Court File and Parties

COURT FILE NO.: CV-20-639516-00CL DATE: 20230119 SUPERIOR COURT OF JUSTICE – ONTARIO (COMMERCIAL LIST)

RE: Yuk Shing Kan, Plaintiff AND Yuk-Sum Kan, Kam-Yuk Chu, 1078063 Ontario Limited and 1585700 Ontario Inc., Defendants

AND

RE: Yuk-Sum Kan, Plaintiff by Counterclaim AND Yuk Shing Kan, Defendant by Counterclaim

BEFORE: Osborne J.

COUNSEL: Stephen Roger Barbier and Ben Tustain, for the Plaintiff, Defendant by Counterclaim Jeffrey Radnoff, for the Defendants and Plaintiff by Counterclaim

HEARD: January 19, 2023

Endorsement

[1] This is a motion by the Defendants (one of whom is also the Plaintiff by Counterclaim) for partial summary judgment dismissing some, but not all, of the claims advanced against them in this action. Specifically, those parties seek an order dismissing those (and only those) claims of the Plaintiff that are:

(a) statute barred by the expiry of a limitation period, because they were discovered or discoverable more than two years before the claim was issued; and

(b) based on an alleged oral trust agreement, because such an agreement is inconsistent with the conduct of the parties and other objective evidence of events that occurred over a period of approximately 25 years.

[2] For the reasons that follow, the motion for partial summary judgment is dismissed.

The Parties

[3] The Defendants are Yuk-Sum Kan (”Sum”), Kam-Yuk Chu (”Chu”), 1078063 Ontario Limited (”107”) and 1585700 Ontario Inc. (”158”). Sum is also the Plaintiff by Counterclaim. Sum and Chu are Ontario residents.

[4] The Plaintiff, Defendant by Counterclaim, is Yuk Shing Kan (“Shing”). Shing is a resident of Hong Kong.

[5] Shing and Sum are brothers. Chu is Sum’s wife.

[6] 107 is an Ontario corporation legally owned as to 51 percent by Sum, and as to the remaining 49 percent by Shing. Each of Shing, Sum and Chu is a director of 107, together with Gloria Yin Ha Chui (”Gloria”). Gloria is Shing’s wife. Sum and Shing are the President and Vice President respectively of 107.

[7] 158 is an Ontario corporation operating as a real estate holding company owned by Sum, Chu and/or 107. Sum and Chu are the registered directors and officers. 158 owns one of the properties (460 Main St. W., Hamilton, ON) that the Plaintiff alleges was purchased by or on behalf of the Defendants with misappropriated funds.

Facts

In A Nutshell

[8] In short, 107 owns property in Canada. The claim centres around the issue of whether the 51 percent of the shares in 107 legally owned by Sum, and the shares in 158 legally owned by Sum and Chu (or the assets of 158), are in fact held in trust for Shing.

[9] Shing’s principal claim in the action is that Sum and Chu (Shing’s brother and his brother’s wife) hold their shares in both companies in trust for him. He alleges that there was an oral trust agreement, or in the alternative there is a resulting or constructive trust and that the Defendants breached their fiduciary duties he claims were owed to him.

[10] Sum and Chu deny that there is any trust (oral, constructive or resulting) and maintain that they own their respective shares in 107 and 158 (or, in the case of 158, the assets thereof) for themselves beneficially as well as legally.

[11] In his counterclaim, Sum seeks an accounting of profits and distributions, disclosure of all information relating to properties jointly owned by him and Shing, and various other relief.

[12] All allegations, going in both directions, are vigourously disputed.

[13] Given the commonality of surname, I have referred to the parties by their first names.

1995 - 2019

[14] The relevant facts go back to 1995, or earlier. On June 2, 1995, the accountant for 107 at the time sent to Shing by fax a copy of financial statements for the period ending March 31, 1995, and a reporting letter. That reporting letter stated that 107 had rental income of $129,840 and also that Sum had taken a management fee of $30,000 for that year.

[15] The evidence shows that Shing acknowledged receipt of these materials. The moving parties rely on this faxed material as evidence that, as early as June, 1995, Shing was well aware both that 107 had earned income and that Sum had taken a management fee in the amounts stated, well in excess of that agreed.

[16] Shing never raised any objections or disputed these financial statements until approximately 2019.

[17] The moving parties rely on the fact that, pursuant to the constating documents of 107, Shing had the right as an officer (Vice President) and a shareholder to request financial information at any time, yet he failed to do so for approximately 25 years. That theme permeates the argument and positions of the moving parties on this motion.

[18] For his part, Shing takes the position that he benevolently helped his brother and sister‑in‑law as then recent immigrants to Canada. It was not exclusively altruistic, he readily concedes, in that the political uncertainty in Hong Kong during the 1990s caused him to want to invest in Canadian real estate for his own benefit. He did this, he maintains, through 107, which was intended by the parties to be the holding company for his Canadian real estate investments.

[19] Shing maintains that Sum’s holding of 50 percent of the shares in trust for him came about as a result of Sum having persuaded him of the benefits of an oral trust agreement. His agreement to assist his brother and his brother’s wife, and his trust and confidence in his brother to look after his own Canadian investments in trust for him, were abused, Shing maintains, in that his brother and his brother’s wife took advantage and redirected material amounts of 107’s rental income and equity for their own benefit.

[20] Shing alleges that these funds were used for the acquisition of what is now a very substantial real estate portfolio owned by Sum and Chu, the genesis of which is otherwise inexplicable.

[21] As noted, 107 and 158 own property in Canada. Most of the allegations in the claim involve 107. 107 purchased a commercial property at 2574 Yonge St., Toronto (“2574 Yonge”) on April 30, 1994, for a purchase price of $2,135,000.

[22] Of that purchase price, $916,322.24 was paid in cash and the balance of the purchase price was satisfied through an RBC mortgage for $120,000 and a private mortgage from Bloet Investment Limited in the amount of $1,200,000.

[23] The moving parties emphasize that Sum (and not Shing) guaranteed those mortgages.

[24] The moving parties also argue that Shing showed no interest in, nor asked any questions regarding, 107 until October 2019 and that in the intervening period since the spring of 1995 until late 2019, Sum and Chu had spoken with Shing about 107 on two occasions only: when Shing visited Toronto in 1999 and again in 2008.

[25] However, the relationship began to unravel in 2019, and particularly in the period after Shing began making inquiries into the investments, resulting in this action.

2019 Allegations

[26] On July 19, 2019, Shing alleged (for the first time, according to the moving parties) that he beneficially owned all of the shares of 107 pursuant to a trust agreement.

[27] Shing reiterated this position, with more particulars, by correspondence from his lawyer dated October 4, 2019, by which Shing’s counsel demanded financial information about 107 and specifically alleged that the 51 percent of the shares of 107 legally held by Sum, were in fact beneficially owned by him (Shing) pursuant to an oral trust agreement.

[28] Shing alleged that Sum was obligated to manage 107 in accordance with instructions from Shing including but not limited to the management and deployment of all capital funds that Shing advanced. The rental income from 2574 Yonge was to be used strictly to service the mortgage debt and expenses, and as the mortgage on 2574 Yonge was paid down, the rental income of 107 was to be utilized to purchase additional investment properties.

[29] Shing agrees that Sum was permitted to pay himself a reasonable management fee from the income of 107, but only if 107’s net income after expenses and taxes, was sufficient. Shing’s position was in October 2019, and is today, that Sum and Chu have misappropriated assets of 107 as they drew money from the company far in excess of that which they were permitted to take.

[30] Shing also alleges that one of the properties owned by 158 in Hamilton, Ontario was purchased with funds misappropriated from 107, with the result that either the shares of 158, or the assets owned by the company, are held in trust for him.

[31] For his part, Sum asserts that the original capital for investment in 107 came not from Shing, but rather from their mother and/or a family business owned by their parents in Hong Kong.

[32] One complicating feature of this motion is the fact that the mother of Shing and Sum is agreed by all parties to be key to this fundamental dispute about the source of the original funds, but unfortunately died in 2011. Shing agrees that his mother would have been a very relevant witness to his claim. Sum and Chu argue that they are prejudiced by Shing bringing this action some nine years after their mother’s death since they are unable to adduce relevant evidence from her.

[33] They also argue that the delay in bringing this action has prevented them from providing a complete accounting for 107 going back to 1994, since they now have records only back to 2013.

[34] Shing denies that the funds advanced through him were in fact from their mother, or that the family business generated sufficient income to be material in any event. Shing maintains that he transferred $1,577,000 to Canada to assist his younger brother, who had not been as financially successful as had he.

[35] The moving parties state that in November 2019, and only weeks after the demand from Shing’s lawyer, they provided financial statements and notices of assessment for 107, observing again that such were available to Shing at any time upon request.

[36] The moving parties deny the existence of any oral trust agreement, and argue that such is inconsistent with the objective evidence primarily relating to the conduct of Shing over the relevant 25-year period. In addition to the absence of any written instrument, they argue that the alleged oral trust agreement is inconsistent with the corporate documents, the 1995 financial statement received by Shing at the time, his lack of interest in the company for 25 years, two letters from Shing’s lawyer in Hong Kong (dated April 2, 2019 and December 30, 2019 respectively, each of which refers to “joint assets”), and a 2010 loan agreement.

[37] The 2010 loan agreement was signed by Shing and, according to the moving parties, effects the transfer by Shing of his portion of the shareholder loan account in 107 to Sum, so that Sum could withdraw funds from the company. They argue that such is inconsistent with the position that 107 is beneficially owned by Shing exclusively. Shing denies signing this document.

[38] The moving parties observe that none of the material obtained by Shing pursuant to the Mareva order granted earlier in this proceeding by Gilmore J. (and discussed below), is now relied upon him to calculate his damages.

[39] Shing relies, for the purposes of this motion, on the continued refusal of the moving parties to produce their own personal income tax returns or notices of assessment, or to fully answer all of the requests made by the forensic accountant (further discussed below) who has produced only a preliminary report.

[40] In the main, he argues that these refusals should form the basis of an adverse inference drawn against the moving parties as to their assets and sources of income to purchase their own extensive real estate portfolio. Shing alleges in the action that these properties were purchased with funds misappropriated from him or 107.

[41] As noted above, Shing further pleads that even if the evidence does not establish an oral trust agreement, Sum and Chu have breached their fiduciary duties and hold assets for him by way of resulting or constructive trust.

Procedural History and Earlier findings and Orders

[42] On April 30, 2020, Shing moved ex parte and on an urgent basis for Mareva and Norwich orders related to the real and personal property of the Defendants. The material filed was, as observed by the motions judge, Gilmore J., both voluminous and detailed. Justice Gilmore was satisfied on the basis of the material filed that there was evidence that Sum and Chu had mismanaged 107 in a manner oppressive to Shing’s interest as a shareholder and director, and in violation of the alleged oral trust agreement. The orders sought were granted.

[43] On May 19, 2020, Gilmore J. heard the motion of Sum and Chu to set aside the April 30 orders on the basis that:

(a) Shing had not made full and fair disclosure of all facts;

(b) the evidence on the original motion did not meet the required evidentiary threshold of a strong prima facie case; and

(c) Shing did not have clean hands as he was attempting to enforce a trust agreement, one of the purposes of which was to avoid paying taxes in Canada.

[44] In her Endorsement dated June 3, 2020, the motions judge set aside the April 30 orders, finding both that the ex parte materials did not fully and fairly disclose all relevant facts, and that there was contradictory and insufficient evidence such that the motions judge was unable to conclude that Shing had a strong prima facie case (as interpreted by the Supreme Court of Canada in R. v. Canadian Broadcasting Corp., 2018 SCC 5, [2018] 1 S.C.R. 196, to mean that the applicant will ultimately be successful in proving the allegations set out in the originating notice (Endorsement, at paras. 22 and 40 – 48)).

[45] The motions judge also found, however, that there were serious concerns raised by Shing that must be addressed, with the result that while she set aside the April 30 orders, the motions judge made a new order prohibiting any further encumbering of the current assets of 107 except by court order or special resolution, and restrained the Defendants from encumbering or disposing of any property in their names pending further court order.

[46] The motions judge directed that Shing could engage the services of a certified forensic accountant, and the Defendants were required to provide access to all documents and information. As further discussed below, that forensic accountant (Mr. Peter Macaulay) was subsequently retained and has provided a preliminary report filed on this motion.

[47] The reasons of the motions judge are informative.

[48] Justice Gilmore found that Shing ought to have, but failed to, disclose in the ex parte materials and submissions various facts and documents.

[49] The motions judge found that the issues and law surrounding the applicable limitation period, including but not limited to the exemption found in the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B (the “Limitations Act”), for s. 4 of the Real Property Limitations Act, R.S.O. 1990, c. L.15 (the “RPLA”) which establishes a 10-year limitation period for a proceeding to recover land, as well as the fact that that has been interpreted to apply to claims of a constructive trust over land, all ought to have been disclosed.

[50] The motions judge, at para. 27, noted that: “while Shing provides cogent reasons why there should not be a limitation period applied to his claim, it is this Court’s view that those reasons should have been set out in his materials and the issue of any possible limitation period addressed.”

[51] Moreover, at para. 43, the motions judge found that even following a determination of whether a two‑year or a 15-year limitation period applied, there were also factual issues applicable to the limitation period analysis in any event:

The Court would have to accept that Shing’s alleged lack of interest in his investments related to his faith that his brother was abiding by the Trust Agreement and not because he was simply a minority shareholder.

[52] The motions judge also found that certain letters between and among Sum and/or Shing and their Hong Kong lawyers and Ontario lawyers during the period from January 2019 to January 2020 ought to have been disclosed.

[53] Shing had filed a letter from his Hong Kong lawyer dated July 19, 2019, which apparently related to negotiations to settle the estate of their mother and made reference to various matters relevant to the family business.

[54] On the motion to set aside the orders previously made, however, Chu included 24 letters sent and received in the relevant period (see Exhibit ‘F” to Chu’s affidavit sworn May 7, 2020 and the Endorsement of Gilmore J., at paras. 34 – 38).

[55] The motions judge, at para. 38, agreed that fairness dictated that all of those letters should have been disclosed by Shing, and not simply the selected letter from July 2019.

[56] Ultimately, the motions judge determined that she could not determine that Shing had a strong prima facie case of oppression or breach of trust observing that, at paras. 40 – 41:

The question to be addressed by the Court on this issue is whether the Court could decide the allegations in the Application based on the evidence before it. The short answer to this question is no. Looking at the available material, there is clear contradictory evidence with respect to the existence of the Trust Agreement. Issues of credibility are therefore engaged.

There are also other arguments in relation to the Trust Agreement which need to be explored further including, if it is found to exist, whether it was intended for any illegal purpose or whether it is unenforceable by reason of vagueness….

[57] Finally, the motions judge was satisfied that there were numerous concerns raised by Shing that must be addressed relating to the actions of Sum and Chu and, at least in part, as disclosed in or arising out of the financial statements from 2016 to 2019. These related to the purchase of the property owned by 107, lines of credit and other facilities, commission payments, bank overdrafts, salaries and various other issues.

[58] Accordingly, Gilmore J. held that while there was insufficient evidence to support the continuation of the orders previously granted, she found that there was evidence to support a finding that funds were in fact transferred from 107 and used by Sum and Chu to fund their purchases of what is now a large jointly held real estate portfolio.

[59] All of this led the motions judge to conclude, at para. 48, that Shing should be given appropriate relief in order to investigate these serious allegations and must receive answers to his questions by way of a proper forensic accounting, protected in the interim period by some security over Sum and Chu’s real property assets pending the result of that investigation.

The Applicable Law

Summary Judgment

[60] Summary judgment is sought pursuant to r. 20 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. The rule is clear that an affidavit for use on such a motion may be made on information and belief, and in response to affidavit material or other evidence supporting a motion for summary judgment, a responding party may not rest solely on the allegations or denials in the party’s pleadings, but must set out, in affidavit material or other evidence, specific facts showing that there is a genuine issue requiring a trial.

[61] Rule 20.04 sets out the power of this court on the disposition of such a motion:

Disposition of Motion

General

20.04 (1) Revoked: O. Reg. 438/08, s. 13 (1).

(2) The court shall grant summary judgment if,

(a) the court is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence; or

(b) the parties agree to have all or part of the claim determined by a summary judgment and the court is satisfied that it is appropriate to grant summary judgment. O. Reg. 284/01, s. 6; O. Reg. 438/08, s. 13 (2).

Powers

(2.1) In determining under clause (2) (a) whether there is a genuine issue requiring a trial, the court shall consider the evidence submitted by the parties and, if the determination is being made by a judge, the judge may exercise any of the following powers for the purpose, unless it is in the interest of justice for such powers to be exercised only at a trial:

1. Weighing the evidence.
2. Evaluating the credibility of a deponent.
3. Drawing any reasonable inference from the evidence. O. Reg. 438/08, s. 13 (3).

Oral Evidence (Mini-Trial)

(2.2) A judge may, for the purposes of exercising any of the powers set out in subrule (2.1), order that oral evidence be presented by one or more parties, with or without time limits on its presentation. O. Reg. 438/08, s. 13 (3).

Only Genuine Issue Is Amount

(3) Where the court is satisfied that the only genuine issue is the amount to which the moving party is entitled, the court may order a trial of that issue or grant judgment with a reference to determine the amount. R.R.O. 1990, Reg. 194, r. 20.04 (3); O. Reg. 438/08, s. 13 (4).

Only Genuine Issue is Question of Law

(4) Where the court is satisfied that the only genuine issue is a question of law, the court may determine the question and grant judgment accordingly, but where the motion is made to an associate judge, it shall be adjourned to be heard by a judge. R.R.O. 1990, Reg. 194, r. 20.04 (4); O. Reg. 438/08, s. 13 (4); O. Reg. 711/20, s. 7; O. Reg. 383/21, s. 15.

Only Claim Is For An Accounting

(5) Where the plaintiff is the moving party and claims an accounting and the defendant fails to satisfy the court that there is a preliminary issue to be tried, the court may grant judgment on the claim with a reference to take the accounts. R.R.O. 1990, Reg. 194, r. 20.04 (5).

[62] Rule 20.05 sets out the powers of the court where summary judgment is refused or granted only in part, and provides that the court may make an order specifying what material facts are not in dispute and defining the issues to be tried, and order that the action proceed to trial expeditiously on such terms or directions as are just.

[63] The Supreme Court of Canada considered the scope and application of summary judgment in Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87, observing, as has been quoted with approval in many subsequent cases, that the purpose of a summary judgment motion is to ensure the fair, just, proportionate, timely and affordable adjudication of disputes.

[64] The court must therefore engage in a two-step process. First, is the court able to determine that there is no genuine issue requiring trial, without resort to the fact-finding powers in r. 20? Second, if there appears to be a genuine issue, can the need for trial be avoided by using the fact‑finding powers, unless it is in the interests of justice for such powers to be exercised only after trial?

[65] Those fact-finding powers include the ability to weigh the evidence, evaluate the credibility of a deponent, and draw any reasonable inference from the evidence.

[66] The Supreme Court was clear in Hryniak, at para. 66, that use of the fact-finding powers is not contrary to the interests of justice if they lead to a fair and just result and serve the goals of timeliness, affordability and proportionality in light of the litigation as a whole.

[67] Partial summary judgment, however, is another matter. It is, generally, the rare case that will justify partial summary judgment. Justice Brown, writing for a unanimous panel of the Court of Appeal for Ontario, set out a cautionary approach in Malik v. Attia, 2020 ONCA 787, 29 R.P.R. (6th) 215, at para. 62, stating that, when faced with a partial summary judgment motion, a motions judge should make three simple requests of counsel or the parties:

i. demonstrate that dividing the determination of this case into several parts will prove cheaper for the parties;

ii. show how partial summary judgment will get the parties case in and out of the court system more quickly; and

iii. establish how partial summary judgment will not result in inconsistent findings by the multiple judges who will touch the divided case.

[68] In Malik, The Court of Appeal quoted with approval from 2287913 Ontario Inc. v. Blue Falls Manufacturing Ltd, 2015 ONSC 7982, in which Myers J. observed, at para. 10, that “summary judgment lies best when the moving party is able to identify a discrete, neat, gating issue that might be resolved on a motion to thereby save the parties the cost and delay associated with going to trial on a number of other issues.”

[69] As noted in Blue Falls, an issue on which summary judgment is typically granted is one that can be easily separated or bifurcated from the main action, be addressed expeditiously and in a cost-efficient manner, such that granting summary judgment could significantly improve access to justice. Where, however, partial summary judgment would lead to potential delay or increase the risk of creating duplicative proceedings or inconsistent findings, it should be declined.

[70] Justice Myers noted in that case, at para. 6, that if one or more causes of action survive summary judgment (as is inevitably the case where partial summary judgment is sought in the first place): “it seems to me that the same facts that formed the basis of the motion will then have to go to trial. Baywood Homes Partnership v. Haditaghi, 2014 ONCA 450, suggests that a motion for summary judgment is not appropriate in that circumstance.”

[71] Similarly, the Court of Appeal for Ontario in Healthy Lifestyle Medical Group Inc. v. Chand Morningside Plaza Inc., 2019 ONCA 6, 46 C.P.C. (8th) 25, at para. 9, noted that: “this court cautioned against partial summary judgment where it is possible that the trial judge ‘will develop a fuller appreciation of the relationships in the transactional context than the motions judge’ which could risk ‘inconsistent findings and substantive injustice’”.

[72] Finally, Myers J observed in Blue Falls, at para. 14, and I agree, that complexity alone is not a basis to reject a motion for summary judgment. The provisions of r. 20 give a motions judge significant flexibility to address even complex matters.

Limitations

[73] Oppression remedy claims are subject to the general two-year limitation period in s. 4 of the Limitations Act. The two-year period begins on the date on which the person with the claim first new or ought to have known of the elements of the claim (see s. 5 of the Limitations Act). The court presumes prejudice by the expiry of a limitation period (see Frohlick v. Pinkerton Canada Ltd., 2008 ONCA 3, 88 O.R. (3d) 401, at para. 22).

[74] Section 5(1)(a) of the Limitations Act is clear that if the plaintiff had actual knowledge of the requisite elements of the claim, the limitation period begins to run.

[75] However, a lack of such evidence and/or a denial of such actual knowledge will not suffice to prevent a finding that operation of the limitation period was triggered, if other provisions of s. 5 indicate that such a finding is appropriate.

[76] Section 5(1)(b) provides the objective test of what a reasonable person ought to have known. A claim is discovered when a plaintiff has knowledge, actual or constructive, of the material facts upon which a plausible inference of liability on the defendants part can be drawn, and the plaintiff will have constructive knowledge when the evidence shows that the plaintiff ought to have discovered the material facts by exercising reasonable diligence. (See Grant Thornton LLP v. New Brunswick, 2021 SCC 31, 461 D.L.R. (4th) 613, at paras. 42, 44).

[77] Moreover, s. 5(2) provides the rebuttable presumption that the plaintiff did have knowledge and the burden is on that party to rebut the presumption. On a r. 20 motion, and while the moving party retains the overall burden of showing that there is a genuine issue requiring trial, the evidentiary burden as to the discoverability issue effectively shifts to the responding party such that the plaintiff (responding party) must adduce evidence to demonstrate that there is a genuine issue requiring trial or at least that there is a genuine issue requiring trial as to whether the presumption has in fact been rebutted: See Shukster v. Young, 2012 ONSC 4807, at para. 19.

Positions of the Parties and Analysis

Issue #1: The Limitation Period - Claims More Than Two Years Old

[78] The moving parties argue that all of Shing’s claims relating to events that occurred more than two years prior to the commencement of the action should be dismissed on this motion. They argue that the acts about which Shing complains (i.e., that the individual Defendants withdrew more than they were entitled to receive from 107) are alleged to have occurred during each year of its operation. Since a series of singular discrete acts that continue over a period of time resulting in claims that arose more than two years prior to the commencement of the action are statute barred, they argue that Shing is out of time and the claims should be dismissed. (See Zhao v. Li, 2020 ONCA 121, 149 O.R. (3d) 353, at paras. 28-29).

[79] Moreover, and since prejudice by the expiry of the limitation period is both presumed at law and in fact present in this case (resulting from the death of a key witness, the mother of Shing and Sum, and the ordinary course destruction of corporate documents of 107 prior to 2013), Shing cannot meet his onus of demonstrating why the limitation period ought to be extended in this case.

[80] The moving parties argue that Shing knew, or at a minimum ought to have known, of the alleged wrongful acts over the 25-year period. They argue that there was no evidence of concealment, that Shing was always entitled to ask for financial information concerning 107 if he wished to do so, and that he simply never requested it.

[81] For this court to be satisfied that Shing failed to ask the relevant questions because this was a family business or he had a reasonable expectation that his brother was abiding by the alleged oral trust agreement on account of “Chinese culture” would be, they submit, a return to the special circumstances doctrine which has no application to the current limitation regime: Maurice v. Alles, 2016 ONCA 287, 130 O.R. (3d) 452, at para. 46.

[82] In particular, the moving parties argue that since Shing stated in his affidavit (at para. 13) that he expected that a reasonable management fee would be in the range of 5 – 10 percent of the rental income, and since he received the faxed copy of the financial statements of 107 in 1995 which reflected that Sum had taken a management fee of $30,000 as against rental income of $129,840, Shing knew or ought to have known that the management fee was therefore approximately 23 percent with the result that he also knew or ought to have known that Sum had breached the trust agreement.

[83] They also allege that since Shing was a sophisticated businessman, he ought to have appreciated “by 1994/1995” that 107 would have paid off its mortgage debt and therefore be generating significantly increased net income by 2004, since a “simple investment return calculation/mortgage amortization schedule” would reflect these facts.

[84] In addition, the Defendants argue that Shing admits that, had he received the financial statements for 107, he would have discovered his claims, since they disclose the allegedly oppressive and inappropriate behavior by Sum and Chu (Shing Reply Affidavit, at para. 83).

[85] In short, the moving parties argue that Shing has offered no evidence regarding his efforts to obtain the financial statements which he was entitled to receive or to rebut the presumption that the alleged breaches of the oral trust agreement were not discovered on the dates they occurred. Their position is that no information nor any documents were ever concealed, either at all or in a manner sufficient to toll the commencement of the limitation period.

[86] Finally, they argue that many of the events giving rise to the claims now asserted occurred more than 15 years prior to the commencement of the action, with the result that they are statute barred by the ultimate 15-year limitation period (s. 15(2) of the Limitations Act).

[87] In particular, they take the position on this motion that the following alleged issues in claims are statute barred (see moving parties’ factum, at para. 51):

Date of Event: Event: Limitation Act, 2002

June 2, 1995 Shing received 107’s financial statements for the year ending March 31, 1995. S. 15(2) ultimate limitation period

December 22, 1998 Purchase of 256 Doris Avenue S. 15(2) ultimate limitation period

October 18, 2000 Sale of Doris Avenue for $240,000.00 S. 15(2) ultimate limitation period

June 21, 1999 $1m mortgage registered against 2574 Yonge Street S. 15(2) ultimate limitation period

September 20, 2004 110 1994-2003 Financial Statements and Disclosure S. 15(2) ultimate limitation period

December 17, 2004 Purchase of 33 Sheppard Avenue East 111 S. 15(2) ultimate limitation period

April 15, 2005 15 years before the Application was issued on April 15, 2020. S. 15(2) ultimate limitation period

[88] For his part, Shing maintains that the individual Defendants intentionally concealed their misappropriations such that the limitation period did not begin to run, and at a minimum the credibility issues are so fundamental as to constitute a genuine issue for trial. His position on this motion is that he was engaged in the status of the investments and the activities of 107, although in a manner consistent with the trust he had placed in his brother such that he was content to accept verbal updates from time to time.

[89] Shing’s evidence was that he never performed a calculation of approximate interest amortization (i.e., the calculation referred to above) because he was too busy with other matters (Cross-examination of Shing, question 76).

[90] He takes the position that the exception to the general two-year limitation period set out in s. 2(1)(a) of the Limitations Act applies here, with the result that the limitation applicable to at least some of the claims of Shing is the ten-year limitation period provided for in s. 4 of the RPLA. Shing further takes the position that pursuant to s. 28 of the RPLA, even that ten-year period does not begin to run where there is concealed fraud, as he alleges is the case here.

[91] Shing has pleaded constructive and resulting trust remedies, as well as the existence of the oral trust agreement, and that the ten-year limitation period, as opposed to the general two-year limitation period, also applies to constructive trust claims in land: See McConnell v. Huxtable, 2014 ONCA 86, 118 O.R. (3d) 561.

[92] Finally, Shing argues that in any event, the moving parties have ignored the transitionary rules under the Limitations Act applicable to acts or omissions taking place before 2004, and the application of a rolling limitation period. Shing argues that prior to the coming into effect of the Limitations Act, oppression claims were not recognized as being subject to limitation periods at all since they were not “claims upon the case” (see Ford Motor Company of Canada, Limited v. Ontario Municipal Employees Retirement Board, (2006), 79 O.R. (3d) 81 (C.A.), at paras. 169‑173).

[93] It follows, he submits, that pursuant to s. 24(6) of the Limitations Act, if the claim was discovered before January 1, 2004, as the moving parties here allege was the case, there is no limitation period applicable to his claims. Accordingly, submits Shing, if he is wrong and the Defendants/moving parties are correct that there was no fraudulent concealment, his claim may not be subject to a limitation period at all.

[94] Whether or not that is correct, Shing argues that the Zhao case referred to above did not determine the issue of how the statutory provisions apply in cases where the oppression is ongoing but the plaintiff is unaware of it (see para. 27). He argues that the reasoning of the Court of Appeal for Ontario in Kharkhanechi v. Connor, Clark & Lunn Financial Group Ltd., 2022 ONCA 518, at paras. 21-27, applies here, with the result that the question of whether a rolling limitation period applies, depends upon the nature of the claim. A rolling limitation period may be appropriate where each additional breach of contract can be described as a new breach, rather than a continuing delinquency.

[95] Considering all of the evidence, I decline to grant partial summary judgment on the basis of the expiry of the applicable limitation period.

[96] I am unable to conclude that there is no genuine issue for trial, without resorting to the second stage of fact-finding powers found in r. 20. Even engaging those powers, I am unable to conclude that there is no genuine issue for trial.

[97] It is not clear to me on the basis of the record on this motion, that there is sufficient evidence upon which I can conclude whether the events complained of were discrete, independent or standalone events or occurrences, or were part of a pattern of a continuing breach of duties.

[98] Clearly, such a determination would depend at least in part on credibility findings. While, as noted above, a summary judgment motions judge has the power to make such findings, I decline to do so in the circumstances.

[99] The credibility of Shing and Sum in particular, and indeed also of Chu, is central to these findings. Determinations of credibility go to the relevant issues of the alleged lack of interest by Shing for many years in what he now claims were his business interests (i.e., whether his inaction was the result of disinterest or a function of his complete trust in his brother and sister-in-law as informed by Chinese cultural norms), and as further discussed below, all of the facts relevant to a determination of whether a trust exists or not.

[100] I am not prepared to find, for the purposes of this motion, that Shing knew or ought to have known that there was a breach of trust by Sum on the basis of the June 2, 1995 fax which showed that a management fee had been taken. The argument advanced by the moving parties is that a simple calculation would have reflected the fact that this management fee exceeded an amount equal to the amount that Shing admitted on cross-examination he considered reasonable and in accordance with the trust agreement. I am not prepared to grant partial summary judgment on the basis that, by the receipt of the financial statement alone, Shing knew or ought to have known of his brother’s breach of trust and therefore the elements of his claim.

[101] In the same way, I am not prepared to conclude that Shing ought to have known that funds were being misappropriated, because he could have obtained a simple, publicly available mortgage calculator and completed the math to determine (approximately) when the mortgage on 2574 Yonge ought to have been paid off, and therefore he ought to have been on his inquiry as to what investments were being made with the rental income at issue and the surrounding circumstances. All of this needs to be explored at trial.

[102] In any event of the determination as to which limitation period applies to what claim, the Court must still address the issue of whether and the extent to which Sum and Chu fraudulently concealed Shing’s claim from him so as to toll whichever limitation period applies. In Colin v. Tan, 2016 ONSC 1187, Perell, J. described (at para. 45, quoting with approval from M. (K.) v. M. (H), 1992 SCC 31), the fraudulent concealment inquiry as having three elements:

(a) the defendant and plaintiff have a special relationship with one another;

(b) given the special or confidential nature of the relationship, the defendant’s conduct is unconscionable; and

(c) the defendant conceals the plaintiff’s right of action either actively or the right of action is concealed by the manner of wrongdoing.

[103] In my view, this inquiry, and particularly the third element, needs to be explored at a trial. Moreover, the evidence relevant to the issue of the alleged concealment will necessarily be considered at trial even if partial summary judgment were granted on the basis that there was no oral trust agreement, since Shing asserts that in any event, essentially the same fiduciary duties are owed under a resulting trust. In addition to the possibility of conflicting findings, I cannot conclude that partial summary judgment now would result in a final adjudication on the merits being faster and cheaper.

[104] I am also not prepared to make the necessary findings in favour of the moving parties, given their refusal to produce their own tax returns, business records, or otherwise explain the genesis of the capital and value of the portfolio they now own, as against the allegation by Shing that it results from their misappropriation of his funds. This is also a fundamental issue, best determined by a trial judge hearing from all of these witnesses on the basis of a full record.

[105] While Sum and Chu have elected to maintain their refusal to produce those documents, they must bear one of the consequences of that which is that the incomplete record before me now makes it even more challenging to grant judgment on a summary basis. It seems to me that those documents are centrally relevant to one of the main issues requiring determination were judgment to be granted: did Sum and Chu have sufficient capital resources of their own, generated through their own income, to facilitate the purchase of the now significant portfolio of real estate properties they own.

[106] Shing argues that I ought to draw the adverse inference against the moving parties now, with the result also that (partial) summary judgment would not follow.

[107] Shing says he discovered all of the misappropriations only long after the fact since he relied on verbal updates from his brother essentially to the effect that 107 was performing well.

[108] It was, Shing says, only in 2018 that he was on his inquiry. His daughter was married in Hong Kong and Sum and Chu attended the wedding during which Shing made inquiries about the status of 107 generally and 2574 Yonge specifically. Shing’s evidence is that Sum was evasive and that an ordinary course HSBC banking information update form required in December 2018 put him further on his inquiry since it failed to describe the trust agreement.

[109] Ultimately, and unable (he says) to obtain a detailed account of the financial affairs of 107, Shing retained Ontario lawyers in the fall of 2019 first to obtain and provide a detailed record of the real estate holdings of 107 to see what property it owned and what encumbrances were registered. Shing also directed his lawyers to investigate the real estate holdings owned by Sum and Chu.

[110] Other deficiencies in the record, which can be more fully developed for trial, include the outstanding issues identified in the interim and preliminary report of the forensic accountant. As stated above, Gilmore J. observed, and I agree, that while her interim orders were set aside (on Her Honour’s own review), sufficient issues and allegations had been raised by Shing in his claim such that they should be determined on a full record, including but not limited to a complete forensic accounting. That process has not been completed. In my view, the forensic accountant should issue a final report, with such findings as he is in a position to make based upon as full a record as is possible, before findings of fact are made by this Court.

[111] In addition to all of the above, one difficulty with the chart reproduced above at paragraph 87 and relied on by the moving parties is that the events described appear to have occurred more than 15 years prior to the commencement of the claim, but the events themselves do not necessarily track directly to claims, let alone discrete, distinct claims that are amenable to partial summary judgment. At best, they appear to represent some of the key events in an ongoing and continuous relationship of some 25 years during which, it is alleged, that numerous events (some continuing and some not) occurred, giving rise to breaches of fiduciary duty and trust claims.

[112] It may be, at trial, that once developed on a full record, the claims can be categorized as they are in the chart and considered (for limitation period purposes and on the merits) by the Court. But it is not clear to me that such can be done on the basis of the record as it sits today.

[113] With respect to the limitation period arguments, I am not able to conclude on the basis of the record precisely which claims were discovered or ought to have been discoverable more than two years prior to the commencement of the claim. For example, does such analysis require a determination as to what happened each time a payment of rent was received by 107, and what was done with those rental income proceeds? In my view, such a determination should be made at trial.

[114] Finally, even if I were persuaded that summary judgment on these issues were appropriate if that judgment finally disposed of the action, I would not grant judgment on those issues here since such would constitute only partial summary judgment in this matter.

[115] I am not persuaded that granting partial summary judgment now on the limitation issues will prove cheaper and/or more expeditious for the parties or that there will be no risk of inconsistent findings. Rather, I think the opposite will be true. Many of the very same facts that underpin the relief sought on this partial summary judgment motion relevant to the limitations issues will inevitably be at issue at trial of the remaining claims. The evidence of each of the three individual parties to this action will still be highly relevant.

Issue #2: The Alleged Trust Agreement

[116] I am also not persuaded that this is a case for partial summary judgment based on a determination on this motion that there is no trust in favour of Shing.

[117] The moving parties assert that the conduct of Shing, and indeed all of the objective evidence over the period of approximately 25 years, is inconsistent with the fact of there having been an agreed oral trust agreement.

[118] They point to various documents inconsistent with the existence of a trust, including:

(a) Shing’s signed resolution dated April 18, 1994, subscribing for 49 percent of the shares of 107;

(b) Shing’s signed resolution of the same date adopting the constating documents of 107;

(c) the loan agreements of May 26, 2010, by which Shing transferred his $800,000 shareholder loan account to that of Sum and Chu;

(d) a 2018 HSBC privacy consent form confirming that Shing was a 49 percent owner of 107;

(e) the 2019 correspondence referred to above (April 2 and December 30) from Shing’s Hong Kong lawyers stating that 107 was jointly owned; and

(f) the general corporate records of 107.

[119] Other than the shareholder loan agreements, which Shing disputes as being forgeries, he acknowledges all of the other documents. The moving parties rely on this fact. The problem, however, is that all of them are as equally consistent with Shing’s position that he knowingly and willingly signed any and all documents confirming the legal ownership of shares in the name of Sum on the basis that they were held in trust for him, as they are with Sum’s position that there was no trust agreement.

[120] A responding party on a summary judgment motion clearly has the obligation to put his or her best foot forward, and the moving parties argue that the bald assertion by Shing that his signature is a forgery, is unsupported by any other sworn evidence. But in the circumstances, what other relevant evidence could Shing put forward? He says he neither saw nor signed the documents. There is no evidence such as an email confirmation or fax, that they were sent to him, let alone received back by Sum (or his lawyers) as executed by Shing.

[121] For these reasons, the argument by the moving parties to the effect that I have the jurisdiction to conduct my own handwriting comparison and conclude that the signature is not a forgery (See R. v. Cunsolo, 2014 ONCA 364, 319 O.A.C. 278, at paras. 40-44), does not assist. Even if I conducted such a comparison, and even if I further concluded that the signature was indeed that of Shing, I am not persuaded that judgment should follow in the absence of the complete factual matrix of the evidence including that of Shing at trial.

[122] The moving parties also take the position that the alleged oral trust agreement ought to be unenforceable for a lack of certainty, because it is not possible to determine the obligations of the parties with respect to specifically enumerated essential terms of the alleged trust agreement. These include Sum’s management obligations; what affairs of 107 were required to be reported and how; what formula ought to be applied for determining whether and when the revenues of 107 permitted a management fee; and whether, when and how profits were required to be invested in other properties.

[123] As noted, Shing asserts in his claim that in the alternative to an oral trust, there is a resulting or constructive trust. Even if I were prepared to make the findings with respect to the certainties in terms of the oral trust agreement (or lack thereof) urged by the moving parties, I would not be prepared to conclude on the basis of the record before me whether a resulting or constructive trust should be imposed.

[124] All of these trust relationships depend, to a significant extent, on findings with respect to the use of funds belonging to 107. The parties advance contradictory positions not only about the source of the funds advanced by Shing to Sum (revenue from the family business or Shing’s own assets), but how and on what terms the funds were advanced.

[125] The moving parties argue that the family business in Hong Kong was extremely successful, relying in part on the fact that in February 2021, Shing paid Sum what was said to be only five years of partner draws which totalled HKD8,851,500, approximately equivalent to CDN$1,500,000. As a result, Sum says, it is untenable and incredible for Shing to maintain that the family business was more modest and never generated revenues in anywhere near the amounts transferred to Sum in Canada.

[126] Shing, now retired, maintains that he worked in the family business (originally consisting of a stationary store) and rental investment properties. However, he maintains that he also engaged in investments with his own funds, including real estate investments in Hong Kong, and his wife Gloria earned significant income as a headmistress at a private school in Hong Kong.

[127] Shing has produced tax returns belonging to his mother which, he maintains, show that income between 1989 and 1993 was in fact extremely modest, and ranged from HKD equivalents of CAD$8500 to CAD$30,000 and that during the same period, the family business earned only the Canadian equivalent of CAD$85,000 for the 1992/1993 tax year (Shing affidavit, at para. 9 and Exhibit “F”).

[128] In contrast to these modest amounts earned by the family business, Shing has put forward evidence of his own investments in Million Builders Limited (“MBL”) through which, he maintains, he and his wife were able to capitalize on the end of British rule of Hong Kong in 1997, earning profits to Shing of approximately CAD$1,165,000 (Shing affidavit, at para. 6 and exhibits B – E).

[129] I cannot determine on the record before me whether the profits and income that Shing and his wife earned from their own businesses were sufficient, and sufficient at the time of the advances, to fund the transfers of capital to his brother Sum in Canada. They could be, but this determination should be made at trial.

[130] As a specific example, but by no means the only example, the circumstances of, and the source of funds for, the purchase of 2574 Yonge in particular are hotly contested.

[131] So too are the circumstances regarding the purchase of another property, a preconstruction condominium, at 256 Doris Avenue, Suite 1508, Toronto (“256 Doris”).

[132] Areas of continuing dispute relevant to a disposition of certain of these claims on the merits relating to the issue of whether or not there was a trust include the following (some of which have been referred to above):

(a) Shing maintains that following the immigration by Sum and Chu to Canada in or about 1991, their financial circumstances were modest and life was difficult. Sum and Chu deny this, but still refuse to provide tax returns to corroborate their position that they had achieved independent financial success and generated capital on their own for their businesses and assets sufficient to fund the purchases of their now significant Canadian real estate holdings;

(b) Shing’s evidence is that he transferred CAD$1,577,322.24 to his brother, Sum, between August 1993 and October 2002. (Shing, January affidavit, at paras. 18, 29 and 33). Sum does not dispute the transfers but maintains that they were on account of profits or income from the family business in Hong Kong. It seems clear that the transfers were made from Shing’s Hong Kong bank account (as opposed to an account of the family business) to Sum’s Canadian bank account, but there is no evidence as to the original source of the funds (i.e., Shing’s own assets or prior transfers from the family business);

(c) Shing’s evidence is to the effect that while the income from the family business in Hong Kong was modest, Sum’s share was in any event always sent to his (Sum’s) accounts in Hong Kong. He relies on this for two reasons. First, he says that Sum has consistently and regularly received his share of profits from the family business. Second, he says that these transfers to Sum’s Hong Kong accounts are completely separate and distinct from the transfers to the Canadian accounts controlled by Sum which he maintains were for his (Shing’s) benefit;

(d) 2574 Yonge was tenanted by the retail store, The Gap, when the property was purchased in 1994, by which time Shing had sent CAD$916,322.24 to Sum for the purchase, recognizing that the balance of the purchase price (over 50 percent) would have to be financed by a mortgage;

(e) The agreement of purchase and sale for 2574 Yonge is signed by Sum, although it is clearly “in trust” for Shing. Shing provided Sum with a power of attorney not only generally, but specifically noting that it was to apply to the purchase and financing of 2574 Yonge (Shing January affidavit, at para. 20, exhibits J and K). None of this would have been relevant or necessary but for the alleged trust;

(f) Shing maintains that he and his brother Sum had further discussions about the capital structure of 107, and specifically about how the signing of a formal trust agreement might adversely affect the ability of 107 to enjoy preferential tax status (Shing, January affidavit, at para. 22). Shing maintains that he knew very little of Canadian or Ontario law and trusted his brother in accordance with his Chinese cultural norms. Sum denies that the discussions occurred along those lines at all (this public policy issue is discussed further below);

(g) Shing says he transferred to Sum CDN$201,000 between July 1996 and May 1997, specifically to cover the purchase price for 256 Doris of $195,000 plus acquisition expenses. The agreement of purchase and sale, signed by Sum, specifically states that he signed “in trust for Shing” (Shing January affidavit, at para. 31 and exhibit S);

(h) an RBC bank account, apparently to facilitate the purchase and management of 256 Doris was also opened, according to the account statements, by Sum “in trust for Shing for 256 Doris Avenue” (affidavit of Anna Honore, February 4, 2022, exhibit AH);

(i) Shing states that records, including publicly available real estate records which he reviewed only in the course of this litigation, reflect that Sum used only a small portion of the $201,000 in transfers to fund the purchase, and in fact 256 Doris was purchased but was heavily financed with a mortgage of $146,925. Shing maintains that he has asked, but still has not received an explanation as to, what happened with the balance of the $201,000;

(j) Shing also learned during this litigation, he maintains, that the individual Defendants increased the indebtedness secured by 2574 Yonge and specifically denies that two mortgages were made with his consent or even knowledge: a June 1, 1999 loan from HSBC Canada in the amount of $1 million, and a May 19, 2017 loan from HSBC in the amount of $300,000.

[133] In my view, all of these issues should be determined at trial since the record on this motion relevant to these issues also is incomplete. The final report of the forensic accountant may be relevant to and informative of these issues in addition to those discussed above.

[134] As with the limitation period issues discussed above, I cannot conclude that there is no genuine issue for trial relating to the alleged trust claims, even with resort to the fact-finding powers under r. 20.

[135] It was only when Shing directed his lawyers to investigate the real estate holdings owned by Sum and Chu when he was put on his inquiry in 2018 referred to above, he says, that he learned of the misappropriations relating to 256 Doris and the unauthorized mortgages on 2574 Yonge.

[136] It was also then that he learned of the significant number and value of properties then owned by Sum and Chu, albeit without the knowledge or consent of Shing (if indeed the properties were intended to be held in trust for him) or alternatively, without any known sources of income or capital sufficient to fund the purchases. These other properties include:

(a) 23 Lorrain Drive, Unit 1703, Toronto;

(b) 89 Dunfield Avenue, Unit 2806, Toronto;

(c) Seven Kenaston Gardens, Unit 703, Toronto;

(d) 51 Trolley Crescent, Unit 707, Toronto;

(e) 33 Sheppard Avenue East, Unit 206, Toronto;

(f) 28 Clairtrell, Road, Toronto;

(g) 650 Sheppard Avenue East, Unit 202, Toronto;

(h) 460 Main Street West, Hamilton; and

(i) 1 Yorkville Avenue, Unit 4010, Toronto.

[137] According to Shing, the aggregate of the purchase prices for all of these properties totals approximately CDN$3,838,571 (Shing’s January affidavit, at paras. 60 – 61, related exhibits and answers to undertakings).

[138] Shing maintains that the misappropriation by the individual Defendants of the equity and income of 107 was confirmed but only during this proceeding through a review of the banking records obtained pursuant to the Norwich Order of Gilmore J. referred to above.

[139] Importantly, those records were reviewed by the forensic accountant retained by Shing, Peter Macaulay. Numerous inconsistencies and/or disproportionate amounts spent by 107 are set out in the motion materials (see, for example, factum of the Defendants, at para. 37). At para. 38 of the factum are set out the alleged direct links between the acquisition of these properties by Sum and Chu, and funds taken from 107.

[140] Sum and Chu argue vigourously that the work of Mr. Macaulay and his ability to reach conclusions has been impaired and inhibited by the refusal of the Defendants to provide significant and material amounts of information, including their own personal tax returns and notices of assessment.

[141] Notwithstanding the lack of cooperation however, Mr. Macaulay did generate an interim report which concludes, among other things, that:

(a) Sum and Chu have withdrawn at least $1,491,855 from 107, net of adjustments for inflation and loss of opportunity (and therefore materially in excess of the $30,000 per year which even the Defendants maintain was disclosed in the 1995 faxed financial statements);

(b) assuming a reasonable management fee or compensation to Sum and Chu of 5 – 10 percent of the rental income of 107, the funds extracted by them over and above that reasonable compensation estimate are between $2,352,721 and $2,730,843; and

(c) the total amount misappropriated from 107 by the individual Defendants amounts to $4,438,079 - 4,889,117 inclusive of interest to January 2022.

[142] In sum, the factual disputes about all of these issues are fundamental and should be determined on a full record. Moreover, since as noted above the work of the forensic accountant remains incomplete, I am unable to conclude today that there will not be even further overlap of issues and evidence, and a risk of inconsistent findings, depending on what is uncovered and reported once the work is completed.

[143] For all of these reasons also, I am not prepared to grant partial summary judgment on the basis of a conclusion that there was no oral trust agreement.

[144] Finally, the moving parties argue that even if there was an oral trust agreement, it is void for public policy reasons in that it was specifically settled to avoid paying Canadian taxes. If Shing were the shareholder of 107 as to 100 percent, as he alleges that he beneficially is, 107 would not qualify to be a Canadian Controlled Private Company (”CCPC”) for the purposes of the Income Tax Act, R.S.C. 1985, c. 1 (5th Supp.), with the further result that, among other things, it would not be entitled to the small business deduction reducing the combined federal and Ontario tax rate on the first $500,000 of active income by approximately half.

[145] In response, Shing alleges that he knew very little of Canadian law in general, and relied upon the Defendants.

[146] This issue of the purpose and intent of the alleged trust, also, is fundamental and should be determined at trial.

Summary and Conclusion

[147] While it is not unusual in the case of this nature that some issues would turn on findings of credibility, and while I equally recognize the fact-finding powers available to me under r. 20, in my view the credibility findings necessary to be made here to determine the issues in respect of which judgment is sought on this motion are so fundamental that I cannot be satisfied that there is no genuine issue for trial.

[148] Moreover, I am not even persuaded that the two issues, or categories of issues, in respect of which the moving parties seek judgment are as clear-cut or distinguishable even one from the other, let alone distinguishable from the balance of the claims, so as to justify partial summary judgment.

[149] Virtually all of the claims asserted by the Plaintiff flow from the alleged trust relationship and cannot be easily severed from all claims more than two years old (or those claims more than 15 years old such as would possibly be barred by an ultimate limitation period, depending on which limitation period applied, and whether its commencement was tolled).

[150] I agree with the submission of the responding parties that granting judgment would require a determination on the following critical issues of credibility, among others which I am not prepared to make:

(a) the circumstances surrounding the formation of 107;

(b) Shing’s assertion that he alone funded 107;

(c) Shing’s assertion that Sum agreed to hold his 51 percent of the shares in 107 in trust for Shing;

(d) Shing’s assertion as to the trust agreement and the terms thereof; and

(e) Shing’s assertion that he trusted his brother and accepted the reassuring reports he was receiving from him (alleged to be false) such that he had no reason to investigate the matter further until 2018.

[151] Having considered all of the issues, I cannot conclude that partial summary judgment should be granted here. I am not persuaded that dividing the determination of this case into several parts will prove cheaper for the parties, get the case in and out of the court system more quickly, or that partial summary judgment will not result in inconsistent findings. As Brown J.A. observed in Malik, at para. 68:

I appreciate that judicial time for civil matters is stretched thin in most regions of this province. But for summary judgment to achieve its stated objective – faster and cheaper access to a final adjudication on the merits – triage processes must be put in place so that judges end up determining a case once and for all on the merits, instead of slicing determinations into a series of partial summary judgments.

Disposition

[152] For all of these reasons, the motion for partial summary judgment is dismissed.

[153] Neither party was in a position at the conclusion of argument to address costs. If the parties cannot agree on costs, written submissions not exceeding three pages in length, together with a bill of costs, may be submitted by the Plaintiff, responding party, within 10 days. Responding submissions of the moving parties, Defendants, also not exceeding three pages in length, may be submitted within seven days thereafter.

Osborne, J. Date: January 19, 2023