



COURT OF APPEAL FOR ONTARIO

CITATION: 911 Priority Corporation v.
    Murray, 2020 ONCA 171

DATE: 20200305

DOCKET: C67172

Feldman, Huscroft and Harvison
    Young JJ.A.

BETWEEN

911 Priority Corporation and Caleb Kalenuik

Applicants

(Respondents in Appeal)

and

Ernest Murray and Sandra Murray

Respondents

(Appellants in Appeal)

Spencer Toole, for the appellants

Jordan Moss, for the respondents

Heard and released orally: March 2, 2020

On
    appeal from the judgment of Justice Mary E. Vallee of the Superior Court of
    Justice, dated June 10, 2019.

REASONS FOR DECISION

[1]

The appellants are the landlords of a commercial
    space that was leased to the respondent tenants. The written lease contained a
    provision in s. 17.1
Right to Re-enter
, which in relevant part
    provides as follows:

When

(a) the Tenant shall be default
    in the payment of any Rent whether lawfully demanded or not and such default
    shall continue for a period of Seven (7) consecutive days following written
    notice



Then and in any of such cases the
    then current months Rent, together with the Rent for the three (3) months next
    ensuing shall immediately become due and payable, and at the option of the
    Landlord, the term shall become forfeited and void, and the Landlord without
    notice or any form of legal process whatsoever may forthwith re-enter upon the
    Premises



[2]

The respondents were in arrears of rent
    beginning in August 2018. The appellants served a written notice under s. 17.1
    of the lease demanding the outstanding rent, as well as the September rent and
    giving seven days to pay.

[3]

Although the respondents paid the August and
    September rent by October 9, 2018, they did not pay the accelerated rent provided
    by s. 17.1 of the lease. They continued in arrears until January 2019, when
    another written notice was sent. That notice gave only three days to pay.

[4]

Payment was not made, and the appellant
    landlords re-entered after five days, not seven as required by s. 17.1 of the
    lease. The respondents then brought an application for a declaration that the
    notice of termination was void and for damages for wrongful termination.

[5]

The application judge held that because the
    January notice was defective and the re-entry before seven days was wrongful,
    the landlord was in breach of the lease by wrongfully terminating it. She
    ordered a trial of the issue of the respondents damages.

[6]

We agree with the appellants that the trial
    judge erred in law by failing to find that the landlord was entitled to re-enter
    based on the failure of the tenant to comply with the August 2018 notice, by
    paying the arrears together with the accelerated rent, provided automatically
    under s. 17.1 of the lease. That breach continued up to the date of the
    re-entry. The appellants did not waive the respondents breach by accepting
    some of the rent after August, as the parties had contracted out of waiver in
    the lease (para. 21.1).

[7]

The order of the trial judge is therefore set
    aside and the application is dismissed. Costs of the appeal to the appellants
    fixed in the agreed amount of $9,750 inclusive of disbursements and HST. Costs
    awarded below in the amount of $27,000 to the respondents will now be paid to
    the appellants.

K.
    Feldman J.A.

Grant
    Huscroft J.A.

Harvison
    Young J.A.


