Andrew Duncan Gray

The EMEA Debtors sought leave to appeal an order approving an Allocation Protocol that provided for a joint trial by the Ontario Superior Court of Justice and the US Bankruptcy Court for the District of Delaware to allocate over US$7 billion in proceeds from the sale of Nortel assets.

The moving parties argued the joint trial violated the Ontario court's independence and that the parties had previously agreed to binding arbitration.

The Court of Appeal dismissed the motion for leave to appeal, finding the proposed appeal lacked prima facie merit as the joint trial did not infringe judicial independence and the relevant agreement did not mandate arbitration.

Co-owners of a Toronto property brought an application under the Partition Act seeking an order for sale and directions regarding the method of sale.

While all parties agreed the property should be sold, they disagreed on whether the sale should proceed by public auction or by sealed bid.

The court discounted partisan affidavit evidence from the parties and professional firms with financial interests in the process.

Emphasizing the need to safeguard the integrity of the sales process and maximize value, the court concluded that a sealed-bid process was preferable in circumstances where some co-owners intended to bid on the property.

The court ordered the sale to proceed by sealed bid under the supervision of an independent sales officer, with final process terms subject to court approval.

The plaintiffs in a proposed class action for secondary market misrepresentation sought leave to appeal a decision quashing their summonses to two Manulife employees and refusing to compel the defendants to file affidavits on the upcoming leave motion under s. 138.8 of the Securities Act.

The Divisional Court dismissed the application for leave to appeal, finding no reason to doubt the correctness of the motion judge's decision, which followed established jurisprudence that defendants are not required to deliver affidavits or be subjected to cross-examination if they do not intend to lead evidence on the leave motion.

Application for a final order approving a corporate plan of arrangement under s. 182 of the Ontario Business Corporations Act.

The proposed transaction involved the acquisition and division of assets of the corporation among related entities, with shareholders receiving a combination of cash and shares.

The court reviewed the governing framework established in BCE Inc. v. 1976 Debentureholders, requiring that the transaction constitute an arrangement, comply with statutory and court-ordered procedures, be proposed in good faith, and be fair and reasonable.

Evidence showed overwhelming shareholder approval, provision of dissent rights, and oversight by an independent special committee with fairness advice.

The court concluded the arrangement had a valid business purpose and fairly balanced the interests of affected stakeholders.

The plaintiffs sought leave under s. 138.3 of the Securities Act and certification under the Class Proceedings Act to pursue a class action against CIBC and its senior officers for alleged secondary market misrepresentations concerning CIBC's exposure to the U.S. residential mortgage market.

The court found that the plaintiffs met the test for leave and certification for the statutory claim.

However, applying the Court of Appeal's recent decision in Sharma v. Timminco Limited, the court held that the statutory claim was time-barred because leave was not obtained within the three-year limitation period under s. 138.14 of the Securities Act.

Consequently, both motions were dismissed.

The appellants appealed a summary judgment decision regarding the operation of a limitation period.

The sole issue was whether the respondent repudiated the agreement when it demanded repayment in March 2008.

The Court of Appeal agreed with the motion judge's analysis and dismissed the appeal, awarding costs to the respondent.

Following certification of a class proceeding concerning foreign exchange transactions in registered accounts, the plaintiffs sought substantial indemnity costs based on an unaccepted offer to settle made prior to the certification motion.

The defendants argued the outcome of the certification motion was less favourable than the offer and disputed the amount of fees and disbursements claimed.

The court held that the result of the certification motion was as favourable as the plaintiffs’ offer within the meaning of Rule 49.10 and that the defendants’ objections were overly technical.

Certain fees and disbursements were reduced, but the court concluded the remaining amounts were fair and reasonable in light of the work required for the certification motion.

Substantial indemnity costs were awarded from the date of the offer to settle.

Mercer International Inc. applied to the Ontario Securities Commission for a simultaneous hearing with the Québec Bureau de décision et de révision to consider whether AbitibiBowater's take-over bid for Fibrek Inc. should be cease traded.

The Commission acknowledged it had jurisdiction to hear the application, as Fibrek is a reporting issuer in Ontario and the bid affected Ontario shareholders.

However, the Commission declined to exercise its jurisdiction, noting that the Bureau was already seized of the matter, the applicable securities laws were substantially similar, and a simultaneous hearing would not advance the harmonization and co-ordination of securities regulatory regimes.

The application was dismissed.

In a proposed securities class action alleging misrepresentations in the primary and secondary markets, the plaintiffs sought an order compelling defendants to deliver statements of defence and requested that the certification motion be heard together with a leave motion under s. 138.8 of the Securities Act.

The defendants opposed delivering defences before certification and sought a sequence of motions beginning with the leave motion, followed by Rule 21 motions and then certification.

The court held that pleadings should generally be completed before certification and that ordering the delivery of a statement of defence was not contrary to law or due process.

However, the court limited the requirement to defendants who filed affidavits under s. 138.8(2) of the Securities Act, while permitting other defendants to plead voluntarily without losing the ability to bring Rule 21 motions.

The court further ordered that the leave motion and certification motion be heard together to avoid delay, inefficiency, and serial appeals.

Following motions under the Partition Act concerning the sale of a jointly owned commercial property, the court determined the appropriate costs award.

The applicant sought partial indemnity costs significantly exceeding the guideline hourly rates published by the Costs Subcommittee of the Civil Rules Committee.

The court held that the guideline rates are not mandatory and may be exceeded where justified by factors such as inflation, the substantial monetary value of the dispute, the sophistication of the parties, and the retention of Toronto counsel.

Adjusted hourly rates above the guideline maximum were approved, but the overall costs claimed were reduced due to divided success on the motions.

The court ordered the respondent to pay partial indemnity costs of $20,000 plus disbursements.

The plaintiffs brought a motion for certification of a proposed class action against the defendants regarding foreign currency conversions in registered accounts.

The plaintiffs alleged that the defendants charged undisclosed, unnecessary, and unauthorized foreign exchange fees when converting foreign currency to Canadian dollars in RRSPs and other registered accounts.

The court found that the plaintiffs met all five criteria for certification under section 5 of the Class Proceedings Act, 1992, including disclosing causes of action for breach of contract, breach of fiduciary duty, and unjust enrichment.

The action was certified as a class proceeding.

Following dismissal of a commercial action, the successful defendant sought substantial indemnity costs after making a Rule 49 offer to settle.

The court held that where a defendant’s settlement offer involves payment and the action is dismissed entirely, Rule 49 does not automatically permit substantial indemnity costs.

Relying on appellate authority limiting earlier jurisprudence, the court concluded substantial indemnity costs are only appropriate where egregious conduct is demonstrated.

While the defendant’s legal rates were reasonable, the court found some time spent excessive.

Applying the factors in Rule 57.01, the court fixed a reduced partial indemnity costs award including disbursements.

The appellants appealed a summary judgment dismissing their claim for indemnification under a commercial agreement due to failure to provide timely notice.

The Court of Appeal upheld the motion judge's interpretation that the 18-month notice requirement was a condition precedent to the right of indemnity.

The Court also rejected the argument that the notice provision was void under section 22 of the Limitations Act, 2002, holding that a contractual notice requirement does not vary or exclude a statutory limitation period, but rather acts as a condition precedent for a cause of action to accrue.

The Executive Director of the Ontario Securities Commission applied under s. 144 of the Securities Act to vary or revoke a prior Commission decision that required notice be given to two corporate account holders of a bank before disclosing compelled documents to a foreign regulator.

Staff also sought a sealing order for fresh evidence without disclosing it to the bank.

The Commission granted the sealing order but required confidential disclosure to the bank's counsel to ensure procedural fairness.

The Commission dismissed the s. 144 application, finding that Staff was improperly using the provision as an appeal mechanism, which is contrary to the legislative intent of the Act and the public interest.

Appeal and cross-appeal arising from limited partnership investment litigation involving an offering memorandum for a real estate tax shelter.

The court held that, read as a whole and in light of the financing and refinancing structure, the offering memorandum contemplated repayment of accrued interest and principal on the second secured loans only upon acceptable refinancing of the first loans; because that refinancing never occurred, the investors were not contractually obliged to repay the second loans.

The court also held that the cash flow loans were not expressly made repayable by investors under the offering documents.

On the cross-appeal, the court held that the contractual deemed-reliance clause was included to satisfy securities-law requirements and did not create a broader right to sue for misrepresentation outside the clause's 90-day notice period.

Both the appeal and cross-appeal were dismissed, with no costs.

The plaintiff condominium corporation appealed a Master's order refusing leave to amend its statement of claim to add a related company as a defendant and assert a fraudulent conveyance claim regarding two mortgages.

The Master found the proposed claim was statute-barred under the Limitations Act, 2002.

On appeal, the Divisional Court upheld the Master's decision, confirming that a fraudulent conveyance action is a 'claim' under the new Limitations Act, 2002, and is subject to the basic two-year limitation period.

The court also agreed that the plaintiff was seeking consequential relief, meaning the exemption for purely declaratory relief did not apply, and found no palpable and overriding error in the Master's conclusion that the claim was discoverable more than two years before the proposed amendment.

Staff of the Ontario Securities Commission sought an order under subsection 17(1) of the Securities Act to permit a foreign securities regulator to disclose compelled documents to a foreign criminal law enforcement agency.

The documents related to two account holders and were obtained from a bank via a summons.

Staff argued that notice to the account holders was not required.

The Commission held that the account holders, who were named in the summons, were 'persons or companies named by the Commission' under subsection 17(2)(a) and were therefore entitled to reasonable notice and an opportunity to be heard.

The issue of whether their consent was required under subsection 17(3) was deferred until after notice was given.

NorthWest Value Partners Inc. applied for a hearing and review of two decisions of the Toronto Stock Exchange (TSX) regarding InterRent Real Estate Investment Trust: a decision accepting notice of a private placement without requiring unitholder approval, and a decision allowing InterRent to postpone its annual meeting.

On preliminary motions, the Ontario Securities Commission granted intervenor status to CLV Group Inc., denied NorthWest's request for disclosure of the subscribers' names, and concluded it would defer to the TSX's decision on the private placement as NorthWest failed to establish grounds for intervention under the Canada Malting test.

The Commission also dismissed the request to review the meeting date decision because it was filed outside the 30-day statutory time limit.

The applicant, Y, applied under section 17 of the Securities Act for disclosure of compelled and voluntary evidence obtained by the Ontario Securities Commission during an investigation.

Y sought the evidence to make full answer and defence to criminal fraud charges.

The Commission balanced Y's right to make full answer and defence against the privacy interests of the witnesses who provided the evidence.

The Commission granted disclosure for witnesses who consented or did not object, and for those who opposed but were on the Crown's witness list, subject to strict confidentiality terms.

Disclosure was denied for opposing witnesses not on the Crown's witness list.

NorthWest Value Partners Inc. applied for a hearing and review of two decisions of the Toronto Stock Exchange (TSX) regarding InterRent Real Estate Investment Trust.

The TSX had allowed a private placement to proceed without unitholder approval and permitted a delay in the annual meeting.

The Ontario Securities Commission granted intervenor status to CLV Group Inc. but denied it to Mike McGahan.

The Commission declined to order disclosure of the private placees' names to protect their privacy.

Applying the Canada Malting test, the Commission deferred to the TSX Listing Committee Decision, finding no grounds to intervene.

The application to review the TSX Meeting Date Decision was dismissed as it was filed out of time.