



COURT OF APPEAL FOR ONTARIO

CITATION: Azzarello v. Shawqi, 2019 ONCA 820

DATE: 20191015

DOCKET: C65977

Feldman, Paciocco and Fairburn
    JJ.A.

BETWEEN

Mark Azzarello, Eliza Azzarello

Plaintiffs (Respondents)

and

Ahmed Sabri Shawqi

Defendant (Appellant)

Shahzad Siddiqui, for the appellant

Peter D. Woloshyn, for the respondents

Heard: May 14, 2019

On appeal from the order of Justice Sandra
    Nishikawa of the Superior Court of Justice, dated September 14, 2018, with
    reasons reported at 2018 ONSC 5414.

Feldman J.A.:

[1]

The appellant was the purchaser under an agreement
    of purchase and sale of a residence in Mississauga. He failed to close on the
    date set for closing, received a number of extensions, but failed to close on
    any of the extended dates. The respondent vendors relisted the property and
    ultimately sold it for less than the price that the appellant had agreed to
    pay. In the action by the respondents for damages for breach of the agreement,
    the summary judgment motion judge awarded the difference in price to the
    respondent vendors, together with a number of consequential loss items. She
    also ordered that the deposit of $75,000 paid by the appellant purchaser be
    forfeited and not credited toward the damage award.

[2]

On this appeal, the appellants position is that
    the motion judge erred by failing to find that the respondents are not entitled
    to any damages because they failed to tender properly and were not ready,
    willing and able to close, and by finding that the respondents reasonably
    mitigated their damages. He also says that the motion judge erred by failing to
    credit the forfeited deposit toward the damages.

[3]

For the reasons that follow, I would allow the
    appeal on the deposit issue only. The amount of the forfeited deposit must be
    credited toward the damage award.

Facts

[4]

The respondents listed their home for sale on March
    19, 2017 during a very hot real estate market in the Greater Toronto Area.
    They listed the property at $1,398,000, received multiple offers, and accepted
    the appellants offer of $1,555,000 on March 27, 2017 to close on June 28,
    2017. The appellant paid a deposit of $75,000.

[5]

The respondents had agreed on March 8, 2017 to buy
    a new home near Hamilton, Ontario for $1,375,000 to close on June 1, 2017. They
    took out a bridge loan to complete that purchase and conduct some renovations
    on the new home.

[6]

On May 30, 2017, the respondents real estate
    lawyer, Mr. John Peter Ferreira, received a requisition letter and other
    documents from Mr. Joshua David, as the appellants real estate lawyer, which
    he answered the following day.

[7]

On June 19, 2017, Mr. Ferreira sent Mr. David a
    closing package by courier. However, on June 26, 2017, two days before the date
    set for closing, Mr. Ferreira received a call from Ms. Sarah Razzouk, who
    advised that she was taking over from Mr. David and would be representing the
    appellant on the purchase. On the same day, Ms. Razzouk wrote to Mr. Ferreira
    requesting an extension of the closing until July 7, 2017 and advising that she
    would pick up the closing package from Mr. Davids office.

[8]

On June 28, 2017, Ms. Razzouk sent another letter
    requesting a further extension to July 10, 2017. On June 29, 2017, Ms. Razzouk
    sent a requisition letter to Mr. Ferreira together with some vendor documents.

[9]

On July 1, 2017, the respondents agreed to extend
    the closing to July 10, 2017, on the condition that the appellant pay the
    interest on their mortgage, line of credit and bridge loan. These terms were
    accepted in a letter from Ms. Razzouk.

[10]

On July 7, 2017, Mr. Ferreira faxed to Ms. Razzouk a revised statement
    of adjustments, a direction and a request for an update on the status of the
    closing. On July 10, 2017, Ms. Razzouk faxed a message that stated: please be
    advised that I do not have mortgage instructions as of yet. As such we will require
    an extension until July 13, 2017. She sent a follow-up fax later in the day
    indicating that she did not have instructions and: [a]s of yet I do not know
    when. Client is not communicating with us anymore.

[11]

Mr. Ferreira made an offer on behalf of the respondents to extend the
    closing date to July 13, 2017, on terms that included payment of the
    respondents costs and a further $75,000 deposit to be received by 4:00 pm on
    July 11, 2017, failing which the appellant would be deemed to be in breach of
    the agreement. No response was received to this offer.

[12]

On the appellants side, he applied for a mortgage at both TD Bank and
    Scotiabank but was declined. He then advised his real estate agent that he
    would not be able to purchase the property. The motion judge noted that the
    appellant claimed that he was contacted by ICICI Bank to advise that they were
    investigating a mortgage fraud. He alleges that the mortgage agent working with
    his real estate agent had submitted fraudulent documents to apply for a mortgage
    in his name, and that ICICI Bank had advised him that he would be participating
    in the fraud if he obtained a mortgage from any institution where fraudulent
    documents had been submitted.

[13]

After the purchase did not close on July 10, the respondents re-listed
    the property for sale at the original list price of $1,398.000. As the
    respondents had moved to their new home, their old home was empty and had to be
    staged for showing purposes.

[14]

On July 27, 2017, Mr. Ferreira received a letter dated July 24, 2017
    from a lawyer, Mr. Constantine, that stated he was acting for the appellant and
    that the appellant had received a mortgage approval from the CIBC. However, he
    wanted a 10% reduction in the purchase price based on an appraisal of the
    property.

[15]

Mr. Ferreira responded on August 11, 2017, requesting the appellants
    position on a potential resolution of the matter. No response was received.

[16]

On September 5, 2017, the respondents lowered the list price to
    $1,349,000, and on September 6, 2017, they entered into a conditional agreement
    of purchase and sale with a new purchaser, which was confirmed on September 15,
    2017, for the price of $1,280,000 to close on November 15, 2017.

The decision of the motion judge

[17]

The motion judge identified the following four issues: did the
    appellant breach the agreement? If so, what damages are the respondents
    entitled to? Is the deposit forfeited to the respondents? Is the appellant
    entitled to relief from forfeiture?

[18]

The appellants position was that he was unable to close because of fraudulent
    activity perpetrated in his name by the mortgage broker who worked with his real
    estate agent. The appellant also denied that he retained either Mr. David or
    Ms. Razzouk or that he applied for a mortgage to CIBC. He claimed that he
    wanted to purchase the property for cash but at a lower price. He argued that
    the alleged fraud constituted a genuine issue for trial. He also argued that
    the respondents were not ready, willing and able to close because they failed
    to tender valid, signed documents, and that they failed to mitigate their
    damages by selling the property to him at a reduced price.

[19]

The motion judge rejected the appellants position and found that the
    appellant breached the agreement of purchase and sale by failing to close on
    July 10, 2017, and the allegations of fraud against the mortgage broker and
    real estate agent did not excuse that failure. The motion judge also found no
    evidence that a cash offer was ever communicated to the respondents.

[20]

The motion judge rejected the tender argument on a number of grounds.
    Although the tender package contained a Direction re Funds that was signed by
    Mr. Ferreira rather than by the respondents, that document could have been
    replaced with one signed by the respondents, had the appellant asked before
    closing. The appellant cannot rely on any such alleged defence when he was not
    able to close and when he was taking the position that there was no one upon
    whom to tender because the two lawyers who were communicating with Mr. Ferreira
    were not actually his lawyers. The motion judge found that the transaction did
    not close not because of any problem with the tender but because the appellant
    did not have the funds to complete the transaction.

[21]

On the issue of the quantum of damages, the motion judge stated the
    rule from
Goldstein v. Goldar
, 2018 ONSC 608, at para. 25, as follows:

The damages amount will be the difference
    between the price under the Agreement and the price of the new sale of the
    property once it closes, plus any additional carrying costs incurred by the
    Vendor in mitigating her loss and dealing with the Purchasers breach
.

[22]

The difference between the agreed price and the ultimate sale price was
    $275,000. The motion judge also awarded damages for the cost of the staging,
    legal fees, carrying costs of the property and interest on the line of credit,
    for a total of $308,688.31.

[23]

On the issue of mitigation, the motion judge found that the respondents
    took reasonable steps to mitigate. After they re-listed the property, they did
    not accept the first offer but held out for a higher price and were able to
    obtain one.

[24]

The final issue was the disposition of the deposit. The agreement of
    purchase and sale included the standard preprinted form language providing that
    the deposit was to be held in trust pending completion or other termination of
    this Agreement and to be credited towards the Purchase Price on completion.

[25]

Because the agreement was not completed, the questions were whether the
    deposit was to be forfeited to the respondents in addition to the damages, and
    was the appellant entitled to relief from forfeiture. The motion judge found
    that the deposit was forfeited but not to be credited against the damages owed.
    She then considered whether the appellant was entitled to relief from
    forfeiture and concluded that he was not. She therefore ordered the appellant
    to pay the damages plus forfeit the deposit.

Issues

[26]

The appellant raises the following three issues:

1.

Did the motion judge err in the application of the law of tender?

2.

Did the motion judge err in the application of the duty to mitigate?

3.

Did the motion judge err by failing to credit the deposit toward the
    damages?

Analysis

(1)

Did the motion judge err in the application of
    the law of tender?

[27]

The appellant submits that the respondents did not prove that they were
    ready, willing and able to close because they did not prove that all the signed
    documents and the keys were available, nor had they formally tendered the documents
    and keys.

[28]

The motion judge appeared to accept that there may have been technical
    flaws in the completeness of the respondents documents, but this was of no
    moment in the face of the appellants breach of the agreement. Whether there
    was any such flaw is not clear from the record, as Mr. Ferreiras letter to Mr.
    David dated June 28, 2017, though sent on June 19, 2017, indicates that
    enclosed were: the keys, Direction re Funds, Undertaking, UFFI/Warranties/Bill
    of Sale, Statutory Declaration, Statement of Adjustments, Solicitors
    Undertaking, Mortgage Payout Statement and document Registration Agreement.

[29]

In any event, the motion judge made no error in finding that the reason
    the transaction did not close was not from any inadequate documents from the
    seller, but because the appellant did not have the funds to complete the
    purchase.

[30]

This court has recently explained the law that applies in these
    circumstances in
Di Millo v. 2099232 Ontario Inc.
, 2018 ONCA 1051, 430
    D.L.R. (4th) 296, at paras. 45-49, leave to appeal refused, [2019] S.C.C.A. No.
    50:

For a party to be entitled to specific
    performance, the party must show he or she is ready, willing and able to close:
Time Development Group Inc. (In trust) v. Bitton
,
2018 ONSC 4384 (CanLII)
, at
    para.
53
;
    see also
Norfolk v. Aikens

(1989),
1989
    CanLII 245 (BC CA)
,
41 B.C.L.R. (2d) 145 (C.A.)
. While tender is the best
    evidence that a party is ready, willing and able to close, tender is not
    required from an innocent party enforcing his or her contractual rights when
    the other party has clearly repudiated the agreement or has made it clear that
    they have no intention of closing the deal:
McCallum v. Zivojinovic

(1977), 1977 CanLII 1151 (ON CA),
16 O.R. (2d) 721
at p. 723
    (C.A.)
; see also
Dacon Const.
Ltd.
    v. Karkoulis
,
1964
    CanLII 252 (ON SC),
[1964] 2 O.R. 139 (Ont. H.C.)
.

In
McCallum
, at p. 723,
    this court explained that the renunciation of a contract may be express or
    implied:

The renunciation of a
    contract may be express or implied. A party to a contract may state before the
    time for performance that he will not, or cannot, perform his obligations. This
    is tantamount to an express renunciation. On the other hand a renunciation will
    be implied if the conduct of a party is such as to lead a reasonable person to
    the conclusion that he will not perform, or will not be able to perform, when
    the time for performance arises.

The purchaser in
McCallum
made it clear
    that he did not intend to complete the transaction on the closing date and this
    renunciation relieved the vendors from the obligation to tender.

The principles around the
    requirement to tender are summarized succinctly by Perell J. in
Time Development Group
[2018 ONSC 4384]
, at paras. 56-57:

Tender  is not a
    prerequisite to the innocent party enforcing his or her contractual rights.
    Tender is not required from an innocent party when the other party has clearly
    repudiated the agreement. Numerous cases have held that the law does not
    require what would be a meaningless or futile gesture. Moreover, when there is
    an anticipatory breach, the innocent party need not wait to the date for
    performance before commencing proceedings for damages or in the alternative for
    specific performance of the agreement. [Citations omitted.]

Thus, when a party by words
    or conduct communicates a decision not to proceed to closing, the other party
    is released from any obligation to tender in order to prove he was ready,
    willing and able to close: see
Kirby v. Cameron
,
1961 CanLII 203 (ON
    CA),
[1961] O.R. 757 (C.A.)
;
Kloepfer Wholesale Hardware v. Roy
,
1952
    CanLII 8 (SCC)
,
[1952] 2 S.C.R. 465
.

[31]

Because the appellant made it clear on the date of closing that he did
    not have the funds to close and took no steps to close, the respondents were
    relieved of their obligation to tender. I would not give effect to this ground
    of appeal.

[32]

In oral submissions, the appellant argued in the alternative that even
    if the appellant did repudiate the agreement, the respondents cannot recover
    damages because they never elected to either accept the repudiation or to
    insist on performance. The appellant cited
1179 Hunt Club Inc. v. Ottawa
    Medical Square Inc.
,

2018 ONSC 6200, in support of the proposition
    that the innocent party must elect. As that case was under appeal at the time,
    counsel suggested that the court consider the result of the appeal in that
    case.

[33]

Since this appeal was argued,
Hunt Club

has been affirmed
    by this court: 2019 ONCA 700. However,
Hunt Club
does not assist the
    appellant. In
Hunt Club
, the vendor insisted on a certain closing
    date, and then neither party was able to close on that date. As a result, the
    agreement was at an end and the purchaser was entitled to the return of the
    deposit. In this case, the vendor was ready, willing and able to close. It was
    the purchasers lawyer who advised that the purchaser did not have the funds to
    close.

(2)

Did the motion judge err in the application of
    the duty to mitigate?

[34]

The appellant complains that the respondents did not entertain the
    offer he made after he failed to close in accordance with the agreement, to purchase
    the property for a 10% reduction in the purchase price; instead they resold the
    property for $1.28 million when they could have resold to him for just under
    $1.4 million.

[35]

I observe first that this does not appear to be the argument on
    mitigation presented at the summary judgment motion. The motion judge analyzed
    the steps taken by the respondents to resell the property and found them to be
    reasonable.

[36]

Second, it is unclear how this argument assists the appellant. His
    position in Mr. Constantines letter and in this action, was that he was
    seeking a 10% price reduction based on an appraisal of the property  not that
    he would pay the reduced price and also continue to be obligated under the
    original agreement for the difference. Unless the respondents agreed to sell to
    the appellant for a 10% reduction, and at the same time released him from his
    obligation to pay the original price, the respondents could still sue the
    appellant for the difference.

[37]

However, even if the appellant had made an offer to pay 10% less for
    the property and not be released from his obligation under the agreement of
    purchase and sale, I would reject the suggestion that the duty to mitigate
    obliges a vendor to accept an offer from the defaulting purchaser for less than
    the agreed price and then to have to sue the purchaser for the difference from
    the original agreed price.

[38]

While a vendor may choose to accept such an offer, for example in a
    declining market, the vendor cannot be obliged to do so.

[39]

The duty to mitigate is derived from the proposition that the wronged
    party cannot recover from the defaulting party for losses that could reasonably
    have been avoided: S.M. Waddams,
The Law of Contracts
,
7th ed.
    (Toronto: Thomson Reuters, 2017), at p. 529. It cannot be reasonable for a
    vendor to be obliged to reduce the loss it claims from the defaulting party by
    reselling the property to that party, then suing him or her for the difference.
    This would offer no financial advantage to the defaulting party as that party would
    be obliged to pay the same amount, either way. Yet the defaulting party would secure
    a significant tactical and procedural advantage over the innocent vendor.

[40]

The effect of endorsing the proposition advanced by the appellant would
    be to undermine the sanctity of the bargain by encouraging purchasers to
    default, particularly in a falling market, and to offer a lower price for the
    same property, leaving vendors with the risk and expense of recovering the
    balance of the original contract price in an action. The duty to mitigate does
    not go that far.

[41]

I would not give effect to this ground of appeal.

(3)

Did the motion judge err by failing to credit the
    deposit toward the damages?

[42]

There are four possible outcomes of the agreement where the disposition
    of the deposit must be determined: 1) the agreement is completed according to
    its terms; 2) the vendor breaches the agreement; 3) the purchaser breaches the
    agreement but the vendor suffers no loss; 4) the purchaser breaches the
    agreement and the vendor suffers a loss and is entitled to damages.

[43]

The agreement of purchase and sale specifically provides for the
    disposition of the deposit upon completion of the agreement: if the agreement
    is completed, the amount of the deposit is to be credited toward the purchase
    price. The agreement does not, however, specifically state what happens to the
    deposit when there is an other termination of the agreement.

[44]

Where the vendor breaches the agreement, the deposit is returned to the
    purchaser. If the purchaser has suffered damages as a result of the vendors
    default, the purchaser may also sue to recover those damages or in an
    appropriate case, may sue for specific performance of the agreement.

[45]

It is well-established by case law that when a purchaser repudiates the
    agreement and fails to close the transaction, the deposit is forfeited, without
    proof of any damage suffered by the vendor: see
Tang v. Zhang
,
2013 BCCA 52, 359 D.L.R. (4th) 104, at para. 30, approved by this court in
Redstone
    Enterprises Ltd., v. Simple Technology Inc.
,
2017 ONCA 282, 137
    O.R. (3d) 374. Where the vendor suffers no loss, the vendor may nevertheless
    retain the deposit, subject to relief from forfeiture.

[46]

This court recently restated the law regarding why a deposit is
    forfeited in
Benedetto v. 2453912 Ontario Inc.
, 2019 ONCA 149, 86
    B.L.R. (5th) 1, at paras. 5-7:

Where a payer (usually the purchaser) gives a
    vendor a deposit to secure the performance of a contract for purchase and sale
    of real estate, the deposit is forfeit if the purchaser refuses to close the
    transaction, unless the parties bargained to the contrary: see
Howe v. Smith
(1884), 27 Ch. D. 89
    (C.A.);
March Bothers & Wells v. Banton
(1911), 1911 CanLII 74 (SCC), 45 S.C.R. 338. In
Howe v. Smith
, Fry L.J. stated at p.
    101:

Money paid as a deposit must, I conceive,
    be paid on some terms implied or expressed. In this case no terms are expressed
    and we must therefore inquire what terms are to be implied. The terms most
    naturally to be implied appear to me in the case of money paid on the signing
    of a contract to be that in the event of the contract being performed it shall
    be brought into account, but if the contract is not performed by the payer it
    shall remain the property of the payee. It is not merely a part payment, but is
    then also an earnest to bind the bargain so entered into, and creates by the
    fear of its forfeiture a motive in the payer to perform the rest of the
    contract.

The deposit stands as security for the
    purchasers performance of the contract. The prospect of its forfeiture
    provides an incentive for the purchaser to complete the purchase. Should the
    purchaser not complete, the forfeiture of the deposit compensates the vendor
    for lost opportunity in having taken the property off the market in the
    interim, as well as the loss in bargaining power resulting from the vendor
    having revealed to the market the price at which the vendor had been willing to
    sell:
H.W. Liebig Co. v. Leading Investments Ltd.
, 1986 CanLII 45 (SCC), [1986] 1 S.C.R. 70, at pp. 86-87.

The motion judge provided a helpful summary of
    the law: a deposit is not part of the contract of purchase and sale, but
    stands on its own as an ancient invention of the law designed to motivate
    contracting parties to carry through with their bargains, something which
    binds the contract and guarantees its performance, and is an earnest to bind
    the bargain so entered into, and creates by the fear of its forfeiture a motive
    in the payer to perform the rest of the contract: see
Tang v. Zhang
, 2013 BCCA 52 (CanLII), 41
    B.C.L.R. (5th) 69;
Comonsents Inc. v. Hetherington
    Welch Design Ltd.
, 2006 CanLII 33779 (Ont. S.C.);
Howe v. Smith
.

[47]

However, forfeiture is always subject to the equitable remedy of relief
    from forfeiture. Section 98 of the
Courts of Justice Act
,
R.S.O.
    1990, c. C.43, provides that: [a] court may grant relief against penalties and
    forfeitures, on such terms as to compensation or otherwise as are considered
    just. In
Stockloser v. Johnson
, [1954] 1 Q.B. 476 (C.A.), the English
    Court of Appeal set out the two pronged test that has been followed in Ontario
    for applying the relief from forfeiture provision: 1) whether the forfeited
    deposit was out of all proportion to the damages suffered; and 2) whether it
    would be unconscionable for the seller to retain the deposit:
Redstone

at para. 15
.

[48]

Up to this point, I have discussed what happens to the deposit when the
    agreement is completed, when the vendor defaults and when the purchaser
    defaults but the vendor suffers no damage. The issue in this case arose when
    the vendor did suffer a loss because of the purchasers breach; in that case,
    is the deposit treated as part payment and credited toward the damages, or is
    it retained in addition to the damages, subject to relief from forfeiture?

[49]

In
Dobson v. Winton & Robbins Ltd.
,
[1959] S.C.R.
    775, where the purchaser defaulted and the vendor eventually resold the land
    for $5000 less than the agreed price, the Supreme Court stated at para. 14,
    without discussion:

[t]he measure of damages in this case is the
    difference between the price provided for in the first contract, $75,000, and
    the price provided for in the second contract, $70,000. Counsel for the
    appellant admits that against the difference of $5,000 must be credited the
    deposit of $4,000; (Mayne on Damages, 11th ed., p. 234; 29 Hals., 2nd ed., p.
    378).

The same proposition is stated in Victor
    Di Castri,
The Law of Vendor and Purchaser
, 3
rd
ed.
    (Toronto: Thomson Reuters, 2016), vol. 2 at p. 17-25, in discussing when a
    deposit is recoverable by a defaulting purchaser: [w]here the land is sold at
    a loss, [the vendor] is entitled to recover that loss, less the amount of the
    deposit.

[50]

The issue of the treatment of the deposit where the vendor suffers a
    loss arose squarely in the recent summary judgment decision,
Bang v.
    Sebastian
, 2018 ONSC 6226, affd 2019 ONCA 501.
[1]
There, two deposits were paid
    totaling $35,000, on substantially identical language as in the agreement of
    purchase and sale in this case. Counsel for the vendor submitted that the
    deposit should be forfeited without crediting it to the damages for the loss,
    on the basis of the case law referred to above that says that the deposit is
    not just part payment but is held as security and is forfeited on breach of the
    agreement.

[51]

The judge in that case rejected the vendors argument. He pointed out
    that the vendor could point to no case where the deposit was forfeited without
    crediting it toward the damages, although there were a number of cases where
    the opposite had occurred:
Goldstein; Blonski v. Jarmakowicz and Kowalski
,
    9 D.L.R. (2d) 66 (Ont. Supreme Court, High Court of Justice); and
Dobson
.

[52]

He found that the result was dictated by the wording of the agreement
    of purchase and sale, at paras. 69 and 71:

Real estate transactions routinely involve the
    payment of deposits. The proper application of the deposit in circumstances
    where the purchaser fails to complete the transaction is governed by the
    parties agreement. Here, the wording of the Agreement of Purchase and Sale
    states expressly that the deposit is to be credited towards the purchase
    price on completion of the transaction.

[]

I find that the wording of the deposit term in
    the Agreement of Purchase and Sale clearly and unambiguously reflects the
    parties intention that the deposit would be applied as a credit to the payment
    obligation owed by the purchaser defendant to the vendor plaintiffs on
    completion of the transaction. There is no difference to the use of the deposit
    in the event of termination of the agreement as opposed to its successful
    completion. Rather, it was intended to be applied as a credit to the obligation
    owed by the purchaser to the vendors: whatever form that obligation might take.
    I conclude that the $35,000 paid by the purchaser defendant is to be paid to
    the vendor plaintiffs and credited against the damages that they have proven

[53]

I agree with this analysis. While the agreement only specifically calls
    for the deposit to be credited to the purchase price on completion of the
    agreement, the measure of damages is based on the difference between the
    purchase price and the lesser amount that the property sold for after the
    purchasers default. In other words, it is based on the vendor receiving the
    purchase price that was bargained for. One can infer that the intent of the
    parties was that the deposit be applied to the purchase price whether received
    on completion or as damages.

[54]

I also agree that the cases discussed above, including
Benedetto
,
    where the deposit is forfeited because it is not just part payment but also a
    security mechanism to incentivize the purchaser to complete the transaction,
    explain why the deposit is forfeited when the vendor suffers no loss. The
    respondents point to one sentence in the
Benedetto
decision where the
    court states that a forfeited deposit does not constitute damages for breach
    of contract but stands as security for the performance of the contract: at
    para. 14. That statement is part of the explanation for the forfeiture of the
    deposit where there is no loss. However, where there is a loss, the deposit is
    treated as part payment for the damages suffered as a result of the loss.

[55]

The motion judge in the instant appeal erred in law by holding that the
    deposit be forfeited and not credited to the vendors damages.

Conclusion

[56]

I would dismiss the appeal on the issues respecting the appellants
    breach of the agreement of purchase and sale, and the issue of mitigation, but
    allow the appeal on the quantum of damages by deducting the amount of the
    deposit, $75,000, from the damages award.

[57]

As success was divided, I would order no costs of the appeal.

Released: KF OCT 15, 2019

K.
    Feldman J.A.

I
    agree. David M. Paciocco J.A.

I
    agree. Fairburn J.A.





[1]
This case was affirmed on appeal but on other grounds;
no
    challenge to the treatment of the deposit was raised.


