Wilson v. Sheppard, 2023 NSSM 41

SMALL CLAIMS COURT OF NOVA SCOTIA Citation: Wilson v. Sheppard , 2023 NSSM 41 ON APPEAL FROM AN ORDER OF THE DIRECTOR OF RESIDENTIAL TENANCIES Date: 202306 02 Docket: SCN 520389 Registry: Sydney Between: Jordan Wilson Appellant (landlord) - and - Gerald Sheppard Respondent (tenant) REASONS FOR DECISION AND ORDER Adjudicator : Eric K. Slone Heard : via zoom in Halifax, Nova Scotia on May 30, 2023 Appearances : For the Appellant (landlord), Self-represented For the Respondent (tenant), Self-represented BY THE COURT : [ 1 ] This is an appeal by the landlord from a decision of the Director of Residential Tenancies dated December 19, 2022, which

ordered the landlord to pay to the tenant $6,000.00 as compensation for having breached an agreement to lease a property to the tenant. [ 2 ] The landlord was the owner of a duplex at 122 Mariner Drive in the Westmount area of Sydney, Nova Scotia (“the Mariner property”). On June 17, 2022, he agreed to lease one of the units to Gerald Sheppard and his wife, Catherine Sheppard. The Sheppards were in the process of selling their own home in a downsizing move. A standard form of lease was signed on June 17, 2022, with a start date of September 15, 2022. The rent was $2,000.00 per month.

The term was fixed for one year. A security deposit of $1,000.00 was provided at that time. [ 3 ] Mr. Sheppard testified that the Mariner Drive duplex “checked all the boxes” in the sense that it was reasonably spacious and was all on one level as Ms. Sheppard has mobility issues. It also had adequate parking space for their vehicles. [ 4 ] Mr. Wilson testified that soon thereafter he began to be pursued by a real estate agent with an unsolicited offer to buy the Mariner property on behalf of Kameron Coal Ltd.

He first refused to sell but when the offered price kept rising he eventually agreed to sell, at or about the end of July 2022. No details of the sale price were disclosed in this hearing. [ 5 ] As he must have been keenly aware, he could not lease the property to one person and sell it to another. [ 6 ] There are diverging versions of what happened next. [ 7 ] Mr. Wilson testified that he informed Mr. Sheppard on or about August 1 that there was a change of plans.

He testified that he made arrangements for the Sheppards to rent a different duplex unit on Petersfield Court from someone named Sandip Shah, which he believed would suit them. That duplex was still under construction. Mr. Wilson testified that there was a “gentleman’s agreement” to accept the substitution. He therefore believes that he did not need take any formal steps to cancel the lease on Mariner, and denies that he owes the Sheppards any form of compensation. [ 8 ] Mr. Sheppard testified that he did not learn that the Mariner property had been sold until he called Mr.

Wilson on or about the 1 st of September, just to confirm that everything was in place for the upcoming move. He says that he was shocked to learn that the property was being sold. By then, they had already sold their house with a closing in mid-October. [ 9 ] Ms. Sheppard confirmed that she knew nothing about the change of plans until her husband told her after this call on or about September 1. [ 10 ] Mr. Sheppard testified that he believed he still had the right to take occupancy even if the ownership changed, because the new owner would inherit the tenancy. But this was not really a feasible strategy.

The new owner had occupants ready to take possession at the same time. [ 11 ] Mr. Sheppard testified that he was unaware of any arrangements being made by Mr. Wilson, and that he never made any agreement (gentleman’s or otherwise) to accept a substitution. [ 12 ] To make a long story short, the Sheppards ended up moving into the duplex on Petersfield Court in mid-October that Mr. Wilson said he had arranged. They did not find it adequate for their needs and ended up building a new home for themselves on a building lot that they already owned.

They moved out of Petersfield after only about six months. [ 13 ] In the meantime, on October 24, 2022, Mr. Sheppard initiated the application to Residential Tenancies. This was mere days after they had moved into Petersfield. [ 14 ] The application came before Residential Tenancy Officer Kim Sinclair on December 12, 2022. Mr. Wilson did not attend, for what he later disclosed were personal family reasons, and so the Officer only heard one side of the story. This is unfortunately not unusual in the Residential Tenancies world.

[ 15 ] The Residential Tenancies Officer found that the landlord did not follow any of the required steps under the Residential Tenancies Act for when a property is being sold. She found that the landlord did not file an application to terminate the tenancy with Residential Tenancies, nor did he issue a valid Notice to Quit. [ 16 ] This is not a matter of someone in good faith following the wrong procedure, which procedures may sometimes be difficult to follow. Here the landlord did precisely nothing from a legal standpoint.

In fact, there was not a single document filed by the landlord either at Residential Tenancies or before this court, to substantiate that any formal steps were taken. [ 17 ] The Residential Tenancies Officer awarded the tenant $6,000.00, corresponding to three months of the agreed-upon rent as compensation for all of the hardship and inconvenience, in lieu of having been given any proper notice under the Act. [ 18 ] Mr.

Wilson eventually appealed the order of the Director, after having been given leave to file his appeal late because he missed the 10-day deadline. [ 19 ] The matter eventually came before me on May 30, 2023. Neither of the parties is at fault for the scheduling to have taken so long; this was all as a result of internal issues with the court. [ 20 ] In the days leading up to the court hearing, which took place by zoom, both parties were sending emails to me complaining about the behaviour of the other party. Mr.

Wilson complained that he had several witnesses lined up, but that they were interfered with by way of intimidation or inducements by Mr. Sheppard. Mr. Sheppard complained that he was receiving harassing texts from Mr. Wilson at all hours, sending photographs of purported text exchanges involving third parties. [ 21 ] I refused to hear any evidence from either party about these behaviours. As for potential interference with witnesses, I adhere to the long-held view that there is no property in a witness.

What that means is that it is not improper to speak to the other party’s witnesses, and what comes of those discussions is not a matter of concern to the court. If anything improper happened, such as improper intimidation of a witness, that could be a matter for a criminal complaint, but as a Small Claims Adjudicator I have no authority to police such activity. As I informed Mr. Wilson before the hearing, if his witnesses were now reluctant to testify, then he had the option of issuing subpoenas for their testimony. He did not take me up on this suggestion.

As such, the hearing went ahead without any of his witnesses. [ 22 ] I will add that several hours after the hearing was complete, Mr. Wilson sent an email asking if the hearing could be opened up to have these witnesses called, or if I would be willing to allow them to comment by email. I ruled that this was unfair and improper, as the hearing had been concluded and I was already in the process of arriving at my decision. Moreover, what I understood Mr. Wilson wanted these witnesses to testify to, were the discussions that they had with Mr. Sheppard that had made them reluctant to testify.

I do not believe I needed to hear about that. I accept that Sydney is a small community, where many of these people know each other and run in the same social or professional circles, and if these witnesses chose not to testify at the appointed time, then that was a decision that they would have to live with. Credibility [ 23 ] Even if I accepted Mr. Wilson's view of the matter, I am not sure the result would be all that different, although there might be more nuance to the question of compensation. But I cannot say that I found Mr. Wilson to be particularly convincing, and in the end I found Mr. Sheppard and Ms.

Sheppard to be more believable. If Mr. Wilson had indeed called Mr. Sheppard in early August, to deliver the news that he had sold the property, even though he did not speak directly to Ms. Sheppard, there is little doubt that Ms. Sheppard would have been aware of it. This is not something that Mr. Sheppard would have kept to himself without telling his wife. That is not a believable proposition. And I simply believe her when she said she was not aware until September. [ 24 ] Based on all of the evidence that I heard, I do not believe that Mr. Wilson was a terribly diligent communicator. I believe that

he only disclosed that he had sold his property around September 1. [ 25 ] I also do not find it credible that he, as a fairly sophisticated individual, would have believed that he could simply find another duplex and make arrangements for the Sheppards to live there, without them even having seen it. The responsible thing would have been to inform the Sheppards immediately, and either negotiate some kind of lease termination agreement, or at least use the procedures available under the Residential Tenancies Act to arrange for a termination of the lease. Mr.

Wilson said that he advised his real estate lawyer of the problem, but I sincerely doubt that he informed the lawyer that he had signed a one-year lease with tenants that was potentially going to interfere with the sale of his property. That is rather far-fetched. [ 26 ] I accept the evidence of the Sheppards that this created a very stressful situation for them. They had intended to move into the duplex on September 15, and would have had about a month to move and actually get out of their home before it was being sold.

In the end they had to scramble to find another place that would be available in mid-October, which place they found to be less than ideal in several respects. The fact that Mr. Sheppard filed this application on October 24 is some indication of the fact that he was clearly unhappy with how things had turned out in the immediate past. [ 27 ] I have no doubt that Mr. Wilson breached his obligations under the lease, and in the absence of any documentation that might have released him from his obligations under the lease, there is no basis upon which his defence can prevail.

If by a gentleman's agreement he means a verbal agreement, he should have known better than to attempt to get out of a signed lease without getting something in writing to that effect. Again, I do not believe he was so naive. [ 28 ] On the question of compensation, Mr. Sheppard produced evidence of additional storage costs and moving costs that he incurred. I believe that these expenses can be properly compensated within the general damages type of order that the Director made.

There is no magic to the idea of an equivalent to three months’ rent, as this is not any measure of how much notice ought to have been given. That is not how the procedures under the Act would have worked. However, The Residential Tenancy Officer believed that $6,000.00 was an appropriate amount, and I have no quarrel with that number. [ 29 ] Mr.

Wilson seems to have no appreciation that it was his willingness to sell his property for what must have been a considerable financial gain, that created all these problems, and $6,000.00 seems to me to be fair price to pay for all of the ripple effects of that decision on his part. [ 30 ] In the result, I find no fault with the order of the Director, and the appeal is dismissed. ORDER [ 31 ] This court orders that the Order of the Director of Residential Tenancies dated December 19, 2022, is confirmed in all respects. Eric K. Slone, Adjudicator