Court of Appeal for Ontario

Date: 20211118 Docket: C69137

Fairburn A.C.J.O., Roberts J.A. and Van Melle J. (ad hoc)

In the matter of Section 101 of the Courts of Justice Act, R.S.O. 1990 c.C.43, as amended, and in the matter of Section 243(1) of the Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, as amended

BETWEEN

Royal Bank of Canada Applicant

and

Mundo Media Ltd., Mundo Inc., 2538853 Ontario Ltd., 2518769 Ontario Ltd., 2307521 Ontario Inc., 36 Labs, LLC., Active Signal Marketing, LLC, Find Click Engage, LLC, Fli Digital, Inc., Mundo Media (US), LLC, M Zone Marketing Inc., Appthis Holdings, Inc., Movil Wave S.A.R.L., Mundo Media (Luxembourg) S.A.R.L., and Mogenio S.A. Respondents

Counsel: Richard Howell and David Schatzker, for the appellant Vdopia Inc. Scott McGrath and Rachel Bengino, for Ernst & Young Inc., in its capacity as court-appointed receiver in the within proceeding

Heard and released orally: November 12, 2021 by video conference

On appeal from the order of Justice Glenn A. Hainey of the Superior Court of Justice, dated January 18, 2021.

Reasons for Decision

[1] The appellant, Vdopia Inc., appeals the order requiring it to pay the amount of US$373,731.23 to the Court-appointed receiver and manager of the respondents. This amount represents unpaid accounts for advertising services that were rendered to the appellant prior to the receivership order.

[2] The appellant’s principal submission is that the motion judge erred in granting this order in light of the fact that the appellant has an outstanding counterclaim for equitable set-off. The appellant maintains that its counterclaim, if successful, will eliminate or at least greatly reduce any indebtedness that it may have.

[3] We see no error. The motion judge’s finding of the appellant’s indebtedness is firmly grounded in the record. The motion judge clearly addressed the set-off issue in paragraph 7 of his endorsement, finding that the appellant had failed to adduce any evidence to support that claim, notwithstanding it had ample notice of the Receiver’s position with respect to the amount owing. The motion judge was correct; there was no evidence supporting the appellant’s claim for set-off.

[4] There is no basis to interfere with the motion judge’s order. Accordingly, the appeal is dismissed. We also see no basis to stay the enforcement of the motion judge’s order.

[5] The Receiver and Manager, Ernst & Young, is entitled to its costs of the appeal payable within 30 days by the appellant in the amount of $8,500, inclusive of disbursements and applicable taxes.

"Fairburn A.C.J.O"

"L.B. Roberts J.A."

"Van Melle, J. (ad hoc)"