Swedlo et al. v. Swedlo, 2010 MBCA 114

Citation: Swedlo et al. v. Swedlo, 2010 MBCA 114 Date: 20101208 Dockets: AI 10-30-07314; AI 10-30-07315 IN THE COURT OF APPEAL OF MANITOBA Coram: Madam Justice Freda M. Steel Mr. Justice Martin H. Freedman Mr. Justice Richard J. Chartier B E T W E E N: DIANNE SWEDLO and ) ARNOLD SWEDLO ) ) J. G. E. Young (Plaintiffs) Appellants ) for the Appellants - and - ) ) KRIS SWEDLO ) ) C. L. Dunn (Defendant) Respondent ) for the Respondent ) I. Y. Y.

Chen ) A N D B E T W E E N: ) ) KRIS SWEDLO ) Appeals heard: ) September 22 and (Applicant) Respondent ) November 29, 2010 ) - and - ) ) INGRID YING YU CHEN ) Decision pronounced: ) November 29, 2010 (Respondent) Respondent ) ) - and - ) ) Written reasons: TIEN MING CHEN and CHAO CHEN ) December 8, 2010 ) (Respondents) ) CHARTIER J.A. 1 The sole issue on these two appeals is whether the motions judge erred in refusing to pay out certain sale proceeds to Dianne Swedlo and Arnold Swedlo (the Swedlos) from funds currently being held in trust. On January 19, 2009, the motions judge ordered, amongst other things: 6.

THIS COURT FURTHER ORDERS that the Certificates of Judgment registered as instrument nos. 3419146 and 3546350 by Dianne Swedlo and Arnold Swedlo shall be discharged and/or vacated and removed and that the said Judgments shall be paid from the half-share of the Applicant, Kris Swedlo, to be held in an interest-bearing trust account pending a final determination or further order of the Court or written agreement between the parties respecting the allegations of fraud by the Respondent, Ingrid Yin[g] Yu Chen. 7.

THIS COURT FURTHER ORDERS that the Respondent, Ingrid Yin[g] Yu Chen, shall file and serve any motion for leave to

intervene within civil actions CI07-01-50397 and CI07-01-53705 to set aside the Certificates of Judgment registered as instrument nos. 3419146 and 3546350 in favour of Arnold Swedlo and Dianne Swedlo by February 4, 2009, failing which the said Judgments shall be paid out and shall not be required to be held in the trust account as referred to in paragraph 6 above. 2 No appeal was taken from that decision. 3 Pursuant to the aforementioned para. 7, Ingrid Ying Yu Chen (Chen) moved to intervene within the allotted time. She asserted the right to intervene on the ground that there had been fraudulent conveyances.

Her motion was dismissed by the Senior Master, who found that she had failed to “put forward any meritorious evidence of fraud.” He directed the matter be brought back before the motions judge for a determination as to whether the funds could be released. Chen never appealed the Senior Master’s decision . 4 When the matter came before the motions judge on August 31, 2009, she held that the funds should not be released because there had not been a final determination with respect to the fraud allegations in the family proceedings. 5 The Swedlos argue that the motions judge erred in so doing.

They submit that because the requirements stipulated at para. 7 of the order had been fulfilled (which order had not been appealed), it therefore followed that the monies should be released. Chen submits that the motions judge’s decision of August 31 was an exercise in judicial discretion and that appellate intervention is unjustified. 6 We agree with the Swedlos. 7 In our view, the motions judge’s decision to dismiss the Swedlos’ request to pay out the funds to them was not the product of the exercise of judicial discretion, but rather occurred because of an error in law .

Discretion only exists if the judge has available before her a choice of more than one alternative. The basis for a discretionary decision will originate either from a legal or factual foundation. 8 In this case, neither one existed. The legal boundaries had been set by para. 7 and the factual underpinning had been determined by the Senior Master. Clearly, the requirements of para. 7 had been met. There was no element of choice left for the judge: the funds were to be released to the Swedlos if Chen’s motion for intervention failed. 9 Moreover, the effect of the August order was to stay the January order.

However, while the ordering of a stay is an exercise in discretion, it must be based on certain well-known criteria, an arguable case, irreparable harm and balance of convenience. In this case, there was no evidence of an arguable case or irreparable harm. 10 The appeals are granted. 11 On the issue of costs, our order is for only one set of costs. However, in light of the Swedlos’ failure to file the amended notice of appeal, as we ordered at the September 22 hearing, the costs in favour of the Swedlos will only be for half of the allowable costs. __________________________ J.A.

I agree: __________________________ J.A. I agree: __________________________ J.A.