COURT FILE NO.: 322/06 and 323/06

DATE: 20080122 (re-released)

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

Carnwath, Kiteley and Murray JJ.

B E T W E E N:

Lauren Jung

Constantine Grimanis, solicitor for Lauren Jung

Tenant/Appellant

• and -

Toronto Community Housing Corporation

Craig Logie, solicitor for TCHC

Landlord/Respondent

HEARD: October 16, 2007

By The Court:

1These are two appeals under s. 196(1) of the Tenant Protection Act¹ of two orders of the Ontario Rental Housing Tribunal. In case number 323/06 the Tribunal allowed the application by the TCHC and ordered the eviction of Ms. Jung and ordered compensation. The application by Ms. Jung (case number 322/06) for a determination that she was the tenant and a declaration that the TCHC had substantially interfered with the reasonable enjoyment of the rental unit was dismissed. For the reasons that follow, we allow the appeal and send both applications back to the Tribunal differently constituted for a hearing and determination.

Background:

2Jang-Soon Jung became a tenant in 1984. In October 1989, Lauren Jung (who was then aged about 17), moved into the apartment with her grandmother. In April 2006, Ms. Jung’s grandmother was hospitalized and Ms. Jung expected that she would have to move to a nursing home. Ms. Jung went to the landlord’s office to request that her name be put on the lease so that she might stay in the apartment. Jang-Soon Jung did return briefly to the apartment before she died on May 3, 2006.

3In an Application About Tenant Rights (Form T2) dated May 23, 2006, Ms. Jung indicated that she had moved in with her grandmother in 1989 to provide personal attention. She had lived there constantly since. After she approached the landlord’s representative about staying in the apartment, the landlord had issued a notice of eviction to her grandmother. When her grandmother died, the landlord’s representative told Ms. Jung’s lawyer that Ms. Jung had to vacate the unit by June 3, 2006 or the locks would be changed. She brought the application alleging the landlord’s serious interference with her reasonable enjoyment of the unit. She asked for a ruling that she be declared to be a tenant and that she be allowed to remain without fear of having the locks changed.

4In an Application About a Sublet or an Assignment (Form A2) dated May 27, 2006, the landlord asked for an order “evicting the unauthorized occupant” because the landlord had not consented to the sublet or assignment. While the box seeking compensation was not checked off, the amount of $13.50 per day was inserted. The tenant was described as “Jang-Soon Jung (Deceased)”.

5Both applications were heard by Member Gerry Taylor on June 15th, 2006. Mr. Grimanis had a preliminary objection that the landlord’s application named a dead person. He queried how that was appropriate. At page 4, the Member observed, without hearing from Mr. Fine, that it was not unusual because “we have tenants that pass away in apartments and we send out because the Act clearly outlines the responsibility that if a person passes away while they’re in a unit the tenancy terminates within 30 days.” Mr. Grimanis repeated his objection and queried how a dead person could be served. The Member noted that the occupant had been served. At page 6, the Member said that he had looked through the folder and he found nothing wrong with it. That ended the preliminary objection.

6Mr. Grimanis then pointed out that his application was first in time but he suggested that both matters be tried together. At page 7, the Member said:

Both matters will be heard. One will be given a very short shift (sic), if I might say that, and that is because she’s not a tenant. She has no right to bring an application.

7Mr. Fine then raised what he described as a preliminary issue. He began his submissions that Ms. Jung was not a tenant but an unauthorized occupant and that the landlord sought to evict because the tenant could not transfer occupancy of the unit except in accordance with s. 17 and 18 of the Act. The Member’s short but affirmative responses indicated his agreement with Mr. Fine. At page 9 of the transcript, Mr. Fine took the position that the Member had no jurisdiction because there was no tenancy and there was no relationship of landlord and tenant. He said the following:

The occupant is simply a person who remains in the unit. She is not a tenant. There’s been no turning of the minds. The landlord and tenant have never had a discussion about her being a tenant except for the one when she said to the staff at TCHC, “I’d like to be a tenant”, and TCHC said, “No, Ma’am, you’re not”. Que (sic) jumping is not something in social housing that we can condone. You lived here. You are an occupant, fair enough, but they said to her in April “You’re not a tenant”.

8Mr. Fine then described an unrelated case where the tenant had been evicted but had broken in and resumed occupation. And at page 11, he concluded his point as follows:

. . . My position is that section A1 was never designed to handle a place where there’s a squatter because you don’t need it. I would simply like an order of this tribunal saying the Act does not apply because there’s no tenancy here, no more than there was when that woman snuck back in to the basement.

9Mr. Grimanis objected to the example as being inappropriate at which point Mr. Fine told the Member that if he made the order that the Act does not apply, then the landlord would change the locks and allow her to get her stuff out.

10At page 12, the Member asked if Mr. Grimanis would like to present an argument. He offered the reasons for decision of Kizemchuk v. Kizemchuk² where the Divisional Court held that the definition of “tenant” in s. 1 could include a person who does not pay rent. He asserted that Ms. Jung was “an heir of the tenant” and therefore also included in the definition. Mr. Fine interjected to distinguish Kizemchuk. Mr. Grimanis resumed his submissions with interjections by Mr. Fine. He noted that Ms. Jung had been living in the same place since she was 17 years old. When Mr. Fine interrupted to argue that she was an occupant but not a tenant, the Member agreed. Mr. Grimanis observed that Mr. Fine seemed to argue that there had been an assignment of the tenancy but Mr. Fine replied that they were dealing with his preliminary objection as to whether the Act applied. He said that the Member had an obligation to determine whether he had jurisdiction. The exchanges among Mr. Fine and Mr. Grimanis and the Member continued for several pages with the Member generally agreeing with Mr. Fine. Mr. Fine said that there was no case law that supported the proposition that tenancies should be passed in perpetuity. He said that he had “a wealth of case law here”³ about tenancies not being transferred from family to family including some very on-point case law, one just decided recently in the Divisional Court called Jemiola v. Firchuk⁴, which he observed was very telling. Mr. Grimanis asked for a copy of the case. Mr. Fine observed that if the Member wished to make a decision immediately, then it would be unnecessary to look at the case.

11At page 16 of the transcript, the Member said it would be helpful so Mr. Fine began submissions on Jemiola. He then referred to Lifshitz⁵ and to the Estate of O’Brien⁶ and to Valleyview Apartments⁷. At page 21, he concluded that “This is so settled in law”. The Member agreed.

12At page 21, Mr. Grimanis asked to review the case but Mr. Fine carried on with more submissions. He concluded at page 23 that “the Act does not apply. This woman is not a tenant. She had no right to bring a T2 and we’d ask that you make a finding the Act doesn’t apply”. The following exchange began at page 24:

Mr. Fine: I might say, Member Taylor, and I would have the witness give evidence on this motion, that from a public policy standpoint the biggest problem the TCHC and every social housing landlord has is que (sic) jumping and who lives in the units.

The Chair: Right.

Mr. Fine: An RGI unit⁸ is incredibly attractive to other people who aren’t tenants.

The Chair: Mm-hmm (affirmative), I can understand that.

Mr. Fine: You could testify to this certainly better than I can give submissions on it.

The Chair: Yes.

Mr. Fine: We would destroy the entire scheme that was created under the Social Housing Reform Act in 2000 if we simply said she’s lived there for 12 years, which we don’t know but we don’t contest. She’s lived there for 12 years and somehow she should become a tenant.

The Chair: All right. No, I don’t think it’s necessary. I think it seems to follow normal everyday logic that we couldn’t allow that and otherwise the system would be - - and I certainly am aware that the waiting lists are years long. It’s not - -

Mr. Fine: Ten years long.

The Chair: - - - like somebody can just jump in there tomorrow so, yes, I understand perhaps why this young woman before us would certainly like to grab hold of this unit, as it were, but that’s not the procedure.

Mr. Grimanis: May I make submissions, sir?

The Chair: On what, sir?

Mr. Grimanis: With this case, having my turn.

The Chair: Go ahead?

Mr. Grimanis: Because all of them are irrelevant in my view.

13Mr. Grimanis referred to some of the cases and tried to distinguish them. He observed that Ms. Jung was already a tenant and that she qualified for public housing. Mr. Fine interjected that Mr. Grimanis was giving evidence at which point Mr. Grimanis said that he had evidence if the Member wanted to hear it and that nobody from the Landlord’s office had spoken to her about whether she qualified or not. Mr. Fine interjected to disagree that it was the Landlord’s duty to be proactive. At page 28, Mr. Fine insisted that they were involved in a motion as to whether the Act applied. Mr. Grimanis pointed out that he had been given no notice that that would be an issue. He queried how he could have prepared for such an issue. At page 29, he said the following:

. . . And I don’t think that this is a proper - - I think this is trial by ambush by my friend because, you know, I mean he knew that this was going to be argued by him. He could have served a notice a month ago, two months ago and then you know. We would take the proper - - we would do the proper reply to it.

But, now, I mean I’m sitting here all of a sudden faced with an issue and it’s not really a preliminary because, as I say, we don’t have his application. . . .

14Mr. Fine responded that the Member had an obligation to make sure that the Tribunal has jurisdiction. He made further submissions. At page 31, Mr. Grimanis asked for an adjournment because the issue of jurisdiction had been sprung on him. He wanted an opportunity to research and prepare. The hearing ended as follows:

The Chair: Mm-hmm (affirmative), okay. But, your request, sir, that if I decide the Act doesn’t apply you’d like it rescheduled so you can respond to that, there’s nothing to respond to. If I make a decision the Act doesn’t apply, that’s it. I don’t hear anything any more because the Act doesn’t apply.

Mr. Grimanis: Instead of making a decision, sir, I’m saying that the wiser course would be to give me an opportunity to make proper submissions by giving me a postponement of the hearing. If you decide to do it like this then, you know, you haven’t given me the opportunity and I am at the very least denied natural justice if nothing else.

Mr. Fine: Sir, he knew what the issues were.

The Chair: There’s no denial of natural justice, sir. How can you claim - - -

Mr. Grimanis: This is the thing you decide, sir.

The Chair: Oh, here it is.

Mr. Grimanis: Here it is. He’s scared I’m going to argue something that - - -

The Chair: Okay, I’ve heard enough. Any other final statements on this matter? I’ve got to move on here. I’ve spent quite a bit of time on one that should have been relatively straight forward, I think.

Mr. Fine: I’m done.

The Chair: You’re done. Nothing more, sir? Okay. I’m going to reserve my decision here. I’ll send out a response on this tomorrow.

Mr. Fine: Thank you very much.

The Chair: Okay.

Mr. Fine: Thanks very much.

The Chair: Mr. Fine? Did he leave already? Did Mr. Fine leave?

Mr. Fine: Sorry.

The Chair: Just to clarify before the two parties leave, the tenant application on this matter that was brought by this lady, she’s not a tenant and has no right to bring an application, so that one is clear. That one is dismissed. Now, what I do with the other one, I will decide and issue an order as I said, okay? . . .

Decisions of the Tribunal:

15On June 16, 2006, the Member issued an order dismissing the application brought by Ms. Jung. He concluded that she was an occupant and did not have status to bring the application.

16On June 19, 2006, the Member issued an order granting the application brought by the landlord. He mentioned the cases to which Mr. Fine had referred and the Kizemchuk case to which Mr. Grimanis had referred. He indicated that the landlord’s representative had entered a motion to determine whether the Tribunal had jurisdiction. He referred to Mr. Fine’s argument including his submission that Ms. Jung should be considered to be a squatter. The decision includes the following:

Having considered all of the above, I find there is no way the tenancy in this instance could have been transferred to Ms. L. Jung. As a matter of fact during the Landlord’s evidence, a statement was made to the effect, “In April, the Occupant was told she could not become a Tenant by queue jumping”.

I also find it possible that the Tenant, sometime before her death, may have given Ms. L. Jung the perception that the rental unit would be hers. Based on this possibility, I find it reasonable to allow the hearing as per the application based on section 81 of the Act.

It is determined that:

1. The Tenant transferred the occupancy of the rental unit to Lauren Jung in a manner that was not authorized by the Act. The Landlord did not enter into a tenancy agreement with this person.

2. The Landlord is a provider of rent geared to income housing which has a waiting queue of up to 10 years. It would not be reasonable to refuse this application pursuant to section 84 of the Act. It would be most prejudicial to the thousands of families currently in line and following the established procedures.

3. The Occupant, Ms. L. Jung was told by the Landlord in April that she could not become a Tenant without going through the normal process.

4. Section 49 states the tenancy ends 30 days after the Tenant is deceased. This Tenant passed away in early May 2006. The Occupant now needs to move out of the rental unit.

17The member then ordered Ms. Jung to move out by June 30, 2006 and he ordered her to pay compensation in the amount of $553.50 from May 10, 2006 to June 19, 2006 and $13.50 per day thereafter along with $150.00 in costs.

Jurisdiction:

18According to s. 196(1) of the Act, an appeal may be brought “only on a question of law”. If the appeal is granted, the Divisional Court has broad powers to hear and determine the appeal, affirm, rescind, amend or replace the decision or remit the matter to the Tribunal with the opinion of the Court. The standard of review is therefore correctness.

19Ms. Jung has appealed from both orders. There are many enumerated grounds of appeal but fundamentally the issue is procedural fairness. This court has held⁹ that where a tribunal’s decision is attacked on the basis of a denial of natural justice, it is not necessary for the Court to engage in an assessment of the standard of review.

Analysis:

20The Divisional Court has made it clear that every Tribunal is entitled to control its own procedure and will be accorded deference on matters requiring an exercise of discretion.¹⁰ However, the extent to which a duty of fairness arises in establishing that procedure has been directed in Baker¹¹ where the Supreme Court of Canada identified five non-exhaustive factors that should be considered in determining the content of the duty of fairness: the nature of the decision, the nature of the legislative scheme, the importance of the decision to the individual affected, the legitimate expectations of the person challenging the statute, and the decision-maker’s choice of procedure.

21The fundamental decisions to be made were whether Ms. Jung had any rights in the unit and whether the landlord could evict her. The scheme of the legislation is designed to have such issues dealt with in a straightforward and expeditious manner. The decision is particularly important to Ms. Jung because she would be deprived of accommodation. It is important to the landlord but of no immediate consequence to the Corporation. Ms. Jung had lived with her grandmother for 12 years. She had a legitimate expectation that she would have a hearing before she was evicted.

22With respect to the Tribunal’s choice of procedure, the Act contains different requirements depending on the issue under consideration. For example, if the Tribunal makes an order under s. 72 and the tenant moves to set it aside, under s.72(10), the Tribunal “shall hold a hearing”. If the Tribunal sets aside an order made under s. 76, then under s. 76(8), the Tribunal “shall hear the merits of the application”. Under s. 81 (to which Member Taylor referred), the “landlord may apply to the tribunal for an order” but there are no procedural requirements. In the printed information attached to the Form A2 and the T2 the recipient is told that once the application is filed, “the Tribunal will give the tenant a Notice of Hearing”. The printed information also refers the recipient to the Rules and Guidelines from the local Tribunal office that include references to oral hearings, written hearings and electronic hearings.

23Based on the foregoing, Ms. Jung was entitled to have an oral hearing in which evidence would be led and legal submissions would be heard and considered as to her status. Procedural fairness dictates that Ms. Jung be given notice of the facts, arguments and considerations upon which the decision is to be based and an opportunity to make submissions.¹²

24We agree that every tribunal must establish that it has jurisdiction. However, the determination of that issue is also subject to the duty of fairness. Simply because it is a preliminary issue does not mean it is to be dealt with peremptorily.

25The extensive excerpts from the transcript indicate that virtually all of the rules of natural justice have been violated. The Member demonstrated bias from the outset by indicating as early as at page 7 that the issue of Ms. Jung’s status would be given “short shrift”. That was demonstrated on other occasions where he clearly appeared to be agreeing with Mr. Fine but most particularly when Mr. Grimanis asked to make submissions and at page 25, the Member asked “on what” (subject), suggesting that there was nothing further to add. He refused to consider Mr. Grimanis’ request for an adjournment although it was apparent that no notice had been given that the jurisdictional matter would be raised. He should have heard evidence as to the discussions between Ms. Jung and the landlord’s representative. In her application, it was asserted that she had gone to the landlord’s office to request that her name be put on the lease. Her application did not contain any indication as to the response. Yet Mr. Fine said and the Member relied on it, that “in April, the Occupant was told she could not become a Tenant by queue jumping”. There was no evidence on that point. The Member adopted what was asserted by counsel for the Landlord. Furthermore, in his written reasons, he relied on cases provided by Mr. Fine without giving Mr. Grimanis an opportunity to read them and without appreciating that four of them were written prior to the Tenant Protection Act and may be of limited relevance.

26Mr. Grimanis offered to provide evidence but none was permitted. The Member suddenly stopped the hearing and announced his decision on Ms. Jung’s application. The result on the landlord’s application was a foregone conclusion. There is no reference in the transcript to the issue of compensation yet the Member ordered compensation. He heard neither evidence nor submissions. There is also no reference in the transcript to the issue of costs yet he ordered Ms. Jung to pay costs. When Mr. Grimanis asserted that natural justice was being denied, the Member’s response seemed to indicate a lack of understanding of those fundamental principles. Ms. Jung had been in occupation for 12 years. Mr. Fine said at page 24 that he did not contest that she had been there for 12 years. While not specifically raised in the Application, that fact alone required an analysis as to whether Ms. Jung had an implied tenancy. That analysis could only be undertaken with a proper evidentiary record and legal submissions.

27The Tribunal appeared biased. The person most at risk was denied a hearing. It was, as Mr. Grimanis said, a “trial by ambush”. The decisions must be set aside.

Costs:

28At the conclusion of the hearing, Mr. Logie indicated that he would not be seeking costs. Mr. Grimanis said that if successful, he would seek costs. Within 10 days of release of these reasons, Mr. Grimanis shall make written submissions including a Costs Outline. Mr. Logie shall respond within 10 days thereafter.

ORDER TO GO:

29The decisions of the Ontario Rental Housing Tribunal dated June 16, 2006 and June 19, 2006 are set aside.

30The application by the Landlord and by the Tenant will be remitted to be heard by the Tribunal differently constituted.

Carnwath J.

Kiteley J.

Murray J.

Re-released to correct names in paragraph 28

(20080122)

Footnotes

1. 1S.O. 1997, c.24. The Act has been repealed. S. 242(1) of the Residential Tenancies Act 2006 S.O. 2006 Ch. 17 provides that the repealed Act applies to this appeal.
2. 2Ont. Div. Ct. [2000] O.J. No. 2763
3. 3Transcript does not contain accurate case names or citations. Names are taken from the Tribunal’s decision.
4. 4[2005] O.J. No. 6085
5. 5Lifshitz et al v. Forest Square Apartments Ltd. Ont. Div.Ct. [1982] O.J. No. 3204
6. 6O’Brien Estate v. Frastell Property Management Ont. District Court [1989] O.J. No. 964
7. 7Valleyview Apartments Ltd. v. Rothbart Estate Ont. Div Ct. 1988 4781 (ON SC), [1988] O.J. No. 1112
8. 8RGI unit – rent geared to income unit
9. 9[Gismondi v. Ontario (Human Rights Commission), 2003 21371 (ON SCDC), [2003] O.J. No. 419
10. 10[Kalin v. Ontario College of Teachers (2005) 2005 18286 (ON SCDC), 75 O.R. (3d) 523
11. 11[Baker v. Canada (Minister of Citizenship and Immigration), 1999 699 (SCC), [1999] 2 S.C.R. 817
12. 12[Losenno v. Ontario Human Rights Commission 2005 36441 (ON CA), 2005 36441 (O. C.A.)