2011 NBCA 32, 2011 NBCA 32

COURT OF APPEAL OF NEW BRUNSWICK 92-10-CA 2063010 ONTARIO INC. c.o.b. AGENT’S EQUITY APPELLANT 2063010 ONTARIO INC., faisant affaire sous laraison sociale AGENT’S EQUITY APPELANTE - and - - et - DERRICK BARR, DAVID CURREN, SHEILAHENRY, HEATHER LEBLANC, AMANDAMcCONNACHIE, PAUL McCRACKEN, JUDYMITCHELL, BOB MOWERY, SUSAN MOWERY,JAKE PALMER, MARCUS POWER and MARIAYOUNG RESPONDENTS DERRICK BARR, DAVID CURREN, SHEILAHENRY, HEATHER LEBLANC, AMANDAMcCONNACHIE, PAUL McCRACKEN, JUDYMITCHELL, BOB MOWERY, SUSAN MOWERY,JAKE PALMER, MARCUS POWER et MARIAYOUNG INTIMÉS 2063010 Ontario Inc. (c.o.b. Agent’s Equity) v.

Barret al., 2011 NBCA 32 2063010 Ontario Inc. (faisant affaire sous la raisonsociale Agent’s Equity) c.

Barr et al., 2011 NBCA 32 CORAM: The Honourable Justice Turnbull The Honourable Justice Robertson The Honourable Justice Richard CORAM : L’honorable juge Turnbull L’honorable juge Robertson L’honorable juge Richard Appeal from 3 decisions of the Court of Queen’sBench: May 28, June 11 and 18, 2010 Appel de trois décisions de la Cour du Banc de laReine : Les 28 mai, 11 juin et 18 juin 2010 History of Case: Historique de la cause : Decisions under appeal: 2010 NBQB 181 2010 NBQB 208 2010 NBQB 243 Décisions frappées d’appel : 2010 NBQB 181 , 2010 NBBR 181 2010 NBBR 208 2010 NBBR 243 Preliminary or incidental proceedings: N/A Procédures préliminaires ou accessoires : S.O.

Appeal heard: January 20, 2011 Appel entendu : Le 20 janvier 2011

Judgment rendered: April 14, 2011 Jugement rendu : Le 14 avril 2011 Reasons for judgment by: The Honourable Justice Robertson Motifs de jugement : L’honorable juge Robertson Concurred in by: The Honourable Justice Turnbull The Honourable Justice Richard Souscrivent aux motifs : L’honorable juge Turnbull L’honorable juge Richard Counsel at hearing: For the appellant: Richard J. Scott, Q.C. For the respondents Matthew R. Letson Avocats à l’audience : Pour l’appelante : Richard J. Scott, c.r. Pour les intimés : Matthew R. Letson THE COURT The appeal is allowed.

All of the motion judge’s orders are set aside and all the motions are dismissed. Agent’s Equity is entitled to costs in this Court and in the court below. Costs are fixed at $300 per respondent. LA COUR L’appel est accueilli. Toutes les ordonnances du juge saisi de la motion sont annulées et toutes les motions sont rejetées. Sont accordés à Agent’s Equity les dépens devant notre Cour et devant le tribunal dont appel est interjeté. Ils sont fixés à 300 $ pour chaque intimé. The judgment of the Court was delivered by ROBERTSON, J.A. I.

Introduction [ 1 ] This case concerns the enforceability, in New Brunswick, of a judgment obtained, in Ontario, by the appellant, 2063010 Ontario Inc., carrying on business as Agent’s Equity. The judgment was obtained against 20 individuals, including the 12 respondents who had been engaged as licensed real estate agents, in Saint John, with the brokerage firm of Mawhinney Real Estate (“Mawhinney”). For a fee, Agent’s Equity advanced monies to the respondents on the basis of commissions to be earned from sale transactions which had yet to close.

For example, Agent’s Equity would advance $2,300 on a $2,600 commission to be paid on a sale transaction that would close in 90 days. On the closing date, it was expected that Agent’s Equity would be paid $2,600. Otherwise, interest at 18% per annum would begin to accumulate. [ 2 ] The exact terms of the contractual arrangement were placed in “Commission Sale Agreements”. The

respondent agents expressly agreed that the advances would be paid directly into the broker’s trust account, yet they did not receive any of the advances from Mawhinney. Nevertheless, the agents remained contractually bound to repay Agent’s Equity. They failed to do so and Agent’s Equity instituted legal proceedings in Ontario. Service of the Statement of Claim was effected on the individual agents in New Brunswick, but they chose not to defend the proceedings. Subsequently, default judgment was entered against them.

In turn, the Ontario judgment was registered as a judgment of the New Brunswick Court of Queen’s Bench, pursuant to the Canadian Judgments Act , S.N.B. 2000, c. C-0.1. Consequently, the judgment became a lien against the assets of the respondents under the Land Titles Act , S.N.B. 1981, c. L-1.1, and the Personal Property Security Act , S.N.B. 1993, c. P-7.1.

The amount of the default judgment, as against each of the respondent agents, ranges from a low of $1,900 to a high of $8,200. [ 3 ] By Notice of Motion, the respondents, Bob and Susan Mowery, applied under s. 10(2) of the Canadian Judgments Act to have the Ontario judgment set aside or, in the alternative, that it be stayed or enforcement be limited pursuant to s. 10(1), or, in the further alternative, that it be held unenforceable by operation of the provisions of the Employment Standards Act , S.N.B. 1982, c. E-7.2.

The other respondents had filed motion documents with the Court, based on the Mowerys’ documentation, seeking the same relief. During the motion hearing, the judge identified another issue: whether the default judgment was registerable in New Brunswick because of s. 5(2)(

a) of the Canadian Judgments Act . That

section states that a judgment made in a proceeding in which the judgment debtor did not take part shall not be registered if the judgment was made in a proceeding against an individual resident in New Brunswick to enforce “a contract for the supply of consumer goods or services within New Brunswick”.

The motion judge asked whether the Commission Sale Agreements qualified as contracts for the supply of a consumer service. [ 4 ] Ultimately, the motion judge ruled the Commission Sale Agreements qualified as contracts for the supply of a consumer service and, therefore, the default judgment was not registerable in New Brunswick. The judge reasoned that the contractual arrangement more closely resembled a form of consumer financial service than a business transaction.

In reaching that determination the judge focused in on the cost of the short-term advance, having regard to the amount of the fee charged, which translated into effective annual interest rates ranging from 50% to 217%. The motion judge also awarded costs of $750.00 to both Bob and Susan Mowery and costs of $500.00 to each of the remaining self-represented litigants. The motion judge then granted an injunction barring Agent’s Equity from initiating any legal proceeding in any court in New Brunswick with respect to the unpaid advances until such time as Agent’s Equity complied with his costs orders.

Correlatively, the judge stayed any proceedings that may have been commenced, in New Brunswick, by Agent’s Equity pertaining to the underlying Commission Sales Agreements. [ 5 ] In my respectful view, the appeal must be allowed and the orders granted below set aside. In effect, the motion judge perceived the effective annual interest rate to be a usurious rate of interest and, therefore, objectionable or unenforceable as an unconscionable transaction at law. This is where the motion judge began his descent into error.

The fact that one agrees to pay what is considered a usurious rate of interest does not automatically render the transaction unconscionable. The notion of inequality of bargaining power must be factored into the legal framework and there is no evidence of an inequality as between the parties. Indeed, the respondent agents stated in their supporting affidavits that they were “compelled” to sign the Agreements at the insistence of Mawhinney. If there were an inequality of bargaining power, it would be between the agent and Mr. Mawhinney. More importantly, the purpose of s. 5(2)(

a) of the Canadian Judgments Act is not to prevent the registration of default judgments obtained in regard to consumer transactions that might be unenforceable under the doctrine of unconscionability. The true object of the provision is to force vendors and service providers who are dealing with non-business consumers in New Brunswick to sue in New Brunswick.

It is unrealistic to expect this type of consumer to defend a lawsuit brought in another province, particularly when the amount involved may be relatively small. [ 6 ] This Court must provide a practical framework for deciding what is a contract for the supply of a “consumer service” which is consistent with the legislative objective underscoring s. 5(2)(

a) of the Canadian Judgments Act . To that end, the analysis is premised on the fact that we are dealing with a “financial service” involving the advance of monies. Ultimately, I settle on a framework that looks to see whether the purchaser/consumer of the service entered into the contract as part of, or in furtherance of, a business enterprise.

In short, the Act is seeking to exclude business-to-business contractual relationships from the ambit of s. 5(2)( a ), while insulating the non-business consumer of a financial service from the impact of a default judgment obtained in another province with respect to a contract made in New Brunswick.

The question the court must ask in this case is “Did the respondents enter into contracts with Agent’s Equity in their capacity as non-business consumers (individuals) or as business consumers (real estate agents)?” Admittedly, this approach contrasts sharply with the approaches adopted under the Personal Property Security Act and the Consumer Product Warranty and Liability Act , S.N.B. 1978, c. C-18.1 , in regard to the concepts of “consumer goods” and “consumer products”, respectively. The differences are explored in these reasons. II.

The Factual Matrix [ 7 ] In the real estate business, sales commissions earned by brokers and agents or sales representatives are usually earned upon the successful negotiation of an agreement of purchase and sale, but are not payable until the closing date of the transaction.

Recognizing that receipt of earned commissions is generally delayed and that agents and sales representatives may wish to access a portion of such commissions at an earlier date, Agent’s Equity offers a financial service to real estate professionals to enable them to “sell” their sales commission receivables before closing, thereby gaining immediate access to the money they have earned. Agent’s Equity deals exclusively with licensed real estate brokers and agents.

In order for an agent to take advantage of the financing offered by Agent’s Equity, the broker with whom the agent is associated must first open an account with Agent’s Equity. The agent may then request to open an account with Agent’s Equity. The relationship between Agent’s Equity and an agent with respect to the sale of a

portion of his or her earned real estate commission is governed by a Commission Sale Agreement between Agent’s Equity, the agent or sales representative, and the related broker. [ 8 ] On an approved transaction, Agent’s Equity will “purchase” up to 90% of the agent’s net receivable for his or her commission to a maximum of $10,000, up to 120 days before closing. Agent’s Equity charges an administrative fee of $34.50, on each commission purchased.

The commission receivable is purchased at a discount at a rate of $0.74 or $0.84 per thousand dollars advanced per day from the date of the net advance to the scheduled date of closing on the real estate transaction, with a minimum discount of $55. Recognizing that Agent’s Equity may not be repaid on the date of closing, a Reserve Fund deduction is also made from the advance calculated at 3% of the value of the gross commission purchased, plus $15.00.

If Agent’s Equity is repaid within twenty days of the closing date, the Reserve Fund amount is repaid to the agent on a pro rata basis. [ 9 ] A concrete example of how the fee structure works is instructive. On May 21, 2009, Agent’s Equity purchased a $2,650 commission that Mr. Mowery was to earn on a sale transaction to close on August 31, 2009. From that amount, Agent’s equity deducted $331.73 and paid into the trust account of Mawhinney the balance of $2,318.27. The deduction of $331.73 consisted of a fee of $34.50, a discount of $202.73 and a reserve fund amount of $94.50. On the closing date, Mr.

Mowery was required to refund the full amount of the advance. If he did so, the reserve amount of $94.50 would be refunded. In effect, the reserve fund is intended to provide Agent’s Equity with a buffer against bad debts. In the event Mr. Mowery failed to repay the advance on the specified date, the unpaid advance would attract an interest charge of 18% per annum . [ 10 ] There is one other aspect of the financial arrangement which is worthy of note.

The net advance can be made payable jointly to the sales representative and broker, solely to the sales representative, solely to the broker, or spilt between the sales representative and broker; all at the sales representative’s option. As well, there are options as to the method of payment. In the present case, each of the respondents signed a direction that required Agent’s Equity to pay each advance directly to the broker Mawhinney.

The record does not tell us why the respondents would agree to allow the broker to receive the proceeds from the Commission Sale Agreements while remaining personally liable to Agent’s Equity. [ 11 ] Mawhinney opened an account with Agent’s Equity as did a number of his sales representatives, including the respondents. Between May 21, 2009, and August 4, 2009, the respondents entered into twenty-three individual Commission Sale Agreements with Agent’s Equity with respect to the “purchase” from them of net commission receivables totalling $45,130.00.

Seven of the related transactions were to close in July 2009, fifteen in August 2009 and one on September 1, 2009. Mawhinney ceased operations in early August 2009. No payments were made to Agent’s Equity by either Mawhinney or the respondent agents in accordance with the terms of the Commission Sale Agreements. [ 12 ] Agent’s Equity instituted legal proceedings in Ontario by issuing one statement of claim, in order to collect the unpaid amounts owed to it under the Commission Sales Agreements. Service was effected on 20 agents, including Mawhinney and the 12 respondents, in New Brunswick.

All 20 chose not to defend the proceedings. Hence, default judgment was entered and costs of $300 were awarded against each defendant. The Ontario judgment was then registered as a judgment of the New Brunswick Court of Queen’s Bench pursuant to the Canadian Judgments Act . [ 13 ] The Notice of Motion was returnable on May 25, 2010. The Mowerys were self-represented. Following argument, the motion judge reserved his decision.

In reasons dated May 28, 2010, the judge identified an issue which the Mowerys had not raised: “whether the Ontario judgment against the Mowerys was made in a proceeding to enforce a contract for the supply of consumer goods or services within New Brunswick, a consumer financial service.” The judge adjourned the hearing and asked for further submissions. [ 14 ] A further hearing date of June 4, 2010 was set. On that date, Mel K. Norton advised those present he was now representing the Mowerys and filed a brief on their behalf. Having heard argument on the application of ss. 5(2)(

a) and 10(2)(

a) of the Canadian Judgments Act , the motion judge again reserved his decision. At the resumption hearing, held on June 11, 2010, the judge concluded the Ontario judgment enforced contracts for the supply of consumer financial services in New Brunswick and, hence, it was registered contrary to section 5(2)(

a) of the Act. Pursuant to s. 10(2)(

a) of the Act, the judge set aside the registration of the Ontario judgment in a decision reported at 2010 NBQB 181 , [2010] N.B.J. No. 178 (QL) . The motions with respect to the remaining respondents, and the matter of corollary relief and costs, were once again reserved to a later date: June 18, 2010. [ 15 ] The other respondents, as well as Lorne Daltrop and Paul O’Neil, had filed documents with the Court based on the Mowerys’ documentation seeking the same relief. Prior to the hearing on June 18, 2010, Mr. Daltrop and Mr.

O’Neil indicated they would not be proceeding further in the matter and, thus, no request for relief on their behalf was before the motion judge on that date. The other respondents, with the exception of Amanda McConnachie and Paul McCracken, only retained Mr. Norton to represent them on the morning of the June 18, 2010 hearing. Other than their Notices of Motion and supporting affidavits, the other respondents had filed

no other documents with the Court or made any other submissions. [ 16 ] On June 18, 2010, the motion judge allowed the relief requested in the Notices of Motion filed by the other respondents and awarded each of them costs in the amount of $500. Each of the Mowerys was granted costs of $750. The judge also granted unrequested consequential relief in the form of an order of prohibition against Agent’s Equity, all of which was intended to enforce Agent’s Equity’s obligation to pay costs. Agent’s Equity appealed. At the time of issuing the Notice of Appeal, Agent’s Equity listed Mr. Daltrop and Mr.

O’Neil as respondents. Having confirmed that neither of them was seeking relief at the motion hearing of June 18, 2010, Agent’s Equity discontinued the appeal against them. Subsequent to the June 18 hearing, the respondents, Amanda McConnachie and Paul McCracken retained Mr. Norton. III. The Motion Judge’s Decision [ 17 ] At the June 4 hearing, Mr. Norton argued that the monies advanced by Agent’s Equity were intended for consumption by the Mowerys for personal, family or household expenses.

He went on to emphasize the relatively small amounts of each advance ($1,300 to $2,300), the short period of the advance (16 to 103 days), the fact that Agent’s Equity was not a traditional source, the effective annual interest rates being charged (up to 217%) and, finally, that the obligation to repay the advance arose on the Mowerys’ de facto payday. In brief, Mr. Norton equated the entire arrangement to “payday loans”. In Smith v. National Money Mart Co. , [2007] O.J.

No. 46 (S.C.J.) (QL) , payday loans were described as “loans to consumers from non-traditional lending sources for small amounts of money, for a short term: usually until the borrower’s next payday” (para. 6). [ 18 ] Counsel for Agent’s Equity emphasized the commercial nature and legal underpinnings of the Commission Sales Agreements which effected a “sale” of a portion of a licensed real estate agent’s commission. Counsel maintained it was inappropriate to make an analogy with consumer financing contracts for household or personal purposes.

Counsel described the commercial activity of Agent’s Equity as that of a “factor” purchasing receivables from businesses in business-to-business transactions. Counsel went on to emphasize that Agent’s Equity only deals with brokers, and real estate professionals, who are independent contractors. Therefore, Agent’s Equity is not in the consumer trade in any capacity. [ 19 ] The motion judge’s analysis and reasoning are succinct ( see 2010 NBQB 208 , 363 N.B.R. (2d) 396 ).

He notes no one challenged his earlier calculations as to the effective annual interest rates with respect to the cost of the advances made by Agent’s Equity and relies on the Supreme Court’s decision in R. v. J.H.S ., 2008 SCC 30 , [2008] 2 S.C.R. 152 , for the proposition that Agent’s Equity is asking for the “triumph of form over substance” (para. 13). In two sentences, the motion judge rejects the notion that Agent’s Equity was acting as a factoring agent.

He ends his analysis with the following sentences: In my opinion the partial advances of commissions by Agent’s Equity at effective annual interest rates until closing from 36.23% up to 217.61% more closely resemble a form of consumer financial service than true business to business transactions. Thus I conclude the Ontario judgment against the Mowerys was to enforce contracts for the supply of consumer financial services within New Brunswick. [paras. 16 & 17] [ 20 ] At the June 18 hearing, the above reasoning was applied to the remaining motions.

It was at that time that he made his award of costs and issued a prohibition and stay order (see 2010 NBQB 243 ). III. Issues [ 21 ] This appeal involves two issues. First, it is alleged the motion judge erred in his

interpretation and application of section 5(2)(

a) of the Canadian Judgments Act , and, in particular, in concluding that the Ontario default judgment in question was to enforce contracts for the supply of a consumer service within New Brunswick. Second, it is submitted that in any event, the motion judge erred in awarding costs to the self-represented respondents. In light of my conclusion on the first issue, it is unnecessary to address the second. IV. The

Interpretation of Section 5(2)(

a) of Canadian Judgments Act

[22] In order to be registered in New Brunswick, a Canadian judgment (as defined in s. 1 of the CanadianJudgments Act) must meet the criteria set out in s. 5(1) of the Act. Section 5(2) sets out two exceptions with respect to the right to registerwhat amounts to a default judgment against an individual resident in New Brunswick. The first exception applies in cases where thedefault judgment relates to the enforcement of “a contract for the supply of consumer goods or services within New Brunswick”. No onequestions that Agent’s Equity was supplying financial services “within New Brunswick”.

What they cannot agree on is whether aCommission Sale Agreement qualifies as a contract for the supply of a consumer service within the meaning of s. 5(2)(a). [23] It is patently obvious that the motion judge was fixated on the rate of return which Agent’s Equity was able toextract from the respondents with respect to what most would classify as short-term loans. This is where the judge fell into error. We arenot dealing with the enforceability of unconscionable transactions tied to an agreement to pay what many might regard as a usurious rateof interest. We are dealing with the

interpretation of a statute, irrespective of the effective rate of return payable. In other words, theinterpretative issue would remain even if Agent’s Equity had charged a nominal fee for the financial service it made available to therespondent agents. The judge’s responsibility is to seek out the intent of the Legislature by applying the principles and rules of statutoryinterpretation. Judges are not judges without borders. They are not given an untrammelled authority to achieve what are perceived to bejust results.

The just result is the one that is reached after applying the tenets of the law in a principled and transparent fashion. [24] The interpretative question is easily stated: Do the contractual arrangements entered into between Agent’sEquity and the individual real estate agents qualify as contracts for the supply of a consumer service? Agent’s Equity takes the positionthat a contract for the supply of a consumer service refers to a contract for the supply of a service acquired for personal, family orhousehold purposes.

Correlatively, Agent’s Equity contends it is not the nature of the good or service that is determinative, but rather thepurpose for which the short-term advances were obtained. In other words, we must look to see what the monies advanced were used for -to pay for business or personal expenses? Agent’s Equity goes on to maintain that as the answer to this question is within the knowledgeof the person receiving the service, the onus is on the respondents to individually establish the purpose for which each of them enteredinto the Commission Sale Agreements.

As there is nothing in the record to show the monies advanced were not being used forcommercial or business purposes, Agent’s Equity submits the respondents cannot claim the benefit of the exception set out in s. 5(2)(a)of the Canadian Judgments Act. [25] The argument advanced above would have us define a contract for the supply of a consumer financial service interms of whether the monies advanced under the Commission Sale Agreements were used to pay for personal as opposed to businessexpenses.

The argument of Agent’s Equity goes one step further and would have us adopt a presumption that the monies were being usedto pay business expenses, that is to say, for commercial purposes. In my view, this interpretative approach must be rejected, even thoughit is one borrowed from another statutory scheme. Let me explain. [26] While s. 5(2)(

a) of the Canadian Judgments Act creates an exception for contracts for the supply of consumergoods as well as for the supply of consumer services, neither of those terms is defined in the Act and, therefore, it is understandable thatone would turn to other Legislative enactments which utilize those or similar concepts.

As Professor Sullivan explains in her oft-cited text, Sullivan and Driedger on the Construction of Statutes, 4th ed. (Markham: Butterworths Canada Ltd., 2002): “It is presumed that thelegislature uses language carefully and consistently so that within a statute or other legislative instrument the same words have the samemeaning and different words have different meanings” (p. 162). See also Soper v. Canada, (FCA), [1997] F.C.J. No.881 (QL), discussed in Sullivan at p. 336, dealing with the presumption of coherence between statutes.

Of course, the presumption ofconsistency or coherence is simply that, a presumption. Therefore, the same words used in one statute may have a different meaning inanother. [27] While the concept of “consumer service” is not found in any enactment of the Legislature of New Brunswick,the term “consumer goods” is defined in the Personal Property Security Act to mean “goods that are used or acquired for use primarilyfor personal, family or household purposes”.

A similar definition for the term “consumer product” is found in the Consumer ProductWarranty and Liability Act: “any tangible personal property, new or used, of a kind that is commonly used for personal, family orhousehold purposes”. This leads one to ask whether in law there is a substantive difference between the two terms.

The answer isprovided by Professor Catherine Walsh, in her text, An Introduction to the New Brunswick Personal Property Security Act (Fredericton:Faculty of Law, University of New Brunswick, 1995): The definition of “consumer goods” in the [Personal Property Security Act] differs from the analogous concept of “consumer product”used in the Consumer Product Warranty and Liability Act. Under the latter Act, characterization of a product as a “consumer product”depends on whether the goods are of a kind that are commonly used for personal, household or family purposes in the abstract.

Incontrast, the characterization of goods as “consumer goods” for the purpose of the PPSA turns on the actual subjective use to which theyare put by the debtor. If the goods are put to both a business and a personal use by the debtor, is it clear from the wording of thedefinition that it is the primary use that is determinative. [p.12] [28] In brief, the notion of “consumer goods” under the Personal Property Security Act focuses on the debtor’sactual use of the goods, while the notion of “consumer product” under the Consumer Product Warranty and Liability Act focuses on theuse of the product in the abstract.

Since s. 5(2)(

a) of the Canadian Judgments Act uses the term “consumer goods”, as does the Personal

Property Security Act, it is understandable that counsel for Agent’s Equity would argue that a contract for the supply of consumerservice under the Canadian Judgments Act should be measured in terms of how the respondent agents used the monies advanced byAgent’s Equity: there being a presumption that it was used for business purposes. The irony of this case is that the respondent agentsactually received nothing and, therefore, could not have used the monies for any purpose.

Ignoring that reality, the problem withfocusing on the agents actual use of the monies advanced is that Agent’s Equity has no objective way of knowing whether the moniesadvanced will be used for business or personal purposes. Hence, one is driven to look for another objective test, which takes us to theconcept of consumer product under the Consumer Product Warranty and Liability Act.

Instead of looking to the purchaser’s actual orintended use of the product, this test would have us look to the use of the product “in the abstract”. [29] There is a significant body of jurisprudence dealing with the concept of consumer product as defined under theConsumer Product Warranty and Liability Act. The law is clear. The intended use of the product is of no relevance to the question ofwhether it is a consumer product. So long as the product itself is one commonly used for personal, family or household purposes, itqualifies as a consumer product even if the product was purchased for commercial use.

Hence, the test is an objective one, at least to theextent that the judge is not to be influenced by the purchaser’s actual use of the product. For example, the purchase of a tractor trailer ortaxi will not be looked on as the purchase of a consumer good, irrespective of the purchaser’s actual or intended use of the vehicle.Hence, the question is whether the consumer product itself is the kind of product commonly or customarily used for personal, family orhousehold purposes. The lead decision in New Brunswick is Greene v. D.R. Sutherland and Sutherland (1982), (NBKB), 40 N.B.R. (2d) 27, [1982] N.B.J.

No. 182 (Q.B.) (QL), at paras. 8-12. See also Ivan Ivankovich, Consumer Products in NewBrunswick (1983), 32 U.N.B.L.J. 123. [30] By analogy, the above analysis leads one to ask whether the intended use of the monies, which Agent’s Equityadvanced to each of the respondents, should be relevant to the question of whether their financial arrangement qualifies as a consumerservice within the meaning of s. 5(2)(

a) of the Canadian Judgments Act. In my view, the answer has to be “no” if there is anotherframework or test which offers greater certainty in the law and to the parties. It makes no sense that Agent’s Equity’s right to register anOntario judgment in New Brunswick should hinge on the actual use of the monies advanced. Agent’s Equity has no way of knowing orcontrolling the use of the advances. Hence, our search for a workable definition of “consumer service” must continue. This takes us tothe respondent agents’ argument. [31] The respondents’ argument focuses on the presumed purpose of s. 5(2)(

a) of the Canadian Judgments Act.They describe the object of the exception as protecting those who are vulnerable due to a power imbalance as between consumers ofgoods and services and corporations which provide them. This inequality of bargaining power manifests itself in cases involving “paydayloans” for which the New Brunswick Legislature has passed the

An Act Respecting Payday Loans, 2008 c. 3 Bill 4, amending the Cost ofCredit Disclosure Act, S.N.B. 2002, c. C-28.3, into the Cost of Credit Disclosure and Payday Loans Act, which has yet to be brought intoforce. Briefly stated, that legislation regulates short-term payday loans granted to consumers who desperately need an infusion of cashprior to payday. Once again, the effective annual rates of interest being charged would qualify within the accountant’s definition ofusurious.

Admittedly, the analogy which the respondents draw between monies advanced under a payday loan and those advanced undera Commission Sale Agreement has some attraction. As a general proposition, I am prepared to infer that in normal circumstances theshort-term advances or loans would be treated by agents in a fashion similar to a payday loan even if the loan happened to cover some ofthe expenses incurred in their professional capacity as real estate agents.

However, the analogy fails for the following two reasons. [32] First, the analogy to payday loans fails because it is built on the mistaken premise that licensed real estateagents somehow lack equality of bargaining power, as is presumed with respect to those individuals who must resort to payday loans as amethod of obtaining short-term financing because they lack access to other conventional means of short-term financing. The same cannotbe said of real estate agents.

On the contrary, this group of professionals has familiarity with interest rate structures, rates of return and anintimate knowledge of the fundamentals of contractual principles governing both listing contracts and agreements of purchase and sale.This knowledge must also carry over to contracts such as Commission Sale Agreements.

It would be paternalistic for courts to equate thisgroup of consumers with workers who lack access to traditional financing sources (e.g., line of credit) and who are unable to sustainthemselves without access to an advance on their wages. [33] Second, the respondents, like the motion judge, identify the purpose of s. 5(2)(

a) of the Canadian JudgmentsAct as preventing judgment creditors from being able to enforce unconscionable contracts. With great respect, I do not believe theexception was crafted for that purpose. On reflection, it is the true consumer, that is to say, the non-business person or entity, who ismost unlikely to have the financial resources needed to defend a lawsuit brought by a plaintiff in another jurisdiction. The contract itselfmay be valid and the defendant may or may not have a valid defence to the action.

But the reality is that the individual who purchases aconsumer product or service is, for all practical purposes, powerless to defend the law suit. Even if the defendant purchaser possesses thefinancial resources to defend the lawsuit, the amount involved may be overshadowed by the cost of defending the action. In my view, thepurpose of s. 5(2)(

a) has nothing to do with the merits of the underlying action for which default judgment has been granted. Its purposeis simply to exclude the right to register default judgments obtained in other provinces with respect to those defendants who are residentin New Brunswick and who are least likely to be able to afford the cost of defending a lawsuit initiated in another province. That is why Iam unable to accept the respondents’ argument and understanding with respect to what is meant by a contract for the supply of aconsumer service.

[34] Having rejected the principal submissions of both parties, I am left to provide another framework or test forcircumscribing what contracts fall within the meaning of “a contract for the supply of a consumer service”. I begin with the fact that the“consumer service” we are dealing with is a “financial service”: one that involves an advance of monies with respect to what mostpersons would regard as a short-term loan. Typically, a financial service is offered to the general public, which includes both the businessconsumer and the non-business consumer.

In its narrow sense, the “true” consumer is the person contracting on his or her own behalf andnot for the purpose of advancing a business interest. Obviously, corporations and other legal entities carrying on business in NewBrunswick should not be able to shelter behind s. 5(2)(

a) of the Canadian Judgments Act. This is true so long as one accepts that thepurpose of that

section is to insulate the non-business consumer of a financial service from the impact of a default judgment obtained inanother province with respect to a contract made in New Brunswick. It is the non-business consumer who is most unlikely to defend alawsuit brought in another province, either because the consumer cannot afford to do so or because the legal cost would outstrip theamount involved. In

summary, there is a rational basis for concluding that the Act seeks to exclude business-to-business contractualrelationships from the ambit of s. 5(2)(a). [35] The above analysis leads one to ask whether the respondent agents were contracting with Agent’s Equity intheir capacity as non-business consumers (individuals) or as business consumers (real estate agents). The answer has to be businessconsumers. Agent’s Equity does not offer its financial service to the general public.

It deals exclusively with a group of informedprofessionals in the same way that other professionals might run their business with the assistance of a line-of-credit obtained from aconventional lending institution. The money advanced may well provide the members of the group with the means of paying forpersonal as well as business expenses. But that reality does not turn the financial arrangement into a contract for the supply of aconsumer service. But for the fact that the respondents were engaged in the real estate business, they would not have had access to thefinancial service which Agent’s Equity offers.

I accept its argument that s. 5(2)(

a) of the Canadian Judgments Act was not meant to applyto service contracts involving a business-to-business relationship but rather that of the business-to-consumer. In my view, this is the keyto understanding what is or is not included within the meaning of a contract for the supply of a consumer service. On the facts of thepresent case, we are dealing with a business-to-business relationship and that is why the respondents cannot successfully invoke s. 5(2)(a). This understanding of the supply of a consumer service is consistent with what I perceive to be the legislative purpose underscorings. 5(2)(

a) of the Canadian Judgments Act. As well, this understanding does not conflict with the approaches adopted under the ConsumerProduct Warranty and Liability Act or the Personal Property Security Act. Each Act has its own purpose. V. Conclusion and Disposition [36] Given my disposition on the merits of the appeal, it is unnecessary to deal with the motion judge’s award ofcosts to self-represented litigants, his order of prohibition and his stay against the appellant.

While the invalidity of the prohibition andstay orders is self-evident, the decision to award costs to self-represented litigants is governed by McNichol v. Co-Operators GeneralInsurance Company, 2006 NBCA 54, 298 N.B.R. (2d) 44, at para. 43; Proenca v. Squires Home Improvements & Total RenovationsLtd., 2001 NBCA 45, 252 N.B.R. (2d) 274, at paras. 19-21; Tibbetts v. Newman, 2005 NBCA 37, 283 N.B.R. (2d) 63, at para. 14;Skidmore v. Blackmore (BC CA), [1995] B.C.J. No. 305 (C.A.) (QL), at paras. 41 & 52 and Sherman v. Canada(Minister of National Revenue), 2004 FCA 29, [2004] F.C.J.

No. 136 (QL). [37] In conclusion, I hold the financial arrangement entered into between the appellant and the respondents, asevidenced by the Commission Sale Agreements, does not qualify as a contract for the supply of a consumer service within the meaningof s. 5(2)(

a) of the Canadian Judgments Act. Agent’s Equity does not offer its services to the general public, but only to an exclusivegroup of professionals involved the brokerage of properties. This contractual relationship therefore falls within the category of abusiness-to-business relationship and not that of business-to-consumer. Accordingly, the appeal must be allowed and the orders grantedby the judge set aside. The appellant is entitled to an order dismissing all of the motions and to an order for costs of $300 per respondent.The costs order in this Court embraces the costs that should have been awarded in the court below. ____________________________________ J.T. ROBERTSON, J.A. WE CONCUR:

____________________________________ WALLACE S. TURNBULL, J.A. ____________________________________ J.C. MARC RICHARD, J.A.