Martin J. Henderson

The defendants brought a Rule 21 motion to strike an amended statement of claim on the basis that it disclosed no reasonable cause of action and was an abuse of process due to a related proceeding.

The court applied the stringent Rule 21 test and held that most of the pleaded causes of action—including breach of an implied contractual duty of good faith, inducement of breach of duty, inducement of breach of fiduciary duty, and intentional interference with economic relations—were not plainly doomed to fail and therefore should proceed.

However, the conspiracy claim failed to properly plead the necessary elements and was struck with leave to amend.

The request to stay the proceeding due to a separate action involving a solicitor and law firm was rejected because the parties and subject matter were not the same.

Costs were awarded to the responding parties.

The appellants conceded that their appeal was moot.

The Supreme Court of Canada declined to exercise its discretion to hear the appeal notwithstanding its mootness and quashed the appeal.

However, because the Crown failed to move to quash with due diligence, the Court awarded costs of the appeal to the appellants on a party to party basis.