Bryan Calvin McPhadden

This decision provides supplementary reasons to correct a jurisprudential error in the interpretation of s. 96(1)(b)(ii) of the Bankruptcy and Insolvency Act.

The original reasons incorrectly required the trustee to prove both insolvency and fraudulent intent for non-arm's length transfers at undervalue made between one and five years prior to bankruptcy.

The correction clarifies that the statutory test is disjunctive, requiring proof of only one of these conditions.

The correction ensures the law is expressed correctly but does not alter the outcome of the original order, as the trustee had already proven both conditions.

The defendants, Bayer Inc., Bayer Pharma AG, and Bayer OY, brought a motion to formally stay a proposed national class action in Ontario, initiated by Kimberley Babin, in favour of ongoing national class actions in Alberta.

The plaintiff opposed the stay, seeking to revive the Ontario action after an informal stay.

The court granted the defendants' motion, finding that the plaintiff's consortium had chosen Alberta as the primary forum and should pursue the action there.

The court rejected the plaintiff's reasons for returning to Ontario, which included concerns about the pace of the Alberta action and the failure to serve foreign defendants in Alberta, characterizing such actions as forum shopping and an attempt to hedge procedural choices.

The court emphasized the importance of avoiding multiplicity of proceedings and judicial comity.

The trustee in bankruptcy sought costs following a successful decision against the respondents.

The trustee had made an offer to settle for $100,000, which remained open until the commencement of the hearing.

As the trustee beat its offer, the court applied Rule 49 and awarded the trustee partial indemnity costs up to the date of the offer and substantial indemnity costs thereafter.

The respondents were ordered to pay costs fixed at $15,356.99.

The trustee in bankruptcy moved for an order requiring a director and his company to pay $159,330 to the estate under s. 96 of the Bankruptcy and Insolvency Act, alleging a transfer at undervalue while the bankrupt was insolvent.

The court found that the bankrupt made payments to the company for no actual value, that the parties were not dealing at arm's length, and that the payments were made with an intent to defraud, defeat, or delay a creditor, as evidenced by badges of fraud.

The court granted the order, requiring the director and his company to pay the specified amount to the estate.

The plaintiffs brought a motion for certification of a class action against the manufacturers of Pradaxa, an anticoagulant drug.

The plaintiffs alleged that the defendants breached their duty to warn consumers and healthcare professionals about the lack of an antidote for the drug, which could lead to excessive bleeding.

The court dismissed the certification motion, finding that the plaintiffs failed to establish that the proposed common issues actually existed or could be answered in common across the class.

The court noted that the decision to prescribe an anticoagulant and the need for a reversal agent are highly patient-specific, and there was no basis in fact to conclude that the absence of an antidote posed a common and material risk across the class.

The defendants sought leave to appeal an order dismissing their motion to compel answers to questions refused during cross-examination on an affidavit.

The underlying action is a proposed class action regarding a birth control device, and the affidavit was filed in response to the defendants' motion to stay the Ontario proceeding.

The Divisional Court dismissed the motion for leave to appeal, finding that the issues regarding the refusals were specific to the stay motion and did not transcend the interests of the parties to involve matters of general or public importance.

This motion concerned the approval of a class action settlement and class counsel fees following a data breach at Home Depot.

The court approved the settlement, finding it fair and reasonable given the low likelihood of success for class members.

However, the court denied honoraria for representative plaintiffs and significantly reduced the requested class counsel fees from $406,800 to $120,000, emphasizing that fees must be proportionate to the actual benefit received by the class members, which was valued at approximately $400,000.

The defendants brought a refusals motion to compel the plaintiff's counsel, Mr. Tuovi, to answer questions during cross-examination on his affidavit.

The questions related to the internal workings, formation, and strategic decisions of a consortium of class counsel prosecuting multi-jurisdictional class actions against the defendants.

The court dismissed the motion, finding that the questions were irrelevant to the underlying motion to stay the Ontario action and that, even if raised in the affidavit, the court had discretion not to compel answers to irrelevant questions, particularly those delving into privileged internal communications of the consortium.

In a proposed pharmaceutical products liability class action concerning the anticoagulant drug Pradaxa®, the defendants sought production of additional medical records of the proposed representative plaintiffs prior to the certification motion.

The plaintiffs resisted, arguing certification is a procedural step and that extensive medical disclosure was unnecessary and intrusive at the pre‑certification stage.

The court held that the scope of pre‑certification disclosure depends on the nature of the particular class action and that, in a drug‑related products liability claim alleging serious adverse effects, more detailed medical evidence was relevant to the certification criteria.

The court concluded it was apparent from the pleadings that limited records confirming ingestion of the drug were insufficient.

Production of the requested medical records was therefore ordered.

Following a motion regarding the pre-certification production of medical records where the responding party (plaintiffs) was largely successful, the parties submitted costs submissions.

The plaintiffs sought $13,368 on a partial indemnity basis, while the defendants argued for costs in the cause or a maximum of $3,500.

The court found the plaintiffs were entitled to partial indemnity costs but reduced the claimed amount to comply with the Rules Committee's Grid for hourly rates and to account for excessive disbursement claims.

Recognizing the plaintiffs were largely but not entirely successful, the court fixed costs at $6,800 all-inclusive.

In a proposed pharmaceutical class proceeding alleging that anti-psychotic medications caused gynecomastia and that the defendants failed to warn of that risk, the moving defendants sought pre-certification production of broad medical and pharmacy records for five affiants.

The court held that pre-certification medical production must be limited to records bearing on certification issues and rejected any request that effectively sought entire medical files.

It confirmed production of records relating to prescriptions, ingestion, development of gynecomastia, related risk or warning discussions, and related surgeries.

The court refused on the present record to compel further diagnosis and treatment records aimed at individual causation or vague assertions about commonality and preferability, but left the issue open for renewal on cross-examination.

A law firm sought to replace existing carriage counsel in a proposed pharmaceutical class action on the basis of unreasonable delay in bringing a certification motion.

The court held that under s. 12 of the Class Proceedings Act, 1992 it has supervisory jurisdiction to entertain a carriage transfer motion.

The court established a four-part test requiring proof that the delay is clearly unreasonable, that it causes actual prejudice to class members, that the explanation for the delay is inadequate, and that compelling certification within a fixed timeline would be unworkable or not in the class’s best interests.

Applying this test, the moving party failed to demonstrate unreasonable delay or prejudice, and the explanation for the delay was credible.

The motion to replace carriage counsel was therefore dismissed.

The representative plaintiff in a certified class proceeding sought court approval of a settlement and approval of class counsel fees under the Class Proceedings Act, 1992 following a cyber‑attack on the defendants’ PlayStation Network and related online services that allegedly compromised personal information and interrupted access.

The settlement provided cash payments for unused account balances, online service benefits, and reimbursement of up to $2,500 for proven identity theft losses.

Notice of certification and settlement was distributed to millions of account holders and resulted in minimal opt-outs and no objections.

The court considered the applicable factors for settlement approval in class proceedings and concluded the agreement was fair, reasonable, and in the best interests of the class.

The requested class counsel fee of $265,000 was also approved as reasonable in light of the risk and work undertaken.

The defendant sought leave to appeal a decision certifying a multi-jurisdictional class proceeding regarding the prescription of CHAMPIX, a smoking cessation medication, and the subsequent $300,000 costs award.

The Divisional Court dismissed the motion, finding no conflicting decisions and no good reason to doubt the correctness of the certification decision.

The court held that the motions judge applied well-established legal principles and made no palpable and overriding error of fact or law.

The costs award was also upheld as there was no error in principle.

Following a certification motion in a proposed class proceeding concerning pharmaceutical product liability, the plaintiff sought partial indemnity costs after obtaining certification against one defendant but not the other.

The court considered Rule 57.01 of the Rules of Civil Procedure and the discretionary principles governing costs in class proceedings.

While the defendants argued the plaintiff’s claim should be substantially reduced due to partial success and limited certification of common issues, the court rejected most of these arguments.

However, because certification was not granted against one defendant, the court reduced the plaintiff’s claimed costs by approximately 20 percent.

Costs of $300,000 all-inclusive were awarded payable forthwith.

The plaintiff sought certification of a proposed national class action alleging that a prescription smoking‑cessation drug caused neuropsychiatric adverse events and that the manufacturer breached its duty to warn consumers and physicians.

The court considered the certification criteria under the Class Proceedings Act, 1992, including whether there was some basis in fact for the proposed common issues and whether a class proceeding was the preferable procedure.

The court held that there was some basis in fact for a duty to warn claim against the Canadian manufacturer based on expert and anecdotal evidence of adverse psychiatric events.

The proposed class definition and common issues were amended to focus on specific neuropsychiatric symptoms and the adequacy of product monograph warnings between 2007 and 2010.

The proceeding was certified against the Canadian manufacturer but not against the U.S. parent company, whose involvement lacked a factual basis.

In a proposed pharmaceutical products liability class action concerning alleged neuropsychiatric side effects of the smoking cessation drug Champix, the defendants brought a refusals motion seeking further production of medical and related records from proposed representative plaintiffs during cross‑examinations conducted for a certification motion.

The defendants argued the additional records were necessary to challenge whether there was some basis in fact for the proposed common issues and certification criteria.

The court accepted that the requested information had some relevance but held that the scope of cross‑examination on a certification motion is narrower than discovery and must comply with proportionality principles.

Given that the plaintiffs had already produced medical records and answered extensive questions, compelling further production would improperly extend the inquiry into the merits of the case and impose a disproportionate burden.

The motion to compel further answers and productions was therefore dismissed.

The appellant appealed the dismissal of his claim against the respondent solicitors.

The appellant had forwarded a bank draft to the solicitors for the purchase of shares in their client's company, but never received the shares.

He argued the solicitors owed him a duty of care to hold the funds in escrow.

The Divisional Court dismissed the appeal, upholding the trial judge's finding that there was no proximity or reliance sufficient to establish a duty of care, as the appellant had no contact with the solicitors and they did not undertake to protect his interests.

An ageing father gratuitously placed the bulk of his assets in joint accounts with his adult daughter.

Upon his death, the daughter claimed the balance through a right of survivorship, while her ex-husband claimed the assets formed part of the estate.

The Supreme Court of Canada held that the presumption of resulting trust applies to gratuitous transfers to adult children, limiting the presumption of advancement to minor children.

However, the Court found sufficient evidence that the father intended to gift the right of survivorship to his daughter, rebutting the presumption of resulting trust.

The appeal was dismissed.

The appellant, the deceased's son-in-law, appealed a trial decision that found the deceased intended to gift his investments to his daughter (the respondent) by placing them in joint ownership.

The appellant argued the investments should form part of the estate residue, of which he was a joint beneficiary.

The Court of Appeal dismissed the appeal, finding ample evidence that the deceased actually intended to gift the beneficial interest to his daughter, making it unnecessary to rely on the presumption of advancement or resulting trust.