COURT FILE NO.: CV-20-646740

DATE: 20211123

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Kathleen Crook, Plaintiff

– AND –

Kerry Adler, 2138746 Ontario Inc., Rachel Bellissimo, and Anna Vinberg, Defendants

BEFORE: Justice E.M. Morgan

COUNSEL: Timothy Duggan and Spencer Toole, for the Plaintiff

HEARD: In writing

ENDORSEMENT

[1] The Defendants, Kerry Adler (“Adler”), 2138746 Ontario Inc. (“213”) and Rachel Bellissimo (“Bellissimo”), have brought a Counterclaim in this proceeding against the Plaintiff, Kathleen Crook (“Crook”). Crook contends that the claims advanced in the Counterclaim are duplicative of claims that Adler and 213 have advanced in separate proceedings before the Landlord and Tenant Board.

[2] It is Crook’s position that the simultaneous pursuit of identical claims in two different forums amounts to an abuse of this court’s process. The Defendants have refused Crook’s reasonable request that they choose one of the Counterclaim or the Landlord and Tenant Application to pursue. No one has filed materials on behalf of any of the Defendants despite being properly served.

[3] Crook is the owner of a luxury residential property in Toronto. 213 was a tenant of the property and Adler is a director and officer of that company. Bellissimo was never a tenant of the property, but rather was an employee of 213 with no legal relationship with Crook.

[4] In July 2020, the 213 and Adler commenced an Application at the Landlord and Tenant Board in which they allege that Crook acted in bad faith in serving them with a notice to terminate their tenancy for landlord’s own use. Specifically, they alleged that:

a. Crook served them with the termination notice;

b. they vacated the property as a result of having been served with the termination notice;

c. they subsequently discovered that Crook had listed the property for sale within the one-year period following the date on which they vacated the property;

d. the termination notice was therefore given in bad faith; and

e. Crook’s conduct entitled them to monetary compensation.

[5] In September 2020, Crook commenced the within action. In the Statement of Claim, Crook alleges, among other things, that the Tenants’ commencement of the Tenant Application constitutes a breach of a settlement agreement that was reached between Crook and 213 and Adler in prior proceedings before the Landlord and Tenant Board . In December 2020, the Defendants delivered a Statement of Defence and Counterclaim in which they allege:

a. Crook served them with the termination notice;

b. they vacated the property as a result of having been served with the termination notice following negotiations with Crook;

c. they subsequently discovered that Crook had listed the property for sale within the one-year period following the date on which they vacated the property;

d. the termination notice was therefore given in bad faith; and

e. Crook’s conduct entitled them to monetary compensation.

[6] As indicated, Bellissimo is a party to the Counterclaim despite the fact that she was never a tenant of the property, was not one of the recipients of the termination notice, and was never in any other relationship with Crook. Bellissimo’s only involvement in the events at issue in these proceedings is that she signed the Settlement Agreement and made representations on behalf of the tenants, 213 and Adler – i.e. her employers.

[7] The affidavit evidence in the record states that Crook attempted to avoid the necessity of bringing this motion by requesting that the Defendants discontinue either the Tenant Application or the within Counterclaim. The Defendants refused this request, taking the position that they are entitled to simultaneously pursue both the Tenant Application and the Counterclaim. They are not so entitled.

[8] Rule 21.01(3)(c) of the Rules of Civil Procedure allows a defendant to move to have an action stayed or dismissed on the basis that another proceeding is pending in Ontario or another jurisdiction between the parties in respect of the same subject matter. This rule applies equally to claims and counterclaims: Birdseye Security Inc. v. Milosevic, 2020 ONCA 355, at para 14. Rule 21.01(3)(d) and rule 25.11 allows a defendant to move to have an action stayed or dismissed on the basis that the action is frivolous, vexatious, or an abuse of the court’s process.

[9] In determining a motion under Rule 21.01(3)(c), it is incumbent on the court to assess whether the continuation of the action will cause substantial prejudice to the moving party because it would be oppressive or vexatious or an abuse of the court’s process, and whether the dismissal or stay would cause an injustice to the responding party. The factors to consider include the likelihood and effect of the two matters proceeding in tandem, the possibility and effect of different results, the potential for double recovery, and the effect of possible delay: Ibid., at paras. 14-15.

[10] The doctrine of abuse of process generally prohibits a multiplicity of proceedings. A new proceeding that asserts the same claims as an existing proceeding, and that would amount to relitigating the same issues, constitutes an abuse of the court’s process. This doctrine applies to proceedings before courts and administrative tribunals alike.

[11] The presence of duplicate proceedings satisfies the requirements of Rule 21.01(3)(c) as well as Rule 21.01(3)(d): Maynes v. Allen-Vanguard Technologies Inc., 2011 ONCA 125, at para. 36. Thus, where the causes of action and alleged damages claimed in multiple proceedings arise from the same factual matrix, the proceedings are considered duplicative and are an abuse of the court’s process: Carbone v. DeGroote, 2018 ONSC 109, at paras 35-7.

[12] The record before me establishes that Crook would be prejudiced by having to defend both the Counterclaim and the Landlord and Tenant application, as she would be forced to incur two sets of legal costs and the Tenants would have the opportunity for double recovery. On the other hand, 213 and Adler would not be prejudiced by the dismissal of their Counterclaim, as they would retain the ability to pursue their claims at the Landlord and Tenant Board where they first went to pursue their claims): Ibid., at para. 35.

[13] As already set out above, Bellissimo was not a tenant of the property and had no other relationship with Crook. The Counterclaim as advanced by Bellissimo contains no viable cause of action. It cannot survive a challenge under Rule 21.01(3)(d), as it is frivolous and vexatious.

[14] In light of all of this, the Counterclaim is dismissed in its entirety.

[15] As the successful party, Crook is entitled to a reasonable expectation that it will receive an order for payment of its costs unless there are special circumstances: Lundy’s Regency Arms Corp. v. Potato Factory Bar & Grill Corp., 2020 ONSC 238, at para 11 (Div Ct). Using rounded off numbers, Crook seeks costs on a partial indemnity basis of $5,300 plus disbursements of $450.00, inclusive of HST. This is not an unreasonable amount given the effort that Crook’s counsel was put to.

[16] An award of this amount satisfies the principle of indemnity for the successful party and is not an amount that would take the unsuccessful parties by surprise: Rules 57.01(1)(0.a) and (0.b). In general, it satisfies the overriding principles of fairness and reasonableness that guide courts in awarding costs: Boucher v. Public Accountants Council for the Province of Ontario, (2004) 71 O.R. (3d) 728 (Ont CA).

[17] Adler, 213, and Bellissimo shall pay Crook costs in the all-inclusive amount of $5,750. They are jointly and severally liable for this amount, which is payable forthwith.

Morgan J.

Date: November 23, 2021