Derakhshan v. Narula
Ontario Reports
Court of Appeal for Ontario
Hoy A.C.J.O., Rouleau and Benotto JJ.A.
July 25, 2018
142 O.R. (3d) 535 | 2018 ONCA 658
Case Summary
Civil procedure — Appeal — Extension of time — Self-represented appellant serving notice of appeal one day late because he was misinformed about appropriate appellate court — Motion judge dismissing appellant's motion for extension of time for serving and filing notice of appeal — Motion judge erring in finding that there was prejudice to respondent on basis that her costs award was unlikely to be satisfied — Justice of case requiring that extension be granted despite appellant's inability to demonstrate merits of appeal at this stage of proceedings.
The appellant claimed retroactive spousal support and asserted a constructive trust interest in the respondent's assets. He was self-represented at trial. The trial judge dismissed the action, finding that the parties were not in a spousal relationship and that the appellant had been compensated for his services in relation to the respondent's properties. The appellant served a notice of appeal within 30 days. When he tried to file the notice, he discovered that he had been misinformed about the appropriate appellate court. He served a new notice of appeal on the 31st day and brought a motion for an order extending the time to file the notice of appeal. The motion judge dismissed the motion, finding that an extension would prejudice the respondent because it appeared unlikely that her substantial award for costs of the trial would be satisfied and that the appeal appeared to be meritless. The appellant appealed.
Held, the appeal should be allowed.
Per Rouleau J.A. (Hoy A.C.J.O. concurring): The motion judge erred in finding that there was prejudice to the respondent on the basis that her costs award was unlikely to be satisfied. That was not prejudice caused by the delay. The respondent did not suffer any prejudice as a result of the very short delay. While it was difficult to discern any merit to the appeal, it would be unfair to deprive the appellant of his right of appeal in the circumstances. The trial decision rejected his claim for several millions of dollars and ordered him to pay costs in excess of $250,000. The justice of the case required granting the extension, despite the appellant's apparent inability at this stage of the proceeding to demonstrate the merits of his appeal.
Per Benotto J.A. (dissenting): While the motion judge referred to the outstanding costs order as "some prejudice", he did not rely on prejudice as a ground for refusing the extension. A request for an extension of time -- even after an inconsequential delay -- is subject to a review of the merits to determine whether the justice of the case requires an extension. This appeal had so little merit that the extension should be denied.
Cases Referred To
- Auciello v. Mahadeo, 2016 ONCA 414 (in Chambers)
- Denomme v. McArthur, 2013 ONCA 694, 36 R.F.L. (7th) 273 (in Chambers)
- Derakhshan v. Narula, 2018 ONSC 537 (S.C.J.)
- Duca Community Credit Union Ltd. v. Giovannoli, 142 O.A.C. 146, 4 C.P.C. (5th) 189 (C.A.)
- G. (D.) v. F. (A.), 2014 ONCA 436
- Kerr v. Baranow, 2011 SCC 10, [2011] 1 S.C.R. 269, 328 D.L.R. (4th) 577, 64 E.T.R. (3d) 1, 93 R.F.L. (6th) 1
- Monteith v. Monteith, 2010 ONCA 78 (in Chambers)
- Paulsson v. Cooper, 2010 ONCA 21
Statutes Referred To
Rules and Regulations Referred To
Proceedings
APPEAL from an order dismissing a motion for an extension of time for serving and filing of a notice of appeal.
Farhad Derakhshan, acting in person.
Ian Vallance, for respondent.
Decision
Majority Opinion
[1] ROULEAU J.A. (HOY A.C.J.O. concurring): — Farhad Derakhshan brings this motion pursuant to s. 7(5) of the Courts of Justice Act, R.S.O. 1990, c. C.43 to set aside the order of the chambers judge, dismissing his motion for an order extending the time within which to serve and file a notice of appeal from the trial judge's decision rendered on January 24, 2018 [[2018] O.J. No. 404, 2018 ONSC 537 (S.C.J.)].
[2] As I will explain, I would allow the motion and grant the extension.
Background
[3] The applicant represented himself during the 21-day trial, which took place in the Family Court Branch of the Superior Court of Justice in Ottawa. He claimed retroactive spousal support, and asserted a constructive trust interest in the respondent's assets on the basis of unjust enrichment or a joint family venture. Further, he sought the return of 49 of his shares in Turtle Island Staffing Inc. (formerly 2093030 Ontario Inc.) or payment for the shares, which he alleged had been transferred to the respondent by means of forgery. The total value of his claims was approximately $4.5 million. At the close of the trial, the trial judge reserved her decision.
[4] Some nine months later, the trial judge issued a 107-paragraph decision dismissing the applicant's action. She found that although the parties had been in a romantic relationship, it was not a spousal relationship. Consequently, the applicant's claims for spousal support and a constructive trust interest in the respondent's property on the basis of a joint family venture failed. As to his unjust enrichment claim, the trial judge found that the applicant had been compensated for his services in relation to the respondent's properties. Finally, the trial judge found that there was no evidence to support the applicant's claim that the respondent had improperly taken his shares in Turtle Island Staffing Inc. Costs were awarded to the respondent in the total amount of $251,028.
[5] When the decision was released on January 24, 2018, it was e-mailed to the applicant, who was in Australia at the time. He made arrangements to rush back to Canada to deal with his proposed appeal. The trial transcripts were ordered on February 20, 2018. The applicant prepared a notice of appeal and served the respondent within the 30 days provided in the rules, on Friday, February 23.
[6] Unfortunately, upon attempting to file the notice with proof of service, he discovered that the information he had been provided as to the appropriate appellate court was in error. The materials he served on the respondent took the form of an appeal under the Family Law Rules, O. Reg. 114/99, and were addressed to the Superior Court of Justice rather than to the Court of Appeal. As a result, his materials were refused by the court office.
[7] It is understandable that the applicant, who was self-represented at the time, was mistaken as to the appropriate forum in which to advance his appeal. When he was informed of this error, he acquired the requisite forms and began to prepare a new notice of appeal directed to this court.
[8] The following day, Saturday, February 24, the applicant served this new notice of appeal on the respondent's solicitor by e-mail. This was 31 days following the release of the decision. A hard copy of the notice of appeal followed on the Monday.
[9] The applicant sought the respondent's consent to the late filing of his notice of appeal. That consent was refused and the applicant then promptly prepared the motion for an order extending the time in which to file the notice of appeal.
[10] On the proposed appeal, the applicant asserts that the trial judge misapprehended or overlooked evidence and interfered with the presentation of his case. He submits that a new trial should be ordered because the trial judge's reasons were inadequate and were not released until nine months after the trial.
Chambers Decision
[11] On the motion, the chambers judge identified the relevant factors on a motion for an extension of time under rule 3.02 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. He was satisfied that the intention to appeal had been formed within the relevant time period and that the very short delay had been explained. He found, however, that the three other factors, namely, prejudice to the respondent, the merits of the appeal and the justice of the case, did not favour granting the extension.
[12] The chambers judge found that an extension would prejudice the respondent because it appeared unlikely that her substantial award for costs of the trial would be satisfied. He noted that another outstanding costs order against the applicant in a more modest amount had not yet been paid.
[13] As for the merits of the appeal, the chambers judge determined that from the material that had been filed he was "unable to tease out anything of substance to support a claim of palpable and overriding error or of any material misapprehension of evidence". He noted that this was a fact-based appeal, and that appellate courts do not retry cases.
[14] The chambers judge concluded that the justice of the case did not warrant an extension. He noted again the unlikelihood that the respondent's cost award would be satisfied.
[15] The chambers judge therefore dismissed the motion for extension and ordered costs to the respondent in the amount of $1,500.
Analysis
[16] As I have noted above, the chambers judge correctly identified the relevant factors on a motion for an extension of time.
[17] However, he erred in finding that there was prejudice to the respondent on the basis that her costs award was unlikely to be satisfied. This is not prejudice caused by the delay: see Paulsson v. Cooper, 2010 ONCA 21, at para. 2; G. (D.) v. F. (A.), 2014 ONCA 436, at para. 16. The delay was of only one day, and further, the notice of appeal, albeit to the wrong court, had been served within the 30 days provided in the rules. The respondent did not suffer any prejudice as a consequence of the very short delay.
[18] The error in the chambers judge's analysis of prejudice clearly factored into his exercise of discretion. As a result, no deference is owed to his decision.
[19] With respect to the merits of the appeal, I acknowledge that fact-based appeals are very difficult and are rarely successful. Based on what the self-represented applicant has filed and the extensive reasons of the trial judge, it is certainly difficult to discern any merit to the appeal.
[20] The final consideration is the justice of the case. At this stage, the court must balance all of the preceding factors and consider any others that may be relevant: Monteith v. Monteith, 2010 ONCA 78 (in Chambers), at para. 20.
[21] In my view, it would be unfair to deprive the applicant of his right of appeal in the circumstances. The applicant is self-represented and the notice of appeal, albeit to the wrong court, was served on the respondent within the time provided in the rules. The delay in serving the appeal materials addressed to the appropriate court was barely one day. There is clearly no prejudice to the respondent and the loss of the right to appeal is very significant to the applicant. The trial decision rejected his claim for several millions of dollars and ordered him to pay costs in excess of $250,000.
[22] In these circumstances, I am of the view that the justice of the case requires granting the extension, despite the applicant's inability at this stage of the proceeding to demonstrate the merits of his proposed appeal. This court has recognized that, in circumstances like the present, even where it is difficult to ascertain the merits, "a party is entitled to appeal and should not be deprived of that entitlement where there is no real prejudice to the other side": Auciello v. Mahadeo, 2016 ONCA 414 (in Chambers), at para. 14; Denomme v. McArthur, 2013 ONCA 694, 36 R.F.L. (7th) 273 (in Chambers), at para. 10.
[23] In conclusion, I would allow the motion, set aside the chambers judge's order dismissing the motion for extension of time and ordering costs to the respondent, and substitute an order granting the applicant an extension to serve and file his notice of appeal to 14 days following the issuance of these reasons. I would make no order as to the costs of the motion or the motion to set aside the chambers judge's order.
Dissenting Opinion
[24] BENOTTO J.A. (dissenting): -- I do not agree with my colleague's decision to set aside the chambers judge's order refusing an extension of time to appeal.
[25] The chambers judge applied the well-known test for an extension of time:
- whether the applicant formed an intention to appeal within the relevant period;
- the length of, and explanation for the delay;
- any prejudice to respondent;
- the merits of the appeal; and
- whether the "justice of the case" requires an extension of time.
[26] There was no issue with respect to the intention to appeal. The delay was brief and explained. The chambers judge addressed the remaining three considerations.
[27] My colleague concludes that the chambers judge erred by considering that the outstanding costs order against the applicant constituted prejudice to the respondent. He determines that this error factored into the chambers judge's exercise of discretion and therefore no deference is owed to his decision. I do not agree. While the chambers judge referred to the outstanding costs order as "some prejudice", he did not rely on prejudice as a ground for refusing the extension. Instead, he based his decision on the lack of merit to the appeal as factored into the justice of the case.
[28] Once an extension of time is sought, the court must consider the merits of the appeal. While the threshold for merit is low, it is nonetheless a factor.
[29] When considering the merits of the appeal, it is not with a view to determining whether the appeal will succeed, but only with a view to determining whether the appeal has so little merit that the court could reasonably deny the important right of appeal: Duca Community Credit Union Ltd. v. Giovannoli, 142 O.A.C. 146 (C.A.). I agree with the chambers judge that this appeal has so little merit that the extension should be denied.
[30] The applicant asserted at trial that he was a "spouse" of the respondent. He claimed he was entitled to spousal support and a constructive trust interest in her property based in part on the assertion of a joint family venture. Further, he sought the return of 49 of his shares in Turtle Island Staffing Inc. or payment for them. The total value of his claims was approximately $4.5 million.
[31] Following a 21-day trial, the trial judge determined that the applicant was not a spouse. Consequently, his claims for spousal support and a constructive trust interest in the respondent's property based on a joint family venture failed. The trial judge further found that even if the applicant and the respondent were in a spousal relationship, the applicant had failed to establish entitlement to, and need for, support.
[32] As to his unjust enrichment claim, the trial judge considered and applied Kerr v. Baranow, 2011 SCC 10 and concluded that the applicant was "well compensated" for any services provided to the respondent. She also found that there was no evidence to support the applicant's claim that the respondent had improperly taken 49 of his shares in Turtle Island Staffing Inc. or forged his signature on the share transfer or corporate resolutions. The applicant's own witness testified that the applicant transferred his shares in Turtle Island Staffing Inc. to the respondent at a time when they had no value.
[33] The trial judge provided extensive reasons. She made credibility assessments against the applicant and found that he was unable to prove any of his claims.
[34] In my view, a request for an extension of time -- even after an inconsequential delay -- is subject to a review of the merits to determine whether the justice of the case requires the extension. This appeal is entirely fact based and no legal error is alleged. Given the trial judge's factual findings on the core basis of the claims asserted, there is no possibility of success on appeal.
[35] Accordingly, I would dismiss the applicant's motion with costs fixed in the amount of $8,500, including costs and disbursements.
Result
Appeal allowed.
End of Document
