Lee v. 1435375 Ontario Ltd.

Lee v. 1435375 Ontario Ltd.

Appeal allowed: there was no common mistake as to a technical "permitted use" because parties did not share that technical assumption; the Purchaser bore the onus to prove the premises could not lawfully continue as a dry cleaning business and had assumed the zoning risk by not conditioning the agreement; equitable mistake relief was unavailable because the Purchaser was at fault; accordingly the motion judge erred in ordering rescission.

Citation
2013 ONCA 516
Parties
Plaintiff (respondent): Chang Yong Lee; Defendant (appellant): 1435375 Ontario Ltd.
Court
Court of Appeal for Ontario
Jurisdiction
Canada
Judgment Date
15 August 2013
Procedural Posture
Civil Appeal (contract/rescission) / Court of Appeal Decision on Appeal From Superior Court Motion/summary Judgment
Outcome
Appeal allowed; motion for summary judgment dismissed
Legal Topics
Common Mistake, Equitable Mistake, Rescission, Legal Non Conforming Use, Caveat Emptor, Summary Judgment
Source Language
English
Contract Law Property Law Administrative Law (zoning) Equity Common Mistake Equitable Mistake Rescission Legal Non Conforming Use +2 more

Case Brief

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Parties

Chang Yong Lee

Plaintiff (respondent)

1435375 Ontario Ltd.

Defendant (appellant)

Procedural Posture

Civil Appeal (contract/rescission) / Court of Appeal Decision on Appeal From Superior Court Motion/summary Judgment

Legal Issues

  1. 1 Whether the parties were subject to a common mistake as to the zoning status (technical "permitted use") of the premises
  2. 2 Which party bore the onus to prove that ongoing use was impossible or permissible (onus of proof)
  3. 3 Whether equitable mistake relief applies

Ratio Decidendi

Appeal allowed: there was no common mistake as to a technical "permitted use" because parties did not share that technical assumption; the Purchaser bore the onus to prove the premises could not lawfully continue as a dry cleaning business and had assumed the zoning risk by not conditioning the agreement; equitable mistake relief was unavailable because the Purchaser was at fault; accordingly the motion judge erred in ordering rescission.

Court Disposition

Appeal allowed; motion for summary judgment dismissed

Orders

  • Appeal allowed and motion for summary judgment dismissed
  • Costs in this court fixed at $11,873.91 inclusive