Citation: Khavari v. Mizrahi, 2016 ONSC 7794
COURT FILE NO.: 475/16
DATE: 20161213
SUPERIOR COURT OF JUSTICE – ONTARIO
RE: KHASHAYAR KHAVARI et al., Plaintiffs/Defendants by Counterclaim (Moving Parties)
AND:
SAM MIZRAHI et al., Defendants/Plaintiffs by Counterclaim (Respondents)
BEFORE: M. DAMBROT J.
COUNSEL: Simon Bieber and James Gibson, for the Plaintiffs/Defendants by Counterclaim (Moving Parties)
Lawrence Thacker, Nadia Campion and Chris Kinnear Hunter, for the Defendants/Plaintiffs by Counterclaim (Respondents)
HEARD: In writing
ENDORSEMENT
Introduction
[1] The appellants seeks leave to appeal from the order of Pattillo J. dated August 17, 2016. In that order, the motion judge dismissed their motion for the appointment of an investigator pursuant to sections 161 and 248 of the Ontario Business Corporations Act (“OBCA”).
Test for Leave to Appeal
[2] The test for granting leave to appeal under Rule 62.02(4) is well-settled. It is recognized that leave should not easily be granted and the test to be met is a very strict one. There are two possible branches upon which leave may be granted. Both branches involve a two-part test and, in each case, both aspects of the two-part test must be met before leave may be granted. In this case, the moving parties rely only on the second branch: Rule 62.04(b).
[3] Under Rule 62.02(4)(b), the moving party must establish that there is reason to doubt the correctness of the order in question and that the proposed appeal involves matters of such importance that leave to appeal should be granted. It is not necessary that the judge granting leave be satisfied that the decision in question was actually wrong – that aspect of the test is satisfied if the judge granting leave finds that the correctness of the order is open to “very serious debate”: Nazari v. OTIP/RAEO Insurance Co., 2003 CanLII 40868 (ON SC), [2003] O.J. No. 3442 (S.C.J. per Then J.); Ash v. Lloyd’s Corp. (1992), 1992 CanLII 7652 (ON SC), 8 O.R.(3d) 282 (Gen. Div. per Farley J.). In addition, the moving party must demonstrate matters of importance that go beyond the interests of the immediate parties and involve questions of general or public importance relevant to the development of the law and administration of justice: Rankin v. McLeod, Young, Weir Ltd. (1986), 1986 CanLII 2749 (ON SC), 57 O.R. (2d) 569 (H.C.J. per Catzman J.); Greslik v. Ontario Legal Aid Plan (1988), 1988 CanLII 4842 (ON SCDC), 65 O.R. (2d) 110 (Div. Ct.).
Analysis
[4] The moving party argues that the motion judge erred in dismissing their motion for the appointment of an investigator:
by failing to determine whether the plaintiffs had put forward a prima facie case of oppressive conduct;
by failing to find a prima facie case of oppression in light of $12 million in unexplained net withdrawals
by misapprehending the purpose and role of the proposed inspection
by misapprehending the cost and inconvenience of the proposed investigator’s role; and
by upending the remedial nature and purpose of the inspection remedy
[5] The only one of these issues that merits any serious consideration is the first issue: whether the motion judge failed to determine whether the plaintiffs had put forward a prima facie case of oppressive conduct. The moving parties assert that the motion judge instead effectively required them to prove oppression on the merits in an interim motion. The core argument of the moving parties on this issue flows from the following statement of the motion judge at paragraph 55 of his decision made in the course of determining if the moving parties had put forward a prima facie case of oppression:
In my view, Mizrahi has responded to the Plaintiffs' allegations of oppressive conduct in specific detail. Whether the Plaintiffs' allegations of improper conduct are correct or whether Mizrahi's responses will prevail cannot be determined on this motion. At its heart, the evidence raises credibility issues that cannot be resolved on a motion like this. Further, even if some or all of the Plaintiffs' allegations are correct, the issue remains as to whether Khash's reasonable expectations as a complainant have been unfairly disregarded by Mizrahi having regard to the Agreement. Those issues, in my view, can only be resolved at trial.
[6] This comment must be viewed in the context of the reasons as a whole. The motion judge set out the proper test in detail, and exhibited a clear understanding of its components. He examined the whole of the evidence before him, and reached the conclusion that the moving parties had not established a prima facie case. While the reference in the impugned paragraph to the resolution of certain issues being possible only at a trial was unnecessary to the question at hand, it was accurate. I see no basis to conclude that it undermines his conclusion on the issue. As a result, this argument gives me no reason to doubt the correctness of the order in question. In any event, a misapplication of a well settled test in a single case would not give rise to a question of general or public importance justifying the granting of leave.
[7] With respect to issue 3, this argument amounts to nothing more than an assertion that the motion judge was wrong.
[8] With respect to issue 5, it is a rather extravagant effort to dress this decision up as having implications that it simply does not have in order to satisfy the requirement that it involve questions of general or public importance relevant to the development of the law and administration of justice such that leave should be granted. It does not.
[9] Issues 2 and 4 are factual matters of no moment on this application.
[10] As a result, this motion fails both prongs of the test for leave to appeal in Rule 62.02(4)(b).
Disposition
[11] Leave to appeal is refused. Upon the agreement of the parties, costs are awarded to the responding parties fixed in the amount of $17,500 all inclusive, payable within 30 days of the release of these reasons.
M. DAMBROT J.
Date: December 13, 2016