2016 QCCA 268, 2016 QCCA 268

Hagan c. Westboro Mortgage Investment Corp. 2016 QCCA 268 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No: 500-09-025777-152 (550-17-008414-151) DATE: February 11, 2016 IN THE PRESENCE OF THE HONOURABLE MARK SCHRAGER, J.A. CAROLYN HAGAN APPLICANT – Impleaded party 6379800 CANADA INC. APPLICANT – Defendant v. WESTBORO MORTGAGE INVESTMENT CORP. RESPONDENT – Plaintiff JUDGMENT [ 1 ] Applicants seek leave to appeal certain conclusions of the interlocutory judgment of the Superior Court, District of Gatineau (the Honourable Pierre Dallaire) of November 12, 2015.

The judge received Applicants’ motion in revocation of judgment and at the same time issued two safeguard orders from which leave to appeal is sought. [ 2 ] Before addressing the substance of the matter, it should be mentioned that the motion for leave to appeal was served on December 15, 2015 and when presented on January 20, 2016, was postponed because Applicants’ attorney announced that he would cease representing. In answer to the notice to appoint new attorneys, Applicant, Carolyn Hagan, has appeared on her own behalf and for the corporate Applicant. The latter appearance is not valid because

article 61 C.C.P. (article 87 of the new C.C.P. ) provides that a corporation must be represented by an attorney. Mrs. Hagan is not an attorney. Nevertheless, she informed the Court that the corporation’s representations were the same as hers. Moreover, the grounds for leave are in writing in the motion as prepared by her previous attorney. [ 3 ] In the Superior Court, Respondent had obtained judgment by default to appear against corporate Applicant, condemning it to surrender a certain immoveable property pursuant to a deed of hypothec.

Service of the proceedings was effected at the Court House and Applicants claimed that they were unaware of the proceedings. Accordingly, Applicants seek the revocation of the judgment of surrender in first instance. Upon receiving the motion in revocation, Justice Dallaire suspended execution of the judgment. He added two safeguard orders, which are the subject of the Application for leave to appeal before me.

These safeguard orders can be described as follow: 1) ordering corporate Applicant to allow Respondent to inspect the building once per month while the revocation proceedings are pending; and 2) ordering corporate Applicant to deposit monthly with Respondent’s attorney, in trust, $8 990 while the proceedings in revocation are pending. [ 4 ] The rationale for the first order is obvious and for the second order, the rationale is based on the grounds of defence put forward in the application for revocation i.e. Respondent had agreed with Applicants to the renewal of the hypothecary loan.

The amount of $8 990 is the amount of the monthly loan repayments that would be due if the loan had been renewed. Justice Dallaire remarked that Applicants’ attorney did not object to the proposed safeguard orders.

However, Applicant Hagan now refutes that position. [ 5 ] Applicants allege manifest errors in the assessment of the proof by Justice Dallaire given that there was no consent to the safeguard orders, contrary to the judge’s comments. [ 6 ] Applicants also allege errors of law in that the judgment contains no analysis of the criteria applicable to the issuance of a safeguard order such as a prima facie right, serious or irreparable harm and the balance of inconvenience. [ 7 ] Applicants add that there is no prima facie right to the monthly payments since Respondent denies that the loan was renewed.

Applicants further argue that it was incorrect for the judge to subject the contestation of the hypothecary proceedings to the satisfaction of the safeguard order. [ 8 ] The granting of leave to appeal safeguard orders, as interlocutory judgments, is subject, in this instance, to

article 29 C.C.P. Such leave is granted only in exceptional circumstances because the nature of the safeguard orders is such that they often do not satisfy the criteria of

article 29 C.C.P. because final judgment can remedy the situation, which is the case at hand.

[ 9 ] The payments here in question would be due, if Applicants were correct that the loan was in fact renewed. The safeguard orders provide that the money be remitted to Respondent’s attorney in trust so that if Respondent is correct and there is no loan then the funds could be recovered by Applicants. [ 10 ] That Justice Dallaire declared that Applicants would be foreclosed from contesting the hypothecary proceedings if the safeguard orders were not respected does not appear to be an order which falls under

article 29 C.C.P. An additional judgment actually declaring foreclosure or dismissal of proceedings would be required. [ 11 ] Even if the criteria of

article 29 C.C.P. for leave to appeal were satisfied, I would not grant leave in this case because I am of the opinion that the interest of justice does not require that leave be granted, the whole as provided by

article 511 C.C.P. [ 12 ] The orders are limited in time and result from the exercise of discretion of the motion judge, which in all the circumstances, appears to have been exercised reasonably, [1] even if the judge did not articulate each of the analytical steps required for the issuance of the safeguard orders. FOR ALL THESE REASONS, THE UNDERSIGNED: [ 13 ] DISMISSES the motion for leave to appeal (requête pour permission d’appeler d’un jugement interlocutoire) dated December 15, 2015. [ 14 ] THE WHOLE with legal costs. MARK SCHRAGER, J.A. Carolyn Hagan Personally 6379800 Canada inc. Not represented Mtre Pierre Leduc LEDUC ISABELLE For Respondent Date of hearing: February 10, 2016