Executive Summary: Key Legal and Evidentiary Issues

• Chad Gustafson, as mortgagee, lacked standing to independently apply to amend a 2022 order nisi obtained by a different plaintiff.
   
• Terry Gustafson, as the named defendant and landowner, retained standing to seek the same relief, but his application failed on the merits.
   
• Delay, absence of a live foreclosure action, and improper "piggybacking" on the 2022 order were among seven independent grounds for dismissing the amendment applications.
   
• A purported farmland lease to Lionsgate Farms was found void as a fraudulent conveyance under both The Fraudulent Preferences Act and the Statute of Elizabeth.
   
• Numerous "badges of fraud" — including below-market rent, non-arm's-length parties, and metadata suggesting the lease was backdated — supported the fraud finding.
   
• The Sheriff's court-authorized sale of the farmland was permitted to proceed, with costs awarded against Chad and Terry.
   

Facts of the case

This decision arises from long-running litigation over farmland owned by Terry Blaine Gustafson ("Terry"). SSC Security Services Corp. ("SSC"), formerly Input Capital Corp. ("ICC"), held a collateral mortgage against 18 parcels of Terry's land, registered in 2014. Following extensive litigation, Kalmakoff J. granted judgment to ICC on May 17, 2018 in the amount of $4,399,435.09, later reversed on appeal, and Currie J. issued a separate judgment on September 28, 2021 for $8,809,872.21 plus costs. On March 31, 2022, Keene J. granted an Order Nisi for Sale of the farmland with a 30-day redemption period requiring payment of $4,120,192.32 plus interest and costs (the "2022 Keene Order"). Terry redeemed the land within that period using funds provided by his son, Terry Chad Gustafson ("Chad"), and SSC's mortgage was assigned to Chad on May 10, 2022 after payment of $4,210,995.79. Chad twice sought foreclosure relying on the 2022 Keene Order, and both attempts were dismissed, with the second dismissal upheld on appeal in 2025 SKCA 21. On August 5, 2025, Danyliuk J. authorized SSC to proceed with a Sheriff's sale of the farmland under the Enforcement of Money Judgments Act ("EMJA") and The Saskatchewan Farm Security Act; the Sheriff subsequently delegated conduct of the sale to SSC's counsel, McKercher LLP, on October 2, 2025. In late November 2025, SSC learned of a purported lease of most of the farmland from Terry to Lionsgate Farms, a partnership involving Terry's nephew Josh Gustafson. Chad and Terry then applied to amend the 2022 Keene Order to allow Chad to foreclose, obtain immediate possession, and stay the Sheriff's sale, while SSC applied to dismiss those applications and to void the lease.

Policy terms or contractual clauses at issue

The 2022 Keene Order expressly limited the right of redemption to Terry as mortgagor, a term the court found determinative in concluding the original foreclosure action was concluded and could not be revived by Chad. The Lionsgate Farms lease itself was scrutinized for its terms: an annual rate of $90,000, described as below market value, and the absence of any escape clause, which would have encumbered the farmland until 2028. Section 3 of The Fraudulent Preferences Act voids transfers made by an insolvent debtor with intent to defeat creditors, while the Statute of Elizabeth voids conveyances made with intent to hinder, delay, or defraud creditors regardless of insolvency. The EMJA's delegation and enforcement provisions were also central: section 4(1) permits the Sheriff to delegate sale functions to a judgment creditor, and section 34(2) preserves the Sheriff's discretion rather than imposing a duty running to other creditors; sections 103 and 105(3) provide for discharge of registered interests to allow transfer of clear title to a purchaser. The Land Titles Act, 2000 provisions requiring court confirmation of a Sheriff's sale (ss. 160.1, 160.3) were also considered, along with ss. 107(1)(d)-(e) and 109, which the court relied on to render the lease void and of no force and effect for purposes of the sale.

Reasoning and analysis

The court first dismissed Chad's objection to portions of an affidavit from a real estate broker, finding the broker's experience-based observations about unusual lease terms were admissible statements of fact rather than inadmissible opinion. On standing, the court held that Chad, as mortgagee, did not have standing to independently apply to amend the 2022 Keene Order, following the earlier ruling of Danyliuk J. to the same effect; Terry, as the named defendant and owner, did retain standing. Turning to the merits, the court identified seven independent reasons to dismiss both Chad's and Terry's applications: Chad's attempt to piggyback on an order to which he was not a party; nearly four years of delay since the 2022 Keene Order; the fact that the original foreclosure action was a "dead letter" once Terry redeemed the mortgage; the unamended style of cause following the assignment to Chad; public policy concerns about allowing an assignee to revive a concluded foreclosure action; the repeated and previously rejected nature of Chad's applications; and the applications' character as a collateral attack on the unappealed Danyliuk Order. On the lease, the court applied both the badges-of-fraud analysis under The Fraudulent Preferences Act and the five-part test from Palechuk v Fahrlander under the Statute of Elizabeth, finding the lease was for below-market consideration, made with knowledge of SSC's claim, and supported by metadata suggesting it was created well after its stated signing date. A Farm Land Security Board report dated March 14, 2024 was cited as evidence that Terry could not meet his judgment obligations, supporting a finding of insolvency. Finally, the court rejected arguments that the Sheriff's sale should be stayed, finding the sale was properly authorized by the unappealed Danyliuk Order, that the EMJA permits delegation to a judgment creditor's lawyers, and that the Land Titles Act's confirmation requirements provide adequate ongoing supervision.

Ruling and overall outcome

SSC was the successful party. The applications of Chad and Terry to amend the 2022 Keene Order, obtain possession, and stay the Sheriff's sale were dismissed, while SSC's applications — to dismiss those applications and to declare the Lionsgate Farms lease void as a fraudulent conveyance — were granted. The court confirmed the Danyliuk Order and directed the Sheriff to proceed with the sale, free of the voided lease. Costs were awarded to SSC on Column 3 of the Tariff of Costs, payable forthwith by Chad and Terry, with SSC entitled to collect the full award from either or both of them; the decision does not state a specific dollar figure for this costs award, so the amount is Not Specified.