CITATION: Correct Building Corporation v. Lehman, 2022 ONSC 527  
COURT FILE NO.: CV-13-00005678-00; & CV-11-00000384-00  
DATE: 2022 01 25  
ONTARIO  
SUPERIOR COURT OF JUSTICE  
B E T W E E N:  
) Court File No.: CV-13-00005678-00  
)
CORRECT BUILDING  
CORPORATION and CORRECT  
GROUP INC.  
) R. Colautti and A. Landry, for the  
) Plaintiff, Correct Group Inc.  
)
)
Plaintiffs )  
)
- and -  
)
)
JEFFREY LEHMAN, JON  
BABULIC, RICHARD FORWARD,  
JANET FOSTER, CHARLES  
) A. Formosa and F. Bogach for Jeffrey  
) Lehman, Jon Babulic, Richard  
) Forward, Janet Foster, Charles  
MAGWOOD, EDWARD ARCHER, ) Magwood, Edward Archer, Deborah  
INGRID PETERS, DEBORAH  
MCKINNON, JENNIFER  
) McKinnon, Jennifer Robinson, Alex  
) Nuttal, Jerry Moore, Michael Prowse  
ROBINSON, METROLINX,  
) and the Corporation of the City of  
ROBERT STEWART, INDICOM  
APPRAISAL ASSOCIATES LTD.,  
ALEX NUTTALL, JERRY MOORE, )  
) Barrie;  
)
MICHAEL PROWSER and THE  
)
CORPORATION OF THE CITY OF )  
BARRIE  
)
)
)
)
)
)
)
)
)
)
)
)
)
AND BETWEEN:  
) Court File No.: CV-11-00000384-00  
)
CORRECT GROUP INC.  
) R. Colautti and A. Landry, for the  
) Plaintiff.  
)
Plaintiff )  
)
)
)
- and -  
THE CORPORATION OF THE ) A. Formosa and F. Bogach, for the  
CITY OF BARRIE  
) Defendant.  
)
Defendant )  
)
) HEARD: November 29, 2021 to  
) December 3, 2021.  
REASON FOR JUDGMENT  
RSJ Ricchetti.  
REASONS FOR JUDGMENT  
THE PARTIES BEFORE THE COURT................................................................. 6  
THE PERSONAE .................................................................................................. 6  
The Plaintiffs...................................................................................................... 6  
The Defendants ................................................................................................. 6  
THE MATTERS BEFORE THE COURT ............................................................... 8  
OVERVIEW ........................................................................................................... 9  
THE ISSUES....................................................................................................... 13  
FACTS AND DISCUSSION................................................................................. 16  
a) The Purchase Price …………………………………………………………27  
b) The Schedule ………………………………………………………………..28  
ANALYSIS RE: BARRIE’s SUMMARY JUDGMENT MOTION........................... 50  
Are these motions appropriate for Summary Judgment?................................ 51  
Was the Preliminary Agreement a valid and enforceable agreement? ........... 59  
Issue Estoppel.............................................................................................. 60  
Must not be an Agreement to Agree/Negotiate............................................ 61  
Must include ALL Essential Terms............................................................... 62  
Must be a Mutual Intention to be Bound ...................................................... 64  
The Indicom Appraisal.............................................................................. 67  
The GO Station......................................................................................... 68  
Implied Term to Negotiate and Complete Preliminary Agreement (paras. 141-  
146 of the Fresh as Amended Statement of Claim) ........................................ 69  
Breach of a Duty to Disclose (para. 143 (g) of the Fresh as Amended Statement  
of Claim) .......................................................................................................... 72  
A Common Law Duty or Obligation to Disclose during Negotiations?......... 73  
Alternate Basis Relied on for a Duty or Obligation to Disclose.................... 76  
i) Bhasin v. Hrynew............................................................................... 76  
ii) Barrie’s Procurement By-Law ........................................................... 79  
iii) Enhanced duty on the Municipal Defendants?................................. 82  
iv) Latent/Patent Defect ........................................................................ 83  
v) Record of Site Condition (RSC)..................................................... 84  
vi) Did the Preliminary Agreement nevertheless create a duty of good  
faith? ..................................................................................................... 86  
Did the Preliminary Agreement Expire When YMCA Terminated its  
Involvement?................................................................................................ 88  
Nevertheless, Barrie did Negotiate in Good Faith........................................ 90  
Conclusion ................................................................................................... 92  
Comments on the Evidence Relied on by CGI to establish a duty........... 92  
Stephen Bauld (Procurement Expert)................................................... 93  
James Strasman (Purchasing Consultant) ........................................... 95  
Dave Aspen (Former Mayor) ................................................................ 96  
Riyaz Punjani (Environmental Engineer) .............................................. 98  
No Reliance on the Environmental/Archeological State of the Allandale Lands  
..................................................................................................................... 99  
Misrepresentation (paras. 147 -159 of the Fresh as Amended Statement of  
Claim) ............................................................................................................ 101  
Development or Shovel Ready .................................................................. 102  
Purchase Price........................................................................................... 104  
Silence ....................................................................................................... 105  
Fraudulent.................................................................................................. 106  
Breach of Confidentiality Agreement (paras. 121 – 123 of the Fresh as Amended  
Statement of Claim)....................................................................................... 106  
Breach of Fiduciary Duty (paras. 133- 140 of the Fresh as Amended Statement  
of Claim) ........................................................................................................ 108  
Slander and Damage to Reputation (paras. 71 – 79 of the Fresh as Amended  
Statement of Claim)....................................................................................... 109  
Unjust Enrichment (paras. 160 – 169)........................................................... 109  
Limitations Act Defence................................................................................. 110  
i) Date Barrie advised that the Preliminary Agreement was not binding.... 110  
ii) Date Barrie Provided the Historical Reports to YMCA/CGI.................... 111  
Conclusion on Barrie’s Summary Judgment Motion...................................... 112  
ANALYSIS RE: CLAIMS AGAINST THE INDIVIDUAL DEFENDANTS............ 112  
The CGI Claims ............................................................................................. 113  
Immunity under the Municipal Act.................................................................. 114  
Failure to Disclose Information to Council ..................................................... 118  
Failure to recommend CGI’s proposals to Council ........................................ 119  
Significance of the Dismissal of CGI’s Claim against Barrie ......................... 119  
Latent and Patent Defect............................................................................... 121  
Breach of Confidentiality Agreement ............................................................. 121  
Negligent Misrepresentation.......................................................................... 122  
Bad Faith in the Context of Municipal Defendants ........................................ 123  
Breach of Duty of Good Faith ........................................................................ 124  
Public Misfeasance........................................................................................ 124  
Breach of a Common Law Procurement Duty............................................... 125  
Fraud and Fraudulent Misrepresentation ...................................................... 126  
Conspiracy to Injure the Plaintiff.................................................................... 127  
Inducing Breach of Contract .......................................................................... 128  
Slander and Damage to Reputation .............................................................. 129  
The Limitation Act.......................................................................................... 129  
Conclusions on Individual Defendants’ Summary Judgment Motion ............ 130  
COSTS.............................................................................................................. 130  
THE PARTIES BEFORE THE COURT  
[1] The claim by the Correct Building Corporation (“CBC”) was previously  
dismissed by this court.  
[2]  
The Claim against Metrolinks (“Metrolinx”) has been dismissed or  
discontinued.  
THE PERSONAE  
The Plaintiffs  
[3]  
Mr. Allen Furbacher (“Furbacher”) is the principal of the Correct Group of  
Companies (“CGC”), an experienced landowner and developer. Correct Group Inc.  
(“CGI”) is a related company to CGC and was incorporated on March 11, 2009, by  
Furbacher, as a vehicle for the potential development of the Allandale Lands.  
The Defendants  
[4]  
The Corporation of the City of Barrie (“Barrie”) is the owner of the Allandale  
Lands. Although some of the Allandale Lands were registered to Allandale  
Community Development Corporation (“ACDC”)’s name, no one raised any  
distinction between Barrie and ACDC, simply referring to the “City”. Accordingly, I  
make no distinction between these two entities.  
       
[5]  
The Individual Defendants are:  
(a) Jeffrey Lehman (“Lehman”) – Barrie’s current Chief Executive Officer and  
Mayor, and, at times, a Barrie Councillor;  
(b) Richard Forward (“Forward”) – Barrie’s General Manger of Infrastructure,  
Development and Culture from 2008 to 2012;  
(c) Jon Babulic (“Babulic”) – Barrie’s Chief Administrative Officer from March  
2007 to January 2012;  
(d) Janet Foster (“Foster”) – Barrie’s City Centre Revitalization Coordinator  
and, at some material times, Barrie’s Senior Development Planner;  
(e) Charles Magwood (“Magwood”) – employed by C.J. Magwood Holdings  
Limited, the corporation retained by Barrie as a City Centre Facilitator or  
Downtown Development Facilitator until September 30, 2009;  
(f) Edward Archer (“Archer”) – Barrie’s General Manager of Corporate  
Services from 2007 to February 2014;  
(g) Deborah McKinnon (“McKinnon”) – Barrie’s Director of Finance from  
September 2008 to in or around March 2015;  
(h) Jennifer Dennison (nee Robinson) (“Dennison”) – Barrie Councillor from  
December 2010 to August 2012;  
(i) Alex Nuttall (“Nuttall”) – Barrie Councillor from 2006 to 2014;  
(j) Jerry Moore (“Moore”) – Barrie Councillor from December 2003 to  
November 2010;  
(k) Michael Prowse (“Prowse”) – Barrie Councillor from 2003 to July 2017;8  
and  
(l) Ingrid Peters (“Peters”) – Barrie’s City Solicitor.  
(collectively the Individual Defendants)  
THE MATTERS BEFORE THE COURT  
[6]  
The Counterclaim by Barrie is to be dismissed on consent. Barrie’s counsel  
advised CGI’s counsel of this before the hearing. A copy of the correspondence  
relating to this issue was forwarded to this court on consent. CGI wishes to address  
the issue of costs of the counterclaim at the conclusion of these motions.  
[7]  
CGI’s claim against Deborah McKinnon and Jennifer Robinson is  
dismissed on consent. It is unclear whether there is an issue of costs relating to  
this dismissal.  
[8]  
Barrie and the Individual Defendants bring these summary judgment  
motions seeking a dismissal of the CGI claims in both actions.  
 
[9]  
CGI defends the summary judgment motions and brings its own motion to  
strike Barrie’s counterclaim for abuse of process alleging failure to disclose  
relevant information on a prior motion for the removal of a Certificate of Pending  
Litigation. Given the withdrawal of Barrie’s counterclaim, CGI’s motion to strike is  
no longer an issue except for costs.  
OVERVIEW  
[10]  
At the heart of most the CGI claims, although expressed as various causes  
of action, is the allegation that Barrie or the Individual Defendants should have  
disclosed environmental and archeological information to CGI about the Allandale  
Lands before, at the time of the Preliminary Agreement and afterwards.  
[11]  
At issue in these proceedings is an approximately 9-acre parcel of land  
located on the southern edge of Barrie (“Allandale Lands”). On the Allandale  
Lands is located a historical train station building (“Train Station”). Some parts of  
the Allandale Lands (near the Train Station) are designated “no build” (“Train  
Station Lands”). On the remaining parts of the Allandale Lands, with appropriate  
zoning and development conditions/agreements, those parts could be developed  
in some manner.  
[12]  
Prior to 2008, there had been several environmental and archeological  
assessments of limited parts of the Allandale Lands by previous owners. As such,  
the entire extent and degree of any potential environmental and archeological  
 
impediments to restoring the Train Station and developing the remaining Allandale  
Lands, was not entirely known.  
[13]  
In 2008, Barrie issued a Request for Expressions of Interest (“RFEI”) for  
the development of the Allandale Lands.  
[14]  
YMCA responded to the RFEI. YMCA wished to restore the Train Station  
and create a new community YMCA. However, YMCA had no plans to develop the  
rest of the Allandale Lands.  
[15]  
Eventually, YMCA advised that CGI had joined with YMCA to respond to  
the RFEI. YMCA and CGI expressed an interest to jointly develop the Allandale  
Lands.  
[16]  
[17]  
Barrie chose YMCA/CGI to negotiate with.  
In March 2009, a Memorandum of Understanding (“MOU”) was negotiated  
between Barrie and YMCA/CGI. In the MOU, certain issues such as  
“environmental” “etc.” were unresolved and were to be negotiated later.  
[18]  
On May 12, 2009, a Preliminary Agreement was signed by the YMCA/CGI  
and Barrie (“Preliminary Agreement”). The Preliminary Agreement sets out  
various other agreements the parties needed to enter into to proceed with the  
development. One key agreement to be negotiated and finalized was an  
Agreement of Purchase and Sale (“APS”) since Barrie wanted to know in advance  
and approve the Allandale Lands’ development.  
[19]  
The Preliminary Agreement was silent on various matters, including who  
would be responsible for any potential environmental/ archeological issues for the  
development of the Allandale Lands.  
[20]  
[21]  
In the summer of 2009, draft APSs were exchanged.  
There were a number of issues that arose. One of the issues in dispute that  
arose was that Barrie wanted YMCA/CGI to be responsible for any potential  
environmental/archeological issues and YMCA/CGI wanted Barrie to be  
responsible for any potential environmental/ archeological issues.  
[22]  
During the summer of 2009, there were several significant changes to the  
direction of the proposed development. One was that YMCA and CGI would no  
longer be joint developers. Each would develop their separate portions of the  
Allandale Lands.  
[23]  
In late summer of 2009, given that the parties could not agree on the  
responsibility for potential environmental/archeological issue, Barrie assembled  
and circulated to YMCA and CGI, the historical environmental and archeological  
reports (“Historical Reports”), commissioned by prior owners.  
[24]  
Negotiations continued. But, agreement on the terms of an APS could not  
be achieved.  
[25]  
In the fall of 2009, Barrie decided to commission new updated  
environmental and archeological reports for the Allandale Lands. YMCA and CGI  
were aware of Barrie’s decision to do so.  
[26]  
Negotiations continued. Still no APS could be agreed. Other issues  
remained unresolved.  
[27]  
In late 2009, Barrie decided to retain and restore the Train Station itself and  
to continue negotiations for the balance of the Allandale Lands (“Remainder  
Lands”).  
[28]  
[29]  
On January 28, 2010, YMCA withdrew from the project.  
In 2010, draft APSs continue to be exchanged between Barrie and CGI for  
the Remainder Lands. One of the many remaining issues was the responsibility  
for any potential environmental/archeological issues on the Remainder Lands.  
[30]  
Eventually, Barrie received new updated environmental/archeological  
reports confirming there were some environmental and potentially some  
archeological issues, particularly with the Train Station (now to be retained by  
Barrie as not part of the Remainder Lands).  
[31]  
CGI did not request copies of the updated environmental/archeological  
assessments. Nevertheless, CGI pursued negotiations to acquire the Remainder  
Lands for development.  
[32]  
By the end of summer 2010, the negotiations broke down between CGI  
and Barrie. The parties couldn’t agree on numerous terms of the development.  
[33]  
Barrie advised CGI it will no longer negotiate exclusively with CGI for the  
sale and development of the Remainder Lands.  
[34]  
Nevertheless, CGI continued to submit further draft APS’s until the middle  
of 2011. Each draft APS was rejected by Barrie.  
[35]  
[36]  
Barrie commenced the restoration of the Train Station.  
In July 2011, human bones were found in the crawl space of the Train  
Station. Archeological investigations commenced and have continued. The  
Allandale Lands have not been developed to date.  
THE ISSUES  
[37]  
The issues between CGI and Barrie are:  
a) Is this an appropriate case for Summary Judgment?  
b) Was the Preliminary Agreement a valid and enforceable contract?  
c) Did Barrie breach the Preliminary Agreement?  
 
d) Did Barrie breach a duty to negotiate?  
e) Did Barrie breach a duty to disclose the Historical Reports (or the  
contents therein)?  
f) Did the Preliminary Agreement create a duty of good faith?  
g) Did the Preliminary Agreement expire when YMCA terminated its  
involvement?  
h) In any event, did Barrie negotiate in good faith?  
i) Did Barrie commit actionable misrepresentation (negligent or  
fraudulent)?  
j) Did Barrie breach the Confidentiality Agreement?  
k) Did Barrie breach its fiduciary duty?  
l) Did Barrie defame CGI?  
m) Is Barrie unjustly enriched?  
n) Does the Limitations defence apply?  
The issues between CGI and the Individual Defendants are:  
a) Are CGI’s claims barred by the Municipal Act?  
[38]  
b) CGI’s claim against Magwood?  
c) Was there a duty owed by Staff to disclose environmental/archeological  
issues?  
d) What is the significance of the dismissal of CGI’s claim against Barrie?  
e) Did the Individual Defendants make a misrepresentation by failing to  
disclose a latent/patent defect?  
f) Did the four Individual Defendants breach the Confidentiality  
Agreement?  
g) Did the Individual Defendants make a negligent misrepresentation?  
h) Did the Individual Defendants act in bad faith?  
i) Did the Individual Defendants breach a duty of good faith?  
j) Did the Individual Defendants commit a public misfeasance?  
k) Did the Individual Defendants breach Barrie’s Procurement By-Law?  
l) Did the Individual Defendants make fraudulent misrepresentation?  
m) Did the Individual Defendants conspire to injure CGI?  
n) Is the claim against the Individual Defendants barred by the Limitations  
Act?  
o) Did the Individual Defendants induce a breach of contract?  
p) Did the Individual Defendants defame CGI?  
[39]  
For the purpose of these motions, I have assumed that, if a cause of action  
has merit, then CGI has suffered damages. Accordingly, the disputed affidavit of  
Mr. Wise plays no role in this court’s decision.  
FACTS AND DISCUSSION  
[40]  
The Allandale Lands were owned by Canadian National Railways (CN)  
prior to 1999. In 1996, CN retained an environmental consultant to conduct a  
Phase 1 and Phase 2 site assessments (the Phase 2 being a more detailed  
assessment). The Phase 2 summary was as follows:  
The purpose of the Phase II ESA involved carrying out a subsurface drilling and testing  
program to investigate for the presence of hydrocarbon or other foreign chemical  
compounds in the subsurface soil and groundwater as a result of a number of past land  
use practices at the two subject properties indicating possible environmental concerns.  
These land use practices included liquid petroleum storage and handling, the placement  
of fill, the loading/unloading of rail freight, and light automobile use. In addition, past and  
present land uses immediately adjacent to the subject lands also required further  
investigation, including an automobile repair business, a rail freight yard, liquid petroleum  
storage, the former location of “Transport Depot” immediately to the east of the lawn  
bowling club, and the sue of underground and above-ground storage tanks to the west of  
the Allandale Station grounds.  
…
 
Based on the above results, it appears that past land use practices had an impact on the  
soil and groundwater in one location adjacent to the western boundary of PIN 42220.  
However, visual observations, field screening tests and chemical testing results indicate  
that the sampled soil and groundwater at the remaining testing locations ahs not been  
adversely impacted by past or present land use practices at the sites. TECL recommends  
that the area indicating strong magnetic anomalies be further investigated with a  
backhoe to determine whether underground fuel storage tanks are buried at this location.  
TECL also recommends the use of further subsurface drilling in the area of Borehole 95-  
6 so that the lateral extend of diesel-impacted soils can be delineated.  
[41]  
In 1996, the Ministry of Citizenship, Culture and Recreation advised Barrie  
that:  
This office has recently been in communication with Su Murdoch of Barrie. Her recent  
research has located a credible reference to the Allandale Station as an Indian burial  
place. Based on this reference, and the low level of subsurface disturbance often  
associated with the construction of nineteenth century railroad stations, this Ministry  
recommends a program of monitoring by a licenced archaeological consultant of any  
subsurface disturbances associated with the redevelopment of this site.  
[42]  
In 1999, Barrie, through Allandale Community Development Corporation  
(“ACDC”), acquired the Allandale Lands from CN.  
[43]  
In 2000, Barrie sold the Train Station and a substantial portion of the  
Allandale Lands to CHUM Ltd. (“CHUM”). CHUM planned to restore the historical  
Train Station buildings and develop the lands as a broadcast center.  
[44]  
In 2001, CHUM retained a consultant to perform a Stage 3 and State 4  
archaeological assessment of the Allandale Lands. Phase 1 and 2 had been  
previously done. The Recommendations included the following:  
We concur with the recommendation that there are no further concerns for the area of  
the Allendale …archaeological site that has been excavated as shown in Figure 6.1.  
We concur with the recommendation to proceed with fill removal on the subject property  
in conjunction with monitoring by the archaeological consultant.  
…
The need for monitoring remains because there is a possibility, although remote, that the  
Ossuary remains could be encountered on the property.  
[45]  
In 2000, CHUM retained a consultant, Geotech, to perform a geotechnical  
and environmental investigation. In the consultant’s report dated December 15,  
2000 reported:  
Based on the chemical analysis completed, it is our considered opinion that the  
soil and groundwater, as represented by the samples analyzed, does not present  
an environmental concern or affect the current use of the property or neighboring  
properties under the current MOEE soil remediation criteria.  
[46]  
The CN and CHUM reports referred to above are hereafter referred to as  
the “Historical Reports”.  
[47]  
CHUM’s management changed. CHUM decided not to proceed with its  
development plans.  
[48]  
CHUM sold the Lands back to Barrie in June 2006. Barrie was provided  
access to and use of the Historical Reports when it reacquired the lands from  
CHUM.  
[49]  
The Historical Reports do NOT state that the Allandale Lands are not  
developable. The Historical Reports do reference that, only some of the Allandale  
Lands had been investigated. Further, the Historical Reports do suggest that  
further assessments need to be done or, monitoring by an archeologist when  
excavating.  
[50]  
On February 29, 2008, Barrie issued a Request for Expression of Interest  
(RFEI) for the development of the Allandale Lands.  
[51]  
The RFEI’s key elements of the proposed development were described as:  
a) Restoration of the Train Station and the surrounding train station lands  
(Train Station);  
b) Incorporation of a GO Station platform and parking;  
c) The development proposal for the Allandale Lands was to comply with  
various Barrie by-laws/plan and Barrie’s Official Plan; and  
d) A “Development Plan” needed to be agreed upon such as a draft  
Development Concept Plan included in the RFEI.  
[52]  
The RFEI specifically, stated that “any disposal of City property will be  
subject to compliance with the City’s Surplus Land By-Law 95-104 as amended by  
By-Law 2004-107 including notice and appraisals,” (para 7.1). This by-law requires  
that Barrie obtain an appraisal prior to the sale of any city owned lands.  
[53]  
The RFEI did NOT include any reference to any potential environmental or  
archeological issues or refer/include copies of the Historical Reports. It was silent  
on these issues.  
[54]  
Several responses to the RFEI were received.  
[55]  
YMCA submitted a response to the RFEI. YMCA proposed to build a new  
YMCA facility and restore the Train Station buildings for a public use. However,  
YMCA’s concept would only utilize a portion of the Allandale Lands.  
[56]  
Barrie was aware that YMCA "expected” it to deliver an environmentally  
clean site.  
[57]  
Subsequently, YMCA advised Barrie that its development partner would be  
CGC.  
[58]  
On November 3, 2008, Barrie Staff prepared a report comparing the RFEI  
responses. The report stated “The Lands have been substantially cleaned of  
contaminated soils, archeological and geotechnical assessments have been  
initiated and Go Transit has completed its rail and transfer station work. As a result  
of the substantial works undertaken by the City and others on the Lands over the  
past few years, the Lands are largely “development ready”. The report repeated  
that any sale of the Lands would require compliance with the City’s Surplus Land  
By-Law.  
[59]  
In late 2008 or early 2009, CGC, through its principal, Furbacher became  
involved with YMCA, as joint developers. YMCA and CGC, a consortium  
(“YMCA/CGI”), responded to the RFEI and expressed an interest in developing the  
entire Allandale Lands.  
[60]  
Furbacher testified he didn’t see the RFEI and never asked about potential  
environmental/archeological issues regarding the Allandale Lands at the time he  
became involved in this development. If CGI didn’t see the REFI and didn’t ask  
about potential environmental/archeological issues, then his fundamental  
allegation that he believed he would get a “clean” site or a “development ready”  
site by the time he signed the Preliminary Agreement makes no sense at all  
especially from an experience land developer who is aware that environmental and  
archeological issues are associated with the development of land. This known  
awareness would have even been even more acute when seeking to develop  
abandoned railway lands. And if that wasn’t enough, CGI’s term sheet from its own  
bank required that the Lands have a Phase 1 report with no environmental issues.  
So, CGI’s reliance on “silence” by Barrie to proceed with the development makes  
no sense at all. Furbacher never even asked for a Phase 1 report from Barrie!  
[61]  
The response to the RFEI submitted jointly by the YMCA/CGI provided that  
YMCA/CGI would, among other things:  
(a) Restore the Train Station building and make them available for public  
use;  
(b) Build the GO Transit platform and a pedestrian crossing;  
(c) Complete a 150,000 square foot mixed-use development of  
condos/hotel, commercial and retail space;  
(d) Retain a consultant to develop a creative Allandale plan to act as a  
guide to the arts, culture, and heritage programming for Allandale  
village, including a possible Children’s Museum; and  
(e) Work with community partners to enrich the public opportunities for the  
Train Station Lands.  
[62]  
On March 2, 2009, YMCA/CGI and Barrie negotiated a Memorandum of  
Understanding (“MOU”). One draft of the MOU stated that the Geotech report  
(CHUM’s geotechnical and environmental consultant) had been provided to CGI.  
When asked under oath, Furbacher “couldn’t recall” whether he received those  
reports during negotiations of the MOU. However, there is no dispute, and  
Furbacher acknowledged, that the Geotech environmental report had come up  
during the discussions leading up to the Preliminary Agreement.  
[63]  
The MOU provided:  
The consortium of the YMCA and CGC (the Correct Group of Companies) has been  
selected to continue to negotiate with the City based on its response to the RFEI.  
The following sets out the terms that the parties agree will form the basis of future  
agreements with respect to the development of the station lands. It is contemplated that  
following acceptance of this Memorandum of Understanding (MOU) by City Council that  
the parties (the City and YMCA/CGC) will proceed expeditiously to complete legal  
agreements that may include:  
A Purchase Agreement for all or a portion of the station lands  
A Development Agreement that will describe how the lands will be developed,  
project specifics, timing and financial obligations  
A Site Plan Agreement  
Train Station Agency agreement with the YMCA  
Other Agreements to cover any legal preconditions, joint operations issues,  
environmental issues, transportation issues etc.  
(Emphasis added).  
[64]  
On April 6, 2009, Barrie Council authorized the Mayor and City Clerk to  
enter into a Preliminary Agreement with YMCA/CGI.  
[65]  
At that April 6, 2009 Council meeting, Elaine Crossland, a member of the  
public, asked whether the Allandale Lands were a “Brownfield Site” and inquired  
whether Barrie had commissioned environmental reports. It is important to note  
William Moore of Solutions Inc. (“Moore”), the YMCA strategy consultant (although  
CGI submits that Mr. Moore was not CGI’s consultant, just YMCA’s consultant  
despite the fact CGI and YMCA were joint developers on this project and is  
inconsistent with Furbacher’s emails confirming that McKnight was working for him  
on this project) and Michael McKnight of McKnight of McKnight Charron Lauron  
Inc. Architects (“McKnight”). Both the YMCA/CGI’s architect and consultant were  
present at that Council meeting.  
[66]  
In Ontario, Brownfield properties are generally described as vacant or  
underutilized places where past industrial or commercial activities may have left  
environmental contamination behind. Brownfield sites can be developed but must  
first meet the requirements of Ontario’s Environmental Protection Act.  
[67]  
Barrie’s staff, Forward, in response to Ms. Crossland’s comments at the  
Council meeting, emailed William Moore and McKnight for an update on the  
environmental issue. McKnight responded and advised he had formerly worked  
on those lands, was in touch with an engineering firm to obtain reports prepared  
for past owners of the Allandale Lands and advised that an archeological  
investigation had been carried out.  
[68]  
The issue of potential environmental/archeological issues was, now,  
clearly known to YMCA/CGI through its consultants.  
[69]  
A Preliminary Agreement continued to be negotiated between YMCA/CGI  
and Barrie.  
[70]  
On May 11, 2009, the Barrie Council passed a resolution that the  
$2,000,000 price was to be subject to Council accepting the terms of an APS with  
an appraisal in accordance with its Surplus Land by-law (as described in the RFEI).  
[71]  
On May 12, 2009, the Preliminary Agreement between Barrie, the  
YMCA/CGI was signed.  
[72]  
The Preliminary Agreement provides that Barrie and YMCA/CGI would  
negotiate and enter into a number of agreements, including:  
(a) An agreement of purchase and sale between Barrie, the YMCA/CGI);  
(b) A “Site Plan/Development Agreement”;  
(c) A restoration agreement between Barrie and the YMCA for the first  
stage of the restoration work to be completed on the Train Station;  
(d) A “Completion Plan” to define the work to be done by the YMCA to  
restore the Train Station after the transfer of the Station Lands  
(paragraph 2.3) (the “Completion Plan”). If the second stage of the  
restoration process did not proceed substantially in accordance with the  
Completion Plan, Barrie would have the right to have the Train Station  
Lands re-conveyed to it;  
(e) A cost formula with respect to the construction of the east/west road  
within the Allandale Lands;  
(f) The design of the north/south road to accommodate the integration  
traffic circulation needs of the development;  
(g) A Completion Plan Agreement; and  
(h) A first right of refusal for Barrie to reacquire the Train Station Buildings.  
The Preliminary Agreement did NOT include:  
[73]  
(a) The typical terms expected in an APS including a precise legal  
description of the property (it only referred to it as “approximately 9.1  
acres of land), or a closing date or requisition date, or representations  
and warranties;  
(b) A Final Development Concept Plan; and  
(c) The further agreements described in the MOU for “Other Agreements  
to cover any legal preconditions, joint operations issues, environmental  
issues, transportation issues etc.  
[74]  
CGI points on two specific aspects of the Preliminary Agreement as  
significant to its claims:  
a) The Purchase Price  
[75]  
The Preliminary Agreement refers to a $2,000,000 purchase price. CGI  
submits there was no requirement for Council approval or an appraisal.  
Subject to Barrie City Council’s acceptance of the terms and conditions of this  
Preliminary Agreement, the City and YMCA/CGC agree to finalize an Agreement of  
Purchase and Sale (“APS”) to sell, transfer and deliver to the YMCA/CGC all of the  
City’s right, title and interest in the Station Lands for the agreed purchase price  
(“Purchase Price”) sum of $2,000,000 (Two Million Dollars) for approximately 9.1  
acres of land (includes the land currently owned by ACDC at the east end of the  
Station Lands).  
[76]  
In my view, this has no impact on the determinations on these summary  
judgment motions. At the end of the day, the parties never got into a serious  
dispute over this. Even if the Preliminary Agreement was a valid and binding  
contract, the inconsistency of the appraisal term in the RFEI and the specific price  
set out in the Preliminary Agreement was not the dispute that prevented agreement  
on an APS. That is because, amongst many other reasons, the joint development  
evaporated by the summer of 2009, no APS was ever finalized, and YMCA  
dropped out on the development.  
b)The Schedule  
[77]  
The Preliminary Agreement contains a schedule, which CGI alleges could  
not have been met if there were any environmental/archeological issues  
discovered on the Allandale Lands. CGI submits that this schedule demonstrates  
that Barrie represented that the Allandale Lands were “shovel ready” or  
“development ready”:  
The YMCA/CGC agree that they will make their best effort to adhere to the  
YMCA/CGC Draft Concept Design as contained in Schedule A and the  
YMCA/CGC Station Lands Development Schedule as contained in Schedule B,  
subject to market conditions and receiving approvals.  
[78]  
The Preliminary Agreement Schedule contemplated that the time to  
“Negotiate Agreement” and “Land Purchase” would be completed within 2 months  
and development would start within a short time thereafter. Even if the Preliminary  
Agreement was a valid and binding contract, it was clear that this schedule was  
not binding as the first draft APS were exchanged well after the two month  
“window” and continued for many more months. Further, everyone was aware of  
the potential environmental/archeological issues raised at the April 6, 2009 Council  
Meeting before the Preliminary Agreement was signed which could delay the  
development if issues were uncovered. Further, as will be seen below, the  
Historical Reports were provided to YMCA/CGI’s counsel in September 2009, but  
YMCA/CGI continued to negotiate to acquire and develop the Allandale Lands with  
immediate development plans. Lastly, it was clear from the YMCA/CGI response  
to the Barrie draft APSs and YMCA/CGI’s draft APSs that both recognized the  
potential for environmental/archeological issues which might arise, and would no  
doubt delay the development but continued to negotiate towards an uncertain  
schedule given the issues to be resolved and potential issues that might arise. To  
suggest that the schedule was an implicit enforceable term that the Allandale  
Lands were ready for immediate development has no merit.  
[79]  
One of the requirements of the Preliminary Agreement was that CGI  
make financial disclosure to demonstrate CGI had the financial wherewithal to  
complete the proposed development. On April 29, 2009, Barrie signed a  
confidentiality letter to maintain the confidentiality of CGI’s financial information.  
On May 25, 2009, four individuals, on behalf of Barrie (including Forward),  
attended a meeting with representatives of CGI to review CGI’s financial  
information. The four individuals also executed a confidentiality agreement. No  
disclosure of the financial information was disclosed by any of the four  
individuals.  
[80]  
The negotiations began.  
[81]  
George Cameron (“Cameron”) and his law firm, HGR Graham Partners  
LLP (“HGR”), were the lawyers for the YMCA/CGI for the negotiations involving  
the Allandale Lands development. They were the only lawyers involved in the  
negotiations or this development project in 2009 for YMCA/CGI and for CGI until  
prior to March 2010 CGI retained a new counsel. CGI’s counsel during these  
motions acknowledged there was no dispute that Cameron was CGI’s lawyer until  
January 2010 and that during the period was negotiating on behalf of CGI and  
YMCA.  
[82]  
In July and August 2009, YMCA/CGI produced two concept plans, both of  
which were different from the draft concept plan in the Preliminary Agreement.  
One other significant change by YMCA/CGI was that YMCA and CGI had “flipped”  
the location of their portions of the proposed project.  
[83]  
On July 28, 2009, Barrie sent to YMCA/CGI’s lawyer, Cameron, the first  
draft APS. In this draft, one of the terms provided that the responsibility for any  
potential environmental/ archeological issues was to be assumed by YMCA/CGI.  
[84]  
Barrie’s draft APS is 17 pages in length and covers matters not dealt with  
in the Preliminary Agreement. The preliminary nature of the negotiations is evident  
from the contents of Barrie’s draft APS which included:  
a) The purchaser was to provide an acceptable Master Site Plan;  
b) The purchaser and vendor were to enter into a Common Servicing  
Agreement;  
c) There were conditions relating to hazardous substances;  
d) Schedule A to the draft APS was incomplete as it contained a partial  
description of the Allandale Lands, with a caveat at the outset that states  
“TO BE CONFIRMED”;  
e) Schedule B to the draft agreement was incomplete as it contained a  
“Diagram of the Property” and contains another caveat, which reads  
“This Schedule A-1 is inserted to the Draft Agreement as an example  
only, of the general configuration of the Allandale Village Development,  
a precise configuration will accompany the Final Agreement”;  
f) Schedule “C”, being the Master Site Plan was also incomplete as it was  
blank other than the title. “Master Site Plan” is defined in the draft APS  
to mean “an interim plan which outlines, in general terms, the  
Purchaser’s intent with respect to the development of the Property; it is  
preliminary to the final Site Plan and provides initial descriptive  
information regarding the development…”;  
g) Schedule “D” was also incomplete in that it was entitled “Permitted  
Encumbrances”, and was blank other than a note to the drafter which  
reads “to be added”; and  
h) Schedule “E”, was also incomplete in that it was entitled “Train Station  
Lands and CADAMS Lands” and contained the same wording “to be  
added”.  
[85]  
Cameron advised that Barrie’s draft APS was not acceptable and  
suggested a meeting to determine whether there was a “deal to be had” between  
the parties.  
[86]  
On August 5, 2009, representatives of Barrie, YMCA/CGI and their  
counsel met to discuss the Barrie’s draft APS. During the meeting, the following  
issues were discussed:  
(a) the disclosure by YMCA and CGI that they would no longer  
be jointly developing the Allandale Lands but would be separately  
developing different portions of the Allandale Lands;  
(b) Changes to the timing of site plans and design concept plan; and  
(c)  
Unresolved issues relating to the other agreements that needed to  
be prepared under the Preliminary Agreement, including the Purchase  
Agreement, the Site Plan/Development Agreement, the Train Station  
Restoration Agreement, the Completion Plan, and the Repurchase  
Agreement.  
[87]  
During these discussions, one of Barrie’s Staff stated that the Preliminary  
Agreement was not a binding contract.  
[88]  
On August 6, 2009, Furbacher wrote to Magwood expressing his  
dissatisfaction with Barrie’s draft APS. Furbacher also refers to his displeasure  
that a Barrie staff member advised the Preliminary Agreement was not a binding  
contact.  
[89]  
On August 10, 2009, Barrie Staff advised Barrie Council that YMCA/CGI  
were continuing to negotiate the APS and other agreements for the proposed  
development.  
[90]  
On August 11, 2009, in response to his August 6, 2009th letter, Barrie wrote  
to Furbacher repeating that the Preliminary Agreement was not a binding contract.  
[91]  
On August 24, 2009, YMCA/CGI submitted a revised draft APS. This  
YMCA/CGI draft APS, in addition to site and development issues, included a  
provision that Barrie was to represent and warrant:  
a) There were no contaminants or significant archeological issues on or  
under the Allandale Lands;  
b) Barrie would indemnity and hold harmless YMCA/CGI from any liability  
or obligations arising therefrom; and  
c) Barrie to represent, warrant and covenant that there were no issues that  
would adversely affect the development of the Allandale Lands.  
[92]  
The other significant changes in YMCA/CGI’s draft APS were:  
a) Confirmation that YMCA and CGI would not be jointly developing the  
Allandale Lands but would be co-venturers on the proposed  
development;  
b) YMCA nor CGI would be required to provide construction contracts or  
drawings at the closing of the APS. This was a concern to Barrie since  
there was no guarantee to Barrie that the development of the Allandale  
Lands would be an integrated development; and  
c) The Train Station lands were to be zoned for development on closing of  
the APS. The Preliminary Agreement only provided that Barrie would  
cooperate to make zoning available.  
[93]  
The impasse and proposed changes by YMCA/CGI resulted in a further  
meeting on August 27, 2009, between representatives of YMCA/CGI, Barrie and  
counsel. The YMCA/CGI’s counsel, Cameron was also at this meeting.  
Discussions at this meeting included:  
a) that because YMCA and CGI would not be jointly developing the  
Allandale Lands, Barrie would require YMCA and CGI to provide a  
"Master Site Plan" to ensure the separate development parts worked  
seamlessly together, which Master plan would be subject to Barrie  
Council’s approval; and  
b) Barrie agreeing to assemble all the Historical Reports and forward them  
with YMCA and CGI.  
[94]  
Furbacher says he has “no recollection of attending” this meeting. Forward  
from Barrie, says Furbacher was present at the meeting. There are no notes  
confirming whether Furbacher was at the meeting. Given that Cameron, the  
lawyer negotiating the APS for YMCA and CGI and others representing YMCA/CGI  
was present is sufficient to impart knowledge of the discussion on  
environmental/archeological issues and that the Historical Reports would be  
assembled and forwarded. Cameron had clearly been negotiating on behalf of  
YMCA/CGI. CGI did not have another counsel, other than Cameron, representing  
it until early 2010. It makes no sense that with environmental/archeological  
issues, one of the identified areas in dispute, would not have been made known to  
Furbacher by Cameron, YMCA or his consultants.  
Nevertheless, whether  
Furbacher was at this meeting is immaterial to the outcome on these motions.  
[95]  
On September 2, 2009, Barrie sent to Cameron the Historical Reports.  
Cameron sent them to YMCA. YMCA acknowledged receipt. Cameron says he  
sent them to Furbacher in mid September. Cameron produced a delivery receipt  
to Furbacher. But it wasn’t signed by a recipient or Furbacher. Furbacher denies  
receiving the Historical Reports.  
[96]  
Cameron’s account to YMCA/CGI on September 30, 2009 expressly states  
that Cameron reviewed the archeological and environmental reports – the  
Historical Reports forwarded by Barrie. Furbacher states he never asked for the  
Historical Reports reviewed by Cameron.  
[97]  
Furbacher attempts to distance himself even further from the meeting and  
receipt of the Historical Reports by stating that Cameron was YMCA’s lawyer  
despite the fact that Cameron was negotiating for YMCA and CGI as joint  
developers, Cameron’s invoices were addressed to YMCA and CGI and CGI had  
no other lawyer acting on its behalf with respect to this development during this  
period of time.  
[98]  
In my view, Furbacher’s denial of having received the Historical Reports,  
makes no difference - Furbacher's lawyer on this transaction, Cameron, received  
the Historical Reports and that is sufficient evidence of Barrie’s disclosure of the  
Historical Reports to YMCA and CGI. Accordingly, CGI had knowledge of and  
possession of the Historical Reports.  
[99]  
To be clear, given that I find the Preliminary Agreement was not a valid and  
enforceable agreement and there is no duty to disclose the Historical Reports  
during negotiations, even if I had accepted Furbacher's alleged lack of knowledge  
or receipt of the Historical Reports, it would not have changed the outcome on  
these motions. However, if it was necessary to use the court’s additional powers  
under Rule 20.04(2.1), I would have rejected Furbacher’s evidence on this issue.  
Having read Furbacher’s affidavit and cross-examination on this issue, if  
necessary, I would have made a credibility finding – Furbacher’s evidence is an  
obvious attempt to avoid knowledge of what he knows is fatal to his claims - that  
he couldn’t recall receiving the Geotech reports; he couldn’t recall whether he  
attending the meeting where the environmental/archeological issues were  
discussed; didn’t receive the Historical Reports from Cameron AND Frubacher  
says he never knew or saw the Historical Reports until the Affidavit of Documents  
in this proceeding.  
[100]  
Now, YMCA, CGI and Barrie had the same environmental and  
archeological information regarding the Allandale Lands that existed – the  
Historical Reports.  
[101]  
YMCA/CGI continued to negotiate to acquire and develop the  
Allandale Lands. On September 18, 2009, Furbacher sent an email to Barrie's  
representatives and YMCA. In it, Furbacher, inter alia, advises as follows:  
Notwithstanding that we recently spent considerable time and money to complete an  
APS by George Cameron we were (contrary to our agreement from our earlier City  
meeting) presented with an APS by City staff. We shelved our APS (as we were told to  
do so) and tried working with the City staff APS which George attempted to modify.  
The new and contentious issues were new conditions that would not allow the project to  
proceed. Staff introduced these additional terms after our preliminary agreement was  
signed.  
We have had follow up meetings and George Cameron has been attempting to drive the  
process forward on our behalf.  
We ask you and staff to please consider the importance of these issues to us. We need  
to have the framework in an Agreement that will allow us to complete it considering the  
nature of the project and the economic times we face.  
We are doing our best to cooperate and be reasonable, but we do require sufficient time  
to be able to get the Allandale project on track, started and completed after we close.  
We must be mindful of economic times and the fact that any underground parking will  
form the structure and foundations for the buildings above. There is a lot of work to do.  
We need city approvals and before that completion of drawings which require a huge  
input and expense.  
Please consider we need a time frame that works for us so that we can successfully build  
out the project. We cannot consider buyback options that will prevent us from being able  
to finance this project or that will put our company at huge unnecessary risk.  
(Emphasis added).  
[102]  
CGI points to an email of Magwood during this period that  
expressed Magwood’s personal view that, “in the end”, Barrie would be  
responsible for delivering a clean site. In my view, this is irrelevant. At the time,  
Magwood was leaving his role as Barrie's facilitator on this project. Magwood had  
no authority to bind Barrie; He was not a Councillor; He was not an employee/staff.  
His personal view as to what the outcome of the negotiations between Barrie and  
YMCA/CGI would or might be is irrelevant.  
[103]  
Negotiations continued. Some of these negotiations were  
accurately summarized in a Barrie Staff Report of September 28, 2009:  
... the position of the YMCA/CGI in the purchase negotiations was that it was prepared  
to commit to a construction start within a negotiated time frame following settlement of a  
Site plan/Development Agreement/building permit and further to use commercial best  
efforts to complete construction within a negotiated timeframe subject to market  
conditions.  
In addition, CGI was prepared to acknowledge the expectation that the complex would  
be completed within five years of the transfer closing subject to market conditions.  
Staff recommended that the land be divided with separate ownerships between CGI and  
YMCA providing that they commit to a Master Site Plan in a form acceptable to council  
that would be more detailed than the Concept Plan; that they commit to a common  
servicing agreement; that site specific zoning bylaw be amended to allow transfer of  
separate parcels; that the two pillars of the development namely the Go platform and  
access and the restored train station can be constructed and operated as standalone  
projects independent of the YMCA/CGI construction program;  
and that a Purchase Agreement be executed by all the parties with preconditions relating  
to construction timing, Train Station Restoration Agreement, Go platform construction,  
and contemporaneous land transfers with aggregate payment of the $2 million purchase  
price, apportionment to be determined by the consortium.  
Staff further recommended that each of the YMCA/CGI should covenant to commence  
the construction works within ten months following site plan agreement registration and  
the issuance of building permits. Construction works would effectively start within 13  
months of the closing date, or in a worst case within 18 months of the date of transfer.  
Staff further recommended a repurchase agreement recourse so that if a party fails to  
submit a complete application for site plan approval within the time required, then the  
city would be allowed to repurchase the project at 90% of the apportioned transfer price.  
Staff noted that it should be noted at closing the $2 million purchase price will have been  
apportioned between the parcels.  
(Emphasis added).  
[104]  
Clearly, there were ongoing wide-ranging discussions on many  
important aspects and details regarding the development.  
[105]  
CGI points to the wording at the bottom of the Staff Report that  
states: “there are no environmental matters related to the recommendation" as  
evidence that Barrie was "hiding" the environmental and/or archeological issues  
from Council. CGI simply ignores the words “related to the recommendation”.  
This is a standard line in all Staff reports where the recommendations are not  
impacted by environmental considerations.  
The words “related to the  
recommendation” cannot be ignored.  
In this report, there were no  
recommendations that were driven or impacted by environmental matters. More  
importantly, everyone by this date had the Historical Reports and it was clear from  
the negotiations that neither party wanted to assume the potential risk of  
environmental/archeological issues.  
[106]  
On September 29, 2009, given the discussions regarding  
potential environmental/archeological risks and issues, Barrie decided that new  
up-to-date assessments needed to be commissioned to obtain more current and  
detailed information on any potential environmental/ archeological issues on the  
Allandale Lands.  
[107]  
On October 1, 2009, after Barrie’s internal Environmental  
Officer reviewed the Historical Reports and recommended that new Phase 1 and  
Phase 2 assessments be undertaken for the Allandale Lands.  
[108]  
Nevertheless, the negotiations between Barrie and YMCA/CGI  
continued. On October 9, 2009, Barrie sent the YMCA and CGI a further draft APS.  
Barrie advised it did not accept certain provisions put forward by YMCA/CGI in its  
last draft APS and listed them in a covering memorandum. One of the issues in  
dispute continued to be the assumption of liability for any potential  
environmental/archeological issues. Other issues also remained unresolved:  
timing of the transfer of the Train Station Lands, the timing of the development,  
and the timing of zoning for the development. Lastly, Barrie also advised that,  
given the change to separate YMCA and CGI as joint developers:  
a) Barrie wanted YMC and CGI to enter into a Co-Venture Agreement on  
or before closing;  
b) Barrie wanted, YMCA and CGI to enter into a Common Servicing  
Agreement on or before closing; and  
c) Barrie wanted the registration of a Master Site Plan on or before closing.  
[109]  
On December 7, 2009, Barrie Council authorized Barrie to  
continue to negotiate an APS with YMCA/CGI on the basis that Barrie would retain  
ownership of the Train Station Lands, but not the rest of the Allandale Lands  
(Remainder Lands). Council also instructed Barrie to negotiate a lease agreement  
for the operation and maintenance of the Train Station building with the YMCA.  
Nether YMCA nor CGI objected to this.  
[110]  
It is important to note that the Train Station is where the  
Historical Reports had identified as a potential burial site. This part of the Allandale  
Lands would now remain owned by Barrie, who would have to assume the costs  
of restoring and any risks of any archeological issues on the Train Station Lands.  
[111]  
On December 14, 2009, Barrie Council authorized updated  
Environmental Site Assessment Phase 1 and 2 study, an updated archaeological  
Stage 1 and 2 Assessment, surveys for the Allandale Lands. Amrick Consultants  
Limited was retained for the archeological assessments. Golder Associates was  
retained for the environmental assessments.  
[112]  
On January 28, 2010, YMCA announced that it was withdrawing  
from the Allandale Lands development.  
[113]  
As a result of YMCA’s withdrawal, many of the provisions in the  
Preliminary Agreement no longer make any sense. The joint obligations of  
YMCA/CGI were no longer applicable. Negotiations would have to proceed on a  
significantly new development arrangement with CGI for the Remainder Lands  
alone.  
[114]  
Barrie decided to proceed with the restoration of the Train  
Station Lands.  
[115]  
By January 2010, Furbacher knew that Barrie had  
commissioned updated environmental and archeological assessments for the  
Allandale Lands.  
[116]  
On the same day YMCA withdrew from the project, January 28,  
2010, and despite Furbacher admittedly knowing that Barrie had commissioned  
updated environmental and archeological investigations on the Allandale Lands,  
Furbacher advised that CGI would like to continue to negotiate for the acquisition  
and development of the Remainder Lands. All subsequent events take place when  
Furbacher admitted that he knew Barrie had commissioned additional updated  
environmental and archeological assessments and reports which were  
outstanding.  
[117]  
On the same day, January 28, 2010, Barrie publicly announced  
that it would continue to negotiate to develop the Remainder Lands with CGI (and  
issued a press release that stated):  
“The Correct Group of Companies Retail Development is proceeding which will  
result in a variety of businesses for the public to enjoy. In addition, the  
archaeological investigation is still proceeding as planned. Council will now  
determine the next steps to continue progress on this important development.”  
(Emphasis added).  
[118]  
On February 8, 2010, Barrie Council authorized staff to move  
forward with negotiations for the Remainder Lands with CGI:  
“That in light of the YMCA’s recent announcement, Staff in the Infrastructure,  
Development and Culture Division be requested to move forward with negotiations  
with the Correct Group of Companies (CGI) for the development of the Allandale  
station lands (excluding the Allandale train station building and the GO transit  
platform) and report back to general committee.”  
(Emphasis added).  
[119]  
On February 18, 2010, Golder submitted its Phase 1  
Environmental Site Assessment Report to Barrie. Golder recommended a Phase  
2 Environmental Site Assessment.  
[120]  
Negotiations between Barrie and CGI commenced for the  
Remainder Lands. On March 8, 2010, Barrie forwarded a further draft APS, this  
time to CGI's new lawyer, Stephanie Campanaro (“Campanaro”) (who replaced  
Cameron).  
[121]  
On March 10, 2010, Furbacher wrote that he wanted an  
expedited closing and start of construction, starting as early as that summer. This  
request for an immediate closing and imminent construction schedule was  
proposed despite Furbacher knowing that Barrie’s updated environmental and  
archeological assessments were ongoing and no final reports had yet been issued  
for either reports.  
[122]  
On March 16, 2010, CGI wrote to Barrie explaining how it “saw  
moving forward” with the Allandale Lands development project.  
[123]  
On March 31, 2010, Barrie responded by providing to CGI  
(Furbacher) a list of what Barrie was then doing with the Train Station Lands,  
including that it was awaiting environmental/archeological assessments for the  
Train Station Lands and the restoration of the Train Station.  
[124]  
In April 2010, Golder Associates submitted its Final Phase 2  
Environmental Site Assessment for the Allandale Lands to Barrie. Golder  
recommended a subsurface investigation.  
[125]  
On May 21, 2010, CGI’s lawyer, Campanaro, sent a revised  
draft APS to Barrie. This draft APS proposed:  
a) The purchase price for the Remainder Lands of $1,000,000;  
b) A covenant that the Remainder Lands be conveyed to CGI were free  
from hazardous substances, and that there had been no discharges,  
deposits, escapes or releases of any hazardous substances into the  
natural environment in on or under the subject lands;  
c) A covenant that the Barrie would make the necessary zoning available;  
d) CGI would limit its contribution to $400,000 to an underground  
pedestrian underpass; and  
e) CGI would enter into a cost sharing agreement.  
[126]  
A Master Site Plan was not included. Barrie requested CGI to  
produce a Master Site Plan.  
[127]  
In June 2010, CGI presented a new design concept that  
substantially expanded the commercial portion of the development (from the  
150,000 square feet previously described to a 350,000 square feet development)  
and a development which was significantly different from the draft development  
site concept approved by Barrie Council.  
[128]  
On June 15, 2010, AMICK delivered a Stage 1 Archaeological  
assessment. It concluded there were significant potential archeological issues on  
the Allandale Lands.  
[129]  
On June 21, 2010, a Barrie Staff Report recommended that  
negotiations with CGI continue and set out the parameters for such negotiations.  
On June 28, 2010, Barrie Council authorized its Staff to continue to negotiate with  
CGI. CGI was to provide a Master Site Plan.  
[130]  
On June 28, 2010, CGI wrote that there were several points  
that needed to be finalized to complete an APS including the purchase price; CGI's  
contribution to the underpass construction and other internal structures to be built  
on the Remainder Lands.  
[131]  
[132]  
Negotiations continued.  
On July 14 2010, CGI wrote to the Barrie representatives that  
they could "revert to the Preliminary Agreement" and proceed on that basis with  
respect to the commercial development aspects of the Allandale project, OR CGI  
could respond to Barrie’s newest draft APS with respect to the sale the Remainder  
Lands to CGI. Again, this new CGI proposal was put forward to Barrie, without the  
benefit of the final report from the updated environmental/archeological reports  
commissioned by Barrie. This new CGI proposal was that:  
a) The sale of the Remainder Lands to CGI for $1,126,374 in a binding  
agreement of purchase and sale to be signed by August 31, 2010, with  
a closing date of no later than September 30 2010;  
b) CGI contributing $436,209 to the construction of the underpass;  
c) CGI contributing 50% of the costs of the East/West road;  
d) CGI paying for the cost of the North/South road, less an amount  
attributable to the lands being allocated to Re/Max, with an acceptable  
undertaking from Barrie and/or Re/Max as to payment of Re/Max’s share  
of the cost of the road;  
e) CGI’s contributions above would be made up on completion of the  
construction, after expenses were reviewed and verified;  
f) Barrie would have until November 30, 2010, to have the Remainder  
Lands appraised by an independent appraiser acceptable to CGI;  
g) CGI would make a series of donations to the restoration and operation  
of the Train Station buildings equal to the difference between the net  
appraised value and the aggregate of the amounts paid by CGI to a  
maximum of $500,000, with additional terms outlined in the proposal. If  
the unit value of the appraisal, after reflecting the CGI contributions, was  
less than the current purchase package, then the purchase price of the  
remainder lands would be reduced.  
[133]  
On July 27, 2010, Golder delivered its final report. Golder  
recommended certain works be done prior to any redevelopment. Golder reported  
that an RSC might be required for any parcel of the lands to be developed for a  
more stringent use – but it didn’t say who would be responsible to obtain the RSC.  
[134]  
On August 20, 2010, Indicom delivered an Appraisal Report to  
Barrie. CGI takes issue with this appraisal as being, not objective, commissioned  
in bad faith, flawed and misleading because, it says, Indicom ignored all  
environmental and archeological issues with the Allandale Lands. CGI ignores the  
fact that Indicom’s report clearly states Indicom did not take into account any  
technical investigations including, environmental or archeological issues with the  
lands appraised. I fail to see how this appraisal can be flawed for not taking  
environmental/archeological issues when it expressly states it did not take them  
into account. CGI relies on a former councillor who stated that this was a "bogus  
appraisal" done after the fact. In any event, I am not persuaded this is at all relevant  
since no APS (and other agreements and issues) ever got resolved and reduced  
to a valid and binding agreement(s).  
[135]  
On August 30, 2010 Barrie Council rejected CGI's July 14  
proposal. Nevertheless, CGI continued to negotiate by presenting a “Transaction  
Outline” for the Remainder Lands:  
a) CGI offered to purchase 5.12 acres of the Allandale Lands on the  
following terms;  
b) $1,000,000.00 in cash;  
c) The payment of $100,000.00 or acceptable credit to CGI for 250 off-site  
parking spaces;  
d) $850,000.00 financial contribution toward the Gowan Street underpass;  
e) $180,000.00 or 50% of the east/west road;  
f) $170,000.00 or 100% of the cost of the north/south road;  
g) $1,000,000.00 to be made as a charitable donation; and  
h) The Master Site Plan be agreed to and finalized prior to November 30,  
2010, and not to differ from the last submitted site plan of August 9, 2010.  
[136]  
On November 28, 2010, Barrie Staff recommended that the  
latest CGI proposal be rejected. On November 29, 2010, the Transaction Outline,  
(as amended by a subsequent Furbacher November 22 email) was rejected by  
Barrie Council.  
[137]  
On December 6, 2010, Barrie advised that CGI that exclusive  
negotiations with CGI were at an end.  
[138]  
Two days later, CGI again submitted a revised transaction  
outline. This too was rejected by Barrie Council.  
[139]  
[140]  
The negotiations ended between Barrie and CGI.  
Barrie re-listed the Remainder Lands for sale. CGI did not make  
an offer or submit any proposal when the Remainder Lands were re-listed.  
[141]  
While Barrie was continuing with its restoration of the Train  
Station at its expense, on July 4, 2011, the restoration contractor, working at the  
site, discovered human bones in the crawl space of the Train Station. This brought  
the restoration to a halt.  
[142]  
CGI commenced this action on December 15, 2011. The main  
thrust of that proceeding was that the Preliminary Agreement was a valid and  
binding contract and that Barrie had breached the Preliminary Agreement or  
various causes of action relating to the fact that no final agreement or development  
ever took place.  
There was no claim for non-disclosure of the  
environmental/archeological claim made in that Statement of Claim. This claim  
was made later.  
[143]  
The Train Station Lands have been the subject of archeological  
investigation.  
ANALYSIS RE: BARRIE’S SUMMARY JUDGMENT MOTION  
[144]  
In its factum, CGI advances the following causes of action  
against Barrie:  
"Breach of contract arising from failure to disclose crucial environmental and  
archaeological information to CGI at crucial periods of time before and after entering into  
the PA;  
Breach of a duty of good faith and fair dealing which arises from the negotiation of and  
entering into the PA;  
Breach of a duty of good faith and fair dealing that arises from the municipality's  
procurement by law and also arising under the common law applicable to procurement  
and bidding of contracts in the public sphere;  
Fraudulent misrepresentation: i.e., the tort of deceit; and  
Negligent misrepresentation."  
[145]  
Each of these causes of action require either a valid and  
enforceable contract or a duty or obligation owing to CGI arising by contract or  
common law, which placed a positive duty on Barrie to disclose the  
environmental/archeological issues relating to the Allandale Lands by Barrie.  
[146]  
It is important to note that Barrie and YMCA/CGI (and later CGI)  
are sophisticated, experienced dealing with land transactions and commercial  
negotiations.  
 
Are these motions appropriate for Summary Judgment?  
[147]  
Under Rule 20, a trial is not required if a summary judgment motion  
can achieve a fair and just adjudication between the parties on the issues to be  
decided. Such an adjudication is possible, if the motion materials allow the judge  
sufficient confidence to make the necessary findings of fact, apply the law to those  
facts, which permits the judge to make a the fair and just determination.  
[148]  
If there is conflicting relevant and material evidence, the court can  
attempt to utilize its additional powers under Rule 20.04 (2.1) to make credibility  
findings. If the court is not satisfied that it can fairly make those credibility findings  
or if the court concludes that, notwithstanding using its additional powers, it cannot  
make a fair and just determination, then the summary judgment motion must be  
dismissed.  
[149]  
The onus is on the moving party, in this case Barrie, to establish that  
a trial is not required because the court can make a fair and just determination on  
the merits.  
[150]  
CGI points to the large number of documents filed on this motion. CGI  
filed a 26 page factum to respond to Barrie’s summary judgment motion, which  
attached a further 163 page evidentiary submissions as Schedule A, a 14 page  
factum to dismiss the Counterclaim and another 26 page factum to respond to the  
 
Individual Defendant’s summary judgment motion. Despite the volume of  
materials filed by both parties, I am not persuaded this is a factor in the court’s  
ability to decide these motions in accordance with the law.  
[151]  
CGI’s counsel alleges there is conflicting evidence that requires a trial.  
What CGI raises as conflicting evidence, are irrelevant to the factual and legal  
issues to be decided. These are set out in paragraph 68 of CGI’s factum:  
[152]  
Paragraph 68 (i) and (iv)  
CGI alleges there is a credibility issue whether Furbacher received the  
Historical Reports from Barrie on September 2, 2009. As stated above,  
in my view, this is not material (although Furbacher’s evidence appears to  
be very vague, self serving and specious). There is no dispute that,  
Cameron was YMCA/CGI’s lawyer during the negotiations at that time,  
was present at the August 27, 2009 meeting and received the Historical  
Reports in early September 2009.  
Furbacher admits he had no other lawyer acting on his/CGI’s behalf on  
this project at that time. Barrie had no obligation to follow up with  
Cameron to ensure Cameron had sent the materials to Furbacher.  
Cameron was CGI’s only lawyer and agent. Cameron had a duty to  
provide the information/documents to CGI. Barrie was entitled to rely that  
the delivery of the Historical Reports to Cameron was delivery to CGI and  
YMCA. Accordingly, even if the court were to accept Furbacher’s  
evidence, CGI had notice of the Historical Reports, through its counsel.  
Let me say, having reviewed Furbacher’s evidence and cross-  
examination on this point, if necessary, I would have used the court’s  
additional powers and rejected Furbacher’s evidence that he never  
received or heard of the Historical Reports sent on September 2, 2009. I  
repeat and agree with the finding of J. Healey on this point in Correct  
Group Inc. v. City of Barrie, 2013 ONSC 4477:  
[30]  
Although CGI’s counsel argued on this motion that Mr. Cameron was  
not representing CGI at the time that this statement was written, the e-mail  
exchange between Zarah Walpole, the City’s solicitor, and George Cameron on  
July 28 and 29 is in direct contradiction to such an assertion. Further, this fact is  
admitted in paragraph 25 of CGI’s Amended Statement of Claim.  
[153]  
Paragraph 68 (ii):  
CGI filed environmental expert reports and submits it is not appropriate for  
this court to making findings based on these reports. CGI submits that  
these motions turn on findings from experts’ evidence and reports. I  
disagree.  
The reports filed by CGI are not relevant to the issues to be decided and I  
explain why below. Put simply, experts are not needed for this court to  
determined whether Barrie or the Individual Defendants had a legal  
obligation to disclose the Historical Reports (or information therein) in the  
circumstances of this case or whether a valid and binding agreement was  
created by the Preliminary Agreement.  
An expert(s) opining on whether it “would have been better” or “fairer” or  
opining that there was a legal obligation by Barrie to disclose the Historical  
Reports is irrelevant.  
[154]  
Paragraph 68(iii):  
CGI alleges there is competing evidence whether an RSC was required.to  
be obtained by Barrie.  
This misses the point on several fronts. The legislation provides that an  
RSC is required to be obtained before a “change of use”. Barrie was not  
changing the use. It was selling land to a developer who would change  
the use of the land for the purpose of developing it and require an RSC  
before obtaining a building permit.  
The second issue is that the Environmental Protection Act (EPA) does not  
set out who is responsible for obtaining the RSC when that “change of  
use” is proposed.  
Thirdly, the zoning, density and other issues which would impact the  
future use for specific portions of the land, had not yet been finalized or  
had the necessary zoning approvals. As such, an RSC to meet certain  
specific, required standards based on proposed use of the lands was not  
yet known. A residential use environmental remediation standard is  
different than a commercial use environmental remediation standard.  
Fourth, even CGI’s experts do not go so far as to suggest that a vendor  
of lands must obtain an RSC before selling the land only that they should  
have known an RSC might be required before the development.  
[155]  
Paragraph 68 (vi):  
CGI submits that there is a credibility conflict whether for the “first time”  
Cameron in the August 24, 2009 draft attempted to shift the responsibility  
for environmental/archeological issues to Barrie.  
Clearly, the parties chose not to or simply didn’t deal with potential  
environmental/archeological issues when they executed the Preliminary  
Agreement despite (an issue identified in YMCA’s initial response and  
later the MOU).  
It doesn’t matter who first raised this issue during the exchange of draft  
APS?  
[156]  
Paragraph 69 (vii):  
CGI submits that there is a credibility issue whether Furbacher was it at the  
August 27, 2009 meeting.  
There is no dispute that environmental/archeological issues were  
discussed at that meeting. For the same reasons set out above regarding  
the delivery of the Historical Reports, it doesn’t matter. Cameron was  
present. Others from the YMCA/CGI group were present. If Furbacher  
chose not to attend and, instead, send his lawyer and consultants to this  
meeting, that was his decision. In any event, Furbacher’s evidence is that  
he “doesn’t recall” if he attended.  
Nothing turns on whether Furbacher was personally present at this  
meeting.  
[157]  
Paragraph 68 (viii):  
CGI makes reference to “multiple paragraphs” where conflicts exist in its  
163-page evidentiary submissions without specifically identifying the  
conflict or the material relevance.  
Having reviewed the factums, the 163 page evidentiary submissions, I  
see nothing material or relevant or a conflict which could or would effect  
this court’s ability to make a fair and just determination on the issues to  
be decided on these motions.  
[158]  
Paragraph 68 (ix):  
CGI raises, as a conflict, when Forward became aware of the Historical  
Reports in September 2009.  
In my view, when Mr. Forward knew or didn’t know about the Historical  
Reports is of no moment. There is reference at Barrie Council that previous  
owners had given Barrie “access” and “use” of all the CHUM reports. CGI  
takes this as evidence Barrie and the Individual Defendants had knowledge  
of the Historical Reports and the contents. For the purpose of these  
motions and putting CGI’s case at its highest, I will proceed on the basis  
that Barrie had knowledge of the Historical Reports (and the contents  
therein) by 2008 and, therefore, its Staff and Councillors were aware of the  
Historical Reports.  
As a result, when Forward personally became aware of the Historical  
Reports doesn’t matter if there was no duty or obligation for Barrie or its  
Staff to disclose the Historical Reports before September 2009.  
[159]  
Paragraph 68 (x):  
CGI submits there is a conflict that the Staff reports contain a reference that  
there were “no environmental concerns related to the recommendations”.  
CGI submits this shows that Barrie staff were aware or willfully didn’t  
disclose this to Barrie Council.  
CGI just ignores the words “related to the recommendations” made by staff  
– not the Allandale Lands generally.  
In any event, if there was no duty or obligation for Barrie or its Staff to  
disclose the Historical Reports before September 2009, then whether or  
not the Staff told Council is irrelevant.  
[160]  
I am not persuaded that credibility findings or evidentiary conflicts  
raised by CGI, even if they are conflicting evidence, are necessary for the just and  
fair determination of these summary judgment motions.  
[161]  
In this case, the relevant material facts required to determine the legal  
issues are not in dispute. The evidence is largely documentary. The central issues  
to be determined are the legal consequences of the undisputed facts.  
[162]  
CGI submits these motions turn on the interpretation of the  
contents of the Historical Reports. I disagree. Aside from the breach of the  
confidentiality agreement and slander claims, the majority of the issues to be  
determined turn on whether the Preliminary Agreement is a valid and enforceable  
contract and whether there was a legal duty or obligation on Barrie or the Individual  
Defendants to CGI to disclose the Historical Reports (or the information contained  
therein) at any time. As for the confidentiality and slander claims, the contents of  
the Historical Reports are entirely irrelevant.  
Was the Preliminary Agreement a valid and enforceable agreement?  
[163]  
Paragraph 114 of CGI’s Fresh as Amended Statement of Claim  
alleges that the Preliminary Agreement was a valid and enforceable contract and  
Barrie breached the Preliminary Agreement in that Barrie:  
a) “refused to comply with the Preliminary Agreement, approve drawings or  
close on the Lands”  
b) “refused to accept any of the reasonable proposals tendered by CGI”  
c) “refused to provide a counterproposal to any of the proposals tendered  
by CGI”  
d) After YMCA left the project, “Barrie refused to negotiate the purchase  
and sale of the Lands on a prorate price or any reasonable basis”  
e) “refused to finalize the redevelopment of the Lands on the terms  
prescribed by the Preliminary Agreement”  
f) By permitting the Go Station to proceed with CGI’s approval, it impacted  
the proposed site plan by CGI.  
 
Issue Estoppel  
[164]  
Barrie submits that the Preliminary Agreement is not a valid and  
binding contract, and that this court has already determined this issue. Therefore,  
“issue estoppel” applies. See the decision of J. Healy Correct Group Inc. v. City of  
Barrie 2013 ONSC 4477. Justice Healy’s decision was upheld on appeal to the  
Court of Appeal. See Correct Building Corporation et al. v Lehman et al 2018  
ONCA 462. At para 18 the Court of Appeal, after referring to J. Healy’s decision  
that the Preliminary Agreement was unenforceable or breached stated: “Before us,  
the appellant [CGI] was unable to identify the particulars of any contract that the  
respondents could have conceivable breached.”  
[165]  
Barrie relies on Zevest Development Corp. v. Kmart Canada  
Ltd, 1986 Carswell Ont 509 (Ont. Sup. Ct) at para 9, Angle v. Minister of National  
Revenue (1974) 47 DLR (3d) 544 at para 555 (SCC) and Devan v. Burdet, 2011  
ONSC 5479 at para 79 that a finding, even on an interlocutory motion, between  
the same parties, creates issue estoppel.  
[166]  
In my view, the issue before J. Healy was and is different than  
the fundamental issue before this court. Justice Healy was required to determine  
whether CGI had a “reasonable” claim to an interest in the Allandale Lands to  
anchor a registration/removal of a CPL. Justice Healy did NOT have to determine,  
on a balance of probabilities, whether the Preliminary Agreement was a valid and  
 
enforceable contract. I conclude that J. Healy’s comments that the Preliminary  
Agreement was not a valid and binding contract was not fundamental to her  
decision on the CPL motion. I proceed on the basis that J. Healy’s comments do  
not constitute issue estoppel between these parties.  
Must not be an Agreement to Agree/Negotiate  
[167]  
By any standard, the Preliminary Agreement expressly  
contemplated that the parties would negotiate, agree and execute many additional  
agreements on a large variety of issues to set out their respective obligations for  
the Lands development. The Preliminary Agreement was an “agreement to agree”  
or “agreement to negotiate”. In fact, the essence of the above noted allegations in  
the Fresh as Amended Statement of Claim are confirmatory of this conclusion.  
[168]  
Agreements to agree or negotiate are not enforceable: Walford  
v. Miles, [1992] 2 A.C. 128, [1992] 1 All E.R. 453 (H.L.); Cedar Group Inc. v. Stelco  
Inc., [1995] O.J. No. 3998, 59 A.C.W.S. (3d) 1096 (Gen. Div.), affd [1996] O.J. No.  
3974, 66 A.C.W.S. (3d) 867 (C.A.). As Lord Ackner stated in Walford, at p. 138  
A.C., "The reason why an agreement to negotiate, like an agreement to agree, is  
unenforceable, is simply because it lacks necessary certainty."  
[169]  
Agreements which require the parties to execute a subsequent  
agreement may be binding but only if there is sufficient certainty of the essential  
 
terms or a mechanism for ascertaining, with particularity, additional essential terms  
(i.e. a formula for rent). The issue is whether the provision for the future agreement  
is directory or mechanical as opposed to the substance of the provision: see Edper  
Brascan Corp. v. 117373 Canada Ltd. (2000), 2000 22694 (ON SC), 50  
O.R. (3d) 425, [2000] O.J. No. 4012 (S.C.J.), at para. 31. If it is mechanical, the  
agreement is enforceable. If it is directory, the agreement is not enforceable.  
[170]  
It must be remembered a duty or obligation to negotiate in good  
faith does NOT impose a duty on the parties to arrive at an agreement. A duty  
requiring parties to come to an agreement has never been recognized by the law.  
Must include ALL Essential Terms  
[171]  
There is a further fundament problem with the Preliminary  
Agreement to be a valid and enforceable contract. For there to be a valid and  
enforceable contract, the parties must agree on all the essential terms of the  
agreement. See Consulate Ventures Inc. v. Amico Contracting & Engineering  
(1992) Inc., [2007] O.J. No. 1663, 2007 ONCA 324, 223 O.A.C. 330 (C.A.), at  
para. 81. The rationale is the same as agreements to agree or negotiate, an  
“agreement” which lacks all the essential terms is too uncertain to be  
enforceable. Where the essential terms have not all been settled or agreed upon  
or where the contract is too general or uncertain to be valid, the agreement is not  
a valid and enforceable contract. It is not capable of interpretation or  
 
enforcement. See United Gulf Developments Ltd. v. Iskandar, [2008] N.S.J. No.  
317, 2008 NSCA 71, 69 R.P.R. (4th) 176. Cromwell J.A. (as he then was) stated,  
at para. 14:  
[page 110]  
To have an enforceable contract, there must be agreement between the parties as  
to all essential terms. To use the language of a leading case, a contract ". . . settles  
everything that is necessary to be settled and leaves nothing to be settled by  
agreement between the parties": May & Butcher Ltd. v. R. [1934] 2 K.B. 17 (H.L.)  
at p. 21. Determining what terms are "essential" in a particular case is, however,  
more difficult than stating the principle. The sort of terms that are considered  
essential varies with the nature of the transaction and the context in which the  
agreement is made: Mitsui & Co. v. Jones Power Co., 2000 NSCA 95, 189 N.S.R.  
(2d) 1 (C.A.), at para. 64.  
(emphasis added)  
[172]  
What constitutes the "essential terms" depends on the subject  
matter of the contract and the surrounding circumstances. In this case, the  
Preliminary Agreement was a framework to identify what further essential and  
critical agreements, documents and plans needed to be negotiated, finalized, and  
reduced to writing between Barrie and YMCA/CGI for a complex development of  
the Allandale Lands.  
[173]  
It is impossible to ascertain when and how the development of  
the Allandale Lands were to proceed based solely on the Preliminary Agreement.  
The Preliminary Agreement expressly sets out a number of key agreements that  
needed to be negotiated and finalized for the development. For example, the APS  
was a key agreement still to be negotiated. AND as is obvious from the MOU that  
there remained numerous other issues, terms and agreements to be resolved and  
agreed upon which had not been decided upon and included in the Preliminary  
Agreement.  
[174]  
The most comprehensive and lengthy list of terms to still be  
negotiated and finalized is set out in a document prepared by Barrie’s counsel and  
included in CGI’s Compendium: “Appendix 1 Summary Of Outstanding Issues  
Required To Be Answered Prior To Drafting Heads Of Agreement With YMCA I  
CGC Zarah Walpole, Legal Counsel June 2, 2009 ” (A1296).  
[175]  
For the reasons stated above, the Preliminary Agreement did  
not contain all the essential terms. The Preliminary Agreement was an agreement  
to negotiate further agreements. Even as pled by CGI in its claim was to allege  
that Barrie failed to negotiate in good faith to conclude the various agreements.  
See para 114 of the Fresh as Amended Statement of Claim. The way in which  
CGI’s claim was framed is almost a textbook description of an agreement to  
negotiate or agree.  
Must be a Mutual Intention to be Bound  
[176]  
Similarly, where the understanding or intention of the parties is  
that their legal obligations are to be deferred until a formal contract has been  
approved and executed, the initial agreement is not binding: see Bawitko  
 
Investments Ltd. v. Kernels Popcorn Ltd., 1991 2734 (ON CA), [1991] O.J.  
No. 495, 53 O.A.C. 314 (C.A.), at para. 21.  
[177]  
The following evidence demonstrates that the parties did not  
consider the Preliminary Agreement a binding and enforceable contract:  
a) in the Preliminary Agreement, YMCA/CGI were going to develop the  
Allandale Lands together – a joint development. However, by the summer  
of 2009, after the Preliminary Agreement had been signed, YMCA and CGI  
decided they would independently develop portions of the Allandale Lands  
– co-venturers rather than a joint venture. This was contrary to the  
Preliminary Agreement.  
b) YMCA resiled from the Preliminary Agreement in January 2010. The YMCA  
involvement was key to Barrie as it brought a “community” use to the  
Allandale Lands. This was a key factor discussed at the Barrie Council  
meetings and the decision to proceed to negotiate YMCA/CGI. Again,  
YMCA could not have done so if the Preliminary Agreement was a binding  
contract.  
c) in July and August 2009 YMCA/CGI produced two concept plans with major  
changes from the draft development concept plan. For example, CGI and  
YMCA switched the locations of their portion of the development.  
d) on August 24, 2009, YMCA/CGI’s draft APS suggested that other  
fundamental terms (such as site plan agreements and development  
agreements) would be negotiated after the APS was executed and closed.  
e) Barrie decided near the end of 2009 that it would no longer be selling the  
Train Station Lands to YMCA/CGI. Neither YMCA nor CGI raised any  
objection to this fundamental change.  
f) the parties described the negotiations as “whether” there was a “deal” to  
“move on to any form of agreement”. On July 28, 2009, Cameron, acting on  
behalf of YMCA/CGI, wrote the following to Barrie representatives:  
“...I don’t think that the City and CGI/YMCA are close enough to a deal to move on to any  
form of agreement. I think we should get a better consensus on the “deal” before we try  
to reduce it to paper”. The next day, Cameron wrote to Barrie suggesting a meeting to  
determine “whether or not there is a deal to be had between these parties.”  
[178]  
I conclude the Preliminary Agreement was not a valid and  
enforceable contract and the parties didn’t proceed on the basis that the  
Preliminary Agreement was a valid and binding contract. There is no merit to this  
allegation. This claim is dismissed.  
[179]  
Let me go on to deal with two specific issues raised by CGI with  
respect to the Preliminary Agreement.  
The Indicom Appraisal  
[180]  
CGI alleges that Barrie breached the Preliminary Agreement by  
obtaining an appraisal for the purchase price of the Allandale Lands despite the  
fact the Preliminary Agreement had a fixed price of $2,000,000.  
[181]  
The simple answer is that the Preliminary Agreement was not a  
valid and enforceable contract, so there could be no breach of the Preliminary  
Agreement, whether on price or another term, let alone because Barrie obtained  
an appraisal. On this basis alone, this claim is dismissed.  
[182]  
In any event, the RFEI specifically set out the need to comply  
with the Procurement By-Law requiring an appraisal of the Allandale Lands prior  
to the sale. On May 11, 2009, at a public Council meeting to deal with YMCA/CGI’s  
response to the RFEI, Council, by resolution, determined that the purchase price  
of $2,000,000 was subject to the completion of an appraisal.  
[183]  
I recognize that the Preliminary Agreement appeared to have a  
fixed price and no mention of an appraisal or subsequent variation to the purchase  
price.  
[184]  
Indicom appraised the Allandale Lands at $3,000,000 without  
considering significant number of factors such as environmental/archeological  
potential issues. CGI disagreed with the value set out in the Indicom appraisal. But  
what was the impact even if CGI was correct that the appraisal was overly high?  
 
As stated at para 49 of the Fresh as Amended Statement of Claim, “CGI was  
concerned that Barrie was relying on incorrect information that would jeopardize  
the completion of the redevelopment. Despite CGI’s concerns Barrie did not  
attempt to get a second appraisal of the Lands or permit CGI to conduct its own  
independent appraisal.”  
[185]  
I fail to see how obtaining an appraisal that was not acted on by  
Barrie constitutes a breach of the Preliminary Agreement (even if it was  
enforceable) when an APS was never finalized. Put another way, I fail to accept  
that Indicom’s appraisal in Barrie’s possession created an obligation on Barrie to  
sell the Allandale Lands at $2,000,000 or $3,000,000 or at any specific price to  
CGI.  
[186]  
I find no merit in this claim.  
The GO Station  
[187]  
CGI submits that Barrie breached the Preliminary Agreement  
by permitting GO to proceed with its project, whereby soil from the GO project  
“inevitably impeded CGI’s development plan and created an impediment to the  
Development Project Schedule included as Schedule “B” of the Preliminary  
Agreement”. (para 56 of the Fresh as Amended Statement of Claim)  
[188]  
CGI goes on to allege there “was an implied term of the  
Preliminary Agreement, that the Lands would be transferred to CGI in their  
 
condition as of the date of the Preliminary Agreement, and not subject to any  
material change or substantial use, such as that employed by Metrolinx and  
described above.” (para 57 of the Fresh as Amended Statement of Claim)  
[189]  
First, the Preliminary Agreement was not a valid and  
enforceable contract. This alone is fatal to this claim.  
[190]  
Second, there is no basis to imply the term as alleged by CGI.  
There is no evidence to support such an implied term.  
[191]  
Third, even if there was such an implied term, Barrie was free  
to deal with its land (while it owned it) as it saw fit until the time of closing. If such  
an implied term existed, Barrie would have been obliged to convey the lands on  
closing in the condition required by such an implied term. Since there was never  
a closing or a conveyance, there could be no breach of contract.  
[192]  
This claim has no merit.  
Implied Term to Negotiate and Complete Preliminary Agreement (paras.  
141-146 of the Fresh as Amended Statement of Claim)  
[193]  
CGI alleges that there “was an implied term of the Preliminary  
Agreement that Barrie would negotiate the agreement of purchase and sale for the  
Lands and complete the terms of the Preliminary Agreement in good faith.” See  
Para 141 of the Fresh as Amended Statement of Claim  
 
[194]  
This submission presupposes that the Preliminary Agreement  
was a valid and enforceable contract. It was not. On this basis alone, this claim  
can be disposed of.  
[195]  
No authority has been provided that imposes on a party to  
negotiate another agreement in good faith. There is no such duty or obligation to  
negotiate in good faith. The decision of the House of Lords in Walford v.  
Miles, [1992] 2 A.C. 128, [1992] 1 All E.R. 453 (H.L.) ("Walford") describes why a  
duty to negotiate in good faith is simply not enforceable:  
In Walford, Lord Ackner referring to a decision of the United States Court of Appeal, Third  
Circuit stated:  
That case raised the issue whether an agreement to negotiate in good faith, if  
supported by consideration, is an enforceable contract. I do not find the decision  
of any assistance. While accepting that an agreement to agree is not an  
enforceable contract, the United States Court of Appeals appears to have  
proceeded on the basis that an agreement to negotiate in good faith is synonymous  
with an agreement to use best endeavours and as the latter is enforceable, so is  
the former. This appears to me, with respect, to be an [page133] unsustainable  
proposition. The reason why an agreement to negotiate, like an agreement to  
agree, is unenforceable, is simply because it lacks the necessary certainty. The  
same does not apply to an agreement to use best endeavours. This uncertainty is  
demonstrated in the instant case by the provision which it is said has to be implied  
in the agreement for the determination of the negotiations. How can a court be  
expected to decide whether, subjectively, a proper reason existed for the  
termination of negotiations? The answer suggested depends upon whether the  
negotiations have been determined "in good faith". However, the concept of a duty  
to carry on negotiations in good faith is inherently repugnant to the adversarial  
position of the parties when involved in negotiations. Each party to the negotiations  
is entitled to pursue his (or her) own interest, so long as he avoids making  
misrepresentations. To advance that interest he must be entitled, if he thinks it  
appropriate, to threaten to withdraw in fact, in the hope that the opposite party may  
seek to reopen the negotiations by offering him improved terms. Mr. Naughton, of  
course, accepts that the agreement upon which he relies does not contain a duty  
to complete the negotiations. But that still leaves the vital question -- how is a  
vendor ever to know that he is entitled to withdraw from further negotiations? How  
is the Court to police such an "agreement"? A duty to negotiate in good faith is as  
unworkable in practice as it is inherently inconsistent with the position of a  
negotiating party. It is here that the uncertainty lies. In my judgment, while  
negotiations are in existence either party is entitled to withdraw from those  
negotiations, at any time and for any reason. There can be thus no obligation to  
continue to negotiate until there is a "proper reason" to withdraw. Accordingly, a  
bare agreement to negotiate has no legal content.  
(Emphasis added).  
[196]  
In any event, no term that could be implied at law in these  
circumstances. In LaFontaine v. Hartford Accident and Indemnity Co, [1961] SCR  
321, the court set out the circumstances when courts will imply a term:  
The test to be applied in determining whether or not the Court should imply a term  
which the parties have not expressed has been stated by several judges in varying  
language but without difference in substance.  
In Reigate v. Union Manufacturing Co. (Ramsbottom), Scrutton L.J. said:  
A term can only be implied if it is necessary in the business sense to give efficacy  
to the contract; that is, if it is such a term that it can confidently be said that if at the  
time the contract was being negotiated some one had said to the parties, ‘What  
will happen in such a case,’ they would both have replied, ‘Of course, so and so  
will happen; we did not trouble to say that; it is too clear.’ Unless the Court comes  
to some such conclusion as that, it ought not to imply a term which the parties  
themselves have not expressed.  
(Emphasis added).  
[197]  
Lastly, in circumstances where the parties had identified that  
environmental issues were potential issues (YMCA’s initial response to the RFEI  
and in the MOU) and the parties did not include a term of who was responsible for  
potential environmental/ archeological issues in the Preliminary Agreement, how  
and why should the court now imply such a term(s) or decide which party should  
be responsible for any potential environmental/archeological issues that might  
arise? What would be the time frame to remedy any issues? What if only a portion  
of the Lands were impacted? There is no basis to imply such a term or the details  
of what such a term should be.  
[198]  
I conclude there was no implied term imposing a duty to  
negotiate fairly in the Preliminary Agreement. Even if there was, it was not binding.  
[199]  
In any event, for the reasons set out below, I am satisfied that  
good faith negotiations took place between the parties. The fact that the parties  
could not agree on many terms, including which party would be responsible for  
potential environmental/archeological issues which might subsequently arise is  
NOT evidence of a lack of negotiating in good faith. It is a disagreement of a  
significant terms needed for the APS.  
[200]  
There is no merit to this claim.  
Breach of a Duty to Disclose (para. 143 (g) of the Fresh as Amended  
Statement of Claim)  
[201]  
CGI’s position is the Allandale Lands “required environmental  
remediation and were contaminated or that they were located on a First Nations’  
burial site.” The CGI describes the issue as follows:  
If the environmental and archeological issues identified in the Reports in the possession [  
of] Barrie showed that there were serious impediments to developing the lands as  
contemplated in the PA, did Barrie have a legal duty to disclose them to CGI?  
 
[202]  
I proceed on the basis that the contents of the Historical Reports  
were known (or ought to have been known) to the Individual Defendants and Barrie  
at the time the RFEI was issued. The fundamental question is then whether Barrie  
had a legal duty or obligation to disclose the Historical Reports (or the information  
contained therein).  
A Common Law Duty or Obligation to Disclose during Negotiations?  
[203]  
CGI’s position is that Barrie had a duty to disclose what it knew  
about the Lands because Barrie led CGI and YMCA to believe it was getting a  
clean site. However, it is important to note that by July 2009 when the first draft  
APS was exchanged, CGI and YMCA could no longer have possibly believed that  
as Barre was expressly proposing that it was not taking responsibility for potential  
environmental/archeological issues on the Lands.  
[204]  
I conclude there was no obligation or duty to disclose the  
potential environmental/archeological issues in the Historical Reports (or the  
information therein) leading up to or during the negotiations.  
[205]  
A duty to conduct contractual negotiations in good faith or a  
positive obligation to disclose negative information about one’s product or services,  
is inherently repugnant to the adversarial process of commercial negotiations.  
 
[206]  
There is no certainty or standard by which a court could enforce  
such a duty at common law. Such a common law duty could not adequately or  
reasonably be “enforced” by the court. Contrast this to situations where such a  
statutory duty of detailed disclosure exists to protect the public such as in a  
prospectus in the Securities Act or in a franchise offering in the Arthur Wishart Act.  
[207]  
Parties are entitled to pursue their own respective interests  
during the course of contractual negotiations. On the other hand, once an  
agreement is finalized by the parties, courts has jurisdiction to deal with limited  
aspects of the negotiations such as whether fraudulent or negligent  
misrepresentations were made during the negotiations but only in the context of  
the agreed upon terms in the agreement. That is because the parties have  
negotiated and agreed upon the terms of the agreement – the necessary yardstick  
for assessing any claims advanced.  
[208]  
During the course of contractual negotiations, either party is  
entitled to withdraw from the negotiations, at any time and for any reason. Would  
that amount to a breach of the duty to negotiate in good faith? Does the  
withdrawing party need a reason? Is it material enough? An agreement to  
negotiate has no legal content and parties are not obliged to continue to negotiate  
until there is a proper reason to withdraw: see Walford v. Miles, [1992] A.C. 128  
(U.K. H.L.), at p. 138; Georgian Windpower Corp. v. Stelco Inc., 2011 ONSC 5785,  
at para. 3.  
[209]  
To ensure what is important to them, during contractual  
negotiations either party can request as a term of the agreement being negotiated  
representations or warranties from the opposing side. Each party knows what is  
important to them and know what representations and warranties they want or  
need for them to come to an agreement. It is for the other party to decide what  
representations or warranties, if any, will or will not be given and included in the  
agreement. If a party wants a particular representation or term that the other party  
refuses to agree to, the remedy is to withdraw from the negotiations.  
[210]  
Absent some statutory obligation to disclose, to require parties  
to enter negotiations with an obligation to fully and completely disclose all potential  
negative facts to the opposing side (whether the other side considers them  
relevant) would eliminate due diligence, the need for representations, warranties  
and many terms. And then the issue would be what is material? Was it fully  
disclosed? Were the consequences of the negative fact disclosed? And so forth.  
[211]  
All parties enter negotiations knowing that an agreement may  
or may not be reached. Both parties take their chances, spend their time and often  
money, during the negotiations.  
[212]  
I conclude, there was no duty or obligation of good faith to  
negotiate before or after the Preliminary Agreement.  
[213]  
This claim is dismissed.  
Alternate Basis Relied on for a Duty or Obligation to Disclose  
[214]  
CGI goes on to allege that there are alternate bases for the  
existence of a legal duty to disclose the potential environmental/archeological  
issues.  
i) Bhasin v. Hrynew  
[215]  
CGI relies on the duty of good faith set out by the Supreme  
Court in Bhasin v. Hrynew, 2014 SCC 71. The Supreme Court recognized the  
requirement that parties have an obligation of carry out their contractual obligations  
in good faith:  
[33] In my view, it is time to take two incremental steps in order to make the common  
law less unsettled and piecemeal, more coherent and more just. The first step is to  
acknowledge that good faith contractual performance is a general organizing principle of  
the common law of contract which underpins and informs the various rules in which the  
common law, in various situations and types of relationships, recognizes obligations of  
good faith contractual performance. The second is to recognize, as a further  
manifestation of this organizing principle of good faith, that there is a common law duty  
which applies to all contracts to act honestly in the performance of contractual  
obligations.  
…
[65]  
The organizing principle of good faith exemplifies the notion that, in  
carrying out his or her own performance of the contract, a contracting party should have  
   
appropriate regard to the legitimate contractual interests of the contracting partner. While  
“appropriate regard” for the other party’s interests will vary depending on the context of  
the contractual relationship, it does not require acting to serve those interests in all cases.  
It merely requires that a party not seek to undermine those interests in bad faith. This  
general principle has strong conceptual differences from the much higher obligations of  
a fiduciary. Unlike fiduciary duties, good faith performance does not engage duties of  
loyalty to the other contracting party or a duty to put the interests of the other contracting  
party first.  
[66]  
This organizing principle of good faith manifests itself through the  
existing doctrines about the types of situations and relationships in which the law  
requires, in certain respects, honest, candid, forthright or reasonable contractual  
performance. Generally, claims of good faith will not succeed if they do not fall within  
these existing doctrines. But we should also recognize that this list is not closed. The  
application of the organizing principle of good faith to particular situations should be  
developed where the existing law is found to be wanting and where the development  
may occur incrementally in a way that is consistent with the structure of the common law  
of contract and gives due weight to the importance of private ordering and certainty in  
commercial affairs.  
[216]  
The duty of good faith described in Bhasin only applies to  
contractual performance. A contract, with negotiated and agreed upon terms, with  
specified rights and obligations, is necessary to establish the nature and extent of  
each parties’ obligations of good faith to each other.  
[217]  
This duty does not go so far as CGI’s counsel suggested – that  
parties to the negotiations have “an obligation to disclose what they know”.  
[218]  
In this case, YMCA and later YMCA/GCI responded to an RFEI  
and only expressed an interest in the potential development project. The parties  
to the negotiations had simply been identified. The parties knew that they had to  
“negotiate” various agreements for the development project to go forward.  
[219]  
In tender situations, the Supreme Court determined that  
"Contract A" is formed when issuing a tender. That requires the company issuing  
the Request for Tenders to act under a duty of fairness to consider the submitted  
bids in accordance with the terms of the Request for Tenders. What governs the  
obligations of good faith to the parties are the terms of the Request for Tenders.  
See Bhasin:  
[56]  
This Court has also recognized that a duty of good faith, in the sense  
of fair dealing, will generally be implied in fact in the tendering context. When a company  
tenders a contract, it comes under a duty of fairness in considering the bids submitted  
under the tendering process, as a result of the expense incurred by parties submitting  
these bids: Martel Building Ltd. v. Canada, 2000 SCC 60, [2000] 2 S.C.R. 860, at  
para. 88; see also M.J.B. Enterprises Ltd. v. Defence Construction (1951) Ltd., 1999  
677 (SCC), [1999] 1 S.C.R. 619; Tercon Contractors Ltd. v. British Columbia  
(Transportation and Highways), 2010 SCC 4, [2010] 1 S.C.R. 69, at paras. 58-59; A. C.  
McNeely, Canadian Law of Competitive Bidding and Procurement (2010), at pp. 245-54.  
(Emphasis added).  
[220]  
In a tender situation, there is detailed information in Request  
for Tenders and the tendering company can accept a compliant bid, thereby  
creating a binding contract between the tendering company and the bidder.  
Accordingly, the law has evolved to require that the tendering company has a duty  
to act in good faith when considering the bids by a set standard – the terms and  
conditions in the Request for Tenders.  
[221]  
In this case, there was no Request for Tenders. No bids. A  
tendering situation is entirely a different situation that the circumstances of this  
case. The concept of good faith or fairness has never been applied to and RFEI  
nor to negotiations. There is no reason to expand the legal duty or obligation of  
good faith to imposing such a duty on negotiating parties, particularly, in a  
commercial context.  
[222]  
I conclude there was no duty of good faith and fair dealing as  
set out by the Supreme Court in Bhasin.  
ii) Barrie’s Procurement By-Law  
[223]  
Barrie had a procurement by-law in place at the time - By-Law  
2008-121 (Procurement By-Law). CGI submits that, under the Procurement By-  
Law, Barrie had a duty of “openness, accountability and transparency”. CGI then  
extrapolates this to allege that this created a duty or obligation on Barrie to disclose  
“known problems which could be material to a proposed development” including  
the potential environmental/archeological issues to CGI.  
[224]  
[225]  
I disagree.  
The goal of the Procurement By-Law was to ensure that bidders  
are treated fairly and objectively. Section 1.1 of the Procurement By-Law provides:  
The purposes. goals. and objectives of this By-law and of each of the methods of  
procurement authorized herein are:  
a) To encourage competitive bidding;  
b) To ensure fairness and objectivity amongst bidders during the  
procurement process;  
c) To the extent possible, ensure openness, accountability and  
transparency while protecting the financial best interests of the  
Corporation and those of the Corporation's employees and elected  
officials;  
(Emphasis added).  
 
[226]  
CGI points to s. 2.2 as applying to the “disposal of .. real  
property”. Section 2.2 of the Procurement By-Law provides:  
2.2 No purchase for goods, service(s) or construction or disposal of personal  
property and real property shall be authorized unless it is in compliance with this  
Procurement By-law.  
(Emphasis added).  
[227]  
CGI was not a bidder. This was not a contest of treating  
competing bidders fairly.  
[228]  
Next, it is clear that the “disposal of the real property” didn’t  
occur. Even if the Procurement By-Law applied, there was never a “sale” of the  
Allandale Lands. If there was no disposition of the land by Barrie how can the  
Procurement By-Law apply? If the only real response is to an RFEI which doesn’t  
create an enforceable contract and the Preliminary Agreement was not a valid and  
enforceable contract, how can there be a breach of the Procurement By-Law?  
[229]  
Next, the Procurement By-Law itself provides no contractual  
obligations with respect to an RFEI. Section 10.1(a) of the Procurement By-Law  
provides that:  
REQUEST FOR EXPRESSIONS OF INTEREST (RFEOl)  
i. A request that will be used to determine the interest of the  
market place to provide goods or service(s) which the  
Corporation is contemplating purchasing. The submission of an  
expression of interest may be made a specific pre-condition of  
any other procurement procedure utilized by the Corporation.  
The submission of an expression of interest (EOI) does not  
create any contractual obligation between the Corporation and  
the Interested respondent.  
(Emphasis added).  
[230]  
Lastly, the next difficulty faced by CGI is that under “Alternate  
Procurement Methods” provides the following in s. 12.1 of the Procurement By-  
Law:  
Negotiation may be used for the procurement of goods. service(s) or construction  
or for the sale of personal or real property for any contract when one or more of  
the following criteria apply:  
….  
j) Where authorized by Council to do so.  
[231]  
On April 6, 2009, Barrie Council by resolution expressly  
authorized the execution of the Preliminary Agreement and the negotiations with  
YMCA/CGI. How can the Procurement By-Law have been breached when Council  
authorized the execution of the Preliminary Agreement?  
[232]  
Barrie to disclose any information in its possession anytime it enters into  
negotiations with a party, whether or not it is a bidding situation. That would  
I do not accept that the Procurement By-law creates a duty on  
severely handicap Barrie’s ability to negotiate commercial transactions with third  
parties.  
[233]  
CGI produced the report of Mr. Bauld, a procurement expert.  
Mr. Bauld was cross-examined. While I might agree with Mr. Bauld that it might  
be “better” for a development to proceed that any environmental/archeological  
information to be disclosed, Mr. Bauld agreed that no such obligation existed  
statutorily or by by-law for Barrie to disclose this information.  
[234]  
There is no merit to his claim.  
iii) Enhanced duty on the Municipal Defendants?  
[235]  
CGI submits that, because Barrie is a “public statutory  
corporation that is part of the machinery of government”, Barrie must exercise all  
obligations and authority in a “bona fide” manner and without “fraud, oppression or  
improper motives.”  
[236]  
The authorities relied on by CGI deal with attacks on the validity  
of by-laws. These authorities have nothing to do with a municipality dealing with  
and negotiating commercial matters.  
[237]  
In a commercial matter, a municipality is not exercising its public  
authority to enact by-laws, it is negotiating and entering into commercial  
transactions for benefit of the municipality and its residents.  
[238]  
There are no such limitations in the Municipal Act as suggested  
by CGI. Rather, the Municipal Act gives municipalities broad powers and the rights  
of a “person”;  
8 (1) The powers of a municipality under this or any other Act shall be interpreted broadly  
so as to confer broad authority on the municipality to enable the municipality to govern  
 
its affairs as it considers appropriate and to enhance the municipality’s ability to respond  
to municipal issues.  
9 A municipality has the capacity, rights, powers and privileges of a natural person for  
the purpose of exercising its authority under this or any other Act.  
[239]  
I reject that there is an “enhanced” duty or obligation on a  
municipality during negotiations. There is no merit to this claim.  
iv) Latent/Patent Defect  
[240]  
CGI submits that Barrie had a duty to disclose the defect,  
namely, potential environmental/archeological issues, which CGI describes as  
either a latent or patent defect.  
[241]  
For there to be a patent or latent defect, the vendor must have  
known of the defect, the defect was not disclosed to the purchaser and the  
purchaser must not have known before the agreement was consummated.  
[242]  
Such a claim can only be advanced after the parties enter into  
a valid and enforceable agreement. In each of the authorities relied on by CGI,  
there was a valid and enforceable contract consummated between the seller and  
buyer.  
[243]  
Here there was no valid and enforceable agreement  
consummated between these parties. CGI never acquired the Allandale Lands. It  
was not burdened by any latent or patent defect, if there was one. For example, if  
the prospective purchaser is not told of the fundamental and dangerous crack in  
 
the foundation, but never purchases the home, the purchaser has no cause of  
action for the non-disclosure.  
[244]  
There is no merit to this claim.  
v)  
Record of Site Condition (RSC)  
This claim was summarized by CGI’s counsel during  
[245]  
submissions: “the owner is responsible to deliver a clean environmental site” and  
by referencing the need for an RSC to proceed with the development.  
[246]  
The Allandale Lands were previously a train station. It had been  
abandoned for years. Everyone knew that. The proposed development would  
have created commercial and other mixed uses to be built on the Lands.  
[247]  
The RSC would be needed to be obtained even if the Lands  
were free from environmental issues because of the change in use. If there were  
environmental issues, they would need to be dealt with before the RSC could issue  
and that could delay development.  
[248]  
Paragraphs 92 and 117 of the Fresh as Amended Statement of  
Claim appears to accept that the RSC is required before a building permit could  
be obtained:  
“Staff also understood that a Record of Site Condition would be required in order to secure  
a building permit, which CGI needed to commence construction on the Lands.”  
 
“Thus Barrie understood and failed to advise CGI that it would be impossible for the  
schedule of development as outlined in the Preliminary agreement to be followed.”  
[249]  
The applicable section in the early 2009 Environmental  
Protection Act provides:  
168.3.1 (1) Subject to subsection (2), a person shall not,  
(a) change the use of a property from industrial or commercial use to  
residential or parkland use;  
(b) change the use of a property in a manner prescribed by the  
regulations; or  
(c) construct a building if the building will be used in connection with a  
change of use that is prohibited by clause (a) or (b).  
(2) Subsection (1) does not apply if,  
(a) a record of site condition has been filed in the Registry in respect of  
the property under section 168.4; and  
(b) the use specified under paragraph 3 of subsection 168.4 (2) in  
the record of site condition is the use to which the property is changed  
under clause (1) (a) or (b).  
(Emphasis added).  
[250]  
The Environmental Protection Act does not state that a vendor  
of a piece of land must obtain and/or file an RSC for an intended or potential  
change in use by a purchaser. Nor does it state that a vendor must deliver a an  
environmentally clean site.  
[251]  
Barrie would not be seeking a building permit or changing the  
use of the Lands. The Allandale Lands were to be sold to YMCA/CGI who would  
change the use to a commercial development.  
[252]  
That is not a novel situation for experienced developers such as  
CGI. Besides, I repeat environmental issues were identified in YMCA’s response  
and the MOU. CGI, an experienced developer, would know the requirements of  
the EPA and knew that an RSC was required before CGI could get a building  
permit. AND CGI knew that its bankers would require a “clean” Phase 1  
environmental report (as it did in the banker’s term sheet).  
[253]  
The allocation of risk of any environmental remediation is a  
matter of negotiation. A purchaser can do any number of things including:  
a) expressly require the vendor to assume the risk of any  
environmental/archeological issues in the APS;  
b) require the vendor to obtain a Phase 1 or 2 “clean” report to the  
standards the purchaser will need for the proposed development plan  
(which still had not been finalized) as part of the APS;  
c) take a chance and assume the environmental risk; OR  
d) negotiate a condition which permits the purchaser to perform its own  
environmental due diligence as a condition of the APS.  
[254]  
I find that CGI’s allegation that it was expressly or implicitly  
Barrie’s responsibility to obtain an RSC or deliver a clean site has no merit.  
[255]  
This claim is dismissed.  
vi) Did the Preliminary Agreement nevertheless create a duty of good faith?  
 
[256]  
The next question is whether the Preliminary Agreement  
(despite it not being a valid and enforceable contract) create a duty of good faith.  
CGI’s position is that:  
Clearly, the PA, even without the subsequent APS not being agreed upon was, in and of  
itself enforceable in respect of these duties of good faith and honest performance.  
[257]  
It would be easy to find that the Preliminary Agreement, a  
document signed by the parties, created a duty of good faith, notwithstanding that  
the Preliminary Agreement was not an enforceable agreement.  
[258]  
However, the question must then be asked – what obligation  
does that duty impose on the parties?  
[259]  
It can’t be the duty to negotiate. It can’t be that Barrie must  
agree to specific terms and conditions and execute agreements still to be  
discussed and negotiated. So, in these circumstances, what would that duty of  
good faith and honest perform mean? How would a court measure and order  
compliance? A duty of good faith can’t force parties to agree to unknown or  
unnegotiated terms or have the court act as an arbiter to decide what terms would  
be reasonable in the circumstances of such a complex development project. To  
apply it to non-enforceable contract would essentially require the court to writing  
and create contractual terms and obligations that the parties hadn’t negotiated and  
hadn’t agree to.  
[260]  
A duty of good faith cannot create obligations not agreed to.  
You can’t look to the Preliminary Agreement because it didn’t include or deal with  
all the essential terms for such a development. Even the draft APS exchanged in  
the summer of 2009 left many issues and agreements to still be negotiated.  
[261]  
I agree with the conclusion reached by J. Verbeem in Joseph’s  
Holdings Ltd. v. Windsor (City), 2018 ONSC 6163,  
[445]  
Applying the foregoing principles to the present circumstances, it is clear that  
the existence of a duty of honesty in contractual performance is, in part, predicated on  
the existence of a contract that obligates a party to perform an enforceable promise (or  
promises) that form part of the contract’s terms. In doing so, the party must not lie or  
mislead the other party about their contractual performance. Such a contract is absent  
in this instance. The plaintiff’s position that Home Depot failed to perform its contractual  
obligation to negotiate the terms of an RAA with it, in good faith, is undermined by the  
absence of a contractual term in the SPCA obligating Home Depot to unconditionally do  
so. The SPCA did not mandate that Home Depot enter into a reciprocal access  
agreement with an abutting property owner, simply on the latter’s demand. Its obligation  
in that regard was conditional and subject to the successful negotiation of an easement  
agreement on terms and conditions that were acceptable to it.  
(Emphasis added).  
[262]  
I conclude there was no duty or obligation to disclose the  
Historical Reports (or the information therein) before and after the Preliminary  
Agreement was signed.  
Did the Preliminary Agreement Expire When YMCA Terminated its Involvement?  
[263]  
CGI’s submission that the “parties by their conduct agreed to  
continue with the Preliminary Agreement” without YMCA. I reject this submission.  
 
There can be no doubt that the Preliminary Agreement expired when YMCA  
decided to “pull out” of the development.  
[264]  
The Preliminary Agreement now, in addition to not having all the  
essential terms for a valid and enforceable contract, contains many terms which  
made no sense when one of the joint developers “pulled out of the project”.  
[265]  
CGI submits that as a result of the continued negotiations  
between Barrie and CGI after YMCA’s withdrawal results constituted a novation.  
[266]  
That begs the question – what are the terms of the new  
agreement? Is that agreement binding? There still weren’t sufficient essential  
terms; now there is nothing was in writing; there is the continuing dispute over  
environmental/archeological responsibility; there are many other unresolved  
issues such as price, zoning, site plan, cost sharing, cost for pedestrian underpass,  
development time, and so on. The course of the negotiations and the draft APS  
and “Transaction Terms” exchanged by the parties amply demonstrate that there  
was much to be agreed upon including:  
a) what was a new purchase price?  
b) What portion of the Allandale Lands?  
c) what was CGI’s liability for a pedestrian underpass and roadway?  
d) what was the cost sharing agreement for the site?  
e) What was the Master Site Plan? and  
f) What was the extent of the CGI development? When a new concept plan  
was sent by CGI in June 2010, the commercial development had  
significantly increased (from 150,000 square feet in the Preliminary  
Agreement to 350,000 square feet).  
[267]  
After YMCA withdrew from the development project, the parties  
were simply negotiating, and each was entitled to consider their own respective  
best interests during the negotiations. There was no obligation to negotiate in good  
faith or to make any disclosure.  
[268]  
I reject the submission that a new valid and binding contract  
between Barrie and CGI existed after January 2010 after YMCA withdrew from the  
project.  
Nevertheless, Barrie did Negotiate in Good Faith  
[269]  
Even if there was an obligation to negotiate in good faith, I am  
satisfied that, objectively, there is NO evidence that Barrie did NOT negotiate in  
good faith after the Preliminary Agreement had been executed.  
 
[270]  
All the evidence demonstrates that Barrie did negotiate in good  
faith because:  
a) Barrie sent the first draft APS in July 28, 2009;  
b) Barrie and YMCA/CGI met on August 5, 2009 to discuss the draft APS;  
c) YMCA/CGI delivered a responding draft APS on August 24, 2009;  
d) Barrie and YMCA/CGI met on August 27, 2009 to discuss the last draft  
APS;  
e) One of the impediments was which party would assume the  
environmental/archeological issues, so on September 2, 2009, Barrie  
collected and sent the Historical Reports to the YMCA/CGI lawyer,  
Cameron;  
f) On October 2009, Barrie sent another revised APS to YMCA/CGI to  
respond to YMCA/CGI’s draft APS;  
g) Public consultation determined that the Train Station should remain  
owned by Barrie. Barrie advised YMCA/CGI of this and no objection was  
raised. Barrie Council authorized staff to continue negotiating with  
YMCA/CGI;  
h) As the environmental/archeological issues remained unresolved, in  
November and December 2009, Barrie commissioned updated  
environmental/archeological assessments and reports;  
i) In January 2010, YMCA withdrew from further negotiations under the  
Preliminary Agreement;  
j) The Preliminary Agreement came to an end;  
k) Barrie completed their updating environmental and archeological  
assessments; and  
l) Barrie agreed to and continued to negotiate with CGI for a further number  
of months during which CGI’s proposals were considered.  
[271]  
There is simply no evidence of Barrie failed to act in good faith.  
Conclusion  
[272]  
Having determined that Preliminary Agreement was not a valid  
and enforceable contract and having determined there was no duty or obligation  
to of good faith requiring disclosure as alleged, this claim is dismissed.  
Comments on the Evidence Relied on by CGI to establish a duty  
   
[273]  
As I stated above, I have come to the determinations on these  
motions without an assessment of the Historical Reports or the “expert” evidence  
advanced by CGI. Neither has any impact on whether the Preliminary Agreement  
was a valid and enforceable contract or whether a legal duty or obligation of good  
faith existed requiring disclosure.  
[274]  
However, let me make some brief comments on the evidence  
put forward by CGI as evidence that a duty to disclose existed.  
Stephen Bauld (Procurement Expert)  
[275]  
CGI included the evidence of a procurement expert, Stephen  
Bauld. Mr. Bauld concluded that the fact “Barrie had all this information and didn’t  
disclose it is the, I would say, most disturbing part.”  
[276]  
Mr. Bauld’s “report” stated that there was “a critical requirement  
under the Municipal Act to disclose any such related problems to the bidders on  
the site conditions”. Similarly, in CGI’s Compendium, it submits that Mr. Bauld’s  
“report” states:  
Failing to comply with any of these mandatory requirements by the City is in direct  
contravention of the policies, procedures, and bylaws set out in the procurement process  
of the municipality.  
 
[277]  
Mr. Bauld was clearly not dealing with the legal obligation to  
disclose information during negotiations or in response to an RFEI. That was  
admitted by Mr. Bauld:  
A. The whole idea of a request for information is to see based on certain facts if you’re  
interested in moving forward to the next process. So, I don’t know why – I mean, I’m not  
saying it should have or should have not been disclosed. I just saying, I’m, you know, as  
far as process go, 1 – I think it could have been done better.  
Q. I think, you, I think that’s – and appreciate that that’s your opinion because I – you  
know, I’m not – your report doesn’t suggest that there’s any mandatory requirement for  
this RFEI process to disclose, right?  
A. No, no, it’s not in—no, it doesn’t say that. ..  
Q. … and I’m going to suggest to you that there’s no mandatory requirement to disclose  
environmental concerns in an RFEI process. Would you agree with that statement?  
A. I would agree, that’s correct. There’s no mandatory requirements.  
Q. I’m going to suggest exactly the same for archeological issues, that there’s no  
mandatory requirement in an RFEI process to disclose archeological issues, correct?  
A. Mandatory under your lawyer, under law, I would say, no, but I have seen them done  
different where they disclose different issues that you need to be concerned about when  
you’re addressing whether even interest in being involved in the process, but you’re  
correct.  
(Emphasis added).  
[278]  
Perhaps, as suggested by Mr. Bauld disclosure might make for  
smoother or better negotiations (or an early end to them), but that is not the issue  
before the court. The issue is whether there is a legal duty or obligation to disclose  
the contents of the Historical Reports.  
[279]  
Mr. Bauld, during cross-examination, clearly stated that there  
was no policy, by-law or requirement in the Municipal Act for Barrie to have  
disclosed environmental or archeological issues. See Q/A 109 and 110 (Municipal  
Act); Q/A 113 and 114 and 138 (Barrie policy or by-law).  
[280]  
Mr. Bauld, during his cross-examination, also resiled from  
calling his document an “expert report”, instead referring to it as a two-page  
memorandum.:  
This is more of a memo than it would be – in my – my estimation of the expert witness  
reports I’ve done in the past.  
[281]  
Mr. Bauld’s evidence does not impact the courts ability to fairly  
and justly determine the issue before it, namely, whether Barrie had a legal duty  
or obligation to disclose the Historical Reports to CGI.  
James Strasman (Purchasing Consultant)  
[282]  
CGI puts forward Mr. Strasman’ evidence that he didn’t know or  
was told about the Allandale Lands Historical Reports. I see absolutely no  
relevance in this evidence. Mr. Strasman states he “would have insisted” that  
Barrie disclose any environmental/archeological issues with the Allandale Lands.  
[283]  
Strasman admitted in cross-examination that he wasn’t aware  
of who is responsible (vendor or purchaser or developer) for potential  
environmental/archeological issues.  
 
[284]  
This was not Mr. Strasman’s decision to make. What Mr.  
Strasman would have done is not relevant to the legal issue this court must decide.  
The issue before this court is whether Barrie had a legal duty or obligation to  
disclose the Historical Reports. Mr. Strasman’s opinion as to what he would have  
done is of no moment on the issue before this court.  
Dave Aspen (Former Mayor)  
[285]  
Mr. Aspen was a former mayor of Barrie from December 1, 2006  
to November 30, 2010. His evidence is that he wasn’t told about the Historical  
Reports or any environmental/archeological issues regarding the Allandale Lands.  
[286]  
The serious problem with Mr. Aspen’s evidence is that in the fall  
2009, Barrie Council (which included Mayor Aspen) was involved in rejecting latest  
YMCA/CGI draft APS because of, at least one issue, the dispute over who was  
responsible for environmental/archeological issues. Council authorized Barrie  
Staff to obtain updated environmental/archeological reports. For example, one  
Staff Report only dated December 7, 2009 which contained the following:  
2. The city is continuing its negotiations with the YMCA and the Correct Group of  
Companies for the redevelopment of the Allandale Station Lands. Retaining  
external consultants to update information on both environmental and  
archaeological conditions on the site will assist with these negotiations.  
…
5. Given changes in the sale and changes in the standards for ESA’s since the  
mid  
 
1990s, it is recommended that a phase I and II ESA be conducted on the entire  
property and any previous investigative work be forwarded to the consultant for  
reference.  
…
7. Certain areas of the current site have not been investigated for any  
archaeological  
materials. This includes the one-to-two-acre area in the vicinity of the former  
Lawn  
Bowling area on the west End of the site and the full 2.4 acre ACDC lands at the  
East End of the site. These areas will need to be investigated further by a  
consulting archaeologist, licensed by the province to undertake such works in  
accordance with standards established by the Ministry of Citizenship and Culture.  
…
14. The following environmental matters have been considered in the  
development  
of the recommendations:  
a) identifying the soil and groundwater contamination through and ESA, Phases I  
and II study is required for appraising the value of the property and assessing  
concerns with respect to future development liability when the site is sold for  
development.  
(Emphasis added).  
[287]  
Either Mr. Aspen wasn’t reading the Staff Reports or forgot what  
he knew and when.  
[288]  
Besides, Mr. Aspen’s knowledge of whether he was told about  
the Historical Reports does not assist on the central legal issues: whether the  
Preliminary Agreement formed a binding contract and whether there was a legal  
obligation to disclose the Historical Reports (or the information contained therein)  
to CGI.  
[289]  
Mr. Aspen’s evidence is of no moment to the issues in these  
motions.  
Riyaz Punjani (Environmental Engineer)  
[290]  
Mr. Punjani is a professional environmental engineer. Mr.  
Punjani opines that the Barrie staff “should have known” the Allandale Lands  
“would need to follow a rigorous due diligence process” with respect to  
environmental and archeological issues. Mr. Punjani on the environmental issues  
concludes that the Lands “will require some level of environmental due diligence”.  
[291]  
Yes, that is true. That is known to all developers and their  
consultants, like their engineers. Especially when the proposed development is to  
take place on abandoned railway lands.  
[292]  
This misses the point as to who is responsible for any  
environmental issues which might be found on the Allandale Lands. Mr. Punjani  
concludes that “ultimately a Record of Site Condition, if a portion of the lands are  
to be used for residential, Parkland or institutional uses will be required.” There is  
no dispute about that.  
[293]  
What Mr. Punjani does NOT say is that the vendor of the land  
is responsible for obtaining an RSC before the land is sold to a purchaser or that  
the vendor is required by law to disclose the environmental condition of the land  
during negotiations.  
 
[294]  
And then Mr. Punjani goes well beyond his expertise despite  
only receiving select documents from Furbacher and no further investigation or  
discussions with the City or apparently anyone else:  
“This information would also need to be disclosed to potential purchasers/developers of  
the subject property prior to a real estate transaction to allow a proper assessment of the  
potential liabilities associated with the subject property.”  
[295]  
Punjani has no expertise or sets out any basis for such a “legal  
obligation to disclose”. Mr. Punjani does not state whether, how or why such a  
disclosure is a legal requirement – that is the issue before the court. He is outside  
his area of expertise and doesn’t describe how and why such a “need” arises.  
[296]  
Mr. Punjani’s evidence does not affect this court’s determination  
on the issues before it.  
No Reliance on the Environmental/Archeological State of the Allandale Lands  
[297]  
CGI did not rely on the environmental/archeological condition of  
the Allandale Lands in its pursuit to acquire the property for development.  
[298]  
This is evident from the fact that:  
a) YMCA submitted a response to the RFEI making it clear it was expecting a  
"clean" site;  
 
b) The MOU was clear that the parties had identified other issues expressly  
including “environmental... issues etc.” had to be “covered” in other  
“agreements”;  
c) One draft of the MOU provided that the Historical Reports had been provided  
to YMCA/CGI;  
d) The parties chose not to or didn’t deal with environmental or other land  
conditions in the Preliminary Agreement;  
e) CGI continued to negotiate after the environmental issues were raised at a  
public Council meeting where its consultants were present;  
f) The parties knew that environmental and other issues needed to be agreed  
to in the MOU, but YMCA/CGI continued to negotiate to acquire the  
Allandale Lands to develop;  
g) When the first draft APS was circulated, Barrie’s refusal to accept  
responsibility for any environmental/archeological issues became known,  
yet, YMCA/CGI continued to negotiate to acquire the Allandale Lands to  
develop if Barrie would accept the financial risk of such issues;  
h) after the Historical Reports were provided to YMCA/CGI in September 2009,  
both YMCA/CGI continued to negotiate to acquire the Allandale Lands to  
develop;  
i) after CGI knew that updated environmental/archeological assessments  
were commissioned by Barrie, CGI continued to negotiate to acquire the  
Allandale Lands to develop, without asking for or knowing what the updated  
assessments would or did disclose. CGI submitted proposals for immediate  
development of the Allandale Lands;  
j) Despite knowing of the Historical Reports and the subsequent discovery of  
the archeological issues on the Allandale Lands, CGI commenced this  
action in December 2011 seeking specific performance of the Preliminary  
Agreement.  
[299]  
The real issue was, not the lack of disclosure of the information  
in the Historical Reports, but rather which party would bear the risks, costs and  
expenses of any potential remediation of environmental/archeological issues.  
[300]  
I conclude that, in any event, CGI didn’t rely on the disclosure  
or non-disclosure of the potential environmental/archeological issues on the  
Allandale Lands.  
Misrepresentation (paras. 147 -159 of the Fresh as Amended Statement of  
Claim)  
[301]  
CGI alleges that Barrie made the following misrepresentations:  
 
a) that the purchase price would be $2,000,000 by failing to tell CGI that an  
appraisal was required;  
b) that the Allandale Lands required environmental remediation or there  
was a First Nation’s burial site (i.e. would require archeological  
remediation) on the Allandale Lands. In other words, the Allandale  
Lands were not ready for immediate development.  
Development or Shovel Ready  
[302]  
CGI alleges that Barrie represented that the Allandale Lands  
were “development ready” or “shovel ready”, thereby, implicitly representing that  
the Allandale Lands had no environmental or archeological issues that would delay  
or prevent the immediate development of the Allandale Lands. CGI submits that  
this was a misrepresentation.  
[303]  
Having found that the Preliminary Agreement was not a valid  
and enforceable contract, the schedule does not create a “misrepresentation” nor  
does it create an implicit representation or term that the Allandale Lands could be  
developed immediately. Actionable misrepresentation does not occur in a  
vacuum. This alone is sufficient to dispose of this claim.  
[304]  
There is no evidence that anyone at Barrie used the words  
“development ready” or “shovel ready” in connection with this project.  
 
[305]  
There are other fundamental problems with this claim of  
misrepresentation. There was no duty owed to CGI for the reasons set out above.  
There was no reliance by CGI for the reasons set out above.  
[306]  
CGI’s reliance on the timeline in schedules to the Preliminary  
Agreement is also rejected. The first draft of the APS came well after the two  
months timetable set out in the Preliminary Agreement as the time period for the  
negotiation and closing of the APS. CGI’s last APS came more than 1 ½ years  
after the Preliminary Agreement.  
[307]  
The fact the schedules were not fixed or binding is evident from  
YMCA/CGI’s August 24, 2009 draft APS, where YMCA/CGI proposed to complete  
the development within 5 years, rather than the 3 years proposed in the Preliminary  
Agreement. AND even that was “subject to market conditions”.  
[308]  
Clearly, YMCA/CGI didn’t take the proposed timeline in the  
Preliminary Agreement as fixed or, more importantly, that the development could  
and would proceed immediately.  
[309]  
I do not find a term of the Preliminary Agreement (even if the  
Preliminary Agreement was valid and enforceable) was that the Allandale Lands  
could be developed immediately. The proposed schedule in the Preliminary  
Agreement was aggressive, never complied with by all parties.  
[310]  
I reject the claim for misrepresentation that the development  
could proceed immediately, there is no cause of action for negligent  
misrepresentation on this basis.  
[311]  
This claim is dismissed.  
Purchase Price  
[312]  
As stated above, given that a final APS was never agreed and  
executed, no one knows what the final purchase price would be in an APS. It might  
have been higher or lower.  
[313]  
CGI in 2010 offered significantly less than $2,000,000 (albeit for  
the Remainder Lands only). Moreover, the evidence demonstrates that, despite  
the Indicom appraisal, on August 30, 2010, the Staff were given authority within a  
broad range to negotiate a purchase price with CGI in 2010 (with the lower limit of  
the sale price being $1,500,000) but an agreement could not be reached on all  
other terms for an APS.  
[314]  
[315]  
I do not find that there was a misrepresentation.  
This claim is dismissed  
 
Silence  
[316]  
CGI alleges that Barrie’s silence with respect to the potential  
environmental/archeological issues amounted to a misrepresentation.  
[317]  
This is simply a “reformatted” version of CGI’s claim that Barrie  
had a duty or obligation to disclose the potential environment/archeological issues.  
[318]  
I agree with the comment by J. Perrell in Arora v. Whirlpool Canada  
LP, 2012 ONSC 4642:  
[196]  
In the context of negotiating a contract, silence or the failure to disclose material  
facts will not ground an action for misrepresentation because there is no general duty of  
disclosure between negotiating parties: Peek v. Gurney (1873), L.R. 6 H.L.  
377; Brownlie v. Campbell (1880), 5 App. Cas. 925 (H.L.); Bell v. Lever Bros. Ltd., [1932]  
A.C. 161 (H.L.); Sorenson v. Kaye Holdings Ltd., 1979 621 (BC CA), [1979] 6  
W.W.R. 193 (B.C.C.A.); Gordelli Management Ltd. v. Turk (1991), 1991 7376  
(ON SC), 6 O.R. (3d) 521 (Gen. Div.); Marathon Realty Co. Ltd. v. Ginsberg,  
(1981), 1980 1106 (AB QB), 18 R.P.R. 232 (Ont. H.C.), affd. 24 R.P.R. 155  
(C.A.), leave to appeal to S.C.C. ref’d (1982), 42 N.R. 180 (S.C.C.).  
[319]  
Besides, Furbacher, as principal of CDC and CGI, was an  
experienced landowner and developer. Considering and dealing with any potential  
environmental and/or archeological issues or who would be responsible for any  
such issues in a land acquisition is not a novel or unique but an issue in every land  
acquisition. This is corroborated by the fact it was raised by YMCA in the fall of  
2008. It was known and raised by YMCA/CGI in the March 2009 in the MOU.  
[320]  
There are two significant points to remember: the discovery of  
the human remains was found at the Train Station (the portion Barrie was going to  
 
retain); and this was found after negotiations between Barrie and CGI had ended.  
This information was not contained or known in the Historical Reports.  
[321]  
Silence did not amount to a misrepresentation.  
Fraudulent  
[322]  
In its factum and submissions CGI alleged that Barrie’s  
misrepresentations were fraudulent. Having found no misrepresentation by Barrie,  
I do not find there were any fraudulent misrepresentations made by Barrie.  
[323]  
This claim is dismissed.  
Breach of Confidentiality Agreement (paras. 121 – 123 of the Fresh as  
Amended Statement of Claim)  
[324]  
Under the Preliminary Agreement, CGI was to provide financial  
information to satisfy Barrie that it had the financial wherewithal to complete the  
development. On April 29, 2009, Barrie signed a confidentiality letter.  
[325]  
On May 25, 2009, four of the Barrie representatives, signed a  
confidentiality agreement when they attended at CGI’s offices to review CGI’s  
financial information.  
   
[326]  
CGI alleges that Barrie breached the Confidentiality Agreement  
by disclosing the site plans to Indicom. The problem with this allegation is that  
YMCA/CGI’s lawyer, Cameron, authorized in writing to the disclosure of these  
plans to Inidicom.  
[327]  
CGI alleges that “financial information” was disclosed to  
“extended members of staff and council”. There is no evidence that any of the  
four individuals (the ones who obtained the financial disclosure) disclosed any of  
the financial information. Each of the four individuals stated under oath that they  
did not disclose the confidential financial information to anyone else. They were  
not shaken on this issue during cross examination.  
[328]  
Furbacher was cross-examined on this issue. Furbacher can’t  
identify who or what was disclosed. He just “believes” the information was  
disclosed contrary to the confidentiality agreement.  
[329]  
Lastly, CGI pleads that the financial and intellectual information  
was disclosed in this proceeding in Forward’s affidavit of March 27, 2012. The  
problem with this allegation is that in CGI’s Statement of Claim dated December  
15, 2011, alleged that Barrie had obtained the Indicom appraisal “using CGI’s  
documents”. See paras, 66 and 68(b) of the Statement of Claim. Accordingly, it  
was necessary for Barrie to fully respond to the allegation and is therefore not  
actionable.  
[330]  
There is no merit to this claim.  
Breach of Fiduciary Duty (paras. 133- 140 of the Fresh as Amended  
Statement of Claim)  
[331]  
Paragraph 133 of the Fresh as Amended Statement of Claim,  
alleges:  
CGI pleads that as a result of Barrie’s position of power as a municipality and because  
it sought out to solicit CGI to submit a new proposal with the YMCA, Barrie owed CGI a  
fiduciary duty.  
[332]  
Essentially, in para 139 of the Fresh as Amended Statement of  
Claim, CGI alleges that, because it was within Barrie’s discretion and power as to  
whether, how and when to proceed with the development or come to terms on the  
agreement identified in the Preliminary Agreement, this “ultimately placed CGI in  
a peculiar position of vulnerability at the discretion of Barrie.”  
[333]  
[334]  
This allegation is nonsense.  
In any negotiations, each party is at the discretion and power of  
the other party as to the terms of any agreement and whether an agreement is  
ever achieved. To accept this claim would elevate any and all negotiations  
between parties, including commercial negotiations between sophisticated parties,  
to a fiduciary relationship.  
 
[335]  
There is nothing unusual or exceptional in this case that would  
create a fiduciary relationship between two commercial parties negotiating a real  
estate development project or a need in law to expand fiduciary relationships to  
these situations.  
[336]  
There is no merit to this claim.  
Slander and Damage to Reputation (paras. 71 – 79 of the Fresh as  
Amended Statement of Claim)  
[337]  
CGI no longer advanced this cause of action during these  
motions.  
[338]  
There are serious pleading deficiencies with this cause of action  
(the requirement of particularity), a serious issue whether the statements made  
were defamatory to CGI (a company incorporated solely for this project) and a  
failure to issue a notice and a limitation period for the defamatory statements in the  
media.  
[339]  
This claim is dismissed.  
Unjust Enrichment (paras. 160 – 169)  
   
[340]  
Essentially, CGI pleads (in para 166) that because it did not  
acquire the Allandale Lands, Barrie is unjustly enriched while CGI is deprived of  
the benefits.  
[341]  
[342]  
CGI did not pursue this cause of action during these motions.  
Rightly so. The benefit to Barrie is unknown. The deprivation  
to CGI is unknown. There is no evidence that Barrie received any benefit from  
CGI’s work on the Allandale Lands.  
[343]  
Besides, if there is a benefit to Barrie from the future  
development of the Allandale Lands, the juristic reason is simple – it owns the  
lands. Not CGI.  
[344]  
This claim has no merit.  
Limitations Act Defence  
i) Date Barrie advised that the Preliminary Agreement was not binding  
[345]  
Barrie submits that the action is statute barred because, on  
August 11, 2009, Barrie advised that it did not consider the Preliminary Agreement  
binding.  
[346]  
I am not persuaded that the limitation period runs from this date.  
IF the Preliminary Agreement was a valid binding contract, the limitation period  
   
would not run until the breaching party took steps inconsistent with the Preliminary  
Agreement. Here both parties continue to negotiate after August 11, 2009.  
[347]  
I reject this claim.  
ii) Date Barrie Provided the Historical Reports to YMCA/CGI  
[348]  
The Historical Reports were provided to YMCA/CGI’s counsel  
in September 2009. This proceeding was commenced on December 15, 2011.  
[349]  
As stated above, regardless of how the cause of action is  
phrased, CGI’s underlying factual basis is that Barrie did not disclose the  
environmental/archeological information known to it – the Historical Reports (or the  
information contained therein).  
[350]  
The Historical Reports were delivered by Barrie to YMCA/CGI’s  
counsel in September 2009. The information that CGI says should have been  
disclose was then known. YMCA/CGI then had all the information that Barrie had  
in its possession. There is no discoverability issue. The limitation period ran from  
this date.  
[351]  
In my view, the limitation period on all CGI’s cause of actions,  
which rely on Barrie’s failure to disclose the environmental/archeological it had in  
its possession started to run on September 2, 2009. The Limitation Act requires  
that the CGI claims be commenced within 2 years.  
 
[352]  
This action is brought more than two years after the Historical  
Reports were disclosed to YMCA/CGI.  
[353]  
If it had been necessary, I would have dismissed CGI’s lack of  
disclosure claims as statute barred.  
Conclusion on Barrie’s Summary Judgment Motion  
[354]  
Barrie’s summary judgment motion is hereby granted  
dismissing all of CGI’s claims against Barrie.  
ANALYSIS RE: CLAIMS AGAINST THE INDIVIDUAL DEFENDANTS  
[355]  
All the Individual Defendants, except Magwood, were staff or  
councillors during the period between 2009 to 2011.  
[356]  
Forward, Babulic, Foster, Archer and McKinnon were employed  
by Barrie as Barrie Staff (Barrie Staff).  
[357]  
Magwood was employed by a company retained by Barrie to  
facilitate the negotiations of the Allandale Lands. Magwood was an agent acting  
on behalf of Barrie with respect to this project.  
[358]  
The rest of the Individual Defendants were Barrie Councillors.  
   
[359]  
It is important to note that Council meetings are open to the  
public, the minutes, directions and related staff reports are, subject to some  
exceptions, publicly available on Barrie’s website.  
The CGI Claims  
[360]  
CGI advances the following causes of action against the  
Individual Defendants:  
CGI advances the following causes of action as against these Defendants:  
a) Negligent misrepresentation arising from their failure to disclose crucial environmental  
and archaeological information to CGI during crucial periods of time before and after  
entering into the PA;  
b) Breach of a duty of good faith and fair dealing;  
c) Breach of a duty of good faith and fair dealing that arises from the municipality's  
procurement by-law and also arising under the common law applicable to procurement  
and bidding of contracts in the public sphere;  
d) Fraudulent misrepresentation: i.e. the tort of deceit; and  
e) Conspiracy to injure the Plaintiff.  
[361]  
At the core of CGI’s claim (except for the breach of the  
confidentiality agreement) is that the Individual Defendants, before and after the  
Preliminary Agreement “were well aware of the environmental contamination and  
archeological issues on the site”, knew that Barrie failed to investigate, failed to  
disclose these issues to CGI, and said that the Allandale Lands were “shovel  
ready” or “development ready”.  
 
[362]  
First, there is no evidence that any of the Individual Defendants  
used the words “shovel ready” or “development ready”.  
Immunity under the Municipal Act  
[363]  
The Individual Defendants claim they have immunity under the  
Municipal Act for the claims advanced. The relevant provisions of the Municipal  
Act provide:  
448. (1) No proceeding for damages or otherwise shall be commenced against a  
member of council or an officer, employee or agent of a municipality or a person acting  
under the instructions of the officer, employee or agent for any act done in good faith in  
the performance or intended performance of a duty or authority under this Act or a by-  
law passed under it or for any alleged neglect or default in the performance in good faith  
of the duty or authority.  
(2) Subsection (1) does not relieve a municipality of liability to which it would otherwise  
be subject in respect of a tort committed by a member of council or an officer, employee  
or agent of the municipality or a person acting under the instructions of the officer,  
employee or agent.  
(Emphasis added).  
[364]  
Accordingly, all Individual Defendants, as staff members and  
Councillors and Magwood (as an agent of Barrie), are immune from personal  
liability for any act done in the good faith in the performance or intended  
performance of their duties.  
[365]  
The Court of Appeal set out the standard to establish liability on  
a councillor in The Toronto Party v. Toronto (City), 2013 ONCA 327:  
[43] To establish the personal liability of individual members of a municipal council, the  
party who seeks to establish liability must prove the relevant conduct was done  
 
maliciously or in bad faith, thus amounting to a misfeasance in public office: Region  
Plaza, at p. 755 O.R.; Kelliher (Village) v. Smith, 1931 1 (SCC), [1931] S.C.R.  
672, [1931] S.C.J. No. 47, at p. 681 S.C.R.; and Jones v. Swansea City Council, [1990]  
1 W.L.R. 54, [1989] 3 All E.R. 162 (C.A.), at p. 69 W.L.R.  
(Emphasis added).  
[366]  
The 6th edition (Henry Campbell Black, M.A., Black’s Law  
Dictionary, 6th ed., (Minnesota: West Group, 1990)) defines bad faith in terms, at  
p. 135:  
The opposite of “good faith,” generally implying or involving actual or constructive fraud,  
or a design to mislead or deceive another, or a neglect or refusal to fulfill some duty or  
some contractual obligation, not prompted by an honest mistake as to one’s rights or  
duties, but by some interested or sinister motive. Term “bad faith” is not  
simply bad judgment or negligence, but rather it implies the conscious doing of a wrong  
because of dishonest purpose or moral obliquity; it is different from the negative idea of  
negligence in that it contemplates a state of mind affirmatively operating with furtive  
design or ill will.  
(Emphasis added).  
[367]  
Starline Entertainment Centre Inc. v. Ciccarelli (1995), 1995  
7132 (ON SC), 25 O.R. (3d) 765 (Gen.Div.) at p. 778 makes clear that,  
“bad faith is different from negligence because the former involves intent”.  
[368]  
In Salehi v. Association of Professional Engineers of Ontario,  
2016 ONCA 438, the Court of Appeal made the following comments regarding bad  
faith:  
[9]  
The party claiming bad faith must provide specific allegations of it. For  
example, he or she must allege conduct founded upon fraud or oppression,  
or an improper purpose or motive, such as an intention to mislead or deceive or to  
deliberately cause harm: see e.g. Sampogna v. Smithies, 2012 ONSC 610, 94  
M.P.L.R. (4th) 320, at para. 16; and Burns v. Johnston, 2003 CanLi 44408 (Ont.  
S.C.), at paras. 29-34. A mere error or omission is not evidence of bad faith: Burns  
v. Johnston, at para. 32. See also Toronto Sun Wah Trading Inc. v. Canada  
(Canadian Food Inspection Agency), 2014 ONCA 803; and Deep v. Massel, 2007  
27969 (Ont S.C.), aff’d 2008 ONCA 4.  
(emphasis added)  
[369]  
Pursuant to s. 448(2) of the Municipal Act, Barrie remains  
vicariously liable for any tortious acts committed by its staff or councillors, even if  
done in good faith.  
[370]  
Except for the breach of a confidentiality agreement, CGI’s  
claims are claims of negligent misrepresentation, breach of duty of good faith,  
breach of the Procurement By-Law and common law, fraudulent misrepresentation  
and conspiring to injure the Plaintiff. At the core of these claims are that the  
Individual Defendants failed to disclose the potential environmental/archeological  
issues on the Allandale Lands.  
[371]  
CGI points to authorities that “where the actions of an officer or  
employee or agent, or anther person standing behind the corporation acting as its  
operative, are themselves tortious, or exhibit a separate identity or interest from  
that of the corporation, personal liability will follow.” This submission entirely  
ignores the unique circumstances that the Individual Defendants have the  
protection of the immunity provisions of the Municipal Act.  
[372]  
There is no evidence that any of the Individual Defendants were  
not acting in good faith or acting outside the scope of their duties or carried out  
their duties to Barrie for an improper or ulterior motive to deceive or harm CGI.  
[373]  
There is no evidence that any of the Individual Defendants said  
or did anything contrary to what they believed was in Barrie’s best interests.  
[374]  
At its highest, even if CGI’s allegations are accepted, CGI  
claims could at most be negligence, omission or recklessness (none of which I  
accept) in not disclosing the potential environmental/archeological issues to CGI.  
BUT more is required to establish a lack of good faith. That “more” is entirely  
missing in this case.  
[375]  
Equally fatal to the claim is that, if there is no duty on Barrie to  
disclose the potential environmental/archeological issues, how could there be a  
duty on its Staff, Councillors or agents to make that same disclosure? There would  
have to be additional circumstances that create a specific duty between a particular  
Individual Defendant and CGI to have disclosed the information. No such  
circumstances are evident or advanced.  
[376]  
Accordingly, the Individual Defendants are entitled to the  
immunity under the Municipal Act.  
[377]  
Given the potential for vicarious liability, I will proceed through  
each of the claims advanced by CGI against the Individual Defendants.  
[378]  
However, first, I will deal with several general concepts relevant  
to the analysis of the various claims alleged by CGI against the Individual  
Defendants.  
Failure to Disclose Information to Council  
[379]  
CGI goes on to make submissions that Barrie Staff failed to  
advise Barrie Council of the environmental/archeological issues on the Lands.  
[380]  
This is not a basis for a cause of action by CGI. If there was  
such an obligation, it was not for CGI’s benefit, it was for Barrie’s benefit. If such  
an obligation existed and it was breached by the Barrie Staff, then that is an issue  
between Barrie and the Barrie Staff and does not establish a duty or liability to CGI  
by either Barrie Staff or vicarious liability to Barrie.  
[381]  
Essentially, CGI submits that this failure by Barrie Staff to  
disclose to Barrie Council is evidence of bad faith or lack of good faith. I reject this  
submission. There is no evidence that any such failure (which I do not accept)  
was directed at or improperly motivated to harm CGI.  
[382]  
Lastly, there is no connection between the alleged failure by  
Staff to advise Barrie Council and Barrie’s failure to advise CGI of the potential  
environmental/archeological issues since Barrie had no obligation to disclose this  
information to CGI.  
 
[383]  
I reject this submission.  
Failure to recommend CGI’s proposals to Council  
[384]  
CGI alleges that Foster, Babulic, Forward and Lehman  
represented that they would recommend CGI’s proposals to Council, but  
eventually recommended that CGI’s “compromises” be rejected.  
[385]  
There is no evidence to support this allegation. There is no  
evidence to establish a duty owed by each or any of these Individual Defendants  
to CGI.  
[386]  
There is no evidence of detrimental reliance. Furbacher knew  
that the ultimate decision was that of Council.  
[387]  
Besides, these allegations relate to November and December  
2010 and December 2011, a time when the parties were negotiating and, even if  
true, there was nothing preventing these Individual Defendants from changing their  
minds when making their recommendations to Council. They had a duty to Council  
to provide Council with their best recommendation with Barrie’s interests in mind.  
[388]  
This claim has no merit.  
Significance of the Dismissal of CGI’s Claim against Barrie  
   
[389]  
The most serious impediment to CGI’s claim against the  
Individual Defendants is that if there was no obligation for Barrie to disclose any  
potential environmental/archeological issues to CGI for the reasons set out above,  
then how could there have been an obligation or duty on the Individual Defendants  
to have disclosed any potential environmental/archeological issues to CGI?  
[390]  
None of the Individual Defendants were employed by CGI.  
There are no circumstances that any of them owed a duty to CGI.  
[391]  
In fact, had the Individual Defendants disclosed the potential  
environmental/archeological issues, that may well have constituted a breach of  
their duty to Barrie. There is no basis to find an independent contractual or  
common law duty owed by the Individual Defendants to CGI.  
[392]  
Hence, there can be no liability from the Individual Defendants  
to CGI arising from the lack of disclosure of any environmental/archeological  
issues.  
[393]  
And Furbacher knew that, even the Councillors, could not bind  
Barrie, Council approval would be necessary. So, Furbacher could not have relied  
on what the Councillors (or for that matter Staff or agents) said or didn’t say about  
the Lands, negotiations or any aspect of the process.  
Latent and Patent Defect  
[394]  
For similar reasons to those set out above with respect to  
Barrie, there is no liability on the Individual Defendants (directly or vicariously to  
Barrie) to CGI for not disclosing a latent or patent defect.  
[395]  
In addition, the Individual Defendants were not the seller of the  
Allandale Lands. CGI just ignores this fundamental and fatal difference.  
[396]  
I reject this claim.  
Breach of Confidentiality Agreement  
[397]  
Four individuals (Forward, Archer, McKinnon and Magwood,  
signed confidentiality agreements at a meeting to review CGI’s Financial Package.  
[398]  
CGI alleges that the four individuals breached the confidentiality  
agreement. The problem is that Furbacher “believes” there was a breach but has  
no evidence and cannot point to any individual who disclosed or a specific  
document/information that was disclosed contrary to the confidentiality agreement.  
[399]  
All four Barrie representatives, who signed the confidentiality  
agreement, expressly deny under oath, that they disclosed any of the information  
or documentation to any party not a signatory to the confidentiality agreement.  
They were not shaken during cross examination. There is no evidence they did.  
   
[400]  
There is one exception: draft site plan drawing, which was sent  
to the Barrie appraiser but, with the prior approval by YMCA/CGI’s solicitor,  
Cameron, on October 29, 2009.  
[401]  
There is no merit to this cause of action. It is dismissed.  
Negligent Misrepresentation  
[402]  
CGI submits that there was sufficient proximity between CGI  
and Barrie to establish a duty on the part of the municipality. Then CGI goes on  
to submit:  
The Barrie Defendants [Individual Defendants} herein owed a duty of care due to the closeness of  
the relationship and foreseeability of harm to CGI if the representations were untrue or misleading.  
[403]  
CGI does not explain how or why this “closeness of relationship”  
arose CGI and the Individual Defendants. There is no basis for such a duty owed  
by the Individual Defendants to CGI.  
[404]  
Then the “foreseeability of harm” refers to failed negotiations. If  
this creates a duty then every officer, director or employee of a company involved  
in commercial negotiations owes a duty to the opposite party, notwithstanding that  
it conflicts or may conflict with the duty owed to its company. This makes no  
commercial sense.  
 
[405]  
In any event, since Barrie had no such duty, and no obligation  
to disclose any potential environmental/archeological issues to CGI, then CGI’s  
theory of “closeness” falls entirely apart.  
[406]  
Then we come to the “representations that were false or  
misleading”. There is no representation made by any Individual Defendant that  
CGI can or points to other than the “silence” by the Individual Defendants to  
disclose the potential environmental/archeological issues. This takes us back to  
the law that “silence” during negotiations (i.e. the lack of disclosure) does not  
amount to a representation, let alone an actionable misrepresentation.  
[407]  
This cause of action has no merit.  
Bad Faith in the Context of Municipal Defendants  
[408]  
CGI alleges that Barrie had a higher duty or obligation given that  
it is “part of the machinery of government” or that these were negotiations in the  
“public sphere”. For the reasons set out above, this submission was rejected as  
it relates to Barrie. The similar reasoning applies to the Individual Defendants.  
[409]  
Again, CGI does not explain how this alleged higher duty  
somehow transferred to, creates and imposes on the Individual Defendants a duty  
owed to CGI.  
[410]  
I reject any basis for this cause of action.  
 
Breach of Duty of Good Faith  
[411]  
CGI alleges that each of the Individual Defendants owed a duty  
of good faith to CGI, which they breached.  
[412]  
The employees of the opposing party negotiating a commercial  
transaction is not a recognized fiduciary relationship creating a duty. Nor would it  
make any commercial sense to recognize such a duty.  
[413]  
Given that such a duty would be antithetical to the very essence  
of negotiations between two commercial parties, there is no reasonable or  
considered basis to suggest a new category should be created.  
[414]  
There is no duty of good faith on the Individual Defendants to  
CGI and, hence, there can be no breach of such a duty and no cause of action.  
Public Misfeasance  
[415]  
CGI alleges that the Individual Defendants committed a public  
misfeasance.  
[416]  
Public misfeasance requires a public officer to engage in  
deliberate and unlawful conduct in their capacity as a public officer, and the public  
officer knows the unlawful conduct will cause harm to the Plaintiff.  
   
[417]  
The Individual Defendants are not public officers except the  
CGI does not specify what deliberate, unlawful conduct was  
Barrie Councillors.  
[418]  
committed by the Barrie Councillors.  
Surely, the nondisclosure of any  
environmental/archeological information to CGI was neither actionable nor  
unlawful conduct by Barrie, then the Councillors had no obligation to disclose the  
information to CGI.  
[419]  
CGI does not put forward any evidence that the deliberate  
actions of the Barrie Councillors knew that their actions were likely to harm the  
CGI.  
[420]  
There is no merit to this cause of action.  
Breach of a Common Law Procurement Duty  
[421]  
Clearly, the Procurement By-Law would not apply to the  
Individual Defendants. The Individual Defendants were not selling any Barrie  
assets or engaged in a personal bidding situation.  
[422]  
Hence, CGI alleges that the cause of action arises “under the  
common law applicable to procurement and bidding”. How this duty arises on a  
non-negotiating party (particularly employees, staff and agents of the opposing  
negotiating party) is not explained by CGI.  
 
[423]  
No authority was put forward where a non-negotiating, third  
party owed a duty to either of the negotiating parties.  
[424]  
CGI.  
There is no such duty owed by the Individual Defendants to  
[425]  
There is no merit to this cause of action. It is dismissed.  
Fraud and Fraudulent Misrepresentation  
[426]  
CGI makes the following submission:  
If the Defendants knew about a latent defect and took active steps to conceal it, and this  
defect made the premises uninhabitable, then, the principle of caveat emptor has reached  
its limit. Such conduct amounts to fraudulent misrepresentation.  
[427]  
This simply ignores that the Individuals were not sellers. It ignores  
that there is no evidence that any of them took active steps to conceal any  
environmental/archeological issues with the Allandale Lands.  
[428]  
There is no “special relationship” between the Individual Defendants  
and CGI to create a duty of care.  
[429]  
There is no evidence that the Individual Defendants wilfully intended  
to deceive or mislead CGI. This is an essential element of fraudulent  
misrepresentation.  
[430]  
There is no evidence that the Individual “intended” CGI to act on the  
misrepresentation, nor that CGI relied on it to its detriment. The alleged lack of  
 
disclosure by the Individual Defendants did not cause CGI to act based on the  
alleged fraudulent representation.  
[431]  
CGI also alleges that “silence” (i.e. the non-disclosure) amounted to a  
misrepresentation. I reject this for the same reasons set out above. In any event,  
there was no special relationship between the Individual Defendants and CGI  
creating a duty to fully disclose or was a situation where a misleading  
representation was made by Individual Defendants which led an agreement.  
Neither apply in this case.  
[432]  
As for any expenses CGI incurred to the date of the disclosure of the  
Allandale Lands Historical Reports, CGI knew that numerous agreements, site  
plans, zoning requirements and many other issues needed to be negotiated and  
agreed upon, and if they weren’t finalized, CGI would have no recourse for its  
expenses. CGI was expending money and time to attempt to acquire the Allandale  
Lands, as many developers due and not all attempts materialize into an  
agreement.  
[433]  
There is no cause of action for fraud or fraudulent representation. This  
claim is dismissed.  
Conspiracy to Injure the Plaintiff  
 
[434]  
CGI.  
CGI alleges that the Individual Defendants conspired against  
The tort of conspiracy to injure requires that the evidence  
[435]  
establishes that the Individual Defendants entered into an agreement where  
predominant purpose was to injure CGI, whether the means used are lawful or  
unlawful.  
[436]  
As I stated above, there is no evidence that the Individual  
Defendants, individually or collectively, entered into an agreement where the  
predominant purpose was to injure CGI. As described above, there were ongoing  
negotiations. The fact the parties arrived at an impasse on the issue of the  
potential environmental/archeological issues (and many other issues) is not  
evidence that the Individual Defendants conspired to harm CGI, nor that the  
predominant purpose of their actions was to harm CGI.  
[437]  
Since Barrie had no obligation to disclose the potential  
environmental/archeological issues on the Allandale Lands, the actions of its Staff,  
Councillors and facilitators could not possibly be unlawful conduct.  
[438]  
There is no merit to this cause of action.  
Inducing Breach of Contract  
 
[439]  
While alleged as a cause of action in the Statement of Claim,  
this cause of action was not pursued by CGI at these motions.  
[440]  
In any event, having found that the Preliminary Agreement was  
not a valid and enforceable contract, no actions by the Individual Defendants could  
amount to an inducing breach of contract.  
Slander and Damage to Reputation  
[441]  
Once again, this cause of action was pleaded but not pursued  
by CGI at these motions.  
[442]  
The alleged defamatory statement was Lehman’s press release  
in December 2011, ending the negotiations with CGI.  
[443]  
First, there is nothing apparently defamatory in the press  
release.  
[444]  
Second, no notice was given by CGI within the time period  
required by the Libel and Slander Act and this action was not commenced within  
the prescribed time.  
[445]  
There is no merit to this cause of action  
The Limitation Act  
   
[446]  
I will not repeat the analysis and conclusion set out above. It  
equally applies to the Individual Defendants. In fact, more so. Almost 2 years after  
CGC and CGI commenced the action against Barrie, on December 16, 2013, CGC  
and CGI then commenced this action against the Individual Defendants.  
[447]  
Clearly,  
the  
issues  
regarding  
the  
potential  
environmental/archeological issues were known to CGI in August / September  
2009 or certainly in early 2010 when it knew new update assessments had been  
commissioned, or by September 2010 when Barrie advised it would no longer  
negotiate exclusively with CGI or in mid-2011 when Barrie placed the Allandale  
Lands back on the market. Whatever starting point you choose, they are all more  
than 2 years before he action was commenced against the Individual Defendants.  
[448]  
On this basis alone, a two-year limitation period would have  
long before expired and was statute barred.  
Conclusions on Individual Defendants’ Summary Judgment Motion  
[449]  
CGI’s action against the Individual Defendants is hereby  
dismissed in its entirety.  
COSTS  
[450]  
Cost Outlines were delivered by both parties at the conclusion of the  
hearing.  
   
[451]  
Barrie and the Individual Defendants shall provide written  
submissions within four weeks of today’s date, with a limit of 15 pages of  
submissions, PLUS Bills of Costs, any Offers, PLUS any Authorities.  
[452]  
CGI shall provide written responding submissions within four weeks  
of the receipt of Barrie/Individual Defendant’s submissions, with a limit of 15 pages  
of submissions, PLUS any Offers, PLUS any Authorities.  
[453]  
There shall be no reply without leave.  
__________________________  
RSJ Ricchetti  
Released: January 25, 2022  
CITATION: Correct Building Corporation v. Lehman, 2022 ONSC 527  
COURT FILE NO.: CV-13-00005678-00; & CV-11-00000384-00  
DATE: 2022 01 25  
ONTARIO  
SUPERIOR COURT OF JUSTICE  
B E T W E E N:  
CORRECT BUILDING CORPORATION  
- and -  
LEHMAN  
AND BETWEEN:  
CORRECT GROUP INC.  
-and-  
THE CORPORATION OF THE CITY OF  
BARRIE  
REASONS FOR JUDGMENT  
Ricchetti RSJ.  
Released: January 25, 2022  


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