Court File and Parties

COURT FILE NO.: CV-18-2469 DATE: 2019 07 23

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: 1312733 ONTARIO INC. v. QUINTO SIMONE and GIOVANNA SIMONE

BEFORE: Doi J.

COUNSEL: T. Evangelidis, for the Applicant C. Harris, for the Respondents

HEARD: April 16, 2019

E N D O R S E M E N T

Overview

[1] The parties co-own a property, known municipally as 262 McNeilly Road in Stoney Creek, as tenants in common. The property consists of approximately 8.5 acres of undeveloped land that includes an orchard of fruit trees. There are no buildings or other such improvements on the property.

[2] The Applicant developer seeks an order under the Partition Act, R.S.O. 1990, c.P.4 ("Partition Act") for the property to be sold at fair market value. It wishes to incorporate the property with other parcels of land to complete its land assembly for a future residential development project. The Respondents are retired spouses who use the property as a recreational farm, and claim to prefer retaining their half-interest in the lands. They oppose the Applicant's proposed sale, and seek a partition of the property.

[3] For the following reasons, I find that the property should be sold.

Preliminary Issue - Supplementary Affidavit

[4] The Respondents seek to strike the supplementary affidavit of William Liske sworn March 19, 2019 because some of its content allegedly gives opinion evidence from a non-expert fact witness, and because other portions purportedly breach the rule in Browne v. Dunne.

[5] In his supplementary affidavit, Mr. Liske gives evidence (at para 14) as to certain requirements under ss. 50(20) of the Planning Act, and also gives his opinion (at para 16) as to the Applicant's development efforts and their impact on the future market value of the subject property. I find that para 14 contains improper legal opinion evidence or, alternatively, contains argument, and I give it no weight. His evidence at para 16 offers limited impressionistic views about the likely impact of the Applicant's development efforts on affected land values which I find to be largely self-evident, albeit argumentative. I am prepared to give this evidence limited weight.

[6] The Respondents challenge the admissibility of Mr. Liske's evidence at paras 10 to 12 of his supplementary affidavit which set out his views as to their intentions regarding the subject property. Paras 10 and 11 reflect his impressions of the Respondent's apparent motives in this matter. While I entertained these arguments from Applicant's counsel during his submissions, I give this part of Mr. Liske's affidavit no evidentiary weight. Para 12 of the affidavit factually sets out Mr. Liske's understanding of the Respondent's lack of prior effort to seek municipal approval for their proposed partition, and is admissible.

[7] The Respondents also wish to strike paras 3 to 11 of Mr. Liske's supplementary affidavit on the basis that they breach the rule in Browne v. Dunn. For the reasons that follow, I disagree with this submission.

[8] The Browne v. Dunn rule is about fairness and generally arises during cross-examination to prevent a witness from being ambushed by affording the witness a chance to state his or her position with respect to subsequent evidence which contradicts him or her on an essential matter; Yan v. Nadarajah, 2017 ONCA 196 at para 15. Here, in the context of an Application with an affidavit-based record, the Respondents seek to apply Browne v. Dunn to require cross-examinations on his client's affidavit before the Applicant may use a subsequent affidavit containing contradictory evidence. I am unable to accept their position.

[9] I find that the Applicant's use of Mr. Liske's supplementary affidavit did not breach Browne v. Dunn because the Respondents were well aware of the context of the dispute based on the Applicant's initial affidavit and the balance of the record. In describing the chronology of the dispute, Mr. Liske's supplementary affidavit did not take the Respondents by surprise. While certain parts of his evidence purport to explain the Respondents' motives and are somewhat argumentative, I find his evidence is rather predictable in view of his initial affidavit in the Applicant's record. The balance of Mr. Liske's supplementary affidavit which I have not specifically discussed innocuously sets out information that is not contentious and is admissible.

[10] Alternatively, assuming that Mr. Liske's supplementary affidavit did indeed breach the rule in Browne v. Dunn, I would exercise my discretion on the particular facts of this case to admit the evidence at paras 3 to 9 in Mr. Liske's supplementary affidavit (n.b., without paras 10 and 11, which I am not considering for the reasons stated above that do not implicate Browne v. Dunn) to show the simple chronology of the events that occurred in this case (i.e., as supported by various records which are appended as exhibits to the affidavit). I also would factor into consideration that the Respondents were not questioned in assessing their credibility and the weight of their evidence against the entire Application record. In my view this is a fair and proportional approach to address this evidence.

[11] I remain quite satisfied that this case may be fairly determined from the evidentiary record, as explained below, and that the credibility of the deponents is not a material issue given the overall content of the record before the court.

Background

[12] The Applicant is a land development company. In 2003, it purchased its half-interest in the property from a previous owner. It currently holds title to three (3) parcels of land, consisting of about 51.54 acres in Stoney Creek, which it assembled for a future residential development project. The Applicant wishes to include the property as part of its land assembly for this development. When it purchased its interest in the property, the Applicant knew that it was only purchasing a half-interest as a tenant in common with the Respondents. As such, it took somewhat of a calculated risk that it could later acquire the other half-interest and incorporate the entire property in its development plans.

[13] The Respondents are retired spouses who acquired their half-interest in the property in 1974. Over the years, they farmed the property, which is located a short-distance from their residential home. They used to tend a vineyard on the property, and now maintain and harvest a fruit orchard on the lands. After the Applicant bought its half-interest in the property, it retained the Respondents to cut the grass and maintain the property.

[14] The parties now find themselves at an impasse and unable to negotiate a sale of the Respondents' property interest to the Applicant. According to the Applicant, the Respondents are willing to sell their half-interest but only at a significantly inflated price which is said to be well-above its current fair market value. The Applicant feels that the Respondents are hard, if not unreasonable, negotiators. The Respondents claim to have a deep attachment to their lands and no desire to sell or lose the property. They claim that their offers to sell reflect their attachment to the lands and their disinterest in selling the property, which they prefer to keep in their family. The Respondents refuse to list the property for sale. Consequently, the Applicant has been unable to pursue its development plans, which has led it to bring this court proceeding.

[15] In an effort to arrive at an outcome that may accommodate both parties to some degree, the Respondents propose a partition of the property by which the Applicant would keep the northern half of the property and the Respondents would keep the southern half. The Respondent claim that they are prepared to obtain the necessary municipal approvals to effect a partition. However, this dispute has been ongoing for quite some time, and the Respondents have taken no steps to apply for municipal approval or consent for their proposed partition.

[16] The Applicant is opposed to the Respondents' proposed partition, which it claims would clearly contravene ss. 50(3)(b) of the Planning Act, R.S.O. 1990, c.P.13, as amended, and thus be void under ss. 50(2) of that Act unless the municipality's consent approval to subdivide the property is obtained. However, the Applicant notes that the Respondents' have not taken any steps to apply to the Land Division Committee of the municipality to obtain the necessary consent approval required to partition the property. It also points out that seeking municipal consent approval could well require a significant period of time to process. In the circumstances, the Applicant invites the court to find that the Respondent's position reflects an effort to stall or delay this case to gain a litigation and negotiating advantage. Moreover, even if the Respondents were to apply for the required municipal consent to partition, the Applicant submits that it is highly unlikely that the municipality would give its consent approval due to the significant nonconforming nature of the proposed partition.

Principles of Partition and Sale

[17] A co-owner of a property, such as a joint-tenant or a tenant-in-common, may compel the partition or sale of the co-owned lands by bringing an action or application pursuant to ss. 2 and 3(1) of the Partition Act. Essentially, a co-owner has a prima facie statutory right to a partition or sale to resolve an impasse over how a co-owned property should be used or disposed of: Greenbanktree Power Corp. v. Coinamatic Canada Inc. at para 1. There is a corresponding obligation on a co-owner to permit partition or sale, and the court should compel a partition or sale, absent a sufficient reason not to do so; O'Brien v. McGilvray, 2018 ONSC 2442 at para 12, citing Davis v. Davis, [1954] OR 23 (CA). The Applicant has a legal interest in the property and is entitled to bring this Application.

[18] In an application under ss. 2 and 3(1), there is a presumption in favour of partition: Di Felice v. 1095195 Ontario Ltd., 2013 ONSC 1 at para 109, citing Garfella Apartments Inc. v. Chouduri, 2010 ONSC 3413 at paras 10-13. But a sale will be ordered where it is "more advantageous to the parties" or the land is not suitable for partition: Partition Act, ss. 3(1); Di Felice at para 109; Garfella at para 11; Suddick v. Schwenger, [2007] OJ No 737 (SCJ) at para 34.

[19] The court retains a discretion to refuse a partition or sale in cases involving malice, oppression or vexatious intent, which the responding party must demonstrate to warrant refusing such relief: O'Brien at para 13; Di Felice at para 109; Greenbanktree at paras 1-2. Conduct that is malicious, vexatious or oppressive to warrant such a refusal must be more than unreasonably refusing to accommodate the wishes of the other co-owner (O'Brien at para 13, citing Brienza v. Brienza, 2014 ONSC 6942 at para 27). That being said, co-owners should only be deprived of their statutory right to a partition or sale in the limited circumstances of malice, oppression and vexatious intent; Greenbanktree at paras 1-2. In effect, the court should direct a partition or sale of land if no sufficient reason appears why such an order should not be made: Suddick at para 33, citing Davis v. Davis, [1954] OR 23 (CA).

[20] Notably, ss. 2 and 3(1) of the Partition Act are not intended to encourage or favour development, but only provide for a sale if it is "more advantageous to the parties interested:" Dibattista v. Menecola, [1990] OJ No 2161 (CA) at para 16. These provisions are not intended to afford a means by which one tenant-in-common can acquire the interests of the other: Ibid.

Analysis

[21] To resolve this matter, the Respondents propose to partition the property by severing it in half (i.e., in equal portions by area) whereby the Applicant keeps the north-half of the property and the Respondents keep the south-half. For the following reasons, I find that their proposal is untenable at law.

[22] The Planning Act provides for land use planning, including subdivision control. The main purpose of subdivision control has been described as follows:

The overriding purpose of subdivision control is to curb the indiscriminate carving up of land into subdivisions to ensure orderly development and to enable the municipalities to safeguard themselves against the high cost of providing municipal services. In short, the legislation was and is intended to enable the municipalities of Ontario to control and regulate the division of land into individual building lots.

Lapolla v. Estate of John Bostock, 2017 ONSC 7448 at para 60, citing Peirotti v. Lansink (1979), 25 OR (2d) 656 (Co.Ct.) at 658, aff'd , 54 OR (2d) 1 (CA). See also BRL Realty Limited v. Equinix Canada Ltd., 2019 ONSC 3080 at para 18.

[23] The key provision governing subdivision control is found at ss. 50(3) of the Planning Act. This subsection essentially prohibits a conveyance unless it satisfies one of the acceptable conveyancing categories. In the immediate case, the operative provision is ss. 50(3)(b) which provides:

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. [Emphasis added]

[24] In Lapolla, Sanfilippo J. helpfully explained (at para 62) that the policy intent behind ss. 50(3)(b) is to control the division of land into smaller parcels:

[62] Section 50(3)(b) is designed to respond to the very problem that prompted subdivision control: the division of land into smaller parcels. This section makes clear that the landowner is not allowed to convey property in circumstances in which the property owner retains ownership of the adjoining land. The terminology employed by s.50(3)(b) for this statutory mandate is that the vendor "does not retain the fee … of … any land abutting the land that is being conveyed."

The term "fee" refers to the interest in land that confers on its holder the absolute right to dispose of the land, per: Lapolla at para 65, citing Re Forfar and Township of East Gwillimbury, [1971] 3 OR 337 (CA) at 344:

I take it to be the view of the members of the Court who decided Re Richmond et al. and Rothschild that the term "fee" as used in s. 26(1)(b) [the predecessor to s. 50(3)(b)] meant such an estate or interest as was reasonably necessary to accomplish the purpose which the legislators had in view and was not used in its narrow, technical, legal sense. … It is against the retention of such power of control over alienation of the property abutting the land conveyed or otherwise dealt with that the prohibiting provisions of [s. 50(3)(b)] are aimed.

This reasoning was upheld on appeal: Re Forfar at para 1. It follows that s. 50(3)(b) prohibits a grantor from retaining a fee interest in an abutting land.

[25] Applying the foregoing, I find that the Respondents' proposal to partition the property would violate s. 50(3)(b). Applying the foregoing analysis to this case, it is clear that a partition of the subject property in half with each of the parties retaining the fee for an equal half of the property would clearly violate s. 50(3)(b) of the Planning Act because they would retain a fee in abutting lands. My conclusion is reinforced by the evidence of David Aston, the Applicant's land use planning expert, who expressly holds this view. Also, Robert Lehman, the Respondent's land use planning expert, does not expressly contradict this.

[26] In submissions, Respondents' counsel submitted that a retention of a fee interest by the parties in abutting lands on their proposed partition of the property would not violate ss. 50(3) or (2) of the Planning Act because those provisions arguably apply only if the ownership interest in the abutting lands is "identical." However, Respondents' counsel was unable to provide any authority to support this position. Although he sought to rely on an excerpt from a document that is described as a "training presentation" by a lawyer who had posted the content to his firm's website, this material does not actually address the specific partition scenario that arises in this case. The material also does not set out how the views reflected in its content were arrived at, and does not offer any jurisprudence to validate its opinions that are largely expressed as conclusions without supporting analysis. As such, I find this document to be unpersuasive.

[27] Under ss. 50(20) of the Planning Act, no order made under the Partition Act for the partition of land has any effect at law unless: a) irrespective of the order, each part of the land described in the order could be conveyed without contravening s. 50 of the Act; or b) consent to allow the partition or conveyance is obtained from the municipality where the property is found. Since the Respondent' proposed partition contravenes ss. 50(3)(b) and the municipality clearly has not consented to the proposed partition, ss. 50(20) operates to render any order for such a partition to be without legal effect. It follows that the Respondent's proposed partition is untenable at law.

[28] As a partition of the property is legally unsuitable, I find that it is clearly more advantageous to order a sale of the property.

Request to Stay or Adjourn

[29] Even if a partition of land would violate the Planning Act, it may still have effect in law if municipal consent approval is given: Planning Act, ss. 50(2). Consent must be provided by the appropriate municipality where the land is located; Planning Act, ss. 50(1). To this end, and to apply for consent approval of their proposed partition from the City of Hamilton (i.e., the municipality where the property is located), the Respondents request a stay or adjournment of this proceeding. The Applicant opposes the request, and objects to any delay in having this matter determined. For the reasons that follow, the request to stay or adjourn is not granted.

[30] To obtain an interlocutory stay, a moving party must show that: (a) there is a serious issue to be tried (or, in some cases, the party has a strong prima facie case); (b) the moving party will suffer irreparable harm if the injunction is not granted; and (c) the balance of convenience favours granting the stay: Lobanova v. Grynyshyn, 2019 ONSC 3064 at para 43. I am also mindful of the court's overarching need to exercise discretion having regard to the interests of justice in the case: Lobanova at para 50.

[31] The Respondents claim to be willing to seek the City of Hamilton's consent for their proposed partition, which they first raised in their factum and argued in their submissions without other prior notice. The Respondents submit that courts have ordered this relief even in cases where it seemed that obtaining consent from the municipality was "extremely unlikely:" Rolston v. Rolston, 2016 ONSC 2937 at para 121.

[32] As the Respondents have not shown any evidence that the municipality is prepared to consent to their proposed partition, the Applicant argues that obtaining municipal consent is unlikely. Relying on Mr. Aston's expert view that the proposed partition would not comply with the municipality's official plan policies because the resulting lots would not conform to applicable zoning by-laws (i.e., in part, due to the fact that the proposed partitioning would further fragment the property rather than assemble lands), the Applicant submits that the proposed partition would not meet requisite zoning regulations to be properly considered for municipal consent approval.

[33] From Mr. Lehman's expert evidence, the Respondents claim that the municipality's consent might be given for their proposed partition because the granting of municipal consent is arguably unconstrained by zoning constraints (i.e., such that a municipality may consent to create non-conforming lots). To this end, s. F1.14.3.2 of the municipality's official plan provides that where a consent is required for the purposes of land assembly to implement a secondary plan or Neighbourhood Plan, Policy F1.14.3.1c shall not apply.

[34] The Respondents further argue, among other things, that their proposed partition would not necessarily be inconsistent with the municipality's official plan because the plan's long term goal is to bring these and other parcels of land in the area into development. They also argue that the municipality may consent to the proposed partition to help resolve this civil dispute by allowing, or at least improving the chance of, at least the north-half of the property to be developed, to thereby promote area development. As such, the Respondents submit that the municipality may grant its consent approval.

[35] From the evidence and submissions, I am persuaded that there is a possibility that the City of Hamilton may give its consent to the proposed partition. I accept that the municipality arguably has the ability to grant its consent based on its authority under s. F1.14.3.2 of the official plan to do so without requiring zoning compliance, such that it is not a foregone conclusion that the municipality's consent would not be granted.

[36] The Applicant also opposes the request to stay or adjourn because the Respondents failed to diligently bring their consent application to the City of Hamilton before the return of this Application despite knowing that pursuing municipal consent approval would be a live issue. Arguing that the Respondents essentially made a strategic decision to not earlier bring their consent application to the municipality, the Applicant submits that it is now inappropriate to stay or adjourn this proceeding at this juncture given the delay that would be incurred to the prejudice of its interest in concluding this proceeding to exercise their statutory right to pursue a sale of the property. The Respondents claim to have not earlier applied for municipal consent approval because the Applicant had tried repeatedly to purchase their half-interest in the property. This apparently led the Respondents to believe that the Applicant would be extremely unlikely to co-operate with an application for municipal consent to partition. As such, the Respondents claim to have been disinclined to take steps to apply for municipal consent without their co-owner's co-operation and consent, as any such effort would have been futile. The difficulty with the Respondents' position is that the Applicant continues, unsurprisingly, to oppose a partition. It follows that the circumstances for the Respondents to apply for consent approval essentially remains unchanged at this time, apart from the added passage of time during which the parties have argued this Application.

[37] While an assessment of the merits of a moving party's case is a relatively low hurdle, I find no strong basis to stay the case on this arm of the test because the proposed partition is legally untenable, as explained above. Although I accept that it is open for the municipality to consent to the proposed partition despite its non-compliance with zoning regulations, I do not see a particularly strong claim on the evidentiary record before me.

[38] I also find that the Respondents have not made out a compelling case for claiming irreparable harm if a stay is not granted. I accept that the Respondents decided to not apply for municipal consent approval believing the Applicant co-owner's likely refusal to co-operate would probably compromise any such application. However, the fact remains that the Applicant still remains opposed to the proposed partition. As such, nothing has changed materially in that regard, and the same concern that led the Respondents to defer bringing their consent application still remains. While I also accept that the municipality has the ability to grant consent approval, I find from the evidentiary record that the likelihood of its consent being given is unclear because the consent sought is for a non-conforming partition that likely will raise policy concerns for the municipality. Accordingly, from the evidence before the court, I find that the potential for the Respondents to successfully obtain the municipality's consent is uncertain and remote. As such, I find that the Respondents have not shown a compelling case for claiming irreparable harm if a stay is not granted.

[39] I also find that the balance of convenience does not favour granting a stay. In light of the Respondents' decision to not apply for the municipality's consent approval earlier, which appears to have been a deliberate and strategic one for reasons that essentially have not changed, I find on balance that it would be unfair to the Applicant to direct a stay of this Application at this time, after the case has been argued. The Respondents' position on the consent application matter is not particularly strong, and they have not made out a compelling case for irreparable harm. Accordingly, I find that the advantage to the Respondents of granting a stay is outweighed by the detrimental impact on the Applicant, which favours an exercise of discretion to not grant a stay at this time.

[40] Applying similar considerations to the Respondent's alternate request to adjourn this Application for the same reasons, I find that it is fair and just to exercise my discretion to not adjourn this Application. While this decision does not foreclose the Respondents from pursuing municipal consent approval for their proposed partition, I am unprepared at this time to stay or adjourn this Application for that purpose.

No Malice, Oppression or Vexatious Intent

[41] As set out below, I find that the Respondents have not demonstrated malice, oppression or vexatious intent to warrant an exercise of discretion to refuse to order a sale of the property.

[42] For over the past year, the parties have engaged in ongoing negotiations regarding the disposition of the Respondents' half-interest in the property which the Applicant seeks to acquire to complete its exclusive ownership of its land assembly. Despite these negotiations, the parties have been unable to agree upon terms of sale for the Respondents' interest. Although the Respondents claim that the Applicant engaged in bad faith tactics in its effort to acquire their interest, it is my determination that the Applicant has not acted in bad faith.

[43] On or about April 13, 2018, the Applicant made its most recent offer to purchase the Respondents' half-interest in the lands for $3,200,000.00. Its offer reflects a proposed purchase price of about $754,715.00 per acre (i.e., as the subject property consists of 4.24 acres) for the Respondents' half-interest. According to the Applicant, its offer was significantly above fair market value based on a valuation it undertook which concluded that the appropriate market price for the lands was approximately $565,000.00 per acre.

[44] On April 20, 2018, the Respondents declined the Applicant's offer, and advised that they would be prepared to sell their half-interest for $7,900,000.00 (i.e., reflecting an earlier offer they had given to the Applicant on February 28, 2018), which represented a price of $1,863,207.54 per acre. The Applicant did not accept the Respondents' offer because it was too high in price.

[45] On April 30, 2018, the Respondents asked the Applicant to refrain from bringing this Application under the Partition Act because they felt that it was premature and likely would be unsuccessful. When the Applicant continued with this proceeding, the Respondents formed the belief that the application was not brought in good faith with the intent of coercing them into selling their half-interest by interfering with their intent to keep the interest for estate planning purposes and to have the land to build a new home for themselves. I am unable to accept this submission.

[46] Although the Respondents purportedly want to preserve their interest in the property (i.e., which they feel they should not be forced to give up), it is not open for them to argue that the Applicant has acted in bad faith simply because it brought this Application under the Partition Act for the property to be sold at fair market value. As set out above, a co-owner of a property is prima facie entitled under ss. 2 and 3(1) of the Partition Act to seek a partition or sale to resolve an impasse regarding the disposition of the property: Greenbanktree at para 1. Correspondingly, the other co-owner of the property is obliged to permit a partition or sale and the court is required to order a partition or sale, unless there is a sufficient reason to not do so: O'Brien at para 12. It follows that the Applicant did not act in bad faith simply by exercising its statutory right to seek a sale of the co-owned property at fair market value.

[47] The Respondents also claim that the Applicant acted in bad faith because it previously indicated that it would develop only the balance of its land assembly without the Respondent's half-interest, only to later bring this Application for a sale of the property at fair market value. But borrowing the reasoning from the duty to act in good faith in a contractual context, I find that acting in good faith does not require a party to forego advantages or rights: Bhasin v. Hrynew, 2014 SCC 71 at paras 73 and 93, or otherwise impose a duty of loyalty or a duty to make disclosure. Accordingly, the fact that the Applicant now seeks to acquire the property for development purposes by exercising its statutory right to pursue a sale order under the Partition Act is not "bad faith" regardless of how strongly the Respondents disagree with the Applicant's position which conflicts with their wish to retain their half-interest.

[48] There is nothing improper with the Applicant's commercial goal of wanting to acquire the Respondents' half-interest in order to develop the lands. Similarly, there is nothing improper with the Applicant's disagreement with the Respondents as to whether the property ought to be partitioned or sold. The fact that the Applicant disagrees with the Respondents as to the proper outcome of this Application for the disposition of the subject property does not itself give rise to bad faith. Similarly, the Applicant's refusal to accept the Respondents' latest offer to sell does not show any bad faith conduct. While I accept that the parties also disagreed over their grass cutting arrangement for the property, I am unprepared to find from the evidence on this point before the court that the dispute goes to show that the Applicant engaged in bad faith.

[49] Relying on a November 22, 2016 decision of the Ontario Municipal Board, the Respondents argue that the Applicant engaged in tribunal proceedings regarding the property without giving them notice. I am unpersuaded by this argument and find no basis on the evidence to find that the Applicants engaged in bad faith against the Respondents. The Applicant claims that it participated in the development process simply for the purpose of preserving its interest in the land assembly, which is consistent with its actions in this proceeding.

[50] The Respondents claim that the Applicant somehow tried to exclude them from a block servicing strategy meeting in March 2017. However, minutes from the March 22, 2017 meeting appear to show that the Respondents attended the relevant land owners' group meeting about developing their respective lands. They also appear to have participated during the meeting by inquiring about their further involvement in the group and the associated participation fees, among other matters that were raised. Subsequently, the Respondents were invited to attend and participate in future land owners' group meetings, and are said to have done so. They are also said to have received email communications and meeting invitations, minutes of those meetings, a draft funding agreement, and a cash call summary chart prepared by the land use planner assisting the land owners group with the development process. The Applicant claims that the Respondents ultimately refused to participate in the land owners group and pay their share of the requisite participation costs. According to the Respondents, the cost for them to join the land owners group was too expensive. Although they were given the option of joining the group later, the Respondents declined to do so because the required installment to be paid on a deferred basis would only be higher and continue to remain unaffordable for them.

[51] From the foregoing, I find that the Respondents have not shown that the Applicant acted in bad faith. From the evidence and submissions to the court, I find no basis to find that the Applicant engaged in bad faith conduct because it acted to advance its lawful interests. I am also unable to find that the Applicant acted in bad faith towards the Respondents based on how the land owners group was established and functioned. Although I have a measure of sympathy for the Respondents' apparent reluctance to pay the somewhat high cost to join the land owners group (n.b., due apparently to the cost of arranging for land appraisals), that decision was theirs to make and in my view does not ground a proper claim of bad faith against the Applicant based on the materials before the court.

[52] The Respondents also claim that the Applicant acted in bad faith by arranging for a well test site to be drilled on the property, and by arranging for another test site to be marked with a post and pink flag. I am unpersuaded that this activity constitutes any evidence of bad faith.

[53] For these reasons, I find that the Respondents have not shown any malice, oppression or vexatious intent by the Applicant to warrant a refusal to order a sale of the property.

Conclusion

[54] Having regard to the above-mentioned findings, I hereby determine that it is appropriate to order that the subject property be sold at fair market value.

[55] The Applicant was successful on this Application and is entitled to its costs. Having regard to the parties' cost submissions, I am awarding these costs on a partial indemnity scale in the fixed amount of $15,000.00, inclusive of taxes and disbursements, which I believe is fair and proportional given the nature and complexity of this matter.

[56] Accordingly, I make the following orders:

1. the subject property, known municipally as 262 McNeilly Road, Stoney Creek, Ontario ("Property"), shall be sold on the following terms;
2. the net proceeds from the sale of the Property shall be split equally between the parties;
3. one independent and qualified real estate brokerage firm, which is experienced with the sale of property similar to the Property, shall be retained by the parties as the listing agent to market and sell the Property. The cost of retaining the listing agent shall be shared equally between the parties, and may be recovered from the proceeds of sale when the Property is sold;
4. the parties shall obtain from a qualified appraiser an updated appraisal of the current market value of the Property, which shall then be used to set an appropriate listing price in consultation with and on the recommendation of the listing agent. The cost of the updated appraisal shall be shared equally by the parties and may be recovered from the proceeds of sale of the Property;
5. the parties shall retain and instruct an appropriate real estate lawyer to complete the transaction for the sale of the Property;
6. the cost of the appraisal and the cost of retaining the real estate lawyer shall be shared equally by the parties, and may be recovered from the proceeds of sale of the Property;
7. if the parties cannot agree on a real estate brokerage firm or a real estate lawyer by August 16, 2019, then I may be spoken to for the selection and appointment of such a firm and/or lawyer from their list of proposed candidates who shall submit their business proposals;
8. the approved listing broker shall provide reasonable guidelines and listing periods for the marketing and sale of the subject property, including allowances for reasonable due diligence by prospective purchasers;
9. all information regarding the Property and its sale will be disseminated promptly to the parties as they or their counsel may direct;
10. the parties shall forthwith cooperate in arranging for the sale of the Property in accordance with these terms, and shall provide necessary documents and information to the listing agent and the real estate lawyer, respectively, as necessary to cause the listing, sale and closing of the sale to occur and be finalized, as may be required;
11. the bidding process shall proceed with reasonable dispatch and should be concluded by October 25, 2019 unless otherwise agreed upon by the parties and subject to further order by the court;
12. the parties shall have the opportunity to bid on the purchase of the subject property and to receive all relevant information concerning the property and its sale in order to perform their own due diligence;
13. no party shall enjoy a right of first refusal or right of first offer in connection with the sale of the subject property;
14. all offers to purchase must be sealed and received by a bid deadline date as determined by the listing broker. No offers to purchase that are received after the bid deadline date may be considered;
15. all offers to purchase shall be opened at the same time after the bid deadline has passed;
16. the parties shall be entitled to attend the opening of the offers;
17. the highest offer for each property shall be accepted, subject to the right of such offer to be improved through negotiation based on any recommendation by the listing broker, unless the parties agree otherwise and subject to further order by the court;
18. the net sale proceeds shall be paid into court, unless the parties agree otherwise and subject to further order by the court;
19. the parties or the approved broker may seek further directions from the court regarding the marketing and sale process, including the acceptance of any offers or any other matters related to the bid and sale process for the subject property;
20. The Respondents shall pay to the Applicant its costs in the fixed amount of $15,000.00, inclusive of taxes and disbursements, which are payable in 60 days.

[57] I shall remain seized to deal with any implementation issues. I thank both counsel for their able submissions.

Doi J.

DATE: July 23, 2019