J. Q.B.G. A.D. 1995 No. 3050 J.C. R. IN THE QUEEN'S BENCH JUDICIAL CENTRE OF REGINA BETWEEN: THE OWNERS: CONDOMINIUM PLAN 84R16835 and JEFFREY JAMES SOUTH, KAREN JOAN RILKOFF, WESTERN LITHO LIMITED, GORDON JAMES KEIR NEILL, THE ROYAL BANK OF CANADA, HELEN RILKOFF, KEVIN JACQUES, and BALFOUR MOSS and JEFFREY JAMES SOUTH and KAREN JOAN RILKOFF PLAINTIFFS BY COUNTERCLAIM and THE OWNERS: CONDOMINIUM PLAN 84R16835 DEFENDANT BY COUNTERCLAIM P.J.D. Tyerman for The Owners: Condominium Plan 84R16835 D.D. Kowalishen for Jeffrey James South and Karen Joan Rilkoff FIAT MATHESON J. September 22, 1997 The plaintiffs have applied for an order, pursuant toQueen's Bench Rule 173, striking out the statement of defenceand counterclaim of Jeffrey James South and Karen Joan Rilkoff(the defendants) and the separate statement of defence ofHelen Rilkoff. It has been asserted that the issues raised in thedefendants statement of defence, and in the statement ofdefence of Helen Rilkoff, do not disclose a reasonabledefence, nor do the issues in the counterclaim show areasonable cause of action. The plaintiffs have also alleged that paragraphs 6, and of the defendants statement of defence, which are incorporated into paragraph 10 of the counterclaim, raise issues which have been dealt with in final decision of court of competent jurisdiction and the defendants are therefore barred by the doctrine of res judicata, or issue estoppel, from pursuing such issues. Consequently, it has been asserted that the raising of such issues is an abuse of the process of the court. Finally, it has been submitted that the defendants statement of defence and counterclaim are frivolous, vexatious and otherwise an abuse of the process of the court. CLAIMS The plaintiffs claim against the defendants as owners of condominium unit number 14. The plaintiffs claim that the defendants have not paid, since 1994, their share of assessments against all unit owners. It is alleged that the plaintiffs claim forms charge against the defendants condominium unit which is analogous to municipal tax lien and can therefore be enforced against, and survives the enforcement by, prior encumbrances. It has been further alleged that the plaintiffs' claim can be enforced in the same manner as mortgage charge. Consequently, the principal claim against the defendants is for an order foreclosing their equity of redemption in their condominium unit. No claim has been asserted against Helen Rilkoff. She has been added as defendant on the basis that she has registered mortgage against condominium unit number 14. It has been alleged that because the plaintiffs' charge against condominium unit number 14 takes priority to all encumbrances, Helen Rilkoff appears to have an interest in the equity redemption. The amount claimed to be owing by the defendants, as of June 1, 1997, is $29,598.19, calculated as follows: Arrears of assessment 7,665.21 Interest on arrears 5,860.67 Solicitor/client costs 16,072.31 Total $29,598.19 DEFENCES The defendants have admitted that they have not paid assessments since 1994 but assert that they are entitled to set off against the assessments damages incurred to their condominium unit as result of the plaintiffs failing to have maintained the common property immediately adjacent to their condominium unit. The defendants have also counterclaimed for those damages. It has also been asserted that the resolutions, pursuant to which the plaintiffs made the assessments, were enacted under the authority of The Condominium Property Act, R.S.S. 1978, c. C-26 but that none of the resolutions make provision for charging interest or solicitor/client costs. It has further been alleged that the bylaws enabling the plaintiffs to claim interest and solicitor/client costs are ultra vires the powers granted to the plaintiffs by the foregoing statute. The defendants have also asserted that the right of the plaintiffs to claim lien against the condominium unit arose only by virtue of The Condominium Property Act, 1993, S.S. 1993, c. C-26.1, which did not come into force until January 1, 1995. Helen Rilkoff has alleged that her mortgage charge was registered prior in time to the lien claimed by the plaintiffs in their caveat and should therefore not be affected by the claim. If the plaintiffs' lien does take priority, however, it has been alleged that it can only do so with respect to unpaid assessments arising after January 1, 1995. SUBMISSIONS The plaintiffs have argued that the doctrine of resjudicata applies to the defendants claim for damages by virtueof two Small Claims court judgments in 1989 and 1992. Thedefendants have asserted that their damages arose in 1994 andthat the cause thereof was a different cause than those causesdealt with in the 1989 and 1992 judgments. The defendants have referred to judgment of this Court in support of their allegation that if the resolutions authorizing the assessments do not also contain resolutions authorizing the plaintiffs to recover interest and solicitor/client costs, the plaintiffs are not entitled to do so. The plaintiffs, on the other hand, have insisted that the judicial decision referred to is erroneous. The plaintiffs have submitted that no right of set off for damages exists with respect to the claim for arrears of mortgage loan. Both parties have referred to statutory provisions, and judicial decisions, in support of their respective positions as to the validity of the bylaws of the plaintiffs allegedly entitling the plaintiffs to claim interest on unpaid assessments and solicitor/client costs. The plaintiffs filed a 55 page brief in support oftheir submissions, and the defendants filed a 14 page brief inresponse thereto, evidencing, to some extent, the fact thatthe issues raised do not appear susceptible of being simplyresolved, and certainly not on a summary basis. CONCLUSION When plaintiff applies for an order striking out statement of defence, and counterclaim, on the basis that no justiciable issue is raised in the defence, or any reasonable cause of action in the counterclaim, or that the pleadings are frivolous, vexatious, and an abuse of the process of the court, the court is not permitted to embark upon the resolution of legal questions in order to determine whether the pleadings should be struck as requested. If no facts are in dispute, the parties may resort to Queen's Bench Rule 188, which permits resolution of questions of law prior to trial if the resolution thereof will resolve the dispute between the parties or significant aspects of the dispute. Counsel for the plaintiffs proposed that the court convert the plaintiffs' application, as matter of convenience, into Queen's Bench Rule 188 application. However, it was pointed out that the preconditions for hearing applications pursuant to Queen's Bench Rule 188 are quite different to those relating to Rule 173, in that an application to strike out pleadings basically permits only an examination of the impugned pleadings to determine if any justiciable dispute is revealed. Only if the defendants consented to the application being converted into an application pursuant to Queen's Bench Rule 188 could the court proceed to resolve what appeared to be rather serious questions of law. The consent by the defendants to do so was not forthcoming. The application of the plaintiffs must therefore bedismissed with costs to the defendants in any event of thecause.
FIAT. The plaintiffs applied for an order striking out the statement of defence and counterclaim and separate statement of Helen Rilkoff as not disclosing a reasonable defence or cause of action. The plaintiffs claimed the doctrine of res judicata applied to the claim for damages by virtue of two Small Claims court judgments in 1989 and 1992. The defendants asserted their damages arose in 1994 and that the cause thereof was different than those previously dealt with. HELD: The application was dismissed with costs to the defendants in any event of the cause. 1)The fact that the plaintiffs filed a 55 page brief in support of their submissions and the defendants filed a 14 page brief in response evidenced that the issues were not easily resolved and certainly not on a summary basis.  2)An application to strike out pleadings basically permits only an examination of the impugned pleadings to determine if any justifiable dispute is revealed. If no facts are in dispute, the parties may resort to Rule 188. Only if the defendants consented to the application being converted into an application pursuant to Queen's Bench Rule 188 could the court proceed to resolve the questions of law.