David Preger

The Applicants in a CCAA proceeding moved for a reverse vesting order to approve a transaction with a purchaser related to a secured creditor, Marzilli.

The transaction would vest out the first-ranking security interest of another creditor, 212, and transfer its debt to a residual entity with no assets. 212 opposed the motion, arguing its debt assumption was part of the stalking horse bid that set the floor for the sales process.

The court applied the Third Eye and Harte Gold factors, finding that 212 had not consented to the vesting out of its interest and that the equities favoured 212.

The court dismissed the motion for the reverse vesting order, concluding it was not equitable to extinguish 212's first-ranking security interest under the circumstances.

The applicants sought a declaration that a 2001 easement and restrictive covenant registered on title to a former golf course prohibited the respondent from developing the lands for residential use.

The respondent argued the covenant only protected storm water management access and did not prevent development.

The court applied contract interpretation principles and found the plain language of the restrictive covenant, read in context, constituted a complete prohibition on building structures on the golf course lands.

By operation of the Land Titles Act, the covenant was deemed to expire 40 years after registration, prohibiting residential development until 2041.

Following a successful summary judgment motion where the plaintiff recovered her deposit on a failed condominium purchase, the plaintiff sought costs of $483,236 on a substantial indemnity basis.

The court found the plaintiff's Rule 49 offers did not contain a clear, understandable compromise, disentitling her to substantial indemnity costs.

Applying the factors under Rule 57.01, the court noted the plaintiff's scattergun approach, unnecessary proceedings, and excessive billing.

The court fixed partial indemnity costs at $225,000, reflecting a fair and reasonable amount the defendant could expect to pay.

The applicants, a group of mortgage investors, applied to appoint a receiver over the property of the respondent, a not-for-profit corporation operating a church and school, due to an outstanding loan balance of approximately $11.5 million.

The respondent had previously commenced an action against the applicants alleging conspiracy and seeking restitution.

The court dismissed the application, finding it was not just and convenient to appoint a receiver because the respondent raised triable issues, the property value greatly exceeded the debt, and a receivership would effectively end the ongoing litigation and negatively impact the church and school.

The applicants brought an oppression application regarding a family investment company, Naim Investments Limited.

They alleged that the proposed sale of a 10% shareholding by an estate to a third party, Dr. Low, was a disguised sale to a rival family branch that would breach an unwritten control agreement and a written ownership restriction agreement.

The court found no evidence of a control agreement, determined that Dr. Low was an arm's length purchaser, and concluded that the election of a new board to approve the sale was a proper exercise of corporate governance to resolve a deadlock.

The application was dismissed with costs.