CITATION: Mir-Khaef v. Reid, 2020 ONSC 1417
DIVISIONAL COURT FILE NO.: 494/19
LANDLORD AND TENANT BOARD NO.: HOL-04328-19 DATE: 20200304
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
D.L. CORBETT, PENNY and M.L.J. EDWARDS JJ.
BETWEEN:
LAILY MIR-KHAEF
Timothy Gindi, for the Appellant (Landlord)
Appellant (Landlord)
– and –
KYLE REID and LORRIANE REID
Zaheed Moral and Obaidul Hoque, for the Respondents
Respondents (Tenant)
Brian A. Blumenthal for the Landlord and Tenant Board
HEARD at Toronto: March 4, 2020
PENNY J. (Orally)
Overview
[1] This is an appeal by the Landlord from a decision of the Landlord and Tenant Board which dismissed the Landlord’s application for an order that the Tenants pay compensation for damage to a leased condominium unit caused by a flood. The Landlord and Tenant Board found that the Tenants had not acted negligently in respect of the flood and that the Tenants’ failure to maintain insurance, as required in the lease, did not render them liable for the cost of repairing the damage.
[2] The application before the Board was brought under s. 89 (1) of the Residential Tenancies Act, 2006, S.O. 2006 c.17. Section 89(1) provides that a landlord may apply to the Board for an order requiring a tenant to pay reasonable costs that the landlord has incurred for the repair of damaged property if the tenant willfully or negligently causes undue damage to the rental unit or the residential complex.
[3] The Divisional Court has jurisdiction to hear this appeal under s. 210(1) of the Residential Tenancies Act, which provides that a party to an order issued by the Board may appeal to this Court on a question of law.
[4] Since the decision of the Supreme Court of Canada in Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, at para. 37, statutory appeals are subject to the appellate standard of review established in Housen v. Nikolaisen, 2002 SCC 33. The standard of review on a question of law is correctness. The standard of review on a question of fact is palpable and overriding error. A palpable error is one that is obvious, plain to see, or clear. An overriding error is an error that is sufficiently significant to vitiate the challenged finding of fact, such as the absence of any evidence to support the challenged finding. The standard of review on questions of mixed fact and law is palpable and overriding error unless the tribunal was wrong about an extricable issue of law.
background
[5] The Landlord owns a unit in a condominium building near Fort York in Toronto. The Tenants signed a lease to rent the unit in August 2016. The lease agreement required the Tenants to maintain fire and property and public liability insurance. The lease contained no requirement to name the Landlord as an insured. The Tenants had insurance when their tenancy first began but allowed their coverage to lapse prior to the incident giving rise to this case. The Landlord had no insurance.
[6] In May 2018, one of the Tenants informed the Landlord that there was a problem with the bathroom faucet. A plumber was called and repairs were made. In August, 2018, the faucet leaked again. The Tenants’ efforts to stop the leak caused the connection to fail, releasing water into the unit. The Tenants were unable to find the shut off valve to cut off the supply of water to the bathroom. He called building management, who attended and were eventually able to find and shut off the valve after 15 to 20 minutes. Several other units in the building suffered flood damage, with costs of repair exceeding $25,000.
[7] Before the Landlord and Tenant Board, the Landlord argued that the damage was caused by the Tenants’ negligence on the day of the flood and that, in any event, the Tenants had assumed liability for this damage as a consequence of their failure to maintain insurance, as required under the lease agreement.
[8] In a decision of July 30, 2019, the Board dismissed the Landlord’s application. The Board found that the Tenants were not negligent, noting, among other things, that while the Tenants had struggled to locate the shut off valve, the professional building staff also took close to 20 minutes to find the valve. In addition, the Board noted that the flood could have been avoided altogether had the Landlord adequately repaired the faucet after the problem was first reported in May 2018.
[9] With respect to the Tenants’ failure to maintain insurance, the Board noted that there is no statutory requirement for a tenant to obtain and maintain tenant’s insurance. In any event, to the extent that the Tenants may have been in breach of the lease by failing to have insurance, they could not be found to have caused “undue damage” to the Landlord by their failure to do so.
[10] Before the Divisional Court, the Landlord argues:
(1) the Board erred in finding that the Tenants were not liable for the damage despite their failure to obtain insurance;
(2) the Board erred in its interpretation of the concept of “undue damage”; and
(3) the Board erred by misstating and misapplying the principles of negligence.
Insurance
[11] The Landlord complains that the Board failed to give effect to the express terms of the lease requiring the Tenants to maintain fire and property insurance. The Landlord relies on a decision of the Court of Appeal for Ontario in Deslaurier Custom Cabinets Inc. v. 1728106 Ontario Inc., 2016 ONCA 246 at para. 86 for the proposition that a contractual undertaking to secure property insurance operates in effect as an assumption by that party of the risk of loss or damaged caused by the peril to be insured against.
[12] The problem with this argument is that the Landlord tendered no evidence capable of establishing that, if the Tenants had maintained insurance, that insurance would have covered the property damage associated with this incident. If the Landlord wanted to rely on this argument, it was incumbent upon her to prove that, had the insurance been in place, she would not have suffered any loss. This is particularly so in view of the Board’s finding that the Tenants were not negligent. There was simply no evidence about the availability of coverage required under the lease that would have indemnified the Landlord against this loss. Put another way, the Landlord failed to establish any causal relationship between the failure to obtain insurance and the alleged “undue damage” she suffered as a result of the flood.
Undue Damage
[13] We agree with the Tenants’ counsel that the issue of “undue damage” is not a freestanding ground of appeal. The Landlord’s claim was not dismissed by the Board on the basis that there was no undue damage. The Landlord’s claim was dismissed on the basis of the Board’s finding that the Tenants’ were not negligent. If there was no breach of the standard of care, there cannot have been negligent conduct which caused “undue damage.”
Negligence
[14] The Landlord argues that the Board, in paragraph 19 of its decision, did not properly define the test for negligence and cited a case involving gross negligence. While this is true, the Board’s analysis in paragraphs 21 through 27 (and, in particular, in paragraph 22) makes it clear that the Board correctly understood negligence to involve a departure from standards by which a reasonably competent person would behave. There was no error of law.
[15] The application of the law to the facts is a question of mixed fact and law. No appeal lies from an error of mixed fact and law under the Residential Tenancies Act (unless the alleged error involves an extricable legal question, which, in this case, it does not). There was, in addition, ample evidence to support the Board’s findings that the Tenants were not negligent, evidence which was cited in the Board’s decision. The Board made no palpable and overriding error of fact.
Conclusion
[16] For these reasons, the Landlord’s appeal is dismissed.
Costs
[17] The parties have agreed that costs to the successful party should be $4,000. Therefore, costs to the Tenants of $4,000 inclusive of fees, disbursements and all applicable taxes.
D.L. CORBETT J.
[18] I have endorsed the Appeal Book and Compendium as follows: “The appeal is dismissed for oral reasons of Penny J., with costs from the Landlord to the Tenant fixed at $4,000, inclusive.”
___________________________ Penny J.
I agree
___________________________
D.L. Corbett J.
I agree
___________________________
M.L.J. Edwards J.
Date of Oral Reasons for Judgment: March 4, 2020
Date of Release: June 17, 2020
CITATION: Mir-Khaef v. Reid, 2020 ONSC 1417
DIVISIONAL COURT FILE NO.: 494/19
LANDLORD AND TENANT BOARD NO.: HOL-04328-19 DATE: 20200304
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
D.L. CORBETT, PENNY and M.L.J. EDWARDS JJ.
BETWEEN:
LAILY MIR-KHAEF
Appellant (Landlord)
– and –
KYLE REID and LORRIANE REID
Respondents (Tenant)
ORAL REASONS FOR JUDGMENT
PENNY J.
Date of Oral Reasons for Judgment: March 4, 2020
Date of Release: June 17, 2020