David M. Brown

The plaintiff real estate agent sued the defendant for a commission under a listing agreement after introducing a purchaser.

The defendant cancelled the property sale and instead structured the transaction as a sale of shares by its parent company to the purchaser.

The plaintiff moved to amend its claim to add the parent company, plead an indirect sale and breach of good faith, and add an oppression claim under the Business Corporations Act.

The defendant moved to strike the claim for disclosing no reasonable cause of action.

The court granted the plaintiff's motion to amend and dismissed the defendant's motion to strike, finding that the proposed claims were tenable at law and not plain and obvious to fail.

Following an appeal that remitted the issue of the quantum of full indemnity costs back to the motion judge for reassessment, the court reviewed the applicant's bill of costs for $707,173.00.

The respondent challenged the costs on several grounds, including hourly rates, time spent, use of law clerks and students, and alleged over-lawyering.

The court rejected the respondent's critiques, finding the fees claimed were fair, reasonable, and proportionate to the complex estate litigation.

The court affirmed the original full indemnity costs award and awarded the applicant partial indemnity costs of $8,500 for the reassessment hearing.

The judgment debtors moved under s. 106 of the Courts of Justice Act to stay enforcement of a judgment and the scheduled sheriff’s auction of a residential property pursuant to a writ of seizure and sale.

They argued equitable considerations, including a potential future claim for overpayments under earlier share purchase agreements that might support a set‑off against the judgment.

The court held that a stay of execution of a final judgment is an extraordinary remedy exercised only in rare circumstances where enforcement would be oppressive, vexatious, or an abuse of process.

The proposed claim was speculative, likely statute‑barred, unrelated to the subject matter of the judgment, and raised only as a last‑minute attempt to delay enforcement.

The court concluded that enforcement was not oppressive and that a stay would instead cause injustice to the judgment creditors.

The applicant and respondent submitted proposals for the appointment of an interim receiver/manager of the respondent corporation pending a shareholder meeting.

The court approved the powers set out in the applicant's proposed order.

While both proposed firms were qualified, the court appointed Duff + Phelps over Deloitte & Touche to avoid any appearance of a lack of independence, given prior contact between a director of the respondent and a representative of Deloitte.

The applicants, who invested approximately $15 million in the respondent companies, sought the appointment of a receiver following defaults on loans and breaches of a forbearance agreement.

The respondents had agreed to the appointment of a monitor and provided consents to a receivership held in escrow, but subsequently failed to provide the monitor with unfettered access to financial records, delayed adding the monitor as a bank signatory, and made preferential payments to the principal's family members.

The court found that the respondents materially breached the forbearance agreement and side letter, making it just and convenient under section 101 of the Courts of Justice Act to appoint a receiver over all three respondent companies.

A shareholder applied under the Canada Business Corporations Act for orders directing the calling of a shareholder meeting, compelling corporate compliance with statutory disclosure and governance obligations, and restraining the remaining directors from transacting business.

The respondent corporation’s board had lost quorum, lacked resident Canadian directors, failed to hold required shareholder meetings, and had defaulted on continuous disclosure obligations under securities legislation.

The court found that extraordinary circumstances justified judicial intervention under s. 144 of the CBCA to call and supervise a shareholder meeting.

Compliance orders were also granted under s. 247 of the CBCA, and restrictions imposed on the remaining directors’ powers due to the absence of board quorum.

To preserve the company’s affairs pending the shareholder meeting, the court directed that a temporary receiver and manager be appointed.

The applicants, companies engaged in leasing motor vehicles and equipment, sought a declaration that the Bulk Sales Act did not apply to a proposed asset securitization financing transaction involving the periodic sale of leases and related equipment to a special purpose vehicle.

The transaction was designed to raise operational financing while the applicants continued operating their businesses.

The court examined the purpose and scope of the Bulk Sales Act and the definition of a "sale in bulk".

It held that the proposed transaction constituted an ordinary-course financing technique and did not amount to a sale of assets out of the usual course of business.

Accordingly, the Act did not apply to the transaction.

The applicants sought approval under the Companies’ Creditors Arrangement Act for a sale of substantially all of their assets following a court‑approved sales and investor solicitation process.

The court considered the statutory factors in s. 36 of the CCAA, including the fairness and reasonableness of the process, the role of the monitor, consultation with creditors, and the adequacy of the consideration.

A late competing bid was rejected to preserve the integrity of the court‑approved sales process.

The court also addressed priority issues involving a DIP lender, secured creditors, and potential claims to HST refunds under the Financial Administration Act.

The proposed transaction and distribution scheme were approved as fair and reasonable in the circumstances.

The appellant was convicted of importing cocaine after arriving at Pearson International Airport with cocaine dissolved in wine bottles.

On appeal, she argued the trial judge erred in instructing the jury on the knowledge requirement and in admitting opinion evidence from a border services inspector regarding her ticket purchase.

The Court of Appeal dismissed the first ground but allowed the appeal on the second ground, finding the inspector's testimony about cash payments and short-notice bookings was inadmissible, highly prejudicial opinion evidence.

The court declined to apply the curative proviso and ordered a new trial.

The applicants moved under the Companies' Creditors Arrangement Act for an extension of the stay of proceedings until June 6, 2012.

A successful bid had been selected following a sale and investor solicitation process, and the extension was required to finalize the purchase agreement and seek court approval.

The court found that the applicants had acted in good faith and with due diligence, and granted the extension as the applicants had sufficient interim financing to proceed.

The applicant bank paid funds into court following the demise of a payroll processing company.

The company had mistakenly overpaid the Canada Revenue Agency, leading to a shortfall in its mixed trust accounts.

The court had to determine whether the remaining interpleaded funds should be distributed to claimants on a pro rata basis or by tracing specific funds to specific claimants.

The court held that the funds were held in a mixed trust account and, applying the pari passu ex post facto pro rata approach, ordered the funds to be distributed pro rata among all claimants.

In the context of a corporate liquidation, the court heard a scheduling appointment regarding the Liquidator's First Report.

Various parties sought directions on responding to the report, accessing corporate records, and obtaining documentary production.

The court established a timetable for responding materials and granted certain parties access to the company's records, subject to a strict 'pay as you play' cost deposit regime to prevent fishing expeditions.

Requests for production from the bankrupt applicant were directed to his bankruptcy trustee.

The applicant shareholders sought an oppression remedy and a court-ordered shareholder meeting, arguing that the company's Special Quorum Requirement for electing directors was invalid and oppressive.

The requirement mandated a 50% quorum, which had not been met for 15 years, preventing the election of directors.

The court dismissed the application, finding that the board complied with its legal obligations, the quorum requirement was publicly known and approved by shareholders, and the applicants had not attempted to use statutory tools like requisitioning a meeting or soliciting dissident proxies.

The court declined to order a meeting under s. 106 of the OBCA, as it was not impracticable for the shareholders to call one themselves.

A first‑time bankrupt applied for a discharge under the Bankruptcy and Insolvency Act after assigning himself into bankruptcy following a drunk‑driving incident in which his vehicle crashed into a residence.

Several unsecured creditors who owned the damaged home opposed the discharge while the trustee did not.

The court found that the bankrupt’s insolvency arose directly from his own voluntary intoxicated driving and therefore engaged s. 173(1)(a) of the BIA.

Because the civil action for damages arising from the incident had not yet proceeded to judgment, the court held it could not determine an appropriate conditional discharge.

The application for discharge was adjourned until the civil action was resolved so the court could assess appropriate conditions.

In CCAA restructuring proceedings, the applicants sought court approval to increase a debtor-in-possession (DIP) lending facility and to implement a Sale and Investor Solicitation Process (SISP).

The court considered the factors under s. 11.2(4) of the Companies’ Creditors Arrangement Act and approved an increase of the DIP facility to $6 million, noting the monitor’s support and the absence of opposition from secured creditors.

The proposed SISP included an expedited timeline, applicant-led solicitation of bids, and a stalking horse credit bid by the DIP lender.

The court held that the process was fair, transparent, and commercially reasonable given the applicants’ liquidity crisis and prior marketing efforts.

The SISP was approved as likely to maximize stakeholder value by facilitating either a going-concern sale or new investment.

A secured creditor applied under the Bankruptcy and Insolvency Act and the Courts of Justice Act for the appointment of a receiver and approval of a “quick flip” sale of the debtor’s assets to a related purchaser.

The secured creditor, debtor, and purchaser shared common ownership.

The court held that the evidentiary record was insufficient to justify the appointment of a receiver or approval of the proposed sale, particularly given the related‑party nature of the transaction and the timing of the security granted while the debtor appeared insolvent.

The court found inadequate evidence concerning the validity of the security, the fairness of the sale process, and the valuation of the assets.

In the absence of evidence demonstrating that a court‑appointed receiver was necessary or that the proposed transaction was fair to stakeholders, the application was dismissed without prejudice to re‑apply on better evidence.

In a Commercial List proceeding between franchisees and a franchisor, the defendant sought to schedule a post‑discovery partial summary judgment motion while the plaintiffs proposed proceeding directly to trial.

The court addressed the growing practice of lengthy summary judgment motions brought after discoveries and emphasized the need to consider proportionality, efficient use of judicial resources, and whether such motions would advance the interests of justice.

The court held that parties seeking to schedule lengthy post‑discovery summary judgment motions must demonstrate that the benefits outweigh the risk of added cost and delay if the motion fails.

Detailed information regarding the proposed motion, anticipated trial, and potential time savings must be provided to assist the court in making that determination.

The scheduling appointment was adjourned and directions were issued requiring the parties to file structured information before a further attendance.

In Companies’ Creditors Arrangement Act restructuring proceedings, the applicants sought an extension of the stay of proceedings and an increase to the debtor-in-possession lending facility.

The court considered the applicants’ liquidity position, workforce reductions, revised cash-flow forecasts, and the monitor’s report supporting the request.

The court found the applicants had acted in good faith and with due diligence and that extending the stay would permit implementation of an expedited sale and investor solicitation process aimed at preserving the business as a going concern.

The court approved an increase of the DIP facility to $5.35 million and amendments to the loan agreement, but declined to include $650,000 in accrued lender fees within the facility at that stage due to insufficient review.

The stay of proceedings was extended to allow the restructuring process to continue.

MasterCard brought a motion to stay an Ontario action commenced by Aldo Group Inc., arguing that a forum selection clause in its license agreements with acquiring banks required the dispute to be heard in New York.

Aldo, a merchant, was not a party to those agreements but had a processing agreement with Moneris that specified Ontario as the exclusive jurisdiction.

The court found that Aldo's claims against MasterCard were direct claims in tort and unjust enrichment, not claims of equitable subrogation.

Therefore, Aldo was not bound by the New York forum selection clause.

The motion for a stay was dismissed.

In CCAA restructuring proceedings, the applicants sought an extension of the stay of proceedings, an increase in debtor-in-possession financing, amendments to a key employee retention plan, and a sealing order.

The court considered the applicants’ efforts to secure additional interim financing and their progress toward a potential long-term supply contract that could enable further investment or restructuring.

Applying the statutory factors under the Companies’ Creditors Arrangement Act, the court approved an increase in the DIP lending facility and granted the requested stay extension.

The court also approved a minor salary reallocation to retain essential non-management employees and ordered that confidential employee-related schedules be sealed.