Ontario Superior Court of Justice

Court File No.: FS-17-416361
Date: 2021-06-21

Between:
Annette Levine (Applicant)
– and –
Stephen Levine (Respondent)

Counsel:
Steven Benmor, for the Applicant
Valois P. Ambrosino, for the Respondent

Heard: June 17, 2021

Endorsement

Faieta J.:

[1] Even though several order have been made that address the terms for the sale of the matrimonial home, 22 Joshua Court, Thornhill, Ontario (“the Property”), each party brings a motion for an order imposing certain terms of sale in respect of the matrimonial home.

BACKGROUND

[2] The parties separated in 2016 after about 23 years of marriage. Two of their three children live independently. After their separation, the Applicant moved to a townhouse that she purchased. The Respondent continues to reside in the matrimonial home with their youngest daughter, age 22, who will be moving to British Columbia in August, 2021 to pursue a Master’s degree.

[3] In 2017, the Applicant brought a motion for various orders, including an order for the sale of the matrimonial home and two other properties. On November 27, 2017, Justice Moore granted the relief sought by the Applicant. His Order states:

The 3 properties registered to the Applicant located at 22 Joshua Court, Thornhill, Ontario, 1167 Parkers Point Road, Gravenhurst, Ontario and 7 Hendon Avenue, Toronto, Ontario shall be forthwith sold in accordance with the following terms of sale:

(1) Within 10 days of the date of this order, the Applicant shall provide to the Respondent with the names of 3 licensed real estate agents who are available to list and sell the properties;

(2) Within 5 days of the date of this order, the Respondent shall select 1 of these 3 agents to list and sell the properties, failing which the Applicant shall select such person and be authorized to sign the listing agreements for their sale;

(3) The Properties shall be forthwith listed for sale at a price that the selected agent recommends, based upon his or her professional opinion and a review of comparable properties;

(4) No later than 30 days prior to the closing date of each transaction, the Applicant shall provide the Respondent with the name of 3 real estate lawyers who are available to jointly represent the parties in order the complete the transactions;

(5) No later than 20 days prior to the closing date of each transaction, the Respondent shall select 1 of these 3 lawyers to jointly represent the parties in order to complete the transaction, failing which the applicant shall select such person and be authorized to sign any and all documents necessary to list and sell the properties and complete the transactions;

(6) The parties shall cooperate and sign any and all documents necessary to list and sell the properties and complete the transactions;

(7) The Respondent shall cooperate with the real estate agent and allow open houses, showings and inspections by such person and/or prospective purchasers and shall maintain the properties in a clean and presentable manner so as to maximize the sale prices; and

(8) From the proceeds of sale of each property, any and all outstanding property taxes and utilities, real estate commissions, legal fees and disbursements and HST necessary to complete the transaction shall be paid and the balance shall be held in trust pending further order or as direction by the court hearing the motion.

[4] The parties returned to this Court in 2018 for further direction regarding the sale of the 3 properties. Justice Stevenson’s Endorsement, dated May 15, 2018, states:

Order to go as follows:

1. The realtor for the sale of the matrimonial home municipally known as 22 Joshua Court, Thornhill, Ontario shall be Paul Zammit;

2. The realtor for the sale of the condominium municipally known as 7 Hendon Avenue, North Yor, Ontario shall be Michael Davidson;

3. All three properties shall be actively listed on MLS for no less than seven days prior to entertaining any offers to purchase. Neither party is prohibited from making an offer to purchase at the same time as other potential purchasers after the seven day period;

4. Neither party shall be present on or about the three properties located at 22 Joshua Court, Thornhill, Ontario, 7 Hendon Avenue, North York, Ontario and 1167 Parkers Point Road, Gravenhurst, Ontario during such time as there are open houses, viewings by prospective purchasers or inspections. The respondent shall be provided with at least two hours’ notice with respect to any viewings at the matrimonial home or the condominium by prospective purchasers or an attendance by an inspector. He shall be provided with at least 24 hours’ notice of any open houses. Both parties shall fully cooperate with the realtors in ensuring that any open houses, viewings by prospective purchasers, or inspections take place in a timely fashion and that there is no interference by either party;

5. Both parties shall cooperate with respect to the listing and sale of the properties. If there is a failure by either party to comply with the terms set out above, the matter may be returned before me on the regular motions list to be determined on proper evidence filed by the parties;

6. Given the order made, I trust that the parties will be able to resolve the issue of costs. …

[5] In mid-2018, the matrimonial home was listed for sale at a price of $1,788,000.00 even though Mr. Zammit had recommended a lower price. No offers were received, except an offer of $1,400,000 from the Respondent which was not accepted. The listing expired in September, 2018.

[6] In 2019, the Applicant sought an order that would give her sole authority to retain a realtor, market the property and solicit offers. On October 6, 2019, Justice Gilmore declined to grant the relief sought and instead, at paragraph 55, made the following Order:

The matrimonial home shall be re-listed for sale by Mr. Paul Zammit. The terms of the order of Stevenson, J. dated May 15, 2018 shall remain in effect with respect to the parties’ cooperation in relation to the listing and sale of the property. The list price shall be set by Mr. Zammit.

[7] A new listing agreement was prepared. The Respondent signed the new listing agreement on November 26, 2019. The Applicant never signed that listing agreement.

[8] A case conference was held on November 16, 2020 before Justice Goodman. The parties discussed the settlement of their differences related to the process for the sale of the matrimonial home. Mr. Zammit participated on the conference call. Justice Goodman’s Endorsement states:

… nothing I or counsel said in the “S/C” on the issues would be admissible. If either party wishes to put any evidence before the court regarding Mr. Zammit’s position or advice, that specific information is to be obtained from him independently for purposes of inclusion of it in admissible evidence and it is not to be adduced from or identified as information sought from or provided by him during the [conference call]. …

Order to go:

1. A motion and cross-motion may be brought if necessary on the issues of the length of the MLS listing, process for showing the home, and for the process to be used to consider offers, including the manner in which a party’s offer is to be handled. To be clear, to the extent that the order in place at the present time addresses the last issues that I have just mentioned, it is not to be re-litigated by the parties. Unless the parties consent to an order changing the term or the parties differ on the meaning of the terms and require an order settling that difference. The parties are not to revisit the term that was ordered.

[9] With respect to her motion, the Applicant seeks an order that will result in the matrimonial home being “… quickly sold, with the least inconvenience and for the maximum sale price”. To that end, the Applicant seeks the following Order:

1. The parties shall forthwith sign an MLS Listing Agreement with realtor Paul Zammit for the sale of 22 Joshua Court, Thornhill for a period of 90 days based on Mr. Zammit’s recommendations for the listing price and any other terms of sale that will maximize the sale price and the speed of sale. In case the Respondent does not sign same within 48 hours of delivery to his counsel, then such signature is waived.

2. The MLS Listing will set out that showings of the home to potential buyers may be scheduled to occur on Tuesdays and Thursdays from 5:00 p.m. to 8:00 p.m. and on Saturdays and Sundays from 2:00 p.m. to 4:00 p.m.

3. The parties and all occupants of the property shall be absent during the aforementioned showing times.

4. The Respondent will ensure that the property is clean, tidy and presentable to maximize its sale price.

5. All communications with Mr. Zammit shall be via email and both parties and counsel will be included in all communications.

6. The MLS Listing will set out that all offers to purchase the home must be registered with Mr. Zammit between 4:00 p.m. and 6:00 p.m. on July 12, 2021. After all offers are registered with Mr. Zammit, then he will present same to the parties for consideration. Mr. Zammitt will provide the parties his recommendations on the sign-back or acceptance of any offer. If the parties cannot mutually agree on the acceptance of an offer, then the matter will be returned to court on 48 hours’ notice.

7. In the event that the Respondent wishes to register an offer to purchase the home, then he shall use an independent realtor to present an offer just the same as any other potential buyer.

8. No potential buyer will be made aware of any offers on the property before 6:00 p.m. on July 12, 2021.

9. So as to ensure COVID-19 safety protocols are satisfied:

a. only one showing shall occur at any given time;

b. there shall be no public open houses;

c. a maximum of four people plus realtors may attend each showing;

d. potential buyers shall wear appropriate personal protective equipment, specifically masks, gloves and booties’ to be supplied by their realtors.

[10] The Respondent intends to make an offer to purchase the Property. He states that the Applicant’s draft order, which prevents him from seeing offers as they are received, will prevent him from make the best offer.

[11] The Respondent further submits that the Applicant seeks to re-litigate the listing of the matrimonial home and exclude him from the sale process. He further states that he believes that the Applicant’s main motivation in advancing this motion is to gain a litigation advantage at trial by “foisting” him out of the matrimonial home and depriving him of a residence while the equity in that property is held in trust pending trial. The Respondent seeks the following Order:

1. The parties shall sign an MLS Listing Agreement for the sale of 22 Joshua Court, Thornhill with realtor Paul Zammit for a period of 90 days within 7 days of this Order.

2. Showings to potential buyers may occur on Tuesdays and Thursdays from 6:00 p.m. to 8:00 p.m. and Saturday or Sunday (not both on one weekend) from 2:00 p.m. to 4:00 p.m., on three hours’ notice to the Respondent.

3. The parties shall be absent during the aforementioned showings.

4. The Respondent will ensure that the property is clean, tidy and presentable to maximize interest to potential buyers and maximize its sale price.

5. In the event that a party wishes to register an Offer to Purchase the property, then that party shall use an independent realtor to present a registered Offer To Purchase.

6. Except for the parties, no buyer should be made aware of any offers on the property.

7. So as to ensure COVID-19 safety protocols are satisfied:

a. only one showing shall occur at any given time;

b. there shall be no public open houses;

c. a maximum of two people plus realtors may attend each showing; and,

d. potential buyers shall wear appropriate personal protective equipment, specifically masks, gloves and booties’ to be supplied by their realtors.

8. Paragraph 20 of the Applicant’s affidavit shall be struck as it purports to refer to comments/recommendations made by the Honourable Justice Goodman at a settlement conference attendance.

9. Except for the prayer for relief in the Applicant’s motion that overlaps this motion, the Applicant’s motion dated May 10, 2021 is hereby be dismissed with costs.

[12] The terms of the sale of the Property are specified by paragraphs 1-3 and 6-7 of Justice Moore’s Order, paragraphs 1, 3 -5 of Justice Stevenson’s Order, paragraph 55 of Justice Gilmore’s Order.

[13] Various concerns were raised by the parties on this motion.

Disclosure of Offers to the Potential Buyers

[14] The Respondent intends to make an offer to purchase the Property. He objects to paragraph 8 of the Applicant’s draft order which states that a potential buyer is not to be made aware of other offers.

[15] The Respondent objects to paragraph 8 of the draft Order on the basis that it would require Mr. Zammit to breach his ethical obligations under the Code of Ethics, O. Reg. 580/05 (“the Regulation”). Section 24 of the Regulation states:

Conveying offers

24. (1) A registrant shall convey any written offer received by the registrant to the registrant’s client at the earliest practicable opportunity. O. Reg. 580/05, s. 24 (1).

(2) A broker or salesperson shall establish a method of ensuring that,

(a) written offers are received by someone on behalf of the broker or salesperson, if the broker or salesperson is not available at the time an offer is submitted; and

(b) written offers are conveyed to the client of the broker or salesperson at the earliest practicable opportunity, even if the broker or salesperson is not available at the time an offer is submitted. O. Reg. 580/05, s. 24 (2).

(3) Without limiting the generality of subsections (1) and (2), those subsections apply regardless of the identity of the person making the offer, the contents of the offer or the nature of any arrangements for remuneration. O. Reg. 580/05, s. 24 (3); O. Reg. 539/20, s. 5.

(4) Subsections (1) to (3) are subject to any written directions given by a client. O. Reg. 580/05, s. 24 (4).

(5) Subsections (1) to (4) also apply, with necessary modifications, to,

(a) written amendments to written offers and any other written document directly related to a written offer; and

(b) written assignments of agreements that relate to interests in real estate, written waivers of conditions in agreements that relate to interests in real estate, and any other written document directly related to a written agreement that relates to an interest in real estate. O. Reg. 580/05, s. 24 (5).

(6) Subsections (1) to (5) apply, with necessary modifications, if a brokerage and a customer have an agreement that provides for the brokerage to receive written offers. O. Reg. 580/05, s. 24 (6).

(7) Subsections (1) to (5) apply, with necessary modifications, to brokers and salespersons employed by a brokerage, if the brokerage and a customer have an agreement that provides for the brokerage to receive written offers. O. Reg. 580/05, s. 24 (7). [Emphasis added]

[16] In his materials, the Respondent only referenced sections 24(1)-24(3) of the Regulation. If he had re-produced section 24 in its entirety, the Respondent would have seen that the obligation to promptly convey an offer to a client is not absolute and is subject to the client’s direction. I find that it is appropriate in these circumstances for the parties to direct that offers for the purchase of the Property not be conveyed to them until all offers are presented given that the Respondent is a prospective purchaser.

[17] Under s. 26(1) of the Regulation, the Realtor is obliged to disclose the number of competing offers but not the substance of those offers. to the Respondent’s submission, to every person who has made an offer. In this case, the Realtor will be able to comply with this obligation without compromising the integrity of the sales process given that he is not disclosing the substance of the other offers.

[18] Under the terms of this Order, the Respondent will have every opportunity to make an offer for the purchase of the Property. Whether his offer is successful will depend on whether the terms of his offer are better than any other prospective purchaser’s offer. The real estate sales process contemplated by the Listing Agreement contemplates “blind” offers to be made by prospective purchasers in that they do not know the terms of the offers made by other prospective purchasers. By relying on s. 24(1) of the Regulation, the Respondent seeks an advantage over other purchasers in that he will be informed of the terms of other offers. This also has the effect of removing any impetus for the Respondent to make an aggressive bid. As a result, the sales process for the Respondent would be similar to an auction style sales process rather than a blind bid sales process.

[19] If the Respondent were permitted to view the offers of other prospective purchasers prior to making his own offer, then he would effectively be provided with a right of first refusal in respect of the sale of the Property. The views expressed by the Ontario Court of Appeal in Barry v Barry, 2020 ONCA 321, para.9, are applicable:

As this court explained in Martin v. Martin (1992), 1992 7402 (ON CA), 8 O.R. (3d) 41 (Ont. C.A.), a right of first refusal is a substantive right that has economic value. It falls outside the boundaries of what is ancillary or what is reasonably necessary to implement the order for sale of the matrimonial home. It distorts the market for the sale of the matrimonial home by eliminating the need to compete against any other prospective purchaser, thus potentially reducing the amount the joint owning spouse realizes on the sale. In the absence of consent, the right of first refusal should not have been granted in this case. If the respondent seeks to purchase the matrimonial home, he must compete with any other interested purchaser.

[20] Accordingly, as either party could make an offer to purchase the Property (although the Applicant has expressed no such intention), the terms of any offers to purchase the Property shall not be conveyed to either party in advance of the parties reviewing all offers.

Communications between Mr. Zammit and the Parties

[21] The Applicant seeks to have all communications between Mr. Zammit and the parties be via email. She also seeks that counsel for both parties be included on the emails.

[22] While there is a lack of trust between the parties, I agree with the Respondent that this provision would unnecessarily complicate matters.

Offers must be registered between 4:00 pm and 6:00 pm on July 12, 2021

[23] The Applicant asks that all offers be submitted within a two-hour window. This is an unnecessary impediment to a prospective purchaser and could have the effect of narrowing the pool of prospective purchasers. In my view, this provision should simply require that offers be delivered by a certain date and time.

Other Matters

[24] Remarkably, although directed by Justice Gilmore to re-list the Property with Mr. Zammit at whatever price he recommends, paragraph 1 of each of the draft Orders seeks to duplicate that direction. The parties have been unable to cooperate on how to implement this court’s various directions for the sale of the Property and they require this court’s direction on the minutiae of the terms of the sale process of the Property. Accordingly, on this fifth time before the court on this issue, the court will afford the parties little discretion in the sale process in an attempt to avoid further disputes.

[25] In some ways, given paragraphs 3 and 7 of Justice Moore’s Order, paragraph 1, 3, 4 and 5 of Justice Stevenson’s Order and paragraph 55 of Justice Gilmore’s Order, these motions could be viewed as an abuse of process, however, it is more efficient for this court to simply dictate concrete terms for the sales process in order to bring this matter to an end.

[26] Therefore, I make the following Order:

1. Both parties shall cooperate with each other and with their real estate agent, Paul Zammit (“the Realtor”) with respect to the listing and sale of 22 Joshua Court, Thornhill, Ontario (“the Property”) and they shall sign any and all documents necessary to list and sell the Property and complete the transaction.

2. By June 28, 2021, the parties shall sign a MLS Listing Agreement for the sale of the Property, in the form presented by the Realtor, (“the Listing Agreement”) with the Realtor for a period of 90 days.

3. The listing price for the Property described in the Listing Agreement shall:

a) be determined by the Realtor in his sole discretion; and,

b) not be greater than the fair market value of the Property as determined by the Realtor.

4. The Listing agreement shall include the following terms:

a) Any offer for the purchase of the Property shall be delivered to the Realtor no later than 9:00 am on July 12, 2021;

b) The parties direct that any offer for the purchase of the Property shall not be entertained by the parties, nor conveyed to the parties, until 10:00 am on July 12, 2021;

c) The parties shall meet by videoconference with the Realtor to review the offers on July 12, 2021 at 10:00 am.

d) In the event that either party wishes to make an offer for the purchase of the Property, then such party shall retain a real estate agent other than Realtor for that purpose;

e) After his review of the offers for the purchase of the Property on July 12, 2021, the Realtor, in his sole discretion, shall determine whether a second round of offers should be requested from all persons who submitted an offer to purchase and the parties accept his recommendation. If a second round of offers is invited, then such invitation must be made by 1:00 pm on July 12, 2021 and any offers for the purchase of the Property arising from the second round shall be delivered by 6:00 pm on July 12, 2021. No further offers to purchase the Property shall be permitted after the deadline for the receipt of the second round of offers.

e) The parties direct that any offer for the purchase of the Property resulting from a second round invitation for offers, if any, will not be entertained by the parties, nor conveyed to the parties, until 7:00 pm on July 12, 2021.

f) The parties shall meet by videoconference with the Realtor to review the offers on July 12, 2021 at 7:00 pm.

5. Appointments for the showing of the Property shall occur on Tuesdays and Thursdays from 6:00 pm to 8:00 pm and on Saturdays from 2:00 pm to 4:00 pm. until July 11, 2021. Neither the parties, their children or anyone else aside from a prospective purchaser and their real estate agent shall be in or outside the Property during a showing.

6. The Respondent shall be provided with at least 24 hours’ notice in respect of an inspection of the Property by a home inspector retained by a prospective purchaser.

7. The Listing Agreement shall state that the Realtor shall take all reasonable measures to ensure that all applicable COVID-19 protocols shall be complied with in respect of the showing of the Property. There shall be no open houses. A showing shall be by appointment only. See https://covid-19.ontario.ca/public-health-measures In particular, requirements for planning for an in-person showing, steps during the in-person showing and after the in-person showing shall be complied with. See https://www.reco.on.ca/covid-19/. These requirements include: (1) only one showing shall occur at any given time; (2) a maximum of three people, including realtor(s), shall be allowed into the home for each showing; (3) all persons attending a showing shall wear a face covering while in or outside the home. The above requirements also apply, with the necessary changes, to an inspection of the Property by a home inspector.

8. If either party fails to comply with this Order, then the parties may contact the Family Law Trial Office to arrange a motion by video conference before me on 24 hours’ notice. On such motion, the moving party shall address whether it is also appropriate to grant relief under Rule 1(8) of the Family Law Rules given the circumstances and Rules 2(2)-2(5) of the Family Law Rules.

9. Any party seeking their costs of this motion, shall deliver their costs submissions within 7 days. Responding submissions shall be delivered within 14 days. Reply submissions within 17 days. Each submission shall be no more than three pages long, exclusive of a bill of costs and any offers to settle.

____________________ Faieta J.

RELEASED: June 21, 2021