Neher v. Marathon Homes Inc., (2011) 509 A.R. 295 (QB)

• Judge: Manderscheid, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: December 06, 2010
• Citations: (2011), 509 A.R. 295 (QB);2011 ABQB 92

Neher v. Marathon Homes Inc. (2011), 509 A.R. 295 (QB)

MLB headnote and full text

Temp. Cite: [2011] A.R. TBEd. FE.129

Sharon Neher and Jade Neher (plaintiffs/defendants by counterclaim) v. Marathon Homes Inc. (defendant/plaintiff by counterclaim)

(0703 06882; 2011 ABQB 92)

Indexed As: Neher v. Marathon Homes Inc.

Alberta Court of Queen's Bench

Judicial District of Edmonton

Manderscheid, J.

February 17, 2011.

Summary:

The defendant agreed to construct a home and sell it to the plaintiffs. Construction began, but the defendant suddenly terminated the purchase agreement, claiming that the plaintiffs missed an installment under the original draw schedule in the agreement. The plaintiffs sued for damages in lieu of specific performance, claiming that the parties had agreed to a revised draw schedule. The defendant denied an agreement and, alternatively, raised the Statute of Frauds. The defendant counterclaimed for damages arising from the plaintiffs' filing of a caveat and certificate of lis pendens.

The Alberta Court of Queen's Bench held that the defendant illegally terminated the purchase agreement and, therefore, was in breach of the agreement. The court allowed the plaintiffs' action and assessed damages accordingly. The counterclaim was dismissed.

Contracts - Topic 7952

Statute of frauds - General - When applicable - The defendant agreed to construct a home and sell it to the plaintiffs - Construction began, but the defendant suddenly terminated the purchase agreement, claiming that the plaintiffs missed an installment under the original draw schedule in the agreement - The plaintiffs sued, claiming that the parties had agreed to a revised draw schedule - The defendant denied an agreement and, alternatively, raised the Statute of Frauds - The Alberta Court of Queen's Bench found that the parties had agreed to amend the draw schedule - Such a change to the purchase agreement, being a non-essential term, was not caught by the Statute of Frauds - There was no breach of the revised draw schedule and, therefore, the plaintiffs neither repudiated nor breached the purchase agreement - Thus by "terminating", the defendant breached the agreement - The court opined that, in any event, notice of default of the installments was an implied term of the purchase agreement - The plaintiffs were entitled to damages - See paragraphs 7 to 33.

Damages - Topic 1305

Exemplary or punitive damages - Breach of contract - [See Sale of Land - Topic 8755 ].

Sale of Land - Topic 1326

The contract - Necessity for writing - General - Statute of Frauds - Circumstances not within statute - [See Contracts - Topic 7952 ].

Sale of Land - Topic 1327

The contract - Necessity for writing - Statute of Frauds - Oral variation of writing - [See Contracts - Topic 7952 ].

Sale of Land - Topic 1830

The contract - Implied terms - Respecting payment - [See Contracts - Topic 7952 ].

Sale of Land - Topic 1965

The contract - Breach of contract - What constitutes - [See Contracts - Topic 7952 ].

Sale of Land - Topic 8755

Remedies of purchaser - Damages - In lieu of specific performance - The defendant agreed to construct a home and sell it to the plaintiffs - Construction began, but the defendant suddenly terminated the purchase agreement, claiming that the plaintiffs missed an installment - The house was completed, but it was not the exact house specified in the agreement - The plaintiffs sued for damages in lieu of specific performance, claiming that the defendant illegally terminated the agreement - The plaintiffs also claimed punitive damages, claiming that the defendant acted in a high-handed manner in an attempt to profit from a rising real estate market - The Alberta Court of Queen's Bench allowed the action - The court held that damages should be calculated as of the date of the breach (i.e., the difference between the sale price and the value at the time of the breach) - The court held that this was not an appropriate case for punitive damages - Although the defendant's conduct was not business-like, it could not be characterized as malicious and outrageous - See paragraphs 50 to 83.

Sale of Land - Topic 8763

Remedies of purchaser - Damages - Time for assessment of - [See Sale of Land - Topic 8755 ].

Sale of Land - Topic 8774

Remedies of purchaser - Damages - Measure of - [See Sale of Land - Topic 8755 ].

Cases Noticed:

F.H. v. McDougall, [2008] 3 S.C.R. 41; 380 N.R. 82; 260 B.C.A.C. 74; 439 W.A.C. 74, refd to. [para. 6].

Ghitter (Ron) Property Consultants Ltd. v. Beaver Lumber Co. (2003), 330 A.R. 353; 299 W.A.C. 353; 2003 ABCA 221, refd to. [para. 11].

Saint John Tugboat Co. v. Irving Refinery Ltd., [1964] S.C.R. 614, refd to. [para. 11].

Triple R Contracting Ltd. v. 384848 Alberta Ltd. et al. (2001), 282 A.R. 1; 2001 ABQB 52, refd to. [para. 29].

Stochinsky v. Chetner et al. (2003), 330 A.R. 309; 299 W.A.C. 309; 2003 ABCA 226, refd to. [para. 32].

Ventas Inc. et al. v. Sunrise Senior Living Real Estate Investment Trust et al. (2007), 222 O.A.C. 102; 85 O.R.(3d) 254; 2007 ONCA 205, refd to. [para. 41].

Royal West Homes Inc. v. Webster, [2010] A.R. Uned. 515; 30 Alta. L.R.(5th) 1; 2010 ABQB 446, dist. [para. 55].

Wertheim v. Chicoutimi Pulp Co., [1911] A.C. 301 (H.L.), refd to. [para. 56].

Fidler v. Sun Life Assurance Co. of Canada, [2006] 2 S.C.R. 3; 350 N.R. 40; 227 B.C.A.C. 39; 374 W.A.C. 39; 2006 SCC 30, refd to. [para. 56].

Semelhago v. Paramadevan, [1996] 2 S.C.R. 415; 197 N.R. 379; 91 O.A.C. 379, refd to. [para. 57].

Dodge (John E.) Holdings Ltd. v. 805062 Ontario Ltd. (2003), 168 O.A.C. 252; 63 O.R.(3d) 304 (C.A.), leave to appeal refused (2003), 326 N.R. 195; 194 O.A.C. 197 (S.C.C.), refd to. [para. 59].

Alberta New Home Warranty Program v. Glenwood Homes Inc. et al. (2009), 467 A.R. 330; 2009 ABQB 363, refd to. [para. 59].

Electrohome Ltd. v. Gregg Properties (2002), 11 R.P.R.(4th) 270; 2002 ABQB 1001, refd to. [para. 61].

Ansdell v. Crowther (1984), 11 D.L.R.(4th) 614; 55 B.C.L.R. 216 (C.A.), refd to. [para. 65].

Pepper v. Lecoure (1990), 11 R.P.R.(2d) 235; 20 A.C.W.S.(3d) 1015 (Ont. Dist. Ct.), refd to. [para. 65].

Naylor Group Inc. v. Ellis-Don Construction Ltd., [2001] 2 S.C.R. 943; 277 N.R. 1; 153 O.A.C. 341; 2001 SCC 58, refd to. [para. 68].

Keays v. Honda Canada Inc., [2008] 2 S.C.R. 362; 376 N.R. 196; 239 O.A.C. 299; 2008 SCC 39, refd to. [para. 82].

Sherstenko v. Sherstenko, [2006] A.R. Uned. 455; 25 E.T.R.(3d) 233; 2006 ABQB 481, refd to. [para. 85].

Counsel:

Scott Hammel and Paul Ryzuk (Miller Thomson LLP), for the plaintiffs;

Vance Siakaluk (Oshry & Company), for the defendant.

This case was heard in Edmonton, Alberta, on December 6, 2010, before Manderscheid, J., of the Alberta Court of Queen's Bench, who delivered the following decision on February 17, 2011.