COURT FILE NO.: CV-23-32392 DATE: 2024-10-11

ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

Priyesh Modi, Kamaljeet Saini and Family Tree Properties Inc. Plaintiffs

– and –

2756646 Ontario Inc., Kamal Hira, Baljit Hira, Ivan Pecarski, 2750707 Ontario Inc., Shab Holdings Ontario Inc., Amrit Hira, Nick Pecarski, Sophie Pecarski, Gordelli Management Ltd., New Haven Mortgage Corporation and The Municipality of West Perth Defendants

Counsel:

Darwin Harasym, for the Plaintiffs Rodney M. Godard and Ioana Vacaru, for the Defendant, 2756646 Ontario Inc.

HEARD: September 26, 2024

RULING ON MOTION

KALAJDZIC J.

[1] This is a motion by the defendant, 2756646 Ontario Inc., formerly Mitchell Woods Inc. (“Mitchell Woods”), to discharge five certificates of pending litigation (“CPLs”) obtained by the plaintiffs on a motion without notice with respect to nine properties in the Municipality of West Perth. The CPLs were issued pursuant to an order granted by McArthur J. on July 23, 2023 and registered on title two days later.

[2] The properties at issue in the litigation are serviced lots in a plan of subdivision known as Mitchell Woods Estates. The relevant Agreements of Purchase and Sale (“APS”) were entered into by each of the plaintiffs in January and February 2021 for the construction of homes on each lot with closing dates between May and August 2022. The total purchase price of the nine APS is $3,864,000. The plaintiffs paid deposits totaling $554,000. None of the nine homes have been built.

[3] Mitchell Woods’ position in this litigation is that the plaintiffs are not entitled to specific performance of the APS because a now bankrupt company, Hira Custom Homes Inc. (“Hira Homes”), was the vendor in each of the APS, but it was Mitchell Woods, not Hira Homes, that held title to the properties at the time of the agreements. Mitchell Woods’ main argument on this motion, therefore, is that if the APS cannot be enforced against Mitchell Woods, there is no triable issue of an interest in the properties, and the CPLs should be discharged. It also argues that the equities favour a discharge of the CPLs, principally because there is nothing unique about the properties and damages would be an appropriate remedy.

[4] The plaintiffs have pleaded that the principal of Hira Homes, Kamal Hira, was also President of Mitchell Woods at the material time and had the authority to enter into the APS as agent for Mitchell Woods. Alternatively, they argue that the APS implicitly referenced Mitchell Woods as vendor or that they have an interest in the land by way of constructive trust. On any of these grounds, they claim there is a triable issue as to their interest in the land. They submit that the equities favour maintaining the CPLs because the advantageous terms of the APS are not readily available in the market and damages would be an inadequate substitute.

[5] I find that Mitchell Woods has not met the test for discharging the CPLs under s. 103(6) of the Courts of Justice Act, R.S.O. 1990, c. C. 43 (“CJA”). The plaintiffs have a reasonable prospect of proving an interest in the properties and obtaining specific performance. Moreover, while the equities are almost evenly divided between the parties, the issue of damages tips the scale in favour of the plaintiffs.

BACKGROUND

[6] In 2020, Kamal Hira and Ivan Pecarski, a real estate broker, formed a joint venture to acquire, service, and develop 17 acres of vacant land in Mitchell, Ontario. Mr. Hira and his company, Hira Homes, would be the builder of homes on the vacant land while Mr. Pecarski would act as the sales agent for the properties. Mitchell Woods was the vehicle through which their joint venture would hold title to the subdivision lands. At the time of the execution of the APS, Mr. Hira was President of Mitchell Woods, and Mr. Pecarski was an officer and director.

[7] The plaintiffs each negotiated the terms of the APS with Mr. Hira. Priyesh Modi purchased two lots and two homes to be constructed thereon pursuant to two APS dated January 25, 2021. Kamaljeet Saini purchased one lot and a home to be constructed thereon pursuant to an APS dated February 28, 2021. Family Tree Properties Inc. (“Family Tree”), a company owned by three brothers, purchased six lots and homes to constructed thereon pursuant to six APS dated January 22, 2021. The presumptive closing dates for the APS were between May and August 2022.

[8] Mr. Modi also entered into a collateral agreement under which Hira Homes and Mitchell Woods agreed to pay 3.5 percent monthly interest on his deposits and a monthly bonus of $250 for each month his homes were used as model homes. Family Tree similarly entered into a collateral agreement with Hira Homes and Mitchell Woods that obligated the latter companies to pay a penalty of $1,250 per month for every home that was not complete by August 2022.

[9] As mentioned above, none of the homes contemplated under the plaintiffs’ APS have been constructed. No payments under the collateral agreements have been made.

[10] The APS were executed by Hira Homes “or a company associated with Hira Custom Homes Inc.” as vendor. Although Mitchell Woods was the titleholder of the properties, it was not explicitly named as a vendor in the APS. Mr. Pecarski states that he did not know about the APS at the time they were executed, that Mr. Hira did not have the authority to sell the nine properties to the plaintiffs, and that the APS do not bind Mitchell Woods. The plaintiffs claim that either Hira Homes was acting as agent for Mitchell Woods, or that Mitchell Woods was the “company associated with Hira Custom Homes” contemplated in the APS and thus contractually bound to fulfill its terms.

[11] In late 2022, the relationship between Mr. Hira and Mr. Pecarski deteriorated. Mr. Pecarski’s holding company, 2750707 Ontario Inc., purchased Hira Homes’ interest in Mitchell Woods in a share purchase transaction that closed on March 21, 2023.

[12] In April 2023, Hira Homes made a voluntary assignment in bankruptcy. It was at that time that Mr. Pecarski says he learned of the APS with the plaintiffs.

[13] The plaintiffs and others who had advanced deposits to Hira Homes filed proofs of claim in Hira Homes’ bankruptcy proceedings and are unsecured creditors. They also applied to Tarion’s deposit insurance program. Mr. Saini and Mr. Modi have recovered their deposits in full, while Family Tree has recovered $360,000 of the $400,000 paid in respect of the six properties it sought to purchase.

[14] Mitchell Woods continues to hold title to the properties in question. Unlike Hira Homes, it is not a Tarion registered builder. Counsel for the defendant emphasized this point in oral argument; the APS were agreements to buy lots and for houses to be built on the lots. According to the defendant, if Mitchell Woods is not permitted under the New Home Construction Licensing Act, 2017, S.O. 2017, c 33, Sched. 1, to build the houses, it cannot be ordered to perform the contracts.

[15] The underlying action was commenced by a notice of action on July 19, 2023, and involves claims for specific performance, damages and other relief as against the defendants. There are also crossclaims by Mitchell Woods, Mr. Pecarski, and his holding company against Mr. Hira and Mr. Hira’s wife for contribution and indemnity under their joint venture agreement, the Negligence Act, R.S.O. 1990, c. N.1, and at common law.

LAW AND ANALYSIS

[16] While the motion is complicated by the disputes between the defendants, those disputes need not be decided on this motion. The issue before the court is whether the CPLs ought to be discharged pursuant to s. 103 of the CJA and r. 42.03 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.

[17] The applicable two-part analysis is not disputed. It is set out in the oft-cited decision of Perruzza v. Spatone, 2010 ONSC 841, at para. 20. I must first determine if there is a triable issue regarding the plaintiffs’ claimed interest in the subject properties. If I am satisfied that the threshold requirement has been met, I must then consider whether the equities favour the continued registration of the CPLs. I may discharge a CPL on any ground that I consider just: 2254069 Ontario Inc. v. Kim, 2017 ONSC 5003, at para. 30.

[18] Because the CPLs were obtained on a motion without notice to the defendant, a material non-disclosure at the motion may by itself justify discharging the CPLs. Although in its notice of motion and factum the defendant argued there had been material non-disclosure, at the hearing of the motion counsel for the defendant made no submissions on this ground, and when asked by the court, he conceded the omission was not “egregious” and that there had been no intent to deceive. Consequently, I will not consider any further the allegation of a breach of the plaintiffs’ duty to make full and frank disclosure on the ex parte motion.

Issue 1: Is there a triable claim to an interest in land?

[19] The test under s. 103(6) of the CJA is whether there is an arguable claim to an interest in the subject properties. The test is not whether the plaintiffs are likely to succeed at trial: 1152939 Ontario Limited v. 2055835 Ontario Inc., [2007] O.J. No. 488 (S.C.), at para. 17. The triable issue threshold is a gateway requirement for a CPL and has been described as whether the remedy sought by the plaintiff is possible at trial: Meibodi v. Aghaiemeybodi, 2024 ONSC 340, at para. 14. The evidentiary bar is low, and the court is not to assess credibility or decide disputed issues of fact: Meibodi, at para. 15.

[20] The defendant does not dispute that agreements of purchase and sale and the payment of deposits normally create a sufficient interest in land for the purposes of s. 103(6) of the CJA. Counsel for the defendant argues, however, that the APS in question were not entered into with the titleholder of the land, Mitchell Woods. Moreover, by obtaining refunds of virtually all of their deposits from Tarion, the plaintiffs have effectively rescinded the contracts.

[21] The plaintiffs argue that there are three routes to satisfying the triable issue threshold. First, they submit that Hira Homes was the agent of Mitchell Woods for the purposes of the APS and Mitchell Woods is therefore bound by the agreements. Second, Mitchell Woods is the company contemplated in the header of the APS (“A company associated with Hira Custom Homes Inc.”). And third, an interest in the land may arise as a matter of constructive trust.

[22] I will address each of these arguments in turn.

Hira Homes Acted as Agent for Mitchell Woods

[23] First, some further background on the relationship between Hira Homes and Mitchell Woods is needed.

[24] On May 29, 2020, Hira Homes and Mr. Pecarski’s holding company entered into a Joint Venture Agreement for the purpose of buying 17 acres of vacant land. The Joint Venture Agreement set out the parties’ agreement and respective obligation in the acquisition, development, and sale of the land. On the same date, Mitchell Woods purchased the vacant land.

[25] Under the Joint Venture Agreement, the holding company and Hira Homes were the beneficial owners of the land, and Mitchell Woods acknowledged that it held title to it “as bare trustee and nominee for and on behalf of [the holding company and Hira Homes].” The Joint Venture Agreement also stipulated that neither joint venturer could sell or otherwise encumber the lands without the consent of the other.

[26] Mr. Pecarski swears in his affidavit that Hira Homes entered into the APS without his knowledge and in contravention of the Joint Venture Agreement. His evidence is disputed. For example, at his examination for discovery on July 16, 2024, Mr. Hira testified that he was “categorically sure” he told Mr. Pecarksi about these APS in his office (Joint Transcripts Brief (August 23, 2024), at pp. 31-32). While a trial judge may have to make a finding about Mr. Pecarski’s knowledge of the APS, I am not in a position to assess the credibility of either Mr. Pecarski or Mr. Hira on this motion.

[27] Regardless, the plaintiffs argue that any purported violation of the Joint Venture Agreement by Hira Homes or Mr. Hira is between the defendants. The plaintiffs are not required to ensure that internal policies and procedures are followed in order for the APS to be enforceable. I agree with this submission.

[28] An agency relationship can be created by express contract or may be implied from the conduct or situation of the parties: 1196303 Ontario Inc. v. Glen Grove Suites Inc., 2015 ONCA 580, at paras. 70-71. There is some evidence before the court that may lead to a finding of either an express or implied agency relationship:

• The lots listed in the APS are the lots contemplated by the Joint Venture Agreement.
• On cross-examination, Mr. Pecarski acknowledged that Mr. Hira generally had authority under the Joint Venture agreement to sell the lots.
• Mr. Hira was President of both Hira Homes and Mitchell Woods at the time the APS were executed.
• The plaintiffs and Mr. Hira negotiated the APS at the registered address of Mitchell Woods.
• The physical location of the lots had signs that stated “Mitchell Woods”.

[29] Taken together, there is sufficient evidence on the record to raise a triable issue regarding the plaintiffs’ interest in the land based on an agency relationship between the vendor, Hira Homes, and the titleholder, Mitchell Woods. Agreements of purchase and sale were entered into, and deposits were paid. Counsel for Mitchell Woods did not point me to any authority for the proposition that Tarion’s return of almost all the deposits paid by the plaintiffs are sufficient to expunge their interest in the land. It is at least arguable, as the plaintiffs submitted, that they were appropriately mitigating their damages, and that after-the-fact recovery of deposits through Tarion does not vitiate the APS. The facts of the case at bar are distinguishable from those in which the court finds a purchaser’s request to get deposits back from the vendor is consistent with an intention to treat the contract at an end: Chai v. Dabir, 2015 ONSC 1327, at paras. 33-35.

The APS Implicitly Incorporated Mitchell Woods

[30] The plaintiffs argue in the alternative that the APS are binding on Mitchell Woods because the language in the header implicitly contemplates the company. Each of the APS lists Hira Homes as vendor “OR (A company associated with Hira Custom Homes Inc.)”. Counsel for Mitchell Woods argues that the unnamed company in parentheses was another Tarion homebuilder affiliated with either Mr. Hira or Mr. Pecarski and could not contemplate Mitchell Woods. Whether Mr. Hira told the plaintiffs the unnamed company was Mitchell Woods or whether the plaintiffs understood that to be the case at the time they signed the APS is unclear as they gave conflicting or equivocal evidence at their cross-examinations.

[31] At his cross-examination, Mr. Hira testified that he told Akram Mohammad, a representative of Family Tree, “about the existence of Mitchell Woods and that Mitchell Woods’ role was to develop the land” (Joint Transcripts Brief (August 23, 2024), at p. 21). He was not sure if he had similarly told Mr. Saini and Mr. Modi that Mitchell Woods owned the lots (Joint Transcripts Brief (August 23, 2024), at p. 22).

[32] On the question of what was contemplated by the ‘other’ company, Mr. Modi testified that Mr. Hira told him during the negotiations that he “may have to change the name to be Mitchell Woods” (Joint Transcripts Brief (August 23, 2024), at pp. 116-17). Mr. Hira denies having said the “Mitchell Woods would complete the Agreements” (Joint Transcripts Brief (August 23, 2024), at p. 28).

[33] Mitchell Woods was a signatory to the collateral agreements, however, which lends credence to the plaintiffs’ contention that they understood both companies were involved in the transaction.

[34] On this motion, I cannot assess credibility or decide disputed issues of fact. I do not need to conclusively determine that the APS implicitly included Mitchell Woods as a vendor. Since the test on this motion is not whether the claimant will likely succeed on this argument but whether there is a triable issue as to their interest in the land, I find the low threshold has been met.

Constructive Trust

[35] A third argument put forward by the plaintiffs to establish the triable issue was that they have an interest in the land by way of a constructive trust. As the Supreme Court of Canada stated in Soulos v. Korkontzilas, at para 43:

…constructive trusts may be imposed … where there is a wrongful act but no unjust enrichment and corresponding deprivation; or where there is an unconscionable unjust enrichment in the absence of a wrongful act.

The plaintiffs submit that a constructive trust arises under both branches of the test.

[36] The defendant accepts that a constructive trust as a remedy for unjust enrichment has been held to be an interest in land capable of being protected by a CPL but argues that there has been neither an unjust enrichment nor any wrongful act to sustain the creation of a trust in the case at bar. The defendant contends that it was not unjustly enriched because it received none of the deposits, and the plaintiffs did not suffer a deprivation because most of the deposit money was returned by Tarion. Further, no constructive trust arises on the other branch of the test because Hira Homes’ voluntary assignment in bankruptcy is not a ‘wrongful act’ and Mitchell Woods itself committed no wrongful act.

[37] Family Tree was not fully indemnified by Tarion, and therefore has an argument that it was unjustly deprived of a modest sum of money. In addition, neither Family Tree nor Mr. Modi received the payments contemplated under the collateral agreements. Mr. Saini recovered his deposits and was not a party to a collateral agreement; he, therefore, does not have a prima facie unjust enrichment claim.

[38] All three plaintiffs, however, argue that they may be entitled to a constructive trust as a result of a wrongful act, namely, fraud. They allege that it is open to a trial judge to find that Mr. Pecarski and Mitchell Woods were participants, not victims, of a fraudulent scheme to obtain deposits for homes to be built on lots the defendants had no intention of building. This argument was not fully developed at the hearing of the motion and there is little evidence on the record of such a scheme. Given that I have found a triable issue arises out of the APS by way of agency or an implied term, I need not and do not make any findings with respect to the constructive trust argument.

Issue 2: Do the equities favour maintaining or discharging the CPLs?

[39] Whether or not to discharge a CPL is a discretionary decision. My discretion is to be exercised having regard to relevant factors in the circumstances of this particular case. Those relevant considerations include: (i) whether the plaintiff is a shell corporation, (ii) whether the land is unique, (iii) the intent of the parties in acquiring the land, (iv) whether there is an alternative claim for damages, (v) the ease or difficulty in calculating damages, (vi) whether damages would be a satisfactory remedy, (vii) the presence or absence of a willing purchaser, and (viii) the harm to each party from the CPL. These factors are non-exhaustive: 2254069 Ontario Inc. v. Kim, 2017 ONSC 5003, at para. 31.

[40] Mitchell Woods submits that all of the factors favour a discharge of the CPLs. While the plaintiffs agree that damages can be easily calculated (factor (v)) and that an alternative claim for damages has been pleaded (factor (iv)), they submit the remaining factors heavily favour maintaining the CPLs.

[41] While I would not characterize the remaining factors as “heavily” favouring the plaintiffs, on balance, I do find that it is just, equitable and in the interests of justice to maintain the CPLs.

Factors (i) and (iii): Shell Corporation and Intent of the Parties

[42] The shell corporation argument has no application to the individual plaintiffs, Mr. Saini and Mr. Modi. The defendant argues, however, that Family Tree is a shell corporation. Relatedly, the defendant submits that the intent of all of the plaintiffs was to buy investment property.

[43] Family Tree is owned by three brothers. Their evidence was that they formed a corporation on the advice of counsel to hold title to the properties they purchased. The company has one asset, a cottage worth $500,000, purchased in 2021. Their evidence was that the cottage is used by the brothers and other family members and, when not in use, is rented out. Family Tree files taxes and has assets. It is thus not a shell corporation.

[44] The evidence about the plaintiffs’ intent when they signed the APS is less definitive. Mr. Saini’s evidence at his cross-examination was that he was interested in downsizing and moving to the Mitchell Woods development from Brampton when he retires. Mr. Modi bought two properties and testified that in the short term, he planned to rent out the houses and then gift them to his two children. Given that his children were young at the time (both under the age of ten), the ‘short’ term plan was to generate rental income for a decade or more.

[45] The principals of Family Tree stated that they wished to buy properties close together. They stated that it is the norm in their culture for siblings and extended families to live in the same home or in proximity to one another. Indeed, the three brothers currently live in houses next to each other. However, their evidence was also that they would rent the homes out in the ‘short term’ because their children are still teenagers.

[46] At best, therefore, the plaintiffs bought the Mitchell Woods properties with mixed intent. Mr. Saini had a plan to downsize and move into the home once built; Mr. Modi’s plan to move in was remote in time, and the Family Tree brothers intended to rent for a few years before occupying the homes. This factor is thus a neutral one.

Factor (ii): Uniqueness

[47] The defendant argued that there was nothing unique about the physical property; it is, after all, vacant land with homes yet to be built on them. I agree that the traditional view of “uniqueness” expressed in the case law is of no assistance to the plaintiffs. This is not a situation where the property or its location fulfill the unique needs of a family, as was the case in Chai v. Dabir and in Cannon v. Gerrits, 2022 ONSC 851.

[48] Uniqueness, however, is not limited to what Lax J. called the “antediluvian aroma” of historic approaches to the concept: John E. Dodge Holdings Ltd. v. 805062 Ontario Ltd., at para. 53. Uniqueness also encompasses the purchaser’s subjective intentions and the circumstances underlying the transaction: Lucas v. 1858793 Ontario Inc. (Howard Park), 2021 ONCA 52, at para. 73. A property may be unique by virtue of its nature or “the features of the contract for its purchase and sale” (Lucas, at para. 71). For example, a plaintiff’s inability to secure another mortgage at a low rate has been found to satisfy the uniqueness criterion (Davis v. Khouri, 2021 ONSC 4095, at para. 67), as have the “advantageous terms” in an agreement that are not readily available in a substitute property (Lucas, at paras. 83-84).

[49] In oral argument, counsel for Mitchell Woods submitted that the “advantageous terms” argument for uniqueness did not apply on the facts of the case because of the absence of a price schedule in the APS. With no way to break down how much of the purchase price was for home construction costs as compared to the lot itself, a judge cannot conclude that the price attributable to the lot is “advantageous”.

[50] I do not find this argument compelling. The majority of the APS provided for lots and homes to be built on them in the amount of $400,000. Given the increase in the price of vacant land and housing in southwestern Ontario between 2020 and 2024, those terms, with or without abatement, would be difficult or impossible to obtain in the market today. There are two points of comparison in the evidence. The first is a house in Mitchell Woods Estates that sold in 2023 for $680,000. Another is a vacant lot that sold in the same subdivision in 2022 for $260,000.

[51] Even if the trial judge should find that the plaintiffs purchased the lots for investment purposes, courts have held that an investment property can still be unique in the sense that a substitute is not readily available, and specific performance may thus be an available remedy: 1954294 Ontario Ltd. v. Gracegreen Real Estate Development Ltd., 2017 ONSC 6369, at para. 164.

[52] On the basis that the terms of the APS were unique in the sense that they were advantageous and not readily available in the market, this factor weighs in favour of maintaining the CPLs.

Factors (iv-vi): Alternative Claim for Damages, Ease of Calculation and Adequacy

[53] The plaintiffs have made a claim for damages in their pleadings and acknowledge that it would not be difficult to calculate damages. As Corbett J. noted in Ghuman v. 1368394 Ontario Limited, [2007] O.J. No. 2737, at para. 10, however, “[t]he fate of a CPL should not depend upon counsel’s drafting choice to claim damages in the alternative.” The real question is whether it would be just to limit the plaintiffs to a remedy in damages.

[54] Mitchell Woods argued that a number of facts militate against the plaintiffs’ entitlement to specific performance. In addition to the inability of Mitchell Woods to build the homes because it is not a Tarion-registered builder and the challenge of determining an abatement in purchase price if the lots only were ordered to be conveyed, para. 34 of the APS limits the rights, remedies, and recourses of the plaintiffs to Hira Homes and explicitly not to its agents.

[55] I do not agree that an abatement would be difficult to calculate; courts are frequently called upon to do so, and importantly, expert or other evidence at trial can assist the court in this exercise. Further, whether para. 34 of the APS operates to limit the plaintiffs’ recourse to Hira Homes is a matter of contractual interpretation that is to be determined at trial, after the court’s assessment of the intention of the parties and consideration of any public policy concerns: Tercon Contractors Ltd. v. British Columbia (Transportation and Highways), 2010 SCC 4, at paras. 122-123.

[56] More pressing is the question of whether Mitchell Woods could satisfy an order of damages if one were to be made. Mitchell Woods is a bare trustee for other companies. It was incorporated to hold title to development lands. There was no evidence before the court as to how many lots remained in the Mitchell Woods subdivision or if the company owned other assets. Counsel for Mitchell Woods pointed to the share purchase price when Mr. Pecarski bought Hira Homes’ interest in the company in March 2023 as evidence of Mitchell Woods’ ability to pay damages. There is no evidence, however, about the company’s current assets or valuation as those questions were refused at Mr. Pecarski’s cross-examination. Failure to answer proper questions or to provide documentary disclosure invites an adverse inference under r. 34.15: Huntjens et al v. Obradovic, 2022 ONSC 2629, at para. 119.

[57] On a motion for a CPL, whether a defendant is in a position to pay damages and whether the plaintiff is likely to recover them is relevant to the issue of the adequacy of damages: Primont Homes (Vaughan) Inc. v. Maplequest (Vaughan) Developments Inc., 2024 ONSC 1940, at para. 132, citing UBS Securities Canada, Inc. v. Sands Brothers Canada, Ltd., 2009 ONCA 328, at para. 103 and Dhatt v. Beer, 2020 ONSC 2729, at paras. 41-47, aff’d 2021 ONCA 137, at para. 43. In the absence of evidence about Mitchell Woods’ ability to pay damages arising from the breach of the plaintiffs’ APS, the equities favour maintaining the CPLs. While a trial judge may ultimately determine that the plaintiffs are not entitled to specific performance, the test on this motion is only whether an award of damages would do justice between the parties. A defendant’s failure to provide material information regarding their means invites the court to conclude damages are not an adequate remedy: Davis v. Khouri, 2021 ONSC 4095, at para. 72.

[58] I conclude that factors (v) and (vi) weigh in favour of maintaining the CPLs.

Factor (vii): Presence of Willing Purchasers

[59] There are no active offers to purchase the subject lots. In light of the CPLs, however, it is reasonable for the defendant not to actively try and sell the property. The absence of a willing purchaser is therefore a neutral factor.

Factor (viii): The Harm to Each Party if the CPL is or is not Removed

[60] There is more of a risk of serious harm to the plaintiffs if the CPLs are removed than of harm to Mitchell Woods if the CPLs are maintained. I have already found that there is a risk that a monetary judgment would not be collectible. In addition, the plaintiffs would lose the very thing they seek in their claim, the conveyance of the properties to them. On the other hand, Mr. Pecarski was able to refinance the mortgage on the vacant land with a private lender despite the existence of the CPLs.

[61] For these reasons, I find that the equities in this case support maintaining the CPLs.

Order and Costs

[62] I dismiss the defendant’s motion to remove the CPLs issued pursuant to an order granted by McArthur J. on July 23, 2023. The plaintiffs are entitled to their costs of the motion on a partial indemnity basis. I was advised prior to releasing these reasons that the parties have agreed to the sum payable by the successful party.

Jasminka Kalajdzic Justice Released: October 11, 2024