G. McGuire

This decision addresses two consolidated applications seeking a declaration that Great American Insurance Company (GAIC) has a duty to defend the City of Thunder Bay in multiple actions concerning "pinhole leaks" in water pipes.

GAIC denied coverage, relying on a lead exclusion clause.

The court found the lead exclusion ambiguous and, applying the "mere possibility" test, determined that GAIC failed to prove the exclusion clearly and unambiguously applied to the claims, which primarily alleged negligence related to the introduction of sodium hydroxide, not lead.

The court declared GAIC obliged to defend the City.

This decision addresses two consolidated applications seeking a declaration that Great American Insurance Company (GAIC) has a duty to defend the City of Thunder Bay in multiple actions concerning "pinhole leaks" in water pipes.

GAIC denied coverage, relying on a lead exclusion clause.

The court found the lead exclusion ambiguous and, applying the "mere possibility" test, determined that GAIC failed to prove the exclusion clearly and unambiguously applied to the claims, which primarily alleged negligence related to the introduction of sodium hydroxide, not lead.

The court declared GAIC obliged to defend the City.

The defendant insurer moved under Rule 30.10 for production of records from various non-parties, including the Ontario Provincial Police (OPP), relating to an organized crime investigation known as Project Hobart.

The insurer sought these records to defend an action for coverage following an arson at the plaintiff's business premises.

The court dismissed the motion for the OPP records, finding that the insurer failed to establish that the criminal investigation file, which did not involve arson charges, was relevant to a material issue in the civil action.

An alternative request to stay the action was also dismissed, and costs were awarded to the responding parties.

Kik Interactive Inc. sought indemnification from AIG Insurance Company of Canada for legal expenses incurred defending an action by the Securities Exchange Commission (SEC) related to its cryptocurrency, Kin.

Kik argued the SEC claim was a securities claim covered by its AIG PrivateEdge Plus policy.

AIG denied coverage, citing exclusion 4(j) for claims arising from any public offering of securities.

Kik contended the exclusion was ambiguous or, alternatively, that an exception to the exclusion applied.

The court found the exclusion unambiguous, applying to all public offerings of securities, not just initial public offerings of shares.

It also determined that Kik failed to satisfy the conditions for the exception to the exclusion, as it did not provide proper notice or underwriting information, nor did AIG offer additional coverage.

Consequently, Kik's application for indemnification was dismissed.

The defendant moved to discharge a Certificate of Pending Litigation (CPL) that the plaintiff had obtained ex parte.

The court found that the plaintiff failed to make full and frank disclosure of material facts, specifically the existence of two agreements relinquishing his interest in the property, and relied on a fraudulent invoice.

The court also considered that damages would be an adequate remedy for the plaintiff and that the defendant would suffer prejudice if the CPL remained.

Concluding that the plaintiff did not come to court with clean hands, the Master ordered the discharge of the CPL.

The plaintiff, Daniel Avon, brought a motion seeking answers to questions refused or taken under advisement during the examination for discovery of the defendant, NFP Canada Corp. The action involves claims of constructive dismissal by the plaintiff and a counterclaim for breach of contract by the defendant.

The Master applied the relevance test under Rule 31.06 and proportionality principles under Rule 29.2.03 of the Rules of Civil Procedure.

The Master ordered answers to questions concerning the nature of a new position offered to the plaintiff and an alleged pattern of behavior, finding them relevant and proportionate.

However, two questions seeking broad access to texts and emails were deemed overly broad and not required to be answered.

No costs were awarded, as both parties achieved partial success.

This decision addresses the issue of costs following a motion brought by the defendant Brunning for document inspection and particulars, which was largely unsuccessful.

The plaintiffs sought substantial indemnity costs, while Brunning requested costs be reserved or no costs.

The court considered factors under s. 131 of the Courts of Justice Act and Rule 57.01 of the Rules of Civil Procedure, noting the plaintiffs' substantial success on the motion.

However, the court also acknowledged that the plaintiffs' initial refusals to provide requested information contributed to the necessity of the motion.

Finding that both parties had "dug in their heels," the court ordered the defendant Fay Brunning to pay the plaintiffs $6,197.40 in costs, inclusive of fees, disbursements, and HST, payable within 30 days.

The applicant, DHMK Properties Inc., sought summary judgment for damages following the respondents' (2296608 Ontario Inc. and Mund Real Estate Group Inc.) repudiation of a real estate purchase agreement.

The respondents had refused to close a $5.3 million transaction and subsequently sued for specific performance with an abatement, which was dismissed.

DHMK claimed $930,000 in damages, representing the difference between the contract price and the property's market value, less the forfeited deposit.

The respondents argued DHMK failed to mitigate by refusing a post-judgment offer to complete the original contract and that the damages calculation was flawed by ignoring a warranty regarding net operating income.

The court granted summary judgment to DHMK for $930,000, affirming the standard measure of damages for breach of a land sale contract and rejecting the respondents' mitigation and damages calculation arguments.

The plaintiff, having been awarded judgment for $687,639.50 CAD, sought prejudgment interest.

The court determined the applicable prejudgment interest rate under the Courts of Justice Act, s.127(1), to be 2.1%.

This rate was an average calculated over the lengthy period from the action's commencement in January 2006 to the date of judgment in April 2016, deemed a fairer rate given the fluctuations.

The court also specified the periods for which interest would be allowed on various components of the damages, distinguishing between "past pecuniary loss" and general damages as per s.128(3) of the Act.

This decision addresses costs following a trial where the plaintiff, Mark Couper, was largely successful on a breach of contract claim, while most other claims and the defendants' counterclaim were dismissed.

The court considered principles under the Courts of Justice Act and Rules of Civil Procedure, including the result, offers to settle, complexity, and conduct of parties.

It denied substantial indemnity costs for mutual allegations of fraud and discreditable conduct, treating them as offsetting.

However, substantial indemnity costs were awarded to the plaintiff for the counterclaim due to the defendants' extraordinary non-disclosure of documents, and for the mistrial motion from the date of the plaintiff's unaccepted offer to settle under Rule 49.

The plaintiff was awarded partial indemnity costs for the main action.

The court determined the applicable exchange rate for damages previously awarded in U.S. dollars.

Pursuant to section 121(3) of the Courts of Justice Act, the court exercised its discretion to fix the exchange rates at the historical dates when the obligations to pay arose, rather than the date of payment or judgment delivery.

This approach ensured a fixed Canadian dollar judgment and placed the creditor in the position they would have been in had payments been made when due.

The total Canadian dollar award was calculated.

The Attorney General of Canada moved to vary a Mareva injunction obtained by victims of terrorism seeking to enforce a U.S. judgment against Iran.

The motion concerned whether Iranian diplomatic property in Canada could remain subject to the injunction.

The court held that the plaintiffs had failed to make full and frank disclosure when obtaining the original ex parte orders, including failing to disclose unsuccessful attempts to attach similar Iranian diplomatic property in the United States and mischaracterizing relevant Canadian authority concerning the Vienna Convention and Crown prerogative.

Given the material nondisclosure and the principles of diplomatic immunity under the State Immunity Act and Foreign Missions and International Organizations Act, the court varied the Mareva order to exclude assets certified by the Minister of Foreign Affairs as diplomatic property.

The plaintiffs brought an ex parte motion seeking confirmation that certain bank accounts identified by the federal government as assets of a foreign state fell within the scope of an existing Mareva injunction issued in an action to recognize and enforce a U.S. terrorism judgment.

Relying on information provided by the Department of Foreign Affairs pursuant to s. 12.1 of the State Immunity Act, the plaintiffs argued that the accounts constituted assets of the defendants in Canada and should therefore be frozen under the existing order.

The court held that the plaintiffs had established a strong arguable case that the identified accounts were subject to the Mareva order and confirmed that the injunction applied to those accounts.

However, broader disclosure of full banking records was limited to situations where the accounts were held directly by entities already named in the injunction, with further directions reserved for later proceedings.

Investor plaintiffs alleged fraud, knowing receipt, and unjust enrichment against the principal of an investment company and related parties following the company’s bankruptcy.

They brought a motion seeking ex parte Mareva injunctions and, alternatively, Norwich orders against financial institutions holding accounts of the defendants.

The court held that ex parte relief requires strict full and frank disclosure and evidence of extraordinary urgency.

Because the motion record contained inaccuracies regarding the state of the pleadings and omitted a filed statement of defence, and because the defendants had long been aware of the litigation and potential asset-freezing relief, the plaintiffs failed to justify proceeding without notice.

The court therefore declined to hear the motion ex parte and required that notice be given to the responding parties.

A creditor applied for a bankruptcy order against the respondent debtor under s. 43 of the Bankruptcy and Insolvency Act based on multiple unpaid judgments exceeding $5 million.

The debtor conceded that an act of bankruptcy had occurred but argued the application should be dismissed under s. 43(7) because it was brought for an improper purpose and because bankruptcy would produce no benefit for creditors.

The court rejected allegations that the application was motivated by malice, finding it was a legitimate attempt by a judgment creditor to enforce a debt, particularly given the existence of additional unpaid judgments.

The court also rejected the debtor’s unsupported claim of having no assets, concluding that a trustee’s investigation could uncover realizable assets.

The application was granted and the debtor was adjudged bankrupt.