Executive Summary: Key Legal and Evidentiary Issues

• Anticipatory breach of an unconditional residential agreement of purchase and sale for 30 Plunkett Court and the resulting entitlement to damages.
• Causation and scope of recoverable “flow-through” damages arising from the plaintiffs’ inability to close on the related Franklin Trail purchase.
• Adequacy of the plaintiffs’ mitigation efforts in remarketing the Plunkett property and in managing their exposure on the Franklin Trail claim.
• Appropriateness of summary judgment in a failed real estate transaction where breach is admitted and damages are largely documentary.
• Proper measure and timing of damages in a declining real estate market, including whether to use resale price versus hypothetical valuations at breach.
• Justification (or lack thereof) for staying enforcement of judgment pending a separate third-party action against the defendants’ realtor and brokerage.

Factual background

This case arises from a failed residential real estate transaction involving the sale of the plaintiffs’ home at 30 Plunkett Court in Barrie, Ontario. The plaintiffs, Gregory and May Anne Boucher, listed the property for $1,899,000 on May 4, 2022. Two days later, on May 6, 2022, the defendants, Carolyn Molyneaux and Catherine Brassard, submitted an unconditional offer to purchase the property for $1,900,000, which the plaintiffs accepted, and the defendants paid a $70,000 deposit. The scheduled closing date was August 15, 2022. In reliance on this unconditional agreement, the plaintiffs entered into their own unconditional agreement of purchase and sale to buy another property at 7 Franklin Trail in Barrie for $1,550,000, paying a $70,000 deposit and intending to use the Plunkett sale proceeds to fund the purchase. When financing concerns emerged for the defendants, their solicitor advised the plaintiffs’ solicitor on June 16, 2022 that the defendants wished to be released from the Plunkett agreement because they would not be able to close. The plaintiffs refused, given their own unconditional obligations on Franklin Trail. On June 20, 2022, the defendants confirmed they would not be completing the purchase and asked that the property be relisted to mitigate damages, while also taking the position that their deposit should not be forfeited and requesting a mutual release. The plaintiffs declined to sign a release but accepted that the defendants’ communications amounted to an anticipatory breach and began remarketing the property. The Plunkett property was relisted on June 23, 2022 at $1,899,000 and, in light of a softening market, the list price was reduced to $1,830,000 on June 27, 2022. As predicted, the defendants did not close on August 15, 2022.

Efforts to salvage the transaction and market conditions

After the failed closing date, the defendants returned with a fresh, conditional offer on August 22, 2022 to purchase the Plunkett property for $1,800,000—a $100,000 reduction from the original price. Their new offer was contingent both on financing and on a full release among all parties and brokerages. The plaintiffs were unable to carry two properties indefinitely and advised the Franklin Trail vendor they could not close on that purchase. Nevertheless, they tried to work with the defendants to find a solution that could minimize their exposure on Franklin Trail. The plaintiffs signed back the August 22 offer at the original $1,899,000 and removed the conditions, and they explored whether the Franklin Trail purchase could be resurrected. Those efforts failed. The defendants counter-offered at $1,830,000 but maintained the release condition, which remained unacceptable to the plaintiffs. Meanwhile, the real estate market continued to decline. By September 20, 2022, with no acceptable offers, the plaintiffs reduced the Plunkett list price to $1,779,000. By December 2022 there were still no offers, so the listing was briefly suspended and then re-launched on January 6, 2023 at $1,650,000. On January 8, 2023, the plaintiffs received a first firm, unconditional offer of $1,640,000, which they accepted on their realtor’s advice. That sale closed on March 17, 2023. On the closing date, the defendants agreed to release the original $70,000 deposit to the plaintiffs. The eventual sale price left the plaintiffs with a $260,000 shortfall from the original $1,900,000 agreement, and they also incurred documented carrying costs of $16,258.04 between the failed closing and ultimate sale.

The Franklin Trail transaction and consequential losses

The Franklin Trail agreement was a key part of the plaintiffs’ losses. The plaintiffs had entered into an unconditional agreement to buy 7 Franklin Trail for $1,550,000, backed by a $70,000 deposit. When trouble with the defendants surfaced, the Franklin Trail vendor extended the closing from July 18 to July 27, 2022, in an attempt to keep that deal alive while the plaintiffs tried to salvage the Plunkett sale. Ultimately, the plaintiffs could not close and were forced to breach the Franklin Trail agreement. Franklin Trail was then resold in October 2022 for $1,250,000—$300,000 below the plaintiffs’ agreed purchase price. The vendor also incurred carrying costs of $32,454.63. In response, the Franklin Trail vendors sued the plaintiffs, seeking damages of $393,189.87 plus $1,000,000 in general damages. In May 2023, the plaintiffs agreed to forfeit their $70,000 deposit to the Franklin Trail vendors. Later, the vendors served a formal offer to settle under Rule 49 in the amount of $265,277.37. This sum represented the vendor’s loss of value on resale plus carrying costs, net of the forfeited deposit. The plaintiffs accepted the offer, resulting in a binding compromise of the Franklin Trail claim. This “flow-through” loss, entirely triggered by the defendants’ failure to complete the Plunkett purchase, became a central component of the damages sought on the summary judgment motion.

The motion for summary judgment and the parties’ positions

The plaintiffs moved for summary judgment, seeking several heads of relief: damages for the $260,000 loss on resale of the Plunkett property, their carrying costs of $16,258.04, a declaration that the $70,000 Plunkett deposit was forfeited to them, an indemnity for all amounts they were liable to the Franklin Trail vendors (including the $70,000 Franklin deposit), and interest under the Courts of Justice Act. The defendants resisted summary judgment, arguing that there were genuine issues requiring a trial, particularly concerning quantification and timing of damages, mitigation efforts, and the proper date for assessing the loss in a falling market. They relied on an expert report from a “mortgage expert” produced in their separate third-party action against their realtor and brokerage. That expert opined that the plaintiffs could have obtained financing to carry both the Plunkett and Franklin properties through various options such as private lending, mortgage investment corporations, blanket mortgages, or expanded use of lines of credit, despite higher interest rates and possible penalties. The defendants submitted that this report showed additional mitigation steps were available, and that the plaintiffs had failed in their duty to mitigate. They also argued that, because damages might be assessed differently depending on evidence of market conditions between the date of anticipatory breach (in June 2022) and the scheduled closing (August 15, 2022), a full trial was necessary. Finally, the defendants sought a stay of enforcement of any judgment pending the outcome of their third-party claim against the realtor and brokerage, contending that such a stay would be in the interests of justice.

Legal framework for summary judgment and damages

Justice Casullo applied the summary judgment framework in Rule 20 and the Supreme Court of Canada’s decision in Hryniak v. Mauldin. The court reiterated that summary judgment is appropriate where the evidentiary record allows the judge to make the necessary factual findings, apply the law, and reach a fair and just determination without the cost and delay of a full trial. Decisions such as Mari v. Sanjer, Gamoff v. Hu, and Oliver v. Nourouzi were cited as examples that failed real estate transactions, especially where breach is admitted, can be well suited to summary judgment. On damages, the court recognized that purchasers who breach a binding agreement of purchase and sale are liable for the difference between the contract price and the eventual resale price, plus reasonable carrying costs. The court also noted that carrying costs are a recognized head of damages in failed real estate cases. For the timing and measure of loss in a falling market, the court endorsed earlier authority holding that actual resale price is often the best evidence of the real loss suffered, rather than hypothetical valuations at the date of breach.

Findings on breach, mitigation, and quantum of loss

The defendants admitted they breached a valid and enforceable contract and that the plaintiffs were the innocent parties. With liability established, the dispute centered on whether there was any genuine issue requiring a trial on damages. Justice Casullo held there was not. The court found that the plaintiffs’ damages had fully crystallized, including both the losses on the Plunkett resale and the amounts paid to resolve the Franklin Trail claim. The court rejected the defendants’ contention that the plaintiffs had failed to mitigate. The mortgage expert’s suggestions were found to be largely theoretical, involving costly and burdensome financing options that went beyond what reasonableness required. The legal duty to mitigate obliges a plaintiff to take reasonable steps to lessen their loss, not to pursue every expensive or risky alternative simply because it might exist in theory. Against that standard, the plaintiffs’ conduct—promptly remarketing Plunkett, progressively reducing the listing price on professional advice, engaging with the defendants’ renewed offers while refusing unreasonable release conditions, and negotiating a pragmatic settlement with the Franklin Trail vendors—was held to be reasonable and sufficient. On the measure of loss from the Plunkett breach, the court accepted that the difference between the original $1,900,000 sale price and the eventual $1,640,000 resale, plus documented carrying costs, was the appropriate measure. The court declined the defendants’ argument that damages should be fixed by reference to a hypothetical valuation as of the date of breach or the scheduled closing, emphasizing that the actual resale price was the best evidence of the true loss.

Ruling, successful party, and total monetary award

Justice Casullo granted the plaintiffs’ motion for summary judgment. The court awarded a total of $556,535.41 in damages against the defendants. For the Plunkett property, the court calculated $260,000 for the loss on resale plus $16,258.04 in carrying costs, for a subtotal of $276,258.04. After deducting the $70,000 deposit already received, the net damages for Plunkett were $206,258.04. For Franklin Trail, the court treated the plaintiffs’ forfeited $70,000 deposit and the accepted Rule 49 settlement of $265,277.37, together with $15,000 in costs paid to the Franklin vendors, as recoverable consequential loss, totaling $350,277.37. Combining both properties, the overall damages came to $556,535.41. The court also formally declared that the $70,000 Plunkett deposit was forfeited to the plaintiffs and ordered prejudgment interest from February 9, 2023 to the date of judgment, with post-judgment interest thereafter under the Courts of Justice Act. The defendants’ request for a stay of enforcement pending their third-party claim was refused, the court characterizing such a stay as unjust and “mean-spirited” given the plaintiffs’ clear entitlement. The plaintiffs were held presumptively entitled to their costs as the successful parties, but the precise quantum of costs was left either to agreement or to short written submissions; accordingly, the exact costs figure had not yet been fixed in this ruling. In sum, the plaintiffs, Gregory and May Anne Boucher, emerged as the successful party, obtaining a judgment in the principal amount of $556,535.41 plus interest and an entitlement to costs, while the specific dollar amount of those costs remained undetermined at the time of the decision.