Court File and Parties

CITATION: Kelland v. Hardestine Holdings Limited, 2008 ONCA 99

DATE: 20080213

DOCKET: M35865 (C47917)

COURT OF APPEAL FOR ONTARIO

WATT J.A. (In-Chambers)

BETWEEN:

PAUL KELLAND Plaintiff (Respondent/Responding Party)

and

HARDESTINE HOLDINGS LIMITED Defendant (Appellant/Moving Party)

COUNSEL: K. William McKenzie for the moving party Matthew Diskin for the responding party

Heard: January 30, 2008

On appeal from the order of Justice John R. McIssac of the Superior Court of Justice dated October 24, 2007, on a motion for direction.

ENDORSEMENT

A. Background

[1] Kelland, the registered owner of a parcel of land in Simcoe County, commenced an action against Hardestine, the holder of several mortgages on the property. Amongst other relief, Kelland sought a declaration that the mortgage contracts have been performed and that Hardestine no longer retains any right to possession of the property.

[2] Hardestine was not served personally with the Statement of Claim and a copy sent by mail was not dispatched to the company’s mailing address recorded in the Corporation Profile Report maintained by the Ministry of Consumer and Business Services.

[3] Hardestine did not file a Statement of Defence within prescribed time limits. Kelland noted default on September 11, 2006. By the end of November, 2006, Kelland had issued an Amended Statement of Claim and obtained orders discharging the mortgages on the property and awarding him possession of the mortgaged property.

[4] Hardestine obtained a copy of the Amended Statement of Claim and served a Statement of Defence and Counterclaim on December 4, 2006.

[5] On December 7, 2006 Kelland obtained leave to further amend the Amended Statement of Claim to correct mistakes in the description of various instruments registered against the property.

[6] On December 11, 2006, Hardestine moved to set aside the noting of default, and sought to set aside or stay the subsequent orders discharging the mortgages and awarding possession of the property to Kelland.

[7] On August 14, 2007 Hardestine’s motion was heard and judgment reserved. On October 24, 2007, the motions judge dismissed Hardestine’s motion. On November 5, 2007, Hardestine filed a notice of appeal from the decision of the motions judge.

[8] On December 3, 2007 Hardestine served and filed the material necessary to perfect the appeal. Two days later, the Court of Appeal office returned the materials filed to Hardestine’s solicitor. Several deficiencies were noted in the filing, including but not only the omission of a copy of the order appealed from as signed, issued and entered.

[9] On December 10, 2007 the Registrar imposed a deadline of January 1, 2008 for Hardestine to perfect the appeal. On the same day, Hardestine’s solicitor received an approved draft order from Kelland’s solicitor. Four days later, an agent for Hardestine’s solicitor filed the order in the office of Superior Court of Justice for entry and issue.

[10] On December 20, 2007 Hardestine brought this motion, returnable January 9, 2008. To convenience counsel for Kelland, the motion was adjourned for hearing until January 30, 2008.

B. The Relief Sought

[11] The principal relief Hardestine seeks is an order extending the time within which it may perfect the appeal, but it also wants a stay of all judgments issued by judges of the Superior Court after Hardestine had been noted in default, as well as an order extending the time within which to appeal the underlying default orders and judgements. And finally, Hardestine seeks directions about inclusion in the its Appeal Book and Compendium of material not before the motions judge whose order is the subject of the appeal.

C. Discussion

1. The Uncontroverted Ground

[12] As the argument of the motion progressed, the controverted ground narrowed.

[13] On behalf of Kelland, Mr. Diskin has undertaken not to register on title the discharges of the mortgages until final determination of Hardestine’s appeal. Mr. Diskin has also agreed to permit Hardestine to include in their Appeal Book and Compendium materials before judges who had ordered discharge of the mortgages and delivery of possession of the property. These materials were not before the motions judge whose order is under appeal. Mr. Diskin reserves the right to challenge the inclusion of these materials before the panel hearing the appeal on the ground that these materials constitute fresh or further evidence that does not satisfy the test for admission on appeal.

2. The Extension of Time for Perfection

[14] Hardestine formed the intention to appeal in a timely way and executed its intention by filing the notice of appeal within the required time. A month after filing the notice of appeal and Exhibit Book, Hardestine filed its Appeal Book and Compendium, as well as its Factum, in an attempt to perfect the appeal. The filings were deficient, in part because the court order reflecting the outcome of the proceedings under of the appeal had not been drafted, approved, entered and issued.

[15] Shortly after the return of Hardestine’s materials with their deficiencies noted, the Registrar directed that the appeal be perfected by year end, a period of about three weeks. The deficiencies were scarcely overwhelming, easily conquered despite the impending holiday season and inevitable Simcoe County snow storms, the reasons advanced for Hardestine’s failure to perfect. Indeed, the time spent to prepare the motion would probably have surpassed what was needed to rectify the deficiencies and perfect the appeal.

[16] The notice of appeal recites factual and legal errors on the part of the motions judge in three respects:

i. in finding that Hardestine had been properly served with the Statement of Claim;

ii. in finding that Hardestine “advertently decided to ignore the Statement of Claim”; and

iii. in finding that Hardestine was not permitted to deliver a Defence to the Amended Statement of Claim.

[17] While I do not doubt the difficulty Hardestine faces in achieving appellate success, neither can I say that the appeal is totally devoid of merit.

[18] The extension Hardestine seeks is of brief duration. It relates to compliance with a procedural requirement, once attempted in a timely way but found deficient. Doubtless, Hardestine should have concentrated its efforts on perfection of the appeal, rather than generation of another motion – in hindsight, a dubious choice, with little upside. That said, I am not prepared to deny Hardestine an extension of time within which to perfect its appeal.

D. Conclusion

[19] The time within which Hardestine is to perfect its appeal is extended to the close of business on February 29, 2008.

[20] The parties may file written submissions on costs of this motion by February 15, 2008 (Hardestine) and February 19, 2008 (Kelland), respectively. In the absence of any submissions, the costs of this motion shall be reserved to the panel hearing the appeal.

“David Watt J.A.”