Part Two – Timing is Everything in Real Estate Agreements of Purchase and Sale

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Appeals, Business Litigation, Civil Litigation, Commercial, Commercial and Contract Litigation, Commercial Contracts, Commercial Litigation, Contract Disputes, Contract Termination, Injunction & Specific Performance, Real Estate | Developers, Real Estate Litigation, Specific Performance, Summary Judgment0 Comments

I had written a previous blog on the “time is of the essence” clause in real estate agreements where it was discussed that the strict adherence to any agreed upon time limits was generally the case. A recent Ontario Court of Appeal case, Fortress Carlyle Peter St. Inc. v. Ricki’s Construction and Painting Inc., serves as a reminder that the “time is of the essence” clause is not absolute and unfettered, and there are preconditions that must be satisfied for a party to rely upon and insist on time being of the essence. The facts are not overly complicated in this case.  The respondent was a condominium developer in the process of acquiring properties for a proposed project in downtown Toronto.  The developer entered into an Agreement of Purchase and Sale (“APS”) with the vendor to acquire the subject property.  Although the APS required the vendor to provide estoppel certificates five days prior … Read More

Gilbertson Davis LLP Successfully Defends Against Appeal of Decision Enforcing Liquidated Damages in Settlement Contract

Andrew Ottaway, B.A. (Hons.), LL.B.Appeals, Appellate Advocacy, Business Litigation, Civil Litigation, Commercial and Contract Litigation, Contract Disputes, Fraud, Fraudulent Schemes, Gilbertson Davis LLP News, Investment Fraud, Summary Judgment0 Comments

In Haas v. Viscardi, 2019 ONCA 133, Andrew Ottaway of Gilbertson Davis LLP assisted the plaintiff in securing his settlement agreement with a defendant (in an earlier investment fraud litigation) with a liquidated damages clause.  Specifically, the defendant was required to pay $60,000 if he failed to make prompt payments under the subject settlement agreement. The defendant, after defaulting, refused to honour the liquidated damages clause.  However, on the plaintiff’s motion for summary judgment, the motion judge upheld the liquidated damages clause and granted judgment.  Our blog post on the motion decision can be found here. On appeal, in Haas v. Viscardi, 2019 ONCA 133, the Court of Appeal rejected the defendant’s argument that the liquidated damages clause was an unenforceable penalty clause, and upheld the motion judge’s decision granting summary judgment.  The Court of Appeal also enforced the provision in the settlement agreement requiring that the defendant pay the plaintiff’s … Read More

Summary Judgment Motion Publication: Sentinels of the Hryniak Culture Shift: Four Years On

John L. Davis, B.A. (Hons.), J.D.Appeals, Appellate Advocacy, Civil Liability, Commercial Litigation, Fraud Recovery, Gilbertson Davis LLP News, Summary Judgment0 Comments

David Alderson, Senior Counsel-Commercial Litigation at Gilbertson Davis LLP, is the author of the chapter entitled Sentinels of the Hryniak Culture Shift: Four Years On, included in the Annual Review of Civil Litigation 2018 , (Ed. by the Honourable Justice Todd L. Archibald, published by Thomson Reuters Canada Limited) a copy of which can be accessed here, and which contains the following in the Overview: “Mr. Alderson has done a masterful job in reviewing the post-Hryniak judgment landscape. He canvasses whether or not our courts have embraced the advocated Hryniak culture shift in civil litigation through the simplification of pre-trial procedures and the principle of proportionality. Before embarking upon a summary judgment motion, all counsel should carefully read Mr. Alderson’s paper because it provides superb guidance concerning the prospects of success not only before the motions judge but on appellate review. Mr. Alderson’s paper is a comprehensive tour de force for all advocates.” –  The Hon. Justice Todd Archibald, Ontario Superior Court of … Read More

Real Estate Litigation: Failure to Give Extension of Closing Date is not Bad Faith

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Certificate of Pending Litigation, Civil Litigation, Commercial and Contract Litigation, Contract Disputes, Contract Termination, Real Estate | Developers, Real Estate Agent and Broker, Real Estate Litigation, Specific Performance, Summary Judgment0 Comments

The recent summary judgment motion decision in Time Development Group Inc. v. Bitton, 2018 ONSC 4384, involves a situation that arises quite often in failed closings of real estate transactions.  One of the main causes for an aborted real estate transaction is the failure of the purchaser to obtain the required financing to close on the transaction, possibly influenced by the Ontario Fair Housing Plan and the new mortgage lending rules. In this case,  the plaintiff entered into an agreement to purchase three adjoining properties for a residential home redevelopment project.  There were a series of amendments to the agreement with the terms as follows: (a) purchase price of $10.55 million; (b) deposit of $500,000; (c) two vendor take back mortgages; and (d) closing date of July 31, 2017.  The plaintiff had secured a commitment letter to finance the transaction, however, six days before the closing date, the plaintiff was dismayed to find out that their financing had been withdrawn because the market conditions had changed.  … Read More

Dominican Republic Vacation Claim Examined in Di Gregorio v. Sunwing Vacations Inc.

Janice Perri, B.A. (Summa Cum Laude)Appeals, Appellate Advocacy, Civil Litigation, Commercial Contracts, Contract Disputes, Cross-Border Litigation, Jurisdictional Challenges, Negligence, Summary Judgment, Travel & Tour Operators, Travel & Tourism0 Comments

In Di Gregorio v. Sunwing Vacations Inc., the appellants purchased a vacation package to attend the Dreams Punta Cana Resort and Spa through their travel agent, Sunwing Vacations Inc. (“Sunwing”). While on vacation, the balcony railing gave way resulting in the appellants sustaining injuries. The motion judge was found to have erred in not conducting a jurisdictional analysis pursuant to Club Resorts Ltd. v. Van Breda. The Court of Appeal stated that the relevant connecting factor is that the claim pleaded was based on an Ontario contract. The alleged tortfeasors do not need to be party to the contract, as all that is required is that a “defendant’s conduct brings it within the scope of the contractual relationship and that the events that give rise to the claim flow from the contractual relationship” as stated in Lapointe Rosenstein Marchand Melancon LLP v. Cassels Brock & Blackwell LLP. The Court of … Read More

A Successful Constructive Dismissal Claim in Hagholm v. Coerio Inc.

Janice Perri, B.A. (Summa Cum Laude)Appeals, Appellate Advocacy, Civil Litigation, Contract Disputes, Contract Termination, Employment, Employment & Wrongful Dismissal, Summary Judgment, Wrongful Dismissal0 Comments

Constructive dismissal occurs when an employee is indirectly and effectively dismissed from the position or terms he/she had previously agreed formed the employment. Without the consent of the employee, a substantial alteration is presented that fundamentally changes the terms of the agreed upon contract. Hagholm v. Coerio Inc. represents a successful claim for constructive dismissal. The respondent had entered into her employment on the understanding that she could work from home three days a week. When this condition was changed, the respondent claimed constructive dismissal and ceased coming to work. The Motion Judge, on a motion for summary judgment, found that there was constructive dismissal because this was an essential term and the appellant arbitrarily withheld a bonus from the respondent. The Court of Appeal also confirmed that the respondent was not required to mitigate her damages for the appellant’s breach of contract in these circumstances. Also in this case, the … Read More

An Illegal By-Law in Perelli v. The Town Corporation of Richmond Hill

Janice Perri, B.A. (Summa Cum Laude)Civil Litigation, Contract Disputes, Employment, Summary Judgment0 Comments

Matthew Stroh represented the plaintiff in Perelli v. The Corporation of the Town of Richmond Hill, 2017 ONSC 6062, who was successful on a motion for summary judgment declaring that The Corporation of the Town of Richmond Hill (“the Town”) By-Law 135-14 is illegal. From December 1, 2010 to November 30, 2014, the plaintiff was employed as an elected municipal councillor for Ward 2 of the Town. Upon the completion of his term, the plaintiff was entitled to severance pay, but only received a deducted amount due to the Town By-Law 135-14 (“the By-Law”) that authorized said deduction. The deduction represents the amount charged in postage by the plaintiff to the Town’s corporate account in conducting a survey. Justice Sutherland of the Ontario Superior Court of Justice found the By-Law to be invalid due to lack of statutory authority and void for bad faith. The By-Law was enacted without the plaintiff … Read More

Court Considers Jurisdiction in Context of Online Sales

Andrew Ottaway, B.A. (Hons.), LL.B.Business Litigation, Civil Litigation, Cross-Border Litigation, Enforcement of Foreign Judgments, Information Technology, Injunction & Specific Performance, Intellectual Property, Internet | Technology, Jurisdictional Challenges, Of Interest to US Counsel, Summary Judgment0 Comments

In Dish v. Shava, 2018 ONSC 2867 (CanLII), plaintiffs obtained judgment in Virginia, including an injunction, against the defendants, who were located in Ontario.  The plaintiffs then brought an action in Ontario seeking recognition and enforcement of the Virginia judgment and injunction in Ontario. On the motion for summary judgment, the Ontario Court considered whether the Virginia Court had exercised jurisdiction based on the Ontario test for jurisdiction: i.e. whether the defendants had a real and substantial connection with Virginia. The defendants owned and operated an interactive, commercial website through which users purchased TV set-top boxes.  The Ontario Court found that the defendants had a real substantial connection to Virginia based on the nature of the business they were operating, specifically: users in Virginia purchased the TV set-top boxes from the defendants’ website.  At least 193 customers with a Virginia shipping address purchased Shava TV product from the Defendants’ distributor … Read More

When is Oral Evidence Required to Resolve Credibility Issues in Summary Judgment Motions?

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Appeals, Business Litigation, Civil Litigation, Commercial, Commercial and Contract Litigation, Commercial Contracts, Commercial Litigation, Contract Disputes, Contract Termination, Franchise | Licensing, Franchise Law, Summary Judgment0 Comments

The Ontario Court of Appeal decision in 2212886 Ontario Inc. v. Obsidian Group Inc., 2018 ONCA 670, involved the appeal of a partial summary judgment decision in a dispute between the franchisor and a franchisee of Crabby Joe’s Tap and Grill.  In this case, the franchisee operated a Crabby Joe’s franchise for a year and a half prior to serving a notice of rescission of the franchise agreement on the franchisor. Claims The franchisee claimed that the disclosure document provided was materially deficient and it was entitled to rescind the franchise agreement within two years of execution of the franchise agreement under section 6(2) of the Arthur Wishart Act (Franchise Disclousre), 2000 (“the Act”).   The franchisee claimed for rescission damages under section 6(6) of the Act and also damages for breach of contract and breach of the fair dealing obligations under the Act.  In response, the franchisor brought a counterclaim for a declaration that the franchise agreement was validly terminated and a … Read More

Gilbertson Davis LLP Enforces Liquidated Damages Clause in Settlement Agreement by Summary Judgment

Andrew Ottaway, B.A. (Hons.), LL.B.Business Litigation, Business Torts | Economic Torts, Civil Litigation, Commercial and Contract Litigation, Contract Disputes, Fraud, Fraud Recovery, Fraudulent Schemes, Shareholder Disputes, Summary Judgment0 Comments

In Haas v. Viscardi, 2018 ONSC 2883 (CanLII) the plaintiff settled a claim of $200,000 based on fraudulent misrepresentation with three defendants. The settlement agreement provided for various payments by the defendants on specified dates.  The settlement agreement required Viscardi to make payments of $30,000 in three installments. If Viscardi failed to make the payments on the dates provided, the settlement agreement provided that Viscardi would consent to judgment for $60,000 (the “Consent Judgment Clause”). Viscardi made one payment of $10,000, but failed to make the remaining two payments, in breach of the settlement agreement.  He then refused to consent to judgment. The plaintiff commenced a claim to enforce the settlement agreement, and brought a motion for summary judgment. The motion judge rejected Viscardi’s argument that the Consent Judgment Clause was an unenforceable penalty clause.  The judge considered the test for whether a liquidated damages clause is an unenforceable penalty: … Read More

Court Considers Oppression Claim by Creditors against Directors

Andrew Ottaway, B.A. (Hons.), LL.B.Business Law, Business Litigation, Civil Litigation, Directors' and Officers' Liability, Oppression Remedies, Summary Judgment0 Comments

In The Investment Administration Solutions Inc. v. Pro-Financial Asset Management Inc., 2018 ONSC 1220 (CanLII), the Ontario Superior Court considered an oppression claim under section 248 of the Ontario Business Corporations Act by a creditor against the directors of a debtor company. The Plaintiff company provided back office services to the Defendant Pro-Financial. Pro-Financial was an Ontario Corporation which carried on business as an investment dealer.   Pro-Financial was poorly managed and did not comply with the applicable regulatory requirements.  Pro-Financial’s assets were eventually sold to another dealer at the insistence of the Ontario Securities Commission (“OSC”). As a result of the sale, there was no money left to pay the Plaintiff’s significant outstanding accounts. The Plaintiff brought an action against, among others, directors of Pro-Financial.  The Plaintiff’s claim included a claim for an oppression remedy.  The Plaintiff argued that the directors of Pro-Financial had violated Pro-Financial’s reasonable expectation that the … Read More

Court of Appeal Confirms Importance of Requisitions in Real Estate Transactions

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Appeals, Commercial, Commercial and Contract Litigation, Commercial Contracts, Commercial Litigation, Contract Disputes, Contract Termination, Real Estate Litigation, Summary Judgment0 Comments

The Court of Appeal of Ontario decision in 1418885 Ontario Ltd. v. 2193139 Ontario Limited, 2018 ONCA 54, recently overturned a summary judgment motion decision which confirmed the importance of requisition letters in real estate transactions. In this case, the parties had entered into an Agreement of Purchase and Sale for a property with a restaurant, golf course, 12 residential apartments, a two-storey home and a banquet hall.  The Agreement of Purchase and Sale included the following requisition clause:    8.  TITLE SEARCH:  Buyer shall be allowed until 6:00 p.m. on the 30th day of May, 2016 (Requisition Date) to examine the title to the property at his own expense and until the earlier of: (i) thirty days from the later of the Requisition Date or the date on which the conditions in this Agreement are fulfilled or otherwise waived or, (ii) five days prior to completion, to satisfy himself that there are … Read More

Ontario Court Decides on Appropriate Use of Mini-Trial in Summary Judgment Motions

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Civil Litigation, Commercial, Contract Disputes, Misrepresentation, Negligence, Professional Liability, Real Estate Agent and Broker, Real Estate Litigation, Summary Judgment0 Comments

In Crisafi v. Urban Landmark Realty Inc., 2018 ONSC 191, the Ontario Superior Court of Justice addressed a summary judgment motion brought in a real estate litigation matter and provided guidance on when the Court will use its enhanced fact-finding powers set out in the 2010 amendments. Background This case involved a claim by a real estate agent against his former real estate brokerage for unpaid real estate commissions in the amount of $60,000.  The brokerage took the position that the agent breached his contractual, statutory and fiduciary duties to its clients and was negligent in handling four transactions which caused it to suffer damages. The brokerage argued that the agent failed to properly advise one of its clients while in a multiple representation situation including the anticipated sale price of the house and an estimate of whether the client could afford to purchase a subsequent property.  The house ended up sitting on the market even after several reductions in the listing price.  As is commonplace in the industry, this resulted in … Read More

Court of Appeal Confirms Strict Notice Requirements in the Termination of Commercial Leases

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Appeals, Commercial, Commercial Leasing, Contract Disputes, Summary Judgment0 Comments

The Ontario Court of Appeal in Jay-Pee Drycleaners Inc. v. 2321324 Ontario Inc., 2017 ONCA 798, recently overturned a summary judgment motion decision involving the termination of a commercial lease agreement. In this case, the tenant had operated a dry cleaning business for 12 years before the lease was converted into a month-to-month tenancy.   After the new landlord purchased the property and was assigned the lease, it demanded the tenant provide evidence that it had successfully completed a course related to the management of dry cleaning contaminants and waste.  Even though the tenant advised that the Ministry of Environment had deemed the course to be unnecessary and the course was not available until the following year, the new landlord terminated the lease and retained a bailiff to re-enter and re-possess the premises. The tenant brought an action for damages arising from the unlawful termination of the lease.  The new landlord responded with a counterclaim and brought a summary judgment motion. The … Read More

Use At Your Own Risk: Partial Summary Judgment Motions

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Appeals, Business Litigation, Civil Litigation, Commercial, Franchise Law, Misrepresentation, Negligence, Summary Judgment0 Comments

The Ontario Court of Appeal in Butera v. Chown, Cairns LLP, 2017 ONCA 783, recently overturned an award of partial summary judgment in a professional negligence action and provided guidance on the appropriate circumstances in which partial summary judgment motions should be brought. In the original action, the plaintiffs brought an action against various Mitsubishi companies after their Mitsubishi dealership franchise failed, claiming damages for breach of contract, misrepresentation, negligence and breaches of the Arthur Wishart Act.  The original action was dismissed on summary judgment because the applicable two-year limitation period had passed.  The plaintiffs were also ordered to pay $150,000 in costs for both the action and the summary judgment motion. The plaintiffs appealed the summary judgment motion decision and argued that a six-year limitation period was applicable notwithstanding that they had conceded at the motion that the applicable limitation period was two years.  The appeal was dismissed. The plaintiffs then brought the subject action against their former lawyers for negligence.  The plaintiffs claimed damages for … Read More

Summary Judgment Granted in Multiple Proceedings Surrounding Enforcement of Italian Judgment

Bianca Thomas, B.Sc.(Hons.), J.D.Business Litigation, Commercial, Commercial Litigation, Cross-Border Litigation, Enforcement of Foreign Judgments, Jurisdictional Challenges, Summary Judgment0 Comments

The case of King v Lang Michener, 2017 ONSC 1917 (one of three related actions), began with a transaction that went awry. The Plaintiff, Gregory King, a lawyer at Aylesworth and later Gowling Lafleur Henderson LLP, acted in a transaction relating to a new hotel in China with an Italian company, Sincies Chiementin SpA (“Sincies”), and various other foreign individuals and businesses. Mr. King received a 5% interest in the hotel, and Aylesworth was to receive payment for legal fees. Sincies went bankrupt, and one of its assets, a $600,000.00 USD deposit, vanished. Sincies’ trustee in bankruptcy eventually sued Mr. King, among others, in Italy, to try to recover the money. Mr. King did not defend the Italian proceedings. The Italian court ruled against him, and ordered him to pay the deposit. Mr. King did not pay the judgment on the grounds that the Italian court lacked jurisdiction. Sincies’ trustee then … Read More

Insurance Coverage For Cyber Crime: The Brick v. Chubb

Robert Kalanda, B.A. (Hons.), J.D.Cyber Fraud, Cyber Risks, Cyber Security, Fraud, Fraud Recovery, Insurance, Internet Fraud, Summary Judgment0 Comments

In the recent case of The Brick v. Chubb Insurance, the Alberta Court of Queens Bench held that the plaintiff’s commercial crime policy did not cover the money lost by the plaintiff as a result of a social engineering fraud. The plaintiff had been contacted by unknown persons pretending to be one of the plaintiff’s service providers, and requested banking information from their accounts payable department, which ultimately led to the plaintiff changing their internal records and sending of payments to the fraudsters’ own account instead of their service provider. The plaintiff sought coverage for the losses, and the insurer denied coverage. The court noted that the policy only applied to fund transfers made “without the insured’s knowledge or consent”. The plaintiff argued that they did not consent, since their actions were induced by the fraudulent correspondence. The insurer argued that the policy did not require consent to be “informed” or otherwise … Read More