DATE: 20010316
DOCKET: M26591/C34461
COURT OF APPEAL FOR ONTARIO
OSBORNE A.C.J.O., LASKIN and FELDMAN JJ.A.
BETWEEN:
John F.L. Rose
HAZEL HOLMES
for the appellant
Plaintiff/Appellant
- and -
Martin J. Prost
ALFRED ROY MAYER
for the respondent
Defendant/Respondent
- AND -
ALFRED ROY MAYER
Plaintiff by
Counterclaim
- and -
HAZEL HOLMES, ELAINE GARBE,
Heard: January 29, 2001
ALFRED GARBE, FRANK RANVILLE
And CHRISTOPHER RANVILLE
Defendants to
Counterclaim
On appeal from the judgment of Justice Margaret P. Eberhard, dated May 15, 2000.
BY THE COURT:
[1] The appellant, Hazel Holmes, by notice of appeal dated June 20, 2000, appealed the judgment of Madam Justice Eberhard, dated May 15, 2000. Before the appeal was perfected, we were advised that the parties had settled their dispute. Further to that settlement, counsel for the appellant and the respondent jointly moved to implement the settlement. They sought to have the appeal allowed in part by amending paragraph 3 of the judgment of Justice Eberhard to reflect that a mortgage from the appellant to Alfred and Elaine Garbe be set aside, but only in respect of the appellant and respondent.
[2] Some brief reference to the facts will explain the circumstances with which we are now confronted. Hazel Holmes and Alfred Roy Mayer lived together in an “on again off again” relationship from 1976 to 1992. They separated for a period in 1988 during which Holmes purchased a residence at 495 Barnes Avenue in Port McNicoll, Ontario. Holmes mortgaged 495 Barnes Avenue to the Garbes in February 1993. On May 6, 1997, Mayer secured a judgment against Holmes. He was immediately presented with problems in enforcing that judgment because the Garbe mortgage substantially reduced Holmes’ equity in the property. In due course, through somewhat tangled proceedings which included an appeal to this court, the mortgage from Holmes to the Garbes was declared null and void. The motions judge made this clear in her reasons. She said:
There can be no doubt that the Garbe claim is founded upon a fraudulent shared intention between Holmes and Garbe to put her assets out of Mr. Mayer’s reach. … Accordingly, I find that Mayer has succeeded in his personal capacity for a declaration that by reason of fraud, the bankrupt’s debt to him has not been released by her order of discharge. Further, Mr. Mayer has demonstrated … that the Garbe mortgage has no validity. It was a ruse from the beginning. I therefore declare that it is null and void and should be set aside and Mr. Mayer is entitled to sell the property and retain and dispose of the proceeds of the sale in a manner set out in the s. 38 order, free and clear of any claim in respect of that mortgage. [Emphasis added.]
[3] The motions judge’s reasons as set out above were reflected in the formal order that was entered. It is from that order that Holmes’ appeal was taken.
[4] The parties wish to modify the declaration issued by Eberhard J. so that the destiny of the mortgage as fraudulent, void and of no force and effect will be somewhat diluted. They propose to have the order, as amended, read:
THIS COURT DECLARES that for purpose of this sale, and only as between the parties, and not as between other secured creditors, the mortgage from Hazel Vaillancourt to Alfred Garbe and Elaine Garbe registered against the said property on 10 February 1993, as instrument No. 1213704 is null and void and is hereby set aside. [The emphasized words did not appear in the order under appeal.]
[5] When we first reviewed this matter, we expressed some concern about other creditors, (there being at least one – Legal Aid), that might be affected by the amendment sought. Simply put, if the Garbe mortgage is declared null and void, but only as between Holmes and Mayer, it would remain valid with respect to the claims of other secured creditors.
[6] Given the clearly written reasons of Eberhard J., it seems to us that she meant what she said, that is to say that the mortgage is null and void, not just null and void as between Holmes and Mayer. However, if the parties are correct in stating that it was Eberhard J.’s intention to restrict her references to the status of the mortgage to the parties, they could consider bringing a motion before Eberhard J. to vary or amend her order (see Rules 37.14 and 59.06). Another way to approach the problem would be to obtain the consent of all parties who might have an interest in the status of the Holmes-Garbe mortgage.
[7] We do not think that it would be proper for this court to intervene on the basis of the material placed before us. The rights of creditors, such as Legal Aid, that have an interest might well be compromised by the proposed settlement. The motion to implement the settlement is therefore dismissed. No costs.
“C.A. Osborne A.C.J.O.”
“John I. Laskin J.A.”
“K. Feldman J.A.”