Benjamin Frydenberg

A lender brought a motion for summary judgment dismissing claims by a shareholder who sought to set aside corporate loan liability and attribute responsibility to co‑shareholders.

The court held that the shareholder provided no responding evidence and therefore failed to meet the requirement under Rule 20 of the Rules of Civil Procedure to put forward evidence on a summary judgment motion.

The court further found the shareholder lacked standing to challenge the corporation’s indebtedness because the claim belonged to the corporation and no derivative action had been authorized under the Ontario Business Corporations Act.

In any event, the lender was entitled to rely on corporate resolutions and an officer’s certificate under the indoor management rule confirming authority to borrow and grant security.

The action against the lender was dismissed.

In a supplementary endorsement following an earlier decision, the court addressed an outstanding request by the plaintiff lender for possession of the corporate defendant’s assets pursuant to a General Security Agreement.

The court granted the request and ordered possession of the corporation’s assets, property, and undertaking.

The endorsement also clarified the commencement date and statutory basis for pre‑judgment interest under the Courts of Justice Act, confirming it would run from the date pleaded in the statement of claim.

The plaintiff was further entitled to post‑judgment interest in accordance with the statute.

The appellant creditor brought an application for a bankruptcy order against the respondent debtor.

The application judge dismissed the application, finding the appellant failed to establish at least $1,000 of unsecured debt because its estimate of the security's value was absurdly low.

On appeal, the Court of Appeal held that the relevant date for valuing the security is the date of the application.

At that time, the appellant's mortgage ranked behind a Canada Revenue Agency super priority claim for unpaid GST, leaving the appellant with over $100,000 in unsecured debt.

The appeal was allowed and the bankruptcy application was granted.

The appellants appealed a trial judgment finding the individual appellant personally bound by a contract and denying credit for the residual value of used equipment.

The Court of Appeal dismissed the appeal, holding that the trial judge properly relied on handwritten entries and signatures rather than pre-printed clauses, making the doctrine of contra proferentem inapplicable.

The Court also found no error in denying credit for the equipment, as unchallenged evidence indicated it had no market value.

The appellant appealed a summary judgment granted against her regarding a mortgage she executed.

She argued the motion judge improperly determined credibility issues and shifted the burden of proof when rejecting her defences of misrepresentation, non est factum, lack of independent legal advice, and improvident sale.

The Court of Appeal dismissed the appeal, finding the motion judge correctly applied the test for summary judgment and properly concluded the appellant's bald assertions and lack of evidence failed to raise a genuine issue for trial.

The appellant's wife forged a power of attorney in his name to obtain mortgages from the respondents to pay off gambling debts.

The appellant, who was unaware of the fraud, argued the mortgages were void.

The motion judge granted summary judgment to the respondent mortgagees, finding the mortgages valid under the Land Titles Act.

The Court of Appeal dismissed the appeal, holding that under sections 78(4) and 155 of the Land Titles Act, the mortgages, having been given for valuable consideration and without notice of the fraud, were effective once registered.

The appellants appealed a decision dismissing their action for delay.

The Court of Appeal found that the motion judge correctly stated the applicable principles and reasonably concluded that the delay was inordinate, raising a presumption of prejudice.

As the appellants provided no evidence to explain the delay, the Court of Appeal found no basis to disturb the motion judge's findings and dismissed the appeal with costs.

The appellant appealed a judgment of the Superior Court of Justice in a bankruptcy matter.

The Court of Appeal dismissed the appeal, noting that the result followed the disposition of a companion action appeal (C43482) which had also been dismissed.

The appellants appealed a decision approving a receiver's recommended settlement.

They argued the motions judge failed to properly apply the principles from Crown Trust v. Rosenberg.

The Court of Appeal dismissed the appeal, finding the motions judge appropriately applied the Soundair principles, considered the differences between expert reports, and made no palpable and overriding error.

The appellants appealed a summary judgment enforcing a guarantee in favour of the respondent bank.

The Court of Appeal dismissed the appeal, agreeing with the motion judge that the defence of misrepresentation was defeated by the strict terms of the guarantee.

The Court also rejected the appellants' other defences, including an alleged promise not to sue, failure to fully advance a loan, misapplication of funds, and improper approval of the sale of business assets.

The Court of Appeal for Ontario issued a costs endorsement following an appeal in a bankruptcy proceeding.

After receiving submissions from the parties, the court fixed costs in favour of the respondent trustee in bankruptcy at $10,000 and in favour of the respondent creditor at $2,000, both inclusive of disbursements and GST.

The appellants appealed an order settling a prior order that approved the sale of a bankrupt company's assets, including a trademark licence agreement and shares, to Stanfield's Limited, as well as a vesting order.

The appellants argued the sale should not have been approved prior to determining entitlement to the interest in the licence agreement.

The Court of Appeal dismissed the appeal, finding the motion judge had jurisdiction under Rule 45 of the Rules of Civil Procedure to order the sale prior to determining entitlement, especially given evidence that the value of the licence agreement was deteriorating.

The dismissal of the appellants' cross-motion for an adjournment was also upheld.

The appellant bank appealed a forfeiture order over a U.S. dollar account used in connection with a fraudulent telemarketing gemstone scheme.

The court held that the fraudster's interest in victim funds was voidable, not void ab initio, so the bank's security interest could attach and constituted a valid interest under s. 462.41 of the Criminal Code.

The sentencing judge erred by treating the proceeds of crime as incapable of being given as security and by failing to consider the discretionary relief available to an innocent secured creditor.

On appeal, the court exercised that discretion only in part, ordering forfeiture of the identifiable proceeds of six victims and return of the remaining balance to the bank.

The appellant challenged a Commercial List order refusing an adjournment and dismissing its appeal from the disallowance of a proof of claim in a winding-up proceeding for want of prosecution.

The Court of Appeal held that the motion judge was aware of the full context, including the appellant's prolonged inaction, failure to file responding materials, and failure to explain either the asserted conflict with counsel or the delay.

The court rejected the appellant's procedural fairness argument and found no error in the exercise of discretion.

The appeal was dismissed with costs.