Claims concerning property purchase dismissed as statute-barred after ex-counsel missed deadline
The Ontario Court of Appeal allowed an appeal and granted a variation to award legal fees in a case arising from an action alleging that lawyers negligently overlooked the limitation period, which led to the dismissal of real estate litigation.
In Westmount-Keele Limited v. Nicholas C. Tibollo Professional Corporation, 2025 ONCA 401, the appellant closed a real estate transaction with Royal Host Hotels (RH) two decades ago. The appellant’s principal intended to turn the purchased hotel property into a condominium.
However, a real estate dispute arose after some of the transaction’s aspects failed to proceed as expected. The appellant alleged that RH:
- failed to timely vacate the property, which led to significant costs due to construction delay
- had to provide reimbursement for municipal property taxes paid while the property remained occupied
- removed or allowed the removal of equipment and appliances included in the transaction
- had employees who damaged the property’s doors and elevators, which required repairs
The respondents – Nicholas C. Tibollo and Nicholas C. Tibollo Professional Corporation – represented the appellant in proceedings initiated against RH. However, the respondents missed the limitation period, as the court found.
Years later, RH moved to amend its claim and obtain summary judgment. RH alleged that the limitation period barred the appellant’s action.
The court dismissed most of the appellant’s claims against RH for being statute-barred. The trial moved forward on the remaining claim regarding the amount RH should receive for its expenses to shut down the hotel.
In December 2017, the appellant brought a solicitor’s negligence action against the respondents. The witnesses included Joseph Sereda, who inherited the file from Tibollo in 2008 and represented the appellant until 2016.
The trial judge awarded the appellant $142,901. The appellant challenged the judgment since this amount was much lower than what it claimed.
Judgment varied
The Court of Appeal for Ontario allowed the appeal in connection with the property’s elevator repairs and Sereda’s and Tibollo’s legal fees but dismissed the remainder of the appeal. The appeal court varied the judgment to award the appellant damages in the amount of:
- $52,965 for the elevator repairs, on consent
- $47,455 for the legal fees owed to Sereda
- $29,441.85 for the legal fees paid to the respondents
Regarding the respondents’ legal fees, the appeal court found the appellant entitled to damages for these fees.
The appeal court noted that the trial judge determined that the respondents offered value to the appellant through giving legal advice, drafting pleadings, and helping it substantiate damages. However, the appeal court ruled that the judge failed to consider that the respondents’ own negligence made most of these efforts irrelevant.
About Sereda’s legal fees, the appeal court held that the judge improperly deemed this claim statute-barred. The appeal court explained that the claim fell within the limitation period because the clock only started to run after the conclusion of the appellant’s action against the respondents.
On the elevator repairs, counsel for the opposing party conceded at trial to an award of $52,965, representing the appellant’s expenses for such repairs. However, the appeal court found that the judge failed to tackle this item in her reasons.
Next, the appeal court ruled that the judge made reasonable factual findings and committed no errors in refusing to award damages relating to vacant possession and construction delays, without adequate evidence on the delay’s impacts.
The appeal court also deemed the judge entitled to see no basis to award damages for the claim that RH breached its contractual obligation to transfer the equipment and chattels included in the agreement to the appellant.
Lastly, the appeal court accepted that the judge failed to address the appellant’s request for reimbursement of property taxes. However, the appeal court considered the appellant’s evidence to support this claim weak and unpersuasive.
