This is a real estate law action where the Defendant purchasers entered into an agreement of purchase and sale (“APS”) with the Plaintiff builder for a new home at the purchase price of $1,115,490. However, the purchasers failed to close leading to the termination of the agreement. Consequently, the builder commenced a claim for damages for a breach of contract. A few months later, the builder was able to resell the property to a third party for $985,000 which was less than the amount specified in the initial APS.
On a motion for summary judgment, the motion judge granted judgment in favor of the builder in the amount of $383,636.47 for the failure of the purchasers to close the real estate transaction. Despite this ruling, the purchasers appealed the summary judgment award, but their appeal was dismissed by the Ontario Court of Appeal. The central issue in the appeal is mitigation. The main problem with this case is that the purchasers did not challenge the issue of mitigation by either challenging the evidence provided by the builder during cross-examination or by providing their own evidence to show that the builder’s efforts to resell the property were unreasonable, hence, damages could have been mitigated.