CITATION: Son v. Khan, 2017 ONSC 962
COURT FILE NO.: CV-14-4313-00
DATE: 2017 02 08
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
YOUNG-HEW SON and YOUNG SON
S. Joon Bae, Counsel for the Plaintiff
Plaintiffs
- and -
DAUD AHMAD KHAN, ISAM MUNAJEED, RE/MAX REALTY SPECIALISTS INC., BROKERAGE, FAWAD KHAN AND ISHAW AHMAD KHAN
Self-represented
Defendants
HEARD: January 20, 2017
REASONS FOR JUDGMENT
LEMAY J
[1] There are two motions before me in this case. The first is by the Defendants to set aside a notice of garnishment. The second is a motion by the Plaintiffs to dismiss the Defendants’ motion and to strike out the Statement of Defence.
[2] The underlying action concerns a real estate transaction between these parties. The Plaintiffs allege that the Defendants failed to comply with an undertaking relating to mould. The Defendants dispute this claim. There have been a number of interlocutory proceedings in this matter, which have resulted in an Order under Rule 2.1.02 of the Rules of Civil Procedure against the Defendants.
[3] For the reasons that follow, both motions are being dismissed.
Background Facts
a) The Underlying Action
[4] The Defendant, Daud Kahn, sold the property municipally known as 3351 Cedar Creek Drive in Mississauga to the Plaintiffs, and the transaction closed on July 15th, 2014. This property appears to have been beneficially owned by Fawad Khan, who is Daud’s brother and other Defendant in this action.
[5] Prior to the closing of the transaction, mould was discovered in the basement of the home.
[6] Given the mould issues, the Plaintiffs were not prepared to close the transaction. The Defendants executed an undertaking to resolve these mould issues. The Undertaking was not complied with, as far as I am aware.
[7] The Defendants used a substantial portion of the proceeds from the sale of the Cedar Creek property to purchase a new house, which was put in the name of Daud Khan’s son, the Defendant Ishaq Khan.
[8] In September of 2014, the Plaintiffs brought this action against Daud Khan, as he was the seller. After discoveries were conducted, the involvement of Ishak and Fawad Khan became clear, and the Statement of Claim was amended on March 17th, 2016.
[9] After these amendments were made, the Plaintiffs moved to have a CPL put on the new property, which is municipally known as 11 Sunnyview Road, Brampton, Ontario. An interim CPL was granted on March 31st, 2016. A motion to continue the CPL was heard before Ricchetti J. on September 30th, 2016. Ricchetti J. permitted the CPL to continue (see reasons reported as Son v. Khan 2016 ONSC 6265). This summary brings me to the various Orders that have been made in this case.
b) The Procedural Orders to Date
[10] As I have noted above, a CPL was registered against the Sunnyview Property on March 31st, 2016. The matter was to return to Court on September 30th, 2016.
[11] In the meantime, the Plaintiffs brought a motion to compel answers to undertakings and refusals. This motion was heard by Bloom J. on September 15th, 2016, and an Order was made requiring the Defendants to pay $5,000.00 in costs, and provide answers to various undertakings. The Defendants sought leave to appeal this motion to the Divisional Court, and I will return to that issue below.
[12] The CPL motion returned to Court on September 30th, 2016, and Ricchetti J. granted a continuation of the CPL, with written reasons issuing on October 6th, 2016. A costs Order against the Defendants in the sum of $25,362.12 also flowed from this decision and was issued on November 2nd, 2016. It was subsequently determined that Mr. Khan had served costs submissions but not filed them with the Court. As a result, Ricchetti J. reconsidered his costs decision on December 6th, 2016 and upheld it.
[13] On November 18th, 2016, the Plaintiffs brought a further motion seeking compliance with the September 15th, 2016 Order of Bloom J. An Order requiring further compliance with Undertakings and with the Order of Bloom J. was granted, and additional costs were ordered.
[14] The Defendants sought leave to appeal the Order of Bloom J. to the Divisional Court. The Plaintiffs brought a cross-motion seeking to bar the Defendants from bringing any further motions. This motion was heard in writing by Price J., and a decision was released on December 6th, 2016. In that decision Price J. dismissed the application for leave to appeal, and granted the Plaintiff’s cross-motion. Price J. directed that:
[36] For the reasons stated above, it is ordered that:
The defendants’ motion for leave to appeal is dismissed.
The plaintiffs’ motion to require the defendants to seek leave before bringing future motions is allowed.
The defendants shall seek leave of the court before bringing any future motions. When seeking such leave, the defendants shall file proof that it has paid the costs ordered by Justice Bloom and the costs ordered on this motion.
[15] I will return to the significance of this direction below.
c) The Appeals and Motions Since Price J.’s Decision
[16] The Defendants have filed the following appeals and/or motions since the decision of Price J.:
a) A motion for leave to appeal the costs decision of Ricchetti J. dated November 2nd, 2016 to the Divisional Court;
b) A motion for leave to appeal the decision of Price J. dated December 6th, 2016 to the Court of Appeal for Ontario;
c) A motion for leave to appeal the September 30th, 2016 decision of Ricchetti J. granting a CPL to the Divisional Court.
d) This motion, for an order setting aside the notice of garnishment that the Plaintiffs have caused to be issued to collect the various costs awards.
[17] I was given to understand that there may be other motions that the Defendants have brought, but those are not directly before me. With this factual background, I will now address each of the motions before me.
The Plaintiff’s Motion
[18] The Plaintiffs assert that the Defendants have brought a series of frivolous motions since Price J. issued his decision on December 6th, 2016. The Plaintiffs also assert that the Defendants did not seek leave to bring any of these motions and, as a result, they are in clear contravention of Price J.’s Order. As a result, the Plaintiffs seek to have the Defendants’ Statement of Defence struck.
[19] I am of the view that the Plaintiff’s motion must be dismissed. My reasons for reaching this conclusion start with a consideration of the Order that Price J. actually made.
[20] In his reasons, Price J. considered making an Order under two different provisions, either section 140 of the Courts of Justice Act or Rule 2.1.02 of the Rules of Civil Procedure.
[21] Section 140 of the Courts of Justice Act provides that a Judge of the Superior Court, on application, may determine that a party has instituted vexatious proceeding, or conducted a proceeding in a vexatious way. In those circumstances, the Judge may issue directions requiring a litigant to obtain leave before taking any further steps, including an appeal of an existing decision. This is a very broad power and severely limits the ability of a litigant to proceed with any type of proceeding.
[22] If such an Order had been issued in this case, then the Plaintiffs’ motion would be supportable. However, such an Order has not been issued in this case (see paragraph 29 and 30 of Price J.’s reasons). Indeed, as Price J. notes, he could not have issued such an Order, as Orders under section 140 must be sought by way of a separate application.
[23] Price J. issued his direction under Rule 2.1.02, which provides a narrower power for the Court to take two steps. First, the Court may stay or dismiss a motion. Second, the Court may then use its powers under Rule 37.16 to limit a party from bringing any further motions within a proceeding.
[24] In this case, Price J. limited the ability of the Defendants to bring additional motions in this proceeding and went on to note (at paragraph 32) that appeals of various Orders are not motions for the purposes of Rule 2.1.02. As a result, it is clear that Price J’s order does not preclude either motions for leave to appeal or appeals themselves.
[25] Counsel for the Plaintiffs argues that a motion for leave to appeal is a motion in this proceeding and, as a result, it is governed by Price J.’s ruling. I disagree. As an example, the motion for leave to appeal to the Court of Appeal is proceeding in a separate Court. It cannot, therefore, be the same proceeding.
[26] I am fortified in this conclusion by the fact that Rules 2.1.02 and 37.16 are designed to be narrower in scope than section 140 of the Courts of Justice Act. As a result, I am of the view that the three motions for leave to appeal are not covered by Price J’s Order.
[27] As a result, the Plaintiffs should not be entitled to an Order striking out the Defendants’ Statement of Defence as the Defendants were not in contravention of Price J.’s Order by bringing their appeals.
The Defendants’ Motion
[28] The Defendants have moved to set aside the garnishment Order in this case. In my view, this motion, as framed by the Defendants would be caught by the Order of Price J. As a result, the Defendants would require leave to bring this motion.
[29] However, in the course of argument, Mr. Daud Khan stated that the relief that the Defendants were seeking was a stay of the enforcement proceedings while they appealed the various Orders described above. Such a stay is not automatic, as the various appeals that the Defendants are bringing require leave before the appeal can be brought (see Rule 63 of the Rules of Civil Procedure).
[30] If I dismiss the Defendants’ motion on the basis that it is incorrectly framed, then there will likely be a further motion by the Defendants asking for a stay in the enforcement of the various costs proceedings pending the outcome of their various appeals. Given that the Defendants’ have outlined the basis for seeking a stay in their materials, the interests of justice would not be served by dismissing the Defendants’ motion based on the fact that it is improperly framed.
[31] This brings me to a consideration of whether a stay should be granted in this case. Livent (Receiver of) v. Deloitte and Touche (2016 ONCA 395) sets out the test for granting a stay pending a leave to appeal application being heard. These factors are:
a) A serious question to be determined.
b) Irreparable harm
c) Balance of convenience
[32] These factors are not watertight compartments, and strong arguments under one factor may counterbalance weaker arguments under another factor.
[33] I start with the serious question to be determined. I note that my comments do not amount to a determination of the merits of any of these leave to appeal applications. However, I note that all of these motions for leave to appeal deal with an appeal from the exercise of judicial discretion. The granting or denying of a CPL is a matter where the Court must exercise its discretion, and where appellate deference will often be given to the Court that heard the motion. The various costs Orders that were granted also involve the exercise of judicial discretion, and will (on appeal) attract even greater deference from the reviewing Court.
[34] In any event, I do not see any clear or obvious errors in any of the decisions that have been made that are under appeal. As a result, I am doubtful that there is a serious issue to be tried on the merits of any of these appeals. As a result, this factor is very weak, and does not favour granting a stay. However, I hasten to add again that I am not reviewing the merits of these appeals.
[35] This brings me to the irreparable harm. I received medical briefs outlining that Ishaq Khan has had medical problems. He relates many of these problems to this litigation. In my view, these medical conditions do not represent irreparable harm that would flow from denying the stay. Instead, they appear to be conditions that are more likely related to the underlying litigation.
[36] I do not see any other irreparable harm that the Defendants would suffer in this case if a stay was not granted. Any damages that are suffered by the Defendants as the Plaintiffs seek to collect their costs awards are monetary in nature. In terms of the CPL Order, I heard nothing that would suggest that the Defendants are seeking to sell the property and are prejudiced by having the CPL remain on the property pending the consideration of their Leave to Appeal application. Finally, although Bloom J. ordered compliance with undertakings, it is only his costs decision that is under appeal. As a result, the irreparable harm factor also does not favour granting a stay.
[37] Given that neither of the first two factors of the test favour granting a stay, it is not strictly necessary to consider the balance of convenience. However, I would note two points about it. First, the harm that will be suffered by the Defendants is simply monetary in nature. Secondly, by bringing all of these motions, the Defendants seem to have embarked on a course of conduct where they are aggressively seeking to re-litigate the issues previously determined by the Court. Indeed, on the materials before me I agree with Price J’s concerns about the Defendants conduct that led him to grant the Order under Rule 2.1.02. Given that conclusion, the balance of convenience favours the Plaintiffs.
[38] In the result, I find that none of the Orders appealed from should be stayed pending the outcome of the appeals.
[39] I note that this decision does not preclude the Defendants from asking for a stay if they are granted leave to appeal.
Disposition and Costs
[40] The motions of both parties are dismissed.
[41] Since success has been divided in this matter, there will be no costs for either party unless there are offers to settle these motions. If either party is relying on an offer to settle, they may file it with the court office within seven (7) days of the release of these reasons. They are to provide a copy to my judicial assistant, Sara Stafford (sara.stafford@ontario.ca). If offers exist, I will then invite the parties to make submissions.
[42] For clarity, the parties are not to make costs submissions if they submit an Offer to Settle until and unless they are invited to do so by me.
LEMAY J
Released: February 8, 2017
CITATION: Son v. Khan, 2017 ONSC 962
COURT FILE NO.: CV-14-4313-00
DATE: 2017 02 08
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
YOUNG-HEW SON and YOUNG SON
Plaintiff
- and -
DAUD AHMAD KHAN, ISAM MUNAJEED, RE/MAX REALTY SPECIALISTS INC., BROKERAGE, FAWAD KHAN AND ISHAW AHMAD KHAN
Defendants
REASONS FOR JUDGMENT
LEMAY J
Released: February 8, 2017