Background: Bonnie West, the sole director of 10031695 Manitoba Ltd. (1003), and Glenn Karr, the sole director of 72230 Manitoba Ltd. (722), were former spouses who entered into lease and option agreements for a commercial property on Academy Road. After their separation, disputes arose over the ownership and lease agreements of the property.

Legal Issues: The court examined whether 1003 made full and fair disclosure in obtaining a pending litigation order (PLO) without notice to 722. It also evaluated the validity of the first option agreement allowing 1003 to purchase the property, considering its status after the separation agreement and 1003’s lease default. The court addressed whether 1003 had a right to specific performance, meaning the right to purchase the property despite defaulting on lease payments. The validity and removal of caveats registered against the property, as well as the discharge of the PLO, were also contested.

Held: The Senior Associate Judge concluded that 1003 made sufficient disclosure during the ex parte motion and that a triable issue existed regarding 1003’s right to specific performance. The appeal court concurred, maintaining the PLO but suggested that 50% of the sale price be held in trust if the property were sold. The court determined that damages were an adequate remedy for 1003’s claims.

Costs: The appeal of the defendant, 72230 Manitoba Ltd., was dismissed with costs awarded to the plaintiff, 10031695 Manitoba Ltd., based on the applicable tariff. Financial terms were not specified.