NEWMARKET COURT FILE NO.: CV-14-121033-00 DATE: 20190108 CORRIGENDA: 20190110 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: 1757419 Ontario Ltd., Plaintiff AND: Argo Property Management Ltd. and York Region Condominium Corporation No. 611, Defendants

BEFORE: The Honourable Mr. Justice C.F. de Sa

COUNSEL: Antoni Casalinuovo, Counsel for the Plaintiff Megan Hodges, Counsel for the Defendants

HEARD: October 17, 2018

RULING ON MOTIONS

Text of original decision has been amended with changes appended.

Overview

[1] The defendants seek to have the action struck. According to the defendants, the plaintiff has had numerous opportunities to submit the matter to arbitration, and has chosen not to do so. The matter dates back to December 2014 and the plaintiff has done nothing to move the matter forward. The plaintiff has even ignored at least two court orders directing that the notice of arbitration be filed within a specified period of time. On this basis alone, the defendants submit the matter should be dismissed with costs.

[2] The plaintiff agrees that the matter should be dismissed, but asks this Court to appoint an arbitrator to deal with the outstanding dispute before dismissing the action. The plaintiff asks this Court to leave the dispute and the issue of costs to the arbitrator.

[3] I agree with the defendants. The action is dismissed. I will not remit the matter for arbitration. My reasons are outlined below.

[4] York Region Condominium Corporation No. 611 (“YRCC 611”) is the condominium corporation for 93 Woodstream Blvd. in Woodbridge, Ontario (the “Property”). Argo Property Management Ltd. (“Argo”) is the property manager for YRCC 611.

[5] The plaintiff corporation 1757419 Ontario Ltd. is the owner of a condominium unit at the Property.

[6] In September 2014, the defendants removed a sign from the plaintiff’s unit because the sign contravened YRCC 611’s Declaration and By-Laws.

[7] In response to the removal of the sign, the plaintiff commenced this action by delivering a Statement of Claim on December 8, 2014, seeking actual damages in the amount of $250,0000 for breach of contract and aggravated and punitive damages in the amount of $25,000. The plaintiff also scheduled an urgent motion for interim relief to be heard December 18, 2014 before Justice Douglas (the “Action”).

[8] The December 18, 2014 motion was opposed by the defendants who took the position that the plaintiff’s complaints were subject to the arbitration provisions of the Condominium Act, 1998, SO 1998, c 19. [1]

[9] The motion was adjourned and an interlocutory order was made on consent pending the hearing of the plaintiff’s motion. The plaintiff never proceeded with the injunction motion.

[10] In November 2015, the defendants brought a motion for an order staying this action and for the parties to proceed by way of mediation or arbitration. Justice Vallee ordered the plaintiff to commence arbitration proceedings by December 14, 2015.

[11] Having not heard back from the plaintiff, the defendants again brought a motion to stay or dismiss the action based on the plaintiff’s failure to comply with the order of Justice Vallee. Three days prior to the scheduled motion date, the plaintiff sought an adjournment due to a “previously scheduled court trial”. Justice Quinlan adjourned the motion but ordered the plaintiff to comply with the order of Justice Vallee within 15 days.

[12] On April 13, 2017, the defendants brought a third motion before Justice Bird to dismiss the action based on the plaintiff’s failure to comply with the orders of Justice Vallee and Justice Quinlan. The parties consented to an order that the action would be stayed, the plaintiff would pay the defendants $1,000 in costs, and the plaintiff would commence arbitration proceedings within 30 days.

[13] Once again, the plaintiff failed to commence arbitration proceedings as required by the orders of Justice Vallee, Justice Quinlan, and Justice Bird. The plaintiff also stopped responding to the defendants’ attempts to communicate.

[14] In December 2017, the defendants brought the motion herein seeking a dismissal of the action. On February 1, 2018, the plaintiff finally paid the outstanding $1,000 cost award to the defendants. On or about April 6, 2018, the plaintiff finally delivered its Notice to Arbitrate.

Analysis

[15] The parties agree that the matter should have been remitted to arbitration as per the terms of the Condominium Act. The Superior Court of Justice is not the appropriate forum for this dispute: Subsection 132(4) of the Condominium Act. McKinstry v. York Condo Corp. No. 472, 2003 CarswellOnt 4948, [2003] O.J. No. 5006, at paras. 19, 20 and 22.

[16] Accordingly, the only real question is whether the action should be dismissed outright, or whether the issues raised in the action should be remitted to arbitration and an arbitrator appointed.

[17] The defendants take the position that referring the matter to arbitration at this point would render the relevant sections of the Arbitration Act, 1991, SO 1991, c 17 and the Limitations Act, 2002, SO 2002, c 24, Sch B, meaningless and would have the effect of allowing a court to indefinitely extend a limitation period expressly set forth in the Limitations Act: A.G. Clark Holdings Ltd. v. HOOPP Realty Inc., 2014 ABCA 20, 2014 CarswellAlta 20, at paras. 7 and 8 [A.G. Clark Holdings]; Babcock & Wilcox Canada Ltd. V. Agrium Inc., 2005 ABCA 82, at paras. 11, 12.

[18] I agree with the defendants. In my view, it would be inappropriate to refer the matter to arbitration. The plaintiff’s choice to wilfully ignore court orders directing it to move the matter forward to arbitration should not be countenanced by the appointment of an arbitrator at this stage.

[19] Even if there were disagreements regarding the appointment of a specific arbitrator, the plaintiff could have easily brought a motion to appoint an arbitrator on any of the earlier appearances if it was serious about proceeding with this matter. On the record before me, it is evident that the plaintiff had no real interest in having the matter adjudicated on its merits.

[20] Indeed, this matter has been outstanding and on the defendants’ books since 2014. The plaintiff has done nothing to move the matter forward, and has repeatedly resisted the defendants’ efforts to advance the matter and ignored specific court orders to have the matter referred to arbitration.

[21] A court may make an order striking an arbitration proceeding on the basis that there are no claims to arbitrate where the claims sought to be arbitrated expired as being brought outside of the applicable limitation periods. Bell Canada v. Plan Group Inc., 2012 ONSC 42, 2012 CarswellOnt 248, at para. 60. In my view, given the plaintiff’s conduct, such an order is warranted here.

[22] Accordingly, the action is dismissed.

Costs for the Action

[23] Under section 131 of the Courts of Justice Act, RSO 1990, c C.43, the costs of and incidental to a proceeding or a step in a proceeding are in the discretion of the court, and the court may determine by whom and to what extent the costs shall be paid.

[24] Nothing in Rules 57.02 to 57.07 of the Rules of Civil Procedure, RRO 1990, Reg. 194, affects the authority of the court under section 131 of the Courts of Justice Act to award all or part of the costs on a substantial indemnity basis. In exercising discretion as to an appropriate costs award, the court may take into account "the conduct of any party that tended to shorten or lengthen unnecessarily the duration of the proceeding" and "whether any step in the proceeding was improper, vexatious or unnecessary".

[25] Cost awards on a substantial indemnity basis are appropriate “where one party to the litigation has behaved in an abusive manner […] and unnecessarily run up the costs of the litigation.” Standard Life Assurance Co. v. Elliot, 2007 CarswellOnt 3236, [2007] O.J. 2031, para. 9.

[26] I agree with the defendants that costs should be awarded to the defendants for the action on a substantial indemnity basis. The plaintiff brought its claim in the wrong forum, and despite repeated requests, and orders by the court, neglected or refused to rectify the issue.

[27] Accordingly, costs are awarded to the defendants on a substantial indemnity basis. I leave it to the parties to sort out the exact amount, and if they cannot do so, I will accept submissions on the issue.

Cross-Motion to Strike portions of the Status Certificate

[28] The plaintiff has brought a cross-motion to have portions of its Status Certificate struck. More specifically, the plaintiff is seeking an order that the defendants remove the notation of the back charge from paragraph 5 of YRCC 611’s Status Certificate referencing the legal costs associated with this action.

[29] The courts have held that the magnitude of disclosure in a status certificate is to ensure that prospective buyers have enough information to assist them in making an informed purchase.

[30] The Status Certificate is a prescribed form and must contain information about YRCC 611 as a whole. A Status Certificate binds YRCC 611 and it is prohibited from making statements which are inaccurate or amount to misrepresentation: Trez v Wynford, 2015 ONSC 2794.

[31] In this case, the plaintiff does not dispute that YRCC 611 can state that it is involved in litigation on the Status Certificate. However, the plaintiff takes the position that YRCC 611 has no authority except by way of an order from this court to include a statement in the Status Certificate back-charging the YRCC 611’s legal costs incurred for this proceeding until the merits of the dispute have been decided.

[32] The legal matters which were previously outstanding are now complete. I leave it to the parties to sort out any remaining issues with respect to the Status Certificate.

Disposition

[33] For the reasons set out above, the Statement of Claim is struck, the action is dismissed with costs payable to the defendants on a substantial indemnity basis and the Notice to Arbitrate is struck as being outside the two year limitation period.

[34] If the parties are unable to sort out the exact amount, I will accept submissions on the issue. The defendants to file their submission for costs within 14 days from the date of this decision and the plaintiff to file their submission for costs 7 days thereafter. Submissions are to be no more than 2 pages in length.

Justice C.F. de Sa Date: January 8, 2019

Amendments

1. Paragraph 34: The second sentence is amended from: “ The plaintiff to file its submission for costs within 14 days from the date of this decision and the defendants to file their submission for costs 7 days thereafter.” To read: “ The defendants to file their submission for costs within 14 days from the date of this decision and the plaintiff to file their submission for costs 7 days thereafter”.

[1] The defendants have not delivered a Statement of Defence on the basis that the subject matter of the within proceedings is not properly brought before the Superior Court of Justice.