Court File and Parties

Divisional Court File No.: 23/05 Court File No.: 04-CV-263816CM3 Date: 2005-02-18

Superior Court of Justice - Ontario (Divisional Court)

Re: Jim Ryan in Trust v. Kaukab et al.

Before: Mr. Justice Ferrier

Counsel: Sandra L. McNeely for the plaintiff J. Sebastian Winny for the defendant

Heard: January 28, 2005

Endorsement

Reasons for Decision on Leave Application

[1] There are two central aspects of the decision of Low J. that require consideration on this leave application. The first is the setting aside of the default judgment against Naseem without having heard oral argument concerning that issue. The second aspect relates to the effect of HSBC Bank of Canada v. Deloitte Touche et al. (2004), 71 O.R. (3d) 355 (C.A.).

[2] As to the first, I am not persuaded that there has been a breach of fundamental fairness and a denial of due process. Lengthy factums were filed by both sides. The circumstances surrounding the obtaining of default judgment and the steps taken by Naseem to have it set aside were dealt with fully in the factums before Low J. Her reasons for setting aside the judgment against Naseem, notwithstanding that she did not hear argument, do not reflect an unreasonable approach or an unlawful approach to an unusual and difficult fact situation.

[3] It is the correctness of the decision below which is reviewed under rule 62.04(2)(b). On this aspect I am not of the view that there is good reason to doubt the correctness of the order below, and this is so even if procedural fairness was denied to the plaintiff.

[4] Any such failure of due process in the circumstances of full written argument, and on the facts of the case at bar, did not materially affect the rights of the plaintiff.

[5] Even if wrong on this point, I am of the view that on this record in these circumstances, matters of general public importance are not engaged. Thus, the requirements of rule 62.02(4)(b) have not been satisfied.

[6] As to the second aspect, I am of the view that in the context of the facts at bar, HSBC Bank of Canada v. Deloitte Touche, supra, does not prevent the vesting order from being set aside with the consequent “deregistration” under the Land Titles Act, R.S.O. 1990, c.L.5. In the case at bar, the plaintiff cannot be said to be an innocent third party entitled to rely on the vesting order as registered. Accordingly, there is not a “conflicting decision” under sub-rule (a) of rule 62.04(2).

[7] Furthermore, it was open to Low J. to make an order vesting title back in the defendants, thus removing any concern for the effect of the HSBC case.

[8] In these circumstances I am not of the view that it is desirable that leave be granted.

[9] Leave to appeal is denied.

[10] The defendants are to make brief written submissions as to costs within ten days. Plaintiff to respond within a further five days.

Ferrier J.

Released: February 18, 2005

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