Brian D. Belmont

This is a costs decision in an estate administration dispute between two co-estate trustees.

The applicant sought costs of approximately $125,933 on a substantial indemnity basis (or $87,728 on a partial indemnity basis) following a successful application to compel the respondent to sign documents necessary for estate administration.

The respondent argued the application was unnecessary and that all parties should bear their own costs.

The court awarded costs of $16,000 all-inclusive on a partial indemnity basis, finding that while the applicant acted reasonably in bringing the application, the claimed costs were disproportionate to the modest estate value and the applicant's own conduct in refusing to fund estate counsel contributed to the escalation of legal expenses.

The appellants appealed an order for summary judgment in a mortgage action.

The respondents on appeal moved for an order dismissing the appeal based on the appellants' failure to satisfy a prior court order to pay outstanding costs totaling $46,280.

The Court of Appeal dismissed the appeal, finding that the appellants had not complied with the previous order and that their arguments against dismissal, including claims of unfairness and inability to pay, lacked merit.

This addendum was issued by the Court of Appeal for Ontario to clarify the total outstanding costs owed by the responding parties to the moving parties, Harsha Rathod and Bluekat Capital Corp. It consolidates costs orders from previous decisions by Roberts J.A. and a three-judge panel, specifying the combined amounts due to each moving party.

This motion was brought by the moving parties seeking to dismiss the responding parties' appeal due to unpaid costs orders, or alternatively, to compel payment of these orders by a deadline, or to require further security for costs.

The court, presided over by a single judge, determined it lacked jurisdiction to dismiss the appeal.

However, it ordered the responding parties to pay the outstanding costs orders by August 28, 2024, clarifying that costs orders are generally payable within 30 days even if no specific deadline is stated.

The appeal is scheduled to be heard on September 24, 2024, regardless of any further motion to dismiss.

Ijeoma Chijindu moved to set aside an order from Justice Lois B. Roberts that required her and other appellants to post security for costs of $35,605.12.

The motion judge had found that the criteria for security for costs under r. 61.06(1)(a) and (c) of the Rules of Civil Procedure were met, noting the appellants' inability to pay and the low prospect of success of their appeal.

The Court of Appeal dismissed Ms. Chijindu's motion, finding no error in the motion judge's determination and upholding the order for security for costs.

The appellants were ordered to pay all-inclusive costs to the respondents.

The applicant, a co-beneficiary and registered owner of an estate property, sought exclusive possession and termination of the respondent's occupancy, who had been living rent-free for 20 years.

The respondent, another beneficiary, resisted vacating, citing a purported wish of the deceased mother and claiming significant renovation expenses.

The court, noting the respondent's history of delays and non-compliance with previous orders, granted the applicant exclusive possession and an order for the respondent to vacate within 30 or 60 days, contingent on payment of outstanding costs.

The property is to be sold, and proceeds will be subject to a mutual accounting.

The moving parties sought security for costs of an appeal arising from mortgage disputes.

The responding parties (appellants) had defaulted on mortgages, and proceeds from power of sale were paid into court.

The motion judge ordered payment of these funds to the moving parties, which the responding parties appealed.

The Court of Appeal granted security for costs under Rule 61.06(1)(a) and (c), finding the appeal frivolous and vexatious with a low prospect of success, and that the appellants had insufficient assets or would be difficult to collect from.

The plaintiff and a defendant mortgagee brought a motion for summary judgment and distribution of sale proceeds paid into court following the sale of two properties by power of sale.

The court found that the defendant owners had engaged in fraudulent conduct, including registering sham mortgages and fraudulently discharging a valid mortgage, to defeat creditors.

The court granted summary judgment, reinstated the fraudulently discharged mortgage, and ordered the distribution of the sale proceeds to the valid mortgagees, including their legal costs on a complete indemnity basis.

The plaintiffs brought an action seeking a "corporate divorce" and remedies for oppression under s. 248 of the Business Corporations Act against the defendant, a 50% shareholder and director of the corporate plaintiff.

The defendant had abandoned his role in the business but continued to make unauthorized withdrawals from the corporate accounts for personal expenses, while also failing to pay personal taxes which resulted in CRA demands against the corporation.

The court found the defendant's conduct to be oppressive and ordered the corporation to purchase his shares for cancellation.

The court valued the defendant's 50% interest at $217,500 based on a current valuation without a minority discount, and deducted $50,000 for specific unauthorized withdrawals and tax payments made on his behalf, resulting in a final buyout price of $167,500.

The court also dismissed the defendant's late request to amend his pleadings to raise a limitations defence due to prejudice to the plaintiffs.

The appellants, directing minds and associates of two insolvent construction companies, orchestrated a false invoicing scheme to siphon tens of millions of dollars from the debtors.

The monitor and trustee sought to recover the funds as transfers at undervalue under s. 96 of the Bankruptcy and Insolvency Act.

The appellants argued that the companies were financially healthy at the time of the transfers, and that the directing mind's fraudulent intent could not be attributed to the companies under the common law corporate attribution doctrine.

The Court of Appeal dismissed the appeals, holding that the corporate attribution doctrine should be applied flexibly in the bankruptcy context to impute the directing mind's fraudulent intent to the debtor corporations.

This purposive approach prevents fraudsters from benefiting at the expense of legitimate creditors and fulfills the remedial objectives of the bankruptcy legislation.

The moving party sought leave to appeal the order of O'Connell J. dated July 30, 2021.

The Divisional Court dismissed the motion for leave to appeal and awarded costs of $2,500 to the responding party.

The Monitor of Bondfield Construction Company Limited and the Trustee in Bankruptcy of Forma-Con Construction brought applications under s. 96 of the Bankruptcy and Insolvency Act to recover tens of millions of dollars transferred out of the debtor companies through a false invoicing scheme and an alleged fund cycling scheme.

The court found that the payments made under the false invoicing scheme were transfers at undervalue made with the intent to defraud, defeat, or delay creditors, and held the participating respondents jointly and severally liable.

The court declined to apply the strict corporate attribution doctrine from Canadian Dredge, instead imputing the directing mind's fraudulent intent to the corporate debtors to fulfill the remedial purpose of s. 96.

The Monitor's claim regarding the fund cycling scheme was dismissed for lack of evidence that the transfers lacked consideration.

The plaintiff sought leave to amend its statement of claim to correct misnomers and substitute "Doe" defendants with named individuals, alleging fraud and misappropriation.

The motion was unopposed for five proposed defendants and granted.

For the five vigorously opposed proposed defendants, the court applied Rules 5.04 and 26.01, considering prejudice and the "litigating finger" test.

The court found that the claims against Parray and Khanlarov were too vague and outside the relevant time period, and against Kovalov, the "litigating finger" was not sufficiently pointed, and potential prejudice was noted.

Therefore, the motion to substitute Parray, Khanlarov, and Kovalov was dismissed.

However, the motion to substitute Halatullah and Kolesnik was granted, as the claims against them were sufficiently particularized or their first name matched a "Doe" defendant, and any prejudice was deemed inherent to litigation.

The respondent in an appeal sought costs under Rule 37.09, arguing that the appellants had abandoned their motion for a stay pending appeal.

The appellants' representative had stated in multiple emails that the motion was withdrawn, but no formal notice of abandonment was ever served or filed.

The court held that stating an intention to abandon a motion, or even claiming it has been abandoned, does not constitute abandonment under Rule 37.09(1) without serving and filing a formal notice.

The court found the motion was not abandoned and reserved the costs of this motion to the court hearing the stay motion.

Following a judgment declaring a mortgage registered by the respondents to be fraudulent, the applicant sought costs on a substantial indemnity basis.

The court applied the principle of reasonableness and considered an offer to settle made by the applicant.

Finding that the applicant obtained a judgment as favourable as the offer, the court awarded partial indemnity costs up to the date of the offer and substantial indemnity costs thereafter, fixing the total costs award at $20,000.

The applicant lender sought a declaration that a prior mortgage registered on the respondents' property was a fraudulent sham designed to defeat its security interest.

The respondent lawyer, who acted for both the borrowers and the applicant, registered multiple mortgages on the property, including one to a corporation controlled by his sister, without disclosing them to the applicant.

The court found the prior mortgage was a sham unsupported by any advancement of funds and ordered the land register rectified to delete the fraudulent charge under the Land Titles Act.

The defendant moved for an order setting aside his noting in default.

The court considered the factors for setting aside default, including the defendant's explanation for delay, the substantial value of the claim, and the lack of prejudice to the plaintiffs.

The motion was granted, and the noting in default was set aside on terms, allowing the defendant to file a statement of defence and setting timelines for document exchange.

The applicant sought to amend a previous judgment to correct the commencement date for prejudgment interest on a recognized Indian judgment.

The court granted the amendment, changing the interest start date from April 20, 2015, to April 8, 2013, as per the original Indian judgment.

The applicant, Corona Steel Industry Private Limited, sought substantial indemnity costs from the respondent, Integrity Worldwide Inc., following its successful application to recognize and enforce an Indian judgment.

Corona argued for substantial indemnity due to the respondent's litigation conduct and based on an offer to settle.

The court found no basis for substantial indemnity due to the respondent's conduct, as their actions were within their rights to challenge the application.

Furthermore, the offer to settle did not qualify for Rule 49.10(1) consequences because it had effectively expired before the hearing.

Consequently, the court awarded costs on a partial indemnity scale, reducing the claimed hours due to Corona's initial failure to provide evidence on Indian law, which caused an adjournment.

The applicant sought recognition and enforcement of a foreign judgment obtained in India against the respondent for unpaid goods.

The respondent opposed, arguing the expert evidence on Indian law was inadmissible due to bias, the Indian court lacked jurisdiction, the claim was statute-barred, and there was a denial of natural justice.

The court admitted the expert evidence, found a real and substantial connection to India, held the limitation period did not begin until the foreign appeal period expired, and found no denial of natural justice.

The application was granted and the Indian judgment was recognized.