2012 QCCQ 3042, 2012 QCCQ 3042

G.K. c. G.K. 2012 QCCQ 3042 COURT OF QUEBEC CANADA PROVINCE OF QUEBEC District of Montreal « Civil Division» N°: 500-22-173655-104 DATE : April 12, 2012 ______________________________________________________________________ IN THE PRESENCE OF THE HONOURABLE DIANE QUENNEVILLE, J.C.Q. ______________________________________________________________________ G... K... SR. and C... G... Plaintiffs -vs- G... K... JR. and S... S... Defendants ______________________________________________________________________ JUDGMENT ______________________________________________________________________ [ 1 ] The Plaintiffs G... K...

SR. ( Senior ) and his wife, C... G..., seek the reimbursement of a loan in the amount of $33,000 on which a balance of $30,122.44 is due, as appears from the Amended Motion to Institute Legal Proceedings. [ 2 ] According to Senior, both Defendants, his son G... K... JR. ( Junior ), and the latter's former wife, S... S... ( S... ), are solidarily responsible for this loan. [ 3 ] Junior admits the loan made by Senior and the balance owed of $30,122.44.

However, he denies being responsible for this loan, adding that S..., as the sole owner of the property purchased in part with the loan, is the only person responsible to reimburse it. In fact, Junior called in warranty S... requesting that she reimburse any amount he may be condemned to pay to Senior. [ 4 ] S... contests Plaintiffs' action and the action in warranty. She never contracted the loan, only Junior contracted it. Moreover, the Agreement on accessory measures, later confirmed in the Judgment in Divorce, settled the issue.

The facts [ 5 ] Junior and S... were married until May 2008, at which time they separated. During their marriage, they wished to purchase a house. To help them, Senior took a mortgage of $33,000 on his property, on December 1, 2004, as appears from the deed of mortgage [1] . This amount was used by Senior to help Junior and S... put a down payment towards the purchase of the house. [ 6 ] On January 14, 2005, a deed of sale was concluded between Johanne Prieur and Junior, S... and Senior for the house located at 58 Charlevoix Boulevard, in Kirkland [2] .

In this deed of sale, both Junior and S... have a 42 % share in the house while Senior has a 16 % share.

This 16 % share was given to Senior to secure the $33,000 loan. [ 7 ] In May 2008, Junior and S... separated and, in […], an Agreement was concluded on accessory measures, which was confirmed in the Judgment of Divorce dated […]. [3] [ 8 ] Prior to this judgment, in November 2009, a deed of sale was concluded between Junior, Senior and S... by which the latter became the sole owner of the property, in consideration of a payment of $1.00, and with the obligation of assuming the mortgage with the Toronto-Dominion Bank. [4] [ 9 ] The reimbursement of the monthly payments to Senior, in the amount of $165.21, continued until March 2010, at which time the payments stopped.

On March 15, 2010, a demand letter was sent by Senior to S.... [5]

[ 10 ] As none of the payments were made after March 2010, Senior instituted an action against both Junior and S.... The analysis [ 11 ] The details of the loan was never put into writing. As S... explained, during the marriage, she was raising the children and Junior gave her money to pay for the household expenses. When the house was purchased, S... attended at the Notary and at the Bank and was told where to sign.

She obviously knew that Senior helped them purchase the house, however she insists she was never told the exact amount of the loan. [ 12 ] At the outset of the trial, an objection was made on the basis that the loan, having a value exceeding $1,500, could not be proven by testimony in accordance with

article 2862 of the Civil Code of Quebec . Senior stated that a commencement of proof existed; therefore proof could be made by testimony. The Court took this objection under reserve. The Court dismisses the objection on the basis that there is commencement of proof in writing, as provided by

article 2865 C.c.Q. , namely the Bank statement [6] .

In any event, the Court concludes this issue is irrelevant. [ 13 ] Junior admits that a loan was made by Senior and he admits the balance of $30,122.44. [ 14 ] As for S..., the loan was never put in writing, she never signed any document that would confirm her liability to reimburse it and the amount of the loan, as well as the amount of the monthly payments were negotiated between Senior and Junior only. [ 15 ] Prior to the Agreement on accessory measures of September 2009, which was later confirmed in the Judgment of Divorce of December 7, 2009, the situation could have been different.

However, the Court concludes that the Agreement settles the issue. At paragraph 8.1 of the Agreement, the parties declare the following:

Article 8 Disposition of Property, Assets and Liabilities 8.1 The parents agree that the property at […], Kirkland, Québec, […], presently in both names as well as in the Husband's fathers name will be transferred into the Wife's name and she will be responsible for all expenses related to this property and the Husband will not be responsible for any such expenses nor will he make any claim on it. The Husband agrees that he will be financially responsible for all notary fees related to this transfer.

The Wife undertakes to give to the Husband first right of refusal to purchase this property at fair market value when she desires to sell the immovable; [ 16 ] The parties also provide the following at paragraph 8.6: 8.6 All debts that each have in their own names will be the financial responsibility of the debt holder, and the other will have no responsibility for any debts in the name of the other; [ 17 ] No mention is made of the loan made by Senior. Junior knew that an outstanding balance was owed on the loan.

The fact that S... undertakes to be responsible for all expenses related to the property cannot be interpreted as an expense of the property. Junior is a businessman. He should have specifically referred to the loan in the Agreement. The fact that the payments continued until March 2010 does not constitute proof that S... agreed to be liable for this loan. 1555.

Payment may be made by any person, even if he is a third person with respect to the obligation; the creditor may be put in default by the offer of a third person to perform the obligation in the name of the debtor, provided the offer is made for the benefit of the debtor and not merely to change creditors. A creditor may not be compelled to take payment from a third person, however, if he has an interest in having the obligation performed by the debtor personally. 1667.

Designation by a debtor of a person who is to pay in his place constitutes a delegation of payment only when the delegate obligates himself personally to the delegatee to make the payment; otherwise, it merely constitutes an indication of payment. [ 18 ] Junior is liable for the loan, as he admitted this fact, whereas S... denied having any responsibility towards Senior. [ 19 ] In accordance with

article 2803 of the C.C.Q. , Senior had the obligation of proving the basis on which rested his action. He succeeded towards Junior, however he did not succeed against S.... FOR THESE REASONS, THE COURT: GRANTS in part Plaintiffs G... K... SR. and C... G...'s action; CONDEMNS Defendant G... K... JR. to reimburse to Plaintiffs the sum of $30,122.44, plus interests at the legal rate as of the institution of the action; DISMISSES Plaintiffs' action against Defendant S... S..., WITH COSTS ; DISMISSES G... K... JR.'s action in warranty against S... S..., WITH COSTS .

__________________________________ DIANE QUENNEVILLE, J.C.Q. Me David Rosenzveig ROSENZVEIG, STRAUBER & WAXMAN Attorneys for Plaintiffs Me Anthony Martino MARTINO, PERLUZZO Attorneys for Defendant G… Jr. K… Me Rafal Jeglinski WOODS & ASSOCIATES Attorneys for Defendant S... S...