Court of Appeal for Ontario

Date: 20230306 Docket: C70895

Before: Roberts, Nordheimer and Favreau JJ.A.

Between: Leslie Rivas, Plaintiff (Appellant)

And: Michael Anobile, Defendant (Respondent)

Counsel: Doug LaFramboise, for the appellant Domenic Saverino, for the respondent

Heard: March 3, 2023

On appeal from the judgment of Justice John R. McCarthy of the Superior Court of Justice, dated June 9, 2022, with reasons reported at 2022 ONSC 3446

Reasons for Decision

[1] Leslie Rivas appeals from the judgment of the trial judge who dismissed her claim for damages arising from events surrounding the property located at 99 Bestview Crescent, Vaughan, Ontario (the “Property”). [1] At the conclusion of the hearing, we dismissed the appeal with reasons to follow. These are our reasons.

[2] The appellant and her spouse were experiencing marital problems in the spring of 2013. The couple owned the Property as their matrimonial home. The appellant wished to remain at the Property with her children. She was facing financing problems.

[3] The appellant and the respondent were neighbours and friends. They entered into an unconventional type of business/trust arrangement. The appellant agreed to transfer the Property to the respondent. The respondent agreed to hold the Property in trust for the appellant while he attempted to secure better financing. The appellant would continue to reside at the Property.

[4] The Property was transferred twice. The parties entered into an agreement of purchase and sale for the first transfer. The parties also set up a joint bank account. The transaction closed. The respondent paid for the Property by paying off certain existing mortgages and replacing them with new mortgages. He also assisted the appellant with her expenses by providing her with other funds.

[5] For the next two years, the appellant resided in the Property with her children. She was responsible for the mortgage payments and all expenses. The ongoing burden of mortgage payments and expenses caused the parties to discuss selling the Property on the open market. The Property was listed for sale in August 2015. It was sold shortly after to a third-party purchaser (i.e. the second transfer).

[6] The appellant alleges that she was defrauded of her equity in the Property through these events. She alleges that, not only did she lose her equity in the Property at the time that it was sold, but that she also lost the increase in equity that arose from the fact that the Property subsequently increased in value after the second transfer. Her total claim exceeds $500,000 in damages.

[7] The trial judge rejected the appellant’s claim. He made adverse credibility findings regarding her evidence. He also found that the arrangements with the respondent benefited the appellant in several ways, including by reducing the costs of carrying the Property by replacing existing high interest mortgages with loans at better rates of interest and, most importantly, permitting her and her children to continue to reside at the Property when she otherwise would likely not have been able to afford to do so. The trial judge further found that the appellant was consistently aware of all of the dealings involving the Property, including the loans and encumbrances affecting the Property.

[8] The trial judge did find that the respondent was in a position of trust with respect to the appellant and, thus, owed her fiduciary duties. However, the trial judge did not find that there had been any breach of those fiduciary duties. Nevertheless, the trial judge was critical of the respondent’s conduct in certain respects.

[9] Finally, the trial judge found that, even if there had been a breach of the fiduciary duties owed, the appellant had not suffered any damages arising from any breach. In his reasons, the trial judge detailed the receipt and disbursal of all of the monies relating to both transfers of the Property.

[10] On appeal, the appellant essentially tries to reverse the factual findings made by the trial judge. She fails in that effort. All of the findings made by the trial judge were available to him on the record. The appellant also submits that the trial judge did not properly apply summary judgment principles, but this was not a summary judgment motion. It was a form of summary trial as had been ordered by a case management judge. The trial judge received evidence by way of affidavit and oral evidence. After the close of evidence, the parties provided written submissions.

[11] The appellant has failed to establish any error made by the trial judge in his analysis and conclusion or his accounting of the funds. The submission that the appellant ought to have received independent legal advice (beyond what advice she did receive) fails in light of the trial judge’s finding that the appellant was a “willing participant and partner” in the parties’ agreement and was “consistently aware of…all the dealings involving the property”. This finding negates any suggestion that the appellant did not participate voluntarily or that she was under any duress.

[12] It is for these reasons that the appeal was dismissed. The respondent is entitled to his costs of the appeal fixed in the amount of $10,000, inclusive of disbursements and HST.

“L.B. Roberts J.A.”

“I.V.B. Nordheimer J.A.”

“L. Favreau J.A.”

[1] The judgment is improperly styled as an order in the formal document.