Trinier v. Shurnaik, 2011 ABCA 314

• Court: Court of Appeal (Alberta)
• Judge: Belzil,C,Paperny
• Neutral Citation: 2011 ABCA 314
• Citation: 2011 ABCA 314,(2011), 515 A.R. 148,515 AR 148,(2011), 515 AR 148,515 A.R. 148
• Date: 07 September 2011
• Subject Matter: GUARANTEE AND INDEMNITY,SUBROGATION,PRACTICE,CHOSES IN ACTION

Trinier v. Shurnaik (2011), 515 A.R. 148; 532 W.A.C. 148 (CA)

MLB headnote and full text

Temp. Cite: [2011] A.R. TBEd. NO.047

Mark Wesley Trinier also known as Mark Trinier and Deborah Ellen Trinier also known as Debbie Trinier (appellants/defendants) v. Donald Shurnaik and Debbie Shurnaik (respondents/defendants) and Alberta Treasury Branches (not a party to the appeal/plaintiff) and Weatherlok Canada Inc. (not a party to the appeal/defendant)

(1103-0033-AC; 2011 ABCA 314)

Indexed As: Trinier v. Shurnaik

Alberta Court of Appeal

Côté and Paperny, JJ.A., and Belzil, J.(ad hoc)

November 4, 2011.

Summary:

The Triniers and the Shurnaiks were two couples who guaranteed loans to a company. The lender sued on the guarantees. The guarantees provided for costs "as between solicitor and his own client on a full indemnity basis". The Shurnaiks neither paid nor defended. In 2004, the lender obtained default judgment against the Shurnaiks. The Triniers paid the entire debt. The lender assigned the default judgment and also the costs (present and future) to the Triniers. The Triniers sought contribution from the Shurnaiks.

The Alberta Court of Queen's Bench, in a decision reported at [2011] A.R. Uned. 55, found, inter alia, that the Triniers had no contractual entitlement to solicitor and client costs. The Triniers appealed.

The Alberta Court of Appeal allowed the appeal, reinstating several formal orders as settled by the Deputy Clerk and a former costs order that had been set aside in the decision appealed from. The court awarded the Triniers solicitor and client (full indemnity) costs for all steps to date.

Choses in Action - Topic 4064

Rights and liabilities of parties - Rights of assignees - Against debtor - [See Guarantee and Indemnity - Topic 2006 ].

Guarantee and Indemnity - Topic 2006

Relations between co-sureties - General - Effect of payment by one surety - The Triniers and the Shurnaiks were two couples who guaranteed loans to a company - The lender sued on the guarantees - The guarantees provided for costs "as between solicitor and his own client on a full indemnity basis" - The Shurnaiks neither paid nor defended - In 2004, the lender obtained default judgment against the Shurnaiks - The Triniers paid the entire debt - The lender assigned the default judgment and also the costs (present and future) to the Triniers - The Triniers sought contribution from the Shurnaiks - A chambers judge found, inter alia, that the Triniers had no contractual entitlement to solicitor and client costs - The Alberta Court of Appeal allowed the Triniers' appeal - Where a guarantor paid the creditor the debt guaranteed (not merely the guarantor's proportionate share), the guarantor became subrogated to the rights of the creditor - That subrogation gave the guarantor every remedy, security and means of payment that the creditor had against the other guarantors - The subrogation was automatic and did not depend on other contracts, such as an assignment - The guarantee was to enforce the loan agreements, which were assigned - The costs incurred by the Triniers in trying to collect from the Shurnaiks were incurred under all of the documents (the loan agreements, the guarantees and the assignment) - See paragraphs 31 to 38.

Practice - Topic 3198

Appearance and default proceedings - Proceedings in default of appearance - Default judgment - Requirement of debt or liquidated demand - [See first Practice - Topic 5609 ].

Practice - Topic 3229

Appearance and default proceedings - Proceedings in default of defence - Default judgment - Requirement of debt or liquidated demand - [See first Practice - Topic 5609 ].

Practice - Topic 5609

Judgments and orders - Default judgments - Effect of - The Triniers and the Shurnaiks were two couples who guaranteed loans to a company - The lender sued on the guarantees - The guarantees provided for costs "as between solicitor and his own client on a full indemnity basis" - The Shurnaiks neither paid nor defended - In 2004, the lender obtained default judgment against the Shurnaiks - The Triniers paid the entire debt - The lender assigned the default judgment and also the costs (present and future) to the Triniers - The Triniers sought contribution from the Shurnaiks - A chambers judge found, inter alia, that the Triniers had no contractual entitlement to solicitor and client costs - The Alberta Court of Appeal allowed the Triniers' appeal - The court rejected the argument that a default judgment could not give solicitor and client costs - Default judgments were given by the clerk of the court who had a very clear power to grant judgment for any liquidated claim pled after default - See paragraphs 71 to 78.

Practice - Topic 5609

Judgments and orders - Default judgments - Effect of - [See first Practice - Topic 7470.4 ].

Practice - Topic 6073

Judgments and orders - Payment of judgments - Effect of assignment - [See Guarantee and Indemnity - Topic 2006 ].

Practice - Topic 6931

Costs - General principles - Discretion of court - The Triniers and the Shurnaiks were two couples who guaranteed loans to a company - The lender sued on the guarantees - The guarantees provided for costs "as between solicitor and his own client on a full indemnity basis" - The Shurnaiks neither paid nor defended - In 2004, the lender obtained default judgment against the Shurnaiks - The Triniers paid the entire debt - The lender assigned the default judgment and also the costs (present and future) to the Triniers - The Triniers sought contribution from the Shurnaiks - A chambers judge found, inter alia, that the Triniers had no contractual entitlement to solicitor and client costs - On the Triniers' appeal, the Shurnaiks asserted, inter alia, that the chambers judge had a discretion to deny solicitor and client costs - The Alberta Court of Appeal indicated that, given the express covenants for solicitor and client costs here, the existence of such a discretion was "doubtful" - Even if a discretion existed for certain items, there was no proper legal ground for exercising it - See paragraphs 39 to 42.

Practice - Topic 7407

Costs - Solicitor and client costs - General principles - Power to award solicitor and client costs - [See first Practice - Topic 5609 and Practice - Topic 6931 ].

Practice - Topic 7470.4

Costs - Solicitor and client costs - Entitlement to solicitor and client costs - Indemnity agreements - The Triniers and the Shurnaiks were two couples who guaranteed loans to a company - The lender sued on the guarantees - The guarantees provided for costs "as between solicitor and his own client on a full indemnity basis" - The Shurnaiks neither paid nor defended - In 2004, the lender obtained default judgment against the Shurnaiks - The Triniers paid the entire debt - The lender assigned the default judgment and also the costs (present and future) to the Triniers - The Triniers sought contribution from the Shurnaiks - A chambers judge found, inter alia, that the Triniers had no contractual entitlement to solicitor and client costs because only the default judgment and the debt were assigned - The Alberta Court of Appeal allowed the Triniers' appeal - The guarantees expressly called for solicitor and own client costs - This was not a contract with strangers - No assignment was necessary - All of the costs were incurred on the action on the guarantees - That action, the payment, the default judgment and all steps since were all on the guarantees - The proceedings were against the guarantors - That alone sufficed to found all of the solicitor and client costs in question - See paragraphs 8 to 17.

Practice - Topic 7470.4

Costs - Solicitor and client costs - Entitlement to solicitor and client costs - Indemnity agreements - The Triniers and the Shurnaiks were two couples who guaranteed loans to a company - The lender sued on the guarantees - The guarantees provided for costs "as between solicitor and his own client on a full indemnity basis" - The Shurnaiks neither paid nor defended - In 2004, the lender obtained default judgment against the Shurnaiks - The Triniers paid the entire debt - The lender assigned the default judgment and also the costs (present and future) to the Triniers - The Triniers sought contribution from the Shurnaiks - A chambers judge found, inter alia, that the Triniers had no contractual entitlement to solicitor and client costs because he was "not prepared to 'read in' a reference to solicitor-client costs to either the Default Judgment or the Assignment" - The Alberta Court of Appeal allowed the Triniers' appeal - The various covenants for solicitor and client costs were "incontestible" - The Shurnaiks did not defend and default judgment was signed against them - The default judgment taxed solicitor and client costs against the Shurnaiks - Further, where, as here, there was an express covenant for solicitor and client costs, there was no reason to presume that a judgment did not speak of them - See paragraphs 18 to 30.

Practice - Topic 7808

Costs - Solicitor and his own client costs - Agreements - Validity of - [See both Practice - Topic 7470.4 ].

Subrogation - Topic 10

General - Necessity for contract - [See Guarantee and Indemnity - Topic 2006 ].

Cases Noticed:

Hill v. Stephen Motor, [1929] 2 W.W.R. 97 (Sask. C.A.), refd to. [para. 20].

Sulef v. Parkin (1966), 57 W.W.R.(N.S.) 236 (Alta. C.A.), refd to. [para. 20].

McElroy v. Cowper-Smith, [1967] S.C.R. 425; 60 W.W.R.(N.S.) 85, refd to. [para. 20].

Brennan v. Arcadia Coal Co., [1929] 3 W.W.R. 446; 24 Alta. L.R. 236 (C.A.), refd to. [para. 22].

Spiller v. Brown, [1973] 6 W.W.R. 663 (Alta. C.A.), refd to. [para. 22].

Yaremchuk et al. v. Haight et al. (2001), 277 A.R. 160; 242 W.A.C. 160; 6 C.P.C.(5th) 112; 2001 ABCA 7, refd to. [para. 22].

Klinck v. Drinnan (1985), 66 A.R. 321; 41 Alta. L.R.(2d) 299 (Q.B.), refd to. [para. 23].

Schwartz et al. v. Stinchcombe et al. (1994), 152 A.R. 241; 18 Alta. L.R.(3d) 358 (Q.B.), refd to. [para. 23].

Syncrude Canada Ltd. v. Tibo Steel Products Ltd. et al. (2001), 292 A.R. 368; 2001 ABQB 478, refd to. [para. 23].

Dykes v. Goczan (No. 1) (1996), 188 A.R. 352 (Q.B.), refd to. [para. 23].

Robinson et al. v. Fiesta Hotel Group Resorts et al., [2008] 12 W.W.R. 152; 450 A.R. 167; 91 Alta. L.R.(4th) 158; 2008 ABQB 311, refd to. [para. 23].

Dyck et al. v. Wilkinson et al., [2004] A.R. Uned. 657; 2004 ABQB 731, refd to. [para. 23].

Arbitus Leasing Ltd. v. X-Zibit A Inc. (2006), 405 A.R. 288; 2006 ABQB 764, dist. [para. 27].

Que Jacques-Cartier Electric Co. v. R. (R. v. Frontenac Gas Co.) (1915), 51 S.C.R. 594, refd to. [para. 28].

Standish Hall Hotel v. R., [1963] S.C.R. 64; 35 D.L.R.(2d) 140, refd to. [para. 28].

Johnson Est, Re (1957), 21 W.W.R.(N.S.) 289 (Sask. C.A.), refd to. [para. 28].

Elliott v. Hill Brothers Expressways Ltd. et al. (1999), 232 A.R. 258; 195 W.A.C. 258 (C.A.), refd to. [para. 29].

Smith and McPherson, Re (1921), 51 O.L.R. 457; 69 D.L.R. 477 (C.A.), refd to. [para. 29].

Royal Bank of Canada v. Fox et al., [1976] 2 S.C.R. 2; 6 N.R. 382; 59 D.L.R.(3d) 258, refd to. [para. 32].

Stratford Fuel Ice Co., Re (1914), 50 S.C.R. 100, refd to. [para. 33].

Royal Trust Corp. of Canada v. Rick Holdings Ltd. et al. (1999), 250 A.R. 156; 213 W.A.C. 156; 1999 ABCA 187, refd to. [para. 33].

Hillas (William) & Co. v. Arcos, [1932] U.K.H.L. 2; 147 L.T. 503, refd to. [para. 34].

British American Assurance v. Law (William) & Co. (1892), 21 S.C.R. 325, refd to. [para. 34].

Mills v. Dunham, [1891] 1 Ch. 576; 60 L.J. Ch. 362 (C.A.), refd to. [para. 34].

Wright v. Rosen (Murray) Professional Corp. et al., [2005] A.R. Uned. 44; 2005 ABCA 116, refd to. [para. 63].

Csepregi v. Bygrove et al., [2001] A.R. Uned. 31; 2001 ABCA 108, refd to. [para. 63].

Thimer v. Workers' Compensation Board Appeals Commission (Alta.) (2000), 276 A.R. 235; 2000 ABQB 706, refd to. [para. 63].

Davidson v. Patten et al., [2006] A.R. Uned. 318; 2006 ABQB 370, refd to. [para. 77].

Collings, Re, [1936] S.C.R. 613; [1937] 1 D.L.R. 410, refd to. [para. 77].

Authors and Works Noticed:

Broom, Herbert, A Selection of Legal Maxims, Classified and Illustrated (10th Ed. 1939), pp. 361 to 369 [para. 34].

Burrows, Interpretation of Documents (2nd Ed. 1946), pp. 92 to 94 [para. 34].

Fridman, Gerald Henry Louis, Restitution (2nd Ed. 1992), pp. 402 [para. 33]; 403 [paras. 32, 33].

Goff, Robert, and Jones, Gareth, The Law of Restitution (7th Ed. 2007), paras. 3-009 [para. 32]; 3-025 [paras. 32, 33]; 3-027 [para. 33].

Halsbury's Laws of England (4th Ed. 1976), §§ 1172, 1173, 1559 to 1561 [para. 24].

Maddaugh, Peter D., and McCamus, John D., The Law of Restitution (2nd Ed. 2004), pp. 8-1, 8-2 [para. 32].

Stevenson, William A., and Côté, Jean E., Civil Procedure Encyclopedia (2003), c. 18, Part N, pp. 18-19, 18-20 [para. 67].

Williston and Rolls, The Law of Civil Procedure (1970), p. 1046 [para. 29].

Counsel:

N.D. Anderson, for the appellants;

G.J. Lintz, for the respondents.

This appeal was heard on September 7, 2011, by Côté and Paperny, JJ.A., and Belzil, J.(ad hoc), of the Alberta Court of Appeal. On November 4, 2011, Côté, J.A., delivered the following reasons for judgment for the court.