Court File and Parties

Court File No.: CV-19-00614920-00CL Date: 20190717 Ontario Superior Court of Justice

Between: ARTHUR CORBER Applicants – and – MICHAEL HENRY, FAIGIE KOPELMAN and 1192922 ONTARIO LIMITED Respondents

Counsel: Warren Rapoport, for the Applicant Brendan van Niejenhuis and Emily Quail, for the Respondents, Faigie Kopelman and Michael Henry

Before: V.R. CHIAPPETTA J.

Reasons for Costs

[1] With reasons for judgment dated June 7, 2019, I dismissed the application for oppression remedy under section 248 of the Ontario Business Corporation Act, R.S.O. 1990, c. B. 16, and in the matter of section 101 of the Courts of Justice Act, R.S.O. 1990, c. C. 43, wherein the applicant alleged oppressive or unfair conduct on behalf of the respondents (Corber v. Henry 2019 ONSC 3518). The respondents were successful on all issues before the court. They seek their costs of the application.

[2] The respondents submit that a substantial indemnity costs award is warranted. This is the applicant’s second oppression application brought on fundamentally the same facts, it is argued, and both applications were unwarranted.

[3] In the alternative, the respondents submit that substantial indemnity costs are appropriate for the time running from April 25, 2019. On April 25, 2019, the respondents made a comprehensive offer to settle the proceeding on terms substantially more favourable to the applicant than he was able to secure on the contested application. Following a judicial mediation with Justice Conway, the respondents offered to purchase Mr. Corber’s shares outright for $1.8M. To protect against his stated concern that the respondents could simply turn around and sell the property for $13.5M or more, the offer guaranteed Mr. Corber a declining balance participation interest in such a sale for the next four years. The offer was rejected and no formal counter-offer was advanced by the applicant.

[4] The applicant submits that the respondents should be denied the benefit of a costs award despite their undeniable and complete success on the application as, in effect, “the applicant is in a corporate prison of which the respondents hold the keys.” The applicant is one of an odd number of shareholders in a single purpose corporation, operating without a shareholders’ agreement. This is a function of his own decisions many years ago, not as a consequence of his failed application or the conduct of the respondents in defending it. The corporate reality has been created in part by the applicant’s own choices and is irrelevant to the assessment of costs of the application.

[5] The bill of costs submitted by the respondents details the hours employed to respond to the application and the corresponding rates charged per hour, by identified lawyer. In my view, both the hours employed and rates charged per lawyer are reasonable and to be expected, considering the complexity of the issues argued on the commercial list in Toronto, the importance of the issue for both parties, the urgency by which the litigation was pushed forward by the applicant and the judicial mediation that developed.

[6] I do not agree that it is fair to award substantial indemnity costs at large. A further offer to purchase the property was made and the applicant relied on allegations of conduct further to those alleged in the first oppression application. It is fair and reasonable, in my view, however, to award substantial indemnity costs subsequent to the April 25, 2019 offer. The offer was as a result of a judicial mediation. It was detailed, comprehensive and more favourable to the applicant than the dismissal of his application. The applicant made no formal counter offer and instead rejected the offer outright.

[7] Having considered the factors enumerated by Rule 57.01 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, and for reasons set out above, I have concluded that it is a fair and reasonable exercise of my discretion to award the respondents the costs of the application fixed at $66,148.84 inclusive.

V.R. Chiappetta J. Released: July 17, 2019

Court File and Parties (Duplicate Section)

Court File No.: CV-19-00614920-00CL Date: 20190717 Ontario Superior Court of Justice

Between: ARTHUR CORBER Applicants – and – MICHAEL HENRY, FAIGIE KOPELMAN and 1192922 ONTARIO LIMITED Respondents

Reasons for Costs (Duplicate Section)

V.R. Chiappetta J.