RESIDENTS OF OLD BONAVENTURE as represented by ROSANNE TOOPE Plaintiffs And: TRINITY HISTORICAL SOCIETY INC. aka TRINITY HISTORICAL SOCIETY Defendant - v. -, 2021 NLSC 23

court crest IN THE SUPREME COURT OF NEWFOUNDLAND AND LABRADOR GENERAL DIVISION Citation : Residents of Old Bonaventure v. Trinity Historical Society Inc. , 2021 NLSC 23 Date : February 17, 2021 Docket : 202106G0007 Between: RESIDENTS OF OLD BONAVENTURE as represented by ROSANNE TOOPE Plaintiffs And: TRINITY HISTORICAL SOCIETY INC. aka TRINITY HISTORICAL SOCIETY Defendant - AND - Docket: 202101G0480 Between: TRINITY HISTORICAL SOCIETY INC. Applicant And: Rosanne Toope PUTATIVE REPRESENTATIVE OF THE RESIDENTS OF OLD BONAVENTURE Respondent Before: Justice Garrett A. Handrigan Place of Hearing: Grand Bank, Newfoundland and Labrador

Date of Hearing: January 29, 2021

Summary: The Residents sued the Society for specific performance of an undertaking the Residents claim the Society made to return an historicproperty to them when the Society required it no longer. In the meantime, the Residents also filed a lis pendens at the Registry of Deedsto notify prospective purchasers about the pending litigation. The Residents applied for an interim injunction to prohibit the Society fromselling the property until their claim is resolved and the Society applied to vacate the lis pendens and to strike the Statement of Claim.

The Court allowed the Residents’ application for an injunction but dismissed the Society’s application to vacate the lis pendens and tostrike the Residents’ Statement of Claim. It ordered that costs are in the cause. Appearances: James D. Hughes, Q. C. Appearing on behalf of the Plaintiffs and Respondent John V. O'Dea, Q.C. Appearing on behalf of the Applicant and Defendant Authorities Cited: CASES CONSIDERED: Paro Enterprises Ltd. v. Murphy, 2015 NLCA 33; Infini-T Holdings Ltd. v. Bell Aliant RegionalCommunications Inc., 2010 NLTD(G) 205; RJR-MacDonald Inc. v.

Canada (Attorney General), (SCC), [1994] 1S.C.R. 311; Metropolitan Stores (MTS) Ltd. v. Manitoba Food & Commercial Workers, Local 832, (SCC), [1987] 1S.C.R. 110; Flaherty v. Callahan, 2017 NLTD(G) 79; Bitmain Technologies Limited v. Great North Data Ltd, 2018 NLSC 130 STATUTES CONSIDERED:

Interpretation Act, R.S.N.L. 1990, c. I-19; Registration of Deeds Act, 2009, S.N.L. 2009, c. R-10.01;Family Law Act, R.S.N.L. 1990, c. F-2 RULES CONSIDERED: Rules of the Supreme Court, 1986, S.N.L. 1986, c. 42, Sch. D REASONS FOR JUDGMENT Handrigan, J.: INTRODUCTION [1] On January 19, 2021, the Residents of Old Bonaventure, as represented by Rosanne Toope (“the Residents”) issued aStatement of Claim from this Court (File No. 202106G0007), asking for an order directing the Trinity Historical Society Inc. (“theSociety”) to return to them an historic property the Society owns in their community.

The property is the former St. Luke’s AnglicanChurch, which the Diocesan Synod of Central Newfoundland conveyed to the Society when the Synod closed the Church in 2009 (“theChurch Property”).

The Residents say that the Society undertook with them when it acquired the Church Property not to sell it to a thirdparty, but to return it to them, when the Society no longer required it. [2] The Residents also filed an Interlocutory Application in the same cause asking for an interim injunction preventing the Societyfrom selling the property until issues they raised in their Statement of Claim are dealt with in this Court.

The Residents believed whenthey sought the injunction, correctly, as it now appears, that the Society had accepted an offer from a third party to buy the property andthe sale would close on January 13, 2021.

In fact, the Society and the intended purchaser have extended the closing date to March 12,2021, so the urgency that existed when the Residents asked for the interim injunction is not as great. [3] In the meantime, the Society issued an Originating Application (File No. 202101G0480) on January 8, 2021, asking for anorder vacating a lis pendens the Residents filed on January 6, 2021, at the Registry of Deeds for the Province of Newfoundland andLabrador and dismissing their Statement of Claim.

The Society also filed an Interlocutory Application on January 26, 2021, asking fororders staying the Residents’ Interlocutory Application for the injunction, or, in the alternative, striking the Residents’ Statement of

Claim, as well as vacating the Residents’ lis pendens. With the concurrence of the parties, I heard both Interlocutory Applications onJanuary 29, 2021, and reserved my judgment on them until now. The Issues [4] The Interlocutory Applications raise these issues: 1. Should the lis pendens that the Residents filed in the Registry of Deeds on January 6, 2021 be vacated? 2. Should the Residents be granted an interim injunction prohibiting the Society from selling the Church Property? 3. Should the Residents’ Statement of Claim be struck? The Law Lis Pendens Statute [5] Section 27(2)(25.1) of the

Interpretation Act, R.S.N.L. 1990, c. I-19 says that the phrase “lis pendens”, “…shall be interpretedas having the [same] meaning…” as “pending lawsuits”; about which s. 7(1)(

e) the Registration of Deeds Act, 2009, S.N.L. 2009, c. R-10.01 says as follows: “7(1) The registrar [of Deeds] shall register in paper format or electronically (

e) notices of pending lawsuits…” Case Law [6] In Paro Enterprises Ltd. v. Murphy, 2015 NLCA 33, Welsh, J.A. adopted from the application that led to the appeal, mystatement of the principles that apply to lis pendens. I repeat those principles here: 4 My brother, Leblanc, J. discussed the general law on filing and the effects of lis pendens in this province in Infini-T Holdings Ltd.v. Bell Aliant Regional Communications Inc., 2010 NLTD(G) 205.

In particular, he found that: • A lis pendens is a notice of pending legal action involving an interest in land, and is intended to preserve rights up to and duringthe litigation; it involves an action in rem [a Latin term meaning "against a thing"]. • A registered lis pendens does not constitute a lien or a charge on land but merely clouds the title. • Registering a lis pendens must coincide with filing an action in court claiming an interest or estate in land. • If damages can provide an adequate remedy for the party filing a lis pendens it should not be allowed to stand. • English common law up to December 31, 1832 applies to lis pendens in this province.

Interim Injunction Case Law [7] In RJR-MacDonald Inc. v. Canada (Attorney General), (SCC), [1994] 1 S.C.R. 311, the Supreme Court ofCanada set out what applicants must prove when they ask for interim injunctions: 1. There is a serious issue to be tried; 2. The applicant will suffer irreparable harm if the relief is not granted; and 3.

The balance of convenience favours the applicant. (RJR-MacDonald, pages 44-46, generally) [8] As to the first factor, Cory and Sopinka, JJ.'s said that the "motions judge" should decide whether there is a serious issue to betried "...on the basis of common sense and an extremely limited review of the case on the merits" (RJR-MacDonald, page 44): "Unlessthe case is...frivolous or vexatious...a judge on a motion for relief must, as a general rule, consider the second and third stages ofthe...test" (RJR-MacDonald, pages 45). [9] About "irreparable harm", the learned justices said that it is "...harm which either cannot be quantified in monetary terms orwhich cannot be cured...” and provided examples, including, "...where a permanent loss of natural resources will...result when achallenged activity is not enjoined" (RJR-MacDonald, page 37).

They adopted Beetz, J.'s description of the "third test"from Metropolitan Stores (MTS) Ltd. v. Manitoba Food & Commercial Workers, Local 832, (SCC), [1987] 1 S.C.R.110, where he said that balancing the convenience is "a determination of which of the two parties will suffer the greater harm from thegranting or refusal of an interlocutory injunction, pending a decision on the merits" (RJR-MacDonald, pages 38); and added that "...thefactors which must be considered...are numerous and will vary in each individual case" (RJR-MacDonald, page 38). [10] This is the law which I will apply to the issues in this case.

I turn now to analyze the issues I stated above, starting with thebackground to them. Analysis

Background [ 11 ] Old Bonaventure is a small rural community on the Bonavista Peninsula, in the Trinity Bight area of Trinity Bay. Old Bonaventure has about 33 adult residents within its boundaries, one being Rosanne Toope, who counsel calls the “representative plaintiff” in the Statement of Claim that I referred to earlier in these reasons. Old Bonaventure is also the site of St. Luke’s Anglican Church, an historical property, both by registration and in fact.

In 2008-09, the Diocesan Synod of Central Newfoundland deconsecrated the Church to prepare both for closing and disposing of it. [ 12 ] As might be expected, the Church Property is an important structure in the community. Garland Bailey is a resident of Old Bonaventure. He filed an Affidavit to support the application for an injunction to temporarily halt the sale.

In paragraph 5 of his Affidavit, he noted: “I am also familiar with the property as I considered it to be my Church which I attended for as long as I can recall”. [ 13 ] On January 17 & 18, 2021, 29 of the 33 adult residents of Old Bonaventure signed a petition confirming Ms. Toope “…to represent our Community’s interest in the effort to preserve the property formerly known as St.

Luke’s Anglican Church for the benefit of our Community…” Let me (with an appropriate measure of irony) draw on an advertisement that O’Dea Realty (Chris O’Dea) ran during 2020, when he tried to sell the property for the Society to express the evocative appeal of the Church Property for the Residents. [ 14 ] Mr. O’Dea wrote, in part: “This property should stir the imagination. It is located on one of the bookends of the Trinity Bight in Old Bonaventure and just a short drive to Historic Trinity. Formerly, St.

Luke’s Anglican Church, this 130 year old, registered heritage structure has seen a significant façade restoration, with new clapboard, windows and roof shingles. With just under 2000 square feet of mostly open concept interior space, the building could readily be adapted to a variety of uses, such as a summer home, year-round residence, commercial enterprise such as a craft shop or workshop.

The opportunities are endless…This could be a very exciting real estate opportunity for a visionary.” [ 15 ] Of course, the Residents are also attached to the property for many more reasons than its potential commercial and residential uses. As Mr. Garland alluded to in his Affidavit, the Church Property has been the place where many of the signatories to the petition have witnessed many milestone rites of passage in their lives. [ 16 ] In 2008, as the Diocesan Synod of Central Newfoundland moved to dispose of the Church Property it was sensitive to the interests of the Residents.

As Garland Bailey noted in paragraph 6 of his Affidavit: “…the Church [i.e. Diocesan Synod] approached the Community to take possession/ownership of the buildings for the benefit of the Community and I lead the move to deal with the Church properties on behalf of them”. [ 17 ] The Community contacted the Society and together they agreed upon a process for the properties to be transferred from the Diocesan Synod to the Society, for the benefit of the Residents. Gerald Spurrell, then President of the Society reported to a meeting of the Society on January 18, 2009, about discussions with the Residents.

This extract from the minutes of that meeting captures succinctly how the Residents and Society worked together to acquire the property: Gerald [Spurrell] proceeded to inform the membership that we have been approached by a committee of people from Old Bonaventure with regards to taking over St. Luke’s Anglican Church and school. They approached us as they did not want to start another not-for- profit group in the area and be in competition with us.

The executive met with the committee to gather more information and are now recommending that the membership expand our work to another community in the area, an opportunity to preserve a building, and provide employment. There would be no expenses there as there is no electricity in the church and they do not foresee any need to have it re-connected as the building will only be open seasonally. The school would possibly be taken down on tender and the money used to operate the church and the land turned into a parking lot.

The next step will be to write a letter to the committee in Old Bonaventure informing them of our decision; they would then hold a community meeting and upon agreement we will write a joint letter to the Diocese to begin the process of acquiring the buildings. The motion to proceed was made by peter [sic] Beamish and seconded by Ross Kelly. Motion carried. [ 18 ] On January 30, 2009, Mr. Spurrell followed up on his commitment to write a letter to the Residents.

He solicited their views on removing the school building from the site and was sensitive to their interest in it: The Society has however decided that once the school building is taken over that decision will need to be agreed upon regarding its future. The Society is recommending that a tender be called for the disposal of the building in terms of having it removed from the site and the land being used as a parking area for the two adjacent cemeteries. It is hoped that your committee will be in agreement with this recommendation or some other mutually agreed solution can be reached.

This decision was reached after much discussion of various options as we do not foresee the building having any potential revenue stream in terms of being a rental facility or serving some other function. The Society would use the money acquired from the above to use for any repairs to the church as matching funds towards any grant that are [sic] may be applied for and will place the remainder in trust for sole use towards the operation and upkeep of the church. [ 19 ] Mr. Spurrell framed his discussion of all aspects of acquiring the Church Property as a “partnership” between the Residents and the Society.

So, for example, he introduced the partnership concept in the opening paragraph of his January 30, 2009 letter and he returned to it later with this undertaking: The Society has also agreed that should the partnership not work for some reason or if the Society finds itself in a position where it can no longer operate the building that it would be returned to become the responsibility of the community. [ 20 ] Garland Bailey sent an email to the Society on March 23, 2009, advising that “[w]e held the community meeting on Friday, March 20. The community has agreed to your takeover of the Church and Hall.

We can now arrange for the committee to meet with your group to draft a letter to the Bishop. Thanks”. On December 7, 2009, the Diocesan Synod of Central Newfoundland signed both a bill of sale and a deed of conveyance transferring the Church Property to the Society for a nominal consideration. [ 21 ] It is unclear whether it was a breakdown in the “partnership” between the Residents and the Society or that the Society could no longer operate the Church, but by late 2018, less than a decade after they acquired the property, the Society was “…excited to offer

for lease by Expression of Interest (EOI) space in a landmark heritage structure in the heart of Old Bonaventure, St. Luke’s Church”.

The Society described the structure as “the central landmark in the community” and noted that “ Should there be no applications from residents of Old Bonaventure or none that are accepted THS [Trinity Historical Society] has the right and will release the EOI to a larger audience ” (Emphasis in original). [ 22 ] In the Affidavit he filed to support the Society’s Originating Application, James Miller, General Manager of the Society, noted that the Society received no Expressions of Interest from the Residents, nor from a wider public distribution.

He also notes that the Society sent a notice to the Residents in March 2020, asking if anyone was interested in buying the property, again with no uptake. So, on September 22, 2020, the Society entered into the listing agreement with O’Dea Realty that I referred to earlier in these reasons, as it attempted to sell the property. [ 23 ] Eventually, and evidently through Mr. O’Dea’s intervention, the Society received an offer to buy the property from a third party and it signed an “unconditional agreement of purchase and sale” (see paragraph 17 of Mr.

Miller’s Affidavit) on December 4, 2020, with the closing set for January 13, 2021. [ 24 ] It appears that development galvanized the Residents and spurred them to action.

They retained counsel who wrote to the Society on December 10, 2020, to advise that his clients were informed the Society was selling the Church Property and noted they are “…of the position that you are unable to do so.” Counsel also solicited the Society’s response and said if the Society intended to proceed with the sale, his instructions were to “…file a Lis Pendens”; which he did on January 6, 2021. [ 25 ] This is the background to the two interlocutory applications I am considering. I turn now to discuss the issues I stated above, starting with the Society’s bid to vacate the lis pendens .

Discussion Lis Pendens [ 26 ] The Society attacked the lis pendens the Residents filed at the Registry of Deeds on January 6, 2021 on several fronts: 1. There is no agreement between the Society and the Residents, so that Rosanne Toope as their representative has no legal interest in the Church property to support the lis pendens . 2. The Residents are not a legal entity and have no standing to “cloud the title to the Property by way of a lis pendens. ” 3.

When the Society acquired the Church Property and agreed to preserve it for the benefit of the Residents, that did not create a legal interest in the property, “which…is a legal predicate to a right to file a lis pendens .” 4. Even if the Residents had a right to file a lis pendens , the notice they registered is defective, because: i. The notice does not identify the legal action it refers to. ii. No action had been filed in this Court when the notice was registered; and iii. The registered notice has not been served on the Society. [ 27 ] Let me address each of these arguments in turn. 1.

No Agreement Between the Society and the Residents [ 28 ] I noted earlier how in 2008-2009 when the Society considered taking over the Church Property, it stressed the importance of acting in “partnership” with the Residents. The Society highlighted its concern in the operative letter that it sent to the Residents on January 30, 2009 in which Mr.

Spurrell, the President of the Society, uses the term “partnership” three times. [ 29 ] But other terms and phrases that he uses in his correspondence also evoke the same commitment to working collaboratively with the Residents: “work with your committee”; “The Society is recommending”; “hoped your committee will be in agreement”; “mutually agreed upon solution”; “make ourselves available”; “Should everything be in agreement we would suggest”; and “We look forward to working with members of Old Bonaventure towards an agreed upon common objective.” [ 30 ] My purpose here is self-evident: I want to show that the Society and the Residents believed they were acting in concert when they agreed between themselves that the Society should take over the Church Property.

Their agreement also extended to approaching the Diocesan Synod jointly and requesting that the Synod transfer the Church Property to the Society, for the benefit of the Residents. [ 31 ] The Society now says that it received the property from the Synod unconditionally and further, as it says in the Brief it filed on January 28, 2021, its acquisition of the property from the Diocesan Synod “...was not conditional on an ownership interest in the residents of Old Bonaventure.” In support of the latter assertion, the Society refers to its letter of January 30, 2009 to the Residents, substantial portions of which I quoted above. [ 32 ] The Society’s claim that it did not intend to confer any “ownership interest” in the Residents is disingenuous.

The focal point of the Society’s January 30, 2009 letter to the Residents for this discussion is the undertaking that the Society gave to the Residents that “… should the partnership not work for some reason or if the Society finds itself in a position where it can no longer operate the building that it would be returned to become the responsibility of the community” (Emphasis added). [ 33 ] Those words are an unconditional commitment to return the Church Property outright to the Community of Old Bonaventure.

The Society did not limit itself to leasing it to one or more residents, or even to selling it to one them, as it attempted to do when it called for Expressions of Interest in the fall of 2018. The undertaking is simple, unqualified and indisputable. I note for emphasis that the

parties conducted these discussions between themselves, apparently without legal advice and using their best efforts to achieve what was in their mutual interests. [ 34 ] Earlier I quoted that part of Mr. Spurrell’s January 30, 2009 letter to the Residents in which he laid out the options for the schoolhouse on the land adjacent to the Church Property. I did so to illustrate the considerate manner in which the Society was dealing with the Residents at that time and the care that it took to ensure that the Residents were consulted, informed and agreeable to the Society’s plans for the Church Property.

That is the spirit of the agreement that formed between the Society and the Residents then and to which the Residents are holding the Society now. [ 35 ] In short, there was an agreement between the Residents and the Society, and it lies within the three lines of text from Mr. Spurrell’s letter that contain the Society’s undertaking to the Residents. 2. Residents Not a Legal Entity [ 36 ] It is true that the collective “Residents of Old Bonaventure” are not a legal entity as, for example, the Trinity Historical Society Inc. is.

However, the Residents are a collective entity and they acted collectively when they named Rosanne Toope to represent their interest in these causes. I refer, obviously, to the petition that 88% (29 of 33) of them signed on January 17 & 18, 2021, designating Ms. Toope “…to represent our Community’s interest in the effort to preserve the property formerly known as St. Luke’s Anglican Church for the benefit of our Community…” [ 37 ] Let me note here that Stack, J. of this Court addressed a similar claim when deciding in Flaherty v.

Callahan , 2017 NLTD(G) 79, whether to grant an injunction to restrain the general president of an international union from imposing emergency supervision on a local union under the international constitution. John Flaherty applied for the injunction as “representative of the membership” of the local union. [ 38 ] The international union claimed that there was no evidence that Mr. Flaherty “…has the authority to represent the membership of Local 904 or that he has their support in this proceeding.” Stack, J. referred to Rule 7.11 of the Rules of the Supreme Court, 1986 , S.N.L. 1986, c. 42, Sch.

D and noted two things: Mr. Flaherty had “an arguable case in his own right”, as does Ms. Toope here, whether he had the support of the membership or not; and, otherwise, as the learned justice expressed it himself: As this is an application for an interim injunction and the parties seek a determination of the principal issue on an expedited basis, I intend to restrict my decision to issues that are at the heart of the matter. The Respondents do not deny that the Applicant has a cause of action in his own right.

Therefore, it is not necessary to decide the question of his representative capacity at this stage of the proceeding. ( Flaherty v. Callahan , paragraph 21) 3. Legal Interest in Property Predicate to Filing Lis Pendens [ 39 ] The Society claims that the Residents must have a legal interest in the property before they may give notice of a lis pendens (i.e., a “pending lawsuit”) as to that property. The Society denies that the Residents have any legal interest in the Church Property.

The Society also says that the legal proceedings that benefit from the lis pendens must be an action in rem which it defines, as taken from Bitmain Technologies Limited v. Great North Data Ltd , 2018 NLSC 130 as “…in an action in rem proceeding, the subject of the adjudication is a thing – an item, a property – the ownership interests or possession of which are in issue. The litigation involves competing claims to the property, claims which existed prior to the commencement of the litigation, claims which the court is asked to adjudicate” ( Bitmain , paragraph 62). [ 40 ] Paro Enterprises Ltd. v.

Murphy , was an appeal from my refusal to vacate a notice of lis pendens that Ms. Murphy filed as she sued to protect her interest in property registered to Paro Enterprises Ltd. that she claimed was a matrimonial home under s. 6(3) of the Family Law Act , R.S.N.L. 1990, c. F-2 . The Court of Appeal upheld my decision because Ms. Murphy was not seeking damages but an interest in real property. [ 41 ] As Welsh, J.A. noted in her reasons in Paro Enterprises : “Whether she [Ms.

Murphy] may wish to retain that home upon division of matrimonial property and the possible effects of Paro’s holding title to the property are properly left for consideration at trial based on all the evidence” ( Paro Enterprises , paragraph 9 ). [ 42 ] Here the Residents rely on the Society’s undertaking to return the property to them when it decided to retain it no longer. They, like Ms. Murphy in Paro Enterprises , are claiming an interest in the Church Property and no other relief.

As they say in paragraph 9 of their Statement of Claim: “The Plaintiffs [the Residents] seek specific performance of the agreement and an order compelling the Defendant [the Society] to convey the subject property back to the Community of Old Bonaventure as agreed” (Emphasis added). [ 43 ] The nuances of title to the property, the legal obligations that may or may not flow from the Society's undertaking and any other considerations about the substance of the Residents’ claim cannot be adequately addressed on an interlocutory application. 4.

Notice of Lis Pendens Defective [ 44 ] The Society relies on three grounds when it claims the Residents’ Notice of Lis Pendens is defective: i. The notice does not identify the legal action it refers to; ii. No action had been filed in this Court when the notice was registered; and iii. The registered notice has not been served on the Society. i. Notice Does Not Identify Legal Action

[ 45 ] The Residents filed their Notice of Lis Pendens in the Registry of Deeds on January 6, 2021.

The Notice identified the Residents and the Society as Intended Plaintiff and Intended Defendant respectively, it stated the property affected was the Church Property in Old Bonaventure and it recited the Residents’ intention of “…commencing an action in the Supreme Court of Newfoundland and Labrador against the Intended Defendant.” [ 46 ] It also stated these particulars of the proposed proceeding: “the action to be commenced to enforce an agreement between the parties with respect to the property rights and/or sale, transfer, gifting and/or conveyance of property located at or near the Community of Old Bonaventure formerly known as St.

Luke’s Anglican Church and School…” Appended to the Notice were a metes and bounds description of the property and a surveyor’s plot plan. I find it difficult to imagine how or why the Residents could or should have included a more detailed description of the intended legal action in the Notice to identify it. ii.

No Action Filed When Notice Registered [ 47 ] It is true that the Residents did not file their Statement of Claim in this Court until January 19, 2021, nearly two weeks after they filed their Notice of Lis Pendens in the Registry of Deeds; and one day after the Society filed its Originating Application to vacate the lis pendens on January 18, 2021.

Counsel for the Society sent an unissued copy of the Originating Application to counsel for the Residents on January 15, 2021, without the attachments the Application referred to; whereupon the latter tried unsuccessfully for several days to obtain copies of the same as he prepared to submit the Residents’ Statement of Claim for issuance. [ 48 ] Ultimately, the Residents’ Statement of Claim was not issued until a day after the Society’s Originating Application to vacate the Residents’ lis pendens .

As noted, the Residents filed their Statement of Claim on January 19, 2020 and the Society filed its Originating Application to vacate the lis pendens to which that Statement of Claim refers on January 18, 2021. The timing is relevant to this extent. [ 49 ] In Paro Enterprises , Welsh, J.A. summarized the “principles and procedures” that apply to “registering and vacating a notice of lis pendens”, amongst which are these: 5. If a lis pendens is registered and litigation has not been commenced, application to the court will result in the lis pendens being vacated with an appropriate order for costs. 6.

As discussed above, if a lis pendens is registered before litigation is commenced, but litigation is subsequently commenced before an application is made to vacate the lis pendens , the coincidence of the lis pendens and commencement of litigation operates to make the lis pendens effective as of the date of coincidence. ( Paro Enterprises v.

Murphy , paragraph 31 ). [ 50 ] While the Residents had not started their action when they filed their Notice of Lis Pendens on January 6, 2021, and did not do so until January 19, 2021, their lis pendens and action coincided on the later date and the Notice was effective as of that date. It matters not that the Society filed its Originating Application a day before the Residents filed their Statement of Claim.

It is the date on which I heard the Society’s Interlocutory Application to strike the lis pendens , January 29, 2021 that is relevant and by that time, to paraphrase Welsh, J.A. in Paro Enterprises , the coincidence of the lis pendens and commencement of litigation operated to make the lis pendens effective as of the date of coincidence. iii. Registered Notice Not Served on Society [ 51 ] Although the Society listed this in its Originating Application as one of its reasons for questioning the validity of the lis pendens , it did not develop it further in its brief.

I have no evidence that the Residents formally served the Society with a copy of the registered Notice of Lis Pendens , and think it is unlikely that the Residents did effect service of it. [ 52 ] That said, the Residents provided the Society with ample notice of its intention to file the Notice in the Registry of Deeds. First of all, the Residents’ counsel wrote to the Society by registered letter on December 10, 2020, and advised that the Residents were informed the Society intended to sell the Church.

Counsel ended his letter with this advice: “We trust that we will not have to take further action to prevent the sale therefore we ask you to confirm your position within 5 days, otherwise we will be forced to file a Lis Pendens.” [ 53 ] I note further that James Miller, General Manager of the Society wrote to counsel for the Residents on January 12, 2021, sending his letter by email, in which he said: “It has come to our attention that a lis pendens dated January 4, 2021 has now been filed at the Registry of Companies and Deeds on January 4, 2021, though no copy of the registered notice has been provided to the Trinity Historical Society Inc...”. [ 54 ] Subsequently, on January 15, 2021 the Residents’ counsel wrote to counsel for the Society providing a “…copy of the Lis Pendens filed January 7 th , 2021 (Registration No. 961601) sent for filing on January 6, 2021.” It turned out, of course, that the Notice of Lis Pendens was actually filed at the Registry of Deeds on January 6, 2021, as confirmed by the Certificate of Registration. [ 55 ] I am satisfied that the Society received adequate notice of the lis pendens the Residents filed in the Registry of Deeds to inform anyone dealing with the Church there was a lawsuit pending with respect to it. [ 56 ] Overall, I find that the Residents registered a Notice of Lis Pendens against the Church Property in the Registry of Deeds for Newfoundland and Labrador on January 6, 2021 and it is valid and effective.

I will not vacate it. Interim Injunction

[ 57 ] On December 4, 2020, the Society entered into an unconditional agreement of purchase and sale with one Joshua Dawson for the Church Property. Mr. Dawson and the Society agreed that the transaction would close on January 13, 2021 (since extended to March 12, 2021), and Mr. Dawson would acquire the property for $45,000.

On December 15, 2020, James Miller, General Manager of the Society wrote to counsel for the Residents noting that “[a]s there is a binding unconditional agreement for the sale of the property THS [Trinity Historical Society] is bound to the sale of the Church”. [ 58 ] The Residents applied by Interlocutory Application on January 22, 2021, to enjoin the sale to Mr.

Dawson by an interim injunction pending the outcome of the claim they filed on January 19, 2021, in which they ask for an order directing the Society to return the Church property to them. [ 59 ] To succeed in their application the Residents must show three things: 1. There is a serious issue to be tried; 2. The applicant will suffer irreparable harm if the relief is not granted; and 3. The balance of convenience favours the applicant. Let me examine each of these factors in the context of these proceedings. 1. Serious Issue [ 60 ] In RJR-MacDonald v.

Canada , Cory and Sopinka, J.J.’s directed that the "motions judge" should decide whether there is a serious issue to be tried "...on the basis of common sense and an extremely limited review of the case on the merits" ( RJR-MacDonald , page 44): "Unless the case is...frivolous or vexatious...a judge on a motion for relief must, as a general rule, consider the second and third stages of the...test." [ 61 ] It is clear from RJR-MacDonald that the Residents have to achieve a relatively low threshold of proof to show that their claim raises a serious issue to be tried.

The bar is generally set at showing that their case is neither frivolous nor vexatious. The Residents meet that threshold here. Let me explain. [ 62 ] In 2008-2009, the Diocesan Synod of Central Newfoundland was ready to close St. Luke’s Anglican Church in Old Bonaventure. The Synod approached the community to see if it was interested in taking over the property, which the Residents were.

But the Residents were well aware of the prominence of the Society in the region and the good work it was doing in preserving and operating historical properties. [ 63 ] The Residents did not want to compete with the Society, so they chose the next best, and obvious route – they invited the Society to acquire the property and operate it for their benefit.

Over several months, the Society and the Residents consulted, debated and eventually formed a partnership to approach the Diocesan Synod jointly, by which the Residents directed the Synod to transfer the property to the Society, foregoing the possibility of acquiring it themselves. [ 64 ] The Society now claims that it received the property from the Synod unconditionally, which it did vis-à-vis the Synod, but not as between the Society and the Residents.

Gerald Spurrell, the President of the Society wrote to the Residents on January 30, 2009 and gave this undertaking to them: “…should the partnership not work for some reason or if the Society finds itself in a position where it can no longer operate the building that it would be returned to become the responsibility of the community”. [ 65 ] The Residents now believe that the Society is trying to welch on its undertaking and their belief lies at the root of their claim. I have no reason to believe the Residents are acting frivolously or vexatiously.

They have raised a serious issue to be tried in their Statement of Claim and 88% of the Residents stand behind it. They have met the burden of proof on them. 2. Irreparable Harm [ 66 ] In RJR-MacDonald v. Canada , Cory and Sopinka, J.J.’s said that "irreparable harm", is "...harm which either cannot be quantified in monetary terms or which cannot be cured...” In this case, the Residents are calling on the Society to honour its undertaking to “return property to them”, now that the Society no longer requires it.

They ask for an order from this Court directing the Society to “specifically perform” its agreement. [ 67 ] No other remedy will meet the Residents’ request, neither damages nor declaratory orders; and if the Society may sell the Church Property to Mr. Dawson, or any other third party, before the issues between the Residents and the Society are resolved in this Court, the remedy the Residents want will not be available. Or, to put it another way, they will suffer irreparable harm if the Society is allowed to sell the property pending these proceedings. 3.

Balance of Convenience [ 68 ] Balancing the convenience between the parties is simply, again from RJR-MacDonald v. Canada , "a determination of which of the two parties will suffer the greater harm from the granting or refusal of an interlocutory injunction, pending a decision on the merits." [ 69 ] If the Society is permitted to sell the Church Property, the Residents will suffer the greater harm: The property will be gone and unavailable to them if they succeed in their claim and this Court orders the Society to return the property to them. The Society says that their pending sale of the property to Mr.

Dawson will be stalled by an injunction – it already has been delayed by two months – and may be lost completely if the injunction prohibits it from selling the property pending the conclusion of the Residents’ claim. [ 70 ] I acknowledge the risk to the Society that an injunction creates. However, it is a smaller risk than the possibility of the irreparable harm to the Residents that allowing the Society to sell the property would entail. On balance, convenience favours the

Residents. [ 71 ] Overall, I am satisfied that the Residents have shown they are entitled to injunctive relief and I order that an injunction will issued prohibiting the Society from selling the Church Property pending the resolution of the Residents’ claim against the Society. One Further Matter [ 72 ] The Society also included a claim in its Interlocutory Application that I strike the Residents’ Statement of Claim because the Respondents have no legal interest in the Church Property. I have addressed this issue fully in my discussion of the lis pendens and I adopt that discussion here to reject the Society’s request to strike the Statement of Claim. Costs [ 73 ] Costs are in the cause.

Summary and Disposition [ 74 ] The Residents sued the Society for specific performance of an undertaking the Residents claim the Society made to return an historic property to them when the Society required it no longer. In the meantime, the Residents also filed a lis pendens at the Registry of Deeds to notify prospective purchasers of the property about the pending litigation.

The Residents applied for an interim injunction to prohibit the Society from selling the property until their claim is resolved and the Society applied to vacate the lis pendens and to strike the Statement of Claim. [ 75 ] The Court allowed the Residents’ application for an injunction but dismissed the Society’s application to vacate the lis pendens and to strike the Residents’ Statement of Claim. It ordered that costs are in the cause. Order [ 76 ] In the result, I order that: 1.

An injunction will issue prohibiting the Society from selling the Church Property pending the resolution of the Residents’ claim against the Society. 2. The Society’s application to vacate the lis pendens the Residents filed in the Registry of Deeds on January 6, 2021 is dismissed. 3. The Society’s application to strike the Residents’ statement of claim is dismissed. 4. Costs are in the cause. _____________________________ Garrett A. Handrigan Justice