CITATION: 1186708 Ontario Inc. v. Gerstein, 2017 ONSC 1217
DIVISIONAL COURT FILE NO.: 575/16 DATE: 20170221
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
LEDERMAN, SWINTON and STEWART JJ.
BETWEEN:
1186708 ONTARIO INC., 746190 ONTARIO LIMITED and 746191 ONTARIO LIMITED
Plaintiffs/ Appellants
– and –
ELLIOTT J. GERSTEIN, IRIS L. GERSTEIN, SYDNEY GERSTEIN, ATTARA DEVELOPMENTS LIMITED, BELLCREST BUILDERS LIMITED BRENTHALL APARTMENTS LIMITED, CHELSANDY DEVELOPMENTS
LIMITED, GROVER REALTY MANAGEMENT (a partnership),
GROVER REALTY CABLE
(a partnership), LILLIANA BUILDING LIMITED, LURAY INVESTMENTS LIMITED, PAULDOR DEVELOPMENTS LIMITED, 375685 ONTARIO LIMITED, STAN VINE CONSTRUCTION LTD., KILBARRY HOLDING CORPORATION, 678678 ONTARIO LIMITED,
MATANAH INVESTMENTS CORP., DAWN TRADING LTD., 497505 ONTARIO INC., 781527 ONTARIO INC.,781526 ONTARIO INC., RICHARD MINTZ and ANDREA MINTZ, Estate Trustees for SAUL MINTZ, IRWIN MINTZ, HOWARD MINTZ, FAYE MINTZ, MINTZ & PARTNERS (a partnership), RHONDA STRASBERG, ESTATE OF BELLE MERNICK, MINKIDS HOLDINGS (a partnership), ETTIE WOSNICK, MORRIS WOSNICK, 2135637 ONTARIO INC., LERRIC INVESTMENTS CORP., MERNICK CONSTRUCTION LIMITED and STANMORE DEVELOPMENTS LIMITED
Defendants/Respondents
P. James Zibarras, for the Plaintiffs/Appellants
Douglas B.B. Stewart and Deepshikha Dutt for the Defendants/Respondents, Irwin Mintz, Faye Mintz (deceased), 2135637 Ontario Ltd., Minkids Holdings, 781526 Ontario Ltd., and Mintz & Partners
Linda Galessiere, for the Defendants/Respondents, Sydney Gerstein, Matanah Investments Corp., and Lerric Investments Corp.
Elaine Peritz for the Defendants/Respondents Morris Wosnick, Ettie Wosnick, Dawn Trading Ltd., Howard Mintz, 781527 Ontario Ltd., Rhonda Strasberg and 497505 Ontario Inc.
Howard L. Shankman for the Defendants/Respondents, Richard Mintz and Andrea Mintz, Estate Trustee for Saul Mintz
HEARD at Toronto: February 21, 2017
SWINTON J. (Orally)
[1] The plaintiffs/appellants appeal from an order of Penny J. dated February 24, 2016 in which he dismissed their motion for leave to commence a derivative action under s. 246 of the Business Corporations Act, R.S.O. 1990, c. B.16 (the “OBCA”) because the leave motion was statute-barred.
[2] The appellants argue that the motions judge erred in refusing to apply the doctrine of nunc pro tunc. We disagree. The motions judge correctly applied the principles set out by the Supreme Court of Canada in Canadian Imperial Bank of Commerce v. Green, 2015 SCC 60 (“the CIBC trilogy”). While the appellants had commenced their action against the respondents in October 2007, within the limitation period in s. 4 of the Limitations Act, 2002, they did not bring the motion for leave to commence the derivative action until January 2016. The motions judge correctly held that a nunc pro tunc order could not be granted because the motion for leave had not been brought before the limitation period expired.
[3] The appellants argue that the Supreme Court of Canada’s decision in the CIBC trilogy addressed only leave applications under the Ontario Securities Act and not leave applications under other statutes, including the OBCA. We see no merit to this argument. We agree with para. 56 of the motions judge’s decision where he said:
I can find no basis upon which to distinguish the analysis and result in the majority decision of the CIBC case, nor was any argued before me. Everything that was said about the relationship of a statutory leave requirement to a statutory limitation period in CIBC (ss. 138.8 and 138.14 of the OSA) could equally be said about this case (Limitations Act, s. 4 and OBCA, s. 246).
[4] The decision of the motions judge was consistent with the ruling of the majority of the Supreme Court with respect to the Celestica action decided in the CIBC trilogy. The Celestica facts are similar to those here, as the pleadings in Celestica stated that leave would be sought. However, leave was sought after the expiry of the limitation period. The Supreme Court of Canada held that the nunc pro tunc doctrine is not available where a motion seeking leave is filed after the expiry of the applicable limitation period. As Coté J. said at para. 111, speaking for four judges:
As for Celestica, because no motion for leave was filed before the expiry of the limitation period, a nunc pro tunc order, assuming one were available, could not remedy that expiry. This is sufficient to deny a nunc pro tunc order.
[5] In any event, the motions judge indicated that he would not have exercised his discretion to grant such an order in the present case. The appellants have not shown that he made any error in principle. He applied the relevant factors (see paras. 61-62 of his reasons). This aspect of his decision is deserving of deference.
[6] Accordingly, the appeal is dismissed.
costs – Lederman J.
[7] I have endorsed the Appeal Book and Compendium of the Appellants as follows: “This appeal is dismissed for reasons delivered by Swinton J. Costs are fixed at the agreed amount of $16,000 all inclusive payable to the respondents within 30 days.”
___________________________ Swinton J.
I agree
Lederman J.
I agree
Stewart J.
Date of Reasons for Judgment: February 21, 2017
Date of Release: February 23, 2017
CITATION: 1186708 Ontario Inc. v. Gerstein, 2017 ONSC 1217
DIVISIONAL COURT FILE NO.: 575/16 DATE: 20170221
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
LEDERMAN, SWINTON and STEWART
BETWEEN:
1186708 ONTARIO INC., 746190 ONTARIO LIMITED and 746191 ONTARIO LIMITED
Plaintiffs/ Appellants
– and –
ELLIOTT J. GERSTEIN, IRIS L. GERSTEIN, SYDNEY GERSTEIN, ATTARA DEVELOPMENTS LIMITED, BELLCREST BUILDERS LIMITED BRENTHALL APARTMENTS LIMITED, CHELSANDY DEVELOPMENTS LIMITED, GROVER REALTY MANAGEMENT (a partnership), GROVER REALTY CABLE (a partnership), LILLIANA BUILDING LIMITED, LURAY INVESTMENTS LIMITED, PAULDOR DEVELOPMENTS LIMITED, 375685 ONTARIO LIMITED, STAN VINE CONSTRUCTION LTD., KILBARRY HOLDING CORPORATION, 678678 ONTARIO LIMITED, MATANAH INVESTMENTS CORP., DAWN TRADING LTD., 497505 ONTARIO INC., 781527 ONTARIO INC., 781526 ONTARIO INC., RICHARD MINTZ and ANDREA MINTZ, Estate Trustees for SAUL MINTZ, IRWIN MINTZ, HOWARD MINTZ, FAYE MINTZ, MINTZ & PARTNERS (a partnership), RHONDA STRASBERG, ESTATE OF BELLE MERNICK, MINKIDS HOLDINGS (a partnership), ETTIE WOSNICK, MORRIS WOSNICK, 2135637 ONTARIO INC., LERRIC INVESTMENTS CORP., MERNICK CONSTRUCTION LIMITED and STANMORE DEVELOPMENTS LIMITED
Defendants/Respondents
ORAL REASONS FOR JUDGMENT
SWINTON J.
Date of Reasons for Judgment: February 21, 2017
Date of Release: February 23, 2017