Patricia Taylor

The appellants brought motions under Rule 59.06 to set aside a 2018 Divisional Court judgment that upheld securities fraud findings and sanctions against them.

In response, the Ontario Securities Commission moved for security for costs and to strike out seven expert reports filed by the appellants.

The Divisional Court granted the Commission's motions, ordering the appellants to post $100,000 in security for costs due to unpaid prior costs awards.

The court also struck out all seven expert reports, finding they improperly opined on matters of domestic law and factual findings that are the exclusive province of the court, failing the necessity criterion for expert evidence.

The plaintiff, the former manager of the defendant investment fund, sued for fees and damages following the termination of its management agreement.

The defendant fund counterclaimed, alleging the manager was terminated for cause due to material breaches of the standard of care, particularly regarding its handling of the fund's liquidity crisis and its recommendation to enter into a high-interest loan rather than suspending redemptions.

The court found that the manager materially breached the standard of care, justifying the termination.

However, the fund's counterclaim for damages was dismissed as statute-barred under the Limitations Act, 2002.

The manager was awarded certain unpaid fees accrued prior to termination.