Executive Summary: Key Legal and Evidentiary Issues

• Defendants failed to close on a residential real estate transaction and were noted in default.

• Plaintiff pursued default judgment based on breach of contract and claimed resale-related damages.

• Liability was accepted based on deemed admissions and affidavit evidence from the plaintiff.

• The court found the plaintiff’s damages evidence insufficient to prove reasonable mitigation.

• Motion for default judgment was adjourned to allow additional evidence on damages.

• No final winner declared yet — the case remains pending as the court awaits further evidence by June 23, 2025, or the motion will be dismissed without costs.

Facts of the case and contractual default

Plainview Heights Property Ltd. initiated a claim against Moreom Khatun and Rehan Uddin after a failed residential real estate transaction. The parties had entered into an Agreement of Purchase and Sale (APS) for a home in Clarington, Ontario, with a total purchase price of $1,341,369 including upgrades. The defendants paid $101,469 in deposits but failed to close on the scheduled date, May 23, 2024. No agreement was reached on extending the closing date, leading the plaintiff to terminate the APS and resell the property for $975,000.

The plaintiff brought a motion for default judgment after the defendants failed to file a defence and were noted in default. The motion was heard in writing.

Default judgment motion and legal analysis

Justice Merritt accepted that the defendants’ failure to respond resulted in deemed admissions under Rule 19.02 of Ontario’s Rules of Civil Procedure. While this supported a finding of liability, the court reiterated that unliquidated damages—such as the loss claimed in a failed real estate deal—must still be proven through proper evidence, particularly under Rules 19.05 and 19.06.

The plaintiff relied on the difference between the original sale price and the resale price as the measure of damages. However, the court emphasized that plaintiffs have a legal duty to mitigate their losses. To satisfy this obligation, they must demonstrate that they took reasonable steps to resell the property at fair market value in a timely manner.

Insufficient evidence on damages and adjournment

The plaintiff’s affidavit lacked essential details regarding the resale process. The court noted the absence of evidence showing how the property was marketed, how long it was listed, whether it was exposed to the open market, or whether other offers were received. Without this information, the court could not confirm that the resale price reflected a fair market value or that reasonable efforts were made to minimize loss.

As a result, the court declined to grant the motion for default judgment at this stage. Instead, it adjourned the motion and gave Plainview Heights Property Ltd. until June 23, 2025, to file further affidavit evidence. If no further materials are filed by that deadline, the motion will be dismissed without costs.

Status of the case and no final outcome

Because the motion was adjourned and not ruled upon definitively, no final winner has been declared yet. While liability appears established, the issue of damages remains unresolved pending further evidence. The case’s outcome hinges on whether the plaintiff provides satisfactory proof of its claimed losses by the court-imposed deadline.