Court File and Parties

Citation: Holborn Chicopee GP Inc. v. Holborn Holdings Limited, 2024 ONSC 4291 Divisional Court File No.: 427/24 Date: 2024-07-31

Superior Court of Justice – Ontario Divisional Court

Re: Holborn Chicopee GP Inc., Moving Party -and- Holborn Holdings Limited, Respondent

Before: F.L. Myers J.

Counsel: Craig Aitken, for the Moving Party Eli Karp, for the Respondent

Heard at Toronto: July 31, 2024

Endorsement

[1] The Moving Party sues for specific performance of an alleged agreement to buy land from the Respondent for $37 million. The agreement was not signed, but the Moving Party submits that there was an exchange of e-messages in which the Respondent or its agent agreed to sign the draft agreement.

[2] The Moving Party obtained a CPL on short notice in the absence of the Respondent. On finding only that the Moving Party asserted an interest in the land, the judge also granted an interlocutory injunction prohibiting the Respondent from dealing with the land at all.

[3] The Respondent moved to set aside the order after it had an opportunity to put forward its evidence. By order dated July 11, 2024, J. Ramsay J. set aside the prior order. He held there was no agreement signed and that the property was an investment property in any event. He also ordered the Moving Party to pay costs on a substantial indemnity basis as he found that the initial motion for a CPL and injunction should not have been brought.

[4] The Moving Party seeks leave to appeal from the order of J. Ramsay J. removing its CPL. It says he treated the motion as a return of an ex parte injunction rather than deciding a contested CPL based on the Dhunna factors. As noted previously, there was an injunction at issue as well. It was not obtained ex parte. But the notice was so short and service sufficiently doubtful that the judge seems to have treated the matter afresh.

[5] The Moving Party seeks to schedule a motion for a stay of the order of J. Ramsay J. in order to keep the CPL in place pending the determination of the motion for leave to appeal. The Respondent resold the land in May of this year and would like to close the sale as soon as it is clear of the Moving Party’s claims. The Respondent resold the land on the very day the Moving Part obtained its CPL and injunction and while there was a Caution already registered on title by the Moving Party. Arguably the purchaser bought with notice of the Moving Party’s claims.

[6] The Moving Party submits that if its CPL is not kept in place, it will lose it appeal right – or its right to seek leave to appeal.

[7] At the same time, the Moving Party is concerned that an order lifting a CPL in a claim for specific performance may amount a final order. If title moves, arguably its claim will be defeated. It is concerned that that the order of J Ramsay J. may therefore be a final order that is appealable as of right to the Court of Appeal. Mr. Aitken will bring a parallel Notice of Appeal in the Court of Appeal and then deal with the jurisdiction of that court there. As the order lifting the CPL leaves the underlying litigation ongoing, in my view this court should continue its proceeding in the ordinary course unless or until the Court of Appeal says that the order is “final.”

[8] The Respondent is willing to acceded to a very brief interim, interim stay pending the early return of an urgent motion for a stay pending leave to appeal. Mr. Karp is of the view that the Moving Party has no right to a stay. Irreparable harm is in issue given that the land is an investment property. The Respondent submits that it is a sufficiently unique opportunity that it would be unjust to confine the Moving Party to a remedy in damages. There is also a question as to whether the Moving party, a special purpose purchaser corporation, can make a meaningful undertaking in damages. There is an issue about the balance of convenience as each side knew that the other was active in the first quarter of this year. The Respondent says that the Moving Party delayed acting until late May knowing that the Respondent was negotiating with a new purchaser. The Moving Party says that the Respondent and its purchaser knew that the Moving Party asserted its right to buy the land. Mind you, I was not told that the Moving Party ever tendered the purchase price to show it was ready, willing, and able to close.

[9] In convening this case conference, the court advised the parties that in this situation, rather than requiring the parties to spend the next several weeks investing $50,000 on a contested motion for a stay pending the hearing of the motion for leave to appeal, it is the practice of this court to expedite the hearing of the motion for leave to appeal. With Mr. Aitken currently away on a family vacation, the motion for a stay could not realistically be made returnable before the week of August 19, 2024. I can schedule the motion for leave to appeal two weeks later to be read during the week of September 3, 2024. Moreover, the motion for leave to appeal can be combined with a motion for a stay pending the hearing of the appeal proper if leave to appeal is granted. The panel that reads the motion for leave to appeal can decide if it is prepared to deal with the request for a stay in writing or whether it might schedule further steps pending a hearing by a single judge.

[10] I am specifically not ruling on whether the Moving Party can meet the three-part RJR-MacDonald test to obtain a stay pending appeal. That will be for the panel. Rather, with counsel away, the court on summer skeletal staffing, and the Respondent willing to give a very brief period of time to allow the Moving Party to bring on a contested stay pending leave to appeal, in my view, it is appropriate instead to simply expedite the motion for leave to appeal and grant an interim stay of the order of J. Ramsay J. pending the release of the panel’s decision on leave to appeal (and perhaps a further stay).

[11] There is no realistic basis to have an expedited motion heard sooner and, frankly, little point in doing so with only a week or two difference in the time to a decision. This is not a question of inunction law. Rather it is a matter of case management and a judge making common sense directions with an eye to keeping a civil proceeding efficient, affordable, and proportional. I am granting a stay without proof of the formal legal test usually required for a stay. I am frankly using scheduling and the ability to expedite to keep the parties and the court from having to undertake a very significant and extraordinary motion that may be proven completely unnecessary just a week or two later.

[12] I have no evidence before me. I am deciding based on counsel’s brief oral submissions only. Therefore, I am not to be taken to be making any findings of fact or law. Nor am I making even a hint of a suggestion that I see any basis to grant leave to appeal from the order of J. Ramsay J. All of that will be for the panel.

[13] The motion for leave to appeal will be read by the panel sitting during the week of September 3, 2024.

[14] The Moving Party will deliver all of its motion materials (including for a motion for a stay pending appeal if sought) on or before August 19, 2024. The Respondent shall deliver its responding materials by August 30, 2024. Nothing prejudices the right of the Respondent to submit in it material for the panel that it needs more time or procedural steps to deal with the motion for a stay of proceedings, if brought.

[15] Upon the Moving Party serving on the Respondent and filing with the court a sworn undertaking on damages given by a principal or affiliate of the Moving Party that contains an express representation that the person giving the undertaking has sufficient unencumbered liquid assets to pay forthwith up to $5 million in damages if called upon by the court to do so, the order of J. Ramsay J. dated July 11, 2024 in this proceeding is stayed pending the outcome of the motion for leave to appeal or further order of this court. The undertaking shall expressly commit the person who gives it to abide by any order concerning damages that the court may make if it ultimately appears that the granting of this stay order has caused damage to the Respondent for which the Moving Party ought to compensate the Respondent.

F.L. Myers J.

Date: July 31, 2024