Alfred J. Esterbauer

The Law Society of Ontario brought a professional misconduct application against the respondent lawyer regarding his involvement in a syndicated mortgage transaction.

The respondent argued he acted solely as a bare trustee and mortgage administrator, not as the lenders' lawyer.

The Tribunal found that the respondent was the lenders' lawyer and failed to serve them to the standard of a competent lawyer.

Specifically, he failed to meet with clients, advise them of material facts such as the appraised value of the property, comply with the loan agreement, and secure their interests before releasing funds.

The Tribunal also found he failed to comply with By-Law 9 by accepting incomplete and inaccurate disclosure forms.

A penalty hearing was ordered.

This costs decision addresses the allocation of costs for a distribution motion concerning competing claims over preserved funds in a complex fraud and investment scheme case.

The Trial Parties, who succeeded at trial on fraud, breach of fiduciary duty, conspiracy, and unjust enrichment claims, sought to recover their judgment from preserved funds.

The Settling Parties, who had reached settlement agreements with the defendants before trial, sought equitable liens and constructive trusts over the same preserved funds.

The court awarded costs to the Trial Parties against the Settling Parties, finding that the Settling Parties had deliberately delayed enforcement of their settlements and improperly sought to benefit from the Trial Parties' litigation efforts without bearing the associated costs and burdens.

The moving parties sought to amend a trial judgment and costs judgment dated August 15, 2022 and February 15, 2023, respectively, to add a defendant who was not named in their original statement of claim and against whom they did not pursue any cause of action.

The moving parties also sought to amend reasons for decision from a distribution motion to align with the proposed amendments.

The court found that the moving parties had deliberately chosen not to name the defendant as a party to their action despite opportunities to do so, had confirmed during discoveries that they were not suing her, and had not cross-examined her at trial.

The court held that it was functus officio and lacked jurisdiction to amend the judgments, and that Rule 59.06 did not provide grounds for the requested amendments.

The motion was dismissed on the basis that parties must present their entire case and not litigate by installment, and that the principle of finality must govern.

The plaintiff lender brought a motion for summary judgment on a collateral mortgage registered on the defendants' home.

The defendants counterclaimed alleging undue influence and unconscionability.

The court dismissed the lender's motion, finding genuine issues for trial regarding the interplay between undue influence, unconscionability, and independent legal advice.

The court also dismissed the motion of the defendants' son's lawyer, finding genuine issues regarding a conversation with the defendant.

However, the court granted summary judgment in favour of a lawyer friend of the son who had minimal involvement, finding no basis for liability.

The plaintiff, The Guarantee Company of North America, sought an extension of time to serve a statement of claim or to validate service in a construction indemnity action.

The court reviewed the lengthy delay in service, the explanations provided, and the resulting prejudice to the defendants.

The motion was dismissed, with the court finding the plaintiff failed to provide a reasonable explanation for the delay and that the defendants would be prejudiced in their ability to defend the action due to lost records and faded memories.

The appellant appealed the dismissal of his action for delay and the dismissal of his motion to extend the time to set the action down for trial.

The Court of Appeal for Ontario found no reversible error in the motion judge's decision, which concluded that the appellant's more than five years of delay was inordinate and inexcusable, causing prejudice to the respondents and the administration of justice.

The appeal was dismissed, affirming the lower court's decision to dismiss the entire action, even though only one respondent had sought dismissal for delay.

The Appellants appealed a motion judge's decision to enforce a settlement in a failed real estate transaction.

The Appellants argued the motion judge erred by refusing to exercise discretion not to enforce the settlement, claiming new expert evidence changed the case and their new counsel was unaware of the outstanding offer.

The Court of Appeal affirmed the motion judge's decision, finding he properly exercised his discretion by considering all relevant factors and concluding it was not a "rare case" warranting non-enforcement.

The appeal was dismissed.

The defendants, Altus Group Limited and Jason White, brought a motion for summary judgment to dismiss the action, arguing the plaintiff, Melvyn D. Eisen (the Trustee), lacked standing to represent 13 investors in a syndicated mortgage transaction.

The Trustee brought a cross-motion seeking a declaration of standing or, alternatively, to add or substitute the Investor Beneficiaries as plaintiffs.

The court dismissed the defendants' summary judgment motion, finding genuine issues for trial regarding the Trustee's standing and the timing of detrimental reliance.

The court also denied the Trustee leave to bring his cross-motion, concluding that adding or substituting parties at this late stage, after the action was set down for trial, was not warranted given the deliberate tactical choice made by the Trustee and the potential for further delays and prejudice to the defendants.

The moving party defendant sought a stay of proceedings, alleging the responding party plaintiff committed an abuse of process.

The original plaintiff assigned the action to a related corporation shortly before going bankrupt, but the plaintiff's former lawyer inadvertently failed to obtain an Order to Continue for over two years, continuing to litigate in the original plaintiff's name.

The moving party argued this delay prejudiced its ability to acquire the cause of action from the bankruptcy trustee.

The court dismissed the motion, finding the delay was due to the lawyer's inadvertence rather than intentional misconduct, and that the moving party suffered no prejudice as it failed to pursue its rights when it eventually learned of the assignment.

The plaintiffs sought to settle the terms of a formal Judgment following a successful motion to enforce a settlement agreement against the defendants.

The parties disagreed on several terms, including payment dates, the declaration of a fraudulent conveyance, the lifting of a Certificate of Pending Litigation, and the exchange of mutual releases.

The court adjusted the payment dates but awarded pre-judgment interest to prevent prejudice to the plaintiffs.

The court also held that the co-defendant was bound by the declaration regarding the fraudulent conveyance, as the settlement offer was made on behalf of both defendants.

The court declined to order mutual releases, noting they were unnecessary now that the settlement terms had become a judgment.

Following a judgment enforcing an offer to settle for $550,000, the plaintiffs sought substantial indemnity costs of $36,316.46.

The plaintiffs had previously offered to settle the motion for $500,000.

The court applied Rule 49.10(1) of the Rules of Civil Procedure, finding the plaintiffs were entitled to substantial indemnity costs as they obtained a judgment more favourable than their offer.

The court fixed costs at $30,000 inclusive of disbursements and HST.

The plaintiffs brought a motion to enforce acceptance of a Rule 49 offer to settle made by the defendants in litigation arising from a failed residential real estate transaction.

The defendants argued the offer was not a Rule 49 offer, lacked an essential term, and that it would be unjust to enforce it due to new expert evidence and a change in counsel.

The court found that the offer complied with Rule 49, was capable of acceptance, and the presumption that Rule 49 applied was not rebutted.

The court also determined that it was not one of those rare cases where it would be unjust to enforce the settlement, emphasizing that changes in case strength or counsel's unawareness do not typically justify non-enforcement.

The motion was granted, and judgment was issued in favour of the plaintiffs.

The defendant/moving party, Ms. Chen, brought a motion to set aside or vary a prior summary judgment that granted specific performance to the plaintiff/responding party, Mr. Lam, for the sale of a residential property.

Ms. Chen alleged that Mr. Lam misrepresented facts regarding the property's uniqueness and failed to disclose the purchase of another property, constituting fraud or misleading the court.

The court dismissed Ms. Chen's motion, finding that Mr. Lam's explanations for his property dealings were rational, the "fresh evidence" was not material to the original decision on uniqueness, and the evidence could have been discovered with reasonable diligence prior to the summary judgment.

The court concluded that Mr. Lam did not knowingly or recklessly make material misrepresentations or commit fraud.

The plaintiff successfully moved to set aside a registrar's order dismissing the action for delay.

In these supplementary reasons for costs, the plaintiff sought partial indemnity costs of approximately $10,000, while the defendant sought costs of the motion and costs thrown away, arguing the plaintiff was granted an indulgence.

The court held that because the plaintiff received an indulgence, it was fair to deprive the successful plaintiff of its costs.

The court also declined to award the defendant costs thrown away, finding no wasted steps analogous to setting aside a default judgment.

No order for costs was made.

This decision addresses the costs arising from a successful motion brought by Lexfund Inc. The court fixed Lexfund's partial indemnity costs, payable by the Ferro defendants, in the amount of $22,477.94, inclusive of disbursements and HST.

No other costs orders were made.

The plaintiff brought a motion to set aside a registrar's order dismissing its professional negligence action for delay.

The court applied the contextual test for setting aside an administrative dismissal, weighing factors including the explanation for delay, inadvertence, promptness of the motion, and prejudice.

Although the plaintiff failed to adequately explain a period of delay, the court found the deadline was missed due to inadvertence, the motion was brought promptly, and there was no actual prejudice to the defendant.

The motion was granted and the dismissal order was set aside.

The plaintiff condominium corporation brought a motion to set aside a registrar's order dismissing its construction deficiency action for delay.

The action, which sought $5,000,000 in damages primarily related to elevator issues, was dismissed after the plaintiff inadvertently missed the set down deadline.

The court applied the test from H.B. Fuller Company v. Rogers, finding that the plaintiff adequately explained the delay, moved promptly to set aside the order, and demonstrated that the failure was inadvertent.

Crucially, the court found no significant prejudice to the defendants, as the case relied heavily on documentary evidence which had been preserved.

The motion was granted and the dismissal order was set aside.

Lexfund Inc. brought a motion seeking to extend a timetable for several actions, extend time to elect to proceed with counterclaims, and to proceed against the estate of Lucio Anthony Ferro.

These actions, primarily debt collection for litigation funding loans, had been administratively dismissed for delay.

The court considered Lexfund's explanations for delay, the lack of prejudice to the defendants regarding the principal debt, and the principles of justice and proportionality.

While acknowledging Lexfund's counsel's "sloppy practice" the court found no deliberate intention to abandon the files and that the litigation should proceed on its merits.

The court granted the extensions and permission to proceed against the estate, but imposed conditions to mitigate prejudice to the individual defendants regarding interest, setting a simple interest rate of 5% per annum and limiting the period for which interest could be charged.

The appellant appealed the dismissal of his professional negligence action against a lawyer and an accounting firm on summary judgment.

The appellant had sold his software company to Microsoft in 1999 and received approximately $4.8 million through a family trust.

The Canada Revenue Agency reassessed him for approximately $2.4 million in taxes, interest and penalties, claiming section 75(2) of the Income Tax Act applied.

The appellant obtained rectification orders and ultimately had his tax liability reduced to approximately $57,000 after the Federal Court of Appeal ruled that section 75(2) did not apply.

The appellant claimed damages from the respondents for professional negligence, alleging they failed to advise him of the CRA's position and the likely expenses of disputing it.

The motion judge dismissed the claim against the lawyer for lack of evidence of retainer regarding the trust, and dismissed the claim against the accounting firm for failure to provide expert evidence establishing a breach of the standard of care.

The Court of Appeal upheld the dismissal, finding no error in the motion judge's application of the expert evidence requirement for professional negligence claims.

The appellants Cadesky & Associates and Barry Seltzer appealed a judgment of the Superior Court of Justice.

The cross-appellant George Jones abandoned the cross-appeal.

The Court of Appeal fixed costs in the amount of $3,750.00 for each of the cross-respondents.