Jeremy Millard

Shareholder plaintiffs commenced an action alleging that directors and officers of a publicly traded corporation engaged in improper transactions and that certain third parties knowingly assisted in those transactions.

The moving defendants sought to strike the statement of claim, arguing that the claim improperly sought recovery for losses suffered by the corporation and therefore required leave to proceed as a derivative action under s. 246 of the Ontario Business Corporations Act.

The court held that the plaintiffs’ claim, which sought disgorgement of funds to the corporation, was fundamentally derivative in nature and could not proceed as an oppression claim in the circumstances of a large publicly traded corporation.

The court distinguished appellate authority permitting overlap between oppression and derivative remedies in closely held corporations.

The statement of claim was struck without prejudice to the plaintiffs applying for leave to bring a derivative action.

The defendant auditor brought motions to compel answers to written discovery questions, to compel production of the plaintiff's expert files, and to increase the quantum of security for costs.

The court dismissed the motion to compel discovery answers, finding the requests for summaries of evidence and lists of documents to be relied upon at trial were overly broad and disproportionate.

The court ordered reciprocal production of prior expert report drafts but otherwise upheld litigation privilege over the experts' files.

The court granted the motion to increase security for costs, adding $577,995 to the previous order due to an extended trial estimate and the plaintiff's new litigation financing arrangement.

The moving party defendant brought a motion to withdraw deemed admissions resulting from its failure to respond to a Request to Admit served nearly two years prior.

At the time of service, the defendant was unrepresented and insolvent, but subsequently obtained insurance coverage and new counsel.

The court applied the three-part test for withdrawing admissions and found that the withdrawal raised a triable issue, there was a reasonable explanation for the change in position, and the plaintiff would not suffer non-compensable prejudice.

The court granted the motion to withdraw the admissions and allowed the defendant to amend its pleadings, with no order as to costs.

The defendant, Frank Jonkman and Sons Limited, brought a motion to withdraw deemed admissions resulting from its failure to respond to a Request to Admit served nearly two years prior.

At the time of service, the defendant was unrepresented and insolvent.

The defendant subsequently obtained insurance coverage and new counsel, who discovered the unresponded Request to Admit shortly before trial.

The court applied the three-part test under Rule 51.05 and granted leave to withdraw the admissions, finding that the change raised a triable issue, there was a reasonable explanation for the change in position, and the plaintiff would not suffer non-compensable prejudice.

The defendant was also granted leave to amend its pleadings.

Following the refusal of an interlocutory injunction sought by the landlord applicants to compel a hotel operator to continue operating a hotel under a particular brand, the court determined the issue of costs.

The applicants argued that an indemnity clause in a lease entitled them to full indemnity costs from a former tenant alleged to have breached the lease.

The court held that the indemnity clause did not permit the landlord to recover litigation costs from a prior tenant where the present tenant supported the motion and where the lease’s procedures regarding a change of operating name had not been followed.

Even if the clause applied, the court would decline to exercise its discretion to award costs to the applicants.

Costs were awarded instead to the successful respondent hotel operator.

The applicants sought an interlocutory injunction compelling a hotel operator to continue managing and branding a hotel under a particular brand pending determination of a permanent injunction application.

They argued the lease required continued operation of the hotel using the brand and associated operational infrastructure despite expiry of the hotel management agreement.

The court applied the RJR‑MacDonald test and held that the lease provisions did not clearly impose an obligation requiring the operator to continue providing the full operational benefits of the brand.

The alleged harm, primarily reduced participation rent and potential reputational impacts, was found to be quantifiable and compensable in damages.

The balance of convenience favoured the operator, which would otherwise be compelled to operate a business relationship it no longer wished to maintain.