Here’s a summary of the decision in Taheripouresfahani v. Dormer Bond Inc.:
Background
Plaintiffs, Mohammadali Taheripouresfahani and Mahnaz Dehghani Sanij, sought summary judgment to recover their deposit, damages, and punitive damages after a dispute over an Agreement of Purchase and Sale (APS) with Dormer Bond Inc. (the Vendor).
Dormer Bond cross-moved for summary judgment for possession of the property and retention of deposits, alleging the Plaintiffs breached the APS.
Both parties agreed no trial was necessary; the issue was whether the APS was breached and by whom.
Agreement of Purchase and Sale
Signed March 1, 2020, for 7 Phelps Lane, Unit 3, Richmond Hill, for $761,490.
Plaintiffs paid deposits totaling $114,224.50 and $11,540.69 for upgrades.
Closing was to be set by the Vendor’s solicitor; “time was of the essence.”
Plaintiffs took early occupancy in April 2023, paying monthly occupancy fees of $3,782.
Statement of Adjustments Dispute
Dormer Bond issued a Statement of Adjustments (SOA) on September 7, 2023, adding nearly $60,000 in extra charges:
Development Charges: $9,040 (HST included)
Meters (Hydro/Gas): $9,224.45
Vendor’s Legal/Admin Fees: $9,723.65
Alternative Materials Cost: $30,533.82
Plaintiffs objected, claiming these charges were unauthorized and refused to close until they were removed or clarified.
Multiple exchanges between lawyers occurred between September 15–25, 2023, with Dormer Bond refusing to fully remove or justify the charges.
Analysis of SOA Charges
Development Charges: Authorized by APS, but Vendor did not prove the calculation was accurate.
Meters: Authorized, but no supporting documentation was provided.
Vendor’s Legal/Admin Fees: Not authorized; improperly included.
Alternative Materials Cost: Authorized under a separate occupancy acknowledgment, but Vendor provided no certificate confirming the amount.
Total unauthorized or unsupported charges: $48,797 (Development, Meters, Alternative Materials).
Unauthorized legal/admin fees: $9,723.65.
Breach and Termination
Key Finding: Dormer Bond attempted to increase the purchase price through unauthorized charges, constituting an anticipatory breach of contract.
Plaintiffs were entitled to treat the APS as terminated when Dormer Bond refused to close at the agreed price:
Critical dates: September 15, 18, or 19, 2023 – Plaintiffs rejected increased charges.
Dormer Bond’s later offers to reduce charges were still inconsistent with APS and required a mutual release, which APS did not require.
Plaintiffs’ Claims for Damages
General damages: Alleged unauthorized entry, moving costs, utilities, home insurance, market appreciation loss – all denied.
Vendor had a contractual right to access the Unit (subsection 9(a) of APS).
Plaintiffs failed to provide sufficient evidence or legal basis.
Punitive damages: Denied. Vendor’s conduct was not malicious, oppressive, or high-handed.
Dormer Bond’s Claims
Plaintiffs occupied Unit past September 2023 without ownership or paying fees.
Vendor entitled to possession and damages:
Occupancy fees from May 1, 2024: $68,076
Condominium fees: $3,882
Property taxes: $6,586.56
Summary of Orders
Plaintiffs: Return of deposit $114,224.50 + $11,540.69 (upgrades) with interest.
Defendant:
Possession of the Unit (Writ of Possession granted).
Damages for occupancy, condo fees, and property taxes as above.
Other claims (general, punitive, balance of motions) dismissed.
Costs
Divided; submissions to be exchanged within specified timelines.
In short:
Plaintiffs recover their deposit because Dormer Bond breached the APS by demanding unauthorized charges.
Dormer Bond gains possession of the Unit and is entitled to occupancy fees, property taxes, and condo fees because Plaintiffs overstayed without legal title or payments.
All other damage claims and punitive damages by Plaintiffs were denied.
COMMENT
It is most unfortunate that some Builders seek “extras” when it comes to the money. Since Tarion is involved, it would be a good idea if all the extras have to be approved by Tarion. Here, of course, the Builder was likely able to “bully” other Buyers into paying their outrageous additional claims.
Brian Madigan LL.B., Broker
www.OntarioRealEstateSource.com