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Injunctions and Stays

1. General
2. Injunctions Generally
3. Stay Pending Appeal
4. Interlocutory Injunctions
5. Specific Performance and Real Estate


1. General

Injunctions are non-monetary court orders that govern behaviour of parties. Stays are orders that suspend earlier orders, typically during appeals or judicial review. Most legal activity in this area is with respect to interlocutory injunctions, which tend to govern the parties' behaviour pending the outcome of the full injunction case.

2. Injunctions Generally

. 1711811 Ontario Ltd. (AdLine) v. Buckley Insurance Brokers Ltd.

In 1711811 Ontario Ltd. (AdLine) v. Buckley Insurance Brokers Ltd. (Ont CA, 2014) the court took the oppourtunity to explain the differences between the different types of injunctions: interim, interlocutory, mandatory and permanent.

[49] Various types of injunctive relief have been sought or ordered in this proceeding: interim, interlocutory, mandatory and permanent. What do each of those terms mean and how do they differ from one another?

[50] Let us first consider interim and interlocutory injunctions. While motions for pre-trial injunctive relief often term the relief that is sought as both interim and interlocutory, some distinctions can be drawn between the two.

[51] A motion for an interim injunction can be made ex parte or on notice. Argument on the motion is generally quite limited and, if an order is made for interim injunctive relief, the order is typically for a brief, specified period of time: see Robert J. Sharpe, Injunctions and Specific Performance, loose-leaf (Toronto: Canada Law Book, 2013), at para. 2.15. If an interim injunction is granted on an ex parte basis, the moving party must normally bring a further motion to have the interim injunction continued

[52] An interlocutory injunction, like an interim injunction, is a pre-trial form of relief. It is an order restraining the defendant for a limited period, such as until trial or other disposition of the action: see Sharpe, at para. 2.15. Interlocutory injunctive relief typically follows much more thorough argument than that for an interim injunction, by both parties, and is generally for a longer duration than an interim injunction.

[53] The present case provides an example of both an interim and an interlocutory injunction.

[54] The Interim Order is an example of an interim injunction. AdLine originally moved for interim injunctive relief on an ex parte basis. However, both parties were present when the motion for interim relief was argued. Justice Stinson opened his endorsement by emphasizing the very limited nature of the question before him: should interim injunctive relief be granted pending the scheduled hearing of the Contempt Motion? The injunctive relief granted in the Interim Order was specified to last for that period of slightly less than two months.

[55] The Consent Order, on the other hand, was the product of both parties’ participation, and the duration of the injunctive relief restraining Buckley’s use of the laneway, while not clear on the face of the Consent Order, appears to have been for the period of the laneway’s renovation in 2009.

[56] The next useful distinction to be drawn is between interlocutory and permanent injunctions. Interlocutory injunctions are imposed in ongoing cases whereas permanent injunctions are granted after a final adjudication of rights: see Sharpe, at para. 1.40, citing Liu v. Matrikon Inc., 2007 ABCA 310 (CanLII), 2007 ABCA 310, 422 A.R. 165, at para. 26. As will be seen, this conceptual distinction features prominently in the present case, where a key issue is whether the court must apply a different test for permanent injunctions than for interlocutory injunctions.

[57] It is also important to distinguish between mandatory and permanent injunctions. A mandatory injunction is one that requires the defendant to act positively. It may require the defendant to take certain steps to repair the situation consistent with the plaintiff’s rights, or it may require the defendant to carry out an unperformed duty to act in the future: see Sharpe, at para. 1.10. Mandatory injunctions are rarely ordered and must be contrasted with the usual type of injunctive relief, which prohibits certain specified acts.

[58] Because of their very nature, mandatory injunctions are often permanent. However, permanent injunctions are not necessarily mandatory. An example illustrates this point. If, after trial, a court orders that a defendant can never build on a right of way, it will have made a permanent order enjoining the defendant from building on the right of way. But, the injunction would not be mandatory because it does not require the defendant to perform a positive act.

[59] In short, the words “mandatory” and “permanent” are not synonymous, especially in the context of injunctive relief.
The court also explained the differences in the tests for interlocutory versus permanent injunctions:
Issue 2 – Is the Test for a Permanent Injunction Different than the Test for an Interlocutory Injunction?

[74] The test for interlocutory injunctions is the familiar three-part inquiry set out in RJR-MacDonald: is there a serious issue to be tried; would the moving party otherwise suffer irreparable harm; and, does the balance of convenience favour granting the injunction.

[75] Does that same test apply when the court is deciding whether to grant permanent injunctive relief? AdLine contends that it does and points to cases such as Hanisch v. McKean, 2013 ONSC 2727 (CanLII), 2013 ONSC 2727, at para. 111, and Poersch v. Aetna, 2000 CanLII 22613 (ON SC), 2000 CanLII 22613 (Ont. S.C.), at para. 103, where the courts have expressly applied the test when deciding whether to grant permanent injunctive relief.

[76] I would not accept this submission. In my view, a different test must apply.

[77] The British Columbia Court of Appeal recently considered the test for a permanent injunction and its relationship to the test for an interlocutory injunction. In the decision under review in Cambie Surgeries Corp. v. British Columbia (Medical Services Commission), 2010 BCCA 396 (CanLII), 2010 BCCA 396, 323 D.L.R. (4th) 680, the trial judge granted permanent injunctive relief based on the test for an interlocutory injunction. Despite the parties’ agreement that the trial judge correctly set out the test, the British Columbia Court of Appeal held that the wrong test had been applied and reversed the trial decision.

[78] Justice Groberman, writing for the court, explained that the RJR-Macdonald test is for interlocutory – not final or permanent – injunctions. At para. 24 of Cambie Surgeries, he explained that the RJR-Macdonald test is designed to address situations in which the court does not have the ability to finally determine the merits of the case but, nonetheless, must decide whether interim relief is necessary to protect the applicant’s interests.

[79] In paras. 27-28 of Cambie Surgeries, Groberman J.A. explained:
Neither the usual nor the modified test discussed in RJR-MacDonald has application when a court is making a final (as opposed to interlocutory) determination as to whether an injunction should be granted. The issues of irreparable harm and balance of convenience are relevant to interlocutory injunctions precisely because the court does not, on such applications, have the ability to finally determine the matter in issue. A court considering an application for a final injunction, on the other hand, will fully evaluate the legal rights of the parties.

In order to obtain final injunctive relief, a party is required to establish its legal rights. The court must then determine whether an injunction is an appropriate remedy. Irreparable harm and balance of convenience are not, per se, relevant to the granting of a final injunction, though some of the evidence that a court would use to evaluate those issues on an interlocutory injunction application might also be considered in evaluating whether the court ought to exercise its discretion to grant final injunctive relief.
[80] I would adopt this reasoning. The RJR-Macdonald test is designed for interlocutory injunctive relief. Permanent relief can be granted only after a final adjudication. Different considerations operate and, therefore, a different test must be applied, pre- and post-trial.

3. Stay Pending Appeal

. Prince Edward County Field Naturalists v. Ostrander Point GP Inc.

In Prince Edward County Field Naturalists v. Ostrander Point GP Inc. (Ont CA, 2014) the court made the following salutory comments on the contrasting natures of stays of (lower-court) Orders pending appeal and interlocutory injunctions:
[8] Ostrander argued that PECFN is not truly requesting a stay of the order of the Divisional Court under Rule 63.02(1) of the Rules of Civil Procedure, but is, in reality, seeking an interlocutory injunction prohibiting the operation of the REA. While the criteria for obtaining a stay and for obtaining an interlocutory injunction have common elements, a party seeking an interlocutory injunction is additionally required to provide an undertaking as to damages. PECFN has not done so.


[12] The criteria for obtaining a stay of an order pending appeal or an application for leave to appeal are well-known and not contested. The moving party must show (a) that it has raised, or will raise if leave is granted, a serious issue for consideration on appeal; (b) that it will suffer irreparable harm if a stay is not granted; and (c) that the balance of convenience favours such an order: RJR-MacDonald v. Canada (Attorney General), 1994 CanLII 117 (SCC), [1994] 1 S.C.R. 311. For leave to appeal to be granted, the proposed appeal must raise an issue of some public importance: Re Sault Dock Co. Ltd. and City of Sault Ste. Marie, 1972 CanLII 572 (ON CA), [1973] 2 O.R. 479 (C.A.).

4. Interlocutory Injunctions

. Google Inc. v. Equustek Solutions Inc.

In this interesting and wide-ranging case, Google Inc. v. Equustek Solutions Inc. (Ont CA, 2017), the Supreme Court of Canada reviews the law of interlocutory injunctions (injunctions issued pending the outcome of the primary proceeding) against a large international third party, which in this case was alleged to be aiding the defendant in the breach of the plaintiff's intellectual property rights:
[22] The decision to grant an interlocutory injunction is a discretionary one and entitled to a high degree of deference (Manitoba (Attorney General) v. Metropolitan Stores Ltd., 1987 CanLII 79 (SCC), [1987] 1 S.C.R. 110, at pp. 155-56). In this case, I see no reason to interfere.

[23] Injunctions are equitable remedies. “The powers of courts with equitable jurisdiction to grant injunctions are, subject to any relevant statutory restrictions, unlimited” (Ian Spry, The Principles of Equitable Remedies (9th ed. 2014), at p. 333). Robert Sharpe notes that “[t]he injunction is a flexible and drastic remedy. Injunctions are not restricted to any area of substantive law and are readily enforceable through the court’s contempt power” (Injunctions and Specific Performance (loose-leaf ed.), at para. 2.10).

[24] An interlocutory injunction is normally enforceable until trial or some other determination of the action. Interlocutory injunctions seek to ensure that the subject matter of the litigation will be “preserved” so that effective relief will be available when the case is ultimately heard on the merits (Jeffrey Berryman, The Law of Equitable Remedies (2nd ed. 2013), at pp. 24-25). Their character as “interlocutory” is not dependent on their duration pending trial.

[25] RJR — MacDonald Inc. v. Canada (Attorney General), 1994 CanLII 117 (SCC), [1994] 1 S.C.R. 311, sets out a three-part test for determining whether a court should exercise its discretion to grant an interlocutory injunction: is there a serious issue to be tried; would the person applying for the injunction suffer irreparable harm if the injunction were not granted; and is the balance of convenience in favour of granting the interlocutory injunction or denying it. The fundamental question is whether the granting of an injunction is just and equitable in all of the circumstances of the case. This will necessarily be context-specific.

[26] Google does not dispute that there is a serious claim. Nor does it dispute that Equustek is suffering irreparable harm as a result of Datalink’s ongoing sale of the GW1000 through the Internet. And it acknowledges, as Fenlon J. found, that it inadvertently facilitates the harm through its search engine which leads purchasers directly to the Datalink websites.

[27] Google argues, however, that the injunction issued against it is not necessary to prevent that irreparable harm, and that it is not effective in so doing. Moreover, it argues that as a non-party, it should be immune from the injunction. As for the balance of convenience, it challenges the propriety and necessity of the extraterritorial reach of such an order, and raises freedom of expression concerns that it says should have tipped the balance against granting the order. These arguments go both to whether the Supreme Court of British Columbia had jurisdiction to grant the injunction and whether, if it did, it was just and equitable to do so in this case.

[28] Google’s first argument is, in essence, that non-parties cannot be the subject of an interlocutory injunction. With respect, this is contrary to the jurisprudence. Not only can injunctive relief be ordered against someone who is not a party to the underlying lawsuit, the contours of the test are not changed. As this Court said in MacMillan Bloedel Ltd. v. Simpson, 1996 CanLII 165 (SCC), [1996] 2 S.C.R. 1048, injunctions may be issued “in all cases in which it appears to the court to be just or convenient that the order should be made . . . on terms and conditions the court thinks just” (para. 15, citing s. 36 of the Law and Equity Act, R.S.B.C. 1979, c. 224). MacMillan Bloedel involved a logging company seeking to restrain protesters from blocking roads. The company obtained an interlocutory injunction prohibiting not only specifically named individuals, but also “John Doe, Jane Doe and Persons Unknown” and “all persons having notice of th[e] Order” from engaging in conduct which interfered with its operations at specific locations (para. 5). In upholding the injunction, McLachlin J. noted that
[i]t may be confidently asserted . . . that both English and Canadian authorities support the view that non-parties are bound by injunctions: if non-parties violate injunctions, they are subject to conviction and punishment for contempt of court. The courts have jurisdiction to grant interim injunctions which all people, on pain of contempt, must obey. [Emphasis added; para. 31.]
See also Berryman, at pp. 57-60; Sharpe, at paras. 6.260 to 6.265.

[29] In other words, where a non-party violates a court order, there is a principled basis for treating the non-party as if it had been bound by the order. The non-party’s obligation arises “not because [it] is bound by the injunction by being a party to the cause, but because [it] is conducting [itself] so as to obstruct the course of justice” (MacMillan Bloedel, at para. 27, quoting Seaward v. Paterson, [1897] 1 Ch. 545 (C.A.), at p. 555).

[30] The pragmatism and necessity of such an approach was concisely explained by Fenlon J. in the case before us when she offered the following example:
. . . a non-party corporation that warehouses and ships goods for a defendant manufacturing company might be ordered on an interim injunction to freeze the defendants’ goods and refrain from shipping them. That injunction could affect orders received from customers around the world. Could it sensibly be argued that the Court could not grant the injunction because it would have effects worldwide? The impact of an injunction on strangers to the suit or the order itself is a valid consideration in deciding whether to exercise the Court’s jurisdiction to grant an injunction. It does not, however, affect the Court’s authority to make such an order.[2]
[31] Norwich orders are analogous and can also be used to compel non-parties to disclose information or documents in their possession required by a claimant (Norwich Pharmacal Co. v. Customs and Excise Commissioners, [1974] A.C. 133 (H.L.), at p. 175). Norwich orders have increasingly been used in the online context by plaintiffs who allege that they are being anonymously defamed or defrauded and seek orders against Internet service providers to disclose the identity of the perpetrator (York University v. Bell Canada Enterprises (2009), 2009 CanLII 46447 (ON SC), 311 D.L.R. (4th) 755 (Ont. S.C.J.)). Norwich disclosure may be ordered against non-parties who are not themselves guilty of wrongdoing, but who are so involved in the wrongful acts of others that they facilitate the harm. In Norwich, this was characterized as a duty to assist the person wronged (p. 175; Cartier International AG v. British Sky Broadcasting Ltd., [2017] 1 All E.R. 700 (C.A.), at para. 53). Norwich supplies a principled rationale for granting injunctions against non-parties who facilitate wrongdoing (see Cartier, at paras. 51-55; and Warner-Lambert Co. v. Actavis Group PTC EHF, 144 B.M.L.R. 194 (Ch.)).

[32] This approach was applied in Cartier, where the Court of Appeal of England and Wales held that injunctive relief could be awarded against five non-party Internet service providers who had not engaged in, and were not accused of any wrongful act. The Internet service providers were ordered to block the ability of their customers to access certain websites in order to avoid facilitating infringements of the plaintiff’s trademarks. (See also Jaani Riordan, The Liability of Internet Intermediaries (2016), at pp. 412 and 498-99.)

[33] The same logic underlies Mareva injunctions, which can also be issued against non-parties. Mareva injunctions are used to freeze assets in order to prevent their dissipation pending the conclusion of a trial or action (Mareva Compania Naviera S.A. v. International Bulkcarriers S.A., [1975] 2 Lloyd’s Rep. 509 (C.A.); Aetna Financial Services Ltd. v. Feigelman, 1985 CanLII 55 (SCC), [1985] 1 S.C.R. 2). A Mareva injunction that requires a defendant not to dissipate his or her assets sometimes requires the assistance of a non-party, which in turn can result in an injunction against the non-party if it is just and equitable to do so (Stephen Pitel and Andrew Valentine, “The Evolution of the Extra-territorial Mareva Injunction in Canada: Three Issues” (2006), 2 J. Priv. Int’l L. 339, at p. 370; Vaughan Black and Edward Babin, “Mareva Injunctions in Canada: Territorial Aspects” (1997), 28 Can. Bus. L.J. 430, at pp. 452-53; Berryman, at pp. 128-31). Banks and other financial institutions have, as a result, been bound by Mareva injunctions even when they are not a party to an underlying action.

[34] To preserve Equustek’s rights pending the outcome of the litigation, Tindale J.’s order of December 13, 2012 required Datalink to cease carrying on business through the Internet. Google had requested and participated in Equustek’s obtaining this order, and offered to comply with it voluntarily. It is common ground that Datalink was unable to carry on business in a commercially viable way unless its websites were in Google’s search results. In the absence of de-indexing these websites, as Fenlon J. specifically found, Google was facilitating Datalink’s breach of Tindale J.’s order by enabling it to continue carrying on business through the Internet. By the time Fenlon J. granted the injunction against Google, Google was aware that in not de-indexing Datalink’s websites, it was facilitating Datalink’s ongoing breach of Tindale J.’s order, the purpose of which was to prevent irreparable harm to Equustek.

[35] Much like a Norwich order or a Mareva injunction against a non-party, the interlocutory injunction in this case flows from the necessity of Google’s assistance in order to prevent the facilitation of Datalink’s ability to defy court orders and do irreparable harm to Equustek. Without the injunctive relief, it was clear that Google would continue to facilitate that ongoing harm.

[36] Google’s next argument is the impropriety of issuing an interlocutory injunction with extraterritorial effect. But this too contradicts the existing jurisprudence.

[37] The British Columbia courts in these proceedings concluded that because Google carried on business in the province through its advertising and search operations, this was sufficient to establish the existence of in personam and territorial jurisdiction. Google does not challenge those findings. It challenges instead the global reach of the resulting order. Google suggests that if any injunction is to be granted, it should be limited to Canada (or alone.

[38] When a court has in personam jurisdiction, and where it is necessary to ensure the injunction’s effectiveness, it can grant an injunction enjoining that person’s conduct anywhere in the world. (See Impulsora Turistica de Occidente, S.A. de C.V. v. Transat Tours Canada Inc., 2007 SCC 20 (CanLII), [2007] 1 S.C.R. 867, at para. 6; Berryman, at p. 20; Pitel and Valentine, at p. 389; Sharpe, at para. 1.1190; Spry, at p. 37.) Mareva injunctions have been granted with worldwide effect when it was found to be necessary to ensure their effectiveness. (See Mooney v. Orr (1994), 98 B.C.L.R. (2d) 318 (S.C.); Berryman, at pp. 20 and 136; Babanaft International Co. S.A. v. Bassatne, [1990] 1 Ch. 13 (C.A.); Republic of Haiti v. Duvalier, [1990] 1 Q.B. 202 (C.A.); Derby & Co. v. Weldon, [1990] 1 Ch. 48 (C.A.); and Derby & Co. v. Weldon (Nos. 3 and 4), [1990] 1 Ch. 65 (C.A.); Sharpe, at paras. 1.1190 to 1.1220.)

[39] Groberman J.A. pointed to the international support for this approach:
I note that the courts of many other jurisdictions have found it necessary, in the context of orders against Internet abuses, to pronounce orders that have international effects. Several such cases are cited in the arguments of [International Federation of Film Producers Associations and International Federation of the Phonographic Industry], including APC v. Auchan Telecom, 11/60013, Judgment (28 November 2013) (Tribunal de Grande Instance de Paris); McKeogh v. Doe (Irish High Court, case no. 20121254P); Mosley v. Google, 11/07970, Judgment (6 November 2013) (Tribunal de Grande Instance de Paris); Max Mosley v. Google (see “Case Law, Hamburg District Court: Max Mosley v. Google Inc. online: Inform’s Blog and ECJ Google Spain SL, Google Inc. v. Agencia Española de Protección de Datos, Mario Costeja González, C-131/12 [2014], CURIA.[3]
[40] Fenlon J. explained why Equustek’s request that the order have worldwide effect was necessary as follows:
The majority of GW1000 sales occur outside Canada. Thus, quite apart from the practical problem of endless website iterations, the option Google proposes is not equivalent to the order now sought which would compel Google to remove the [Datalink] websites from all search results generated by any of Google’s websites worldwide. I therefore conclude that [Equustek does] not have an out-of-court remedy available to [it].[4]


... to be effective, even within Canada, Google must block search results on all of its websites.[5]
As a result, to ensure that Google did not facilitate Datalink’s breach of court orders whose purposes were to prevent irreparable harm to Equustek, she concluded that the injunction had to have worldwide effect.

[41] I agree. The problem in this case is occurring online and globally. The Internet has no borders — its natural habitat is global. The only way to ensure that the interlocutory injunction attained its objective was to have it apply where Google operates — globally. As Fenlon J. found, the majority of Datalink’s sales take place outside Canada. If the injunction were restricted to Canada alone or to, as Google suggests it should have been, the remedy would be deprived of its intended ability to prevent irreparable harm. Purchasers outside Canada could easily continue purchasing from Datalink’s websites, and Canadian purchasers could easily find Datalink’s websites even if those websites were de-indexed on Google would still be facilitating Datalink’s breach of the court’s order which had prohibited it from carrying on business on the Internet. There is no equity in ordering an interlocutory injunction which has no realistic prospect of preventing irreparable harm.

[42] The interlocutory injunction in this case is necessary to prevent the irreparable harm that flows from Datalink carrying on business on the Internet, a business which would be commercially impossible without Google’s facilitation. The order targets Datalink’s websites — the list of which has been updated as Datalink has sought to thwart the injunction — and prevents them from being displayed where they do the most harm: on Google’s global search results.

[43] Nor does the injunction’s worldwide effect tip the balance of convenience in Google’s favour. The order does not require that Google take any steps around the world, it requires it to take steps only where its search engine is controlled. This is something Google has acknowledged it can do — and does — with relative ease. There is therefore no harm to Google which can be placed on its “inconvenience” scale arising from the global reach of the order.

[44] Google’s argument that a global injunction violates international comity because it is possible that the order could not have been obtained in a foreign jurisdiction, or that to comply with it would result in Google violating the laws of that jurisdiction is, with respect, theoretical. As Fenlon J. noted, “Google acknowledges that most countries will likely recognize intellectual property rights and view the selling of pirated products as a legal wrong”.[6]

[45] And while it is always important to pay respectful attention to freedom of expression concerns, particularly when dealing with the core values of another country, I do not see freedom of expression issues being engaged in any way that tips the balance of convenience towards Google in this case. As Groberman J.A. concluded:
In the case before us, there is no realistic assertion that the judge’s order will offend the sensibilities of any other nation. It has not been suggested that the order prohibiting the defendants from advertising wares that violate the intellectual property rights of the plaintiffs offends the core values of any nation. The order made against Google is a very limited ancillary order designed to ensure that the plaintiffs’ core rights are respected.

.... the order in this case is an interlocutory one, and one that can be varied by the court. In the unlikely event that any jurisdiction finds the order offensive to its core values, an application could be made to the court to modify the order so as to avoid the problem.[7]
[46] If Google has evidence that complying with such an injunction would require it to violate the laws of another jurisdiction, including interfering with freedom of expression, it is always free to apply to the British Columbia courts to vary the interlocutory order accordingly. To date, Google has made no such application.

[47] In the absence of an evidentiary foundation, and given Google’s right to seek a rectifying order, it hardly seems equitable to deny Equustek the extraterritorial scope it needs to make the remedy effective, or even to put the onus on it to demonstrate, country by country, where such an order is legally permissible. We are dealing with the Internet after all, and the balance of convenience test has to take full account of its inevitable extraterritorial reach when injunctive relief is being sought against an entity like Google.

[48] This is not an order to remove speech that, on its face, engages freedom of expression values, it is an order to de-index websites that are in violation of several court orders. We have not, to date, accepted that freedom of expression requires the facilitation of the unlawful sale of goods.

5. Specific Performance and Real Estate

. Matthew Brady Self Storage Corporation v. InStorage Limited Partnership

In Matthew Brady Self Storage Corporation v. InStorage Limited Partnership (Ont CA, 2014) the Court of Appeal comments as follows on the criteria required for the court to award specific performance (ie. an Order for actual compliance with contractual obligations) as a remedy. The case involved a claim by a real estate vendor to complete the sale:
[29] In its essence, specific performance is a discretionary equitable remedy granted where damages cannot afford an adequate and just remedy in the circumstances. Almost 200 years ago, the principle was described by Sir John Leach, V.C., in Adderley v. Dixon (1824), 57 E.R. 239, at p. 240:
Courts of Equity decree the specific performance of contracts, not upon any distinction between realty and personalty, but because damages at law may not, in the particular case, afford a complete remedy. [Emphasis added.]
[30] Although specific performance is not in principle granted on the basis of any distinction between contracts for the sale of land and contracts involving personal property, until relatively recently that distinction has prevailed as a matter of course. That is because the law has traditionally viewed land as inherently unique such that damages could not sufficiently compensate its prospective purchaser.

[31] In Semelhago v. Paramadevan, 1996 CanLII 209 (SCC), [1996] 2 S.C.R. 415, the Supreme Court of Canada discarded that approach, however. The Court confirmed that specific performance was not to be available automatically as the default remedy for breach of a contract for the sale of lands “absent evidence that the property is unique to the extent that its substitute would not be readily available” or absent a fair, real and substantial justification for the claim to specific performance (at para. 22).

[32] Whether specific performance is to be awarded or not is therefore a question that is rooted firmly in the facts of an individual case. In Landmark of Thornhill Ltd. v. Jacobson (1995), 1995 CanLII 1004 (ON CA), 25 O.R. (3d) 628 (C.A.), at p. 636, this Court identified three factors bearing on the exercise of discretion in favour of specific performance: (i) the nature of the property involved; (ii) the related question of the inadequacy of damages as a remedy; and, (iii) the behaviour of the parties, having regard to the equitable nature of the remedy.

[33] What makes this case unusual is that it is the vendor rather than the purchaser seeking to have these factors reviewed in its favour. In such circumstances, damages will often be an adequate remedy. Indeed, there is a debate about whether the arguments in favour of granting specific performance to a vendor are weaker than those in favour of the purchaser: see Robert J. Sharpe, Injunctions and Specific Performance, looseleaf (Toronto: Canada Law Book, 2012), at paras. 8.100 to 8.220; Dick v. Dennis (1991), 20 R.P.R. (2d) 264 (Ont. Gen. Div.), at paras. 31-33.

[34] But it will not always be the case that damages are an adequate remedy where the vendor is the plaintiff, and there are authorities supporting the granting of specific performance in favour of a vendor: see, for example, Landmark of Thornhill; Dick v. Dennis, at para. 38; Westwood Plateau Partnership v. WSP Construction Ltd. (1997), 1997 CanLII 2085 (BC SC), 37 B.C.L.R. (3d) 82 (S.C.), at paras. 148-156, 163; and Comet Investments Ltd. v. Northwind Logging Ltd. (1998), 22 R.P.R. (3d) 294 (B.C. S.C.), at paras. 35-39.

[35] In an analogous context, where the claim relates to an investment property and any “unique” characteristics can be reflected in the sale price or profits from the investment and, therefore, give rise to quantifiable damages, courts have taken the position – following the approach taken in Semelhago – that there is no clear rule one way or the other as to whether specific performance is available. Its availability will turn on the uniqueness of the property and whether there is a fair, real and substantial justification for the claim. See, for example, John E. Dodge Holdings Ltd. v. 805062 Ontario Ltd. (2001), 2001 CanLII 28012 (ON SC), 56 O.R. (3d) 341 (S.C.), at para. 59, aff’d (2003), 2003 CanLII 52131 (ON CA), 63 O.R. (3d) 304 (C.A.), at paras. 37-39, 43-44, leave to appeal to S.C.C. refused, (2003) 223 D.L.R. (4th) vi; Monson v. West Barrhaven Developments Inc., [2000] O.J. No. 5209 (S.C.), at paras. 8-9; 1174538 Ontario Ltd. v. Barzel Windsor (1984) Inc. (1999), 29 R.P.R. (3d) 256 (S.C.), at paras. 7-8; 365733 Alberta Ltd. v. Tiberio, 2008 ABCA 341 (CanLII), 440 A.R. 177, at paras. 10-12.

[36] In our view, in the context of vendor claims – consistent with the approach taken in Semelhago – there is no absolute rule, one way or the other. The following passage from the Sharpe text, at paras. 7.210 and 7.220 is instructive:
Where the subject-matter of the contract is “unique”, a strong case can be made for specific performance. The more unusual the subject-matter of the contract, the more difficult it becomes to assess the plaintiff’s loss.

An award of damages presumes that the plaintiff’s expectation can be protected by a money award which will purchase substitute performance. If the item bargained for is unique, then there is no exact substitute. [Emphasis added.]
[37] Two considerations emerge from that passage. First, it is the subject-matter of the contract, not the land alone that must be unique or unusual. Second, the measure of the adequacy of a money award is whether it “will purchase substitute performance”. These considerations help shed light on the analysis where the vendor is the plaintiff.

[38] The “uniqueness” analysis in such circumstances has a slightly different focus than in the usual case where the purchaser seeks the remedy. There, the issue is whether the land itself has some peculiar or special value to the purchaser who is seeking to obtain it and whether there is a reasonable substitute readily available. That paradigm does not fit into the analysis as readily where the vendor seeks specific performance. In one sense, there is nothing “unique” about the property the vendor receives when such an order is made. The vendor receives the purchase price – the value of the land in money according to the contract.

[39] It does not follow, however, that there may not be uniqueness, or a special character, to the circumstances of the transaction – the subject-matter of the contract viewed more broadly – that will justify specific performance. Where the vendor seeks the remedy the focus should be on the transaction as a whole.
. 1465152 Ontario Limited v. Amexon Development Inc.

In 1465152 Ontario Limited v. Amexon Development Inc. (Ont CA, 2015) the Court of Appeal upheld a lower court permanent injunction against a landlord who was trying to obtain possession of leased commercial premises. On the key injunction criteria of whether failure to grant would cause irreparable harm to the applicant (ie. harm that was not compensable with a damage award), the court held that despite the modern judicial inclination to treat leases as any other contract, there was still a residual real property interest which could apply to avoid the irreparable harm rule. That is, the court acknowledged some remaining force in the previously conventional law that real estate entitlements could be subject to specific performance as of right:
[22] First, the Landlord contends that in Pointe East Windsor Limited v. Windsor (City), 2014 ONCA 467 (CanLII), 374 D.L.R. (4th) 380, at para. 17, this court held that equitable relief, such as a permanent injunction, is only available where damages are an inadequate remedy. The Landlord submits that the leased premises are not unique, so an award of compensatory damages to the Tenant would serve as an adequate remedy. However, in Pointe East Windsor Limited, the issue of remedy arose in the context of an action for breach of contract, not where the holder of an interest in property, such as the Tenant, was alleging a wrongful interference with a proprietary interest.

[23] As the law in Ontario currently stands, different considerations apply in the latter circumstance, as was explained in Robert J. Sharpe, Injunctions and Specific Performance, loose-leaf (consulted on 30 January 2015), (Toronto: Canada Law Book, 2014), at 4.10 and 4.20:
Where the plaintiff complains of an interference with property rights, injunctive relief is strongly favored. This is especially so in the case of direct infringement in the nature of trespass.

The reason for the primacy of injunctive relief is that an injunction more accurately reflects the substantive definition of property than does a damages award. It is the very essence of the concept of property that the owner should not be deprived without consent. An injunction brings to bear coercive powers to vindicate that right. Compensatory damages for a continuous and wrongful interference with a property interest offers only limited protection in that the plaintiff is, in effect, deprived of property without consent at an objectively determined price. Special justification is required for damages rather than an injunction if the principle of autonomous control over property is to be preserved. A damages award rather than an injunction permits the defendant to carry on interfering with the plaintiff’s property. [Footnotes omitted.]
[24] The Landlord relies on the decision of the British Columbia Court of Appeal in Evergreen Building Ltd. v. IBI Leaseholds Ltd., 2005 BCCA 583 (CanLII), 50 B.C.L.R. (4th) 250, leave to appeal to S.C.C. granted, [2006] S.C.C.A. No. 43,[1] in support of its position that the application judge should not have granted a permanent injunction. That case also involved an argument by a landlord that it should be permitted to re-enter leased premises in order to demolish a building for redevelopment even though the lease did not contain a demolition clause and the tenant had not breached the lease. The British Columbia Court of Appeal, at para. 31 of its reasons, held that the chambers judge had erred in granting a permanent injunction because he had treated the remedies related to a lease and a contract as “water-tight compartments”, leading him to ignore the issue of whether damages were an adequate remedy in the circumstances. The British Columbia Court of Appeal re-instated the interim injunction restraining the landlord from breaching the covenant of quiet enjoyment and remitted the issue of the permanent injunction back to the British Columbia Supreme Court for consideration of the equities between the parties.

[25] In the present case, the application judge turned his mind to the adequacy of an award of damages and then went on to observe, correctly, that “[i]njunctions remain a powerful arrow to preserve property rights and to restrain tortious misconduct.” The Landlord sought to trespass by seeking to enter the leased premises without any authority, terminate the Lease and demolish the leased premises. Under those circumstances it fell within the discretion of the application judge to restrain the Landlord from committing such a trespass, and I see no error in his exercise of that discretion.

[26] Second, the Landlord argues that the Tenant was seeking an injunction for an improper purpose, namely to enhance its bargaining position with the Landlord. Such a motivation, according to the Landlord, operated as a reason to deny granting an injunction. Certainly some courts have refused to grant an injunction where they have found that the request for injunctive relief was being used to force a hard bargain rather than protecting the actual enjoyment of bona fide property rights: Michael Santarsieri Inc. v. Unicity Mall Ltd. (1999), 1999 CanLII 5082 (MB CA), 181 D.L.R. (4th) 136 (Man. C.A.), at para. 25 and Denovan v. Lee (1989), 65 D.L.R. (4th) 103 (B.C.C.A.), at p. 106. In the present case, however, the application judge made no such finding of improper purpose on the part of the Tenant and, by contrast, found that the Landlord had engaged in tortious misconduct.

[27] Finally, the Landlord submits that the permanent injunction constituted a disproportionate remedy in the circumstances, arguing that it was unreasonable to permit the Tenant to continue to occupy premises which amounted to less than three per cent of the building’s total rental area when all other tenants had vacated the building. I would not accept that submission for two reasons. First, as pointed out in Injunctions and Specific Performance, at 4.590:
Where there is a direct interference with the plaintiff’s property constituting a trespass, the rule favoring injunctive relief is even stronger than in the nuisance cases. Especially where the trespass is deliberate and continuing, it is ordinarily difficult to justify the denial of a prohibitive injunction. A damages award in such circumstances amounts to an expropriation without legislative sanction … In trespass, there has been less concern than in nuisance with the problem of “extortion”. Even if the plaintiff is merely holding out for the highest possible price, and suffers no out-of-pocket loss because of the trespass, the courts have awarded injunctions. Such orders may be said to vindicate the plaintiff’s right to exploit the property for whatever it is worth to the defendant and prevent the defendant from circumventing the bargaining process. [Footnotes omitted.]
[28] In addition, the application judge balanced the parties’ respective interests and tailored the scope of the injunction to that which was necessary to restrain the specific unlawful conduct of the Landlord – i.e. its intention to trespass onto the leased premises pursuant to the Notice to Vacate in order to terminate the tenancy. His endorsement clearly states that the injunction would not protect the Tenant from the consequences of future breaches or future application of the Lease, nor did it address the issue of the right of the Tenant to renew the Lease upon the expiry of its current term on March 31, 2016.

Cases to be integrated

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