Court File and Parties

COURT OF APPEAL FOR ONTARIO

DATE: 20231207 DOCKET: COA-22-CV-0482

Rouleau, Benotto and Copeland JJ.A.

BETWEEN

Veeru Kantoor Plaintiff (Appellant)

and

Anthony Comparone and Joanne Comparone Defendants (Respondents)

AND BETWEEN

Anthony Comparone and Joanne Comparone Plaintiffs by Counterclaim (Respondents)

and

Vivek Handa (aka Vick Handa) in his capacity as Trustee for the Estate of Sarika Handa*, Vick Handa*, Dennis Khanna (aka Dinesh Khanna)* Veeru Khanna (aka Veeru Kantoor)*, Metro Financial Planning Ltd.* and Ross McLeod Defendants by Counterclaim (Appellants*)

Counsel: Pathik Baxi, for the appellants Michael Lesage, for the respondents

Heard: November 27, 2023

On appeal from the order and judgment of Justice James A. Ramsay of the Superior Court of Justice, dated November 22, 2022, and December 1, 2022.

Reasons for Decision

[1] The appellant, Dennis Khanna, was a mortgage broker. In 2007, Dennis and his company, Metro Financial Planning Ltd., arranged refinancing of the respondents’ home. [^1] They arranged for one mortgage with a third party and a second mortgage with Veeru Khanna, Dennis’s wife (the “Second Mortgage”). Veeru later transferred the Second Mortgage to Sarika Handa, now deceased. Vick Handa, who is Sarika’s husband and Veeru’s nephew, is the trustee of Sarika’s estate. Vick eventually transferred the Second Mortgage back to Veeru. Vick is also the mortgagee on a third mortgage for the respondents.

[2] The Second Mortgage is the subject of this appeal.

[3] In 2010, the respondents defaulted on payments with respect to the Second Mortgage, and Veeru obtained default judgment. Also in 2010, the respondents needed more funds and the appellants arranged for an additional mortgage. In 2012, Veeru brought the underlying action to recover further amounts owing on the Second Mortgage. The respondents counterclaimed. This would not reach trial until 2022.

[4] Meanwhile, in 2017, the Financial Services Tribunal (the “FST”) issued a decision denying Dennis’s application for a new mortgage broker’s licence and revoking his company’s mortgage brokerage licence: Metro Financial Planning Limited and Dinesh Khanna v. Ontario (Superintendent Financial Services), 2017 ONFST 4 (the “FST Decision”). As set out in the FST Decision, the allegations were that:

Mr. Khanna engaged in past conduct that affords reasonable grounds for the belief that he will not trade or deal in mortgages in accordance with the law and with honesty and integrity; and that Mr. Khanna provided false information to the Superintendent with respect to his most recent application for a mortgage broker licence.

[5] Following a nine-day hearing, the FST determined that the allegations had been established.

[6] Dennis did not testify at the hearing. The respondent, Joanne Comparone, did. She filed an affidavit and was cross-examined extensively about her interactions with Dennis. As articulated in its 62-page decision, the FST concluded that Dennis and Metro Financial Planning Ltd.’s business model was essentially illegal.

[7] The action against the respondents came for trial in 2022. At the outset of trial, the trial judge – relying in part on the FST findings – struck out the default judgment and the statement of claim as an abuse of process. He then conducted the trial on the counterclaim. The trial judge accepted the evidence of Joanne and determined that the respondents had overpaid on the Second Mortgage by $41,494. The trial judge awarded the respondents damages of $41,494 plus $5,000 for slander for a total of $46,494.

[8] The appellants submit that the trial judge erred (i) by striking out the default judgment because the delay was not explained; (ii) by granting the respondents’ motion to strike the appellants’ statement of claim as an abuse of process; (iii) by finding that Joanne was credible and Dennis was not; and (iv) by creating a reasonable apprehension of bias.

[9] In our view the appeal must be dismissed.

[10] As admitted by the appellants before us, if we accept the trial judge’s findings that Dennis’ “brokering and administration of the mortgages was essentially corrupt” and that $41,494 said to be owing on the mortgage were the result of fraud by Dennis and his company, the first two issues become moot. The claims against the respondents were for amounts that were found not to be owing. In any event, the trial judge found that the delay in moving to strike the default judgment was explained because the respondents were overwhelmed at the prospect of losing their home, they were going through difficult times, and they were “consumers, unrepresented, with little in the way of resources to defend an action.” This evidence was uncontradicted. It was open to the trial judge to make those findings on the record.

[11] The trial judge explained his credibility findings in reference to the evidence before him. His findings are entitled to deference.

[12] The appellants’ submission with respect to bias relates to an earlier case against Dennis, which was heard by the trial judge. At the opening of the case, the following exchange took place:

THE COURT: I understand that nobody objects to me hearing this case in spite of my last – my previous dealings with Mr. Khanna?

MR. GLIGORIC: That’s correct, Your Honour.

[13] Mr. Gligoric was counsel for the appellants.

[14] The appellants now address this issue by submitting that the allegation of bias is based on the trial judge’s findings, not on his conduct.

[15] The long-standing test for reasonable apprehension of bias was set out by the Supreme Court of Canada in R. v. S. (R.D.), [1997] 3 S.C.R. 484, at para. 31, citing Grandpré J. (dissenting) in Committee for Justice and Liberty v. National Energy Board, [1978] 1 S.C.R. 369, at p. 394, as:

What would an informed person, viewing the matter realistically and practically — and having thought the matter through — conclude. Would he think that it is more likely than not that [the decision-maker], whether consciously or unconsciously, would not decide fairly.

[16] The apprehension of bias must be reasonable in the circumstances of the case, and the person considering the alleged bias must be reasonable and informed: S. (R.D.), at para. 111, per Cory J.

[17] There is a presumption of judicial impartiality and a high burden on the person alleging bias. In Yukon Francophone School Board v. Yukon (Attorney General), 2015 SCC 25, [2015] 2 S.C.R. 282, at paras. 25-26, the Supreme Court confirmed:

Because there is a strong presumption of judicial impartiality that is not easily displaced, the test for a reasonable apprehension of bias requires a “real likelihood or probability of bias” and that a judge’s individual comments during a trial not be seen in isolation.

The inquiry into whether a decision-maker’s conduct creates a reasonable apprehension of bias, as a result, is inherently contextual and fact-specific, and there is a correspondingly high burden of proving the claim on the party alleging bias. [Citations omitted.]

[18] The appellants are essentially alleging bias because they lost the trial. There is nothing in the conduct of the trial judge or in his reasons that discloses bias.

[19] The appeal is dismissed with costs to the respondents in the agreed upon amount of $15,000 inclusive of disbursements and applicable taxes.

“Paul Rouleau J.A.”

“M.L. Benotto J.A.”

“J. Copeland J.A.”

[^1]: For ease of reference, we refer to the parties using their first names.