11472 Newfoundland v. Labrador Ltd., 2021 NLSC 133

court crest IN THE SUPREME COURT OF NEWFOUNDLAND AND LABRADOR GENERAL DIVISION Citation : 11472 Newfoundland and Labrador Ltd. v. Bluewater Property and Development Inc. , 2021 NLSC 133 Date : October 20, 2021 Docket : 202101G4231 Between: 11472 Newfoundland and Labrador Ltd. Applicant And: Bluewater Property and Development Inc. Respondent Before: Justice Carl R. Thompson Edited Transcript of Oral Reasons for Judgment Place of Hearing: St. John’s, Newfoundland and Labrador Date of Hearing: October 12, 2021 Date of Oral Judgment: October 12, 2021

Summary: A lis pendens is vacated as the subject property to which it attached was not unique or irreplaceable and general damages, not specific performance would be the remedy if successful at trial. Appearances: Ronald A. Cole, Q.C. Appearing on behalf of the Applicant

W. Les Thistle Appearing on behalf of the Respondent Authorities Cited: CASES CONSIDERED: Chaulk v. Fairview Construction (1977), 14 Nfld. & P.E.I.R. 13, 1977 CarswellNfld 12 (C.A.); Semelhago v.Paramadevan, (SCC), [1996] 2 S.C.R. 415; Asamera oil Corp. v. Seal Oil & General Corp., (SCC),[1979] 1 S.C.R. 633; Infini-T Holdings Ltd. v.

Bell Aliant Regional Communications Inc., 2010 NLTD(G) 205; Paro Enterprises v.Murphy, 2015 NLCA 33 REASONS FOR JUDGMENT Thompson, J.: INTRODUCTION [1] This is an Originating Application asking for an Order to vacate a lis pendens filed May 25, 2021 in the Registry of Companiesand Deeds. The Originating Application was issued July 23, 2021.

In another action, a Statement of Claim was recently issued onSeptember 7, 2021 seeking specific performance, special damages and punitive damages in respect to one of the two properties originallysubject of the lis pendens. background [2] 11472 was the land developer for a subdivision in Paradise, NL, consisting of approximately 150 building lots, and Bluewateras a homebuilder. The material supplier to the subdivision was LeDrew Lumber.

In October 2018, Bluewater contracted to purchase 7and 9 Chloe Place, Paradise from 11472. 7 Chloe Place, Paradise closed in August 2019, and 11472 was paid for the building lot at 7Chloe Place. [3] Bluewater started construction on 9 Chloe Place. The closing date was December 31, 2019. Bluewater partially built a houseon 9 Chloe Place.

LeDrew Lumber, advised 11472 that $183,468.97 was owing for materials on 9 Chloe Place. [4] On May 25, 2021 Bluewater filed a lis pendens in respect of lot 9, Chloe Place. [5] For clarification, it is not in issue that this manner of subdivision development, residential construction and ultimate sale to anowner occupier was to have the construction contractor, in this case Bluewater, contract to buy from the subdivision owner developer, inthis case 11472; make a down payment, build the residence (including acquisition of materials), find a residential home purchaser andpay the balance due under the contract with the developer on closing at which time if the supplier of materials (in this case LeDrewLumber), was due funds it was usually then paid by the contractor. issue [6] Bluewater now claims for specific performance in addition to damages in its Statement of Claim of September 7, 2021.

Doesthe record support that 9 Chloe Place is of such a nature as to be unique or irreplaceable and so subject to an Order for specificperformance at trial to support the continuance of the lis pendens? case law [7] In Chaulk v. Fairview Construction (1977), 14 Nfld. & P.E.I.R. 13, 1977 CarswellNfld 12 (C.A.), the Newfoundland Court ofAppeal stated at paragraph 21: 21 … The question here is whether damages would have afforded Chaulk an adequate remedy, and I have no doubt that they could,and would, have. There was nothing whatever unique or irreplaceable about the houses and lots bargained for.

They were merelysubdivision lots with houses, all of the same general design, built on them, which the respondent was purchasing for investment or re-sale purposes only. He had sold the first two almost immediately at a profit, and intended to do the same with the remainder. It would bequite different if we were dealing with a house or houses which were of a particular architectural design, or were situated in a particularlydesirable location, but this was certainly not the case. … [8] In Semelhago v.

Paramadevan, (SCC), [1996] 2 S.C.R. 415, the Supreme Court of Canada in adoptingChaulk stated at paragraph 22: 22. … Specific performance should, therefore, not be granted as a matter of course absent evidence that the property is unique to the extent thatits substitute would not be readily available.

[9] In Asamera oil Corp. v. Seal Oil & General Corp., (SCC), [1979] 1 S.C.R. 633, Estey, J. for the SupremeCourt of Canada stated at page 668: … Before a plaintiff can rely on a claim to specific performance so as to insulate himself from the consequences of failing to procurealternate property in mitigation of his losses, some fair, real, and substantial justification for his claim to performance must be found. … [10] And in Infini-T Holdings Ltd. v.

Bell Aliant Regional Communications Inc., 2010 NLTD(G) 205 LeBlanc, J. of this Court statedat paragraph 19: In this case, there is nothing pleaded either in the Statement of Claim or in the Affidavit filed on behalf of the Plaintiff that could supporta finding that this particular property is of such a nature to the Plaintiff as to be unique or irreplaceable. The property was to be purchasedfor investment and resale purposes only.

I am satisfied in these circumstances that should the Plaintiff succeed in its claim that it has anenforceable contract for the purchase of the property, an appropriate alternate remedy to specific performance will be damages.

Such afinding forecloses, in these full circumstances, the need to keep the lis pendens in place at this time. considerations and conclusions [11] The filing of the Statement of Claim as court file number 2021 01G 4981 on September 7, 2021 in respect of lot 9 Chloe Placerectified the error in not having issued it in this Court prior to filing the Notice of lis pendens in the Registry of Companies and Deeds onMay 25, 2021. The lis pendens and the Court action are now taken to coincide and the notice of it becomes effective as of filing in thisCourt on September 7, 2021 (Paro Enterprises v.

Murphy, 2015 NLCA 33). [12] It is not in issue that lot 9 Chloe Place was one of 150 building lots.

The Originating Application supported by the affidavit ofBarry Durdle sworn July 22, 2021 and filed July 23, 2021, deposes in part at paragraphs 5 and 6: 5. 11472 checked with LeDrew Lumber, the building supplier for the development, and was advised $183,468.97 are owing formaterials alone on 9 Chloe Place, and they were unsuccessful in learning of Clearwater’s intentions to finish the house and pay itscreditors. 11472, after consulting with Ledrews Lumber, concluded Bluewater is financially unable to complete the house and pay theamount owing for the lot and materials n the project.

In particular, to cover its expenses with no allowance for its labour, Bluewaterwould have to sell 9 Chloe Place for approximately $340,000.00. This is extremely unlikely as Bluewater sold joined and near identicalsemi detached unit for $261,061.95 6. In 2021, 11472 took steps to finish the house on 9 Chloe Place, Paradise, so it could recover the sale price of the lot and payLedrews Lumber. When the house was near completion, 11472 learnt that Bluewater had filed a Lis Pendens dated May 14, 2021 andrecorded at RN 977226.

As of the date hereof, 11472 has not been served with a statement of claim and is unaware of any action beingissued by Bluewater against 11472. [13] Notably, his affidavit

Schedule D discloses a sale by Bluewater of the adjoining lot 7 for $261,061.95. This lot was evidencedas one of two coincident contracts between the parties. [14] It appears that the parties are not in agreement on this record as to the stage of completion. The affidavit of Darryl Pearcey,sworn and filed August 13, 2021, deposes at paragraph 6: 6. The Respondent states that the Applicant’s statement the subject property was at a “shelled up” stage is a materialmisrepresentation. Attached hereto as

Schedule “A” are pictures of the subject property from the Respondent’s realtor taken on or aboutMarch 2020 and show the subject property at a very advanced stage of completion. The subject property was at the stage where it wasavailable for sale pending the potential buyer picking out some finishing features.

The Respondent notes that the basement was notcompleted as there were options available to the buyer including having an unfinished basement, finishing the basement themselves,retaining the Respondent to complete the basement, building an apartment in the basement and hiring another contractor to complete thebasement. [15] Notably as well, there is an issue as to whether the Agreement of Sale as between the parties expired according to its terms onDecember 31, 2019 and whether it was extended. [16] The question of the stage of completion and the expiry of the contract would be issues for trial. [17] There is no evidence of the Respondent directed to the uniqueness of the property.

The Brief of the Respondent argues that theproperty is unique because it could be turned into a two-apartment property and be sold or rented for a greater price. The property isamong many in a subdivision of 150 units. The circumstance is as was determined by LeBlanc, J. in Infini-T Holdings Ltd. as referred toby me. [18] Here there is no evidence that the property is irreplaceable or unique.

It was likewise purchased for investment or resale in asubdivision of 150 lots. [19] If the Respondent was successful in its action commenced on September 7, 2021 the appropriate remedy would be damages,not specific performance. Consequently, the basis for continuing this lis pendens is not present. [20] Accordingly, the lis pendens is vacated. [21] The Applicant, 11472 Newfoundland and Labrador Ltd. shall have its costs at Level III of the Scale of Costs.

_____________________________ Carl R. Thompson Justice