Kelli Preston

The appellant, 2649360 Ontario Inc., appealed a motion decision that granted Grant Thornton Limited, as Trustee in Bankruptcy for Aiden Pleterski and AP Private Equity Limited, relief from forfeiture of a $500,000 real estate purchase deposit.

The deposit was paid by Pleterski using misappropriated investor funds for a property that was subsequently not purchased due to bankruptcy.

The motion judge applied the two-part test for relief from forfeiture (disproportionate to damages and unconscionable to retain) and ordered the deposit returned to the Trustee for the benefit of creditors.

The appellant argued the motion judge erred by considering creditor interests and by characterizing Grant Thornton as "innocent." The Court of Appeal dismissed the appeal, affirming that the motion judge was entitled to consider the full commercial context, including the source of funds and the benefit to creditors, and that a party causing breach is not absolutely barred from relief from forfeiture.

The court found no error in the discretionary decision.

The Trustee in Bankruptcy of Aiden Pleterski and AP Private Equity Limited moved for relief from forfeiture of a $500,000 deposit paid by the bankrupt for a property purchase.

The deposit originated from funds misappropriated from investors.

The vendor, 2649360 Ontario Inc., sought to retain the deposit and a $300,000 surplus from the property's resale.

The court applied the two-part test for relief from forfeiture under section 98 of the Courts of Justice Act, considering whether the forfeited amount was disproportionate to damages and if retention would be unconscionable.

The court found that the vendor had suffered minimal proven damages ($138,500) and that retaining the deposit in addition to the resale surplus would result in an unconscionable windfall, especially given the massive losses suffered by the innocent investors.

The motion was granted, ordering the deposit to be paid over to the Trustee.

This is a costs endorsement following the dismissal of an appeal and a motion for fresh evidence.

The Court of Appeal for Ontario awarded costs to the respondents, Jonathan Speigel, Lawyers’ Professional Indemnity Company (LawPRO), and Garen Kassabian, payable by the self-represented appellants, Rhys Fockler and Lyn Cartwright.

The costs were set at $7,500 for Kassabian and $7,500 for Speigel and LawPRO, inclusive of disbursements and taxes.

The appellants appealed a summary judgment dismissing their action and an order refusing to set it aside, arguing errors in the limitation period finding and their absence from the summary judgment hearing.

They also sought to introduce fresh evidence.

The Court of Appeal dismissed the motion for fresh evidence, finding it lacked due diligence and would not have affected the outcome.

The court upheld the motion judge's finding that the action was statute-barred, as a reasonable person would have discovered the claim shortly after closing, despite the appellants' claim of late discovery of the reporting letter.

The plaintiff entered into an unwritten real estate arrangement orchestrated by a third-party broker, whereby she obtained mortgage financing to purchase a property from power of sale proceedings, allowing the former owner to live there and potentially repurchase it after one year.

When the year expired, the former owner failed to secure financing to repurchase the property.

The court held that the plaintiff retains full title to the property and is entitled to vacant possession.

The court also found that the broker breached his duty of care by failing to document the arrangement or advise the parties to seek legal counsel, making him liable for the plaintiff's costs and for $20,000 to the former owner.

Furthermore, the court ordered the removal of a third mortgage fraudulently registered against the property by another defendant.

This decision concerns a costs award following a partition and sale application where the court had previously found divided success.

Both parties sought costs, but the court dismissed both claims.

The court determined that there was no conduct warranting a punitive costs award, and the offer to settle made by one party was untimely and not more favourable than the court's decision.

Consequently, the court made no order as to costs.

Michelle Ng and Eric Tang, former romantic partners and joint tenants of a condominium, both applied under the Partition Act to end their co-ownership.

Ng sought to purchase Tang's interest, arguing for an unequal distribution based on her significant after-purchase contributions, claiming unjust enrichment.

Tang sought a sale with 50:50 division after accounting for a mortgage he placed on the property and Ng's payment of occupation rent.

The court ordered partition and sale, dismissing both Ng's unjust enrichment claim for unequal distribution and Tang's claim for occupation rent.

The proceeds are to be divided 50:50 after Tang discharges his mortgage and pays Ng his share of her after-purchase contributions.

Sutherland Law appealed two orders from the Superior Court of Justice: a Directions Order and a Charging Order.

The plaintiff, Pasquale Scetto, moved to quash the appeal of the Directions Order due to Sutherland Law's lack of standing and sought dismissal of the Charging Order appeal, arguing no fund existed for a charging order.

The Court of Appeal granted the motion to quash the appeal of the Directions Order, finding Sutherland Law lacked standing as it was no longer counsel of record and was not a party to the Directions Motion.

Consequently, with the Directions Order standing (which determined the defendant's share of net sale proceeds was $0), the appeal of the Charging Order was dismissed as there was no fund over which a charging order could be made.

Costs were awarded to the plaintiff.

This endorsement addresses two motions: a charging order sought by Sutherland Law (former counsel for the defendant) for unpaid legal fees, and a motion for directions by the plaintiff regarding the calculation of proceeds from a property sale as per a prior judgment.

The court dismissed the charging order motion, finding no existing fund in the defendant's favour after applying the judgment's formula.

The court accepted the plaintiff's calculations, which determined the defendant's share to be nil, and ordered costs against Sutherland Law and the defendant.

The appellants appealed from a motion judge's order dismissing their motion seeking a declaration that a default judgment against the respondent Chris Mace survived his bankruptcy under sections 178(1)(d) and 178(1)(h) of the Bankruptcy and Insolvency Act.

The appellants obtained a default judgment by having the Registrar sign it under Rule 19.04 of the Rules of Civil Procedure, which is limited to claims for "a debt or liquidated demand in money." The Court of Appeal upheld the motion judge's decision, finding that the generic pleadings in the statement of claim were insufficient to establish the type of misconduct required for exemption under section 178(1)(d), and that the motion judge was not required to go beyond the pleadings to make fresh findings of fact.

The plaintiff brought a motion for summary judgment seeking damages after the defendant failed to close on an agreement of purchase and sale for a residential property.

The defendant had requested multiple extensions and a price reduction but ultimately failed to obtain financing.

The plaintiff subsequently sold the property to another buyer for a lower price.

The court granted summary judgment, finding a clear breach of contract, and awarded the plaintiff $79,014.94 in damages for the difference in sale price and carrying costs, though it declined to award damages related to the plaintiff's mortgage defaults.

The replacement trustee in bankruptcy brought a motion for a declaration that it owned the bankrupt's leased office equipment and furniture free and clear.

The bankrupt had financed the equipment through leases secured by a collateral assignment of his life insurance policies.

After his death, the insurer paid the lessor from the death benefit, which the bankrupt's spouse and daughter (the beneficiaries) argued unjustly enriched the estate.

The court held that the rule in Ex parte James did not apply to give the beneficiaries a proprietary claim against the equipment, and granted the trustee's declaration, noting the beneficiaries could pursue other remedies if they suffered a loss.

The court-appointed Receiver brought a motion to extend an ex parte Mareva injunction against the spouse of the debtors' principal and to repatriate misappropriated HST funds.

The debtors had concealed a $986,594.96 HST refund and diverted it to an account controlled by the spouse.

An intervenor claimed the funds were repayment for a loan, but the court dismissed this as a fraudulent attempt to divert the funds.

The court found the Receiver made full and frank disclosure, was not required to commence an action against the spouse first, and did not need to provide an undertaking as to damages due to the Receivership Order.

The motion was granted, the injunction extended, and immediate repatriation of the funds ordered.

Following a civil trial involving a dispute between the plaintiff and one defendant, the successful defendant sought recovery of legal costs totaling $62,762.36 based on partial and substantial indemnity, relying in part on offers to settle delivered shortly before trial.

The plaintiff conceded entitlement to costs but argued the amount claimed was excessive and that certain docketed time, including attendance of a student at trial, was unnecessary.

The court found the case relatively simple and rejected the request for substantial indemnity costs based on late offers to settle.

However, the court held the plaintiff’s conduct at trial warranted more than partial indemnity costs.

A lump sum costs award of $47,000 inclusive was fixed and ordered payable within 30 days.

The plaintiff sued a lawyer, alleging the lawyer acted for him on a mortgage transaction and breached trust obligations by disbursing $70,000 of the proceeds to a third party instead of the plaintiff.

The court dismissed the claim against the lawyer, finding that the plaintiff was actually represented by his spouse, who was also a lawyer, and that the defendant lawyer had followed instructions to disburse the funds.

The court made strong adverse credibility findings against the plaintiff and his spouse.

Judgment was granted against the third party who received the funds.

Multiple defendants brought motions seeking security for costs against a plaintiff who was ordinarily resident outside Ontario in two related civil actions.

The plaintiff argued impecuniosity and contended that an order for security would effectively drive him from the litigation.

The court held that the plaintiff failed to meet the high evidentiary threshold required to establish impecuniosity because he provided outdated financial disclosure and did not produce complete, current documentation regarding income, assets, liabilities, and borrowing capacity.

Finding the requested security amounts reasonable given the anticipated complexity and duration of the litigation, the court ordered the plaintiff to post security for costs in both actions, failing which the proceedings would be stayed.