Court File and Parties
COURT FILE NO.: CV-20-00646821-0000
DATE: 20230809
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
BURKSHIRE HOLDINGS INC.
Plaintiff
– and –
MARIAM NASRATI
Defendant
Emily Hives, for the Plaintiff
READ: August 8, 2023
papageorgiou j.
Overview
[1] The plaintiff and defendant entered into an agreement of purchase and sale (the “APS”) in respect of real property.
[2] The plaintiff was the seller and the defendant was the purchaser.
[3] The defendant failed to close and the plaintiff sued for damages.
[4] The defendant failed to defend the proceeding and was noted in default.
[5] The plaintiff brings a motion for default judgment.
Conclusion
[6] For the reasons that follow I am granting the judgment as sought in the amount of $182,852.33.
The Issues
[7] The main issues are:
• Issue 1: Do the materials provide a basis for a finding of liability?
• Issue 2: If so, what are the damages to which the plaintiff is entitled?
Analysis
Issue 1: Do the materials provide a basis for a finding of liability?
Consequences of noting in default
[8] Pursuant to r. 19.02, having not defended the proceeding, a defendant is deemed to admit the truth of all allegations of fact made in the Statement of Claim.
[9] However, pursuant to r. 19.06 a plaintiff is not entitled to judgment on a motion for judgment or at a trial merely because the facts alleged in the statement of claim are deemed to be admitted, unless the facts entitle the plaintiff to judgment.
The test on a motion for default judgment
[10] The test on a motion for default judgement was set out in Elekta Ltd. v. Rodkin, 2012 CarswellOnt 2928 (ONSC) as follows: A. What deemed admissions of fact flow from the facts pleaded in the Statement of Claim? B. Do those deemed admissions of fact entitle the plaintiff, as a matter of law to judgement on the claim? C. If they do not, has the plaintiff adduced admissible evidence which, when combined with the deemed admissions, entitle it to judgement on the pleaded claim?
[11] I am satisfied that the plaintiff has established that the defendant breached the APS based upon the following deemed admissions in the Statement of Claim:
• The plaintiff and defendant entered into the APS on February 8, 2017 (the “APS”): para 4.
• The plaintiff was ready, willing and able to close the transaction: para 8.
• However, the defendant failed to deliver the purchase price or execute and deliver the documents required to close the transaction: para 7.
Issue 2: What are the damages to which the plaintiff is entitled?
[12] The plaintiff is entitled to be compensated for the loss of its bargain which means it is entitled to be put in the same position it would have been in if the agreement of purchase and sale had closed: 100 Main Street Ltd. v. W.B. Sullivan Construction Ltd. (1978), 1978 CanLII 1630 (ON CA) at pp 22-23.
[13] The plaintiff claims a number of heads of damages all of which I award.
Difference between the sale price pursuant to the APS and the ultimate sale
[14] The plaintiff has based its damages claim on the resale price. In 100 Main Street, at para 64 Morden J. adopted the view of McGregor on Damages, 13th ed. (1972) which states that the price at which a property has ultimately sold affords good evidence of the market value. See also Briscoe-Montgomery v. Kelly, 2014 ONSC 4240, at para. 22, where the Court cited Rosenberg J. (as he then was) in Victorian (Ontario) Inc. v. DeFreitas et al., [1991] 16 R.P.R. (2d) 55 where he states, at para. 20, “…in my view, there is no better evidence to calculate the real damage suffered then the price that the plaintiff was able to obtain in the market for the resale for the home.”
[15] The purchase price pursuant to the APS was $1,559,806.30.
[16] The defendant paid various deposits over time totaling $143,947.46.
[17] After the defendant’s default, the plaintiff relisted the property and ultimately sold it for $1,265,000, which transaction closed on January 29, 2019.
[18] I am satisfied that the loss of bargain, taking into account the deposit, is $1,559,806.30-$1,265,000 - $143,947.46 = $150,858.84.
[19] There is no need to consider the issue of mitigation as the onus is on the defendant to show, if he can, that damages could have been reduced by reasonable mitigating steps: 100 Main Street at p. 23. Nevertheless, I am satisfied that the plaintiff has mitigated its damages.
Carrying costs
[20] The plaintiff incurred carrying costs between the date of closing of the APS and the ultimate sale in respect of realty taxes, charges for natural gas usage, electricity and water usage, supply and installation of an alarm, and a humidifier to secure the premises. These total $3,475.79 and are the usual types of carrying costs which courts award: 100 Main Street at p. 17, Briscoe at para 23.
[21] I am awarding these damages as reasonably foreseeable consequences of the defendant’s breach.
Commission paid to re-sell the property
[22] The plaintiff paid commission in the amount of $28,517.70. This is also a reasonably foreseeable consequence of the breach and I am awarding it.
Conclusion re damages
[23] Therefore, the damages to which the plaintiff is entitled are:
• Difference between the sale price pursuant to the APS and ultimate sale: $150,858.84;
• Carrying costs: $3,475.79; and
• Commission paid to re-sell the property: $28,517.70.
[24] These total $182,852.33.
Costs
[25] The plaintiff claims fees in the amount of $6,624.57 plus disbursements in the amount of $1,346 (inclusive of HST).
[26] I have reviewed the Bill of Costs which sets out all of the rates and hours which I find reasonable. I also find that these costs are within the reasonable contemplation of the defendant and am awarding them.
Prejudgment and post judgment interest
[27] The plaintiff has provided calculations which show that the prejudgment interest to which it is entitled based upon the date of the breach is $13,345.72 calculated at the rates in the Courts of Justice Act.
[28] The plaintiff is also entitled to post judgment interest at the Courts of Justice Act rate.
Papageorgiou
Released: August 9, 2023
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
BURKSHIRE HOLDINGS INC.
Plaintiff
– and –
MARIAM NASRATI
Defendant
REASONS FOR JUDGMENT
Papageorgiou J.
Released: August 9, 2023