ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
J. MACDONALD, DAMBROT AND SANDERSON JJ.
B E T W E E N:
IQBAL DEWJI and DEWSHAF INVESTMENTS INC.
Appellants
(Defendants)
- and -
ALNOOR GULAMANI and 1119713 ONTARIO INC.
Respondents
(Plaintiffs)
Simon Schneiderman, for the Appellants (Defendants)
Michael Title and Antonin I. Pribetic, for the Respondents (Plaintiffs)
HEARD at Toronto: July 9, 2007
J. MACDONALD J.: (Orally)
1The Motions Court Judge decided that the Respondents herein (the Plaintiffs) “raise a triable issue regarding an interest in land, based on the claim for a remedial constructive trust interest in the property”. That decision is entitled to deference on this appeal: Equity Waste Management of Canada v. Panorama Investment Group Ltd. (1997), 1997 2742 (ON CA), 35 O.R. (3d) 321 (C.A.), per Laskin J.A.
2The Motions Court Judge’s role on the motion to vacate the Certificate of Pending Litigation was limited to determining whether there was a triable issue in respect of whether the Respondents (Plaintiffs) have a “reasonable claim to an interest in land”: G.P.I. Greenfield Pioneer Inc. et al. v. Moore (2002), 2002 6832 (ON CA), 58 O.R. (3d) 87 (C.A.), per Borins J.A. The requirement of a “reasonable claim” to an interest in land is found in s.103 of the Courts of Justice Act, R.S.O. 1990, c.43.
3We do not doubt that in certain cases, evidence properly may lead the Court to grant leave to register a Certificate of Pending Litigation based upon the assertion of a remedial constructive trust. See, for example, Transmaris Farms Ltd. v. Sieber (1999) 30 C.P.C. (4th) 369, per Blair J. (as he then was). A constructive trust may be imposed as a remedy for unconscionable conduct.
4The Respondents’ (Plaintiffs’) claim of an equitable cause of action is allegedly based on unconscionable conduct of the Appellants (Defendants) arising after the contract was terminated, including:
(i) Failure to disclose financial information. However the Application Record contains nothing about this.
(ii) Failure to obtain an appraisal, as contemplated by the contract. The contract included an arbitration provision. There is no evidence before us that the Respondents (Plaintiffs) ever sought an arbitration. Consequently, there is no evidence of unconscionable conduct on the part of the Applicants (Defendants) on this basis.
(iii) Failure to deliver a promissory note, as contemplated by the contract. The contract specifically contemplated determination of the amount owing by means of appraisal or arbitration before delivery of the promissory note, or before an obligation to deliver a promissory note arose. Consequently, there is no evidence of unconscionable conduct on the part of the Appellants (Defendants) on this basis.
(iv) Failure to disclose the sale of the property. The possibility of sale is contemplated by the contract. The contract does not require advance notice of any sale to the Respondents (Plaintiffs).
5On the materials before the Motions Court Judge, the Respondents (Plaintiffs) have failed to provide any evidence of a factual basis to support a claim that the Appellants (Defendants) engaged in unconscionable conduct. Consequently, there is no triable issue in respect of whether the Appellants’ (Defendants’) unconscionable conduct may result in imposition on them of a remedial constructive trust, which gives rise to a reasonable claim to an interest in land.
6In addition, an equitable cause of action must be demonstrated to support the granting of an equitable remedy such as a remedial constructive trust. Here, counsel for the Respondents (Plaintiffs) conceded that his claim for a remedial constructive trust is intended to give effect to remedies for breach of the contract.
7The Respondents (Plaintiffs) therefore have failed to provide a factual basis upon which registration of the Certificate of Pending Litigation can be justified.
8This endorsement deals only with the evidence on the application before the Motions Court Judge. We do not determine any of the issues to be tried.
9I endorse the Record as follows: “This appeal is allowed for oral reasons delivered in Court. The Certificate of Pending Litigation is vacated. We award to the Appellants (Defendants) costs as follows, inclusive of fees, disbursements and GST, payable forthwith:
(i) of this appeal: $5,000.00
(ii) of the application for leave to appeal: $3,500.00, and
(iii) of the motion in Motions Court: $3,500.00.”
J. MACDONALD J.
DAMBROT J.
SANDERSON J.
Date of Reasons for Judgment: July 9, 2007 Date of Release: July 19, 2007
COURT FILE NO.: 08/07
DATE: 20070709
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
J. MACDONALD, DAMBROT AND SANDERSON JJ.
B E T W E E N:
IQBAL DEWJI and DEWSHAF INVESTMENTS INC.
Appellants
(Respondents)
- and -
ALNOOR GULAMANI and 1119713 ONTARIO INC.
Respondents
(Applicants)
ORAL REASONS FOR JUDGMENT
J. MACDONALD J.
Date of Reasons for Judgment: July 9, 2007 Date of Release: July 19, 2007