Labonte v. 539644 Ontario Inc. et al, 2025 ONSC 1574

COURT FILE NO.: CV-23-0225-00
DATE: 2025-03-11
SUPERIOR COURT OF JUSTICE – ONTARIO

RE: Carolle Manon Labonte aka Carolle Manon Brown, Plaintiff (Moving Party)
v.
539644 Ontario Inc., Brian Wayne Whalley, and Aniela Jane Hannaford, Defendants (Responding Party)

HEARD: March 7, 2025
BEFORE: F.B. Fitzpatrick
COUNSEL:

• M. Cupello, for the Moving Party Carolle Manon Labonte (“Labonte”)
• J. Lester, J. Kirk for 539644 Ontario Inc., Brian Wayne Whalley, and Aniela Jane Hannaford (“the Respondents”)

Endorsement on Motion for Partial Summary Judgment

[1] Labonte brings a motion for summary judgment in CV-23-00225. I have been case managing this action and a related matter, CV-23-0193 (where the Respondents are the plaintiffs) since April 2024. The notice of motion served, filed, and uploaded in Case Centre sought the following elements of relief:

1. an order for sale of a commercial resort property owned by the Respondents (which property I will hereafter refer to as “Browns”) that is the subject of the two actions and an order that the proceeds be applied to a vendor take back mortgage (the Mortgage) on Browns in favour of Labonte;
2. an order for possession of Browns;
3. an order that the Respondents pay to Labonte the sum of $2,259,471.00 due under the Mortgage together with interest at the rate of two percent per year from February 21, 2025 until Judgment. [Emphasis added]

[2] The last term in point 3, above, which reads “until Judgment”, was confusing to the Court. As was the alternative relief also claimed in the notice of motion which read as follows:

In the alternative, payment by the Defendants and the added Party Defendant to the Plaintiff of the sum of $100,000.00 representing the arrears of monthly mortgage payments since October 1, 2024 up to and including the monthly mortgage payment due February 1, 2025, together with interest on the said arrears at the rate of 2 percent (Mortgage Rate) per year, as calculated from March 25, 2024, within a period of thirty (30) days failing which all Orders requested by the Plaintiff shall issue…

[3] Labonte originally served and filed a motion for summary judgment requesting similar relief noted above in respect of the Mortgage on March 25, 2024. It was shortly followed up by Labonte serving a notice of sale in respect of the Mortgage. This was met by a motion requesting Labonte be enjoined from proceeding to enforce the notice of sale. I made an endorsement on June 7, 2024, in Labonte et al v. 539644 Ont. Inc. et al, Browns Clearwater v. Labonte et al, 2024 ONSC 3278, in which I set out the background of this file at paras. 2 and 3, also relying on the history as recited by Fregeau J. at paras. 2–16 of Brown’s Clearwater West Lodge Inc. v. Labonte et al, 2023 ONSC 5337. The background facts need not be repeated. It is a commercial matter, and interpretation of a 3.1-million-dollar contract is front and centre in the litigation.

[4] There is no dispute that the Respondents have ceased making the regular monthly payments on the Mortgage. There is no dispute that there are substantial arrears owing. The Respondents assert that they are relieved from making the ongoing payments as the result of a contractual right to set off amounts owed by Labonte to them, contained in the agreement of purchase and sale that led to their acquisition of Browns in 2021. The Respondents have not waivered in this position since I began case managing this matter.

[5] At the opening of submissions on March 7, 2025, counsel for Labonte indicated that the moving party would only be seeking the “alternate relief” on the motion. Counsel could not provide an exact amount for the partial summary judgment sought. Counsel indicated it was a rough number of approximately $139,000.00.

[6] This submission caught the Court by surprise.

[7] On the motion bundle in Case Centre, there had been extensive materials filed by both parties; five affidavits on behalf of the moving party, three affidavits and an expert report on behalf of the Respondents, and the transcripts of cross examinations on the affidavits of Labonte and Jane Hannaford. Both parties filed lengthy facta, all of which were focused on a motion for summary judgment seeking sale, possession of Browns and judgment in full on the Mortgage.

[8] Argument proceeded for the balance of the day. At approximately 3:00 p.m., in the course of reply argument, counsel for Labonte asserted three times that the matter was actually a motion for partial summary judgment.

[9] The Court then referred counsel to paras. 61–62 of the Court of Appeal decision in Malik v. Attia, 2020 ONCA 787, where Brown J.A. states the following:

[61] Yet, the risk of inconsistent findings is only one of several matters that a motion judge must consider when asked to entertain a motion for partial summary judgment. Reduced to its essence, the decision in Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87 promoted summary judgment as a procedural tool that offers the prospect, when used in the right circumstances, to provide litigants with timely and affordable access to the civil court system: at paras. 2-5. Given that simple objective, before embarking on hearing a motion for partial summary judgment a motion judge must determine whether, in the circumstances, partial summary judgment will achieve the objectives of proportionate, timely, and affordable justice or, instead, cause delay and increase expense.

[62] When faced with a request to hear a motion for partial summary judgment, a motion judge should make three simple requests of counsel or the parties:

(i) Demonstrate that dividing the determination of this case into several parts will prove cheaper for the parties;

(ii) Show how partial summary judgment will get the parties' case in and out of the court system more quickly;

(iii) Establish how partial summary judgment will not result in inconsistent findings by the multiple judges who will touch the divided case. [Citations omitted].

[10] I proceeded to make these three simple requests of the parties.

[11] Counsel for Labonte asserted that his, now partial summary judgment motion, would make the litigation cheaper for the parties, would move the case in and out of the court system more quickly, and asserted that as the set off argument of the Respondents had no merit based on the facts of the case, there was no risk that granting the partial summary judgment would result in inconsistent findings by another judge who would try the case, as it would encourage the Respondents to settle before trial.

[12] Counsel for the Respondents argued that this entire motion was a waste of the parties and the Court’s time. In fact, an entire year had been wasted since Labonte first brought forward the summary judgment motion. The issue of the right to set off cannot be bifurcated from the obligation to pay the ongoing monthly payments. This reality was recognized by the judgment of Fregeau J., noted above, which determined that the provisions of Rule 6.01(1)(a) and (b) were met in that the two matters had questions of law and fact in common and the relief claimed arose out of the same transaction or series of transactions. The actions were accordingly consolidated.

[13] Fregeau J. made this order in September 2023.

[14] I am persuaded by the arguments of the Respondents that this is not an occasion where partial summary judgment is warranted. I agree with counsel that this entire summary judgment process has been a waste of time.

[15] Attempts to resolve the matter through the case management process have been unsuccessful from April 2024 to date. During the process, counsel for Labonte was adamant that the summary judgment motion be scheduled at the earliest possible date. This request was made in the face of well-known difficulties the court in the Northwest region was having due to a decreased judicial complement and a marked increase in criminal matters. Thunder Bay is currently number two in per capita violent crimes in Canada. Not something we are proud of, but a reality that greatly impacts the deployment of judicial resources.

[16] The Court takes requests of counsel seriously when they are advocating for their clients and pressing for hearing dates, particularly for time that will take up an entire court day. The court schedule was rearranged to accommodate the hearing of this matter. However, in my view the “opening sequence switch” to a partial summary judgment by Labonte was not the most proportionate, timely, and affordable way to resolve this matter, given all that had come before.

[17] I agree with counsel for the Respondents that this has wasted an entire year of the litigants’ time. Labonte took the very serious step of serving a notice of sale and a demand for possession of a commercial property. This would have significant impacts on the lives and business of the Respondents. Labonte did not follow through on the request to have this process move forward today. This attendance was a complete waste of time.

[18] Now, having the benefit of the Respondent’s expert report, I can see that there is a genuine issue for trial concerning the entitlement and quantum of damages the Respondents assert are owed to them by Labonte. While I was not completely comfortable with some of the “evidence” asserted in the affidavit of solicitor Ritson filed on this matter, as it appeared to suggest conclusions that are the sole purview of the court, there is no question that formation of the contract and the meaning of the set off clause is a genuine issue for trial.

[19] In my view, Labonte, as the moving party, has failed to demonstrate that dividing the determination of this case into several parts will prove cheaper for the parties. Labonte has failed to show how granting partial summary judgment will get the parties' case in and out of the court system more quickly. In fact, it has delayed the progress of the case moving to trial for about eighteen months.

[20] Labonte has also failed to establish how partial summary judgment will not result in inconsistent findings by trial judge who will hear the case. The Respondents assert that they are owed over 1 million dollars. While this is less than the amount of the principal advanced on the Mortgage, the initial term of the Mortgage ended in July 2025, where I expect the parties originally anticipated that the Respondents would refinance. There is a possibility that the trial judge will agree with the Respondents and find that Labonte owes the Respondents an amount in excess of what they have paid on the Mortgage, or would owe in arrears, as of the trial date.

[21] For these reasons the motion for summary judgment and partial summary judgment are dismissed.

[22] Also, in my capacity as case management judge, I order that Labonte is hereby enjoined from taking any further steps to enforce the Notice of Sale under Mortgage and Demand for Possession dated April 25, 2024. In my view, the decision not to pursue the primary relief in the summary judgment notice of motion that was served and formed the basis of the written materials filed recognizes that any extra judicial remedies should not be permitted to be pursued until further court order. In my view, this obviates the need for any further motion attendances by these parties arising out of this motion or the motion for an injunction brought by the Respondents, which was initially heard June 6, 2024.

[23] Labonte decided to proceed in a particular way on this date reserved for an all day summary judgment motion. Motions for summary judgment are a tool designed to significantly advance, or even finish, litigation. Labonte’s submissions today were not sufficient to persuade me to grant the partial summary judgment sought. This motion day did not serve to advance the matter to trial.

[24] The result on this motion calls for Labonte to pay costs to the Respondents. However, I note that neither party filed a Bill of Costs on this motion. Neither did they prepare a compendium for use on this motion. Neither facta was hyperlinked. There were 23 separate documents in the bundle for Labonte and 75 documents for the Respondents. Some of these documents were copies of authorities. Lacking a compendium, the utility of the Case Centre platform was diminished for this matter. The lack of hyperlinks and compendium from either party made this document-heavy case even more difficult to navigate for the Court. This will serve to reduce the quantum of costs that I am prepared to award the Respondents.

[25] If costs are not agreed, the Respondents shall serve on Labonte and upload to Case Centre in the Motion on Notice bundle a request for costs consisting of no more than two pages on or before March 28, 2025. Labonte shall serve a response to the request and upload same to Case Centre in the Motion on Notice bundle consisting of no more than two pages on or before April 11, 2025. In the event there were relevant Rule 49-compliant offers to settle exchanged on this motion, they may be attached to the submission. Failure to meet the deadlines will result in the particular submissions not being considered. Failure to honour the two-page limit means any pages in excess of the limit will not be reviewed.

[26] In light of these observations concerning the presentation of the case, I expect the quantum of costs claimed by the Respondents will be moderate.

[27] Both counsel indicated in the course of their submissions that they were open to an expedited trial schedule. Counsel are invited to schedule a further case conference within 60 days of the release of my decision on costs in order to discuss said expedited schedule. On that conference, I will expect the parties to put together a realistic written schedule taking into the account the court’s running list model for trial of this matter.

“original signed by” F.B. Fitzpatrick
DATE: March 11, 2025