Cory A. Gilmore

The court-appointed Liquidators of Days Hong Kong sought a Norwich Order against two Ontario corporations (Days Canada Limited and Days Holdings Limited) and their director, Scott McPhail (Third Parties), to obtain information for tracing assets and investigating potential fraudulent conveyances by Mahesh Dayaram, a convicted fraudster.

The Third Parties argued the Liquidators had sufficient information and the request was a fishing expedition.

The court granted the Norwich Order in part, finding the test for such an order was met due to the suspicious timing of share redemptions and property transfers, the need for asset tracing in a large-scale fraud, and the Liquidators' broad investigative powers under a Recognition Order.

The court also addressed the scope of indemnity for the Third Parties' costs of compliance.

The Jewish Foundation of Greater Toronto (Foundation) moved to dismiss or stay a bankruptcy application brought by The Joseph Lebovic Charitable Foundation (JLCF).

JLCF alleged the Foundation was indebted to it for over $15 million from a Donor Advised Fund (DAF) and had failed to meet its liabilities.

The court found no debtor/creditor relationship, as the funds were irrevocable gifts, not debts.

It also found no evidence the Foundation was unable to pay its debts, noting its excellent financial health.

The court determined that no act of bankruptcy occurred and that the JLCF's application, brought as a single creditor, lacked special circumstances.

The court further found the bankruptcy application to be an abuse of process, brought for the collateral purpose of pressuring the Foundation to distribute funds, rather than for a legitimate bankruptcy purpose.

The Foundation's motion to dismiss was granted, and the bankruptcy application was dismissed.

The Receiver sought advice and directions regarding a proof of claim by the Township of Augusta for outstanding property taxes against the former owner, 1902408 Ontario Ltd., and the current owner, 1217858 B.C. Ltd. The court determined that the Township's claim against the former owner was not proven, and that the supplemental taxes were vested out by the Approval and Vesting Order (AVO) issued during the receivership sale.

Alternatively, the Township was estopped from collecting taxes from the current owner due to prior assurances and a binding tax certificate.

The court dismissed the Township's claim against both parties.

The Crown brought a Rule 21 motion to strike various paragraphs and counterclaims from the Statements of Defence of Sanjay Madan, Shalini Madan, Chinmaya Madan, and Ujjawal Madan.

The Crown alleged that the pleadings contained untenable claims of contributory negligence, frivolous and vexatious allegations, and counterclaims that were not tenable in law, including claims of direct tort liability against the Crown and vicarious liability for intrusion upon seclusion.

The court granted the Crown's motion, finding that the defence of contributory negligence is not available for fraud, the Crown is immune from direct tort liability for systemic negligence, and no private law duty of care or vicarious liability for intrusion upon seclusion was established based on the facts pleaded.

The court also struck pleadings related to the Crown's conduct in the litigation as improper.

The Applicants, judgment creditors of the Respondents (Hutchens), brought a motion seeking a declaration that $2M mortgages registered by Adroit Advocates LLC against the Hutchens' Ontario properties were void ab initio.

The mortgages were registered shortly after a significant US judgment was rendered against the Hutchens for mortgage financing fraud.

The Applicants argued that the mortgages were intended to defeat creditors and were given for insufficient consideration.

Adroit, the responding non-party, challenged the Applicants' standing and asserted the mortgages were granted in good faith for good consideration.

The court found the Applicants had standing and, applying the Fraudulent Conveyances Act and the Assignments and Preferences Act, determined that the mortgages were intended to give Adroit an unjust preference over other creditors and were given for inadequate consideration, primarily consisting of future, unbilled legal fees.

The motion was granted, declaring the mortgages void and directing their discharge.

Erich Genseberger moved to annul the bankruptcy of Kate Alexander under s. 181(1) of the Bankruptcy and Insolvency Act, alleging insolvency was not met or that the assignment was an abuse of process due to her conduct in ongoing family law proceedings and asset dissipation.

The Trustee and other creditors opposed, arguing the Debtor was insolvent at the time of assignment and her past conduct, while problematic, did not constitute an abuse of process for annulment purposes.

The court dismissed the motion, finding the Debtor was insolvent at the time of assignment and her conduct, while frustrating, did not meet the high bar for abuse of process required for annulment.

The family law stay was lifted to allow the equalization claim to proceed, and the matrimonial home was ordered to be sold by the Trustee for the benefit of all creditors.

The applicant, Centerra Gold Inc., sought a permanent injunction against its former director, Tengiz Bolturuk, for breaching his fiduciary duties and duty of confidentiality.

Bolturuk, nominated by the Kyrgyz Republic's state-owned corporation, was found to have secretly orchestrated the takeover of Centerra's Kumtor gold mine by the Kyrgyz Republic while still a director, disclosing confidential information and subsequently becoming the External Manager of the seized mine.

The court found that Bolturuk's actions constituted a clear usurpation of corporate opportunity and a flagrant breach of his duties, rejecting his justifications.

The court affirmed its jurisdiction over a former director for breaches stemming from their position and found damages to be an inadequate remedy.

Bolturuk's cross-motion to set aside an interim injunction was dismissed.

The permanent injunction was granted, and substantial indemnity costs were awarded against Bolturuk.

The court issued a costs endorsement and corrigendum following the dismissal of the responding parties' motion for a certificate of pending litigation.

The court was informed of two unaccepted offers to settle made by one of the parties seeking costs.

The court also corrected an error regarding funds held as security for costs, clarifying they were solely for the benefit of one party.

The court increased the costs awarded to the party who made the offers to $22,500, finding the requested $35,000 disproportionate for a 1.5-hour motion.

A separate costs award of $7,500 was maintained for the other parties seeking costs.

The applicants, limited partners in a real estate development project, brought an application to compel the general partner to proceed to arbitration regarding the distribution of sale proceeds.

The respondents resisted, arguing that preliminary issues such as corporate authority and the enforceability of a release must be decided by the court first.

The court granted the application, ordering the parties to arbitration and holding that the broad arbitration clause and the competence-competence principle allowed the arbitrator to determine the preliminary issues.

The court also ordered that the sale proceeds remain in trust pending the arbitration.

The applicants, judgment creditors from US proceedings involving fraudulent lending schemes, brought a motion to declare certain trusts established by the respondents as invalid shams.

The receiver's investigation traced funds from the fraudulent schemes to the trust properties and identified numerous 'badges of fraud'.

The respondents failed to produce evidence refuting the receiver's findings.

The court applied the McGoey factors, found the trusts were a sham, and ordered the trust assets to be part of the receivership estate available to creditors.

The plaintiffs, minority shareholders of two companies that owned marinas, sought leave to bring a derivative action against the companies' solicitor regarding the distribution of proceeds from the sale of the marinas.

The plaintiffs alleged the solicitor improperly distributed the funds to the majority shareholder or companies controlled by him.

The court dismissed the motion, finding that while the plaintiffs met the first three parts of the test for a derivative action, they failed to demonstrate that the proposed action was in the best interests of the companies, as there was no evidence the companies suffered a loss and the plaintiffs' true claim was personal.

The applicants (Sellers) and respondents (Purchasers) disputed the process for valuing shares under a shareholders agreement following the termination of the Sellers' employment.

The Sellers applied to appoint their preferred arbitrator and argued for a full arbitration under the Arbitration Act, 1991.

The Purchasers cross-applied to appoint their preferred arbitrator, seeking a streamlined valuation process and a court declaration on the valuation date.

The court held that the agreement contemplated a formal arbitration under the Act, not merely a valuation.

The court declined to determine the valuation date, leaving it to the arbitrator under the competence-competence principle, and ordered the parties to select a neutral third-party arbitrator.

This is a costs endorsement following successful summary judgment motions by the defendants.

The court determined the scale and amount of costs payable by the plaintiffs to the defendants.

The defendants sought substantial indemnity costs based on their offers to settle, which proposed dismissal of the action without costs.

The court found that such offers, while relevant, do not automatically attract substantial indemnity costs, and awarded partial indemnity costs, considering factors like success, complexity, amounts at stake, and litigation conduct.

The plaintiff, acting as Estate Trustee, brought a motion for leave to issue a Certificate of Pending Litigation (CPL) against a property held by the deceased's sister.

The deceased and her sister had taken title as joint tenants following a refinancing arrangement, but the sister had not paid the agreed consideration.

After the deceased's death, the sister registered a survivorship application and further encumbered the property.

The court found that the transfer was gratuitous, raising a presumption of resulting trust, and that the Estate had met the threshold of demonstrating a triable issue regarding its interest in the property.

The motion was granted, and costs were awarded to the plaintiff.

The applicant challenged her late mother's 2015 Will, alleging lack of testamentary capacity, undue influence, and forgery by her sister, the respondent estate trustee.

The respondent moved for summary judgment to dismiss the will challenge, while the applicant moved to amend her Notice of Objection to add further allegations of financial impropriety and conspiracy.

The court granted summary judgment, finding no genuine issue for trial as the applicant's claims were uncorroborated and the drafting lawyer's evidence confirmed the testator's capacity and the absence of suspicious circumstances.

The applicant's motion to amend was dismissed as the proposed amendments lacked legal foundation and were highly prejudicial.

The respondents brought a motion to remove the applicant's counsel, alleging a conflict of interest because counsel acted for the applicant personally, as Estate Trustee, and for the Estate, and arguing counsel might become witnesses.

The court dismissed the motion, finding that counsel acts for the Estate Trustee, not the Estate, and there was no evidence of a conflict or that counsel would need to testify.

The court also ordered the respondents to provide outstanding disclosure, pay $15,000 in costs thrown away for a previously adjourned hearing, and directed that any proceeds from the sale of a disputed condominium be paid into court.

The plaintiffs, who held a right of first refusal (ROFR) over certain wind farm assets, sued the vendor and the third-party purchaser, alleging they conspired to artificially inflate the purchase price allocation of the ROFR assets to discourage the plaintiffs from exercising their rights.

The plaintiffs sought damages for breach of the duty of good faith, breach of fiduciary duty, conspiracy, and inducing breach of contract.

On cross-motions for summary judgment, the court dismissed the plaintiffs' claims, finding that the vendor acted in good faith and the purchaser was entitled to act in its own commercial self-interest.

The court held that a difference in valuation or a strategic bid allocation does not, without more, constitute a breach of the duty of good faith or an intent to eviscerate the ROFR.

The claimant and the bankrupt appealed two decisions of the Registrar in Bankruptcy that refused to extend the time for the claimant to appeal the Trustee's Notice of Disallowance of her claim to a beneficial interest in a property, and subsequently granted the Trustee's motion to sell the property.

The Superior Court found that the bankrupt had standing to appeal.

The Court held that the Registrar made palpable and overriding errors of fact in applying the test for an extension of time, specifically by ignoring evidence that the claimant formed an intention to appeal within the prescribed time and had a reasonable explanation for the delay.

The appeals were allowed, the Registrar's decisions were set aside, and the time to appeal the disallowance was extended.

The applicant mortgagee brought an application for declarations that a commercial mortgage registered against the respondent's property was a closed mortgage with no prepayment privilege, that it was entitled to all lost interest to maturity upon any early prepayment, and that forced insurance coverage costs were recoverable.

The respondent corporate mortgagor argued it should be entitled to pay out the mortgage upon a sale without paying interest to maturity.

The court granted the declarations, finding that the mortgage terms clearly prohibited early prepayment and that corporate borrowers do not have a statutory right to redeem a mortgage with only a three-month interest penalty under the Mortgages Act.

The court also found the insurance costs were properly recoverable under the mortgage terms.

The plaintiffs brought a motion for a preservation order regarding shares in a start-up company, alleging they owned two-thirds of the shares held by the defendant.

The defendant claimed sole ownership and had recently sold a portion of the shares.

The court found the plaintiffs met the test for a preservation order under Rule 45.

However, to mitigate prejudice from fluctuating share prices, the court ordered that the defendant could sell the shares but must pay the proceeds into court.