Corporate/Commercial Law - ONCA

The appellants appealed a trial judgment interpreting a contractual provision that reduced payments to a departing shareholder who took business from the respondent.

The Court of Appeal upheld the trial judge's interpretation, finding it gave commercial efficacy to the provision.

However, the Court varied the trial judge's costs order, finding that the minutes of partial settlement precluded the respondent from recovering costs for most claims prior to the settlement date.

The respondent's cross-appeal regarding several liability was dismissed.

No costs were awarded for the appeal.

The appellant insurer appealed a trial judgment finding it liable under an errors and omissions policy, arguing the insured's conduct fell within the 'intentional wrongful act' exemption.

The Court of Appeal dismissed the appeal, holding that the exemption applies to intentional torts, not deliberate acts of negligence, and upheld the trial judge's finding that the insured did not intend economic harm.

The Court also rejected the appellant's argument that prejudgment interest should run from the date of the current action rather than the underlying action, as the policy obligated the payment of interest from the commencement of the underlying action.

The plaintiffs contracted with the defendant moving company to move and store their household goods.

The defendant assured the plaintiffs that their goods would be secure in a locked trailer on the defendant's lot.

However, the trailer was left unattended on a public street overnight and was stolen.

The defendant admitted liability but sought to rely on a limitation of liability clause limiting damages to $0.60 per pound.

The trial judge found the clause unenforceable.

The Court of Appeal upheld this decision, finding that enforcing the limitation clause would be unconscionable given the false assurances of security.

The appeal was allowed only to set aside damages awarded to the plaintiffs' corporations.

The appellants appealed a trial judgment holding them liable for losses in a short sale margin account.

The primary debtor opened the account and the co-appellant guaranteed it.

The appellants argued the investment dealer owed a fiduciary duty to the guarantor and breached a duty of full disclosure by failing to disclose that the primary debtor had not posted the required margin security.

The Court of Appeal dismissed the appeal, upholding the trial judge's findings that there was no fiduciary relationship and that the non-disclosure was not material, as the guarantor knew the account was in a loss position and that he was securing that loss.

The interveners appealed a trial judgment concerning a dispute over the assets of The Holy Virgin Church.

The Court of Appeal upheld the trial judge's finding that proposed by-law amendments were governed by the approval requirements in the Normal Parish By-laws, noting that the dispute was fundamentally religious and outside the court's purview.

However, the Court allowed the appeal in part, finding that the trial judge improperly exercised his discretion under s. 106 of the Canada Corporations Act to order a meeting, as the power struggle between factions did not constitute extraordinary circumstances making a meeting impracticable.

The appellant mortgagee appealed the dismissal of its action against a guarantor on summary judgment.

The motions judge had found that the guarantor was discharged due to a change in the principal contract.

The Court of Appeal allowed the appeal, holding that the sale of shares of the principal debtor corporation to third parties did not vary the contract between the principal debtor and the mortgagee, nor did it breach the guarantee contract.

The appellant was granted summary judgment on the guarantee in the amount of $869,091.18.

The appellant landlord appealed a decision interpreting a Lease Extension and Amending Agreement.

The application judge held that the agreement extended a restrictive covenant in favour of the tenant for the full term of the agreement.

The Court of Appeal found no error, noting that the agreement confirmed the restrictive covenant remained unchanged except as modified, and the only relevant modification was the definition of the term, extending it to 16 years and 7 months.

The appeal was dismissed with costs.

The tenant held a commercial lease containing an option to purchase the shopping centre.

The tenant subsequently subleased the premises for the entirety of the term.

The landlord sought a declaration that the option to purchase was no longer exercisable by the tenant, arguing the sublease constituted an assignment in law that carried the option with it.

The application judge granted the declaration.

On appeal, the Court of Appeal reversed, holding that while a sublease for the entire term may be an assignment in law, an option to purchase is severable and does not automatically pass with the assignment if the parties intended otherwise.

The court found the parties clearly intended to preserve the option with the tenant.

The appellants appealed an order appointing the respondent as receiver of two corporations, alleging a conflict of interest due to the respondent's role as trustee in bankruptcy for related parties.

The Court of Appeal first determined it had jurisdiction, finding the appointment order was final rather than interlocutory.

The Court admitted fresh evidence—a statement of defence filed by the respondent in related litigation—which crystallized a pervasive conflict of interest.

Consequently, the Court allowed the appeal, set aside the order appointing the receiver, and referred the matter back to the Commercial List Court, also setting aside the provision granting priority to the receiver's fees.

The respondent consigned a boat to a marine dealership, which sold it to the appellant for $46,000 without the respondent's authorization.

The dealership went bankrupt without remitting the proceeds.

The respondent sued the appellant for the return of the boat or its value, and was granted summary judgment.

On appeal, the Court of Appeal reversed the decision, finding that the appellant was a good faith purchaser without notice of the dealership's lack of authority.

The court held that section 2(1) of the Factors Act protected the appellant, as it does not impose a due diligence requirement on purchasers to inquire into a mercantile agent's authority.

The appellants appealed a motions judge's finding that the respondent was forced to withdraw from their partnership, constituting a de facto expulsion.

The Court of Appeal upheld the motions judge's interpretation of the partnership agreement, finding that Articles 3.5 and 8.1 required payment of the Schedule 'A' price to the departing partner upon involuntary withdrawal or expulsion.

The appeal was dismissed with costs awarded to the respondent.

The appellants appealed a trial judgment regarding the wrongful distribution of corporate assets to themselves, to the detriment of the respondent shareholder.

The appellants argued the judgment should be set aside because the trial judge had also conducted the pre-trial conference, contrary to Rule 50.04.

The Court of Appeal dismissed the appeal, finding the appellants had explicitly waived any objection to the trial judge presiding and suffered no prejudice.

The Court also upheld the trial judge's findings on the wrongful distribution of assets and the imposition of liability on the appellants under the oppression remedy provisions of the Business Corporations Act.

The appellant appealed a summary judgment requiring it to pay $135.5 million in cash to fulfill its obligations under a letter agreement.

The appellant argued the motion judge erred by restricting payment to cash rather than allowing payment in shares of certain corporations as provided in the agreement.

The Court of Appeal dismissed the appeal, agreeing with the motion judge that the respondent was entitled to reject the offered shares as not being of equivalent value, and finding that allowing payment in shares years after the deadline would inappropriately rewrite the agreement.

The Vernon companies hired Headline, an auctioneering firm, to sell assets.

Headline breached the agreement by failing to deposit over $100,000 into a joint account and breached its fiduciary duty by attempting to secretly sell assets to its own companies.

The Vernon companies subsequently refused to allow Headline to sell the remaining assets.

The Court of Appeal held that Headline's substantial breach of contract and fiduciary duty excused the Vernon companies from further performance.

The Court restored the trial judge's award of $5,000 in punitive damages against Headline for its high-handed and arbitrary conduct.

The appellant appealed a trial judgment awarding the respondent commissions for breach of contract.

The respondent had entered into an 11-month contract with the appellant to provide customs consulting services.

The trial judge found that the contract entitled the respondent to commissions for clients he acquired, even after the contract expired.

The Court of Appeal dismissed the appeal, finding no reversible error in the trial judge's interpretation that the agreement provided for commissions beyond the fixed term.

A dissenting opinion argued that commissions should only be payable for work done during the contractual term.

The appellant appealed an order allowing the respondents to proceed to trial on all claims after a default judgment was set aside.

At the initial trial, the judge dismissed the respondents' claims for interference with contractual and economic relations but granted an injunction and damages for false and misleading advertising.

The Court of Appeal held that issue estoppel precluded the respondents from relitigating the dismissed interference claims, even though the default judgment against the appellant was set aside.

However, the Court allowed the false and misleading advertising claims to proceed to trial for both an injunction and damages.

The appeal was allowed in part.

The parties appealed and cross-appealed a trial judgment arising from the dissolution of their horse business relationship.

The Court of Appeal allowed the appeal, finding the trial judge erred in awarding unjust enrichment for foal expenses, dismissing the claim for purse monies, overcompensating for a horse's reduced value, and denying damages from an interlocutory injunction.

The court also awarded the appellant solicitor and client costs based on a Rule 49 offer to settle.

The cross-appeal was allowed in part to grant the respondent pre-judgment interest.

The parties entered into a sale agreement containing an arbitration clause that precluded appeals.

A dispute arose, and a subsequent tripartite arbitration agreement was signed to include a third party.

The appellant's claim was dismissed at arbitration, and it sought leave to appeal under section 45(1) of the Arbitration Act, 1991.

The application judge held that the original sale agreement governed and precluded an appeal.

The Court of Appeal allowed the appeal, finding that the subsequent arbitration agreement was a free-standing agreement that governed the arbitration, thereby permitting the appellant to seek leave to appeal.

The appellants appealed a trial judgment, arguing the trial judge erred in concluding they waived their right to sue for damages arising from a secret $50,000 payment because the doctrine of waiver was not pleaded.

The Court of Appeal dismissed the appeal, noting the trial judge alerted the appellants to the issue prior to argument, no objection was raised, and the appellants tolerated the circumstances for three years.

The court found no substantial wrong or miscarriage of justice.

The appellant insured suffered a theft of equipment and subsequently made a claim for loss of income.

The respondent insurer denied the claim on the basis that it was barred by a one-year limitation period set out in the policy's conditions.

The appellant argued that the limitation period, which mirrored the statutory conditions for fire insurance under the Insurance Act, did not apply to theft or loss of profits, and that the late delivery of the policy prejudiced its ability to claim.

The Court of Appeal upheld the summary judgment dismissing the action, finding that the insurer was free to incorporate the one-year limitation period into the contract for all perils, and that the contractual language was clear and unambiguous.

The court also found no prejudice from the late delivery of the policy, as the appellant's adjuster had misinterpreted the policy rather than being unaware of it.