Court of Appeal for Ontario

Robson Estate v. Robson

Date: 2002-01-18

Docket: CA C37584

Counsel: William J. Meyer, Q.C., for Appellant, Cellex-C International Inc. and as Agent for Jane Demaray for Appellant, Anti-Aging Holdings Ltd., RX Paul Robson for himself and for Appellant, RX Corporation H. David, D. Caprio, for Respondent, Tessis & Partners

Feldman J.A.:

[1] The appellants (defendants in the action) have filed a Notice of Appeal to the Court of Appeal from an order made by Spence J. for reasons delivered on January 17, 2002 (yesterday). The defendants had moved before Spence J. for an order declaring the action against them a nullity and beyond the jurisdiction of the Bankruptcy Court and because three of the defendants are strangers to the Bankruptcy, not properly brought before the court.

[2] Spence J. dismissed the motion. The appellants have appealed under subsections 193(a) and (c) of the Bankruptcy and Insolvency Act which section sets out the circumstances when an order or decision made in a bankruptcy case can be appealed to the Court of Appeal. Upon receipt of the reasons of Spence J., the respondent/plaintiff took the position with the defendants that s. 195 of the Bankruptcy and Insolvency Act did not have the effect of staying the trial of the action scheduled to commence on Monday, January 21st. The appellants thereupon sought to move on short notice before this court, in chambers, for an order in effect declaring that the proceedings scheduled to proceed on Monday are stayed under s. 195 as a result of the filing of the Notice of Appeal.

[3] The first issue raised was this court's jurisdiction or authority to make the order requested and whether the motion should have been brought to the Bankruptcy judge. Although two similar cases referred to in Houlden and Morawetz, Annotated Bankruptcy and Insolvency Act, 2002, p. 739 (I§37 — Effect of Appeal): Pesant, Re (1961), 4 C.B.R. (N.S.) 14 (Que. S.C.) and Claude Resources Inc., Re (1993), 1993 8813 (SK QB), 22 C.B.R. (3d) 272 (Sask. Q.B.) were both decisions of superior court judges, I am not satisfied that it is not this court that has the authority to interpret and apply ss. 193 and 195 as they relate to motions in this court. I refer by analogy to the decision of Finlayson J.A. in chambers, in Kiani v. Abdullah (1989), 1989 4352 (ON CA), 70 O.R. (2d) 697 (Ont. CA.) where he determined whether the automatic stay under Rule 63.01 applied in that case. I also refer to the decision of Catzman J.A. in TFP Investments Inc. (Trustee of) v. Singhal (1991), 3 C.B.R. (3d) 225 (Ont. C.A.)where Catzman J.A. sitting in chambers, made a determination as to the applicability of subsections 193(a) and (c) of the BIA.

[4] The substantive issue in the case is the effect and application of ss. 193 and 195 to the facts of this case. The appellants submit that their right to appeal the order of Spence J. is based on subsections 193(a) and (c), that the point at issue involves future rights and the property involved in the appeal exceeds $10,000 in value. The appellants argued that once they filed the Notice of Appeal, then under s. 195 "all proceedings under an order or judgment appealed from shall be stayed until the appeal is disposed of.

[5] Because of the broad nature of the stay imposed by s. 195, the rights of appeal without leave under subsection 193(a) or (c) must be clearly applicable. In my view the order sought to be appealed does not involve future rights, rather it involves the present rights of the appellants. I also am inclined to the view that this is not a case where the property involved in the appeal exceeds a value of $10,000. Although the shares sought by the plaintiff in the action do exceed $10,000 in value, the order itself does not deal with that property directly. See TFP Investments Inc. (Trustee of) v. Singhal, supra at p. 229. In that case Catzman J.A. came to a similar conclusion and pointed out that because he was sitting in chambers, his conclusion was not the final decision of the court on the issue. That decision could only be made by the panel hearing the appeal or a motion to quash. (para 11, p. 230)

[6] For the purpose of this motion, I am not satisfied that the appellants have the right to appeal without leave under subsection 193(a) or (c) of the Bankruptcy and Insolvency Act. Therefore, the s. 195 stay does not take effect.

[7] As a result the motion is dismissed. However, this disposition is without prejudice to the entitlement of: (a) the moving parties, if so advised, to move on proper material for leave to appeal the decision of Spence J.; (b) the responding party, if so advised, to seek an order varying or cancelling the consequent stay, if leave is granted; or (c) the responding party, if so advised, to move to quash the appeal.

Motion dismissed.