Date Issued: April 12, 2021

File: SC-2020-007883

Type: Small Claims

Civil Resolution Tribunal

Indexed as: Gong v. Canada Starlight Education Group Corporation, 2021 BCCRT 374

Between:

MINGXIU GONG

Applicant

And:

CANADA STARLIGHT EDUCATION GROUP CORPORATION

Respondent

INTRODUCTION

1.      This dispute is about unpaid rent. The respondent, Canada Starlight Education Group Corporation (Starlight), leased commercial premises from the applicant, Mingxiu Gong. Mrs. Gong says that Starlight failed to pay the $2,940 monthly rent for 3 months, plus related dishonoured cheque fees and interest fees under the lease agreement. Mrs. Gong claims $5,000, the maximum Civil Resolution Tribunal (CRT) small claims amount, and waives her claim to any amount over $5,000.

2.      Starlight admits it did not have sufficient funds in its bank account to pay rent in July, August, and September of 2020. Starlight says it could have paid rent if it had successfully applied for a government COVID-19 pandemic relief program, but Mrs. Gong failed to help with Starlight’s application. Starlight says Mrs. Gong instead attempted to profit from the relief program, in addition to trespassing and threatening an employee. Starlight says that as a result, it owes nothing.

3.      Mrs. Gong is self-represented in this dispute. Starlight is represented by an employee or principal.

JURISDICTION AND PROCEDURE

4.      These are the CRT’s formal written reasons, which has jurisdiction over small claims brought under section 118 of the Civil Resolution Tribunal Act (CRTA). Section 2 of the CRTA states that the CRT’s mandate is to provide dispute resolution services accessibly, quickly, economically, informally, and flexibly. In resolving disputes, the CRT must apply principles of law and fairness, and recognize any relationships between the dispute’s parties that will likely continue after the CRT process has ended.

5.      Section 39 of the CRTA says the CRT has discretion to decide the format of the hearing, including by writing, telephone, videoconferencing, email, or a combination of these. Although the parties’ submissions each call into question the credibility of the other party in some respects, I find I can properly assess and weigh the written evidence and submissions before me, and that an oral hearing is not necessary in the interests of justice. In the decision Yas v. Pope, 2018 BCSC 282, the court recognized that oral hearings are not always needed where credibility is in issue. Keeping in mind that the CRT’s mandate includes proportional and speedy dispute resolution, I find I can fairly hear this dispute through written submissions.

6.      Section 42 of the CRTA says the CRT may accept as evidence information that it considers relevant, necessary, and appropriate, whether or not the information would be admissible in a court of law. The CRT may also ask questions of the parties and witnesses and inform itself in any other way it considers appropriate.

7.      Where permitted by section 118 of the CRTA, in resolving this dispute the CRT may order a party to do or stop doing something, pay money or make an order that includes any terms or conditions the CRT considers appropriate.

ISSUES

8.      The issue in this dispute is whether Starlight is responsible for $5,000, for unpaid rent, contractual interest, and dishonoured cheque fees.

EVIDENCE AND ANALYSIS

9.      In a civil proceeding like this one, as the applicant Mrs. Gong must prove her claims on a balance of probabilities. I have read and weighed all the submitted evidence, but I refer only to the evidence I find relevant to provide context for my decision.

10.   The parties signed a September 20, 2016 lease agreement and an August 16, 2018 lease renewal. It is undisputed that the monthly rent under the renewal was $2,940 including tax, and that the last day of the renewed lease was September 30, 2020. The lease said that Starlight would pay a $5 per day late fee for any monthly rent not received by the 1^st day of the month, and a $50 fee for any cheques dishonoured by Starlight’s bank.

11.   The parties agree that Starlight did not pay any amount of rent for July 2020, August 2020, and September 2020, which is consistent with returned cheques in evidence. Starlight says that the COVID-19 pandemic hurt its business, so it was unable to pay. However, I find that Starlight’s alleged financial difficulties do not affect its obligations to pay rent under a commercial lease, subject to any obligations owed by Mrs. Gong as discussed below. Starlight moved out by September 30, 2020.

12.   It is undisputed, and I find, that Starlight failed to pay July, August, and September 2020 rent as required under the lease agreement and renewal. Starlight says it is Mrs. Gong’s fault that it could not pay rent, so it does not owe anything. I find that because Starlight makes this allegation, it bears the burden of proving it.

13.   Starlight says that it needed financial assistance from the Canada Emergency Commercial Rent Assistance (CECRA) program to be able to pay the disputed rent. Other than the parties’ own unsupported descriptions, there are no documents or other evidence before me describing CECRA or showing what information needed to be provided in a CECRA application. The parties’ descriptions of the application process differ, but on balance I find that it was Starlight’s responsibility to apply for CECRA assistance if it wanted to benefit from it. On balance, I also find that for Starlight to qualify for the program, Mrs. Gong likely needed to supply some application information, and possibly agree to fund part of the rent. Each party says the other failed to provide the information required for a successful application. On the evidence before me, I find neither party has proven what information was required or whether it was supplied by each party. As noted, Starlight bears the burden on this point.

14.   It is important to note that under the lease agreement, Starlight was required to pay rent and to ensure that its rent cheques were honoured by its bank. I find it failed to do so, which was a breach of the lease. I find the lease contains no written or implied requirement for Mrs. Goring to help Starlight apply for aid programs or to assist Starlight with any financial difficulties.

15.   Further, although Mrs. Gong might have offered to help Starlight with its CECRA application, and might or might not have done so, I find Starlight bears the burden of proving that Mrs. Gong had a duty to provide CECRA application information and failed in that duty. It appears that CECRA might have provided an opportunity for Mrs. Gong to continue receiving some amount of rent, but I find the evidence fails to show that Mrs. Gong was required to participate in the program. On balance, I find Starlight has not met its burden of proving that Mrs. Gong failed in a duty to provide required application information, or to otherwise participate in CECRA.

16.   Overall, I find that nothing before me shows that Mrs. Gong was required to help Starlight apply for the CECRA program, or that Starlight could escape responsibility for paying rent if it failed to apply for or qualify for the CECRA program.

17.   Starlight also says that Mrs. Gong improperly requested that Starlight pay her the 25% of the monthly rent that Mrs. Gong would have been responsible for under CECRA. I find that undisputed, certified translations of text messages between the parties show that Mrs. Gong’s notary, WT, likely suggested this course of action to Mrs. Gong. I find that Mrs. Gong explored the possibility of such payments with Starlight. However, I find that Starlight ultimately did not participate in the CECRA program, and Mrs. Gong did not subsidize any rent payments under CECRA or receive any related compensation from Starlight. So, I find nothing turns on the alleged rent subsidy refund requests.

18.   Starlight also says that Mrs. Gong and an associate, SZ, trespassed on the leased premises in July 2018 by not providing advance notice that she would be there. However, Starlight does not explain how an alleged trespass could allow it to avoid responsibility for the disputed rent payments, and it does not counterclaim for trespass damages. I note that the lease agreement says Mrs. Gong may enter the premises to view its state of repair and for other reasons, and Starlight does not directly deny that its premises are accessible by the public or that a Starlight employee allowed Mrs. Gong and SZ to enter. In the circumstances, I find any trespass would not have relieved Starlight of its responsibility to pay rent.

19.   Starlight says that Mrs. Gong threatened one of its employees on one occasion. A statement by BM, a Starlight employee, says that Mrs. Gong accused Starlight of lying and cheating the government, and that BM was insulted. However, I find the evidence fails to show that Mrs. Gong threatened anyone. Further, I find Starlight has not explained how any alleged threats could excuse Starlight from paying rent.

20.   I find that Starlight remained responsible for paying rent under the lease agreement and renewal in July, August, and September 2020. Together, these rent payments exceed the $5,000 maximum CRT small claim amount, but as noted Mrs. Gong has limited her claims to $5,000. Starlight does not allege that it made any partial payments, or that Mrs. Gong withheld any deposits or other amounts owed to Starlight. So, I find Starlight owes Mrs. Gong $5,000 for unpaid rent.

21.   As noted, the lease agreement also provided for late rent fees and dishonoured cheque fees. Since Mrs. Gong is already awarded the $5,000 maximum CRT amount for unpaid rent and has abandoned any excess, I find it is unnecessary to consider whether she is also entitled to those additional rent-related fees.

CRT FEES, EXPENSES, AND INTEREST

22.   The parties do not dispute, and I find, that the lease agreement’s $5 per day late rent payment fee is an agreement about interest. The Court Order Interest Act applies to the CRT, and section 2(b) says that court order interest must not be awarded if there is an agreement about interest between the parties. So, I find that no pre-judgment interest is payable here.

23.   Under section 49 of the CRTA and CRT rules, the CRT will generally order an unsuccessful party to reimburse a successful party for CRT fees and reasonable dispute-related expenses. Mrs. Gong was successful in her claims, so I find she is entitled to reimbursement of the $175 she paid in CRT fees. Mrs. Gong claimed no dispute-related expenses.

ORDERS

24.   Within 30 days of the date of this order, I order Starlight to pay Mrs. Gong a total of $5,175, broken down as follows:

a.    $5,000 in debt for unpaid commercial rent, contractual interest, and dishonoured cheque fees, and

b.    $175 in CRT fees.

25.   Mrs. Gong is entitled to post-judgment interest, as applicable.

26.   Under section 48 of the CRTA, the CRT will not provide the parties with the Order giving final effect to this decision until the time for making a notice of objection under section 56.1(2) has expired and no notice of objection has been made. The time for filing a notice of objection is 28 days after the party receives notice of the CRT’s final decision. The Province of British Columbia has enacted a provision under the COVID-19 Related Measures Act which says that statutory decision makers, like the CRT, may waive, extend, or suspend mandatory time periods. This provision is expected to be in effect until 90 days after the state of emergency declared on March 18, 2020 ends, but the Province may shorten or extend the 90-day timeline at any time. A party should contact the CRT as soon as possible if they want to ask the CRT to consider waiving, suspending, or extending the mandatory time to file a Notice of Objection to a small claims dispute.

27.   Under section 58.1 of the CRTA, a validated copy of the CRT’s order can be enforced through the Provincial Court of British Columbia. A CRT order can only be enforced if it is an approved consent resolution order, or, if no objection has been made and the time for filing a notice of objection has passed. Once filed, a CRT order has the same force and effect as an order of the Provincial Court of British Columbia.