Court File and Parties

COURT FILE NO.: CV-20-637239 DATE: 20200323 ONTARIO SUPERIOR COURT OF JUSTICE

B E T W E E N:

CHU RESTO YS INC., Applicant

– and –

GREENTOWER SERVICE INC., Respondent

BEFORE: F.L. Myers J.

COUNSEL: Rann Wang, for the Applicant Ang Li, for the Respondent

HEARD: March 20, 2020

Endorsement

The Background

[1] The applicant runs a restaurant at premises leased from the respondent. In late February, 2020, the respondent landlord purported to terminate the lease. It re-entered the premises and evicted the applicant. The landlord alleges that the applicant breached the lease by making improper renovations and refusing to restore the premises despite multiple demands and notices. The applicant tenant denies the allegations and, among other things, argues that the landlord is acting in bad faith to punish the tenant as a result of a failed investment they made together earlier in 2019.

[2] As soon as the respondent re-entered the premises, the applicant moved for an interlocutory injunction prohibiting the landlord from terminating the lease. Archibald J. heard counsel in Civil Practice Court on March 6, 2020 and scheduled the hearing of the injunction motion for March 26, 2020. The evidence requires translation and therefore this motion takes somewhat longer to prepare than its urgency might otherwise suggest.

The Effect of the COVID-19 Pandemic

[3] On March 15, 2020 the Chief Justice released a Notice to the Profession advising that as a result of the global COVID-19 pandemic, the court had adjourned all scheduled civil hearings. The Notice to the Profession allows for the hearing of matters deemed urgent and scheduled by a triage judge.

[4] Counsel for the parties discussed the manner of proceeding in light of the adjournment of the injunction motion. The applicant determined that the respondent appeared to be showing the premises and asked the landlord to confirm that it would not alter the status quo by re-letting the premises pending the re-scheduling and return of the injunction motion. The landlord invited the tenant to remove its inventory from the premises and declined to give an open-ended undertaking to maintain the status quo. The applicant therefore sought to bring an urgent motion under the Notice to the Profession for an interim injunction requiring the landlord to maintain the status quo pending the re-scheduling of its injunction motion.

[5] Rather than scheduling a motion, the court convened a case conference with counsel by telephone very shortly after receiving the applicant’s request for an urgent hearing. The purpose of the case conference was to seek an immediate, consensual, interim resolution focusing on the need for cooperation during these emergency times.

[6] In discussions with counsel, Mr. Li indicated that the landlord was prepared to undertake to maintain the status quo provided that there was a schedule for the injunction motion with a certain hearing date so that the landlord was not agreeing to an indeterminate delay.

[7] The landlord’s undertaking avoided the need for the court to consider whether to make an urgent interim order or to convene a motion to consider doing so. Now is not the time for unnecessary process.

Re-Scheduling the Hearing

[8] The landlord intends to commence a counter-application under Part III of the Commercial Tenancies Act, RSO 1990, c L.7, for an order confirming the termination of the lease. The tenant’s claim for relief from forfeiture is made under s.20 in Part I of the statute. Under s.20, the applicant is entitled to claim an interim or interlocutory injunction. But it can also bring on the merits in a summary process. The applicant says it wishes to defer the resolution of the merits to a later hearing as it may need expert evidence. The landlord, by contrast, intends to adduce expert evidence at the first hearing to support its counter-application.

[9] The parties have had a considerable time to retain any needed experts. This proceeding did not arise on the sudden. If the tenant has been asserting its entitlement to make whatever modification to the premises it has made, it must have some basis for taking that position if it is proceeding in good faith.

[10] The judge who hears the application and counter-application will determine how they proceed. As set out below, she may convene one or more case conferences if she is so advised. At this point, I note simply that if the applicant chooses not to answer the landlord’s counter-application on the merits, it does so at its own risk.

[11] The landlord also raises a question as to whether the parties’ lease requires that the issues between them be resolved by private arbitration. That would be an alternative that is inconsistent with its proposed counter-application under Part III of the statute. Whether the landlord is required to elect as between two inconsistent alternatives and, in any event, whether it has grounds to stay this proceeding under s.7 of the Arbitration Act, 1991, SO 1991, c 17, are also recognized as issues for the hearing.

[12] The landlord shall issue a Notice of Application for its counter-application (if any) and deliver all evidence on which it relies in response to the application and in support of its counter-application by noon on March 27, 2020. The applicant shall deliver all evidence it intends to rely upon in response and reply by April 1, 2020. Cross-examinations with real time or expedited transcripts shall be held on April 6 and 7, 2020 in person or by teleconference as may be agreed by counsel. (This too is a matter requiring cooperation in light of the times.)

[13] Factums will be exchanged and filed by both sides by noon on April 9, 2020.

[14] If the matter does not settle, then as delegate of the Regional Senior Justice, I have designated Justice A. Pollak to hear this proceeding on April 10, 2020 at 10:00 a.m. for up to four hours.

[15] Service of any materials for this application and any counter-application may be made by email and shall be deemed effective on the date the email is sent or, if sent after 4:00 p.m., on the next day. No acknowledgement of receipt for email service is required for these proceedings.

[16] All evidence, motion records, and factums shall be filed with the court by delivering them as attachments to an email to the other party and the Motions Coordinator in searchable PDF format. No Books of Authority or statutory materials are to be sent to the other parties or the Motions Coordinator. References to case law or statutory material shall be made by hyperlinks to contained in the parties’ factums or in a separate list of authorities.

[17] The hearing will be held by telephone case conference to be held on a line arranged by the Motions Coordinator. The parties and the presiding judge may use videoconference technology (whether Skype or Microsoft Teams or otherwise) as may be available to them all and acceptable to the presiding judge.

[18] For as long as the Courthouse remains open to the public or, if it should close, then upon it re-opening, each party shall file with the Civil Motions Office a copy of all the material it delivered electronically for this motion, with proof of service, and pay the appropriate fees therefor.

[19] This endorsement is effective when made. No formal order is required.

[20] The parties are given notice that:

a. The presiding judge may convene one or more case conferences and make all orders as she deems appropriate under Rule 50.13(6) of the Rules of Civil Procedure to ensure the efficient hearing of the urgent applications that are the subject of this endorsement; and

b. Notwithstanding Rule 59.05 of the Rules of Civil Procedure, the outcome of the application, whether conveyed in typed or handwritten format, is an order of the court effective from the date it is made. In accordance with Rules 77.07(6) and 1.04 of the Rules of Civil Procedure, no formal order need be entered and filed unless an appeal or a motion for leave to appeal is brought to an appellate court.

c. All of the provisions of this order may be varied by the presiding judge on such terms as she deems just; and

d. The hearing may be recorded for the court’s purposes.

F.L. Myers J. Date: March 23, 2020