Executive Summary: Key Legal and Evidentiary Issues

• Central issue is whether an equitable assignment of the commercial lease occurred from Man II Management (Edmonton) Ltd. to Masuch Law LLP without formal documentation.

• The landlord (852819 Alberta Ltd.) consistently dealt with the law firm representatives, not Man II, demonstrating an implied landlord-tenant relationship with Masuch Law.

• Masuch Law paid rent via automatic deposit for nearly the entire lease term, occupied the premises, and paid utilities and security accounts for the full lease term.

• Upon merging with Ogilvie LLP, Masuch Law gave notice, promised to ensure rent payment, and requested assistance finding replacement tenants—actions consistent with tenant obligations.

• No particular form of words is required to create an equitable assignment; intent is gathered from the parties' words, actions, and surrounding circumstances.

• Standard of review on appeal from an Applications Judge is de novo with a correctness standard.

Background and lease history

In 2014, 852819 Alberta Ltd. (852), operating as Centre South, was approached by David Sheckter, a lawyer with Masuch Albert LLP, about leasing commercial space at 4528–99 Street in Edmonton. Jeff Dobrescu represented 852 in all lease negotiations. The parties initially agreed to a five-year lease with Masuch Albert LLP identified as the tenant in the May 1, 2014 Offer to Lease. However, when the formal lease was prepared, David Sheckter requested that the tenant name be changed to Man Management (Edmonton) Ltd. to limit the law firm's liability in case of financial difficulties. Sheckter assured Dobrescu that Masuch Albert LLP would always pay the rent as long as it remained in business. The landlord agreed to this arrangement.

The second lease and tenant name changes

In the Fall of 2018, David Sheckter approached Jeff Dobrescu to expand the leased space and enter into a new lease running from November 1, 2018 to October 31, 2023. At Sheckter's request, the tenant name was changed to Man II Management (Edmonton) Ltd., and the law firm's name had changed to Masuch Law LLP. Despite the formal tenant designation, Masuch Law occupied the premises and conducted its legal practice from the location. The first two months' rent were paid by Man Management (Edmonton) Ltd., and the third month's rent was paid by Man II. Thereafter, all rent was paid by Masuch Law by way of automatic deposit to the landlord. Masuch Law also paid the utilities and security accounts for the full lease term.

The merger and departure

In early January 2023, David Sheckter informed Jeff Dobrescu that Masuch Law had merged with Ogilvie LLP and would vacate the premises and move downtown to the offices of Ogilvie LLP. During this meeting, Sheckter assured the landlord that Masuch Law and Ogilvie LLP would ensure payment of outstanding rent, with ten months remaining on the lease. Sheckter also requested that the landlord assist Masuch Law in securing another tenant for the remaining months, thereby reducing Masuch Law's liability under the lease. The merger occurred as a result of Masuch Law's financial success, not because Masuch Law was in financial difficulty. Masuch Law paid rent for January and February 2023, though the February rent was not paid until March 7, 2023. Masuch Law then stopped paying the rent. The landlord secured a lease effective March 1, 2023 with a Masuch Law lawyer who was not moving to Ogilvie LLP for about one-third of the leased premises, reducing the outstanding monthly rent to $13,342.08. The total rent owing for the eight months remaining lease term from March 1, 2023 to October 31, 2023 is $106,736.64.

Evidence of tenant conduct

Multiple factors demonstrated that Masuch Law considered itself the true tenant under the second lease. The law firm continued to receive some mail at the leased premises, placed signage on the outside of the leased premises advising clients of its merger with Ogilvie LLP and how Masuch Law could be reached, and continued to have the key to the premises. Jeff Dobrescu had to arrange in May of 2023 to get access to the property to show the premises to a prospective tenant. Masuch Law paid utilities and security for the full term of the lease. The signage was removed after the lease expired on October 31, 2023. When the February 2023 rent was late, Jeff Dobrescu reached out to David Sheckter, who arranged for the law firm to pay the rent. Text messages between Jeff Dobrescu and David Sheckter showed Sheckter making inquiries about putting numbers together regarding rent and the options depending on how much space a proposed new tenant might take.

Legal principles applied

The court applied the established principle that no particular form of words is necessary to create an equitable assignment. The determination depends on the facts and the parties' intentions as gathered from what they said and did and from all the surrounding circumstances. To conclude that a lease was equitably assigned, there must be factors indicating that the landlord and the proposed assignee decided to treat each other as tenant and landlord, in addition to the elements of occupation and payment of rent.

Ruling and outcome

Justice D.A. Yungwirth, conducting a de novo hearing of the appeal from Applications Judge L.R. Birkett's March 20, 2025 decision, found that the relationship between Masuch Law and 852 under the December 2018 lease had all the indicia of landlord and tenant. The landlord believed Masuch Law was the tenant, and Masuch Law demonstrated by its actions throughout that it considered itself to be the tenant and that it was responsible for the rent to the end of the lease term. The court found that the landlord's consent to Masuch Law being the tenant was demonstrated by his actions, even without a formal assignment of lease. The appeal was dismissed, confirming that the conclusion by the Applications Judge was correct. The outstanding rent claimed for the remaining lease term from March 1, 2023 to October 31, 2023 totals $106,736.64, though the arbitration proceedings remain in abeyance pending this determination. Failing agreement between the parties on the issue of costs, costs may be spoken to within 45 days.No specific monetary award, costs, or damages were granted or ordered.