Court File and Parties

COURT FILE NO.: 14-CV-502896 DATE: 20170725 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: City of Toronto and Ann Borooah, Chief Building Official for City of Toronto, Applicants AND: Nikolaos Lambrinos and 1187310 Ontario Limited, Respondents

BEFORE: Penny J.

COUNSEL: Naomi Brown and Kitto Lau for the Applicants Angela Assuras for the Respondents

HEARD: July 20, 2017

Endorsement

[1] In my handwritten endorsement of July 20, 2017, I dismissed the respondent’s motion, with more detailed reasons to follow. These are those reasons.

[2] This is a motion by the respondents for a stay of execution of the judgment of Mr. Justice Akhtar dated July 14, 2016. Justice Akhtar granted the City’s application in full and ordered the removal of all illegal construction carried out by the respondents at properties municipally known as 102 and 104 Ulster St. in the City of Toronto.

[3] Justice Akhtar found there had been unauthorized construction carried out by the respondents over a period of several years without the benefit of building permits. The illegal construction included front and rear additions at every floor level so as to illegally convert the use of the buildings from two single-family semi-detached dwellings to 12 residential rental units. This construction violated important, substantive building code provisions. Justice Akhtar described the respondent’s conduct as revealing a “tortured history of continuous, flagrant violations of bylaws, regulations and orders.” He found that the illegal construction and conversions were carried out in violation of the Building Code Act and the Ontario Building Code and applicable zoning bylaws and flagrantly disregarded health and safety of occupants to whom the respondents leased these illegal units. Justice Akhtar accepted the evidence of the applicants that these violations rendered the properties one of the worst “fire traps” that City staff had ever seen.

[4] There was in fact a fire at 104 Ulster in March 2015 which thankfully, as a result of prior orders of the City requiring that property to be vacated, did not result in any personal injury or death. Following the fire, the City issued an Emergency Order prohibiting occupancy altogether.

[5] The respondents’ attempt to appeal the Judgment was dismissed on the basis that the appeal lacked any merit. Costs of over $50,000 were assessed against the respondents for the application and the attempted appeal. These costs have not been paid.

[6] The respondents argue that they have in good faith attempted to obtain the necessary approvals and building permits from the City to cure the defects. They argue that this process involves several stages, the first being plans submitted for zoning review culminating in a zoning notice and thereafter an application for committee of adjustments (and possibly OMB hearing) and finally, a building permit application.

[7] The respondents argue that their efforts to “regularize” the construction at these two properties has been “thwarted” by the City. In the face of this alleged lack of cooperation, they seek a stay of enforcement of the Judgment of Justice Akhtar.

[8] The respondents take the position that the applicable test is the three-part test for a stay under RJR MacDonald - triable issue, irreparable harm and balance of convenience. They take the position that they have a prima facie case for relief, that they will suffer irreparable harm if the stay is not granted and that the balance of convenience favours granting the stay.

Analysis

[9] The respondents seek to characterize themselves as hapless victims of a labyrinthine bureaucracy that has thwarted their efforts to comply with Justice Ahktar’s Judgment. Nothing could be further from the truth. In my view, the respondents’ conduct is nothing less than a continuation of the “tortured history of continuous, flagrant violations of bylaws, regulations and orders” found by Justice Ahktar. The respondents are not victims; they are the authors of their own misfortune.

[10] In effect, the respondents have conditioned their alleged efforts to comply with the Judgment upon applications to change the zoning and/or approve new building code proposals at the site. It is clear the respondents are hoping to “regularize” the defects through new zoning and/or new building code approvals or, at the very least, to combine the demolition work necessary to remove the unlawful renovations with new designs and work for which new approvals are being sought.

[11] Justice Akhtar’s Judgment contained no such conditions. The Judgment specifically and unambiguously ordered the respondents to remove all unauthorized construction within 60 days failing which the City was authorized to do so on its own, with the cost of the work being added to the tax rolls for the properties. No City approvals are required to comply with Justice Ahktar’s Judgment.

[12] Justice Akhtar did not grant the respondents time to obtain new approvals or permits from the City in an effort to “regularize” the illegal construction or to combine it with future redevelopment plans. The Judgment required them to remove that illegal construction within 60 days. Indeed, Justice Akhtar accepted the City’s evidence on the application that it would be impossible for the respondents ever to obtain approvals for the construction as built, given the many violations of the Ontario Building Code, and that any new development proposal would inevitably necessitate significant overhaul of the buildings and substantial demolition of the unauthorized and illegal construction. Thus, the issues raised by the respondents on this motion were, in substance, before Justice Akhtar on the original application.

[13] I do not share the respondents’ view that three-part test under RJR-MacDonald is applicable in the circumstances. The stay of a final judgment, from which no appeal or an unsuccessful appeal (as in this case) has been taken, stands in a very different position from an ordinary motion for an interlocutory injunction or stay. The burden on a motion to stay enforcement of a final judgment is significantly higher. As the Divisional Court said in 1247902 Ontario Inc. v. Carlisle Power Systems Ltd. 2003 O.J. No. 6300 (para.9):

There is good reason for the bar to have been set so high. As the earlier authorities have so often stated, judgments ought to be considered final and creditors should have unencumbered rights of enforcement. For a defendant to be able to raise equitable grounds at that stage would derogate from the notion of finality. It would frustrate commercial enterprise and needless to say would encourage a whole new area of litigation. Moreover, a stay could result in real unfairness to a particular creditor as it would not prevent the emergence of other legitimate creditors who are not stayed. Furthermore, there would also be the potential that under a stay the value of an asset might be affected and indeed diminished by way of mortgaging or tax arrears.

[14] The test for a stay in connection with a final judgment of the court under s. 106 of the Courts of Justice Act was articulated by the Divisional Court as follows (para 10):

…in very rare circumstances there is discretion under section 106 of the CJA to stay the enforcement of final judgment. This discretion ought to be used very sparingly and only in circumstances where it could be found that not only would it [the enforcement] be oppressive or vexatious or an abuse of process of the court, but also in circumstances where it would not cause an injustice to the plaintiff.

[15] As I said in my handwritten endorsement, the City’s conduct is in no way oppressive, vexatious or an abuse of process of the court. The City’s handling of the respondent’ zoning and new building applications is quite irrelevant to the enforcement of the Judgment of Justice Akhtar. The respondents have flagrantly violated the Judgment on the basis of an entirely specious argument that a necessary precondition to the respondents’ compliance with the Judgment is the City’s cooperation in the prompt processing of the respondents’ new development plans for the site. It is the respondents’ motion which is frivolous, vexatious and an abuse of process of the court.

[16] Nor can it be said that the City would suffer no injustice if a stay of the Judgment were granted. The City is responsible for the public interest in connection with building construction and renovation. As found by Justice Akhtar, the violations involved in this case are a threat to public safety, among other things. The City has a strong interest in the enforcement of the Judgment. This interest would be seriously adversely affected were the Judgment to be stayed.

[17] Even if three-part test under RJR-MacDonald were applicable, I would have dismissed the motion. The respondents cannot meet part one of the test. The motion is completely lacking in merit. It is an attempt to relitigate issues that were before Justice Akhtar and to condition their compliance with Justice Akhtar’s Judgment on matters that are unrelated to, and clearly not consistent with, that Judgment. There would be no irreparable harm to the respondents. The respondents will not “lose” the properties as a result of the City’s execution on the Judgment nor will there be any “eviction.” There is simply a need to relocate temporarily until the work is complete. The illegal construction must be removed regardless of any future site development proposals. Justice Akhtar found that it would be impossible to preserve and obtain approvals for the illegal construction in any event. Finally, the balance of convenience clearly favours the City which is, as noted above, representing the public interest in ensuring that buildings are safe for occupancy and comply with applicable building standards.

[18] For these reasons, the motion for a stay is dismissed. In order for the respondents to have adequate time to vacate and remove personal possessions, the City shall not commence the work before midnight, July 30, 2017. The respondents shall vacate the properties by that time.

[19] Costs are awarded to the City fixed in the amount of $10,000 (inclusive of fees disbursements and all applicable taxes) payable by the respondents forthwith.

Penny J. Date: July 25, 2017