Court File and Parties
COURT FILE NO.: FS-17-133-00 DATE: 2018 12 13 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Gregory Palmer, Applicant AND: Elaine Lumsden, Respondent
BEFORE: Justice G.D. Lemon
COUNSEL: Zarie Lorne, Counsel for the Applicant Jide Oladejo, Counsel for the Respondent
HEARD: November 29, 2018
Endorsement
The Issue
[1] Mr. Palmer moves for an order that the jointly owned home should be listed for sale. He requests an order that both parties confer and agree to a listing agent forthwith. Further, he asks that the home should not be sold below the fair market value set in an appraisal dated April 6, 2018. Finally, he seeks an order that the net proceeds of sale shall be divided equally.
Background
[2] The parties lived together for approximately 10 years, separating September 9, 2013. They have one child, age 14.
[3] There is no dispute that the property is owned jointly. They purchased the property in 2007.
[4] Mr. Palmer says that he contributed to the down payment, home expenses and labour on the property while they resided together.
[5] Ms. Lumsden submits that he has paid little towards the house and nothing since their separation in 2013.
[6] The parties filed affidavits setting out details of their negotiations attempting to settle this issue. Offers to settle are neither relevant nor admissible at this stage. I have ignored those offers.
Authorities
[7] Mr. Palmer relies upon ss. 2 and 3(1) of the Partition Act, R.S.O. 1990, c. P.4. They read, in part:
All joint tenants … [of] any land in Ontario, may be compelled to make or suffer partition or sale of the land, or any part thereof…
(1) Any person interested in land in Ontario … may bring an action or make an application … for the sale thereof under the directions of the court if such sale is considered by the court to be more advantageous to the parties interested.
[8] In Afolabi v. Fala, 2014 ONSC 1713, Emery J. said:
[27] Under the Act, a joint tenant has a prima facie right to an order for the partition or sale of lands held with another joint tenant. The other joint tenant has a corresponding obligation to permit that partition or sale. These have been described in the case law as fundamental rights flowing from the joint tenancy. The court is required to compel such partition or sale if no sufficient reason can be shown why such an order should not be made.
[28] Each case must be considered on its own facts and circumstances. The court must exercise its discretion having regard to those particular facts and circumstances.
[29] The onus to show what circumstances are present in a proceeding that might require the court to exercise its discretion to refuse an application for a partition or sale order rests with the party opposing the application. That party must show the court there is a sufficient reason recognized in law why an order for partition or sale should not be made.
[30] There has been conflict over the years between those cases where the court has made a final order for the sale of property held jointly by spouses before the trial of other family law claims, and those cases holding that an order for partition and sale should not be made until any dispute related to the property has first been determined.
[33] The judicial trend in recent times has been to confine the discretion of the court to refuse an order for the partition or sale of jointly held property to a narrow standard. The Court of Appeal in Latcham v. Latcham confirmed that the proper standard for the exercise of judicial discretion to refuse partition under section 2 of the Partition Act required evidence of malicious, vexatious or oppressive conduct. The court held that this narrow standard for the exercise of discretion flowed from a joint owners’ prima facie right to partition.
[34] In Bailey v. Rhoden, it was held that the court could refuse partition and sale if it were shown that the sale would cause such hardship to the joint tenant resisting the application that the hardship amounted to oppression.
Analysis
[9] In order to be successful on this motion, Ms. Lumsden needs to show evidence of malicious, vexatious or oppressive conduct. In my view, she has done so. The hardship occasioned by the sale of the home would amount to oppression.
[10] Ms. Lumsden pleads that Mr. Palmer has not contributed to the home. On this record, I cannot make a determination as to who has contributed what to the home. Ms. Lumsden agrees that Mr. Palmer had done some painting on the house, built a shed, maintained the grass and snow and refinished the floor in one room. While she complains that Mr. Palmer has not produced sufficient documentation with respect to his contribution to the home, that is but one important area of evidence. Both parties will also need to testify on this issue. I cannot make a determination of credibility on this record.
[11] However, there is no certainty that the proceeds will be divided equally. From what I have, it does not appear that this will be the case.
[12] Mr. Palmer acknowledges that he is in arrears of support and that those arrears can be paid from the proceeds of sale. Those arrears appear to be more than $10,000 at present.
[13] Ms. Lumsden says that Mr. Palmer has paid nothing on the house since separation in 2013. Mr. Palmer acknowledges that, at least, he has not paid towards the joint mortgage since 2015. Either way, he will need to account.
[14] There is an untested appraisal in the materials suggesting that the house is worth $620,000. Both parties have filed Financial Statements that list the house as worth approximately $600,000. They agree on an outstanding mortgage of approximately $270,000. While there is no certainty in these figures or the net proceeds, I cannot rule out that Ms. Lumsden may be able to pay Mr. Palmer his share without selling the property.
[15] I agree with Ms. Lumsden that it would be unfortunate for their 14-year-old son to move from his present residence. If there was a certainty that the house would be sold in any event, that factor would have little weight in my analysis. However, the proceeds of any sale will likely be held pending the outcome of the trial. It would be oppressive for the house to be sold and find that, in the end result, such a sale was unnecessary.
[16] The requested order will only lead to more delay as the parties attempt to agree on a listing agent and a price. That will not assist them. As set out below, steps can be taken to reduce delay on this file.
[17] On this record, I find that a sale would cause hardship amounting to oppression. The requested motion is dismissed.
[18] Both parties suggest that the other has delayed the proceeding. It appears from the record that both are to blame.
[19] A case conference was held February 23, 2018. On March 27, 2018, a consent order dealt with obtaining an appraisal of the property and production of relevant documents. All of that disclosure was to be completed by April 27, 2018. Other than this motion, nothing seems to have moved the file forward since that time. No settlement conference has been arranged. The parties have not advised me of any reasons for that delay.
[20] The only issue between the parties is the resolution of their interest in the house. Productions should have been completed as ordered and there has been a great deal of negotiation. Accordingly, it is appropriate that a joint settlement conference/trial management conference be arranged in the immediate future. That way, a trial can likely be heard in 2019 and the parties can move on with their lives.
[21] Both counsel shall confer with the trial coordinator’s office to arrange such a date at their earliest opportunity. In any event, that date shall be determined and fixed within the next 30 days.
[22] There seemed to be some suggestion by Ms. Lumsden’s counsel that a motion for summary judgment might be undertaken. On this record, that seems unlikely to succeed. However, there may be other evidence on which to bring such a motion. If so, that motion shall be delivered within 45 days so as not to delay the path to a trial if the motion is unsuccessful.
Result
[23] Accordingly, I order as follows:
- The motion for sale is dismissed.
- A joint settlement conference/trial management conference shall be arranged in the immediate future. Both counsel shall confer with the trial coordinator’s office to arrange such a date at their earliest opportunity. In any event, that date shall be determined and fixed within 30 days of this order.
- Any motion for summary judgment shall be brought within 45 days so as not to delay the path to trial if the motion is unsuccessful.
Costs
[24] If costs cannot be agreed upon, Ms. Lumsden shall provide her costs submissions within the next 30 days. Mr. Palmer shall provide his response within 15 days thereafter. No reply submissions shall be filed unless I request them.
[25] Each submission shall be no more than three pages, not including any Bills of Costs or Offers to Settle.
[26] Written submissions shall be forwarded to me at my office at the Superior Court Office, 74 Woolwich Street, Guelph, Ontario, N1H 3T9. I shall ensure that they are filed in Brampton when I have finished with them.
Lemon J. Date: December 13, 2018