Andrew McCoomb

Look Communications Inc. sued its former director, Gerald McGoey, and his holding company, Jolian Investments Limited, for breach of fiduciary duty.

The claim arose from the board's approval of $20 million in "Contingent Restructuring Awards" (CRAs) to directors, officers, and employees following the sale of the company's primary assets.

The court found that McGoey breached his fiduciary duty by approving excessive CRAs, particularly the equity cancellation payments based on an inflated share price and an unwarranted $2.4 million compensation payment to himself.

The court also found a breach regarding the advancement of legal fees for directors' defense against CRA-related claims.

The court rejected McGoey's defense of reliance on legal advice, as the advice was general and did not cover the quantum or allocation of payments.

The court ordered restitution and imposed a constructive trust over the funds received by McGoey/Jolian.

The representative plaintiff, Fanshawe College, sought to amend the class definition in a certified class proceeding alleging price-fixing of LCD panels.

Two amendments were proposed: a broad "all purchasers' amendment" to include all direct and indirect purchasers, and an "alternative amendment" to expand the list of named OEMs and distributors.

The court denied the "all purchasers' amendment" finding it an abuse of process as it attempted to re-litigate an issue previously abandoned and decided by the certification judge.

However, the court granted the "alternative amendment" as it was specifically contemplated by the certification judge and the claims were not found to be time-barred.

The Plaintiffs, a dentist and her professional corporation, brought a motion under Rule 21.01(1)(b) to strike paragraphs 6, 7, and 8 of the Statement of Defence and Counterclaim, which pleaded the defences of justification, qualified privilege, and fair comment in a defamation action.

Alternatively, they sought an order for particulars under Rule 25.10.

The court dismissed the motion, finding that the Plaintiffs were seeking evidence rather than material facts necessary for pleading.

The court emphasized that pleadings must contain sufficient information for the opposing party to know the case to meet, but not the evidence by which facts are proved.

The court also criticized the motion as unnecessary and a waste of judicial resources.

Nortel Networks Corporation and its Canadian debtor affiliates brought a summary judgment motion to dismiss claims by SNMP Research International, Inc. and SNMP Research Inc. for breach of contract, breach of confidence, and copyright infringement.

SNMP's claims arose from Nortel's post-CCAA filing sales of its business segments (LOBs), during which SNMP's proprietary software source code was allegedly transferred to purchasers without authorization.

The court dismissed SNMP's claim for disgorgement of Nortel's profits, finding no evidence that Nortel received revenue derived from the copyright infringement, as purchasers knew they were not acquiring rights to SNMP software and negotiated separate licenses.

However, the court held SNMP's damage claim in abeyance for six months, acknowledging ongoing discovery in a related U.S. proceeding and the possibility of future evidence regarding LOB purchasers' use of unlicensed SNMP software.

A third party brought a summary judgment motion seeking dismissal of a third party claim brought by a defendant in a construction-related subrogated action following flood damage to a property.

The defendant relied on contractual indemnity provisions to shift liability to the third party.

The court held that the anti-subrogation rule did not bar the third party claim because the defendant was not an insured under the builder’s risk policy.

However, the contractual provisions relied upon did not clearly indemnify the defendant for its own negligence, which must be expressed in the clearest terms.

The third party claim was therefore dismissed on summary judgment.

The appellants advanced funds to Cash Store, a payday lending company operating under CCAA protection.

They appealed a motion judge's dismissal of their claim that they were the sole legal and beneficial owners of loan payments and accounts receivable from Cash Store's customers.

The motion judge found that the actual practices of the parties, including the payment of interest and commingling of funds, reflected a debtor-creditor relationship rather than the principal-broker relationship set out in their agreements.

The Court of Appeal dismissed the appeal, finding no error in the motion judge's factual determinations.

The appellant landlord appealed a decision dismissing its application for a declaration that the respondent tenant's installation of an ATM violated the permitted use clause of their commercial lease.

The lease restricted the premises to use as a fast-food restaurant.

The application judge found the ATM was a business tool to keep costs low and did not change the purpose of the premises.

The Court of Appeal applied the deferential standard of review for contractual interpretation established in Sattva, finding no error of law or mixed fact and law, and dismissed the appeal.

The applicant mining company brought a motion to strike portions of a respondent’s affidavit and factum on the basis that they disclosed communications made during settlement negotiations.

The court considered the principles governing settlement privilege as articulated by the Supreme Court of Canada and the conditions required for the privilege to arise.

It found that a litigious dispute existed or was contemplated at the time of the communications, the communications were made with an implied intention of confidentiality, and their purpose was to attempt settlement of the dispute.

As no competing public interest justified disclosure, the communications were protected by settlement privilege.

The court ordered that the impugned passages and documents be struck or expunged from the responding materials.

The applicant corporation sought court approval of a plan of arrangement under s. 182 of the Ontario Business Corporations Act involving the acquisition of its shares by another corporation.

Applying the framework in BCE Inc. v. 1976 Debentureholders, the court considered whether statutory procedures were followed, whether the application was brought in good faith, and whether the arrangement was fair and reasonable.

The court concluded that the arrangement had a valid business purpose, had been approved overwhelmingly by shareholders, and provided a significant premium to shareholders.

The court declined to rely on a fairness opinion contained in the management proxy circular because it constituted opinion evidence that failed to meet the admissibility requirements under the Rules of Civil Procedure, as it did not disclose the analytical basis for the opinion.

The arrangement was nevertheless approved on the basis of other admissible evidence.

A commercial landlord sought relief against a tenant regarding the installation of an ATM machine in leased premises used as a fast food restaurant.

The landlord argued the ATM constituted an impermissible use under the lease because it effectively provided banking services and allowed access by non-customers.

The tenant argued the ATM facilitated cash transactions for customers and reduced payment processing costs.

The court held that the ATM did not alter the permitted use of the premises as a fast food restaurant and did not constitute the offering of banking services.

The application was dismissed.

The defendant sought leave to appeal an order dismissing its motion for partial summary judgment.

The motion judge had found a genuine issue for trial regarding whether the plaintiff's claim for unpaid bonuses was statute-barred, applying the discoverability principles under the Limitations Act, 2002.

The Divisional Court dismissed the motion for leave to appeal, finding no conflicting decisions and no good reason to doubt the correctness of the motion judge's decision, particularly given the fact-specific nature of the discoverability issue in the employment context.