Catherine Francis

The applicant judgment creditor sought to enforce a foreign arbitral award by garnishing embassy-related bank accounts in Canada.

The court held that customary international law governs immunity over embassy bank accounts through a restrictive immunity framework requiring proof of diplomatic relations, assurances of diplomatic purpose, and an opportunity for the creditor to rebut immunity by proving a commercial or other non-diplomatic use.

A Foreign Relations Certificate from the Minister of Foreign Affairs was conclusive only as to the existence of diplomatic relations between the states.

It did not confer absolute immunity or bar further inquiry into whether the accounts fell within an exception.

In bankruptcy proceedings arising from non-payment under a promissory note tied to the sale of a New York condominium, the court interpreted the note's limited recourse clause as capping recovery at one-third of sale proceeds rather than restricting recourse solely to identifiable sale proceeds in specie.

On that interpretation, the creditor remained an unsecured creditor after the debtor received the sale proceeds and therefore had standing to pursue a bankruptcy order.

The creditor's motion for a Rule 39.03 examination was dismissed because no further factual inquiry was necessary to answer the debtor's legal motion.

The debtor's motion to dismiss or strike the bankruptcy application was also dismissed, and the application was adjourned by agreement pending further materials and cross-examinations.

The landlord appealed a decision declaring its Notice to Vacate void and granting a permanent injunction restraining it from re-entering the leased premises.

The landlord sought to demolish the building and argued the lease limited the tenant's remedies to damages.

The Court of Appeal dismissed the appeal, finding the limitation clause did not apply to the landlord's arbitrary repudiation and trespass, and upheld the permanent injunction as an appropriate remedy to protect the tenant's property rights.

At a contempt sanction hearing arising from bankruptcy and fraudulent conveyance proceedings, the Trustee sought leave to withdraw the motion for further incarceration after obtaining new information that undermined the bona fides of the creditor applicants' underlying claims and disclosure.

The court held that only the Trustee had standing to enforce the contempt order within the fraudulent conveyance action, and that leave was required because contempt at the sanction stage is a matter between the court and the contemnor.

Applying the full and frank disclosure obligation governing ex parte relief, the court found material non-disclosure in obtaining the Mareva and Anton Piller orders and rescinded those orders.

Although the respondent debtor had not fully purged contempt, further incarceration was not warranted; the motion was withdrawn, Christina Chiang was found to have purged her contempt, and costs were awarded to the Trustee and Christina Chiang against the creditor applicants.

The appellant, Korea Data Systems (USA), Inc., was successful on a complex motion heard by the Court of Appeal for Ontario.

The court awarded the appellant costs fixed at $25,000, inclusive of disbursements and taxes, to be paid jointly by the Trustee and Christina Chiang.

The moving party condominium corporation brought a motion to quash an appeal of an application judge's order appointing an arbitrator.

The responding parties sought to appeal the appointment, arguing the application judge erred in referring all issues to the arbitrator without assessing their arbitrability.

The Court of Appeal quashed the appeal, holding that section 10(2) of the Arbitration Act, 1991 explicitly precludes any appeal from a court's appointment of an arbitral tribunal.

The plaintiff sought to appeal a costs order arising from a fraudulent conveyance action.

The motion judge had ordered the plaintiff to pay the defendant's costs and refused to allow a set-off for the amount the defendant owed the plaintiff.

The defendant argued leave to appeal was required under s. 133(b) of the Courts of Justice Act.

The Court of Appeal held that leave was not required because the refusal of a set-off had a substantive effect on the plaintiff's legal rights, extending beyond mere entitlement to and quantum of costs.

The court also declined to order security for costs and directed that the costs appeal be heard with the main appeal.

In advance of a scheduled sanction hearing for contempt findings, the trustee in bankruptcy and two contemnors moved for broad production of documents arising from related litigation in California involving the respondent corporation.

The moving parties sought depositions, financial statements, and additional litigation materials, arguing the information was relevant to their ability to answer or mitigate prior contempt findings and the sanctions to be imposed.

The court applied the relevance standard previously articulated for the sanction hearing and declined to grant a sweeping production order that would effectively retry the foreign proceedings.

Limited production was ordered, including five deposition transcripts of a key corporate officer and financial statements of the respondent corporation.

Requests for additional documents concerning alleged “straw sale” transactions were refused.

Following an earlier decision granting an injunction restraining a landlord from terminating a commercial lease without cause, the successful tenant sought elevated costs on a full or substantial indemnity basis, alleging the landlord acted in bad faith.

The court held that the prior reference to “bad faith” concerned contractual conduct and did not amount to litigation misconduct warranting punitive costs.

Finding no unusual circumstances to depart from the ordinary rule that costs follow the event on a partial indemnity basis, the court declined to increase the costs award.

Because the applicant’s submissions seeking punitive costs lacked reasonable basis and caused unnecessary costs proceedings, the court reduced the amount payable by awarding the respondent costs of the costs process.

Following the dismissal of appeals and motions for leave to appeal regarding the appointment of a trustee for an inter vivos trust, the successful parties sought their costs.

The Court of Appeal determined that the normal loser-pays regime applied to the appeals, rather than costs being paid out of the estate, as the uncertainty regarding the trust's administration had been resolved by the application judge.

The court awarded partial indemnity costs to the successful beneficiaries and full indemnity costs to the trustee, payable jointly and severally by the appellants.

Following a fraudulent conveyance trial in which allegations of conspiracy and damages against a defendant were rejected, the successful defendant sought substantial indemnity costs.

Although the court had found the defendant assisted in attempts to hinder collection efforts, it declined to impose damages and granted no substantive relief against her.

The court held that her status as a contemnor did not bar a costs award, particularly given that the plaintiffs had pursued duplicative litigation contrary to earlier representations and had failed to prove damages.

Substantial indemnity costs were warranted due to unproven allegations of fraud and the breach of a prior representation to the court.

Costs of $665,990.96 were awarded jointly and severally against the opposing parties, with a solicitor’s lien recognized under the Bankruptcy and Insolvency Act.

The defendants, previously found in contempt of multiple court orders relating to bankruptcy and asset disclosure, sought an order requiring broad disclosure of documents from the plaintiffs for an upcoming contempt sanction hearing.

The court considered privilege claims over numerous documents, including solicitor‑client communications, settlement communications, and materials arising from joint retainers.

The court held that several documents were not protected or that privilege was displaced by competing public interests, including the integrity of ex parte orders and prior incarceration resulting from the proceedings.

Evidence suggesting potential fraud by related corporate actors and possible nondisclosure in earlier applications justified expanded disclosure.

The court ordered production of specified materials and directed that the corporate plaintiff produce all further relevant documents subject to a privilege schedule.

The Children's Lawyer and other appellants appealed a decision dismissing their application to appoint an independent trustee for an inter vivos spousal trust.

The appellants alleged that the respondents, who were directors of the corporation wholly owned by the trust, committed a breach of trust by declaring dividends in excess of net income.

The Court of Appeal dismissed the appeal, finding that the respondents' actions as directors were governed by the Business Corporations Act, not the trust agreement, and did not constitute a breach of trust.

The court also dismissed an application to admit fresh evidence and upheld the application judge's order that costs be paid out of the estate.

The applicant condominium corporation sought an order appointing an arbitrator pursuant to a Complex Reciprocal Agreement.

The respondents agreed on the choice of arbitrator but argued the matters at issue were outside the arbitrator's jurisdiction and that overlapping court proceedings precluded arbitration.

The court applied the competence-competence principle, holding that challenges to an arbitrator's jurisdiction should generally be resolved by the arbitrator first, unless based solely on a question of law or requiring only superficial consideration of documentary evidence.

Finding that at least one issue (allocation of common costs) arguably fell within the arbitrator's jurisdiction, the court granted the application and appointed the arbitrator.

The plaintiffs brought a motion seeking an order requiring a bank to restore funds removed from a frozen account after the bank allowed the freeze to lapse.

The plaintiffs relied on Rule 60.11(9) of the Rules of Civil Procedure and the court’s inherent jurisdiction to compel restoration of the account to its prior state.

The court held that the requested relief could not be granted on a summary motion because the bank was not a defendant in the action and issues such as duty of care, causation, and potential set-off would require a full civil proceeding.

The court concluded that the appropriate remedies would be a contempt motion or a separate action for damages.

The motion was therefore dismissed without prejudice to pursuing those remedies.

In a bankruptcy proceeding on the Commercial List, counsel alerted the court that its earlier endorsement had not addressed a specific tab in the Brief of Privileged Documents.

The court considered whether the materials contained in that tab were privileged.

Because the tab excerpted material from a settlement conference brief previously held to be privileged, the court confirmed that the tab itself was also privileged.

The endorsement was corrected by way of corrigendum to reflect that determination.

A motion arose in bankruptcy litigation concerning whether portions of a trustee’s report disclosed privileged communications from a prior joint retainer between the trustee and a creditor.

The creditor argued the materials were protected by solicitor‑client privilege, settlement privilege, and common interest privilege and sought to prevent their disclosure.

The court held that, in a dispute between former joint clients over removal of counsel, solicitor‑client privilege does not apply between the clients themselves, allowing the full record to be considered on that motion.

However, for the trustee’s broader motion for advice and directions involving third parties, several documents remained privileged because privilege jointly held by co‑clients cannot be unilaterally waived.

The court therefore ordered certain materials sealed for the removal motion but redacted from the public record for other proceedings.

Following litigation concerning the resignation of a trustee and the mechanism for appointing replacement trustees under a family trust, the court determined the issue of costs.

Competing groups of beneficiaries had disputed whether the court should appoint an institutional trustee or whether the mechanism set out in the testator’s will should govern.

Although one group succeeded on the substantive issue, the court held the cross-application seeking an independent trustee was reasonably necessary to ensure proper administration of the estate.

Applying Rule 57.01 of the Rules of Civil Procedure and the principles governing estate litigation costs, the court concluded that fairness and the importance of the issues justified payment of most parties’ costs from the estate.

The court fixed specific amounts payable to each party.

The appellant bank appealed a decision dismissing its action against a guarantor.

The guarantor had provided a continuing all accounts guarantee for a corporate loan, receiving independent legal advice.

The bank subsequently increased the loan amount without obtaining a new guarantee or notifying the guarantor.

The Court of Appeal allowed the appeal, finding that while the loan increases were material alterations, the clear language of the guarantee permitted the bank to increase the loan amount and change terms without discharging the guarantor.

The guarantor had contracted out of common law protections.

The applicant sought to resign as trustee of a family trust.

The Office of the Children's Lawyer brought a cross-application to appoint a new independent trustee, arguing that the settlor's children, who intended to appoint themselves as trustees pursuant to the trust agreement, had abused their discretion as directors of the trust's holding company.

The court found no evidence of abuse of discretion that would justify interfering under s. 5(1) of the Trustee Act, and held that the executors could appoint the next trustees pursuant to the trust agreement.