“The court’s discretion to grant leave to issue a CPL is set out in section 103 of the Courts of Justice Act (Ontario) with the procedure in Rule 42. The law with respect to CPL motions brought on on notice in the context of constructive trust claims was recently considered in Saggi v. Grillone, 2020 ONSC 4140; Huntjens v. Obradovic, 2019 ONSC 4343; and Sun Rise Elephant Property Investment Corporation v. Luu, 2018 ONSC 5247. The Defendants rely on all 3 cases.
The factors which the court must consider on a CPL motion were set out by Master Glustein (as he then was) in Perruzza v. Spatone, 2010 ONSC 841 at para. 20:
“(i)The test on a motion for leave to issue a CPL made on notice to the defendants is the same as the test on a motion to discharge a CPL (Homebuilder Inc. v. Man-Sonic Industries Inc., 1987 CarswellOnt 499 (S.C. – Mast.) (“Homebuilder“) at para. 1);
(ii)The threshold in respect of the “interest in land” issue in a motion respecting a CPL (as that factor is set out at section 103(b) of the Courts of Justice Act, R.S.O. 1990, c. C.43) is whether there is a triable issue as to such interest, not whether the plaintiff will likely succeed (1152939 Ontario Ltd. v. 2055835 Ontario Ltd., 2007 CarswellOnt 756 (S.C.J.), as per van Rensburg J., citing Transmaris Farms Ltd. v. Sieber, [1999] O.J. No. 300 (Gen. Div. – Comm. List) at para. 62);
(iii)The onus is on the party opposing the CPL to demonstrate that there is no triable issue in respect to whether the party seeking the CPL has “a reasonable claim to the interest in the land claimed” (G.P.I. Greenfield Pioneer Inc. v. Moore, 2002 CanLII 6832 (ON CA), 2002 CarswellOnt 219 (C.A.) at para. 20);
(iv)Factors the court can consider on a motion to discharge a CPL include (i) whether the plaintiff is a shell corporation, (ii) whether the land is unique, (iii) the intent of the parties in acquiring the land, (iv) whether there is an alternative claim for damages, (v) the ease or difficulty in calculating damages, (vi) whether damages would be a satisfactory remedy, (vii) the presence or absence of a willing purchaser, and (viii) the harm to each party if the CPL is or is not removed with or without security (572383 Ontario Inc. v. Dhunna, 1987 CarswellOnt 551 (S.C. – Mast.) at paras. 10-18); and
(v)The governing test is that the court must exercise its discretion in equity and look at all relevant matters between the parties in determining whether a CPL should be granted or vacated (931473 Ontario Ltd. v. Coldwell Banker Canada Inc., 1991 CarswellOnt 460 (Gen. Div.); Clock Investments Ltd. v. Hardwood Estates Ltd., 1977 CanLII 1414 (ON SC), 1977 CarswellOnt 1026 (Div. Ct.) at para. 9).” (Saggi at para. 29)
The first issue is whether Cindy has advanced claims that raise a triable issue about whether she has a reasonable claim to an interest in the Property sufficient to support the issuance of a CPL (Saggi at paras. 31 and 55). A claim for a constructive trust is a claim for ownership which may give rise to a proprietary interest in land in accordance with s. 103 of the Courts of Justice Act and will support a claim for a CPL (Sun Rise at para. 3; Huntjens at paras. 37-38). Perell J. summarized the availability of a CPL with respect to constructive trust claims in Boal v. International Capital Management Inc., 2018 ONSC 2275:
“65 A constructive trust arising from a breach of fiduciary duty or a constructive trust associated with a claim for unjust enrichment will support a claim for a certificate of pending litigation.
66 A constructive trust is a proprietary remedy that may be available in two general circumstances of restitutionary claims: first, a constructive trust may be available in cases in which the defendant has been unjustly enriched at the expense of the plaintiff; and, second, a constructive trust may be available in circumstances where the defendant has committed a breach of a duty in equity and in good conscience he or she should not keep any ill-gotten gain.”
The evidentiary threshold on a CPL motion is low (Saggi at paras. 45 and 62). It is not the court’s role to determine whether Cindy’s constructive trust claim will likely succeed at trial, but whether she has raised a triable issue or prima facie case that the remedy of constructive trust is available to her or is a possible remedy at trial (Sun Rise at para. 10).
In determining whether there is a triable issue on a CPL motion, the court should not assess credibility or decide disputed issues of fact (Huntjens at paras. 20-21). Rather, the court must examine the whole of the evidence after cross-examination and, without deciding disputed issues of fact and credibility, consider whether on the whole of the evidence the plaintiff’s case constitutes a reasonable claim to the interest in land claimed (Huntjens at para. 21).”