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Certificate of Pending Litigation granted where triable constructive trust claim over property established.
The plaintiffs, a group of affiliated corporations under Companies’ Creditors Arrangement Act proceedings, brought a motion for leave to issue a Certificate of Pending Litigation against residential property owned by one defendant.
The plaintiffs alleged that corporate funds were improperly used to pay for renovations, maintenance, and improvements to the property and sought a constructive trust and tracing remedies.
The defendants opposed the motion and brought a cross‑motion to strike portions of the affidavit evidence filed in support of the motion.
The court held that the affidavit material was relevant and properly admitted and dismissed the cross‑motion.
Finding that the evidentiary record disclosed triable issues regarding alleged misappropriation of corporate funds and potential unjust enrichment supporting a constructive trust, the court granted leave to issue the Certificate of Pending Litigation.
