Joshua Suttner

The appellants appealed a summary judgment granted to TD Bank on a loan and guarantees.

The appellants argued the motion judge erred by allowing a non-party to testify in a mini-trial, making findings of fact relevant to a third-party claim, and granting summary judgment before the third-party claim was determined.

The Court of Appeal dismissed the appeal, finding no error in the motion judge's exercise of enhanced powers under Rule 20.04(2.2) or in granting summary judgment, as the third-party claim was separate and the appellants had opportunities to join it.

This is a costs endorsement following an appeal where the appellants (defendants) successfully challenged the sanction (judgment in the action) imposed by the motion judge for contempt, due to procedural flaws.

The Court of Appeal upheld the initial costs award for the contempt finding, but set aside the costs for the sanctions hearing and the action, and ordered no costs for the appeal, acknowledging the appellants' underlying contemptuous conduct as the root cause of the proceedings.

The appellants, found in contempt for multiple failures to disclose assets and account for misappropriated investment funds, appealed the motion judge's decision to grant judgment against them for approximately $9 million as a sanction for contempt.

The Court of Appeal held that while striking a defence or barring participation can be a sanction for contempt, final judgment is not directly available as a punishment for contempt under Ontario's Rules of Civil Procedure.

The Court found that the motion judge erred by relying on the merits of the action to grant judgment while simultaneously barring the appellants from addressing those merits.

The judgment was set aside, and the matter remitted to a different judge for a new sentencing hearing.

The plaintiff in a wrongful dismissal action brought a motion for production of the defendant's financial records, alleging the defendant fabricated cause for termination as a cost-saving measure during the COVID-19 pandemic.

The defendant brought a cross-motion for production of the plaintiff's employment insurance records to respond to her claim of financial distress.

The court dismissed the plaintiff's motion, finding the financial records were not relevant to proving the defendant's alleged bad faith agenda.

The court granted the defendant's cross-motion, holding that because the plaintiff put her financial pressure in issue, her income sources, including employment insurance, were relevant.

The appellants, having been found in contempt of a Mareva injunction and ordered to pay approximately $9 million to the respondents, appealed the judgment.

In this endorsement, the Court of Appeal addressed two motions: the respondents' motion for security for costs of the appeal and the proceeding, and the appellants' cross-motion for a stay of a judgment debtor examination order.

The court granted the respondents' motion for security for costs in part, finding the appellants' contempt a compelling reason under Rule 61.06(1)(c).

The court dismissed the appellants' motion for a stay, determining that the examination order was not automatically stayed and that compliance would not cause irreparable harm given the appellants' existing obligations to disclose assets.

The moving parties (Fibracast Ltd., Anaergia Inc., Anaergia Services, LLC, Benedek Companies, LLC, and Diana Benedek) brought a motion to strike out parties, claims, and pleadings from Waterspin S.r.l.'s amended defence and counterclaim.

The underlying dispute arose from a Distributor Agreement between Fibracast and Waterspin.

Waterspin's counterclaim included broad allegations of enterprise liability against related corporate entities and personal liability against a corporate officer, as well as expansive product liability, misrepresentation, and defamation claims.

The court granted the motion to strike, finding that Waterspin failed to plead sufficient material facts to pierce the corporate veil or establish enterprise liability.

The court also struck out the overly broad product liability claims, declaratory relief, misrepresentation claims, and defamation claims for failing to meet pleading requirements, granting leave to amend only in specific, limited circumstances.

The plaintiff, an unsophisticated lender, brought a motion for summary judgment to recover unpaid loans made to the defendants.

The defendants argued the acknowledgment of debt was unconscionable due to a 60 percent interest rate and lack of legal representation, and denied fraudulent misrepresentation.

The court granted summary judgment, finding no unconscionability as the defendant had proposed high interest rates initially and refused legal counsel.

The court also found the defendant engaged in fraudulent misrepresentation regarding the company's finances to induce the initial loans, awarding the plaintiff the principal amounts plus 60 percent interest.

The plaintiffs sought penalties against the defendants for their continued contempt of court orders requiring them to provide an accounting of $9,000,000 in allegedly defrauded funds, information about luxury automobiles, contact information, and disclosure.

The court found that the defendants had not purged their contempt and provided implausible explanations for their non-compliance.

As a penalty, the court granted judgment against the defendants, striking their ability to defend the action, and awarded substantial indemnity costs to the plaintiffs.

The plaintiffs brought a motion to find the Developer Defendants in contempt of multiple court orders, including a Mareva injunction.

The plaintiffs had invested $9,000,000 with the defendants, who allegedly misappropriated the funds and failed to provide a court-ordered accounting, disclosure, and contact information.

The court applied the three-part test for civil contempt and found the Developer Defendants intentionally breached the orders by failing to provide an accounting, failing to disclose documents, actively thwarting a real estate closing, and failing to provide vehicle information.

The Developer Defendants were found in contempt, with a sanctions hearing to follow.

In the context of a complex fraud action, the court previously ordered the sale of a mortgaged property.

The First Mortgagees subsequently brought a motion seeking payment of three months' interest out of the sale proceeds.

The court dismissed the motion, finding it was barred by issue estoppel and constituted a collateral attack on the prior sale order, as the First Mortgagees failed to attend the prior hearing or produce relevant documents.

Furthermore, the court held that the claimed interest amounted to an unenforceable penalty under the Interest Act and granted relief from forfeiture under the Courts of Justice Act.

Costs were awarded to the plaintiffs on a substantial indemnity basis.

The plaintiffs sought interim orders to compel the sale of a property and non-party document disclosure, alleging oppression and fraud by the defendants.

The court applied the strong prima facie case test for the mandatory interlocutory injunction.

It found a strong prima facie case of oppression due to the defendants' breach of shareholder agreements, diversion of funds, and lack of credibility, evidenced by their non-compliance with previous court orders.

The court approved the plaintiffs' proposed sale of the property for $12 million over the defendants' $15 million offer, citing the plaintiffs' offer's certainty and the defendants' unreliability.

The court also granted the non-party production order.

The applicants sought a declaration of ownership over certain equipment and assets ("BuiltRite Assets") and an order compelling respondents to release them, asserting a first-ranking security interest.

The dispute centered on whether a Quitclaim effectively transferred ownership of "Trailered Assets" to Strongco Plastics Ltd. The respondents argued the Quitclaim lacked certainty and consideration, and that claims against the Hernandezes were stayed due to bankruptcy.

Marcelo Hernandez also cross-applied for compensation for work performed.

The court found the Quitclaim unenforceable due to lack of certainty and consideration, dismissing the applicants' claims regarding asset ownership.

The court also found ESC Enterprises Inc. unjustly enriched by Marcelo Hernandez's services and awarded him compensation.