Peter J. Cavanagh

The plaintiffs brought a motion for default judgment after the defendants were noted in default in an action alleging fraudulent inducement to invest in purported real estate development projects.

The court reviewed the deemed admissions under Rule 19.02 and the evidentiary record to determine whether the facts established liability for fraudulent misrepresentation.

Default judgment was granted against one individual defendant and related corporate entities for specific investments where the plaintiffs proved reliance on knowingly false representations in promotional materials.

Claims relating to other investments and claims against another individual defendant were directed to proceed to an undefended trial due to insufficient pleaded or evidentiary support.

The court also awarded punitive damages against the primary individual defendant and directed further submissions on costs.

Seven spirits suppliers brought an application challenging the enforceability of section 14 of the LCBO's standard purchase order Terms and Conditions — a "most favoured customer" no-price-discrimination clause — after the LCBO assessed approximately $35.9 million in chargebacks by way of set-off for breaches of the provision.

The applicants raised multiple grounds: ultra vires, statutory illegality, restraint of trade, unenforceable penalty/unconscionable forfeiture, waiver, estoppel by convention, bad faith, and unjust enrichment.

The court rejected all grounds, holding that section 14 falls squarely within the LCBO's statutory mandate to buy and sell liquor as a wholesaler and retailer, is not prohibited by statute, does not restrain trade, is not an unenforceable penalty, was not waived, and was not the subject of a shared assumption with suppliers that it would not be enforced.

The application was dismissed.

A vacant land condominium corporation sought damages and disgorgement of profits against its former directors and various defendants, alleging breach of fiduciary duty in connection with the release of easements burdening adjacent land.

The plaintiff claimed the directors received secret benefits in exchange for facilitating the release of easements valued at approximately $31.5 million.

The court found that the corporation was contractually obligated to release the easements pursuant to easement release provisions in registered agreements, and that the plaintiff failed to prove the directors received secret benefits or breached their fiduciary duties.

The court dismissed the plaintiff's claim and the counterclaim.

The defendants moved to strike the plaintiffs' amended statement of claim on the ground that it discloses no reasonable cause of action.

The court found that the plaintiffs failed to adequately plead the existence of a partnership relationship between the individual plaintiff and the defendants, failed to plead the material facts necessary to establish breach of contract claims with the required clarity and precision, and failed to plead the essential elements of various tort claims including tortious interference with economic interests, breach of fiduciary duty, breach of duty of good faith, unjust enrichment, conspiracy, negligence, and negligent misrepresentation.

The court granted the motion to strike and struck out the amended statement of claim, but granted leave to amend within 45 days.

The court considered an application by InFrontier AF LP to recognize and enforce an arbitral award issued in its favour by a Dubai-based arbitrator under the Dubai International Arbitration Centre (DIAC) Rules.

The respondent, Roeen Rahmani, opposed the application, arguing that the arbitration was not conducted in accordance with the parties’ agreement, that he was denied a fair hearing, and that enforcement would be contrary to Ontario public policy.

The court found that, due to legislative changes in Dubai, the DIAC Rules properly replaced the DIFC-LCIA Rules referenced in the parties’ agreement, and that the respondent had not established any procedural unfairness or public policy violation.

The application to recognize and enforce the award was granted.

The decision concerns a motion by Saad Aljabri and related parties for leave to issue a counterclaim in a complex civil action.

The court dismissed the motion, finding that the proposed counterclaim for abuse of process and conspiracy was statute-barred under Ontario law, and that the applicants failed to prove that Saudi law applied or that any exception to the limitation period existed.

The court also found that the proposed claims for declaratory relief against additional parties were not supported by a tenable cause of action.

The risk of prejudice to the plaintiffs, including loss of the scheduled trial date and increased costs, further supported dismissal.

The decision grants the motion of Saad Khalid S. Al Jabri for leave to issue a commission and letters of request to obtain evidence from witnesses outside Ontario for use at trial.

The court finds that the anticipated evidence of the proposed witnesses is material to issues in the action, and that the request is bona fide.

The ruling addresses the test for issuing commissions and letters of request, emphasizing the importance of a fair and full trial, and applies the test to several categories of proposed witnesses, including alleged co-conspirators, foreign officials, and counterterrorism experts.

The decision addresses a motion by Saad Aljabri, Mohammed Aljabri, and various corporate defendants to vary Mareva orders freezing their worldwide assets, seeking the release of frozen funds to pay legal fees.

The court grants the motion for all moving parties except Dreams International Advisory Services Ltd., finding that the Mareva Defendants have shown they lack access to other assets or reliable third-party funding, and that a variation is necessary to ensure a fair trial.

The court dismisses the motion by Dreams, finding insufficient evidence that it lacks access to other funds.

The decision reviews the legal test for varying Mareva orders and applies a balancing of interests, including the merits of the case, the complexity of the litigation, and the conduct of the parties.

This decision addresses a motion by the plaintiffs for production and directions regarding claims of privilege over thousands of documents and answers to questions refused on discovery in a complex, multi-party commercial litigation.

The court reviews the legal principles governing solicitor-client privilege, litigation privilege, and common interest privilege, and applies them to various categories of documents and questions.

The court provides detailed directions on the production of documents, the sufficiency of evidence to support privilege claims, and the process for resolving ongoing disputes about privilege.

The plaintiffs brought a motion seeking a declaration that a document ("the Proffer") provided by the defendant to the Attorney General for Canada (AGC) under s. 38 of the Canada Evidence Act was not subject to privilege or that any such privilege had been waived, and an order for its production.

The defendant asserted litigation privilege.

The court found that the Proffer was created for the dominant purpose of preparing for litigation, making it presumptively protected by litigation privilege.

The court further held that the disclosure of the Proffer to the AGC, being a statutory compulsion, did not constitute a voluntary waiver of privilege, nor did fairness and consistency require waiver.

The plaintiffs' motion was dismissed.

The court determined the priority dispute between KingSett Mortgage Corporation's 2022 mortgage and various construction liens against the Debtors' property, which was in receivership.

The Receiver brought the motion to clarify "Priority Payables" under a court-approved sale agreement.

The court found that the 2022 KingSett Mortgage had priority over the construction liens, except to the extent of any deficiency in the statutory holdbacks, applying sections 78(2) and 78(6) of the Construction Act.

The court rejected the lien claimants' arguments that the mortgage did not qualify for priority under these sections and that the Receiver acted inappropriately.

The applicant, Johnson Bros.

Corporation, sought leave to appeal from a partial arbitration award and a final arbitration award concerning costs and interest.

The respondent, Soletanche Bachy Canada Inc., opposed the application.

The court dismissed the application, finding that the arbitration agreement, which incorporated CCDC 40 rules and stipulated that disputes would be "finally resolved" and awards "final and binding," precluded any right to appeal.

The court further held that even if a right to appeal existed, the proposed questions of law regarding the reversal of onus, weather-related damages, and COVID-19 impacts were either not pure questions of law or lacked sufficient evidentiary basis for appellate review.

The court-appointed Liquidator of two companies sought advice and direction regarding the application of issue estoppel to claims by a shareholder, Christos Kommatas, and the payment of funds to another shareholder, George Vastis.

The core dispute involved whether Kommatas was precluded from seeking an order for the Liquidator to conduct a claims process as part of the liquidation, an issue previously raised and denied at trial.

The court found that Kommatas was indeed precluded by issue estoppel, as this specific issue was distinctly put before and decided against Kommatas in the prior trial.

The court also authorized the payment of $250,000 to Vastis as previously ordered.

The Insurers brought a motion for a declaration that the "Prior Acts Exclusion" in their Directors and Officers (D&O) insurance policies barred coverage for a claim asserted against Just Energy's D&Os.

The claim, filed by a representative plaintiff in a class action, sought unpaid wages and benefits from a period prior to Just Energy's Companies’ Creditors Arrangement Act (CCAA) filing.

The court found the Prior Acts Exclusion to be clear and unambiguous.

It determined that the exclusion applied to acts or omissions committed by anyone prior to the CCAA filing date, and that this interpretation was consistent with the commercial context of the policies, which were intended to cover post-filing D&O liability during insolvency.

The court concluded that applying the exclusion did not nullify the policy's main purpose or contradict the reasonable expectations of the parties.

The Insurers' motion was granted, and the representative plaintiff's request for relief against the Insurers was denied.

CS Capital Limited, a secured creditor and mortgagee, brought a motion seeking a declaration that its mortgage had priority over construction lien claims on a property.

The court dismissed the motion, finding that the mortgage was not registered prior to the time the first lien arose in respect of the overall improvement project.

Furthermore, the court determined that the mortgage was a collateral mortgage securing a guarantee of a separate debt, and therefore no "advance" was made in respect of it for the purposes of priority under the Construction Act.

This motion, brought by the Van Essen Companies and Wouter Van Essen, sought to strike evidence, grant judgment, and stay proceedings in a receivership, alleging unauthorized access to their privileged records by the court-appointed Receiver (FTI Consulting Inc.) and the appointing creditor (MBL Administrative Agent II LLC).

The court dismissed the motion, finding that the Van Essen Companies failed to establish that the records were intended to be confidential, as Wouter Van Essen knowingly used a Techlantic email account (a third-party entity he considered arm's length) for business and personal communications, including those with legal counsel, and shared emails with Techlantic's senior officer.

The court concluded that the prerequisite for privilege (confidentiality) was not met, and even if it were, privilege was waived by the knowing use of a third-party server and delayed notification to the Receiver.

This is a costs endorsement following a decision to dismiss an application for delay.

The respondents, Robert Saltsman and the "Director Respondents" (Krishnasamy Parthiban, Andrew Lindzon, and Issa Nakhleh), sought costs on a partial indemnity scale for both the dismissal motion and the underlying application.

The applicants argued the costs were excessive.

The court found Mr. Saltsman's claimed costs of $38,696.62 reasonable and fixed them as claimed.

For the Director Respondents, the court allowed their motion costs of $27,177.12 but substantially reduced their application costs from $56,493.15 to $46,846.39 due to insufficient detail justifying the hours claimed for "preparation for the application." The total costs awarded to the Director Respondents were $74,023.51.

The applicants were ordered to pay costs jointly and severally.

This is a costs endorsement following the dismissal of the plaintiffs' contempt motion against two defendants, Saad Aljabri and Mohammed Aljabri.

The plaintiffs had sought a contempt order for alleged breaches of a Mareva Order, with potential sanctions including striking defences and default judgments for billions of dollars.

The defendants, as successful parties, sought substantial indemnity costs.

The court declined to award substantial indemnity costs, finding the plaintiffs' conduct was not reprehensible, scandalous, or outrageous, nor did they pursue the motion for an improper tactical advantage.

The court awarded partial indemnity costs to the defendants for the contempt motion.

Additionally, the court fixed costs for several preliminary motions, with mixed success for the parties, rejecting a "distributive costs" approach for the contempt motion itself but fixing costs for each preliminary motion separately.

The Monitor of BioSteel Sports Nutrition Inc. (under CCAA protection) sought an order declaring ColdHaus Direct Inc. liable for $3.97 million and directing payment, along with an extension of the stay of proceedings and approval of fees.

ColdHaus brought a cross-motion to lift the stay to allow set-off of post-filing obligations against pre-filing amounts, specifically a $1.05 million buy-back claim.

The court allowed the Monitor's payment motion in part, permitting ColdHaus to set off pre-filing billbacks for warehousing ($89,273.14) and distribution rebates ($74,546.05).

However, the court dismissed ColdHaus's motion to set off the buy-back amount, finding the obligation did not arise pre-filing and that ColdHaus had artificially created indebtedness by failing to pay invoices.

The Monitor's request for a stay extension and fee approval was granted.

The plaintiffs moved to compel the defendants, Saad Aljabri and Mohammed Aljabri, to produce law firm trust ledgers and to answer certain questions from examinations.

The court held that trust ledgers are presumptively protected by solicitor-client privilege and that the plaintiffs failed to rebut this presumption.

The court further concluded that the "crime/fraud" exception to solicitor-client privilege does not apply to civil wrongs, including civil fraud, following the principle of horizontal stare decisis.

Consequently, the motion to compel production of trust ledgers was dismissed.

The motion to compel Mohammed Aljabri to answer undertakings and other questions was allowed, subject to redactions for privileged information in bank statements.