Kimberly Ginther PLAINTIFF And: Brendan Gaulton DEFENDANT, 2020 NLSC 134

court crest IN THE SUPREME COURT OF NEWFOUNDLAND AND LABRADOR GENERAL DIVISION Citation : Ginther v. Gaulton , 2020 NLSC 134 Date : October 14, 2020 Docket : 201101G3716 Between: Kimberly Ginther PLAINTIFF And: Brendan Gaulton DEFENDANT Before: Justice Carl R. Thompson Place of Hearing: St. John’s, Newfoundland and Labrador Dates of Hearing: September 22 and 23, 2020

Summary: Claims grounded in debt during cohabitation of the parties were not proven. Appearances: Stephen P. Orr Appearing on behalf of the Plaintiff Daniel W. Bennett Appearing on behalf of the Defendant

Authorities Cited: CASES CONSIDERED: Wheaton v. Palmer, [1999] N.J. No. 365; (1999) (NL SC), 183 Nfld. & P.E.I.R. 233 (S.C.(T.D.)); Meyers v. Dunphy, 2007 NLCA 1 REASONS FOR JUDGMENT Thompson, J.: INTRODUCTION [1] The Plaintiff claims that she loaned the Defendant approximately $60,000 for credit card purchases, real property purchases,the purchase of a motorcycle and miscellaneous items. In “Without Prejudice” correspondence from the Defendant’s counsel dated May31, 2007, the Defendant acknowledged that he owed the Plaintiff the said amount.

The Plaintiff argues that this is an admission of thedebt owing and no weight should thus be given to the Defendant’s argument that the Plaintiff owes him money by way of set off or thatthe money in question was a gift. [2] As to the significant portion of the $60,000 debt representing $40,000 the Defendant produced a gift letter which he states isproof that the Plaintiff gifted him the money claimed. However, the Plaintiff states that the letter was not signed by her and notes that itwas not witnessed and contains the incorrect spelling of her name.

The Plaintiff takes the position that this letter should not beadmissible in court. THE PARTies cohabitation [3] In May 2004 the parties started a relationship (common-law) which concluded in May of 2007. They first lived on SamsonStreet, Mount Pearl. He rented Samson Street. They lived there from May 2004 until October 2004. He then bought Eagle Street. Theylived there from October 2004 until April 2005. This was a pattern of purchase, repair, then rental of homes. She made no financialcontribution to these homes. She worked at a call centre and also a law firm and went to university.

He bought on O’Flaherty Crescentin April 2005 and sold in August 2005. The Plaintiff held no interest in these properties. [4] She owned 28 Prince of Wales Street. It had been totally stripped out and repaired by her and her father. After the sale onO’Flaherty Crescent they stayed there while they were waiting for his house to be ready. [5] In October of 2005 the parties then moved to another home of his on Talon Street and stayed there until January of 2006.

They then moved to Alberta and separated March 7, 2007. the plaintiff’s clAims in debt [6] Though they cohabitated, the Plaintiff sues in debt for money advanced to the Defendant by her from time to time during thatperiod. Counsel for the Plaintiff advises that a matrimonial property claims approach to recovery was not available as a period of oneyear cohabitation in Alberta had not taken place. In general the debts are firstly a loan of $40,000 to buy the Talon Street residencesupported by two bank drafts drawn on his account and payable to him.

Secondly, a motor bike allegedly owned by her and taken byhim in March of 2007 valued by her at $10,000 and miscellaneous other items allegedly loaned to him totaling approximately $10,000. evidence of the deBts

a) Loans for Talon Street Purchase [7] The Plaintiff presented copies of two bank drafts for $35,000 and $5,000 respectively, payable to the Defendant. It is not inissue that $35,000 was directed to the purchaser by the Defendant for the purchase of the Talon Street residence. He is not sure of the$5,000 amount. She says there was a written agreement to support the debt kept by her in her metal filing cabinet which went missing,her believing he took the cabinet. He presented, under objection from her, a document headed “Gift Letter” confirming the $35,000 as agift by her to him.

He testified this letter was required by the bank to support his mortgage of the property. She claims the signature ofher name was not signed by her and the document was fabricated. He claims she had it prepared at the law firm where she worked andthat she placed it on the kitchen table. He initially testified he saw her sign it at that time but later that it was already signed by her. Hesays that she said that they were moving to Alberta for his work and at the time she gave him the gift letter, the plan was that he wouldbe making all the money and paying all the bills.

b) The Motorcycle [8] The Plaintiff claims the value of a 1989 rebuilt Harley Davidson which she claims she owned. He claims that, in the face ofcriminal charges, he agreed with her to put the bike in her name. She claims that she repaid it in various ways over time. There is noindependent confirmation of this repayment. It is not in issue that he took possessions of it after their separation. He says it was part ofan informal arrangement.

c) Miscellaneous

i. Appliances [ 9 ] It is not in issue that they took appliances including the fridge and stove from her residence at 28 Prince of Wales Street and put in in his residence on Eagle Street when they moved there. She claims it was worth $2,500 at the time (which was October of 2004). He says that when he sold Eagle Street (which was April of 2005) she told him to leave these items at Eagle Street. He claims the appliances were then three years old and he had been paying all of the bills at these times. ii. Honda ALX [ 10 ] She claims that she paid $2,000 for it and he drove it to Alberta.

She acknowledges there was a transfer from her but it was not her signature. He says that she signed off on it at his request and left the transfer in the glove box at his request. He said she took the Jeep and he took the Honda on separation.

d) Airline Tickets [ 11 ] She claims $520.82 for an airline ticket purchased March 8, 2007 for his return home the day after separation. The Plaintiff as well claims for an airline ticket purchased July 28, 2004 for his nephew at his request. He could not remember this, saying it was a long time ago. iii. Balance of Miscellaneous [ 12 ] She testified that this amount of some $4,500 were purchases by her of motorcycle parts for him. She produced copies of invoices of hers where she marked those items.

He claims that he was making the majority of income then, albeit admittedly by him from illegal activity and he paid substantially the majority of all these bills by giving money he received to her. He also noted that bike parts were missing when he accessed the storage unit in Newfoundland after the separation. It was agreed she held the keys to the two storage units. considerations and conclusions Admissibility of Without Prejudice Correspondence [ 13 ] The Plaintiff seeks to place in evidence correspondence dated May 31, 2007 from the Defendant’s then solicitor as follows: Without Prejudice Dear Ms.

Keating: We write in response to the email sent to us dated May 30 th , 2007. Without answering any of the accusations made or attempting to make comments on all the items raised in your letter, we write to advise that we have spoken to our client and are advised of the following: 1. Mr. Gualton [sic] is attempting to refinance the homes through Albert Handrigan (CIBC) and we are awaiting notification of approval of same.

Upon approval, we will complete the necessary legal work and then forward monies to you. (Whether the total amount of monies will be able to be forwarded to you, will not be known until we obtain the information from Albert Handrigan, but the hope is to pay you $60,000.00 or if not the “lions” share of $60,000.00, with the balance to be secured by a promissory note. 2.

Upon agreement of the payment, then the following will be done before payment is forwarded to you. i. there will be a full and final Release signed by you giving up any and all interest to any assets, etc.; ii. you are to sign over the registration to the two motorcycles to Brendan Gaulton; iii. you are to provide Brendan Gaulton with all his personal belongings, which include items in storage in Newfoundland. We await your reply.

Robert B. Anstey [14] The Defendant objects on the basis that it is a privileged communication. The Plaintiff seeks to tender the communication tosupport her position that the Defendant acknowledged the debt of $60,000 upon which she now takes this action. [15] In Wheaton v. Palmer, [1999] N.J. No. 365; (NL SC), 183 Nfld. & P.E.I.R. 233, Orsborn, J. (as he thenwas) stated at paragraph 125: 125. However, through reference to an earlier decision of the Court of Appeal - Belanger v. Gilbert (1984), (BCCA), 14 D.L.R. (4th) 428 (B.C.

C.A.), Taggart, J.A., noted that an analysis of the content of a without prejudice document is necessarybefore making a determination of inadmissibility. At. p. 294, quoting from Belanger and Gilbert: “... Even if the letter had been marked as without prejudice it would not, in my judgment, assist the appellant in this case. Not all lettersso marked are to be held inadmissible. I refer to the judgment of this court in Schetky v. Cochrane et al., (1918) (BCCA), 1 W.W.R. 821, 24 B.C.R. 496, and the judgment of Mr. Justice Martin at p. 827. On that page Mr. Justice Martin referred to thecase of Daintrey, Re Ex p.

Holt, [1893] 2 Q.B. 116, in which he said: “... it was held that an admission of bankruptcy may be proved in a letter from the debtor to the creditor, though marked 'withoutprejudice' ...” And he quoted from the judgment saying: “In our opinion the rule which excludes documents marked 'without prejudice' has no application unless some person is in dispute ornegotiation with another, and terms are offered for the settlement of the dispute or negotiation ...” [16] In Meyers v. Dunphy, 2007 NLCA 1, Wells, C.J. stated at paragraph 12: 12.

There is no real dispute between the parties as to the general principles to be applied in determining whether a party is entitled tohave excluded, from admission as evidence, an exchange of correspondence that is said to be protected by settlement privilege. Both citeThe Law of Evidence in Canada, as quoted by the applications judge, and as set out in paragraph 6 above, as authority for the propositionthat the conditions that must be shown to have been present in order for the privilege to be recognized are: (

a) a litigious dispute must be in existence or within contemplation; (

b) the communication must be made with the express or implied intention that it would not be disclosed to the court in the eventnegotiations failed; and, (

c) the purpose of the communication must be to attempt to effect a settlement. That proposition has been expressly approved by this Court in White v. F.W. Woolworth Co. (1996), (NL CA), 139Nfld. & P.E.I.R. 324 (Nfld. C.A.) (see paragraph 137). It is, therefore, the standard to be applied in this case. [17] On this evidence is it not clear if litigation had been commenced by May 31, 2007 the date of this communication. There iscorrespondence in evidence from Mr.

Anstey to the Plaintiff dated June 12, 2007 advising that an application had already been initiatedin Newfoundland and Labrador for an order for distribution of the assets and liabilities (Consent 1, Tab 13). The Plaintiff had written toMr. Anstey June 07, 2007 stating she wished to pursue under Alberta law and Alberta courts (Consent 1, Tab 13). [18] In this context, the previous communication “Without Prejudice” from Mr. Anstey a week earlier and for which admission issought, taking its contents into view, confirms that there existed a dispute to which the description of “litigious” may reasonably beapplied.

Certainly, one was contemplated and the contents disclose that its significance warranted Mr. Anstey specifying suchconditions as being a full and final release of all interests in assets, common practice for counsel prudently acting to secure finality so asto preclude litigation, with conditions effecting such finality of outstanding matters in dispute without conceding or compromising thecontinued right to full relief in the event of non-acceptance of the terms. [19] Given the intent of the communication, I am satisfied that it constituted a formal offer containing a compromise of the

Defendant’s position in the face of the Plaintiff’s demands. In my view, counsel, charged with attempting to conclude a settlement otherwise the likely subject of litigation, was mandated professionally to secure its protection from the potential for its use in such subsequent litigation should the offer not be accepted.

Clearly this communication was made with the intention it would not be disclosed to the Court in the event negotiations failed. [ 20 ] Finally, the communication clearly seeks to effect a settlement. [ 21 ] I concluded the communication is privileged and cannot be evidence in this proceeding. [ 22 ] Of note, additionally the Plaintiff asks that this communication be, in any event, considered as acknowledgement of a debt in support of this cause of action in debt. As a privileged communication its admission is precluded absolutely for that purpose as well.

I discussed with counsel for the Plaintiff that should the Plaintiff’s position be that the communication was an acknowledgement supporting the Plaintiff’s claim, then one would expect the Plaintiff to sue on the agreement containing the acknowledgement, that is, sue on the settlement offer as being enforceable. Admissibility of the Gift Letter [ 23 ] The Plaintiff says the gift letter was fabricated and she did not sign it. She placed in evidence copies of her Alberta driver’s license and her Visa car, both with her signatures.

Her surname had changed from the time of the gift letter to that of her present surname as used on the Visa and driver’s license. The Plaintiff proposes the spelling of her first name appears to have an “ei” combination rather than the singular “i” on her Visa and driver’s license. [ 24 ] The Plaintiff having denied its execution, takes the position that because of that denial the Defendant has not established her execution so precluding admissibility. [ 25 ] The Defendant says she delivered it to him signed.

He says the bank required it as proof that the deposit for purchase of the property by the Defendant was freely his before providing mortgage financing. [ 26 ] In my view, even if the document was required by the bank, its execution does not appear by the bank as requiring formal or solemn proof of execution. As between the parties it is then private to them. As the authorship only is in question, its admissibility may take place to have it and its validity determined. [ 27 ] To the extent necessary, I will deal shortly with its applicability in the considerations and conclusions next following.

Status of the $35,000 and $5,000 Advances [ 28 ] The evidence is not in dispute as to the advance of $35,000 to the Defendant for the purchase of the Defendant’s Talon Street property. Both parties then moved into this residence from her property at 28 Prince of Wales Street. They had stayed at 28 Prince of Wales Street for some five weeks and then at Talon Street for some three months from October 2005 to January 2006 before moving to Alberta. [ 29 ] Previously from May 2004 they cohabited on Samson Street, Mount Pearl, a property he rented.

Then they cohabitated at property he bought at Eagle Street from October 2004 until April 2005. He bought a property at O’Flaherty Crescent and they moved in together from April 2005 until August of 2005. [ 30 ] So the parties cohabitated from May 2004 until August 2005 when they moved to her residence at 28 Prince of Wales Street. She appears to have sold Prince of Wales Street prior to their moving in to Talon Street. This sale generated the cash that she advanced to him for the $35,000 and $5,000 bank drafts. The $35,000 is not contested as being for Talon Street.

The other $5,000 she says was as well; he is unclear as to its application but appears to concede his receipt of it as well. [ 31 ] While not specifically disclosed, his income appears to have been supplemented significantly during this cohabitation by his profit in the prohibited drug transactions. [ 32 ] Her income during this time period generally as shown on her tax returns gross revenue was $16,186 for 2004 and $12,193 for 2005. She was working part-time at a call centre and a law firm and attending university. She says that she physically helped with renovations for each of the four houses they lived in.

When they moved she dealt with the tenants as they rented these properties. She says she paid bills and paid for groceries. [ 33 ] In my view practically the capacity to purchase the dwellings, upgrade and rent rested with the Defendant. Practically I accept as well she would have helped to the extent of her ability in this ongoing process during their cohabitation. Their relationship supported this ongoing activity. [ 34 ] In that continuing support of each other she chose to make available to his last purchase before their move to Alberta proceeds from the sale of her home.

She appears to have done that without any form of acknowledgement of debt or the taking of any security to protect those significant advances. [ 35 ] In the context of this relationship as I have described it above, the advance of the $35,000 and $5,000 does not have with it an acknowledgement as a debt or independent proof of any several debt upon which demand payment could be made and enforced. [ 36 ] It may well be that a fully disclosed and assessed contribution of both parties may present rights and obligations of both; however, in the context of this relationship as presented to me, I cannot find authority upon which I could base a specific stand-alone transaction permitting separate relief. [ 37 ] In coming to this conclusion I would note that I have not had to assess or weigh the proposed gift letter.

That said, had it been

necessary to consider it, I offer that I would have had difficulty giving effect to its contents absent the context of its background, independent confirmation of its requirement, its preparation and its use, irrespective of any assessment of whether or not the Plaintiff subscribed to it. The Motorcycle [ 38 ] The motorcycle appears to be an asset present during the cohabitation.

Irrespective of the evidence of its registration, his claim of the basis for its transfer to her and her claim for repayment to him in value over time, again there is no several independent basis upon which I could conclude on the evidence before me that one party has a several interest of ownership in this vehicle from the other. Miscellaneous i. Appliances [ 39 ] The appliances originally owned by the Plaintiff at 28 Prince of Wales Street were moved by agreement to a residence of cohabitation of the parties.

These appliances are often considered fixtures in place for the purposes of sale and for use during rental. Again, I have no several basis upon which I may find a debt outstanding and enforceable in respect of them as between the parties. ii. Honda ALX [ 40 ] This asset was of use to the parties during cohabitation. Again, with this motorcycle there is no several basis by which I can conclude ownership and a corresponding right of repayment or compensation. iii. Balance of Miscellaneous including Airline Ticket for Nephew [ 41 ] These represent comingled assets and liabilities during cohabitation.

Again, for the same reasons as above I cannot find a basis of several debt acknowledged, owing and enforceable as between the parties. iv. Additional Airline Ticket [ 42 ] The ticket was purchased by the Plaintiff for the Defendant’s return home one day after separation. On the evidence this was in conjunction with the return and division of assets used during cohabitation. [ 43 ] Again, I see no independent acknowledgement or basis for its several return for the reasons previously stated.

ORDER [ 44 ] The Plaintiff’s claim is dismissed with costs to the Defendant under Column III of the Scale of Costs. _____________________________ Carl R. Thompson Justice