Maple Leaf Acres Members’ Association v. Ellig, 2023 ONSC 3940

CITATION: Maple Leaf Acres Members’ Association v. Ellig, 2023 ONSC 3940

DIVISIONAL COURT FILE NO.: 154/22

DATE: 20230714

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

Stewart, Lococo and Williams JJ.

BETWEEN:

MAPLE LEAF ACRES MEMBERS’ ASSOCIATION

Appellant (Respondent)

– and –

GREGORY ELLIG

Respondent (Applicant)

Geoff R. Hall and Eric Freeman, for the Appellant (Respondent)

Gregory Ellig, Respondent (Applicant), acting in person[^1]

Katia Snukai, for the Landlord and Tenant Board

HEARD at Toronto: June 9, 2023, by video conference

REASONS FOR JUDGMENT

R. A. LOCOCO J.:

I. Introduction

[1] The appellant Maple Leaf Acres Members’ Association (the “Association”) is a not-for-profit corporation without share capital that owns a mobile home park. The respondent Gregory Ellig is a member of the Association, who leases a mobile home site from the Association.

[2] The Association appeals from an order of the Landlord and Tenant Board (the “Board”) dated August 16, 2022, declaring that the Residential Tenancies Act, 2006, S.O. 2006, c. 17 (“RTA”) applies to Mr. Ellig’s relationship with the Association. The Association also appeals from the Board’s review order dated September 27, 2022, denying the Association’s request to review the initial order.

[3] In the initial order, the Board found that Mr. Ellig is a “tenant” (as defined in the RTA) who does not fall within the statutory exclusion that applies to a person who has the right to occupy a rental unit by virtue of being a “shareholder” of a corporation that owns the residential complex in which the rental unit is situated. The Association submits that the Board erred in finding that Mr. Ellig, as a “member” of the Association (a non-share corporation), does not fall within the definition of “shareholder” of the corporation. The Association asks that the Board’s orders be set aside and an order issue that the RTA does not apply to Mr. Ellig’s relationship with the Association. In the alternative, the Association asks that the matter be remitted to the Board for a determination consistent with the court’s opinion.

[4] For the reasons below, I would dismiss the appeal.

II. Factual background

[5] The Association is a not-for-profit corporation without share capital. It was incorporated in 1982 under Ontario’s Corporations Act, R.S.O. 1990, c. C.38, and continued under the Not-for-Profit Corporations Act, 2010, S.O. 2010, c. 15 (the “NPCA”) when that legislation came into force on October 19, 2021. As a non-share corporation, the Association has “members” rather than shareholders. The Association has a board of directors elected by its members. Those directors must be members of the Association.

[6] The Association’s original name was the Maple Leaf Acres Tenants’ Association. In 2017, with the approval of its members, the Association’s name was changed to the Maple Leaf Acres Members’ Association. The Association also revised and updated its leases, rules and regulations, (in part, in anticipation of the coming into force of the NPCA) “to better reflect the non-share capital membership-based non-profit nature of the Association.”[^2]

[7] The Association is the owner of a mobile home park in Fergus, Ontario. Mr. Ellig resides in a mobile home (that he owns) located on a mobile home site leased from the Association. The lease was assigned to Mr. Ellig on May 25, 2016. It has a term of 21 years less a day, which commenced on May 1, 2003 and terminates on April 30, 2024. At the time of the Board hearing, Mr. Ellig was required to pay the Association a fee of $338 per month for the exclusive right to occupy the mobile home site as well as access to and use of the common areas and other services and facilities that the Association provides from time to time to leaseholders. The lease assigned to Mr. Ellig provided (in error) that one share in the Association would be issued to the leaseholder.[^3]

[8] As a leaseholder, Mr. Ellig is a member of the Association, with rights and obligations set out in the NPCA, the Association’s articles, by-laws, rules and regulations, and the mobile home site lease. At the time of the Board hearing, the Association had 520 members. Only persons who hold a lease may be members of the Association and only members may hold a lease. If a person no longer has a valid lease, the person will automatically cease being a member of the Association.[^4] As well, a breach of any terms of the lease or of the Association’s rules and regulations could result in the termination of the member’s lease.

[9] As the parties agreed at the Board hearing, Mr. Ellig’s rights as a member of the Association include the following:

a. The right to sit on the Association’s board of directors, if elected;

b. The right to vote on the Association’s annual budget, the result of which determines the annual fees paid by the residents as provided in their lease agreements;

c. The right to vote on the Association’s leases, bylaws and regulations; and

d. If the Association is wound up and dissolved by special resolution, the right to share rateably in the proceeds once any liabilities are satisfied.

III. Application to the Board

[10] On March 16, 2022, Mr. Ellig made an “Application about Whether the Act Applies” (Form A1) to the Board pursuant to s. 9 of the RTA. He sought a declaration that he was a “tenant” and that the RTA applied to his relationship with the Association.

[11] Except as otherwise provided in the RTA, that legislation applies to all “rental units” in “residential complexes” despite any term in a tenancy agreement that suggests otherwise: RTA, s. 3(1). Subject to certain statutory exceptions, the following terms are defined in s. 2(1):

a. A “residential complex” includes a mobile home park;

b. A “rental unit” means any living accommodation (including a site for a mobile home) used or intended for use as residential premises;

c. A “landlord” includes the owner of a rental unit or any other person who permits occupancy of a rental unit;

d. A “tenant” includes a person who pays rent in return for the right to occupy a rental unit; and

e. “Rent” includes the amount of any consideration paid by a tenant to a landlord for the right to occupy a rental unit and for certain ancillary services, facilities and privileges.

[12] In his application to the Board, Mr. Ellig argued that the monthly amount he paid to the Association constituted “rent”. Therefore, he was a “tenant’ within the meaning of the RTA, establishing a landlord and tenant relationship between the parties. He disputed that any statutory exception applied, with the result that the RTA applied to his relationship with the Association.

[13] The Association disputed that analysis. The Association argued that the RTA did not apply, since Mr. Ellig was excluded from the definition of “tenant” in s. 2(1), which provides as follows:

“tenant” includes a person who pays rent in return for the right to occupy a rental unit … but “tenant” does not include a person who has the right to occupy a rental unit by virtue of being,

(a) a co-owner of the residential complex in which the rental unit is located, or

(b) a shareholder of a corporation that owns the residential complex;

[Emphasis added.]

[14] At the Board hearing, the Association argued that the mobile home site lease did not have the hallmarks of a typical landlord and tenant relationship since Mr. Ellig had the right as a member of the Association to (i) vote on the monthly fees paid and the Association’s rules and regulations, (ii) sit on the Association’s board of directors if elected, and (iii) benefit from the future value of the Association if dissolved. As a result, a member of a non-share corporation was akin to a shareholder of a corporation with share capital, with the result that a member was excluded from the definition of tenant in the RTA.

[15] In its decision, the Board accepted Mr. Ellig’s submission that he was a “tenant” who paid “rent” to the Association to occupy a “rental unit” (the mobile home site) in a “residential complex” (the mobile home park), which established a landlord and tenant relationship between the parties: Board decision, at paras. 21-22. The Board rejected the Association’s submission that the parties’ relationship fell within an exclusion from the RTA’s application, stating that it was not persuaded that membership in the Association was tantamount to being a shareholder: at paras. 15-16.

[16] In reaching its decision, the Board noted the requirement in s. 202 of the RTA, which directs the Board, in making its findings on an application, to “ascertain the real substance of all transactions and activities relating to a residential complex or a rental unit and the good faith of the participants”: at paras. 17-19. The Board found that at the time that the lease was assigned to Mr. Ellig, he “knew he was not entering into a typical landlord and tenant relationship”, given the rights accruing to him as a member of the Association and that neither party “expected a tenancy covered by the [RTA]”: at paras. 18, 20. However, the Board concluded that regardless of the parties’ intentions or any agreement to operate outside the RTA (which would be proscribed by s. 3(1)), the real substance of their agreement was that Mr. Ellig was “a Tenant paying rent to a Landlord for the right to occupy a residential unit inside a residential complex”: at paras. 21-22. The Board found Mr. Ellig’s rights as a member were not sufficient to “draw the inference that [Mr. Ellig] holds an ownership interest in the corporation”: at para. 22.

[17] In the Board decision, at para. 23, the Board said that it was adopting the reasoning in EAT-55915-16-IN and EAL-56910-16 (Re), 2016 61389 (Ont. L.T.B), a previous Board decision that Mr. Ellig cited. In that decision, the adjudicator found that the RTA applied to the relationship between a mobile home park resident and the not-for-profit corporation that owned the mobile home park. The basis for that decision was the finding that the resident was not a member in good standing of the corporation because the resident’s monthly payments for occupation of the mobile home site were in arrears: EAT-55915-16-IN, at para. 42. The adjudicator went on to find that even if the resident were a member in good standing, the RTA would still apply. Citing s. 202, the adjudicator found that the “real substance” of the relationship was that of landlord and tenant, taking into account “the ‘pattern of activities’ relating to the rental unit”: EAT-55915-16-IN, at paras. 44, 46. In the decision under appeal, the Board indicated that it “found that reasoning persuasive”: Board decision, at para. 23.

[18] In reaching its decision, the Board distinguished or declined to follow two previous Board decisions that the Association relied on: Re SWT-OO135, 2007 CarswellOnt 9627 (referred to further below) and Topolinsky v. Maple Leaf Acres Tenants’ Association (July 22, 2015), Hamilton, SOT-59066-15 (Ont. L.T.B.), an unreported decision where the parties to the application were the Association and another resident of the Association’s mobile home park: Board decision, at paras. 15, 19.

[19] After receiving the decision under appeal, the Association made a request to the Board to review the order on the ground of serious error. After a preliminary review of the request, the Board denied the review without a hearing and confirmed the initial order, finding no serious error in the order or the proceedings. Among other things, the Board rejected the Association’s submission that the Board erred in failing to follow the previous Board decisions it referred to in the Board decision, stating that the Board was not bound by previous Board decisions.

IV. Jurisdiction and standard of review

[20] The Association appeals the Board’s initial order and the review order arising from Mr. Ellig’s application. A person affected by an order of the Board has a statutory right of appeal to the Divisional Court, but only on a question of law: RTA, s. 210(1). Absent an extricable error of law, the Board’s findings of fact or findings of mixed fact and law (which includes the application of correct legal principles to the evidence) cannot be appealed.

[21] The standard of review is correctness for questions of law, including legal principles extricable from questions of mixed fact and law: Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235, at paras. 8, 34-37.

[22] While the court is empowered to replace the Board’s opinion with its own, the correctness standard does not detract from the need to respect a tribunal’s specialized function. The Board’s subject matter experience and expertise relating to the requirements of the RTA should be taken into account: Reisher v. Westdale Properties, 2023 ONSC 1817 (Div. Ct.), at paras. 9-10, citing Planet Energy (Ontario) Corp. v. Ontario Energy Board, 2020 ONSC 598 (Div. Ct.), at para. 31.

[23] An error of law must be material to the result to warrant the court’s intervention. Errors that are inconsequential or do not result in a substantial wrong or miscarriage of justice are insufficient to justify appellant intervention: Courts of Justice Act, R.S.O. 1990, c. C.43, s. 134(6).

V. Interpretation of “shareholder”

[24] In this appeal, the Association raises the issue of whether the Board erred in law in its interpretation of the term “shareholder” in the definition of “tenant” in s. 2(1) of the RTA. Determination of that issue is a question of statutory interpretation.

A. Principles of statutory interpretation

[25] In Rizzo & Rizzo Shoes Ltd. (Re), 1998 837 (SCC), [1998] 1 S.C.R. 27, at para. 21, the Supreme Court concisely set out the modern principle of statutory interpretation (as previously formulated in Elmer A. Driedger, Construction of Statutes, 2nd ed. (Toronto: Butterworths, 1983), at p. 87.), as follows:

Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament.

[26] In Blue Star Trailer Rentals Inc. v. 407 ETR Concession Company Limited, 2008 ONCA 561, 91 O.R. (3d) 321, at paras. 23-25, after stating that principle, the Court of Appeal went on to state as follows:

This approach to statutory interpretation -- sometimes referred to as the textual, contextual or purposive approach -- requires an examination of three factors: the language of the provision, the context in which the language is used and the purpose of the legislation or statutory scheme in which the language is found.

When applying this approach, it makes sense to start by examining the ordinary meaning or meanings of the words being interpreted. The ordinary meaning is "the natural meaning which appears when the provision is simply read through"….

After considering the ordinary meaning of the language involved, the court should consider the context in which the language is found as well as the purpose of the legislation or the statutory scheme. If this analytical approach yields a plausible interpretation then the court need go no further and should adopt that interpretation. It is only when there remains genuine ambiguity between reasonable interpretations that the court should resort to other principles of statutory interpretation [Citations omitted.]

[27] In Rizzo, at para. 27, the Supreme Court provided further guidance as follows:

It is a well established principle of statutory interpretation that the legislature does not intend to produce absurd consequences…. [A]n interpretation can be considered absurd if it leads to ridiculous or frivolous consequences, if it is extremely unreasonable or inequitable, if it is illogical or incoherent, or if it is incompatible with other provisions or with the object of the legislative enactment [Citations omitted.]

B. Association’s submissions

[28] The Association says that the Board erred in law in its interpretation of the term “shareholder” in the definition of “tenant” in s. 2(1) of the RTA. As set out in that provision, a tenant does not include a person who has the right to occupy a rental unit by reason of being,

a. a co-owner of the residential complex in which the rental unit is located, or

b. a shareholder of a corporation that owns the residential complex.

[29] The Association argues that the exclusory language in the definition of tenant indicates a legislative purpose to exclude from the definition co-owners of a residential complex and shareholders in a corporation that own a residential complex. The Association says that the Board erred in its interpretation of the term “shareholder” by adopting a supposed “plain reading” interpretation of the term, which excluded members in not-for-profit corporations without share capital. This narrow, literal, non-contextual interpretation was an error of law inconsistent with the modern principle of statutory interpretation. When interpreted purposively and in its entire context, the term “shareholder” in s. 2(1) includes members in a not-for-profit corporation without share capital, according to the Association.

[30] Having noted that the literal words in the definition of tenant exclude “shareholders” of a corporation (without specific reference to “members”), the Association then turns to consideration of the RTA’s legislative purpose and the context in which the language is found.

[31] With respect to the former, the purposes of the RTA are set out in s. 1, as follows:

Purposes of Act

1. The purposes of this Act are to provide protection for residential tenants from unlawful rent increases and unlawful evictions, to establish a framework for the regulation of residential rents, to balance the rights and responsibilities of residential landlords and tenants and to provide for the adjudication of disputes and for other processes to informally resolve disputes.

[32] As explained in Matthews v. Algoma Timberlakes Corporation, 2010 ONCA 468, 102 O.R. (3d) 590, at para. 23, leave to appeal refused [2010] S.C.C.A. No. 369, “the purpose behind extending the application of these protections to mobile homes (and later to land lease sites) was to provide tenants of those premises with security of tenure and other protections that had been available to other tenants”: see RTA, s. 152, which provides that Part X of the RTA applies to tenancies in mobile home parks and land lease communities.

[33] The Association argues that when a person who occupies a land lease site is a member of a not-for-profit corporation without share capital, the overarching concerns about extending the protections of the RTA are overwhelmingly obviated. Like shareholders in a corporation with share capital, members in a not-for-profit corporation without share capital have a number of rights by virtue of their membership that empower them to exercise significant control over the management and operation of the corporation. Those rights include the right to vote at meetings of the members, where they may elect and remove directors as well as consider and approve the Association’s annual budget, which determines the annual fees paid under the members’ lease agreements. While the members do not share in the profits of the Association (being a not-for-profit corporation), the members would share rateably in the Association’s capital (after satisfaction of debts and liabilities) upon the Association being wound up and dissolved by special resolution approved by its members.

[34] The Association submits that the rights of a member of a non-share corporation, taken as a whole, are analogous to the rights of a shareholder of a corporation with share capital. Like shareholders, the members’ rights ensure that they are protected against arbitrary rent increases and evictions, since the fees payable by members must be approved by the membership. Therefore, the purpose of extending the protections of the RTA to members of a not-for-profit corporation without share capital are notably absent. In light of these considerations, the Association submits that members of a non-for-profit corporation without share capital are “akin” to shareholders of a corporation with share capital. Therefore, the term “shareholder” in the definition of “tenant” in s. 2(1) of the RTA should be interpreted to include members in a not-for-profit corporation without share capital. They should not be considered to be tenants for the purposes of the RTA.

[35] With respect to context for use of the term “shareholder” in the definition of “tenant”, the Association cites an instance in which that the terms “shareholder” and “member” are used interchangeably in another Ontario statute, the Corporations Act. As set out in s. 133(1), certain sections of that statute relating to corporations with share capital incorporated under that statute also apply with necessary modifications to corporations without share capital incorporated under that statute and in so applying, the word “shareholder” means “member” for that purpose. As previously noted, the Association was originally incorporated under and governed by the Corporations Act, until the Association continued under the NPCA upon the coming into effect of that statute on October 19, 2021.

[36] As part of its contextual analysis to support the argument that “shareholder” should be interpreted as including a member of a not-for-profit corporation, the Association also referred to the following legal publications relating to not-for-profit and charitable organizations that address the rights and obligations of members: R. Jane Burke-Robertson, Terrance Carter and Theresa Man, Corporate and Practice Manual for Charities and Not-For-Profit Corporations, loose-leaf (Toronto: Thomson Reuters, 2013) and Keith Seel, The Management of Non-profit and Charitable Organizations in Canada, 4th ed. (Toronto: LexisNexis Canada Inc., 2018).

[37] In Seel, at p. 171, the authors state that a “corporation without share capital … is akin to the traditional corporate structure, except the members (who are similar to shareholders) do not benefit financially from the organization.” The reason for this distinction is explained in Burke-Robertson, at s. 1:3.30:

In a non-share capital corporation, the members are prohibited from receiving any pecuniary gain, since the underlying objective is to carry on activities for the common good and not for individual gain. Indeed, the very notion of members, as opposed to shareholders, implies co-operative or altruistic motive rather than a profit-making intention on the part of those involved.

[38] The Association argues that given this explanation, the above distinction between a “shareholder” and a “member” should not affect the conclusion that “shareholder”, as used in the definition of “tenant” in the RTA, should be interpreted as including a member of a non-share corporation. The Association submits that it would be absurd to conclude otherwise. A member is otherwise equivalent to a shareholder of a corporation with share capital, including with respect to the member’s right to share rateably in the corporation’s assets (net of liabilities) upon its dissolution.

[39] As it did before the Board, the Association also relies on previous Board decisions to support its position that a member of a non-share corporation should fall within the exclusion from the definition of tenant in the RTA.

[40] In Re SWT-OO135, the applicant resided in a trailer in a campground on a site leased from the campground’s owner, a not-for-profit corporation without share capital incorporated under the Corporations Act. The applicant was a member of the respondent corporation. The applicant sought an order that the corporation had substantially interfered with his reasonable enjoyment of the trailer site or campground. The Board found that there was no landlord and tenant relationship between the parties and dismissed the application for want of jurisdiction. In reaching that conclusion, the Board considered the applicant’s rights as a member of the corporation and, at para. 32, found as follows:

I find that the relationship of a member in a non-share capital corporation … is akin to that of a shareholder in a share capital corporation, with the major exception that in a share capital corporation, the shareholders benefit financially, or have a reasonable expectation of benefiting financially, from owning shares in the corporation.

[41] The Board in Re SWT-OO135 also found that “the main purpose and activity of the corporation and its Board of Directors, is to provide recreational facilities, not residential premises, to the members of the corporation”: at para. 34.[^5]

[42] The Association also relies on the Board’s 2015 unreported decision in Topolinsky v. Maple Leaf Acres Tenants’ Association, in which the parties to the application were the Association and different leaseholders. The Board decided that the RTA “does not apply to this living arrangement because the relationship between the parties is not one of landlord/tenant”: Topolinsky, paragraph under “Finding” on p. 2.[^6]

[43] Prior to stating that conclusion, the Board in Topolinsky set out certain introductory findings relating to the applicants’ rights (at pp. 1-2 under “Introduction”), in which the Board at various times used the terms “shareholders”, “members” and “leaseholders” to describe the applicants, including as follows (emphasis added):

a. The applicants “by virtue of their lease are also shareholders of the Non-share Corporation who is named as the Respondent in this application”: at para. 3.

b. The applicants “as shareholders of the corporation have rights associated with being a shareholder including the right to vote at annual meetings and a right to a certain percentage of the corporation if it is dissolved”: at para. 5.

c. “Residents pay an annual maintenance fee…[that] is intended to recover the costs of operating the park. Any capital improvements are paid for by the members by way of Special Levy approved by the shareholders”: at para. 8.

d. “The amount of the annual maintenance fee required to be paid by each lease holder is set by the corporation after it is approved by the shareholders (ie leaseholders) at an Annual Meeting”: at para. 9.

[44] At pp. 3-4 under “Reasons”, the Board made additional findings relating to the applicants’ rights, including the following (emphasis added):

a. “All leaseholders in this complex have the right, as shareholders, to serve on the Board of the corporation if elected by the other shareholders. The Board has the responsibility of preparing the budget that determines the annual fee”: at para. 1.

b. “Essentially the leaseholders, using their rights as shareholders, determine the annual fee and pay it to themselves to maintain their living spaces and pay for common utilities”: at para. 2.

c. The “members of the corporation actively engage in determining issues of process at the meetings as well as determining the rules and policies that will apply to their collective endeavour of living together responsibly in this community”: at para. 9.

[45] At paras. 9-10 under “Authorities” on p. 10, the Board in Topolinsky concluded as follows (emphasis added):

The Applicants by virtue of their leases become shareholders in the corporation that owns the residential complex. The lease requires them to pay a fee to the corporation but payment of that fee does not make them a tenant. Section 2 of the Act states: “tenant does not include a person who has the right to occupy a rental unit by virtues of being (b) a shareholder of a corporation that owns the residential complex”.

For these reasons the Board determines that the Act does not apply to the parties named in this application.

[Italics in the original, underlining added.]

[46] Given the foregoing, the Association submits that the Board in Topolinsky correctly concluded that the leaseholders were not tenants as defined in s. 2(1) and that the RTA did not apply as a result. The Association says that in the matter currently under appeal, the Board erred by disregarding the decisions in Topolinsky and Re SWT-OO135 and instead relying on the decision in EAT-55915-16-IN. The basis for the latter decision was the fact that the mobile home park resident was not a member in good standing of the not-for-profit corporation that owned the mobile home park. In obiter, the Board also stated its conclusion that the RTA would still apply even if the resident were a member. The Association submits that in making that obiter statement, the Board did not explain why a member is sufficiently distinct from a shareholder such that the member would not come within the exclusion from the definition of tenant in s. 2(1). Therefore, the Board in that case (like the Board in the matter under appeal) failed to engage in a purposive interpretation of the term “shareholder” as it is used in that definition, according to the Association.

C. Other submissions

[47] While the Association’s counsel (in their factum and oral submissions) eloquently outlined their submissions in favour of overturning the Board’s decision, there was nobody at the appeal hearing who made the case for upholding the decision. In these circumstances, an appeal court’s task becomes more challenging.

[48] At the conclusion of the oral submissions of the Association’s counsel, Mr. Ellig (who was self-represented and did not provide responding material) indicated that he had no submissions to make with respect to this appeal.

[49] Counsel for the Board prepared a factum that provided statutory and procedural context for the appeal. She made brief oral submissions but took no position on the correctness of the Board’s decisions.

D. Analysis and conclusion

[50] As explained below, I have concluded that the Board did not err in law in interpreting the term “shareholder” in clause (b) of the definition of “tenant” in s. 2(1) of the RTA as not including a member of a not-for-profit corporation without share capital.

[51] In the Board’s decision, at paras. 21-22, the Board found that Mr. Ellig pays “rent” to the Association, consisting of the fee he is required to pay for the right to occupy a mobile home site (being a “rental unit”) in the Association’s mobile home park (being a “residential complex”). On that basis, Mr. Ellig would be in a landlord and tenant relationship with the Association unless he falls within an exclusion from the “tenant” definition because he is a “shareholder” by reason of being a “member” of the Association. With the latter qualification, I understand that the Association does not challenge that conclusion, which in any case would be a question of mixed fact and law that is not reviewable by this court.

[52] The error that the Association alleges relates to the interpretation of the term “shareholder” in the exclusionary language of the “tenant” definition. There is no dispute that this issue raises a question of law reviewable on a correctness standard. The Association has the burden of establishing that the required standard has not been met.

[53] In applying the textual/contextual/purposive approach to statutory interpretation set out in Rizzo and Blue Star Trailer, the starting point is to consider the ordinary or plain language of the legislation: Blue Star Trailer, at para. 24. Consideration should also be given to the context of the legislative language and the purpose of the legislation: Blue Star Trailer, at para. 25.

[54] Although the Board’s analysis in the decision under review was rudimentary in nature, the approach that it took to the interpretation of “shareholder” was consistent with those principles. I see no legal error in the Board’s conclusions that would justify appellate intervention.

[55] While the Board did not refer specifically to the purposes of the RTA as set in s. 1, the Board as an administrative decision maker would be familiar with the legislation it was charged with administering and the interests of the parties that the legislation were intended to protect. As stated in s. 1, the legislation’s purposes included “to provide protection for residential tenants from unlawful rent increases and unlawful evictions” and “to balance the rights and responsibilities of residential landlords and tenants”. As noted in Matthews, at para. 23, the purpose of extending the protections in the RTA to mobile home site leases was to provide the lessees “with security of tenure and other protections” available to them under the RTA. Those protections would be of particular significance to a leaseholder (like Mr. Ellig) whose lease expires in less than a year and whose rights as a member depend on his continued status as a leaseholder.

[56] In the Board decision, at paras. 10-11, after setting out the definition of “tenant” in s. 2(1), the Board referred to Mr. Ellig’s rights as a member that (according to the Association) did not “have the hallmarks of a typical landlord and tenant relationship”. At para. 12, the Board acknowledged the Association’s position that “a member of non profit corporation without share capital is akin to a shareholder and therefore not a tenant under the Act”. Elsewhere in the decision, the Board also referred to members’ rights that the Association argued were analogous to those of shareholders: at paras. 3, 15, 16, 18, 20, 22.

[57] In its decision, at para. 15, the Board recognized that the literal words of the exclusionary language in the definition of “tenant” apply to a “shareholder”, which does not specifically refer to a “member”. Having considered the Association’s submissions (including those relating to nature of members’ rights), the adjudicator concluded that “I do not find the terms ‘member’ and ‘shareholder’ to be interchangeable.” The adjudicator stated his preference for a “plain reading” of that provision, stating that “I am not persuaded by the argument that [Mr. Ellig’s] membership in the corporation is tantamount to being a shareholder.” At para. 16, the Board went on to state that “[w]hile a member and a shareholder have similarities, that alone does not make them the same.”

[58] At para. 16, the Board also found that in determining the scope of the exclusory language in clauses (a) and (b) of the tenant definition, “the legislature’s purpose was to exclude persons that fall within the realm of owners from being tenants.” In my view, that is a “plausible interpretation” (to use the words of Blue Star Trailer, at para. 25) that meets the correctness standard of review. Clause (a) of the tenant definition excludes a co-owner of the residential complex; clause (b) excludes a shareholder of a corporation that owns the residential complex, which may be characterized (through its shareholding) as an indirect owner of the residential complex (emphasis added). The Board found that Mr. Ellig’s rights as a member would not bring him “within the realm” of an owner, as explained below:

In this case, the Tenant owns nothing apart from his mobile home. He has no tangible asset he can liquidate if he chooses to. He has a vote amongst 520 others on how things operate and the amount he pays. The possibility that one day he could receive an equal portion of the corporation’s value, after liabilities, were it to dissolve or be wound up is not in my view an asset of consideration. There is no guarantee any value would ever come of it.

[59] As further justification for its findings, the Board also stated that “had the legislature intended ‘members’ of a corporation be excluded from the definition of tenant, they could have quite easily said so in the legislation”: at para. 15. As set out in the Board’s factum provided for the appeal, the legislature provided exemptions from the RTA for other types of living accommodations, including the following:

a. “housing cooperatives incorporated under the Co-operative Corporations Act, R.S.O. 1990, c C.35”: RTA, ss. 94.1(2) and 5(c); and

b. “living accommodation that is subject to the Public Hospitals Act, the Private Hospitals Act, the Fixing Long-Term Care Act, 2021, the Ministry of Correctional Services Act or the Child, Youth and Family Services Act, 2017”: RTA, s. 5(e).

[60] The RTA does not include a similar exemption for a living accommodation that is occupied by a member of a not-for-profit corporation without share capital incorporated under the NPCA. Those specific exemptions from the RTA provide further support for the Board’s interpretation of the legislation in this case.

[61] I also see no legal error relating to the Board’s reliance on (or failure to rely on) the reasoning in previous Board decisions. As the Board observed in its review decision, the Board is not bound by previous Board decisions, although the Board was free to consider previous Board decisions in reaching its own decision. To the extent that it did so, it was open to the Board to adopt reasoning that may have been obiter or to decline to follow or distinguish previous Board decisions as being inapplicable in the circumstances.[^7]

[62] As previously noted, the Association argues that in interpreting the term “shareholder” in the definition of “tenant”, I should prefer the reasoning in the 2015 decision in Topolinsky, the parties to which were the Association and a different resident of the same mobile home park. In the decision under review, the Board stated that it “did not find the [Topolinsky] decision persuasive since at that time, lease holders at the property were shareholders whereas they currently are not”: Board decision, at para. 19.

[63] In my view, the Board had good reason to be skeptical about the reasoning in Topolinsky. As noted previously, the adjudicator in that case made various references to the applicants’ rights as “leaseholders”, “shareholders” and “members”. The adjudicator did not, however, expressly identify the issue of whether the term “shareholder” in the tenant definition included a “member” of a non-share corporation. Reading the Topolinsky decision as a whole, there is reason to question whether the adjudicator was influenced by the erroneous statement in the applicants’ leases that each leaseholder would be issued one share of the Association: see footnote 3, supra. Unlike the adjudicator in Topolinsky, the Board in the decision under review clearly understood that a “member” did not fall within the literal wording of the RTA, the starting point for the analysis under the textual/contextual/purposive approach to statutory interpretation.

[64] As well, I am not persuaded by the Association’s reliance (for context) on s. 133(1) of the Corporations Act, under which certain sections of that statute relating to share-capital corporations also apply with necessary modifications to non-share corporations and in so applying, the word “shareholder” means “member” for that purpose. The unequivocal language of the Corporations Act may also be taken as supporting the position that if the legislature had intended the term “shareholder” in the RTA to include “member”, the RTA would have so provided by clear and express language barring persons in Mr. Ellis’ position from its statutory protections.

[65] Another countervailing consideration is found in ss. 3(3) and 3(4) of the RTA, under which a provision of the RTA would prevail if it conflicts with a provision of another Act. Sections 3(3) and 3(4) provide as follows:

Conflicts, mobile home parks and land lease communities

(3) In interpreting a provision of this Act with regard to a mobile home park or a land lease community, if a provision in Part X [which applies to mobile home parks and land lease communities] conflicts with a provision in another Part of this Act, the provision in Part X applies.

Conflict with other Acts

(4) If a provision of this Act conflicts with a provision of another Act, other than the Human Rights Code, the provision of this Act applies.

VI. Disposition

[66] For the foregoing reasons, I would dismiss the appeal. Since the parties are not seeking costs, there will be no costs order.

___________________________ Lococo J.

I agree

___________________________ Stewart J.

I agree

___________________________ Williams J.

Date of Release: July 14, 2023

CITATION: Maple Leaf Acres Members’ Association v. Ellig, 2023 ONSC 3940

DIVISIONAL COURT FILE NO.: 154/22

DATE: 20230714

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

Stewart, Lococo and Williams JJ.

BETWEEN:

MAPLE LEAF ACRES MEMBERS’ ASSOCIATION

Appellant (Respondent)

– and –

gregory ellig

Respondents (Applicant)

REASONS FOR JUDGMENT

R. A. LOCOCO J.

Date of Release: July 14, 2023

[^1]: Gregory Ellig appeared at the virtual appeal hearing but made no oral or written submissions.

[^2]: See Executive Summary of Revisions to Leases and Rules & Regulations dated August 16, 2016, For Information Meeting on September 10, 2016 (“Executive Summary”), at p. 2 (included the Association’s appeal book).

[^3]: See Executive Summary, at p. 2, which stated that leases entered into prior to that time incorrectly provided that each leaseholder was to be issued one share of the Association. That statement was removed in the revised form of lease adopted in 2017 (to be used for subsequent leases, including lease renewals) since “[n]o share has ever been issued to anyone, nor can any shares be issued by the Association”, being a non-share corporation.

[^4]: See Executive Summary, at p. 2.

[^5]: In the decision under appeal, the Board stated that it did not find the decision in Re SWT-OO135 to be helpful, noting that “the agreement between the parties was not covered by the Act as the main purpose for it was to provide recreational activities”: Board decision, at para. 15.

[^6]: The Board’s five-page decision in Topolinsky was divided into sections under subheadings. The paragraphs were numbered section by section, rather than consecutively throughout the decision.

[^7]: See footnote 6, relating to the Board’s 2007 decision in Re SWT-OO135.