Michael A. Penny

This addendum to a prior summary judgment resolves a dispute over the precise amount outstanding under a settlement agreement, which was a condition for granting relief from forfeiture to the defendants.

The court determined the defendants were liable for $12,000 in default administration fees for a specific period (July, August, September 2018) and $108,624.53 in legal fees incurred before November 2018, totaling $120,624.53.

The court rejected the plaintiff's claim for interest on default administration fees and for default administration fees accruing after October 2018 due to the plaintiff's own intransigence in providing an accounting.

A deadline of 30 days was set for payment, failing which the relief from forfeiture would be null and void.

The plaintiffs, a group of mortgage lenders, brought a motion for summary judgment seeking full arrears at a 25% annual interest rate and default administration fees after the defendants breached a settlement agreement.

The settlement had reduced the interest rate, but the defendants' opposition to a property sale approval motion triggered a clause voiding the release.

The defendants sought relief from forfeiture or argued the rates violated the federal Interest Act.

The court granted relief from forfeiture, finding the breach caused minimal prejudice to the lenders compared to the substantial forfeiture sought, and ordered an accounting of any remaining settlement amounts.

The court also found the 25% interest rate and default fees were not unenforceable under the Interest Act due to prior Supreme Court and Court of Appeal rulings on time-triggered rate increases and consensual resolutions.

The defendants moved for summary judgment on a limitation issue, arguing the plaintiffs' action was statute-barred due to discoverability.

The plaintiffs alleged breach of contract, fiduciary duty, misappropriation, and unjust enrichment related to a cannabis business venture.

The court found that the discoverability issues were contentious and complex, with significant factual disputes overlapping with the merits of the claim.

The record did not allow for the necessary findings of fact with the certainty required for summary judgment.

The motion was dismissed, and costs were fixed in the cause.

This case involved two motions within a bankruptcy proceeding.

The bankrupt, Dennis Wing, sought to lift a freeze direction imposed by the Ontario Securities Commission (OSC) on his registered retirement saving plan (RRSP) and locked-in retirement accounts (LIR), arguing they were exempt assets under the Bankruptcy and Insolvency Act (BIA).

The OSC, in turn, sought a declaration that a monetary penalty and costs ordered against Wing for violating a cease trade order (CTO) were not claims provable in bankruptcy, allowing them to enforce the claims post-discharge.

The court dismissed Wing's motion, finding the freeze direction served a purpose given potential opposition to his discharge.

The court granted the OSC's motion, applying the three-part test from AbitibiBowater and Orphan Well Association, concluding that the OSC was not a creditor, the obligation was not incurred before bankruptcy, and the claim's monetary value was too speculative at the date of bankruptcy.

The court also found that a subsequent settlement agreement superseded an earlier undertaking by the OSC regarding enforcement.

This application concerned the validity of powers of attorney (POAs) for property and personal care signed by Agnes Adler, a 90-year-old woman, in September 2017.

The applicant, Judy Adler, sought to uphold these POAs, which appointed her and her sister, Andrea Gregor, jointly.

Andrea Gregor, a respondent, challenged their validity, arguing Agnes lacked capacity and was subject to undue influence.

The court also considered the validity of 2015 POAs appointing Andrea solely, the status of Agnes's joint bank accounts with Andrea, and a $25,000 gift from Agnes to Andrea.

The court found the 2017 POAs invalid due to Agnes's lack of capacity to appreciate the consequences of appointing joint attorneys given the sisters' acrimonious relationship, and alternatively, due to undue influence by Judy.

The 2015 POAs, appointing Andrea solely, were upheld.

Andrea was ordered to transfer Agnes's joint bank accounts to Agnes's sole ownership and to repay the $25,000 gift.

The court criticized both daughters for misusing capacity assessments in their litigation.

The plaintiffs sued CIBC and Belzberg for breach of contract or negligence after a direct market access (DMA) system malfunctioned, causing significant error trades and the eventual shutdown of their hedge fund.

The court found CIBC prima facie liable, determining that Belzberg employees acted as CIBC's apparent agents when they negligently caused the malfunction.

The court rejected CIBC's broad contractual exclusion of liability for direct damages but upheld the exclusion for lost profits.

The plaintiffs were awarded direct trading losses, with no reduction for mitigation or contributory negligence, and punitive damages were denied.

The plaintiff, 1085372 Ontario Limited, brought an action under the Bankruptcy and Insolvency Act (BIA) and the Fraudulent Conveyances Act (FCA) to set aside a transfer of shares in Linus Entertainment Inc. from Michael Shumak to Geoff Kulawick.

The plaintiff alleged the transfer was at undervalue or a fraudulent conveyance.

The court found that the parties dealt at arm's length, the transaction occurred outside the one-year clawback period under the BIA, and the transfer was not at undervalue.

Furthermore, the court found no fraudulent intent on the part of Shumak and that Kulawick acted in good faith and paid good consideration.

The action was dismissed.

This application sought a determination of contractual rights regarding an early termination provision in pre-construction condominium agreements.

The applicants argued that a 'sole, absolute and unfettered discretion' proviso in a financing condition rendered the entire condition null and void under the Tarion Addendum, leading to a breach of contract claim.

The court found that the proviso did not form part of the early termination condition or, if it did, it was inconsistent with the Addendum's requirement for commercially reasonable steps and was therefore unenforceable.

The court interpreted the condition to require vendors to take all commercially reasonable steps to arrange satisfactory financing, upholding the validity of the termination condition and dismissing the application.

This is an appeal from a Registrar in Bankruptcy's decision to transfer a bankruptcy application from Toronto to Hamilton, based on the debtor's residence.

The Superior Court of Justice found that the Registrar erred in law by concluding the Toronto court lacked jurisdiction.

The court clarified that Hamilton falls under Bankruptcy Division 32, which is administered by the Toronto bankruptcy court, making Toronto the proper jurisdiction for such applications under s. 43(5) of the BIA.

The appeal was allowed, setting aside the Registrar's decision.

The Receiver of two insolvent real estate brokerages (TRP and TRP Realty) sought the court's advice and direction on whether approximately $3.7 million in commissions owed to the brokerages' agents were held in trust for the agents or formed part of the general assets available to secured creditors.

The court applied the "three certainties" test for a valid trust, focusing on certainty of intention.

Despite some ambiguous indicators like bank account names and standard form documents, the court found that the agents' contracts and the brokerages' audited financial statements did not objectively demonstrate an intention to create a trust.

Consequently, the commissions were deemed unsecured debts, not trust funds, and thus available to the secured creditors.

The applicants, minority shareholders of Deciem Beauty Group Inc., brought an urgent oppression application under the Canada Business Corporations Act seeking various interim orders against Deciem, Integridad Inc., Pasquale Cusano, and Brandon Truaxe.

The motion sought to remove Mr. Truaxe from Deciem's board, officer, and employee roles, appoint an interim CEO, define the board composition, prohibit Truaxe's interference with business operations and electronic systems, amend the unanimous shareholders agreement, and appoint PriceWaterhouseCoopers LLP to investigate allegations of criminal activity and Deciem's financial condition.

The court found a triable issue of oppression, irreparable harm to Deciem, and that the balance of convenience favored granting the injunction, given Truaxe's erratic and destructive behavior that brought the company to the brink of disaster.

The plaintiffs moved to enforce an alleged settlement agreement with the defendant Seven Hills Group LLC, while Seven Hills brought a cross-motion for summary judgment to dismiss the negligence claim against it.

The court found no binding settlement agreement existed, as the parties had not agreed on essential terms regarding the scope and indemnity provisions of the release.

The court granted Seven Hills' motion for summary judgment, concluding that Seven Hills owed no duty of care to the plaintiffs, as its engagement letter with Xtreme Labs expressly limited its duties and prohibited reliance by third parties like the plaintiffs for the purpose of a management buyout.

The action against Seven Hills was dismissed, and costs were awarded to Seven Hills.

The applicant (Saad Elias in the main application) sought an order declaring his mother incapable of managing property and appointing his brother as guardian.

The respondent (Daad Abdulwahid in the main application) brought a motion for security for costs against Saad Elias, who resided in California and had no assets in Ontario.

The court found that Saad Elias failed to demonstrate impecuniosity and that his underlying application for guardianship was devoid of merit, particularly regarding the existence of a valid power of attorney and the lack of evidence for misuse of funds.

The motion for security for costs was granted.

The Estate Trustee During Litigation (ETDL) for the estate of Elias Gefen brought a motion seeking payment of his significant fees and disbursements from disputed estate assets, a priority charge on these assets, and permission for interim payments.

The motion was supported by Harry Gefen and the estate of Yehuda Gefen, and opposed by Henia Gefen, Harvey Gefen, and a non-party co-tenant.

The court found that the ETDL was entitled to payment from the 'Property Interest' (disputed assets) and a charge on it, interpreting the original appointment order broadly to include assets with contingent estate interests.

The court denied the ETDL's request to further mortgage the properties to raise funds, citing potential adverse effects on non-parties.

The ETDL was granted the right to make interim payments from available distributions, subject to a final passing of accounts.

Costs were awarded against the opposing parties personally and the balance from the Estate.

The Kraus group of companies, a vertically integrated carpet manufacturer and flooring distributor, applied for an initial order under the Companies’ Creditors Arrangement Act (CCAA) due to significant financial difficulties and insolvency.

The application sought a stay of proceedings, appointment of Deloitte Restructuring Inc. as Monitor, and the granting of an Administration Charge and a Directors’ Charge.

The court granted the initial order, finding that the applicants met the CCAA threshold, a stay was appropriate for the business and its directors/officers, the proposed Monitor was qualified, and both the Administration Charge and Directors’ Charge were justified to secure essential services and ensure continued director involvement.

A sealing order for sensitive commercial information was also granted.

The respondents brought a motion for a stay of execution of a prior judgment by Justice Akhtar, which ordered the removal of illegal construction at their properties due to flagrant violations of building codes and zoning bylaws.

The court dismissed the respondents' motion, finding their conduct to be a continuation of prior violations and their arguments specious.

The court applied a higher test for staying a final judgment, requiring proof that enforcement would be oppressive, vexatious, or an abuse of process, and would not cause injustice to the plaintiff.

The court found that the City's enforcement was not oppressive and that the public interest in safety outweighed the respondents' claims.

Costs were awarded to the City.

The defendant, Marker Volkl (International) GmbH, brought a motion under Rule 21.01 to strike the plaintiff's (Tucows.com Co.) claim for declaratory relief.

The plaintiff sought declarations regarding its ownership of a domain name after an adverse decision under the Uniform Domain Name Dispute Resolution Policy (UDRP), which ordered the transfer of the domain name to the defendant.

The defendant argued that the declarations sought were not justiciable and lacked utility as they related exclusively to the UDRP test, which Canadian courts have no jurisdiction to apply or enforce.

The court dismissed the motion to strike, finding that the jurisprudence on the interplay between UDRP decisions and domestic court jurisdiction for declaratory relief was unsettled and should not be resolved on a Rule 21.01 motion.

The plaintiff, Bob Kinnear, on behalf of Local 113 of the Amalgamated Transit Union, sought an interlocutory injunction to prevent the defendant, Lawrence J. Hanley, representing the Amalgamated Transit Union (International), from imposing a trusteeship over Local 113 and from disciplining its members.

The motion also sought to authorize Kinnear to represent Local 113 members and to have Local 113 provide the undertaking as to damages.

The court granted the interlocutory injunction to restrain the trusteeship and ordered Local 113 to provide the undertaking, finding a serious issue to be tried regarding the unconscionability of International's constitution, irreparable harm to democratic rights, and that the balance of convenience favored the plaintiff.

The request for a representative order was deferred.

This application concerned a commercial condominium owner's right to exercise an easement granted by a neighbouring condominium corporation for the installation of utilities.

The respondent condominium corporation argued that the applicant, by virtue of owning parking units within its complex, was an 'owner' subject to Section 98 of the Condominium Act, requiring board approval and a formal agreement for alterations to common elements.

The court determined that the applicant was not an 'owner' of the respondent for the purposes of exercising the easement rights related to its commercial unit in the adjacent condominium, and therefore Section 98 did not apply.

The court also found the applicant was a beneficiary of the easement and that a shared facilities agreement did not apply to the proposed work.

The plaintiffs, a franchisee and its principal, brought an action for rescission of a franchise agreement under the Arthur Wishart (Franchise Disclosure) Act, 2002, alleging material deficiencies in the franchisor's disclosure document.

The court found three critical deficiencies: the absence of the most recent financial statements, the failure of the franchisor's associate to sign the certificate of truth and accuracy, and the omission of the head lease.

Each deficiency, and certainly all three combined, constituted defective disclosure so material as to amount to "no disclosure at all," thereby triggering the two-year rescission period under s. 6(2) of the Act.

The court rejected the franchisor's arguments that the deficiencies were cured, that disclosure to an agent was sufficient, or that an acknowledgement in the franchise agreement barred the action, citing the Act's consumer protection purpose and "no waiver" provision.

The defendants' counterclaim was dismissed.

The court awarded the plaintiffs rescission damages totaling $287,289.63, including franchise fees, royalties, rent deposit, leasehold improvements, and equipment.