ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: 14-CV-498466

DATE: 20140311

BETWEEN:

FARHANA SULTANA KHAN
Applicant

– and –

MASHUQUAL HUQ CHOWDHURY
Respondent

David R. Carter and Chadi Yehia, for the Applicant

James Jagtoo, for the Respondent
Jeffrey Kukla, for the Royal Bank of Canada

HEARD: March 6, 2014

Perell, J.

REASONS FOR DECISION

A. INTRODUCTION

[1] The Royal Bank of Canada, which is not a party to the two Applications now before the court, has commenced mortgage power of sale proceedings against a property municipally known as 92-A Cedar Brae Boulevard in Toronto. The property is registered in the name of the Respondent, Mashuqual Huq Chowdhury, and the Bank has obtained a writ of possession, and it has served a notice to vacate on the occupants of the property.

[2] The Applicant, Farhana Sultana Khan, brings an application for: (a) an order declaring that the 92-A Cedar Brae Blvd. property is her matrimonial home; (b) an order that without the consent of Mr. Chowdhury, the property be mortgaged to Razer Capital Corporation; and (c) that the Order made in Royal Bank of Canada v. Chowdhury (in CV-13-42905), which granted the Royal Bank a writ of possession, be stayed. Ms. Khan wishes to use the proceeds from the Razer Capital mortgage to bring the Royal Bank’s mortgage into good standing.

[3] Mr. Chowdhury resists the Application, and he brings a cross-Application of his own.

[4] Mr. Chowdhury disputes that the 92-A Cedar Brae Blvd. property is a matrimonial home. He admits that he had a religious marriage and has three children with Ms. Khan, but he denies that she is his married spouse under the Family Law Act, R.S.O. 1990, c. F.3. First, he disputes that Ms. Khan, who had a prior marriage in Bangladesh, was a divorcee at the time of her religious marriage to him. Second, he says that if she had the capacity to marry him, she has not proven that the marriage ceremony in which he participated with her in Bangladesh should be recognized as a marriage in Ontario. On either account, Mr. Chowdhury says that she is not a “spouse” for the purposes of asserting an interest in the alleged matrimonial home under Part II of the Family Law Act.

[5] Mr. Chowdhury also submits that should it be found that he and Ms. Khan are spouses under the Act, then the 92-A Cedar Brae Blvd. property was not a matrimonial home at the time of his separation from Ms. Khan. As a further alternative, he submits that she has waived in writing any claim to the 92-A Cedar Brae Blvd. property.

[6] In his cross-Application, Mr. Chowdhury seeks: (a) an order cancelling a matrimonial designation registered by Ms. Khan in February 7, 2012 on the 92-A Cedar Brae Blvd. property; (b) an order for vacant possession of the property so that he can refinance or sell the property; and (c) an order facilitating his re-entry into the property to recover his business equipment located there.

[7] At the court’s request, the Royal Bank kindly agreed to delay its mortgage enforcement proceedings to permit the court to hear both Applications, which were heard on March 6, 2014, and the Bank further voluntarily agreed not to take any steps until after April 5, 2014.

[8] For the reasons that follow, I am dismissing both Applications.

[9] The rival Applications are family law cases, and both Applications should have been commenced in the Family Law Court in Toronto. Both Applications should have been governed by the Family Law Rules and not the Rules of Civil Procedure. Therefore, I am administratively transferring both applications to the Family Law Court in Toronto, where as a judge of the Superior Court, I have the jurisdiction to deal with them.

[10] On their merits, both Applications should be dismissed, but on terms that Ms. Khan shall be allowed 10 days to deliver an amended Application in accordance with the Family Law Rules, failing which Mr. Chowdhury may deliver an Amended Application in accordance with the Family Law Rules. If Ms. Khan delivers an Application, then Mr. Chowdhury should deliver an Answer in accordance with the Family Law Rules. There should be no order as to costs in either Application.

[11] If these family law cases proceed, they should and must proceed by serving and filing an Application and Answer along with the financial statements and disclosure documents required by the Family Law Rules.

[12] For reasons that I will set out below, I direct both parties to deliver a copy of these Reasons for Decision to Simon Fisch, who is the lawyer acting for the Children’s Aid Society of Toronto.

[13] The dismissal of the Applications is without prejudice to Ms. Khan’s claim that 92-A Cedar Brae Blvd. was a matrimonial home at the appropriate time and is without prejudice to Mr. Chowdhury’s request for an order for vacant possession or for an order cancelling the February 7, 2012 matrimonial designation registered by Ms. Khan on the 92-A Cedar Brae Blvd. property.

[14] The dismissal of these Applications is without prejudice to the legal, equitable, or statutory rights of the parties under the Family Law Act on any subsequent application.

[15] The purport of my treatment of both Applications is that there is no basis for staying or interfering with the Royal Bank’s power of sale proceedings, and, in any event, assuming that 92-A Cedar Brae Blvd. property is a matrimonial home, it would not be appropriate to make the orders requested by either party under s. 23 of the Family Law Act without the parties providing the personal and financial information required by a family case under the Family Law Rules and based only on the selective information that they respectively put before the court.

B. FACTUAL AND PROCEDURAL BACKGROUND

1. Introduction

[16] I shall briefly describe or summarize the factual and procedural background below. In doing so, I make no binding findings of fact.

[17] There are numerous contested issues, including the legality of Ms. Khan’s divorce and of the legal significance of the parties’ subsequent religious marriage ceremony performed in Bangladesh.

[18] The evidence for both Applications was highly problematic, and apart from the fact that there were multiple levels of hearsay, there are serious problems of the credibility and reliability of the evidence offered for both Mr. Chowdhury and for Ms. Khan.

[19] The frailties of the evidence were exacerbated by the fact that both parties were very selective and not forthcoming about such important matters as the date of their separation and about their occupation and use of the 92-A Cedar Brae Blvd. property. Both parties avoided providing the financial disclosure that would be required under the Family Law Rules.

[20] Further, there were other reasons to doubt the reliability of the evidence. In the exigencies of the pending power of sale proceedings, there were no cross-examinations. Although I doubt whether cross-examinations and transcript evidence would have ultimately been helpful in revealing the truth, there is enough on the record to be sceptical about whether either party was speaking truthfully given their apparent avarice and animosity.

[21] I will give two examples of why the court should be sceptical. The first example concerns Mr. Chowdhury, who is currently in jail for breaching the terms of his bail for domestic assault offences. Mr. Chowdhury blames his confinement on Ms. Khan unlawfully taking possession of the 92-A Cedar Brae Blvd. property while he was on business trip to Bangladesh. He says that he was forced to break-and-enter into his own home and was arrested, when the truth of the matter appears to be that he was arrested for going to Bangladesh in breach of the terms of his bail.

[22] The second example concerns Ms. Khan. On the specious grounds of irrelevance, she has simply refused to provide any explanation for what appears to have been her participation in an ultimately unsuccessful identity fraud to mortgage the 92-A Cedar Brae Blvd. property. I am not making any finding that she was a participant in this attempted fraud, but she was wrong in not providing an explanation for her involvement, if any, to these events.

[23] With these cautionary observations, for the purpose of the two Applications now before the court, the background facts are as follows.

2. The Background Facts

[24] As evidenced by a marriage certificate from the Government of the People’s Republic of Bangladesh, on August 14, 2005, Ms. Khan and Mr. Chowdhury married in Bangladesh. They had been living together since December 2000. They have three children, Mashur, age almost 7 years, and twins Aabian and Aadian, age almost 4 years. Ms. Khan has a child by a previous marriage, Wasif Khan, age 19.

[25] In her initial Application materials, Ms. Khan did not provide any written evidence of the lawful dissolution of her prior marriage, which may have occurred in March 2000. In a supplementary affidavit from a law clerk, she subsequently provided a copy of a certificate of divorce, but Mr. Chowdhury challenges the certificate’s authenticity.

[26] Mr. Chowdhury admits that he and Ms. Khan participated in a religious marriage ceremony in Bangladesh, but assuming that Ms. Khan had the capacity to marry, he now says that it has not been established that the Bangladesh marriage with Ms. Khan would be recognized as a marriage in Ontario pursuant to the principles of conflicts of laws.

[27] Mr. Chowdhury acknowledges that Ms. Khan has produced a “marriage certificate” from the Government of Bangladesh, but, once again, he challenges its authenticity, and, in any event, he submits that Ms. Khan has not met the onus of showing that she is a spouse for the purposes of Part II of the Family Law Act.

[28] Whether or not legally married, there is no doubt that Mr. Chowdhury and Ms. Khan lived together with their children in Toronto from 2000 to sometime in 2011.

[29] Mr. Chowdhury is the registered owner of 92-A Cedar Brae Blvd. in Toronto, which he purchased in 2009. He lived there with Ms. Khan and the children until the parties separated sometime in 2011. It was not disputed that 92-A Cedar Brae Blvd. was used both as a residence and also as a place of business for Mr. Chowdhury, who, through some corporations, in which Ms. Khan may have some ownership or role, sold long distance telephone services.

[30] Ms. Khan deposes that 92-A Cedar Brae. Blvd. was her matrimonial home during their marriage and up until the date of separation. Neither party, however, provided specific evidence about the date of separation and the use of the 92-A Cedar Brae Blvd. property after the separation. Ms. Khan says that the separation date was July 19, 2012, but there is also evidence that she had moved out with the children several months earlier to live with her mother. There is also evidence that Ms. Khan and her children may have resided in the property after the alleged date of separation.

[31] There was no financial disclosure from either party. I understand that the 92-A Cedar Brae Blvd. property may be worth around $1 million. There was evidence that the property had an elaborate high-tech security system and that there is expensive computer and other equipment in the basement. The value of any business interests or other assets is unknown.

[32] It is known that on July 11, 2011, Mr. Chowdhury mortgaged the 92-A Cedar Brae. Blvd. property to secure a line of credit from the Royal Bank. Ms. Khan did not consent to the mortgage, and Mr. Chowdhury states on the mortgage that he was not a spouse. Whether or not this was a true statement is a matter of controversy, the resolution of which will have to wait for another day.

[33] It also appears that during the summer of 2011, Ms. Khan may have been living with the children in an apartment at 117 McClure Crescent.

[34] In the summer of 2011, for reasons unknown and not explained by either party, Ms. Khan signed a statutory declaration waiving her rights under the Family Law Act. Mr. Chowdhury relied on this statutory declaration in support of his argument that the 92-A Cedar Brae Blvd. property was not a matrimonial home.

[35] For present purposes, I give no weight to this document and its significance, if any, is just another matter that will have to be litigated at some other time.

[36] It is alleged by Mr. Chowdhury that around the summer or fall of 2011, there was a conspiracy by Ms. Khan’s father, and Ms. Khan to harm Mr. Chowdhury both physically and financially. Mr. Chowdhury says that there are pending criminal charges against the father for death threats. For present purposes, the relevance of the relationship between Mr. Chowdhury and Ms. Khan’s family escapes me as do several other colourful episodes, which for present purposes I need not discuss.

[37] What I do, however, regard as significant is that during the summer of 2011, and perhaps earlier, the parenting activities of Ms. Khan and Mr. Chowdhury came to the attention of the Children’s Aid Society, and the Society was concerned about whether the basic needs of the children were being provided.

[38] There apparently are pending proceedings initiated by the Children’s Aid Society, and it is for this reason that I direct the parties to bring these Reasons for Decision to the attention of the Society.

[39] It is not very clear from the evidentiary record for the Applications what was happening at the 92-A Cedar Brae Blvd. property between the summer of 2011 and the summer of 2013. It does seem that Mr. Chowdhury was using the property for his residence and for his business. It does seem that during this period that Ms. Khan may have been living with her children at 117 McClure Crescent. It also seems that it is possible that there was a period of reconciliation during which the family was using the 92-A Cedar Brae Blvd. as a home or perhaps a matrimonial home.

[40] On February 7, 2012, for reasons not yet known, Ms. Khan registered a matrimonial home designation against the title of the 92-A Cedar Brae Blvd. property.

[41] At some point between the summer of 2011 and the summer of 2013, it seems that Ms. Khan no longer had the means of entering the 92-A Cedar Brae Blvd. property and only Mr. Chowdhury had access to the property.

[42] In August 2013, however, the tables were turned. While Mr. Chowdhury was out of the country in Bangladesh, Ms. Khan broke into the property and changed the locks and locked out Mr. Chowdhury. Ms. Khan’s entry into the property was recorded by the elaborate security monitoring system.

[43] When Mr. Chowdhury returned from Bangladesh and attempted to regain possession, he was arrested, and he has been in jail since the summer of 2013.

[44] Meanwhile, Mr. Chowdhury defaulted in making payments on the Royal Bank’s mortgage, and it commenced power of sale proceedings in September 2013.

[45] On December 6, 2013, the Bank obtained a default judgment and leave to have a writ of possession issued.

[46] Ms. Khan deposed that she had been searching for a way to bring the Royal Bank’s mortgage into good standing and that she has no other place to live other than the 92-A Cedar Brae Blvd. property. Mr. Chowdhury disputes that Ms. Khan is unable to arrange alternative housing for herself and the children.

[47] I make no finding, but it may be that what Ms. Khan describes as searching for a way to bring the Royal Bank’s mortgage into good standing may be a euphemism for her participating in a mortgage fraud during the fall of 2013. Mr. Chowdhury alleges that the tenant at the 92-A Cedar Brae Blvd. property impersonated him in an attempt to mortgage the property and that Ms. Khan participated in this charade. Whether this allegation is true is another matter that may have to be determined some other day.

[48] In any event, in the fall of 2013, Ms. Khan and her dependent children were confronted with a problem. Mr. Khan was in jail, and he was not keeping the Royal Bank’s mortgage in good standing and the family was facing eviction.

[49] In these circumstances, on January 18, 2014, Razer Capital Corporation agreed to loan Ms. Khan an amount that would bring the Royal Bank mortgage into good standing. However, this mortgage commitment was conditional on Ms. Khan obtaining a court order permitting Razer Capital to encumber the property without the consent of Mr. Chowdhury.

[50] On February 6, 2014, the Royal Bank mailed the parties a Notice to Vacate the 92-A Cedar Brae Blvd. property.

[51] On February 13, 2014, Ms. Khan brought an Application for an order pursuant to s. 23 of the Family Law Act in order to have the 92-A Cedar Brae Blvd. property encumbered. Under s. 23, a spouse with an interest in a matrimonial home, may apply for an order to dispose of or encumber the matrimonial home, if the spouse on title is unreasonably withholding consent.

[52] Ms. Khan’s application was brought as an Application under the Rules of Civil Procedure. However, as I will repeat below, it undoubtedly was a family law case and it ought to have been brought in accordance with the Family Law Rules.

[53] It was, however, set down as a motion on the list for civil cases and the case came on before me on February 18, 2014. At that time, a representative for Mr. Chowdhury requested an adjournment.

[54] On February 18, 2014, I made an interim order and endorsed the record as follows:

The Respondent Chowdhury requests an adjournment of this urgent matter in order to retain counsel to argue the application. He has filed responding material in the interim. The matter is urgent because the Royal Bank is enforcing the mortgage security on what may be the Applicant’s only matrimonial home (the ownership is contested). The Bank, however, has agreed at the court’s request to stay its writ of possession until this matter can be properly heard. Counsel for Mr. Chowdhury, Susan Jane van Achten, has undertaken to appear if he cannot retain other counsel. In these circumstances, I am adjourning the application to March 6, 2014, 11:00 a.m.. I shall remain seized of this matter. Costs reserved to the return of the application. The Applicant shall serve a copy of this endorsement on the Bank. The Applicant may serve any reply material on Ms. van Achten.

[55] On March 3, 2014, Mr. Chowdhury brought his own Application with respect to the 92-A Cedar Brae. Blvd.; it is essentially a cross-application.

[56] On March 6, 2014, Ms. Khan’s Application came on for a hearing. Mr. Chowdhury, once again, sought an adjournment for the purposes of cross-examinations. I denied the adjournment request after his counsel indicated a readiness to proceed notwithstanding the absence of cross-examinations.

[57] During the hearing of Ms. Khan’s Application, I was advised about and accepted a copy of Mr. Chowdhury’s Application, which had been served on Ms. Khan.

[58] During the hearing, I was advised that there is a reasonable chance that Mr. Chowdhury may be released from jail by the end of March, 2014.

C. DISCUSSION AND ANALYSIS

[59] Section 23 of the Family Law Act states:

Powers of court respecting alienation

23. The court may, on the application of a spouse or person having an interest in property, by order,

(a) determine whether or not the property is a matrimonial home and, if so, its extent;

(b) authorize the disposition or encumbrance of the matrimonial home if the court finds that the spouse whose consent is required,

(i) cannot be found or is not available,

(ii) is not capable of giving or withholding consent, or

(iii) is unreasonably withholding consent,

subject to any conditions, including provision of other comparable accommodation or payment in place of it, that the court considers appropriate;

(c) dispense with a notice required to be given under section 22;

(d) direct the setting aside of a transaction disposing of or encumbering an interest in the matrimonial home contrary to subsection 21 (1) and the revesting of the interest or any part of it on the conditions that the court considers appropriate; and

(e) cancel a designation made under section 20 if the property is not a matrimonial home.

[60] Rule 1 (2) of the Family Law Rules, O. Reg. 439/07 provides that these rules apply to all family law cases in the Superior Court of Justice under the Family Law Act, except Part V. Rule 8 (1) provides that to start a case, a person shall file an application in one of the prescribed forms. Rule 10 (1) provides that a person against whom an application is made shall serve an answer in one of the prescribed forms on every other party and file it within 30 days after being served with the application.

[61] Rule 13 requires the delivery of financial statements if an application, answer or motion contains a claim for support, a property claim, or a claim for exclusive possession of the matrimonial home and its contents. Rule 13 states:

13. (1) If an application, answer or motion contains a claim for support, a property claim, or a claim for exclusive possession of the matrimonial home and its contents,

(a) the party making the claim shall serve and file a financial statement (Form 13 or 13.1) with the document that contains the claim; and

(b) the party against whom the claim is made shall serve and file a financial statement within the time for serving and filing an answer, reply or affidavit or other document responding to the motion, whether the party is serving an answer, reply or affidavit or other document responding to the motion or not.

[62] For the purposes of deciding the two Applications now before the court, I will assume that the 92-A Cedar Brae Blvd. property is a matrimonial home. On that assumption I would not, based on the evidentiary record now before the court, make an order authorizing the encumbrance of the matrimonial home, and I would not cancel the designation made under s. 20 of the Act. In other words, after notionally transferring the Applications to the Family Law Court in Toronto, the motions for interlocutory relief have not been properly constituted and both Applications should be dismissed without prejudice to proper motions being brought.

[63] Similarly, based on this evidentiary record, I would not make an order authorizing the disposition of the property, which appears to be happening in any event pursuant to the Royal Bank’s power of sale proceeding.

[64] It is hard to say, but a sale of the property may be the appropriate outcome. If it is true that Ms. Khan and the children have no other place to live other than the 92-A Cedar Brae Blvd. property based on the evidentiary record now before the court, then it seems that that Mr. Chowdhury also has no other place to live. It also seems true that the parties are not capable of living together even temporarily. Thus, it may be that a sale of the property and a distribution of the proceeds of sale may be the best outcome. However, I am not prejudging proper motions and simply say that the current Applications should be dismissed.

[65] The factual circumstances are such that both Applications should never have been brought as Applications under the Rules of Civil Procedure. The proper disposition and treatment of the matrimonial home should and must be done with proper financial disclosure by both Ms. Khan and Mr. Chowdhury.

D. CONCLUSION

[66] For the above reasons and subject to the terms described above, I dismiss both Applications without costs.

[67] Orders accordingly.

Perell, J.

Released: March 11, 2014

COURT FILE NO.: 14-CV-498466

DATE: 20140311

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

FARHANA SULTANA KHAN

Applicant

‑ and ‑

MASHUQUAL HUQ CHOWDHURY

Respondent

REASONS FOR DECISION

Perell, J.

Released: March 11, 2014