Underlying action involved a failed real estate transaction worth $11M
In a proceeding involving a failed real estate transaction, the British Columbia Court of Appeal adhered to horizontal stare decisis and allowed the appeal of the would-be buyer, which claimed an interest in the properties based on a purchaser’s lien.
Under a contract, the appellant in RStyle Enterprises Ltd. v. 1308879 B.C. Ltd., 2026 BCCA 168, would purchase ten lots from the respondent for $11 million. The appellant paid a $1.1 million deposit.
After a dispute regarding whether the respondent had completed certain services and given the proper notice, the appellant refused to complete the transaction. The respondent terminated the contract, treating the refusal as a repudiation and the deposit as forfeited.
The appellant filed a civil claim seeking specific performance of the contract and damages. The next day, the appellant registered a certificate of pending litigation (CPL). The respondent applied to cancel the CPL.
The appellant served an amended notice of civil claim (ANOCC) that struck out the specific performance claim. The appellant claimed the return of the deposit and an interest in the land for the amount of the deposit, enforceable via a purchaser’s lien over the properties.
On Dec. 9, 2024, a chambers judge of the Supreme Court of British Columbia cancelled the CPL under s. 215(1) of BC’s Land Title Act, 1996. The judge determined that the pleading did not disclose an adequate interest in land.
The judge followed 1332404 B.C. Ltd. v. 1266685 B.C. Ltd., 2024 BCSC 592 [133 (SC)]. On appeal, 1332404 B.C. Ltd. v. 1266685 B.C. Ltd., 2025 BCCA 46 [133 (CA)] overturned the Mar. 14, 2024 decision on Feb. 11, 2025.
133 (CA), which provided that a purchaser’s lien was an interest in land that could ground a CPL, identified the necessary material facts to support a pleading under s. 215(1).
On appeal, the appellant in this case alleged that the judge committed the same errors as in 133 (SC) in almost identical circumstances. The appellant added that the facts alleged in its ANOCC included all the material facts needed to support a purchaser’s lien claim, as stated in 133 (CA).
The respondent countered that a purchaser’s lien claim also required payment to the seller under the contract “on account of the purchase price,” which the appellant’s ANOCC failed to plead.
Claim indistinguishable from 133 (CA)
The Court of Appeal for British Columbia set aside the chambers judge’s order, as the appellant’s pleading accorded with 133 (CA).
The appeal court held that 133 (CA) did not require a plaintiff to plead “on account of the purchase price” to support a claim to an interest in property based on a purchaser’s lien.
However, the appeal court pointed out that the contract here did include the words “on account of the purchase price.” The appeal court had difficulty imagining the respondent reasonably opposing or the court refusing to allow an amendment to the ANOCC to add that phrase.
The appeal court noted that 133 (CA) clarified that the court would only cancel a CPL under s. 215(1) of the Land Title Act if the pleadings could not support a claim to an interest in land. The appeal court found that the respondent failed to meet this threshold.
The appeal court considered the ANOCC capable of supporting a claim to an interest in land based on a purchaser’s lien claim.
Lastly, the appeal court directed the appellant to notify the respondent five business days before registering another CPL on any of the lots.
If the issue remained outstanding, the appeal court would direct the respondent to apply to cancel any subsequently registered CPL on grounds other than s. 215(1).
