COURT OF APPEAL FOR ONTARIO
MacPherson, Juriansz and Pardu JJ.A.
BETWEEN
Stephen Burns
Plaintiff (Respondent)
and
Sharan Sohi and Sohi Holdings Inc.
Defendants (Appellants)
Francis Thatcher, for the appellants
Stephen Burns, respondent acting in person
John J. Adair, amicus curiae
Heard: June 10, 2016
On appeal from the judgment of Regional Senior Justice Helen M. Pierce of the Superior Court of Justice, dated June 27, 2012.
ENDORSEMENT
1The appellants Sharan Sohi and Sohi Holdings Inc. appeal from the Order of Pierce J. of the Superior Court of Justice dated September 6, 2012.
2Following a nine-day trial, the trial judge found that the appellants had breached their contract with 1164280 Ontario Inc. (“1164”) and induced Christine Favuzzi, a tenant and franchisee of 1164, to breach her contract with 1164. The trial judge awarded damages of $144,228.69.
3At the trial, the successful plaintiff was Stephen Burns, in both his personal capacity and on behalf of his brother’s corporation 1164.
4The litigation arose out of a lease relating to a restaurant in a commercial mall in Thunder Bay. The trial judge found that the appellants were liable for two breaches of contract.
5First, the trial judge found that the appellants’ refusal to provide written consent for 1164 subletting the relevant premises to Robert and Cheryl Favuzzi was unreasonable and, therefore, contrary to the Sub-Lease. The trial judge came to this conclusion because she found that the Sub-Lease imported, from the Head-Lease, a requirement that any refusal of consent to the Sub-Lease must be reasonable. She further found that Mr. Sohi had implicitly consented to the Sub-Lease when he asked Cheryl Favuzzi to operate the restaurant, thereby making Sohi Holdings’ subsequent refusal unreasonable.
6Second, the trial judge found that the early termination of the Head-Lease was a breach of the Sub-Lease. Pursuant to Article 12 of the Sub-Lease, Sohi Holdings was required to provide notice of any amendments to the Head-Lease that materially diminished 1164’s rights. The trial judge concluded that the early termination materially diminished 1164’s rights.
7The appellants appeal the findings of liability and the damages award.
8The appellants contend that the trial judge erred by finding that they consented to 1164 subletting the premises to the Favuzzis.
9We do not accept this submission. The plaintiff Dennis Burns and Mr. Favuzzi testified that Mr. Sohi gave his consent. The trial judge was entitled to believe them. Moreover, the surrounding circumstances, including the legal steps taken and expenses incurred by 1164 in creating the Sub-Lease, support this conclusion.
10The appellants submit that the trial judge erred in finding that Mr. Sohi improperly induced Ms. Favuzzi to breach her contract with 1164 that flowed from the settlement between 1164 and Ms. Favuzzi in July 1999.
11We are not persuaded by this submission. The testimony of Mr. Sohi is in direct conflict with that of Ms. Favuzzi on this issue. Ms. Favuzzi was not cross-examined. The trial judge was entitled to believe Ms. Favuzzi and disbelieve Mr. Sohi on this issue.
12The appellants assert that the trial judge erred by finding that Mr. Sohi’s conduct was driven by malice – i.e. driven by a desire to prevent the respondent from commencing legal proceedings concerning an unrelated business venture involving a nightclub called Coyotes.
13We disagree. The facts accepted by the trial judge, especially those relating to the improper inducement of Ms. Favuzzi to breach her contract with 1164 thereby robbing 1164 of important revenue, support the trial judge’s conclusion that “Mr. Sohi’s conduct was intentional and malicious.”
14The appellants contend that the damages award, especially $100,000 for inducement to breach of contract at large, was excessive.
15We do not accept this submission. The trial judge said:
Mr. Sohi engaged in a pattern of conduct directed at manipulating 1164’s tenants in order to punish the plaintiff for litigating another dispute.
Mr. Sohi was indifferent as to whether Dennis Burns or his corporation were harmed in the process. His interference forced 1164 to waste time and legal fees in suing Ms. Favuzzi and soliciting Mr. Sohi’s consent to her sublease.
There is no commercial justification for Mr. Sohi’s conduct. It did not arise out of legitimate business objectives or promote his corporate interests… In short, Mr. Sohi’s conduct was reprehensible. It is deserving of punishment.
16The appeal is dismissed. Although self-represented, the respondent is entitled to costs fixed at $750 inclusive of disbursements and HST to offset his costs of $750 on the dismissed cross-appeal.
“J.C. MacPherson J.A.”
“R.G. Juriansz J.A.”
“G. Pardu J.A.”