COURT FILE NO.: CV-13-127

DATE: 20140606

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Solarblue LLC, Plaintiff

AND:

Kimberly Ann Aus a.k.a. Kimberly A. Aus a.k.a. Kim Aus, Steven M. Gamsby a.k.a. Steven Gamsby a.k.a. Steve Gamsby and 2119889 Ontario Inc., Defendants

BEFORE: McDermot J.

COUNSEL: Mr. Trang Nguyen, for the Plaintiff

Ms. Sarah Clarke, for the Defendants, Kimberly Ann Aus and 2119889 Ontario Inc.

Steven M. Gamsby unrepresented

HEARD: March 21, 2014

ENDORSEMENT

Introduction

Introduction

1This is a motion for summary judgment brought against the Defendants, Kimberly Ann Aus and 2119889 Ontario Inc. (“2119889”) of which Ms. Aus is the sole director and shareholder. The Plaintiff, Solarblue LLC (“Solarblue”) seeks a declaration that Ms. Aus was unjustly enriched by the receipt of some $750,000 paid to her company and co-Defendant 2119889 by the Plaintiff. Solarblue also seeks a remedial constructive trust against three properties owned by Ms. Aus and 2119889 which it says were renovated or improved by most or all of those funds.

2At the opening of this motion, Ms. Clarke on behalf of Ms. Aus and 2119889 requested an adjournment of the motion which had been scheduled for a full day. The reason for the adjournment request was that disclosure and undertakings had only recently been completed, and counsel had not yet had time to review or digest that disclosure. Ultimately, both counsel agreed that they could argue the narrow issue of whether the Ms. Aus’ knowledge of the frauds under which the funds were paid is a relevant factor to be considered as part of the Plaintiff’s claim for unjust enrichment. If Ms. Aus’ knowledge of the fraud is found to be irrelevant to that claim, this would obviate the need to make findings of credibility respecting that crucial issue. Although those findings of credibility are now permitted under Rule 20 of the Rules of Civil Procedure, the necessity for making a finding of knowledge on Ms. Aus’s behalf would obviously change the course of the summary judgment motion, perhaps warranting a mini-trial or trial of that issue, again as permitted under Rule 20.

3Although Mr. Gamsby was present at the argument of the motion, his pleadings were struck on March 3, 2014 as a result of an earlier finding of contempt made by McKinnon J. in this matter. Although he professed to be working on paying the fine levied by McKinnon J., he made no submissions on this portion of the motion.

4For the reasons set out below, I have determined that Ms. Aus’ knowledge of the source of the funds is relevant evidence which should be canvassed as part of her defence to the Plaintiff’s claim for unjust enrichment. I have also determined that a mini-trial is necessary in order to determine whether Ms. Aus’ defence of juristic reason for payment of the funds has merit.

Background Facts

Background Facts

5For the purposes of this decision, I need only address the facts briefly.

6Solarblue is a U.S. company in the business of purchasing and selling solar energy projects. In June 2012, they hired Mr. Gamsby to find solar energy facilities in Ontario to purchase; the intent was to purchase these projects and then sell them at a profit.

7At the time, Mr. Gamsby had been in a common law relationship with Ms. Aus since 2010. When Mr. Gamsby met Ms. Aus in 2009, she was then recovering from an earlier motor vehicle accident, which she says has left her with cognitive and memory impairment, along with chronic pain and fatigue. As well, at that time, she owned (and continues to own), either personally or through her company, 2119889, three properties including her primary residence in Enniskillen, Ontario, a cottage property on Fairy Lake in Smith-Ennismore-Lakefield, Ontario, and another rental cottage property in the same municipality.

8More importantly to Solarblue, when they hired Mr. Gamsby, he had been bankrupt on two occasions, the last assignment being on February 24, 2012. He had apparently committed fraud before and there is evidence that an e-mail was sent to the principal of Solarblue advising of his lack of trustworthiness. He was not a good bet for either Solarblue or Ms. Aus.

9Indeed, almost immediately after joining Solarblue, Mr. Gamsby committed the fraud that has resulted in this litigation. In June, 2012, he advised Solarblue that he had found a potential solar project prospect named Kawartha Power Corp. (“Kawartha Power”). He said he had negotiated an agreement for the purchase of the shares of that company, and that he required an advance or deposit of $750,000 in order to secure the transaction. He directed Solarblue to deposit the funds into the account of 2119889. Previously, on June 2, 2012, 2119889 and Solarblue signed an agreement entitled “Contract Agent Agreement” wherein Solarblue agreed to engage 2119889 as its agent to obtain energy development contracts in Ontario; Mr. Gamsby purported to sign this agreement on behalf of 2119889. Pursuant to this agreement and the representations of Mr. Gamsby, Solarblue deposited $750,000 into the account of 2119889 between June 29 and July 30, 2012.

10Unfortunately, Kawartha Power did not exist and was a fictitious entity. No one from Solarblue conducted a corporate search; had they done so, they would have confirmed that there was no such company. As well, 2119889’s sole shareholder and director was Ms. Aus; had Solarblue conducted a corporate search of that company, they would have realized that Mr. Gamsby was neither an officer nor director of 2119889.

11That being said, the transaction between Solarblue and Kawartha Power did not close; indeed it could not have as Kawartha Power did not exist. On May 24, 2013, Mr. Gamsby advised the principals of Solarblue that he had fabricated the Kawartha Power transaction. On May 27, 2013, he provided a signed statement to the principals of Solarblue confirming that he had effectively committed fraud: he confirmed that he had falsely negotiated the $750,000 down payment for his own financial advantage and that Kawartha Power did not exist.

12Mr. Gamsby also stated that all of the money was used for renovations on Ms. Aus’s properties noted above. Ms. Aus also confirmed as much. On July 5, 2013, she initially signed a sworn statement that stated that, other than a small amount used for living expenses and a trip, she had used the funds for “major renovations on all of the properties”. Later, on July 16, 2013, she said that the “majority” of the funds were used for the renovations. She again confirmed on July 22, 2013 that the “majority” of the funds were used for renovations; however, later she said that the renovations were only funded with one half of the $750,000 with the remaining funds being used for other purposes. By the time of the hearing of this motion, Ms. Aus was now stating that just over $200,000 of the funds could be traced into renovations.

13Ms. Aus says that she was unaware of Mr. Gamsby’s fraud and believed the money to have been advanced as a commission on a multimillion dollar transaction that Mr. Gamsby had negotiated. She says that she only became aware of the fraud when Mr. Gamsby disclosed it to her in late June, 2013. She also says that she was not aware of the fact that he had been bankrupt also until he disclosed it in June, 2013. She claims that she separated from Mr. Gamsby in November or December, 2013 although Mr. Gamsby continued to use her address as an address for service when he filed a Notice of Intention to Act in Person on November 25, 2013.

14Surprisingly, after the May, 2013 disclosure, Solarblue initially told Mr. Gamsby that he could pay back the amount through further commissions. However, soon after this, on June 14, 2013, Solarblue obtained a Mareva injunction and certificates of pending litigation on the properties. The Mareva order was extended by Gunsolus J. on June 24 and July 26, 2013.

15On November 27 and 28, 2013, R. McKinnon J. heard a motion brought by the Defendants to set aside the Mareva injunctions. On December 17, 2013, he issued his decision dismissing the motion. In his decision, he considered the claim of unjust enrichment advanced by the Plaintiff, and noted that, “[t]here is no requirement that a defendant in an unjust enrichment claim have knowledge of the fraud or conspiracy by which he or she was unjustly enriched.”¹ However, he then goes on to state that there was a “strong inference” that Ms. Aus “knew or ought to have known that the $750,000 which was deposited into her corporate bank account was fraudulently obtained because:

a) Gamsby was then a second time bankrupt and would not have been able to use his own bank account without attracting the scrutiny of his bankruptcy trustee; and

b) Aus knew he had never ever before received such a large amount; and

c) her explanation about using the company for tax deferral strategies makes no sense. She would not have incurred any such liability by allowing her partner to deposit his fraudulent commissions into her bank account without receiving some benefit to her; and

d) she did not question Gamsby for signing the fake agency contract on behalf of her company when she knew he had absolutely no legal authority to do so.²

16Although Ms. Clarke on behalf of Ms. Aus says that this finding of R. McKinnon J. was obiter, it appears that he made this determination in order to make a finding that there was at the time of the granting of the order, and continued to be at the time of the return of the motion in front of him, a prima facie case for unjust enrichment warranting the Mareva injunction.

17On November 27, 2013, at the same time the motion regarding the Mareva injunction was heard, R. McKinnon J. also heard a motion to declare the Defendants, Ms. Aus and Mr. Gamsby in contempt of the original Mareva injunction through the pawning of Ms. Aus’ wedding ring which was appraised as being worth over $50,000. He fined each of the Defendants $5,000 failing which their pleadings would be struck. Ms. Aus paid the fine and Mr. Gamsby did not. Mr. Gamsby’s pleadings were struck, as noted above, on March 3, 2014.

18Accordingly, at this point in time, the only Defendants in the game are Ms. Aus and 2119889. They are together the owners of the three properties which were renovated, at least in part, by use of the funds fraudulently misappropriated by Mr. Gamsby from Solarblue. As well, there appear to be few other assets. Ms. Aus has listed numerous debts and admitted that she has fully extended a $800,000 line of credit. Mr. Gamsby has advanced a counterclaim, but as his pleadings have been struck it means little or nothing at present.

Analysis

Analysis

19The only issue argued before me at this part of the motion was whether, as stated by McKinnon J., “there is no requirement that a defendant in an unjust enrichment claim have knowledge of the fraud or conspiracy by which he or she was unjustly enriched” for there to be a finding of unjust enrichment. Mr. Nguyen says that, for the purpose of making a finding of unjust enrichment, there is no need to determine the state of a Defendant’s knowledge of the underlying fraud from which the Defendant was enriched. Ms. Clarke, on the other hand, states that it is necessary to make such a determination of knowledge prior to making a finding of unjust enrichment. She suggests that, notwithstanding the findings of R. McKinnon J., a trial of an issue is necessary in order to examine the state of her client’s knowledge of the fraud, which, in the present case, she says is determinative of the issue of unjust enrichment.

20To understand the position of counsel for the Defendant, it is necessary to examine the requirements for a finding of unjust enrichment against a Defendant. These requirements are as follows:

1. There must be an enrichment of the Defendant;
2. There must be a corresponding deprivation of the Plaintiff; and
3. There must be an absence of a juristic reason for the enrichment.³

21There is no issue that the first and second criteria have been met in the present case. Ms. Aus was obviously enriched by the payment into her account by Solarblue, howsoever the money was spent. And Solarblue was deprived of those funds, which have not been returned.

22It is in the third part of the test in which the issue of the Defendant’s knowledge lies.⁴ That is the absence of juristic reason for the payment of the funds: if the funds were paid pursuant to a juristic reason or right, such as contract, gift or statute, for example, then there is no claim for unjust enrichment. However, in Garland v. Consumers Gas Co., the Supreme Court of Canada determined that this was only one part of the test and to explain this, I can do no better than to summarize the applicable portions of that case:

1. Firstly the court should determine whether there was a juristic reason under which the funds were paid under the established categories such as contract, gift or statute. If there is no juristic reason for payment of the funds, the Plaintiff has made out a prima facie case for a finding of unjust enrichment.
2. If, however, none of these established categories are applicable, the prima facie case remains rebuttable where there is “another reason to deny recovery.” In such a case, the court may review “all of the circumstances of the case” to determine whether there is a further reason to deny recovery.
3. Where the Plaintiff has established a prima facie case by showing that none of the established categories apply, the burden is then on the Defendant to prove that there is a further reason to deny recovery beyond those established categories.
4. In rebutting the prima facie case for a finding of unjust enrichment, the court is to have regard for two factors, being “the reasonable expectations of the parties, and public policy considerations.” Unlike the established categories of juristic reasons for payment of the funds, the categories for the second part of the test are not closed and an examination of these two factors may allow the court to “find that a new category of juristic reason is established.” The court makes it clear that “that this area is an evolving one and that further cases will add additional refinements and developments.”⁵

23In Kerr v. Baranow,⁶ the Supreme Court confirmed this, stating that “at the juristic reason stage of of the analysis, the court may take into account the legitimate expectations of the parties… and moral and policy-based arguments about whether the particular enrichments are unjust”.⁷

24Ms. Clarke acknowledged that there was, in the present case, no “established category” of juristic reason through which the money was advanced to her clients. There was no contract, gift or other reason at law under which the money was paid into 2119889’s account; Ms. Aus says that she was permitting Mr. Gamsby to use the corporate account for tax reasons. Accordingly, counsel acknowledges that, if she is to establish a juristic reason for payment, it is up to her client to prove “another reason to deny recovery” under the third part of the analysis. And, more importantly, this is where she states that the state of her client’s knowledge of the fraud is both relevant and necessary to determination of the result.

25The Plaintiff notes, however, that this is not a claim for recovery under the doctrine of knowing receipt, where actual or constructive knowledge of the fraud would be necessary for a finding of liability. A leading case is Citadel General Insurance Co. v. Lloyds Bank Canada⁸ where the basis of the remedy in a claim for knowing receipt was summarized as follows [at para 51]:

It is recalled that a plaintiff is entitled to a restitutionary remedy not because he or she has been unjustly deprived but, rather, because the defendant has been unjustly enriched, at the plaintiff's expense. To show that the defendant's enrichment is unjustified, one must necessarily focus on the defendant's state of mind not the plaintiff's knowledge, or lack thereof. Indeed, without constructive or actual knowledge of the breach of trust, the recipient may very well have a lawful claim to the trust property.

26It would therefore seem, in the case of a claim for knowing receipt at least, the Defendant’s knowledge of the fraudulent source of the funds received by him or her may, depending upon the circumstances, be crucial to the determination as to whether the Defendant’s enrichment was unjust or not.⁹

27Plaintiff’s counsel cites, as support for his position that knowledge of the fraud is unnecessary for a finding of unjust enrichment, an article by Dr. Paul Perell¹⁰ which reviewed the Citadel Assurance case and stated that the distinction between a claims for knowing receipt and unjust enrichment “is that a claim for unjust enrichment does not depend upon the plaintiff proving that the defendant had either actual knowledge or constructive notice of the circumstances yielding the unjust enrichment.”¹¹

28It is correct, according to Garland, that the Plaintiff does not have to prove that the Defendant had knowledge of Mr. Gamsby’s fraud; in fact, according to that case, the onus is on the Defendant to prove that she did not have knowledge of the fraud, and that this is, at least in part, a factor to be taken into account in determining whether there is some other juristic reason for the payment of the funds to 2119889. And Dr. Perell does not necessarily say that a defendant’s knowledge is, in all cases, irrelevant to that part of the unjust enrichment claim: he also says later in the same paragraph that the issue of actual or constructive knowledge may very well be relevant to the issue of the juristic reason for the payment of the funds; he says that although a plaintiff may commence an unjust enrichment claim, that may result in a denial of liability because of lack of actual knowledge with a resulting counterargument that that the defendant was unjustly enriched “because it had constructive knowledge of the plaintiff’s entitlement”¹² Importantly, as well, this article as well as the Citadel decision pre-dated the Garland and Baranow cases, which allowed for a second part to the juristic reason analysis; this may go to further blur the boundaries between a pure unjust enrichment claim as opposed to a claim for recovery for “knowing receipt.”

29Both counsel have cited cases where knowledge of the fraud was found, or was not found to be necessary to a finding of unjust enrichment. For example, in Den Haag Capital LLC v. Correia¹³ the plaintiff was the receiver of the fraudster seeking to recover funds from the defendant to distribute to other victims of a Ponzi scheme. The defendants in that case had actually benefitted from the scheme to the tune of nearly two million dollars; they had no knowledge of the Ponzi scheme or the fraud by which they benefitted those funds and thought that their profits from their investment were legitimate. They defended on the basis of change of position. Even after having found that the “defendants believed that they were entitled to these funds” and that “their circumstances are most unfortunate,” Pepell J. determined that the “law of unjust enrichment requires the return of Ponzi profits.”¹⁴ The fact that the defendants were unaware of the fraud did not prevent a finding of unjust enrichment.

30However, in Cusimano v. D.A.D. Construction Inc.,¹⁵ a case similar to the present case, the plaintiffs had advanced funds to the common law spouse of the defendant, Brenda McGarrell. There was an acknowledgment of a deprivation and corresponding benefit by the defendant in that case, Ms. McGarrell. That defendant sought summary judgment dismissing the claim against her, partly on the basis that the “plaintiffs have neither pleaded nor produced any evidence that… Ms. McGarrell had any knowledge of the contract or the source of funds.”¹⁶

31T.P. Herman J. stated that “I have not been referred to any cases where the court found unjust enrichment and granted the remedy of constructive trust in which there was not a finding that the defendant had knowledge – either actual or constructive – of the wrongful source of funds.”¹⁷ She went on to determine “that in order for the plaintiffs to succeed in their case against the co-defendants, they must establish that Ms. McGarrell had actual or constructive knowledge of the source of the funds.”¹⁸

32Mr. Nguyen suggests that this case was wrongly decided. And it would appear that the statement that the plaintiffs must prove the lack of knowledge is incorrect, insofar as the Supreme Court of Canada stated in Garland that under the third part of the test for unjust enrichment outside of the established categories, the onus is on the Defendant to demonstrate lack of juristic reason for receipt of the funds. Moreover, if the case purports to be authority for the proposition that in all cases, knowledge is a necessary factor for a finding of unjust enrichment, it may very well be that this case is not good law; knowledge of the fraud was not a pre-requisite in Den Haag for example. However, as noted by T.P. Herman J., her finding that the defendant should have had knowledge of the fraud may, in fact, be “case-specific.”¹⁹ And, notwithstanding the misplaced onus, it may very well be that in Cusimano, lack of knowledge by the defendant of the fraud may have provided a juristic reason for the payment of the funds to her, thereby affording a defence to the claim for unjust enrichment.

33Mr. Nguyen similarly says that Den Haag is authority for the proposition that the knowledge of a defendant in receipt of funds as to the source of the funds is irrelevant to the finding of unjust enrichment. Again, this case may very well be case-specific, as it appears to be an attempt to balance the equities where one innocent party benefitted at the expense of others because of Ponzi scheme. It may be authority that knowledge is not an issue in the case of unjust enrichment claims where there is a Ponzi scheme or other similar situations. And I note that Pepell J. did not decide that the defendants’ knowledge of the circumstances of the fraud were irrelevant to the finding of unjust enrichment; she determined after a mini-trial that both parties were equally innocent of notice, and then determined that the “less” innocent party, the party who benefitted from the scheme, should be responsible for repayment to the plaintiff in that case. However, it is clear that she heard evidence as to the defendant’s knowledge of the fraud. And it is also to be noted both that she conducted a mini-trial and made a finding of lack as to knowledge; I suspect that she would have been surprised at any suggestion that evidence of the defendants’ knowledge of the fraud was irrelevant to her determination of liability.

34The basis for unjust enrichment is clear. As suggested by its label, unjust enrichment requires a finding of an enrichment that is “unjust” and without that basic component, there can be no finding under the doctrine. This is the crux of the reason for the third element in the remedy regarding the existence of a juristic reason for the receipt of funds; unlike the first two requirements, this is the place where the court considers the equities between the parties. We must bear in mind the original third element of the test for unjust enrichment imported from English law was that the enrichment of the Defendant be unjust: see James More & Sons Ltd. v. University of Ottawa at para. 36;²⁰ the third part of the test, lack of juristic reason for the enrichment, was only more recently adopted by the Supreme Court of Canada in Pettkus v. Becker.²¹

35Accordingly, if the ultimate issue under the third part of the test is whether the enrichment was unjust, I believe that, as part of the determination of the issue, the Defendant’s knowledge of the fraud may be relevant to that determination. And accordingly, as part of that defence, the Defendant should be permitted to lead evidence of her state of knowledge as a component of her defence to the claim for unjust enrichment and to give voice to her position that a finding of unjust enrichment is not warranted under the circumstances. It is entirely conceivable that this Defendant’s state of knowledge would be relevant in light of the defences raised by her, including change of position, lack of due diligence on the part of the Plaintiff and her actual lack of knowledge of the fraud.

36Mr. Nguyen suggests that to take this Defendant’s knowledge into account would be the “tail wagging the dog.” In stating this, I assume he is saying that he objects any suggestion that the Defendant’s lack of knowledge as being central to this matter. To be clear, I am not saying that the lack of knowledge is central to this matter; nor nor am I saying that Solarblue has an obligation to prove the Defendant’s knowledge of the fraud as suggested in Cusimano. I am determining, in answer to the question raised on the motion, that there is no rule of law, as far as I can determine, that lack of knowledge of the fraud is never relevant to a finding of unjust enrichment. And I am also making a finding that this Defendant’s lack of knowledge (or her actual or constructive knowledge) of the fraud is relevant evidence which she is entitled to lead as part of her defence of there being a juristic reason for the money having been paid to her. This is especially so where this defendant alleges that she suffers from cognitive difficulties resulting from the 2008 motor vehicle accident. Nothing changes the fact that the onus is on her to make out that defence, but she is entitled to make full answer by leading evidence to prove that there was, in fact, a juristic reason for payment of the funds in order to fully defend the claim for unjust enrichment and the corresponding claim for constructive trust against the real estate owned by her and 2119889.

37The question posed was whether a finding of the Defendant’s knowledge of the fraud was necessary to a finding of unjust enrichment. My answer to the question is that the Defendant’s knowledge as to the source of the funds is relevant to a determination of unjust enrichment surrounding the third part of the test for unjust enrichment. And I also believe that it would be wrong to decide this case without being in a position to make a finding as to the knowledge of the Defendant as to Mr. Gamsby’s fraud committed on the Plaintiff.

Next Steps

Next Steps

38I am cognizant of the fact that R. MacKinnon J. made several statements in his endorsement on the motion to set aside the Mareva injunction. He stated, in the context of that motion, that there was no requirement that the Defendant knew of the fraud prior to obtaining a finding of unjust enrichment. Strictly speaking, that is correct; there is no absolute requirement of knowledge, and the Plaintiff does not have to prove knowledge by the Defendant of the fraud; however, as determined, I believe that to be a relevant factor when a defence is raised on the issue of other juristic reason for the payment of the funds.

39He also said, however, that he was willing to make a finding that the Defendant did know of the fraud, and listed a number of reasons why he was willing to make that finding. Mr. Nguyen urged me, if knowledge was an issue, to make a similar finding on this Defendant’s knowledge of the fraud for the purpose of this summary judgment motion.

40Although I disagree with Ms. Clarke’s contention that this finding was made in obiter, R. MacKinnon’s finding was made for a limited purpose in order to determine whether there was a prima facie case for a Mareva injunction, and for no other purpose. Mr. Nguyen is, on the other hand, asking me to make a similar finding in order to also make a finding of unjust enrichment, which effectively decides the case. I believe this to be inappropriate and that viva voce evidence is necessary to determine whether the Defendant can prove that there is no juristic reason for receipt of the funds from her. All other components of the test are admitted by Defendant’s counsel and as such the onus is on the Defendant to make out this defence. But I am not prepared to make that finding on the basis of affidavit evidence alone. Again, this is especially so where Ms. Aus states that she has cognitive issues arising from the 2009 motor vehicle accident noted in her materials, which may explain the numerous inconsistencies noted by R. MacKinnon J. in his decision. Although Rule 20.04 allows me to weigh evidence and make credibility findings, and notwithstanding Ms. Aus’ previous inconsistencies as noted above, much rests on those findings in this case and the Defendant should be entitled to lead that evidence in the context of a mini-trial on that issue.

41In all of this, however, and based upon the admissions made by counsel at the hearing of the motion and in the materials, I am willing to make the following findings and determinations relevant to the mini-trial of this issue:

a. The first two parts of the test for unjust enrichment have been made out, and there is a finding that there was a deprivation of the Plaintiff to the benefit of the Defendants, Ms. Aus and 2119889; b. There is no juristic reason under the established categories for the payment of the funds to Ms. Aus and 2119889; and c. The Plaintiff has therefore established a prima facie case for a finding of unjust enrichment and the onus is on the Defendants, Ms. Aus and 2119889, to prove on the balance of probabilities that there is was a juristic reason for the payment of the funds to them under the second part of the third element of the unjust enrichment analysis.

42Accordingly, I am going to schedule through the trial coordinator in Barrie a teleconference with counsel to determine when that mini-trial should take place, and whether counsel wish me to remain seized of this matter, considering the fact that I sit in Barrie and my availability to sit in Peterborough on a timely basis.²²

43As this is part of an ongoing motion for summary judgment, the costs of this motion are in the cause of the summary judgment motion.

McDERMOT J.

Footnotes

1. 1Solarblue LLC v. Aus, 2013 ONSC 7638, [2013] O.J. No. 5800 (S.C.J.) at para 6
2. 2Ibid. at para 13
3. 3see Kerr v. Baranow¸ 2011 SCC 10, [2011] 1 S.C.R. 269 at para 36 and Garland v. Consumers’ Gas Co., 2004 SCC 25, [2004] 1 S.C.R. 629 at para 30
4. 4As Ms. Aus is the only director and shareholder of 2119889, I take her knowledge of any of the fraud, if any, to be the knowledge of that company as well.
5. 5Consumers’ Gas Co. v. Garland, supra at paras 44 - 46
6. 62011 SCC 10, [2011] 1 S.C.R. 269
7. 7Ibid. at para 44
8. 81997 CanLII 334 (SCC), [1997] 3 S.C.R. 805.
9. 9See also Healthy Body Services Inc. v. 121679 Ontario Ltd., 2013 ONSC 6396 at paras. 89 – 99 and Condominium Corp. No. 0321365 v. 970365 Alberta Ltd., 2012 ABCA 26 at para. 96 where the distinction is confirmed between an action for knowing receipt as opposed to unjust enrichment.
10. 10Paul M. Perell, Intermeddlers or Strangers to the Breach of Trust or Fiduciary Duty, (1998) 21 Advoc. Q. 94
11. 11Ibid. at pp. 113-114
12. 12Ibid. at p. 114
13. 132010 ONSC 5339
14. 14Ibid. at paras. 68 - 70
15. 15[2011] O.J. No. 4693 (S.C.J.)
16. 16Ibid. at para. 19
17. 17Ibid. at para. 35
18. 18Ibid. at para. 36
19. 19Ibid at para. 42.
20. 20[1974] O.J. No. 2038 (H.C.)
21. 211980 CanLII 22 (SCC), [1980] 2 S.C.R. 834
22. 22See paragraph 77 and 78 of Hryniak v. Mauldin, 2014 SCC 7, [2014] S.C.J. No. 7 which states that a summary judgment justice should remain seized “in the absence of compelling reasons to the contrary.”