Dymon Storage Corporation v. Nicholas Caragianis, 2022, ONSC 5883

COURT FILE NO.: CV-22-00683712-0000

DATE: October 18, 2022

SUPERIOR COURT OF JUSTICE – ONTARIO

RE: DYMON STORAGE CORPORATION

Plaintiff

AND:

NICHOLAS CARAGIANIS, NICHOLAS CARAGIANIS ARCHITECT INC., SARAH MURRAY, WPT ARCHITECTURE INC., MEGAN MOLSON, KATELYN LUCAS-KELLNER, SANTIAGO GUARDIA AKA JAVIER SANTIAGO GUARDIA MIRANDA AKA XAVIER G. MIRANDA and BLISS EDWARDS

Defendants/Responding Party

BEFORE: Koehnen J.

COUNSEL: Matthew Gottlieb, Paul Fruitman, Tom Macintosh Zheng, for the plaintiff

David R. Elliott, Emily L. McMurtry, for the Defendants Nicholas Caragianis, Nicholas Caragianis Architect Inc., Sarah Murray, WPT Architecture Inc., Megan Molson, Katelyn Lucas Kellner and Santiago Guardia aka Javier Santiago Guardia Miranda aka Xavier G. Miranda

Jennifer Teskey, Ted Brooke, for the defendant Bliss Edwards

HEARD: October 11, 2022

ENDORSEMENT

OVERVIEW

1The plaintiff, Dymon Storage Corporation is a corporation in the business of building self storage units in Ottawa and the greater Toronto region. Dymon moves for an injunction against the defendants to restrain them from working for a competitor, SmartStop Selfstorage, and to restrain them from sharing with SmartStop, information that is confidential to Dymon.

2The defendants oppose the injunction. In addition, the defendant Bliss Edwards moves for an order striking the claim against her as disclosing no cause of action or, in the alternative, staying the claim against her in favour of arbitration which she submits is called for by her employment agreement with Dymon.

3I dismiss the motion for an injunction restraining the defendants from competing with Dymon. Although Edwards’ employment agreement contains a noncompetition covenant, it is unenforceable because it is unreasonably broad. It purports to have Canada wide application even though Dymon is active only in the greater Toronto region and in Ottawa and purports to apply for 10 years. Dymon also seeks a noncompetition injunction against Edwards on the ground that she is a fiduciary of Dymon. I find that not to be the case. Her employment agreement specifically provides that she has no power to bind Dymon or its affiliates in any way. That fundamentally undermines any claim that she is a fiduciary.

4The other defendants had no written noncompetition agreement with the plaintiff. Although the plaintiff submitted that the defendants other than Edwards has an oral noncompetition agreement with the plaintiff, I find that the plaintiff has not demonstrated either a serious issue to be tried or a strong prima facie case in this regard.

5With respect to the request for an injunction to restrain the defendants from misusing confidential information, the plaintiff’s claim has two fundamental defects. First, it fails to identify with the required level of precision what information is confidential and why it is confidential. Second, it appears to confuse confidentiality with know-how. Instead, the plaintiff relies on well-crafted but, at the end of the day, bald assertions of confidentiality.

6The plaintiff has demonstrated a serious issue to be tried with respect to the confidentiality of an epoxy flooring system and with respect to architectural drawings prepared by individuals other than NCA or its employees. I therefore order the non-Edwards defendants to surrender all copies of any such materials to Dymon.

A. The Facts

7The defendants other than the defendant Bliss Edwards, were at all material times architects or other employees associated with Nicholas Caragianis Architect Inc. (“NCA”). The defendant Sarah Murray is the spouse of Nicholas Caragianis.

8NCA worked with Dymon for approximately 11 years on 17 different Dymon sites and was its Architect of Record for all sites without a residential component.

9As part of that work, NCA participated in Dymon’s strategy meetings concerning issues such as design, land acquisition and developing Alternative Code Solutions.¹

10The defendant Bliss Edwards was employed by Dymon as its Chief Planner between 2015 and 2019. She earned income of approximately $100,000 a year plus bonuses.

11Edwards left Dymon on March 17, 2019, pursuant to a settlement agreement that terminated her employment with the consent of both parties. She joined SmartStop approximately two months after leaving Dymon. There is disagreement between the parties about when Edwards began having discussions with SmartStop. I do not think the timing of those discussions matters much. An employee is free to look for employment with a competitor while she is still working with her current employer.

12Shortly after joining SmartStop, Edwards solicited Alan Giller, Dymon’s Senior Vice President of Construction and Development and two of Dymon’s architects to join her at SmartStop. They declined. Edwards’ employment agreement did not contain any non-solicitation clause.

13Edwards also retained NCA to act for SmartStop.

14The work NCA did for SmartStop was done through the defendant WPT Architecture Inc. WPT was incorporated by Caragianis’ wife, the defendant Sarah Murray, shortly before beginning to do work for SmartStop. WPT has no employees and operates out of Caragianis’ and Murray’s home. Neither WPT nor Murray had any self storage experience. WPT was not registered with the Ontario Association of Architects.

15The work WPT did for SmartStop was done by the defendant Santiago Guardia, the lead architect of NCA on Dymon’s projects. When working for SmartStop through WPT, Guardia did so under the pseudonym Xavier G. Miranda.

16Dymon alleges that SmartStop worked on at least two projects with WPT; a site at 70 Taunton Road East in Whitby and a site at 2911 Eglinton Avenue East in Toronto (the Home Depot site).

B. The Test for an Injunction

17The test for an interlocutory injunction is well known. It requires the moving party to demonstrate that:

a. It has a strong prima facie case or a serious question to be tried;

b. The moving party would suffer irreparable harm if the injunction were not granted; and

c. The balance of convenience favours granting an injunction.²

18The parties disagree about whether the first branch of the test requires a strong prima facie case or merely a serious question to be tried.

19The plaintiff seeks two forms of interlocutory relief. The first is an order that would prohibit the defendants from working for SmartStop or any other competitor of Dymon. The second would prohibit the defendants from sharing confidential information with SmartStop and would require them to surrender to Dymon any confidential information in their possession.

20Where the interlocutory injunction limits a responding party’s ability to earn a living, courts have tended to apply the higher, strong prima facie case test.³ That same, higher test applies to mandatory injunctions that require the defendant to take positive action.⁴

21To determine whether an injunction is mandatory or prohibitive, courts “look past the form and the language in which the order sought is framed, to identify the substance of what is being sought and, … ‘what the practical consequences of the . . . injunction are likely to be’ ”.⁵ Where the practical consequences are intrusive to the responding party, the strong prima facie case test applies.⁶

22If Edwards is enjoined from working with SmartStop or any other competitor of Dymon, it will seriously limit her ability to earn a living. It would mean she could not work for any self storage company and would thereby render useless the experience she has gained during her four years at Dymon and the further three years at SmartStop.

23If WPT and NCA are prohibited from working for Smart, WPT will be required to terminate nearly all its ongoing contracts. That, in turn, will cause NCA to lose approximately 25% of its revenue.

24These are intrusive, draconian forms of relief to which the elevated strong prima facie case test should apply.

25The surrender of confidential information involves a different analysis. Although it is on its face a mandatory order and might therefore be seen to call for the strong prima facie case test, I am inclined to apply the reasonable issue to be tried test to that relief. The essence of the relief is not so much the mandatory surrender of information as it is the prohibitive restraint on using the information. That strikes me more as a prohibitive injunction than a mandatory one.

26I turn then to apply these tests to the facts surrounding the requests for relief.

C. Noncompetition Relief

a. Relief against NCA and WPT

27Dymon has not, in my view, made out a case sufficient to justify an interlocutory injunction to restrain NCA, WPT or their employees from competing with Dymon regardless of the applicable test.

28Dymon alleges that NCA was subject to an oral noncompetition agreement with it. Dymon’s principal affiant, Alan Giller, says in his affidavit that Caragianis used the noncompetition covenant to justify higher fees from Dymon.

29I have not been taken to any evidence that describes how or when the alleged oral noncompetition covenant was agreed to. Nor have I been taken to any evidence concerning the terms of the alleged noncompetition covenants such as geographic or temporal scope.

30If Dymon truly wanted a noncompetition covenant from NCA that would survive the termination of the relationship, one would expect that something so draconian would be reduced to writing.

31Caragianis says that he knew that Dymon did not want him working for competitors but that there was no obligation for him not to do so. That strikes me as more probable. Businesses will sometimes ask service providers not to act for competitors. If the service provider does act for a competitor, the relationship may well be at an end. That, however, is a far cry from trying to prevent a service provider from acting for a competitor after the termination of the relationship.

b. Noncompetition Relief Against Edwards

32As with NCA, Dymon has not, in my view, made out a case sufficient to justify an interlocutory injunction to restrain Edwards from competing with Dymon regardless of the test applicable for an interlocutory injunction in this regard.

33The claims for noncompetition relief against Edwards are rooted in the allegation that she was a fiduciary and the written noncompetition covenant in her employment agreement.

34Turning first to the claim rooted in the alleged fiduciary relationship, the test to establish a fiduciary relationship is well-known:

1. The fiduciary must have the ability to exercise discretion or power;

2. The fiduciary must be able to unilaterally exercise that power or discretion so as to affect the beneficiary’s legal or practical interest; and

3. The beneficiary of the fiduciary duty must be peculiarly vulnerable to or at the mercy of the fiduciary holding the discretion or power.⁷

35Edwards does not fall within this test. She was not a member of the executive team of Dymon or any of their affiliates. She had no direct reports, no ability to hire or fire employees, no power to sign contracts, and no authority to file planning documents without the approval of her superior, Steve Creighton, Dymon’s Senior Vice-President.

36Section 2 of her employment agreement specifically provided that she had no authority “to hold [her]self out as having any right, power, or authority to create any contract or obligation, either express or implied, on behalf of” Dymon. That alone undermines the existence of any fiduciary relationship because it demonstrates that none of the prerequisites to a fiduciary duty were present here.

37I turn then to the noncompetition covenants in Edwards’ employment agreement.

38As a result of the Working for Workers Act,⁸ noncompetition covenants in employment contracts are now generally prohibited in Ontario, subject to certain exceptions. That provision, however, only applies to agreements entered into after October 25, 2021. Earlier agreements remain subject to common law analysis on enforceability.⁹

39Section 8 of Edwards’ employment agreement restrained her from being involved in any way, with any business, anywhere in Canada, that is competitive to any of Dymon’s businesses, for a period of 10 years.

40A covenant that prevents a departing employee from competing with the employer is prima facie unenforceable. ¹⁰ Such covenants may be upheld if they are reasonable in light of the interests of the parties and the public.¹¹

41The party seeking to enforce a restrictive covenant bears the onus of demonstrating that it is reasonable as between the parties. The party seeking to avoid enforcement bears the onus of demonstrating that it is unreasonable with respect to the public interest.¹² Reasonableness is assessed at the time the agreement is made.¹³

42The factors considered when assessing reasonableness of a noncompetition covenant include the extent of the activity prohibited, the geographic scope of the restriction, and its duration.¹⁴ Contextual factors may also be important. Payment of an extraordinary amount in consideration for a noncompetition covenant may make it more enforceable than payment of an ordinary salary.

43If a noncompetition covenant is found to be unreasonable, it is struck out. It cannot be read down or rewritten to become more reasonable. ¹⁵

44In my view, the noncompetition covenant in Edwards’ employment agreement is unreasonable and is therefore unenforceable. The covenant purports to have effect throughout all of Canada even though Dymon operates only in the greater Toronto region and in Ottawa. In addition, the 10-year scope of the covenant is well beyond what other courts have found to be enforceable. By way of example, in 1003126 Ontario Ltd. v. DiCarlo, the court held that even a two-year noncompetition covenant would “be the exception and not the rule.”¹⁶

45Dymon attempts to rehabilitate the clause by submitting that Edwards was paid for her noncompetition covenant as a result of the settlement agreement that terminated her employment. I disagree. The settlement agreement paid Edwards her Employment Standards Act entitlement plus some additional payments if any of the Home Depot projects on which she had been working came to fruition. Although the settlement letter merely reminded Edwards of the noncompetition covenant in her employment agreement, it did not tie any of the payments under the settlement to consideration for a covenant not to compete.

46In addition, enforcing the noncompetition covenant raises limitations issues that preclude Dymon from asserting a strong prima facie case. Edwards joined SmartStop in May 2019. In November 2019 Creighton met her wearing a SmartStop name tag at the Canadian Self Storage Association Conference in Toronto. This meant that any limitation period with respect to the noncompetition covenant would arguably run as of November 2019. The claim was not commenced until 2022, well after the expiry of the limitation period.

D. Confidentiality Obligations

47The right to an injunction must be addressed here vis-à-vis the law of confidentiality. The law confidentiality has three elements: (i) The information must have the necessary quality of confidence; (ii) The information must be communicated in confidence; (iii) the information must be used to the detriment of the owner of the information.

48It is the first element of that test that is at issue here. I am prepared to assume that the information was communicated in confidence if it has the necessary quality of confidence. If the information has the necessary quality of confidence, I am also content to assume that the plaintiff seeks the injunction to prevent misuse of the information to its detriment.

49To have the necessary quality of confidence the information must not be of a general nature but must be specific.

(i) The specific information must not be generally known to the public but can be acquired from materials available to the public with the expenditure of time and effort without losing its confidential aspect.

(ii) The owner of the information must treat it as confidential.

(iii) If there is disclosure to a third party beyond the employment relationship, the owner should require of that party that there cannot be disclosure or use in any way not authorized expressly by the owner.¹⁷

50The second element of this test is frequently referred to as the “springboard principle.” That principle was described in Matrox Electronic Systems Ltd. v. Gaudreau,¹⁸ as prohibiting an individual from using information obtained in confidence as a springboard for activities detrimental to the person who made the confidential communication:

What is really being protected in situations of this nature is the original process of mind. The protection is enforced against persons who wish to use the confidential information without spending the time, trouble and expense of going through the same process. One can reconcile the springboard principle with the overriding principle denying confidence in information in the public domain, by describing the "springboard" as a measure of the scope and duration of the obligation enforcing good faith upon an ex-employee while the rest of the world catches up.¹⁹

51In effect this amounts to protection for the original investment of time and money.²⁰

52It has been said that

… equity has set a relatively low threshold on what kinds of information are capable of constituting confidential information and that "some product of the human brain applied to existing knowledge" could suffice.²¹

53To determine whether information has the necessary “quality of confidence,” courts have considered:

a. The extent to which the information is known outside the business;

b. The extent to which it is known by employees and others involved in the business;

c. Measures taken to guard the secrecy of the information;

d. The value of the information to the holder of the secret and to its competitors’

e. The effort or money expended in developing the information;

f. The ease or difficulty with which the information can be properly acquired or duplicated by others; and

g. Whether the holder and taker of the secret treat the information as secret.

54A competing principle to confidentiality is that of general know-how. Where information derives from a professional’s experience, knowledge, practice, or skill;or is commonly known within an industry, it is not confidential to another party.Put differently, information is not confidential when it derives from a professional’s techniques that are known in the field and could easily be duplicated by one with rudimentary skills in the trade. ²²

55Given the tension between confidentiality which is protected and know-how which is not, a party alleging misuse of confidential information must be “reasonably specific” in describing the information and why the information should be protected.²³ A complainant must do more than make bald, conclusory allegations that the defendants misused confidential information.²⁴ A defendant is entitled to know with particularity what specific information they are alleged to have misused. Descriptions of general categories or types of information will not suffice. ²⁵

56The question in this case revolves around whether the information at issue is confidential or falls under the heading of general know-how.

57The difficulty I have with the plaintiff’s allegations of confidentiality is that they are general in nature. Although Dymon alleges that various features of its properties are unique, they have not explained what is so unique about any of those features that take them outside of the realm of know-how and into the realm of confidentiality.

58Dymon tried to address this problem by submitting that it is not the feature but the “why” behind that feature that makes it confidential. In other words, it is the reasons for which Dymon did things that is confidential. Even then, however, I received no explanation for why Dymon did things in a particular way and why that was so different from its competitors that it should be confidential. Nor was there a specific explanation of how Edwards or NCA came to understand the “why” behind Dymon’s features that made it confidential, apart from having worked with Dymon for 4 or 11 years respectively.

59If knowledge about the general “why” of things could justify an injunction, it would be all too easy for any employer to restrain an employee or service provider by alleging that they know why the employer does things in a particular way. Most employees with a certain length of service and degree of insight will learn why an employer does things a particular way.

60In those circumstances the “why” would appear to be indistinguishable from general know-how that the employee or service provider obtained by virtue of the relationship. As noted, employees and service providers are permitted to use that general know-how for competitors even though it was acquired through an initial employer.

E. Confidentiality and Edwards

61Section 7 of Edwards’ employment agreement contained a broad confidentiality covenant which restrains her from using any information confidential to Dymon other than in connection with her employment with Dymon until that information was generally available to the public other than as a result of disclosure by her.

62Edwards denies that she shared any confidential information with SmartStop or anyone else. Dymon has not identified a single piece of information that Edwards has disclosed or otherwise misused.

63Dymon suggests that Edwards knew of the locations of future Dymon facilities and disclosed at least one of those, the Home Depot Eglinton site, to SmartStop. Paragraph 113 of Giller’s reply affidavit, states:

I am advised by Creighton that shortly after the meeting, he saw Edwards speaking privately with Jackson and Ms. Thom. It is not unreasonable to believe that Edwards had through CBRE, encouraged the termination of the Home Depot and DYMON deals and initiated negotiations between SmartStop and Home Depot.

64This “belief” was contrary to what happened. It was, in fact, Dymon who terminated negotiations with Home Depot because it was not prepared to live with the restrictions that Home Depot wanted to impose upon any provider of storage services. On October 11, 2019, Creighton (the person to whom Giller ultimately reported) wrote the following email to Home Depot:

After careful consideration, we have decided not to proceed with the agreements of purchase and sale. Our Dymon brand has become ubiquitous in Ottawa and is beginning to take hold in the GTA. Regrettably, we are concerned that the restrictions contemplated under the agreements will and have the further potential to negatively impact our Dymon brand. While we are absolutely convinced that Dymon is an ideal complementary operation to Home Depot, we simply cannot proceed with the uncertainty that the agreements present. We appreciate the time you have spent in attempting to come to acceptable terms and conditions. We wish you continued success in your business.

65Edwards received a copy of this email during the litigation in answer to an undertaking of Giller’s. Before receiving that email, Edwards had explained in her affidavit that CBRE had told her that Dymon had ended its relationship with Home Depot because it was not prepared to accept the limitations that Home Depot wished to place on Dymon, as a result of which CBRE, on behalf of Home Depot sought out other potential partners. After learning this, Edwards proposed the Home Depot location to SmartStop and retained NCA to prepare a design for it. The fact that Edwards’ explanation accords with contemporaneous documents of which she was not aware when she swore the affidavit gives her version of events credibility.

66SmartStop points to similarities between the designs that WPT proposed for Home Depot and the designs NCA prepared on behalf of Dymon. Dymon suggests that Edwards was somehow involved in sharing that design with Home Depot. Edwards denies that she did so and denies that SmartStop copied any of the Dymon designs. She says that the specifications were expressly stipulated by Home Depot. The project was located in one of Home Depot’s parking lots as a result of which Home Depot had specific requests about placement of the building, orientation, traffic patterns, size and building massing.

67Dymon’s architectural expert, Ron Possamai, stated during cross-examination that there were only so many ways to design and place a building on a particular site given the nature of client requests, operational requirements, and zoning/building code restraints. As a result, similar buildings can share similar designs.

68Dymon further suggests that it was the site selection process that was confidential and that Edwards, as Dymon’s Chief Planner, had detailed knowledge of that process and of Dymon’s future sites. Dymon has provided no evidence to demonstrate what, if any aspect, of the site selection process is confidential or how that allegedly confidential information as been misused.

69In an effort to demonstrate confidentiality, paragraph 92 of Giller’s affidavit describes Edwards’ role in the site selection process and in dealing with municipalities in that regard. His description is as follows:

92. Edwards was also the primary liaison between DYMON and all third-party stakeholders in the acquisition and planning process. In this regard, she was the "face" of DYMON and played a crucial role in implementing DYMON's expansion strategies. For example:

(a) Edwards represented DYMON at numerous municipal and public meetings and made presentations on DYMON's behalf. In addition, when DYMON began to make inroads in the Greater Toronto Region ("GTR"), Edwards was the "go-to" DYMON person from the perspective of various GTR municipalities and their planning departments;

(b) At the numerous municipal and public meetings that Edwards attended as DYMON's strategic representative, she made detailed presentations that included a comprehensive description of DYMON's vision to change the self-storage industry with its customer-focused emphasis. This was required because DYMON Centres were entirely unlike other competitors in the marketplace. To gain acceptance at municipal and public meetings, Edwards needed to change the preconceived notions that people had of self-storage facilities, and to get municipalities to allow DYMON to locate and develop its facilities in specific locations where self-storage facilities were not traditionally located. In advance, Messrs. Luckman and Creighton extensively trained and educated Edwards on DYMON's vision;

(c) Edwards became the primary contact with local municipalities for all application- related workstreams, including building permit applications;

(d) Edwards was heavily involved in liaising with brokers and other consultants in identifying potential properties for acquisition. She would then report her findings to DYMON's senior executives, CEO Glen Luckman and Senior Vice President Steve Creighton, for further investigation;

(e) Edwards worked very closely with DYMON's third-party planners and architects in evaluating potential new sites, designing site plans, overseeing the due diligence for land acquisitions and preparing site plan submissions, zoning by-law amendments and Official Plan amendments; and,

(f) Edwards coordinated the work of other consultants, including engineers, whose work was necessary for various municipal submissions.

70This paragraph highlights the shortcomings in Dymon’s case on confidentiality. Although it purports to provide details of confidentiality and give weight to the allegation, it ultimately provides no explanation for why information is confidential beyond making bald assertions about Dymon’s “vision to change the self storage industry” or that Dymon’s facilities were “entirely unlike other competitors.”

71Dymon provides no specifics about how they are unlike other competitors and provides no specifics to indicate why those differences rise to the level of confidentiality. When examined closely, the statements in paragraph 92 of Giller’s affidavit describe nothing more than general know-how that any employee in Edwards’ position would acquire in the course of their employment.

72Moreover, even if Edwards did know about future site locations and shared those with SmartStop, Giller admitted on cross-examination that the sites that Dymon was considering have changed in the three years since Edwards left the company.²⁶ As a result, an injunction at this point is unlikely to prevent any additional future harm.

73Dymon then submits that Edwards knew that WPT was hiding its true identity from NCA. In my view, that is not a basis for an injunction against Edwards. What NCA/WPT decided to disclose to Dymon is an issue as between NCA/WPT and Dymon. It is not Edwards’ responsibility to interpose herself into that relationship. While working for SmartStop under corporate and personal pseudonyms was not transparent on the part of NCA and is not a practice to be condoned, if that conduct breached a legal obligation on the part of NCA, damages are easily calculated as the fees NCA earned from Dymon between the time it began using the WPT name and the time Dymon discovered WPT’s true identity.²⁷

74Finally, while not determinative of any issue in the proceeding, Edwards’ new employment with agreement with SmartStop explicitly stated that Edwards was prohibited from disclosing to SmartStop any information confidential to her previous employers.

75For the foregoing reasons, Dymon has not made out a case for an injunction against Edwards even if I apply the lower serious issue to be tried to test.

F. NCA Confidentiality

76NCA signed a confidentiality and nondisclosure agreement as part of its relationship with Dymon pursuant to which NCA agreed to return to Dymon all confidential information after the termination of the relationship.

77Dymon submits that the respondents have refused to return confidential information and have used information confidential to Dymon on projects for SmartStop. Dymon notes that NCA is working approximately 26 SmartStop projects as a result of which any misuse of confidential information will be material.

78Shortly before the action began, Dymon wrote to NCA alleging that it had misused confidential information and demanding the return of all confidential information. The letter did not specify what information NCA had that was confidential. NCA responded asking for particulars of the confidential information. It received no response.

79On this motion, Dymon claims that NCA has information on the following issues which are confidential to Dymon: (i) the electrical distribution system that allows for quicker installation of electrical systems and a building automation system developed with its manufacturer, Prolon Inc, that allows app-based monitoring and control of temperature and humidity; (ii) certain elevator specifications; (iii) the drive-through feature; alternative code solutions; (iv) processes for achieving fire rating on exterior walls involving compartmentalization strategies for those walls; (v) the epoxy flooring system; (vi) specification books; (vii) architectural drawings.

80Dymon notes that none of the NCA defendants other than Caragianis swore affidavits denying their use of confidential information.

81Once again, however, the challenge with Dymon’s request for an injunction is the distinction between information that is truly confidential and information that forms part of general knowhow. It is for Dymon to establish that information is confidential and that it was mis-used.

82Giller fairly conceded during his cross-examination, that anyone with architectural and construction experience who spent enough time in one of Dymon’s facilities could learn almost all the design features.²⁸

83Possamai said during cross-examination that an architect would take what he has learned on one project and apply it to a subsequent project if it were appropriate to do so. The more unique a feature was, the more attention the architect would have to pay about reusing it.

84Possamai concludes his report as follows:

Finally, though not all the elements at (a) to (f) above are proprietary, those listed and others work together to form the unique and innovative DYMON brand design. When so many of them appear together in the same building, the experience and knowledge NCA gained from working for DYMON is obvious.

85The “elements in (a) to (f)” to which Possamai refers are the specific elements that are allegedly confidential as set out in paragraph 79 above and as discussed further below.

86What is significant about Possamai’s conclusion is that he does not allege improper copying to the point of breaching any duty of confidentiality but that the commonality of design features makes obvious “the experience and knowledge NCA gained from working for DYMON.” That, however, refers to general know-how. It is inevitable that and employee or a service provider will learn much when working for an employer. Going forward, that employee’s or service provider’s style will inevitably be influenced by the experience gained working for the previous employer. That is the essence of know-how. The law does not prohibit the use of that know-how. The law requires something more specific to demonstrate that the information that is being used goes beyond know-how and now rises to the level of confidentiality.

87In most cases, Dymon has failed to demonstrate that. Possamai states on some occasions that the feature is “proprietary.” That is a legal conclusion based on mixed questions of fact and law. Whether something is proprietary depends on the facts. Possamai’s report does not disclose what it is about any particular feature that makes it proprietary or confidential.

88I turn then to the individual features that Dymon alleges are confidential.

(i) Electrical Distribution System

89Possamai says he is unable to comment about the confidentiality or uniqueness of the electrical distribution system because it is not an architectural item. Dymon has not given other particulars of that system that would make it confidential. Possamai is silent with respect to the related app-based temperature and humidity control mechanism. Dymon asserts that this app was “developed with its manufacturer, Prolon Inc.” Dymon provides no particulars on how this app differs from any conventional Prolon product or any other app-based temperature and humidity control mechanism.

(ii) Elevator Design

90Dymon makes several allegations with respect to elevator design.

91First, Dymon alleges that NCA had access to “elevator specifications including weight, capacity, speed and materials which provide maximum efficiency, reduced maintenance, longer lifespan and improve customer experience.” Possamai does not comment on any of those specifications. Dymon provides no details about what it is about any of those specifications that are confidential to Dymon or that differ from the specifications competitors use to such a degree that it would make the information confidential.

92Second, Dymon highlights its use of push through elevators. A push through elevator is one with a door on either both sides of the elevator on every floor or a door on one side of the elevator on the entry floor and on the opposite side on the exit floors thereby allowing the customer to “push through” whatever load is being transported.

93The concept of a push through elevator is not unique to Dymon. They are used commonly in hospitals and airports.

94Possamai states that while the idea of a push through elevator is “not technically proprietary,” he notes that SmartStop’s initial drawings for its Taunton Road site did not include push through elevators while the plans prepared by WPT did. However, SmartStop did use a push through elevator design in at least one of its other locations before it hired WPT.

95Third, Dymon submits that SmartStop copied its idea of waterproofing the interior of the elevator pit. Possamai described waterproofing the inside of an elevator pit as “not so typical.” This could mean that either 49% of plans have them or .1% of plans have them. Possamai agreed on cross-examination that an architect would waterproof the interior of an elevator pit (as opposed to merely the exterior) if it were wise and prudent to do so.

96Possamai also noted that WPT’s drawings for SmartStop’s Taunton Road site “features the exact same detail as is used in the Dymon Centres elevator pit wall” and that the drawings would not be immediately available to those not involved in Dymon’s project.

97It was unclear on the evidence before me who prepared the drawings of the elevator pit. It appears that architectural drawings related to “Dymon’s aesthetic design” were prepared by Tact Architecture Inc. pursuant to an agreement that gave Dymon copyright in the designs. It is not clear to me whether the elevator pit drawings were prepared by Tact or by NCA.

98It strikes me that, although waterproofing elevator pits is part of an architect’s general know-how, WPT does appear to have had at least a springboard in its ability to copy a design prepared for Dymon. In my view is entitled to that springboard if NCA prepared the elevator pit design. In that case, the design belongs to NCA and can be used on other projects as part of its general know-how. WPT is not entitled to that springboard if Tact prepared those designs. Dymon has not, however, established that the elevator pit was designed by someone other than NCA.

(iii) The Drive-Through Feature

99The drive-through refers to a feature that permits a customer to drive into the interior of a Dymon Centre, unload items to be stored and drive out of the other end of the centre when the customer is finished.

100Drive-through features are not uncommon in the self storage industry. Giller acknowledged several examples of drive-throughs in self storage facilities that were unrelated to Dymon, NCA or WPT.

101That said, SmartStop’s initial design for Home Depot’s Eglinton Ave. site did not have a drive-through feature. The plan prepared by WPT did.

102According to the respondents, it was Home Depot that required a drive-through feature. Giller agreed on cross-examination that there was nothing preventing Home Depot from asking its new architects to incorporate a drive-through feature.

103It may be that having access to the Dymon proposal for Home Depot gave WPT an unfair springboard advantage. Whether that is the case depends again on who prepared the initial drawings for Dymon.

104Dymon then submitted that it was the very specific dimensions of the drive-through that were confidential and unique to Dymon. I note that Dymon provided no details about the alleged uniqueness of the dimensions and note that Possamai offered no opinion in this regard.

(iv) Alternative Code Solutions

105Alternative Code Solutions are essentially workarounds that owners and architects negotiate with local municipalities to avoid the strict requirements of local building codes or zoning bylaws. They involve a process of making submissions to a municipality to demonstrate that the proposed design, although it may depart from the strict letter of the building code or a zoning bylaw, should nevertheless be acceptable.

106Possamai stated in his report that while the process of obtaining an Alternative Code Solution is not unique the “way it is applied to foster certain creative ways around what may be overly rigid building code regulations can be.”

107Possamai then referred to an Alternative Code Solution for one internal drive-through as follows:

While the process used to achieve this was not proprietary, it is reasonable to conclude that the concept and idea are. Dymon has significant investments in exploring various AS concepts such as marrying occupancies within the building that under normal circumstances are prohibited by the OBC. An example of this would be combining a C residential occupancy with the F 2 storage designation in Dymon’s proposed Yorkdale project.

108Several points emerge from this. First, there is no evidence before me to suggest that anyone is copying the combination of residential occupancy and storage designation in Dymon’s proposed Yorkdale project. Second, even then, there is no description of what it is in the alternative solution arrived at for Yorkdale that is confidential. Even Possamai’s statement here is more of a bald conclusion than a reasoned opinion based on a set of underlying facts.

109Reference was also made during oral argument to another Alternative Code Solution for a drive-through feature that amounted to a 35-page technical document. It did not immediately succeed with the cities of Brampton or Ottawa and required several go- rounds of discussions before being approved. Once again, I was not given any details of why that solution was confidential.

110If something were truly confidential, I would expect to see something directionally in the nature of sealed materials, perhaps for counsel’s and experts’ eyes only, that explained why the alternative solution arrived at is confidential.

(v) Epoxy Flooring System

111The parties did seem to agree that at least one aspect of work that NCA did for Dymon, the use of an epoxy floor solution, amounted to confidential information that was disclosed to SmartStop. NCA says it was disclosed inadvertently, was subsequently removed, and was never used in a SmartStop application.

(vi) Plans and Specification Books

112Dymon also notes that it had prepared plans for a site on the Home Depot Eglinton Site which it alleges were substantially reproduced by WPT when it began working for SmartStop on that site.

113WPT also prepared designs for the SmartStop Whitby Site. Prishram Jain from Tact Architecture who prepared the exterior Dymon design stated that, “the similarities [between his design and the WPT design] are too significant to ignore.”

114However, Possamai also noted significant similarities between three SmartStop projects and Dymon projects with which the respondents were not involved.²⁹

115As noted, there is uncertainty in the evidence about who prepared those plans. Certain aesthetic plans were prepared by Tact Architecture Inc. pursuant to an agreement that gives Dymon the copyright to those plans. NCA does not appear to have any such arrangement with Dymon as a result of which, if NCA prepared the plans, copyright would, prima facie, belong to NCA.³⁰

116There was also evidence about specification books. These are lengthy manuals of approximately 900 pages that deal with the detailed specifications of a particular project. Caragianis explained the specifications as follows:

A specification is a program. It belongs to the architect. An architect, through their intellect, experience and so forth, prepares a specification as it applies to a specific client. And yes, it would be very similar because a majority of all construction elements and techniques are the same. We have a subscription to an outside provider for the specification in which we use the same for all our projects…. We would use the same specifications for the same materials for projects.

117It appears that at least one of the specification books also contained specifications about the epoxy floor system which Caragianis agrees is confidential. It therefore appears that certain portions of a specification book may belong to the architect while other portions may belong to a client if they contain information confidential to the client.

118I was given no further detail by either side about the contents of the specification books or the delineation of confidential or nonconfidential materials within them.

G. Irreparable Harm

119Dymon submits that demonstrating irreparable harm is a low threshold and points to authorities saying:

i. Doubt about whether damages would be an inadequate remedy demonstrates irreparable harm.³¹

ii. The loss of actual and potential customers, goodwill and market share all qualify as “irreparable harm.”³²

iii. If the “alleged misuse of confidential information relates to business or financial information, the preponderance of the jurisprudence provides that irreparable harm is presumed.”³³

iv. A breach of a negative covenant raises a “presumption of irreparable harm.”³⁴

120I also appreciate that Dymon will not be able to point to any actual loss of customers or market share so far because the SmartStop competitive facilities that are alleged to benefit from the misuse of confidential information are not yet open. It is noteworthy in this regard, however, that Giller stated during cross-examination that Dymon continued its planning for future facilities and that there was nothing involved in this action preventing Dymon from doing so.

121If there were misuse of confidential information here, I would be prepared to conclude that Dymon would suffer irreparable harm from its use because it would likely result in loss of actual and potential customers, goodwill, and market share.

H. The Balance of Convenience

122The balance of convenience requires the court to assess whether the respondents will suffer more harm if the injunction is granted than the plaintiffs will suffer if the injunction is not granted.

123A restraint on competing with Dymon would prevent the defendants from working in the self storage business even in the absence of an enforceable noncompetition covenant. Refusing to grant the injunction simply puts Dymon into the legal position vis-à-vis competition that it was already in. The balance of convenience therefore strongly favours the defendants.

124The balance of convenience is different when it comes to misuse of confidential information. Prohibiting the defendants from misusing confidential information causes them no harm. It simply puts them into the legal position that they are supposed to be in in any event. Allowing them to use confidential information is prejudicial to the plaintiff. The balance of convenience therefore favours the plaintiff in this regard.

125The real issue here is what amounts to confidential information. An injunction enjoining misuse of confidential information is not especially helpful without a definition of what is confidential.

Remedy

126As noted earlier, I decline to issue any anticompetitive injunction against any of the defendants.

127Although all defendants are precluded from misusing confidential information, I decline to issue a broad injunction in that regard because of the inadequate particularization of confidential information and the failure to demonstrate even a serious issue to be tried with respect to any alleged misuse of confidential information by Edwards.

128The situation may be slightly different with respect to the remaining defendants. In that regard I require the remaining defendants to surrender to Dymon any architectural drawings or plans relating to Dymon storage facilities that were not prepared by NCA and that NCA has not obtained from a public source. It strikes me that, on the evidence before me, NCA has no copyright or title to those materials. Those drawings give NCA/WPT a springboard advantage to which they are not entitled.

129I have struggled somewhat with the issue of the specification books. It appears that at least some of the material in those specification books may be confidential, such as information relating to the epoxy floor system. I therefore order the defendants to surrender to the plaintiff all materials relating to the epoxy floor system. In the absence of any further definition to demonstrate the confidentiality of materials in the specification books, I decline to make any further award. That is not, however, to say that the specification books do not contain further confidential information, but that merely that the plaintiff has not satisfied me that a general order should be granted in this regard. I reach that conclusion because of the combination of the lack of evidence that specifically identifies confidential information in the specification books and the fact that the balance of convenience would strongly favour the defendants with respect to information in those specification books that is not confidential. I come to the same conclusion for the same reasons with respect to the Alternative Code Solutions.

130All of that said, the NCA/WPT defendants would be well advised to comb the specification books and segregate and/or surrender any information in them that is confidential. Failure to do so may result in liability at the end of trial which could be easily avoided.

I. The Motion to Strike

131Edwards moves to strike the claim as disclosing no cause of action against her on the ground that she was not employed by Dymon but was employed by one of its affiliates. I do not find this to be a valid basis for dismissing the claim against her. Paragraph 3 of her employment agreement required her to provide services to affiliates as necessary. Moreover, Dymon moves, if necessary, to amend its statement of claim to join additional affiliates as plaintiffs. It does so in response to Edwards’ motion to strike the claim on the grounds that it had no employment relationship with the currently named plaintiff.

132Courts are required to grant leave to amend pleadings unless the amendment causes prejudice to the opposing side that cannot be compensated for by costs or an adjournment.³⁵

133Edwards has raised no such prejudice. I would therefore allow the amendment if necessary. In my view the amendment is probably academic at this stage given that I have stayed the claim in favour of arbitration

J. The Motion to Stay in Favour of Arbitration

134Edwards further moves to stay the claim against her on the basis that her employment agreement calls for arbitration of this dispute. Section 18 of her employment agreement provides:

Any issues arising out of the application, interpretation or administration of this Agreement shall be determined by final and binding arbitration pursuant to the Arbitration Act, 1991. …

135Dymon focuses on the language that sends to arbitration “issues arising out of the application, interpretation or administration of this Agreement.” Dymon submits that courts have read such language more restrictively than language that refers to arbitration “all issues arising out of the employment relationship.” Dymon relies on two cases in support of this proposition. In my view both are distinguishable.

136The first case is Campbell v Baldwin Agency Security & Investigations Inc.³⁶ In Campbell, an employer hired an investigation agency to conduct an undercover investigation of its employees. As a result of the investigation, 27 employees were terminated. All employees were subject to a collective agreement which was subject to the regime established in the Labour Relations Act.³⁷ Section 48 of that act provides that every collective agreement shall provide for final and binding settlement by arbitration of all differences arising from the “interpretation, application, administration or alleged violation” of the collective agreement.

137Dymon argues that in Campbell the court focused on the words “interpretation, application and administration” to take a narrow view of what was referred to arbitration and concluded that the claim belonged in the courts, not before of an arbitrator.

138I read Campbell differently. The plaintiff in Campbell was one of the dismissed employees. He and all the other dismissed employees grieved their dismissal before an arbitrator. The claim before the court did not contest the dismissal but was a claim against the private detectives that conducted the undercover investigation. The detective agency was not subject to the collective agreement and, as a result, was not subject to the jurisdiction of the Labour Relations Act or the arbitral regime it created.³⁸

139The second case on which Dymon relies is Piko v Hudson’s Bay Co.³⁹ Piko also involved a claim by an employee who was subject to a collective agreement. Her employment was terminated for alleged fraud. In addition, her employer initiated a criminal prosecution against her. On the date of her criminal trial, the Crown withdrew the charges against her. Approximately one year after her employment was terminated, Piko grieved her termination. The arbitrator dismissed the grievance because it was not filed in time and because Piko had not given a reasonable explanation for her delay.⁴⁰

140Piko then brought an action against her employer for malicious prosecution and damages for mental distress caused by the criminal proceedings. The Court of Appeal allowed the claim to proceed before the courts explaining:

But her claim that the Bay maliciously prosecuted her in the criminal courts lies outside the scope of the collective agreement. The Bay itself went outside the collective bargaining regime when it resorted to the criminal process. Once it took its dispute with Piko to the criminal courts, the dispute was no longer just a labour relations dispute. Having gone outside the collective bargaining regime, the Bay cannot turn around and take refuge in the collective agreement when it is sued for maliciously instituting criminal proceedings against Piko.⁴¹

141In my view, the reasoning more apposite to this case is that found in the Ontario Court of Appeal’s decision in Haas v. Gunasekaram.⁴² In Haas, the Court of Appeal noted that the law favours giving effect to arbitration agreements. The court observed that this policy direction was reinforced by section 17 of the Arbitration Act⁴³ which gives the arbitral tribunal the power to rule on its own jurisdiction. The court went on to note that this “pro-arbitration orientation” was supported by the Supreme Court of Canada in Dell Computer Corp. v. Union des consommateurs,⁴⁴ where Deschamps J. said, writing for the majority:

I would lay down a general rule that in any case involving an arbitration clause, a challenge to the arbitrator’s jurisdiction must be resolved first by the arbitrator.

142The Court of Appeal then went further to say that in cases where it was unclear whether an arbitrator has jurisdiction, it was preferable to leave that issue to the arbitrator pursuant to the competence-competence principle.⁴⁵ Thus, where it was arguable that the dispute falls within the terms of the arbitration agreement, it should be left to the arbitrator to determine that issue. It was only in cases where a dispute clearly falls outside of the terms of the arbitration agreement that the court should determine the issue.⁴⁶

143There is here, at the very least, an arguable issue that the claim against Edwards falls within the scope of the arbitration agreement. I would therefore stay the action against her in favour of arbitration. If Dymon maintains a challenge to the arbitration, it should be raised before, and resolved by, the arbitrator.

144Given that I have stayed the claim against Edwards in favour of arbitration, I decline to address her motion to strike the claim as disclosing no cause of action. It would be preferable for the arbitrator to make that determination based on the form of any arbitral claim made to him or her and in accordance with any rules he or she finds applicable to the arbitration.

Conclusion

145For the reasons set out above I:

i. Dismiss the motion for an injunction against Edwards.

ii. Order the remaining defendants to surrender to Dymon all copies of documents relating to the Epoxy floor system and all copies in their possession of architectural drawings or designs for Dymon facilities that were not prepared by NCA or its employees. The motion is otherwise dismissed as against the remaining defendants.

iii. Stay the claim against Edwards and direct that any claim against her should proceed to arbitration.

iv. If necessary, grant the plaintiff leave to amend the statement of claim in the to add as plaintiffs; Dymon Storage (Ottawa) Corporation and Dymon Management Services Inc.

146Any party seeking costs of this motion may make submissions by sending them to my judicial assistant within 14 days of the release of these reasons. Any responding submissions should be delivered within 10 days of receipt of the initial submissions. Any reply should be delivered within 5 days after receipt of responding submissions.

Koehnen J.

Footnotes

1. 1Essentially work arounds to zoning or building code restrictions.
2. 2RJR – MacDonald Inc v Canada (Attorney General), 1994 117 (SCC), [1994] 1 SCR 311, 1994 CarswellQue 120 (SCC) at para 48.
3. 3FLS Transportation Services Inc. v Charger Logistics Inc., 2016 ONSC 3652 at para 18 [FLS], BOA, Tab; 2158124 Ontario Inc. v. Pitton, 2017 ONSC 411 at para 33; Camino Modular Systems Inc. v. Kranidis, 2019 ONSC 7437 at para. 21.
4. 4R v Canadian Broadcasting Corp., 2018 SCC 5 at para 15; See also: 1711811 Ontario Ltd. (AdLine) v Buckley Insurance Brokers Ltd., 2014 ONCA 125 at para 57; Panahiannigjeh v Vosoughian, 2022 ONSC 5298 at para 48.
5. 5Canadian Broadcasting, supra note 141 at para 16.
6. 6Boni v Leonardo Worldwide Corporation, 2018 ONSC 1875 at paras 30-32, citing Shipka v Trevoy, 2012 ABQB 416 at para 22.
7. 7Frame v. Smith, 1987 74 (SCC), [1987] 2 S.C.R. 99, Lac Minerals Ltd. v. International Corona Resources Ltd., 1989 34 (SCC), [1989] 2 SCR 574
8. 8Working for Workers Act, 2021, S.O. 2021, c. 35
9. 9Parekh et al v. Schecter et al, 2022 ONSC 302 at paras. 45-47.
10. 10M & P Drug Mart Inc. v. Norton, 2022 ONCA 398 at para 32
11. 11Shafron v. KRG Insurance Brokers (Western) Inc., 2009 SCC 6 at paras 15-17
12. 12Martin v. ConCreate USL Limited Partnership, 2013 ONCA 72; Norton, at para 35,.
13. 13Martin, at para 54, RBOA, Tab 7.
14. 14Shafron, at para 26, RBOA, Tab 6; Norton.
15. 15Shafron, at para 47, RBOA, Tab 6; Norton, at para 38..
16. 161003126 Ontario Ltd. v. DiCarlo, 2013 ONSC 278 at para 25.
17. 17CPC International Inc. v. Seaforth Creamery Inc., 1996 8188 (ON SC) at para. 22
18. 18Matrox Electronic Systems Ltd. v. Gaudreau, [1993] Q.J. No. 1228 (S.C.J.)
19. 19Matrox Electronic Systems Ltd. v. Gaudreau, [1993] Q.J. No. 1228 (S.C.J.), at paragraph 83 adopted in GasTOPS Ltd. v. Forsyth, 2009 66153 (ON SC) at para. 123. See also: 6 Sateri (Shanghai) Management Limited v Vinall, 2017 BCSC 491 at paras 475-476, Chang at paras 502-503; Stonetile (Canada) Ltd v Castcon Ltd, 2010 ABQB 392 at paras 63, 65.
20. 20Omega Digital Data Inc v Airos Technology Inc (1996), 1996 11785 (ON SC), 32 OR (3d) 21 (Ct J) at para. 22.
21. 21Brand Name Marketing Inc v Rogers Communications Inc (2017), 2016 ONSC 4567 at para 219.
22. 22Sateri (Shanghai) Management Ltd. v Vinall, 2017 BCSC 491 at para 466. See also, Julie A. Thorburn & Keith G. Fairbairn, Law of Confidential Business Information (Toronto: Thomson Reuters Canada Limited, 1998) (loose-leaf updated 2022), ch 6. ; Camino Modular Systems Inc. v. Kranidis, 2019 ONSC 7437; Cradle Pictures (Canada) Ltd. v. Penner (No. 2), 1977 CarswellOnt 648 (Ont. Supreme Court) at para 29
23. 23Julie A. Thorburn & Keith G. Fairbairn, Law of Confidential Business Information (Toronto: Thomson Reuters Canada Limited, 1998) (loose-leaf updated 2022), ch 4, RBOA, Tab 18.
24. 24Evertz Technologies Limited v. Lawo AG, 2019 ONSC 1355.
25. 25Evertz, at para 32-33.
26. 26Giller Cross, qq 441-44, pp 122-23, SMR, Vol 6, Tab 9, pp 2936-37.
27. 27Given that there is no enforceable noncompetition covenant, the damages would flow from Dymon’s inability to have terminated the relationship as soon as WPT began work for SmartStop.
28. 28Giller Cross, 267-81, 80-83, SMR, Vol 6, Tab 9, pp 2894-97.
29. 29600 Fox Street, 9910 Airport Road and 801 Milner Avenue
30. 301246798 Ontario Inc. v Sterling, 2000 CarswellOnt 4023 (ONSC Div. Ct.), at para 22.
31. 31MacMillan Bloedel Ltd v Mullin (1985), 1985 154 (BC CA), 61 BCLR 145 at para 97 (CA); International Steel Services Inc. v. Dynatec Madagascar S.A., 2016 ONSC 2810 at paras 51-52,
32. 321259695 Ontario Inc v Guinchard (2005), 139 ACWS (3d) 561 at para 64 (Ont Sup Ct J); Vector at para 42,
33. 33TAPS Media Inc v Canadian Craft Brewers Association et al, 2022 ONSC 960 at para 59
34. 34Singh v 3829537 Canada Inc (2005), 140 ACWS (3d) 162 at para 60 (Ont Sup Ct J)
35. 35Andersen Consulting v Canada (Attorney General) (2001), 2001 8587 (ON CA), 107 ACWS (3d) 759 at para 37; Health Genetic Center Corp v New Scientist Magazine, 2018 ONSC 3675 at paras 7-10.
36. 36Campbell v Baldwin Agency Security & Investigations Inc (1999), 93 ACWS (3d) 276 (Ont Sup Ct J)
37. 37(1995) S. O. 1995, c. 1, Schedule A
38. 38See Campbell paragraphs 2, 2 and 13.
39. 39Piko v Hudson’s Bay Co (1998), 1998 6874 (ON CA), 41 OR (3d) 729 (CA)
40. 40Pico at para. 5.
41. 41Pico at paragraph. 17.
42. 42Haas v. Gunasekaram, 2016 ONCA 744
43. 43Arbitration Act, R. S. O. 1990, c. A. 24
44. 44Dell Computer Corp. v. Union des consommateurs, 2007 SCC 34, [2007] 2 S.C.R. 801 at para. 84
45. 45Haas at para. 15. That is to say that the arbitrator has competence (jurisdiction) to determine his or her competence (jurisdiction).
46. 46Haas at para. 15 quoting Sharpe J. in Dancap Productions Inc. v. Key Brand Entertainment, Inc., 2009 ONCA 135, 246 O.A.C. 226, at paras. 32-33.