Kootenay Savings Credit Union v. Brar, 2023 BCSC 1379

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Kootenay Savings Credit Union v. Brar, 2023 BCSC 1379 Date: 20230809 Docket: 20319 Registry: Nelson Between: Kootenay Savings Credit Union Plaintiff And Gurmeet Brar, Navdeep Brar, Jasrevan Brar and Mauveen Brar Defendants Before: The Honourable Madam Justice Lyster Reasons for Judgment Counsel for the Plaintiff: R.R.W. Sookorukoff Counsel for the Defendants, Navdeep Brar, Jasrevan Brar and Mauveen Brar: M.E. Guy No one appearing for the Defendant, Gurmeet Brar. Place and Date of Hearing: Nelson, B.C. June 19 & 21, 2023 Place and Date of Judgment: Nelson, B.C.

August 9, 2023 Introduction [ 1 ] Kootenay Savings Credit Union (“KSCU”) applies for an order paying funds out of court to realize the amount payable to it under its judgment against the defendant Gurmeet Brar. [ 2 ] Gurmeet Brar did not appear on this application. His former spouse, Navdeep Brar, and two adult children, Jasrevan and Mauveen Brar, did. They oppose the application. [ 3 ] The application arises subsequent to a fraudulent conveyance trial presided over by Justice Crerar, and a subsequent appeal upholding his decision.

At trial, KSCU was successful in obtaining an order setting aside the transfer of Gurmeet’s half interest in a residential farm property located in Abbotsford, B.C. (the “Property”) to Navdeep, Jasrevan and Mauveen: Kootenay Savings Credit Union v. Brar , 2021 BCSC 2027 . Justice Crerar also set aside a term in a desk order divorce order that purported to give Navdeep sole ownership of the Property. [ 4 ] Navdeep, Jasrevan and Mauveen appealed Crerar J.’s decision: Brar v. Kootenay Savings Credit Union , 2023 BCCA 68 . The Court of Appeal dismissed the appeal.

In its conclusion the Court added certain “observations” which are at the heart of the present dispute. I will return to them in due course. [ 5 ] While the appeal was pending, Navdeep, Jasrevan and Mauveen paid $840,000 into court to the credit of this action in exchange for KSCU releasing its certificate of pending litigation. It is those funds from which KSCU seeks to realize its judgment. [ 6 ] I note that Navdeep, Jasrevan and Mauveen have filed an application for leave to appeal the Court of Appeal’s decision with the Supreme Court of Canada.

No decision had been rendered at the time of this hearing or this judgment. Analysis [ 7 ] I return to the observations of the Court of Appeal at paras. 29-33: [29] For the reasons set out above, I would dismiss the appeal. I consider it important, however, to add the following observations.

[30] While the judge determined that both the 2017 transfer and the Property term in the Desk Order must be set aside, what has not been determined is the extent of Mr. Brar’s interest. [31] It will be recalled that the Desk Order contained only two terms. The term that the parties be divorced survives. The Property term does not. The result is that Ms. Brar is divorced, but her claim for an unequal division of property as set out in her notice the family claim remains unresolved. It is a claim that is open to her to pursue.

Although she can no longer rely on the 2010 separation agreement, there is nothing in the orders pronounced by the judge that prevents Ms. Brar from asserting, for instance, that she is entitled to an unequal division of the Property in accordance with the provisions of sections 94 and 95 of the Family Law Act , SBC 2011, c 25 . [32] Of course, I cannot say whether such a claim would have any merit.

Nevertheless, as this Court confirmed in Chichak v Chichak , 2021 BCCA 286 at paras 9–10 , any judgment against title under the Court Order Enforcement Act , RSBC 1996, c 78 (such as Kootenay might obtain in this case) would be subject to the equities, including beneficial interests, because a judgment creditor (Kootenay) cannot take more than the interest of the judgment debtor (Mr. Brar). Here, the extent of Mr. Brar’s interest remains to be determined in accordance with any claim Ms.

Brar may have under the Family Law Act . [33] The parties should proceed accordingly in the Supreme Court of British Columbia, and I would direct Ms. Brar to file a copy of the entered orders of the Supreme Court pronounced October 18, 2021, and January 27, 2023, in her family law proceeding. [ 8 ] KSCU submits that in filing this application it is proceeding in accordance with these observations.

It submits that it cannot have been the intent of the Court of Appeal that it would have to sit idly by until Gurmeet and Navdeep eventually get around to resolving their respective interests in the Property, should they ever choose to do so. In this regard, KSCU relies upon the very negative credibility findings made against all of the defendants by Crerar J., and his conclusion that the transfer of the Property constituted a fraudulent conveyance. [ 9 ] Navdeep, Jasrevan and Mauveen filed an application response in which they opposed the orders sought.

In their response, they made certain factual assertions, however they failed to file any affidavit evidence to substantiate those assertions. I disregard them. [ 10 ] Navdeep, Jasrevan and Mauveen submit that the family law case must be heard and decided first before KSCU can seek to realize its judgment. They note that Navdeep’s share of the Property has not yet been determined by any court. Counsel advised the court that the family trial is scheduled before the end of this year, but she declined to state the dates.

I accept counsel’s representation about approximately when the trial is scheduled to occur, although I found her reluctance to state precisely when concerning. Her position was that KSCU is a stranger to the family law case, and not entitled to participate in it or receive any information about it. [ 11 ] While styled as “observations”, I am of the view that the Court’s comments on appeal are directions which are binding on the parties and this court.

It falls to this court to discern what the Court of Appeal’s intention was. [ 12 ] There is no question that the Court stated that KSCU cannot take more than the beneficial interest of the judgment debtor, Gurmeet, and that the extent of Gurmeet’s interest remains to be determined in the family law case. [ 13 ] I agree with KSCU that it cannot have been the Court’s intention that it would have to sit on its hands awaiting the outcome of a family law case that might never come to trial.

KSCU is a judgment creditor, and it is entitled to realize on its judgment against Gurmeet to the extent there are funds available. [ 14 ] At the same time, I agree with Navdeep, Jasrevan and Mauveen that this court cannot, on this application, determine what Navdeep and Gurmeet’s respective interests in the Property are. That can only be determined within the family law case. [ 15 ] KSCU is understandably concerned that the family law trial, assuming it should come to pass, might be a “friendly trial”, given the conduct of the defendants as found by Crerar J.

Gurmeet and Navdeep are not adverse in interest and cannot be expected to ensure that the court hearing their family law trial is fully apprised of all relevant facts. The Court of Appeal was cognisant of this potential problem; that is why they directed Navdeep to file a copy of the entered orders of the Supreme Court in this proceeding in her family law proceeding. I do not think, however, that that is a complete answer to the procedural conundrum posed by this case. [ 16 ] Substantial guidance as to how to comply with the Court of Appeal’s observations can be found in the Chichak v.

Chichak , 2021 BCCA 286 , decision referred to by the Court at para. 32. In that case, in the proceedings below in this court, two matters were heard together, addressing what was to be done with funds remaining from the proceeds of sale of the Chichaks’ former family home: MCAP Service Corporation v. Chichak , 2018 BCSC 1892 . The first of those matters was the application of two judgment creditors of Mr. Chichak, who were seeking an order that the remaining funds be paid out to them. The second was Ms.

Chichak’s petition seeking a declaration that she had a 50% beneficial interest in the home that ranked in priority to the judgment creditors’ interests. [ 17 ] In my view, a similar form of proceeding is necessary in this case in order to ensure that the Court of Appeal’s observations are complied with, and that the interests of both KSCU and Navdeep are fairly addressed. It would be premature for the court to rule on KSCU’s application before Navdeep’s share of the Property is determined.

It would be unfair to KSCU for Navdeep’s share of the Property to be determined without its participation. [ 18 ] I therefore adjourn KSCU’s application. I further order, pursuant to Rule 22-5(8) of the Supreme Court Civil Rules, B.C. Reg. 168/2009 , that KSCU’s application be heard together with Navdeep and Gurmeet’s family law trial.

It will be for the judge hearing the two matters together to determine the manner in which the two proceedings will be heard, and to make such further orders and directions as may be necessary to comply with the Court of Appeal’s observations. [ 19 ] I turn to the costs of this application. In response to counsel for Navdeep, Jasrevan and Mauveen disclosing during the hearing the approximate time the family law trial is scheduled to occur, counsel for KSCU provided the court with emails between counsel in which it repeatedly sought information about the status of the family trial.

Its inquiries were not answered, and it was only during the hearing that it learned that a trial had even been scheduled. In my view, Navdeep, Jasrevan and Mauveen’s choice not to respond to KSCU’s reasonable inquiries about the status of the family trial effectively forced KSCU to bring this application. While I have not

granted KSCU the orders it sought in this application, and have adjourned its application to the hearing of the family law trial, KSCU ought not to bear the costs of this application, costs which could have been avoided had Navdeep, Jasrevan and Mauveen taken a more reasonable approach. I therefore order Navdeep, Jasrevan and Mauveen to pay KSCU’s costs of this application, in any event of the cause. “L.M. Lyster J.” LYSTER J.