



COURT OF APPEAL FOR BRITISH COLUMBIA




Citation:



Hlatky v. Royal Bank of Canada,









2013 BCCA 7




Date: 20130116

Docket:
CA040072

Between:

Kerry Norman
Hlatky, Roberta Phyllis Martin, Angelique May Hlatky,
The Attorney General of Canada, representing the interests of
Her Majesty the Queen in the right of Canada

Appellants

(Plaintiffs)

And

Royal Bank of
Canada and the
Department of Indian and Northern Affairs

Respondents

(Defendants)




Before:



The Honourable Madam Justice Bennett





(In Chambers)




On appeal from:  Supreme
Court of British Columbia, November 30, 2011
(
Hlatky v. Royal Bank of Canada
, Vancouver Registry H090886)




Appellant Appearing in Person:



K.N. Hlatky





Counsel for the Respondent

Royal Bank of Canada:



K.L. Carteri





Counsel for the Respondent Attorney General of Canada:



B. Reilly





Place and Date of Hearing:



Vancouver, British
  Columbia

December 19, 2012





Place and Date of Judgment:



Vancouver, British
  Columbia

January 16, 2013








Reasons
for Judgment of the Honourable

Madam Justice Bennett:

1.       Nature
of the application

[1]

This is an application by Kerry Norman Hlatky, Roberta Phyllis Martin
and Angelique May Hlatky (the Applicants) for an extension of time to bring
an application to review the Order of Madam Justice MacKenzie dated October 25,
2012, pursuant to s. 9(6) of the
Court of Appeal Act,
R.S.B.C. 1996,
c. 77 and Rule 34(1) of the
Court of Appeal Rules,
B.C. Reg. 297/2001. 
MacKenzie J.A. dismissed their application for an extension of time to
apply for leave to appeal of the Order of Mr. Justice McEwan made on November 30,
2011.

[2]

In other words, this is an application for an extension of time to file
a review of an Order denying an extension of time to appeal the Order of McEwan J.,
who himself denied an extension of time to appeal the original substantive
order.

[3]

An application for review must be filed within seven days of the
decision.  This application was filed on November 23, 2012, several weeks
out of time.

[4]

The Attorney General of Canada seeks to have the Department of Indian
and Northern Affairs (the Department) removed as a respondent in this
appeal.  The Applicants apparently added the Department as a party unilaterally
at the appeal stage.

2.       Background and procedural history

[5]

These proceedings relate to a foreclosure matter started by the Royal
Bank of Canada (RBC) in 2009.  The Applicants mortgaged the property at issue
to RBC (the Property).  On September 17, 2009, Master Taylor issued an
Order Nisi of Foreclosure against the Property.  On April 8, 2010, Master
Tokarek made an Order granting conduct of sale to RBC.  The Applicants appealed
this Order.  This appeal was dismissed on April 20, 2010 by Mr. Justice
Groves.

[6]

RBC ran into considerable difficulty accessing the Property as the Applicants
refused to vacate it.  When removed by police, the Applicants would return.  RBC
required a number of appearances in the Supreme Court to effect the sale of the
Property, which was sold to a third party by the Order of Master Scarth made September 15,
2011.

[7]

Mr. Hlatky applied on October 26, 2011 for an extension of time to
appeal the original Order Nisi of Foreclosure.  McEwan J. heard and
dismissed that application on November 30, 2011.  On September 18,
2012, the Applicants filed a motion in this Court to extend time to appeal the Order
of McEwan J.

[8]

On October 25, 2012, MacKenzie J.A. delivered oral reasons
dismissing the application to extend time.  In those reasons, she stated the
following:

[1]        I have read the history of this matter. All I can
say on this matter is that in relation to an extension of time to file an appeal
of Mr. Justice McEwans order pronounced November 30, 2011, there is no
merit to the application. The reason for that is the property has been sold.
The appeal is moot. The dispute is over and there is nothing more to argue
about.

[2]        In terms of your claim that the Royal Bank of
Canada could only be the mortgagee for the house and not the land, the dispute
is over. The mortgage contract is over. It has been carried out. Mr. Hlatky
was the mortgagor. He applied for the mortgage, signed a contract and the
mortgage went into default. It was foreclosed upon and then by court order, the
property was sold.

[3]        If you have a claim
that says the mortgage was invalid because it was made on Native or Indian
land, and the contract could only have involved the house, this Court cannot
deal with the matter now. I have no jurisdiction to deal with it. This is a statutory
court that deals with appeals. You will have to make a separate land claim in
another court. It is unlikely that you would be successful with respect to that
piece of property because a mortgage contract is very specific.

[9]

On November 23, 2012, the Applicants filed a motion for extension of time
to vary or discharge the Order of MacKenzie J.A.

[10]

Shortly after the decision of MacKenzie J.A., the Applicants
attempted to file an application for leave to appeal against her Order in the
Supreme Court of Canada.  They were advised by the Registrar of that Court that
they needed to exhaust all remedies in this Court first.  This meant they
needed to seek a review of MacKenzie J.A.s Order by a division of this
Court.

3.       Position
of the parties

[11]

Mr. Hlatky filed one affidavit in support of his application.  It
was not sworn by him, but apparently sworn by a Mr. Steemas who has been
helping the Applicants.  I refused to permit Mr. Steemas to speak on
behalf of the Applicants because I discerned, from my reading of the
transcripts in previous proceedings, he has been disruptive and unhelpful.  I
eventually permitted Mr. Hlatkys friend, Mr. Popois, to sit at
counsel table and assist him.

[12]

The position of the Applicants is that RBC had no ability to sell the
land because the land was not the subject of the mortgage; only the house was
subject to the mortgage.  The Applicants also say that they did not know they
only had seven days to apply for a review of an order of a chambers judge.  Finally,
the Applicants note that they did take steps to appeal the decision to the
Supreme Court of Canada.

[13]

RBC submits that the test to review the decision of a chambers judge
requires the Applicants to show that MacKenzie J.A. made an error of law
or principle, or misconceived the facts.  It argues that she made no such error
in dismissing the Applicants motion for an extension of time to appeal the Order
of McEwan J.  MacKenzie J.A. rightly dismissed an application for an
extension of time on the basis that the appeal lacked any merit.

[14]

In RBCs summary of the litigation, it notes that there have been
several concurrent applications before the Supreme Court, along with two
proceedings before the Federal Court.  They add that there are two
applications, including this one, before the Court of Appeal.  In all of these
proceedings, RBC argues, the Applicants are seeking the same or similar relief
based on the same allegations, which may be summarized as follows:

1.         RBC
had no authority to sell the Property (despite the fact that RBC never owned or
sold the Property);

2.         RBC
and its solicitors failed to produce documents related to the Property; and

3.         the Order Nisi, the Order for
Conduct of the Sale and the Order Approving Sale in the Foreclosure proceedings
were unlawful.

[15]

RBC alleges that in relation to the same foreclosure proceedings,
various courts have dismissed the Applicants applications on at least six
occasions.  Each time they were dismissed because the above-mentioned
allegations were raised without cause.  RBC further alleges that the Applicants
have repeatedly disobeyed court orders, requiring additional submissions and
applications from RBC.

[16]

RBC submits that they are prejudiced by the cost of this protracted litigation.
In addition, it submits that what the Applicants are really seeking is a
resolution by way of a land claim, which has nothing to do with RBC.  It
submits that if the Applicants wish to pursue their claim against the Property,
they should bring a proper action by way of a land claim.

[17]

In sum, RBC seeks (1) an order that the motion for appeal of Madam
Justice MacKenzies Order be dismissed; and (2) costs of this
application.

[18]

RBC also sought an order declaring the applicants vexatious litigants.  I
did not hear any submissions on this issue as there was no motion before the
court seeking such a remedy.

4.       Discussion

a.       Application
to extend time to review a decision of a justice

[19]

Pursuant to s. 9(6) of the
Court of Appeal Act
, a party may
apply for a review of a decision of a justice in chambers.  Rule 34 of the
Court of Appeal Rules
governs applications under this section.  Under
that rule, time has run out for the Applicants to file for a review.  In order
to obtain a review, they must obtain an extension of time to file the proper
forms and supporting documents.  Section 10(1) gives a justice sitting in
chambers the authority to extend time.

[20]

The criteria in an application for an extension
of time were set out in
Davies v. Canadian Imperial Bank of Commerce
(1987),
15 B.C.L.R. (2d) 256 at 259-260 (C.A.), and may be summarized as follows:

1)         Was there a bona fide intention
to appeal?

2)         When were the respondents
informed of the intention?

3)         Would the respondents be unduly
prejudiced by an extension of time?

4)         Is there merit in the appeal?

5)         Is it
in the interest of justice that an extension be granted?

[21]

The fifth question encompasses the other four
questions and states the decisive question (
Davies
at 260).  This
decisiveness has been repeatedly affirmed:
Kedia International Inc. v. Royal
Bank of Canada,

2008 BCCA 305 at para. 8 (Chiasson J.A. in
Chambers).

[22]

The burden is on the applicant to establish that the
criteria are met (see
Kedia
at para. 8
).

[23]

As RBCs primary objections to the extension of time are aimed at the
merit of the case and the interests of justice, I propose only to address these
issues.

[24]

MacKenzie J.A. found no merit in the appeal.  I have reviewed all
of the material that was before her.  I do not differ from her conclusion.  The
Property has been sold to a third party.  The Applicants cannot obtain what
they desire in this litigation.  This litigation is about failure to pay a debt
to RBC, not about a land claim.

[25]

In my respectful view, it would not be in the interests of justice to
grant an extension of time to file for a review, given the lack of merit in the
substance of the appeal.

[26]

I would dismiss the application for an extension of time to file a
review of the Order of MacKenzie J.A.

[27]

The Applicants have seven days from the issuance of these reasons to
apply to review my order.

[28]

RBC sought costs of this application.  This is the first time RBC has
sought costs throughout the litigation.  It is appropriate to order costs in a
fixed amount to avoid further litigation.  I order costs of $1,000 payable to
RBC by the Applicants forthwith.

b.       Order sought
by the Attorney General of Canada

[29]

The Attorney General of Canada was a party in the foreclosure
proceedings as a respondent (along with the Applicants) because it had
registered charges for taxes against Mr. Hlatkys interest in the Property.

[30]

When the appeal was filed, the Applicants unilaterally added the
Department of Indian and Northern Affairs to the style of cause.  The Attorney
General, on behalf of the Department, seeks to remove the latter from the style
of cause as a respondent.  It submits that the Department cannot be sued in
that name in any event pursuant to s. 23(2) of
the Crown Liability and
Proceedings Act
, R.S.C. 1985, c. C-50.

[31]

It seems the Applicants added the Department in a faint hope to
transform the litigation into a land claim.  Again, this is not the proper
litigation for that issue.  In the circumstances before this Court, it was not
proper to add the Department.

[32]

Although there is no separate application to remove the Department,
there was never an application to add it.  In my view, the Attorney General of Canada
is entitled to its order.  It would be a waste of time and money to require a
separate application to be made in order to obtain a remedy.

[33]

Therefore, I order that the Department of Indian and Northern Affairs be
deleted from the style of cause as a respondent, as it is not properly named as
a respondent in the action.

5.       Summary and disposition

[34]

The application to extend the time to file an application for review
from the decision of MacKenzie J.A. is dismissed.  The request to remove
the Department of Indian and Northern Affairs from the style of cause as a
respondent is granted.  The Applicants will pay costs to RBC in the amount of
$1,000.

The Honourable Madam Justice Bennett


