COURT FILE NO.: CV-17-581301

DATE: 20190129

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: JUNYI ZOU and TIAN LE, Plaintiffs/Defendants by Counterclaim

AND:

SASWATA SANYAL and SHALINI SANYAL, Defendants/Plaintiffs by Counterclaim

BEFORE: Cavanagh J.

COUNSEL: Christopher Tan and Dr. Ran He, for the Plaintiffs/Defendants by Counterclaim

Suvendu Goswami, for the Defendants/Plaintiffs by Counterclaim

HEARD: January 23, 2019

ENDORSEMENT

Introduction

[1] This is an action brought by the sellers of a residential property against the purchasers for declaratory relief and damages arising from the alleged breach of the agreement of purchase and sale caused by the defendants’ failure to close.

[2] The plaintiffs move for summary judgment.

[3] For the following reasons, I conclude that the plaintiffs are entitled to summary judgment.

Background Facts

[4] The plaintiffs and moving parties, Junyi Zou and Tian Le, were the owners of property municipally known as 340 McDougall Crossing, Milton, Ontario (“the “Property”).

[5] The plaintiffs entered into an agreement of purchase and sale with the defendants Saswata Sanyal and Shalini Sanyal for the sale of the Property that was accepted by the defendants on April 25, 2017 (the “Agreement”). The defendants paid a deposit of $40,000. Under the Agreement, the time and date for completion was no later than six o’clock p.m. on July 18, 2017.

[6] The plaintiff Junyi Zou executed the Agreement on her own behalf and she executed it on behalf of her husband, Mr. Le, pursuant to authority granted to her in a “Continuing Power of Attorney for Property” dated December 11, 2016.

[7] On June 19, 2017 the defendants’ real estate agent, Raj Paramasamy, sent an email to the plaintiffs’ real estate agent, Rachel Wang, in which he advised that the defendants needed to sell their current home which was still on the market and that the defendants would need to extend the date for closing of the purchase of the Property. In response, Ms. Wang advised that the plaintiffs had bought another property and needed the money from the sale of the Property in order to close the purchase of their new property. She did not agree to extend the date for closing.

[8] On July 5, 2017 the defendants’ agent advised the plaintiffs’ agent that his clients were not able to obtain mortgage financing to close the purchase of the Property unless the plaintiffs were willing to renegotiate the purchase price. The defendants’ agent advised that the defendants intend to close their purchase of the Property, but are unable to do so. In response, by email also dated July 5, 2017 the plaintiffs’ agent advised that the plaintiffs cannot do anything about the purchase price.

[9] By letter dated July 5, 2017, the real estate lawyer for the defendants, Mr. Sidker, sent a letter to the real estate lawyer for the plaintiffs, Xingbin Hoang, raising requisitions in respect of the Agreement. By letter dated July 17, 2017, the day before the scheduled closing date, Ms. Hoang responded to the requisitions letter. Following receipt of this July 17 letter, Mr. Sidker sent a copy of this letter by facsimile to Ms. Hoang on which he noted “Sorry I am not acting anymore” and he attached a copy of a letter sent to him by the defendants’ new lawyer, Mr. Suvendu Goswami, in which Mr. Goswami advised that he was now representing the defendants as their legal counsel.

[10] On the day of closing, the plaintiffs’ lawyer took steps to attempt to tender the closing documents and keys on the lawyers for the defendants. Before the time for closing had passed, Mr. Goswami wrote to the plaintiffs’ lawyer and advised that his clients’ position was that the Agreement is null and void ab initio on grounds set out in the letter. In his letter, Mr. Goswami relied upon the following grounds:

a. The statement in the MLS listing that the approximate square footage was 2000-2500 sq. ft. was incorrect.

b. The plaintiffs had failed to provide a survey of the Property, notwithstanding paragraph 12 of the Agreement.

c. A provision with respect to inspection which was struck out from Schedule A to the Agreement runs counter to paragraph 13 of the Agreement.

d. The Property is grossly overpriced, and both real estate agents along with the plaintiffs have not acted in good faith, with the result that the Agreement was executed in haste, such that it is null and void and unenforceable.

e. The answers provided to the letter of requisitions on the eve of closing are illegal, improper and unacceptable, and the striking out of paragraphs in the draft documents is illegal.

[11] The sale of the Property pursuant to the Agreement was not completed. The plaintiffs did not receive payment of the purchase price from the defendants.

[12] The plaintiffs relisted the Property for sale on July 25, 2017 for a list price of $910,000. The plaintiffs lowered the list price to $859,000 on August 14, 2017, and then to $819,000 on September 19, 2017. No offers were received on or before September 28, 2017. The plaintiffs then changed real estate agents and on October 6, 2017 the plaintiffs relisted the Property for sale at a list price of $819,000. By October 18, 2017, the plaintiffs had received one offer to purchase the Property at a purchase price of $745,000. On that day, the plaintiffs lowered the list price to $799,000. The plaintiffs received an offer on October 24, 2017 in the amount of $780,000 and, later that day, after several rounds of bargaining, the plaintiffs accepted an offer to purchase the Property for a purchase price of $797,000.

[13] Under this agreement, the sale of the Property was to be completed on December 8, 2017. This sale was completed on this completion date. The plaintiffs paid 5% of the purchase price, plus HST, for the commission fee upon completion of the transaction under the new agreement of purchase and sale. The plaintiffs’ new real estate agent received 2.5% of the purchase price plus HST and the new buyer’s real estate agent receive the other 2.5% of the purchase price plus HST as a commission fee.

[14] The plaintiffs commenced this action by statement of claim issued on August 22, 2017. They claim damages from the defendants for breach of the Agreement together with related relief. The defendants defended the action and counterclaim for rescission of the Agreement and return of their deposit in the amount of $40,000 together with related relief. The defendants also commenced a third party claim against the plaintiffs’ real estate agent and their own real estate agent.

[15] The plaintiffs move for summary judgment on the ground that there is no genuine issue requiring a trial. The defendants oppose this motion.

Analysis

[16] The issue on this motion is whether the plaintiffs are entitled to summary judgment.

[17] Rule 20.04(2)(a) of the Rules of Civil Procedure provides that where a motion for summary judgment is brought, the court shall grant summary judgment if the court is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence.

[18] In Hryniak v. Maudlin, 2014 SCC 7 the Supreme Court of Canada held:

There will be no genuine issue requiring a trial when the judge is able to reach a fair and just determination on the merits on a motion for summary judgment. This will be the case when the process (1) allows the judge to make the necessary findings of fact, (2) allows the judge to apply the law to the facts, and (3) is a proportionate, more expeditious and less expensive means to achieve a just result.

[19] The defendants submit that the plaintiffs have failed to show that there is no genuine issue requiring a trial. The defendants submit that there are genuine issues requiring a trial with respect to the plaintiffs’ claim in relation to the following matters:

a. The plaintiffs’ alleged non-disclosure of the Power of Attorney and failure to register it in the Teraview System before closing.

b. The plaintiffs’ alleged misrepresentation of the floor area of the Property.

c. The plaintiffs’ failure to deliver a survey.

d. The legal effect of the striking out of certain provisions in the defendants’ original offer without a signed written waiver.

e. The plaintiffs’ failure to obtain an appraisal of the Property when it was listed for sale.

f. The plaintiffs’ credibility generally.

Is there a genuine issue requiring a trial in relation to whether the plaintiffs improperly failed to disclose the Power of Attorney and register it in the Teraview System?

[20] The defendants submit that the plaintiffs did not disclose the power of attorney or attach it to the Agreement and, as a matter of law, they were entitled to treat the Agreement as void ab initio as a result.

[21] The power of attorney provides that the Ms. Zou is authorized, on Mr. Le’s behalf, to do any and all acts which he could do if capable, except for the making of a will, for Mr. Le’s property. The power of attorney specified that there are no conditions or restrictions to the authority provided by Mr. Le to Ms. Zou thereunder.

[22] In his cross-examination, the defendant Saswata Sanyal acknowledged that one of the sellers, Ms. Zou, was present when the Agreement was signed and told him that she held a power of attorney for her husband.

[23] The Agreement shows that Ms. Zou executed it for herself and as attorney for her husband because she signed the Agreement on behalf of her husband using the initials “P.O.A.”. The Agreement was provided to the defendants’ real estate lawyer, Mr. Sidker, who did not raise any issue about the fact that the Agreement had been signed pursuant to a power of attorney. There is no issue about the validity of the power of attorney which was accepted for registration in the Teraview System on the subsequent sale of the Property. The fact that the power of attorney was not provided to the defendants when the Agreement was made does not affect the validity of the Agreement.

[24] The defendants submit that the plaintiffs had not registered the power of attorney in the Teraview System before closing and, as a result, they were not ready, willing and able to close. A screenshot of the Teraview System shows that on the day of closing, the power of attorney was an instrument in progress. Before the end of day, the defendants’ lawyer sent a letter in which he took the position that the Agreement was void ab initio.

[25] The defendants rely upon the decision of J. Macdonald J. in Reviczky v. Meleknia, 2007 CarswellOnt 8258 in support of their submissions with respect to the power of attorney. In this case, a fraudster acted pursuant to a fictitious power of attorney and posed as Mr. Reviczky’s relative to sell the property to another victim of the fraud. In that case, the power of attorney was registered. However, J. Macdonald J. noted that under the Land Titles Act, registration of the power of attorney is permissive, not mandatory. Section 70(2) of the Land Titles Act provides that a power of attorney “may be registered” in the prescribed manner. I do not agree that Reviczky has any application to the motion before me.

[26] The evidence is clear that the plaintiffs were ready and willing to close the transaction. The evidence of Ms. Hoang, their real estate lawyer, is that she had completed all the required steps on the Teraview System before five o’clock p.m. on July 18, 2017. The defendants did not cross-examine Ms. Hoang on her affidavit.

[27] There is no evidentiary basis for me to conclude that the plaintiffs were not ready, willing and able to close the transaction on the closing date. The execution of the Agreement by Ms. Zou pursuant to the power of attorney does under relieve the defendants from their obligations under the Agreement. There are no genuine issues requiring a trial in relation to the power of attorney.

Is there a genuine issue requiring a trial in relation to whether the plaintiffs misrepresented the floor area of the Property?

[28] The defendants submit that the plaintiffs misrepresented the floor area of the Property. They point to the MLS listing which states that the approximate square footage for the Property is 2000-2500. The defendants submit that this reference in the MLS listing was not qualified by the words “living space” and that the basement area was clearly not included in the estimated square footage.

[29] One of the exhibits to the affidavit of Mr. Sanyal is an appraisal of the Property that was obtained by the defendants which disclosed the square footage of the Property to be 2,154 for the main floor and the second floor. The basement was not included. This is within the range that was stated in the MLS listing.

[30] The defendants also rely upon a floor plan for the Property that was prepared for use on the subsequent sale which showed that the square footage of the Property was 2,318 sq. ft. The defendants submit that this should have been included in the original MLS listing. I disagree with this submission. There was no obligation on the part of the plaintiffs to specify the precise area of the Property in the MLS listing. The evidence shows that the defendants inspected the Property for one hour on April 23, 2017. It was for the defendants, as purchasers, to investigate, if they were not satisfied with the description of the Property in the MLS listing.

[31] There is no evidence that the plaintiffs misrepresented the square footage of the Property. There is no genuine issue for trial in this regard.

Is there a genuine issue requiring a trial in relation to whether the plaintiffs failed to deliver a survey?

[32] The Agreement includes a provision in paragraph 12 that states, in part:

Buyer shall not call for the production of any title deed, abstract, survey or other evidence of title to the property except such as are in the possession or control of Seller. If requested by Buyer, Seller will deliver any sketch or survey of the property within seller’s control to Buyer as soon as possible and prior to the Requisition Date.

[33] The defendants had included in their offer as part of Schedule A the following provision:

Seller agrees to provide, at his own expense within seven (7) banking days, an existing survey of the said property showing the current location of all structures, buildings, fences, improvements, easements, rights-of-way, and encroachments affecting said property. The Seller will further deliver, on completion, a declaration confirming that there have been no additions to the structures, buildings, fences, and improvements on the property since the date of this survey.

This provision was struck out and initialed by the parties before the Agreement was made and it did not form part of the Agreement. The plaintiffs submit that, as a result, they had no obligation to provide a survey, even if one existed.

[34] I disagree with the plaintiffs’ submissions in this regard. Notwithstanding that the proposed provision in Schedule A was struck out, paragraph 12 of the Agreement remained. This provision called for the plaintiffs to deliver a sketch or survey of the Property if one is within their control, if requested by the defendants.

[35] In Mr. Sidker’s letter of July 5, 2017 he requested an up-to-date survey of the Property. The response from the plaintiffs’ real estate lawyer was that a survey will not be provided. If the plaintiffs were in the possession or control of a survey (there was no evidence on this point, one way or the other), this response would not have been in compliance with paragraph 12 of the Agreement.

[36] The defendants submit that the plaintiffs breached the agreement by not providing a survey upon request and, as a result of this breach, they were entitled to treat the Agreement as being null and void ab initio. The defendants also submit that as a result of this breach, the Agreement was repudiated by the plaintiffs’ failure to provide a survey and that the defendants, by failing to close, accepted this repudiation and elected to treat the Agreement as at an end.

[37] There is a distinction between “rescission” and “repudiation”. Rescission allows the rescinding party to treat the contract as if it were void ab initio by some vitiating element. The remedy of rescission is available when a party has made a false or misleading representation. See Ball v. 189557 Ontario Inc., 2016 ONSC 3224 at para. 52.

[38] Repudiation occurs by words or conduct showing an intention not to be bound by the contract: Ball at para. 53; Guarantee Co. of North America v. Gordon Capital Corp., 1999 CanLII 664 (SCC), [1999] 3 S.C.R. 423 at para. 40; Jedfro Investments (U.S.A.) Ltd. v. Jacyk Estate, 2007 SCC 55, [2007] 3 S.C.R. 679 at para. 20.

[39] In Ball, at para. 61, Rasaiah J. cited the following passage from the decision of the Court of Appeal in Place Concorde East Ltd. Partnership v. Shelter Corp. of Canada Ltd., 2006 CanLII 16346 at paragraph 51:

A breach that allows the non-repudiating party to elect to put an end to all unperformed obligations of the parties is an exceptional remedy that is available only in circumstances where the entire foundation of the contract has been undermined, that is, where the very thing bargained for has not been provided.

[40] The plaintiffs’ failure to provide a survey, if one was in their possession, was not a breach of the Agreement that substantially deprived the defendants of the benefit of Agreement. This breach was not one that showed that the plaintiffs intended not to be bound by the Agreement.

[41] I conclude that there is no genuine issue requiring a trial in relation to whether the plaintiffs’ failure to provide a survey allowed the defendants to elect to treat the Agreement as being at an end and justified the defendants’ failure to close the transaction.

Is there a genuine issue requiring a trial in relation to the effect of striking out certain provisions in the defendants’ original offer to purchase the Property?

[42] In their factum, the defendants submit that the legitimacy and propriety of clauses in Schedule A to the Agreement that were struck out and initialed by hand before the Agreement was finally executed, without a written and fully signed waiver, raises genuine issues requiring a trial. In this regard, the defendants rely upon evidence that on the subsequent sale of the Property by the plaintiffs, conditions in Schedule A to the agreement of purchase and sale in respect of that transaction were removed by a signed and written waiver.

[43] No authority was provided to me to support the defendants’ submissions in this respect. I do not accept the defendants’ submission that the fact that provisions that the defendants included in their offer to purchase the Property were struck out by hand and initialed raises any issue that is relevant to whether the Agreement is valid and enforceable. There is no genuine issue requiring a trial in this respect.

Is there a genuine issue requiring a trial in relation to the plaintiffs’ failure to obtain an appraisal of the Property when it was re-listed for sale?

[44] The defendants submit that the plaintiffs’ failure to obtain appraisals of the Property when it was re-listed for sale raise genuine issues requiring a trial with respect to whether the plaintiffs properly mitigated their damages, and that these matters should be left to the trial judge to adjudicate.

[45] In Novotny v. Ahmaddi, 2018 ONSC 7310, Perell J. addressed at paras. 18-20 the obligation of a plaintiff to prove damages in an action involving an abortive real estate transaction:

In an abortive real estate action, a successful plaintiff must prove the quantum of his or her damages from the failure of the transaction to close, but the onus is on the defendant to prove any failure to mitigate. The proper course is for plaintiff to adduce evidence of the contract price and of the market price or resale price upon which he or she relies in establishing the loss of bargain and then the onus is on the defendant to show, if he or she can, that if the plaintiff had taken certain reasonable mitigating steps, then the innocent party’s losses would be lower.

Where it is alleged that the plaintiff has failed to mitigate, the burden of proof is on the defendant, who needs to prove both that the plaintiff has failed to make reasonable efforts to mitigate and that mitigation was possible.

In assessing the innocent party’s efforts at mitigation, the courts are tolerant, and the innocent party need only be reasonable, not perfect; in deciding what is a reasonable way to mitigate the effects of a breach of contract, the innocent party is not to be held to too nice a standard; it need only act reasonably, using what it knows then, without hindsight, and it need not do anything risky.

[46] The defendants have failed to show that the plaintiffs failed to act reasonably by taking the steps that they did to sell the Property. The plaintiffs were not under any obligation to obtain an appraisal of the Property. The evidence shows that the plaintiffs exposed the Property to the marketplace for a reasonable period of time and that they ultimately accepted the highest offer that they received, after negotiations with the purchaser that resulted in an increase to the purchase price that was first offered.

[47] The defendants have failed to show that there is any genuine issue requiring a trial in relation to the plaintiffs’ actions to mitigate their damages.

Is there any genuine issue requiring a trial in relation to the credibility of the plaintiffs?

[48] The defendants submit, generally, that the evidentiary record before me is insufficient to fairly and justly adjudicate the issues because of conflicts in the evidence. The defendants submit that the plaintiffs have not come to court with clean hands and cannot be believed.

[49] In support of this submission, the defendants point to evidence tendered by the plaintiffs that the power of attorney was registered in the Teraview System when, they submit, it was not. I do not accept that this discrepancy, if there is one, raises any serious issues with respect to the plaintiffs’ credibility. The evidence from the plaintiff’s real estate lawyer, Ms. Hoang, is that she had completed all of the required steps on the Teraview System before the time for closing. A screenshot from the Teraview System on the closing date shows that the power of attorney was an “instrument in progress”.

[50] In my view, there are no genuine issues requiring a trial in relation to issues with respect to the credibility of the plaintiffs.

Have the plaintiffs proven their damages?

[51] If an agreement of purchase and sale is silent on the disposition of the deposit and the purchaser defaults, the deposit is forfeited to the vendor: Iyer v. Pleasant Developments Inc., 2006 CanLII 10223 (ON SCDC), 2006 CarswellOnt 2050 (Div. Ct.) at paras. 7-8.

[52] Given the defendants’ default under the Agreement, the plaintiffs are entitled to payment of the deposit in full.

[53] Where a purchaser defaults under an agreement of purchase and sale, the purchaser is entitled to the difference between the contract price and the market price at the time of the breach. This is calculated on the basis of a finding of the highest price obtainable within a reasonable time after the contractual date for completion following the making of reasonable efforts to sell the property commencing on that date. What is reasonable, in each instance, is a question of fact to be decided on the basis of all relevant market circumstances. See 100 Main Street East Ltd. v. W.B. Sullivan Construction Ltd. (1978) 1978 CanLII 1630 (ON CA), 20 O.R. (2d) 401 (C.A.) at para. 73.

[54] The resale price of $797,000 was the highest price obtainable by the plaintiffs within a reasonable time after the contractual date for completion, following the making of reasonable efforts to sell the property commencing on that date. As such, the plaintiffs are entitled to damages based upon the difference between the contract price ($971,000) and the resale price ($797,000) in the amount of $174,000. The plaintiffs are entitled to forfeiture of the deposit of $40,000. The balance of the plaintiffs’ damages for diminution in the selling price of the Property is $134,000.

[55] The plaintiffs are also entitled to damages based upon the increase in the commission fee that they paid to the real estate agent who represented them on the resale. The commission fee that was paid to the plaintiffs’ new agents calculated as 2.5% of the sale price was $22,515.25 inclusive of HST. The commission fee that would have been paid to the plaintiffs’ agent under the terms of the Agreement was a flat fee of $1,999 plus HST, a total of $2,258.87. The difference is $20,256.38.

[56] The plaintiffs have proven that they suffered damages in the amount of $154,256.38. There is no genuine issue requiring a trial in this respect.

Are the defendants entitled to a stay of a judgment against them until final disposition of the third party claim?

[57] At the hearing of this motion, counsel for the defendants submitted that if summary judgment were to be granted in favour of the plaintiffs, the defendants are entitled to a stay of this judgment until after disposition of their third party claim against the plaintiffs’ real estate agent, REAO Realty Inc., and against the defendants’ real estate agent, Raj Paramasamy.

[58] The defendants’ claims are based upon allegations that these agents breached contractual and fiduciary duties owed to the defendants through negligence, misrepresentation, and lack of disclosure. The claims against the plaintiffs’ agent includes claims that there was a misrepresentation in the MLS listing concerning the square footage of the Property, a survey was not provided upon request, the letter of requisitions was not answered in a timely way, and the Agreement was executed through a power of attorney. The defendants claim declaratory relief, indemnification for any liability in the main action, and punitive and exemplary damages.

[59] Rule 20.08 of the Rules of Civil Procedure provides:

Where it appears that the enforcement of a summary judgment ought to be stayed pending the determination of any other issue in the action or a counterclaim, cross-claim or third party claim, the court may so order on such terms as are just.

[60] In support of their submission, the defendants rely upon a decision of Dunphy J. in Extreme Venture Partners Fund I LP v. Varma, 2018 ONSC 4629. In that case, several defendants brought a motion for summary judgment seeking dismissal of the plaintiffs’ claims against them, including claims in conspiracy. In response to this motion, the plaintiffs submitted that their conspiracy claims against the moving parties cannot be severed from their claims against the defendants who were not parties to the summary judgment motion. Dunphy J. held that disposition of the conspiracy claim requires findings of fact and law to be made in respect of the plaintiffs’ claims against other defendants who are not parties to this motion. Dunphy J. was unable to find that the issues that he was required to decide on the summary judgment motion can be severed from the issues that will be before the trial judge and, given the apparent risk of conflicting decisions, he dismissed the motion for summary judgment.

[61] The reasoning in the decision in Varma is not applicable to the motion for summary judgment that is before me because in that case the motion was brought by some defendants and the action was proceeding to trial against other defendants. There was no request for a stay. The issue was whether the court should grant partial summary judgment in favour of some defendants but not all defendants. The circumstances are different on the motion before me. The plaintiffs do not seek partial summary judgment. The motion for summary judgment, if granted, will fully dispose of the main action.

[62] The defendants also rely on a decision of M. McKelvey J. in Miller v. Wang, 2018 ONSC 7668. The facts in Miller are very similar to the facts on the motion before me. In Miller, the plaintiffs sold a property to the defendant, who was one of seven bidders. The defendant did not complete the purchase. The plaintiffs relisted the property and sold it for a price that was more than $200,000 less than the original sale price. The plaintiffs commenced an action for damages. The defendant brought a third party action against the real estate agent and alleged that the agent pressured and induced the defendant to purchase the property, in breach of their fiduciary obligations. The plaintiffs brought a motion for summary judgment against the defendant. The third parties did not participate on the hearing of the motion. The defendants submitted that any judgment should be stayed pending disposition of the third party claim.

[63] In Miller, M. McKelvey J. held that although the main action and the third party action arise out of the same transaction, the third party action is focused on the alleged improper conduct of the real estate agent, and there was no significant overlap in the issues to be decided in the main action and the third party action. J. McKelvey J. also addressed the issue of prejudice to the plaintiff if there were to be a stay of the judgment in the main action:

It is clear that the defendant would benefit from a stay of the judgment in the main action. This would mean that the third party action would be tried and if the defendant is successful, she would have the benefit of a recovery from the third party at the point in time when she becomes obligated to pay the plaintiffs in the main action. This, however, must be considered together with the potential prejudice to the plaintiffs of a stay. Although the defence maintains that they will move the third party action along promptly, there will inevitably be a significant delay before the third party action is tried. During the period of this delay, the plaintiffs will be deprived of the opportunity to execute on their judgment. The plaintiffs will therefore be forced to run a risk that the defendant’s financial circumstances could deteriorate over the period of the delay, and their ability to collect on the judgment could be significantly compromised as a result of the stay. The plaintiffs in this action are innocent of any wrongdoing. There has been a clear breach of the agreement by the defendant. In the circumstances of this case, taking all the circumstances into account, including the potential prejudice to the plaintiffs’ position on enforcement of the judgment, I have concluded that the interests of justice do not support the imposition of a stay. I am therefore not prepared to grant of the defence request in this regard.

[64] The jurisdiction to grant a stay is discretionary and depends on the facts of the case. Among the factors to be considered is whether the counterclaim or, as in this case, the third party claim, appears to be meritorious: Zucchetti Rubinetteria S.P.A. v. Natphil Inc., 2011 ONSC 2275 at para. 15; affirmed 2011 ONCA 726.

[65] There is some overlap between the issues that I decided on this motion and the claims made in the third party claim. However, I have concluded that there was a clear breach of the Agreement by the defendants by failing to complete the transaction. In my view, given this conclusion, the potential prejudice of non-payment to which the plaintiffs would be exposed if they were to be delayed in their ability to enforce a judgment until the final disposition of the third party action is the decisive factor that, in this case, militates against a stay of enforcement of the judgment.

[66] In my view, the interests of justice do not support the imposition of a stay of enforcement of the judgment pending determination of the issues raised in the third party action, and I exercise my discretion to decline to order a stay of enforcement of the judgment.

Should the counterclaim be dismissed?

[67] In paragraph 17 of their counterclaim, the defendants claim (a) a declaration that the Agreement is null and void, unenforceable and of no consequence whatsoever; (b) a declaration that the plaintiffs breached their obligations under the Agreement; (c) rescission of the Agreement and return of their deposit of $40,000 held by the listing brokerage, REAO Realty Inc.; and (d) costs of the counterclaim.

[68] Although the plaintiffs did not move for summary judgment dismissing the defendants’ counterclaim in their Notice of Motion, they ask that the counterclaim be dismissed on this motion. In this respect, the plaintiffs submit that if they were to be successful on their motion for summary judgment, the claims made in the counterclaim would also have been decided and, accordingly, the counterclaim should be dismissed.

[69] I agree that the claims made by the defendants in paragraphs 17 (a), (c), and (d) of their counterclaim have been decided on this motion for summary judgment. However, one of the claims made by the defendants in their counterclaim is a declaration that the plaintiffs breached the Agreement. I held that the plaintiffs may have breached the Agreement by responding to the defendants’ request for a survey as they did. It is possible that this claim could survive a summary judgment in favour of the plaintiffs, insofar as it relates to paragraph 12 of the Agreement and to the request for a survey. I decided that a breach of the Agreement by failing to provide a survey if one was available does not give rise to the defendants’ right to rescind the Agreement or to treat it as having been repudiated. I did not did not decide that the defendants were precluded from seeking a remedy in damages.

[70] Because the defendants’ claim for a declaration that, in relation to the survey, the plaintiffs breached the Agreement could survive a summary judgment on this motion, I decline to order that the counterclaim is dismissed.

Disposition

[71] For these reasons, I grant the plaintiffs’ motion and grant summary judgment for the following relief:

a. A declaration that the Agreement is valid and subsisting and that the defendants breached their obligations under the Agreement;

b. A declaration that the deposit of $40,000 paid by the defendants is payable to the plaintiffs as a result of the defendants’ breach of the Agreement;

c. Damages in the amount of $154,256.38.

d. Applicable prejudgment and postjudgment interest.

[72] If the parties are unable to resolve costs, the plaintiffs may make written submissions within 15 days. The defendants may make written responding submissions within 15 days thereafter. If so advised, the plaintiffs may make brief written reply submissions within five days thereafter.

Cavanagh J.

Date: January 29, 2019