Michael A. Handler

The plaintiff corporation sued its former CEO and director, alleging he breached his fiduciary duties by resigning to usurp lucrative hospital management opportunities in London and Abu Dhabi for his own benefit through a new corporate entity.

Following a four-week trial, the court dismissed the action, finding that the opportunities in question were not mature, were not in the plaintiff's direct line of business, and were not available to the plaintiff due to a lack of trust from the contracting parties.

The court concluded that the opportunities arose from the defendant's personal relationships and professional reputation, and therefore did not fairly belong to the plaintiff.

The plaintiff brought a motion to set aside a Registrar's order dismissing its $104 million action for delay.

The action involved claims of breach of contract and fiduciary duty against a former director.

The court found that the litigation delay was adequately explained by the ongoing discoveries and undertakings, and that the failure to set the action down for trial was due to counsel's inadvertence.

Finding no actual prejudice to the defendants, the court exercised its discretion to set aside the dismissal order.

Following a prior endorsement concerning priority disputes under the Construction Lien Act, the court clarified issues arising during preparation of the formal order.

The court held that holdback deficiencies relating to certain claimants with untimely or invalid liens could not be included in calculating amounts payable to successful lien claimants, relying on authority confirming that amounts relating to invalid liens cannot expand statutory priority.

The court also rejected attempts to pool funds posted to bond off unsuccessful liens in order to increase the priority recovery of successful contractors beyond the statutory 10 percent holdback.

Costs issues from a reference before the Master were reconsidered, with the court setting aside the Master’s costs order and directing that each side bear its own costs of the reference while recognizing shared “carriage costs” among successful lien claimants.

Additional clarification was provided regarding allocation of motion costs and the structure of the distribution chart for priority payments.

The moving party, a mortgagee, opposed the confirmation of a Master's report regarding a reference under the Construction Lien Act.

The Master had found that the mortgagee, by posting security under s. 44 to vacate liens, lost its priority over the liens and was liable for the full amount of the lien claims rather than just the holdback deficiencies.

The Superior Court of Justice found that the Master committed several palpable and overriding errors of law by failing to follow binding precedent, including decisions of the Divisional Court.

The court held that a mortgagee can post security under s. 44 without losing its priority under s. 78(2), that the mortgagees did not become statutory owners at the relevant time, and that the holdback deficiencies must be calculated based on the individual contracts of the lien claimants.

The Master's report was ordered to be revised accordingly.

The plaintiff subcontractor brought an action against the defendant contractor for breach of contract and under the Construction Lien Act for unpaid amounts relating to the supply and installation of structural steel.

The defendant counterclaimed for damages, alleging the plaintiff caused construction delays and failed to complete its work, requiring the defendant to intervene.

The court found that the plaintiff completed its contractual obligations within a reasonable time and that the defendant breached the contract by refusing to pay the balance owing.

The defendant's counterclaim for set-off was largely dismissed for lack of reliable evidence, and the plaintiff was awarded the balance of the contract price.

In a reference under the Construction Lien Act, multiple contractors sought to enforce their claims for lien against the owner and mortgagees of a townhouse development.

The owner had defaulted, and a subsequent mortgagee posted security under s. 44(1) to vacate the liens and facilitate the sale of the remaining units.

The court determined the timeliness and quantum of the various lien claims.

The court held that because the mortgagee chose to post security under s. 44(1) rather than s. 78(10), the liens ceased to attach to the premises and instead became a charge on the posted security in full, rather than being limited to the holdback deficiency.

Alternatively, the court found the mortgagee had acted as an 'owner' under the Act by taking over the completion and sale of the project.