SUPERIOR COURT OF JUSTICE - ONTARIO

Court File No.: 01-CV-222743
Motion Heard: 2012-03-07

RE: Greenbanktree Power Corporation, Applicant

AND:

Coinamatic Canada Inc. et al., Respondents

BEFORE: Master McAfee

COUNSEL:
J. A. Campion and R. Butler, Counsel for the Moving Party, the Respondent, Metcap Living Management Inc.

R. B. Moldaver Q.C., Counsel for the Responding Party, the Applicant, Greenbanktree Power Corporation

HEARD: March 7, 2012

REASONS FOR DECISION

[ 1 ] This is a motion brought by the respondent, Metcap Living Management Inc. for an order dismissing the relief sought by the applicant, Greenbanktree Power Corporation in Greenbanktree’s notice of hearing for directions and timetable dated May 30, 2011, an order that this court lacks jurisdiction to hold the reference and other relief.

[ 2 ] On December 31, 2001, Greenbanktree brought an application for an order for the sale of certain lands pursuant to subsection 3(1) of the Partition Act , R.S.O. 1990, c.P.4 and Rules 54 and 66 of the Rules of Civil Procedure .

[ 3 ] On May 2, 2002, Justice Pitt granted Greenbanktree’s application for the sale of the lands under the Partition Act . The judgment for sale was in Form 66A and ordered that the properties be sold under the direction of a referee. The judgment for sale ordered in part that:

(a) All necessary inquiries be made, accounts taken, costs assessed and steps taken by the master for the sale of the lands;

(b) The lands, or such part of it as the referees thinks fit, be sold under the direction of the referee and the purchaser pay the purchase money into court for the credit of this proceeding.

[ 4 ] Metcap appealed the judgment for sale.

[ 5 ] On or about December 13, 2002, Greenbanktree registered the judgment for sale on title to the properties.

[ 6 ] On or about June 11, 2003, Metcap’s appeal from the judgment for sale was heard in the Divisional Court. The appeal was dismissed on October 6, 2003.

[ 7 ] On January 29, 2004, Metcap was granted leave to appeal to the Court of Appeal from the decision of the Divisional Court.

[ 8 ] On December 21, 2004, Metcap’s appeal to the Court of Appeal was dismissed.

[ 9 ] On or about March 15, 2004, the El-Ad Group purchased Metcap’s majority co-ownership interest in the properties.

[ 10 ] Master Linton was assigned to hear the reference. On or about May 1, 2006, Master Linton heard a motion with reasons released on May 9, 2006. Thereafter it does not appear that any party contacted Master Linton further. Other than an unsuccessful appeal by Metcap of Master Linton’s order, the reference did not proceed further.

[ 11 ] On or about June 18, 2010, Greenbanktree elected to privately sell its entire co-ownership interest in the properties to the El-Ad Group. As a result of the private sale, El-Ad owned 100 percent of the properties.

[ 12 ] Despite having carriage for the reference pursuant to the judgment for sale and being subject to management of the reference master, Greenbanktree did not advise the court or Metcap that it was preparing to sell and had sold its ownership interest in the properties. The proceeds of the private sale were not paid into court contrary to the judgment for sale.

[ 13 ] The sale was accomplished by way of memorandum of agreement between Greenbanktree and El-Ad. The memorandum of agreement sets out the terms for the private sale including the fact that Greenbanktree and El-Ad agreed to waive any adjustments in respect of the agreed to purchase price.

[ 14 ] On June 18, 2010, the judgment for sale was deleted from title to the properties. The instrument used to delete the judgment for sale from title stated that the judgment for sale was “…no longer required and the registered owners of the properties described herein have consented to the deletion thereof from each of the properties described herein.”

[ 15 ] El-Ad subsequently sold its ownership interest in all but one of the properties to third parties.

[ 16 ] On or about April 26, 2011, Greenbanktree requested the appointment of another reference master due to the retirement of Master Linton. I was appointed the reference master by the team leader for masters. On a case conference the within motion of Metcap and the hearing for directions of Greenbanktree were scheduled.

[ 17 ] Notwithstanding that the properties have been sold privately and not in accordance with the judgment for sale, Greenbanktree seeks to proceed with the reference with respect to certain issues as between Greenbanktree and Metcap only.

[ 18 ] The issue on this motion is whether, as a result of the private sale, the reference master has jurisdiction to proceed with the reference as set out in the judgment for sale.

[ 19 ] Greenbanktree admits that it did not comply with the judgment of sale. In its materials filed for the hearing for directions Greenbanktree states that as a result of the private sale, it has “…ma[d]e moot the reference to determine the conditions of sale and related matters thereto as between El-Ad Group and Greenbanktree” (see affidavit of M. Johnson sworn May 30, 2011 at para 9).

[ 20 ] In my view, as a result of the private sale and Greenbanktree’s decision not to proceed with the sale of the properties in accordance with the terms of the judgment for sale, the judgment for sale is unenforceable. Greenbanktree did not obtain a right to any form of sale, a partial sale or to an accounting without a sale. Greenbanktree sought and obtained a right to a sale of the properties under the Partition Act and Rules of Civil Procedure .

[ 21 ] In my view, having made an application for sale under the Partition Act and Rules of Civil Procedure and having obtained judgment for sale, Greenbanktree may not pick and choose between those portions of the judgment for sale that it wishes to pursue.

[ 22 ] The judgment for sale is the sole jurisdiction for the reference. As a result of the private sale, as reference master, I lack the jurisdiction to proceed with the reference in the terms set forth in the judgment for sale. A master has no jurisdiction to amend the judgment for sale (see Rule 37.02(2)(b)).

[ 23 ] Accordingly, I find that this court lacks the jurisdiction to proceed with the reference in the terms set forth in the judgment for sale.

[ 24 ] If any party requests costs and if costs cannot be agreed upon, the parties may make arrangements to speak to the issue of costs.

Master McAfee

Date: August 7, 2012