



COURT OF APPEAL
        FOR BRITISH COLUMBIA




Citation:



Valley
                Mortgage and Investment Company Ltd. v. The Lakers Golf Club
                Ltd.,









2005 BCCA
            28




Date: 20050120




Docket: CA031975; CA032409

Between:

Valley
      Mortgage and Investment Company Ltd.

Respondent

(
Plaintiff
)

And

The Lakers
      Golf Club Ltd., 355534 B.C. Ltd.,

354354
      B.C. Ltd., 353844 B.C. Ltd.,

Kerry John
      Korberg also known as Kerry Korberg,

Kevin Gene
      Korberg also known as Kevin Korberg, and

Coastline
      Developments

Appellants

(
Defendants
)











Before:



The Honourable
            Chief Justice Finch





The Honourable
            Madam Justice Southin





The Honourable
            Madam Justice Huddart









G.S. McAlister

P. Dawson





Counsel for the Appellants





D.P. Church



Counsel for the Respondent





Place and
            Date of Hearing:



Vancouver, British Columbia





November 25, 2004





Respondents
            Submission Filed:



November 30, 2004







Appellants
            Submission Filed:                 December 9, 2004











Place and
            Date of Judgment:        Vancouver, British Columbia

January 20, 2005






Supplementary Reasons on Costs










Written
              Reasons by
:





The Honourable
            Chief Justice Finch





Concurred
              in by:





The Honourable
            Madam Justice Southin

The Honourable
            Madam Justice Huddart





Reasons for Judgment of the Honourable Chief Justice
        Finch:

[1]

The
      successful plaintiff respondent seeks special costs in two applications.  We
      pronounced oral reasons in both matters on 25 November 2004.

[2]

In
      the first application (Docket No. CA031975), the defendants applied to
      review and vary or discharge the order of Mr. Justice Oppal pronounced
      on 30 September 2004.  He held that leave to appeal the B.C. Supreme Court
      order of 4 May 2004 was required, that leave to appeal should be refused,
      and that the defendants application for a stay of the order should also
      be refused.  He refused leave to appeal on the basis that there was no
      merit in the proposed appeal.  We agreed, and dismissed that application.

[3]

In
      the second proceeding (Docket No. CA032409), the plaintiff applied to quash
      the appeal commenced by the defendants against the order of Mr. Justice
      Brooke pronounced on 15 October 2004 approving sale of the subject properties
      for $4.025 million.  We granted the order quashing that appeal on the basis
      that such an order necessarily followed the order in the first proceedings
      dismissing the application to vary or discharge Mr. Justice Oppals order
      refusing leave to appeal.

[4]

The
      plaintiff says an order for special costs is warranted in both proceedings
      because they amounted to an abuse of process, brought for the purposes
      of delay, in a case where the application for review was entirely without
      merit, and where the second appeal was completely unnecessary.  Counsel
      points to the terms of the mortgage which include provisions that the mortgagor
      (defendant) will pay to the mortgagee (plaintiff) costs on a solicitor
      client basis for proceedings taken to enforce the mortgage unless the
      court otherwise orders.  This provision is one factor the Court may consider
      in deciding whether to grant costs on a solicitor client basis:
CIBC
      Mortgage Corp. v. Lalji
(1986), 8 B.C.L.R. (2d) 310 (C.A.).

[5]

Factors
      to consider in whether an order for special costs should be granted include
      any delay in the proceedings caused by the mortgagor, the mortgagors equity
      in the subject property, and the inequity in permitting the mortgagor to
      have the benefit of contractual interest rates while the mortgage is in
      default while not bearing the burden of contractual costs: see
Saskatchewan
      Trust Co. v. Kalanj
(1989), 39 B.C.L.R. (2d) 385 (B.C.S.C.).



[6]

In
      the circumstances of this case a consideration of these factors favours
      an order for special costs in both proceedings.  The defendant had no equity
      in the property which, on a sale, will likely result in a shortfall to
      the plaintiff of about $1.5 million.  As set out in our reasons of 25 November
      2004, there was no merit to the defendants position in either proceeding.  As
      well, the history of the proceedings suggests delay on the defendants
      part as the principal, if not only, motivating factor.  The defendants
      pursued a review of the refusal to grant leave to appeal after being told
      by Mr. Justice Oppal that the appeal itself had no merit.  The defendant
      also filed a notice of appeal in the second proceeding knowing full well,
      as a result of Mr. Justice Oppals previous reasons, that leave to appeal
      was required.

[7]

Section
      20 of the
Law and Equity Act
, R.S.B.C. 1996, c.253 gives
      the court a discretion to award solicitor and client costs in foreclosure
      proceedings, whether provided for in the mortgage or not.  I do not understand
      any provision of the
Land Title Act
, R.S.B.C. 1996, c.250
      to fetter that discretion.



[8]

I
      would order that the plaintiff have special costs of both proceedings in
      the Court of Appeal.







The Honourable
Chief
      Justice Finch







I Agree:







The Honourable
Madam Justice Southin







I Agree:







The Honourable
Madam Justice Huddart






