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The following is a copy of the original Factum filed by Ms. Fotherby with the Nova Scotia Court of Appeal in the matter of Fotherby v. Cowan, 2012 NSCA 59. This case is part of the story that depicts the neverending battle the Fotherby's have been subjected to in Nova Scotia while trying to promote sustainable education and trying to build an educational center so that average people can learn about the hidden alternative energy technologies. The courts turned this event into a landlord/tenant dispute and ignored the fact that the agreement in question was a contract where each party had obligations to the other. I thought it would be useful for anyone researching the case to have online access to "other side" of the story, rather than just the online court decision :)
2012 C.A.
No. 392849
IN
THE NOVA SCOTIA COURT OF APPEAL
BETWEEN:
LYNNE
FOTHERBY and BRILYN BED & BREAKFAST and NATURE TOURS
APPELLANTS
-
and -
BRENT
COWAN and TIFFANY PROPERTY VENTURES LIMITED
RESPONDENTS
FACTUM
OF THE APPELLANTS
Lynne
Fotherby Ezra B. van Gelder
5435
Highway 207 Cox & Palmer
Seaforth,
Nova Scotia 1959 Upper Water Street, Suite 1100
B0J
1N0 Purdy's Wharf Tower One
Halifax,
Nova Scotia B3J 3N2
Tel:
(902) 827-5921 Tel: (902) 421-6262
Fax:
(902) 827-5921 Fax: (902) 421-3130
TABLE
OF CONTENTS
Part
I: Introduction and Concise Statement of Facts 1-4
Part
II: List of the Issues 11-14
Part
III: Legal Argument 14-16
Part
IV: Order or relief sought, including any order as to costs 16-17
Appendix
A: List of citations referred to in Part III 17
Appendix
B: Statutes and Regulations 17
Part
I: Introduction and Concise Statement of Facts Page 1
Introduction
"All that is
necessary for evil to triumph is for good men to do nothing"
– Edmund
Burke
[[1] History is replete with examples of good men and women devoting their time, effort and finances to work on solutions to resolve issues that affect humanity. In this new era of global concern about social injustice, damage to the environment, and the survival of humanity itself, many of these men and women have taken it upon themselves to invest in the development of sustainable solutions and technologies such as wind, solar and alternative fuels and they are building the solutions rather than waiting for governments and corporations because they know that change whether it works on wall street or not, is necessary to ensure the survival of future generations. The Appellants are part of this group of men and women.
[2] Unlike some government/private corporations and the ever growing list of non profit philanthropists and their so called charities, these good men and women have more concern for humanity and the environment than they do for excessive wealth. Because they seek to educate others how to become less dependant on corporate structures, they are often put at significant financial, personal and physical risk by some of these corporations, their elite organizations and associates, who consistently make huge profits by manipulating markets, and profiting from population dependency and fear.
[3] The Courts have recognized time and again that to ensure democracy it is required that government, public institutions, business and corporations operate transparently, yet here in
Page 2
Canada, there are government/private partnerships that operate in a way that can only be compared to gang style, controlling market share and controlling what the public is allowed to know and when they are allowed to know it. They create suppression of education about sustainable solutions by blocking the information from our educational system, and by using the media to present incomplete or inaccurate information. Many people are not computer literate so they wouldn't be able to find the solutions online, others are so entrenched in believing they must follow the rules of society and not stray from the norm or they will be chastised so they will follow whatever they are told by the media that is controlled by corporations and the financial market. And then of course there are those who just don't care and think that everyone will eventually die and go to heaven or hell so don't worry about it..
[4] If there is money to be made in "going green" well this gang style group believes no one can have the solutions until they are poised to deliver them for their usual exorbitant price. A good example is a new house built in Dartmouth that is being touted as the best equilibrium home, yet looking closely you will see it is a 150,000 average house with 15,000 worth of solar products, not nearly as efficient as it could be for the asking price of 359,000. It is not priced this high because of it's worth, it priced this high because it is a symbol to the public that sustainability is out of their reach and they should just go back to paying for oil and gas.
[5] It is well known that the Province of Nova Scotia, is heavily invested in the fossil fuel industry and rather than move investments over to support local green efforts this group has been given full authority by government to use any tactics necessary to suppress any business
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or individual who attempts to provide the public a route to easy access, education and affordable products that can be used to replace fossil fuel.
[6] Other countries, "non NATO" countries are experiencing rapid growth and improvement in economy and public health, yet our government here in Canada seems to believe that moving away from fossil fuel is crazy and impossible. Rather than switch over to Wind, Solar and alternative fuels, we find that are skies are being sprayed with chemicals such as Aluminium and Barium, and we are told that this is our governments solution to global warming. They say they "think" that the heavy metals will reflect the suns rays away from the planet and that will keep the planet cool for another ten years so we can keep pumping fossil fuels.
[7] While the UN has banned the use of spraying chemicals in acts of war there is nothing to stop a private company or government from spraying chemicals on their own country. They give it names such as geo engineering, weather modification, weather manipulation, cloud seeding and a million others, and the names keep changing to prevent the public from finding out what is truly going on, to find out that we are being sprayed with toxic chemicals. Our country has been taken over by insane scientists, governments and corporations whose only concern is the bottom line and the control of market shares.
[8] In this Appeal, this Court will be called upon to decide whether they will allow this type of manipulation and deceit to continue or whether they allow the Appellants to their just right to a trial, and allow the Appellants to continue their work on the property in Ketch Harbour
Page 4
and build the Interpretive Center that is needed to provide access to information. The Court has the ability to allow the Appellant to finish their development of new Sustainable Community under their Sustainable Co-op plan that will provide opportunity for entrepreneurs to operate sustainable businesses.
[9] If the Court should decide otherwise then they will be making it acceptable for the tyranny to continue, and they will make it acceptable for the people of Nova Scotia to be forced to continue using toxic products and fossil fuels for another ten to twenty years.
Part I: Statement of facts
[10] Since 2006, the Appellants have invested heavily in the research, development and manufacturing of sustainable products and continues to provide information and education to the general public. Twice they have endeavoured to build an Interpretive Centre in the Province of Nova Scotia and twice their attempts have been thwarted by controlling government/private partnership corporations and their organized groups.
"Eastern Passage"
[11] The following concerns a different property in Eastern Passage but it is related because the issue of the Appellants business in Eastern Passage in 2006 became part of the Summary Judgment Hearing for this Ketch Harbour property. It is important that the Court of Appeal be aware of some related facts. In 2006, the Appellants agreed to purchase a property in Eastern Passage through a real estate sales agent, Richard Comeau of Exit Realty, Bedford office. The
Page 5
Appellants introduced the realtor to their alternative power solution designs, and their plans to renovate the building and enter it into the CMHC contest for Equilibrium Homes.
[12] The Appellants entered into agreement to lease the building temporarily while they applied for a mortgage that would cover the cost of the alternative power renovations and the purchase. The realtor offered to submit the mortgage application to a broker he knew.
[13] As the sustainable development plans of the Appellant became known to the local business community there began a series of events that all seemed to be directed at forcing the closure of the Appellant's business. The Appellant and her spouse many times were threatened by individuals connected with the government/private partnerships.
[14] In regards to the mortgage, the realtor said he gave the development plans to the mortgage broker but in the end it was found that he did not, and that resulted in a mortgage approval that would only cover the cost of the purchase, not the renovations. The Appellants were then forced to continue lease payments while they reapplied for the mortgage properly.
The Appellant was successful in getting the mortgage they needed but then when they tried to complete the purchase the Seller refused to sell the property and demanded that lease payments continue.
[15] When the Appellant objected to making more lease payments the Seller filed an action in Small Claims court against them. During the hearing the realtor Richard Comeau produced a document called a fee agreement. This agreement was signed by the realtor and the Sellers Page 6
and it said that the realtor and the Seller agree to keep the Appellants down payment. There was nothing in that document that stated the Appellant had agreed to pay the realtor a fee and it was never seen before or signed by the Appellants. In their findings the Small Claims Court
acknowledged that this document was questionable, and they questioned why the Realtor was keeping the Appellants down payment, but take they did not take any action because the issue at that time was not about the realtor's document.
[16] In the end the court treated the issue as if it was a landlord, tenant dispute, if the Seller did not want to sell then the Appellants should move out. No regards to the Appellants investment in the property and no regards to the losses suffered by the Appellants for not being able to purchase the building, complete their renovations and enter it into the CMHC Equilibrium Challenge.
[17] It should also be noted that part of the forced interruptions to the Appellants business was the matter of a tax audit that was called during the process of the hearing. This audit eventually turned out to be a deceitful attack on the Appellant and the short story is the auditor changed dates, figures and accounting information, denied two and a half years legitimate business expenses and froze the Appellants bank account. The Appellant was able to contact the Minister of Finance, prove the falsehood and have her account unfrozen immediately. The Appellant then took the matter to the Tax Court of Canada and received restitution. However again, the Tax Court acknowledged the "doings" of the auditor but again did nothing because the issue of how the auditor handled the audit was not related to the issue at hand.
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[18] The Appellant knows that the Respondent is connected to the very same people who worked to cause the collapse of the agreement in Eastern Passage and knows that these
attempts are meant to prevent the Appellant from ever creating an Interpretive Centre that could educate the population on alternative products they can build and install themselves.
"Ketch Harbour"
[19] In 2010, the Appellants met with the Respondents and through many conversations were enticed into believing that the Respondents had a keen interest in the Appellants plans to build an Interpretive Center as they had tried to do previously in Eastern Passage.
[20] On or about July 25, 2010 the Appellants entered into agreement with the Respondents concerning the property in Ketch Harbour, Nova Scotia. The property is the former Coast Guard Receiver Station. The Respondents purchased the property through a tax sale. It had been left abandoned and suffered extreme vandal and weather damage.
[21] The parties entered the agreement so that each could receive a return on their investments in the property. The Appellants would make monthly payments for a period of up to two years as they worked to clean and repair the damage from vandals and weather exposure and renovate the building. This would allow them to get an appraisal and secure a mortgage to complete the purchase by the end of the two year term. Under the agreement the Appellants also had rights to act as an agent and sell the property at any time. The Appellants had designed a property development plan that could have successfully increased the value of
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the property to over 1.2 million dollars and they were working towards this goal before the contract was interrupted.
[22] Many events of extreme nature occurred after the Appellants move in. As they were moving equipment and supplies into the building their vehicle that had been left in the driveway behind the locked gates was broken into and thieves made off with tools they had purchased for the clean up and repairs.
[23] Approximately one month after moving in there was a break in to the building and this time the thieves stole a larger quantity of tools leaving the Appellants to suffer a loss of approximately $6000.00 in tools.
[24] At nearly the same time the Appellants discovered that the basement was severely flooding every time there was a rainstorm. They were not aware of this problem until after they had moved building materials into the basement, and much those materials were destroyed by water damage. Another loss to the Appellants of approximately 2000.00. The flooding was found to be a problem with both the drainage around the side of the building and the drainage out to the septic system. It had been clogged because vandals had dumped the contents of fire extinguishers into the bathroom fixtures that eventually worked their way down through the system. The Appellants had to put off some of the basic repairs to spend days trying to clear the clogged drainage system so the basement would stop flooding.
[25] The Appellants kept the Respondents apprised of these things by email and in
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September they had to request a small delay in a payment so that they could repurchase the tools and get on with the renovations, get the heat and power connected and secure the building to prevent further damage. The Respondent agreed to the delay.
[26] The Appellants continued to work on installing power, heat and lights and worked to clean up the damaged building, spending hours on cleaning up toxic fire extinguisher spray and photo copier toner that had been dumped on the floors and in the bathroom fixtures. Almost every room in the 10,000 square foot building was coated with mould and mildew and had to be cleaned and fumigated. There was broken glass on the floors, broken doors and windows, broken locks and broken skylights and rotted wood around door and window frames. Between August 2010 and June 2011, the Appellant and her spouse and people who were hired to assist, spent numerous hours on these repairs.
[27] In the Agreement, the Appellants were responsible for paying property taxes. Prior to the agreement the Respondents had led the Appellants to believe that the property taxes would be about $2400 a year and that he would be appealing them as the property had not been assessed for many years. The Appellants had asked and it was agreed that they would be involved in the appeal because the work they did in the Sustainable industry qualified for many property tax breaks and incentives.
[28] The Respondent had received the tax bill about two months into the agreement.
The Appellant had asked numerous times to be kept informed on the tax situation and kept asking what the amount of the bill was. The Respondent refused to reveal the amount and the
Page 10
only response the Appellants received was that he had paid the bill and that it was going to be appealed. The Appellants even received a request to make ready for an assessor to visit the property but one never did.
[29] The Appellants had sent numerous emails to the Respondent inviting him to the property to view the progress and the plans they had created but the Respondent never arrived.
[30] On June 16, 2011 the Respondents put the tax bills in the fence and sent the Appellants an email demanding that they pay the property taxes immediately or he would force them out. This is when the Appellants first found out that the tax bill was over 7600.00 per year, not anywhere near the 2400.00 they were led to believe. Now they were being forced to pay this bill and the deferred payments immediately or vacate the premises and lose their investment of what was now over $69,000 for time, labour and materials purchased for the clean up, repair and renovations to the building.
[31] The Appellants requested a meeting with the Respondents, who did attend, but at this meeting he refused to make any negotiations, demanded payment in full or he would evict the Appellants.
[32] After the meeting the Appellants sent a registered letter to the respondent citing breaches of contract that the Respondent had obligation to remedy within 15 days. With the exception of some payments that had been agreed to be deferred with 10% interest, the
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Appellants kept up monthly payments until June 24, 2011 and when they received no remedy to the registered letter issues they filed an Action in the Supreme Court citing these breaches.
[33] The Respondent obtained counsel, there were numerous documents delivered to his counsel as evidence for discovery including every single email that had transpired between the parties. The Respondents council filed a defence and counterclaim, the Appellants filed a defence to the counterclaim. Shortly thereafter the Respondents council filed a motion for Summary Judgment.
[34] The Appellants who are self represented attempted to follow Civil Procedure Rules and brought forth evidence to the hearing that related only to issues that were in dispute such as the amounts owed. At the hearing the Appellant came to realize that the Summary Judgment hearing had turned into a mini trial that proceeded to try this case without having all the evidence presented especially the grouping of emails that would have proven the true facts of this case as they evolved and so the Respondents council was successful in defeating the Appellants at the Summary Judgment hearing and now the Appellants are seeking a trial and restitution for their damages.
Part II: List of Issues
[35] The first question that should be asked is did the Respondents have motive to force an end to the agreement and did he commit breaches to do so? What is the reason the Appellants feel so strongly that the Respondents breached the agreement. Well, to answer that we must look at a few simple facts. The Appellant had already agreed to purchase the property at the
Page 12
end of the two year term. The Respondent himself had suggested the Appellant take the term over two years so from this, one could calculate that he was not in any dire financial need to sell the property immediately and it should be noted he did purchase it at a tax sale for much
less than he was selling it to the Appellant. If the Appellant had to cover any unexpected costs during the term because of unexpected issues with the damaged building and arrangements had to be made to temporarily defer some payments, anything that was deferred and not cleared could easily have been paid out on closing at the end of the term if the Appellants were given the chance to complete the renovations without interference so there was no reason to force the agreement to end because of deferred monthly payments.
[36] The Appellants know that the Respondent discovered he could make more money off the property by getting out of the agreement and listing it on the market again. Just prior to the breaches a developer across the street from the property was clearing and selling lots rapidly at high prices. The land in the area was becoming a quick market. If the Appellants were forced to vacate that would give the Respondent the ability to earn more profit by selling the land to a higher bidder. There are two proofs of this, one being the new add on the kijiji website where the Respondent is selling the property at a higher price, and two that it is also listed now by Exit Realty, the same company that the realtor in the Eastern Passage issue belongs to. It is interesting to see now that Exit Realty is promoting their new Eco Broker Club and that their new slogan is ......Today's great leaders and entrepreneurs must look at environmental problems as an opportunity to set themselves apart from the competition."...
So in the midst of global warming, and all kinds of environmental issues the only thing that this
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company and all the others like it can come up with for solutions is how to make the most profit from the crisis. In fact there are many examples of crisis that were created on purpose by the governments and gov/private partnership corporations just so they could profit by offering pretend solutions.
[37] The next issue is to decide if the Learned Justice erred in his decision paragraph [32] when he stated that the Respondents had no obligation to advise the Appellants of the property tax details and when he made it seem that it was perfectly acceptable for the Respondents to hide the real amount of the taxes from the Appellants. To answer that, one only needs to look at the Agreement on page 5 that states "Property taxes will be paid as they become due as directed by the landlord upon presentation of the property tax bill." This statement proves that the Appellants had the right to know and the Respondents had the obligation to provide the correct information to the Appellants and keep them informed.
[38] The next issue is to decide is did the Learned Justice err when he decided that the parties did not have a fiduciary duty to each other? The answer to that lies in the Agreement itself, on the very first page that shows the intention and purpose of the entire agreement where it states..."drawn up as an agreement that will facilitate an investment solution for both parties..." This was no standard lease it was a contract, and whereas landlords and tenants in a standard lease may not have fiduciary obligations the parties to this agreement certainly did. Part of the proof is in the agreement statements about selling the property and sharing the proceeds, about rooms to be rented and and sublease payments shared 50/50. While the property was not sold and there were no rooms rented due to the renovations being halted by the Respondents actions these statements in this agreement still proves that the parties were in a "partnership" form of relationship, each with a fiduciary obligation to the other.
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[39] The next issue is to decide whether the Learned Justice erred in deciding that the Appellants did not have the right to withhold monthly payments? To answer this question one must consider the fact that the Appellant had arranged to defer some payments with 10% interest because of unexpected
losses they suffered during the break ins and the unforeseen problems with the building structure. The deferment was agreed and became part of the agreement. One must also consider that the Appellants kept all other payments up to date until such time as the Respondents breached the agreement when he presented the misquoted tax bills very late and demanded payments that were not yet due. The Appellants notified the Respondents in proper manner but the Respondents failed to work to remedy the problems within the required 15 days, in fact during a meeting the Respondents confirmed they would not work to remedy. Consider the fact that up to this time the Appellants had invested heavily to the tune of $69.000 into the work and materials to repair and renovate the building and the Agreement had a specific clause that allowed the Appellants to withhold further payments to recover their expenditures and take necessary steps to secure their investment in the contract, and they took these steps by immediately filing an Action.
Part III: Legal Argument
Negligent Misrepresentation, Breach of Contract
[40] The Learned Justice erred in his decision that the Respondent did not have any obligation to advise the Appellants of the property taxes. There is a precise term of agreement to the contrary on Page 5 of the agreement that the Learned Justice failed to recognize and it states "Property taxes will be paid as they become due as directed by the landlord upon presentation of the property tax bill." The Respondents had every obligation to keep the Appellants informed of the property tax situation no matter what. The Respondent knew that
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he had provided information to the Appellants before the agreement that indicated the property taxes would be about 2400.00 a year and when he received the tax bill two months after the agreement was signed he withheld that information from the Appellants. If the
Respondent had made a mistake in the beginning by quoting the wrong amount it could be forgiven. However there is no excuse for the Respondent to deceive the Appellant by hiding the real amount of the tax bill for about eight months. Furthermore, there is no excuse for the Respondent to say he is doing an appeal then pretend he is doing one by telling the Appellants to prepare for an assessor visit, and then just not do the appeal. And worse not even inform the Appellants that he had changed his mind so they could take alternative steps to remedy.
To make a false statement that results in an extreme financial increase in cost to the other party in a contract and knowing the statement is incorrect or finding out later that it was incorrect and not informing the other party immediately and work to remedy and save the contract, is both negligent misrepresentation and deceit. A trial is required to resolve the conflict.
[41] The Appellants were keeping up with the scheduled payments after the agreement to defer some initial payments with interest. The Respondents breached the contract by disrupting the Appellants business and investment opportunities when he demanded that the Appellants make payments for amounts that were not due and refusing to remedy the breach of misrepresentation and deceit regarding the taxes and forcing the Appellants to enact the Performance Clause of the Agreement, withhold payments beyond June 24, 2011 and seek restitution by way of a Supreme Court Action.
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Breach of Confidence, Breach of Fiduciary Duty
[42] The argument concerning the breaches of contract, confidence and fiduciary duty can all be addressed in a single paragraph. The Respondents had obligation to immediately inform
the Appellants of the amount of the tax bill and had the obligation to present them when due. The parties entered into this contract with the full intentions that it would be an investment tool for them both to receive a profit at the end of the term. In a contract where both parties rely on the other parties to keep their obligations there stands a duty for both parties to hold the other parties financial information in confidence and a duty that both parties act as fiduciaries for each other to endure the contract gets completed and to ensure both parties receive the benefits they expected when entering into the contract. Contracts and contract law are very important tools that can help in the improvement of our economic structure in this country and it should not be allowed for one party to break the contract and destroy the other parties ability to earn the benefits just because they found a way to earn bigger returns for themselves.
Part IV: Order or relief sought, including any order as to costs
The Appellants respectfully request:
(a) that the Appeal be allowed and a trial be scheduled;
(b) that the orders and decision of the Summary Judgment be rescinded;
(c) that the costs of the Summary Judgment be awarded to them;
(d) that the costs of the appeal be awarded to them;
(e) that they resume occupancy of the premises in Ketch Harbour to operate their business
and continue their plans to build the Interpretive Centre until a trial can be heard;
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(f) that they be given this right to occupancy under the terms that they will not be required to
make payments of any kind until they have been reimbursed for their expenses in an amount of 69,000 or until such time as the trial can be heard whichever comes first;
(g) that they be awarded an amount of $10,000 that is the amount of loss the Appellants suffered when they were unjustly evicted and the Respondents withheld their property;
(d) such further and other relief as this Honourable Court deems just.
Appendix A: List of citations referred to in Part III
(a) The Agreement between the Appellants and the Respondents
Appendix B: Statutes and Regulations
(a) Contract Laws of Nova Scotia: The law requires that parties to a contract exercise their
rights under that agreement honestly, fairly and in good faith.
All of which is respectfully submitted on August 31, 2012
by
_______________________________
Name Printed: Lynne Fotherby
The Appellants Self Represented
[2] Unlike some government/private corporations and the ever growing list of non profit philanthropists and their so called charities, these good men and women have more concern for humanity and the environment than they do for excessive wealth. Because they seek to educate others how to become less dependant on corporate structures, they are often put at significant financial, personal and physical risk by some of these corporations, their elite organizations and associates, who consistently make huge profits by manipulating markets, and profiting from population dependency and fear.
[3] The Courts have recognized time and again that to ensure democracy it is required that government, public institutions, business and corporations operate transparently, yet here in
Page 2
Canada, there are government/private partnerships that operate in a way that can only be compared to gang style, controlling market share and controlling what the public is allowed to know and when they are allowed to know it. They create suppression of education about sustainable solutions by blocking the information from our educational system, and by using the media to present incomplete or inaccurate information. Many people are not computer literate so they wouldn't be able to find the solutions online, others are so entrenched in believing they must follow the rules of society and not stray from the norm or they will be chastised so they will follow whatever they are told by the media that is controlled by corporations and the financial market. And then of course there are those who just don't care and think that everyone will eventually die and go to heaven or hell so don't worry about it..
[4] If there is money to be made in "going green" well this gang style group believes no one can have the solutions until they are poised to deliver them for their usual exorbitant price. A good example is a new house built in Dartmouth that is being touted as the best equilibrium home, yet looking closely you will see it is a 150,000 average house with 15,000 worth of solar products, not nearly as efficient as it could be for the asking price of 359,000. It is not priced this high because of it's worth, it priced this high because it is a symbol to the public that sustainability is out of their reach and they should just go back to paying for oil and gas.
[5] It is well known that the Province of Nova Scotia, is heavily invested in the fossil fuel industry and rather than move investments over to support local green efforts this group has been given full authority by government to use any tactics necessary to suppress any business
Page 3
or individual who attempts to provide the public a route to easy access, education and affordable products that can be used to replace fossil fuel.
[6] Other countries, "non NATO" countries are experiencing rapid growth and improvement in economy and public health, yet our government here in Canada seems to believe that moving away from fossil fuel is crazy and impossible. Rather than switch over to Wind, Solar and alternative fuels, we find that are skies are being sprayed with chemicals such as Aluminium and Barium, and we are told that this is our governments solution to global warming. They say they "think" that the heavy metals will reflect the suns rays away from the planet and that will keep the planet cool for another ten years so we can keep pumping fossil fuels.
[7] While the UN has banned the use of spraying chemicals in acts of war there is nothing to stop a private company or government from spraying chemicals on their own country. They give it names such as geo engineering, weather modification, weather manipulation, cloud seeding and a million others, and the names keep changing to prevent the public from finding out what is truly going on, to find out that we are being sprayed with toxic chemicals. Our country has been taken over by insane scientists, governments and corporations whose only concern is the bottom line and the control of market shares.
[8] In this Appeal, this Court will be called upon to decide whether they will allow this type of manipulation and deceit to continue or whether they allow the Appellants to their just right to a trial, and allow the Appellants to continue their work on the property in Ketch Harbour
Page 4
and build the Interpretive Center that is needed to provide access to information. The Court has the ability to allow the Appellant to finish their development of new Sustainable Community under their Sustainable Co-op plan that will provide opportunity for entrepreneurs to operate sustainable businesses.
[9] If the Court should decide otherwise then they will be making it acceptable for the tyranny to continue, and they will make it acceptable for the people of Nova Scotia to be forced to continue using toxic products and fossil fuels for another ten to twenty years.
Part I: Statement of facts
[10] Since 2006, the Appellants have invested heavily in the research, development and manufacturing of sustainable products and continues to provide information and education to the general public. Twice they have endeavoured to build an Interpretive Centre in the Province of Nova Scotia and twice their attempts have been thwarted by controlling government/private partnership corporations and their organized groups.
"Eastern Passage"
[11] The following concerns a different property in Eastern Passage but it is related because the issue of the Appellants business in Eastern Passage in 2006 became part of the Summary Judgment Hearing for this Ketch Harbour property. It is important that the Court of Appeal be aware of some related facts. In 2006, the Appellants agreed to purchase a property in Eastern Passage through a real estate sales agent, Richard Comeau of Exit Realty, Bedford office. The
Page 5
Appellants introduced the realtor to their alternative power solution designs, and their plans to renovate the building and enter it into the CMHC contest for Equilibrium Homes.
[12] The Appellants entered into agreement to lease the building temporarily while they applied for a mortgage that would cover the cost of the alternative power renovations and the purchase. The realtor offered to submit the mortgage application to a broker he knew.
[13] As the sustainable development plans of the Appellant became known to the local business community there began a series of events that all seemed to be directed at forcing the closure of the Appellant's business. The Appellant and her spouse many times were threatened by individuals connected with the government/private partnerships.
[14] In regards to the mortgage, the realtor said he gave the development plans to the mortgage broker but in the end it was found that he did not, and that resulted in a mortgage approval that would only cover the cost of the purchase, not the renovations. The Appellants were then forced to continue lease payments while they reapplied for the mortgage properly.
The Appellant was successful in getting the mortgage they needed but then when they tried to complete the purchase the Seller refused to sell the property and demanded that lease payments continue.
[15] When the Appellant objected to making more lease payments the Seller filed an action in Small Claims court against them. During the hearing the realtor Richard Comeau produced a document called a fee agreement. This agreement was signed by the realtor and the Sellers Page 6
and it said that the realtor and the Seller agree to keep the Appellants down payment. There was nothing in that document that stated the Appellant had agreed to pay the realtor a fee and it was never seen before or signed by the Appellants. In their findings the Small Claims Court
acknowledged that this document was questionable, and they questioned why the Realtor was keeping the Appellants down payment, but take they did not take any action because the issue at that time was not about the realtor's document.
[16] In the end the court treated the issue as if it was a landlord, tenant dispute, if the Seller did not want to sell then the Appellants should move out. No regards to the Appellants investment in the property and no regards to the losses suffered by the Appellants for not being able to purchase the building, complete their renovations and enter it into the CMHC Equilibrium Challenge.
[17] It should also be noted that part of the forced interruptions to the Appellants business was the matter of a tax audit that was called during the process of the hearing. This audit eventually turned out to be a deceitful attack on the Appellant and the short story is the auditor changed dates, figures and accounting information, denied two and a half years legitimate business expenses and froze the Appellants bank account. The Appellant was able to contact the Minister of Finance, prove the falsehood and have her account unfrozen immediately. The Appellant then took the matter to the Tax Court of Canada and received restitution. However again, the Tax Court acknowledged the "doings" of the auditor but again did nothing because the issue of how the auditor handled the audit was not related to the issue at hand.
Page 7
[18] The Appellant knows that the Respondent is connected to the very same people who worked to cause the collapse of the agreement in Eastern Passage and knows that these
attempts are meant to prevent the Appellant from ever creating an Interpretive Centre that could educate the population on alternative products they can build and install themselves.
"Ketch Harbour"
[19] In 2010, the Appellants met with the Respondents and through many conversations were enticed into believing that the Respondents had a keen interest in the Appellants plans to build an Interpretive Center as they had tried to do previously in Eastern Passage.
[20] On or about July 25, 2010 the Appellants entered into agreement with the Respondents concerning the property in Ketch Harbour, Nova Scotia. The property is the former Coast Guard Receiver Station. The Respondents purchased the property through a tax sale. It had been left abandoned and suffered extreme vandal and weather damage.
[21] The parties entered the agreement so that each could receive a return on their investments in the property. The Appellants would make monthly payments for a period of up to two years as they worked to clean and repair the damage from vandals and weather exposure and renovate the building. This would allow them to get an appraisal and secure a mortgage to complete the purchase by the end of the two year term. Under the agreement the Appellants also had rights to act as an agent and sell the property at any time. The Appellants had designed a property development plan that could have successfully increased the value of
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the property to over 1.2 million dollars and they were working towards this goal before the contract was interrupted.
[22] Many events of extreme nature occurred after the Appellants move in. As they were moving equipment and supplies into the building their vehicle that had been left in the driveway behind the locked gates was broken into and thieves made off with tools they had purchased for the clean up and repairs.
[23] Approximately one month after moving in there was a break in to the building and this time the thieves stole a larger quantity of tools leaving the Appellants to suffer a loss of approximately $6000.00 in tools.
[24] At nearly the same time the Appellants discovered that the basement was severely flooding every time there was a rainstorm. They were not aware of this problem until after they had moved building materials into the basement, and much those materials were destroyed by water damage. Another loss to the Appellants of approximately 2000.00. The flooding was found to be a problem with both the drainage around the side of the building and the drainage out to the septic system. It had been clogged because vandals had dumped the contents of fire extinguishers into the bathroom fixtures that eventually worked their way down through the system. The Appellants had to put off some of the basic repairs to spend days trying to clear the clogged drainage system so the basement would stop flooding.
[25] The Appellants kept the Respondents apprised of these things by email and in
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September they had to request a small delay in a payment so that they could repurchase the tools and get on with the renovations, get the heat and power connected and secure the building to prevent further damage. The Respondent agreed to the delay.
[26] The Appellants continued to work on installing power, heat and lights and worked to clean up the damaged building, spending hours on cleaning up toxic fire extinguisher spray and photo copier toner that had been dumped on the floors and in the bathroom fixtures. Almost every room in the 10,000 square foot building was coated with mould and mildew and had to be cleaned and fumigated. There was broken glass on the floors, broken doors and windows, broken locks and broken skylights and rotted wood around door and window frames. Between August 2010 and June 2011, the Appellant and her spouse and people who were hired to assist, spent numerous hours on these repairs.
[27] In the Agreement, the Appellants were responsible for paying property taxes. Prior to the agreement the Respondents had led the Appellants to believe that the property taxes would be about $2400 a year and that he would be appealing them as the property had not been assessed for many years. The Appellants had asked and it was agreed that they would be involved in the appeal because the work they did in the Sustainable industry qualified for many property tax breaks and incentives.
[28] The Respondent had received the tax bill about two months into the agreement.
The Appellant had asked numerous times to be kept informed on the tax situation and kept asking what the amount of the bill was. The Respondent refused to reveal the amount and the
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only response the Appellants received was that he had paid the bill and that it was going to be appealed. The Appellants even received a request to make ready for an assessor to visit the property but one never did.
[29] The Appellants had sent numerous emails to the Respondent inviting him to the property to view the progress and the plans they had created but the Respondent never arrived.
[30] On June 16, 2011 the Respondents put the tax bills in the fence and sent the Appellants an email demanding that they pay the property taxes immediately or he would force them out. This is when the Appellants first found out that the tax bill was over 7600.00 per year, not anywhere near the 2400.00 they were led to believe. Now they were being forced to pay this bill and the deferred payments immediately or vacate the premises and lose their investment of what was now over $69,000 for time, labour and materials purchased for the clean up, repair and renovations to the building.
[31] The Appellants requested a meeting with the Respondents, who did attend, but at this meeting he refused to make any negotiations, demanded payment in full or he would evict the Appellants.
[32] After the meeting the Appellants sent a registered letter to the respondent citing breaches of contract that the Respondent had obligation to remedy within 15 days. With the exception of some payments that had been agreed to be deferred with 10% interest, the
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Appellants kept up monthly payments until June 24, 2011 and when they received no remedy to the registered letter issues they filed an Action in the Supreme Court citing these breaches.
[33] The Respondent obtained counsel, there were numerous documents delivered to his counsel as evidence for discovery including every single email that had transpired between the parties. The Respondents council filed a defence and counterclaim, the Appellants filed a defence to the counterclaim. Shortly thereafter the Respondents council filed a motion for Summary Judgment.
[34] The Appellants who are self represented attempted to follow Civil Procedure Rules and brought forth evidence to the hearing that related only to issues that were in dispute such as the amounts owed. At the hearing the Appellant came to realize that the Summary Judgment hearing had turned into a mini trial that proceeded to try this case without having all the evidence presented especially the grouping of emails that would have proven the true facts of this case as they evolved and so the Respondents council was successful in defeating the Appellants at the Summary Judgment hearing and now the Appellants are seeking a trial and restitution for their damages.
Part II: List of Issues
[35] The first question that should be asked is did the Respondents have motive to force an end to the agreement and did he commit breaches to do so? What is the reason the Appellants feel so strongly that the Respondents breached the agreement. Well, to answer that we must look at a few simple facts. The Appellant had already agreed to purchase the property at the
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end of the two year term. The Respondent himself had suggested the Appellant take the term over two years so from this, one could calculate that he was not in any dire financial need to sell the property immediately and it should be noted he did purchase it at a tax sale for much
less than he was selling it to the Appellant. If the Appellant had to cover any unexpected costs during the term because of unexpected issues with the damaged building and arrangements had to be made to temporarily defer some payments, anything that was deferred and not cleared could easily have been paid out on closing at the end of the term if the Appellants were given the chance to complete the renovations without interference so there was no reason to force the agreement to end because of deferred monthly payments.
[36] The Appellants know that the Respondent discovered he could make more money off the property by getting out of the agreement and listing it on the market again. Just prior to the breaches a developer across the street from the property was clearing and selling lots rapidly at high prices. The land in the area was becoming a quick market. If the Appellants were forced to vacate that would give the Respondent the ability to earn more profit by selling the land to a higher bidder. There are two proofs of this, one being the new add on the kijiji website where the Respondent is selling the property at a higher price, and two that it is also listed now by Exit Realty, the same company that the realtor in the Eastern Passage issue belongs to. It is interesting to see now that Exit Realty is promoting their new Eco Broker Club and that their new slogan is ......Today's great leaders and entrepreneurs must look at environmental problems as an opportunity to set themselves apart from the competition."...
So in the midst of global warming, and all kinds of environmental issues the only thing that this
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company and all the others like it can come up with for solutions is how to make the most profit from the crisis. In fact there are many examples of crisis that were created on purpose by the governments and gov/private partnership corporations just so they could profit by offering pretend solutions.
[37] The next issue is to decide if the Learned Justice erred in his decision paragraph [32] when he stated that the Respondents had no obligation to advise the Appellants of the property tax details and when he made it seem that it was perfectly acceptable for the Respondents to hide the real amount of the taxes from the Appellants. To answer that, one only needs to look at the Agreement on page 5 that states "Property taxes will be paid as they become due as directed by the landlord upon presentation of the property tax bill." This statement proves that the Appellants had the right to know and the Respondents had the obligation to provide the correct information to the Appellants and keep them informed.
[38] The next issue is to decide is did the Learned Justice err when he decided that the parties did not have a fiduciary duty to each other? The answer to that lies in the Agreement itself, on the very first page that shows the intention and purpose of the entire agreement where it states..."drawn up as an agreement that will facilitate an investment solution for both parties..." This was no standard lease it was a contract, and whereas landlords and tenants in a standard lease may not have fiduciary obligations the parties to this agreement certainly did. Part of the proof is in the agreement statements about selling the property and sharing the proceeds, about rooms to be rented and and sublease payments shared 50/50. While the property was not sold and there were no rooms rented due to the renovations being halted by the Respondents actions these statements in this agreement still proves that the parties were in a "partnership" form of relationship, each with a fiduciary obligation to the other.
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[39] The next issue is to decide whether the Learned Justice erred in deciding that the Appellants did not have the right to withhold monthly payments? To answer this question one must consider the fact that the Appellant had arranged to defer some payments with 10% interest because of unexpected
losses they suffered during the break ins and the unforeseen problems with the building structure. The deferment was agreed and became part of the agreement. One must also consider that the Appellants kept all other payments up to date until such time as the Respondents breached the agreement when he presented the misquoted tax bills very late and demanded payments that were not yet due. The Appellants notified the Respondents in proper manner but the Respondents failed to work to remedy the problems within the required 15 days, in fact during a meeting the Respondents confirmed they would not work to remedy. Consider the fact that up to this time the Appellants had invested heavily to the tune of $69.000 into the work and materials to repair and renovate the building and the Agreement had a specific clause that allowed the Appellants to withhold further payments to recover their expenditures and take necessary steps to secure their investment in the contract, and they took these steps by immediately filing an Action.
Part III: Legal Argument
Negligent Misrepresentation, Breach of Contract
[40] The Learned Justice erred in his decision that the Respondent did not have any obligation to advise the Appellants of the property taxes. There is a precise term of agreement to the contrary on Page 5 of the agreement that the Learned Justice failed to recognize and it states "Property taxes will be paid as they become due as directed by the landlord upon presentation of the property tax bill." The Respondents had every obligation to keep the Appellants informed of the property tax situation no matter what. The Respondent knew that
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he had provided information to the Appellants before the agreement that indicated the property taxes would be about 2400.00 a year and when he received the tax bill two months after the agreement was signed he withheld that information from the Appellants. If the
Respondent had made a mistake in the beginning by quoting the wrong amount it could be forgiven. However there is no excuse for the Respondent to deceive the Appellant by hiding the real amount of the tax bill for about eight months. Furthermore, there is no excuse for the Respondent to say he is doing an appeal then pretend he is doing one by telling the Appellants to prepare for an assessor visit, and then just not do the appeal. And worse not even inform the Appellants that he had changed his mind so they could take alternative steps to remedy.
To make a false statement that results in an extreme financial increase in cost to the other party in a contract and knowing the statement is incorrect or finding out later that it was incorrect and not informing the other party immediately and work to remedy and save the contract, is both negligent misrepresentation and deceit. A trial is required to resolve the conflict.
[41] The Appellants were keeping up with the scheduled payments after the agreement to defer some initial payments with interest. The Respondents breached the contract by disrupting the Appellants business and investment opportunities when he demanded that the Appellants make payments for amounts that were not due and refusing to remedy the breach of misrepresentation and deceit regarding the taxes and forcing the Appellants to enact the Performance Clause of the Agreement, withhold payments beyond June 24, 2011 and seek restitution by way of a Supreme Court Action.
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Breach of Confidence, Breach of Fiduciary Duty
[42] The argument concerning the breaches of contract, confidence and fiduciary duty can all be addressed in a single paragraph. The Respondents had obligation to immediately inform
the Appellants of the amount of the tax bill and had the obligation to present them when due. The parties entered into this contract with the full intentions that it would be an investment tool for them both to receive a profit at the end of the term. In a contract where both parties rely on the other parties to keep their obligations there stands a duty for both parties to hold the other parties financial information in confidence and a duty that both parties act as fiduciaries for each other to endure the contract gets completed and to ensure both parties receive the benefits they expected when entering into the contract. Contracts and contract law are very important tools that can help in the improvement of our economic structure in this country and it should not be allowed for one party to break the contract and destroy the other parties ability to earn the benefits just because they found a way to earn bigger returns for themselves.
Part IV: Order or relief sought, including any order as to costs
The Appellants respectfully request:
(a) that the Appeal be allowed and a trial be scheduled;
(b) that the orders and decision of the Summary Judgment be rescinded;
(c) that the costs of the Summary Judgment be awarded to them;
(d) that the costs of the appeal be awarded to them;
(e) that they resume occupancy of the premises in Ketch Harbour to operate their business
and continue their plans to build the Interpretive Centre until a trial can be heard;
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(f) that they be given this right to occupancy under the terms that they will not be required to
make payments of any kind until they have been reimbursed for their expenses in an amount of 69,000 or until such time as the trial can be heard whichever comes first;
(g) that they be awarded an amount of $10,000 that is the amount of loss the Appellants suffered when they were unjustly evicted and the Respondents withheld their property;
(d) such further and other relief as this Honourable Court deems just.
Appendix A: List of citations referred to in Part III
(a) The Agreement between the Appellants and the Respondents
Appendix B: Statutes and Regulations
(a) Contract Laws of Nova Scotia: The law requires that parties to a contract exercise their
rights under that agreement honestly, fairly and in good faith.
All of which is respectfully submitted on August 31, 2012
by
_______________________________
Name Printed: Lynne Fotherby
The Appellants Self Represented
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