Brian Madigan LL.B., Broker
BRMadigan@Rogers.com

RE/MAX West Realty Inc.,
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Independently owned and operated

96 Rexdale Blvd. 
Toronto, Ontario 


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Uniqueness of a Property Qualifying for the Equitable Remedy of Specific Performance”

August 21, 2018 - Updated: August 21, 2018

Uniqueness of a Property Qualifying for the Equitable Remedy of Specific Performance”
 

The leading case on Specific Performance is Semelhago v. Paramadevan, [1996] 2 SCR 415.
 

A property needed to be unique in order for it to qualify.
 

Here’s what Mr. Justice Sopinka said:
 

“14               Different considerations apply where the thing which is to be purchased is unique. 
 

Although some chattels such as rare paintings fall into this category, the concept of uniqueness has traditionally been peculiarly applicable to agreements for the purchase of real estate. 
 

Under the common law every piece of real estate was generally considered to be unique.  Blackacre had no readily available equivalent. 
 

Accordingly, damages were an inadequate remedy and the innocent purchaser was generally entitled to specific performance.  Given the flexibility of the rule at common law as to the date for the assessment of damages, it would not be appropriate to insist on applying the date of breach as the assessment date when the purchaser of a unique asset has a legitimate claim to specific performance and elects to take damages instead (see Wroth v. TylerJohnson v. Agnew; and Mavretic v. Bowman, [1993] 4 W.W.R. 329.  
 

The rationale that the innocent purchaser is fully compensated, if provided with the amount of money that would purchase an asset of the same value on the date of the breach, no longer applies. 
 

This disposition would not be a substitute for an order of specific performance. 
 

The order for specific performance may issue many months or even years after the breach.  The value of the asset may have changed. 
 

 

15               Moreover, the claim for specific performance revives the contract to the extent that the defendant who has failed to perform can avoid a breach if at any time up to the date of judgment, performance is tendered. In cases such as the one at bar, where the vendor reneges in anticipation of performance, the innocent party has two options:
 

  1. He or she may accept the repudiation and treat the agreement as being at an end.  In that event, both parties are relieved from performing any outstanding obligations and the injured party may commence an action for damages. 

 

 

  1. Alternatively, the injured party may decline to accept the repudiation and continue to insist on performance.  In that case, the contract continues in force and neither party is relieved of their obligations under the agreement.  As is elaborated in McGregor on Damages (13th ed. 1972), at p. 149:

 

Where a party to a contract repudiates it, the other party has an option to accept or not to accept the repudiation. 

 

If he does not accept it there is still no breach of contract, and the contract subsists for the benefit of both parties and no need to mitigate arises. 

 

On the other hand, if the repudiation is accepted this results in an anticipatory breach of contract in respect of which suit can be brought at once for damages . . . .

 

Thus, the claim for specific performance can be seen as reviving the contract to the extent that the defendant who has failed to perform can avoid a breach if, at any time up to the date of judgment, performance is tendered. 
 

In this way, a claim for specific performance has the effect of postponing the date of breach.
 

 

16               For all of these reasons, it is not inconsistent with the rules of the common law to assess damages as of the date of trial.”
 

Sopinka J. also referred to the Chaulk case with approval:
 

“In Chaulk v. Fairview Construction Ltd. (1977), 14 Nfld. & P.E.I.R. 13, the Newfoundland Court of Appeal (perGushue J.A.), after quoting the above passage from Adderley v. Dixon, stated, at p. 21:
 

The question here is whether damages would have afforded Chaulk an adequate remedy, and I have no doubt that they could, and would, have. 
 

There was nothing whatever unique or irreplaceable about the houses and lots bargained for. 
 

They were merely subdivision lots with houses, all of the same general design, built on them, which the respondent was purchasing for investment or re-sale purposes only. 
 

He had sold the first two almost immediately at a profit, and intended to do the same with the remainder. 
 

It would be quite different if we were dealing with a house or houses which were of a particular architectural design, or were situated in a particularly desirable location, but this was certainly not the case. 
 

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.”
 

COMMENT
 

There are some important considerations here. The Supreme Court of Canada dealt with the law but on the facts, the impression was that the particular property was not unique. They agreed with the Trial Judge in that regard.
 

However, the litigation had proceeded “as if” the property qualified for specific performance, so the Court let it go at that.
 

          Corbett J. at trial said:
 

                   “First of all, the subject property was not unique. 
 

It was a building lot under construction which would be interchangeable in all likelihood with any number of others.” 
 

So, this particular case cannot stand for its own facts to detail “uniqueness”. That was simply a legal recognition in that individual lawsuit.
 

Aside from that:
 

It is unique if:
 

  • particular architectural design,
  • situated in a particularly desirable location.
     

It is not unique if:
 

  • building lot under construction, interchangeable with others,
  • merely subdivision lots with houses, all of the same general design,
  • nothing whatever unique or irreplaceable about the houses and lots.
     

As we go forward, the Supreme Court of Canada while expressing the context of the law as related to specific performance has left the application of a varying set of facts to the numerous cases which were to follow.
 

Brian Madigan LL.B., Broker

www.iSourceRealEstate.com


Tagged with: specific performance semelhago uniqueness supreme court of canada ontario law
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Brian Madigan LL.B. Broker

RE/MAX West Realty Inc. Brokerage

Independently owned and operated

96 Rexdale Blvd. , Toronto Ontario,

Phone: 416-745-2300

BRMadigan@Rogers.com

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