ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: 6029/10
DATE: 2012-05-22

B E T W E E N:

Zahra Maftoun

J. O’Sullivan, for the Plaintiff, Zahra Maftoun

Plaintiff

• and -

Seyed Hassan Banitaba, Mahmoud Zargar and Law Society of Upper Canada

J. Chahal, for the Defendant Mahmoud Zargar
H. Niroomand for the Defendant Seyed Hassan Banitaba

Defendants

HEARD: April 17, 18, 19, 20, 23, 24, 26, 27, 2012

REASONS FOR JUDGMENT

Ricchetti, J.

1The Law Society of Upper Canada, while named in the title of the proceedings, was not served with the Statement of Claim and was not a party to the trial in this action. No relief is sought or granted against the Law Society of Upper Canada.

Defendant's Summary Judgment Motion

2At the commencement of trial, the Defendants, Mahmoud Zargar (“Zargar”) and Seyed Hassan Banitaba (“Banitaba”), brought a motion under Rule 20 for a dismissal of Zahra Maftoun’s (“Maftoun”) action. The only basis advanced by the Defendants was that Maftoun's claims are statute barred by the Limitations Act , 2002 .

3Maftoun claims there are two causes of action:

a) The first cause of action arose when the Divorce Certificate (as described below) was altered after December 13, 1999 ("1999 Cause of Action"); and

b) the second cause of action arose when Banitaba and Zargar caused to be filed in the Iranian Proceedings (as described below), a certified copy of the altered Certified Divorce Register (as defined below) sometime between 2007 and 2010 ("2010 Cause of Action").

4With respect to the 1999 Cause of Action, Maftoun submits there is no applicable limitation period because the action is based in fraud. Alternatively, Maftoun submits that the 6 year limitation period was met by commencing the proceedings in Iran – culminating in a judgment in Maftoun’s favour in 2005.

5With respect to the 2010 Cause of Action, Maftoun submits the present action was commenced within the two year period from the time the Certified Divorce Register was discovered by Maftoun.

6Some of the relief sought by Maftoun in this action is for a declaration that she remains entitled to her marriage gift set out in her Marriage Contract and that the waiver in the allegedly altered Divorce Certificate and Register of the Divorce is null and void.

7S. 16 (1) (a) of the Limitations Act, 2002 , provides as follows:

16. (1) There is no limitation period in respect of,

(a) a proceeding for a declaration if no consequential relief is sought;

8Consequential relief is sought in this action.

9In Exhibit 1, Tab 8, there is a letter dated December 2, 2101 from the Iranian judiciary requesting answers to a number of queries from the Ontario courts on the validity of the waiver in the Divorce Certificate. A declaration would be responsive to this request.

10Let me now turn to the consequential relief sought by Maftoun. She seeks to enforce her Marriage Gift (as defined below) or recover damages suffered as a result of the alleged fraudulent insertion of the waiver after the execution of the Divorce Certificate and Register of the Divorce.

11The facts are complex in this case given the simultaneous Iranian Proceedings involving the same parties and same issue. The Iranian Proceedings continue and a final determination on the entitlement of Maftoun to the Marriage Gift or the validity of the waiver of the Marriage Gift has not been made.

12Maftoun submits that the allegations and the defences are best determined at trial where a "full appreciation" of the facts and defence can be assessed by the court.

13The proper approach on summary judgment motions was recently canvassed by the Court of Appeal in Combined Air Mechanical Services Inc. v. Flesch, 2011 ONCA 764. The Court of Appeal described the “full appreciation” test to be used on Rule 20 summary judgment motions as follows in paras. 55-56:

Thus, in deciding whether to use the powers in rule 20.04(2.1), the motion judge must consider if this is a case where meeting the full appreciation test requires an opportunity to hear and observe witnesses, to have the evidence presented by way of a trial narrative, and to experience the fact-finding process first-hand. Unless full appreciation of the evidence and issues that is required to make dispositive findings is attainable on the motion record – as may be supplemented by the presentation of oral evidence under rule 20.04(2.2) – the judge cannot be “satisfied” that the issues are appropriately resolved on a motion for summary judgment.

By adopting the full appreciation test, we continue to recognize the established principles regarding the evidentiary obligations on a summary judgment motion. The Supreme Court of Canada addressed this point in Lameman , at para. 11, where the court cited Sharpe J.’s reasons in Transamerica Life Insurance Co. of Canada v. Canada Life Assurance Co. , (1996), 28 O.R. (3d) 423 (Gen. Div.) , at p. 434, in support of the proposition that“[e]ach side must ‘put its best foot forward’ with respect to the existence or non-existence of material issues to be tried.” This obligation continues to apply under the amended Rule 20. On a motion for summary judgment, a party is not “entitled to sit back and rely on the possibility that more favourable facts may develop at trial”: Transamerica , at p. 434.

14In my view, the exact nature of Maftoun's claim, the defences raised (including the alleged limitation defence with respect to the 1999 and 2010 Causes of Action) and the relevance and importance of the Iranian proceedings can only be fully appreciated at trial, after hearing viva voce evidence and a careful consideration of the documentation. I could not state that, without a trial, there was no genuine issue requiring a trial.

15Banitaba and Zargar’s summary judgment motion was dismissed without prejudice to full argument on the limitations defence at the conclusion of trial.

The Iranian Proceedings

16As will be seen from the facts below, Maftoun and Zargar have been involved in legal proceedings in Iran for the past 7 to 8 years. At issue is the very same issue before this court – whether Maftoun is entitled to the Marriage Gift in her Marriage Contract or whether the waiver in the Divorce Certificate and/or Divorce Register is a valid release of Maftoun's entitlement to the Marriage Gift.

17There is no doubt Iran had jurisdiction over the subject matter before its courts given that the Marriage Contract was entered into in Iran, registered in Iran and the Divorce Certificate in question was for the purpose of registration with Iran.

18Counsel agree that no final order has been made in the Iranian proceedings.

19Surprisingly, neither of the defendants sought a stay of this action. All counsel indicated they wanted this court to decide the issues in this action. Had an order been sought staying this action, an order staying this action would likely have been granted given that the main parties have attorned to the jurisdiction of Iran to determine the very issue this court must decide and, execution on the Iranian judgment, if Maftoun is successful, has already occurred in Iran.

20Given the request by the Iranian judiciary with respect to the waiver of the Marriage Gift in the Divorce Certificate, that none of the defendants sought a stay of this action and that all counsel want this action decided, this court will hear and decide the claims in this action on the merits and defences raised .

(continues verbatim as in source)

Original signed “Ricchetti J.”

Ricchetti, J.