2016 QCCQ 1128, 2016 QCCQ 1128

Salehi c. Laferrière Gravel et Associés, Notaires 2016 QCCQ 1128 COURT OF QUEBEC Small Claims Division CANADA PROVINCE OF QUEBEC DISTRICT OF MONTREAL Civil Division No: 500-32-141179-137 DATE: February 1, 2016 ______________________________________________________________________ BY THE HONOURABLE JEFFREY EDWARDS, J.C.Q. ______________________________________________________________________ FARHAD SALEHI -and- ANICK BÉRARD Plaintiffs v.

LAFERRIÈRE GRAVEL ET ASSOCIÉS, NOTAIRES Defendant ______________________________________________________________________ JUDGMENT (Revised transcription of reasons expressed verbally) ______________________________________________________________________ [ 1 ] Plaintiffs Farhad Salehi and Anick Bérard claim the amount of $7,000 against Laferrière Gravel et Associés, a firm of notaries, on the basis of professional fault and liability resulting from Defendant’s representative Maître Francine Lewis’ omission to reveal to them the existence of a servitude (which Plaintiffs refer to as an encroachment) on the extremity of the residential property purchased by Plaintiffs.

Plaintiffs Farhad Salehi and Anick Bérard have also instituted separate proceedings against their sellers in the transaction on the ground of the undisclosed servitude and on other grounds (500-32-141176-133). The two claims were set down for hearing on the same morning.

The Court heard both claims together as they involved in part the same facts. [ 2 ] Farhad Salehi and Anick Bérard state that Me Lewis did not tell them about the existence of the servitude until after the closing of the sale transaction, which occurred on December 22, 2010. [ 3 ] Me Lewis raised several grounds of defence to the claim. [ 4 ] First, Me Lewis states that the Promise to Purchase indicates that the documents (including the Certificate of Location) are in the possession of Plaintiffs (Exibit P-9 (file no. 500-32-141176-133), clause 6.4).

The Certificate of Location indicates the presence of the servitude. However, the Court concludes that, upon a review of the paragraph in question, it only states that the title documents “in the possession” of the seller will be given to the purchasers. In any event, Defendant had the obligation to ensure that Plaintiffs were informed of the existence of the servitude. [ 5 ] Second, Me Lewis states that she in fact discussed and reviewed the servitude issue with Plaintiff Farhad Salehi and obtained his permission to proceed nonetheless to the sale on the basis of obtaining title insurance.

This is denied by Farhad Salehi. Me Lewis refers to notes on her file folder (Exhibit D-5) indicating that on December 14, 2010 a conversation took place with the buyers, the sellers and the bank on the issue. It is to be noted that the annotation is general and there is only one entry for all three calls. It may be that a call was made to one and not to the others. Given the testimony of Plaintiff and the voluminous documentation and e-mails contemporaneous to the events, sent to Me Lewis after the sale, the Court concludes that the preponderance of the proof (

Article 2804 of the Civil Code of Quebec (“ C.C.Q. ”)) on this point supports Plaintiff Farhad Salehi’s version that no such call was made to him by Me Lewis or that in any event, he was not advised at that time of the servitude. [ 6 ] Third, Me Lewis states that, at the time of the closing of the residential sale transaction on December 22, 2010, in the presence of the sellers, she explained the servitude issue to the parties and to Farhad Salehi and Anick Bérard and that the title insurance had been obtained to cover any risk in that regard.

[ 7 ] Both Farhad Salehi and Anick Bérard emphatically deny that such a disclosure occurred at that time and state instead that the existence of the servitude was only revealed to them in a subsequent meeting with Me Lewis immediately after the closing meeting and after the sellers had left the meeting.

In their testimony before the Court, the sellers also state that they have no recollection of Me Lewis going over the servitude issue or discussing the content of the Certificate of Location during the closing meeting. [ 8 ] The version of events of Farhad Salehi and Anick Bérard is made clear in detailed e-mail exchanges and letters sent to Me Lewis after the sale and after the title issue was discussed (Exhibits P-2, P-4; see also documents of D-7).

At that time, Me Lewis did not counter those statements and did not say that she had raised the servitude and explained the content of the Certificate of Location with Farhad Salehi and Anick Bérard before or during the closing meeting.

In light of the proof and testimony heard, the Court concludes that the preponderance of the proof favours the version of Farhad Salehi and Anick Bérard that no timely disclosure, namely one before the signature of the Deed of Sale by Farhad Salehi and Anick Bérard, was made by Me Lewis. [ 9 ] Fourth, Me Lewis states that the specific terms of the servitude (Exhibit D-3) provides for a tolerance for the existing use made by Farhad Salehi and Anick Bérard, namely a surface stone path around the pool of the property. Therefore, Me Lewis argues that Farhad Salehi and Anick Bérard have suffered no damages.

Upon review of the terms of the servitude, it is true that certain stone materials are tolerated. However, the tolerance appears to be for alleys or walkways regarding the driveway (“des allées de garage”) and not for a surface path around the pool. So there does remain an ambiguity and a potential title issue for existing use. [ 10 ] Fifth, Me Lewis states that since title insurance (Exhibit D-1) has been obtained in the event that the holder or beneficiary of the servitude, namely Bell Canada, would seek to exercise or enforce the servitude, Farhad Salehi and Anick Bérard will suffer no damages from this issue.

That is potentially true. The insurance cost (approximately $600) was paid, according to Me Lewis, by the sellers. But Farhad Salehi and Anick Bérard will have to disclose this title issue to future buyers. Some potential buyers may be content with title insurance to cover the risk. However, others may not be. So it is probable that there would be some potential loss of value to the property as a result of the existence of the servitude.

It may be nominal or it may not be. [ 11 ] However, there was no admissible, verifiable and independent proof before the Court as to the loss of value caused by this title issue. [ 12 ] Farhad Salehi and Anick Bérard attempted, at the morning of the trial, to produce a letter from a real estate broker regarding such potential loss of value. That document was not communicated to Me Lewis or to the Sellers who objected to its filing on the basis that it took them by surprise.

The Court’s Notice of Convocation in the Court Record states as follows: “Vous devez deposer au moins quinze (15) jours avant la date fixée pour l’audience vos documents, declarations ou rapports qui ne l’ont pas encore été”. Farhad Salehi and Anick Bérard were therefore advised that they had to file documents into the Court record before 15 days from trial. This would have allowed the sellers and Me Lewis to be made aware of it and react accordingly (for example, counter-proof, witnesses). Farhad Salehi and Anick Bérard did not do so with regard to this document.

Nor did they bring down to Court or have a subpoena issued to the real estate broker who was the declared signatory of the document.

Me Lewis and the sellers objected to its production for the reasons that it was tardy and last minute, that it took them by surprise, that they were unable to cross-examine the signatory of the letter given his or her absence and finally that they had no opportunity to make their own proof in that regard, namely, the absence of loss of value. [ 13 ] On the basis of these objections and of procedural fairness and equity and in light of the fact that Plaintiffs had between the closing of the transaction and the Court hearing approximately five years to obtain and then file into the Court record proof of loss of value, the Court did not allow production of that document. [ 14 ] Sixth, Me Lewis states that the claim against her is prescribed by

Article 2925 C.C.Q. As the Plaintiffs were aware of the title issue from at least the closing on December 22, 2010, Me Lewis states that Farhad Salehi and Anick Bérard were obliged to institute proceedings within 3 years, namely by December 22, 2013. Plaintiffs said they put off filing proceedings because they were waiting for the outcome of a disciplinary complaint filed against one of the sellers who was a real estate agent. The Plaintiffs referred to no legal

article which would justify an extension beyond December 22, 2013. In light of this ground of defence of Me Lewis, Plaintiffs’ claim appears prescribed.

[ 15 ] Me Lewis also had other grounds of defence such as the alleged illegal division of the claim of Plaintiffs by suing her and the sellers for separate amounts for the same damages (Paragraph 9 of the Defence of Me Lewis:

Article 538 of the Code of Civil Procedure ;

Article 955 of former Code of Civil Procedure ) and that such division makes the claim against her inadmissible before the Small Claims Division of the Court of Quebec. [ 16 ] In light of Me Lewis' argument on prescription, the Court need not further examine the other grounds of defence of Defendant, nor determine the amount of damages, if any, resulting from the omission of Me Lewis to disclose the servitude. [ 17 ] In light of the circumstances, the Court will not award judicial costs.

FOR THESE REASONS, THE COURT: DISMISSES Plaintiffs Farad Salehi and Anick Bérard’s claim against Defendant Laferrière Gravel et Associés, Notaires; WITHOUT COSTS . __________________________________ Jeffrey Edwards, J.C.Q. Date of hearing: February 1, 2016