Zinovina v Mirakova, 2016 ABQB 227

Court of Queen ’ s Bench of Alberta Citation: Zinovina v Mirakova, 2016 ABQB 227 Date: 20160426 Docket: 1501 11057 Registry: Calgary Between: Tatyana V Zinovina Appellant - and - Marina Mirakova Respondent _______________________________________________________ Reasons for Decision of the Honourable Madam Justice B.E. Romaine _______________________________________________________ I. Introduction [ 1 ] This is an application for an adjournment of an appeal of a judgment of the Provincial Court of Alberta (Civil Division), a trial de novo and an order allowing the appellant to amend her pleadings.

II. Facts [ 2 ] The claim is for debt. The Civil Claim document names Boetec Consultants Limited, Edward J. Boldt and Tatyana Zinovina as defendants. In the claim document, the plaintiff Marina Mirakova asserts that Boetec, Mr. Boldt and Ms. Zinovina received a loan of $30,000 from Ms. Mirakova and her husband. She also assertes that the loan was confirmed by a promissory note. Ms. Mirakova states in the claim document that, in original discussions, Mr. Boldt and Ms. Zinovina led her to believe that the loan was a personal loan and not a business loan, that Mr. Boldt drafted the promissory note and that Ms.

Mirakova was not aware that it was not a personal loan. She also asserts that Ms. Zinovina told her that if Mr. Boldt could not repay the loan, Ms. Zinovina would repay it on his behalf. [ 3 ] Ms. Mirakova states in the claim that she and her husband gave money to the defendants personally and know that they travelled to Spain after receiving the money. [ 4 ] Ms. Zinovina defended the claim on the basis that she was not a party to the contract between Ms. Mirakova and Boetec, but was merely a witness on the promissory note signed by Mr. Boldt of Boetec.

She stated that including her in the claim was erroneous. [ 5 ] There was no pre-trial conference and no documents were exchanged before trial. Boetec and Mr. Boldt were noted in default and judgment entered against them. Ms. Mirakova was represented by an agent at trial, and Ms. Zinovina was self-represented. [ 6 ] The trial judge found that the loan was a personal loan by Ms. Mirakova to Ms. Zinovina and that the parties never entered into discussions that the loan was to and on behalf of Boetec. He believed Ms.

Mirakova’s testimony that she did not sign the promissory note because it wasn’t reflective of the nature of the transaction between her and Ms. Zinovina. He questioned the authenticity of the promissory note and accepted what he characterized as corroborative evidence of Ms. Mirakova’s husband and daughter. [ 7 ] The transcript confirms Ms. Zinovina’s submission on appeal that she was taken by surprise by Ms. Mirakova’s arguments at trial, which are not consistent with the claim as described in the Civil Claim document. Ms.

Mirakova’s agent in her opening statement at trial stated that she would show that the promissory note was a fraudulent document and that it was not signed by Ms. Mirakova. The trial judge commented that this was not in the Civil Claim, which in fact asserts that the loan was confirmed by the promissory note. [ 8 ] The Court became aware that Mr. Boldt was in the courtroom, although he wasn’t called as a witness by either side. Ms. Mirakova’s agent confirmed that Mr. Boldt was the “default debtor”, which was inconsistent with the argument Ms. Mirakova was making that she loaned the money to Ms.

Zinovina rather than Mr. Boldt or Boetec. [ 9 ] Ms. Mirakova testified that the loan was made on June 30, 2012, that she and her husband gave Ms. Zinovina $30,000 cash, and that she used the money to go to Spain. She said that she received some emails from Ms. Zinovina where Ms. Zinovina referred to herself as executive vice-president of Boetec. She did not produce the emails as evidence, but she did produce corporate records of Boetec, which did not refer to Ms. Zinovina in any capacity. [ 10 ] The Court then advised Ms. Mirakova’s agent that he had heard “very scant evidence” in support of any claim against Ms.

Zinovina, and reminded the agent that the plaintiff bore the burden of proving the claim. He reminded her that the pleadings referred to a promissory note, “with no caveat that there was any fraud or any other type of issue that clouds the legitimacy of that document”. [ 11 ] Ms. Mirakova then testified that in June, 2012 she handed over $30,000 in cash to Ms. Zinovina in a car outside a bank branch, that Ms. Mirakova counted it and then gave it to Mr. Boldt. She testified that she only knew about Boetec from the promissory note.

She didn’t have any copies of bank statements or indications of withdrawal of that amount of money, which she testified she had withdrawn in $500 and $10,000 amounts over a two week period. [ 12 ] Ms. Mirakova testified to a meeting in Starbucks with Ms. Zinovina at which Ms. Zinovina said she was sorry that Ms.Mirakova had lost money and that she would pay her. She said that Ms. Zinovina had suggested a promissory note, and Ms. Mirakova agreed. There was some confused evidence about two versions of a promissory note with different dates. [ 13 ] Ms.

Mirakova testified that she and her husband attended a meeting with Mr. Boldt in July of 2013 where he presented a promissory note already signed and sealed by him. Later, she said, Ms. Zinovina arrived and translated discussions between Mr. Boldt and Ms. Mirakova. Ms. Mirakova testified that she asked why Ms. Zinovina’s name was not on the document, and Ms. Zinovina said not to worry, that she was a witness. She testified that she refused to sign the promissory note, because she didn’t agree with it, that it was a personal loan between her and Ms. Zinovina. [ 14 ] Ms.

Mirakova presented in evidence an email from Ms. Zinovina in Russian dated January 20, 2014, which she translated as follows: Dear Marina, business in which you invested your money closed. I lost too. Edward didn’t answer on my calls and emails. I couldn’t help you, sorry me, if you can. Best Regards, Tatyana. [ 15 ] Although the trial judge had advised at the beginning of the trial that this method of translation was not acceptable, Ms. Mirakova’s translation was allowed as evidence. [ 16 ] Ms.

Mirakova testified that she responded with an email asking what business she was talking about, which she translated herself from Russian. [ 17 ] Ms. Zinovina was asked whether she had any questions of Ms. Mirakova and she said she did not, that she just wanted “to tell ...”, at which point she was cut off from the rest of her answer.

[ 18 ] Ms. Mirakova’s agent led Ms. Mirakova’s husband through evidence that he had been present on June 30, 2012 when money was given to Ms. Zinovina. He also testified that: And I talking that ... with Tatyana and said, Tatyana, I now only you, in give money only you. And you – we’ll be guarantor, its money. Tatyana said me, I understand. It’s okay. Q. So she agreed to personally guarantee this money? A. Yeah, yeah. ... Q. Okay. So she --- is it my understanding, she was going to personally ensure pay back? A. Yeah. Yeah, it’s money ... it’s money. [ 19 ] From the transcript, it appears that Ms.

Mirakova was trying to prompt her husband at times, and it is also clear that his English language skills are poor. [ 20 ] Ms. Zinovina did not question this witness. [ 21 ] Finally, Ms. Mirakova’s daughter was called to testify that she recalled being present at a meeting in June, 2012 when Ms. Zinovina asked her parents to lend money to her. She testified that she recalled another visit in October, 2012 where Ms. Zinovina said “the money will, of course, be returned, and that she will presumably return the money if something happens, yes”. Ms. Zinovina did not cross-examine this witness. [ 22 ] Ms.

Zinovina then testified that she was only a witness to the promissory note, that she had nothing to do with Boetec, and she didn’t understand why she was included in the claim. The trial judge asked whether she had anything to say in response to what the witnesses had said, and Ms. Zinovina repeated that she was a witness when Mr. Boldt got the money, that it was $10,000, not $30,000, and that it was given to Mr. Boldt. She said she was a witness to that, and later a witness to “when they signed the paper later on”. [ 23 ] Ms. Mirakova’s agent attempted to cross-examine Ms.

Zinovina, but was warned off by the trial judge. Some of the questions may have clarified Ms. Zinovina’s defence, but the trial judge eventually discouraged the agent from proceeding with cross-examination, clearly on the basis that it could do Ms. Mirakova’s case no good. III. Fresh Evidence Application [ 24 ] Ms. Zinovina filed an affidavit in support of her application for a trial de novo. She provided several emails from Ms. Mirakova to Mr. Boldt which indicate on their face that Ms. Mirakova knew the loan was to Mr. Boldt and that support Ms.

Zinovina’s assertion that the loan pre-dated June, 2012 date and was actually made in 2010. Ms. Zinovina states in the affidavit that the original $10,000 loan worked its way up to $30,000 through general promissory notes signed by Mr. Boldt. When he failed to repay the original amount. Ms. Zinovina also provided evidence that she went to Spain in 2010, not 2012, casting some doubt on Ms. Mirakova’s testimony that the Spain trip followed a loan in 2012. IV. Applicable Law [ 25 ]

Section 51 of the Provincial Court Act , R.S.A. 2000, Ch. P-20 , provides that “an appeal is to be heard as an appeal on the record unless, on the application of a party, the Court of Queen’s Bench orders the appeal to be heard as a trial de novo .” [ 26 ] The Act gives no guidance as to the basis for the Court to make such an order. However, in Rezources Inc. v Gift Lake Development Corp ., 2008 ABQB 254 (Alta.

Q.B.), Graesser, J. concluded that trials de novo should be ordered only in rare circumstances, having regard to the degree of deference owed to the Provincial Court Judge who has presided over the trial and seen and heard the witnesses. As well, he noted that cost consequences are significant, and Provincial Court trials should not be viewed as a “trial run” (at para. 34). [ 27 ] The onus in on the appellant to satisfy the Court that there are good and sufficient reasons to order a trial de novo .

The trial in Provincial Court must be demonstrated to be unsatisfactory in some material aspect, which may have affected the outcome. Where new evidence is the basis for the application, the fresh evidence rule should at a minimum be considered: Gill v Sandhu , 1999 ABQB 209 (Alta. Q.B.); Rudy Hetu Logging Inc. v Greyback Logging Ltd ., 2012 ABQB 15 at para. 6 . [ 28 ] The fresh evidence rule stipulates that fresh evidence is not accepted unless:

a) it could not, with the exercise of due diligence, have been produced at trial;

b) it is relevant;

c) it is capable of belief; and

d) if believed, it could reasonably have affected the result of the first hearing if it had then been heard, an assessment that takes into consideration the other evidence at that hearing. [ 29 ] As noted in Gill and in Rudy Hetu Logging , the standard of diligence should not be set too high in these kinds of applications,

having regard to the

summary and less formal nature of small claims proceedings, which generally proceed without discovery of documents or parties. [ 30 ] In this case, the trial in Provincial Court was unsatisfying for a number of reasons:

a) Ms. Mirakova was allowed to proceed on the basis of a theory of the case that was not outlined in the Civil Claim, and in fact contradicted the initial claim. The trial judge recognized this early on in the proceedings, but allowed the trial to proceed at any rate.

b) The trial judge, understandably, attempted to guide Ms. Mirakova’s agent, who was doing a poor job of leading evidence. Unfortunately, for reasons that are not clear and may have related to the pressure of time, similar guidance was not given to Ms. Zinovina. The trial judge did give her the opportunity to cross-examine witnesses and to expand her evidence, but did not urge that upon her, as he did with Ms. Mirakova’s agent. It is clear from the transcript that the trial judge was doing his best to have the evidence presented properly and fairly, but he may not have appreciated Ms.

Zinovina’s failure to recognize that, given the different direction the claim had gone, she needed to do more than just address the promissory note.

c) While the trial judge tried hard to control her, Ms. Mirakova’s agent led evidence on the major issues, and failed to substantiate key evidence with documents. [ 31 ] With respect to the fresh evidence sought to be adduced by Ms. Zinovina:

a) given that she could not have anticipated the revised version of the claim put forth at trial, she could not have been expected to have the emails and passport evidence now provided in her affidavit prepared for trial. She was taken by surprise, and therefore does not fail the first part of the fresh evidence test;

b) the evidence is relevant to key issues in the case;

c) it is capable of belief; and

d) if believed, it could reasonably have affected the result of the trial. [ 32 ] The trial judge relied primarily on the credibility of Ms. Mirakova and her family members. The fresh evidence casts doubt on that credibility. [ 33 ] As was the case in Gill , and for many of the same reasons, justice requires that Ms. Zinovina be allowed to present evidence on the claim without surprise, and that she be allowed to argue a limitations defence if her version of events is accepted. [ 34 ] I therefore direct that this appeal be conducted by trial de novo . Costs will be in the cause.

Heard on the 15 th day of April, 2016. Dated at the City of Calgary, Alberta this 25 th day of April, 2016. B.E. Romaine J.C.Q.B.A. Appearances: Jeffrey B. Woodruff for the Appellant Michael C. Kwiatkowski for the Respondent