COURT FILES NO.: CV-17-63377, 17-63374, CV 17-63375 SR, CV-17-63376
DATE: 2020/10/14
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
2257573 Ontario Inc.
Howard W. Reininger, for the Plaintiff/Defendant by Counterclaim/Moving Party
Plaintiff/Defendant by Counterclaim/
Moving Party
- and -
Alex Aiden Fitzgerald Furney also known as Alex Furney, Maryam Furney and Hassan Hashemi
Trent Morris for the defendants, plaintiffs by counterclaim.
Defendants/ Plaintiffs by Counterclaim
HEARD: August 13, 2020
TURNBULL, J.
[1] The plaintiff corporation brought a motion for summary judgment on a series of mortgages it had granted to the defendants. The defendants counterclaimed for damages suffered due to the plaintiff’s failure to fulfill their alleged oral agreement relating to the discharge of a three executions registered against the defendant Maryam Furney as part of the refinancing arrangements. The plaintiff brought a motion for summary judgment with respect to four mortgages held on four different properties. The parties negotiated three mortgage commitments with respect to the transactions. For ease of reference, they are briefly summarized herein.
The First Mortgage Transaction: Action CV 17-633375:
[2] The parties signed a mortgage commitment for this transaction on February 17, 2017.
[3] The plaintiff registered a third mortgage for $82,000 against the property owned by Mary Ann Furney at 253 Four Mile Creek Road, Niagara-on the Lake. The defendant Mr. Hashemi permitted the plaintiff to register a collateral mortgage against the property he owned at 428 Dundas Street, Woodstock Ontario. All defendants guaranteed the loan. As part of this transaction, Mr. Hashemi used the funds to pay out the existing third mortgagee and to take an assignment of that mortgage.
The Second Mortgage transaction: Action CV 63376:
[4] A mortgage commitment was drafted by the plaintiff with respect to only the above two properties and signed on February 28, 2017 by the defendants.[^1]
[5] The plaintiff ultimately advanced $557,722.98.00 to pay out the first and second mortgages registered against 253 Four Mile Creek Road, Niagara-on-the-Lake. They were in default at that time. The plaintiff argued that $600,000 was actually advanced but further in this ruling, I reject that submission and offer my reasons for doing so.
[6] The commitment originally provided that a first mortgage would be registered in favour of the plaintiff against 253 Four Mile Creek and that Mr. Hashemi would postpone his third mortgage in respect of which he had received an assignment. Because of outstanding judgments against Ms. Furney, the plaintiff took an assignment of those two mortgages. The mortgages against 1384 York Road and 419 Progressive Avenue acted as collateral security for the loan.
[7] This created the nub of the issue in these proceedings. The defendants argue that the plaintiff, as part of this transaction, was obliged to pay out the outstanding executions against Ms. Furney so that she and her husband could refinance their various properties to repay the plaintiff. The plaintiff denies he ever contracted to pay out all the judgments in advancing the funds in this transaction or in any or all of them.
The Third Mortgage Transaction: Actions CV 63377 and CV 63374:
[8] A third mortgage commitment was also signed with respect to this transaction on March 9, 2017.[^2]
[9] The total advanced under this agreement was $249,000. A third mortgage for $105,000 was registered against Mr. Hashemi’s property at 428 Dundas Street, Woodstock and a third mortgage for $179,075 was registered against the property owned by Alex Furney at 429 Progressive Avenue, Niagara-on-the-Lake. After the plaintiff’s legal fees were deducted, the plaintiff advanced approximately $245,000. When registering the mortgage, the solicitor for the plaintiff noted on the mortgage documents that two of the judgments against the Furney defendants were to be paid with the funds advanced to their solicitor. One of them was not paid and the third judgment, showing approximately $291,000 was not mentioned.
[10] In these reasons, I refer to each of these transactions respectively as the first, second and/or third transaction (as I did in my earlier ruling ordering a min-trial).
[11] After hearing initial submissions from counsel, I released written reasons which were issued to the parties[^3] in which I outlined the evidence and positions of the parties as presented by counsel and in the written materials. I directed that a “mini trial”[^4] be conducted to hear viva voce evidence from the plaintiff and the defendants Mr. Hashemi and Ms. Furney to determine if there is a genuine issue requiring a trial of the plaintiff’s actions. The affidavits of Anil Kingrani, the principal shareholder and directing mind of the plaintiff, Ms. Furney, and Mr. Hashemi filed on these motions were directed to constitute their examinations in chief. I directed that each of these people be cross-examined before the court, reserving a right of re-examination to their counsel.
[12] Due to the intervention of COVID-19, the court schedule was disrupted. Despite efforts to conduct an “in court” hearing, counsel ultimately agreed to have the evidence heard by Zoom hearing on August 13, 2020. After listening to the cross-examinations and re-examinations of those parties, counsel agreed to file written submissions according to a schedule confirmed by my written endorsement dated August 13, 2020. I have now received those submissions from counsel in September 2020, for which I thank them.
Evidence of Anil Kingrani on the “Mini Trial”
[13] Mr. Kingrani is the principal of the plaintiff corporation. He is a businessman who was educated as an engineer in Pakistan before immigrating to Canada in 2001. He became active in an import/export business and in due course got into the land development business. He recalled that he first met Mr. Hashemi when he (Kingrani) was having a house constructed and Hashemi, an electrician, came to the property to do some work. His best recollection was that that meeting occurred sometime in February 2017. Subsequently, they discussed the financing needs of Mr. Hashemi’s friends Maryam and Alex Furney. Mr. Kingrani recalled travelling to Niagara on the Lake with Mr. Hashemi and stated it was his first time visiting that municipality. He recalled doing a drive-by of the Furney properties. While he was uncertain of all of the details, Mr. Kingrani agreed that Mr. Muthu,[^5] a mortgage agent employed in the same mortgage brokerage as Ms. Furney, approached him about providing financing for the first mortgage transaction in question.
[14] With respect to the first mortgage transaction, Mr. Kingrani believed that he would be paid out in a very short period of time because the property owned by Ms. Furney at 253 Four Mile Creek Road was subject to a pending sale to a party named Kennelly. Ultimately, that transaction did not close. As a result, the Furneys were left in a difficult financial position which led to the second and third mortgage transactions in issue.
[15] Mr. Kingrani did not agree with Mr. Morris’ suggestion that the only viable commercial reason that two properties were provided as security in the second transaction was to pay out all three executions. He stated that he wanted both properties to secure the second mortgage advance because there was insufficient equity in just 419 Progressive Avenue. In his view, Ms. Furney had overstated the value of that property. This was confirmed in the affidavit of Mr. Muthu, which was not challenged by the defendants in this proceeding. He was not cross examined on his affidavit prior to arguing this motion, nor was leave sought to have him cross examined viva voce on the “mini trial”.
[16] Mr. Kingrani denied that he promised to pay off all the outstanding judgments. He noted that the third transaction provided for payment of two of the judgments. He denied, and I accept his evidence, that he also committed to pay out the Cruz judgment [^6] for $291,000. He rhetorically asked “why should I pay out that judgment”. While he could not recall the subsequent efforts of Ms. Furney to have him provide additional refinancing to her on a property at 1728 York Road, I accept his evidence that he was not angry with her because she did not refinance that property with him.
[17] In her email to Mr. Kingrani of March 7, 2017,[^7] Ms. Furney alluded to problems she was having with respect to refinancing 1728 York Road due to alleged improper conduct on the part of Mr. Muthu. There is no reference to any promise of Mr. Kingrani to refinance that property. The email exchanges during the month of March 2017 do not make any mention of any alleged breach of agreement to pay out the Cruz judgment.
[18] Mr. Morris, in his written submissions, argued that Mr. Kingrani’s evidence was unreliable, partly because he was unable to recall a number of details involving the numerous interactions among the parties’ involved. I do not accept that submission. I found Mr. Kingrani tried to answer the questions put to him in as forthright a manner as possible and I do not find it is unreasonable that he was unable to recall every conversation or interaction three and one-half years after the events.
[19] In his cross-examination, Mr. Kingrani acknowledged that the amounts claimed in the discharge statements were reviewed by him before being sent to the mortgagors. He denied that he knew that the charges constituted a criminal rate of interest. I accept his evidence on this point, which is confirmed by the fact that his counsel agreed such charges were not tenable before this court.
Evidence of Maryam Furney on the “Mini Trial”.
[20] Ms. Furney’s position was clear from her evidence. She insisted that the sole reason she agreed to short term, high interest rate mortgages to the plaintiff was to provide her with sufficient funds to pay out the existing judgments against her and to put the Subprime and Elle mortgages registered against title to her property at 253 Four Mile Creek into good standing by having them assigned to the plaintiff. She testified that then she expected to be able to sell or refinance the properties to pay the plaintiff out in due course.
[21] Ms. Furney was cross-examined vigorously by Mr. Reininger. She was combative, evasive and repeatedly refused to directly answer questions.
[22] Ms. Furney had been a licenced mortgage broker for approximately 14 years and at the time of these transactions was working with a mortgage brokerage named Trillium Mortgages. In order to work as a mortgage agent, she had to be affiliated with a registered mortgage broker. Ms. Furney approached her principal at Trillium Mortgages to seek out the name of a mortgage professional to help her obtain urgent financing. Her employer connected her with another agent, Mr. Muthu, who in turn introduced her to Mr. Kingrani, the principal of the plaintiff corporation.
[23] Ms. Furney was unable and unwilling to confirm that there was no written document confirming her allegation of the oral agreement with Mr. Kingrani. Instead of simply answering the question, she kept commenting on the fact that because Mr. Kingrani had advanced funds to pay off two of the judgments, it meant inferentially that he had committed to pay off all judgments. I find that she was evasive in her efforts to avoid admitting that there was no agreement in writing verifying the various terms and conditions listed in her affidavit to support her contention as to what the parties had agreed.
[24] Ms. Furney agreed in cross-examination that the agreement with respect to the judgments was probably made late in February 2017 or early March 2017. When confronted with the fact that the first commitment for $82,000 was signed on February 17, 2017, before she asserted there was the alleged verbal agreement to pay off all the judgments, she refused to confirm that fact. In her cross-examination, she was questioned about the second mortgage commitment dated and signed February 28, 2017 for the sum of $610,486.65. It was again pointed out to the witness that this commitment did not provide for payment of the judgments by Mr. Kingrani. It was pointed out to the witness that she was a licensed mortgage agent, familiar with these types of documents, and understood what they meant but she continued to refuse to agree that there was no provision for payment of the judgments in this commitment until it was so agreed by her counsel Mr. Morris. It was also pointed out to the witness that para. 4 of that second commitment states:
“The lender acknowledges the executions registered against borrowers and guarantors”.
[25] Mr. Reininger suggested to Ms. Furney that this provision meant that the lender was agreeing to proceed notwithstanding there were registered executions and judgments and clearly it was not an agreement that he would pay them. Again, Ms. Furney only responded by saying that the evidence that he agreed to pay them was the registered mortgages and refused to acknowledge or agree to the facts put to her.
[26] The witness also identified on the third commitment that there was going to be an advance of $249,920 and that of that advance a writ of execution for $105,000 was going to be paid out which was identified as the Abraham Writ. However, once again Ms. Furney would not agree that the third signed mortgage commitment did not provide for payment of all the judgments nor were the funds being advanced sufficient to do so.
[27] Mr. Reininger asked Ms. Furney to identify a cheque dated March 10, 2017 (the funds being advanced as part of the third mortgage transaction) payable to her lawyer, David Martin, in trust, from the lawyer representing Mr. Kingrani. She agreed the funds were received by her lawyer and partially used to pay off the Abraham execution. She would not agree that it was her lawyer’s responsibility to pay off all or part of the other judgments with the remaining proceeds. In her email to Mr. Kingrani of March 9, 2017[^8] (the day before the third mortgage advance), she wrote in the concluding paragraph “my lawyer will make sure to remove the writs upon payment.” She never explained what happened to the balance of the funds. When asked why the other judgments were not paid off, Ms. Furney stated that one of the execution creditors had inflated the amount owed and there was not enough money to pay them. Mr. Reininger noted that she never provided any evidence to verify that assertion which was the first time in these proceedings that it was raised.
Evidence of Mr. Hashemi on the “Mini Trial”:
[28] Mr. Hashemi testified that he has been a self-employed electrician for approximately 30 years. He owned his family home and the property at 428 Dundas Street in Woodstock.
[29] The evidence of Mr. Hashemi set out in paras. 12-15 of his affidavit sworn October 8th, 2019 alleges that he advised Kingrani that he would not provide any of his properties as security for loans unless the plaintiff intended to pay off existing judgments affecting the properties being financed by the defendant Furneys. During his cross-examination, Mr. Hashemi testified that this was a verbal agreement, it was not reduced to writing, he did not make any notes as it was not his practice to do so, and he did not advise the lawyer representing him of that agreement as he did not see a need to do so.
[30] Mr. Hashemi signed the commitment on February 15, 2017, found at Exhibit “A” to his affidavit, in which he guaranteed a loan to Ms. Furney for $82,000. On cross-examination he was asked when this verbal agreement was made with Mr. Kingrani and he thought it was on or about the time he signed the commitment. Mr. Hashemi was also asked how much the outstanding judgments were. He said approximately a few hundred thousand dollars. He did not know the precise details.
[31] When asked on cross-examination whether the executions for close to $500,000 were to be paid from the advance of $82,000, his response was simply that he would not have agreed to give Kingrani security without the agreement to pay the judgments. He could not satisfactorily answer how he expected to have the judgments paid from the amounts that were being advanced.
[32] I reject his evidence. I have no doubt that if Mr. Hashemi had insisted that all judgments be paid out by the plaintiff, he would have known the amount to be paid out and would have insisted on a breakdown of the amounts to be advanced against various properties to effect that purpose. While he testified that he was an electrician with a high school education and two years of additional study, he impressed me as a well-spoken person. He clearly had been successful in managing his business for 30 years and had purchased at least two real estate properties in the past. His evidence confirmed he was attempting to purchase 253 Four Mile Road in the course of these transactions.
[33] The commitment letter could easily have been amended to reflect such an alleged agreement. The fact that it was not amended or reflected in the subsequent mortgage commitments further reaffirms my view that the parties never made an agreement as alleged by Mr. Hashemi (or by Ms. Furney). It may have been discussed generally between the plaintiff and Mr. Hashemi, but I find that the plaintiff never committed to such an agreement. It is inconceivable that a mortgagee would agree to refinance properties for amounts and upon terms which had not been specified. That ultimately did occur on each of the three mortgage transactions when the respective mortgage commitments were signed.
[34] I am reinforced in that opinion by the evidence of Ms. Furney during her cross examination. She acknowledged that when Mr. Hashemi had his discussion with Mr. Kingrani, he did not know the details of the amounts due under the judgments in mid-February when he claims he reached an agreement with Kingrani to pay off the judgments.
[35] I find that the defendant Mr. Hashemi has failed to prove that the plaintiff induced him to provide the mortgage funds based on a misrepresentation or negligent misstatement of fact.
Analysis
[36] The plaintiff has testified that there was no agreement made with the defendants regarding payment of all outstanding Writs of Execution. In support of that, Mr. Virk (counsel for the plaintiff at that time) noted that the existence of the outstanding judgments was acknowledged in the commitment relating to the second mortgage transaction[^9] but no provision was inserted requiring the plaintiff to pay out the defendants’ judgments. Furthermore, in the one instance (the third mortgage transaction referenced above), the specific writ numbers to be paid out were identified on the first page of the mortgage.[^10] Funds were advanced to the defendants’ solicitor Mr. Martin and only the Joseph Abraham judgment was paid. The writ was thereafter withdrawn. The judgment in favour of LAWPRO (assigned from the Metiviers) was not paid out as promised. I am satisfied that at no time orally or in any document did Mr. Kingrani (and through him the plaintiff corporation) agree to fund the payout of the judgment in favour of Antonio Cruz in the amount of $291,000.
[37] I am further reinforced in this view by virtue of the following evidence.
[38] Ms. Furney testified that emails respecting this agreement were exchanged between various parties. Those emails are dated from February 26,2019, to and including April 3, 2019. In that respect, I have particularly reviewed her emails of February 26, 2017, March 2, 2017 and April 3, 2017. While reference is made to the judgments in the first two emails, there is no agreement that they will be paid by the plaintiff nor is there evidence of the security (and the value of the security) to be given for such an undertaking. In the email of March 2, 2017, Ms. Furney did state “we have to resolve the judgments asap” but I find this did not constitute an agreement. It constituted a concern of Ms. Furney which was never resolved. The email of April 3, 2017 alleged that Mr. Kingrani had cancelled the agreement to pay the judgments, but this was a comment made after the fact and after she had already received the funds committed under the three mortgage commitments.
[39] In her re-examination, Mr. Morris took her to an email she sent to the plaintiff on February 26, 2017, at 10:12 p.m.[^11] It is notable that Ms. Furney included the following final paragraph:
Please note that we requested your help to payout the 2nd mortgages-Refinance on 419 Progressive & 1384 York Rd to clear all the judgments.
[40] Recognizing that she needed adequate financing to “clear all the judgments”, Ms. Furney nevertheless signed mortgage commitments on February 28, 2017, (for the second transaction) and on March 9, 2017, (for the third transaction) which not only did not include a provision imposing such an obligation on the plaintiff, but also did not provide for the advance of enough funds to effect that purpose. Despite that, Ms. Furney proceeded with those transactions. In my view, this directly contradicts the argument she has put to this court. She was an experienced mortgage agent. She barely knew the plaintiff other than from her prior dealings with him from mid-February 2017.
[41] While it is not determinative of the matter, the court notes that the defendants’ lawyer Mr. Martin never filed an affidavit on this motion. He undoubtedly had the opportunity to review each of the commitments as he dealt with these matters. If there was an agreement to pay out all judgments as alleged, I would have expected that he would have been advised of that fact and taken steps, as any prudent solicitor would, to confirm that fact and protect his clients from the dilemma in which they have ultimately found themselves. On a motion for summary judgment, all parties are bound to put their best case forward for analysis by the court.
[42] I find that the parties never had a meeting of the minds that the plaintiff was to advance more funds than agreed to in the three written mortgage commitments or to pay out the Cruz judgment.
[43] The defendant argues that the “commercial reality test” dictates that the defendants would never have agreed to the second transaction, which resulted in a “blanket mortgage” against both 1384 York Road and 419 Progressive Avenue and an increase in the interest rate from 12 percent to 24 percent, unless the Cruz judgment of approximately $291,000 was to be paid off. The defendants argue that without that payment, the plaintiff had excessive security for its loan. That position was summarized in Mr. Martin’s email of April 19, 2017 at 3:25 pm to Amandeep Sidhu, counsel for the plaintiff.[^12] The defendants have not persuaded the court of the correctness of Mr. Martin’s assertion either in evidence or in their submissions. The precise details of the balance owing on existing mortgages and executions against the various properties owned by the Furney Defendant were not provided to this court.
[44] In the same email, Mr. Martin stated:
Furney would not have agreed to the blanket without the agreement to pay the execution, and your client had paid off an execution earlier in a different arrangement, so the idea of paying off the execution was familiar as a step-in financing.
[45] From the record before the court, that statement is incorrect. The only funds advanced which were earmarked for paying off judgments were those in the third mortgage transaction. The commitment for that transaction was signed approximately nine days after the second transaction involving the “blanket” mortgage transaction on Progressive Avenue and York Road.
Third Mortgage Transaction
[46] Mr. Abraham held a second mortgage for $150,000 on the defendant Ms. Furney’s property at 419 Progressive Avenue. The plaintiff agreed in the third mortgage transaction to take an assignment of that mortgage. Because the mortgage had been in default, Mr. Abraham had obtained judgment against the defendants. In order to pay out the judgment, the defendants moved before Edwards J. on March 9, 2017, to obtain an order[^13] that upon the payment of $197,145.16 into court, the Abraham mortgage was to be assigned to the plaintiff and any writs of seizure and sale obtained by Mr. Abraham with respect to his judgment on the mortgage were to then be lifted. That all occurred[^14] with $200,000 of the funds advanced by the plaintiff. The balance of the $249,000 advance was paid out to Mr. Hashemi.
[47] Mr. Morris has argued that the advances made as part of the third mortgage transaction are important evidence confirming his clients’ position. He argued that the plaintiff already held blanket security against 419 Progressive Avenue and 1384 York Road as a result of the second mortgage transaction. He submitted that the parties’ third mortgage transaction made no sense unless it was part of an agreement when the collateral security was registered on February 28, 2017.
[48] I disagree. When Mr. Kingrani made the advances to effect the second mortgage transactions, he was entitled to seek and obtain as much security for his loans as reasonably possible. He knew there were outstanding judgments against the defendants and advanced in the face of those judgments. He knew or certainly would have been able to discern that the defendant Ms. Ferney was in significant financial difficulty. In support of their argument that there was an oral agreement that the plaintiff was to pay out the Cruz judgment, the defendants have baldly alleged that there was ample equity available in the 419 Progressive Avenue and 1384 York Road properties to protect the plaintiff if he advanced $291,000. That evidence was never provided to the court. The amounts due on outstanding mortgages against those properties in March 2017 were not provided to the court. All that was provided were copies of property abstracts and relevant mortgages in Exhibit 3. Some appraisals of the properties were attached to the affidavit of the defendant Ms. Furney, but these alleged values were never related by detailed analysis to properly quantify the equity which allegedly existed in each property.
[49] When the third mortgage transaction occurred, the plaintiff took an assignment of the Abraham mortgage which was only possible by advancing sufficient funds to Ms. Furney to enable her to comply with the order of Edwards J.
[50] Mr. Morris acknowledged in his written submissions that as of March 10, 2017, the defendants required one further advance to clear the Cruz judgment in order to be able to sell or refinance 253 Four Mile Creek Road and repay the plaintiff. Knowing this, I reject the defendants’ contention that there was an oral agreement that the plaintiff would pay out the Cruz judgment. It was certainly not done between the closing of the second mortgage transaction on or about February 28, 2017, and the signing of the third mortgage commitment on March 9, 2017.[^15] When the third mortgage transaction was reduced to a written commitment, the parties arranged for the payout of two of the three judgments. The funds advanced in the third mortgage commitment were clearly insufficient to pay out all the judgments.
[51] I find that the defendants knew, or had to know, that each advance was subject to a written commitment being executed, security for the advance being established and sufficient funds being available to effect that purpose.
[52] I find this did not occur with respect to the Cruz judgment because the parties never had a meeting of the minds to make it happen
[53] For reasons not clear to this court, the defendants were unable to obtain the requisite financing to pay out the plaintiff’s mortgages and the Cruz judgment.
[54] The onus is on the defendants to establish, on the balance of probabilities, that an oral representation made by the plaintiff had the effect of inducing a course of conduct upon the defendants.[^16] As noted above, I do not find that any such representation was made. I find that the three mortgage commitments were agreements made in good faith by experienced and independently advised parties and reflected the agreements of the parties.
[55] I find on the evidence before this court, which was not disputed by the defendants or their counsel, that each of the defendants personally guaranteed payment of each of the mortgages registered in favour of the plaintiff as part of the three transactions in question.
Criminal Rate of Interest
[56] I recognize that a spectrum of remedies are available to a judge in civil proceedings when a violation of s. 347 of the Criminal Code is found.[^17]
[57] The plaintiff conceded[^18] that the calculation of interest plus the additional fees for payment, penalties, default fees, and other fees that were all included in the discharge statements that were initially provided by the plaintiff did offend the provisions of the Criminal Code.[^19]
[58] In his factum, counsel for the defendant argued that the effective interest rates on three of the loans ranged from 64 percent to a high of 166 percent. Unfortunately, the defendants did not provide actuarial evidence to verify those calculations.
[59] Counsel for the plaintiff submitted that because the penalties, default fees and other fees have not been paid or collected, they are irrelevant for the purposes of calculating the true interest rate and the plaintiff is entitled to recover the amounts actually advanced by it at the interest rate provided for in the mortgages themselves.
[60] Counsel for the plaintiff[^20] provided the court with a chart specifying the amounts purportedly advanced under each mortgage transaction.[^21] It summarized the transactions as follows:
Transaction #1: Interest Calculations at 18% per annum
Credit Advanced (CA) = $65,600
Lender + Broker + Lawyer Fees = $16,400 (25% of CA)
Principal = CA + Fees = $82,000.
When the cost of the fees (25% of the Credit Advanced) is added to the 18% interest on the CA, it amounts to a first year interest rate of 43 per cent.
Transaction #2: Interest Calculations at 24% per annum
Credit Advanced (CA) = $542,319.19
Lender + Broker + Lawyers Fees = $78,665.81 (14.5% of CA)
Principal = CA + Fees = $620,985.00
When the cost of the fees (14.5% of the Credit Advanced) is added to the 24% on the CA, it amounts to a first year interest rate of 38.5 per cent.
Transaction #3: Interest Calculations at 24% per annum
Credit Advanced (CA) = $245,913.96
Lender + Broker + Lawyer Fees = $38,161.04 (15.5% of CA)
Principal = CA + Fees = $284,075.00
When the cost of the fees (25% of the Credit Advanced) is added to the 24% interest on the CA, it amounts to a first year interest rate of 39.5 per cent.
[61] Mr. Morris, in his submissions, did not take serious issue with the accuracy of these interest calculations, though he did disagree with the actual amounts advanced and the effective rates of interest claimed in various mortgage discharge statements provided by the plaintiff.
[62] The plaintiff argues that the charges themselves, while carrying hefty interest rates of 18 percent and 24 percent, do not provide for a criminal rate of interest. In his submissions, Mr. Reininger submitted that all his client seeks is payment of interest on the actual amounts advanced at the rates stipulated in the mortgages.
[63] In determining the interest rate of each loan, I am guided by the decision of DeWolf v. Bell ExpressVu Inc., 2009 ONCA 644, 97 O.R. (3d) 1. Rouleau J.A., writing for the court, dealt with what constituted interest charges under s. 347 of the Criminal Code. At para. 39, he wrote:
[39] In my view, for the purposes of analysis, a distinction must be made between institutions whose business it is to lend money or advance credit on the one hand, and service providers like the appellants and Consumers’ Gas Co. on the other hand. Where the relationship between the parties is exclusively one of lending money, any additional charges or fees are inherently connected to the lending of money or the advancing of credit, regardless of their label. Generally speaking, such fees are likely to fall within the definition of interest in s. 347.
[64] Thus, I agree with Mr. Virk’s submission that the lender, broker and lawyer’s fees must be included as part of the calculation of interest, but only if those charges constitute an amount paid by the plaintiff in order to permit the defendants to receive credit under the mortgage commitments. I find that the effective interest rates now being claimed by the plaintiff do not result in criminal rates of interest being charged to the defendants contrary to the 60 percent limit contained in s. 347(1) and (2) of the Criminal Code.
Failure to Provide Timely and Accurate Discharge Statements
[65] Counsel for the defendants has urged the court to consider s. 22 of the Mortgages Act.[^22] It provides as follows in ss 22(2) and (3):
(2) The mortgagor may, by a notice in writing, require the mortgagee to furnish the mortgagor with a statement in writing,
(a) of the amount of the principal or interest with respect to which the mortgagor is in default; or
(b) of the nature of the default or the non-observance of the covenant,
and of the amount of any expenses necessarily incurred by the mortgagee.
(3) The mortgagee shall answer a notice given under subsection (2) within fifteen days after receiving it, and, if without reasonable excuse the mortgagee fails so to do or if the answer is incomplete or incorrect, any rights that the mortgagee may have to enforce the mortgage shall be suspended until the mortgagee has complied with subsection (2).
[66] The Court of Appeal’s recent commentary on s.22 in 1173928 Ontario Inc. v. 1463096 Ontario Inc., 2018 ONCA 669 at paras. 41-43 provides guidance on the issue of s.22 in the present case:
41 The purpose of s. 22(1) of the Mortgages Act (and also of s. 23(1), which does not figure into this decision) is to provide a mortgagor with access to relief from acceleration of the entire mortgage debt that came about because of the default. See generally Marriott and Dunn: Practice in Mortgage Remedies in Ontario, loose-leaf, 5th ed. (Toronto: Thomson Reuters, 1995), at §19.2.
42 Section 22(2) works together with s. 22(3). Where the mortgagee fails to answer a request for a mortgage statement within 15 days without reasonable excuse or answers it incompletely or incorrectly, then the mortgagee's rights to enforce the mortgage, including the exercise of a power of sale or commencement of a mortgage action, is suspended until the mortgagee provides an accurate and complete mortgage statement. But the provision is not to be used as a shelter by a mortgagor who does not desire to bring the mortgage into good standing. A mortgagor "is not entitled to suspend the mortgagee's rights for an indefinite period of time, simply by questioning the [mortgage statement]": Double D Developments Ltd. v. Green (1979), 1979 CanLII 2065 (ON SC), 24 O.R. (2d) 391 (Ont. H.C.), at para. 9. Tendering or paying into court the amount of money that the mortgagor claims is owed could evince an intention to redeem the mortgage in the face of ongoing accounting disputes: Double D Developments Ltd., at para. 8. [emphasis added].
[67] The defendants have done nothing to attempt to tender or pay into court the amounts they claim are owing. They have paid absolutely nothing on the mortgages for over three and one-half years. They have failed to avail themselves of the legislated court remedies available to them under the Mortgages Act.[^23]
[68] I find on the evidence before this court that the plaintiff was seriously deficient in providing accurate and legal enforceable discharge statements to the defendants. Mr. Hashemi alleged in his affidavit[^24] at paragraph 30, that the plaintiff had demanded $146,000 from him to obtain a discharge of mortgage (presumably with respect to the $82,000 mortgage against his property at 428 Dundas Street, Woodstock.) Unfortunately, that document was not attached as Exhibit C to his affidavit as stated. That statement was not contested by the plaintiff in its materials. If it is the correct amount demanded, it clearly constituted an illegal rate of interest being claimed by the plaintiff.
[69] In the affidavit of Ms. Furney, she refers to a number of discharge statements sent by the plaintiff to the defendants. On May 8, 2017 the plaintiff sent mortgage discharge statements relating to each of the three aforesaid mortgage transactions.[^25] In each of these, there are significant sums claimed under s. 17 of the Mortgages Act. Section 17 is a legislative enactment to compensate the mortgagee in an amount equivalent three months interest in recognition of the time needed to re-invest the principal in the event of the mortgagor wishing to repay the loan prior to the maturity date of the mortgage.[^26] It does not specifically provide the mortgagee, at the date of maturity, with the right to claim an additional three months interest as a condition of obtaining a discharge of a mortgage which is not in default. Our courts have held that if a mortgage reaches maturity and the mortgage is not paid out in accordance with a proper discharge statement provided by the mortgagee, the mortgagee may legally claim three months interest in addition to the other sums due under the mortgage.[^27] There is another line of subsequent authorities from this court which do not agree with that proposition[^28] but I need not attempt reconcile that in this case.
[70] In the cases at bar, all the mortgages became due and were not paid on the stipulated date of repayment. However, at that time, the plaintiff was seeking payments which constituted illegal rates of interest. Consequently, the plaintiff had no right at that time to payment of the bonus payment of three months interest. Counsel has since abandoned any claim to such payments.
[71] In early July 2017, the plaintiff again sent mortgage discharge statements to the defendants with the amount allegedly due as of July 7, 2017.[^29] They all included interest and charges which the parties now agree exceeded the lawful interest rate.
[72] On July 17, 2017, the defendants’ former lawyer Maurice Neirinck wrote a letter to the plaintiff’s lawyer, Mr. Sidhu, in which he clearly articulated the fact that the interest rates being claimed on each of the mortgages were unlawful and exceeded sixty percent per annum.[^30] He demanded the plaintiff provide revised payout statements in accordance with the concerns raised in his letter. He warned that if this was not done, he would be serving an application record for appropriate relief at the beginning of the next week. For reasons not provided to the court, this never occurred. The record does not indicate if there was any response from the plaintiff or its counsel.
[73] The statement of claim in each of these actions was issued in October 2017.[^31] The amounts claimed in October 2017 (approximately 8 months after the funds were advanced in each transaction) were detailed at para. 8 of each claim and again claimed amounts in excess of the legal interest rate.
[74] In December 2017, the plaintiff provided further erroneous, overstated mortgage discharge statements containing the same charges under section 17 of the Mortgages Act.[^32]
[75] It is evident in the records before the court that in February, May and June of 2018, the defendants continued to request proper payout statements.[^33] In March 2018, the plaintiff again provided discharge statements with excessive amounts claimed.[^34]
[76] The lawyer representing the plaintiff with respect to the delivery of mortgage calculations was, up to mid-April 2019, Amandeep Sidhu. A Notice of Change of Solicitors was then served on the defendants appointing Mr. Virk as counsel for the plaintiff.
[77] On April 30, 2019, Mr. Virk sent a lengthy email to the defendants.[^35] In it, he attached three mortgage statements indicating the amounts the plaintiff was claiming due on each of the mortgages. On the first page of the letter, he wrote:
To mitigate litigation costs and avoid listing of sale of your properties, kindly pay the principal amount plus interest to date (for all the mortgages) as per your calculation in the court or in our trust account on or before May 6, 2019. The disputed amount of interest and penalties will be subject to the accounting and can be decided by the court later on.
[78] This was never done by the defendants.
[79] The first evidence in the records before the court of the plaintiff indicating that it would accept a reduced payout on the mortgages which would not constitute a criminal rate of interest was contained in Mr. Virk’s email/letter dated June 12, 2019[^36] to Ms. Furney and Mr. Frank Manzo (the mortgage broker for whom Ms. Furney and Mr. Muthu both worked), with a copy to Mr. Hashemi. In that email, he stated the position of the plaintiff with respect to the allegations of a criminal rate of interest. At p. 143, para. 8 of his letter, Mr. Virk noted that as soon as he had been advised that the mortgages exceeded the legal interest rates, (the commitments for which were drawn or reviewed by a mortgage broker, Mr. Muthu, signed by a mortgage broker, Ms. Furney, and reviewed by the defendants’ lawyer, Mr. Martin), Mr. Kingrani had simply requested that the defendants pay the stipulated interest rates contained in the mortgages (24 percent and 18 percent). Those earlier offers to resolve the matters on the terms allegedly suggested by Mr. Kingrani are not in the records before this court.
[80] To date, the defendants have paid nothing on the amounts due under the mortgages nor offered to do so. Nevertheless, our courts have recognized the right of a mortgagor to proceed with a counterclaim for damages in the event that they were in a position to repay the mortgage but for the overstated discharge statement.[^37] The defendants shall be permitted to proceed with their counterclaim in light of the plaintiff’s failure to provide timely and accurate mortgage statements. The issue of their failure to mitigate those alleged damages by applying to the court under the Mortgages Act will very probably be also considered by the court hearing that matter.
Effect of the Claim for an Illegal Rate of Interest on the Rights of the Parties:
[81] In their reply materials, the plaintiff placed great emphasis on Milani v. Banks (1997), 1997 CanLII 1765 (ON CA), 32 O.R. (3d) 557 (C.A.) and Transport North American Express Inc. v. New Solutions Financial Corp.
[82] These cases are the governing authorities on notional severance and s. 347 of the Criminal Code. As stated by the Supreme Court in Transport North American Express Inc. at para. 6, the court has a spectrum of options available to deal with contracts in violation of the criminal rate of interest. This spectrum ranges from finding the provisions so objectionable that the entire contract is tainted to situations where, despite their contravention, the contract is otherwise unobjectionable. The latter case will often attract severance. Determination of where on the spectrum a provision rests, and the appropriate remedy, requires careful analysis of the contractual context and the illegality involved. At paras. 41-46 the Court provides four factors to consider when determining whether public policy ought to allow an otherwise illegal agreement to be enforced:
(i) Whether the purpose or policy of s. 347 would be subverted by severance;
(ii) Whether the parties entered into the agreement for an illegal purpose or with an evil intention;
(iii) The relative bargaining positions of the parties and their conduct in reaching the agreement; and
(iv) The potential for the debtor to enjoy an unjustified windfall.
[83] I do not find that the purpose of s. 347 of the Criminal Code would be subverted by notional severance. It has not escaped the court’s notice that not one cent has been paid on any these mortgages since the funds were advanced over three years ago. All parties signed a commitment with respect to each transaction, knowing full well that these were short-term, high-risk loans. Ms. Furney was a registered mortgage agent. She and her defendants even signed a mortgage commitment dated February 17, 2017 acknowledging the terms of the charge were “above legal limits.”[^38] All understood that Ms. Furney and Mr. Furney were in dire financial straits, as evidenced by the various judgments outstanding against them and the arrears on a mortgage registered against her property at 1728 York Road. They needed short term financing and were prepared to pay extremely high interest and related costs to extricate themselves from their dilemma. Mr. Kingrani recognized her predicament and the risks associated with lending to her. The parties did not enter these agreements for an illegal purpose. The aim was clear: to try to allow the Furneys a way out from under their difficult financial situation. Mr. Hashemi was motivated by the hope of being able to purchase 253 Four Mile Creek Road. The parties were in relatively equal bargaining positions and were all represented by counsel. While the interest rates on the mortgages at 24 percent and 18 percent were high, they were not illegal, nor are they illegal at the time of this judgment. The defendants (debtors) did not have the potential of enjoying an unjustified windfall in these transactions but they certainly would if severance is not granted.
[84] Mr. Morris, in his able submissions on behalf of the defendants,[^39] urged the court to reduce the interest payable to the rates provided under the Courts of Justice Act[^40] and fix the amounts owing under the mortgages (not the face amount of the mortgages) at the prescribed rates for the first quarter of 2017, being 0.8 percent.
[85] In support of that submission, he relied on the case of Cheung v. Moskowitz Capital Mortgage, 2018 ONSC 1322, 87 R.P.R. (5th) 89. In that case, the mortgagors convinced the court that the mortgagee had manipulated the mortgage by attempting to create an artificial renewal. The mortgagor argued that the mortgagee should not profit from the higher interest rate under the mortgage from the date of its maturity to the date of the court order. Morgan J. agreed, stating at para. 22 that the mortgagee should not be permitted to profit from its wrongful conduct. He ordered that the interest on the mortgage from the date of maturity to the date of payout should be at the Courts of Justice prescribed rate noting at para. 23 that such a decision would require the mortgagors to pay something for the time value of the money they had enjoyed and the mortgagee would not reap a profit from its delay in providing a proper discharge statement.
[86] In my view, this case is distinguishable on its facts. In Cheung, the mortgagors brought a timely application to the court. The defendants have not availed themselves of possible remedies under the Mortgages Act. They have not tendered payment of the sums they considered payable. They have continued to enjoy the use of the plaintiff’s money, during a period of time (which I take judicial notice of) that real estate prices in southern Ontario, including Niagara-on-the-Lake, have been escalating considerably. I do not accept on the evidence I have considered that the plaintiff was attempting to reap a profit from its failure to provide proper discharge statements.
[87] This was a risky commercial transaction. The parties bargained for the interest rates reflected in the registered mortgages. Severance, when adjudged to be appropriate, should only be used to bring the agreement within legal boundaries with the minimal possible alteration of the parties’ bargain, absent intentional misconduct on the part of the mortgagee.
[88] I find that the severance of each of the mortgages to allow the plaintiff judgment for only the principal sum of the mortgage funds advanced plus interest thereon at the rates agreed to by the parties is an appropriate remedy in this case. Mr. Reininger, in his written reply submissions, agreed with such a disposition and that the lender’s fee paid in any transaction to his client should not form part of the principal and interest payable in these matters. I concur because the lender never advanced its funds with respect to such claims.
Calculation of the Amounts Owing Under Each Judgment:
[89] The defendants dispute the correct amount of money advanced in each mortgage transaction and the amount upon which interest would therefore be charged.[^41]
The Second Mortgage Transaction:
[90] With respect to the second mortgage transaction,[^42] the defendants allege that only $547,000 was advanced and not $620,000 as claimed originally by the plaintiffs. The accounting documents from the file of the plaintiff’s solicitor Ranjeet Walia[^43] indicate that after payment of his legal fees of $2829.61, the sum of $532,319.19 was forwarded by certified cheque to the defendants’ lawyer David Martin in trust. A further sum of $10,000 was advanced by the plaintiff by certified cheque to David Martin in trust on February 28, 2017.[^44] I concur with Mr. Morris’ submission that only $547,000 was advanced with respect to this transaction based on the evidence before this court.
[91] Mr. Reininger, in his responding submissions, submitted that the commitment for that transaction provided that the lender’s fee was to be $10,000.00. However, that is not what the document states.[^45] It states “lender/broker fees 12%”. Elsewhere in the jungle of materials before the court, there is a copy of an email dated February 26, 2017 (just before this transaction closed) from Ms. Furney to Mr. Kingrani and Mr. Hashemi specifying the lender’s fees will be 10 percent and the broker’s fees will be 2 percent.[^46] That appears to confirm the agreement in the signed commitment.
[92] The mortgage amount in para. 1 of the commitment was for $610,486.65 with another unidentified $10,000 figure written in as an increase in that amount to $620,486.65. That was reflected in the amendment to the mortgage registered by Mr. Walia.[^47] The plaintiff in his written submissions agreed that the $10,000 paid to the plaintiff as a lender’s fee should be severed or deducted, resulting in a principal amount owing of $600,486.65. I agree with the principle but not the amount. As I review that mortgage commitment, I do not see that there is a stipulation that a $10,000 lender’s fee is to be paid. The broker’s fee, which was paid and should be added to the principal amount claimed under the mortgage, was calculated by the parties was to be 1/6 of $64,337.85 or $10,722.98. I also find on the evidence before the court that the brokerage fee was not paid to the plaintiff.
[93] I find therefore that the principle amount advanced under this mortgage and for which judgment shall be rendered is $557,722.98. That is calculated as follows:
$547,000 + $10,722.98 = $557,722.98
The First Mortgage Transaction:
[94] With respect to the first mortgage transaction,[^48] the defendants argue that only $67,000 was actually advanced at 18 percent interest for a 90-day term. The plaintiff argues that $73,000 was actually advanced made up of $67,000 principal plus $6,000 paid by it on closing to the mortgage brokers involved as per the signed commitments. Again, Mr. Reininger agreed that the lender’s fee credited to the plaintiff of $8,200 should not be included in the amount of the principal awarded in any judgment. I concur and judgment shall issue for the sum of $73,000 plus interest at the rate stipulated in the mortgage.
The Third Mortgage Transaction:
[95] The third mortgage transaction[^49] is referred to in the defendants’ factum at para. 91. In fact, that commitment was increased from an initial amount of $$239,800 to $249,920 [^50] and those changes were initialed by the defendants. The same Motion Record shows that $249,920 was received from the plaintiff in its lawyer’s trust account and after legal fees of $4006.04 were deducted, the balance of $245,913.96 was paid to David Martin in trust (counsel for the defendants in that transaction).[^51] In the circumstances, judgment shall issue for the sum of $249,920 plus interest at the rate stipulated in the mortgage.
The Counterclaims:
[96] The defendants’ counsel has indicated in his letter to the court dated August 12, 2020 that his clients intend to pursue their counterclaims in each action. I have no evidence of damages suffered by them as a direct result of being presented with the overstated mortgage statements. Furthermore, the defendants’ pleadings in the counterclaims in each trial record are sadly deficient of particulars and leave to amend undoubtedly will have to be sought.
[97] In light of the foregoing, and in light of the fact that the plaintiff’s motion records do not seek a dismissal of the counterclaims, I will not adjudicate on the issues arising from the discharge statements. That will be the responsibility of another court in the event that the defendants decide to pursue the counterclaim(s). I must say that I do wonder why the defendants did not mitigate their alleged damages by applying to court at an early date to permit payment into court of some or all of the disputed amounts. This in turn would have allowed them to obtain the required discharges to effect the refinancing arrangements purportedly available to them.
Conclusion
[98] I am satisfied on the entirety of the record before this court that there is not a genuine issue which requires a trial of the “main actions”, being the plaintiff’s claims in each action. The funds were advanced. There is no question the mortgages are in default. While the interest rates on the mortgages are high, the plaintiff is entitled to be paid that rate over the term of the default of the mortgages as provided in their provisions.
[99] The plaintiff is entitled to judgment on its claim in each of the actions before the court as specified below in paras. 99, 100, and 101.
[100] Actions CV 17-63374 and CV 17-63377
This court orders and adjudges that the defendants Maryam Furney, Hassan Hashemi and Alex Aiden Fitzgerald Furney shall jointly or severally pay to the plaintiff the sum of $249,920 plus interest at the rate of 24 percent per annum from March 10, 2017 until the date of payment of this judgment.
This court orders and adjudges that the defendant Maryam Furney shall deliver to the plaintiff possession of the following lands and premises:
a. Municipal Address: 419 Progressive Ave. East, Niagara-On-The-Lake, Ontario
b. Property Identification Number: 46376-0068
c. Legal Description: PT TWP LT 41 NIAGARA AS IN
R0809175; S/T RO136774
NIAGARA-ON-THE-LAKE, Land Registry Office #30.
- This court orders and adjudges that the defendant Hassan Hashemi shall deliver to the plaintiff possession of the following lands and premises:
a. Municipal Address: 428 Dundas Street, Woodstock, Ontario
b. Property Identification Number: 00104-0129 (LT)
c. Legal Description: PT LT 3 S/S DUNDAS ST PL AS IN 453408
Land Registry Office #41.
[101] Action 17-63375 SR
This court orders and adjudges that the defendants Maryam Furney, Hassan Hashemi and Alex Aiden Fitzgerald Furney shall jointly and severally pay to the plaintiff the sum of $73,000 plus interest at the rate of 18 percent per annum from February 17, 2017 until the date of payment of this judgment.
This court orders and adjudges that the defendant Hassan Hashemi shall deliver to the plaintiff possession of the following lands and premises:
a. Municipal Address: 428 Dundas Street, Woodstock, Ontario
b. Property Identification Number: 00104-0129 (LT)
c. Legal Description: PT LT 3 S/S DUNDAS ST PL AS IN 453408
Land Registry Office #41.
[102] Action: 17-63376
This court orders and adjudges that the defendants Maryam Furney, Hassan Hashemi and Alex Aiden Fitzgerald Furney shall jointly and severally pay to the plaintiff the sum of $557,722.98 plus interest at the rate of 24 percent per annum from February 28, 2017, until the date of payment of this judgment.
This court orders and adjudges that the defendants Maryam Furney and Alex Aiden Fitzgerald Furney shall deliver to the plaintiff possession of the following lands and premises:
a) i. Municipal address: 1384 York Road
Niagara-On-The-Lake, Ontario
ii. Property Identification
Number: 46372-0207 (LT)
iii. Legal Description: PT TWP LT 89 NIAGARA AS IN
R0207389; NIAGARA-ON-THE-LAKE;
Land Registry Office #30
b) i. Municipal address: 253 Four Mile Creek Road
Niagara-On-The-Lake, Ontario
ii. Property Identification
Number: 46373-0003 (LT)
iii. Legal Description: PT TWP LT 90 NIAGARA AS IN
R0657155; NIAGARA-ON-THE-LAKE;
Land Registry Office #30
Costs
[103] If counsel cannot agree on reasonable costs and disbursements, I will receive written submissions from counsel in accordance with the following schedule. The plaintiff shall serve and file its written submissions of no more than six pages, double-spaced together with a costs summary including dockets on or before October 26, 2020. The defendant shall serve and file its reply materials of no more than six pages, double-spaced on or before November 9, 2020. The plaintiff may serve and file brief reply materials of no more than three pages on or before November 16, 2020.
Turnbull, J.
Released: October 14, 2020
COURT FILES NO.: CV-17-63377, 17-63374, CV 17-63375 SR, CV-17-63376
DATE: 2020/10/14
2257573 Ontario Inc.
Howard W. Reininger, for the Plaintiff/Defendant by Counterclaim/Moving Party
Plaintiff/Defendant by Counterclaim/
Moving Party
- and -
Alex Aiden Fitzgerald Furney also known as Alex Furney, Maryam Furney and Hassan Hashemi
Defendants/Plaintiffs by Counterclaim
Responding Parties
Trent Morris for the defendants, plaintiffs by counterclaim.
Released: October 14, 2020.
[^1]: Exhibit A to the affidavit of Anil Kingrani, Plaintiff’s Motion Record, page 20. [^2]: Motion Record at page 21, exhibit A to affidavit of Anil Kingrani. [^3]: 2020 ONSC 6451. [^4]: This is one of the processes recommended by the Supreme Court of Canada in Hyniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87 to determine if there is a genuine issue requiring a trial. [^5]: The parties have referred to this mortgage agent as Mr. Muthu for ease of reference. His actual name is Muthu Kumara Samy Thulasitharan. He has sworn an affidavit dated July 13, 2019 and which is annexed as Exhibit A to the Affidavit of Anil Kingrani sworn October 22, 2019. [^6]: Exhibit 3, Tab 20. [^7]: Motion Record in Action 17-63375, Affidavit of Anil Kingrani sworn July 11, 2017 at Exhibit S at p. 161. [^8]: Motion Record in Action #17-63375, Affidavit of Anil Kingrani sworn July 11, 2019, Tab 22, p. 162. [^9]: Action CV17-63376. Motion Record, Exhibit A to the Affidavit of Anil Kingrani, at p. 20. [^10]: Action CV17-63374 and Action CV17-63377. Motion Record at p. 24, Exhibit B to the Affidavit of Anil Kingrani. [^11]: Motion Record in File 17-63375 SR, Tab 22, at p. 163. [^12]: Responding Motion Record of the Defendants, Action CV17-63374 and Action CV17-63377, Affidavit of Maryam Furney sworn October 8, 2017, Exhibit M, at p. 137. [^13]: Exhibit 3, Tab 18. [^14]: Exhibit 3, Tab 17. [^15]: Motion Record # CV-17-63377. [^16]: Scotsburn Co-Op Services Ltd. v. W.T. Goodwin Ltd., 1985 CanLII 57 (SCC), [1985] 1 S.C.R. 54, at p. 65. [^17]: Transport North American Express Inc. v. New Solutions Financial Corp., 2004 SCC 7, [2004] 1 S.C.R. 249. [^18]: Concession was made by Mr. Virk, the plaintiff’s original counsel on this motion. [^19]: R.S.C. 1985, c. C-46. [^20]: This chart was prepared and presented by prior counsel for the plaintiff, Mr, Virk. [^21]: These are the principal amounts originally claimed by counsel for the plaintiff, which were varied later in submissions as reflected in the latter part of this judgment. [^22]: R.S.O. 1990, c. M.40 [^23]: R.S.O. 1990, C.M 40. [^24]: Motion Record in Action #17-63375, Affidavit of Hassam Hashemi, Tab 2, page 230. [^25]: Motion Record in Action #17-63375, Affidavit of Maryam Furney, Tab N, Exhibit N, pp. 140-143. [^26]: Mastercraft Properties Ltd. v EL EF Investments Inc. (1993), 1993 CanLII 8545 (ON CA), 14 O.R. (3d) 519 (C.A.), 103 D.L.R. (4th) 759, at p.766. [^27]: Ialongo v Serm Investments Limited (2007), 2007 CanLII 6242 (ON SC), 54 R.P.R. (4th) 310 (ONSC) at para. 24, citing with approval Gullett v. Income Trust Co. (1985), 11 O.A.C. 178. [^28]: Lee v He, 2018 ONSC 5932, 2 R.P.R. (6th) 154, at para. 30, citing 2468390 Ontario Inc. v. 5F Investment Group, 2017 ONSC 4641, 140 O.R. (3d) 233. [^29]: Motion Record in Action #17-63375, Affidavit of Hassam Hashemi, Tab 2, Exhibit C, pp. 238-240. [^30]: Motion Record in Action #17-63376, Affidavit of Maryam Furney, Tab 1Q, p. 155-156. [^31]: Motion Record in Action #17-63377 and 63374, Tab 7. Motion Record in Action #17-63375, Tab 8. Motion Record in Action #17-63376, Tab 7 [^32]: Motion Record in Action #17-63375, Affidavit of Maryam Furney, Tab 1S, Exhibit S, p. 165. I note that at para. 51 of her affidavit, Ms. Furney says that copies of the mortgage statements are attached but in the record provided to the court, there is only one statement. It is the same in all the motion records. [^33]: Motion Record in Action #17-63375, Affidavit of Maryam Furney, Tab 1T, Exhibit T, pp. 167 to 179. [^34]: Motion Record in Action #17-63375, Affidavit of Maryam Furney, Tab 1U, Exhibit U, pp. 181-184. [^35]: Motion Record in Action #17-63375, Affidavit of Anil Kingrani, Tab 13, Exhibit J, p. 62. [^36]: Motion Record in Action # 17-63375, Affidavit of Anil Kingrani, Tab 22, Exhibit S, at pp. 139, 141 et seq. [^37]: Lee v. He (2018), 2018 ONSC 5932, 2 R.P.R. (6th) 154 at paras. 76-82. [^38]: Motion Record in Action #CV 63375, Affidavit of Anil Kingrani, tab 3, page 22. [^39]: Letter addressed to the Court dated August 12, 2020 [^40]: R.S.O. 1990, c. C.43 [^41]: Defendants’ Factum in Actions CV 63377 and CV 63374 at para. 101. [^42]: Action # CV 63376: mortgage for $620,000 against 1384 York Road and 419 Progressive Avenue. This is the transaction in which the first and second mortgages held by Elle and Subprime against 253 Four Mile Creek Road were assigned to the plaintiff. [^43]: Action # CV 63376: Motion Record, Affidavit of Anil Kingrani, exhibit D, tab 6, pages 34 and 35. [^44]: Action # CV 63376, Tab 6, p. 36. [^45]: Action # CV 63376, Motion Record, Tab 3, p. 20. [^46]: Action # CV 63375: Motion Record, Affidavit of Anil Kingrani, Exhibit D-2, p. 36. [^47]: Action # CV 63376, Motion Record, Tab 5, pp. 30-31. [^48]: Action # CV 63375: Third mortgage for $82,000 on 253 Four Mile Creek Road, Niagara on the Lake and collateral mortgage against 428 Dundas Street, Woodstock. [^49]: Actions CV 63377 and CV63374: Mortgage against 419 Progressive Avenue, Niagara on the Lake with a collateral third mortgage for $105,000 against the defendant Hashemi’s property at 428 Dundas Street, Woodstock. [^50]: Motion Record in Action CV 63377 and CV63374 at p. 23. [^51]: Motion Record in Action CV 63377 and CV 63374 at Tab 6, page 31.