2019 NLCA 75, 2019 NLCA 75

Vincent Lee (applicant/appellant) v. Melissa Lee (respondent) (19/88) Indexed As: Lee v. Lee 2019 NLCA 75 5 C.A.N.L.R. 198 Court of Appeal of Newfoundland and Labrador O’Brien J.A. December 10, 2019

Summary: Mr. Lee applied for a stay of enforcement of an order from the Supreme Court of Newfoundland and Labrador, Family Division, pendingthe disposition of an appeal. The order in question stipulated that the parties must cooperate to arrange the sale of their matrimonial homeand that if the property was not sold within 90 days of the order, Mr. Lee must vacate the property within 100 days of the order. Held: Application allowed, in part. O’Brien J.A.: An application for a stay pending enforcement of an order may be brought pursuant to rule 42 of the Court of AppealRules.

The test to be applied is set out in RJR MacDonald Inc. v. Canada (Attorney General) (paragraphs 10-12). The first stage of the test, whether there is a serious issue or ground to be argued, sets a low threshold involving consideration of whetherthe appeal is frivolous or vexatious (paragraph 14). That threshold was satisfied in this case (paragraphs 15-16). The second stage of the test is whether the applicant will suffer irreparable harm if the stay is not granted. It is the nature, not themagnitude of the harm that is the focus (paragraphs 17-18).

In this case, requiring the applicant to vacate the house before it is sold maybe detrimental to obtaining the best sale (paragraphs 19-21). The third stage of the test requires a balancing of inconvenience as between the parties, which, in this case resulted in a partial stay of theorder (paragraphs 22-27). Consideration was given to the incidental impact on the best interests of a child insofar as access to the house would affect parental timewith the child (paragraphs 28-29). In the result, the requirement that Mr.

Lee vacate the property pending its sale was stayed pending the disposition of the appeal(paragraph 31). Cases cited: RJR MacDonald Inc. v. Canada (Attorney General), (SCC), [1994] 1 S.C.R. 311 Canada (Royal Canadian MountedPolice) v. Rees, 2005 NLCA 4, 244 Nfld. & P.E.I.R. 72 Weir’s Construction Limited v. Warford Estate, 2016 NLCA 65, 1 C.A.N.L.R. 282 R.E. v. N.G., 2010 NLCA 60, 301 Nfld. & P.E.I.R. 240

Rules considered: Court of Appeal Rules, NLR 38/16, rule 42 Counsel: Appearing on his own behalf, the applicant/appellant; Timothy O’Brien for the respondent. The application was heard on December 3, 2019 before O’Brien J.A. The following judgment was filed on December 10, 2019 by O’Brien J.A. ______________________________________________________________ O’Brien J.A.: [1] On September 26, 2019, a Justice of the Supreme Court of Newfoundland and Labrador, Family Division, made an orderrelating to the sale of the matrimonial home of Mr. Vincent Lee and Ms. Melissa Lee. [2] The order provided that Mr. Lee and Ms.

Lee would cooperate to arrange for the sale of the home within 90 days of the order. Itfurther mandated that, in the event the home was not sold in this 90-day period, Mr. Lee would be required to vacate the home 100 daysafter the order and Ms. Lee would then be solely authorized to have the home appraised, listed for sale and sold. [3] Mr. Lee has appealed the order and has applied for a stay of the order pending the disposition of the appeal. [4] The application for a stay of the order pending the appeal was heard on December 3, 2019.

At the stay application hearing, Mr.Lee indicated that he understood that the home needed to be sold so that both he and Ms. Lee could receive their respective financialinterests with respect to the home. This was not contested. [5] Mr. Lee’s main submission was that he should not be required to vacate the home before it is sold. Mr. Lee advised this Courtthat he has had sole possession of the home since he and Ms. Lee separated in 2016. Since that time, Mr.

Lee advised, he has paid allcosts associated with the home, including the mortgage payments, payments on an additional collateral loan which encumbrances thehome, utility costs, insurance, maintenance and taxes. [6] He further advised that, should he be required to vacate the home before sale, he did not have the means to continue paying theexpenses related to the home in addition to the extra expenses which he would incur living elsewhere. Mr. Lee submitted that Ms. Leehas not indicated that she would take over these payments and, in Mr. Lee’s view, Ms. Lee would not be in a financial position to do so. [7] Mr.

Lee submitted that, as a result, should he be required to vacate the home, the mortgage and other expenses would not becovered during the period when the house was listed for sale, and that this would not be in either party’s interests. [8] It was further argued by Mr. Lee that he did not have an adequate opportunity to advise the Court below of the potential negativeconsequences of an order requiring him to vacate the home before sale. He noted that neither party had asked the Court below to requireMr. Lee to vacate the home before sale (the request was for an order that the house be sold). Mr.

Lee argues that he should have had anopportunity to address this issue, of vacating the property, in the Court below. [9] At the stay application hearing, the parties indicated they might be able to resolve the matter by consent, especially in light ofMr. Lee’s stated position that he was not opposed to having the house sold. As such, the Court provided the parties a period of severaldays to explore settlement, failing which the Court indicated it would decide whether a stay would be ordered. The parties subsequentlyadvised that no agreement could be reached.

Stay of Enforcement of an Order Under Appeal [10] An application for a stay of enforcement of an order under appeal can be considered by the Court of Appeal under rule 42 of theCourt of Appeal Rules, NLR 38/16. [11] The test for a stay pending appeal was set out by the Supreme Court of Canada in RJR MacDonald Inc. v. Canada (AttorneyGeneral), (SCC), [1994] 1 S.C.R. 311. [12] This test has been applied in this Court, as discussed in Canada (Royal Canadian Mounted Police) v. Rees, 2005 NLCA 4, 244Nfld. & P.E.I.R. 72.

The test in RJR MacDonald continues to apply to an application for a stay pending appeal under the current Court ofAppeal Rules, which came into force in 2016 (see Weir’s Construction Limited v. Warford Estate, 2016 NLCA 65). [13] The test in RJR MacDonald requires consideration of three questions. These are:

(1) Is there a serious issue or ground to be argued on appeal?

(2) Will the applicant suffer irreparable harm if the stay is not granted?

(3) What is the balance of inconvenience, as between the parties, of granting or refusing the stay? Is there a serious issue to be argued on appeal? [ 14 ] In considering whether there is a serious issue to be argued on appeal, this Court will conduct only a limited analysis on the merits of the appeal, and need not consider the likelihood of ultimate success.

The inquiry on a stay application involves consideration of whether the appeal is frivolous or vexatious ( Weir’s Construction Limited , paragraph 16 ) and, as has been frequently observed, this step of the test has a very low threshold. [ 15 ] In this case, Mr. Lee (in both the notice of appeal and the application for a stay) submitted that “there was no consideration for [his] right to have such an important matter considered for its full merit”, and that “the Court has ignored [his] evidence and made a judgment without weighing all the factors or giving proper merit to the facts”. Based on Mr.

Lee’s submissions at the hearing, and the submissions above, Mr.

Lee appears to be raising, as a ground of appeal, the argument that the decision to order him to vacate the home was made without a full opportunity to be heard on this issue or to advise the Court of the possible negative consequences which might result from such a decision. [ 16 ] Without commenting on or determining the ultimate likelihood of success of this argument on appeal, it cannot be said that the argument is frivolous and vexatious; as such, it is sufficient in this circumstance to meet the low threshold required for establishing a serious issue to be argued on appeal.

Will the applicant suffer irreparable harm if the stay is not granted? [ 17 ] The test does not require a conclusive finding that a party will suffer irreparable harm if the stay is not granted. Rather, it has been observed that a “credible reason for uncertainty” may be sufficient at this stage. The degree of certainty required entails a contextual inquiry specific to the circumstances of each case ( see Canada (Royal Canadian Mounted Police) v.

Rees , at paragraph 60 ). [ 18 ] The focus under this stage of the test is on the nature of the harm that a party may suffer, not the magnitude of the harm ( Weir’s Construction Limited , at paragraph 17 ) . [ 19 ] In this case, Mr. Lee argues that irreparable harm may result from the requirement to vacate the home because, as discussed above, he would not be able to pay the expenses of living elsewhere while paying the mortgage, utilities, insurance, etc., on the home. Further, there was no indication that Ms.

Lee has the ability or willingness to cover these expenses. [ 20 ] Therefore, depending on the time required to sell the house, the possibility exists that the mortgage or collateral loan may fall into default (possibly resulting in a secured party taking action), that utilities will be unpaid (raising the possibility of services being disconnected in winter with possible resulting damage to the home) and, as the house may be empty for some period before sale, there is a further possible uncertainty in terms of compliance with insurance requirements. [ 21 ] In the present circumstances, I would conclude that the irreparable harm requirement of the test has been met with respect to the part of the order that requires Mr.

Lee to vacate the home before sale.

What is the balance of inconvenience, as between the parties, of granting or refusing the stay? [ 22 ] The Supreme Court of Canada in RJR MacDonald (page 342) described the “balance of inconvenience” between the parties as one engaging “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.” [ 23 ] This Court has noted that, at this stage, what is being balanced is the “potential for harm” between the parties, and the Court need not determine what “actual harm” will result to each party if the stay is not granted ( Canada (Royal Canadian Mounted Police) v.

Rees , at paragraph 61 ). [ 24 ] In this instance, both parties are claiming that harm will result. Ms. Lee’s biggest concern appears to be the fact that, until the home is sold, she cannot receive her financial interest in the matrimonial home. She also indicated that this has negatively impacted her ability to access credit. [ 25 ] However, the ability of Ms. Lee to sell the home in accordance with the order is not necessarily fettered by Mr. Lee’s occupation of the home. The two are not mutually exclusive. Mr.

Lee indicated to the Court that it is in his interest to have the house sold for the best price, and that he would act so as to facilitate, and not obstruct, the home’s sale while living in the home. [ 26 ] As discussed, Mr. Lee’s concern is the potential for harm occasioned by the house being vacant and the expenses not being paid. He describes potential harm to the value of the home which might negatively impact his, as well as Ms.

Lee’s, respective interests. [ 27 ] In these circumstances, in my view the balance of inconvenience weighs in favour of granting a stay with respect to the part of the order requiring Mr. Lee to vacate the home before sale. To address her concerns, Ms. Lee would still be authorized to take steps to have the house sold, in accordance with the order. Incidental impact on the best interests of a child [ 28 ] Finally, Mr. Lee also submitted that the parties have a joint (50-50) arrangement regarding parenting of their child, and that the child lives with Mr. Lee, in the home, half of the time.

As such, an incidental consideration in this stay application is the potential impact on the parenting arrangement, in that Mr. Lee advised the Court that he does not presently have alternative living arrangements secured.

This may negatively impact his ability to exercise his parenting rights and responsibilities, at least until appropriate alternative living arrangements are in place. [ 29 ] In R.E. v. N.G ., 2010 NLCA 60 , 301 Nfld. & P.E.I.R. 240 , it was noted that the test for a stay might need to be modified in the context of a dispute regarding parenting, in order to take into account the perspective of the best interests of the child.

While the present dispute does not directly deal with parenting, but rather is about property division in a family law context, the indirect possible impact on the best interests of the child, and the ability of Mr. Lee to exercise parenting rights, while certainly not determinative, might nonetheless be relevant. To the extent this may be a relevant consideration, it would be an additional factor favouring a stay of the portion of the order that requires Mr. Lee to vacate the home before sale.

DISPOSITION [ 30 ] In the result, and for the reasons provided above, having applied the test for a stay set out in RJR MacDonald (as followed by this Court in many cases, including in Canada (Royal Canadian Mounted Police) v. Rees and in Weir’s Construction Limited ) , I conclude that a partial stay should be ordered pursuant to rule 42(2) of the Court of Appeal Rules . [ 31 ] Specifically, clause 3(

a) of the September 26, 2019 order under appeal is stayed pending the disposition of the appeal. Clause 3(

a) states: “The Respondent, Vincent Anthony Lee, shall vacate the home 100 days following the date of this order.” The order remains effective in all other respects. [ 32 ] Mr. Lee has filed an appeal book and factum and the transcript of the hearing in the Court below has also been filed. Once Ms. Lee’s factum is filed, the parties may request a date for the hearing of the appeal. [ 33 ] There shall be no order as to costs on the application. Application allowed, in part.