Court File and Parties

COURT FILE NO.: 3524/17 and 4619/17 DATE: 2018-07-18 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

3524/17 Paria Shahverdi also known as Paria Shahverdi Azarbaijani Plaintiff – and – Hassan Talani, Vladimir Ilioukevitch, Oksana Ilioukevitch, 10228796 Canada Ltd., Maryam Mohajer-Ashjai, Saloumeh Baghbani, Luis Melo, Reza Bigideli and Said Seyed Najbaei Defendants

No one appearing for the Plaintiff, Paria Shahverdi also known as Paria Shahverdi Azarbaijani E. Mazinani, Defendant, Hassan Talani W. Greenspoon-Soer, for the Defendants, 10228796 Canada Ltd., Vladimir Ilioukevitch, and Oksana Ilioukevitch Lawrence Hansen and Christopher Statham, Counsel for the Defendant, Luis Melo M. Belanger for S. Baghbani No one appearing for the Defendants, Reza Bigideli and Said Seyed Najbaei

AND BETWEEN:

4619/17 10228796 Canada Ltd. Plaintiff -and- Hassan Talani Defendant

AND BETWEEN: Hassan Talani Plaintiff by Counterclaim -and- 10228796 Canada Ltd., Seyed Shansealdin Najbaei a.k.a. Seyed Najbaei, Laman Meshadiyeva and Louis Melo Defendants by Counterclaim

W. Greenspoon-Soer, for the Plaintiff, 10228796 Canada Ltd. E. Mazinani for the Defendant, Hassan Talani M. Belanger for S. Baghbani, intervenor M. Kestenberg for Laman Meshadiyeva

HEARD: July 3, 2018

REASONS FOR JUDGMENT

Kurz J.

[1] These are my reasons in three motions for summary judgment brought in two related actions. The actions deal with second and third mortgages registered against the same property, municipally known as 435 Elgin Mills Road West, Richmond Hill. Ontario (“Elgin Mills”). That property is registered in the sole name of Hassan Talani (“Talani”), a defendant in both actions.

[2] On March 17, 2017, Hassan granted and registered a second mortgage against Elgin Mills to Vladimir Ilioukevich and Oksana Ilioukevich, for $450,000 (“the second mortgage”). On May 19, 2017, the Ilioukevichs transferred their interest in the second mortgage to 10228796 Canada Ltd. (“102”).

[3] On March 28, 2017, Hassan granted and registered the third mortgage against Elgin Mills to Luis Melo (“Melo”) for $135,000 (“the third mortgage”).

[4] Prior to granting both mortgages (“the mortgages”) and obtaining the loan funds on the mortgages, Talani had represented and declared under oath to 102 and Melo that he was not a spouse and that Elgin Mills was not a matrimonial home.

[5] The mortgages have gone into default. Both mortgagees seek to enforce their mortgages. Talani resists those attempts at enforcement. In granting summary judgment on all three motions, I reject Talani’s arguments challenging the validity of the mortgages and his attempts to blame the lawyers who previously represented him and his wife.

The Parties, the Proceedings and the Motions

The Paria Action

[6] Talani is the separated husband of Paria Shahverdi Azarbaijani (“Paria”), the Plaintiff in court file number 3524/17 (“the Paria action”). Talani and Paria signed a separation agreement on April 3, 2014. The agreement was prepared by Paria’s matrimonial lawyer, Saloumeh Baghbani (“Baghbani”).

[7] The statement of claim in the Paria action was issued on August 31, 2017. In that proceeding, Paria sought various relief against nine defendants. She sought damages, leave to issue a certificate of pending litigation (“CPL”) against Erin Mills, and an order discharging each of the mortgages. She also sought damages for solicitor’s negligence against Baghbani.

[8] On September 14, 2017, Paria obtained leave to register a CPL against Elgin Mills. Talani attended at the supposedly ex-parte hearing but did not oppose the relief requested.

The 102 Action

[9] On September 8, 2017, 102 commenced a mortgage action against Talani, seeking payment of the outstanding second mortgage and possession of Elgin Mills (“the 102 action”). In his statement of defence and counterclaim in the 102 action, Talani does not deny receiving the mortgage funds on the second mortgage. Instead, he pleads that both of the mortgages are unenforceable as he was a spouse to Paria and that Erin Mills was a matrimonial home at the time that the mortgages were registered.

[10] Talani counterclaimed for $1,000,000 against 102, Melo, Seyed Shansealdin Najbaei (“Najbaei”), his real estate broker and Laman Meshadiyeva (“Meshadiyeva”), his real estate lawyer.

[11] Paria’s claim against Reza Bigideli and Seyed Shansealdin Najbaei (“Najbaei”) were discontinued.

Motion for Summary Judgment in the Paria Action

[12] In the Paria action, each of Melo, the Ilioukevitchs and 102 move for summary judgment on Talani’s counterclaim against them. In addition, the Ilioukevitchs and 102 move to discharge the CPL, for a declaration that the second mortgage is valid, and a writ of possession for Elgin Mills.

[13] After he brought those motions, every remaining party in the Paria action but Talani agreed to an order:

• lifting the CPL;
• declaring the second mortgage valid and binding as against Paria;
• granting 102 possession of Elgin Mills as against Paria and her adult daughter, Mehta Talani;
• granting 102 leave to issue a writ of possession for Elgin Mills; and
• an order dismissing Paria’s action against the Ilioukevitchs, 102 and Melo.

[14] Talani’s counsel states that he opposes the consent order because Paria is not withdrawing her claim against him.

Motion for Summary Judgment in the 102 Action

[15] In the 102 action, both 102 and Meshadiyeva move for summary judgment. 102 seeks to amend its statement of claim to include increased costs under the mortgage, judgment on the mortgage, and an order dismissing Talani’s counterclaim against 102. Meshadiyeva seeks to dismiss Talani’s counterclaim against her.

Background

[16] Talani and Paria married on October 5, 1989. They separated on January 3, 2013. During the course of their marriage, they acquired and/or held an interest in two real properties, Elgin Mills and 67 Vivaldi Drive, Thornhill, Ontario (Vivaldi”). Vivaldi was originally owned jointly by the parties while Elgin Mills was always registered in the name of Talani.

[17] Much of the conflict in the two actions centres on whether Vivaldi or Elgin Mills was the parties’ matrimonial home at the time of their separation. That finding is highly relevant to the determination of the propriety of the mortgages.

[18] During the course of obtaining five different mortgages following his separation from Paria (including the pones before me in these two actions), Talani swore declarations to the prospective mortgagees that he was not a spouse. By implication, he represented to them that Elgin Mills was not a matrimonial home. However, Talani takes the opposite tack in these proceedings. He claims that Elgin Mills was a matrimonial home when he granted the mortgages. If that were true, Talani would not have been entitled to encumber it without Paria’s consent. Because he lacked that consent, and hence because of his own alleged impropriety in granting the two mortgages, Talani claims that they are void and unenforceable.

[19] In her affidavit sworn in her action, Paria deposes that Vivaldi was her and Talani’s only matrimonial home at the time of separation. That view echoes the position that both Paria and Talani agreed to in their separation agreement of April 3, 2014. They also agreed that Elgin Mills was an investment property.

[20] The separation agreement was prepared by Baghbani, based on instructions provided to her by Paria. Each of Paria, Talani and Baghbani say that Baghbani represented only Paria in the drafting of the separation agreement. The separation agreement itself refers to Baghbani representing only Paria. It contains Talani’s waiver of independent legal advice.

[21] However, a review of Baghbani’s file also shows that Talani had some input into the drafting of the separation agreement and that he reviewed it before he signed it. She prepared two drafts of the separation agreement before it was signed. On the second draft, she placed a notation that the draft was “ …looked over with Both [sic] April 3, 201[sic]”.

[22] Baghbani’s file also contains a note, dated April 3, 2014, of what appears to be a meeting with both Paria and Talani. That note sets out the reasons that Paria and Talani gave for wishing to include certain terms in the separation agreement. Among those terms were provisions regarding title to Elgin Mills.

[23] The separation agreement called for the transfer of Vivaldi, the matrimonial home, to Paria alone. With regard to Elgin Mills, the agreement described it as “the investment property”. The less than elegantly drafted agreement stated:

Paria will have interest in the investment property though Hassan [Talani] is the sole owner on title of the investment property. Hassan will transfer his interest in the investment property to Paria, free of all encumbrances except for existing mortgage. The mortgage will be in his name. [ note: syntax unchanged]

[24] While Talani transferred his interest in Vivaldi to Paria, he never transferred his interest in Elgin Mills to her. Neither he nor Paria ever registered a matrimonial home designation against Elgin Mills.

Issues

[25] In resisting the summary judgment motions brought against him, Talani argues that the mortgages are void against him for two reasons. First, as set out above, he argues that he was not entitled to transfer his interest in Elgin Mills without Paria’s consent. Second, he argues that the terms of prior mortgages registered against Elgin Mills forbade him from granting subsequent mortgages without leave, which he never obtained. 102 and Melo deny each of these allegations and state that there is no evidence to support them but Talani’s bald allegations. They add that, having allegedly or actually breached other people’s rights, he seeks to benefit from his admitted misdeeds.

[26] With regard to his own real estate lawyer, Meshadiyeva, Talani argues that she was or should have been aware that he was a spouse and that Elgin Mills was a matrimonial home. Thus he contends that Meshadiyeva was at least partially liable for his allegedly improper granting of the mortgages.

[27] He adds that Meshadiyeva and his real estate agent, Najbaei, were both aware that he suffered from a gambling addiction. He claims that they took advantage of that addiction. He offers no evidence:

1. of that alleged addiction save for his word and some correspondence from three casinos showing the amounts that he gambled. The one from Casino Rama attaches a statement and says that it is unable to confirm the accuracy of the statements;
2. from an expert on gambling addiction, showing that he received that diagnosis;
3. that he told Meshadiyeva of his alleged gambling addiction; or
4. of any reason for her to be aware of that alleged addiction.

[28] Meshadiyeva counters by adopting the arguments of 102 and Melo. In arguing that Talani has failed to produce any evidence that she knew of his misbehavior, Meshadiyeva asserts that Talani lied to her as well as to 102 and Melo. She adds that she had limited involvement with Talani.

[29] With all of the above in mind, I must consider whether there is a genuine issue for trial in regard to the following issues:

1. Was Elgin Mills a matrimonial home at the time that Talani granted the mortgages to 102 and Talani?
2. Did 102 and/or Melo know or should they have known that Talani was a spouse at the time that the mortgages were registered?
3. Were the mortgages void because of the terms of prior mortgages that prohibited subsequent mortgages?
4. Was Meshadiyeva partially or fully liable for any damages that may arise out of the mortgages?
5. Is it appropriate to grant partial summary judgment in the Paria and 102 actions?

[30] For reasons set out in greater detail below, I find that the answer to all four questions is no.

Law Regarding Summary Judgment

[31] These motions are brought under R. 20.01 of the Rules of Civil Procedure. The terms of R. 20.04 are mandatory: the court shall grant summary judgment if it is satisfied that there is no genuine issue for trial with respect to a claim or defence (see also Hryniak v. Mauldin, 2014 SCC 7 (“Hryniak”) at para. 68 and Mega International Commercial Bank (Canada) v. Yung, 2018 ONCA 429 (“Mega International”) at para. 83).

[32] The principles under which the court makes the determination of a genuine issue for trial are set out by the Supreme Court of Canada in paras. 44-45, 49-50 and 66 of Hryniak.

[33] The term "no genuine issue for trial" has been variously interpreted to reflect the notion that the responding party cannot possibly succeed, even if granted the right to a full trial. Among the terms that have been used to describe the test are the following:

1. "no chance of success"; or
2. "plain and obvious that the action cannot succeed"; or
3. "manifestly devoid of merit" (see Bedard v. Huard, [2000] O.J. No. 969 (S.C.J.), at para. 7, citing Iaboni et al v. Fowles-Brown, [2000] O.J. No. 479, (S.C.J.); or
4. “the outcome is a foregone conclusion” (Catholic Children’s Aid Society of Toronto v. O. (L.M.), [1996] O.J. No. 3018 (O.C.(G.D.)), at para. 80); or
5. no realistic possibility of an outcome other than that sought by the applicant (Children's Aid Society of Toronto v. S.D., [2016] O.J. No. 228 (O.C.J.), at paras. 9-10).

[34] There will be no genuine issue requiring a trial if the summary judgment process allows the court to reach a fair and just determination on the merits on a motion for summary judgment. That will be the case when the process (1) provides the court with the evidence required to fairly and justly adjudicate the dispute by making the necessary findings of fact, (2) allows the judge to apply the law to those facts, and (3) is a proportionate, more expeditious and less expensive means to achieve a just result. (see Hryniak at para. 49 and 66).

[35] Each party to a motion for summary judgment has an obligation to “… ‘put its best foot forward’ with respect to the existence or non-existence of material facts that have to be tried” (Ramdial v. Davis (Litigation Guardian of), 2015 ONCA 726, [2015] O.J. No. 5630 (O.C.A.) at para. 27, citing Papaschase Indian Band No. 136 v. Canada (A.G.), 2008 SCC 14, [2008] 1 S.C.R. 372, at para 11).

[36] The onus for proving that there is no genuine issue for trial rests with the moving party. However in response to the evidence of the moving party, the responding party may not rest on mere allegations or denials in the party’s pleadings. That party must set out in affidavit material or other evidence, specific facts showing that there is a genuine issue requiring a trial. A self-serving affidavit is not sufficient itself to create a genuine issue for trial in the absence of detailed facts and supporting evidence. (see R. 20.01(2) and Guarantee Co. of North America v. Gordon Capital Corp., [1999] 3 S.C.R. 423, at para. 31).

[37] In the oft-repeated maxim of Justice Coulter Osborne, then of the Ontario Court of Appeal, the responding party to a motion for summary judgment must “lead trump or risk losing” (106150 Ontario Ltd. v. Ontario Jockey Club, [1995] O.J. No. 132 (O.C.A.), at para. 35, the principle was reaffirmed in Ramdial v. Davis (Litigation Guardian of), supra, at para. 28).

[38] The court is entitled to assume that the record before it is complete, that it contains all of the evidence that a party would present if there were a trial (Broadgrain Commodities Inc. v. Continental Casualty Company (CNA Canada), 2018 ONCA 438, at para. 8, citing Dawson v. Rexcraft Storage & Warehouse Inc., 111 O.A.C. 201, at para. 17; Sweda Farms Ltd. v. Egg Farmers of Ontario, 2014 ONSC 1200, at paras. 27, 33-34, aff’d 2014 ONCA 878, leave to appeal to SCC refused, [2015] S.C.C.A. No. 97; and Tim Ludwig Professional Corporation v. BDO Canada LLP, 2017 ONCA 392, at para. 54).

[39] Once the moving party discharges the burden of showing that there is no genuine issue for trial, the onus shifts to the responding party. That party must then provide evidence of specific facts showing that there is a genuine issue requiring a trial (Ramdial v. Davis (Litigation Guardian of), at para. 30). An adverse inference may be drawn from a failure to support the allegations or denials in a party’s pleadings (Pearson v. Poulin, 2016 ONSC 3707, at para. 40).

[40] Under R. 20.04(2.1) the court may exercise enhanced powers on the motion unless it is in the interest of justice to do so at trial. Those enhanced powers allow the court to weigh the evidence, evaluate the credibility of a deponent, and draw any reasonable inference from the evidence. As Paciocco J.A. wrote for the Ontario Court of Appeal at para. 83 of Mega International, those powers “... are presumptively available to a summary judgment motion judge to use to fairly and justly adjudicate a claim at a motion for summary judgment” (Hryniak, at para. 45). The court is not required to resort to those powers to make up for a party’s evidentiary shortcomings (see Broadgrain Commodities Inc. v. Continental Casualty Company (CNA Canada), 2018 ONCA 438 at para. 8).

Issue No. 1: Is there a genuine issue requiring a trial as to whether Elgin Mills was a matrimonial home at the time that Talani granted the mortgages to 102 and Melo?

[41] Under s. 21 (1) of the Family Law Act, no spouse shall dispose of or encumber an interest in a matrimonial home unless:

(a) the other spouse joins in the instrument or consents to the transaction; (b) the other spouse has released all rights under this Part by a separation agreement; (c) a court order has authorized the transaction or has released the property from the application of this Part; or (d) the property is not designated by both spouses as a matrimonial home and a designation of another property as a matrimonial home, made by both spouses, is registered and not cancelled.

[42] The court may set aside a transaction that violates s. 21(1):

… unless the person holding the interest or encumbrance at the time of the application acquired it for value, in good faith and without notice, at the time of acquiring it or making an agreement to acquire it, that the property was a matrimonial home.

[43] Section 21(3) of the Family Law Act sets out the minimum standard of proof required to avoid a court setting aside a transaction regarding a property because it was a matrimonial home at the time of the transaction. It states:

(3) For the purpose of subsection (2), a statement by the person making the disposition or encumbrance,

(a) verifying that he or she is not, or was not, a spouse at the time of the disposition or encumbrance; (b) verifying that the person is a spouse who is not separated from his or her spouse and that the property is not ordinarily occupied by the spouses as their family residence; (c) verifying that the person is a spouse who is separated from his or her spouse and that the property was not ordinarily occupied by the spouses, at the time of their separation, as their family residence; (d) where the property is not designated by both spouses as a matrimonial home, verifying that a designation of another property as a matrimonial home, made by both spouses, is registered and not cancelled; or (e) verifying that the other spouse has released all rights under this Part by a separation agreement,

shall, unless the person to whom the disposition or encumbrance is made had notice to the contrary, be deemed to be sufficient proof that the property is not a matrimonial home.

[44] Talani swore declarations and made statements in regard to both of the mortgages to the effect that he is not a spouse and that he is the only owner of Elgin Mills. Implicit in each of those statements is the representation that Elgin Mills is not a matrimonial home.

[45] Talani made similar declarations, statements and implicit representations in regard to four previous mortgages that he obtained for Elgin Mills.

[46] Talani does not deny making any of those numerous representations.

[47] Those statements meet the requirements of s. 21(3)(a) of the Family Law Act.

[48] Talani also signed a separation agreement with Paria in which he acknowledged that Elgin Mills was an investment property and that Vivaldi was the matrimonial home. He initialed each page of that agreement. When each of he and Paria attended before Baghbani, they presented her with driver’s licences, which she photocopied, showing Vivaldi as their address. That is the address for each found in Baghbani’s intake form.

[49] On January 31, 2017, both Talani and Paria returned to meet Baghbani. Her contemporaneous notes of the meeting with both parties refers to Elgin Mills, stating that “… Rental helps them pay mortgage and may get some money in pocket + always has been and will be rental property.”

[50] Baghbani asserted in the body of her affidavit that Paria stated, in the presence of Talani, that “… the rental income from the investment property (the Richmond Hill property) [i.e. Elgin Mills] helped them pay for the mortgage and put some money in their pockets. She confirmed that the property was and always would be a rental property.”

[51] Baghbani added that Talani wanted to move into the Elgin Mills property but that he and Paria agreed that they needed the rental income and that they wanted the property to go to their children.

[52] These are clearly statements made and contemporaneously recorded by a professional with an obligation to do so. Talani has not questioned the admissibility or accuracy of the notes or statements that Baghbani makes about their meetings in her affidavit.

[53] The only evidence that Talani advances to gainsay these statements about the status of Elgin Mills are the following:

1. A series of bald statements in his affidavit about Meshadiyeva, to the effect that she “…had actual or constructive notice that the Elgin Mills property was a matrimonial home and that I was the spouse of Paria… and her consent was required for the transaction.”
2. A statement that the mortgage agent who assisted him in obtaining the mortgages, Najbaei, introduced him to Meshadiyeva.
3. Reference to the driver’s licence histories of both himself and Paria, showing that they alternated their addresses for licence purposes between Vivaldi and Elgin Mills. On January 3, 2013, the date of separation, both listed their address as being Elgin Mills. However, Paria changed the address to Vivaldi on April 17, 2013. For his part, Talani changed his address from Vivaldi to Elgin Mills on March 26, 2012, then back to Vivaldi on March 27, 2013, and then back again to Elgin Mills on March 3, 2017.

[54] Talani’s counsel argues that the evidence that he provides is sufficient to raise an issue of credibility that requires a trial. I do not agree. Assuming, as I am entitled to do, that the evidence cited above is Talani’s only evidence, there is no genuine issue that requires a trial on the issue of whether Elgin Mills was a matrimonial home at the time of the registration of the mortgages.

[55] The allegations about Meshadiyeva are the kind of evidence that R. 20.02 (2) states are inadequate to avoid summary judgment. They are mere bald allegations. They do not offer specific evidence or facts showing a genuine issue for trial. Talani cannot even say whether Meshadiyeva had actual or merely constructive knowledge of the true status of himself and Elgin Mills.

[56] Further, Talani cannot point to any facts that show why Meshadiyeva should have either form of knowledge, other than the fact that he was introduced to her by a mortgage broker who purportedly knew the truth. To prove that the broker had the knowledge he ascribes to her, he attaches an email to his affidavit, presumably in Farsi, from that broker to a third party. Superimposed by hand on the copy of that email in Talani’s affidavit is what appears to be a translation by an unknown person of the Farsi email.

[57] There are many problems with that email and translation that make them inadmissible. They include the facts that the email is hearsay and not properly placed in evidence, the identity of the recipient is unknown, the language of the email is unstated, and nothing in the affidavit explains the handwriting that I assume is a translation. In any event, the presumed translation is inadmissible under the operation of s. 125 of the Courts of Justice Act. That provision requires that documents filed in court that are not in the English language be “accompanied by a translation of the document into the English language certified by affidavit of the translator.”

[58] Thus, other than Talani’s very broad, vague, self-serving and unsubstantiated allegations, the only evidence that he offers to prove that Elgin Mills was a matrimonial home is the driver’s licence abstracts. As set out below, they are far from sufficient to raise a genuine issue for trial in light of the other evidence brought forward. Talani offers no sworn chronology of his residency from the time of the purchase of the two homes that would match the addresses in the driver’s licences. He offers no evidence to explain how both he and Paria came to change their driver’s licence address back and forth between Vivaldi and Elgin. He offers no evidence of a witness who can speak to the use of Elgin Mills as a matrimonial home. I note that driver’s licence addresses can be changed online.

[59] On the other hand, the court has the sworn declarations of Talani and the joint statements of both parties in the separation agreement that Elgin Mills is a rental property. To that I add the evidence and records of Baghbani. What is particularly important about those statements is that they were either made by both parties or by one in the presence of and without opposition by the other.

[60] Because of the strong evidence mustered by parties other than Talani (much of which came from Talani’s own statements), I have found that 102 and Melo have met their onus of providing proof that there is no genuine issue for trial regarding whether Elgin Mills was a matrimonial home at the time of the mortgages. On the other hand, for the reasons set out above, I find that Talani has failed to meet his onus of proving that there is a genuine issue for trial.

[61] If I am wrong, I resort to my enhanced powers to say that Talani is simply not credible when I compare his statements and supporting evidence against the evidence mustered by 102 and Melo. I say this because:

1. Talani is not a credible witness. The only issue is when he lied, whether it was to this court or when he obtaining mortgages, claiming that he is not a spouse.
2. If he is willing to lie when he feels that it is in his interest to obtain mortgages, why would he not do the same to avoid the effect of the mortgages he obtained in part through his lies?
3. Talani claims that he did not know the difference between a spouse and a non-spouse. But when he granted the first mortgage on Elgin Mills to Computershare Trust Company of Canada, on or about March 28, 2012, prior to his separation, he accurately said that he was a spouse.
4. Talani also claims that he obtained mortgages in violation to terms contained in previous mortgages that forbade subsequent mortgages. Yet he signed those mortgages. He does not deny knowledge of their terms when he signed them. Again, by his own word, he is willing to be dishonest when it suits his interests.
5. In contrast to his self-serving statements to the court, Talani’s statements in the separation agreement had the ring of truth. They were contained in a joint document, signed by both himself and Paria. The same is true in regard to their January, 2017 oral statements to Baghbani about Erin Mills being an investment property. In each of them, it was open to Talani to state in the presence of Paria (and Baghbani) the alleged truth that Erin Mills was a matrimonial home. Of course, he ran the risk of Paria calling him out on those statements.

[62] I raise one other important point that applies to many of Talani’s arguments. He relies on technical arguments based on statutes and mortgage terms that are designed to protect third parties like Paria and other mortgagees from the very kind of conduct in which he said that he engaged. The matrimonial home designation would have protected Paria from his dishonesty in obtaining mortgage money from Elgin Mills in violation of the terms of the separation agreement. Yet at this time, Paria is not denying the validity of the mortgages. She has settled with 102 and Melo. Similarly, there is no previous mortgagee coming forward to claim that he violated a term forbidding subsequent mortgages. In fact, there is no evidence that the first mortgage even has such a term.

[63] Talani’s arguments brush up against the common law doctrine of ex turpi causa non oritur action. As Blair J.A., writing for the Ontario Court of Appeal in Livent Inc. (Special Receiver and Manager of) v. Deloitte & Touche, 2016 ONCA 11, stated, the term:

… means "from a dishonourable cause an action does not arise". The statement of Lord Mansfield in Holman v. Johnson (1775), 98 E.R. 1120, at p. 1121, has often been cited as authoritative:

No Court will lend its aid to a man who founds his cause of action upon an immoral or an illegal act. If, from the plaintiff's own stating or otherwise, the cause of action appears to arise ex turpi causa, or the transgression of a positive law of this country, there the Court says he has no right to be assisted. It is upon that ground the Court goes; not for the sake of the defendant, but because they will not lend their aid to such a plaintiff.

[64] Strictly speaking, the doctrine is a defence to a claim by a malefactor, to the effect that he or she should not profit from their misconduct. The doctrine is rarely used in Canada, and only in narrow circumstances. As Blair J.A. summarized after reviewing the two key Supreme Court of Canada cases on the doctrine:

The application of the ex turpi causa doctrine has therefore been strictly limited in Canada. It will apply only where allowing a plaintiff's claim would introduce inconsistency into the fabric of the law - by "giving with one hand what it takes away with the other": per McLachlin J. in Hall, at p. 178, quoted with approval by Rothstein J. in Zastowny, at para. 22.

[65] The doctrine of ex turpi causa was not raised by the moving parties before me and in any event likely does not strictly apply here. Yet the parties do point out that it does not lie in Talani’s mouth to make arguments on behalf of persons who should be protected from the conduct in which Talani claims or admits to have engaged. That is particularly so when the very persons who should be protected do not find it necessary to avail themselves of those protections. In other words, there is something disingenuous about Talani’s resort to s. 21 of the Family Law Act or purported terms of prior mortgages, when he is the one who admits or claims to have breached them.

Issue No 2: Is there a genuine issue for trial as to whether 102 and/or Melo knew or should they have known that Talani was a spouse at the time that the mortgages were registered?

[66] While admitting that he received the advances called for under the mortgages, Talani nonetheless argues that they should be declared null and void. He says this because he was a spouse at the time that he granted the mortgages and Paria did not consent to the mortgages.

[67] Most of the points raised in regard to the first issue apply here as well. They need not be repeated. To them I add that:

1. There is no evidence before the court that either 102 or Melo actually knew that Talani was a spouse when they advanced money to him and accepted his mortgage.
2. In fact, Talani did whatever was necessary to make 102 and Melo believe that he was not a spouse;
3. 102 and Melo are entitled to rely on s. 21(3) of the Family Law Act in regard to Talani’s declarations of spousal status.
4. There is no evidence before the court that would lead it to find that either 102 or Melo should have known that Talani was a spouse when he granted the mortgages. As set out above, Talani’s broad and vague statements about Meshadiyeva’s purported “actual or constructive knowledge of his spousal status and that of Elgin Mills” do not meet his evidentiary obligation on a motion for summary judgment.

[68] Accordingly, there is no genuine issue for trial as to whether 102 or Melo knew or should have known that Talani was a spouse when he granted them mortgages.

Issue No. 3: Is there a genuine issue requiring a trial as to whether the mortgages are void because of the terms of prior mortgages that prohibited subsequent mortgages?

[69] This argument raised by Talani has even less merit than the ones about the status of Elgin Mills and his own spousal status. What it has in common with those other arguments is Talani’s attempts to step into the shoes of parties he alleges or admits to have wronged. No other mortgagee has complained about the existence of the mortgages.

[70] The only mortgage that stands ahead of the mortgages before the court is a first mortgage. I have been provided with no evidence of the terms of that mortgage, let alone that it prohibits subsequent mortgages.

[71] Any other prior mortgages were discharged before the time of the mortgages or shortly after they were registered as part of normal conveyancing.

[72] Further, the arguments that Talani has raised on this point are notably devoid of reference to any authority that would support the proposition that the mortgages would be void ab initio because of a prohibition on subsequent mortgages in a previous one. I am unaware of such an authority. At best it would be a breach of the previous mortgage, which that mortgagee could seek to remedy. That has not occurred. This argument has no merit.

Issue No 4: Is there a genuine issue for trial as to whether Meshadiyeva is partially or fully liable for any damages that may arise out of the mortgages?

[73] I have set out above the meagre evidence that Talani relies upon to impugn Meshadiyeva and claim against her. He has provided no evidence that she has breached any duty of care to him or breached any agreement with him. All that he musters is the notion of knowledge of his impropriety by association; a notion that has no evidentiary basis. He argues that she took advantage of his alleged gambling addiction without proving either the alleged addiction or her knowledge of its existence. If all of this represents Talani’s “best foot”, he has failed to place it forward.

[74] It is not conceivable that Talani would obtain a judgment against Meshadiyeva at trial based on the evidence that he has presented against her in this motion.

Issue No. 5: Is it appropriate to grant partial summary judgment in the Paria and 102 actions?

[75] One final consideration that emerges out of the Hryniak analysis of summary judgment motions is whether it is proportionate and just to grant partial summary judgment as requested in each of the Paria and 102 actions. No party raised that issue but I believe that the authorities set out below require me to consider the issue.

[76] In each action, if I were to grant summary judgment as requested, there will still be remaining issues, ostensibly for trial. In the Paria action, her claim against Talani and Baghbani will continue. So will Talani’s crossclaim against Najbaei. In the 102 action, Talani’s counterclaim against Najbaei will continue.

[77] I note that Paria had earlier discontinued her action against Najbaei and that he filed no pleadings in response to either of Talani’s claims against him. It is not clear whether Talani is proceeding against Najbaei, but if he is, Najbaei has not filed a responding pleading.

[78] In his well-considered analysis of the issue of when partial summary judgment should be granted, Myers J. of this court stated in Mason v. Perras Mongenais, [2018] O.J. No. 1178 (S.C.J.) at para. 18:

… where a trial is required involving the same parties, the same witnesses providing the same evidence about the same facts in issue as are relied upon for summary judgment, the risk of duplication and inconsistent outcomes is particularly acute. In such cases, the benefits of summary judgment as a cost saving or tool for efficiency are lost since a trial is required on all the same facts among all the same parties anyway.

[79] The test, as Myers J. put it at para. 21 was whether:

… the facts and evidence in support of the summary judgment sought are so intertwined with the issues and evidence that will remain for trial so as to fail to meet the requirement of proportionality in the context of the litigation as a whole under Hryniak. By corollary, to avoid cases where the facts and evidence are intertwined with those that will remain for trial, judges have looked for issues for partial summary judgment that are "distinct" from those that will remain for trial.

[80] Myers J. was clear that the test was not designed to default to a trial. Rather the culture shift called for by Hryniak requires a case by case analysis to consider the risk of duplication and inconsistent verdicts in each specific case. There is a spectrum of cases from those in which there will clearly be no overlap or risk of inconsistent findings, to those in which there is a real risk of both results. Many cases are, of course, in the middle. As Myers J. stated, citing both Hryniak and the Ontario Court of Appeal’s decision in Baywood Homes Partnership v. Haditaghi, 2014 ONCA 450:

[33] The Supreme Court of Canada did not impose a bright line rule to default to a trial if there is no wholly discrete or bifurcated issue. Approaching trials as the default process is not a culture shift at all. It perpetuates the practical roadblocks on access to justice that the Supreme Court of Canada identified as being the greatest challenge to the rule of law in Canada. The shift required is an understanding that judges will be deciding cases summarily as much as possible to avoid the expense and delays of the trial process that put civil justice beyond the reach of most Canadians. The shift is that, instead of defaulting to trials, judges will exercise judgment, where possible, to find proportionate processes to allow a fair and just resolution on the facts of each case that avoids the cost and delays of the trial process. If the risk of duplication and inconsistent verdicts is high, then Baywood and Hryniak dictate that a trial is required. But that is the last option not the best one. This requires buy-in to the notion that judges will exercise discretion to determine in each case the amount of process required on the facts and law to give them confidence that the case can be resolved fairly, justly, and proportionately. That is the "culture shift."

[81] Here the partial summary judgment requested by the moving parties will lead to a low risk of overlap and inconsistent findings. By granting the summary judgment requested by the Illioukevichs and 102, they will be removed from the litigation and the issue of the validity of the second mortgage will be finally determined as between mortgagor and mortgagee. The same is true with regard to any claims against Melo regarding the validity of the third mortgage. The only remaining issue will be the discrete claims that Paria makes against Talani and her former solicitor, Baghbani. As Paria’s counsel did not participate in this motion, and in light of the consent by Paria to judgment in the Paria action as set out below, it is far from clear whether the action against Baghbani will still proceed.

[82] With regard to the 102 action, if summary judgment is granted, 102 will be able to enforce its second mortgage. Meshadiyeva will be removed from the action. Talani’s claim against Melo will be dismissed and the issue of the validity of the third mortgage will not be before the court. The remaining issue will be Talani’s discrete claim against Najbaei. As set out above, Najbaei has not responded to that claim.

[83] In other words, partial summary judgment is a proportionate and just measure in keeping with the principles of Hryniak. There is little intertwining of issues determined and remaining for trial and little risk of inconsistent findings.

Conclusion

[84] For the reasons set out above, I grant summary judgment as requested in the notices of motion of each of the Ilioukevitchs, 102, Melo, and Meshadiyeva as set out below.

[85] In the Paria action, I order as follows:

1. On consent, Talani not objecting, the certificate of pending litigation granted by Gray J. on September 17, 2017 is lifted.
2. On consent of all remaining parties to the main action but Talani: i. The second mortgage is valid and binding as against Paria; ii. 102 is granted judgment for possession of Elgin Mills against Paria and her daughter, Mehta Talani. iii. 102 has leave to issue a writ of possession for Elgin Mills as of August 1, 2018. iv. This action is dismissed, without costs, as against the Ilioukevitchs, 102 and Melo.
3. Talani’s crossclaim against each of the Ilioukevitchs, Melo and 102 is dismissed.

[86] In the 102 action, I order:

1. On consent, that the statement of claim shall be amended in the manner set out at Schedule “A” to the amended notice of motion of 102 dated March 15, 2018;
2. Judgment against Talani for all amounts due to 102 under the second mortgage. If there is any issue in that regard, Talani and 102 may arrange to attend before me to determine that amount;
3. Talani’s counterclaim against 102, Melo and Meshadiyeva shall be dismissed;

[87] Each party claiming costs may file a three-page written submission (plus any costs outline, offer to settle, dockets and authorities upon which they rely) within 14 days. Talani may respond within a further 14 days.

Kurz J. Released: July 18, 2018

COURT FILE NO.: 3524/17 DATE: 2018-07-18 ONTARIO SUPERIOR COURT OF JUSTICE BETWEEN: Paria Shahverdi also known as Paria Shahverdi Azarbaijani Plaintiff – and – Hassan Talani, Vladimir Ilioukevitch, Oksana Ilioukevitch, 10228796 Canada Ltd., Maryam Mohajer-Ashjai, Saloumeh Baghbani, Luis Melo, Reza Bigideli and Said Seyed Najbaei Defendants AND BETWEEN: 10228796 Canada Ltd. Plaintiff -and- Hassan Talani Defendant REASONS FOR JUDGMENT Kurz J. Released: July 18, 2018