Howard B. Borlack

The plaintiffs brought an interpleader claim regarding $2,857,831.58 held in escrow following the sale of a real estate development property under a power of sale.

The funds represented a portion of the remaining sale proceeds after the discharge of a first mortgage.

The court found that the joint venturers had structured their investment as a loan to defer capital gains tax, which operated as an equitable charge on the limited partner's interest.

The court held that the plaintiffs were entitled to priority distribution of the escrowed funds over the defendants' claims for partnership set-off, pursuant to the trust obligations and section 44 of the Partnerships Act.

The defendant, Breakaway Painting, brought a motion to disqualify the plaintiffs' law firm, McCague Borlack, because a lawyer who previously worked at the firm defending Breakaway had joined McCague Borlack.

The transferring lawyer had been a partner at the previous firm but worked from home and had no involvement in Breakaway's defence.

The court applied the test from MacDonald Estate v. Martin and found that the transferring lawyer rebutted the presumption of having received confidential information.

As the lawyer possessed no actual or imputed confidential information, the new firm was not disqualified.

The motion was dismissed.

This decision concerns the approval of a sale process and a motion to appoint the sales officer as receiver in the context of a deadlocked insurance brokerage business.

The court approves the sale process and related ancillary relief, including the appointment of an interim broker and non-solicitation orders, but dismisses the motion to appoint the sales officer as receiver.

The ruling addresses issues of conflict of interest, compliance with prior orders, and the preservation of assets pending winding up.

This endorsement addresses the costs of a motion for advice and directions brought by a Sales Officer in three oppression remedy applications.

The underlying motion resolved in favour of Doug Middleton, Jason Middleton, and JDM Group Ltd. (the "Middleton parties") against Mark Ber and his affiliates (the "Ber parties"), finding Mark's actions had undermined the Sales Officer's mandate.

The court considered whether Mark's conduct warranted substantial indemnity costs, ultimately concluding it did not meet the threshold for "reprehensible, scandalous or outrageous" behaviour.

The court ordered the Ber parties to pay partial indemnity costs to the Middleton parties and deferred any ruling on the disproportionate allocation of the Sales Officer's costs.

This motion, brought by the court-appointed Sales Officer in consolidated oppression remedy applications, sought directions regarding the inclusion of insurance policies in the sale plan of two closely held companies, Producer’s Planning Group Ltd. and The Benefits Group Inc. The dispute centered on 789 policies (PG Transferred Policies) that had been transferred to Mark Ber's company, The Producer’s Group Ltd. The court addressed two main issues: the ownership of 'PG Originating Policies' and the inclusion of 'PG Orphaned Policies' which clients transferred to Mark Ber's company after he ceased providing services through the original companies.

The court found that the PG Originating Policies were owned by the Planning Group and that Mark Ber improperly caused their transfer.

It also found that the PG Orphaned Policies should be included in the sale plan due to Mark Ber's unilateral actions undermining the court's prior order.

The court dismissed the respondents' request for a trial of issues, affirming its jurisdiction to decide the matter on the written record, consistent with Commercial List practice.

The moving parties brought a motion to vary an order dated August 25, 2023, and sought costs on a motion for leave to appeal.

The Divisional Court dismissed the motion to vary the order and determined that no costs should be awarded on the motion for leave to appeal.

The defendant, Nuruddin Janmohamed, brought a motion to strike the plaintiff's claim for misrepresentation or, alternatively, for summary judgment, arguing lack of standing, no misrepresentation, no damages, and that the claim was statute-barred.

The plaintiff, Mahamud Husein, alleged misrepresentation regarding an insurance policy's premium increases.

The court dismissed both motions, finding the claim disclosed a cause of action for negligent misrepresentation and that genuine issues requiring a trial existed, particularly concerning the alleged misrepresentations, reliance, and damages.

The limitation period argument was also dismissed.

The plaintiffs initiated an action against the defendants for breach of contract, negligence, breach of fiduciary duty, and negligent or fraudulent misrepresentation concerning investment rental properties and their management.

The defendants brought a motion for summary judgment, arguing the claim was time-barred under the Limitations Act, 2002.

The court found the action amenable to summary judgment and determined that the plaintiffs had sufficient knowledge of their loss and its cause by December 12, 2017, at the latest, when they terminated their property management agreement.

As the Statement of Claim was issued on March 16, 2020, beyond the two-year limitation period, the court granted summary judgment to the defendants and dismissed the action as time-barred.

The plaintiffs brought a motion to compel the defendant to attend examinations for discovery, and the defendants brought a motion for security for costs against the plaintiffs, arguing they were undischarged bankrupts and nominal plaintiffs.

The court dismissed the motion for security for costs, finding that the individual plaintiff was not a nominal plaintiff and that it would not be just to order security given the plaintiffs' strong case on the merits that their financial ruin was caused by the defendants' actions.

The court granted the motion to compel discovery, ordering the defendant to attend by video in short increments to accommodate his health issues.

The moving parties brought a motion for leave to appeal the order of Cavanagh J. dated March 28, 2023.

The responding parties did not file any materials.

The Divisional Court dismissed the motion for leave to appeal.

As the responding parties did not participate, no order as to costs was made.

This is a costs endorsement for three related applications concerning shareholder rights and oppression remedies in private companies (Producers Planning Group Ltd., The Benefits Group Inc., and Thornbridge Capital Inc.).

The main applications resulted in an order for the sale of businesses and assets of two companies, while claims for oppression remedies were dismissed for all parties.

The court found that all parties had substantial success as respondents in opposing the oppression claims made against them.

Due to the overlapping issues and the divided success, the court ordered no costs for any of the three applications, as the costs of successful respondents would largely offset the costs for which they would be liable as applicants in other applications.

The appellant, Venmar Ventilation Inc., appealed a trial judgment finding it liable for negligent design after a ventilator motor caught fire and destroyed the respondents' home.

The trial judge found Venmar liable for failing to incorporate adequate thermal protection in its ventilator design, but dismissed claims against the motor manufacturer, Fasco, finding it owed no duty of care and was contractually indemnified by Venmar.

The Court of Appeal upheld the trial judge's findings on liability, negligent design, and contractual indemnity.

However, the Court allowed Fasco's cross-appeal on costs, finding the trial judge erred by failing to consider the contractual indemnity provision when assessing the scale and quantum of costs, and remitted the costs issue back to the trial judge.

Three related applications were brought concerning shareholder disputes in three closely held corporations operating as insurance brokerages and an investment holding company.

The applicants sought declarations of oppression and various remedial orders, including share buyouts and winding up.

The court dismissed all claims of oppression, finding no conduct that violated reasonable expectations.

However, the court found that the shareholders of two of the operating companies were hopelessly deadlocked and unable to work together.

Consequently, the court ordered the winding up of those two companies under the just and equitable ground of the Business Corporations Act, while dismissing the request to wind up the investment holding company.

The appellants, a group of subcontractors and a bank, appealed an application judge's decision that rescission of surety bonds might be possible even if it affects innocent third parties.

The bonds were issued by Zurich Insurance Company Ltd. for a large construction project, but Zurich later discovered alleged fraudulent misrepresentations and collusion that induced it to issue the bonds.

The appellants sought a declaration that rescission was unavailable as a matter of law due to the involvement of innocent third parties.

The Court of Appeal dismissed the appeal, affirming that prejudice to third parties is not an absolute bar to rescission, especially in cases of fraudulent misrepresentation, and that such a determination requires a full factual record at trial.

Zurich, the surety for the insolvent general contractor Bondfield, brought a motion to intervene as a party in a construction lien reference.

Zurich sought to participate in a vetting committee for the distribution of the owner's holdback among the timely lien claimants.

The court granted the motion, finding that Zurich had a direct interest in the holdback because it had made significant holdback advances to the major electrical and mechanical trades and had taken partial assignments of their lien rights.

The court ordered the timely claimants to pay Zurich's costs of $30,000.

The plaintiffs, The Calbot Group Ltd. and 2649106 Ontario Inc. cob Synergy Capital, brought two motions: a Preservation Motion seeking to secure $5 million from land sale proceeds and a Jurisdiction Motion against certain foreign defendants.

The court first addressed the Jurisdiction Motion, finding that the plaintiffs failed to establish a real and substantial connection between the foreign defendants (NSR Canada Development Limited, New Silk Road Culturaltainment Ltd., and Sha Huang aka Sam Huang) and Ontario, as the alleged contract (MOU or verbal agreement) was not genuine and the corporate veil could not be pierced.

Consequently, the action against these foreign defendants and Mr. Huang was stayed.

The Preservation Motion, seeking relief under Rule 45.02, a Certificate of Pending Litigation (CPL), or Mareva injunction, was also dismissed.

The court found that the plaintiffs' claim was for damages, not a specific fund, and they failed to demonstrate a serious prospect of success or meet the stringent requirements for such remedies.

Costs were awarded to the successful defendants.

The Court of Appeal for Ontario issued a costs endorsement following an appeal brought by the Debtor, Wayne Biggar.

The Court found that Mr. Biggar's appeal was brought to the wrong court and constituted an obvious delay tactic.

As a result, the Creditors, Jack Pinder, Victor Dusik, and Innotech Safety Solutions Inc., were awarded substantial indemnity costs fixed at $11,500, inclusive of disbursements and applicable taxes, payable by Mr. Biggar within five days.

The plaintiff sought costs after successfully resisting the defendants' motions to strike and for summary judgment.

The court awarded the plaintiff $7,500 in costs for the motion to strike.

However, the court denied the plaintiff costs for the summary judgment motion because the plaintiff's principal sent an improper email threatening the defendants with criminal charges to extort a settlement.

The applicants, a syndicate of lenders and various construction trades, sought declarations that the respondent surety could not rescind performance and payment bonds issued for a hospital redevelopment project.

The surety had discovered alleged fraud and collusion in the procurement process and commenced a separate action for rescission.

The applicants argued they were innocent third parties whose rights under the bonds could not be defeated by the alleged fraud of the principals.

The court dismissed the applications, finding that the applicants' rights were derivative of the principals and that rescission remained a possible equitable remedy that must be determined on a full factual record at trial.

The applicant insurers applied for judicial review of an Umpire's decision under s. 128(3) of the Insurance Act regarding the value of a loss following a house fire.

The Umpire valued the Actual Cash Value at $338,800, which significantly exceeded both the insured's appraisal of $210,000 and the insurer's appraisal of $185,000.

The Divisional Court found the Umpire's decision unreasonable as it exceeded the range of possible acceptable outcomes and lacked reasons to justify the departure from the policy provisions.

The decision was set aside and the matter remitted to a new Umpire.