MacAdams v. Grewal

2025 BCSC 414 MacAdams v. Grewal

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: MacAdams v. Grewal, 2025 BCSC 414 Date: 20250312 Docket: S02077 Registry: Abbotsford Between: Douglas Patrick MacAdams, doing business as MacAdams Law Firm Plaintiff And Harbans Singh Grewal and Harminder Singh Grewal Defendants Before: The Honourable Justice Bantourakis Reasons for Judgment The Plaintiff, appearing in person: D. MacAdams, K.C. The Defendants, appearing in person: H.S. Grewal H.S. Grewal Place and Date of Hearing: New Westminster, B.C. February 12, 2025 Place and Date of Judgment: Abbotsford, B.C. March 12, 2025 Table of Contents INTRODUCTION.. 3 BACKGROUND.. 4 The December 19, 2016 Agreement 4 MacAdams' Legal Fees. 5 The Baring Action. 5 Subsequent proceedings including the Fraudulent Conveyance Actions. 6 ANALYSIS. 7 Is there a genuine issue as to whether this action is time-barred?. 8 Is the claim bound to fail because it is res judicata?. 12 CONCLUSION.. 14

INTRODUCTION [1] This action is but one of several offshoots of broader litigation going back well over a decade initially involving three brothers, two of whom, Harbans Singh Grewal and Harminder Singh Grewal, are the defendants in this action. I will refer to them by their first names to avoid confusion. [2] The brothers were once adverse in interest and much of the earlier litigation I have alluded to saw them pitted against each other. However, that was some time ago and it seems that they have since resolved their differences. Among other things, in December 2016, Harminder and Harbans entered into an agreement settling all of Harminder's costs claims against Harbans for $190,000 [the "December 19, 2016 Agreement"]. [3] The plaintiff, Mr. MacAdams, whom I will refer to simply as MacAdams, was previously Harminder's lawyer. Harminder owes MacAdams money for unpaid legal fees. In this action, MacAdams alleges that the December 19, 2016 Agreement is fraudulent within the meaning of the Fraudulent Conveyance Act, R.S.B.C. 1996, c. 163 and is void pursuant to s. 79(6) of the Legal Profession Act, S.B.C. 1998, c. 9 ["LPA"]. He wants moneys Harminder relinquished his claims to when he entered into the December 19, 2016 Agreement to be available to Harminder's creditors including, of course, MacAdams himself. [4] Harbans has applied for summary judgment arguing that this action was commenced outside of the applicable limitation period and that the validity of the December 19, 2016 Agreement is res judicata. Harminder consents to the relief sought by his brother. [5] The question on this summary judgment application is whether MacAdams' claim is bound to fail for one or more of the reasons outlined by Harbans or whether, instead, there is a genuine issue for trial.

BACKGROUND The December 19, 2016 Agreement [6] In 2003, Harbans, Harminder and their other brother Zora jointly purchased a 60-acre berry farm in Langley B.C. Over the years, there were legal proceedings between them concerning the ownership of and financial matters related to the farm, a summary of which is set out in Grewal v. Grewal, 2016 BCCA 237 at paras. 15-67. [7] It is not necessary to detail all the related litigation, which has been protracted, complex and very costly. For current purposes, what matters in a general sense is that Harminder obtained several costs orders against Harbans, including for special costs. Additionally, Harbans was at a certain point required to provide security for Harminder and Zora's costs. Underlying the order for security were judicial findings on Harbans' conduct in the litigation and that Harbans was unlikely to pay voluntarily once costs were awarded and assessed: see e.g. Grewal v. Grewal, 2020 BCSC 435 at para. 18. [8] Specifically, $340,000 was held as security for Harminder's costs claims against Harbans. Harminder initially claimed more than that ($525,000) in special costs from Harbans, but those costs were never taxed: Grewal v. Grewal, 2020 BCSC 435 at paras. 17, 19. [9] Instead, by way of the December 19, 2016 Agreement, and without the assistance of counsel, Harminder settled all of his costs claims against Harbans for

$190,000. Thus, of the $340,000 held as security for Harminder's costs, $190,000 was to go to Harminder and $150,000 returned to Harbans with no additional amounts owing. A taxation of outstanding costs in Harminder's favour that had been scheduled for the summer of 2017 was rendered moot and did not proceed. [10] The brothers later obtained a consent order without notice for payment out of the security in accordance with their agreement. However, that order was later set aside on the basis that the brothers had failed to disclose material facts in obtaining it, notably in that there were others who might have a claim to those moneys: Grewal v. Grewal, 2017 BCSC 1004 ["Grewal 2017"]. The Grewal 2017 decision was made on February 28, 2017 and MacAdams appeared on the underlying application. Harbans says this is the latest date by which MacAdams knew of the December 19, 2016 Agreement. MacAdams' Legal Fees [11] Also around December of 2016, MacAdams, who had been Harminder's lawyer from 2007 to 2016 and had represented him throughout most if not all the litigation between the brothers, ceased acting for Harminder. He then began taking steps to render a final invoice and collect his unpaid accounts. This led to proceedings under the LPA. [12] MacAdams and Harminder later settled the issue, agreeing that the amount Harminder owed MacAdams was $650,000. On February 4, 2019, and on

consent, they filed a Registrar's Certificate of Fees in that amount [the "Consent Certificate of Fees"]. [13] As I will explain, MacAdams says that at this point, on February 4, 2019, there were several avenues by which he understood he would be able to satisfy the Consent Certificate of Fees. Harminder had more than $850,000 held either in Court or in the MacAdams firm trust account. In addition to those funds, assuming the December 19, 2016 Agreement was valid, Harminder had an entitlement to an additional $190,000 which was still being held as security for his costs. The Baring Action [14] Just a few months later, however, on November 15, 2019, a substantial judgment was rendered against Harminder, changing his financial picture: Baring v. Farm Credit Corporation, 2019 BCSC 1965. [15] To summarize in the briefest of terms, in the Baring action, Harminder and Zora were found to have sprayed the berry farm with herbicides, effectively killing off that year's crop and damaging the blueberry plants. They did so after the berry farm was sold in the context of foreclosure proceedings. Harminder was found liable to the purchasers of the berry farm (the Barings) in an amount close to three million dollars. At the trial level, the judge found the Barings were entitled to an abatement of the purchase price for the farm. On appeal, the abatement order was set aside, but Harminder

remained liable to the Barings for $2,796,400 in damages and a further $150,000 in punitive damages: Baring v. Grewal, 2022 BCCA 42. Subsequent proceedings including the Fraudulent Conveyance Actions [16] I set out here some of the proceedings post-dating judgment in the Baring action. This summary is not meant to be comprehensive. I have simply set out those aspects of the litigation history that are most important for the purposes of deciding the application before me. [17] I begin with Grewal v. Grewal, 2020 BCSC 435, which I am referring to as the "2020 Payment-Out Decision". In early 2020, Singleton Urquhart Reynolds Vogel LLP ("Singleton") applied for an order that certain funds held collectively in the MacAdams firm trust account and in Singleton's trust account be paid out. Singleton had acted for Harbans and was seeking payment out of approximately $150,000 and interest to satisfy fees owing to it by Harbans. [18] The December 19, 2016 Agreement was discussed in the 2020 Payment-Out Decision because, as explained above, it allocated to Harbans $150,000 of the security that had been ordered for Harminder's costs. In the course of a broader discussion allowing Singleton's application, the Court noted that MacAdams had been aware of the December 19, 2016 Agreement for three years by that point and had not taken any steps to set it aside: 2020 Payment-Out Decision at

paras. 25, 26, 76. This was to be contrasted with the lawyers for Zora, who had taken steps to set aside a similar costs settlement Harbans and Zora had entered into: 2020 Payment-Out Decision at paras. 42, 47, 60-62. [19] In the result, the Court allowed Singleton's application ordering the release to Singleton of $150,000 from the funds that had initially been held as security for Harminder's costs against Harbans, but that he had relinquished any claim to in the December 19, 2016 Agreement. [20] About two years later, in early 2022, MacAdams filed two Notices of Civil Claim alleging that Harminder and others had made fraudulent conveyances. The first claim, filed on February 17, 2022, alleged that transfers of property by Harminder and his spouse to their daughter in 2012 and 2020 were fraudulent conveyances. The second, filed on March 11, 2022, is the one before me on the instant application, in which MacAdams takes aim at the December 19, 2016 Agreement on similar bases. [21] MacAdams' claim in respect of the 2012 property transfer has since been summarily dismissed as time-barred: MacAdams v. Grewal, 2023 BCSC 874. I will refer to this as the "2023 Limitation Decision". The Court found that the limitation period on MacAdams' claim that Harminder had fraudulently conveyed property in 2012 had begun to run on February 4, 2019, the date the Consent Certificate of Fees was

entered, which formalized the amount owed by Harminder to MacAdams. [22] Harbans says, among other things, that similar reasoning applies here. On June 4, 2024, he filed his Notice of Application seeking summary dismissal of MacAdams' claims in this action. If Harbans does not succeed, the trial of this matter is currently set on the June 2, 2025 assize, for five days. [23] To conclude with this abbreviated overview of the history leading to this point, I will note generally that there have been other proceedings, including a petition in which MacAdams obtained an order for payment of outstanding fees from the moneys held in his own trust account, though he did not succeed in obtaining other relief he had sought on that petition: MacAdams v. Grewal, 2023 BCSC 2121. There was also a recent order, on January 31, 2025, by which certain moneys held in court were paid out on agreement between MacAdams and the Barings. The end result is that to date MacAdams has collected about half of what he is due under the Consent Certificate of Fees.

ANALYSIS [24] This matter comes before me on a summary judgment application. Summary judgment as provided for in Rule 9-6 serves an important purpose, permitting as it does for claims or defences that have no chance of success to be dismissed at an early stage and without the need for a full trial. However, because it is equally important that claims that disclose real issues be tried, the bar for summary judgment is high: McLean v. Law Society of British Columbia, 2016 BCCA 368, at para. 36, citing Canada v. Lameman, 2008 SCC 14 at paras. 10-11. [25] The party seeking summary judgment bears the evidentiary burden of showing that there is no genuine issue for trial in the sense that the claim is bound to fail. The lack of a genuine issue for trial must be manifestly clear. The onus of establishing this is on the applicant: Beach Estate v. Beach, 2019 BCCA 277 at para.

65. The challenge proceeds on a limited review of evidence. If there are disputed facts, the Court must not weigh the evidence, nor choose between conflicting versions of events: Beach at paras. 48-49; Sakwi Creek Hydro Limited Partnership v. Dickin, 2023 BCCA 188 at para. 25; Lyons v. Canadian Imperial Bank of Commerce, 2025 BCCA 22 at para.

2. Inferences from the facts must be viewed in a light most favourable to the plaintiffs: Foote v. Canada (Attorney General), 2012 BCSC 177 at paras. 25, aff'd 2013 BCCA 135. [26] Harbans says there is no genuine issue for trial for two reasons. First, he says that this action was commenced outside the applicable limitation period. Second, he says the validity of the December 19, 2016 Agreement is res judicata. I consider each of these submissions in turn. Is there a genuine issue as to whether this action is time-barred? [27] Harbans says that there is no genuine issue for trial because this action is time-barred. The applicable limitation period is two years from the date of discovery: Limitation Act, S.B.C. 2012, c. 13, s. 6(1). To the extent that the limitation period may have run past March 25, 2020, the two-year period was extended by one year: COVID-19 Related Measures Act, S.B.C. 2020, c. 8 (Item 27 of Schedule 2); Nguyen v. Canam Active Enterprises Inc., 2022 BCCA 174 at paras. 8-10. [28] In this instance, pursuant to s. 8 of the Limitation Act, the date of discovery is the first day on which MacAdams knew or reasonably ought to have known all of the following: (a) that injury, loss or damage had occurred; (b) that the injury, loss or damage was caused by or contributed to by an act or omission; (c) that the act or omission was that of the person against whom the claim

is or may be made; (d) that, having regard to the nature of the injury, loss or damage, a court proceeding would be an appropriate means to seek to remedy the injury, loss or damage. [29] Harbans' primary position is that the limitation period began running as of the Grewal 2017 decision I referred to earlier, which is the latest time by which MacAdams would have known of the December 19, 2016 Agreement. However, Harbans also acknowledges jurisprudence holding that the limitation period on Fraudulent Conveyance Act claims may not run until the plaintiff has become the transferor's judgment creditor: see e.g. Watts v. Klaemt, 2010 BCSC 1122; Prima Technology v. Yang, 2018 BCSC 94; Jasmur Holdings Ltd. v. Callaghan, 2019 BCSC 1966; Mori v. Lobb, 2021 BCSC 2266 at paras. 21-27. [30] Here, the Consent Certificate of Fees was entered on February 4, 2019. In light of the above jurisprudence and the evidence on this application, I cannot say that MacAdams' claim is bound to fail based on a February 28, 2017 discovery date. That is, in light of the evidence before me and the legal principles set out in Watts and its progeny, there is a genuine issue as to whether the limitation period began on February 28, 2017 or some later time. [31] Harbans says, however, that even if the limitation period runs as of February 4, 2019, when the Consent Certificate of Fees was entered, as was found to

be the case in the 2023 Limitation Decision vis-à-vis Harminder's 2012 property transfer, this does not assist MacAdams, because this action was commenced more than three years after that date. [32] MacAdams makes several arguments in response, the gist of which is either (1) that there is no limitation period at all because this proceeding falls within the terms of s. 2(d) of the Limitation Act or (2) that the limitation period ran only as of the trial decision in the Baring action (November 15, 2019) having regard to either ss. 8(a) or (d) of the Limitation Act. On the latter front, if the limitation period started to run on November 15, 2019, this action was commenced in time, by combined operation of the two-year limitation in s. 6 of the Limitation Act and the one-year pandemic-related suspension I referred to earlier. [33] MacAdams acknowledges that his submission that no limitation period applies may be tenuous in light of the principles discussed in Bank of Montreal v. Iskenderov, 2023 ONCA 528 at paras. 57-66, albeit in the context of Ontario legislation. I would add that MacAdams has offered no jurisprudence supportive of his s. 2(d) Limitation Act submission. As mentioned above, there are several cases that discuss when time begins to run for actions alleging fraudulent conveyances and which proceed on the premise that such claims are subject to the relevant

statutory limitation period. In any event, because of the conclusions I have reached on discoverability, there is no need to address this issue further. [34] In terms of discoverability, MacAdams says that his claim was discoverable only as of the date of the Baring decision on November 15, 2019. He submits that, before then, Harminder had in excess of the amount he owed MacAdams sitting either in court or in lawyers' trust accounts. MacAdams says that it was only on November 15, 2019, when Harminder was found liable to the Barings for an amount close to three million dollars, that MacAdams knew or reasonably ought to have known that: a. he had suffered injury, loss or damage within the terms of s. 8(a) of the Limitation Act because at that point the moneys that had been available to him were no longer available to him in the same way given competing claims to those funds as between him and the Barings; or b. that a court proceeding would be an appropriate means to seek to remedy the injury, loss or damage he had suffered, as contemplated in s. 8(d) of the Limitation Act, because before then there were ample funds available to satisfy the Consent Certificate of Fees and so starting an action challenging the validity of the December 19, 2016 Agreement in order to free up further funds would not have been reasonable or appropriate. [35] As for the 2023 Limitation Decision,

MacAdams says the impact of the Baring Decision on discoverability was not in issue there, as the dispute centered around whether the limitation period on the 2012 property transfer started running on February 4, 2019, the date the Consent Certificate of Fees was entered, or on February 18, 2019, the date upon which the Consent Certificate of Fees became a judgment of the Court pursuant to ss. 75 and 76(3) of the LPA. This made all the difference in that case, because MacAdams' claim there had been filed on February 17, 2022, more than three years after the earlier of those dates, but less than three years after the later of them. [36] An action that is clearly statute-barred because of the expiry of a limitation period can be dismissed on summary judgment. However, caution is required in making that determination. Assessing a limitations defence is an inherently factual exercise that usually requires a developed evidentiary record. Discoverability is not a straightforward matter; the plaintiff's personal circumstances and understanding will often be implicated. Accordingly, limitation issues are generally not readily determined on summary judgment and in many instances should be left to be addressed at trial on a full record: Rooney v. Galloway, 2024 BCCA 8 at paras. 164-165, 167. The 2023 Limitation Decision did not engage those concerns because the limitation issue there

turned on the narrow question of whether time ran from when Harminder and MacAdams had reached agreement on the amount owing, or a few days later when their agreement became a judgment by operation of law. [37] Conversely, the above cautions do resonate here. MacAdams' position raises factual issues, at least insofar as s. 8(d) of the Limitation Act is concerned. This became obvious during the hearing of this application when, for example, queries as to the Baring decision's impact on discoverability devolved into submissions on MacAdams' pre-decision knowledge and understanding of the scope and strength of the Barings' claim. Also in issue on the evidentiary record before me is the degree to which moneys being held in court or in lawyers' trust accounts were, as a matter fact, reasonably available to MacAdams in satisfaction of the Consent Certificate of Fees before the Baring decision and the relative impact of those facts, if any, on discoverability. [38] Nothing I have said here should be taken as expressing a view on the strength of MacAdams' discoverability arguments at the end of the day. Simply put, in order to decide that, at least insofar as s. 8(d) of the Limitation Act is concerned, I would have to weigh the evidence and make findings on disputed facts in a manner not permitted on a summary judgment application. Accordingly, there is a genuine issue for trial on

whether this action is time-barred. Is the claim bound to fail because it is res judicata? [39] In his notice of application for summary judgment, Harbans also seeks dismissal of this action on the basis that the validity of the December 19, 2016 Agreement, which MacAdams impugns in this action, was already upheld in the 2020 Payment-Out Decision and is therefore res judicata. As explained in Innes v. Bui, 2010 BCCA 322 at para. 19: [19] There are two forms of the doctrine of res judicata: cause of action estoppel and issue estoppel. Both operate where the court has adjudicated a cause of action between two or more parties and one of them seeks to re-litigate on the same facts. Where the cause of action is the same, cause of action estoppel operates to prevent re-litigation of any matter that was raised or should have been raised in the prior proceeding. Where the cause of action in the two proceedings is different, issue estoppel operates to prevent re-litigation of any issue determined in the prior proceeding. [40] Here we are dealing with an alleged issue estoppel. Cause of action estoppel does not apply because MacAdams' claim that the December 19, 2016 Agreement was fraudulently entered into arises from a different factual situation than Singleton's earlier application for the disbursement of funds owed to it by Harbans: see e.g. Cliffs Over Maple Bay (Re), 2011 BCCA 180

at para. 28. [41] The pre-conditions to making out issue estoppel are (1) that the same question has been decided; (2) that the judicial decision which is said to create the estoppel was final; and (3) that the parties to the judicial decision or their privies were the same parties to the proceedings in which the estoppel is raised or their privies: Angle v. M.N.R., [1975] 2 S.C.R. 248 at 254. The first requirement will be met not only where the same question has expressly been decided, but also where the question is "necessarily bound up with" an issue decided in the prior proceeding": Cliffs Over Maple Bay (Re), at paras. 32, 36; see also: Liu v. Borden Ladner Gervais LLP, 2020 BCCA 50 at paras. 36-37. [42] I am not satisfied the 2020 Payment-Out Decision decided the December 19, 2016 Agreement's validity or that that decision's outcome was necessarily bound up with the agreement's validity. The decision does refer more than once to the fact that MacAdams had not applied to set aside the December 19, 2016 Agreement: 2020 Payment-Out Decision at paras. 23, 25, 76. However, it goes no further than that. [43] Zora's counsel had applied to set aside the validity of a similar agreement entered into between Harbans and Zora and opposed the payment out just as MacAdams did: 2020 Payment-Out Decision at paras. 42-62. The Court recognized that the validity of that particular agreement

was in dispute, but still approved the payment out on a relative weighing of the prejudice, on the one hand, to Singleton in dismissing its application for payment out of fees owed to it and, on the other, to Harbans' creditors and potential future creditors (including Zora's counsel) in allowing it: 2020 Payment-Out Decision at paras. 66-77. [44] Insofar as the December 19, 2016 Agreement is concerned, the 2020 Payment-Out Decision simply makes clear that any prejudice to MacAdams was theoretical at that point in time and would not be weighed in the balance (unlike the potential prejudice to Zora's counsel, which was weighed in the balance) because the Court was not willing to treat MacAdams as a potential creditor of Harbans without proceedings having been instituted in that regard. In my view, this does not equate to a finding, whether expressly or by necessary implication, that the December 19, 2016 Agreement was valid. Accordingly, the doctrine of res judicata does not apply regarding the validity of that agreement. [45] There remains an outstanding issue regarding res judicata. That is whether the limitation date for this claim impugning the December 19, 2016 Agreement is res judicata because of the 2023 Limitation Decision. Harbans alluded to this at the hearing, but did not raise it in his notice of application. As a consequence, MacAdams' response does not address it either. Nor is it an issue MacAdams could reasonably have anticipated at that point, considering Harbans' primary position on the limitation issue was that the limitation period ran from the Grewal 2017 decision (which could not have been the case if the running of time from February 4, 2019 was res judicata). Accordingly, this will be an issue for the trial judge to decide.

CONCLUSION [46] Harbans' summary judgment application is dismissed. Costs of this application are in the cause. "Bantourakis, J."