COURT OF APPEAL FOR ONTARIO

DATE: 20060918

DOCKET: C44507

RE: 2021977 ONTARIO INC. (Respondent (Applicant)) v. SHADAMY HOLDINGS COMPANY LIMITED (Appellant (Respondent))

BEFORE: O’CONNOR A.C.J.O., CRONK and LANG JJ.A.

COUNSEL: Burton Tait, Q.C. for the appellant

Lianne J. Armstrong for the respondent

HEARD: September 13, 2006 RELEASED ORALLY: September 13, 2006

On appeal from the judgment of Justice W.A. Jenkins of the Superior Court of Justice dated November 2, 2005.

E N D O R S E M E N T

[1] The appellant’s interest in the insurance proceeds was as collateral security for its mortgage. The appellant’s interest under the mortgage was extinguished when the property was transferred to it.

[2] We do not accept the appellant’s submission that the parties entered into an agreement with respect to the use of the insurance proceeds that would entitle the appellant to receive amounts in excess of the mortgage debt. We agree with the application judge that, on the record before him, the transfer of the property to the appellant was sufficient to satisfy the balance outstanding on the mortgage. Thus, the appellant did not continue to have an interest in the remaining funds.

[3] The appeal, therefore, is dismissed.

[4] The respondent is entitled to its costs of the appeal, fixed in the amount of $5,478.84, inclusive of disbursements and GST.

“Dennis O’Connor A.C.J.O.”

“E.A. Cronk J.A.”

“S.E. Lang J.A.”