FW: Reef Island Development

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3 Forbes, Laurie From: Sent: To: Subject: Allen, Rian February :07 AM Forbes, Laurie FW: Reef Island Development From: Mary Hughes Sent: February :36 PM To: Pink, David; Allen, Rian; Furniss, Donald; Ledger, Terry; Nishikawa, Ruth-Ellen; Currie, Sandy; Hayes, Donelda; Edwards, Allen; Barrick-Spearn. Linda; McTaggart, Gault; Harding, Phil; Baranik, Jean-Ann Subject: Reef Island Development To the Mayor and Councillors, As a long time cottager in Muskoka, I have witnessed far too many undesirable and destructive changes around our lake. This proposal is one more example of an excessively large building on a modestly sized piece of property. It is disturbing to see this application only two days before it comes before council. I object in principle to another enormous dwelling going up on a small island. There are insufficient safeguards to prevent light pollution, destruction of fish habitat, and destruction of trees and vegetation. Having read the Staff Report I accept that if severed, what the proponent proposes is largely in compliance with various Official Plans. However, it seems to me that an application to sever would be the appropriate first step in developing this island. I note that the proposals re new docks and boathouses exceed the permitted widths by a significant percentage, and also a large deck space over water is proposed which does not comply. One assumes that designs could be modified to comply with Official Plans. Prior to severance, the excess dock width is enormous. The concerns about steep slopes are considered, but I see no requirement to retain trees and vegetation. Until and unless there is a severance, this application should be denied as it contravenes too many clauses in the Official Plans to list, but I will attempt it: In the District OP, D. 17 and K. 60, and in the Township OP, Sections B 2.4, B. 4.18, B 5.2, B5.7, B10.3, B10.7, and B Why has the applicant not attempted to obtain a severance in advance of this application? It is my opinion that this application should be denied, and that the applicant be required or requested to obtain a severance of Reef Island into two lots before proceeding further. If this application is approved at this time, through the fastest tracking system I have ever seen first, second and third reading in one meeting??? - what assurances does Council have that he will proceed to a severance. -- 1

4 Mary Hughes 122 Woodhall Place, Salt Spring Island, BC V8K 2W8 and 2

5 Forbes, Laurie From: Sent: To: Subject: Allen, Rian February :07 AM Forbes, Laurie FW: Patrick dovigi proposed bylaw Amendment application From: Rachel Sent: February :19 PM To: Pink, David; Allen, Rian; Furniss, Donald; Cc: Hayes, Donelda; Edwards, Allen; Barrick-Spearn. Linda; Harding, Phil; Baranik, Jean-Ann; Ledger, Terry; Currie, Sandy Subject: Patrick dovigi proposed bylaw Amendment application Dear Mayor Furniss, Councillors and Planning Department staff, I am a cottager on Lake Joseph whose cottage faces another property developed by Mr. Dovigi.(Star Island) I am sending you this to voice my strong opposition to the proposed Zoning Bylaw Amendment application by PJD Properties (Patrick Dovigi) for Reef Island on Lake Joseph. I have had the opportunity to review the Agenda Package for the council meeting scheduled for Friday February 17th, and I am very concerned with this proposed development. Allowing excessive developments like this one proposed by Mr. Dovigi sets a very bad precedent for our area, and will serve to further erode the natural beauty of our lakes. The proposed combination of the existing structures (4,900 square foot cottage and 3 slip boathouse) and the proposed new structures (2 new boathouses and a 7,800!!! square foot cottage) is beyond excessive. The previous owners of the island (the Allison's) did a wonderful job of developing the property to make it very usable, but also to preserve as much of the natural landscape as possible. The current development of Reef Island is representative of what Muskoka "is" and what it "should be". The newly proposed development by Mr. Dovigi should NOT be allowed to proceed. The proposal is far in excess of the allowable limits of our bylaw, and there is no justification to allow this development. I am asking you to vote NO to the zoning bylaw amendment application of PJD Properties for Reef Island. Thank you for your time and consideration. Respectfully, Rachel Schneiderman 1

6 Forbes, Laurie From: Sent: To: Cc: Subject: Attachments: Diana van Vliet February :55 AM Forbes, Laurie Leonard Latchman Re: Application ZBA-65/16 Leonard Latchman Elsinore.pdf As per attached., on behalf of Leonard Latchman Thank you, Diana Diana van Vliet LDL Corp tel (416) fax(416)

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11 February 15th 2017 To Council for the Township of Muskoka Lakes, My name is Barry Goldberg. I cottage at Hemlock Hill Road, Township of Muskoka Lakes, District of Muskoka. I have viewed the proposed site plan for Reef Island and I understand the proposed variances and their reasons for requesting them. This is a unique situation and when you consider the size of the island and location of the proposed cottage and boathouses, the development will be appropriately spread out throughout the island and not dominate the shoreline. We have no concerns with the application and would agree with a favourable decision from Council. Thanks, 7; Barry & Janice Goldberg

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13 Forbes, Laurie From: Sent: To: Cc: Subject: Attachments: Anne McCauley February :38 PM Furniss, Donald; Nishikawa, Ruth-Ellen; Currie, Sandy; Hayes, Donelda; Edwards, Allen; Harding, Phil; McTaggart, Gault; Barrick-Spearn. Linda; Ledger, Terry; Mortimer, Cheryl; Forbes, Laurie; Pink, David Summer Valentine Council Agenda item 7.c.2 PJD Properties Inc, Reef Island Letter to Twp Muskoksa Lakes re PJD properties Feb 16, 2017.docx Please find attached for your consideration a letter from the MLA with respect to the zoning by-law amendment application for PJD Properties Inc Anne McCauley Chair of the political and land use committee Muskoka Lakes Association 1

14 February 17, 2017 Mayor and Members of Council Township of Muskoka Lakes 1 Bailey Street, PO Box 129 Port Carling, Ontario P0B 1J0 Dear Mr. Mayor and Members of Council: Re: PJD Properties Inc Reef Island, Lake Joseph Zoning by-law amendment application ZBA-65/16 The Muskoka Lakes Association (MLA) agrees with the Township s strategic plan action statement Environment First. We believe that the natural environment of Muskoka must be preserved; that is what drives its economy. We believe that council agrees. Two years ago, this council approved a new zoning by-law. By-law reinforced the belief that development on the waterfront in Muskoka needs careful regulation to ensure that the natural environment is protected and maintained. The new by-law restated that one dwelling unit per lot is permitted in a waterfront residential zone. Development standards were also provided as to the minimum size of a lot and its frontage. But NONE stated that one waterfront lot may have two dwelling units. The staff report makes reference to a policy in the plan that proposes consideration of whether the registered lot could be severed into two or more lots. While consideration can be given as to the property s potential to be subdivided, it remains one lot, one dwelling unit. If two dwelling units are desired the appropriate procedure would be to create two separate lots through approval of a consent application, not try to get two dwelling units through the back door. By-law also limits the width and length of shoreline structures docks and boathouses to a maximum of 75 ft in recognition of policies in both the District Official Plan and the Townships Official Plan which state that maintenance of the shoreline of lakes and rivers is key to preserving the quality of the natural and cultural heritage of Muskoka, within the waterfront designation where development is proposed, a natural substantially undisturbed buffer is recommended at the water s edge. The proposed zoning by-law would permit a cumulative dock width of 224 feet! Not 75 feet! The staff report notes other inconsistencies with good planning and consideration of environmental preservation, including protection of fish habitat, setback from an environmental protection zone, the presence of steep slopes and forested areas on the

15 island which may be destroyed or compromised and a concern about the appropriate siting of two septic systems. Two years ago, this council had a similar application, Sirachi Investments ltd ( Genovese) on Lake Rousseau. That application also requested overdevelopment of its shoreline while acknowledging that the existing shoreline structures exceeded the permitted width by over 200 ft. That application was referred to the OMB but when the applicant realized that the chances of winning at the OMB were slim, he withdrew his application. The MLA believes that the PDJ Properties Inc zoning by-law amendment should be refused as it would allow development that is inappropriate in Muskoka. Council needs to send a strong message that it will not permit overdevelopment of its waterfront; that the natural environment will be preserved to sustain Muskoka s economy; and that applications requesting over development will be refused. Thank you for your consideration. The MLA requests that a recorded vote be taken on this application. The MLA also respectfully requests a copy of the minutes of this meeting and a copy of council s decision. Yours respectfully, Anne McCauley Chair Political & Land Use, MLA Bob Ensor President, MLA MLA re PJD Properties Inc ZBA 65/16 February 17, 2017 Page 2

16 Forbes, Laurie From: Sent: To: Subject: Attachments: Courtis, Trevor A <TCOURTIS@mccarthy.ca> February :33 AM Forbes, Laurie Zoning Amendment Application - By-law , ZBA-65/16, PJD Properties Inc., Reef Island, (Medora), Roll # 4 LT_Council_req_deferral_of_application_by_PJD_Properties_Inc -_Feb pdf Ms. Forbes, Further to our conversation yesterday afternoon, I have attached my letter which was sent to members of Council yesterday for inclusion in the Meeting Minutes. Please let me know if I can provide any further information. Regards, Trevor Courtis Associate Sociétaire Litigation Litige T: C: F: E: tcourtis@mccarthy.ca McCarthy Tétrault LLP Suite 5300 TD Bank Tower Box 48, 66 Wellington Street West Toronto ON M5K 1E6 Please, think of the environment before printing this message. This may contain information that is privileged, confidential and/or exempt from disclosure. No waiver whatsoever is intended by sending this which is intended only for the named recipient(s). Unauthorized use, dissemination or copying is prohibited. If you receive this in error, please notify the sender and destroy all copies of this . Our privacy policy is available at Click here to unsubscribe from commercial electronic messages. Please note that you will continue to receive non-commercial electronic messages, such as account statements, invoices, client communications, and other similar factual electronic communications. Suite 5300, TD Bank Tower, Box 48, 66 Wellington Street West, Toronto, ON M5K 1E6 1

17 McCarthy Tétrault LLP PO Box 48, Suite 5300 Toronto-Dominion Bank Tower Toronto ON M5K 1E6 Canada Tel: Fax: Trevor A Courtis Direct Line: (416) Direct Fax: (416) Assistant: Lina Accardo Direct Line: naccardo@mccarthy.ca February 16, 2017 Via and Courier Council of the Township of Muskoka Lakes P.O. Box Bailey St. Port Carling ON P0B 1J0 Dear Members of Council: Re: Zoning Amendment Application By-law , ZBA-65/16, PJD Properties Inc., Reef Island, (Medora), Roll # We appreciate the opportunity to comment on the application that will be made at a Regular Meeting of Council of the Township of Muskoka Lakes on February 17, 2017 for a Zoning Bylaw Amendment identified on the Council Meeting Agenda as By-law , ZBA-65/16, PJD Properties Inc., Reef Island, (Medora), Roll # Jason Claxton and Ontario Inc. ( 254 ) are the proper owners of the Reef Island property pursuant to an Assignment Agreement that was breached by PJD Properties Inc. ( PJD ) and Patrick Dovigi. Mr. Claxton and 254 have commenced an action in the Ontario Superior Court of Justice bearing Court File No. CV wherein they are seeking, among other things, an order for specific performance compelling PJD to transfer the Reef Island property to 254. Mr. Claxton and 254 will be making a motion to the Court seeking, inter alia, the following relief that is necessary to preserve the status quo pending the resolution of this dispute: 1. An Order that a Certificate of Pending Litigation be issued against the Reef Island property; and 2. An interim and interlocutory Order prohibiting the Defendants from applying for, or making any modifications to the Reef Island property that would require an application for: (a) a Minor Variance or Zoning By-Law Amendment pursuant to By-law No (Zoning) of the Township of Muskoka Lakes, or its predecessor or successor legislation; (b) a Permit pursuant to By-law No (Site Alteration) of the Township of Muskoka Lakes, or its predecessor or successor legislation; MT DOCS

18 page 2 (c) a Permit pursuant to By-law No (Tree Preservation) of the Township of Muskoka Lakes, or its predecessor or successor legislation; or (d) A permit pursuant to Building Code, O. Reg. 332/12; and 3. A mandatory Order that the Defendants shall withdraw, retract or otherwise cancel any applications referred to under paragraph (2) made prior to the date of said Order that remain pending. A copy of the Statement of Claim and Notice of Motion which describes the title claim of Mr. Claxton and 254 and their entitlement to this interim relief is enclosed for your consideration. We do not anticipate that this motion will be heard prior to the Council Meeting on Friday. In these circumstances, Mr. Claxton and 254 respectfully request that Council defer consideration of the application filed by PJD until the dispute regarding ownership to the Reef Island property is resolved. The application contemplates a significant alteration of the property. If Council were to decide to grant the application, it would cause significant prejudice to Mr. Claxton and 254 s ability to apply for a minor variance in the future if they are successful in their action against PJD and Mr. Dovigi. Pursuant to section 45(1.3) of the Planning Act, RSO 1990, c. P.13, which came into force recently on July 1, 2016, once a by-law amendment is granted in response to an application by the owner of that land, all persons are precluded from applying for a minor variance with respect to that land for two years. The legislative provisions read: Planning Act, RSO 1990, c P.13 When subs. (1.3) applies 45. (1.2) Subsection (1.3) applies when a by-law is amended in response to an application by the owner of any land, building or structure affected by the by-law, or in response to an application by a person authorized in writing by the owner. Two-year period, no application for minor variance 45. (1.3) Subject to subsection (1.4), no person shall apply for a minor variance from the provisions of the by-law in respect of the land, building or structure before the second anniversary of the day on which the by-law was amended. Exception 45. (1.4) Subsection (1.3) does not apply in respect of an application if the council has declared by resolution that such an application is permitted, which resolution may be made in respect of a specific application, a class of applications or in respect of such applications generally. Mr. Claxton and 254 respectfully submit that a deferral is necessary and appropriate to preserve the status quo. MT DOCS Council of the Township of Muskoka Lakes - February 16, 2017

19 page 3 We hope that this letter and the enclosures will be helpful in considering this application. Please let us know if we can provide any further information. Yours truly, McCarthy Tétrault LLP Per: Trevor A Courtis TAC/na Enclosure c: Geoff R. Hall MT DOCS Council of the Township of Muskoka Lakes - February 16, 2017

20 BETWEEN: SUPERIOR COURT Of JUSTiCE ONTARIO LEGAL AID OFFICE. FEES. LEGAL AID MAY BE AVAILABLE TO YOU BY CONTACTING A LOCAL YOU WISH TO DEFEND TI-uS PROCEEDING BUT ARE UNABLE TO PAY LEGAL AGAINST YOU IN YOUR ABSENCE AND WITHOUT FURTHER NOTICE TO YOU. IF IF YOU FAIL TO DEFEND THIS PROCEEDING, JUDGMENT MAY BE GIVEN to ten more days within which to serve and file your statement of defence. intent to defend in Form 1 83 prescribed by the Rules of Civil Procedure. This will entitle you Instead of serving and filing a statement of defence, you may serve and file a notice of served outside Canada and the United States of America, the period is sixty days. America. the period for serving and filing your statement of defence is forty days. If you are If you are served in another province or territory of Canada or in the United States of for you must prepare a statement of defence in Form 1 8A prescribed by the Rules of Civil office, WITI-IIN TWENTY DAYS after this statement of claim is served on you, if you are served in Ontario. Procedure, serve it on the plaintiffs lawyer and file it, with proof of service, in this court IF YOU WISH TO DEFEND THIS PROCEEDING, you or an Ontario lawyer acting plaintiffs. The claim made against you is set out in the following pages. A LEGAL PROCEEDING HAS BEEN COMMENCED AGAINST YOU by the TO THE DEFENDANT STATEMENT OF CLAIM Defendants PJD PROPERTIES INC. AND PATRICK DOVIGI - and - Plaintiffs ONTARIO INC. AND JASON CLAXTON Court File No.

21 &Vfl TAKE NOTICE: THIS ACTION WILL AUTOMATICALLY BE DISMISSED if it has not been set down for trial or terminated by any means within five years after the action was commenced unless otherwise ordered by the court. Date: February 2017 Issued by Address of court office 393 University Avenue Toronto, ON M5G 1E6 TO: AND TO: PJD PROPERTIES INC. do Peter F.C. Howard Stikeman Elliott LLP Barristers and Solicitors 5300 Commerce Court West, 199 Bay Street Toronto ON M5L 139 PATRICK DOVIGI c/o Peter F.C. Howard Stikernan Elliott LLP Barristers and Solicitors 5300 Commerce Court West, 199 Bay Street Toronto ON M5L 139 conrad Diamanta

22 -3- CLAIM The Plaintiffs claim: (a) a declaration that the Plaintiff, Ontario Inc. ( 254 ), is entitled to legal title of the lands and buildings known municipally as I Reef Island, Township of Muskoka Lakes, Ontario, legally described as Reef Island in Lake Joseph Medora; Muskoka Lakes and bearing PIN (LT) (the Property ); (b) a mandatory order for specific performance compelling the Defendant, PJD Properties Inc. ( PJD ). to convey the Property to 254; (c) if specific performance is denied, damages in an amount to be determined to compensate for losses, costs and expenses incurred by the Plaintiffs as a consequence of the Defendants breach of the agreement whereby the Defendants were to assign their entire interest in the Agreement of Purchase and Sale for the Property dated August 18, 2016 (the Agreement of Purchase and Sale ) to 254; (d) an Order that, pursuant to section 103 of the Courts ofjustice Act, R.S.O c. C. 43, as amended, a certificate of pending litigation be issued, to be registered on title against the Property; (e) an interim and interlocutory injunction Order prohibiting the Defendants from applying for, or making any modifications to the Property that would require an application for:

23 (ii) a Permit pursuant to By-law No (Site Alteration) of the predecessor or successor legislation; No (Zoning) of the Township of Muskoka Lakes, or its (1) a Minor Variance or Zoning By-Law Amendment pursuant to By-law material time, was the directing mind of The Plaintiff, 254, is a corporation incorporated under the Ontario Business 3. The Plaintiff, Jason Claxton, is an individual resident in Ontario. Mr. Claxton, at the Corporations Ac!, R.S.O. 1990, c. B.16. The Parties (i) such further and other relief as to this Court may seem just. (h) costs of this action; and 1990, c. C43; (g) pre- and post-judgment interest pursuant to the Courts ofjustice Act, R.S.O. of said Order that remain pending; cancel any applications referred to under subsection (e) made prior to the date (f) A mandatory Order that the Defendants shall withdraw, retract or otherwise (iv) A permit pursuant to Building Code, 0. Reg. 332/12. Township of Muskoka Lakes, or its predecessor or successor legislation; or (iii) a Permit pursuant to By-law No (Tree Preservation) of the legislation; Township of Muskoka Lakes, or its predecessor or successor -4-

24 4. The Defendant, PJD, is a corporation incorporated under the Ontario Business 5. The Defendant, Patrick Dovigi, is an individual resident in Ontario. Mr. Dovigi was, at Corporations Act, R.S.O. 1990, c. B.16. PJD holds fee simple title to the Property. controlled by him, to PJD or Mr. Dovigi under the Assignment Agreement. Mr. Claxton confirming that there would be no funds payable from Mr. Claxton, or an entity 6. On August 18, 2016, PJD executed the Agreement of Purchase and Sale whereby it 7. On August 30, 2016, Mr. Dovigi approached Mr. Claxton to inquire whether he would 8. On September 26, 2016, at or around 8:00 p.m., Mr. Claxton and Mr. Dovigi met at 9. On September 27, 2016, at or around 12:03 p.m., Mr. Dovigi sent a text message to controlled by him (the Assignment Agreement ). whereby PJD would assign the Agreement of Purchase and Sale to Mr. Claxton, or an entity meeting, Mr. Claxton and Mr. Dovigi concluded an agreement, later memorialized in writing, the Ritz Bar in Toronto, Ontario, to discuss the terms of the proposed assignment. During the Property for the Purchase Price on the Closing Date. be willing to accept an assignment of the Agreement of Purchase and Sale and purchase the The Assignment Agreement is Concluded (the Purchase Price ), with a closing date of November 15, 2016 (the Closing Date ). agreed to purchase the Property from a third-party seller for a purchase price of $7,950,000 The Agreement of Purchase and Sale the material time, the sole officer, director and shareholder of PJD, and its directing mind. -5-

25 reliance upon the Assignment Agreement, including, among other things: 10. from September 26, 2016 to October , the Plaintiffs took numerous steps in Steps Taken in Reliance on Assignment Agreement controlled by him. agreement to assign the Agreement of Purchase and Sale to Mr. Claxton, or an entity exchanged correspondence and proceeded in a manner consistent with the existence of an 11. From September to October 30, 2016, Mr. Claxton and Mr. Dovigi The Parties Proceed Under the Assignment Agreement Agreement of Purchase and Sale. documentation necessary to give effect to the Assignment Agreement and the (e) engaging Nick Roche of Lee Roche & Kerr as solicitor to attend to the Agreement of Purchase and Sale; and 254. which would be the entity that would take the assignment of the (d) engaging Lorne H. Saitman of Gardiner Roberts LLP as solicitor to constitute Property through S cotiabank; (c) arranging approximately S6 million in financing for the purchase of the Property; (b) engaging Ron House of Lakeland Appraisal to conduct an appraisal of the (a) arranging visits to view the Property and the surrounding area; -6-

26 On October 6, 2016, Mr. Claxton sent a message to Mr. Dovigi inquiring whether furniture was included with the Property under the Agreement of Purchase and Sale. Shortly thereafter, Mr. Dovigi sent a message to Mr. Claxton confirming that furniture was included. 13. On October 7, 2016, Mr. Dovigi inquired whether Mr. Claxton would be building on the Property after the conclusion of the Assignment Agreement and the Agreement of Purchase and Sale. Shortly thereafter, Mr. Claxton responded that they had yet to decide whether or not they were going to build on the Property. 14. On October 10, 2016, Mr. Claxton sent a message to Mr. Dovigi inquiring whether a boat slip and two parking spots at Stills Bay Landing were included with the Property under the Agreement of Purchase and Sale. Shortly thereafter, Mr. Dovigi sent a message to Mr. Claxton confirming that these items were included. 15. On October 11, 2016, Mr. Claxton and Mr. Dovigi exchanged the following text message correspondence explicitly referring to the Assignment Agreement: Received from Patrick Dovigi on Tue Oct 11, :15 PM Message : Doesn t your bank need an assignment agreement Sent to Patrick Dovii on Tue Oct 11, :16 PM Message : Yes, we need to do that. I told them we are friends and have made a verbal agreement. I m trying to pressure them into some good financing. Sent to Patrick Dovigi on Tue Oct :21 PM Message : Can you send me your lawyer info so I can have one of my guys connect re: assignment. Received from Patrick Dovigi on Tue Oct :22 PM ivlessage : Will get it

27 i.e. -8- Sent to Patrick Dovii on Tue Oct 11,201607:22 PM Message : Thank you sir 16. On October 13, 2016, Mr. Dovigi s solicitor, Mr. Bernie Gropper, sent an to Mr. Claxton s solicitor, Mr. Nick Roche, wherein he recognized the existence of the Assignment Agreement and stated, in relevant part: As per my voice mail message, I understand that my client (PJD Properties Inc. Patrick Dovigi) had assigned his interest as the Buyer in this Agreement of Purchase and Sale, to your client, Jason Claxton. The terms of the assignment are simple as there is no additional consideration being paid from your client to mine he is assuming the agreement as is. 17. On October 13, 2016, at or around 12:08 p.m., Mr. Dovigi forwarded a copy of Mr. Gropper s to Mr. Claxton. 18. On October 17, 2016, Mr. Dovigi sent a message to Mr. Claxton informing him that the Property had been appraised at S7.8 million. 19. On October 18, 2016, Mr. Claxton sent a message to Mr. Dovigi wherein he confirmed that he had obtained financing for the Agreement of Purchase and Sale, and disclosed the financing terms. 20. On October 19, 2016, at or around 1:10 p.m., Mr. Claxton sent an to Mr. Dovigi confirming that he had given his solicitor instructions to finalize the closing documentation for the Assignment Agreement and the Agreement of Purchase and Sale. 21. On October 21, 2016, Mr. Claxton and Mr. Dovigi exchanged text message correspondence where Mr. Claxton informed Mr. Dovigi that:

28 -9- (a) the assignment documentation had been sent to Mr. Gropper for Mr. Dovigi s execution; and (b) Mr. Roche was holding S300,000 in trust which would be released to Mr. Gropper once Mr. Dovigi executed the assignment documentation in repayment of the deposit that had been paid by Mr. Dovigi to the third-party seller under the Agreement of Purchase and Sale. Defendants Breach the Assignment Agreement 22. On October 3 1, 2016, Mr. Dovigi informed Mr. Claxton that he would not be assigning the Agreement of Purchase and Sale to 254 or Mr. Claxton, in breach of the Assignment Agreement. 23. On November 10, 2016, five days prior to the original Closing Date, the Agreement of Purchase and Sale closed and title to the Property was conveyed to PJD. I)efendants Take Steps to Modify the Property 24. The Defendants have submitted an application for a Minor Variance to the Committee of Adjustment for the Township of Muskoka Lakes, indicating an intention to make substantial modifications to the Property notwithstanding the dispute between the parties regarding title to the Property.

29 - 10- An Order of Specific Performance is Necessary 25. The Assignment Agreement clearly contemplated that PJD would assign the Agreement of Purchase and Sale to 254, as the entity nominated by Mr. Claxton. prior to the Closing Date and that 254 would take title to the Property on the Closing Date. 26. The Assignment Agreement is memorialized in text message correspondence between Mr. Claxton and Mr. Dovigi between September 26, 2016 and October 30, The Defendants breached the Assignment Agreement by refusing to complete the assignment of the Agreement of Purchase and Sale prior to the Closing Date. 254 and Mr. Claxton are not in breach of any their obligations under the Assignment Agreement, 28. An order of specific performance is necessary and appropriate in these circumstances as damages would be comparatively inadequate to do justice between the parties because of the subjective and objective uniqueness of the Property. Damages if Specific Performance is Denied 29. In reliance on the Assignment Agreement, Mr. Claxton has incurred significant damages, losses and costs inclciding, among others, appraisal costs, financing costs and legal costs. Mr. Claxton has also incurred significant costs as a consequence of the Defendants breach of the Assignment Agreement. 30. Mr. Claxton has also lost the enjoyment of the Property since November 15, 2016, which he would have gained but for the breach of the Assignment Agreement by the Defendants.

30 If specific performance is denied, Mr. Claxton should be compensated for these damages, losses and costs. Further particulars will be provided prior to trial. A Certificate of Pending Litigation is Necessary to Protect the Plaintiffs Interest 32. The Defendants have indicated that they have no intention to convey the Property to the Plaintiffs in accordance with the Assignment Agreement. The Defendants thus may decide to sell the Property to another party if the interest of the Plaintiffs in the Property is not protected. 33. Accordingly, the Defendants require that a certificate of pending litigation be issued and registered on title in order to protect their interest in the Property. An Injunction is Necessary to Preserve the Status Quo 34. The Defendants have indicated that they intend to make substantial modifications to the Property notwithstanding the dispute between the parties regarding title to the Property. 35. The test for an injunction is met as: (a) (b) (c) The Plaintiffs have demonstrated that there is a serious issue to be tried regarding legal title to the Property; The Plaintiffs would stiffer irreparable harm if injunctive relief is not granted as the Defendants intend to make modifications to the Property that cannot be reversed; and The balance of convenience favours the Plaintiffs as the injunctive relief sought is narrowly tailored to include only substantial modifications to the property and will not impede the normal use of the Property by the Defendants pending the trial of this matter.

31 The Plaintiffs plead and rely on Rules 40 and 42 of the Rules of Civit Procedure, RRO Reg. 194, and Sections 101 and 103 of the Courts ojiustice Act, R.S c. C. 43. February 6, 2017 McCarthy Tétrault LLP Suite 5300, Toronto Dominion Bank Tower Toronto ON M5K 1E6 Geoff R Hall LSUC# Tel: fax: ghallmccarthy.ca Trevor Courtis LSUC# 677 isa Tel: Fax: tcourtis@mccarthy.ca Lawyers for the Plaintifls

32 ONTARIO SUPERIOR COURT OF JUSTICE Proceeding commenced at Toronto STATEMENT OF CLAIM McCarthy Tétrault LLP Suite Toronto Dominion Bank Tower Toronto ON M5K 1E6 Geoff R Hall LSUC# Tel: fax: gha11rnccarthy.ca Trevor Courtis LSUC# A Tel: Fax: tcourtis@mccarthy.ca Lawyers for the Plaintiffs ONTARIO INC. AND PJD PROPERTIES [NC. AND Court File No. JASON CLAXTON afld PATRICK DOVIGI ij 1 Plaintiffs Defendants 9 C 1 I626O566

33 ONTARIO SUPERIOR COURT OF JUSTICE Court File No. CV B E T W E E N : ONTARIO INC. AND JASON CLAXTON Plaintiffs (Moving Parties) - and - PJD PROPERTIES INC. AND PATRICK DOVIGI Defendants (Respondents) NOTICE OF MOTION The Plaintiffs will make a motion to the Court as soon as the motion can be heard, at the Court House, 393 University Avenue, Toronto, ON, M5G 1E6. PROPOSED METHOD OF HEARING: The motion is to be heard orally. THE MOTION IS FOR: 1. An Order that a Certificate of Pending Litigation be issued against the property known municipally as 1 Reef Island, Township of Muskoka Lakes, Ontario, legally described as Reef Island in Lake Joseph Medora; Muskoka Lakes and bearing PIN (LT) (the Property ); and 2. An interim and interlocutory Order prohibiting the Defendants from applying for, or making any modifications to the Property that would require an application for: (a) a Minor Variance or Zoning By-Law Amendment pursuant to By-law No (Zoning) of the Township of Muskoka Lakes, or its predecessor or successor legislation;

34 - 2 - (b) a Permit pursuant to By-law No (Site Alteration) of the Township of Muskoka Lakes, or its predecessor or successor legislation; (c) a Permit pursuant to By-law No (Tree Preservation) of the Township of Muskoka Lakes, or its predecessor or successor legislation; or (d) A permit pursuant to Building Code, O. Reg. 332/12; 3. A mandatory Order that the Defendants shall withdraw, retract or otherwise cancel any applications referred to under paragraph (2) made prior to the date of said Order that remain pending; 4. Costs of this motion; and 5. Such further and other relief as this Court considers just. Background THE GROUNDS FOR THE MOTION ARE: 1. This action was commenced by Statement of Claim issued on February 6, In this action, the Plaintiffs seek, inter alia: (a) a declaration that the Plaintiff, Ontario Inc. ( 254 ), is entitled to legal title of the Property; (b) a mandatory order for specific performance compelling the Defendant, PJD Properties Inc. ( PJD ), to convey the Property to 254; (c) if specific performance is denied, damages in an amount to be determined to compensate for losses, costs and expenses incurred by the Plaintiffs as a

35 - 3 - consequence of the Defendants breach of the agreement whereby the Defendants were to assign their entire interest in the Agreement of Purchase and Sale for the Property dated August 18, 2016 (the Agreement of Purchase and Sale ) to 254; (d) an Order that, pursuant to section 103 of the Courts of Justice Act, R.S.O c. C. 43, as amended, a certificate of pending litigation be issued, to be registered on title against the Property; (e) an interim and interlocutory injunction Order prohibiting the Defendants from applying for, or making any modifications to the Property that would require an application for: (i) (ii) (iii) (iv) a Minor Variance or Zoning By-Law Amendment pursuant to By-law No (Zoning) of the Township of Muskoka Lakes, or its predecessor or successor legislation; a Permit pursuant to By-law No (Site Alteration) of the Township of Muskoka Lakes, or its predecessor or successor legislation; a Permit pursuant to By-law No (Tree Preservation) of the Township of Muskoka Lakes, or its predecessor or successor legislation; or A permit pursuant to Building Code, O. Reg. 332/12; and (f) A mandatory Order that the Defendants shall withdraw, retract or otherwise cancel any applications referred to under subsection (e) made prior to the date of said Order that remain pending;

36 - 4 - The Agreement of Purchase and Sale 2. On August 18, 2016, PJD executed the Agreement of Purchase and Sale whereby it agreed to purchase the Property from a third-party seller for a purchase price of $7,950,000 (the Purchase Price ), with a closing date of November 15, 2016 (the Closing Date ). 3. On August 30, 2016, Mr. Dovigi approached Mr. Claxton to inquire whether he would be willing to accept an assignment of the Agreement of Purchase and Sale and purchase the Property for the Purchase Price on the Closing Date. 4. On September 26, 2016, at or around 8:00 p.m., Mr. Claxton and Mr. Dovigi met at the Ritz Bar in Toronto, Ontario, to discuss the terms of the proposed assignment. During the meeting, Mr. Claxton and Mr. Dovigi concluded an agreement, later memorialized in writing, whereby PJD would assign the Agreement of Purchase and Sale to Mr. Claxton, or an entity controlled by him (the Assignment Agreement ). 5. On September 27, 2016, at or around 12:03 p.m., Mr. Dovigi sent a text message to Mr. Claxton confirming that there would be no funds payable from Mr. Claxton, or an entity controlled by him, to PJD or Mr. Dovigi under the Assignment Agreement. Steps Taken in Reliance on Assignment Agreement 6. From September 26, 2016 to October 31, 2016, the Plaintiffs took numerous steps in reliance upon the Assignment Agreement, including, among other things: (a) arranging visits to view the Property and the surrounding area; (b) engaging Ron House of Lakeland Appraisal to conduct an appraisal of the Property;

37 - 5 - (c) arranging approximately $6 million in financing for the purchase of the Property through Scotiabank; (d) engaging Lorne H. Saltman of Gardiner Roberts LLP as solicitor to constitute 254, which would be the entity that would take the assignment of the Agreement of Purchase and Sale; and (e) engaging Nick Roche of Lee Roche & Kerr as solicitor to attend to the documentation necessary to give effect to the Assignment Agreement and the Agreement of Purchase and Sale. The Parties Proceed Under the Assignment Agreement 7. From September 26, 2016 to October 30, 2016, Mr. Claxton and Mr. Dovigi exchanged correspondence and proceeded in a manner consistent with the existence of an agreement to assign the Agreement of Purchase and Sale to Mr. Claxton, or an entity controlled by him. For example: (a) (b) (c) (d) On October 6, 2016, Mr. Claxton inquired whether furniture was included with the Property under the Agreement of Purchase and Sale; On October 7, 2016 and October 16, 2016, Mr. Dovigi inquired whether Mr. Claxton would be building on the Property after the conclusion of the Agreement of Purchase and Sale; On October 10, 2016, Mr. Claxton inquired whether a boat slip and two parking spots at Stills Bay Landing were included with the Property under the Agreement of Purchase and Sale; On October 17, 2016, Mr. Dovigi sent a message to Mr. Claxton informing him that the Property had been appraised at $7.8 million;

38 - 6 - (e) (f) On October 17, 2016, a new numbered company, 254, was incorporated for the sole purpose of taking the assignment of the Agreement of Purchase and Sale on behalf of Mr. Claxton; On October 18, 2016, Mr. Claxton sent a message to Mr. Dovigi confirming that he had obtained financing for the Agreement of Purchase and Sale; 8. On October 11, 2016, Mr. Claxton and Mr. Dovigi exchanged the following text message correspondence explicitly referring to the Assignment Agreement: Received from Patrick Dovigi on Tue Oct 11, :15 PM Message : Doesn't your bank need an assignment agreement Sent to Patrick Dovigi on Tue Oct 11, :16 PM Message : Yes, we need to do that. I told them we are friends and have made a verbal agreement. I'm trying to pressure them into some good financing. Sent to Patrick Dovigi on Tue Oct 11, :21 PM Message : Can you send me your lawyer info so I can have one of my guys connect re: assignment. Received from Patrick Dovigi on Tue Oct 11, :22 PM Message : Will get it Sent to Patrick Dovigi on Tue Oct 11, :22 PM Message : Thank you sir 9. On October 13, 2016, Mr. Dovigi s solicitor, Mr. Bernie Gropper, sent an to Mr. Claxton s solicitor, Mr. Nick Roche, wherein he recognized the existence of the Assignment Agreement and stated, in relevant part: As per my voice mail message, I understand that my client (PJD Properties Inc. Patrick Dovigi) had assigned his interest as the Buyer in this Agreement of Purchase and Sale, to your client, Jason Claxton. The terms of the assignment are simple as there is no additional consideration being paid from your client to mine i.e. he is

39 - 7 - assuming the agreement as is. 10. On October 19, 2016, at or around 1:10 p.m., Mr. Claxton sent an to Mr. Dovigi confirming that he had given his solicitor instructions to finalize the closing documentation for the Assignment Agreement and the Agreement of Purchase and Sale. 11. On October 21, 2016, Mr. Claxton and Mr. Dovigi exchanged text message correspondence where Mr. Claxton informed Mr. Dovigi that: (a) (b) the assignment documentation had been sent to Mr. Gropper for Mr. Dovigi s execution; and Mr. Roche was holding $300,000 in trust which would be released to Mr. Gropper once Mr. Dovigi executed the assignment documentation in repayment of the deposit that had been paid by Mr. Dovigi to the third-party seller under the Agreement of Purchase and Sale. Defendants Breach the Assignment Agreement 12. On October 31, 2016, Mr. Dovigi informed Mr. Claxton that he would not be assigning the Agreement of Purchase and Sale to 254 or Mr. Claxton, in breach of the Assignment Agreement. 13. On November 10, 2016, five days prior to the original Closing Date, the Agreement of Purchase and Sale closed and title to the Property was conveyed to PJD. Defendants Take Steps to Redevelop the Property 14. The Defendants have submitted an application for a Zoning By-law Amendment to the Committee of Adjustment for the Township of Muskoka Lakes. Mr. Dovigi has indicated that he intends to make significant modifications to the Property, including building two more

40 - 8 - boathouses and another cottage on the Property, notwithstanding the dispute between the parties regarding title to the Property. 15. Mr. Dovigi s application for a Zoning By-law Amendment is scheduled to be heard by the Committee of Adjustment for the Township of Muskoka Lakes on February 17, The Assignment Agreement is Enforceable Against the Defendants 16. Mr. Claxton, as the directing mind of 254, and Mr. Dovigi, as the directing mind of PJD, agreed on the three requisite elements for the Assignment Agreement to be an enforceable contract: (a) (b) (c) Parties: The parties to the Assignment Agreement were 254 and PJD; Property: 254 would accept an assignment of the Agreement of Purchase and Sale and be responsible for carrying out all of the obligations of PJD under the Agreement of Purchase and Sale, including paying the Purchase Price on the Closing Date. 254 in turn would take legal title to the Property on the Closing Date. Price: There would be no additional funds flowing from 254 to PJD, or vice versa, from the Assignment Agreement. 17. The Assignment Agreement was memorialized in writing through text message correspondence between Mr. Claxton and Mr. Dovigi, meeting the writing requirement under section 4 of the Statute of Frauds, R.S.O. 1990, c. S.19. The Plaintiffs plead and rely on the provisions of the Electronic Commerce Act, 2000, S.O. 2000, c. 17.

41 - 9 - An Injunction is Necessary to Preserve the Status Quo 18. The Defendants have indicated that they intend to make substantial modifications to the Property notwithstanding the dispute between the parties regarding title to the Property. 19. The test for an injunction is met as: (a) (b) (c) The Plaintiffs have demonstrated that there is a serious issue to be tried regarding legal title to the Property; The Plaintiffs would suffer irreparable harm if injunctive relief is not granted as the Defendants intend to make modifications to the Property that cannot be reversed including substantial landscaping and the removal of trees; and The balance of convenience favours the Plaintiffs as the injunctive relief sought is narrowly tailored to include only substantial modifications to the property and will not impede the normal use of the Property by the Defendants pending the trial of this matter. A Certificate of Pending Litigation is Necessary to Protect the Plaintiffs Interest 20. The Defendants have indicated that they have no intention to convey the Property to the Plaintiffs in accordance with the Assignment Agreement. The Defendants thus may decide to sell the Property to another party if the interest of the Plaintiffs in the Property is not protected. 21. Accordingly, the Defendants require that a certificate of pending litigation be issued and registered on title in order to protect their interest in the Property. 22. The Plaintiffs will rely on Rules 3.02, 40 and 42 of the Rules of Civil Procedure, RRO 1990, Reg. 194 and Sections 101 and 103 of the Courts of Justice Act, R.S.O c. C. 43.

42 The Plaintiffs will rely on such further and other grounds as counsel may advise. THE FOLLOWING DOCUMENTARY EVIDENCE will be used at the hearing of the motion: 24. The Affidavit of Jason Claxton, sworn February 15, 2017; and 25. Such further and other evidence as counsel may advise and this Honourable Court may permit. February 15, 2017 McCarthy Tétrault LLP Suite 5300, Toronto Dominion Bank Tower Toronto ON M5K 1E6 Geoff R. Hall LSUC# 34701O Tel: Fax: Trevor Courtis LSUC# 67715A Tel: Fax: Lawyers for the Plaintiffs/Moving Parties

43 ONTARIO INC. AND JASON CLAXTON Plaintiffs and PJD PROPERTIES INC. AND PATRICK DOVIGI Defendants Court File No. CV ONTARIO SUPERIOR COURT OF JUSTICE Proceeding commenced at Toronto NOTICE OF MOTION McCarthy Tétrault LLP Suite 5300, Toronto Dominion Bank Tower Toronto ON M5K 1E6 Geoff R. Hall LSUC# 34701O Tel: Fax: Trevor Courtis LSUC# 67715A Tel: Fax: Lawyers for the Plaintiffs #