The appellants, Xundong Qin and Cenith Air Inc., sued the Ontario Securities Commission (OSC) and three of its employees for malicious prosecution after the OSC's allegations against them were dismissed.
The respondents moved to strike the claim, arguing issue estoppel applied due to a prior Superior Court order by Pattillo J. that continued a freeze order, finding a "serious issue to be tried." The motion judge granted the strike.
The Court of Appeal allowed the appeal, holding that the "serious issue to be tried" standard for continuing a freeze order is a lower threshold than "reasonable and probable cause" required for malicious prosecution.
Therefore, the issue of reasonable and probable cause was not "necessarily bound up" in Pattillo J.'s decision, and issue estoppel did not apply.
The matter was remitted to the Superior Court.