Supreme Court
Decision Information
Abstract: Application by Defendant for dismissal of Plaintiff=s action under Rule 129 - Application by Plaintiff for Order directing payment of $16,237.73 into court to credit of the action and directing release of balance of proceeds of sale of Yellowknife property to Plaintiff company - Plaintiff seeking by statement of claim a declaration that property held in trust by defendant for plaintiff and an Order directing payment of proceeds from sale of property from defendant to plaintiff - Court considering Defendant's application to dismiss action - counsel for defendant arguing that if trust relationship exists it is fradulent or illegal - Court finding that law well settled that plaintiff should not lightly be deprived of right to have cause tried, and a statement of claim should be struck out only in clearest and most obvious cases - Court considering Plaintiff's application - Counsel for defendant arguing that one issue for court is whether a joint tenancy exists - Court finding that issue of possible joint tenancy not appropriate for consideration in an interlocutory proceeding,
Decision: Applications dismissed with costs.
Subjects: Civil procedure
Keywords: Dismissal
Direction for payment into court
Grounds
Evidence
Decision Content
I IN THE SUPREME COURT OF THE NORTHWEST TERRITORIES B E T W E E N : YELLOWKNIFE PUBLISHING COMPANY LTD. AND: JANIS E. ALEXANDER
A p p l i c a t i o n by t h e d e f e n d a n t f o r d i s m i s s a l o f t he P l a i n t i f f ' s I a c t i o n p u r s u a n t t o R u l e l 2 9 . A p p l i c a t i o n d i s m i s s e d w i t h c o s t s . A p p l i c a t i o n by t h e p l a i n t i f f f o r an o r d e r d i r e c t i n g payment i n t o cour t to the c r e d i t o f t h e w i t h i n a c t i o n o f the sum o f $ 1 6 , 2 3 7 . 7 3 and d i i - e c t i n g t h e r e l e a s e o f t h e b a l a n c e o f the p roceeds o f t he sale o f Lo t 4 , B l o c k 8 7 , Y e l l o w k n i f e to the p l a i n t i f f company. A p p l i c a t i o n d i s m i s s e d w i t h c o s t s . Heard a t Y e l l o w k n i f e May 1 7 t h , 1978 . Reasons f o r Judgment f i l e d : Reasons f o r Judgment b y : The Honourable Mr. Justice C.F. Tallis Counsel on the H e a r i n g I Mr. J. Edward Richard for the Plaintiff Mr. Graham Price for the Defendant
I N THE SUPREME COURT OF THE NORTHWEST T E R R I T O R I E S ft B E T W E E N : YELLOWKNIFE PUBLISHING COMPANY LTD, PLAINTIFF AND JANIS E. ALEXANDER DEFENDANT REASONS FOR JUDGMENT OF THE HONOURABLE MR. JUSTICE C. F. TALLIS The p l a i n t i f f , b y i t s s t a t e m e n t o f c l a i m da ted t h e ) 17th day o f F e b r u a r y , A . D . 1 9 7 8 , s e e k s , i r t e r a l i a , a d e c l a r a t i o n t h a t A. C o l i n A l e x a n d e r and the d e f e n d a n t Jan i s E. A l e x a n d e r he ld c e r t a i n p r e m i s e s known as Lo t 4 , B lock 8 7 , Y e l l o w k n i f e in t r u s t f o r t h e p l a i n t i f f . The a l l e g a t i o n s s e t f o r t h i n the p l a i n t i f f ' s s t a t e m e n t of c l a i m are as f o l l o w s : "1 . The Plaintiff is a body corporate incorporated pursuant to the laws of the Northwest Territories with an office at the City of Yellowknife, in the Northwest Te rri to ri es . 2 . The Defendant, so far as is known to the Plaintiff, resides at Baker Lake in the Northwest Territories. 3. On or about the 14th day of June, 1974, the Plaintiff ) purchased property in the City of Yellowknife, in the Northwest Territories, known as Lot 4, Block 87, (the Premises), at and for a purchase price of $29,800.00.
- 2 t "4. In order to finance the purchase of the premises, and improvements to the premises, the Plaintiff applied for a loan from Central Mortgage and Housing Corporation (CMHC) in the amount of $35,000.00, but was advised by CMHC that application for such loan could only be made by a registered owner of property who was an individual person, rather than a corporation.
5. In order to facilitate the application for a CMHC loan, on or about the 10th day of October, 197^, the Plaintiff therefore transferred the title for the premises into the names of A. Colin Alexander and the Defendant, JanisE.Alexander.
6. At the time of the transfer referred to in the preceding paragraph, A. Colin Alexander was the principal shareholder, a director and the President of the Company, and the Defendant was a director and Secretary of the Company.
7. No monies or other consideration were paid or given to the Plaintiff Company by A. Colin Alexander or the Defendant for the transfer of the premises.
8. The Plaintiff company received the entire proceeds t from the mortgage loan granted by Ci-IHC. 9. The Plaintiff company paid the entire purchase price of $29,800.00, referred to in paragraph 3, and none of the said purchase price was paid by A. Colin Alexander or the Defendant.
10. The Plaintiff Cofiipany has paid each and every of the payments due and owing to CMHC under the mortgage loan agreement, and none of the said payments have been made by A. Colin Alexander or the Defendant.
11. The Plaintiff Company has collected and received on its own behalf rental payments as a result of the rental of the said premises, and none of the said rental payments have been collected or received by or on behalf of A. Colin Alexander or the Defendant.
12. It was the intention of the parties that A. Colin Alexander and the Defendant would hold the said premises in trust for the Plaintiff company.
13. From the said 10th day of October, 1974, A. Colin Alexander and the Defendant were trustees holding the said premises in trust for ti-ie Plaintiff Company, the beneficial owner of the said premises, and continue to so hold the said premises in trust for the Plaintiff company.
3 -> "14. In the alternative, the Plaintiff says that the Defendant would be unjustly enriched if she were permitted to retain title to the said premises, or to retain or receive on her own behalf any proceeds from the sale of the said premises.
15. On or about the 9th day of September, 1977, the Plaintiff company agreed to sell the said premises to Robert 0. Baetz and Margreta G. Baetz, (the Purchasers), at and for a purchase price of $88,000.00. The agreement provided for a possession and closing date of December 30th, 1977.
16. On or about the 9th day of December, 1977 the Plaintiff Company called upon the said A. Colin Alexander and the Defendant to sign a transfer of the said Premises to the Purchasers.
17, The s a i d A. C o l i n A l e x a n d e r s i g n e d t h e s a i d t r a n s f e r 18. Initially the Defendant refused to sign the said transfer; and on or about the 31st day of January, 1978, the Defendant provided a signed transfer to the Plaintiff with the stipulation that the said proceeds be held in trust pending settlement of the dispute between
) the Plaintiff company and the Defendant. 19. As a result of,the original refusal, and the subsequent signing of the transfer upon conditions, the Plaintiff company has suffered damage, particulars of which are as follows:
(a) An unascertained amount of potential damages payable by the Plaintiff to the Purchasers, referred to in paragraph 15 for failure to perform the said transaction.
(b) Interest on the sale proceeds from December 30th, 1977.
(c) An unascertained amount of damage as a direct rtjsuit of the Plaintiff company not having the sale proceeds available for reinvestment in other company projects.
20, The Plaintiff proposes the trial of this action be held at the City of Yellowknife, in the Northwest Territories WHEREFORE THE PLAINTIFF CLAIMS AGAINST THE DEFENDANT: (a) A decla)^ation that A. Colin Alexander and the Defendant, Janis E. Alexander held the premises in 1
trust for the P l a i n t i f f ; t (b) an Order directing the payment of the sale proceeds to the Plaintiff company. (c) General damages. (d) Costs."
A s t a t e m e n t o f d e f e n c e has been f i l e d i n the w i t h i n a c t i o n Paragraphs 3-5 t h e r e o f a re as f o l l o w s : " 3 . The D e f e n d a n t st tes that she held, at all material times h e r e t o . itle to the property referred to in paragraph three the Statement of Claim herein as joint tenant for h wn use and ben e f i t . 4. The D e f e n d a n t fu .'^er states that consideration was given by the Defen , nt by the Plaintiff on the execution by the Defen,:,int of a personal covenant to pay in favour of Central M o r t g a g e and Housing Corpo>"ation and upon delivery of the loan proceeds referred to in paragraph eight of the Sta t e m e n t of Claim herein by the Defendant to the P l a i n t i f f .
\ 5. In the a l t e r n a t i v e , if the Defendant does not hold title to her o\-;n use and b e n e f i t , \-/hich is not a d m i 11 e d but expi^essly deriied, the Defendant states that the agreement and trust relationship pleaded by the Plainti ff in the Statemetit of Claim herein is illegal and i s contrary to public pol i c y , as is disclosed by the facts alleged in the S t a t e m e n t of Claim h e r e i n , and specifically paragraplis four and five t h e r e o f , and the Defendant states that the P l a i n t i f f is estopped from relying upon the arr a n g e m e n t and trust r e l a t i o n s h i p alleged in the St a t e m e n t of Claim h e r e i n . "
The p l a i n t i f f has applied by notice of motion for the fol1owi ng relief: (a) An order directing payment "into Court to the^ credit of the within action the sum of $ 1 6 , 2 3 7 . 7 3 , being o n e - h a l f of the proceeds of the sale of property known as Lot 4 , Block 8 7 , City of Y e l l o w k n i f e , such property being the subject matter of the within a c t i o n , and"
(b) An o r d e r d i r e c t i n g "the release of the balance of the said p r o c e e d s to the P l a i n t i f f Company." J
- 5 > In support of this application the pi aintiff fi1ed the
affidavit of Colin Alexander which reads as follows: ' 1 . THAT I am t h e P i ^ e s i d e n t o f C0 111p a ny L t d . t h e P l a i n t i f f such have p e r s o n a l know ledge to save where s t a t e d to be on i n f o r m a t i o n FHAT^the P I a i n t i f f N 0 r t h w "" e '' s t '^ T e î • r • ' i t o • r- i o s ' n 0 z n as L o t 4 , 1974 f o r a p u r c h a s e p r i c e 2A. r U A T b e t w e e n June 1 4 , 1974 and O c t o b e r the P l a i n t i f f Company made i nip ro vemen t s o f a v a l u e o f a p p r o x i m a t e l y Company p a i d f o r t hese i m p r o v e m e n t s . 3. THAT on o r abou t O c t o b e r P l a i n t i f f Company t r a n s f e r r e d I and my w i f e , J a n i s E. A l e x a n d e r , w i t h i n a c t i o n , t o be lie I d by t h e i n t r u s t f o r the Company, s u b j e c t and c o n d i t i o n s . 4 . THAT f r o m and a f t e r u n d e r s t o o d and a g r e e d t h a t be r e s p o n s i b l e f o r a l l mo r tgage payments p r e m i s e s , and a l l o t h e r payments s a i d pr,- ]mises f o r u t i l i t i e s , P l a i n t i f f Co;:ipany \ / o u l d r e c e i v e r e n t a l re ven ues f rom the s a i d pi emi ses . THAT i n f a c t t he P l a i n t i f f p u r c !i a s e p r i c e f o r t he s a i d p r e m i s e s , r,i 0)" t g a g e paymen ts and u t i l i t y on i t s ov/n b e h a l f and f o r t o d a t e . 6 . THAT a t t h e t i m e the P l a i n t i . f f t h e s a i d p r e m i s e s i n t r u s t Def ei-idan t ' was a D i r e c t o r Company, and s i g n e d t h e t r a n s f e r o f t he Company. 7. THAT a t t h e t i m e the P l a i n t i f f t h e s a i d p r e m i s e s i n t r u s t no mon ies o r o t h e r c o n s i d e r a t i o n we)-e p a i d o r P l a i n t i f f Coinpany by t h e ^
Y e l l o w k n i f e P u b l i s h i n g i n t he w i t h i n a c t i o n , and as o f t h e m a t t e r s f i e r e i n deposed and b e l i e f p u r c h a s e d p r o p e r t y i n Y e l l o w k n i f e , B l o c k 8 7 , on June 1 4 , o f $ 2 9 , 0 0 0 . 0 0 . 1 0 , 1 9 7 4 , to the s a i d p r e m i s e s $ 3 0 , 0 0 0 . 0 0 and the P l a i n t i f f 1 0 t h , 1 9 7 4 , t h e the p r e m i s e s t o m y s e l f t h e D e f e n d a n t i n t h e D e f e n d a n t and m y s e l f t o c e r t a i n terms O c t o b e r 1 0 , 1 9 7 4 , i t was t i i e P l a i n t i f f Coi.Tpany wou ld f o r the s a i d i n c o n n e c t i o n w i t h the e t c . and a l s o , t h a t the I 0 r 1 L s 0 \.' n b e n e f i t a l l Coinpany lias p a i d t he end p a i d a l l pay 1 e n t s , a ti d has i- e c e i v e d i t s own b e n e f i t , a l l revenue Ccinpany t r a n s f e r r e d to t h e D e f e n d a n t and m y s e l f , the and S e c r e t a r y o f the P l a i n t i f f document as an o f f i c e r Company t r a n s f e r r e d to t h e D e f e n d a n t and m y s e l f , g i v e n t o t he D e f e n d a n t o r m y s e l f .
- 6 -7A. THAT f r o m t h e 1 4 t h p r o m i s e s have been sl iown on t h e r e c o r d s o f t h e Coinpany as an a s s e t o f > 8 . THAT on o r a b o u t t h e t h e P l a i n t i f f Coinpany a g r e e d R o b e r t 0 . B a e t z and M a r g r e t a p r i c e ' o f $ 8 8 , 0 0 0 . 0 0 , w i t h c l o s i n g d a t e o f December 9 . THAT I am a d v i s e d by t ! ie P l a i n t i f f ' s J . Edward R i c h a r d , and v e r i l y t o t h e D e f e n d a n t a t r a n s f e r he r t r a n s f e r r i n g t h e s a i d 10 . THAT I am f u r t l i e r a d v i s e d by Mr. v e r i l y b e l i e v e , t h a t on o r a b o u t i - e c e i v e d a t e l e p h o n e c a l l D e f e n d a n t ' s S a s k a t o o n l a w y e r , Mr. S i n g e r t h a t t h e D e f e n d a n t t r a n s f e r .
\ 12 . THAT I am a d v i s e d by Mr. t h a t on o r a b o u t J a n u a r y D e f e n d a n t ' s S o l i c i t o r a s i g n e d was d e l i v e r e d t o Mr . R i c h a r d P l a i n t i f f Coinpany upon c e r t a i n the n e t p r o c e e d s From t h e be i-el e a s e d w i t l i o u t ( a ) W r i t t e n A l e x a n d e r , o r ( b ) an O r d e r 13 . THAT a t t a c h e d i i e r e t o t h i s !,iy A f f i d a v i t i s a n ! - i o t o s t a t r e c e i v e d by Mr . R i c h a r d v.'hich l e t t e r c o n d i t i o n s s e t o u t by t h e 14 . THAT I am a d v i s e d by Mr. t h a t t h e s a l e t o Mr . and M r s . a b o u t F e b r u a r y 1 5 , 1 9 7 8 , n e t 0 r 0 c e e d s o f $ 3 2 , 4 7 5 . 4 5 to t h e c o n d i t i o n s i m p o s e d by h i s l e t t e r a t t a d i e d as E x h i b i t 15 . THAT on o r a b o u t F e b r u a r y Company e n t e r e d i n t o an a g r e e m e n t w i t h L t d ' , t o s e l l a s u b s t a n t i a l b u s i n e s s o p e r a t i o n s i n t h e t o t a l p u r c h a s e p r i c e o f $ 2 6 5 , 0 0 0 . 0 0 .
day o f J u n e , 1 9 7 4 , t h e s a i d f i n a n c i a l s t a t e m e n t s and t l i e Company. 9 t h day o f S e p t e m b e r , 19 7 7 , t o s e l l t h e s a i d p r e m i s e s to G. Bae tz a t and f o r a p u r c h a s e a s c h e d u l e d p o s s e s s i o n and 3 0 , 1977. s o l i c i t o r , b e l i e v e , t h a t he f o r w a r d e d document t o be s i g n e d by p r e m i s e s t o Mr. and M r s . B a e t z . R i c h a r d , and December 2 2 , 1 9 7 7 , he f r o m Mr. B a r r y S i n g e r , t h e and was a d v i s e d by thie s a i d r e f u s e d t o s i g n t h e s a i d
R icha i -d and v e r i l y b e l i e v e , 3 1 , 1 9 7 8 , he r e c e i v e d fi^om t h e T r a n s f e r o f L a n d , w h i c h as s o l i c i t o r f o r t h e t r u s t c o n d i t i o n s , i . e . , c l i a t s a l e be h e l d i n t r u s t "ar. d n o t p e r m i s s i o n f r o m Jai- i is o f an appi^opi ' i a t e C o u r t . " and marked as E x h i b i t "A " t o copy o f t he l e t t e r c o n t a i n s t h e t r u s t D e f e n d a n t ' s s o l i c i t o r . R i c h a r d and v e r i l y b e l i e v e , Bae tz was c o n c l u d e d on o r and t h a t s i n c e t h a t d a t e t h e have been h e l d i n t r u s t p u r s u a n t the D e f e n d a n t ' s s o l i c i t o r i n "A" t o t h i s my A f f i d a v i t . 7 , 1 9 7 8 , t h e P l a i n t i f f C a n a r c t i c G r a p h i c s p o t a t i o n o f i t s a s s e t s and i t s C i t y o f Y e l l o w k n i f e f o r a
7 -^ ^ ' . M n l ' ^ ^ L ' ' ^ ^ ^^^"^ ag reemen t o f $ 0 0 , 0 0 0 . 0 0 and the b a l a n c e » t o t h e P l a i n t i f f Coinpany o v e r 1 7 . IHAT the s a i d b u s i n e s s t o C a n a r c t i c G r a p h i c s L t d . t o t h e s a i d a g r e e m e n t . 18, THAT the down payment G r a p h i c s L t d . we re used by t h e p r i o r encumbrances and t o pay t fdde by t h e p r o v i s i o n s o f the 19 T H A T t h e P l a i n t i f f C o m p a n y is in t h e p r o c e s s o f c o m m e n c i n g a n e w b u s i n e s s v e n t u r e in the C i t y o f O t t a w a , in t h e P r o v i n c e of O n t a r i o , n a m e l y t h e e s t a b l i s h m e n t o f a w e e k l y n e w s p a p e r in t h a t C i t y .
2 0 . T H A T t h e P I a i n t i ff Coinpany u r g e n t l y r e q u i r e s f u n d s t o e n a b l e it to c o m m e n c e t h i s n e w b u s i n e s s v e n t u r e .
2 1 . THAT by i^eason o f t h e and 17 a b o v e , t h e P l a i n t i f f n e t p i ' o c c e d s f rom t ' le s a l e i n Y e l l o w k n i f e f o r r e i n v e s t m e n t o p e r a t i o n s i n the C i t y o f ) 2 2 . THAT I v e r i l y b e l i e v e V,' i 1 1 be u n a b l e t o cdj t a i n n c w f i n a n c i n g i n an adequa te nniount f o r i t s new b u s i n e s s O n t a r i o , w i t h o u t the i n p u t Company 's own f u n d s , as t h i s c o n v e n t i o n a l r e q u i r e m e n t o f befoi~e a p p r o v i n g a l o a n t o a b o r r o w e r P1c i n t i f f Company. 2 3 . FHAT because o f t h e re^errzd t o i n paragi^aph 15 above '.-.'as i n s u f f i c i e n t s a t i s f y a l l p i ^ i o r encun/o )^an ces P l a i i i t i f f Company was i ^ e q u i r e d the C a n a d i a n I m p e r i a l Bank o f s a t i s f y i t s i n d e b t e d n e s s 2 4 . IW'J s i n c e a p p r 0 X i m a t e 1 y 19 7 6 , t h e De fend i n t zn d my s e l f and a p a r t . 2 5 . THAT on o r abou t Februai^y and m y s e l f s i g n e d a S e p a r a t i o n ,' i n te_r _aXiA• '"''^'" d i s t r i b u t i o n i7 id -for s e t t l e m e n t o f a l l a 1 i 1,! 0 n y .
2 6 . T H A T a t t a c h e d h e r e t o a n d m a r k e d as E x h i b i t "B' to t h i s m y A f f i d a v i t is a p h o t o s t a t c o p y o f t h e S e p a r a t i o n A g r e e m e n t referred to in t h e i m m e d i a t e l y p r e c e d i n q p a r a g r a p h . ^
p r o v i d e d f o r a down payment o f $ 1 6 5 , 0 0 0 . 0 0 to be p a i d ten y e a r s . o p e r a t i o n s were t u r n e d o v e r on A p r i l 1 7 , 1 9 7 8 , p u r s u a n t r e c e i v e d f r o m C a n a r c t i c P l a i n t i f f to d i s c h a r g e c r c d i t o r s , as r e q u i )• o d a i d a g re erne n t
f a c t s a l l e g e d i n p a r a g r a p h s 15 Company d i d n o t r e c e i v e any o f i t s b u s i n e s s o p e r a t i o n s i n i t s new b u s i n e s s O t t a w a . t h a t t ' l e P l a i n t i f f Company o p e r a t i o n s i n O t t a w a , o f some o f t ii e P1 a i ii t i f f i s a s t a n d a r d and f i n a n c i a l i n s t i t u t i o n s such as the f a c t t l i a t t h e dov.'n payment to and t r a d e c i ^ e d i t o r s , the to o b t a i n a l o a n fi~om CoiVii-ie r ce , Y e l l o w k n i f e to to i t s t r a d e c r e d i t o r s . month o f S e p t e m b e r , been l i v i n g s e p a r a t e 1 9 7 7 , t h e De fendan t ! eemen t p î o v i d i n g , o f t , e ma t i M ' m e n i a l p r o p e r t y c l a i m s f o r m a i n t e n a n c e and f o r
• 2 7 . THAT I have i n f a c t D e f e n d a n t i n t h e amount and on the d a t e s i n p a r a g r a p h 13 o f the s a i d S e p a r a t i o n 2 8 . THAT I have r e a d t h e S t a t e m e n t h e r e i n on b e h a l f o f t he P l a i n t i f f a d v i s e d by t h e P l a i n t i f f ' s and v e r i l y b e l i e v e , t h a t m e r i t o r i o u s cause o f a c t i o n . 2 9 . THAT I have read the S t a t e m e n t h e r e i n on b e h a l f o f t he D e f e n d a n t , Mr. R i c h a r d , and v e r i l y b e l i e v e , h e r p l e a d i n g s a l l e g e s t h a t o f o n e - h a l f o f the pi-oceeds fi^om the s a l e o f p rem i s e s .
30. THAT the Plaintiff Company is prepared and willing to pay into Court to the credit of the within action one-half of the said proceeds fi^om the sale of the said p r e m i s e s , pending the disposition of the \-yi thi n action.
31. THAT I make this Affidavit in support of an application by the Plaintiff Company for an Order directing the payment into Court of one-half of the said p 1-0ceeds , and directing the release of t!-ie balance » of the said proceeds to the Plaintiff Company. SWORN BEFORE I-IE at the City of ) Yel 1 o\-<'kn i fe in the Northwest Te i-ri to ri es , this 2 0 th day A p 1̂ i 1 , . A . D 19 7 8. A CTi.ini'is's j 0 n c r To r Oaths i n a n d )
for the ilorthwest Terr i to IM'es . ) My Commission e xp i res . . . ilOT . . )
T h i s n o t i c e o f n i o t i o n came on b e f o r e on the 3 r d day o f May, A . D . 19 78 and a t the d e f e n d a n t a p p l i e d f o r an a d j o u r n m e n t c o u l d c r o s s - e x a m i n e t h e d e p o n e n t , sworn on A p r i l 2 0 t h , 1 9 7 8 . An a d j o u r n m e n t g r a n t e d b u t s u b s e q u e n t t o t ' l o g r a n t i n g o f f o r the d e f e n d a n t a d v i s e d t h a t c r o s s - e x a m i n a t i o n was n o t p roceeded w i t h b u t t h a t a m o t i o n was g o i n g o f t i l P r l p - F o n r l ^ s n - f -.i ^
made the payments t o t h e s t i p u l a t e d A g r e e m e n t . o f C l a i m f i l e d Company, and I am S o l i c i t o r , J . Edward R i c h a r d , the P l a i n t i f f Coinpany has a o f De fence f i l e d and I am a d v i s e d by t h a t the D e f e n d a n t i n she i s t he b e n e f i c i a l owner t l i e s a i d
) ) ) ) " C o l i n A l e x a n d e r " ) C o l i n A l e ;•; a -i d e r
me a t Y e l l o w k n i f e t h a t t i m e c o u n s e l f o r so t h a t t h e d e f e n d a n t C o l i n A l e x a n d e r , on h i s a f f i d a v i t f o r t h i s p u r p o s e was the a d j o u r n m e n t c o u n s e l b e i n g t o be made en b e h a l f
An a p p l i c a t i o n was a c c o r d i n g l y made by t h e d e f e n d a n t » t h i s c o u r t , by way o f n o t i c e o f m o t i o n , r e l i e f was s o u g h t : . ( a ) An 01-de r s t a y i n g the P l a i n t i f f ' s r e t u r n a b l e I-lay 31^d , 1978 as a d j o u r n e d , t h e d e t e i m i n a t i o n o f M o t i o n , p u r s u a n t to Rule ( b ) An O r d e r d i r e c t i n g t l i e p a r t l y f a c t and p a r t l y a g r e e m e n t and t r u s t P l a i n t i f f i n i t s S t a t e m e n t o r i s v o i d b e i n g c o n t r a r y t o P a r t 17 o f t he R u l e s ; ( c ) Upon t h e i s s u e s t a t e d b e i n g d e c i d e d i n a f f i r m a t i v e , an o r d e r d i r e c t i n g a c t i o n be d i s m i s s e d as b e i n g an abuse o f o f t h i s C o u r t , pu i''s uan t t o Rule \ I n s u p p o r t o f t h i s a p p l i c a t i o n a f f i d a v ' i . . e v i d e n c e b u t i ^ e l i e d upon the p l e a d i n g s a f f i d a v i t o f C o l i n A l e x a n d e r and the f o l l o w i n g documents I'ere i n t r o d u c e d i n ' o e v i d e n c e p u r s u a n t Fvi deuce O r d i na i ice :
1 . T r a n s f e r d a t e d O c t o b e r P u b l i s h i n g Company L t d . J a n i s E. A l e x a n d e r , as j o i n t a s E x li i b i t " 1 " ; 2 . M o r t o a g e f i l e d under No. 14 ,199 on O c t o b e r 1 9 7 4 " f r o m A. C o l i n A l e x a n d e r as j o i n t t e n a n t s to C e n t r a l C 01' p 0 r a t i 0 n ;
A b s t r a c t o f t i t l e c o n f i i n i i n g A. and J a n i s E. A l e x a n d e r p r o o e i t y l e g a l l y d e s c r i b e d i n t h e C i t y o f Y e l l o w k n i f e , T e r r i t o r i e s , a c c o r d i n g i n t h e Land T i t l e s O f f i c e T e r r i t o r i e s u n d e r No. 6 3 7 ; zM
t o i n w h i c h the f o l l o w i n g a p p l i c a t i o n p e n d i n g the m a t t e r r a i s e d i n t h i s 2 2 1 ( 1 ) ; the d e t e r m i n a t i o n f o r t h w i t h o f law i s s u e o f w h e t h e r t he r e l a t i o n s h i p p l e a d e d by t h e o f C l a i m f i l e d i s i l l e g a l t o p u b l i c p o l i c y , p u r s u a n t t h e t h a t t he P l a i n t i f f ' s t h e p i ' ocess 129 . the d e f e n d a n t d i d n o t f i l e f i l e d , t h e w h i c h t o s e c t i o n 4 4 o f t h e
2 1 s t , 1974 f r om Y e l l o w k n i f e to A. C o l i n A l e x a n d e r and t e n a n t s and inaiMced 2 1 s t , and J a n i s E. A l e x a n d e r Mor tgage and H o u s i n g
C o l i n A l e x a n d e r as r e g i s t e r e d owners o f as L o t 4 , B l o c k 8 7 , i n the N o r t h w e s t to a p l a n o f s u r v e y f i l e d f o r t h e N o r t h w e s t
10 -4. C a v e a t r e g i s t e r e d by Cen t r a l f:ortgage and H o u s i n g C o r p o r a t i o n on the 25th day of N o v e m b e r 1974 u n d e r » N o . 1 4 , 3 5 1 ; 5. T r a n s f e r da.ted F e b r u a r y 1 0 t h , 1978 from A. Colin A l e x a n d e r and J a n i s E A l e x a n d e r to R o b e r t 0. B a e t z and Plargreta G. B a e t z as j o i n t t e n a n t s .
T hese two a p p l i c a t i o n s r e f e r r e d t o w e r e a r g u e d b e f o r e me by counsel on the same d a t e . By a g r e e m e n t b e t w e e n counsel the a p p l i c a t i o n of the d e f e n d a n t for an O r d e r d i s m i s s i n g the pla i n t i f f ' s a c t i o n as an a b u s e of p r o c e s s pui'suant to Rule 129 was argued f i r s t . I r e s e r v e d j u d g m e n t on this a p p l i c a t i o n and then p r o c e e d e d to h e a r the a p p l i c a t i o n of the p l a i n t i f f for the relief s o u g h t in its n o t i c e of m o t i o n . J u d g m e n t on this a p p l i c a t i o n '.•/ a s a 1 s 0 r e s e 1̂ v e d . • I a c c o r d i n g l y turn to a cons i de i'a ti on of the a p p l i c a t i o n of the d e f e n d a n t to h a v e t'le p l a i n t i f f ' s action d i s m i s s e d as being ..̂
an abuse of the p i o c e s s of the c o u r t p u r s u a n t to Rule 129 of the Rules of C o u r t w h i c h p r o v i d e s as f o l l o w s : " 1 2 9 ( 1 ) The c o u r t . !,-,ay at any s t a g e of tlie p r o c e e d i n g s o r d e r to be s t r u c k o u t or ai.-iended any p l e a d i n g in the a c t i o n , on the g r o u n d t !i a t (a) it discloses no cause of action or defence, as the case may be, or (b) it is scandalous, frivolous or vexatious, or (c) it may prejudice, embarrass or delay the fair trial of the action, or (d) • it is otherwise an abuse of tlie process of the court, and may order the action to be stayed or dismissed or judgment to be entered accordingly.
(2) No evidence shall be admissible on an application under clause (a) of subrule (1).
(3) This Rule, so far as applicable, applies to an • originating notice and a petition." ^ ^
11 -I Learned counsel for the defendant contends that if there is a trust relationship alleged by the plaintiff in its statement o f c l a i m then it is fraudulent or illegal. In this connection counsel for the defendant i~e 1 i e s strongly on the allegations of fact pleaded in paragraphs 3 to 3 in the statement of claim. Dealing with tliis matter learned counsel for the defendant referred specifically to the case of 0'Ke11y v. Down i e Vol. VI W.W.R. 911 and particularly at 912 where Chief Justice Howell stated as follows: "The defendant in his answer to the amended statement of claim, ^ e t up t hi e original, and claims that it is thie record in this cause, or, at all events, that the plaintiffs are bound by it.
In Da n j e_l̂ Ls._ _Cji an ce r y_. Px^. £ t jj:_e_, 7th ed., at p. 4 9 0 , » the following is statod:-.;5 'The right of one 'party to read the pleading of another party as evidence against the latter is confined to the pleading as it stands, so that if the pleading has been amended, the original pleading cannot be read as such evidence.'
This principle is stated to be the law in Ai-inual_ Prajitice, 1 9 1 4 , at p. 581. That is also my ineinory of the practice in the past."
Learned counsel for the defendant Janis E. Alexander submitted that when you read the allegations contained in the statement of claim together with the provis.ions of the National Housing A c t , it is very clear that the transaction relied upon by the plaintiff corporation is fraudulent or illegal. It is contended that the course of conduct relied upon by the plaintiff constitutes a deceit on Central Mortgage and Housing Corporation and in particular learned counsel for the applicant referred ^
12 ft to the f o l l o w i n g , inter a l i a , p rovisions of the National H o u s i m A c t : '6-.(l) S u b j e c t to section 7, a loan is i n s u t̂ a b 1 e i f
(b) it was m a d e to (i) the person (in this Act called the "home o w n e r " ) wlio owns tlie house or condominium unit and intends to occupy the h o u s e , one of the family housing units thereof or the con-' d 0 in i n i u in u n i t ,
(ii) a b u i l d e r who intends to sell the house or c o n d o m i n i u m unit to a person (in this Act call e d the "home p u r c h a s e r " ) who will own and o c c u p y the h o u s e , one of tlie family housing units t h e r e o f or the condominium u n i t ,
(iii) the person who owns the farm upon v.'hich the ho u s e has been b u i l t ,
I (i V ) the c o o p e r a t i v e li o u s i n g association that owns the c o o p e r a t i v e housing p r o j e c t , (v) the perst-n who intends to occn,py the e x i s t i n g h o u s e , one of tlie fauii 1 y housing units t h e r e o f or the condominium u n i t , or
( V i ) 111 e person \'.' h o o \-.' n s the rental housing p r o j e c t ; "
"34.15 (1) The C o r p o r a t i o n may i.iake a loan for the p u 1 - p 0 s e of a s s i s t i n g in the c o n s 11~ u c t i o n or acquisition of a ho u s e or the a c q u i s i t i o n of a con d o m i n i u m unit by a n i I'l d i V i d u a 1 .
(2) A loan m a d e under the authority of this section
(a) shall bear interest at a rate determined by the Corpora ti on;
(b) shall not exceed such percentage of the lending value of tlie Iiouse or concionii ni um uni t as may be pi^escribed by regulation of the Governor in Council;
\ ^
13 ft (c) shall be for a term not exceeding forty years fĵ oin the date of completion or acquisition of the house or acquisition of the condominium unit;
(d) shall be secured by a first mortgage upon the house or condoini ni uin unit in favour of the Corporation or such other security as the Corporation deems adccpiate to safeguard its interests; and (e) shall be repayable by such payments of principal and interest as are satisfactory to the Corporation.
(3) Loans may be made under the authority of this section only in respect of family housing units not exceeding such cost as may be prescribed by regulation o f t h e Governor in Council, and only where the housing units will, upon completion or acquisition, be occupied by not less than such number of pei-sons as may be prescribed by regulation of the Governor in Council."
"58.(1) Whei^e in the opinion of the Coi^po îa t i on a loan is not being made available to a person pursuant to Part I or section 14, the Corporation may'make such a ) loan on the sane tei-ms and conditions end subject to the same limitations as those upon which a loan ;';ay be made to such person under Part I or section 14.
( 2 ) !•/ h e n the C o î p o r a t i o n makes a loan under this section pursuantto Part I, it shall collect from the b0rr0v/er an insurance fee in tIie same amount as an approved lender would collect from the borrower if the loan wore made by ai-i approved lender.
(3) The Corporation shall pay tlie amount of any insurance fee collected pursuant to subsection (2) into the Mortgage Insurance Fu,-id, and any loss incui^red by the Corporation in i-espect of such loan when held by the C0-rp0 îa t i 0n shall be charged to the Fund to the extent of the amount that i-.'ould have been payable to an appi^oved lender pursuant to section 8 if the loan had been !ie 1 d by the approved lender, and the mortgaged property acquired by the Coi^poration shall be an asset of the Fund
(4) V.'hen a loan is made under this section on behalf of the Corporation by an approved lender the mortgage taken in respect thereof may be taken in the name of the Corporation or in the name of the approved lender as determined by agi^eement between the Coi'poration and the approved lender. 1953-54, c. 23, s. ^0; 1956, c. 9, s. 16; 1954-65, c. 15, s. 16; 1958-69, c. 45, s. 21." ^ ^ ^ ^
14 ft It should also be pointed out that in chapter 38 S.C. 1974-75-76 the term "individual" as used in section 34.15(1) of S.C. 1973-74 was amended to read as follows:
"34.15(1) The Corporation may make a loan for the purpose of assisting in (a) the construction of a house or a condominium unit by a person (in this Part called the "qualified owner ) who owns the house or condominium unit and intends to occupy the house, one of the family housing units thereof or the condominium unit, or by a builder who intends to sell the house or condominium unit to a person (iinn thhiiss Parrt call lleed thhe "quaallii fiieed pur^chh aser") ho w i l l own and occupy t h e h o u s e , one o f t he f am i ly h o u s i n g u n i t s t h e r e o f o r t h e condomin ium u n i t , o r (b ) t he a c q u i s i t i o n o f a house o r a condomin ium u n i t Dy a p r o s p e c t i v e q u a l i f i e d o w n e r . " • In s u p p o r t o f i t s p o s i t i o n w i t h r e s p e c t to t h i s a p p l i c a t i o n , counsel f o r the d e f e n d a n t , Jani<s E. A l e x a n d e r , r e l i e d upon the f o l l o w i n g , i n t e r a l i a , a u t h o r i t i e s : ( 1 ) C h e t t i a r v . C h e t t i a r P.O. 1962 1 A l l Eng land Law R e p o r t s 494 (2 ) Berg v . S a d l e r and Moore fT937j 2 K.B. 158 (3 ) El f o r d V. El f o r d /T92ZT 3 W.W.R. 339 p a r t i c u l a r l y a t 345 (4 ) Zimmermann v . Letkeman /T97 7f 6 W.W.R. 741 (5 ) Fesse r v . McKenz ie /T9 7l7~ 1 W.W.R. 620 (6 ) Hanbury Modern E q u i t y , N i n t h E d i t i o n 34 . After carefully reviewing these authorities, I am of the ) opinion that they can be distinguished on a footing that they deal with situations where the trial judge after hearing all of the
15 ft e v i d e n c e has made a de t e rin-i na t i on o f a p p l i c a t i o n , I am b e i n g asked by way o f s t r i k e o u t t h e p l a i n t i f f ' s c l a i m w i t h o u t e v e r b e i n g h e l d . I n my o p i n i o n t h e law i s w e l l n o t l i g h t l y be d e p iM e v e d o f i t s t he c o u r t s and a s t a t e m e n t o f c l a i m s h o u l d be s t r u c k the c l e a r e s t and most o b v i o u s c a s e : (1 ) G_re_a_t N o r t h e r n Ra i 1'.-/ay Company y . "Agencies Utd". e t a l ( 1 9 5 4 1 4 9 ¥ . W . " R " ' . "15 3 ; ( 2 ) B J 1 a c k 0 v ._ J a t on ' s o f SL^J}Jlda__l i in [ t e ^ 6 0 W."W."R; " ( i r s . T " 2 2 .
) Rule 129 was a l s o c a i - e f u l l y i n the A p p e l l a t e D i v i s i o n o f t he Supreme C o u r t o f Cerny v . Canad ian I n d u s t r i e s L i m i t e d e t w h e r e i n C a i r n s , J . A . i n g i v i n g j u d g i n e n t comp le te r e v i e v / and e x p o s i t i o n o f C a i r n s , J . A . s t a t e s as f o l l o w s : ' I t i s c l e a r f r o m t h e s e d e c i s i o n s s h o u l d n o t s t r i k e o u t a p l e a d i n g o i- p a r t as d i s c l o s i n g no cause o f a c t i o n f r i \' 01 0 u s o r v e x a t i o u s o r as b e i n g an a ti u s e o f the p i ' ocess o f t h e c o u r t , w h i c h wou ld have t h e e f f e c t o f d i s m i s s i n g or d e n y i n g a p a r t y a r i g h t the q u e s t i o n i s beyond d o u b t r e a s o n a b l e cause o f a c t i o n ; r a i s e d f i t t o be t r i e d by a j u d g e o r j u r y , m e r e l y because i t i s d e m u r r a b l e ; m a t t e r c o m p l a i n e d o f i s o n l y s e t u p , o r ' w h e r e by g o i n g t o
t he i s s u e . On t l - . is p a r t i c u l a r i n t e r l o c u t o r y r e l i e f t o any t r i a l o f t h e . i s s u e s e t t l e d t h a t a p l a i n t i f f s h o u l d r i g h t t o have i t s cause t r i e d i n o u t o n l y i n CoJ e_
c o n s i d e r e d i n a i -ocent j u d g m e n t A l b e r t a , a l iy\91?J 6 W.W.R. 83 f o r t l i e c o u r t makes a t l ie r e l e v a n t l a w . At page 95 t h a t a c o u r t t h e î e o f zr as b e i n g i n most cases an a c t i o n t o d e f e n d , u n l e s s and t h e r e i s no o r a q u e s t i o n i s o r o r where the p a r t o f t he a c t i o n t r i a l the f a c t s ^
- 16 -" c o u l d be e l i c i t e d w h i c h w o u l d have some e f f e c t on t h e c a s e , o r where j u s t i c e and reason d i c t a t e t h a t i t s h o u l d go t o t r i a l ; o r wl iere a p l e a d i n g i s n o t c l e a r l y v e x a t i o u s o r f r i v o l o u s b u t w h i c h ft w o u l d , i f i t were a l l o w e d t o s t a n d , be an abuse o f t h e process__of t h e c o u r t ; o r where q u e s t i o n s o f g e n e r a l i m p o r t a n c e are r a i s e d o r s e r i o u s q u e s t i o n s o f law a re i n i s s u e , u n l e s s the m a t t e r i s e n t i r e l y c l e a r . "
He t h e n goes on t o s a y : "These are generally the points which have to be considered under R. 129 but, as I have stated above, most of them apply to an application to strike out a pleading under the inherent jurisdiction of the court. This jutMsdi ction is exercised to stop the abuse of the process of the court or to prohibit scandalous, frivolous and vexatious actions. This po\';er of the court certainly should not be exercised to strike out a pleading or to strike out a party from an action where there is a serious point of law to be considered which cannot be said to be clear. How can such a pleading be an abuse of the process of the court or frivolousor vexatious?"
In dealing with this matter I have also carefully considered and \ follow the approach of Morrow, J. in a recent unreported judgment in
the Northwest Territories case of Poole Construction Limited et al v. Hood & Gardner Architects Limited et al dated April 28th, 1978. In my opinion, the above principles are applicable to this case and I adopt with respect the approach of Cairns, J.A. Under the circumstances I feel that it would be inappropriate for me to deprive the plaintiff of a trial on what to me appears to be substantial issues. In arriving at this conclusion I am not unmindful of the fact that a finding of illegality may not be conclusive as against the plaintiff. See Gorog v. Kiss 78 D.L.R. (3d) 690. The application of the defendant Janis E. Alexander for the relief sought in her notice of motion dated May 12th, 1978 is accordingly dismissed with costs.
- 17 -I turn now to a consideration of the application of the plaintiff set forth in its notice of motion dated April 20th, 1978. Learned counsel for the plaintiff Yellowknife Publishing Company Ltd. contended that the court should direct payment into court to the credit of this action of the sum of $16,237.73 being one-half of the net proceeds of the sale of the property in question. On the facts of the case, he submitted that the very most that the defendant v;ould be entitled to would be a one-half share of the proceeds. Counsel for the defendant took the position that one of the issues that will have to be determined by the trial judge is whether or not there is in law an existing joint tenancy. As far as the defendant is concerned she is prepared to see the joint tenancy maintained and^ under the circumstances I have to consider whether or not this issue should not more properly be dealt with by the trial judge. I do not think that I should decide on an interlocutory application of this nature whether or not the joint tenancy has been severed. There are perhaps compelling arguments that could be made to suggest that the joint tenancy has in fact been severed but in the absence of full and complete evidence on the issue I do not think that such a declaration should be made on an interlocutory application.
The words of S i r W. Page Wood V-C in w r n A a m ^ v & H. 5 4 6 , 70 E.R. (1851 ) , 1 John tatement on the severance of a joint recognized as the classic s tenancy:
H e n s m a n 862 a t 8 6 7 , a r e g e n e r a l l y
18 i "A j o i n t - te n a n cy may be se V 0 r a 1 i n t h r e wa ys : i n t he fi rs t pi ace , an ac t of a n y one of the per sons i n te r e s t e d 0 p e ra t i n g upon his 0 v;n shar e may c r e at e a se ve r a n e e as to t h a t s il a r e. Th e right of ea ch j 0 i n t ten a nt is a r i nh t by s u r v i V 0 )̂ s hi p only in t he c Ve nt of no s e v e r a nee ha V i n g t aken p l a c e of the share w h i ch is cl ai med u pen th 2 jus acci^ e s c e n d i_. Eac h one i s a t 1i berty to d i s p 0 se of h i s ow n i n t e re s t in such ina nne r as to se ve r i t from t he jo i n t f u n d - -1 0 s i n g , of cou rse , at the s ame ti ine , his 0 \7 n r i g h t o f s u r V i 0V r s h i p S e c 0 n d 1 y , a jo i n t - te n a n c y may be se V e )- e d by inutu a 1 a g re eme nt. And , i n t he th i rd p i ace , t h e r e may be a s e ver a n ce by any c 0 u r se 0 f d e a 1 i ng s u f f i c i e tn to in ti ma te tha t the i n t e res ts of al 1 wer e in u t ua 1 ly t r e a t e d as CO ns ti t u t i n g a te nancy in CO iiinion . K'he n the s e V G r a n ce dep en d s on an i nfe r e n c e of th i s k i n d w i t h 0 u t any e x p re ss a ct 0 f se ve r a n e e , i t wi l 1 n o t s uf f i c e to r e l y on an i n te n ti on , with re s p ect to the p a r t i cu 1 ar sh a r e , d e c 1 a )̂e d 0 n ly beh i n d t he back s o f the 0 t h e r p e r- s 0 ri s i n t e r e s ted. You mu St f i n d i n t h i s c l ass 0 f case s a e c u rse of dea 1 1 ng by w h i c h the s h ares o f al 1 the p a r t i e s to th e CO n tes t have b e e n G f fec t e d , as ha p p G n e d i n the cases of Wils on_ v_. Bel_l_ (1843 ) , 5 I. Eq. R. 501 , and Jack son V 7 J a c k s 0n " '(1 SO4 ) , 9 Ves . 591 , 32 E.R. 7 3 2. " 1 In tliis c o n n e c t i o n I h a v e a l s o c o n s i d e i - e d t h e f o l l o w i n g , i n t e r a 1 i a , a u t h 0 r i t i e s : (1) Ginn v. Armstrong (1969), 3 D.L.R. (3d) 285; (2) Sc_hoxiGl_d_ v^irjha^ (1969), 69 W.W.R. 332, 6 D.L.R. •("3d") S"3T
( 3 ) Re D r a p e r ' s Ĉ on veyan ce ; N ihan v . P o r t e r , /T969J 1 Ch. 4 8 6 , 1)96If 3 A l l E.R. 8 5 3 ; ( 4 ) Munr^e j ^ _ C a r l s o n 21 R . F . L . 3 0 1 , /_r976^7"l W.W.R. 2"48 , 5'9 D . L . R." C3d ) 7 6 3 ; ( 5 ) G r a n t v . G ran t /T9S2J O.W.N. 6 4 1 ; and ( 6 ) N^iel_son^JonGS v. f_edj\ori, / _T97 i7 "3 W . L . R . 5 3 3 , /_T97i7 3 " A T 1 " " ~ E . R':'"38.
For t h e fo i~Ggo ing reasons I am o f t h e o p i n i o n t h a t the o r d e r s o u g l i t by t h e p l a i n t i f f s l i o u l d n o t be g r a n t e d on t h i s # ^ ^ ^
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19 interlocutory application and I accordingly dismiss the application of tlie plaintiff with costs. I have no doubt that it is desirable that matters of this kind be resolved as quickly as possible and under the circumstances counsel may apply for an early date for trial once the certificate of readiness has been filed. DATED at the City of Yellowknife, in the Northwest Territories, this 20th day of June, A.D. 1978.