Court File and Parties
COURT OF APPEAL FOR ONTARIO
Lang, Juriansz and Epstein JJ.A.
BETWEEN
Patrick Dewan, Domicile Developments Inc., 1436984 Ontario Ltd., Amira Gabriel, 1496055 Ontario Inc., 117490 Canada Ltd., and Sheila Eberts
Plaintiffs/Applicants (Respondents)
and
Claude-Alain Burdet, in Trust
Defendant/Respondent (Appellant)
Jonathan H. Fine and Kristen Bailey, for the appellant
Kenneth Radnoff, Q.C., for the respondents
Heard and released orally: November 28, 2008
On appeal from the order of Justice Paul F. Lalonde of the Superior Court of Justice dated August 10, 2007.
ENDORSEMENT
1This is an appeal from the order dated August 10, 2007 in which the motion judge ordered the appellant to repay $159,873 and to expunge $296,887 of receivables.
2In our view, because the motion judge lacked jurisdiction on a motion to grant the relief sought in the action, the appeal must be allowed. To explain this conclusion it is necessary to review the lengthy and complicated history of the litigation.
3The litigation arose over a dispute between the appellant and other unit owners regarding control of a commercial condominium corporation, Carleton Condominium Corporation 396 (CCC 396). The ensuing litigation has involved numerous motions and appeals. We refer only to those proceedings that are relevant to the disposition of this appeal. 1
4The respondents commenced this proceeding in 2001 when they brought an application pursuant to the oppression remedy provision of the Condominium Act, 1998, S.O. 1998, c. 19, s. 135(3). On the return of the application, Granger J. made an order on consent (the 2001 order). That order provided that the application would proceed by way of an action. The order also adjourned a pending motion until after the close of pleadings and prohibited the appellant in the meantime from taking any steps to enforce alleged defaults by the respondents.
5Seven years later, the action has proceeded no further because the respondents have never delivered a statement of claim.
6However, on April 2, 2002, the respondents brought a contempt motion on the basis that the appellant had failed to comply with the prohibitions contained in the 2001 order. On the return of the motion, in addition to ordering that the 2001 order would remain in force, the motion judge ordered the appellant to produce books and records relating to his management of CCC 396, appointed an independent manager to assume management of CCC 396, and appointed accountants as auditors to prepare a forensic audit.
7On April 29, 2005, the respondents purported to return the original application before the same motion judge. On the return of that "application", the motion judge ordered the appellant to produce documents to the auditor and to pay various costs (the 2005 order). He also gave the respondents permission to register a lien against the appellant's interest in his CCC 396 units.
8On August 10, 2007, the respondents returned the matter to the court by way of a Notice of Return of Application, again before the same motion judge. The Notice described the proceeding as an "application originally returnable on November 29, 2001, brought back on April 2, 2002, and again on April 29, 2005, and adjourned on that date". The respondents argued that when the appellant had control of CCC 396, in addition to other misconduct, he improperly billed CCC 396, both personally and through E.T.R.E. Inc., a company that the motion judge held was merely an alter ego for the appellant.
9The respondents also claimed that the appellant refused to provide the required documents to the court-appointed auditor in violation of the 2002 order and the 2005 order. In addition to the relief sought in the earlier proceedings, the respondents sought, among other things, an order requiring the appellant to pay and to repay the sums of $12,485.00 and $159,863.00 to CCC 396 and to expunge $296,887.00 worth of receivables E.T.R.E. Inc. claimed it was owed by CCC 396.
10The appellant's chartered accountant, Ken Lagasse, filed a report giving his opinion that, at most, the respondents were billed an extra $4.00 per month per unit. The appellant argued that such an amount could not form the basis for an oppression remedy. The appellant also claimed that he provided all financial records that were properly requested.
11The motion judge rejected the Lagasse report and accepted the report of the court-appointed auditor. He also rejected the appellant's evidence regarding production of documents. The motion judge granted the respondents' requested monetary relief. In our view, this result was not open to the motion judge.
12Since the application was converted to an action, there was no "application" for the respondents to return before the motion judge. The issue of the respondents' claim for a declaration of oppressive conduct must be determined at trial after an exchange of pleadings. The only matters that could be returned before the motion judge were those involving the outstanding interlocutory dispositions and contempt. We do not accept the respondents' argument that the award involving more than $450,000 was in effect an award relating to the appellant's contempt. We see no finding of contempt in the motion judge's reasons or order relating in any way to the relief granted. Moreover, the motion judge had no jurisdiction to grant substantive relief as a remedy for contempt.
13Consequently we would allow the appeal, set aside paras. 1, 2, 3 and 6 of the motion judge's order and remit the motion for determination of the interlocutory relief and the contempt motion. These issues will be returned to the Superior Court before a different judge. In our view, it is appropriate that para. 4 of the order remain in force as it maintains the status quo pending the trial of the action.
14The appellant is entitled to his costs of the appeal and for the appearance before the motion judge, which we fix at $15,000, inclusive of disbursements and Goods and Services Tax.
"S.E. Lang J.A."
"R.G. Juriansz J.A."
"G. Epstein J.A."
