Executive Summary: Key Legal and Evidentiary Issues

• Lease renewal clause in Fatima & Dua Limited v. Munawar Sultana Hanif required written notice six months before expiry; no such notice was ever given despite tenant consulting counsel in January 2024

• An October 26, 2024 WhatsApp message about “instructing a lawyer to renew” was ambiguous and did not meet the contractual renewal requirements

• Landlord’s tolerance of rent underpayments and non-payment of TMI/HST did not waive the formal written-notice requirement

• Relief from forfeiture was unavailable because the lease ended by expiry, not by a landlord’s re-entry for breach

• Equitable renewal relief requires diligent compliance attempts and failure due to no fault of the tenant; the tenant’s own inaction defeated this

• Application dismissed with costs; timetable set for further costs submissions if parties could not agree

Facts
In Fatima & Dua Limited v. Munawar Sultana Hanif, the applicant corporation operated a Mississauga restaurant under a five-year commercial lease beginning December 13, 2019 and ending December 12, 2024. The lease included a renewal option requiring written notice to the landlord at least six months before expiry. No such written notice was sent by the June 2024 deadline. Instead, on October 26, 2024, the company’s principal sent a WhatsApp message stating he would instruct his lawyer to renew, but no formal notice followed. After the lease expired, the landlord locked the tenant out. The tenant briefly re-entered by changing the lock, but bailiffs resecured the premises on January 6, 2025. Due to factual disputes, the court ordered a summary trial on affidavit evidence with cross-examination.

Issue
The court was asked to restrain termination, declare the lease renewed for five years, and/or grant relief from forfeiture to cure the failure to exercise the renewal option.

Legal framework
The lease stipulated strict compliance with the renewal procedure—written notice within the six- to twelve-month period before expiry. The tenant sought statutory and equitable relief under s. 98 of the Courts of Justice Act and s. 20 of the Commercial Tenancies Act. The court cited Saskatchewan River Bungalows Ltd. v. Maritime Life Assurance Co. for the general equitable test (conduct, gravity of breach, proportionality) and Ontario Court of Appeal decisions (McRae Cold Storage Inc.; 2324702 Ontario Inc.) on the stricter renewal-option standard, which requires diligent compliance efforts and a failure not attributable to the tenant’s own fault.

Decision and reasoning
The tenant did not comply with the renewal clause—there was no written notice by June 2024 and no notice at all, even late or imperfect. The WhatsApp message did not constitute an exercise of the option; merely asking if the landlord would renew is not equivalent to exercising a binding right. While the landlord tolerated rent shortfalls and did not enforce TMI/HST payments until the term’s end, such tolerance could not replace the formal notice requirement. Relief from forfeiture was not available because the lockout followed expiry of the fixed term, not a forfeiture during the term. On the narrower equitable standard for renewal failures, the tenant could not show diligent compliance attempts or that the failure was due to circumstances beyond its control—especially as both the tenant’s principal and lawyer knew the lease terms in January 2024 and still failed to act.

Outcome
The Ontario Superior Court of Justice dismissed the application. No renewal was declared, equitable relief was refused, and the court ordered costs against the applicant, setting a timetable for written submissions if the parties could not agree.