Court File and Parties

COURT FILE NO.: CV-22-680467

DATE: 20220927

ONTARIO SUPERIOR COURT OF JUSTICE

RE: The Estate of William Robert Waters, by his Estate Trustees Lindsay Histrop and Agnes Kussinger, plaintiff

-and-

Gillian Henry, Noelle Henry, Matthew Alexzander Henry, Donna McGrath, Cedric Noel Butters, Jean Elaine Butters, Michelle Amanda Lloyd, Shamile Lloyd, Richard Anthony Lloyd, 2325587 Ontario Limited, 2329223 Ontario Limited, 7222874 Canada Inc., King of Hearts Stables Ltd., John Doe #1, Jane Doe #1, John Doe #2, Jane Doe #2, And John Doe Corp., defendants

BEFORE: Robert Centa J.

COUNSEL: Lorne Silver and Jonathan Shepherd, for the plaintiff

Arie Gaertner and William Levitt, for certain defendants

HEARD: August 31, 2022

ENDORSEMENT

[1] On May 4, 2009, the defendant Gillian Henry began to work as a personal services worker for Phyllis Waters. The parties dispute whether or not Ms. Henry also provided services to Phyllis’s husband, Dr. William Waters, who paid Ms. Henry $2,500 every two weeks.

[2] By June 2, 2009, Dr. Waters had paid Ms. Henry $5,000 in fees for service. In addition, Dr. Waters had also transferred over $500,000 to her. By the end of 2009, this number had climbed to over $3 million. By December 3, 2019, Dr. Waters had made some 390 transfers to Ms. Henry totalling more than $29.4 million.

[3] Ms. Henry stopped providing services to Mrs. Waters in December 2019. That also appears to be when Dr. Waters stopped making very large transfers to Ms. Henry.

[4] Dr. Waters’ health began to deteriorate more rapidly and on May 4, 2020, the powers of attorney for personal care and management of property were exercised. Agnes Kussinger was named as co-attorney. In January 2021, Ms. Kussinger spoke to Dr. Waters about debts that might be owed to him. On February 15, 2021, Ms. Kussinger spoke with Ms. Henry about documentation of certain debts that Ms. Henry appeared to owe to Dr. Waters. Shortly after that call, Ms. Henry started selling and mortgaging properties and transferring money to her family members.

[5] Dr. Waters died on July 28, 2021, at the age of 88. His estate trustees, Lindsay Histrop and Ms. Kussinger, began the complicated process of winding up Dr. Waters’ financial affairs. Much to their surprise, they learned that Dr. Waters’ bank accounts contained only $535,000. The ongoing care for Mrs. Waters cost, at a minimum, $35,000 per month.

[6] On April 29, 2022, the plaintiff issued a notice of action in this proceeding. On June 7, 2022, Myers J. signed an ex parte Mareva order. The order froze the worldwide assets of Ms. Henry, 2325587 Ontario Limited, 2329223 Ontario Limited, 7222874 Canada Inc., and King of Hearts Stables Ltd. (the “Henry defendants”). The order also imposed certificates of pending litigation on a number of properties in which the plaintiff claimed an interest. This order has been amended and extended on a number of occasions.[^1]

[7] The Henry defendants now move to set aside the Mareva order on two grounds. First, they submit that the plaintiff failed to make full and frank disclosure of material facts on the ex parte motion before Myers J. Second, the Henry defendants submit that, with the benefit of Ms. Henry’s evidence and submissions, the plaintiff does not meet the test to obtain a Mareva order and, therefore, it should not be continued.

[8] I disagree. The plaintiff made full and frank disclosure of the evidence in its possession. The plaintiff did not seek to obtain an unfair advantage through improper means. In my view, any concerns about the material placed before Myers J. are minor and do not justify setting aside the order.

[9] Reviewing all the evidence placed before me, and considering the matter de novo, I am satisfied that the injunction should remain in place until trial. The plaintiff has presented a strong prima facie case that some or all of the funds transferred to Ms. Henry are impressed with a resulting trust, that Ms. Henry has been unjustly enriched by receipt of the funds, that Ms. Henry obtained the transfers through civil fraud, the exercise of undue influence, or in breach of a fiduciary duty owed to Dr. Waters.

[10] While it will be for the trial judge to make final determinations of what happened, Ms. Henry’s evidence does not make me doubt the strength of the plaintiff’s case. Her evidence about her intimate relationship with Dr. Waters is uncorroborated. The documents she references do not provide clear evidence, much less clear and contemporaneous evidence that Dr. Waters gifted her the vast majority of the money she received. She has raised doubts about her credibility by breaching the Mareva injunction, admitting that she knowingly filed documents containing false statements in a prior court proceeding, and tendering documents that may well have been altered.

[11] I find that there is a significant risk that the Henry defendants will dissipate their assets in advance of trial and that injunctive relief is appropriate. Stepping back, $27 to $29 million has changed hands in highly unusual circumstances. It will take a lengthy and complicated trial to sort out exactly what happened. It is entirely possible that some of the 390 transfers will be found at the end of trial to represent gifts to Ms. Henry. However, on this record, I am satisfied that the plaintiffs have presented a strong prima facie case with respect to the overwhelming majority of the $29 million that changed hands. It is in the interests of justice that the assets of the Henry defendants be frozen until trial so that they may be available to satisfy any judgment that is rendered in favour of the plaintiff.

Plaintiff’s motion to strike Ms. Henry’s affidavit

[12] On July 20, 2022, Ms. Henry swore a 28-page, 104-paragraph affidavit for use on this motion. The plaintiff brought a motion to strike out the affidavit in its entirety, or, in the alternative, to strike out 38 paragraphs from the affidavit.

[13] Most importantly, the plaintiffs move to strike out 27 paragraphs of the affidavit on the basis that they are inadmissible as contrary to s. 13 of the Evidence Act, R.S.O. 1990, c. E.23. I disagree.

[14] Section 13 of the Evidence Act provides that:

In an action by or against the heirs, next of kin, executors, administrators or assigns of a deceased person, an opposite or interested party shall not obtain a verdict, judgment or decision on his or her own evidence in respect of any matter occurring before the death of the deceased person, unless such evidence is corroborated by some other material evidence.

[15] Section 13 of the Evidence Act displaces the general rule that the testimony of a single witness, if believed to the requisite degree of certainty, is a sufficient basis for decision in a civil case: Radford v. MacDonald (1891), 18 O.A.R. 159 (C.A.), at p. 171; R. v. Khela, 2009 SCC 4, [2009] 1 S.C.R. 104, at para. 2; R. v. Vetrovec, 1982 CanLII 20 (SCC), [1982] 1 S.C.R. 811, at pp. 819-20.

[16] At one time, persons with an interest in a matter were completely prohibited from testifying. Statutes have eroded this common law rule. For example, in Ontario, s. 7 of the Evidence Act provides that “Every person offered as a witness shall be admitted to give evidence although he or she has an interest in the matter in question or in the event of the action and although he or she has been previously convicted of a crime or offence.”

[17] Although persons with an interest can now testify, an enduring suspicion has remained where an interested person testifies in an action involving a deceased person. Justice Laskin succinctly described “the obvious disadvantage faced by the dead: they cannot tell their side of the story or respond to the living’s version of events”: Burns Estate v. Mellon (2000), 2000 CanLII 5739 (ON CA), 48 O.R. (3d) 641 (C.A.), at para. 5.

[18] To respond to this concern, the Legislature made corroboration of a witness mandatory in circumstances where s. 13 of the Evidence Act applies. This rule requires additional evidence beyond that of an interested party, who is deemed to be a potentially unreliable witness.

[19] Section 13 applies to this action because it is an action by the executors of a deceased person. Ms. Henry is clearly an opposite or interested party in this action. Ms. Henry, therefore, shall not obtain a judgment or decision on her own evidence in respect of any matter occurring before the death of Dr. Waters, unless such evidence is corroborated by some other material evidence. Section 13 requires evidence independent of the evidence of Ms. Henry that shows that her evidence is true. The corroborating evidence can be a single piece of evidence, or several pieces considered cumulatively: Burns Estate, at para. 29; Paquette v. Chubb (1988), 1988 CanLII 4621 (ON CA), 65 O.R. (2d) 321 (C.A.), approving Sands Estate v. Sonnwald (1986), 22 E.T.R. 282 (Ont. H.C.).

[20] I disagree with the plaintiff’s submission that Ms. Henry’s evidence is inadmissible absent corroboration. In my view, that interpretation is contrary to the modern principle of statutory interpretation, which holds that the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of the Legislature: Barker v. Barker, 2022 ONCA 567, 84 C.C.L.T. (4th) 1, at para. 207; Bell ExpressVu Limited Partnership v. Rex, 2002 SCC 42, [2002] 2 S.C.R. 559, at para. 26. The modern principle takes a holistic view of legislation and recognizes that statutory interpretation cannot be founded on the wording of the legislation alone but must have regard to legislative intent, textual meaning, and legal norms: Rooney v. ArcelorMittal S.A., 2016 ONCA 630, 133 O.R. (3d) 287, at paras. 10-14.

[21] First, s. 13 must be read in harmony with s. 7, which makes clear that Ms. Henry’s evidence is admissible, despite her being an interested person. I do not see anything in the text of s. 13 that derogates from imperative direction “shall be admitted” found in s. 7.

[22] Second, when the Evidence Act addresses the admissibility or inadmissibility of evidence, it does so directly and uses those specific words to express its intent: ss. 5, 7, 32, 34, 34.1, 35, 39, 44, 45, 47, 48, and 52. Given the frequency with which the Legislature used the words admissible and inadmissible in the Act, I do not see anything in the scheme or object of the Act that persuades me that I should interpret s. 13 as affecting the admissibility of Ms. Henry’s evidence where the section does not use those words.

[23] Third, interpreting s. 13 as affecting the admissibility of the evidence would create significant problems at trial. If Ms. Henry gave this evidence from the witness box, an objection to its admissibility on the basis of the absence of corroboration would have to be made as she answered the question. The corroborating evidence, however, may not yet have been tendered, either from a subsequent witness or subsequent documents. This unwieldly situation should be avoided unless the language of s. 13 compels it.

[24] I recognize that some cases have described uncorroborated evidence from an adverse party about matters occurring before the death of the testator as inadmissible: Orfus Estate v. Samuel and Bessie Orfus Family Foundation, 2011 ONSC 3043, 71 E.T.R. (3d) 210, aff’d 2013 ONCA 225, 304 O.A.C. 349. However, I think the better interpretation is to view s. 13 as requiring corroborating evidence before the court may grant judgment or make a decision in favour of an interested person on the basis of her own evidence about matters that took place before death.

[25] For this reason, I decline to strike out as inadmissible the 27 paragraphs of the affidavit that were challenged by the plaintiff on the basis of s. 13.

[26] The plaintiff also seeks to strike certain other paragraphs of Ms. Henry’s affidavit on the basis that they contain opinion or do not properly state the source of her information and belief. I do not think it is necessary to do so. It is true that some of the paragraphs contain opinions or statements that do not clearly state the source of Ms. Henry’s information and belief. I will simply discount the weight to be assigned to those paragraphs, several of which are immaterial to the matters raised on this motion.

Overview of the positions of the parties

[27] I will summarize briefly the evidence relied on by both parties and explain their theories of the case before considering in detail whether or not the plaintiff made full and frank disclosure to Myers J. and whether or not the injunction should be set aside.

[28] The CaseLines file on this motion exceeded 8,000 pages. There are significant factual disputes between the parties. On this motion, I am not required to make final determinations about what happened. It will be for the trial judge to decide on a balance of probabilities whether or not the plaintiff makes out its allegations.

[29] The plaintiff filed extensive evidence before Myers J. and on this motion. The plaintiff filed a 55-page affidavit from Ms. Kussinger, sworn May 30, 2022. The affidavit attached 192 exhibits and four schedules. Schedule A contained a chronology and described approximately 40 key exhibits. Schedules B and C contained summaries of the transfers from Dr. Waters to Ms. Henry. Schedule D contained a chronological list of the land transactions at issue from March 4, 2011, to January 7, 2022. The plaintiff also filed a supplementary 10-page affidavit of Ms. Kussinger, sworn July 27, 2022. The supplementary affidavit attached a further 18 exhibits.

[30] The Henry defendants filed a 29-page affidavit from Ms. Henry, sworn July 20, 2022, which attached 14 exhibits, a two-page affidavit from Ms. Henry, sworn on August 2, 2022, an eight-page affidavit from Ms. Henry, sworn on July 15, 2022, and a two-page affidavit from Jean Butters, sworn on July 8, 2022.

[31] The parties also filed transcripts of the cross-examinations of Ms. Kussinger and Ms. Henry, the rule 39.03 examinations of Meredith Brown, Ian Hawkins, and Jeff Brown, 1100 pages of answers to undertakings.

Plaintiff’s evidence

[32] Dr. Waters earned his Ph.D. in economics and finance from the University of Chicago. In 1962, he joined the faculty of the University of Toronto, where he taught until his retirement. In 1968, he married Phyllis. They had no children and Dr. Waters had no siblings. Dr. Waters developed and sold two very successful businesses, Financial Models Inc. and Portfolio Analytics. These two ventures provided him with the bulk of his wealth.

[33] The plaintiff states that in May 2009, Dr. Waters hired Ms. Henry as a personal support worker (“PSW”) for both Dr. Waters and Mrs. Waters. By this time, Mrs. Waters suffered mightily with chronic pain and become reclusive, seldom leaving her room. The plaintiff points to correspondence from Dr. Waters in which he commends Ms. Henry and states that “[w]e were very impressed with [Ms.] Henry’s caring attitude, efficiency and care to both of us” and text messages in which Ms. Henry describes showering Dr. Waters and paying attention to his dialysis port. It is undisputed that she provided significant companionship to Dr. Waters during her employment. Although the invoices from Ms. Henry’s company indicated that the services were provided to Mrs. Waters only, that was because Dr. Waters could deduct the fees from the PSW services for Mrs. Waters from taxes because she was disabled. Dr. Waters paid Ms. Henry approximately $83,600 per year toward the end of her employment.

[34] Dr. Waters died on July 28, 2021. Mrs. Waters survived him, and she continued to require support and care that cost in excess of $35,000 per month. The estate trustees for Dr. Waters began to piece together the estate’s finances. They concluded that Dr. Waters had transferred at least $29.4 million to Ms. Henry between May 2009 and December 2019. This represented almost the entirety of his estate and likely left insufficient funds to care for Mrs. Waters for the balance of her life.

[35] The plaintiff submits that Dr. Waters provided the overwhelming majority of these transfers to Ms. Henry as “capital investment to establish real estate holding companies which would own property and receive corresponding profits ultimately for his and his estate’s benefit.” Dr. Waters understood that he would be the majority shareholder in several numbered companies that would own real estate assets that would both generate rental income and appreciate in value to his benefit. The plaintiff points to a series of emails and handwritten notes that it says support this characterization of the transfers.

[36] The plaintiff places significant reliance on evidence of Dr. Waters testamentary intentions, including that he signed a secondary will in 2018, which provided that Ms. Henry would receive some shares from his estate “provided she pays to my estate the assets she holds for me on resulting trust.”

[37] The plaintiff submits that the evidence shows that Ms. Henry defeated this intention. She used only $12 million of the funds provided by Dr. Waters to purchase 17 properties. Some but not all of these purchases were supported by loan agreements in the amount of $2.8 million. She did not make Dr. Waters a shareholder or director of the numbered corporations. She used some of the transferred funds to support an extravagant lifestyle or to make private loans and gifts to her family and friends.

[38] Ms. Henry has returned approximately $1.7 million of the funds she received to Dr. Waters or to the estate. On February 15, 2021, Ms. Kussinger spoke by telephone to Ms. Henry regarding documentation related to the debts owing to the estate. Ms. Henry stated that she owed the estate about $1 million. Shortly thereafter, Ms. Henry sold six properties that she owned, listed one asset for sale at a much lower price than it had been listed at four months earlier, and encumbered four more properties. The plaintiff points to this as evidence that Ms. Henry knew that the estate was on to her and began to dissipate her assets to prevent recovery.

Henry defendants’ evidence

[39] Ms. Henry states that she only provided care and support to Mrs. Waters never to Dr. Waters. She relies on the invoices from her company that only mention Mrs. Waters as the client.

[40] Ms. Henry states that “Dr. Waters developed an intimate relationship with [her],” and that they had “conjugal contact.” She states that they were to be married after Mrs. Waters died, and that Dr. Waters had given her a diamond ring to symbolize their “union.” Because of this relationship, Dr. Waters gave Ms. Henry $29.4 million dollars for her own uses, which included acquiring and improving property in her own name, travel, educational expenses, and gifts to her family. Dr. Waters wanted her to become financially independent, to make money in the market, and for her to have nice things.

[41] Ms. Henry states that at no time did Dr. Waters give her money to invest for the benefit of his estate. She says that it would make no sense for Dr. Waters, a retired professor of economics and finance, to entrust Ms. Henry, who had only a grade 11 education, to set up a multimillion-dollar business venture. She points to certain handwritten notes and documents that she says support her version of events. She maintains that she owed only about $1.4 million to the estate and has now repaid almost all of that amount.

[42] I am mindful that some of Ms. Henry’s evidence, particularly her intimate relationship with Dr. Waters, is not corroborated by any independent evidence.

Full and frank disclosure

Legal principles

[43] The plaintiff moved ex parte for injunctive relief and was required to make full and fair disclosure of all material facts. The failure to do so is in itself sufficient ground for setting aside the order: rule 39.01(6), Rules of Civil Procedure, R.R.O. 1990, Reg. 194. A party moving ex parte must be fair: Moses v. Metro Hardware and Maintenance Inc., 2020 ONSC 6684, at para. 26, leave to appeal denied, 2021 ONSC 877 (Div. Ct.). In United States v. Friedland, [1996] O.J. No. 4399 (Gen. Div.), at paras. 27-28, Sharpe J. (as he then was) described the duty on a party moving ex parte as follows:

That party is not entitled to present only its side of the case in the best possible light, as it would if the other side were present. Rather, it is incumbent on the moving party to make a balanced presentation of the facts [and] law. The moving party must state its own case fairly and must inform the Court of any points of fact or law known to it which favour the other side. The duty of full and frank disclosure is required to mitigate the obvious risk of injustice inherent in any situation where a Judge is asked to grant an order without hearing from the other side.

If the party seeking ex parte relief fails to abide by this duty to make full and frank disclosure by omitting or misrepresenting material facts, the opposite party is entitled to have the injunction set aside. That is the price the Plaintiff must pay for failure to live up to the duty imposed by the law. Were it otherwise, the duty would be empty and the law would be powerless to protect the absent party.

[44] The moving party is under a duty to place before the court all material facts that, viewed objectively, are relevant to the court's assessment of the motion. All matters which are relevant to the 'weighing operation' that the court has to make in deciding whether or not to grant the order must be disclosed.

[45] However, the duty of full and frank disclosure is not to be imposed in a formal or mechanical manner. Motions brought ex parte are almost always brought quickly and with little time for the preparation of material. The moving party should not be deprived of a remedy because there are “mere imperfections in the affidavit or because inconsequential facts have not been disclosed”: Friedland, at para. 31; Two-Tyme Recycling Inc. v. Woods, 2009 CanLII 64803 (Ont. S.C.), at para. 21.

[46] The rules regarding non-disclosure should not be interpreted too strictly as it might encourage unscrupulous defendants to allege material non-disclosure when they have a hopeless case on the merits: Univalor Trust S.A. v. Link Resource Partners Inc., 2012 ONSC 6034, 42 C.P.C. (7th) 149, at para. 5; Two-Tyme, at para. 44. Prior cases teach that some latitude must be given to the moving party and the defects complained of must be relevant and material to the discretion to be exercised by the Court: Friedland, at para. 31; Mooney v. Orr (1994), 1994 CanLII 1779 (BC SC), 100 B.C.L.R. (2d) 335 (S.C.); Rust Check Canada Inc. v. Buchowski (1994), 1994 CanLII 7416 (ON SC), 58 C.P.R. (3d) 324 (Ont. Gen. Div.).

[47] The test on whether to set aside an ex parte order for non-disclosure of material facts is whether the omitted disclosure might have had an impact on the original order being made: Hazelton Homes Corporation v. Mehta, 2020 ONSC 849, 63 E.T.R. (4th) 147, at para. 21; Two-Tyme, at para. 20; United States v. Yemec (2003), 2003 CanLII 23436 (ON SC), 67 O.R. (3d) 394 (S.C.), at para. 35; Wachsmann v. Zahler, 2002 CarswellOnt 3594 (S.C.), at para. 8. In a case where the Court finds that such a matter of non-disclosure was not material, it may decline to vacate the injunction: see, for example, Alberta (Securities Commission) v. Maitland Capital Ltd., 2008 CarswellOnt 4141 (S.C.).

Documents that the Henry defendants submit were not disclosed

[48] I find that the Henry documents did not breach their obligation of full disclosure by failing to put material documents before the court. Ms. Kussinger’s unchallenged evidence is that she included “all signed and unsigned documentation relating to the transfer of funds between [Dr.] Waters and [Ms.] Henry found in the boxes of [Dr.] Waters’ files” in her original affidavit. That effort goes a long way to satisfying me that the plaintiff did not fail to disclose material facts. I will consider each of the specific issues raised by the Henry defendants in turn.

Exhibits 8 and 9 to Ms. Henry’s affidavit

[49] The Henry defendants submit that the plaintiff should have disclosed two documents that are attached to Ms. Henry’s affidavit as exhibits 8 and 9. The first is a handwritten note dated April 8, 2014, from Dr. Waters to Ian Hawkins regarding Ms. Henry’s tax return, with attachments. The second is a handwritten note dated April 11, 2014, from Dr. Waters to Mr. Hawkins regarding Ms. Henry’s taxes.

[50] The Henry defendants describe these notes as instructions from Dr. Waters to Mr. Hawkins, who was both Dr. Waters’ own financial advisor and also assisted with the preparation of tax returns for Ms. Henry. The Henry defendants submit that these notes indicate that Dr. Waters instructed Mr. Hawkins to attribute to Ms. Henry the rental income from certain properties purchased with funds from Dr. Waters. They submit that this is evidence that Dr. Waters considered the properties to be owned legally and beneficially by Ms. Henry and that the plaintiff should have put this evidence should have before Myers J.

[51] The plaintiff points out that these documents were in Ms. Henry’s possession, not in the possession of the plaintiff. Indeed, Ms. Henry states in her affidavit, with respect to Exhibit 9, that “Mr. Waters gave me this document.”

[52] There is no evidence before me that suggests that the plaintiff had copies of Exhibit 8 or 9 at the time Ms. Kussinger swore her affidavit on May 30, 2022. Failing to put documents one does not possess before the court can not violate the duty to make full and frank disclosure.

Ms. Henry’s tax returns for 2009 to 2013

[53] The Henry defendants submit that the plaintiff had access to Ms. Henry’s tax returns from 2009 to 2013 and should have placed them before Myers J. In her affidavit, Ms. Henry stated that her tax returns were in the possession of Dr. Waters and Mr. Hawkins. She included her 2013 tax return as an exhibit to her affidavit. She did not include any of her other tax returns in her affidavit.

[54] The plaintiff submits that they included with Ms. Kussinger’s affidavit all of Dr. Waters’ notes and documents that related to Ms. Henry’s taxes. For example, exhibits 32 (a handwritten note dated October 10, 2010), 88 (a handwritten note dated February 23, 2010) and 89 (a handwritten note dated November 14, 2010, and updated January 16, 2011), all related to Ms. Henry’s taxes.

[55] Ms. Kussinger stated on cross-examination that she knew that Ms. Henry’s tax returns were in Dr. Waters’ office because they were labelled and because she knew that he had assisted Ms. Henry with them. Although she had access to Ms. Henry’s tax returns for the years 2009 to 2013, Ms. Kussinger believed those records were private and belonged to Ms. Henry, so she did not review them. Instead, she put them in a bag and delivered them to counsel for the plaintiff.

[56] Counsel for the plaintiff also did not review Ms. Henry’s tax returns. Counsel for the plaintiff offered to provide the 2009 to 2013 tax information to counsel for the Henry defendants for their review but counsel for the Henry defendants did not ask for them. I infer that if Ms. Henry needed copies of her tax returns or thought that there was anything material or helpful to her in those tax returns, she would have obtained and relied on them.

[57] I do not fault the plaintiff for not including Ms. Henry’s tax returns in the material it placed before Myers J. It is commonly accepted that tax returns contain highly personal and confidential information. The plaintiff could review Ms. Henry’s tax returns (because Ms. Kussinger had access to them) but that does not mean the plaintiff should review Ms. Henry’s tax returns. Ms. Kussinger did not have Ms. Henry’s permission to review the tax returns, much less to file them with the court and, thereby, make them part of the public record.

[58] Moreover, the plaintiff could not have lawfully obtained Ms. Henry’s tax returns from her tax preparer, Mr. Hawkins. Mr. Hawkins could not have released Ms. Henry’s tax returns to anyone without her authorization and doing so would have violated her expectations of privacy and, possibly, Mr. Hawkwins’ own professional obligations: Latina (Re), 2018 ABCPA 11.

[59] I find that the plaintiff did not violate the duty to make full and frank disclosure by not putting Ms. Henry’s 2009 to 2013 tax returns before Myers J.

Dr. Waters’ net worth statements

[60] The Henry defendants submit that the plaintiff should have placed Dr. Waters’ net worth statements before Myers J. In response to undertakings given during cross-examination, the plaintiff produced the following:

a. a one-page handwritten statement of net worth as of December 31, 2010;

b. a one-page typed statement of net worth as of September 30, 2014;

c. eight pages of incomplete and undated schedules that were faxed on November 17, 2015;

d. eight pages of incomplete schedules dated November 2017

[61] The Henry defendants point out that these statements indicate that Dr. Waters:

a. Guaranteed a $1 million mortgage on a residential property owned by Ms. Henry in Aurora;

b. guaranteed a $0.9 million line of credit related to the Aurora property used on the King of Hearts Stables;

c. held a $400,000 mortgage on a property owned by Ms. Henry in Whitby.

[62] The Henry defendants highlight that the statements do not list any of the properties at issue as forming part of Dr. Waters’ assets, that he did not list any co-ventures with Ms. Henry under the heading, “Investments in Private Companies.”

[63] The plaintiff submits that these statements were not material to the ex parte motion. The plaintiff points out that Ms. Kussinger’s affidavit makes clear that Dr. Waters had transferred all his wealth to Ms. Henry and that numbered corporations were the legal owners of the properties. The plaintiff emphasizes that Ms. Henry never caused shares in the numbered companies to be issued to Dr. Waters, which explains why they would not be listed among his shareholdings.

[64] I agree with the plaintiff. I do not think these statements are material. I do not think there is any possibility that these statements might have affected the decision on the ex parte motion. First, it is not clear whether or not these statements that have been located are complete or if some or all of them are missing pages. Second, although the statements assign dollar values to some amounts, I do not think they are inconsistent with the evidence presented in Ms. Kussinger’s affidavit. Ms. Kussinger’s affidavit clearly sets out that Ms. Henry owed Dr. Waters a $900,000 loan and that there was an overdue mortgage receivable from Ms. Henry of $400,000. She disclosed that there were security agreements, promissory notes, and mortgages signed in respect of certain properties that were owned by Ms. Henry.

[65] Third, the net worth statements do not answer the fundamental thrust of the plaintiff’s case: that Dr. Waters transferred tens of millions of dollars to Ms. Henry, she used those funds for a variety of purposes for which he held a beneficial interest or over which there was a resulting trust. The net worth statements simply state the case in a different form. I think Ms. Kussinger’s affidavit fairly stated the information in the plaintiff’s possession, and I do not think the net worth statements are material or had any prospect of affecting the decision on the ex parte motion.

Email exchange between the estate trustees, February 17 and 18, 2021, and evidence of gifts

[66] The Henry defendants submit that the plaintiff should have disclosed an email exchange between Ms. Kussinger and Ms. Brown on February 17 and 18, 2021. The Henry defendants submit that Ms. Kussinger knew about gifts that Dr. Waters had made to Ms. Henry and that this should have been put before the court on the ex parte motion. Ms. Kussinger’s email states as follows:

Update on [Dr. Waters] finances ... I've been pressing him on that for quite a while now, and he's been procrastinating forever, so I finally put my foot down and I have his blessing to act on some things. Hence my phone call to Gillian. So Gillian thinks that she owes [Dr. Waters] $1 million and that there is some legal paper that he has that says so -- she can't find her copy of that document. Needless to say, he can't find it either. Hoping that the next time you go and visit him you'll have better luck.

I pointed out that he gave Gillian a lot more than a million, and if she repays what she think[s] she owes it won't be enough to take care of Phyllis in her old age. That gave him a bit of a pause.

Do you have an actual record of how much money went to her and when? I wouldn't worry about including VISA charges or gifts or tfsa/education fund amounts, just the steady monthly amounts that went out for what I am assuming was to pay her mortgages. I have some of it totalled up (over $17M) that went out of the brokerage accounts.

I am also going to have to come up with a budget of what Phyllis needs. And I am working on reducing the 24-hour care (cc'd you on message to Norma Jean). If you have any other ideas please let me know.

[67] The Henry defendants also challenge Ms. Kussinger’s statement in paragraph 7 of her affidavit that “for the vast majority of these wealth transfer transactions, I have been unable to located [sic] any documentation that these transactions were gifts.” The Henry defendants submit that the plaintiffs were required to place any evidence of gifts before the court.

[68] I do not believe the failure to provide this email exchange to the court on the ex parte motion is a material non-disclosure given the other information the plaintiff put before the court. In paragraph 70 of her affidavit, Ms. Kussinger stated that she understood that Dr. Waters provided Ms. Henry with a VISA charge card for her to use from 2009 to 2020. Over that time, Dr. Waters paid for $2.5 million in charges to that account. Ms. Kussinger stated that she reviewed the transactions and concluded that a large majority of the purchases were for the personal benefit of Ms. Henry, her businesses, and her immediate family. Ms. Kussinger attached to her affidavit account statements dated December 27, 2014, and December 27, 2015. These statements showed two months of detailed transactions and summaries of the year-to-date spending categories to provide examples of how Ms. Henry used the VISA card. In my view, this is more than sufficient disclosure of the fact that Dr. Waters paid for personal items for Ms. Henry and that her credit card expenses were large.

[69] In addition, the plaintiff highlighted in paragraphs 13 and 27 of its factum on the ex parte motion that Dr. Waters wrote that he provided “gifts of appreciation” to Ms. Henry. As discussed below, gratuitous transfers are presumed at law to be impressed with a resulting trust unless the recipient is able to prove otherwise: Pecore v. Pecore, 2007 SCC 17, [2007] 1 S.C.R. 795, at paras. 24 to 25; Public Guardian and Trustee v. Cherneyko et al, 2021 ONSC 107, 154 O.R. (3d) 388, at para. 27. In my view, there are no documents that conclusively demonstrate or even corroborate the suggestion that Dr. Waters transferred the bulk of the disputed funds as gifts: Pettenuzzo v. Charrette, 2011 ONSC 7126, at para. 68. The concern about whether or not the transfers were valid as gifts increases, of course, as the amounts in dispute climb into the millions of dollars.

[70] I would not set the ex parte order aside on this basis.

Histrop’s notes from the preparation of the will

[71] The Henry defendants submit that the plaintiff should have included in its motion record Ms. Histrop’s notes from any meetings she had with Dr. Waters during the preparation of his 2018 will. They submit that she was his lawyer, and her notes could reveal information about Dr. Waters’ understanding of the transfers to Ms. Henry.

[72] The plaintiff submits that there was nothing inappropriate with not providing Ms. Histrop’s notes. First, those notes (if they exist), would be protected by solicitor-client privilege, which has not been waived. Second, the will itself is not being challenged in this litigation and there is no reason to produce the notes. Third, the defendants are speculating about what might be contained in the notes and that is insufficient to amount to material non-disclosure.

[73] I agree with the plaintiff. The Henry defendants provided no authority for the proposition that a party must waive solicitor-client communication privilege over documents if they bring an ex parte motion. They did not bring a motion before me to determine whether or not the privilege claim is valid or should be set aside. I have no idea whether or not the notes, even if produced, would contain any relevant information. In these circumstances, I would not set the ex parte order aside on this basis.

Conclusion

[74] I find that none of the Henry defendants’ complaints about non-disclosure of material facts, even considered cumulatively, justify setting aside the injunction: Friedland, at para. 31; Mooney; Rust Check. The plaintiff did a commendable job of placing the relevant and material facts before the court. I find that none of the omitted disclosure might have had an impact on the original order: Hazelton Homes, at para. 21; Two-Tyme, at para. 20; Yemec, at para. 35; Wachsmann, at para. 8.

[75] I decline to vacate the injunction on the basis of non-disclosure of material facts.

Failure to lay out the case that would favour the defendant

[76] The Henry defendants also allege that the plaintiff failed to present fairly their case on the ex parte motion. They make three interrelated submissions. First, the plaintiff failed to make appropriate inquiries before going to court. Second, even if it provided the relevant documents to the court, the plaintiff failed to highlight content in those documents that was helpful to the Henry defendants. Third, the plaintiff should not have proceeded ex parte. For the reasons that follow, I disagree with each of these submissions.

The alleged failure to make inquiries

[77] The Henry defendants allege that the plaintiff failed to make proper inquiries before bringing its ex parte motion. The Henry defendants allege that: first, the plaintiff should have asked Mr. Hawkins, who prepared Ms. Henry’s income tax returns from 2008 to 2013 for information about the properties she owned; second, the plaintiff should have asked Ms. Henry whether or not Dr. Waters gifted her the $27 million; and third Ms. Kussinger should have disclosed to the court that she never asked herself if Dr. Waters had gifted all the transferred money to Ms. Henry.

[78] I disagree. First, for the reasons set out above, Mr. Hawkins owed duties of confidentiality to Ms. Henry. He would not have been at liberty to discuss her tax returns or confidential financial information with anyone, for any reason, without Ms. Henry’s consent. The plaintiff was under no obligation to attempt to obtain information from him. Indeed, had the plaintiff obtained and relied on such information without Ms. Henry’s consent, I anticipate that this would have been raised to challenge the propriety of any injunction.

[79] In addition, I have reviewed the transcript of Mr. Hawkins’ rule 39.03 examination. It provides no assistance to the Henry defendants. He never spoke with Ms. Henry. He did not complete any tax returns for any corporation that was owned legally or beneficially by Ms. Henry. He was not aware that she owned corporations that owned properties purchased with money from Dr. Waters. He confirmed that if a corporation held property in trust for someone else, the rental income and the expenses would be claimed by the corporation, not the beneficial owner of the property. He never discussed Ms. Henry’s tax returns with Dr. Waters. He stated that Dr. Waters never told him that he was buying property for Ms. Henry as a gift. He did not know whether or not Dr. Waters had transferred money to Ms. Henry as a gift or a loan. Indeed, the factum of the Henry defendants contains only one reference to the examination of Mr. Hawkins and that answer was later clarified on examination by the plaintiff. There is no reasonable chance that Mr. Hawkins would have provided evidence of assistance to Ms. Waters, even if the plaintiff could have obtained that information before going to court.

[80] Second, Ms. Kussinger called Ms. Henry and asked her about the amounts owing to Dr. Waters in 2021. Ms. Henry told her a much smaller number than Dr. Waters knew she owed to him. In light of that, there was no reason to follow up and inquire about gifts. Moreover, there is no reason to believe that the plaintiff would have accepted Ms. Henry’s assertion that Dr. Waters gave her gifts of $27 million. Ms. Henry has provided her version of events to the court and the plaintiff clearly does not accept any of her explanations. There is no reason to believe the plaintiff would have viewed this explanation as more credible earlier in the process.

[81] Third, I do not fault Ms. Kussinger for failing to ask herself if the $27 million in gratuitous transfers were gifts. Ms. Kussinger spoke with Dr. Waters who told her that Ms. Henry owed him much more than $1 million. Based on what she knew at the time, it implausible that Dr. Waters gave over $27 million to Ms. Henry as gifts. Nevertheless, Ms. Kussinger fairly put before the court the pieces of evidence that were in her possession that provided some evidence that some of the money may have been given to Ms. Henry.

Failure to highlight information that was before the court and helpful to the Henry defendants

[82] The Henry defendants submit that the plaintiff “failed to draw attention to several material documents buried in the record.” They submit that these documents provide “ample evidence” that Dr. Waters gifted over $29 million to Ms. Henry. The Henry defendants point to one paragraph of an email sent on September 10, 2015, from Mr. Hawkins to Dr. Waters (Exhibit 70), which referred to gifts to Ms. Henry, excerpts from exhibits 20, 25, 88, 90, 92, and 102 of the Kussinger affidavit, and certain documents that mention the creation of a foundation for Ms. Henry. I do not accept these submissions.

[83] First, Ms. Kussinger did highlight exhibits 20, 88, 90, 92, and 102 in Schedule A to her factum. She included a description of each handwritten note and a link directly to each of these exhibits. She explained as follows:

I attach to this affidavit as Schedule "A" a chart that reflects a number of handwritten notes of [Dr.]Waters that provide, in part, the rational for the transfers, estate planning considerations, a tracking of and Henry's receipt of certain wealth transfers, and in respect of the purchase, maintenance or sale of properties. The "Description" column in the chart is my best attempt to summarize the handwritten notes as accurately as possible. The underline emphasis in the description column is my own.

[84] Indeed, the summary of Exhibit 88 in Schedule A to Ms. Kussinger’s affidavit excerpts the very text that Ms. Henry pointed to in her submissions.

[85] I accept this as a fair attempt to highlight and summarize fairly the handwritten notes. I do not see this approach as unfair to Ms. Henry in any material way.

[86] Second, the plaintiff highlights Exhibit 25 in the body of Ms. Kussinger’s affidavit and provided the relevant excerpts:

I have also located a cover letter to the abovementioned Security Agreement that I have reason to believe was written by Waters (unsigned and undated). Attached and marked as Exhibit "25" is a copy of the cover letter and security agreement. Relevant excerpts of the cover letter are provided below:

[I am] presently 81 years of age and my wife Phyllis in 74. We are both in ill health. [ ... ]

[In all], I and my corporation have provided -- in addition to salaries and gifts of appreciation, -- $10,645,000 in loans in the expectation of her real estate and farm-based endeavours bearing fruit in due time. I also provide my professional expertise in the latter endeavour.

[I] have also provided my personal guarantee for the mortgage related to 9 Northern Dancer Lane, Aurora ON L4G 7Y7.

[87] At the time that Ms. Kussinger swore her affidavit, she did not have a copy of the signed letter and did not know its purpose. There was little more that she could say about the letter and, in my view, she excerpted the relevant parts directly into her affidavit. I do not agree with the Henry defendants’ characterization that Ms. Kussinger buried this exhibit. Ms. Henry later explained that this letter was prepared for use in her family law proceeding in 2014, although she maintains that it was inaccurate and that she knew it was inaccurate when she filed it with the court. I will address this point below.

[88] Third, Ms. Kussinger excerpted a portion of Exhibit 20 (Dr. Waters’ handwritten note dated January 14, 2011) in her affidavit. I do not see anything else in the note that could be expected to have affected the decision on the motion below.

[89] Although Ms. Kussinger did not describe Exhibit 70, the email dated October 9, 2015, from Mr. Hawkins to Dr. Waters, in her affidavit, it was not necessary to do so. In my view, Ms. Henry’s case would not have been improved by highlighting Mr. Hawkins’ email, which read:

Mrs. Henry and King of Hearts

1. Get a mortgage registered on title to protect what you have lent so far. You may have to be tough here. She has to realise that it is YOUR property not hers - until she pays for it. A title search is needed to check whether she has encumbered the property in the interim.

2.Early on I want a fix on structure. Who owns what. Who owns shares. Who has title to real estate. I want this from documents not verbally.

3. Document what has been spent where and on what (bookkeeping up to date.)

4. A list from you on what you have leant and when - (I assume it was all interest free??)

5. Initial report and clarify plan of attack

6. See financial statements and tax returns.

7. Review all buildings and structures, equipment and facilities.

8. Review with construction firm what they propose, time scale and cost.

9. Report on same

10. I also feel obliged to tell you that this has to stop. You have been exploited by this woman. There are thousands of caregivers out there who will work for a salary and do not drive high-end Mercedes SUVs. Do you know how much you have given to her over the years? Does she understand that this latest is a loan and not another in a series of gifts?

11. She cannot afford this property. She has overreached here. She cannot afford to buy it and she cannot afford the upkeep. Did she really not know that the financing condition was removed by the vendor? When she made her offer conditional on financing just who did she have in mind for provision of the funds?

12. I could save you my fees by stating at the outset that the property must be sold ASAP. All work must be stopped. Nothing more should be spent. She could get tenants in the residential portions to help pay such things as taxes. She must be focused on making you whole - whatever that takes.

[90] While it is true that paragraph 10 of this email contains a reference to gifts, I fail to see how highlighting this email would have helped Ms. Henry. I see this email as far more consistent with the plaintiff’s theory that the bulk of the transfers to Ms. Henry were not gifts than with Ms. Henry’s theory that they were. During his examination, Mr. Hawkins explained his email by saying that Ms. Henry “was obviously holding the property in trust for him until she paid for it. And she hadn’t paid for it. He had.” I am not sure how highlighting Mr. Hawkins’ view that Dr. Waters had “been exploited by this woman” would have helped Ms. Henry. The passing reference to gifts cannot be cherry-picked from what is otherwise a fairly devastating assessment of Ms. Henry’s motives and actions.

[91] Fourth, as noted above, Ms. Kussinger did highlight the VISA statements that Dr. Waters paid on behalf of Ms. Henry. The Henry defendants submit that this is evidence of donative intent that should have been placed before the court. I find that it was placed before the court and that it does not undermine the thrust of the plaintiff’s submissions about the balance of the $27 million.

[92] Fifth, Ms. Kussinger did put before the court documents and handwritten notes that indicate that Dr. Waters contemplated involvement in a foundation “created by [Ms. Henry] in honour of her parents” to support the education of her children and to alleviate family difficulties. The Henry defendants submit that this is clear evidence that Dr. Waters intended to gift money to Ms. Henry. I disagree. Most importantly, such a foundation was never created or funded. That significantly diminishes the weight that I would place on these notes. Even if there was a plan for Dr. Waters to make a gift to fund this foundation (and I think the notes are equivocal on the source of the funds), that intention is not transferrable to the money that actually was transferred to Ms. Henry to be invested in real property.

[93] Sixth, Dr. Waters and Ms. Henry did create the Noelle Henry Education Trust in June 2013. The trust property was $500,000 to be provided from the proceeds of sale of one of the properties purchased with funds that Dr. Waters provided to Ms. Henry in March 2014. Those funds had been provided pursuant to a promissory note signed by Ms. Henry, which Dr. Waters voided upon creation of the trust.

[94] I find that the plaintiff did highlight these documents sufficiently to bring them to the attention of the court and to put Ms. Henry’s case fairly on the ex parte motion. Ms. Kussinger described the documents clearly in paragraph 62 of her affidavit and exhibited them to her affidavit. Moreover, in paragraph 31 of the factum on the motion before Myers J., the plaintiff highlighted this evidence stating that Ms. Kussinger “candidly disclosed that there is documentation which suggests that there may be legitimate trusts or foundations established for [Ms.] Henry’s family.” This fairly put Ms. Henry’s case before the court. Nothing more was required.

[95] Similarly, Ms. Kussinger referenced in her affidavit documents that suggested that Dr. Waters knew that Ms. Henry was giving some money and benefits to her family. This was sufficient in the circumstances to fairly put that issue before the court. It is important to remember that all of the documents that suggest that Dr. Waters may have intended to give Ms. Henry or her family gifts cover only a small fraction of the total amount that Dr. Waters transferred to her.

[96] Seventh, Ms. Henry submits that the plaintiff should have highlighted that Dr. Waters had a security agreement dated May 7, 2014, in respect of a $1.4 million loan made as of April 2014. The agreement pledged three properties as security for the agreement. The Henry defendants submit that this agreement demonstrates that Dr. Waters did not own the properties beneficially and that this should have been highlighted for the court. First, Ms. Kussinger did put this agreement before the court. She described it accurately in paragraph 58 of her affidavit. Second, the plaintiff highlighted the security agreement in paragraphs 13, 27, and Appendix A to the factum filed on the ex parte motion. Third, I disagree with the submission that a security agreement is inconsistent with beneficial ownership. Dr. Waters may have wished to obtain additional protection and covenants through use of a security agreement. I do not think the two positions are irreconcilable.

The plaintiff proceeded ex parte

[97] The Henry defendants submit that the plaintiff should not have proceeded ex parte because there was no good reason to believe that the Henry defendants would, if given notice, act to frustrate the process of justice before the motion can be decided and there was time to provide notice to them: Komarnycky v. Laramee, 2012 ONSC 6503, at para. 22.

[98] I agree with the Henry defendants that it was possible for the plaintiff to give them notice of the motion. The plaintiff knew the identity of many of the defendants to the action and knew the addresses for some, if not all of them.

[99] I find, however, that there was good reason to believe the Henry defendants would act to frustrate the process of justice if they were given notice. For the reasons set out below, I find that there was evidence that Ms. Henry began to dissipate her assets after she spoke with Ms. Kussinger. In these circumstances, I find that it was appropriate, if risky due to the obligations attaching to an ex parte motion, for the plaintiff to proceed without notice to the Henry defendants.

Should the injunction be continued until trial?

[100] Pursuant to the original order, as extended, I am to consider de novo whether the injunction should be continued until trial. For the reasons that follow, I find that the plaintiff has met the test for injunctive relief. Looking at all of the evidence before me, I find that the plaintiff has established a strong prima facie case on several of the causes of action raised in the statement of claim. There is evidence that Ms. Henry attempted to dissipate her assets. The plaintiff would suffer irreparable harm without an injunction. The balance of convenience strongly favours the plaintiff despite the hardship the injunction will cause the Henry defendants.

[101] For the reasons below, and considering the matter de novo, I dismiss the motion to set aside the injunction.

Test for a Mareva injunction

[102] A Mareva injunction is available to freeze assets where there is a risk that the assets will be moved or dissipated to avoid judgment. It has been described as a “drastic and extraordinary remedy” because the courts do not generally grant judgment before a determination of the merits of a claim: see Pugliese v. Arcuri, 2011 ONSC 3157, 283 O.A.C. 175 (Div. Ct.), at para. 18; and Furrow Systems International Ltd. v. Island Pools & Landscaping Ltd., 2014 ONSC 1428, 43 C.L.R. (4th) 169, at para. 9.

[103] In O2 Electronics Inc. v. Sualim, 2014 ONSC 5050, at para. 67, Perell J. summarized the law relating to Mareva injunctions as follows:

For a Mareva injunction, the moving party must establish: (1) a strong prima facie case; (2) that the defendant has assets in the jurisdiction; and (3) that there is a serious risk that the defendant will remove property or dissipate assets before the judgment. A Mareva injunction should be issued only if it is shown that the defendant's purpose is to remove his or her assets from the jurisdiction to avoid judgment. The moving party must also establish that he or she would suffer irreparable harm if the injunction were not granted and that the balance of convenience favours granting the injunction.

[104] I am to consider whether or not to continue the injunction until trial de novo. I am to review the evidence, including the evidence obtained through the injunction, and reach my own conclusion about whether or not the plaintiff is entitled to an injunction.

Strong prima facie case

[105] Before assessing each of the plaintiff’s requested forms of interlocutory relief, I will assess whether or not the plaintiff has demonstrated a strong prima facie case for relief. The plaintiff has pleaded that the funds Dr. Waters transferred to Ms. Henry are impressed with a resulting trust, that Ms. Henry has been unjustly enriched, that Ms. Henry has committed civil fraud, obtained the funds through undue influence and in breach of fiduciary duties she owed to Dr. Waters, and unconscionable procurement. The plaintiff need demonstrate a strong prima facie case in respect of only one of the pleaded causes of action.

[106] The parties have not yet made documentary production and examinations for discovery have not been conducted. I am required to make findings on the current state of the evidence. A trial judge may reach different conclusions based on the evidence led at trial. Based on the evidence before me, however, I am satisfied that the plaintiff is likely to succeed against the Henry defendants on at least some of the pleaded causes of action.

Resulting trust

[107] Ms. Henry submits that Dr. Waters gifted approximately $27 million to her (net of certain repayments and money that was earned as caregiving income). The plaintiff submits that the bulk of the money Dr. Waters transferred to Ms. Henry is impressed with a resulting trust.

[108] A valid inter vivos gift is one that is intended to take effect during the lifetime of the donor. It consists of a voluntary transfer of property to another with the full intention that the property will not be returned. To establish a gift, one must show intention to donate, sufficient delivery of the gift, and acceptance of the gift: McNamee v. McNamee, 2011 ONCA 533, 106 O.R. (3d) 401, at para. 24.

[109] Equity presumes bargains, not gifts. If Dr. Waters gratuitously transferred property to Ms. Henry, the law presumes that she holds the property on a resulting trust for him: Pecore, at para. 24. The onus then shifts to Ms. Henry to rebut the presumption by proving Dr. Waters’ intention to gift: Sawdon Estate v. Watch Tower Bible and Tract Society of Canada, 2014 ONCA 101, 119 O.R. (3d) 81, at paras. 56-57; Mroz (Litigation guardian of) v. Mroz, 2015 ONCA 171, 125 O.R. (3d) 105, at para. 72. The presumption of resulting trust, therefore, alters the general rule that the plaintiff bears the legal burden: Pecore, at para. 24; Cherneyko et al, at para. 27. The shift in onus is particularly justified in cases where the party that transferred the funds is deceased. It is the recipient who is better placed to prove the circumstances of the transfer.

[110] I must start from that presumption and then assess all the evidence in an attempt to determine Dr. Waters’ actual intent at the time of the transfer: Pecore, at para. 44; Sawdon, at para. 57; Mroz, at para. 72. The evidence necessary to rebut the presumption depends on the facts of the case: Pecore, at para. 55. Evidence of Dr. Waters’ post-transfer conduct is admissible, so long as it is relevant to his intention at the time of the transfer: Pecore, at para. 59.

[111] I find that the plaintiff has presented a strong prima facie case that Ms. Henry will not be able to rebut the presumption of resulting trust at trial. I reach this conclusion for five reasons.

[112] First, Dr. Waters’ secondary will, which he signed on May 6, 2018, clearly expressed his understanding that Ms. Henry held assets for him on resulting trust. The secondary will provided that:

Provided GILLIAN HENRY, survives me, and provided she pays to my estate the assets she holds for me on resulting trust, 550,000 shares, for her own use absolutely.

[113] It will require a trial to determine what assets Ms. Henry held on resulting trust. However, this is compelling evidence that Dr. Waters did not intend to gift Ms. Henry all of the $27 million that she received.

[114] Second, Ms. Henry cannot rely on the presumption of advancement to displace the presumption of resulting trust as she and Dr. Waters were not married: Pecore, at para. 28; Hyman v. Hyman, 1934 CanLII 324 (SCC), [1934] 4 D.L.R. 532 (S.C.C.), at p. 538.

[115] Third, in her evidence, Ms. Henry explains that Dr. Waters gifted her this money because they had an “intimate relationship” and that he wanted her to be financially independent. I find that Ms. Henry’s evidence is, at this time, uncorroborated. There is no evidence that Ms. Henry or Dr. Waters ever told anyone about the alleged intimate relationship until Ms. Henry filed her affidavit in this proceeding. Ms. Henry’s uncorroborated assertions will not allow her to rebut the presumption of resulting trust: Evidence Act, s. 13; Burns Estate; Orfus Estate.

[116] Fourth, during the cross-examination on her affidavit, Ms. Henry admitted that she recalled only one conversation with Dr. Waters that resulted in him transferring money to her, despite there being 390 separate transfers. Moreover, on cross-examination she admitted that, even on her version of events, Dr. Waters did not demonstrate a full intention that the property would never have to be returned: “Dr. Waters was the person in control. The money was coming from him to me as a gift, so if he had changed his mind, he could have done that if he wanted to.” Ms. Henry admitted that she understood that if Dr. Waters had wanted her to pay back the money, then she would have had to pay back the money. This evidence significantly undermines Ms. Henry’s ability to rebut the presumption of resulting trust at trial.

[117] Fifth, I have reviewed all of the documents and notes to which Ms. Henry points in support of her assertion that Dr. Waters gifted this money to her. These documents do not, in my view, undermine significantly the strength of the plaintiff’s case. None of the notes or documents are contemporaneous with the transfers. Much of the evidence is equally consistent with there being no gift as with there being a gift and is, therefore, not corroborative: Pettenuzzo, at para. 68. None of the notes clearly expresses Dr. Waters’ intention to gift the money to Ms. Henry. It will be for the trial judge to make the final determination, but at this point I am satisfied that the documentary evidence does not undermine the plaintiff’s strong prima facie case for a resulting trust.

[118] In particular, I have serious doubts about the authenticity of two documents Ms. Henry relies on to support her submission that all of the transfers were gifts.

[119] The first document is a letter dated June 13, 2014. It is from Dr. Waters and is addressed “to whom it may concern.” There are three versions of the letter in the record. The first is an unsigned draft that was in the possession of the plaintiff and was provided on the ex parte motion. The second is a signed version with the date handwritten below the signature line. The third is a signed version with the date stamped below the signature line. Ms. Henry had the second and third versions of the letter in her possession. The key portion of the letter reads as follows:

Due to my health issues and more particularly those of my wife we have emplo9yed [sic] a number of care givers since 1999. In 2007 we employed Mrs. Sharon Prendergast RN to supervise and staff the process. In 2009 introduced me to Mrs. Gillian Henry who began her duties with us in May 2009. We were very impressed with Ms. Henry's caring attitude, efficiency and care to both of us. Given her marital difficulties we were also impressed by her hopes and eagerness to create a life of self-sufficiency for herself and her son (now 23) and daughter (now 17) who graduated from Pickering College on June 13 and who has been accepted at The University of Edinburgh September 2014.

In all, I and my corporation have provided -- in addition to salaries and gifts of appreciation, - $10,645,000 in loans in the expectation of her real estate and farm-based endeavours bearing fruit in due time. I also provide my professional expertise in the latter endeavour.

I have also provided my personal guarantee for the mortgage related to 9 Northern Dancer Lane, Aurora ON L4G 7Y7.

[120] Ms. Henry explained that this letter was prepared for use in her matrimonial proceeding with her ex-husband. She states that Dr. Waters told her “that he intended his sworn declaration of June 13, 2014 to serve the purpose of assisting me in resisting [her ex-husband’s] claim that my real estate assets and investments had been acquired during cohabitation and/or entitled him to spousal support and relieved him of child support obligations.” In the financial statement she filed in the family law litigation, Ms. Henry listed a $10 million liability to Dr. Waters and Waters Limited, which she describes as mortgage.

[121] On cross-examination, Ms. Henry stated that the letter was untrue and the $10,645,000 was a gift, not a loan. Ms. Henry’s evidence was that Dr. Waters knowingly signed a false document and that she knowingly tendered a false financial statement in her family law proceeding in order to reduce any amounts owing to her ex-husband. It is not clear whether or not Ms. Henry later filed an updated financial statement in the family proceeding.

[122] Jeffrey Brown, the person who notarized this letter, was examined for the purposes of this motion. Mr. Brown stated that the two signed versions of the letter dated June 13, 2014, were suspicious because neither appeared to have a date stamp beside his signature, which was his invariable practice. He was also concerned because his records indicated that he only notarized one letter that day but there now appeared to be two different versions of the letter. He also stated that the date stamp under Dr. Waters’ signature was not placed there by his office as the font was not one that he used.

[123] The second letter Ms. Henry relies on is dated August 27, 2014. This letter purports to be from Dr. Waters and is addressed to Ms. Henry. It reads as follows:

Further to my affidavit dated June 13, 2014 on this matter, this document is an amendment to recognize as "loans" only those covered by formal documentation: i.e ., (1) the mortgage on 64 Elder Cres ., Brooklin, ON L.1M 2H7 in the amount of $400,000. (Four hundred thousand dollars) and (2) the promissory note relating to No. 1 Delight Way, Brooklin and King of Hearts Stables, Bronte Rd. in the amount of $ 1,000,000. (One million dollars). The additional funds included in the June 13, 2014 affidavit represent non-repayable imbursements.

[124] On cross-examination, counsel for Ms. Henry refused to provide the content of the family law file for use on this motion. I draw the inference that the content of the family law file would not support Ms. Henry’s submission regarding the meaning or use of the letters. In such circumstances, I am not prepared to conclude that the letter dated August 27, 2014, is authentic or to reach a final conclusion on the meaning of the very unusual and idiosyncratic phrase “non-repayable imbursements.” The archaic meaning of imbursement is “money laid up in stock,” which may not be consistent with the transfers having been gifts. The interpretation of this letter will be an issue for trial.

[125] In conclusion, I find that the plaintiff has demonstrated a strong prima facie case that the $27 million in gratuitous transfers from Dr. Waters to Ms. Henry are impressed with a resulting trust.

Unjust enrichment

[126] To establish unjust enrichment, a plaintiff must show an enrichment, a corresponding deprivation, and the absence of a juristic reason: Moore v. Sweet, 2018 SCC 52, [2018] 3 S.C.R. 303, at para. 37; Sirius Concrete Inc. (Re), 2022 ONCA 524, at para. 18.

[127] The plaintiff has presented a strong prima facie case that Ms. Henry was enriched, and Dr. Waters’ estate was deprived of at least $27 million. Ms. Henry submits that there is a juristic reason for her enrichment: Dr. Waters gifted the money to her.

[128] For the reasons set out in paragraphs [107] to [125], I find that Ms. Henry is unlikely to rebut the presumption of resulting trust. I do not accept that Ms. Henry has provided ample evidence of Dr. Waters’ donative intent. I find that the plaintiff has established a strong prima facie case of unjust enrichment.

Civil fraud

[129] A plaintiff must establish four things to make out a claim in civil fraud: (a) the defendant made a false representation; (b) the defendant had some level of knowledge that the representation was false; (c) the false representation caused the plaintiff to act; and (d) the plaintiff’s actions resulted in a loss: Bruno Appliance and Furniture Inc. v. Hryniak, 2014 SCC 8, [2014] 1 S.C.R. 126, at para. 21.

[130] The plaintiff’s theory of the case is that Ms. Henry engaged in a massive fraud. She represented to Dr. Waters that she would purchase and hold properties in numbered corporations for his benefit. Instead, she did not issue shares in the corporations to Dr. Waters, held the properties in her own name or in her solely owned corporations, gave properties to third parties, and traded them on her own account. The plaintiff alleges that Ms. Henry engaged in a complex series of real estate transactions that defrauded Dr. Waters. For example, the plaintiff points to evidence in the record to support the following acts of fraud:

a. Ms. Henry told Dr. Waters that she was giving the property known as 1374 Linstead to her sister-in-law, as a gift. Instead, however, Ms. Henry sold it for $170,000. She used the sale proceeds to purchase 154 Taunton. At the same time, Ms. Henry obtained funds from Dr. Waters ostensibly to purchase 154 Taunton and then used the funds for some other purpose or otherwise dissipated them.

b. Ms. Henry obtained funds from Dr. Waters to purchase 152 Taunton. She then gifted the property to her sisters and purchased it back from her sisters through one of the numbered corporations again using funds from Dr. Waters.

c. Ms. Henry would often pay to Dr. Waters only some of the proceeds from the sale of properties purchased with funds provided by Dr. Waters:

i. Ms. Henry paid Dr. Waters only $400,000 of the $769,000 in sale proceeds from 7790 Concession;

ii. Ms. Henry paid Dr. Waters’ estate only $500,000 from the $643,360 in sale proceeds from 2524 Bromus; and

iii. Ms. Henry paid Dr. Waters’ estate only $100,000 from the $532,000 in sale proceeds from the two units at 350 Harry Walker;

d. Ms. Henry encumbered a property in which the plaintiff had a proprietary right and caused a numbered company to use the funds to both purchase her parents’ existing house from them for $850,000 and to buy a house for $1.4 million in which her parents lived rent free.

[131] The Henry defendants submit that the allegations of fraud are not borne out in the evidence and that the evidence establishes that Dr. Waters, with the exception of certain loans, wanted to gift the funds to Ms. Henry.

[132] I do not accept the submissions of the Henry defendants on this point, for the reasons set out above. At trial, the Henry defendants may be able to prove that some of the 390 transfers were gifts. At trial, the plaintiff may not be able to prove that all of the 390 transfers were frauds. However, I am satisfied that the plaintiff has demonstrated a strong prima facie case that Ms. Henry committed a fraud in respect of many of the 390 transactions.

Undue Influence

[133] Where the potential for domination inheres in the relationship between the transferor and transferee, the presumption of undue influence applies: Goodman Estate v. Geffen, 1991 CanLII 69 (SCC), [1991] 2 S.C.R. 353, at p. 378. In this case, that would mean that Ms. Henry must establish on a balance of probabilities that the gift was the result of Dr. Waters’ “full, free and informed thought”: Goodman Estate, at p. 379.

[134] Ms. Henry says that the potential for domination did not inhere in her relationship with Dr. Waters. She states that she was not Dr. Waters’ personal support worker as demonstrated by the invoices from her company. She maintains that she was Dr. Waters’ employee, but not his service provider. She maintains that she may have brought him tea or covered his dialysis port before he showered but that this did not make her his personal service worker. She maintains that Dr. Waters was independent and mentally astute throughout the period she worked for him.

[135] The plaintiff, on the other hand, asserts that Ms. Henry was Dr. Waters personal service worker. The plaintiff points to the notarized letter dated June 13, 2014, discussed above, in in which Dr. Waters wrote, “We were very impressed with Ms. Henry's caring attitude, efficiency and care to both of us.” In her supplementary affidavit, Ms. Kussinger stated that she always understood that Ms. Henry was the caregiver for both Dr. Waters and Mrs. Waters based on her own observations over the years. She saw Ms. Henry prepare meals and tea for Dr. Waters and had text messages indicating that Ms. Henry showered Dr. Waters. In addition, Ms. Kussinger provided a series of email messages sent by Dr. Waters from 2010 through 2017 that describe worsening health issues, his need for home dialysis, and his increasing trouble with his memory.

[136] Both the plaintiff and Ms. Henry agree that Ms. Henry was an important person in Dr. Waters’ life and provided significant support to him directly and indirectly by caring for his ailing wife.

[137] I have some difficulty accepting Ms. Henry’s statements at face value. Some of her testimony raises serious concerns about her credibility, including the following:

a. she has testified that she knowingly provided false information, underrepresented her assets, and did not reveal the sale of certain properties in her family law proceeding;

b. until confronted with evidence to the contrary,

i. she denied that, after Dr. Waters’ death, she continued to use a home equity line that he had guaranteed;

ii. she denied that she had tried to sell the horse-farm (that was purchased with Dr. Waters’ funds) for $15 million after Ms. Kussinger asked her about the debts she owed to Dr. Waters; and

iii. she denied that she had received an offer of $15 million for the horse-farm.

[138] Where Ms. Henry’s evidence about her relationship with Dr. Waters is inconsistent with the evidence of Ms. Kussinger and the written documents, I prefer the latter.

[139] I find that the plaintiff has presented a strong prima facie case that the potential for domination inhered in the relationship between Ms. Henry and Dr. Waters. For the reasons set out above with respect to resulting trust, I think it unlikely that Ms. Henry will be able to establish on a balance of probabilities that the 390 transfers were each the result of Dr. Waters’ “full, free and informed thought.”

Breach of fiduciary duty

[140] The plaintiff submits that Ms. Henry owed fiduciary duties to Dr. Waters both as his personal services worker and because they were business partners.

[141] The Henry defendants submit that the generic label “caregiver” does not give rise to a fiduciary relationship. Although the Henry defendants did not address this in their factum, I infer that they submit that Ms. Henry and Dr. Waters were not business partners because he gifted her the funds.

[142] Even accepting that the plaintiff has established a strong prima facie case that Ms. Henry provided caregiving services to Dr. Waters, I find that the plaintiff has not established that a fiduciary relationship arose between Ms. Henry and Dr. Waters in connection with the transfers because she was his personal services worker. Certain status relationships, such as solicitor-client or doctor-patient, give rise to a per se fiduciary relationship: Lac Minerals Ltd. v. International Corona Resources Ltd., 1989 CanLII 34 (SCC), [1989] 2 S.C.R. 574, at para. 30, citing Guerin v. R., 1984 CanLII 25 (SCC), [1984] 2 S.C.R. 335, at p. 384. I am not certain that the plaintiff has established a strong prima facie case that: (a) the relationship of personal services worker-patient is a status relationship that attracts a fiduciary duty; and (b) that, even if it did, the scope of the fiduciary duty that inheres in that relationship would extend to a $27 million business venture between the two individuals in that relationship. For a fiduciary duty to arise, there must be an undertaking by the fiduciary, express or implied, to act in accordance with the duty of loyalty reposed on him or her: Galambos v. Perez, 2009 SCC 48, [2009] 3 S.C.R. 247, at para. 75.

[143] However, I find that the plaintiff has established a strong prima facie case that Ms. Henry breached an ad hoc fiduciary duty to Dr. Waters arising from their business dealings. Relationships in which a fiduciary obligation have been imposed have three general characteristics:

a. The fiduciary has scope for the exercise of some discretion or power;

b. The fiduciary can unilaterally exercise that power or discretion to affect the beneficiary’s legal or practical interests;

c. The beneficiary is peculiarly vulnerable to or at the mercy of the fiduciary holding the discretion or power. Elder Advocates of Alberta Society v. Alberta, 2011 SCC 24, [2011] 2 S.C.R. 261, at para. 27, citing Frame v. Smith, 1987 CanLII 74 (SCC), [1987] 2 S.C.R. 99, at p. 136.

[144] An ad hoc fiduciary duty can arise where a claimant shows that:

a. the alleged fiduciary gave an undertaking of responsibility to act in the best interests of a beneficiary;

b. a defined person or class of persons is vulnerable to the alleged fiduciary’s exercise of discretionary power over them; and

c. the alleged fiduciary’s power may affect the beneficiary’s legal or substantive practical interests. Elder, at paras. 30-34 and 36; Extreme Venture Partners Fund I LP v. Varma, 2021 ONCA 853, 24 B.L.R. (6th) 38, at para. 102, citing Galambos, at paras. 66 and 83.

[145] I find that the plaintiff has demonstrated a strong prima facie case that an ad hoc fiduciary relationship arose between Ms. Henry and Dr. Waters. There is evidence that Dr. Waters was vulnerable to Ms. Henry in that:

a. Ms. Henry designed the structure of the business enterprise, including the imposition of the numbered companies, to empower herself to exercise fully the discretion and authority to buy, sell, and improve properties using funds from Dr. Waters;

b. Ms. Henry was the directing mind and sole shareholder of the numbered corporations and never issued shares of any kind to Dr. Waters;

c. Ms. Henry was able to buy and sell properties without the involvement of Dr. Waters (other than the provision of the funds) and was able to misrepresent those sales and to account to him for only some of the proceeds of sale.

[146] I am satisfied that the plaintiff has demonstrated a strong prima facie case that Ms. Henry gave Dr. Waters an undertaking to act in his best interests with respect to the investments. Dr. Waters was vulnerable to Ms. Henry as a business partner, not just because of his failing health and the nature of their personal service relationship. The vulnerability was inherent in the nature of the business venture and in the wide discretion he granted to Ms. Henry to purchase and improve the properties. He was very vulnerable to Ms. Henry’s non-disclosures and misrepresentations. The plaintiffs have established a strong prima facie case that Ms. Henry could, and did, exercise her power to affect Dr. Waters’ legal or substantive practical interests.

[147] I find that the plaintiff has established a strong prima facie case that Ms. Henry breached ad hoc fiduciary duties owed to Dr. Waters in respect of at least some of the 390 transactions.

Unconscionable procurement

[148] The plaintiff submits that it has demonstrated a strong prima facie case of unconscionable procurement. The plaintiff relies on the thoughtful decision of Kimmel J. in Gefen v. Gaertner, 2019 ONSC 6015, 148 O.R. (3d) 229, at paras. 159 and 181. However, the status of the doctrine of unconscionable procurement in Ontario remains uncertain. The Court of Appeal for Ontario dismissed the appeal from the decision of Kimmel J. in reasons reported at 2022 ONCA 174, 161 O.R. (3d) 267. At para. 61, however, the Court of Appeal held as follows:

The parties did not challenge the validity of the doctrine of unconscionable procurement. In the absence of full legal argument on the existence and desirability of any doctrine of unconscionable procurement, I do not propose to address the merits of any such doctrine and whether grounds to attack transactions beyond such traditional grounds as undue influence and incapacity should be endorsed. Thus, this decision should not be taken as approval or rejection of unconscionable procurement being part of the law of Ontario.

[149] Given the uncertain state of the law, and my findings on the other causes of actions, it is not necessary for me to consider whether or not to uphold the injunction on the basis of the pleaded cause of action of unconscionable procurement. The parties are, of course, free to argue this point at trial.

Conclusion

[150] For the reasons set out above, I am satisfied that the plaintiff has made out a strong prima facie case in respect of at least some of the pleaded causes of action.

Assets in the jurisdiction

[151] There is no dispute that the Henry defendants have assets in the jurisdiction. The original order of Myers J. imposed certificates of pending litigation against 11 different properties owned by the Henry defendants. As a result of the original Norwich order, the plaintiff has identified many bank accounts held by the Henry defendants.

[152] I find that the plaintiff has satisfied this branch of the test.

Risk of dissipation of assets

[153] I am satisfied there is a serious risk that the Henry defendants will remove property or dissipate assets before the judgment. The evidence on this point is overwhelming.

[154] In Ontario law, there is no broad “fraud exception” to the usual criteria for a Mareva injunction: Sibley & Associates LP v. Ross, 2011 ONSC 2951, 106 O.R. (3d) 494, at paras. 15 to 63; Noreast Electronics Co. Ltd. v. Danis, 2018 ONSC 879, at paras. 51-53. The plaintiff must still demonstrate that there is a serious risk of the dissipation or removal of assets. However, strong proof of fraud is relevant to the assessment of the risk. In Sibley, at para. 63, Strathy J. (as he then was) put it this way:

It should be sufficient to show that all the circumstances, including the circumstances of the fraud itself, demonstrate a serious risk that the defendant will attempt to dissipate assets or put them beyond the reach of the plaintiff.

[155] In OPFFA v. Atkinson, 2019 ONSC 3877, at para. 8., Diamond J. held that proof of the risk of removal or dissipation of assets may, in the appropriate case, be inferred from the surrounding circumstances of a responding party’s misconduct. The list of relevant factors for the court’s consideration includes (a) a responding party’s attempt to “cover up his/her tracks”, (b) a responding party’s attempt to destroy, hide or alter evidence, and (c) any conduct demonstrating the traditional “badges of fraud.”

[156] I find that there is a real risk that the defendants will attempt to dissipate or hide their assets or remove them from the jurisdiction. I reach this conclusion for six reasons.

[157] First, of the $29 million transferred by Dr. Waters to Ms. Henry, of which $27 million was transferred gratuitously, the plaintiff has only identified $13 million that is traceable into the purchase of real property. It appears that over $14 million may have already been dissipated through, among other means, consumption and gifts. This highlights the importance of looking carefully at the remaining assets and assessing whether or not they should be preserved pending trial.

[158] Second, I find that the call between Ms. Kussinger and Ms. Henry in February 2021 is a highly relevant marker. Ms. Kussinger states that she told Ms. Henry that she was trying to get a picture of Dr. Waters’ financial situation and that she was missing documents. Ms. Kussinger states that she asked Ms. Henry to provide full particulars of the debts Ms. Henry owed to Dr. Waters. The Henry defendants strenuously submit that this call was not confrontational and, therefore, would not have triggered Ms. Henry to take any steps to dissipate property and, indeed, she did not do so.

[159] I disagree with the submission of the Henry defendants. It does not matter whether or not the call was confrontational. The tone of the call is not what makes it important. The call is important because it marked the first time someone asked Ms. Henry to account for the money she owed to Dr. Waters. Someone other than Dr. Waters was now trying to piece together the state of Dr. Waters’ finances. The evidence of the risk of dissipation is found in what Ms. Henry did next.

[160] Third, following the call with Ms. Kussinger, Ms. Henry completely altered how she dealt with the properties she had purchased with the funds. Between May 2009 and 2021, Ms. Henry sold three properties. However, in the months after February 2021, Ms. Henry sold six properties for almost $4 million, placed three mortgages worth $5.1 million on four other properties, and tried to sell her largest asset, the horse farm, at a fire sale price, $15.8 million down from $18.8 million she had listed the property at in June 2020. This increased commercial activity supports an inference that Ms. Henry was attempting to extract cash from her inventory of property, which would make it unavailable to repay the amounts owing to the Waters estate. Ms. Henry has not provided a satisfactory explanation for why she engaged in this set of transactions.

[161] Fourth, Ms. Henry then engaged in a series of transactions to dissipate the cash she obtained from the property sales. Ms. Henry withdrew hundreds of thousands of dollars in cash from the proceeds of sale. She made large transfers to unknown persons. She transferred $250,000 to her parents.

[162] Fifth, I do not accept Ms. Henry’s explanations regarding the purpose of these transactions or what happened to the money for three reasons:

a. Ms. Henry could not explain what happened to over $2.5 million of the money she received from the liquidation of the property. On cross-examination, she provided an undertaking to explain what happened, but that undertaking remained unfulfilled.

b. Ms. Henry was evasive during her cross-examination and gave false answers on extremely material issues until confronted with documents disproving her assertions. For example, in 2020, Ms. Henry had listed the horse farm for sale for $18.8 million. After the call with Ms. Kussinger, Ms. Henry re-listed the property for $15.8 million. On cross-examination, Ms. Henry denied that she had attempted to sell the property after February 2021. She denied that she had listed the property for sale when shown an appraisal report that stated the property had been listed for sale on May 3, 2021. She only admitted that she listed the property for sale when she was shown an MLS report of the listing. When she was asked if she obtained an offer to buy the property, she denied receiving such an offer. She finally conceded that point when confronted with evidence to the contrary.

c. Ms. Henry provided evasive answers and incomplete evidence with respect to withdrawals from her Scotiabank account after the Mareva order was put in place. On June 27, 2022, she confirmed on cross-examination that she had not withdrawn any money from the account after being served with the interim order. As an answer to an undertaking, she provided an account balance for the Scotiabank account as of June 29, 2022. She then removed money from the Scotiabank account. This was only discovered by the plaintiff when Scotiabank provided original account statements pursuant to the Norwich order issued by Myers J. Ms. Henry’s actions breached the Mareva order. I find that she attempted to cover up this breach by providing inaccurate information about her Scotiabank account in response to her answers to undertakings. This conduct causes me very grave concern about the risk of further dissipation of assets.

[163] Sixth, I infer that there is a risk of removal or dissipation of assets from the surrounding circumstances of Ms. Henry’s misconduct that the plaintiff has demonstrated to the standard of a strong prima facie case: OPFFA, at para. 8. I find that Ms. Henry has attempted to cover her tracks, destroy, hide, or alter evidence. As set out above, Ms. Henry’s actions demonstrate many of the traditional badges of fraud.

[164] For all of these reasons, I conclude that there is a significant risk that the Henry defendants will further dissipate assets absent a continuation of the injunction.

Risk of irreparable harm

[165] For of the reasons set out above, I am satisfied that the plaintiff has demonstrated that it will suffer irreparable harm if the injunction is not granted. The normal basis for irreparable harm in cases of this kind is that, if the defendant’s assets are not secured, there will be no way for the plaintiff to collect on a money judgment: East Guardian SPC v. Mazur, 2014 ONSC 6403, 64 C.P.C. (7th) 90, at para. 41; OPFFA, at para. 25. This principle applies strongly in this case.

Balance of convenience

[166] In their factum, the Henry defendants submit that the Mareva injunction has caused them severe financial distress. They also note that Ms. Henry has been notified by a credit agency that her credit score has dropped and that certain mortgagees have charged penalties because certain mortgage payments were declined due to the effect of the Mareva order.

[167] I do not wish to understate the inconvenience of the Mareva injunction. The injunction has been adjusted over time to ensure that the month-to-month necessities may be paid. The Henry defendants may apply to the court as necessary to ensure that existing mortgages and properties are serviced.

[168] I have considered their other submissions in assessing the balance of convenience. In this case, the balance of convenience strongly favours the plaintiff.

Certificates of pending litigation

[169] A two-part test governs the issuance of a CPL. First, the court must determine whether the plaintiff has a triable claim to an interest in land. Second, the court must consider all relevant factors between the parties, including whether damages would be a satisfactory remedy, and balance the interests of the parties in the exercise of its discretion as to issue a CPL: Shirkhodaeitari v. Farkhondeh, 2022 ONSC 3864, at para. 16; Rahbar v. Parvizi, 2022 ONSC 1104, at para. 20.

[170] In this case, for the reasons set out above, the plaintiff has demonstrated that they are likely to succeed on their claims against the Henry defendants. It is undisputed that the property in question was purchased with funds obtained from Dr. Waters. Given the potential availability of tracing and other equitable remedies, the plaintiff has a triable claim to an interest in that property.

[171] Considering all the relevant factors between the parties, and balancing the interests of the parties, the certificates of pending litigation should remain in place until trial. In reaching this decision, I rely on the same findings that supported the Mareva order.

Conclusion

[172] For the reasons set out above, I dismiss the Henry defendants’ motion to set aside the Mareva injunction order issued by Myers J., as amended. I also dismiss the Henry defendants’ motion to discharge the registration of the certificates of pending litigation on the properties listed in the order of Myers J.

[173] If the parties are not able to resolve costs, the plaintiff may deliver its costs submission of no more than five double-spaced pages to be emailed to my assistant on or before October 3, 2022. The Henry defendants may deliver a single responding submission of no more than five double-spaced pages on or before October 10, 2022. No reply submissions are to be delivered without leave.

Robert Centa J.

Date: September 27, 2022

[^1]: Orders of Morgan J. dated June 17, 2022, Myers J. dated July 7, 2022, and Vermette J. dated July 21, 2022.