Court File and Parties

COURT FILE NO.: 0311/17 DATE: 20170720 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Ali Malek-Zadeh and 9975924 Canada Limited, Applicants AND: Hermine Wekerle and Caron Hartmann, Respondents

BEFORE: Wilton-Siegel J.

COUNSEL: J. R. Rosenstein, for the Applicants M. G. Bawolska, for the Respondents

HEARD: July 13, 2017

Endorsement

[1] The applicants seek specific performance of an agreement of purchase and sale dated July 20, 2015 between the applicant, Ali Malek-Zadeh (“Ali”) on behalf of a corporation to be incorporated, as purchaser, and Hermine Wekerle (“Wekerle”), as vendor (the “Agreement”).

[2] The Agreement was signed on behalf of Wekerle pursuant to a power of attorney granted in favour of her daughter Caron Hartmann. Ali subsequently assigned the benefit of the Agreement to the other applicant, 9975924 Canada Limited (“997”), of which Ali is the owner.

[3] The Agreement relates to a property known municipally as 7788 Yonge Street, Vaughan, Ontario (the “Property”). Upon hearing of the Agreement, Wekerle sought to rescind the transaction. She says that the Property, upon which it appears a chapel has been built, has sentimental value for her.

[4] The applicants have brought this application for specific performance of the Agreement in favour of 997. At the hearing, Wekerle did not contest the enforceability of the Agreement against her. The only issue addressed is the availability of specific performance in the circumstances.

[5] The applicants did not adduce any evidence relevant to this issue in the application record. On the cross-examination of Ali, at question #13, however, Ali was asked to describe the chapel on the Property. He responded: “it was a … it is a private chapel, as there is a sign on the property, and it is the … is a heritage building.”

[6] In addition, the following exchange occurred at questions #35-38:

Q. Why were you buying this property in particular?

A. The chapel, because of the nature of the building, and then historical, is very related and unique for my type of business, as I wanted – I was looking to have a place for my business.

Q. Okay. Are there other chapels out there that are the same or similar?

A. It’s very ---

Q. Have you ever – in your search for a property, were you considering other properties?

A. No. Because I couldn’t find.

Q. You said that the property was unique to you?

[7] The leading case regarding the availability of a remedy of specific performance in respect of a contract for the sale of land is Semelhago v. Paramadevan, [1996] 2 S.C.R. 415. In that decision, at para. 22, Sopinka J. stated that “Specific performance should, …, not be granted as a matter of course absent evidence that the property is unique to the extent that its substitute would not be readily available.”

[8] What constitutes sufficient evidence that a property is unique will, of course, depend on the circumstances of each case. In this case, the applicants have done no more than establish that, in the opinion of Ali, the Property is unique based on his assertion that it is a heritage property. In my opinion, the applicants’ evidence is not sufficient to establish that the Property is unique for the following reasons.

[9] First, as a general matter, there is no evidence regarding the size, location, nature or state of the Property, except that there is a chapel of some sort located on it. Nor is there any evidence of how the Property qualifies as a heritage property. Further, there is no evidence as to the nature of the applicants’ business, the relevance of which I will address below. Lastly, there is no evidence regarding any search that Ali may have conducted prior to entering into the Agreement that would provide evidence of the absence of the availability of other properties that are similar, presumably as “heritage properties”.

[10] Second, more particularly, the applicants say that, while a commercial property, the Property should be assessed for uniqueness as being akin to a residential property, based on the fact that it is to be acquired for the operation of a business rather than as an investment property. They suggest that the similarity arises from the fact that Ali will spend a considerable portion of his life working at this location. For this reason, they suggest the aesthetics of the Property are important in this case in the same way as the aesthetics of a residential property. They also say that this case most closely resembles the circumstances in Marvost v. Stokes, 2011 ONSC 4827 (S.Ct.) aff’d 2012 ONCA 74. They rely on the statement of Backhouse J. in that decision to the effect that “[t]here is a subjective aspect to uniqueness which will normally be more significant in residential premises”.

[11] Regardless of whether this analogy could be made in other cases, there is no evidence to support this analogy in the present proceeding. As mentioned, there is no evidence regarding Ali’s proposed business nor is there any evidence as to the amount of time, if any, he expects to spend on the premises. In fact, there is no evidence that he would spend any time at the premises. Nor is there any explanation as to how the fact that the Property is a “heritage property”, or its current state, will enhance his enjoyment of the Property to the extent that he does work there.

[12] Third, in addition, there is also no support for the alternative suggestion of the applicants that a heritage building is important for marketing purposes, that is, that it is important for the public profile of Ali’s business. Nor is there any evidence connecting the aesthetic characteristics of the Property to the applicant’s proposed conduct of business that would support the uniqueness of the Property.

[13] Lastly, the applicant also relies on the decision of Silverberg v. 1054384 Ontario Ltd., [2008] O.J. No. 4585 (S. Ct.). However, the circumstances were very different in that case. In particular, there was clear evidence that the characteristics of the Property were ideally suited to the purchaser’s business as it had developed. As mentioned, such evidence is lacking in the present case.

[14] Accordingly, the motion for specific performance of the Agreement is dismissed. The parties should schedule a 9:30 conference with the Estates List office to address the procedure for determination of the damages, if any, owing by Wekerle for breach of the Agreement.

[15] By agreement of the parties, the costs of this proceeding to date, including this hearing, are reserved for the application judge who determines the issue of damages.

Wilton-Siegel J. Date: July 20, 2017