COURT FILE NO.: CV-08-358687
DATE: 20140619
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
MICHAEL PRZYSUSKI
Plaintiff
– and –
CITY OPTICAL HOLDINGS INC., YORKVILLE OPTICAL LABS LTD., CITY OPTICAL INC., EMPIRE OPTICAL LABS LTD., STEELES EYEWEAR INC., VALLEYVIEW EYEWEAR INC., BOOTS VISION INC., GOLDEN MILE VISION INC., OPTICAL AUTHORITY INC., ROBERT PARR and BETTY HOLLOWAY PARR
Defendants
Charles Wagman, for the Plaintiff
Christopher Reain, for the Defendant/Moving Party Betty Holloway-Parr
Alex Flesias, for the Defendants Robert Parr, City Optical Holdings Inc., Yorkville Optical Labs Ltd., City Optical Inc., Empire Optical Labs Ltd., Steeles Eyewear Inc., Boots Vision Inc., Golden Mile Vision Inc., Optical Authority Inc.
HEARD: June 16, 2014
PERELL, J.
REASONS FOR DECISION
[1] In July 2008, Michael Przysuski commenced an Application against his brother Robert Parr, his sister-in-law, Betty Holloway-Parr, City Optical Holdings Inc., Yorkville Optical Labs Ltd., City Optical Inc., Empire Optical Labs Ltd., Steeles Eyewear Inc., Boots Vision Inc., Golden Mile Vision Inc., and Optical Authority Inc.
[2] The essential claim in the Application was that Mr. Parr had exercised his powers as a director of the various corporations in a manner that was oppressive. Mr. Przysuski sought an oppression remedy under the Ontario Business Corporations Act.[^1]
[3] Five years later, by Order dated August 20, 2013, Justice Firestone converted the Application into an action. See Przysuski v. City Optical Holdings Inc., 2013 ONSC 5709. Justice Firestone ordered Mr. Przysuski to deliver his Statement of Claim for the action. The Statement of Claim was delivered on October 9, 2013.
[4] All of the Defendants - with the exception of Ms. Holloway-Parr - delivered Statements of Defence.
[5] Ms. Holloway-Parr took the position that Mr. Przysuski’s Statement of Claim was an abuse of process because without leave of the court, he added prayers for relief and allegations against Ms. Holloway-Parr that were not included in the originating process, the Notice of Application, served in 2008.
[6] Pursuant to rules 21.01 (3)(d) and 25.11 of the Rules of Civil Procedure, Ms. Holloway-Parr moved for an Order striking the impugned paragraphs of the Statement of Claim, or alternatively, for an Order striking the Statement of Claim with a direction that the claims and prayers for relief set out in the pleading mirror those contained in the Notice of Application.
[7] On June 16, 2014, I dismissed Ms. Holloway-Parr’s motion and I made the following endorsement:
The Defendant Betty Holloway-Parr brings a motion to strike the Plaintiff’s Statement of Claim as an abuse of process. For written reasons to follow, I dismiss the motion. As I shall explain in more detail, in my opinion, the Plaintiff acted in accordance with the rights provided by the Order of Justice Firestone and did not require leave to deliver his Statement of Claim as it was delivered. I see no unfairness procedural or otherwise to the Defendant Holloway-Parr, who is entitled to plead her defences, including any limitation period defences, as she may be advised. In my opinion, there was no abuse of process by the Plaintiff and, accordingly, I dismiss the moving party’s motion on the following terms. The Defendant Betty Holloway-Parr shall have until Monday, June 23, 2014 to deliver her Statement of Defence, failing which the Plaintiff shall be at liberty to note her in default.
[8] I awarded the Plaintiff costs of $12,448.40, all inclusive, on a partial indemnity scale for the motion.
[9] To explain my decision, I begin by setting out the claim for relief in the 2008 Notice of Application, which stated:
- The Applicant makes application for:
(a) a declaration that Robert Parr (“Parr”) exercised his powers as director of the corporate respondents in a manner that is oppressive unfairly prejudicial and unfairly disregards the interests of the applicant;
(b) an Order appointing a receiver or receiver manager of the corporate respondents;
(c) an Order appointing a director or directors in place of Parr;
(d) an Order allowing the Applicant access to the respondent corporations’ books and records … or in the alternative the appointment of an auditor for the purpose of determining the amounts of funds and property of the corporations misappropriated by Parr from the respondent corporations;
(f) an Order against Parr requiring him to compensate the Applicant and the respondent corporations for monies and property misappropriated by him from the respondent corporations and the Applicant;
(h) damages in the amount of $5,000,000 for conversion;
(i) punitive damages in the amount of $500,000.00;
(l) such other Order as to this Honourable Court seems just.
[10] I reject Ms. Holloway-Parr’s submission that new allegations or prayers for relief were made against her in the Statement of Claim. To the contrary, by the fall of 2008, she knew why she had been joined as a party respondent and the Statement of Claim delivered in the fall of 2013 simply confirmed what she already knew.
[11] The Notice of Application should be read with its supporting affidavits and with the evidentiary record for the Application.
[12] In the case at bar, Ms. Holloway-Parr served and filed an 8-paragraph affidavit on September 4, 2008, in which she denied any involvement in the affairs of the corporations and in which she stated in paragraph 6: “Nowhere in the Notice of Application or in the Affidavit of the Applicant is any allegation made against me personally. No claim is made against me in the Application.”
[13] However, less than two weeks later, on September 22, 2008, Mr. Przysuski delivered a supplementary affidavit in which he stated in paragraph 29:
- … I believe that a review of the various companies will show that Robert has taken money from our companies and sued for his wife’s sole benefit such as home repairs, golf club expenses, pet bills, cell phone, car expenses and other items. She was accordingly added as a party respondent.
[14] Although it is very likely that Ms. Holloway-Parr was feigning ignorance about what she understood from the Notice of Application, Mr. Przysuski’s affidavit was sufficient to inform her why she was joined as a party to an oppression remedy proceeding.
[15] It, therefore, would have been no surprise and rather Ms. Holloway-Parr would have anticipated that the Claim for Relief in paragraph 1 (i) of the 2013 Statement of Claim would seek: “an Order against Betty Holloway-Parr (“Holloway”) requiring her compensate the Plaintiff and the City Optical Corporations for all monies received by her from Parr and the City Optical Corporations.”
[16] It, therefore, would have been no surprise and rather Ms. Holloway-Parr would have anticipated that the Claim for Relief in paragraph 1 (k) of the 2013 Statement of Claim would seek: “an Order tracing the funds that Parr misappropriated from the City Optical Corporations.”
[17] In any event, I do not see how it can be said that what occurred in the case at bar was an abuse of process. In converting the Application into an action, Justice Firestone authorized Mr. Przysuski to deliver a Statement of Claim. Justice Firestone did not impose any limitations on what could be pleaded or require that Mr. Przysuski’s Statement of Claim be a mirror image with a point-for-point correspondence to the Notice of Application.
[18] To act in accordance with a court order can hardly be an abuse of process.
[19] Ms. Holloway-Parr submits that it was abusive for Mr. Przysuski to add new causes of action or new allegations without seeking to leave to amend, which is what is normally required after pleadings have been closed.
[20] Apart from the fact that I have found that no new cause of action was asserted and that no new allegations were added, Ms. Holloway-Parr’s submission is without merit in the circumstances of this case. There are no pleadings in a proceeding by application, and so it is illogical to refer to a closing of pleadings which has yet to occur.
[21] Further, the rule about amendments to pleadings, Rule 26, which Ms. Holloway-Parr submits was circumvented, provides in subrule 26.01 that on motion at any stage of an action the court shall grant leave to amend a pleading on such terms as are just, unless prejudice would result that could not be compensated for by costs or an adjournment.
[22] Thus, the presumptive rule is that amendments are granted, and in the circumstances of this case, where Ms. Holloway-Parr was already a joined party with awareness of the nature of the claims being made against her, it is inconceivable that leave would not have been granted for the delivery of Mr. Przysuski’s Statement of Claim. In other words, Ms. Holloway-Parr has no cause for complaint and there was no abuse of the court’s process.
[23] Ms. Holloway-Parr states that there is no provision in the Rules of Civil Procedure to allow the unilateral amendment of an originating process once pleadings are closed and she submits that Mr. Przysuski needed the leave of the court to deliver a Statement of Claim that varied the Notice of Application, because without leave there would have been a unilateral amendment to an originating process.
[24] I am prepared to agree that had Mr. Przysuski needed to join a new party to the proceeding or had he needed to assert a new cause of action different from his oppression claim, he would have needed leave of the court to do so. But that is not what occurred in the case at bar. Ms. Holloway-Parr was already a party to the oppression claim, she knew the nature of the claim against her, and Justice Firestone ordered the proceeding converted into an action with the delivery of pleadings without qualification or restrictions.
[25] Ms. Holloway-Parr relied on Maynes v. Allen-Vanguard Technologies Inc.,[^2] where the plaintiff commenced a second action against the same and some new defendants making the same and some new allegations and advancing the same and some new claims for relief that were not included in the original action. In Maynes the second action was struck as an abuse of process.
[26] The circumstances of the case at bar are not remotely like those in the Maynes case.
[27] For these reasons, I dismissed Ms. Holloway-Parr’s motion.
Perell, J.
Released: June 19, 2014
COURT FILE NO.: CV-08-358687
DATE: 20140619
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
MICHAEL PRZYSUSKI
Plaintiff
– and –
CITY OPTICAL HOLDINGS INC., YORKVILLE OPTICAL LABS LTD., CITY OPTICAL INC., EMPIRE OPTICAL LABS LTD., STEELES EYEWEAR INC., VALLEYVIEW EYEWEAR INC., BOOTS VISION INC., GOLDEN MILE VISION INC., OPTICAL AUTHORITY INC., ROBERT PARR and BETTY HOLLOWAY PARR
Defendants
REASONS FOR DECISION
PERELL J.
Released: June 19, 2014
[^1]: R.S.O. 1990, c. B.16.
[^2]: 2011 ONCA 125, [2011] O.J. No. 644 (C.A.).