Court File and Parties

COURT FILE NO.: CV-18-00609707-0000 DATE: 20200605 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

MOHMMAD DANESH Plaintiff – and – ELAHE VAHED and REMAX CROSSROADS REALITY INC. Defendants – AND BETWEEN – ELAHE VAHED Plaintiff by Counterclaim – and – REMAX CROSSROADS REALTY INC., MOHMMAD DANESH and MICHAEL BURY Defendants to the Counterclaim

Counsel: Esmaeil Mehrabi, for the Plaintiffs Self-represented, Elahe Vahed Joseph Juda, for Remax Crossroads Realty Inc. Michael R. Kestenberg, for Michael Bury

HEARD: December 2, 2019

M. D. FAIETA j.

REASONS FOR DECISION

[1] This proceeding arises from an agreement to purchase a condominium that failed to close after the closing date had been extended twice. The vendor claims that there was never a second extension agreement and, that if it existed, then it was invalid. The purchaser commenced this action and he and the defendants by counterclaim each bring a motion for summary judgment. For reasons described below, their motions have been granted.

BACKGROUND

[2] By agreement of purchase and sale dated May 18, 2018, the plaintiff, Mohmmad Danesh, agreed to purchase a condominium (the “Condominium”) from the defendant, Elahe Vahed, for the sum of $410,000.00. Danesh paid a deposit of $20,000 which was to be held by the listing broker, the defendant ReMax Crossroads Realty Inc.(“ReMax”), in trust pending the completion of the purchase on July 28, 2018 (the “APS”).

[3] Danesh and Vahed agreed to extend the closing date to September 6, 2018. The amending agreement also provides for Danesh to pay an additional $20,000.00 deposit. It states:

Buyer agrees to pay additional deposit of $20,000.00 within 24 hours of acceptance of this amendment payable to Purchaser’s lawyer trust account. Purchaser’s lawyer will release that deposit to be used as a deposit of vendor’s real estate purchase.

[4] By letter dated July 24, 2018, Danesh delivered the additional $20,000 deposit to his lawyer, Michael McKee. The letter, addressed to McKee, states:

This letter is to confirm that I, Mohammed Danesh, authorize you to release the additional deposit paid by me to your trust account ($20,000.00) to the vendor or as her direction.

[5] Vahed acknowledges that she picked up the $20,000 deposit from McKee’s office.

[6] As the September 6, 2018 closing date approached, Danesh states that it became evident to him that he did not would not secure mortgage financing in time for the closing date.

[7] One day prior to the closing date, McKee referred Vahed to the defendant by counterclaim Michael Bury.

[8] Vahed advised Bury by email on September 5, 2018 that she was ready to proceed with the closing as scheduled. By email dated September 5, 2018 at 4:27 pm, Vahed stated:

I am ready for closing my apartment and delivery the key. Please update me.

[9] On September 5, 2018, Bury was advised by McKee that Danesh would not be in a position to close the transaction on September 6, 2018 due to financing issues. Bury responded to Vahed’s earlier email as follows at 4:50 pm:

The purchaser’s solicitor advised us that the mortgagee cancelled the mortgage. As a result, the deal is not going through.

[10] On September 6, 2018, McKee advised Bury that Danesh sought an extension of the closing date. Bury relayed this information to Vahed at 12:14 pm on September 6, 2018. He stated:

I am advised that the purchaser is seeking an extension of the closing date to September 25ht. Please advise whether this is acceptable to you.

[11] Vahed states that she was upset to learn that Danesh sought another extension:

I was extremely upset because I had made a commitment to invest with my sister on a business using the capital from the sale of my unit. I had also made a new living arrangement which required me to move out of my property.

[12] Nevertheless, Vahed advised Bury by email dated September 6, 2018, at 2:34 pm, that an extension would be acceptable on certain conditions. She stated:

I will give him the extension until September 25, 2018 on following condition:

• He has to pay all my carrying cost on the property until 25 th September and then if he won’t close by 25 th September I need the undertakings from the lawyers that he acknowledge that he is going to loose $40,000 deposits to me automatically.

[13] About an hour later, Vahed sent Bury an email indicating that her carrying costs were “Mortgage $1338.16, Maintenance Fee $347.20, Tax $173, Total $1858.36”.

[14] After receipt of Vahed’s email, Bury relayed Vahed’s terms for an extension of the closing date to McKee. By telephone call, McKee confirmed that Danesh agreed to the terms of the extension as requested by Vahed.

[15] The above terms of the extension were confirmed by a letter dated September 6, 2018 from Bury to McKee (“Extension Letter”). The letter states:

Further to the email exchange with your office today and telephone discussions, I am writing to confirm that Ms. Vahed has agreed to an extension of the closing in the above matter to September 25 th , 2018 with conditions (ie. payment by your client of the carrying costs (Mortgage $1338.16, Maintenance Fee $347.20, Taxes $173 until closing, forfeiture of deposit if the deal does not close) and you have agreed to these terms.

[16] Bury states that the letter is a confirmation of the telephone call that he had with McKee during which McKee agreed, after obtaining instructions for his client, to the terms proposed by Bury.

[17] Bury testified that he did not email the letter but rather he hand delivered the above letter to McKee sometime after 4:00 pm on September 6, 2018. This is confirmed by McKee who states that he specifically recalls Bury delivering the above letter to his office on September 6, 2018 because of the amount of stress involved at the time and the fact that the file did not close.

[18] Vahed sent Bury an email on September 7, 2018 at 2:35 pm:

Yesterday was my closing day. I did not receive any reply. I lost money. I am going to take action.

[19] Bury states that he was unable to reach Vahed by telephone to advise her that the closing date had been extended and to arrange for her to come to his office to formally retain him.

[20] As he was unable to reach her by telephone, Bury sent Vahed an email at 10:29 am on September 8, 2018 advising her of the above. The email states:

I have been advised by counsel for the purchaser that they will be ready to close early next week and have agreed to carry any costs as discussed.

When can you come to our office next week?

[21] Bury received no response from Vahed. Bury followed up by email on September 10, 2018.

[22] A few hours later, Vahed responded by email to Bury:

I am trying to call you but cannot hold on you. Can you plz call me …

[23] Bury states that he had missed calls or voice messages logged on his cell phone. He tried to call Vahed back at the number she provided but once again was unable to reach her. He sent her the following email at 6:48 pm:

What number are you calling? I am at … . I did not see any missed calls from you today.

[24] Vahed states:

On September 8, 2018, I received an email from my lawyer stating that the buyer has agreed to pay for carrying cost. I was reluctant to accept the offer because the damage was already done. I had lost my living arrangement and my investment opportunity because of the buyer’s default.

I received a call from my agent same day, asking me if I would agree to give access to a property appraiser sent by a financial company for the Buyer to visit my condo unit. This was a clear indication that the buyer’s financing is still in process and the buyer’s mortgage approval is not in place yet. This was also in contradiction to the email I received from my lawyer which stated that they buyer’s financing is ready, and they are ready to close next week. Knowing all the above, I refused to provide access to another appraiser. For me the buyer defaulted on September 6, 2018 and the deal was dead since then. (contrary to Mr. Danesh claim I never permitted access to the appraiser).

[25] Bury spoke with Vahed on the morning of September 11, 2018. He states:

She sounded very erratic and claimed she was unsure of whether she wanted to go ahead with the deal due to her “losses”. Ms. Vahed did not make clear to me what those losses were. More importantly I advised her that the purchaser had already agreed to her terms and that closing had been extended to September 25, 2018, which I had confirmed in writing in accordance with her instructions. I advised her that it was imperative for us to formally meet so that I could open a file with all of her particulars as my involvement had been limited to that point to protecting her interest in anticipation of meeting with her. Ms. Vahed was extremely noncommittal during our telephone call and said she would think about it and her options.

[26] On September 11, 2018, McKee advised Bury that his client had secured mortgage financing. He stated:

Please be advised that we are in receipt of Mortgage Instructions from a private mortgagee and our client is ready to close the transaction.

Kindly send us Statement of Adjustments and your closing package.

I must bring your attention to this fact that you client agreed to extend the closing date to the 25 th day of September, 2018.

Our client is allowing your client to remain at the property until the 25 th with no rent, it being agreed that we will hold the sum of $10,000 which will be released to you on the 25 th of September if your client moves out on the 25 th .

Your client will pay $500/day if she does not move out of the unit on the 25 th .

[27] About thirty minutes later, Bury forwarded the above message to Vahed along with his own message:

I have been contacted by counsel’s office for the purchaser.

They are ready to close this week.

As you know you previously agreed verbally on September 6 th to an extension of September 11 th with Ms. Jamileh Sabbagh and the real estate agent. You then further agreed to a September 25 th extension in writing with penalties (ie. the carrying costs) which the purchaser agreed to pay. The purchaser is now ready to close so I will need your immediate instructions to finalize the closing.

[28] Vahed responded to Bury on September 11, 2018:

Mr Bury consequences of to their defaults and not closing on time impacted me financially and psychologically. Other than lost opportunity for investment that cost me lots, I lost the space that I had been supposed move to on September 6 th . We offered them extension until 25 th but they never been agreed to on that time so that arrangements isn’t available to them anymore. I am working hard to find something as soon as possible.

[29] Mr. Bury responded a few minutes later with the following message:

Thank you for your email. But there appears to be some confusion. You agreed to an extension of September 25 th with penalties. You provided the details of the carrying costs which I forwarded to counsel for the purchaser. They agreed to the extension with penalties and I advised you of this in writing.

[30] On the afternoon of September 11, 2019, Vahed and Bury exchanged the following emails:

Vahed: I checked all my correspondence with you I don’t see you never mentioned to me they were agreed to my conditions for extension of September 25 before Sep 6. Either you are confused or I can’t find that email please advise.

Bury: On September 6h via email you agreed to an extension of September 25 th with terms (ie. Carrying costs) and I forwarded this to counsel for the purchaser.

Bury: Please see below email where you agreed to the September 25 th extension on September 6 th .

Vahed: What kind of lawyer are you. You never told me they accepted my conditions. Relay is not acceptance.

Vahed: Please look at date on the email is 2 days after closing. Didn’t say carrying cost until when. Does say closing next week shows definitely wasn’t talking about 25 th of September that was being discussed. Didn’t mention if they were agreed with undertaking that lose their deposit on September 25ht. I put you on notice that as your client put your best intentions to me. I am getting suspicious to your intentions.

Bury: The email chain clearly sets out the purchaser’s position. While they originally sought an extension to September 25 th and agreed to carry any associated costs, they were able to make financial arrangements for this week. Rest assured that I am representing your interests and on that basis please provide your instructions as to whether or not you are going to close this transaction and in what manner as I need to reply to counsel for the purchaser.

[31] On the evening of September 11, 2018, Bury and Vahed’s listing agent, Vahid Khorramnik, exchanged email messages:

Khorramnik: I am the agent who is representing Ms. Vahed. She forwarded me emails you are sending her and I feel the purchaser along with your help trying bullying her on this transaction. I was witness that purchaser defaulted on his obligation to close the deal on September 6 th and they never been agreed to any agreement until Saturday (2 days after closing) that you sent email to Ms. Vahed that they are willing to close this week. However results of their actions Ms. Vahed lost all her arrangement to purchase or reside in new home. The purchaser should understand they are the one defaulted and they are the one should be patient until my client can find out replacement for her situation. Please don’t make her life harder and tell other side that she is trying hard to find something to buy or figure out how she can get out from this situation.

Bury: Thanks for your email. Contrary to your suggestions to which I take exception, I am not attempting to bully anyone with respect to this deal. Given that we have never met or had any contact, your comments are unfortunate. As you know, counsel for the purchaser has contacted me with respect to our position today. I have a professional obligation to respond based on the instructions I receive from Ms. Va. If she is not in a position to provide instructions at this time, I will advise accordingly and will await her further direction in the matter.

[32] On September 13, 2018, Bury sent the following message to Vahed:

I have not heard back from you as of this morning. As I indicated previously, we need to provide a response to the purchaser with respect to your position. In the event that I do not hear back from you by 5:00 PM today, I will assume that you do not require my assistance and will advise counsel for the purchaser to communicate directly with you.

[33] On September 14, 2018, Bury sent the following email to Vahed:

As I have not heard back from you, I will assume that my services are not required to assist you in this matter. I will advise counsel for the purchaser of this and you and they can communicate directly.

[34] On September 13, 2018 Vahed, with the assistance of her agent, Vahid Khorramnik, made an offer to purchase a house in Newmarket, Ontario. This offer was accepted on September 14, 2018. A deposit of $20,000 was paid. The purchase, conditional on financing, was to be completed by September 25, 2018. Vahed states that the vendor wished to lease back the house for two months at a price of $1,500 per month. Vahed states that she spoke with Danesh. She sought his agreement to remain in the Condominium for two months at $1,500 per month. Danesh refused. She states “That was the time I realized they were not acting in good faith to reach an agreement with me”. Vahed cancelled the agreement to purchase the Newmarket property.

[35] Once McKee became aware that Vahed had retained Bobby Vakili, he sent a requisition letter to Vakili on September 20, 2018. On the same day, Vakili provided his response to the various requisitions by letter. The subject line of Vakili’s letter states that the closing date is September 25, 2018.

[36] On September 21, 2018, Vakili and McKee exchanged several messages:

(a) Vakili sent a one page fax to McKee which indicated that Vahed wanted to continue to live in the Condominium after closing for an additional two months for $1,500 per month in rent. He states:

We understand from our client that the terms of the extension agreement was that your client was to provide our client with a credit on the Statement of Adjustments for approximately $1,800.00 for the extension fee and will provide post-dated cheques for October 1 st and November 1 st for $1,500.00 for rent. Please confirm same with your client as soon as possible. Once we are in receipt of the confirmation, Statement of Adjustments will be provided.

(b) McKee responded to Vakili by a one page fax:

Our client is agreeable to the extension fee of $1,800.00. Our client’s monthly mortgage payment is $2,050 and Common Expenses $347.20+property tax. Our client cannot accept your client’s offer for $1,500.00 rent. Our client is requesting $2,200 monthly rent. Kindly send us Statement of Adjustments ASAP.

(c) McKee sent a second letter by fax to Vakili:

Please be advised that your client extended the closing date to the 25 th day of September, 2018. We have requested you numerous of times to send us the Statement of Adjustments and vendor’s signed documents. We explained you that our Private Lender’s Solicitor is requiring the said documents to be able to release the mortgage funds to us. Your client must be aware of this matter that our client wont be liable for any late closing since you di not provide us with the Statement of Adjustments and vendor’s signed documents. Your client’s requirement of renting the unit for two months is not in the Agreement of Purchase and Sale, kindly allow the realtors to deal with it.

(d) Vakili sent a one page fax attaching Vahed’s Statement of Adjustments, adjusted as of September 25, 2018 and providing for an extension fee of $1,800.00.

[37] On September 24, 2018, Vakili took the position that the APS had terminated on September 6, 2018. Vakili and McKee’s law clerk, Nina Raposo, exchanged the following emails on that day:

(a) Vakili – Can you please provide me with the extension agreement that was executed between the parties extending closing to September 25, 2018?

(b) Raposo – Ms. Vahed’s solicitor at the time, confirmed that she agreed to extend the closing to the 25 th of September with the following conditions:

• Mortgage payment of $1,338.16 • Maintenance fee of $347.20 • Property tax of $173.00

It was between Ms. Vahed and her solicitor. Ms. Vahed should have it in her email.

(c) Vakili – There must be a signed extension agreement between the parties and my client has informed me that one does not exist. If your client failed to tender and close on the last closing date and no extension exists between the parties, then your client is in default and liable for damages. Please provide me with the extension agreement as you have a copy of it if one exists.

(d) Raposo – We did not deal with the vendor since she had a solicitor representing her, and Mr. Bury, the solicitor for Ms. Vahed, told us that his client, Ms. Vahed, extended the transaction on the conditions that we accepted and you also mentioned in your statement of adjustments.

(e) Vakili – I am requesting the extension agreement between your office and Mr. Bury’s office. You mentioned that you accepted the conditions proposed by Mr. Bury’s office, please send me the relevant correspondence and extension agreement.

(f) Raposo – The extension agreement was a verbal agreement made between Mr. Bury and Mr. McKee over the telephone. Mr. Bury informed Mr. McKee that his client, Ms. Vahed agreed to the extension on the oncitions which I sent you earlier. Please contact Mr. Bury at … or email him at … if you need his documents regarding the extension.

[38] On September 24, 2018, Vahed and Bury exchanged the following emails:

Vahed: I asked my agent called you bcs I might take action to go to law society. You was introduced me by Jamileh Sabbagh. I never met you, I don’t know if you are real or not. My buyer who defaulted on the deal they have with me, they claim that they got extension of at that time and evidence you send me does not show any extension between two parties. Apparently, Jamileh is representing other side as well. She raise so many concern about how you treated me so I want to go to law society to get answer of all of these.

Bury: Thank you for your email. I have previously communicated all correspondence and information conveyed between parties. We have spoken on the telephone, we have exchanged emails. If you would like to meet in person to clarify any further issues you have, I would be pleased to meet with you.

[39] On September 25, 2018, Danesh’s solicitor advised Vakili that Danesh was ready, willing and able to close the transaction.

[40] On September 25, 2018, Vakili advised McKee by letter that Vahed would not be closing the transaction as the APS had expired on September 6, 2018 as the extension agreement had not been signed by the parties. He stated:

Further to the above noted transaction, my client has informed me that an extension agreement was never agreed to between her former lawyer and your office. Yesterday, I repeatedly asked you to provide me with the extension agreement between the parties and you advised that a written extension agreement was never executed and the extension agreement was verbal between my client’s former lawyer, Mr. Bury, and yourself.

My client proposed extension terms to her former lawyer, and those terms were never accepted by your client and/or were never communicated to your client for acceptance. In addition, as you must certainly know, a verbal extension agreement is not valid in real estate transactions.

Accordingly, this transaction was at an end on September 6, 2018 as your client was in default of the agreement of purchase and sale and a valid binding agreement was never reached. My client will seek to mitigate her damages by relisting the property for sale, will seek forfeiture of the deposit and will hold our client responsible for all damages arising therefrom.

[41] Bury received no further communication from Vahed until December 18, 2018.

[42] On December 18, 2018, Vahed sent Bury the following email:

Please take note that the transaction on the subject property is being litigated. I am respectfully asking you to immediately provide me with details of your communications with Michael McKee for the period when you were representing me on this transaction.

[43] On December 19, 2018, Bury and Vahed exchanged the following emails:

Bury: … Please find attached the relevant correspondence to Mr. McKee dated September 6, 2018. You already have our other email exchanges and explanations.

Vahed: Can you plz explain for me know why you send that letter to the other side? Since my condition wasn’t only carrying cost? And you never mentioned my other condition on the letter?

Bury: Please see your email below. My letter addressed your points.

Vahed: How about the below part of my email never been mentioned? I need the undertakings from the lawyers that he acknowledge that he is going to loose $40,000 deposite to me automatically .

Bury: My letter confirms both the discussion I had with Mr. McKee regarding this issue and is specifically referenced in the letter, both the loss of the deposit and his agreement to the terms.

Vahed: For the record, First I never been aware of existing of this letter before today (submissions and acceptance). Second point Mr. McKee clearly stated to my lawyer that there was no written agreement and everything was verbal within you and him. My third point as you are a lawyer you must know better than me lawyer undertaking is a very serious action that must be documented and also I supposed to be informed by proper documentation for such acceptance from both lawyers. My forth point, I have been referred by Ms. Jamileh Sabbagh to you how come she can be your law Clear and Mr. McKee law clerk at the same time.

Bury: As you know, we had both multiple email exchanges as well as telephone conversations during an extremely short period of time. Then, you abruptly did not come to my office to finalize my retainer and use my services. Nor did you respond to any of my subsequent communications. I cannot comment on what Mr. McKee told your lawyer as I was not part of that discussion. At this point, I have provided you with all the information I have due to my extremely limited involvement in this matter and cannot be of any further assistance.

[44] In December, 2018, ReMax returned the $20,000 deposit to Danesh after Vahed refused to close the transaction. Danesh agreed to be liable for the deposit amount in the event that he was found to have breached the APS. The deposit funds have been replaced by ReMax and ReMax has undertaken to pay any funds as directed by the Court.

[45] Vahed still owns the Condominium and has refused to answer whether she has taken any steps to sell the Condominium.

[46] Danesh has discontinued his action against ReMax. He brings this summary judgment motion for judgment against Vahed for the following damages:

(a) Return of the additional $20,000 deposit paid directly to Vahed; (b) $2,500 fee paid to his lender; (c) $3,630 fee paid to McKee; (d) $375 fee paid for the appraisal of the Condominium; (e) $25,000 for the increase in the price of the Condominium and loss of opportunity.

[47] Vahed counterclaims against Danesh, ReMax and Bury. She claims:

• $40,000 in general damages against Danesh as a result of the breach of the APS on July 24, 2018 and September 6, 2018; • $100,000 against ReMax for punitive damages for returning the initial $20,000 deposit to Danesh; • $40,000 against Bury for ignoring Vahed’s written instruction to obtain written undertaking from Danesh.

[48] On their motion for summary judgment,

• Danesh and Bury seek an Order dismissing the counterclaim against them; • ReMax seeks: (a) An Order dismissing the counterclaim against ReMax (b) In the event that the Court determines that Danesh is entitled to the deposit an Order directing ReMax to release the replacement deposit funds to ReMax; (c) In the event that the Court determines that Vahed is entitled to the deposit • An Order that Danesh pay $20,000 being the original deposit funds into Court or as ordered by the Court; • An Order directing ReMax to release the replacement deposit funds back to ReMax.

ANALYSIS

[49] Rule 20.04(2)(a) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, states that a 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.

[50] In Hryniak v. Mauldin, 2014 SCC 7, 1 S.C.R. 87 at para. 49, the Supreme Court of Canada stated that:

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.

[51] Rule 20.04(2.1) provides that in determining whether there is a genuine issue requiring a trial, the court shall consider the evidence submitted by the parties and the judge may exercise any of the following powers for the purpose, unless it is in the interest of justice for such powers to be exercised only at trial:

1. Weighing the evidence.
2. Evaluating the credibility of a deponent.
3. Drawing any reasonable inference from the evidence.

[52] In response to affidavit material or other evidence supporting a motion for summary judgment, a responding party may not rest solely on the allegations or denials in the party’s pleadings, but must set out, in affidavit material or other evidence, specific facts showing that there is a genuine issue requiring a trial: see Rule 20.02(2). Each side must “put its best foot forward” with respect to the existence or non-existence of material issues to be tried: see Papaschase Indian Band No. 136 v. Canada (Attorney General), 2008 SCC 14, 1 S.C.R. 372 at para. 11. A court is entitled to assume that the record contains all the evidence that the parties would present if the matter proceeded to trial: see Aronowicz v. EMTWO Properties Inc., 2010 ONCA 96, 98 O.R. (3d) 641 at paras. 17-19.

[53] On a motion for summary judgment, a judge may grant judgment in favour of a responding party, even in the absence of a cross-motion for such relief, so long as it is within the scope of the motion: see Singh v. Trump, 2016 ONCA 747, 408 D.L.R. (4th) 235 at paras. 147, 148.

[54] This motion proceeded on the basis of documentary evidence (about 25 volumes) filed by both parties:

1. Affidavit of Michael Bury, sworn May 29, 2019;
2. Affidavit of Barney Johnson, sworn June 4, 2019;
3. Affidavit of Mohammad Danesh, sworn June 19, 2019;
4. Responding Affidavit of Elahe Vahed, sworn August 19, 2019;
5. Affidavit of Vahi Khorramnik, sworn August 19, 2019;
6. Transcript from the Cross-Examination of Mohmad Danesh, held on November 18, 2019;
7. Transcript from the Cross-Examination of Michael Bury, held on November 18, 2019;
8. Transcript from the Cross-Examination of Elahe Vahed, held on November 18, 2019;
9. Transcript from the Cross-Examination of Barney Johnson, held on November 25, 2019.

[55] In my view this is an appropriate case for summary judgment. The findings of fact and issues can be efficiently and fairly determined given the extensive documentary record and the cross-examinations that were held.

ISSUE #1: DID VAHED BREACH THE APS?

[56] Danesh claims that Vahed breached the APS by failing to close the sale of the Condominium on September 25, 2018. Vahed in her Statement of Defence and Counterclaim states that “there was no agreement in place to amend the closing of September 6, 2018 to September 25, 2018”.

[57] Vahed submits that the Extension Letter was fabricated and it was never delivered by McKee to Vakili on September 6, 2018. She states that whether the Extension Letter was fabricated after September 6, 2018 raises a triable issue. She further states that, in any event, even if the Extension Letter was delivered by Bury to McKee on September 6, 2018, their oral agreement to extend the closing date fails to comply with the Statute of Frauds Act and thus is invalid.

[58] I find that Vahed’s allegation that the Extension Letter was fabricated does not raise a triable issue. First, it would require this Court to find that both Bury and McKee, being officers of the Court, had lied about the existence of the Extension Letter and its delivery. Second, it ignores Vahed’s own evidence that she was told by Bury on September 8, 2018 that Danesh had agreed to carry the additional costs of the Condominium. Third, it ignores McKee’s letter to Bury dated September 11, 2018 where he acknowledges that Vahed had agreed to extend the closing date. Fourth, it ignores Bury’s email to Vahed on September 11, 2018 where he told her that Danesh had agreed to the extension with penalties.

[59] Vahed also submits that the agreement to extend the closing date is invalid on the ground that it was a verbal agreement and, as such, it does not comply with the Statute of Frauds, R.S.O. 1990, c. S. 19, s. 1.

[60] In Erie Sand and Gravel Limited v. Tri-B Acres Inc, 2009 ONCA 709, the Ontario Court of Appeal explained:

48. To be enforceable, s. 4 of the Statute of Frauds requires that an agreement for the sale of lands (or some note or memorandum thereof) be in writing and signed by the party to be charged. Section 4 reads as follows:

49. No action shall be brought to charge any executor or administrator upon any special promise to answer damages out of the executor's or administrator's own estate, or to charge any person upon any special promise to answer for the debt, default or miscarriage of any other person, or to charge any person upon any contract or sale of lands, tenements or hereditaments, or any interest in or concerning them, unless the agreement upon which the action is brought, or some memorandum or note thereof is in writing and signed by the party to be charged therewith or some person thereunto lawfully authorized by the party. (Emphasis added)

50. The purpose of s. 4 of the Statute of Frauds is to prevent fraudulent dealings in land based on perjured evidence. However, Equity will not allow the Statute of Frauds to be used as an "engine of fraud". It created the doctrine of part performance to prevent the Statute of Frauds from being used as a variant of the unconscionable dealing which it was designed to remedy: see Hill v. Nova Scotia (Attorney General), [1997] 1 S.C.R. 69, [1997] S.C.J. No. 7, at para. 10. The requirements in s. 4 of the Statute of Frauds must give way in the face of part performance because the acts of part performance fulfill the very purpose of the written document -- that is, they diminish the opportunity for fraudulent dealings with land based on perjured evidence. [Emphasis added]

[61] I make several observations.

[62] The APS provides that the closing date may be extended by the parties or their solicitors. It states:

TIME LIMITS: Time shall in all respects be of the essence hereof provided that the time for doing or completing of any matter provided for herein may be extended or abridged by an agreement in writing signed by the Seller and Buyer or by their respective lawyers who may be specifically authorized in that regard.

[63] Vahed authorized Bury to agree to an extension of the closing date on two conditions: (1) payment of carrying costs for the Condominium until September 25, 2018; (2) confirmation that Danesh would lose his deposit if the sale was not completed on September 25, 2018. Contrary to Vahed’s submission, the Extension Letter addresses both conditions. Accordingly, I find that Bury acted in accordance with Vahed’s instructions and that Bury was authorized to extend the APS on the terms contained in the Extension Letter.

[64] Although Bury signed the letter, McKee did not sign or otherwise confirm in writing his acceptance of the terms found in the Extension Letter. Nevertheless, given that Bury signed on behalf of Vahed, and given that Danesh seeks to hold Vahed liable by the terms of the Extension Letter, Vahed is accordingly the “party to be charged” using the language above in Erie Sand. Accordingly, given that Bury signed the Extension Letter on Vahed’s instruction and as her solicitor, Vahed’s Statute of Frauds argument fails.

[65] In any event, it is doubtful that the Statute of Frauds renders unenforceable an oral agreement to extend a closing date. In Dunn v. Trojansek (1972) 2 N.R. 243, para. 4. (Ont. C.A.) aff’d Dunn v. Trojansek (1974) 2 N.R. 243 (S.C.C.), the Court upheld an oral agreement to extend the closing date of a purchase of property. In that case, the sale of a property was to close on the 15 th of April. Prior to the date of closing, the legal secretary for the vendor’s lawyer agreed with the purchaser’s lawyers to extend the closing date to the 22 nd of April. A few hours prior to closing on the 22 nd of April, the vendor terminated the agreement. In upholding the trial judge’s decision to grant specific performance of the agreement, the Ontario Court of Appeal reasoned:

He [the Vendor] himself took no steps to terminate it until the morning of the 22nd, some two hours before the time at which the purchaser's solicitor and the secretary of the vendor's solicitor had agreed to close and therefore he had not exercised the remedy to which he was entitled, that is, when the deal was not closed on the 16th to terminate the contract and forfeit the deposit. He had at least tacitly consented or agreed to the closing being extended to a later date, that is a date beyond the date fixed for closing. In these circumstances his remedy was to fix a new date on reasonable notice, which he did not do. This being so, we think the appeal fails and must be dismissed with costs.

[66] Similarly, in this case, Vahed was well aware that Danesh had failed to close on September 6 th, but did not choose to terminate the APS at that time as was her right. Instead, she chose to give Bury instructions to extend the closing date to September 25 th and subsequently McKee agreed to those terms as confirmed by the Extension Letter. Further, it clear by Vakili’s actions, in delivering a Statement of Adjustments and a response to a requisition letter a few days before, and in anticipation of, the September 25 th closing, that Vahed considered that the closing date had been changed to September 25. One day before closing, Vahed changed her mind and refused to proceed with the sale. In these circumstances, it is would be unconscionable to fail to recognize Vahed’s part performance and to allow the Statute of Frauds to be used to set aside the extension of closing date where it is clear that by her actions, Vahed chose to extend the closing date following Danesh’s failure to close on September 6 rather than to treat the APS as terminated.

[67] Accordingly, I find that Vahed breached the APS by failing to complete the sale of her Condominium on September 25, 2018.

ISSUE #2: SHOULD DANESH’S CLAIM FOR THE RETURN OF THE DEPOSIT BE GRANTED?

[68] Danesh seeks the return of his second deposit of $20,000 that was paid directly to Vahed in July, 2018.

[69] The first deposit of $20,000 paid by Danesh was returned to him by ReMax after Vahed failed to close the sale on September 25.

[70] In H.W. Liebig Co. v Leading Investments Ltd., [1986] 1 SCR 70, the Supreme Court of Canada stated, at 86-87:

The deposit stands as security for the purchaser’s performance of the contract. The prospect of its forfeiture provides an incentive for the purchaser to complete the purchase. Should the purchaser not complete, the forfeiture of the deposit compensates the vendor for lost opportunity in having taken the property off the market in the interim, as well as the loss in bargaining power resulting from the vendor having revealed to the market the price at which the vendor had been wiling to sell.

[71] Vahed submits that the deposits were not refundable. As the above statement indicates, a deposit is forfeited where the purchaser fails to complete the purchase. Given that Vahed chose not to terminate the APS when Danesh failed to close the purchases on the earlier closing dates, there is no basis on which she is entitled to retain the deposits. Further, there is no basis for Vahed to retain the deposits when she failed to close the sale on September 25. Accordingly, Vahed is ordered to return the deposit of $20,000.00 to Danesh.

ISSUE #3: SHOULD DANESH’S CLAIM FOR DAMAGES FOR OUT OF POCKET EXPENSES AND THE INCREASED VALUE OF THE CONDOMINIUM BE GRANTED?

[72] The assessment of damages for breach of contract puts the injured party as nearly as possible in the position that it would have been in had the contract been performed. It is presumed that damages should be assessed as of the date that the contract was to be performed unless there are special circumstances that, as a matter of fairness to the injured party, dictate otherwise: Rougemount Capital Inc. v. Computer Associates International Inc., 2016 ONCA 84, paras. 44-45.

[73] These same principles also apply where a vendor fails to close an agreement for the sale of land: 642947 Ontario Ltd. v. Fleischer, [2001] O.J. No. 4771, para. 41.

[74] If a purchaser can establish that it had some fair, real and substantial justification for a claim for specific performance, then the court may assess damages, as a substitute for specific performance, as of the date of trial: Semelhago v. Paramadevan.

[75] The sale price of the Condominium under the APS was $410,000.00. Danesh relies on an appraisal report which states that the Condominium had a value of $445,000 as of June 17, 2019 which was neither the date of the breach of the APS nor the date of the hearing of the motion for summary judgment. Although the difference between the two figures is $35,000.00, Danesh claims $25,000 on account of the increased value of the Condominium. Vahed states that the value of the Condominium has decreased however has provided no expert appraisal evidence to support her assertion.

[76] Danesh states that he was unable to purchase a similar property. He states that he kept the $20,000 deposit that was returned by ReMax untouched until the conclusion of this litigation. Given the costs of litigation and the fact that he was unable to use the $40,000 that he had saved, he was unable to come up with a down payment, and financing, to purchase another condominium. He states that Vahed’s actions have ruined his finances and prevented him from buying a condominium. Danesh’s evidence is uncontroverted.

[77] In my view, Danesh has not established that he had a “fair, real and substantial justification” for a claim for specific performance. There is no evidence that addresses the uniqueness of the Condominium. Accordingly, damages should not be assessed as at the date of trial. Further, there is no evidence of the value of the Condominium as of the date of the hearing. Finally, there is no evidence regarding the value of the Condominium as of the date of breach of the APS and therefore I am unable to assess damages for the loss of opportunity as of the date of breach.

[78] I find that the out of pockets expenses incurred by Danesh in relation to this transaction are reasonable and recoverable from Vahed, specifically: (1) $2,500.00 paid to the private lender to obtain the loan to close the transaction; (2) $3,630.00 paid to McKee for legal costs; (3) $375 appraisal fee.

ISSUE #4: SHOULD VAHED’S COUNTERCLAIM AGAINST BURY BE DISMISSED?

[79] Vahed’s counterclaim against Bury reads as follows:

Vahed claims … against Bury, Forty Thousand Dollars ($40,000.00) for punitive damages:

11. Bury acted as Vahed’s Real Estate Lawyer.
12. Bury ignored Vahed’s written instruction to obtain written undertaking from Danesh or his representative Michael McKee
13. Bury opted to self-terminate himself when his service was needed the most, therefore, jeopardising interest of Vahed in a critical period of transaction.
14. Bury did not disclose his business arrangement Danesh’s lawyer (Michael McKee) in sharing the staff member responsible to administration of the transaction with Danesh’s lawyer.
15. Bury’s negligence and breach of trust permits an award of punitive damages.

[80] Vahed’s counterclaim against Bury only seeks punitive damages. There are particulars of a claim for negligence or breach of trust nor have the constituent elements of those causes of action been pleaded or proven.

[81] In any event, as I found earlier, I am satisfied that Bury acted in accordance with Vahed’s instructions in relation to conveying her instructions regarding the terms on which the closing date was extended to September 25. Further, the relationship between Bury and Vahed broke down largely because of Vahed’s behaviour. It was appropriate for Bury to withdraw his services in the circumstances. Whether Bury and McKee shared a staff member as suggested by Vahed has no relevance in these circumstances as Bury acted in accordance with her instructions. Further, there can not be a finding of negligence without proof of resulting damages which Vahed has failed to establish.

[82] Finally, a claim for punitive damages does not constitute a cause of action and may only be awarded as a consequence of finding that a cause of action has been established: Paderweski v. Skorski, 2017 ONSC 6494, para. 154. Further, there was nothing about Bury’s actions that were malicious, oppressive or reprehensible: Agribrands Purina Canada Inc. v. Kasamekas (2011), 2011 ONCA 460, 106 O.R. (3d) 427 (C.A.), para. 76. For these reasons, Vahed’s claim for punitive damages is dismissed.

ISSUE #5: SHOULD VAHED’S COUNTERCLAIM AGAINST REMAX BE DISMISSED?

[83] Vahed’s counterclaim against ReMax reads as follows:

Vahed claims … against ReMax, One Hundred Thousand Dollars ($100,000.00) for punitive damages:

4. Breach of Trust and Fiduciary duties:
5. ReMax acted as Brokerage representing Vahed
6. ReMax had a duty to protect Vahed’s interest while being fully aware that the status of Twenty Thousand Dollars ($20,000), held in trust, was the subject of a litigation
7. ReMax, deliberately and in bad faith, released the amount held in trust, in return to exclusion of company name from the claim made by Danesh
8. ReMax released the deposit held in trust without Vahed’s written consent
9. ReMax’s action will result in thousands of dollars of unnecessary and additional expenses to Vahed, enforcing collection of the money owed from Danesh
10. ReMax’s callous, bad faith and breach of trust permits an award of punitive damages.

[84] ReMax from its own funds, reinstated the deposit of $20,000 that it released to Danesh.

[85] No loss was suffered by Vahed as a result of ReMax’s release of the deposit.

[86] Once again, Vahed has failed to establish a claim of breach of trust and breach of fiduciary duty. For the same reasons as described above, Vahed’s claim for punitive damages is dismissed.

COSTS

[87] The fixing of costs is governed by section 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43 and the Rules of Civil Procedure. Rule 57.01 enumerates various matters to be considered in fixing costs. As well, Rule 1.04(1.1) is applicable. There were no offers to settle this motion as thus the provisions of the Rules that address offers are inapplicable. In fixing costs, the objective is to ascertain an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceeding.

[3] The parties have filed Outlines of Costs:

• Danesh seeks costs of $16,543.22 on a partial indemnity basis; • REMAX seeks costs of $7,469.98 on a partial indemnity basis; • Bury seeks costs of $25,142.50 on a partial indemnity basis; • Vahed seeks costs of $24,100;

[88] Danesh, Bury and ReMax’s motions for summary judgment were successful and they are entitled to an award of costs. The hourly rates claimed and time spent are reasonable. The amount of costs claimed by the parties was within Vahed’s reasonable contemplation considering the amount of costs that she has claimed. In short, the amounts claimed are reasonable. The defendants acted reasonably throughout this proceeding. On the other hand, Vahed took positions that served to delay and make the cost of litigating this matter more expensive than this relatively small claim needed to be. One example of such conduct is referenced in my Endorsement dated November 4, 2019. I find that it is fair and reasonable for Vahed to pay costs of $15,000.00 to Danesh, $5,000.00 to ReMax and $20,000 to Bury, inclusive of taxes and disbursements.

CONCLUSIONS

[89] There are no triable issues. The motions for summary judgment are granted.

[90] I order that: (1) Vahed shall pay damages of $26,505.00 to Danesh; (2) Vahed’s claim against Danesh, Bury and ReMax is dismissed; (3) ReMax shall release the replacement deposit funds of $20,000.00 back to ReMax; (4) Within 30 days, Vahed shall pay costs of $15,000.00 to Danesh; (5) Within 30 days, Vahed shall pay costs of $5,000.00 to ReMax; (6) Within 30 days, Vahed shall pay costs of $20,000.00 to Bury. (7) This Order shall take immediate effect without it being issued and entered.

Mr. Justice M. D. Faieta

Released: June 5, 2020