T & L Cattle Ltd. v. Khabra, 2020 BCPC 112

Citation: T & L Cattle Ltd. v. Khabra 2020 BCPC 112 Date: 20200423 File No: C-84579 Registry: Surrey IN THE PROVINCIAL COURT OF BRITISH COLUMBIA Small Claims Court BETWEEN: T & L CATTLE LTD. CLAIMANT AND: BALDEV SINGH KHABRA DEFENDANT REASONS FOR JUDGMENT OF THE HONOURABLE JUDGE V. CHETTIAR Counsel for the Claimant: Sean Donaldson Appearing on his own behalf: Baldev Singh Khabra Place of Hearing: Surrey , B.C. Dates of Hearing: January 7 and 8, 2020 Date of Judgment: April 23, 2020

I.

INTRODUCTION [ 1 ] The Claimant, T & L Cattle Ltd., as seller, entered into a Contract of Purchase and Sale dated April 11, 2018 (the “Contract”), with the Defendant, Baldev Singh Khabra, as buyer, for the purchase and sale of the property, an older bungalow on a 0.5-acre parcel of land, located at 13845 40 Avenue, Surrey, British Columbia (the “Property”), at a price of $800,000 (the “Purchase Price”). [ 2 ] The Claimant brings this action to recover $19,892.25 (the “Claimant’s Expenditure”) it paid to construct a well (the “Claimant’s Works”) on the Property, which it says it incurred based on an oral agreement with the Defendant. [ 3 ] The Claimant demanded reimbursement of the Claimant’s Expenditure, but the Defendant refused on the basis that he did not enter into an oral agreement with the Claimant to pay the Claimant’s Expenditure. [ 4 ] In the event the court finds that there was no oral agreement between the parties regarding the Claimant’s Expenditure, the Claimant seeks to recover the Claimant’s Expenditure on a quantum meruit basis, alleging that the Defendant has been unjustly enriched by the Claimant’s Works.

It also seeks interest pursuant to the Court Order Interest Act , [ RSBC 1996] c. 79 , as well as costs and disbursements. [ 5 ] The Defendant denies that he has been unjustly enriched by the Claimant’s Works. He says the Claimant failed to provide a well as represented to him prior to the completion of the Contract. He brings a counterclaim for $34,470 (the “Defendant’s Expenditure”) that he incurred to deepen the well (the “Defendant’s Works”) and to haul water to the Property. He also seeks court fees of $206 and such other relief as the court may deem appropriate. II.

BACKGROUND [ 6 ] The Claimant is a corporation incorporated pursuant to the laws of British Columbia. It operates a dairy farm in Chilliwack, British Columbia. [ 7 ] Mr. Thomas de Groot is the President of the Claimant. [ 8 ] The Defendant is a truck driver. [ 9 ] The Claimant listed the Property for sale in the fall of 2017 through RE/MAX 2000 Realty. [ 10 ] The listing for the Property (the “Listing”) contains the following relevant information:

a) List Date: 9/20/2017

b) Expiry Date: 2/27/2018

c) Original Price: $1,099,000

d) List Price: $899,000

e) Realtor Remarks: It appears the improvements are serviced with well and septic but records are not available at the city. Pre inquiries seem to indicate that the prop[erty] may need to be built up due to prox[imity] to the Nicomekl. A well and new septic are probably required for a larger house. See doc for seller’s ask. A rare find. Old timer cottage on .5 acres zoned A-1 agricultural. The house is in fine liveable condition and is surrounded by working corn and dairy farms. Across the street are very expensive high[-]end properties on the Nicomekl River. A short walk to a marina.

A tranquil spot in South Surrey. An opportune property for creativity. (the “Realtor’s Remarks”) [ 11 ] Mr. Mark Anderson, a realtor and a long-time friend of Mr. de Groot, assisted the Claimant, on a gratuitous basis, to prepare the Contract and the Addendums relating to the purchase and sale of the Property. [ 12 ] The Contract includes the following relevant provisions:

a) Date: April 11, 2018 b) 1. PURCHASE PRICE: $800,000.00 c) 2. DEPOSIT: A deposit of $20,000.00, which will form part of the Purchase Price, will be paid within 24 hours after subject removal. d) 3. TERMS AND CONDITIONS: The purchase and sale of the Property includes the following terms and is subject to the following conditions: Subject to suitable financing being made available to the Buyer on or before May 4, 2018. This condition is for the sole benefit of the Buyer. The Buyer has received a copy of the title and is satisfied with it contains [ sic ], and will be included in the contract of purchase and sale. Buyer is aware that [t]here is no Property Disclosure Statement. . . .

e) 4. COMPLETION: The sale will be completed on June 1, 2018 (Completion Date) at the appropriate Land Title Office. f) 5. POSSESSION: The Buyer will have vacant possession of the Property at 4:00 pm on June 1, 2018 (Possession Date) . . . g) 7.

INCLUDED ITEMS: The Purchase Price includes any buildings, improvements, fixtures, appurtenances and attachments thereto, and all blinds, awnings, screen doors and windows, curtain rods, tracks and valances, fixed mirrors, fixed carpeting, electric, plumbing, heating and air conditioning fixtures and all appurtenances and attachments thereto as viewed by the Buyer at the date of inspection, INCLUDING: Purchase is ‘AS IS WHERE IS’. BUT EXCLUDING: _______________________________________ h) 8.

VIEWED: The Property and all included items will be in substantially the same condition at the Possession Date as when viewed by the Buyer on ___________ yr. _________. i) 16. RISK: All buildings on the Property and all other items included in the purchase and sale will be, and remain, at the risk of the Seller until 12:01 am on the Completion Date. After that time, the Property and all included items will be at the risk of the Buyer. j) 18.

REPRESENTATIONS AND WARRANTIES: There are no representations, warranties, guarantees, promises or agreements other than those set out in this Contract and the representations contained in the Property Disclosure Statement if incorporated into and forming part of this Contract, all of which will survive the completion of the sale. [ 13 ] An Addendum, dated May 7, 2018 (the “May 7 th Addendum”), to amend the Contract contains the following provisions: The Buyer and Seller agree to change the following from May 4 th to May 18 th . 1.

Subject to suitable financing being made available to the Buyer on or before May 4, 2018. This condition is for the sole benefit of the Buyer. All other terms and conditions shall remain the same with time remaining being of the essence. [ 14 ] An Addendum, dated May 17, 2018 (the “May 17 th Addendum”), to amend the Contract contains the following provisions: The Buyer and Seller agree to change the following from May 18, 2018 to May 24, 2018. 1. Subject to suitable financing being made available to the Buyer on or before May 18, 2018. This condition is for the sole benefit of the Buyer.

All other terms and conditions shall remain the same with time remaining being of the essence. [ 15 ] On or about May 22, 2018, the Claimant obtained an estimate of $21,265 from A & H Drilling Ltd. (“A & H”) for the drilling and casing of a six-inch well, screened and developed to a depth of approximately 300 feet. [ 16 ] A & H started work on the Property on May 23, 2018, and, at the Claimant’s request, stopped work on May 25, 2018. [ 17 ] An Addendum, dated May 24, 2018 (the “May 24 th Addendum”), to amend the Contract contains the following provisions: The Buyer, Baldev Khabra agrees to pay for the cost of drilling the well.

See attached quote from: A&H Drilling Ltd. 48987 Chilliwack Central Road Chilliwack, BC V2P 6H3 604-794-5544 ALL OTHER TERMS AND CONDITIONS SHALL REMAIN THE SAME.

TIME CONTINUES TO BE OF THE ESSENCE. [ 18 ] On May 24, 2018, the Defendant removed the subject clause and paid the $20,000 deposit, as required under the Contract. [ 19 ] A & H’s receipt, dated June 7, 2018, indicates that the Claimant paid a deposit of $6,000 and a further payment of $13,892.25, totalling $19,892.25, for A & H’s work on the Property. [ 20 ] On or about June 8, 2018, the Defendant obtained an estimate of $30,460 from A & H for deepening the six-inch well from 295 feet to a depth of approximately 495 feet. [ 21 ] On or about August 2, 2018, the Claimant, through its lawyers, made a demand for reimbursement of the Claimant’s Expenditure. [ 22 ] A & H started deepening the well on the Property on August 22, 2018, and ended it on August 24, 2018. [ 23 ] A & H’s Well Record, dated August 24, 2018, contains the following remarks:

Drilled to 500 feet. Pulled casing back to 400 feet and back filled with pea gravel from 460 feet to 294 feet.

The geological formations encountered during drilling would not produce sufficient water to supply a well. [24] A & H’s invoice, dated August 24, 2018, in the amount of $18,354, indicates the work done as “deepening one 6 inch well from295 to a depth of 500 feet & pulled casing back to 294 feet.” [25] A & H’s statement, dated September 1, 2018, shows that the Defendant paid the estimate of $30,460 on August 17, 2018, and A& H refunded the balance of $12,106 ($30,460 less $18,354) to the Defendant on September 1, 2018. [26] A month or so after installing the Defendant’s Works, the Defendant engaged Caliber Water Services (“Caliber”) to installpumps and pipes in an effort to get water from the well, for which the Defendant incurred a cost of $1,116.

III. ISSUES [27] The issues to be determined in this case are as follows: 1. Did the Listing or any oral representations the Claimant may have made to the Defendant form part of the Contract, therebyobligating the Claimant to provide a well that supplies water to the Property? 2. Was there an oral agreement between the parties regarding the payment of the Claimant’s Expenditure? 3. Did the Purchase Price include the Claimant’s Works? 4. Is the Claimant entitled to recover the Claimant’s Expenditure on a quantum meruit basis? IV.

DISCUSSION Applicable Law [28] The Claimant’s counsel submitted two cases: Pacific National Investments Ltd. v. Corporation of the City of Victoria, 2004 SCC75 , regarding the doctrine of unjust enrichment, and Pine Drilling Ltd. v. Ward, 2000 BCPC 136 , in which theclaimant was successful, subject to certain set-offs, in its claim based on unjust enrichment for drilling a water well on the defendant’sproperty. The Defendant did not submit any case law. [29] For purposes of analysis, I will refer to some case law that discusses the legal principles that are relevant to the issues beforeme.

Burden of Proof [30] In civil cases there is only one standard of proof, and that is proof on a balance of probabilities. In all civil cases, the trial judgemust scrutinize the relevant evidence with care to determine whether it is more likely than not that an alleged event occurred: F.H. v.McDougall, 2008 SCC 53, at para. 49. [31] In the case before me, the Claimant must prove its claim, and the Defendant must prove his counterclaim, on a balance ofprobabilities. Contract Principles [32] The court in Le Soleil Hotel & Suites Ltd. v.

Le Soleil Management Inc., 2009 BCSC 1303, provided a comprehensivediscussion of several fundamental principles of contract law. I will set out those principles relevant to the issues before me and applythem to the facts I find. Liability [321] Courts strive to uphold contractual obligations solemnly and freely undertaken. They do not, however, impose them upon partieswho have not reached agreement on all essential terms: . . . [322] For parties to be bound in a contractual relationship there must be a manifest meeting of the minds.

They must expressthemselves outwardly in a manner that indicates both an intention to be bound and reasonably certain mutually agreed terms: . . . [323] These fundamental principles of contract law enable commercial life to operate in a fair, predictable and efficient manner. Theyapply whether the purported contract in question is concluded in writing, orally, by conduct, or by a combination thereof. The keyquestion in all cases is whether an agreement has been reached on all essential terms, regardless of its form: . . .

Intention to Create Legal Relations [324] The test for determining the intention to create legal relations is objective. It is explained by G.H.L. Fridman in The Law ofContract, 5th ed. (Toronto: Thomson Carswell, 2006) as follows: Constantly reiterated in the judgments is the idea that the test of agreement for legal purposes is whether the parties have indicated to theoutside world, in the form of the objective reasonable bystander, their intention to contract and the terms of such contract. The law is notconcerned with the parties’ intentions but with their manifested intentions.

It is not whether or not what an individual party believed orunderstood was the meaning of what the other party said or did that is the criterion of the agreement; it is whether a reasonable man inthe situation of that party would have believed and understood that the other party was consenting to the identical terms.

[325] The objective test serves the main purpose of contract law: to protect reasonable expectations created by promises.

Accordingly,“the test of whether a promise is made, or of whether assent is manifested to a bargain, does not and should not depend on an enquiryinto the actual state of mind of the promisor, but on how the promisor’s conduct would strike a reasonable person in the position of thepromisee”: . . . [326] If the parties have reduced the alleged agreement to writing, the starting point for analysis is the wording of the document itself.The words used should be given their plain, literal and ordinary meaning, unless absurdity would result, and the contract should beconstrued in context and as a whole: . . . [327] If the parties’ intent is not clear from the words of a written agreement, extrinsic evidence may be considered to assist ininterpreting the arrangement or to explain, without contradicting, the language of the contract.

As a last resort, the principle of contraproferentem may be applied to construe an ambiguity against the contract’s drafter if the non-drafting party had no meaningfulopportunity to negotiate its terms: . . . [328] The

interpretation of oral contracts turns on the same essential principles: . . . If the alleged agreement has not been reduced towriting, the Court must consider what the parties said and did and assess objectively whether, in context, their words and actionsestablish an intention to be bound: . . .

The genesis and aim of the transaction is an aspect of the relevant context for consideration: . . .The credibility of witnesses will be particularly important and differing versions of events will increase the difficulty of establishing thatan enforceable bargain was made: . . . [332] If agreement on all essential terms is established, on occasion the law will permit certain terms to be implied to give businessefficacy to the bargain: . . . . For example, in . . . a case involving an agreement to lease, the Court implied terms such as the dates forpayment of rent.

A term should not be implied, however, unless it is necessary: . . . . In addition, no term should be implied where itwould have the effect of rewriting the bargain or contradicting its other terms: . . . . [334] In order to determine whether a binding contract was created the Court may consider both the parties’ conduct leading up to andfollowing conclusion of the alleged agreement. . . . Certainty of Terms [339] The Court cannot enforce an apparent bargain if its terms are unclear: . . .

This is so because it cannot be said that the partiescame to a meeting of the minds where the terms of the alleged agreement are vague, ambiguous or incomplete: Klemke, supra. AsViscount Maughm explained in G. Scammell & Nephew Ltd. v. Ouston, [1941] A.C. 251 (H.L.): In order to constitute a valid contract the parties must so express themselves that their meaning can be determined with a reasonabledegree of certainty.

It is plain that unless this can be done it would be impossible to hold that the contracting parties had the sameintention; in other words, the consensus ad idem would be a matter of mere conjecture. Unjust Enrichment [33] In Pacific National, the Supreme Court of Canada, discussed the doctrine of unjust enrichment: 13 The doctrine of unjust enrichment provides an equitable cause of action that retains a large measure of remedial flexibility to dealwith different circumstances according to principles rooted in fairness and good conscience.

This is not to say that it is a form of “‘palmtree’ justice” (Peel (Regional Municipality) v. Canada, (SCC), [1992] 3 S.C.R. 762, at p. 802) that varies with thetemperament of the sitting judges. On the contrary, as the Court recently reaffirmed in Garland v. Consumers’ Gas Co., [2004] 1 S.C.R.629, 2004 SCC 25, a court is to follow an established approach to unjust enrichment predicated on clearly defined principles. However,their application should not be mechanical.

Iacobucci J. observed that “this is an equitable remedy that will necessarily involve discretionand questions of fairness” (para. 44). 14 As accepted by the courts in British Columbia, the test for unjust enrichment has three elements: (1) an enrichment of thedefendant; (2) a corresponding deprivation of the plaintiff; and (3) an absence of juristic reason for the enrichment (Rathwell v. Rathwell, (SCC), [1978] 2 S.C.R. 436, at p. 455; Pettkus v. Becker, (SCC), [1980] 2 S.C.R. 834, at p. 848; Peter v.Beblow, (SCC), [1993] 1 S.C.R. 980, at p. 987; Peel, supra, at p. 784; Garland, supra, at para. 30). A.

Was There Enrichment of the City? 15 The existence of an enrichment to the defendant is governed by “a straightforward economic approach” (Peter, supra, at p. 990).An enrichment may “connot[e] a tangible benefit” (Peel, supra, at p. 790), or it can be relief from a “negative”, such as saving thedefendant from an expense he or she would otherwise have been required to make. B. Did the Appellant Suffer a Corresponding Deprivation? 20 Using the straightforward economic approach, the appellant suffered a corresponding deprivation of $1.08 million. . . . No otherperson or entity contributed to the enrichment.

In these circumstances, as Cory J. put it in Peter, supra, at p. 1012, “I would have thoughtthat if there is enrichment, that it would almost invariably follow that there is a corresponding deprivation suffered by the person whoprovided the enrichment.” C. Is There a Juristic Reason to Deny Recovery to the Appellant? 22 This branch of the test for unjust enrichment is pivotal, for as McLachlin J. observed in Peter, supra, at p. 990: It is at this stage that the court must consider whether the enrichment and detriment, morally neutral in themselves, are “unjust”.

23 The use of the expression “juristic reason” in this connection emphasizes that “unjust” is to be addressed as a matter of law and legal reasoning rather than a free-floating conscience that may risk being overly subjective; see L. Smith, “The Mystery of ‘Juristic Reason’” (2000), 12 S.C.L.R. (2d) 211, at p. 219 . This third step has to some extent been redefined and reformulated in Garland , supra , at paras. 44-46 . There are now two stages to the juristic reason inquiry.

At the first stage, a claimant (here the appellant) must show that there is no juristic reason within the established categories that would deny it recovery. The established categories are the existence of a contract, disposition of law, donative intent, and “other valid common law, equitable or statutory obligatio[n]” ( Garland , at para. 44 ). The categories may be added to over time (para. 46). On proving that none of these limited categorical reasons exist to deny recovery, the plaintiff (here the appellant) will have made out a prima facie case of unjust enrichment.

It will have demonstrated “a positive reason for reversing the defendant’s enrichment” ( Smith , supra , at p. 244). 24 Although this formulation requires the plaintiff to prove a negative, the task is made manageable by the limited number of categories, and it is only fair to put on the claimant the onus of proving the essential elements of its cause of action. 25 At the second stage, the onus shifts to the defendant (here the respondent City), who must rebut the prima facie case by showing that there is some other valid reason to deny recovery.

In the absence of a convincing rebuttal, the transfer of wealth will be reversed. According to Garland , it is at this stage that the court should have regard to the reasonable expectation of the parties and public policy considerations. However, as Iacobucci J. added, at para. 46: The point here is that this area is an evolving one and that further cases will add additional refinements and developments. Evidence [ 34 ] Mr. de Groot and Mr. Anderson testified on behalf of the Claimant. Mrs. Khabra testified on behalf of the Defendant. The Defendant also testified.

Various documents were entered into evidence. [ 35 ] I will first summarize the evidence, including the circumstances leading up to the signing of the Contract and the completion of the purchase and sale of the Property, to facilitate the discussion of the issues. Mr. de Groot’s and Mr.

Anderson’s evidence [ 36 ] The Claimant acquired the Property in or around September 2017 for Mr. de Groot’s daughter, but because she did not move into it, the Claimant listed the Property for sale on September 20, 2017. [ 37 ] Mr. de Groot resides in Rosedale, east of Chilliwack, British Columbia, but the Property is located in Surrey, British Columbia. He was not familiar with the area where the Property was located, and did not inspect it before it was listed for sale.

At the Claimant’s realtor’s suggestion, the Property was initially listed for $1,099,000. [ 38 ] Regarding the Realtor’s Remarks in the Listing, Mr. de Groot presumed that the Property had water and everything was working in the house, and he did not look into it. [ 39 ] When the Property was first listed, Mr. de Groot thought that there was a water well on the Property, but after about two months, he learned from the Property’s previous owners that there was no well, and that the previous owners got their water from a well located on a parcel of land across the street from the Property.

The Property, which is a 0.5-acre parcel, is a portion of a larger 200-acre parcel of land with different titles. [ 40 ] Because there was no water source on the Property, Mr. de Groot instructed the realtor to take it off the market. He said, “I can’t market something that doesn’t have water.” However, he allowed the Property to be marketed until the Listing expired on February 27, 2018 (for slightly over three months when he knew there was no water source on the Property). [ 41 ] The Listing shows that the price was reduced from $1,099,000 to $899,000.

However, Mr. de Groot could not recall if the price was reduced. This is troubling, because the price could not have been reduced without his instructions or approval. [ 42 ] Near the end of February 2018, Mr. de Groot received a couple of phone messages from the Defendant to call him. Neither the Claimant’s realtor nor the Defendant’s realtor called Mr. de Groot. [ 43 ] Mr. de Groot returned the Defendant’s calls. The Defendant asked Mr. de Groot if the Claimant was still interested in selling the Property.

Mr. de Groot explained to the Defendant that the Property had no water and that “he had to fix it up or do something.” Mr. de Groot asked the Defendant if he had looked at the Property with his realtor, to which the Defendant said, “No.” Mr. de Groot told the Defendant that a few things, including the water and septic, had to be checked out and fixed on the Property. He told the Defendant that he would then put a price on it, and that he did not want to sell the Property the way it was.

The Defendant told Mr. de Groot that he would talk it over (I assume with his family). [ 44 ] When looking into the water issue, Mr. de Groot learned that it would be easier to put in a well on the Property, rather than making a deal to get water from the well that was located on another parcel of land across the street. [ 45 ] Sometime in February or March 2018, Mr. de Groot’s son contacted A & H about drilling a well on the Property. [ 46 ] Mr. de Groot looked at the Property with the Defendant sometime in March 2018, and, at that point, the parties agreed to the purchase and sale. [ 47 ] Mr. de Groot initially told the Defendant that the purchase price was $900,000, on an “as is where is” basis, and that he did not want to sit and wait for the Defendant to get financing, because he did not want to be going back and forth from Rosedale to Surrey.

The Defendant told Mr. de Groot that he would be able to close right away.

[ 48 ] Prior to signing the Contract on April 11, 2018, the Defendant called Mr. de Groot a number of times to see if Mr. de Groot would reduce the price. Mr. de Groot told him that he would not, and that he needed to “fix up” the Property. [ 49 ] However, because of the Defendant’s persistence, one day, when Mr. de Groot was working late on the farm, he agreed to a “take it or leave it” price of $800,000. [ 50 ] Mr. de Groot said that at no point did he indicate to the Defendant that there was a well, or that he would put in a well, on the Property.

He said the Defendant had gone to the City on his own to see if he could get water to the Property, and that the Defendant told Mr. de Groot that the Defendant had talked to other people about getting a well. [ 51 ] Mr. de Groot said, “If I had the water thing figured out, I could have gotten quite a bit more money for the Property.” [ 52 ] Mr. de Groot and the Defendant had scheduled a couple of meetings to sign the Contract, but Mrs. Khabra cancelled them because the Defendant had to go to the hospital, as he had suffered a stroke.

Therefore, a further meeting was scheduled to sign the Contract. [ 53 ] At Mr. de Groot’s request, sometime in March 2018, Mr. Anderson prepared the Contract, which was in the standard form Contract of Purchase and Sale, published by the BC Real Estate Association and the Canadian Bar Association (BC Branch). [ 54 ] Mr. Anderson explained that he agreed to draft the Contract, but he did not act for either of the parties. He had never been to the Property. Mr. de Groot told Mr.

Anderson what he wanted in the Contract, such as the parties’ names, price, amount of the deposit, the financing condition, and subject removal date. Mr. de Groot also told Mr. Anderson that the buyer was purchasing the Property “as is”. Therefore, Mr. Anderson added the notation, “Purchase is ‘AS IS WHERE IS’”, which he explained was the typical terminology realtors use in real estate contracts under these circumstances. [ 55 ] Mr. Anderson was present when the parties met at Mr. de Groot’s residence on April 11, 2018 to sign the Contract. The Defendant and his wife, and Mr. de Groot and his wife were present.

At this meeting, there was no discussion about the well or any other issues regarding the Property. [ 56 ] The Contract contained a “subject to financing” clause, which initially read “on or before April 25, 2018,” but that was crossed out and changed to May 4, 2018.

In this respect, Mr. de Groot told the Defendant that because the Listing had expired, he did not want to sit and wait for the Defendant to arrange financing, to which the Defendant said, “No problem, buddy.” [ 57 ] With respect to the notation, “Purchase is ‘AS IS WHERE IS’”, in clause 7 of the Contract, Mr. de Groot understood it to mean that “the Property had no water, and septic had to be dealt with.” [ 58 ] Regarding the May 7 th Addendum, although Mr. de Groot does not recall seeing or signing it, Mr.

Anderson said Mr. de Groot asked him to draft it so that the Defendant could have more time to secure financing. Mr. Anderson did not witness the signing of this Addendum. Mr. de Groot also does not recall receiving a signed copy from the Defendant. [ 59 ] It appears that the parties did not sign the May 7 th Addendum, as only an unsigned copy was entered into evidence. I also note that this Addendum was not prepared prior to the expiry of the subject clause on May 4, 2018.

However, the parties proceeded on the basis that it was an effective document amending the Contract. [ 60 ] There was another request to extend the time for the Defendant to secure financing. Therefore, Mr. Anderson drafted the May 17 th Addendum and forwarded it to Mr. de Groot to sign by electronic means, as Mr. de Groot was out of town at that time.

The parties signed this Addendum, but Mr. de Groot never received a fully signed copy of this Addendum. [ 61 ] On Mr. de Groot’s drive back from the Vancouver airport on May 18, 2018 (the Friday after the May 17 th Addendum was signed), the Defendant called and told him that the Defendant had approached six lenders, but was having difficulty securing financing because there was no water on the Property, and asked whether the Claimant would reduce the price further to help him out (the “May 18 th Conversation”). [ 62 ] Mr. de Groot said, “we had quite a conversation.” He asked the Defendant why he wasted Mr. de Groot’s time for the past two months if he was not able to get financing, and told him that Mr. de Groot could have been “doing other stuff.” [ 63 ] After the May 18 th Conversation, Mr. de Groot did not believe that the Defendant would close the deal, because the Defendant told Mr. de Groot that “he could not do it – close the deal.” Because the Claimant had already given two extensions for the Defendant to secure financing, and the Defendant said that “he could not do it,” Mr. de Groot concluded that “he would clean up the Property, get a well in there, and resell it.” [ 64 ] Therefore, Mr. de Groot, through one of his contacts, got an estimate from A & H on May 22, 2018 to drill a well on the Property.

A & H started work on May 23, 2018. [ 65 ] Mr. Anderson testified that a day or two before the subject removal date of May 24, 2018, he got a call from the Defendant’s lender that the financing was approved and the Defendant would be removing the subject clause. [ 66 ] Mr. Anderson called Mr. de Groot right away and told him that the Defendant’s financing was approved and that the Defendant was going to remove the subject clause. Mr.

Anderson said, at first, Mr. de Groot was not happy to hear this information, as he was of the understanding that the Defendant was unable to get financing, and that is why Mr. de Groot started the work on the well in preparation for the next sale. Mr. Anderson had no further communication with Mr. de Groot or anyone else regarding this matter. [ 67 ] Mr. de Groot said, all of a sudden, after the work on the well had started, the Defendant called him on May 23, 2018 to say that

he would complete the purchase. Mr. de Groot asked the Defendant if the Claimant should stop the work on the well, to which the Defendant said, “no, it’s good, because I need the well anyways.” Mr. de Groot asked the Defendant again whether he was going to complete the purchase and whether he would pay for the well, to which the Defendant said, yes, because he needs it anyways and that he will pay for it (the “May 23 rd Conversation”). [ 68 ] Mr. de Groot talked to the Defendant again on the afternoon of May 23, 2018 to reconfirm, and the Defendant again said that he would pay for the well.

Mr. de Groot told the Defendant that he would send something in writing to confirm that the Defendant would take over the cost of the well. [ 69 ] In this respect, Mr. de Groot had Mr. Anderson prepare the May 24 th Addendum, attaching A & H’s May 22, 2018 estimate. This was sent to the Defendant for signature, but the Defendant did not sign it. [ 70 ] That was the last communication Mr. de Groot had with the Defendant. Mr. de Groot tried to contact the Defendant to get some direction on A & H’s questions regarding the water supply to the house, but the Defendant did not respond.

Therefore, Mr. de Groot instructed A & H to stop work, and they did on May 25, 2018. [ 71 ] On May 24, 2018, the Claimant’s lawyers received from the Defendant the deposit of $20,000, and the purchase and sale completed on June 1, 2018, with the Defendant paying the balance of the Purchase Price. [ 72 ] Mr. de Groot said the reason the Defendant decided to complete was because the Defendant saw the Claimant putting in the well.

This is inconsistent with Mr. de Groot’s earlier evidence that the Defendant told him that he could not complete because he was unable to secure financing. [ 73 ] As at June 1, 2018, the Claimant’s Works remained on the Property. The Claimant did not remove any of the casing or fill in the hole that was drilled. The Defendant’s and Mrs. Khabra’s evidence [ 74 ] The Defendant’s realtor showed the Property to the Defendant and Mrs. Khabra sometime in February 2018. They do not remember the exact date. [ 75 ] After a week or so, the Defendant spoke with his realtor and was told that the Listing had expired.

The Defendant got Mr. de Groot’s contact number from the realtor and contacted Mr. de Groot directly. He asked Mr. de Groot whether the Property was still for sale, as indicated on the Listing, to which Mr. de Groot said, yes. The Defendant asked whether his realtor could deal with Mr. de Groot, but Mr. de Groot said, no, because he did not want to pay any realtor’s commission. [ 76 ] The Defendant and Mrs. Khabra met Mr. de Groot at the Property. The Defendant asked Mr. de Groot whether the sale of the Property would be as indicated on the Listing, to which Mr. de Groot said, yes.

Based on this discussion, the Defendant understood that the Property included the well and the septic services, as indicated in the Listing. [ 77 ] A few days later, the parties agreed to the purchase and sale. [ 78 ] At the end of March 2018 or beginning of April 2018, the Defendant fell ill, and was off work for approximately one month.

However, the parties arranged to meet at Mr. de Groot’s residence on April 11, 2018 to sign the Contract. [ 79 ] On May 22 or 23, 2018, the Defendant called Mr. de Groot and told him that he was going to remove the subject clause, as his financing had been approved. [ 80 ] When asked whether there was ever any discussion between him and Mr. de Groot regarding payment for the well, the Defendant said, no.

He said in a phone call with Mr. de Groot (although he could not remember the exact date), Mr. de Groot told the Defendant that the Claimant was putting in a well, to which the Defendant said, “Okay, get it done please; I need the well.” [ 81 ] The Defendant was adamant that he never agreed to pay for the well. He said, as it was, he had difficulty arranging financing for the purchase of the Property, and there was no way that he would have agreed to pay any additional amount for the well.

Even for the cost of deepening the well, he had to borrow money from his son to pay A & H. [ 82 ] The Defendant said he was always of the understanding that he was to get the well and water along with the Property, as advertised, because Mr. de Groot told him that the sale of the Property would be as indicated on the Listing.

However, as soon as he removed the subject clause and paid the deposit, the Claimant stopped work on the well. [ 83 ] In spite of the dispute with the well, the parties completed the purchase and sale on June 1, 2018. [ 84 ] Because there was no water supply to the Property, the Defendant contacted A & H, as they had already started drilling the well on the Property. A & H wanted more than $30,000 to do further work on the well.

The Defendant borrowed funds from his son and paid A & H to continue work on the well, as he was desperate to get water to the Property. [ 85 ] A & H’s further work on the well, between August 22 and 24, 2018, did not produce any water.

A & H concluded that “the geological formations encountered during drilling would not produce sufficient water to supply a well.” [ 86 ] About a month or so after A & H’s work, the Defendant engaged Caliber to see if any water could be pumped from the well, but that effort was unsuccessful as well. [ 87 ] Since there is no water supply to the Property, the Defendant has to get potable and non-potable water from other sources. He bought a potable water tank and a mobile water tank, and uses his truck to haul water every day, or every other day.

[ 88 ] The Defendant, Mrs. Khabra and their son live on the Property. The Defendant suffers from some health conditions. The lack of water supply to the Property has been a huge hardship on him and his family from a financial and emotional standpoint. They have been suffering. [ 89 ] Mrs. Khabra’s evidence was consistent with that of the Defendant. Mrs. Khabra viewed the Property with the Defendant and their realtor sometime at the end of February 2018. Her understanding was that the Property came with well and septic services, as indicated on the Listing.

There was no discussion with their realtor regarding water supply to the Property. The house on the Property was old, so they assumed that there had to be water on the Property, and that they did not think about it at all. Also, they were not planning on building a bigger house, so they did “not need a bigger well or anything.” She said there was never any discussion about them having to pay for the water. [ 90 ] Mrs.

Khabra acknowledged seeing the May 7 th and May 17 th Addendums, but not the May 24 th Addendum regarding payment for the well. [ 91 ] She said she cannot bear to see her husband (the Defendant), at his age and with his health conditions, work so hard, to get water for the family to survive. The Defendant has to go every day, after work, sometimes in the dark and the cold, to get water from the water station, and they have to pay for that water. She has to run to get 18-litre bottles for drinking water. She also has health issues, including a stroke that she suffered.

She relies on the employees at the store to help her load the water. She cannot do laundry if there is no water. She has to wait until the Defendant brings water.

She said she and her family are going through a terrible life because of the difficult water situation at the Property. [ 92 ] Under cross-examination, t he Defendant admitted that: • he knew that there was no well on the Property at the time of signing the Contract; • clause 7 of the Contract states the purchase is “as is where is,” but he understood that to mean that the Property would be as it was described on the Listing; • the Contract does not provide that the Claimant will provide a well or water before completion of the purchase and sale; and • clause 18 of the Contract provides that there are no representations, warranties, guarantees, promises or agreements other than those set out in the Contract. [ 93 ] When questioned whether the Defendant relied on the May 7 th Addendum as part of the Contract, the Defendant said, yes, and that he thought he had a signed copy, but he could not find it.

He said his bank needed the extension, and he thought they had sent it to the Claimant’s realtor. [ 94 ] The Claimant argued that the Defendant relied on the unsigned May 7 th Addendum because it benefitted him by giving him more time to secure financing. [ 95 ] I note that the Claimant did not raise any issue about the May 7 th Addendum at that time. Both parties relied on it, and amended the Contract further by signing the May 17 th Addendum.

They completed the purchase and sale based on these Addendums. [ 96 ] The evidence indicates that both parties were anxious to complete the purchase and sale, as they seemed to have overlooked a few irregularities in their desire to complete the purchase and sale. For example, there were a few clauses in the Contract, including clause 24 (Offer) and clause 25 (Acceptance), that were not properly completed or executed. As I already noted, the May 7 th Addendum was not prepared and signed before the expiry of the subject clause on May 4, 2018. The May 17 th Addendum was not properly witnessed.

The Claimant completed the purchase and sale even though the Defendant did not sign the May 24 th Addendum. Analysis 1.

Did the Listing or any oral representations the Claimant may have made to the Defendant form part of the Contract, thereby obligating the Claimant to provide a well that supplies water to the Property? [ 97 ] The Claimant submits that the Listing does not form part of the Contract, and that the Claimant did not make any oral representations about providing a well, and even if it did, they do not form part of the Contract in light of clause 18 of the Contract, which specifically excludes any representations not specifically set out in the Contract.

There are no representations in the Contract regarding a well or provision of water to the Property. Therefore, the Claimant submits, it is not obligated to provide a well that supplies water to the Property. [ 98 ] The Defendant, on the other hand, submits that he purchased the Property relying on the Listing and the Claimant’s representation that the Property was being sold, as described in the Listing, which suggested that well and septic services were included. [ 99 ] The Defendant appears to be content with using the existing septic tank on the Property.

His issue is with the well and the water supply to the Property. [ 100 ] More often than not, buyers of residential real property, do not seek legal assistance before signing on the dotted line, committing themselves to, in many cases, one of the largest purchases they will ever make in their lifetimes. The Defendant appears to have fallen into this category of buyers as well, as what he thought he was purchasing is not reflected in the Contract that he signed. [ 101 ] Nowhere in the Contract is there any term that specifies that the Claimant must provide a well that supplies water to the Property.

[102] There is no reference in the Contract that incorporates any representations made in the Listing. The Listing had expired wellbefore the Contract was signed. Regarding any representations that Mr. de Groot may have made to the Defendant regarding the well orwater supply cannot be relied upon by the Defendant, as clause 18 of the Contract provides that there are no representations, warranties,guarantees, promises or agreements other than those set out in the Contract. [103] Clause 18 of the standard form Contract of Purchase and Sale is aimed at protecting the seller and the buyer.

The first part statesthat anything that may have been said about the state of the improvements or the property, but which is not written in the purchasecontract, will have no effect on the purchase and sale. Therefore, unless there is fraud (or possibly recklessness) involved, comments bythe realtor or the seller about, for example, the state of any of the improvements or the property, will not bind the seller.

On the otherhand, representations and warranties included in the purchase contract, such as those in a Property Disclosure Statement, and are stated toform part of the purchase contract, will bind the seller, and will continue to bind the seller after closing. [104] In this case, there was no Property Disclosure Statement or any other statement (including any statements from the Listing) thatwere incorporated into and formed part of the Contract. [105] There are no allegations of fraud or recklessness on the part of the Claimant.

The evidence is clear that Mr. de Groot told theDefendant early on in their negotiation that there was no well on the Property. The Defendant admitted that he knew, before signing theContract, that there was no well on the Property. If he wanted the Claimant to provide a well, he should have included a term to thateffect, in writing, in the Contract. But he did not.

Therefore, he cannot now assert that he relied on the wording in the Listing or on otherverbal assurances from Mr. de Groot. [106] On the evidence before me, I find that neither the Listing nor any oral representations that the Claimant may have made to theDefendant formed part of the Contract, thereby obligating the Claimant to provide a well that supplies water to the Property. [107] It follows that the Claimant cannot be held liable for the Defendant’s Expenditure in installing the Defendant’s Works andhauling water to the Property.

While it is unfortunate that the Defendant has been put to the Defendant’s Expenditure, and the Defendantand his family are suffering as a result of the unfortunate consequences of the Defendant’s lack of diligence in adequately addressing thewell and the water issue in the Contract, there is no basis at law for the Defendant to succeed in his counterclaim. [108] It is worth reminding buyers of real property that they must always bear in mind the doctrine of caveat emptor or “let the buyerbeware.” This doctrine is based on the notion that a purchaser must fend for themselves, seeking protection by express warranty from theseller or by independent examination of the premises, failing which, they may be left without remedy either at law or in equity, in theabsence of fraud or fundamental difference between that which was bargained for and that obtained: Fraser-Reid v.

Droumtsekas, (SCC), [1980] 1 S.C.R. 720, at p. 723. 2. Was there an oral agreement between the parties regarding the payment of the Claimant’s Expenditure? [109] The Claimant submits that the parties made an oral agreement during the May 23rd Conversation, wherein the Defendant toldMr. de Groot to continue with the construction of the well because he needs it, and that he would pay for it.

It says it relied on thisagreement and continued with the construction of the well, as there was a pattern of the parties following through with oral agreements, such as the May 7th Addendum that was not signed, but the parties relied on it anyways. [110] The Defendant vehemently denies that he entered into an oral agreement to pay the Claimant’s Expenditure. [111] For parties to be bound in a contractual relationship, whether in writing or otherwise, there must be a manifest meeting of theminds.

They must express themselves outwardly in a manner that indicates both an intention to be bound and reasonably certain mutuallyagreed terms. The key question in all cases is whether an agreement has been reached on all essential terms, regardless of its form. Thelaw is not concerned with the parties’ intentions but with their manifested intentions.

It is not whether or not what an individual partybelieved or understood was the meaning of what the other party said or did that is the criterion of the agreement, but it is whether areasonable person in the situation of that party would have believed and understood that the other party was consenting to the identicalterms. [112] In this case, the evidence of Mr. de Groot and the Defendant regarding whether or not there was an oral agreement relating tothe payment of the Claimant’s Expenditure is diametrically opposite.

Mr. de Groot says the Defendant agreed to pay for the well inaddition to the Purchase Price, whereas the Defendant categorically denies that assertion, and states that he was already struggling tosecure financing for the Purchase Price and that he would not, and could not, have made such an agreement. Mrs. Khabra’s evidence wasconsistent with that of the Defendant in this respect. [113] One of the essential terms of this alleged oral agreement is the cost of the well. There is no evidence to indicate that the parties discussed the cost in the May 23rd Conversation.

It was only with the May 24th Addendum that A & H’s May 22, 2018 estimate wasattached and sent to the Defendant for signature, which the Defendant rejected and did not sign. The Defendant also did not respond to Mr. de Groot’s telephone calls after the May 23rd Conversation. Therefore, there was no discussion or agreement between the parties onthe cost, either orally or in writing. [114] Clearly, there was no meeting of minds between the parties, and there was no agreement on all essential terms.

Therefore, I findthat there was no oral agreement between the parties regarding the payment of the Claimant’s Expenditure. 3. Did the Purchase Price include the Claimant’s Works? [115] While I have concluded that the Contract did not contain any specific term obligating the Claimant to provide a well thatsupplies water to the Property, the question as to whether the Purchase Price included the Claimant’s Works involves a different inquiry. [116] The evidence clearly indicates that there were issues with the Property regarding the well and septic services. The house on the

Property was described as an “old timer.” Mr. de Groot nor his daughter lived on the Property. The Claimant bought the Property inSeptember 2017, and within a month, relisted it for sale on September 20, 2017. There is no doubt that the Claimant was anxious to sellthe Property. [117] It is obvious that the Claimant did not want to provide any warranties or guarantees regarding any aspect of the Property. That isperhaps why Mr. de Groot instructed Mr. Anderson that the purchase and sale was on an “as is” basis.

There was no Property DisclosureStatement in this case. [118] As I have noted above, clauses 7 and 8 of the Contract read as follows: 7. INCLUDED ITEMS: The Purchase Price includes any buildings, improvements, fixtures, appurtenances and attachments thereto,and all blinds, awnings, screen doors and windows, curtain rods, tracks and valances, fixed mirrors, fixed carpeting, electric, plumbing,heating and air conditioning fixtures and all appurtenances and attachments thereto as viewed by the Buyer at the date of inspection,INCLUDING: Purchase is ‘AS IS WHERE IS’.

BUT EXCLUDING: ______________________________________________ 8. VIEWED: The Property and all included items will be in substantially the same condition at the Possession Date as when viewed bythe Buyer on ______________ yr. ______________. [119] These two clauses, together with clause 16, have to be read together to determine what the Purchase Price includes and whatobligations the Claimant has under the Contract. [120] Typically, according to clause 7, all buildings and other improvements that the buyer inspected on the date set out in clause 8must be included in the transfer.

As such, the seller has an obligation to preserve the property and included items so that they will be insubstantially the same condition at the possession date as when viewed. Without clause 7, anything described in law as a fixture mustremain with the property and be included in the sale, while the seller would be entitled to remove anything described as a chattel. Clause7 attempts to ensure that the buyer receives all the items in the list and those others specifically written in, and the seller can name items,whether chattels or fixtures, which the seller wants to remove.

If a seller wrongfully takes something covered by this clause, the buyer’sremedy would be an action in damages or specific performance. The clause 8 warranty is the basis for the buyer seeking damages torectify the situation where damage has been caused. [121] Clause 16 addresses the passing of the risk between the parties.

It says that all buildings on the Property and all other itemsincluded in the purchase and sale will be, and remain, at the risk of the Seller (the Claimant) until 12:01 a.m. on the Completion Date.After that time, the Property and all included items will be at the risk of the Buyer (the Defendant). [122] In this case, if a “viewed” date had been specified in clause 8, then the Claimant’s obligation would have been to ensure that theProperty and all included items were in substantially the same condition at the Possession Date as when viewed by the Defendant on theviewed date. [123] Typically, in real estate transactions, the possession date is either the same as the completion date (when title to the propertypasses from the seller to the buyer), or a date subsequent to the completion date. [124] In this case, the Completion and Possession Dates were June 1, 2018.

However, no “viewed” date was specified in clause 8. Thatraises the question as to the Claimant’s obligation under clause 7, with reference to what is meant by the notation “Purchase is ‘AS ISWHERE IS’”. [125] This is a notation that comes up in the context of foreclosure sales, and our courts have discussed the meaning to be accorded toit in a number of cases. In Tyk v.

Graham, 2017 BCSC 920 , the court, at para. 14, said: [14] The reference to an “As Is Where Is” clause means this: when mortgage lenders sell property under a foreclosure, they prefer thatthe purchaser bear the risk of the property deteriorating between the time of the contract and the possession date. This is particularly sowhen the debtor is in possession.

They wish the contract of purchase and sale to provide that the purchaser agree to take the property “AsIs Where Is”, that is, in whatever condition the property is in at the time of possession. [126] This appears to have been precisely the Claimant’s motivation in this case: the Claimant wanted the Defendant to take theProperty in whatever condition the Property was in at the time of possession, namely, at 4:00 p.m. on June 1, 2018 (clause 5 of theContract). [127] I find that the proper

interpretation to be given to the notation “Purchase is ‘AS IS WHERE IS’” in clause 7 of the Contract isthat Defendant was to take the Property in whatever condition the Property was in at the time of possession, namely, 4:00 p.m. on June 1,2018. [128] Mr. de Groot testified that the Claimant’s Works remained on the Property as at June 1, 2018. [129] The next question is: do the Claimant’s Works fall within the definition of any of the categories of items mentioned in theincluded items in clause 7, such as, buildings, improvements, fixtures, appurtenances or attachments thereto.

The closest categoryappears to be “improvements.” [130] The Black’s Law Dictionary (Online Legal Dictionary, 2nd Ed.) defines an “improvement” as follows: A valuable addition made to property (usually real estate) or an amelioration in its condition, amounting to more than mere repairs orreplacement of waste, costing labour or capital, and intended to enhance its value and utility or to adapt it for new or further purposes.

[131] The Claimant’s Works were certainly an addition made to the Property. I find that the Claimant’s Works fits within thedefinition of “improvements” in clause 7 of the Contract. [132] Work on the Claimant’s Works commenced on May 22, 2018 at the Claimant’s sole instigation, and not after any agreement,verbal or otherwise, that was concluded between the parties. [133] Mr. de Groot’s evidence was that he interpreted the May 18th Conversation as the Defendant having terminated the Contractbecause “[the Defendant] could not do it – close the deal.” This was an erroneous

interpretation on Mr. de Groot’s part, as the Defendantdid close the deal according to the timelines specified in the Contract. [134] While, by May 18, 2018, the Claimant took the position that the Defendant would not complete, it did not notify the Defendantthat it was treating the Contract as at an end. [135] A seller who fails to notify the buyer that the seller has accepted the buyer’s anticipatory breach is bound to perform itsobligations under the contract: Norfolk v. Aikens (1989), (BC CA), 64 D.L.R. (4th) 1 and Homestar IndustrialProperties Ltd. v.

Philps (1992), (BC CA), 72 B.C.L.R. (2d) 69 (C.A.). [136] An anticipatory breach occurs where one party to a purchase agreement, before the completion date, clearly indicates anintention not to complete. [137] That is not the case here. The Defendant’s evidence was that he was having difficulty securing financing and he asked Mr. deGroot whether the Claimant would be willing to reduce the price to help him out. This cannot be interpreted to mean that the Defendantwould not complete. Certainly, there was nothing in writing that indicated to the Claimant that the Defendant would not complete.

According to the May 17th Addendum, the Defendant had until May 24, 2018 to remove the subject clause, which he did on May 24,2018 and paid the deposit, confirming the deal. [138] Mr. de Groot admitted that he instructed A & H to start the Claimant’s Works in preparation to resell the Property. The Claimantcannot now attempt to recoup the cost of the Claimant’s Works it initiated on its own accord, for its own benefit. [139] The Claimant is bound to perform its obligations under the Contract.

Its obligation under clauses 7 and 8 of the Contract is totransfer the Property and all included items in whatever condition they were in at the time of possession, namely, 4:00 p.m. on June 1,2018. [140] I have already found that there was no oral agreement between the parties regarding the payment of the Claimant’s Expenditure,and the Claimant’s Works fit within the definition of “improvements” in clause 7.

Therefore, since the Claimant’s Works were on theProperty at the Possession Date, I find that, according to clause 7 of the Contract, the Purchase Price included the Claimant’s Works. [141] In light of this conclusion, the Claimant’s claim cannot succeed. However, in the event that I am wrong in this conclusion, I willaddress the Claimant’s alternative argument of unjust enrichment. 4.

Is the Claimant entitled to recover the Claimant’s Expenditure on a quantum meruit basis? [142] The Claimant submits that if no oral agreement is found between the parties regarding the Claimant’s Expenditure, it should beentitled to recover the Claimant’s Expenditure on a quantum meruit basis because the Defendant has been unjustly enriched by theClaimant’s Works. [143] As I said, the parties do not dispute that at the time of possession on June 1, 2018, the Claimant’s Works remained on theProperty, and that the Claimant did not remove any portion of the casing or fill in the hole that was drilled. [144] However, the Defendant denies that he has been unjustly enriched, because the Contract included the Claimant’s Works, andfurthermore, the Claimant’s Works did not produce any water.

He submits that even after the installation of the Defendant’s Works,there is still no water supply to the Property, and he is faced with ongoing costs and emotional distress due to the lack of water to theProperty. [145] As noted above, the test for unjust enrichment has three elements: (1) an enrichment of the defendant; (2) a correspondingdeprivation of the claimant/plaintiff; and (3) an absence of juristic reason for the enrichment. [146] Since there is no dispute that the Claimant’s Works still remain on the Property, the Defendant can be said to be enriched bytheir physical presence, and the Claimant suffering a corresponding deprivation equal to the Claimant’s Expenditure. [147] The next question is whether there is an absence of juristic reason for the enrichment, which is examined in two stages: PacificNational, at para. 23, referencing Garland at paras. 44-46. [148] At the first stage, the Claimant has the burden of showing that there is no juristic reason within the established categories thatwould deny the Claimant recovery.

The established categories are the existence of a contract, disposition of law, donative intent, andother valid common law, equitable or statutory obligations. If the Claimant shows that there is no juristic reason from an establishedcategory, then a prima facie case of unjust enrichment is made out. [149] At the second stage, the onus shifts to the Defendant who must rebut the prima facie case by showing that there is some othervalid reason to deny recovery to the Claimant, and why the enrichment should be retained.

At this stage, the court should have regard tothe reasonable expectations of the parties and public policy considerations. [150] Here, there is a juristic reason to deny recovery to the Claimant: the existence of the Contract, under which, as I have found, thePurchase Price includes the Claimant’s Works. Even if I am wrong in this conclusion, I am satisfied that the Defendant has rebutted the

prima facie case of unjust enrichment, as I will explain below. [ 151 ] The Supreme Court of Canada in Garland , at para 45 , said: The prima facie case is rebuttable, however, where the defendant can show that there is another reason to deny recovery. As a result, there is a de facto burden of proof placed on the defendant to show the reason why the enrichment should be retained.

This stage of the analysis thus provides for a category of residual defence in which courts can look to all of the circumstances of the transaction in order to determine whether there is another reason to deny recovery. (My emphasis) [ 152 ] In looking at all of the circumstances of the purchase and sale of the Property, the Defendant’s expectation was that well and septic services would come with the Property, as advertised in the Listing. He does not take issue with the existing septic tank on the Property.

He said his “ultimate intention was to get water from the Property,” and that is why he borrowed money to install the Defendant’s Works. On the other hand, the Claimant’s expectation was that the Property would be sold “as is”, with the Defendant taking on the risk of whatever condition the Property was in on the Possession Date. [ 153 ] As I said earlier, the Claimant installed the Claimant’s Works on its own accord. Its contract for the Claimant’s Expenditure was with A & H.

By the time the Claimant stopped work on May 25, 2018, substantially all of the work that the Claimant contracted A & H to do was done, based on the fact that A & H’s estimate was for $21,265.00 and the amount it billed and the Claimant paid was $19,892.25 (that is 93.5%). The Defendant did not agree to this expenditure. [ 154 ] The Defendant submits, and I agree, that even though the Claimant’s Works are physically present on the Property, they are of no value to the Defendant, as they did not, on their own or combined with the Defendant’s Works, produce any water for the benefit of the Defendant.

The Defendant is also out-of-pocket by at least $19,470 that he paid for the Defendant’s Works, which is almost equal to the Claimant’s Expenditure of $19,892.25, but the Defendant still has no water. The Defendant and his wife, at their stage in life and with their health concerns, continue to experience, on a daily basis, hardship and financial and emotional distress, due to the water situation at the Property. [ 155 ] Under these circumstances, it would be grossly unjust to have the Defendant bear the Claimant’s Expenditure, without the Defendant receiving any tangible benefit from the Claimant’s Works.

My conclusion may have been different had the Claimant’s Works produced, or even aided in supplying, water to the Property. [ 156 ] The circumstances in this case are distinguishable from those in Pine Drilling . In Pine Drilling , the court, at para. 28, said that the defendant was enriched insofar as he obtained “a well of good quality, both with regard to quantity and quality of the water.” At para. 32, the court found that the claimant was entitled to be compensated on the basis of quantum meruit for installing a working, good- quality well on the defendant’s property. [ 157 ] That is not the case here.

Therefore, I conclude that there is reason to deny recovery to the Claimant. V. CONCLUSION [ 158 ] As discussed, my conclusions are as follows:

a) Neither the Listing nor any oral representations the Claimant may have made to the Defendant formed part of the Contract, thereby obligating the Claimant to provide a well that supplies water to the Property.

b) There was no oral agreement between the parties regarding the payment of the Claimant’s Expenditure.

c) The Purchase Price included the Claimant’s Works.

d) The Claimant is not entitled to recover the Claimant’s Expenditure on a quantum meruit basis. VI. ORDERS [ 159 ] The Claimant’s claim and the Defendant’s counterclaim are dismissed. [ 160 ] Ordinarily, costs are awarded in favour of the successful party. Since neither party in this case has been successful, there will be no order for costs. They will bear their own costs. _____________________________ The Honourable Judge V. Chettiar Provincial Court of British Columbia