Regular court operations and limitation periods/statutory deadlines continue to be suspended in Ontario due to COVID-19 (as discussed further in my previous blog). However, this does not mean that litigation is somehow frozen or that deadlines in previous court orders do not apply. One party learned this painful lesson in Lima v. Ventura (Estate of), 2020 ONSC 3278.
The facts in this case are depressingly common in Toronto. A deceased dies with only one significant asset: a family home. One (or more) beneficiaries resides in the home and wants to continue the status quo. The other beneficiaries, by contrast, want the home sold.
Here, the respondent and his family reside in the family home. His siblings (the applicants) brought an application to have the home sold (and other relief). Before COVID-19, the respondent consented to an order that he could purchase the home until April 14, 2020 at a price to be agreed upon. If he did not do so, the home would be listed for sale. Due to COVID-19, he brought a motion to extend the time for him to purchase the home (and a corresponding extension for the time the home would be sold). The applicants (the respondents’ siblings) brought a cross-motion to proceed with listing the home for sale and the payment of occupation rent from the respondent.
The respondent took the position that he maintained his intention to purchase the home. However, due to COVID-19 his real estate agent could not value the property (which was needed to obtain financing). Additionally, banks and municipal departments had been ordered closed which further stymied him. He would be prejudiced if he was forced to move during the COVID-19 pandemic.
The applicants’ view was that the respondent had not actually produced any evidence in support of his claims, only bald assertions. They queried whether his ability to obtain financing was chimerical, given that he provided no financial disclosure.
Justice Emery found that he could not make any credibility determinations between the parties based on the written record. However, his Honour determined that, generally speaking, he did not need to make factual findings between the parties. Court orders are not suggestions, they must be followed. In order for the respondent to relieve himself of compliance with the court order regarding the sale the respondent needed to provide “persuasive evidence.” Justice Emery found that the respondent failed to do so.
While his Honour took judicial notice that banks and governments were not operating at full capacity, he also took judicial notice that many sectors were working remotely. The respondent provided no evidence he attempted to meet his obligations under the order by electronic means. If the respondent could not get a valuation from his real estate agent, he should have selected a new one. Or he could have applied online for financing. Instead, he did nothing.
Finally, Justice Emery rejected the respondent’s position that he would suffer prejudice if he was forced to move, as there also no evidence of this.
As such, his Honour rejected the respondent’s motion and ordered that the home be sold. The applicants had sole carriage of the sale and could take any step to implement it (although probate has not been granted). Additionally, his Honour ordered the respondent to vacate the home in advance of the closing date, he did not make an order for a writ of possession (i.e. a direction that the police could be used to expel the respondent from the home if he did not leave voluntarily) as this relief was not expressly sought.
Finally, his Honour turned to the issue of occupation rent. Occupation rent arises where there is no formal tenancy but a party has been unjustly enriched by being able to reside in a property. There was no evidence that the respondent paid expenses to maintain the home (in fact, he admitted not paying property taxes). As such, his Honour fixed occupation rent at 2/3rds of fair market rent for the area, to be paid to applicants’ lawyers in trust.
There are many lessons to take from this case. The most obvious is that court orders and court ordered timetables remain in effect during the pandemic and parties ignore this at their peril. The case also demonstrates why a full evidentiary record is so important. Courts will not simply accept statements that a person moving during COVID-19 will be prejudiced; evidence must be provided. Finally, the case shows that the relief sought in a notice of motion is key. Here, the applicants may ultimately run into difficulties in ejecting the respondent from the home due to the fact that no writ of possession was sought. Additionally, there may be issues with selling the home due to the fact that there is no probate certificate and no vesting order. Hopefully, the issues can be resolved without another return to court.