COURT FILE NO.: CV-18-0255
DATE: 2019 07 12
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
JOACHIM ZWYGERS
David Silver, for Applicant
Applicant
- and -
LINDA APPIAH-KUBI, DOREEN APPIAH-KUBI and COLDWELL BANKER RONAN REALTY BROKERAGE
Doreen Appiah-Kubi for Respondents, Linda Appiah-Kubi and Doreen Appiah-Kubi
Respondents
HEARD: June 3, 2019
REASONS FOR DECISION ON APPLICATION
COROZA J.
A. The Motion
[1] The Applicant, Joachim Zwygers, brings an application for a determination of his rights under a settlement agreement pursuant to Rule 14.05(3)(d) of the Rules of Civil Procedure, R.R.O, 1990, Reg. 194.
[2] The litigation concerns the aborted sale of a property by the Applicant to the Respondents, Linda Appiah-Kubi and her daughter Doreen Appiah-Kubi.
[3] The Respondents are self-represented. Doreen appeared for herself and her mother at the hearing and made submissions.
B. Background
i) The Agreement of Purchase and Sale
[4] Zwygers agreed to sell his house to Linda and Doreen. The property is located in Alliston, Ontario.
[5] An agreement of purchase and sale (APS) was entered into on June 5, 2017. Linda and Doreen agreed to purchase the property for the sum of $800,000, with a closing date of October 27, 2017.
[6] As part of the offer, Linda and Doreen made a deposit in the amount of $10,000, to be held in trust by Zwygers’ realtor, Coldwell, pending completion of the APS.
ii) The Aborted Transaction
[7] By October 13, 2017, a lawyer acting for Linda and Doreen advised the lawyer for Zwygers that they could not complete the transaction because there were issues selling their own property.
[8] Zwygers took the position that this was an anticipatory breach of the APS and that in order to mitigate his damages he would place the house back on the market but that he would hold Linda and Doreen responsible for any deficit in the resale.
[9] Zwygers sold the property on May 14, 2018, for $725,000. This is $75,000 less than the APS.
iii) The Road to Settlement
[10] On June 14, 2018, counsel for Zwygers demanded payment in the amount of $104,183.99, reflecting damages incurred as a result of the breach of the APS.
[11] On June 26, 2018, counsel for Linda and Doreen offered the sum of $60,000 for a full and final release. This included forfeiture of the deposit of $10,000.
[12] Zwygers counter offered with the amount of $80,000 inclusive of the $10,000 deposit and legal fees in the amount of $3,500, payable within thirty days.
[13] The counter offer provided that in the event of default of payment, Linda and Doreen would consent to a judgment in the amount of $100,000 plus enforcement costs of $5,000.
[14] Linda and Doreen did not accept this counter offer. However, they authorized and directed the release of the $10,000 deposit.
iv) The Respondents Accept the Offer to Settle
[15] On July 18, 2018, Zwygers served another counter-offer suggesting settlement at $60,000, inclusive of the forfeited deposit, but also sought reimbursement for legal fees amounting to $2,500. The counter-offer also stated that if there was a default in the payment of the settlement funds, which was not rectified within three (3) business days of notice provided to Zwygers’ counsel, Linda and Doreen would consent to judgment in the amount of $100,000 plus enforcement costs of $5,000.
[16] On July 24, 2018, Linda’s and Doreen's lawyer communicated to counsel for Zwygers that his clients "agree it is a fair deal". Counsel advised that the deposit of $10,000 would be released immediately together with the necessary documents and that the sum of $50,000 would be paid via twelve monthly installments.
[17] Within the hour of this communication, the lawyer for Zwygers confirmed by email that the parties had a deal. Counsel provided July 31, 2018, as the first remittance date for the twelve monthly installments.
[18] Counsel for Linda and Doreen responded by email to the lawyer for Zwygers. In that email, he acknowledged that the deposit would be forfeited immediately. However, he also further requested three months to come up with a $10,000 payment and to pay the rest in monthly installments.
[19] On July 25, 2018, Zwygers advised Linda and Doreen that this was not agreeable. However, he agreed, on a without prejudice basis to a proposed payment of $2,500 for the first two months payable on July 31 and August 31, 2018, and $5,000 on October 1, 2018, and the balance of payments remitted in equal monthly installments at the end of each month until the settlement was paid.
[20] On August 8, 2018, counsel for Linda and Doreen confirmed that they were "in agreement with the offer" and "were putting together means of payment".
[21] To date, Linda and Doreen have made no payments since the settlement was reached.
C. Analysis
[22] Zwygers now brings this application for a determination of his rights under the settlement agreement. Specifically, he seeks an order pursuant to Rules 14.05(3)(d) and (h) of the Rules, to enforce the terms of settlement. At the hearing of this application, counsel for Zwygers advised that the $10,000 deposit has been released to Zwygers and they are no longer seeking relief in relation to those funds.
[23] In my view there are two issues to resolve on this application.
[24] First, do I have jurisdiction to deal with the application or is the relief claimed properly the subject of a motion under Rule 49?
[25] Second, if I do have jurisdiction, should the settlement be enforced and judgment granted in favour of Zwygers in accordance with the terms of settlement?
Issue 1: Do I have jurisdiction to deal with the application or are they properly the subject of a motion under Rule 49?
[26] My first impression was that this was a case that should have been brought under Rule 49. That rule permits a party to enforce a settlement agreement by setting out two stage procedure. As I understand the jurisprudence, under Rule 49, the court should first determine whether an agreement was reached and then consider whether the agreement should be enforced (see: Pomeroy v. Couprie et al; 2017 ONSC 6906 per Akbarali J. at paragraph 7).
[27] However, counsel for Zwygers submits that there is nothing about this case that prohibits Zwygers from proceeding by way of application. Zwygers argues that the Rules and common law jurisprudence provide that an application under Rule 14 is an appropriate procedure for a determination of rights in respect of a contract where it is unlikely that there will be any material facts in dispute.
[28] I am persuaded by counsel’s submissions.
[29] Rule 14.05(3)(d) speaks to the determination of rights that depend on the interpretation of a contract. Rule 14.05(3)(h) speaks to the use of an application to obtain relief in respect of any matter where it is unlikely that there will be any material facts in dispute.
[30] Again, the core assertion made by Zwygers is that there are no material facts in dispute. The record before me supports that assertion.
[31] First, during the oral hearing, Linda did not dispute the following:
• There is a binding settlement agreement
• Linda and Doreen's counsel was acting as their agent
[32] Second, it appears that the issue communicated by counsel for Linda and Doreen on the relevant dates was their ability to come up with a plan securing funds to pay off the settlement. In other words, the manner of payment and the timing of the payment were at issue. I agree with counsel for Zwygers that these two issues are non-essential terms and immaterial to determining whether a settlement agreement has been reached.
[33] I am satisfied that there is nothing in this record that suggests that material facts are in dispute. I am also satisfied that the terms of the agreement are clear and there is no impediment to my ability to interpret the rights of the parties under the settlement agreement.
[34] Accordingly, I have jurisdiction to deal with the issue under Rule 14 as an application. (see also: Paterson Veterinary Professional Corporation v. Stilton Corp Ltd; 2018 ONSC 4952)
Issue 2: Should the settlement be enforced and judgment granted in favour of Zwygers in accordance with the terms of settlement?
[35] I have previously set out the relevant terms of the settlement in the section entitled Background. There is nothing ambiguous about the terms of the settlement.
[36] In my view, the evidence on this record is clear and beyond doubt that the parties entered into a binding settlement agreement. The settlement was not conditional upon the Respondents obtaining any financing to fund the settlement. Furthermore, as I have stated above, the manner and method of payment are not essential terms of the settlement (see: CabCom Network Inc v. Strategic Media Outdoor Inc, 2012 ONSC 4148, at para 20).
[37] To date, Linda and Doreen have not paid any money to Zwygers. Doreen provides two reasons for this.
[38] First, as I understand her argument, Doreen argues that the sale of the home in May for $725,000 was improvident. This in turn, exacerbated the damages that Zwygers seeks. As I see it, her submission appears to be that Zwygers’ damages have been manufactured because he accepted a low price for the sale of the home once the APS was breached. Therefore, she disputes the damages he has incurred.
[39] In support of her submission, she has filed listings of similar homes in the Alliston area and the purchase price of those homes.
[40] I am not persuaded that this material assists Linda and Doreen.
[41] The issue on this application is not the sale price of the property after the APS was breached. The issue is whether the settlement that followed should be enforced. As such, the material filed is not one that impacts on a material fact on this application. As noted above, there was a settlement. Linda and Doreen were responsible for complying with the terms to perform their obligations under the settlement. The settlement is not conditional on Zwygers selling his house for a particular price.
[42] Moreover, the material that discloses the prices of other homes carries no weight in the absence of a live witness to explain to me the significance of these other prices. It would be unfair to Zwygers for the Court to consider this evidence and make a finding that this was a low sale without giving him the opportunity to cross-examine a live witness or call evidence in reply.
[43] Doreen’s second argument is a straightforward one. She asserts that they do not have the funds to pay the settlement because Linda has had surgery and cannot work. She has filed material that demonstrates that Linda has had surgery and that they are in debt.
[44] I am not persuaded by this argument.
[45] I acknowledge that Linda appears to be ill. I also acknowledge that Doreen asserts that they have no money to pay money to Zwygers. However, these factors are not relevant to the issue that I must decide. There was a settlement. The terms are clear. There has been no credible defence put forward on this application. It is my respectful view that courts must be seen to encourage parties to settle disputes and should, when required, enforce those settlements if there is a basis to do so. Parties need certainty and predictability in the settlement process.
D. Conclusion
[46] I have taken into account Doreen’s submissions about the health of Linda. I have also considered her position about the sale of the house. However, these submissions are not persuasive. Zwygers is entitled to $60,000.00, by certified funds, inclusive of the $10,000.00 deposit. Zwygers is also entitled to legal fees of $2,500.00. In the event that there is a default in payment of these funds and if the default is not rectified within three business days of notice being provided to Linda and Doreen, then they will consent to judgment in favour of Zwygers in the amount of $100,000.00, plus costs in the amount of $5000.00 to obtain judgment.
[47] After considering the ability of Linda and Doreen to pay, I conclude that Zwygers is entitled to the following orders:
Linda Appia-Kubi and Doreen Appiah-Kubi (the "Respondent Purchasers") are to pay to the Applicant Zwygers the sum of $50,000 by certified funds, in accordance with the terms of settlement agreed upon by the parties, pursuant to Rules 14.05(3)(d) and (h) of the Rules of Civil Procedure. For clarity, I order that the sum of $50,000.00 be paid in twelve monthly installments. The first remittance date for the installment payments is August 30, 2019;
Within fifteen days the Respondent Purchasers shall reimburse the Applicant $2,500 in legal fees incurred to negotiate the settlement in accordance with the terms of settlement agreed upon by the parties;
In the event the Respondent Purchasers do not comply with the judgment for payment of the amounts set out in these reasons, and if the default is not rectified within three business days notice being provided to Linda and Doreen, then the Applicant is entitled to a judgment in the amount of $100,000 and $5,000 in costs;
Any Harmonized Sales Tax which may be payable on any amount pursuant to the Excise Tax Act, as amended, or any other legislation enacted by the Government of Canada;
Pre-judgment and post-judgment interest in accordance with the Courts of Justice Act, R.S.O. 1990, c. C.43, as amended.
E. Costs
[48] I requested that the parties make submissions as to costs on June 3, 2019. Doreen does not seek costs but only asks that the application be dismissed.
[49] Counsel for Zwygers requests that partial indemnity costs in the amount of $17, 205.88 be ordered.
[50] He recognizes that the Respondents are sympathetic, but he points out that Zwygers is no less sympathetic. Zwygers has had to incur significant legal costs to enforce his rights following the breach of the APS.
[51] Zwygers points out that he has done everything in his power to obtain compliance. He points out that on April 23, 2019, this matter should have been heard but Doreen was granted an indulgence and the matter was delayed yet again.
[52] After reviewing the bill of costs, Zwygers has been successful on this application. The bill is reasonable. I am also mindful of the submissions of Doreen on behalf of the Respondents.
[53] I agree that Zwygers has behaved reasonably on this matter. That being said, the reality is that there was nothing really in dispute on this application and it was not complex. I think an appropriate amount of costs should reflect the complexity of the matter; the appearance in court to argue the motion; the preparation of written materials; and the ability of Doreen and Linda to pay the costs award if granted.
[54] Zwygers is entitled to the costs of this application. I award costs in the amount of $5,000 payable within 30 days to Zwygers.
Coroza J.
Released: July 12, 2019
COURT FILE NO.: CV-18-0255
DATE: 2019 07 12
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
JOACHIM ZWYGERS
- and -
LINDA APPIAH-KUBI, DOREEN APPIAH-KUBI and COLDWELL BANKER RONAN REALTY BROKERAGE
REASONS FOR DECISION ON APPLICATION
COROZA J.
Released: July 12, 2019