Executive Summary: Key Legal and Evidentiary Issues

• Equitable relief from a strict “time is of the essence” clause where the vendor’s conduct and late objection to the payment method rendered strict reliance unfair.
• Significance of email communications between counsel as evidence of what was discussed and understood regarding method of tender (direct deposit of a bank draft vs wire transfer).
• Whether silence and late insistence on contractual formalities by the vendor’s lawyer misled the purchaser’s lawyer and contributed to the failure to close on time.
• Limits of negligent misrepresentation and lawyer’s duty of care to the opposite side in a real estate transaction.
• Failure of estoppel and waiver arguments in the absence of clear reliance or a clear, intentional relinquishment of contractual rights.
• Appropriateness of specific performance as a remedy for commercial employment land considered unique to the purchaser’s business needs, rather than damages alone.

Background and facts

This case arises from a failed commercial real estate transaction involving a large parcel of vacant employment development land located at 635 Trinity Road South in the Ancaster Business Park in Jerseyville, Ontario. The land was intended for employment uses such as warehousing, manufacturing, and offices. The plaintiff, 2832676 Ontario Inc. (the Purchaser), agreed to buy the property from the defendant, Mary Treier (the Vendor), under a Revised Agreement of Purchase and Sale (APS) dated March 9, 2021. The APS was in the standard Ontario Real Estate Association (OREA) commercial form. The purchase price was $9,054,375, and the completion date was June 16, 2021, with a contractual closing deadline of 6:00 p.m. The Purchaser financed the acquisition, so closing funds had to move from the lender to the Purchaser’s lawyer and then to the Vendor’s lawyer. The Vendor’s son, Tony Treier, became heavily involved once he learned of the sale. He believed his mother had made an improvident bargain, felt she had been taken advantage of, and wanted her “out of the deal.” Early on, the same lawyer, Antonio Maddalena, acted for both the Vendor and the Purchaser, but by June 11, 2021, the Vendor had retained separate counsel, Tyler D’Angelo, who requested the closing documents. The Purchaser’s lawyer sent the documents and the lawyers exchanged further emails on June 14 and 15 to sort out what was needed for closing. On June 15, 2021, the Vendor, the Vendor’s lawyer, and the Purchaser’s lawyer met at the Purchaser’s lawyer’s office to sign documents in preparation for closing.

Key contractual provisions and tender mechanics

Several key clauses of the APS lay at the heart of the dispute. Section 2 fixed the completion date as June 16, 2021, with closing no later than 6:00 p.m. Section 19 provided that “time shall in all respects be of the essence,” subject only to any written agreement signed by the parties or their lawyers extending or abridging the time limits. Section 21 dealt with tender and specified that money “shall be tendered” with funds drawn on a lawyer’s trust account in the form of a bank draft, certified cheque, or wire transfer using the Large Value Transfer System. The first paragraph of Schedule A repeated this requirement for the balance of the purchase price. Section 11 allowed the lawyers to agree to another method or location for the exchange of “Requisite Deliveries,” including closing funds, without requiring a written amendment; they could “otherwise agree” between themselves. Finally, the APS contained an entire agreement clause. The practical question in this case was whether, in the days leading up to closing, the parties’ lawyers had, in effect, agreed to a different method of delivery (a bank-draft direct deposit) that was not strictly listed in the wording of Section 21 and Schedule A, and whether the Vendor could later insist on strict adherence to the wire-transfer method and the 6:00 p.m. closing time.

Events on the closing date and the late wire transfer

On the morning of June 16, 2021, at 8:45 a.m., the Purchaser’s lawyer emailed the Vendor’s lawyer, enclosing a package of closing documents and explicitly stating that the Vendor’s lawyer would receive “evidence” of the bank draft and its “deposit” once completed. This reflected the Purchaser’s lawyer’s plan: he intended to obtain a bank draft and, rather than physically couriering it to the Vendor’s lawyer, he would attend a bank near his own office and arrange a direct deposit of that bank draft into the Vendor lawyer’s trust account. According to the Purchaser’s lawyer, he had discussed this general approach—direct deposit of a bank draft—with the Vendor’s lawyer in the days before closing. He testified that the Vendor’s lawyer never said this method was unacceptable, and given his experience with TD Bank accepting direct deposits to law firm trust accounts, he assumed it would be fine. The Vendor’s lawyer did not deny those conversations; he simply said he could not recall them and had no notes. The court accepted the Purchaser’s lawyer’s version of events. At 2:13 p.m. on June 16, the Purchaser’s lawyer advised that the lender’s lawyer had just received funds and that they were “in the works” of getting funds to him. He added that he had told the lender not to send by wire, as wires were “taking quite a while,” and that the lender would “direct deposit.” His expectation was that they could begin the closing process “within the next hour or so.” For the first time that day, at 2:37 p.m., the Vendor’s lawyer objected, saying: “Our bank does not accept direct deposits. It will have to be a wire to our account.” The Purchaser’s lawyer responded at 2:43 p.m., stating that he routinely made direct deposits to TD law firm accounts and expressing concern that, given internal verifications and processing time, a wire might not land in time for closing. After consulting with his firm’s accounting department, the Vendor’s lawyer sent another email at 3:17 p.m., saying they could not accept direct deposit because of the perceived risk of recall, citing Section 21 and Schedule A, and insisting that “at this stage it will need to be a wire.” The Purchaser’s lawyer then arranged a wire transfer. At 3:56 p.m., he confirmed that the wire was being initiated, and at 4:05 p.m. he advised that funds had been wired, attaching confirmation and asking the Vendor’s lawyer to advise on receipt and release. When there was still no confirmation, he followed up again at 4:44 p.m. The Vendor’s lawyer replied at 4:45 p.m. that nothing had yet landed. At 5:08 p.m., recognizing that the land registration system had closed for the day and the funds were still in transit, the Purchaser’s lawyer requested a one-day extension of closing to the next day, June 17, with all other terms the same, “time to still be of the essence,” and all deliveries held in escrow pending closing. The Vendor’s lawyer did not agree. At 5:59 p.m., he sent a tender letter, formally asserting that closing had been set for 6:00 p.m., that the closing funds had not been received, and that his client had not agreed to an extension. He noted that they would deal with any incoming funds in accordance with the Law Society’s multi-party disbursement and release arrangements. At 6:12 p.m., the Purchaser’s lawyer replied outlining their position: that they had delivered documents, had been discussing direct deposit “over the last couple of days,” had only been told at 2:38 p.m. that direct deposit would not be accepted, and had wired the funds at about 3:57 p.m., having warned that the funds might not land in time. He pointed out that, had they been told earlier that direct deposit was unacceptable, they could have arranged physical delivery of certified funds by courier or driver, which was no longer possible given the late objection. He confirmed that the Purchaser remained willing and able to complete, that the funds were in transit, and that the Purchaser was reserving its rights. The wired funds ultimately arrived in the Vendor lawyer’s trust account at 1:51 p.m. on June 17, 2021, the day after the contractual closing date.

Disputes over time of the essence and the vendor’s conduct

The principal issue was whether the Vendor was entitled to terminate the APS based on the late arrival of funds, in light of the “time is of the essence” clause. The Vendor’s position was that the Purchaser failed to tender the closing funds, in a manner permitted by the APS, by 6:00 p.m. on June 16, and that this failure amounted to a repudiation the Vendor could accept, thereby terminating the deal. The Purchaser argued that the Vendor could not fairly rely on the time clause. The Purchaser’s lawyer had raised the idea of a direct deposit of a bank draft in the days before closing, and again clearly at 8:45 a.m. on the closing date. The Vendor’s lawyer said nothing until 2:37 p.m. on the closing date, when there were only a few hours left to arrange any alternate method. The court emphasized that Section 11 of the APS expressly allowed the lawyers to agree to different mechanics for the exchange of funds and documents, and that no written amendment was required for this purpose. The judge accepted that the Purchaser’s lawyer genuinely believed direct deposit of a bank draft would be acceptable, based on industry practice and his experience with TD Bank, and that the Vendor’s lawyer’s silence in the days before closing “lulled” him into a sense of security. Unlike cases where vendors repeatedly emphasize strict closing times and warn that failure to pay by the exact time will terminate the deal, here there were no such warnings or reminders. The Vendor never expressly signalled that she intended to insist strictly on actual receipt of funds in the trust account no later than 6:00 p.m. on the closing date, particularly after having been told that direct deposit was the planned method.

Equitable relief from the time clause and assessment of fairness

The court noted that a “time is of the essence” clause normally means that missing a stipulated time limit allows the innocent party to terminate. However, appellate authority recognizes a residual equitable jurisdiction to relieve against such clauses where relying on them would be unjust or inequitable, for example where one party’s conduct misleads the other or contributes to the inability to perform on time. Applying those principles, the judge found that this was an appropriate case to exercise that equitable jurisdiction. The Vendor’s lawyer knew, at minimum from the 8:45 a.m. email on closing day (and likely from earlier discussions), that the Purchaser’s lawyer planned to deliver funds by a direct deposit of a bank draft. Yet he did not communicate any objection until mid-afternoon. By then, time was tight to re-arrange a permitted payment method that would reliably land before 6:00 p.m. The Vendor’s late insistence on a wire—made in reliance on a strict reading of the APS after days of silence—placed the Purchaser’s lawyer in a difficult position. He promptly initiated a wire transfer, then followed up several times seeking confirmation and requested an overnight extension when it became apparent that the funds would not arrive before close of business. The judge also found that the Vendor’s motivation was to escape an unwanted deal. Tony Treier had long disliked the transaction and had tried unsuccessfully to get out of it or to extend closing. Once the wire arrived late, he seized on that timing to justify treating the agreement as terminated, even though the land was vacant and there was no evidence that the Vendor depended on the sale proceeds for another imminent obligation. On these facts, the judge held it was unfair and unjust for the Vendor to invoke the time clause. The Purchaser had not breached the APS in any substantive sense; rather, the Vendor breached the agreement by refusing to close once the wired funds had actually arrived.

Rejection of the alleged “Closing Funds Agreement”

The Purchaser advanced an alternative theory that, when the Vendor’s lawyer insisted on a wire at 2:37 p.m. and 3:17 p.m., an implied “Closing Funds Agreement” was formed, under which both parties accepted that the wire would be initiated late in the day and would likely arrive the following day, thereby effectively extending the closing time to whenever the funds landed. The court rejected this. Section 19 of the APS required any extension of time limits to be in a written agreement signed by the parties or their lawyers. There was no such writing, and neither lawyer had instructions to extend closing before the 6:00 p.m. deadline. The Vendor’s lawyer only spoke with Tony Treier after 5:00 p.m., and Tony refused to extend. The judge found that the Vendor’s emails insisting “it will have to be a wire” were not offers to vary the contract; they simply asserted that a wire was the only permitted method consistent with the APS and the practical realities of the day. Standard extension “phraseology” used in real estate practice—such as “all else to remain the same, time to be of the essence, and all deliveries held in escrow”—did not appear in the Vendor’s emails, but did appear in the Purchaser’s 5:08 p.m. request for an extension. If there had truly been an agreement to modify closing arrangements, the Purchaser’s lawyer would not have needed to make that later extension request and would likely have referred to the alleged agreement in his 6:12 p.m. “positioning” email. The court therefore held that there was no separate Closing Funds Agreement.

Negligent misrepresentation, estoppel, and waiver

The Purchaser also alleged that the Vendor’s lawyer had made negligent misrepresentations when he said that the closing funds “will have to be a wire” and “at this stage it will need to be a wire,” and that the Purchaser had relied on these statements to its detriment. The court refused to find a duty of care. In real estate transactions, a vendor generally does not owe a duty of care in tort to protect the purchaser’s economic interests; the parties’ mutual obligations are framed by contract. Likewise, the vendor’s lawyer’s duty is to the vendor, not to the opposite party. Absent exceptional circumstances, lawyers do not owe a duty of care to the other side, and reliance on the other side’s legal opinions or advice is ordinarily unreasonable. Here, both sides were represented by counsel and were equally capable of reading and applying the APS. In any event, the court characterized the Vendor’s lawyer’s statements as opinions about what was practically possible and contractually required, not representations of fact about, for example, the bank’s capabilities. On that footing, a negligent misrepresentation claim could not succeed. The court similarly rejected the Purchaser’s estoppel arguments—whether estoppel by convention, promissory estoppel, proprietary estoppel, or estoppel by representation. All forms relied upon require some form of reliance. The Purchaser argued that both parties shared an assumption that the wire would arrive in time on June 16, but the Purchaser’s own emails reflected doubts about the timing of a late-day wire. More importantly, the wire method and timing were already governed by the APS; the Purchaser’s lawyer believed that among the permitted methods, a wire was the best or only remaining option given the time left. There was no clear promise or representation going beyond the contract terms upon which the Purchaser changed its position to its detriment. As to waiver, the Supreme Court of Canada requires clear evidence of full knowledge of a right and an unequivocal intention to relinquish it. The court found no such intention on the Vendor’s part. Although her lawyer’s earlier silence on direct deposit was important to the equity analysis, it did not amount to an express, conscious waiver of the Vendor’s right to rely on the closing deadline under the APS.

Specific performance and uniqueness of the property

Having concluded that the Purchaser had not breached the APS and that the Vendor had repudiated it improperly, the court considered the appropriate remedy. The Purchaser sought specific performance rather than damages. The court reviewed the modern approach: specific performance is no longer treated as “extraordinary” but is granted where land, rather than its monetary equivalent, better serves justice between the parties and where damages would not be adequate. That assessment turns on factors including the nature of the property, whether it is unique in relation to the plaintiff’s intended use, the adequacy of damages, and the parties’ conduct. Both sides adduced expert evidence on comparable properties. The Purchaser’s expert focused on market activity from June 2020 to March 2024; the Vendor’s expert covered June 2017 to March 2024. They agreed that a nearby property at 1550 Cormorant Road, within the same Ancaster Business Park and of similar size, was a close comparator. The Purchaser, through another company controlled by Mr. Putman, had purchased that Cormorant Road property, with closing on January 7, 2022. The Vendor argued that this showed that a substitute was available and had in fact been acquired, undermining any claim of uniqueness. The court accepted Mr. Putman’s uncontroverted evidence that the Cormorant Road property was purchased before the APS for the disputed property fell through, even though it closed later. That meant Cormorant Road was not a replacement purchased in mitigation after the breach. The Vendor’s expert pointed to two additional properties outside the Ancaster Business Park as comparables. The Purchaser’s expert conceded they were comparable in many attributes but noted that location was different. Mr. Putman’s evidence, which the court accepted, was that being in the Ancaster Business Park was of central importance to him and his family businesses. He explained that his companies had been in the park since 1988, had accumulated many buildings and parcels there, and valued proximity to their existing operations, to their homes, to Highway 403, to Brantford, and to public transit. He also stressed that the property’s zoning, services, development potential within the urban boundary, and favourable environmental and geotechnical reports made it ideal for a warehouse and offices to support the group’s wider operations. The court concluded that, aside from Cormorant Road, this was the only comparable large parcel in the Ancaster Business Park and that the two other properties outside the park were not true substitutes for the Purchaser’s particular purposes. Taken together, these factors established that the property had qualities making it especially suitable for the Purchaser’s intended use that could not be readily duplicated elsewhere. Given this uniqueness and the Vendor’s opportunistic conduct, the court held that damages would not provide an adequate remedy and that ordering specific performance better served justice between the parties.

Outcome and relief granted

The judge exercised the court’s residual equitable jurisdiction to relieve against the strict “time is of the essence” clause, holding that the Vendor’s conduct—remaining silent about her objection to direct deposit until mid-afternoon on the closing date, then refusing to accept either the planned method or to close in escrow once a wire was initiated before 6:00 p.m.—was unfair and unjust. The court declared that the Purchaser did not breach the APS, that the Vendor did breach it by refusing to close when the wired funds ultimately arrived, and ordered specific performance of the Revised Agreement of Purchase and Sale dated March 9, 2021, requiring the Vendor to complete the sale of the property to the Purchaser. The court did not fix any specific monetary award, damages, or quantified costs in the reasons. Instead, it directed the parties to attempt to agree on costs and, failing agreement, to exchange short written costs submissions under a set timetable. As a result, while 2832676 Ontario Inc. is clearly the successful party and obtains the substantive remedy of specific performance compelling transfer of the $9,054,375 property, the exact total amount of any monetary award, including costs, cannot be determined from this decision alone.