CITATION: Guettler v. Royal Bank of Canada, 2015 ONSC 2905

BARRIE COURT FILE NO.: CV-14-1021

DATE: 20150504

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: ARNOLD GUETTLER, Plaintiff

AND:

ROYAL BANK OF CANADA, SHELDON BARRIS, EVE BARRIS, MICHAEL GARDNER, JONATHAN SMITH, JUST JUNK, RICHARD STEWART, NANCY STEWART, ROGER SELMAN, ANNE SMILIE-FENN, EPHRAIM FIKSEL, ROBERT ZIGLER, JORLEE HOLDINGS LIMITED, RE/MAX DOCKSIDE REALTY LTD. AND CENTURY 21 LAKESIDE COVE REALTY LTD., Defendants

BEFORE: DiTOMASO J.

COUNSEL: Arnold Guettler on his own behalf

Gregory W. Bowden, Counsel for the Royal Bank of Canada

James Klein, Counsel for the Defendants Sheldon Barris, Eve Barris, Michael Gardner, Jonathan Smith, Just Junk and Jorlee Holdings Limited.

Fredrick Schumann, Counsel for the Defendants Ephraim Fiksel and Robert Zigler

Sabrina A. Lucenti, Counsel for Richard Stewart and Nancy Stewart

Christopher M. Tucker, Counsel for Anne Smilie-Fenn and Re/Max Dockside Realty Ltd.

Harry Perlis, Counsel for Roger Selman and Century 21 Lakeside Cove Realty Ltd.

HEARD: by written submissions

ENDORSEMENT

[1] This motion was referred to me by the Registrar’s Office pursuant to rule 2.1.01(7) and pursuant to the endorsement of Healey J. dated November 10, 2014.

[2] Several Defendants made requests pursuant to rule 2.1.01(6) for an order pursuant to rule 2.1.01(1) staying or dismissing this action.

[3] Pursuant to the endorsement of Healey J. the Plaintiff and the Defendants delivered submissions in writing.

[4] I have reviewed those submissions together with a copy of the Statement of Claim.

Rule 2.1

[5] Rule 2.1.01(1) of the Rules of Civil Procedure enables the court, on its own initiative or at the request of a party, to stay or dismiss a proceeding or a motion that on its face appears to be frivolous, vexatious or an abuse of process by a summary process that requires written submissions from the Plaintiff, Applicant or Moving Party. Other parties are notified and given an opportunity to respond if the court directs.

[6] A useful discussion of the principles and policy underlying rule 2.1 was discussed by Myers J. in Raji v. Borden Ladner Gervais LLP 2015 1931 (ONSC).

Statement of Claim

[7] I have reviewed the Statement of Claim issued September 5, 2014 by Mr. Guettler. Mr. Guettler claims general damages in the amount of $800,000 and punitive damages in the amount of $400,000 against the Defendants who are a number of individuals, a corporation, a chartered Canadian bank, mortgage brokers, a junk removal company, realtors, lawyers and an Assistant Crown Attorney.

[8] The essence of Mr. Guettler’s claim is that the Defendants wilfully and intentionally colluded and damaged his right to a peaceful life. It is alleged that the Defendants wilfully and intentionally colluded and harassed Mr. Guettler. Further, it is alleged that these alleged unprovoked actions on the part of the Defendants have damaged Mr. Guettler’s health and have interfered with the enjoyment of life of Mr. Guettler and his wife in their golden years. Lastly, Mr. Guettler claims that the Defendants took possession of a house and removed all of its contents without any legal authority.

[9] The essence of the claim relates to a property located at 25 Willow Crescent, Lagoon City, Ontario. This property was the subject of a Power of Sale and then later sold to purchasers. Mr. Guettler claims that the property was in the name of Chelmarc Holding Corporation and that Mr. Guettler did not receive notice of Chelmarc’s dissolution. Mr. Guettler in his Statement of Claim challenges the Power of Sale proceedings which eventually lead to the Willow Crescent property being listed for sale and then sold to new buyers. He alleges that the Power of Sale proceedings were unlawful and fraudulent, that Jorlee Holdings Limited gained illegal possession of the property and that in the process, personal belongings were illegally removed. The new buyers mortgaged the property with the Royal Bank of Canada and allegedly mortgaged the property for 100 percent of the selling price. It is alleged that the purchasers knew or should have known of the illegal dealings in respect of the Willow Crescent house and property.

The claims alleged against Fiksel and Zigler.

[10] I find that the Statement of Claim as plead discloses no cause of action known to law against Mr. Fiksel and Mr. Zigler for two reasons.

[11] Firstly, Mr. Guettler lacks standing to sue. He pleads that the property in question was bought and registered in the name of Chelmarc Holding Corporation (“Chelmarc”). He pleads that Chelmarc was dissolved in April 2006, and alleges that this was without his knowledge. Chelmarc, not the Plaintiff, would have standing to sue in relation to the property. Mr. Guettler admits in his rule 2.1 submission that “Chelmarc is an entity without any standing whatsoever”.

[12] Secondly, there is no cause of action pleaded against Mr. Fiksel or Mr. Zigler. The only allegation against them in that they participated in implementing Power of Sale proceedings in relation to the Willow Crescent property on behalf of their clients, the Defendants Sheldon Barris and Jorlee Holdings Limited (“Jorlee”):

(a) On July 12, 2010 Robert Zigler “lawyer for Sheldon Barris” sent a Notice of Sale Under Mortgage to Chelmarc. On the same day, Mr. Zigler sent a Notice of Intention to Enforce Security to Chelmarc, describing Chelmarc as “an insolvent person”. The Statement of Claim alleges that “both notices were improperly composed and issued” but does not give any further details.

(b) On December 8, 2010, Mr. Fiksel transferred the property by Power of Sale to Chelmarc to Mr. Barris. Mr. Fiksel also registered the subsequent transfer by Mr. Barris to Jorlee.

(c) There are bald allegations in the Statement of Claim and rule 2.1 submissions, for example, the allegation that the “Power of Sale proceedings were unlawful and fraudulent”.

(d) There are no allegations of what counsel for Mr. Fiksel and/or Mr. Zigler describe as what could be technical deficiencies. It is alleged that “there is no documented money trail or accounting on the Power of Sale proceedings”. It is submitted and I agree that there is no evidence of these allegations. Further, Mr. Guettler never pleads that Mr. Fiksel or Mr. Zigler owed him any duty known to law. On the face of his pleading, they were acting as lawyers for Mr. Barris and/or Jorlee.

[13] It is also submitted on behalf of Mr. Fiksel and Mr. Zigler that this action is res judicata.

[14] Contained in the Brief submitted on behalf of Mr. Fiksel and Mr. Zigler there is a copy of a Statement of Claim in the action commenced by Chelmarc Holding Corp., Arnold Guettler and Igneborg Guettler against Sheldon Barris and Jorlee Holdings Limited in the Superior Court of Justice, Court file No. CV-13-1515-00.

[15] Counsel for Mr. Fiksel and Mr. Zigler submit on April 8, 2013, before commencing this action, Mr. Guettler commenced an action in the Superior Court of Justice (file number CV-13-1515-00). The Brampton action is still pending. That action arose in part out of the same facts as pleaded in this claim, as shown by the following passages from the Statement of Claim in the Brampton action:

7. On or about October 24, 2003, the Guettlers purchased the property known as 25 Willow Crescent, Brenchin (sic), Ontario, L0K 1B0 (the “Willow property) for the sum of $182,000.00. The title to the Willow property was registered to Chelrnarc (sic). The purchase was financed through a second mortgage advanced by the co-defendant, Mr. Sheldon Barris (“Mr. Barris”).

8. In 2010, the mortgages fell into arrears. Unknown to the Guettlers, Ms. Barris initiated Power of Sale proceedings with respect to both the Willow and the Lakeshore properties. At the time of the Power of Sale proceeding, the Willow property was encumbered with two mortgages in favour of Mr. Barris, the first one with the principal balance of $90,000.00 and the second one with the principal balance of $235,000.00. …

9. Unknown to the Guettlers, on or about December 8, 2010, Mr. Barris sold the Willow Property from himself to his own corporation, Jorlee Holdings Limited (“Jorlee”), for the sum of $535,000.00. Also unknown to them, he sold the Lakeshore property from himself to Jorlee for the sum of $100,000.00.

10. Mr. Barris has made no efforts to sell the properties on an open market and realize the highest possible price for the properties. Instead, he sold both properties to his own corporation. The plaintiffs have been the victims of a scheme directed by Mr. Barris to deprive them of the ownership of the two properties.

11. The defendant, far from acting as a prudent mortgagor, has breached his fiduciary duty obligations by selling the two properties to his own company, refusing to tell the plaintiffs where the money from the sale has gone, and most insulting of all, by attempting to remove the plaintiffs from the Lakeshore property.

12. The defendants have failed to account for the Power of Sale transactions.

13. In or about December of 2011, after the defendants had taken possession of the Willow property, the Guettlers moved into the Lakeshore property. The Guettlers have been residing at the Lakeshore property ever since that time.[^1]

[16] It is submitted that although the Defendants Mr. Fiksel and Mr. Zigler were not defendants in the Brampton action, they could have been, since the action concerned the Willow property. It is significant that the Plaintiff was represented by counsel when the Brampton statement of claim was issued. This action is an abuse of process since there is another action pending in the Brampton court with respect to the same allegations.

[17] Further, the Brampton action sought, inter alia, injunctive relief and an accounting respecting the Power of Sale proceeding over the Willow property.[^2] Ex parte, the plaintiff obtained an injunction and a certificate of pending litigation over the Lakeshore property (another property over which he had granted a mortgage to the defendant Mr. Barris). On July 16, 2013, Justice Skarica set aside the ex parte order, finding as follows:

The corporation Chelmac (sic) Holdings, has no proven assets and has been dissolved since 2006.

There are no undertakings regarding damages, and given the history of non-payment, such undertakings would have little merit.

The Office of the Public Guardian in a letter, dated 2013-06-06 acknowledged that the plaintiff Chelmarc Holdings which commended this action has been dissolved since March 13, 2006. This was not disclosed to Justice Bielby.[^3]

[18] Justice Skarica ordered Mr. Guettler to pay $10,000 in costs.

[19] It is submitted that Mr. Guettler’s claim is statute barred on its face. Mr. Guettler discovered or ought to have discovered the facts pleaded in relation to Mr. Fiksel and Mr. Zigler by December 2010, when the impugned transfer occurred, or, alternatively, by December 2011 when Mr. Guettler was forcibly dispossessed; or, in the further alternative by April 2012, when his belongings were removed from the house. All of those dates are more than two years before the date on which this action was commenced, namely, September 5, 2014.

[20] I find that Mr. Guettler’s claims against Mr. Fiksel and Mr. Zigler are frivolous, vexatious and an abuse of process of the court. They are devoid of merit and accordingly Mr. Guettler’s action is dismissed as against these Defendants under rule 2.1.01(1).

Claims against the Defendants Sheldon Barris, Eve Barris, Michael Gardner, Jonathan Smith, Just Junk and Jorlee Holdings Limited

[21] There is no factual underpinning pleaded by Mr. Guettler that gives rise to any cause of action against these Defendants.

[22] Just Junk was retained by Jorlee to clean the property for the new owners. It is submitted that Mr. Guettler was given the opportunity to remove any of the contents and anything that was left was taken away as junk. There is no cause of action against Just Junk. There is no cause of action against Michael Gardner and Jonathan Smith regarding items removed by these individuals. Michael Gardner is the son of Eve Barris and Jonathan Smith is the son-in-law of Eve Barris. They were present when Just Junk was removing junk from the premises. They did not remove anything or keep anything removed from the premises. There is no cause of action against them.

[23] Eve Barris is the wife of Sheldon Barris. The property was never owned by the Plaintiff by Chelmarc. Mr. Guettler has no standing in this action. Eve Barris removed no contents from the premises and retained no contents from the premises. She was there to supervise the clean out of the premises by Just Junk on behalf of Jorlee (her husband’s company). No cause of action is pleaded against Eve Barris.

[24] Regarding Sheldon Barris, he is the sole shareholder and director of Jorlee which owned the premises. He is the husband of Eve Barris. There is no cause of action pleaded against Sheldon Barris.

[25] As for Jorlee, Jorlee properly became the owner of the premises. Again, Mr. Guettler has no standing and the correct party to advance any claim would be Chelmarc. However, Chelmarc is a dissolved corporation. These Defendants further rely upon the submissions made on behalf of Mr. Fiksel and Mr. Zigler outlining the Brampton proceedings and endorsement of the court as it relates to the claims of Chelmarc. Costs have never been paid by the Plaintiff to Jorlee or Sheldon Barris as ordered by the court in Brampton in the Brampton action. It is submitted that the Brampton action is not prosecuted. Instead, Mr. Guettler commenced the within Barrie action.

[26] The claims of Mr. Guettler are also res judicata and statute barred as against all of these named Defendants on the same grounds as advanced on behalf of the Defendants Mr. Fiksel and Mr. Zigler.

[27] I find that Mr. Guettler’s claims against these said Defendants are also frivolous, vexatious and an abuse of process of the court and also devoid of merit.

[28] For these reasons, it is ordered that pursuant to rule 2.1.01(1) Mr. Guettler’s action and his Statement of Claim against these Defendants is dismissed.

Claims against Defendants Roger Selman and Century 21 Lakeside Cove Realty Ltd.

[29] I have reviewed the allegations against these Defendants as set out in the Statement of Claim. It is alleged that the property was listed and advertised with Mr. Selman, broker of Century 21 Lakeside Cove Realty Ltd. including contents belonging to Mr. Guettler. It is further alleged that Mr. Selman was informed and had full knowledge of the illegal activities, including the Power of Sale by Sheldon Barris and Jorlee. This is the extent of the allegations against these Defendants. For the following reasons I find that Mr. Guettler lacks standing in this proceeding, that the allegations in the Statement of Claim as against Mr. Selman and Century 21 are bald allegations which lack the requisite factual substance to substantiate a valid cause of action and the claims as against Mr. Selman and Century 21 are statute barred.

[30] Mr. Guettler has no standing in respect of this matter as the property was owned by Chelmarc. Chelmarc’s purchase was financed through Mr. Barris. Mr. Barris, acting as mortgagee, sold the property under Power of Sale to Jorlee. Then, Jorlee sold the property to the Stewarts. Mr. Guettler was never the registered owner of the property. There are no allegations plead in the Statement of Claim that Century 21 or Mr. Selman took possession of Mr. Guettler’s chattels from the property. Mr. Guettler has no cause of action against these Defendants as he lacks the requisite standing.

[31] Further, the claims made by Mr. Guettler against Mr. Selman and Century 21 are bald and lack any requisite factual substance to substantiate a valid cause of action. Again, Mr. Guettler did not own the property for sale during the time of listing nor did he ever own the property. Supporting documents set out the chain of title which demonstrate that Mr. Guettler was never the registered owner. On this basis as well, Mr. Guettler’s action is dismissed pursuant to rule 2.01.01(1).

[32] Lastly, I find the claim is statute barred for the same reasons I accepted and found based on the submissions made on behalf of Mr. Fiksel and Mr. Zigler.

[33] Accordingly, I find Mr. Guettler’s action to be frivolous, vexatious and an abuse of process. His claims against these Defendants are totally devoid of merit. I hereby dismiss the action and Statement of Claim as against these Defendants pursuant to rule 2.01.01(1).

Claims against the Defendants Anne Smilie-Fenn and Re/max Dockside Realty Ltd.

[34] The Statement of Claim alleges that the property in question was sold to the Stewarts by Anne Smilie-Fenn of Re/max Dockside Realty Ltd.

[35] For the following reasons, I would dismiss Mr. Guettler’s action and Statement of Claim:

(a) Other than identifying Ms. Smilie-Fenn and Re/max as parties, the Statement of Claim does not provide any factual basis to support the bald allegations found in the claim and specifically at page 7 paras. 1 – 3 inclusive.

(b) Mr. Guettler does not have standing to bring this claim as the property at all material times was owned by Chelmarc.

(c) The Statement of Claim is statute barred for the same reasons identified in his submissions made on behalf of Mr. Fiksel and Mr. Zigler. The Statement of Claim was issued on September 5, 2014. The claims were all discoverable long before the issuance of the Statement of Claim in the Barrie action.

[36] I find the action commenced by Mr. Guettler against Anne Smilie-Fenn and Re/max Dockside Realty Ltd. is frivolous, vexatious and otherwise an abuse of process of the court. The claims are completely devoid of merit. Accordingly, I hereby dismiss the Statement of Claim as against these Defendants pursuant to rule 2.1.01(1).

Claims against the Defendants Richard Stewart and Nancy Stewart

[37] I have reviewed the Statement of Claim in respect of these Defendants and it is alleged in the Statement of Claim that the Stewarts as purchasers, had or should have had knowledge of the illegal dealings in regards to the house and property.

[38] I find that Mr. Guettler has no cause of action against Mr. and Mrs. Stewart. No factual basis has been plead to support the allegations of fraud, liable or deception. The Stewarts purchased the property by way of Power of Sale proceedings from the vendor on April 13, 2012 – nearly four months after Mr. Guettler had been evicted from the property where he was a tenant until December 19, 2011. The Stewarts repeat and rely upon submissions made by their co-defendants.

[39] I find that those submissions equally apply to the Stewarts where Mr. Guettler has no standing to bring any claim against the Stewarts and the claim brought by Mr. Guettler is statute barred in any event.

[40] I find that this action commenced by Mr. Guettler against the Stewarts is on its face, frivolous, vexatious and otherwise an abuse of process. It is devoid of merit. Mr. Guettler’s action and Statement of Claim is hereby dismissed as against these Defendants pursuant to rule 2.1.01(1).

Claim against the Defendant Royal Bank of Canada

[41] At para. 18 of the Statement of Claim, Mr. Guettler alleges that the Stewarts signed a mortgage with the Royal Bank of Canada for a certain amount which he takes to mean that the mortgage registered on the property in favour of the Bank is for the full amount of the purchase price.

[42] I find that this bald assertion does not amount to a cause of action as against the Defendant Royal Bank of Canada. No factual foundation to support any claim against the Bank.

[43] Accordingly, I find that the claim against this Defendant is frivolous, vexatious or otherwise an abuse of process of the court. Mr. Guettler’s Statement of Claim and action as against this Defendant is hereby dismissed pursuant to rule 2.1.01(1).

CONCLUSION

[44] For the foregoing reasons, I find that Mr. Guettler’s Statement of Claim on its face is frivolous, vexatious or otherwise an abuse of process of the court. Accordingly, Mr. Guettler’s Statement of Claim and action is hereby dismissed as against all Defendants pursuant to rule 2.1.01(1) of the Rules of Civil Procedure.

[45] Only counsel for Mr. Fiksel and Mr. Zigler has asked for costs of the action. Costs shall be disposed of by way of written submissions. Those written submissions shall be exchanged between counsel for Mr. Fiksel and Mr. Zigler and Mr. Guettler within 14 days of this decision. Thereafter, the submissions of each party are to be submitted within that time frame to my judicial assistant at Barrie.

DiTOMASO J.

Date: May 4, 2015

[^1]: Statement of Claim, Chelmarc et al v. Barris et al, CV-13-1515-00, April 8, 2013, tab 3.

[^2]: Ibid, subparas 1(f) and (g)

[^3]: Endorsement of Justice Skarica, Chelmarc et al v. Barris, CV-13-1515, July 16, 2013, tab 4.