Zhou v. Rama, 2021 ONSC 4659

CITATION: Zhou v. Rama, 2021 ONSC 4659

DIVISIONAL COURT FILE NO.: 385/21

DATE: 20210629

SUPERIOR COURT OF JUSTICE – ONTARIO

DIVISIONAL COURT

RE: hao zhou, Landlord/Respondent on Appeal/Moving Party

AND:

rajendra rama, Tenant/Appellant/Responding Party on Motion

BEFORE: Favreau J.

COUNSEL: Paul H. Starkman, for the Moving Party/Landlord

Rajendra Rama, the Responding Party/Tenant, representing himself

HEARD at Toronto (by videoconference): June 28, 2021

ENDORSEMENT

FAVREAU J.

Introduction

1The Landlord brings a motion to quash the Tenant’s appeal from an eviction order made by the Landlord and Tenant Board or alternatively to lift the automatic stay on eviction granted by the Divisional Court. The Landlord argues that the appeal is devoid of any merit and that it is an abuse of process because the Tenant has consistently not paid rent in over a year.

2For the reasons below, I find that the appeal is devoid of any merit and that it is an abuse of process. Accordingly, the appeal is quashed and the stay on eviction is lifted in accordance with the directions below.

Background facts

3The Landlord and the Tenant entered into a lease commencing on May 22, 2019. The lease required the Tenant to pay monthly rent in the amount of $1000 at the beginning of every month.

4The Tenant did not pay any rent in June 2020. On July 1, 2020, the Landlord served a N4 Form on the Tenant which gave notice to the Tenant that he was required to pay June and July 2020 rent in the amount of $2,000 failing which the Landlord may take enforcement proceedings. The Tenant did not pay the required rent and the Landlord then brought an application to the Landlord and Tenant Board.

5Due to the COVID-19 pandemic, the hearing before the Board did not take place until February 18, 2021. By that time, it is undisputed that the Tenant had paid no rent between June 2020 and February 2021.

6The hearing proceeded by videoconference. The Landlord was represented by an agent at the hearing. At the beginning of the hearing, the Tenant was given an opportunity to speak to duty counsel. However, the Tenant was not on the line when the hearing resumed. The hearing proceeded without the Tenant.

7In a decision released on April 14, 2021, the Board granted the Landlord’s application, and made an order requiring the Tenant to pay $9,466.68 by April 25, 2021, failing which the Landlord could file the order with Sheriff’s Office as of April 26, 2021.

8In its decision, the Board made the following findings:

I have considered all of the disclosed circumstances in accordance with subsection 83(2) of the Residential Tenancies Act, 2006 (the ‘Act’), and find that it would be unfair to grant relief from eviction pursuant to subsection 83(1) of the Act. The Tenant did not attend the hearing to present evidence or submissions in support of granting relief from eviction and no circumstances were disclosed at the hearing or appeared in the Board file. The Landlord presented evidence that they attempted to negotiate a repayment agreement with the Tenant.

9On May 14, 2021, the Tenant commenced an appeal and obtained an automatic stay of the eviction order from the Divisional Court. As part of the stated grounds of appeal, the Tenant says that he did not have a chance to participate in the hearing.

Procedural background and reasons for denying adjournment

10The parties participated in a case management conference with Corbett J. on June 4, 2021. In his endorsement following the case conference, Corbett J. required the Tenant to pay $1,000 for June 2021 rent by June 11, 2021 and ongoing rent in the amount of $1,000 starting July 1, failing which the Landlord could obtain an order lifting the stay of eviction “forthwith”. Corbett J. also scheduled the Landlord’s motion to quash the appeal on June 28, 2021. The endorsement required the Landlord to serve motion materials by June 14, 2021 and the Tenant to serve responding materials by June 24, 2021.

11Late on the afternoon of Friday, June 25, 2021, the Tenant wrote to the Divisional Court advising that he had not been able to prepare his responding materials and that he intended to seek an adjournment because he was unwell. His communications to the Court included a note from a doctor stating “Mr. Rama is unfit for work from 23-26th June 2021 inclusive due to flair [sic] up of his sciatica”.

12The Court directed the Tenant to phone into the hearing on the morning of June 28th and advised that he could make his request for an adjournment at that time.

13After hearing submissions from the Tenant and counsel for the Landlord, I denied the adjournment. I advised the parties that my reasons for denying the adjournment would be included in my reasons on the motion. My reasons for denying the adjournment are as follows:

a. The doctor’s note does not support the request for an adjournment. The note only refers to the Tenant not being able to work due to sciatica. This provides no information about the specific limitations the Tenant may have arising from the sciatica and how they may prevent him from preparing materials in response to the motion. In addition, the Tenant’s materials were due on June 24, 2021. The note only states that he has had limitations since June 23, 2021. There is no evidence that the Tenant was unable to prepare responding materials in the time period between when he received the Landlord’s materials up to June 23, 2021.

b. The adjournment request came at the last minute, late on the Friday afternoon before the hearing scheduled to start on Monday, with no explanation for the delay in requesting an adjournment, other than an indication that the Tenant had some difficulties in obtaining a doctor’s note.

c. In his submissions in support of the request for an adjournment, the Tenant did not indicate what, if any, additional materials or information he would put forward in response to the motion that could affect the outcome.

d. While the Court will generally grant reasonable requests for an adjournment, I am not satisfied that granting the requested adjournment was appropriate or fair to the Landlord in the circumstances of this case.

14In any event, despite the request for an adjournment, I am satisfied that the Tenant was prepared to argue the issues on the motion. While he did not file a formal responding record or factum, he did provide the Court with some documents in support of his position in advance of the motion, including the transcript from the hearing at the Board, the N4 Form and a newspaper article dealing with residential tenancies during the pandemic.

Analysis

15The Landlord brings this motion to quash the appeal or, alternatively, lift the stay on the following two grounds:

a. The appeal is devoid of any merit; and

b. The appeal is an abuse of process.

16In my view, the appeal is devoid of merit and is an abuse of process, and should therefore be quashed on both grounds.

The appeal is devoid of merit

17Section 134(3) of the Courts of Justice Act, R.S.O 1990, c. C.43, gives a court to which an appeal is brought the power to quash the appeal. The test for quashing an appeal is whether it is manifestly devoid of merit: Schmidt v. Toronto Dominion Bank (1995), 24 O.R. (3d) 1 (C.A.), at para. 6. In Schmidt, the Court of Appeal held that this power is to be exercised sparingly because it "is very difficult, in most cases, to reach the conclusion that an appeal is devoid of merit without hearing the entire appeal".

18Pursuant to section 210(1) of the Residential Tenancies Act, 2006, an appeal from a decision of the Board lies to the Divisional Court, but only on a question of law. While the bar is generally high for quashing an appeal on the basis that it is devoid of merit, it is appropriate to quash an appeal from an order of the Board where the appeal does not raise a question of law: see, for example, Solomon v. Levy, 2015 ONSC 2556 (Div. Ct.), at paras. 33-34; and Mahdieh v. Chen, 2019 ONSC 4218 (Div. Ct.), at para. 8.

19In Canada (Director of Investigation & Research) v. Southam Inc., [1997] 1 S.C.R. 748, at para. 35, the Supreme Court of Canada explained that “questions of law are questions about what the correct legal test is”.

20In this case, as stated above, the notice of appeal raises an issue of procedural fairness. In addition, in his oral submissions on the motion, the Tenant argued that the Board did not have the authority to grant the eviction order because of defects in the N4 Form.

21With respect to the issue of procedural fairness, the Tenant argues that he was initially present at the hearing, but that he was cut off when he tried to dial in again. The Tenant relies on the transcript in support of this position. The Tenant also states that the Board’s decision makes no reference to his initial participation in the hearing.

22I have reviewed the transcript, which shows the following:

a. All parties were on the line around 9:10 am, at which time the Tenant requested an opportunity to speak to duty counsel. The Board granted the request and told the Tenant to dial back in once he had done so.

b. At 9:50, the Board reconvened the hearing. At that time, the Tenant was on the line but the Landlord’s representative asked for an opportunity to send the Board updated documents. The Board granted the request.

c. Around 11:00, the hearing reconvened and the Tenant is not shown as participating. The Landlord’s representative said that he called the Tenant but he was not present. The hearing then proceeded without the Tenant.

d. At 11:37, the Tenant dialed in and said that he was able to hear the earlier proceeding but not able to participate. He asked for an opportunity to make submissions but the Board Member told him that the hearing is complete.

23Procedural fairness is a question of law. While there may be valid arguments that the hearing was procedurally fair, I am not prepared to find on a preliminary basis that the Tenant’s argument that the hearing was procedurally unfair is completely devoid of merit. While the Board is entitled to control its own process, in this case it appears that the Board made little effort to ensure that the Tenant had an opportunity to be heard. The Tenant dialed in three times. It is evident that he intended to participate in the hearing. It was inaccurate for the Board to state in its decision that the Tenant had notice of the hearing but failed to show up.

24However, while I find that the appeal raises a legitimate issue of procedural fairness, this does not end the inquiry. Even if the Tenant had been able to participate in the hearing, he has provided no evidence or arguments to show that he could have succeeded in responding to the application before the Board if he had participated. Notably, he does not contest that he did not pay any rent for an extended period of time and he does not contest the amount of rent owing.

25On the motion before me, the Tenant argued that the Board should have dismissed the application because of deficiencies in the N4 Form. The Form, which was served on July 1, 2020, referred to unpaid rent on June 1 and July 1, 2020. The Tenant argues that it was premature for the Form to make reference to the July 1 rent as unpaid. This argument appears to have little merit given that the N4 Form did refer to June 1st rent, which had not been paid, and that by the time the matter went before the Board, the Tenant had paid no rent for many months.

26During the motion, when I asked the Tenant about what arguments he would have presented at the Board to justify his failure to pay rent, he said that he would have provided proof of his bad financial circumstances. However, the Residential Tenancies Act, 2006 does not contemplate that poor financial circumstances provide an excuse for paying no rent for a persistent period of time. The Tenant also relied on a news article dated March 20, 2020 referring to a statement by the Premier about people not being evicted during the pandemic due to their inability to pay rent. Again, this does not provide an excuse for paying no rent for a persistent period of time.

27At most, had the Tenant participated in the hearing before the Board, he may have been able to present evidence that would have led to a lengthier period of time for paying the outstanding amount owed. However, the persistent non-payment of rent would nevertheless have led to an eviction order with an opportunity to avoid the eviction by paying arrears.

28In the circumstances, while the proposed appeal does raise an issue of procedural fairness, in the absence of any legitimate justification for persistently paying no rent for many months, I am satisfied that the appeal is devoid of any merit.

The appeal is an abuse of process

29Even if I was persuaded that the appeal had some merit, I would quash it as an abuse of process.

30This Court has repeatedly held that it is an abuse of process for a litigant to commence an appeal from an order of the Board for the sole purpose of obtaining an automatic stay of an eviction order, otherwise referred to as “gaming the system”: Regan v. Latimer, 2016 ONSC 4132 (Div. Ct.), at para. 25; and Wilkinson v. Seritsky, 2020 ONSC 5048 (Div. Ct.) at para. 34. One of the key indicia that a Tenant is trying to “game the system” is where the Tenant has failed to pay rent for a persistent and lengthy period of time without a reasonable explanation or any intention to remedy the situation: Wilkinson, at para. 34.

31In this case, the Tenant has persistently failed to pay his rent. At the time of the hearing before the Board, the Tenant had failed to pay any rent between June 2020 and February 2021. By the time of the case conference before Corbett J., he had not paid any rent for a full year. He has recently paid rent for June 2021 in the face of a potential immediate eviction. The outstanding amount owed is now well in excess of $10,000.

32As mentioned above, in support of his appeal, the Tenant raises issues about his inability to participate in the hearing before the Board and defects in the N4 Form. However, he has provided no satisfactory explanation or justification for paying no rent for over one year.

33In his notice of appeal, the Tenant appears to justify his failure to pay rent on the basis of vague allegations that the Landlord harassed him and withheld internet service. While these issues may justify rent abatement or other remedies, the landlord and tenant regime is not a self-help regime. The Residential Tenancies Act, 2006 gives tenants different avenues for obtaining relief against Landlords who fail to meet their obligations. However, persistently failing to pay any rent is not one of those avenues. In any event, it is hard to imagine that any of these issues would lead to 100% rent abatement.

34In the circumstances, I am satisfied that the appeal is an abuse of process, brought for the purpose of obtaining an automatic stay of eviction.

Remedy

35At the hearing, the Landlord suggested that a fair outcome would be for the Court to give the Tenant an opportunity to pay all outstanding arrears by a specified date, failing which the appeal would be quashed and the stay lifted.

36In response, the Tenant said that he was not in a position to pay the outstanding arrears for several months. Instead, he suggested that he pay July rent and be allowed to stay in the rental until until the end of July, after which he would vacate the apartment but be allowed to pursue his appeal.

37Given the Tenant’s admission that he could not pay arrears for many months, the Landlord’s proposal has no utility. In terms of the Tenant’s proposal, given my finding that the appeal is devoid of merit and an abuse of process, I am quashing the appeal. However, I am prepared to give the Tenant the opportunity to spend another month in the rental unit provided he does pay rent by July 1, 2021. The specific terms of my order are set out below.

Conclusion

38For the reasons above, I make the following order:

a. The appeal is quashed;

b. The stay on enforcement of the eviction order will be lifted on August 1, 2021 if the Tenant pays rent in the amount of $1,000 by July 1, 2021 in accordance with Corbett J.’s order;

c. If the Tenant fails to pay $1,000 by July 1, 2021, the stay on enforcement of the eviction will be effective on July 2, 2021; and