Qualex-Landmark Investments Inc. v. Soroya, 2011 ABQB 354

Court of Queen ’ s Bench of Alberta Citation: Qualex-Landmark Investments Inc. v. Soroya, 2011 ABQB 354 Date: 20110527 Docket: 0901 01285 Registry: Calgary Between: Qualex-Landmark Investments Inc. Plaintiff - and - Mohammed Yuniz Soroya, Mumtaz Akhtar Soroya (A.K.A. Mumtaz Akhtar Mohammed Yunis Soroya) Shahila Samina Soroya, Samreen Soroya, Nabeel Yunis Soroya Defendants _______________________________________________________ Memorandum of Decision of the Honourable Mr. Justice R. J.

Hall _______________________________________________________ [ 1 ] This matter proceeded as a trial of two issues: one of law, and one of facts. Those issues are as follows: 1. Was proper disclosure provided by the Plaintiff to the Defendants, Soroyas in relation to the offers to purchase/agreements to purchase executed by them?

2. If the disclosure documents were not delivered to or received by the Defendants, the Soroyas, should the Soroyas nevertheless be estopped from asserting any right that they might otherwise have to rescind or terminate the purchase agreement? Factual Overview [ 2 ] At the material time, Dr. Osman Anwar was a dentist for Ms. Sydney Forman. Ms. Forman was employed by the Plaintiff Qualex-Landmark Investments Inc. (“Qualex”). She advised Dr. Anwar that Qualex was pre-selling residential condominium units in a building yet to be constructed at 12 th Avenue and 11 th Street S.W. in Calgary, called the Nova project.

She advised Dr. Anwar that a sales launch was to take place on May 27, 2006, and provided him some information with regard to what was being constructed and what was being sold. She indicated to Dr. Anwar, at the time, that sales were being limited to one unit per person. [ 3 ] Dr. Anwar was married at the time to Samreen Soroya (“Samreen”). On May 27, 2006 Dr. Anwar, Dr. Anwar’s father, and Samreen, attended at the Nova launch. Dr. Anwar had secured an appointment to allow him to attend over his lunch hour. [ 4 ] After spending some time picking out condominium units in which they were interested, Dr.

Anwar, Samreen, and Dr. Anwar’s father-in-law all met at once with Sydney Forman. They each expressed a desire to purchase units. Dr. Anwar wanted to purchase one unit in his name and his father wished to purchase a unit in his name. Samreen wished to purchase a unit in her name, and units in the names of her father (Mohammed), her mother (Mumtaz), her brother (Nabeel) and her sister (Samina). Samreen brought with her powers of attorney issued to her by her father, her mother and her brother in order to sign the offers on their behalf. [ 5 ] Dr.

Anwar’s offer to purchase was the first to be completed; whereupon Dr. Anwar left to return to work. Thereafter Samreen’s offers to purchase units for herself and her family were completed and executed by her. It is not clear when, in the order of things, Dr. Anwar’s father’s offer to purchase was executed by him, but it is not material to these reasons, as his unit purchase is not in issue. He did not appear to give evidence. [ 6 ] Ms. Forman maintains that she provided disclosure documents to Samreen in relation to all of the offers to purchase which Samreen executed at the launch on May 27, 2006.

Samreen, however, denies that she was provided any of those disclosure documents on that date or on any later date. [ 7 ] The following day, on May 28, 2006, Samreen executed the offer to purchase on behalf of her sister Samina, having now received Samina’s power of attorney authorizing her to do so. Samreen maintains that she did not receive disclosure documents from the Plaintiff in relation to that offer to purchase. [ 8 ] Finally, in August of 2006, Mohammed and Mumtaz Soroya executed an offer to purchase a further unit jointly.

Mohammed maintains that he was not provided with disclosure documents in relation to that transaction. [ 9 ] The Plaintiff maintains that disclosure documents were provided to the Defendants in relation to each offer to purchase. Whether such documents were in fact provided is the issue which I am asked to decide. In the event that I decide that disclosure documents were provided on one or more occasions, but not on all occasions, I am then asked by Counsel to determine the effect of such disclosure having been provided.

In the event that I determine that no disclosure was provided by the Plaintiff in relation to the transactions completed, I am to decide whether the Plaintiffs are estopped from maintaining a defence based upon sections 12 , 13 and 80 of the Condominium Property Act . Relevant Legislation [ 10 ] The Condominium Property Act , R.S.A. 2000, c. C-22 provides in sections 12 and 13 , the following:

12. Sale of units by developers 12(1) A developer shall not sell or agree to sell a unit or a proposed unit unless the developer has delivered to the purchaser a copy of (

a) the purchase agreement, (

b) the bylaws or proposed bylaws, (

c) any management agreement or proposed management agreement, (

d) any recreational agreement or proposed recreational agreement, (

e) the lease of the parcel, if the parcel on which the unit is located is held under a lease and the certificate of title to the unit or proposed unit has been or will be issued under

section 5(l)(b), (

f) any mortgage that affects or proposed mortgage that will affect the title to the unit or proposed unit or, in respect of that mortgage or proposed mortgage, a notice prescribed under subsection (2), and (

g) the condominium plan or proposed condominium plan. 12(2) A developer may deliver to the purchaser in respect of a mortgage or proposed mortgage a written notice stating (

a) the maximum principal amount available under the mortgage, (

b) the maximum monthly payment that may be paid under the mortgage, (

c) the amortization period, (

d) the term, (

e) the interest rate or the formula, if any, for determining the interest rate, and (

f) the prepayment privileges, if any. 12(3) Subject to subsection (4), a purchaser who purchases a residential unit pursuant to this

section may, by providing written notice to the developer and without incurring any liability for doing so, rescind the purchase agreement within 10 days from the date the purchase agreement was executed by the parties to it. 12(4) A purchaser may not rescind the purchase agreement under subsection (3) if all the documents required to be delivered to the purchaser under subsection (1) have been delivered to the purchaser not less than 10 days prior to the execution of the purchase agreement by the parties to it. 12(5) If a purchase agreement is rescinded under subsection (3), the developer shall, within 10 days from the developer's receipt of a written notice by the purchaser of the rescission, return to the purchaser all of the money paid in respect of the purchase of the residential unit. 12(6) A developer shall provide to a purchaser of a unit prior to or at the time that the purchaser takes possession of the unit or proposed unit an occupancy permit or permission in writing to occupy the unit or proposed unit that is issued or given pursuant to the regulations under the Safety Codes Act . 13.

Rescission of purchase agreement Every developer who enters into a purchase agreement shall include in the purchase agreement the following: (

a) a notification that is at least as prominent as the rest of the contents of the purchase agreement and that is printed on the outside front cover or on the first page of the purchase agreement in bold face, in upper case and in larger print than the rest of the purchase agreement stating as follows: "The purchaser may, without incurring any liability for doing so, rescind this agreement within 10 days after its execution by the parties to it unless all of the documents required to be delivered to the purchaser under

section 12 of the Condominium Property Act have been delivered to the purchaser not less than 10 days prior to the execution of this agreement by the parties to it."; (

b) where the units and the common property are not substantially completed at the time that the purchase agreement is entered into, a description, drawing or photograph showing (

i) where there is a building, the interior finishing of and all major improvements to the common property located within a building, (ii) all major improvements to the common property, other than those to which subclause (

i) applies, (iii) any significant utility installations, major easement areas, retaining walls and other similar significant features,

(iv) the recreational facilities, equipment and other amenities to be used by the persons residing in or on the residential units, (

v) the equipment to be used for the maintenance of the common property, (vi) the location of roadways, walkways, fences, parking areas and recreational facilities, (vii) the landscaping, and (viii) where there is a building, the exterior finishing of the building, as they will exist when the developer has fulfilled the developer's obligations under the purchase agreement; (

c) the amount or estimated amount of the monthly unit contributions that has been determined on a reasonable economic basis in respect of the unit; (

d) the unit factor of the unit and the basis of unit factor apportionment for all units comprised in the condominium plan. [ 11 ]

Section 80 of the Act provides: 80 Application of Act 80(1) This Act applies notwithstanding any agreement to the contrary and any waiver or release given of the rights, benefits or protections provided by or under sections 12 to 17 is void. 80(2) A remedy that a purchaser of a unit has under this Act is in addition to any other rights or remedies that the purchaser has. 80(3) A purchase agreement may be enforced by a purchaser notwithstanding that the developer failed to comply with this Act. Was Proper Disclosure Provided by the Plaintiffs to the Defendants? [ 12 ] The issue here is purely one of credibility.

I will review and comment upon the evidence impacting upon that issue. Sydney Forman [ 13 ] Ms. Forman gave evidence that she always follows the same procedure. She fills out the offer to purchase and has the purchaser sign; she explains that the purchasers are acknowledging receipt of the disclosure documents; then she hands them the binders.

When asked whether she remembered giving Samreen the condominium documents, she responded, “I always do it the same way, so I would say yes.” She says that Samreen took all of the disclosure documents at once and that she remembers discussing with Samreen that it was a lot to carry. [ 14 ] She says that, on the following day she met with Samreen again, and Samreen had the power of attorney to allow her to execute an offer to purchase from her sister Samina. She says on that occasion “it would have been done exactly the same way”. [ 15 ] Further, Ms.

Forman says that she met with Samreen to sign up the Alberta New Home Warranty program agreements. Her evidence is “I would say definitely that I met with her and got her to sign these, because they have her signature”. [ 16 ] She then states that in August she exchanged emails with Mohammed Soroya regarding the purchase of an additional unit, and acknowledged that Qualex did an additional deal for him and his wife, the whole thing having been concluded by fax. She maintained that Qualex “Fedexed” signed copies of the agreements and condominium disclosure documents to Mr. Soroya. [ 17 ] In cross-examination Ms.

Forman acknowledged that she was paid a commission for closing sales, with 75% payable to her at the time that the contracts are written up, and the additional 25% being payable on closing. However, since she had left the employ of Qualex, she did not know whether closing of these transactions would result in her being paid the remaining 25% of the commission. [ 18 ] Ms. Forman further acknowledged that, while the wording of the offer to purchase indicates that the purchaser acknowledges

having received a fully executed copy of the “purchase agreement”, indeed, the offer had not been accepted by Qualex at that time, and therefore the representation within the document was incorrect.

She also acknowledged that the agreement contained an acknowledgement by the purchaser that the purchaser had read the binder of disclosure documents, when in fact, to her knowledge, he/she had not. [ 19 ] With respect to her evidence that she met with Samreen on May 28, 2006, Defence Counsel points out that the document exchange was actually done by fax, not in person (see Exhibit 1, Tab 17, which shows facsimile transmission to and from Samina at the top of each page).

The same error in her memory was pointed out with regard to the signing of the Alberta New Home Warranty documents. [ 20 ] With respect to the August transaction with Mohammed Soroya, Ms. Forman acknowledged that she signed as a witness to the signatures of the purchaser when in fact she was not present and did not witness those signatures. She acknowledges that, at the time of transmission, Qualex had not accepted the offer to purchase notwithstanding that the document states otherwise. She acknowledges that she does not actually recall fedexing the contract or the disclosure documents.

She acknowledges that she can’t say she sent them out at all; however she says it was standard practice to do so. Dr. Anwar [ 21 ] Dr. Anwar is estranged and divorced from Samreen Soroya. He gives evidence that he only wanted to buy one condominium unit, but his wife thought that she should buy one as well convincing him that they could afford the investment. He says that Sydney Forman provided disclosure documents with a copy of the signed offer to purchase. At that point Dr. Anwar says he had to leave, and he did so, taking only the signed offer to purchase, and asking Samreen to bring his binder home with her.

He acknowledges initialling each page of the offer to purchase, and says that he did so before the condominium documents binder was provided by Ms. Forman. [ 22 ] Dr. Anwar was not present while his wife executed the additional offers to purchase for her family. [ 23 ] Dr. Anwar indicates that, when he got home that evening the execution of the offers to purchase was the topic of the evening. He says that he asked Samreen whether she had brought the condo documents home and she said that she had. She indicated her family had bought a number of units, one for her father, one for her mother and one for her brother.

He says that there was a stack of the condominium disclosure document binders sitting on the island in the kitchen. He says he took his binder downstairs to review it. [ 24 ] He further states that, sometime later, Samreen was travelling to England to see her family and that she said she was taking the agreements and a copy of the condominium disclosure documents with her, which he says he saw placed inside her suitcase. [ 25 ] In cross-examination he acknowledged that he was upset by the Petition for Divorce, but maintained that there was no ill-will from him towards Samreen.

He denied having involvement with the Soroya family purchases. He denied sending scathing messages to Samreen on Facebook or creating and issuing a “blog” which was critical and accusatory of the Soroya family. Christopher Colveck [ 26 ] Mr. Colveck is the vice-president of sales and marketing at Qualex, having held that position for the last 7 years. He talked about the training of Qualex’s employees and that he had particularly emphasized to those employees the importance of the delivery of the condominium disclosure documents and the ten day rescission period that is triggered by that disclosure.

He gave evidence that 300 binders of disclosure documents were ordered and sent to the sales office preparatory to the Nova launch. [ 27 ] He gives no direct evidence as to the occurrences between Ms. Forman and Samreen on May 27 th or May 28 th . He acknowledges that, having received all of the executed offers to purchase, he took them to his office in Vancouver and reviewed them before signing them on behalf of Qualex and faxing them back to the Calgary sales office. [ 28 ] Mr.

Colveck identified Exhibit “4” in the proceedings, which is a FedEx invoice and shipper details statement showing a delivery from Qualex to Mohammed Soroya in London, England, delivered August 4, 2006, being one package with a weight of 1.9

pounds. He acknowledged that Qualex’s solicitor received a Notice of Rescission from the solicitors for the Defendants sent by letter of April 30, 2009 (Exhibit “1”, Tab 30). [ 29 ] On cross-examination he acknowledged that, while the offers to purchase signed by the purchasers indicate that the purchasers have received a fully signed contract, in fact, they have not in this circumstance, because he did not sign off on the offer to purchase until some days later in Vancouver. He acknowledged that would also be the case with the August offer to purchase signed by Mohammed Soroya. Tim Taylor [ 30 ] Mr.

Taylor was working for the Plaintiff at the time of the Nova launch and was involved as a salesman in that Nova launch. He is no longer employed at Qualex. He indicates he was well trained on the need to provide condominium disclosure documents to a purchaser and the 10 day rescission period was well understood by him. [ 31 ] Mr. Taylor indicates that he saw Samreen Soroya take the condominium disclosure documents. He indicates there was some laughter about how many there were and that she was carrying them. He says that they were stacked to approximately five high.

He gave evidence that he knew there was a group of people coming in to make a number of purchases because he had been advised of that intention by Ms. Forman before it occurred. [ 32 ] In cross-examination he was confronted with the previous evidence of Ms. Forman, that she had only been expecting Dr. Anwar, and not others, and did not know before hand that they were contemplating purchasing a number of units, and that Dr. Anwar’s wife and father-in-law arriving with Dr. Anwar was a surprise to her on the day of May 27 th , 2006. [ 33 ] Mr.

Taylor acknowledged that he had previously filed an Affidavit in these proceedings, but he had never deposed in any Affidavit that he had seen Samreen loaded with the disclosure documents as described in his direct evidence. Defence Witnesses: Mohammed Soroya [ 34 ] Mr. Soroya gave evidence from Sudan by way of video conferencing. Some difficulties were encountered in that some Exhibits, most noticeably Exhibit number “2” (the Disclosure Documents Binder), was not before him. Mr. Soroya is 78 years old . He was born in Nairobi. He has spoken English since he was young when he learned to both read and write it.

He lived in London for 15 to 25 years, according to his testimony. He is a businessman who owns or has owned a number of hotels in the London area, that he refers to as “Bed and Breakfast”. He has made property investments, including a 20 acre property in Springbank, Alberta and a condominium in Calgary. Mr. Soroya indicates that he had received the August purchase agreement from Qualex by fax. He indicates that he received some brochures regarding the property. He denies that he ever received the condominium disclosure documents. His counsel held the binder up so that the camera could show it to Mr.

Soroya, who denied ever having received the binder. [ 35 ] In cross-examination, however, Mr. Soroya indicated that he could not even read the writing on the document that had been held up in front of the camera by his counsel. [ 36 ] Mr. Soroya was not able to identify any information about the brochures that were sent to him, nor did he have them to produce. [ 37 ] Mr. Soroya acknowledged that his daughter brought copies of the agreements which she had executed on his behalf and on behalf of her mother and her brother. He acknowledged having read the agreements.

He says that he does not remember the provision on page 1 of the agreement advising of the right of rescission. He originally denied involvement in a number of businesses or properties in his name or that of his family, but then acknowledged involvement upon evidence to the contrary being put before him. His “Bed and Breakfasts” included a 60 room hotel in London.

[ 38 ] I note, here, that Mr. Soroya’s evidence, in terms of detail, was greatly lacking. He often denied knowledge or memory. He was very reluctant to provide direct answers to direct questions, and often denied having knowledge about matters that were otherwise evident. Samreen Soroya [ 39 ] Ms. Soroya obtained a degree in law in England in 1999. She then took a course equivalent to Alberta’s CPLED course. She then had 2 years of work experience in England, practising predominately employment law and “non-contentious work”. She was qualified as a lawyer in July of 2003.

She got married in July of 2003 and moved to Calgary in August of that year. She was required to write 2 examinations in Alberta in constitutional law and income tax. She had work experience as an articling student from 2003 to 2007, and was admitted to the Alberta Bar in 2007. [ 40 ] Ms. Soroya indicated that her marriage was unstable, maintaining that Dr. Anwar was violent towards her in that relationship. She says that 4 months after she came to Calgary she was living with her in-laws, then returned to London for some time before her parents talked her into returning to Calgary and to her marriage.

She eventually moved back to England in September of 2007 and filed for divorce in 2008. [ 41 ] Samreen indicated that she was buying her unit on behalf of her husband, who had already approached his bank and obtained approval for mortgages for two units. Because the condominium units were being offered “one to a customer” she was signing the second offer to purchase in her own name. In addition, on recommendation of her husband, her family members also wished to purchase units in the complex.

To that end, she obtained powers of attorney from her father, her mother, and her brother, and the next day, from her sister. [ 42 ] Ms. Soroya indicates that when they arrived at the launch centre, it was very busy with a lot of people there. She says that Ms. Forman was very nice but was rushed off her feet. She says that she, Dr. Anwar, and his father went with Ms. Forman into Ms. Forman’s office. She says that her husband was in a rush to get his contract signed up. She says that Ms. Forman put the contract in front of him, and showed him where to sign.

She pointed and flipped the pages and sped through the signing. She indicates that Ms. Forman did one contract at a time and that no time was provided to read the contracts. Ms. Forman pointed to the places on the pages, telling each of them to initial or sign. She acknowledged initialling and signing the contracts for herself, her parents and her brother but says that she did not read anything as there was no time to do so. She says she was not given any other documentation to read. She does not remember whether Qualex had already signed the document when she was signing.

She maintains there was no discussion about disclosure binders and that she was not told that such binders existed. She was not told she should read through the contract before signing. She did not leave with any disclosure binders, of which she says she is absolutely sure. She denies seeing Mr. Tim Taylor that day. She denies that Ms. Forman offered to FedEx the documents to her. [ 43 ] With respect to the Alberta New Home Warranty program documents, Ms. Soroya denied any memory of signing them, although she did not deny that it was her signature on the documents.

She indicates that she does not remember meeting with Ms. Forman for the purpose of signing those documents. She indicates that, at the time of signing those documents she still had not received any disclosure binders. [ 44 ] Ms. Soroya maintains that she did not know about the rights provided under sections 12 , 13 and 80 of the Condominium Property Act until the Soroya family obtained legal counsel in respect to the condominium purchase agreements. [ 45 ] Ms.

Soroya gave evidence that, during her separation from her husband she received emails from an unidentified source that were highly abusive of her and that the emails called her names only ever used by her husband; derogatory names that he had made up. [ 46 ] In cross-examination Ms. Soroya acknowledged signing all of the agreements, and that the purchases were roughly at a value of $2,000,000.00. She knew the effect of signing an agreement, but nevertheless did not read the agreement, maintaining that “I was just a vehicle”, “I was rushed” and “they were nothing to do with me”.

She could not recall whether, on May 28, 2006, when she was signing the contract for Samina, she was rushed or precluded from reading the contract. She denied reading the contracts after having signed them. She denied seeing the bold printing regarding rescission rights. She denied that Ms. Forman advised her of the 10 day rescission period.

[ 47 ] She acknowledged that she was owner of certain pieces of property in England; however she maintained that she was not aware that she was an owner until the matter was brought to her attention that very day. It was pointed out that she had sworn a Statutory Declaration earlier, in relation to her matrimonial dispute, wherein she failed to list her interest in four pieces of property in England. Analysis [ 48 ] None of the witnesses have given unassailable evidence in this proceeding.

The Court acknowledges that the events in question took place some 5 years before trial, and memories fade. [ 49 ] I believe that Ms. Forman was doing her best to provide her evidence accurately. Nevertheless, it has been proven that her memory was faulty where she testified that she met with Ms. Soroya on May 28, 2006, and again in August 2006 to sign up with the Alberta New Home Warranty program documents; both of which proved to have been faxed between her and Samreen Soroya. [ 50 ] Ms. Forman is inconsistent on the subject of whether she provided binders to Ms. Soroya on May 27, 2006.

Initially she says that she handed the books of condominium documents to Samreen (p. 39, line 22). However, later she indicated that she always followed the same procedure when going through the contract page by page, and handing the purchaser the binder at the same time as the initial second page of the offer to purchase acknowledging receipt of the condominium documents. With respect to her dealings with Samreen, she testified “I always do it the same way, so I would say yes” (p. 46, line 32). That is to say, she is relying on her procedure, rather than on her direct memory. [ 51 ] However, Ms.

Forman testifies directly that there was a conversation between her and Samreen about Samreen carrying all of the condominiums document binders, and her offer to FedEx them to England rather than have her carry them away. [ 52 ] Tim Taylor gives evidence that he saw Samreen taking the disclosure documents with her. However, Tim Taylor’s memory is flawed in that he recalled that an hour and a half had been set aside before the launch commenced so that Ms. Forman could meet with the Soroya family for a large number of transactions. In fact, Ms. Forman says that she was only anticipating the arrival of Dr.

Anwar, she had set aside a meeting time of ½ an hour to 45 minutes, and she was surprised when Dr. Anwar was accompanied by his father and his wife. [ 53 ] Further, if Mr. Taylor had this direct memory of Samreen taking the documents with her, and given that he has sworn an Affidavit in these proceedings, it is indeed surprising that he had not deposed to this memory beforehand when the Plaintiff was applying for

summary judgment based on Affidavit evidence. [ 54 ] Dr. Anwar gives direct evidence that his wife had brought home the disclosure documents, and that he obtained his document from the pile that she had transported. Further, he gives direct evidence that she took one of the binders of disclosure documents with her to England in her suitcase. [ 55 ] However, Dr. Anwar has gone through a divorce from Samreen. I was not in the least convinced of his denial of ill-will towards Samreen. [ 56 ] Dr.

Anwar also professes a lack of involvement with the Soroya family regarding their purchases and the purchase made by Samreen. Given that the proposal was originally brought by Ms. Forman to Dr. Anwar, I have grave doubts about his professed lack of involvement. [ 57 ] The credibility of Mr. Colveck is not in question. However, he has no direct knowledge of the delivery of the documents to Samreen.

He puts forth the FedEx invoice, Exhibit “4”, showing that at one point a 1.9 pound package was fedexed to Mohammed Soroya in August of 2006, but acknowledges that there is no cover letter or any information within Qualex that shows exactly what was sent by FedEx on that day.

[ 58 ] I found Mr. Mohammed Soroya’s evidence to be quite unsatisfactory. He was evasive and vague, and purported to have little or no knowledge of significant investments that he and his family had made. Given that he has been involved in business in England for some 20 to 30 years, I found this evidence to be disingenuous. On the critical point, Mr. Soroya acknowledges a vague memory of receiving some brochures by FedEx from Qualex, the contents of which he was unable to describe. [ 59 ] Samreen Soroya flatly denies having received the contract documents.

I am troubled, however, by the fact that Samreen was an admitted lawyer in England, an articling student in Canada, fully aware of the impact of signing offers to purchase, fully able to read the contents of the documents, and was investing some $2,000,000.00 on behalf of her family.

Her professed lack of interest in the transactions and her professed failure to read any of the contract, including the portion of the contract wherein she acknowledged receipt of the disclosure documents, gives me pause. [ 60 ] Each contract includes a term on p. 2: THE PURCHASER ACKNOWLEDGES RECEIPT OF A FULLY EXECUTED COPY OF THE WITHIN OFFER TO PURCHASE AND REAL ESTATE PURCHASE CONTRACT AND ACKNOWLEDGES THAT THE PURCHASER HAS READ AND UNDERSTANDS THE TERMS, PROVISIONS, CONDITIONS AND LIMITS THAT ARE SPECIFIED IN ALL SCHEDULES AND ALL DOCUMENTS REFERRED IN ADDENDUM “A” CLAUSE 19 HEREIN WHICH PERTAIN TO THE PROJECT. [ 61 ] On p. 7 of 12 of the Addendum attached to the Purchase Contract is listed, under para. 19, “Schedules to Offer, indicates: THE PURCHASER HEREBY ACKNOWLEDGES RECEIPT OF COPIES OF THE FOLLOWING SCHEDULES WHICH ARE BY THIS REFERENCE INCORPORATED HEREIN AND MADE A PART HEREOF AND ALL OF WHICH PERTAIN TO THE PROJECT, NAMELY: . . .

That page has been initialled on each offer by Samreen Soroya. [ 62 ] However, the offer to purchase itself is by its terms, inaccurate. The purchaser signs the document as an acknowledgment that the purchaser has received the real estate purchase contract, when in fact it has not been executed by Qualex and has not become a contract.

It also contains an acknowledgment that the purchaser has read and understands the terms, provisions, conditions and limits that are specified in all schedules and all documents referred in addendum “A” clause 19, when in fact those documents are only provided to the purchaser at the time the purchaser signs the contract, and, in fact, the purchaser has had no opportunity to review the condominium disclosure documents. [ 63 ] Accordingly, it would be wrong for the Court to decide this issue based upon the purported acknowledgments contained in the offer to purchase executed by Samreen Soroya. [ 64 ] The Court also notes and accepts that there would be no good reason for Ms.

Forman to intentionally withhold the condominium disclosure documents from a client signing an offer to purchase; as to do so would risk, for no reason, the very situation that has arisen here. I accept that Ms. Forman had a practise which she routinely followed, of providing the disclosure documents to the purchasers. The question is not whether she intended to do so; it is whether she failed to do so, by oversight. [ 65 ] Were I to accept the evidence of Dr. Anwar, it would conclusively prove that Samreen Soroya had received the disclosure documents. I do not. Dr.

Anwar is motivated by malice towards Samreen and her family. His version of the decision by him and Samreen to buy one unit each, and his denial of involvement in the family plan to buy more, is not believable.

[66] Were I to accept Tim Taylor’s evidence that he saw Samreen with the disclosure documents, that also would be conclusive. Ido not. Mr. Taylor has tried to give supportive evidence at the last. He has never before asserted a memory of such an occurrence despitehaving sworn previous Affidavit evidence in the proceedings, and even where the Plaintiff sought

summary judgment. His memory ofsurrounding events, that the meetings with the whole family were expected and planned, is demonstrably false. [67] Ms. Forman’s evidence is inconsistent. She based her memory not on what she did but upon her practice. Her memory as tosubsequent meetings with Samreen has been proven to be in error. I am not persuaded by her evidence that she gave the binders ofdisclosure documents to Samreen on May 27, 2006.

I am satisfied she never gave them to her on May 28, 2006 nor when the AlbertaNew Home Warranty Program documents were signed. [68] I am troubled by the cavalier attitude taken by Samreen Soroya to the signing of offers amounting to $2,000,000.00 in valueon behalf of her family, given her position as a solicitor in England and an articling student in Alberta. Nevertheless, I accept herevidence that she did not receive the binders of disclosure documents on May 27, 2006. [69] With respect to the August purchase by Mohammed Soroya and his wife Mumtaz, I find the evidence of Mohammed Soroyato be wholly unreliable.

I find that the condominium disclosure documents were sent to him and his wife Mumtaz in London by FedExand were received by him in August of 2006. [70] This finding not only impacts upon the August transaction, but also on the offers to purchase that each of Mohammed andMumtaz made by their agent Samreen, on May 27, 2006. In August 2006 they received the necessary disclosure, the provision of whichsatisfied Qualex’s obligations in respect of each of their three purchase contracts. Estoppel [71]

Section 80 of the Condominium Property Act states that “This Act applies notwithstanding any agreement to the contrary andany waiver or release given of the rights, benefits, or protections provided by or under sections 12 - 17 is void.” The Plaintiff does notargue that the Defendants have waived or released their rights under

section 12 of the Condominium Property Act. However, the Plaintiffmaintains that, by virtue of their conduct, the Defendants are estopped from asserting those rights to terminate the purchase agreements. [72] The Plaintiff cites Goulston v. Aldred,

(2010) BCSC 241 at para. 52 as setting out the test for estoppel as follows: Where a party unequivocally affirms a contract, whether by words or conduct or where the circumstances would make it unjust,inequitable or unfair for that party to resile from the contract, he or she will be estopped from doing so. [73] The Plaintiff also cites the doctrine of Promissory Estoppel, that, where one party has, by his words or conduct, made to theother a promise or assurance which was intended to affect the legal relations between them and to be acted on accordingly, then, once theother party has taken him at his word and acted on it, the one who gave the promise or assurance cannot afterwards be allowed to revertto the previous legal relations as if no such promise or assurance had been made by him, but he must accept their legal relations subject tothe qualification which he himself has so introduced, even though it is not supported in point of law by any consideration but only by hisword. (First City Trust Co. v.

Triple 5 Corporation (1989) 1989 ABCA 28 , 65 Alta. L.R. (2d) 193 (Alta.

C.A.), at para. 83. [74] I accept those statements as proper descriptions of the law of estoppel and promissory estoppel. [75] The Plaintiff describes the steps taken by the Soroyas to affirm purchase agreements, by such things as making the first andsecond deposits on the units, by indicating on May 13, 2008 that they would be closing on the units, appointing a real estate agent toconduct walk throughs of the suites on the Plaintiff’s behalf on July 23, 2008, and by requesting an extension of the closing date onDecember 1, 2008 in order to obtain financing.

The correspondence between the parties in respect of these matters is exhibited at trial. [76] On April 3, 2009 after Qualex commenced the action, the Defendants took the position, through their lawyers, for the first

time, that they did not receive the disclosure documents and that they had therefore been deprived of their right of rescission. [ 77 ] The Plaintiff argues that it would be unfair to allow the Soroyas to rescind the agreements, once they have taken the steps described above.

The units were tied up by the contracts between the parties during a time when the Calgary real estate market nosedived and Qualex was deprived of the opportunity to market and sell the units to other purchasers in the booming real estate market that existed in May 2006; such that Qualex relied to its detriment on the Soroyas representations that they would complete the transactions. [ 78 ] The Plaintiff cites Novam Developments v.

Hutchins , [1992] BCJ 1356 wherein Justice Saunders stated the issue to be whether the purchaser had so conducted himself that it would be inequitable for him to avoid the contract he made. Justice Saunders noted that for a significant passage of time the purchaser had “tied up” the property between February and November 1990 and noted that the purchaser affirmed the contract by paying the second deposit and were requesting and receiving extensions to the closing date; and that the purchaser had deprived the vendor of the opportunity to market the unit until the real estate market had fallen.

Justice Saunders found an estoppel in the face of

section 62 of the B.C. Act , which stated at the time that “no promise or agreement to purchase...any subdivided land...is enforceable against a purchaser...by a person who has not provided the required disclosure documents”. [ 79 ] The Defence argues that the Novam case should simply not be followed. It is of course not binding on this Court. The Defence puts forth, instead, the decision in Bugar v. 928028 Alberta Ltd. , [2007] AWL D 954 , a decision of the Alberta Provincial Court, Civil Division.

In that case, Judge Hess found, as a matter of fact, that the purchaser did not receive copies of the purchase agreements and disclosure documents until almost one year after their amended offer to purchase was accepted by the vendor. He determined that, as the vendor did not provide the required documents, the purchasers were denied their right of rescission; alternatively he decided that the parties had failed to reach an agreement because of the failure of the vendor to comply with the mandatory provisions in the Act , which provisions are included for the protection of purchasers of residential condominiums.

He determined that strict compliance by the vendor is required. As the vendor had failed to comply, he held the vendor to be in violation of the provisions of the Act , and therefore determined that the vendor could not enforce the terms of the purchase agreement. [ 80 ] It is not clear from reading the reasons provided by Judge Hess, as to whether a distinction between waiver and estoppel was argued before him, or whether estoppel was argued at all. [ 81 ] In Clyne v. Lear Enterprises Ltd. ,

(2009) Carswell Alta. 697 Provincial Court Judge Jacobson followed the decision in Bugar and found that the vendor’s failure to comply with

section 12 and 13 of the Act entitled the purchaser to resist enforcement of the contracts, stating that the vendor, having failed to comply with the Act , is in breach of the contract and not entitled to enforce it. [ 82 ] Reference was also made to the decision of the Alberta Court of Appeal in Hi Hotel Ltd. Partnership v. Holiday Hospitality Franchising Inc. , [2009] AWLD 498 . In that case the Court was reviewing the Franchises Act , which also provides a right to rescind if there is insufficient disclosure, or incomplete execution of required documents.

The Court noted that the requirement in the Franchises Act was mandatory, in that a franchiser must give every prospective franchisee a copy of the franchiser’s disclosure document. In that case, the Court of Appeal ruled against application of fairness principles or equitable rules where legislation is directive and mandatory. [ 83 ]

Section 12 of the Condominium Property Act was enacted to protect purchasers.

Section 80 directs that the purchaser’s rights contained therein can neither be waived nor released. In my opinion the legislation has occupied the arena. It is the clear intention of the legislature that transactions entered into without proper disclosure being provided to the purchaser are voidable by the purchaser. If disclosure is provided by the vendor to the purchaser, the purchaser then has 10 days within which to decide to rescind the offer/contract.

If there has been no such disclosure, then the purchaser has not been given the opportunity, directed by the legislation, to consider his position and whether he wishes to rescind. [ 84 ] Because the disclosure has never been provided to the purchaser, the purchaser cannot make an informed decision as to whether to exercise the right of rescission. In such circumstances, the purchaser cannot be said to be estopped from asserting his right to rescind. The disclosure triggers the right to rescind. Without disclosure by the vendor the purchaser’s right to rescind within 10 days has not arisen.

The vendor has breached the contract. [ 85 ] Promissory Estoppel also does not arise. No representation was ever made by the purchasers that they would not rescind. If disclosure has been provided, and the purchaser represented before the expiry of 10 days that he was not going to rescind, then a Promissory Estoppel could arise. That is not the case here.

[ 86 ] I am satisfied that neither estoppel nor promissory estoppel lies in these circumstances. Accordingly, where the disclosure documents have not been delivered to the Defendants then the contracts are unenforceable. Conclusion [ 87 ] In conclusion, in regard to the offers to purchase made by Samreen Soroya on behalf of her brother and her sister, I find that the required condominium disclosure documents were never provided to the purchasers or their agent by the Plaintiff. I find that Samreen’s brother and sister are not estopped from exercising their rights of rescission.

With regard to the May 27 th offers to purchase by each of Mohammed and Mumtaz Soroya and with regard to the August offer to purchase by Mohammed and Mumtaz Soroya, I find that the disclosure documents were provided to the purchaser and that the purchaser did not rescind within the allowed 10 day period thereafter. [ 88 ] Counsel may speak to me regarding costs. Heard on the 27 th day of April, 2011. Dated at the City of Calgary, Alberta this 27 th day of May, 2011. R. J. Hall J.C.Q.B.A. Appearances: Trevor R. McDonald and Ben Aberant for the Plaintiff John D. Blair, Q.C. for the Defendants