Rap Designs Inc. v. Dean, 2010 ABQB 751

Court of Queen ’ s Bench of Alberta Citation: Rap Designs Inc. v. Dean, 2010 ABQB 751 Date: 20101126 Docket: 0601 05567 Registry: Calgary Between: Rap Designs Inc. And Rodney Potrie Plaintiffs - and - Nelson Dean, Eva A. Perovich, Demiantschuk Milley Burke & Hoffinger LLP., 1192282 Alberta Inc., 1199096 Alberta Inc. And Emerald Land Development Corp. Defendants _______________________________________________________ Memorandum of Decision of J.B. Hanebury, Master in Chambers _______________________________________________________ [ 1 ] This application is by Mr. Dean to stay execution on the

summary judgment granted in the sum of $125,000.00. The judgment is in relation to only part of this action and this action is tied to another action, 0901-11925 (the companion action) which seeks over $13,000,000.00 in damages. [ 2 ] I advised the parties I would provide written reasons as Mr. Dean is self-represented. FACTS

[ 3 ] Mr. Dean is the owner or directing mind of 1192282 Alberta Ltd., 1199096 Alberta Ltd. and Emerald Land Development Corp. Mr. Potrie is the owner or directing mind of Rap Designs Inc. and Planning Protocol Inc. Both Emerald and Planning Protocol are not named in this action but in the companion action. [ 4 ] Mr. Dean and Mr. Potrie had a business relationship which soured, leaving considerable animosity in its wake. The facts are now disputed. The simplest version is that Mr. Dean and Mr.

Potrie planned to develop some lands referred to as the Devon properties, the Caroline properties and the Calgary property. Mr. Dean says that Mr. Potrie was to provide planning and development services only. Mr. Potrie says that they or their corporations entered into partnership or joint venture arrangements. [ 5 ] The lands went into the name of Mr. Dean’s companies and Mr. Potrie filed caveats against them, alleging he had an ownership interest in the Devon and Caroline properties. He also commenced this action.

In this action he alleged that profits from the mortgaging of the other properties should be traced to and accounted for in the value of the Calgary property. [ 6 ] Mr. Dean’s ability to refinance, develop or otherwise deal with the lands was compromised as a result of the caveats filed by Mr. Potrie. Mr. Dean eventually filed the companion action seeking damages. At this point the companion action has been defended and affidavits of records have been filed. [ 7 ] Applications for

summary judgment and

summary dismissal were brought in this action, resulting in a series of orders [ 8 ] In July, 2008, Justice Eidsvik granted an order discharging the caveat filed by Rap Design and its certificate of lis pendens from the titles to the Caroline properties. She also dismissed certain related portions of the statement of claim. Mr. Dean and Emerald Lake Development Corp. were awarded costs. [ 9 ] In March, 2009, Justice Horner granted an order that stated in the

preamble that she had been advised that the caveats against the Devon lands have been discharged and that the court was satisfied that neither Mr. Potrie nor Rap Designs have an interest in the Devon properties. She determined that Mr Potrie and Rap Designs had no interest in the Devon properties and awarded Mr. Dean and 1192282 and 1199096 costs. [ 10 ] In September, 2009, I granted

summary judgment in favour of Mr. Potrie and against Mr. Dean for $125,000.00 based on a simple written contract between the two of them and evidence that the funds had been advanced to Mr. Dean. The loan allegedly related to the Calgary land. [ 11 ] Mr. Dean’s counsel subsequently filed a notice of ceasing to act. Mr. Potrie changed counsel. The matter then came back before me over a year later to settle the terms of the order. Mr. Dean had not acted expeditiously to settle the terms of the order and counsel for Mr. Potrie was required to bring an application. [ 12 ] Mr.

Dean appeared at the application to settle the terms and the order was signed. In that order the outstanding taxed costs in the amount of $41, 436.89 owed to Mr. Dean by the plaintiffs were set off, for a net judgment of $83,563.11. The order granted judgment to both Mr. Potrie and to Rap Design against both Mr. Dean and 1192282. [ 13 ] At that hearing Mr. Dean asked to stay execution on the judgment and I advised him that he needed to give notice and file an affidavit in support. He did so and I heard argument on the issue. At the conclusion of the argument counsel for Mr.

Potrie advised that he wished to file an affidavit in response. I directed that he do so by November 12 and provided a date for Mr. Dean’s reply affidavit, if necessary, and gave a date for further argument on that evidence alone, as argument had otherwise been made. [ 14 ] Upon the return of the matter, counsel for Mr. Potrie failed to appear, and he subsequently advised there was a misunderstanding over the time. The court was unable to contact him and the matter proceeded.

[ 15 ] Mr. Dean objected to the late filing of Mr. Potrie’s affidavit. Mr. Dean stated he had not had time to file a reply affidavit but made verbal argument, much of which consisted of unsubstantiated allegations to which this court has given no credence. ANALYSIS [ 16 ] Counsel for Mr Potrie argued that to obtain a stay Mr. Dean must meet the test described by Justice Johnstone in McCabe v.

Westlock Roman Catholic Separate School District No. 110 1999 ABQB 666 . [ 17 ] In that case the court held that a three part test must be met before a stay can be granted: the appeal must raise an arguable issue; the appellant will suffer irreparable harm that is difficult to compensate by damages; and, the appellant will suffer greater harm if the stay is not granted than if it were, ie. the balance of convenience. [ 18 ] Justice Johnstone also noted that if the primary test could not be met, the court could still grant a stay where there are exceptional circumstances that would make it fit and just that the stay be granted. [ 19 ] The new rule 1.4(2)(

h) provides that the court may stay the effect of a judgment or order. No criteria or test is given for the granting of a stay. However, it seems reasonable that the long-standing test used by the courts would remain and therefore I have considered this application in line with the test used in the past by our courts. [ 20 ] From the information before this court at this time, the primary test cannot be met. Therefore, I have considered this matter under the exceptional circumstances test. Are there exceptional circumstances that would make it fit and just to stay the judgment granted to Mr.

Potrie? [ 21 ] First, the notice of appeal clearly raises an arguable issue as the order filed is broader than the ambit of my decision. The order granted judgment to Mr. Potrie and Rap Designs against Mr. Dean and his company. My decision granted judgment only between the individuals. I assume this error occurred either because my oral judgment lacked clarity or because there was a change in counsel and Mr. Dean’s counsel ceased acting. [ 22 ] I turn next to the history of this matter.

This action and the companion action both relate to a series of business dealings between the parties dealing with various properties. This action covers the claims of Mr. Potrie and his company and the companion action seeks damages for, among other things, his filing of caveats against the properties owned by Mr. Dean’s company. [ 23 ] The court has already found in this action that Mr. Potrie and Rap Design had no right to file the caveats and ordered them discharged. In both instances costs were awarded for a total in excess of $41,000.00. Those costs were not paid.

Giving the plaintiffs the benefit of the doubt, I will assume it was not because they did not have the money to pay these costs, but rather because they were waiting to see if the costs could be offset. Those plaintiffs are now insisting on their right to the immediate payment by Mr. Dean despite the interim nature of their success in relation to the overall litigation between the parties. The question of any damages owing to Mr. Dean or his companies for the wrongful filing of these caveats has not been assessed as it must be done in the companion action. [ 24 ] There has been no trial.

To date three different decision-makers have dealt with parts of this matter. The companion action has not been considered at all. Consideration of the issues between these parties has been fragmentary and no one has considered the entire transaction. [ 25 ] The

summary judgment for $125,000.00 is only a part of the bigger picture and it would, in my view, be unjust to direct it be paid at this time when there are other looming issues which could very much lead to Mr. Potrie or his companies owing a greater amount of money to Mr. Dean or his companies.

[ 26 ] It is fit and just that this judgment be stayed until the appeal of my order is heard or February 1, 20ll, whichever shall first occur. [ 27 ] If the appeal is unsuccessful, the chambers judge can determine if the stay should be extended, determine whether case management is necessary and make any directions he or she considers appropriate to get these matters to trial expeditiously. CONCLUSION [ 28 ] The application for a stay of the judgment is granted. Each party will bear its own costs of this application. Heard on the 3 rd and 24 th day of November, 2010.

Dated at the City of Calgary, Alberta this 26 th day of November, 2010. J.B. Hanebury M.C.C.Q.B.A. Appearances: Nelson Dean for the Defendants Nelson Dean, 1192282 Alberta Inc. And Emerald Land Development Corp., 1199096 Alberta Inc. Mr. Kent W. Jesse Miller Thomson LLP for the Plaintiffs