Court File and Parties
COURT FILE NO.: CV-17-0175-00 DATE: 20170324
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: 2526716 ONTARIO INC., Plaintiff AND 2014036 ONTARIO LIMITED and 2014037 ONTARIO LIMITED, Defendants
BEFORE: EMERY J.
COUNSEL: Gerard Barosan, for the Plaintiff (responding party) Tracy Nanziri, for the Defendants (moving parties)
HEARD: March 10, 2017
ENDORSEMENT
[1] The defendants are the owners of two adjacent pieces of rural property in the Township of Adjala/Tosorontio, just southwest of Barrie in the County of Simcoe (jointly, the “properties”). The defendants are the sellers of the properties to the plaintiff as the purchaser under an Agreement of Purchase and Sale dated June 2, 2016. They bring this motion under section 103 (6) of the Courts of Justice Act to discharge a certificate of pending litigation (the “CPL”) registered against title to each of the properties. The CPL was obtained by the plaintiff with leave granted by Justice Bloom on January 16, 2017.
[2] The defendants seek to discharge the CPL on the basis that the plaintiff is not entitled to a CPL on two grounds. First, they submit that the plaintiff’s motion for the CPL before Justice Bloom did not meet the test for leave to obtain the CPL in the first place. Second, they argue that the plaintiff is not entitled to the continued registration of the CPL against title to the properties on the all of the equities between the parties, based on the evidence filed on this motion.
Background
[3] A previous operator had operated the properties as a gravel pit during the defendant’s ownership. That operator carried on the business of extracting gravel from mines on the properties under an operating licence from the Ministry of Natural Resources under the Aggregate Resources Act.
The Agreement of Purchase and Sale
[4] In the initial Agreement of Purchase and Sale, 2033914 Ontario Limited was shown as the buyer, and 2014037 Ontario Limited was shown as the seller. In an amendment to the Agreement of Purchase and Sale, the plaintiff 2526716 Ontario Inc. became the purchaser and both defendants 2014036 Ontario Limited and 2014037 Ontario Limited became the sellers of the properties. These facts are not in dispute.
[5] Pursuant to the Agreement of Purchase and Sale, the plaintiff as purchaser agreed to purchase the property for $1,200,000. The plaintiff paid a deposit of $75,000, to be held by the lawyer for the defendants in trust.
[6] The parties agreed on the first page of the Agreement of Purchase and Sale that the sale under the agreement would be completed on October 31, 2016. However, the following clause (referred to hereafter as the “20 day clause”) is included in Schedule A which forms part of the Agreement of Purchase and Sale:
Notwithstanding the closing and completion date mentioned in this Agreement of Purchase and Sale, the closing of the agreement will take place 20 days after obtaining all the necessary licenses, permit and further obtaining clearance from Ministry of Natural Resources and the City of Adjala/Tosorontio to refill, to rehabilitating the land to agricultural use.
[7] Schedule A further provides that:
SELLER WARRANTS THAT SELLER WILL HAVE THE PERMIT FROM MINISTRY OF NATURAL RESOURCES TRANSFERRED ON THE PURCHASER OPERATING CORPORATION NAME, FOR THE PURCHASER TO OPERATE THE PIT INDEPENDENTLY AFTER COMPLETION OF THIS AGREEMENT OF SALE AND PURCHASE. PURCHASER WILL NEGOTIATE WITH THE CITY OF TECUMSEH ONTARIO, FOR ANY OTHER TERMS AND CONDITIONS FOR SUCCESSFUL OPERATION AND REHABILITATION ION (SIC) OF THIS PIT ACCORDINGLY.
[8] At the time the Agreement of Purchase and Sale was entered, the principals of the defendants, Joachim Wappler did not possess a license to operate the gravel pit on the property. The operating license was at the time in the name of the previous operator.
[9] When the Agreement of Purchase and Sale was entered, the 20 day clause in Schedule A was included to provide flexibility for the parties to close after Mr. Wappler obtained the operating license. This flexibility would enable the parties to close and for Mr. Wappler to assign the operating license to the principal for the plaintiff.
[10] On October 31, 2016, the parties amended the Agreement of Purchase and Sale to delete the closing date of October 31, 2016, and to substitute it with the following:
“COMPLETION DATE: TO BE DECIDED BY BUYERS AND SELLERS SOLICTORS WITHIN 48 HOURS (SIC) FROM THE DATE AND TIME, AND TIME, BUYER RECEIVING THE COMPLETED AND SIGNED “APPLICATION FOR THE TRANSFER OF LICENSING” FROM THE SELLER FOR THE REHABILITATION OF THE CATALINA PIT [The Property].”
[11] The plaintiff intends to fill in the mine pits with construction and other soil and materials from offsite sources. It anticipates that the property will generate significant revenues when it has been developed. The plaintiffs intended use for the property was communicated to Mr. Wappler prior to execution of the Agreement of Purchase and Sale.
[12] Given the location of the property, the property is desirable for rezoning, development and use for commercial and residential purposes.
[13] An operating license for a gravel pit is granted to, and can only be transferred between persons, and not corporations. Therefore, Mr. Wappler was waiting for the transfer of the operating license from the previous operator of the properties before he would be in a position to complete the sale of the properties to the plaintiff.
[14] Mr. Wappler had not yet received the transfer of the operating license from the previous operator by October 31, 2016.
[15] It was important for the plaintiff to ensure that its principal received the transfer of the operating license from Mr. Wappler because of its intended plans for the property. According to the plaintiff, the property is unique in character. The plaintiff states that it will be unable to obtain a similarly situated property of equal quality, price and intrinsic value, and that it is specifically suited the plaintiff’s intended use.
[16] In order for the plaintiff to pursue its plans and to implement the intended use for the property, the property must be rehabilitated. This rehabilitation will require the filling in of the mine pits on the property. Rehabilitating the property will require rehabilitation approval from the Township. However, the Township does not have authority to grant the plaintiff’s application for rehabilitation approval until the Ministry of Natural Resources (“MNR”) is satisfied with the condition of the property, and issues a letter to decommission the property. This decommissioning letter is also known as the “MNR Clearance”.
[17] The plaintiff has filed evidence that in order to obtain the MNR clearance, MNR shall require that various procedures take place at the property, such as grating, flattening and the redistribution of soil. The MNR protocol includes the issuing of a site plan that contains specific instructions as to how these procedures are performed (the “site planning”).
[18] According to the evidence filed by the plaintiff, MNR only allows a person who has been granted an operating license for the mine to carry out the work required by a site plan. Since Mr. Wappler did not hold an operating license for the mine at the time the parties entered the APS, they were not in a position to complete the sale until the previous owner transferred the operating license to him. Once the operating license had been transferred to Mr. Wappler, he could carry out the requirements of the site plan himself and arrange to have the MNR clearance issued to him. Otherwise, he could transfer the operating license to the individual representing the plaintiff, who could then perform the tasks at the site plan and apply for the MNR clearance.
[19] Mr. Wappler did not receive the transfer of the operating license into his name until November 7, 2016. He then endorsed an application to further transfer the license into the name of the individual representing the plaintiff, and sent this application to the plaintiff’s lawyer on or about November 17, 2016.
[20] Shangara Mand is the officer and director of 2526716 Ontario Inc., the plaintiff in this action and the purchaser under the APS. In an affidavit filed by Mr. Mand sworn on January 13, 2017 in support of the motion to obtain the CPL, Mr. Mand deposes that the defendants demanded the return of this application to transfer the operating license on or about December 21, 2016 after a dispute arose regarding the completion of the agreement. The facts arising between November 17 and December 21, 2016 arose from the amendment dated October 31, resulting in the stalemate between the parties.
[21] When David Brannan, the solicitor for the defendants, wrote to Mr. Burych, the lawyer for the plaintiff, on November 17, 2016. In his letter, Mr. Brannan enclosed the application for the transfer of the operating license, and invited Mr. Burych to contact Linda of his office to arrange a closing date for the transaction.
[22] The lawyers at the Burych firm representing the plaintiff on the purchase would not agree to a closing date because they took the position that the condition with respect to the rehabilitation of the properties had not yet been fulfilled.
[23] What followed can only be described as a war of letters between the lawyers representing each party. In those letters, each lawyer engaged in advocating the positions of their clients and taking positions on when a closing date could be scheduled that only worked to entrench the other party in theirs. These letters are described and attached in Mr. Wappler’s second affidavit sworn on February 6, 2017, and the affidavit of Mr. Mand sworn in support of the CPL on January 13, 2017.
[24] Mr. Brannan subsequently wrote to Mr. Burych and to Mr. Teplinsky at the Burych firm on November 23, 2016 in which he indicated his clients’ belief that December 7, 2016 would be a reasonable date to set as the closing date for the transaction. In that letter, he stated that all other terms and conditions to remain the same and time to remain of the essence. Mr. Brannan’s letter indicates that his client’s took the position that the amendment of October 31, 2016 dictated a new method of establishing a closing date, and overrides the 20 day clause in Schedule “A” to the Agreement.
[25] Mr. Brannan stated in this letter that as the license transfer had now been provided in accordance with the amendment, it was necessary to establish a reasonable closing date.
[26] There was no evidence before the court that a completion date had been decided or agreed upon by both the lawyers for the buyers and the lawyers for the seller.
[27] Mr. Teplinsky wrote a letter back to Mr. Brannan on November 23, 2016 to set out the plaintiff’s position that the amendment on October 31, 2016 simply deleted the completion date from section 2 on the first page of the APS, and did not address the 20 day clause in Schedule A. Mr. Teplinsky therefore concluded that the mechanism to close the agreement provided in Schedule A therefore remained unaltered, and that the transaction would close 20 days after the specified permits, licences and clearances had been obtained from the Township of Adjala/Tosorontio and the Ministry of Natural Resources.
[28] Mr. Teplinsky concluded this letter by setting out the plaintiff’s position that the amendment is to be read together with the unamended portions of the APS, so that the completion date would be set by the lawyers for the parties once the sellers had delivered the application to transfer the operating license and once the purchaser had obtained the MNR clearance. As the purchaser was currently in the process of obtaining those permits and approvals, Mr. Teplinsky stated that he could not set a closing date for the transaction at that time.
[29] Mr. Brannan sent a letter back to Mr. Teplinsky at 5:08 p.m. on November 23, 2016 to advise him that the closing date of December 7, 2016 he had proposed is reasonable as the closing date for the transaction. As in his first letter to Mr. Teplinsky earlier that day, Mr. Brannan repeated that all other terms and conditions would remain the same, and time would remain of the essence. He then went on to state that in the event that the purchaser failed to close the transaction on that date, the deposit would be forfeited and the purchaser would be responsible for any and all damages, costs and expenses suffered by the sellers as a result of the breach.
[30] Mr. Teplinsky wrote back later the same day to advise that he did not accept Mr. Brannan’s interpretation of the amendment on October 31. At the end of his letter, Mr. Teplinsky stated that our client (the purchaser) intends to complete this transaction.
[31] On November 29, 2016, Mr. Brannan wrote to Mr. Teplinsky to advise him that while his client felt that December 7 was a reasonable closing date, his client was agreeable to extending the closing of the transaction to December 21, 2016. Again, Mr. Brannan confirmed in this letter that all other terms and conditions to remain the same and time to remain of the essence.
[32] Mr. Teplinsky responded in his letter dated December 8, 2016 to advise that the position Mr. Brannan set out on behalf of the seller would not bring the parties closer to an agreement. In that letter, Mr. Teplinsky described how the purchaser had been in lengthy discussions with the Township and the Ministry of Natural Resources to receive approval for its development plan. Mr. Teplinsky again reaffirmed that his client wishes to complete the purchase of the property once it has received the necessary approvals from the Township and the Ministry of Natural Resources.
[33] Mr. Brannan emailed Mr. Teplinsky on December 20, 2016 to inform him of his view that the plaintiff was in anticipatory breach of the APS because it would not close the purchase of the properties on December 21, 2016. Mr. Brannan therefore concluded on behalf of the defendant sellers that the APS with the plaintiff was at an end, the plaintiff’s deposit of $75,000 was forfeited and that the defendants were at liberty to resell the properties.
Commencement of the Litigation
[34] 2526716 Ontario Inc. commenced this action on January 13, 2017. In the Statement of Claim, the plaintiff seeks the declaration that the Agreement of Purchase and Sale is a binding agreement, a declaration that the defendants had breached the Agreement and an order for specific performance of the Agreement. The plaintiff also seeks an order granting the plaintiff leave to issue and register the CPL against title to the properties.
[35] Elsewhere in the prayer for relief, the plaintiff seeks an order that the defendants pay to the plaintiff damages in the sum of $2 million for breach of contract in addition to, or in lieu of, an order for specific performance.
[36] The defendant brought their motion for summary judgment to dismiss the action on the basis that the Agreement of Purchase and Sale with the plaintiff had come to an end. In that motion, the defendants seek an order discharging the CPL.
[37] On November 29, 2016, Justice Donohue adjourned the motion for summary judgment to April 28, 2017 to be heard as a long motion. However, that part of the motion for an order discharging the Certificate of Pending Litigation was adjourned at the defendants’ request to March 9, 2017 to be heard as a regular motion. It is that part of the motion I am deciding in these reasons.
Analysis
[38] The defendants bring this motion to discharge the CPL granted by Justice Bloom under section 103(6) of the Courts of Justice Act. For completeness, section 103(6) reads as follows:
Order discharging certificate
(6) The court may make an order discharging a certificate,
(a) where the party at whose instance it was issued,
(i) claims a sum of money in place of or as an alternative to the interest in the land claimed,
(ii) does not have a reasonable claim to the interest in the land claimed, or
(iii) does not prosecute the proceeding with reasonable diligence;
(b) where the interests of the party at whose instance it was issued can be adequately protected by another form of security; or
(c) on any other ground that is considered just, and the court may, in making the order, impose such terms as to the giving of security or otherwise as the court considers just.
[39] The defendant’s seek an order discharging the CPL because there is a new purchaser for the property. Section 103(7) provides that where a certificate is discharged, a person may deal with the land as fully as if the certificate had not been registered. It would appear that the CPL, and the claim of the plaintiff to an interest in land pursuant to its APS stands in the way of any resale or intention of the defendants to resell the properties to a new purchaser.
[40] The defendants ask the court for an order discharging the CPL on the basis that the plaintiff claims the sum of money in place of, or as an alternative to the interest in land claimed, or does not have reasonable claim to the interest in the land claimed because it has not completed the Agreement of Purchase and Sale under section 103 (6) (a) (i) and (ii). The defendants also submit that the court should discharge the CPL on any other ground that it considers just under subparagraph (c).
[41] The defendants do not request relief in their Notice of Motion for the discharge of the CPL because the interests of the plaintiff can be adequately protected by another form of security under subparagraph (b). No such security in another form has been proposed by the defendants in the evidence. I do not consider that relief to be proposed or available to the defendants on this part of the motion.
[42] The moving party for an order to discharge a CPL bears the burden of proof: 931473 Ontario Ltd. v. Coldwell Banker Canada Inc., (1991), 5 C.P.C. (3d) 328 (Gen. Div.).
[43] The test on a motion to discharge a CPL is the same as the test on a motion for leave to issue a CPL made on notice to the defendants in the first place: Home Builder Inc. v. Man-Sonic Industries Inc., 1987 Carswell Ont. 499 (Ontario Master).
[44] The Divisional Court in Clock Investments Ltd. v. Hardwood Estates Ltd., 16 O.R. (2n) 671 characterized the authority of the court to discharge a CPL as a discretionary exercise of power. The court in Clock Investments held that on the hearing of a motion to discharge a CPL, the court should consider all of the matters relating to the parties and the case when exercising the discretionary power given to make an order.
[45] I have the benefit of two decisions that are often followed on motions to discharge a CPL, which I find to be most helpful when articulating the factors to apply.
[46] The first case is the decision of Master Glustein, as he then was, in Perruzza v. Spatone, 2010 ONSC 841. In paragraph 20 of Perruzza, Master Glustein sets out the following legal principles that have been followed repeatedly by this court:
(i) The test on a motion for leave to issue a CPL made on notice to the defendants is the same as the test on a motion to discharge a CPL (Homebuilder Inc. v. Man-Sonic Industries Inc., 1987 CarswellOnt 499 (S.C. – Mast.) (“Homebuilder”) at para. 1);
(ii) The threshold in respect of the “interest in land” issue in a motion respecting a CPL (as that factor is set out at section 103(6) of the Courts of Justice Act, R.S.O. 1990, c. C. 43) is whether there is a triable issue as to such interest, not whether the plaintiff will likely succeed (1152939 Ontario Ltd. v. 2055835 Ontario Ltd., 2007 CarswellOnt 756 (S.C.J.), as per van Rensburg J., citing Transmaris Farms Ltd. v. Sieber, [1999] O.J. No. 300 (Gen. Div. – Comm. List) at para. 62);
(iii) The onus is on the party opposing the CPL to demonstrate that there is no triable issue in respect to whether the party seeking the CPL has “a reasonable claim to the interest in the land claimed” (G.P.I. Greenfield Pioneer Inc. v. Moore, 2002 CarswellOnt 219 (C.A.) at para. 20);
(iv) Factors the court can consider on a motion to discharge a CPL include (i) whether the plaintiff is a shell corporation, (ii) whether the land is unique, (iii) the intent of the parties in acquiring the land, (iv) whether there is an alternative claim for damages, (v) the ease or difficulty in calculating damages, (vi) whether damages would be a satisfactory remedy, (vii) the presence or absence of a willing purchaser, and (viii) the harm to each party if the CPL is or is not removed with or without security (572383 Ontario Inc. v. Dhunna, 1987 CarswellOnt 551 (S.C. – Mast.) at paras. 10-18); and
(v) The governing test is that the court must exercise its discretion in equity and look at all relevant matters between the parties in determining whether a CPL should be granted or vacated (931473 Ontario Ltd. v. Coldwell Banker Canada Inc., 1991 CarswellOnt 460 (Gen. Div.); Clock Investments Ltd. v. Hardwood Estates Ltd., 1977 CarswellOnt 1026 (Div. Ct.) at para. 9).
[47] The second is the decision of Master Donkin in 572383 Ontario Inc. v. Dhunna, 1987 CarswellOnt 551, to which Master Glustein refers in his discussion of the factors for the court to consider in Perruzza. The factors set out by Master Donkin are often described as the “Dhunna factors” and applied by the court regularly to determine the equities between the parties on a motion for leave, or a motion to discharge, with respect to a certificate of pending litigation.
[48] The practical approach on a motion to discharge a CPL is to first determine if there is a triable issue as the threshold question mandated by Clock Investments. If and when this threshold question has been answered to the satisfaction of the court, the equities on all matters between the parties may then be considered for the exercise of the court’s discretion on a principled basis as to whether a certificate should be allowed or discharged.
Triable Issue
[49] There is no dispute on the evidence that the plaintiff and the defendants are the ultimate purchaser and sellers respectively in the Agreement of Purchase and Sale originally entered on or about June 2, 2016.
[50] The dispute arises from the amendment made by the parties to the Agreement of Purchase and Sale on October 31, 2016 to delete the closing date of October 31, 2016 and to substitute it with another clause. The defendants maintain that this new clause overrides both the closing date specified on the first page of the original APS, and the 20 day clause found in Schedule “A” to the Agreement. The defendants argue that the plaintiff would not agree to a closing date within 48 hours of receiving the completed application for the transfer of the operating license signed by Mr. Wappler, and that the agreement is at an end. Accordingly, the plaintiff no longer has an interest in the property.
[51] The plaintiff maintains that the amendment on October 31, 2016 only replaced the closing date shown on the first page of the APS, and leaves the 20 day clause in Schedule “A” to the APS undisturbed. The plaintiff argues that the 20 day clause is not invoked until all necessary licenses, permit and clearance from the Ministry of Natural Resources and the municipality to rehabilitate the land to agricultural use is obtained. Since the MNR clearance has not yet been received, the 20 day clause in Schedule “A” of the original agreement has not been triggered. Accordingly, the APS remains binding and valid as between the parties, and gives the plaintiff an interest in land.
[52] I am not required to make any findings of fact, or to decide any questions of law that would determine the rights and obligations of the parties one way or another. That task is better left to the presiding judge who hears the motion for summary judgment on April 28, 2017. All that I must determine is whether, on the evidence before the court on the motion, there is a triable issue.
[53] It is my view that the language used by the parties in the 20 day clause, supported by the clause that follows it in capital letters, that the purchaser must negotiate with the Town of New Tecumseh for the rehabilitation of the pit, provides a reasonable basis for the plaintiff to argue that setting a closing date would be premature. The evidence given on the motion suggests that plaintiffs may well require MNR clearance before the 20 day clause is triggered to complete the transaction.
[54] The question is complicated by the language used by the parties in the amendment on October 31, 2016 that specifically deletes the closing date of October 31, 2016, and substitutes it with the 48 hour clause.
[55] The amendment on October 31, 2016 may only relate to that part of the Agreement of Purchase and Sale that relates to the specific date of October 31, 2016 setting out the closing date on the first page of the APS. It does not appear that the amendment on October 31, 2016 makes any reference to the replacement of the 20 day clause in the schedule to the APS which specifically states that it applied notwithstanding the closing and completion date mentioned in the Agreement.
[56] Whether the contracting parties to the APS intended to preserve the primacy of the 20 day clause or not when the October 31 amendment was agreed upon is a triable issue that requires adjudication on the motion for summary judgment, or at trial. Mr. Teplinsky made the position of the plaintiff purchaser clear in his letters to Mr. Brannan that the 20 day clause should prevail. Mr. Brannan repeated the defendant sellers’ position that a new date for closing must be set once Mr. Wappler received the operating license from the previous operator that Mr. Brannan sent over to the Burych firm. However, Mr, Brannan repeatedly states in his correspondence that all other terms would remain the same, and that time would remain of the essence. A court may find that the 20 day clause in Schedule “A” was a term among those terms that survived the amendment, and if so, the 20 day clause expressly provides that it operates notwithstanding the closing and completion date mentioned in the Agreement.
[57] What the contracting parties intended by the language they used, having regard to all surrounding circumstances, and whether the one of the two competing clauses to set a closing date cancelled the other out after the APS was amended remains a triable issue. Elements of that triable issue may include the legal nature of each clause, such as whether one is a warranty or a true condition precedent, or whether one clause or another is sufficient to form part of a contract.
Factors to Consider on the Equities
[58] The relevant Dhunna factors must be applied on the evidence filed in support of the CPL when it was first obtained, and the evidence contained in the affidavits filed in support of, and in response to the defendants motion to discharge it. I am of the view after reviewing the Dhunna factor that it is not simply a matter of tabulating which factors favour one party or another. The weighing of equities requires something more. The court must engage in a holistic approach by considering the equities having regard to the evidence relevant to all Dhunna factors that apply in order to determine what the court considers a just result.
The Plaintiff as a Shell Corporation
[59] The defendants allege that the plaintiff is a shell corporation in their factum. However, there is no evidence that it is a shell corporation incorporated or intended only for use to hold the Agreement of Purchase and Sale as the purchaser.
[60] In any event, it was held by the court in Peter and Marty’s (Front) Ltd. v. Market Block, 1985 CarswellOnt 588 that a purchaser which is a shell corporation without assets incorporated to acquire an interest in land or to operate a business in premises on the land is not a valid reason to discharge a CPL. Therefore, this factor favours the plaintiff.
Are the Properties Unique?
[61] The Supreme Court of Canada articulated in Semelhago v. Paramedevan, (1996), 136 D.L.R. (4th) 1 that specific performance is available when the evidence establishes that property is unique to the extent that a substitute for the property would not be readily available to the plaintiff. The plaintiff has provided evidence that the subject property is unique in character because of its location, quality and intrinsic value.
[62] The plaintiff has given evidence that the property is specifically suited to the plaintiff’s intended use. The defendants dispute the plaintiff’s evidence that the property is unique in character so that it would qualify for the remedy of specific performance if the plaintiff is ultimately successful in the action. The defendants have not filed evidence on the motion to refute the plaintiff’s description of the properties, or it’s reasons for considering the properties unique.
[63] I therefore consider the evidence of the plaintiff to satisfy the court that the properties are unique to the plaintiff for their intended use.
Where there is an Alternative Claim for Damages
[64] The plaintiff claims damages in addition to or in the alternative to its claim for specific performance. The fact that a party has claimed damages as an alternative to the remedy for specific performance pleaded is not determinative of whether a CPL should be discharged: 962690 Ontario Inc. v. Ernst & Young Inc., (1997), 35 C.P.C. (4th) 173 (Gen. Div.). See also Tribecca Development Corporation v. Max Danieli and Danieli Development Group Inc., 2015 ONSC 7638 (Ontario Master) at paragraph 18.
[65] In its Statement of Claim, the plaintiff claims specific performance as its primary remedy. On the evidence filed in response to the defendant’s motion, Mr. Mand, president of the plaintiff corporation states that the plaintiff may elect specific performance as its remedy.
[66] It has also been held that a plaintiff may be put to an election between claiming damages and the revenue specific performance in Bowbriar Investments Inc. v. Wellesley Community Homes Inc., (1982) 24 R.P.R. 241 (High Court). The plaintiff has now indicated to the court that it is prepared to elect to proceed with its claim for specific performance of the APS over its alternative claim for damages.
[67] For these reasons, the plaintiff’s claim for damages as an alternative claim to specific performance is not a reason to discharge the CPL.
The Ease or Difficulty of Calculating Damages
[68] The defendants state that they have entered an Agreement of Purchase and Sale for each of the two adjacent properties for a total of $1,325,000.00. This exceeds the purchase price the plaintiff has agreed to pay by $125,000.00. The plaintiff states that this would be a straightforward basis for calculating the defendant’s damages if the plaintiff’s action is ultimately unsuccessful and the defendants can prove they have lost the opportunity to sell those properties to a third party.
The Presence or Absence of another Willing Purchaser
[69] The defendants have included Agreements of Purchase and Sale with the third party in the affidavit material filed in support of the motion. Those Agreements of Purchase and Sale specify a closing date of February 28, 2017. Other parts of the APS documents state they are conditional until February 28, 2017. In yet another Agreement attached to the defendants materials, the defendants are given until March 9, 2017 to remove various conditions.
[70] Although the factum of the defendants state that the third party has agreed to extend the due diligence and closing dates for properties to March 28, 2017, no evidence was before the court of those extensions. In fact, the affidavit of Erona Naraine, the assistant to Mr. Brannan, expressly states that the new closing dates are “subject to confirmation by our client, Mr. Wappler, who is overseas and incommunicado at present.”
[71] As the extension of the dates within the third party agreements are not in evidence, I cannot consider any such extensions on this motion. Consequently, I can only conclude for the purpose of this motion that the Agreements of Purchase and Sale between the defendants and any third party that were to close on February 28, 2017 had come to an end by the time this motion was heard under their own terms.
[72] Accordingly, there is no evidence that there is a willing purchaser other than the plaintiff for the two properties at issue.
Conclusion
[73] In summary, I find there to be a triable issue that requires adjudication by this court as to whether the Agreement of Purchase and Sale, as amended, between the plaintiff as purchaser and the defendants as the sellers remains valid and binding. If it is, the parties each have rights and obligations that flow from that APS. I also find on the evidence that the equities as I have considered them on the evidence before the court favour the plaintiff. The defendants have not satisfied the burden of proof the law requires them to meet in order to obtain the order they seek.
[74] The motion to discharge the CPL obtained under the order granted by Justice Bloom on January 16, 2017 is therefore dismissed.
[75] The plaintiff may serve and file written submissions if it seeks costs by March 31, 2017. The defendant shall then have until April 10, 2017 to serve and file responding submissions. All submissions shall be no more than two pages in length, not including a bill of costs or time dockets. No written submissions in reply shall be permitted without leave. All written submissions shall be filed by fax to my Judicial Assistant, Ms. Priscilla Gutierrez at 905-456-4834 in Brampton.
Emery J