Court File No.: FS-16-0057 Date: 2017-05-17

Ontario

Superior Court of Justice

Between:

Khim Kaing, Applicant (Responding Party) C. Croiset Van Uchelen, for the Applicant (Responding Party)

• and -

Trevor Shaw, Respondent (Moving Party) S. Ettinger, for the Respondent (Moving Party)

Heard: April 27, 2017, at Thunder Bay, Ontario

Before: Mr. Justice D.C. Shaw

Decision On Motion

[1] The respondent, Trevor Shaw, brings a motion for summary judgment under Rule 16 of the Family Law Rules for sale of a home at 837 McMillan Street, Thunder Bay, which he owns jointly with the applicant, Khim Kaing. Mr. Shaw relies on s.3 of the Partition Act, R.S.O. 1990, c.P.4. Ms. Kaing opposes the sale of the home at this time.

[2] Mr. Shaw and Ms. Kaing began cohabitating in British Columbia, in January 2002. They have three children, ages seven, six and four years.

[3] The parties moved to Thunder Bay in July 2013. Mr. Shaw’s family is in Thunder Bay. In May 2013, in advance of their move, they purchased the home at 837 McMillan Street (“the family home”) as joint tenants.

[4] The parties resided together in the family home with the children until they separated in September 2015.

[5] Since separation, Ms. Kaing and the children have lived in the family home. The family home has three bedrooms and is 1473 square feet, with an unfinished basement. It is located in the south ward of the city.

[6] Mr. Shaw lives in a one bedroom apartment in the north ward of Thunder Bay. He pays rent of $650.00 per month.

[7] Ms. Kaing pays the mortgage, taxes and utility costs for the family home. The mortgage payment is $398.40 per month. Taxes are $191.08 per month.

[8] In July 2016, the family home was appraised at a market value of $135,000.00. The principal amount presently outstanding on the mortgage is $87,803.00.

[9] Mr. Shaw is employed at the Thunder Bay Charity Casino as a part-time slot technician at an income of $30,000.00 per year. Pursuant to an order of Justice Pierce made on June 29, 2016, Mr. Shaw has been paying to Ms. Kaing child support of $493.00 per month. Under the Child Support Guidelines this is reflective of a yearly income of $24,000.00, which Mr. Shaw had been earning until recently, although the order recites that the $493.00 support is based on a yearly income of $30,000.00. Mr. Shaw acknowledges that at his actual present yearly income of $30,000.00, support under the Child Support Guidelines should be $600.00 per month. Mr. Shaw’s payments under the June 29, 2016 order are in good standing.

[10] Ms. Kaing is not employed. She attends Confederation College as a full-time student. She deposes that she will graduate in April 2018 with a 3-year advanced diploma which will qualify her for a human resources designation. She anticipates that with that designation she will be able to find at least an entry level position with a salary in the range of $40,000.00 to $60,000.00. Her present income is limited to the child support payment of $493.00 per month and a Canada child benefit payment of $1703.41 per month.

[11] In addition to the jointly owned home in Thunder Bay, the parties also jointly own a house in Nanaimo, British Columbia. Ms. Kaing’s parents reside in that house. The rent that they pay to Ms. Kaing covers the mortgage, taxes and utilities for the house. That house has been appraised at $335,000.00 and has a mortgage in the principal amount of approximately $211,000.00.

[12] Mr. Shaw submits that Ms. Kaing has refused to deal in a reasonable manner with the disposition of the family home and the house in Nanaimo. He states that she is stalling because the status quo is beneficial to her and her parents.

[13] Mr. Shaw submits that because of his modest income, he can only rent a one bedroom apartment. He submits that this limits his access to the children because the apartment is too small for extended visits.

[14] Mr. Shaw submits that because his equity is tied up in the family home and in the Nanaimo house, he is unable to rent or buy a home. He produced advertisements for homes in Thunder Bay with two to three bedrooms which rent from $1,000.00 to $1,500.00 per month, plus utilities. He has neither the money for a down payment nor can he qualify for what would be a third mortgage in his name.

[15] If an order is granted to compel the sale of the family home, Mr. Shaw’s first preference would be to purchase Ms. Kaing’s one-half interest. The family home was previously owned by Mr. Shaw’s family and he lived in the home for part of his childhood.

[16] Mr. Shaw is prepared to delay any closing date for the sale of the family home until after June 30, 2017, to allow the children to finish their school year.

[17] Mr. Shaw submits that delaying a decision on the sale of the family home until trial would be prejudicial to him and not in the best interest of the children because he will be unable to obtain appropriate accommodation during that time to allow him to care for the children.

[18] Counsel for Mr. Shaw estimates that the trial in this matter will be held in either the coming fall or early winter. A settlement conference was held on November 25, 2016. A further settlement conference was ordered to be held by April 30, 2017, although that does not appear to have happened.

[19] Ms. Kaing deposes that the children have spent the majority of their lives in the family home. They have an uncle who lives next door and an aunt who lives one street over. Ms. Kaing deposes that the uncle and aunt assist her from time to time in the care of the children. The children’s daycare and school are close to the home. One child is in grade two and one child is in senior kindergarten.

[20] Ms. Kaing deposes that she does not have the financial resources to move from the family home. She deposes that the homes for rent in the advertisements produced by Mr. Shaw are beyond her financial ability to pay. Moreover, some are too small and some would take her children out of their neighbourhood, away from their relatives, friends, school and daycare.

[21] Ms. Kaing submits that after she graduates and obtains employment she will be in a position to bid on the family home, or to purchase Mr. Shaw’s one-half interest, or to find other suitable accommodation for the children. She submits that to require the house to be sold while she is unemployed, in full-time attendance at school and caring for three children amounts to malicious and oppressive conduct.

Discussion

[22] Because the parties are not married, the family home is not a matrimonial home within the meaning of the Family Law Act. The provisions of Part II of the Family Law Act regarding exclusive possession of a matrimonial home are therefore not applicable to the facts of this case.

[23] Section 2 of the Partition Act provides that all joint tenants may be compelled to sell the land. Where the property in question is not a matrimonial home, there is a narrow standard for the exercise of the court’s discretion to refuse the prima facie right of a joint owner to partition and sale.

[24] The standard for the exercise of the court’s discretion has been stated by the Ontario Court of Appeal in Latcham v. Latcham, [2002] O.J. No. 2126 (Ont. C.A.), namely, that to deny an application for sale, the party seeking the sale must be guilty of malicious, vexatious or oppressive conduct.

[25] In Greenbanktree Power Corp. v. Coinmatic Canada Inc., [2004] O.J. No. 5158, at para. 1, the Court of Appeal confirmed that Latcham set out the appropriate test. At para. 2, the Court of Appeal stated:

Co-tenants should only be deprived of this statutory right in the limited circumstances described above, with this caveat. In our view, “oppression” properly includes hardship, and a judge can refuse partition and sale because hardship to the co-tenant resisting the application would be of such a nature as to amount to oppression.

[26] In Akman v. Burshtein, at para. 38, Ferrier J. held:

Any allegation of malicious, vexatious, or oppressive conduct should relate to the partition and sale issue itself. Specifically, it is necessary to look at the reasonableness of the positions taken by the parties as it relates to the application for partition and sale. [Osborne v. Myette, 2004 Carswell Ont. 3331 (S.C.J.) at para. 12].

[27] In Kaphalakos v. Dayal, 2016 ONSC 3559 (Div. Ct.), the Divisional Court allowed an appeal from the decision of the motion judge who had granted summary judgment on a motion for partition and sale. The property was a home owned jointly by two elderly unmarried parties. The respondent on the appeal had brought a motion under the Partition Act for sale of the home. The appellant had been attacked in the home with a hammer and was critically injured. The respondent was charged with a number of criminal offences, including attempted murder.

[28] The Divisional Court reviewed and agreed with the principles set out above in Latcham and in Akman. The Divisional Court held that because the respondent was a co-owner of the property, the respondent’s motion for sale could not be described as vexatious.

[29] That left the issue of whether the respondent’s motion for an order for sale was oppressive.

[30] The Divisional Court reviewed and adopted the statement of the Court of Appeal in Greenbanktree that oppression properly includes hardship. The Divisional Court stated, at para. 30:

The “oppression inquiry” was described by Emery J. in Morris v. Donegan, 2015 ONSC 3360, 11 E.T.R. (4th) 88, at para. 138, “I am of the view that this factor requires the court consider any evidence on the effect of the sale…. to determine if the combined cause-and-effect of the sale amounts to oppression.”

[31] The Divisional Court in Kaphalakos held that the motion judge was in error in finding that if she accepted the applicant’s affidavit those facts were not capable of supporting a conclusion that the bringing of the motion for sale was oppressive. At para. 39, the Divisional Court held:

Bringing the motion results in the sale of the property and the sale of the property deprives the appellant of a place to live at a time when, if you accept her affidavit, she is physically and mentally impaired and has no place to live. Such a result is capable of supporting a finding that the bringing of the motion is oppressive: see for example Klakow v. Klakow (1972), 7 R.F.L. 349 (Ont. S.C.).

[32] Greenbanktree concerned five commercial properties in which the co-tenant applying for sale under the Partition Act had a minority interest. The Court of Appeal observed that the properties were commercial properties, owned by sophisticated commercial parties. The Court of Appeal found that the test set out in Latcham as to the scope of discretion under the Partition Act was the appropriate one, “particularly in a commercial context.” The Court of Appeal went on to say:

The Act gives tenants in common a prima facie right to compel partition or sale. A narrow interpretation of the discretion makes commercial sense by enhancing predictability.

[33] The property in question in the instant case is not a commercial property. It is a family home. There is not the imperative of predictability of a commercial case which would mandate a narrow view of the scope of discretion as to what constitutes hardship.

[34] This family home is the residence of three young children and the parent who is their primary caregiver. In my view, it is appropriate in the circumstances of this particular case to consider hardship not just to the joint tenant resisting the application but also to the three children in her care who will be directly, and in my view, adversely affected by a forced sale at this time. The sale of the family home will deprive the children of a place to live at a time when Ms. Kaing has no means to obtain reasonable alternative accommodation. The mortgage and taxes payable on the family home are under $600.00 per month. This is considerably less than the rent for the rental homes that Mr. Shaw lists as comparable. Ms. Kaing’s income is limited to child support and Canada child benefits. Mr. Shaw deposes that at his income, which is presently $30,000.00 per year, he is unable to obtain an apartment or home larger than the one bedroom apartment in which he presently resides. Mr. Shaw’s income is greater than Ms. Kaing’s. It is not clear whether Mr. Shaw is suggesting that Ms. Kaing should be required to use her share of the equity in the family home to pay rent for alternative accommodation. If this is his suggestion, I do not accept that pending trial Ms. Kaing should be required to spend her limited capital on a rental residence for her and the children.

[35] Mr. Shaw submits that with her one-half share of the equity on the family home, which after the costs of sale would be about $20,000.00, Ms. Kaing could buy another home comparable to the family home. In my view, it is reasonable to assume that Ms. Kaing would not at the present time qualify for a mortgage for the purchase of a home, even with a down payment of $20,000.00.

[36] In summary, a sale of the family home at this time would be disruptive to the lives of the children, uprooting them from their neighbourhood, their uncle and aunt, their friends, their school and their daycare, with no evidence that Ms. Kaing would be able to obtain reasonable alternative accommodation. It would be incompatible with their best interests.

[37] In my opinion, this would amount to hardship sufficient to find that the bringing of the motion for sale is oppressive. It warrants that I exercise my discretion to dismiss the motion.

Conclusion

[38] For the reasons given, Mr. Shaw’s summary judgment motion for sale of the home located at 837 McMillan Street, Thunder Bay is dismissed.

Costs

[39] At the conclusion of the hearing of the motion, counsel agreed that regardless of whether the motion was granted or dismissed, there should be no order of costs. Accordingly, no costs of this motion are ordered.

The Honourable Justice D. C. Shaw

Released: May 17, 2017