SUPERIOR COURT OF JUSTICE - ONTARIO

B E T W E E N:

Carlos A. Mesa

Plaintiff

-AND-

TD Direct Investment, TD Waterhouse, TD Discount Brokerage & Associate Investment Branch Companies

Defendants

BEFORE: F.L. Myers J.

READ: September 4, 2015

endorsement

[1] This motion was referred to me by the registrar’s office pursuant to rule 2.1.01(7) following receipt of a written request of counsel for the defendants under subrule 2.1.01(6).

[2] The plaintiff purchased a modest portfolio of publicly traded shares through brokerage facilities offered by one or more of the defendants. He sues the defendants for their failure to pay over to him millions of dollars in investment returns that he says are held for him in special trust accounts. He says that the trust accounts were opened for him by the issuers of the publicly traded securities. The trust agreements were held through “proxy accounts.”

[3] Each year, the plaintiff receives shareholder proxy forms. They are sent by issuers in conjunction with the issuers’ annual general meetings. The proxy forms enable shareholders to exercise the voting rights attached to their shares for matters that arise at the annual general meeting such as electing the board of directors. The plaintiff seems to view the shareholder voting proxy forms and shareholder identification numbers on those forms as evidencing the “proxy accounts” through which his trust accounts are held. Computershare, the transfer agent for each of the issuers, has apparently denied that trust accounts exist. Try as they might, the defendants have also not located the accounts either.

[4] The plaintiff attached many documents to his statement of claim that evidence both the state of his investment accounts in 2011, the standard shareholder voting proxy forms on which he relies, and the defendants’ efforts to satisfy the plaintiff’s inquiries.

[5] The plaintiff also attached charts to the statement of claim showing technical market analysis. He discussed sophisticated investment analysis such as Fibonacci ratios. What seems to be missing from the plaintiff’s claim however, is any pleading or any indication that the alleged trust accounts actually exist or, even if they did, that they have anything to do with the defendants.

[6] Reporting issuers of common shares do not routinely open a secret trust account for each of their publicly traded shares. Ownership or access to a trust account is not an attribute of corporate share ownership. Nor is it part of the plaintiff’s account agreements with the defendants. Shareholder voting documents, including routine voting proxy forms, do not evidence ownership of a secret trust account. Nor do they entitle the plaintiff to claim money from the defendants.

[7] It appears that the plaintiff’s claim is frivolous or vexatious on its face. Therefore, he should be called upon to make brief written submissions as to why the action should not be dismissed at this time under rule 2.1.

[8] On reviewing the material forwarded by the registrar, the court makes the following order:

a. Pursuant to subrule 2.1.01(3)(1), the registrar is directed to give notice to the plaintiff in Form 2.1A that the court is considering making an order under Rule 2.1.01 dismissing the action;

b. Pending the outcome of the written hearing under rule 2.1 or further order of the court, the plaintiff’s action is stayed pursuant to s.106 of the Courts of Justice Act, R.S.O. 1990, c.C.43[^1];

c. The registrar shall accept no further filings in this action excepting only the plaintiff’s written submissions if delivered in accordance with rule 2.1.01(3);

d. In addition to the service by mail required by 2.1.01(4) rule, the registrar is to serve a copy of this endorsement and a Form 2.1A notice on the plaintiff and counsel for the defendants by email if it has their email addresses.

________________________________ F.L. Myers J.

Date: September 4, 2015

[^1]: See Gao v. Ontario WSIB et al., 2014 ONSC 6100 at para.