David M. Brown

A non-share corporation operating a mosque and community centre experienced an internal governance dispute among its members, leading to litigation.

After reviewing affidavit evidence and a monitor’s report, the court highlighted corporate governance errors committed by both sides under Canadian corporate law.

The court encouraged the parties to resolve the dispute without judicial determination.

The parties entered into Minutes of Settlement providing for an interim executive committee and future elections.

The court approved the settlement, the monitor’s report and activities, and the monitor’s fees.

The applicant, a 50% voting shareholder in a real estate development corporation, sought an order to wind up the corporation or force a buy-out under the oppression and just and equitable winding-up provisions of the OBCA.

He argued that the corporation was a partnership in corporate guise and that his reasonable expectation was to only deal with his original partner, not the partner's children.

The court dismissed the application, finding that the corporation's operations and the applicant's governance rights were not impaired, and that the evidence did not support the existence of the claimed reasonable expectation, especially since the applicant had previously consented to the children's involvement.

The plaintiff sought additional provisions to be included in a previously granted default judgment arising from a fraud action.

Specifically, the moving party requested language declaring that the judgment survived bankruptcy under s. 178 of the Bankruptcy and Insolvency Act and an order relieving it from making a separation payment under a termination agreement.

The court held that default judgment cannot grant relief not sought in the originating process or the notice of motion.

The court further held that whether a judgment survives bankruptcy discharge must be determined in proceedings under s. 178 of the BIA.

The requested additions were refused and the submitted order was amended accordingly.

The applicant corporation, undergoing liquidation, brought a motion for directions regarding the distribution of assets attributable to shareholders whose whereabouts were unknown.

The applicant proposed transferring the undistributed funds to a related cultural organization to hold in trust, or alternatively to the Public Guardian and Trustee.

The Public Guardian and Trustee opposed the proposal and argued that the funds should be delivered pursuant to s. 268(1) of the Corporations Act.

The court held that the statutory scheme under the Corporations Act operates as the default mechanism for handling distributions to unlocated shareholders and maximizes their opportunity to claim their entitlements.

The court directed that the funds be delivered to the Public Guardian and Trustee to be held in trust in accordance with the statutory provisions.

The respondents brought a motion to transfer a Commercial List application from Toronto to Kitchener.

The underlying dispute involved two shareholders disagreeing over the implementation of a Transition Agreement and the proposed removal of one shareholder as a director.

The court applied a holistic balancing of the factors under Rule 13.1.02(2) of the Rules of Civil Procedure.

Finding that the applicant resided and worked in Toronto, and that the Commercial List could accommodate the scheduling, the court concluded the respondents failed to demonstrate that Kitchener was a more desirable venue.

The motion was dismissed with costs awarded to the applicants.

The plaintiffs sought to continue a Rule 45.01 preservation order obtained ex parte preventing certain defendants from dealing with disputed shares in a start‑up internet gaming company.

The defendants argued that the order should be set aside because the plaintiffs failed to make full and frank disclosure when obtaining the original order.

The court reviewed the evidentiary record and found that the plaintiffs had materially failed to disclose key facts, including prior pleadings, relevant documents, and the full shareholders agreement, and had presented a misleading narrative regarding their knowledge of share allocations.

The omissions were material and undermined the integrity of the ex parte process.

The court exercised its discretion to dissolve the preservation order rather than continue it.

The plaintiffs, minority shareholders of EnGlobe Corp., brought an action alleging that EnGlobe and its CEO engaged in oppressive conduct and conspired with a third party to freeze their shares during a proxy fight.

The court dismissed the action, finding that the freezing of the shares resulted from a consent order in separate litigation, not from any oppressive conduct or conspiracy by EnGlobe.

The court also held that the claims were barred by cause of action estoppel due to a prior consent dismissal order, and that the oppression claim was statute-barred under the Limitations Act, 2002.

Application for a final order approving a corporate plan of arrangement under s. 182 of the Ontario Business Corporations Act.

The proposed transaction involved the acquisition of a steel manufacturer through an arrangement negotiated at arm’s length with an acquiring corporation and its subsidiary.

The court applied the governing principles from BCE Inc. v. 1976 Debentureholders, requiring that the arrangement constitute a valid statutory arrangement, comply with procedural requirements, be proposed in good faith, and be fair and reasonable.

Evidence demonstrated extensive negotiations, fairness opinion support, overwhelming shareholder approval, and the absence of dissent or opposition.

The court concluded the arrangement had a valid business purpose and fairly resolved the interests of affected stakeholders.

The appellant, who was previously found not criminally responsible on account of a mental disorder, appealed a disposition of the Ontario Review Board that imposed a detention order.

The appellant sought an absolute discharge to care for his parents, while amicus curiae argued for a conditional discharge.

The Court of Appeal dismissed the appeal, finding that the appellant remained a significant threat to public safety and had breached the terms of his previous conditional discharge.

The court upheld the Board's conclusion that a detention order was the least onerous and least restrictive disposition.

A non-share religious corporation experienced an internal governance dispute between competing factions claiming authority over its executive committee.

The applicant sought urgent interim relief including supervision of the organization’s financial affairs pending a scheduled injunction motion.

The court emphasized corporate law principles governing non-share corporations, including transparency, procedural fairness, and adherence to constitutional documents and by-laws.

On consent of the parties, the court appointed an independent monitor under s. 101 of the Courts of Justice Act to oversee the organization’s finances, records, and issuance of charitable tax receipts, and ordered that no membership meetings occur before the upcoming hearing.

The monitor was granted access to records and a limited administrative charge for fees.

A court‑appointed receiver sought approval of bidding procedures and a sales process for a distressed technology company, including the use of a stalking horse credit bid by the senior secured lender.

The receiver also sought confirmation of the priority of the receiver’s charge and borrowings charge over existing security interests and approval of its activities to date.

The court applied the Soundair principles in assessing the fairness, transparency, and commercial efficacy of the proposed sales process.

Given the debtor’s lack of liquidity and the need for a rapid process, the court approved the stalking horse structure, the auction procedures, and the expense reimbursement.

The court also granted priority to the receiver’s charges under the Bankruptcy and Insolvency Act and confirmed the receiver’s reported activities.

The applicant corporation sought a final order approving a plan of arrangement under s. 182 of the Ontario Business Corporations Act in connection with the acquisition of all outstanding shares by a subsidiary of the purchaser corporation for cash consideration.

The court applied the framework from BCE Inc. v. 1976 Debentureholders, requiring satisfaction that the transaction constituted a statutory arrangement, that procedural requirements were met, that the application was brought in good faith, and that the arrangement was fair and reasonable.

Evidence demonstrated a robust sale process, board oversight through a special committee, independent financial advice, and a significant premium to market value.

Shareholders overwhelmingly approved the arrangement, no dissent rights were exercised, and no opposition appeared.

The court concluded that the arrangement served a valid business purpose and fairly balanced the interests of affected stakeholders.

In a receivership proceeding, the court considered a motion by a court-appointed receiver for approval of the sale of a condominium unit and a vesting order.

The court applied the principles from Royal Bank of Canada v. Soundair Corp., examining whether the receiver made sufficient efforts to obtain the best price, whether the process was fair and effective, and whether the interests of stakeholders were protected.

The court found that the receiver followed a previously approved marketing process and that the proposed purchase price exceeded comparable appraised values.

No interested party opposed the motion.

The sale was approved and a vesting order granted.

An investigative receiver sought court approval of its reports, activities, and fees incurred during an investigation into the financial affairs of a respondent corporation connected to bankrupt companies operating retirement homes.

The court found the receiver’s mandate report complied with the appointment order and approved the report and the activities described in it.

The respondent requested an adjournment of the motion seeking approval of further receiver and counsel fees, arguing proportionality concerns and potential insolvency.

The court granted the adjournment on fairness grounds, allowing the respondent to file objections to the requested fees, while extending the receiver’s mandate.

The court also permitted the respondent to provide previously omitted bank statements to the receiver but held the receiver need not amend its report to account for them.

In a Bankruptcy and Insolvency Act s. 38 fraudulent conveyance action, the defendants sought to amend their statements of defence and to introduce a counterclaim alleging abuse of process, malicious prosecution, and intimidation.

The plaintiffs opposed the amendments and moved to strike several pleadings, particularly those raising a limitation period defence.

The court held that earlier Rule 21 proceedings had finally determined the limitations issue as a question of law, meaning the defendants were barred by res judicata from re‑pleading or reframing the defence.

The court also found that the proposed counterclaim was unrelated to the trustee’s cause of action pursued under s. 38 and constituted a collateral attack on the order granting leave to commence the proceeding.

Limited amendments were permitted, but most proposed amendments were refused and several pleaded paragraphs were struck.

On an ex parte application under s. 3 of the Bulk Sales Act, the applicants sought an exemption from the Act for a financing transaction involving the sale of certain equipment leases and related assets to a limited partnership.

The court considered whether the transaction constituted a “sale in bulk” outside the ordinary course of business.

While expressing doubt that the transaction fell within the type of asset disposition targeted by the Act, the court proceeded to analyze the exemption request.

Finding that the transaction would be advantageous to the applicants and would not impair their ability to pay creditors, the court granted the exemption for the proposed transaction only.

The court declined to grant any blanket exemption for future transactions and directed that any subsequent application be brought on notice to the Attorney General of Ontario.

The applicants, comprising the First Leaside group of companies, sought an Initial Order under the Companies' Creditors Arrangement Act (CCAA) to conduct an orderly wind-down of their operations.

The court found that the applicants, viewed as a group, were insolvent and that the CCAA could be appropriately used for a liquidating proceeding.

The court also granted super-priority Administration and D&O Charges, dismissing arguments from secured creditors that provincial paramountcy issues precluded such priorities without further notice.

The applicant secured creditor moved to lift a stay of proceedings under the Companies’ Creditors Arrangement Act in order to appoint a receiver over insolvent debtor corporations.

The evidence showed that the court-approved sales process had collapsed, further DIP funding was unavailable after a sales process default, and the debtor companies’ board of directors had resigned, leaving operations effectively shut down.

The monitor supported the motion and no party opposed it.

Applying principles governing the lifting of a CCAA stay, including prejudice to stakeholders and the likelihood that the restructuring would fail, the court concluded that receivership was necessary to stabilize the situation and preserve asset value.

A court-appointed monitor sought directions on an ex parte motion relating to the administration of court-ordered elections within a not-for-profit corporation experiencing internal governance disputes.

The monitor requested an extension of the deadline for the elections and authorization to assist election supervisors with implementing procedural rules governing nominations, campaigning, and notice to members.

The court accepted that additional time was necessary to ensure a fair election process and avoid rushed procedures in a conflict‑ridden organization.

It also held that temporary confidentiality of the proposed election rules was appropriate so that all members would receive the information simultaneously.

The court varied its prior order to extend the deadline for holding elections and expanded the monitor’s mandate to provide election‑related assistance.

The appellant appealed his convictions for aggravated assault and possession of a weapon dangerous to the public peace.

He argued the trial judge misapplied the self-defence provisions of the Criminal Code.

The Court of Appeal dismissed the appeal, finding the trial judge properly concluded the appellant became the aggressor when he exited his vehicle, vitiating his self-defence claim and changing his purpose for possessing the knife to a dangerous one.