



COURT OF APPEAL FOR ONTARIO

CITATION: Stanbarr Services Limited v. Reichert, 2017 ONCA
    318

DATE: 20170418

DOCKET: C62223

Feldman, Cronk and Miller JJ.A.

BETWEEN

Stanbarr
    Services Limited, Kempston Grove Corp.,

617695
    Ontario Limited & Eddy Goldberg

Plaintiffs (Respondents)

and

Hans Jorg Reichert
& Marianne Reichert

Defendants (Appellant)

Ivan Y. Lavrence, for the appellant

Martin Greenglass, for the respondents

Heard: April 12, 2017

On appeal from the judgment of Justice Francine Van Melle
    of the Superior Court of Justice, dated May 12, 2016.

By the Court:

Introduction

[1]

The appellant, Hans Jorg Reichert, appeals from the judgment of Van
    Melle J. of the Superior Court of Justice dated May 12, 2016 ordering him to
    pay the respondent mortgagees the sum of $1,293,734.54 owing on a private,
    residential mortgage in the amount of $765,000 granted by the appellant to the
    respondents in February 2011 on his matrimonial home, together with costs in
    the amount of $26,000, plus pre-judgment interest.

[2]

The appellant raises two grounds of appeal.  He argues that the trial
    judge erred: i) by failing to grant an adjournment of the trial on May 12,
    2016, requested on that date by the appellants wife, Marianne Reichert; and
    ii) by proceeding to conduct the trial and grant judgment in favour of the
    respondents on May 12, 2016 in the appellants absence, and without continuing
    the trial to permit him an opportunity to attend and lead evidence in defence
    of the respondents action for payment of the mortgage debt.

[3]

The appellant also seeks leave to introduce fresh evidence on this
    appeal, consisting of documentation that he says demonstrates that he had
    relevant evidence to lead at trial in his defence of the mortgage action that
    was capable of yielding a different outcome.

[4]

For the reasons that follow, we conclude that the appeal must be
    dismissed.

Background in Brief

[5]

Default in payment on the second mortgage held by the respondents
    occurred in November 2011.  On April 18, 2013, the respondents obtained partial
    summary judgment for possession of the mortgaged premises.  In granting summary
    judgment, Bielby J. of the Superior Court of Justice rejected the appellants
    claim that he and his wife were merely tenants of the property and that the
    property was legally and beneficially owned by a family trust created by the
    appellant and his wife, rather than the appellant personally.  This court
    dismissed the appellants appeal from Bielby J.s judgment on October 2, 2013:
Reichert
    v. Stanbarr Services Limited
, 2013 ONCA 602.

[6]

Thereafter, a court-appointed receiver sold the mortgaged premises, with
    court approval.  The sale proceeds were insufficient to satisfy either the debt
    owing on a first mortgage on the property or any of the monies owing under the
    second mortgage held by the respondents.

[7]

The respondents action for payment of the mortgage debt was set down
    for trial in Brampton in December 2014, for an estimated six to ten days.  A
    pre-trial was conducted in June 2015 and the action was scheduled for trial
    during the week of February 22, 2016.  The appellant, who was then
    self-represented, was cautioned by the court to retain counsel if he wished to
    do so.

[8]

When a second pre-trial was held on February 22, 2016, the appellant
    sought and was granted an adjournment to afford him further time to retain
    counsel.  The case was marked peremptory to the appellant for trial in May
    2016.

[9]

On April 27, 2016, the appellant sued his former solicitor, who had furnished
    him with independent legal advice on the mortgage transaction with the
    respondents.  The appellant also moved for an order that the negligence action
    and the respondents mortgage action, together with certain other litigation,
    be consolidated or tried together and transferred to Toronto.  The motion did
    not proceed because the requisite confirmation notice had not been filed with
    the court.

[10]

By
    this time, the appellant had retained counsel.  A third pre-trial of the
    mortgage action was held in early May 2016.  On the day of the pre-trial,
    counsel informed the court that his retainer had been terminated.  The
    appellant again sought an adjournment of the trial.  His request was denied by
    the pre-trial judge.

[11]

On
    May 12, 2016, the respondents attended court with counsel and their witnesses
    for commencement of the trial.  Without prior notice to the respondents,
    neither the appellant nor any counsel on his behalf attended court.  Instead,
    the appellants wife appeared and again requested an adjournment of the trial,
    relying particularly on a doctors letter dated May 10, 2016, which stated that
    the appellant had suffered an emotional breakdown after the third pre-trial and
    that he would be unable to attend any court hearings and trials for at least a
    couple of months.  It also emerged that the appellant had failed to pay
    several outstanding costs orders and, according to his wife, had no funds to
    pay them or any costs that might be awarded to the respondents as a term of the
    requested adjournment, if granted.

[12]

After
    hearing submissions, the trial judge declined to grant the adjournment and
    proceeded with the trial in the appellants absence.  It is this discretionary decision
    that the appellant now attacks before this court.

Discussion

[13]

In our view, the trial judge was fully justified in refusing to grant
    the appellant a further adjournment of the trial.  By May 12, 2016, the action
    had been set down for trial for almost 17 months, three pre-trials had been
    conducted, the appellant had been warned of the need to retain counsel on a
    timely basis should he wish to do so, the trial had already once been adjourned
    at the appellants request and a new trial date  peremptory to the appellant 
    had been set, the appellant had retained, and terminated, the services of a
    solicitor, and the respondents and their counsel had prepared for trial and
    were ready, willing and able to proceed, together with their witnesses.

[14]

Further,
    the medical evidence proffered by the appellants wife indicated that the
    appellant would be unable to proceed with the trial for months, the appellant
    professed to have no funds to pay the respondents costs thrown away should an
    adjournment be granted, and several previous costs orders against the appellant,
    some in respect of the same litigation, remained unpaid.

[15]

In
    all these circumstances, the granting of a further adjournment would have been
    manifestly unfair to the respondents and contrary to the interests of justice
    and judicial economy.  It was open to the trial judge to deny an adjournment,
    in the exercise of her discretion.  This was her call to make and we see no
    basis for appellate interference with her ruling.

[16]

Nor
    do we accept the appellants assertion that the trial unfairly proceeded in his
    absence.

[17]

Contrary
    to the appellants submission, it appears that the trial judge made no
    direction that, at the conclusion of the respondents evidence, the trial would
    be adjourned until May 16, 2016 for the purpose of allowing the appellant to
    attend trial and call evidence.  Instead, the trial judge offered to adjourn
    the trial for a few days and also invited the appellants wife to remain and
    participate in the trial on behalf of the appellant.

[18]

However,
    the appellants wife refused either accommodation.  As Roberts J.A. of this
    court noted at para. 21 of her reasons on a motion for security for costs in
    this matter, dated October 18, 2016:

Moreover, the trial judges exchanges with Ms. Reichert
    demonstrate that the offer of a few days adjournment was conditional on Ms.
    Reicherts confirmation that the appellant would appear in a few days time. 
    When Ms. Reichert declined to remain without agreeing to the offer of a few
    days adjournment, the trial judge stated clearly that the trial would proceed
    in the appellants absence.

[19]

In
    any event, based on the doctors May 10 letter provided to the trial judge by
    the appellants wife, no reasonable expectation could have arisen that the
    appellant would be available for trial by May 16.  Nor did the appellants wife
    suggest to the contrary or that counsel for the appellant would be able to
    attend court on May 16 or that she would herself be prepared to act as the
    appellants agent for the conduct of his defence.  Instead, in effect, an
    adjournment of an unspecified, but lengthy, duration was sought.

[20]

Moreover,
    and importantly, the record does not support the appellants claim that he was
    denied procedural fairness because the trial judge denied his adjournment
    request without fully hearing from the parties.  The trial judge heard
    submissions from the parties  including from the appellants wife  before
    ruling on the request.

[21]

Finally,
    we are not persuaded that the fresh evidence sought to be tendered on appeal by
    the appellant, if admitted at trial, would have yielded a different outcome.

[22]

The
    appellant sought to defend the mortgage action solely on the basis that a
    family trust, rather than the appellant, was the legal and beneficial owner of
    the mortgaged property and liable for the mortgage debt.  This claim was
    unequivocally rejected by Bielby J. when he granted judgment to the respondents
    for possession of the property.  It is also unsupported by the mortgage itself,
    including the standard charge terms containing the appellants covenant to pay,
    the certificate of independent legal advice furnished by the appellants
    solicitor in relation to the mortgage transaction, the mortgage commitment
    letter, and various other documents related to the mortgage loan.  In any
    event, in documents filed with the court by the appellant on a summary judgment
    motion in his solicitors negligence action, the appellant expressly
    acknowledged that he, rather than the trust, was the legal owner of the
    mortgaged property and that the relevant mortgage documents contained his
    personal covenant to repay the mortgage loan.  He has therefore now essentially
    admitted that the defence sought to be advanced by him in the mortgage action
    is factually and legally unsupportable.

[23]

For
    all these reasons, the appellants proposed defence of the action and this
    appeal are devoid of merit.

Disposition

[24]

The
    appellants application for leave to admit fresh evidence on appeal and the
    appeal are both dismissed.  The respondents are entitled to their costs of the
    appeal, fixed in the amount of $15,000, inclusive of disbursements and all
    applicable taxes.

[25]

The
    sum of $10,000 is currently held in court as security for the costs of this
    appeal. These funds shall be paid out of court to the respondents solicitors,
    in trust, in partial satisfaction of the costs of the appeal now awarded to the
    respondents, upon request therefor in proper form filed by the respondents.

K. Feldman J.A.

E.A. Cronk J.A.

B.W. Miller J.A.


