Overview:
The dispute concerned a real estate transaction involving NV Highway Properties Ltd. and Catalina Facilities Rental Properties Ltd. (appellants) and 1155204 B.C. Ltd. and 1172111 B.C. Ltd. (respondents). The agreement included an option for the respondents to purchase shares in the seller companies. After paying a $1.25 million deposit, the respondents refused to complete the transaction, alleging that the contract was unenforceable.

Legal Issues:

1. Whether the nemo dat quod non habet principle rendered the contract unenforceable because the appellants did not own the shares to be transferred.
2. Whether the appellants were ready, willing, and able to perform their obligations under the contract at closing.

Court's Decision:
The British Columbia Court of Appeal found that the nemo dat rule did not apply to invalidate the contract, as it governs property rights, not the enforceability of contracts. The appellants were deemed capable of transferring the shares and fulfilling the agreement. The Court also rejected the respondents’ argument that the appellants were not ready to complete the transaction.

Outcome:
The appeal was allowed, and the respondents’ action for the return of the $1.25 million deposit was dismissed. The appellants were entitled to retain the deposit as liquidated damages under the contract.