Alistair Crawley

This endorsement arises from a case conference in a complex action involving TD Bank and numerous insurance underwriters.

The court addressed the management of three pending discovery motions (defendants' refusals, plaintiff's refusals, and defendants' motion for a second discovery representative) and trial management issues.

The court declined the plaintiff's request to expand their refusals motion, permitted the plaintiff to withdraw their existing refusals motion without prejudice, and vacated the scheduled trial date of September 13, 2021, as the action was not ready.

The court provided specific case management directions for completing discoveries, updating motion materials, and preparing for a future trial date.

The moving parties, Project Spokane, LLC and Sean Walsh, brought a motion for leave to appeal an October 8, 2020 order of Conway J. in a bankruptcy proceeding.

The Divisional Court dismissed the motion for leave to appeal and awarded costs of $5,000 to the responding parties.

In an insurance coverage action, the parties brought three motions regarding discovery refusals and the examination of a second discovery representative.

The judge determined that the motions were within the jurisdiction of a Master and, pursuant to the Toronto Region Consolidated Practice Direction, transferred the motions to a Master for determination.

The judge also ordered a case conference to address procedural deficiencies and ensure the orderly development of the motions for hearing.

The applicants sought an order requiring the respondent credit union to return approximately $5,000,000 that had been held in their accounts.

The credit union, under administration by the regulator, had unilaterally collapsed the applicants' term deposits and appropriated the funds, claiming a right of set-off under the Credit Unions and Caisses Populaires Act, 1994 for unliquidated damages related to alleged fraud and breach of fiduciary duty.

The court held that the statutory right of set-off does not permit a financial institution to unilaterally appropriate funds for unliquidated and disputed claims without judicial determination.

The court ordered the credit union to restore the accounts to their previous state and compensate the applicants for lost interest.

The plaintiffs brought a motion to amend their Statement of Claim and add parties.

The defendants consented to the amendments but sought costs thrown away for steps already taken, including preparing the original statement of defence and securing productions.

The court dismissed the claim for costs thrown away, finding that the motion was not a last-minute application and the steps taken were not redundant or useless.

The court noted that the defendants could claim these costs at trial if successful.

The plaintiff, a debentureholder, sought to bring a class action for oppression against certain shareholders, directors, and officers of Discovery Air Inc. The defendants argued the plaintiff lacked standing due to a 'no-action clause' in the trust indenture, which they claimed required trustee authority or satisfaction of specific preconditions.

The court found that the trust indenture, when read holistically, did not preclude the plaintiff's direct action.

Alternatively, the court determined that the plaintiff had met the preconditions, including the 25% debentureholder support and a reasonable offer of indemnity, despite the trustee's commercially unreasonable demands.

The plaintiff's motion was granted, allowing the oppression action to proceed.

The appellants, an unsuccessful bidder and a dissenting shareholder, sought a stay of an order approving a plan of arrangement by which NordStar Capital LP would acquire Torstar Corporation, pending their appeal.

The Divisional Court dismissed the motion for a stay, finding that the appellants failed to establish a serious issue for appeal, irreparable harm, or that the balance of convenience favoured a stay.

The court noted that the appellants lacked standing, the hearing process was fair, and the board acted reasonably in rejecting the unsolicited offer in light of hard lock-up agreements.

Torstar Corporation sought court approval for a plan of arrangement to sell all its shares to NordStar Capital LP for $0.74 per share.

The arrangement was overwhelmingly approved by shareholders.

Competing bidder CMMH and dissenting shareholder Patrick Collins objected, alleging inadequate disclosure and a flawed bidding process due to hard lock-up agreements.

The court found the arrangement had a valid business purpose, the process was conducted in good faith with professional advice, and the objections were resolved fairly.

The court emphasized the weight given to the shareholder vote and the Board's business judgment, particularly in uncertain times, and approved the arrangement.

This is an appeal from a certification judge's order refusing to certify an investor class action and dismissing the action on the basis that the pleadings did not disclose a reasonable cause of action.

The proposed class action arose from the dramatic collapse of a derivatives-based exchange-traded fund (ETF) managed by the respondent, Horizons ETFS Management (Canada) Inc., which lost almost 90% of its value overnight.

The appellant, Graham Wright, alleged negligence and misrepresentations in the prospectus under s. 130 of the Securities Act.

The certification judge dismissed both claims.

The Court of Appeal allowed the appeal in part, finding that the negligence claim did disclose a reasonable cause of action.

For the s. 130 Securities Act claim, the Court found it did not disclose a reasonable cause of action as pleaded but granted leave to amend the statement of claim to assert the purchase of 'Creation Units', remitting the matter to the certification judge for further determination of certification criteria.

The defendants unsuccessfully moved to set aside ex parte orders granting the plaintiffs leave to register certificates of pending litigation and appointing a monitor.

The plaintiffs sought costs of the motion payable forthwith, while the defendants argued costs should be in the cause due to unproven allegations of civil fraud.

The court ordered the defendants to pay $5,000 forthwith for the portion of the motion relating to the certificates of pending litigation.

However, the court held that the $35,000 in costs for the portion relating to the monitor should be payable to the plaintiffs only if they are ultimately successful in the litigation.

The applicants, former owners of CryptoGlobal, sought the appointment of an independent inspector to investigate HyperBlock Inc. following an amalgamation.

They alleged oppressive conduct, conflict of interest by HyperBlock's CEO (Sean Walsh) in the acquisition of Project Spokane assets, overvaluation, and a significant post-closing decline in HyperBlock's value not fully explained by market forces.

The court found a prima facie case of oppression and an "index of suspicion" warranting an investigation, citing issues like cash flow irregularities, resignations of financial officers, lack of transparency, and potential conflicts of interest among management and directors.

The court ordered the appointment of BDO Canada Limited as an inspector.

The applicants sought to vary a previous judgment regarding the valuation of BitRush shares for cancellation due to misappropriation and to obtain additional relief including a buyout of the respondents' shares or cancellation of shares for unpaid costs.

The court allowed the amendment to the share valuation, reducing it from $0.09/share to $0.005/share for the purpose of compensating BitRush for misappropriated funds, thereby increasing the number of shares to be cancelled.

The court dismissed the requests for a buyout of the respondents' remaining shares and for the cancellation of shares to satisfy the costs order, but ordered that the respondents could not vote their remaining shares until costs were paid.

The applicants, two municipalities, sought leave to appeal decisions of the Ontario Municipal Board that granted them party status but limited the evidence they could present regarding a proposed aggregate pit.

The Board restricted their evidence to the incremental impact of truck traffic on their roads, preventing them from comparing alternative haul routes.

The Divisional Court granted leave to appeal, finding good reason to doubt the correctness of the Board's decisions as the limitations effectively prevented the Board from considering mandatory statutory factors under the Aggregate Resources Act, thereby breaching the rules of natural justice and procedural fairness.

The applicants sought relief under the oppression remedy provisions of the Business Corporations Act, alleging that the respondent Werner Boehm, as CEO and directing mind of MezzaCap Investments Ltd., engaged in oppressive conduct.

This included failing to secure technology rights for BitRush, misappropriating company assets (AdBit subsidiary and funds), and refusing to certify financial statements, leading to a cease trade order.

The court found Boehm's conduct oppressive, unfairly prejudicial, and in breach of fiduciary duty.

Remedies granted included declarations of oppression, orders for specific share transfers from MezzaCap Investments to Dr. Kalcher and HSRC Investments Pte.

Ltd. to rectify unfulfilled agreements, and cancellation of MezzaCap Investments' shares equivalent to misappropriated funds.

Other requested relief, such as cancellation of all remaining shares based on pre-RTO misrepresentations, was dismissed.

RBC Dominion Securities and Royal Bank of Canada Europe sued Crew Gold Corporation for a Success Fee under an investment banking engagement letter.

The parties' dispute centered on whether RBC was entitled to a Success Fee following an unanticipated takeover of Crew by Severstal, in which RBC played no role.

The trial judge found that a causal link between RBC's services and the transaction was required for the Success Fee to be payable, and dismissed RBC's action.

On appeal, RBC argued the trial judge committed extricable errors of law in interpreting the Agreement.

The Court of Appeal upheld the trial judge's decision, finding that the Agreement contemplated RBC's involvement in the transaction process and that the Success Fee was meant to reward RBC for its success in completing a transaction through its financial advisory services.

The respondent admitted to contravening the Securities Act by selling convertible debentures to 20 individuals without being registered.

Staff of the Commission and the respondent entered into a settlement agreement proposing an administrative penalty, costs, and a ten-year ban from participating in the capital markets.

The Ontario Securities Commission approved the settlement agreement, finding its terms reasonable and in the public interest, noting the respondent's cooperation and the deterrent effect of the agreed sanctions.

The law firm Crawley MacKewn Brush LLP (CMB) brought a motion seeking an order to be appointed as representative counsel for approximately 3,000 investors in the receivership of Crystal Wealth Management Systems Inc. The court-appointed Receiver, Grant Thornton Limited, and the Ontario Securities Commission opposed the motion, arguing that it would be duplicative of the Receiver's role and would result in unnecessary professional fees.

The court dismissed CMB's motion, finding that the Receiver was already adequately protecting and advancing the investors' interests, and that appointing representative counsel would add unnecessary expense without good reason.

The respondents moved to stay or dismiss the applicants' oppression remedy application under the Business Corporations Act, challenging the Ontario court's jurisdiction and arguing *forum non conveniens*.

They also sought to set aside service and argued the application was frivolous or vexatious.

The court found Ontario had jurisdiction due to the corporation's domicile and the exclusive jurisdiction of s. 248 of the OBCA.

The *forum non conveniens* argument was rejected as no alternate forum could hear the OBCA claims.

Service was deemed proper, and the frivolous/vexatious argument was dismissed.

The Ontario Securities Commission found that Pro-Financial Asset Management Inc. (PFAM) and its CEO, Stuart McKinnon, committed numerous breaches of Ontario securities laws.

PFAM acted as a market intermediary for principal protected notes (PPNs) and failed to deal fairly, honestly, and in good faith with its clients, resulting in a $1.2 million deficiency in the PPN trust account due to unsupported redemption requests and price variances.

PFAM also breached its standard of care as an investment fund manager, failed to maintain minimum working capital, failed to keep satisfactory records, and failed to maintain adequate compliance systems.

McKinnon, as a director and officer, was found to have authorized, permitted, or acquiesced in these breaches and failed to fulfill his responsibilities as Ultimate Responsible Person (URP) and Ultimate Designated Person (UDP).

The conduct was found to be contrary to the public interest.

The appellants appealed a decision of the Ontario Securities Commission finding they committed securities fraud and misrepresentation by selling nearly $19 million in securities without disclosing a highly critical financial report.

The Commission ordered significant administrative penalties and disgorgement of over $16.5 million.

On appeal, the Divisional Court upheld the Commission's findings, concluding that the failure to disclose the report while continuing to sell securities was objectively dishonest.

The Court also affirmed that reliance is not required for a misrepresentation finding under the Securities Act and that the Commission has broad public interest jurisdiction to order disgorgement of all funds raised through non-compliance, even if not personally retained by the wrongdoers.