Marc Kestenberg

The applicant corporation sought a final order approving a plan of arrangement under s. 182 of the Ontario Business Corporations Act in connection with the acquisition of all outstanding shares by a subsidiary of the purchaser corporation for cash consideration.

The court applied the framework from BCE Inc. v. 1976 Debentureholders, requiring satisfaction that the transaction constituted a statutory arrangement, that procedural requirements were met, that the application was brought in good faith, and that the arrangement was fair and reasonable.

Evidence demonstrated a robust sale process, board oversight through a special committee, independent financial advice, and a significant premium to market value.

Shareholders overwhelmingly approved the arrangement, no dissent rights were exercised, and no opposition appeared.

The court concluded that the arrangement served a valid business purpose and fairly balanced the interests of affected stakeholders.

The moving party defendants sought leave to appeal a motions judge's refusal to strike out the plaintiff's claims for 'knowing assistance of breach of fiduciary duty' and 'assisting or facilitating breach of contract' in a proposed class action arising from investments in a hedge fund.

The Divisional Court granted leave to appeal, finding that there were conflicting decisions regarding the existence of the tort of assisting breach of contract, and good reason to doubt the correctness of the decision regarding knowing assistance of breach of fiduciary duty given the plaintiff was not a client of the defendants.

The issues were deemed to be of general importance to the investment industry.