Emergency Suspension Order O'Reg 73/20 (Commercial Tenancy)

O. Reg. 73/20: ORDER UNDER SUBSECTION 7.1 (2) OF THE ACT - LIMITATION PERIODS

Whereas an emergency has been declared pursuant to Order in Council 518/2020 (Ontario Regulation 50/20) on March 17, 2020 at 7:30 a.m. Toronto time pursuant to section 7.0.1 of the Emergency Management and Civil Protection Act (the “Act”) and has been extended pursuant to section 7.0.7 of the Act;

And Whereas the criteria set out in subsection 7.1 (2) of the Act have been satisfied;

Now Therefore, an Order is made pursuant to subsection 7.1 (2) of the Act, the terms of which Order are the following:

1. Any provision of any statute, regulation, rule, by-law or order of the Government of Ontario establishing any limitation period shall be suspended, and the suspension shall be retroactive to Monday, March 16, 2020. O. Reg. 73/20, s. 1; O. Reg. 258/20, s. 1.

2. Any provision of any statute, regulation, rule, by-law or order of the Government of Ontario establishing any period of time within which any step must be taken in any proceeding in Ontario, including any intended proceeding, shall, subject to the discretion of the court, tribunal or other decision-maker responsible for the proceeding, be suspended, and the suspension shall be retroactive to Monday, March 16, 2020. O. Reg. 73/20, s. 2; O. Reg. 258/20, s. 2.

2.0.1 (1) For greater certainty, the discretion of a court or tribunal referred to in section 2 may be exercised by,

(a) the person or persons who have jurisdiction to make orders in the proceeding;

(b) the Chief Justice of Ontario, in respect of any or all of the proceedings before the Court of Appeal for Ontario;

(c) the Chief Justice of the Superior Court of Justice, in respect of any or all of the proceedings before the Superior Court of Justice;

(d) the Chief Justice of the Ontario Court of Justice, in respect of any or all of the proceedings before the Ontario Court of Justice; or

(e) the chair of a tribunal, in respect of any or all of the proceedings before the tribunal. O. Reg. 258/20, s. 3.

(2) For greater certainty, the discretion of a decision-maker referred to in section 2 may be exercised in respect of any or all of the proceedings before the decision-maker. O. Reg. 258/20, s. 3.

2.1 For greater certainty and without limiting the generality of section 2, section 2 applies to by-laws made by the boards of hospitals under the Public Hospitals Act that relate to the hospital’s credentialing process, as defined in section 1 of Ontario Regulation 193/20 (Order Under Subsection 7.0.2 (4) of the Act - Hospital Credentialing Processes) made under the Act. O. Reg. 194/20, s. 1.

3. On and after April 9, 2020, sections 1 and 2 do not apply to provisions of the Niagara Escarpment Planning and Development Act or of the regulations made under it if the provisions establish a limitation period or period of time within which any step must be taken in a proceeding, including an intended proceeding. O. Reg. 137/20, s. 3.

4. On and after April 16, 2020, sections 1 and 2 do not apply to provisions of the Construction Act or of the regulations made under it if the provisions establish a limitation period or period of time within which any step must be taken in a proceeding, including an intended proceeding. O. Reg. 137/20, s. 3.

5. On and after June 8, 2020, sections 1 and 2 do not apply to provisions of Part V of the Family Responsibility and Support Arrears Enforcement Act, 1996 if the provisions establish a limitation period or period of time within which any step must be taken in a proceeding, including an intended proceeding. O. Reg. 258/20, s. 4.

The duration of this Order is subject to any renewal required under subsection 7.1 (4) and, if applicable, subsection 7.1 (5) of the Act.

Cerberus Business Financial, LLC v. B & W Heat Treating Canada, ULC, 2020 ONSC 3781 (CanLII)

[3] The dispute, primarily, concerns whether A. Farber & Partners Inc., in its capacity as Trustee (“Farber as Trustee” or “Trustee”), can access the premises of the bankrupt, B&W Heat Treating Canada, ULC (“B&W”), located at 60 Steckle Place, Kitchener, Ontario (the “Premises”) and whether it can extend or suspend the three-month limitation period provided for in s. 38(2) of the Commercial Tenancies Act, R.S.O. 1990, c. L.7 (“CTA”), which provides that a trustee must elect to disclaim, retain or assign a lease within that time period.

[15] Since the 90-day period expires on June 29, 2020 the Trustee is seeking an extension to allow it to continue to market the Lease for a further three-month period from the date of this order. Alternatively, the Trustee argues that the three-month period during which the Trustee must make an election is suspended for the duration of the emergency by virtue of the provisions of Ontario Regulation 73/20, ordered under s. 7.1(2) of the Emergency Management and Civil Protection Act, R.S.O. 1990, c. E.9 (the “Suspension Order”), which was passed by the Ontario legislature in response to the COVID-19 pandemic.

[21] I do, however, accept the Trustee’s second argument that s. 2 of the Suspension Order provides this court with jurisdiction to extend the time period set out in s. 38(2) of the CTA.

[22] The relevant portions of the Suspension Order read as follows:

Limitation periods

1. Any provision of any statute, regulation, rule, by-law or order of the Government of Ontario establishing any limitation period shall be suspended, and the suspension shall be retroactive to Monday, March 16, 2020.

Period of time, steps in a proceeding

2. Any provision of any statute, regulation, rule, by-law or order of the Government of Ontario establishing any period of time within which any step must be taken in any proceeding in Ontario, including any intended proceeding, shall, subject to the discretion of the court, tribunal or other decision-maker responsible for the proceeding, be suspended, and the suspension shall be retroactive to Monday, March 16, 2020.

[23] First, I do not accept the Trustee’s position that s. 1 allows me to extend or suspend the three-month time period. Notwithstanding the general language used in an oral decision by the court in Darrigo Consolidated Holdings Ltd. v. Norfinch Construction (Toronto) Ltd. (1987), 63 C.B.R. (N.S.) 216 (Ont. H.C.), which described the three-month period in s. 38(2) as a “limitation period”, I am not of the view that the time period contained in s. 38(2) of the CTA constitutes a limitation period. In Darrigo, nothing turned on the description of the three-month period and I am satisfied that the language used by the court was merely descriptive in nature.

[24] I agree with the Landlord that the typical policy behind a limitation period is to provide a timeline under which a step in a dispute ought to be commenced and after the deadline has passed the incident is closed: see Lui v. West Granville Manor Ltd. (1985), 1985 CanLII 155 (BC CA), 61 B.C.L.R. 315 (C.A.). Accordingly, I am not of the view that the three-month provision contained in s. 38(2) of the CTA constitutes a limitation period so that s. 1 of the Suspension Order would apply.

[25] In my view, however, s. 2 of the Suspension Order does provide the necessary relief to the Trustee. B&W’s bankruptcy constitutes a “proceeding” pursuant to the provisions of the BIA. The three-month time period imposed under s. 38(2) of the CTA is a period of time within which a step in the bankruptcy proceeding must be taken. Thus, s. 2 of the Suspension Order is engaged.

[26] The operation of s. 2 of the Suspension Order, however, is subject to the discretion of this court.

[27] In my view, it would be reasonable to exercise my discretion and provide the Trustee with the primary relief that it seeks – a 90-day extension of the time period contained in s. 38(2) of the CTA so that it could attempt to market the Lease for a further 90 days subject to the conditions below. I am not prepared to grant the alternative relief sought by the Trustee, which is to declare that the three-month period during which the Trustee must make an election under s. 38(2) of the CTA is suspended for the duration of the emergency. This would be unfair to the Landlord as it would leave the Landlord in an unduly vulnerable position for an unknown, extended period of time.