Court File and Parties

COURT FILE NO.: CV-23-00700440 MOTION HEARD: 20240529

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: HUI CHU HSIEH, MIKE BEER INVESTMENTS INC., MONICA BOROWSKI, PAUL FOREMAN AND OLYMPIA TRUST COMPANY AS TRUSTEES FOR PRASAD CHANDRAKANTHAN and SUGEEVINI CHANDRAKANTHAN, Plaintiffs

AND:

WALIMUNI NALIKA SILVA and RATNAYAKE MUDIYANSELAGE PRAGGNA KEERTHI RATNAYAKE, Defendants

BEFORE: Associate Justice Jolley

COUNSEL: Eden Ifergan, counsel for the moving party defendants Vaishali Patel, counsel for the responding party plaintiffs

HEARD: 29 May 2024

Reasons for Decision

[1] The defendants seek an order on an urgent basis for a 90 day stay of the writ of possession obtained by the plaintiffs on 1 March 2024 over the defendants’ home at 25 Meadowvale Road, Toronto (the “Property”), along with the notice to vacate dated 16 April 2024. During this 90 day temporary stay, the defendants wish to return to the home, which will be their right if the writ is vacated, and to either refinance and pay out the plaintiffs’ mortgage or sell the Property. If they are unable to sell or refinance, they have agreed to voluntarily leave the Property, allow the plaintiffs possession and permit them to sell it.

[2] The defendants do not challenge the judgment obtained by the plaintiffs on 19 July 2023 in the amount of $536,087.07. What they do challenge are the fees that were included in the plaintiffs’ mortgage discharge statement. It is their position that the fees violate section 8 of the Interest Act, R.S.C. 1985, c I-15 and are not recoverable.

[3] The defendants retained their present counsel on 7 May 2024 and obtained this date on an urgent basis on 8 May 2024. They immediately advised the plaintiffs of the date and noted:

“In the face of a scheduled motion it would be my expectation that your clients will not take any further steps to enforce the Writ of Possession and Notice to Vacate, however it would provide greater certainty to our clients and their children if your clients would consent to a stay until May 30, 2024 and we can prepare and have that order taken out in writing before Monday.”

[4] The plaintiffs did not agree and, instead, directed the Sheriff to remove the defendants from the Property on 16 May 2024. Since their eviction, the defendants have been living at a hotel in Ajax.

[5] By way of background, the parties entered into the mortgage on 7 December 2021. The mortgage was in good standing until the defendants’ default in May 2023. They brought the mortgage into good standing in August. They also paid the September and October 2023 mortgage payments. They had tendered the November 2023 mortgage payment but the plaintiffs refused to cash it, taking the position that the discovery of outstanding taxes put the mortgage in default.

[6] In October 2023, while the defendants were making these mortgage payments and the parties were discussing a proposal to bring the property taxes back in good standing, the plaintiffs brought a motion without notice to the defendants for leave to issue the writ of possession. The order was ultimately issued on 27 February 2024 and the writ followed on 14 March 2024.

[7] The defendants attempted to refinance the mortgage around its due date. They argue that, while they had a refinance opportunity in April 2024, they were unable to ultimately obtain that refinancing, as the discharge statement they received from the plaintiffs was grossly inflated with inappropriate charges and fees. I am not in a position on this urgent motion, nor am I asked, to determine whether the fees and charges are valid or offside the legislation.

[8] Unable to refinance in time, on 1 May 2024, the defendants then listed the Property for sale for $1,950,000. They had a number of viewings lined up over the May long weekend but the plaintiffs did not agree to allow the showings to proceed and they had to be cancelled.

[9] In my view, there is no prejudice to the plaintiffs if the temporary stay is allowed. Avison Young appraised the Property at $1,900,000 as of 14 March 2024. It is presently listed for $1,899,999 with instructions to gradually reduce the price, if needed. The plaintiffs do not disagree with the listing price.

[10] With the first mortgage at roughly $865,000 and the plaintiffs’ most recent discharge statement at roughly $583,000, if the Property sells for anything above $1,448,000 (which is 76% of the appraised value), the plaintiffs will be made whole. While they argue that they will continue to be without the judgment and mortgage discharge funds in the interim, any prejudice is greatly mitigated by the post-judgment interest on the judgment of 9.99%.

[11] This temporary stay will also provide a mechanism for the defendants to challenge the fees and charges that the plaintiffs have included in their original and now amended discharge statement. As was noted in Ledroit v Wilson, 2015 ONSC 4997, it may be appropriate to stay a writ of possession to give a defendant an opportunity to determine the appropriate payout amount and then pay what is ordered. A similar result was reached in CMI High Yield Opportunity Fund v Todorov, 2023 ONSC 5697 where the writ of possession was stayed pending determination of the amount of administrative fees due.

[12] The order is granted on the following terms and conditions:

(a) the writ of possession and notice to vacate are stayed for 90 days from the date of this order and the defendants may immediately take possession of the Property;

(b) the defendants shall pay the plaintiffs $4,387.28 upon commencement of occupancy and each month thereafter, which amounts will be accounted for by the plaintiffs either as payment against the Judgment or against the discharge statement;

(c) if the defendants are unable to sell the Property or refinance within the 90 days, they have consented to vacate and voluntarily give possession of the Property to the plaintiffs, without requiring the plaintiffs to incur the cost of a court attendance;

(d) if the Property sells within the 90 days, the defendants shall pay the plaintiffs the Judgment with accrued interest. If the parties agree on the amount due to discharge the mortgage, that amount shall also be paid from the sale proceeds. If they do not agree, the defendants shall hold in trust the amount in dispute pending resolution by agreement or further court order.

[13] The plaintiffs shall pay the defendants their costs of the motion, which I fix on a partial indemnity basis in the all inclusive amount of $7,500.

Associate Justice Jolley Date: 30 May 2024