iNova Credit Union Ltd. v. Giamac Inc. et al., (2012) 323 N.S.R.(2d) 176 (SC)

• Judge: Wood, J.
• Court: Supreme Court of Nova Scotia (Canada)
• Case Date: December 10, 2012
• Jurisdiction: Nova Scotia
• Citations: (2012), 323 N.S.R.(2d) 176 (SC);2012 NSSC 431

iNova Credit v. Giamac Inc. (2012), 323 N.S.R.(2d) 176 (SC);

    1025 A.P.R. 176

MLB headnote and full text

Temp. Cite: [2012] N.S.R.(2d) TBEd. DE.045

iNova Credit Union (plaintiff) v. Giamac Inc. (defendant) and Gerald Giovannetti (defendant/guarantor) and Attorney General of the Province of Nova Scotia (intervenor) and Alfred Smithers and Edward Webber (parties to the motion)

(Hfx. No. 382080; 2012 NSSC 431)

Indexed As: iNova Credit Union Ltd. v. Giamac Inc. et al.

Nova Scotia Supreme Court

Wood, J.

December 11, 2012.

Summary:

At a foreclosure sale, the Sheriff sold the property to the second highest bidder, when the highest bidder failed to provide the required deposit in the 22 minute time period set by the Sheriff. The unsuccessful highest bidder applied to set the sale aside.

The Nova Scotia Supreme Court dismissed the application.

Mortgages - Topic 5506

Mortgage actions - Action for foreclosure and sale - Application for sale - Procedure - The Nova Scotia Supreme Court reviewed the procedure for foreclosure sales in Nova Scotia - The court stated, inter alia, that a Sheriff had the discretion to deal with a situation where a purchaser did not have the required deposit immediately available at the conclusion of the sale - In exercising that discretion, a Sheriff had to act reasonably - Circumstances such as the number of bidders, adequacy of the sale price and potential prejudice to the mortgagee or others, were all relevant considerations - See paragraphs 18 to 29.

Mortgages - Topic 5506

Mortgage actions - Action for foreclosure and sale - Application for sale - Procedure - At a foreclosure sale there were multiple bidders prepared to pay more than the amount owing to the mortgagee - The Sheriff sold the property to the second highest bidder when the person who made the highest bid (i.e., an agent (and principal) of the defaulting mortgagor) failed to provide the required deposit within the 22 minute time period set by the Sheriff - The unsuccessful highest bidder applied to set aside the sale, challenging the reasonableness of the Sheriff's imposition of the 22 minute deadline and complaining about the adequacy of the deposit posted by the second highest bidder and the Sheriff's handling of that deposit - The Nova Scotia Supreme Court dismissed the application - The decisions made and procedures followed by the Sheriff were reasonable - Further, there were no special circumstances that would justify setting aside the sale - See paragraphs 31 to 51.

Mortgages - Topic 5507

Mortgage actions - Action for foreclosure and sale - Foreclosure order - General - [See both Mortgages - Topic 5506 ].

Mortgages - Topic 5520

Mortgage actions - Action for foreclosure and sale - Practice - [See both Mortgages - Topic 5506 ].

Mortgages - Topic 5581

Mortgage actions - Setting aside a judicial or foreclosure sale - General - [See second Mortgages - Topic 5506 ].

Mortgages - Topic 5584

Mortgage actions - Setting aside a judicial or foreclosure sale - Grounds - General - [See second Mortgages - Topic 5506 ].

Mortgages - Topic 5585

Mortgage actions - Setting aside a judicial or foreclosure sale - Procedural error - [See second Mortgages - Topic 5506 ].

Mortgages - Topic 5592

Mortgage actions - Foreclosure sale - Setting aside a judicial or foreclosure sale on the ground of inadequacy of price plus other special circumstances - [See second Mortgages - Topic 5506 ].

Cases Noticed:

Zinck v. Lobster Point Realty Corp., [1953] 1 S.C.R. 285, refd to. [para. 22].

Atlantic Trust Co. v. H. & E. General Stores Ltd. et al. (1977), 25 N.S.R.(2d) 526; 36 A.P.R. 526, refd to. [para. 23].

Nova Scotia Savings & Loan Co. v. Hill and Hill (1981), 45 N.S.R.(2d) 689; 86 A.P.R. 689, refd to. [para. 25].

McInnes Cooper & Robertson v. Sea Star Developments Ltd. (1997), 164 N.S.R.(2d) 60; 491 A.P.R. 60, refd to. [para. 26].

Maritime Form Work v. Sea Star Developments Ltd. - see McInnes Cooper & Robertson v. Sea Star Developments Ltd.

Royal Bank of Canada v. Bonnar et al., (2007), 262 N.S.R.(2d) 60; 839 A.P.R. 60, refd to. [para. 38].

Statutes Noticed:

Civil Procedure Rules (N.S.), Practice Memorandum No. 1, sect. 2(b) [para. 18]; sect. 2(c) [para. 19]; sect. 4 [para. 19].

Practice Memorandum No. 1 - see Civil Procedure Rules (N.S.), Practice Memorandum No. 1.

Counsel:

Lloyd R. Robbins, for iNova Credit Union, the plaintiff;

Paul B. Miller, for Giamac Inc., defendant, and Gerald Giovannetti, defendant/ guarantor;

Richard Arab, for the Attorney General of Nova Scotia, intervenor;

Gavin D.F. MacDonald and Mark Mills (Articled Clerk), for Alfred Smithers, a party to the motion;

Blair Mitchell, for Edward Webber, a party to the motion.

This application was heard in Halifax, Nova Scotia, on December 10, 2012, before Wood, J., of the Nova Scotia Supreme Court, who rendered a decision orally on December 11, 2012, with written reasons released on December 14, 2012.