COURT OF APPEAL FOR ONTARIO
CITATION: Benzacar v. Terk, 2023 ONCA 773
DATE: 20231120
DOCKET: COA-22-CV-0457
Lauwers, Zarnett and Thorburn JJ.A.
BETWEEN
Anouk Benzacar
Applicant (Appellant)
and
Ira Terk
Respondent (Respondent)
and
6990371 Canada Inc., 6044402 NB Ltd., and 4106971 Canada Inc.
Responding Parties (Respondents)
Chris MacLeod and N. Joan Kasozi, for the appellant
Christopher A.L. Caruana, for the respondents 6990371 Canada Inc., 6044402 NB Ltd., and 4106971 Canada Inc.
Ira Terk, acting in person[1]
Heard: August 25, 2023
On appeal from the order of Justice Susan Vella of the Superior Court of Justice, dated November 10, 2022, with reasons reported at 2022 ONSC 6338.
Zarnett J.A.:
INTRODUCTION
[1] The appellant, Anouk Benzacar, and the respondent, Ira Terk, are former spouses. For many years Ms. Benzacar has been attempting to collect amounts Mr. Terk was ordered to pay to her under a 2011 Quebec Superior Court judgment and a 2017 Ontario Superior Court order. Mr. Terk’s behaviour in avoiding payment of amounts he has owed for more than a decade has been the subject of judicial criticism. He was described by Mayer J. of the Quebec Superior Court in 2021 as “playing one courtroom against the other … zigzagging and avoiding all efforts to collect … making preferential payments to others and insisting he is a penniless victim”.
[2] This appeal arises out of one of Ms. Benzacar’s efforts to collect the debt owing by Mr. Terk – her exercise of the garnishment remedy in r. 60.08 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. Ms. Benzacar sought to garnish debts owing to Mr. Terk by the respondents 604402 NB Ltd. (“604”) and 4106971 Canada Inc. (“410”). Among other relationships, Mr. Terk is a salaried employee of 604 and, through a corporation that was found by the motion judge to be his alter ego, is a recipient of management fees it pays.
[3] Under r. 60.08 a creditor, such as Ms. Benzacar, who holds an order for the payment of money may enforce it by garnishment of debts payable to the debtor (here Mr. Terk) by other persons (“garnishees” − here, 604 and 410). Once a notice of garnishment is served, the garnishees become liable to pay the sheriff any debt they owe to the debtor (including debts owing at the time of service of the notices and those coming due for the next six years) up to the amount owing to the creditor stated on the notice of garnishment. Where debts relate to wages, exemptions in the Wages Act, R.S.O. 1990, c. W.1 apply to make a portion of the debts exempt from garnishment.
[4] A garnishee who wishes to dispute the garnishment in whole or in part must serve a garnishee’s statement in a prescribed form within 10 days after service of the notice of garnishment. The form requires the garnishee to acknowledge what debts are or will be owing, or to explain why there are and will be none. Where a garnishee fails to serve a statement, the creditor is entitled to an order for payment of the amount the court finds is payable by the debtor to the garnishee, or the amount in the notice, whichever is less. A court may treat a garnishee’s statement that is materially false without reasonable justification as the equivalent of no statement at all.
[5] After being served with notices of garnishment in 2017, both 604 and 410 filed garnishee statements, prepared and signed on their behalf by Mr. Terk. The garnishee statements did not acknowledge that there were or would be any debts owing by either company to Mr. Terk. Only the part of each form applicable to a garnishee who does and will not owe any money to the debtor was filled out. However, between 2019 and 2021, 604 did pay certain amounts to the sheriff, representing 20% of the amounts it actually paid as salary in those years to Mr. Terk.
[6] On a motion by Ms. Benzacar contending that the response of the garnishees was inadequate, the motion judge granted certain relief. She found that the exemption for wages payable to Mr. Terk should be reduced, such that 40%, rather than 20%, of his salary was subject to garnishment. She also found that 40% of the management fees paid by 604 to Mr. Terk’s alter ego company was subject to garnishment and should have been paid to the sheriff.
[7] The primary issue raised by Ms. Benzacar on appeal is that the relief granted by the motion judge did not go far enough. She submits the motion judge erred in declining to find that the garnishee statement of 604 was so deficient as to be the equivalent of no statement at all, which would have rendered 604 liable for the entire debt owed by Mr. Terk to Ms. Benzacar. For the reasons that follow, I conclude that the motion judge erred in failing to grant this relief.
[8] The purpose of a garnishee statement is to accurately delineate the issue between the creditor and the garnishee − it is not the first step in “a catch me if you can” process. 604’s statement was the antithesis of what was required. It did not acknowledge the debts it did and would owe to Mr. Terk, and it could only be read as falsely claiming there were and would be no debts. It was, functionally, no statement at all. The motion judge ought to have given effect to Ms. Benzacar’s entitlement to an order against 604 as a garnishee who had failed to comply with this fundamental obligation.
Background
[9] By a judgment dated May 24, 2011, the Quebec Superior Court ordered that Mr. Terk pay Ms. Benzacar, among other amounts, $130,000 with interest from May 1, 2004. This sum represented Ms. Benzacar’s remaining share of the proceeds of the sale of their home.
[10] Mr. Terk completely failed to honour this aspect of the Quebec judgment. Ms. Benzacar took steps to enforce the Quebec judgment in Ontario. On March 8, 2017, an Ontario Superior Court order was made directing Mr. Terk to pay the amount then outstanding under Quebec judgment − $227,097.70 − plus prejudgment interest in the sum of $8,965.70, and costs in the amount of $4,000. Post judgment interest was fixed payable at the rate of 11% per year commencing on March 8, 2017. Mr. Terk completely failed to honour the Ontario order as well.
[11] On October 10, 2017, on the requisition of Ms. Benzacar, the registrar of the Superior Court issued notices of garnishment to 604 and 410, two corporations with which Mr. Terk was associated.
[12] The notices of garnishment required each of 604 and 410 to pay to the sheriff on behalf of Ms. Benzacar: (i) all debts then payable to Mr. Terk within 10 days after service; and (ii) all debts that would become payable to Mr. Terk during the six years following service within 10 days after they become payable, subject to the exemptions provided by s. 7 of the Wages Act. The notices of garnishment stated that the total debt owed to Ms. Benzacar was $256,143.49 less $10 for the cost to 604 and 410 of making required payments.
[13] The notices of garnishment contained a direction that if the total amount of $256,143.49 less $10.00 per payment was not made within 10 days after the notices were served, then 604 and 410 were each required to file a garnishee’s statement in the prescribed form. That form is Form 60I under the Rules of Civil Procedure.
[14] Form 60I − the required form of garnishee statement − has four paragraphs.
[15] The first paragraph is applicable if the garnishee owes or will owe money to the debtor. The garnishee is to “acknowledge that I/we owe or will owe the debtor … the sum of $_____ payable on (date) because (give reasons why you owe the debtor … money”. The instructions on the form explain that in respect of this statement, if payments of less than what is owed were being made the reason is to be given and, if the debtor is owed wages, the frequency of payments and the gross and net amounts are to be provided.
[16] The second paragraph is applicable if no money is owed to the debtor. The form explains: “If you do not owe the debtor money, explain why. Give any other information that will explain your financial relationship with the debtor.”
[17] The third paragraph is applicable if the garnishee was served with other notices of garnishment or writs of execution on behalf of the debtor; the fourth if the garnishee was served outside of Ontario and contested service.
[18] Each of 604 and 410 filed a garnishee’s statement dated November 6, 2017, using the required form. They were filled in and signed by Mr. Terk as the respective companies’ representative. He was, at the time, the sole director of each.
[19] The garnishee statements of both 410 and 604 left each of paragraphs 1, 3 and 4 blank. Only paragraph 2, the one applicable if no money was owed to Mr. Terk, was filled in.
[20] On the 410 garnishee statement, paragraph 2 read: “4106971 Canada Inc. is a shell corporation with no assets, activity or employees.”
[21] On the 604 garnishee statement, paragraph 2 read: “The Company is insolvent and its bank has called in its loans. No alternate sources of funding have been found. The debtor is not taking salary.”
The Motion Judge’s Decision
[22] Ms. Benzacar moved for an order declaring that 604 and 410 are liable for payment of the outstanding sum under the 2011 Quebec judgment pursuant to r. 60.08.17 (the subrule applicable when no garnishee statement is served and filed). She also moved for orders for garnishment of 60% of Mr. Terk’s wages, and of payments made to Mr. Terk directly and indirectly through Ego Capital Corp. (“Ego Capital”).
[23] The motion judge recited the history of the matter, including various obstacles Ms. Benzacar had encountered in her attempt to enforce her rights under the 2011 Quebec judgment and the 2017 Ontario order. These included: examinations in aid of execution of Mr. Terk that were met with refusals and unfulfilled undertakings requiring motions; costs orders against Mr. Terk that he failed to pay; and a settlement agreement calling for Mr. Terk to pay a reduced amount to satisfy his debt to Ms. Benzacar, that he failed to honour and then litigated about in the Quebec Superior Court in a manner that Mayer J. of that court termed “abusive” and “excessive and unreasonable”. The motion judge was satisfied that “Mr. Terk’s conduct throughout this litigation and the proceedings before Mayer J. demonstrate an intent not to pay anything further towards the 2011 [Quebec] Judgment irrespective of his personal financial circumstances”. By reason of his failure to make any effort to honour costs awards, she declined to consider any evidence he gave.
[24] The motion judge then turned to whether any wages payable by the garnishees to Mr. Terk should be subject to an exemption from seizure or garnishment less than the presumptive 80% provided for by s. 7(2) of the Wages Act. She held that it was just in the circumstances to reduce the exemption to 60% pursuant to the discretion to do so under s. 7(4) of the Wages Act.
[25] She then found that, prior to the issuance of the notices of garnishment, Mr. Terk was earning approximately $220,000 per year plus an automobile allowance. Before 2017, 604 paid 50% of this amount, with a related company paying the other 50%; after that 604 became the sole payor of his salary. She found that Mr. Terk stopped receiving the “full $220,000 plus car allowance” from 604 after Ms. Benzacar applied to enforce the Quebec judgment in Ontario, something she observed was “more than a coincidence”. She found that in 2019 he resumed receiving salary and that a portion of these payments (totalling about $30,000) was ultimately remitted to the sheriff by 604.
[26] The motion judge also found Ego Capital to be Mr. Terk’s alter ego, and that it was receiving $12,000 per year from 604 as management fees before the notices of garnishment were served. She found management fees continued to be paid by 604 to Ego Capital in 2019, 2020 and 2021, with knowledge “that [604] was really paying the fees to Mr. Terk”. No part of these payments had been remitted to the sheriff.
[27] The motion judge rejected an argument of Ms. Benzacar that a payment of $115,000 to Ego Capital by a 604 subsidiary, Canadian Business Television Inc. (“CBTI”), was subject to garnishment. Most of the funds were paid before the notices of garnishment were served, CBTI was never served with such a notice, and the payment flowed through 604 ostensibly for tax reasons.
[28] She also rejected an argument by Ms. Benzacar that she should infer other payments must have been made to Mr. Terk by the garnishees. The evidence did not establish that Mr. Terk had concealed income in the garnishees or that they “have withheld payments of income to Mr. Terk in a conspiracy to assist him in avoiding his judgment debt obligation and … to avoid payments due under the Notices of Garnishment”.
[29] The motion judge went on to consider Ms. Benzacar’s argument that the garnishee statements filed by 604 and 410 were “incomplete and therefore ought to be treated as if they were never filed, with the consequence that r. 60.08(17) should apply and 604 and 410 ordered to pay the entire judgment debt”.
[30] She rejected this submission stating:
[85] I do not find the failure to fill out Item 1 to render these Garnishee’s Statements to be null and void. The explanations provided in answer to Item 2 explains that there is no debt owed to Mr. Terk. No authority was cited by Ms. Benzacar to support her position that the failure to complete item one results in a null and void statement.
…
[87] The evidence is that 410 Inc. has not, and does not, owe any monies to Mr. Terk as it is not operating any business.
[88] With respect to 604 Ltd., as indicated above, it has made payments to the sheriff pursuant to the Garnishment Notice, which became due subsequent to the filing of the Garnishee’s Statement. This reflects the common practice.
[89] Accordingly, I find that there is no basis upon which to exercise the discretion I have to order that the Garnishee Companies should pay the entire outstanding judgment debt of Mr. Terk.
[31] In the result, the motion judge ordered that the wage exemption under the Wages Act be reduced to 60% (with Ms. Benzacar having the right to garnish 40% of Mr. Terk’s net income), and that 40% of the management fees paid by 604 to Ego Capital from November 6, 2017 were to be paid to the sheriff[2].
Analysis
Issues on Appeal
[32] Ms. Benzacar raises three issues. First, she submits that the motion judge erred in failing to find that 604 filed a false garnishee statement and that as a consequence, 604 was liable for the entire judgment debt owed to her. Second, she submits that the motion judge erred in failing to find that the CBTI payment was subject to the garnishment. Third, she submits that a salary for 2018 ought to be imputed to Mr. Terk and 40% of it should be garnished.
[33] Because of my disposition of the first issue, it is unnecessary to address the others.
The Relevant Rules About Garnishment
[34] I set out the text of the relevant parts of r. 60.08:
Where Available
60.08 (1) A creditor under an order for the payment or recovery of money may enforce it by garnishment of debts payable to the debtor by other persons.
…
Obtaining Notice of Garnishment
(4) A creditor under an order for the payment or recovery of money who seeks to enforce it by garnishment shall file with the registrar where the proceeding was commenced a requisition for garnishment (Form 60G) together with a copy of the order as entered, any other evidence necessary to establish the amount awarded and the creditor’s entitlement and an affidavit [with prescribed information.]
…
(6) On the filing of the requisition and affidavit required by subrule (4), the registrar shall issue notices of garnishment (Form 60H) naming as garnishees the persons named in the affidavit and shall send a copy of each notice of garnishment to the sheriff of the county in which the debtor resides or, if the debtor resides outside Ontario, to the sheriff of the county in which the proceeding was commenced.
Duration and Renewal
(6.2) A notice of garnishment remains in force for six years from the date of its issue and for a further six years from each renewal.
…
Service of Notice of Garnishment
(7) The creditor shall serve the notice of garnishment,
(a) on the debtor, together with a copy of the affidavit required by subrule (4); and
(b) on the garnishee, with a blank garnishee’s statement (Form 60I) attached.
…
Garnishee Liable from Time of Service
(11) The garnishee is liable to pay to the sheriff any debt of the garnishee to the debtor, up to the amount shown in the notice of garnishment or supplementary notice of garnishment, less $10 for the cost of making each payment, within ten days after service on the garnishee or ten days after the debt becomes payable, whichever is later.
(12) For the purposes of subrule (11), a debt of the garnishee to the debtor includes,
(a) a debt payable at the time the notice of garnishment is served; and
(b) a debt payable (whether absolutely or on the fulfilment of a condition) after the notice is served and within six years after it is issued.
…
Payment by Garnishee to Sheriff
(14) A garnishee who admits owing a debt to the debtor shall pay it to the sheriff in the manner prescribed by the notice of garnishment, subject to section 7 of the Wages Act.
When a Garnishee Must Serve Statement
(15) A garnishee who wishes for any reasons to dispute the garnishment or who pays to the sheriff less than the amount set out in the notice of garnishment because the debt is owed to the debtor and to one or more co-owners or for any other reason shall, within 10 days after service of the notice of garnishment, serve on the creditor and the debtor and file with the court a garnishee’s statement (Form 60I) setting out the particulars.
Garnishment Hearing
(16) On motion by a creditor, debtor, garnishee, co-owner of the debt or any other interested person, the court may,
…
(b) determine the rights and liabilities of the garnishee, the debtor, any co-owner of the debt and any assignee or encumbrancer;
…
(d) determine any other matter in relation to a notice of garnishment[.]
…
(17) Where the garnishee does not pay to the sheriff the amount set out in the notice of garnishment as owing by the garnishee to the debtor and does not serve and file a garnishee’s statement, the creditor is entitled on motion to the court, on notice to the garnishee, to an order against the garnishee for payment of the amount that the court finds is payable to the debtor by the garnishee, or the amount set out in the notice, whichever is less.
The Standard of Review
[35] The corporate respondents argue that the motion judge’s order was entirely discretionary and is accordingly subject to appellate deference. They place significant reliance on the following statement in Entes Industrial Plants Construction & Erection Contracting Co. Inc. v. Centerra Gold Inc., 2023 ONCA 294, 481 D.L.R. (4th) 160, at para. 10:
Garnishment is a statutory, and not a common law, remedy; it is a broad, equitable, discretionary remedy: Waxman v. Waxman (2006), 2006 CanLII 35815 (ON CA), 216 O.A.C. 379, at para. 37. Rule 60.08(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, provides that garnishment is available as follows: “A creditor under an order for the payment or recovery of money may enforce it by garnishment of debts payable to the debtor by other persons.” Rule 60.08(16) allows the court, in response to a garnishment motion, to make any order it deems just: 20 Toronto Street Holdings Ltd. v. Coffee, Tea or Me Bakeries Inc. (2001), 2001 CanLII 28048 (ON SC), 53 O.R. (3d) 360, at para. 5. The court’s order is entitled to appellate deference, absent reversible error. We see no such error here”.
[36] In Entes, the court was speaking of orders made under r. 60.08(16), which contains broad discretionary language. That language is not found in r. 60.08(17), upon which Ms. Benzacar relies.
[37] Subrule 60.08(17) speaks of a creditor’s entitlement to an order in the lesser of two specified amounts if a garnishee statement is not served and filed. Under that subrule, the first inquiry is whether a garnishee’s statement has been served and filed − as discussed below, this includes determining whether a statement that was served and filed is, by reason of material misrepresentations or omissions, in effect no statement at all, a question of mixed fact and law. If no statement has been served and filed, the court’s second task is to determine the amount payable by the garnishee to the debtor, another question of mixed fact and law. The court’s third task is, as a matter of law, to give effect to the creditor’s entitlement to an order in the lesser of the amount payable by the garnishee to the debtor or the amount in the notice. The usual appellate standards of review to each of these inquiries should apply. The court is not granted a discretion to do other than as the subrule dictates.
When a Materially Misleading Garnishee’s Statement Is Considered to be the Equivalent of No Statement
[38] Both parties accept the proposition that if a garnishee statement proves to be false, the court may treat the garnishee as though it has not filed the required statement at all: Turchiaro v. Liorti, [2004] O.J. No. 6289 at paras. 16-17, aff’d [2006] O.J. No.1113 (C.A.).
[39] Although the proposition in Turchiaro has not been the subject of extensive treatment in the case law, in my view it is subject to two caveats. First, for the proposition to apply the statement must be materially false. Second, there must be no reasonable justification for the statement’s incorrect content. The first caveat underscores that it is falsehoods that undermine the essence of what the statement should have conveyed that are the concern; the second underscores that good faith positions taken or assertions made by a garnishee with reasonable care and on a plausible factual scenario will not engage the proposition even if later proven to be incorrect.
[40] So expressed, this proposition fits comfortably within the structure of the garnishment process in r. 60.08. A garnishee statement is critical to the efficiency and efficacy of that process. A garnishee must file a garnishee statement if it wishes to contest the garnishment, in whole or in part: r. 60.08(15). The seriousness of this obligation is underscored by the fact that there is a prescribed consequence for failing to file such a statement: r. 60.08(17).
[41] The statement must acknowledge what is or will be owing or declare that nothing is or will be, with an explanation. An acknowledgment that there is a debt owing by the garnishee to the debtor triggers an obligation on the garnishee to make a payment to the sheriff: r. 60.08(14). A proper denial of any debt, with a proper explanation, provides the creditor with information so that it may consider what other steps might be taken. A garnishee statement that falsely claims no debt is or will be owing when one is or will be, or that provides misleading or incomplete information in support of a false assertion of no indebtedness, is the antithesis of what is required of a garnishee statement. It avoids the immediate obligation to make payments to the sheriff, may send the creditor in the wrong direction, and necessitates further steps and expenditures by the creditor to determine the true state of affairs.
[42] Whether a garnishee statement is materially false without reasonable justification must be judged by assessing it as a whole, taking into account what it says and what it omits to say on the subjects the statement is required to address.
The Motion Judge Erred in Her Approach to the 604 Statement
[43] In my view, the motion judge failed to assess 604’s statement against the facts that she had found and in light of the clear message it conveyed as a whole. She thus made an extricable error of law, justifying appellate interference.
[44] The 604 statement left the first required paragraph totally blank. That paragraph must be filled in when the garnishee has or will owe money to the debtor. The 604 statement did fill in the second paragraph. That paragraph is only applicable when there is or will be no money owing by the garnishee. The clear import of the statement is that there were and would be no debts owing by 604 to Mr. Terk.
[45] But, as counsel for the corporate respondents fairly conceded in oral argument, 604 was indebted to Mr. Terk at the time of the garnishee statement, and the first paragraph should have been filled in and so indicated. This concession is consistent with the motion judge’s findings of fact. There were employment arrangements between 604 and Mr. Terk that gave him an entitlement to salary from 604, and management fee arrangements that gave his alter ego, Ego Capital, an entitlement to payments for his benefit from 604. These were ongoing obligations that were not extinguished because Mr. Terk was not taking the “full $220,000 plus car allowance” for some period after Ms. Benzacar commenced enforcement proceedings in Ontario. There was no evidence, or any finding by the motion judge, that Mr. Terk’s entitlement to receive those payments in full was released.
[46] Moreover, the required form for a garnishee statement requires disclosure not only of what is owed but of what the garnishee will owe because of arrangements existing when the garnishment notice is served. This is consistent with rr. 60.08(11-12) which provide that garnishment covers not only existing debts but those that come due within six years of the service of the garnishment notice. The salary and management fee arrangements existing at the time the garnishment notice was served would result in debts of 604 to Mr. Terk that would fall due in the period following the service of the garnishment notice. 604’s statement failed to make this necessary disclosure.
[47] Neither of the assertions in the second paragraph of 604’s statement ameliorated its fundamental falsity.
[48] The assertion that 604 was insolvent as its bank had called in its loans was irrelevant to the existence and continuing accrual of debts to Mr. Terk. Insolvency “is the factual situation that arises when a debtor is unable to pay its creditors”: Century Services Inc. v. Canada (Attorney General), 2010 SCC 60, [2010] 3 S.C.R. 379, at para. 10. It does not wipe out nor negate the existence of the debts. There was no evidence that 604 was the subject of any formal insolvency proceedings that would stay enforcement of debts. And as I have already pointed out, that Mr. Terk was not taking his salary did not mean that 604 was not, and would not be, indebted to him for it.
[49] 604’s garnishee statement was materially false. No reasonable justification for the inaccurate statement has been suggested. I reject the argument that the fact that Mr. Terk filled out the statement for 604 somehow lessens 604’s responsibility for it or could be a reasonable justification for its inaccuracy. He was, at the time, 604’s only director and was well positioned to know exactly the arrangements between them.
[50] Neither 604’s payment to the sheriff of a portion of the salary payments it actually made to Mr. Terk after the notice of garnishment was served, nor the motion judge’s order requiring payment to the sheriff in respect of payments by 604 to Ego Capital, cure the falsity of the statement itself. Moreover, as the motion judge noted, the remittances to the sheriff were strategically timed around Mr. Terk’s settlement agreement gambit, and the order with respect to payments to Ego Capital was obtained only after Ms. Benzacar had to litigate − something an accurate statement would have avoided.
Ms. Benzacar Was Entitled to the Remedy in r. 60.08(17)
[51] The motion judge refused to make an order under r. 60.08(17). In my view, she erred in this regard. The garnishee statement was materially false without reasonable justification and should have been treated as no statement at all.
[52] Ms. Benzacar was “entitled … to an order against [604] for payment of the amount that the court finds is payable to the debtor by the garnishee, or the amount set out in the notice, whichever is less”: r. 60.08(17). In other words, Ms. Benzacar was entitled to an order for payment by 604 of the amount in the notice of garnishment served on 604 ($256,143.49), unless the amount payable by 604 to Mr. Terk was less than that amount.
[53] The phrase “amount … payable to the debtor by the garnishee” in r. 60.08(17) would appear to refer to the amount payable at the time the court makes (or should have made) a finding on this issue, which here would be the date of the motion judge’s decision.
[54] The motion judge did not make a specific finding of what amount was payable to the debtor, Mr. Terk, by the garnishee, 604. She implicitly found he actually received total salary of $150,000 after November 6, 2017, as she noted that 20% of what 604 paid Mr. Terk from 2019 to 2021 had been paid was remitted to the sheriff, and the total remitted was about $30,000. She also found that management fees had been paid to Ego Capital, for Mr. Terk, without specifying the amount (other than the pre-garnishment amount, which was $12,000 per year). She found that a conspiracy to defer or conceal income had not been shown.
[55] I do not consider the motion judge’s findings to be the equivalent of a finding that nothing more was payable by 604 to Mr. Terk than what was actually paid to him up to the time of her decision. Rule 60.08(17) uses the term “payable,” which refers to a debt that is due and the time for payment has arrived. It is not synonymous with “paid”. Indeed, the form for garnishee statements contemplates that there will be situations in which a garnishee is paying less that what is owed. Nor is it necessary to find a conspiracy to defer payments to reach the conclusion that all amounts payable have not been paid.
[56] I agree with Ms. Benzacar’s argument that what was payable by 604 to Mr. Terk exceeded what was paid and exceeded the amount in the notice of garnishment. As Ms. Benzacar points out, the motion judge found that the salary arrangements in place for Mr. Terk prior to service of the notice of garnishment called for payments of $220,000 per year plus car allowance. The entitlement is supported by a corporate resolution of 604’s parent company calling for Mr. Terk to be paid these amounts. As Ms. Benzacar notes, there is no evidence of any resolution modifying this entitlement. Accordingly, Mr. Terk’s legal entitlement to salary was, in the relevant time frame, always for these amounts, which clearly exceeds what he was paid. The accumulation of salary (pre and post notice of garnishment) from the period when the motion judge found he stopped taking his full salary in 2016 to the time of the motion judge’s decision almost six years later totals more than the amount in the notice ($256,143.49), even after giving effect to the Wages Act exemption as determined by the motion judge, and any amounts she found had actually been paid.
CONCLUSION
[57] Accordingly, I would allow the appeal, and vary the order below to direct that 604 shall pay the sheriff the amount of $256,143.49, less any amounts it has paid to date to the sheriff under the garnishment notice.
[58] Ms. Benzacar is entitled to costs of the appeal in the amount of $8,000, inclusive of disbursements and applicable taxes.
Released: November 20, 2023 “P.D.L”
“B. Zarnett J.A.”
“I agree. P. Lauwers J.A.”
“I agree. Thorburn J.A.”