Court File and Parties

COURT FILE NO.: CV-19-612282 DATE: 20220110 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Jinzhong (William) Miao AND: Dheeraj Bhatia and Madamser Law

BEFORE: W.D. Black J.

COUNSEL: Mark Arnold, for the Plaintiff Adam Pantel, for the Defendants

HEARD: December 6 – 14, 2021

Endorsement

Overview

[1] The plaintiff, Jinzhong Miao, who uses the name William (“Miao”), alleges negligence and breach of contract on the part of the defendants, Dheeraj Bhatia (“Bhatia”) and Madamser Law, the firm at which Bhatia is the sole proprietor (given this sole proprietorship, references in this endorsement to Bhatia shall include Madamser Law).

[2] The conduct that is the subject of the claim relates to a real estate deal in which Miao entered into an Agreement of Purchase and Sale (the “APS”) to purchase a residential property municipally known as 32 Woodhaven Crescent in Richmond Hill, Ontario (“32 Woodhaven”).

[3] Bhatia did not act for Miao in the negotiation and execution of the APS. Rather, in circumstances set out in detail below, Miao engaged Bhatia a few weeks before the scheduled closing of the 32 Woodhaven purchase seeking assistance in extricating himself from the deal (or perhaps re‑negotiating it).

[4] The claim alleges that Bhatia gave Miao poor advice in that context, inappropriately assuring him that he could get out of the deal with the consequence, it is alleged, that Miao ended up considerably worse off than he would have been if Bhatia had provided appropriate advice, namely, that the APS was unassailable, such that Miao’s only realistic options were to close the deal (if that was possible in his financial circumstances), or forfeit the deposit (and perhaps face exposure for additional claims). Ultimately, when - allegedly on the basis of advice and reassurance from Bhatia - Miao failed to close the 32 Woodhaven purchase, he was sued by the Vendors and eventually paid an agreed settlement amount.

[5] In a nutshell, then, the claim is that but for Bhatia’s negligent advice that Miao could get out of the 32 Woodhaven deal, Miao would have closed that purchase, would have avoided the settlement he eventually had to pay as a result of breaching that agreement, and would not have had to pay various accounts for Bhatia’s services.

The Plaintiff

[6] At the time of trial, Miao was 38 years old. He was born in China but lived in France for a number of years before coming to Canada (with permanent resident status) in June 2016. He moved to Canada together with his then common-law spouse, Dan Huang, who while in Canada went by the name Cynthia (“Cynthia”). Cynthia was pregnant when the couple arrived in Canada and gave birth to a daughter within months of the move.

[7] Miao is well educated, having completed an MBA and a Master’s degree (or degrees) in economics and psychology while in France. He testified at trial through a Mandarin language interpreter, but it is reasonably clear that he is able to function in English. While Miao was perfectly entitled to choose to testify in his first language, it is important to understand that during the course of the events in issue in this lawsuit, he conducted the various relevant interactions in English.

Miao’s Loss of Interest in 32 Woodhaven

[8] In about October 2016, at around the time of the birth of their daughter, Miao and Cynthia purchased a condominium at 150 Leithcroft Crescent in Markham (“150 Leithcroft”). It appears that the purchase of 150 Leithcroft was in Cynthia’s name, but Miao’s evidence (and Cynthia’s), was that the couple’s funds were co-mingled such that they both contributed to purchases.

[9] In early 2017, now with Miao as the named purchaser, the couple entered into a deal to purchase 32 Woodhaven. The vendors were Ahmed Hafez and Mona Elkhadem (the “Vendors”) and the agreed purchase price was $1,382,800. The deal was originally scheduled to close at the end of June 2017. The closing was moved at the Vendors’ request to August 3, 2017 (the “Closing Date”).

[10] Between the date of the APS and the Closing Date, there were a couple of developments that are significant to the matters in issue.

[11] First, Miao and Cynthia bought another house, located at 996 Portminster Court in Newmarket (“996 Portminster”), for a purchase price of $1,750,000. Their purchase of 996 Portminster closed on June 16, 2017.

[12] Second, as a result of the introduction of the “Non-Resident Speculation Tax” on April 21, 2017, and the insolvency of a prominent mortgage lender (Home Trust) around that time, there was a dip in the housing market in and around metropolitan Toronto which had the effect of lowering the values of both 32 Woodhaven and 996 Portminster.

[13] It is apparent that at some point after having purchased 996 Portminster, Miao and Cynthia lost interest in 32 Woodhaven, or at least lost interest in it at the price to which Miao had agreed in the APS. There was considerable conflicting evidence led before me about Miao’s true intention with respect to 32 Woodhaven.

[14] Bhatia’s position is that having spent the considerable sum that Miao and Cynthia did on 996 Portminster, and having regard to the drop in value of both 996 Portminster and 32 Woodhaven, the couple simply did not have, nor have access to, sufficient funds to pay the 32 Woodhaven purchase price. Bhatia points to various instances in which Miao represented to various people that he could no longer afford 32 Woodhaven. Miao does not deny having made those representations but purports to explain them in a fashion discussed below.

[15] That is, Miao maintains that he always had the financial ability to purchase 32 Woodhaven, that he and Cynthia still had considerable cash after acquiring 996 Portminster, that they were able to obtain mortgage financing as needed, that they had access to the proceeds of the sale of 150 Leithcroft (which closed on August 8, 2017, shortly after the scheduled Closing Date for 32 Woodhaven), and that they could each obtain additional funds, if necessary, from their families in China.

[16] Whatever his financial ability and his true intention, it is clear that at some point in mid‑2017, Miao began to express misgivings about the 32 Woodhaven deal.

[17] Although his evidence was that 32 Woodhaven was in an excellent location (close to a French school), and that initially he and Cynthia were very happy about the purchase, Miao says that “friends” expressed concerns to him about the basement apartment at 32 Woodhaven and that this raised doubts in his mind about whether or not he and Cynthia could safely (and legally) have tenants at that location. He began to worry that considerable expenditures would be required to correct the deficiencies of the basement apartment and feared that he could be exposed to large liabilities if it was indeed found to be illegal.

[18] These mounting concerns, together with identifying and purchasing 996 Portminster, led Miao to wonder if he could extricate himself from the 32 Woodhaven purchase or, at the very least, negotiate a considerable discount.

Miao’s Introduction to Bhatia

[19] In or about June 2017, Miao was introduced to a woman named Yolanda Cai (“Ms. Cai”), a real estate agent. Miao told Ms. Cai about the transactions and properties with which he and Cynthia were involved. He also mentioned that around that time both he and Cynthia were potentially looking for jobs.

[20] Although Miao was working at that time as a bank teller, he said that he was interested in exploring other opportunities. It does not appear that Cynthia was working at that point (just a few months after the birth of their daughter). Ms. Cai allegedly told Miao that she knew Bhatia, was aware that he was looking for an assistant to work in his office, and offered to make an introduction.

[21] Miao accepted this offer and a meeting between Miao and Cynthia, on the one hand, and Bhatia, on the other, was arranged. Miao believed that the first meeting took place on June 23, 2017. There is some question about the precise timing, but it is clear that the meeting took place within a few days after the closing of the couple’s purchase of 996 Portminster on June 16, 2017.

[22] Ms. Cai accompanied Miao and Cynthia to the first meeting with Bhatia, the notional purpose of which was to discuss the prospects of a job or jobs for Miao and Cynthia in Bhatia’s office.

Miao’s Version of Relevant Events and Interactions with Bhatia

[23] Miao’s recollection was that after reviewing his CV, Bhatia told him that he was “overqualified” for the position Bhatia had in mind but that he might consider hiring Cynthia.

[24] While these discussions were taking place, Miao recalls being very impressed with Bhatia’s office and with Bhatia himself. He testified that he noted how luxurious and well‑appointed the office was and that Bhatia was well-dressed and wore an expensive watch. At that meeting or a subsequent one, Miao also noticed that Bhatia drove an expensive car. It is clear that Miao saw these trappings as evidence that Bhatia was a successful lawyer. He said that Bhatia described himself as a “big lawyer” and that Miao’s observations of the luxurious setting and Bhatia’s outward appearance led Miao to accept that this was true.

[25] Given how impressed he was with Bhatia and his ostensible success, Miao decided to use the occasion to consult Bhatia - Miao hoped on an informal and cost-free basis - about the couple’s real estate activities and, in particular, some concerns that had arisen about 996 Portminster and the problem of the pending closing for 32 Woodhaven, for which the couple’s enthusiasm had by then waned considerably.

[26] Regarding 996 Portminster, Miao explained that the couple had only seen it in the wintertime when they agreed to purchase it. They had not negotiated or arranged a home inspection. When they saw 996 Portminster in more clement conditions, they apparently noticed some damage that had not been apparent to them at the time of entering into the purchase and sale agreement.

[27] Miao says that Bhatia told them that since the purchase had closed by that time, it would be difficult to assert any claims about the newly discovered damage to the house but he recommended that the couple arrange a full house inspection to look for latent defects that ought to have been disclosed. While there was not a great deal of evidence before me about 996 Portminster, there was testimony confirming that Miao and Cynthia subsequently retained Bhatia and commenced a claim relative to alleged problems at the property, which proceeded more or less in parallel to the events at issue concerning 32 Woodhaven.

[28] With respect to 32 Woodhaven, after Miao and Cynthia expressed their concerns about the house and in particular the basement apartment, Bhatia asked to see the APS. Cynthia emailed it to him then and there. Miao says that Bhatia reviewed the document on his computer and, at that time, expressed concern about the basement, telling Miao and Cynthia that it was illegal and that if anything happened in it - for example, a fire - they would be liable, potentially for significant amounts. Miao and Cynthia say that Bhatia then told them that they “should not close” the 32 Woodhaven transaction.

[29] They also recall Bhatia saying that based on the APS, this would be an easy case and that if they paid him $25,000, he would get them out of the deal. Miao says that Bhatia also mentioned the survey and an issue with respect to notice to a tenant, but that he gave them the impression that the illegal basement apartment was the key issue that would get them out of the purchase.

[30] Miao testified that he and Cynthia came out of the first meeting with Bhatia with some skepticism and a feeling that “this was too good to be true”. He said that Bhatia’s confident assurance that they could get out of the deal was at odds with what they had been told by others, and that accordingly, they did not yet trust Bhatia fully and wanted to go home to consider potential next steps.

[31] Having done so, Miao and Cynthia decided to book another meeting with Bhatia with a view to discussing and confirming Bhatia’s advice about getting out of the 32 Woodhaven deal.

[32] To that end, they returned to see Bhatia, Miao thinks on or about June 25 or 26 of 2017. Again, he and Cynthia attended together with Ms. Cai. Miao testified that the purpose of this second meeting was to discuss with Bhatia in detail the options for 32 Woodhaven.

Alleged Guarantee

[33] Miao says that at this second meeting after reviewing the APS in their presence and in answer to their question about how confident he was that he could get them out of the 32 Woodhaven deal, Bhatia said that he was “100 to 120% confident that he could get them out of the deal”. It is important in comparing Miao’s version of these events to Cynthia’s version, discussed below, that Bhatia’s alleged stated level of confidence (i.e., 100-120%) was in relation to the chances of getting out of the purchase.

[34] Coupled with Bhatia’s alleged statement of utmost confidence, Miao again remarked in his evidence about the luxury of Bhatia’s office, about Bhatia’s luxury automobile parked outside the building, about Bhatia’s nice clothes, and the generally confident way in which Bhatia conducted himself. Once again, Miao stated that these trappings led him to believe that Bhatia was a successful lawyer who, in Miao’s words, “would not cheat them”. Indeed, Miao’s testimony was that although he and Cynthia had reservations after their first meeting with Bhatia that what he was telling them was “too good to be true”, it was the various indicia of success in Bhatia’s office, in addition to his confidence, personal attire, and possessions, that led then to overcome their reservations and decide to place their trust in him.

[35] Miao’s evidence was that other than Bhatia’s “100-120%” statement and being struck again by the outward signs of Bhatia’s success, he could not recall many details from the second meeting.

[36] When asked about Schedules B and C to the APS - which related to the basement apartment and effectively confirmed that it did not meet various Building Code, O. Reg. 332/12, Fire Code, O. Reg. 213/07, and registration requirements, and that the property including the basement apartment was being sold on an “as is” basis - Miao then recalled that during the first or second meeting (he was not sure which) Bhatia also gave them the impression that the illegality of the basement apartment was the “main issue”. Miao says that this caused him and Cynthia to take this issue “very seriously” and to be fearful of the consequences if they closed (in terms of the potential inability to rent the basement apartment).

[37] Miao also attributed to Bhatia an odd statement which Miao initially testified Bhatia made sometime during the first or second meetings, and then later said may have been made subsequently, to the effect that “Caucasian lawyers do not know how to fight in court” like lawyers of Indian descent. While he attributed the statement to Bhatia (which Bhatia denies, as set out below), it was also clear that Miao readily accepted this characterization. At another point in his evidence, he specifically said that he and Cynthia would not go to a lawyer of Chinese origin for help with their claim since, according to Miao, such lawyers were good for transactional work but not for litigation.

[38] As these examples and Miao’s evident preoccupation with Bhatia’s outward signs of success attest, it is clear that Miao was (and is) oddly drawn to and persuaded by fallacious stereotypical assumptions.

Miao’s Admitted Misrepresentations

[39] Moreover, by his own repeated admission, it is also clear that Miao believes that lying during the course of negotiations is a standard and acceptable part of doing business. That is, the record is replete with examples, some of which are discussed in more detail below, of Miao making statements to various parties about his financial circumstances - both during and outside of his relationship with Bhatia - that he now says were untrue. Most particularly, it is clear that Miao told various people at various times that he had no money to close the 32 Woodhaven deal (sometimes with more specific embellishments accompanying that representation). His evidence at trial was that those representations were untrue and that at all times he and Cynthia had ample resources to close the 32 Woodhaven deal if they wanted to. He testified that his representations were untrue but that rather than “lying”, he was “posturing” with a view to negotiating either an exit from the deal or better terms. He expressed the view that such misrepresentations are part and parcel of ordinary negotiation (including in his current work as a car salesman) and it was clear that he saw nothing wrong with telling untruths and felt no compunction about doing so either at the time or even now.

[40] I must say that while I am not naïve enough to believe that parties do not overstate or exaggerate propositions during the course of negotiations from time-to-time, it is clear that an overriding requirement of good faith precludes a strategy of ongoing out-and-out lies: C.M. Callow Inc. v. Zollinger, 2020 SCC 45, 452 D.L.R. (4th) 44, at para. 77. Moreover, even if I were prepared to countenance Miao’s strategy, which I am not, it is important to remember that his purported “posturing” was in the setting of a concluded agreement from which he was trying to extricate himself, or to exact more favourable terms than the terms he had negotiated. I simply do not accept that it is tolerable to fabricate and prevaricate in order to get one out of their contractual commitments.

[41] Miao’s unapologetic attitude about the purported propriety of such deception gives me serious reservations about his credibility.

[42] Miao testified that he and Cynthia left the second meeting with Bhatia with the understanding that he would fight for them and guaranteed that he could get them out of the 32 Woodhaven deal for $25,000 or $30,000, being the amount of a retainer they agreed to pay Bhatia at that time.

[43] When asked what he and Cynthia would have done if not for Bhatia’s 100-120% guarantee, Miao testified that they would have proceeded to close the 32 Woodhaven deal. This claim is an important aspect of the plaintiff’s case. For the reasons set out below, however, the evidence does not suggest that any such guarantee was made. Moreover, as I will also describe below, the evidence is at best inconclusive as to whether Miao would have been able to close on 32 Woodhaven.

Miao’s Evidence about his Finances

[44] In terms of Miao’s representations about their finances, Miao was asked about a series of texts that he exchanged with his real estate agent Xin Tong (“Ms. Tong”), just prior to the first meeting that he and Cynthia had with Bhatia.

[45] Miao’s evidence was that while earlier in 2017 he had asked Ms. Tong to show them a number of properties, and had told her they had ample funds to close the 32 Woodhaven deal, later on, “once they learned of the issue with respect to the basement”, he wanted to “negotiate” and so began to tell Ms. Tong that they did not have the money to close the deal.

[46] In a series of texts commencing on or around June 20, 2017, Miao specifically said to Ms. Tong:

• When asked about sourcing the necessary funds to close: “Where do I get so much money from?” or, “Can you lend me some?”
• When asked: “What did the mortgage people say[?]”, responded: “Refused”
• When advised that the seller’s agent was asking “If 32 Woodhaven will be closed normally”, told Ms. Tong: “Send him a reply. According to the current situation it won’t be closed normally”
• When asked to clarify this response (Ms. Tong said: “Can’t close, or will be delayed? The other party is asking me to reply by email”), said: “According to the current situation, can’t close...no money to close…too much money, I think I won’t be able to raise that much”
• When asked by Ms. Tong: “How do you want me to respond?”, instructed her: “Reply him first…just say ‘Unable to close’…‘say nothing else’” and “Sigh. Get into big trouble, no choice, still have to face it”
• In response to Ms. Tong telling him that she had “told the other agent that we wish the price can be reduced”, he said: “You tell him if the price can be reduced, then I may be able to close the house…let me take a break. Then I’ll buy again…currently, have to get through the difficult situation first…it makes me regret even more. Back and forth, I lost hundreds of thousands. Don’t know if I can get through this obstacle…I indeed exhausted all my means…I’ve only been here for a few months and got into this trouble…have no choice. Otherwise I’ll go bankrupt soon…can’t pay for the mortgage…it’s over for me. It’s like the Warrior cutting off an arm”
• Later in the exchange, after again saying that he was unable to borrow the amount required, Miao claimed: “I wrote Dan Huang a promissory note. Most of the money transferred to me was from Dan Huang’s account…if they insist on my selling the house, Dan Huang is also a creditor and can ask me to repay the money”.

[47] The last exchange above was in relation to the possibility that, in order to collect damages from Miao if he failed to close 32 Woodhaven, the Vendors might pursue Miao’s equity in 996 Portminster. Apart from claiming that he had no equity given the fall in the market value of that house, Miao was claiming that Cynthia had loaned him the money for that purchase and that he had given her a promissory note to secure his debt. There is no evidence that this happened and no promissory note was produced in evidence (and indeed Cynthia testified that she had no knowledge of this and has no recollection of requesting or receiving a promissory note). While in the witness box, Miao claimed not to remember whether he had given Cynthia a promissory note or whether or not he would have claimed that to be the case if it was not true. With respect to his other texts above, the upshot of Miao’s testimony was that the claims that he did not have enough money or access to sufficient funds were not accurate and that he was attempting, by misrepresenting the situation to his agent and arming her with (mis)information that she would in turn take to the seller’s agent, to impose pressure to renegotiate the deal. Again, it was clear from Miao’s evidence that he saw nothing wrong with uttering this series of what he now says were untruths, all with a view to forcing the seller to renegotiate.

[48] I note here that Cynthia’s evidence largely mirrored Miao’s. This is perhaps not surprising given that they were a couple (she has since left him and moved back to China with their daughter), and, as such, would have been discussing these events together at the time. Nevertheless, there are a couple of important qualifications to the identity of their respective testimony. First, as noted above, Cynthia’s evidence differed from Miao’s in the detail of what is alleged to be the key evidence in the plaintiff’s case regarding the alleged “guarantee” from Bhatia. That is, Cynthia testified that Bhatia’s “guarantee” was that it was “100-120%” certain that they would “win the case”. At the time of the alleged guarantee there was no “case”. While it is possible that Cynthia was conflating a guarantee about “getting out of the deal” with a guarantee about “winning the case” that difference, in relation to what Miao maintains is the key issue in the case, is significant. Second, it is clear that Miao was the person leading all negotiations and discussions and, in fact, there are various instances, such as Miao’s claim in his email with Ms. Tong that he had given Cynthia a promissory note, in which Cynthia has no memory and likely had no knowledge at the relevant time of Miao’s ongoing activities and statements. Further, as discussed in more detail below, by mid-2018, Cynthia had significant concerns about the state of Miao’s mental health and well-being.

[49] Following the initial meetings with Bhatia, it appears that Miao and Cynthia had a number of additional meetings with Bhatia. Miao was not clear on the precise timing for these meetings, but it is clear that as a result of their ongoing discussions with Bhatia, Miao and Cynthia retained him and instructed him to send a letter to the Vendors’ lawyer setting out the alleged breaches by the Vendors of the APS, in turn justifying Miao’s refusal to close the purchase.

Bhatia’s Initial Letter to Vendors’ Transaction Lawyer

[50] Bhatia sent his initial letter to the Vendors’ lawyer on July 12, 2017.

[51] There is a disagreement in the evidence about Bhatia’s advice to Miao and Cynthia about which argument or arguments provided the most promising potential bases to avoid the deal.

[52] Miao and Cynthia testified that it was made clear to them that the strongest argument was about the illegal basement - that is, that the basement apartment was not in compliance with the Fire Code and other requirements.

[53] On the other hand, Bhatia’s evidence, which I will discuss more fully below, was that the only allegation with any potential prospect to get Miao out of the deal was in relation to a survey for the property. The APS required the Vendors to provide an existing survey of the property to the purchaser within three days after acceptance of the offer. It is clear that during one or more of their initial meetings, Miao told Bhatia that no such survey had been provided.

[54] Leaving aside for the moment the question about what arguments were thought to have the best chance of success, Bhatia’s July 12 letter took a “kitchen sink” approach, reciting, in 18 numbered paragraphs, every conceivable basis to void the agreement.

[55] The Vendors’ real estate lawyer, Tariq Muinuddin (“Mr. Muinuddin”), responded the day after receiving Bhatia’s initial missive. He focused on just a couple of the many points raised in Bhatia’s letter and in particular, with respect to the survey, advised that the survey had been given to Miao the day after the APS was finalized and that Miao had in fact signed a waiver of the survey condition.

[56] On that same day, Miao, having reviewed Mr. Muinuddin’s response to Bhatia’s July 12 letter, sent Bhatia an email in which he somewhat sheepishly stated that, having gone through his documents after seeing Mr. Muinuddin’s letter, the survey had in fact been provided and that he had signed a waiver just as Mr. Muinuddin’s letter attested.

Miao’s Acknowledgement of Having Received Survey

[57] Miao’s email to Bhatia with this news started with a bold-faced note that he had “bad news” and contained a bold-faced apology, “I feel so sorry about this accident. I will re‑check all the emails” and a further apology coupled with a statement about Bhatia’s stellar work to that point: “In your letter, I saw you made a great paragraph about the survey. Sorry again. You did a great job for my case. I appreciate your time and effort.”

Deterioration of Relationship Between Miao and Bhatia

[58] It was around this juncture in mid-July 2017, at which point in my view it was clear that the APS was in fact firm and binding and that there was thus no legitimate basis for Miao to refuse to conclude the deal, that the relationship between Miao and Bhatia began to unravel. From mid‑July 2017 going forward, the events discussed below occurred.

[59] On July 17, 2017, Bhatia sent a further letter to Mr. Muinuddin, responding to Mr. Muinuddin’s letter of July 14. In that letter, consisting of a further 15 numbered points (most of which repeated or were variations of the points in Bhatia’s July 12 letter), Bhatia continued to assert, using the same kind of “kitchen sink” approach that characterized his earlier July 12th dated letter, that there were various bases on which the Vendors had breached the APS. With respect to the survey, among other arguments, Bhatia changed the approach from alleging that no survey had been provided to Miao (as his July 12 letter had asserted), to now claiming that only a copy of the survey had been provided. According to Bhatia, this constituted a breach of the APS, which required the Vendors to provide an original survey.

[60] Mr. Muinuddin effectively ignored this further letter and next wrote to Bhatia on July 28, 2017, a few days before the scheduled Closing Date (August 3), simply saying: “Please send your requisition letter ASAP”.

[61] Bhatia responded on July 31, expressing “astonishment” that Mr. Muinuddin had ignored the “serious issues” in Bhatia’s previous letters, reiterating the position that the APS was “null and void” and threatening litigation against not only the Vendors, but also the real estate agents and brokerages involved in the deal.

[62] Consistent with this position, Miao did not close the deal on the Closing Date.

[63] On the Closing Date, Mr. Richard Belsito (“Belsito”), a litigation lawyer engaged by the Vendors, wrote to Bhatia to advise that he had been retained, to note that the deal had not closed as required, and to ask if Bhatia would accept service of a statement of claim that Belsito would be issuing immediately.

[64] A claim was in fact issued on August 17, 2017 (the “Underlying Litigation”) and that litigation proceeded until settled between the parties in January and February of 2019.

[65] During that time, as the Underlying Litigation unfolded, Miao says that he came to understand that his position was not as strong as he had been led to believe and that contrary to his expectation, Bhatia sent him a number of bills concerning both 32 Woodhaven and 996 Portminster. As noted above, while it is the former property that is in issue here, a claim involving the latter property (and in which Miao was also the plaintiff) had also been issued.

[66] As the pressure from the Underlying Litigation increased and as Bhatia’s outstanding accounts mounted, Miao began to exhibit increasingly odd and ultimately counterproductive behaviour. Sadly, he also began to experience deteriorating mental health.

[67] While there is evidence that Miao’s mental health difficulties predated the events in issue, it is clear that as the consequences of his ill-advised real estate decisions began to close in on him, Miao experienced increasingly pronounced emotional difficulties.

[68] Matters really came to a head in Summer 2018.

[69] The Vendors had by then brought a motion for summary judgment within the Underlying Litigation. While that motion was somewhat delayed, cross-examinations took place in June 2018 and Miao, not surprisingly, did not fare well in that setting. At the trial before me, Miao maintained that his poor performance on cross-examination was in large part because rather than attending at the cross-examination with him, Bhatia instead sent “an inexperienced junior lawyer”, Roshni Vora (“Ms. Vora”), to defend him at the cross-examination.

[70] In fact, Ms. Vora was not a junior lawyer in Bhatia’s office, but a lawyer with whose firm Bhatia had associated in part because Ms. Vora apparently had litigation experience such that she and Bhatia could pinch hit for one another in litigation matters as necessary. There was no specific evidence before me concerning Ms. Vora’s year of call or the extent of her litigation experience.

[71] The transcript of Miao’s cross-examination from the Underlying Litigation was before me in evidence. Without presuming to pass judgment on Ms. Vora’s performance, it is abundantly clear that Miao was a poor witness. He maintained repeatedly, as he did in the trial before me, that he had misrepresented his financial circumstances to various people at various times, that he had sufficient funds as of the Closing Date to close the deal, and that he only made misrepresentations because he did not want the 32 Woodhaven property, not because he could not afford it.

[72] For example, at pages 24-25 of the transcript of his cross-examination in the summary judgment motion in the Underlying Litigation, on June 22, 2018, Miao said repeatedly, under oath, that in claiming not to have had money to close the 32 Woodhaven deal, when in fact he did have money to do so, he was not “lying” but rather “just wanted to find an excuse to cancel the deal”.

[73] In late July 2018, Ms. Vora wrote to Miao to request information to allow her to answer certain undertakings given by Miao on his cross-examination. Within a couple of days of Ms. Vora’s email to that end, a clerk in Bhatia’s office, Selwyn Pe (“Pe”), also wrote to Miao to advise of amounts outstanding and owing to Bhatia and to request that Miao bring a cheque to replenish the original retainer.

[74] While the request to replenish the retainer was in relation to 32 Woodhaven, Miao responded with an email saying that in relation to the file for 996 Portminster, “I want to stop my case work regarding to 996 Portminster case, I am totally not satisfied with your services”.

[75] Within two days of this email from Miao, on July 30, 2018, Bhatia responded to Miao, expressing puzzlement at Miao’s direction and maintaining that in both cases (32 Woodhaven and 996 Portminster), events were ongoing, and that Bhatia had been working hard on the cases and following Miao’s instructions in each.

[76] This email precipitated a further exchange on July 31, starting with Miao’s email to Bhatia just after midnight (12:39 a.m. on July 31) in which, after opening with “I was a fans of you [sic], I respected you as the best lawyer I had seen, I putted [sic] all my money and trust in you”, Miao expressed criticism of the way he and his case(s) had been handled.

[77] At 6:42 that morning Bhatia responded, expressing concern about the implications of Miao’s email, defending the work that he and his firm had done, and saying (relative to 32 Woodhaven), “you knew and were advised before you retained me that the case is very difficult and I am trying my best”.

[78] This ongoing exchange led to a visit by Miao and Cynthia to Bhatia’s office later that day (July 31, 2018). Bhatia sent an email on that same day, after the meeting, confirming his understanding of what had occurred. The upshot was that after a detailed discussion about the two cases, Miao initially advised that he wanted Bhatia to continue working on both cases. However, after Bhatia then asked for a further retainer on the 32 Woodhaven case, Miao responded that he was “not an ATM”, and eventually told Bhatia to stop working on both cases pending further instructions. Bhatia, after noting those instructions, advised in his email that there were strict deadlines upcoming in both cases and that in the 32 Woodhaven case, given the looming summary judgment motion, it would be necessary in short order to prepare responding materials.

[79] Over the course of the next few days, in early August 2018, Bhatia (and one of his colleagues) sent Miao a series of increasingly urgent emails and left him telephone messages, reminding him of the tight time for delivering responding materials in the 32 Woodhaven case and urging him to answer. In addition, on August 1, Bhatia’s clerk, Pe, forwarded offers to settle to Miao that had been received from the real estate brokerages and agents that Miao had added to the 32 Woodhaven litigation by way of counterclaim. Pe was requesting a response to those offers and noted that Miao was also not responding to Bhatia’s emails.

[80] On August 8, 2018, Cynthia sent an email to Bhatia explaining Miao’s non-response to these various communications. That is, Cynthia advised Bhatia that Miao was in hospital, having attempted suicide a few days earlier (it appears on August 5).

[81] During this timeframe, between the beginning of August and mid-September of 2018, the following events and revelations occurred and emerged leading to a definitive parting of the ways between Miao and Bhatia:

• During the midst of his escalating fallout with Bhatia in early August, and a couple of days before his suicide attempt, Miao and Cynthia had gone to see another lawyer, Geoff Pollock, for an opinion about the 32 Woodhaven litigation. Mr. Pollock, after a second meeting with them in mid-August, advised them in strong terms to settle the 32 Woodhaven case which he described as “weak and tenuous”.
• In discussing Miao’s condition with Bhatia (in the context of determining if and when Miao would be able to make meaningful decisions about the litigation), Cynthia advised Bhatia that Miao had experienced and exhibited mental health difficulties commencing at least as early as the early part of 2017 and that in March 2017, Miao had been under the care of a psychiatrist, had been prescribed anti‑depressant medication, and had now stopped taking that medication for reasons that were not clear to her. She said that over the past several months (as of the suicide attempt in August of 2018), Miao had been acting erratically, had been struggling, had been tired and sad, and that the two of them, Miao and Cynthia, had been arguing regularly and were talking about separation.
• On August 15, following the offers to settle from the real estate broker/agent, defendants by counterclaim, the plaintiff Vendors made an offer to settle the 32 Woodhaven case for $150,000.
• Bhatia attempted repeatedly to get instructions from Miao or Cynthia concerning that offer and a possible counter-offer.
• On August 20, 2018, Miao responded to Bhatia - it appears for the first time since their meeting on July 31 - in an odd and somewhat rambling email, in which he told Bhatia that he (Miao) was in a deep depression, was “empty now”, that he had “no money to pay (Bhatia) to run the case” but that Bhatia was “born as a fighter” and “so let’s go fight on the court [sic]” and that “if we win, we can get your legal fee from the seller side”.
• In the midst of that same August 20 email, Miao said, regarding a potential settlement, that “if the seller can return half (the) deposit, I would like to accept the deal”.
• Later that same day, August 20, 2018, Miao inexplicably sent an email directly to the office of counsel for the Vendors/plaintiffs in the Underlying Litigation. In that email, Miao told opposing counsel that he had been in the hospital, that he had no money to pay his lawyer or otherwise, that he did not know if Bhatia’s firm would continue to “support him” in the case, and so, if possible, he (Miao) would deal with the case himself in court, and that he would like to settle on the basis of the plaintiffs’ paying him back half of his deposit (i.e., the same proposal he had mentioned to Bhatia in his email to him earlier that day).
• This led - when the plaintiffs’ counsel, Belsito, quite properly brought Miao’s email to the attention of Bhatia, Miao’s counsel of record - to Bhatia emailing Miao, decrying his behavior and telling him that he would have to get another lawyer or act for himself in the litigation. In his emails, Bhatia informed Miao that both of his cases (32 Woodhaven and 996 Portminster) required attention but that, presumably in part because of Miao writing to opposing counsel without Bhatia’s knowledge, the relationship between the two of them had broken down to the point that it was untenable.
• In response to these emails from Bhatia, Miao wrote a bizarre email on August 21, 2018 - which at trial he purported to explain as “sarcasm” - addressing Bhatia as “My Bro”. The email also stated: “[A]s I said one year ago to you that I would try my best to let everyone know you are the best lawyer in the world” and was signed off by Miao with “Yours Truly Best Bro”. In addition to containing these odd statements, the email complained (again) about Bhatia’s requests for additional funds.
• Not surprisingly, as various further emails from Bhatia went unanswered and as the date for the summary judgment motion (which was eventually adjourned) neared, matters between Miao and Bhatia culminated in a meeting at Bhatia’s office on September 7, 2018, attended by Miao and Cynthia, at which Miao signed a Notice of Intention to Act in Person in the Underlying Litigation. At that same meeting, both Miao and Cynthia signed an “Acknowledgment and Release” document, prepared by Bhatia, confirming various purported communications and understandings about aspects of the relationship between Miao and Bhatia, and confirming Miao’s properly informed and independent decision to represent himself in the litigation going forward.

[82] I note that the Acknowledgment and Release document is frankly self-serving for Bhatia. As such, I do not find that it has particular importance or force in the case before me and, given its origins, would not place much reliance on it in any event.

Settlement of Underlying Litigation

[83] After the parting between Miao and Bhatia, Miao eventually found his way to Mr. Arnold, who represented him in the case before me. In addition to launching this claim, Mr. Arnold, to his credit, managed to settle the Underlying Litigation for the all-inclusive amount of $135,000.

Bhatia’s Evidence about Relevant Events and Interactions with Miao

[84] Bhatia’s version of the relationship and relevant interactions with Miao (and to some extent with Cynthia) is, as alluded to in the discussion above, considerably different than Miao’s version on many points, including the most critical ones.

[85] Going back to their initial meeting, Bhatia said that Miao’s (and Cynthia’s) testimony that they met in circumstances in which Bhatia was looking to hire someone to work in his office, is simply not true. He testified, persuasively in my view, that if he was looking for an employee, he would advertise the position (whatever it might be) and would go through a proper recruitment and interview process. He testified that he knew Ms. Cai through work that he had done for his mother (relative to buying and flipping properties), and that Ms. Cai brought Miao and Cynthia to see him expressly on the basis that they had litigation matters that they were contemplating and, as such, were potential litigation clients.

[86] Bhatia testified that his initial meeting with Miao and Cynthia was on June 21 or 22, 2017, and that, on that day, the couple only asked him about 996 Portminster and a potential claim with respect to that property, on which they had just closed on June 16. He says they told him this was their first home purchase, that it had been February and there had been snow on the ground when they visited and agreed to purchase the house, that they had therefore not seen certain mold and other damage on the walls, and that they had not negotiated for an inspection before closing.

[87] Bhatia says that he discussed with them the strategy of engaging an expert home inspector to attend the house and to look for evidence of latent defects. He said that Miao had obviously done some reading and was aware of the distinction between latent and patent defects, and the potential significance of latent defects if they could be identified.

[88] Bhatia said there was no mention of 32 Woodhaven at this initial meeting.

[89] Bhatia testified that Miao and Cynthia came back the next day and that Miao had a notebook with him, in which he had a series of questions and made a series of notes about Bhatia’s experience and his additional thoughts on a strategy for 996 Portminster. He recalled that Miao told him that they (Miao and Cynthia) had consulted other lawyers but that they liked Bhatia’s idea about engaging a home inspector, and that Miao could tell that Bhatia was “a fighter” and that Miao “liked his style”. He stated that during the course of this meeting, Miao had made the remark that Miao had attributed to Bhatia (in Miao’s testimony), that “Caucasian lawyers would not fight the way Bhatia, a lawyer of Indian descent, would”. Bhatia said that he himself would never say such a thing and did not think it was apt.

[90] He also said that Miao confirmed during this second meeting that part of what was driving him to want to exact a refund from his 996 Portminster purchase was the fact, well-known to everyone involved in residential real estate in and around the GTA at the time, that the market had “crashed” since the introduction of the Non-Resident Speculation Tax in April of that year. Bhatia said that Miao expressed the view that 996 Portminster, which he and Cynthia had purchased for $1,750,000, was now worth something in the order of $1,000,000.

[91] Bhatia said that Miao and Cynthia left this second meeting saying they were going to consider Bhatia’s advice about 996 Portminster and let him know their decision. Bhatia testified that at this stage he was becoming impatient with Miao and Cynthia. He explained that his normal policy is to offer a free half-hour consultation to potential litigation clients and that Miao and Cynthia had now taken up considerably more time than this over the course of two meetings. He said he had formed the impression that they were just looking for free legal advice.

[92] Nonetheless, he agreed to meet with them again on June 26, 2017, based on Ms. Cai calling him again to say that Miao and Cynthia had another litigation matter - a “big case” - for which they wished to consult him.

Bhatia’s Notes

[93] At this stage in Bhatia’s testimony, he produced - and I ultimately agreed to mark as an exhibit (Exhibit 10) - three pages of notes from an office diary.

[94] Bhatia explained that up until 2019, he had a practice of making notes in a separate diary about litigation matters - whether they be actual claims or potential claims - discussed with litigation clients. He said he did not do so for real estate transactions, the largest aspect of his practice, since those matters tended to be repetitive and somewhat routine. He also said that he did not keep notes for all litigation discussions, but only, in effect, for discussions of substance, particularly where there might be important details to track.

[95] Bhatia explained that he made these notes with a pencil, which was a habit he picked up by watching his father, apparently a prominent lawyer in India, while Bhatia was growing up.

[96] The three pages comprising Exhibit 10 were notes that Bhatia testified that he made on June 26, June 27 and July 4 of 2017, arising from meetings with Miao and Cynthia, specifically in relation to the potential claim with respect to 32 Woodhaven.

[97] Mr. Arnold, on behalf of Miao, objected to the introduction of these notes. He alleged that they are self-serving, that there are concerns that the notes are made in pencil as opposed to ink (such that they could be altered), and that there are many blank pages in the diary, which Mr. Arnold labelled as suspicious. Implicitly, without saying so in so many words, the allegation was that the notes were “manufactured” after the fact and are not genuine.

[98] In the circumstances, I asked to see the original diary (which was for 2017).

[99] In reviewing it, I confirmed that, while there are many blank pages in the diary, there are also many pages filled by notes, and the notes invariably relate to litigation matters. The number of blank pages, Bhatia explained, relates simply to the fact that he makes the notes on the date or dates on which the interactions occur, and in his practice there are many days in which no significant litigation-related meetings take place. I was also able to confirm that not all, but the vast majority of notes in the diary, were recorded in pencil. Having reviewed the original diary, it was my view that it was highly unlikely to have been fabricated since it contained many, many pages of notes relating to other matters.

[100] Mr. Arnold also expressed concerns about the timing of disclosure of the diary. It was not listed among Bhatia’s Schedule A documents or otherwise in his affidavit of documents. Bhatia testified that his practice was to store such yearly diaries in a particular part of his office, and that he had discontinued the practice of keeping these diaries after he experienced an accident in which he had broken both of his wrists (a couple of years ago). He said that when dealing with the productions in the case, he had simply lost sight of the fact that these notes existed. However, when asked about any notes on discovery, it occurred to him that they might be available and gave an undertaking to look for them and to produce them if found.

[101] I was advised that the notes were in fact produced in answer to that undertaking in May 2020.

[102] In my view, which I expressed to counsel, if there were concerns about the timing or alteration of the entries in the diary - a very serious allegation - Miao had plenty of time after receiving the notes to seek to have an expert review the notes to “date” them and to detect signs of erasure and rewriting.

[103] In the absence of such an opinion and in the absence of any attributes of the notes or the diary that seemed suspicious or concerning, it was my view that the notes were genuine and would serve the purpose of refreshing Bhatia’s memory of the interactions they record.

[104] I offered Mr. Arnold the opportunity to mark the full diary in evidence so long as the names and any identifying details of other litigation clients could be concealed, but he declined, and so only copies of the three relevant pages were marked.

[105] Those notes confirm important aspects of those three meetings at which 32 Woodhaven was initially discussed.

[106] The June 26 note confirms, as Bhatia testified, that Miao and Cynthia were in his office that day and were asking for advice about an APS they had entered into, and which they now wanted to get out of. Bhatia testified that Miao was somewhat sheepish in telling him about 32 Woodhaven inasmuch as he had previously told Bhatia that 996 Portminster was their first real estate purchase whereas, in fact, they had entered into the APS for 32 Woodhaven in February of 2017, before the acquisition of 996 Portminster. (I note parenthetically that even leaving 32 Woodhaven aside, the claim to have been first time buyers would be untrue given their purchase of 150 Leithcroft in the Fall of 2016). Miao told Bhatia that there would be “no more surprises”.

[107] Bhatia’s notes record that he told Miao and Cynthia that if they had a firm and binding APS the chances of avoiding the deal would be “slim” and that there was “no guarantee”.

[108] I take a slight detour here to note that on July 17, 2017, Bhatia sent an email to Miao relative to 996 Portminster, in which he said, “As we discussed, there can never be any guarantees whatsoever in any case and I never give same.” Miao argues that since this email was in relation to 996 Portminster, it has no bearing on 32 Woodhaven. I disagree. In my view it is difficult to believe that the author of this email, relative to another potential claim which was by all accounts stronger than the 32 Woodhaven claim, would say “there can never be any guarantees whatsoever in any case and I never give same” in one case, and during the same timeframe (which I note was before the 32 Woodhaven Closing Date and the commencement of the Underlying Litigation), would give a “100-120%” guarantee of success of “getting out of” the 32 Woodhaven deal or “winning the case”. Bhatia’s contemporaneous email is consistent with his note of June 26, 2017, consistent with his testimony, and frankly, consistent with common sense. Bhatia was clearly a busy practitioner and to think that he would utter a “100-120%” guarantee on what was clearly a difficult case is far-fetched. Bhatia’s counsel also argued, I think fairly, that if in late June of 2017 Bhatia had given a “100-120%” guarantee, and on July 17, 2017 had sent an email claiming there can never be any guarantees and he never gives them, one might have expected Miao to raise alarm at the contradiction. However, there is no evidence to suggest Miao did any such thing. I accept that in fact Bhatia told Miao and Cynthia that it would not be easy to get out of the 32 Woodhaven deal.

[109] Consistent with this evident difficulty, Bhatia’s June 26, 2017 note also records him telling Miao and Cynthia that they should attempt to resolve with the Vendors by offering the deposit and potentially additional money and Miao responding that he had already tried to do so.

[110] The notes reflect the conclusion of the June 26 meeting, being that Miao would return the next day with all documents from the 32 Woodhaven deal and that he would bring payment for a retainer.

[111] Miao and Cynthia did in fact return the next day and Bhatia’s notes from that meeting, which Bhatia testified was now with the APS in hand, reflect them telling him, regarding 32 Woodhaven, that the property was “not good”, that it had an “illegal basement”, and that a survey had “not been provided”. While Miao said in his evidence that Bhatia had told them that the basement was illegal, Bhatia says, and his notes appear to confirm, that this was a preconception with which Miao came to him (and indeed Miao’s testimony during his cross‑examination in the summary judgment motion in the Underlying Litigation was that he had been told that about the basement’s potential illegality by “friends” well before he ever came to Bhatia). The next entry says: “[C]annot close anyways” and the following notes elaborate that they had “no mortgage” because they were “not qualified”. The notes also record that they alleged that their agent did not advise them properly.

[112] Bhatia’s notes say, and he testified, that he would need a retainer, that the case “will be very expensive”, and that if they were to lose, Miao and Cynthia would have to “pay costs, damages, and legal fees to the other side”. Bhatia records Miao’s response, which was that they had “no choice”. Bhatia’s last two notes on June 27, 2017, say “sign retainer” and “think again before”. Bhatia explained that the latter note reflects his admonishment to them that given the difficulty and cost of the case, they should think again before commencing a formal action.

[113] Bhatia says that he pointed out to Miao and Cynthia on June 27 the “as is” language in the Schedules of the APS with respect to the basement apartment and that he told them no legitimate complaint was available.

[114] He held out more hope, he testified, with respect to the survey condition, given Miao’s advice to him that a survey had not been provided. Bhatia said he told Miao and Cynthia that there was a decision from the Court of Appeal for Ontario that gave them an arguable case to void the deal if the Vendors had failed to provide a survey as required.

[115] Bhatia also noted and remarked during the meeting that the requisition date (the date by which a title search was to have been completed under the APS), had already passed about 10 days prior. Miao confirmed that no search had been done and, in response to Bhatia’s suggestion that they go ahead and do one, Miao said he did not wish to given any impression to the Vendors that he was bluffing about his inability to close nor give them any hope that he would do so.

[116] Finally, on June 27, 2017, consistent with Bhatia’s note for that day, Miao executed Bhatia’s standard form retainer which, among other things, confirmed that Bhatia’s firm could charge its time and amounts beyond the initial retainer of $30,000.

[117] The third and final note within Exhibit 10 was Bhatia’s note from their next meeting on July 4, 2017.

[118] Bhatia’s note of that day confirms again Miao’s advice to him that the Vendors had not provided a survey as required under the APS, which Bhatia specifically noted was very important. He also recorded again Miao’s statement that “friends” told him not to close the 32 Woodhaven deal and Bhatia’s response that this was dangerous and pushing again to see if Miao could in fact close.

[119] Bhatia’s entry next notes Miao’s emphatic insistence that he could not close, that he did not have enough money, and that the property prices had dropped due to the market crash. On that issue, Bhatia wrote “Real truth: market crashed!” and explained in his testimony that Miao again confirmed that the drop in values was a significant part of his motivation to get out of the deal.

[120] Based on these meetings, as well as Miao (and Cynthia)’s instructions, Bhatia proceeded to draft the letter that he sent to Mr. Muinuddin (also addressed to the brokers and agents), dated July 12, 2017. Bhatia acknowledged that the letter included virtually every conceivable basis on which to void the deal but that the main issue, and the only one that had any real chance, was the alleged non-delivery of a survey (and to some extent the related question about the accuracy of the Vendors’ representations about lot size).

[121] Bhatia testified that when he received the responding letter from Mr. Muinuddin, as well as Miao’s apologetic acknowledgment that he had in fact received a survey within a day of executing the APS and had signed a waiver of the survey condition at that time, he spoke with Miao again, telling him that “we are screwed” and that Miao was not helping by failing to disclose everything to him.

[122] Bhatia maintains that he again encouraged Miao to consider settlement and that Miao should not only be prepared to forfeit the deposit but also, given the market crash, should expect to pay additional amounts on account of the Vendors’ inevitable inability in that context to resell the property at the price to which Miao had agreed in the APS. Miao’s response was that (as he stated on June 26, 2017) he had already tried settling and that in any event he did not have the money to settle.

[123] The balance of Bhatia’s evidence largely confirmed the events described above, confirming that Miao did not close the deal on the Closing Date or otherwise, that litigation predictably ensued, and that during the course of the litigation, particularly by mid-2018, Miao’s behavior deteriorated and the relationship became strained, ultimately leading to a parting between them and the claim before me.

Conclusions re Differing Versions of Events

[124] Where Bhatia’s evidence differs from that of Miao, generally speaking, I prefer Bhatia’s account. In particular, with respect to the critical issue of whether or not Bhatia provided a “100‑120%” guarantee, or any guarantee for that matter, I accept Bhatia’s evidence that he did not do so. In addition to according with common sense, Bhatia’s version is backed up by his note of June 26 (and to a lesser extent by the notes of June 27 and July 4 inasmuch as they speak of Bhatia’s advice about the difficulty of Miao’s position and the encouragement to revisit a possible settlement), and by the email, albeit in relation to 996 Portminster, on July 17, 2017.

Shortcomings in Bhatia’s Conduct

[125] That is not to say that I found Bhatia’s conduct to be flawless. For one thing, Bhatia oddly and insistently denied meeting Mr. Muinuddin at or on the eve of the Closing Date. Bhatia made this denial notwithstanding Mr. Muinuddin’s detailed and credible account of having attended Bhatia’s office with the tender package, having met with Bhatia, having been treated discourteously and left to wait for extended periods of time, and ultimately not being able to leave the package with Bhatia (at least personally) as he had intended.

[126] The parties agree that apart from impacting credibility, the specific events alleged with respect to the attempted tender do not matter in this litigation. There is no doubt that the Vendors were in a position to close the deal and no doubt that Miao had no intention of doing so with the result that nothing in this action turns on the question of the legitimacy of the tender. As such, I do not really understand Bhatia’s insistence that the events described by Mr. Muinuddin in that context did not happen. I conclude, particularly since Bhatia had nothing to gain by denying these events, that Bhatia genuinely could not recall them. That said, I have no reason to disbelieve Mr. Muinuddin’s account.

[127] In addition, I believe Bhatia’s conduct, particularly as embodied in his letters of July 12 and July 17, 2017, was unduly aggressive given Bhatia’s clear understanding as specifically acknowledged in his testimony, that as of July 12 only the issue about the survey (based on Miao’s inaccurate advice that no survey was provided) had any chance of success and his further understanding that by July 17 none of the items laid out in his letter had any real prospect of success.

[128] While I appreciate that counsel sometimes have to be inventive and to assert positions, even aggressively, that have little or no chance of success, I do not appreciate Bhatia’s intemperate language in advancing these various futile positions, veering into ad hominem attacks on Mr. Muinuddin’s alleged failure to understand Bhatia’s points, and going so far as to threaten sanctions under the Law Society of Ontario’s Rules of Professional Conduct. In circumstances in which Bhatia understood the positions he was articulating were largely without merit, such attacks and threats are in my view not appropriate, are counterproductive, and tend to lower the reputation of the profession in the eyes of the public.

[129] I also observe that the best practice in the circumstances would have been for Bhatia to confirm to Miao in writing at the outset and ideally in the form of an opinion, but at the very least in a contemporaneous document, Bhatia’s advice that the positions Miao was instructing him to take were not meritorious and unlikely to succeed and Bhatia’s advice that Miao should instead revisit the idea of settlement.

[130] I do not believe that Bhatia’s failure to do so fell below the standard required of him and there is no expert opinion to that effect offered by the plaintiff, but for the reasons I have set out above, Bhatia’s conduct was not optimal and was in some instances regrettable.

Expert Evidence

[131] On the topic of expert reports, Miao filed as an exhibit, with Bhatia’s consent, the expert opinion of Mr. Robert Aaron (without calling Mr. Arron to testify). While Mr. Aaron’s credentials and experience are impeccable, and his opinion unassailable, that opinion focusses on the obligations of a transactional real estate lawyer (of which Mr. Aaron has been an expert practitioner for many years), and boils down to saying that if Bhatia gave the “100-120%” guarantee, doing so would fall below the standard of care required. I have found that Bhatia did not do so, such that, for all of its inarguable virtue, Mr. Aaron’s opinion does not get the plaintiff where he needs to go to succeed.

Observations about Miao’s Finances

[132] I should also note that I have not - and in my view need not - come to a firm landing on the question of whether or not Miao had the necessary funds to close the 32 Woodhaven deal as of the Closing Date. Specifically, I have not definitively determined whether Miao had the necessary resources at the time and, as such, was lying to various people (including Bhatia) in claiming that he did not, or, alternatively, in fact lacked the necessary resources at the time, such that he was telling the truth then and lying now (under oath at trial).

[133] While I can say that Miao has not provided sufficient evidence to prove that he had the necessary resources to close the deal at the time, I do not think there is a need to make a definitive finding in that regard.

[134] That is, either way, I find Miao’s lack of candor troubling, and prefer Bhatia’s evidence about the key issues (notwithstanding the other concerns I have mentioned above about Bhatia).

[135] If, as I have found, Bhatia did not give Miao the alleged guarantee and in fact advised Miao about the shortcomings of his position relative to 32 Woodhaven, and repeatedly encouraged Miao to revisit the idea of settling, as I have found Bhatia did, then in my view Miao cannot succeed against Bhatia, whether or not he had the resources to close the 32 Woodhaven deal (and if he did, chose not to close the deal). Based on my findings, Bhatia’s conduct did not breach the standard required of him and was not causative of any loss on the part of Miao.

Lack of Evidence of Causation of Loss

[136] On that latter point, I also lack evidence from which I could find that Bhatia’s conduct caused Miao to suffer a loss even if I had found a breach of the standard of care. This is problematic for Miao given that it is well-established that loss (caused by the defendant) is an essential element in negligence actions: Clements v. Clements, 2012 SCC 32, [2012] 2 S.C.R. 181, at para. 46.

[137] That is, as set out above, through the able efforts of Mr. Arnold, (which may or may not have been assisted by Bhatia’s ongoing earlier intransigence), Miao settled the Underlying Litigation on the basis of a payment of $135,000 all inclusive.

[138] At the time Miao was contemplating refusing to close the 32 Woodhaven deal and in the early context of the litigation that followed, the Vendors were demanding upwards of $400,000 to $500,000 comprised of not only the deposit, but damages to account for the fact that they could not resell their house for the amount Miao had agreed to pay (they ultimately sold it for more than $300,000 less than the price in the APS).

[139] It is difficult to imagine - and more importantly, there is no evidence before me to suggest that - had Miao engaged in meaningful negotiations during the period before and immediately after the Closing Date, he would have been able to pay anything less than what he ultimately did. Indeed, it is apparent that near the time of the Closing Date, the Vendors’ sights were set higher and, arguably, it is only the passage of time, the costs of litigation, and perhaps even Bhatia’s intransigence combined with Mr. Arnold’s effective negotiation, that caused them to lower those sights and accept the amount they did.

[140] Similarly, I have insufficient evidence to find a loss by comparing the actual amount Miao paid to settle the Underlying Litigation to his position had he closed the 32 Woodhaven transaction (assuming for this purpose that he would have been able to do so).

[141] I know (or can infer) that because of the dip in the residential real estate market in and around Toronto in 2017 that, had Miao closed on 32 Woodhaven, the property would have had a value on the Closing Date considerably less than the purchase price.

[142] Assuming that to be the case, Miao might have crystalized a loss, at least on the Closing Date, greater than the amount he ultimately paid to settle the Underlying Litigation had he closed the 32 Woodhaven transaction.

[143] Again, however, I have no evidence from which to make that comparison nor any evidence about what would have happened in the longer term if Miao had the funds to close the 32 Woodhaven deal and did so.

[144] Given the natural history of the Toronto and area residential real estate market for the last many years, it is possible to speculate that the value of 32 Woodhaven would eventually have recovered, (and maybe even relatively quickly), but I have no evidence about the value of the property specifically, and trying to calculate notional damages on a comparative basis, even if I were inclined to do so, is not possible on the record before me.

[145] All by way of saying that the evidence before me does not demonstrate that Miao’s loss, by taking the course that he did, was any greater than the loss he would have suffered if he had taken one of the other courses available to him in and around the Closing Date.

[146] That still leaves the claim for a refund of Bhatia’s accounts. Inasmuch as I have not found Bhatia’s conduct to fall below the standard required, I see no basis to order the fees to be repaid.

[147] Moreover, and again on that front, I do not have sufficient evidence to order a repayment even if I were inclined to do so. First, the accounts presented in evidence include Bhatia’s charges for both 32 Woodhaven and 996 Portminster. The latter property (and accounts) are not the subject of this claim, but the overall amount claimed in the statement of claim does not differentiate between the two sets of accounts such that the global amount claimed under this head is acknowledged to be overstated. While detailed accounts were included in the evidence that on their face appear to apply to one property or the other, there was no attempt to go through the accounts in detail, nor to identify which charges might be valid and which are not. The operative assumption appears to be that everything Bhatia did (relative to 32 Woodhaven) was wrong, such that all amounts paid should be refunded. I do not believe, however, that the evidence supports that approach.

[148] More particularly and secondly, even if Bhatia had acted as the plaintiff says he should have, impressing upon Miao and persuading him that it would be foolhardy to simply refuse to close the 32 Woodhaven deal and persuading him to negotiate, it is not clear, and there is no evidence to demonstrate, which steps would have been necessary and legitimately chargeable if that approach had been possible and had been followed.

[149] Each party submitted and relied on various cases with features similar to the case before me. While the cases were generally helpful, in my view this case, as counsel announced to me in their openings, really depends on findings of credibility.

[150] Mr. Arnold, on that score, put together a brief of cases in which Bhatia had been unsuccessful litigation counsel (and in one case partially successful), and in some instances had attracted critical comment from the judges hearing those cases. However, particularly inasmuch as those cases turned on their own individual facts, I did not find them helpful. They were proffered to suggest that Bhatia’s conduct in this case is consistent with his “modus operandi”, but frankly, they do not support that proposition and the fact that Bhatia has been unsuccessful in some other cases (and presumably successful in others), is of no moment to the questions with which I must deal with here.

[151] Ultimately, I must judge this case on the basis of the facts before me. In my view, Miao was largely the author of his own misfortune and cannot blame Bhatia for the predicament in which he put himself into before ever meeting Bhatia. While Bhatia’s conduct was imperfect, Miao himself was also largely responsible for driving the events from the time of his initial meeting with Bhatia onward.

Conclusion

[152] For all of these reasons, I find that the plaintiff’s claim must be dismissed.

Costs

[153] The parties should discuss costs and attempt to resolve them. If that proves impossible, counsel may contact me to discuss a process to determine those costs.

[154] That parties may have 20 days (January 31, 2022) in which to discuss a resolution of costs. If no agreement is reached, they may contact my judicial assistant to set up a case conference to discuss next steps.

[155] I would be remiss if I did not thank counsel for their good work, courtesy, and professionalism throughout the trial. This made my task considerably easier and I am indebted to them for their efforts.

W.D. Black J. Date: January 10, 2022