Stouffville sued for $38.1 million after land deal for Bethesda Sports Park falls through

Yorkregion.com
April 21, 2022

The Town of Whitchurch-Stouffville is being sued for $38.1 million for a land deal involving the Bethesda Sports Park. Mayor Iain Lovatt and CAO Rob Adams are also named in the lawsuit.

According to a statement of claim filed in March by 2348219 Ontario Inc., the town breached its contractual duty to exercise its discretion in good faith by failing to waive the outstanding conditions of the sale that allowed it to terminate the transaction.

The town released a statement saying it received an offer in April of 2021 to purchase the Bethesda Sports Park. “The town never listed the property for sale,” the statement said.

After consideration, the town said it did not feel it was in a position to complete the sale for the current sports park since a new location had not been finalized or secured.

“The resulting decision by council to allow the agreement to become null and void by not waiving its condition during the town’s due diligence period has resulted in the conditional purchaser commencing legal action against the town. The town will be vehemently defending our right to make this decision.”

Having consulted with legal counsel, the town said it does not believe that the claim has merit.

The statement of claim alleges that on April 5, 2021, 2348219 Ontario, owned and operated by Mark Edwards, entered into an agreement of purchase and sale with the town to buy 52 acres of land at 6301 Bethesda Rd. for future development. The parties had been in talks for months prior to the agreement and the suit alleges the defendants brought forward the idea of the Bethesda Sports Park.

The purchase price agreed to, according to the claim, was $77.9 million -- $1.9 million an acre for 41 acres of developable land -- with a conditional period running from April 5 to Jan. 26, 2022. Edwards was surprised that his development corporation did not have to compete with other potential bidders.

According to the town’s statement, the offer presented the town with an opportunity to investigate the merits of the park's current location and potentially relocate it to another, larger location. “A new, more extensive park could also provide easier access and create a more enjoyable user experience while accommodating future growth requirements anticipate,” the statement said. “A larger park would provide more recreational opportunities for users, such as additional soccer fields, softball diamonds, baseball diamonds, and a cricket pitch. In turn, the park would accommodate larger local and provincial tournaments.”

The town is currently updating its leisure and community services master plan in response to its growing population and increasing recreational demands of the community. As part of the process, future needs, including new sports field requirements and locations, are being reviewed.

The Bethesda Sports Park isn't the only recreation asset that town has tried to sell recently. In December, the town announced the sale of SoccerCity for $8.8 million. SoccerCity was a town-operated facility but the town leased the facility from Cabrera Ridge Building Corp. As part of the lease agreement, Ward 4 Coun. Rick Upton said the town had the option to buy the facility for $7.7 million. When a local investor came forward with interest in buying the facility the town exercised its option to buy the facility for $7.7 million and then sell to a the business owner at a $1.1-million profit. Upton said the town will also save close to $1 million in lease payments.

The new owner is looking at putting a second floor in the building and turning it into offices.  At the time Upton said the town was not looking to sell any other facilities.

The town is planning for the Bethesda Road to be a key growth area with development of a major transit station area (MTSA) around the Old Elm GO Station.