The appellant, a franchisor, obtained foreign default judgments against the respondent franchisees after terminating their franchise agreements and seizing their assets without accounting for the value of the seized inventory.
The appellant then filed petitions in bankruptcy in Ontario based on the foreign judgments.
The trial judge dismissed the petitions under s. 43(7) of the Bankruptcy and Insolvency Act, finding that the appellant's attempt to obtain double recovery by failing to account for the seized assets constituted 'sufficient cause' to deny the petitions.
The Court of Appeal upheld the decision, confirming that the trial judge properly exercised his discretion to dismiss the petitions due to the appellant's unconscionable conduct.
