Superior Court of Justice - Ontario

Citation: AE Hospitality Ltd. v. George, 2015 ONSC 3802 Court File No.: 166/15 Date: 2015-06-12

Re: AE HOSPITALITY LTD., APPLAUSE CATERING INC. and ENCORE FOOD WITH ELEGANCE, Plaintiffs/Responding Parties And: IRENE GEORGE, ANNE BOLOTIN, EUGENE GEORGE, Defendants/ Moving Parties

Before: H. Sachs J.

Counsel: David S. Altshuller and Lara Di Genova, for the Defendants/ Moving Parties Keith Landy and Shawn Tock, for the Plaintiffs/Responding Parties

Endorsement

[1] This is a motion for leave to appeal the decision of Whitaker J., dated March 18, 2015, denying their request to vary a Mareva order to permit them access to the proceeds from the sale of their home in order to pay their outstanding and future legal fees incurred to defend this action.

[2] In denying the relief requested, the motion judge applied the test set out by Molloy J., in Canadian Imperial Bank of Commerce v. Credit Valley Institute of Business and Technology, 2003 12916 (“Credit Valley”), which was adopted by the Court of Appeal in Waxman v. Waxman, 2004 39040.

[3] According to the Moving Parties, the motion judge erred in his application of the Credit Valley test. In particular, they allege that:

(a) he erred in finding that Irene George had stolen funds from Encore Group when this is a heavily-disputed allegation that will be the subject of a trial;

(b) he misinterpreted the evidentiary burden on the Moving Parties to vary a Mareva injunction;

(c) he failed to support his conclusions that the Moving Parties did not provide sufficient evidence; and,

(d) he erred when he characterized the Moving Parties as “acknowledged liars”.

[4] In order to succeed on a motion for leave to appeal, it is not sufficient to argue that there is a good reason to doubt the correctness of the order in question. The moving party must also establish that “the proposed appeal involves matters of such importance that…leave to appeal should be granted”. In the alternative, the issues raised by the proposed appeal must be ones where there are conflicting decisions and it is “desirable that leave to appeal be granted” (Rules of Civil Procedure, Rule 62.02(4)).

[5] “Importance” in the context of a motion for leave to appeal means that the matter “transcend[s] the immediate interest of the parties and involves matters of public importance and matters relevant to the development of the law and the administration of justice. Where the issues are fact-driven, they do not raise issues of general public interest”. (SLMsoft.Com.Inc. v. Rampart Securities Inc., 2005 41549 (ON SCDC), [2005] O.J. No. 4847, at para. 74).

[6] While it may be of great importance to the Moving Parties that the Mareva injunction be varied, there is no issue that transcends their own interests at stake in this appeal.

[7] The Moving Parties argue that the motion judge’s decision conflicts with other cases on the same issue, particularly Bot Construction (Ontario) Ltd. v. Dumoulin et al., 2008 22123 (ON SC), [2008] 90 O.R. (3d) 680; and, Innovative Marketing Inc. v. D’Souza et al, [2008] 39221. According to the Moving Parties, in Bot and Innovative, the court granted a defendant’s motion to vary a Mareva order in spite of the fact that the affidavits filed in support in those motions did not contain any evidence as to other assets.

[8] This argument ignores the fact that, in Bot and Innovative, the Mareva injunctions froze all of the defendant’s assets worldwide and, therefore, the judges in those cases accepted that the defendants met the first part of the test set out in Credit Valley.

[9] The Moving Parties also take issue with the motion judge’s conclusion that the defendants are “acknowledged liars” and argue that this conclusion runs contrary to the principle established in Chiang (Trustee of) v. Chiang, [2011] O.J. No. 416 that the court should not make credibility findings at the pre-trial interlocutory stage when credibility is a central issue in the trial and the trial has not yet taken place.

[10] In the case at bar, the motion judge did not go so far as to find that the Moving Parties were “unsavoury, unbelievable” witnesses (the credibility finding that the motion judge in Chiang rejected as being inappropriate). Rather, he found that the Moving Parties had, in effect, acknowledged lying about their financial affairs to other people. This finding was available to him on the record before him.

[11] In the end, the motion judge made reasonable factual findings based on the motion record before him and then applied the relevant principles to those factual findings to reach the conclusion he did. Simply because one court reaches a different decision than another court based on a different set of facts does not mean that the decisions are in “conflict”. As the court stated, in Comtrade Petroleum Inc. v. 490300 Ontario Ltd., 1992 7405 (ON SC), [1992] O.J. No. 652:

An exercise of discretion which has led to a different result because of different circumstances does not meet the requirement for a ‘conflicting decision.’ It is necessary to demonstrate a difference in the principles chosen as a guide to the exercise of such discretion.

[12] For these reasons, the motion for leave to appeal is dismissed. The Plaintiffs filed a costs outline that was only served on the defendants on June 10, 2015. The defendants will have 10 days from the release of these reasons to forward me their submissions with respect to the Plaintiffs’ request for costs. On June 10, 2015, I also received a Reply Factum from the defendants. I agree with the Plaintiffs that the matters addressed in this factum should have been addressed in the original factum.

H. SACHS J.

Date: 2015-06-12