By Don Lapowich
An application was made by an elderly mother and grandmother. The grandmother, her son and her grandson were co-tenants of a 23-unit residential apartment building and owned one-third “undivided interest” in that property. The grandmother was concerned that her son (supported by her grandson) had complete control and administration and did not properly account to her for the rents and laundry machine collections. She sought a sale of the property and the appointment of a receiver/manager. She asked that the sale proceeds then be divided equally.
The Ontario Court held that the mother had a prima facie right to the sale of the property and she was not being oppressive or moving with malice or vexatious intent.
If there was hardship, it was that of the mother who never received a proper accounting of her interest. Because of the mother’s age (93) it was important that the sale take place and that the issues be tried. The court found that the son would not accept that all three co-owners had equal rights. (Settecase v. Settecase, 2013 ONSC 6580)
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Definition of damages: A contractor was found negligent in the construction of a building. The building contained defects leading to real and substantial danger (structural defects) to occupants. The reasonable costs of repairing the defects and putting the building back into a non-dangerous position were recoverable by the purchasers.
The interesting part of this case is the Alberta Court of Appeal’s statement that harm need not be “imminent”. There was reasonable likelihood the construction defects posed a real and substantial danger. (Vargo v. Hughes, 2013 ABCA 96)
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Partnership agreements – particularity: In a recent decision of the Superior Court of Ontario, a Toronto lawyer entered an agreement when becoming a partner to make annual goodwill payments of $25,000 for five years. However, two years later the partner left the firm. The partnership attempted to enforce the five-year obligation.
The Superior Court held that a law firm had the obligation to particularize what would happen if the five years did not expire whether by death, leaving the law firm or otherwise. Here, the partnership agreement did not cover this situation and therefore the courts held that the partnership itself was responsible for the ambiguity and lack of guidelines. The partner was relieved of any further payments once he left the partnership.
This is a good case to emphasize that any agreement, but particularly in a partnership agreement, one must specify the particulars of alternative positions to the rule that they incorporate into their partnership agreement. (Djurdjevac v. Deacon, Spears, 2013 ONSC 7052)
Donald Lapowich, Q.C. is a partner at the law firm of Koskie, Minsky in Toronto, where he practices civil litigation, with a particular emphasis on real estate litigation and mediation, acting for builders, real estate agents and lawyers.
