MacKay et al. v. MacMillan, (2009) 285 N.S.R.(2d) 118 (SC)

• Judge: LeBlanc, J.
• Court: Supreme Court of Nova Scotia (Canada)
• Case Date: October 24, 2008
• Jurisdiction: Nova Scotia
• Citations: (2009), 285 N.S.R.(2d) 118 (SC);2009 NSSC 330

MacKay v. MacMillan (2009), 285 N.S.R.(2d) 118 (SC);

    905 A.P.R. 118

MLB headnote and full text

Temp. Cite: [2009] N.S.R.(2d) TBEd. DE.049

Keith MacKay, Assignee of Blair Hendren (plaintiff) v. Charles MacMillan (defendant)

(Hfx. No. 290524; 2009 NSSC 330)

Indexed As: MacKay et al. v. MacMillan

Nova Scotia Supreme Court

LeBlanc, J.

November 6, 2009.

Summary:

The plaintiff judgment creditor (MacKay) was the assignee of a judgment entered against the defendant judgment debtor (MacMillan) in 1988. The original judgment creditor (Hendren) made no efforts to enforce the judgment. In 2007, the plaintiff judgment creditor (MacKay) was granted an ex parte order renewing the execution order. The judgment debtor (MacMillan) applied, inter alia, to stay the execution order.

The Nova Scotia Supreme Court held that the ex parte order granting leave to renew the execution order should not have been granted because the delay in enforcing the judgment was not adequately explained. The court therefore set aside the ex parte order.

Bankruptcy - Topic 9217

Discharge of trustee - General principles - Appointment of trustee by court to complete administration - Hendren obtained default judgment against MacMillan on March 25, 1988 - An execution order was granted on April 13, 1988 - Hendren made an assignment in bankruptcy in November 1988 and was discharged in November 1990 - There was no record of any attempt by Hendren's trustee in bankruptcy to collect from MacMillan - Hendren assigned the judgment to MacKay - In 2007 MacKay sought to execute on the judgment - MacKay obtained a quit claim release of any interest from the former trustee - An issue arose as to the status of the judgment having regard to the fact that no steps were taken by the trustee to restore the unrealized judgment to the bankrupt, Hendren, once he was discharged - The Nova Scotia Supreme Court held that in the circumstances the appropriate route was to reappoint the bankruptcy trustee under s. 41(11) of the Bankruptcy and Insolvency Act to effect the transfer - See paragraphs 15 to 20.

Execution - Topic 480

General rules - Stay of execution - Grounds - [See Practice - Topic 5854 ].

Execution - Topic 1041

Writ of execution - Renewal - General - The Nova Scotia Supreme Court reviewed the general principles applicable in determining when an execution order could be renewed - See paragraph 36.

Execution - Topic 1044

Writ of execution - Renewal - Delay - [See Practice - Topic 5854 ].

Execution - Topic 3826

Sale of land of judgment debtor - Interests which may be sold - Joint interests - [See Practice - Topic 682 ].

Practice - Topic 682

Parties - Adding or substituting parties - Intervenors - Interest in subject matter - A judgment creditor sought to sell the judgment debtor's (MacMillan's) land - The judgment debtor's wife sought to intervene - The wife was the joint tenant of the property subject to the execution order - The Nova Scotia Supreme Court refused to allow the intervention - Under the Sale of Lands under Execution Act it was clear that only MacMillan's interest would be sold - The wife had no right under the statute to prevent the sale of MacMillan's interest in the property - After the sale, the joint tenancy would be severed - The court stated that it might also be the case that service of the Notice of Sale (rather then the sale itself) on MacMillan effectively severed the joint tenancy - The court was satisfied that there was no direct interest on the part of the wife - See paragraphs 5 to 9.

Practice - Topic 5854

Judgments and orders - Enforcement of judgments - Stay of - Hendren obtained default judgment against MacMillan on March 25, 1988 - An execution order was granted on April 13, 1988 - Hendren did not pursue execution of the judgment - Hendren made an assignment in bankruptcy in November 1988 and was discharged in 1990 - Hendren assigned the judgment to MacKay - In December 2007, MacKay obtained an ex parte order renewing the execution order - MacMillan sought to stay the execution order permanently pursuant to Civil Procedure Rule 53.13 for special circumstances or other just cause (e.g., laches) - MacKay submitted that the delay was reasonably explained (i.e., because it had been financially impractical for Hendren to collect on the judgment debt) - The Nova Scotia Supreme Court found that the creditor (MacKay), including the original creditor (Hendren), did not act with reasonable diligence in attempting to collect on the judgment in the circumstances - The court noted that almost immediately after judgment, Hendren entered bankruptcy proceedings and there was thereafter no attempt by Hendren to collect - MacKay (and for that matter Hendren) did not adequately explain the reasons for the delay or lack of efforts to enforce the judgment - There would be prejudice to the joint tenant if the property was sold and the prejudice arising from maintaining the execution order greatly outweighed the prejudice to the judgment creditor (MacKay) arising from the stay - The court therefore set aside the ex parte order granting leave to renew the execution order - See paragraphs 21 to 57.

Practice - Topic 6199

Judgments and orders - Setting aside default judgments (incl. noting in default) - Delay in applying - In 2008, a judgment debtor faced with an execution order sought to set aside the underlying default judgment which had been entered against him in 1988 - He claimed that he had a good defence (i.e., that the amount was fully paid and the creditor sued the wrong party) - He also claimed that when the originating notice was served on him in 1988, he was having significant health problems and personal issues and did not turn his mind to filing a defence - The Nova Scotia Supreme Court refused to set aside default judgment - While there was an arguable defence, the judgment debtor did not establish a reasonable excuse for the delay in filing a defence - He took no steps in 1988 or thereafter to set aside the judgment until prompted by the upcoming sale of his property - There was unreasonable delay in seeking to set aside default judgment - Setting aside the default judgment would visit insurmountable prejudice to the judgment creditor by forcing him to prove a debt which was over 20 years old - See paragraphs 10 to 14.

Practice - Topic 6201

Judgments and orders - Setting aside default judgments (incl. noting in default) - Requirement of reasonable excuse for default - [See Practice - Topic 6199 ].

Cases Noticed:

MacLellan Lincoln Mercury Ltd. v. Jacobsen (2008), 265 N.S.R.(2d) 258; 848 A.P.R. 258; 2008 NSCA 45, refd to. [paras. 2, 29].

L&B Electric Ltd. v. Oickle (2006), 249 N.S.R.(2d) 346; 792 A.P.R. 346 (C.A.), refd to. [para. 7].

Logic Alliance Inc. v. Jentree Canada Inc. (2005), 229 N.S.R.(2d) 127; 725 A.P.R. 127 (S.C.), refd to. [para. 11].

Ives v. Dewar, [1949] 2 D.L.R. 204 (N.S.C.A.), refd to. [para. 11].

Temple v. Riley (2001), 191 N.S.R.(2d) 87; 596 A.P.R. 87; 2001 NSCA 36, refd to. [para. 12].

Thompson v. Coulombe, German-Coulombe, Marier and Les Services sanitaires Champlain Ltée (1984), 54 C.B.R.(N.S.) 254 (Que. C.A.), refd to. [para. 20].

Fulton Insurance Agencies Ltd. v. Purdy (1990), 100 N.S.R.(2d) 341; 272 A.P.R. 341; 1990 CarswellNS 344 (C.A.), refd to. [para. 26].

Whebby (W.E.) Ltd. v. Boehner (D.) Trucking & Excavating Ltd. et al. (2006), 249 N.S.R.(2d) 326; 792 A.P.R. 326; 2006 CarswellNS 531; 2006 NSCA 129, refd to. [para. 28].

Commercial Credit Plan Ltd. v. MacLeod and MacLeod (1986), 75 N.S.R.(2d) 197; 186 A.P.R. 197 (T.D.), refd to. [para. 30].

N.S. Tractors & Equipment Ltd. v. Morton (1986), 79 N.S.R.(2d) 59; 196 A.P.R. 59 (T.D.), refd to. [para. 30].

Windy Bay Fisheries Ltd. v. Joseph (Neiff) Land Surveyors Ltd. (1996), 157 N.S.R.(2d) 367; 462 A.P.R. 367 (C.A.), refd to. [para. 33].

Harris v. Lindeborg, [1931] S.C.R. 235, refd to. [para. 40].

K.M. v. H.M., [1992] 3 S.C.R. 6; 142 N.R. 321; 57 O.A.C. 321; 1992 CarswellOnt 841, refd to. [para. 41].

South Holly Holdings Ltd. v. Nguyen et al., [2006] O.T.C. 1507 (Sup. Ct.), refd to. [para. 48].

Statutes Noticed:

Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, sect. 41(10), sect. 41(11) [para. 16].

Civil Procedure Rules (N.S.), rule 8.01 [para. 5]; rule 53.13 [para. 23].

Rules of Civil Procedure (N.S.) - see Civil Procedure Rules (N.S.).

Rules of Court (N.S.) - see Civil Procedure Rules (N.S.).

Authors and Works Noticed:

Anger and Honsberger, The Law of Real Property, pp. 14 to 17 [para. 8].

Mew, Graeme, The Law of Limitations (2nd Ed. 2004), pp. 39, 40 [para. 42].

Counsel:

Keith MacKay, self-represented;

Robert J. McCleave, for the defendant.

This matter was heard in Halifax, Nova Scotia, on October 24, 2008, before LeBlanc, J., of the Nova Scotia Supreme Court, who delivered the following decision on November 6, 2009.