CITATION: Sun v. Leung, 2024 ONSC 2913

DIVISIONAL COURT FILE NO.: 47/24

DATE: 20240523

SUPERIOR COURT OF JUSTICE – ONTARIO

DIVISIONAL COURT

RE: Chuk Man Annice Sun, Moving Party

AND:

Sum Yi Cindy Leung, Responding Party

BEFORE: H. Sachs J.

COUNSEL: Ran Tao, for the Moving Party

Alyssa Weinerman, for the Responding Party

HEARD at Toronto: In writing.

ENDORSEMENT

Overview

[1] Ms. Sun is Ms Leung’s mother. The two own a property together as tenants in common. Ms. Leung is registered as a 75 per cent owner and Ms. Sun as a 25 per cent owner. On December 14, 2023, Faieta J. ordered that the property be sold immediately, that Ms. Leung was to have the sole authority to list the property and the sole carriage of the sale, that Ms. Sun’s consent to the sale be dispensed with and that Ms. Sun was to ensure vacant possession of the property by February 28, 2024 (the “Order”). The Order also provided that Ms. Leung was to be responsible for most of the payments associated with the property pending sale, but that Ms. Sun was to pay her $4500.00 towards those expenses, commencing on January 1, 2024. The net proceeds realized from the sale after the payment of mortgages, lines of credit, real estate commission and other expenses associated with the sale were ordered to be held in trust, pending further agreement or court order.

[2] This is a motion by Ms. Sun seeking leave to extend the time for appealing the Order. If leave is granted, Ms. Sun is also seeking an order staying the Order.

[3] For the reasons that follow the motion to extend is denied. If I had granted leave to extend the time for appealing the Order, I would not grant a stay of the Order.

The test on a motion to extend

[4] The test on a motion to extend the time for filing a Notice of Appeal is well settled. The overarching principle is whether the “justice of the case” requires the extension of time. The onus is on the moving party to establish the grounds for the extension request and the Court is to take into account all relevant considerations, including:

(a) whether the moving party formed the intention to appeal within the relevant period.

(b) the length of the delay, and the explanation for the delay, in filing.

(c) any prejudice caused or exacerbated by the delay; and

(d) the merits of the proposed appeal. (Teitler v. Dale, 2021 ONCA 577 at para. 7).

Application of the Test to the facts of this case

The Intention to Appeal

[5] Ms. Sun was required to serve her Notice of Appeal within 30 days of the Order ie by January 15, 2024 (30 days from December 14, 2023 was Saturday January 13, 2024, and the first business day thereafter was Monday, January 15, 2024). The Notice of Appeal was not properly served until January 19, 2024.

[6] Ms. Leung does not dispute that Ms. Sun formed the intention to appeal within the relevant time period.

The Length of, and the Explanation for, the Delay

[7] The delay before the Notice of Appeal was served was only a few days. However, it has been more than two months since the Divisional Court advised Ms. Sun that she needed to bring a motion to extend the time for filing her Notice of Appeal. Further Ms. Sun filed an Affidavit of Service that on its face was misleading as to when the Notice of Appeal was filed.

[8] A notice seeking to appeal the Order was first served on Ms. Leung’s counsel on January 11, 2024. The appeal was filed in the wrong court, i.e., the Court of Appeal. An affidavit in relation to the service of this notice was sworn on January 16, 2024.

[9] On January 15, 2024, Ms. Leung’s counsel advised Ms. Sun’s counsel that she had filed her appeal in the wrong court. On January 16, 2024, Ms. Sun’s counsel served Ms. Leung’s counsel with a Notice of Abandonment in relation to the appeal to the Court of Appeal.

[10] On January 18, 2024, the Divisional Court sent both parties’ counsel an email containing a file number in relation to the appeal before the Divisional Court. Ms. Leung’s counsel emailed back indicating that she had never received a Notice of Appeal in relation to an appeal to the Divisional Court.

[11] On January 18, 2024, Ms. Sun’s counsel sent Ms. Leung’s counsel a Notice of Appeal to the Divisional Court dated January 17, 2024. On January 19, 2024, Ms. Sun’s counsel sent Ms. Leung’s counsel a Notice of Appeal that he stated that he filed with the Divisional Court on January 17, 2024. This included a Notice of Appeal dated January 11, 2024, that referenced both the Divisional Court and the Court of Appeal.

[12] On January 19, 2024, the Divisional Court sent Ms. Leung’s counsel the Affidavit of Service in relation to the material filed on January 17, 2024. The Affidavit of Service submitted related to the service of the documents that were served on January 11, 2024, for the appeal to the Court of Appeal that was subsequently abandoned. Ms. Leung was shocked by this behaviour as she saw it as an attempt to make it appear that the Notice of Appeal to the Divisional Court had been served on time. Her counsel advised the Divisional Court of the fact that the appeal to the Divisional Court had not been filed on time.

[13] On January 31, 2024, the Divisional Court notified Ms. Sun’s counsel that she would have to bring a motion to extend the time for the filing of her Notice of Appeal to the Divisional Court. At that point Ms. Sun’s counsel asked Ms. Leung’s counsel for her consent to late filing of the Notice of Appeal. Ms. Leung’s counsel refused to consent.

[14] Two months later, on April 3, 2024, Ms. Sun’s counsel served Ms. Leung’s counsel with this motion to extend. This was done after Ms. Leung had served a motion on March 25, 2024 to seek the court’s assistance to move the sale forward (as provided for in the Order).

[15] The explanation for the late filing of the motion to extend is that Ms. Sun’s counsel was away from the office for personal reasons from February 26 and March 15, 2024.

Prejudice

[16] Ms. Leung commenced proceedings to sell the property in December of 2021.

[17] On September 9, 2022, an order was made requiring Ms. Sun to provide a comprehensive accounting within 60 days. Ms. Sun did not do so.

[18] The parties were also ordered to attend for mediation and if the mediation was unsuccessful, Ms. Sun was to provide her responding record within 15 days. The mediation took place in January of 2023. Ms. Sun never delivered a responding record.

[19] On November 27, 2023, Kristjansen J. made an order requiring Ms. Sun to transfer to Ms. Leung $3000.00 per month, being 50% of the rent Ms. Sun was collecting from the rental of the property. Ms. Sun did not appeal this order and did not comply with it.

[20] In the same order Ms. Sun was told to provide Ms. Leung with a significant amount of disclosure by March 31, 2024. Ms. Sun has not complied with this aspect of the order.

[21] The Order required Ms. Sun to pay Ms. Leung $4500.00 per month, commencing on January 1, 2024. Ms. Sun is in breach of this aspect of the Order even though she is collecting the rental income from the property (amounting to $6150.00 per month) and Ms. Leung is paying almost 100 per cent of the costs associated with maintaining the property (including utilities, property taxes, insurance and all mortgage payments).

[22] Neither Ms. Sun nor Ms. Leung live in the property. Ms. Sun rented the property out (over Ms. Leung’s objections) and collects all the rent. Ms. Sun lives in another waterfront property that she owns and that is unencumbered.

[23] Because of Ms. Leung’s obligations in relation to the property she and her husband live in a rented basement apartment.

Merits of the Proposed Appeal

[24] As the motion judge set out, “[a] court is required to compel the partition of a property unless the opposing party has shown that there is malicious, vexatious, or oppressive conduct on the part of the moving party in relation to the sale itself: Marchese v. Marchese, 2019 ONCA 116 (C.A.), at para. 5.”

[25] Ms. Sun opposed Ms. Leung’s motion for sale on the basis of what she alleged was the defence of promissory estoppel. Specifically, she alleges that before construction on the property commenced Ms. Leung promised her that she would be able to rent out the basement of the property after its completion and that she could retain all of the rental income from that property. Further, she alleges that Ms. Leung agreed that she was holding 25 percent of the property in trust for Ms. Sun. It was because of these promises, Ms. Sun says that she agreed to make significant contributions to the construction costs. Ms. Leung denies that any of these promises were made.

[26] Ms. Sun alleges that the motion judge erred when he found that the Statute of Frauds would operate to bar her defence based on promissory estoppel and he denied her procedural fairness by failing to address her defence.

[27] The fact that there may have been an agreement that Ms. Sun could retain rental income from a basement apartment does not make the sale of the property “malicious, vexatious or oppressive.” First, there was no finding of malicious, vexatious or oppressive conduct in relation to the sale itself. Second, Ms. Sun’s motive for wanting the rental income was to have a source of income for her retirement. If the property is sold, the proceeds will be kept in trust and Ms. Sun will have the ability to pursue her claim for 50 percent of those proceeds. Once her interest is determined she will have access to her share of the proceeds, which she can proceed to invest as she likes to add to her retirement income. Third, the fact that promissory estoppel is raised as defence does not mean that partition and sale should be refused. In Billimoria v. Mistry, 2021 ONSC 1939 the Court ordered partition and sale in spite of the fact that the party opposing the sale claimed promissory estoppel. In this case there can be no basis for a finding that the motion judge made a palpable and overriding error in finding that ordering the sale of the property would not facilitate any malicious, vexatious or oppressive conduct.

[28] There is no merit to the argument that the motion judge denied Ms. Sun procedural fairness by failing to address her argument regarding promissory estoppel. First, as she points out, he did address it by his reference to the Statute of Frauds. Second, whether the alleged agreement was covered by the Statute of Frauds or not, the motion judge turned his attention from the alleged defence to the issue that he had to decide – whether Ms. Sun had met her onus of demonstrating malicious, vexatious or oppressive conduct on the part of Ms. Leung. He clearly decided that she had not.

The Justice of the Case

[29] The justice of the case is the overarching consideration when it comes to deciding whether or not to grant an extension of time for appealing an order.

[30] First, it is worth noting that “lack of merit alone can be a sufficient basis on which to deny an extension of time” (Enbridge Gas Distribution Inc. v. Froese, 2013 ONCA 131 at para. 16). Thus, even if the other factors militate in favour of granting an extension, the extension may still be denied if the appeal is found to have no merit Hughes v. Hughes, 2021 ONSC 4497 (Divisional Court)). This is particularly the case where what is sought is an extension to apply for leave to appeal.

[31] In this case, in addition to the lack of merit, there are other factors that militate in favour of refusing the extension. The first is Ms. Sun’s conduct throughout the litigation. Instead of taking the steps necessary to ensure that the litigation can proceed expeditiously, she has done the opposite. Most egregiously, she has breached court orders designed to move the litigation forward, including a court order for extensive disclosure. When it came to pursuing her appeal, while I accept that the first notice may have been filed in error in the wrong court, once the error was discovered, instead of moving expeditiously to obtain consent to file a proper notice, Ms. Sun’s counsel filed a misleading affidavit of service. Once it was clear that a motion to extend was necessary, Ms. Sun’s counsel took over two months to bring that motion. The fact that counsel was out of the office for just over two weeks does not explain the rest of the delay.

[32] The second factor is the prejudice that Ms. Leung has suffered. It is she who has to pay the expenses in relation to the property and it is Ms. Sun who is collecting the income from the property. Further, in order to do so, Ms. Leung and her husband have to live in a rented basement apartment while Ms. Sun enjoys comfortable accommodation in a house that she owns. Finally, Ms. Sun has breached two court orders designed to address this unfairness.

[33] Given these factors and the lack of merit in the appeal, I find that the justice of the case militates in favour of denying Ms. Sun’s motion for leave to extend.

The MOtion for a stay

[34] If I had granted leave to extend the time for the filing of the appeal, I would have denied the motion for a stay of the Order.

[35] In order to obtain a stay the moving party must demonstrate that the appeal raises a serious issue to be tried, that the moving party will suffer irreparable harm if the stay is not granted and the balance of convenience favours the granting of a stay (see for example, Ernikos v. Ernikos, 2016 ONSC 6752 and McCain v. Melanson, 2017 ONSC 2266).

[36] As already outlined above, there is no merit to Ms. Sun’s appeal.

[37] With respect to irreparable harm, Ms. Sun has sworn in her affidavit of December 7, 2023 that she does not intend to live in the property. If, as she has sworn, the property is meant to be a source of rental income, Ms. Sun can take her share of the proceeds and use it to generate income. Irreparable harm refers to harm that cannot be quantified in monetary terms and cannot be cured (RJR-MacDonald Inc. v. Canada (AG), 1994 117 (SCC), [1994] 1 SCC 311). There is no such harm in this case.

[38] Finally, the balance of convenience favours denying the stay. Ms. Sun has an encumbrance free waterfront home that she owns and lives in. She is paying almost none of the expenses relating to carrying the property at issue. She is collecting the rental income from that property and breaching court orders that require her to share that income. Ms. Leung, on the other hand, is paying the expenses on the property, leaving her with no income to afford a satisfactory home for herself or her husband.

Conclusion

[39] For these reasons the motion is dismissed. The parties shall address me in writing on the question of costs. Ms. Leung shall file her submissions within ten days of the release of these reasons. Ms. Sun shall have ten days from receipt of Ms. Leung’s submissions to respond, the submissions shall not exceed 3 pages. They shall be forwarded to the Divisional Court office and uploaded to CaseLines.

Sachs J.

Date: May 23, 2024