Southcott Estates Inc. v. Toronto Catholic District School Board, ONSC

Southcott Estates Inc. v. Toronto Catholic District School Board, 2009 CanLII 3567

Ontario Superior Court of Justice
January 30, 2009

The Toronto Catholic District School Board entered into an agreement of purchase and sale with Southcott Estates Inc. for the sale of 4.78 acres of surplus land to Southcott for approximately $3.4 million. Southcott was a single purpose company with no assets except for the deposit it paid. It is a wholly owned subsidiary of Ballantry Homes Inc.

Southcott intended to use the land for residential development. The agreement was conditional upon the TCDSB obtaining a severance from the Committee of Adjustments on or before the closing date. The original closing date was extended as there was insufficient time to obtain the severance. The TCDSB offered to extend the closing date to a fixed number of days after the severance was obtained, but Southcott requested a closing date of January 31, 2005 and the parties agreed to so extend. The severance application on December 16, 2004 was deferred as premature at the municipality’s request because it was not accompanied by a development plan and as such the transaction could not close by January 31, 2005. Southcott sought to extend the closing date but the TCDSB refused the request and declared the transaction to be at an end. Mr. Davis and Ms. Preston, on behalf of the Plaintiff Southcott, asserted in the action that the TCDSB breached its obligation to use its best efforts to obtain the severance and brought an action for specific performance or in the alternative, for damages.

Southcott succeeded at trial in its claim for damages ($1.935M) arising from TCDSB’s failure to honour its agreement of purchase and sale.