Executive Summary: Key Legal and Evidentiary Issues

• The appellant defaulted on a mortgage over several rental properties, triggering foreclosure proceedings and an order for conduct of sale that he repeatedly obstructed by denying property access.

• Forced entry was authorized by the Supreme Court after evidence showed at least 12 occasions when a realtor showed up and was unable to obtain access following notice to the appellant.

• Notice to tenants became a contested issue, though the Court found tenants were given notice that the order for forced entry was being sought and did not appear at the hearing or seek to appeal or vary the order.

• Hearsay evidence in affidavits from realtors was challenged but ultimately deemed admissible under R. 22-2(13) as the source of the information was stated with names of the realtors and dates.

• Leave to appeal was denied because the appellant failed to identify any prima facie meritorious grounds of appeal.

• The application to vary was dismissed as the Court found no error in law, wrong principle, or misconception of the evidence in any way material to the decision to refuse leave to appeal.

Background and mortgage default

In November 2020, Asheley Aaron Stewart granted Ryan Mortgage Income Fund Inc. a mortgage over several rental properties that he owns in Prince George. Stewart defaulted on the mortgage and the respondent commenced foreclosure proceedings. An order nisi of foreclosure was made in October 2022, and following expiration of the redemption period, the lender was granted an order for sale with exclusive conduct of sale in August 2023. The order included a term compelling Stewart and any persons in possession of the properties to allow the respondent and its agents to inspect, appraise, or show the properties to prospective buyers on any day except statutory holidays. Tenants moved into one or more of the properties after the order for conduct of sale was made.

Obstruction of property access and forced entry order

According to the respondent, Stewart and his tenants often refused to allow access to the properties. Justice Chan found there were many unsuccessful attempts to show the properties from at least January 2024 to the present. There were 12 occasions when a realtor showed up and was unable to obtain access following notice to the appellant. The chambers judge found evidence of at least one potential sale falling through for this reason. Stewart, who has said that he wishes to be present at all showings, provided some evidence of times he facilitated access. However, he also said that he is only available to show the properties on two days out of the week. The chambers judge found that this was not sufficient to give effect to the conduct of sale order. In October 2024, the respondent applied for an order allowing forced entry into the properties. The hearing of that application was adjourned and eventually rescheduled for July 2025. Justice Chan granted the order on August 1, 2025, authorizing the lender to force entry to three of the properties between the hours of 9:00 a.m. and 9:00 p.m. for the purpose of enforcing its rights under the order for conduct of sale.

First appeal: application for leave to appeal

Stewart applied for leave to appeal the order allowing forced entry and also applied to have that order stayed pending the hearing of the appeal. Justice Edelmann heard this application and delivered reasons on October 16, 2025. Applying the established criteria for granting leave to appeal—whether the point on appeal is of significance to the practice, whether the point raised is of significance to the action itself, whether the appeal is prima facie meritorious or frivolous, and whether the appeal will unduly hinder the progress of the action—Justice Edelmann found that Stewart had not identified any prima facie meritorious grounds of appeal. Stewart raised three issues: clarifying the rules governing notice in foreclosure proceedings where tenants have commenced their tenancy after a foreclosure has been made, clarifying the rules of admissibility in relation to hearsay in chambers proceedings, and adding to the limited jurisprudence on the issue of forced entry in foreclosure proceedings. The court found that the tenants were given notice that the order for forced entry was being sought and did not appear at the hearing, and that none of the tenants have sought to appeal or vary the order. Justice Edelmann found there is little of significance in the appeal that would clarify the hearsay and forced entry issues, which are well established in the jurisprudence. Leave to appeal was denied, and as a result, the application for stay was moot.

Second appeal: application to vary

Stewart brought an application to vary Justice Edelmann's order before a division of the Court of Appeal pursuant to s. 29 of the Court of Appeal Act. This application was heard on January 6, 2026, before Chief Justice Marchand and Justices Gomery and Francis. A division will not interfere with the decision of a single Court of Appeal judge in chambers unless the Court is satisfied the chambers judge was wrong in law, or in principle, or misconceived the facts. Stewart submitted that Justice Edelmann erred in finding that the tenants were given notice of the application in the court below, in concluding that Justice Chan relied on hearsay evidence that was properly admissible, and in concluding that a decision on appeal will not add to the limited jurisprudence on the subject of forced entry. He also raised arguments concerning s. 94 of the Residential Tenancy Act regarding the rights of tenants.

Analysis of tenant notice and rights

The Court examined the notice issue in detail. In October 2024, the lender had served the tenants with notice of an application for forced entry, but that application was adjourned by Associate Judge Krentz to address a preliminary objection by the appellant that the notice of application was defective in that it did not properly state the legal basis of the application and the lender's affidavits were not properly sworn or affirmed. The lender prepared fresh affidavits for the application heard by Justice Chan in August 2025. It did not amend its notice of application or prepare a fresh notice of application. The Court found that the failure to amend the notice of application might have led Justice Chan to refuse the application, but it is clear from the two application responses filed by the appellant that he understood the legal basis for the order sought and was prepared to address the application on its merits. The Court addressed the scope of s. 94 of the Residential Tenancy Act, which states that no order of a court in a proceeding involving a foreclosure is enforceable against a tenant of the rental unit unless the tenant was a party to the proceeding. Relying on established jurisprudence including CIBC v. Garneau, the Court held that in a foreclosure context, s. 94 only applies to tenants until the order nisi is pronounced and does not protect tenants under tenancies that come into existence subsequently. The tenants obtain their rights of possession through the appellant, whose interest in the property has been under foreclosure since the order nisi was made. Stewart concedes that all the tenancies started after the order for conduct of sale had been made, including the condition allowing access to the properties.

Admissibility of hearsay evidence

Stewart challenged the admissibility of affidavits submitted by the lender, particularly two affidavits made by a realtor, Ms. O'Neill. The appellant acknowledges that hearsay is admissible on this kind of application pursuant to R. 22-2(13) on information and belief, if the source of the information is given. Ms. O'Neill recounts what she was told by other realtors about appointments made to view the properties where the appellant did not show up. The appellant's objection is that Ms. O'Neill's affidavits do not always state who provided the information or assert Ms. O'Neill's belief in the truth of the information provided to her. Justice Chan addressed the hearsay objection, noting this is not a final order and hearsay is admissible, and finding the reports made to Ms. O'Neill admissible as the source of the information is stated with the names of the realtors, and the dates the information was provided in the affidavit. The Court of Appeal found that, reading the affidavit as a whole, the affiant is asserting her belief in the statements she attributes to others and she identifies those others by name. The Court agreed with Justice Edelmann that Ms. O'Neill's affidavits, taken together with the other evidence to which Justice Chan referred, provided a proper evidentiary basis for the findings made by the judge.

Ruling and outcome

The Court of Appeal unanimously dismissed the application to vary Justice Edelmann's order. Justice Gomery, writing for the panel, concluded that Justice Edelmann did not err in law or act on a wrong principle, and did not misconceive the evidence in any way that is material to the decision to refuse leave to appeal. Any technical deficiencies with Ms. O'Neill's affidavits and the absence of a fresh notice of application do not undermine Justice Edelmann's conclusion that it is not in the interests of justice to grant leave to appeal. The Court noted that the Supreme Court is in a much better position to assess the ongoing enforcement and possible modification of its order should implementation be causing difficulties for the appellant or his tenants. Ryan Mortgage Income Fund Inc. was the successful party, with its forced entry order remaining in effect. No specific monetary award was granted in these proceedings, as they concerned the forced entry order rather than damages. The record indicated that the amount owing by the appellant had grown from approximately $528,000 when the order nisi was pronounced in 2022 to almost $700,000, and there may well be a shortfall when the properties are sold.