Each year we provide a summary and insight on key cases that
apply to commercial landlords and tenants. We hope you enjoyed Part
1 in our Summer 2019 newsletter.
Formation of Contract & Fundamental
Breach
In Northridge Property Management Inc. v. Champion
Products Corp., 2017 ONCA 249, the Court considered two issues
relating to agreements to lease: (1) when an agreement to lease is
binding, as opposed to an unenforceable "agreement to
agree" and (2) when the threshold of a fundamental breach by
the landlord is achieved.
Before discussing the decision in Northridge, let us go
back to basics. The case law is well-settled – there are
certain essential terms that must be agreed upon by the parties in
order for a court to find there is a binding and enforceable lease
agreement in place. The essential elements of a lease (as set out
by Williams & Rhodes and approved in many cases) are:
"the parties, a description of the premises to be demised, the
commencement date
