Court File and Parties

COURT FILE NO.: CV-20-561227 DATE: 20200602 SUPERIOR COURT OF JUSTICE - ONTARIO

B E T W E E N:

BOBBIE MANN, Plaintiff

– and –

MARCUS CHAC-WEI et al., Defendants

BEFORE: F.L. Myers J.

COUNSEL: Micheal Simaan and Gwendolyn L. Adrian, for the Plaintiff Rolf M. Piehler, for the Defendant

READ: June 1. 2020

Endorsement

This Motion in Writing

[1] The plaintiff moves to enforce a settlement agreement. The defendants say that the motion is premature as they are not in breach of the agreement.

Short Motions in Writing under the Toronto Region Notice to the Profession

[2] This is the first motion in writing read under the provisions of Part C.1(4) of the Toronto Region Notice to the Profession dated May 13, 2020. The procedure requires parties who seek to bring a short, opposed motion or application to file a Short Motion or Application Request Form that is embedded in the Notice to the Profession on the court’s website.

[3] The Short Motion or Application Request Form provides the court with information concerning the proposed motion or application and the context within the larger proceeding (if any). Counsel are urged to fill-in the form completely in consultation with the other counsel on the proposed motion or application.

[4] The Notice to the Profession provides that short motions and applications will be heard in writing unless the triage or hearing judge orders otherwise. The Short Motion or Application Request Form repeats this direction but allows counsel and parties to provide reasons in support of requests for other hearing formats. The most likely alternative is a case conference if the triage judge is of the view that progress may be made - or the motion avoided altogether - by a less formal hearing format. No remote, oral hearings have been scheduled as yet in this Short Motion or Application process.

[5] The Short Motion or Application Request Form requires counsel to communicate in advance to agree on a schedule for the exchange of materials in support of the proposed motion or application. Counsel are expected and required to cooperate on procedural matters to ensure that all parties receive a fair hearing in court. (See Commentary 1 under Rule 5.1-1 of the Law Society of Ontario’s Rules of Professional Conduct). The dispute is between the clients; not counsel. The Short Motion or Application Request Form provides a place for moving counsel to report the schedule agreed upon by all parties and, if none is agreed, the reason why this happened. Costs are an issue where parties do not cooperate on scheduling and such procedural matters.

[6] The triage judge will provide a form of endorsement that contains directions for the holding of a written (or other) hearing. The form of triage directions provides a schedule for the exchange of materials and requires that counsel and the parties provide their material to the court in two separate ways:

a. Material must be filed with the Civil Intake branch of the court at a specific generic email address that is provided in Schedule “A” to the triage judge’s directions.

b. In addition, counsel and the parties are required to upload their material to a folder that they create on Sync.com.

[7] The use of two distinct filing processes during this pandemic fulfills two separate purposes. The filing with the Civil Intake branch is necessary to ensure that the court receives and stores all the proper material. The creation of the Sync.com folder ensures that the judge receives material in a manner that is organized and user-friendly. This avoids the inefficiencies that would result from sifting through large numbers of undifferentiated emails for each of several motions in a sitting day, to search manually for unlisted attachments, prepared in all manner of different formats, with no consistent naming convention. It is not an exaggeration to say that searching for and organizing material provided in a series of email attachments over a number of weeks, for each motion on a day’s list, can take as long or longer than reading the motion itself.

[8] Therefore, although the court requires documents by email for filing for now, the court also requires parties to organize their materials for the hearing in a Sync.com folder.

[9] There is to be one Sync.com folder per motion or application. The party responsible to prepare the folder will be named in the triage judge’s directions. Counsel can expect to aid parties opposite to access and upload their material to the folder that they create especially if any party is self-represented.

[10] Each folder on Sync.com is to contain a separate sub-folder to house the materials of each participating party. Each document filed is to be named in accordance with naming rules that are also set out in the triage judge’s directions. The naming rules let the judge and all parties know what each document is without the need to open it.

[11] The parties send the link to the Sync.com folder to the court with their Motion Confirmation Forms one week before the motion is scheduled to be read. The email address for sending Motion Confirmation Forms with the Sync.com link is also in the triage judge’s directions.

[12] In this case, I received a hyperlink from the Motions Coordinator. It took me to a folder created by the plaintiff’s counsel on Sync.com. The folder contained a sub-folder named “Plaintiff” and a sub-folder named “Defendant”. In each was the evidence, factum, and costs outline of each party named under the standardized naming protocol so I could tell right away what each document was.

[13] I am appreciative of counsels’ efforts and cooperation in preparing easily accessible material for the court at a time when the court is under severe personnel limitations due to the pandemic.

The Motion

[14] During a pre-trial conference on November 13 2019, the parties settled the litigation. Both sides agree that the case has settled and that the settlement agreement is binding.

[15] Para. 1 of the settlement agreement provides that the defendants shall pay the plaintiff $200,000 in full and final settlement of the proceeding. There is no date upon which this payment was said to be due. Moreover, the parties acknowledge that it was understood that the defendants would be raising the funds for the settlement by refinancing their home. However, the payment obligation in para. 1 of the agreement is not expressly conditional on that happening. However, implicitly, the parties must be taken to have known and expected that this would take some time.

[16] Para. 3 of the settlement agreement provides for the parties to exchange releases. Para. 4 provides for the plaintiff to release its CPL over the defendants’ house when the $200,000 payment is made. This supports the expectation that the settlement funds were to come from the proceeds of refinancing of the house.

[17] The plaintiff complains that she has had to drag the defendants through compliance with each term of the settlement as agreed. The correspondence among counsel bears this out. The defendants have not implemented the settlement terms proactively and their counsel has not responded to correspondence with alacrity.

[18] But none of that really matters. The issue on the motion is whether the defendants’ failure to pay the $200,000 to date amounts to a failure to comply with the terms of the settlement agreement so that the court should grant judgment in those terms under Rule 49.09 of the Rules of Civil Procedure, RRO 990, Reg. 194.

[19] The defendants argue that they have been trying to refinance assiduously since November. It has taken longer than they had expected or hoped. They argue that this motion is “pre-mature as they have acted diligently and in good faith in attempting to secure re-financing.” The defendants argue that they have not failed to perform their part of the bargain.

[20] The defendants’ evidence is that they have incurred a number of setbacks in their efforts to refinance. They say that their first mortgagee took power of sale proceedings. Their real estate lawyer made a conveyancing error and was then disbarred. Their second mortgagee paid out the first mortgagee and now seeks exorbitant fees and has not provided a discharge statement on a timely basis. They also say that the plaintiff has not followed-up on the status of the refinancing or provided its own release as yet either.

[21] The latter points are incorrect. The plaintiff’s lawyer requested information about the status of the refinancing on December 4 and 5, 2019 and February 18, 2020. The defendants did not respond. Moreover, counsel agreed that each would obtain their client’s signed counterpart of the release and hold it in escrow until payment. The plaintiff’s counsel has confirmed that she has her client’s release in escrow. The defendants’ counsel has not.

[22] In her February 18, 2020 letter, counsel for the plaintiff put the defendants on notice that the failure to pay was a violation of the settlement agreement. Three more months have passed.

Analysis

[23] The issue is whether six months is a reasonable time for the defendants to pay the proceeds as agreed. One could spend a fair amount of time debating whether the settlement agreement is conditional on the refinancing of the defendants’ property. As I noted above, the obligation to pay is expressed unconditionally. But the parties understood that the funds were to come from a refinancing. In my view, the question does not have to be answered to resolve this motion. Whether the defendants are obligated to pay unconditionally or to do so once they refinance, in either case more than a reasonable amount of time has passed.

[24] Where a party agrees to pay on the happening of an event, the timing of which he or she controls, the court will imply that the event and payment will occur within a reasonable time. See: Ring Contracting v. Aecon Construction Group Ltd., 2006 BCCA 304.

[25] The defendants do not say that they cannot refinance. They complain, probably quite fairly, that the face disadvantageous conditions to refinancing. But they did not bargain for the right to pay only when they get the best refinancing terms that they can possibly get in their sole discretion at a timing of their choosing. They agreed to refinance and pay the plaintiff in a reasonable time. They have adduced no evidence of being refused refinancing by third party lenders or even looking at competitive lenders. The court can take notice of the fact that there is a competitive market of banks, credit unions, other financial institutions, and private mortgage lenders all competing in the Toronto residential mortgages market.

[26] The defendants argue that their first and second mortgagees have been very aggressive and difficult with them. Accepting that, they have had more than half a year to scour the home mortgage market to make their best deal. The plaintiff has waited a reasonable time as she implicitly agreed.

[27] Accordingly, in my view, the defendants have failed to comply with the terms of the settlement agreement by failing to refinance and pay within a reasonable time. Accordingly, order to go in accordance with para. 1 of the settlement agreement.

[28] I decline to order prejudgment interest. Although included in the plaintiff’s draft order, the amount would be immaterial and there was no evidence or argument on quantum or timing.

Costs

[29] The plaintiff seeks costs of approximately $7,400 for this motion on a partial indemnity basis. I am satisfied that the hourly rate and hours billed by counsel were reasonable. There is no reason to depart from the normative approach that costs follow the event. The defendants therefore shall pay the plaintiff costs of this motion on a partial indemnity basis of $7,400 inclusive of taxes and disbursements. I have considered the plaintiff’s offer to settle dated March 26, 2020. In my view, in the exercise of my discretion under Rule 49.13, the offer to reduce costs but not principal does not reflect a reasonable compromise designed to encourage settlement negotiations. I would not award enhanced costs of the motion based on an offer with a practically meaningless costs reduction.

F.L. Myers J. Date: June 2, 2020