Housing for mentally challenged individuals has recently been in the news.
Take the case of balancing that interest and the interest of other inhabitants in a recent case where a condominium owner suffered from paranoid schizophrenia for many years. The owner’s symptoms varied in intensity for some 15 years while she lived in the condominium, and led to numerous difficulties with her neighbours.
The condominium unit corporation moved for the owner’s compliance with the declarations, bylaws and rules. By order, the corporation could inspect the unit in question as it saw fit. This order was not appealed.
Unfortunately, there were continuing breaches to the bylaws and the court ordered the mentally challenged owner to sell the unit and vacate it, stating the accommodation of this unit owner had led to “undue hardship” for the other owners for five years. It was a real challenge for a court trying to weigh conflicting and sympathetic interests.
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In another recent case, “I Inc.” agreed to lend mortgage funds to “C Ltd”. I Inc.’s commitment letter allowed the setting of the mortgage rate in advance of closing, with a cut-off date. C Ltd. chose May 19 to close and rate was set at 4.08 per cent.
However, by that date, C Ltd. was not in a position to clear an existing mortgage and liens, so I Inc. extended the closing date to May 23 at the same 4.08 per cent rate.
When it became apparent C Ltd. still could not satisfy its obligations by May 23, I Inc. insisted on a higher rate. C Ltd. chose to refuse to close after May 23 at the higher rate and I Inc. retained the $125,000 deposit as liquidated damages.
When C Ltd. sued, the court held there was no “promissory estoppel” or waiver of time of the essence by I Inc. that initially extended the closing by seven days at the same rate. When C Ltd. still could not close on time, I Inc. was entitled to rely on the commitment, which set out the mechanism to determine a higher rate.
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In a case in B.C., a property was sold with the intention of it being developed, by being subdivided into five lots. The vendor was to retain one lot, and the purchaser was to provide a subdivision plan by the closing date.
The subdivision plan was turned down because the lot to be retained by vendor had to be remediated, at the expense of both vendor and purchaser.
The vendor and the purchaser both breached the contract. The vendor did not advise the purchaser of the need to remediate the one lot, and the purchaser did not provide the subdivision plan by the closing date.
The trial judge ruled that the vendor must transfer the property but an appeal court overturned the trial judge, since the purchaser was not ready and willing to complete the purchase. It ruled that the subdivision plan could not be obtained by purchaser for “many” reasons and therefore specific performance sought by the purchaser was dismissed. Two wrongs do not make a right.
Donald H. Lapowich, Q.C. Hon. FRGD is a partner at the law firm of Koskie, Minsky LLP in Toronto, where he practices civil litigation with a particular emphasis on real estate litigation. He acts for professionals including lawyers, real estate agents, insurance brokers/agents and dentists.
