R. Bevan Brooksbank

A payment processing company appealed sanctions imposed after it was found in civil contempt for repeatedly obstructing a court-ordered audit obtained by mandatory injunction under a commercial services agreement.

The appellant argued the penalties were disproportionate, challenged the direction to pay audit costs into court, and sought leave to appeal the contempt-motion costs order.

The Court of Appeal dismissed the appeal, holding the arguments depended on unappealed factual findings that the appellant intentionally obstructed the audit and that no basis existed to interfere with the sanctions or the costs order.

The court allowed the cross-appeal, holding that r. 60.11(6) of the Rules of Civil Procedure is not confined to cases where the officer or director has already been found personally in contempt, and remitted the issue of joint and several liability of the sole officer and director for redetermination.

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.

Following the dismissal of the plaintiffs' action at trial, the defendant sought costs on a full indemnity scale pursuant to a contractual provision in the parties' agreement.

The plaintiffs argued that the provision did not apply to declaratory relief and did not explicitly state 'full indemnity'.

The court held that the contractual language allowing recovery of 'all reasonable costs' entitled the defendant to full indemnity costs.

However, the court declined to award costs for the defendant's U.S. counsel, finding their involvement was not reasonably required for the Ontario litigation.

The court awarded the defendant its Canadian counsel's fees and disbursements in full, totaling $2,192,609.12, finding the amount reasonable and proportionate given the high stakes of the commercial dispute.

The plaintiffs brought a motion for penalty after the defendants were found in civil contempt for breaching a Mareva Order by placing a mortgage on a property and collecting rent.

The plaintiffs sought a 120-day term of imprisonment and the striking of the defendants' pleadings.

The court declined to order imprisonment, finding it disproportionate to the discrete acts of contempt.

Instead, the court ordered the defendants to pay a $35,000 fine and outstanding costs of $15,474.32 within 60 days, failing which their statement of defence and counterclaim would be struck.

Centurion Mortgage Capital Corporation brought a motion for determination of a mortgage priority dispute with The Guarantee Company of North America (GCNA) regarding a condominium development project.

The court found that counsel for both parties had agreed in May 2016 that Centurion's mortgage would have priority over GCNA's mortgage, except with respect to purchasers' deposits.

The court also held that GCNA was precluded by proprietary estoppel from relying on a registered postponement acknowledgment to assert priority over Centurion's mortgage.

The court declared Centurion's mortgage subordinate only with respect to deposits and ordered the deletion of the postponement acknowledgment from title.

The plaintiff landlord brought a motion for summary judgment for rental arrears against the tenant, Nightingale HealtheNet Canada Corporation (NHCC), and its parent company, Nightingale Informatix Corporation (NIC).

The plaintiff argued that NIC was liable based on equitable assignment or part performance, as NIC had paid rent for NHCC for a period after NHCC became financially unviable.

The court granted summary judgment against NHCC but dismissed the claim against NIC, finding no written agreement, guarantee, or sufficient acts of part performance to bind the parent company to the lease obligations.

The court also declined to pierce the corporate veil.