610990 Ontario Inc. v. Business Development Canada

610990 Ontario Inc. v. Business Development Canada Collection Decisions of the Court of Appeal Date 1999-07-23 Docket numbers C30233 Judges Abella, Rosalie Silberman; Laskin, John Ivan; MacPherson, James C. Subject Civil Decision Content DATE: 19990723 DOCKET: C30233 COURT OF APPEAL FOR ONTARIO RE: 610990 ONTARIO INC., WILLIAM HUTCHINSON (Appellants) v. BUSINESS DEVELOPMENT BANK OF CANADA (Respondent) BEFORE: ABELLA, LASKIN and MacPHERSON JJ.A. COUNSEL: William Hutchinson appearing in person Ross F. Earnshaw for the respondent HEARD: July 19, 1999 ENDORSEMENT [1] The issue in this appeal is whether or not a sale by the Business Development Bank of Canada was an improvident one and, if so, the measure of damages including mental distress and anguish caused to William Hutchinson, the appellant. [2] At the heart of this appeal is the submission of the appellant that the property was advertised with an incorrect zoning designation, resulting in a less favourable sale price than would otherwise have been possible. [3] The Business Development Bank was the mortgagee in possession of the property from September 26, 1995 until the sale date of the property, May 30, 1997. During that time, prior to sale of the property, the Business Development Bank obtained two appraisals, one by J.D. Brighton Appraisals Limited for $384,000.00, and the second by Appraisers Network Inc. for $480,000.00. The lower appraisal had the correct zoning designation. As a result of receiving these appraisals, the bank entered into an MLS listing in October 1995 whereby the property was listed for $484,900.00. [4] There were no offers up to June 1996, during which time the listing price was reduced eventually to $409,900.00. Having received no offers, the bank then decided to sell the property by public auction, but since the only offer to purchase was in the amount of $100,000.00 that offer was rejected. [5] The property was relisted in September 1996 with a listing price of $389,900.00. By the time that listing expired in January 1997 no offer had been received. The listing was accordingly extended to April 10, 1997. In March 1997, an offer was received from a purchaser for $250,000.00. Because the bank considered this amount unacceptable, negotiations took place with the bank ultimately accepting an offer for $275,000.00. Prior to the closing of the transaction on May 30, 1997, the bank was required to pay tax and hydro arrears in the amount of $61,486.26. [6] There was no evidence put forward by the appellant as to what the fair market value of the property was in 1997 when it was sold. Nor was there any evidence before the court that the price received would have been different had the zoning designation on the listing been accurate. [7] While it is true that there was a brief reference in the record to the possibility of some change in the market value resulting from incorrect zoning information, and while Mr. Hutchinson in his argument made reference to the error in the listing agreement, there was no reliable evidentiary foundation for the trial judge to conclude that the sale was improvident as a result of this error. Indeed, in his evidence at trial, Mr. Hutchinson did not claim that the sale price obtained by the Bank was caused by incorrect zoning information. It is worth noting that the appraisal which correctly identified the zoning was almost $100,000.00 lower than the appraisal which incorrectly referred to the zoning. [8] We see no basis for interfering with the trial judge’s conclusion that the bank took every reasonable step to realize a fair price for this property, and therefore would not interfere with his conclusion that there was no liability on the part of the bank to Mr. Hutchinson. [9] Accordingly, the appeal is dismissed with costs. “R.S. Abella J.A.” “John Laskin J.A.” “J.C. MacPherson J.A.”