sale or the grantor of a use of or right in land, as the case may be, does not retain the fee or the equity of redemption in, or a power or right to grant, assign or exercise a power of appointment in respect of, any land abutting the land that is being conveyed or otherwise dealt with other than land that is the whole of one or more lots or blocks within one or more registered plans of subdivision;
(f) a consent is given to convey, mortgage or charge the land, or grant, assign or exercise a power of appointment in respect of the land or enter into an agreement in respect of the land;[^17] [Emphasis added.]
[80] The absence of a severance clause from an APS renders the agreement a nullity. The Act provides, in this regard:
50.(21) An agreement, conveyance, mortgage or charge made, or a power of appointment granted, assigned or exercised in contravention of this section or a predecessor thereof does not create or convey any interest in land, but this section does not affect an agreement entered into subject to the express condition contained therein that such agreement is to be effective only if the provisions of this section are complied with. [Emphasis added.]
[81] The APS in the present case contains the following severance provision:
- PLANNING ACT: This Agreement shall be effective to create an interest in the property only if Seller complies with the subdivision control provisions of the Planning Act by completion and Seller covenants to proceed diligently at Seller’s expense to obtain any necessary consent by completion. [Emphasis added.]
[82] Although paragraph 15 imposes the obligation to obtain severance approval on the Sellers, the parties agreed, in clauses 7 and 8 of Schedule “A”, that the Sellers would delegate their obligation to JMB. Those clauses provide:
- Severance of Property
The Buyer shall, at the Buyer’s cost and expense, seek a consent from the local consenting authority (the Consenting Authority) to the severance of the property from the Seller’s adjoining lands which are shown in blue on the attached Schedule “B” and are more particularly described as 3.5 hectares of McGibbon Point fronting on “Steamboat Channel” and shall be responsible for the application of such severance and the satisfaction at his sole expense prior to closing of all conditions of any consent given. The Buyer shall obtain the Seller’s approval to the severance application so that both the Buyer and the Seller can satisfy themselves that the application and the survey or sketch filed with it conform to the dimensions of the property as shown on Schedule “B”, and the Buyer shall keep the Seller reasonably informed of the status of the Buyer’s severance application. On or after January 2nd, 2015 March 10, 2015, the Buyer [or Sellers] may terminate this agreement by written notice [to each other] to the Seller if final severance approval has not yet been obtained. Final severance shall be the time at which all appeal periods in respect of the approved severance have expired.
- This Agreement shall be completed by no later than 5:00 p.m. on the 15^th^ Business day following final approval of the severance and following all public comment timelines have passed. Upon completion vacant possession of the property shall be given to the Buyer unless otherwise provided for in the Agreement.
[83] Under the Planning Act, the obtaining of severance approval is a “condition precedent” to the completion of an Agreement of Purchase and Sale. Where, as in most cases, the Agreement imposes the obligation to obtain severance approval on the Seller, the question arises as to when the Seller should be found to have complied with his obligation. That is, does the Seller’s obligation to make “reasonable efforts” to secure severance approval require him to appeal a decision from an adverse decision of the Planning Board to the OMB?
[84] Megarry J., of the English Court of Chancery in Wroth v. Tyler, in 1974, held that a vendor will usually not be required to embark upon difficult or uncertain litigation in order to secure the requisite consent.[^18] In Sola Developments Limited v. ICI Canada Inc. and John Doyle, in 2009, Justice Spence expressed a similar view on behalf of this Court.
[85] In Sola, the buyer sought specific performance of the Agreement of Purchase and Sale of the property owned by ICI, or damages for the Seller’s refusal to sell. The Agreement required the seller to obtain severance approval. The Planning Board was prepared to give its approval, but attached conditions that ICI considered unreasonable. ICI therefore did not proceed with its application, and instead terminated the agreement. Justice Spence held that ICI had not breached the Agreement. He found that ICI’c concerns regarding the conditions imposed by the Planning Board were reasonable:
These concerns are reasonable business concerns. There is no basis for a conclusion that ICI was overreacting in not being prepared to proceed with obtaining a consent on these terms. ICI’s evidence was that it did not consider proceeding and then appealing to the Ontario Municipal Board because it was not in a position to be confident that it would succeed on such an appeal. This concern is also reasonable. [Emphasis added.][^19]
[86] This is not a case like John E. Dodge Holdings Ltd. v. 805062 Ontario Ltd., in 2001, in which the seller was granted severance, and the issue was whether he was required to comply with the conditions that the Committee of Adjustments had imposed, or appeal to the OMB to have the conditions removed.[^20] In such a case, the Court of Appeal has noted that the statutory scheme provided by the Planning Act does not end with the decision of the Committee, and that if the vendor believes that a condition that the Committee has imposed is unreasonable, it has the right to appeal to the OMB and a further right to have the decision reviewed by the Divisional Court.[^21]
[87] A seller, in some circumstances, may be required to appeal from a severance refusal by a Planning Committee or Committee of Adjustments severance to the OMB in order to comply with his contractual obligation to make reasonable efforts to secure approval. However, it does not follow from this fact that a buyer has the right in all circumstances to exhaust all its appeals before the seller is restored to its right to sell the property to another. A seller’s contractual obligation to obtain severance approval places the onus on it to justify abandoning its efforts. A buyer, on the other hand, must establish that it has a contractual right to exhaust its appeals before the seller may sell its property to another.
[88] In the present case, there is evidence that the Town Planner recommended approval of JMB’s severance application, and JMB speculates that it was only the opposition of the sellers’ neighbours, who wished to buy the property themselves, that resulted in the Planning Board’s refusal of its application. The evidence falls short of establishing that the Planning Board’s decision was unreasonable, or that JMB’s appeal to the OMB was likely to succeed. The Official Plan allowed for division of the property into at least three lots. The Area Planning Board, in its decision to refuse JMB’s application, gave as its reason that the severance would not create appropriate land use. There is no evidence as to what land use the seller’s neighbours, represented by the Land Trust, would have proposed, or whether this would have addressed the Planning Board’s concerns.
[89] The APS in the present case does not give JMB the right to exhaust all of its appeals from a refusal of severance. Rather, it imposes a time limit on its efforts to obtain such approval, by providing that the right to terminate the agreement arises if final severance approval has not been obtained by March 10, 2015. It was for this reason that JMB sought to extend the deadline for obtaining such approval beyond March 10, 2015, when its appeal to the OMB was not to be heard until March 31st. The sellers were within their rights to refuse JMB’s request. JMB was not entitled to insist unilaterally on pursuing its appeal to the OMB and, if necessary, to the Divisional Court or higher courts and prevent the sellers from selling the property until it did so.
c) Are 214 and the Estate estopped from terminating the APS?
[90] JMB argues that the sellers, by permitting JMB to apply on their behalf for severance, and to appeal, at JMB’s expense, from the Planning Board’s refusal of its application, are estopped from arguing that JMB does not have the exclusive right to terminate the APS, as JMB would not have made its application for severance, or appealed from the refusal of its application, unless it had that exclusive right.
[91] Whatever representation the sellers implicitly made to JMB by authorizing it to apply for severance on their behalf ceased to have effect when JMB’s application was refused by the Planning Board. The Agency Agreement that the sellers signed authorized JMB to apply for severance, not to appeal from a refusal of severance. The argument that the sellers’ authorization to JMB to apply for severance necessarily included an authorization to appeal from a refusal of its application is untenable. It is equivalent to arguing that retaining a lawyer to defend a client on a criminal charge implies a continued retainer to appeal from an adverse verdict.
[92] JMB asserts that it pursued the severance for over a year. It submits that if it diligently pursued the severance, but found that it took an unexpectedly long time, as it says occurred, it should have the exclusive option either to continue to pursue the severance or to terminate the Agreement. It submits that recognizing such a right in JMB would not adversely affect the sellers, since they would have to wait for the severance, in any event, before selling the property to another buyer.
[93] JMB’s argument is untenable for two reasons. First, JMB had the right to discontinue its pursuit of the severance application at any time. It was not necessary to give it control over the sale of the property in order to relieve it of the further expense of pursuing an appeal to the OMB. Second, JMB had greater control than the Sellers over the speed at which the severance application proceeded. It was therefore reasonable to impose a deadline after which the Sellers would be restored to their right to sell the property to a buyer who offered the best prospect of securing timely approval of the severance.
[94] JMB’s application for severance approval was unsuccessful, whether because the sellers’ neighbours opposed the application, or for other reasons. There is no evidence that the sellers colluded with the neighbour’s opposition to the application, or otherwise intentionally sabotaged JMB’s application. It would not be reasonable to penalize the sellers for JMB’s failure to secure approval by extending the period within which the sellers were precluded from selling to another buyer. The deadline of March 10, 2015, was a commercially reasonable means of balancing the sellers’ rights with those of JMB as buyer.
[95] JMB asks the court to infer from the disadvantage it derived from the mutual termination clause that JMB, in fact, rejected it. It argues that the court should conclude from the fact that JMB derived a benefit from the exclusive right to terminate the contract after March 10, 2015, that it did not assent to a mutual termination clause, which gave both parties the right to terminate the APS after that date. Accepting this argument would result in interpreting the APS according to the parties’ subjective intentions rather than according to its plain language.
[96] A literal meaning is not applied where doing so would bring about an unrealistic result, or a result that would not be contemplated in the commercial atmosphere in which the contract was negotiated. Where words may bear two constructions, the more reasonable one, which produces a fair result, must be taken as the interpretation which would promote the intention of the parties. An interpretation that defeats the intentions of the parties in entering in the commercial transaction in the first place should be discarded in favour of one that promotes a sensible commercial result.[^22]
[97] JMB argues that the sellers would not be harmed by its having an exclusive right to terminate the APS because the sellers would not be able to sell the property to other buyers without the required severance approval. This argument overlooks the fact that the sellers could be more successful than JMB in securing severance approval, if for no other reason than their application might have the support of their neighbours if they intended to sell to the neighbours and not to JMB. Additionally, an application for severance to permit sale to a buyer with plans that offered a better prospect of good land use than JMB’s plans might be more successful, or result in speedier approval, than JMB’s application.
[98] JMB submits that the sellers are not seeking to terminate the APS because JMB’s efforts to secure severance approval are taking too long but because they “have found another purchaser for the Property, and cannot proceed due to the [Certificate of Pending Litigation].” The evidence does not support a finding as to the sellers’ motivation for terminating the APS. In any event, their motivation is not relevant. Either they have the right to terminate the APS or they do not.
i. Promissory/Equitable Estoppel
[99] JMB submits that the doctrine of promissory estoppel, being a form of equitable estoppel, supports its right to complete its appeal to the OMB before either party may terminate the APS. It argues that the sellers, by their conduct in allowing JMB to pursue its application for severance and its appeal from refusal, with the expenses those proceedings entailed, promised or represented to JMB that they would not terminate the APS until JMB had exhausted its remedies from the refusal of its application. For the reasons that follow, I disagree.
[100] The requirements of promissory estoppel are as follows:
A promise;
Reliance on that promise;
The reliance was detrimental; and
The principles of equity require the enforcement of the promise.[^23]
[101] The Ontario Court of Appeal stated, in Owen Sound Public Library Board:
[A] promise, whether express or inferred from a course of conduct, is intended to be legally binding if it reasonably leads the promisee to believe that a legal stipulation, such as strict time of performance, will not be insisted upon.[^24]
[102] JMB argues that the sellers promised, in the APS, to allow it to pursue the severance application to its conclusion, by not including in the Authorization any end date or mechanism for removing JMB as their agent for the purposes of the severance application, and by allowing JMB to begin its appeal to the OMB without any warning that they considered themselves authorized to terminate the APS on March 10, 2015.
[103] JMB further argues that it relied on the sellers’ promise to its detriment. It says that it expended time and substantial funds on retaining legal counsel and professional planners, and incurred other costs of preparing for the OMB appeal hearing, and that it will forfeit those amounts if the APS is terminated before the appeal is heard. It says that it would not have incurred the expenses it did had it believed the sellers could terminate the APS before the OMB appeal was heard, as JMB had no control over the length of the appeal process.
[104] JMB argues that the principles of equity support the enforcement of the sellers’ promise and allowing JMB to complete its appeal to the OMB before the sellers are permitted to sell the property to another buyer. It reiterates that doing so will not harm the sellers, who will require severance approval regardless of who buys the property, and obtaining such approval for a sale to another buyer will almost certainly lead to further delay in securing severance approval.
[105] There is no evidence to support a determination that the sellers are equitably estopped from terminating the APS. In particular:
There is no evidence that the sellers represented that they would not exercise their right to terminate the APS if final severance approval was not obtained by March 10, 2015. While the APS imposed an obligation on JMB to keep the sellers apprised of the progress of its application for severance, there is no evidence that JMB complied with this obligation. The only evidence that the sellers knew that the Planning Board had refused JMB’s application, which occurred in October 2014, is that their lawyer received an e-mail from JMB’s lawyer on February 25, 2015, advising him that a neighbor had objected to the severances, and that an OMB hearing was set for March 30, following a refusal by the municipality’s Land Division Committee to grant the severances. The purpose of the call was to request an extension of the transaction until after the OMB made its decision, and after the appeal period following such a decision had passed and surveys had been obtained.
There is no evidence that JMB relied on a promise or representation by the sellers not to terminate the APS if final severance approval was not obtained by March 10, 2015. JMB intended to make its application for severance from the time it entered into the APS. It did not rely on such a promise when it appealed from the refusal of its application for severance because it had not communicated to the sellers that its application had been refused or that it was undertaking an appeal until February 25, 2015, shortly before the appeal hearing was adjourned.
[106] I find no evidence to support JMB’s argument of promissory or equitable estoppel. I find that the principles of equity favour the sellers’ right to terminate the APS. They do not favour JMB’s right to impede the sellers’ right to sell their property until JMB has exhausted all of its appellate remedies from the refusal of its application.
d) Is JMB entitled to specific performance of the APS?
[107] The sellers argue that if JMB prevails in its interpretation of the APS, it will result in specific performance, because JMB will then be entitled to specific performance. I do not agree.
[108] JMB does not seek specific performance. It seeks a declaration as to who has the right to terminate the APS. If the court upholds its interpretation of the APS, and the sellers are found to have breached the terms of the APS, the appropriate remedy will be dealt with at that time. At this point, JMB does not seek either outcome, but simply an order clarifying the terms of APS.
[109] Specific performance is granted only if the subject property is unique in the sense that a substitute does not exist or would not be readily available. The uniqueness of the property relates to its proposed use. It must render the property uniquely suitable for the purpose for which it was intended.[^25] JMB does not allege that the property possesses this character.
e) Are 214 and the Estate entitled to a discharge of the Certificate of Pending Litigation?
[110] The court may order the discharge of a certificate of pending litigation where the party at whose instance it was issued does not have a reasonable claim to the interest in the land, or on any other ground that is considered just.[^26] I find that JMB does not have a reasonable claim to an interest in the property. The certificate of pending litigation shall therefore be ordered discharged.
CONCLUSION AND ORDER
[111] For the foregoing reasons, it is ordered that:
The APS entitled 2144032 Ontario Inc. and Thomas Kaufman, Estate Trustee of the Estate of William H. Kaufman, to terminate the agreement when final severance approval was not obtained by March 10, 2015.
J.M.B. Cattle Corp.’s application is dismissed.
The Certificate of Pending Litigation shall be discharged.
If the parties are unable to agree on costs, they may make written submissions. The respondents shall make their submissions by December 15, 2015. The applicant shall make its submissions by December 31, 2015.
Price J.
Released: November 25, 2015
COURT FILE NO.: 15 – 086 (Owen Sound)
DATE: 2015-11-25
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
J.M.B. CATTLE CORP.
Applicant
- and -
2144032 ONTARIO INC. &
THOMAS KAUFMAN, ESTATE TRUSTEE OF THE ESTATE OF WILLIAM H. KAUFMAN
Respondents
REASONS FOR ORDER
Price J.
Released: November 25, 2015
[^1] Rules of Civil Procedure, R.R.O. 1990, Reg. 194, Rule 14.05(3)(d) and (e).
[^2] UBS Securities Canada, Inc. v. Sands Brothers Canada, Ltd., 2009 ONCA 328, 95 O.R. (3d) 93, at para. 47.
[^3] Olivieri v. Sherman, 2007 ONCA 491, 86 O.R. (3d) 778, at para. 44, citing Corpus Juris Secundum, vol. 13, at 265.
[^4] UBS Securities Canada, Inc., supra, at para. 49.
[^5] Harvey v. Perry, 1953 64 (SCC), [1953] 1 S.C.R. 233; Pyne v. Footman, 2008 ONCA 451.
[^6] B. Zar Enterprises Corp. v. Hitchen, [1982] B.C.J. No. 1502 (S.C.), at para. 18.
[^7] Walton v. Landstock Investments Ltd., 1976 669 (ON CA), 13 O.R. (2d) 693 (C.A.), 1976 CarswellOnt 811, at para. 9 [cited to CarswellOnt], leave to appeal to S.C.C. refused, Dec. 20, 1976; Ball v. Hardy (2006), 2006 23140 (ON CA), 212 O.A.C. 240, at para. 7.
[^8] Logikor v. Bessey Tools Inc., 2013 ONSC 5052, at para. 29.
[^9] Ventas, Inc. v. Sunrise Senior Living Real Estate Investment Trust, 2007 ONCA 85, 85 O.R. (3d) 254, at paras. 24, 45, and 50.
[^10] Charlton v. Canada Post Corporation, 2009 1647 (Ont. S.C.), at para. 74.
[^11] UBS Securities Canada, Inc. v. Sands Brothers Canada, Ltd., supra, at para. 47.
[^12] G.H.L Fridman, The Law of Contract in Canada, 6th ed, (Toronto: Carswell, 2011), at pp. 59-60; Butler Machine Tool Co. v. Ex-cell-O Corporation (England), [1979] 1 All E.R. 965 (C.A.); Cariboo-Chilcotin Helicopters Ltd. v. Ashlaur Trading Inc., 2006 BCCA 50.
[^13] John D. McCamus, The Law of Contracts, 2d ed., (Toronto: Irwin Law, 2012), at p.193.
[^14] L’Estange v. F. Graucob Ltd., [1934] 2 K.B. 394 (Eng. C.A.).
[^15] McCamus, The Law of Contracts, supra, at p. 193.
[^16] Toronto (City) v. W.H. Hotel Limited, 1966 8 (SCC), [1966] S.C.R. 434, at p. 440.
[^17] Planning Act, R.S.O. 1990, c. P.13, s. 50(3).
[^18] Wroth v. Tyler, [1974] Ch. 30, [1973] All E.R. 897, at p. 50 [Ch.].
[^19] Sola Developments Limited v. ICI Canada Inc., 2009 14049 (Ont. S.C.), at para. 53.
[^20] John E. Dodge Holdings Ltd. v. 805062 Ontario Ltd. (2001), 2001 28012 (ON SC), 56 O.R. (3d) 341 (S.C.), appeal dismissed, 2003 52131 (ON CA), 63 O.R. (3d) 304 (C.A.), application for leave to appeal to the S.C.C. dismissed Nov. 6, 2003.
[^21] John E. Dodge Ltd. v. 805062 Ontario Ltd. (2003), 2003 52131 (ON CA), 63 O.R. (3d) 304 (C.A.), at para. 27.
[^22] Consolidated-Bathurst v. Mutual Boiler, 1979 10 (SCC), [1980] 1 S.C.R. 888, at p. 901.
[^23] Owen Sound Public Library Board v. Mial Developments Ltd. et al. (1976), 1979 1624 (ON CA), 26 O.R. (2d) 459, 1979 CarswellOnt 643 (C.A.), at para. 15 [cited to CarswellOnt].
[^24] Owen Sound Public Library Board, supra, at para. 16
[^25] John E. Dodge Holdings Ltd. v. 805062 Ontario Ltd. (2003), 2003 52131 (ON CA), 63 OR. (3d) 304 (C.A.), at paras. 38-40.
[^26] Courts of Justice Act, R.S.O. 1990, c. C.43, s. 103(6), as am.; Rules of Civil Procedure, Rule 42.02.