David Keith

The applicant brought a motion to disqualify the respondents' counsel, Lockyer + Hein LLP, on the basis of a conflict of interest.

The law firm had previously represented the applicant in related litigation concerning the governance of a not-for-profit corporation.

The court found that the current application was sufficiently related to the prior matters, that there was a realistic possibility the law firm possessed relevant confidential information, and that acting against the former client breached the duty of loyalty.

The motion to disqualify counsel was granted.

The applicants brought a motion seeking a finding of contempt against former directors of a religious corporation who continued to act as directors and authorized significant payments after a consent court order replaced them.

The court found the respondents knowingly acted contrary to the order by signing cheques and authorizing approximately $135,000 in corporate disbursements after they were no longer directors, including payments after an additional order expressly prohibiting removal of funds.

Applying the established three-part test for civil contempt, the court held the order was clear, the conduct deliberate, and the breach proven beyond a reasonable doubt.

The court declined to order repayment of the funds due to practical enforcement and litigation considerations but imposed penalties and costs.