ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: CV-14-10633-00CL
DATE: 20150609
BETWEEN:
PACKALL PACKAGING INC., PACKALL CONSULTANTS (1981) LIMITED, 967915 ONTARIO LIMITED and HENRY CISZEWSKI personally and in his capacity as Trustee of the Ciszewski Family Trust
Plaintiffs
– and –
ANITA CISZEWSKI, personally and in her capacity as Trustee of the Ciszewski Family Trust and 2300078 ONTARIO LIMITED
Defendants
A N D B E T W E E N:
ANITA CISZEWSKI, personally and in her capacity as Trustee of the Ciszewski Family Trust and 2300078 ONTARIO LIMITED
Plaintiffs by Counterclaim
– and –
PACKALL PACKAGING INC., PACKALL CONSULTANTS (1981) LIMITED, 967915 ONTARIO LIMITED, HENRY CISZEWSKI, personally and in his capacity as Trustee of the Ciszewski Family Trust, 835474 ONTARIO LIMITED, JAMES F. BILLETT, in his personal capacity and in his capacity as Trustee of the Ciszewski Family Trust, STEPHAN CISZEWSKI and FRANK DEL DUCA
Defendants to the Counterclaim
Geoffrey Adair, Q.C. and Jennifer King, for the Plaintiffs
Peter Carey, for the Defendants
HEARD: December 4, 2014
L. A. Pattillo J.:
[1] This is a motion by the plaintiffs, Packall Packaging Inc. (“Packall Packaging”), Packall Consultants (1981) Limited (“Packall Consultants”), 967915 Ontario Limited (“967915”) (collectively the “Packall Group of Companies”) and Henry Ciszewski (“Henry”) personally and in his capacity as Trustee of the Ciszewski Family Trust (the “Trust”) for either an interim or permanent injunction:
a) Restraining the defendants, Anita Ciszewski (“Anita”), personally and in her capacity as Trustee of the Trust and 2300078 Ontario Limited (“Anita Co.”) from selling or offering the sale of the shares of 967915 and or the shares of Anita Co. without the consent in writing of Henry or his successor in law, either permanently or until the trial of this action; and
b) Restraining the defendants from directly or indirectly disclosing the financial statements or any information contained therein of the Packall Group of Companies to any person or corporation without the consent in writing of Henry or his successor in law, either permanently or until the time of trial of the action.
[2] The defendants have brought a cross-motion seeking summary judgment dismissing the plaintiffs’ claim and partial summary judgment in their counterclaim for an order:
a) Compelling the directors of the Packall Group of Companies to call and hold an annual general meeting as required under the Ontario Business Corporations Act, R.S.O. 1990, c. B. 16 (the “OBCA”);
b) Compelling the directors of the Packall Group of Companies to appoint auditors to the Companies, as required by the OBCA;
c) Compelling the Packall Group of Companies to immediately deliver their current financial statements and, subsequently, deliver their audited financial statements to 2300078 within thirty (30) days of each of the companies’ year ends;
d) Compelling the trustees of the Trust to deliver a complete accounting of the Trust, since inception in 1999, to the beneficiaries of the Trust;
e) Compelling the trustees of the Trust to provide a complete accounting of the Trust to the beneficiaries of the Trust;
f) Compelling Henry to provide a complete accounting of all monies received by him, directly or indirectly, legally or beneficially from any of the Packall Group of Companies since June 1, 2005;
g) Declaring Anita is free to sell her shares of Anita Co. without restriction; and
h) Declaring that Anita Co. may provide financial statements of the Packall Group of Companies to potential purchasers.
Background
[3] Henry and Anita were married on November 30, 1968. They have four children, Kimberly Anne, Stephan, Mark and Christopher, all of whom are now adults. Henry and Anita separated on October 31, 2007 and were divorced on June 14, 2010. On September 22, 2011, Henry and Anita entered into a written separation agreement (the “Separation Agreement”) which was negotiated through lawyers for each of them.
[4] The Trust was established in 1999. The trustees are Henry, Anita and Jim Billet, Henry’s accountant. Anita and the four children are the beneficiaries.
[5] Packall Packaging is a manufacturer of flexible food packaging located in Brampton, Ontario. It specializes in meat, cheese and seafood packaging. It was started by Henry in 1987 and is an extremely successful company. It currently employs approximately 170 people and generates about $70 million in sales annually. Henry is the President and a director of Packall Packaging. Anita has never been involved in the day to day operation of Packall Packaging.
[6] Packall Packaging is described by Henry as a mid-size player in a highly competitive packaging market with a number of large, publicly traded competitors.
[7] At the time of the Separation Agreement, Packall Packaging was owned by Henry, Anita and the Trust through a multi corporate structure involving Packall Consultants, 96791584 and 835474 Ontario Limited. The Trust also owned 14 common shares (out of 98) of Packall Packaging directly. Henry, through ownership of a majority of the shares of 967915 and 100% of the voting non-participating shares of Packall Consultants, has voting control of Packall Packaging. The full ownership structure of the companies prior to the Separation Agreement is set out in the chart attached as Appendix “A” to these reasons.
[8] Henry is the President and a director of Packall Consultants and a director of 967915. Anita is the other director of 967915.
[9] Anita owns her shares in 967915 through her holding company, Anita Co. She is the sole shareholder of Anita Co.
[10] The Articles of Incorporation of 967915 specifically provide that the shares of the corporation may not be transferred without the express sanction of the board of directors or by instrument in writing signed by a 75% majority in voting rights of the holders of the issued common shares of 967915. In other words, without the agreement of Henry and Anita.
The Separation Agreement
[11] The Separation Agreement provides, among other things, for financial provision for Anita (Article 4). Generally, Article 4 provides that Anita is to receive financial support from Henry, mainly through the payment of dividends by Packall Packaging through the other Packall Group of Companies and the Trust to Anita. Specifically in that regard, Anita was to receive within seven business days of execution a dividend of $500,000 from Packall Packaging through the related companies (Article 4.1); within 15 business days, a cash payment from Henry of $400,000 (Article 4.2); and in each fiscal year subsequent to the fiscal year ended September 30, 2011, a dividend of $575,000 but only during the joint lives of Henry and Anita (Article 4.3); the dividend is payable on or before September 30th in each year commencing in 2012 (Article 4.8).
[12] Articles 4.5, 4.6 and 4.7 of the Separation Agreement provide that in the event that the directors of Packall Packaging determine that the annual $575,000 dividend payable to Anita will be reduced or eliminated in any year, Packall Packaging must give notice to her and Henry is required to pay support to Anita in an amount up to $575,000 in order to ensure the obligation in addition to any tax Anita is required to pay as a result of such payment over and above the tax she would have had to pay if she received the monies as a dividend.
[13] Article 4.12 provides that in the event Henry predeceases Anita, financial provision shall be made for her by Packall Packaging in lieu of any such provision being made by Henry’s estate, which shall have no liability to Anita for support.
[14] Further to Article 4.12 of the Separation Agreement, Anita and Packall Packaging entered into a separate agreement, a copy of which was appended to the Separation Agreement as Schedule C (the “Schedule ‘C’ Agreement”). Paragraph 1 of the Schedule “C” Agreement provides that if Henry predeceases Anita, Packall Packaging will purchase a percentage of Anita`s shares in the company for cancellation in each year based on a purchase amount set out. In paragraph 2, Anita represents and warrants, among other things, that on each closing, she will be the legal and beneficial owner of the common share free and clear of all liens, charges and encumbrances whatsoever.
[15] Article 4.14 of the Separation Agreement provides that either Henry or Anita may reorganize the way in which they hold the shares by transferring all or part of them to a holding company controlled by each of them respectively, provided (a) completion of the transaction does not cause adverse tax consequences to the opposite party and (b) the holding company and not the individual will be the recipient of the dividend payments and will be deemed to be party to the Schedule “C” Agreement.
[16] There is no dispute that Article 4.14 was added to the Separation Agreement at the last minute at the request of Anita’s lawyers for “tax” reasons.
[17] Article 5.1 of the Separation Agreement provides:
Anita acknowledges and agrees that for so long as she receives the dividend and/or support payments specified above in section 4, she will be completely financially independent of Henry, and accordingly releases Henry from any and all claims to spousal support save and except for claims arising in the event of a default in payment of the dividend and/or support payments specified in paragraph section 4 of this agreement.
[18] Article 7.1 provides that the Separation Agreement is a full and final settlement of all issues between Anita and Henry and all rights and obligations arising out of their relationship.
[19] Article 9.1 provides that there are no representations, collateral agreements, warranties or conditions affecting the agreement.
[20] On September 26, 2011, Anita transferred her shares in 967915 to Anita Co. Henry continues to own his shares in 967915 personally.
After the Separation Agreement
[21] Following the execution of the Separation Agreement, Packall Packaging and the other Packall Group of Companies paid dividends to Anita Co. in accordance with the provisions of the Separation Agreement.
[22] In July 2012, and notwithstanding that the Separation Agreement released Henry from all claims for spousal support in the absence of default, Anita sought to open discussions with Henry on the pretext of creating a succession plan for them both to cover the potential capital gains tax liability arising from the sale or deemed disposition of their shares in 967915. In fact, what Anita wanted was for Henry to establish a fund to pay the tax liability that will arise in respect of her shares in 967915 when she dies so that she can leave her shares to her children. Anita evidence is that while she had no intention of selling her shares, she was advised by her lawyers that if she died, her estate would have a tax liability of between four and five million dollars. She further said that she wanted to leave her shares to her children and that they could not afford such liability. While negotiations subsequently took place between Henry and Anita through their advisors, no agreement was reached.
[23] In the absence of an agreement, Anita threatened to sell her shares in 967915. Henry, through his advisors, took the position that she could not sell her shares in 967915 without Henry’s consent. Anita’s lawyer responded taking the position that there was no restriction on Anita selling the shares of Anita Co.
[24] In May, 2014, Henry learned that Anita had begun pursuing her threats by seeking interest for the sale of the shares of Anita Co. (and hence 967915) to third party competitors. During her cross-examination in these proceedings, Anita agreed that in April 2014, through her lawyer, she sent letters to five prospective purchasers who were suppliers, customers or competitors of Packall Packaging. Three companies expressed interest and were sent a copy of the corporate chart and non-disclosure agreements. No further information has been sent by Anita or her advisors.
The Action and Counterclaim
[25] As a result of Anita’s actions, Henry issued a statement of claim on July 7, 2014. The plaintiffs’ claim against Anita and Anita Co. as pleaded in their statement of claim is based both on breach of contract and breach of Anita’s good faith obligations as director of 967015 pursuant to s. 134 of the Ontario Business Corporations Act, R.S.O. 1990, c. B.16 (the “OBCA”).
[26] The defendants filed a defence and counterclaim dated September 12, 2014. Anita’s position is that there are no restrictions on her ability to sell her shares in Anita Co. Further, she denies that she has sent any confidential information belonging to any of the Packall Group of Companies to any other third party. The Counterclaim seeks a number of orders relating to the corporate governance of the Packall Group of Companies and the Trust as well as declarations that Anita is free to sell her shares in Anita Co. to whomever she chooses and provide financial statements to potential purchasers. She also seeks orders that the Packall Group of Companies have acted in an oppressive fashion by not paying dividends when they were capable of doing so and compelling them to do so.
The Position of the Parties
[27] The plaintiffs submit that they are entitled to an interim or, in the alternative permanent order restraining Anita from selling or attempting to sell her shares in 967915 either directly or through Anita Co. In addition, they seek an interim or permanent order restraining Anita from disclosing any financial information regarding the Packall Group without the consent of 967915.
[28] In support of their position, the plaintiffs submit that the reasonable interpretation of Section 4.14 of the Separation Agreement, when considered in the context of the Separation Agreement as a whole is that Anita has no further right to dispose of her interest in the shares of 967915 beyond transferring them to Anita Co. absent the consent of Henry. In the alternative, the plaintiffs submit that there is an implied term in the Separation Agreement to the effect that neither Henry nor Anita would have any further right of disposition of shares of 967915 beyond placing those shares in a holding company controlled by themselves.
[29] Further, the plaintiffs submit that Anita’s conduct in marketing the shares of Anita Co. to competitors, customers and suppliers of Packall Packaging constitutes an act of oppression under s. 248 of the OBA.
[30] The defendants seek summary judgment dismissing the plaintiffs’ claim in its entirety and partial summary judgment on their counterclaim to compel shareholder meetings and audited statements required by the OBCA from the Packall Group of Companies along with other incidental relief and for an accounting by Henry of the monies he has taken from the Packall Group of Companies.
[31] The defendants submit that the provisions of the Separation Agreement cannot be interpreted to restrict Anita from selling her shares in Anita Co. nor should the court imply a term in that regard. Further, the defendants submit that because Anita is a director of 967915 and a beneficiary of the Trust and Anita Co. is a shareholder of 967915, they are entitled to the financial statements from the Packall Group of Companies and to the other forms of corporate governance relief they seek.
The Issues
[32] The issues to be decided are therefore as follows:
- Do the terms of the Separation Agreement prohibit Anita from disposing of her shares in 967915 by selling the shares of Anita Co.;
- Are the plaintiffs entitled to restrict Anita’s access to financial information of the Packall Group of Companies;
- Is Anita Entitled to Orders Enforcing Certain Corporate Governance Issues in the Packall Group of Companies?
Discussion
1. Does the Separation Agreement Prohibit Anita from Disposing of the Shares in Anita Co. in the Absence of Henry’s Consent.
[33] The plaintiffs submit that having regard to the terms of the Separation Agreement as a whole, including the Schedule “C” Agreement, Article 4.14, which allows either Henry or Anita to transfer their shares in 967915 to “a corporation controlled by each of them respectively (their ‘holding company,’ in each case)” should be interpreted to mean that Anita would have no further right to dispose of her interest in the shares of 967915 beyond transferring them to a holding company (Anita Co.), absent Henry’s consent.
[34] I agree with Anita, however, that the wording of Article 4.14 clearly does not restrict the ability of either Henry or Anita to dispose of the shares of their respective holding companies. Contract interpretation involves the determination of the meaning or specific words or phrases in the contract where they are capable of more than one interpretation. That is not the case here. Article 4.14 provides clearly for the transfer by either Henry or Anita of their shares in 967915 or other companies in the Packall Group of Companies to a holding company. It does not restrict any subsequent transfer or sale of shares in the holding company nor can it be interpreted in that regard.
[35] That, however, does not end the discussion. The plaintiffs further submit that the Separation Agreement contains an implied term that restricts either Henry or Anita from selling their shares in their holding companies without the consent of the other.
[36] A term may be implied in a contract in three ways: 1. based on custom and usage; 2. as the legal incidents of a particular class or kind of contract; or 3. based on the presumed intention of the parties where the implied term must be necessary to give business efficacy to a contract or as otherwise meeting the “officious bystander” test as a term which the parties would say, if questioned, that they had obviously assumed. See: Canadian Pacific Hotels Ltd. v. Bank of Montreal, 1987 55 (SCC), [1987] 1 S.C.R. 711 (SCC); M.J.B. Enterprises Ltd. v. Defence Construction (1951) Ltd., 1999 677 (SCC), [1999] 1 S.C.R. 619 (SCC) at para. 27; Rankin Construction Inc. v. Ontario, 2014 ONCA 636 (Ont. C.A.) at para. 29.
[37] Having regard to the circumstances of this case and in particular the wording of the Separation Agreement, in my view and I so find that there is an implied term in the Separation Agreement based on the presumed intentions of the parties preventing either Henry or Anita from disposing of their shares in their respective holding companies without the consent of the other.
[38] Anita argues that such an implied term is contrary to the intentions of the parties at the time of the Separation Agreement. She points to Henry’s position taken before the Family Court, which in my view has no relevance to the issue of his intention at the time of the Separation Agreement which was entered into after the divorce. Anita’s evidence is she had no thoughts on the issue. Further, she says that she was unaware of the restrictions on the transfer of her shares in 967915. I do not consider Anita’s evidence to be evidence of actual intention. In my view, the best evidence of the actual intention of the parties is discerned from the provisions of the Separation Agreement.
[39] The Separation Agreement by its terms settles all issues between Henry and Anita arising from their marriage and divorce (Article 1.5). In particular, it provides for Anita’s annual financial support through the payment of dividends from the Packall Group of Companies, primarily through 967915. As a result, it is clear in my view that in agreeing to such a provision, Anita’s intention at the time she entered into the Separation Agreement was that she would not sell her shares in 967915 whether she owned those shares directly or through a holding company without Henry’s consent as a director and shareholder of 967915 given that Henry would be personally liable to her in the event she did not receive the dividends.
[40] Similarly, in order to ensure that Henry and the Packall Group of Companies met their obligations under the Separation Agreement, Henry would have to retain control of the Packall Group of Companies. Accordingly, it is clear that Henry too intended that he would not sell his shares in 967915 except to a holding company as agreed without Anita’s consent.
[41] The shares of 967915 cannot be transferred without the consent of the board of directors or agreement of 75% of the common shareholders. I do not accept that Anita was unaware of the transfer restriction at the time of the Separation Agreement. In my view, both Henry and Anita, as shareholders, knew or are deemed to know of such provision. The restriction is common in private companies such as 967915. Further, I consider that Anita’s lawyers were clearly aware of it when they asked for Article 4.14 to be added to the Separation Agreement. There would have been no need for such a provision had the shares been freely transferable.
[42] I am also satisfied that a term that neither Henry or Anita can dispose of their shares of any holding company having their shares in 967915 in the absence of the consent of the other is necessary to give business efficacy to the Separation Agreement and the Schedule “C” Agreement.
[43] In the absence of such an implied term, Anita would be free to sell her shares in Anita Co., which would result in her no longer being able to receive dividends from 967915, which are the primary means of her ongoing support. Such action clearly defeats the main purpose of the Separation Agreement which is to provide for the ongoing annual financial support for Anita. Further, if Anita Co.’s shares in 967915 were sold, Anita would cease receiving the dividends. Anita could then argue that Henry was liable for such payments pursuant to the Separation Agreement. That is not what the Separation Agreement intended.
[44] As noted, the Schedule “C” Agreement provides for financial provision for Anita in the event that Henry predeceases her through the mechanism of Packall Packaging repurchasing Anita’s shares. The purpose of the Schedule “C” Agreement, as noted in Article 4.12 of the Separation Agreement, is to both provide financial provision for Anita and remove any obligation in that regard from Henry’s estate. By selling her shares in Anita Co., who is deemed by Article 4.14(b) of the Separation Agreement to be a party to the Schedule “C” Agreement, Anita defeats the purpose of the Schedule “C” Agreement as she will no longer be entitled to any financial provision from Packall Packaging.
[45] I am also satisfied that the “officious bystander” test is satisfied in respect of the implied term being sought. I am satisfied, given the circumstances and the provisions of the Separation Agreement, that if asked at the time the Separation Agreement was entered into, both Anita and Henry would have said at that any disposal of their shares in 967915, either directly or through a holding company, can only be done with the consent of the other party.
[46] Finally, I do not find that the exclusion clause in the Separation Agreement (Article 9.1) excludes an implied term. Although it specifically deals with representations, collateral agreement, warranties of conditions, it does not deal with implied terms.
[47] Although the plaintiffs initially only sought an interim and/or interlocutory injunction against Anita, given the defendants summary judgment motion to dismiss their claim and based on the material before me, I am satisfied that there is no genuine issue for trial in respect of the issue of whether Anita is entitled to sell her shares in Anita Co. without Henry’s consent. As I have held, pursuant to the terms of the Separation Agreement, she is not. Accordingly, the plaintiffs are entitled to a permanent order restraining Anita from selling or marketing her shares in Anita Co. in the absence of Henry’s consent.
[48] It follows therefore that the defendants’ summary judgment motion seeking a dismissal of the plaintiffs’ claim is dismissed. Similarly, the defendants’ partial summary judgment motion in their counterclaim seeking an order declaring Anita is free to sell her shares of Anita Co. without restriction is also dismissed.
2. Are the plaintiffs entitled to restrict Anita’s access to financial information of the Packall Group of Companies.
[49] The plaintiffs also request an order refusing Anita’s access to the Packall Group of Companies’ financial statements unless she enters into a confidentiality agreement. In response, the defendants seek partial summary judgment of their counterclaim declaring that Anita may provide financial statements of the Packall Group of Companies to potential purchasers.
[50] The evidence establishes that while Anita caused letters seeking expressions of interest in the sale of her shares to be sent to Packall Packaging’s suppliers, customers and competitors, no financial information has been disclosed. Nor am I convinced that she would have gone that far. In my view, her motive for such action was not to sell the shares but rather to upset Henry and bring him back to the bargaining table in order that she could get what she wanted concerning succession planning. While it upset Henry, it failed in bringing him back to the bargaining table.
[51] As a director of 967915 and the sole shareholder of Anita Co. which in turn is a shareholder of 967915, Anita is entitled to obtain the financial statements of the Packall Group of Companies. In fact, up until she solicited third party interest in 967915’s shares, she was receiving them.
[52] The plaintiffs rely on s. 248 of the OBCA and the oppression remedy to justify restricting Anita’s access to the financial statements. Having not claimed oppression in their statement of claim, I am not prepared to grant them such relief on that basis. Apart from that, I do not consider Anita’s conduct in sending the five letters and then the non-disclosure agreements to amount to oppressive conduct on her part.
[53] As noted, Anita is a director of 967915 as well as a shareholder of 967915 through Anita Co. She is entitled to receive the financial statements both as a director and a shareholder. At the same time, a director has a responsibility to act honestly, in a diligent manner, in good faith and in the best interests of the corporation. Clearly, providing the Packall Group of Companies’ financial statements to any of Packall Packaging’s competitors, suppliers or customers, in the absence of the consent of the board, would be a serious breach of such duty by Anita as a director. But that has not occurred to date and I am not satisfied it will. Accordingly, the plaintiffs’ request for the order is denied.
[54] Apart from her duty as a director, I have held that the Separation Agreement prevents Anita from marketing or selling Anita Co.’s shares in 967915 without the Henry’s consent. As a result, she has no basis to provide the Packall Group of Companies’ financial statements to potential purchasers. Her request for partial summary judgment in that regard is accordingly dismissed.
3. Is Anita Entitled to Orders Enforcing Certain Corporate Governance Issues in the Packall Group of Companies.
[55] As noted at the outset, Anita also seeks partial summary judgment to enforce proper corporate governance of the Packall Group of Companies. In particular she seeks an order:
a) Compelling the directors of each of the Packall Group of Companies to call and hold an Annual General Meeting;
b) Compelling the directors of the companies to appoint auditors;
c) Compelling the Packall Group of Companies to immediately deliver their current financial statements and thereafter audited financial statements within 30 days of year end;
d) Compelling the trustees of the Trust to deliver a complete accounting of the trust to the beneficiaries from its inception in 1999 and thereafter an annual accounting; and
e) Compelling Henry to provide a complete accounting of all monies received by him, directly or indirectly, legally or beneficially from any of the Packall Group since June 1, 2005.
[56] There is no question that each of the Packall Group of Companies is required to hold an annual general meeting (OBCA, s. 94). Henry is not adverse to doing so. Accordingly, the Packall Group of Companies shall hold annual meetings of shareholders in accordance with the provisions of the OBCA.
[57] The evidence establishes that the financial statements Packall Packaging, the operating company, are audited annually by Price Waterhouse Coopers LLP. The remaining statements of Packall Consultants, 967915 and 834474 Ontario Limited are not audited. Their principal asset in each case is the shares in Packall Packaging or the shares of Packall Consultants which are carried at cost. Packall Consultants also owns the land and building which is leased to Packall Packaging.
[58] The evidence of Mr. Billet, a chartered accountant who has done work for the Packall Group of Companies since their inception is that audited financial statements for the Packall Group of Companies other than Packall Packaging would not provide an additional useful information to the unaudited statements and would cost more money to prepare. Anita has provided no basis for her request for audited financial statements for all of the Packall Group of Companies. I consider the request to be a nuisance request rather than required. In the circumstances, therefore, it makes no sense in my view to require the financial statements of Packall Consultants, 967915 and 835474 Ontario Limited to be audited.
[59] The financial statements of the Packall Group of Companies should be provided to Anita within 30 days following their completion.
[60] As both a trustee and a beneficiary of the Trust, Anita is entitled to an accounting of all activities of the Trust. That accounting should be from the Trust’s commencement. Henry has raised no argument in opposition. Accordingly, the Trust should provide such account within 90 days of these reasons. Annual accountings should follow.
[61] Finally, Anita wants disclosure of all monies taken by Henry from the Packall Group of Companies since 2010. Her request is based on monies taken by Henry from the Packall Group of Companies in 2008 to 2010. There is no evidence or suggestion that Henry has taken monies from the Packall Group of Companies to which he was not entitled.
[62] Anita is a director of 967915. In that capacity, she is entitled to information from that company as to the monies Henry has taken from 967915. Otherwise she is at best a shareholder or shareholder of a shareholder and, in the absence of some evidence of wrongdoing or suspicion of wrongdoing on Henry’s part, is not entitled as a shareholder to the information requested. In that regard, she has had the financial statements up to 2012 and has raised no concern in respect of remuneration as indicated on those statements.
[63] Accordingly, apart from disclosure by 967915 of monies Henry has received from it after 2010 (excluding dividends received as a result of the Separation Agreement); Anita’s request for disclosure of the monies Henry has received from the Packall Group of Companies is denied.
Conclusion
[64] For the reason herein:
The plaintiffs’ motion is allowed and judgment is granted against Anita and Anita Co. restraining them from selling or offering for sale the shares of Anita Co. in the absence of Henry’s consent.
The plaintiffs’ action is otherwise dismissed.
The defendants’ summary judgment motion seeking dismissal of the plaintiffs’ claim is dismissed.
The defendants’ partial summary judgment motion on the counterclaim is allowed in respect of an order requiring annual meetings of the Packall Group of Companies, delivery of annual financial statements within 30 days of completion, an accounting of the activities of the Trust from its inception and annually thereafter and disclosure of monies taken by Henry from 967915 since 2010 (apart from the dividends paid pursuant to the Separation Agreement).
The defendants’ partial summary judgment motion on the counterclaim is otherwise dismissed.
[65] The defendants’ partial summary judgment motion disposed with most but not all of their claims in the counterclaim. I remain seized with the remaining claims, the scheduling of which should be determined at a 9:30 a.m. appointment to be arranged through the Commercial List office.
[66] Both sides have achieved some but not complete success on their respective motions. In my view, each side should bear its own legal costs. No order for costs.
L. A. Pattillo J.
Released: June 9, 2015
Appendix “A”
COURT FILE NO.: CV-14-10633-00CL
DATE: 20150609
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
PACKALL PACKAGING INC., PACKALL CONSULTANTS (1981) LIMITED, 967915 ONTARIO LIMITED and HENRY CISZEWSKI personally and in his capacity as Trustee of the Ciszewski Family Trust
Plaintiffs
– and –
ANITA CISZEWSKI, personally and in her capacity as Trustee of the Ciszewski Family Trust and 2300078 ONTARIO LIMITED
Defendants
A N D B E T W E E N:
ANITA CISZEWSKI, personally and in her capacity as Trustee of the Ciszewski Family Trust and 2300078 ONTARIO LIMITED
Plaintiffs by Counterclaim
– and –
PACKALL PACKAGING INC., PACKALL CONSULTANTS (1981) LIMITED, 967915 ONTARIO LIMITED, HENRY CISZEWSKI, personally and in his capacity as Trustee of the Ciszewski Family Trust, 835474 ONTARIO LIMITED, JAMES F. BILLETT, in his personal capacity and in his capacity as Trustee of the Ciszewski Family Trust, STEPHAN CISZEWSKI and FRANK DEL DUCA
Defendants to the Counterclaim
REASONS FOR JUDGMENT
PATTILLO J.
Released: June 9, 2015