COURT OF APPEAL FOR ONTARIO

CITATION: Fernandez v. Unique Auto Collision Network Solutions Corp., 2014 ONCA 458

DATE: 20140610

DOCKET: M43881

Pardu J.A. (In Chambers)

BETWEEN

Frank Fernandez and Anna Maria Fernandez

Respondents

and

Unique Auto Collision Network Solutions Corp., Cansom Holdings Inc., Peter Collia, Giacomo Collia, and Antonitta Collia

Moving parties/Appellants

Yusuf Barre, for the moving parties

Miranda Spence, for the respondents

Heard: June 9, 2014

On motion for orders allowing Yusuf Barre to represent Unique Auto Collision Network Solutions Corp and Cansom Holdings Inc., for orders granting leave to appeal and extending the time to appeal the judgment of Justice Stephen E. Firestone of the Superior Court of Justice, dated June 14, 2013 and the report of Master Graham dated February 19, 2014 and for stays of enforcement of the judgment and the writ of possession pending the appeal.

ENDORSEMENT

[1] Unique Auto Collision Network Solution Corp and Cansom Holdings Inc. move for orders allowing Yusuf Barre to represent them, for orders granting leave to appeal and extending the time to appeal the judgment given in a mortgage action, a report of a Master determining the amounts owing and for stays of enforcement of the judgment and the writ of possession pending the appeal.

[2] Yusuf Barre says he is the sole shareholder of the two corporations, and on that basis I grant leave for him to make submissions on their behalf.

[3] The statement of claim seeking possession and monies owing on the maturity of two vendor take back mortgages was issued on November 14, 2012. The statement of claim is in form 14B prescribed by the Rules of Civil Procedure and also seeks foreclosure. Judgment for the money owing was granted in favour of the mortgagees on June 14, 2013, subject to a reference to determine the amounts. The moving parties were ordered to pay the amounts determined by the reference within 60 days of confirmation of the report on the reference.

[4] On February 19, 2014 Master Graham delivered reasons on the reference, determining that $180,444.36 was owing on the 42 Hyde Avenue property, and $307,876.62 was owing on the 44 Hyde Avenue property. Mr. Barre acknowledges that the mortgages have come due, and that money is owing, but takes issues with the amounts allowed by Master Graham to the mortgagees for legal fees related to past enforcement actions, in the sum of $23,934.65 for each of the mortgages. Including the disputed amount for legal fees the amounts owing on the two mortgages now total $522,248.98.

[5] On May 5, 2014 an order was given without notice granting leave to issue a writ of possession.

[6] Mr. Barre has sued the mortgagees for problems related to the condition of the premises sold to them, which action is proceeding to trial.

[7] Mr. Barre indicated for the first time on April 17, 2014 that he intended to appeal and indicated that he was seeking a date for a motion to extend the time for appeal. The motion before me asks for leave to appeal to the Court of Appeal, and stay of enforcement of the writ of possession pending the appeal. The motion is brought on an emergency basis on short notice, with the enforcement officer standing by.

[8] There is insufficient material in the record to determine when the reference report was confirmed. Mr. Barre was present when the Master’s report was given orally, and it appears from that report that the Master intended to send copies of the transcript of his report to the parties. Mr. Barre states in his notice of motion that he received the report in late May 2014. The respondents’ record includes affidavits of service of the judgment of Firestone J., the report of the Master and a Notice Demanding Possession upon the moving parties on April 21, 2014. The Notice Demanding Possession asserts that the mortgagee has obtained judgment entitling it to immediate possession of the lands, but no such judgment is appended.

[9] Rule 64.06 (1) provides that Rule 55 applies to a reference in an action for foreclosure, and Rule 64.06 (3) (d) provides that a referee may take an account of what is due on the mortgage.

[10] Rule 54.01 provides that Rules 54 and 55 apply to references directed under any other rule.

[11] Rule 54.09(1) (b) provides:

Where the order directing a reference does not require the referee to report back, the report is confirmed,

(b) on the expiration of fifteen days after a copy, with proof of service on every party who appeared on the reference, has been filed in the office in which the proceeding was commenced, unless a notice of motion to oppose confirmation of a report is served within that time. O. Reg. 396/91, s. 10.

[12] According to Rule 54.09 (3):

A notice of motion to oppose confirmation of a report shall,

(a) set out the grounds for opposing confirmation;

(b) be served within fifteen days after a copy of the report, with proof of service on every party who appeared on the reference, has been filed in the office in which the proceeding was commenced; and

(c) name the first available hearing date that is at least three days after service of the notice of motion.

[13] Here it does not appear that the moving parties brought any motion pursuant to Rule 54.09(3) to oppose confirmation of the report. Rule 54.07 provides that a report has no effect until it has been confirmed and that a report shall be entered immediately after it has been confirmed and Rule 59.05 (entry of order) applies, with necessary modifications. There is nothing in the record before me to indicate whether the report has been entered.

[14] A motion to oppose confirmation of a report is a hearing in the nature of an appeal. (Jordan v. McKenzie (1987), 26 C.P.C (2d) 193.) Following the hearing contemplated by Rule 54.09(3) there is a further right of appeal without leave to the Court of Appeal, for a second review of the merits of the initial report, and any subsequent decision on the motion opposing confirmation. (Capsule Investments Ltd. v. Heck 1993 CanLII 8465 (ON CA), [1993] 12 O.R. (3d) 225.

[15] The relevant factors to be considered in assessing whether to allow an extension of the time to appeal, and whether the justice of the case requires that an extension should be given, include:

• Whether the appellant formed an intention to appeal within the relevant period;

• The length of the delay and any explanation for the delay;

• Any prejudice to the respondent;

• The merits of the appeal.

[16] Here I would refuse leave to appeal to the Court of Appeal, as the moving parties have not pursued the right of appeal given by Rule 54.09(3). If the report has not been confirmed, the moving parties may move in the Superior Court to oppose confirmation of the report. If the report has been confirmed, then a motion to oppose confirmation could not be brought unless special leave is granted by the Superior Court. There is no right of appeal directly to the Court of Appeal from the report given on a reference. The moving parties say they also have appealed to the Divisional Court, however the record does not disclose the subject matter of that appeal.

[17] For the same reason I refuse the application for a stay of enforcement of the mortgage judgment, as there is no appeal properly before this Court on the issue of the amount owing on the mortgages. Given the acknowledge default on the mortgage, there is no chance that an appeal against the judgment of Firestone J. directing payment on money determined on a reference could be successful.

[18] Rule 63.02 provides that an order may be stayed either by order of the court whose decision is to be appealed, or by an order of a judge of the court to which a motion for leave to appeal has been made or to which an appeal has been taken. In the case of an attempted appeal from the findings on a reference, by motion to oppose confirmation, by analogy, that motion to stay would have to be before the Superior Court.

[19] In any event, I would not exercise discretion to stay enforcement of the writ of possession. The amount owing is substantial, and less than $48,000.00 is contested. The mortgagees depend on the mortgage payments which were to total about $3000.00 per month for their retirement income. No payments have been made on the mortgages since May 2012 except for a payment on March 5, 2013 totaling $3024. The moving parties failed to pay the property taxes and failed to insure the properties. The moving parties submit that loss of possession of the property will prevent them from operating a business there, but no details are given as to the nature of the business or income generated by the business. No information is contained in the record that would enable me to assess the magnitude of the moving parties’ action against the mortgagees, nor the likelihood of success.

[20] The moving parties offer to pay $400,000.00 into court within 30 days, but there is no assurance or objective evidence they has the ability to do so, and the amount offered is still substantially less than what appears to be owing, even after deduction of the contested costs.

[21] Finally, there is nothing before me to suggest that the writ of possession was improperly obtained. There is some authority to the effect that a judgment for possession must be granted before a writ of possession may issue. (National Bank v. Ehtisham (2010) ONSC 1528). In para. (e) of the moving parties’ Notice of Motion they ask “an alternative interim basis the operation of that part of the order that requires delivery of vacant possession of the mortgaged premises or granting stay from the sheriff to execute of eviction on June 09, 2014 and a writ of possession.”. There is authority that s. 106 of the Courts of Justice Act, empowering a court to grant a stay applies only to proceedings, and does not empower a court to stay enforcement of a writ of possession (Granville Savings & Mortgage Corp. v. Roccari, 1993 CarswellOnt 4091, Borins J.). In any event, on this record I cannot say whether or not judgment for possession was obtained by the mortgagees. If the moving parties are of the view that the writ of possession should not have been issued, the appropriate course would have been for them to move before the Superior Court to set aside the writ of possession. Rule 37.14 provides that a party affected by an order obtained on motion without notice may move to set aside the order by notice of motion served forthwith after the order comes to the person’s attention and names the first hearing date that is at least three days after service of the notice of motion. A court may set aside or vary the order on such terms as are just, but would undoubtedly take into consideration the right of the mortgagee to possession in light of the admitted default, with or without a motion by the mortgagees for judgment for possession.

[22] For these reasons, the motion is dismissed with costs to the respondents on the motion, fixed at $1500.00 payable in 30 days.

“G. Pardu J.A.”