Jessica A. Kimmel

In a joint cross-border insolvency trial concerning the allocation of approximately $7.3 billion in lockbox funds from the sale of global business lines and residual intellectual property, the court interpreted the Master R&D Agreement as an operating transfer-pricing document that granted limited licence rights but did not govern post-insolvency allocation.

The court rejected both the position that one Canadian debtor owned all sale proceeds by virtue of legal title and the position that the EMEA debtors jointly owned all intellectual property by operation of law.

Applying unjust enrichment principles and the broad remedial jurisdiction available in CCAA proceedings, the court held that a just result required a pro rata allocation among debtor estates based on allowed claims.

The court further directed that duplicate claims be counted only once for allocation purposes, that intercompany claims be included, and that interim distribution proposals be brought forward.

The plaintiffs sought leave to appeal a costs decision where the motion judge ordered each party to bear their own costs of a certification motion due to the novelty of the issues under s. 31(1) of the Class Proceedings Act.

The plaintiffs argued that s. 31(1) should operate asymmetrically in favour of plaintiffs and not shield unsuccessful defendants from costs.

The Divisional Court dismissed the motion for leave, finding no conflicting decisions and no serious reason to doubt the correctness of the motion judge's decision, as there is no rule requiring s. 31(1) to be applied asymmetrically.

The defendant, AT Plastics Inc., sought leave to appeal to the Divisional Court from an order dismissing its appeal of a Master's discovery ruling.

The Master had ruled that the plaintiff, IPEX Inc., was not required to answer certain questions or produce documents regarding its insurers' involvement in a prior $125 million class action settlement.

The court found reason to doubt the correctness of the decision, noting that the private insurance exception may have been incorrectly applied as a complete bar to obtaining relevant information from the insurers.

Finding the issue to be of general importance, the court granted leave to appeal.

In the context of the global insolvency of Nortel Networks, the UK Pension Claimants (UKPC) asserted multiple claims against the Canadian debtors (NNC and NNL).

The UKPC claimed for a contingent Financial Support Direction (FSD) under UK pension law, amounts under a Funding Guarantee and a Swift Guarantee, and remedies for oppression and unjust enrichment.

The court dismissed the FSD claim as too remote and speculative to constitute a provable claim in the CCAA proceedings.

The court also dismissed the claims under the Swift Guarantee, oppression, and unjust enrichment.

However, the court allowed the UKPC's claim under the Funding Guarantee, finding NNL liable for £339.75 million.

Following the dismissal of the plaintiffs' action, the court assessed the costs payable to the successful defendants on a substantial indemnity basis.

The plaintiffs had settled costs with the Accountant Defendants for $550,000.

The court reviewed the bills of costs submitted by the Lawyer Defendants, the Katz Defendants, and the Leikin Group Inc. The court made several reductions to the amounts claimed, noting issues with top-heavy staffing, excessive time spent on documentary discovery, and duplication of effort.

The court ultimately awarded substantial indemnity costs totaling $2,340,485.75 across the three remaining sets of defendants.

The plaintiffs, selling shareholders in a family-owned group of companies, brought an action against the non-selling shareholders, the companies' lawyers, and accountants.

They alleged breach of fiduciary duty, oppression, and knowing assistance arising from a share redemption transaction.

The plaintiffs claimed the defendants failed to disclose material information regarding the potential sale of a core asset to a third party at a higher value.

The court dismissed the action, finding that the share redemption was a product of self-interested negotiations where both sides had independent advice.

No ad hoc fiduciary duty was owed by the non-selling shareholders, lawyers, or accountants to the plaintiffs, and the plaintiffs' expectations were not reasonable under the oppression remedy.

Two related applications arose from a commercial arbitration concerning a Liquidity Payment obligation under a financing arrangement between a dairy company and a pension fund.

The moving party sought to set aside a final arbitral award under s. 46(1) of the Arbitration Act, 1991, alleging breaches of procedural fairness and arguing the arbitrator’s contractual interpretation was unreasonable.

The court held the arbitration process was fair, the parties had adequate opportunity to present their cases, and the arbitrator’s interpretation of the Liquidity Payment Agreement was consistent with its plain language.

The application to set aside the award was dismissed.

The responding party’s application to enforce the arbitral award and supplementary costs award was granted, with interest fixed at 3% in accordance with the contract and applicable statutory rates.

Following the dismissal of the defendants’ motion for summary judgment, the court determined the appropriate costs payable to the successful plaintiff.

The defendants had succeeded on one of four principal issues, resulting in partial success that justified a reduction in the plaintiff’s recoverable costs.

The court considered the proportional success of the parties and the relative time and resources expended by counsel.

Applying reductions for both partial success and excessive docketed time, the court fixed costs at a fair and reasonable amount under Rule 57.01.

The defendants brought a summary judgment motion seeking dismissal of a commercial action alleging defective raw materials supplied for thermoplastic piping systems.

They argued the claims under an earlier supply agreement were barred by the Limitations Act and that liability disclaimers in later agreements excluded all contractual and tort liability.

The court held the limitation period for the indemnity claim had not expired because the claim arose only after the plaintiff was served with underlying litigation relating to the alleged defects.

While the contractual disclaimers were sufficient to exclude liability for negligence, they did not clearly exclude the statutorily implied condition of fitness for purpose under the Sale of Goods Act.

The court also found that alleged post‑contractual conduct potentially modifying the agreements raised a genuine issue requiring a trial.

Summary judgment was therefore refused and the action allowed to proceed.

The appellant commenced a proposed class action asserting a statutory cause of action under s. 130 of the Securities Act for misrepresentations in a prospectus.

The motion judge found the claim was barred by the limitation period in s. 138 of the Securities Act and was not saved by the suspension of limitation periods in s. 28 of the Class Proceedings Act.

The Court of Appeal upheld the decision, finding that a prior class action appeal did not encompass the s. 130 claim, meaning the suspension of the limitation period ended when the time to appeal the dismissal of that specific claim expired.

The plaintiffs brought a proposed class action against mutual fund managers for permitting market timing, which allegedly caused losses to long-term investors.

The defendants had previously entered into settlement agreements with the Ontario Securities Commission (OSC) regarding the same conduct.

The motion judge dismissed the certification motion, finding the OSC proceedings were the preferable procedure.

The Divisional Court allowed the plaintiffs' appeal.

The Court of Appeal dismissed the defendants' appeal, holding that the OSC proceedings were regulatory and lacked participatory rights for investors, and therefore did not fulfill the access to justice goals of the Class Proceedings Act.

The class action was deemed the preferable procedure.

The appellant appealed a trial judgment granting declaratory relief that limited the respondent's obligation to indemnify the appellant for royalties payable under a net smelter return royalty agreement.

The trial judge found the indemnification obligation was limited to a flat rate of 0.013% NSR, as indicated in the schedules to the purchase agreements, rather than the sliding scale royalty actually required by the underlying agreement.

The Court of Appeal dismissed the appeal, upholding the trial judge's conclusion that the specific references to the 0.013% NSR rate reflected the parties' intention and overrode general references to assuming all obligations.

The Supreme Court of Canada considered a proposed plan of arrangement for a leveraged buyout of BCE Inc. that would add substantial debt to Bell Canada, reducing the trading value of its debentures.

The debentureholders opposed the arrangement, claiming oppression under s. 241 of the CBCA and arguing the arrangement was not fair and reasonable under s. 192.

The Court held that the directors' fiduciary duty is owed to the corporation, not to specific stakeholders, though directors may consider stakeholder interests.

The debentureholders failed to establish a reasonable expectation that their investment grade rating would be maintained.

The Court affirmed the trial judge's approval of the arrangement, finding it had a valid business purpose and resolved objections in a fair and balanced way.

The appellants brought a class action for prospectus misrepresentation under s. 130(1) of the Ontario Securities Act.

The respondent company made an initial public offering with a prospectus containing a sales forecast.

Before the offering closed, internal analysis showed sales lagging due to unseasonably warm weather, but this was not disclosed.

The Supreme Court of Canada held that the company had no obligation to disclose the intra-quarterly results because they did not amount to a 'material change' under the Act.

The Court also held that the Business Judgment Rule does not apply to statutory disclosure obligations.

The appeal was dismissed with costs.

The appellants sought costs of the appeal and trial on a partial indemnity basis following their success.

The respondent argued for no costs, asserting the class proceeding raised a novel point of law and involved a matter of public interest.

The Court of Appeal rejected this argument, finding the litigation was a commercial dispute between sophisticated actors involving established principles.

The court awarded costs of the appeal fixed at $100,000 plus GST to both the individual and corporate appellants, along with disbursements, and ordered trial costs to be assessed on a partial indemnity basis.

The appellants appealed a trial judgment finding them liable for prospectus misrepresentation under s. 130(1) of the Securities Act.

The trial judge had held that the appellants had a continuing obligation to disclose poor intra-quarterly financial results before the closing of their initial public offering, and that their failure to do so rendered an implied representation of objective reasonableness in their financial forecast false.

The Court of Appeal allowed the appeal, holding that the Act distinguishes between material facts and material changes, and imposes no continuing obligation to disclose material facts after a prospectus receipt is issued.

The Court further held that the trial judge erred in implying a representation of objective reasonableness and in failing to apply the business judgment rule to management's assessment of the forecast.

The applicants sought to vary management cease trade orders (MCTOs) under section 144 of the Securities Act to permit trading in connection with a proposed going private transaction by Hollinger Inc. The Commission found that the applicants failed to demonstrate that varying the MCTOs would not be prejudicial to the public interest.

The Commission cited concerns regarding the lack of current audited financial statements, the adequacy of the independent valuation, the potential conflicts of interest in the proposed litigation trust, and evidence of undue influence exerted by related parties on the independent committee and valuator.

The applications were denied.

The applicant brought a motion requesting the Hearing Panel reconsider a prior panel's decision dismissing a motion to strike certain words from the Statement of Allegations.

The Hearing Panel found it had no jurisdiction to review the prior decision under section 144 of the Securities Act, Rule 9 of the Rules of Practice, or the common law doctrine of functus officio.

Even if jurisdiction existed, the panel would have dismissed the motion, finding that the inclusion of the words 'and contrary to the public interest' did not impair the applicant's right to know the case to meet.

The applicant, a respondent in an insider trading proceeding, brought a pre-hearing motion seeking a ruling that the Commission could not make a public interest order against her under section 127 of the Securities Act if Staff failed to prove the specific allegation of insider trading under section 76(1).

A prior panel had dismissed the same motion as premature.

The Hearing Panel agreed with the prior panel, holding that it was inappropriate to tie the hands of the decision-makers before hearing the evidence and closing submissions.

The motion was dismissed as premature.

The appellants appealed a trial judgment dismissing their claims regarding interests in an estate under the doctrine of mutual wills, constructive trust, and as beneficiaries of a family trust.

The trial judge found no agreement to execute mutual wills and upheld the trustee's encroachment on the trust in favour of another beneficiary, finding it was done in good faith to protect family businesses.

The Court of Appeal dismissed the appeal, holding that the trial judge's detailed findings of fact and credibility assessments were well supported by the evidence and no palpable and overriding error was demonstrated.