DATE: 20020218 DOCKET: C36283

COURT OF APPEAL FOR ONTARIO

RE:

CLARICA TRUST COMPANY (Plaintiff/Appellant) v. ANGELA COLANGELO and ANGELO COLANGELO (Defendants/Respondents)

BEFORE:

FINLAYSON, CARTHY and CRONK JJ.A.

COUNSEL:

Sean E. Cumming

for the appellant

Paul J. Sullivan, Q.C.

for the respondents

HEARD:

February 13, 2002

On appeal from judgment of Justice Gerald F. Day dated April 12, 2001.

E N D O R S E M E N T

Released Orally: February 13, 2002

[1] We see no reason to interfere with the conclusion of the motions judge that the solicitor acted for the appellant on the entirety of a single loan transaction. This is borne out by the single mortgage commitment, and the letters of instruction delivered to the solicitor by MCAP Mortgage Corp. Further, the creditor’s requirement that the debtors execute in advance of closing an irrevocable direction and assignment in a form dictated by the creditor was designed to ensure that the borrowers could not access the proceeds of the bridge financing loan and was effective for that purpose.

[2] In these circumstances, where the solicitor was acting both for the creditor and the borrowers, his receipt of the $90,000 in issue was receipt on behalf of the creditor.

[3] The respondents rely on the appellant’s conduct in the action to justify the award made by the motions judge of solicitor and client costs for the action and the motions below, but the motions judge gave no reasons to support such an award. We cannot assume that there was evidence to warrant such an award and we heard no submission which satisfies us that such an award was supportable in the circumstances.

[4] Accordingly, the appeal is allowed in part, to vary the order of the motions judge by deleting the award of solicitor and client costs and substituting in its stead an order for costs in the amount of $5,000 on a party and party basis.

[5] The appeal is otherwise dismissed. The respondents are entitled to their costs of the appeal, fixed in the amount of $5,000.

“G.R. Finlayson J.A.”

“J.J. Carthy J.A.”

“E.A. Cronk J.A.”