The Catalyst Capital Group Inc. v. Moyse et al.

[Indexed as: Catalyst Capital Group Inc. v. Moyse]

Ontario Reports

Court of Appeal for Ontario,

Hoy A.C.J.O., MacFarland and Lauwers JJ.A.

November 17, 2015

127 O.R. (3d) 625 | 2015 ONCA 784

Case Summary

Courts — Jurisdiction — Final or interlocutory order — Plaintiff appealing dismissal of its motion for declaration that defendant was in contempt of court for failing to preserve electronic records — Order in question interlocutory — Appeal lying to Divisional Court under s. 19(1)(b) of Courts of Justice Act — Courts of Justice Act, R.S.O. 1990, c. C.43, s. 19(1)(b). [page626]

The plaintiff sued the defendant, a former employee, after he accepted employment with a competitor of the plaintiff's. An order was made in that action requiring the defendant to preserve certain electronic records. The plaintiff moved unsuccessfully for a declaration that the defendant was in contempt of that order. The plaintiff appealed to the Court of Appeal. The defendant moved to quash the appeal for lack of jurisdiction.

Held, the motion should be granted.

The order in question was interlocutory. It was not effectively final on the basis that the motion judge's decision that the defendant's conduct did not contravene the order would be res judicata at trial. The motion judge had simply concluded that the plaintiff had not proven, beyond a reasonable doubt, that the defendant had breached the order. While the finding that the defendant was not in contempt could not itself be relitigated at trial, the plaintiff would be free to explore what the defendant did with his computer and why he did it. The order was appealable to the Divisional Court, with leave, under s. 19(1)(b) of the Courts of Justice Act.

Simmonds v. Simmonds (2013), 117 O.R. (3d) 479, [2013] O.J. No. 4680, 2013 ONCA 479, apld

Other cases referred to

Hendrickson v. Kallio, 1932 CanLII 123 (ON CA), [1932] O.R. 675, [1932] O.J. No. 380, [1932] 4 D.L.R. 580 (C.A.); Pimiskern v. Brophey, [2013] O.J. No. 505, 2013 ONSC 572 (S.C.J.); Sanbourin and Sun Group of Companies v. Laiken (2013), 116 O.R. (3d) 641, [2013] O.J. No. 3891, 2013 ONCA 530; Waldman v. Thomson Reuters Canada Ltd., [2015] O.J. No. 395, 2015 ONCA 53, 127 C.P.R. (4th) 401, 330 O.A.C. 142, 71 C.P.C. (7th) 33, 249 A.C.W.S. (3d) 251

Statutes referred to

Courts of Justice Act, R.S.O. 1990, c. C.43, s. 19 [as am.], (1)(b) [as am.]

MOTION to quash an appeal.

Rocco Di Pucchio, for appellant/responding party.

Kristian Borg-Olivier and Denise Cooney, for respondents/moving party Brandon Moyse.

Andrew Carlson, for respondents/moving party West Face Capital Inc.

The judgment of the court was delivered by

[1] LAUWERS J.A.: — The motion judge dismissed the motion of Catalyst Capital Group Inc. for a declaration that its former employee, Brandon Moyse, is in contempt of the July 16, 2014 order of Firestone J. for failing to preserve certain electronic records relating to Catalyst.

[2] The moving party, Mr. Moyse, seeks to quash Catalyst's appeal on the basis that the judgment appealed from is interlocutory and therefore falls within the jurisdiction of the Divisional Court under s. 19 of the Courts of Justice Act, R.S.O. 1990, c. C.43. For the reasons set out below, I would quash the appeal. [page627]

Factual Background

[3] Mr. Moyse is a former employee of Catalyst. He accepted employment with a competitor of Catalyst. Catalyst was concerned that he had or would impart its confidential information to his new employer.

[4] Eventually, on Catalyst's motion, Firestone J. issued an interim consent order for injunctive relief, dated July 16, 2014. The court ordered that "Moyse and [his new employer], and its employees, directors and officers, shall preserve and maintain all records in their possession, power or control, whether electronic or otherwise, that relate to Catalyst." Paragraph 5 of this order provided:

THIS COURT FURTHER ORDERS that Moyse shall turn over any personal computer and electronic devices owned by him or within his power of control (the "Devices") to his counsel, Grosman, Grosman and Gale LLP, ("GGG") for the taking of a forensic image of the data stored on the Devices (the "Forensic Image"), to be conducted by a professional firm as agreed to between the parties.

[5] Catalyst brought a motion for a declaration that Mr. Moyse was in contempt of the consent order.

Motion Judge Found no Contempt

[6] The motion judge's reasons set out a lengthy review of the evidence. He was unable to find "beyond a reasonable doubt" that Catalyst had established that Mr. Moyse was in contempt. His specific findings are relevant to Catalyst's argument on this motion to quash.

[7] With respect to Mr. Moyse's actions in deleting the personal browsing history from his computer, the motion judge found, at para. 69: "there is no evidence to establish, beyond a reasonable doubt, that Moyse deleted relevant information as a result of deleting his personal browsing history and then running a registry cleaner to delete traces of the internet searches".

[8] With respect to Mr. Moyse's conduct in buying and using software to "scrub" files from his personal computer before delivering it, the motion judge stated, at para. 86:

I cannot find that the above evidence supports a finding, beyond reasonable doubt, that Moyse breached the Consent Order by scrubbing relevant files with the Secure Delete program. There still remained 833 relevant documents on his computer, as well as the evidence on his computer of the ASO program, the Secure Delete folder, and the purchase receipts. The evidence is at least as consistent with Moyse's evidence that he loaded the ASO software and investigated the products it offered and what the use would entail, but he did not run the Secure Delete program. [page628]

Analysis

[9] Mr. Moyse argues that an order dismissing a contempt motion is interlocutory for the purpose of an appeal, and therefore lies to the Divisional Court, with leave, under s. 19(1)(b) of the Courts of Justice Act. He relies on this court's brief endorsement in Simmonds v. Simmonds (2013), 117 O.R. (3d) 479, [2013] O.J. No. 4680, 2013 ONCA 479, which was an appeal from an order of a motion judge dismissing a motion for a finding of contempt against the respondent's spouse in a family dispute. There, the motion judge found that the respondent had complied with the disclosure order in question. In Simmonds, this court accepted the respondent's argument that while an order finding contempt is final, the dismissal of the motion for contempt was interlocutory: the motion judge's finding was not binding on the trial judge. The court rejected the conclusion to the contrary found in Pimiskern v. Brophey, [2013] O.J. No. 505, 2013 ONSC 572 (S.C.J.).

[10] Catalyst argues that the ruling precedent is this court's decision in Sabourin and Sun Group of Companies v. Laiken (2013), 116 O.R. (3d) 641, [2013] O.J. No. 3891, 2013 ONCA 530, in which the court heard an appeal from a decision dismissing a contempt motion. That case was about the possible breach of a Mareva injunction. I observe that the court did not advert to the interlocutory/final distinction or to the question of jurisdiction at all. The issue appears not to have been argued.

[11] In fairness to the parties, this court's decisions on the final/interlocutory distinction have not been models of clarity. Much ink has been spilled, and court and counsel time wasted in exploring the nuances. But the root principle that all can and do accept was expressed by Middleton J.A in Hendrickson v. Kallio, 1932 CanLII 123 (ON CA), [1932] O.R. 675, [1932] O.J. No. 380 (C.A.) [at para. 20]:

The interlocutory order from which there is no appeal is an order which does not determine the real matter in dispute between the parties -- the very subject matter of the litigation, but only some matter collateral. It may be final in the sense that it determines the very question raised by the applications, but it is interlocutory if the merits of the case remain to be determined.

[12] This important case is one to which this court frequently returns. See, for example, Waldman v. Thomson Reuters Canada Ltd., [2015] O.J. No. 395, 2015 ONCA 53, per MacFarland J.A., at para. 22. On the Hendrickson v. Kallio test, there can be no doubt that the dismissal of the contempt motion is interlocutory. The merits of the case remain to be determined. [page629]

[13] But Catalyst drills deeper and argues that in this case the outcome of the motion is effectively final in a significant dimension. It submits that the important point for the court to keep in mind is that it would not be open to a party who was unsuccessful in a contempt motion to revisit the contempt motion at trial. Counsel argues that the motion judge's decision that Mr. Moyse's conduct did not contravene the order is res judicata, and Mr. Moyse's conduct in deleting the browser history, for example, "can't be re-litigated even in cross-examination". It is therefore final in the sense contemplated by the Courts of Justice Act.

[14] I disagree. The motion judge's findings are clear. He simply concluded that Catalyst had not proven, beyond a reasonable doubt, that Mr. Moyse breached Firestone J.'s order. There is nothing in the motion judge's decision that would prevent Catalyst from exploring, in Mr. Moyse's cross-examination at discovery or at trial, what he did with his computer, when he did it, why he did it, who assisted him (if anyone), how he did it and for what purpose or purposes. While the finding that Mr. Moyse was not in contempt may not itself be relitigated, barring some new revelation, all of the factual issues between the parties may be fully and exhaustively explored at any discovery and at the trial.

[15] In the circumstances of this appeal, the principle in Simmonds applies. The order dismissing the contempt motion against Mr. Moyse is interlocutory, and therefore appealable to the Divisional Court, with leave, under s. 19(1)(b) of the Courts of Justice Act.

[16] I would quash the appeal without prejudice to Catalyst's right to seek leave to appeal to the Divisional Court. I would award Mr. Moyse costs fixed in the agreed amount of $5,000, all inclusive.

Motion granted.

End of Document