) ) CANTINI DEVELOPMENTS LIMITED Plaintiff – v. –, 2013 ONSC 186

CITATION : Cantini Developments Limited v. Hi-Rise Group (Toronto) Inc., 2013 ONSC 186 COURT FILE NO.: 10-0519 DATE: 20130111 ONTARIO SUPERIOR COURT OF JUSTICE BETWEEN: ) ) CANTINI DEVELOPMENTS LIMITED Plaintiff – and – THE HI-RISE GROUP (TORONTO) INC. Defendant ) ) ) ) ) ) ) ) ) W.J. Leslie, Q.C. and A. McInnis, for the Plaintiff S. Schwartz, for the Defendant ) ) ) HEARD: November 28, 29 and 30, 2012 REASONS FOR DECISION QUINLAN J.: [ 1 ] The plaintiff sues for specific performance of a contractual obligation in an Agreement of Purchase and Sale.

The plaintiff seeks an order requiring the defendant to execute documents and cooperate with the plaintiff in its attempt to obtain a severance of land. The plaintiff has elected not to seek damages in lieu of specific performance. [ 2 ] The defendant asserts that it complied with its obligations under the Agreement and, in any event, that specific performance is not available on the facts of this case. [ 3 ] For the reasons that follow, I find that the defendant has not complied with its obligations under the Agreement and the plaintiff is entitled to specific performance.

RELEVANT CONTRACTUAL PROVISIONS [ 4 ] In October 2007, the parties executed two Agreements of Purchase and Sale. One agreement was for the sale for $1.1 million of 22.5 acres from the plaintiff to the defendant.

The other agreement, which is the agreement in issue (the "Agreement"), was for the re-conveyance for ten dollars of 5 acres from the defendant to the plaintiff. [ 5 ] The Agreement, which included an “entire agreement” clause, was conditional on the plaintiff obtaining a severance of the 5 acres and on the severance not interfering with a development plan approved by the Ontario Realty Corporation (ORC) for the development of an Ontario Provincial Police (OPP) station on the lands the plaintiff sold to the defendant.

The Agreement also provided that the defendant did not guarantee, and was under no obligation to provide, access to the severed property via a road that was to be constructed on the lands. The relevant contractual provisions are reproduced in Appendix A to these reasons. POSITIONS OF THE PARTIES [ 6 ] The plaintiff takes the position that: (

a) the "entire agreement clause" precludes consideration of implied terms; (

b) the defendant breached the Agreement by refusing to sign the application for severance;

(

c) the defendant has executed two separate contracts with inconsistent and conflicting terms: one with the plaintiff and the other with the ORC; the plaintiff should therefore not be denied the relief it seeks simply because such relief might result in a breach by the defendant of its agreement with the ORC; and (

d) this court should accordingly compel the defendant to sign the necessary documentation for the severance. [ 7 ] The defendant's position is that: (

a) when the Agreement is interpreted as a whole, it is clear that the defendant did not breach its terms; (

b) the purpose of the defendant acknowledging in

Schedule A to the Agreement that it had not made any representations and warranties with respect to the severed property and that it could not guarantee and was under no obligation to provide access to the severed property via the municipal road was to ensure consistency between the requirements of the Request for Proposal (RFP) issued by the ORC and the business deal between the plaintiff and the defendant; (

c) the respective parties were aware that the RFP required exclusive access to the road to be constructed off Highway 89 and that the consent of the ORC to the severance was required; (

d) the defendant has not refused, but rather has been unable, to sign the application for severance because the ORC will not consent; (

e) to grant the remedy sought by the plaintiff would therefore have the effect of defeating the terms of the Agreement, and (

f) specific performance is not in any event available in the circumstances. FACTS [ 8 ] In April 2007 the plaintiff decided to sell property fronting on Highway 89 in the Town of Mono that was a potential site for an OPP detachment. [ 9 ] Documents filed with the court by the respective parties establish that the following occurred. April 2, 2007 : An RFP was issued by the ORC in relation to the building of an OPP detachment. A term of the RFP was that the OPP have exclusive, not shared, access to the roadway off Highway 89. In addition, the full property was to be leased to the ORC.

April 19, 2007 : The defendant submitted an offer to the plaintiff for $1.3 million conditional on "full and uninterrupted ingress and egress" and "access/egress from Highway 89 to the site for the exclusive (not shared) use of the OPP". These conditions were taken from the RFP and were not carried forward in any subsequent offer or agreement. April 30, 2007 : The plaintiff signed an Agreement of Purchase and Sale in the amount of $1.3 million for the sale of 22.5 acres of vacant land to the defendant.

The agreement was conditional on the defendant being accepted as the successful bidder to build the new OPP detachment. May 11, 2007 : The defendant submitted a Proposal to the ORC in response to the RFP. The Proposal provided that during the term of the lease the site would not be used for any purpose other than the OPP detachment, that access and egress to the site would be solely for the use of the OPP and that all other land not required for the OPP station would be landlocked. September 7-9, 2007 : The defendant contacted the plaintiff to seek a $200,000 reduction in the purchase price for the 22.5 acres.

The plaintiff agreed, in return for a re-conveyance of 5 acres. September 9, 2007 : The plaintiff wrote to the defendant confirming that the plaintiff would reduce the sale price by $200,000 and, in so doing, the plaintiff would retain ownership of 5 acres. September 10, 2007 : The defendant set out an "Amendment" to the April 30, 2007 agreement.

The purchase price was to be reduced from $1.3 million to $1.1 million and the defendant was to re-convey 5 acres of land to the plaintiff on conditions: the plaintiff was to obtain a severance within three years, the re-conveyance was not to interfere with the location of the municipal road to be built servicing the OPP site, the land was not to interfere with the site plan approved by the ORC and the OPP, and the plaintiff was to pay the cost of the severance.

October 11, 2007 : The defendant entered into a lease agreement with the ORC for the lease of the full 22.5 acres, consistent with the Proposal it had earlier submitted. The lands were not to be used for any purposes other than the OPP detachment and would be for the exclusive use of the ORC. October 16-31, 2007 : The parties entered into two new Agreements of Purchase and Sale. One agreement was for the purchase by the defendant from the plaintiff of 22.5 acres for $1.1 million.

The Agreement in issue was for the re-conveyance of 5 acres from the defendant to the plaintiff, conditional on the plaintiff obtaining a final and binding severance that did not interfere with the development plan in relation to the OPP detachment and on the defendant cooperating to achieve the severance. October 31, 2007 : The transaction for the sale of 22.5 acres from the plaintiff to the defendant closed. 2008 : The plaintiff sought the defendant's cooperation to achieve the severance. The defendant responded that the consent of the ORC was required and that that consent was not forthcoming.

As a result, the defendant refused to sign the severance application. The Town later passed a bylaw designating the access road in relation to the 22.5 acres as a public roadway. 2010 : The plaintiff commenced this action against the defendant claiming specific performance of the contractual obligations in the Agreement, including but not limited to the execution of documents. In the alternative, the plaintiff sought a declaration that it was

entitled to treat the Agreement as at an end and was entitled to damages for breach of contract. November 14, 2012 : The bylaw designating the access road in relation to the 22.5 acres as a public roadway was registered on title. November 28, 2012 : This trial commenced. The plaintiff confirmed its election to seek specific performance and not damages.

EVIDENCE The Request for Proposal (RFP) [ 10 ] The plaintiff's president, Barry McLean, testified that he did not review the RFP and was never told of its terms; after a discussion with the secretary at the OPP he decided that the process mandated for the development of the land was too complicated and, although he had initially planned to develop the property for the new OPP detachment, he decided to sell the property. Mr.

McLean testified that although only 4 acres were required for the OPP detachment, there was insufficient time to obtain a severance and, as such, he planned to sell the entire 22.5 acres. [ 11 ] Ms. Claridge, Mr. McLean's lawyer, testified that she did not see the RFP or the defendant's response to it (the Proposal). Although she did not know whether her senior partner, Mr.

Carter, reviewed the RFP, a copy was not in their file. [ 12 ] The defendant's Chief Executive Officer, Warren Green, testified that exclusive access via the public road that was to be built was a “cardinal feature” of the RFP, “really the guts to the deal”. The Lease to the ORC and Exclusive Access [ 13 ] Mr. Green testified that he knew as early as May 2007 that he intended to lease the entire 22.5 acres to the ORC. He testified that when the price reduction in return for the re-conveyance of 5 acres was negotiated, he asked Mr.

McLean how he would get a severance when he could not get access to the municipal road. [ 14 ] Mr. Green testified that when he drafted the letter of September 10, 2007, he knew that he had promised the ORC private and exclusive access to the property. He testified that it was "well-known to the two of us" and that what he had promised the ORC was implied in the September 10, 2007 letter. He testified that the letter did set out that private and exclusive access to the property was required because this was only an amendment to the agreement that included that clause. [1] [ 15 ] Mr.

McLean testified that when the price reduction in return for the re-conveyance of 5 acres was negotiated, there was no discussion about access or about what Mr. Green had promised the ORC in that regard. He agreed, however, that he could not remember all of his discussion with Mr. Green. Mr. McLean testified that he knew that the ORC was going to use a portion of the land but he was not aware that the defendant was entering into a lease with the ORC for the entire property. [ 16 ] Mr. McLean testified that he was "not concerned" with any of the conditions set out in Mr. Green's letter of September 10, 2007.

He knew that the re-conveyance would not interfere with the location of the municipal road to be built servicing the OPP site and would not interfere with the site plan because the ORC would want the building to the west of the road. He was quite prepared to pay the costs of the severance and thought three years to obtain the severance would be sufficient. [ 17 ] Ms. Claridge testified that she was not aware that the defendant had entered into a lease agreement with the ORC for the full 22.5 acres before the Agreement was entered into; had she been aware, she would have counselled Mr.

McLean not to sign the Agreement because of the defendant's conflicting obligation. Ms. Claridge was aware that eventually there would be a lease between the defendant and the ORC. However, she understood that the OPP did not require the full 22.5 acres. The Agreement [ 18 ] Mr. Green agreed that the "entire agreement clause" in the Agreement meant that it was a stand-alone contract. [ 19 ] Paragraph 4 of

Schedule A to the Agreement provided that the severance application and the defendant's obligation to convey the severed property was conditional upon the same not in any way interfering with the development plan approved by the ORC for the development of the OPP station. Paragraph 8 of

Schedule A to the Agreement provided that the defendant could not guarantee and was under no obligation to provide access to the severed property by the municipal road. [ 20 ] In negotiating the Agreement, Ms. Claridge advised Mr. McLean that if paragraph 8 of

Schedule A to the Agreement remained, "then the Seller will be able to easily defeat the intent of this agreement". Ms. Claridge testified that during negotiations with the defendant's lawyer, there was no indication that the defendant could not or would not satisfy the obligation to cooperate with the severance. [ 21 ] Mr. McLean testified that he was not concerned by Ms. Claridge’s warning because he had been advised by the Ministry of Transportation (MOT) that the road off Highway 89 would be a public roadway and Mr.

McLean did not consider it important that the defendant provide a warranty that there be access. Mr. McLean testified that he "knew" that access from the public road was "guaranteed" because the 5 acres to be severed abutted a public road. [2] [ 22 ] Mr. McLean acknowledged that he was aware, however, that there was a risk that a severance might nevertheless not be granted. [ 23 ] Mr. Green testified that paragraph 4 was intended to ensure that the defendant’s obligation to convey the severed property did

not interfere with the development plan with the ORC; paragraph 8 was included because the defendant could not guarantee access. [ 24 ] Mr. Green testified that he and Mr. McLean recognized that the consent of the ORC would be required because the ORC was leasing all of the land. Mr. Green testified that the issue of exclusive access was covered by the fact that the defendant had to be the winning bidder under the RFP. [ 25 ] Mr. Green acknowledged, however, that the proposed severance would not interfere with anything set out in the site plan agreement or with the use of the road.

He agreed that no party can have exclusive control over a public road and that there was nothing in the site plan agreement as to exclusive use of the roadway or the need for ORC consent. [ 26 ] Tanya Cross, the Head of the Corridor Management

Section of the MOT, testified that the MOT's position was that the access road from Highway 89 into the development in question must be a public road; the MOT would not otherwise issue a permit for the property because the MOT’s position is that a public road is not solely for access to the public but also to support the development of all of the lands.

Events after the October 2007 Agreements [ 27 ] The agreement for the sale by the plaintiff to the defendant of the 22.5 acres closed October 31, 2007. [ 28 ] The defendant then built a roadway on the 22.5 acres that included a cul-de-sac on a portion of the 5 acres that was to be re- conveyed to the plaintiff. Although the cul-de-sac encroaches slightly on the 5 acres to be re-conveyed, Mr.

McLean testified, and I find it is clear from the survey, that the defendant could have built the cul-de-sac such that it did not encroach on the 5 acres. [ 29 ] In April 2008, the Town of Mono passed a bylaw establishing the entrance to the property as a public road. For reasons not known to me, the bylaw was not registered on title until November 14, 2012. [ 30 ] Beginning in 2008, Mr. McLean requested the defendant’s cooperation to obtain a severance of the 5 acre parcel . Mr. McLean testified that Mr.

Green initially responded that he wanted to wait until the footprint of the new building was in place, however, when Mr. McLean again requested Mr. Green’s signature on the severance documents, Mr. Green responded with different “excuses”. [ 31 ] Mr. Green testified that he sought the consent of the ORC to the severance of the 5 acre parcel of land in March 2008. In support, Mr. Green filed a letter dated March 18, 2008 from Mr. Green to the ORC. However, I infer that the ORC's response dated March 27, 2008, also filed, is in response to another letter from Mr. Green dated March 18, 2008 and not the letter Mr.

Green identified as having been sent by him in fulfillment of the defendant's obligation to the plaintiff, particularly since there is no evidence as to what other letter or communication prompted the ORC to respond to other issues not raised in the defendant's letter as tendered into evidence. I raised this issue with defence counsel during closing argument and he could offer no satisfactory explanation. [ 32 ] Mr. Green testified that he again sought the consent of the ORC by letter dated September 19, 2012.

The ORC responded on November 19, 2012 that the area depicted on a sketch attached to the letter from Mr. Green did not accurately illustrate a 5 acre parcel of land. The ORC stated that it was not prepared to deviate from the original intent and obligation of the lease, accept a severance of the 5 acre parcel of land or share the access road servicing its exclusive occupancy. [ 33 ] Mr.

Green attempted in evidence to justify the defendant's refusal to sign the application for severance on the basis that the consent of the ORC is required because all the lands the defendant purchased from the plaintiff are leased to the ORC; if the ORC consents, Mr. Green will sign the application. However, Mr.

Green testified that because the ORC has not provided its consent to the severance application , the defendant has, in effect, complied with its obligation to "cooperate with the plaintiff". [ 34 ] The defendant's contract with the plaintiff, however, is not conditional on the defendant receiving the ORC's consent. The Plaintiff’s proposed use of the five acres [ 35 ] Mr. McLean testified that he planned to build something on the 5 acres: this would keep his employees busy with its construction.

In view of the fact that he does not have a pension and he took a price reduction of $200,000 on the sale of the 22.5 acres, he testified that the property could provide him an income during his retirement. His evidence was that the property is in an excellent location: it is on a paved road near three growing communities. [ 36 ] Mr. McLean testified that he could build a rental storage facility on the five acres, given he didn’t know how much water is on the property and people do not want to drive down a gravel road to go to a storage facility.

He also considered designing, building and leasing a facility that “would go along with” the OPP detachment, such as a fire, paramedic or by-law enforcement station. The Order sought [ 37 ] The plaintiff seeks specific performance of the contractual obligations contained in the Agreement, in particular an order mandating that the defendant execute the Application for Consent under

Section 5.3 of the Planning Act , the Consent to Application to Amend Official Plan/Zoning By-Law and the Conditional driveway approval, as well as cooperate with the plaintiff as may otherwise be necessary to pursue severance of the 5 acre parcel.

ANALYSIS 1 . Did the defendant breach the terms of the Agreement? The Law Entire Agreement Clauses [ 38 ] In Gutierrez v. Tropic International Ltd. , [3] the Ontario Court of Appeal considered the effect of entire agreement clauses, adopting the following passage from the Supreme Court of Canada: The question is whether the intention of the parties in the case at bar was that the written contract... would constitute the whole of the contract. That intention, as in all matters relating to contractual construction, must be determined objectively.

Here the parties expressly agreed that the contract documents constituted the whole of their agreement. While in most cases such an agreement is only a presumption based on the parol evidence rule, in this case it has been made an express term of the contract. A presumption can be rebutted; an express term of the contract, barring mistake or fraud, cannot.

Interpretation of a Commercial Contract [ 39 ] The Ontario Court of Appeal decision of Ventas Inc. v. Sunrise Senior Living Real Estate Investment Trust , [4] summarizes the principles to be applied in the

interpretation of a commercial contract, concluding that such a contract is to be interpreted: (

a) as a whole, in a manner that gives meaning to all of its terms and avoids an

interpretation that would render one or more of its terms ineffective; (

b) by determining the intention of the parties in accordance with the language they have used in the written document and based upon the “cardinal presumption” that they have intended what they have said; (

c) with regard to objective evidence of the factual matrix underlying the negotiation of the contract, but without reference to the subjective intention of the parties; and (to the extent there is any ambiguity in the contract), (

d) in a fashion that accords with sound commercial principles and good business sense, and that avoid a commercial absurdity. [ 40 ] The starting point for the court’s inquiry is to look at the words of the document, followed by an examination of context. As stated by the Court of Appeal: Contracts are not made in a vacuum, and there is no dispute that the surrounding circumstances in which a contract is negotiated are relevant considerations in interpreting contracts. As this court noted in Kentucky Fried Chicken, supra, at para. 25, [w]hile the task of

interpretation must begin with the words of the document and their ordinary meaning, the general context that gave birth to the document or its “factual matrix” will also provide the court with useful assistance. [5] Application of the Law [ 41 ] The Agreement contained an "entire agreement clause". That clause includes the following provision: This Agreement, including any

Schedule attached hereto, shall constitute the entire Agreement between Buyer and Seller. There is no representation, warranty, collateral agreement, or condition, which affects this Agreement other than as expressed herein. [ 42 ] I accept the plaintiff's argument that the insertion of this clause in the Agreement demonstrates that the parties chose to be bound by the words expressly set out in their agreement. I find that the agreement between the parties is fully contained within the four corners of the Agreement.

There are no implied terms relevant to the issues to be decided by me. [ 43 ] The terms of the Agreement are clear and unambiguous: the Agreement was conditional on the plaintiff obtaining at its sole expense and in strict compliance with the requirement of paragraphs 3 [6] and 4, a final and binding severance. The defendant was obliged to "cooperate” with the plaintiff in all respects to achieve the severance on an expedited basis.

[ 44 ] Paragraph 4 required that the severance application, any approval obtained by the plaintiff in respect thereof and the defendant's obligation to convey the severed property to the plaintiff was further conditional upon the same not in any way interfering with the development plan approved or to be approved by the ORC for the development of the OPP detachment, which development plan included without limitation the siting of the municipal road to be built and serving the OPP site.

In addition, that paragraph required that the plaintiff agreed to accept any alteration in the configuration of the severed property if the lands to be conveyed interfered with the development plan. [ 45 ] Mr. Green acknowledged that the proposed severance, which is east of the public entrance, would not interfere with anything set out in the development plan or with the use of the road. Mr.

Green agreed that no party can have exclusive control over a public road and that there was nothing in the site plan agreement as to exclusive use of the roadway or the need for ORC consent. [ 46 ] I find that the proposed severance did not interfere with the siting of the municipal road. Although the cul-de-sac encroaches slightly on the 5 acres to be severed, the Agreement required the plaintiff to agree that the configuration of the severed property could be altered. [ 47 ] Paragraph 7 provided that the seller was not representing anything.

Paragraph 8 of the Agreement provided that the plaintiff acknowledged that the defendant could not guarantee access to the severed property by the municipal road and the defendant was under no obligation to provide access to the severed property by the municipal road. [ 48 ] The defendant's position in final argument was that there was no representation with respect to access.

Defence counsel argued that paragraph 8 was inserted to drive that point home and to protect the defendant and ensure compatibility and consistency with the obligation of the defendant to the ORC and to the plaintiff. [ 49 ] However, that was not the evidence of Mr. Green. Mr.

Green testified that the exclusivity of access, which had been expressly dealt with in the initial offer submitted by the defendant, was covered in paragraph 4 and by the fact that the defendant had to be the winning bidder under the RFP. [ 50 ] Paragraph 8 is, in fact, silent as to compatibility and consistency with the defendant's obligations to the ORC and to the plaintiff. It was obvious that the defendant could not guarantee access to the severed property by the municipal road.

However, in view of the registration on November 14, 2012 of the bylaw designating the roadway a public road, I agree with the plaintiff that paragraph 8 is not an issue. [ 51 ] If the parties intended that the ORC's consent would be needed to pursue severance, the Agreement, negotiated with the benefit of legal advice, could easily have stipulated this. [ 52 ] I find that the plaintiff was at all times in strict compliance with all conditions set out in the Agreement.

I accept the position of the plaintiff that the defendant executed two separate contracts, one with the plaintiff and one with the ORC, with inconsistent and conflicting terms. Responsibility for this lies solely with the defendant, and is no basis on which to deny relief to the plaintiff if the plaintiff is otherwise entitled. [ 53 ] The conditions precedent to the defendant’s obligation to cooperate with the severance have been met. However, the defendant has not cooperated.

I therefore find that the defendant has breached the Agreement. [ 54 ] Although I find that the terms and conditions set out in the Agreement and

Schedule A are unambiguous on their face, I have considered and rejected the arguments of the defendant. [ 55 ] In September 2007, when Mr. Green requested a price reduction from Mr. McLean, he had already agreed to lease the entire 22.5 acres to the ORC. He knew that the ORC wanted to lease the entire property and that the ORC would want access to be exclusive and yet he did not subsequently include in the defendant’s agreement with the plaintiff a stipulation that the consent of the ORC would be required as regards any attempt by the plaintiff to sever the 5 acres. [ 56 ] I find that when Mr.

Green signed the defendant’s lease of the entire property to the ORC, Mr. Green did not disclose to the ORC that the defendant had agreed to be contractually-bound to cooperate in an attempt to sever 5 acres of the property. Nor did Mr. Green make any arrangement in the lease, or otherwise, regarding the defendant’s obligation to cooperate with the plaintiff in seeking a severance of 5 acres. [ 57 ] Mr. Green can therefore hardly complain that the relief the plaintiff seeks is inconsistent with the terms of the defendant’s lease with a third party, being the ORC. [ 58 ] I reject Mr. Green’s evidence that Mr.

McLean knew, or should have been able to infer, from the defendant’s initial offer to buy the land that access to the OPP had to be exclusive. That term was not carried forward in any other written offer or agreement, when the term could easily have been included. I accept Mr. McLean’s evidence that he did not review and was not aware of the terms of the RFP. His evidence is supported by that of Ms. Claridge, who testified that she did not review the RFP. I accept her evidence that she did not need to verify a purchaser’s compliance with its obligations. Although Ms. Claridge worked under the direction of Mr.

Carter, I am satisfied that the bulk of the work was performed by Ms. Claridge. Accordingly, I do not accept the defendant’s argument that I should draw an adverse inference from the plaintiff’s failure to call Mr. Carter as a witness. [ 59 ] I accept the evidence of Mr. McLean and Ms. Claridge that they did not know that exclusive access was a term of the RFP and the lease. [ 60 ] I reject the defendant’s submission that Mr. McLean should have realized that the ORC would have to consent to the severance of the 5 acres because the ORC had leased all the property.

The plaintiff was not a party to the lease, nor had Mr. McLean or his lawyer been given a copy during negotiations that culminated in the agreement that closed October 31, 2007.

[61] I reject Mr. Green’s evidence that he raised with Mr. McLean in September 2007 the issue of access to the property. I acceptMr. McLean’s denial. Mr. Green testified that exclusive access to the OPP was a “cardinal feature”, "the guts to the deal". Yet, a termthat Mr. Green testified was so critical to the defendant’s lease to the ORC and which he included in the defendant’s original offer to buythe land from the plaintiff was not subsequently included by Mr. Green in the defendant’s April 30, 2007 agreement to purchase the 22.5acres, the September 10, 2007 letter in which Mr.

Green set out the terms of his discussions with Mr. McLean or the Agreement. [62] I reject Mr. Green’s evidence that he was told by Mr. McLean that the road had to provide exclusive access to the OPP and, asa result, the defendant had to purchase the entire parcel. I accept Mr. McLean’s evidence that the entire acreage had to be conveyed tothe defendant because there was insufficient time to obtain a severance before the defendant was required to submit its Proposal inresponse to the RFP. Mr. Green in fact acknowledged that this was why the entire acreage had to be initially conveyed. [63] I accept Mr.

McLean’s evidence that he did not know that the defendant had guaranteed the ORC exclusive access to theproperty. I accept his evidence that Mr. Green never suggested to him that the ORC would have to consent to the severance. There wasnothing to that effect in the terms of the agreement executed by the parties April 30, 2007, in the letter from Mr. Green dated September10, 2007, in the negotiations between the lawyers or in the Agreement. As noted, exclusivity of access was referred to only in thedefendant’s first offer and there is no document stipulating that the ORC would have to consent to any severance. 2.

Is the plaintiff entitled to the remedy it seeks? [64] The plaintiff seeks an Order compelling the defendant to comply with its obligations to cooperate with the plaintiff; inparticular, an Order requiring the defendant to execute certain documents and co-operate as otherwise necessary for the plaintiff topursue severance of the 5 acre parcel. [65] The defendant argues that the plaintiff has not met the necessary preconditions for specific performance. The Law [66] Specific performance is a discretionary remedy.

It is designed to supplement damages and is not normally granted wheredamages would provide adequate relief: The classic test for its availability is whether damages would be inadequate to return the plaintiff to the position he or she would havebeen in had the contract been performed.

The jurisdiction to award specific performance of contractual obligations is ordinarily exercisedonly where damages would be inadequate to compensate a plaintiff for his or her losses.[7] [67] Where there is something unique about the subject matter of the contract, specific performance is more likely to beordered.[8] [68] In Semelhago v. Paramadevan,[9] Sopinka J. observed that: 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.

The guideline proposed by Estey J. in Asamera Oil Corp. v. Seal Oil & Gen. Corp., (SCC), [1979] 1 S.C.R. 633, with respect to contracts involving chattels is equally applicable to real property.

At p.668, EsteyJ. stated: 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. [69] The Ontario Court of Appeal has agreed that: In order to establish that a property is unique the person seeking the remedy of specific performance must show that the property inquestion has a quality that cannot be readily duplicated elsewhere.

This quality should relate to the proposed use of the property and be aquality that makes it particularly suitable for the purpose for which it was intended."[10] [70] The Supreme Court of Canada in Southcott Estates Inc. v. Toronto Catholic District School Board,[11] recently consideredspecific performance in the context of a plaintiff's duty of mitigation.

In so doing, Madam Justice Karakatsanis, for the majority, wrotethat “[S]pecific performance will be available only where money cannot compensate fully for the loss, because of some ‘peculiar andspecial value’ of the land to the plaintiff”.[12] Application of the Law [71] I find that specific performance is available to the plaintiff.

This is not a case of a “deal falling through for one property" withanother being “readily available".[13] In this case, the plaintiff has already effectively paid $200,000 for the property to be severed,being the $200,000 reduced from the original $1.3 million purchase price for the 22.5 acres in return for a re-conveyance of 5 acres. The

plaintiff will get nothing in return for his $200,000 if the property is not severed. Further, the plaintiff is the only legal entity entitled to pursue severance of the 5 acres. As such, the 5 acres has a "peculiar and special value" to the plaintiff. [ 72 ] The land’s location on a paved road near growing communities, a location that is near the OPP detachment so that a compatible use may be desirable, has a quality that cannot be readily, or at all, duplicated elsewhere. [14] [ 73 ] In addition, uniqueness is only one factor to consider.

I am satisfied that the plaintiff has established that damages would be inadequate to compensate for the loss of the 5 acres.

This is a case in which damages for a severance that may or may not be granted are too speculative or uncertain to be a satisfactory remedy. [ 74 ] The funds with which the plaintiff could have mitigated its losses, if mitigation was necessary, were not available in view of the fact that the plaintiff received $200,000 less for the sale of the 22.5 acres in return for the re-conveyance of 5 acres. [ 75 ] I am satisfied that the plaintiff is entitled to an order compelling the defendant to fulfill its contractual obligations pursuant to the Agreement.

I am satisfied that there is a legal foundation for the granting of an order such as was granted in Dynamic Transport Ltd. v. O.K. Detailing Ltd. [15] [ 76 ] The ORC’s consent may be relevant to the plaintiff’s severance application. Since I infer that the defendant’s March 18, 2008 letter addressed to the ORC, and filed with the court, was not received by the ORC, I do not know what information has thus far been provided by the defendant to the ORC. In addition, circumstances have changed since March 2008. For example, and as noted, the access road has recently been registered as a public roadway.

It was a private road in March 2008. I do not know if events since March 2008 will have an impact on the ORC’s position concerning the proposed severance. The ORC’s current position may have to be determined. In this regard and for these reasons, I find that it is appropriate that the plaintiff deal directly with the ORC and the Town of Mono. CONCLUSION [ 77 ] Accordingly, I grant the following Order:

(1) Requiring an authorized signing officer of the defendant to sign: (

a) the Application for Consent under

Section 5.3 of the Planning Act , (

b) the Consent to Application to Amend Official Plan/Zoning By-Law, and (

c) the Conditional driveway approval;

(2) Authorizing the plaintiff to apply for severance as the landowner’s agent and to deal directly with the ORC and the Town of Mono as required in relation to the application and any and all related issues, and

(3) Requiring the defendant to cooperate with the plaintiff as may otherwise be necessary to apply for and pursue severance of the 5 acre parcel of land described in the Agreement. COSTS [ 78 ] If the parties cannot agree on costs, I will receive written submissions, not to exceed three pages in length, plus a costs outline. The plaintiff’s submissions are due by January 28, 2013. The defendant’s submissions are due by February 7, 2013. Reply, if any, is due by February 14, 2013. QUINLAN J. Released: January 11, 2013 Appendix A 25. Agreement in Writing: If there is conflict or discrepancy between any provision added to this Agreement (including any

Schedule attached hereto) and any provision in the standard pre-set portion hereof, the added provision shall supersede the standard pre-set provision to the extent of such

conflict or discrepancy. This Agreement including any

Schedule attached hereto, shall constitute the entire Agreement between Buyer and Seller. There is no representation, warranty, collateral agreement or condition, which affects this Agreement other than as expressed herein. For the purpose of the Agreement, Seller means vendor and Buyer means purchaser. This Agreement shall be read with all changes of gender or number required by the context. Relevant Conditions in

Schedule A: 2. This offer is conditional until 11:59 p.m. on November 30, 2011, on the Buyer obtaining at its sole expense and in strict compliance with the requirements of paragraphs 3 and 4 below a final and binding severance in accordance with the Planning Act (Ontario), with the expiry of all appeal periods and the fulfillment of all severance conditions, for the five (5) acre parcel of land plus a portion of the laneway at the easterly perimeter of the Property as shown in hatch marks on the attached

Schedule B (collectively the “Severed Property”) to be set out on a reference plan at the Buyer’s expense, provided that the Seller shall co-operate with the Buyer in all respects to achieve the severance on an expedited basis as required.

The above mentioned condition shall be fulfilled on or before November 30, 2011 and the Buyer shall deliver to the Seller or the Seller’s solicitors satisfactory written evidence of the fulfillment of this condition as aforesaid on or before November 30, 2011, failing which this Agreement shall become null and void, all deposit monies shall be returned to the Buyer without interest, penalty or deduction, and both parties shall be released from all further obligations under this Agreement.

The fulfillment of the above noted condition is a true condition precedent to the completion of the within transaction and may not be waived by either party. 4.

The parties further agree that the severance application initiated by the Buyer for the Severed Parcel, any approval obtained by the Buyer in respect thereof and the Seller’s obligation to convey the Severed Property to the Buyer is further conditional upon the same not in any way interfering with the development plan approved or to be approved by Ontario Realty Corporation (“ORC”) and the O.P.P. for the development of the O.P.P. station on the adjoining property of the Seller, which development plan includes without limitation the siting of the municipal road to be built and serving the O.P.P. site thereon (collectively the “Development Plan”).

The Seller agrees, that save for any modifications to the Development Plan required by the Municipality, the ORC or the O.P.P. (which changes shall not require the Buyer’s approval), the Seller shall not make any material change to the Development Plan without the prior written consent of the Buyer, which consent shall not be unreasonably withheld.

The Buyer specifically acknowledges and agrees that where required by the Municipality, the ORC or the O.P.P., or to the extent the lands to be conveyed to the Buyer as set out in any proposed severance application of the Buyer interfere with the Development Plan, the configuration of the Severed Property may be altered and the Buyer agrees to accept any such alteration in the configuration of the Severed Property in full satisfaction thereof, without any compensation or substitution therefore, provided however that any alteration in the configuration of the Severed Property as aforesaid shall not have the effect of reducing the area of the Severed Property to less than five (5) acres in size. 7.

The Buyer acknowledges that the Seller has not and will not make any representations and warranties with respect to the Severed Property, including without limitation, the suitability of the Property for the Buyer’s intended purposes, the zoning or environmental condition of the Property, and that the Buyer shall satisfy itself with respect to such matters.

The Buyer acknowledges that it is accepting the Severed Property in “as-is” condition, and shall accept the Property with any existing registrations on title by any governmental entity relating to the whole parcel from which the Severed Property shall be severed, save and except any provisions which would otherwise be contingent to the terms of this Agreement of Purchase and Sale.

In this regard, the Seller covenants on behalf of itself and its successors in title, that the Seller shall not enter into an agreement with any government entity which would be contrary or thwart the intent of this Agreement, it being understood that the entering into any Agreement that pertains to any allowable modification to the Development Plan as set out in Paragraph 4 above shall be permitted. 8.

The Buyer further acknowledges that the Seller cannot guarantee access to the Severed Property by the municipal road and the Seller is under no obligation to provide access to the Severed Property by the municipal road.