In the past, I have published a number of posts commenting on
the difficulty in obtaining specific performance in the case of a
developer attempting to complete a commercial transaction with an
Plaintiffs seeking such relief typically register and attempt to
maintain certificates of pending litigation on the properties in
question so that they are secured in the event that specific
performance is ultimately ordered. In order to do so, it is
accepted jurisprudence that the purchaser must satisfy the court
that the property is unique. Unfortunately, that has proven to be a
difficult task in the context of commercial acquisitions.
In this case, Northfield owned a parcel of vacant land at the
intersection of two regional roads in Waterloo, Ontario. North
American, an experienced developer, entered into an agreement with
Northfield to purchase the land for development as a shopping
centre. The agreement was conditional on North American obtaining
the necessary rezoning and other municipal approvals.
Over the course of the next few years, North American spent over
$500,000 in fees, costs and expenses and ultimately succeeded in
obtaining rezoning. During that time, it became apparent that the
value of the property had increased substantially, both as a result
of the investment by North American in obtaining the rezoning and
simply as a result of normal increases in real estate values over
When the closing date approached, Northfield refused to close.
Litigation ensued. In the course of the litigation, North American
registered a certificate of pending litigation on the title to the
property to prevent Northfield from selling it to anyone else.
Northfield brought a motion to remove the certificate on the
grounds that, among other things, the land was in no way unique and
if the court ultimately ruled in North American's favour at
trial, damages would be an adequate remedy.
In support of its position of the motion to remove the
certificate, Northfield referred to a variety of cases in which the
court had made it clear that where land is purchased for
investment, the land will not be considered unique and the
certificate will not be allowed to stand.
In this case, however, the court took a different approach. The
court observed that according to the City of Waterloo Planning
Department's own file, the intersection was considered an
important intersection in the City. North American had invested a
great deal of time and money in the development, arranging for it
to be rezoned and thereby giving it a very different character and
value than had been the case at the time that the Agreement of
Purchase and Sale was signed. Perhaps most importantly, the court
accepted that North American's intention was to build a
shopping centre and then retain it on a long-term basis. In other
words, this was not a situation in which the property was to be
treated as some type of inventory to be sold at the next opportune
moment. Nor was it to be looked at merely as an investment in the
sense of an acquisition strictly for the purpose of profiting from
its anticipated income stream.
In the result, the court was satisfied that even though this was
a commercial transaction, the property could be considered unique.
The certificate was allowed to stand.
In my view, this was an eminently sensible solution. As has
already been observed in earlier cases, uniqueness in this context
is not synonymous with singularity. The property does not have to
be a one-of-a-kind property in order to be considered unique.
Uniqueness can also be measured by factors such as the precise
location of the lands, the pre-closing investment made in the
property by the prospective purchaser, and the purchaser's
intentions following acquisition.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Russell v. Township of Georgian Bay provides a useful reminder of the fact that while municipal officials sometimes appear to hold all of the cards in disputes with home owners, that is not always the case.
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