CITATION: The Rosseau Group Inc. v. 2528061 Ontario Inc., 2022 ONSC 486  
COURT FILE NO.: CV-17-3360  
DATE: 20220124  
ONTARIO  
SUPERIOR COURT OF JUSTICE  
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BETWEEN:  
The Rosseau Group Inc.  
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Stephen Schwartz and Emily Quail, for the  
Plaintiff  
Plaintiff  
– and –  
James S.G. MacDonald, for the Defendant  
2528061 Ontario Inc.  
Defendant  
) HEARD: April 8, 9, 12, 13, 14, 15, 16, 19  
and June 11, 2021  
REASONS FOR JUDGMENT  
COATS J.  
1. Nature of Hearing:  
[1]  
The Plaintiff purchaser, Rosseau Group Inc. (“Rosseau”), brings this action against the  
defendant vendor, 2528061 Ontario Inc. (“252”), for an order for damages arising from the  
Defendant’s alleged breach of the parties’ Amended Agreement of Purchase and Sale dated  
March 10, 2017, (“amended APS”). The amended APS relates to land municipally known as  
3728 Mayfield Road, Town of Caledon, Region of Peel (“the Property”). While the Plaintiff  
originally sought an order for specific performance in its Statement of Claim, the Plaintiff has  
since abandoned that relief.  
[2]  
The Plaintiff now seeks general damages for all expenses, losses, including economic  
losses, and lost profits arising from the Defendant’s alleged failure to close the transaction,  
contrary to the terms of the Agreement of Purchase and Sale (“APS”) and the amended APS. The  
Plaintiff also seeks costs on a full indemnity basis.  
Page 2  
[3]  
The Defendant seeks that the action be dismissed with costs. The Defendant also  
counterclaims against the Plaintiff for damages in the amount of $400,000, plus pre and post  
judgment interest. The sum of $400,000 is the amount of further deposit Rosseau was to pay  
upon the waiver of conditions in the APS.  
2. Brief Facts / Chronology:  
Key Individuals:  
1. Dilip Jain: owner and director of 252.  
2. Sukhpreet Sandhu: agent retained by 252 to privately market the Property.  
3. Glen Schnarr & Associates: a planning firm retained by 252.  
4. Manjit Singh Mangat: solicitor for 252.  
5. Chuck Mady: runs the development operations of Rosseau.  
6. John Mehlenbacher: director at Rosseau.  
7. Christopher Haber: solicitor for Rosseau.  
8. Wesley Bagnell: realtor at X-Sell Realty Inc.  
Chronology  
January 20, 2017  
On January 20, 2017, the parties entered into an Agreement of  
Purchase and Sale (“APS”). The APS stipulated that the Defendant  
vendor 252 agreed to sell the Property to the Plaintiff purchaser  
Rosseau at a purchase price of $10,500,000, subject to terms set out in  
Schedule A to the APS. The parties agreed to a deposit of $50,000.  
Schedule A to the APS included the following relevant terms:  
1. The offer was conditional for a period of 90 days from the date  
that the purchaser received the following documents from the  
vendor (“vendor’s documents”):  
a. An existing survey of the Property.  
b. All documents in the vendor’s possession relating to the  
development of the Property.  
c. All environmental, Geo-technical, soil, and other  
reports relating to the development of the Property.  
2. The offer would be conditional for 90 days (the “due diligence  
period”) so that the purchaser could review the vendor’s  
documents and satisfy itself of applicable zoning rules,  
restrictions, and the economic feasibility of the site.  
3. If the purchaser did not provide a waiver to the vendor within  
the 90-day period, then the offer would become void and the  
Page 3  
deposit would be returned to the buyer.  
4. The closing date was 60 days after the removal of all of the  
conditions set out in Schedule A to the APS.  
5. The purchaser agreed to “pay a further sum of Four Hundred  
Thousand $400,000.00 by bank draft or certified cheque to be  
held in the trust of the seller’s solicitor upon waiving all the  
conditions.”  
6. The purchase price was based on 45.71 acres of land, of which  
approximately 30 acres was designated for residential  
development. The parties agreed that if the parties found that  
the number of developable acres was more, or less, than 30  
acres, the purchase price would be adjusted by $350,000 per  
developable acre, which would reflect the final sale price.  
7. If the “net developable acres” was not established prior to the  
closing date, then the closing date would be extended by 60  
days. If the “net developable acres” was not established prior to  
the new, extended closing date, then the vendor agreed to take  
back an interest free mortgage for 50 percent of the sale price  
until final acreage is established.  
March 10, 2017  
The parties entered into an amended APS on March 10, 2017. The  
purchase price was adjusted to reflect a lower “net developable area”  
on the Property than that set out in the APS. The purchase price was  
reduced from $10,500,000 to $6,615,000, based on a reduction in the  
net developable area from 30 acres to 18.9 acres.  
In the amended APS, the parties agreed to remove the following terms  
from the APS:  
1. The purchase price of $10,500,000.  
2. The buyer shall pay the balance of the purchase price by bank  
draft.  
3. The purchase price was based on 45.71 acres of land, of which  
approximately 30 acres was designated for residential  
development. If the parties found that the number of  
developable acres was more or less than 30 acres, then purchase  
price would be adjusted. The adjustment would be $350,000  
per developable acre, which would reflect the final sale price.  
4. If the “net developable acres” was not established prior to the  
closing date, then the closing date would be extended by 60  
Page 4  
days. If the “net developable acres” was not established prior to  
the new, extended closing date, then the vendor agreed to take  
back an interest free mortgage for 50 percent of the sale price  
until final acreage is established.  
The parties agreed to the following terms in the amended APS:  
5. The new purchase price was $6,615,000. This was based on  
18.9 natural net developable acres with a final price adjustment  
accordingly based on more or less at $350,000 per natural net  
developable acre.  
6. On the closing date, the Plaintiff purchaser Rosseau would pay  
$1,790,000 and the original $50,000 deposit to the defendant  
vendor 252.  
7. The Plaintiff purchaser Rosseau would assume the defendant  
vendor 252’s Bank of Montreal mortgage (the “BMO  
Mortgage”) of $1,660,000.  
8. The Defendant vendor 252 would provide a vendor take back  
mortgage of $3,115,000 to the Plaintiff purchaser Rosseau. The  
vendor take-back mortgage would bear no interest until  
“natural net developable acres are established.” Upon  
establishment of natural net developable acres this vendor take  
back would be discharged and Rosseau would pay 252 the sum  
of $3,115,000 plus or minus the natural net developable acres  
that are established.  
9. If the “net developable acres” was not established prior to the  
closing date, then the closing date would be extended by 30  
days. If the “net developable acres” was not established prior to  
the new, extended closing date, then the closing date was to be  
pushed back by an additional 15 days.  
June 7, 2017  
The Plaintiff purchaser Rosseau “waived all the conditions” during the  
due diligence period.  
The Plaintiff purchaser did not make the $400,000 payment following  
the waiver of the conditions.  
June 13, 2017  
July 4, 2017  
The Defendant vendor 252 treated the failure to pay the $400,000 as a  
repudiation of the amended APS and communicated this view to the  
Plaintiff purchaser in two letters, dated June 13, 2017 and July 4, 2017.  
July 5, 2017  
The Defendant vendor returned the $50,000 deposit to the Plaintiff  
Page 5  
purchaser.  
August 7, 2017  
This was the scheduled date for closing of the transaction. The APS  
dictated that the closing date was 60 days after the removal of all the  
conditions set out in Schedule A to the APS.  
August 18, 2017  
The Plaintiff commenced this action for specific performance and  
damages.  
September 4, 2017  
The Plaintiff extended the closing date to September 4, 2017.  
September 19, 2017 After the final extension, the scheduled date for closing of the  
transaction was September 19, 2017.  
October 2, 2017  
The Plaintiff purchaser Rosseau obtained a Certificate of Pending  
Litigation on the Property.  
November 29, 2017 The Defendant vendor 252 moved to set aside the CPL.  
December 14, 2017  
Justice Trimble ordered the CPL on the Property to be set aside.  
3. Issues:  
1. Did the Defendant breach the APS or the amended APS? This involves a determination  
as to whether the terms of the amended APS nullified the requirement that the Plaintiff  
purchaser pay the Defendant a further deposit of $400,000 upon waiver of the due  
diligence condition?  
2. Was the Plaintiff ready, willing, and able to close the APS and amended APS on  
September 19, 2017?  
3. Do Justice Trimble’s findings in his December 14, 2017, Endorsement estop the Plaintiff  
from raising the issue of uniqueness and whether the Plaintiff was ready, willing, and  
able to close the transaction?  
4. What are the Plaintiff’s damages, if any?  
a. Is the Plaintiff’s expert, Martin Quarcoopome of Weston Consulting, qualified to  
provide opinion evidence concerning Rosseau’s estimate of damages?  
b. Did the Plaintiff take steps to mitigate its damages?  
c. How are damages to be calculated and what are the Plaintiff’s damages?  
5. Is the Defendant entitled to $400,000 arising out of the Plaintiff’s failure to pay the  
deposit as required under the APS?  
Page 6  
4. Summary of Parties’ Positions:  
i) The Plaintiff Rosseau  
[4]  
252 breached the APS and amended APS by declaring the agreement to be at an end on  
June 13, 2017. When interpreting the terms of the contract as a whole, with meaning given to all  
of its parts, the correct interpretation of the APS and amended APS is that the $400,000 deposit  
was not required to be paid by Rosseau when it waived the conditions in the APS and amended  
APS on June 7, 2017. Dilip Jain (“Mr. Jain”), the owner of the Defendant, admitted that the non-  
payment of the deposit was the only reason 252 relied upon for the alleged breach of the APS  
and amended APS by Rosseau.  
[5]  
Prior to the scheduled date for closing, September 19, 2017, 252 consistently and  
clearly communicated its decision not to proceed with the transaction and that the APS and  
amended APS were at an end. By doing so, 252 was in anticipatory breach of the APS and  
amended APS. Rosseau did not accept 252’s breach of the APS and amended APS. Rosseau was  
ready, willing, and able to close the transaction. In these circumstances, Rosseau was not  
required to tender. The evidence is clear that Rosseau had the funds available to pay the  
$400,000 deposit on June 7, 2017 and to pay $1,790,000 in cash due on closing. Rosseau was  
also prepared to assume the BMO Mortgage as a concession to 252. To suggest otherwise, is  
speculation.  
[6]  
Rosseau is entitled to damages for breach of contract based on the losses flowing from  
the special circumstances known to the parties at the time they entered into the APS and  
amended APS. Rosseau’s damages should be assessed by reference to the estimated profits  
Rosseau anticipated it would earn but for 252’s breach. The award of damages does not require  
Rosseau to establish a precise calculation of these losses. Rather, it is only necessary that  
Rosseau show that the parties contemplated the circumstances which embraced the damages  
claimed.  
[7]  
Martin Quarcoopome should be qualified as an expert to testify on the estimated profit  
Rosseau would have earned but for 252’s breach. Mr. Quarcoopome obtained his knowledge and  
skill on this issue through his work experience and regularly renders these services and provides  
Page 7  
that advice to his clients. His expertise in this area is consistent with the basis for Rosseau’s  
calculation of its claim for damages.  
[8]  
If 252 is found to be in breach of the Agreement, then the Counterclaim should be  
dismissed. In the alternative, if the Counterclaim is successful, the deposits should not be paid.  
Alternatively, the amount of the deposits should be reduced.  
ii.) The Defendant 252  
[9]  
252 requests judgment on its Counterclaim in the sum of $400,000 and a dismissal of  
Rosseau’s action with costs. The requirement on Rosseau to pay the $400,000 was not expressly  
deleted from the APS. It would be unreasonable to interpret the amended APS to do so impliedly  
and Rosseau’s failure to make that payment was a breach of the APS and amended APS. In the  
alternative, Rosseau was not ready, willing, and able to complete the APS and amended APS  
despite its insistence on completing same on September 19, 2017. That failure was itself a breach  
of the APS and amended APS and is fatal to Rosseau’s claim. In the further alternative, Rosseau  
failed to mitigate its damages by failing to purchase or even look for a substitute where many  
other development opportunities were available (and even acted on by Rosseau’s principals in  
other transactions). In the further alternative, Rosseau has failed to adduce evidence relating to  
the normal measure of damages and a proper date of assessment for damages. Instead, it has  
requested that abnormal measures be utilized to assess damages on a date years in the future and  
has proffered a land-use planner as its expert on damages where such planner has no expertise in  
assessing damages and his report suffers from the frailties of that inexperience.  
5. Positions of the Parties:  
ISSUE 1: Did 252 breach the APS, as amended on March 10, 2017 by the amended APS? Did  
the terms of the amended APS nullify the requirement that the Plaintiff purchaser pay the  
Defendant a further deposit of $400,000 upon waiver of the due diligence condition?  
Plaintiff:  
[10]  
The Plaintiff takes the position that the parties agreed that the amended APS removed  
the requirement that the Plaintiff pay the $400,000 deposit upon waiver of all conditions.  
Page 8  
[11]  
To support its position, the Plaintiff relies on the testimonies of Mr. Bagnell, Mr.  
Sandhu, and Mr. Jain, who all testified that at a meeting in February 2017, the parties discussed  
an amendment to the APS that would reduce the purchase price to $6,615,000. Mr. Bagnell and  
Mr. Jain both testified that the Defendant had a Bank of Montreal mortgage registered on the  
Property, and that the parties discussed that the Plaintiff would assume the BMO mortgage, so  
that the Defendant could avoid a penalty. The Plaintiff’s position is that the Plaintiff agreed to  
assume the mortgage in exchange for the removal of the $400,000 deposit requirement.  
[12]  
The Plaintiff also submits that that the $400,000 deposit was deleted in the amended  
APS, because when the agreed upon payments in the amended APS are totaled, an additional  
$400,000 payment would increase the purchase price beyond the amount specified in the  
amended APS. Specifically, the Plaintiff submits that the parties agreed on the following  
payments: $50,000 (deposit); $1,790,000 (due on closing); $1,660,000 (BMO Mortgage); and  
$3,115,000 (vendor take back mortgage). The Plaintiff submits that because the total of these  
amounts is equal to the agreed upon purchase price, it is clear that there was no requirement to  
pay an additional $400,000 as a deposit.  
[13]  
The Plaintiff relies on the Supreme Court of Canada’s decision in Sattva Capital Corp.  
v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633 (“Sattva”), at para. 47 to submit that  
the words of a contract, alone, do not have an immutable or absolute meaning. Rather, when  
interpreting the provisions of a contract, courts should determine the intent of the parties and the  
scope of their understanding by reading the contract as a whole and in a manner consistent with  
the circumstances known to the parties at the time of the formation of the contract. The Plaintiff  
also relies on the Court of Appeal for Ontario’s decisions in Beatty v. Wei, 2018 ONCA 479  
(“Beatty”), at para. 47 and Starrcoll Inc. v. 2281927 Ontario Ltd., 2016 ONCA 275 (“Starrcoll“),  
at para. 17. to emphasize that the words in a contract must be read in the context in which these  
words are used.  
Defendant:  
[14]  
The Defendant’s position is that the Plaintiff was required to pay the $400,000 deposit  
and that this requirement was not deleted by the amendment to the APS. The Defendant submits  
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that a $50,000 deposit would not have been reasonable in the context of the agreed upon  
purchase price of approx. $6,600,000, whereas a $450,000 deposit was reasonable, because it  
amounted to four percent of the agreed upon purchase price. The Defendant submits that the  
combined $450,000 deposit was a “significant and substantial” part of the APS. In this regard,  
the Defendant relies on Mr. Sandhu’s testimony that a $500,000 deposit would have been  
appropriate, given the purchase price.  
[15]  
In response to the submission the Plaintiff agreed to assume the BMO Mortgage in  
exchange for a removal of the $400,000 deposit requirement, the Defendant submits that the  
Plaintiff’s assumption of the BMO mortgage was not a burden to the Plaintiff. The Defendant  
submits that by assuming the mortgage for $1,660,000, the Plaintiff would have been able to  
avoid paying approximately $1,660,000 in cash on closing. The Defendant relies on the  
testimonies of Mr. Jain and Mr. Sandhu, who testified that neither of them discussed the deletion  
of the $400,000 deposit at the February 2017 meeting.  
[16]  
The Defendant also relies on the Supreme Court of Canada’s decision in Sattva to  
submit that the interpretation of contracts requires an analysis of the objective intentions of the  
parties as expressed in the words of the contract (see Sattva, at para. 32). The Defendant’s  
position is that the Plaintiff’s interpretation of the amended APS is neither reasonable nor  
supported by the context of the negotiations leading up the amendment of the APS. First, the  
Defendant submits that the amended APS clearly listed which terms of the APS were deleted,  
and that the additional $400,000 payment was not deleted in the amended APS. Second, the  
Defendant submits that the amendment to the APS was primarily intended to address (a) the  
reduction in the estimated developable acreage, and (b) the assumption of the BMO mortgage.  
The Defendant relies on the testimonies of Mr. Jain and Mr. Sandhu, who both testified that the  
$400,000 deposit was not discussed at the February 2017 meeting.  
[17]  
Finally, in response to the Plaintiff’s submission that “since there was no room for the  
further $400,000 deposit, it must not exist” the Defendant submits that this interpretation appears  
to be taken after the amendment to the APS in order to justify the Plaintiff’s failure to pay the  
$400,000 deposit. The Defendant submits that this interpretation of the amended APS was never  
recorded by the Plaintiff, nor conveyed to the Defendant via correspondence. The Defendant  
Page 10  
submits that neither 252 nor Mr. Jain had knowledge or notice of the Plaintiff’s interpretation of  
the amendment as deleting the $400,000 deposit. Significantly, the Defendant submits that the  
interpretation that the $400,000 deposit would cause the purchase price to increase by $400,000  
is an ill-considered view to take because this view does not consider that the $400,000 would  
have been credited against the purchase price.  
Plaintiff’s Reply:  
[18]  
The Plaintiff asserts that the Defendant misstates the evidence in four instances. First,  
the Defendant states that Mr. Sandhu did not intend to delete the $400,000. In response, the  
Plaintiff submits that Mr. Sandhu stated in his testimony that he did not recollect whether he  
discussed deleting the $400,000 with Mr. Bagnell. The Plaintiff further points to Mr. Sandhu’s  
repeated claim that the numbers as tallied in the amendment total the final purchase price as  
indicative that the $400,000 was to be excluded. Second, in response to the Defendant’s reliance  
on Mr. Jain’s subjective interpretation of the amendment to include the $400,000, the Plaintiff  
argues that Mr. Jain’s subjective interpretation is both unreasonable and irrelevant. Third, the  
Defendant claimed that neither 252 nor Mr. Sandhu were informed about the Plaintiff’s opinion  
as to the $400,000. The Plaintiff challenges this claim by pointing to Mr. Mady’s testimony,  
during which he claimed to have negotiated the reduction. Fourth, the Defendant submits that the  
parties agreed that the second deposit (presumably the $400,000) would be applied to the  
purchase price. The Plaintiff suggests that this assertion cannot be reconciled with the text of the  
amendment which neatly broke down the final purchase sum and did not include the $400,000.  
Finally, the Plaintiff asserts that the deletion of the $400,000 was consistent with the proposed  
structure of the transaction whereby the Plaintiff would take over the Defendant’s mortgage with  
the Bank of Montreal.  
ISSUE 2: Was the Plaintiff purchaser ready, willing, and able to close the APS and amended  
APS on September 19, 2017  
Plaintiff:  
[19]  
The Plaintiff makes two submissions in relation to this issue. First, the Plaintiff submits  
that the Defendant engaged in an anticipatory breach of the agreement that released the Plaintiff  
from continuing in its obligations under the APS. Second, the Plaintiff submits that it rejected the  
Page 11  
Defendant’s repudiation of the contract and was ready, willing, and able to complete the  
transaction on September 19, 2017.  
[20]  
In support of its position, the Plaintiff relies on the Court of Appeal for Ontario’s  
decision in Place Concorde East Limited Partnership v. Shelter Corporation of Canada (2006),  
211 O.A.C. 141 (C.A.) (“Place Concorde”). The Plaintiff submits that per Place Concorde  
paras. 49-50, a repudiatory breach confers a right on the innocent party to decide whether it will  
accept the repudiation and bring an end to the contract, or to treat the contract as if it is still in  
full force and effect. The Plaintiff submits that it rejected the repudiation of the contract, and  
treated it as binding.  
[21]  
In response to the Defendant’s submissions on this issue, the Plaintiff posits that it was  
ready, willing, and able to complete the transaction because it had the required funds to pay on  
closing; it was prepared to assume the BMO mortgage; and it had established the estimated  
developable acreage of the Property. The Plaintiff submits that it had $1,942,311.91 available to  
pay off the outstanding $1,790,000 due on closing. Further, the Plaintiff submits that because  
the Defendant vendor breached the agreement, the Plaintiff was released from its obligation to  
tender. The Plaintiff relies on the Ontario Court of Appeal’s decisions in Pompeani v. Bonik  
(1997), 104 O.A.C. 149 (C.A.) (“Pompeani”) and Di Millo v. 2099232, 2018 ONCA 1051, 430  
D.L.R. (4th) (“Di Millo”), and the Superior Court decision Silverberg v. 1054384 Ontario  
Limited (2008), 77 R.P.R. (4th) 102 (Ont. S.C.), 2009 ONCA 698 affirmed (“Silverberg”). The  
Plaintiff submits that these decisions stand for the proposition that where the vendor was the  
party that breached the agreement, the Plaintiff was released from its obligation to tender on  
closing.  
Defendant:  
[22]  
The Defendant’s position is that the Plaintiff Rosseau breached the APS because the  
Plaintiff was not ready, willing, and able to complete the APS on September 19, 2017. The  
Defendant submits that the Plaintiff was required to pay $3,450,000 on closing to satisfy the  
purchase price. The Defendant submits that the Plaintiff’s assertions that it “could have been  
ready to close” are not relevant to the analysis of whether the Plaintiff was actually ready to  
Page 12  
close on the September 19 closing date. The Defendant relies on the Court of Appeal for  
Ontario’s decisions in Domicile Developments v. MacTavish (1999), 120 O.A.C. 375 (C.A.)  
(“Domicile”); Kwon v. Cooper (1996), 89 O.A.C. 239 (C.A.) (“Kwon”); and 1179 Hunt Club Inc.  
v. Ottawa Medical Square Inc., 2019 ONCA 700, 6 R.P.R. (6th) 173 (“Hunt Club”).  
[23]  
The Defendant relies on evidence that it says shows that the Plaintiff lacked sufficient  
funds in its two bank accounts to cover the required payments on closing. The Defendant further  
submits that the Plaintiff is relying on the ‘group enterprise theory’ to support its proposition that  
it was ready, willing, and able to close the transaction. That is, the Plaintiff asserts that it could  
have availed itself of the funds of related corporations. The Defendant submits that the group  
enterprise theory was already rejected by the Court of Appeal for Ontario in Yaiguaje v. Chevron  
Corporation, 2018 ONCA 472, 141 O.R. (3d) 1 (“Yaiguaje”), as it violates the principle of  
“corporate separates.” The Defendant further submits that even if the court were willing to  
accept the group enterprise theory, the Plaintiff would still not have been able to muster the  
necessary funds to close the transaction on the agreed upon terms.  
Plaintiff’s Reply:  
[24]  
The Plaintiff submits that the Defendant’s assertion that Rosseau did not wish to close  
the transaction is not supported by the evidence. First, the Plaintiff submits that the Defendant  
has misrepresented Mr. Mady’s testimony in respect to his feelings following the reduction in net  
developable acreage: the Defendant claimed that Mr. Mady was disappointed; the Plaintiff  
emphasizes that Mr. Mady said ‘a little disappointed.’ Second, the Plaintiff claims that the  
Defendant’s assertion that the Rousseau group did not begin due diligence until July 2017 and  
that it failed to produce an extensive feasibility study are refuted by the evidence. The Plaintiff  
points to Mr. Mady’s testimony that he engaged in a ‘high level analysis’ which he then  
discussed with Mr. Quarcoopome.  
[25]  
The Plaintiff rejects the Defendant’s claim that in the absence of taking over the BMO  
Mortgage they would not have been ready, willing, and able to close. Instead, the Plaintiff relies  
on Nutzenberger v. Mert, 2021 ONSC 36, at para. 35, to submit that the Defendant’s failure to  
provide them with contact information for the mortgage ought to be considered - presumably in  
Page 13  
determining whether they took steps to take over the mortgage. Additionally, the Plaintiff relies  
on Mr. Mehlenbacher’s testimony to suggest that even in the absence of the BMO mortgage, the  
Plaintiff was in a position to raise the necessary funds to complete the transaction and were,  
therefore, ready, willing, and able to close.  
[26]  
The Plaintiff further asserts that the cases cited by the Defendant are factually  
distinguishable from the case at bar, and that the legal maxims set out in the cases favour the  
Plaintiff. The Plaintiff reiterates the argument it made in its closing submission that Domicile,  
which the Defendant cites, stands for the proposition that where a vendor refutes the contract, the  
innocent purchaser is not required to prove that they were ready, willing, and able to close. The  
Plaintiff asserts that Hunt stands for that same proposition.  
ISSUE 3: Do Justice Trimble’s findings in his December 14, 2017 Endorsement estop the  
Plaintiff from raising the issue of uniqueness and the issue of whether the Plaintiff was ready,  
willing, and able to close the transaction?  
Plaintiff:  
[27]  
The Plaintiff’s initial closing submission was silent on this issue.  
Defendant:  
[28]  
The Defendant asserts that the issue of uniqueness in respect to the Property and the  
question of whether the Plaintiff was ready, willing, and able to close were conclusively dealt  
with at the motion to vacate the CPL. There, Justice Trimble concluded, after considering  
evidence from both parties, that the Property was not unique and that the Plaintiff was not ready,  
willing, and able to close. The Defendant relies the Toronto Dominion Bank v Leigh, 63 O.T.C. 1  
(Gen. Div.), additional reasons in 78 O.T.C. 134, affirmed in 124 O.A.C. 87 (“Leigh”). to assert  
that the Plaintiff’s failure to appeal the ruling made on the interlocutory CPL motion precludes  
them from now raising these issues here.  
Plaintiff’s Reply:  
[29]  
In response, the Plaintiff asserts that Leigh, is distinguishable from the facts of this  
case; therefore, they ought to be permitted to raise both issues again. In Leigh, estoppel was  
applied to prevent a party from asking a series of questions that were designed to elicit  
Page 14  
information contained in a memorandum, the release of which was prohibited by order of a  
motions judge. Instead, the Plaintiff relies on the Court of Appeal for Ontario’s decision in G.P.I.  
Greenfield Pioneer Inc. v Moore (2002), 155 O.A.C. 305 (C.A.) (“Greenfield”), at paras. 18-20,  
to argue that the issue of uniqueness and whether the Plaintiff was ready, willing, and able to  
close have not been conclusively dealt with. There, the Court held that a motion to discharge a  
CPL does not constitute a final determination in respect to a party’s interest in a property.  
ISSUE 4: What are the plaintiff’s damages?  
a. Is the Plaintiff’s expert, Martin Quarcoopome of Weston Consulting, qualified to provide  
opinion evidence concerning the Plaintiff’s estimate of damages?  
Plaintiff:  
[30]  
The Plaintiff concedes that their expert Mr. Quarcoopome is not an expert appraiser or  
expert business valuator. However, the Plaintiff submits that Mr. Quarcoopome was not retained  
to value land or the business. Rather, he was asked to opine on a specific type of damages,  
namely, those suffered due to being unable to develop the Property; this, the Plaintiff contends,  
lies within Mr. Quarcoopome’s area of expertise as a development consultant. The Plaintiff  
contends that Mr. Quarcoopome’s 15 years of experience working with landowners to determine  
the financial cost, and ultimate profit, of real estate development make him an expert on the  
development potential of various properties. The Plaintiff explains that, in his capacity as  
development consultant, Mr. Quarcoopome collects information and reports from third parties in  
respect to the reports that he prepares.  
Defendant:  
[31]  
The Defendant asserts that Mr. Quarcoopome is not qualified to testify as an expert in  
respect to damages, that the methodology he employed in creating his report is unreliable, and  
that he is not free of bias. The Defendant argues that Mr. Quarcoopome’s expertise as a land  
planner does not qualify him to opine on contract damages, especially since he has never  
prepared a damage valuation report. The Defendant further argues that Mr. Quarcoopome’s  
evidence ought not to be admitted. The Defendant asserts that the Plaintiff’s history of  
transferring acquired properties to a related corporation indicates a lack of intention to develop  
the Property now subject of the litigation. Therefore, the expert’s report is irrelevant as it  
Page 15  
discusses specifically those damages suffered on account of being unable to develop the  
Property. Similarly, the Defendant argues that the methodology employed by Mr. Quarcoopome  
is too imprecise and primitive to yield a reliable outcome. In particular, the Defendant points to  
the following perceived flaws in Mr. Quarcoopome’s report:  
He opined on the Plaintiff’s hypothetical profit from developing the Property without  
investigating the profitability of the Plaintiff’s other projects.  
He did not consider the Plaintiff’s ability to mitigate of damages.  
His analysis is premised on the assumption that the Plaintiff will develop the land;  
however, Mr. Mady and Mr. Mehlenbacher conceded that in their business structure  
another corporation would be responsible for development.  
His report does not state what date of assessment was used.  
[32]  
The Defendant questions Mr. Quarcoopome’s impartiality on the basis that he is the  
only planner Mr. Mady has used in five years.  
Plaintiff’s Reply:  
[33]  
In respect to the Defendant’s allegations of partiality, the Plaintiff submits that a prior  
retention of the expert is irrelevant when assessing bias. Relying on the Supreme Court’s ruling  
in White Burgess Langille Inman v Abbott Haliburton Co., 2015 SCC 23, para. 49, the Plaintiff  
posits that it is settled law that the impartiality of an expert is related to their ability to provide  
the court with objective evidence and is not impeached merely because they were involved in  
work ultimately leading to the litigation.  
b. Did the Plaintiff take steps to mitigate its damages?  
Plaintiff:  
[34]  
The Plaintiff cites Southcott Estates Inc. v. Toronto Catholic District School Board,  
2012 SCC 51, [2012] 2 S.C.R. 675, to assert that the Defendant bears the onus to demonstrate  
that mitigation was possible and that the Plaintiff failed to take reasonable steps to mitigate their  
damages. The Plaintiff states that the Defendant has been unable to demonstrate this, and that in  
any event, the Plaintiff was unable to mitigate its’ loss. The Plaintiff points out that they  
examined up to 30 properties each month in the Greater Toronto Area (“GTA”) and the regions  
beyond; this, Plaintiff suggests constitutes reasonable steps to seek out a viable alternative  
property to mitigate their loss. The Plaintiff further submits that they made a series of purchases  
Page 16  
in 2017; however, none that were able to mitigate for the alleged loss of the Property. The  
Plaintiff, relying on the conclusion of their expert, Mr. Bottero, asserts that the properties that the  
Defendant’s expert, Mr. Tilley, deemed ‘similar’ were not comparable to the Property.  
[35]  
The Defendant retained Mr. Tilley to demonstrate that mitigation was possible for the  
Plaintiff. The Plaintiff called Mr. Tilley’s methodology into question. In particular, the Plaintiff  
points to the following perceived flaws in Mr. Tilley’s report:  
He toured neither the Property nor the properties suggested as alternatives at the time of  
the report.  
His analysis on the viability of the alternate properties was premised on outdated and  
inaccurate data in respect to size of the area available for development.  
He did not contact Weston Consulting to obtain an updated number for the developable  
acreage of the Property.  
He conceded that his budget in completing the report was on the lower range of the  
spectrum.  
He did not verify the relationship between transacting parties in respect to the alternative  
properties and failed to determine the nature and methodology of those transactions.  
[36]  
In their written submissions, the Plaintiff reviewed each of the eleven alternative sites  
identified by Mr. Tilley and, relying on concessions obtained during Mr. Tilley’s cross-  
examination, submits that none of the suggested cites are a viable alternative to the Property.  
[37]  
The Plaintiff requests that the Court accept the evidence of Mr. Bottero, its own expert,  
over that of Mr. Tilley. The Plaintiff submits that Mr. Bottero’s methodology was more precise  
and did not contain the flaws that it alleges mar Mr. Tilley’s assessment. Relying on Mr.  
Bottero’s testimony, the Plaintiff claims that several of the alternative properties were not listed  
on the open market and therefore not readily accessible to the Plaintiff. In any event, the Plaintiff  
posits that in Mr. Bottero’s opinion the Property was more desirable than any of the alternative  
properties.  
Defendant:  
[38]  
The Defendant submits that the Plaintiff failed to take steps to mitigate their losses. The  
Defendant analogizes the facts of the case at bar to those of Southcott, at para. 83 where the  
Supreme Court found that the Plaintiff in a real estate litigation had failed to mitigate their losses  
Page 17  
after not taking steps to locate alternate properties. There, at para. 84, the Plaintiff corporation  
was a subsidiary of a larger business; the court held the Plaintiff was not free to rely on the  
purchase of other subsidiaries controlled by the same directing mind to argue that it was engaged  
in mitigation. The Defendant submits that the evidence of its expert, Mr. Tilley, illustrates that if  
the Plaintiff had engaged in steps to mitigate, it would have been successful. The Defendant also  
submits that the Plaintiff’s expert, Mr. Bottero’s, claim that the alternatively available properties  
were not sufficiently similar is irrelevant as the Plaintiff abandoned their claim for specific  
performance, thereby conceding that the Property was not unique.  
[39]  
The Defendant further submits that in any case the Court does not need to concern itself  
with the discrepancy between Mr. Tilley’s and Mr. Bottero’s opinions. The Defendant submits  
that the issue of uniqueness of the land was conclusively dealt with by Justice Trimble and the  
issue is, therefore, res judicata.  
Plaintiff’s Reply:  
[40]  
The Plaintiff rejects the Defendant’s assertion that there were “thousands” of  
comparable properties available. Instead, the Plaintiff reiterates that that the evidence shows that  
they sought out alternatives but were unable to find a satisfactory property.  
[41]  
The Plaintiff posits that the testimony of Mr. Bottero continues to be relevant and does  
not address a moot issue. The Plaintiff submits that the defense is erroneously conflating the  
issue of uniqueness for purposes of specific performance and the issue of mitigation. The  
Plaintiff maintains that Mr. Bottero’s evidence demonstrates that mitigation was not possible.  
c. How are damages to be calculated and what are the Plaintiff’s damages?  
Plaintiff:  
[42] The Plaintiff initially requested specific performance but has since abandoned that claim.  
Instead, the Plaintiff asks for damages ‘somewhere’ between $10.1 million to $12.1 million,  
based on the estimated profit the Plaintiff would have earned had the purchase closed and the  
Plaintiff developed the Property. The Plaintiff relies on Performance Industries Ltd. v. Sylvan  
Lake Golf & Tennis Club Ltd., 2002 SCC 19, [2002] 1 S.C.R. 678, for the proposition that ‘lost  
Page 18  
profits’ are an appropriate measure of damages in litigation such as this. The Plaintiff refers to  
the evidence of Mr. Quarcoopome to justify the range of the quantum requested. He estimated  
that Rosseau would have incurred approximately $11 million in expenses to, inter alia, develop,  
construct, and rezone, the land and the associated tax and legal costs of this venture. However,  
Rosseau’s efforts would have yielded approximately $21.5 million to $23.5 million in revenue,  
totaling lost profits of $10.1 million to $12.1 million.  
Defendant:  
[43] The Defendant refers to the Court of Appeal for Ontario’s ruling in Rougemount Capital  
Inc. v. Computer Associates International Inc., 2016 ONCA 847, for the proposition that this  
Court should start from a presumption that damages are assessed from the point in time of the  
breach of the contract. Therefore, the Defendant asks the Court to conclude that the appropriate  
measure of damages ought to be the difference in the contracted price and the market value of  
the Property on September 19, 2017.  
Plaintiff’s Reply:  
[44] In reply, the Plaintiff counters that Justice Morgan clarified at para. 22 in Akelius Canada  
Inc. v. 2436196 Ontario Inc., 2020 ONSC 6182, a case that the Defendant had themselves relied  
on, that “the date for the assessment of damages is determined by what is fair on the facts of each  
case.” Therefore, the Plaintiff submits that the Defendant’s theory of damages ought to be  
disregarded.  
ISSUE 5: The Defendant’s Counterclaim.  
Plaintiff:  
[45]  
The Plaintiff submits that the Defendant’s own conduct following its repudiation of the  
APS illustrates that its counterclaim is without merit. After indicating to the Plaintiff’s counsel  
that it treated the APS and amended APS to be at an end, the Defendant returned the deposit and  
issued no subsequent demands for money. The Plaintiff now asks the court to exercise its  
discretion under s. 98 of the Courts of Justice Act, R.S.O. 1990, c. 43 and excuse the Plaintiff  
from having the deposit forfeited. The Plaintiff relies on Jesan Real Estate Ltd. v. Doyle, 2020  
ONCA 714, 26 R.P.R. (6th) 233, (“Doyle”) at para. 54 to support its proposition. There, the  
Page 19  
Court of Appeal for Ontario held that the exercise of judicial discretion was warranted where the  
forfeited deposit was disproportional to the damages suffered and where it would be  
unconscionable for the vendor to retain the monies. The Plaintiff submits that the deposit of  
$400,000 was premised on a total purchase price of $10,500,000. When the overall price was  
adjusted downward to $6,615,000 the deposit price was not reduced; therefore, the Plaintiff  
reasons, it is not proportional. The Plaintiff notes that it would be unconscionable for the  
Defendant to retain the deposit as it suffered no losses on account of its conduct, had no apparent  
expectations of receiving the monies, and had the opportunity to obtain the deposit and the full  
purchase price if it would have closed the transaction.  
Defendant:  
[46]  
The Defendant submits that it is entitled to $400,000 in damages because the Plaintiff  
failed to pay the $400,000 deposit. The Defendant takes the position that the termination of the  
APS did not extinguish 252’s rights under the agreement, including the Plaintiff’s obligation to  
pay the $400,000 deposit. In support of its position, the Defendant relies on the British Columbia  
Court of Appeal’s decision in Vanvic Ent. Ltd. v. Mack (1985), 17 D.L.R. (4th) 177 (B.C. C.A.)  
(“Vanvic”). The Defendant submits that it bases its counterclaim on the Vanvic decision, wherein  
the court held that a Plaintiff had the right to recover a deposit that had been paid by the  
Defendant via cheque where the contract had been repudiated. The Defendant submits that the  
deposit was a right that accrued to 252 at the time of the waiver and survives the contract.  
Consequently, 252 is entitled to recover the amount of the $400,000 as damages.  
Plaintiff’s Reply:  
[47]  
The Plaintiff makes three submissions in reply in respect to the Defendant’s claim for  
$400,000. First, the Plaintiff asserts that the Defendant misrepresents Mr. Sandhu’s evidence in  
respect to the amendment to the APS. Second, the Plaintiff posits that because Mr. Jain  
instructed his solicitors to terminate the agreement, his subjective interpretation of the contract is  
irrelevant. Third, the Plaintiff submits that the contextual evidence surrounding the amendment  
indicates that the parties intended to remove the $400,000 deposit from the final agreement.  
Page 20  
6. Analysis  
ISSUE 1: Did 252 breach the APS, as amended on March 10, 2017 by the amended APS? Did  
the terms of the amended APS nullify the requirement that the Plaintiff purchaser pay the  
Defendant a further deposit of $400,000 upon waiver of the due diligence condition?  
I. The Law  
[48]  
The proper approach to contract interpretation was summarized by the Supreme Court  
of Canada in Sattva, at paras. 47 and 57:  
[47] Regarding the first development, the interpretation of contracts has evolved  
towards a practical, common-sense approach not dominated by technical rules of  
construction. The overriding concern is to determine “the intent of the parties and  
the scope of their understanding” (Jesuit Fathers of Upper Canada v. Guardian  
Insurance Co. of Canada, 2006 SCC 21, [2006] 1 S.C.R. 744, at para. 27, per  
LeBel J.; see also Tercon Contractors Ltd. v. British Columbia (Transportation  
and Highways), 2010 SCC 4, [2010] 1 S.C.R. 69, at paras. 64-65, per Cromwell  
J.). To do so, a decision-maker must read the contract as a whole, giving the  
words used their ordinary and grammatical meaning, consistent with the  
surrounding circumstances known to the parties at the time of formation of the  
contract. Consideration of the surrounding circumstances recognizes that  
ascertaining contractual intention can be difficult when looking at words on their  
own, because words alone do not have an immutable or absolute meaning:  
No contracts are made in a vacuum: there is always a setting in  
which they have to be placed. . . . In a commercial contract it is  
certainly right that the court should know the commercial purpose  
of the contract and this in turn presupposes knowledge of the  
genesis of the transaction, the background, the context, the market  
in which the parties are operating.  
(Reardon Smith Line, at p. 574, per Lord Wilberforce)  
***  
[57] While the surrounding circumstances will be considered in interpreting the  
terms of a contract, they must never be allowed to overwhelm the words of that  
agreement (Hayes Forest Services, at para. 14; and Hall, at p. 30). The goal of  
examining such evidence is to deepen a decision-maker’s understanding of the  
mutual and objective intentions of the parties as expressed in the words of the  
contract. The interpretation of a written contractual provision must always be  
grounded in the text and read in light of the entire contract (Hall, at pp. 15 and 30-  
32). While the surrounding circumstances are relied upon in the interpretive  
process, courts cannot use them to deviate from the text such that the court  
effectively creates a new agreement (Glaswegian Enterprises Inc. v. B.C. Tel  
Mobility Cellular Inc. (1997), 1997 CanLII 4085 (BC CA), 101 B.C.A.C. 62).  
Page 21  
[49]  
Further, para. 47 of the Court of Appeal for Ontario’s decision in Beatty provides as  
follows:  
[47] A fundamental precept of contractual interpretation is that “a contract is to  
be construed as a whole with meaning given to all of its parts”: Geoff R. Hall,  
Canadian Contractual Interpretation Law, 3d ed. (Toronto: LexisNexis Canada,  
2016), at p. 16. A provision in a contract should not be read as standing alone, but  
in light of the agreement as a whole and its other provisions: Hillis Oil and Sales  
Limited v. Wynn's Canada, Ltd., 1986 CanLII 44 (SCC), [1986] 1 S.C.R. 57, at p.  
66. See also Hall, at p. 21.  
[50]  
The Court of Appeal for Ontario elaborated on this approach in para. 20 of Starrcoll:  
[20]  
As explained in Sattva, contractual interpretation is a search for the  
objective intention of the parties as discerned from the language of the relevant  
provision considered in the context of the entirety of the agreement, the purpose  
of the provision, the nature of the relationship created by the agreement, and any  
other relevant surrounding circumstances. An application of that approach to the  
Escrow Provision leads me to conclude that gross rental as at the end of the  
Performance Period (May 1, 2014) was to be determined by annualizing the  
amount of rental income shown on the rent rolls setting out the rents as of May 1,  
2014. On that interpretation, the $960,000 threshold was met and Starrcoll is  
entitled to the $300,000.  
[51]  
While surrounding circumstances will be considered in interpreting the terms of a  
contract, the surrounding circumstances cannot “overwhelm the words” of the agreement. The  
court must ground its interpretation in the text of the contract, looking at the objective evidence.  
Evidence of an individual’s interpretation of the agreement is not helpful. (See Deslaurier  
Custom Cabinets Inc. v. 1728106 Ontario Inc., 2017 ONCA 293, 135 O.R. (3d) 241, at paras.  
37-38.)  
II. The Evidence  
a) The Parties:  
[52]  
Most of the facts concerning the circumstances surrounding the execution of the APS  
are not in dispute. There is only disagreement as to the evidence surrounding the execution of the  
amended APS. I will resolve any factual disputes as required and indicate where the positions  
differ on the evidence.  
Page 22  
[53]  
Rosseau was formed in 2013. It is directed by John Mehlenbacher. Mr. Mehlenbacher  
deposed that the Rosseau operates in two silos. One silo is a private equity fund where the  
company raises money from outside investors in a limited partnership format to invest in its own  
or other parties’ projects. In the second silo, Rosseau buys and develops land financed with  
private equity funds.  
[54]  
Mr. Mehlenbacher testified that in almost all circumstances, he incorporates separate  
corporations to own lands purchased for investment and development. This is confirmed by  
evidence regarding previous investments and projects in which Mr. Mehlenbacher participated -  
all of which, save one, were entered into by corporations other than Rosseau.  
[55]  
Mr. Mehlenbacher testified that there were a number of separate corporations also  
owned and managed by himself and other shareholders. Some of the corporations mentioned  
were Rosseau Development Corp., Condo Store Realty Inc., Condo Store Marketing System Inc.,  
and Insider Condo Club Ltd. There was no evidence submitted that these corporations were  
subsidiaries of Rosseau - only that Mr. Mehlenbacher was involved in them as he is involved  
with the Rosseau.  
[56]  
In 2013, when Rosseau started, it operated as a private equity fund and invested in other  
parties’ projects. In 2016, Rosseau opened its own development infrastructure to finance its own  
projects with its own funds. Rosseau retained Chuck Mady for that purpose. Mr. Mady runs the  
development operation of Rosseau and oversees sourcing land and projects from the start to  
finish.  
[57]  
Mr. Mady provided evidence of his decades long career in real estate development  
including his substantial experience and expertise in planning, construction, financing, and  
determining revenue.  
[58]  
Mr. Jain is a director of 252. He testified that 252 was incorporated in July 2016 for the  
sole purpose of purchasing and owning the Property. Mr. Jain is a pharmacist and has been a  
pharmacist for approximately 36 years. He had no real estate development experience prior to  
the acquisition of the Property.  
Page 23  
[59]  
Mr. Jain testified that in July 2016, 252 purchased the Property for $2.65 million. The  
purchase was financed by a $1,680,000 loan from BMO, which was secured by a first mortgage  
registered against title to the Property. It was a fixed mortgage for five years at an interest rate of  
2.49 % per annum.  
[60]  
Mr. Jain’s intention in purchasing the Property through 252 was to develop it himself  
by rezoning it and building residential homes. He also hoped to have 252 develop and build a  
health clinic at the Property. He intended to develop the Property because he knew “that is where  
the real money was.” He retained Glen Schnarr & Associates (“Schnarr”) to assist him with the  
development of the Property.  
b) The APS:  
[61]  
The litigation arises out of the failed purchase and sale of the Property. The Property is  
located at the north east corner of Mayfield Road and Kennedy Road in Caledon. It is 45.71  
acres and contains a substantial amount of natural heritage features including a wetland and  
valley system.  
[62]  
The Property is undeveloped and made up of vacant farmland, wetlands, and a  
residential house. The Property is zoned for agricultural (A1) and conservation (EPA 2 -  
Environmental Policy Area 2) uses. A large part of the Property is made up of environmentally  
sensitive wetland and the Property is under the jurisdiction of the Toronto and Region  
Conservation Authority (“TRCA”).  
[63]  
The parties’ evidence is consistent concerning their introduction to each other and the  
steps leading to the preparation and execution of the APS.  
[64]  
Schnarr advised Mr. Jain that it would take, at a minimum, seven and half to ten years  
to develop the Property. The process would be long and costly. As a result, Mr. Jain decided to  
sell the Property instead.  
[65]  
Mr. Jain was approached by a realtor, Sukhpreet Sandhu at the Jain Professional Centre  
in January of 2017. Mr. Sandhu’s brother-in-law was one of Mr. Jain’s tenants at the  
Professional Centre. Mr. Sandhu came to know about 252’s ownership of the Property and  
Page 24  
offered to market it for sale. Mr. Sandhu was retained by 252 as agent to privately market the  
Property; it was not listed on the Multiple Listing Service.  
[66]  
Mr. Sandhu brought the Property to the attention of Wesley Bagnell, a realtor at X-Sell  
Realty Inc., in or about January of 2017. Mr. Sandhu described the Property to Mr. Bagnell as  
having 30 developable acres and that a lot of work had to be done to get it developed. Mr.  
Sandhu and Mr. Bagnell discussed that 252 was interested in selling the land for $350,000 per  
developable acre.  
[67]  
In or about December 2016 or January 2017, Mr. Mady met Mr. Bagnell. Mr. Mady  
advised Mr. Bagnell that he was looking for small to average residential parcels of land with  
interesting physical characteristics. Mr. Mady testified that he did not want to develop a  
subdivision in tract land. He was looking for a small property of 5 - 40 acres, that had physical  
characteristics that he could leverage.  
[68]  
Mr. Mady explained it was harder to compete with the large tract builders in Toronto.  
He was interested in finding “niche plays”: small properties with unique features, like wetlands  
or rolling terrain, that he could leverage into a “green themed community.” By “leverage”, Mr.  
Mady confirmed, he meant developing a natural heritage subdivision of single and townhomes  
with walking trails or nature trails. Mr. Mady had experience with this type of development in  
the past, testifying that he has “known people to love getting involved with a community like  
that.”  
[69]  
According to Mr. Bagnell, Mr. Mady advised him that Rosseau was interested in  
purchasing “development properties” and “investment properties” to develop or sell. Mr. Bagnell  
testified that there were no particular or unique features described by Mr. Mady to guide Mr.  
Bagnell’s search - simply that Rosseau was looking for investment or development properties.  
[70]  
Mr. Bagnell and Mr. Mady both testified that Mr. Bagnell introduced Mr. Mady to the  
Property. They visited it together and after seeing it, Mr. Mady instructed Mr. Bagnell to prepare  
an offer at $350,000 per net developable acre. All relevant witnesses testified that the purchase  
price was based on the amount of net developable acres because the value in the land is in its  
potential for development.  
Page 25  
[71]  
Mr. Bagnell prepared an APS dated January 20, 2017. Rosseau signed on January 16,  
2017, and 252 signed on January 18, 2017. The Defendant did not negotiate the APS. 252  
accepted the terms of the APS without any amendments.  
[72]  
The material terms of the APS are as follows:  
i.  
Purchase price $10,500,000;  
ii.  
The APS was conditional for a period of 90 days from the receipt of the  
vendor’s documents for the purchaser to satisfy itself including but not  
limited to the following issues:  
a) Reviewing all the vendor’s documents in its possession  
related to the development of the Property;  
b) Zoning and restrictions;  
c) The economic feasibility of the development of the site.  
iii. If the Seller or the Seller’s agent did not receive in writing during the due  
diligence period that the condition has been waived, then the APS would  
be null and void and the deposit returned to the Buyer in full without  
interest or deductions. Rosseau had paid a $50,000 deposit at the time of  
the APS to Manjeet Singh Mangat, 252’s solicitor. The deposit was to be  
held in trust pending completion and to be credited toward the purchase  
price on completion.  
iv.  
The Buyer agrees to pay a further sum of $400,000 by bank draft or  
certified cheque to be held in the trust of the Seller’s solicitor upon  
waiving all the conditions.  
v.  
The purchase price under the APS was adjustable based in the  
“developable” acres as provided for at Schedule A to the APS. The  
purchase price was based on a price of $350,000 per developable acre to  
be adjusted accordingly, with 50 per cent of the sale price held by an  
interest free take back mortgage until the final acreage is established.  
Schedule A to the APS provides the following clause:  
The purchase price of $10,500,00 is based on 45.71 acre of  
which approximately 30 acre being developable and  
designated for residential development, allowing  
townhouses, semis and single homes, in the event of the  
number of developable acres is changed to be more or less  
as stated above, then the purchase price to be adjusted  
accordingly based on a price of $350,000 per developable  
acre to reflect the final sale price, in the event net  
developable acres is not established prior to the date set for  
closing, then closing shall be expanded for further 60 days  
Page 26  
and in the event net developable is still not established,  
then Seller agrees to take back an interest -free mortgage  
for 50 per cent of the sale price until, final acreage is  
established, the mortgage shall be due and payable 15 days  
following the net developable being established.  
vi.  
Closing was scheduled to be 60 days after the removal of the all  
conditions.  
vii. Rosseau had free reign to conduct its own due diligence and inspect the  
Property.  
[73]  
Mr. Jain testified that he knew Rosseau’s intention in purchasing the Property was to  
develop the land and build houses. The APS clearly contemplates residential development on the  
Property. Mr. Jain acknowledged that the value of the Property was based on its development  
potential. He knew it would take many years to develop.  
[74]  
Mr. Jain agreed that the parties would not know the final determination of the net  
developable acres of the Property until after closing. Once it was determined, Rosseau would pay  
the balance of the purchase price and the vendor take back mortgage would be discharged.  
[75]  
The identity of the person or authority who would determine or “establish” the “final  
acreage” referred to in the APS was not resolved by the parties during the life of the transaction.  
Mr. Mady testified that he believed that it would be determined by TRCA and 252’s planner. Mr.  
Quarcoopome testified that TRCA would make that determination. Mr. Jain testified that he  
thought it would be Rosseau and its planner who would establish that acreage.  
c) Events Subsequent to the Delivery of the APS:  
[76]  
Mr. Jain testified that shortly after the APS was entered into between 252 and Rosseau,  
he was informed by 252’s planners at Schnarr that the estimated developable acreage at the  
Property was much less than 30 acres. The new estimate was 18.9 acres. Mr. Jain testified that he  
directed Mr. Sandhu to advise Rosseau thereof. Mr. Mady testified that Mr. Bagnell was in touch  
with him in February or March 2017 and advised him that there was a reduction in the  
developable acreage at the Property.  
Page 27  
[77]  
I find that Rosseau knew about the new estimate of 18.9 developable acres by February  
11, 2017. That is the date that Rosseau entered into an assignment agreement with 1371975  
Ontario Inc. (a company that Mr. Mady and Mr. Bagnell described as being managed by a man  
named Joseph Cohen). That assignment agreement set out the price of the assignment as  
$8,977,500 based on the same 18.9 “net developable acres” that had been estimated for 252 by  
Schnarr. The assignment agreement set out a price of $475,000 per developable acre (at  
Schedules A and B). Rosseau did not advise 252 of its assignment of the APS to Mr. Cohen’s  
corporation.  
[78]  
Mr. Bagnell, Mr. Sandhu, and Mr. Jain testified that a meeting was held between the  
three of them at Mr. Jain’s office in February 2017. Mr. Sandhu arranged the meeting because as  
set out above, Schnarr had calculated a new estimate for the net developable acres of the  
Property. In the new estimate the Property contained only 18.9 developable acres not 30  
developable acres. As a result, the purchase price under the APS had to be amended.  
[79]  
Mr. Jain testified that 252 was still prepared to sell the Property at $350,000 per net  
developable acre and was also prepared to grant a vendor take back mortgage for one half of the  
purchase price, at zero interest, pending the determination of the net developable acreage for the  
Property. The new purchase price was calculated at 18.9 acres x $350,000 for a total of  
$6,615,000.  
[80]  
Mr. Bagnell and Mr. Jain both testified that at the February 2017 meeting, Mr. Jain  
raised the issue of the BMO Mortgage registered against the Property. Mr. Jain wanted Rosseau  
to assume the mortgage, so that 252 could avoid incurring a $200,000 penalty for its early  
discharge. Mr. Jain testified, that at the meeting he did not know the penalty amount other than  
that it would be substantial. Mr. Sandhu testified that Mr. Jain gave him the amount of the  
penalty. BMO would have to approve the assumption of the mortgage by Rosseau.  
[81]  
There is consensus that Mr. Jain, Mr. Sandhu, and Mr. Bagnell did not discuss the  
deletion of the $400,000 deposit at their February 2017 meeting.  
[82]  
Mr. Bagnell and Mr. Mady both testified that after the meeting, Mr. Bagnell  
approached Mr. Mady and told him of the change in the estimated net developable acres from 30  
Page 28  
to 18.9 acres and of 252’s request for Rosseau to assume the BMO Mortgage. Mr. Bagnell and  
Mr. Mady testified that Rosseau was prepared to proceed with the purchase of the Property at  
18.9 acres based on a $350,000 per developable acre price.  
[83]  
Mr. Mady testified that Rosseau agreed to assume the BMO Mortgage and understood  
that it was responsible for the $200,000 penalty. Mr. Mady testified that if Rosseau was to  
assume the mortgage, he wanted something in return: “252 has no problem bettering the  
Agreement for themselves so it is only fair we get a benefit ourselves.” He suggested that the  
parties delete the requirement to pay the $400,000 second deposit to better the APS for Rosseau  
in its amended version. Mr. Mady was prepared for Rosseau to pay the $200,000 penalty under  
the BMO Mortgage and thought that the deletion of the requirement to pay the $400,000 deposit  
on the waiving of conditions was a fair trade.  
[84]  
Mr. Mady testified that he viewed the assumption of the BMO Mortgage as a penalty  
because he would have to discharge it early to obtain construction financing as part of the  
development of the Property.  
[85]  
Mr. Bagnell testified that he obtained instructions from Mr. Mady to agree to the new  
purchase price of $6,615,000 and to assume the BMO Mortgage on the basis that the requirement  
of Rosseau to pay the $400,000 deposit would be deleted.  
[86]  
What happened next is disputed by the parties. Mr. Bagnall testified that he called Mr.  
Sandhu and explained his instructions that Rosseau would only assume the BMO Mortgage if the  
requirement for the further $400,000 deposit on the waiver of conditions would be deleted. Mr.  
Bagnall testified that he told Mr. Sandhu that he had met with Rosseau and that everything was  
acceptable except the $400,000; these monies would not be due on the waiver because Rosseau  
was assuming the first mortgage. Mr. Sandhu responded that he would inform Mr. Jain.  
[87]  
In his examination in-chief, Mr. Sandhu said the requirement for the $400,000 deposit  
never changed. It was to be paid. He said he forgot to mention the $400,000 in the amended  
APS. He was supposed to mention it and forgot. He said he was supposed to delete it from the  
balance due on closing. He said he made a mistake.  
Page 29  
[88]  
In cross-examination, Mr. Sandhu agreed that after the February 2017 meeting, Mr.  
Bagnell told him that Rosseau was prepared to assume the BMO Mortgage. He was asked if Mr.  
Bagnall told him Rosseau was agreeable to assume the mortgage but did not want to pay the  
$400,000 on waiving the conditions. He said he did not recall that conversation; he then denied  
having had that conversation. He said that if the discussion had happened, it would have been  
reflected in the amended APS. He was then taken through the terms of the amended APS. He  
agreed that if Rosseau paid the $1,790,000 on closing, the $50,000 deposit already paid, assumed  
the mortgage of $1,666,000 and had a vendor take back mortgage of $3,115,000, all as set out in  
the amended APS, Rosseau would have paid the full purchase price. He was asked if the full  
purchase price is accounted for on closing, is it clear there was no further requirement by  
Rosseau to pay the $400,000? He said he forgot to mention it. He said “that is what I am saying.  
I forgot to mention this one.” He said he remembers asking for the $400,000 and asked  
rhetorically why he would ask for the monies if they were not going to be paid. He said he made  
a mistake. Mr. Sandhu said if the $400,000 was not required, why wasn’t it specifically deleted  
in the amended APS. He agreed that if Rosseau had paid $1,790,000 on closing and the $400,000  
on waiving the conditions, Rosseau would have paid too much.  
[89]  
Mr. Sandhu agreed, both in examination in-chief and in cross-examination, that the  
numbers in the amended APS added up to the stated purchase price. In-chief, counsel for the  
Defendant asked: “And there is no reference to the $400,000 deposit or how that will be  
adjusted. Do you recall whether or not you intended [it to be] adjusted?,” to which Mr. Sandhu  
responded, “if just given the total amount of the balance if this comes to … the numbers add up  
to the purchase price.” In cross-examination, Mr. Sandhu agreed the numbers in the amended  
APS added up to the purchase price.  
[90]  
Mr. Jain testified that he expected Rosseau to still pay the $400,000.  
[91]  
After the alleged call from Mr. Bagnell, Mr. Sandhu sent an email to Mr. Bagnell on  
March 1, 2017, confirming the terms for the amended agreement. The email is reproduced in full  
as follows:  
Hi Wesley,  
Page 30  
Below are the terms for the completion of transaction  
1. Adjust the price for now @ 18.9 x 350000 = 6,615,000  
2. Buyer will Pay 1.84 million to vendor and assume 1st mortgage of 1.66 million  
from BMO bearing interest of 2.49% for 5 yr term or the time till net developable  
acres got established (whichever is earlier) as vendor is avoiding to pay off due to  
penalty of 200k now. (Vendor will assume the penalty at the end of the term as it  
will be lower at that time)  
3. Vendor will take back mortgage at first position for the amount of 3,115,000  
bearing 0% interest till the net develop-able acres got established.  
4. Once the net developable acres get established buyer will pay the vendor  
amount of VTD plus/minus the value for more/less developable acres established.  
5. If the net developable acres comes out less than 18.9 acres, the amount of per  
acre @ $350000 will be deducted from VTB and vendor will get rest of the  
amount.  
For example:  
If net net developable acres come to 23 acres then buyer will pay as below:  
3,115,000 million plus 1,435,000 million (4.1 acre x 350000) total 4.55 million if  
net net developable acres comes to 18 acres then buyer will pay as below:  
3,115,000 million minus 315000 (.9 acre x 350000) total 2.7 million  
Thanx & Rgds  
Sukhpreet Sandhu  
[92]  
On March 8, 2017, Mr. Sandhu prepared an Amendment to the APS. The Amendment  
deleted certain paragraphs of the APS and inserted the following:  
INSERT;  
The new Purchase Price shall be $6,615,000 (Six Million Six Hundred and Fifteen  
Thousand Dollars) based 45.71 acres of which approximately 18.9 are natural net  
developable acres by area statistics data supplied by Glen Schnarr & Associates  
Inc. The Buyer and Seller agreed that the final natural net Developable Acres may  
vary when final studies are completed and confirmed by both and the Toronto and  
Region Conservation Authority (TRCA) and Town of Caledon and designated for  
Residential Development allowing Townhouses, semi-Detached and Singles  
Homes, and that the final price shall be adjusted accordingly based on more or  
less at $350,000 Dollars per Natural net developable acre.  
The Buyer will pay to the Seller on the date set for closing the sum of $1,790,000  
(One Million Seven Hundred Ninety Thousand CAD Dollars) plus the Deposit of  
$50,000 to be credited on closing totaling $1,840,000 dollars.  
Page 31  
The Buyer also agrees to assume, subject to approval a First Mortgage of  
approximately $1,660,000.00 (One Million Six Hundred Sixty Thousand CAD  
Dollars) from the Bank of Montreal bearing interest of 2.49% for a 5 year term or  
until Natural Net Developable acres are established. The Buyer at his sole option  
shall have the right to assume the said First Mortgage for the duration of the full  
term.  
The Seller agrees to take back a Mortgage at Second position for the amount of  
$3,115,000.00 (Three Million One Hundred and Fifty Thousand Dollars) bearing  
0% interest until the time Natural Net Developable acres are established.  
Upon the establishment of natural Net Developable acres the Second Mortgage  
shall be discharged by Buyer and shall pay the Seller the sum of $3,115,000.00  
Dollar CAD plus or minus the Natural Net Developable Acres that are  
established, payment shall be within 30 days from the date set.  
DATE SET FOR CLOSING  
In the event that Natural Net Developable Acres is not established on the date set  
for closing on page 7 of the Agreement of Purchase and Sale, then the date shall  
be extended for a further 30 days, if after the 30 period Natural Net Developable  
is not established then the closing date shall be 15 days after that date. If the land  
Registry is closed on the 15th day aforesaid, then the day of closing shall be on  
the day that the Land Registry Office is open for business, further The Title  
Search shall be at least one (1) week prior to the Completion date.  
The Buyer shall diligently move forward to minimize DD period  
d. The Amendment APS  
[93] During his testimony, Mr. Sandhu admitted that the terms of the Amendment APS were  
accurate. He admitted that the new purchase price of the Agreement was based on a calculation  
of 18.9 developable acres x $350,000 per acre. Mr. Sandhu agreed Rosseau was to pay  
$1,840,000 in cash on closing (including the $50,000 deposit), assume the BMO Mortgage of  
approximately $1.66 million and receive a vendor take back mortgage of $3,115,000 bearing  
zero interest.  
[94]  
Mr. Sandhu testified that he forgot to mention the $400,000 deposit in the amended  
APS. He acknowledged the amended APS does not say that the $400,000 is to be paid as a  
second deposit.  
Page 32  
[95]  
Mr. Sandhu admitted that if the $400,000 deposit was paid by Rosseau when it waived  
the conditions, the stipulated $1,790,000 in cash due on closing was too much given the purchase  
price and the other terms of the amended APS.  
[96]  
Mr. Mady testified that he did not think that payment of the $400,000 deposit was  
required on waiving the conditions based on the negotiations and Rosseau’s willingness to  
assume the BMO mortgage. Mr. Mady stated that he did not notice that the $400,000 deposit  
requirement was not deleted in the amended APS because he was focused on the Insert section  
which confirmed the calculation of the Purchase Price.  
[97]  
Mr. Jain agreed that the cash to be paid on closing, the assumption of the BMO  
mortgage, and the vendor take back mortgage added up to the new purchase price of $6,615,000.  
He admitted the amount of cash to be paid by Rosseau on closing could not be varied. He also  
admitted that Rosseau was not required to make a payment to BMO on closing but only to  
assume the mortgage. If an adjustment was necessary, he agreed, it would take place on closing.  
Mr. Jain admitted that the amount of the BMO Mortgage, or any adjustment to it, had nothing to  
do with the payment of the $400,000 deposit.  
III. Application of Facts to the Law  
[98]  
The only material fact in dispute is whether Mr. Bagnall told Mr. Sandhu that Rosseau  
would assume the BMO mortgage and that in return the further $400,000 deposit would not be  
payable. I find as a fact that this was communicated by Mr. Bagnell to Mr. Sandhu during the  
telephone call Mr. Bagnell testified that he had with Mr. Sandhu. Mr. Mady’s and Mr. Bagnell’s  
evidence was clear and unequivocal on this point.  
[99]  
After the February 2017 meeting of Mr. Jain, Mr. Sandhu and Mr. Bagnell, Mr. Bagnell  
spoke to Mr. Mady. Mr. Mady testified as follows concerning 252’s request that Rosseau assume  
the mortgage:  
That’s when Wes said to us that an amendment should be drafted:  
A) to recognize that the net developable is now 18.9 acres and B)  
that we will assume that mortgage that means we are responsible  
for that pay out. My comment to Wes was they have no problem  
bettering the Agreement for themselves so its only fair we get a  
Page 33  
benefit ourselves. I suggest we delete the need for $400,000 and  
that betters the Agreement for us. We agreed to pay their $200,000  
payout I thought that as a fair transaction. [I gave those]  
instructions [to Wes] and I knew he would get back to me.  
[100]  
[101]  
This evidence was not challenged in any meaningful way.  
Mr. Bagnell’s evidence was clear. He testified to receiving these instructions from Mr.  
Mady and to communicating this to Mr. Sandhu.  
[102] Mr. Sandhu’s evidence on whether this conversation took place is not at all clear. At  
first, he said he didn’t recall. Then he said it didn’t happen. Then he said he forgot the $400,000  
when drafting the amended APS and then said he made a mistake. He did not have a clear,  
independent recollection of whether he discussed the $400,000 deposit with Mr. Bagnell. He  
could only offer an inference of the events from the words of the amended APS.  
[103]  
I find as a fact that the conversation between Mr. Bagnell and Mr. Sandhu did occur as  
Mr. Bagnell described about the $400,000 and it not being payable on the waiver of conditions.  
In my view, this finding is consistent with my findings below, that based on the proper  
interpretation of the APS and amended APS, the $400,000 was not payable.  
[104]  
Mr. Jain’s evidence that he expected the $400,000 to be paid on the waiver of the  
conditions was not reasonable based on the wording of the amended APS as I have interpreted it.  
Further, Mr. Jain’s subjective interpretation is not relevant to the Court’s interpretation of the  
APS and amended APS. It is the objective intention of the parties that is relevant (Starroll, para.  
20).  
[105]  
I have read the APS and the amended APS as a whole, given the words used their  
ordinary and grammatical meaning, and considered the surrounding circumstances known to the  
parties at the time of the formation of the APS and amended APS; and viewed as a whole, I find  
that Rousseau was not required to pay a $400,000 further deposit when Rousseau waived the  
conditions in the APS and amended APS.  
[106]  
The full purchase price under the amended APS was $6,615,000. The amount due on  
closing was $1,790,000 plus the deposit of $50,000 which was paid when the APS was executed  
Page 34  
for a total of $1,840,000. Rosseau was to assume the BMO Mortgage in the amount of  
$1,660,000. 252 agreed to take a vendor take back mortgage in the amount of $3,115,000. The  
totals are as follows:  
$1,790,000 Due on closing  
$50,000 Deposit, paid when APS signed  
$1,660,000 Mortgage assumed  
$3,115,000 Vendor take back  
$6,615,000 Total stated purchase price  
[107]  
There is no provision for a $400,000 deposit in the amended APS. There is no provision  
for it to be paid and be reduced from the amount payable on closing. Any adjustment to reflect a  
variation in the net developable land was to be adjusted from the vendor take back mortgage.  
[108]  
There did not have to be an explicit deletion of the $400,000 deposit in the amended  
APS as it is clear by the terms of the amended APS that it was no longer payable. Otherwise, if  
Rousseau paid the $400,000 and the closing amount, Rosseau would have overpaid by $400,000.  
[109]  
Further, the second paragraph of the “INSERT” portion referred only to the $50,000  
deposit paid when the APS was signed to be credited on closing and there was no reference to  
the $400,000.  
[110]  
I specifically find on the evidence that as a matter of fact Rosseau formed an intention  
that the $400,000 deposit would not be required to be paid, and did communicate this to 252 by  
Mr. Bagnell speaking to Mr. Sandhu. This was done before the amended APS was executed.  
[111]  
252 argued that the parties intended for the $400,00 to be credited to the purchase price  
and that there was no “practical difficulty” with the payment of the second deposit and the  
amended APS. In my view, there was a practical difficulty with the $400,000 deposit and the  
Page 35  
amended APS co-existing. The amount due on closing would be incorrect if the $400,000 was  
already paid and there is no mechanism in the amended APS to change the amount due on  
closing. All witnesses agree that when the amounts in the amended APS were added together it  
totalled the purchase price. Mr. Jain acknowledged in his evidence that there was no language in  
the amended APS by which to reduce the amount Rosseau was to pay on closing.  
[112]  
The deletion of the $400,000 further deposit requirement is supported by the context of  
the negotiation. Deleting the deposit was consistent with Rosseau assuming the BMO Mortgage.  
[113]  
252 argued that Mr. Jain, Mr. Sandhu, and Mr. Bagnell did not discuss the deletion of  
the $400,000 deposit at their February 2017 meeting. This is accurate; however, this ignores the  
timeline of events. 252 proposed at the meeting that Rosseau assume the BMO Mortgage. Mr.  
Mady testified that once he learned that 252 wanted Rosseau to assume the mortgage and the  
penalty, he wanted something in return. The $400,000 deposit was not discussed at the meeting  
because Mr. Mady raised it after the meeting in his discussion with Mr. Bagnell, in response to  
252’s request for Rosseau to assume the BMO mortgage. Mr. Bagnall communicated this to Mr.  
Sandhu.  
ISSUE 2 - Was the Plaintiff purchaser ready, willing, and able to close the APS and amended  
APS on September 19, 2017?  
I. The Law  
[114]  
The answer to this question involves a consideration of two legal concepts: anticipatory  
breach and whether an anticipatory breach relieves the other party from obligations under an  
agreement to tender. 252’s position also involves a consideration of the “group enterprise  
theory.”  
[115]  
As set out in Nutzenberger v. Mert, 2021 ONSC 36, at para. 5, an anticipatory breach  
occurs where one party to a contract repudiates the contract before performance is due. The  
anticipatory breach or repudiation may be express or implicit, communicated by words or  
conduct of the defaulting party, that the defaulting party may not or cannot perform the terms of  
the contract.  
Page 36  
[116]  
The Ontario Court of Appeal described anticipatory breach in Spirent Communications  
of Ottawa Limited v. Quake Technologies (Canada) Inc., 2008 ONCA 92, 88 O.R. (3d) 721, at  
para. 37:  
[37] I would add this. When considering Spirent's conduct, it was important to  
keep in mind that what was involved was an anticipatory breach of contract. An  
anticipatory breach sufficient to justify the termination of a contract occurs when  
one party, whether by express language or conduct, repudiates the contract or  
evinces an intention not to be bound by the contract before performance is due.  
See Pompeani v. Bonik Inc. (1997), 1997 CanLII 3653 (ON CA), 35 O.R. (3d)  
417, [1997] O.J. No. 4174 (C.A.). To assess whether the party in breach has  
evinced such an intention, the court is to ask whether a reasonable person would  
conclude that the breaching party no longer intends to be bound by it. See  
McCallum v. Zivojinovic (1977), 1977 CanLII 1151 (ON CA), 16 O.R. (2d) 721,  
[1977] O.J. No. 2341 (C.A.). Having said that, when determining whether such an  
intention has been evinced, the courts rely on much the same analysis as they do  
in respect of claims of fundamental breach. That is, in determining whether the  
party in breach had repudiated or shown an intention not to be bound by the  
contract before performance is due, the court asks whether the breach deprives the  
innocent party of substantially the whole benefit of the contract.  
[117]  
The rights conferred on an innocent party where there is an anticipatory breach were  
described by the Ontario Court of Appeal in Place Concorde at para. 50:  
[50] Thus, a repudiatory breach does not automatically bring an end to a contract.  
Rather, it confers a right upon the innocent party to elect to treat the contract at an  
end thereby relieving the parties from further performance. As a general rule, the  
innocent party must make an election and communicate it to the repudiating party  
within a reasonable time: see Chapman v. Ginter 1968 CanLII 72 (SCC), [1968]  
S.C.R. 560 at 568. However, in some cases the election to treat the contract at an  
end will be found to have been sufficiently communicated by the innocent party’s  
conduct: John D. McCamus, The Law of Contracts, (Toronto: Irwin Law Inc.,  
2005) at pp. 641-42.  
[118]  
If an innocent party rejects a repudiation of an agreement, they must show that they are  
ready, willing, and able to compute a transaction on the closing date. The leading case for this  
principle is the Ontario Court of Appeal’s decision in Domicile.  
[119]  
The facts in Domicile were set out under the heading “The Facts” as follows:  
On February 1, 1995, MacTavish and Domicile signed an agreement of purchase  
and sale by which MacTavish agreed to buy a semi-detached house in Ottawa to  
Page 37  
be built by Domicile. The purchase price was $450,000. The agreement called for  
a $5,000 deposit on execution of the agreement and a further $15,000 deposit on  
notice that a building permit had been obtained. MacTavish was to obtain vacant  
possession on the closing date, September 15, 1995. If the house was substantially  
completed on September 15, 1995, MacTavish was obliged to complete the  
transaction. The agreement provided that the house was deemed to be  
substantially completed when a municipal occupancy permit was issued.  
Typically, and importantly in this case, the agreement stated that "time shall in all  
respects be of the essence hereof.  
MacTavish paid the $5,000 deposit when he signed the agreement. However, two  
and one-half months later, on April 13, 1995, he repudiated the agreement. His  
lawyer wrote Domicile that "our client has no intention of proceeding with the  
purchase of the property" and asked for the return of the $5,000 deposit. Domicile  
chose not to accept MacTavish's anticipatory repudiation. Instead its lawyer wrote  
that the deposit would not be returned and that "Domicile remains ready, willing  
and able to perform its side of the bargain."  
On July 7, 1995, Domicile obtained a building permit for the house. On July 19,  
1995, Domicile's lawyer wrote MacTavish's lawyer reiterating that Domicile did  
not accept MacTavish's anticipatory repudiation of the agreement, that Domicile  
considered the agreement in force and that it would "pursue the remedies  
available to it under these circumstances." The letter also notified MacTavish of  
the building permit and asked for the further $15,000 deposit required by the  
agreement. MacTavish did not pay this deposit.  
On August 15, 1995, Domicile's lawyer wrote another letter to MacTavish's  
lawyer, again saying that Domicile did not accept the repudiation and that it  
considered the agreement to still be in effect. On the same day Domicile issued a  
statement of claim, seeking specific performance of the agreement or  
alternatively, damages. The trial judge found that "Domicile did not accept  
MacTavish's repudiation, but elected to keep the contract alive and proceed with  
the construction which commenced on July 15, 1995, after approvals were  
obtained from the city."  
However, on the closing date, September 15, 1995, Domicile had not substantially  
completed the house. Therefore neither party tendered on the closing date.  
MacTavish did not intend to close and Domicile had not finished the house.  
Indeed the house was not substantially completed until May 1996. At no point did  
Domicile give MacTavish notice of a new closing date.  
Meanwhile housing prices in Ottawa declined in late 1995 and early 1996. On  
February 21, 1996, Domicile agreed to sell the house to one of its shareholders for  
$365,000-$85,000 less than the price MacTavish had agreed to pay. A municipal  
occupancy permit for the house was issued in early May. Thus, as the trial judge  
found: "the house was not completed and ready for occupancy until May 3,  
1996." Domicile closed the transaction with its shareholder that day.  
Page 38  
At trial Domicile sought damages. The trial judge awarded Domicile damages of  
$97,975.88, representing the difference in the sale price less the $5,000 deposit  
($80,000) and Domicile's cost of carrying the house between September 15, 1995  
and May 3, 1996 ($17,975.88). MacTavish appeals against the finding of liability  
and raises several grounds of appeal against the award of damages. I will deal  
only with liability because in my view the trial judge erred in finding MacTavish  
liable.  
[120]  
The analysis in Domicile is set out under the heading “Discussion” as follows:  
In April 1995, MacTavish stated that he did not intend to close the transaction.  
His conduct amounted to an anticipatory repudiation of the agreement. On being  
notified of MacTavish's anticipatory repudiation, Domicile, the innocent party,  
had a choice: it could "accept" or reject the repudiation. Had Domicile "accepted"  
the repudiation it would have been discharged from closing the transaction and  
could have sued for damages for breach of contract. [See Note 1 at end of  
document] Domicile, however, rejected the repudiation and therefore the  
agreement remained in effect. Because of the view I take of this case, I need not  
consider the difficult and important question whether in April 1995 Domicile  
should have taken reasonable steps to reduce its losses, instead of ignoring the  
repudiation and waiting for the closing date. [See Note 2 at end of document]  
Because Domicile's rejection of MacTavish's anticipatory repudiation kept the  
agreement alive, time remained of the essence. A time is of the essence provision  
means that on the closing date an innocent party may treat the contract as ended  
and sue the defaulting party for damages or it may keep the contract alive and sue  
for specific performance or damages. [See Note 3 at end of document] In order to  
take advantage of a time of the essence provision the innocent party must itself be  
"ready, desirous, prompt and eager" to carry out the agreement. [See Note 4 at end  
of document] Domicile could not satisfy this requirement on the closing date.  
Because it had not yet substantially completed construction of the house it could  
not carry out the agreement. Equally MacTavish could not rely on the time of the  
essence provision to end the agreement. A time of the essence provision can be  
raised as a defence only by a party who is ready, willing and able to close on the  
agreed date and MacTavish was not ready, willing and able to close on September  
15, 1995. [See Note 5 at end of document]  
Therefore, on the closing date neither Domicile nor MacTavish was entitled to  
enforce or end the agreement. A similar situation arose in King v. Urban &  
Country Transport Ltd. (1974), 1973 CanLII 740 (ON CA), 1 O.R. (2d) 449, 40  
D.L.R. (3d) 641, a decision of this court relied on by Binks J. In King v. Urban,  
the purchaser was not in a position to close on the closing date; but the vendor  
was also in default and not entitled to rely on the time of the essence provision in  
the contract. Arnup J.A. resolved the stalemate by applying two propositions (at  
pp. 454-56):  
Page 39  
1. When time is of the essence and neither party is ready to close on the  
agreed date the agreement remains in effect.  
2. Either party may reinstate time of the essence by setting a new date for  
closing and providing reasonable notice to the other party.  
An important corollary of Arnup J.A.'s second proposition is that a party who is  
not ready to close on the agreed date and who subsequently terminates the  
transaction without having set a new closing date and without having reinstated  
time of the essence will itself breach or repudiate the agreement. [See Note 6 at  
end of document]  
The corollary applies to the facts of this case. Domicile did not give MacTavish  
reasonable notice of a new closing date. Instead it unilaterally ended the  
agreement by selling to a third party and seeking damages from MacTavish.  
Because it did not reinstate time of the essence by setting a new closing date,  
Domicile was not entitled to end its agreement with MacTavish. Therefore, in  
failing to give MacTavish an opportunity to close the transaction after September  
15, Domicile itself breached the agreement. Because of Domicile's breach,  
MacTavish could no longer be held liable. The trial judge came to the opposite  
conclusion because he did not consider the effect of Domicile's inability to close  
on September 15. As a consequence, he did not consider Domicile's obligation to  
set a new closing date on reasonable notice to reinstate time of the essence.  
Domicile's conduct is similar to the conduct of the vendor in Kwon v. Cooper,  
[See Note 7 at end of document] another decision of this court dealing with a real  
estate transaction in which time was of the essence. In Kwon the purchaser was  
not ready to close on the closing date. The vendor, in a letter delivered the day  
before closing, said that he would rely on the terms of the contract requiring  
closing the following day. When the agreement did not close the vendor sued for  
damages. However, this court held that on the closing date, the vendor also was  
not ready, willing and able to close because he did not have a discharge of the  
existing first mortgage or the guarantee required by the agreement of purchase  
and sale. The vendor, therefore, could not rely on King v. Urban and his action for  
damages failed.  
Similarly, Domicile's action must fail. Having decided to keep the agreement  
alive and then having been unable to carry out its part of the bargain on closing,  
Domicile could not continue to hold MacTavish liable without also giving  
MacTavish a further and reasonable opportunity to perform.  
Requiring that time of the essence be reinstated by giving notice of a new closing  
date is sensible and produces a just result. This requirement also ensures that the  
cost of carrying the property will be properly allocated between the vendor and  
the purchaser. To be effective the new closing date must be reasonable. And,  
although a provision making time of the essence may be implied from the  
surrounding circumstances or from the conduct of the parties, to avoid any dispute  
the notice should state that time is of the essence for this new date. [See Note 8 at  
end of document]  
Page 40  
I would allow the appeal and set aside the judgment of Binks J. In its place I  
would issue a judgment dismissing Domicile's action with costs and ordering it to  
return to MacTavish his $5,000 deposit together with accrued interest. MacTavish  
is also entitled to his costs of the appeal.  
[121]  
The Court of Appeal in Domicile referred to its previous 1996 decision in Kwon. The  
Court of Appeal in Kwon faced a similar situation and came to the same determination.  
[122] The Court of Appeal, in 1179 Hunt Club, followed its earlier decisions in Domicile and  
Kwon and dismissed the appeal of a vendor who had refused to accept the repudiation of a  
purchaser. The vendor in Hunt Club had insisted on completing the agreement on a closing date  
but could not itself close on that date.  
[123]  
In Hunt Club the purchaser of a condominium unit had communicated that it did not  
intend to complete the agreement on the closing date but the vendor stated that it did not accept  
the repudiation and insisted that the contract be performed on the closing date. When the closing  
date arrived the vendor, through no apparent fault of its own, had a problem with the registration  
of its condominium plans at the Land Registry Office. The application judge had found, as a  
result, that the vendor could not have conveyed the condominium unit on the closing date.  
[124]  
In Hunt Club Justice Lauwers agreed with the determination made by the application  
judge that the vendor’s inability to close on its own specified closing date brought the agreement  
to an end. He stated at para. 21 as follows:  
Domicile Developments states that when time is of the essence and  
neither party is ready to close on the agreed date, the agreement  
remains in effect. By contrast, here the vendor not only refused to  
accept the repudiation but insisted that the transaction close on  
November 28, specifying the consequences if that did not occur,  
including the immediate pursuit of legal remedies. The application  
judge concluded that, in light of that insistence, because the vendor  
was not ready on November 28, the agreement came to an end.  
[125]  
Justice Lauwers concluded at paras. 23 and 26 that the vendor, in insisting on closing  
on the closing date, needed to establish that it was ready to close on that closing date:  
Having refused to accept the purchaser’s repudiation of the agreement, and having  
insisted on perfection in the purchaser’s performance, the vendor was required to  
Page 41  
render perfection in its own performance and it did not. The vendor’s failure to  
tender on November 28, 2017 was fatal This strict approach is not unusual in the  
law, in view of the maxim “he who seeks equity must do equity”, or in life, where  
the proverbial caution that “he who lives by the sword dies by the sword.” Both  
resonate.  
xxx  
In this case, the issue is not whether the vendor could have been ready to close on  
November 28, 2017, but that it was not ready to close on that date, a date on  
which it insisted. Hence the controversy was not material.  
[126]  
These principles are also set out at paras. 60 - 66 of Spiridakis v. Li, 2020 ONSC 2173:  
[60]  
The defendants concede that they failed to close the purchase of the  
plaintiffs’ home on October 30, 2017 as scheduled. But they assert that the  
plaintiffs failed to tender on them – to demonstrate that they were ready, able and  
willing to close the deal.  
[61]  
Tendering is not a prerequisite to an entitlement to damages for breach  
of an agreement of purchase and sale. But where a plaintiff relies on a  
defendant’s failure to close as the breach giving rise to the entitlement of  
damages, the plaintiff must be able to demonstrate that he or she was ready,  
willing and able to close. Tendering is generally considered to be the best  
evidence of that readiness, willingness and ability.  
[62]  
Having said that, the law is quite clear that an innocent party need not  
go through the meaningless exercise of tendering in circumstances of anticipatory  
breach.  
[63]  
The phrase “anticipatory breach” was explained by Justice Cromwell  
in dissenting reasons in Potter v. New Brunswick Legal Aid Services Commission,  
2015 SCC 10 at para. 149:  
An anticipatory breach "occurs when one party manifests, through  
words or conduct, an intention not to perform or not to be bound  
by provisions of the agreement that require performance in the  
future": McCamus, at p. 689; see also A. Swan, with the assistance  
of J. Adamski, Canadian Contract Law (2nd ed. 2009), at s. 7.89.  
When the anticipated future non-observance relates to important  
terms of the contract or shows an intention not to be bound in the  
future, the anticipatory breach gives rise to anticipatory  
repudiation.  
[64]  
As I noted above, the parties agreed that “time was of the essence” in  
relation to the performance of their respective obligations under the agreement of  
purchase and sale. In other words, they agreed that the time limit manifested by  
the fixed closing date was an essential term, such that the breach of it would  
permit the innocent party to terminate the agreement. When the defendants  
Page 42  
manifested an intention not to complete the transaction on October 30, 2017, the  
plaintiffs were released from any obligation to tender in order to prove that they  
were ready, willing and able to close. See Di Millo v. 2099232 Ontario Inc., 2018  
ONCA 1051, at paras. 31 and 49.  
[65]  
In this case there is a factual dispute about whether the plaintiffs in fact  
tendered. It does not matter. The defendants’ lawyer undeniably communicated  
to the plaintiffs’ lawyer that the defendants were not in a position to close on the  
scheduled closing date.  
The plaintiffs’ lawyer correctly identified that  
communication as an anticipatory breach. The plaintiffs were relieved of any  
obligation to tender in order to establish that they were ready, willing and able to  
close.  
[66]  
I conclude that the “tender issue” does not require a trial to resolve.  
The plaintiffs were not required to tender.  
[127]  
The issue of tender in circumstances where one party has repudiated the agreement is  
set out by the Ontario Court of Appeal at para. 45 of Pompeani:  
45 I think that, taken cumulatively, Bonik's actions in abandoning the plan made part  
of the agreement, securing the registration of the new plan, ignoring correspondence from  
Pompeani's solicitor for over a year before the date of closing, demanding the profits  
from the flip in return for closing and failing to submit a draft deed or statement of  
adjustments would lead a reasonable purchaser to believe that the vendor would not  
honour its obligations under the agreement. Accordingly, I think that Bonik impliedly  
repudiated the agreement before the date of closing, thus relieving Pompeani of his  
obligations under the agreement and entitling him to damages. I do not think that in the  
circumstances Pompeani was obligated to tender.  
[128]  
[129]  
This is also stated at para. 49 of Di Millo:  
[49] Thus, when a party by words or conduct communicates a decision not to  
proceed to closing, the other party is released from any obligation to tender in  
order to prove he was ready, willing and able to close: see Kirby v. Cameron,  
1961 CanLII 203 (ON CA), [1961] O.R. 757 (C.A.); Kloepfer Wholesale  
Hardware v. Roy, 1952 CanLII 8 (SCC), [1952] 2 S.C.R. 465.  
A similar statement was set out at para. 104 of Silverberg:  
[104] Mr. Simaan does not rely on the “time of the essence” clause in the  
agreement of purchase and sale and does not suggest that the Purchaser’s failure  
to make formal tender on that date is a bar to specific performance. There is good  
reason why he takes this position, as it is settled law that a party may not rely on  
time of the essence where (a) the party itself was not ready, willing and able to  
close on the agreed date; or (b) the party has itself been the cause of the delay; or  
Page 43  
(c) the party has waived its right to rescind. As Mr. Justice McKay, giving the  
judgment of the Court of Appeal in Shaw v. Holmes, (1952), 1952 CanLII 285  
(ON CA), 2 D.L.R. 330 (Ont. C.A.) said at 334 :  
Time may be insisted upon as of the essence of the agreement by a litigant, (a)  
who has shown himself ready, desirous, prompt and eager to carry out his  
agreement: Mills v. Haywood (1877), 6 Ch. D. 196; (b) who has not been himself  
the cause of the delay or in default; Snell v. Brickles (1914), 1914 CanLII 561  
(SCC), 20 D.L.R. 209, 49 S.C.R. 360; rev’d. 1916 CanLII 417 (UK JCPC), 30  
D.L.R. 31, [1916] 2 A.C. 599; and (c) who has not subsequently recognized the  
agreement as still subsisting; he must not play fast and loose at his pleasure:  
Springer v. Gray (1859), 7 Gr. 276; Cudney v. Gives (1890), 20 O.R. 500; Labelle  
v. O’Connor (1908), 15 O.L.R. 519, and Harris v. Robinson (1892), 1892 CanLII  
14 (SCC), 21 S.C.R. 390.  
[130]  
In response to Rosseau’s position that it was ready to close with money from other  
corporations, 252 relies on the “corporate separateness principle.” The Court of Appeal for  
Ontario addressed this in Chevron. 252 specifically referenced paras. 68, 76 and 77:  
[68] The Supreme Court of Canada has protected the principle of corporate  
separateness without suggesting a stand-alone just and equitable exception. In Sun  
Indalex Finance, LLC v. United Steelworkers, [2013] 1 S.C.R. 271, [2013] S.C.J.  
No. 6, 2013 SCC 6, at para. 238, Cromwell J. rejected the submission that a  
subsidiary should be liable for a breach of fiduciary duty committed by its parent  
corporation, holding that "unless there is a legal basis for ignoring the separate  
corporate personality of separate entities, those separate corporate existences must  
be respected". See, also, Continental Bank Leasing Corp. v. Canada, 1998 CanLII  
794 (SCC), [1998] 2 S.C.R. 298, [1998] S.C.J. No. 63, at paras. 108-12.  
***  
[76] Not only is such an argument problematic from a policy standpoint, it comes  
dangerously close to the adoption of the group enterprise theory of liability. That  
theory holds that where several corporations operate closely as part of the same  
"group" of corporations, they are in reality a single enterprise and should,  
accordingly, be responsible for each other's debts. It has been consistently rejected  
by our courts: Meditrust Healthcare Inc. v. Shoppers Drug Mart (2002), 2002  
CanLII 41710 (ON CA), 61 O.R. (3d) 786, [2002] O.J. No. 3891 (C.A.), at paras.  
30-31; and Fairview Donut Inc. v. The TDL Group Corp., [2012] O.J. No. 834,  
2012 ONSC 1252 (S.C.J.), at paras. 651-65, affd [2012] O.J. No. 5775, 2012  
ONCA 867, 225 A.C.W.S. (3d) 31, leave to appeal to S.C.C. refused [2013]  
S.C.C.A. No. 47.4 It has also been rejected in England: see Adams v. Cape, [1990]  
1 Ch. 433 (Eng. C.A.), at pp. 532 and 536-38.  
[77] There is good reason for this rejection. There is a difference between  
economic reality and legal reality. The fact that on an operational level corporate  
Page 44  
separateness is more nuanced among a group of related corporations is of no  
moment. It is the legal reality, as provided for in the relevant business corporation  
statutes, that counts. The CBCA permits subsidiary corporations but also says that  
each corporation is a natural person. [page25 ]If Parliament wished to carve out  
an exception to the natural person rule for subsidiaries, it would have been very  
easy to do so.  
II. The Evidence  
a) Events after the amended APS  
[131]  
Rosseau conducted its due diligence. Mr. Mady testified that in June 2017, he retained  
Mr. Quarcoopome at Weston Consulting to advise him of the planning status of the Property and  
other related issues.  
[132]  
Mr. Mady testified that based on his own considerable real estate development  
experience, prior to waiving the conditions, he estimated the development costs for the Property;  
including how much money it would cost to service the land. Among other things, he took into  
consideration development charges and related costs. He estimated the revenue for the Property.  
Mr. Mady testified that he performed his own high-level analysis of profit. He testified that he  
has a lot of experience in doing this type of analysis. He said: “I estimate the cost. I estimate the  
revenue and come up with profit potential and I satisfy myself.”  
[133]  
Mr. Mady also testified that he called Mr. Quarcoopome and ran the numbers he used  
in his high-level analysis by Mr. Quarcoopome since Mr. Quarcoopome is more current than Mr.  
Mady on the appropriate numbers. Mr. Mady obtained additional comfort from Mr.  
Quarcoopome concerning his analysis. Mr. Mady’s evidence on this point was corroborated by  
Mr. Quarcoopome.  
[134]  
Mr. Mady testified that he was looking for a rate of a return of 20 per cent to 25 per  
cent for the development of the project to be viable.  
[135]  
252 takes the position that Rosseau started its due diligence in July 2017. Mr.  
Quarcoopome wrote to Mr. Bagnell and Rosseau by email on July 25, 2017, attaching a “concept  
plan that incorporates that development limit set on the Glen Schnarr plan.” He wrote to Mr.  
Bagnell and TRG by email on August 21, 2017, in which he attached consulting proposals “for  
Page 45  
the Mayfield site walk.” Mr. Quarcoopome wrote to TRCA, Mr. Bagnell, and Mr. Mady with  
several emails on September 11, 2017, regarding “our site walk tomorrow.” Mr. Quarcoopome  
stated that TRCA requested that an Ontario Land Surveyor be on site “to define the development  
limit.” Rosseau did not hire a surveyor and was using a survey firm’s GPS to stake the limit. Mr.  
Quarcoopome advised that TRCA stated that they will not “sign off on a development limit that  
has not been surveyed by an OLS.” He further stated in that email that “if you need an approved  
limit by TRCA as part of a land purchase, that is an additional step.” That additional step was not  
taken by Rosseau.  
[136]  
I find as a fact that Rosseau started its due diligence in June 2017. It is not for 252 to  
say what Roseau is required to do to conduct its due diligence. As set out below Rosseau  
unequivocally waived the conditions.  
[137]  
I accept the evidence of Mr. Mady that he conducted a high-level analysis of the  
profitability of the project before Rosseau waived the conditions on June 7, 2017. Mr. Mady  
testified that on all projects he analyzes the cost of land, and estimates the site services for storm,  
sanitary, and water. He testified as follows:  
It was my own high-level analysis of profit. I have to determine if  
the project is profitable. I have a lot of experience in doing this. I  
estimate the cost. I estimate the revenue and I would come up with  
profit potential and I satisfied myself. Additionally, I called Martin  
and I run it by him since he is more current than I am. He has the  
latest data and access to [information]. I get an additional comfort  
from him and then nothing happens after that.  
[138]  
Mr. Mady testified that during the due diligence period he conducted a “high level”  
economic feasibility projection that he ran by Mr. Quarcoopome. Mr. Mady testified:  
Q. Let’s be clear, it was not what would you do but what did you  
do on this project?  
A. I sat down and made notes of what all the costs would be. I  
write down land cost estimates. What is then is I [calculate] how  
much money it would costs to service. I take into consideration  
development charges from municipality and from the region and  
all the building permit costs, what am I going to pay my surveyor,  
my lawyer, high level estimated costs for every dollar you would  
Page 46  
spend to get the project developed and ready to sell and then I  
came up with X dollars then you estimate what your revenue  
would be and fit here is a profit then you are good.  
Q. What did you do?  
A. I did exactly that.  
Q. Did you keep it?  
A. I don’t have them now. I literally do them with pad and pen  
then run them by planner. If he says “yes you are good to go” then  
when it comes to financing, I send them to my [financial guy] and  
he would put in it in a format for the investors and the bankers. For  
me, its literally one page.  
b) Waiver of Conditions  
[139] On June 7, 2017, Rosseau waived the conditions under the APS and amended APS.  
Rosseau took the position that the APS and amended APS were firm and binding. Rosseau’s  
lawyer, Chris Haber stated: “My clients intend to proceed with the deal in accordance with the  
terms contained therein.”  
[140]  
On June 13, 2017, Mr. Mangat, on behalf of 252, wrote to Mr. Haber. In his letter, Mr.  
Mangat, inter alia, stated that: “My client treats this Agreement as null and void.” In this  
communication and in the July 4, 2017, communication referenced below, 252 took the position  
that the failure to pay the $400,000 by Rosseau constituted a repudiation of the APS.  
[141]  
On June 15, 2017, Mr. Haber, responded to the Mr. Mangat’s June 13, 2017, letter and  
stated, inter alia, that the agreement was not null and void.  
[142]  
On July 4, 2017, litigation counsel to 252, James MacDonald, wrote to Mr. Haber. Mr.  
MacDonald stated that the agreement is at an end. He advised that the $50,000 deposit under the  
agreement would be returned.  
[143]  
On July 5, 2017, Mr. Mangat returned the $50,000 deposit to Mr. Haber. The certified  
cheque was dated June 28, 2017, and payable to Rosseau.  
[144]  
On September 1, 2017, Mr. MacDonald emailed Mr. Haber and confirmed that: “His  
client's position remains as set out in his June 21, 2017 correspondence.”  
Page 47  
[145]  
When 252 took the position that the APS and amended APS was at an end, Mr. Jain  
knew that the value of the Property had increased from January of 2017. He had received calls  
from agents or brokers interested in the Property. On April 8, 2017, he received an offer to  
purchase the Property from New World Petroleum for $11 million.  
[146]  
On September 21, 2017, Mr. Jain received a Letter of Intent from Vandyk Group at  
$640,000 per developable acre.  
[147]  
In September 2017, 252 also received an offer from the Rabinowicz Group to purchase  
the Property for $14 million.  
c) The Closing:  
[148]  
Mr. Haber wrote to Mr. MacDonald on August 3, 2017, stating that “since the net  
Development Acres has not been established the closing (August 5, 2017) is extended [by 30  
days] to September 4, 2017.” Mr. Haber stated in that letter that Rosseau was “ready, willing and  
able to complete the purchase.”  
[149]  
[150]  
Rosseau commenced this action on August 18, 2017, claiming specific performance.  
On August 31, 2017, Mr. Haber further wrote to Mr. MacDonald and extended the  
closing date from September 4, 2017 to September 19, 2017.  
[151] The parties agree that the Rosseau did not tender. Mr. Haber did not prepare or send  
any tender or closing documents. Mr. Mady testified that Mr. Haber advised him that tender was  
not necessary when the other party has repudiated the contract. Similarly, 252 did not prepare for  
closing.  
[152]  
It is uncontroverted that Mr. Haber was not put in funds to complete the transaction on  
September 19, 2017. It is also uncontroverted that neither Mr. Haber nor Rosseau communicated  
with anyone that day in respect to the closing and no further closing date was set by Rosseau.  
[153]  
252 did not provide any contact information to Rosseau to facilitate Rosseau assuming  
the BMO mortgage. Mr. Mady and Mr. Mehlenbacher testified that because 252 stated it would  
not close the transaction in June 2017, Rosseau did not pursue the assignment.  
Page 48  
d) Was Rosseau Ready, Willing and Able to Close the Transaction?  
[154]  
Rosseau is affiliated with three other companies: The Condo Store Realty Inc., the  
Condo Store Marketing Systems Inc., and the Insider Condo Club Ltd. Mr. Mehlenbacher  
founded each of these companies and each carry-on business in the real estate industry:  
a) The Condo Store Realty Inc. is a real estate broker. The company represents  
individual investors purchasing pre-construction condos as a block. The company  
sources new condo developments, negotiates deals with the developer to purchase  
the majority or all the units, and facilitates purchases for its investors. It earns  
commission on each sale;  
b) The Condo Store Marketing Systems Inc. has been in business since 2007 and  
earns commissions on a transaction basis; and,  
c) The Insider Condo Club Ltd. provides a membership-based service to realtors  
in the GTA. It pools resources to give its members access to pre-construction  
condos.  
[155]  
Rosseau was incorporated to re-invest some of the returns generated by the Condo  
Store Realty Inc. Mr. Mehlenbacher stated that the affiliated companies use the Condo Store  
Realty Inc. as their bank account because it always has surplus revenue. It funds the other  
businesses through inter company loans.  
[156]  
Mr. Mehlenbacher testified that typically Rosseau finances its own projects by creating  
a limited partnership comprised of its own investors who would finance 85 per cent of the  
investment needed with Rosseau contributing up to 15 per cent.  
[157]  
Mr. Mehlenbacher also testified that Rosseau does not always create a limited  
partnership. In this case they did not create a limited partnership because they were told in June  
2017, three months prior to the closing date, that 252 was refusing to close the transaction. Mr.  
Mehlenbacher testified: “At that stage we had funds to close ourselves. It is not good practice to  
go to investors with the project and have them move money or ensure the money available and  
then not be able to use it.” Mr. Mehlenbacher testified that he did not approach any investors in  
connection with the acquisition of the Property because he usually does so 45 days prior to  
closing.  
Page 49  
[158]  
Mr. Mehlenbacher testified, in 2017, Rosseau had about 400 investors in its investor  
pool. When the Company began, investors typically invested $150,000 to $250,000 into the  
limited partnership for each project. Now investors typically invest in the $1,000,000 to  
$2,000,000 range. The Company targets a rate of return of 25 per cent but usually ends up  
around 20 per cent.  
[159]  
Rosseau produced bank statements from its related companies’ accounts (collectively  
the “Accounts”). The statements show that on September 19, 2017, Rosseau had $1,942,311.91  
available on deposit to pay the $1,790,000 due on closing. Mr. Mehlenbacher testified that the  
cash in the Accounts was available to Rosseau to fund the deposit and the cash due on closing.  
The source of the funds is primarily commission income which is received by the related  
companies throughout the year. Rosseau did not, itself, have sufficient funds to close on  
September 19, 2017. It had $195,567.38 in its two bank accounts. This amount is included in the  
$1,942,311.91 above.  
[160]  
Mr. Mehlenbacher testified that the Rosseau related companies had funds on account to  
pay the cash due on closing date, on June 7, 2017, when it waived the conditions and on  
September 19, 2017. At closing, there was $1,942,311.91 in cash in the accounts. Mr.  
Mehlenbacher testified that intercompany loans between Rosseau and other companies are  
documented by ledger transfer. There are no written agreements concerning the transfer of  
money between the companies.  
III Application of Facts to the Law  
[161]  
I find as a fact that 252 repudiated the APS and amended APS in June of 2017 before  
the performance was due. This anticipatory breach or repudiation was express and  
communicated both by words and the conduct of 252. As I have found above, the further  
$400,000 deposit was not payable by Rosseau at the time of waiver of the conditions. 252  
repudiated the contract when it said in writing, through its counsel, multiple times, that it  
considered the APS and amended APS at an end and returned the $50,000 deposit and 252  
clearly expressed an intention not to be bound by the contract before performance was due. 252  
Page 50  
had no intention of completing the APS. In June of 2017, it expressly said the APS and amended  
APS were at an end. 252 was in anticipatory breach of the APS.  
[162]  
As set out in Place Concord, para. 50, a repudiatory breach does not automatically  
bring an end to a contract. I find as a fact that Rosseau confirmed the closing date of September  
19, 2017. It elected to reject the anticipatory breach of the APS and amended APS by 252.  
[163]  
I find that Rosseau was ready, desirous, prompt, and eager to carry out the APS and  
amended APS as required by Domicle, at the 2nd paragraph under Discussion. 252 argues that  
Rosseau did not want to close the transaction because the net developable land was reduced from  
30 acres to 8.27 acres. There are several problems with this argument: First, the reduction from  
30 to 8.27 acres did not occur until after the closing date; second, this argument is not supported  
by the evidence.  
[164]  
At para. 13 of 252’s written submissions, 252 states that Mr. Mady testified that he was  
“disappointed” when the developable acreage was reduced from 30 acres to 18.9 acres in  
February or March of 2017. Mr. Mady’s testimony was: “We were a little disappointed. But the  
Property was still very viable and I knew we had the price adjustment so it didn’t matter”. This  
was not an indication that Rosseau was not eager to close.  
[165]  
At para. 38 of 252’s written submissions, 252 repeats that Mr. Mady was disappointed  
in the reduction from 30 to 18.9 in developable acres and adds that Mr. Mady in his testimony at  
trial agreed that he said he was shocked in an answer at his discovery. There are two problems  
with 252’s submissions in this regard. First, 252’s trial counsel did not impeach Mr. Mady on  
this point. He did not show him the discovery transcript and then ask Mr. Mady if he agreed or  
disagreed. Trial counsel asked, “you said you were shocked by this?” Mr. Mady’s answer was  
“we were surprised for sure.” Secondly, 252 has used this evidence to suggest that a further  
reduction from 18.9 acres to 8.28 acres must have caused Rosseau to rethink the viability of the  
project. This is pure conjecture and is inconsistent with the evidence.  
[166]  
Both Mr. Mady and Mr. Mehlenbacher testified that Rosseau was still interested in the  
Property after the reductions in the net developable acres. Between April and June of 2017, 252  
Page 51  
received at least three offers for the Property. Further, Mr. Jain testified that in 2017 he received  
calls from prospective purchasers interested in the Property.  
[167]  
As set out above, 252 took the position that Rosseau did not start its due diligence until  
July of 2017. I have found otherwise. I have accepted the evidence of Mr. Mady that Rosseau did  
its due diligence.  
[168]  
At para. 37 of 252’s written submissions, 252 states that Rosseau failed to produce an  
“extensive feasibility study” for the Property and shared it with Mr. Quarcoopome. 252 asks the  
Court to draw an adverse inference because this “extensive feasibility study” was never  
disclosed. I reject this argument. No one testified that an extensive feasibility study was  
completed for the Property.  
[169]  
Mr. Mady testified that an extensive feasibility report would have been done later for  
investors but since the transaction did not close it was never prepared.  
[170]  
Based on the above, in my view, the evidence shows that Rosseau wanted to close the  
transaction.  
[171]  
In my view, the law did not require Rosseau to tender to demonstrate that it was ready,  
willing, and able to close the APS on September 19, 2017. This is set out in Pompeani and  
Silverberg. The Court of Appeal’s decision in Di Millo outlines the law governing the  
repudiation of a contract and how an innocent party may demonstrate that it was ready, willing,  
and able to close at paras. 43 - 63:  
[43]  
The application judge also refused to accept the appellant’s statement that  
he was ready, willing and able to close. He found that it was nothing more than a  
“bald statement”, noting that there was “no evidence he had such funds”. He also  
commented on the appellant’s failure to prepare any closing documents.  
[44]  
The appellant argues that the application judge erred in law by finding  
that he was required to tender where it was clear that tender of the purchase price  
would be futile. He also says he was, in fact, ready, willing and able to close.  
[45]  
For a party to be entitled to specific performance, the party must show he  
or she is ready, willing and able to close: Time Development Group Inc. (In trust)  
v. Bitton, 2018 ONSC 4384, at para. 53; see also Norfolk v. Aikens (1989), 1989  
CanLII 245 (BC CA), 41 B.C.L.R. (2d) 145 (C.A.). While tender is the best  
Page 52  
evidence that a party is ready, willing and able to close, tender is not required  
from an innocent party enforcing his or her contractual rights when the other party  
has clearly repudiated the agreement or has made it clear that they have no  
intention of closing the deal: McCallum v. Zivojinovic (1977), 1977 CanLII 1151  
(ON CA), 16 O.R. (2d) 721 at p. 723 (C.A.); see also Dacon Const. Ltd. v.  
Karkoulis, 1964 CanLII 252 (ON SC), [1964] 2 O.R. 139 (Ont. H.C.).  
[46]  
In McCallum, at p. 723, this court explained that the renunciation of a  
contract may be express or implied:  
The renunciation of a contract may be express or implied. A party  
to a contract may state before the time for performance that he will  
not, or cannot, perform his obligations. This is tantamount to an  
express renunciation. On the other hand a renunciation will be  
implied if the conduct of a party is such as to lead a reasonable  
person to the conclusion that he will not perform, or will not be  
able to perform, when the time for performance arises.  
[47]  
The purchaser in McCallum made it clear that he did not intend to  
complete the transaction on the closing date and this renunciation relieved the  
vendors from the obligation to tender.  
[48]  
The principles around the requirement to tender are summarized  
succinctly by Perell J. in Time Development Group, at paras. 56-57:  
Tender … is not a prerequisite to the innocent party enforcing his  
or her contractual rights. Tender is not required from an innocent  
party when the other party has clearly repudiated the agreement.  
Numerous cases have held that the law does not require what  
would be a meaningless or futile gesture. Moreover, when there is  
an anticipatory breach, the innocent party need not wait to the date  
for performance before commencing proceedings for damages or  
in the alternative for specific performance of the agreement.  
[Citations omitted.]  
[49]  
Thus, when a party by words or conduct communicates a decision not to  
proceed to closing, the other party is released from any obligation to tender in  
order to prove he was ready, willing and able to close: see Kirby v. Cameron,  
1961 CanLII 203 (ON CA), [1961] O.R. 757 (C.A.); Kloepfer Wholesale  
Hardware v. Roy, 1952 CanLII 8 (SCC), [1952] 2 S.C.R. 465.  
[50]  
In my view, the appellant was relieved of the obligation to tender when  
the respondent clearly communicated a decision not to proceed with the  
transaction. On October 6, 2016, the appellant’s lawyer requested confirmation  
that the respondent would close failing which he would begin an action. The  
respondent’s reply was an invitation to commence the action. Further, in violation  
of the agreement, the respondent tried to resell the property without notice to or  
the consent of the appellant. Viewed reasonably and objectively, it was clear that  
the respondent was not going to close.  
Page 53  
[51]  
In taking issue with the appellant’s failure to tender, the respondent relies  
on Pierce v. Empey, 1939 CanLII 1 (SCC), [1939] S.C.R. 247, for the proposition  
that all terms of the option as to time must be strictly observed. In particular, the  
respondent refers to the following passage at p. 252:  
It is well settled that a plaintiff invoking the aid of the court for the  
enforcement of an option for the sale of land must show that the  
terms of the option as to time and otherwise have been strictly  
observed. The owner incurs no obligation to sell unless the  
conditions precedent are fulfilled or, as the result of his conduct,  
the holder of the option is on some equitable ground relieved from  
the strict fulfilment of them. [Citations omitted.]  
[52]  
The respondent says that Pierce v. Empey is still good law and that it  
should be applied in this case, where the appellant failed to take steps to close  
within the stipulated timeline.  
[53]  
I agree that Pierce v. Empey is good law but note that it did not involve  
anticipatory repudiation and does not speak to a situation like the one before this  
court, where the respondent clearly communicated a decision not to proceed with  
the transaction.  
[54]  
Thus, I am satisfied that the appellant was not required to tender, although  
he was required to demonstrate he was ready, willing and able to close to be  
entitled to specific performance.  
[55]  
The application judge was not satisfied that the appellant was ready,  
willing and able to close. On that point, he said there was “no evidence” he had  
the funds to close. On my review of the record, he was incorrect.  
[56]  
As the application judge noted, the appellant made the following  
statement in his affidavit: “I have always been ready, willing and able to pay the  
amount required to be paid under the option agreement.” This evidence is  
supported by two other pieces of evidence in the record.  
[57] Counsel for the respondent asked the appellant on cross-examination:  
Q.  
Paragraph 13. The first sentence – this is your Affidavit. “I  
have always been ready, willing and able to pay the amount  
required to be paid under the option agreement.” … It says in the  
Affidavit, 294,000. You don’t really have a specific recollection of  
that amount; am I correct?  
[58]  
Shortly after, the appellant’s counsel, Mr. Conte, and the respondent’s  
counsel had the following exchange:  
A.  
[I]f your question is, did he have that amount in the bank?  
He did.  
Q.  
At what point did he have it in the bank?  
Page 54  
A.  
For a long time. He’s had a lot of money in the bank for a  
long time. As you know, he took over the second – the first  
mortgage now – or the second mortgage now and he’s paid 500 …  
And he paid that from his savings.  
[59]  
The fact the appellant purchased one of the mortgages for $500,000 was  
supported by the appellant’s June 26, 2017 supplementary affidavit. As noted  
above, the application judge overlooked the existence of the supplementary  
affidavit.  
[60]  
The fact that the appellant had the $500,000 he used to purchase the  
mortgage in his savings “for a long time” is supported by Mr. Conte’s evidence  
on behalf of his client.  
[61]  
While it would have been preferable if the appellant had personally  
answered the question, in light of the rules on examinations, the answer of  
counsel is deemed to be the answer of the appellant. Rule 31.08 provides:  
Questions on an oral examination for discovery shall be answered  
by the person being examined but, where there is no objection, the  
question may be answered by his or her lawyer and the answer  
shall be deemed to be the answer of the person being examined  
unless, before the conclusion of the examination, the person  
repudiates, contradicts or qualifies the answer.  
[62]  
There was no objection to Mr. Conte answering for the appellant and the  
appellant did not repudiate, contradict or qualify the answer. No further questions  
on the issue were put to him. The answer is deemed to be the appellant’s answer.  
[63]  
In short, the application judge erred in finding that there was “no  
evidence” the appellant had the necessary funds to close. I am satisfied that the  
appellant was ready, willing and able to close. As to his failure to tender any  
documents, I have already explained why in the circumstances of this case it was  
unnecessary for the appellant to undertake the futile step of preparing any  
documents.  
[172]  
252 relies on Domicile to argue that Rosseau was not ready willing and able to close the  
transaction.  
[173]  
Domicile holds that an innocent party who rejects the repudiation of a breach must be  
ready, willing, and able to close. However, when a vendor breaches an agreement of purchase  
and sale, an innocent purchaser is not required to tender to show it was ready, willing, and able  
to close. I accept Rosseau’s submissions that since Domicile, it is “settled law” that a repudiating  
party cannot insist time was of the essence when they themselves were not ready, willing, and  
able to close or caused the delay (see Silverberg at para. 104).  
Page 55  
[174]  
Further, I agree that the facts in Domicile are distinguishable. In that case the builder  
rejected the purchaser’