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www.lawtimesnews.com Page 2 January 28, 2008 / Law Times NEWS party responsible for the fraud (the 'intermediate owner') is vulnerable to a claim from the true owner because the inter- mediate owner had the oppor- tunity to avoid the fraud. How- ever, any subsequent purchaser or encumbrancer (the 'deferred owner') has no such opportu- nity. Therefore . . . the deferred owner acquires an interest in the property that is good as against all the world." HSBC argued that Meleknia was an intermediate owner, and therefore a deferred owner, mak- ing the bank's charge against him indefeasible, based on the Law- rence ruling. However, in inter- preting Lawrence, Macdonald found that, "Within the broader notion of transactional proximi- ties to the fraudster is the more specific, determinative factor, the opportunity to avoid the fraud." In his concluding remarks in the decision, released on Dec. 19, Macdonald says, "Casting the test of opportunity to avoid the fraud may appear to move it closer to a fault test. However, in Lawrence, allegations that the chargee, Maple Trust Co., failed to exercise due diligence were abandoned . . . The Court of Appeal held that Maple Trust Co. had an opportunity to avoid the fraud even though there was no lack of due diligence on its part. Legal fault concepts were not part of the ratio in Lawrence. Yet, one of the principles on which the decision was based was encourag- ing lenders to be vigilant when making mortgages." He later writes, "The bank had the opportunity to avoid the fraud . . . It dealt with the fraud- ster and, whether through its solicitor or otherwise, it did not take steps to scrutinize the power of attorney. The bank chose to put itself in proximity to the un- known fraudster in this transac- tion by dealing with him, yet it failed to make use of the oppor- tunity to avoid the fraud, which that proximity gave it." The judge declared the bank's charge invalid and awarded Rev- iczky costs against the bank on a partial indemnity basis. Gavin Tighe, who represented Caplan as an intervener in the case, says Reviczky "has highlight- ed powers of attorney as a pretty significant document in some real estate transactions. "Number two, I think it's a pretty significant case in terms of dealing with the application of the Lawrence decision, from a convey- ancing perspective, in whether or not a purchase money mortgage situation is different than a con- veyance down the road, in terms of being an immediate owner or intermediate owner or deferred owner or what have you." Aaron says he hopes, in light of the ruling and facts surround- ing Reviczky, that the standard- form real estate agreements will be amended to consider how powers of attorney will be treated in the future. He also notes that the Ministry of Government and Consumer Services will soon in- troduce a new requirement for so- licitors using a power of attorney to certify its validity. Aaron, who says the change would require lawyers to sign a "document of law" declaring the power of attor- ney valid, expects it to take hold by the end of March. "That's going to be very dif- ficult for some lawyers," says Aar- on. "If, for example, the power of attorney was signed years ago and the person is mentally incompe- tent, it may be very difficult for the lawyer to satisfy himself or herself that it's still valid." While the decision may lead to greater speculation of powers of attorney, Aaron agrees with Macdonald's ruling. "I think it was a good deci- sion, and I think people are now going to be even more careful about dealing with powers of at- torney and identity fraud." Reviczky's lawyer, Tonu Toome, says he's yet to prepare a bill of costs in the case and notes that the order still must be final- ized. He says Reviczky lost about $13,000 in rental fees through the ordeal. He says his client continues to seek damages and that, "My next target is really the Land Titles Assurance Fund." Toome says that, on a per- sonal level, it was satisfying to see a positive outcome for Reviczky, who uses income from the invest- ment property to help relatives in his native Hungary. "I was happy about this re- sult," says Toome. "I think Jus- tice Macdonald came up with a well-reasoned decision . . . It just gets rid of another hurdle for my client, and now the hurdle's not as large as it would have been had the mortgage been found valid." (2-5 years with strong court experience) for busy, salaried, associate position at established Richmond Hill general practice law fi rm. peong@hotmail.com Forward your resume/references/transcripts in confi dence by email to ASSOCIATE LITIGATION LAWYER REQUIRED SERVICES - Available law clerk. Proficient in estates, real estate, liti- gation, ADR, corporate/commercial and labour and employment. Part/full time. Messages (416) 621-2485. EMPLOYMENT WANTED Marketplace To advertise call 905-841-6481 jobsinlaw.ca jobsinlaw.ca Continued from page 1 LT A total of 606 of the country's superior court judges are currently sitting in all provinces and territories, in- cluding chief justices and associate chief justices, with a further 59 family division judges, 30 of them in On- tario. There are 19 superior court vacancies nationally. Ontario Superior Court now has 197 judges, aside from the family court justices, with a further seven vacancies. Ontario Attorney General Chris Bentley wrote Nicholson last December urging him to amend bill C-31 to expand the number of family court judges for the province in addition to the other appointments contemplated by the legislation, says Brendan Crawley, Bentley's communications director. The province had urged the previous Liberal gov- ernment in 2004 to add 12 judges for the family court component of Ontario Superior Court, Crawley said in an e-mail response to questions. Although Ottawa's criminal and civil cases are also straining superior court, Murray said the court's family bench is struggling because it has only four judges to cope with mounting cases and pressure. The demand on the family court judges is made worse by the high number of cases involving people who represent themselves because they can't afford law- yers, says Murray. Judges must guide clients through their cases. As well, the level of conflict in family court is intrinsically "very high." Because of the stress and demand, superior court judges are rotated in and out of the family court, says Murray. A County of Carleton Law Association study found Ottawa has up to 30 per cent fewer fam- ily court judges per capita compared to London, Ont. and Windsor. "To do an exclusively family court diet would be pretty taxing for the judges," she says, adding that the appointment of full-time judges with family law exper- tise would ease the burden. Murray blames the high number of clients who rep- resent themselves on Ontario's flagging legal-aid pro- gram, which she says is "grossly underfunded." "Trials that are supposed to be taking place in a very timely way because the issues affect young children are delayed and are taking much longer to be heard because we don't have enough judges," she said. The Ottawa criminal bench is also currently under pressure because of an "inordinately large" number of cases for which the Ontario Court of Appeal has or- dered new trials, says Ertel. He adds more murder cases are "in the queue then they ever had before." Tom Conway, past president of the County of Carle- ton Law Association, agreed Ottawa's family courts are in crisis and criminal and civil caseloads are also high. He says management of existing judicial resources and schedules is an important element in coping with the shortage. "You go down there [to the court house] at 2 o'clock on any given day and you can basically bowl in the hall- ways and you won't hit anything because there's nobody there," he says. "But in the morning when cases are be- ing adjourned, there's pandemonium." He nonetheless adds that the shortage of judges has resulted in precarious schedules for hearings that are booked with the hope there will be cancellations. "They'll double-book, sometimes triple-book with judges, hoping that two or three matters that had been scheduled to be heard by the judge will collapse or settle or go away somehow." Continued from page 1 Ottawa family court bench struggling LT REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS REPRINTS Been in Law Times? Want a record of it? Promote your law firm by ordering reprints of articles from the voice of the profession — Law Times! Reprints are great for: • Firm promotional material • Use on your web site • Training and education • • Suitable for framing • $175 - $225/reprint We provide a color PDF and unlimited reproduction rights. For more information or to order reprints, please e-mail Gail Cohen at: gcohen@clbmedia.ca LAW TIMES It's a 'well-reasoned' decision, says lawyer *Pages 1-16.indd 2 1/24/08 6:10:26 PM

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