COURT FILE NO.: CV-23-0054-00

DATE: 2023-06-09

SUPERIOR COURT OF JUSTICE – ONTARIO

RE: Attorney General of Ontario v. 175 River Street, Thunder Bay, Ontario, or Proceeds of Sale Thereof (in rem)

HEARD: June 8, 2023

BEFORE: Acting Regional Senior Justice T. Nieckarz

COUNSEL: C. Peterson, for the Applicant

Unrepresented Respondent

Endorsement

Nature of the Motion:

[1] This is the Attorney General of Ontario’s (AGO) motion for an order to preserve the real property municipally known as 175 River Street in Thunder Bay (the “Property”) as an instrument or a proceed (or both) of unlawful activity, pending the hearing of an application for forfeiture pursuant to the Civil Remedies Act, 2001, S.O. 2001, c. 28.

[2] The AGO alleges that the Property has been used to facilitate the sale and use of illegal drugs for more than 20 years. The AGO further alleges that the owner of the Property, Mr. Jonasson, has been involved in unlawful activity carried on at the property. He is alleged to be awaiting trial on charges of Possession for the Purpose of Trafficking Cocaine, Possession for the Purpose of Trafficking Hydromorphone and Possession of Property Obtained by Crime (under $5,000).

[3] Mr. Jonasson has appeared by telephone for this matter. On the original return date of April 6^th, 2023, Mr. Jonasson sought an adjournment to consult with counsel and gather some documents responsive to the issues before the court. The adjournment was granted to May 11, 2023, with the interim interim preservation order of Pierce J., dated March 8, 2023 (obtained without notice), continued to ensure that the interests of the AGO were preserved pending the return of the motion. I also provided Mr. Jonasson with some links to reference materials as to the court process in the event he remained self-represented.

[4] The matter returned back before the court on May 11, 2023. Mr. Jonasson sought a further adjournment to retain counsel. As of that date he had not consulted with counsel but had used the adjournment period to gather some of the documents requested by the AGO. He had no materials before the court. The motion was adjourned to June 8, 2023, peremptory on Mr. Jonasson. It was explained to Mr. Jonasson that he would not receive any more adjournments and that he needed to ensure that his responding affidavit is served and filed, and that he is ready to proceed with argument. I provided leave for Mr. Jonasson to file his documents in person at the Courthouse if he chose to do so (as opposed to through the online portal) and asked that he advise the court prior to the hearing if he was unable to load his documents into Caselines.

[5] The matter returned before me today. Mr. Jonasson still had no materials before the court. He advised that he had some documents related to his mortgage and other things requested by the AGO (i.e. insurance) but he had some computer related issues. He did not have an affidavit prepared. Nothing had been served on the AGO. Mr. Jonasson still had not consulted with counsel. Mr. Jonasson asked for another adjournment. In accordance with my May 11^th endorsement, that adjournment request was denied.

[6] Mr. Jonasson indicated verbally, on the record, that he disputes the motion and the forfeiture request on the basis that he has not conducted illegal activity from the property, and he wishes to prove that.

Discussion:

[7] Sections 4 and 9 of the CRA gives the court discretion to make an order for the preservation of property that is the subject of a civil forfeiture application if the court is satisfied that there are reasonable grounds to believe that the property is the proceeds or an instrument of unlawful activity, unless it would clearly not be in the interests of justice to do so.

[8] An “instrument of unlawful activity” is any property that is likely to be used to engage in unlawful activity that, in turn, is likely to or is intended to result in the acquisition of other property: CRA, s. 7.

[9] In Attorney General of Ontario v. 51 Taylor Avenue, 2012 ONSC 6355 at paras. 51-63, aff’d 2014 ONCA 396, real property (an apartment building) that was being used as a crack house was found to be an instrument of unlawful activity. Similarly, in Ontario v. 108 Fred Young Drive, Toronto (In Rem), 2016 ONSC 2033 at paras 63-71, a house that was used to sort, pack, and distribute marijuana was found to be an instrument of unlawful activity.

[10] The AGO argues that the evidence establishes that the property is being used for the trafficking of illegal drugs, and that proceeds of property obtained by crime has been found to be located at the Property.

[11] I am satisfied that it is appropriate to make the preservation order. Based on the evidence before me, I am satisfied that there are reasonable grounds to believe that the property is an instrument of unlawful activity for the following reasons:

a. The Property is well known to the Thunder Bay Police Serve as a location where illegal drug sales take place.

b. There have been numerous complaints received about activity at the Property at all hours of the day, necessitating regular police patrols around the area of the Property to try to deter this activity. Neighbours have complained about people associated with the house, property damage alleged to have been caused by them, noise complaints and fights. Neighbours have expressed fear about being in their own property given threats from people attending the Property and what they have observed.

c. In August 2021, the police began an investigation and conducted surveillance of the Property. Approximately 130 people were observed coming and going from a recreational vehicle (RV) parked in the driveway of the property at all hours of the day and night, over a three day period. This is behaviour typical of drug houses. Some of the individuals observed were well known to police to be part of the drug culture.

d. On August 26, 2021, police executed a Controlled Drugs and Substances Act search warrant at the Property and of the RV. Mr. Jonasson and another individual were alleged to have been inside the RV with drugs in their possession. Police observed items they believe were used to weigh and package drugs. Weigh scales were located on a table that was covered with a white substance. A scoop containing crack cocaine is also alleged to have been discovered. Within the house, two individuals were apprehended, one of whom tried to run away. Between the house and RV, cocaine, crack cocaine, tablets, cash and items commonly used in the drug trade were found. This was not the first search warrant executed at the house, nor the first time that Mr. Jonasson was arrested as a result.

e. Photographs of the house suggest it was not being used as a typical residence. It was littered with garbage and various items. Windows are boarded up.

f. Since the Property was acquired by Mr. Jonasson in 1998, police have had to attend the Property on 45 separate occasions. There have been an additional 91 observation slips entered for the Property that document occurrences observed by patrolling officers.

g. Individuals known in the drug subculture as well as individuals with outstanding warrants and stolen property have frequently been located at the Property. There have also been numerous traffic investigations of impaired people found parked near or leaving from the Property.

[12] For the purpose of granting a preservation order, the court does not need to be satisfied that Mr. Jonasson did in fact commit the crimes the AGO alleges. The analysis is centered around proving that the Property itself is associated with unlawful activity. I agree with the AGO that the burden of reasonable suspicion has been met.

[13] I further find that there are no factors that would make preservation “clearly not in the interests of justice”. This preservation motion does not finally determine the status of the Property or the legal rights of Mr. Jonasson. It merely protects the Property at issue pending a determination of the forfeiture application on its merits.

[14] As I have explained to Mr. Jonasson, it remains vitally important to his rights with respect to the Property that he ensures that whatever evidence he has to respond to the AGO’s allegations, is before the court. He must file his own affidavit, along with supporting documentation attached as exhibits to refute the allegations of the AGO. Once again, Mr. Jonasson is strongly encouraged to obtain legal advice with respect to the AGO’s forfeiture application. If Mr. Jonasson chooses, or is unable to obtain legal representation, I refer him to the following resources for some assistance with the procedural requirements. These resources are not a substitute for proper legal advice:

Resources – Civil Proceedings | Superior Court of Justice (ontariocourts.ca)

Notice to the Profession for Northwest Region | Superior Court of Justice (ontariocourts.ca)

NOTICE TO THE PROFESSION RE: CIVIL and FAMILY PROCEEDINGS IN THE NORTHWEST REGION | Superior Court of Justice (ontariocourts.ca)

Representing yourself in court (cjc-ccm.ca)

ORDER:

[15] An Order for the preservation of the Property shall issue in accordance with the draft filed and attached as Schedule “A” to this Endorsement.

“Original signed by” The Honourable Justice T.J. Nieckarz, Acting R.S.J.

DATE: June 9, 2023

SCHEDULE A

Court File No: CV-23-00000054-0000

ONTARIO

SUPERIOR COURT OF JUSTICE

THE HONOURABLE )

THURSDAY, THE 11TH DAY

JUSTICE

) OF MAY, 2023

B E T W E E N:

ATTORNEY GENERAL OF ONTARIO

-and -

Applicant I Moving Party

175 RIVER STREET, THUNDER BAY, ONTARIO, or PROCEEDS OF SALE THEREOF (in rem)

Respondent I Respondent Party

Jn the matter of an Application under the Civil Remedies Act, 2001

INTERIM PRESERVATION ORDER

THIS MOTION, made with notice by the Applicant and Moving Party, the Attorney General of Ontario, for a Preservation Order under the Civil Remedies Act, 2001 (the "Civil Remedies Act”), was heard this day at the courthouse at 125 Brodie Street North, Thunder Bay, Ontario.

ON READING the Notice of Motion, the Motion Record and Factum of the Attorney General of Ontario, and the Affidavits of Service, filed.

AND ON HEARING the submissions of counsel for the Attorney General of Ontario; and submissions and by the Respondent, Michael Jonasson, and from counsel for Legal Aid Ontario, parties having an interest in the property at issue and as such Respondents pursuant to s. 15.5 of the Civil Remedies Act,

1. THIS COURT ORDERS preservation of the real property municipally known as 175 River Street, Thunder Bay, Ontario, registered in Land Registry Office ("LRO") #55, legally described as PT LT 8-9 BLK D PL 579 MCINTYRE PT 2, 55Rl364; THUNDER BAY, being all of Property Identification Number ("PIN") 62150-0017 (LT) (the "Real Property "), until the final disposition of this Application, or until otherwise ordered by this Court, pursuant to sections 4(1) and 9(1) of the Civil Remedies Act.

2. THIS COURT ORDERS that, pursuant to subsections 4(1) and 9(1) of the Civil Remedies Act, the Real Property is preserved until the final disposition of this Application, or until otherwise ordered by this Court, and the Respondents or any person having knowledge of

this Order be and the same are hereby enjoined from dealing with the said Real Property in any manner whatsoever, including, but not limited to, any sale, lease, assignment, transfer, mortgage, lien or encumbrance of any kind until the completion of these proceedings or until such time as this Court orders.

3. THIS COURT ORDERS that the registered owner, being Michael Roy Jonasson (the "Registered Owner"), nor anyone acting on his behalf, nor anyone else claiming any interest in the Real Property, shall have any dealings with, sell, lease, assign, transfer with or without consideration, convey or further encumber, borrow against or otherwise use as security or

commence any proceedings pursuant to the terms of any mortgage or lien dealing with or in any way related to the Real Property.

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4. THIS COURT ORDERS that a copy of this Order shall be registered against title to the Real Property in LRO #55 and the Land Registrar is directed to place a "No Dealings" indicator on title to the Real Property, being all of PIN 62150-0017 (LT) in LRO #55.

5. THIS COURT ORDERS that if any mortgagee, or any other encumbrancer, commences an application to enforce its security against the Real Property, any such mortgagee or other encumbrancer shall not enter into in an agreement of purchase and sale for the Real Property, without the prior written approval of the Director of Asset Management-Civil (the "Director"), which approval shall be in the sole, absolute and unfettered discretion of the Director. The Director shall provide notice of its approval or disapproval of the terms of any agreement of purchase and sale to any mortgagee and/or other encumbrancer, within seven

(7) days of receipt of the proposed terms of the agreement of purchase and sale.

6. THIS COURT ORDERS that the Real Property shall be preserved by the Registered Owner who shall be required to maintain the said Real Property in a safe and secure state, and in a state of good repair, maintenance and order, and the Registered Owner shall be required to pay, by the applicable due date, any and all bills and/or expenses required and/or otherwise related to maintaining the Real Property.

7. THIS COURT ORDERS that the Real Property is to be preserved by the Registered Owner, who shall be required to maintain the insurance and utility services to the Real Property and shall be required to pay by the applicable due dates, all regular bills and/or expenses in connection with the Real Property, including, but not limited to, property taxes, common expenses, mortgage payments, insurance, electricity, water, gas and any other utility accounts that come due (collectively, the "Expenses").

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8. THIS COURT ORDERS that in the event the Real Property is rented out to tenants and the tenants are responsible for payment of one or more of the Expenses outlined in paragraph 7 of this Order, the Registered Owner shall ensure each tenant has paid, or the Registered Owner shall make payment on behalf of each tenant, for all Expenses that become due and payable, by the applicable due dates.

9. THIS COURT ORDERS that the Registered Owner shall continue to duly and punctually collect any and all rent, additional rent, and/or other occupancy fees and payments due and owing from all tenants of the Real Property, and shall continue to pursue any and all arrears of any such fees and payments as would a prudent owner and/or operator of a property similar to the Real Property.

10. THIS COURT ORDERS that the Director, or such person as may be designated by or required to assist the Director, shall be permitted, on forty-eight (48) hours' notice to the Registered Owner or any person occupying the Real Property or any portion, or portions thereof, to enter upon any portion of the Real Property, inspect and photograph such Real Property to ensure compliance with this Order and to determine the value and condition of the Real Property, as the case may be.

11. THIS COURT ORDERS that the Director may, from time to time and at any time, request information on any mortgage or encumbrance registered against title to the Real Property, including the amount required to pay out the mortgage or encumbrance or to bring the mortgage into good standing, and all parties who receive such a request shall comply within fifteen (15) days.

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12. THIS COURT ORDERS that the Registered Owner shall provide to the Attorney General of Ontario through its counsel, copies of all insurance policies with respect to the Real Property. If the Registered Owner fails to provide copies of all insurance policies with respect to the Real Property to the Attorney General of Ontario through its counsel, the Attorney General of Ontario and/or its counsel may make a request for information with respect to the insurance policies from the applicable insurance companies and the insurance companies shall comply with requests for information with respect to these policies within ten (10) days of a request by the Attorney General of Ontario and/or its counsel.

13. THIS COURT ORDERS that the Registered Owner shall, subject to the terms of this Order, amend all insurance policies in effect on the Real Property to add the Attorney General of Ontario as a party to whom loss is payable and to provide proof to the Director that all such insurance policies have been amended to show the Attorney General of Ontario as a loss payee. Failing compliance by the Registered Owner, the Director shall have the right to directly instruct the insurance company to amend the loss payable provision on all insurance policies in effect on the Real Property into the name of the Attorney General of Ontario.

14. THIS COURT ORDERS that the Registered Owner shall provide notice to the Attorney General of Ontario of any insurance claim which arises pertaining to the Real Property within seven (7) business days of becoming aware of such claim.

15. THIS COURT ORDERS that the Registered Owner shall forthwith provide notice to the insurer under any policies of insurance in effect on the Real Property and to the Director, of any change in material risk, increased hazard, or vacancy or non-occupancy of the Real Property, or any part or parts thereof, extending beyond thirty (30) days. Failing compliance

by the Registered Owner, the Director shall notify the insurer directly of these changes.

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16. THIS COURT ORDERS that all authorities, being any federal, provincial, regional or municipal governmental authority, body, agency, department, or corporation, having or claiming jurisdiction over the Real Property and all public utilities, shall be authorized to release the contents of its file to the Office of the Attorney General of Ontario, including, without limitation, any building and zoning matters relating to the Real Property, any work orders outstanding or pending with respect to the Real Property, any outstanding water or property tax arrears with respect to the Real Property and any electrical safety compliance issues relating to the Real Property.

IF REAL PROPERTY IS SOLD OR SUBJECT TO AN AGREEMENT OF PURCHASE AND SALE

17. THIS COURT ORDERS that, in the alternative, if the Real Property has been sold on or prior to the date of this Order, then, pursuant to subsection 4(1) of the Civil Remedies Act any and all consideration paid or payable in connection with any such sale, which consideration represents the net proceeds from the sale of the Real Property, is preserved until the final disposition of this Application, or until otherwise ordered by this Court.

18. THIS COURT ORDERS that if the Real Property has been sold as contemplated by paragraph 17 above, the solicitors for the Respondent shall provide the Attorney General with a copy of the statement of adjustments, any commission statements indicating amounts owed to any real estate agents, the solicitor's statement of account, together with the reporting letter to the Registered Owner within ten (10) business days of the competition of the sale transaction.

19. THIS COURT ORDERS that to preserve the proceeds of any sale of the Real Property, the proceeds contemplated by paragraph 17 of this Order shall be deposited with the Accountant

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of the Superior Court of Justice in Ontario in an interest-bearing account to the cred it of the Application.

20. TIDS COURT ORDERS that, in the alternative, if as of the date of this Order, the Property is the subject of an executed agreement of purchase and sale (an "APS") pursuant to which the Real Property is to be sold to a purchaser, then (i) the Registered Owner, or any mortgagee or encumbrancer exercising its right under a mortgage or encumbrance to sell the Real Property, shall forthwith advise the Applicant of the existence of any such APS; (ii) the Registered Owner, and/or the said mortgagee or other encumbrancer, shall, within three (3) days of the date of this Order, deliver to the Applicant a true and complete copy of the APS together with true and complete copies of any and all amendments to such APS; and (iii) the Applicant shall deliver to the purchaser under the APS, within five (5) days of the Applicant's receipt of a copy of the APS and amendments thereto from the Registered Owner or the mortgagee, a true and complete copy of this Order. If an APS is in existence, then, notwithstanding the terms, conditions and provisions of any such APS, the Director shall have the right, in its sole, absolute and unfettered discretion, to approve or disapprove of the terms and provisions of the transaction contemplated by the APS and any amendments thereto. The Director shall provide notice of its approval or disapproval of the terms of the APS to the Registered Owner and/or the said mortgagee and/or any other encumbrancer, and the purchaser within seven (7) days of receipt of the APS. If the terms and provisions of the APS and any amendments thereto are approved by the Director: (A) the Registered Owner and/or the mortgagee and/or any other encumbrancer, shall complete the transaction contemplated by the APS, and any amendments thereto, in strict accordance with the terms and provisions thereof and with no further amendments being made to the APS which have

not been approved in writing by the Director, which approval may be granted or withheld in the sole and absolute discretion of the Director, and (B) the proceeds of the sale of the Real Property shall be preserved until the final disposition of this Application, or until otherwise ordered by this Court and in accordance with paragraph 21 below. If the terms and provisions of the APS and any amendments thereto are not approved by the Director, the Registered Owner and/or the mortgagee shall not complete the sale of the Property pursuant to the provisions of the APS, as amended from time to time, and the APS shall be terminated forthwith, the deposit shall be returned to the purchaser under the APS, and the Registered Owner and/or the mortgagee and/or other encumbrancer and the purchaser shall execute a full and final release from the APS and any amendments thereto.

21. THIS COURT ORDERS that to preserve the proceeds of any sale of the Real Property contemplated by paragraph 17 of this Order, any proceeds shall be deposited with the Accountant of the Superior Court of Justice in Ontario in an interest-bearing account to the credit of the Application.

Justice of the Superior Court of Justice

Court File No. CV-23-0054-00

Attorney General of Ontario

and

75 River Street, Thunder Bay, Ontario

Or Proceeds of Sale Thereof (in rem

COURT FILE NO.: CV-23-0054-00

DATE: 2023-06-09

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Attorney General of Ontario v. 175 River Street, Thunder Bay, Ontario, or Proceeds of Sale Thereof in Rem

HEARD: June 8, 2023

BEFORE: Nieckarz A/RSJ

COUNSEL: C. Peterson, for the Applicant

Unrepresented, Respondent

ENDORSEMENT

Nieckarz Acting R.S.J.

DATE: June 9, 2023