2017 QCCQ 15116, 2017 QCCQ 15116

Fiducie familiale Fedida c. Li 2017 QCCQ 15116 COURT OF QUEBEC CANADA PROVINCE OF QUEBEC DISTRICT OF MONTREAL “Civil Division” No: 500-22-240810-179 DATE: December 21, 2017 ______________________________________________________________________ BY THE HONOURABLE JEFFREY EDWARDS, J.C.Q. ______________________________________________________________________ FIDUCIE FAMILIALE FEDIDA Plaintiff v.

DONG YI LI Defendant ______________________________________________________________________ JUDGMENT ______________________________________________________________________ Overview [ 1 ] Plaintiff Fiducie Familiale Fedida ( Fedida ) claims outstanding rent and other damages from Defendant Dong Yi Li pursuant to a commercial lease dated October 1, 2015 (“ Second lease ”) [1] . Ms. Li states that she never agreed to that lease and that the only lease to which she is bound is the previous lease dated March 1, 2007 (“ First Lease ”) [2] .

Context [ 2 ] The Second Lease is a lease on a “net net net” basis, allowing Plaintiff Landlord to claim, in addition to the rent, all taxes and operating costs associated with the premises and the building. [ 3 ] The First Lease only provided that the Lessee pay base rent [3] as well as certain taxes, including business tax [4] and a surtax, when and if applicable [5] . The First Lease specifically excluded any real estate tax, including municipal or school taxes [6] . [ 4 ] On September 21, 2015, Ms. Li became Lessee when she purchased the business on the premises.

She has paid all monthly lease rental payments since that time except for the months of November and December 2017. The current monthly base rent recognized by Ms. Li is $3,190.

[ 5 ] Ms. Li has only paid part of the additional rental amounts claimed. [ 6 ] On July 28, 2017, Fedida instituted the present legal proceedings claiming additional amounts under the Second Lease. [ 7 ] On August 25, 2017, pursuant to an application for a safeguard order for the alleged outstanding additional rental amounts, including taxes and operating costs, the Court ordered Ms. Li to pay a monthly amount recognized as owed under the First Lease. The monthly amount determined was $954.90. Ms.

Li was ordered to pay that amount for the months of September through to December 2017, totalling $3,819.59 within 20 days of the safeguard order [7] . Ms. Li has paid that amount. [ 8 ] The safeguard order also ordered Ms. Li to pay $954.90 per month on an ongoing basis, in addition to the base rent, until final adjudication of Fedida’s claim on the merits. [ 9 ] After paying the $3,819.59, Ms. Li failed to pay the amount of base rent for November and December 2017.

On November 29, 2017, Fedida obtained another safeguard order for payment of the base rent of $3,190 for the months of November and December 2017, being a total of $6,380 [8] . The safeguard order required payment by December 4, 2017. [ 10 ] Ms. Li is now in default with regard to that safeguard order. Counsel for Fedida requests to strike the defence, as stated in the safeguard order as the consequence of default, and to proceed to judgment on the merits of its claim. [ 11 ] Furthermore, counsel for Fedida states that Ms.

Li has now abandoned the premises. [ 12 ] Fedida ask the Court to declare the lease resiliated and to condemn Ms. Li to pay the amounts owed and other damages. Analysis and Decision [ 13 ] The Court has reviewed the file, including the affidavits filed by the representative of Fedida dated December 6, 2017 and by Ms. Li dated August 24, 2017. [ 14 ] The Court considers that the preponderance of the evidence supports Ms. Li’s version of events and that the only valid lease between the parties is the First Lease. [ 15 ] In light of this conclusion, the Court will determine the amounts owed by Ms.

Li to Fedida under the First Lease. [ 16 ] Fedida has a right to claim the base rent of November and December as already ordered by this Court. The attorney of Fedida confirmed to the Court that his client renounces to the conclusion in the previous safeguard order dated November 29, 2017 regarding the amounts of base rent of November and December in order to claim those amounts in the present judgment. [ 17 ] Accordingly, the Court will condemn Ms. Li to pay that amount, namely $6,380. [ 18 ] In light of Ms.

Li’s default under the First Lease, Plaintiff is also entitled to compensation for a reasonable period of time to find a new tenant for the premises. The Court considers that, in the circumstances, a period of two (2) months is sufficient (January and February 2018).

[ 19 ] Fedida is also entitled to claim an additional rental amount for this period. In light of the evidence, the Court will grant $1,909.90 (2x $954.45). [ 20 ] Fedida does not claim any additional rent for 2015. [ 21 ] Fedida only claims an amount for additional rent in 2016. On the same basis, the Court will award for that year the amount of $11,458.80 (12 x $954.90). However, Fedida admits to have already received payment of $10,293.86 in that regard [9] .

That leaves an outstanding amount of $1,164.94. [ 22 ] For 2017, the amount for additional rent from January to August remains unpaid: $7,639.20 (8 x $954.90). [ 23 ] Fedida also claims certain additional amounts for alleged bad faith of Ms. Li ($2,500) and for legal fees paid for alleged abuse of proceedings ($9,153.02). Until November 2017, Ms. Li always paid the base rent for the premises. She has paid a part of the additional rent. For this reason, the Court does not consider that Ms. Li has acted in bad faith in the present matter. There has been no abuse of proceedings.

The claim for these amounts will therefore not be granted. [ 24 ] Fedida also claims a penalty amount of 12 months rent under the First Lease [10] . However, under

article 1622 of the Civil Code of Quebec ( C.C.Q. ), a creditor cannot claim at the same time damages and a stipulated penalty in lieu of damages. Accordingly, that amount will not be granted. [ 25 ] Regarding interest and the additional indemnity, as Fedida waited until July 28, 2017 to institute proceedings for amounts that were owed for more than a year at the time, interest and additional indemnity will be granted only from the institution of the legal proceedings. [ 26 ] Ms.

Li owes Fedida the following amounts: Base Rent for November and December 2017 $6,380 Base Rent of January and February 2018 $6,380 Additional Rent January and February 2018 $1,909.80 Additional Outstanding Rent 2016 $1,164.94 Additional Outstanding Rent 2017 $7,639.20 $23,473.94 Conclusion

[ 27 ] In

summary, Ms. Li owes Fedida the following amounts bearing interest and additional indemnity from the dates specified: (

a) Base rent November and December 2017 - $6,380, Interest and additional indemnity from December 1, 2017; (

b) Compensation for loss of rent of January and February 2018 - $6,380. Interest and additional indemnity from the present judgment; (

c) Additional rent of January and February 2018 - $1,909.80. Interest and additional indemnity from the present judgment; (

d) Additional outstanding rent 2016 - $1,164.94. Interest and additional indemnity from July 28, 2017; (

e) Additional outstanding rent 2017 - $7,639.20. Interest and additional indemnity from August 1, 2017. FOR THESE REASONS, THE COURT: DECLARES RESILIATED the Lease Agreement between the parties; CONDEMNS Dong Yi Li to pay Fiducie Familiale Fedida the amount of $23,473.94 as follows: (a) $6,380 with legal interest of 5% per year, plus the additional indemnity provided at

Article 1619 of the Civil Code of Quebec , starting from December 1, 2017; (b) $6,380 with legal interest of 5% per year, plus the additional indemnity provided at

Article 1619 of the Civil Code of Quebec , starting from the present judgment; (c) $1,909.80 with legal interest of 5% per year, plus the additional indemnity provided at

Article 1619 of the Civil Code of Quebec , starting from the present judgment; (d) $1,164.94 with legal interest of 5% per year, plus the additional indemnity provided at

Article 1619 of the Civil Code of Quebec , starting from July 28, 2017; (e) $7,639.20 with legal interest of 5% per year, plus the additional indemnity provided at

Article 1619 of the Civil Code of Quebec , starting from August 1, 2017. AUTHORIZES Fiducie Familiale Fedida to dispose of any property of Ms. Dong Yi Li left on the leased premises at 5236, Queen Mary Road, City of Montreal; WITH LEGAL COSTS . __________________________________ Jeffrey Edwards, J.C.Q.

Me Eric De Louya (Present) De Louya Markakis Attorneys for Plaintiff Me Craig Berger (Absent) Attorney for Defendants Date of hearing: December 11, 2017