SUPERIOR COURT OF JUSTICE - ONTARIO

RE: LEVON KHANKALDIYAN also known as
LEVON KHANKALDIYAN HAFTVAN, Applicant

AND:

VALENTINA AVDEEVA, Respondent

BEFORE: F.L. MYERS J.

COUNSEL: Gregory M. Sidlofsky, for the Applicant
Kirkor A. Apel, for the Respondent

HEARD: March 25, 2014

endorsement

[1] This endorsement applies to this application and to the motion brought by the applicant in an action commenced by the respondent against the applicant under court file number CV-05-299825 (the “2005 Action”).

[2] In both the motion and this application, the applicant seeks an order setting aside the order made in the 2005 Action by Belobaba J. on March 6, 2009. In that order, Belobaba J. declared that the respondent had title to 100% of the property known municipally as 43 Bowan Court, Toronto (the “Property”). Belobaba J. also ordered the rectification of the land titles register for the Property to delete the name of the applicant from title.

[3] The motion before Belobaba J. was heard without notice to the applicant although he is the defendant in the 2005 Action. A handwritten addition to the order granted by Belobaba J. recites “no one appearing for the defendant despite efforts to find and serve him (as per supplementary affidavit filed by the plaintiff)”. It is the applicant’s contention today that his whereabouts were well known to the respondent and her daughter who is assisting her in these proceedings. The respondent’s daughter, Elena Klevtsov, lived with the applicant in the Property upon its purchase. Upon the breakdown of their relationship, the 2005 Action ensued. In 2009, both parties were unrepresented.

[4] In addition to moving to set aside the order of Belobaba J., in this application the applicant seeks an order rectifying the land titles register, a declaration that he has a 50% interest in the Property, punitive damages in the amount of $100,000, and costs on a substantial indemnity basis.

[5] The applicant filed a significant amount of evidence establishing that the respondent, her daughter, and granddaughter (the applicant’s former stepdaughter) had and have his email address, his cell phone number, his Facebook particulars, and frequent interaction with common acquaintances and friends (including their mutual real estate lawyer). It would not have been difficult for the respondent to locate the applicant had she wished to do so, he says.

[6] The respondent’s evidence, given solely by Ms Klevtsov, is that she believed the applicant had left the country and Google searches in his full name Levon KHANKALDIYAN did not yield his whereabouts. However, the respondent does not deny that the applicant is widely known professionally in the arts community as Levon HAFTVAN. The applicant has submitted evidence establishing that he had a substantial internet presence, including several pages of listings on Google, in his professional name in 2009.

[7] Unfortunately, the supplementary affidavit of the respondent recited in the order of Belobaba J. cannot be found in searches of the court file conducted by the counsel for both parties. In her endorsement dated January 8, 2014, granting an adjournment to the respondent upon her lawyer failing to attend court due to illness, Chiappetta J. ordered the respondent to produce a copy of her supplementary affidavit that was before Belobaba J. The respondent’s counsel today advises that the respondent says that she does not have a copy of her own supplementary affidavit that she filed. The respondent’s response to the proof submitted by the applicant that the respondent could have readily contacted him in 2009 was at paragraph 27 of Ms Klevstov’s affidavit sworn October 31, 2012 as follows:

In attempting to serve Levon Khankaldiyan with the motion record, in addition to personal efforts, two independent professional servers were used, Bona Fide Process Servers and Profile Resources Limited. They were also unable to locate Levon Khankaldiyan, despite Levon Khankaldiyan being “easy” to find, even with their driver license search capabilities and other skills.

[8] The respondent, through Ms Klevstov, states that there were two affidavits of the process servers filed before Belobaba J. but she denies having copies of those alleged affidavits as well. The order of Belobaba J. makes no reference to any affidavits of process servers concerning alleged attempted service. The court file also does not contain any such affidavits either. Under cross-examination, Ms Klevtsov initially agreed to ask the process servers to advise of the steps that they took to locate the applicant. The respondent’s counsel then interjected, “No. It is not our job to do your work for you. If you want to do that, you are free to do that.”

[9] Paragraph 27 of Ms Klevtsov’s affidavit is of little probative value and is negatively affected, in my view, by the respondent’s inability to produce a copy of her own supplemental affidavit and the alleged affidavits of her process servers. I also do not see how she can be entitled to rely on hearsay information from the process servers while she refuses to undertake to contact them and provide their information to the applicant. I am also cognizant of Ms Klevtsov’s use of the applicant’s formal name, Levon Khankaldiyan, rather than his professional name, Levon Haftvan, in paragraph 27 quoted above.

[10] The respondent has delivered no evidence undermining the substantial evidence of the applicant indicating that she had the ability to contact him in 2009. In all of the circumstances, I have little difficulty concluding on the balance of probabilities that the respondent had the ability to communicate with the applicant had she wished to do so when she appeared before Belobaba J. on March 6, 2009. Therefore, she failed to make “full and fair disclosure of all material facts” to Belobaba J. An order made without notice can be set aside on that basis alone under Rule 39.01(6) although a residual discretion remains to refrain from doing so in exceptional circumstances.

[11] The respondent submits that I should deny the relief sought because the applicant took three years to bring its motion to set aside the order of Belobaba J. The applicant’s uncontested evidence, in paragraph 2 of his affidavit sworn January 30, 2012, is that he only learned of the order on January 26, 2012. The notice of application is dated February 1, 2012. The notice of motion before me is dated February 24, 2012. Rule 37.14(1) provides that a party affected by an order obtained without notice “may move to set aside or vary the order, by a notice of motion that is served forthwith after the order comes to the person’s attention”. The respondent did not cross examine or otherwise seek to undermine the applicant’s evidence as to when he learned of the order of Belobaba J. In my view, the applicant complied with the provisions of Rule 37.14(1).

[12] I do not see how I can resolve on this motion and application the issue as to which of the parties has title to the Property and in what shares. There is a dispute in the evidence as to whether the applicant put any money into the Property and whether, in any event, he signed an agreement confirming that he held only a 1% interest in the Property and he held even that minimal interest only as bare trustee for the respondent. I raised with counsel whether there could be a quick, case managed trial of an issue with limited disclosure and discovery to address solely those questions. This would protect the respondent from the alleged improper negotiating leverage that she claims lies behind the applicant’s application and motion. However, rather than wanting a quick and narrow trial, the respondent’s counsel stated that although the respondent has not proceeded on any of the other allegations or causes of action pleaded in the 2005 Action in the nine years since the claim was commenced, the issue of the quantum of investment made by the applicant in the Property requires an accounting for all of the allegations of wrongdoing made against the applicant in the statement of claim. Thus, the respondent does not wish the protection of a speedy, narrow trial limited only to the Property in the event that I set aside the order of Belobaba J. that she obtained.

[13] In all, I cannot say that the Belobaba J. would have made the order dated March 6, 2009 without notice had the respondent told him the material facts fully and fairly. I, therefore, set aside the order made by Belobaba J. dated March 6, 2009. It is a condition of my order setting aside the order of Belobaba J. that the applicant take no steps to encumber or alienate in any manner both the Property and his share of title to the Property (whatever share that might be, if any) pending the final outcome of this application including any appeals from any final order that may be granted.

[14] I direct the relevant Registrar of Titles to rectify the parcel register to show the same ownership of the Property as was shown on the parcel register immediately prior to the registration of the order of Belobaba J. The certificate of pending litigation and injunction previously granted are to remain in place pending further order of the court.

[15] Under the provisions of rule 38.10 (b), I order that the remaining issues in the application proceed to a trial of the issues for the relief sought in paragraphs 1 (c), (e), (g) and (h) of the notice of application. The trial of the issues will occur in due course at the same time as the trial of the 2005 Action. There will be no further evidence filed in the application. Rather, the examinations for discovery and evidence presented at trial will serve as the evidence in the application.

[16] The applicant seeks costs of the motion and application on the basis that it is the respondent’s actions that caused the application and motion to be necessary. I agree. Moreover, the application and motion are today on their 7th return date largely due to the respondent’s failure to move with dispatch as outlined in the endorsement of Chiappetta J. dated January 8, 2014 and my endorsement denying the respondent’s request to adjourn the motion and application yet again. The respondent’s positions (including her repeated requests for adjournments to bring motions that she never scheduled for hearing and her counsel’s failure to show up in court on little notice more than once) have lengthened the proceedings and unnecessarily caused the parties to incur costs. The applicant’s proposed costs outline included a number of steps that have already been subject to costs awards made by other judges. There is no double dipping allowed. In my view, the applicant is entitled to be paid by the respondent one set of costs in the application and motion in the aggregate amount of $10,000 on a partial indemnity basis inclusive of disbursements, HST and the costs of cross-examination. These costs and the costs ordered by Chiappetta J. are to be paid within 30 days failing which the applicant may seek appropriate relief under the Rules.

F.L. Myers J.

Date: March 26, 2014