Kellie Seaman

Following a trial judgment awarding over $16 million to the plaintiff in a commercial dispute, the court determined the appropriate costs award and prejudgment interest.

The court held that although the plaintiff’s Rule 49 offer was served slightly outside the formal timing requirements, it could still be considered under Rules 57.01 and 49.13.

Substantial indemnity costs were awarded from the date of the settlement offer and for work responding to a serious trading‑manipulation allegation later abandoned by the defendant.

However, the court found the plaintiff’s claimed hours excessive and reduced the requested fees.

The court fixed total fees at $1,400,000 inclusive of taxes, allowed disbursements of $191,813, and awarded prejudgment interest at the statutory rate from the date the cause of action arose.

The plaintiff, a junior oil and gas exploration company, sued the defendant underwriter for breach of a 'bought deal' engagement letter.

The defendant failed to close the transaction, arguing the letter was merely an agreement to agree and relying on 'out clauses' due to a drop in oil prices.

The court found the engagement letter was a binding contract and that the defendant could not rely on the out clauses, as it had not negotiated an underwriting agreement and the drop in oil prices did not constitute a material adverse change or disaster.

The plaintiff was awarded over $16 million in damages, representing the difference between the contract price and the replacement financing price, plus interim loan costs.

During the first week of trial, the defendant moved to amend its statement of defence and counterclaim to add new factual allegations and a mitigation defence relating to transactions undertaken by the plaintiff after the alleged breach of a share purchase agreement.

The court considered whether the proposed amendments disclosed a tenable defence, including arguments that damages should be assessed at the date of trial due to the plaintiff’s claim for specific performance and that subsequent transactions mitigated any losses.

The court held that damages for breach of contract would normally be assessed at the date of breach and that the proposed allegations concerning the plaintiff’s later transactions were irrelevant to the proper measure of damages.

The proposed amendments concerning the Red Willow transaction and complete mitigation did not raise a tenable defence and were refused.

The plaintiff sought leave to commence a secondary market misrepresentation action under the Securities Act and to certify a class proceeding against the defendants for misrepresentation, conspiracy, and oppression.

The plaintiff alleged that the defendants fabricated a financial crisis by including a 'going concern' note in the company's financial statements to artificially depress the share price, allowing insiders to acquire shares cheaply.

The court dismissed the motion for leave, finding no reasonable possibility of success at trial, as the financial disclosures were factual, required by GAAP, and made after reasonable investigation.

The court also refused to certify the conspiracy claim due to a lack of factual basis and struck the oppression claim, ruling that the Ontario Superior Court lacked subject-matter jurisdiction over an oppression remedy under the British Columbia Business Corporations Act.

The appellant appealed a motion judge's decision granting the respondent's motion to stay proceedings in Ontario.

The appellant argued the motion judge erred in finding Ontario had no jurisdiction based on presence or a real and substantial connection.

The Court of Appeal upheld the motion judge's application of the Muscutt factors, finding no palpable and overriding error in her factual findings or legal conclusions.

The appeal was dismissed.

Staff of the Ontario Securities Commission sought to extend a temporary cease trade order against the respondent pending the completion of an investigation into potentially illegal distributions and market manipulation involving several companies.

The Commission found sufficient evidence of conduct potentially harmful to the public interest to justify extending the order.

However, the Commission granted the respondent a restricted personal trading carve-out, subject to strict reporting conditions, as the investigation was ongoing and no Statement of Allegations had yet been issued.

The Ontario Securities Commission held a hearing to consider whether to approve a settlement agreement between Staff and several individual respondents regarding their failure to ensure that Philip Services Corp. filed financial statements containing full, true, and plain disclosure.

The Commission approved the settlement, which included reprimands, director and officer bans ranging from five to twelve years, and a collective costs payment of $500,000.

The Commission found the sanctions proportionate and in the public interest, noting the respondents' cooperation and efforts to restructure the company.

The appellant brought a motion before the Court of Appeal.

The court dismissed the motion and ordered no costs, as the responding party did not request them.

The appellant appealed decisions of the Ontario Securities Commission finding he acted as an unregistered adviser and imposing sanctions, including a $300,000 costs order, for failing to disclose conflicts of interest while recommending securities at investment seminars.

The Divisional Court applied the pragmatic and functional approach, determining the standard of review was reasonableness for the merits and public interest findings.

The court upheld the Commission's findings that the appellant was in the business of advising and that his failure to disclose conflicts was contrary to the public interest.

However, the court found the Commission's process for determining the $300,000 costs award was procedurally unfair and remitted the costs issue back to the Commission.