Paul Emerson

Franchisee plaintiffs commenced a proposed class proceeding alleging that the franchisor breached disclosure obligations and interfered with franchisees’ statutory right to associate under the Arthur Wishart Act (Franchise Disclosure), 2000 after converting exclusive territories to non‑exclusive territories.

The franchisor moved to stay the action based on arbitration clauses contained in the franchise agreements.

The plaintiffs argued the statutory right to associate under the Arthur Wishart Act encompassed the right to pursue a class action and therefore invalidated the arbitration clause.

The court held that the Act does not manifest legislative intent to override arbitration agreements and that s. 7 of the Arbitration Act, 1991 requires enforcement of such clauses absent explicit statutory intervention.

Applying Seidel v. TELUS Communications Inc., the court concluded the disputes must proceed by arbitration and stayed the proposed class proceeding.

The insured corporation sought a declaration that its directors’ and officers’ liability insurer was obligated to indemnify it for defence costs and settlement payments arising from Ministry of Labour enforcement proceedings under the Employment Standards Act, 2000.

Former employees of a predecessor company claimed termination and related entitlements, and the Ministry determined that the insured corporation was a related employer under s. 4 of the Act and jointly and severally liable.

The insurer denied coverage, arguing that no claim had been made against the insured or any insured person during the policy period and that the alleged conduct did not constitute a covered wrongful act.

The court held that a claim had been made during the policy period because the Ministry was investigating and pursuing the corporation and its director for liability.

The court further held that liability as a related employer for wrongful dismissal constituted an “Employment Practices Wrongful Act” within the policy and was not excluded by the termination notice exclusion.

The insurer was therefore obligated to indemnify the insured for its losses.

The defendants brought a motion seeking to stay an Ontario action alleging negligence in the provision of legal services relating to litigation in North Carolina.

The plaintiff argued that Ontario had jurisdiction because it was present in Ontario and allegedly sustained damages there.

Applying the real and substantial connection test articulated in Club Resorts Ltd. v. Van Breda, the court found that none of the presumptive connecting factors linked the dispute to Ontario.

The alleged negligence occurred in North Carolina, the defendants were based there, and the relevant contract and witnesses were located in the United States.

The court concluded that Ontario lacked jurisdiction simpliciter and that, in any event, North Carolina was the clearly more appropriate forum.