The Sisyphean Journey...Application for Leave to the SCC

Following on my last post entitled the Sisyphean Journey, I'm going to stay with that theme for now. Anyone wishing to see more about why I refer to the current state of my litigation with Westsea Construction as such a journey, may like to check my last post on the subject.

Admittedly there is a certain futility and even delusional optimism associated with applying for leave to appeal to the Supreme Court of Canada (SCC) in relation to the Court of Appeal decision (for more discussion, again see last post).  The SCC receives something in the order of 500 applications for leave a year, and grants leave in about 50 or 60 such cases. So, the sheer probability of my application being granted leave is small. 

However, there are some reasons to think this may meet the SCC tests of national and public importance in granting leave. I won't delve into detail here, but Memorandum of Argument on my application for leave spells it all out. My materials arrived at the SCC registry on Thursday.  As I understand it, time begins to run for other deadlines once the other side is served with the materials, which I did the week before.  The Registry still needs to assign a file number to it and send confirmation the file is open, but I have learned materials have been received and entered into their system. There is at least one part of the application that is incomplete (waiting for a document), and there may be other things that I will need to correct.

For now, I can await receipt of Westsea's reply material. I do have some idea of how they intend to respond, but I won't comment further at this time.

In the end, I am certainly prepared to see leave not granted, but will hold some guarded and cautious optimism. We will likely know within 3 to 4 months. Of course, even if leave is granted, there is no guarantee the SCC would see things favorably in my direction.

There is also Westsea Court of Appeal matter #2 upcoming soon as well.  More on that front later.

The Sisyphean journey: Trenchard v. Westsea Construction Ltd. CA44007 judgment released

On October 6, 2017, the Court of Appeal made an oral judgment in this dispute, released in written form today .

Summary of decision

The court allowed Westsea's appeal in part, but on grounds raised by neither of the parties. The court said that the decision by the lower court was premature, and that Judge MacKenzie should, in essence, have sent Westsea away to make its demand for payment from the leaseholders, and that Westsea should subsequently have litigated if and when leaseholders refused to pay.  Instead, Judge MacKenzie went on to interpret the Orchard House lease and found that the lease was properly interpreted to mean that Westsea could not recover its litigation costs from the leaseholders. However, the Court of Appeal said that Westsea had inappropriately made its election to seek its litigation costs from all the leaseholders in the context of litigation between only myself and Westsea, and so Judge MacKenzie ought not to have interpreted the lease, leading to Westsea's appeal.


Court's decision contains some elements of fairness

While I can see some elements of fairness in the Court of Appeal's decision, overall I can only describe the decision as bizarre.  In terms of its fairness, the decision forces Westsea to account individually to each leaseholder for their specified apportioned cost, and then to take action against those who refuse to pay. In this way, the Court of Appeal does seem to recognize the transparency issue that I raised in my original petition. Additionally, given Judge MacKenzie's decision in which he found Westsea could not charge its litigation costs back to leaseholders, and that the Court of Appeal expressly neither impugned nor supported that part of his decision, there is some risk to Westsea should it decide to re-litigate. Also, there is a sense of neutrality to the decision, and this is reflected in its decision not to award costs to either party.

Sisyphus re-visited

However, the likelihood that Westsea will want to re-litigate the issue is very high, in my view, because of other litigation on the go, and the potential for future litigation involving Westsea and other leaseholders, whether they are from Orchard House or other buildings. So, in my view, the court's decision pushes the re-set button on an issue that it really ought to have decided.  In the end, the court's decision serves to increase the prejudice to the leaseholders, rather than to mitigate the potential injustice related to any failure by Westsea to notify leaseholders of its demand for payment of its litigation costs associated with my petition.

In practical reality, as I pointed out to the court, some leaseholders will simply pay on demand because they are intimidated by the demand and will not be aware they can still dispute the issue.  Others, like myself, who dispute the matter, will have to roll the painful Sisyphean litigation rock uphill all over again, all the way up to the Court of Appeal again for a definitive answer.  In my view, this is not a just result.

A rare instance in which I agreed with counsel for Westsea

Indeed, even counsel for Westsea argued that Judge MacKenzie properly had jurisdiction to make his decision. Westsea of course disagreed with Judge Mackenzie's interpretation of the lease, and this was the basis for their appeal, but they did not dispute that he had jurisdiction to make the finding. Counsel for Westsea pointed out that I had obtained an order for substituted service and served all of the other leaseholders with notice of my amended petition. This meant the leaseholders had been notified of my application to the court for an interpretation of the lease.

Disagreeing with this view, however, the Court of Appeal said:

"It was wrong for Westsea to have urged the court to decide an issue prematurely, resulting in it incurring additional legal expenses here and in the court below".

However, in fact Westsea was not the party to apply originally for the interpretation as made by Judge MacKenzie. It was I who originally sought his declaratory judgment.  On this basis, Westsea made it's election at the petition hearing that it would pursue costs under the lease, which thus created "a real issue" that was squarely within the judge's jurisdiction to decide.

While obviously Westsea's counsel and I have disagreed on many things, I agree whole-heartedly with him that Judge MacKenzie had jurisdiction to consider the issue and to make a declaratory finding. In fact in R. v. Solosky, 1980 1 SCR 821, the Supreme Court of Canada stated:

"Declaratory relief is a remedy neither constrained by form nor bounded by substantive content, which avails persons sharing a legal relationship, in respect of which a 'real issue' concerning the relative interests of each has been raised and falls to be determined". (p. 830)

Indeed, I commenced my litigation under a petition and not a Notice of Civil Claim for the very reason that the issues I was raising involved declarations, and I carefully followed the Rules of Court on this point.


Insufficient opportunity to prepare submissions on a point not raised by either party

In our case, the problems, as I see them, with the Court of Appeal's decision, are compounded by its failure to provide a reasonable opportunity to allow both parties more time to generate submissions on an issue that was not raised by either parties. The Court of Appeal was frank about relying on a distinct issue not raised by either party, saying (para 12), "As the appeal is allowed but not for the reasons argued before us, I would not make any award as to costs."

While it's great there were no costs awarded, the failure of the court to allow time for the parties to make adequate submissions on this point is really a huge error, in my view.

The Supreme Court of Canada, in R. v. Mian, 2014 2 SCR 689, stated, at para 30

"An issue is new when it raises a new basis for potentially finding error in the decision under appeal beyond the grounds of appeal as framed by the parties. Genuinely new issues are legally and factually distinct from the grounds of appeal raised by the parties (see Quan v. Cusson, 2009 SCC 62, [2009] 3 S.C.R. 712, at para. 39) and cannot reasonably be said to stem from the issues as framed by the parties. It follows from this definition that a new issue will require notifying the parties in advance so that they are able to address it adequately." [my emphasis]

That the Court of Appeal sought submissions from me summarily without time to research the new issue, is even more egregious, I argue, given that I am a self-represented litigant.

My failure to cross-appeal

While there are other technical errors which I won't get into at the moment, I want to comment on the the court's statement at paragraph 6:

"I say the "primary" issue because Mr. Trenchard in his factum seeks various other remedies in the absence of any appeal by him.  Clearly he is not entitled to the relief he seeks as he did not cross-appeal."

Now, admittedly, in my factum I applied for a "declaration" for a finding that Westsea had breached its duty of honest performance. This was, I suggest, a matter addressed implicitly by Judge Mackenzie's decision, and was raised in issue by Westsea. Now, I accept that I ought not to have sought a declaration on this particular point in the absence of a cross-appeal, but the court seems to have lumped together a bunch of my arguments in response to issues fairly raised by Westsea and by the nature and character of Judge MacKenzie's decision. (See here for Westsea's factum).  This sort of generalized impugning of my arguments is, I would argue, really just bad decision making.

My application for fresh evidence

Also, one of the "remedies" I had sought was in relation to an application I made for fresh evidence. Now, right away some may think, "oh god, what's Trenchard up to trying to bring in fresh evidence". But the evidence I sought for admission was a whole bunch of other identical leases from other buildings in BC. With these I wanted to show that the Orchard House lease is a standard form lease. This is important in light of a recent decision by the Supreme Court of Canada in Ledcor Construction v. Northbridge Indemnity Insurance Co, 2016 SCC 37, which, on my argument, effectively instructs appellate courts to consider, in the determination of the appropriate standard of review, whether a contract is standard form or not.

Coupled with this, I argued that the Orchard House standard form lease in question is residential and not commercial, which distinguishes it from a line of authority that has been mounting in BC that applies commercial lease precedents to 99-year residential leases like ours, which is really comparing apples to oranges.  The key difference is that for commercial leases, parties have greater equality of bargaining power and enter leases at arms-length, and often under the oversight of lawyers.  This is not the case for standard form residential leases, which are essentially "take-it-or-leave-it" contracts drafted by the lessor and which lessees have had no hand in negotiating.

There are other technical errors which, in my view, the court made. I won't get into these here, but the court of appeal actually stated during submissions that it had considered my motion for fresh evidence in along with its deliberations, but in the end it did not say how.  This, in my view, is another procedural error.

Application for leave to appeal to the Supreme Court of Canada (SCC)

The Orchard House 99-year residential lease, and many others just like it in BC are, in my view,  standard form residential leases, affecting upwards of 3000 individual leasehold units. This makes interpretation issues under these leases to be fundamentally issues of substantial public importance. I understand that the mandate of the SCC is to consider cases of public importance, and it is not primarily concerned with appeal court errors. Of course, it seems to me, an appeal court must err in some way for a further appeal to become attractive to the parties.

In the end, what I take from the Court of Appeal decision is an opening to seek leave to appeal to the Supreme Court of Canada. Now statistically about 10-15% of leave applications are granted, so the odds of getting leave are small.  However, because of the public importance aspect of these issues, such an appeal seems well worth a try.

At this stage of the game it's just another hill on the Sisyphean journey.  On the way, I am prepared to see the ball roll in either direction. If it rolls back over me, it may scuff me up, but it's not big enough to break me.

Trenchard v. Westsea 16-3355 Madam Justice Power's decision to dismiss Westsea's application to strike

Here is Madam Justice Power's August 2, 2017 decision dismissing Westsea's application to strike my claims on the basis of res judicata; allowing my application to amend my pleadings, and granting costs in my favor, payable by Westsea to me forthwith:  Madam Justice Power's decision And here is the entered Order attaching Further Amended Notice of Civil Claim.

Westsea has elected to appeal this, which should not be all that surprising. However, I do find myself marginally surprised if only because I really don't believe they have very strong grounds to do so.  If anything, they may have some grounds for appealing her decision to grant my costs payable forthwith, because Judge Power didn't provide much rationale for doing so.  But Westsea has, in my view, scant grounds to appeal her decision on its merits, even if she may have slightly and in insignificant ways mis-stated aspects of the law or the facts. This is unlike Westsea's appeal of Judge MacKenzie's decision, which he practically wrote to be appealed and to have the issues regarding disclosure re-considered by the Court of Appeal.  

Speaking of which, the hearing for the appeal of Mr. Justice MacKenzie's Sept 23, 2016 decision in which he said Westsea could not charge its legal costs to leaseholders under the lease, is upcoming on October 6, 2017. Because of the interesting (and brilliant, I would say) way he wrote his decision, there are several interesting issues for the court to consider, including:

• is there a different category of new evidence the CA should consider in order to review the lease on the basis that it is a standard form contract (based on SCC Ledcor (2016))
• is there a set of legal tests to determine how the lessor should apply prudence and reasonable discretion under this kind of residential lease (based on SCC Ontario (Energy Board) (2015))
• is there a duty on the lessor to reasonably accommodate requests for information that affect the interests of leaseholders, and does this flow from a duty to be honest and not to mislead in contractual relations (based on SCC Bhasin v. Hrynew, (2014))

These are the novel issues the CA will have to grapple with.  There are other factual and mixed fact/law issues the court will need to deal with, including:

• is the lease appropriately characterized as a residential lease and not a commercial lease, thus rendering obsolete a line of precedent Westsea relies upon that applies primarily to commercial leases
• is there a public interest issue in this lease that affects how it should be interpreted (based on SCC Tercon (2010))
• are Westsea's "convenants" under the lease confined to their expressly stated large "C" "Covenants" or do they also include small 'c' covenants within the lease.

This will be a comparatively important appeal not only because of some novel legal issues, but because it will affect not just the 200 or so other leaseholders under the Orchard House lease, but also some 3000 other similar long-term residential leases in BC.

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