Corporate/Commercial Law - OCA

The applicants sought a stay of the Court of Appeal's order, which had reversed a supervising judge's decision to remove two directors from the board of a company undergoing CCAA restructuring, pending their application for leave to appeal to the Supreme Court of Canada.

The Court of Appeal first determined it had jurisdiction under s. 65.1(1) of the Supreme Court Act to consider the stay application.

Applying the RJR-MacDonald test, the court found that while there was a serious issue to be tried, the balance of convenience and the interests of justice favoured denying the stay, as granting it would effectively implement the supervising judge's order that the court had already found was made without jurisdiction.

The appellants appealed a trial judgment finding them liable for breach of contract.

The Court of Appeal dismissed the appeal, holding that the trial judge properly relied on business records admitted without objection to find a contract, breach, and damages.

The Court also upheld the judgment against both corporate defendants, noting their pleadings made no distinction between them, and found no error in the trial judge's refusal to grant an adjournment.

The appellants appealed a judgment regarding the repossession of a vehicle by the respondent.

The appellants argued the repossession violated the Personal Property Security Act and the Consumer Protection Act, and that a clause in the retail instalment contract was void.

The Court of Appeal dismissed the appeal, finding the repossession was lawfully based on the respondent's good faith belief that the vehicle was in jeopardy, rather than a default in payment, rendering the statutory provisions inapplicable.

The plaintiffs initially sued for repayment of loans and on a guarantee.

At trial, the plaintiffs argued breach of contract for the purchase of shares.

The trial judge granted judgment to the plaintiffs based entirely on provisions of the Ontario Business Corporations Act (OBCA) relating to share transfers, despite the plaintiffs expressly disavowing any remedy under the OBCA.

The Court of Appeal allowed the appeal, finding it was a breach of natural justice to grant judgment on a basis not pleaded or argued.

A new trial was ordered because the Court of Appeal could not make the necessary findings of fact regarding the contract terms or damages.

The appellants appealed a trial judgment declaring that the appellant Foo was not the beneficial owner of shares in the respondent corporation.

The appellants argued the trial judge improperly relied on extrinsic parol evidence and ignored an entire agreement clause in the initial share exchange agreement.

The Court of Appeal dismissed the appeal, holding that the trial judge correctly considered extrinsic evidence given the problematic nature of the transactions, which included backdated documents, inconsistencies, and unfulfilled underlying purposes.

The court noted that even if the appellants' arguments regarding the initial agreement were accepted, a subsequent acknowledgement would have reversed the transfer anyway.

The appellant registered a construction lien and commenced an action while it was a dissolved corporation.

It was later revived.

The motion judge vacated the lien but allowed the contract claim to continue.

The Divisional Court dismissed the lien appeal and dismissed the contract action.

The Court of Appeal held that the appellant could not rely on the corporate revival provisions of the Business Corporations Act to revive its lien action because the strict time limits under the Construction Lien Act had expired during dissolution, vesting 'rights' in the defendant.

However, the Court allowed the breach of contract claim to proceed, as the limitation period had not yet expired, permitting the appellant to amend its pleadings to correct the corporate misnomer.

The appellants appealed an order of the Superior Court of Justice regarding their right to recovery under a bond.

The Court of Appeal held that naming the appellants on the bond did not give them an independent right to recovery under their lending agreements.

The court declined to interfere with the motion judge's interpretation of the inter-lender agreement and dismissed the appeals with costs.

The respondents leased buses to a company that obtained a comprehensive business insurance policy from the appellant insurer.

The policy covered the respondents as an additional named insured.

After one of the leased buses was damaged, the insurer paid the repair costs but deducted unpaid premiums owed by the lessee.

The respondents successfully applied for an order that the insurer could not rely on s. 134(2) of the Insurance Act to withhold the unpaid premiums from the loss payment.

The Court of Appeal dismissed the insurer's appeal, holding that s. 134(2) restricts recovery by deduction to amounts payable to the party responsible for payment of the premiums, not a third party.

The appellant appealed the dismissal of its application for a certificate of pending litigation and specific performance of a real estate agreement.

The agreement was signed by an individual using an unregistered business name 'in trust for a company to be formed'.

The appellant, a pre-existing company, claimed status through a later assignment.

The Court of Appeal dismissed the appeal, holding that the individual violated the Business Names Act and lacked capacity to maintain a proceeding or assign benefits to circumvent the legislation.

The appellants appealed a summary judgment enforcing a guarantee in favour of the respondent bank.

The Court of Appeal dismissed the appeal, agreeing with the motion judge that the defence of misrepresentation was defeated by the strict terms of the guarantee.

The Court also rejected the appellants' other defences, including an alleged promise not to sue, failure to fully advance a loan, misapplication of funds, and improper approval of the sale of business assets.

The appellant company appealed an order declaring it in breach of a redemption obligation and entitling the respondent to immediate redemption of his preference shares for $1,600,000.

The appellant had refused to pay quarterly dividends to the respondent despite having the funds, suspecting the respondent of breaching non-compete obligations.

The Court of Appeal upheld the lower court's finding that the failure to pay dividends constituted a default under the Shareholders' Agreement, triggering the respondent's unconditional right to redeem his shares.

The court rejected the appellant's argument that the default provision only applied when the company lacked funds.

The tenant appealed a judgment interpreting a commercial lease.

A purchaser agreed to buy all of the tenant's shares, constituting a change in control and a 'transfer' requiring the landlord's consent.

The landlord consented while reserving its rights, and argued that under clause 11.03(b) it was entitled to an amended lease with increased rent.

The tenant argued the landlord's only option was to terminate the lease.

The Court of Appeal upheld the applications judge's finding that the change in control triggered clause 11, obliging the tenant to sign a new lease with increased rental payments, as the tenant's interpretation would render much of the clause ineffective.

The appellant purchased the respondent's insurance brokerage business from a trustee in bankruptcy.

The agreement of purchase and sale did not contain a non-solicitation clause.

The appellant appealed a motion judge's declaration that the respondent was entitled to solicit his former clients.

The Court of Appeal dismissed the appeal, holding that in an involuntary alienation of assets in a bankruptcy, there is no common law implied obligation on the part of the bankrupt not to compete and solicit former clients.

The appellant appealed a decision regarding the interpretation of an agreement of purchase and sale.

The appellant had inserted an earlier date as the acceptance date, which would have shortened the 60-day due diligence period.

The Court of Appeal upheld the motion judge's finding that the contract was created on the date the written acceptance was delivered to the purchaser.

Consequently, the purchaser's withdrawal was within the due diligence period, and it was entitled to the return of its deposit.

The appeal was dismissed.

The plaintiff, an experienced investor, invested in special warrants and special shares of two private companies on the advice of his broker.

The broker failed to warn him of the risks associated with these investments, including the risk that the planned initial public offerings might never take place.

The plaintiff lost his entire investment and sued the broker and her firm for negligence.

The trial judge found the defendants liable but reduced the damages by 50% due to the plaintiff's contributory negligence in signing subscription agreements without reading them.

The defendants appealed.

The Court of Appeal dismissed the appeal, upholding the trial judge's findings that the broker breached her duty to warn and that her misrepresentation precluded the defendants from relying on the subscription agreements to raise an estoppel.

The respondent sold an automobile to Crown Leasing Ltd., who took possession and presented a cheque that was subsequently dishonoured.

The application judge held that title did not pass.

On appeal, the Court of Appeal found the application judge erred in law, holding that the usual inference that title passes with possession should have been drawn.

However, because the application judge did not decide whether the appellants were innocent third-party purchasers for value, and the evidence was conflicting, the Court set aside the judgment and directed a trial of that issue.

The appellant landlord appealed a decision interpreting a commercial lease.

The motion judge held the tenant was entitled to a rent reduction for increases in real estate taxes and ordered a reference to determine the apportionment of snow removal costs.

The Court of Appeal allowed the appeal in part, finding the lease only protected the tenant from tax increases resulting from a specific 1998 assessment appeal, not from general rate increases.

However, the Court upheld the order for a reference regarding snow removal costs, finding the lease's audit clause did not preclude it.

The appellant bank appealed a trial judgment holding it liable for the unauthorized transfer of $4 million of the respondent's funds.

The appellant argued the trial judge erred by relying on hearsay evidence to reject its defences of acquiescence, ratification, and contributory negligence, by failing to draw an adverse inference, and by not reducing damages.

The Court of Appeal dismissed the appeal, finding the out-of-court statements were properly admitted to show the respondent's state of mind, not for their truth.

The court also upheld the trial judge's findings on the adverse inference and damages.

The appellant created a calendar and sold advertising space to pharmaceutical companies.

The respondent, a trade association, directed its members not to advertise in the calendar, claiming it violated their Code of Marketing Practices.

This direction destroyed the appellant's business.

The appellant sued for intentional interference with economic relations.

The trial judge found the respondent's initial letter was tortious but cured by a subsequent legitimate ruling.

The Court of Appeal allowed the appeal, finding the respondent had no authority under its Code to prohibit members from advertising in third-party products.

The Court held the unauthorized ruling constituted unlawful means, satisfying the elements of the tort of intentional interference with economic relations, and directed a reference on damages.

The appellants appealed a trial judgment finding that no enforceable agreement was reached for a fur salon licence, as essential terms were missing.

The respondent cross-appealed the finding that it negligently misrepresented its ability to terminate an existing licence, and appealed the costs award, specifically the allowance of expert witness fees as a full disbursement on a partial indemnity scale.

The Court of Appeal dismissed the appeal, cross-appeal, and costs appeal, holding that the trial judge made no palpable errors and correctly treated expert fees as disbursements not subject to partial indemnity reduction.