Court File and Parties

COURT FILE NO.: CV-20-00084245-0000

DATE: April 26, 2021

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: DUANE ROBINSON, Applicant

AND:

ANDREA BERGERON and DANIEL PLOUFFE, Respondents

BEFORE: Justice Patrick Hurley

COUNSEL: Aaron King, for the Applicant

Ryan Deacon, for the Respondent Andrea Bergeron

Kaitlin Brennan, for the Respondent Daniel Plouffe

HEARD: March 12, 2021

ENDORSEMENT

Introduction

[1] The applicant, Duane Robinson, owns property at 174 Bruce Street, Renfrew. The respondents, Andrea Bergeron and Daniel Plouffe, began occupying it in August 2016. In his application, Mr. Robinson is asking for a declaration that they have breached an agreement of purchase and sale dated August 7, 2016 (the “APS”) and amendments to it dated April 7, 2018 and June 27, 2019; an order evicting the respondents; and damages. Mr. Plouffe has vacated the property but Ms. Bergeron continues to live there.

[2] Ms. Bergeron has brought a motion to stay the application as against her on the basis that the Landlord and Tenant Board has exclusive jurisdiction over the dispute under the Residential Tenancies Act, 2006, S. O. 2006, c. 17 (the “RTA”). Although Mr. Plouffe has not brought a motion, counsel appeared on his behalf at the hearing and supported Ms. Bergeron’s position.

[3] Mr. Robinson contends that the true substance of the transaction is an agreement of purchase and sale which has been breached by the respondents and that there has never been a landlord and tenant relationship.

The evidence

[4] The APS is dated August 7, 2016. The purchase price is $310,000 with a closing date of September 1, 2017. The agreement permitted the respondents to occupy the property commencing September 1, 2016 at a monthly cost of $1,385 plus utilities.

[5] Included in Schedule A to the APS are the following clauses:

The payments are a form of rent but the Buyers understand and agree that the situation does not fall under the Landlord & Tenant Act. The Seller is only giving this arrangement to the Buyers because they are unable to close the transaction earlier as they need a year to qualify for financing but they want possession of the property on September 1, 2016. Should the Buyers default on the monthly payment of $1,385.00 the Seller shall have the option to evict the Buyers with a one month notice.

On August 31, 2017, should the Buyers be unable to close the purchase transaction for any reason on 174 Bruce St., Renfrew, Ontario, the Buyers will forfeit their $10,000 deposit. At such time, the Seller will have the option to keep the Buyers on a month-to-month term at a monthly payment of $1,485.00 in addition to payment of hydro, water, gas, until such time of the Buyers can proceed with the purchase and close a new agreement date acceptable to both parties or evict the Buyers with a one month notice.

[6] The parties executed an amendment to the APS on April 7, 2018 which extended the closing date to July 1, 2019 and increased the monthly payment from $1,385 to $1,485 plus utilities.

[7] This amendment include the following terms:

If the purchasers are unable to close this transaction on July 1, 2019 the seller shall have the following options/remedies:

#1) Let the buyers continue to stay in the property with a new monthly payment of $1535 per month plus utilities and the buyers agree and acknowledge for none completion of the purchase, will have no further options to purchase 174 Bruce street.

#2) Give notice to the buyers that the property will be put up for sale and/or give the Buyers 1 month notice to vacate the property

#6) If by June the first, 2018 all monthly payments and utilities are not brought up to date the seller can give notice to the buyers to vacate the property with a one month notice. Furthermore should the buyers be in arrears of monthly payments of $1485 plus utilities from June the first, 2018 the Seller can notify the Buyers to vacate 174 Bruce St. with a one month notice.

[8] Mr. Robinson asserts that there was a third amendment dated June 30, 2019 but it is unsigned. It states that, as a result of a meeting between Mr. Robinson and Mr. Plouffe, they reached an agreement on the payment of arrears and that the new purchase price for the property as of June 1, 2019 is $316,710.

[9] It includes this paragraph:

The new monthly payments as of June 1st, 2019 as stated in the original agreement is now $1,535.00. All utilities shall be in good standing by September 1st, 2019. Failure to put and keep the utilities in good standing is a default under The Agreement, and the Seller shall have the option to take vacant possession of the property with a 1 month notice. At any time from July 1st, 2019 should the Buyers monthly payments of $1,535.00 become NSF the Seller, Mr. Robinson shall have the option of taking vacant possession of the property, 1 month from the day of the NSF. The Buyers will supply postdated cheque’s of $1,535.00 to the Seller beginning July 1st, 2019. The Buyers acknowledges and agrees they are not tenants as defined in the Residential Tenancies Act. They are Buyers under an Occupancy Licence which may be revoked at any time after default.

[10] The closing date was extended to June 1, 2020.

[11] At some point in 2020, Ms. Bergeron and Mr. Plouffe’s relationship ended and he left the property. Mr. Robinson’s lawyer sent a letter to the respondents in March 2020 purporting to terminate the APS and stating that he required vacant possession by June 1, 2020.

[12] Ms. Bergeron has remained living at the property. She has not made any payments to Mr. Robinson since June, 2020.

[13] Mr. Robinson listed the property for sale and, according to him, a person named Rich Danby was prepared to pay $275,000 for it in September 2020 but did not do so because Ms. Bergeron refused to sign a tenancy agreement with him. In her cross-examination, Ms. Bergeron testified that she discussed a tenancy agreement with a prospective purchaser but was told it would be of short duration and that he planned on evicting her so he rent the property for a higher amount.

The law

[14] In Fraser v. Beach, 2005 CanLII 14309 (ON CA), the Court found that the Tenant Protection Act, 1997, S. O. 1997, c.24 granted the Ontario Rental Housing Tribunal the exclusive jurisdiction to terminate a tenancy and evict a tenant. This remains the case under the RTA: Davies v. Syed, 2020 ONSC 5732.

[15] In Hassani v Marchewka, [1992] O. J. No. 1460, the vendor brought an application for a writ of possession, a declaration that the deposit was forfeited and damages. The parties had signed an agreement of purchase and sale which included a one-year lease. The transaction did not close because the purchaser could not obtain the funds to complete it but refused to give up possession of the property.

[16] Chapnik, J. granted a declaration that the agreement of purchase sale was at an end and directed a reference to determine damages. However, she held that the vendor could only obtain vacant possession of the property by serving a notice of termination in accordance with the Landlord and Tenant Act, R. S. O. 1980, c. 232. She stated at pg 3:

I find, in the circumstances, that both parties are subject to the provisions of the Landlord and Tenant Act. If the applicants wish to obtain vacant possession, they must serve the respondent with notice of termination in compliance with the provisions of that Act. The said respondent is hereby estopped from advancing the argument in any further proceedings that she is not a tenant or that rent is not payable on that basis. In the result, the applicant’s request for a mandatory order and for a writ of possession in respect of the property are denied.

[17] This decision was approved by the Divisional Court in Stefanizzi v. Jameus, 2016 ONSC 317.

Disposition

[18] I find that the applicant and Ms. Bergeron are in a landlord and tenant relationship and that the applicant must comply with the RTA in order to terminate the tenancy and obtain possession of the property.

[19] Ms. Bergeron has been, in effect, leasing the property since September 2016. Although the APS and amendments purport to characterize the relationship as solely a vendor-purchaser one and the monthly payments as something other than rent, the parties cannot contract out of the RTA: ss. 3(1) and 4(1).

[20] I decline to stay the application as a whole. The applicant is seeking relief – a declaration that the respondents have breached the APS and damages – that does not fall within the exclusive jurisdiction of the Landlord and Tenant Board.

[21] In my view, success has been divided and the parties should bear their own costs. If, however, they wish to make submissions on costs, Ms. Bergeron should deliver hers, which are not to exceed two pages exclusive of a costs outline, within 10 days of the date of the release of this decision. Mr. Robinson has five days in which to respond with submissions of the same length. As Mr. Pouffe did not file any responding materials and has vacated the property, he is not entitled to any costs in relation to this motion.

______________________________ Hurley, J

Date: April 26, 2021