Corporate/Commercial Law - ODC

The appellants appealed a trial judgment that conducted an accounting between the parties following a failed joint venture in an excavating business.

The trial judge found the appellants owed the respondents a net amount of $3,271.60.

On appeal, the appellants argued the trial judge exhibited bias, ignored evidence, and decided the case on an unpleaded issue.

The Divisional Court dismissed the appeal, finding no bias, no reviewable error in the accounting, and that the pleadings broadly contemplated an accounting.

The respondents' cross-appeal for costs was also dismissed.

The defendants, Nortel Networks Corporation and John Roth, appealed an interlocutory order that struck only portions of the plaintiff's statement of claim.

The Divisional Court allowed the appeal and struck the entire statement of claim against the appellants, finding it disclosed no reasonable cause of action.

The court held that the plaintiff failed to plead the essential elements of negligent misrepresentation, failed to plead material facts to overcome the business judgment rule regarding alleged mismanagement, and lacked standing as an individual shareholder to bring claims for conversion of company property.

The appellant appealed a trial decision finding it suffered no damages after its loader was damaged by the defendant.

The trial judge had characterized the appellant's payments for the damaged machine as lease costs rather than contributions toward a purchase under a conditional sales contract.

The Divisional Court allowed the appeal, finding the appellant was forced to incur the expense of renting an alternative loader while waiting for the insurance company to write off the original machine, and awarded damages for the rental costs.

The plaintiffs appealed a Master's decision refusing their motion to amend their Statement of Claim in a wrongful dismissal and share repurchase dispute.

The Master had denied the amendment on several grounds, including prejudice, election, and withdrawal of an admission.

The Divisional Court allowed the appeal, finding the Master was clearly wrong because he applied the wrong test for prejudice under Rule 26.01 and improperly weighed evidence and made factual findings, which is inappropriate on a motion to amend pleadings.

The court directed the plaintiffs to prepare an amended Statement of Claim, excluding certain paragraphs that offended the rule in Foss v. Harbottle.

The appellant appealed the dismissal of her application for an oppression remedy under s. 248 of the Business Corporations Act.

The dispute centered on a numbered company incorporated by the appellant's late husband to hold a Florida condominium, with shares held by the appellant and the husband's children.

The motion judge found that the husband had loaned money to the corporation and had not forgiven the loan prior to or upon his death.

The Divisional Court upheld the motion judge's findings that the loan remained an obligation of the corporation and that the failure of the estate to forgive the loan did not constitute oppressive conduct by the corporation or its directors.

The appeal was dismissed.

The appellant appealed the dismissal of a motion to certify a class proceeding against the respondent bank.

The proposed class action alleged that the respondent received interest on cash advances at a criminal rate, in violation of s. 347(1)(b) of the Criminal Code, and sought restitutionary, declaratory, and injunctive relief.

The Divisional Court dismissed the appeal, upholding the motions judge's findings that the restitutionary claims did not raise common issues and that a class proceeding was not the preferable procedure for resolving the claims for declaratory and injunctive relief.

The appellants sought to perfect an appeal of a trial judge's order directing a corporate audit under the Ontario Business Corporations Act, despite a previous order by the Divisional Court denying an extension of time to appeal on the basis that the appeal lacked merit.

The appellants argued they perfected the appeal to pre-empt the Registrar from dismissing it for delay after the trial judge's order was finally entered.

The court quashed the purported perfection of the appeal, finding no change in circumstances to reconsider the prior finding that the appeal was devoid of merit, but granted the appellants an extension of time to appeal the previous order denying the extension.

The appellant, a corporate director, appealed a decision finding him personally liable under s. 248 of the OBCA for a corporate debt owed to the respondent for fresh produce.

The Divisional Court allowed the appeal, finding that while the appellant was a director, there was no evidence he exercised his powers in an oppressive or unfairly prejudicial manner.

A related appeal from a decision refusing to set aside the original order on the basis of mistake was dismissed.

The appellant company appealed a decision of the Ontario Securities Commission which found that the company had waived solicitor-client privilege over certain legal opinions by providing them to its auditor.

The Divisional Court allowed the appeal, holding that statutory disclosure of privileged documents to an auditor constitutes a limited waiver for audit purposes only, not an absolute waiver.

Furthermore, the auditor's subsequent unauthorized disclosure of the documents to Commission staff did not waive the privilege, as the auditor lacked the authority to do so.

The applicant developer sought judicial review of an Ontario Energy Board (OEB) decision dismissing its complaint against Toronto Hydro.

The applicant argued that its subdivision project was governed by a new competitive regime for electrical distribution systems, while Toronto Hydro insisted the old monopolistic rules applied.

The OEB found that an implied agreement existed prior to November 1, 2000, exempting the project from the new rules.

The Divisional Court held that the OEB did not breach procedural fairness by declining to hold a hearing.

However, applying a reasonableness standard of review, the Court found the OEB's conclusion of an implied agreement prior to November 1, 2000, was unreasonable and an error of law, given that the parties had executed a written connection agreement expressly dated November 8, 2000.

The OEB's decision was quashed and remitted for further consideration.

The applicant sought judicial review of an Ontario Energy Board decision finding that a subdivision project was subject to an agreement with Toronto Hydro prior to November 1, 2000, thereby exempting it from new competition rules.

In dissenting reasons, the judge applied the pragmatic and functional approach, determined the standard of review was reasonableness, and concluded the OEB's interpretation of 'subject to an agreement' was reasonable given the transitional context and prior design agreements.

The dissenting judge would have dismissed the application.

The Minister of Finance appealed a decision vacating a land transfer tax assessment against Upper Valley Dodge Chrysler Limited.

The sole shareholder of the corporation had transferred land to the corporation and claimed an exemption under s. 3(1) of Regulation 697, which applies to transfers from an 'individual' to a 'family business corporation'.

The Minister argued the corporation could not be an 'individual' or 'operator' under the strict wording of the regulation.

The Divisional Court dismissed the appeal, applying a purposive approach to statutory interpretation to find that the transfer fell within the intended scope of the family business exemption.

The appellants appealed a trial judgment finding fraud and awarding damages.

The Divisional Court upheld the trial judge's finding of fraud, noting the appellant falsely represented that a $123,000 deposit had been paid.

The court also found no palpable and overriding error in the valuation of the equipment.

However, the court allowed the appeal in part to correct an error in the interest calculation, reducing the judgment amount to $18,533.43.

The appeal and cross-appeal were otherwise dismissed.

The appellant appealed a Small Claims Court judgment awarding the respondent $5,500 for the sale of welding wire.

The appellant argued the trial judge erred in finding the wire was still certified and failed to appreciate the extent of the defects.

The Divisional Court dismissed the appeal, finding the trial judge's conclusions were supported by the evidence and there was no palpable and overriding error.

The appellants appealed a judgment granting the respondent's application for the sale of five commercial properties under the Partition Act.

The parties were co-tenants, and the respondent, holding a minority interest, refused to consent to the appellants' management and leveraging plans after the appellants acquired their majority interest.

The Divisional Court dismissed the appeal, affirming that a co-tenant has a prima facie right to compel a sale under the Davis test, and that the respondent's conduct was not malicious, oppressive, or vexatious, but rather a predictable response to a business relationship breakdown.

The court appointed an inspector to investigate the affairs of the appellant corporation and ordered the appellants to fund the inspector's work.

The appellants appealed the order and argued that the funding requirement was an 'order for the payment of money' automatically stayed under Rule 63.01(1) of the Rules of Civil Procedure.

The Divisional Court held that an order to fund a court-appointed inspector is not an order for the payment of money, as it does not give monetary relief to a party and cannot be enforced by a writ of seizure and sale.

The court declared the automatic stay inapplicable and, in the alternative, exercised its discretion to lift the stay.

The appellants' cross-motion for a stay was dismissed.

The appellants appealed an order dismissing their motion for certification of a class proceeding and striking certain paragraphs of their statement of claim.

The proposed class action alleged negligence and negligent/reckless misrepresentation by the respondent auditors in connection with financial statements relied upon by lenders who advanced over US$1 billion.

The Divisional Court allowed the appeal in part, finding that the motions judge erred in striking the claim for reckless misrepresentation and in concluding that a class proceeding was not the preferable procedure.

The court upheld the striking of claims by assignor lenders and claims against individual partners and employees.

The matter was referred back to a class proceedings judge.

The appellants, minority shareholders in Colio Wines of Canada Ltd., appealed the dismissal of their application for an oppression remedy and the appointment of an inspector under the Ontario Business Corporations Act.

The appellants alleged that a 1992 amalgamation unfairly valued their shares at one cent each.

The Divisional Court upheld the application judge's finding that the appellants failed to provide cogent evidence that oppressive conduct appeared to have occurred, as required by s. 161(2) of the Act.

The court confirmed that mere suspicion or a report suggesting oppression 'may have been' present is insufficient to warrant the appointment of an inspector.

The appeal was dismissed.

The appellants appealed a decision regarding the remuneration of a condominium director and an agent.

The Divisional Court held that while s. 28(3) of the Condominium Act requires a specific by-law for the remuneration of directors, s. 28(1)(c) permits the board to remunerate officers and agents without a by-law.

The appeal was dismissed regarding Mr. Sisto, who was remunerated as a director without a by-law.

The appeal was allowed regarding Mr. Cianfarani, an agent of the corporation, as he could be remunerated without a by-law.

The appellant appealed a decision of the Director refusing to issue a certificate of amendment under s. 12 of the Business Corporations Act to change its corporate name.

The Divisional Court dismissed the appeal, finding that the Director properly exercised her discretion in considering the public interest in avoiding confusion and the relative hardship to the parties.

The court exercised its own discretion anew and reached the same conclusion, awarding costs to the respondent.