David S. Ward

The defendants moved under Rule 59.06(2)(a) of the Rules of Civil Procedure to set aside a consent judgment on the ground that it had been obtained by fraud.

They alleged that the plaintiff lender had agreed to hold the consent judgment in escrow and not enforce it, and raised additional arguments concerning the validity of default interest under the Interest Act.

The court held that Rule 59.06 is limited to circumstances where fraud in obtaining the judgment is established and does not permit the court to revisit the correctness of the judgment itself.

The defendants failed to prove that any representation was made that the consent judgment would not be enforced, and the alleged oral arrangement was inconsistent with the written agreements and the parties’ conduct.

The motion was dismissed and substantial indemnity costs were awarded against the defendants.

The applicant sought recognition and enforcement of a Florida court's letters rogatory in support of post-divorce litigation alleging fraudulent concealment of matrimonial assets through a Canadian corporation.

Applying the six guideposts governing letters rogatory enforcement, the court held the requested evidence was relevant, necessary for trial, not otherwise obtainable, sufficiently specific, and not contrary to public policy.

The court rejected most overbreadth and burden objections, but narrowed one document request by replacing “and/or” with “and” and declined to compel production of entire employment files.

The request was otherwise enforced.

The Trustee in Bankruptcy sought an order under s. 164 of the Bankruptcy and Insolvency Act compelling the former Chief Restructuring Officer (CRO) and a secured creditor to produce documents.

The respondents claimed solicitor-client and litigation privilege over the documents.

The Trustee argued that the CRO could not assert privilege against the Trustee and that any common interest privilege was dissolved upon the CRO's appointment.

The court dismissed the motion, holding that the CRO could assert privilege regarding its specific duties and that the common interest privilege between the secured creditor and the CRO (acting as a consultant prior to appointment) was not dissolved.

The appellant, who purchased a portion of the bankrupt company's business, appealed the Trustee's disallowance of various claims totaling over $3 million.

The claims sought reimbursement of expenses and damages allegedly resulting from misrepresentations in unaudited internal financial statements provided prior to the sale.

The court upheld the Trustee's disallowance, finding that the Asset Purchase Agreement contained 'as is, where is' and entire agreement clauses, and that the claims were barred by res judicata due to prior court orders approving the sale and discharging the Chief Restructuring Officer.

The appeal was dismissed.

The tenant obtained creditor protection under the CCAA and sent a letter to the landlord repudiating its commercial lease.

The landlord did not acknowledge or accept the repudiation.

The tenant subsequently went bankrupt, and the trustee in bankruptcy disclaimed the lease, disallowing the landlord's claim for unrecoverable expenses for the remainder of the lease term.

The landlord's successor appealed the dismissal of its motion to set aside the disallowance.

The Court of Appeal dismissed the appeal, holding that an unaccepted repudiation does not terminate a lease, and therefore the lease remained in effect at the date of bankruptcy and was subject to the trustee's statutory disclaimer.

The appellant appealed a judgment regarding the interpretation of a corporate resolution related to a share purchase agreement.

Under the agreement, the appellant received an $800,000 reduction in the purchase price in exchange for a pre-closing dividend declaration in favour of the respondent.

The Court of Appeal dismissed the appeal, finding that the appellant's interpretation would allow it to enjoy both the reduced purchase price and full ownership of the warrants involved in the dividend, which was contrary to the parties' joint good faith commercial intentions.

The vendor and purchaser of certain businesses disagreed on the method of calculating working capital adjustments under an asset purchase agreement.

An accounting firm, KPMG, was directed to calculate the adjustments according to approaches advocated by both parties.

The purchaser sought leave to appeal an order requiring it to make a payment based on KPMG's calculation, arguing KPMG exceeded its jurisdiction.

The Court of Appeal denied leave to appeal, finding that KPMG stayed within its mandate and its determination was final and binding.

The appellants, investors in a failed real estate redevelopment project, appealed the dismissal of their claims for rescission and damages against the promoter, Shelter Corporation.

The trial judge found that Shelter breached numerous contractual commitments, causing the loss of the investment, but held that rescission was unavailable and no damages were proven because the project was too heavily leveraged to survive the market downturn.

The Court of Appeal upheld the trial judge's findings that the breaches were not fundamental and that the appellants had not proven substantial damages.

However, the Court allowed the appeal to the limited extent of awarding nominal damages of $1 to each appellant for the proven breaches of contract.

A cross-appeal by the financial institutions regarding equitable set-off and penalty interest rates was dismissed.

The appellant bank appealed a trial judgment holding it liable for the unauthorized transfer of $4 million of the respondent's funds.

The appellant argued the trial judge erred by relying on hearsay evidence to reject its defences of acquiescence, ratification, and contributory negligence, by failing to draw an adverse inference, and by not reducing damages.

The Court of Appeal dismissed the appeal, finding the out-of-court statements were properly admitted to show the respondent's state of mind, not for their truth.

The court also upheld the trial judge's findings on the adverse inference and damages.