Peter J. Cavanagh

The plaintiffs in a proposed class action regarding beer pricing and market allocation in Ontario sought leave under s. 29 of the Class Proceedings Act to discontinue the action against the LCBO and treat it as an unnamed co-conspirator.

The court dismissed the motion as premature, finding that the discontinuance should occur, if at all, only after the close of pleadings, as the remaining defendants had not yet filed statements of defence and might assert cross-claims or third-party claims against the LCBO.

The court also found the evidentiary record inadequate to justify discontinuance.

Following a successful motion by the respondent to set aside a Mareva injunction, the court determined the appropriate scale and quantum of costs.

The respondent sought substantial indemnity costs of $138,144.10, while the applicant argued for partial indemnity costs of $55,000.

The court found no conduct justifying substantial indemnity costs and awarded partial indemnity costs fixed at $75,000 for fees plus disbursements, considering the complexity and the large amount at stake.

The applicant brought a motion to strike an affidavit filed by a respondent in an application to recognize and enforce a foreign arbitral award under the International Commercial Arbitration Act.

The affidavit alleged that the applicant had engaged in money laundering and other criminal activity relating to the investment that was the subject of the arbitration.

The court held that the affidavit attempted to relitigate issues already determined by the arbitral tribunal and would improperly create a “trial within a trial” on the merits of the award.

Because recognition and enforcement proceedings under the UNCITRAL Model Law permit only narrow defences, the affidavit was clearly irrelevant and scandalous.

The affidavit was struck, though it could remain in the record solely as part of the Paris annulment proceedings.

A state-owned corporation moved to set aside or vary a Mareva injunction freezing shares and dividends of a Canadian mining company in aid of enforcing a foreign arbitral award against a sovereign state.

The moving party argued the injunction should be set aside for lack of full and frank disclosure and because subsequent appellate decisions undermined the factual basis relied upon to establish that the state beneficially owned the frozen shares.

The court held the applicant had exercised reasonable diligence and did not breach the duty of full and frank disclosure.

However, later appellate decisions overturning related rulings significantly weakened the evidentiary basis supporting the injunction.

The court ordered the Mareva injunction set aside at a future date, varied it immediately to reduce the amount of frozen assets, and permitted the award creditor time to bring a new motion on notice.

The defendant brought a motion for summary judgment seeking dismissal of a claim arising from a land purchase agreement involving residential development lands in Oshawa.

The plaintiff alleged that the Agreement of Purchase and Sale and related Omnibus Agreement required a post-closing readjustment of the purchase price where the net developable area of the lands was later reduced.

The court held that the contracts did not provide for post-closing adjustments to the purchase price, and that the closing adjustments based on the consultant’s calculation of net developable area were final.

The plaintiff’s later attempt to rely on a recalculation based on modified development constraints was not conducted using the contractual definition of net developable area and was based on the purchaser’s subsequent development choices.

Interpreting the agreements to allow indefinite post-closing adjustments would create commercial uncertainty and absurdity.

Summary judgment was granted dismissing the claim.

The defendants brought a motion for security for costs against the corporate plaintiff in a complex software copyright and breach of confidence action.

The court found good reason to believe the plaintiff had insufficient assets in Ontario to pay the defendants' costs if unsuccessful.

The plaintiff failed to establish impecuniosity or a good chance of success on the merits.

The court ordered the plaintiff to post $1,110,000 in security for costs, payable in three installments, to balance the defendants' need for protection with the risk of stifling the litigation.