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SALE OF LAND - Agreement of purchase and sale - Offer - Specification of time and manner of acceptance - Validity

Thursday, August 03, 2017 @ 8:35 AM  

Lexis Advance® Quicklaw®
Appeal by the plaintiff purchasers from dismissal of their action against the defendant vendors seeking specific performance of an agreement of purchase and sale. In August 2013, the purchasers signed a draft agreement of purchase and sale and provided a deposit cheque to the vendors' real estate agent. The agent advised that certified funds were required. The parties finalized the agreement of purchase and sale, which required payment of the deposit within 24 hours. The agreement included a “time shall be of the essence” clause. The purchasers delivered the deposit in the form of a bank draft approximately 25 hours after the 24-hour deadline. The realtor provided a receipt for the deposit. Two months later, six days prior to closing, counsel for the vendors wrote the purchasers advising that the agreement of purchase and sale was invalid due to the late receipt of the deposit. The purchasers brought a motion for determination of a question of law. The motion judge found that the late delivery of the deposit precluded the existence of an agreement of purchase and sale capable of specific performance. The judge dismissed the purchasers' underlying action. The purchasers appealed.

HELD: Appeal allowed. The motion judge drew an impermissible inference that the purchasers' personal cheque would not have been honoured by the bank. Although authenticated bank statements showed that the purchasers' chequing account did not contain a sufficient balance at the time it was drawn, there was no evidence regarding the purchasers' overall financial capacity, or their arrangements with the bank. There was evidence that within two days, the purchasers provided a bank draft in the requested amount. There was no adequate evidentiary basis to address the issues of part performance, waiver, estoppel or the application of the “entire agreement” provision. The determination that the purchasers failed to pay the requisite deposit on a timely basis was made in error. The purchasers' action was restored to the trial list.

Preiano v. Cirillo, [2017] O.J. No. 3844, Ontario Court of Appeal, R.J. Sharpe, P.D. Lauwers and L.B. Roberts JJ.A., July 24, 2017. TLD-July312017007