Montreuil v. The Ontario Asphalt Co.

Montreuil v. The Ontario Asphalt Co.

Majority held a lessee with an unexercised option to purchase cannot be treated as believing the land was his own for the purposes of R.S.O. ch.109 s.37, so the statute does not apply; however, a lessee who acted under a bona fide mistake of title may obtain equitable compensation for lasting improvements to the extent they enhanced the land's value, subject to no recovery for improvements made after knowledge of defective title; in Ontario the compensation can be set off against mesne profits in an ejectment action and the proper course is a reference to quantify mesne profits, enhancement and the net balance.

Citation
(1922) 63 SCR 401
Parties
Plaintiffs/appellants: Alexander L. Montreuil and Others; Defendants/respondents: The Ontario Asphalt Company and the Caldwell Sand and Gravel Company
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
7 February 1922
Procedural Posture
Ejectment; Mesne Profits; Specific Performance; Statutory Interpretation / Appeal to the Supreme Court of Canada From the Appellate Division of the Supreme Court of Ontario (final Disposition)
Outcome
Appeal dismissed without costs; cross-appeal dismissed with costs; Appellate Division judgment varied by directing a reference to quantify mesne profits and enhancement in value.
Legal Topics
Improvements Under Mistake of Title, Option to Purchase, Lien for Improvements, Mesne Profits, Specific Performance, Acquiescence/estoppel, Set Off
Source Language
English
Property Law Equity Statutory Interpretation Contract Landlord Tenant Remedies Improvements Under Mistake of Title Option to Purchase +5 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Legal principles 4 Authorities cited 12 Party arguments 2 Amounts and remedies 5
Sign in to unlock

Parties

Alexander L. Montreuil and Others

Plaintiffs/appellants

The Ontario Asphalt Company and the Caldwell Sand and Gravel Company

Defendants/respondents

Procedural Posture

Ejectment; Mesne Profits; Specific Performance; Statutory Interpretation / Appeal to the Supreme Court of Canada From the Appellate Division of the Supreme Court of Ontario (final Disposition)

Legal Issues

  1. 1 Whether a lessee with an option to purchase falls within R.S.O. ch.109 s.37 permitting lien or retention for improvements made under belief land is his own
  2. 2 Whether equitable relief (compensation for improvements) is available where there was a bona fide mistake of title
  3. 3 Whether compensation for improvements can be set off against mesne profits in a common law action of ejectment in Ontario

Ratio Decidendi

Majority held a lessee with an unexercised option to purchase cannot be treated as believing the land was his own for the purposes of R.S.O. ch.109 s.37, so the statute does not apply; however, a lessee who acted under a bona fide mistake of title may obtain equitable compensation for lasting improvements to the extent they enhanced the land's value, subject to no recovery for improvements made after knowledge of defective title; in Ontario the compensation can be set off against mesne profits in an ejectment action and the proper course is a reference to quantify mesne profits, enhancement and the net balance.

Court Disposition

Appeal dismissed without costs; cross-appeal dismissed with costs; Appellate Division judgment varied by directing a reference to quantify mesne profits and enhancement in value.

Orders

  • Appeal dismissed without costs.
  • Cross-appeal dismissed with costs.