COURT FILE NO.: CV-18-00604341-0000
DATE: 20200205
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
TERRY LEBLANC
Plaintiff
– and –
HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO
Defendant
Andrew Ostrom, Counsel for the Plaintiff
Eunice Machado, Counsel for the Defendant
HEARD: JANUARY 24, 2020
G. DOW, J.
REASONS FOR DECISION
[1] Each party seeks summary judgment. The plaintiff requested that he be awarded $264,883.04 in damages plus interest and costs. Her Majesty the Queen in Right of Ontario (“HMQ”) sought dismissal of the action with costs.
Background
[2] Mr. LeBlanc attended at the Parry Sound Courthouse on April 12, 2018 to participate in an auction of the property known municipally as 376 Crescent Road, Sundridge. That property was the subject of a Writ of Seizure and Sale following a judgment obtained by the Royal Bank of Canada for approximately $75,000.00 against its owner, Ms. Tonelli. The property was apparently worth about $520,000.00. The Royal Bank of Canada requested the Sheriff enforce the Writ which precipitated the property being listed for auction with notice to Ms. Tonelli. That Notice of Sheriff’s Sale of Land contained the terms for the sale which included “Other conditions as announced” and that the sale was “subject to cancellation by the Sheriff without further notice up to the time of the satisfaction of the sale terms by a successful bidder”.
[3] The availability of the property was also advertised in the Ontario Gazette which reported as a term “Other conditions as announced” but that the sale was subject to “cancellation by the Sheriff without further notice up to the time of sale”. This was how Mr. LeBlanc learned of the availability of the property. The Notice of Sheriff’s Sale of Lands was provided to the auctioneer. Mr. LeBlanc admitted the auctioneer “announced the rules by which the auction would be governed” but deposed same as consistent with what he had reviewed in the Ontario Gazette. The Notice of Sheriff’s Sale of Lands was also posted on the bulletin board at the Courthouse before the auction and not removed until after the auction.
[4] At the auction Mr. LeBlanc bid $260,000.00 and the auctioneer accepted that bid. Mr. LeBlanc tendered the requisite 10% deposit of $26,000.00 on that day and was given a receipt.
[5] On the day following the auction, Mr. LeBlanc was advised in a telephone message from a lawyer retained to provide the Sheriff with legal advice and services that the Sheriff was not going to proceed with the sale. The deposit would be returned (and was) and no Agreement of Purchase and Sale would be forwarded.
[6] It was acknowledged Mr. LeBlanc attended the Sheriff’s office to tender the remaining funds on April 25, 2018 in accordance with the terms contained in the Notice of Sheriff’s Sale of Land and the Ontario Gazette. The funds were not accepted.
[7] The reason for cancelling the sale was a calculation the property had a value of about $520,000.00 and an internal policy of the Sheriff’s office not to sell for less than 60% of debtor equity or, in this case $312,000.00.
[8] In the interim, Ms. Tonelli apparently made satisfactory arrangements with the Royal Bank of Canada and the Bank withdrew its Direction to Enforce Writ by letter dated May 9, 2018.
Analysis
[9] The plaintiff’s position is that the phrase “time of sale” applies as well as basic contract principles. The plaintiff and the Sheriff made a contract that was entered into on April 12, 2018 and for which consideration was paid. The damages claimed from the breach are the difference between the purchase price and the market value (less $11,705.95 of outstanding taxes).
[10] The leading authority of Zingone v. Zingone (1986), 1986 2780 (ON SC), 53 O.R. (2d) 411 (S.C.O.) dealt with the issues in a slightly different manner. In that case, after the sale by auction, the purchaser signed an Agreement of Purchase and Sale. That did not occur in this matter and weakens the plaintiff’s position.
[11] In Zingone v. Zingone, supra, an ex parte order was obtained in the Superior Court before the “completion of the transaction” with leave to appeal sought and without further details. The writ of execution was satisfied before the hearing of the motion. An application was brought by the Sheriff seeking the Court’s direction unlike the Statement of Claim issued by Mr. Leblanc in this matter. I am not prepared to determine this matter in favour of the plaintiff on the basis the Sheriff did not bring such an application. Given the decision and reasons in Zingone v. Zingone, supra, there was a basis for the Sheriff to act as it did.
[12] I should also note that the decision stated the “Sheriff regards 60 to 65 percent of the equity value as a reasonable price as he cannot give possession, guarantee title nor give an inspection of the inside” (at paragraph 6). Thus, I am not prepared to determine the matter on the basis the plaintiff is entitled to damages because he claims he was not advised of this position.
[13] The application of the Rules was also considered. The current Rules were relatively new in 1985 when the circumstances in Zingone v. Zingone, supra arose. Rule 60.07 appears to have undergone have some revisions since that time. Rule 60.07(13.4) includes a writ may be withdrawn “at any time during its enforcement”. Plaintiff’s counsel accurately submitted, by inclusion of the phrase “under subrule 13.3”, this statement can be restricted to those circumstances which do not apply to the factual matrix before me. However, it does speak to the intent of the law to provide the property owner with every opportunity to satisfy a creditor and extricate herself or himself from the sale of their property by the Sheriff.
[14] At the heart of this matter is whether the inaccurate statement in the Ontario Gazette notice should permit the plaintiff to recover. I have concluded that it should not for the following additional reasons.
[15] First, the Sheriff (not actually a person) but a position in the Province of Ontario, is an office empowered by statute and regulation to exercise enforcement proceedings. The Sheriff is an officer of the court. This was stated in Zingone v. Zingone, supra.
[16] That decision also accepted the statement of the Nova Scotia Court of Appeal in Reyes v. Saranic (1978), 1978 2124 (NS CA), 29 N.S.R. (2d) 599 (C.A.) that the sale must be conducted to attract “the best price for the lands”. That did not occur here. While it may have been preferable for the minimum acceptable price to be included in the information disseminated to the public, there may be good reason why it was not.
[17] As an officer of the court, the defendant submits the Sheriff is immune from liability under Section 142 of the Courts of Justice Act, R.S.O. 1990 c. C.43 for acts “done in good faith”. Mr. LeBlanc submits the failure to utilize Rules 60.07(21) and (23) to adjourn or abort the sale in the face of Mr. LeBlanc’s offer at less than 60% of the equity value constitutes an action beyond or not good faith behaviour. Further, that rule does not grant authority to cancel a sale once entered into. As a result, Section 142 does not apply.
[18] However, the sale was only completed if the version of the terms set out in the Ontario Gazette is applied which differs from the Notice of Sheriff’s Sale of Land form prepared and provided to the auctioneer and posted on the courthouse bulletin board. In accordance with the terms contained in that document, the reconsideration by the representative of the Sheriff’s office after the auction to not proceed with the sale was within its authority and, I would conclude, acting in good faith. Further, the terms set out in the Ontario Gazette also stated “Other conditions as announced”.
[19] It would have been preferable to have evidence from the auctioneer himself that his reading of the rules of the auction were word for word from the Notice of Sheriff’s Sale of Lands he received and included the sale was “subject to cancellation by the Sheriff without further notice up to the time of satisfaction of the sale terms”. Mr. LeBlanc acknowledged the auctioneer “announced the rules by which the auction would be governed”. His impression it was consistent with the notice he had seen earlier does not directly contradict what I find occurred. I do so because the only evidence of what rules the auctioneer had to read were those contained in the Notice of Sheriff’s Sale of Lands which gave the Sheriff the right to cancel the sale when it did.
[20] In addition, I am prepared to find the posting of the accurate Notice at the Courthouse was an important additional step of “Other conditions as announced” which assists in concluding the plaintiff cannot succeed.
[21] Finally, as stated in in Zingone v. Zingone, supra, (at paragraph 19) the Superior Court is a court of equity and has jurisdiction to make this type of decision.
[22] The plaintiff’s action is dismissed. The parties sensibly agreed on costs in the all inclusive amount of $7,500.00. In addition, I was advised one party had served an Offer to Settle which, depending on the result, would alter the costs payable to $9,000.00, inclusive of fees, HST and disbursements. I agreed not to be advised of any further details of that Offer to Settle but to detail same in my reasons so the formal order can reflect that disposition, if required. I commend both parties for their collaborative approach to the issue of costs and for their efforts to have this matter determined in a timely and cost efficient manner.
Mr. Justice G. Dow
Released: February 5, 2020
COURT FILE NO.: CV-18-00604341-0000
DATE: 20200205
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
TERRY LEBLANC
Plaintiff
– and –
HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO
Defendant
REASONS FOR DECISION
Mr. Justice G. Dow
Released: February 5, 2020