Khan v. Khan, 2019 ONSC 4687

COURT FILE NO.: FC-18-56883

DATE: 20190807

ONTARIO

SUPERIOR COURT OF JUSTICE

FAMILY COURT

BETWEEN:

Qaisar Khan

Applicant

– and –

Rehana Qaisar Khan

Respondent

Qaisar Khan, Self-Represented

Saidaltaf Patel, for the Respondent

HEARD: July 24, 2019

REASONS FOR DECISION

CHARNEY J.:

Introduction

1The Applicant, Qaisar Khan, brings this motion for an order for the sale of the matrimonial home in Markham, Ontario, and for the Respondent, Rehana Qaisar Khan, to pay occupational rent, as well as assorted other relief.

2The Respondent has brought a cross-motion for exclusive possession of the matrimonial home, and an order that the matrimonial home be transferred to the parties’ son, Farhan Khan, for $625,000 to be paid within 90 days.

Background Facts

3The parties were married in Pakistan on July 8, 1976, and immigrated to Canada in 2001. They moved into the matrimonial home in 2003, but have lived apart for most of their marriage since the Applicant worked in the oil industry in Calgary and Japan. The home is registered in both of their names. They have two adult children.

4There is a dispute as to the date that the parties separated. The Applicant claims that the date of separation was January 1, 2010, the Respondent claims that they did not separate until May 11, 2018. Since the couple has not lived together for more than a few weeks of any year since they came to Canada, this dispute may prove difficult to resolve.

5The Applicant is now 67 years of age, and has not worked since 2013. He lives primarily in Pakistan, but resides in the matrimonial home when he visits Ontario.

6There are numerous other disputes that will have to be resolved before equalization can be settled. For example, the Respondent claims that the Applicant owns property in Pakistan. The Applicant, however, claims that the property was given as a gift to their son in 2009. The son claims that he is holding the property in trust for his father.

7The Respondent opposes the sale of the matrimonial home. She states that she lives in the home with her daughter and son, as well as her son’s wife and six children. The children all attend the local school, and this is where the family’s friends all live. She alleges that she and her family will suffer hardship if she is forced out of the home. Given the dispute regarding the value of the Applicant’s assets, the Respondent takes the position that the Applicant would not be entitled to 50% of the sale of the matrimonial home in any event.

Legislative Framework

8Section 2 of the Partition Act, R.S.O. 1990, c. P.4 empowers the court to order the sale of a jointly owned home, including a matrimonial home:

2. All joint tenants, tenants in common, and coparceners, all doweresses, and parties entitled to dower, tenants by the curtesy, mortgagees or other creditors having liens on, and all parties interested in, to or out of, any land in Ontario, may be compelled to make or suffer partition or sale of the land, or any part thereof, whether the estate is legal and equitable or equitable only.

9In addition, sections 23 and 24 of the Family Law Act, R.S.O. 1990, c. F.3 (FLA) deal specifically with the court’s powers regarding the sale, possession and exclusive possession of a matrimonial home:

23. The court may, on the application of a spouse or person having an interest in property, by order,

(a) determine whether or not the property is a matrimonial home and, if so, its extent;

(b) authorize the disposition or encumbrance of the matrimonial home if the court finds that the spouse whose consent is required,

(i) cannot be found or is not available,

(ii) is not capable of giving or withholding consent, or

(iii) is unreasonably withholding consent,

subject to any conditions, including provision of other comparable accommodation or payment in place of it, that the court considers appropriate;

(c) dispense with a notice required to be given under section 22;

(d) direct the setting aside of a transaction disposing of or encumbering an interest in the matrimonial home contrary to subsection 21(1) and the revesting of the interest or any part of it on the conditions that the court considers appropriate; and

(e) cancel a designation made under section 20 if the property is not a matrimonial home.

Order for possession of matrimonial home

24. (1) Regardless of the ownership of a matrimonial home and its contents, and despite section 19 (spouse’s right of possession), the court may on application, by order,

(a) provide for the delivering up, safekeeping and preservation of the matrimonial home and its contents;

(b) direct that one spouse be given exclusive possession of the matrimonial home or part of it for the period that the court directs and release other property that is a matrimonial home from the application of this Part;

(c) direct a spouse to whom exclusive possession of the matrimonial home is given to make periodic payments to the other spouse;

(d) direct that the contents of the matrimonial home, or any part of them,

(i) remain in the home for the use of the spouse given possession, or

(ii) be removed from the home for the use of a spouse or child;

(e) order a spouse to pay for all or part of the repair and maintenance of the matrimonial home and of other liabilities arising in respect of it, or to make periodic payments to the other spouse for those purposes;

(f) authorize the disposition or encumbrance of a spouse’s interest in the matrimonial home, subject to the other spouse’s right of exclusive possession as ordered; and

(g) where a false statement is made under subsection 21(3), direct,

(i) the person who made the false statement, or

(ii) a person who knew at the time he or she acquired an interest in the property that the statement was false and afterwards conveyed the interest,

to substitute other real property for the matrimonial home, or direct the person to set aside money or security to stand in place of it, subject to any conditions that the court considers appropriate.

Order for exclusive possession: criteria

(3) In determining whether to make an order for exclusive possession, the court shall consider,

(a) the best interests of the children affected;

(b) any existing orders under Part I (Family Property) and any existing support orders or other enforceable support obligations;

(c) the financial position of both spouses;

(d) any written agreement between the parties;

(e) the availability of other suitable and affordable accommodation; and

(f) any violence committed by a spouse against the other spouse or the children.

Best interests of child

(4) In determining the best interests of a child, the court shall consider,

(a) the possible disruptive effects on the child of a move to other accommodation; and

(b) the child’s views and preferences, if they can reasonably be ascertained.

Analysis

(i) Sale of the Matrimonial Home and Exclusive Possession

10The relevant provisions of the Partition Act and the FLA must be read together. Where substantial rights in relation to jointly owned property are likely to be jeopardized by an order for sale, the matter should be deferred until the issues are decided under the FLA. However, if the sale will not prejudice either spouse’s claim with respect to the home under the FLA, there is no reason to delay a sale: Silva v. Silva, 1990 6718 (ON CA); 1 O.R. (3d) 436: 75 D.L.R. (4th) 415.

11An owner of a home has a prima facie right to sale: Davis v. Davis, 1953 148 (ON CA), [1954] O.R. 23 (C.A.); Brienza v. Brienza, 2014 ONSC 6942, at para. 22. A matrimonial home may be sold without spousal consent when the evidence does not support a realistic need to maintain the house as a home for the benefit or stability of the children pending trial: Jiang v. Zeng, 2019 ONSC 1457, at paras. 50 and 51.

12In Jiang McGee J. stated, at paras. 36 - 38:

Exclusive possession is an Order only available pending the sale of a matrimonial home. An Order for exclusive possession cannot be used to frustrate an owner’s prima facie right to the sale of the home. The sale of the matrimonial home can be ordered prior to Trial on a motion, or at Trial.

The sale of a matrimonial home will generally be ordered on a motion unless there are children residing in the home, per section 24(3)(a) of the Family Law Act, or, an entitlement under the Act that would be otherwise defeated.

The purpose of section 24(3) is to preserve stability and continuity in the lives of children while their parents’ legal issues are determined.

13In the present case, the Respondent is not really seeking exclusive possession pending the sale of the matrimonial home. She already has what amounts to exclusive possession because the Applicant lives in Pakistan, and only came to Ontario so he could argue this motion. He is staying at the matrimonial home while visiting in Ontario, but the Respondent has raised no objection to this temporary arrangement. The Respondent’s motion for exclusive possession is really a motion that the home not be sold at all.

14The Respondent has not persuaded me that Applicant’s prima facie right to have the house sold should be defeated in these circumstances. Even assuming that the Respondent’s claimed date of separation is accepted, the parties have been separated for more than one year. Their children are both adults. The adult children cannot defeat their father’s right to have the house sold because they want to continue to have a free place to live.

15Even assuming that s. 24(3) of the FLA extends to the best interests of the grandchildren, there is no evidence as to why this particular house is necessary for the grandchildren’s best interests, or why the adult children are unable to find alternate accommodation for their families.

16While there are issues as to the parties’ respective entitlements to the net proceeds of any sale of the property, these issues will be determined at trial. I am not satisfied that the interim housing needs of the Respondent and her adult children must prevent the house from being sold until after the trial. If the proceeds of sale are held in trust, the proposed sale will not prejudice the rights of either spouse under the FLA. Indeed, the sale may encourage settlement because the parties will know the actual value of this asset and will want to access the funds held in trust.

17The Respondent has not established a reasonable need to delay the sale of the home. As Moore J. stated in Goodman v. Goodman, 2014 ONSC 3466, at para. 35:

Delaying the sale until the time of trial simply adds time to the process of translating the asset into a fund to be allocated between the parties according to their interests on proper evidence at trial. I am satisfied that the house should be sold and the proceeds of the sale should be maintained in trust pending agreement between the parties as to allocation between the parties or further order of the court.

(ii) Transfer of the Home to the Parties’ Son

18The Respondent also seeks an order that the matrimonial home be transferred to the parties’ son, Farhan Khan, for $625,000 to be paid within 90 days.

19The court does not have the authority to grant a spouse the right to purchase the other’s interest in the matrimonial home or the right of first refusal: Martin v. Martin, 1992 7402 (ON CA), [1992] 8 O.R. (3d) 41.

20In Brienza, Perell J. summarized the law at paras. 37 and 38:

The court does not have the jurisdiction to compel one co-owner to sell to the other, although the co-owners may participate in the court-ordered sale of the property in the open market; Osborne v. Myette, [2004] O.J. No. 3383 (S.C.J.); Legg v. Draper-Legg, [2004] O.J. No. 606 (S.C.J.); Greenbanktree Power Corp. v. Coinamatic Canada Inc., supra.

The court does not have the jurisdiction under the Partition Act to grant a right of first refusal to either co-owner: Dibattista v. Menecola (1990), 1990 6888 (ON CA), 75 O.R. (2d) 443 (C.A.). In Silva, supra, the court noted that where a sale is ordered, the respondent may bid in the sale. See also: Glick v. Carr, [1991] O.J. No. 1588 (Gen. Div.).

21See also: Buttar v. Buttar, 2013 ONCA 517, at para. 64: “This court has jealously guarded the rights of joint owners to the best price for jointly-owned property”; Laurignano v. Laurignano, 2009 ONCA 241, at para. 3; Watson v. Watson, 2015 ONSC 2091, at paras. 34-37; McColl v. McColl, 1995 7343 (ON SC), at para. 29; and Kokaliaris v. Palantzas, 2016 ONSC 198, at para. 44.

22Once the property is listed for sale, Farhan Khan will be free to bid on the property along with all other potential buyers.

Conclusion

23This Court Orders:

a. The matrimonial home located at 35 Isabella Street, Markham, Ontario, L3R 5S3, will be listed for sale within 40 days of the date of this Order.

b. A listing agreement shall be entered into no later than 30 days from the date of this Order. The parties shall fully cooperate with the listing agent.

c. Either party is at liberty to bid on the property once it is listed for sale.

d. The whole of the sale proceeds, but for any outstanding mortgages, realty taxes, real estate legal fees, realtor commission and sale adjustments shall be held in trust by the real estate lawyer, pending further order of the court or agreement of the parties.

Costs

24If the parties are not able to agree on costs, the Applicant may file costs submissions of no more than 3 pages, plus costs outline and any offers to settle within 30 days of the date of this Order, and the Respondent may file reply submissions on the same terms within 20 days thereafter.