Paulpillai in her Capacity as the Estate Trustee for the Estate of Paulpillai et al. v. Yusuf et al.

[Indexed as: Paulpillai Estate v. Yusuf]

Ontario Reports

Ontario Superior Court of Justice

Fowler Byrne J.

February 6, 2020

149 O.R. (3d) 234 | 2020 ONSC 851

Case Summary

Arbitration — Applicability of arbitration clause — Ontario partnership having business interests in the Commonwealth of Dominica and St. Vincent and the Grenadines — Dispute arising between surviving partners and widow of deceased partner — Partnership agreement containing arbitration clause — Respondents took significant steps to respond to application in Superior Court of Justice and thus waived the right to have issues determined by arbitration.

Civil procedure — Application — Parties engaged in complex matter over partnership agreement and ownership and operation of business interests covering multiple jurisdictions — With various affidavits having been filed and significant disagreements over facts and expert evidence being required, application was converted to an action.

Civil procedure — Parties — Adding parties — Necessary parties — Ontario partnership having business interests in St. Vincent — Widow of deceased partner alleging that surviving partner's purchase of [page235] university in St. Vincent breached partnership non-competition clause — University was prima facie a necessary party to the proceedings.

Civil procedure — Sealing order — Parties engaged in complex matter over partnership agreement and ownership and operation of business interests covering multiple jurisdictions — Two interim sealing orders having already been made, there was no need to seal the entire file.

Conflict of laws — Jurisdiction — Contracts — Ontario partnership having business interests in the Commonwealth of Dominica and St. Vincent and the Grenadines — Dispute arising between surviving partners and widow of deceased partner — Ontario court had jurisdiction pursuant to partnership agreement.

Courts — Jurisdiction — Superior Court of Justice — Ontario partnership having business interests in the Commonwealth of Dominica and St. Vincent and the Grenadines — Dispute arising between surviving partners and widow of deceased partner — Ontario court had jurisdiction pursuant to partnership agreement.

Partnership — Partnership agreement — Non-competition clause — Ontario partnership having business interests in the Commonwealth of Dominica and St. Vincent and the Grenadines — Widow of deceased partner alleging that surviving partner's purchase of university in St. Vincent breached partnership non-competition clause — Ontario court had jurisdiction pursuant to partnership agreement — University was prima facie a necessary party to the proceedings.

The individual respondent and the deceased had been business partners as well as directors and shareholders of the corporate respondents. One of the corporate respondents was incorporated in the Commonwealth of Dominica and operated a medical school. Another was incorporated in St. Vincent and the Grenadines and also operated a medical school. A third was incorporated in Ontario and carried on the business of managing the other two. Another respondent was a Canadian partnership equally owned and managed by the individual respondent and the deceased. They were all managed and operated as related business units. The deceased's widow, the applicant, was his sole executor and trustee. After his death the individual respondent proposed to her that the business enterprise be dissolved and that each of them become the owners and managers of one of the two schools. After two years of negotiation they came to an agreement, but the applicant contended that despite the agreement the respondent continued to manage and control both schools and their funds without regard to her rights and interests. She brought an application seeking various forms of relief, which was followed by two motions by the applicant and one motion by the respondents. Prior to being served with the notice of application, the individual respondent had been approached by the dean of the American University of St. Vincent to purchase the university, which he did. The matter came before the court as an application to determine the following issues: whether the court had jurisdiction given the foreign domicile of the schools and the arbitration of dispute clause in the partnership agreement; whether a monitor should be appointed to obtain the necessary information to complete the partnership accounting and calculate an equalization payment; whether the individual respondent should be restrained from having any involvement in any medical school in St. Vincent and the Grenadines; whether there should be any interim disbursement to either party pending the division and termination of the business partnership; whether to add the American University of St. Vincent [page236] and its previous owner as parties to the application; whether the application should be converted to an action; and whether the court file should be sealed.

Held, the application should be allowed in part.

The partnership agreement clearly stated that it was to be construed in accordance with the laws of Ontario and that any disputes should be resolved through an arbitration. Thus, there was jurisdiction, but no Ontario order was enforceable in either of the foreign jurisdictions. There was no motion to stay the action and the respondents had taken significant steps to respond to the application, so they had waived their right to have the issues determined by arbitration.

The appointment of a monitor was proper and warranted. The relief was injunctive in nature. There was a serious issue to be tried, the applicant would suffer irreparable harm without such relief, and no overriding inconvenience would be suffered by either party. Appointment of a monitor appeared to be the only way in which the partnership and corporate division and accounting could be accomplished with fair treatment of both parties.

The partnership agreement prohibited competition for five years from the date of termination, in this case the date of death. Again, there was a serious issue to be tried, there would be irreparable harm to the applicant if an injunction against competition were not granted, and with respect to the balance of convenience, the American University of St. Vincent could continue to operate but with certain restrictions preventing it from acquiring additional students or staff pending final resolution of the dispute.

There was an urgent need for funds for the St. Vincent and the Grenadines school, but no such need for the school in the Commonwealth of Dominica, so the former was granted access to $1 million, but with the applicant required to account for their expenses to the monitor.

The American University of St. Vincent was prima facie a necessary party to the proceedings given its acquisition by the individual respondent and the resulting allegations of breaches of fiduciary duty and of the non-competition clause of the partnership agreement.

The application was converted to an action. Many lengthy and complex affidavits had already been filed and the parties' evidence conflicted on even the most mundane facts. Expert opinions would be needed on financial and tax issues spanning at least four corporate entities and three geographical jurisdictions. The issues before the court had changed and the parties had different positions on what issues remained outstanding.

Two interim sealing orders had already been made and would remain in place, but there was little or no evidence as to why sealing the entire file would be in the interests of justice.

Collins v. Canada (Attorney General) (2005), 2005 ON SC 28533, 76 O.R. (3d) 228, [2005] O.J. No. 2317, [2005] O.T.C. 433, 18 C.P.C. (6th) 127, 139 A.C.W.S. (3d) 815 (S.C.J.); RJR-MacDonald Inc. v. Canada (Attorney General), 1994 SCC 117, [1994] 1 S.C.R. 311, [1994] S.C.J. No. 17, 111 D.L.R. (4th) 385, 164 N.R. 1, J.E. 94-423, 60 Q.A.C. 241, 54 C.P.R. (3d) 114, 46 A.C.W.S. (3d) 40, REJB 1994-28671, apld

Other cases referred to

Abrahamovitz v. Berens (2018), 140 O.R. (3d) 161, [2018] O.J. No. 1404, 2018 ONCA 252, 292 A.C.W.S. (3d) 172, 37 E.T.R. (4th) 1; Gordon Glaves Holdings Ltd. v. Care Corp of Canada Ltd. (2000), 2000 ON CA 29058, 48 O.R. (3d) 737, [2000] O.J. No. 1989, [page237] 2000 ON CA 3913, 186 D.L.R. (4th) 577, 133 O.A.C. 111, 7 B.L.R. (3d) 1, 46 C.P.C. (4th) 204, 97 A.C.W.S. (3d) 71 (C.A.); Holden v. Infolink Technologies Ltd., [2004] O.J. No. 4245, [2004] O.T.C. 894, 48 B.L.R. (3d) 169, 2004 ON SC 34078, 134 A.C.W.S. (3d) 420 (S.C.J.); Lansens v. Onbelay Automotive Coatings Corp., [2006] O.J. No. 5470, 32 B.L.R. (4th) 113, 156 A.C.W.S. (3d) 598, 2006 ON SC 51177 (S.C.J.); Loblaw Brands Ltd. v. Thornton, [2009] O.J. No. 1228, 78 C.P.C. (6th) 189, 176 A.C.W.S. (3d) 141 (S.C.J.); McKercher v. McKercher, [2019] O.J. No. 5111, 2019 ONSC 5797 (S.C.J.); Ontario Federation of Anglers and Hunters v. Ontario (Minister of Natural Resources and Forestry) (2015), 128 O.R. (3d) 501, [2015] O.J. No. 6723, 2015 ONSC 7969, [2016] 1 C.N.L.R. 196 (S.C.J.); Vancouver Sun (Re), [2004] 2 S.C.R. 332, [2004] S.C.J. No. 41, 2004 SCC 43, 240 D.L.R. (4th) 147, 322 N.R. 161, [2005] 2 W.W.R. 671, J.E. 2004-1332, 199 B.C.A.C. 1, 33 B.C.L.R. (4th) 261, 184 C.C.C. (3d) 515, 21 C.R. (6th) 142, 120 C.R.R. (2d) 203, 61 W.C.B. (2d) 216, REJB 2004-66287, JCPQ 2004-86; Waxman v. Waxman, [2005] O.J. No. 698, 2005 ON SC 4450 (S.C.J.)

Statutes referred to

Arbitration Act, 1991, S.O. 1991, c. 17 [as am.], s. 7(1)

Business Corporations Act, R.S.O. 1990, c. B.16, s. 248(3)(b)

Courts of Justice Act, R.S.O. 1990, c. C.43, ss. 101 [as am.], 106

Rules and regulations referred to

Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rules 5.03, 38.10(1)(b)

APPLICATION for various forms of relief.

Edwin G. Upenieks and Joseph Figliomeni, for applicants.

Osborne G. Barnwell, for respondents.

[1] BYRNE J.: — This Application relates to a lengthy and complex dispute between a partner and the estate of his former partner in a business enterprise that owned and operated two medical schools in the Caribbean.

[2] Following the death of one of the partners, the parties attempted to split the enterprise, but have encountered numerous difficulties for over the last two years. Unfortunately, this litigation ensued.

I. Facts

The parties

[3] Richmond Gabriel Paulpillai ("Richmond") was an individual who resided in Brampton, Ontario. He was a director and shareholder of respondents MEERC Inc., All Saints University Limited and All Saints University School of Medicine. He was also a partner in Medical Education Examination Resource Centre. Richmond died on December 22, 2016.

[4] The Applicant Theresa Yogaranie Paulpillai ("Theresa") is Richmond's widow. She is also an Applicant in her capacity as an Estate Trustee for Richmond's Estate. She was named as the [page238] sole executor and trustee of Richmond's estate and is the sole beneficiary of all his personal and corporate assets.

[5] Richmond is also survived by his and Theresa's three children, Maneharran Paulpillai ("Mane"), Aneka Paulpillai ("Aneka") and Marie Paulpillai ("Marie"). Mane is also an Applicant in these proceedings.

[6] The respondent Joshua Akanni Yusuf ("Yusuf") is an individual who resides in Maple, Ontario. He was Richmond's business partner. He too is a director and shareholder of respondents MEERC Inc., All Saints University Limited and All Saints University School of Medicine. He is also a partner in Medical Education Examination Resource Center.

[7] The respondent All Saints University School of Medicine Limited is a company incorporated in the Commonwealth of Dominica ("ASU Dominica") and carries on the business of a medical school. Richmond held 40 per cent of the shares, Yusuf holds 40 per cent of the shares and the remaining 20 per cent are held by David Bruney (10 per cent), Dr. Avonelle Pinard (5 per cent) and Frankie Bellot (5 per cent). Richmond was the Director of Administration, Chancellor and Chairman. Yusuf was the Director of Academics and President.

[8] The respondent All Saints University Limited was incorp-orated in St. Vincent and the Grenadines ("ASU SVG") and carries on the business of a medical school. Richmond held 40 per cent of the shares, Yusuf holds 40 per cent of the shares and the remaining 20 per cent are held by MEERC Inc. (5 per cent), David Bruney (10 per cent) and Dr. Avonelle Pinard (5 per cent). Richmond was the Director of Administration, Chancellor and Chairman. Yusuf was the Director of Academics and President.

[9] The respondent MEERC Inc. is a company incorporated in Ontario. It carries on the business of management of both ASU Dominica and ASU SVG. Yusuf and Richmond each owned 50 per cent of the shares of MEERC Inc.

[10] The Medical Education Examination Resource Center (the "Center"), which is an entity distinct from MEERC Inc., is a Canadian partnership equally owned and managed by Richmond and Yusuf. The Center holds tuition payments, dividends and profit distributions for both ASU Dominica and ASU SVG. The accounts of this partnership hold both current earnings and a substantial amount of earnings accumulated in the years prior to Richmond's death and which have never been distributed. [page239]

Business structure

[11] Although MEERC Inc., the Center, ASU Dominica and ASU SVG are all separate entities from different jurisdictions, they were managed and operated as related business units. While Richmond was alive, the two universities shared recruiting efforts and expenses and allocated students between the campuses according to capacity. Both ASU Dominica and ASU SVG have students from Ontario. ASU Dominica has been accredited by the Ontario provincial government, which enables prospective students to qualify for provincial loans, such as the Ontario Student Assistance Program ("OSAP").

[12] A Partnership Agreement was signed by Richmond and Yusuf on May 25, 2004, whereby they started a partnership called "MEERC Inc. (Medical Education Examination Resource Center -- MEERC INC.)", which was based in Toronto, Ontario (the "Partnership Agreement").

[13] The relevant provisions of their Partnership Agreement included:

1.2 Partnership Interests

Each Partner shall have an equal interest in the Partnership.

TERMINATION/DISSOLUTION

This Agreement will be terminated and the Partnership dissolved in the event that:

(a) The Partners so agree in writing;

No dispute or notice of intention to dissolve will on its own dissolve the Partnership or terminate the Agreement.

On dissolution, all of the Partnership assets and liabilities will be divided and applied in the following order:

(i) payment of the Partnership's debts and other liabilities;

(ii) to pay out all credit balances in the Partners' income accounts;

(iii) to pay out all credit balances in the Partners' capital accounts; and

(iv) to additionally distribute among the Partners, in proportion to each Partner's Partnership Interest.

In the event of disagreement over an asset valuation, which cannot be settled by the Accountants, the asset(s) in question are to be sold and the income from such sale then distributed accordingly.

Despite dissolution of the Partnership or other termination of this Agreement, the obligations to be performed and/or observed by any party to this Agreement which by their nature, content or context are meant to survive such dissolution, termination or withdrawal, including without limitation [page240] those related to confidentiality, non-competition and responsibility for Partnership liabilities, will survive any such expiration or termination. No dissolution or termination of this Agreement will affect or prejudice any rights or obligations, which have accrued or arisen prior to the time of such dissolution or termination and such rights and obligations will survive until fulfilled.

NON-COMPETITION

For so long as a Partner is a Partner and for a period of five years from the date on which he ceases to be a Partner for any reason, including without limitation to the dissolution of the partnership, such partner will not, directly or indirectly, in any manner whatsoever including, without limitation, either individually, or in partnership, jointly or in conjunction with any other Person, or as employee, principal, agent, director or partner:

(i) be engaged in any undertaking;

(ii) have any financial or other interest (including an interest by way of royalty or other compensation arrangements) in or in respect of the business of any Person which carries on a business; or

(iii) advise, lend money to or guarantee the debts or obligations of any Person which carries on a business;

which is substantially similar to or which competes with the Business, as carried on by the Partnership up to and as of the date on which the Partner ceases to be a Partner in any area in which the Partnership carries on the Business.

Each Partner acknowledges that the non-competition obligations contained herein:

c) are not in substitution for any obligations which such Partner may now or hereafter owe to the Partnership or any other Partner and which exist apart from this Agreement; and

d) do not replace any rights of the Partnership or any Partner with respect to any such obligation.

ARBITRATION OF DISPUTE

If any claim, controversy or dispute of any kind or nature whatsoever arises between the parties ("Dispute"), and the parties are unable to settle it through negotiation, then it will be resolved by arbitration, by a single arbitrator who is knowledgeable about the matter in Dispute. Any party to the dispute (a "Disputing Party") may begin the arbitration process by providing written notice of arbitration, together with the name of a suggested arbitrator (the "first nominee") to the other Disputing Party (the "Arbitration Notice"). The other Disputing Party will have no more than 10 business days in which to agree to said first nominee as the arbitrator or to suggest another (the "second nominee"). If said other Disputing Party does not respond to the first Party's Arbitration Notice within 10 business days of receipt of the Arbitration Notice, said second Party will be deemed to have accepted as arbitrator the first nominee. If the Disputing Parties cannot agree on an arbitrator within 10 business days of the second Party's receipt of the Arbitration Notice, then the first nominee alone, or if the second Party suggested a second nominee then the first nominee and [page241] the second nominee to gather will nominate a third person as arbitrator within the next 10 business days. Said nomination will be final. The arbitrator thus determined will conduct the arbitration in accordance with the Arbitration Act, Ontario for arbitrations conducted with a single arbitrator, subject to such modifications as the arbitrator may determine in compliance therewith. The arbitration will be conducted at the place set out therefore in the Arbitration Notice. Each Disputing Party will bear its own costs and legal fees, and the Disputing Parties will share equally the fees and expenses of the arbitrator. The arbitrator will not have authority to award punitive damages. The arbitrator's decision and award will be final and binding not subject to appeal, and judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. All aspects of any arbitration, including any decision by the arbitrator, will be deemed to be Confidential Information for the purposes of this Agreement.

The following matters will be excluded from arbitration:

e) any claims involving a Third Party against one or more Parties;

f) any claim for interim or interlocutory injunctive relief;

g) claims involving injury to persons or damage to tangible property.

Notwithstanding the foregoing, the parties agree that certain matters may arise that require resolution more quickly than by negotiation or arbitration, and that injunctive relief may be the only effective relief for a breach of certain covenants in this Agreement, which breach may cause a party irreparable harm if not remedied immediately, non-compensable by damages alone. Each party agrees that the other parties will be entitled, provided they are acting in good faith, to seek equitable and injunctive relief on an interim and interlocutory basis in any court of competent jurisdiction or specific performance or other equitable remedies, in addition to any other remedies available to it, to enforce any of the party's covenants in the event of such a breach or threatened breach thereof, without first complying with the arbitration procedures described herein.

APPLICABLE LAW

This Agreement will be construed in accordance with and governed by the laws of Ontario and the laws of Canada applicable herein.

[14] Richmond Paulpillai and Yusuf entered into an Addendum to Shareholders/Partnership Agreement on November 27, 2012. The relevant provisions of this addendum are as follows:

Power of Attorney

If and when a shareholder/director of All Saints University, Dominica or St. Vincent and the Grenadines dies or incapacitated (certified by a doctor) or retires after eight years of service to the University or at 60+ years of age, the ability, privilege and right to endorse legal or business documents for and on behalf of All Saints University is automatically transferred to his/her next of kin (spouse, a child or sibling in this order of significance). If it is a child, all endorsements by the child requires the guidance of the family attorney. [page242]

Remuneration, Dividends and Salary

If and when a shareholder/director of All Saints University, Dominica or St. Vincent and the Grenadines dies or incapacitated (certified by a doctor) or retires after eight years of service to the University or at 60+ years of age, his or her remuneration, the prevailing salary and dividend comparable to that of the living/existing director/ shareholder of the same/equal share interests of the University will continue to be paid to the next of kin of the director/ shareholder. In this wise [sic], the designated next of kin becomes the earner of the salary, remuneration, dividends etc. on behalf of the family of the deceased or incapacitated shareholder/director.

No shareholder or director shall be able to acquire the share interests, rights or privileges of the deceased or incapacitated shareholder or director under any circumstances. Transfer or sale of share interest, right and privilege shall be voluntary. In case of retirement, a competent hand recommended and approved by at least two directors must be employed to carry on the responsibilities of the retired director.

(the "Addendum").

[15] In addition to the provision set forth in the Addendum, the by-laws of ASU SVG, dated May 26, 2011, state:

Death of a shareholder. Upon the death of a shareholder, his shareholding interest shall form a part of his estate and shall be devolved on the beneficiaries of his estate in accordance with the Administration of Estates Act of the Laws of St. Vincent and the Grenadines or in accordance with the Wills Act of the Laws of St. Vincent and the Grenadines.

A shareholder shall not acquire the shareholding interest of a deceased shareholder.

[16] No evidence of a similar by-law with respect to ASU Dominica was provided.

[17] Richmond Paulpillai had a will, which named Theresa as his sole executor and trustee. She is also the sole beneficiary of all his personal and business assets. Theresa applied for probate in Saint Vincent and the Grenadines on September 25, 2018 which was granted on December 31, 2018. Theresa applied for probate in Dominica on October 18, 2018 which was granted on or about January 24, 2019.

Events following Richmond's death

[18] Following Richmond's death, Yusuf proposed that the business enterprise be dissolved and that he and Richmond's family each become the owners and managers of one of the two universities.

[19] Over the next two years, the Paulpillai family claims they attempted to gather information regarding Richmond's assets in order to get probate in both St. Vincent and the Grenadines and in Dominica. At the same time, they claim they were trying to [page243] review the books and records of each university for the purpose of determining which university they would take over. Theresa maintains that this was difficult because Yusuf maintained exclusive possession and control of critical documents, financial accounts and information concerning the assets, liabilities and operations of all the entities in which Yusuf and Richmond held an interest. It is alleged that Yusuf failed to advise the banks in Dominica and St. Vincent and the Grenadines of Richmond's death, which would have frozen the accounts.

[20] Eventually, Theresa states that without full access to all the pertinent information, and having been threatened with having her compensation cut off, on September 6, 2018 she elected to take ASU SVG. Yusuf accepted this election and asserts that as of September 7, 2018, he owns and manages ASU Dominica without the involvement of the Paulpillai family and that the Paulpillai family should own and manage ASU SVG without the involvement of Yusuf.

[21] This application was commenced because Theresa alleges that despite their agreement, Yusuf continued to manage and control both universities and its funds without regard to the rights and interests of the Paulpillai family. She alleges that Yusuf has exercised all management authority on an exclusive basis and has systematically excluded the Paulpillai family from all management decisions and oversight and taken actions that they allege have favored his own interests over that of the Paulpillai family.

[22] At first, she alleges Yusuf refused to resign from the board of ASU SVG. She maintains that Yusuf refused to appoint her or her designates to the board of her university or share management authority with her. He refused to consult with her or even inform her in advance of important management decisions such as the hiring, firing and transfer of faculty and staff. He has refused to provide her with notices of meetings of shareholders or directors of her university or invite her to attend or even monitor those meetings.

[23] Theresa also noticed that after electing to keep ASU SVG, Internet advertising for ASU Dominica was more prominent and robust than the advertising for ASU SVG. Within a week of her electing to keep ASU SVG, Yusuf transferred a key professor and Dean of student affairs of ASU SVG to ASU Dominica. In November 2018, the Academic Dean at ASU SVG resigned. In total, two Deans at ASU SVG have been relocated or resigned, and the Executive Dean for both ASU SVG and ASU Dominica has announced that he will be leaving ASU SVG. This has caused destabilization at ASU SVG and caused concern and [page244] uncertainty amongst the students and staff. Theresa alleges that she was not informed or consulted regarding these changes which she believes were taken in an effort to damage ASU SVG by encouraging students to transfer to ASU Dominica.

[24] Theresa is also concerned that Yusuf is spreading harmful and derogatory rumours regarding the Paulpillai family amongst the students and faculty at ASU SVG. She has also learned that many students have now transferred from her university to ASU Dominica for unknown reasons.

[25] Also, after Yusuf was served with this Application, Theresa learned that Yusuf intended to acquire a competing medical school in St. Vincent and the Grenadines, namely, the American University of St. Vincent. This acquisition has now been completed.

[26] Finally, Theresa alleges that she has received no accounting for the funds of the partnership since Richmond's death and thereafter. She maintains that funds are being moved without her knowledge or consent and a proper accounting of the partnership has not been completed.

[27] Accordingly, she commenced this application wherein she sought the following:

(a) a declaration that the affairs of MEERC Inc., the Center, ASU Dominica and ASU SVG have been carried on in a manner that is oppressive, unfairly prejudicial to and unfairly dis-regards the interests of the Applicants;

(b) an order remedying the oppression, including without limitation, an order for monetary damages of $10 million;

(c) a declaration that Yusuf breached the Partnership Agreement;

(d) an order for damages for breach of the Partnership Agreement, breach of fiduciary duty in Yusuf's capacity as director, shareholder and partner in carrying out the affairs of ASU Dominica and ASU SVG, and unjust enrichment, in the sum of $10 million;

(e) an order that Yusuf and the corporate respondents provide an accounting and tracing of all monies received and disbursed since the death of Richmond Paulpillai;

(f) an order enforcing the terms of the separation agreement;

(g) an order setting aside corporate transactions that were not properly entered into by the corporate respondents;

(h) an order compelling Yusuf and the corporate respondents to disclose to the court and applicants all instances of self-dealing and conflicts of interest; [page245]

(i) an interim and interlocutory order:

(1) ordering Yusuf and the corporate respondents to provide a sworn statement identifying all entities and assets in which Richmond Paulpillai had a direct or indirect interest;

(2) restraining the respondents from altering, destroying or withholding any documents or things of any nature or kind related to the business of the corporate respondents;

(3) restraining the respondents from selling, removing, dissipating, alienating, transferring, assigning, encumbering, or similarly dealing with any assets of the corporate respondents;

(4) compelling the respondents or anyone having knowledge of the terms of any order that is made to provide the Applicants with immediate and continued access to copies of the complete books and records of the corporate respondents and to provide the Applicants with all passwords and/or pins to bank accounts, credit cards, electronic accounts and websites belonging to the corporate respondents;

(5) appointing a receiver, without security, of all the assets, undertakings and properties of the corporate respondents; and

(6) restraining the respondents or anyone who has knowledge of the terms of the order from taking any actions that may damage the reputation or goodwill of the corporate respondents; and

(j) an order appointing Theresa as the litigation administrator to represent Richmond Paulpillai's estate in this proceeding.

First appearance -- February 1, 2019

[28] At the first attendance of this Application on February 1, 2019, the parties were able to negotiate and agreed upon the terms of an Order which set out a process to effect the corporate separation, which included granting the injunctive relief sought. The Application was otherwise adjourned sine die to be brought back with a minimum of 14 days' notice, except in the case of an urgent matter. The order also provided that I was seized of this matter, and either party could appear before me to vary or amend this order. [page246]

[29] It should be noted that while Yusuf had not filed any responding materials before the attendance on February 1, 2019, he did file responding materials before the next appearance. In these materials, Yusuf maintains that it was always his intention to finalize the division of the two medical schools, but it was Theresa's delay in being granted probate in Dominica and St. Vincent and the Grenadines that delayed the finalization. By the time they were served with the Application Record, Theresa had just received her probate in these two jurisdictions.

[30] Yusuf also maintained that Theresa and her family had complete and unfettered access to the books and records of both medical schools prior to deciding which medical school she wished to acquire. He feels he has satisfied his obligation. He also states he has co-operated fully with the demands for information following the February 1, 2019 order.

Financial and administrative disclosure

[31] Unfortunately, the orderly split of the partnership did not go as hoped by the parties. The Applicants maintain that Yusuf has not fulfilled his disclosure obligations as set out in the February 1, 2019 order. The Applicants want unfettered access to all information and communication related to both universities for the period that Richmond or his estate had an interest. Theresa also alleges that communication between the staff of the two universities has broken down, making the exchange of information even more problematic.

[32] There is clearly a lack of trust and communication between the parties. They both maintain they are following the letter and spirit of the February 1, 2019 order, and both deny the other is doing so. Even the accountant for MEERC Inc., Mr. Yeboah, has recommended that a neutral third party be hired to oversee the separation process. Even if the separation is completed, an accounting is still required for the period from the date of Richmond's death until the separation is complete.

Purchase of the American University of St. Vincent

[33] Yusuf states that prior to being served with the Notice of Application, he was approached by the Dean of the American University of St. Vincent ("AUS") who was seeking a buyer. Yusuf claims the Paulpillai family was first approached in late 2018, but they declined. Yusuf claims that the Government of St. Vincent wished to save the school and wanted someone with experience to take it over. Yusuf's name was offered as a viable option.

[34] Yusuf claims that he did not pursue this opportunity in earnest until after the order of February 1, 2019. He claims that [page247] he understood that he was free to compete after this date. He did agree though, to not solicit students from the ASU SVG. Accordingly, Yusuf maintains the position that the issue of competing with ASU SVG on the island of St. Vincent and the Grenadines has been settled, and that there are no provisions in the February 1, 2019 order that prohibit him from doing so.

[35] Accordingly, Yusuf proceeded with his plan to take over the ownership and management of AUS. Theresa alleges that not only is Yusuf soliciting students to AUS, but he is also soliciting staff.

Second appearance -- April 4, 2019

[36] As a result of the breakdown in the orderly split of the business enterprise and the purchase of AUS by Yusuf, the parties filed further affidavit material and the matter was scheduled to be argued before me on April 4, 2019. In addition to the relief sought in the original Application, the Applicants renewed their request for the appointment of a monitor who would investigate the dealings of the various corporate defendants but also sought (1) an order that Yusuf not manage or operate any medical school in Saint Vincent and the Grenadines which would be in competition with ASU SVG; (2) an order adding AUS and its previous owner as parties to the Application; (3) an order converting this application into an action; and (4) a sealing order of the entire file.

[37] Unfortunately, argument on these issues was not completed on April 4, 2019. The application and the motion were further adjourned, allowing the parties to deliver further materials to allow for cross-examinations.

[38] Yusuf has also raised the issue of the appropriateness of Ontario making a decision that binds a university incorporated in another legal jurisdiction. The February 1, 2019 consent order directing that certain parties be removed as directors from the universities has not been accepted by the banks in the Caribbean because the Order, made in Ontario, needed to be registered with the courts in their respective jurisdiction. The Applicants have advised that there is no immediate recognition of a Canadian order in St. Vincent and the Grenadines. On July 1, 2019, the law changed to recognize Canadian orders, but it is restricted to the enforcement of money judgments. The appointment and removal of directors would not be automatically enforceable.

Third appearance -- August 7, 2019

[39] While it was intended that the application and motion from April 2019 be argued on this day, both parties brought further motions. [page248]

[40] The Applicants moved for an order directing the immediate release to the Applicants of USD$2 million belonging to the partnership, pending equalization of the partnership funds. They also sought an order restraining Yusuf, or others acting on his behalf, or anyone having knowledge of this order, from engaging in false, deceptive or misleading advertising on Google related to ASU Dominica, ASU SVG and the American University.

[41] The respondents brought their own motion wherein they sought an order that Mr. Yeboah continue to provide an accounting with respect to the equalization of assets and liabilities of all the corporate entities (as opposed to a court appointed monitor); that the court direct that before the release of any funds to any party, all debts to MEERC Inc., including loans to Path Excellence Inc. (Yusuf's company) and others, be paid first; or that each party receive an interim disbursement of $1 million until which time the corporate divorce is finalized. The respondents also seek an order that MEERC Inc. and any other relationship between the parties be terminated or dissolved within one month of the equalization and that parties be equally responsible for any outstanding liability of MEERC Inc.

[42] The request for interim disbursements comes from the uncertain status of ASU SVG's governance until which time the partnership division is finalized. The Applicants maintain that ASU SVG's ability to move moneys and pay for the ongoing operations of their medical school has been limited due to the transition in place. At the time these motions were originally brought, Theresa was not recognized by the banks to have the authority to move money as she wishes. She now has limited authority.

[43] Frankly, the affidavit evidence of the financial net worth of either university, MEERC Inc. or the partnership is less than complete. Statements are made about the amount of money each entity has, but very little third party records have been given to support that. The Applicants indicate that Yusuf has USD$6 million available to him, which is denied by Yusuf.

[44] That being said, Yusuf has admitted that $1 million could be released for each of the universities to allow them operating funds for a period of two months. He maintains that the corporate division should be completed in that time period. He is not willing to release monies only to the Applicants until which time the division and accounting is complete. He has also conceded that approximately USD$4.6 million is currently in a Paypal account that is related to both medical schools. The charts provided by Yusuf also show that as of February 1, 2019, ASU Dominica had more on deposit at banks than did ASU SVG. [page249] There is no accounting of the balance of the accounts on the date that Richmond died, or what has happened since then.

[45] Despite his best efforts, the Applicants maintain that Mr. Yeboah, the company accountant for MEERC Inc., has not been able to provide the full and unfettered financial disclosure required of the Applicants. He is also not impartial, having worked for Yusuf alone following Richmond's death. The Applicants also have some concerns about Mr. Yeboah's ability to handle such a large and complex task. As indicated above, Mr. Yeboah himself has recommended that a neutral third party be hired to oversee the separation process.

[46] Finally, ASU SVG has become concerned that Yusuf may have been using partnership funds to unfairly disadvantage ASU SVG in their advertisement and solicitation of students. The Applicant showed that for a period of time, a potential student who did a "Google search" for ASU SVG and clicked the link for that school would be directed to ASU Dominica's webpage. The court was advised that this has been since corrected. The Applicants claim that misleading advertising has caused a significant drop in student enrollment. Again, no evidence has been presented other than a self-serving chart created by the affiant. It has also been alleged that Yusuf has misappropriated ASU SVG's LinkedIn account. This is in addition to the allegations that students have been pressured to leave ASU SVG and attend ASU Dominica and that staff were poached.

II. Issues

[47] Accordingly, the issues to be decided arise from the original Notice of Application, two additional motions brought by the Applicants and one additional motion brought by the respondents. In summary, the following issues must be resolved in this Application:

(a) Does this court have jurisdiction to adjudicate this matter given the foreign domicile of ASU Dominica and ASU SVG and the Arbitration of Dispute Clause in the Partnership Agreement?

(b) Should a monitor be appointed to obtain the necessary information, complete the partnership accounting and cal-culate the equalization payment as directed in the February 1, 2019 Order, or should Mr. Yeboah continue in that role?

(c) Should an interim order be made restraining Yusuf from becoming involved or having any ownership or management of any medical school in St. Vincent and the Grenadines, including the American University of St. Vincent? [page250]

(d) Should there be any interim disbursement made to either party pending the division and termination of the business partnership?

(e) Should the American University of St. Vincent and its previous owner be added as parties to this application?

(f) Should this matter be converted to an Action?

(g) Should this court file be sealed?

III. Analysis

A. Jurisdiction of the court

[48] The Partnership Agreement states clearly that it was to be construed in accordance with the laws of Ontario. The two principal partners reside in Ontario. MEERC Inc. and the Center are domiciled in Ontario. Accordingly, any determination of the parties' rights and obligations with respect to MEERC Inc. and the Center are properly within the jurisdiction of this court.

[49] The difficulty arises with respect to ASU Dominica, ASU SVG and the proposed defendant AUS. None of these corporate parties were incorporated in Ontario. None of them are subject to any regulations in Ontario. While these parties do take steps to ensure their students may be qualified to eventually practice medicine in Ontario, the corporate governance is run in accordance with the jurisdiction in which it was incorporated and operates.

[50] Accordingly, while an order can be made that compels MEERC Inc., the Centre, Yusuf or the Applicants to take certain actions with respect to the two universities, an Order of the Superior Court of Justice is of no force or effect in either Dominica or St. Vincent and the Grenadines, unless adopted in that jurisdiction by whatever process is appropriate in that jurisdiction.

B. Arbitration clause

[51] The Partnership Agreement clearly states that any disputes should be resolved through an arbitration. The Partnership Agreement also makes it clear that injunctive relief may be sought outside of the arbitration process.

[52] Accordingly, nothing prohibited the Applicants from seeking their injunctive relief. The issue to be determined is whether the Applicants were entitled to bring an application for the other relief claimed such as the allegations of oppressive conduct and the claim for damages.

[53] The relevant provisions of the Arbitration Act, 1991, S.O. 1991, c. 17 state as follows: [page251]

Court intervention

6. No court shall intervene in matters governed by this Act, except for the following purposes, in accordance with this Act:

7. To assist the conducting of arbitrations.

8. To ensure that arbitrations are conducted in accordance with arbitration agreements.

9. To prevent unequal or unfair treatment of parties to arbitration agreements.

10. To enforce awards. 1991, c. 17, s. 6.

Stay

7(1) If a party to an arbitration agreement commences a proceeding in respect of a matter to be submitted to arbitration under the agreement, the court in which the proceeding is commenced shall, on the motion of another party to the arbitration agreement, stay the proceeding.

Exceptions

(2) However, the court may refuse to stay the proceeding in any of the following cases:

1. A party entered into the arbitration agreement while under a legal incapacity.

2. The arbitration agreement is invalid.

3. The subject-matter of the dispute is not capable of being the subject of arbitration under Ontario law.

4. The motion was brought with undue delay.

5. The matter is a proper one for default or summary judgment.

Arbitration may continue

(3) An arbitration of the dispute may be commenced and continued while the motion is before the court. 1991, c. 17, s. 7 (3).

Effect of refusal to stay

(4) If the court refuses to stay the proceeding,

(a) no arbitration of the dispute shall be commenced; and

(b) an arbitration that has been commenced shall not be continued, and anything done in connection with the arbitration before the court made its decision is without effect. 1991, c. 17, s. 7 (4).

Agreement covering part of dispute

(5) The court may stay the proceeding with respect to the matters dealt with in the arbitration agreement and allow it to continue with respect to other matters if it finds that,

(a) the agreement deals with only some of the matters in respect of which the proceeding was commenced; and [page252]

(b) it is reasonable to separate the matters dealt with in the agreement from the other matters. 1991, c. 17, s. 7 (5).

No appeal

(6) There is no appeal from the court's decision.

[54] Section 106 of the Courts of Justice Act, R.S.O. 1990, c. C.43, permits a court to stay any proceeding on such terms as are considered just.

[55] In the case before me, the respondents have maintained in their affidavit evidence that the matter should have proceeded by way of arbitration, but at no time did they bring a motion seeking to stay these proceedings or to compel the Applicants to proceed by way of arbitration. Section 7(1) of the Arbitration Act, 1991 makes it clear that the action can only be stayed by way of motion, and even then, the court has the discretion to refuse to grant the stay if the motion is not made in a timely manner.

[56] After being served with this Application Record, the respondents' first submission regarding the jurisdiction of the court was made in April 2019 and it was with respect to the jurisdiction of an Ontario court to make an Order that is meant to bind Dominica and St. Vincent and the Grenadines.

[57] In addition, Granger J. in Lansens v. Onbelay Automotive Coatings Corp., [2006] O.J. No. 5470, 2006 ON SC 51177 (S.C.J.), at para. 34, stated that even if the defendants to an action had a right to have the issues determined by an arbitrator, they abandoned such right when they took steps within the action. By doing so, they waived their right to insist that these claims be arbitrated.

[58] Accordingly, given that there is no motion before the court to stay the action, and given that the respondents have taken significant steps to respond to this application, including filing numerous affidavits, producing viva voce evidence in the application, conducting cross-examinations and even bringing an oral motion without formal notice seeking to remove the Applicants' counsel as solicitors of records for the Applicants, I find that the respondents have waived their right to seek to have these issues determined by way of arbitration.

C. Appointment of a monitor

[59] The court has the authority to appoint a receiver and manager by an interlocutory order where it appears to be just or convenient to do so: Courts of Justice Act, s. 101. The court has the power to make an interim order appointing a receiver or a receiver-manager as part of an application seeking an oppression remedy: Business Corporations Act, R.S.O. 1990, c. B.16, s. 248(3)(b); [page253] Holden v. Infolink Technologies Ltd., [2004] O.J. No. 4245, 2004 ON SC 34078 (S.C.J.); Waxman v. Waxman, [2005] O.J. No. 698, 2005 ON SC 4450 (S.C.J.).

[60] The appointment of a monitor is injunctive in nature. In order to grant injunctive relief, a three-part test must be satisfied: RJR-MacDonald Inc. v. Canada (Attorney General), 1994 SCC 117, [1994] 1 S.C.R. 311, [1994] S.C.J. No. 17, at paras. 83-85:

(a) Is there a serious issue to be tried?

(b) If the injunction is not granted, would the applicant suffer irreparable harm? Irreparable harm is harm that cannot be quantified in a monetary term or which cannot be cured;

(c) Which party would suffer greater harm from the granting or refusal of the remedy pending a decision on its merits?

[61] Where, without the appointment of a receiver or monitor, the plaintiffs' ability to recover could be seriously jeopardized, the balance of convenience favours maintaining the appointment: Loblaw Brands Ltd. v. Thornton, [2009] O.J. No. 1228, 78 C.P.C. (6th) 189 (S.C.J.), at para. 16, as cited in McKercher v. McKercher, [2019] O.J. No. 5111, 2019 ONSC 5797 (S.C.J.), at para. 52.

[62] I have no difficulty in finding that there is a serious issue to be tried. I also find that without such relief, the Applicants will suffer irreparable harm. Currently, the Applicants do not have sufficient knowledge or control of the partnership assets to adequately protect their interests. The longer they lack this control, the more extensive their interest in the medical school will be eroded in an unquantifiable manner.

[63] When balancing the inconvenience of the parties, I see no overriding inconvenience that may be suffered by either party. This order is made not to adjudicate on an issue, but rather to provide the accounting that is required by both parties in order to resolve or try this issue. Both parties, as owner/operators of one university, will be evenly inconvenienced by the monitors' review of their financial actions.

[64] The Applicants propose that the monitor not interfere with the day to day operations of the universities or take over operation of the universities. Rather, it is proposed that the monitor be permitted access to all books and records, bank accounts or accounting records that would allow them to facilitate ongoing payment of operation expenses by the corporate respondents in accordance with past practices, perform an audit function and determine the proper equalization payment to be made to one party. [page254]

[65] It is clear on the evidence that the separation and accounting process is far from complete. The parties disagree over whether the separation has occurred. There has been no accounting under the termination clause of the Partnership Agreement to ensure that all debts are paid up and the assets of the partnership divided. It is disconcerting that students, staff and professors are moving universities, and now Yusuf is in a position to compete directly with the Applicants. Neither party can agree if there are sufficient funds to release to any party pending the accounting. Mr. Yeboah, to his credit, has done the best he can, but the complex nature of this corporate structure requires a more professional level of oversight.

[66] Both parties want to unravel the business partnership. Both parties want, in the end, to have viable and successful medical schools, buoyed by the past financial success they have enjoyed. Both profess the desire to put into effect the termination and separation plans of Yusuf and Richmond as envisioned by them. It has not been successful to date.

[67] Accordingly, I find that the appointment of a monitor is proper and warranted in these circumstances. The appointment of a monitor, who will need the assistance of Mr. Yeboah, appears to be the only way in which the partnership and corporate division and accounting can be done in a way that ensures both parties are treated fairly. BDO has been the only investigator proposed, and they are agreeable.

D. Injunction restraining competition

[68] The Partnership Agreement is clear that competition is prohibited for a period of five years from the date the partnership is terminated. In this situation, the partnership was terminated when Richmond passed.

[69] Given that this is injunctive relief, the same test from RJR-MacDonald applies.

[70] In light of the clause in the Partnership Agreement, the Applicants have shown that there is a serious issue to be tried. Yusuf claims that the Partnership Agreement was created before they owned any medical schools in the Caribbean. The business of MEERC Inc. was to prepare students for their MCAT and their licensing exams throughout the United States and Canada. He claims they were only concerned with competition of this business within the Province of Ontario. He claims subsequent conduct of both parties confirmed this.

[71] This argument must fail. Whatever the nature of the partnership in 2004, it is not disputed that at the time of Richmond's death, MEERC Inc. and the Center were very much involved in [page255] the operation and management of a medical school in Dominica and a medical school in St. Vincent and the Grenadines. Whether the competition clause continued to survive is a serious issue to be tried.

[72] Also, I find that there would be irreparable harm to the Applicants if the injunction is not granted. The improper transfer of students and staff would be difficult to quantify. It could take years before ASU SVG is back to where it was prior to being in competition with AUS. While it is conceded that AUS may very well have continued with ownership by someone other than Yusuf, the competition that ASU SVG faces against AUS under Yusuf's control is more challenging. Any student or staff that is considering transferring to AUS will encounter familiar staff and management. This is an advantage that AUS under other management would not have.

[73] When balancing the respective inconvenience, it must be recognized that Yusuf, or any entity under his control, has already acquired AUS. Students are enrolled, and staff are employed. To prevent AUS from carrying on business at this juncture would cause irreparable harm to its students and staff who are innocent third parties. That being said, certain restrictions can be put in place that would prevent AUS from acquiring additional students or staff until which time this dispute is resolved. In addition, AUS must now account for the students, staff and additional revenue they have acquired since Yusuf has taken over ownership and/or management. The inconvenience of having to account for its enrollment and revenue is not outweighed by the loss of enrollment and revenue suffered by ASU SVG in the face of what appears to be a very clear non-competition clause.

[74] The respondents maintain that the issue of competition is res judicata. They indicate that this was a live issue in the negotiations that led to the February 1, 2019 order. The fact that competition was not specifically prohibited in the Order, it is argued, means that the non-competition clause in the Partnership Agreement is no longer binding on the parties.

[75] This argument must also fail. The Order of February 1, 2019 is not a final order. It is not a judgment. The very issue between the parties -- whether there is oppressive conduct on the part of the respondents -- has not yet been adjudicated. The claim for an accounting and equal division of the partnership and the claim for damages remain outstanding. While a procedure was put in place on February 1, 2019 to conduct an accounting and finalize the equalization payment, it did not dispense with the final adjudication of the substantive issues between the parties. [page256]

E. Conversion to an action

[76] On the hearing of an application, the presiding judge may order that the whole application or any issue proceed to trial and give such directions as are just: rule 38.10(1)(b).

[77] It is well established that an application should be used when there is no matter in dispute and when the issues to be determined do not go beyond the interpretation of a document: Collins v. Canada (Attorney General) (2005), 2005 ON SC 28533, 76 O.R. (3d) 228, [2005] O.J. No. 2317 (S.C.J.), at para. 28.

[78] When issues of credibility are involved the matter should proceed by way of an action: Gordon Glaves Holdings Ltd. v. Care Corp. of Canada (2000), 2000 ON CA 29058, 48 O.R. (3d) 737, [2000] O.J. No. 1989 (C.A.), at para. 30.

[79] In determining whether to convert an application into an action the following factors are relevant, Collins, at para. 5:

1. whether there are material facts in dispute;

2. the presence of complex issues requiring expert evidence and/or a weighing of the evidence;

3. whether there is a need for the exchange of pleadings and for dis-coveries; and

4. the importance and impact of the application and of the relief sought.

[80] Since this application was commenced, approximately 20 affidavits have been sworn and served. The majority of these affidavits are comprised of recitations of the parties' versions of the facts at issue and why the other party's recitations are inaccurate or incomplete. At times the affidavits rely on the information provided by other parties, and those other parties are not identified. The parties have conflicting evidence of what information has been exchanged and to whom. The parties have conflicting evidence on the circumstances surrounding the Partnership Agreement and its applicability. The parties' evidence conflicts on even the most mundane facts, such as what happened when Yusuf visited the Paulpillai family shortly after Richmond's death.

[81] The affidavits filed in support of and in response to the Application are lengthy and complex. An expert opinion will be needed on financial and tax issues that span at least four corporate entities and three separate geographical jurisdictions. The issues before the court have changed and the parties have different positions on what issues remain outstanding.

[82] Taking all these factors into consideration, it is clear that this application should be converted to an action, pleadings exchanged, documents disclosed and discoveries completed. [page257]

F. Adding of parties

[83] The Applicants have asked to add AUS and its previous owners as parties to this proceeding. The previous owners have not been identified in the Notice of Motion.

[84] Rule 5.03 states that every person whose presence is necessary to enable the court to adjudicate effectively and completely on the issues on a proceeding shall be joined as a party to the proceeding.

[85] If a party would be affected or prejudiced by an Order of this court, and there are no limitation issues, that party is entitled to be a party so that their voice will be heard before their rights are determined: Abrahamovitz v. Berens (2018), 140 O.R. (3d) 161, [2018] O.J. No. 1404, 2018 ONCA 252, at para. 44, relying on Ontario Federation of Anglers and Hunters v. Ontario (Minister of Natural Resources and Forestry) (2015), 128 O.R. (3d) 501, [2015] O.J. No. 6723, 2015 ONSC 7969 (S.C.J.), at paras. 10-11.

[86] Given the actions of Yusuf in purchasing AUS and given the outstanding allegation that he breached his fiduciary duty to ASU SVG and the non-competition clause of the Partnership Agreement, AUS appears prima facie to be a necessary party to these proceedings.

G. Interim disbursement of funds

[87] The financial status of ASU Dominica and ASU SVG is not clear. The respondents have conceded though that $1 million could be released to either party in order to support their operations.

[88] I am not convinced on the evidence that ASU Dominica requires funds on an urgent basis in order to continue its operations. There does appear to be an urgent need for ASU SVG.

[89] Accordingly, it is appropriate that ASU SVG has access to the sum of $1 million to facilitate the operation of their medical school, but the Applicant must account for their expenses with the Monitor. The Monitor will determine whether there will be any further disbursements to either party until which time their mandate ends.

H. Sealing A court file

[90] As a rule, the court is hesitant to restrict access to a judicial proceeding or its documentation. This is grounded on the principle that openness maintains the independence and impartiality of the courts. It is integral to public confidence in the judicial system and the public's understanding of the administration of [page258] justice: Re Vancouver Sun (Re), [2004] 2 S.C.R. 332, [2004] S.C.J. No. 41, 2004 SCC 43, at para. 25.

[91] Two interim sealing orders have already been made in these proceedings. While the request was made for the sealing of the entire court file, little or no evidence was given as to why this was in the interests of justice or whether a less restrictive order could be made.

[92] Accordingly, the two current sealing orders will remain in place, but the motion to otherwise seal the entire file is dismissed. This issue can be revisited in the action if either party can present evidence in support of it.

Conclusion

[93] This is not simply a dispute regarding the accounting of moneys. The employment of many individuals and the education of students lie in the balance. This matter needs to be resolved on a timely basis. While the parties have not opted for arbitration, I urge them to reconsider that avenue so that these issues can be adjudicated in a timelier way, and on terms that will facilitate the multi-jurisdictional nature of this dispute.

[94] For the reasons set forth herein, I make the following orders:

(a) unless otherwise varied herein, the Order of February 1, 2019 remains in force;

(b) BDO is appointed as a Monitor, an officer of this court, to monitor the business operations and financial affairs of MEERC Inc., the Medical Education Examination Resource Centre, All Saints University Limited, All Saints University School of Medicine Limited and the American University of St. Vincent (collectively the "Corporate respondents");

(c) for the purposes of any Order made on this day, any monitoring or investigation with respect to the American University of St. Vincent shall commence only from the date that the respondent Joshua Akanni Yusuf acquired any degree of ownership, management or control of the American University of St. Vincent;

(d) the Applicants, Yusuf and the Corporate respondents shall forthwith provide the necessary written direction or authorizations that permit the Monitor to speak to the people the Monitor requires, obtain information or documentation from third parties that it requires, or take any action that is required to facilitate the Monitor in completing its mandate in a timely and efficient manner in Ontario, Dominica and St. Vincent and the Grenadines; [page259]

(e) the Monitor is hereby directed and empowered to monitor the business operations and financial affairs of the Corporate respondents, including the power to

(1) have full and complete access to the books, records, data, including data in electronic form, and other financial documents of the Corporate respondents to the extent that is necessary to adequately assess the Corporate respondents' business and financial affairs or to perform its duties arising under this Order;

(2) have full and direct access to banking and accounting systems of the Corporate respondents electronically over the Internet;

(3) make inquiries of the existence of any property owned by or that ought to be owned by the Corporate respondents, including the location of the property, and to have immediate and continued access to this property and require the delivery of all such property to the Monitor upon the Monitor's request;

(4) make inquiries into the past business practices of the Corporate respondents, subject to subpara. 94(c);

(5) facilitate payment of operating expenses for the Corporate respondents on just and equitable terms and consistent with past practices, which includes any expenses for advertising or marketing;

(6) audit the current and historical books and records of the Corporate respondents, subject to subpara. 94(c);

(7) compel the production of documents from third parties;

(8) report to the parties and the court on the Monitor's findings;

(9) report or apply to this court as the Monitor may deem appropriate with respect to the matters relating to the business of the Corporate respondents, compliance with any Orders issued by this court, and such other Matters as may be relevant to the proceedings here; and

(10) take any steps reasonable incidental to the exercise of the Monitor's powers and duties, or the performance of any statutory obligations.

(f) All funds, moneys, cheques, instruments and other forms of payments received or collected by the Corporate respondents, [page260] prior, and subsequent, to this Order and by the Monitor, if any, from and after the making of this Order from any source whatsoever, including without limitation the sale of all or any of the assets or property of the Corporate respondents and the collection of any accounts receivable in whole or in part, whether in existence on the date of this Order or here-after coming into existence, shall be deposited into one or more new accounts to be opened by the Monitor (the "Post Order Accounts") and the moneys standing to the credit of such Post Order Accounts from time to time, net of any disbursements provided for herein for the continued operations of the Corporate respondents shall be held by the Monitor to be paid in accordance with the terms of this Order or any further Order of this court;

(g) the Monitor is hereby directed and empowered to determine the appropriate equalization payments as between the parties and to make said equalization payments upon the agreement of the parties or order of the court;

(h) the Monitor shall take no part whatsoever in the management of the business of the Corporate respondents and shall not, by fulfilling its obligations hereunder, be deemed to have taken or maintained possession or control of the business of the Corporate respondents;

(i) in addition to the rights and protections afforded to the Monitor herein, the Monitor shall incur no liability as a result of its appointment or the carrying out of the provisions of this Order, save and except for any gross negligence or willful misconduct on its part. Nothing in this Order shall derogate from the protections afforded to the Monitor as an officer of the court;

(j) the Applicants, Corporate respondents and Yusuf shall provide written instruction, direction and authorization to others who have notice of this order to forthwith advise the Monitor of all material steps taken by the Corporate respondents pursuant to this Order, and shall co-operate fully with the Monitor with the assistance that is necessary to enable the Monitor to adequately carry out the Monitor's functions;

(k) the Corporate respondents, the Applicants and Yusuf themselves shall provide written instruction, direction and authorization to others who have notice of this order to forthwith advise the Monitor of the existence of any books, documents, securities, contracts, orders, corporate and [page261] accounting records, and any other papers, records and information of any kind related to the business or affairs of the Corporate respondents, and any computer programmes, computer tapes, computer disks, or other data storage media containing any such information (the foregoing, collectively, the "Records") in that person's possession or control, and shall provide to the Monitor or permit the Monitor to make, retain and take away copies thereof and grant to the Monitor unfettered access to and use of accounting, computer, software and physical facilities relating thereto, provided however that nothing in this paragraph or the preceding paragraph shall require the delivery of the Records, or the granting of access to Records, which may not be disclosed or provided to the Monitor due to the privilege attaching to solicitor-client communication or due to statutory provisions prohibiting such disclosure;

(l) if any of the Records are stored or otherwise contained on a computer or other electronic system of information storage, whether by independent service provider or otherwise, the Applicants, Yusuf and Corporate respondents shall authorize or direct all persons in possession or control of such Records to forthwith give unfettered access to the Monitor for the purpose of allowing the Monitor to recover and fully copy all of the information contained therein whether by way of printing the information onto paper or making copies of computer disks or such other manner of retrieving and copying the information as the Monitor in its discretion deems expedient, and shall not alter, erase or destroy any Records without the prior written consent of the court. Further, for the purposes of this paragraph, the Corporate respondents, Yusuf, the Applicants or any of those persons so authorized in writing by the aforementioned, shall provide the Monitor with all such assistance in gaining immediate access to the information in the Records as the Monitor may in its discretion require, including providing the Monitor with instructions on the use of any computer or other system and providing the Monitor with any and all access codes, account names and account numbers that may be required to gain access to the information;

(m) the Monitor and counsel to the Monitor shall be paid their reasonable fees and disbursements, in each case at their standard rates and charges unless otherwise ordered by the court on the passing of accounts, and the Monitor and counsel to the Monitor shall be entitled to and are [page262] hereby granted a charge (the "Monitor's Charge") on the assets of the Corporate respondents as security for such fees and disbursements, both before and after the making of this Order in respect of these proceedings, and that the Monitor's Charge shall form a first charge on the assets of the Corporate respondents in priority to all security interests, trusts, liens, charges and encumbrances, statutory or otherwise;

(n) the Applicants and respondents shall forthwith authorize the release of $500,000 to the Monitor as a retainer for their services, or any other sum as agreed by the parties, to be replenished as required, which sum shall be paid from the funds of the partnership;

(o) the Monitor and its legal counsel shall pass its accounts from time to time, and for this purpose the accounts of the Monitor and its legal counsel are hereby referred to a Judge of the Ontario Superior Court of Justice, or master;

(p) the parties shall immediately authorize the release of $1 million dollars from the partnership funds to the Applicants for the purpose of operating ASU SVG; the Applicants shall provide a full accounting of these funds to the Monitor; this payment shall be considered an advance on any sum found to be payable to the Applicants;

(q) any further release of interim funds shall be at the sole discretion of the Monitor;

(r) on a without prejudice basis, Yusuf is hereby restrained from, either individually or in partnership or jointly or in conjunction with any person or persons, as principal, agent or shareholder, or in any manner whatsoever, carrying on or being engaged in or concerned with or interested in, or managing, advising, lending money to, guaranteeing the debts of or obligations of, or permitting his name or any part thereof to be used or employed or associated with any company or any of their parents, subsidiaries, affiliates or associated companies who carry on the business of providing medical education in St. Vincent and the Grenadines, except with respect to the American University of St. Vincent;

(s) with respect to the American University of St. Vincent, Yusuf is restrained from further employing or otherwise engaging the services of individuals who have worked for ASU SVG anytime in the previous 12 months, unless they are so employed or engaged as of the date of this order, or from further enrolling or otherwise participating in the [page263] education of any student who had previously been enrolled with ASU SVG in the previous 12 months, unless they are so enrolled as of the date of this order, except by agreement between the parties or by further court order; this order is made without prejudice to any claim the Applicants may have in the action with respect to this alleged improper competition or alleged breach of fiduciary duty;

(t) this application is converted into an action;

(u) the applicants shall be the plaintiffs and the respondents shall be the defendants;

(v) the plaintiffs shall deliver a statement of claim within 30 days from today's date;

(w) the plaintiffs have leave to add the American University of St. Vincent and related individuals as defendants in these proceedings;

(x) the Affidavit of Joshua Akanni Yusuf, entitled "Confidential, Subject to Sealing Order" dated April 18, 2019 shall remain sealed;

(y) the Affidavit of Maneharran Paulpillai, entitled "Confidential -- Subject to Sealing Order", dated April 24, 2019, shall remain sealed;

(z) the motion to seal the entire court file is otherwise dismissed, without prejudice to either party seeking a similar order in the action;

(aa) with the exception of costs, I am no longer seized of this matter;

(bb) the parties are encouraged to resolve the issue of costs themselves. If they are unable to do so, both parties are to provide their written costs submissions, double spaced, single sided, limited to two pages, exclusive of costs outline and case law, to be served and filed no later than February 28, 2020; responding submissions, with the same size restrictions, shall be served and filed no later than March 20, 2020; if submissions are not received by both parties on or before February 28, 2020, costs will be reserved to the trial judge.

Application allowed in part.

End of Document