Notice of Application (Commercial Tenancies)

R.R.O. 1990, Reg. 194: RULES OF CIVIL PROCEDURE

14.02 Every proceeding in the court shall be by action, except where a statute or these rules provide otherwise. R.R.O. 1990, Reg. 194, r. 14.02.

14.05 (1) The originating process for the commencement of an application is a notice of application (Form 14E, 14E.1, 68A or 73A) or an application for a certificate of appointment of an estate trustee (Form 74.4, 74.5, 74.14, 74.15, 74.21, 74.24, 74.27 or 74.30). R.R.O. 1990, Reg. 194, r. 14.05 (1); O. Reg. 484/94, s. 5; O. Reg. 43/14, s. 5 (1).

(1.1) Form 14F (Information for court use) shall be filed together with a notice of application in Form 14E, 14E.1, 68A or 73A. O. Reg. 260/05, s. 2; O. Reg. 43/14, s. 5 (2).

(2) A proceeding may be commenced by an application to the Superior Court of Justice or to a judge of that court,if a statute so authorizes. R.R.O. 1990, Reg. 194, r. 14.05 (2); O. Reg. 292/99, s. 1 (2).

(3) A proceeding may be brought by application where these rules authorize the commencement of a proceeding by application or where the relief claimed is,

(a) the opinion, advice or direction of the court on a question affecting the rights of a person in respect of the administration of the estate of a deceased person or the execution of a trust;

(b) an order directing executors, administrators or trustees to do or abstain from doing any particular act in respect of an estate or trust for which they are responsible;

(c) the removal or replacement of one or more executors, administrators or trustees, or the fixing of their compensation;

(d) the determination of rights that depend on the interpretation of a deed, will, contract or other instrument, or on the interpretation of a statute, order in council, regulation or municipal by-law or resolution;

(e) the declaration of an interest in or charge on land, including the nature and extent of the interest or charge or the boundaries of the land, or the settling of the priority of interests or charges;

(f) the approval of an arrangement or compromise or the approval of a purchase, sale, mortgage, lease or variation of trust;

(g) an injunction, mandatory order or declaration or the appointment of a receiver or other consequential relief when ancillary to relief claimed in a proceeding properly commenced by a notice of application;

(g.1) for a remedy under the Canadian Charter of Rights and Freedoms; or

(h) in respect of any matter where it is unlikely that there will be any material facts in dispute requiring a trial. R.R.O. 1990, Reg. 194, r. 14.05 (3); O. Reg. 396/91, s. 3; O. Reg. 537/18, s. 2.

RULE 38 APPLICATIONS — JURISDICTION AND PROCEDURE

APPLICATION OF THE RULE

38.01 (1) Rules 38.02 to 38.12 apply to all proceedings commenced by a notice of application under rule 14.05, subject to subrules (2) and (3). O. Reg. 43/14, s. 8 (1).

(2) Rules 38.02 and 38.09 do not apply to applications to the Divisional Court. R.R.O. 1990, Reg. 194, r. 38.01 (2).

(3) Rules 38.02 to 38.12 apply to an application made under subsection 140 (3) of the Courts of Justice Act, unless otherwise provided in rule 38.13 and subject to any modifications set out in that rule. O. Reg. 43/14, s. 8 (2).

38.03 (1) The applicant shall, in the notice of application, name the place of commencement in accordance with rule 13.1.01. O. Reg. 438/08, s. 38.

(1.1) The application shall be heard in the county where the proceeding was commenced or to which it has been transferred under rule 13.1.02, unless the court orders otherwise. O. Reg. 438/08, s. 38.

(2) At any place where no practice direction concerning the scheduling of applications is in effect, an application may be set down for hearing on any day on which a judge is scheduled to hear applications. O. Reg. 770/92, s. 11.

(3) If a lawyer estimates that the hearing of the application will be more than two hours long, a hearing date shall be obtained from the registrar before the notice of application is served. O. Reg. 770/92, s. 11; O. Reg. 575/07, s. 3.

(3.1) An urgent application may be set down for hearing on any day on which a judge is scheduled to hear applications, even if a lawyer estimates that the hearing is likely to be more than two hours long. O. Reg. 770/92, s. 11; O. Reg. 575/07, s. 3.

(4) If a notice of application has been served and the respondent wishes to make an application against the applicant, or against the applicant and another person, the respondent shall make the application at the same place and time to the same judge, unless the court orders otherwise. O. Reg. 14/04, s. 20 (3).

38.04 Every notice of application (Form 14E, 14E.1, 68A, 73A, 74.44 or 75.5) shall state,

(a) the precise relief sought;

(b) the grounds to be argued, including a reference to any statutory provision or rule to be relied on; and

(c) the documentary evidence to be used at the hearing of the application. R.R.O. 1990, Reg. 194, r. 38.04; O. Reg. 484/94, s. 8; O. Reg. 43/14, s. 9.

38.05 A notice of application shall be issued as provided by rule 14.07 before it is served. R.R.O. 1990, Reg. 194, r. 38.05.

38.06 (1) The notice of application shall be served on all parties and, where there is uncertainty whether anyone else should be served, the applicant may make a motion without notice to a judge for an order for directions. R.R.O. 1990, Reg. 194, r. 38.06 (1).

(2) Where it appears to the judge hearing the application that the notice of application ought to have been served on a person who has not been served, the judge may,

(a) dismiss the application or dismiss it only against the person who was not served;

(b) adjourn the application and direct that the notice of application be served on the person; or

(c) direct that any judgment made on the application be served on the person. R.R.O. 1990, Reg. 194, r. 38.06 (2).

(3) The notice of application shall be served at least ten days before the date of the hearing of the application, except where the notice is served outside Ontario, in which case it shall be served at least twenty days before the hearing date. R.R.O. 1990, Reg. 194, r. 38.06 (3).

(4) The notice of application shall be filed with proof of service at least seven days before the hearing date in the court office where the application is to be heard. R.R.O. 1990, Reg. 194, r. 38.06 (4); O. Reg. 171/98, s. 15; O. Reg. 438/08, s. 39.

38.07 (1) A respondent who has been served with a notice of application shall forthwith deliver a notice of appearance (Form 38A). R.R.O. 1990, Reg. 194, r. 38.07 (1).

(2) A respondent who has not delivered a notice of appearance is not entitled to,

(a) receive notice of any step in the application;

(b) receive any further document in the application, unless,

(i) the court orders otherwise, or

(ii) the document is an amended notice of application that changes the relief sought;

(c) file material, examine a witness or cross-examine on an affidavit on the application; or

(d) be heard at the hearing of the application, except with leave of the presiding judge. O. Reg. 351/94, s. 3.

(3) Despite subrule (2), a party who is served with a notice of application outside Ontario may make a motion under subrule 17.06 (1) before delivering a notice of appearance and is entitled to be served with material responding to the motion. O. Reg. 351/94, s. 3.

38.09 (1) The applicant shall,

(a) serve an application record, together with a factum consisting of a concise argument stating the facts and law relied on by the applicant, at least seven days before the hearing, on every respondent who has served a notice of appearance; and

(b) file the application record and factum, with proof of service, at least seven days before the hearing, in the court office where the application is to be heard. R.R.O. 1990, Reg. 194, r. 38.09 (1); O. Reg. 171/98, s. 17 (1); O. Reg. 206/02, s. 9 (1); O. Reg. 438/08, s. 40 (1, 2).

(2) The applicant’s application record shall contain, in consecutively numbered pages arranged in the following order,

(a) a table of contents describing each document, including each exhibit, by its nature and date and, in the case of an exhibit, by exhibit number or letter;

(b) a copy of the notice of application;

(c) a copy of all affidavits and other material served by any party for use on the application;

(d) a list of all relevant transcripts of evidence in chronological order, but not necessarily the transcripts themselves; and

(e) a copy of any other material in the court file that is necessary for the hearing of the application. R.R.O. 1990, Reg. 194, r. 38.09 (2).

(3) The respondent shall serve on every other party, at least four days before the hearing, a factum consisting of a concise argument stating the facts and law relied on by the respondent. O. Reg. 171/98, s. 17 (2); O. Reg. 206/02, s. 9 (2); O. Reg. 14/04, s. 21; O. Reg. 438/08, s. 40 (3).

(3.1) If of the opinion that the application record is incomplete, the respondent may serve on every other party, at least four days before the hearing, a respondent’s application record containing, in consecutively numbered pages arranged in the following order,

(a) a table of contents describing each document, including each exhibit, by its nature and date and, in the case of an exhibit, by exhibit number or letter; and

(b) a copy of any material to be used by the respondent on the application and not included in the applicant’s application record. O. Reg. 171/98, s. 17 (2); O. Reg. 438/08, s. 40 (4).

(3.2) The respondent’s factum, and the respondent’s application record, if any, shall be filed with proof of service in the court office where the application is to be heard, at least four days before the hearing. O. Reg. 171/98, s. 17 (2); O. Reg. 438/08, s. 40 (5).

Commercial Tenancies Act, R.S.O. 1990, c. L.7

1. In this Act,

“landlord” includes a person who is lessor, owner, the person giving or permitting the occupation of the premises in question, and these persons’ heirs and assigns and legal representatives, and in Parts II and III also includes the person entitled to possession of the premises;

“tenant” includes a person who is lessee, occupant, sub-tenant, under-tenant, and the person’s assigns and legal representatives.

2. This Act does not apply to tenancies and tenancy agreements to which the Residential Tenancies Act, 2006 applies. 1997, c. 24, s. 213 (3); 2006, c. 17, s. 247.

4. All persons being grantees or assignees of the Queen, or of any person other than the Queen, and the heirs, executors, successors and assigns of every of them, shall have and enjoy like advantage against the lessees, their executors, administrators, and assigns, by entry for non-payment of the rent, or for doing of waste, or other forfeiture, and also shall have and enjoy all and every such like and the same advantage, benefit, and remedies, by action only, for the non-performance of other conditions, covenants, or agreements, contained and expressed in the indentures of their said leases, demises or grants against all and every of the said lessees and grantees, their executors, administrators, and assigns as the said lessors or grantors themselves, or their heirs or successors, might have had and enjoyed at any time or times. R.S.O. 1990, c. L.7, s. 4

18. (1) Every demise, whether by parol or in writing and whenever made, unless it is otherwise agreed, shall be deemed to include an agreement that if the rent reserved, or any part thereof, remains unpaid for fifteen days after any of the days on which it ought to have been paid, although no formal demand thereof has been made, it is lawful for the landlord at any time thereafter to re-enter into and upon the demised premises or any part thereof in the name of the whole and to have again, repossess and enjoy the same as of the landlord’s former estate. R.S.O. 1990, c. L.7, s. 18 (1).

(2) Every such demise shall be deemed to include an agreement that if the tenant or any other person is convicted of keeping a disorderly house within the meaning of the Criminal Code (Canada) on the demised premises or any part of it, or carries on or engages in, on the demised premises or any part of it, any trade, calling, business or occupation for which a licence is required under a business licensing by-law, as defined in subsection 1 (1) of the Municipal Act, 2001 or a by-law passed under paragraph 11 of subsection 8 (2) of the City of Toronto Act, 2006, as the case may be, without that licence, it is lawful for the landlord at any time thereafter to re-enter into the demised premises or any part of it and to have again, repossess and enjoy the same as of the landlord’s former estate. 2006, c. 32, Sched. C, s. 6.

19. (1) In this section and in sections 20 to 22,

“action” includes a proceeding under Part III; (“action”)

“under-lease” includes an agreement for an under-lease where the under-lessee has become entitled to have the under-lease granted; (“sous-bail”)

“under-lessee” includes any person deriving title under or from an under-lessee. (“sous-preneur”) R.S.O. 1990, c. L.7, s. 19 (1).

(2) A right of re-entry or forfeiture under any proviso or stipulation in a lease for a breach of any covenant or condition in the lease, other than a proviso in respect of the payment of rent, is not enforceable by action, entry, or otherwise, unless the lessor serves on the lessee a notice specifying the particular breach complained of, and, if the breach is capable of remedy, requiring the lessee to remedy the breach, and, in any case, requiring the lessee to make compensation in money for the breach, and the lessee fails within a reasonable time thereafter to remedy the breach, if it is capable of remedy, and to make reasonable compensation in money to the satisfaction of the lessor for the breach. R.S.O. 1990, c. L.7, s. 19 (2).

20. (1) Where a lessor is proceeding by action or otherwise to enforce a right of re-entry or forfeiture, whether for non-payment of rent or for other cause, the lessee may, in the lessor’s action, if any, or if there is no such action pending, then in an action or application in the Superior Court of Justice brought by the lessee, apply to the court for relief, and the court may grant such relief as, having regard to the proceeding and conduct of the parties under section 19 and to all the other circumstances, the court thinks fit, and on such terms as to payment of rent, costs, expenses, damages, compensation, penalty, or otherwise, including the granting of an injunction to restrain any like breach in the future as the court considers just. R.S.O. 1990, c. L.7, s. 20 (1); 2006, c. 19, Sched. C, s. 1 (1).

30. (1) The goods and chattels exempt from seizure under execution are not liable to seizure by distress by a landlord for rent, except as hereinafter provided. R.S.O. 1990, c. L.7, s. 30 (1).

35. (1) A tenant may set off against the rent due a debt due to the tenant by the landlord. R.S.O. 1990, c. L.7, s. 35 (1).

74. (1) Where a tenant after the tenant’s lease or right of occupation, whether created by writing or by parol, has expired or been determined, either by the landlord or by the tenant, by a notice to quit or notice pursuant to a proviso in a lease or agreement in that behalf, or has been determined by any other act whereby a tenancy or right of occupancy may be determined or put an end to, wrongfully refuses or neglects to go out of possession of the land demised to the tenant, or which the tenant has been permitted to occupy, the tenant’s landlord may apply upon affidavit to a judge of the Superior Court of Justice to make the inquiry hereinafter provided for and the application shall be made, heard and determined in the county or district in which the land lies. R.S.O. 1990, c. L.7, s. 74 (1); 1993, c. 27, Sched.; 2006, c. 19, Sched. C, s. 1 (1)

76. (1) If, at the time and place appointed, the tenant fails to appear, the judge, if it appears to him or her that the tenant wrongfully holds against the right of the landlord, may order a writ of possession (Form 3) directed to the sheriff of the county or district in which the land lies to be issued commanding him or her forthwith to place the landlord in possession of the land. R.S.O. 1990, c. L.7, s. 76 (1).

1100997 Ontario Limited v. North Elgin Centre Inc., 2016 ONCA 848 (CanLII)

[1] The issue in this appeal is whether, three years after the commencement of an application for a declaration that the appellant had a valid and subsisting lease, the motion judge erred in refusing to direct a trial of the issues and to permit the delivery of a statement of claim for damages for wrongful termination of the lease and loss of equipment and inventory. The motion judge refused such relief on the basis that the proposed statement of claim raised new claims that were statute-barred. For the reasons that follow, I would allow the appeal. The claims advanced arise from the same factual nexus set forth in the application and do not assert new causes of action.

[12] Orders refusing leave to amend a pleading to add what is determined to be a new cause of action outside a limitation period are typically treated as final orders, subject to appeal to this court: See for example, Frohlick v. Pinkerton Canada Ltd., 2008 ONCA 3, 88 O.R. (3d) 401; Dee Ferraro Ltd. v. Pellizzari, 2012 ONCA 55, 346 D.L.R. (4th) 624; and Keparutis v. Canamould Extrusions Inc., 2012 ONCA 844. The motion judge dismissed the motion to direct a trial of the issues because he concluded that 110 proposed to pursue new causes of action that did not arise from the factual nexus contained in the notice of application and were therefore statute-barred. The order is therefore final and this court has jurisdiction to entertain the appeal.

[17] In Energy Probe v. Canada (Attorney General) (1989), 1989 CanLII 258 (ON CA), 68 O.R. (2d) 449 (C.A.), leave to appeal refused 37 O.A.C. 160 (S.C.C.), in determining whether a cause of action was disclosed, this court stated that “affidavit materials on an application are to be considered as the pleadings” (at para. 10). Further, where oppression proceedings commenced by notice of application were converted into an action in Przysuski v. City Optical Holdings Inc., 2014 ONSC 3686, Perell J. refused to strike paragraphs of the statement of claim as raising unanticipated claims as an abuse of process because “[t]he Notice of Application should be read with its supporting affidavits and with the evidentiary record for the Application” (at para. 11).

[18] In this case, the affidavit of Manir Yousif (the “Yousif Affidavit”), the principal of 110, was filed in support of 110’s notice of application. In considering whether 110’s proposed statement of claim sought to advance new causes of action that are statute-barred, the motion judge ought to have considered this affidavit.

[35] The actionable fact in the notice of application was the threatened termination of 110’s tenancy. The notice of application adverted to the harm 110 would suffer as a result of the termination. The statement of claim is based on the same actionable fact: the termination of 110’s tenancy. The only difference is that 110 pleads additional facts about what transpired after the lease was terminated. As such, the claim for damages is simply an alternative remedy based on the same factual nexus as originally pleaded in the notice of application.

[36] While the notice of application originally sought only declaratory and injunctive relief, 110’s damages claim is not a “fundamentally different claim” based on a set of facts not originally pleaded.

[37] Further, the claims for breach of contract, unjust enrichment and bad faith set forth in the statement of claim, but not pleaded in the notice of application, are not new causes of action. They are new legal characterizations of the wrong that was alleged in the notice of application, and arise out of the same factual nexus.

[38] I therefore conclude that the proposed amendments contained in the statement of claim ought not to have been refused on the basis that they raised new claims based on new causes of action.

[39] Since it is clear that there are and will continue to be material facts in dispute, it is appropriate to direct a trial of the issues in the application and to permit 110 to deliver a statement of claim in the form proposed.