Chunara v Jina, 2011 ABQB 709

Court of Queen ’ s Bench of Alberta Citation: Chunara v Jina, 2011 ABQB 709 Date: 20111118 Docket: 1103 05102 Registry: Edmonton Between: Fayaz Nizarali Chunara Applicant - and - Sha Jina also known as Sha Sultan Jina and Shasultan Jina Respondent _______________________________________________________ Reasons for Judgment of the Honourable Mr. Justice Donald Lee _______________________________________________________ [ 1 ] This is an application under Rule 7.3 of the Alberta Rules of Court for

Summary Judgment. The Applicant deposes that he loaned the sum of $500,000 to the Respondent in four installments, with interest payable on the loan at 10% per year. The loan was supposed to be repaid in six installments, with the first installment due on January 31, 2011. This is evidenced by the Promissory Note that the Respondent signed on December 13, 2010 acknowledging receipt of the $500,000, and the repayment schedule.

As well the Promissory Note specifies that it would be secured by way of Caveat on six properties owned by the Respondent. [ 2 ] The Applicant deposes that the Respondent has made no payments on either interest or principal, and that three of the six properties secured for the Promissory Note are now under foreclosure proceedings.

[ 3 ] The Respondent filed a Statement of Defence in this matter on May 19, 2011 which reads as follows:– 1. The Defendant, Sha Jina denies all allegations contained in the Statement of Claim; except that the $500,000 was to be loaned to her and secured by the following properties listed on paragraph #5 on the Statement of Claim from the Plaintiff. 2.

The Defendant denies, agreeing to sign any agreements, contracts explaining all instruments involved which, may include: interest rates, loan values, breaches of default, terms, or any other provisions within a typical contract or agreement which would be standard practice in lending monies on property. 3. The Defendant states that the Plaintiff’s claim is statue barred. 4. The Defendant was misrepresented in all aspects verbally, and written in agreeing to any monies loaned to her and would have not loaned any monies from the Plaintiff, if she would of known of all terms and provisions. 5.

The Agreement is void from the beginning because there was no contract stating all the provisions to the Defendant, which could be considered fraud to the Plaintiff. [ 4 ] The Respondent has not filed any Affidavit denying the facts alleged by the Applicant. [ 5 ] Reluctantly I have agreed however to receive a copy of the Respondent’s speaking notes and argument for today’s application given that as a self represented party the Respondent is nervous about these Court proceedings. These written notes provided to me read as follows:– 1. Your Honor In the name of God, the most beneficent, the most merciful.

All praise is due to God! The most Gracious, guide me and lead me to clear path and higher life. With utmost faith, I have been sowing the seeds of goodness. The whole world, countries are going bankrupt, and I am only one person trying to keep afloat and has done very well in my work as a Financial Advisor, and the Judgement will destroy my livelihood, and I won’t be able to operate in my profession. I willingly put the caveat on my properties to protect his interest and the idea was to protect their interest and also agreed to pay 10% interest per annum.

I have every intention to pay, but did not expect the Applicant to turn out like my second mortgage lender, as now he is trying to take my properties, When the Applicant gave me the loan, I was very grateful that the Applicant Is being very kind to loan me these funds at a much lower rate then the Private lenders, and shared my whole portfolio and also, offered partnership and gave him the best of the six properties, that could be sold even in the down market, or could be used as revenue properties if the need arises and had lot of discussions and meetings and as soon as the sale did not materialize, as the buyer is in the business of buying/selling real estate to its entirety, he planned to buy my few properties so I could pay and keep my promise but was referred to the mortgage officer by my second mortgagee and somehow never closed, so I requested the buyer to buy my house and with my luck he could not close on time as he had to go away for almost a month and he was serious in the closing on January 31 / 2011 and then he got his tenant in his million dollar property, paying him $4,400 of rental income stopped paying his rent and that put him in a very bad situation and he did not perform in the buying.

But I never loose hope, so I agreed but once I secured his position, he renege on his promises.

I realized how it was very expensive money from second mortgagee especially if, in the end, after paying them the high interest and their fees, they take your houses as well. As, I was placed in this predicament by the previous second mortgagee. I had been ill for almost 3 months without a permanent job for almost two years, so I looked after my properties.

I was doing fine, until the second mortgage guys manipulated and telling me that they will charge 16% for annual and sell all my properties and with the Market in Real Estate, they made a killing by charging me 16% annually and 5% renewal fee quarterly and other legal fees and expenses etc. It became A nightmare when, after paying from June/2009 to June/20 11, he threatened, and stressed me about judicial sell and asking for more money for redemption, a $5,000 fee was asked from me, and in the mean time I had buyers for the sale of the properties happening, but the buyers needed a Vendor take back.

To which, he convinced me to transfer the title to the second mortgage, which was with Zameen Mangement Ltd., to facilitate the sells of the properties. Namely two properties named (128 Callingwood Place, and 17804-93 Ave.) But to my surprise, he made it extremely difficult and wiping my equity completely by setting the price which would pay my First mortgage and his second\.mortgage. I do need at least 12 months to pay him, as I am selling be paid out totally and I can afford to back to my own work, which is Financial Advisor in the Insurance Industry. 2.

Your Honour I am not behind on any of my first mortgages and have saved all my houses from being foreclosed so the Plaintiff Fayaz Chunara and myself would not loose by Judicial Sale by the first mortgages, and I, willingly have placed the caveats for the Plaintiff, Fayaz Chunara and was really under the understanding that on the sales of my properties he will get paid first from the sale proceeds as I do not have to pay 16% and 5% renewal fee plus administration fee and all the expenses, and when the Paintiff [sic] Fayaz loaned me the $500K at 10% interest, on October 01 st , 2010 I was very grateful to know the Plaintiff, Fayaz Chunara, in this economy and recession is he really was helping me and insisted to pay out the second mortgagee (Zameen Management Investments Management Ltd) not only charging high interest plus renewal fee, admistration [sic] fee, legal fees etc... so I called Munir Virani of Zameen Investment Management and Munir, gave me the payout for Txn 51 for $160,000.00 securing my 5 properties namely: 175 CALLINGWOOD PLACE, 129 CALLINGWOOD PLACE 5127 - 200 STREET 10916 - 157 STREET 202 CHATEAU PLACE and paid Munir of Zameen Investment Management Ltd, on October 1 st , 2010 $196,622.42 Draft # 55068503 from Toronto Dominion Bank to clear Zameen Mortgages and releasing security on the above properties.

On October 141h, 2010 paid Zameen Investment Management Ltd another $40,000.00, and he released all the above properties except 129 Callingwood Place as Zulfikar Jiwan and Shamim Jiwan were purchasing and Munir of Zameen Investment Management told me as Zulfikar Jiwan and Shamim Jiwan are purchasing 129 Callingwood Place and you have an unconditional offer, I will release this and will let the lawyers know that I have paid in full to Zameen Investment Management Ltd.

interest in this economy, and I signed the Promisory [sic] Note and also, told him, I have sales happening and I will pay you from those sales even though I have given you the peace of mind that you wanted and registered you on my personal residence and other properties which were with Munir (Zameen Investment Management) and paid I do not loose anymore but could keep up to my commitment to pay all my indeptedness [sic] to the Plaintiff, Fayaz, Chunara, creditors, friends and families, who have utmost faith in me to do so even in this housing market and this economic recession, I have listed all my properties with a very highly reputable firm, which came highly recommended and have now reduced the listings with my Realtor, to the purchase price which I agreed to sell to the Plaintiff, Fayaz Chunara, as I do not want to transfer my title to the properties and am out of the high second mortgagee interest and fees. (42% - 50% for last 3years) and will not have the stress which I have been carrying with me over the last 3 years, and will achieve the maximum benefit on the remaining of my portfolio which I have struggled so hard to keep it going and can sell properly and not the way the second mortgagee took over by giving me the hope to facilitate the sale and not by transferring the title only but with a real sale through the expert professional help of a real estate agent, can go back to my work and be able to pay all my indebtedness as soon as possible Why do my tenants get open documents and they are not on the title They go through it before me and then they do not pay the rents, and this has caused lot of interference in my rental business and I have evidence to prove it.

I willingly place to secure the Plaintiffs position as well. (and also signed promissory note @ 10% interest quarterly and there was no terms, no time and no contract signed and when the Plaintiff, Fayaz loaned me the $500K we went through my whole portfolio, and I told him that I have sold my house on (11016 - 177 Avenue) and will have approximately 66K to so, Salim Hassam and the maximum amount I will be able to give from this sale will be approximately $50,000, which did not happen as Salim Hassam could not get his mortgage approved, so when I went to register the caveat for your loan on my properties, I also registered a caveat for Salim Hassam on 11016 - 177 Avenue to secure his deposit be able to pay from the proceeds of the sale and also have offers on other two properties namely 17803 - 93 Avenue and 128 Callingwood Place which are held by the second mortgagee and would have approximately $100K after paying first and second mortgagee I will be completely out of my second mortgagee who is charging me a lot more than you, so I will have no problem in paying your loan from the proceeds of the sale of my properties, as I will have no second high interest mortgagee.

Last three years, has been very difficult, as my second mortgagee has charged me 42% - 60% and then also manipulated me to transfer the title to him on February and I paid $5,000 to extend the redemption period, I know how unfairly I have been placed in this economic recession. Conclusion [ 6 ] The party making an application under Rule 7.3 has to prove one or more of the following:– 1. There is no defence to a claim or part of it; 2. There is no merit to a claim or part of it; 3. The only real issue is the amount to be awarded. [ 7 ] When applying for

Summary Judgment as a Plaintiff, the Plaintiff bears the ultimate onus of meeting the requirements of Rule 7.3. The Plaintiff bears firstly the evidentiary burden of proving its cause of action on a balance of probabilities such that every and each fact necessary to support the claim must be proven. The Defendant can avoid

Summary Judgment in favour of the Plaintiff by proving that there is a genuine issue for trial. It must be beyond doubt that no genuine issue for trial exists. [ 8 ] The two Affidavits filed by the Applicant dated June 21, 2011 and September 16, 2011 establish beyond doubt that $500,000 was advanced to the Respondent, and that the Respondent signed a Promissory Note dated December 13, 2011 acknowledging the debt, the 10% interest rate per annum, the Applicant’s right to secure the loan by filing a Caveat on six of her properties, and the Respondent’s acknowledgement of the repayment terms which required that the first installment payment was due on January 31, 2011 in the sum of

$50,000 plus interest. [ 9 ] Although the Respondent has filed a Statement of Defence on May 19, 2011, and her oral argument, that Statement of Defence does not raise any genuine issue for trial, and the oral argument in fact acknowledges that $500,000 was loaned to her by the Applicant. [ 10 ] At this Special Chambers hearing, the Respondent seeks on the hearing date to enter more documents by way of a Fiat granted by this Court.

However it is clear from the background that has been supplied to me in the Affidavit material and through the submissions of the parties, that the Respondent’s only defence is that she is having financial difficulties, and needs more time to sell her houses and pay off the Plaintiff.

This however is no excuse for not having filed any Affidavit and for not filing her Memorandum of Argument, and I cannot grant a Fiat that would allow me to receive further written materials or documents at this point that are not relevant in any event. [ 11 ] The Respondent has only established that she is/was a successful financial planner in the insurance field, and that perhaps she has managed to save some or all of the six properties that the Applicant has a lien on from the foreclosure process.

What the Respondent used the $500,000 for however, and her present financial circumstances are not relevant considerations in determining whether or not to grant

Summary Judgment against her. [ 12 ] I conclude that the Applicant has established his cause of action, and that the Respondent has failed to prove that there is any genuine issue for trial. [ 13 ] Accordingly I direct that there shall be an Order granting

Summary Judgment against the Respondent in the sum of $500,000 together with interest at 10% thereon from October 10, 2010, and that there will be costs awarded to the Applicant. [ 14 ] The Applicant also seeks solicitor/client costs, but I note pursuant to the Promissory Note that solicitor/client costs are not provided for in the event of default or otherwise. [ 15 ] The Applicant also seeks that the lands encumbered by him be sold pursuant to the Law of Property Act , R.S.A. 2000, c. L-7; and that the proceeds arising therefrom are to be paid with respect to the Applicant’s claim.

I note from the Promissory Note that the effect of the Caveats was to place a second mortgage in favour of the Applicant on the Respondent’s properties. As such I do not believe that I have the power of sale pursuant to the Promissory Note itself, and that the Applicant will have to act by taking proceedings pursuant to the second mortgage that the Promissory Note purports to grant, subject to its priority. Heard on the 15 th day of November, 2011. Dated at the City of Edmonton, Alberta this 18 th day of November, 2011.

Donald Lee J.C.Q.B.A. Appearances: Gurinder D.S. Bhangoo Pttaway & Taskey for the Applicant Sha Jina Appeared on Her Own Behalf