Judy G. Hamilton

The decision addresses a motion by Martin Z. Rosenbaum and his law corporation for the recusal of the case management judge, Lorne Brownstone, in a complex, multi-party trust account litigation arising from alleged misappropriation by Vanessa Ibe.

The court reviews the history of the litigation, the role of LAWPRO, and the management of case conferences.

The motion is dismissed, with the court finding no reasonable apprehension of bias and emphasizing the need for efficient case management in the interests of all parties, especially the victims.

The decision addresses two competing motions for the appointment of representative counsel for investors in a receivership proceeding involving Sussman Mortgage Funding Inc. The court reviews the procedural background, the need for representative counsel, and the competing proposals from Aird & Berlis LLP and Paliare Roland Rosenberg Rothstein LLP.

The court ultimately appoints Aird & Berlis LLP as representative counsel, finding their approach and fee structure preferable for efficiency, transparency, and certainty.

This is a costs endorsement from the Court of Appeal for Ontario following an appeal.

The respondents (original plaintiffs) were found entitled to costs.

The court determined that costs should be awarded on a partial indemnity basis, as the appeal was not entirely without merit and the appellants' conduct was not criticized.

Costs were fixed at $12,000, inclusive of disbursements and taxes.

The appellants, a lawyer and his professional corporation, appealed a default judgment obtained against them for knowingly assisting in a client's fraud.

The Court of Appeal for Ontario confirmed its jurisdiction to hear the appeal, treating the motion judge's decision as equivalent to a refusal to set aside a default judgment.

The Court upheld the motion judge's refusal to set aside the noting in default, citing the appellants' bad faith and deliberate delay tactics.

While agreeing that the negligence claim was not properly pleaded, the Court affirmed the finding of liability for knowing assistance in fraud, based on the lawyer's issuance of a misleading "comfort letter" and the disbursement of funds from his trust account despite knowledge of the property's prior sale.

The appeal was dismissed.

The Plaintiffs brought a motion to amend their Statement of Claim to include substantial new claims for general damages, unrelated to the delay in performance of share purchase agreements.

The Defendants opposed the motion.

The court dismissed the Plaintiffs' motion, finding that the proposed amendments directly contradicted previous court orders that had delineated the scope of permissible residual claims, thereby causing uncompensable prejudice to the Defendants.

The plaintiffs, purchasers of pre-construction condominium and freehold units, brought motions for certificates of pending litigation (CPLs) against the development property after the original developer became insolvent and transferred the property to a new developer.

The purchase agreements contained non-registration clauses prohibiting the registration of CPLs.

The court found that while there was a triable issue regarding an interest in land based on constructive trust, the non-registration clauses and the equitable factors from Dhunna—including the lack of uniqueness of the property, the adequacy of damages, and the prejudice to new innocent purchasers—weighed heavily against granting the CPLs.

The motions were dismissed.

The plaintiffs brought a motion for default judgment after noting the defendants in default in an action for investment fraud.

The defendants brought a cross-motion to set aside the noting in default.

The court found that the defendants had engaged in a concerted effort to delay the proceedings and failed to provide any substantive evidence of a meritorious defence.

The court dismissed the motion to set aside the noting in default and granted default judgment to the plaintiffs, finding the primary individual defendant liable for fraudulent misrepresentation and breach of contract, and the defendant lawyer liable for negligent misrepresentation.

The plaintiffs were awarded compensatory damages, punitive damages, and substantial indemnity costs.

The defendant 2603553 Ontario Inc. ('260') brought a motion for summary judgment to dismiss a fraudulent conveyance claim by the plaintiff, Vestacon Limited.

Vestacon cross-moved for a certificate of pending litigation.

The court granted 260's motion, finding no genuine issue requiring a trial regarding 260's knowledge of any fraudulent intent on the part of Huszti Investments.

The court concluded that the sale of the units by Huszti Investments to 260 was commercially reasonable and the proceeds were used to pay secured creditors.

Consequently, Vestacon's action against 260 was dismissed, and its cross-motion for a certificate of pending litigation was also dismissed.

The court awarded substantial indemnity costs of $85,000 to 260.

The appellants, the Attorney General of Canada and the Ontario Provincial Police, appealed a motion judge's decision that the respondents' claims for malicious prosecution, negligent investigation, misfeasance in public office, and civil conspiracy were not statute-barred.

The core issue was the application of the "appropriate means" element of the discoverability test under s. 5(1)(a)(iv) of the Limitations Act, 2002.

The Court of Appeal upheld the motion judge's finding that it was premature for the respondents to commence their actions until related civil forfeiture proceedings and an appeal of a costs order (which addressed Crown misconduct) were concluded.

The appeals were dismissed, affirming that the limitation period had not expired.

The plaintiff attended a status hearing ordered by the Court of Appeal to establish a litigation timetable.

The remaining defendant argued the action should be dismissed for delay, citing the plaintiff's failure to advance the litigation since the appeal.

The court found that while the plaintiff's delay was unnecessary, it was not severe enough to warrant dismissal, especially given the defendant's own delay in delivering a statement of defence.

A litigation timetable was ordered.

The defendants moved for security for costs against the plaintiff, Forvest Financial Services Corporation, an assignee of a claim from a Swiss corporation.

The motion was brought under Rule 56.01(1)(d), alleging Forvest had insufficient assets in Ontario to pay costs.

The court applied the two-stage test from Hallum and Yaiguaje, considering all evidence, including the plaintiff's own financial disclosures.

The Master found that Forvest's assets, primarily "advances to related parties" were sheltered from execution and insufficient.

While the plaintiff demonstrated a good case on the merits regarding misappropriation of funds, a critical credibility issue concerning a limitation period argument prevented a finding of "good chance of success." No unreasonable delay was found on the defendants' part.

The court ordered Forvest to post security for costs, reducing the quantum to exclude mediation costs due to the defendants' bad faith participation and costs related to their counterclaim.

The appellant appealed an order of Justice Petersen dismissing the entire action against multiple defendants.

All respondents except Mr. Rabie consented to setting aside the order.

The Court of Appeal found that the motion judge had misapprehended the status of the action against Mr. Rabie, incorrectly believing he was no longer a defendant.

A default judgment against Mr. Rabie had been set aside in July 2017 regarding the breach of fiduciary duty claim, which was ordered to proceed to trial.

Mr. Rabie had not opposed the status motion or the litigation timetable order.

The Court allowed the appeal, set aside the dismissal order, and ordered the parties to attend a status hearing to establish a litigation timetable.

The Vendor successfully moved for summary judgment, terminating an agreement of purchase and sale due to the Purchasers' failure to pay a deposit by the stipulated deadline.

The court found that a subsequent alleged verbal agreement to revive or amend the contract was invalid, citing "time is of the essence" and "all amendments in writing" clauses within the agreement, as well as the Statute of Frauds.

Relief from forfeiture of the $1,000,000 deposit was denied, as the deposit was not deemed disproportionate to the purchase price and no unconscionability was established.

The Purchasers' cross-motion for specific performance and motion for a certificate of pending litigation were dismissed.

A seller and buyer entered into an agreement for the purchase and sale of a warehouse for $10,225,000.

The buyer intended to establish a licensed marijuana grow-op business.

The agreement provided for an initial deposit of $300,000, and the buyer paid an additional deposit of $450,000 to obtain a six-month extension of the closing date.

When the buyer failed to obtain Health Canada licensing and financing and failed to close, the seller sought to forfeit the entire $750,000 deposit.

The application judge found the forfeiture unconscionable and reduced it to $350,000.

The Court of Appeal reversed, holding that the deposit was not grossly disproportionate and that unconscionability must be an exceptional finding strongly compelled by the facts.

The court restored the full contractual forfeiture of $750,000.

The appellant, a father, appealed the trial judge's dismissal of his mortgage action against his son and daughter-in-law.

The trial judge had found the mortgage unenforceable on three grounds: duress, sham, and failure to prove advances.

The Court of Appeal reversed on the first two grounds, finding no duress and that the mortgage was not a sham.

However, the Court upheld the trial judge's finding that the father failed to prove that funds advanced through a company were made under the mortgage, as opposed to being income to the son.

The appeal was dismissed.

The appellant failed to pay support arrears and post security as previously ordered by the court as a condition of hearing the appeal.

Consequently, the appeal was dismissed on consent with agreed costs of $27,500.

The court ordered that $15,000 of the costs award be included as a support order under s. 1(1)(g) of the Family Responsibility and Support Arrears Enforcement Act, 2005, making it enforceable as a support order.

The respondent brought a preliminary motion requesting the court refuse to hear the appellant's appeal due to his failure to comply with trial orders regarding spousal support and security.

The Court of Appeal held that where an appellant wishes to be relieved of trial obligations pending appeal, the proper approach is to bring a stay motion.

The court adjourned the appeal, ordering that it would not be heard until the appellant paid the support arrears and posted the required security.

The applicant vendor sought a declaration that the purchaser was in breach of an Agreement of Purchase and Sale for commercial property and that the vendor was entitled to retain the full $750,000 deposit.

The purchaser failed to close due to lack of financing and inability to obtain a Health Canada license for its intended marijuana grow-op business.

The court found the purchaser breached its good faith obligation and had no legal justification for not closing.

However, the court granted the purchaser relief from forfeiture under Section 98 of the Courts of Justice Act, finding the total deposit of $750,000 to be unconscionable in the absence of evidence of damages suffered by the vendor.

The forfeited sum was reduced to $350,000.

The defendant corporate officer brought a Rule 21.01(1)(b) motion to strike a claim against him personally for inducing breach of contract.

The plaintiff alleged that the officer caused the corporate defendant to improperly draw on a letter of credit without the contractually required notice.

The court held that corporate officers are generally protected from personal liability unless the pleading alleges facts showing conduct outside the scope of authority or an independently actionable wrong.

The amended statement of claim contained only conclusory allegations and failed to plead sufficient material facts to establish a personal cause of action.

The claim against the officer was struck, but the plaintiff was granted leave to amend its pleading.

The moving defendant sought to set aside an earlier summary judgment on a personal guarantee arising from minutes of settlement in mortgage litigation, alleging lack of service and an irregularity because the issued order omitted a judicial sale term found in the endorsement.

The court held that alternate service at the defendant’s residence was effective under Rule 16.03(5), and that the prior ruling was a summary judgment, not a default judgment.

Applying issue estoppel principles, the court found the defendant was barred from re-litigating liability on the guarantee.

The omission of the judicial sale term did not justify setting aside the entire judgment, particularly because the properties had already been sold.

The court declined to determine on the motion whether the guarantee had been substantially satisfied, but authorized a separate application for interpretation of the minutes of settlement and an accounting.