Canada: Agricultural Law Netletter - Thursday, September 21, 2017

Issue 380

Issues added on the 7th and 21st of every month.

HIGHLIGHTS

A Justice of the Saskatchewan Court of Queen's Bench has directed specific performance of an agreement involving the sale of Saskatchewan farm land by requiring that the vendor sell three quarter sections to the purchaser. The Court comments on the decision of the Supreme Court of Canada in Semelhago v Paramadevan which held that specific performance with respect to an agreement for the sale of land should not be granted as a matter of course absent evidence that land is unique to the extent that its substitute would not be readily available, and several Saskatchewan Court of Appeal decisions which consider and interpret this case in relation to Saskatchewan farm land. The Court granted specific performance based on evidence that the three quarter sections owned by the vendor would yield economies of scale in terms of time and cost to the purchaser, which are both critical elements in farming operations. (Bublish v. Turanich, CALN/2017-056, [2017] S.J. No. 359, Saskatchewan Court of Queen's Bench)

NEW CASE LAW

Bublish v. Turanich;

CALN/2017-056,

Full text: [2017] S.J. No. 359;

2017 SKQB 240,

Saskatchewan Court of Queen's Bench,

R.S. Smith J.,

August 17, 2017.

Specific Performance -- Saskatchewan Farm Land.

A Saskatchewan farmer, Dwayne Bublish ("Bublish") sued another Saskatchewan farmer, Nicholas Turanich ("Turanich") for specific performance of an alleged agreement which would have required Turanich to sell Bublish three quarter sections of Saskatchewan farm land for $210,000.00.

The first issue in the lawsuit was whether there was an enforceable contract between Turanich and Bublish. The second issue was whether Bublish was entitled to specific performance, or whether his only remedy was damages for breach of contract.

Decision: Smith, J concluded [at para. 72] that the parties had reached an enforceable agreement and [at para. 76] granted specific performance was granted.

The primary legal issue was whether specific performance should be granted.

Smith, J referred to the leading decision of Semelhago v Paramadevan, [1996] S.C.J. No. 71 (SCC), [1996] 2 SCR 415, which was quoted at length in SaskEnergy Inc. v ADAG Corporation Canada Ltd., [2015] S.J. No. 261, 2015 SKQB 143, 475 Sask R 65. In Semelhago, Sopinka J, speaking for the court, stated, among other things:

22 ...Specific performance should, therefore, not be granted as a matter of course absent evidence that the property is unique to the extent that its substitute would not be readily available...

Smith, J then referred to the decision of the Saskatchewan Court of Appeal in Raymond v Raymond Estate, [2011] S.J. No. 313, 2011 SKCA 58, 371 Sask R 260 at para. 163, in which Caldwell, JA observed, among other things, with respect to specific performance in relation to Saskatchewan farm land:

14 Semelhago does not, however, stand for the proposition that the presumption of uniqueness has been supplanted by a presumption of replaceability...The only change wrought by Semelhago is in the approach of the courts to determining the appropriate remedy; judges must no longer presume the inadequacy of damages as a remedy whenever real property is involved. But, this assessment is not a search for uniqueness. Rather, it is appropriate to characterize a judge's assessment in cases of this nature as an inquiry into whether, in the circumstances, damages would be an inadequate remedy...

Smith, J also referred to the decision of the Saskatchewan Court of Appeal in 101090442 Saskatchewan Ltd. v Harle, [2014] S.J. No. 13, 2014 SKCA 6, 433 Sask R 62, in which

Jackson, J criticized a trial judgment, stating as follows:

81 In my respectful opinion, several difficulties arise with these reasons . First, the trial judge viewed "uniqueness" and the "adequacy of damages" as distinct questions, each to be answered independently of the other. Indeed, he considered whether the property is unique before considering whether damages would be adequate remedy. As such, he has not given effect to the change of law brought about by Semelhago v. Paramadevan, [1996] S.C.J. No. 71 (SCC), [1996] 2 S.C.R. 415.

Smith, J observed [at para. 68] that there was no evidence with respect to whether or not there were other quarter sections available for purchase which would be equally beneficial to the plaintiff, however the plaintiff did give evidence explaining the many advantages to having the three quarter sections in question incorporated with his quarter section in the same area. Smith, J concluded, at para. 70 and 71 that specific performance was the only appropriate remedy, stating:

  1. The evidence is compelling that the Lands are attractive to the plaintiff because they are contiguous to a quarter section he owns which presently stands alone in township 28. The acquisition of the Lands would give him a section to farm all within easy working distance. Contiguous properties yield economies of scale in terms of time and cost, both critical elements in farming operations.
  1. I would not presume that the fact that the Lands are contiguous to the quarter section owned by the plaintiff is, ipso facto, proof that damages alone would be inadequate. However, the evidence in this case unfolded in such a way as to convince me that the plaintiff has discharged his burden of proving that an order of specific performance is the only appropriate remedy.

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