Lisa C. Munro

The plaintiffs, minority shareholders, brought a motion for a mandatory interlocutory injunction seeking reinstatement to the board of directors and an order compelling the corporation to declare dividends.

The plaintiffs had previously sued the corporation and majority shareholders for $7.5 million for conspiracy, fraud, and oppression.

The court dismissed the request for mandatory injunctions, finding the plaintiffs did not establish a strong prima facie case for reinstatement due to their conflict of interest, nor for an immediate dividend distribution while the corporation's liability in the lawsuit remained undetermined.

However, the court granted a non-mandatory injunction preserving the status quo by prohibiting the corporation from expending funds outside the ordinary course of business.

The appellants appealed a summary judgment enforcing a Consulting Agreement and a Letter of Credit Agreement, and the dismissal of their motion to consolidate two related actions.

The appellants argued the agreements were unenforceable as illegal loans under the Criminal Code and were procured in breach of fiduciary duty.

The Court of Appeal dismissed the appeal, upholding the motion judge's findings that the case was document-driven, appropriate for summary judgment, the agreements were not loans, and no fiduciary duty existed.

In a certified class action arising from a residential apartment fire, a defendant property manager sought leave to discontinue its third party claim against an insurance adjusting firm and a security investigation company without costs following settlement of the main action.

The third parties opposed the motion and sought substantial indemnity costs exceeding $127,000.

The court held that although it was reasonable for the defendant to join the third parties given allegations concerning post‑fire activities, it was not reasonable to discontinue the claim without compensating them for defending the proceeding.

Applying the general costs principles under rule 57.01 and the discretionary framework for discontinuances under rule 23.05, the court awarded costs on a partial indemnity basis.

The court fixed fair and reasonable costs at $72,000 inclusive of disbursements and taxes.

The applicants brought a motion in an oppression proceeding under the Ontario Business Corporations Act seeking interim costs and related relief.

The court reviewed the legal test under OBCA s. 249(4), requiring a complainant to demonstrate a case of sufficient merit and financial circumstances that would preclude pursuit of the claim without funding.

The court found that the individual complainant established an arguable oppression claim involving alleged expulsion from corporate management, cessation of compensation, and disputes under a shareholders’ agreement.

However, the trust applicant failed to disclose relevant financial information.

The court concluded that the individual complainant met the financial hardship requirement but reduced the interim costs award to reflect the trust’s failure to disclose its financial circumstances.

Following reasons on a motion concerning the removal of counsel for corporate and individual respondents, the court determined the appropriate costs award.

Success on the underlying motion was divided: counsel was removed for the corporate respondents but permitted to continue acting for the individual respondents.

Applying the principles under Rule 57 of the Rules of Civil Procedure, including proportionality and the guidance from appellate authority on fixing fair and reasonable costs, the court concluded neither side achieved complete success.

The applicants’ prior settlement offer was not considered because it addressed issues beyond the motion.

Partial indemnity costs of $4,000 were fixed, payable in the cause of the application.

The applicants brought a motion to remove the respondents’ solicitor of record on the basis of alleged conflicts of interest and the possibility that the lawyer might be called as a witness.

The court applied the conflict of interest principles from MacDonald Estate v. Martin and Canadian National Railway Co. v. McKercher LLP.

It held that the lawyer had not previously acted for the individual applicant or his trust in a manner giving rise to confidential information relevant to the litigation, and that the earlier retainer for a corporate applicant in unrelated litigation was not sufficiently related to the present oppression dispute.

However, the court found that a conflict arose because the lawyer sought to represent both the respondent corporations and the individual shareholder respondents in oppression litigation where their interests could diverge.

The lawyer was therefore removed as counsel for the corporate respondents but permitted to continue acting for the individual respondents.

In six Ontario libel actions tied to statements posted by a U.S. company and later republished in Ontario newspapers, the appellants argued Ontario lacked jurisdiction or should defer to Illinois.

The Court held that defamation was presumptively connected to Ontario because publication occurred there through reading, downloading, and republication.

It concluded the appellants did not rebut jurisdiction and did not prove Illinois was clearly the more appropriate forum under forum non conveniens.

The appeal was dismissed with costs.

The respondent, Conrad Black, brought libel actions in Ontario against the directors and advisors of a U.S. company for statements posted on the company's website.

The appellants moved to stay the actions, arguing Ontario lacked jurisdiction or was forum non conveniens.

The motion judge dismissed the motion.

On appeal, the Court of Appeal applied the Van Breda test and upheld the motion judge's finding that the alleged tort was committed in Ontario, establishing a presumptive real and substantial connection.

The court found no unfairness in requiring the appellants to defend the actions in Ontario, as the statements were targeted at Canadian media and the respondent's reputation was damaged there.

The appeal was dismissed.

The appellant bank sued several financial institutions and insurers for approximately $100 million arising from a massive equipment leasing fraud involving forged endorsements.

The respondent financial institutions successfully moved for summary judgment dismissing the appellant's claims for negligence, unjust enrichment, and money had and received.

The Court of Appeal allowed the appeal and set aside the summary judgment, finding that the motion judge committed two fundamental errors: reversing the onus by requiring the responding party to establish a genuine issue for trial, and deciding the motions on the assumed fact that the endorsements were forged.

The Court ordered the entire action to proceed to trial, noting that novel claims should be decided on a full evidentiary record.

The moving parties, several banks and a financial institution, sought leave to appeal a motions judge's refusal to grant summary judgment dismissing the plaintiff's claims in conversion and preclusion.

The underlying action involved a fraudulent scheme where a customer forged endorsements on cheques and bank drafts, deposited them with the plaintiff collecting bank, and the moving parties subsequently reverse-cleared the instruments.

The Divisional Court granted leave to appeal, finding good reason to doubt the correctness of the motions judge's decision that the conversion and preclusion claims raised genuine issues for trial, and noting the issues were of general importance to the banking industry.

The court appointed an inspector to investigate the affairs of the appellant corporation and ordered the appellants to fund the inspector's work.

The appellants appealed the order and argued that the funding requirement was an 'order for the payment of money' automatically stayed under Rule 63.01(1) of the Rules of Civil Procedure.

The Divisional Court held that an order to fund a court-appointed inspector is not an order for the payment of money, as it does not give monetary relief to a party and cannot be enforced by a writ of seizure and sale.

The court declared the automatic stay inapplicable and, in the alternative, exercised its discretion to lift the stay.

The appellants' cross-motion for a stay was dismissed.