Darrell N. Hawreliak

The appellant, Medcap Real Estate Holdings Inc., appealed the dismissal of its motions to stay or dismiss actions brought by Bennington Financial Corp. and Heffner Investments Limited.

Medcap argued that the respondents breached the immediate disclosure rule by failing to disclose a verbal agreement requiring any settlement with Medcap to include all creditors.

The Court of Appeal affirmed the motion judge's finding that the agreement did not need to be disclosed as it did not fundamentally alter the litigation landscape or the adversarial relationship between the parties.

The appeals were dismissed, and costs were awarded to the respondents.

The defendant, Medcap Real Estate Holdings Inc., brought motions to dismiss or stay actions by Bennington Financial Corp. and Heffner Investments Limited.

Medcap alleged that the plaintiffs, along with other non-parties, entered into an undisclosed agreement to only settle collectively, which Medcap argued constituted an abuse of process requiring immediate disclosure.

The court found that such a verbal "settle with one, settle with all" agreement existed.

However, the court determined that this agreement was not required to be disclosed because it did not "entirely change the landscape of the litigation in a way that significantly altered the adversarial relationship among the parties or the dynamics of the litigation," as the plaintiffs were already aligned in interest through prior agreements and conduct.

Consequently, Medcap's motions were dismissed.

The plaintiff, Heffner Investments Limited (HIL), brought a motion for summary judgment seeking repayment of a $2.5 million debt secured by a promissory note and a second mortgage.

The defendant, Medcap Real Estate Holdings Inc. (Medcap), argued that the alleged $2.5 million debt was a sham, part of a single $2.1 million loan that had already been repaid, and that the plaintiff had breached an agreement to assist with refinancing.

The court found significant factual disputes and credibility issues between the parties regarding the nature and origin of the debt, the terms of their agreement, and the plaintiff's alleged breach.

Concluding that these issues could not be fairly resolved without a full trial, the court dismissed the plaintiff's motion for summary judgment.

The plaintiffs brought actions for breach of contract and breach of trust after the defendant general contractor abandoned a construction project.

The defendants were noted in default.

The court found the corporate defendant liable for breach of contract and breach of trust for failing to pay subcontractors.

The sole director of the corporate defendant was found personally liable for the breach of trust under the Construction Lien Act.

The court awarded compensatory damages but declined to award punitive damages or substantial indemnity costs.