Subway Franchise Restaurants of Canada Ltd Date:, 2015 MBCA 101

Citation: Subway Franchise Restaurants of Canada Ltd Date: 20151019 v Sidhu, 2015 MBCA 101 Docket: AI15-30-08370 IN THE COURT OF APPEAL OF MANITOBA Coram: Mr. Justice Marc M. Monnin Madam Justice Diana M. Cameron Mr. Justice Christopher J. Mainella BETWEEN : ) W. R. Gardner and ) P. D. Edwards SUBWAY FRANCHISE RESTAURANTS ) for the Appellant OF CANADA LTD. ) ) J. M. Woolley and (Applicant) (Respondent) Respondent ) M. C.

Ross ) for the Respondent - and - ) ) Appeal heard and GURMAIL SIDHU ) Decision pronounced: ) October 7, 2015 (Respondent) (Appellant) Appellant ) ) Written reasons: ) October 19, 2015 MONNIN JA (for the Court): [ 1 ] At the hearing of this appeal, we announced it would be dismissed with brief reasons to follow. These are those reasons. [ 2 ] The appellant operated a Subway franchise pursuant to an agreement with the respondent since 2003 in a shopping centre in downtown Winnipeg.

As well as a franchise agreement, he entered into a sublease for the premises which required him to make the payments directly to the shopping centre operator. [ 3 ] In the spring of 2013, the appellant fell into arrears on the rent for the premises. In April 2014, the respondent applied for an order of possession for the premises due to failure to pay the rent pursuant to section 73(1) of The Landlord and Tenant Act , CCSM, c L70 (the Act ).

An order for vacant possession was granted on June 23, 2014, setting the amount of arrears at $18,152.03 and costs to be taxed on a solicitor and client basis. [ 4 ] On July 15, 2014, the appellant paid the rent in arrears to June 30, 2014, in the full amount of $18,152.03. Two days later the respondent moved ex parte for writ of possession of the premises based on the order of vacant possession previously granted.

The Master granted a writ of execution which was acted upon on July 24, 2014. [ 5 ] A new franchisee reopened the premises and continues to operate in that location. [ 6 ] The appellant appealed the Master’s order granting the writ to a judge of the Court of Queen’s Bench asking it be set aside and the appellant be returned to possession of the premises.

Two arguments were advanced on the appeal, namely, that the writ was improperly granted because eviction proceedings had been stayed automatically pursuant to section 73(5) of the Act , and secondly, that the appellant should be relieved from forfeiture pursuant to section 19(1) of the Act . The motion judge ruled that the stay under section 73(5) of the Act was not available to the appellant on the circumstances of the case and refused to grant relief from forfeiture based upon the view that the reasons provided by the appellant did not excuse the fact that the rent was in arrears for such a lengthy period.

[7] At the hearing of the appeal, those two issues were canvassed again by the appellant. We did not call upon therespondent to address whether the motion judge made a reversible error in refusing relief from forfeiture. [8] In our view, the question of whether the appellant was entitled to the benefit of the stay under section 73(5) of the Actis not determinative of the dispute between the parties. [9] The franchise agreement was terminated long before the respondent commenced the eviction proceedings.

Under histenancy, the appellant’s right to use the premises was limited only to operate a Subway sandwich shop pursuant to the franchiseagreement. He now wishes us to find that a stay should have been recognized and that he be granted possession. We do not believe weare in a position to do so given the factual background, the termination of the franchise agreement and the third party rights which havebeen created since the eviction. [10] In our view, the correctness of the motion judge’s

interpretation of section 73(5) of the Act would have no practicaleffect on the rights of the parties. We are also of the view that this is not an exceptional case to exercise our discretion and depart fromthe general rule to not hear a moot appeal (see Borowski v Canada (Attorney General), (SCC), [1989] 1 SCR 342 at353; Phillips v Nova Scotia (Commission of Inquiry into the Westray Mine Tragedy), (SCC), [1995] 2 SCR 97 at para12; and Maystar General Contractors Inc v International Union of Painters and Allied Trades, Local 1819 et al, 2008 ONCA 265 atparas 25-26, 235 OAC 227). [11] In dismissing the appeal we are not endorsing, or disagreeing with, the

interpretation of section 73(5) of the Act given bythe motion judge. Consideration of the motion judge’s

interpretation of section 73(5) of the Act is reserved to another day when adecision of this Court will settle a “live controversy” between litigants (Borowski at 353). Conclusion [12] The appeal is dismissed with costs. Costs are fixed at $500, plus a factum fee of $500, plus reasonable disbursements. JA JA JA