Jeffrey Larry

The appellants appealed a decision of the Ontario Securities Commission finding them liable for insider trading and tipping contrary to s. 76 of the Securities Act.

The Commission found that a corporate lawyer tipped an investment advisor about three corporate transactions, who then tipped others in a chain.

The Divisional Court upheld the findings against the lawyer and three of the investment advisors, finding the Commission's inferences from circumstantial evidence were reasonable.

However, the court allowed the appeal of one investment advisor at the end of the chain, finding the Commission made factual errors in concluding he ought reasonably to have known the information came from an insider.

The sanctions against the unsuccessful appellants were upheld.

The appellant sought leave under s. 215 of the Bankruptcy and Insolvency Act to sue a litigation committee for defamation regarding a report sent to s. 38 litigation participants.

The motion judge dismissed the motion, finding the words were not defamatory and were protected by qualified privilege.

On appeal, the appellant sought to introduce fresh evidence that the report was sent to non-participants.

The Court of Appeal dismissed the appeal and the fresh evidence application, upholding the finding that the words were not defamatory and noting the appellant had no reputation to protect among the recipients.

The appellants, a terminated insurance agent and his company, appealed the dismissal of their claim against Sun Life for post-termination commissions under the Commissions on Release (CORe) program.

The CORe agreements stipulated that payments would cease if the agent induced clients to replace their policies.

The appellant transferred over 600 clients to a new business, prompting Sun Life to terminate the payments.

The Court of Appeal held that the termination clause was an enforceable forfeiture provision, not a penalty, and that the appellants were not entitled to equitable relief from forfeiture given their flagrant breach of the agreement.

The Ontario Securities Commission issued its decision on sanctions and costs following a merits decision that found the respondents contravened the Securities Act by engaging in insider trading and tipping.

The respondents included a mergers and acquisitions lawyer who instigated the tipping scheme and several investment advisors who traded on and further disseminated the material non-public information.

The Commission imposed 10-year trading bans, permanent or 10-year director and officer bans, and 10-year registration bans for the investment advisors.

The Commission also ordered disgorgement of profits totaling $84,698, administrative penalties totaling $2,150,000, and costs of $500,000 apportioned among the respondents based on their respective culpability and involvement in the proceedings.

The plaintiffs, former insurance advisors affiliated with a large financial services company, sought payment of monthly “CORe” commissions following termination of their advisory agreements.

The agreements provided that post‑termination commissions would cease if the advisor advised, counselled, or induced clients to replace or cancel policies serviced through the company.

The defendant argued the plaintiffs breached those conditions by soliciting and transitioning hundreds of clients and significant assets to a competing business after termination.

The court held that CORe payments were conditional incentives rather than vested compensation and found that the plaintiffs had engaged in systematic replacement activities contrary to the agreements.

Relief from forfeiture and equitable claims such as quantum meruit were rejected, and the action was dismissed.

Following a trial where the plaintiff was awarded $225,000 in damages arising from an asset purchase agreement, the court determined the issue of costs.

The plaintiff sought $172,362 in costs on a substantial indemnity basis, relying on a Rule 49 offer to settle.

The court found the offer did not comply with Rule 49 as it was made only three days before trial.

The court awarded the plaintiff partial indemnity costs, fixing the amount at $80,000 after finding the hours claimed by the plaintiff's counsel were excessive compared to defence counsel.

The applicant son sought to have the deceased's pre-death transfer of the family home to her husband and children clawed back into her estate as a 'gift mortis causa' under s. 72(1)(a) of the Succession Law Reform Act, to satisfy his dependent support claim.

The deceased had transferred the property as joint tenants shortly after being diagnosed with terminal cancer.

The court dismissed the application, finding that the transfer was absolute rather than conditional on her death, and noted that the doctrine of donatio mortis causa generally does not apply to real property.

The plaintiff sold her real estate business to the defendants under an Asset Purchase Agreement.

Shortly after the defendants took over operations, two key agents resigned.

The defendants refused to close the transaction, alleging the plaintiff misrepresented the agents' contentedness and failed to provide their employment contracts, but the defendants continued to operate the business.

The court found the defendants breached the agreement, holding that the Entire Agreement clause precluded reliance on any alleged pre-contractual misrepresentations.

The plaintiff was awarded $225,000 in damages, representing the unpaid purchase price and an estimated persistency bonus.

The plaintiff, who was previously investigated for stock fraud and entered into a settlement agreement with the Ontario Securities Commission, sued 67 defendants for malicious prosecution, negligent investigation, and other torts.

Ten motions were brought by 64 defendants to strike the pleadings and dismiss the actions.

The court dismissed the action against the Attorney General of Ontario because the malicious prosecution claim could not succeed, as the criminal proceedings were stayed pursuant to a settlement and thus not terminated in the plaintiff's favour.

The actions against the remaining moving defendants were dismissed as an abuse of process because they attempted to re-litigate facts already settled or judicially determined in prior proceedings.

The moving parties sought an adjournment of a scheduled merits hearing regarding insider trading and tipping allegations, arguing that their expert consultant had lost approximately 600 hours of work product.

Staff opposed the adjournment and brought a cross-motion to sever the matter against one respondent if the adjournment was granted.

The Commission dismissed the adjournment motion, finding that the expert consultant was sufficiently prepared to assist counsel with cross-examinations and that the matter, which had been outstanding for four years, needed to proceed in a timely manner.

The cross-motion for severance was also dismissed.

Investors who were customers of a bank alleged negligence after advancing funds to entities engaged in a cheque‑kiting scheme whose accounts had been frozen by the bank.

They claimed the bank knew of the fraudulent activity and failed to disclose material information during communications with them, while applying the advanced funds to reduce the fraudster’s indebtedness to the bank.

The bank moved under Rule 21.01(1)(b) of the Rules of Civil Procedure to strike the negligence claim for disclosing no reasonable cause of action.

Applying the Anns/Cooper framework and the test on motions to strike, the court held it was not plain and obvious that the claims had no reasonable prospect of success.

Given the pleaded bank‑customer relationship and alleged communications between the bank and its customers, the negligence claim was at least analogous to recognized categories of proximity.

Staff of the Ontario Securities Commission sought sanctions and costs against the respondents following an Agreed Statement of Facts in which the respondents admitted to unregistered trading, illegal distribution, and making misleading statements.

The respondents, acting as a transfer agent, mailed over 10,000 letters to investors falsely claiming an unpaid dividend to induce warrant exercises.

The Commission ordered permanent trading and market prohibitions against the directing mind and his companies, along with a $100,000 administrative penalty.

A lesser five-year prohibition and $2,500 penalty were ordered against his wife, who acted as a nominee director.

The respondents were also ordered to pay $60,000 in costs.

The applicant purchaser sought to void a commercial real estate transaction and recover $5.913 million from the respondent vendor, claiming the vendor failed to provide a copy of an environmental Director's Order prior to closing as required by s. 197 of the Environmental Protection Act.

The court dismissed the application, finding on a balance of probabilities that the vendor did provide the order.

Alternatively, the court held that the applicant was estopped from voiding the transaction because its solicitors had represented to the vendor prior to closing that they had no outstanding concerns regarding the receipt of the order.

Following dismissal of a counterclaim after a five‑day trial, the successful defendants by counterclaim sought costs on a partial indemnity basis.

The self‑represented counterclaimant made no submissions on costs despite being given multiple opportunities.

Applying the principle that costs should generally follow the event and must be fair and reasonable, the court found no reason to depart from the “loser pays” rule, particularly where the counterclaim lacked merit and caused unnecessary delay.

The court accepted the reasonableness of the hours claimed by counsel given the length of the trial and circumstances, including wasted court time caused by adjournments sought by the counterclaimant.

Costs were awarded to both successful parties on a partial indemnity basis.

The court determined costs following the dismissal of a motion seeking to add additional defendants under Rules 5.04 and 26.01 of the Rules of Civil Procedure.

Proposed defendants sought recovery of their legal costs incurred responding to the unsuccessful motion.

The court assessed the reasonable costs expected for a half‑day motion involving complex issues of privity of contract but reduced the amounts claimed due to unnecessary costs arising from arguments raised or abandoned during earlier proceedings.

The court also considered the absence of responding evidence and the reasonableness of counsel’s hourly rates.

Costs were awarded to the proposed defendants in reduced amounts.

The plaintiff moved to amend its statement of claim to add several limited partners of a limited partnership as defendants in an action concerning repayment obligations connected to a promissory note and related agreements.

The proposed amendment alleged that the limited partners were liable through assumption agreements tied to the limited partnership’s debt obligations.

The court considered whether the plaintiff had a tenable cause of action based on privity of contract or under Rule 8 of the Rules of Civil Procedure permitting claims against limited partners.

The court held that the plaintiff lacked privity of contract with the limited partners and that Rule 8 is procedural and does not create substantive liability for limited partners.

As the proposed claims were clearly impossible of success, the motion to amend was dismissed.

The plaintiff by counterclaim alleged that his brokerage and stockbroker made unauthorized trades in his margin account involving highly risky derivative securities during a period of extreme market volatility, causing substantial losses and forcing him to sign a promissory note.

The court examined the relationship between a broker and client and whether a fiduciary duty arose.

The evidence showed the account was non‑discretionary, the investor was knowledgeable, and the trades were executed on the client’s instructions.

The court found the investor’s testimony not credible and concluded that the losses resulted from authorized trading decisions during volatile market conditions.

The brokerage and broker breached no contractual, fiduciary, or regulatory duties.

The applicants, a group of companies owned by Dondeb Inc., sought an Initial Order under the Companies' Creditors Arrangement Act (CCAA) to enable an orderly liquidation of their assets.

The application was opposed by approximately 75% of the secured creditors, who argued for individual receiverships due to a lack of confidence in the applicants' principal and the burden of CCAA administrative costs.

The court dismissed the CCAA application, finding it unlikely that a successful plan could be developed and approved by the creditors.

Instead, the court issued a Global Receivership Order, which was supported by the opposing creditors, to achieve an orderly liquidation at a lower cost.

In a complex Commercial List case management proceeding involving multiple condominium corporations, lenders, and other parties arising from alleged fraud related to loans arranged for condominium corporations, the court addressed whether a previously scheduled separate hearing of a threshold issue should proceed.

The threshold issue concerned whether certain loans were enforceable against the condominium corporations.

Several parties withdrew their earlier consent to bifurcate the proceedings under Rule 6.1.01 of the Rules of Civil Procedure.

The court held that, absent unanimous consent, it lacked jurisdiction to compel a separate hearing of the threshold issue and therefore cancelled the proposed hearing.

The court instead directed that the actions proceed expeditiously to a consolidated trial with a structured discovery process and encouraged mediation.

The applicants, who invested approximately $15 million in the respondent companies, sought the appointment of a receiver following defaults on loans and breaches of a forbearance agreement.

The respondents had agreed to the appointment of a monitor and provided consents to a receivership held in escrow, but subsequently failed to provide the monitor with unfettered access to financial records, delayed adding the monitor as a bank signatory, and made preferential payments to the principal's family members.

The court found that the respondents materially breached the forbearance agreement and side letter, making it just and convenient under section 101 of the Courts of Justice Act to appoint a receiver over all three respondent companies.