COURT FILE AND PARTIES

COURT FILE NO.: CV-14-10518-00CL

DATE: 2015-12-23

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: IN THE MATTER OF THE COMPANIES’ CREDITORS ARRANGEMENT ACT, R.S.C. 1985, c. C-36 AS AMENDED

AND IN THE MATTER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF 1511419 ONTARIO INC., FORMERLY KNOWN AS THE CASH STORE FINANCIAL SERVICES, 1545688 ALBERTA INC., FORMERLY KNOWN AS THE CASH STORE INC., 986301 ALBERTA INC., FORMERLY KNOWN AS TCS CASH STORE INC., 1152919 ALBERTA INC., FORMERLY KNOWN AS INSTALOANS INC., 7252331 CANADA INC., 5515433 MANITOBA INC., 1693926 ALBERTA LTD. doing business as “THE TITLE STORE”

BEFORE: Regional Senior Justice G. B. Morawetz

COUNSEL:
Jonathan Foreman and Lindsay Merrifield, for the Ontario Consumers Class Action

James Harnum, Agent to Harrison Pensa

David Mann and Robert Kennedy, for DirectCash in CCAA Proceedings

Eric R. Hoaken, for DirectCash in Class Action Proceedings

Peter Griffin and Matthew Lerner, for Gordon Reykdal

Jeff Galway, for N. Bland

Mark Polley and Eric Brousseau, for National Money Mart Company

Andrew Faith and Jeff Haylock, for 1573568 Alberta Ltd.

Geoff R. Hall and Stephen Fulton, for the Monitor (FTI Consulting Canada Inc.)

Patrick Riesterer, for the Chief Restructuring Officer of the Applicants

Michael Byers, for Craig Warnock

Serge Khallughlian and Charles Wright, for the Ad Hoc Committee of Purchasers of Applicants’ Securities, including the Plaintiff in the Ontario Securities Class Action

Mary Margaret Fox, for ACE Insurance Company

Doug McInnis, for Axis Reinsurance Company

Brendan O’Neill and Carolyn Descours, for the Ad Hoc Committee of Noteholders

Rebecca Wise, for Albert Mondor, Michael Shaw, Ron Chicoyne, William Dunn and Robert Gibson

Ilan Ishai, for the McCann Entities

David Hoffner, U.S. Counsel for the Monitor in Chapter 14 Proceedings

HEARD and ENDORSED: November 19, 2015

REASONS: December 23, 2015

ENDORSEMENT

onTARIO CONSUMER CLASS ACTIONS: FEES, DISBURSEMENTS AND APPLICABLE TAXES

[1] At the conclusion of oral submission, the motion was granted with reasons to follow. These are the reasons.

[2] A motion was brought for an order approving the contingency fee and disbursement request of Ontario Consumer Class Action Counsel.

[3] Approval is sought for a contingent legal fee of approximately 25% of the recoveries achieved in the Ontario Consumer Class Action Settlements plus disbursements and applicable taxes.

[4] The fee request is valued at $2,417,625 plus applicable taxes, while the disbursement request is in the amount of $707,387.66, inclusive of taxes.

[5] The request is made pursuant to retainer agreements entered into between the Representative Plaintiff, Timothy Yeoman and Class Counsel, which provide for a maximum legal fee of 30% of the recoveries achieved, plus disbursements and applicable taxes. The motion was not opposed.

[6] Class Counsel commenced the following actions on behalf of the Ontario Consumer Class Action Members:

i. Timothy Yeoman v. The Cash Store Financial Services Inc. (the “Cash Store Claim”);

ii. Timothy Yeoman v. Gordon J. Reykdal (the “Directors and Officers Claim”); and

iii. Ronald Payne and Timothy Yeoman v. Trimor Annuity Focus Limited Partnership et al. (Court File No.: 4172/14, the “Third Party Lender Claim”) (collectively, the “Proceedings”).

[7] Settlements have been approved which will result in the complete and total settlement of the Cash Store Claim and the Directors and Officers Claim, as well as a partial settlement of the Third Party Lender Claim (the “Ontario Consumer Class Action Settlements”).

[8] The Ontario Consumer Class Action Settlements have resulted in monetary recoveries of $10,062,500 plus a share of certain Estate Action Litigation Proceeds which may be recovered in the future, for the benefit of the Ontario Consumer Class Action Class Members.

[9] The background details to the fee request are set out in the factum filed by counsel on behalf of the Class Members.

[10] The following factors have been cited by various courts in determining the reasonableness of class counsel fees:

i. The factual and legal complexities of the matters dealt with;

ii. The risk undertaken, including the risk that the matter may not be certified;

iii. The degree of responsibility assumed by class counsel;

iv. The monetary value of the matters in issue;

v. The importance of the matter to class;

vi. The degree of skill and competence demonstrated by class counsel;

vii. The results achieved;

viii. The ability of the class to pay;

ix. The expectations of the class as to the amount of fees; and

x. The opportunity cost to class counsel in the expenditure of time in pursuit of the litigation and settlement.

(See: Osmun v. Cadbury Adams Canada Inc., 2010 CarswellOnt. 3350 (SCJ) and Abdulrahim v. Air France, 2011 CarswellOnt. 403 (SCJ)).

[11] In the factum, counsel discusses the application of the factors to be considered and states that they can all be subsumed in three broader factors: results, risks and responsibility. Counsel submits that first, strong results have been achieved with considerable monetary recoveries made under difficult circumstances; second, the three actions and the CCAA Proceedings involved very considerable risks due to a complex and adversarial multi-party scenario with an insolvent key defendant at the core of the case; and thirdly, Class Counsel assumed full responsibility for the demands of the litigation and for the notice and settlement distribution aspects of the case, which remain to be completed.

[12] Having considered the evidence and the supporting argument, again recognizing that the matter proceeded on an unopposed basis, the motion is granted and an order has been signed in the form presented.

Regional Senior Justice Morawetz

Date: December 23, 2015