



COURT OF APPEAL FOR ONTARIO

CITATION: Markham Village Shoppes Limited v. Gino's Pizza Ltd.,
    2018 ONCA 746

DATE: 20180913

DOCKET: C64999

Lauwers, Miller and Nordheimer JJ.A.

BETWEEN

Markham Village Shoppes Limited

Plaintiff (Respondent)

and

Ginos Pizza Ltd.
,
    Ginos Pizza Inc., Baljit Gangar, Vick Darubra, Martin Bernard, Redwater
    Capital Realty Inc. and Haroon Amadi

Defendants (
Appellant
)

John G. Morrissey, for the appellant

Mitchell Wine, for the respondent

Heard: August 31, 2018

On appeal from the order of Justice Edward M. Morgan of
    the Superior Court of Justice, dated January 24, 2018, with reasons reported at
    2018 ONSC 565.

REASONS FOR DECISION

[1]

The appellant, Ginos Pizza Ltd., entered into a 10 year lease of commercial
    premises owned by the respondent, Markham Village Shoppes Limited. Within four
    months of the commencement of the lease, the appellant determined that the
    premises were not suitable. It demanded rescission of the lease. The respondent
    refused and took the position that the appellant had abandoned or repudiated
    the lease. The respondent took possession of the premises, sued for damages, and
    attempted to re-let in mitigation.

[2]

The respondent brought a motion for summary judgment for damages for
    unpaid rent and prospective damages for future rent. The motion judge rejected
    the appellants various defenses and awarded judgment for $85,697.96, which
    included a claim for 22 months prospective rent, discounted for present value.
    The motion judge accepted the respondents evidence that the average time to
    lease one of the ten units in the building was 22 months, and the respondents
    argument that 22 months would therefore be an appropriate measure for
    prospective damages.

[3]

The appellant does not appeal the finding of liability. It originally
    appealed the award of damages on the basis that the motion judge (1) was
    premature in adjudicating damages; and (2) erred in granting summary judgment on
    the basis of the limited record before him. The appellant argued that the
    respondent tendered inadequate evidence in support of the claim for the loss of
    prospective rent, and failed to tender expert evidence in support of a calculation
    of the net present value of prospective rent.

[4]

These grounds of appeal have since been overtaken by events. Within two
    months of the release of the decision, the respondent re-let the premises to a
    new tenant. The appellant sought leave to introduce fresh evidence on the
    appeal attesting to the new lease of the premises, which took place
    approximately 10 months after the appellants repudiation of the lease. The
    respondent conceded before us that the fresh evidence should be admitted, and
    we agree.

[5]

The appellant accepts that its original basis for the appeal is largely moot.
    There is no longer any dispute about how long it would take to re-let the
    premises. There remains, however, a significant dispute as to how damages
    should be assessed: whether it is just a matter of taxes, maintenance and
    insurance (TMI) for the months in which the premises were vacant, or whether
    more is required for base rent or the value of an ecologizer unit that the
    appellant was obligated to install but did not.

[6]

Although the principle of finality requires, generally, that damages for
    prospective loss be assessed as at the time of trial and not revisited, this
    court has recognized a limited exception where: (1) a supervening event occurs
    after trial but before the hearing of the appeal; (2) evidence of that event is
    needed to address issues raised on appeal; and (3) not receiving the evidence could
    result in an injustice:
Mercer et al. v. Sijan et al.
(1976), 14 O.R.
    (2d) 12 (C.A.);
Sengmueller v. Sengmueller
(1994), 17 O.R. (3d) 208
    (C.A.), at p. 211. When these criteria are met, a court may admit the evidence
    under the tests for the admission of fresh evidence in
Sengmueller
, or
R. v. Palmer
, [1980] 1 S.C.R. 759. This is such a case, as the
    supervening event  the re-letting of the premises 12 months earlier than the
    motion judge projected  would mean that the respondent could receive double
    recovery over that period.  A fresh review of the damages to which the
    respondent is legally entitled is required as a result of this development.

[7]

That said, nothing in these reasons should be taken as an endorsement of
    the motion judges treatment of the evidence on damages, particularly the
    proposition that the appellants failure to adduce evidence as to the appropriate
    period for calculating prospective loss of rent in any way compensated for the
    weakness of the evidence on damages that the respondent tendered. The aphorism
    that every party to a summary judgment motion is required to put their best
    foot forward does not displace the burden of proof, which remained throughout
    on the respondent.

DISPOSITION

[8]

The motion to adduce fresh evidence is granted. We allow the appeal, set
    aside the award of damages, and return the matter to the Superior Court of
    Justice for a trial for the quantification of damages. There are no costs of
    the appeal awarded.

P. Lauwers J.A.

B.W. Miller J.A.

I.V.B. Nordheimer
    J.A.


