Court File and Parties

COURT FILE NO.: CV-18-77263 DATE: 2023/08/10 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Stayside Corporation Inc., Plaintiff AND Cyndric Group Inc. and Richard Menard, Defendants

BEFORE: Justice A. Doyle

COUNSEL: Peter Liston, Counsel, for the Plaintiff Stéphane Émard-Chabot, Counsel for the Defendants

HEARD: June 5 and 26, 2023

Ruling on a Summary Judgment Motion

Overview

[1] The defendants bring this motion for a summary judgment dismissing the claim of the Plaintiff, Stayside Corporation Inc., (“Stayside”) on the following basis:

• Stayside has no standing under the agreement of purchase and sale (“APS”) entered into between the vendor, the Defendant Cyndric Group Inc. (“Cyndric”) and the purchaser, 6773711 Canada Inc. in trust (“677”) for the sale of approximately 50 vacant acres (“50 acres”); and
• That the APS came to an end on April 6, 2018, when Cyndric elected to terminate the APS based on 677’s anticipatory breach.

[2] Stayside argues that this is not an appropriate case for a summary judgment as the parties have been unable to agree on any of the underlying facts and credibility issues have arisen. In addition, the court will need to determine the defendants’ subsequent severance of the property and the legitimacy of the unilateral repudiation of the APS. A trial with viva voce evidence is required for the court to make these findings. It also submits that the court should not deal with the equitable claim of specific performance on a summary judgment motion.

[3] At the original hearing, Stayside requested an order adding 677 as a party to the proceedings. Since there was no formal motion before the court, Stayside was permitted to file motion materials and the defendants were permitted to respond. The court heard oral submissions.

[4] The issues for the court’s determination are:

1. Should the court exercise its discretion and add 677 as a party. If not, then does Stayside have standing?
2. Is there a genuine issue requiring trial?

[5] For the reasons set out below, the court grants an order adding 677 as a party to the claim and the court grants summary judgment dismissing the plaintiffs’ claim on the basis of the plaintiffs’ anticipatory breach.

Outline of Events

APS

[6] 677 was incorporated on May 17, 2007. Mr. Charles Guilbeault is its sole shareholder and director.

[7] Stayside was incorporated on November 2, 2015. Ms. Christine Brooks, the wife of Mr. Guilbeault, is the sole director and shareholder of Stayside. Mr. Guilbeault states that he is the Chief Executive Officer of Stayside.

[8] In his cross-examinations, Mr. Guilbeault confirmed that Ms. Brooks and he intended that 677 would assign Stayside its rights and obligations under the APS.

[9] Pursuant to the APS dated August 13, 2014, Cyndric agreed to sell 50 acres of its 100 acres (“the property”) to 677. This property is located at 124 St. Pierre Road near Highway 417 in the Township of Russell.

[10] The APS was entered into by the following parties: Cyndric (represented by Richard Ménard) and 677 (represented by Mr. Charles Guilbeault).

[11] The APS provided for the following:

• 677 would purchase the 50 acres for $3.5M with a $1 deposit and with $1M due on closing with the balance of $2.5M payable by way of a vendor take back mortgage;
• Clause 5 states that closing would be completed within 30 days following the waiver of conditions by 677 provided that Cyndric had obtained the severance. It also stated that: “Otherwise the Closing shall occur 30 days after the Vendor has achieved; and expiry of any appeal period, the Severance.”;
• Clause 11 sets out the following: This Offer to Purchase, the agreement resulting from acceptance thereof and the Purchaser’s obligations herein are subject to the following Purchaser’s Condition being satisfied or waived by the Purchaser in writing on or before December 5, 2014; The Purchaser being satisfied, in its sole and unfettered discretion, the Property is suitable for its intended development; The Purchaser, in its sole and unfettered discretion, at any time during the conditional period may instruct the Vendor to commence the severance of the fifty acres by written notice to Vendor and payment of $5000 in cash or certified cheque;
• Clause 12 indicated that 677 could make applications for things such as zoning amendments, site plan approval and building permits. Cyndric agreed to cooperate and sign all necessary documents relating to these applications.
• Clause 16 confirmed that the APS is the entire agreement and that there was no representation, warranty, collateral agreement or condition affecting the agreement;
• Clause 22(a) confirmed that ‘time shall be of the essence”; and
• Clause 22(g) stipulated that Cyndric would obtain the severance of the 50 acres as shown as “A” on the attached plan of Survey to the APS.

[12] The 50 acres relates to the westernmost section of the property which fronts on St-Guillaume Road. The 50 acres is included in eighty acres of the property which are zoned “Industrial Park Zone – Un-serviced (MP2)” and are designated as forming part of the 417 Industrial Park under the township of Russell’s official plan.

[13] The remaining 20 acres of the property are zoned as “Agricultural (A2)” for agricultural use and includes Mr. Richard Menard’s home.

[14] By virtue of the term of the APS and the statutory requirement under s. 53(17) of the Planning Act, R.S.O. 1990, c. P.13, the transaction could not take place until the municipality consented to the severance of the 50 acres from the remaining property. Therefore, a severance was necessary for the purchase to take place.

Events after the execution of the APS

[15] By December 15, 2014, 677 had not waived conditions nor did it provide the amount of $5,000 for Cyndric to apply for a severance.

[16] Mr. Richard Menard and Mr. Charles Guilbeault communicated by emails confirming that 677 was still interested in purchasing the 50 acres.

[17] The parties agreed by way of email communications in February 2015, without any formal amending agreement, that 677 would be responsible for the severance of the 50 acres.

[18] Mr. Guilbeault’s email to Mr. Menard dated March 20, 2015, confirmed that the agreement had been extended to March 31, 2015.

[19] On March 31, 2015, Mr. Guilbeault confirmed that the property was suitable for its intended development, thereby waiving a condition in the APS.

[20] The severance did not take place despite two applications brought by 677.

[21] Ultimately, nearly three years later, on March 12, 2018, Mr. Menard informed Mr. Guilbeault that he was not prepared to provide any further extensions for completion of the severance process.

[22] The next day, Mr. Guilbeault threatened Mr. Menard with a lawsuit to be commenced by Stayside.

[23] On March 23, 2018, 677 was dissolved by Corporations Canada for lack of compliance and reporting requirements.

[24] On April 6, 2018, Cyndric advised 677 that the APS was terminated.

Should the court add 677 as a party to the claim?

Introduction

[25] On March 23, 2018, 677 was dissolved by federal authorities for non-compliance with its filing obligations and remained dissolved until January 4, 2023, when it was reactivated.

[26] Cyndric learned of the existence of Stayside on March 23, 2018, when Mr. Guilbeault referred to it in an email.

[27] From the commencement of the APS, Cyndric had been exclusively dealing with 677 through Mr. Guilbeault.

[28] There were no documents produced that showed 677 had assigned its interest to Stayside or that 677 was acting as an agent or for another entity.

[29] The statement of claim was issued in July 2018 and the statement of defence was filed on January 15, 2020, and on January 24, 2020, Richard Menard was added as a defendant. At that time the plaintiff was granted leave to file a Certificate Pending Litigation (“CPL”) which was registered on January 30, 2020.

[30] The amended statement of claim was served and filed on February 4, 2020.

[31] According to Mr. Guilbeault, due to an oversight, 677 defaulted on its obligation to file annual renewals with Corporations Canada and 677 was administratively dissolved on March 23, 2018. Therefore, at the time of the issuance of the statement of claim, 677 did not exist as a legal entity.

[32] Mr. Guilbeault filed articles of revival and a certificate of revival for 677 was issued on January 4, 2023.

[33] At paras. 11 to 13, the statement of defence explicitly raises the issue of Stayside not having standing to bring this action.

[34] The defendants have consistently maintained that the plaintiff did not have standing and this position forms one of the bases of their motion for summary judgment dated April 2022.

[35] The plaintiff did not request an amendment to include 677 until the eve of the summary judgment motion, five months after the originally scheduled date (after it was delayed twice on contested adjournments).

Plaintiff’s Position

[36] The plaintiff has brought a motion to add 677 as a party under Rules 5.04 and 26.01, of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, (“the Rules”).

[37] It submits that there is no prejudice to the defendants as the facts it relies on are the same. The defendants had full notice of the issues and surrounding circumstances of the case.

[38] There is no element of surprise.

[39] It admits that there may have been some “sloppiness” between Stayside and 677 as they are at non-arms-length and controlled by spouses.

Defendants’ Position

[40] The defendants submit that since Cyndric elected to treat the APS as repudiated on April 6, 2018, then as the Plaintiff’s claim is based on a breach of contract, the limitation period expired on April 6, 2020 (over 3 years ago).

[41] In addition, the defendants argue that an amendment would constitute a non-compensable prejudice to the defendants as it would take away their right to rely on the expiry of the limitation period during the time that 677 was a dissolved entity. Adding 677, would in effect override the defendants’ statutory post-dissolution right which runs counter to the legislative intent.

[42] It is trite law that corporations are separate entities under the law.

[43] The expiry of a limitation period during the time a corporation is considered dissolved constitutes a statutory post-dissolution right. See s. 209 of the Canada Business Corporations Act, R.S.C., 1985, c. C-44, (“CBCA”).

Legal Framework

[44] Rule 5.04 of the Rules of Civil Procedure provides as follows:

5.04 (1) No proceeding shall be defeated by reason of the misjoinder or non-joinder of any party and the court may, in a proceeding, determine the issues in dispute so far as they affect the rights of the parties to the proceeding and pronounce judgment without prejudice to the rights of all persons who are not parties. R.R.O. 1990, Reg. 194, r. 5.04 (1) .

(2) At any stage of a proceeding the court may by order add, delete or substitute a party or correct the name of a party incorrectly named, on such terms as are just, unless prejudice would result that could not be compensated for by costs or an adjournment. R.R.O. 1990, Reg. 194, r. 5.04 (2) .

(3) No person shall be added as a plaintiff or applicant unless the person’s consent is filed. R.R.O. 1990, Reg. 194, r. 5.04 (3) .

[45] Rule 26.01 reads that:

On motion at any stage of an action the court shall grant leave to amend a pleading on such terms as are just, unless prejudice would result that could not be compensated for by costs or an adjournment. R.R.O. 1990, Reg. 194, r. 26.01 .

[46] In Mazzuca v. Silvercreek Pharmacy Ltd., the Ontario Court of Appeal stated that Rule 5.04(2) provides the court with the power of amendment and that the moving party must demonstrate that no prejudice would result from the amendment that could not be compensated for by costs or an adjournment. It found that despite the mandatory language of Rule 26.01, Rule 5 gives the court the discretion to permit or deny the addition of a party.

[47] At paras 41 and 42, the Court of Appeal stated:

[41] The established principles concerning rules 26.01 and 5.04(2) confirm the continuing importance, as a base consideration, of the issue of actual prejudice in determining applications to amend pleadings, including those designed to add, delete or substitute parties, after the expiry of a limitation period. The centrality of this issue is also confirmed by the express language of rules 26.01 and 5.04(2) in their current form. Both the related jurisprudence and the rules themselves thus underscore a simple, common sense proposition: that a party to litigation is not to be taken by surprise or prejudiced in non-compensable ways by late, material amendments after the expiry of a limitation period. If such surprise or actual prejudice is demonstrated on the record, an amendment generally will be denied.

[42] At the same time, proof of the absence of prejudice will not guarantee an amendment. Rather, when a change of parties is sought after the expiry of a limitation period, the circumstances of all affected parties should be examined to determine, on the facts of the individual case, whether sufficient special circumstances are present to support the requested amendment. In those cases where leave is sought to add, delete or substitute a new party, the examination of special circumstances involves consideration of the knowledge of both the moving party and her agents at the time of the commencement of the proceedings regarding the proper parties to be named and of the opposing party in relation to the nature of the true claim intended to be advanced.

[48] Once this threshold has been met, under Rule 26.01, the court must grant leave to amend.

[49] At para. 25 of Mazzuca, the Court of Appeal referred to Holmstead & Watson: Ont. Civil Procedure, Vol 2 (Toronto: Carswell 1993) at p. 5-34 to 5-35, which stated that Rule 5.04(2) grants the court discretion to ensure procedural fairness including issues such as: state of the action, whether trial is imminent, and whether examinations for discovery have taken place.

[50] The Court of Appeal also referred to Basarsky v. Quinlan, [1972] S.C.R. 380, where the Supreme Court held that it is possible to add parties after the expiration of a limitation period in “special circumstances”. In that case, the Supreme Court allowed an appeal to allow an amendment to the claim under the Fatal Accidents Act, SO 1966, c 138, even though the two-year limitation period had expired.

[51] The issue of the doctrine of “special circumstances” was expanded in Canadian Imperial Bank of Commerce v. Green, 2015 SCC 60, where the Supreme Court explained:

[113] In essence, the doctrine allows a court to temper the potentially harsh and unfair effects of limitation periods by allowing a plaintiff to add a cause of action or a party to the statement of claim after the expiry of the relevant limitation period. I hasten to add that, as the Court recognized in Basarsky v. Quinlan, [1972] S.C.R. 380, and as the word “special” — or “peculiar” — suggests, the circumstances warranting such an amendment will not often occur.

[114] As an offspring of equity, the doctrine of special circumstances is naturally concerned with fairness to the parties. Indeed, this concern was at the forefront of Lord Esher’s mind in Weldon. Unsurprisingly, no exhaustive list of the circumstances that qualify as “special” has been proposed by the courts, and I believe it would be risky and unwise to do so. I note however that, concerned with not prejudicing a defendant, this Court has paid particular attention to whether the facts relevant to the extinguished action were pleaded in the original statement of claim and whether the defendant was aware of them during discovery: Basarsky; see also Dugal, at paras. 60-68. The factors enumerated by the Ontario Court of Appeal in Frohlick v. Pinkerton Canada Ltd., 2008 ONCA 3, 88 O.R. (3d) 401, at para. 23, which were reiterated by van Rensburg J. in IMAX, are also helpful guides:

As such, “special circumstances” include factors such as: the relationship between the proposed claim and the existing action; the true nature of all of the claims; the progress of the action; and the knowledge of the parties… [IMAX, at para. 71]

[52] The expiry of a limitation period leads to a rebuttable presumption of prejudice which may be rebutted by evidence that the party received notice of the claim within the limitation period.

[53] In Tantawy v. Casa Verde, at para. 14, the court stated that it should exercise its discretion sparingly when adding a party when there has been the expiry of a limitation period.

[54] Section 209(4) of the Canada Business Corporations Act states:

(4) Subject to any reasonable terms that may be imposed by the Director, to the rights acquired by any person after its dissolution and to any changes to the internal affairs of the corporation or other body corporate after its dissolution, the revived corporation is, in the same manner and to the same extent as if it had not been dissolved,

(a) restored to its previous position in law, including the restoration of any rights and privileges whether arising before its dissolution or after its dissolution and before its revival; and

(b) liable for the obligations that it would have had if it had not been dissolved whether they arise before its dissolution or after its dissolution and before its revival.

[55] Barring the presence of equitable considerations, this right has been considered a bar to initiating an action. Sutherland Lofts Inc. v. McGee, 2011 ONSC 5160, Justice Leitch stated:

[23] I am satisfied that the law is clear that even if the corporation is revived, it is still subject to a missed limitation period. A limitation period is a right acquired within the meaning of the Business Corporations Act. In 602533 Ontario Inc. v. Shell Canada Ltd. (1998), 37 O.R. (3d) 504 (C.A), the issue was whether Shell could enforce a limitation period upon 602533’s revival which expired during the period that 602533 was dissolved. The Court of Appeal held that 602533 could not commence a claim because it was not a legal person at the time it issued its statement of claim. The expiry of a limitation period when 602533 was a dissolved corporation was a right acquired by Shell which it could maintain on the revival of 602533 such that the claim was statute barred.

[24] The Shell Canada case is an important decision because it considered conflicting decisions on this issue. In that case, the notion that the expiry of the limitation period was something other than an accrued legal right of a defendant was rejected even though it was observed that Shell at all material times was fully aware of the claim against it and responded accordingly in the belief that 602533 was a viable legal entity (see para. 21). Nevertheless, it was observed at para. 24 “that the passage of a statutory limitation period confers an accrued legal right on a defendant is well established.”

Discussion

[56] The court will proceed with the 2-part test set out in Mazzuca.

Surprise or prejudice?

[57] The first step is to determine whether the defendants were taken by surprise.

[58] In its factum at para. 39, Stayside states that Stayside and 677 are non-arms-length corporate entities wholly owned by husband and wife and “Some degree of ‘sloppiness’ in the conduct of the corporations’ business dealings is not unexpected…”

[59] The internal workings within the corporation and possible mismanagement or “sloppiness” does not justify the wrong party bringing the claim in a legal action.

[60] However, “6773711 Canada Inc. in trust” was a party to the APS. Cyndric knew that 677 was acting on behalf of another entity as the APS said it was “in trust”.

[61] Although there is no real evidence of an assignment, it is clear that 677 was acting on behalf of another entity. Stayside, according to the plaintiff was the assignee and there is correspondence from Mr. Guilbeault indicating that he is communicating on behalf of Stayside. This was pleaded in the Statement of Claim and hence the defendants had notice of this relationship and the role of 677 and Stayside.

[62] From the outset, in the statement of defence, the defendants have argued that Stayside had no standing. This is again articulated in the summary judgment motion materials.

[63] They should not be surprised that 677 now wishes to be added as a party.

[64] The next issue is to determine whether the defendants are prejudiced by the delay in bringing this motion to add 677.

[65] One would expect that in commercial transactions involving the sale of property valued for multiple million dollars that the parties to the contract would have the legal right to bind the corporation, and if a party is acting on behalf of another party, it will produce the assignment.

[66] The plaintiff showed lack of diligence in bringing this motion to amend. New counsel at the motion before me has only been on the file since March 2023 and is not in a position to offer an explanation as to the delay in bringing this issue forward.

[67] The plaintiff was represented by the same counsel from 2018 to March 2023. The original summary judgment motion was scheduled for January 2023 but plaintiff’s counsel obtained an adjournment. There was a revival of 677 on January 4, 2023, and a motion to amend could have been brought then.

[68] If 677 is added as a party, the statement of claim will not require amendment and the principal players from the corporate entities have been cross-examined (Mr. Menard and Mr. Guilbeault). The defendants would have a right to file an amended statement of defence and plead limitation periods.

[69] In addition, the documentation has been exchanged since both parties have presumably put their “best foot forward” for this summary judgment motion.

[70] The court notes that, although a low bar, the defendants consented to the registration of a CPL by Stayside even though they took the position that Stayside was not the proper party.

[71] In addition, there is no new tort or contractual breach created if 677 is added as a party to the claim.

[72] An amendment merely identifies the proper corporate entity and any prejudice to the defendants can be compensated by an order of costs.

Special circumstances?

[73] A concise summary of the doctrine of special circumstances is set out by Justice Newton in Suggashie et al. v. Tikinagan Child & Family Services et al., 2022 ONSC 3440:

[46] As set out in Omerod (Ormerod v. Strathroy Middlesex General Hospital, 2013 ONSC 922)

a. First, the phrase “special circumstances” has not been defined and an exhaustive list of factors does not exist;

b. Second, the person seeking to proceed notwithstanding the expiry of a limitation period bears the onus of:

i. Rebutting the presumption of prejudice to the person otherwise entitled to rely upon it: and

ii. Satisfying the court that special circumstances exist.

c. Third, while the application of the doctrine seems to be a discretionary one, the exercise of discretion is subject to an underlying and guiding principle: limitation periods were not created to be ignored. Consequently, the jurisdiction to invoke the doctrine of special circumstances will be exercised sparingly. [16]

[47] The expiry of a limitation period leads to a rebuttable presumption of prejudice. The presumption may be rebutted by evidence that the party received notice of the claim within the limitation period. [17]

[74] Mazzuca discusses the issue of the difference of adding a defendant after the expiry of a limitation period compared to adding a plaintiff. At paras. 39-40, the Court of Appeal stated:

[39] In the present case, the motions judge stated as follows with respect to the requirement of "special circumstances":

The courts have refused to add parties to an action after the expiry of a limitation period unless "special circumstances" are shown: Swain Estates v. Lake of the Woods, supra; Swiderski v. Broy, supra; Knudsen v. Holmes (1995), 22 O.R. (3d) 160 (Ont. Ct. Gen. Div.). However, the same considerations do not apply to a person who was formally put on notice of a claim and made a party to an action within the limitation period. In my opinion, it is not necessary to show special circumstances in order to substitute a plaintiff for an existing plaintiff when no prejudice is caused by the amendment. However, if special circumstances are required, they exist in this case.

[40] To the extent that this conclusion suggests, in the absence of proof of actual prejudice to a defendant, that generally it will be less difficult to substitute or add a new plaintiff for an originally named plaintiff than might be the case with respect to the addition of a new or different defendant, I agree. However, I respectfully do not agree that proof of special circumstances will never be required absent proof of prejudice when it is sought under subrule 5.04(2) to add or substitute a new plaintiff. In my view, subrule 5.04(2) contemplates that the existence or absence of special circumstances warranting the amendment should be considered as one of the factors to be considered in determining whether a discretionary amendment is to be permitted or denied after expiry of a relevant limitation period. There may well be circumstances where, by virtue of the original plaintiff's conduct or the demonstrated knowledge of counsel at the time of the commencement of the proceedings, an amendment under subrule 5.04(2) should be denied.

[75] The plaintiff bears the onus to show special circumstances.

[76] The court is to consider procedural fairness when exercising its discretion and look at the situation holistically. The court must consider if there are equitable principles and special circumstances.

[77] In this case, the facts and issues will not change if 677 is a party.

[78] In fact, the defendants argue that there has been an anticipatory breach but the party (i.e. 677) that created the alleged conduct is not before the court if the amendment is denied.

[79] Even though the plaintiff has been put on notice since the time that the statement of defence was filed that Stayside has no business in this litigation, for the court to properly determine whether summary judgment should be granted, the proper parties must be before the court.

[80] In this case, special circumstances exist for the court to properly determine the issue of the summary judgment before the court. 677 was the party to the APS that created the situation by its conduct of anticipatory breach. 677 should be before the court.

[81] As stated in 6025333 Ontario Inc. v. Shell Canada Ltd., the Court of Appeal confirmed that the expiry of a limitation period during the time a corporation is considered dissolved constitutes a statutory post-dissolution right. See s. 209 of the CBCA. The post-dissolution right of the defendants is a statutory right.

[82] As stated by Hood J. in Munas v. Yusuf, 2015 ONSC 5443,

[12] I find that Yusuf is not estopped from bringing a motion based on a limitation defence. While it is an option for a party-to-be to challenge a motion under rules 26.01 and 5.04 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 to amend a claim seeking to add them as a party defendant, I do not find that they must do so at that stage or be estopped from raising it later. Certainly, it is an option to oppose then but it is not mandatory to do so. The defendant, once added, is then entitled to plead their defence, including a limitation defence. Like any defendant, they are then free to bring a summary judgment motion on that defence.

[83] In conclusion, in determining whether there are special circumstances I have considered the totality of the factual background, including the conduct and circumstances of the parties. Those facts include:

a. The defendants were aware of the underlying facts of the parties to the APS; b. The purchaser to the agreement is in a trust capacity which was known to the defendants; c. The statement of claim pleaded the facts of 677 in trust for Stayside; and d. 677 should be added as a party as its conduct is relevant in the summary judgment motion.

[84] In conclusion, the court exercises its discretion to add 677 as a party to the claim. Given this conclusion, it is not necessary to determine if Stayside has standing for the purposes of this motion.

Is there a genuine issue requiring a trial on the issue of whether Cyndric was entitled to terminate the APS based on the anticipatory breach of 677?

Introduction

[85] For the reasons that follow, the court finds that there is no genuine issue requiring a trial. The court can render a fair and just determination on the merits. The court has an extensive record of affidavits, transcripts of cross-examination and documentary evidence attached to the affidavits which provide the court with sufficient objective evidence to make determinations on the issues.

[86] The court can make necessary findings of fact and there are no credibility issues that require a trial. The court finds that the summary judgment is a proportionate, more expeditious, and less expensive means to achieve a just result.

[87] The central issue in determining whether a summary judgment should be rendered is whether the conduct of the plaintiff in not diligently proceeding with a severance application amounted to an anticipatory breach thereby justifying the plaintiff’s termination of the APS.

[88] When referring to the conduct of 677 as a party to the contract, the court will interchangeably refer to Mr. Guilbeault (its representative) and “the plaintiffs”.

[89] The plaintiffs were required to put their best foot forward and set out the relevant evidence with specific facts and coherent evidence thus demonstrating that there is a genuine issue for trial. They have failed to do so.

[90] In fact, as will be explained in more detail below, the court does not find that the record supports the plaintiffs’ position that delay in obtaining a severance was caused by Mr. Menard’s failure to provide confirmation that he could bind Cyndric, nor is there proof of any delay on the part of the municipalities involved.

[91] There is confirmatory evidence that the typical process to obtain a severance in this is approximately 90 days from the time that the application is filed. This was confirmed by the parties to the APS and by the representative of the United Counties of Prescott & Russell (“UCPR”).

[92] In addition, there is no genuine issue requiring trial on the plaintiffs’ claim for specific performance as they were not “at all times and (still is) ready, willing and able” to proceed with the purchase which is a prerequisite set out in DiMillo v. 2099232 Ontario Inc. 2018 ONCA 1051, 2018 ONCA1051.

[93] Not only did the plaintiffs fail to proceed to obtain a severance, they did not provide evidence that they had access to funds which would be due on closing as under cross-examination, Mr. Guilbeault objected to questions pertaining to Stayside’s ability to access funds to close.

[94] In addition, in accordance with Semelhago v. Paramadevan, specific performance would not be granted unless there is evidence that the property is “unique” or that “its substitute would not be readily available”. Dimillo at para. 65.

[95] As stated in John E. Dodge Holdings Ltd. v. 805062 Ontario Ltd. (2003) 52131 (ON CA) at paras. 38 -40:

[38] In Semelhago v. Paramadevan, [1996] 2 S.C.R. 415, 136 D.L.R. (4th) 1 at para. 22, Sopinka J. observed that specific performance will only be granted if the plaintiff can demonstrate that the subject property is unique in the sense that, "its substitute would not be readily available". Although Sopinka J. did not elaborate further on this definition, in 1252668 Ontario Inc. v. Wyndham Street Investments Inc., [1999] O.J. No. 3188 (Quicklaw), 27 R.P.R. (3d) 58 (S.C.J.) at para. 23, Justice Lamek stated that he

[does] not consider that the plaintiff has to demonstrate that the Premises are unique in a strict dictionary sense that they are entirely different from any other piece of property. It is enough, in my view, for the plaintiff to demonstrate that the Premises have a quality that makes them especially suitable for the proposed use and that they cannot be reasonably duplicated elsewhere.

[39] I agree that in order to establish that a property is unique the person seeking the remedy of specific performance must show that the property in question has a quality that cannot be readily duplicated elsewhere. This quality should relate to the proposed use of the property and be a quality that makes it particularly suitable for the purpose for which it was intended. See also the comments of Low J. in 904060 Ontario Ltd. v. 529566 Ontario Ltd., [1999] O.J. No. 355 (Quicklaw), 89 O.T.C. 112 (Gen. Div.) at para. 14.

[40] The time when a determination is to be made as to whether a property is unique is the date when an actionable act takes place and the wronged party must decide whether to keep the agreement alive by seeking specific performance or accept the breach and sue for damages: Greenforco Holding Corp. v. Yonge-Merton Developments Ltd., [1999] O.J. No. 3232 (Quicklaw) (S.C.J.) at [page318] para. 76. It may also be that in certain cases the date chosen for determining the issue of whether specific performance is appropriate is a later date but the date will not, in any event, occur before the breach has taken place.

[96] Here, there is no evidence of any specific development plans nor did the plaintiffs secure any tenants or subsequent purchases. Merely engaging in land speculation is not enough to meet the criteria of uniqueness required by the case law.

Legal Principles

Summary Judgment

[97] Rule 20 of the Rules of Civil Procedure, provides that a court must grant a summary judgment when there is no genuine issue requiring trial. The powers of the court are set out below:

20.01 (1) A plaintiff may, after the defendant has delivered a statement of defence or served a notice of motion, move with supporting affidavit material or other evidence for summary judgment on all or part of the claim in the statement of claim.

(2) The plaintiff may move, without notice, for leave to serve a notice of motion for summary judgment together with the statement of claim, and leave may be given where special urgency is shown, subject to such directions as are just.

(3) A defendant may, after delivering a statement of defence, move with supporting affidavit material or other evidence for summary judgment dismissing all or part of the claim in the statement of claim.

20.04 (2) The court shall grant summary judgment if,

(a) the court is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence; or

(b) the parties agree to have all or part of the claim determined by a summary judgment and the court is satisfied that it is appropriate to grant summary judgment.

(2.1) In determining under clause (2) (a) whether there is a genuine issue requiring a trial, the court shall consider the evidence submitted by the parties and, if the determination is being made by a judge, 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 a trial:

1. Weighing the evidence.

2. Evaluating the credibility of a deponent.

3. Drawing any reasonable inference from the evidence.

[98] Where a summary judgment is refused or granted only in part pursuant to rr. 20.05(1)-(2), the court can specify what material facts are not in dispute, define the issues to be tried, order that the action proceed to trial expeditiously, and make numerous further orders and directions that may be just in the circumstances.

[99] As stated in Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87 at para. 49, there is no genuine issue requiring a trial when the court is able to reach a fair and just determination on the merits of the motion. This will be the case where the process (1) allows the court to make necessary findings of fact; (2) allows the court to apply the law to the facts; and (3) is a proportionate, more expeditious, and less expensive means to achieve a just result.

[100] A responding party is required to put its best foot forward and cannot simply assert a bald denial; rather, it must set out relevant evidence with specific facts and coherent evidence thus demonstrating that there is a genuine issue for trial.

[101] The Supreme Court in Hryniak v. Mauldin set out a two-step test for summary judgment:

(a) First, the motion judge must determine if there is a genuine issue requiring a trial based on the written record and without resorting to its new powers under Rule 20.04(2.1) or 20.04(2.2); and

(b) If there appears to be a genuine issue requiring a trial, the motion judge must then determine if the need for a trial can be avoided by using the new powers under Rule 20.04(2.1) or 20.04(2.2).

[102] In Joshi v. Chada, 2022 ONSC 4910 at para. 66, Justice Glustein provided a helpful overview and summary of the general principles a motions judge must follow in deciding summary judgment motions under the Hryniak regime:

[66] The relevant legal principles applicable to summary judgment are as follows:

i. The purpose of r. 20 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 is to (a) eliminate claims that have no chance of success at trial, and (b) provide judges with fact-finding powers to be used on a summary judgment motion: Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87, at paras. 44-45, and 66;

ii. The evidence on a summary judgment motion must enable the motion judge to be confident that they can fairly resolve the dispute: Hryniak, at para. 57;

iii. The motion judge’s enhanced powers allow the court to weigh evidence, evaluate credibility, and draw reasonable inferences from the evidence: Mega International Commercial Bank (Canada) v. Yung, 2018 ONCA 429, 141 O.R. (3d) 81, at para. 83;

iv. The focus of a summary judgment motion is not on what kind of evidence could be adduced at trial, but rather on whether a trial is required: Hryniak, at para. 56;

v. The court is entitled to assume that it has all the evidence that would be available at trial related to the matters at issue: Portuguese Canadian Credit Union v. Pires, 2011 ONSC 7448, at para. 11, aff’d 2012 ONCA 335;

vi. The moving party has the onus of proving that there is no genuine issue requiring a trial. Then, the onus shifts to the responding party to provide evidence of specific facts showing that there is a genuine issue requiring a trial: Sweda Farms Ltd. et al. v. L.H. Gray & Son Limited et al., 2013 ONSC 4195, at paras. 26-27, leave to appeal refused, 2014 ONSC 3016;

vii. Summary judgment is not appropriate if the credibility of the parties is squarely in issue and requires a trial: Demetriou v. AIG Insurance Company of Canada, 2019 ONCA 855, at para. 9;

viii. The more important credibility disputes are to determining key issues, the harder it will be to fairly adjudicate those issues solely on a paper record. “It is not always a simple task to assess credibility on a written record. If it cannot be done, that should be a sign that oral evidence or a trial is required”: Cook v. Joyce, 2017 ONCA 49, at para. 92, citing Trotter Estate, 2014 ONCA 841, 122 O.R. (3d) 625, at para. 55; and

ix. The court must take “great care” in assessing credibility and reliability on affidavit evidence, since “[e]vidence by affidavit, prepared by a party’s legal counsel, which may include voluminous exhibits, can obscure the affiant’s authentic voice”. Consequently, the motion court must “ensure that decontextualized affidavit and transcript evidence does not become the means by which substantive unfairness enters, in a way that would not likely occur in a full trial where the trial judge sees and hears it all”: Baywood Homes Partnership v. Haditaghi, 2014 ONCA 450, 120 O.R. (3d) 438 (C.A.), at para. 44.

Anticipatory Breach

[103] In Spirent Communications of Ottawa Limited v. Quake Technologies (Canada) Inc., 2008 ONCA 92 at para. 37, the Court of Appeal said:

I would add this. When considering Spirent's conduct, it was important to keep in mind that what was involved was an anticipatory breach of contract. An anticipatory breach sufficient to justify the termination of a contract occurs when one party, whether by express language or conduct, repudiates the contract or evinces an intention not to be bound by the contract before performance is due. See Pompeani v. Bonik Inc. (1997), 35 O.R. (3d) 417, [1997] O.J. No. 4174 (C.A.). To assess whether the party in breach has evinced such an intention, the court is to ask whether a reasonable person would conclude that the breaching party no longer intends to be bound by it. See McCallum v. Zivojinovic (1977), 16 O.R. (2d) 721, [1977] O.J. No. 2341 (C.A.). Having said that, when determining whether such an intention has been evinced, the courts rely on much the same analysis as they do in respect of claims of fundamental breach. That is, in determining whether the party in breach had repudiated or shown an intention not to be bound by the contract before performance is due, the court asks whether the breach deprives the innocent party of substantially the whole benefit of the contract.

[104] The Court of Appeal allowed the appeal as the trial judge failed to measure the breach, i.e., whether the breach substantially deprived the innocent party of the whole benefit of the contract.

[105] At para. 36, the court set out the five factors when determining whether the conduct deprived the innocent party of the whole benefit of the contract:

[36] As the trial judge also correctly noted, this court has repeatedly stated that there are five factors that can be considered when determining whether conduct has deprived the innocent party of substantially the whole benefit of the contract. The five factors are: (1) the ratio of the party's obligations not performed to that party's obligations as a whole; (2) the seriousness of the breach to the innocent party; (3) the likelihood of repetition of such breach; (4) the seriousness of the consequences of the breach; and (5) the relationship of the part of the obligation performed to the whole obligation. See Place Concorde, supra.

[106] In Spirent, the occupancy date was delayed by the plaintiff from June 1, 2001 to July 15, 2001. The Court of Appeal found this was not a fundamental breach as:

• The defendant had “swing space’ while awaiting occupancy;
• The defendant would continue in its existing lease; and
• Quake's occupancy was to last for three years. In the circumstances, a delay in occupancy of six weeks is not so significant that it amounts to deprivation of substantially the whole benefit of the Agreement.

[107] The court held that a reasonable person would not have concluded that Spirent evinced an intention to no longer be bound by the lease agreement.

[108] At para. 53:

Repudiation does not automatically bring a contract to an end. Rather, it gives the innocent party the right to elect to treat the contract as at an end. If that election is made, the parties are relieved from further performance and the innocent party may sue [page 731] for damages. As a general rule, the innocent party must make the election and communicate it to the repudiating party within a reasonable time. See Place Concorde, supra, at p. 155 O.A.C.

[109] In Place Concorde East Limited Partnership v. Shelter Corporation of Canada at paras. 51 to 53, the court stated:

[51] Repudiation occurs in circumstances where the breach deprives the innocent party of substantially the whole benefit that it was intended he or she should have obtained from the contract: Hunter Engineering Co. v. Syncrude Canada Ltd., [1989] 1 S.C.R. 426 at 499-500. A breach that allows the non-repudiating party to elect to put an end to all unperformed obligations of the parties is an exceptional remedy that is available only in circumstances where the entire foundation of the contract has been undermined, that is, where the very thing bargained for has not been provided: see Hunter Engineering, supra; see also Gordon Capital, supra, at para. 50.

[52] Various expressions have been used to define the sort of term that, if broken by one party, will excuse the other from future performance. Behind all of these expressions lies the notion of “substantial failure of performance”: see S.M. Waddams, The Law of Contracts, 5 th ed. (Toronto: Canada Law Book Inc., 2005), at para. 587. Thus, a breach of contract that rises to the level of a substantial failure of performance can operate as a repudiation of the contract.

[53] Weiler J.A. in 968703 Ontario Ltd. v. Vernon (2002), 58 O.R. (3d) 215 (C.A.) at para. 16 outlines five factors that provide guidance for the court’s determination of whether or not a breach is a substantial breach such as would justify future non-performance of the innocent party’s obligations. These factors are as follows:

• the ratio of the party’s obligation not performed to the obligation as a whole;
• the seriousness of the breach to the innocent party;
• the likelihood of repetition of the breach;
• the seriousness of the consequences of the breach; and
• the relationship of the part of the obligation performed to the whole obligation.

[110] In Pompeani v. Bonik Inc. et al., [1997] O.J. No. 4174, Osborne J.A. stated:

(c) Anticipatory breach and the failure to tender

An anticipatory breach occurs where one party to a contract repudiates the contract before performance is due: Kloepfer Wholesale Hardware & Automotive Co. v. Roy, [1952] 2 S.C.R. 465, [1952] 3 D.L.R. 705.

In Cehave N.V. v. Bremer Handels-Gesellschaft mbH, [1976] Q.B. 44 at p. 59, [1975] 3 All E.R. 739 (C.A.), Denning M.R. defined anticipatory breach in this way:

When one party, before the day when he is obliged to perform his part, declares in advance that he will not perform it when the day comes, or by his conduct evinces an intention not to perform it, the other may elect to treat his declaration or conduct as a breach going to the root of the matter and to treat himself as discharged from further performance…

Professor Waddams referred to anticipatory breach in his text, The Law of Contracts, 3rd ed., paras. 613-14 in this way:

Repudiation can be by words or conduct evincing an intention not to be bound by the contract. It was held by the Privy Council in Clausen v. Canada Timber & Lands, Ltd. that such an intention may be evinced by a refusal to perform, even though the party refusing mistakenly thinks that he is exercising a contractual right.

The innocent party is not, however, obliged to bring the action immediately. The party can continue to press for performance and bring the action only when the promised performance fails to materialize. It has been said in many cases that there is an option to "accept" the repudiation and sue at once or to ignore it and press for performance, and that an unaccepted repudiation is of no consequence.

See also Bruce Salvatore, Craig R. Carter and Paul M. Perell, Agreements of Purchase and Sale (Toronto: Butterworths, 1996) at p. 30; McCallum v. Zivojinovic (1977), 16 O.R. (2d) 721, 79 D.L.R. (3d) 133 (C.A.).

An anticipatory breach discharges the innocent party of its obligations under the contract and allows it to pursue damages without the need to tender: Bethco Ltd. v. Clareco Canada Ltd. (1985), 52 O.R. (2d) 609, 22 D.L.R. (4th) 481 (C.A.); McCallum v. Zivojinovic, supra, at p. 723.

[111] The court found that Bonik did not expressly repudiate the agreement, but rather that there was “substantial evidence of an implied repudiation”. The agreement provided that Bonik would obtain compliance of subdivision control provisions of the Planning Act and this would be obtained diligently.

[112] The court found that the agreement imposed an express obligation on Bonik "to proceed diligently" to secure Planning Act approval so that the plan attached to the agreement could be registered.

[113] Bonik made no attempt to register a plan that was approved on April 12, 1988, and instead, without notice to Pompeani, he registered a different plan (62N-623) which reduced the lot size of 12 of the 16 townhouse lots.

[114] The court summarizes its findings of anticipatory breach as follows:

I think that, taken cumulatively, Bonik's actions in abandoning the plan made part of the agreement, securing the registration of the new plan, ignoring correspondence from Pompeani's solicitor for over a year before the date of closing, demanding the profits from the flip in return for closing and failing to submit a draft deed or statement of adjustments would lead a reasonable purchaser to believe that the vendor would not honour its obligations under the agreement. Accordingly, I think that Bonik impliedly repudiated the agreement before the date of closing, thus relieving Pompeani of his obligations under the agreement and entitling him to damages. I do not think that in the circumstances Pompeani was obligated to tender.

[115] In allowing the appeal, the court found that the change of dimensions in the frontage of the property from 390 to 375 feet was a fundamental breach. The dimensions were important as the land had been identified with clarity and specificity and incorporated in the draft plan of subdivision in the agreement and a reduction in the size and consequently, the value of the lots and the vendor was aware of its importance. The court of appeal did not accept that the subject matter of the agreement could simply be changed so that 64 townhouses and 16 street townhouses could be built.

[116] There was a provision that the vendor would “proceed diligently” to secure Planning Act approval to the plan attached to the agreement and instead, without notice to the purchaser, registered a different plan with a reduced lot size.

Discussion

Subject Matter of the APS

[117] The severance of 50 acres from the total 100 acres is an essential element of the APS and a condition precedent to the land being transferred to the purchaser.

[118] The APS originally required Cyndric to complete the severance upon receipt of $5,000 from 677 and the parties agreed that the closing date would occur on or before December 5, 2014, as they expected that the severance would take place before then.

[119] The attached plan to the APS sets out the whole property and “A” was identified as the 50 acres to be transferred which was the westernmost point.

[120] The parties were specific that 50 acres were to be severed. When the parties renegotiated the terms after the closing date of December 5, 2014, had passed, a date had been set for March 31, 2015. The clauses that “time is of the essence” and that the closing would take place 30 days after the severance and appeal period remained.

[121] The fact that the parties had put their minds to the timing to complete the severance was important and significant.

[122] The original agreement was signed in August 2014 and to close in December 2014 giving approximately 4 months for the completion of the severance. It was then extended to March 31, 2015, again an extension of several months in the anticipation that severance could proceed in a timely fashion.

[123] In summary, the court can infer from the terms of the contract and the renegotiation of the contract that the severance would proceed expeditiously, and a four-month window was reasonable for a party to obtain a severance.

The Severance Process

[124] The severance application process occurred over a 4-year span without completion.

[125] A severance application which severs a lot into two lots requires the approval of the United Counties of Prescott and Russell (“UCPR” or “municipality”). The application along with the fee and certain supporting documents must be filed with UCPR who will communicate to the applicant what other requirements are necessary. After the UCPR renders its decision, there is a right to appeal.

[126] The APS acknowledged this process and permitted the deal to proceed once the appeal period was over.

[127] As noted, a severance was essential for the completion of the transfer to the plaintiff due the Planning Act and of course, it was a term of the contract.

[128] 677 failed to provide $5,000 so that Cyndric could proceed with the severance. This 4- month delay falls on the hands of 677.

[129] The parties renegotiated the purchase and used the closing date of March 31, 2015. On that date, 677 waived the condition that allowed them to confirm that the land was suitable for its intended development.

[130] 677 filed its first severance application nine months after it had agreed to take over the severance application.

[131] A letter dated February 23, 2016, from Mathieu Quesnel, counsel for the defendants at the time, to Mr. Guilbeault stated that the date of April 29, 2016 is “far enough to obtain a final decision of the Township of Russell and if by that date the Land has not been severed, the Agreement should be terminated.

[132] In exhibits to Mr. Menard’s affidavit dated September 2, 2022 (Menard affidavit), correspondence set out the delay (direct quotes are included):

• (Ex L) Mr. Hebert to Mr. Quesnel letter dated April 5, 2016 says that problem is that the municipality is unsure how the roads will align and is reluctant to grant a severance until such time as the determination can be made.

[133] Mr. Menard wrote to Mr. Guilbeault asking for the status of the severance application with a deadline for response of April 29, 2016 and stated that he was not willing to extend past that date and otherwise the agreement would be considered at an end.

[134] Mr. Guilbeault responded indicating that the severance process was underway.

[135] In the Menard affidavit, (Ex M) Mr. Quesnel’s correspondence states that it “does not make sense delay – we will take over the severance January 31, 2017. United counties of p/r and township of Russell cannot wait for water and sewer extension as not part of the APS." The defendants offered to take over the severance process.

[136] In the respondent, (Ex N) Mr. Michel Hebert’s letter of February 14, 2017 (plaintiffs’ counsel at the time) refers to his previous letter of February 23, 2016, blames the municipality’s procrastination on how the roads would be situated.

[137] On April 4, 2017, Mr. Hebert’s letter suggests that Mr. Menard told the planning department that the deal was off and this allegation is repeated in his letter of May 19, 2017 from Mr. Rivet at J.L. Richards.

[138] On June 1, 2017, Mathieu Quesnel contacts Mr. Hebert, stating that they will contact Dominque Tremblay to allow the severance application to be filed but it must be filed within 14 days otherwise, it will be considered that his client is no longer interested in proceeding with the APS and requesting that his client proceed with diligence.

[139] Mr. Menard is then advised by the municipality that the severance application had lapsed due to inaction.

[140] Mr. Menard writes to Mr. Guilbeault that he must proceed with the severance application within 14 days or he will consider the APS repudiated.

[141] Mr. Sylvain Boudreault, Planner of UCPR accepted the severance application on June 12, 2017.

[142] UCPR responds to the application by requesting confirmation that Mr. Menard is the principal of Cyndric, the owner of the property.

[143] The letter also mentions that the affected lot is comprised of:

• Fish habitat;
• Organic soil;
• Mineral reserve (sand-gravel resource);
• Wellhead protection area; and
• Major collector (county road)

[144] The UCPR recommended a Planning Rational Report and inquired as to what type of commercial use was anticipated for the severed lot and the retained lot.

[145] Given that only 50 of the 80 acres (designated as industrial) was being severed, the UCPR requested a plan for an internal service road that could be built after the severance. UCPR wanted to know how the owners could ensure that the remaining 30 acres of industrial land was not going to be landlocked.

[146] On August 22, 2017, Sylvain Boudreault, Junior Planner with the municipality wrote to Marc Rivet at J.L. Richards attaching the following document: Recommended Road allowance as per UCPR, PDF, Recommended Roundabout Allowance as per UCPR (exact quote is provided):

Bonjour Marc,

Essentiellement, nous désirons obtenir un rapport d’urbanisme en support à la demande d’autorisation que va analyser les aspects du terrain affecté par le Plan officiel en plus de considérer l’intersection de St-Guillaume et l’emprise de chemin ébaucher proposée qui se raccorde jusqu’au chemin St-Pierre (voir plans ci-joint). Une vision à long terme est mise pour justifier une division de terrain à cet endroit.

[147] Marc Rivet’s response was on August 22, 2017, to Mr. Boudreault. Jeremie Bouchard from UCPR and Mr. Guilbeault were copied (exact quote is provided):

Salut Sylvain,

Merci

Tu étais pour parler avec Jéremie pour voir ce qui étais le plan pour ce terrain et la meilleure approche pour aller de l’avant avec le morcellement de terrain. Laisse-moi savoir ce que vous pensez serait la meilleur stratégie/approche.

[148] The whole chain is not provided but the future plans for the property and the proposed road were being discussed.

[149] A survey plan sketch dated March 23, 2017, prepared by Annis et al. attached to Mr. Guilbeault’s affidavit shows a red line on it but there is no indication who drew the line.

[150] There is no real evidence that this plan was submitted to the UCPR and was considered by it. There is no real evidence that the plan required by UCPR was tendered to them.

[151] In the fall of 2017, counsel for the parties communicated regarding the status of the severance process:

• On November 6, 2017, Mr. Menard’s counsel inquires with the plaintiff and states that the matter must proceed or else the contract will be terminated;
• On November 6, 2017, Mr. Guilbeault responds and states that he is waiting for Mr. Menard’s confirmation that he can bind Cyndric; He also confirms that the fish habitat study has been paid for and they have retained J.L. Richards and Associates (engineers) on the traffic issue; and
• Mr. Guilbeault repeats his request for Menard’s authority to bind Cyndric.

[152] On November 7, 2017, Mr. Guilbeault states that the fish habitat study cannot be completed until the spring of 2018.

[153] On March 12, 2018, Mr. Guilbeault is advised that Mr. Menard is no longer waiting and on April 6, 2018 confirms that he considers the APS repudiated by Mr. Guilbeault.

[154] In a letter dated January 10, 2019, the Plaintiff’s lawyer, Mr. Hebert, inquired with Mr. Boudreault: for timelines, what is necessary to complete the severance application and possible conditions that would be imposed on the severance.

[155] In a response dated January, 22 2019, Mr. Boudreault wrote:

1. The timeframe for completion of consent is typically set for 90 days from the day the application is filed until the final decision of the Consent Authority.

2. The items listed in our July 16, 2017 letter are still required to deem the application as complete.

3. We cannot provide comments at this time.

[156] Therefore, UCPR had not received the requirements set out its letter of July 6, 2017 from the plaintiffs.

Conclusion

[157] The above chronology demonstrates a pattern of delay and what can be characterized as a consistent disregard for a fundamental term of the agreement, that is, to move towards a severance in order for the transfer of the 50 acres to proceed. The defendants repeatedly requested the status of the severance application and extended deadlines for a closing date.

[158] 677 failed to complete the severance process in the four years since the APS took place.

[159] Taken cumulatively, 677’s actions demonstrate that it was not proceeding with the severance application in a timely manner:

• Did not pay the $5,000 required for the vendor to commence the application in the original terms of the contract;
• Waited 9 months before applying for a severance after the renegotiation of the APS;
• Allowed the first severance application to lapse with the municipality;
• Did not move forward with the requirements set out in the municipality’s letter of July 6, 2017;
• Delayed in completing the fish habitat study;
• Insisted on doing the severance even though the vendor offered to take over;
• Did not provide the municipality with a plan showing the proposed road location; and
• Admitted to waiting for the municipality to agree to service water and sewer to the 50 acres even though this is not a term of the APS and not necessary for a severance to take place.

[160] This conduct shows a pattern of not moving in a timely fashion when the APS clearly stated that time was of the essence. The original timelines in the APS anticipated that the severance process would take approximately 90 days which was confirmed by Mr. Boudreault from the municipality.

[161] I have considered the five factors set out in Spirent:

(1) the ratio of the party's obligations not performed to that party's obligations as a whole:

The severance process was fundamental to the closing occurring;

(2) the seriousness of the breach to the innocent party;

Failure to proceed expeditiously with the severance deprived the defendants of the use of the property;

(3) the likelihood of repetition of such breach;

As stated, there had been a pattern of delay in moving forward with the severance;

(4) the seriousness of the consequences of the breach;

The severance was a fundamental term of the APS; and

(5) the relationship of the part of the obligation performed to the whole obligation:

Without a severance, the APS could not be completed.

[162] There is a reference to a previous purchaser in 2005 who had spent considerable amount of funds to obtain a severance but did not proceed because the members of the council of the municipality were not in favour of him and his project, and the defendants were unwilling to contribute to his costs. The court was provided with some details but does not have the full record of the transaction and finds that this failed purchase has little relevance to the case before me.

[163] The plaintiff says that the severance application was complicated. He has not provided evidence to indicate that Mr. Boudreault’s time estimate is inaccurate. He has not shown that the requirements of the municipality set out in July 6, 2017 (which is 3 years after the original date of the APS) would take an immense amount of time.

[164] The plaintiff also argues that the defendant was not cooperative in providing proof that Mr. Menard could bind Cyndric. This was suggested by Marc Rivet, a planner with J.L. Richards & Assoc. Ltd. in an email dated July 24, 2017, to Mr. Guilbeault.

[165] There is no confirmatory evidence that this caused delay in the severance process. At the time, he requested this authorization in the summer 2017, he shortly thereafter admitted that the fish habitat study would not be completed until the spring 2018.

[166] There is no independent evidence from the municipality that Mr. Menard told it that the “deal was off”. Rather, Mr. Menard’s affidavit regarding communications with the municipality are set out in the affidavit dated April 11, 2022, at paragraph 19 where Mr. Menard states that he was complaining to the municipality about how long things were taking.

[167] Even if Mr. Menard had communicated that the “deal was off” to the municipality, he soon confirmed shortly thereafter that he was approving the severance process. This alleged statement, if true, would have contributed to the delay for 2 months (April and May 2017). In the scheme of things, this is a minor delay.

[168] The only real evidence of concrete and serious steps involving an expenditure is a $1600 deposit for the fish habitat study.

[169] The defendant was subsequently able to obtain severance of 80 acres in a much speedier fashion as the full 80 acres was considered industrial and remaining acreage was farming. There was no need for fish habitat or soil studies. The court finds that the defendant’s application for severance after the APS was terminated by him was not the same severance application that was required by the plaintiffs. The defendants admit that their severance consisted of all 80 acres that was zoned industrial and hence UCPR did not require studies (as outlined in its letter dated July 6, 2017) as all the industrial land was being severed as opposed to the 50 acres in the original APS.

[170] Also, UCPR required a plan for the road filed with the severance application. It did not want the remaining 30 acres that was zoned industrial to have no road access. See the Menard Transcript Q 120.

[171] Even though the severance application had more requirements, the plaintiff dragged his feet. On a motion for summary judgment, the responding party must put its best foot forward as the record shows numerous communications outlining the steps (or lack of efforts) to obtain a severance.

[172] He did not move forward after receiving the July 6, 2017, letter from the municipality. In fact, in response to his counsel’s letter, the municipality responded in January 2019 that nothing in the letter dated July 2017 had been addressed including the fish habitat, soil and road plan studies.

[173] On March 31, 2015, he waived the condition that the property was “developmentally ready” as he was satisfied at that time an arrangement could be worked out with UCPR.

[174] Mr. Guilbeault says it was not until 2017 that there was reasonable clarity regarding the roadway and servicing and that Mr. Menard was aware of this.

[175] Mr. Guilbeault says that the municipality had all that was required for the severance application and just needed to process it with the payment - they had his credit card information and could have processed the payment. This is not borne out by the evidence as he had not completed the requirements of UCPR set out in its letter of July 6, 2017.

[176] He claims he expended $250,000 to solve the problems of roadways and servicing, and undertaking the studies but no real evidence has been provided.

[177] There is evidence that he hired Marc Rivet, a planner with J.L. Richards & Associates, to deal with the roadway and planning issues. He states that Mr. Rivet provided a preliminary road design after numerous drafts and the municipality was agreeable to the roadway within the area that he was buying. No real evidence has been provided of these drafts.

[178] He says he hired Janet Bradley, a planning lawyer, but provided no details of what services she provided and no real evidence from her regarding her involvement.

[179] Based on the extensive record before the court, the court finds that there is no genuine issue for trial.

[180] In Hryniak, the Supreme Court at para. 57, stated that the documentary record is often “sufficient to resolve material issues fairly and justly”.

[181] The court can weigh the evidence, draw inferences and evaluate credibility on the record. There is no need for viva voce evidence as the court is able to assess credibility and reliability. The record is clear that there was an exorbitant delay in moving the severance application forward. The parties anticipated that it would take just over 3 months in the original APS and Mr. Boudreault from UCPR confirmed that this was a reasonable time frame. Instead, after almost four years there was no indication that a severance was forthcoming.

[182] The defendants have met their evidentiary burden of demonstrating that there is no genuine issue requiring a trial. The plaintiffs have not met their onus to show that their claim has a reasonable chance of success and that there are genuine issues requiring a trial.

[183] The plaintiffs have fallen short of providing evidence that supports their position of the causes for the delay and that they were moving expeditiously towards obtaining a severance.

[184] This amounts to an anticipatory breach of a fundamental term of the APS to the point that a reasonable person would conclude that he had repudiated the contract.

[185] The sale could not proceed without the severance.

[186] Mr. Menard was present for some of the meetings with the municipality. He would be aware of some of the discussions. Regardless of his attendance, Mr. Guilbeault was responsible to proceed with the severance. Mr. Menard’s lawyer wrote to Mr. Guilbeault on numerous occasions complaining of the delay.

[187] The fact that the defendants registered a mortgage and did not immediately provide proof that he could bind Cyndric does not diminish the plaintiff's responsibility to proceed with the severance in a reasonable period of time. In my view, the use of the words “innocent party” used in the case law dealing with anticipatory breach does not equate to a party with “clean hands” used when someone is requesting an equitable remedy.

[188] The court is confident that it can, in the interests of justice, render a summary judgment in this matter and that fairness will be seen to be done. As stated in Hryniak “the standard for fairness is not whether the procedure is as exhaustive as a trial, but whether it gives the judge confidence that she can find the necessary facts and apply the relevant legal principles so as to resolve the dispute”.

[189] The importance of timing was repeatedly communicated to 677.

[190] Mr. Guilbeault, on behalf of 677, was dragging his feet as he also indicated that he was waiting to see if the municipality would provide water/sewer service to the 50 acres. This was not a condition or term of the APS and does not provide the plaintiff with a reasonable excuse for the delay. A hook up service for water/sewer was not necessary for a severance application.

[191] At the time of this hearing, this property was still zoned as unserviced industrial land.

[192] Certainly, if the plaintiff’s plan was to have the 50 acres developed into fully serviced property, he should have made it part of the APS. Clause 16 of the APS confirms that the written agreement comprised all of the terms of the APS and there were no other terms or collateral warranties.

[193] Furthermore, in March 2015, the plaintiff waived the condition in the APS and confirmed that the property was suitable for its intended development.

[194] Since 677 formally waived the condition, the APS theoretically became final and binding but by virtue of the term of the contract and s. 53(17) of the Planning Act, the transaction could not take place until the municipality consented to sever the 50 acres.

[195] Certainty and precision are important when dealing with business and commerce.

[196] It would be a reasonable interpretation of the contract that the APS for industrial development property did not give the plaintiffs an open-ended time frame to complete the severance application thereby causing an indefinite postponement of the closing date.

[197] Relying on the principles set out in Sattva Capital Corp. v. Creston Pharmaceuticals Inc., 2014 SCC 53 and reviewing the clauses in the APS, the court notes a 4-month window for the severance application had been included in the APS and confirmed by the municipality and “time of the essence” indicate that the common objective of the parties was to procced with the severance application and closing in a timely manner.

[198] In their factum, the plaintiffs pin the blame on UCPR regarding the roadway. The evidence indicates that UPCR wanted a plan with the proposed roadway submitted by plaintiffs. He also blames the Township as they had not decided whether they would service the site.

[199] The court can infer that Mr. Guilbeault wanted the servicing in order to allow him to develop the land or increase the value of the land.

[200] Servicing of the site was not a necessary component of the severance and not a term of the APS.

[201] If Mr. Guilbeault wanted municipal servicing to the 50 acres, then the APS would still not be completed 9 years after the signing of the APS, as servicing is still not available on this property.

[202] As is clear from the case law, summary judgments can deal with equitable relief.

[203] With respect to specific performance, the plaintiffs have not demonstrated that they were ready, willing and able to close. Mr. Guilbeault refused to answer questions pertaining to his finances to determine if he had the funds to close the deal. In addition, as discussed above, there is no uniqueness to the 50 acres.

[204] Summary judgment is granted dismissing the plaintiffs’ claim.

Costs

[205] The court has received bills of costs from the parties. The parties are encouraged to resolve the issue of costs. If they are unable to do so, then the defendants shall file its 2-page costs submissions along with any offers to settle by August 25, 2023. The plaintiffs shall file its 2-page costs submissions along with any offers to settle by September 8, 2023. The defendants may file a one-page reply by September 15, 2023.

Justice A. Doyle Date: August 10, 2023