Court File and Parties
Court File No.: CV-20-637134 Motion Heard: 2020-09-30 Superior Court of Justice - Ontario
Re: Christopher Phillips, Applicant And: SR & R Bay Ridges (Two) Ltd., Respondent
Before: Master Jolley
Counsel: Stephen Nadler, Counsel for the Moving Party Respondent Fatima Vieira, Counsel for the Responding Party Applicant
Heard: 30 September 2020
Reasons for Decision
[1] The respondent brings this motion to discharge the certificate of pending litigation that I granted to the applicant ex parte on 28 February 2020 over property municipally known as Unit 410, 1255 Bayly Street, Pickering, Ontario (the "Property"). It argues that the certificate of pending litigation should be discharged for three reasons: (1) lack of full and fair disclosure on the original ex parte motion; (2) the applicant has no reasonable claim to an interest in the Property and (3) the Dhunna factors (572383 Ontario Inc. v. Dhunna (1987) 24 C.P.C. (2d) 287) do not support the granting of a CPL.
[2] For the reasons set out below, the respondent's motion to discharge the certificate of pending litigation is granted both on the basis of the applicant's failure to disclose all relevant information at the ex parte hearing and on the basis of the Dhunna factors, with particular emphasis on the fact that it has been demonstrated that the Property is not unique and that damages would be an acceptable remedy.
A. Non-Disclosure
[3] While the threshold for issuing a certificate of pending litigation may be a low one, the test for disclosure is not. Rule 39.01(6) provides as follows:
(6) Where a motion or application is made without notice, the moving party or applicant shall make full and fair disclosure of all material facts, and failure to do so is in itself sufficient ground for setting aside any order obtained on the motion or application.
[4] The respondent argues that the applicant failed to disclose the following material documents:
- The agreement of purchase and sale;
- The interim occupancy documents he signed in October 2019;
- The letter from the respondent dated 25 February 2020 citing the newly discovered rental of the Property as a further ground of termination of the agreement of purchase and sale.
[5] It argues that, in addition, the applicant failed to disclose the following material facts, among others:
- The applicant agreed, as a term of the agreement of purchase and sale, to never register a CPL against the Property;
- The applicant contracted out of any interest in the Property by expressly agreeing, as a term of the agreement of purchase and sale, that he did not acquire any legal, equitable or proprietary interest;
- The applicant was required to pay occupancy fees on the first of each month and, with all other terms of the agreement, time was of the essence;
- The applicant was permitted to lease the Property only with the written consent of the respondent;
- To obtain that consent, the applicant was required to deliver his proposed form of lease for the respondent's approval and to provide evidence that the lease was not below fair market value; and
- The applicant represented in the HST Rebate Confirmation document that he signed on the interim closing that the Property would be his primary residence.
[6] There is no evidence before me that the applicant provided me with a copy of the agreement of purchase and sale on the ex parte motion in February. Certainly it was not part of his record. If the agreement was separately handed up to me, it is conceded that it was not argued in any meaningful way nor were the material provisions pointed out to me. As noted in 1245519 Ontario Ltd. v. Rossi 2008 ONSC 6933, citing Cimaroli v. Pugliese (1988) 25 C.P.C. (2d) 10 (Ont. H.C.), leave to appeal refused (1988) 12 W.D.C.P. 123 (Ont. Div. Ct.), attaching a document as an exhibit to a supporting affidavit without highlighting the material facts at issue can constitute material non-disclosure. The same can be said about handing up a lengthy document at the request of the court without highlighting or mentioning any of the relevant provisions.
[7] The applicant argues that the agreement was not material.
[8] The test to meet the disclosure requirement is not whether the information would have impacted my decision but whether it might have done so (Malekzadeh v Barron Homes 2018 ONSC 5506 at paragraphs 7, 17, 21 and 27-33). Categorically, had the information set out below been before