Court of Appeal for Ontario

Citation: Research Capital Corporation v. Skyservice Airlines Inc., 2009 ONCA 418

Date: 2009-05-20

Docket: C49009

Before: Lang, Juriansz and Watt JJ.A.

Between:

Research Capital Corporation Plaintiff

and

Skyservice Airlines Inc., Skyservice Investments Inc., Gibralt Capital Corporation, 6756140 Canada Inc., 6806929 Canada Inc., Russell Payson, Timothy Casgrain, Marshall Myles, Rob Guguere, Ron L. Platmore and Thomas W. Cryer Defendants (Respondents)

Counsel:

David Stevens, for the appellant

Gavin Smyth, for the respondents, Skyservice Airlines Inc., Gibralt Capital Corporation, 6756140 Canada Inc., 6806929 Canada Inc., Russell Payson, Timothy Casgrain, Marshall Myles, Rob Guguere, Ron L. Platmore and Thomas W. Cryer

Julie Rosenthal, for the respondent, Skyservice Investments Inc.

Heard and released orally: May 13, 2009

On appeal from the order of Justice Beth A. Allen of the Superior Court of Justice dated June 19, 2008.

ENDORSEMENT

[1] In their facta, the appellant and the respondents agree that the order reflecting the motion judge’s decision erroneously struck the appellant’s misrepresentation claim against Gibralt Capital Corporation (Gibralt) and Skyservice Airlines Inc. (Skyservice). Accordingly, paragraph 2(b) of the motion judge’s order is amended to strike the claim for misrepresentation against all the defendants other than Gibralt and Skyservice.

[2] There are three remaining challenges to the motion judge’s reasons. In those challenges, the appellant does not take issue with the motion judge’s decision to strike portions of the pleading, but argues that she erred in refusing or restricting leave to amend certain aspects of the appellant’s claim. The appellant also does not take issue with the principles of law relied upon by the motion judge, but rather with her application of those principles to the claim.

[3] First, the appellant challenges the motion judge’s decision that any subsequent amendment to one portion of the claim must “exclude reference to facts and allegations known to [the appellant] before the approval proceeding.” We agree with the appellant that that exclusion is overly broad since it extends to all facts within the appellant’s knowledge at the specified time. The restriction should be amended to exclude reference to facts and allegations that would amount to a collateral attack on the approval decision or arrangement.

[4] Second, the appellant challenges the motion judge’s decision to strike paras. 36-40 of the claim, which the motion judge determined contained improper references to May 2007 meetings. These references were struck on the basis that they improperly pled settlement discussions. Based on the pleading that a specific classic settlement question was raised at the initial meeting (“how much will it take to satisfy” the demands to resolve the outstanding action?), we agree with the motion judge’s characterization of the meetings as settlement discussions and her decision to refuse leave to amend this aspect of the claim.

[5] Third, the appellant challenges the motion judge’s decision to refuse leave to amend its oppression claim. We see no error in the motion judge’s conclusion that the appellant’s allegations arise from an alleged breach of contract. Accordingly, we would not give effect to this ground of appeal.

[6] Accordingly, we would dismiss the appeal except to the extent of amending para. 2(b) as indicated in para. 1 of these reasons. We would also replace the words “reference to facts and allegations known to the Plaintiff before the proceeding in which Skyservice Airlines Inc.’s Arrangement was approved” in para. 1(b) of the order with “reference to facts and allegations that amount to a collateral attack on the approval of Skyservice Airlines Inc.’s Arrangement.”

[7] The parties have agreed that the appellant will pay costs fixed in the amount of $10,000 to the respondents other than Skyservice Investments Inc. and $2,000 to the respondent Skyservice Investments Inc., both amounts inclusive of disbursements and Goods and Services Tax.

“S.E. Lang J.A.”

“R.G. Juriansz J.A.”

“David Watt J.A.”