COURT FILE NO.: CV-18-00001310-0000; CV-19-00003118-0000; CV-19-00003248-0000; CV-23-00002454-0000 DATE: 2024 07 22

SUPERIOR COURT OF JUSTICE – ONTARIO 7755 Hurontario Street, Brampton ON L6W 4T6

RE: SAPUSAK Chris Jamie, Plaintiff AND: 9706151 CANADA LTD., Defendant (97061) 11037315 CANADA INC., Defendant (11037) D’MELLO, Roy, Defendant (D’Mello) ALICE D’MELLO, Defendant ANNAGELDI DURDYEV, Defendant (Durdyev) ERIC SALDANA, Defendant (Saldana) DAVINDER SINGH, Defendant (Singh) AMRITPAL SINGH KULLAR, Defendant (Kullar) 1152729 B.C. LTD., Defendant (11527) BANGIA PROPERTY SERVICES LTD., Defendant (Bangia) APEX FINANCIAL CORP., Defendant (Apex) 1824231 ONTARIO INC., Defendant (18242) KASSIEDASS, Parduman, Defendant (Kassiedass) CANGUARD GROUP LIMITED, Defendant (Canguard) KAUR, Harcharan, Defendant (Kaur) FIRST NATIONAL HOLDING GROUP, Defendants (First National) HIPSZ, Thomas, Defendant (Hipsz)

BEFORE: RSJ L. Ricchetti

COUNSEL: COLVILLE-REEVES, N., Counsel for the Plaintiff, Chris Jamie Sapusak Email: nreeves@reevesricharz.com D’MELLO, R. – Self-Represented, Defendant Email: roy_dmello@hotmail.com RANDHAWA, K., Counsel for the Defendant , 11039342 Canada Inc. Email: kp.randhawa@me.com CADOGAN, G., Counsel for D efendant, Canguard Group Limited Email: gcadogan@gnclaw.ca FARLEY, A., Counsel for Defendant, Harcharan Kaur Email: afarley@grllp.com HIPSZ, T., Agent for Defendant, First National Holding Group E mail: thomashipsz@gmail.com

HEARD: May 6, 2024 , by Videoconference

REASONS FOR JUDGEMENT

The Summary Judgment Motions and Overview .. 4 The Law .. 8 Summary Judgment Motions . 8 Is a Partial Summary Judgment appropriate in this case? . 12 The Fraudulent Conveyances Act 18 Preliminary Matters . 21 Amendment of the Statement of Claim .. 21 Motion to Remove Mr. Colville-Reeves (Plaintiff’s Counsel) 21 Declaration that the Notice of Sale dated November 2017 for the Bradford Property was valid 22 The Richarz Affidavit 23 Late Filed Affidavits from the Plaintiff 25 Adjournment for Cross-examination .. 26 11039 Amendment 28 What is Not Before the Court? . 28 The Bradford Property . 29 The Defences . 30 Evidence and Analysis . 31 Conclusion on First National’s Ownership . 61 Conclusion on 11039’s Mortgage . 62 The Caledon Property . 63 The Defences . 64 Current Ownership of the Caledon Property . 64 Evidence and Analysis . 65 Conclusion on Canguard’s Mortgage . 70 Conclusion . 72 Costs . 73

The Summary Judgment Motions and Overview

[1] There were two motions by the Plaintiff before me for summary judgment:

a) one relating to the Bradford Property described below, and

b) one relating to the Caledon Property described below.

[2] All the above referenced actions have been ordered to be heard and tried together.

[3] The dispute is over the two properties (the Bradford Property and the Caledon Property) both previously owned by the Plaintiff and sold under power of sale by Mr. D’Mello, through his companies. The dispute has spawned the above proceedings:

a) CV-18-1310 (The first action where the Plaintiff challenged the validity of the first power of sale of the Bradford and Caledon Properties).

b) CV-19-3118 (The second action where the Plaintiff challenged the validity of the second power of sale of the Bradford Property).

c) CV-19-3248 (An action against Harcharan Kaur regarding her involvement in the sale of the Bradford Property).

d) CV-23-2454 (The Plaintiff’s claim against Canguard Group Limited (“Canguard”) the mortgagee on the Caledon Property).

[4] Mareva Orders and Certificate of Pending Litigation (“CPL”) orders have been granted in some of these proceedings. However, they play little role in the determination of these motions.

[5] Mr. D’Mello, the person at the center of the power of sales of both the Bradford and Caledon Properties, brought other proceedings which have both delayed and complicated the central issues in these proceedings – the validity of the powers of sale of the Bradford and Caledon Properties by him and the validity of the subsequent dealings with these properties:

a) CV-19-3245 (Mr. D’Mello’s claim against the Plaintiff and Justice Ricchetti). This claim was dismissed.

b) CV-22-2405 (Mr. D’Mello’s claim against the Plaintiff and the Attorney General of Ontario). This claim was dismissed; and

c) CV-22-2425 (Mr. D’Mello’s claim against the Plaintiff and Justice Ricchetti). This claim was dismissed.

[6] One of the unusual characteristics of these proceedings is the number of parties who have, despite serious allegations made against them, chosen to either not appear, not file any documents, not attend examinations and/or not file any responding materials on these summary judgment motions.

[7] Another unusual characteristic of these proceedings is the absolute refusal or failure to produce clearly relevant financial and corporate documentation, that would and should be available, going to the heart of the allegations, being whether the transactions involving the Defendants, with the two properties, were arm’s length, bona fide transactions, for value, without notice.

[8] As will be seen in these reasons, despite the passage of 6 years, the true beneficial ownership of the myriad defendant corporations involved are not known and is constantly shifting.

[9] Similarly, despite the passage of 6 years, the source and flow of monies into and out of the transactions at issue, involving these parties and these properties, remain entirely obscure.

[10] The only conclusion that can be drawn, and is drawn by this Court, is an inference that most of the Defendants have refused to produce relevant documents because to do so would be detrimental to their positions that their dealings with the two properties were arm’s length, legitimate/ bona fide , arm’s length transactions, for value and without notice.

[11] At the center of the dealings with these properties is Mr. Roy D’Mello, a lawyer who owns and directs several of the defendant corporations, acted as the solicitor on many transactions and had direct and indirect involvement in the dealings with these properties. Of importance as to whether these summary judgment motions should proceed, D’Mello submits to this court that he has no present interest in the Bradford Property nor the Caledon Property.

[12] An issue that does NOT need to be determined in these summary judgment motions is whether the Notice of Sale, dated November 20, 2017, by D’Mello (or his admitted companies 90761 and 11037), relating to the Bradford Property, was served in accordance with the Mortgages Act. I can and do, solely for the purpose of determining these summary judgment motions, proceed on the basis that the Notice of Sale for the Bradford Property was in compliant with the applicable statutory notice provisions. However, the assumed proper service of the Notice of Sale does not necessarily mean that the sale of the Bradford Property was to a bona fide purchaser for value without notice. Just because the Notice of Sale was properly served does NOT permit the mortgagee to engage in sham or fraudulent transactions – to non-arm’s length parties, not bona fide purchasers, or not for market value.

[13] Therefore, the issues to be decided, in these summary judgment motions, is whether a trial is required for a just and fair determination as to whether the transactions with the current owners and encumbrancers of the Bradford Property and/or the Caledon Property, were transactions to arm’s length, bona fide third purchasers/mortgagees for value without notice, or as I refer to it “sham or fraudulent transactions”.

[14] As set out below, title to the Caledon Property has already been restored to the Plaintiff by Judgment, in September 2023, because of the failure of the current owner, Bangia, to participate in these proceedings, which resulted in his pleading being struck and the deemed admission that the sale transaction to Bangia was a sham or fraudulent transaction.

The Law

Summary Judgment Motions

[15] The test for summary judgment motions is not in dispute.

[16] Rule 20.04(2) of the Rules of Civil Procedure permits a Court to grant summary judgment where “(a) the court is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence”.

[17] The Court should first determine if there is a genuine issue requiring a trial based only on the evidence before the Court on this motion, without resorting to the enhanced fact-finding powers as set out in R.20.04(2.1).

[18] If, after this step, it appears that there is a genuine issue requiring a trial, the Court should then determine if a trial can be avoided utilizing my powers under R.20.04(2.1) and (2.2) of the Rules of Civil Procedure to arrive at a fair and just determination of the issues on the merits. The fact-finding powers in Rules 20.04(2.1) and (2.2) of the Rules of Civil Procedure, being to weigh evidence, evaluate credibility, draw reasonable inferences, or receive selected oral evidence, are presumptively available to a summary judgment motion judge to use to fairly and justly adjudicate a claim: Hryniak v. Mauldin, 2014 SCC 7, at para. 45.

[19] Rule 20.04 (2.1) of the Rules of Civil Procedure confers powers on a judge in summary judgment motion:

In determining under clause (2) (a) whether there is a genuine issue requiring a trial, the court shall consider the evidence submitted by the parties and, if the determination is being made by a judge, the judge may exercise any of the following powers for the purpose, unless it is in the interest of justice for such powers to be exercised only at a trial:

1. Weighing the evidence

2. Evaluating the credibility of a deponent.

3. Drawing any reasonable inference from the evidence.

[20] A fair and just determination of the issues, on the merits, can be made where:

a) the evidence allows the judge to make the necessary findings of fact,

b) allows the judge to apply the law to the facts, and

c) is a proportionate, more expeditious and less expensive means to achieve a just result.

[21] The approach for summary judgment motions was summarized by Corbett J. in Sweda Farms Ltd. v. Egg Farmers of Ontario, 2014 ONSC 1200, at paras. 33 and 34:

As I read Hryniak, the court on a motion for summary judgment should undertake the following analysis:

1. The court will assume that the parties have placed before it, in some form, all of the evidence that will be available for trial;

2. On the basis of this record, the court decides whether it can make the necessary findings of fact, apply the law to the facts, and thereby achieve a fair and just adjudication of the case on the merits;

The Supreme Court is clear in rejecting the traditional trial as the measure of when a judge may obtain a “full appreciation” of a case necessary to grant judgment. Obviously greater procedural rigour should bring with it a greater immersion in a case, and consequently a more profound understanding of it. But the test is now whether the court’s appreciation of the case is sufficient to rule on the merits fairly and justly without a trial, rather than the formal trial being the yardstick by which the requirements of fairness and justice are measured.

(Emphasis added.)

[22] The fundamental question is not whether the procedure on the motion would be as exhaustive as a trial, but rather whether the evidentiary record on the summary judgment motion and the process gives the judge confidence to find the necessary facts and apply the relevant legal principles to decide the issues in a fair and just manner: See Hryniak at para. 50.

[23] The onus is on the moving party to establish that, based on the evidence before this Court on this motion, the Court can, with or without its enhanced fact-finding powers, make a fair and just determination without requiring a trial.

[24] For the reasons that follow, and given the claims and defences advanced, this Court requires its additional fact-finding powers. I come to that conclusion because there are simply too many relevant corporate and financial documents missing, many of which could and should have been produced, and in many cases ordered to be produced, but were not produced. Similarly, several Defendants have not filed responding materials. These failings are indications of a sham or fraudulent transaction which permit the Court to draw such an inference – which I do. For example, where the moving party has established a number of indications (or badges of fraud) that the mortgage was a sham or fraudulent mortgage amounting to a strong prima facie case of fraud, and the mortgagee has not advanced ANY evidence of the bona fides of the transaction, the totality of the evidence permits this Court to draw an inference and conclude that no trial is required to determine that no monies were advanced and/or the transaction was a sham or fraudulent.

[25] Simply put, to do justice, the Court must be able to make specific findings of fact based on the evidence and absence of evidence and inferences which might be drawn in these motions. To do otherwise would permit Defendants to ignore their obligations under the Rules of Civil Procedure, and the Court orders for production to defeat the purpose of summary judgment motions.

Is a Partial Summary Judgment appropriate in this case?

[26] Some of the Defendants submit this is not a proper case for partial summary judgment.

[27] The applicable principles to a summary judgment motion, when partial judgement is sought, are more complex and exacting than a “normal” summary judgment motion. See Service Mold + Aerospace Inc. v. Khalaf, 2019 ONCA 369:

[13] The standard of review in an appeal from a summary judgment ruling, including partial summary judgment rulings, was described concisely in Baywood Homes Partnership v. Haditaghi (2014), 120 O.R. (3d) 438, [2014] O.J. No. 2745, 2014 ONCA 450, at para. 30:

In Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87, at para. 81, Karakatsanis J. ruled that the exercise of powers under the new summary judgment rule attracts appellate deference. The question as to whether there is a genuine issue for trial is a question of mixed fact and law; in the absence of an extricable error in principle, or palpable and overriding error, this determination should not be disturbed on appeal.

[14] The principles that guide whether partial summary judgment is appropriate are, however, more complex than those that apply to summary judgment motions generally. In Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87, [2014] S.C.J. No. 7, at para. 60, Karakatsanis J. recognized that partial summary judgment may "run the risk of duplicative proceedings or inconsistent findings of fact" at trial. There is also the risk that partial summary judgment can frustrate the Hryniak objective of using summary judgment to achieve proportionate, timely and affordable justice. If used imprudently, partial summary judgment can cause delay, increase expense and increase the danger of inconsistent findings at trial made on a more complete record: Butera v. Chown, Cairns LLP (2017), 137 O.R. (3d) 561, [2017] O.J. No. 5267, 2017 ONCA 783, at paras. 29-33. These risks, which require careful consideration by motion judges, were known before Hryniak and Butera, as illustrated by this court's decision in Corchis v. KPMG Peat Marwick Thorne, [2002] O.J. No. 1437, [2002] O.T.C. 475 (C.A.), at para. 3. For this reason, while partial summary judgment has its place, it "should be considered to be a rare procedure that is reserved for an issue or issues that may be readily bifurcated from those in the main action and that may [page140] be dealt with expeditiously and in a cost effective manner": Butera, at para. 34.

(Emphasis added.)

[28] In this case, as stated above, while these claims relate to the same properties, at issue in these summary judgment motions is NOT validity of the service of the first power of sale by D’Mello (and his companies) of the Bradford Property, but the Plaintiff’s claim that the current owner (First National) and encumbrancer (11309) have obtained title/encumbrance through a sham or fraudulent transaction. Whether the Notice of Sale of the first power of sale of the Bradford Property was valid, remains an issue that might or might not be able to be decided by summary judgment or might require a trial.

[29] As stated above, in the Caledon Property, title to the property has already been restored to the Plaintiff given the failure of the current owner, Bangia, to participate in the applicable proceeding. As a result, only the registered mortgage (Canguard) on the Caledon Property is at issue.

[30] In my view, there are good reasons for determining that partial summary judgment is not only appropriate in this case, but it is necessary:

a) The transactions go back as far as 2018. A CPL has been registered on the properties, yet, it has been the Defendants who have delayed this matter from proceeding expeditiously. A Mareva Order is outstanding and, yet the alleged owners and or mortgagees to have done nothing for years but participate in the delay.

b) The validity of the various real estate transactions (ownership and mortgage) is simple and straightforward. Yet, the determination of these simple issues has been delayed and has resulted in very complex and expensive proceedings spanning more than 6 years with countless motions/applications and appeals.

c) The Plaintiff essentially became homeless after he “lost” these properties to the powers of sale. The Plaintiff has done everything he could to move this matter along at great expense. A few discoveries were, held several years ago (but undertakings remain outstanding), some discoveries were held recently, and, for other parties, discoveries have never been held despite Court Orders. The Defendants’ actions have made the current litigation process an unnecessarily expensive and inordinately lengthy.

d) The Defendants have been responsible for considerable, and mostly inappropriate, delays in bringing this to a judicial determination. There is over $180,000 outstanding cost awards against the Defendants. That says something about the meritorious actions of some of the Defendants. Dismissing these motions would simply add to and condone the Defendants’ conduct to take every step possible to delay these proceedings. The words “timely and affordable” justice has been deliberately thwarted by the Defendants through their actions and numerous motions that needed to be brought by the Plaintiff to obtain compliance and move these actions forward. This is borne out by the sheer difficulty and delay in getting the Defendants to produce affidavits of documents, and/or attend discoveries (even despite court orders), repeated unsuccessful appeals, and bringing multiple additional proceedings as collateral attacks. I only need to point to these motions to demonstrate the Defendants’ continuing effort to delay these summary judgment motions. The Plaintiff’s motion record was served in January 2024. The Defendants ignored this Court’s peremptory timetable set in January 2024 for these motions by not filing ANY responding materials by ANY Defendant by the date for these steps set by the court. The Plaintiff had to seek another judicial conference. At this second scheduling conference the Court set another timetable and made it clear the motion would go ahead with or without responding materials on the scheduled hearing date. Despite this, in the last minute, the day of the hearing, D’Mello sought an adjournment to cross-examine despite having missed the Court’s date to conduct cross examinations. Then, shortly before the hearing, 11039 moved to amend its pleading and 11039 sought to deliver late responding materials. Then, shortly before the hearing, D’Mello brought a motion to remove the Plaintiff’s counsel. Then, shortly before the hearing, D'Mello brought a cross-motion with respect to the validity of the service of the Notice of Sale for the Bradford Property. I have not doubt, the purpose of these last-minute steps, was to try to further delay this proceeding. I cannot say it better than was said by J. Daley when dealing with D’Mello’s claims in D’Mello v. Sapusak et al., 2023 ONSC 3088 at para.1:

[1] The applicant [D’Mello] in the two above-styled proceedings continues his unrelenting and continuous campaign of stonewalling and delay of the underlying civil action by weaponizing the Rules of Civil Procedure, in order to obstruct the court’s due process.

e) The Court has awarded costs against some of these Defendants. In total, there is over $180,000 in outstanding cost awards. Most against D’Mello. Some cost awards have been outstanding for years. The Defendants have simply ignored them. Knowing the Plaintiff’s precarious financial position, the Defendants have deliberately created extreme financial hurdles for the Plaintiff to continue these proceedings.

f) The result on these motions may very well end these proceedings, resulting in reduced litigation expense and the use of fewer judicial resources. Further, if the issue of the current ownership and status of the encumbrances, can be fairly and justly determined at this time, there will be considerable saving of time and expense. The sole remaining issue will be the legality and validity of the powers of sale by D’Mello and any damages which might flow from the determination.

g) There is no risk of inconsistent findings. Whether the original Notice of Sale of the power of sale proceedings by D’Mello were valid at law, is entirely independent of the results in these summary judgment motions. This becomes plain and obvious when D’Mello admits to this Court that neither he, nor his companies, currently have any interest in either property. In fact, if the summary judgment motions are successful, the claim against D’Mello may very well become a much simpler claim (if it proceeds) and, in any event, would likely reduce any damages the Plaintiff might recover against D’Mello since the Plaintiff has recovered his properties.

h) These summary judgment motions can and, in my view, do properly, efficiently and without prejudice or risk to the parties permit an expeditious and cost-effective resolution of the fundamental issues. See Butera v. Chown, Cairns LLP, 2017 ONCA 2017.

i) To conclude, as directed by the Court of Appeal at para. 62 of Malik v. Attia 2020 ONCA 787, I am satisfied that the Plaintiff has:

i. Demonstrated that dividing these issues from the remaining issues will prove cheaper for the parties as the fundamental issue in all these proceedings is the return of the properties to the Plaintiff.

ii. Demonstrated that this will get the case in and out of the Court system more quickly. If the motions are successful, there will be little left for the Plaintiff to pursue.

iii. Demonstrated that the partial summary judgement will not result in inconsistent findings. Even if successful, the remaining issue will be whether the Notice of Sale of the properties were properly served, an entirely independent issue involving other parties than the current owners and encumbrancers.

[31] I am satisfied that this is one of those rare cases that a partial summary judgment is appropriate.

The Fraudulent Conveyances Act

[32] The relevant provision in The Fraudulent Conveyances Act is section 2, which reads as follows:

Every conveyance of real property or personal property and every bond, suit, judgment and execution heretofore or hereafter made with intent to defeat, hinder, delay or defraud creditors or others of their just and lawful actions, suits, debts, accounts, damages, penalties or forfeitures are void as against such persons and their assigns.

[33] The Fraudulent Conveyances Act is clearly remedial in nature and should be given a fair, large, and liberal interpretation that best achieves its purpose, namely, to strike down all conveyances and property transactions (which would include mortgages as a mortgage creates a beneficial interest in the property to the mortgagee) of property made with the intention of delaying, hindering, or defrauding creditors and others except for conveyances made for good consideration and bona fide to persons not having notice of such fraud. See Stevens v. Hutchens, 2022 ONCA 771 at para. 18.

[34] In Snook v. London & West Riding Investments, Ltd., [1967] 1 All E.R. 518, p. 528. Lord Diplock said:

As regards the contention of the plaintiff that the transactions between himself, Auto-Finance, Ltd. and the defendants were a “sham”, it is, I think, necessary to consider what, if any, legal concept is involved in the use of this popular and pejorative word. I apprehend that, if it has any meaning in law, it means acts done or documents executed by the parties to the “sham” which are intended by them to give to third parties or to the court the appearance of creating between the parties legal rights and obligations different from the actual legal rights and obligations (if any) which the parties intend to create.

(Emphasis added.)

[35] In Koop v. Smith (1915), 1915 SCC 26, 51 S.C.R. 554 at p. 555, 25 D.L.R. 355, the Court stated:

. . . the rule laid down by the courts of Ontario with regard to assignments made between near relations and impeached by the creditors of the assignor as fraudulent as a salutory one, namely, that where it is accessible some corroborative evidence of the bona fides of the transaction should be given.

(Emphasis added.)

[36] In Re Dougmor Realty Holdings Ltd., 1966 ONSC 214, [1967] 1 O.R. 66, 59 D.L.R. (2d) 432 (H.C.J.) the Court discussed the shifting evidentiary burden once prima facie fraudulent circumstances have been:

Suspicious circumstances coupled with the close relationship between the transferee and the debtor make a sufficient prima facie case of fraud. From that point, the burden of producing credible evidence substantiating the transaction is upon those who set it up. If substantial valuable consideration is truly given for a transfer of lands, there must be better evidence of it than the recitals in the deed and the land transfer tax affidavit.

(Emphasis added.)

[37] Reliance on s. 78(4) of the Land Titles Act, cannot be relied upon to validate a registration of a fraudulent instrument. See s. 78(4.1). Section 78(4) can only be relied upon by bona fide purchasers for value without notice of an interest or claim that differs from what is shown on the Register. See Martin v. 11037315 Canada Inc., 2022 ONCA 322 at para. 66.

[38] The lack of documentation is one indicator of a sham or fraudulent transactions. See Hilltop Group Ltd. v Katana, 2002 CarswellOnt 2058, at para. 124 (SCJ), where the Court relied as an indication of a sham or fraudulent transaction that “the Trust has no bank account, no monies, no books, or records, has filed no income tax trust returns, and has made no distributions to beneficiaries. The Trust has been totally inactive and dormant throughout its existence to the present date. Somehow, without any funds or borrowings from the bank or the bank account, the Trust acquired shares in MAK.”.

Preliminary Matters

Amendment of the Statement of Claim

[39] The Plaintiff sought to amend the Statement of Claim (a draft was delivered months ago). No one opposed.

[40] This relief is granted. The Plaintiff is hereby granted leave to amend its Statement of Claim in the form attached as Schedule A to the Notice of Motion dated January 4, 2024.

Motion to Remove Mr. Colville-Reeves (Plaintiff’s Counsel)

[41] At the last moment before this hearing, D’Mello brought a motion to remove Mr. Colville-Reeves and Reeves Richarz LLP as solicitors of record for the Plaintiff. See undated Cross Motion (Case Center B-1-79).

[42] Shortly after the beginning of this hearing, D’Mello advised the Court that he was not prepared to proceed today with respect to this motion. This motion (not authorized by this Court for hearing today) was served shortly before these motions had been scheduled for hearing. Why? There is no real explanation for doing so. This is another attempt to delay these proceedings by D’Mello.

[43] D’Mello acknowledged that he (and his companies in these proceedings) have $152,895 in cost awards that have not been paid to the Plaintiff. Some of these cost awards have been outstanding for a considerable time.

[44] In these circumstances, in any event, I would not have heard D’Mello’s motion without D’Mello, first, having paid all outstanding cost awards. To permit otherwise would make cost awards meaningless and permit, as done in this case, D’Mello to bring motions, take steps and positions in this litigation for what appears to be solely for the purpose of delaying this proceeding without regard to cost consequences.

[45] This motion is not returnable before the Court, unless and until D’Mello has paid all the outstanding cost awards against him and his companies.

Declaration that the Notice of Sale dated November 2017 for the Bradford Property was valid

[46] Shortly before this hearing, D’Mello brought a cross motion seeking:

A declaration that the Notice of Sale dated November 20, 2017 [Bradford Property] was served on the plaintiff, in accordance with the Mortgages Act.

[47] This motion was not scheduled at the January 2024 conference to be heard on this date. D’Mello did not advise he sought to bring this cross-motion until he served, filed and uploaded the materials just a few days before this hearing.

[48] For the reasons stated above, it is not necessary to deal with this cross motion. If D’Mello wants to pursue this motion, he may do so later by motion or at trial but only if D’Mello has paid all outstanding cost awards against him and his companies.

[49] While the Plaintiff had claimed a declaration regarding the validity of the first power of sale in the Notice of Motion, but only if it was necessary for the central relief, which was to return the properties to the Plaintiff. That relief is no longer being pursued by the Plaintiff today. As a result, there is no relief sought by the Plaintiff against D’Mello or his companies on these summary judgment motions relating to the propriety of the power of sale notice issued by D’Mello with respect to the Bradford Property.

[50] For the reasons set out above, this D’Mello cross motion does NOT need to be heard or decided at this time.

The Richarz Affidavit

[51] D’Mello and Mr. Randhawa (on behalf of 11039) submit that I should strike Mr. Richarz’ affidavits.

[52] The primary objection is that Mr. Richarz attaches earlier sworn affidavits of Mr. Sapusak previously filed in this proceeding as part of this motion record, rather than newly sworn, and filed affidavits, in the same form. The Defendants claim that Mr. Richarz has no personal knowledge of the matters set out in the prior affidavits of Mr. Sapusak.

[53] The Defendants also suggest that the appraisal relied on by the Plaintiff relies on facts provided by Mr. Colville-Reeves and/or Mr. Richarz.

[54] There is no merit to these submissions.

[55] These actions have been outstanding for 6 years. Mr. Sapusak’s affidavits were clearly attached to the Plaintiff’s Motion Record to ensure they formed part of the summary judgment evidentiary record.

[56] The Defendants knew since January 2024 that the earlier Sapusak affidavits were being relied upon on these motions.

[57] The Defendants didn’t raise this objection in the earlier conferences with the Court to schedule these motions.

[58] There was no request by the Defendants to examine or cross-examine Mr. Sapusak on the earlier affidavits.

[59] There was no request to examine Mr. Sapusak as a witness on a pending motion.

[60] There was no motion to strike Mr. Sapusak’s earlier affidavits, even though the Motion Record had been served some five months ago.

[61] Nothing. Until the eve of the hearing of these motions in what appears to be an attempt to again delay the hearing of these motions by the Defendants.

[62] As for the appraisal issue, I note the Defendants didn’t examine the appraiser to determine what facts (and the source) were relied on to determine the appraised value. The Defendants didn’t attempt to get their own appraisal or file an appraisal on these motions.

[63] I reject the Defendant’s submissions. All affidavits included in the Plaintiff’s Motion Record and Supplementary Motion Record are properly before the Court.

Late Filed Affidavits from the Plaintiff

[64] The timetable was set many months ago in January 2024.

[65] Then when the timetable was not complied with by the Defendants. They had filed nothing in response to these motions by the time the responding materials were due. The Court gave the Defendants one further amended timetable to file materials. Some of the Defendants filed responding materials. Many Defendants did not.

[66] Now the Plaintiff wants to file late additional affidavits to respond to some of the very late responding affidavits or D’Mello’s cross motion. If granted, this would likely result in an adjournment request by the Defendants.

[67] In those circumstance, the Plaintiff chose not to proceed with those affidavits.

[68] The Plaintiff’s affidavit of Shawn Richarz dated May 6 and 7, 2024 are struck.

Adjournment for Cross-examination

[69] D’Mello sought an adjournment to cross-examine the Plaintiff. This was first raised on the hearing date.

[70] There has been 6 years of delay in this proceeding. The vast majority due to the Defendants, in particular by D’Mello. As I said in a prior endorsement of the Defence delays – “the delays in moving this file forward are legendary”.

[71] This motion was served back in early January 2024.

[72] At a conference before me on January 12, 2024, a timetable was set which included that the responding materials be delivered by February 16, 2024. At the same conference, the timetable provided that cross-examinations were to be completed by April 5, 2024. I ordered that the “timetable cannot be varied without a court order except where all parties agree in writing to the variation”.

[73] Yet, by the next conference on April 18, 2024, there had been NO responding materials filed by any Defendant; only an unsworn affidavit from Mr. Randhawa’s client (11039) had been delivered.

[74] These motions could have gone ahead without any responding materials.

[75] But by April 18, 2024, not only had the Defendants not filed any responding records, but there were also no requests nor attempts by the Defendants to conduct any examinations or cross-examinations of the Plaintiff or Mr. Richarz.

[76] The Defendants just continued to ignore directions and Court Orders to move this matter forward or complete the steps so that the hearing would proceed on the date scheduled for the hearing.

[77] Absent some clear and compelling prejudice, such conduct cannot be countenanced by the Court to permit yet a further delay in these motions being heard. In these circumstances, I am satisfied it is entirely unconscionable to grant an adjournment to permit D’Mello to cross-examine the Plaintiff. This is particularly so when D’Mello admits he no longer has an interest in the current ownership or mortgages on the properties. One must ask themselves why D’Mello continues to participate in these motions by a cross-examination or otherwise if this is true.

[78] Cross-examination is not a right. For the above reasons, I decline to grant the adjournment for this purpose.

[79] In any event, D’Mello admits that there is $152,895 in cost awards that he has not paid to the Plaintiff. These have been outstanding for a considerable time. In these circumstances, I would not have heard D’Mello’s motion or granted the relief he seeks without D’Mello first having paid all outstanding cost awards.

11039 Amendment

[80] On May 2, 2024, just two days before the hearing was scheduled, 11039 brought a motion to amend its Statement of Defence.

[81] Nevertheless, there was no opposition to the amendment by the Plaintiff who simply wanted to go ahead with these motions.

[82] I am satisfied that the amendments whereby 11039 seek to rely on the provisions of the Mortgages Act and the Land Titles Act which protects bona fide purchasers for value without notice, are already a central issue in these summary judgment motions.

[83] Leave for 11039 to amend its Statement of Defence as set out in the Draft Amended Statement of Defence dated May 2, 2024 (Case Center B-2-318) is hereby granted.

What is Not Before the Court?

[84] There is a considerable amount of material which is not before this Court:

a) No responding materials from 11037.

b) No responding materials from Amritpal Singh Kullar.

c) No responding materials from 1152729 B.C. Ltd. (“11527”).

d) No responding materials from Kassiedass.

e) No responding materials from Saldana (or his estate).

f) No responding materials from Apex (who allegedly did work on the Property).

g) No timely responding materials from 11039. None was served before the Court’s deadline for delivery nor its second deadline for delivery of responding materials. Then, 11039 sought leave to rely on its April 26, 2024, motion record. Mr. Durdyev was cross-examined on May 2, 2024.

h) No responding materials from First National; and

i) No financial and other documentation of all the transactions at issue in these proceeding which involved D’Mello personally, his firm or his companies. In addition to some undertakings and his obligation under the Rules of Civil Procedure, there was a Court Order directing D’Mello to produce all this documentation. This Court Order was ignored.

The Bradford Property

[85] The Plaintiff seeks the following relief by way of summary judgment:

a) An Order for summary judgment against First National and 11039 that their dealings with the Bradford Property were not arm’s length, bona fide for value, without notice. In other words, the two transactions involving these parties were sham or fraudulent transactions and should be set aside.

b) If successful on (a) and, as a result, an Order transferring the ownership of the property municipally known as 3284 4th Line, Bradford, Ontario (Bradford Property) from First National to the Plaintiff; and

c) If successful on (a) and, as a result, a declaration and Order discharging the mortgage registered as Instrument Number SC1598613 in favour of 11039 as a fraudulent conveyance under the Fraudulent Conveyances Act.

The Defences

[86] First National pleaded that Parduman Kassiedass is First National’s sole shareholder. First National pleads that it purchased the Bradford Property in February 2019 for $750,000. First National pleads a denial that it had any knowledge of any fraudulent scheme. Accordingly, First National pleads it is and should remain the registered owner of the Bradford Property.

[87] 11039 claims its registered mortgage on the Bradford Property was a bona fide transaction for value, for which it says it advanced $750,000 for First National’s acquisition of the Bradford Property. Accordingly, 11039 claims its mortgage is a valid registered mortgage for the full amount. 11039 also relies on the provisions of the Land Titles Act and the Mortgages Act that its mortgage rights are indefeasible.

Evidence and Analysis

[88] D’Mello is the principal of 9706151 Canada Inc. (97061), and 11037315 Canada Inc. (11037). Any reference to D’Mello will include reference to either or both 97061 and 11037.

[89] The property at issue is located at 3284 4th Line in Bradford, Ontario (“the Bradford Property”). The Bradford Property is approximately 7.2 acres near Highway 400 and Holland Marsh.

[90] There is a second property, related to the dealings with the Bradford Property by some of these defendants - 11 Royal Terrace Crescent, Bolton, Ontario (“the Caledon Property”).

[91] The Plaintiff had a first mortgage on his Bradford Property with Home Trust for $432,000 registered on June 17, 2011. This mortgage was also registered on the Caledon Property as a second collateral mortgage.

[92] The Plaintiff had a first mortgage on his Caledon Property with Home Trust for $200,0000 registered in June 2011.

[93] As a partial refinancing of the Home Trust loans, D’Mello, through 97061, provided a mortgage commitment to the Plaintiff for $320,000. The $326,000 loan (slight increase) was to become a first mortgage on the Caledon Property and a second collateral mortgage on the Bradford Property.

[94] The monies from D’Mello were to be used to pay out the first mortgage to Home Trust on the Caledon Property ($227,583.30) and the arrears of $59,650.30 to Home Trust’s first mortgage on the Bradford Property.

[95] The entire financial liability of the Plaintiff, which resulted in the powers of sale by D’Mello of both the Bradford and Caledon Properties, stem from that $326,000 loan to D’Mello (97061).

[96] After the D’Mello loan was advanced, Home Trust was to no longer to have a mortgage on the Caledon Property as it would be replaced with D’Mello’s (97061) first mortgage. Home Trust would continue to have ONLY the first mortgage on the Bradford Property and D’Mello (97061) would have a second collateral mortgage on the Bradford Property.

[97] The D’Mello financing was completed on April 13, 2017. The loan monies properly disbursed as described above.

[98] Through inadvertence, the Home Trust’s second collateral mortgage on the Caledon Property was not discharged, although it is clear from all the documentation, including written communications exchanged with D’Mello, that the Home Trust collateral mortgage on the Caledon Property was to have been discharged upon the D’Mello financing.

[99] The D’Mello loan went into arrears.

[100] At the time of the power of sale of the Caledon Property, D’Mello claims he was owed $436,168.24 on the $326,000 financing. For the purpose of these motions, I will accept the quantum claimed being $436,168.24, notwithstanding obvious potentially questionable amounts, set out in D’Mello’s Notice of Arrears.

[101] The Caledon Property was sold by D’Mello, under a power of sale, for $440,000. Essentially, the sale proceeds of the Caledon Property would have paid out or close to pay out the D’Mello financing in full. Had the D’Mello financing been paid out in full, D’Mello would have had no further security or enforcement rights to either the Bradford Property or the Caledon Property. In other words, there would be nothing owing under D’Mello’s collateral second mortgage on the Bradford Property.

[102] However, instead of repaying his loan/first mortgage on the Caledon Property and his collateral second on the Bradford Property, D’Mello used the proceeds of sale from the Caledon Property to pay out the Home Trust first mortgage on the Bradford Property. D’Mello then used the fact that there were arrears to also sell the Bradford Property under a power of sale.

[103] The questionable legality and bona fides of D’Mello’s actions to create this liability on both the Bradford and Caledon Property’s, is not decided in this motion. Solely for the purpose of these motions, I accept that D’Mello had the right and proceeded with a valid power of sale, with proper Notice, even though the validity of the Bradford Property power of sale, for a number of reasons, is hotly contested.

[104] Returning to D’Mello’s dealings with the Bradford Property, the Bradford Property was listed on February 1, 2018, with a realtor, D’ Mello’s wife, Harcharan Kaur (“Kaur”), who ‘double ended’ the sale (meaning she acted as the listing agent for D’Mello and the selling agent for the purchaser).

[105] Six days after listing, on February 7, 2018, D’Mello sold the Bradford Property to 1152729 B.C. Ltd. (“11527”), a company controlled by the Defendant, Amritpal Singh Kullar (I will refer to 11527 and Mr. Kullar as “Kullar”). Kullar is a resident of Ontario.

[106] The Bradford Property sold for $440,000. The Plaintiff’s appraisal valued the Bradford Property, at that time, for $750,000. It is the only appraisal in the evidence. This is a significant indication of a sham or fraudulent transaction.

[107] Kullar’s reasons for purchasing the Bradford Property, are highly questionable as he said he was looking to purchase land for a nursing home but he had not done anything to consider or advance this alleged business plan such as considering whether the Bradford Property could be developed as such (it was listed as a “residential property”), a draft business plan, enquiries whether financing was available, nor had he even spoke to his proposed business partner in British Columbia (“B.C.”) about his decision to buy the Bradford Property.

[108] Kaur (D’Mello’s wife) and Kullar had known each other for years.

[109] To avoid the appearance of a non-arms length transaction, both D’Mello and Kullar pleaded in their personal and corporate Statements of Defence that they do not know each other. D’Mello and Kullar each provided sworn testimony they did not know each other. For example, D’Mello provided sworn evidence on four separate occasions, in 2018, 2019, 2020 and 2023, in both Affidavit and viva voce testimony, that he didn’t know Kullar. Clearly, both D’Mello and Kullar sought to avoid disclosure of any prior relationship.

[110] However, there are unquestionable prior connections between Kullar and D’Mello in the past. D’Mello was Kullar’s lawyer in several mortgage enforcement proceedings. This deception of their prior relationship is another indication of a sham or fraudulent transaction and that Kullar was not a bona fide third-party purchaser.

[111] To add to this indication that this was a sham or fraudulent, Kullar denied having any knowledge about mortgages except his home mortgage. Yet, it’s clear that he had previously held mortgages, some which went into default, and had retained D’Mello to act as his lawyer to enforce those mortgages.

[112] As required under the Agreement of Purchase and Sale, Kullar was to have provided a $5,000 deposit. Yet, Kullar did not produce any documentation evidencing the payment of this deposit. Neither has D’Mello (97061) produced any documentation evidencing the deposit.

[113] As part of the power of sale to Kullar, D’Mello (97061) retained a vendor take back mortgage (“VTB”) for $250,000. As such, Kullar (11527) was required to pay on closing approximately $191,000 ($440,000 less $250,000). However, neither Kullar nor D’Mello, despite a Court Order, produced any documents which show that ANY monies were paid by Kullar, or his company, on closing. Kullar has also failed or refused to provide the source of the $191,000 he needed to close the purchase. There is simply no evidence of any “value” paid by Kullar to acquire the Bradford Property.

[114] D’Mello, the principal of 97061, the lawyer on the transaction and through whose firm the closing funds were alleged to have passed, has, despite a specific Court Order to do so, refused to produce all documents related to this transaction including the details and documentation showing the source and distribution of the closing funds.

[115] There are outstanding undertakings and “under advisements” with respect to the financial documents regarding this transaction. These have been outstanding for years (approx. 2022). Some remain outstanding, despite Court Orders to comply and produce the documents.

[116] The failure or refusal by both Kullar and D’Mello to produce the detailed financial documentation of this transaction is a significant indication of a sham or fraudulent transaction.

[117] To be fair, there are a few lawyer’s statement of receipts/disbursement, including from D’Mello’s law firm, regarding financial monies received and disbursed. The source and distribution documentation should have maintained by D’Mello’s law firm and produced when ordered. The limited statements do not establish the source and distribution of the monies involved in this transaction. This is especially problematic for the Defendants where there are indications that the transaction was a sham or fraudulent.

[118] I am satisfied that the Plaintiff has established a strong prima facie case that the sale transaction by D’Mello to Kullar, and the related VTB to D’Mello, was a sham or fraudulent transaction.

[119] Neither Kullar nor D’Mello have adduced any evidence to rebut the strong prima facie claim of a sham or fraudulent transaction advanced by the Plaintiff.

[120] I can and do find that Kullar was not a bona fide purchaser for value nor was he an arm’s length purchaser.

[121] The D’Mello sale to Kullar was a sham or fraudulent transaction.

[122] Similarly, and for the same reasons, the VTB mortgage was also a sham or fraudulent mortgage.

[123] This sale transaction from D’Mello to Kullar is not the central issue to be decided on these motions. I simply include this as further evidence that the subsequent sale transaction, again by D’Mello, was a further sham or fraudulent transaction. Why conduct a second sham or fraudulent sale transaction? Because legal proceedings had been commenced by the Plaintiff to set aside the sale to Kullar and VTB mortgage and was taking steps in court to ensure there were no further dealings with the Bradford Property. Hence, the second power of sale transaction was an attempt by D’Mello to avoid being enjoined by the courts from dealing with the Bradford Property.

[124] This is what happened.

[125] According to Kullar and D’Mello, D’Mello’s VTB went into default later that same year in December 2018. This was shortly after the Plaintiff had commenced the CV-18-1310 action.

[126] Yet, while the 97061 VTB was allegedly in default, Kullar leased the Bradford Property to Kassiedass (another party to these proceedings who has not appeared or produced any documentation and refused to attend for examinations). Kullar (11527) granted a lease to Kassiedass for $2,500 per month. And gave Kassiedass a 5-month free rent period. And how did this “lease” come about? Mr. Kullar said that Kassiedass just “happened” to pull into this rural property when Kullar “happened” to be there and asked if it was for rent. This was a rural property with no one living there! This coincidence is highly questionable.

[127] Proceedings, in 2018, were then brought by the Plaintiff seeking to set aside the first power of sale to Kullar (the purchase and the VTB mortgage), prompting a motion by the Plaintiff to seek an interlocutory order for a CPL to prevent further dealings with the Bradford Property.

[128] When the CPL motion was to be heard, like so often in these proceedings, the Defendants sought and obtained an adjournment. The Court ordered Kullar (11527) to provide advance notice of intention to repay any of the VTB.

[129] On January 17, 2019, while the CPL motion was outstanding, the VTB was assigned by D’Mello’s 97061 to D’Mello’s other corporation,11037.

[130] When the adjournment was requested, neither D’Mello nor Mr. Kullar disclosed to the Court, that the VTB had been assigned or that the VTB was in default. Nor did they advise the Court that power of sale proceedings was being pursued by D’Mello’s, new assignee of the 97061 VTB mortgage, 11037.

[131] During the adjournment of the pending CPL motion, D’Mello (11037) proceeded to sell the Bradford Property again, under a further or second power of sale. This time to First National, a company owned by Kassiedass for $750,000 - the person who leased the Bradford Property and was, at the time, in a “rent free” period.

[132] I find that the second power of sale to First National was done by D’Mello to avoid the ongoing litigation and was an attempt to deal with the Bradford Property before it could be “enjoined” by the Court. This inference is not without considerable similarities to other transfers by D’Mello to defeat Court Orders. See Martin v. 2670082 Ontario Corp, 2024 ONSC 3982 where D’Mello transferred a different property from 11037 (the same company in these proceedings) to another one of his companies, 2670082 Ontario Corp. and then took the position that the purchaser was not bound by the Court Order:

[45] At the time of the sale of the property, D’Mello and 110 were bound by a Mareva injunction ordered by Dennison J. on July 24, 2019 (Sapusak v. 9706151 Canada Ltd. et al (24 July 2019), Brampton, CV-18-13100-00 (Ont. S.C.), at para. 41 [Sapusak]), subsequently amended by Doi J. on August 14, 2019 (Sapusak (14 August 2019), at para. 1) and extended by Petersen J. on May 25, 2022 (Sapusak (25 May 2022), at para. 2). At this trial when he testified, D’Mello claimed that the Mareva injunction was not in effect in December 2019. He claimed that selling the property to 267 was not “dealing with property” in a way that breached the injunction.

[133] There are several aspects of D’Mello’s second power of sale of the Bradford Property that indicate a further sham or fraudulent transaction, including:

a) Given the purported sale price to First Nations, there would have been approximately $384,156 remaining from the equity after D’Mello’s (11037) assigned $250,000 VTB. The owner, Kullar, would have been entitled to those monies. When questioned about this surplus, Kullar testified that he got these monies but could not recall if he got the cheque or 11527 got the cheque. Nor is there any financial document showing receipt of those monies by Kullar or his company. Of course, as already said several times, D’Mello, a party, a lawyer and recipient of the alleged trust monies, has refused to produce his records of the transactions – including this one – which would have shown the source and distribution of all the funds, including whether any monies were forwarded to Kullar. There is simply nothing produced by Kullar nor D'Mello regarding the proceeds of sale of the second power of sale.

b) The entire $750,000 purchase price was funded by mortgage from 11039, another company incorporated by D’Mello. The result is that First National paid nothing for the Bradford Property. What is important is whether there is any financial documentation that $750,000 was actually paid by the purchaser to the vendor to acquire the Bradford Property. There is no such documentation.

[134] This is very strong evidence that this second power of sale was a sham or fraudulent transaction.

[135] Turning now to First National, the purported purchaser under D’Mello’s second power of sale.

[136] First National is the current registered owner of the Bradford Property. According to its pleading, Kassiedass is the sole shareholder of First National. Kassiedass is also a personal defendant in these proceedings.

[137] Aside from a Defence, Kassiedass has essentially ignored these proceedings by not producing documents or attending examinations. After several failed attempts to examine Kassiedass for discovery, Kassiedass was ordered to attend examinations for discovery in February 2023. Again, he didn’t attend. However, before this could return to Court to deal with this failure to attend, a surprising development occurred.

[138] Shortly after Kassiedass failed to attend the Court ordered examination for discovery, according to Thomas Hipsz (“Hipsz”), Kassiedass was no longer the owner of First National. According to Hipsz. In fact, according to Hipsz, Kassiedass had sold all the shares of First National to Hipsz in 2019 for $16,000. That is correct, well before Kassiedass had defended this action and Kassiedass’ multiple failures to produce documents or attend examinations on behalf of First National. All with no mention of Hipsz.

[139] As is so common in these transactions, there is no evidence regarding First National, its shareholders, directors, assets, or other financial information regarding this alleged share transaction.

[140] As for the alleged share purchase price, Hipsz, has not provided any documentation to show any payment for First National’s shares, nor that the shares of First National were transferred to him. Nothing.

[141] These circumstances and this failure to produce this documentation is a strong indication of a sham or fraudulent transaction.

[142] Then there is the fact that First National did not make and has not made a single payment on the $750,000 mortgage. Not one. In five (5) years. This is a further indication of a sham or fraudulent transaction.

[143] Based on the above, the inescapable conclusion is that the Plaintiff has established a very strong prima facie case that the purported purchase by First National was not a bona fide purchaser purchaser for value of the Bradford Property but rather was a sham or fraudulent transaction.

[144] But there is more evidence that the entire First National purchase and mortgage transaction was a sham or a fraudulent transaction.

[145] Recall that the entire purchase price of $750,000 was the subject of a mortgage in favour of 11039.

[146] As stated above, no mortgage payments by First National to 11039 were ever paid. As a result, 11039 did not receive any mortgage payments for 5 years. 11039’s indebtedness would increase each month. There is no evidence that 11039 took any steps to collect its monthly payments or take steps to enforce its mortgage. Yet, more than five years have gone by.

[147] There is simply no commercial reality to such a transaction. The purchaser pays nothing for the property, the alleged mortgage secures the entire purchase price; and the mortgage is not paid and ignored by the purchaser and the mortgagee for more than 5 years.

[148] These circumstances lead to a strong indication that the entire transaction is a sham or fraudulent transaction.

[149] But there is more.

[150] For the 11039 mortgage to be valid, 11039 would have had to advance the $750,000 to First National, or the vendor on First National’s behalf, to close the purchase.

[151] 11039 has had no bank account. So how did 11039 get the money, from who and how did it advance the monies to First National to allow it to close the purchase transaction with 11037? All these questions are unanswered as there are no financial documents showing the source, transfer, or distribution of the monies from any of the parties to the transaction or their lawyers, including D’Mello.

[152] Neither First National, nor 11037 nor 11039 have produced an y documents of the $750,000 advance from 11039 payable to First National or directed to 11037 on First National’s behalf for the closing purchase price. No source documents. No distribution documents. Nothing.

[153] On this basis alone, with the Plaintiff’s strong prima facie case of fraud having been made out, 11039’s mortgage would be invalid as no monies were advanced.

[154] But there is more.

[155] D’Mello denies that he has an interest in 11039. D’Mello states he incorporated it at the request of Saldana.

[156] It is noteworthy that 11039 was incorporated by D’Mello on the same day that he incorporated 11037, meaning that D’Mello incorporated the prior mortgagee (11037) and the subsequent and now current mortgagee of the Bradford Property (11039) on the same day. Such a coincidence, without any explanation especially from Saldana, is an indication of a sham or fraudulent transaction.

[157] Then there is the fact that Saldana’s name is not on any conveyancing documents. Who signed the mortgage documents? Kassiedass signed the commitment letter for both First National and for 11039. Not Saldana or someone else on behalf of First National. It makes no sense that Kassiedass would sign on behalf of the owner and the mortgagee.

[158] It is also noteworthy that, if the alleged purchase by First National was a sham or fraudulent transaction, it would require the mortgage to 11039, to also be a sham or fraudulent transaction. One cannot exist without the other also being a sham or fraudulent transaction.

[159] The common denominator to the transactions continues to be D’Mello, as the principal of some companies, the lawyer involved in the transactions, the use of his trust account, and the incorporator to the various companies involved in the transactions. The same person who has failed to produce financial and transactional documentations despite a Court Order.

[160] Now, given the cumulative evidence from above, a very strong prima facie case, again, is made out that the 11039 mortgage is a sham or fraudulent transaction.

[161] But there is more evidence that this sale and mortgage transaction were a sham or fraudulent transaction.

[162] Kassiedass and First National failed to attend examinations for discovery on several dates. I repeat, despite a Court Order to attend, Kassiedass and First National failed to attend discoveries in February 2023. A further Order was made requiring him to attend. Then, Kassiedass could no longer be found.

[163] In July 2023, in response to an Order that First National attend an examination for discovery, Hipsz, announced his 100% shareholder interest in First National and that he was now a director.

[164] Remember, that D’Mello testified in approximately 2022 that he sold the Bradford Property to Kassiedass, the tenant. But, now enter Hipsz.

[165] The details of the share transfer from Kassiedass to Hipsz was the subject of questions at Hipsz’ examination.

[166] Hipsz testified he “believes” he bought the First National shares from Kassiedass. While Hipsz testified “paperwork” was signed by him and Kassiedass evidencing the share transfer, he no longer has this documentation. In fact, there is not a single document showing this alleged share purchase transaction. There is NOTHING to show this transaction was real or ever occurred.

[167] And this alleged share purchase by Hipsz of all First National shares makes no commercial sense. The alleged agreement between Hipsz and Kassiedass was that:

a) Hipsz would provide $16,000 for the closing costs.

b) Kassiedass would arrange a mortgage through a ‘countryman’.

c) Hipsz would own all the shares in First National; and

d) Kassiedass would make the mortgage payments of $4,993.75 per month (despite the fact Kassiedass would no longer have any interest in First National, and even though Hipsz knew that Kassiedass couldn’t even come up with the $16,000 closing costs for the purchase).

[168] Hipsz testified he knew nothing about the financial condition of First National at the time of the purported acquisition. For example, Hipsz didn’t know whether First National had filed tax returns, had any year end financial statements, had ever paid interest to the $750,000 mortgage.

[169] Hipsz knew no details or information about the Bradford Property, the only asset of First National.

[170] Hipsz never asked about nor saw the $750,000 financing for the alleged purchase of the Bradford Property. A highly questionable circumstance for the alleged “owner” of the property Hipsz was allegedly buying.

[171] Hipsz testified he didn’t know anything about that failure to pay the mortgage – despite the fact he was the 100% owner of the Bradford Property through First National for the past 5 years.

[172] And then there is the payment of the $16,000. Hipsz says he paid the $16,000 IN CASH to Kassiedass for the First National shares in a Tim Horton’s parking lot.

[173] Hipsz explains his lack of knowledge and involvement in the transaction, on the basis he left everything up to Kassiedass until 2023, even though Hipsz says he learned in 2019 that there was litigation over the sole asset of his alleged company, First National. Yet, with this knowledge in 2019, Hipsz did nothing. Hipsz didn’t know any details about the litigation until 2023. Hipsz didn’t even speak to First National’s lawyer.

[174] When you consider all the above evidence, it screams of a scam or fraudulent transaction. This evidence is simply not believable, and I reject it.

[175] The alleged transfer of First National from Kassiedass to Hipsz appears to be nothing but a fiction designed to avoid the examination of First National, twice ordered by the Court and to try to create another explanation for what happened regarding the purchase by First National.

[176] This is just one further very strong indication of an attempt to cover up a sham or fraudulent transaction, by bringing new “players” into the transaction with no documents and an unbelievable (and rejected) “story”. Bringing in an alleged owner, who has known and done nothing for years, but suddenly appears in 2023, is a recurring theme, as will be seen in just a few moments with 11039.

[177] Faced with this overwhelming strong case of a fraudulent transaction, it makes no sense that First National did not file any responding materials to this motion.

[178] Unfortunately, like a broken record, there is more evidence that adds to the strong prima facie case that the transaction involving First National and 111039 was a sham or fraudulent transaction and not a bona fide purchaser for value without notice.

[179] Turning to 11039, the registered mortgagee on the Bradford Property, the evidence regarding the genesis and creation of the underlying indebtedness of this alleged mortgage is even more baffling and unbelievable than Hipsz’s First National’s share acquisition.

[180] As stated above, D’Mello, the principal of the seller, a lawyer for some of the transactions, the incorporator of 11039, despite a Court Order, has not produced his records for 11039; and not disclosed the names of the past or current shareholders of 11039.

[181] There is no dispute that:

a) 11039 does not even have a bank account; and

b) 11039 has never collected any monies on the $750,000 mortgage – over the past 5 years!

[182] As stated above, 11039 was, according to D’Mello incorporated for Saldana.

[183] Despite being named in this proceeding, Saldana has never appeared nor produced any documents in this proceeding.

[184] Then it was disclosed by the Defendants that Saldana died in 2023. Although, the death certificate produced was for “Saldanah”.

[185] Enter a new person, Annageldi Durdyev (“Durdyev”), a Russian, sometimes living in Turkey but now in Russia.

[186] In 2023, Durdyev alleged he is the owner of 11039.

[187] Durdyev was examined for discovery in December 2023.

[188] Durdyev was questioned about 11039’s mortgage financing for the First National purchase of the Bradford Property.

[189] Durdyev alleges that he “invested” “with Saldana” in real estate and mortgages in 2017 and 2018. Yet, the Bradford Property was sold to First National with the alleged 11039 $750,000 loan in 2019.

[190] Durdyev testified he was the person who invested the $750,000 with Saldana. But where and into what? These are key questions.

[191] Durdyev said at his examination in December 2023:

132. Q. Mr. Durdyev, now we’ve gone to the end. We’ve dealt with, sort of the different ways that you gave money to Mr. Saldana. I want to ask you about when you first started talking to Mr. Saldana, you had various meetings with him, what did he tell you about this investment opportunity?

A. So, he told me that he’s in real estate business, that he’s renting out and everything is related to real estate. And because I did some real estate myself, I knew what it is about and my wife is also in real estate.

So, I knew what he’s talking about and what he offered me is just that he can invest my money and with 8 percent interest. And it was a good deal because it was inflation at the time in Turkey, you couldn’t invest it safely, you could lose everything.

133. Q. So, you understood that he would be investing in the real estate market somehow, is that right?

A. Yes. He told me that he is investing money into the real estate and I will be getting 8 percent every year. And because I understand that business and he explained everything very clearly, so I agreed.

134. Q. Did he explain to you what type of real estate he was investing in? Did he say, “I’m being [sic] property and selling it”, or did he say, “I’m investing in the second mortgages”, or did he say he was investing in rental properties? Did he tell you anything more than just, “We’re investing in real estate and we’ll gave [sic] you 8 percent”?

A. No, he didn’t tell me. He didn’t give me any details. All he told me that at the end of the year, you’ll get your 8 percent. But one document he gave me, this Canada Inc.

135. Q. So, tell me about that. He gave you one document that said Canada Inc.? What are you talking about?

A. This is his business, his company, which is 11039342 if I am not wrong and it is called Canadian Inc. and the company that he was managing, his company.

136. Q. And when did he give you that? Did he give you a document or did he tell you about that company?

A. He provided me with document that stated it is company like this and he’s a director of that company.

137. Q. And did he tell you, you had a role in that company?

A. He told me this is the company that which he will use to manage my money and then he said when I will relocate to Canada, then he will…I will join him with this company.

A. No. I told him that, “I trust you completely. I don’t need percent. Keep the money there because as soon as I come there, we will need this money there. Don’t send me anything”.

185. Q. Sir, are you a shareholder of 11039342 Canada Inc.?

A. I think so because I gave money. And when the lawyer called me and when Eric died, I said, “Okay, I gave money, then you should liquidate the company and make it on my name now if Eric is dead”.

189. Q. Sir, how do you know…is it your understanding that the money you sent to Mr. Saldana ended up in the company 11039342 Canada Inc.?

A. It’s complicated. I am not sure. I didn’t even kno w. My understanding was like they gave money to some investing company. It’s complicated.

190. Q. Well, what is that understanding based on?

A. So, when I was called by the lawyer about what’s going on, it’s something I figured out from our conversations.

191. Q. Okay. I’m going to ask you again. Did anyone ever tell you that the money you gave to Mr. Saldana ended up in any account, any bank account held by 11039342 Canada Inc.?

A. I had no idea. I did not know.

192. Q. So, I take that as no one ever told you your money went into a bank account held by 11039342 Canada?

A. No.

(Emphasis added.)

[192] These admissions would be sufficient to dismiss any suggestion that Durdyev is a shareholder or owner of 11039. Nor does his evidence amount to any proof that Durdyev’s alleged $750,000 went into 11039. Nor does his evidence amount to any proof that 11039 loaned his money for the purchase of the Bradford Property on the security of the mortgage. No proof at all these critical requirements for the validity of the 11039 mortgage.

[193] There are absolutely no documents to support exactly when and how Durdyev “invested” with Saldana. No documents that Durdyev alleged investment monies went to 11039. No documents that Durdyev’s investment monies, even if they had gone to 11039, were advanced by 11039 to First National. No documents that if the monies were advanced to First National, they were used to close the Bradford Property purchase secured by the $750,000 mortgage. None whatsoever.

[194] Based on the above, there is no basis to conclude that Durdyev has an interest in 11039 or that Durdyev’s $750,000 was used for 11039’s to loan First National’s purchase of the Bradford Property.

[195] This is a serious problem for 11039 in this action and in these summary judgment motions.

[196] After failing to produce any evidence in accordance with the Court’s timetables, 11039 filed a late responding affidavit of Durdyev. He was cross-examined on May 2, 3024.

[197] Durdyev admitted the information on what he bases his claim to own 11039 is from his current counsel, Mr. Randhawa. All Durdyev personally knows is that he gave Saldana money to invest:

13. Q. Mr. Durdyev, have you been advised of any information that is in your affidavit from anyone other than Mr. Randhawa?

A. I didn’t quite understanding what you are saying.

14. Q. The details that you have put out in your affidavit, is it based on information that you have received from anyone other than Mr. Randhawa?

A. Yes, it turns out like this. Randhawa was also saying these things when we were discussing this matter.

15. Q. Okay. No one else has told you any information that is set out in your affidavit, is that right?

A. Yes.

26. Q. Okay, and did you understand Eric Saldana was a shareholder of that company?

A. He was handling all these matters, you know, and he was opening his company, setting up his company, and I gave him money, and he told me that, “Your money will be working on your interest”. And he was doing all these things he was handling, and I was trusting him.

27. Q. Okay. The question was simply, did you understand that he was an owner of the company as well?

A. Probably, of course.

(Emphasis added.)

[198] But in re-examination, Durdyev said:

86. Q. The other lawyer had asked you about the shareholders of 11039342 Canada Inc. Do you remember that?

A. Yes, I do. I do remember, yes.

87. Q. To your knowledge, who are the shareholders of 11039342 Canada Inc.?

A. It was before me. Now, I am the only shareholder of this company.

92. Q. Okay. So, Mr. Durdyev, the question was, the money that you had given to Mr. Saldana, was that put into this company, 11039342 Canada Inc.?

A. Yes.

(Emphasis added.)

[199] What Durdyev now alleges is that his investment was, to his knowledge, directed into 11039, even though Durdyev had previously acknowledged in his examination he didn’t know details of where his money went except to Saldana. In his cross examination he became aware of this when advised by his current counsel, Mr. Randhawa and had previously testified to a different and diametrically opposite knowledge.

[200] The troubling part of Durdyev’s answer in the re-examination is that it is not in his affidavit, which actually states:

Para 8 - … Eric told me that he would set up a Canadian company that would invest the money. He informed me that I would be a director of the company. I provided Eric with 500,000 Euros.

[201] Not one of these paragraphs go so far as to say that Durdyev knew or believed he was a shareholder of 11039 when he advanced the monies. Not one of these paragraphs say that Durdyev knew the monies were going into or went into the particular investment – a mortgage in the Bradford Property.

[202] It would have been simple for 11039 to produce the shareholder register. It would have been simple for Durdyev to say he believed he was a 100% shareholder in 11039 when he invested in his affidavit, and he knew his monies were going into a mortgage on the Bradford Property. But he did not testify to this.

[203] I reject Durdyev’s statement in the re-examination. It is simply not credible. Durdyev may have invested monies with Saldana, but Durdyev has no basis in law to say he was the shareholder of 11039 at the time.

[204] I note that 11039 claims that Durdyev is a beneficial owner of 11039, but does not state the legal or factual basis to claim he is now the 100% shareholder of 11039.

[205] I find that Durdyev is simply “piecing together”, with the help of counsel, that 11039 was Saldana’s company, presumably the one that Durdyev’s alleged monies were invested, and since Saldana died, Durdyev now claims to be an owner of 11039. But the evidence of Durdyev simply doesn’t establish what Durdyev now claims to the ownership of 11039 nor that the 11039 loan/mortgage was the final destination of his monies.

[206] If Durdyev’s credibility was not already highly questionable, there is more.

[207] Durdyev testified he met Saldana, in 2017 or 2018. Durdyev testified he last saw Saldana in 2018 or 2019 in Turkey, the day he gave him the money for the “investment”. Durdyev testified that the last time Saldana communicated with him was in 2020. There were no communications at all between 2020 and Saldana’s death at the end of 2023.

[208] Durdyev’s evidence is that he met Saldana, agreed to invest ¾ of a million dollars with him (€500,000 Euros), and that he did nothing, not even speak to the person he gave the amount for the past 3 plus years until Saldana died in November 2023.

[209] Just like Kassiedass and Hipsz, enter Hipsz in 2023 with an unbelievable story alleging he left all the business dealings to Kassiedass, Durdyev enters in 2023 with an unbelievable story alleging he left all the business dealings to Saldana. Kassiedass isn’t here to testify. Saldana is dead (or at least someone with a similar name “Saldanah” died in November 2023). Neither Hipsz nor Durdyev have any documents to show ownership or their financial dealings they claim they were involved in years ago.

[210] Then there is Durdyev’s testimony about how he “invested” the $750,000 (or €500,000 Euros). Durdyev was asked at his examination to explain and provide proof that the $750,000 was actually advanced by him. Like everything else in this case from the Defendants, there are no documents to support this $750,000 investment.

[211] Durdyev testified he had papers to prove this investment, but they are lost. Its an unbelievable story.

[212] This is the way Durdyev described his “investment” of $750,000 with Saldana:

a) Durdyev states that he met Saldana, at an Irish pub, in Turkey in 2017 or 2018. There was a discussion of an investment in real estate in Canada. Durdyev agreed to invest with Saldana.

b) In or about 2018, Durdyev, while in Turkey, gave Saldana €500,000 Euros in two tranches.

c) The first €150,000 Euros was brought to Turkey from Russia by Durdyev, who claims he had €150,000 Euros in cash at his house. Durdyev claims to have taken the cash from Russia and deposited it into an account in Turkey at which time he took the cash out of the account and gave it to Saldana. Durdyev claims that Saldana provided him with a receipt but that is not available. The bank statements from the bank in Turkey are also not available. There are no documents regarding the source or eventual disposition of the €150,000 Euros. There are no documents as to what, if anything, Saldana did with the €150,000 Euros.

d) With respect to the remaining €350,000 Euros, Durdyev claims that he withdrew Euros from several different bank accounts that he had in Turkey until he had €350,000 Euros. That banking documentation is not available. Saldana took Durdyev to a German bank where he opened a ‘one transaction account’ and was directed by Saldana to have the money wired to another bank. That banking documentation is not available. Saldana has produced no such records either. Again, there are no source or distribution records for the €350,000 Euros. Or even whether Saldana invested the monies in the Bradford Property or elsewhere.

e) After allegedly giving Saldana €500,000 Euros in about 2018, Durdyev never again met with Saldana and only received one call from Saldana in 2020.

[213] These undocumented cash and clandestine payments in a foreign company, the manner which Durdyev failed to deal with his allegedly invested funds with Saldana for years, is a significant indication of a sham or fraudulent transaction.

[214] These undocumented cash and clandestine payments in a foreign country, for 11039 to have a valid mortgage, there would have been some evidence that:

a) Durdyev advanced $750,000 to 11039, AND

b) $750,000 was advanced by 11039 for First National’s purchase price of the Bradford Property; AND

c) $750,000 was paid by First National (or directed) to D’Mello’s company, the vendor, for the purchase price of the Bradford Property; AND

d) $750,000 advance was to be secured against the Bradford Property.

[215] There is no evidence of any of this.

Conclusion on First National’s Ownership

[216] For the above reasons, the Plaintiff has provided very strong or prima facie case of fraud that the sale of the Bradford Property to First National was of a sham or fraudulent transaction.

[217] There is no proof that First National’s purchase was for value.

[218] What has First National done to provide any evidence that is consistent with First National’s purchase of the Bradford Property being a bona fide purchase transaction for value without notice? Nothing.

[219] I am satisfied that the Plaintiff has met its onus on this motion that judgment should issue in favour of the Plaintiff.

[220] Given all the above evidence and findings of fact and the lack of evidence from by First National, Kassiedass, Hipsz and D’Mello, the only conclusion to be drawn and which I do find is that the sale transaction from 97061 to First National was a sham, fraudulent or non-existent transaction and no trial is required to come to this final and just determination.

[221] Accordingly, an order will issue that First National’s registered ownership be expunged from the Registry, a declaration that First National has no interest in the Bradford Property and the Registrar of Land Titles be directed to register the Plaintiff as the owner of the Bradford Property.

Conclusion on 11039’s Mortgage

[222] For the reasons set out above, the Plaintiff has established very strong prima facie case of fraud that the 11039 mortgage is a sham or fraudulent transaction, namely that the 11039 mortgage was not a bona fide mortgage.

[223] There is no proof that 11039’s mortgage was for value in connection with the First National purchase and loan to close the purchase.

[224] What evidence has 11039 provided that 11039 advanced the $750,000 monies to First National for the purchase of the Bradford Property secured by the 11039 mortgage? Nothing, except one statement by Durdyev, in re-examination, which statement is rejected for the reasons set out above.

[225] I am satisfied that the Plaintiff has met its onus on this motion that judgment should issue in favour of the Plaintiff.

[226] As a result, given all the above evidence, findings of fact and badges of fraud and in particular the lack of evidence produced by First National, 11039, Durdyev and D’Mello, the only conclusion to be drawn and that I do find, is that the 11039 mortgage transaction is a sham, fraudulent or non-existent transaction and no trial is required to come to this final and just determination.

[227] 11039’s mortgage is hereby declared to be void and the Registrar of Land Title is to be directed to discharge 11039’s mortgage from title on the Bradford Property.

The Caledon Property

[228] This summary judgment motion is for:

a) A declaration that the mortgage registered as Instrument Number PR3286334 on the Caledon Property in favour of Canguard Group Limited (the “Canguard”) is a fraudulent conveyance and is void.

b) An Order vacating the Order for possession of the Caledon Property in favour of Canguard in Court File CV-19000000090-00 and granting possession of the Caledon Property to the Plaintiff; and

c) An Order that the Land Registry office discharge the Canguard Mortgage from the title of the Caledon Property.

The Defences

[229] Canguard’s Statement of Defence alleges that:

a) It is a corporation registered in Seychelles; and

b) It advanced monies to Bangia but its pleading sets out no details as to the amount or when of the financial transaction leading to its mortgage.

c) Canguard’s Statement of Defence simply contains numerous denials, but no material facts to support its allegations.

[230] Canguard’s position is that this issue requires a trial.

Current Ownership of the Caledon Property

[231] At issue, in these proceedings, is the real property located at 11 Royal Terrace Crescent, Bolton, Ontario (“the Caledon Property”).

[232] Canguard currently has a registered mortgage on the Caledon Property.

[233] The previous owner was Bangia who purported to acquire title to the Caledon Property under power of sale by D’Mello (97061) in February 2018.

[234] The Plaintiff alleged that Bangia was not a bona fide purchaser for value without notice. After years of Bangia’s failure to appear and/or participate in these proceedings, an order issued striking Bangia’s pleadings and judgment was granted removing Bangia as the registered owner of the Caledon Property and the Registrar of Land Titles was directed to register the Plaintiff as the registered owner. See endorsement and Judgment dated September 15, 2023. Bangia’s interest in the Caledon Property has been extinguished.

[235] D’Mello acknowledges to this Court that he, and his companies, have no current interest in the Caledon Property.

Evidence and Analysis

[236] As set out above, D’Mello (96170) sold the Caledon Property to Bangia, one day after listing it, on January 19, 2018, for $440,000 (although there was originally a signed Agreement of Purchase and Sale for $350,000).

[237] Canguard registered its mortgage on the Caledon Lands on February 21, 2018, for $400,000.

[238] Bangia has NEVER appeared, despite three attempts, including a Court Order, to attend examinations for discovery.

[239] Bangia has NEVER produced relevant documents, particularly those relating to the acquisition and financial transactions for the Caledon Property, nor its dealings with the Caledon Property after it became the registered owner of the Caledon Property.

[240] A CPL was granted on April 26, 2018, and registered on title against the Caledon Property. The CPL remains there today.

[241] An affidavit of Documents was requested from Canguard. None has been provided.

[242] No responding record has been delivered by Canguard.

[243] No documents have been produced by Canguard. This is an indication that Canguard’s mortgage is a sham or fraudulent mortgage.

[244] Despite this being a substantial mortgage transaction, there is NOT A SINGLE DOCUMENT signed by Canguard. This is an indication Canguard’s mortgage is a sham or fraudulent mortgage.

[245] Canguard was NOT a corporation at the time it registered a mortgage - it was incorporated 9 days after the mortgage commitment. This too is an indication Canguard’s mortgage is a sham or fraudulent mortgage.

[246] Canguard is NOT a Canadian nor an Ontario corporation. It is a company incorporated in the Seychelles. When asked for details of Seychell’s corporate registration, nothing was forthcoming from Canguard’s counsel.

[247] Canguard, as a foreign corporation with an office at the time in Ontario, was required to but was NOT registered to conduct any business in Ontario. At the relevant time, Canguard stated it had an office in Ontario (10 Four Seasons Place, Suite 1000, Toronto – an office rental location) at the time of the mortgage. See s. 4(2) of the Extra Provincial Corporations Act and Canguard’s mortgage registration.

[248] There is no corporate report nor corporate information for Canguard in Canadian corporation registry systems. Exactly who its shareholders, officers and directors are, is not known.

[249] All the above raises a very serious question as to the existence of Canguard and, hence, an indication that the Canguard mortgage transaction was a sham or fraudulent mortgage.

[250] Most importantly, there is NO evidence of any advance of monies by Canguard to Bangia for this purchase (or proof the monies were actually advanced to the vendor for the closing) for the mortgage security it registered against the Caledon Property.

[251] There are several lawyer’s statements of adjustments/reporting letters allegedly showing monies regarding this transaction. However, despite repeated requests for the source and distribution documents (where the monies came from and where they went), none have been forthcoming from Bangia or D’Mello (who was involved in the transaction). This failure goes to the very heart of the bona fides of Canguard’s mortgage.

[252] Even the trail of monies according to the lawyer’s statements, the money ended up with D’Mello, albeit in trust. Since D’Mello has ignored Court Orders to produce documents related to the transactions in which he was involved, including this sale and mortgage, neither Bangia, Canguard nor D’Mello have shown any evidence that Canguard advanced any monies AND that any such monies were used to complete the purchase of the Caledon Property.

[253] Bangia hadn’t made a single payment on Canguard’s mortgage from the inception. No mortgage payment has been made for the past 6 years! This is a strong indication that the Canguard Mortgage is a sham or fraudulent mortgage.

[254] What has Canguard done?

[255] What was recently discovered by the Plaintiff is that Canguard commenced an action on January 9, 2019, claiming $723,860.22 under the mortgage. That is correct, Canguard claimed its mortgage had gone from $400,000 to $723,860.22 in less than nine months – almost doubled in the amount allegedly owing! Again, there is no financial documentation supporting the basis for this substantial increase nor any review of the propriety of the amount claimed in the action as owing under the Canguard mortgage, as the action was undefended by Bangia, and judgment issued against Bangia in favour of Canguard on February 28, 2019.

[256] What has Canguard done with its judgment? There is no evidence that Canguard has done anything with its judgment since then. Again, circumstances indicative of a sham or fraudulent mortgage.

[257] According to the allegations in its pleading, Canguard took possession of the Caledon Property by 2018. Yet, there were tax arrears since 2017 (even prior to the Canguard Mortgage going on title) and the taxes were never paid until 2023. But there is evidence from the municipality that the Caledon Property was abandoned at since at least 2020. This is an indication that Canguard has not interest in preserving or protecting its mortgage security interest in the Caledon Property. Hence a further indication of a sham or fraudulent mortgage.

[258] What has Canguard done since the CPL was obtained and registered on the Caledon Property approximately 6 years ago? Nothing. One would expect the mortgagee to want to expedite this proceeding so that it could deal with its mortgage security. But, Canguard has done nothing.

[259] And at these motions, Canguard did not file responding materials.

[260] Canguard has not:

a) Served an Affidavit of Documents.

b) Served a Responding Record to this motion; nor

c) Sought nor conducted any cross-examination of the Plaintiff or any other person or party.

Conclusion on Canguard’s Mortgage

[261] Canguard has NO evidence before this Court. Just its pleading.

[262] Canguard’s sole position is that the Plaintiff has not established, for the purpose of a summary judgment motion, that the sale transaction to Bangia or Canguard’s mortgage was fraudulent. It requires a trial.

[263] Canguard also relies in its submissions on a Limitations defence, submitting that the Plaintiff knew (or should have known) about the Canguard Mortgage since 2019. However, the Limitations Act defence was NOT pleaded by Canguard.

[264] The onus is on the moving party to show that there is no genuine issue requiring a trial.

[265] A responding party must “lead trump or risk losing”. A responding party may not rest on the allegations or denials in the pleadings. Allegations are not evidence.

[266] The motion judge is entitled to assume that the evidentiary record contains all evidence that the parties will present if there is a trial: Paradise Homes North West Inc. v. Sidhu, 2019 ONSC 1600, at paragraph 16.

[267] As stated above, where the moving party puts forward a very strong prima facie case of a sham or fraudulent transaction, as in this case, the responding party must present by way of affidavit or other evidence, specific facts, and coherent organized evidence to raise a genuine issue requiring a trial.

[268] Here the Plaintiff has done just that – relied on its pleading. Canguard didn’t even produce an Affidavit of Documents in this proceeding let alone be examined for discovery. Canguard’s failure to do so, along with its failure to provide ANY responding materials, is fatal to Canguard’s submissions that the validity of its mortgage raises a genuine issue requiring a trial as there is no evidence that Canguard exists or has ever advanced any monies with respect to this transaction.

[269] On the other hand, the Plaintiff has established numerous clear and overwhelming indicia, that Canguard’s mortgage was a sham or fraudulent mortgage.

[270] Canguard has led no evidence to even rebut the Plaintiffs evidence which would suggest that its mortgage was a bona fide transaction.

[271] Canguard submits its judgment against Bangia is evidence of a loan or advance. I am not persuaded that Canguard’s judgment is “evidence”. First, that is a matter between Canguard and Bangia. The Plaintiff is NOT bound by that determination. Having an undefended judgment from a purchaser/owner who did not appear or defend that action or this proceeding (particularly where the purchaser is deemed to have admitted in this case that its purchase was a sham or fraudulent transaction), is not evidence and establishes nothing.

[272] The Plaintiff has met its onus.

[273] I am satisfied that, given the evidence before this Court and the above reasons, there is no genuine issue requiring a trial that the Canguard Mortgage is a sham or fraudulent.

[274] In these circumstances and given this conclusion, the provisions of the Mortgages Act nor the Land Titles Act, assist Canguard in preserving the validity of its alleged mortgage.

[275] I declare the Canguard mortgage to be void and direct the Registrar of Land Titles expunge the Canguard Mortgage from the register to the Caledon Property.

Conclusion

[276] The Canguard Mortgage on the Caledon Property is void and of no effect.

[277] The transfer of the Bradford Property to First National is void and of no effect.

[278] 11039’s mortgage on the Bradford Property is void and of no effect.

[279] The Registrar of the Land Titles Office shall be directed accordingly.

Costs

[280] The Plaintiff shall deliver written cost submissions within 3 weeks of the release date of these reasons. A Bill of Costs is to be included broken down into the two summary judgment motions.

[281] First National, 11039 and Canguard shall have a further 3 weeks (upon receipt of the Plaintiff’s cost submissions) to provide written cost submissions. Each party shall include their own Cost Outline.

[282] There will be no reply submissions.

RSJ L. Ricchetti

Released: July 22, 2024

COURT FILE NO.: CV-18-00001310-0000; CV-19-00003118-0000; CV-19-00003248-0000; CV-22-00002425-0000; CV-23-00002454-0000 DATE: 2024 07 22 SUPERIOR COURT OF JUSTICE - ONTARIO RE: SAPUSAK, Chris Jamie, the Plaintiff -and- 9706151 CANADA LTD., Defendant D’MELLO, Roy, Defendant 11037315 CANADA INC., Defendant 1152729 B.C. LTD.., Defendant BANGIA PROPERTY SERVICES LTD., Defendant APEX FINANCIAL CORP., Defendant, and 1824231 ONTARIO INC., Defendant COUNSEL: N. Colville-Reeves, Counsel for the Plaintiff, Chris Jamie Sapusak; R. D’Mello, Self-Represented, Defendant; K. RANDHAWA, Counsel for the Defendant, 11039342 Canada Inc.; A. FARLEY, Counsel for Non- Party, Harcharan Kaur; and G. CADOGAN, Counsel for Non- Party, Canguard Group Limited REASONS FOR JUDGEMENT RSJ L. RICCHETTI Released: July 22, 2024