Fairness and equitable concerns of the court: The owner of two condominium units failed to pay common expenses since the inception date of the registration of the condominiums. The condominium corporation did not register a lien for the common expense payments that were in default until late in the year 2012. In the meantime, a bank that held the mortgage against the condominium units determined they were in default and the units were subject to power of sale.

It was only at that point that the condominium corporation sought an order to lien the owner to pay all arrears since January 2009 and claim priority over the bank. The sale price of the two units would not be sufficient to pay the entire mortgage debt.

The court, using fairness and equity, determined that any right of the condominium corporation to seek a lien for the arrears prior to late 2012 “had expired” and as far as priority was concerned, the equities lay with the bank. By not complying with the condominium statute requiring lien rights to be registered, prejudice would accrue to the bank by reviving lien rights that the condominium corporation had allowed to expire. (Toronto Standard Condominium Corporation No. 1908 v. Stefco, 2013 ONSC 7709)

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Convenient jurisdiction: In a recent Ontario Court of Appeal case, an individual was sued in North Carolina and hired a North Carolina law firm. The defence was unsuccessful. The party then sued in Ontario alleging negligence against the North Carolina firm of lawyers. On bringing the action in Ontario, the claimant admitted that there was no real and substantial connection to Ontario but argued that the Ontario Court could exercise a discretion and assume jurisdiction based on common law forum of necessity.

The Ontario Court of Appeal held that the complainant failed to satisfy a very high onus required to prove that the forum of necessity doctrine applied. In other words, the complainant had not established that there was no other forum in which it could reasonably seek relief. This is a stringent requirement and is only applied (forum of necessity) in “exceptional cases”. (West Van Inc. v. Daisley, 2014 ONCA 232)

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Make sure you are ready when trying to enforce a contract: The defendants agreed to sell a property to the plaintiffs and the closing date was extended a number of times. The parties attempted to close on a certain date and the plaintiff complained that it did not have certain documents from the defendants. The defendants said they were not obliged to deliver those documents.

As was inevitable, the plaintiffs brought a motion for specific performance and summary judgment. The defendants were unsuccessful both on the original hearing and the appeal.

Even assuming that the defendants’ version was correct, the judge found that “time was of the essence” but that clause had been waived. The defendants could not rely on that clause “as they were not ready to close on the specified date.” Therefore, the only conclusion was that the defendants, in order to reinstate the time of the essence clause, would have had to give the plaintiffs reasonable notice of a new closing date and state that time was of the essence in order to set up the new date for the closing. (2329131 Ontario Inc. v. Carlyle Development Corp., 2014 ONCA 132) 

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Registration of professionals: The plaintiff, a mortgage agent, knew the defendants socially by reason of a prior business relationship. The mortgage agent introduced the defendants to the buyer of the defendants’ home. The mortgage agent then claimed $21,000 for that introduction and went to court to collect it.

The court easily dismissed that claim because the agent was not registered under Ontario’s Real Estate and Brokers Business Act, which prohibited the arrangement on which the plaintiff based her claim.

Full case summaries at www.canlii.org.

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.