Court and Parties

Court of Appeal for Ontario Date: 2021-03-04 Docket: C68375 and C68539

Between: Mandeep Dhatt and Kulwinder Dhatt Plaintiffs (Respondents)

And: Derek Beer and Indira Beer Defendants (Appellants)

And: Jay Brijpaul and Re/Max West Realty Inc., Brokerage Third Parties (Respondents)

Counsel: David P. Lees and Zachary Silverberg, for the appellants Arnie Herschorn, for the respondents, Mandeep Dhatt and Kulwinder Dhatt Serena L. Rosenberg, for the respondents, Jay Brijpaul and Re/Max West Realty Inc.

Heard: February 10, 2021 by video conference

On appeal from the judgment and order of Justice Carole J. Brown of the Superior Court of Justice, dated May 1, 2020 and July 30, 2020, respectively, with reasons for judgment reported at 2020 ONSC 2729.

Coram: Strathy C.J.O., Brown and Miller JJ.A.

BROWN J.A.:

I. OVERVIEW

[1] This appeal raises two main issues. First, did the trial judge unreasonably exercise her discretion by refusing the requests of the appellants, Derek Beer and Indira Beer, to adjourn the trial? Second, did the trial judge err in granting the respondents, Mandeep Dhatt and Kulwinder Dhatt, specific performance of the January 22, 2016 agreement of purchase and sale to buy the Beers’ Brampton residential property (the “Agreement”)?

[2] When the Beers refused to close the Agreement, the Dhatts sued for specific performance. The Beers defended, pleading that the Agreement was invalid. They brought a third party claim against their real estate agent, Jay Brijpaul, and his brokerage, Re/Max West Realty Inc., Brokerage (the “Re/Max Third Parties”).

[3] By judgment dated May 1, 2020 (the “Judgment”), the trial judge granted the Dhatts specific performance and dismissed the third party claim. By order dated July 30, 2020, the trial judge appointed a lawyer to act for the Beers and close the transaction (the “Transaction Order”).

[4] The Beers appeal both the Judgment and the Transaction Order.

[5] By order dated August 28, 2020, Zarnett J.A. refused to stay the Judgment and Transaction Order pending appeal: Dhatt v. Beer, 2020 ONCA 545, 449 D.L.R. (4th) 263. As a result, the Dhatts took possession of the property in September 2020, but the closing of the transaction awaits the disposition of these appeals.

[6] The Beers raise three grounds of appeal, arguing that the trial judge erred in:

(i) refusing to grant them an adjournment of the trial; (ii) granting the Dhatts specific performance; and (iii) awarding substantial indemnity costs against them.

[7] For the reasons set out below, I would dismiss the appeal.

II. FIRST GROUND OF APPEAL: THE REFUSAL TO ADJOURN THE TRIAL

[8] The Beers submit that the trial judge failed to exercise her discretion judicially by refusing their request for an adjournment on the first day of trial and refusing their subsequent requests for an adjournment on medical grounds.

[9] I see no error by the trial judge in exercising her discretion that would merit appellate intervention.

A. The governing principles

[10] A judge may postpone or adjourn a civil trial to such time and place, and on such terms, as are just: Rules of Civil Procedure, r. 52.02. The principles governing a trial judge’s exercise of that discretion were set out in the majority and dissenting reasons in Khimji v. Dhanani (2004), 69 O.R. (3d) 790 (C.A.). Both must be read together. In his dissent, Laskin J.A. summarized several of the main principles, at para. 14:

A trial judge enjoys wide latitude in deciding whether to grant or refuse the adjournment of a scheduled civil trial. The decision is discretionary and the scope for appellate intervention is correspondingly limited. In exercising this discretion, however, the trial judge should balance the interests of the plaintiff, the interests of the defendant and the interests of the administration of justice in the orderly processing of civil trials on their merits. In any particular case several considerations may bear on these interests. A trial judge who fails to take account of relevant considerations may exercise his or her discretion unreasonably and if, as a result, the decision is contrary to the interests of justice, an appellate court is justified in intervening.

The majority, Doherty and Catzman JJ.A., added a further factor stating, at para. 27:

I have had the privilege of reading the lucid reasons of Laskin J.A. I adopt his summary of the facts and his statement of the principles governing this appeal. I would only add that in determining whether to grant an adjournment in this case, the trial judge had to consider not only the orderly processing of civil trials, but the need to effectively enforce court orders. I think the refusal of the adjournment in this case was justified principally because the appellant all but ignored the order of the court made in November. He made virtually no attempt to retain a lawyer who could act for him on the scheduled trial date, or to pay even part of the costs order made against him. [1]

[11] Those general principles must be applied with a stance of deference to the front-line trial judge. As stated by the majority in Khimji, at para. 36:

This court sits at a distance from the day-to-day operation of trial courts. That distance must impair this court's ability to review decisions such as the one under appeal. Strong deference is due to the decision of those in the trial courts who are responsible for the day-to-day maintenance of an efficient and just system of civil trials.

[12] Since Khimji was decided in 2004, an increasing degree of pre-trial case management has been applied to civil actions in the Superior Court of Justice. One object of the pre-trial case management process is to ensure that parties meet the trial date set for their action.

[13] The trial of the present action was subject to the Toronto Region’s “Consolidated Practice Direction for Civil Actions, Applications, Motions and Procedural Matters in the Toronto Region”, (July 1, 2015). Section 71 deals with trial dates, stating that: “Once trial dates are set, there will be no adjournments of the trial except in extenuating and exceptional circumstances .” [Emphasis added.]

B. The refusal of the adjournment request on the first day of trial

The issue stated

[14] The Beers had been represented by counsel until April 2018, when their lawyer got off the record due to non-payment of accounts. At a November 2018 Trial Scheduling Court, Mr. Beer stated that he would retain counsel.

[15] The matter was put over to the January 2019 Trial Scheduling Court. At that time, Mr. Beer advised that the defendants had not retained counsel. Nor had they filed the third party record as they had been ordered to do in November 2018. The presiding judge scheduled the 10-day trial for March 2, 2020 and ordered the third party record to be filed within 60 days. The Beers failed to do so.

[16] At a December 2019 pre-trial conference, the Beers were ordered to: (i) file the third party record by year’s end; (ii) advise by January 6, 2020 whether they planned to retain counsel and, if so, who; and (iii) provide a list of their witnesses by that date. The Beers did not comply with those orders.

[17] A week before the trial was to start, the Beers retained a lawyer with the limited mandate of requesting an adjournment of the trial (the “Adjournment Counsel”). That lawyer appeared on the first day of the trial. Adjournment Counsel explained his limited mandate and made it clear that even if an adjournment was granted, the Beers would likely be representing themselves.

[18] The main ground advanced for an adjournment was that the Beers’ former lawyer had been asserting a solicitor’s lien over the file and its documents for the better part of two years, as a result of which the Beers had few relevant documents. The former lawyer had obtained judgment for the amount due under the accounts. Adjournment Counsel informed the court that the Beers could not pay their former lawyer.

[19] At the same time, Adjournment Counsel advised that another lawyer of the Beers, who had acted for them in the enforcement proceedings brought by their former lawyer, also had some documents but he had not been able to reach that lawyer.

[20] Adjournment Counsel requested an adjournment until the Beers had dealt with the matters involving their former lawyer, including a pending sheriff’s sale of the Brampton property in satisfaction of their former lawyer’s judgment. Adjournment Counsel’s instructions only permitted him to advise the court that the Beers were “willing and able to cooperate in scheduling new dates for the trial.” In essence, the Beers were requesting an indefinite adjournment to no fixed date.

[21] The adjournment was opposed by the Dhatts and the Re/Max Third Parties, especially given the failure of the Beers to propose a definite date for the resumption of the trial. The trial judge refused to grant an adjournment, stating in her ruling:

Not until last week did [the Beers] retain counsel, but only for the limited purpose of seeking an adjournment. Even were an adjournment granted, the situation would ultimately be the same, namely that the defendants would be self-represented.

The defendants have known for two years that they should retain counsel but did so only at the very last moment and only for the limited purpose of seeking an adjournment.

I am not satisfied that in all of the circumstances, an adjournment should be granted. The trial will proceed.

[22] Given the representation by Adjournment Counsel that the Beers lacked the documents needed for the trial, the trial judge ordered that “the plaintiff and third party provide their briefs of documents to the defendants by the end of the day today. We will proceed with the trial tomorrow at 11 AM.”

Analysis

[23] The Beers submit that the trial judge erred in refusing to grant their request for an adjournment on the first day of trial for two reasons. First, it was only their first request for an adjournment. Second, the Beers were self-represented and the denial of an adjournment was inconsistent with the trial judge’s duty to self-represented litigants to acquaint them with courtroom procedure and the rules of evidence so that they received a fair trial: Morwald-Benevides v. Benevides, 2019 ONCA 1023, 148 O.R. (3d) 305, at para. 34.

[24] I see no merit in either submission.

[25] If at some time in the past there was a sense that a party had some sort of presumptive entitlement to one adjournment of a set trial date, those days are long gone. As the Toronto Region Practice Direction clearly states, once a trial date is set, there will be no adjournment of the trial “except in extenuating and exceptional circumstances.” The responsibility squarely falls on the party requesting an adjournment of a set trial date to demonstrate extenuating and exceptional circumstances.

[26] Second, although a trial judge does have a duty to ensure self-represented parties receive a fair trial, as pointed out by the majority in Khimji a self-represented litigant’s refusal to comply with pre-trial orders and failure to use time granted by the court to find a lawyer, may weigh heavily against that litigant’s request for an adjournment of a set trial date.

[27] As well, the Canadian Judicial Council’s 2006 Statement of Principles on Self-represented Litigants and Accused Persons, endorsed by the Supreme Court of Canada in Pintea v. Johns, 2017 SCC 23, [2017] 1 S.C.R. 470, at para. 4, states, at p. 9, that self-represented persons are expected to familiarize themselves with the relevant legal practices and procedures pertaining to their case and respect the court process. The Statement notes that judges have no obligation to assist a self-represented person who makes no reasonable effort to prepare their own case: at p. 6, Section C, Principle 4.

[28] Further, the following statement by the majority of this court in Khimji, at para. 35, applies equally to parties represented by counsel and those who are self-represented:

Individual litigants have a right to pursue and defend their respective claims. They must do so, however, within a court structure that must accommodate thousands of individual litigants. That system can function effectively only when litigants take scheduling commitments seriously and make genuine efforts to comply with court orders relating to adjournments and related matters.

[29] In the present case, the Beers had been given lengthy advance notice of the trial date and ample time to retain a lawyer; they had the better part of two years to make arrangements to obtain relevant trial documents from opposing counsel; the action had been marked peremptory to the Beers; the Beers retained a lawyer at the last minute only for the limited purpose of seeking an adjournment of the trial date; they did not propose a new trial date; they failed to comply with the orders of the court to file a third party record and deliver a list of witnesses; and they made no reasonable effort to prepare their case. Given those facts, I see absolutely no error in the trial judge’s refusal to grant the Beers’ request for an adjournment on the first day of trial.

C. The refusal to grant further adjournment requests

The issue stated

[30] On subsequent trial days further adjournment requests by the Beers ensued, this time based on their medical conditions.

[31] When the trial resumed on March 3, 2020, the Beers attended; their Adjournment Counsel did not. Although opposing counsel had provided them with the documents ordered by the trial judge, the Beers did not bring them to the trial. Mrs. Beer informed the court that she had a four-hour medical appointment scheduled for the following morning at a hospital. When the trial judge sought further details about the matter, Mrs. Beer advised that she was getting a “panic attack”. As the discussion continued, Mrs. Beer initially advised that she would call the hospital and cancel the appointment, then stated she would keep the appointment, miss the second day of trial, leaving matters to her co-defendant husband.

[32] The trial judge next asked plaintiffs’ counsel to begin his opening submissions. Thereupon Mrs. Beer began to make noises, which prevented the trial judge from hearing the submissions. Mrs. Beer left the courtroom with her husband and requested an ambulance. One came, and Mrs. Beer and her husband went with the paramedics. A brief recess was taken. On the resumption of court, counsel for the Re/Max Third Parties informed the trial judge that she understood from the Beers’ former lawyer “this exact thing” had happened at a judgment debtor examination conducted by the former counsel. The trial judge asked counsel to contact the Beers to advise that the trial would resume the following day at 10:00 a.m.

[33] Upon the resumption of the trial on the third day, March 4, 2020, the Beers were not present. Counsel for the Re/Max Third Parties had received a text from Mr. Beer stating that he was not feeling well, was stressed out, and could not attend. The court and counsel had received some notes from the Beers about the previous day’s trip to a hospital emergency ward where both had been examined and discharged. The diagnosis for Mrs. Beer was anxiety; for her husband, a psychosocial problem. After hearing submissions from counsel, the trial judge took a brief recess. Upon resuming, the trial judge gave oral reasons in which she reviewed the events and the medical information. She directed that the trial proceed, concluding that the Beers were attempting to delay the trial further. The Dhatts’ counsel completed his opening submission.

[34] Following a recess, the trial judge re-considered her decision. She did not proceed to hear the Dhatts’ first witness. Instead, she arranged for her ruling to be sent to the Beers, together with a direction that they attend at court the following morning when the trial would proceed, with or without them.

[35] The trial resumed on the fourth day, March 5, 2020. Mrs. Beer attended; Mr. Beer did not. Mrs. Beer informed the court of four things. First, she had received the trial judge’s endorsement of the previous day but did not read it. Second, her husband was not well. Third, she took the position that her husband’s name was “not on the house” and she did not trust him to make any decision. In fact, the Beers owned the house as co-tenants. Finally, she presented a doctor’s note that stated Mrs. Beer was “experiencing worsening anxiety related to recent legal proceedings” and was “not in the state of mind to proceed with further legal proceedings right now, until she is deemed better prepared.”

[36] After considering the materials, the trial judge delivered oral reasons directing that the trial proceed. While acknowledging that Mrs. Beer was experiencing anxiety due to the legal proceeding, she observed that was “very common for many participants.” She repeated that the Beers had attempted on many occasions to delay the proceedings, and then stated:

The trial will proceed. There is no justification or explanation for the defendants not to be present. Mr. Beer cannot be told by his wife not to be present at trial for the reason she has given. There is no justification and no evidence to support his not being present. As a result, I order that this trial proceed. Mrs. Beer is here now, if she wishes to stay. If not, and she's already told her husband apparently not to be present, so that he is not here either. But we will proceed with the trial today.

[37] Mrs. Beer thereupon repeated her request for time to get a lawyer. The trial judge refused. Mrs. Beer left the courtroom, and the trial proceeded in the absence of the Beers.

Analysis

[38] On appeal, the Beers submit that their medical circumstances on the second, third, and fourth days of the trial were extenuating and exceptional, and the trial judge erred by failing to grant them an adjournment.

[39] I am not persuaded by that submission. As revealed by the events of those days as described above, the trial judge proceeded in a measured way, affording the Beers fair opportunities over the course of three days to explain their situation. The trial judge’s endorsements disclose that she reviewed all the medical documentation provided by the Beers and took that information into account when assessing the interests of all parties to the proceeding. I see no basis for appellate intervention in the circumstances.

III. SECOND GROUND OF APPEAL: THE GRANT OF SPECIFIC PERFORMANCE

[40] The Beers submit that the trial judge erred in granting “the extraordinary remedy of specific performance”. They contend that the characteristics of the property did not make it unique and the Dhatts’ losses could be quantified and remedied by an award of damages.

[41] I do not accept that submission.

[42] To describe the remedy of specific performance as an “extraordinary remedy” is a misdescription. In determining whether to grant specific performance, the fundamental question is whether the plaintiff has shown that the land rather than its monetary equivalent better serves justice between the parties: Lucas v. 1858793 Ontario Inc. (Howard Park), 2021 ONCA 52, at para. 70, quoting, with approval, Lax J. in John E. Dodge Holdings Ltd. v. 805062 Ontario Ltd. (2001), 56 O.R. (3d) 341 (S.C.), at para. 55, aff’d (2003), 63 O.R. (3d) 304 (C.A.), leave to appeal refused, [2003] S.C.C.A. No. 145. As stated by this court in Lucas at para. 71:

Whether specific performance is to be awarded or not is therefore a question that is rooted firmly in the facts of an individual case … In determining whether a plaintiff has shown that the land rather than its monetary equivalent better serves justice between the parties, courts typically examine and weigh together three factors: (i) the nature of the property involved; (ii) the related question of the inadequacy of damages as a remedy; and (iii) the behaviour of the parties, having regard to the equitable nature of the remedy … Whether a property is unique, either by virtue of its nature or the features of the contract for its purchase and sale, operates as only one of several factors a court must consider when determining entitlement to specific performance. [Citations omitted.]

[43] The trial judge identified and applied the governing principles. Her conclusion, at paras. 39 and 40, that the Dhatts had demonstrated that the property possessed unique qualities was fully supported by the evidence. As was her finding that damages would not be an adequate remedy in the circumstances given the evidence that the Beers lacked sufficient funds to pay a damages award: at paras. 43-46.

[44] Accordingly, I see no basis to interfere with the trial judge’s grant of specific performance.

IV. THIRD GROUND OF APPEAL: THE AWARD OF SUBSTANTIAL INDEMNITY COSTS

[45] As their final ground of appeal, the Beers submit that the trial judge erred in awarding substantial indemnity costs to the Dhatts ($112,347.63) and the Re/Max Third Parties ($88,178.52). The Beers submit that the trial judge did not provide any reasons, with the result that the costs should be reduced to the partial indemnity level.

[46] I do not accept this submission. The trial judge explained, at paras. 54-56, why she awarded costs on a substantial indemnity basis: (i) the Beers attempted to delay or prolong the proceeding, to the point of failing to attend the trial despite being ordered to do so; and (ii) the Beers’ failure to close the transaction and failure to appear at trial were “without justification” and “egregious”.

[47] The trial judge relied mainly on the litigation misconduct of the Beers in awarding costs on the elevated scale of substantial indemnity. I see no error in principle by the trial judge nor were the resulting cost awards unreasonable in the circumstances.

V. DISPOSITION

[48] For the reasons set out above, I would dismiss the appeal.

[49] If the parties are unable to agree on the costs of the appeal, they may submit brief cost submissions (not to exceed three pages) within 10 days of the release of these reasons.

Released: March 4, 2021 “G.R.S.” “David Brown J.A.” “I agree. G.R. Strathy C.J.O.” “I agree. B.W. Miller J.A.”

[1] A helpful summary of the specific factors a trial judge should take into account when faced with an adjournment request can be found in Trade Capital Finance Corp. v. Cook, 2016 ONSC 3511, at paras. 8-11.