Buttau v. Buttau, 2010 ABQB 771

Court of Queen ’ s Bench of Alberta Citation: Buttau v. Buttau, 2010 ABQB 771 Date: 20101208 Docket: 4803 115802 Registry: Edmonton Between: Chandramma Buttau Plaintiff/respondent - and - Daniel Buttau Defendant/applicant _______________________________________________________ Memorandum of Decision of the Honourable Madam Justice J.B. Veit _______________________________________________________

Summary [ 1 ] Mr. Buttau asks the court to authorize the sale of residential property at a price of not less than $228,000.00 with the net proceeds of the sale to be placed in his lawyer’s trust account until agreement between the parties or further order of the court; in support of his application he provides an appraisal of the property for $215,000.00. Ms. Buttau, Mr.

Buttau’s wife who has a lis pendens on the property to protect a matrimonial property interest, opposes the application on the grounds that the municipal tax assessment of $248,500.00 should be used as the basis for a listing price of the property. Also, she opposes Mr. Buttau’s proposed distribution of assets; she states that a $6,000.00 caveat on the residence is invalid and should have been a builder’s lien instead. [ 2 ] Mr. Buttau’s application is allowed.

His appraisal is reliable; it is from a certified appraiser and makes specific reference to both the health hazard designation and the municipal tax assessment. If Ms. Buttau had wanted to provide her own appraisal of the property, she should have done so before now.

[ 3 ] From the proceeds of the sale, in addition to the usual disbursements - real estate fees, legal fees relating to the sale, outstanding taxes, utilities, etc - Mr. Buttau will pay $6,000.00 to a former prospective purchaser of the property to remove its caveat and lis pendens. The net net proceeds of the sale will then be placed in Mr. Buttau’s lawyer’s trust account, to be distributed on consent of the parties or by order of the court. If, within one month of the deposit of the proceeds into Mr. Buttau’s lawyer’s trust account the parties are unable to agree on the distribution of the funds, Ms.

Buttau will forthwith bring an application for distribution, including an application to force Mr. Buttau alone to pay the cost of the removal of the caveat. Cases and authority cited [ 4 ] By Ms. Buttau: 1244034 Alberta Ltd. v Walton International Group Inc. 2007 ABCA 372 , [2007] A.J. No. 1260 1. Background [ 5 ] In 1981, Mr. Buttau became the registered owner of the subject residential property. In 1987, Mr. Buttau married Ms. Buttau. Neither party has ever lived in the property. Ms.

Buttau has filed a lis pendens on the property to protect her matrimonial property interest in the increase in value of the property. The property has been sold under a Residential Real Estate Purchase Contract dated January 17, 2010 for a purchase price of $228,000.00; Mr. Buttau advises that the prospective purchasers under that contract are still interested in completing the transaction if a sale can be accomplished in the near future. [ 6 ] When Mr. Buttau’s application to complete the sale of the property was last before this court, the presiding judge indicated that he could not approve the sale until Mr.

Buttau provided an appraisal. [ 7 ] Mr. Buttau has now provided an appraisal report on the subject property from a certified appraiser; the appraiser sets the value of the property at $215,000.00. That appraiser notes that the property has been tenant-occupied in the past and vacant for one year, that the property has been neglected and is in poor condition overall. The appraiser also notes that there is a Notice of Health Hazard registered on title. The appraisal also notes that the municipal assessment of the property is for $248,500.00. [ 8 ] In 2007, there was a failed attempt to sell the subject property.

The then prospective purchaser asserts that it spent approximately $15,000.00 to clean up the property when the purchase and sale agreement was first made. That prospective purchaser filed a caveat to protect its interest in the property. In 2010, the same prospective purchaser filed a lis pendens in relation to an action pending to protect its interest. Through its lawyer, that former prospective purchaser has indicated that it is willing to accept $6,000.00 in full and final satisfaction of any claims it has on the subject property. [ 9 ] Ms.

Buttau asks the court to require that the current offer be refused because it is for too low a price, that the property be re- listed at slightly above the municipal assessment, that Mr. Buttau be required to insure the property, and that Mr. Buttau arrange to remove the former prospective buyer’s caveat at his expense. She also asks the court to require that Mr. Buttau sell the other residential properties that he owns. 2. Should the sale be authorized? [ 10 ] The sale of the subject property on the terms set out in Mr.

Buttau’s application is authorized. [ 11 ] In coming to that conclusion, I have taken the following into account: - an appraisal from a certified appraiser sets the value of the property at less than the offer price;

- the appraisal notes both the municipal tax assessment and the fact that the property has had a Notice of Health Hazard registered on title; - there is no appraisal evidence which contradicts Mr. Buttau’s appraiser’s opinion as to the value of the property; - Ms. Buttau has not presented any evidence that market conditions suggest that re-listing the property now would likely be to the parties’ mutual benefit. On the contrary, the newspaper

article presented by Ms. Buttau suggests that while property sale prices are remaining constant in the Edmonton area, the number of sales has dipped. In that type of market, a residence burdened with a health hazard notification will not be attractive to the market; - because the property is currently unoccupied, it will be difficult to insure it. While Ms. Buttau believes that sufficient inspection of the property to satisfy insurance requirements is possible, obviously there are more difficulties in dealing with insurance when residential property is unoccupied; - Ms.

Buttau commenced her action for division of matrimonial property in 1999 and placed her lis pendens on the property in 2000. Mr. Buttau is 83 years old. It is time for at least this aspect of the dispute between the parties to be resolved. [ 12 ] As part of the sale arrangement, Ms.

Buttau’s lis pendens will be removed; the removal will not prejudice her interest in this property which will be effected through the preservation of the proceeds of sale. [ 13 ] As part of the sale arrangement, the caveat and the lis pendens filed by the former prospective purchaser will lifted by the payment to that purchaser of $6,000.00.

The treatment of this payment as between the Buttaus is dealt with below. [ 14 ] As part of the sale arrangement, all usual closing obligations will be met, i.e., real estate fees, legal fees relating to the transaction, property taxes and utilities owing will be paid out. [ 15 ] Upon the conclusion of the sale, the net proceeds will be paid into Mr. Buttau’s lawyer’s trust fund. If the parties are unable to agreed to the disposition of those proceeds within 30 days of the proceeds being deposited in the trust account, Ms.

Buttau will bring, and have carriage of, an application to distribute the proceeds, including an application to force Mr. Buttau alone to pay the cost of the removal of the caveat. [ 16 ] There is no basis in the current application to require Mr. Buttau to sell the other residential properties which he owns. 3. How should the caveat be treated as between these parties? [ 17 ] Mr. Buttau shall pay out the caveat and lis pendens of the former prospective purchasers as part of the sale arrangements; however, Ms. Buttau shall bear the financial burden of proving that it was unfair to her interests for Mr.

Buttau to pay out the caveat filed by the former prospective purchasers. [ 18 ] In coming to that conclusion, I have taken the following into account: - Ms. Buttau’s only interest in the property is in relation to one-half of the increase in value of the property from the date of the marriage. She has not applied for, nor been granted, the right to manage the property; in those circumstances, Mr. Buttau’s management decisions, even a decision to make a payment rather than to incur costs to fight a claim, are entitled to respect; - Ms. Buttau has not established on this application that Mr.

Buttau’s wish to pay out the $6,000.00 on the caveat is unfair to Ms. Buttau’s interest in the property. 1244034 Alberta Ltd., the decision on which she relies, deals with a caveat which purported to protect a right to specific performance. Our Court of Appeal held that, in light of the Supreme Court’s decision in Semelhago , the particular claim to specific performance in that case was one of the great majority which could not be maintained.

However, I do not see the relevance of that decision to the case at hand; so far as I am aware, the caveat filed on the subject property purported to protect expenditure of money on the property in reliance on a contract in writing for the sale and purchase of the land. However, neither the caveat itself, nor the holder of the caveat, are before the court on this motion. It may be that, on a hearing the main focus of which would be the validity of the caveat, Ms.

Buttau could establish that Semelhago has some application here or that the prior prospective purchaser should have protected its claim by filing a builder’s lien instead of a caveat. In order to ensure that Ms. Buttau’s rights and interests are not prejudiced, after the sale is concluded, Ms. Buttau will have the opportunity of proving that she should not suffer financially by reason of Mr. Buttau’s decision to pay off the caveat and lis pendens.

[ 19 ] The way in which Ms. Buttau can be fixed with the burden of proving that it was unfair to her interests for Mr. Buttau to have paid out the caveat is to require her to assume the conduct of the application to distribute the net proceeds of the sale. Moreover, given the long time which has elapsed between the filing of the matrimonial property claim and the date of this application, Ms. Buttau must bring an application for distribution of the net proceeds of sale of this property as soon as it becomes apparent that the parties are not able to agree on a disposition; therefore, Ms.

Buttau must bring an application for distribution of the proceeds forthwith after 30 days have elapsed after the deposit of the net proceeds into Mr. Buttau’s lawyer’s account. 5. Costs [ 20 ] If the parties are not agreed on costs, I may be spoken to within 30 days of the release of this decision. Heard on the 2 nd day of December, 2010. Dated at the City of Edmonton, Alberta this 7 th day of December, 2010. J.B. Veit J.C.Q.B.A. Appearances: Martin S. Brett For Ms. Buttau Jason Van Doesburg, Van Doesburg Law For Mr. Buttau