Douglas G. Garbig

The bankrupt company's creditors appealed an order dismissing their motion under s. 135(5) of the Bankruptcy and Insolvency Act to challenge a proof of claim filed by a judgment creditor.

The proof of claim was based on a Singapore judgment.

The creditors argued that the judgment creditor received payments from a third party that should be set off against the judgment debt to prevent double recovery.

The Court of Appeal dismissed the appeal, holding that the creditors did not have an unqualified right to challenge a valid judgment debt under s. 135(5).

The court further held that the creditors were privies of the bankrupt company and were barred by the doctrine of res judicata from re-litigating the mitigation and set-off issues, which had already been determined in the Singapore proceedings.

The appellants sued their former solicitor for negligence, alleging he failed to properly calculate their damages in a real estate action and negligently advised them to accept a settlement.

The trial judge dismissed the claim and awarded the solicitor substantial indemnity costs from the date of a settlement offer.

On appeal, the Court of Appeal upheld the dismissal, finding that even if the solicitor misunderstood the damages calculation, the settlement amount was a fair compromise and the appellants suffered no damages.

However, the Court allowed the costs appeal, reducing the trial costs to a partial indemnity basis, as the negligence claim was not frivolous and did not constitute misconduct.

The Liquidator of the Christian Brothers of Ireland in Canada appealed a motions judge's refusal to approve a $495,495 premium on the legal fees of its counsel, WeirFoulds LLP.

The law firm had acted on a contingency-like basis when the estate became insolvent, successfully recovering $19 million for the estate to compensate victims of child abuse.

The Court of Appeal allowed the appeal, finding that the motions judge erred by failing to consider the significant financial risk assumed by the law firm, the Liquidator's business decision to approve the premium, and the non-opposition of the victims' representative counsel.

The premium was deemed reasonable and approved in full.

This appeal concerned the interpretation of a will where the named remainderman died before the life tenant.

The court held that the devise to the sister was incapable of taking effect within the meaning of s.27 of the Wills Act and, absent contrary intention, was swept into the residue.

Reading the will as a whole, the court found the testator intended the ultimate beneficiaries to be the sister and her heirs, and not to enlarge the widow’s interest beyond a lifetime right of occupation.

The appeal was allowed and a declaration issued that the property passed to the sister’s estate.