Robert Stuart Whitmore

Maryann Kutlesa initiated an action under the Fraudulent Conveyances Act to set aside the transfer of a 50% interest in a cottage lot from her ex-husband Jozo Kutlesa's company (1349241 Ontario Inc.) to his uncle, John Kotsiou.

She also sought a constructive trust over the interest.

John Kotsiou counterclaimed against Maryann for post-transfer expenses and cross-claimed against Jozo Kutlesa for indemnification.

The court found that Jozo Kutlesa's intent in making the conveyance was fraudulent, but John Kotsiou was protected under section 3 of the Act due to good faith and lack of notice.

Consequently, Maryann's claims were dismissed.

John's counterclaim against Maryann for past operational costs and mortgage payments was dismissed due to his exclusive possession of the property and Jozo's partial contribution.

John's cross-claim against Jozo for outstanding mortgage indemnification was granted.

The defendant brought a motion under Rule 21.01(1)(b) of the Rules of Civil Procedure to strike a paragraph of the plaintiff’s amended statement of claim alleging intentional infliction of mental suffering arising from a false accusation of theft in the employment context.

The defendant argued the pleading failed to disclose a reasonable cause of action under the elements established by the Court of Appeal for the tort of intentional infliction of mental suffering.

The court held that, at the pleadings stage, the alleged factual matrix—including a false accusation of criminal conduct against a long‑term employee—could potentially satisfy the requirement of flagrant or outrageous conduct calculated to cause harm resulting in a visible and provable illness.

Accepting the pleaded facts as true, the court found it was not plain and obvious the claim would fail.

The motion to strike was therefore dismissed.