SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: CV-12-45051

MOTION HEARD: August 19, 2013, September 6, 2013 and September 10, 2013

RE: J.B. Aluminium Products Limited c.o.b. J.B. Aluminum Products Ltd. (Plaintiff) v. CL Commercial Inc., 2207054 Ontario Inc. (“220”), Aracelis Holdings Inc. (“Aracelis”), Continental Investment Group Ltd. (“Continental”), Gedasa Investments Inc. (“Gedasa”), Giuseppe Correale, Lina Correale and Rosa Lecce (Defendants);

BEFORE: Master C. Wiebe;

COUNSEL: Greg Hemsworth for 220, Aracelis, Continental, Gedasa, Giuseppe Correale, Lina Correale and Rosa Lecce (the “Mortgagees”); Fernando Souza for the lien claimants, Extreme Electrical Services Limited (“Extreme”) and E-M Air Systems Inc. (“E-M Air”);

Damon Stoddard for the lien claimant, J.B. Aluminum Products Limited (“J.B. Aluminum”);

Rob Moubarak for the lien claimant, Tony Battista Paving Inc. (“Battista”);

Adam Wainstock for lien claimant, 2164705 Ontario Inc. (“216”).

COSTS DECISION

[1] This motion was originally brought by the Mortgagees on short notice on August 19, 2013 for an order vacating the liens from the title to all units upon the posting of cash security in the amount of 20% of the contract prices of the remaining lien claims. At the hearing of the motion, counsel for the Mortgagees advised the court that the Mortgagees was now proposing in addition that the remaining lien claims remain on the titles of the 5 units that would not be sold. I adjourned the motion in order to allow the lien claimants to get instructions.

[2] On September 6, 2013 I heard further argument. I reserved my ruling, and then convened a telephone case conference on September 10, 2013 to hear final submissions. I accepted the Mortgagees revised proposal for posting reduced security at this time. I reduced my ruling to written reasons which I released on September 16, 2013.

[3] I have now received and reviewed the written costs submissions of counsel for the Mortgagees and the lien claimants, 2164750 Ontario Inc. o/a Sitescape, E-M Air Systems Inc. and Extreme Electrical Services Inc. The Mortgagees seek partial indemnity costs in the total amount of $7,726.30. The said lien claimants want an award of no costs or an award of costs in the cause or an award of minimal costs.

[4] After reviewing these submissions and the motion itself, I have decided not to award costs on this motion for the following reasons:

a) The Mortgagees short served their original motion, thereby leading to an adjournment to allow the lien claimants to get instructions.

b) The Mortgagees did not seek the relief that was eventually ordered in their original motion material. The order resulted from a compromise proposal raised by the Mortgagees at the hearing of the motion. The result was therefore of mixed success.

c) The Mortgagees could have exercised the option of posting a section 78(10) bond with the Registrar, which would have required no motion. They chose not to do so because, I understand, they could not get these bonds in sufficient time to close the transactions and because the agreements of purchase and sale would have had to be renegotiated in that event, all of which was no fault of the lien claimants. The Mortgagees could also have moved under section 44(1) without notice. Instead, they chose to move on notice for a novel form of reduced security under section 44(2). The section 44(2) motion was, therefore, by choice of the Mortgagees and was in essence an accommodation to them.

d) The reduced security in the end was in a form that is quite novel. No cases were put before me that concerned such a form of reduced security. Therefore, I find that the lien claimants’ resistance to the motion was not unreasonable.

e) Furthermore, the lien claimants acted not unreasonably in trying to resolve the motion by proposing alternative orders that were not the entirety of the security required by section 44(1) and that involved the payment of cash security from the sale proceeds, not payment up front.

f) Finally, the motion was important for all parties, but most particularly for the Mortgagees and on account of their own conduct. They had undertaken power of sale proceedings and had entered into agreements of purchase and sale with closing dates that were imminent, all before bringing this motion.

[5] Therefore, I herewith order that there be no costs award on this motion.

MASTER C. WIEBE

DATE: October 23, 2013