This recent case deals with the problem when the seller of real estate refuses to close: namely, what remedy will be given by the courts. The penultimate question typically comes down to whether the court will order the sale of the property to proceed in accordance with the contract (known as “specific performance”), or whether the court will simply award damages to the Purchaser in relation to losses surrounding the aborted sale.
In this case, specific performance was ordered, and here is what this case reminds us about:
- specific performance should not be granted unless the property under question is unique;
- “unique” in the context of the specific performance remedy does not literally mean ‘one of a kind.” To be unique, the property simply has to have a quality (or qualities) that makes it especially suitable for the proposed use that cannot be reasonably duplicated elsewhere. To put this another way, the plaintiff must show that the property has distinctive features that make an award of damages inadequate. The plaintiff need not show that the property is incomparable;
- when assessing uniqueness, the court will consider the purchaser’s “wish list”, the market conditions, the location, the type of home, the condition of the home, the lot, the finished areas of the home, the quality of finishes, the availability of comparable homes with similar attributes in the same price range and financing terms, and the proximity to certain amenities; and
- the price and financing terms would, for example, be a significant issue if the housing market was in a volatile state, with significant inflation or rising financing costs.
The case is also an interesting read as it addresses the failed defences raised by the Seller, including the rejected argument that the Seller failed to mitigate their damages, and that the Seller had access to other comparable houses.
Warner v Ahmadi, 2022 ONSC 2679
https://www.canlii.org/en/on/onsc/doc/2022/2022onsc2679/2022onsc2679.html