Blanco v. Rental Commission, [1980] 2 SCR 827

Supreme Court of Canada

Blanco v. Rental Commission, [1980] 2 S.C.R. 827

Date: 1980-10-07

Claribell Blanco (Respondent in Court of Appeal, applicant in Superior Court) Appellant;

and

Rental Commission (Mis en cause in Court of Appeal and Superior Court) Respondent;

and

Paxmill Corporation (Appellant in Court of Appeal and respondent in Superior Court) Mis en cause.

1980: May 7; 1980: October 7.

Present: Beetz, Estey, McIntyre, Chouinard and Lamer JJ.

ON APPEAL FROM THE COURT OF APPEAL FOR QUEBEC

Administrative law—Rental Commission—Eviction for habitual late payment of rent—Excess of jurisdiction—Writ of evocation—Act to Promote Conciliation between Lessees and Property-Owners, 1950-51 (Qué.), c. 20 as amended, ss. 17, 25(a) and (b)—Code of Civil Procedure, art. 846.

The mis en cause, Paxmill Corporation, applied to the administrator of the Rental Commission for eviction of its tenant, appellant Blanco. Its application was based on paras. (a) and (b) of s. 25 of the Act to Promote Conciliation between Lessees and Property‑Owners (the “Conciliation Act”). As appellant had paid all the rent she owed before the application was heard before the administrator, the argument based on para. (a), namely non-payment of rent, was conceded. However, the administrator considered the habitual late payment of rent (twelve N.S.F. cheques in a twenty-four-month period) to be “behaviour on the leased premises” which, under para. (b), justified eviction of the tenant. The decision of the Rental Commission, upholding that of the administrator, was homologated by the Provincial Court. Appellant then obtained leave from the Superior Court for a writ of evocation to be issued against this decision. The Court of Appeal reversed this judgment, holding that there had been no excess of jurisdiction by the Commission. Hence the appeal to this Court.

Held: The appeal should be allowed.

The principles applicable to the supervisory power of the Superior Court in relation to a privative clause, such as s. 17 of the Conciliation Act, are well established and have been approved by the courts. Though the adminis-

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trator and the Rental Commission may err in the exercise of their jurisdiction, they may not, by a mistaken interpretation of the law, appropriate jurisdiction which they do not have or decline that which they do have. In the case at bar, by misinterpreting s. 25, they assumed a jurisdiction which is denied to them by law. Paragraph (b) of s. 25 is the provision of the Conciliation Act relating to the payment of rent. If a tenant has paid his rent before the hearing, the administrator has no discretion: he cannot cancel the lease. The purpose of the legislator must of necessity have been different in para. (b), in which he conferred on the administrator a power of appreciation, that is, the right to decide whether the tenant’s behaviour on the leased premises constituted a serious source of annoyance to the owner. Delay in the payment of rent cannot legally be equivalent to such behaviour. By means of this incorrect interpretation, the administrator and the Commission assumed a power to cancel the lease on a ground of eviction which is not contained in the Act, and which they created out of thin air: that of repeated, frequent or systematic delays in the payment of rent.

Jarvis v. Associated Medical Services Inc., [1964] S.C.R. 497; Commission des Relations de Travail du Québec v. L’Association unie des compagnons et apprentis de l’industrie de la plomberie et tuyauterie des États-Unis et du Canada, [1969] S.C.R. 466; Commission de contrôle des permis d’alcool du Québec v. Distribution Kinéma Ltée, [1977] C.A. 308, referred to.

APPEAL from a judgment of the Court of Appeal of Quebec[1], setting aside a judgment of the Superior Court authorizing issuance of a writ of evocation. Appeal allowed.

Zyskind Finkelstein and Dida, Berku, for the appellant.

Robert Monette and Paule Lafontaine, for the respondent.

English version of the judgment of the Court delivered by

BEETZ J.—The Court must decide whether the Rental Commission erred in law and exceeded its jurisdiction by interpreting as indicated below paras. (a) and (b) of s. 25 of the Act to Promote Conciliation between Lessees and Property-Owners, 1950-51 (Que.), c. 20 as amended (the “Conciliation Act”):

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25. The administrator must cancel the lease and allow the eviction of the lessee if one of the following facts is proved to him:

(a) that the lessee is more than three weeks in arrears in the payment of his rent and the said rent has not been paid prior to hearing before the administrator;

(b) that the lessee, a member of his family or any other person under his control or living with him behaves on the leased premises in such a way as to constitute, in the opinion of the administrator, a serious source of annoyance to the owner or to the neighbors;

…

The facts are not in dispute. They are set forth in appellant’s factum, which is admitted by respondent on this point.

Appellant was, at all times relevant hereto, a single mother living on welfare and lessee occupying the residential premises bearing civic number 3718 Park Ave., in the city and district of Montreal, Province of Quebec, in virtue of a written lease which commenced on the 1st of June, 1974 and terminated the 30th June, 1976, which lease was renewed by the rental administrator until June 30th, 1977 at the monthly rental of $205.00.

Mis-en-cause Lessor was at all times relevant hereto owner of the said leased premises. Mis-en-cause applied to the administrator of the Rental Commission requesting cancellation of the lease and the eviction of Appellant, based on paragraphs (a) and (b) of section 25 of the Act to Promote Conciliation between Lessees and Property Owners, S.Q. 1950-51 c. 20 as amended, hereinafter referred to as the Act to Promote Conciliation.

At the hearing, it was established that Appellant had paid all the rent due, prior to the hearing before the administrator and consequently the grounds for eviction under paragraph (a) of section 25 were no longer applicable and were therefore abandoned by the lessor.

The administrator then proceeded to allow proof regarding the lessee’s pattern of rental payment. The only proof made consisted of the production of a series of twelve (12) N.S.F. cheques given to the lessor by the tenant over a period of 24 months.

The administrator was of the opinion that the lessee’s habitual late payment of rent constituted a serious source of prejudice to the lessor, in virtue of section 25 (b) of the Act to Promote Conciliation. Thus, the administrator revoked the prolongation of the lease and permitted the lessor to evict the lessee…

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Appellant appealed the said decision to the Rental Commission which, by judgment dated April 13, 1977, rejected said appeal and maintained the decision of the administrator on the grounds that “in the eyes of the Commission”, the lessee’s constant late payment of rent constituted a sufficient ground for eviction… The judgment of the Rental Commission was homologated by the Provincial Court and Petitioner immediately presented a motion to the Superior Court in virtue of Article 846 C.P.C. requesting the issuance of a writ of evocation against the judgment of the Rental Commission on the basis of excess of jurisdiction. Mr. Justice J.P. Bergeron, J.C.S., authorized the issuance of the writ introductive of suit on May 17, 1977…

The Court of Appeal, composed of Kaufman, Bélanger and Dubé JJ.A., by judgment dated January 10, 1978, …reversed the judgment of the Superior Court.

Thus the appeal before this Honourable Court for which leave was granted on the 1st of May 1978.

The judgment of the Superior Court, handed down forthwith, was given without reasons.

The decision of the Court of Appeal, per Bélanger J.A., concurred in by Kaufman and Dubé JJ.A., was that the review sought by appellant constituted a disguised appeal and that, even if the administrator and the Rental Commission interpreted the Conciliation Act incorrectly, an issue which did not have to be resolved, they did not exceed their jurisdiction. In further reasons, Kaufman J. seriously questioned the proposition that appellant’s behaviour amounted to behaviour “on the leased premises”, but he found that this error, if it was one, did not deprive the administrator and the Commission of jurisdiction.

The principles applicable to the matter are also not in dispute: they are well established. It is their application to specific cases which sometimes gives rise to difficulty.

Section 17 of the Conciliation Act contains a privative clause which places the administrator and the Rental Commission outside the supervisory power of the Superior Court. They may therefore err in the exercise of their jurisdiction but they may not, by a mistaken interpretation of the

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law, appropriate jurisdiction which they do not have or decline that which they do have.

These principles have been approved by the courts on numerous occasions. They have been acted upon by this Court, as for example in Jarvis v. Associated Medical Services Inc.[2] and in Commission des Relations de Travail du Québec v. L’Association unie des compagnons et apprentis de l’industrie de la plomberie et tuyauterie des États-Unis et du Canada[3]. They were also followed by the Court of Appeal in Commission de contrôle des permis d’alcool du Québec v. Distribution Kinéma Ltée[4].

In my opinion, and I say so with respect for the opposite view, the administrator and the Rental Commission erred in their interpretation of s. 25 of the Conciliation Act and, as a result of their error, assumed a jurisdiction which is denied to them by law.

Paragraph (a) of s. 25 is the only provision of the Conciliation Act relating to the payment of rent.

When the condition specified in this provision is fulfilled, that is, when the tenant is more than three weeks in arrears in the payment of his rent, the administrator has a duty to cancel the lease. He has no discretion. There is equally no discretion when the rent is paid before the hearing: in that case, he loses his power to cancel the lease. The enactment corresponds in this regard to the ordinary law, as expressed in art. 1633 of the Civil Code:

In an action for cancellation for failure to pay rent, the lessee may avoid the cancellation by paying, before judgment, the rent due with interest and costs.

I think that by s. 25(a) of the Conciliation Act, the legislator intended to exhaust the question of payment of rent and delay in payment. His purpose must have of necessity been different in para. (b), in which he conferred on the administrator under certain circumstances a power of appreciation, that is, the right to decide whether the ten-

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ant’s behaviour on the leased premises constituted a serious source of annoyance to the owner. Delay in the payment of rent cannot legally be equivalent to such behaviour. Otherwise, the tenant would be deprived of the remedy provided in para. (a), that of paying before the hearing is held, and the administrator would acquire a kind of discretion in an area where the legislator did not intend he should have any.

The only evidence contained in the record relates to the tenant’s delay in paying her rent. In my view, it is incorrect to characterize this delay as behaviour on the leased premises which can constitute a serious source of annoyance to the owner.

By means of this incorrect characterization, first the administrator and then the Rental Commission assumed a jurisdiction which they do not possess: not only, as I have just said, did they extend their discretion to an area where they had none, but they appropriated a power to cancel a lease on a ground of eviction which is not contained in the Act and which they created out of thin air: that of repeated, frequent or systematic delays in the payment of rent.

This is a sufficient basis for the writ of evocation to issue.

However, even if repeated delays in the payment of rent were capable of amounting to behaviour on the leased premises likely to constitute a serious source of annoyance to the owner, within the meaning of s. 25(b), it would still have to be proven that this behaviour occurred on the leased premises.

There is no evidence to this effect.

In the Court of Appeal, Paxmill Corporation, the owner of the leased premises, was one of the appellants. The appellant asked the Court of Appeal for leave to amend her pleadings to substitute the Rental Commission for Paxmill Corporation as respondent-appellant, Paxmill Corporation becoming the mis en cause. She also asked the Court of Appeal for leave to make certain other amendments which would seem to me of a minor nature.

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The Court of Appeal made no ruling on this motion to amend, as it concluded that in any case the result would have been the same.

In this Court, appellant reiterated her motion.

The Rental Commission submitted no argument on the matter because the Court of Appeal had not ruled on it.

Although the inscription in appeal to this Court was served on it, Paxmill Corporation was not represented here and the Court was told that it had no interest in the case.

I see no reason to deny appellant’s motion.

I would give appellant leave to amend as requested. I would allow the appeal, set aside the judgment of the Court of Appeal and restore the judgment of the Superior Court, with costs in all courts. However, there will be no costs to or against Paxmill Corporation in this Court.

Appeal allowed with costs.

Solicitors for the appellant: Finkeslstein, Fournelle, Berku & Paquin, Montreal.

Solicitors for the respondent: Bilodeau, Flynn & Roy, Montreal.