Court of Appeal for Ontario

Citation: Rahawanji v. Gwendolyn Shop (1973) Ltd., 2011 ONCA 771

Date: 2011-12-07

Docket: C54204

Before: Blair, Epstein JJ.A. and Pardu J. (Ad hoc)

Between:

Souad Moh’d Ali Rahawanji and Samer Rahawanji Applicants (Appellants in appeal)

and

The Gwendolyn Shop (1973) Ltd. and 1659295 Ontario Ltd. Respondents (Respondents in Appeal)

Counsel:

Alexandra Lev-Farrell, for the applicants (appellant in appeal)

R. Barrett, for the respondents

Heard: December 5, 2011

On appeal from the decision of Justice John C. Murray of the Superior Court of Justice dated August 12, 2011.

APPEAL BOOK ENDORSEMENT

[1] The appellants seek to set aside the order of Murray J. dismissing their application for relief from forfeiture in relation to their tenancies of two commercial leases in a small shopping plaza in downtown Oakville. Ms. Lev-Farrell argues strongly on their behalf that the application judge erred in failing to take into account that relief from forfeiture is generally granted where all that is involved is the question of monetary arrears and in failing to address him mind to whether the default could be cured on terms in order to avoid the loss of their businesses.

[2] We do not agree. Relief from forfeiture is a discretionary remedy and is not granted as a matter of course. As Doherty J.A. noted in Ontario (Attorney General) v. 8477 Darlington Crescent, 2011 ONCA 363, at para. 93, both in civil and criminal cases:

Relief from forfeiture is very much the exception and will be granted only where the party seeking that remedy clearly makes the case that forfeiture would be an inequitable and unjust order in all the circumstances.

[3] This is particularly so with respect to a commercial lease. Here, we are satisfied that the application judge considered the relevant circumstances and he was particularly entitled to take into account the fact that the appellants had not proceeded to the hearing of the application in a timely fashion and that they had not paid any rent in the meantime in spite of the landlord’s offer to accept payment on a without prejudice basis. There were arrears of seven month’s rent at the time of the hearing. In addition, there is no evidence of any real prejudice to the appellants if relief from forfeiture is not granted in the sense that that, in itself, would result in the demise of their businesses.

[4] Accordingly, we see no error in the exercise of the application judge’s discretion and the appeal is dismissed.

[5] The appellants have requested time to relocate. We are advised that rent has now been paid to the end of December as one of the terms of the appeal. Provided the rent for the two units for the month of January is paid to the landlord by December 17, 2011, the appellants shall be entitled to remain in the premises under the terms of the leases until January 31, 2012. Failing payment of the January rent on those terms, the appellants must vacate by December 31, 2011.

[6] Costs of the appeal to the respondent, fixed in the amount of $5000 all inclusive. The costs are to be paid by December 17, 2011 as well, as a term of the appellants’ continued occupation until January 31, 2012.