United Soils Management Ltd. v. Altmann

CITATION: United Soils Management Ltd. v. Altmann, 2017 ONSC 7057

COURT FILE NO.: CV-16-56349

DATE: 2017-11-24

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: United Soils Management Ltd.

AND:

Justin K. Altmann

BEFORE: P. J. Monahan J.

COUNSEL: William A. Chalmers, for the Applicant David Sterns and Sabrina Callaway, for the Respondent

HEARD: October 19, 2017

ENDORSEMENT

[1] Justin K. Altmann (“Altmann”) is the Mayor of the Town of Whitchurch-Stouffville. In 2015 and 2016, golf tournaments were held in order to raise funds for the Mayor’s Community Fund (the “Fund”).

[2] Alec T. Cloke (“Cloke”) is the director and guiding mind of United Soils Management Ltd. (“United Soils”), the applicant in this proceeding. United Soils made contributions to the golf tournaments held in 2015 and 2016, and Cloke assisted in the organization of the 2015 golf tournament.

[3] Following the second tournament in 2016, Cloke became concerned over the status of the monies that had been raised for the Fund. On September 22, 2016, counsel for United Soils wrote to Altmann, requesting a copy of “every monthly bank account statement related to the funds raised from the 2015 Mayor’s Golf Tournament, from inception to present, together with a detailed explanation for every debit and credit therein…”

[4] On October 5, 2016, Altmann responded that “we are unable to provide you with the requested documents at this time.”

[5] On November 3, 2016, United Soils commenced this application (the “Application”) in which it sought, inter alia, a declaration that the funds raised for the Mayor’s Community Fund “are subject to a constructive trust” to the benefit of United Soils, Cloke and various other donors to the Fund. United Soils further sought an order requiring Altmann to provide a full accounting, along with an order for the tracing of monies raised for the Fund.

Progress of the Litigation

[6] The litigation proceeded through various stages through the balance of 2016 and into 2017. Eventually, on May 25, 2017, Altmann provided monthly bank statements for the relevant bank accounts, along with copies of accompanying cheques, deposit slips, invoices, receipts and supporting correspondence. Altmann indicated that he was providing this documentation, which consisted of 505 pages, in an effort to prevent further expenditure of time and resources. Altmann maintained that the Fund was not subject to a constructive trust and United Soils and Cloke were not entitled, as of right, to the information being provided. Altmann also offered to settle the matter on the basis that the Application would be dismissed on a without costs basis, such offer to remain open until June 30, 2017.

[7] On June 30, 2017, counsel for United Soils replied, noting that the provision of the relevant documentation by Altmann had rendered the issues raised in the Application moot, and the only outstanding issue was the question of costs. United Soils proposed that the hearing scheduled for October 19, 2017 be restricted to the issue of costs.

[8] Counsel for Altmann responded on July 6, 2017. Although Altmann had been willing on May 25, 2017 to have the application dismissed on a without costs basis, he now indicated that he did not agree that the issues raised by the Application were moot. He identified four issues that he believed were of “significant public interest” and should be adjudicated regardless of the fact that the information requested by Cloke and United had been voluntarily provided. These issues included:

(i) whether United Soils had standing to bring the Application;

(ii) whether the Application was commenced against the correct party;

(iii) whether Altmann had a legal obligation to provide United Soils with the requested documentation; and

(iv) should a tracing of the donated funds be ordered.

[9] The parties proceeded to prepare materials addressing these issues, which came before me at the hearing on October 19, 2017.

Mootness: Positions of the Parties

[10] United Soils takes the position that the issues raised in the Application are moot and need not be adjudicated. Altmann had provided all of the information and documentation requested in the September 22, 2016 letter and United Soils was content with the information provided. United Soils is no longer seeking the other relief set out in the Application. Moreover, Altmann has indicated that he is willing to provide the same information to any other individual who requests it. Accordingly, there is no longer any live issue or controversy between the parties and, apart from the issue of costs, any decision of this court would have no practical effect.

[11] Altmann takes the position that the Application is not moot because, although he has provided the requested information to Cloke and United Soils, he has not conceded that they are entitled to the information as of right. Moreover, Altmann argues that United Soils had no standing to bring the Application and that Altmann was not a proper respondent.

[12] In the alternative, Altmann argues that, even if the case is moot, the court should exercise its discretion to hear the case. Altmann argues that the applicant spread misinformation about the status of the fund and that these allegations of impropriety have never been withdrawn or corrected. He claims that allegations of impropriety against a public official are very difficult to refute without a court disposition and could have adverse consequences at the ballot box. Altmann also argues that this Application presents issues of public importance, the resolution of which will be in the public interest. The Fund is intended to benefit the community and Altmann is a public official. If the Application remains undecided, this could have a chilling effect on future charitable efforts in the community. Altmann also argues that the applicant has a history of strategic litigation and a decision on the merits is necessary in order to obviate future repetitious litigation.

Analysis

[13] It is settled law that a case will be found to be moot if there is no longer any live controversy between the parties.[^1] The normal rule is that a court will decline to hear a moot case since “courts exist to resolve real disputes between parties and not to provide opinions in response to hypothetical or academic problems.”[^2] A court may exercise its discretion to hear a moot case in exceptional circumstances and in accordance with relevant criteria. These criteria include: whether there remains an adversarial context or relationship between the parties; whether there are special circumstances that warrant the expenditure of scarce judicial resources, such as where a case presents an issue of public importance; and whether the case engages the court’s proper law-making function, as opposed to intruding onto the role of the legislative branch.

[14] It is clear that the issues raised in the Application are now moot. First, there is no longer a live issue between the parties. Altmann has voluntarily provided United Soils with all of the information that was sought in the September 22, 2106 request. The provision of this information has satisfied the applicant, who is no longer pursuing the other relief sought in the Application. Regardless of whether or not the applicant had a right to demand the information, had standing to bring the Application, or to name Altmann as respondent, Altmann has elected to provide the information requested. There is no longer any dispute over the provision of financial information relating to the golf tournaments or the Fund, and the matter is now moot.

[15] I see no merit in the argument that I should exercise my discretion and proceed to adjudicate the matter despite its mootness. This issue is unlikely to recur in the future since Altmann has agreed to provide the information requested to anyone who asks for it, including United Soils and/or Cloke. There is no issue of law of broader public importance raised by the Application. While Altmann is desirous of “clearing his name” through adjudication of the Application, the Application itself did not directly advance such allegations.[^3] Proceeding to consider the merits of the Application would focus on the specific relief sought, which might or might not result in Altmann “clearing his name”. There is no evidence on the record indicating that a failure to adjudicate this Application on the merits would have a chilling effect on future charitable efforts in the community.

[16] The matters raised in the Application are moot, and I would not exercise my discretion to proceed with adjudication on the merits. Accordingly, the Application is dismissed.

Costs

[17] The general rule is that where a proceeding is settled on all issues except for costs, the court is slow to make an award of costs against one of the parties.[^4] Here, Altmann’s provision of the financial information on May 25, 2017, and United Soil’s acceptance of that information, essentially settled the dispute between the parties. Altmann offered to settle the Application on a without costs basis, with this offer open until June 30, 2017. Given the voluntary settlement of the issues, involving compromise on the part of each of the parties, this would have been an appropriate basis upon which to resolve the matter. Accordingly, I would decline to make any costs award with respect to the period prior to June 30, 2017.

[18] However, rather than proceed on the basis of his own earlier proposal to settle, Altmann then reversed course and sought adjudication of the Application on the merits. This necessitated the preparation of materials and argument of the mootness issue before me on October 19, 2017. As I have found the Application to be moot, I believe it is appropriate to award United Soils its costs for the preparation and argument of the motion, incurred between June 30, 2017 and October 19, 2017.

[19] United Soils submitted a Bill of Costs for the time spent and disbursements incurred from June 30, 2017 to October 19, 2017. While I agree that the bulk of the time spent was appropriate and necessary, the materials prepared by the Applicant included a considerable amount of extraneous material, including media accounts dealing with a wide variety of matters that fell outside of the issues relevant to the Application. I also note that counsel for United Soils had devoted considerable time to this matter during the period prior to June 30, 2017, which should have reduced the time required for preparation of the motion materials.

[20] Taking all of these factors into account, I would fix costs payable by Altmann to United Soils on a partial indemnity basis at $12,500, inclusive of disbursements and H.S.T., to be paid within 30 days.

P. J. Monahan J.

Date: November 24, 2017

[^1]: Borowski v. Canada (Attorney General), [1989] 1 S.C.R. 342. [^2]: Tamil Co-operative Homes Inc. v. Arulappah, [2000] O.J. No. 3372 (C.A.) at para. 13. [^3]: The Application stated that “certain members of the public” had raised concerns over the status of the Fund, and that United Soils and Cloke had been unable to verify the accuracy of these statements. [^4]: Waterloo North Condominium Corporation No. 161 v. Redmond, 2017 ONSC 1304; Muskala v. Sitarski, 2017 ONSC 2842.