The appellants appealed a trial judgment awarding the respondent $292,000 in damages for oppression under the Business Corporations Act.
The trial judge found the appellant engaged in oppressive conduct by failing to keep proper financial records, using company funds for personal expenses, and misappropriating funds through an undisclosed arrangement with another company.
The Divisional Court upheld the findings of oppression and the damages awarded for loss of profits and personal expenses.
However, the court allowed the appeal in part, setting aside the $182,000 award for loss of business value, finding it was an error in principle because the parties had agreed to wind up the business and distribute net assets, making book value or fair market value irrelevant.