The Law Society of Upper Canada v. Chiarelli
[Indexed as: Law Society of Upper Canada v. Chiarelli]
Ontario Reports
Ontario Superior Court of Justice,
Goldstein J.
March 19, 2013
115 O.R. (3d) 53 | 2013 ONSC 1428
Case Summary
Landlord and tenant — Residential tenancies — "Landlord" — Respondent appearing before Ontario Landlord and Tenant Board as paid representative of landlord — Respondent providing legal services rather than appearing as "personal representative" within definition of [page54 ]"landlord" in Residential Tenancies Act — "Personal representative" in definition of "landlord" having its ordinary estates law meaning and not including paid agent — Respondent violating Law Society Act by providing legal services without licence — Permanent injunction granted restraining respondent from appearing before board or doing any other work that should be done by legal professional — Law Society Act, R.S.O. 1990, c. L.8 — Residential Tenancies Act, 2006, S.O. 2006, c. 17.
The respondent was in the property management business and appeared regularly before the Ontario Landlord and Tenant Board on behalf of landlords. He was not a lawyer or a licensed paralegal. He claimed that he appeared before the board as a "personal representative" within the definition of "landlord" in the Residential Tenancies Act, 2006. When he appeared before the board on behalf of a landlord in an application to terminate a residential tenancy, the board member found that he did not fall within the category of "landlord" for the purposes of the Act. The Law Society subsequently applied for a permanent injunction restraining the respondent from appearing before the board or doing any other work that should be done by a legal professional.
Held, the application should be granted.
The respondent was providing legal services in violation of the Law Society Act when he appeared before the board. "Personal representative" in the definition of "landlord" in the Residential Tenancies Act, 2006 should be given its ordinary estates law meaning and does not include a paid agent. It was in the public interest to issue an injunction. The public interest is best served when properly licensed legal professionals appear before administrative tribunals. The doctrine of abuse of process applied. The issue before the court -- whether the respondent was practising law when he appeared before the board, and whether any exceptions applied -- was the exact issue that the board member considered and decided. It would bring the administration of justice into disrepute if the correct decision of the board member could be relitigated on this application.
Cases referred to
Duke's Trailer Court Ltd. v. Block, [1997] O.J. No. 2415, 41 O.T.C. 129, 10 R.P.R. (3d) 194, 71 A.C.W.S. (3d) 1165 (Gen. Div.); Megan Investments Ltd. v. Funston, [1992] O.J. No. 1290, 25 R.P.R. (2d) 63, 34 A.C.W.S. (3d) 330 (Gen. Div.); Mercedes Homes Inc. v. Grace, [1993] O.J. No. 2610 (Gen. Div.); Peel v. Smith, [1994] O.J. No. 2971 (Gen. Div.), consd
Other cases referred to
Canada v. IPSCO Recycling Inc., [2003] F.C.J. No. 1950, 2003 FC 1518, [2004] 2 F.C.R. 530, 243 F.T.R. 72, 6 C.E.L.R. (3d) 1, 128 A.C.W.S. (3d) 791; Fair Estate v. Fair Estate, 1971 1097 (NS CA), [1971] N.S.J. No. 101, 17 D.L.R. (3d) 751, 2 N.S.R. (2d) 556, [1971] I.L.R. Â1-433 at 178 (C.A.); Law Society of Upper Canada v. Augier, [2013] O.J. No. 350, 2013 ONSC 451 (S.C.J.); Toronto (City) v. Canadian Union of Public Employees (C.U.P.E.), Local 79, [2003] 3 S.C.R. 77, [2003] S.C.J. No. 64, 2003 SCC 63, 232 D.L.R. (4th) 385, 311 N.R. 201, J.E. 2003-2108, 179 O.A.C. 291, [2003] CLLC Â220-071, 17 C.R. (6th) 276, REJB 2003-49439, 120 L.A.C. (4th) 225, 59 W.C.B. (2d) 334
Statutes referred to
Landlord and Tenant Act, R.S.O. 1990, c. L.7
Law Society Act, R.S.O. 1990, c. L.8 [as am.], ss. 4.2, 26.1, 26.3
Residential Tenancies Act, 2006, S.O. 2006, c. 17, s. 2 [page55 ]
APPLICATION for a permanent injunction.
Simon Bieber and Erin Pleet, for applicant.
Joseph Kary, for respondent.
[1] GOLDSTEIN J.: — The respondent regularly appears before the Ontario Landlord and Tenant Board. He is not a lawyer and he is not a licensed paralegal. He says that he is actually in the property management business. He says that when he appears before the board he is the "personal representative" of the landlord. He therefore says that he does not need to be a licensed paralegal or a lawyer.
[2] The applicant Law Society of Upper Canada says that what the respondent is doing is actually providing legal services without a licence. The Law Society asks for a permanent injunction restraining the applicant from appearing in front of the board or doing any other work that a legal professional should do.
[3] I agree with the Law Society. When the respondent appears before the board as a paid representative, he provides legal services in violation of the Law Society Act.[^1] There will be a permanent injunction.
Background
[4] The respondent operates a sole proprietorship that provides what he calls "Landlord Services". He provides the following services to property owners:
-- renting out units;
-- collecting rent;
-- attending to tenant complaints;
-- leasing services;
-- credit and background checks on prospective tenants;
-- preparation of rental units for new tenants;
exercising the right of the landlord to enter into apartments for inspection and other purposes;
-- hiring cleaners and pest control services;
-- filing eviction orders with the sheriff. [page56 ]
[5] The respondent says that he previously appeared before the board in eviction proceedings, but has mostly given up that aspect of his property management business. He says he now regularly retains licensed paralegals to act at the board. He also says that he has health issues that impact his ability to physically appear before the board. Notwithstanding these assertions, he also says that if he could not appear before the board it would seriously impact his business. He says, and there is no evidence to contradict him, that he does not currently advertise that he provides legal services to prospective clients.
[6] The respondent says that he does not provide legal services and does not give legal advice. He says that he appears before the board as a "landlord" pursuant to s. 2 of the Residential Tenancies Act, 2006:[^2]
"landlord" includes,
(a) the owner of a rental unit or any other person who permits occupancy of a rental unit, other than a tenant who occupies a rental unit in a residential complex and who permits another person to also occupy the unit or any part of the unit,
(b) the heirs, assigns, personal representatives and successors in title of a person referred to in clause (a), and
(c) a person, other than a tenant occupying a rental unit in a residential complex, who is entitled to possession of the residential complex and who attempts to enforce any of the rights of a landlord under a tenancy agreement or this Act, including the right to collect rent.
[7] The respondent says that he appears as a landlord's "personal representative".
[8] In September 2011, the respondent appeared before the board on behalf of a landlord in an application to terminate a residential tenancy. The tenants challenged his standing to appear before the board. Board Member Carey found that as a paid property manager the respondent did not fall into the category of "landlord" for the purposes of the Act. The respondent argued before the board, as he did before this court, that he has standing to appear before the board as a "personal representative". Board Member Carey rejected that argument with the following comment:
Based on the interpretation put forward by VC, no one who is paid to appear before the Landlord and Tenant Board as a legal representative on behalf of another person would ever run afoul of the licencing requirement for legal [page57 ]representatives set out in the Law Society Act as they could all validly describe themselves as "personal representatives", a phrase that also appears in the definition of "tenant" in the Act. Clearly, it is contrary to any common sense approach to statutory interpretation for the Board to interpret "personal representatives" to include "paid legal representatives" as to do so would completely defeat the entire process of licensing legal professionals, and make the Board the only tribunal in Ontario where legal professionals can operate completely unregulated. Such a result would be an absurdity and cannot possibly have been the intent of the legislature in creating the Act or for that matter the Law Society Act.
[9] The Law Society subsequently brought this application to enjoin the applicant from practising law pursuant to the Law Society Act.
Analysis
[10] In my view, this application raises primarily legal issues. There are three issues to be determined:
Is the respondent exempt from the Law Society's licensing requirements?
If he is, should a permanent injunction be granted?
Does the doctrine of abuse of process apply?
1. Is the respondent exempt from the Law Society's licensing requirements?
[11] The respondent's position is that he is not practising law or providing legal services when he appears before the board. Rather, he argues that a long line of cases support his claim that, as a property manager, he is a landlord's "personal representative" and therefore a "landlord" for the purposes of the Residential Tenancies Act. He says that this gives him standing to appear before the board and that he does not need to be licensed.
[12] I agree with the Law Society that when the respondent appears before the board, he is providing legal services. Appearing before an administrative tribunal as a paid representative to make submissions, examine witnesses and cross-examine witnesses is quintessentially legal or paralegal work. The respondent himself tacitly acknowledges that it is legal or paralegal work, which is why he argues that he is exempt from licensing requirements because he is a "landlord" under the Residential Tenancies Act.
[13] The respondent argues that the definition of "landlord" is traditionally broad and incorporates many different kinds of entities. He points to Megan Investments Ltd. v. Funston, [1992] O.J. No. 1290, 25 R.P.R. (2d) 63 (Gen. Div.). [page58 ]The owner of a farm was a corporation. The main shareholder of the corporation required the property for occupation for himself and his family. A landlord may obtain a writ of possession and terminate a tenancy where he or she has a bona fide requirement to occupy residential premises for him or herself. The question was whether, under those circumstances, a corporation could be a landlord. Philp J. held that it could. Platana J. agreed with this conclusion in Duke's Trailer Court Ltd. v. Block, [1997] O.J. No. 2415, 10 R.P.R. (3d) 194 (Gen. Div.).
[14] The respondent also points to Mercedes Homes Inc. v. Grace, [1993] O.J. No. 2610 (Gen. Div.), where all parties conceded that the property management company could be the landlord for the purposes of bringing eviction proceedings. In Peel v. Smith, [1994] O.J. No. 2971 (Gen. Div.), the landlord's daughter had acted as her parent's agent with respect to a residential property. Leitch J. found that the daughter fell within the definition of "landlord" in the old Landlord and Tenant Act.[^3]
[15] The respondent's cases certainly support the proposition that the definition of "landlord" can be a broad one. In my view, however, these cases do no more than deal with the question of who may exercise the substantive legal rights of a landlord. It would be a real stretch to say that they regulate who may appear in front of a tribunal as a paid representative. That issue has nothing to do with the substantive legal rights of a landlord. These cases do not go that far. The Residential Tenancies Act provides very detailed sections as to what a landlord may do, and what a landlord's agent may do. I have no doubt that the respondent can be the landlord's agent but I would go no further than that.
[16] Even if these cases did support the respondent's interpretation, which they do not, they have surely been overtaken by the enactment of s. 26.1 of the Law Society Act, which states:
26.1(1) Subject to subsection (5), no person, other than a licensee whose licence is not suspended, shall practise law in Ontario or provide legal services in Ontario.
(2) Subject to subsections (6) and (7), no person, other than a licensee whose licence is not suspended, shall hold themself out as, or represent themself to be, a person who may practise law in Ontario or a person who may provide legal services in Ontario.
(3) No licensee shall practise law in Ontario or provide legal services in Ontario except to the extent permitted by the licensee's licence. [page59 ]
[17] The respondent also points to the board's interpretation guidelines, in particular Guideline #20, which states in part:
A corporate Landlord is also generally referred as the Landlord in most Board publications. The corporate Landlord named in the application may not be the owner of the property on title. For example, the named corporate Landlord may be a property management company hired by the owner of the building to manage the property. Provided that the property management company meets the definition of "Landlord" contained in Residential Tenancies Act, 2006 (the "RTA"), they are also properly identified as the Landlord.
However, if the Landlord is a corporation, the natural person who appears at the hearing to represent the corporate Landlord is generally referred to as either the Landlord's Legal Representative (if a licensed lawyer or paralegal) as described above, or, as the Landlord's Agent, as described below.
If the Landlord is a natural person but is represented by a person at a hearing other than a licensed lawyer or paralegal (e.g. a family member or friend appearing without charge to the landlord), this person is generally referred to as the Landlord's Agent in Board publications and orders.
If the Landlord is a corporation and is represented by a person other than a licensed lawyer or paralegal (e.g., an employee, or shareholder/officer of the corporation), this person is also generally referred to as the Landlord's Agent in Board publications and orders.
The term Landlord's Agent only refers to persons who are acting for the Landlord with respect to a Board proceeding. There may be different persons acting as the Landlord's agents for non-hearing relate purposes. For example, a superintendent may be a Landlord's agent for the purpose of discharging the Landlord's maintenance and repair responsibilities. The term "agent" is also used in paragraphs 29(1)2-6 of the RTA to refer to someone under the control or direction of the Landlord who has breached an obligation owed to the tenant. A Landlord's "agent" for the purposes of paragraphs 29(1)2-6 may not be the same person who has been identified in an order as the Landlord's Agent for the purposes of representing a Landlord in a Board proceeding.
[18] The guidelines clarify that they are intended to assist the parties in understanding the board's usual interpretation of the law and provide guidance to board members. The guidelines state that they are not binding on board members. Indeed, the guidelines cannot override the Law Society Act or the by-laws to the Law Society Act. In any event, I do not see how the guidelines assist the respondent. The guidelines clearly contemplate representation by a licensed lawyer or paralegal, except in the case of unpaid family or friends. What is obvious is that Guideline #20 contemplates a situation like that of Peel v. Smith, supra, where the daughter of the landlord had acted as their agent. The guideline does mention corporate landlords, where an [page60 ]employee, director or shareholder may act as the landlord's agent. In my view, the guideline contemplates the sort of small, family-owned corporation like that mentioned in Megan Investments Ltd. v. Funston, supra. The guidelines do not address the specific question of who is a landlord's "personal representative" for the purposes of acting before the board.
[19] The respondent argues that the term "personal representative" should not be given its ordinary meaning in estates law. I disagree. The Residential Tenancies Act does not define the term "agent" but clearly distinguishes between a "landlord" and an "agent". The respondent is unable to point to any authority for the proposition that a property manager can be a landlord's "personal representative" outside of the usual estates law context. Black's Law Dictionary defines "personal representative" as
[a] person who manages the legal affairs of another because of incapacity or death, such as the executor of an estate. Technically, an executor is a personal representative named in a will, while an administrator is a personal representative not named in a will.
See, also, Fair Estate v. Fair Estate, 1971 1097 (NS CA), [1971] N.S.J. No. 101, 2 N.S.R. (2d) 556 (C.A.).
[20] It is also clear that the legislature meant to give the term "personal representative" the traditional meaning. Given the phrase "heirs, assigns, personal representatives and successors in title", the legislature's intention is obvious. The definition is not meant to catch a paid legal representative in the position of the respondent. If it did, that interpretation would certainly clash with the intent of the legislature as set out in s. 26.1 of the Law Society Act.
[21] I agree with the respondent that the facts support his argument that he is a property manager. He may also be a landlord's agent for some purposes set out in the Residential Tenancies Act. It is irrelevant, however, whether or not the respondent is a property manager. The prohibition is not on property managers. The prohibition is in respect of unlicensed legal professionals. I agree with the basic conclusion reached by Board Member Carey: if the respondent is correct, then any paid person could appear before the board without meeting the licensing requirements. As noted, that is clearly contrary to the intent of the Law Society Act. The respondent has not provided any authority to suggest that the board is different from any other adjudicative body in Ontario in that regard. As a practical matter, there is nothing to prevent a property manager from retaining a licensed legal professional from appearing at the board as the landlord's agent in a situation where that property manager has the legal authority to exercise the rights of a landlord. He says that if the injunction is granted, he will be the only property manager in the province who is unable to initiate eviction proceedings against bad tenants. With respect, that is not correct -- again, there nothing to prevent him from retaining a licensed legal professional to carry out those aspects of his work that require the services of a licensed legal professional.
2. Should a permanent injunction be granted?
[22] The court's jurisdiction to issue a mandatory injunction is found in s. 26.3 of the Law Society Act:
26.3(1) On the application of the Society, the Superior Court of Justice may,
(a) make an order prohibiting a person from contravening section 26.1, if the court is satisfied that the person is contravening or has contravened section 26.1[.]
[23] The test for whether a statutory injunction should be granted is set out in Canada v. IPSCO Recycling Inc., [2003] F.C.J. 1950, 2003 FC 1518, at paras. 50-51:
There is, however, a significant distinction between an injunction authorized by statute and an injunction available to the Attorney General at common law. This distinction is aptly illustrated in Ontario (Minister of the Environment) v. National Hard Chrome Plating Co. (1993), 11 C.E.L.R. (N.S.) 73 (Ont. C. of J.). There, the statutory provision with respect to the granting of an injunction contemplated an injunction to "restrain" contravention of the statute. The Court concluded that because the statute only provided a basis for the issuance of a prohibitory injunction, a mandatory injunction was only available at common law at the request of the Attorney General suing in the public interest. Such common law relief was available only where the law was being flouted and the legislation was inadequate to protect the public interest.
On the basis of the authorities cited by the parties I am satisfied that where a statute provides a remedy by way of injunction, different considerations govern the exercise of the court's discretion than apply when an Attorney General sues at common law to enforce public rights. The following general principles apply when an injunction is authorized by statute:
i) The court's discretion is more fettered. The factors considered by a court when considering equitable relief will have a more limited application. See: Prince Edward Island (Minister of Communications and Cultural Affairs) v. Island Farm and Fish Meat Ltd., [1989] P.E.I.J. No. 32 (P.E.I.S.C.); Maple Ridge (District) v. Thornhill Aggregates Ltd. (1998), 1998 6446 (BC CA), 162 D.L.R. (4th) 203 (B.C.C.A.).
ii) Specifically, an applicant will not have to prove that damages are inadequate or that irreparable harm will result if the injunction is refused. See: Shaughnessy Heights Property Owners' Association v. North Up (1958) 1958 289 (BC SC), 12 D.L.R. (2d) 760 (B.C.S.C.); Manitoba Dental Association v. Byman and Halstead (1967) 1962 392 (MB CA), 34 D.L.R. (2d) 602 (Man. C.A.); Canada (Canadian Transportation Accident Investigation and Safety Board) v. Canadian Press, [2000] N.S.J. No. 139 (N.S.S.C.).
iii) There is no need for other enforcement remedies to have been pursued. See: Saskatchewan (Minister for Environmental Assessment Act) v. Redberry Development Corporation, 1987 4588 (SK KB), [1987] 4 W.W.R. 654 (Sask. Q.B.).
iv) The Court retains a discretion as to whether to grant injunctive relief. Hardship from the imposition and enforcement of an injunction will generally not outweigh the public interest in having the law obeyed. However, an injunction will not issue where it would be of questionable utility or inequitable. See: Saskatchewan (Minister of Environmental Assessment Act) v. Redberry, supra; Maple Ridge (District) v. Thornhill Aggregates Ltd., supra; Capital Regional District v. Smith (1998), 1998 6490 (BC CA), 168 D.L.R. (4th) 52 B.C.C.A.
v) It remains more difficult to obtain a mandatory injunction.
[24] I stated the following in Law Society of Upper Canada v. Augier, [2013] O.J. No. 350, 2013 ONSC 451 (S.C.J.), at para. 9:
The Law Society has an important role in protecting the public from the activities of unlicensed and unregulated persons. The respondent, for example, is not required to carry professional liability insurance, keep books and records for inspection by the Law Society, or maintain a trust account for client funds that can be audited by the Law Society. Indeed, the Law Society would have no right or ability to carry out a spot audit or any other kind of check in relation to the activities of the respondent, as it would for a licensed legal professional. That is why the Law Society has a duty to seek remedies against unauthorized persons practicing law or holding themselves out as legal professionals.
[25] In my view, the public interest in preventing the unauthorized practice of law so as to protect the public is the most important factor for a court to consider. Section 4.2 of the Law Society Act provides the legislature's guidance as to the principles to be applied by the Law Society:
4.2 In carrying out its functions, duties and powers under this Act, the Society shall have regard to the following principles:
The Society has a duty to maintain and advance the cause of justice and the rule of law.
The Society has a duty to act so as to facilitate access to justice for the people of Ontario.
The Society has a duty to protect the public interest.
The Society has a duty to act in a timely, open and efficient manner.
Standards of learning, professional competence and professional conduct for licensees and restrictions on who may provide particular legal services should be proportionate to the significance of the regulatory objectives sought to be realized. [page63 ]
[26] I find that it is in the public interest to issue an injunction in this case. The respondent acts as a legal professional without a licence when he appears before the board as a paid representative. The public interest is best served when properly licensed legal professionals appear before administrative tribunals. I see nothing inequitable about the injunction and therefore no basis to exercise my discretion against granting one.
3. Does the doctrine of abuse of process apply?
[27] The Law Society argues that Board Member Carey has already fully considered and rejected the respondent's arguments. As a result, the Law Society argues, it is an abuse of process for the respondent to relitigate these same issues. The respondent argues that since there are conflicting decisions from the board regarding representation by property managers, Board Member Carey's decision ought not to be considered binding and conclusive.
[28] I respectfully disagree. The doctrine of abuse of process may preclude litigation where the requirements of issue estoppel are not met: Toronto (City) v. Canadian Union of Public Employees (C.U.P.E.), Local 79, 2003 SCC 63, [2003] 3 S.C.R. 77, [2003] S.C.J. No. 64. Issue estoppel is not met in this case because the parties are not the same. The issue decided by Board Member Carey was made in the context of a landlord and tenant proceeding. The respondent was not a party. Nonetheless, the very issue that is before this court -- whether the respondent is practising law when he appears before the board, and whether any exceptions apply -- was exactly the issue that Board Member Carey considered and decided. The doctrine of abuse of process is invoked to prevent the administration of justice being brought into disrepute. In my view, it would bring the administration of justice into disrepute if the decision of Board Member Carey (which, I say with respect, was correctly decided) could be relitigated here.
Conclusion
[29] A permanent injunction will issue preventing the respondent from providing legal services in Ontario. I wish to make it clear that the mandatory injunction is not intended to impair his ability to make a living as a property manager and that there is nothing to stop him from retaining the services of a licensed legal professional where lawful and appropriate.
[30] Under the circumstances, I exercise my discretion and make no order as to costs.
Application granted.
Notes
[^1]: R.S.O. 1990, c. L.8.
[^2]: S.O. 2006, c. 17.
[^3]: R.S.O. 1990, c. L.7.
End of Document