Case Summary

The defendant Lisa Gatto moved to discharge a certificate of pending litigation (CPL) against her property, the Dickson Park Property, which was issued ex parte at the plaintiffs' request. The plaintiffs, creditors of Ms. Gatto's husband, Sergio Grillone, alleged a constructive trust and equitable tracing of loan monies into the property. The court found that the plaintiffs failed to establish a triable issue of a reasonable claim to an interest in the property, as the connection between the loan monies and the property was too remote and based on speculation rather than direct evidence. The court granted Ms. Gatto's motion to discharge the CPL unconditionally, declining to impose the plaintiffs' proposed conditions. interesting_citations_summary: > This decision clarifies the evidentiary threshold for maintaining a certificate of pending litigation based on a constructive trust claim, particularly when the connection between the alleged misappropriated funds and the property is indirect or speculative. It reiterates that while the bar for a "triable issue" is low, mere allegations and beliefs, even with some discrepancies in the opposing party's evidence, are insufficient without a more direct link or evidence of misconduct by the property owner. The court distinguished this case from others where a direct connection or misconduct was present, emphasizing the need for a substantive basis beyond inferences to ground a claim for constructive trust and equitable tracing in land. final_judgement: > The motion by Lisa Gatto for the discharge of the Certificate of Pending Litigation (CPL) against the Dickson Park Property was granted unconditionally. The court ordered the CPL to be discharged and vacated from the property's title. No costs were awarded to any party. winning_degree_applicant: 1 winning_degree_respondent: 5 judge_bias_applicant: 0 judge_bias_respondent: 0 year: 2020 decision_number: 4140 file_number: "CV-19-627474" source: "https://www.canlii.org/en/on/onsc/doc/2020/2020onsc4140/2020onsc4140.html" cited_cases: legislation: - title: "Courts of Justice Act, R.S.O. 1990, c. C.43" url: "https://www.ontario.ca/laws/statute/90c43" - title: "Rules of Civil Procedure, R.R.O. 1990, Reg. 194" url: "https://www.ontario.ca/laws/regulation/900194" - title: "Family Law Act, R.S.O. 1990, c. F.3" url: "https://www.ontario.ca/laws/statute/90f03" case_law: - title: "Royal Bank v. 1514357 Ontario Ltd., 2011 ONSC 5288" url: "https://www.canlii.org/en/on/onsc/doc/2011/2011onsc5288/2011onsc5288.html" - title: "Perruzza v. Spatone, 2010 ONSC 841" url: "https://www.canlii.org/en/on/onsc/doc/2010/2010onsc841/2010onsc841.html" - title: "Homebuilder Inc. v. Man-Sonic Industries Inc., 1987 CarswellOnt 499 (S.C. – Mast.)" - title: "1152939 Ontario Ltd. v. 2055835 Ontario Ltd., 2007 CarswellOnt 756 (S.C.J.)" - title: "Transmaris Farms Ltd. v. Sieber, [1999] O.J. No. 300" url: "https://www.canlii.org/en/on/onsc/doc/1999/1999canlii14900/1999canlii14900.html" - title: "G.P.I. Greenfield Pioneer Inc. v. Moore" url: "https://www.canlii.org/en/on/onca/doc/2002/2002canlii6832/2002canlii6832.html" - title: "572383 Ontario Inc. v. Dhunna, 1987 CarswellOnt 551 (S.C. – Mast.)" - title: "931473 Ontario Ltd. v. Coldwell Banker Canada Inc., 1991 CarswellOnt 460 (Gen. Div.)" - title: "Clock Investments Ltd. v. Hardwood Estates Ltd." url: "https://www.canlii.org/en/on/onsc/doc/1977/1977canlii1414/1977canlii1414.html" - title: "Bridge v. Laurence, 2016 ONSC 5075" url: "https://www.canlii.org/en/on/onsc/doc/2016/2016onsc5075/2016onsc5075.html" - title: "Remus v. Remus" url: "https://www.canlii.org/en/on/onsc/doc/2008/2008canlii22141/2008canlii22141.html" - title: "Wang v. The Wawanesa Mutual Insurance Company, 2019 ONSC 4271" url: "https://www.canlii.org/en/on/onsc/doc/2019/2019onsc4271/2019onsc4271.html" - title: "Gibb v. Pereira, 2017 ONSC 4762" url: "https://www.canlii.org/en/on/onsc/doc/2017/2017onsc4762/2017onsc4762.html" - title: "Mansfield v. Ottawa, 2012 ONSC 5208" url: "https://www.canlii.org/en/on/onsc/doc/2012/2012onsc5208/2012onsc5208.html" - title: "Albaroudi v. Tarakji, 2013 ONSC 1204" url: "https://www.canlii.org/en/on/onsc/doc/2013/2013onsc1204/2013onsc1204.html" - title: "Vettese v. Fleming, [1992] O.J. No. 1013" url: "https://www.canlii.org/en/on/onsc/doc/1992/1992canlii7600/1992canlii7600.html" - title: "Procopio v. D'Abbondanza (1969)" url: "https://www.canlii.org/en/on/onca/doc/1969/1969canlii291/1969canlii291.html" - title: "Mohammed v. Karigar" url: "https://www.canlii.org/en/on/onsc/doc/2006/2006canlii24340/2006canlii24340.html" - title: "Century Services Inc. v. New World Engineering Corp" url: "https://www.canlii.org/en/on/onsc/doc/2009/2009canlii44410/2009canlii44410.html" - title: "HarbourEdge Mortgage Investment Corporation v. Community Trust Company, 2016 ONSC 448" url: "https://www.canlii.org/en/on/onsc/doc/2016/2016onsc448/2016onsc448.html" - title: "Huntjens v. Obradovic, 2019 ONSC 4343" url: "https://www.canlii.org/en/on/onsc/doc/2019/2019onsc4343/2019onsc4343.html" - title: "B.M.P. Global Distribution Inc. v. Bank of Nova Scotia, 2009 SCC 15, [2009] 1 SCR 504" url: "https://www.canlii.org/en/ca/scc/doc/2009/2009scc15/2009scc15.html" - title: "Soulos v. Korkontzilas, [1997] 2 S.C.R. 217" url: "https://www.canlii.org/en/ca/scc/doc/1997/1997canlii346/1997canlii346.html" - title: "Boal v. International Capital Management Inc., 2018 ONSC 2275" url: "https://www.canlii.org/en/on/onsc/doc/2018/2018onsc2275/2018onsc2275.html" - title: "Millar v. Millar (1991), 1991 ABCA 261" url: "https://www.canlii.org/en/ab/abca/doc/1991/1991abca261/1991abca261.html" - title: "Maroukis v. Maroukis (1981)" url: "https://www.canlii.org/en/on/onca/doc/1981/1981canlii77/1981canlii77.html" - title: "Maroukis v. Maroukis" url: "https://www.canlii.org/en/ca/scc/doc/1984/1984canlii76/1984canlii76.html" - title: "Thibodeau v. Thibodeau, 2011 ONCA 110" url: "https://www.canlii.org/en/on/onca/doc/2011/2011onca110/2011onca110.html" keywords: - Certificate of Pending Litigation - CPL - Constructive Trust - Equitable Tracing - Mareva Injunction - Fraudulent Conveyance - Matrimonial Home - Rules of Civil Procedure - Courts of Justice Act - Evidentiary Threshold - Spousal Property areas_of_law: - Civil Procedure - Property Law - Family Law - Equity --- # Court File and Parties **COURT FILE NO.:** CV-19-627474 **DATE:** 20200703 **ONTARIO** **SUPERIOR COURT OF JUSTICE** **BETWEEN:** MANDEEP SAGGI, NEELAM SAGGI, SUCHA SAGGI Plaintiffs – and – SERGIO GRILLONE, GRILLONE LAW FIRM, GRILLONE BEKIARIS LLP, GEORGE BEKIARIS, 1894931 ONTARIO LIMITED, LISA ROBERTA GATTO Defendants **Counsel:** Allan Rouben, for the Plaintiffs Jillian Van Allen, for the Defendants Sergio Grillone and the Grillone Law Firm William Gilmour, for the Defendant Lisa Roberta Gatto The defendant 1894931 Ontario Limited having been noted in default Sergio Grillone appearing as an observer and as a representative of one of the 50% shareholders of 1894931 Ontario Limited, (2390215 Ontario Inc.) Batista Frino appearing as an observer for Rhondaroo Holdings Ltd., 50% shareholder of 1894931 Ontario Limited (plaintiff in Action No. CV-20-638052-00CL) No one appearing for the other defendants Zack Pringle and Amanda Bafaro, appearing as observers for other interested creditors (Mr. Pringle for plaintiffs in Action No. CV-19-627782 and Ms. Bafaro for Bridgepoint Financial Services) **HEARD:** June 26, 2020 KIMMEL J. reasons for decision (Lisa Gatto motion for discharge of CPL) ## Procedural History and Overview of this Urgent Motion [1] The defendant Sergio Grillone is a lawyer who was practicing law through the Grillone Law Firm and/or Grillone Berkiakis LLP. Mr. Grillone ceased the practice of law and ceased carrying on the business of his law firm in May 2019. Mr. Grillone was experiencing financial difficulties and health issues leading up to that. The specific circumstances of the cessation of his law practice are not directly relevant to the issues on this motion. The plaintiffs are some among various creditors seeking to recover debts owing by Mr. Grillone and/or the law firms through which he practiced. [2] The defendant Lisa Gatto is Mr. Grillone’s wife. On this motion, she asks the court to discharge a certificate of pending litigation that was issued by order of Master Graham dated September 30, 2019 (the “CPL”) as against the lands and premises owned by her at 140 Dickson Park Crescent, Mississauga Ontario (the “Dickson Park Property”). The Dickson Park Property is the home of Ms. Gatto, Mr. Grillone and their children. [3] Ms. Gatto entered into an agreement of purchase and sale dated April 9, 2020 (the “APS”) for the sale of the Dickson Park Property that is scheduled to close on July 8, 2020. This motion was scheduled for an urgent hearing by my order and directions of June 4, 2020 because of that impending closing. [4] The CPL also attaches to another property at 5155 Spectrum Way, Unit 8, Mississauga Ontario (the “Spectrum Way Property”), owned by the defendant 1894931 Ontario Limited (“189”). The Spectrum Way Property was the premises out of which Mr. Grillone carried on his law practice. [5] Ms. Gatto entered into a listing agreement to sell the Dickson Park Property in the late summer or fall of 2019. The CPL was issued ex parte at the request of the plaintiffs at the same time that leave was sought and granted to add Ms. Gatto as a defendant to this action. Master Graham’s short handwritten endorsement of September 30, 2019 reads as follows: To be granted the order sought, the plaintiffs need demonstrate that they have a reasonable claim to an interest in the two subject properties, not that the claims are likely to succeed. Where reasonable claims are put forward in an action for constructive trust (as in this case), a CPL may be issued pending a trial. (See Royal Bank v. 1514357 Ontario Ltd., 2011 CarswellOnt 9279 (Ont. S.C.J.) at para. 41). In this case, I am satisfied based on the pleadings in paragraphs 1(a) and (g), 3, 4, 16A and 21 of the statement of claim that the plaintiffs have advanced a reasonable claim to an interest in land. Further, based on the evidence that the property at 140 Dickson Park Crescent, Mississauga, owned by the proposed added defendant Gatto, was listed for sale the day after the original statement of claim was served, I am satisfied that the court should exercise its discretion to grant the order sought ex parte. [6] After the CPL was granted, on October 23, 2019, the plaintiffs brought a motion for a Mareva injunction and related relief that was originally returnable on November 28, 2019 but was adjourned and eventually heard by me on January 14, 2020. While my decision was under reserve, the plaintiffs brought a further motion for leave to file fresh evidence which was scheduled to be heard on April 16, 2020 but was suspended pursuant to the Notice to the Profession as a result of the COVID-19 pandemic. Although the landscape of fresh evidence sought to be relied upon by the plaintiffs may have changed, they do still wish to pursue that motion and ask me to continue to reserve my decision on their requested Mareva injunction pending their fresh evidence motion. I will come back to this at the end of my reasons herein. [7] Ms. Gatto has entered into an agreement to purchase a new home on 2362 Delkus Crescent, Mississauga, Ontario (the “New Property”). Ms. Gatto deposes that she requires the net sale proceeds from the Dickson Park Property to purchase this New Property. She further deposes that her equity in the Dickson Park Property will remain in this New Property that will be titled to her as the sole registered owner. [8] The plaintiffs do not object to the CPL being lifted to permit the sale of the Dickson Park Property, on the conditions that a CPL be issued as against the New Property once Ms. Gatto’s purchase closes and that the court order any net sale proceeds from the Dickson Park Property that are not applied towards the purchase of the New Property be paid into court (the “Proposed Conditions”). [9] Ms. Gatto contends that the CPL should be discharged unconditionally because the pleading against her does not claim an interest in land, the alleged constructive trust is not of a nature or character to support a claim to an interest in the Dickson Park Property, and the admissible evidence before the court now and that was before the court on the ex parte motion for the CPL does not establish a claim to an interest in land. [10] The immediate issue before me to decide is whether to order that the CPL be lifted as against the Dickson Park Property with, or without, the Proposed Conditions. For the reasons that follow, I order that the CPL be lifted as against the Dickson Park Property, without the Proposed Conditions. ## The Uncontroverted Facts [11] The facts outlined in this section are derived from the evidence of Ms. Gatto that was either elicited on cross-examination or was not contradicted or challenged on cross-examination. [12] The Dickson Park Property was purchased prior to any advances of loan monies by the plaintiffs to Mr. Grillone. Ms. Gatto has been the registered owner of that property since the time it was purchased. She was also the registered owner of the previous family home, the net sale proceeds of which were used to fund the down payment for the purchase of the Dickson Park Property. [^1] [13] Ms. Gatto guaranteed certain indebtedness of Mr. Grillone and his law firm to the Bank of Nova Scotia, in consideration for which Mr. Grillone released any claims under the Family Law Act or at common law to the matrimonial home (the Dickson Park Property) and has declared that he has no titular, proprietary or equitable interests in that property. [14] Ms. Gatto says that she does not hold any interest in the Dickson Park Property (or any other property) in trust for Mr. Grillone. [15] Ms. Gatto is not a party to the loan agreement that forms the basis of the plaintiffs’ claims in this action. She was never asked for, and did not provide, a personal guarantee of the plaintiffs’ loans to her husband and his law practice. Nor was any mortgage over the Dickson Park Property requested as security for the plaintiffs’ loans (until after the alleged defaults at which time it was refused). [16] Ms. Gatto was employed from time to time as a bookkeeper and a member of the office staff of the Grillone law practice. In that capacity, she may have received an indirect benefit of the plaintiffs’ loans to Mr. Grillone’s law practice through the fair market wages that she was paid from the general account of the law firm as a part-time employee. [17] Ms. Gatto was not a partner in Mr. Grillone’s law practice, and she had no authority or control over its business or affairs. Although she had a spousal power of attorney over Mr. Grillone’s property, she never acted on it. She had no knowledge of or involvement in the loans or transactions that her husband engaged in with the plaintiffs. ## Disputed Facts and Evidentiary Gaps [18] Mr. Mandeep Saggi deposes that it appears to him that the funds loaned by the plaintiffs were used to fund Mr. Grillone and Ms. Gatto’s lifestyle, and to pay mortgage, tax or improvements on the Dickson Park Property and the Spectrum Way Property. [19] The plaintiffs claim damages in paragraph 1 of their Amended Statement of Claim (the “Amended Claim”) not only for the principal and interest under their loan agreements, but also for conversion, knowing receipt and unjust enrichment. They seek an accounting of all funds, assets and property received by the defendants from and to the detriment of the plaintiffs and a tracing order. They also seek an order or declaration that the plaintiffs possess equitable interests by way of a constructive or resulting trust over any real or personal property into which their loan monies can be traced, including the Dickson Park Property and the Spectrum Way Property and an order for equitable tracing of the loan monies into the assets, property and interests of the defendants. [20] In support of these claims, the plaintiffs allege that: a. Ms. Gatto was aware of the plaintiffs’ loans and that the loaned monies were being used to make mortgage, tax, improvements and other payments on the Dickson Park Property and that she received and benefited from the loaned monies. [Amended Claim, para. 3A] b. That Ms. Gatto listed the Dickson Park Property for sale immediately after Mr. Grillone was served with the original statement of claim in this matter and that a sale would be a fraudulent conveyance intended to put the proceeds of sale out of the reach of creditors such as the plaintiffs and to defeat, hinder or delay their claims. [Amended Claim, para. 3A] c. That the monies loaned by the plaintiffs were used to fund Mr. Grillone’s law practice overhead (including employee salaries) and his lifestyle. [Amended Claim, para. 16] d. That Ms. Gatto received benefits from the monies loaned by the Plaintiffs when she knew or ought to have known of the alleged wrongful actions of Mr. Grillone in relation to the intended use of those funds. The funds so received are alleged to have been fraudulent conveyances and to have unjustly enriched Ms. Gatto, as a result of which she is alleged to hold them in trust, and the plaintiffs claim a constructive and resulting trust over her assets, property and interests and seek an equitable tracing of the monies loaned and benefits she received. [Amended Claim, para. 16A] [21] In response to the plaintiffs’ motion for a Mareva injunction and in support of Ms. Gatto’s request for the discharge of the CPL, Ms. Gatto and Mr. Grillone both deposed that: The mortgage obligations with respect to our Matrimonial Home have been exclusively paid from [Ms. Gatto’s] wages and personal funds and the down payment therefore was funded by the sale of a previous home by [her]. [22] It was established on cross-examination that Ms. Gatto’s wages would not have been sufficient to cover the monthly mortgage payments (and therefore could not cover the annual property taxes). No further explanation was proffered as to the source of funds to pay for the capital and carrying costs of the Dickson Park Property. [23] Although Ms. Gatto testified when cross-examined that monies earned by Mr. Grillone from his law practice were not deposited into their joint bank account, the bank statements that have been produced disclose mobile deposits originating from him into that account of close to $40,000.00 between June 2018 and June 2019. [24] Ms. Gatto testified on cross-examination that $12,000.00 in improvements were made to the Dickson Park Property in December 2018. However, answers to undertakings disclosed afterwards that she had told a real estate agent in July 2019 that there had been $550,000.00 in renovations made to the Dickson Park Property. [25] The plaintiffs’ requests for production of Ms. Gatto’s, Mr. Grillone’s and the law firm’s banking records have been refused in the context of requests made on the pending motions. [26] Ms. Gatto has not produced the discharge statements for the Dickson Park Property or the mortgage information for the New Property, so the net equity cannot be calculated, and it is not known whether all of it is being used to fund the purchase of the New Property. ## Issues and Analysis [27] The issues to be decided on this motion are as follows: a. Does the record disclose a sufficient basis for granting and/or maintaining the CPL against the Dickson Road Property? i. What is the test for the issuance of a CPL? ii. Were there deficiencies in the evidentiary record upon which the grant of the CPL was based? iii. Did the record disclose a triable issue with respect to the plaintiffs’ claimed interest in the Dickson Park Property? b. Should the CPL be discharged and, if so, on what terms, if any? ### The Grant of the CPL Against the Dickson Park Property [28] Section 103(1) of the [Courts of Justice Act, R.S.O. 1990, c. C.43](https://www.ontario.ca/laws/statute/90c43) establishes the court’s jurisdiction to issue a certificate of pending litigation. First, the court must be satisfied that a triable issue has been raised as to whether the party registering the certificate of pending litigation has a reasonable claim and then the court may go on to consider the equities between the parties. That was what Master Graham decided in his September 30, 2019 endorsement. #### The Test for Granting a CPL [29] This court described the test for granting a certificate of pending litigation (which also covers the test for discharging a certification of pending litigation) in [Perruzza v. Spatone, 2010 ONSC 841](https://www.canlii.org/en/on/onsc/doc/2010/2010onsc841/2010onsc841.html), at para. 20 as follows: (i) The test on a motion for leave to issue a CPL made on notice to the defendants is the same as the test on a motion to discharge a CPL (Homebuilder Inc. v. Man-Sonic Industries Inc., 1987 CarswellOnt 499 (S.C. – Mast.) (“Homebuilder”) at para. 1); (ii) The threshold in respect of the “interest in land” issue in a motion respecting a CPL (as that factor is set out at section 103(6) of the [Courts of Justice Act, R.S.O. 1990, c. C.43](https://www.ontario.ca/laws/statute/90c43)) is whether there is a triable issue as to such interest, not whether the plaintiff will likely succeed (1152939 Ontario Ltd. v. 2055835 Ontario Ltd., 2007 CarswellOnt 756 (S.C.J.), as per van Rensburg J., citing Transmaris Farms Ltd. v. Sieber, [1999] O.J. No. 300 (Gen. Div. – Comm. List) at para. 62); (iii) The onus is on the party opposing the CPL to demonstrate that there is no triable issue in respect to whether the party seeking the CPL has “a reasonable claim to the interest in the land claimed” ([G.P.I. Greenfield Pioneer Inc. v. Moore](https://www.canlii.org/en/on/onca/doc/2002/2002canlii6832/2002canlii6832.html), 2002 CarswellOnt 219 (C.A.) at para. 20); (iv) Factors the court can consider on a motion to discharge a CPL include (i) whether the plaintiff is a shell corporation, (ii) whether the land is unique, (iii) the intent of the parties in acquiring the land, (iv) whether there is an alternative claim for damages, (v) the ease or difficulty in calculating damages, (vi) whether damages would be a satisfactory remedy, (vii) the presence or absence of a willing purchaser, and (viii) the harm to each party if the CPL is or is not removed with or without security (572383 Ontario Inc. v. Dhunna, 1987 CarswellOnt 551 (S.C. – Mast.) at paras. 10-18); and (v) The governing test is that the court must exercise its discretion in equity and look at all relevant matters between the parties in determining whether a CPL should be granted or vacated (931473 Ontario Ltd. v. Coldwell Banker Canada Inc., 1991 CarswellOnt 460 (Gen. Div.); [Clock Investments Ltd. v. Hardwood Estates Ltd.](https://www.canlii.org/en/on/onsc/doc/1977/1977canlii1414/1977canlii1414.html), 1977 CarswellOnt 1026 (Div. Ct.) at para. 9). [30] The CPL was granted on an ex parte motion. The plaintiffs had the onus to establish that the requirements were met and they had a duty to make full disclosure. [31] The question that has been raised is: Have the plaintiffs advanced claims that raise a triable issue about whether they have an interest in the Dickson Park Property to support the issuance and maintenance of the CPL? [32] Master Graham was satisfied of this on the ex parte motion based on the allegations of a constructive trust and equitable tracing contained in the Amended Claim. His endorsement reads, in part: In this case, I am satisfied based on the pleadings in paragraphs 1(a) and (g), 3, 4, 16A and 21 of the statement of claim that the plaintiffs have advanced a reasonable claim to an interest in land. [33] The moving defendant argues that, with the benefit now of the “other side”, the court must examine these allegations to determine whether the underlying record supports the pleas of constructive trust and equitable tracing. The moving defendant asks the court to look more closely at the sufficiency of the allegations underlying these pleas in assessing whether the plaintiffs have advanced claims that raise a triable issue about whether they have an interest in the Dickson Park Property to support the issuance and maintenance of the CPL. #### The Alleged Deficiencies in the Evidentiary Record [34] The moving defendant argues that there were deficiencies in the manner in which the supporting affidavit of Mandeep Saggi was sworn on the original motion that granted the CPL. These alleged deficiencies were carried forward in Mr. Saggi’s subsequent affidavit filed on the Mareva injunction motion which the plaintiffs also rely on in response to this motion. Therefore, the moving defendant argues, this motion to discharge the CPL should be decided without regard to any of the exhibits or any of the evidence of Mr. Saggi tied to those exhibits. The remaining deficiency is said to be the failure of the notary who commissioned the supporting affidavit to also identify and apply his stamp to the exhibits. [^2] Counsel argues that this leaves the court with essentially no evidence properly before the court to support the granting of the CPL. [35] The moving defendant contends that in order to rely on the exhibits appended to Mr. Saggi’s affidavit and his testimony about those exhibits, they must be properly incorporated, referenced and marked in conformance with the [Rules of Civil Procedure](https://www.ontario.ca/laws/regulation/900194) (specifically, Rule 4.06) so that the court can be satisfied that the exhibits were in fact attached to and/or shown to the affiant at the time that the affidavit was sworn. See [Bridge v. Laurence, 2016 ONSC 5075 at para. 34](/on/scj/2016/5075), [Remus v. Remus at para. 31](https://www.canlii.org/en/on/onsc/doc/2008/2008canlii22141/2008canlii22141.html), [Wang v. The Wawanesa Mutual Insurance Company, 2019 ONSC 4271 at para. 2 (d)](/on/scj/2019/4271). [36] I accept these authorities for what they stand for. However, the underlying concerns about the sufficiency or proper identification of the exhibits in those cases do not arise in this case for a variety of reasons, such as: a. Although Rule 4.06 states that an exhibit referred to is to be marked by the person taking the affidavit, it does not specifically require that the notary/commissioner apply their stamp to the exhibit itself. Each of the exhibits to Mr. Saggi’s affidavit is described in the body of the affidavit as having been attached at a specified lettered exhibit and has a handwritten exhibit identification, by letter, at the top of the first page. I was not advised of any evidence, one way or the other in this case, about whose handwriting this is. b. Although counsel for the moving defendant insists that this is not an argument of form over substance because the evidence was simply not before the court, there is no suggestion that the deficient exhibits are forgeries, that they did not exist or that the affiant was not familiar with them at the time he swore the affidavit, and many of them relate to matters that the affiant was directly involved in. [37] Furthermore, even if the exhibits appended to the affidavit were disregarded, as the moving defendant argues they should be: a. Many of the allegedly deficient exhibits are now in evidence before the court on this motion because they are attached to other affidavits or were referred to during the cross-examinations. b. The allegations and evidence upon which the CPL was granted and upon which the plaintiffs seek to maintain it do not depend on any of these exhibits or testimony contained in the affidavits describing them. [38] I am not going to decide this motion on the basis that the exhibits appended to Mr. Saggi’s affidavit must be disregarded because they were not properly marked with the notary’s/commissioner’s stamp. This is ultimately a matter for the court’s discretion. See [Gibb v. Pereira, 2017 ONSC 4762, para. 28](https://www.canlii.org/en/on/onsc/doc/2017/2017onsc4762/2017onsc4762.html), [Mansfield v. Ottawa, 2012 ONSC 5208, at para. 52](https://www.canlii.org/en/on/onsc/doc/2012/2012onsc5208/2012onsc5208.html) and Rules 1.04 and 2.01. Nor would disregarding them change the outcome of this motion. #### Did the Record Disclose a Triable Issue About the Plaintiffs’ Claimed Interest in the Dickson Park Property? [39] The grant of the CPL was dependent, according to the endorsement of Master Graham, on the allegations of a constructive trust and equitable tracing of the loaned monies into the Dickson Park Property and the Spectrum Way Property. Master Graham’s endorsement identifies the pleas in the Amended Claim as the basis for his finding that the plaintiffs had advanced a reasonable (triable) claim to an interest in these lands. [40] The allegations in the Amended Claim go further, to allege that the funds loaned were used to pay employee salaries (Ms. Gatto was an employee) and that Ms. Gatto received benefits from the monies loaned by the Plaintiffs when she knew or ought to have known of the alleged wrongful actions of Mr. Grillone in relation to the intended use of those funds. All of these allegations are said to ground the claims for constructive trust, unjust enrichment, and equitable tracing and disgorgement. [41] Mr. Mandeep Saggi’s supporting affidavit includes statements of his beliefs that: a. it appeared to him that the funds loaned by the plaintiffs were used to fund Mr. Grillone and Ms. Gatto’s lifestyle, and to pay mortgage, tax or improvements on the Dickson Park Property and on the Spectrum Way Property. b. when he had attended at the law firm with loan cheques and to pick up interest payments, Ms. Gatto was there and he had no doubt that she was fully aware of the monies loaned, their purposes and that she was aware of the use and dissipation of those funds and that she benefited from them. [42] Mr. Saggi does not offer much in the way of support for the beliefs he attested to, but none of these beliefs is specifically dependent upon any of the exhibits that the moving defendant complains about. [43] Master Graham cited the decision of Marrocco J. in [Royal Bank v. 1514357 Ontario Ltd., 2011 ONSC 5288](https://www.canlii.org/en/on/onsc/doc/2011/2011onsc5288/2011onsc5288.html), quoted in [Albaroudi v. Tarakji, 2013 ONSC 1204, para. 20](https://www.canlii.org/en/on/onsc/doc/2013/2013onsc1204/2013onsc1204.html). In *Albaroudi*, Richetti J. declined to discharge a certificate of pending litigation in a claim for constructive trust based on contributions made by the plaintiff during a common law relationship with the defendant: [20] In *Royal Bank of Canada v. 1514357 Ontario Ltd.*, Justice Marrocco at para. 41 made the following comment applicable to this case: “I am satisfied that RBC is required to demonstrate that it has a reasonable claim, not that the claim is likely to succeed. The appropriate test in this regard was set out by Justice Blair [as he then was] in *Transmaris Farms Ltd. v. Sieber*, [1999] O.J. No. 300, at para. 62: Under the [Courts of Justice Act, R.S.O. 1990, c. C.43](https://www.ontario.ca/laws/statute/90c43), section 103, a certificate of pending litigation may be issued by the court where a proceeding is commenced in which an interest in land is in question. The authorities cited above confirm the principle that if reasonable claims are put forward in an action for a constructive trust or a fraudulent conveyance in respect of a property, a certificate of pending litigation may issue pending trial. The party seeking the certificate need not prove its case at this point. The test is met where there is sufficient evidence to establish a reasonable claim to an interest in the land based upon the facts, and on which the plaintiff could succeed at trial: *Vettese v. Fleming*, [1992] O.J. No. 1013, supra, at pp. 244-245 (per Chapnik J.); *931473 Ontario Limited v. Coldwell Banker Canada Inc.* (1991), 5 C.P.C. (3d) 238 (Ont. Gen. Div., Sutherland J.), at pp. 257-261. [44] Ms. Gatto argues that there was insufficient evidence to establish a claim to an interest in her lands (the Dickson Park Property) on which the plaintiffs could succeed at trial. [45] I agree with the plaintiffs that the evidentiary bar is low. However, the issue here is whether the constructive trust claim (which has been held to constitute an interest in land for purposes of the issuance of a certificate of pending litigation in appropriate cases) is too remote on the facts as alleged, even if accepted. These issues were not fleshed out in any detail on the ex parte motion before Master Graham. The pleading made the allegations, which he accepted as true. Now that the record is more developed, I will consider this question in the context of my determination about whether to discharge the CPL. ### Should the CPL be Discharged? [46] The court’s discretion to discharge a certificate of pending litigation is found in s. 103(6) of the [Courts of Justice Act](https://www.ontario.ca/laws/statute/90c43). [47] In [GPI Greenfield Pioneer Inc. v. Moore](https://www.canlii.org/en/on/onca/doc/2002/2002canlii6832/2002canlii6832.html), 58 O.R. (3d) 87 paras. 18-20 (citing [Procopio v. D'Abbondanza (1969)](https://www.canlii.org/en/on/onca/doc/1969/1969canlii291/1969canlii291.html), [1970] 1 O.R. 127 at p. 128, Borins J.A. held that a certificate of pending litigation should not be discharged where “there is a triable issue as between the parties as to an interest in the lands in question….” and that: the onus was on the moving party, Ms. Moore, to demonstrate that there was no triable issue in respect to whether the respondent had "a reasonable claim to the interest in the land claimed". As such, the onus is analogous to that of a defendant seeking a summary judgment dismissing a plaintiff's claim under Rule 20 of the [Rules of Civil Procedure](https://www.ontario.ca/laws/regulation/900194). As on a Rule 20 motion, the role of the motion judge was not to find as a fact whether the respondent had, or did not have"a reasonable claim to the interest in the land" which was the subject of the claim in his action against Ms. Moore. That issue remained to be determined at the trial of the pending action. Just as the finding of a motion judge on a Rule 20 motion that a genuine issue for trial exists in respect to a plaintiff's claim cannot support a plea of res judicata at the trial of that issue, neither can a finding of a motion judge on a s. 103(6) motion to discharge a CPL that there is a triable issue in respect to whether the registrant has a reasonable claim to the interest in the land support a plea of res judicata at the trial of a claim for damages under s. 103(4) of the CJA. This is because no adjudication of the registrant's interest in the land is required on a motion to discharge a CPL. [48] The factors to consider in the exercise of court’s discretion in deciding whether to discharge a certificate of pending litigation were explained in [Mohammed v. Karigar, at paras. 5-6](https://www.canlii.org/en/on/onsc/doc/2006/2006canlii24340/2006canlii24340.html): a. where the party at whose instance it is issued (i) claims a sum of money in place of or as an alternative to the interest in the land claimed, (ii) does not have a reasonable claim to the interest in the land claimed, or (iii) does not prosecute the proceeding with reasonable diligence (s. 103(6)(a)); b. where the interests of the party at whose instance it was issued can be adequately protected by another form of security (s. 103(6)(b)); c. on any other ground the court considers just (s. 103(6)(c)); and d. the court may, in making the order, impose such terms as to the giving of security or otherwise as the court considers just (s. 103(6) (concluding clause)). [49] The focus in this case is on the reasonableness of the plaintiffs’ claims to an interest in the Dickson Park Property and whether those claims raise a triable issue. Their claims to an interest in land arise from their pleas of constructive trust, unjust enrichment and equitable tracing. [50] The plaintiffs’ constructive trust, unjust enrichment and equitable tracing claims are based on essentially three foundational assertions that: a. Ms. Gatto received a salary from the Grillone law firm that was improperly paid from the monies loaned by the plaintiffs; b. Mr. Grillone must have been contributing to the payments of the mortgage, property taxes and/or improvements to the Dickson Park Property because Ms. Gatto’s salary was not enough to cover those costs and it should be inferred that Mr. Grillone’s source of the funds he contributed was the plaintiffs’ loan monies; and/or c. By virtue of a spousal power of attorney for property granted by Mr. Grillone to Ms. Gatto and Ms. Gatto’s bookkeeping responsibilities at the law firm, it should be inferred that she was involved in or had knowledge that the source of funds used to pay her salary and used to fund Mr. Grillone’s contributions to the carrying and capital costs of the Dickson Park Property was the plaintiffs’ loan monies which were intended for file-related disbursements. [51] The uncontroverted evidence of the defendants is that Ms. Gatto was paid a market salary for her part-time work for the law firm out of the law firm’s general account. I have been provided with no authority that suggests that a constructive trust could be claimed over an indirect benefit that she may have received from the plaintiffs’ loans through her salary, even if it was used to pay the mortgage, property taxes and improvements to the Dickson Park Property as she acknowledges it would have been. [52] The uncontroverted evidence of Ms. Gatto is that she was not a partner in Mr. Grillone’s law practice, and she had no authority or control over its business or affairs. Although she had a spousal power of attorney over Mr. Grillone’s property, she never acted on it. She had no knowledge of or involvement in the loans or transactions that her husband engaged in with the plaintiffs. Mr. Saggi’s beliefs about Ms. Gatto’s knowledge of the source of funds used to fund her “lifestyle” and household expenses having been the plaintiffs’ loan monies are just that: beliefs or his speculation, that have now been countered by this new evidence from Ms. Gatto. [53] Ms. Gatto’s acknowledgement that, after the fact, she was aware of loans from the plaintiffs to her husband which she described as “disbursement loans” does not equate with knowledge at the relevant times (e.g. when she was receiving her salary or contributions from her husband to the household expenditures) that she was in knowing receipt of the plaintiffs’ loan monies that were intended for a different purpose. Such an inference is not supported by the record before me. [54] Ms. Gatto and Mr. Grillone have attempted to put forward circumscribed evidence in the form of bald denials in an effort to refute the possibility that any of the loaned monies were used to pay the mortgages and property taxes and improvements on the Dickson Park Property (aside from indirectly, through Ms. Gatto’s salary). Through the cross-examinations, a number of discrepancies have been raised by the plaintiffs that challenge the veracity of those statements which, to date, have not been explained by Ms. Gatto and Mr. Grillone. In these circumstances, I cannot accept and rely on the defendants’ bald denials to decide this motion. [55] However, now that the parties are all represented and there is a more fulsome evidentiary record before the court, the plaintiffs’ assertions in the Amended Claim, and Mr. Saggi’s beliefs and speculation about the use of the plaintiffs’ loan monies to fund the lifestyle of Ms. Gatto and Mr. Grillone, when considered in light of the further evidence and arguments that have been presented, are not enough to sustain a finding that there is a triable issue of a reasonable claim to an interest in the Dickson Park Property. [56] The plaintiffs argue that Mr. Saggi’s beliefs and speculation are now further supported by inferences that they ask the court to draw to conclude that: a. Mr. Grillone must have been contributing to the payments of the mortgage, property taxes and/or improvements to the Dickson Park Property because it has been established on cross-examination that Ms. Gatto’s salary was not enough to cover those costs; that Mr. Grillone was contributing regularly to their joint bank account; and that those contributions were, in turn, used to fund the household expenses; and b. the source of Mr. Grillone’s funds was, at least in part, the plaintiffs’ loan monies. [57] The plaintiffs argue that the court can draw these as adverse inferences from the refusal of Ms. Gatto and Mr. Grillone to produce their banking records after it was established on cross-examination that, contrary to their bald denials, the limited records that were produced disclosed that Mr. Grillone appears to have been contributing funds regularly to their joint bank account and that account was, in turn, the source of some of the monies used to fund the household expenses. [58] Ms. Gatto argues that the connection between the Dickson Park Property and the plaintiffs’ loan monies is too remote to give rise to a triable issue of a claim to a constructive trust or equitable tracing. I agree. [59] To begin with, there is no direct evidence that any of the plaintiffs’ loan monies were used to pay for household expenses or that the Dickson Park Property was enhanced through renovations funded by the loan monies. [60] Even if I infer, as the plaintiffs urge me to do, that the loan monies were deposited and co-mingled into a law firm bank account from which Mr. Grillone took a salary and/or draw and he used those funds to contribute to the household expenses and the expenses of daily living for his family, I have not been presented with any authority from the plaintiffs that doing this would give rise to a reasonable claim of a constructive trust in their favour. [61] The evidence that I have been directed to about the timing of improvements to the Dickson Road Property after the plaintiffs advanced their loan monies in 2018 and 2019 is scant. [^3] Ms. Gatto indicated on cross-examination that, since 2017 (e.g. since the loan monies were advanced), she spent approximately $12,000.00 to renovate a bathroom. In subsequently produced emails dated in August 2019 concerning the listing of the Dickson Park Property, Ms. Gatto provided an estimate to the listing agent that she had spent approximately $550,0000.00 on renovations. The email does not indicate the timing of these renovations. Counsel for Ms. Gatto points out that there is evidence of other loans and mortgages on the property that could have been used to fund these renovations. He argues that there is no evidence to counter Ms. Gatto’s response to the direct question asked on cross-examination regarding the renovations that were undertaken after 2017. [62] While the evidentiary threshold is low at this stage of the action, and I appreciate that the plaintiffs do not have access to the plaintiffs’ financial records, to simply allege that the plaintiffs’ loan monies were used to fund improvements to the Dickson Park Property is not enough. The plaintiffs do not have to prove at this stage that this in fact occurred, but they need to have some evidence to enable an inference to be drawn that it might have occurred in order to raise a triable issue. In that regard, they fall short. [63] The only possible connection between the plaintiffs’ loan monies and improvements to the property that I could infer would be for the $12,000.00-bathroom renovation. However, even for that, the authorities require something more than the mere fact that the renovation took place after the plaintiffs’ loan monies were advanced. [64] I agree with the moving defendant that this case is distinguishable from the constructive trust cases relied upon by the plaintiffs. In those cases, unlike this case, there was some evidence of a direct connection between the funds and the property at issue, and/or some misconduct or knowledge of misconduct by, and unjust enrichment of, the owner of the property at issue. *Royal Bank*; [Albaroudi v. Tarakji, 2013 ONSC 1204](https://www.canlii.org/en/on/onsc/doc/2013/2013onsc1204/2013onsc1204.html), [Century Services Inc. v. New World Engineering Corp, at paras. 13, 16-19, 23](https://www.canlii.org/en/on/onsc/doc/2009/2009canlii44410/2009canlii44410.html), [HarbourEdge Mortgage Investment Corporation v. Community Trust Company, 2016 ONSC 448, at paras. 45, 56-57](https://www.canlii.org/en/on/onsc/doc/2016/2016onsc448/2016onsc448.html), [Huntjens v. Obradovic, 2019 ONSC 4343, paras. 35-36, 40-45](/on/scj/2019/4343), [B.M.P. Global Distribution Inc. v. Bank of Nova Scotia, 2009 SCC 15, [2009] 1 SCR 504 at para. 85](https://www.canlii.org/en/ca/scc/doc/2009/2009scc15/2009scc15.html)), [Soulos v. Korkontzilas, [1997] 2 S.C.R. 217, paras. 34-36](https://www.canlii.org/en/ca/scc/doc/1997/1997canlii346/1997canlii346.html). [65] In this case, the connection depends upon inferences, which, even if established, are not the types of circumstances that have grounded triable constructive trust claims in the authorities cited. A basis (aside from speculation) to connect the plaintiffs’ loan monies to the Dickson Park Property in a way that establishes some enhancement to the property or implicates the landowner (who in this case has only ever been Ms. Gatto) is lacking. Some basis for that connection is essential to ground a claim for constructive trust and equitable tracing. See [Boal v. International Capital Management Inc., 2018 ONSC 2275, at paras. 93-94](https://www.canlii.org/en/on/onsc/doc/2018/2018onsc2275/2018onsc2275.html). I am concerned about setting a precedent (absent some authority for doing so) that the mere fact that funds from a spousal joint bank account were used to fund household expenses and a minor renovation, without anything more, is enough to create a triable claim of an interest in land to justify the continuance of a CPL over that land in favour of a lender to the business of one of the spouses. [66] The other grounds that were raised in support of the plaintiffs’ claims to an interest in Ms. Gatto’s lands do not withstand scrutiny: a. The suggestion at the time the CPL was granted, that the listing for sale of Dickson Park Property just after the original statement of claim had been served on Mr. Grillone in September 2019, was a signal that there might have been a fraudulent conveyance of the property to her and that its sale could lead to the dissipation of the proceeds taking them out of the reach of Mr. Grillone’s creditors, has been addressed: The record establishes that Ms. Gatto has been the registered owner of the Dickson Park Property since it was purchased. She was also the registered owner of the previous family home, the net sale proceeds of which were used to fund the down payment for the purchase of the Dickson Park Property. There is also evidence that the listing had been in the works since at least August 2019. b. Mr. Grillone has no direct or indirect interest in or claim to the Dickson Park Property: For valuable consideration (Ms. Gatto guaranteed certain indebtedness of Mr. Grillone and his law firm to the Bank of Nova Scotia) Mr. Grillone released any claims under the [Family Law Act](https://www.ontario.ca/laws/statute/90f03) and at common law to the matrimonial home (the Dickson Park Property) and has declared that he has no titular, proprietary or equitable interests in that property. If he were ever to become entitled to an equalization payment from Ms. Gatto that might create a source of funds for his creditors, but I have not been directed to any authority that would convert that contingent claim to an equalization payment by Mr. Grillone into an interest in favour of his creditors in the Dickson Park Property (or subsequent property) owned by his wife. The authorities I have been directed to are to the contrary, and establish that: i. a wife’s agreement to transfer an interest in the matrimonial home does not create an interest in favour of the husband in the home until the consideration for that agreement has been received. Creditors of the husband cannot attach to the wife’s beneficial and legal title which has not yet been transferred to the husband. See [Millar v. Millar (1991), 1991 ABCA 261](https://www.canlii.org/en/ab/abca/doc/1991/1991abca261/1991abca261.html), 8 C.B.R. (3d) 220 (Alta. C.A.); and ii. until a non-titled spouse is vested with an interest in the matrimonial home by a court order, he or she holds no interest. See [Maroukis v. Maroukis (1981)](https://www.canlii.org/en/on/onca/doc/1981/1981canlii77/1981canlii77.html), 125 D.L.R. (3d) 718, 33 O.R. (2d) 661 (C.A.), at para. 15, reasons of Wilson J.A. (as she then was), dissenting in part but not on this point, aff’d [1984 76 (SCC)](https://www.canlii.org/en/ca/scc/doc/1984/1984canlii76/1984canlii76.html), [1984] 2 S.C.R. 137. iii. and even if an equalization order is made, property rights are not necessarily vested. [Thibodeau v. Thibodeau, 2011 ONCA 110](https://www.canlii.org/en/on/onca/doc/2011/2011onca110/2011onca110.html), 104 O.R. (3d) 161, at para. 43. c. There is no actual trust in the Dickson Park Property in favour of Mr. Grillone: Ms. Gatto’s unchallenged evidence is that she does not hold any interest in the Dickson Park Property (or any other property) in trust for Mr. Grillone. d. The Dickson Park Property does not stand, directly or indirectly, as security for the plaintiffs’ loans: Ms. Gatto was not a party to the loan agreement. She was never asked for, and did not provide, a personal guarantee of the plaintiffs’ loans to her husband and his law practice. Nor was any mortgage over the Dickson Park Property requested as security for the plaintiffs’ loans (until after the alleged defaults at which time it was refused). ## Disposition, Costs and Further Directions ### Final Disposition [67] I find on the record before me that no triable issue has been raised of a reasonable claim by the plaintiffs to an interest in the Dickson Park Property owned by Ms. Gatto. This is not a criticism or overruling of Master Graham’s decision to grant the CPL, which was made ex parte and did not have the benefit of the evidentiary record and arguments that have since been developed. On the record before me, the equities favour the discharge of the CPL as against the Dickson Park Property at this time. [68] There was also an appearance of some potential impropriety at the time the CPL was granted given the timing of the listing for sale of the Dickson Park Property in relation to the service of the original statement of claim, but that has been addressed. Ms. Gatto has further explained that she requires the Dickson Park Property net sale proceeds (e.g. equity) to close the purchase of the New Property. [69] Ms. Gatto’s solicitor advised the court that she is not asking for the dismissal of the claims against her for constructive trust or tracing of the plaintiffs’ loan funds. The position is simply that those claims in the circumstances of this case are not of a character that give rise to an interest in the Dickson Park Property. [70] In the exercise of my discretion under s. 103(6)(a) and (c) of the [Courts of Justice Act](https://www.ontario.ca/laws/statute/90c43), I am granting the motion by Ms. Gatto for the discharge of the CPL as against the Dickson Park Property and I decline to impose any of the plaintiffs’ Proposed Conditions on the discharge. [71] I make the following orders to give effect to this discharge: a. an Order discharging and vacating the CPL from the Dickson Park Property; and b. an Order that the Registrar of the Land Titles Office at Peel forthwith remove from the title to the Dickson Park Property (Ontario Land Titles PIN NO: 13359-1101 in the Land Titles Office No: 43 at PEEL) any reference to the CPL and discharging Instrument No: PR3548395 from the title to those lands. [72] The record has not been fully developed in respect of the CPL that was issued over the Spectrum Way Property. I have not been asked to discharge the CPL in respect of that property. My decision as it relates to the Dickson Park Property is fact-specific and limited to that property. The considerations may very well be different in relation to the Spectrum Way Property from which Mr. Grillone carried on his practice of law. The link between the plaintiffs’ loan monies and that property may not be as remote. ### Costs [73] I have not decided this motion based on the alleged evidentiary deficiency relating to the manner in which the supporting affidavit was commissioned or in which its exhibits were identified. While the outcome has resulted in an order in favour of the moving defendant, there has been some divided success in terms of time and resources devoted to issues that she did not succeed on. [74] I decline to make the further orders requested by Ms. Gatto. I am only granting the relief that is required to give effect to the discharge of the CPL and to enable the sale of the Dickson Park Property to be completed on the scheduled closing date of July 8, 2020. [75] One of the additional heads of relief requested was a dismissal of the plaintiffs’ request for a Mareva injunction as against Ms. Gatto that I have under reserve. I will allow the parties an opportunity to make submissions on whether there are any remaining grounds upon which that injunctive relief might be grounded, having regard to my findings herein. [76] I do not consider this to be the type of situation that attracts liability under s. 103(4) of the [Courts of Justice Act](https://www.ontario.ca/laws/statute/90c43) or that costs against the plaintiffs’ solicitor personally are warranted under Rule 57.07(1) of the [Rules of Civil Procedure](https://www.ontario.ca/laws/regulation/900194). My decision is not based on any deficiency in the evidentiary record before Master Graham that would support the request for costs against the solicitor for the plaintiffs personally. Costs against a solicitor personally are reserved for extreme situations, which this is not. The plaintiffs took a high-level approach to the request for a CPL based on allegations of a constructive trust. The CPL was granted on that basis but has now been discharged based on more fulsome argument. There is no suggestion that plaintiffs’ counsel intentionally misled the court when the CPL was granted. [77] I do not consider the plaintiffs’ request for the CPL to have been unreasonable when it was made initially. It was based on the information that was available, and Master Graham was satisfied that it was appropriate to do so at the time. The plaintiffs also acted reasonably in the context of this motion by suggesting the Proposed Conditions as a way of ensuring that the CPL did not interfere with sale of the Dickson Park Property and in their efforts to preserve the status quo by requesting that a CPL be placed on the New Property. While I have not accepted their Proposed Conditions, they are a relevant consideration to the matter of the costs of this motion. As circumstances have evolved, Ms. Gatto has purchased the New Property and the concerns about the circumstances of the timing of her listing of the Dickson Park Property and intentions regarding the use of the sale proceeds have been assuaged through the development of the evidentiary record. [78] In all of the circumstances, and in the exercise of my discretion under Rule 57.01 of the [Rules of Civil Procedure](https://www.ontario.ca/laws/regulation/900194) and s. 131 of the [Courts of Justice Act](https://www.ontario.ca/laws/statute/90c43), I am not awarding any party their costs of this motion. Each shall bear their own costs. ### Directions Regarding Other Pending Motions/Proceedings [79] A concern was raised by plaintiffs’ counsel at the conclusion of argument about a court-supervised buy out of Mr. Grillone’s interest in 189 (the company that owns the Spectrum Way Property) in action No. 20-638053-00CL. An undertaking was requested to protect any sale proceeds pending the determination of the Mareva injunction that I have under reserve. The plaintiffs had not put any of the other parties on notice of this concern or request. Given that it was late in the day and that the matter had not been noticed or briefed, I suggested that the plaintiffs or any other interested creditors of Mr. Grillone raise this issue for interim relief with Justice Koehnen who is case managing the Commercial List Action, when they are next before him with proper notice. I would ask that any party who makes such a request bring this endorsement to Justice Koehnen’s attention. [80] I have directed that counsel confer following the release of my decision and try to come up with a schedule and joint proposal for: a. The plaintiffs to identify what fresh evidence they wish me to grant them leave to file before I decide their Mareva injunction motion; b. The parties to exchange written submissions setting out their positions on whether leave to file that evidence should be granted and its relevance to the issues that I have under reserve on the Mareva injunction motion; c. The responding defendants to identify any evidence that they would be asking leave to file if the fresh evidence is to be received; d. Whether the fresh evidence motion can be decided based on a written record with my decision to be incorporated into the decision I have under reserve on the Mareva injunction motion, or if any party takes the position that an oral hearing is required then a brief explanation as to why; and e. Any further submissions that they wish to make arising out of this decision and its implications for the Mareva injunction against Ms. Gatto. [81] After counsel have conferred regarding the above, they may either present a joint written proposal concerning the above for me to consider, or if they cannot agree, they may request a chambers appointment with me during or after the week of July 26, 2020 at which I will receive their competing proposals and provide further directions concerning the timing and manner of briefing and adjudication of the plaintiffs’ fresh evidence motion. Such request should be made in advance of that week. [82] Notwithstanding Rule 59.05 of the [Rules of Civil Procedure](https://www.ontario.ca/laws/regulation/900194), this endorsement and the orders and directions herein are effective from the date indicated below and are enforceable without any need for entry and filing. In accordance with Rules 77.07(6) and 1.04, no formal Order need be entered and filed unless an appeal or a motion for leave to appeal is brought to an appellate court. Any party to this Order may nonetheless submit a formal Order for original signing, entry and filing when the Court returns to regular operations. Kimmel J. Released: July 3, 2020 --- ## Footnotes [^1]: Although the plaintiffs suggest that this is untrue because the net sale proceeds of the prior home appear to be less than the down payment for the purchase of the Dickson Park Property, this purchase occurred long before the advance of the plaintiffs’ loans that are the subject of this action and Ms. Gatto was not asked about this on cross-examination, which leaves open the possibility that she had access to other sources of funds to make up the difference for the down payment on the Dickson Park Property. The essence of Ms. Gatto’s evidence was that all of the net sale proceeds from the prior home were used towards the purchase of the Dickson Park Property, and that she alone was the registered owner of all three family homes, the prior home, the Dickson Park Property and the New Property, and that the net equity has flowed through these properties. [^2]: The alleged deficiency regarding the identification of the exhibits was not remedied in the subsequently filed affidavit by the plaintiffs for the Mareva injunction motion and relied upon in response to this motion. It does appear that the second affidavit addresses one of the moving defendant’s concerns with the original CPL affidavit, regarding the identification of the lawyer (commissioner and notary) who commissioned the affidavit. [^3]: Given the complicated procedural history that includes the CPL motion, the motion for a Mareva injunction, the motion for fresh evidence and this motion, with various affidavits and cross-examinations, the parties were directed before this motion to clearly identify and outline what was relied upon for purposes of this motion. In deciding this motion, I am relying on what I was directed to consider from the larger evidentiary record.