The tenant unilaterally repudiated a commercial lease and vacated the premises.
The landlord refused to accept the repudiation, kept the lease alive, and sued for rent arrears without taking steps to mitigate by re-letting the premises.
The tenant argued that the Supreme Court of Canada's precedent in Highway Properties, which allows a landlord to insist on performance without mitigating, should be overturned in light of modern contract law principles.
The court held it was bound by vertical stare decisis to follow Highway Properties and the Ontario Court of Appeal's subsequent affirmations of the rule.
The court also rejected the tenant's argument that the lease capped damages at two years' rent, finding the cap only applied if the landlord terminated the lease.
Summary judgment was granted to the landlord for rent arrears.