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REAL ESTATE Good and bad news A recent appeal court ruling has both pros and cons for those looking to seize property to recoup bad debts. BY KEVIN MARRON that will make it harder to seize property to recoup bad debts. "Anybody who is trying to col- lect debt by selling somebody's real estate could be affected by this," says Richard Hayles, an associate at Toronto-based Heydary Hamilton PC, a litiga- tor with extensive experience in property disputes. The case of Citi Cards T Canada Inc. v. Pleasance pre- sented the Ontario Court of Appeal with what Justice Robert Blair described as "the knotty and interest- ing question" of whether a creditor is entitled to obtain a mortgage statement in order to enforce a judgment that is unrelated to the mortgage. The case involved a cred- it card debt of $11,039.77 for which Citi Cards had obtained a judgment against Charles Pleasance. The cred- it card company wanted to enforce the judgment through a sheriff 's sale of the debtor's Mississauga, Ont., home, which was jointly owned by his wife Bibi. The sheriff, however, would not proceed with a sale without receiving mort- gage discharge statements that would show whether there were other encum- brances on the property. Until now, banks and other finan- cial institutions have been inconsistent here's good news for deadbeat debtors — and bad news for those who lend them money — in a recent court ruling which held the mortgages on the Pleasance property, declined to provide Citi Cards with the discharge statements and the credit card company asked the court to require them to do so. "There have been some dif- fering views and the Toronto- Dominion Bank wanted to get some clarity on this issue," says Richard Horodyski, a senior litigation partner in the Hamilton, Ont., office of Gowling Lafleur Henderson LLP, who represented the bank in this matter. "TD recog- nized the private nature of some of this information and wanted to make sure that personal, private information remained confidential unless there was good and legal cause to have it released." The Court of Appeal agreed with a lower court decision that the banks were correct since the discharge statements contain personal informa- tion as defined by the federal Personal Information Protection and Electronic Documents Act, which prohibits sharing such infor- in deciding whether or not to share mortgage discharge statements with third parties in such circumstances. Some did. Others cited privacy reasons for not doing so. The Canada Trust Co. and the Toronto-Dominion Bank, mation with third parties without con- sent. Citi Cards tried to persuade the court that its situation was covered by an exception whereby the legislation allows disclosure of information if it is required by law or by a court order. But Blair and his fellow judges noted in their January decision that this was a circular argument since Citi Cards was asking the court to make such an order www.CANADIAN Lawyermag.com M A RCH 2011 21 JereMy brUneel