Edenrock Holdings Inc. v. Moscone, 2025 ONSC 32

COURT FILE NO.: CV-23-697149 and CV-24-716711
DATE: 2025-01-03
SUPERIOR COURT OF JUSTICE - ONTARIO

Parties

Applicants:
Vincent Moscone, Anna Moscone, Laura Moscone, Vetta Corp., Benar Holdings Inc., and Wilsonhall Properties Inc.

Respondents:
Edenrock Holdings Inc. and Anthony Marrese

AND BETWEEN:
Edenrock Holdings Inc. and Anthony Marrese, Applicants
and
Vincent Moscone, Anna Moscone, Laura Moscone, Vetta Corp., Benar Holdings Inc., and Wilsonhall Properties Inc., Respondents

BEFORE: Anand Prabhat Parghi

COUNSEL:
Enzo Di Iorio and Gleb Matushansky, for the Applicants/Respondents, Vincent Moscone, Anna Moscone, Laura Moscone, Vetta Corp., Benar Holdings Inc., and Wilsonhall Properties Inc.
Maurice Neirinck, for the Respondents/Applicants, Edenrock Holdings Inc. and Anthony Marrese

HEARD: 2024-11-26

Endorsement

[1] The Applicants Vincent Moscone, Anna Moscone, Laura Moscone, Vetta Corp. (“Vetta”), Benar Holdings Inc. (“Benar”), and Wilsonhall Properties Inc. (“Wilsonhall”) seek an order setting aside two arbitral decisions of the Honourable Justice Blair (the “Arbitrator”). These consist of a substantive decision dated February 8, 2023 (the “Decision”) and a related costs decision dated April 5, 2023 (the “Costs Decision”). In the alternative, these Applicants, to whom I will refer as the Moscone Parties, seek leave to appeal the Decision and Costs Decision (together, the “Decisions”) on questions of law. In the further alternative, they ask that the matter be remitted to a new arbitrator for consideration and that the court provide its opinion on the questions of law raised in the matter together with directions for re-determination.

[2] The Respondents to the Moscone Parties’ application, Edenrock Holdings Inc. (“Edenrock”) and Anthony Marrese, bring their own application to enforce the Decisions.

[3] For the reasons below, I dismiss the Moscone Parties’ application and grant the application by Edenrock and Anthony Marrese to enforce the Decisions. There is no basis on which to set aside the Decisions. Nor is there a basis for granting leave to appeal: the arbitration agreement extinguishes all rights of appeal, the orders sought to be appealed do not raise questions of law, and in any event the test for leave to appeal on a question of law is not met.

Background

[4] For the purposes of my analysis, I need only describe the relationships among the parties at a high level. Moscone Tile (whose principals are Vincent Moscone, Anna Moscone, and Laura Moscone) and Moscone Marble (whose principal is Anthony Marrese) are co-tenants in a commercial property owned by Wilsonhall. They share warehouse space and a showroom for their respective products. Since 2020, the parties have conducted several arbitrations before the Arbitrator on a range of issues between Moscone Tile and Moscone Marble, including the allocation of rent for the showroom, the allocation of display--- citation: "Edenrock Holdings Inc. v. Moscone, 2025 ONSC 32" parties: "Edenrock Holdings Inc. and Anthony Marrese v. Vincent Moscone, Anna Moscone, Laura Moscone, Vetta Corp., Benar Holdings Inc., and Wilsonhall Properties Inc." party_moving: "Edenrock Holdings Inc. and Anthony Marrese" party_responding: "Vincent Moscone, Anna Moscone, Laura Moscone, Vetta Corp., Benar Holdings Inc., and Wilsonhall Properties Inc." court: "Superior Court of Justice" court_abbreviation: "ONSC" jurisdiction: "Ontario" case_type: "appeal" date_judgement: "2025-01-03" date_heard: "2024-11-26" applicant:

• "Vincent Moscone"
• "Anna Moscone"
• "Laura Moscone"
• "Vetta Corp."
• "Benar Holdings Inc."
• "Wilsonhall Properties Inc."
• "Edenrock Holdings Inc."
• "Anthony Marrese" applicant_counsel:
• "Enzo Di Iorio"
• "Gleb Matushansky"
• "Maurice Neirinck" respondent:
• "Vincent Moscone"
• "Anna Moscone"
• "Laura Moscone"
• "Vetta Corp."
• "Benar Holdings Inc."
• "Wilsonhall Properties Inc."
• "Edenrock Holdings Inc."
• "Anthony Marrese" respondent_counsel:
• "Enzo Di Iorio"
• "Gleb Matushansky"
• "Maurice Neirinck" judge: "Anand Prabhat Parghi" year: 2025 decision_number: 32 file_number: "CV-23-697149 and CV-24-716711" source: "https://www.canlii.org/en/on/onsc/doc/2025/2025onsc32/2025onsc32.html" cited_cases: legislation:
  • title: "Arbitration Act, 1991, SO 1991, c 17" url: "https://www.ontario.ca/laws/statute/91a17" case_law:
  • title: "Baffinland Iron Mines LP v. Tower-EBC G.P./S.E.N.C., 2023 ONCA 245, para 42" url: "https://www.canlii.org/en/on/onca/doc/2023/2023onca245/2023onca245.html#par42" summary: > This decision concerns cross-applications to set aside or enforce two arbitral decisions relating to a commercial property dispute between the Moscone Parties and Edenrock Holdings Inc. and Anthony Marrese. The Moscone Parties sought to set aside or appeal the arbitral decisions on grounds of procedural unfairness, natural justice, and bias, or in the alternative, to remit the matter to a new arbitrator. The court dismissed the Moscone Parties’ application, finding no breach of natural justice or procedural fairness, no reasonable apprehension of bias, and that the arbitration agreement precluded any right of appeal. The application by Edenrock and Marrese to enforce the arbitral decisions was granted. interesting_citations_summary: > The decision is notable for its clear application of the finality of arbitral awards under Ontario’s Arbitration Act, 1991, and its discussion of the limits of judicial intervention in arbitral proceedings. The court’s analysis of the parties’ procedural rights and the threshold for setting aside arbitral awards provides useful guidance for commercial arbitration practice. keywords:
• Arbitration
• Procedural fairness
• Natural justice
• Bias
• Commercial property
• Arbitral award
• Ontario Arbitration Act
• Finality of arbitration
• Leave to appeal
• Enforcement of arbitral awards areas_of_law:
• Civil Procedure
• Arbitration
• Commercial Law

Edenrock Holdings Inc. v. Moscone, 2025 ONSC 32

COURT FILE NO.: CV-23-697149 and CV-24-716711
DATE: 2025-01-03
SUPERIOR COURT OF JUSTICE - ONTARIO

Parties

Applicants:
Vincent Moscone, Anna Moscone, Laura Moscone, Vetta Corp., Benar Holdings Inc., and Wilsonhall Properties Inc.

Respondents:
Edenrock Holdings Inc. and Anthony Marrese

AND BETWEEN:
Edenrock Holdings Inc. and Anthony Marrese, Applicants
and
Vincent Moscone, Anna Moscone, Laura Moscone, Vetta Corp., Benar Holdings Inc., and Wilsonhall Properties Inc., Respondents

BEFORE: Anand Prabhat Parghi

COUNSEL:
Enzo Di Iorio and Gleb Matushansky, for the Applicants/Respondents, Vincent Moscone, Anna Moscone, Laura Moscone, Vetta Corp., Benar Holdings Inc., and Wilsonhall Properties Inc.
Maurice Neirinck, for the Respondents/Applicants, Edenrock Holdings Inc. and Anthony Marrese

HEARD: 2024-11-26

Endorsement

[1] The Applicants Vincent Moscone, Anna Moscone, Laura Moscone, Vetta Corp. (“Vetta”), Benar Holdings Inc. (“Benar”), and Wilsonhall Properties Inc. (“Wilsonhall”) seek an order setting aside two arbitral decisions of the Honourable Justice Blair (the “Arbitrator”). These consist of a substantive decision dated February 8, 2023 (the “Decision”) and a related costs decision dated April 5, 2023 (the “Costs Decision”). In the alternative, these Applicants, to whom I will refer as the Moscone Parties, seek leave to appeal the Decision and Costs Decision (together, the “Decisions”) on questions of law. In the further alternative, they ask that the matter be remitted to a new arbitrator for consideration and that the court provide its opinion on the questions of law raised in the matter together with directions for re-determination.

[2] The Respondents to the Moscone Parties’ application, Edenrock Holdings Inc. (“Edenrock”) and Anthony Marrese, bring their own application to enforce the Decisions.

[3] For the reasons below, I dismiss the Moscone Parties’ application and grant the application by Edenrock and Anthony Marrese to enforce the Decisions. There is no basis on which to set aside the Decisions. Nor is there a basis for granting leave to appeal: the arbitration agreement extinguishes all rights of appeal, the orders sought to be appealed do not raise questions of law, and in any event the test for leave to appeal on a question of law is not met.

Background

[4] For the purposes of my analysis, I need only describe the relationships among the parties at a high level. Moscone Tile (whose principals are Vincent Moscone, Anna Moscone, and Laura Moscone) and Moscone Marble (whose principal is Anthony Marrese) are co-tenants in a commercial property owned by Wilsonhall. They share warehouse space and a showroom for their respective products. Since 2020, the parties have conducted several arbitrations before the Arbitrator on a range of issues between Moscone Tile and Moscone Marble, including the allocation of rent for the showroom, the allocation of display space in the showroom, the allocation of charges for exterior water use, and the costs of repairing of an elbow pipe (a storm water pipe located under the floor of the Moscone Marble warehouse space).

[5] The Moscone Parties now ask that I set aside or grant leave to appeal the following awards from the Decision:

a. An order dismissing a rent adjustment claim sought by Vincent Moscone, Anna Moscone, Laura Moscone, Vetta, and Benar, and ordering Moscone Tile to pay Wilsonhall additional rent (the “rent adjustment award”);

b. An order requiring Vincent Moscone, Anna Moscone, Laura Moscone, Vetta, and Benar to remove five Moscone Tile tower displays encroaching on a shared walkway in the showroom (the “display tower award”);

c. An order requiring Vincent Moscone, Anna Moscone, Laura Moscone, Vetta, and Benar to remove Moscone Tile displays that currently form a wall around the perimeter of part of the showroom (the “display wall award”); and

d. An order requiring Wilsonhall to reimburse Moscone Marble for exterior water use (the “exterior water award”).

[6] Additionally, the Moscone Parties ask that I set aside or grant leave to appeal the Costs Decision.

Application to Set Aside the Decisions

[7] The Moscone Parties’ request to set aside the Decisions is grounded in s. 46(1) of the Arbitration Act, 1991, SO 1991, c 17 (the “Act”), which provides in relevant part:

On a party’s application, the court may set aside an award on any of the following grounds:

6. The applicant was not treated equally and fairly, [or] was not given an opportunity to present a case or to respond to another party’s case.

7. An arbitrator has committed a corrupt or fraudulent act or there is a reasonable apprehension of bias.

[8] The Moscone Parties also point to s. 19 of the Act, which provides that each party is to have the opportunity to present their case and respond to the other’s case, failing which there may be a breach of natural justice.

[9] The Moscone Parties argue that in rendering the Decisions, the Arbitrator violated their rights to procedural fairness and natural justice in three ways.

Natural Justice and the Exterior Water Award

[10] First, the Moscone Parties say that the Arbitrator treated them unfairly by not allowing them to make submissions on the claims relating to exterior water charges and the elbow pipe. Counsel advise that the elbow pipe issue is now resolved, and as such I will focus on the exterior water claim and resulting exterior water award.

[11] The Arbitrator had issued a ruling in September 2022 that contained a schedule for the parties to make their submissions on the exterior water claim. It is uncontested that the Moscone Parties advised that they would not make substantive arguments, because they did not attorn to the jurisdiction of the Arbitrator in respect of the exterior water claim. In the result, the Arbitrator decided the claims based on the materials that did not include any submissions from the Moscone Parties.

[12] The Moscone Parties take the view that it was improper for the Arbitrator to have done so. They say that once the Arbitrator decided he had jurisdiction over the exterior water claim, he should have gone back to them and invited them to make submissions before rendering the Decision. By not doing so, he denied them natural justice.

[13] I do not agree. The principles of natural justice and ss. 19 and 46(1) of the Act require that the Moscone Parties be afforded the opportunity to make submissions. The Moscone Parties were in fact afforded this opportunity, through the timetable established by the Arbitrator. They chose not to make submissions. By doing so, they declined the opportunity afforded to them by the Arbitrator.

[14] The Moscone Parties made a choice as to how to proceed. They could have instead chosen to make substantive submissions on the exterior water claim in the alternative to their primary submission that the Arbitrator lacked jurisdiction to address the claim. Indeed, they had done exactly that in the past, in relation to a rent dispute before the Arbitrator. They did not do so here. Nor did they ask that the issue of jurisdiction be addressed first and reserve the right to make substantive submissions in the event the Arbitrator determined he had jurisdiction. Nor did they rely on s. 44 of the Act to ask the Arbitrator to reopen the matter after the Decision was handed down, to give them a chance to make substantive submissions at that stage.

[15] In my view, there was no obligation on the Arbitrator to extend to the Moscone Parties a second opportunity to make submissions after they expressly declined the first opportunity. No authority is provided to me in support of the Moscone Parties’ submission to the contrary. I find that it was reasonable and appropriate, and consistent with the September 2022 ruling, for the Arbitrator to have made the Decision based on the materials before him.

Reopening of Earlier Decisions and the Display Wall and Rent Adjustment Awards

[16] Second, the Moscone Parties submit that the Arbitrator treated them unfairly by re-opening and re-interpreting his earlier awards when he handed down the display wall award and rent adjustment award.

[17] Having regard to the display wall award, the Moscone Parties say that the Arbitrator found that even though the Moscone Parties had complied with his December 2021 award, they had violated the “purpose, spirit, and intention” of that award. They say that this finding represents an unfair re-opening of the December 2021 award that introduced new, and subjective, criteria, resulting in prejudice to them.

[18] I do not agree. The Moscone Parties’ submission is grounded in a selective and incorrect reading of the Decision. In fact, the Arbitrator described the Moscone Parties’ placement of the display wall as “wholly antithetical to the model provided for” in his December 2021 decision. He held that the Moscone Parties had violated the “purpose, spirit, and intention” of the December 2021 decision. Importantly, he went on, in the same sentence, to find that they had also violated the actual substantive terms of the December 2021 decision:

[Moscone Tile’s] placement of the Tile wall displays around Area A … is not only contrary to the purpose, spirit, and intention of the December 2021 Award; it is contrary to the terms of that Award as well.

[19] It is clear that the Arbitrator held that Moscone Tile’s erection of the display wall was contrary to the terms (and not just the “purpose, spirit, and intention”) of the December 2021 decision. The Moscone Parties’ assertion to the contrary is predicated on a partial reading of this sentence. It is untenable.

[20] Having regard to the rent adjustment award, the Moscone Parties say that the Arbitrator unfairly excluded their claim for back rent prior to October 2020. In doing so, they say, he introduced a new bright line rule that was inconsistent with, and effectively reopened, his earlier decisions, denying them procedural fairness.

[21] I am unable to agree. The rent adjustment award may be understood only with reference to the Arbitrator’s October 2020 decision, which fixed the leasable space used by Moscone Marble and Moscone Tile, both alone and together as shared space. The October 2020 decision, together with a subsequent email sent by the Arbitrator to counsel, made clear that the adjusted rent payments made by Moscone Marble and Moscone Tile, flowing from the adjusted space allocations fixed by the October 2020 decision, were to take effect on a go-forward basis starting on October 1, 2020. The Moscone Parties did not appeal the October 2020 decision.

[22] The Arbitrator thus did not establish a new, and unsupported, bright line cutoff of October 1, 2020 in the Decision, as the Moscone Parties claim. To the contrary, he referred to and reiterated the October 1, 2020 date established in the October 2020 decision. He relied on it as the basis for denying the Moscone Parties’ request, holding that the terms of the October 2020 decision were “dispositive” of the Moscone Parties’ claim for pre-October 2020 rent adjustments. I do not agree that the Arbitrator created a new bright line cutoff that unfairly precluded the Moscone Parties’ claim. To the contrary, he invoked, applied, and enforced the October 2020 award.

Bias

[23] Third, the Moscone Parties state that the Arbitrator’s conduct gives rise to a reasonable apprehension of bias against them, and that the Decisions should therefore be set aside pursuant to s. 46(1) 8. The conduct to which the Moscone Parties point in support of this argument is discussed above: the Arbitrator’s assumption of jurisdiction over the exterior water claim, his making a decision on that issue in the absence of submissions from the Moscone Parties, his approach to the rent adjustment issue, his alleged reliance on the Moscone Parties’ violation of the “purpose, spirit, and intention” of a previous decision, and his “attempting to re-design” the showroom leaving “no other place for [the Moscone Parties] to put their displays.”

[24] For the reasons discussed above, I do not accept these arguments substantively. It follows that I do not accept them as the foundation of a claim of bias.

[25] The Moscone Parties ground their complaint of bias in the Arbitrator’s substantive findings. When asked to articulate their claim of bias, they say that the way in which he made his findings reveals bias. They cannot persuasively explain how or why this is. They offer no real grounds and no real evidence for the claim of bias.

Conclusion on Setting Aside

[26] Based on the above analysis, I reject the Moscone Parties’ request to set aside the Decisions. There is no basis for setting aside the Decision. Accordingly, there is no basis for setting aside the Costs Decision.

Application for Leave to Appeal the Decisions

[27] The Moscone Parties state in the alternative that they should be granted leave to appeal the Decisions because the Arbitrator made errors in law. Their request for leave to appeal is grounded in s. 45(1) of the Act, which provides that if an arbitration agreement “does not deal with appeals on questions of law,” a party may appeal on a question of law only with leave, which the court will grant only if it is satisfied that “(a) the importance to the parties of the matters at stake in the arbitration justifies an appeal; and (b) determination of the question of law at issue will significantly affect the rights of the parties.”

No Right of Appeal from the “Final and Binding” Decision of the Arbitrator

[28] I find that the arbitration agreement ousts all rights of appeal. It provides that any decision of the Arbitrator “shall be final and binding upon all of the parties” to the dispute and “there shall be no appeal therefrom”. In my view, this language of finality is unequivocal and does not allow for any appeal of any issue, including a question of law (Baffinland Iron Mines LP v. Tower-EBC G.P./S.E.N.C., 2023 ONCA 245, para 42).

No Questions of Law

[29] In any event, the issues in respect of which leave is sought are not questions of law.

[30] As discussed above, I find that the rent adjustment award applied and enforced the Arbitrator’s October 2020 decision.

[31] I likewise find that the display wall award applied and enforced the Arbitrator’s December 2021 decision: the Arbitrator found that the Moscone Parties’ placement of the display wall was contrary to the terms of the December 2021 decision and that the display wall had to be removed to ensure compliance with that decision.

[32] Similarly, I find that the display tower award applied and enforced the December 2021 decision. This is clear from the Arbitrator’s reasoning in the Decision, which cites the language of the December 2021 decision, finds that the placement of the display towers in the designated shared walkway does not comply with the requirements of that decision, and orders that the display towers “be removed completely, and immediately”.

[33] All three awards are thus enforcement orders. They mandate compliance with the Arbitrator’s previous orders. They cannot reasonably be characterized as determinations on questions of law.

No Basis for Granting Leave to Appeal on Any Questions of Law

[34] Even if the arbitration agreement is considered to be silent on the issue of appeals on questions of law, and even if these are questions of law, as the Moscone Parties assert, the test for granting leave to appeal is not made out. I am not satisfied that the importance to the parties of the matters at stake in the arbitration justifies an appeal. The amounts of rent in dispute are agreed by both parties to be modest. The display issues entail moving five display towers so that they no longer encroach on a shared walkway, and removing a display wall, the placement of which the Arbitrator found to be in clear breach of his previous orders. It is, respectfully, difficult to see how these issues rise to the level of importance that would justify an appeal. For the same reasons, it is difficult to see how determining the questions at issue – even if they are questions of law – will affect the rights of the parties in a way that is significant enough to support granting leave.

Conclusion on Leave to Appeal

[35] I find that the arbitration agreement treats the Arbitrator’s decisions as final and affords no rights of appeal. As such, there is no right of appeal in respect of the Decisions. In the alternative, I find that the issues in respect of which leave to appeal is sought are not questions of law and in any event do not satisfy the test for granting leave to appeal on a question of law.

Application to Remit to New Arbitrator

[36] In the further alternative, the Moscone Parties request that the matter be remitted to a new arbitrator for consideration and that I provide my opinion on the questions of law raised in the matter together with directions for re-determination. This request is grounded in s. 45(5) of the Act.

[37] For the reasons discussed above, I am of the view that there are no questions of law raised in the matter. I therefore do not grant this request.

Order Granted

[38] The Moscone Parties’ application is dismissed. The application by Edenrock and Anthony Marrese to enforce the Decisions is granted.

[39] If the parties are unable to agree on costs from the applications, they may provide me with written cost submissions of no longer than four pages by January 22, 2025.

[40] Edenrock and Anthony Marrese are asked to share with the Moscone Parties, and provide to my judicial assistant, a revised form of Judgment that removes reference to the elbow pipe issue, which was not before me during the hearing. They are to do so by January 15, 2025. If the Moscone Parties are of the view that the revised form of Judgment does not accurately capture the substance of the Decisions, they may request a case conference via email to my judicial assistant, by January 22, 2025. If I do not hear from the Moscone Parties by January 22, 2025, I will take it to mean that they are content with the revised form of Judgment provided to me by Edenrock and Anthony Marrese.

Anand Prabhat Parghi
Date: January 3, 2025