Court File and Parties

Court File No.: CV-19-3830-00 Date: 2022 03 01

ONTARIO SUPERIOR COURT OF JUSTICE

B E T W E E N:

AURELIO ACQUAVIVA and MARIA ACQUAVIVA Plaintiffs Bryan Fromstein, for the Plaintiffs

- and -

JOAN HOLMES Defendant Domenic Saverino, for the Defendant

HEARD: September 1, 2021, by zoom videoconference

REASONS FOR DECISION Emery J.

Endorsement

[1] The defendant, Joan Holmes, is the owner of the property at 15 Quatro Crescent in Brampton (the “property”). In 2018, Ms. Holmes encountered difficulty in refinancing the property to pay out the first charge registered by CIBC against title. She was admittedly in financial distress. Ms. Holmes therefore entered into an agreement to grant a first charge having a higher interest rate, and to pay a lender’s fee to the plaintiffs, Aurelio Acquaviva and Maria Acquaviva (the “Acquavivas”) in July 2018. Ms. Holmes granted this charge having a face amount of $720,000 for a six month term.

[2] At the same time, Ms. Holmes granted another charge against title having a face value of $$775,000 to another lender, 26224221 Ontario Inc. (“262”). The funds raised by this charge flowed through the same trust account of lawyer Anthony Maniaci as the funds for the Acquaviva charge, as Mr. Maniaci was representing both lenders. Ms. Holmes used funds financed by the two charges to pay out the balance of $835,505 owed under the previous first charge to CIBC. The amounts secured under the Acquaviva charge and the charge to 262 totalled $1,450,000.

[3] The Mortgage Commitment Letter for the Acquaviva charge set out the contractual terms for what financing would be secured by the charge. The terms provided that Ms. Holmes would pay the annual interest rate of 9.75% to the Acquavivas on any unpaid balance. These terms included an amount Ms. Holmes borrowed to pre-pay the interest under the charge for six months. Under the charge itself, Ms. Holmes was required to only pay interest on the principal amount financed during the six month term.

[4] When the Acquaviva charge came due in December 2018, Ms. Holmes was not in a financial position to pay it out. As the time covered by prepaid interest had elapsed, Ms. Holmes made interest payments in each of the first six months of 2019. Ms. Holmes has not made any other payment to the Acquavivas since June 2019.

[5] The Acquavivas have brought this action to enforce the contractual terms of the charge. They seek judgment on the covenant for the amount due and owing, as well as possession of the property so that it can be sold to enforce the security. In the context of the action, the Acquavivas have brought this motion for summary judgment. The Acquavivas’ claim as of the date of the motion, is composed of the following:

a. Judgment for $843,227.42 as of March 3, 2021 (the first return date for the motion), plus post-judgment interest at 9.75% per annum (the mortgage interest rate). As of September 1, 2021, the amount owing was $878,231.48; b. Judgment for possession; c. Leave to issue a writ of possession against the property; and d. Costs of the motion and the action on a full indemnity basis.

[6] Ms. Holmes has pleaded a number of defences in her statement of defence. She has given evidence about some of those defences in response to this motion for summary judgment. She submits that the evidence given on those defences raises a genuine issue requiring a trial. Ms. Holmes has also provided evidence to as to other reasons why summary judgment should not be granted that she has not pleaded.

[7] Unfortunately for Ms. Holmes, the evidence filed on this motion for summary judgment provides an adequate record for the court to conclude that there is no genuine issue that requires a trial. Ms. Holmes borrowed far more from the Acquavivas than she could afford to repay at the end of the term. She has not repaid any amount owed to the Acquavivas at all, and the charge she granted as security matured over three years ago.

[8] For the reasons that follow, I grant summary judgment to the Acquavivas. Ms. Holmes is in default of her contractual obligations under the charge. All that is at issue is the proper amount she owes under that charge, including interest. I am therefore directing a trial to hear evidence under Rule 20.04(3) to determine the principal amount owing. That determination will allow Ms. Holmes to know the amount payable in the event she intends to seek refinancing.

Background

[9] The facts that Ms. Holmes granted the charge to the Acquavivas in July 2018, and that funds were advanced are uncontroversial and supported by the evidence. The Acquaviva charge contained the following terms:

Principal $720,000 Calculation Period monthly not in advance Balance Due Date 2019/01/01 Interest Rate 9.75% per annum Payments $5,850.00 Interest Adjustment Date 2018 07 01 Payment Date 1st day of each and every month First Payment Date 2018 08 01 Last Payment Date 2019 01 01 Standard Charge Terms 200033

[10] According to the Mortgage Commitment Letter, the Acquavivas provided cheques totalling $649,292.05 to their lawyer, Anthony Maniaci, in trust. This amount was calculated as follows:

a. Gross amount of Mortgage @ 9.75%, $720,000.00 b. Less: Six months of prepaid interest $720,000x9.75%/12x6 ($35,100.00) c. Interest adjustment date of 2 months 12 days ($14,007.50) d. Lender's Fee of 3% x $720,000.00 ($21,600.00) Net Amount $649,292.05

[11] The following cheques and drafts were paid to the Acquavivas’ lawyer, Mr. Maniaci, in trust:

HSBC Canada June 28, 2018 $174,292.05 BMO June 28, 2018 $35,000.00 IC Savings June 28, 2018 $400,000.00 IC Savings June 28, 2018 $40,000.00 Total $649,292.05

[12] The trust ledger produced by Mr. Maniaci shows that sufficient funds were advanced to CIBC from his trust account to discharge the previous charge. Ms. Holmes admitted, on cross-examination, that she did not use any of her own funds to pay out CIBC.

[13] The parties agreed that Standard Charge Terms 200033 would provide the terms of the Acquaviva charge. Those terms state that upon default, the Acquavivas would be entitled to possession of the property. Standard Charge Terms 200033 also provide that all enforcement costs are recoverable on a “solicitor and client” basis.

[14] There is no dispute that Ms. Holmes stopped making interest payments on July 1, 2019. The charge has been in default since that date and interest has continued to accrue.

[15] The Acquavivas’ lawyer sent a demand letter to Ms. Holmes on July 19, 2019.

[16] On January 29, 2021, the lawyer for the Acquavivas wrote the lawyer for Ms. Holmes to inquire "whether there is anyone else who should receive notice of the motion as a result of my client seeking leave to obtain a writ of possession." The lawyer for Ms. Holmes did not respond.

[17] Ms. Holmes remains in possession of the property, despite only making interest payments until June 2019. Ms. Holmes testified in her cross-examination that she lives at the property with her two children, Kevin Simpson, Ellesia Simpson, and three tenants, Beatrice, Charlotte, and Darcas. These tenants do not have written leases.

[18] Each adult who lives at the property has been provided with notice of this motion.

The Acquavivas’ Position

[19] The Acquavivas submit that this action is a straightforward mortgage enforcement case. It is the kind of case that is suitable for summary judgment. Although Ms. Holmes has pleaded allegations in her statement of defence that the charge offends the (Canada) Interest Act, or that an oral agreement was entered that allegedly changed the true agreement between the parties, those defences are not supported by the evidence to make out a genuine issue requiring a trial.

[20] The Acquavivas seek judgment for all amounts owing, plus interest, and possession of the property as a result of Ms. Holmes’ default and her failure to pay out the charge. They also seek all of their costs for having to take mortgage enforcement proceedings. They rely on the provisions of the standard charge terms that allow them to claim costs on a full indemnity basis.

[21] Given that Ms. Holmes was in default, the Acquavivas delivered a notice of sale under charge on December 11, 2019. The notice of sale and statement of claim both claim simple interest only. There is nothing in the mortgage, notice of sale, or statement of claim that would violate Section 8 of the Interest Act.

[22] On April 9, 2021, Ms. Holmes commenced an action against eighteen defendants (the “2021 action”), including the Acquavivas. The allegations against Aurelio and Maria Acquaviva in the 2021 action are essentially that they were somehow required to ensure that the amount of all mortgages against title should not exceed the fair market value of the property, and that they owed fiduciary duties to Ms. Holmes.

[23] The Acquavivas submit that those allegations are no reason to dismiss this summary judgment motion. In her affidavits and on cross-examination, Ms. Holmes was unable, or has refused to provide evidence that any of the allegations in the statement of claim filed in the 2021 action were true.

[24] If there are further findings of fact required to dispose of the action, the Acquavivas submit that there is no genuine issue requiring a trial to resolve their claim. Even if Ms. Holmes could raise a genuine issue for trial on the written record, the court still has the powers available under Rule 20.04(2.1) and (2.2). Under those subrules, the court can:

a) Weigh the evidence; b) Evaluate credibility; and c) Draw reasonable inferences from the evidence.

The Position of Ms. Holmes

[25] Ms. Holmes has defended the claim by alleging that the Acquavivas promised to renew the charge for one year commencing January 1, 2019. She argues that the Acquavivas are therefore estopped contractually from enforcing the charge during the renewal period. She also alleges that the interest rate under the charge violated the (Canada) Interest Act; that there was a side deal with the mortgage broker that bound the Acquavivas; and that there is a genuine issue about the amounts advanced and therefore owing under the charge.

[26] In her affidavit, Ms. Holmes describes how she was introduced to one Joseph Ngadi, a mortgage broker, in 2017 to assist her with refinancing the property. As a result of advice from Mr. Ngadi, she transferred an interest in her property to Margaret Omoregie, in trust, in a ruse to obtain that financing from CIBC.

[27] While Ms. Omoregie’s name was on title, Ms. Holmes states that she learned the property was for a time transferred into Ms. Omoregie’s name alone for a stated value of $400,000. Ms. Holmes alleges in her motion materials that this transfer was facilitated by a lawyer, Granville Cadogan. Ms. Holmes commenced legal proceedings with Ms. Omoregie and ultimately title to the property was transferred back to her in July 2018.

[28] Ms. Holmes describes other transactions in her affidavit that seemingly complicate the facts. She states that she learned in the course of arranging the Acquaviva loan that a second charge has been registered against title after the CIBC charge. This second charge was granted to Robert and Anna Tatangelo in September 2017, and had been subsequently transferred to 262. The charge to the Tatangelo’s was initially for $200,000, which became $300,000 on registration. Ms. Holmes knew that this second charge would be registered against title, but is unaware of how the proceeds were distributed beyond the $53,000 she received.

[29] Ms. Holmes alleges in her statement of defence that Sabine Quatrocciochi (“Sabine”) induced her to agree to the terms of the Acquaviva charge by representing that the lender’s fees would be returned to her when the charge was refinanced or renewed. Ms. Holmes alleges that Sabine made representations to her as agent for the Acquavivas that were different than the terms contained in the mortgage documents.

[30] In a supplementary affidavit, Ms. Holmes also made allegations that Sabine and Prisila Pietropaolo (“Prisila”) conspired to defraud her of equity she held in the property. Prisila was a law clerk in Mr. Maniaci’s law office. Ms. Holmes commenced the 2021 action to advance the claim against several parties, including the Acquavivas, of committing a fraud to deprive her of the equity in the property. That claim is based on the theory that the amount of the charges arranged by those parties and registered against title exceeded the fair market value of her property. She has stated in her evidence that the property had a fair market value of only $1 million at the time the Acquaviva charge was registered.

[31] In summary, Ms. Holmes asserts in her submissions that she was misled by Sabine, whom she alleges acted in concert with Prisila from Mr. Maniaci’s law office, to encumber her property with the registration of the Acquaviva charge. She alleges that Sabine was acting as the agent of the Acquavivas at all material times. Ms. Holmes claims that she has suffered a loss from this refinancing when the proceeds were diverted or withheld from her, should she remain liable for those proceeds. As a result, she claims that summary judgment should be denied because of several genuine issues that require a trial.

Issues and Analysis

[32] The following issues are raised by the Acquavivas on the motion:

A. Is this an appropriate case for summary judgment? B. If so, is there no genuine issue requiring a trial?

A. This is an Appropriate Case for Summary Judgment.

[33] The Supreme Court of Canada set out the principles the court is to apply on motions for summary judgment in Hryniak v. Mauldin, 2014 SCC 7. In Mayers v. Khan, 2017 ONSC 200 (aff’d at 2017 ONCA 524), Glustein J. summarized the Hryniak principles as follows:

i) Summary judgment must be interpreted broadly, favouring proportionality and fair access to the affordable, timely and just adjudication of claims. It is no longer merely a means to weed out unmeritorious claims but rather a "legitimate alternative means for adjudicating and resolving legal disputes" (Hryniak, at paras. 5 and 36); ii) An issue should be resolved on a motion for summary judgment if the motion affords a process that allows the judge to make the necessary findings of fact, apply the law to those facts, and is a proportionate, more expeditious and less expensive process to achieve a just result than going to trial (Hryniak, at paras. 4 and 49); iii) On a motion for summary judgment, the judge must first determine if there is a genuine issue requiring a trial based only on the evidence before the judge and without using the judge's fact-finding powers. If there appears to be a genuine issue requiring a trial, the judge should then determine if the need for a trial can be avoided by using the powers under Rules 20.04(2.1) and (2.2) (Hryniak, at para. 66); and iv) The standard for determining whether summary judgment will provide a fair and just adjudication is not whether the procedure is as exhaustive as a trial, but rather "whether it gives the judge confidence that [the judge] can find the necessary facts and apply the relevant legal principles so as to resolve the dispute" (Hryniak, at para. 50). A judge must be confident that he or she can fairly resolve the dispute (Hryniak, at para. 57).

[34] On a motion for summary judgment, each party is required to put their best foot forward. A self-serving affidavit is not sufficient to create a genuine issue for trial in the absence of detailed facts and supporting evidence. See Guarantee Co. of North America v. Gordon Capital Corp. at para. 31, and Grewal v. Khaira et al., 2021 ONSC 4908, at para 25.

[35] The Court of Appeal explained in Broadgrain Commodities Inc. v. Continental Casualty Company, 2018 ONCA 438 that on a summary judgment motion, the court will assume that all necessary evidence has been tendered. A motions judge is entitled to presume that the evidentiary record is complete and there will be no further evidence at trial. A motions judge is not required to resort to the enhanced powers provided by subrules 20.04(2.1) and (2.2) to backfill a party’s evidentiary shortcomings.

[36] Had Ms. Holmes intended to rely on the evidence of other witnesses, it was incumbent on her to include that evidence in her responding materials on the motion. In addition to her main affidavit dated February 23, 2021, the Motion Record contains only the affidavit of Mirella Grady, a law clerk in her counsel’s office. In that affidavit, Ms. Grady gives hearsay evidence from Peter Groccia, an officer of 262 about the transfer of the 262 charge from Robert and Anna Tatangelo.

[37] According to the statement attributed to Mr. Groccia in Ms. Grady’s affidavit, Mr. Groccia denies he ever signed a discharge of the Tatangelo charge transferred to 262. When this charge was discharged on refinancing, a new charge to 262 was registered on title in second place to the registration of the Acquaviva charge. In the event that this statement is intended as evidence to set up a priority contest between the Acquavivas and 262, that is a contest for those parties to resolve as between them elsewhere. It is not a wedge issue between Ms. Holmes and the Acquavivas for the purpose of this motion.

[38] I do not consider the evidence that Ms. Grady has given about what Mr. Groccia allegedly said to be admissable in any event as it is hearsay. A statement made by a third party that is tendered as evidence for the truth of its contents is hearsay evidence if that witness is not available for cross-examination: R. v. Khelawon, 2006 SCC 57, at paras. 35 and 56. If the statement does not fit within one of the permitted exceptions to the hearsay rule, it can be admissible if it meets the twin requirements of necessity and reliability: Khelawon, at para. 42.

[39] Ms. Holmes has also filed a supplementary affidavit dated June 11, 2021, alleging she has been a victim of fraud through an elaborate mortgage scheme through the Maniaci law office. Ms. Holmes asks in that affidavit that the 2021 action be consolidated with this action so that they can be heard together, although she has not brought a motion for that relief.

[40] Given that Ms. Holmes has commenced a separate proceeding against various parties concerning the same subject matter, the court should undertake the analysis of whether the issues in this action and the other action are intertwined: Spiridakis v. Li, 2021 ONCA 35, at paras 13-15. This means the court should give due consideration as to whether the claims made by Ms. Holmes in the 2021 action are severable from the claims of the Acquavivas in this action.

[41] The amounts owed by Ms. Holmes to the Acquavivas are liquidated damages for money borrowed. They are separate and distinct from any claims that Ms. Holmes may have against any mortgage broker, lawyer, or other parties with whom she has had dealings prior to the Acquavivas.

[42] Ms. Holmes has led no evidence of any wrongdoing by the Acquavivas in this case, and there is no risk of an inconsistent verdict. On cross-examination, Ms. Holmes admitted that she had no evidence tying the Acquavivas to any fraud. An allegation that a borrower entered into a loan agreement or granted a charge because of the misfeasance of third parties does not mean that the borrower is not liable to repay the borrowed funds. At most, it provides a basis for a claim that a borrower may have against others for the funds borrowed from the lender. See 2165330 Ontario Inc. v. Finch, 2015 ONSC 5789 (Div. Ct.).

[43] The request of Ms. Holmes in her supplementary affidavit to consolidate this action with the 2021 action, should have been in the context of a motion brought under Rule 6.01. In the absence of evidence connecting the Acquavivas to any claim Ms. Holmes is making against third parties in another action, there is no connection between any cause of action she is asserting in the 2021 action and her defence of this action. The request should be recognized for what it is, a tactic to delay the litigation, and an attempt to postpone the inevitable consequences of her default.

[44] I find it significant that Ms. Holmes has made no counterclaim against the Acquavivas to set aside the charge or to off-set any amounts she agreed to pay under the contractual documents underlying the Acquaviva charge. She would likely have done so if she had the evidence to make the claim over against the Acquavivas as part of a larger scheme or conspiracy.

[45] In my view, there is no genuine issue requiring a trial about the enforceability of the Acquavivas charge against the property. It is readily apparent that the Acquaviva claim and the issues in the 2021 action are not intertwined. On the evidence filed, I am confident that I am able to find the necessary facts on which to apply relevant legal principles to adjudicate the Acquaviva claim on its merits.

B. There is no Genuine Issue Requiring a Trial

[46] Ms. Holmes swore two affidavits and has been cross-examined on those affidavits for this motion. Even though the parties agreed to use Rule 34.12, Ms. Holmes refused to answer relevant questions on the basis that she may have some better evidence at a later date. The anticipation of a party to have better evidence at trial will not defeat a motion for summary judgment: Van Nispen v. McCarron & Chobotiuk Financial Services Inc., 2020 ONCA 146, at para. 4. Ms. Holmes has not put her best foot forward and such an approach cannot defeat a summary judgment motion.

[47] Other than pleading section 8 of the Interest Act and the representations allegedly made by Sabine as agent for the Acquavivas, Ms. Holmes did not plead the defences on which she now relies. Rule 20.04(2) allows the court to determine a motion for summary judgment on any claim or defence. This means that the court may determine whether a defence pleaded by Ms. Holmes is viable, and to grant summary judgment if it is not. If Ms. Holmes pleaded a defence on which she has not given relevant evidence to oppose the motion, she has not provided evidence to raise a genuine issue requiring a trial.

The representation to renew the charge

[48] Ms. Holmes has pleaded in her statement of defence that she is "discharged from any and all liability to re-pay the full amount of the registered Mortgage to the Plaintiff for the renewal period of one year from January 1, 2019". This is a non-issue and is dismissed summarily because of the passage of time.

[49] There is no evidence other than a bald allegation by Ms. Holmes that the Acquavivas agreed to renew the charge for one year starting on January 1, 2019. There is no need to assess Ms. Holmes’ credibility or to determine the estoppel issue as the one year term would have expired in any event, on January 1, 2020.

[50] Ms. Holmes did not renew the charge at any time during the one year that commenced on January 1, 2019. Even if the Acquavivas could not bring this action for that year because they had a contractual obligation to renew, the interest on the outstanding principal has continued to accrue at 9.75% annually since July 2019.

The charge does not violate s.8 of the Interest Act (Canada).

[51] In her statement of defence, Ms. Holmes pleads that the charge includes an interest rate that violates s. 8 of the (Canada) Interest Act. Mr. Saverino advised the court in his submissions that Ms. Holmes had abandoned her defence under s. 8 to oppose the motion.

[52] There was no basis for Ms. Holmes to oppose the motion under s. 8 in any event. Section 8 reads:

No fine, etc., allowed on payments in arrears

8 (1) No fine, penalty or rate of interest shall be stipulated for, taken, reserved or exacted on any arrears of principal or interest secured by mortgage on real property or hypothec on immovables that has the effect of increasing the charge on the arrears beyond the rate of interest payable on principal money not in arrears.

Interest on arrears (2) Nothing in this section has the effect of prohibiting a contract for the payment of interest on arrears of interest or principal at any rate not greater than the rate payable on principal money not in arrears.

[53] The Supreme Court of Canada considered section 8 of the Interest Act in Krayzel Corp. v. Equitable Trust Co., 2016 SCC 18, [2016] 1 SCR 273. In paragraph 25 of Krayzel, the majority of the Court found that in respect of s. 8, “[w]hat counts is how the impugned term operates, and the consequences it produces, irrespective of the label used” to describe the term. This provision in effect means that where the effect of a term is to impose a higher rate on arrears than on money not in arrears, then s. 8 is offended.

[54] There is nothing in the Acquaviva charge that imposes a higher rate on arrears than on money owing under the charge not in arrears. The charge bears interest at the rate of 9.75% annually, whether Ms. Holmes is in arrears or not.

[55] On applying the law to the facts, the Acquaviva charge does not violate s. 8 of the Interest Act. Section 8 of the Interest Act prohibits fines, penalties, or interest that have "the effect of increasing the charge on the arrears beyond the rate of interest payable on principal money not in arrears": Krayzel, at para. 25. There are no such charges and Ms. Holmes did not include evidence of this nature in her motion material.

The allegations regarding a side deal

[56] In her statement of defence, Ms. Holmes has not pleaded fraud or the conspiracy to defraud she alleges against Sabine and Prisila, either separately from, or as agents of the Acquavivas. As this defence was not pleaded, it is not available as a defence to consider on a motion for summary judgment. A motion for summary judgment shall be granted where there is no genuine issue requiring a trial on a claim or defence under Rule 20.04(2). It is implicit in the language of the rule that the claim or defence must have been pleaded by one party or the other in the first place.

[57] In the event the defence of fraud or conspiracy to commit fraud is available for Ms. Holmes to raise as a genuine issue in response to the motion, I find that she has not provided evidence to raise a genuine issue on those defences. When cross-examined on her affidavit on July 14, 2021, Ms. Holmes made the following admissions:

a) She did not use any of her own funds to pay out the previous CIBC mortgage (q. 38); b) Sabine told her that the funds from the new mortgages would be used to pay out the CIBC mortgage (q. Q. 39-40); c) She had her own lawyer for the mortgage transaction, Ms. Karageorgievski, who she met with several times (q. 42, 43, 51, 53); d) She has no evidence that the Acquavivas were involved in the allegations at paragraph 16 of Ms. Holmes' first affidavit (q. 66-68); e) She refused to agree that the plaintiffs advanced the funds as set out at paragraph 5 of Mr. Acquaviva’s second affidavit dated May 13, 2021. (q.78-87). When cheques were presented to Ms. Holmes at discovery, her counsel for Ms. Holmes interjected with "those documents say what they say"; f) She signed the documents at Exhibits "G", "H", "I", "J", and "K" to Mr. Acquaviva’s affidavit sworn January 29, 2021 (q 87, q. 105-123); g) She did not know where the money came from to pay out the CIBC mortgage (q. 158); h) She did not know the Acquavivas before 2018 (q. 189); i) She has made no payments on the mortgage because it was prepaid for six months or a year (q. 201-203); and j) She does not have any evidence that Mr. Acquaviva or Mrs. Acquaviva were involved in any fraud (q. 205-207).

[58] Ms. Holmes had the benefit of independent legal advice before granting the Acquaviva charge. Her lawyer, Mariann Karageorgievski, signed an Acknowledgement indicating that she had explained the charge to her, and that Ms. Holmes did not sign the charge under undue influence.

[59] The Acquavivas have also put into evidence an Acknowledgment Re Legal Representation that Ms. Holmes signed herself. This Acknowledgement was witnessed by Ms. Karageorgievski. In this Acknowledgement, Ms. Holmes acknowledged that she was told to obtain independent legal advice, that she in fact did obtain independent legal advice, that she read the mortgage in its entirety, understood her rights and obligations, and that she signed the mortgage voluntarily.

[60] Ms. Holmes also signed an Acknowledgment that the interest rate was "fair, equitable, and reasonable having regard to all of the circumstances of and risks associated with the transaction." In that document, Ms. Holmes further acknowledged that she was estopped from claiming that the interest rate was excessive, harsh, or unconscionable.

[61] In the course of signing those acknowledgements, Ms. Holmes also executed the Mortgage Commitment Letter dated June 25, 2018, that set out the terms of the transaction. Ms. Holmes has not pleaded that the terms of the loan were unconscionable, or given evidence disagreeing with the contractual terms set out in that letter to oppose the motion.

[62] There is no evidence before the court from Ms. Karageorgievski, Mr. Maniaci or Sabine about the forebearance or waiver of fees, or about the charge for two months, twelve days of interest to support Ms. Holmes’ position that those amounts were wrongfully diverted or withheld from the proceeds. I am left to conclude on the evidentiary record that Ms. Karageorgievski gave Ms. Holmes independent advice before she signed the documents to borrow funds from, and to grant the charge to the Acquavivas.

[63] Ms. Holmes also acknowledged that she received the Standard Charge Terms 200033.

[64] Ms. Holmes signed the customary acknowledgment and direction directing the Acquavivas’ lawyer to register the charge.

[65] The Acknowledgement re Legal Representation in that respect is dispositive evidence of the fact that Ms. Holmes received independent legal advice about the transaction, about what she would receive out of it and the amount she would be required to repay. As the court explained in Mantella v. Mantella, at paragraph 39:

“But even in the unique and complex area of family law, a solicitor's duty is to her own client, and not to the other side. If the solicitor fails to provide competent legal advice, that is an issue for her own client. Where a solicitor certifies that she has provided independent legal advice, so far as the opposite party is concerned that should end the matter: non est factum will not be available unless the opposite party knew or was willfully blind to the fact that the other party did not understand the agreement. The solicitor's certification is dispositive evidence of comprehension on the part of the signatory, and not a representation from the solicitor herself to the opposite party.”

[66] There is insufficient evidence to find that Ms. Holmes was misled, or misunderstood how the mortgage commitment would work. Ms. Holmes has not put any evidence from Ms. Karageorgievski or any other person before the court to find a genuine issue about her understanding of the transaction. She had the ability and the resources to gather the information she now finds lacking.

[67] I therefore find on the balance of probabilities that Ms. Holmes granted the Acquaviva charge on an informed basis.

[68] The evidence Ms. Holmes has given about her previous dealings with Ms. Ngado and Ms. Omoregie in turn, as well as the arrangement for the Tatangelo charge in 2017, pre-dates the transaction and charge to the Acquavivas in 2018. This history does not raise any genuine issues requiring a trial of this action. If anything, it is evidence of the financial distress Ms. Holmes experienced during that time period, and the decisions she was making at the time because of it.

[69] The Acquavivas have satisfied the burden of showing there is no genuine issue requiring a trial for the court to find that there was no side deal or any agreement to avoid repayment of the amounts secured by the charge. The evidentiary burden then shifted to Ms. Holmes to show there is a genuine issue in that her defence has a real chance of success. She has not discharged that burden.

[70] Even if there was a collateral agreement, it would be improper for the court to consider such an agreement. Subject to the doctrine of surrounding circumstances, collateral agreements that are not in writing and inconsistent with the terms of a written agreement, are not admissible by operation of the parol evidence rule: Saatva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, at p. 59.

Proper Amount Owing

[71] In her main affidavit, Ms. Holmes swore that she did not receive the total amount of $720,000. She argues that the Acquavivas are not entitled to judgment on any amounts over and above those advanced. In particular, she challenges that part of the claim to repay the lender’s fee of $21,600.

[72] This court has upheld the validity of lender’s fees on a contractual basis where the parties have agreed upon those fees as part of the deal. See Stoney Creek v. 2459437 Ontario Inc., at para. 35.

[73] Rule 20.02(2) is clear that a defendant may not rely on allegations in the statement of defence, but must show specific facts that there is a genuine issue requiring a trial through evidence. Ms. Holmes has not set out specific facts in an affidavit or other evidence that the Acquavivas represented or agreed to return or waive the lender’s fee directly. Nor has Ms. Holmes provided evidence that Sabine made those representations to her as their alleged agent. She has not set out specific facts to substantiate the allegation that Sabine was acting as the Acquavivas’ agent at all to support that bald assertion made in her statement of defence or in argument on the motion.

[74] To the contrary, the evidence shows that Ms. Holmes sought out Sabine to assist her with financing the property, and that Sabine put her in touch with Prisila at the Maniaci law office. There is no evidence before this court that Sabine even knew, let alone gave Ms. Holmes reason to believe that she had actual or ostensible authority to speak on the Acquavivas’ behalf.

[75] I have no difficulty to find on the evidentiary record that Sabine never acted as agent for the Acquavivas when making representations to Ms. Holmes.

[76] If there is a legitimate dispute regarding the amount owing, it is not because of the lender’s fee to which Ms. Holmes agreed as the price to pay for sourcing the financing. Rather, it is the amount allocated to the account of Ms. Holmes under the Acquaviva charge that must be determined.

[77] When the funds from 262 and the Acquavivas were each deposited to the Maniaci trust account, they were mixed. The transactions shown in the trust ledger from Mr. Maniaci’s office marked as Exhibit #B.a to the affidavit of Cameron Smith, and the accounting of funds in and out of that trust account, are somewhat confusing as a result. In addition to lacking a coherent explanation as to what funds from which lender were applied to pay out the CIBC mortgage or distributed to other recipients, the evidence is unclear what fees, interest and expenses were withheld or deferred for payment until the face amount of the charge is paid.

[78] Cameron Smith is a law clerk in the office of the Acquavivas’ litigation counsel. Other documents attached to his affidavit in the Supplementary Motion Record that put the proper amount payable by Ms. Holmes in issue include:

a. 1st Mortgage Commitment dated June 25, 2018; b. Irrevocable Direction re Fees date June 25, 2018; c. (Draft) Statement of Advance re Direction re Funds dated June 26, 2018; and d. Discharge Statement (for the second mortgage to 262) as at June 29, 2018.

[79] If the evidence enables the court to reach a conclusion on liability with only the amount owing to determine, the court has the ability to order a hearing to enhance it’s fact finding powers under Rule 20.04(2.2) to determine if there is no genuine issue about the amount owing. The court may also grant summary judgment under Rule 20.04(3) where the only genuine issue is the amount owing, and then give directions on how that amount shall be determined. The difference between the two approaches is that in the first, the court may require oral evidence to determine whether there is no genuine issue requiring a trial for an issue related to liability or to damages to grant or refuse to grant summary judgment. In the second, the court grants summary judgment to a plaintiff having determined there is no genuine issue to find liability, leaving only the amount owing as the issue for trial on an articulated basis.

[80] This is not a complex matter. There is no need for a conventional trial at which liability and damages are in issue. Ms. Holmes acknowledges that the charge to the Acquavivas has matured, and that she has made no payments since July 2019. A dispute over the interpretation of the charge as to certain amounts owing should not deter the granting of judgment on the validity of the charge: Devi v. Everwood et al., 2021 ONSC 1968, at para 69.

[81] As the remaining question concerns the amount owing under the Acquaviva charge, this is an appropriate case for summary judgment. The amount owing remains the only issue for adjudication. The question of quantum can be answered after a trial with viva voce evidence under Rule 20.04(3).

Conclusion and Orders

[82] The motion for summary judgment is granted, except for the sole issue of determining the amount owing under the charge. The plaintiffs, Aurelio Acquaviva and Maria Acquaviva, shall have judgment that the charge is valid and enforceable.

[83] A trial is ordered at which the parties shall be at liberty to call evidence limited to the following issues:

a. What is the proper amount that was actually secured under the Acquaviva charge; and b. What interest rate is payable on the principal amount owing on the charge after July 1, 2019.

[84] The trial should only take one day, and may be conducted by video-conference. The parties shall file an affidavit for the evidence in chief of each witness they are calling, and produce that witness for cross-examination and to answer my questions. A timetable and other issues relating to the trial may be discussed at a case management conference that may be arranged through my judicial assistant by email at janet.gunness@ontario.ca.

[85] The Acquavivas also seek possession of 15 Quatro Crescent and leave to issue a writ of possession at this time.

[86] Under Rule 60.10, a party may obtain an order for leave to issue a writ of possession at the same time an order entitling a party to possession is granted.

[87] According to Section 10 of the Standard Charge Terms, the plaintiffs are entitled to possession.

[88] The court has the authority to grant leave to issue a writ of possession at the same time summary judgment is granted, as long as the court “is satisfied that all persons in actual possession of any part of the land have received sufficient notice of the proceeding in which the order was obtained to have enabled them to apply to the court for relief”: Marinic Estate v. Garner, 2019 ONSC 5771, at para. 50.

[89] After I hear further evidence to determine the proper amount owing under the charge, there is ample authority to grant the Acquavivas a Writ of Possession upon finding that they are entitled to possession of the property. No order for possession is being made by the court at this time.

[90] From a review of the Standard Charge Terms, there appears to be a basis for the Acquavivas to claim costs “as between solicitor and client” to enforce the charge, provided Ms. Holmes has not insulated herself with a strategic offer to settle. If she has not, those costs may further erode any equity she has built up in the property. I will not learn about the existence of any offer to settle or its terms until the motion is fully decided. Costs are therefore deferred to the outcome of the hearing under Rule 20.04(3).

Emery J. Released: March 1, 2022