Sutton v. Riddle, 2021 ONSC 1403

minicounsel

Ontario Reports

Ontario Superior Court of Justice

Divisional Court, Sachs, Abrams and O'Bonsawin

JJ.

February 26, 2021

154 O.R. (3d) 622 | 2021 ONSC 1403

Case Summary

Administrative law — Procedural fairness — Appellant applying to terminate respondents' tenancies of cottages to allow his children to occupy premises — Respondents acknowledging lease of land but claiming that they owned cottages — Landlord and Tenant Board deciding it had jurisdiction to decide ownership issue and deciding that respondents owned cottages — Appeal dismissed — Board had statutory authority to decide ownership issue and did not err in law — Board had authority to choose its own procedure and appellant was not denied procedural fairness — Residential Tenancies Act, 2006, S.O. 2006, c. 17, ss. 168, 174 — Statutory Powers Procedure Act, R.S.O. 1990, c. S.22, s. 15.

Landlord and tenant — Residential tenancies — Eviction — Land lease home — Appellant applying to terminate respondents' tenancies of cottages to allow his children to occupy premises — Respondents acknowledging lease of land but claiming that they owned cottages — Landlord and Tenant Board deciding it had jurisdiction to decide ownership issue and deciding that respondents owned cottages — Appeal dismissed — Board had statutory authority to decide ownership issue and did not err in law — Board had authority to choose its own procedure and appellant was not denied procedural fairness — Residential Tenancies Act, 2006, S.O. 2006, c. 17, ss. 168, 174 — Statutory Powers Procedure Act, R.S.O. 1990, c. S.22, s. 15. [page623]

The appellant owned two parcels of land. A cottage on each parcel had been occupied by the respondents for more than 30 years. The appellant applied for termination of the respondents' tenancies on the basis that he required the premises for the purpose of residential occupation by his children. The respondents acknowledged that they leased the land from the appellant but claimed that they owned the cottages. The matter went to the Landlord and Tenant Board, which after an oral hearing issued an interim order stating that the appellant's grounds for termination were legitimate, but that the matter could not be determined without deciding who owned the cottages. The Board decided that it had jurisdiction to deal with the ownership issue, and ordered the parties to file their evidence and submissions in writing. The parties complied and at the end of the hearing, the Board decided that the respondents owned their cottages and as such dismissed the eviction application. The appellant appealed in respect of both cottages.

Held, the appeals should be dismissed.

The Board had jurisdiction to decide the ownership issue. The applications were heard together in person by the Board over two days. On the first day, the parties raised the issue of the Board's jurisdiction. The Board member did not give any explicit indication of her conclusion on the subject. Further, over the balance of the two days, the Board heard considerable evidence in respect of who owned the cottages, as well as the appellant's good faith assertion that he required the property for his own use. After considering all the evidence, the Board, in preferring the respondents' view on the subject of ownership, found it more likely than not that the cottages were each a land lease home, which the Board was entitled to do. The Board had authority under the Residential Tenancies Act to hear and determine all questions of fact and law with respect to the application. Determining whether someone was an "owner" of their dwelling for the purpose of the Act involved an assessment of the factual and contractual underpinnings of the relationship between the parties and the application of those underpinnings to the provisions of the statute. That was a question of mixed fact and law and thus not reviewable.

The appellant was not denied procedural fairness. If the appellant felt that his procedural rights were compromised by the interim order made by the Board assuming jurisdiction of the ownership issue and directing the manner by which it would be determined, he was obligated to make those objections to the Board and not wait until the appeal to raise his fairness concerns.

The Board did not err in law in deciding the ownership issue. The appellant contended that the Board failed to apply the common law concerning the ownership of fixtures attached to land, and admitted unreliable hearsay evidence. However, the Legislature included the concept of permanency in the definition of a land lease home, and thereby expressly addressed characteristics that would otherwise be relevant in determining whether a structure was land or chattel. The history of reform and the comprehensive nature of the Residential Tenancies Act itself showed that the Legislature codified the law in the residential tenancies context so that the common law in respect of fixtures did not apply. As for the hearsay, the Statutory Powers Procedure Act entitled the Board to choose its own procedure and to admit and rely upon the impugned evidence. If the appellant had fairness concerns regarding the nature and quality of the evidence admitted by the Board, he should have made his objections to the Board.

Warraich v. Choudhry, [2018] O.J. No. 1071, 2018 ONSC 1275 (Div. Ct.); Warraich v. Choudhry, [2018] O.J. No. 1068, 2018 ONSC 1267 (Div. Ct.), consd [page624]

Other cases referred to

Bank of Montreal v. Innovation Credit Union, [2010] 3 S.C.R. 3, [2010] S.C.J. No. 47, 2010 SCC 47, 407 N.R. 294, 2010EXP-3660, J.E. 2010-1995, EYB 2010-181515, 325 D.L.R. (4th) 605, 362 Sask.R. 1, 72 C.B.R. (5th) 23, 17 P.P.S.A.C. (3d) 1; Bart v. McMaster University (2016), 133 O.R. (3d) 592, [2016] O.J. No. 4923, 2016 ONSC 5747, 14 Admin. L.R. (6th) 306, 37 C.C.E.L. (4th) 59, 406 D.L.R. (4th) 694 (Div. Ct.); Haggert v. Brampton (Town) (1897), 1897 14 (SCC), 28 S.C.R. 174, [1897] S.C.J. No. 73; North York General Hospital Foundation v. Armstrong (2004), 2004 13872 (ON SCDC), 69 O.R. (3d) 603, [2004] O.J. No. 22, 181 O.A.C. 153, 15 R.P.R. (4th) 295 (Div. Ct.); Stack v. T. Eaton Co. (1902), 4 O.L.R. 335, [1902] O.J. No. 155, 1 O.W.R. 511 (Div. Ct.)

Statutes referred to

Residential Tenancies Act, 2006, S.O. 2006, c. 17 [as am.], ss. 1, 3(1) [as am.], (3), 48 [as am.], (1)(c), 168(2), 174, 183, 201(1)(d)

Statutory Powers Procedure Act, R.S.O. 1990, c. S.22 [as am.], s. 15, (1)

Authorities referred to

Sullivan, Ruth, Sullivan on the Construction of Statutes, 6th ed. (Markham: LexisNexis, 2014)

APPEALS from decisions of the Landlord and Tenant Board.

Lisa Scheulderman, for appellant.

Sarah Forsyth and John R. Done, for respondents in both appeals.

Katia Snukal and Brian Blumenthal, for Landlord and Tenant Board.

The judgment of the court was delivered by

ABRAMS J.: —

Overview

1These two appeals from the Landlord and Tenant Board (the "Board") were heard together. In both, the appellant sought to terminate the tenancies of the respondents on the basis that he required the occupied premises for the purpose of residential occupation by his children. The premises at issue were cottages located on land that the respondents leased from the appellant. While the respondents acknowledged the land leases, they claimed that they were the owners of the cottages in question and, thus, the appellant had no right to evict them.

2At the beginning of the hearing before the Board, the appellant took the position that the Board had no jurisdiction to determine the ownership of the cottages -- that could only be determined in the Superior Court. However, the Board did have jurisdiction to decide whether the appellant's asserted grounds for termination were being raised in good faith. [page625]

3The Board held an oral hearing in which the stated focus was the appellant's grounds for termination. At the end of that hearing, it issued an interim order in which it decided that the appellant's grounds for termination were legitimate, but that the matter could not be determined without deciding who owned the cottages. The Board decided that it had jurisdiction to deal with the matter, and ordered the parties to file their evidence and their submissions on the ownership issue in writing.

4The parties complied with the Board's directions. At the end of the hearings, the Board decided that the respondents owned the cottages and dismissed the appellant's eviction application.

5On this appeal, the appellant argues that the Board had no jurisdiction to decide the ownership of the cottages and that the Board breached procedural fairness when it held an oral hearing, appearing to concede that it did not have jurisdiction to deal with the ownership issue, then reversing itself in its interim order. The appellant also submits that if the Board did have jurisdiction to decide the ownership issue, it made two errors of law in making that decision: it failed to apply the common law concerning the ownership of fixtures attached to land and it admitted unreliable hearsay evidence. The appellant also claims that the admission of the hearsay evidence in question was a breach of procedural fairness.

6For the reasons that follow, the appeals are dismissed. In summary, the Board did have jurisdiction to decide the ownership issue. The Board did not breach procedural fairness by deciding to assume jurisdiction over the ownership issue after first leading the parties to believe it would not. It gave all the parties an opportunity to file evidence and make submissions on the issue. It was entitled to hold a hearing in writing and if any party felt that their procedural rights were compromised by that direction, they were obligated to make their objections to the Board, not wait until the appeal to raise their fairness concerns.

7The Residential Tenancies Act, 2006, S.O. 2006, c. 17 ("RTA"), has replaced the common law when it comes to the ownership of buildings located on leased land. The Board's decisions with respect to the ownership issues involved questions of mixed fact and law, and are not reviewable by this court. The Board was entitled to admit and rely on the impugned evidence.

Factual Background

8The appellant's application for termination of the tenancies at issue in this appeal was based on a Notice to Terminate at End of the Term for the appellant's own use (Form N12) served pursuant to s. 48 of the RTA. Section 48(1) (c) of the RTA provides that [page626] a landlord may terminate a tenancy if a landlord in good faith requires possession of the rental unit for the purpose of residential occupation.

9The property in this dispute is municipally known as 3 Nina's Lane, Kingston, Ontario (the "property").

10The property is comprised of two parcels of land. The first parcel is identified as PIN 36327-0517 ("Parcel 1"). The second parcel is identified as PIN 36327-0128 ("Parcel 2").

11The appellant is the registered owner of both Parcel 1 and Parcel 2.

12Parcel 1 was transferred to the appellant from Wallace Grant Leitch ("Leitch") on September 15, 2015. Parcel 1 was previously transferred from Her Majesty the Queen in Right of Canada to Leitch on September 30, 2013.

13Parcel 2 was transferred to the appellant on September 15, 2015, from Susan Elliot as personal representative for Nina Mohan. Parcel 2 was previously transferred from Nina Mohan and the Estate of Lajja Mohan to Nina Mohan on February 17, 2006. Thereafter, Parcel 2 was transferred from Nina Mohan to Susan Elliot as Nina Mohan's personal representative on March 30, 2012.

14There are four structures on Parcels 1 and 2, including a cottage occupied by the respondent, Heather Riddle Patterson ("Ms. Riddle Patterson"), and a cottage occupied by the respondents, Connie Riddle Morrow and Patrick Morrow (the "Morrows").

15Ms. Riddle Patterson has made her home in the cottage for 36 years. The Morrows have occupied their cottage for 33 years.

16Both appeals arise from the appellant's application to evict the tenants from the cottages on the basis that he requires the cottages for his children to live in.

17The appellant asserts that he owns the cottages and the land.

18The respondents contend that they own their cottages, and lease only the land in an arrangement recognized by the RTA as a "land lease" tenancy.

Issues Raised

19The following issues must be determined on this appeal:

(1) Did the Board have jurisdiction to decide the ownership issue?

(2) Was the appellant denied procedural fairness by the Board assuming jurisdiction over the ownership issue?

(3) Did the Board err in law in deciding the ownership issue by failing to apply the common law concerning the ownership of [page627] fixtures attached to land and/or by admitting unreliable hearsay evidence?

(4) Did the Board's admission of hearsay evidence result in a breach of procedural fairness?

Standard of review

20Appeals to this court from the Board lie on a question of law only. Thus, the parties agree, first, that the standard of review in this appeal is correctness, and second, when it comes to procedural fairness, there is no standard of review.

Did the Board have jurisdiction to decide the ownership issue?

21The appellant contends that the Board had no jurisdiction to decide the ownership of the cottages and that the Board breached procedural fairness when it held an oral hearing, appearing to concede that it did not have jurisdiction to deal with the ownership issue, then reversing itself in its interim order.

22There is no merit to this submission. The applications were heard together, in person by the Board over two days. On the first day, the parties raised the issue of whether the Board had jurisdiction to determine the ownership issue. The Board member did not give any explicit indication of her conclusion on the subject. Further, over the balance of the two days, the Board heard considerable evidence in respect of who owned the cottages, as well as the appellant's "good faith" assertion that he required the property for his "own use".

23Thereafter, the Board issued an interim order in which it rejected the argument that it lacked jurisdiction to determine ownership. The Board found it necessary to determine whether the rental units consisted of just the land, or the land and the cottages, in order to dispense with the applications. More specifically, because the appellant asserted that he required the cottages for his children's use, the Board found it could only evict if the "rental units" at issue were the cottages. Alternatively, if, as the respondents asserted, they owned the cottages, then the Board could not order eviction because the "rental unit" was the land or site on which the cottages were situated.

24As a result, the Board gave the parties the opportunity to make additional written submissions and present evidence on the issue of ownership. In their submissions, none of the parties asserted that the Board lacked jurisdiction to determine ownership because it had already made a decision that it did not have jurisdiction to decide this issue, nor did anyone object to the [page628] Board's direction that the second part of the hearing on the issue of ownership be conducted in writing as opposed to orally.

25After considering all of the evidence, the Board, in preferring the respondents' view on the subject of ownership, found it more likely than not that the cottages were each a "land lease home", which the Board was entitled to do.

26The RTA gives the Board exclusive jurisdiction to determine all applications under the Act and gives it the authority to hear and determine all questions of fact and law with respect to all matters within its jurisdiction, specifically:

168(2) The Board has exclusive jurisdiction to determine all applications under this Act and with respect to all matters in which jurisdiction is conferred on it by this Act.

The Board has authority to hear and determine all questions of law and fact with respect to all matters within its jurisdiction under this Act.

27The appellant filed an application under s. 48(1) of the RTA. It is uncontested that the Board had exclusive jurisdiction to determine it. By virtue of ss. 168(2) and 174, in so determining, the Board had authority to hear and determine all questions of fact and law with respect to the application.

28This court has held that whether someone is an "owner" of their dwelling for purposes of the RTA involves an assessment of the factual and contractual underpinnings of the relationship between the parties and the application of those underpinnings to the provisions of the statute. The court characterized this as a question of mixed fact and law which is not reviewable by this court: see North York General Hospital Foundation v. Armstrong (2004), 2004 13872 (ON SCDC), 69 O.R. (3d) 603, [2004] O.J. No. 22 (Div. Ct.), at para. 23.

29The appellant argues in the alternative that it was unnecessary for the disposition of the application for the Board to resolve the ownership issue. Rather, the Board could have disposed of the application without exceeding its jurisdiction in accordance with this court's decision in Warraich v. Choudhry, [2018] O.J. No. 1071, 2018 ONSC 1275 (Div. Ct.) ("Warraich 1").

30I do not see it that way. There are two decisions of this court in Warraich. These were companion cases involving a landlord's application for eviction for rental arrears and demolition. At the Board, the tenant challenged the eviction on the grounds that he was not a tenant, but a co-owner. After hearing the evidence on the subject of ownership, the Board found that he was not a co-owner, but a tenant within the meaning of the RTA, and thus granted the landlord's application. [page629]

31The tenant appealed both decisions to this court on the grounds that the Board lacked jurisdiction to hear the applications, given his claim that he was a co-owner. The court upheld both decisions of the Board, one of which made a determination of ownership.

32In Warraich 1, at paras. 16-19, the court found that the Board had jurisdiction to hear the eviction application, and that its jurisdiction extended to the determination of whether the appellant was a "tenant" and the respondent was a "landlord" as defined in the RTA.

33In Warraich v. Choudhry, [2018] O.J. No. 1068, 2018 ONSC 1267 (Div. Ct.), at paras. 41 and 57 ("Warraich 2"), the court rejected the argument that the Board erred in law or exceeded its jurisdiction in determining that the appellant was not a co-owner of the property. Rather, the court found that the Board made its determination for the purpose of deciding whether the appellant was a "tenant" within the meaning of the RTA and not to address any rights or obligations flowing from an ownership interest. Determinations made for such a limited purpose are not binding on a court and a party is not prejudiced.

34As of the date of this hearing, there was no extant application initiated in the Superior Court to determine the ownership issue. Rather, the appellant chose not to seek court determination of ownership for reasons that were not explained in the record. In any event, in my view, the appellant is not prejudiced from prosecuting the ownership issue in other contexts because the finding of the Board was made solely for the purpose of determining what constituted the "rental unit" within the meaning of the RTA.

Was the appellant denied procedural fairness by the Board assuming jurisdiction over the ownership issue?

35To recall, no standard of review analysis is necessary on this issue. A decision is either procedurally fair or it is not.

36If, as the appellant now argues, he felt that his procedural rights were compromised by the interim order made by the Board assuming jurisdiction of the ownership issue and directing the manner by which it would be determined, he was obligated to make those objections to the Board, not wait until the appeal to raise his fairness concerns. As this court said in Bart v. McMaster University (2016), 133 O.R. (3d) 592, [2016] O.J. No. 4923, 2016 ONSC 5747 (Div. Ct.), at para. 151, to find otherwise would "encourage applicants to make a tactical choice of holding onto a potential ground for judicial review [or appeal] and raising it only if they receive an unfavourable decision". [page630]

37In this case, following the issuance of the interim order, the appellant did not assert that the Board lacked jurisdiction, nor did he object to its direction regarding how the evidence was to be presented to determine the issue. Rather, the appellant participated fully in providing written submissions to the point of being given the opportunity to file a reply to the respondents' materials. Having received an unfavourable decision from the Board, the appellant raised his fairness concerns for the first time in this appeal.

Did the Board err in law in deciding the ownership issue by failing to apply the common law concerning the ownership of fixtures attached to land and/or by admitting unreliable hearsay evidence?

38The appellant argues further in the alternative that if the Board did have jurisdiction to decide the ownership issue, it made two errors of law in making that decision: (1) it failed to apply the common law concerning the ownership of fixtures attached to land; and (2) it admitted unreliable hearsay evidence. I disagree on both counts.

39Validly enacted legislation is paramount over the common law. The Legislature can offer an exhaustive account of the law in an area (a code) which occupies the field in that area, displacing the common law rules and cutting off further common law evolution: see Ruth Sullivan, Sullivan on the Construction of Statutes, 6th ed. (Markham: LexisNexis, 2014), at 17.4; see also Bank of Montreal v. Innovation Credit Union, [2010] 3 S.C.R. 3, [2010] S.C.J. No. 47, 2010 SCC 47, at paras. 53-54.

40Mobile home and land lease home tenancies were not originally protected by residential tenancies legislation. The RTA now deals extensively and in detail with land lease homes. For example, s. 3(1) of the RTA codifies the Legislature's intent that the RTA take precedence over conflicting legislation, and s. 3(3) shows a particular concern for protecting the ownership interests of tenants who are land lease owners, where it says:

3(1) This Act, except Part V.1, applies with respect to rental units in residential complexes, despite any other Act and despite any agreement or waiver to the contrary.

(3) In interpreting a provision of this Act with regard to a mobile home park or a land lease community, if a provision in Part X conflicts with a provision in another Part of this Act, the provision in Part X applies.

41By including the concept of permanency in the definition of a land lease home, the Legislature expressly addressed characteristics that would otherwise be relevant in determining [page631] whether a structure is land or chattel, and thus who it belongs to. For example, in the cases of Haggert v. Brampton (Town) (1897), 1897 14 (SCC), 28 S.C.R. 174, [1897] S.C.J. No. 73, and Stack v. T. Eaton Co. (1902), 4 O.L.R. 335, [1902] O.J. No. 155 (Div. Ct.), as cited by the appellant, the intention that a structure be permanent was a determinative factor in finding whether the structure is a chattel or part of the land.

42As the respondents contend, the compounded effect of the history of reform and the comprehensive nature of the RTA itself shows the Legislature codified the law in the residential tenancies context, so the common law in respect of fixtures does not apply. I agree.

43Further, to adopt the appellant's argument on the matter would make a land lease home the property of the land lease community as soon as it was affixed to its location or connected to services, thus defeating the purpose of this new regime and these new rights. Moreover, the Legislature's intent to preserve the right to sell "permanent" land lease homes would be frustrated, as would its scheme establishing the circumstances in which the landlord can sell, retain for the landlord's own use, or dispose of the land lease home.

44The Statutory Powers Procedure Act, R.S.O. 1990, c. S.22, as amended ("SPPA") applies to all proceedings before the Board. The SPPA confirms the Board's power to control its own process and to consider all relevant evidence at s. 15(1), where it says:

15(1) Subject to subsections (2) and (3), a tribunal may admit as evidence at a hearing, whether or not given or proven under oath or affirmation or admissible as evidence in a court,

(a) any oral testimony; and

(b) any document or other thing,

relevant to the subject-matter of the proceeding and may act on such evidence, but the tribunal may exclude anything unduly repetitious.

45The appellant argues that the Board admitted unreliable hearsay evidence first, by relying on the testimony of Ms. Riddle Patterson that Mr. Riddle told her he purchased the cottage from Lajja Mohan, and second, by accepting into evidence an unsworn letter from Mr. Riddle confirming that he purchased the cottage from Lajja Mohan. In my view, s. 15 of the SPPA entitled the Board to admit and rely on the impugned evidence.

Did the Board's admission of hearsay evidence result in a breach of procedural fairness?

46As said above, the Board has explicit authority to choose its own procedure, and to make orders with respect to procedures [page632] in any proceeding: RTA, ss. 1, 183 and 201(1)(d). If the appellant had fairness concerns regarding the nature and quality of the evidence admitted by the Board, he was obligated to make those objections to the Board, not wait until the appeal to raise his concerns. Had the appellant raised his concerns with the Board, the Board could have ordered cross-examinations of Ms. Riddle Patterson and Mr. Riddle to test the evidence that the appellant now complains of. Further, the Board might have considered reconvening the hearing in person for the evidentiary issues to be addressed by oral submissions. These are just two possible remedies. There are likely others.

Conclusion

47For these reasons, I find that the appeal should be dismissed. The respondents agreed that if they were successful on the appeal, they were only seeking costs in the amount of $500. It is so ordered. The Board sought no costs.

Appeals dismissed.

End of Document

Sutton v. Riddle, 2021 ONSC 1403

Case Summary

Overview

Factual Background

Issues Raised

Standard of review

Did the Board have jurisdiction to decide the ownership issue?

Was the appellant denied procedural fairness by the Board assuming jurisdiction over the ownership issue?

Did the Board err in law in deciding the ownership issue by failing to apply the common law concerning the ownership of fixtures attached to land and/or by admitting unreliable hearsay evidence?

Did the Board's admission of hearsay evidence result in a breach of procedural fairness?

Conclusion

Sutton v. Riddle, 2021 ONSC 1403

Case Summary

Overview

Factual Background

Issues Raised

Standard of review

Did the Board have jurisdiction to decide the ownership issue?

Was the appellant denied procedural fairness by the Board assuming jurisdiction over the ownership issue?

Did the Board err in law in deciding the ownership issue by failing to apply the common law concerning the ownership of fixtures attached to land and/or by admitting unreliable hearsay evidence?

Did the Board's admission of hearsay evidence result in a breach of procedural fairness?

Conclusion

Cited By (1 case)

Hamad v. Dominion of Canada General Insurance Company, 2024 ONSC 3324

Cited By (1 case)

Hamad v. Dominion of Canada General Insurance Company, 2024 ONSC 3324