310 Preservation Of Applications

CASE LAW

The registrar refused to register a certificate of pending litigation on the appellant’s former matrimonial home. Title to the property was transferred to third party purchasers by way of a vesting order before the appellant’s attempt to register the CPL. On the date of the attempt to register the CPL, the appellant was not a party to the family law proceeding and he had not filed an application to stay the vesting order. From the pronouncement of the vesting order, the appellant had no interest in the home. In the present application, the appellant appealed from the Supreme Court’s dismissal of his appeal from the registrar’s refusal to register the CPL. In upholding the decision of the Supreme Court, the Court of Appeal found that the balance of inconvenience did not favour any form of injunctive relief in relation to the home and that the application was not one of those rare cases where the court should exercise its discretion to order an injunction or to stay the earlier orders of the Supreme Court (Berthin v. British Columbia (Registrar of Land Titles), 2016 BCCA 255 (Chambers)).

In related proceedings, the appellant applied to have the vesting order set aside because the trial judgment ordering the sale of the property was overturned on appeal and the underlying family claim was sent back to the Supreme Court for a new trial. The Court of Appeal held that the third party purchasers were not parties to the underlying family litigation and that they were entitled to rely on the court orders approving the sale and vesting title in them. Although the third party purchasers were aware the appellant had opposed the sale at one point, they also knew the appellant had applied to court to stop the sale and had not succeeded. As vesting had already taken place, the court held that it was now too late for the vesting order to be undone (Berthin v. Berthin, 2016 BCCA 425, leave to appeal refused 2017 CanLII 12226 (SCC)).

The husband then brought a separate action against his wife and the third party purchasers, seeking to set aside the registration of the vesting order and to restore title in the property to him and his wife, subject to his claims in the ongoing family law proceedings. As part of his claim he alleged fraud. The third party purchasers applied to dismiss the claims as frivolous or vexatious. The trial judge allowed that application and made an order cancelling a certificate of pending litigation filed against the property by the husband. The husband’s appeal was allowed in part. The Court of Appeal ruled that the judge erred in dismissing the fraud claim on the basis that it disclosed no reasonable cause of action. In addition, the judge erred in concluding he had inherent jurisdiction to cancel the certificate of pending litigation because he had dismissed the claims on which the interest in property were based. A certificate of pending litigation is an extraordinary prejudgment mechanism intended to protect a valid claim to an interest in land until the issues in dispute can be resolved. It prevents a plaintiff’s claim from being defeated by the defendant transferring the property in dispute to a third party. Section 254 of the Act continues that protection throughout the appeal process. A judge has jurisdiction to make an order immediately cancelling a certificate of pending litigation when the claim does not meet the threshold requirements of s. 215, or when the property owner affected by the certificate of pending litigation establishes hardship or inconvenience under s. 256. A judge does not have jurisdiction to make an order cancelling a certificate of pending litigation when a claim is dismissed under Supreme Court Civil Rule 9-5, Rule 9-6, or 9-7, or following a full trial. In those circumstances, s. 254 governs and an order purporting to immediately cancel a certificate of pending litigation cannot be given effect and should not be made (Berthin v. Berthin, 2018 BCCA 57).