John De Vellis

The plaintiff condominium corporation brought a motion in writing for default judgment for possession and foreclosure against the defendant unit owner for unpaid common expenses.

The defendant was noted in default.

The court granted the motion, ordering possession and foreclosure of the equity of redemption in favour of the condominium corporation, with a condition to pay the second defendant's mortgage upon sale.

The applicant condominium corporation sought full indemnity costs against a unit owner and her tenant following a successful compliance order for noise violations.

The court awarded reduced costs of $23,250 against the tenant, finding her solely responsible for the noise and refusal to settle.

No costs were awarded against the owner due to the corporation's poor communication and the owner's reasonable efforts to address the issue and willingness to consent to the compliance order. interesting_citations_summary: > This decision clarifies the application of full indemnity costs under s. 134(5) of the Condominium Act, 1998, emphasizing that while a successful condominium corporation is generally entitled to full recovery, the court retains discretion to reduce costs based on the corporation's conduct and the principles of fairness and access to justice.

It also highlights the importance of proper communication by condominium corporations with unit owners regarding tenant infractions, citing Carleton Condominium Corporation No. 555 v. Legace for the principle that owners must be notified to take "reasonable steps" under s. 119(2).

The court extends the liability for "additional actual costs" under s. 134(5) to tenants where equitable, interpreting s. 134(3)(c). final_judgement: > The court fixed the applicant's costs at $23,250 and ordered the respondent Saskia Kalicharan (the Tenant) to pay that sum within 90 days.

Ms. Kalicharan’s claim for costs was dismissed.

No costs were awarded against the respondent Lillian Doreen Lyn (the Owner). winning_degree_applicant: 2 winning_degree_respondent: 3 judge_bias_applicant: 0 judge_bias_respondent: 0 year: 2020 decision_number: 3853 file_number: "CV-19-614659" source: "https://www.canlii.org/en/on/onsc/doc/2020/2020onsc3853/2020onsc3853.html" cited_cases: legislation: - title: "Condominium Act, 1998, S.O. 1998, c. 19" url: "https://www.ontario.ca/laws/statute/98c19" - title: "Courts of Justice Act, R.S.O. 1990, c.

C.43" url: "https://www.ontario.ca/laws/statute/90c43" case_law: - title: "Metropolitan Toronto Condominium Corp. No. 933 v. Lyn, 2020 ONSC 196" url: "https://www.canlii.org/en/on/onsc/doc/2020/2020onsc196/2020onsc196.html" - title: "Metropolitan Toronto Condominium Corp. No. 1385 v. Skyline Executive Properties Inc., 2005 ONCA 409" url: "https://www.canlii.org/en/on/onca/doc/2005/2005onca409/2005onca409.html" - title: "Chan v. TSCC No. 1834, 2011 ONSC 108" url: "https://www.canlii.org/en/on/onsc/doc/2011/2011onsc108/2011onsc108.html" - title: "Toronto Standard Condominium Corporation No. 2032 v. Boudair, et al., 2016 ONSC 509" url: "https://www.canlii.org/en/on/onsc/doc/2016/2016onsc509/2016onsc509.html" - title: "Carleton Condominium Corporation No. 555 v. Legace" url: "https://www.canlii.org/en/on/onsc/doc/2004/2004canlii26137/2004canlii26137.html" - title: "Boucher v. Public Accountants Council (Ontario)" url: "https://www.canlii.org/en/on/onca/doc/2004/2004canlii14579/2004canlii14579.html" keywords: - Costs - Condominium Act - Noise Bylaw - Compliance Order - Full Indemnity Costs - Partial Indemnity Costs - Unit Owner Liability - Tenant Liability - Condominium Corporation Communication - Access to Justice areas_of_law: - Civil Procedure - Condominium Law --- 2020 ONSC 3853 # Court File and Parties **Court File No.:** CV-19-614659 **Date:** 20200622 **Superior Court of Justice – Ontario** **Application Under** sections 119(3), and 134(1) of the Condominium Act, 1998 **Re:** METROPOLITAN TORONTO CONDOMINIUM CORPORATION NO. 933, Applicant **And:** LILLIAN DOREEN LYN and SASKIA ANYARA KALICHARAN, Respondent **Before:** Stinson J. **Counsel:** John De Vellis and Luis A. Hernandez, for the Applicant Marshall Reinhart, for the Respondent Lillian Doreen Lyn Saskia Anyara Kalicharan, Respondent, in person **Heard:** by written submissions --- # Reasons for Decision on Costs [1] In my Reasons for Decision released on January 13, 2020 ([2020 ONSC 196](/on/scj/2020/196)), I found as a fact that the respondent Saskia Kalicharan (the “Tenant”) had repeatedly violated the Noise Bylaw of MTCC 933 (“933”).

I therefore made a declaration that, by creating excessive noise, the Tenant breached 933’s Rule 1(d).

I also made an order requiring the Tenant to comply with the [Condominium Act, 1998, S.O. 1998, c. 19](https://www.ontario.ca/laws/statute/98c19) (the “Act”) and the Rules of 933. [2] In relation to the costs of the proceedings in the Superior Court of Justice, at the time of the hearing the parties agreed that submissions on this topic should await my decision on the main points of the application, and could be made in writing, if required.

In my decision released on January 13, 2020, I encouraged the parties to agree on the issue of costs, but they were unable to do so.

They have now filed written submissions, leading to these Reasons. ## The authority of the court to order a litigant to pay costs [3] The [Courts of Justice Act, R.S.O. 1990, c.

C.43](https://www.ontario.ca/laws/statute/90c43), s.131(1) states as follows: > Subject to the provisions of an Act or rules of court, the costs of and incidental to a proceeding or a step in a proceeding are in the discretion of the court, and the court may determine by whom and to what extent the costs shall be paid. [4] This provision gives the judge who decides a case the power to order one litigant in a court proceeding to pay legal costs to another litigant in the proceeding.

Ordinarily, a successful litigant seeks and is granted an order for costs against an unsuccessful litigant, unless there is good reason to depart from that principle.

Thus in the present case, as the applicant who succeeded in obtaining the compliance order that it sought, 933 has asked for an award of costs against the two responding parties, Lillian Lyn – the Owner of the unit – and the Tenant. [5] In an ordinary (non-Condominium Act) case, an award of costs is made on so-called “partial indemnity” basis, that is, the successful litigant is awarded an amount that serves to indemnify them partially for their own legal bill from their lawyer.

In rare and exceptional cases where an unsuccessful litigant has been guilty of egregious behaviour such as fraud, a costs award may be made on a “substantial indemnity” or even a “full indemnity” basis, so that the winning litigant is awarded substantially all of their own lawyer’s legal bill or even their full legal bill. [6] However, in a compliance proceeding commenced under s.134 of the Condominium Act such as this one, there is an additional power given to the court in relation to legal costs incurred by a condominium corporation.

That power is found in s.134(3) and (5) of the Act, which state as follows: > (3) On an application, the court may ... > (a) grant the order applied for; > (b) require the persons named in the order to pay, > (i) the damages incurred by the applicant as a result of the acts of non-compliance, and > (ii) the costs incurred by the applicant in obtaining the order; or > (c) grant such other relief as is fair and equitable in the circumstances. > > (5) If a corporation obtains an award of damages or costs in an order made against an owner or occupier of a unit, the damages or costs, together with any additional actual costs to the corporation in obtaining the order, shall be added to the common expenses for the unit and the corporation may specify a time for payment by the owner of the unit. [7] The court’s authority to order costs to be paid by unsuccessful parties in condominium compliance proceedings has been considered in numerous decided cases.

A leading decision is [Metropolitan Toronto Condominium Corp. No. 1385 v. Skyline Executive Properties Inc., 2005 ONCA 409](https://www.canlii.org/en/on/onca/doc/2005/2005onca409/2005onca409.html) (“Skyline”).

In that case, the Court of Appeal stated as follows: > … s. 134(5) speaks separately to "an award of costs" on the one hand, and "additional actual costs" on the other hand. "An award of costs" refers to the costs that the court orders one litigant to pay to another litigant. "Additional actual costs" can encompass those legal costs owing as between the client and its own lawyer beyond the costs that the court had ordered paid by an opposing party.

To the extent that the legal bills owed by [the condominium corporation] to its own lawyers exceeded the costs awarded against [the unit owner], [the condominium corporation] could properly add those amounts to the common expenses of the [the unit owner’s] units as long as [the condominium corporation] could demonstrate that those additional legal costs were incurred in obtaining the compliance order. [8] In effect, in condominium compliance cases such as the present one, through the application of s.134(5), the courts have awarded the equivalent of full indemnity costs to a successful condominium corporation. [9] For example, in [Chan v. TSCC No. 1834, 2011 ONSC 108](https://www.canlii.org/en/on/onsc/doc/2011/2011onsc108/2011onsc108.html) (“Chan”) the court found that the unit owner had breached the condominium declaration provisions limiting the use of the units to "single family" occupancy by allowing unrelated tenants to live in one unit, similar in nature to a rooming or boarding house.

The court referred with approval to past cases that found that it would not be "fair or equitable for other unit owners to subsidize the costs of such unwarranted conduct making an award of solicitor/client [now substantial/full indemnity] costs appropriate." The condominium corporation had given repeated warnings of the cost consequences of enforcement and those warnings were ignored, leading the court to conclude that "the costs are the consequence of the unit owner's own actions.

In these circumstances, the other blameless unit owners should not be made to bear any part of those costs and it is therefore appropriate that the non-compliant unit owner pay the costs on a full recovery basis." ## Positions of the parties ### 933 [10] As provided in s. 134(5) and consistent with the above decisions, 933 seeks an award of the costs of the proceeding as well as its additional actual costs of obtaining the compliance order.

It seeks those costs as against both the Owner as well as the Tenant.

It asks for an award in the total sum of $33,469.73. [11] 933 submits that it was entirely successful in the application, in that the court found that it was entitled to the declaration and mandatory order that it sought requiring the Tenant to comply with the Act and 933’s Rules.

It submits that the litigation was unnecessary: the noise complaints commenced in June 2017 and the notice of application was not issued until February 2019, 19 months later.

In the interim, both the Tenant and the Owner were warned numerous times about the noise. 933 says it acted reasonably and prior to the first court appearance attempted to have both the Owner and the Tenant consent to the compliance order.

The Owner was prepared to, but the Tenant was not.

After the first court appearance, 933 contacted the Tenant to attempt to reach a resolution and offered to resolve the matter by way of a consent order without costs.

The Tenant still refused to consent and as a result, the matter came back on for hearing on December 3, 2019, ultimately resulting in my decision dated January 13, 2020. ### The Owner [12] The Owner submits that no order as to costs should be made against her.

She submits that she acted reasonably in trying to address the noise complaints.

She points out that she consented to the order sought as soon as reasonably possible.

She further submits that the costs incurred were not a consequence of the Owner’s own actions or omissions.

In the alternative, the Owner submits that the amount claimed is excessive. ### The Tenant [13] The Tenant opposes any costs order against her, arguing that it would be fair and equitable to order no costs.

She submits that she tried to address the concerns of the noise complaints reasonably.

She denies that she refused to consent to an order.

She points out that she was not made aware of the identity of the complaining neighbour (the “Neighbour”) so any efforts made by her to accommodate the problems were futile. [14] The Tenant further submits that the situation was mismanaged by 933, because no attempt was made to resolve the noise problem by way of a meeting among the parties involved.

Because 933 withheld pertinent information and did not inform her who was complaining or explain the nature of the layout of the Neighbour's apartment, the problem turned into a legal situation, when that outcome could have been avoided.

On several occasions, management of 933 refused to discuss the situation directly with her, rather than providing information that might have resolved the problem in a straightforward fashion. [15] In addition, the Tenant seeks an award of costs in her favour for disbursements totaling $1,421.52.

This includes a so-called "condo charge" of $1,034.52, which I assume is the amount of costs paid by her at the time the initial noise complaint was addressed. ## Analysis ### Liability for costs [16] As I have outlined above, under the Courts of Justice Act, a successful litigant ordinarily is granted an order for costs against an unsuccessful litigant unless there is a good reason to depart from that principle.

As well, under the Condominium Act, a condominium corporation that succeeds in obtaining a compliance order is ordinarily entitled to recover its actual legal costs from the unit owner, over and above the costs it might be awarded under the Courts of Justice Act.

The question to address, therefore, is whether there are any extenuating circumstances that should relieve either of the respondents from their usual liabilities. [17] In view of the opposing positions described above, it is worthwhile reviewing the history of the actions taken by the parties.

The following is a brief summary: * **July 31, 2017** – first record of a complaint from Neighbour. * **August 31, 2017** – letter from 933 to Owner advising about Tenant listening to very loud music after 11:00 PM on a regular basis.

Despite 933’s knowledge of Owner’s address for service, this not sent to Owner but instead to the unit’s address, where it came to the attention of Tenant.

Owner unaware of complaint. * **September, October and November 2017** – further complaints from Neighbour to 933 about noise from Tenant’s unit. * **November 9, 2017** – letter from 933 about noise from Tenant’s unit.

Received by Tenant but not by Owner. * **November 17, 2017** – registered letter from 933’s counsel sent to Owner at her proper address and copied to Tenant.

This is first notice to Owner about any noise complaints.

It lists 8 occasions on which excessive noise was caused by Tenant and recites that “[t]his is your final warning.” It demands payment of 933’s legal costs, which are paid by Owner and Tenant. * **November 2017** – following receipt of November 17, 2017 letter, Owner’s representative speaks to Manager of 933 and to Tenant to learn about and address noise issues and their amelioration.

Owner hears nothing further from 933 for over 7 months. * **June 27, 2018** – Neighbour again complains in writing to 933 about noise from Tenant’s unit. * **June 28, 2018** – letter from 933 to Owner reporting additional noise complaints and advising that Owner terminate Tenant’s lease. * **June/July 2018** – Owner's representative contacts Tenant to discuss latest letter from 933 and to suggest Tenant move out since they didn’t know who was making the complaints but they appeared to be continuing.

Tenant responds that she is looking to buy a residence and will move out then and, in the meantime, will be diligent in keeping the noise down.

Nothing further heard from 933 until November 28, 2018. * **July 6, 2018** – Tenant writes to management of 933 to express her view that the complaining Neighbour (who has not been identified to her) was being unreasonable and that 933 was not conducting a fair investigation or taking steps to intervene to resolve the situation.

When no response is received, Tenant speaks to management of 933, but the discussion is unproductive. * **October and November 2018** – Neighbour again complains to 933 about noise from Tenant’s unit. * **November 28, 2018** – letter from 933 to Owner regarding additional noise complaints, requesting that Owner terminate lease and have Tenant move out within 30 days.

Also requests Owner to inform Tenant not to communicate with management of 933. * **Late November/early December 2018** – Owner’s representative contacts Tenant to discuss further noise complaints and to request her to move within 30 days.

Tenant responds she cannot meet that timeline over the Christmas holidays.

Owner’s representative also seeks legal advice regarding possible proceedings before the Landlord and Tenant Board to terminate tenancy but is advised that application will likely not succeed. * **December 2, 2018** – Tenant writes to management of 933 to address latest noise complaint, explaining her position, expressing the view that the complaints are unwarranted and asking “to be heard on this matter.” Instead of responding to Tenant, 933 requests Owner to instruct Tenant not to communicate with it, on the basis that all communications should be through Owner, except in emergencies. * **December 27, 2018** – 933 informs Owner that Neighbour has moved from unit.

Owner’s representative forwards letter to her legal counsel. * **January 8, 2019** - Owner's legal counsel writes to 933 advising that no steps will be taken to terminate the Tenant’s tenancy because the complaining Neighbour has moved out and without her evidence such an application would fail. * **January 9, 2019** – 933 writes back explaining that the Neighbour had only moved out temporarily and reminding counsel that January 12, 2019 (three days later) is the date 933 has requested the tenancy be terminated. * **January 9, 2019 to March 18, 2019** - No further direct contact between parties. * **February 19, 2019** – Notice of Application is issued, returnable April 12, 2019.

It is not served until affidavits are sworn.

In due course, it is supported by affidavits sworn by Neighbour (sworn March 18, 2019) and a representative of 933 (sworn March 19, 2019). * **March 18, 2019** – 933 notifies Owner of further noise complaints from Neighbour. * **March 25, 2019** - counsel for 933 asks counsel for Owner if he will accept service of the application materials.

Upon receipt of materials, Owner and her counsel (and Tenant) learn for the first time the identity and unit number of the complaining Neighbour. * **April 1, 2019** - Owner consents to a partial order only.

Her counsel advises she will not consent to a declaration that the Owner breached the Act or the Governing Documents as she denies that she has breached any of these and is therefore not willing to consent to such a declaration. * **April 12, 2019** – initial hearing before Stinson J. Matter is not concluded and is therefore adjourned to a new date.

Parties are encouraged to seek a resolution, failing which a new date to complete argument must be scheduled and a proper Compendium of material must be filed. * **April 12, 2019 to September 24, 2019** – counsel for 933 unsuccessfully attempts to secure agreement of Tenant to consent to a declaratory order that she has breached the Act and 933’s Declaration and noise bylaw and offers to forego any claim for costs.

Parties cannot agree on terms. * **December 3, 2019** – further appearance in court to make final submissions. * **January 13, 2020** – Stinson J. releases decision finding that Tenant has breached 933’s Noise Bylaw. ### Liability of the Tenant [18] I will deal first with the question of the Tenant's liability to pay costs.

As I have explained above, the court's authority to make an order for the payment of costs in a condominium compliance case is twofold.

First, under the Courts of Justice Act, and second, under the Condominium Act, ss.134(3) and (5).

Specifically, s.134(3)(b)(ii) of the Condominium Act gives the court to order responding parties to pay the costs incurred by an applicant condominium corporation in obtaining a compliance order.

As well, s. 134(3)(c) empowers the court to "grant such other relief as is fair and equitable in the circumstances." In addition, s.134(5) empowers the court to direct that "any additional actual costs to the corporation in obtaining the order" be added to the common expenses for the unit.

As the case law cited above indicates, these "additional actual costs” can encompass legal costs owing as between the client and its own lawyer, beyond the costs that the court has ordered paid by an opposing party. [19] I do note that s.134(5) contemplates that these "additional actual costs" are to be added to the common expenses for the unit.

In that sense, therefore, s.134(5) does not expressly address the question of the potential liability of a tenant or occupant (as opposed to an owner) being ordered to pay such costs.

That said, it seems to me to be unfair and inequitable that, where a tenant is the underlying cause of the problem that gave rise to the proceeding in which the compliance order was sought, the owner alone should bear responsibility for these additional costs.

I would therefore interpret the power given to the court under s.134(3)(c) to “grant such other relief as is fair and equitable in the circumstances" to encompass the power to order a tenant or occupant to pay such “additional actual costs" where it is fair and equitable to do so. [20] Turning to the specific facts of this case, for the reasons that follow, I conclude that it is appropriate to order the Tenant to pay costs under the Courts of Justice Act and as well "additional actual costs" under s.134(5) of the Condominium Act: 1.

The Tenant was clearly an unsuccessful party in the litigation.

In my decision released January 13, 2020, I found that the Tenant had breached the Noise Bylaw of 933 and I ordered her henceforth to comply with the Condominium Act and the Rules of 933.

Thus, 933 was successful in obtaining the relief against the Tenant that it sought. 2.

The basis for my finding that the Tenant was in breach of the Noise Bylaw was my finding that she created excessive noise at various times of the night when most occupants would expect to be sleeping or engaged in relatively quiet activities. 3.

In my decision I found as a fact that, on repeated occasions, complaints of excessive noise from the Tenant's unit were investigated by representatives of 933 and found to be substantiated. 4.

I accepted the Neighbour’s evidence that her log accurately recorded at least 25 separate noise problems between July 2017 and March 2019.

This reflects the severity and seriousness of the disturbance caused by the Tenant. 5.

In addition to the multiple late night attendances by the concierge at the Tenant's door to address noise complaints, on three separate occasions the Tenant received written communications from 933 providing formal notice of her non-compliance with the condominium Noise Bylaw by making excessive noise.

There can be no doubt that the Tenant was aware of the problems she was creating.

Although the noise issues abated from time to time following the formal notices, they resumed and continued into early 2019, shortly before the commencement of the proceedings.

Indeed, subsequent to the initial hearing on April 12, 2019, additional noise issues arose in August and September 2019. 6.

Additionally, subsequent to the initial hearing on April 12, 2019, the tenant was provided the option of consenting to the relief sought by 933 on the basis that it would forego any order as to costs.

Despite ample opportunity to consider and accept that proposal, the Tenant refused, which resulted in the matter returning to court in December 2019 which in turn lead to my decision of January 13, 2020. [21] I am, of course, alert to the Tenant's submissions that she tried to address the concerns of the noise complaints reasonably and that the situation was mismanaged by 933 because no attempt was made to resolve the noise problems by way of a meeting among the parties involved.

Those facts do not detract from the underlying reality that the Tenant continued to breach the Noise Bylaw and to disturb her neighbour.

To the extent those facts may be a factor that I should consider in my relation to awarding costs, they relate to the issue of the amount of costs that should be awarded and not whether liability for costs should be imposed. [22] I note that the Tenant requested a costs award in her favour.

Since she was unsuccessful in the proceedings, I see no basis to grant that relief. ### Liability of the Owner [23] I turn next to the liability of the Owner for costs.

The same legal framework applies here.

The factual circumstances involving the Owner, however, are significantly different than those involving the Tenant.

In essence, the Owner argues that she is not at fault, because she acted reasonably in trying to address the noise complaints and she consented to the order sought as soon as reasonably possible. [24] The Owner correctly points out that she was unaware of complaints of noise at the unit – first reported to 933 in July 2017 – until November 17, 2017.

Management of 933 never informed the Owner about the issue on an ongoing basis and failed to provide any notice of the earlier noise complaints to the Owner, despite having her address for service.

When she received the written complaint in November 2017, the Owner promptly contacted the Tenant to discuss the matter and make suggestions to reduce the noise. [25] The Owner next heard from 933 about noise issues in late June 2018, over seven months later.

She had no knowledge of any ongoing problems, despite the fact that the Neighbour continued to experience them in December 2017 and in February, May and June 2018.

When the Owner heard from 933 in June 2018, she again contacted the Tenant and urged her to move out.

In response, the Tenant advised that she was looking to buy a residence in the near future and would move then.

In the meantime, the Tenant assured the Owner that she would be diligent in keeping the noise down. [26] Despite ongoing complaints from the Neighbour in October and November 2018, 933 next advised the Owner regarding a further noise complaint in November 2018.

On this occasion, acting with the benefit of legal advice, the Owner requested the Tenant to move out, and sought information from 933 to assess whether there was evidence to support an application to terminate the tenancy. 933 did not supply the Owner with recordings and did not even identify the complaining neighbour so there was no witness for purposes of a Landlord and Tenant Board application to terminate the tenancy. 933 also erroneously informed the Owner that the Neighbour was moving out of her unit and then renewed its demand that the Owner evict the Tenant. [27] Ultimately, when this application was commenced, the Owner did not oppose the relief sought as regards the Tenant and merely took the position that no relief or costs should be awarded as against her. [28] This is a case quite unlike Chan or Skyline, in which the unit owners flagrantly breached the condominium corporations’ rules.

In this case, 933 did not properly communicate to the Owner regarding the complaints of the Neighbour.

On two occasions, it failed to send her any notice at all, despite being aware of her address for service.

When 933 demanded the Owner take steps to evict the Tenant, it imposed arbitrary and unreasonable deadlines and failed to provide information that would have facilitated the Owner taking steps to end the tenancy if appropriate. [29] 933 allows unit owners to lease their units – indeed the units occupied by both the Tenant and the Neighbour are owned by individuals who have chosen to do so.

It is understandable that 933 (and all condominium corporations) should be able to look to the unit owners for ultimate compliance with the corporation’s Rules and Declaration, whether the breach is by a unit owner or a tenant.

This principle is codified in s.119(2) of the Condominium Act.

That said, where (as here) a compliance order is sought and the corporation seeks complete indemnity for its costs, it would be neither fair nor equitable to overlook the circumstances that lead to the proceeding when deciding the question of costs. [30] Diamond J. considered this issue in [Toronto Standard Condominium Corporation No. 2032 v. Boudair, et al., 2016 ONSC 509](https://www.canlii.org/en/on/onsc/doc/2016/2016onsc509/2016onsc509.html) where he wrote (at para. 23) as follows: > Pursuant to section 119(2) of the Act, every owner must take “all reasonable steps” to ensure that an occupier of that owner’s unit comply with the Act and the applicant’s declarations, by-laws or rules.

The term “reasonable steps” is not defined.

In [Carleton Condominium Corporation No. 555 v. Legace](https://www.canlii.org/en/on/onsc/doc/2004/2004canlii26137/2004canlii26137.html), Justice Aitken observed [at para.20] as follows: > > The Condominium Act, 1998 does not establish the strict liability of unit owners for all infractions of tenants, even if they have had no notice of the infractions.

The wording of s. 119(2) to the effect that an owner shall take “all reasonable steps” to ensure that an occupier of the owner’s unit complies with the Act, the declaration, the by-laws and the rules, implies that the owner has to know what is going on at the unit so that he or she can take whatever steps would be reasonable to deal with any problems.

Put another way, it only stands to reason that the owner has to be notified of any unacceptable conduct on the part of the tenant if it is the owner’s responsibility to vouch for that conduct and to take reasonable steps to correct problems.

In many, if not most, situations, the unit owner who is renting to a tenant does not live at the condominium complex.

If the property manager of the complex does not inform the owner of tenant infractions, how can the owner live up to his or her responsibility to ensure that the tenant abides by condominium rules?

It would be contrary to public policy to expect unit owners to become private investigators checking up on their tenants to see if they are breaching any rules.

It makes much more sense for the condominium’s property manager to notify the unit owner of any significant or on-going breaches. [31] I agree with those comments, which are applicable to the facts of this case.

I also cannot overlook the willingness of the Owner to consent to the very relief that was granted. [32] 933’s repeated failure to inform the Owner of the ongoing problems and its unreasonable demands to the Owner to terminate the tenancy while providing no evidentiary assistance for the Owner to obtain such relief, as well as the Owner’s willingness to consent to the relief obtained, all persuade me that this is a situation in which no order as to costs should be made as against the Owner, either under the Courts of Justice Act or the Condominium Act. ### Amount of Costs [33] The total legal expense incurred by 933, as set out in its Bill of Costs, is $33,469.73.

That sum represents the legal bills incurred by 933 in preparing and prosecuting the application before me.

It also includes the professional time spent in attempting to achieve a resolution of the dispute, something the Tenant was unwilling to do. [34] The time spent and the hourly fees charged are detailed in a formal Bill of Costs.

For the most part, the hours and rates are unremarkable for a proceeding such as this.

The only notable excess is the duplication of senior and junior counsel time on the first appearance.

I am also surprised at the disbursement for process server fees.

Taking those factors alone into consideration, I would reduce the sum claimed for Full Indemnity costs to $31,000. [35] I am not prepared to award that amount, however, for two reasons.

First, I find there is some merit to the Tenant’s submission that she was rebuffed when she attempted to deal with 933 in trying to remedy the noise problems.

She was told she should communicate via the Owner and that management of 933 did not wish to deal with her.

She was not given any information regarding the complaining neighbour or the layout of their apartment, which precluded her from trying to resolve the problem by modifying her own layout to reduce the likelihood of further problems.

Although 933 has an obligation to enforce its bylaws and rules, its communication style left something to be desired, which suggests that complete indemnity costs are not warranted. [36] Secondly, the underlying principle of a costs award is that it should be “fair and reasonable” taking into account the principle of indemnity for the successful party, the expectations of the unsuccessful party and the complexity of the issues and with a view to balancing compensation of the successful party with the goal of fostering access to justice: [Boucher v. Public Accountants Council (Ontario)](https://www.canlii.org/en/on/onca/doc/2004/2004canlii14579/2004canlii14579.html), 71 O.R. (3d) 291 (C.A).

An award of costs of the magnitude of $31,000 against the tenant would, in my view, be excessive when measured against these criteria.

It would also fail to take into account the shortcomings of the conduct of 933 that I have detailed above.

At the same time, I cannot overlook the refusal of the Tenant to accept 933’s offer to resolve the case on a “no costs” basis if she consented to the very relief that was ultimately granted. [37] Taking into account these considerations, I would reduce the $31,000 otherwise claimable by 25%.

I therefore fix 933’s recoverable costs at the all-inclusive sum of $23,250. ## Conclusion and Disposition [38] For these reasons, I fix 933’s costs at $23,250 and order the respondent Saskia Kalicharan to pay that sum within 90 days.

Ms. Kalicharan’s claim for costs is dismissed.

No costs were sought by the Owner and I award none against her. --- Justice D. G. Stinson Date: June 22, 2020

The Toronto Standard Condominium Corporation No. 1724 brought an application against a unit owner, Evgeni Evdassin, for a compliance order to replace defective Kitec pipes and for various other permanent prohibitory orders, seeking costs on a full indemnity basis.

The court granted the compliance order for pipe replacement, as the unit owner had largely consented to this, but dismissed the broader prohibitory orders, finding the Condominium had over-reached.

On the issue of costs, the court declined to award full indemnity costs, emphasizing that section 134(5) of the Condominium Act provides an enforcement mechanism for actual costs but does not dictate the court's assessment of costs.

The court awarded partial indemnity costs, reducing the amount claimed due to the Condominium's partial success and over-reaching on certain requests.

The Condominium Corporation sought compliance orders against a unit owner for refusing access to replace defective Kitec pipes and for alleged abusive and interfering behaviour.

The court ordered the owner to allow access for pipe replacement and to pay associated costs, finding he had interfered with the work.

However, the court declined to issue broader, indefinite compliance orders regarding future conduct, finding the alleged misconduct was not sufficiently persistent or egregious to warrant such extensive restrictions, and that some evidence was inadmissible hearsay.

The Applicant, First Condo Group Ltd., sought an order for insurance coverage from the Respondent, Lloyd’s Underwriters, which was dismissed in a prior application.

This decision addresses the Respondent's claim for costs on a partial indemnity basis, totaling $31,548.48.

The Applicant argued the Respondent's counsel fees were excessive given the limited scope of the application and compared them to its own billable hours.

The court found the Respondent's costs claim reasonable, noting the serious nature of the underlying application (exposing Lloyd's to $2 million liability) and the helpfulness of the legal research, and granted the full amount requested.

The applicant condominium corporation sought a declaration and compliance order against a unit owner and her tenant for repeated breaches of noise rules.

The tenant, Ms. Kalicharan, was found to have created excessive noise disturbing a neighbour, and the owner, Ms. Lyn, was responsible for ensuring tenant compliance.

The court found the corporation's enforcement discretion was exercised reasonably and in good faith, granting the declaration and compliance order, but declined to order tenancy termination as that falls under the Landlord and Tenant Board's jurisdiction.

Costs were to be addressed separately.

The applicant, an engineering firm, sought insurance coverage from the respondent for a professional negligence claim.

The claim arose from a reserve fund study completed in November 2013, which allegedly failed to identify a corroded lamppost.

A worker was injured in October 2015 due to the lamppost's collapse.

The insurer denied coverage based on a retroactive date exclusion clause (September 11, 2015), arguing the "incident" was the negligent study preparation (2013), which occurred before the retroactive date.

The applicant contended the "incident" was the worker's injury (2015), which occurred after the retroactive date.

The court dismissed the application, finding that the word "incident" in the exclusion clause unambiguously referred to the alleged misconduct in 2013, not the subsequent injury in 2015.

The appellant appealed a one-year sentence for civil contempt imposed by the trial judge.

The appellant argued the sentence was excessive, that the judge was inflamed by the appellant's non-compliance with asset freezing and disclosure orders, and that the sentence was purely punitive rather than coercive.

The appellant also contended the sentence was out of line with other civil contempt cases.

The Court of Appeal dismissed the appeal, finding the sentence appropriate given the appellant's multiple opportunities to purge contempt, attempts to deceive the court, the brazen and deliberate nature of the contempt, the underlying $7 million civil fraud, and the lack of asset recovery despite the judge's delay in imposing sentence.

This application sought a determination of contractual rights regarding an early termination provision in pre-construction condominium agreements.

The applicants argued that a 'sole, absolute and unfettered discretion' proviso in a financing condition rendered the entire condition null and void under the Tarion Addendum, leading to a breach of contract claim.

The court found that the proviso did not form part of the early termination condition or, if it did, it was inconsistent with the Addendum's requirement for commercially reasonable steps and was therefore unenforceable.

The court interpreted the condition to require vendors to take all commercially reasonable steps to arrange satisfactory financing, upholding the validity of the termination condition and dismissing the application.

The plaintiff brought a motion to find the defendant in contempt of court for violating freezing orders issued following a trial that found the defendant liable for a $7.3 million fraud.

The court found beyond a reasonable doubt that the defendant had actual knowledge of the clear and unequivocal orders, yet intentionally failed to disclose his worldwide assets and actively dissipated hundreds of thousands of dollars to offshore accounts and third parties.

The defendant was found guilty of civil contempt and sentenced to 50 days of incarceration, with a subsequent hearing scheduled to determine if he could purge his contempt and mitigate his final sentence.

The court heard two motions: a contempt motion by the plaintiff against the Duscio Defendants and a motion by the Garcia Defendants to vary a non-dissipation order to access funds for an appeal.

The court found Mr. Duscio in apparent contempt, issuing a bench warrant, and adjourned Mrs. Duscio's contempt motion with strict disclosure terms.

Regarding the Garcia Defendants' motion, the court applied the four-part Credit Valley test, distinguishing the post-judgment non-dissipation order from a pre-trial Mareva injunction.

While acknowledging some "clean" funds, the court found the Garcia Defendants had other potential funding sources and that the balance of convenience heavily favoured the creditors given the magnitude of the fraud judgment.

The Garcia Defendants were granted only $5,000 for initial appeal costs, with further relief to be sought from the Court of Appeal.

The sale of their Kitchener home was authorized, with proceeds to be paid into court. interesting_citations_summary: > This decision applies the Credit Valley four-part test for varying Mareva-like injunctions, adapting it for a post-judgment non-dissipation order following findings of fraud.

It highlights the distinction between pre-trial asset preservation and post-judgment enforcement, emphasizing that the balance of convenience shifts heavily towards creditors once fraud is established and a judgment issued.

The court's analysis of "clean" funds and alternative funding sources for impecunious debtors seeking to appeal provides guidance on the stringent conditions for releasing frozen assets in such circumstances. final_judgement: > The contempt motion against Mrs. Duscio was adjourned with strict disclosure terms.

A bench warrant was issued for Mr. Duscio.

The Garcia Defendants' motion to vary the non-dissipation order was largely dismissed, with only $5,000 granted for initial appeal costs and the sale of their Kitchener home authorized with proceeds to be paid into court.

The plaintiff was granted leave to bring a motion to vary living expenses for the Garcia Defendants. winning_degree_applicant: 1 winning_degree_respondent: 5 judge_bias_applicant: 0 judge_bias_respondent: 0 year: 2018 decision_number: 6569 file_number: "CV-11-9210-00CL" source: "https://www.canlii.org/en/on/onsc/doc/2018/2018onsc6569/2018onsc6569.html" cited_cases: legislation: [] case_law: - title: "Canadian Imperial Bank of Commerce v. Credit Valley Institute of Business and Technology" url: "https://www.canlii.org/en/on/onsc/doc/2003/2003canlii12916/2003canlii12916.html" keywords: - Contempt of court - Non-dissipation order - Mareva injunction - Fraud - Asset freezing - Motion to vary - Appeal funding - Balance of convenience - Credit Valley test - Disclosure of assets areas_of_law: - Civil Procedure - Commercial Law - Equity - Enforcement of Judgments --- # Court File and Parties **COURT FILE NO.:** CV-11-9210-00CL **DATE:** 20181101 **SUPERIOR COURT OF JUSTICE – ONTARIO** (COMMERCIAL LIST) **RE:** CAJA PARAGUAYA DE JUBILACIONES Y PENSIONES DEL PERSONAL DE ITAIPU BINACIONAL, Plaintiff **AND:** EDUARDO GARCIA OBREGON a.k.a.

EDUARDO GARCIA a.k.a.

EDDIE OBREGON, CLAUDIA PATRICIA GARCIA a.k.a.

PATRICIA GARCIA a.k.a.

CLAUDIA PATRICIA DE GARCIA a.k.a.

CLAUDIA SANTISTEBAN, LIGIA PONCIANO, MANAGED (PORTFOLIO), CORP., GENESIS (LA), CORP. (ONTARIO CORPORATION NUMBER 1653094, GENESIS (LA), CORP. (Alberta CORPORATE ACCESS NUMBER 2013145921), FC INT, CORP., FIRST CANADIAN INT, CORP., UNION SECURITIES LIMITED, SCOTT COLWELL, MARTY HIBBS, HIBBS ENTERPRISES LTD., COLUMBUS CAPITAL CORPORATION, ANTONIO DUSCIO, LEANNE DUSCIO, LEANNE DUSCIO carrying on business as THE QUEEN ST.

CONSERVATORY, CATAN CANADA INC., VIJAY PAUL, GREG BAKER, BRADLEY F. BREEN, LOU MARAJ, 2138003 ONTARIO INC., MACKIE RESEARCH CAPITAL CORPORATION, FIRST CANADIAN CAPITAL MARKETS LTD., FIRST CANADIAN CAPITAL CORP., FC FINANCIAL PRIVATE WEALTH GROUP INC., JASON C. MONACO, DANIEL BOASE, PAOLO ABATE, NIKOLAOS SYLIANOS TSIMIDIS, GENESIS LAND DEVELOPMENT CORPORATION, LIMITED PARTNERSHIP LAND POOL (2007), and GP LPLP 2007 INC., Defendants **AND RE:** EDUARDO GARCIA, FC INT, CORP., GENESIS (LA), CORP. (ONTARIO CORPORATION NUMBER 1653094), and PATRICIA GARCIA **AND:** UPPER CANADA EXPLORATIONS LIMITED, PARKSIDE RESOURCES CORPORATION, GLOBAL SPORT TECHNOLOGIES CORP., and CAJA PARAGUAYA DE JUBILACIONES Y PENSIONES DEL PERSONAL DE ITAIPU BINACIONAL **BEFORE:** S.F. Dunphy J. **COUNSEL:** Jacqueline L. King and John De Vellis, for the Plaintiff David Milosevic and David Cassin, for the defendants Eduardo Garcia, Patricia Garcia, Managed (Portfolio), Corp., Genesis (LA), Corp. (Ontario Corporation Number 1653094), Genesis (LA), Corp. (Alberta Corporate Access Number 2013145921), FC Int, Corp., and First Canadian Int, Corp. Christopher H. Freeman, for the defendant Union Securities Ltd. Jeremy Sacks, for Leanne Duscio No one appearing for Anthony Duscio **HEARD at Toronto:** October 31, 2018 --- # REASONS FOR DECISION [1] I have two motions before me this morning: (i) a motion for contempt and other relief dated October 2, 2018 (originally returnable October 10, 2018) brought by the plaintiff; and (ii) a motion to vary my order of May 23, 2018 brought by the Garcia Defendants (in response to which motion the plaintiff has also filed a responding motion record). [2] While the material filed before me is voluminous, the issues are not particularly complex. ## Factual background [3] At the conclusion of the trial in this matter, I indicated that there would be findings of fraud made against both the Garcia Defendants and the Duscio Defendants and ordered an immediate freezing of the assets of both groups of defendants to prevent the dissipation of assets.

All of the affected individual defendants were in the courtroom when that order was made (Mrs. Duscio may or may not have been present – Mr. Duscio definitely was and addressed me directly after my order was made).

At the time, I indicated that the evidence before me satisfied me both as to the findings of fraud that would be detailed in my reasons to follow and of the fact that all or substantially all of the assets of both groups of defendants were proceeds of the fraud that would be subject to a constructive trust with the exception of the modest employment income then being earned by Mr. and Mrs. Duscio (which income I excluded from my order).

A further “come-back” date to settle the details of the budget to be allowed the defendants for living expenses and the like was set for May 23, 2018. [4] The parties returned before me on May 23, 2018.

The Duscio defendants chose not to appear and caused a message to be conveyed alleging that they had used up their entire vacation entitlement attending trial and could not take further time off work. [5] In the case of Mr. Duscio, at least, it is clear that that explanation – albeit delivered second hand via an unwitting pro bono lawyer and not under oath – was a deliberate lie conveyed to the court with the intention to mislead the court.

His employment was of a casual nature, arranged through a temp agency that allowed him to take time off as required.

Further, his time records from that agency show no work that week at all. [6] I confirmed my non-dissipation order at that time and made further incidental orders including an order for the seizure of records relating to assets on computers and other devices.

An order was also made requiring the Garcia Defendants and the Duscio Defendants to make full disclosure of their assets and the destination of all funds transferred by them of proceeds of the Cajubi’s funds. [7] I released my reasons for judgment on October 12, 2018 and made extensive findings of fraud as against the Garcia Defendants and the Duscio Defendants. [8] I shall refer to the evidence of compliance and non-compliance with my May 23, 2018 order in the context of examining the relief sought on the motions before me. ### (a) Plaintiff’s contempt motion against Duscio Defendants [9] The plaintiff has not proceeded with its contempt motion as against the Garcia Defendants as a result of a settlement that was reached.

I shall refer to this further in the context of the Garcia Defendants’ motion. [10] The plaintiff was required to obtain an order for substituted service of the motion record on Mr. and Mrs. Duscio after their efforts at personal service of the motion record were thwarted by what can only be characterized as evasive actions by the both individuals. [11] Mrs. Duscio retained counsel the night before the scheduled return of the motion and such counsel appeared in court to request an adjournment.

Mr. Duscio has not surfaced. [12] I granted Mrs. Duscio’s request for an adjournment but on strict terms.

I explained in great detail to her counsel what would be required of Mrs. Duscio prior to the return of the contempt motion which I adjourned to November 14, 2018.

Thus far, Mrs. Duscio has allowed herself to be used as a front for her husband’s dishonest schemes in circumstances I found amounted to willful blindness in my judgment.

I am expecting a full accounting of all assets worldwide, including assets held by or for another, assets over which she has or had signing authority, assets held in the name of her children or assets held by relatives on her behalf and a full accounting of all transfers of property other than at arm’s length.

She will be cross-examined on her affidavit disclosing this information and that information will be before me on November 14 to respond both to the allegations of contempt and the steps if any she has taken to purge that alleged contempt. [13] Mr. Duscio is another matter.

He has neither appeared nor retained counsel.

His whereabouts are unknown.

The evidence of his alleged contempt that he has not yet responded to is weighty.

The evidence includes Mr. Duscio’s failure to provide any of the information required by my May 23, 2018 order as regards transfers of assets I have found belong to the plaintiff, the non-disclosure of recently-opened bank accounts and the recent sale of a property in Florida that was itself not disclosed in this sworn affidavit.

This is by no means an exhaustive list of the ways in which Mr. Duscio is alleged to have engaged in very material breaches of my orders. [14] I issued a bench warrant requiring Mr. Duscio be apprehended and brought before me to answer the charges made by the plaintiff.

Mr. Duscio has some explaining to do regarding his apparent failure to comply with my direct orders, including orders that I explained to him face-to-face in court.

Avoiding that day of reckoning by trying to avoid service, causing false and misleading excuses to be conveyed to the court on his behalf and failing to appear in court when validly summoned is not the best way to start making things right.

The window for him to appear voluntarily instead of at the side of an officer of the law following apprehension and detention is rapidly closing. ### (b) Garcia Defendants’ Motion [15] The Garcia Defendants seek an order granting them access to $150,000 from among the assets subject to my non-dissipation order for the purpose of funding their intended appeal of my judgment.

These funds are proposed to be raised from one of two sources: the cashing of a GIC (subject to the proceeds in excess of $150,000 being paid into court to the credit of this action) or the sale of their Kitchener home (with proceeds in excess similarly being deposited into court).

At all events, they seek leave to sell the Kitchener home with the proceeds being paid into court. [16] The Garcia Defendants submit that all of their funds are now subject to the non-dissipation order and that the limited budget for legal expenses allowed them by my May 23 order ($45,000) has long since been exhausted.

They intend to appeal my judgment and the balance of convenience favours affording them reasonable access to funds for this purpose.

They further submit that there are substantial assets subject to my freezing order that were paid for in part at least with funds that are not subject to my tracing order.

In particular, they submit that the family home in Kitchener (with equity far in excess of the $150,000 they now seek) was purchased with funds that are not subject to the proprietary remedy that has been granted to the plaintiff in my judgment.

In support of this allegation, the Garcia Defendants have tendered evidence that they had earnings from commissions derived from the sale of viaticals for Keystone and USI exceeding $150,000 at the time of the house purchase and that these funds were deployed to make the down payment for the Kitchener home. [17] The plaintiff takes no issue with the sale of the Garcia’s Kitchener home and the payment of the net proceeds of sale thereof into court to the credit of this action.

My order of May 23, 2018 specifically granted the Garcia Defendants access to funds for the purpose of repairing the home and preparing it for sale. [18] An order shall issue authorizing the sale of the Garcia’s Kitchener home and requiring the proceeds thereof to be paid into court.

The plaintiff’s counsel is to be consulted regarding the sales process in terms of selection of agent, listing price, process for accepting an offer if below the listing price, assurances regarding arm’s length sale and similar matters.

My intention is that the property be sold at arm’s length for the highest price reasonably obtainable with only normal and usual deductions being made from the sale proceeds before net proceeds are deposited into court to the credit of this action. [19] The Garcia Defendants submit that the proper test to be applied to their motion to vary is the four part test described by Molloy J. in [Canadian Imperial Bank of Commerce v. Credit Valley Institute of Business and Technology](https://www.canlii.org/en/on/onsc/doc/2003/2003canlii12916/2003canlii12916.html). [20] While *Credit Valley* concerned a motion to vary a Mareva injunction, my non-dissipation order was quite consciously patterned after a Mareva order but with this distinction.

There is of course an important distinction between the non-dissipation order made by me and a Mareva injunction.

A Mareva injunction is an order made to preserve assets pending trial and a final determination of the rights of the parties.

My order was made after trial and after a positive finding of fraud was made.

Judgment was deferred only for the purpose of preparing detailed reasons and for the purpose of delimiting the full extent of the damages and of the constructive trust remedy that would apply.

Subject to that distinction, I find the *Credit Valley* test to provide an appropriate template for considering the manner in which my discretion ought to be applied. [21] The four-part *Credit Valley* test examines the following questions (as simplified by me): a.

Has the moving party established on the evidence that he or she has no other assets available to pay expenses other than those frozen by the injunction? b.

Has the moving party shown on the evidence that there are assets caught by the injunction that are from a source other than the plaintiff and thus not subject to the plaintiff’s proprietary claims? c.

Has the moving party exhausted any non-proprietary assets before looking to assets subject to a proprietary claim? d.

Does the balance of convenience favour the moving party’s claim? #### (i) Availability of other assets [22] The Garcia Defendants submit with some justification that they have no assets that are not subject to my order.

I have frozen all of their bank accounts and assets worldwide and provided them with access to a particular account, and limited in amount, to pay their living and legal expenses since my order May 14, 2018 as expanded on May 23, 2018.

While the plaintiff and Union Securities both strongly suspect the existence of other assets that have not been disclosed, suspicion of such assets and evidence of them are not the same thing.

Further, any such assets, were they to exist would also be subject to my order and thus be unavailable to fund appeal or living expenses at all events. [23] In my view, the Garcia Defendants are applying an approach to this question that is considerably narrower than what I consider appropriate. [24] The proprietary remedies that I have found Cajubi is entitled to account for almost all assets that the Garcia Defendants have identified and indeed any assets that the plaintiff and Union Securities suspect – justifiably or no – that they have failed to identify.

The money claims over and above the proprietary claim far exceed any amount of money the Garcia Defendants have or are speculated to have hidden away somewhere. [25] I see no reason to speculate about what I don’t know.

The facts in this case are damning enough without asking the Garcia Defendants to shadow box to avoid conclusions premised on speculation as well.

My findings against them are harsh enough.

Absent a startling change in their fortunes, there is virtually no prospect of these claims being paid in full – ever.

Every penny that is released by me is a penny the plaintiff will never see again. [26] In such circumstances, it is reasonable in my view to ask the Garcia Defendants to fund an eventual appeal from sources other than those I have found belong to the plaintiff. [27] There are sources that the evidence before me suggests are or ought reasonably to be potentially open to the Garcia Defendants. [28] Mr. Garcia admits to having purchased a house for his mother with proceeds of Cajubi’s funds some years ago.

Cajubi has a proprietary claim to that house – or would have one were it to enforce my judgment in Guatemala if those facts can be established.

The financial capacity of Mr. Garcia’s mother and family has not been developed before me in a meaningful way and I cannot assume that it is nil given the funds he is known to have provided to her. [29] The evidence from the trial also established that Mr. Garcia caused significantly more than US$1 million to be sent to his uncle Nicolas de Leon Morales in transactions I found to be a sham.

All of the funds sent to Mr. de Leon Morales have been found by me to be subject to Cajubi’s proprietary claim.

The evidence on this motion establishes that Mr. Garcia has maintained a degree of active involvement with his uncle in recent times, allegedly opening bank accounts in Canada to “hold” money for his uncle for undisclosed purposes (although over $400,000 of such funds allegedly held for Mr. de Leon Morales were transferred to the Garcia’s in the weeks before the trial).

Mr. Garcia’s affidavit alleges that Mr. de Leon Morales had offered to help him pay his legal expenses with a loan, but Mr. Garcia did not pursue the matter. [30] I am satisfied that the Garcia Defendants have access to sources of funds to fund a possible appeal that are not subject to my non-dissipation order. #### (ii) Frozen assets not subject to plaintiff’s proprietary claims [31] Mr. and Mrs. Garcia purchased their Kitchener home in 2007.

They purchased the home for $601,000 under an Agreement of Purchase and Sale accepted September 25, 2007.

The purchase was funded with a deposit of $25,000 and payments of $226,701.36 from Mr. and Mrs. Garcia plus a mortgage.

The transaction was completed on October 22, 2007. [32] The Garcia Defendants allege that the $25,000 deposit and at least $125,000 of the $226,701.36 paid at closing to purchase the home came from funds that are not subject to the proprietary remedy that I have granted Cajubi. [33] The Garcia Defendants were receiving commission funds from Keystone in that time frame.

While such payments also derived from transactions with Cajubi and transactions where similar payments to the same Swiss bank account of the Panamanian nominee corporation that I have found to be kickbacks in this case were also made, no such claim is made before me. [34] The commission payments in question were deposited to a US dollar account with a relatively nominal balance prior to such deposits and Mr. Milosevic has been able to track the transfer of such funds to a Canadian dollar account from which a $25,000 withdrawal was made on the same day as the deposit on the real estate transaction was made in the same amount.

The actual cheque has not been produced, but I am prepared to draw the necessary inference based on the chronology and the fact that the amounts match. [35] On October 17, 2007, a transfer of $181,701.36 was made from the same Canadian dollar account of Mr. and Mrs. Garcia to an unknown destination.

Mr. Garcia’s affidavit alleges that the funds were transferred to his solicitor for the purposes of closing along with a further $45,000 from one of the other Garcia Defendants (Genesis LA).

The figures add up to the amount the solicitor reports upon in his reporting letter and is in the correct time frame.

I do not have copies of all of the cheques to verify that Mr. Garcia has not cherry picked transactions (there are many in the same time frame) to reach a desired conclusion.

I am mindful that I have found him to lack credibility and have found that he has been a party to fraud.

Nevertheless, the evidence is plausible and adds up.

I am prepared to accept that the $181,701.36 withdrawn from his joint account on October 17, 2007 was used to fund the purchase of the family home on October 22, 2007. [36] While I am prepared to make that finding, I cannot find that as much as $125,000 of such amount was derived from funds that are demonstrably not subject to the plaintiff’s tracing claim.

The relevant account had just over $10,000 in deposit in September 2007 before the house was purchased and the proceeds of Keystone commission payments were transferred in.

On October 15, 2007, it had very nearly the same amount of money on hand ($12,582).

It received $45,000 from a source subject to the plaintiff’s claim on October 16, 2007 and then a further $125,000 from the allegedly “clean” commission account on October 17, 2007.

A further $15,000 from another source was also deposited that same day before the transfer of $181,701.36 was made (and a further payment to Rogers Cable was made). [37] Mathematical precision is neither necessary nor desirable here.

By my quick math, $191,982.78 was in the joint account at the time the bank draft of $181,701.36 was drawn.

Of this total, I am prepared to accept that $125,000 originated from sources not subject to the constructive trusts that I have ordered.

That would mean that about 65% of the account from which the draft was drawn was not subject to the plaintiff’s proprietary claim.

Applying the same ratio (65%), I would conclude that approximately $118,000 of the second down payment came from sources free of the plaintiff’s proprietary claim.

This amount plus the $25,000 is very close to the $150,000 claimed to be “clear” by the Garcia Defendants on this motion. [38] I am satisfied that the moving parties have shown that at least $143,000 of the down payment for their home derived from sources that the plaintiff has not established a proprietary claim to. #### (iii) Have the moving parties exhausted non-proprietary sources first? [39] The position of the Garcia Defendants – at this point at least – is limited to a request for access to funds for the purposes of the appeal that are not subject to a proprietary claim.

I have found that at least $143,000 of the funds used to purchase the family home in Kitchener are not subject to the plaintiff’s proprietary claim. #### (iv) Balance of convenience [40] There is a lot that could go into the balance of convenience consideration.

For the reasons that follow, I do not propose to go into all of them here in any detail. [41] The plaintiff and Union ask me to consider the merits of the proposed appeal.

I don’t propose to do so.

While I certainly have the jurisdiction to do so, this is the sort of question that is, in my view, best addressed at the stage of seeking a stay – in whole or in part – of my judgment pending appeal.

I have made the findings I have made in my judgment.

They speak for themselves.

Our system contemplates appeals and vests in other hands the jurisdiction to consider whether a stay of my judgment is appropriate and, if so, on what terms.

I have no desire to tie the hands of the judge or judges who may be asked to examine that question or to duplicate the task they will have to perform. [42] The responding parties (Cajubi and Union) urge me to bear in mind that a judgment having been issued, the balance of convenience shifts towards protecting the interest of the creditors. [43] There is considerable merit to that submission.

The judgment – in both its proprietary and monetary claims – far exceeds any reasonable estimate of what is likely or probable to be collected.

An impecunious debtor so-found after trial does not have a call on the creditor’s funds to fund living or legal expenses.

Given the magnitude of this judgment, the claims of the creditors have a particular weight that might not be present in a “normal” judgment that is subject to appeal.

Any dollar spent from this point is a dollar that the creditors will almost certainly never see again. [44] The plaintiff notes that the Garcia Defendants have spent an amount approaching $1 million (more precise figures are not needed for present purposes) in this proceeding (claims and counterclaims included) to date.

This money was almost entirely proceeds of the schemes I have found to be fraudulent and of which Cajubi was the victim.

Cajubi submits that they have already funded the Garcia Defendants living expenses for years and provided the war chest used to fight them with.

They are understandably not in the mood to “give” any more after having had to expend as much as they have to obtain justice. [45] Further, while the Garcia Defendants have demonstrated that there are some assets that are at least nominally “clean” (if only because not the subject of this law suit), they have been given access to a considerable amount of money post-judgment (approximately $80,000) to pay legal and living expenses.

Such funds ought to be charged to any non-proprietary funds before being charged to the proprietary claim assets. [46] There is also the matter of the black box which is the transfers to Guatemala over the years (well over $1 million) and the unexplored, but I find solid prospects of securing some funding from one or more sources located in that country. [47] Finally, I was urged to consider that only a portion of the $150,000 sought on this motion would be destined for the appeal, a large portion apparently being earmarked to pay accrued but unpaid legal fees. [48] All of these factors lean heavily against exercising any discretion to permit the Garcia Defendants to dig their debt hole any deeper with money over which the responding parties have a strong equitable claim. [49] Against this, the Garcia Defendants urge me to consider that they have met the challenge of demonstrating the existence of assets not subject to a proprietary claim.

They assure me that they have a serious appeal that they wish to pursue.

They submit that even a “bare bones” budget for an appeal will likely entail a budget of $50,000 -$60,000 given the costs of transcripts.

They will simply not be able to proceed without access to adequate funding for legal costs and their right to appeal would be denied. [50] I have decided that this is a debate that I should have as little to do with as possible.

As I noted above, I have made my decision and it stands or falls on its own merits.

The Garcia Defendants have a substantive right to seek appellate review.

They are also entitled to ask the Court of Appeal to stay my order as regards constructive trust, tracing and non-dissipation of assets pending that appeal. [51] Mr. Milosevic objects that absent secure funding he cannot go on the record for an appeal.

I have sympathy for that position, but it is not one without an answer.

The Garcia Defendants can appeal without counsel; Mr. Milosevic can provide assistance without appearing on the record; Mr. Milosevic can appear on a lift-stay motion with a limited retainer.

Even these limited steps will require some funding however. [52] I am ordering that the Garcia Defendants shall have access to a further $5,000 to fund legal costs of filing a Notice of Appeal and bringing a lift stay or related application to the Court of Appeal.

I am of the view that that is the preferable forum to deal with this sort of question.

I am otherwise dismissing their motion without prejudice to seeking similar relief in that forum should they be so advised.

I am advised that the account from which legal expenses were previously paid has approximately $5,000 remaining in it. ## Disposition [53] I ordered the adjournment of the contempt motion as regards Mrs. Duscio until November 14, 2018 (at 8:30 a.m.) where she will appear before me represented by counsel.

I dictated the terms of that adjournment in oral reasons.

The gist of those terms was that Mrs. Duscio is to make a full report of assets and dispositions of assets in accordance with my May 23 order by November 5, 2018 and submit to cross-examination on her affidavit on November 6, 2018.

I further extended my May 23 order – for the avoidance of any doubt as to its intent – to include any and all accounts over which she had or has signing authority and required her to account for any material (over $5,000) transfers made to non-arm’s length parties including Mr. Torchia, any company associated with him, any of her children, any parents, in-laws or other family members including cousins. [54] Mr. Duscio did not appear at the motion although validly served in accordance with the order of substitute service made.

He cannot be convicted in absentia.

However, the evidence assembled by the plaintiff – coupled with the fact that the May 14, 2018 non-dissipation of assets order was made by me when he was physically present in court and was explained to him in very direct terms by me – all persuade me that there is a strong case for contempt that has been made out for him to answer. [55] I issued a bench warrant to have Mr. Duscio brought before me and invited Mrs. Duscio’s counsel to communicate to him through Mrs. Duscio how advisable it would be for Mr. Duscio to come to court voluntarily before being apprehended on the warrant I have issued to explain himself. [56] As regards the Garcia Defendants, I am making the following orders: a.

An order shall go authorizing the sale of the Kitchener home and the payment of proceeds into court on the terms described in my reasons above; b.

For greater certainty, my order of May 23, 2018 (as confirmed in my judgment of October 12, 2018) extends to any accounts over which the Garcia Defendants have signing authority and to require an accounting for any transfers of funds over $5,000 to a non-arm’s length person including children, in-laws, cousins, aunts and uncles or entities controlled by or holding funds in trust for any of these; c.

The Garcia Defendants shall have access to $5,000 of the funds currently frozen to fund legal expenses to prepare a Notice of Appeal and to bring an application for a stay of all or any part of my judgment to the Court of Appeal (I do not require Mr. Milosevic to go on the record for such appeal without knowing the outcome of the stay motion he intends to bring); d.

The plaintiff shall be entitled to bring a motion to vary my May 23 order as regards living expenses granted to the Mr. & Mrs. Garcia under my order now that the judgment has issued which motion shall be heard (if not settled by agreement) on November 14, 2018; and e.

The Motion to Vary of the Garcia Defendants is otherwise dismissed without prejudice to seeking similar relief in the context of a stay application before the Court of Appeal. [57] I am not proposing to make any further costs awards as regards the Garcia Defendants.

It is beyond doubt that the cumulative impact of the judgments and costs awards made against them to this point is well beyond anything they have any reasonable prospect of paying in their lifetimes absent a truly startling change of circumstances.

A net recovery of 10 or 20 cents on the dollar is very likely on the optimistic side.

All sides should begin to temper their future steps in this proceeding with a cold-eyed assessment of costs and benefits.

The universe of assets available to make restitution is limited – a large portion of the damages suffered has undoubtedly been lost beyond recall whatever dark suspicions may be harboured by the victims of this fraud. [58] Orders accordingly.

If counsel are unable to agree on the form of any order I have made, I am directing the parties to provide me (via my assistant) with their competing versions and indicate in a short (one page) description the nature of any disagreements between them.

I will provide any necessary directions to finalize the order and sign it myself. --- S.F. Dunphy J. Date: November 1, 2018

A Paraguayan pension fund sued over a multi-year fraudulent investment scheme involving shell corporations, forged and misleading investment materials, secret kickbacks to insiders, and concealment of the true nature of several Canadian investments.

The court found that the moving parties’ funds were diverted through Genesis, First Canadian, Union, and Columbus Note structures by deliberate fraudulent misrepresentations, breaches of fiduciary duty, knowing assistance, and knowing receipt.

The court imposed liability for over $20.8 million in damages against the principal fraud actors, declared broad constructive trust and tracing remedies, and awarded punitive damages against the principal individual wrongdoers.

Additional liability was imposed against parties involved in the Columbus Notes transactions, and full indemnity costs were awarded to the plaintiff, with substantial indemnity costs on Union Securities’ cross-claim.

The applicants, unit owners in a condominium, challenged the corporation's decision to enter into a new bulk services agreement for television and internet.

They argued the corporation lacked jurisdiction to charge the costs as common expenses without an opt-out, failed to comply with notice and approval requirements under s. 97 of the Condominium Act, and acted oppressively by ignoring a requisition for an owners' meeting.

The court dismissed the application, finding the corporation had jurisdiction under its declaration and by-laws, the incremental cost of the new internet service did not trigger the s. 97 thresholds, and the applicants failed to prove oppressive conduct.

The Garcia Defendants brought a motion for security for costs against the plaintiff, a Paraguayan pension fund, under Rule 56.01(1)(a).

The plaintiff, ordinarily resident outside Ontario, argued it had sufficient assets in Ontario, that the defendants delayed the motion, that the defendants' conduct increased costs, and that it had a meritorious case.

The court found the plaintiff's alleged Ontario assets were not unrestricted, and the defendants' explanation for delay was unreasonable.

Considering the plaintiff's substantial assets in Paraguay, the enforceability of a judgment there, the contractual relationship between parties, the defendants' counterclaim, and the defendants' vexatious conduct and unreasonable delay, the court dismissed the motion for security for costs.

The plaintiff brought a motion under Rule 49.09 seeking an order declaring that a previous motion was settled according to a draft order.

The court found that no binding settlement agreement had been reached.

Although the parties had exchanged drafts, they had also agreed that the document needed to be "cleaned up" for final review and client sign-off.

A material change was inadvertently made by the plaintiff's counsel in the "cleaned up" draft, which the defendants' client subsequently rejected.

The court emphasized that a binding agreement requires mutual intention on all essential terms and that, in this case, the final form of the draft order had not been settled, and client consent was consistently required.

The plaintiff's motion was dismissed.

The parties agreed to the costs of the appeal.

The Court of Appeal awarded costs to the respondent in the agreed amount of $15,000 inclusive of disbursements and taxes.

The appellant condominium corporation appealed the dismissal of its application seeking a declaration that a by-law and warranty agreement entered into by the declarant-appointed board were invalid.

The agreement limited the declarant's liability for common element deficiencies to the statutory warranties under the Ontario New Home Warranties Plan Act.

The Court of Appeal dismissed the appeal, finding that the by-law was within the board's broad authority under section 56 of the Condominium Act, was not contrary to the Act or the declaration, and was not unreasonable.

The court held that the initial directors acted lawfully in organizing the condominium's affairs as anticipated by the declaration and disclosed to purchasers.

During a Commercial List case conference in a complex multi‑party commercial dispute, the court addressed ongoing discovery and production issues among numerous defendants and third parties.

The court directed timelines for outstanding undertakings and warned that unresolved production disputes would require formal motions before a Master.

The court emphasized counsel’s obligation to cooperate in resolving discovery issues and indicated that failure to do so could result in elevated or full indemnity costs.

Additional guidance was provided regarding potential motions for non‑party examinations and production of partnership financial statements.

The court scheduled a further case conference and noted that the matter would not proceed to trial as early as previously anticipated due to outstanding discovery issues.

During a Commercial List case management conference in a complex multi‑party securities and investment dispute, the court issued procedural directions governing ongoing litigation steps.

The court addressed the potential settlement motion involving certain defendants, confirmed the status of examinations for discovery, and ordered timelines for answering undertakings.

The judge provided structured options for handling refusals motions and warned that costs may be assessed per refusal to discourage unnecessary motions.

Additional directions were given regarding the timing of expert reports, a possible future summary judgment motion, and scheduling of the next case management conference.

The plaintiffs, employees of eHealth Ontario, brought a motion to certify a class action against eHealth for breach of contract and against Ontario for inducing breach of contract, relating to the non-payment of performance awards and merit increases.

The plaintiffs also moved to amend their statement of claim to add a claim for the 2011/2012 performance awards.

The court granted the motion to amend and certified the action as a class proceeding against eHealth, finding that the breach of contract claims were not plainly and obviously doomed to fail.

However, the court refused to certify the claim against Ontario for inducing breach of contract, finding it legally untenable.