DATE: 2004-03-12 DOCKET: C40265

COURT OF APPEAL FOR ONTARIO

RE:

THE ESTATE OF MERLINO MARIANO, by its Litigation Administrator, GLORIA MARIANO and GLORIA MARIANO, Personally (Plaintiffs (Respondents)) - and - CANADIAN IMPERIAL BANK OF COMMERCE and CLARICA LIFE INSURANCE COMPANY (Defendants (Appellants))

BEFORE:

McMURTRY C.J.O., MOLDAVER and CRONK JJ.A.

COUNSEL:

Chris Argiropoulos For the appellants

George Karahotzitis For the respondents

HEARD:

March 9, 2004

RELEASED ORALLY:

March 9, 2004

On appeal from the judgment of Justice Susan G. Himel dated June 3, 2003.

ENDORSEMENT

[1] We would allow the appeal and dismiss the cross-appeal.

[2] In our view, Himel J. was entitled to order judgment in accordance with the offer to settle. As for the issue of equitable set-off, we are not persuaded that she erred in permitting it in the circumstances. However, there was no evidentiary foundation to support, nor did Himel J. provide reasons for, the extinguishment of the remainder of the debt owing to the bank.

[3] Accordingly, the appeal is allowed and the cross-appeal is dismissed. Paragraph two of the judgment dated June 3, 2003 is varied to read as follows:

This court orders and adjudges that all of the monies paid pursuant to the offer to settle shall be used to set-off the indebtedness of the plaintiffs to the defendants.

[4] In the circumstances, we are of the view that the parties should bear their own costs.

Signed: "R. Roy McMurtry C.J.O." "M. J. Moldaver J.A." "E.A. Cronk J.A."