Court File and Parties

COURT OF APPEAL FOR ONTARIO DATE: 20210303 DOCKET: C68486

Fairburn A.C.J.O., Miller and Zarnett JJ.A.

BETWEEN

Debjani Banerjee Applicant (Respondent)

and

Julian Marshall Mathoo Respondent (Appellant)

Counsel: Orie Niedzviecki and Yousef Elsohemy, for the appellant Susan Sack and Andrea Acri, for the respondent

Heard: March 1, 2021 by video conference

On appeal from the order of Justice Erika Chozik of the Superior Court of Justice, dated March 13, 2020, with reasons at 2020 ONSC 1606.

Reasons for Decision

[1] The parties separated in 2011. The matrimonial home was sold in November 2017. While the respondent received her entire one-half interest in the matrimonial home, the appellant did not. A large portion of the appellant’s one-half interest in the matrimonial home was used to pay a debt, and the balance of $440,202.65 was then held in trust, pending determination of the parties’ financial issues.

[2] As the trial of those issues approached, the parties attended a Trial Management Conference on March 25, 2019 before Coats J., where they entered into a consent settlement agreement, requiring the respondent to pay the appellant $280,000 to equalize their net family property. The order reflected that it disposed of “all property issues between the parties.” The balance of all outstanding issues was to be determined at trial.

[3] The parties attended another Trial Management Conference before Coats J. on March 29, 2019. The respondent made an offer to settle, agreeing to accept $255,000 as a full and final settlement of all outstanding issues. According to the affidavit of the respondent’s counsel at the Trial Management Conference, counsel for the respondent told counsel for the appellant that the offer was made “[i]n full and final satisfaction of all claims, including the husband’s equalization claim and the wife’s support arrears claim”. This position is supported by a document exchanged on that day, entitled “Balance Owing Calculation”, including the hand-written notations contained on that document.

[4] While those negotiations failed in the context of the Trial Management Conference, the respondent reiterated the offer in a written Offer to Settle, dated April 1, 2019. The offer was “to settle all outstanding issues in these proceedings”. The offer specifically addressed the remaining amount of money held in trust as a result of the sale of the matrimonial home and how it was to be divided: (a) $255,000 to the respondent; and (b) $185,202.65 to the appellant. The respondent signed and accepted the offer. The offer was signed back as approved by the appellant on April 2, 2019. A court order including the terms of the accepted Offer to Settle was issued on April 5, 2019. The funds were disbursed accordingly.

[5] Within a few weeks, the appellant inquired about what arrangements had been made regarding the payout of the $280,000 equalization payment, and he commenced garnishment proceedings. Surprised by this inquiry, the respondent brought a motion to amend the two prior court orders so that it was clear that the final order dated April 5, 2019 was intended “to settle all outstanding issues in these proceedings”, including the equalization payment. In other words, the respondent sought an amendment that would make it clear that the equalization payment was accounted for in the final agreement reached by the parties.

[6] The motion was granted. The motion judge concluded that there was no further amount owed by the respondent to the appellant, as it was clear that the parties and the court intended that the equalization amount be offset by the other amounts that were owed by the appellant to the respondent. The motion judge found that it was clearly implied that the April 5, 2019 order subsumed the equalization payment that had been reflected in the March 25, 2019 order. Ultimately, both orders were amended to make it clear that the payments from the funds held in trust were in full and final satisfaction of all outstanding matters, including the equalization payment.

[7] The appellant argues that the motion judge made two errors: (a) an error of law by improperly applying the officious bystander test; and (b) an error of fact by reading the March 25, 2019 order into the April 5, 2019 order. We do not agree.

[8] As acknowledged by the parties on appeal, the motion judge correctly stated the officious bystander test: see Canadian Pacific Hotels Ltd. v. Bank of Montreal, [1987] 1 S.C.R. 711, at p. 775; M.J.B. Enterprises Ltd. v. Defence Construction (1951) Ltd., [1999] 1 S.C.R. 619, at para. 27. The question is whether she applied it correctly. In our view, she did.

[9] Having reviewed the entire record, the motion judge concluded that the parties and court clearly understood and intended that the $280,000 amount owing under the March 25, 2019 order would be offset by the amounts the appellant owed to the respondent.

[10] We have little to add to what the motion judge said on this point. Read as a whole, the record clearly demonstrates the intention of the parties when the Offer to Settle was signed and the April 5, 2019 order was issued. To make this point, one need only look to common sense. There was $440,202.65 sitting in trust from the sale of the matrimonial home. If the appellant had thought that he was owed another $280,000, above the $185,202.65 agreed to under the Offer to Settle, it makes no sense that he would have agreed to release $255,000 to the respondent from the funds held in trust. Rather, that amount would have been set off against the debt he says that he was still owed, leaving the respondent with an additional $25,000 to pay the appellant on top of the $440,202.65.

[11] Common sense dictates that the parties knew that the Offer to Settle was an offer “to settle all outstanding issues” – the terminology used in the offer itself – and that the $280,000 equalization payment was built into the resolution. Beyond common sense, we accept the motion judge’s other stated reasons for why this was so.

Disposition

[12] The appeal is dismissed.

[13] The parties are encouraged to agree upon costs. If they cannot do so, we will take written costs submissions of no more than three pages in length. The respondent will provide submissions no later than 10:00 a.m. on March 4, 2021. The appellant will provide submissions no later 10:00 a.m. on March 5, 2021.

“Fairburn A.C.J.O.”

“B. W. Miller J.A.”

“B. Zarnett J.A.”