Lobban v Wilkins, 2014 ABQB 653

Court of Queen ’ s Bench of Alberta Citation: Lobban v Wilkins, 2014 ABQB 653 Date: 20141031 Docket: 0704 00848 Registry: Grande Prairie Between: Guy Lobban Plaintiff - and - Roger Wilkins and Keith Baillie Defendants - and - Roger Wilkins Plaintiff by Counterclaim - and - Guy Lobban Defendant by Counterclaim _______________________________________________________ Reasons for Judgment of the Honourable Mr. Justice K.D. Yamauchi _______________________________________________________ I. Introduction [ 1 ] This Court heard this matter over a period of 2 days.

The parties were the 3 witnesses who presented oral testimony. As well, the Director of Planning for the County of Grande Prairie presented this Court with his evidence. [ 2 ] This matter involves an alleged sale of certain lands legally described as follows: North West Quarter

Section 28 Township 74 Range 5

West of the 6th Meridian (the "Lands") [ 3 ] The primary issue in this action is whether there was a sale or an agreement to lease the Lands. Secondary issues flow from it, which this Court will deal with later in these reasons. II. Background [ 4 ] The parties take completely different positions on what occurred, which resulted in them being before this Court. It is worthwhile to provide their respective positions. Thereafter, this Court will review the testimony they presented to it, along with this Court’s findings of fact. A.

Lobban’s Position [ 5 ] On February 10, 2007, the Guy Lobban (“Lobban”) alleges that he entered into a contract (the “Contract”) with Roger Wilkins (“Wilkins”), in which Wilkins agreed to sell and Lobban agreed to purchase a portion of Lands (the “Subject Property”), for use as an airstrip. The Lands would be subdivided to create a legal description for the Subject Property. Lobban would be responsible for applying for subdivision and Wilkins would provide all required consents relative to the subdivision application.

The engineering firm of Beairsto Lehners Ketchum Engineering & Survey Ltd (the “Engineers”) was to act as Wilkins’ agent in relation to the subdivision. If Lobban or Wilkins failed to complete the Contract according to its terms, the non-defaulting party would be allowed to pursue all available remedies. [ 6 ] The purchase price for the Subject Property was $40,000 plus goods and services tax, payable by way of an initial deposit of $5,000, and $35,000 on closing. Lobban paid Wilkins the $5,000 on February 9, 2007.

Lobban then began the subdivision process with the County of Grande Prairie (“County”). [ 7 ] Lobban alleges that Wilkins and Keith Baillee (“Baillee”) attended the County’s council meetings with a view to frustrating the subdivision process. On August 8, 2007, and September 4, 2007, Wilkins provided to the County written cancellation of the application for subdivision of the Lands, whereupon the County terminated the subdivision application. [ 8 ] Lobban further alleges that at all material times Baillie was Wilkins’ neighbor and was aware of the Contract.

At each of the County’s council meetings where the subdivision application was discussed, Baillie attended alone or alongside Wilkins in an attempt to induce Wilkins to remove his consent to the subdivision. Baillie was aware that Lobban intended to purchase the Subject Property. Lobban alleges that it was an intentional act on Baillie’s part to interfere with the Contract. [ 9 ] Lobban originally sought specific performance of the Contract.

Now, he seeks the return of the $5,000 deposit, his costs for the subdivision application, and travel time to and from the place he currently stores his aircraft. [ 10 ] With respect to Wilkins’ counterclaim, which this Court discusses below, Lobban denies that the fair market value of the Subject Property varies much from the $40,000 offer that he made. Wilkins had previously sold a larger portion of the Lands in the same location for $40,000 and was willing to accept less than the amount Lobban offered.

Lobban, however, offered the full $40,000 to Wilkins, which Wilkins accepted. [ 11 ] Further, Lobban states that at no time did he act in a malicious, oppressive or high-handed manner. He had communicated openly and honestly with Wilkins regarding the purchase of the Subject Property and at all material times Wilkins was aware of the subject-matter of the Contract. B. Wilkins’ Position [ 12 ] Wilkins says that the location where the parties reside is important. Lobban resides in a subdivision known as JD Willis Estates, in the County. Baillie also resides in JD Willis Estates in close proximity to Lobban.

Wilkins resides on land that is adjacent to JD Willis Estates and backs onto the land on which Lobban’s residence is located. [ 13 ] The Lands are primarily old growth forest with the exception of a hayfield, which Wilkins farms. [ 14 ] On February 10, 2007, Wilkins alleges that Lobban attended on the Lands where Wilkins and his friend Gordon Berg were outside clearing snow. Wilkins recognized Lobban as one of his neighbors, although it had been 5 years since they last spoke with one another. Lobban approached Wilkins and verbally offered to lease his hayfield from him.

Wilkins alleges that the offer to lease was Lobban’s own initiative, as Wilkins had never before spoken to Lobban about this. [ 15 ] The terms of the offer to lease involved Lobban leasing the Subject Property for a 10-year term and at a rate of $1,000 per year. Lobban represented to Wilkins that the Subject Property would be used as an airstrip for landing a light plane. This, Lobban said, would have a minimal impact on the Subject Land’s current use.

Lobban presented a $5,000 cheque to Wilkins, which Lobban said was a prepayment for the first 5 years of the lease. [ 16 ] Wilkins agreed to the lease, on the terms and conditions as stated by Lobban. Lobban also presented Wilkins with the Contract which he represented to Wilkins was an accurate reflection of the lease terms and conditions, as discussed. Wilkins, relying on Lobban’s representation, executed the Contract by signing his name at the place indicated by Lobban. The entire transaction lasted no longer than 15 minutes.

[ 17 ] Wilkins did not review the Contract before he signed it. Gordon Berg, although he did not review the Contract, witnessed Wilkins’ signature. Wilkins states that the document did not accurately state the terms and conditions that he and Lobban discussed concerning the lease of the Subject Property. [ 18 ] Baillie received written notice from the County, dated June 8, 2007, of a proposed subdivision of the Lands. He approached Wilkins to discuss the proposed subdivision. Wilkins advised him that he had not sold the Subject Property but had only entered into a lease for an airstrip.

The County's correspondence of June 8, 2007, also included a tentative plan showing a subdivision prepared by the Engineers. That plan was not the same plan that was attached as

Schedule "A" to the Contract. [ 19 ] The County scheduled a public meeting for August 7, 2007, for the hearing of submissions on an application to amend the county land use bylaw to re-designate the Subject Property from an agricultural district to a country residential district. This would allow for the subdivision. [ 20 ] Wilkins, Baillie and Gordon Berg attended the August 7, 2007, County council meeting. Baillie, as an adjacent landowner, attended on his own behalf for the purpose of objecting to the proposed application.

He also advised the County council of the misrepresentation with respect to the Subject Property and that Wilkins was not consenting to the rezoning or subdivision of it. Gordon Berg also addressed the County’s council on his own behalf and on Wilkins’ behalf. The County’s council meeting was adjourned to a later date. [ 21 ] On August 8, 2007, Wilkins provided written correspondence to the County, withdrawing the application for the subdivision. On August 17, 2007, the County provided written correspondence to Baillie that the matter was to be reconvened on September 4, 2007.

Before the meeting on September 4, 2007, the County advised Baillie to attend its office with Wilkins and have Wilkins bring proper identification to confirm his position in person. On their attendance at the County office, Wilkins was provided with a letter for his signature. The letter, dated August 28, 2007, was a request to withdraw the application for subdivision.

Wilkins signed the letter and was informed at that time by John Simpson, Director of Planning, that the application would not be proceeding. [ 22 ] On September 4, 2007, the County held another public meeting respecting the Lands and the amendment to the County land use bylaw. The County’s council denied the subdivision application at that time. [ 23 ] The Contract purports to be a real estate purchase contract, yet it deals with the sale of a lot that had no registered subdivision plan and therefore offends

section 94 of the Land Titles Act , RSA 2000, c L-4 [ LTA ]. As a result, Wilkins argues, the Contract is void. [ 24 ] By reason of Lobban’s fraudulent misrepresentation, Wilkins claims that he is entitled to rescind the Contract and by letter dated October 24, 2007, from his solicitors to Lobban’s solicitors, Wilkins affirmed his rescission of the Contract. Alternatively, Wilkins states that he was mistaken as to the Contract’s terms and that he is entitled to rescind the Contract on that basis. [ 25 ] Wilkins has made a counterclaim.

He states that the purchase price of $40,000 for the Subject Property is grossly disproportionate to its actual fair market value. He goes on to say that Lobban’s fraudulent attempt to deprive him of the Subject Property is malicious, oppressive, and high-handed and is deserving of full condemnation and punishment by the courts. Accordingly, he claims a declaration of rescission of the contract, punitive or exemplary damages in the amount of $200,000 and costs. C. Baillie’s Position [ 26 ] Baillie denies that he interfered in any way with the economic relations between Lobban and Wilkins.

At all times, acting in his own self-interest as an adjacent landowner or as Wilkins’ agent. He, therefore, claims the defence of justification for his involvement in the within matter. III. Testimony and Discussion [ 27 ] The testimony that the parties presented confirmed their respective positions in this lawsuit. Accordingly, this Court sees no useful purpose in repeating their testimony. Of importance, however, are their points of clarification and amplification of their respective positions.

As well, there are certain important facts on which they disagree, so this Court is required to determine the evidence it will accept, based on the totality of the circumstances. [ 28 ] Although there was a great deal of discussion concerning the land that Lobban wanted to purchase or lease, this Court finds that Wilkins and Lobban were ad idem that the Subject Lands were those that the Engineers had identified (the rectangular portion, as opposed to the irregularly-shaped portion). This, after all, was intended for an airstrip, and the irregularly-shaped land would not be suitable for this purpose.

That is why the Engineers were retained in the first place. Although there were 2 drawings of the Subject Property, the parties knew exactly which one Lobban wanted to purchase. Wilkins confirmed this during his questioning: Transcript of Questioning of Wilkins, February 11, 2010, p 30, ll 8-20. [ 29 ] The position that Wilkins took concerning the meeting at which the parties signed the Contract differed. In the pleadings, he says that the meeting took place while he and Gordon Berg were shovelling snow. During his examination in chief, he said that he was in his house, when he saw someone coming to his house.

He then went outside. Although nothing turns on this, it illustrates that Wilkins did not have a clear recollection of exactly what had happened that day. Had Lobban “fraudulently misrepresented” what was contained in the Contract, why did Wilkins not have an independent third party, viz , Gordon Berg, take the stand and tell this Court what happened on that day? Instead, Wilkins chose to testify, without the benefit of that independent third party, and it is clear to this Court that Wilkins did not clearly recollect what happened that day.

When questioned further, Wilkins said he “really can’t remember what Lobban said,” although “they went over a few points.” [ 30 ] Wilkins knew that Lobban wanted to purchase the Lands. He testified that Lobban had approached him some time earlier, but

he told Lobban that he did not want to sell the Lands. He could not recall when this initial discussion took place. His response was “maybe 10 years ago.” After that, he said that Lobban had approached him to sell the Subject Property. When asked when that occurred, his response was that he “really did not know.” [ 31 ] Wilkins took the $5,000 cheque. With that money, he bought groceries and paid some bills. [ 32 ] Wilkins also testified that Baillie had told him the $40,000 sale price was not the market price for the Subject Property.

Although Wilkins could not remember when Baillie told him this, he was clear that it was Baillie who told him. He provided this evidence in his examination by Baillie’s counsel, as well as during cross-examination. Interestingly, during his questioning, the following exchange took place: Q Right. And the $40,000, you thought it was reasonable because you had tried to sell 60 acres for the same price before? A Yeah. Q Correct? A Yes Transcript of Questioning of Wilkins, February 11, 2010, p 46, ll 8-13. [ 33 ] During his cross-examination, he said he responded this way, as he was confused.

This Court does not accept that he was confused when he provided this response.

He clearly responded. [ 34 ] As for why he chose not to complete the sale of the Subject Property, this Court accepts that the reason was clearly articulated during his questioning, when he agreed with the statement from Lobban’s then counsel who said that Wilkins did not proceed with the subdivision because he “thought $40,000 was - - you were told $40,000 was not enough for your land.” [ 35 ] This Court also accepts Wilkins testimony during his cross-examination that he would sell the subject Property if the County approved the subdivision, but would lease the Subject Property to Lobban only if the County did not approve the subdivision.

This transaction was reflected in the Contract. See also Transcript of Questioning of Wilkins, February 11, 2010, p 34, ll 20-27; p 35, ll 1-7. For Wilkins to say that he understood the Contract was simply a lease and that Lobban fraudulently misrepresented the nature of the Contract to him is troubling. [ 36 ] Wilkins also knew that if he withdrew the subdivision application, Lobban could not purchase the Subject Property.

Nicholas Lapp, who is the Director of Planning for the County, testified that but for Wilkins’ withdrawal of the subdivision application, the County’s council would have approved the application. [ 37 ] Even though the County denied the subdivision application, Wilkins took no steps to complete the lease with Lobban. In fact, he continued to allow the Subject Lands to be used as hay, and he took the proceeds from the sale of the hay. [ 38 ] Baillie testified that he knew nothing about the sale until after the first County council meeting. His biggest objection was to the airstrip.

He testified that he said this at the County council meeting but this was not evidenced in the minutes of the County council meeting. During cross-examination, Baillie testified that the minutes were wrong. This Court does not believe that he said anything about the airstrip at the council meeting. [ 39 ] Baillie also testified that the Contract did not reflect what Wilkins wanted. However, Wilkins testified that he knew he was selling the Subject Property. This Court is unsure why Baillie knew what Wlikins wanted.

Perhaps it is because the denial of the subdivision is what Baillie wanted. [ 40 ] As with any action involving a civil matter, this Court must establish conflicting facts on a balance of probabilities. It is virtually impossible for a Court to be sure of what actually happened. It must rely on its assessment of the credibility of the witnesses, documentary evidence, and circumstantial evidence. [ 41 ] Based on its assessment of these factors, this Court finds the following facts. Wilkins and Lobban indeed entered into the Contract. The Contract is clear in its terms.

It was a sale contract in which Lobban would purchase the Subject Property from Wilkins for $40,000. There seemed to be some uncertainty on the parties’ parts as to the exact location of the Subject Property, but it mattered not to them. It was 40 acres on the Lands and the exact location and configuration mattered not to them. Lobban wanted the land and Wilkins wanted the money. [ 42 ] Wilkins’ counsel tried to make an issue of Wilkins’ understanding of the transaction and his lack of formal education, such that he did not understand what he was doing. Wilkins is not illiterate, and that was clear to this Court.

As well, Wilkins presented no medical or other evidence that he was incapable of knowing what he was doing. That he understood what the Contract was about, and his responsibilities under it were clear to this Court. Those responsibilities were simply stated in the Contract. Contract para 4.3 stated as follows: 4.3 The application for sub-division approval shall be the responsibility of the Buyer [Lobban]. The Seller [Wilkins] shall provide all required consents relative to the application for subdivision approval and hereby appoints and permits [the Engineers] to act as its agent in relation to the subdivision.

Any and all costs incurred relative to the sub-division application and approval shall be borne by the Buyer.

[43] Wilkins did not live up to his obligations. Why? Baillie advised Wilkins that $40,000 was not enough for the SubjectProperty. This is a typical example of “seller’s remorse.” After all, if Wilkins could get more for the Subject Property, why would hetake less? As Wilkins testified, no one had pressured him to withdraw subdivision application. He did it of his own free will. In otherwords, he knew his obligations and he breached them.

This Court finds that Wilkins is in breach of his obligations under the Contract. [44] There is also no doubt in this Court’s mind that Baillie provided this advice to Wilkins on his learning of the sale. Much ofBaillie’s testimony was self-serving, and not convincing. He may have had a legitimate concern about the airstrip, but he did not expressthat concern to the County, either at the meeting or any time before or after that meeting. This very important fact was not expressed inthe minutes of the County’s council meeting, which this Court accepts as accurate.

Baillie might not have seen a copy of the Contractbefore the County’s council meeting, but he certainly knew its content. He knew Wilkins had sold the Subject Property, and that Wilkinshad to seek the subdivision. That is why he and his common-law wife assisted Wilkins in whatever way they could to block thesubdivision approval. [45] Wilkins and Baillie were successful in their objective. The sale of the Subject Property was not completed. There is no airstripon the Subject Property, and Wilkins has retained title to it. IV.

Discussion [46] There have been many cases that deal with the termination of a contract based on the action or inaction of one party to thecontract. See e.g. 216927 Alberta Ltd v Fox Creek (Town), 1990 ABCA 29 , [1990] AJ No 156, (1990), 72 Alta LR (2d) 52,104 AR 321 (CA) [Fox Creek]; Steiner v EHD Investments Ltd (1977), 1977 ALTASCAD 208 , 6 AR 113, [1977] 6 WWR308 (CA) [Steiner]; Dynamic Transport Ltd v OK Detailing Ltd, [1977] 2 SCR 1072 [Dynamic]; Carruthers v Tioga Holdings Ltd, 1999 ABCA, 17 DLR (4th) 507 [Carruthers]; Mylonas Enterprises Ltd v Foundation Place Inc, 2013 ABQB 385, 565 AR 199[Mylonas].

These are merely examples. This Court referred to Steiner and Dynamic in its decision in Mylonas. Part of the reasoning inthat decision is best summed up when it provided the following quotation at para 34 from Steiner [at 311-213, cited to WWR]: In my view, however, the vendor cannot by failing to apply for subdivision frustrate the entire agreement. Lord Atkinson, in the PrivyCouncil decision of New Zealand Shipping Co. v.

Société des Ateliers et Chantiers de France, [1919] A.C. 1 at 9, said this: …But if the stipulation be that the contract shall be void on the happening of an event which one or either of them can by his own act oromission bring about, then the party, who by his own act or omission brings that event about, cannot be permitted either to insist uponthe stipulation himself or to compel the other party, who is blameless, to insist upon it, because to permit the blameable party to do eitherwould be to permit him to take advantage of his own wrong, in the one case directly, and in the other case indirectly in a roundaboutway, but in either way putting an end to the contract. [47] The same applies in this case.

Wilkins cannot by failing to apply for, or consent to, the subdivision, frustrate the Contract. AsFoisy JA said in Fox Creek at 5 [cited to LEXIS], “the vendor is effecting some type of rescission and that therefore the purchaser isentitled to restitution.” [48] Was the obtaining of subdivision approval a condition precedent to the existence of the obligations contained in the Contract?Absolutely not. The Alberta Court of Appeal said the following in Carruthers at para 4: Government subdivision approval is a condition precedent to conveying part of the parcel.

But it is not a condition precedent to theexistence or validity of the contract to sell part. Indeed, if no more is said, it is an implied term of the contract that the vendors/owners ofthe full parcel will apply for and in good faith seek subdivision approval, and once it is secured, will convey the new parcel covenantedto be sold. [49] The fact that the “new parcel” in this instance cannot be described until subdivision approval is obtained is also not a bar tothe enforceability of the Contract. Such was the situation in Carruthers. So, too, is the situation in this case.

Wilkins pleads LTA s 94(1),which provides the following: 94(1) No lots shall be sold under agreement for sale or otherwise according to any townsite or subdivision plan until a plan creating thelots has been registered. [50] Although this might, in certain circumstances, be determinative of the case, LTA s 94(3)(

b) provides an answer when it saysthe following:

(3) No party to a sale or agreement for sale is entitled in a civil action or proceeding to rely on or plead the provisions of this

section … (

b) if, pursuant to the arrangement between the parties, it was the duty of the party who seeks to rely on or plead the provisions of thissection to cause the plan of subdivision to be registered. Thus, Wilkins cannot rely on LTA s 94(1). [51] Wilkins also relies extensively on Belzil J’s decision in Hittinger v Turgeon, 2005 ABQB 257 [Hittinger]. In many ways, thesituation with which Belzil J was dealing is similar to the case before this Court. Much like the case with which this Court is dealing, thevendor in that case was saying that he lacked capacity.

Belzil J said the following with respect to this: There is a presumption in law that an adult has the capacity to contract. The burden is on anyone attempting to show a lack of capacity:

Hittinger at para 22. Belzil J found that the vendor had capacity for reasons similar to those this Court has found. [52] Belzil J also dealt with the issue of non est factum. He described it as follows: This principle of contract law allows Courts, in very limited circumstances, to set aside a contract where a party has proven that theagreement signed is not the agreement the party intended to sign.

The burden of proof rests with the party seeking to invoke theprinciple: Hittinger at para 42. [53] He went on to provide a quotation from Marvco Colour Research v Harris, (SCC), [1982] 2 SCR 774 at 784,where the Supreme Court of Canada said that to invoke the principle, “the document must be fundamentally different, either as tocontent, character or otherwise from the document that the signor intended to execute.” In this case, Wilkins acknowledged that he knewthat he was selling the Subject Property to Lobban, and that it would be a lease only if he did not obtain subdivision approval, which washis responsibility pursuant to the Contract.

He knew exactly what he was signing, and the Contract reflected the parties’ agreement. Hecannot rely on non est factum. [54] Belzil J also discusses at length the plea of undue influence, and quotes extensively from Geffen v Goodman Estate, (SCC), [1991] 2 SCR 353. Again, in this case, Wilkins bears the burden of proving undue influence. At the risk of over-simplifying Belzil J’s thorough analysis, the principles that might be extracted from his reasoning, as applied in the case at bar are asfollows (paraphrasing from Hittinger at paras 51-54): 51.

Wilkins has not shown that he had a relationship with Lobban, which gives rise to a presumption of undue influence. They wereneighbours, and although they saw each other, they were nothing more than neighbours. Lobban and Wilkins acknowledged that fromtime to time, Lobban would let Wilkins use his telephone, as Wilkins did not have one. They did not socialize. Lobban did not exhibit adominating influence over Wilkins through manipulation, coercion or outright abuse of power. 52. The Contract is a commercial transaction, in the sense that Lobban was buying and Wilkins was selling the Subject Property.

Thus,Wilkins must show that the Contract worked unfairness through a disadvantage to him or that Lobban would have unduly benefittedfrom it. He has not done so. Baillie attempted to introduce evidence that similar properties were selling for far more than Lobban wasprepared to pay. The Court attaches no weight to that evidence, as there was no expert evidence proffered by either side showing thevalue of the Subject Property in 2007. All of the evidence that Baillie presented was much later, and did not give this Court any sense ofwhether the properties were truly comparable.

As the court said in Geffen, “it can be assumed that in the vast majority of commercialtransactions that parties act in pursuance of their own self-interest.” In this case, Lobban wanted the Subject Property and Wilkinswanted the money. 53. If this Court were to find that the presumption of undue influence applies to the facts before it, which it does not, Lobban must beable to show that Wilkins entered into the transaction contemplated by the Contract as a result of his own full, free and informedthought. Lobban has satisfied this, as well.

This Court is satisfied that the parties discussed the transaction before it was reduced towriting. Wilkins could have refused to sign the Contract, and seek independent advice. He did not. Furthermore, he could have producedGordon Berg as a witness. He did not. Furthermore, he received the $5,000 cheque for the deposit and spent it. Had he thought there wasa lease rather than a sale, one would have thought that he might have approached Lobban to discuss this. He did not. He happily tookLobban’s money and spent it. 54.

As in the case before Belzil J, there was no evidence in the case at bar that Wilkins felt anything was amiss with the transaction untilBaillie approached him and suggested that he did not receive enough money for the Subject Property. [55] As a result, this Court finds that Wilkins was not subjected to any undue influence on Lobban’s part. He entered into thetransaction contemplated by the Contract freely and voluntarily. [56] As well, for the reasons set forth in paragraph 2 of its discussion of undue influence, this Court finds that the transactioncontemplated by the Contract was not unconscionable.

Belzil J said the following: It is a fundamental principle of the law of contract that Courts will not inquire into the adequacy of consideration. Thus, a contract,otherwise valid, is not invalid merely because evidence establishes that the property could have been sold for more to a different buyer indifferent circumstances.

In other words, there is no qualitative test for consideration: Chitty on Contracts, at para. 3-013: Hittinger atpara 99. [57] For the foregoing reasons, this Court finds that Wilkins breached the Contract and will be liable to pay the damages that thisCourt will discuss in a moment. [58] Is Baillie liable for inducing Wilkins to breach the Contract? The case that will lead this Court through its analysis is theAlberta Court of Appeal’s decision in 369413 Alberta Ltd v Pocklington, 2000 ABCA 307 [Pocklington].

Fruman JA, for the court, saidthe following: In order to find that a defendant intentionally induced a breach of contract, seven elements must be established:

i) the existence of a contract; ii) knowledge or awareness by the defendant of the contract;

iii) a breach of the contract by a contracting party; iv) the defendant induced the breach;

v) the defendant, by his conduct, intended to cause the breach; vi) the defendant acted without justification; and vii) the plaintiff suffered damages. Pocklington at para 13 . [ 59 ] As discussed previously, the Contract certainly existed and this Court has found that Baillie knew of the Contract. Whether he knew of the exact terms of the Contract is not determinative. Whether the Contract was for a lease or a sale of the Subject Property, mattered not to him. What concerned him was the fact that Lobban intended to use the Subject Property as an airstrip.

To this, Baillie objected. [ 60 ] As discussed above, this Court has found that Wilkins breached the Contract. [ 61 ] This Court also finds that Baillie induced Wilkins to breach the Contract. By Baillie’s testimony, he appeared to want this Court to believe that he was simply assisting Wilkins by taking him to the County’s council meeting, and assisting Wilkins in reaching the objective of not having the subdivision approved so that the sale would not close to ensure that Wilkins was not selling the Subject Property for less than it was worth.

As mentioned earlier, however, this Court finds that Baillie’s testimony was, in the main, self- serving. His goal, this Court holds, was to block the subdivision so that Lobban could not purchase the Subject Property. He did this by “suggesting” to Wilkins that he should withdraw the subdivision application. Wilkins’ testimony confirmed this. As well, during his questioning, the following exchange took place between Lobban’s counsel and Wilkins: Q Okay. Did Mr Baillie tell you to withdraw your application? A He suggested it. Q Let’s look at Document Number 15 of Mr Baillie’s Affidavit of Records.

Can you tell me what that document is? A That’s to withdraw the application for subdivision. Q Did anyone tell you to do that? A It was suggested that I should. Q By who? A Mr Baillie. … Q Let’s look at Document A-17 of my client’s Affidavit of Records. I’ll provide that document. Can you tell me what that document is? A This is a handwritten one of the one’s that’s printed out. [1] Q Okay. So who drafted - - who wrote the letter?

A I think it was Cheryl wrote it. Q Cheryl being? A Cheryl Green. Q And that is Mr Baillie’s common - - A Wife. Q Common law wife? A Yup. … Q I’m sorry, that was two questions in one. One: Who asked her to draft that letter? A Keith probably. Q So Mr Baillie asked Ms Green to draw up that letter for you? A Yup. Q You read it before you signed it? A Yes. Q Did you sign that letter because you were told that $40,000 was not enough for that subdivided piece of land? A Yeah.

Transcript of Questioning of Wilkins, February 11, 2010, p 61, ll 12-22, p 62, ll 13-24, p 63, ll 19-27, p 64, ll 1-2. [ 62 ] From the foregoing, it is clear to this Court that Baillie suggested that Wilkins withdraw the subdivision application, which resulted in Wilkins breaching the Contract. [ 63 ] Did Baillie by his conduct intend to cause Wilkins to breach the Contract?

Fruman JA said the following: [C]ourts soon recognized that intent can also be inferred when the consequences of the conduct were a necessary or reasonably foreseeable result, because “people are presumed to intend the reasonable consequences of their acts” … [L]iability would attach if the defendant’s conduct resulted in the breach of a contract “of which it was or ought to have been aware”.

The intention to bring about a breach of contract need not be the primary object; it is sufficient if the interference is necessarily incidental to attaining the defendant’s primary objective … Intention can also be established when the defendant was reckless or wilfully blind to a breach. The defendant need not have actually known the precise terms of the contract or that his object only could be accomplished through breach of the contract. “If – turning a blind eye – he went about it regardless of whether it would involve a breach, he will be treated just as if he had knowingly procured it”: J.G.

Fleming, The Law of Torts , 8th ed. (Sydney: Law Book Co., 1992) at 694. Turning a blind eye may include situations in which the defendant failed to seek advice or employ the means available to obtain the necessary knowledge. … If the defendant acted under a bona fide belief that contractual rights would not be infringed, liability will not be found even though the

belief turned out to be mistaken. But for a mistaken belief to be bona fide , rather than the result of recklessness or wilful blindness, some basis for the belief must exist, and some reasonable effort must have been made by the defendant to learn the truth. … Pocklington at paras 40-43 [Citations excluded]. [ 64 ] In this case, Baillie’s primary objective was to prevent Lobban from acquiring the Subject Property. Whether he knew that his “suggesting” that Wilkins withdraw the subdivision application would cause Wilkins to breach the Contract matters not, as he was reckless or wilfully blind to the breach.

He could easily have asked Wilkins to show him the Contract to see its terms. Baillie had no bona fide belief that Wilkins’ contractual obligations would not be infringed. How could he? Even if Lobban had leased the Subject Property, and the lease required subdivision approval, he induced Wilkins to breach his contractual obligation, as any other result would have resulted in Lobban using the Subject Property as an airstrip. This Court finds that Baillie, by his conduct, intended to cause Wilkins to breach the Contract. [ 65 ] Was there any justification for Baillie inducing Wilkins to breach the Contract?

Fruman JA said the following: The defence of justification is available when the defendant caused the breach while acting under a duty imposed by law. The issue in each case is whether, upon consideration of the relative significance of all the factors, the defendant’s conduct should be tolerated despite its detrimental effect on the interests of others …: Pocklington at para 57 [Citations excluded]. [ 66 ] Simply stated, Baillie was not acting under any duty imposed by law.

There was no justification for his inducing Wilkins to breach the Contract. [ 67 ] What are the damages for which Wilkins and Baillie are liable.

In Delcor Painting & Flooring Ltd v 20/20 Properties Inc , 2009 ABQB 670 [ Delcor ] at para 41 , Manderscheid J followed Naylor Group Inc v Ellis-Don Construction Ltd , 2001 SCC 58 at para 73 , and held as follows: With respect to entitlement, the fundamental principle of law is that the innocent party is to be placed in as good a position, financially speaking, as it would have been had the contract been performed … [ 68 ] Of course, Lobban must mitigate his losses: Delcor at para 46 . [ 69 ] What is difficult in this case is that Lobban acknowledged that his use of his aircraft was recreational and not occupational.

That fact, however, does not derogate from his having suffered a loss. He has mitigated his damages by acquiring hangar facilities in Grande Prairie. Neither Wilkins nor Baillie presented any evidence that there was land closer to the Subject Property that could have served Lobban’s needs, or challenged the fact that the closest facilities that served those needs were located in Grande Prairie. [ 70 ] Lobban uses his aircraft 2 or 3 times per week.

He is claiming the time it takes for him to travel to and from his residence to Grande Prairie, which he calculated to be approximately 40 kilometres one-way (or 80 kilometres round-trip). This, he calculates his travel time to be about 30 minutes. He is claiming his hourly rate as a mechanic, which is $83 per hour, and he claims his mileage at $1.20 per kilometre. [ 71 ] These claims are unreasonable. No one, as far as this Court is aware, gets paid for their leisure time.

Lobban claims that during those 30 minutes he could be working, but he presented this Court with no evidence that he would be working during his leisure time. As well, $1.20 per kilometre is unreasonable. Not even the government pays that exorbitant amount. This Court awards him one- half that amount, or $0.60 per kilometre. [ 72 ] To place Lobban in as good a position as he would have been had the Contract been performed, this Court awards Lobban damages as against Wilkins and Baillie in the amount of $34,944, based on his travelling to and from Grande Prairie twice per week, at a rate of $0.60 per kilometre.

Granted, this is not based on 3 times per week, but Lobban was not definitive about whether he used his aircraft 2 times or 3 times per week, and he did not take account of the fact that there might have been weeks when he did not use his aircraft at all, due to weather or vacations or the like. To this will be added the $5,000 deposit that he paid to Wilkins, which Wilkins spent, and the $1,300 that he had to pay to the County. As well, he will be entitled to interest at the prescribed rates, and costs on a party- party basis. [ 73 ] Of course, Wilkins’ counterclaim is dismissed in its entirety.

Once Lobban receives payment for the damages that this Court has awarded, he must discharge the certificate of lis pendens he has registered against the Lands. Heard on September 22 and 23, 2014 . Dated at Grande Prairie, Alberta on October 24, 2014 .

K.D. Yamauchi J.C.Q.B.A. Appearances: Murray L Engelking Engelking Wood for the Plaintiff / Defendant by Counterclaim Emmanuel Alade City Law Offices for the Defendant / Plaintiff by Counterclaim Roger Wilkins Soni Nayak Snyder & Associates LLP for the Defendant Keith Baillie To Whom it may concern: I Roger Wilkins, owner of NW¼ Sec 28 TWP 74 RGE 5 W6M wish to cancel the application to subdivide the above land. I do not wish to subdivide. Signed: “Roger Wilkins” Dated: “Aug 8 2007”