Corporate/Commercial Law - ONCA

The appellants appealed a summary judgment dismissing their claims for oppression, breach of good faith, and misrepresentation regarding the cost base of certain shares.

The appellants alleged they were not informed that shares were acquired on a tax-deferred basis.

The Court of Appeal upheld the motion judge's finding that the cost base was specifically listed in the circular, which the individual appellant had approved as a director and CFO.

The appeal was dismissed as entirely without merit, with costs awarded to the respondents.

The plaintiff obtained a judgment against a hotel for unpaid marketing invoices.

When the judgment remained unsatisfied, the plaintiff commenced a second action against the hotel's owner and manager.

The motion judge dismissed the second action as an abuse of process, finding the plaintiff's president had purposely withheld evidence about the owner's liability in the first action.

The Court of Appeal allowed the appeal, holding that the motion judge's factual finding was clearly wrong.

The Court further held that in circumstances of joint and several liability, obtaining judgment against one party does not bar a subsequent action against another party, and the second action was not an abuse of process.

The appellant tenant appealed a decision finding that work performed on the leased premises constituted leasehold improvements rather than structural repairs.

The Court of Appeal upheld the trial judge's finding, noting the premises were taken on an 'as is' basis and the tenant failed to obtain the landlord's approval as required by the lease.

The appeal was dismissed.

The appellant appealed an order requiring it to deliver a signed release.

The motion judge had held that releasing an individual partner's 'agents' also released his law firm from vicarious liability for his conduct.

The Court of Appeal disagreed, finding that while a partner is an agent of the firm under the Partnership Act, the firm is not generally an agent of the individual partner.

The appeal was allowed in part to permit the appellant to plead that the law firm was vicariously liable for the partner's conduct.

The original minority shareholder of a closely held corporation brought an oppression action against the majority shareholder and the company.

Due to ill health, he assigned his shares, contractual rights, and the oppression claim to the appellant.

The motion judge and Divisional Court held the assignment of the cause of action was invalid.

On appeal, the Court of Appeal found the assignment valid, as it fell within the exception to the rule against champerty and maintenance because the cause of action was ancillary to the assigned property interest in the shares.

The appellant appealed a trial judgment dismissing its claims for maintenance fees and unjust enrichment.

The Court of Appeal upheld the trial judge's findings that the claim for maintenance fees under an oral contract was statute-barred, as the appellant knew or ought to have known of the non-payment years prior.

The Court also upheld the finding that the appellant's acquiescence barred recovery for unjust enrichment regarding management services.

The appeal was dismissed with costs.

The appellant Noteholders appealed orders approving a bridge loan, a $36 million DIP financing facility, and a Management Incentive Plan (MIP) for the respondent debtor under the CCAA.

The debtor's principal asset was a $3.4 billion arbitration claim against Venezuela.

The Noteholders argued the DIP financing, which could outlast the CCAA protection period and granted the lender a 35% interest in the arbitration proceeds, was effectively an arrangement requiring creditor approval.

The Court of Appeal dismissed the appeal, finding that the supervising judge reasonably exercised his broad discretion under s. 11.2 of the CCAA to approve the financing necessary to pursue the arbitration, and that the financing did not constitute a plan of arrangement.

The appellants appealed a summary judgment granting the respondent possession under a mortgage.

The appellants argued that the respondent was required to advance the full loan amount before acting on any default.

The Court of Appeal dismissed the appeal, finding that the General Security Agreement permitted the respondent to withhold payments upon an event of default, such as the borrowing company's voluntary bankruptcy.

As the remaining funds were not due before the default occurred, the respondent was entitled to move for possession.

The appellants appealed a motion judge's decision that a restrictive covenant in a franchise agreement was not ambiguous to the point of being unenforceable as a pure question of law.

The Court of Appeal dismissed the appeal, finding that the provision was not facially ambiguous when read in the context of the entire agreement, and that any factual ambiguities would need to be determined at trial.

The appellants appealed a decision declaring the respondents were entitled to rescind a second franchise agreement due to the appellants' failure to provide a disclosure document.

The Court of Appeal upheld the application judge's findings that the matter was appropriate for an application, that the second agreement was a 'franchise agreement' under the Arthur Wishart Act triggering disclosure obligations, and that the rescission claim was not statute-barred because the limitation period only began when the franchisor disputed the notice of rescission.

The appellant leased a water heater from the respondent.

The respondent proposed an amendment to the rental agreement requiring customers to deal directly with the respondent to terminate the agreement, rather than using an agent.

The appellant sought a declaration that the amendment was invalid under the Consumer Protection Act.

The Court of Appeal held that the amendment did not comply with the Regulation because the right to terminate was not unconditional.

However, the Court upheld the application judge's decision to invoke s. 93(2) of the Act, binding the appellant to the amendment, as the application was brought for a collateral purpose to benefit a competitor and no consumer was prejudiced.

The appellant insurer appealed a decision finding that its directors and officers insurance policy provided coverage for defence costs incurred by the respondent in an OSC proceeding.

The respondent had previously given notice of potential claims to a prior insurer.

The Court of Appeal upheld the application judge's finding that, viewed objectively, the parties intended the new policy to cover the prior acts referred to in the notice up to the first $5 million of the policy limits.

The court found that the insurer had waived the carve-out provisions in the application and that general exclusion clauses did not override the specific agreement for prior acts coverage.

The appeal and cross-appeal on costs were dismissed.

The appellants appealed a Superior Court judgment regarding a debt and share pledge.

The Court of Appeal dismissed the appeal, finding that the respondent's retention of shares did not extinguish the underlying debt, given his undertaking to return the shares once the principal debt was paid in full.

The court also upheld the trial judge's findings regarding notice of a guarantee.

The respondent commenced an action alleging the appellants fraudulently obtained and illegally transmitted its satellite programming to apartment tenants.

The appellants moved to stay the action under s. 7(1) of the Arbitration Act, relying on an arbitration clause in the residential subscriber agreement.

The Court of Appeal upheld the motion judge's dismissal of the stay, finding the appellants could not invoke the arbitration clause without acknowledging they were parties to it.

The Court also agreed that a partial stay under s. 7(5) was inappropriate as it would cause a multiplicity of proceedings, given that only a few of the 23 defendants were potentially bound by the agreement.

The appellant appealed an order declaring a 'Covenant and Postponement of Claim' valid and enforceable against it.

The appellant argued it was a guarantor, not a principal debtor, and was released from liability due to a failure to receive a demand notice.

The Court of Appeal dismissed the appeal, finding that the specific language of the Covenant precluded the appellant from relying on the lack of notice, and that the appellant had ratified the events that might have otherwise entitled it to release.

The defendants appealed and the plaintiff cross-appealed a trial judgment finding the defendants liable for breach of a settlement agreement and breach of trust under the Construction Lien Act.

The defendants argued that the settlement agreement released the primary corporate defendants from liability, precluding a finding of breach of trust.

The Court of Appeal dismissed the appeal and allowed the cross-appeal, holding that the settlement agreement did not extinguish the primary corporate defendants' liability, as the parent company's liability was as a surety.

The trial judge's judgment was upheld.

The appellant sold a waterjet machine to a debtor and perfected its purchase money security interest by registering under the PPSA.

Unbeknownst to the appellant, the debtor immediately transferred the machine to a related company.

The related company later obtained financing from the respondent, who registered a security interest against the related company's assets.

The Court of Appeal held that the appellant's security interest remained perfected and took priority under s. 48(2) of the PPSA, as the appellant registered a financing change statement within 30 days of learning of the unauthorized transfer.

The appellant's discharge of a separate, unrelated registration against the related company did not unperfect its original security interest.

The appellant landlord appealed an order regarding a commercial lease dispute.

The issues included the commencement date of the lease, the commencement date for parking space rent, and the payment of a leasehold improvements allowance.

The Court of Appeal upheld the application judge's findings that the lease commenced when the demising walls were built and the premises were delivered, and that parking rent commenced when the parking spaces were turned over.

The court amended the order on consent to direct the leasehold improvements allowance to be paid directly to the sub-tenant.

The appeal was otherwise dismissed.

The appellant appealed a trial judgment dismissing its claim for breach of contract.

The appellant argued that a preliminary contract was formed when it submitted a proposal, or alternatively, that an oral contract was formed during a phone call.

The Court of Appeal dismissed the appeal, finding no palpable and overriding error in the trial judge's factual conclusions that a purchase order was required to form a contract and that the phone call did not constitute offer and acceptance.

The appellant appealed an order enforcing a monetary judgment from a Michigan court.

The Court of Appeal upheld the motion judge's finding that the appellant had attorned to the jurisdiction of the Michigan court, which gave the Ontario court jurisdiction to enforce the judgment.

The court also found that the narrow exceptions to enforcement set out in Beals v. Saldanha did not apply.

The appeal was dismissed with costs.