Graham v. Moore Estate

2002BCCA0353 Citation: Graham and Ferrier v. Moore Estate Date: 20020603 2002 BCCA 353 Docket: CA029741 COURT OF APPEAL FOR BRITISH COLUMBIA BETWEEN: NANCY JANE GRAHAM and DONALD JAMES FERRIER RESPONDENTS (PLAINTIFFS) AND: MILDRED ELIZABETH MOORE, aka MILDRED ELISABETH MOORE, aka MILDRED E. MOORE, THE BANK OF NOVA SCOTIA TRUST COMPANY (formerly known as Montreal Trust Company of Canada) AND BARRIE WENDELL MOORE in their capacities as the Executors of the estate of MILDRED ELIZABETH MOORE, BARRIE WENDELL MOORE, in his personal capacity RESPONDENTS (DEFENDANTS) AND: BERNARD CAMPA APPELLANT (DEFENDANT) AND: THE BANK OF NOVA SCOTIA TRUST COMPANY RESPONDENT (DEFENDANT BY COUNTERCLAIM) Before: The Honourable Madam Justice Huddart (In Chambers) B.E. McLeod Counsel for the Appellant D. Church J. Milton G.A. Phillips Counsel for the Respondents, Graham and Ferrier Counsel for the Respondents, Nova Scotia Trust Company Counsel for the Respondent, Barrie Moore Place and Date of Hearing: Vancouver, British Columbia 28 May 2002 Place and Date of Judgment: Vancouver, British Columbia 3 June 2002 Reasons for Judgment of the Honourable Madam Justice Huddart: [1] These applications flow from a dispute between potential purchasers of a residential property at 2785 West 30th Avenue in Vancouver. After a five-day summary trial, Justice Melnick ordered the executors of the Moore estate to convey the property to the respondent plaintiffs, Drs. Graham and Ferrier, upon payment of $752,000.00 as adjusted in accordance with a contract for purchase and sale executed by both executors on 5 April 2001, confirming an agreement made 30 March 2001 by BNS Trustco with the authority of its co-executor, Barrie Moore. At the same time, Justice Melnick dismissed the appellant's claim for specific performance of an alleged agreement between him and the estate executed only by Barrie Moore (the April 2nd agreement) and an earlier alleged agreement that the executors would accept the bid made before 5 p.m. on March 29 that would produce the most net proceeds to the estate (the bidding agreement). [2] The appellant seeks a stay of execution of that order; the respondents seek orders for security for costs whether or not the stay is granted. [3] The first consideration on both applications is the potential merit of the appeal, at the heart of which is the question whether the summary trial judge may have erred in severing the issue of entitlement to title to the property from the issue of damages for torts allegedly committed in the course of negotiations for the sale of that property. [4] Both executors support the decision of the trial judge. They agree Drs. Graham and Ferrier are entitled to specific performance. [5] By his notice of appeal, the appellant seeks an order setting aside the order of specific performance and remitting the matter to the Supreme Court for a trial of all the issues raised in both the claim and counterclaim. That trial would commence in June 2003. He says the result of the specific performance order was to preclude him from making a better offer for the property and having that offer considered by the executors. His entitlement to this opportunity is founded on what he calls the "bidding agreement," and the trial judge called the "meet or beat agreement," as will I in these reasons. [6] The fundamental ground of appeal is that some findings of fact the trial judge made at the summary trial may embarrass the court in its consideration of the issues remaining to be decided on the counterclaim. In support of that proposition, the appellant will rely on Kaba v. Cambridge Western Leaseholds Ltd. [1997] B.C.J. No. 2151 (Q.L.) and Jervis Court Development Ltd. v. Ricci [1993] B.C.J. No. 157 (Q.L.). From these decisions, I discern the task of this Court on appeal will be to review the pleadings and the reasons of Justice Melnick to determine whether he made any findings of fact that may embarrass the conduct of the trial of those issues, such that the severance of the entitlement issue was unjust to the appellant. [7] In his counterclaim, the appellant seeks damages from the executors for breach of the oral "meet or beat" agreement he alleges he made with them that he would be given the opportunity "to purchase the Property without payment of realtor's commissions" and "to match or better any offers to purchase the Property received by the Executors." From the plaintiffs and BNS Trustco, he seeks damages for the interference of Sharon Bardsley, as their agent, with his rights under the alleged March 29 and April 2 agreements. As well, he seeks damages from BNS Trustco for its negligence in failing to ensure he was excluded from the obligation to pay realtors' commission. Counsel for all respondents advised they will be bringing Rule 18A applications for dismissal of the counterclaims on June 21, the date set for a hearing by Justice Melnick of their application for special costs. [8] The plaintiffs' application for judgment by way of summary trial was first heard by Justice Melnick on February 14 and 15, 2002. The appellant objected to the matter being heard by summary trial, as he has continually since, and sought an order he be permitted to continue examinations for discovery of the plaintiff Nancy Graham and the plaintiff's agent, Sharon Bardsley. Justice Melnick declined to rule on the appropriateness of a summary trial until he had heard cross-examination on the affidavits. He adjourned the hearing for that purpose. Although he ruled some of the plaintiffs' objections on these examinations were unjustified, he declined to order further discoveries before the summary trial. Leave to appeal that order was refused by Thackray J.A. on April 12, 2002. Both were cross-examined at the trial and both are subject to further discovery before trial of the counterclaim. [9] At a pre-hearing conference on February 28, 2002, the appellant proposed a full trial of all the issues. In that way he could require the attendance of witnesses who refused to cooperate with him: Margaret Hilton, a friend of the Moore family and one of the listing agents, the other listing agent, David Peerless, and Brenda Moore, the sister of the executor, Barrie Moore. In this regard, I note it is not disputed that Ms. Moore was present in Court throughout the hearing. No one sought her testimony. Nor was any of the three the subject of an application for a Rule 28 pre-trial examination or a Rule 52(8) examination at the summary trial. Justice Melnick directed that only the issue of specific performance be tried at the viva voce hearing scheduled for five days beginning April 29, 2002. [10] On 17 April 2002, the appellant sought leave to add a plea for a permanent injunction to restrain the plaintiffs from obtaining transfer of the property as a consequence of their interference with his contractual relations with the executors. Justice Melnick refused the application because of its lateness and the appellant's lack of need for an interim injunction because he had registered a Certificate of Pending Litigation against the property. He did so with leave to apply to amend after the summary trial. This ruling is the subject of the second ground of appeal. [11] In his reasons for judgment, Justice Melnick found Mr. Moore had expressly authorized his co-executor on the morning of March 30 "to accept any counter-offer from the plaintiffs that was over $740,000.00." In reaching that conclusion he had the benefit of hearing from the parties to that conversation, Douglas Derish and Barrie Moore. That finding is consistent with the executors' admission (in para. 3 of their statement of defence) they had entered a contract signed by BNS Trustco on behalf of the estate with the specific authority of Mr. Moore on March 30, 2001. The appellant places great emphasis on a differently worded pleading (at para. 8(t) of the statement of defence), that seems to suggest BNS Trustco had assumed Mr. Moore would agree to accept an offer from the plaintiffs of $752,000.00 because he had earlier authorized acceptance of an offer of $740,000.00. This conflict founds the third ground of appeal. [12] The findings of fact alleged to entrench on the issues to be decided on the trial of the counterclaim are these: (a) [Campa did not] have an agreement with the executors of the Estate to "meet or beat" the offer of any other prospective purchaser. What he had was the connivance of a member or members of the Moore family to feed him inside information. (para. 8) (b) no one referred me to any authority that suggested that the actions [Campa] took were in any way illegal. (para. 9) (c) [Campa was] secure in the knowledge, he thought, that he could always match or better the offer of anyone else, should he choose to do so. (para. 9) (d) The fax correspondence of March 30 reproduced in the reasons for judgment is a valid and binding agreement, (para. 15 and 26) (e) Campa was "always excluded from the listing" for the purposes of realtors' commission. (para. 5) [emphasis added] The appellant considers these findings are dispositive of his claim for damages. However, on May 17, 2002, Justice Melnick issued a Memorandum to Counsel in these terms: As soon as I have time, I will issue a corrigendum to my Reasons for Judgment clarifying that Mr. Campa's Counterclaim is dismissed with respect to his claims against Mr. Moore and BNS Trustco for specific performance of the alleged March 29th agreement or the alleged April 2nd agreement. I did not purport to deal with any other counterclaims of Mr. Campa, including his claim against BNS Trustco and the Plaintiffs for damages for inducing breach of contract, or interference with contractual relations. It may well be that my conclusion in my Reasons for Judgment of May 10, 2002, will have a direct bearing on that claim. However, that is for another day. He then varied his reasons to include these additional words in the last paragraph: His counterclaim is dismissed to the extent that it seeks specific performance of alleged agreements to purchase the property. [13] So, Justice Melnick acknowledged the effect his dismissal of the appellant's claim for specific performance of the alleged March 29 and April 2 agreements had on the counterclaim to title to the property. He did not acknowledge, as the appellant suggests in his submissions, that any findings of fact he made would have a direct bearing on the claim for damages for breach of any "meet or beat" agreement he may have made with the Moores or for the tort of unlawful interference with contractual relations. Rather he determined once and for all that the executors had made a binding contract with the plaintiffs for the transfer of the property, and that the appellant had not. That was the question he had agreed to decide by way of summary trial on the basis of affidavit and oral evidence. [14] The primary question on appeal will therefore be whether any of the trial judge's findings of fact might entrench unfairly on the two questions remaining to be decided. I agree with the appellant those issues are the existence of any "meet or beat" agreement and BNS Trustco's handling of the listing agreement. [15] Neither concerns the plaintiffs. Once it was determined the plaintiffs had an enforceable agreement to convey the property to them and the appellant did not, there was no contract to convey land with which Ms. Bardsley could have interfered. Unless that decision is set aside on appeal the claim for interference with contractual relations must fail and there can be no ground for a permanent injunction preventing the sale of the property to the plaintiffs. Marginally contradictory pleadings are slim ground for an appeal on a question of fact determined after hearing the testimony of the people with the relevant evidence. Included in that evidence was Mr. Moore's testimony that he informed the appellant when he signed the April 2 agreement there was no deal until BNS Trustco signed it. [16] It is not surprising the trial judge's narrative included findings of fact about the alleged agreements. Until final submissions the appellant was relying on the bidding agreement and the meet or beat agreement, as well as the April 2 agreement, to justify his entitlement to a conveyance of title to the property, rather than the opportunity to have an offer considered he now asserts flows from the meet or beat agreement. Thus, the relevant witnesses provided affidavits and were cross-examined about both. Justice Melnick's observation (at para. 22) that "the facts do not support either [the alleged meet or beat agreement or the alleged bidding agreement]" explained the appellant's changed position. He was no longer relying on those agreements to found his entitlement to an order requiring the executors to transfer the property to him upon payment of $720,000.00 (the bidding agreement) or $752,000 less the realtors' commission (the meet or beat agreement), because the evidence did not support the existence of any agreement requiring a conveyance. [17] The trial judge has set June 21, 2002 for hearing the remaining issues. The appeal will not be heard before that date, but may be heard before the date reserved for trial. If the remaining issues are not resolved by way of summary trial, or if the orders of the trial judge are set aside on appeal, they will be resolved at a trial commencing on 3 June 2003. [18] There are two findings of fact that arguably may impinge on the two remaining issues: [5] Although the listing documentation did not immediately reflect it, I am satisfied that, despite some initial reluctance by the listing agent Dexter Properties Inc., Mr. Campa was always regarded as an excluded party for the purpose of paying commission [8] Thus, Mr. Campa was always able to come back with an offer that beat anything any other party, including the plaintiffs, was able to offer. He did not, however, have an agreement with the executors of the Estate to "meet or beat" the offer of any other prospective purchaser. What he had as the connivance of a member of members of the Moore family to feed him inside information, undoubtedly with the object of maximizing the return to the Moore Estate from the sale of the property. [19] In the circumstances of this case, it will be difficult to persuade this court the trial judge acted unjustly in making these findings such that his orders must be set aside to await a full trial of all the issues dividing the parties. The trial judge responded to the delay the appellant's action was causing to the administration of the Moore estate and the accompanying harm to the prospective purchasers inherent in being bound to a contract to purchase by devising a fair method of resolving the dispute as to who was entitled to purchase the Moore property. He facilitated the presentation of all the evidence the parties considered relevant to that issue. If there is additional evidence relevant to the remaining issues, undoubtedly the trial judge will ensure it is received. The Rules provide ample tools for a trial judge to do the right thing bearing in mind their object (set out in Rule 1(2)) is "to secure the just, speedy and inexpensive determination of every proceeding on its merits." [20] When I consider the weakness of the appeal together with the other factors relevant to an application for a stay of execution, I find myself unpersuaded that a stay is warranted in this case. If the appellant can prove actionable negligence on the part of BNS Trustco or some agreement with the executors to consider an offer, he can be compensated in damages for the resulting pecuniary loss. The balance of convenience lies with the plaintiffs and the estate in this case. [21] The application for a stay of execution is dismissed. [22] On the respondents' applications for security for costs, the appellant swore an affidavit that he has available to him his parents' $450,000.00 line of credit and that he owns jointly with his wife a house about two blocks from the Moore property in which they have an equity of at least $1.3 million. He did not provide any evidence of current income or liquid assets. His car is leased. [23] The respondents have incurred costs totaling almost $280,000.00 to date. They anticipate their costs of this appeal will total $90,000.00. While I am of the view the costs of the appeal are exaggerated and can be reduced because their interests on the appeal are the same, these figures show the cost of what is essentially a yearning for a spectacular view on the part of two families. But these figures also illustrate the call on cash and credit resources of all the parties. The appellant's costs are unlikely to be much less than the $100,000.00 the plaintiffs have paid to date. [24] In these circumstances and given the weakness of the appeal, I have decided the appellant should post security for the respondents' costs in the amount of $20,000.00, $10,000.00 for the plaintiffs and $10,000.00 for the executors jointly. I so order. [25] The respondents are entitled to their costs of both applications. "The Honourable Madam Justice Huddart"