Hedy L. Epstein

The plaintiff, a former Toronto police officer, sued the defendants for malicious prosecution, negligent investigation, misfeasance in public office, intentional infliction of emotional distress, and Charter breaches following his arrest and prosecution for corruption and other offences.

The criminal charges were ultimately stayed or withdrawn.

The court dismissed the action, finding that the plaintiff failed to prove the absence of reasonable and probable grounds for the charges, which was fatal to the malicious prosecution and negligent investigation claims.

The court also found no evidence of malice, deliberate unlawful conduct intended to harm, or conduct calculated to cause mental suffering.

The claim for Charter damages was also dismissed.

The parties settled this litigation, and the defendants brought a motion on consent to dismiss the claim without costs.

The court granted the order, dismissing the action on a without costs basis, noting that the reasons for decision were deemed an operative and enforceable order due to the Covid-19 emergency.

The plaintiff appealed a Master's order granting the defendants' motion for security for costs in an action for negligent investigation, wrongful arrest, and malicious prosecution.

The plaintiff argued the Master erred in granting leave to bring the motion after the action was set down for trial and in ordering security for costs.

The Superior Court of Justice dismissed the appeal, finding no error in the Master's decision to grant leave or in the conclusion that the defendants had a good defence on the merits and the plaintiff lacked sufficient assets to satisfy a costs award.

The plaintiff mortgage broker, OMJ Mortgage Capital Inc. (OMJ), sued the defendant, King Square Limited (KSL), for commissions on three loans extended by Firm Capital Corporation (FCC).

OMJ claimed commissions on two loans to KSL and one loan to King Square Hotel Corporation (KSHC), arguing they were further advances under an original loan commitment or covered by the holdover period of their commission agreement.

KSL contended the loans were new and outside the agreement's terms, and that it was not liable for a loan to KSHC, a separate entity.

The court found the two loans to KSL were further advances under the original commitment, entitling OMJ to commissions, and that KSL breached its duty of good faith by not disclosing these advances.

However, the court dismissed OMJ's claim for commission on the KSHC loan, finding it was a distinct loan not covered by the agreement's terms or the definition of "Borrower."

This endorsement addresses the costs arising from a prior judgment (2019 ONSC 19) where the plaintiff, Harry Pohl, was successful.

The court awarded costs on a partial indemnity basis, considering the complexity of the eleven-day trial, the proportionality of the award to the judgment amount of $225,297.20 (plus interest), and the conduct of the parties.

Specific deductions were made for costs related to a dismissed party (Karen Palisca) and certain disbursements, including excessive witness fees and litigation software deemed office overhead.

Disbursements for IT services to recover company data were allowed as necessary for the proceeding.

The plaintiff, Harry Pohl, sued the defendants for breach of contract, wrongful dismissal, and oppression under the OBCA, following the sale of his company, Die-Metric Tool Inc. (DMT), to corporations controlled by Walter Palisca.

The defendants counterclaimed for breach of contract.

The court dismissed Pohl's claims for breach of contract (regarding the $1.5M sale price) and wrongful dismissal, and also dismissed the defendants' counterclaim.

However, the court found that Walter Palisca, as director and controlling mind, breached his statutory duty to DMT and the common law duty of honest performance by improperly diverting $225,297.20 of DMT's funds (from a bankruptcy settlement) to affiliated companies (PTL and PS) and for personal legal fees, to the detriment of DMT and Pohl as a personal guarantor.

The court also found oppression under s. 248(2) of the OBCA.

Judgment was awarded to Pohl against Walter Palisca, Palcam Technologies Ltd., and Palcam Solutions Inc. (and/or 1401763 Ontario Inc.) jointly and severally for $225,297.20.

Following an eight-day jury trial where the plaintiff was awarded $10,000 in general damages for assault by a police officer, the plaintiff sought partial indemnity costs of $86,655.32.

The defendants argued that no costs should be awarded as the damages fell within the monetary jurisdiction of the Small Claims Court.

The court, exercising its discretion under Rule 57.05(1) of the Rules of Civil Procedure, denied the plaintiff's request for costs.

The judge found the case was not complex, the award was not close to the Small Claims maximum, and the plaintiff failed to adequately assess the quantum of damages, making the Superior Court an inappropriate venue for the action.

The plaintiff's action against police defendants, alleging Charter breaches, negligent investigation, falsified evidence, and assault, was dismissed after a lengthy trial where the plaintiff failed to prove any allegations and was found to be an incredible witness.

The defendants, as the successful parties, sought partial indemnity costs.

The court, applying Rule 57.01 of the Rules of Civil Procedure, considered the seriousness of the plaintiff's unsubstantiated allegations and his conduct in forcing a lengthy trial.

The court awarded the defendants partial indemnity costs in the amount of $367,704.87, finding the request fair and reasonable.

The defendants, including the Thunder Bay Police Services Board and the Attorney General of Canada, brought a motion to transfer a civil action from Toronto to Thunder Bay.

The plaintiff opposed, citing concerns about a fair trial due to local family prominence, publicity, judicial conflicts, and financial hardship.

The court granted the transfer, finding that the interests of justice favored Thunder Bay because a substantial part of the events, damages, and subject matter were located there.

The court emphasized the local community's interest in allegations of police misconduct and the convenience for the majority of parties and witnesses residing in Thunder Bay.

The plaintiff's concerns about fairness and judicial bias were dismissed as speculative or manageable.

The plaintiff sued the police for negligent investigation, assault and battery, misfeasance of public office, and conversion of property following his arrest on drug trafficking charges that were later stayed.

The plaintiff alleged the police relied on fabricated information to obtain wiretap authorizations and used excessive force during his arrest, causing severe injuries including deep vein thrombosis.

The court dismissed the action in its entirety, finding the wiretap authorizations were validly issued based on reasonable grounds and the police did not breach their duty of care.

The court also rejected the plaintiff's claims of excessive force, finding his injuries were minor, his testimony lacked credibility, and his severe medical issues were pre-existing.

Carl Gorman applied for relief under the Canada Business Corporations Act and the Ontario Business Corporations Act.

Wade Kosowan brought a motion to stay the application, arguing lack of jurisdiction and opposing interim terms.

The court granted an adjournment but imposed interim terms, reinstating Gorman to his position and duties with the respondent corporations, finding Kosowan's unilateral termination and exclusion of Gorman without arbitration constituted unequal and unfair treatment.

The court also ordered Kosowan's motion to stay and Gorman's application to be heard on the same return date to expedite resolution.

The defendant brought a motion for security for costs against the corporate plaintiff under Rule 56.01(1)(d).

The plaintiff opposed, arguing impecuniosity caused by the defendant's failure to pay outstanding invoices.

The court found the plaintiff failed to establish impecuniosity due to insufficient financial disclosure.

However, the court dismissed the motion, finding the plaintiff had a good chance of success on the merits and that its financial difficulties were largely caused by the defendant's refusal to pay approved invoices.

The municipal defendant brought a motion for summary judgment dismissing negligence claims as statute‑barred under the Limitations Act, 2002.

The plaintiff alleged the municipality failed to enforce by-laws relating to a neighbour’s road construction, drainage issues, and fence encroachments affecting the use and enjoyment of her property.

The court held that the road and drainage allegations were discovered more than two years before the action was commenced and were therefore barred by the limitation period.

However, alleged fence alterations occurring in 2012 and 2013 could potentially constitute newly discoverable claims within the limitation period.

Summary judgment was granted in part, dismissing the road and drainage claims while permitting fence-related claims against the municipality to proceed to trial.

A dispute arose over entitlement to a $75,000 deposit following the failed closing of a residential real estate transaction governed by an Agreement of Purchase and Sale.

The contractual closing date passed without either party being ready to close, leaving the agreement alive and permitting either party to re‑establish time of the essence by fixing a reasonable new closing date.

The purchasers subsequently declared they would not proceed and sought a mutual release, asserting the vendor was in breach.

The court held the purchasers repudiated the agreement without first setting a new closing date or reinstating time of the essence.

The vendor later properly re‑established a closing date and tendered; the purchasers refused the tender.

Relief from forfeiture was denied and the deposit was ordered released to the vendor.

The accused brought a pre‑trial application seeking a stay of fraud charges on the basis of issue estoppel and abuse of process.

She argued that a prior civil tax proceeding in the Tax Court of Canada, resolved by consent judgment in her favour concerning liability for unremitted source deductions, determined the same central issue as the criminal prosecution.

The court held that issue estoppel requires a prior judicial determination on the merits and that a consent judgment does not constitute such a determination.

The court also found the record insufficient to establish that the civil and criminal proceedings addressed identical issues.

As the prerequisites for issue estoppel were not met, the application for a stay was dismissed.

In a large fraud prosecution involving alleged diversion of payroll source deductions, the accused brought a pre‑trial application alleging that tax authorities improperly used civil audit powers to gather evidence for a criminal investigation, contrary to the principles in R. v. Jarvis.

The Crown moved to summarily dismiss the application under Rule 34.02 of the Criminal Proceedings Rules.

The court held the accused lacked standing to challenge searches and production orders affecting third parties because they had no reasonable expectation of privacy in those locations or records.

The court further found there was no evidentiary basis to support the allegation that the tax authority’s audit powers were used for a predominant criminal investigative purpose.

The application was therefore dismissed without a full hearing.

The accused, charged with fraud relating to alleged diversion of payroll source deductions owed to the Canada Revenue Agency, brought a motion to quash a subpoena issued to their former solicitor requiring the production of files.

They argued the subpoena process violated their s. 8 Charter rights and that the Crown was required to obtain the documents through a search warrant complying with the guidelines in R. v. Lavallee.

The court held that the subpoena did not constitute a search or seizure because the documents remained in the lawyer’s custody and were merely brought before the court without state access.

Alternatively, the court held that a subpoena is a valid mechanism for compelling production of records from a lawyer’s office and may constitute a less intrusive alternative to a search warrant, provided protections for solicitor‑client privilege are respected.

Following a successful motion by the plaintiff to strike portions of the statement of claim, the court determined the appropriate costs award.

The plaintiff sought $12,816.24 on a partial indemnity basis.

The court reviewed the discretion to award costs under s. 131 of the Courts of Justice Act and the factors under Rule 57.01 of the Rules of Civil Procedure, including the complexity of the issues, efficiency of the proceeding, and conduct of the parties.

The court noted the breadth of the original motion challenging several tort claims and the preparation required by the plaintiff’s counsel.

Costs were fixed at a reduced amount as fair and reasonable in the circumstances.

The defendants moved under Rules 21.01 and 25.11 of the Rules of Civil Procedure to strike portions of the plaintiff’s statement of claim alleging conspiracy, intentional interference with contractual relations, and personal liability of individual defendants, or alternatively for further particulars.

The action arose from an agreement for the acquisition of corporations owned by the plaintiff, followed by allegations that the defendants diverted assets, issued fraudulent invoices, and caused the companies’ insolvency.

The court reviewed the pleading standards applicable to motions to strike and emphasized the low threshold required to sustain pleadings where material facts supporting recognized causes of action are alleged.

It held that the pleadings sufficiently alleged elements of civil conspiracy, intentional interference with contractual relations, and potential personal liability through closely held corporate entities.

The motion to strike was dismissed and the defendants were ordered to deliver a statement of defence.

The Crown brought an application to admit the audio and written statements of a deceased witness under the principled exception to the hearsay rule.

The court accepted that necessity was established because the declarant had died, but considered whether the statements met the threshold reliability requirement.

The court held that the unsigned and undated handwritten statements lacked sufficient indicia of reliability and authenticity and were therefore inadmissible.

However, the recorded audio interview was found sufficiently reliable and probative, given its voluntary nature, contemporaneity, detailed content, and potential corroboration by other witnesses.

The audio statement was admitted subject to editing to remove speculative or prejudicial portions.