Executive Summary: Key Legal and Evidentiary Issues

• Dispute over whether any enforceable lease existed for the barn, including whether occupation amounted to acceptance of a $2,000 monthly rent.
• Classification of the Respondents’ continued use of the barn as trespass once no binding lease was found.
• Assessment of occupation rent as damages despite the absence of market evidence for comparable barn rentals.
• Reliance on the Applicant’s March 3, 2025 affidavit and correspondence as the sole evidentiary record.
• Consequences of the Respondents’ failure to file materials or attend the December 4, 2025 hearing.
• Two costs awards in favour of the Applicant at different stages of the Application, in addition to damages for trespass.

Facts of the case

The dispute concerns a property on Highway 48 in Beaverton, Ontario, owned by the Applicant, Peter Rugiano. The property contains a residence and a barn. By a lease dated April 1, 2023, the Respondents, Christine Gibson and Aaron Goard, rented the residence from the Applicant. They also inquired about renting the barn. The Applicant told them they could rent it for $2,000 per month with three months’ free rent, but no agreement was reached for the barn. Despite the absence of a formal lease, the Respondents began occupying the barn.

In June 2023, the Applicant observed their use of the barn and, on June 22, 2023, delivered a notice stating they were to begin paying $2,000 per month effective July 1, 2023. On August 28, 2023, the Respondents replied that they “never fathomed” the rent would be $2,000 and believed most barns rented for $300 to $500 per month. A further notice dated October 2, 2023 set out rent due at $2,000 per month, and on October 3, 2023 the Respondents reiterated that they had not agreed to pay that amount. On October 10, 2023, the Applicant directed them to remove their equipment and livestock from the barn, but they did not comply.

The Respondents also fell into arrears on rent for the residence, leading to two proceedings at the Landlord and Tenant Tribunal. They continued occupying the barn without paying rent for it. The Applicant attempted to retain a bailiff to evict them from the barn and was told a court order was necessary. On September 25, 2024, he commenced this Application, seeking an order that the Respondents vacate the barn, an order for possession, and damages of $70,000 to September 1, 2024, plus $2,000 per month and hydro reimbursement for continued occupation thereafter.

At the first hearing on March 20, 2025, the Applicant sought possession of the barn, payment for the Respondents’ occupation, and clean-up costs. The court ordered the Respondents to vacate the barn within 30 days and adjourned the remaining issues because there was no legal authority or market evidence supporting the claimed $2,000 rent, and no proof of clean-up expenses. The court directed the filing of statements of law and urged documentation of the barn’s condition after vacating. Costs to that point were fixed at $5,000, payable by the Respondents.

The matter returned on December 4, 2025. The hearing date was set through the trial co-ordinator at the Applicant’s request. The Respondents did not file materials or attend. Although it was unclear on the record whether a formal Notice of Return of Application had been served, the Applicant’s counsel advised that confirmation of the return date had been emailed to the Respondents on November 20, 2025. No new evidence was filed. Counsel indicated that the only remaining issue was damages for the unpaid occupation of the barn from July 2023 to May 2025. The evidentiary record therefore consisted only of the Applicant’s affidavit sworn March 3, 2025 and the correspondence described therein, including the Respondents’ written rejection of the $2,000 rent and their position that barns typically rented for much less. Counsel also advised that the Respondents did vacate the barn following the March 20, 2025 order, but there was no evidence of the exact vacate date.

Issues before the court

The court identified three issues: whether the parties entered into an enforceable lease for the barn, whether the Respondents were trespassers in relation to the barn, and what damages, if any, were owed to the Applicant for the unpaid occupation.

Analysis of the lease issue and contract formation

On the lease question, the court found there was no written agreement for the barn. The Applicant’s position was that he had offered to rent the barn for $2,000 monthly and that the Respondents, by occupying the barn, accepted this offer by conduct. The court applied the objective theory of contract formation from Owners, Strata Plan LMS 3905 v. Crystal Square Parking Corp., 2020 SCC 29, which asks whether a reasonable person in the parties’ respective positions would consider that one party’s conduct constituted an offer and the other’s conduct an acceptance.

The court held that the evidence did not support a finding of acceptance. The Respondents never paid $2,000 per month for the barn and paid nothing for it at all. Their written responses expressly rejected $2,000 as the rent and indicated they believed barns generally rented for $300 to $500 per month. On this record, the judge concluded that the Applicant had not met the objective test for a binding lease at $2,000 per month.

Trespass finding

Turning to trespass, the court relied on Rossiter v. Swartz, 2013 ONSC 159, which defines trespass as occurring when a person without lawful justification enters upon, remains upon, or places or projects any object upon land where another has a legal right of occupation or possession. The judge found there was no doubt that the Respondents were trespassers in their occupation and use of the barn. Without a binding agreement to lease the barn, they had no right to occupy it and therefore committed the tort of trespass.

Damages and occupation rent

The court then addressed damages. Trespass is actionable per se, meaning that proof of actual loss is not required. However, the Applicant advanced no evidence of any clean-up or repair costs for the barn, so the court confined damages to compensation for deprivation of the use of the property, described as occupation rent.

Citing Dagarsho Holdings Ltd. v. Bluestone, 2004 CanLII 11271 (ONSC), the judge described occupation rent as an equitable remedy grounded in the principle that, where someone occupies land without a lease, the law may imply a contract for a reasonable amount for use and occupation. Ordinarily, the court would look to market rent for similar property to determine what is reasonable, but there was no market evidence about comparable barns. The only figures before the court were the Applicant’s $2,000 claim and the Respondents’ indication that $300 to $500 per month was more realistic.

The judge inferred that the Applicant’s $2,000 did not reflect market value, particularly since he had been asked earlier to provide market evidence and failed to do so. The figure appeared to be one selected at a time when the Respondents were in a difficult bargaining position, needing space for equipment and livestock. The Respondents, for their part, appeared financially strained and paid nothing for the barn over an extended period. The judge concluded that a reasonable value likely lay between the two positions. In written submissions, the Applicant had proposed $1,250 per month, effectively splitting the difference between $2,000 and $500, and the court adopted this figure as a reasonable occupation rent in the absence of other evidence.

As to the length of the trespass, there was no direct evidence of when the barn was vacated, but the March 20, 2025 order required vacating within 30 days. The judge assumed compliance, meaning the Respondents would have left before the end of April 2025. On that basis, the period of occupation for which the Applicant sought compensation was 22 months, from July 2023 through April 2025. At $1,250 per month, the Respondents owed $27,500, and the court ordered them to pay that amount as damages for their trespass to the Applicant’s barn.

Procedural history and overall outcome

Procedurally, the Application involved two key court appearances. At the March 20, 2025 hearing, the court ordered the Respondents to vacate the barn within 30 days and adjourned the balance of the Application to permit further legal and evidentiary materials. The court also fixed costs of the Application to that point at $5,000, to be paid by the Respondents. At the December 4, 2025 return, the Respondents did not participate, and the court proceeded on the basis of the Applicant’s existing affidavit and the parties’ prior written communications.

In the December 8, 2025 endorsement, the court determined that there was no binding lease for the barn at $2,000 per month, that the Respondents were trespassers, and that the Applicant was entitled to occupation rent as damages. The court ordered the Respondents to pay $27,500 in damages, calculated at $1,250 per month for 22 months, and fixed further costs at $3,500, all-inclusive. Combined with the earlier $5,000 costs award from March 20, 2025, the total amount ordered in favour of the successful party, the Applicant, across both decisions referenced in the text is $36,000, representing $27,500 in damages and $8,500 in costs.