Kelowna man who broke his promise forced to sell property at huge loss

A Kelowna man who had a case of “seller’s remorse” has been forced to sell his home for about half its value after he reneged on an agreement with a developer after housing prices soared.

Homeowner Gregory Steven Baytalan had been ordered to pay $181,000 to cover the amount of money Culos Development spent on rezoning and site plans in preparation for purchasing the property.

However, the developer appealed the decision, and in a unanimous verdict at the BC Court of Appeal, the panel of three Justices ordered Baytalan to sell the property at the original agreed-upon price of $1.5 million.

According to a July 28 BC Court of Appeal decision, Baytalan bought his Glenmore home in 1996 when the property was largely surrounded by fields. Over the years, as the area boomed, various developers had approached Baytalan about selling his property, but he’d always said no.

Then, in 2020, he approached Michael Culos, whom he knew from church and a service club he was involved with.

The two came to an agreement whereby Culos would pay $1.5-million for the property, which was valued at about $1.3-million, and build supportive housing on it to sell to BC Housing.

Baytalan was initially “quite happy” with the agreement.

However, they signed the contract in March 2020 and in the months that followed the housing market began to boom.

Culos had 18 months to complete the purchase, but as property prices increased by 35%, Baytalan got cold feet.

One appraisal valued the property at close to $4 million.

As the completion date neared, Baytalan stopped answering emails and refused to accept a deposit cheque for the sale.

“This is a case of seller’s remorse,” BC Supreme Court Justice Gary Weatherill said in a June 2024 decision. “When he signed the (offer to purchase), Mr. Baytalan was quite happy with the agreement he negotiated.”

Justice Weatherill ruled Baytalan should pay Culos $181,00 to cover what he’d already spent on the site, but stopped short of saying the contract needed to be honoured for $1.5-million.

The developer appealed and argued that the contract was binding and Baytalan had breached its terms.

The decision said various appraisals put the property, which is just shy of an acre, between $2.8-million and $3.3-million.

Both sides put forward numerous legal arguments as to why they should get the property for the price they wanted.

“At the time that Mr. Baytalan breached the (offer to purchase), the property was not simply land that, for the purposes of development and profit, could be exchanged for any other. Rather, it was land in respect of which a significant amount of site-specific planning had already been performed. Substantial investment in due diligence and pre-development work as well as, amongst other factors, the completion of the relevant rezoning and planning process are all factors that can be taken into account,” Justice Patrice Abrioux said in the decision.

Ultimately, the Appeal court sided with the developer and gave Baytalan 60 days to complete the sale for $1.5-million, considerably less than the property is now worth.