Aird & Berlis Secures Victory With Certificate of Pending Litigation Order

In February 2024, Aird & Berlis obtained an order to register a Certificate of Pending Litigation ("CPL") against approximately 23 acres of lands in London, Ontario.

In this case, the plaintiff and defendants had verbally agreed to jointly purchase development lands in London, Ontario (the “Property”). Their intention was to develop the lands and eventually distribute the net sale proceeds evenly amongst the parties, following a sale. In order to obtain a favourable mortgage rate, one of the individual defendants agreed to register the purchased lands in their own name but on the shared understanding that the lands would be transferred to a corporation (to be incorporated) owned by each of them.

Over approximately two years, the plaintiff contributed financially to the Property. In January 2023, the plaintiff began experiencing financial issues and informed the individual defendants that they would temporarily be unable to make payments towards the property. The defendants agreed amongst themselves to sell the Property and exclude the plaintiff from any ownership or entitlement to the eventual sale proceeds. When the plaintiff became aware of the defendants’ plans, they brought a motion for leave to register a CPL. Up until cross-examinations, the defendants denied there was any agreement regarding the subject property and denied that the plaintiff had made any financial contributions whatsoever.

The Honourable Justice Gorman granted the plaintiff’s CPL motion. In her endorsement, she cited several of the defendants’ admissions on cross-examination including that the defendants:

(a) expected the plaintiff to contribute financially to the carrying costs;
(b) accepted payment from the plaintiff in the amount of $405,000 to assist in the purchase of the lands;
(c) asked the plaintiff for financial contributions following the purchase of the property;
(d) asked the plaintiff to pay taxes on the lands; and
(e) the plaintiff made payments towards, among other things, taxes and lawyer fees in the amount of $102,413.50.

Her Honour also quoted an admission in the defendants’ factum asserting “there is no question or doubt that the plaintiff advanced funds with an intention and hope to make a profit and see a return on his investment.”

In the result, Justice Gorman held that there can be “no question” that the plaintiff has an “interest in the land” and noted that, by the defendants’ own words in online group chats and admissions on cross-examination, there was an express intention to create an entitlement or interest in the land. Her Honour also stated that the money initially advanced by the plaintiff resulted in part performance and therefore the Statute of Frauds is not applicable.

Having determined that the defendants failed to demonstrate that there is no triable issue, Justice Gorman ordered the issuance of a CPL and costs in favour of the plaintiff.

Aird & Berlis represented the plaintiff with a team including Brian Chung, Anisha Bhardwaj and Bardia Jalayer.