Grant Ohman Plaintiff v. Synq Access + Security Technology Limited, 2018 BCSC 1001

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Ohman v. Synq Access + Security Technology Limited, 2018 BCSC 1001 Date: 20180619 Docket: S187014 Registry: New Westminster Between: Grant Ohman Plaintiff And Synq Access + Security Technology Limited Defendant Before: The Honourable Mr. Justice Crawford Reasons for Judgment Counsel for the Plaintiff: R. Finlay Counsel for the Defendant: P.F. Waller Place and Date of Trial/Hearing: New Westminster, B.C. May 1, 2018 Place and Date of Judgment: New Westminster, B.C.

June 19, 2018 [ 1 ] The defendants seek: (1) an order to set aside a garnishing order before judgment that was issued on February 5, 2018; (2) an order to have any monies paid into court pursuant to that garnishing order paid to the defendant’s solicitor; and (3) an order for costs. [ 2 ] Mr. Ohman issued his Notice of Civil Claim on January 17, 2017. He claimed the defendant owed him $225,000 pursuant to a promissory note dated July 21, 2016, plus interest. [ 3 ] On April 11, 2017, the defendant filed its response. It said that it is in the business of developing and selling security systems.

They submit, in essence, that Mr. Ohman offered to put money into the company but then withdrew and has taken away trade secrets of the defendant. The defendant seeks damages against Mr. Ohman. [ 4 ] On September 14, 2017, the defendant sued Mr. Ohman and others in a separate action, seeking injunctions against the defendants, and made various claims for loss of business opportunity, breach of contract and damages. Sequence of Events [ 5 ] In support of the initial garnishee, Mr.

Ohman swore an affidavit on January 17, 2017, wherein he said that the indebtedness to him was $237,185.15 and costs. [ 6 ] In his affidavit, Mr.

Ohman swore that the actual amount of the debt claimed was $237,185.15 and that sum is justly due and owing by the intended defendant to the intended plaintiff after making all just discounts. [ 7 ] Similar affidavits were filed in support of garnishing orders made on April 27, 2017, August 18, 2017, and on February 5, 2018. [ 8 ] On February 3, 2017, the Royal Bank of Canada, pursuant to the garnishee paid $27,029.26 into court. [ 9 ] On February 7, 2018, the Canadian Imperial Bank of Commerce paid $40,534.40 into court. Argument

[10] The defendant’s argument is simple. It argues that when the phrase “after making all just discounts” in s. 3(2) of the CourtOrder Enforcement Act, R.S.B.C. 1996, c. 78 [the “Act”], is properly read, then each time an amount of money is paid into court, the“amount owing” sworn to by the deponent in the affidavit should be reduced by the monies paid in to court. Thus only the net amount,i.e., the difference between the monies in court and the amount claimed, should be stipulated in the deponent’s affidavit, and in the formof garnishing order. [11] The defendant pointed to Abermin Corp v.

Granges Exploration Ltd. (BC SC), 45 B.C.L.R. (2d) 188 (S.C.);Kenworth v. R. Parker Logging Ltd. (B.C.S.C); and Politeknik Metal San ve Tic A.S. v. AAE Holdings Ltd., 2015BCCA 318, as cases which require the plaintiff strictly observe the terms of the Act. [12] The meticulous observance of the strictures of the Act is for good purpose because the garnishing order before judgment is oneof the few times in law where a party may have property of an opposite party placed in safe keeping prior to judgment.

Therefore, thecourts are most chary of any abuse of the privilege of a garnishing order process. [13] Interestingly, this province’s Continuing Legal Education Society updated the British Columbia Creditors’ Remedies, anAnnotated Guide, in September 2017. In

section 6.12 it states: An applicant may obtain and serve more than one garnishing order to garnish the same amount. For example, if a defendant banks atthree financial institutions, separate garnishing orders can be served on the three institutions, each for the same sum. The orders willattach funds only to the extent necessary to satisfy the claimant’s claim. In addition, should a garnishing order fail to attach any funds oronly a portion of the total amount claimed, the claimant may obtain further orders.

However, the amount claimed must be reduced byany amount already paid into court. [14] That statement is interesting, as plaintiff’s counsel points out, because exactly the same wording (but for the use of the word“claimant” instead of “applicant”) is used in the CLE Manual in the 2018 update of the Provincial Court Small Claims Handbook, whichreflects the small claims process with respect to garnishing orders. [15] That is, as plaintiff’s counsel says, and I accept, the policy and process in effect in the Provincial Small Claims Court.

But thereis no policy in the Supreme Court to that effect. [16] The Act is a provincial statute. [17] Section 3(2) reads:

(2) A judge or a registrar may, on an application made without notice to any person by (

a) a plaintiff in an action, or (

b) a judgment creditor or person entitled to enforce a judgment or order for the payment of money, on affidavit by himself or herself or his or her solicitor or some other person aware of the facts, stating, (

c) if a judgment has been recovered or an order made, (

i) that it has been recovered or made, and (ii) the amount unsatisfied, or (

d) if a judgment has not been recovered, (

i) that an action is pending, (ii) the time of its commencement, (iii) the nature of the cause of action, (iv) the actual amount of the debt, claim or demand, and (

v) that it is justly due and owing, after making all just discounts, and stating in either case (

e) that any other person, hereafter called the garnishee, is indebted or liable to the defendant, judgment debtor or person liable to satisfythe judgment or order, and is in the jurisdiction of the court, and (

f) with reasonable certainty, the place of residence of the garnishee, order that all debts due from the garnishee to the defendant, judgment debtor or person liable to satisfy the judgment or order, as the casemay be, is attached to the extent necessary to answer the judgment recovered or to be recovered, or the order made, as the case may be. [18] There is no requirement therein that reduces the amount of the debt, claim or demand on the basis that monies have been paidinto court.

The Act only requires the plaintiff state “the actual amount of the debt”, “…after making all just discounts”. [19] The plaintiff argues that the monies in court are in fact not the plaintiff’s. They are at best a contingent credit. They may berepaid to the defendant if the garnishee affidavit or order is found wanting, or if the defendant wins at trial. The money in court will only

be paid out to the plaintiff after judgment. [20] “All just discounts” is not defined in the Act, but Voith J. in Key Insurance Services v. T.

Clarke Insurance Services Ltd, 2010BCSC 1857 said: The plaintiff must recognize and make adjustment for “all just discounts”, which has been defined as a liquidated claim advanced by wayof “set-off or counterclaim… As well the monies are subject to claims by a trustee in bankruptcy; and the monies can be subject to a charging order obtained by a thirdparty who locates the money in court and obtains a charging order on the funds in court. [21] As to the trustee in bankruptcy’s prior entitlement to funds paid into court, see Tradmor Investments Ltd. v. Valdi Food (1987)Inc., (ON SC), 1995 O.J.

No 1952, 33 C.B.R. (3d) 244 (Sup. Ct.) see paras. 20-21; Weeks Ltd. v. Canadian CreditMen’s Trust Association, (BC CA), 36 D.L.R. (2d) 444 (B.C.C.A.). At best, then, the plaintiff argues that the fund is apotential source of recovery if a plaintiff obtains a judgment. [22] I note further that the defendant attempted to set aside the garnishing order of January 17, 2017, but that application wasdismissed by Madam Justice Young on February 3, 2017. [23] Last but not least, the matter has already gone to

summary trial before Mr. Justice Jenkins and the parties are now awaiting adecision. [24] As counsel says, it is of note that there is no precedent case law on this issue, and the legislation has been in force almost 80years. I am satisfied that the current practice of issuing the garnishee for the total amount of the debt, despite the fact there are moniespaid into court against the debt, is acceptable. The plaintiff is not wrong to seek a garnishing order for the whole amount. [25] Accordingly, I dismiss the defendant’s application. The plaintiff is entitled to its costs. “Crawford J.”