Commercial Leases and Relief From Forfeiture: A Second Chance For Tenants During COVID-19?

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Business Disputes, Commercial, Commercial and Contract Litigation, Commercial Contracts, Commercial Leasing, Commercial Litigation, Contract Disputes, Contract Termination, Real Estate Litigation, Shopping Mall Lease Disputes, Shopping Mall Lease Litigation0 Comments

Today is the first day landlords can apply for the Canada Emergency Commercial Rent Assistance Program (CECRA) as reported in our blog last week entitled COVID-19 | Ontario-Canada Emergency Rent Assistance Program – Part 2. Although commercial rent relief is now finally available for the months of April, May and June 2020, it has been over two months since non-essential businesses in Ontario were required to close.  The gradual re-opening of some non-essential businesses, under strict guidelines, was only announced over the last few weeks.  According to a recent survey by CFIB, 48% of Ontario small businesses suffered a drop in revenue of 70% or more.  It is highly unlikely that these small businesses will survive the COVID-19 pandemic without further assistance. In addition, it has been widely reported that some commercial landlords will not participate in the CECRA program for various reasons.  Furthermore, the forgivable loan of up to … Read More

COVID-19 | Ontario-Canada Emergency Commercial Rent Assistance Program – Part 2

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Business Disputes, Commercial, Commercial and Contract Litigation, Commercial Contracts, Commercial Lease Arbitrator, Commercial Leasing, Commercial Litigation, Contract Disputes, Contract Termination, Coronavirus, COVID-19, Shopping Mall Lease Disputes, Shopping Mall Lease Litigation0 Comments

Further to our blog entitled COVID-19 | Ontario-Canada Emergency Commercial Rent Assistance Program, CMHC has finally released further details about the OCECRA program including the opening date of the applications portal on May 25, 2020 at 8:00 a.m. EST. Amidst reports that many landlords were refusing to apply for the OCECRA program, Premier Doug Ford pleaded with landlords to participate in the OCECRA program, stating: “It is not going to be forever.  It is going to be for a few months.  Help people out.  You have an obligation to do that as a landlord”.  Prime Minister Justin Trudeau provided a more business-oriented argument for landlords to participate in the OCECRA program, stating: “With many people discovering that we can work from home … there may be a lot of vacancies in commercial buildings over the coming months and years.  Who knows exactly what the post-pandemic world will look like exactly?”. … Read More

COVID-19 | Ontario Announces More Businesses to Reopen During First Stage

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Business Disputes, Business Interruption, Civil Litigation, Commercial Contracts, Commercial Leasing, Contract Disputes, Contract Termination, Coronavirus, COVID-19, Debt and Enforcing Judgments, Event Cancellation, Event Termination, Real Estate Litigation, Retail Litigation, Shopping Mall Lease Disputes, Shopping Mall Lease Litigation0 Comments

Following on our previous blog last week entitled COVID-19 | Ontario Allows More Businesses To Reopen Soon, the Ontario government announced today plans for stage 1 to reopen the province, including allowing more businesses to reopen and/or relaxing restrictions on the delivery of goods and services. While the reopening of more businesses is welcome news after eight weeks in quarantine, Premier Doug Ford warned that individuals must still continue to practice social and physical distancing, and businesses should only reopen if they are ready to comply with the strict public health guidelines.  We cannot risk moving one step forward, but moving two steps back. The following is a list of some businesses that may reopen or expand their services on the following dates: May 16, 2020  Golf courses may open to the public but clubhouses only for washroom access and restaurants only for take-out (previously, golf courses could only prepare … Read More

COVID-19 | Ontario Allows More Businesses To Reopen Soon

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Business Disputes, Business Interruption, Commercial and Contract Litigation, Commercial Leasing, Construction | Builders, Contract Termination, Coronavirus, COVID-19, Creditors Rights, Debt and Enforcing Judgments, Event Cancellation, Event Termination, Force Majeure, Franchise Law, Real Estate Litigation, Retail Litigation, Shopping Mall Lease Disputes, Shopping Mall Lease Litigation0 Comments

Following on the Ontario government’s announcement last week allowing a select few businesses to re-open earlier this week, there was another announcement yesterday allowing more businesses to re-open under the same strict public and health safety guidelines. The following is a list of businesses that may re-open, and their scheduled re-opening dates over the next week: May 8, 2020:  Garden centres and nurseries can re-open for in-store payment and purchases (previously, these businesses could only offer curbside pick-up and delivery); May 9, 2020:  Hardware stores and safety supply stores can re-open for in-store payment and purchases (previously, these businesses could only offer curbside pick-up and delivery);  May 11, 2020:  Retail stores with street entrances can re-open but they can only offer curbside pick-up and delivery (previously, non-essential businesses were required to be closed). Small businesses that are planning to re-open are reminded to follow public and health safety guidelines including The … Read More

COVID-19 / Coronavirus: Urgent Hearings in Small Claims Court

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Business Disputes, Business Interruption, Civil Litigation, Commercial and Contract Litigation, Commercial Leasing, Condo Litigation, Construction Litigation, Contract Disputes, Contract Termination, Coronavirus, COVID-19, Creditors Rights, Debt and Enforcing Judgments, Event Cancellation, Event Termination, Fraud Recovery, Mortgage Litigation, Real Estate Litigation, Retail Litigation, Shopping Mall Lease Litigation0 Comments

Since March 16, 2020, all hearings in the Ontario Small Claims Court have been suspended due to the COVID-19 pandemic.  Although the Superior Court of Justice has had procedures in place to bring an urgent civil or commercial list hearing since March 15, 2020, the Small Claims Court was left without the ability to hear urgent motions and garnishment hearings until today. Today, the Chief Justice of the Superior Court of Justice released the updated Notice Regarding the Suspension of Small Claims Court Operations to outline the procedure to request an urgent hearing in Small Claims Court and to provide guidance on the type of matters a judge may find to be urgent.  Urgent  hearings may include: Cases in which a judgment debtor has an outstanding warrant for arrest issued in relation to a Small Claims Court proceeding; or Time-sensitive cases that would result in immediate and serious financial hardship … Read More

COVID-19 | Ontario to Permit Some Businesses to Reopen on May 4

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Business Disputes, Business Interruption, Business Litigation, Civil Litigation, Commercial and Contract Litigation, Commercial Leasing, Contract Disputes, Contract Termination, Coronavirus, COVID-19, Event Cancellation, Event Termination, Force Majeure, Government Action, Loan and Guarantee, Mortgage Enforcement, Mortgage Litigation, Real Estate Litigation, Retail Litigation, Shopping Mall Lease Disputes, Shopping Mall Lease Litigation0 Comments

On May 1, 2020, the Ontario government announced that a select few businesses will be allowed to re-open on Monday, May 4, 2020 but with strict public health and safety measures in place.  Most of these businesses are seasonal businesses and some essential construction projects. This announcement follows from the release earlier this week of the three-staged Framework for Reopening our Province which included stage 1 to reopen certain Ontario businesses gradually under strict guidelines in order to allow the economy to return to some sense of normalcy while continuing to safeguard the public and limit health risks. The following is the list of businesses that may be re-opened on May 4, 2020: Garden centres and nurseries – but they are restricted to alternative methods of sale such as curbside pickup and delivery; Lawn care services and landscaping services; Essential construction projects including shipping and logistics; broadband, telecommunications and digital … Read More

A Guide to Urgent Residential Eviction Orders and Enforcement During COVID-19

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Building | Property Management, Civil Litigation, Commercial Leasing, Contract Disputes, Contract Termination, Coronavirus, COVID-19, Debt and Enforcing Judgments, Real Estate Litigation0 Comments

On March 19, 2020, the Ontario Superior Court of Justice suspended the eviction of residents from their homes, pursuant to eviction orders issued by the Landlord and Tenant Board or writs of possession, during the COVID-19 pandemic, unless ordered otherwise in an urgent motion. On the same day, the Landlord and Tenant Board suspended all hearings related to eviction applications and suspended the issuance of eviction orders, unless the matter related to an urgent issue such as an illegal act or a serious safety threat. Urgent Eviction Order or Urgent Enforcement? 1.  If the landlord requires an urgent eviction order, then the landlord should proceed to file an urgent application with the Landlord and Tenant Board. 2.  If the landlord already has an eviction order (or writ of possession) and requires urgent enforcement, then an urgent motion should be made to the Superior Court of Justice under Rule 60.17 of … Read More

COVID-19 | Ontario-Canada Emergency Commercial Rent Assistance Program

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Business Disputes, Commercial and Contract Litigation, Commercial Lease Arbitrator, Commercial Leasing, Commercial Litigation, Contract Disputes, Contract Termination, Coronavirus, COVID-19, Shopping Mall Lease Disputes, Shopping Mall Lease Litigation0 Comments

On April 16, 2020, the Federal government announced the Canada Emergency Commercial Rent Assistance Program (CECRA) but could not provide further details because discussions with the provinces and territories were required for the administration and implementation of the program. Today, the Ontario government announced the Ontario-Canada Emergency Commercial Rent Assistance Program (OCECRA) and provided further details on the eligibility requirements and the terms of the forgiveable loan.  The OCECRA is expected to be operational in mid-May 2020, and will provide commercial rent relief for the months of April and May (retroactively) and June 2020. We summarize the OCECRA as follows: Ontario-Canada Emergency Commercial Rent Assistance Program – Updated May 7, 2020 What is the purpose of OCECRA?  To provide relief to landlords and small business tenants affected by COVID-19 by providing forgivable loans to landlords to cover 50% of the gross monthly rent for April, May and June 2020. Who … Read More

Ontario Extends Mandatory Closure of Non-Essential Businesses

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Business Dispute Arbitrator, Business Disputes, Business Interruption, Civil Litigation, Commercial and Contract Litigation, Commercial Lease Arbitrator, Commercial Leasing, Commercial Litigation, Contract Disputes, Contract Termination, Coronavirus, COVID-19, Creditors Rights, Employment, Franchise Law0 Comments

On April 23, 2020, the Ontario government announced that all emergency orders under the Emergency Management and Civil Protection Act, including the mandatory closure of non-essential businesses, have been extended until May 19, 2020 (Updated: May 7, 2020). A list of the extended orders and the current revocation dates are found here. Although the closure of non-essential businesses is necessary to fight the COVID-19 pandemic, many small businesses have been closed for over a month and will be closed for at least another two week period with no or very minimal revenue coming in.  A survey conducted by the Canadian Federation of Independent Business (CFIB) indicated that 40% of Canadian small businesses were worried the pandemic would force them to permanently close.  These small businesses, which form the backbone of the economy, are unlikely to survive without further assistance from the federal, provincial and municipal governments and/or cooperation from landlords, … Read More

Corporate Governance Considerations During the Covid-19 Pandemic

Sabrina Saltmarsh, B.A. (Hons), J.D.Business Interruption, Business Law, Business Litigation, Business Torts | Economic Torts, By-laws, Closely-Held Business Disputes, Commercial, Commercial and Contract Litigation, Commercial Contracts, Commercial Law, Commercial Leasing, Commercial List Matters, Commercial Litigation, Contract Disputes, Coronavirus, Corporate Disputes, Corporate Litigation, COVID-19, Derivative Actions, Directors' and Officers' Liability, Family Business Disputes, Oppression Remedies, Partnership Dispute, Partnerships and Shareholder Disputes, Retail Disputes, Retail Litigation, Sale of Business Disputes, Shopping Mall Lease Disputes, Shopping Mall Lease Litigation0 Comments

Corporate governance issues are top of mind for directors and businesses who are attempting to navigate through the Covid-19 Pandemic related closures and emergency measures. Boards of Directors still need to operate and make decisions in the best interests of the corporation, and this can involve tough decisions, particularly where there is little guidance as to how measures to lift Covid-19 related restrictions will play out. By example, while it may be in the best interest of investors and shareholders that the Board act to lay off employees in the short term, the impact of staff shortages when Covid-19 restrictions are lifted may pose it’s own challenges. Many businesses must consider how to hold governance meetings during Covid-19 times. On March 30, 2020, Ontario passed an Order under the Emergency Management and Civil Protection Act (EMCPA), (Ontario Regulation 107/20) entitled “Meetings for Corporations” making temporary changes to the Business Corporations … Read More

COVID-19 / Coronavirus: Rent Relief for Small Businesses Is Coming

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Business Interruption, Business Litigation, Civil Litigation, Commercial and Contract Litigation, Commercial Arbitrator, Commercial Contracts, Commercial Law, Commercial Lease Arbitrator, Commercial Leasing, Commercial List Matters, Commercial Litigation, Contract Disputes, Contract Termination, Coronavirus, COVID-19, Real Estate Litigation0 Comments

On April 16, 2020, the Federal government announced the Canada Emergency Commercial Rent Assistance (CECRA) program to assist small businesses with their rent payments during the COVID-19 crisis. The CECRA program will provide loans and/or forgiveable loans to commercial property owners who will be expected to pass on the benefit to small businesses by lowering or forgoing rent for April (retroactively), May and June 2020.  Further details of the program are expected to be released soon and the program will be administered by the provincial and territorial governments. Although the Ontario Superior Court of Justice had issued an Order on March 19, 2020 suspending the eviction of residents from their homes (unless ordered otherwise under an urgent motion), there was no similar protection against evictions for commercial tenants which included many small business owners. Commercial rent payments are typically the second largest operating expense for most small businesses after payroll … Read More

Small Business Relief Resources During COVID-19 / Coronavirus

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Business Disputes, Business Interruption, Civil Litigation, Commercial, Commercial and Contract Litigation, Commercial Contracts, Commercial Leasing, Commercial Lending, Commercial Litigation, Contract Disputes, Contract Termination, Coronavirus, COVID-19, Creditors Rights, Debt and Enforcing Judgments, Distribution Agreements, Event Cancellation, Event Termination, Force Majeure, Franchise | Licensing, Government Action, Loan and Guarantee, Mortgage Enforcement, Mortgage Litigation, Real Estate Litigation, Retail Disputes, Retail Litigation, Shopping Mall Lease Disputes, Shopping Mall Lease Litigation0 Comments

On April 14, 2020, the Ontario legislature passed a bill during an emergency sitting to extend the state of emergency to May 12, 2020. The state of emergency in Ontario was initially declared on March 17, 2020, and subsequently extended to April 14, 2020.  Under the Emergency Management and Civil Protection Act, any further extensions must be passed by the legislature, and can only be extended for additional periods of no more than 28 days.  On May 12, 2020, the state of emergency was extended to June 2, 2020 (Updated: May 12, 2020). Although the extension of the state of emergency does not automatically apply to individual orders such as the closure of non-essential businesses, it is expected the mandatory closure of non-essential businesses will be extended as well to combat the COVID-19 pandemic.  In addition, many small businesses (deemed essential) have voluntarily closed due to safety concerns for their … Read More

Covid-19 Pandemic Closures: Considerations For Commercial Tenants And Landlords

Sabrina Saltmarsh, B.A. (Hons), J.D.Building | Property Management, Business Disputes, Business Interruption, Commercial and Contract Litigation, Commercial Contracts, Commercial Lease Arbitrator, Commercial Leasing, Commercial Litigation, Contract Termination, Coronavirus, COVID-19, Force Majeure, Franchise | Licensing, Government Action, Injunction & Specific Performance, Insurance, Property Management, Real Estate Litigation, REIT Disputes, Shopping Mall Lease Disputes, Shopping Mall Lease Litigation0 Comments

What can commercial tenants and landlords do to protect themselves from the impact of Covid-19 related closures on commercial lease obligations? Here are some tips for businesses who are in the difficult situation of having to deal with potential defaults on commercial rent obligations related to closures or reductions due to the Covid-19 situation. 1. Review The Lease Agreement Carefully For Potentially Relevant Clauses In Ontario, the commercial landlord-tenant relationship is governed by the Commercial Tenancies Act, R.S.O. 1990, c. L.7., (the “Act”) which outlines the relationship, rights and obligations between commercial landlords and tenants. However these relationships are heavily governed by the commercial lease agreement in place between the landlord and the tenant, which can take precedence over the Act based on the agreement of the parties. Review the Act and more importantly, review your commercial lease agreement carefully to appreciate whether the agreement contemplates the type of situation … Read More

COVID-19 / Coronavirus: How to Schedule an Urgent Civil or Commercial List Hearing

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Business Disputes, Civil Litigation, Commercial, Commercial and Contract Litigation, Commercial Contracts, Commercial Law, Commercial Leasing, Commercial List Matters, Commercial Litigation, Contract Disputes, Contract Termination, Coronavirus, COVID-19, Injunction & Specific Performance, Real Estate Litigation0 Comments

On March 15, 2020, the Chief Justice of the Ontario Superior Court of Justice released a Notice to the Profession advising that all scheduled civil hearings were adjourned until further notice.  The Notice to the Profession provides a procedure to schedule urgent and time-sensitive motions and applications where immediate and significant financial repercussions may result without a hearing.  When motion or application materials are filed, by email to the appropriate courthouse, seeking an urgent hearing, the triage judge will determine whether or not the matter is urgent and should be scheduled for a hearing. There have been a few recent endorsements reported in respect to the scheduling of urgent commercial lease matters. Urgent Motion – Relief From Forfeiture In Oppong v. Desoro Holdings Inc., 2020 ONSC 1697, the applicant sought relief from forfeiture to set aside the landlord’s termination of the lease.  Although the application was brought promptly and scheduled to be … Read More

Court Clarifies “Clean Hands” Doctrine Applies to Post-Breach Conduct

Yona Gal, J.D., LL.MCommercial, Commercial Leasing0 Comments

In 232702 Ontario v 1305 Dundas, 2019 ONSC 1885, the Ontario Superior Court of Justice recently considered the “clean hands” doctrine in the context of a terminated commercial lease for non-payment of rent. Importantly, the Court clarified that the doctrine of “clean hands” is not restricted to conduct occurring prior to the breach, but encompasses subsequent conduct as well. The Test for Relief from Forfeiture Under s. 98 of the Courts of Justice Act and s. 20 of the Commercial Tenancies Act, a court may grant relief from forfeiture, including forfeiture of a lease for non-payment of rent. The court’s power to relieve from forfeiture is an equitable remedy.  It is discretionary, fact-specific and granted sparingly.  The party seeking relief must prove that enforcing the contractual right would lead to inequitable consequences. In Saskatchewan River Bungalows Ltd. v Maritime Life Assurance Co., the Supreme Court of Canada held that a … Read More

Grounds for Judicial Intervention on International Arbitral Awards – Key Takeaways

Janice Perri, B.A. (Summa Cum Laude)Appeals, Arbitration, Commercial, Commercial and Contract Litigation, Commercial Arbitration, Commercial Leasing, Commercial Litigation, Construction | Builders, Construction Litigation, Enforcement of Foreign Arbitral Awards, UNCITRAL0 Comments

In Consolidated Contractors Group S.A.L. (Offshore) v. Ambatovy Minerals S.A., a decision of the Court of Appeal for Ontario, a USD$258 million project for the construction of a slurry pipeline from a nickel mine in the mountains of Madagascar to the coast lead to arbitration between the appellant (the contractor) and the respondent (tendered the project). After mutually agreeing to by-pass the adjudication stage of their three-stage dispute resolution process and go straight to a Tribunal, the appellant was only awarded $7M of its $91M claim and the respondent was awarded nearly $25M on its counterclaim. These awards were challenged on appeal as being made without jurisdiction, in breach of procedural fairness, and violating public policy. However, the appeal was dismissed. Judicial intervention in international arbitral awards under the United Nations Commission on International Trade Law (UNCITRAL) Model Law (the “Model Law”) – though given the force of law by the International Commercial Arbitration Act … Read More

McDonald’s Not Served Valid Revocation of Waiver – Commercial Leasing in the Court of Appeal

David Alderson, LL.B, LL.M (Commercial and Corporate), Q.Arb, Lawyer and ArbitratorAppeals, Arbitration, Business Litigation, Commercial, Commercial and Contract Litigation, Commercial Arbitration, Commercial Leasing, Injunction & Specific Performance, Real Estate Litigation, Retail Litigation, Shopping Mall Lease Disputes0 Comments

The Court of Appeal for Ontario in North Elgin Centre Inc. v. McDonald’s Restaurants of Canada Limited, 2018 ONCA 71 allowed an appeal by McDonald’s from a decision on applications by both parties to determine whether  the subject lease came to an end on a described date because McDonald’s had not complied with the renewal provision in the lease. The Court of Appeal allowed the appeal of the decision of the application judge, that despite that the parties were in negotiations, and that the respondent had waived its right to insist on strict compliance with the  terms of the renewal provision (to refer the determination of the renewal rental rate to arbitration), that the respondent had effectively revoked its waiver and reverted to its strict legal rights, namely to terminate the lease in the absence of the referral of the dispute on renewal rental rate to arbitration within the permitted time. On the … Read More