Court File and Parties

COURT FILE NO.: CV-15-00533145-0000 DATE: 20240904

ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN: SAE-BIN IM, Plaintiff – and – BMO INVESTORLINE INC., BANK OF MONTREAL, CIBC INVESTOR SERVICES INC., CANADIAN IMPERIAL BANK OF COMMERCE, TD WATERHOUSE CANADA TORONTO-DOMINION BANK, and CANADIAN SECURITIES ADMINISTRATORS, INVESTMENT INDUSTRY REGULATORY ORGANIZATION OF CANADA and JOE OLIVER, MINISTER OF FINANCE, CANADA, Defendants

Counsel: Sae-Bin Im, self-represented Brandon Barnes Trickett and Ekin Cinar, for the Defendants Bank of Montreal and BMO InvestorLine Inc. Sara Wright, for the Defendants Canadian Imperial Bank of Commerce and CIBC Investor Services Inc.

HEARD: July 16 and 17, 2024

L. Brownstone J.

Introduction

[1] The plaintiff, Mr. Im, held various investment accounts with BMO InvestorLine Inc. (“InvestorLine”) and CIBC Investor Services Inc. (“CIBC ISI”). He alleges he was improperly prohibited from completing certain trades in these accounts. Bank of Montreal/InvestorLine, CIBC/CIBC ISI and Mr. Im each brings a motion for summary judgment.

[2] Mr. Im’s notice of motion seeks judgment against both defendants granting him general damages, damages for malice, misrepresentation, and injurious falsehood, breach of fiduciary duty, negligence, moral, punitive and exemplary damages, damages for infliction of emotional distress, and damages for forfeited profits. Against CIBC, he also claims consequential damages for being unable to be at his mother’s bedside at the time of her death.

[3] The defendants Bank of Montreal (“BMO”) and Canadian Imperial Bank of Commerce (“CIBC”) move for summary judgment dismissing the claims against them in their entirety.

[4] The action as against the defendants Toronto Dominion Bank and Investment Industry Regulatory Organization of Canada (“IIROC”) has been dismissed on consent.

[5] For the reasons that follow, Mr. Im’s motion for summary judgment is dismissed. The defendants’ motions for summary judgment are granted, with the result that Mr. Im’s claims are dismissed and the litigation is at an end.

Background

A. The parties

[6] Mr. Im is an individual who directed his own investments in various brokerages. He became a customer of InvestorLine in 2013. Mr. Im has been a customer of CIBC since April 2009 and had previously been a customer of CIBC ISI between May 2011 and early 2015.

[7] As can be seen from the title of proceedings, the parties to the litigation have changed over time. The current defendants are BMO and CIBC, federally regulated banks. However, Mr. Im’s investment accounts were with separate legal entities, InvestorLine in the case of BMO and CIBC ISI in the case of CIBC.

[8] InvestorLine is an online broker, offering online and telephone platforms for clients to trade in securities at their own direction. BMO takes the position that it has no legal responsibility for InvestorLine and is not a proper party to the claim. InvestorLine was initially named as a defendant, but Mr. Im amended his claim to replace InvestorLine with BMO.

[9] CIBC ISI is an affiliate of CIBC that offers wealth management and securities brokerage services. CIBC ISI was initially a defendant to the claim, but Mr. Im substituted CIBC in 2019.

[10] Mr. Im states he was not sure which entity was the proper defendant and argues the distinction between the banks and their affiliates is “immaterial”. Without agreeing with this position, and in tandem with my comments about CIBC’s limitations defence at paragraph 83 below, I have considered Mr. Im’s arguments on their merits, assuming that Mr. Im was making them against the properly named entities.

B. The InvestorLine claim

i) The InvestorLine account’s terms

[11] Mr. Im opened an InvestorLine margin investment account online on May 13, 2013 (“the InvestorLine account”). Mr. Im was required to accept and agree to adhere to terms and conditions in order to open the InvestorLine account.

[12] The terms of the InvestorLine account permit InvestorLine to reject any requested trade for any reason. InvestorLine is also permitted to impose terms of use for the accounts as it deems necessary or appropriate. In margin accounts, overconcentration is a risk to InvestorLine. The degree of concentration is therefore a factor InvestorLine uses to determine the availability of credit in a margin account.

[13] The agreement between Mr. Im and InvestorLine includes the following term:

2. Operation of the Account BMO InvestorLine has the right to determine in its discretion whether or not any order for Transactions in Securities for the BMO InvestorLine Account is acceptable and whether to execute such order. BMO InvestorLine may restrict trading in the BMO InvestorLine Account at any time at its sole discretion. Subject to the provisions of Part C, BMO InvestorLine will promptly credit to the Bank Account any dividends, interest and capital distributions on or in respect of Securities held in the BMO InvestorLine Account, which are paid by cheque, cash, electronic transfer or other immediately available funds, and any monies (net of all commissions and the fees, charges and taxes received as proceeds from Transactions in Securities held in the BMO InvestorLine Account. The Client acknowledges that the relationship between the Client and BMO InvestorLine and Bank of Montreal with respect to the Bank Account is one of debtor and creditor only. Neither BMO InvestorLine nor the Bank shall be responsible to the Client for any failure of either of them to credit, or any delay by either of them in crediting, any amount to the Bank Account. BMO InvestorLine will promptly debit to the Bank Account any commissions, fees, charges and taxes and other amounts owed by the Client to BMO InvestorLine from time to time, including any interest thereon.

[14] The agreement permits InvestorLine to close the account if the agreement terms are violated or if the account is operated in any unsatisfactory manner.

[15] With respect to option trades, the agreement provides:

4. Rights of BMO InvestorLine BMO InvestorLine will have sole discretion to determine whether or not to accept any order from the Client for a trade in an Option. The Client acknowledges that BMO InvestorLine has no duty or obligation to exercise an Option belonging to the Client without his or her specific instructions to that effect. BMO InvestorLine may execute orders for the Client acting as principal on the other side of a transaction or as part of larger transactions for the Client and others and may act for other clients on the other side of a transaction as BMO InvestorLine may deem advisable, subject, however to the rules of the applicable exchange. The Client consents and agrees to ratify any transactions in his or her account in which BMO InvestorLine acts as a market maker or principal in the purchase or sale of Options. It is also understood that any charge to the Client expressed as a commission for any purchase or sale of Options, where BMO InvestorLine acts as a market maker or principal shall be deemed a sum payable increasing the cost to the Client of such transactions.

ii) Mr. Im’s trading at InvestorLine

[16] The facts giving rise to the litigation are uncontentious. I set them out here.

[17] The day after Mr. Im opened the InvestorLine account, he requested a transfer of securities into the account from an HSBC account. The securities were received on May 16, 2013 and available for trading on May 22, 2013. Mr. Im complained to InvestorLine that the transfer took too long, and that he was unable to conduct a trade of Baidu Inc. (“Baidu”) shares, which he wished to effect on May 17, 2013.

[18] The securities transferred from HSBC were Baidu shares valued at $269,869.33. In July 2013, Mr. Im purchased 700 additional shares in Baidu on margin. Mr. Im also purchased a US dollar-denominated call option for Baidu which expired on September 21, 2013. Mr. Im held no securities for any other entities in his InvestorLine account until August 2013.

[19] In August 2013, Mr. Im purchased shares in Qihoo 360 on margin. Mr. Im was also attempting to buy further Baidu securities on margin, which were being rejected by InvestorLine.

[20] At the time his purchases were being rejected in August 2013, Mr. Im renewed his earlier complaint about the initial transfer having taken too long and complained to an InvestorLine manager, IIROC, and the CEO of BMO about InvestorLine’s concentration rules. He had previously complained about concentration rules and had voiced a view that they would be legally unenforceable.

[21] InvestorLine explained to Mr. Im in August 2013 that his buy orders were being rejected due to an overconcentration of Baidu in his account. Mr. Im objected to InvestorLine’s conduct.

[22] InvestorLine determined that it could not have a successful relationship with Mr. Im and decided to demarket his account. As of September 3, 2013, InvestorLine would not execute purchase trades in Mr. Im’s InvestorLine account. Mr. Im was advised that he had to transfer the holdings to another broker or sell his Baidu call option. Mr. Im was to take such steps as were necessary to close the InvestorLine account within 60 days, failing which InvestorLine would take such steps as were necessary to facilitate its closure. The exercise of the Baidu option to purchase on or before September 21, 2013 (a Saturday) would not be permitted.

[23] Mr. Im wrote to Mr. Richard Dussault, then a Vice-President at InvestorLine, and to the CEO of BMO on September 19, 2013, taking the position that concentration requirements were unlawful or unethical. InvestorLine responded the next day with an unchanged position and asked Mr. Im to provide clear instructions for the closing order for the call options expiring that day. InvestorLine advised that if it did not receive clear instructions to close the position by 3:30 p.m. that day, it would move forward and close it to avoid an automatic exercise of the purchase.

[24] Mr. Im telephoned Mr. Dussault at 3:29 p.m. on September 20, 2013. The call lasted for 32 minutes. Mr. Im pleaded to be permitted to make the purchase. Mr. Dussault refused.

[25] Mr. Im did not sell the option or transfer the shares. Therefore, in order to avoid the Baidu shares being purchased automatically under the call option, InvestorLine sold the option on September 20, 2013, the last trading day before it expired. Mr. Im realised a gain of $94,925.67 from the sale.

C. The CIBC ISI claim

i) The CIBC/CIBC ISI accounts’ terms

[26] The facts regarding the CIBC/ CIBC ISI claims, which I set out below, are also uncontentious.

[27] Mr. Im opened an “everyday chequing” personal bank account with CIBC (the "CIBC bank account") in March 2011 and a margin account with CIBC ISI in May 2011 (“the ISI margin account”). When he opened these accounts, Mr. Im was required to, and did, acknowledge and agree to several policies as well as terms and conditions, including an electronic access agreement (“the EAA”).

[28] The EAA provides that customers of both CIBC and CIBC ISI must use their confidential bank card number and password to access online banking, and must use their confidential user ID and password to access their accounts with CIBC ISI. The EAA further provides that customers may be asked to answer personal verification questions ("PVQs") when attempting to access their accounts. PVQs are an important tool used by the CIBC entities to combat fraud.

[29] The EAA permits CIBC and CIBC ISI to restrict access to a customer’s accounts where PVQs are not answered correctly or where fraudulent activity is suspected. The CIBC entities may, at their sole discretion, decline to act on instructions provided electronically. Section 18 of the EAA provides as follows:

18. Declining or Acting on Your Instructions: When using Wealth Management Online, you agree that we may (at our sole discretion) decline to act on an Instruction from you. We will not be liable if we act or fail to act in respect of an Instruction. You also agree that:

• Your Instructions may be sent to an exchange or market without our prior review.
• All Instructions will be subject to the rules governing the exchanges or markets where the orders are executed (for example, requirements regarding the entry and trading of orders) and you will comply with these requirements.
• Instructions are subject to any additional requirements that we may impose from time to time.
• We have the right to reject, change or remove any Instruction, or to cancel any trade resulting from your Instruction.

ii) Mr. Im’s July 24, 2013 transactions

[30] On July 24, 2013, Mr. Im tried to log in to his CIBC ISI margin account from Robarts Library. Because the IP address was unfamiliar, he was asked to answer his PVQs. He did not answer them correctly and was therefore denied access to his account.

[31] Mr. Im then went to a nearby CIBC branch where he states he was assisted by a branch employee as he wished to carry out a series of transactions. First, he wished to transfer $17,500 from his personal line of credit to his CIBC bank account. Then, he wished to transfer the same amount from that account to his ISI margin account.

[32] Mr. Im complains that he was wrongly denied access to his CIBC bank account when he tried to log in at the branch. Nonetheless, he appears to have been assisted by the branch employee in carrying out the two transactions above.

[33] Mr. Im then proceeded to a third location, a nearby public library. There, he tried to place three option orders in respect of Baidu shares – a first with Toronto Dominion Bank (or TD Waterhouse) at 3:53 p.m., a second with InvestorLine at 3:56 p.m., and a third with CIBC ISI at 3:59:25 p.m. The first two orders were processed; the CIBC ISI order was not.

[34] Mr. Im attended at CIBC ISI’s office that evening and spoke to two employees. He was advised that the order was probably rejected because it was submitted late in the afternoon and would have needed approval from CIBC ISI before execution. It would not have been possible to obtain approval between the time the order was placed and closing of the markets at 4:00 p.m. One of the employees, Mr. James Queroub, advised Mr. Im that he would investigate the matter further the next day.

[35] The next day, Mr. Queroub investigated Mr. Im's complaints and confirmed that because Mr. Im's order was placed at 3:59:25 p.m. and did not qualify for automatic approval without human review (known as “straight-through processing” or "STP"), there was not enough time for a CIBC ISI employee to manually review and approve Mr. Im's transaction before the market closed 35 seconds later.

[36] CIBC ISI states that one reason human review was required was because Mr. Im had a low margin balance in his account and was seeking to execute a trade with a significant amount of borrowed funds. Mr. Im disputes this fact.

[37] Mr. Im was not satisfied with Mr. Queroub’s response and escalated his complaints. He was advised that the actions taken were in accordance with CIBC ISI’s risk management and supervisory controls, policies and procedures. Mr. Im continued to complain about these actions over the following year, in person and by telephone, to various employees of CIBC and its affiliates. CIBC ISI determined that it could not sustain a relationship with Mr. Im as he was not willing to abide by the terms of his ISI margin account. On October 24, 2014, CIBC ISI advised Mr. Im that it was terminating their business relationship and that it would not accept any new business from him effective immediately, but it would continue to execute sell orders from his margin account until the account was fully liquidated.

[38] After receipt of this letter, Mr. Im complained to many people and institutions, including the Prime Minister of Canada and the Minister of Finance. On January 28, 2015, Mr. Im liquidated the ISI margin account, and it was closed shortly thereafter.

Law and Analysis

A. The test for summary judgment

[39] Under r. 20.04 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, the court shall grant summary judgment if it is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence, or if the parties agree to have all or part of the claim determined by summary judgment, and the court is satisfied that it is appropriate to grant it. Rules 20.04(2.1) and (2.2) provide the court with expanded fact-finding powers to make this determination.

[40] In accordance with Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87 (“Hryniak”), at para. 57, in order to be appropriate for summary judgment, the evidence before the court must be such that a judge is confident that she can fairly resolve the dispute.

[41] The court must first determine if there is a genuine issue requiring trial based only on the evidence before it, without using the extended fact-finding powers in r. 20.04. There is no genuine issue requiring trial if the evidence allows the court to fairly and justly adjudicate the dispute through this proportionate procedure: Hryniak, at para. 66.

[42] If there appears to be a genuine issue requiring a trial, the court must determine if the need for a trial can be avoided by using the powers in rr. 20.04(2.1) and (2.2). These powers may be used if it would not be against the interests of justice to do so: Hryniak, at para. 66.

[43] The moving party bears the evidentiary burden of showing there is no genuine issue requiring a trial. Parties are required to put their best foot forward: Canada (Attorney General) v. Lameman, 2008 SCC 14, [2008] 1 S.C.R. 372 (“Lameman”), at para. 11.

[44] In the motions before me, the facts are not contentious. I am confident that I am able to find the facts on the materials before me, and that I am able to fairly and justly adjudicate this dispute using this proportionate procedure.

B. The motions before the court

[45] There was some confusion at the outset as to which motions were being heard. In his endorsement scheduling the motions, Chalmers J. referred to both the plaintiff and the defendants seeking to bring motions for summary judgment. A schedule for the exchange of materials was established.

[46] The defendants filed their materials according to the schedule. Mr. Im served his motion materials recently. At the hearing of the motions, Mr. Im provided the court with an amended factum, as well as an amended and second amended affidavit. Although the defendants had not had an opportunity to cross-examine Mr. Im on his affidavit materials or to file responding materials on his motion, both were agreeable to proceeding with all parties’ motions for summary judgment, given the amount of overlap in the facts and arguments in the competing motions.

[47] Therefore, the court heard summary judgment motions brought by both the defendants and Mr. Im.

C. The motions by Mr. Im and BMO/InvestorLine

i) The positions of the parties

[48] Mr. Im claims summary judgment for the relief set out in his notice of motion, summarised in paragraph two above.

[49] His materials are at times difficult to follow. I agree with the following characterisation of Mr. Im’s claim against InvestorLine as set out in InvestorLine’s factum:

… applying a generous and liberal interpretation to its allegations, the Claim (as against InvestorLine) rests on the notion that InvestorLine had a positive obligation to facilitate Im's trading in the Account as he demanded, regardless of the Account's restrictions. These allegations, if properly pleaded, would sound in contract. Im also alleges InvestorLine was "negligent" in its dealings with him, and was in what he describes as a "joint-fiduciary relationship.”

[50] As Mr. Im states in his factum, “… the cause of action against Bmo … commenced on the day of the [Baidu] options expiration, September 20, 2013, when Mr. Richard Dussault, … refused to exercise the [Baidu] options despite receiving verbal instructions from the plaintiff.”

[51] I would add to InvestorLine’s summary that Mr. Im also appears to be making a claim for intentional infliction of mental suffering.

[52] Mr. Im acknowledges that there were concentration rules that applied to his InvestorLine account. However, he argues that the concentration rules did not apply to his future purchases of shares by option. Rather, he argues that the “standalone” shares in his account were a separate entity from the shares that might be purchased by way of options. Therefore, the concentration rules did not apply to the options. He maintains that CIBC ISI improperly tried to retroactively apply those concentration rules to the shares he intended to purchase by option. He argues that this was done maliciously. Mr. Im argues that the chance of a margin call was very remote, given that the Baidu stock had increased sharply. Further, because the stocks would be sold, InvestorLine faced no risk.

[53] Mr. Im also argues that InvestorLine was negligent, malicious, and breached its fiduciary duty to him by failing to provide him with sufficient time to transfer to a new brokerage once InvestorLine determined that it was not going to permit him to complete his option purchase. He states that InvestorLine knew about this intention on July 24, 2013, or certainly by early August when he wrote InvestorLine a letter with this intention. However, InvestorLine did not advise him he would need to transfer to a new brokerage if he wished to complete his share purchase until September 3, 2013 (a communication he received on September 4, 2013). Because it takes ten business days, or two calendar weeks, to transfer to a new brokerage, he had only two days to effect this transfer. Mr. Im alleges that InvestorLine manipulated the timing of the transfer request by malevolently waiting until September 3, 2013. Mr. Im argues that InvestorLine acted in bad faith, was malevolent and breached its fiduciary duty to him by failing to consider his best interest with respect to the timing of the transfer.

[54] Mr. Im complains that InvestorLine knew, through his telephone call with Mr. Dussault on Friday, September 20, 2013, that he wished to purchase the shares, but refused to do so.

[55] This is not denied by InvestorLine. It had advised Mr. Im repeatedly, and as recently as the evening before, the telephone call to Mr. Dussault, that it would not allow any purchases in the account.

[56] Mr. Im claims he was intentionally told to place the call to Mr. Dussault’s direct number, not the toll-free number, so the call would not be recorded. This is pure conjecture. There is no basis for this assertion, nor is the telephone call contentious. InvestorLine does not dispute that the call occurred in the way Mr. Im said it did – he wanted to exercise his purchase option, and Mr. Dussault advised him that InvestorLine would not permit that to happen.

[57] Mr. Im also claims that the timestamps of emails were manipulated. He argues that Mr. Dussault’s email giving instructions to move forward with the sale of the option was timestamped 3:51 p.m., while they were still on the telephone. There is no evidence that the email was not sent during the telephone call. Mr. Dussault had required Mr. Im’s instructions to be sent by 3:30 p.m., failing which the option would be sold. There is nothing improper about the email being sent, and Mr. Dussault did not have to wait until after 4:00 p.m. when the conversation ended, and the markets were closing or had closed, to send the email. Mr. Im claims Mr. Dussault was not the author of this and other emails. Again, there is no evidence to substantiate this assertion.

[58] Mr. Im states he offered InvestorLine a compromise – that he would partially exercise the option – and InvestorLine refused. InvestorLine does not dispute this.

[59] Mr. Im asks the court to draw an adverse inference in accordance with r. 20.02(1) from InvestorLine’s failure to adduce evidence from Mr. Dussault. Because the evidence about the telephone call and Mr. Dussault’s response are not disputed by InvestorLine, there was no reason for InvestorLine to put forth Mr. Dussault as an affiant. There is no adverse inference to be drawn.

[60] Mr. Im claims he suffered damages from InvestorLine’s actions set out above. He asserts his pecuniary damages can be calculated by having regard to the Baidu stock price in December 2014.

[61] InvestorLine states that it was not in a fiduciary relationship with Mr. Im, that no separate negligence is pleaded, that it was not negligent, and that InvestorLine did not breach its contractual duties. It was entitled to abide by the contractual terms, which Mr. Im had agreed to. InvestorLine does not accept Mr. Im’s statement that the option should be treated separately from the existing shares when determining concentration. InvestorLine is entitled to consider, and does consider, the account as a whole. InvestorLine argues that the claim bears the markers of a frivolous and vexatious claim, given its repeated accusations of malicious behaviour and conspiracies. InvestorLine notes that the claim of malicious conduct is belied by the fact that Mr. Im made a profit of over $90,000 from InvestorLine’s actions. InvestorLine seeks an order for judgment dismissing the claim against it in its entirety.

ii) Analysis

There is no genuine issue for trial that InvestorLine owed and breached fiduciary obligations to Mr. Im

[62] The Court of Appeal for Ontario and Supreme Court of Canada have identified five interrelated factors to be analysed when determining whether financial advisors stand in a fiduciary relationship with their clients: Hunt v. TD Securities Inc., 66 O.R. (3d) 481, at pp. 490-491, referring to Hodgkinson v. Simms, [1994] 3 S.C.R. 377. These are:

1. Vulnerability -- the degree of vulnerability of the client that exists due to such things as age or lack of language skills, investment knowledge, education or experience in the stock market.
2. Trust -- the degree of trust and confidence that a client reposes in the advisor and the extent to which the advisor accepts that trust.
3. Reliance -- whether there is a long history of relying on the advisor's judgment and advice and whether the advisor holds him or herself out as having special skills and knowledge upon which the client can rely.
4. Discretion -- the extent to which the advisor has power or discretion over the client's account.
5. Professional Rules or Codes of Conduct -- help to establish the duties of the advisor and the standards to which the advisor will be held

[63] In this case, InvestorLine was not even a financial advisor to Mr. Im. It did not advise Mr. Im on any trades or other financial matters. InvestorLine had no discretionary control of the InvestorLine account and could not invest Mr. Im’s money on his behalf. Mr. Im did not trust or rely on InvestorLine to advise him. The very opposite was true. Mr. Im sought out, and found, a platform that permitted him to direct his own trades without any advice at all. There is no genuine issue for trial that InvestorLine stood in a fiduciary relationship to Mr. Im. The relationship was, however, established by contract, the terms of which Mr. Im agreed to.

There is no genuine issue requiring a trial that InvestorLine breached its contractual obligations to Mr. Im

[64] Under the terms of the contract, as referred to above, InvestorLine retained the right to permit or reject trades and retained powers over Mr. Im’s use of margin. InvestorLine was free to determine that levels of concentration in Mr. Im’s margin account were unacceptable. It did so to protect its own interests, not those of Mr. Im, as it was entitled to do. The agreement between Mr. Im and InvestorLine specified that InvestorLine did not have to execute any trade and could impose terms on the InvestorLine account, that it was entitled to close the account if it was operated in an unsatisfactory manner, and that it could reject instructions with respect to options. InvestorLine was entitled to establish these terms and Mr. Im was entitled to accept or reject them. He chose to accept and be bound by them.

[65] Neither Mr. Im’s actions nor those of InvestorLine are in dispute. The terms of the agreement are not in dispute. While Mr. Im argues that InvestorLine should not have applied its concentration rules to his call option, there is no basis for this argument in the agreement. InvestorLine was entitled to assess the concentration in the account as it did, and to respond accordingly. Quite simply, it had no obligation to execute the trades Mr. Im wished executed.

[66] There is therefore no genuine issue requiring a trial in respect of the breach of contract allegation.

There is no genuine issue requiring a trial that InvestorLine was negligent and engaged in misrepresentation

[67] The relationship between a financial institution and its customer is governed mainly by contract: Norama Design Inc. v. CGU Insurance Company of Canada (“Norama Design Inc.”), at para. 8.

[68] The elements of negligence against InvestorLine are not pleaded. There is no duty or standard of care pleaded, nor did Mr. Im put forth any evidence of a standard of care owed by a trading platform to a user. Nor are there any allegations of misrepresentation.

[69] In argument, Mr. Im claimed that InvestorLine was negligent when Mr. Dussault received instructions to exercise the option and not close it out, and failed to follow those instructions. In the context of the contractual relationship between the parties, InvestorLine had the right to proceed in the manner it did. There is no evidence or suggestion of a failure to maintain the standard of care of a reasonable financial institution in establishing and following rules to protect against risk.

There is no genuine issue requiring a trial that InvestorLine intentionally inflicted emotional suffering

[70] In order to establish this tort, Mr. Im needs to show that InvestorLine engaged in flagrant or outrageous conduct, that the conduct was either calculated to produce harm or to occur in circumstances where it is known that harm will occur, and that he suffered actual damages as a result of the conduct: Prinzo v. Baycrest Centre for Geriatric Care, 60 O.R. (3d) 474, at p. 489.

[71] As noted above, there is no evidence of any misconduct on the part of InvestorLine. Rather, it conducted itself in accordance with the contract between it and Mr. Im. It made its rules known to Mr. Im, and then it followed those rules. Nor was any of InvestorLine’s conduct calculated to produce harm to Mr. Im. Nor was psychological harm to Mr. Im foreseeable. InvestorLine offered Mr. Im various possibilities – diversifying his account, moving to a new brokerage, or closing out the option. When InvestorLine ultimately closed the option, after notifying him it would do so, it realised a gain on his behalf.

[72] Nor is the third element of the tort established. There is no doubt Mr. Im was upset about not being able to complete his trade in the manner he wished to do so. However, he has not established that he suffered actual damages as a result of the (warranted) conduct.

iii) Summary

[73] I find Mr. Im’s claim raises no genuine issues for trial. The facts are clear and undisputed. InvestorLine did not owe Mr. Im any fiduciary duties. InvestorLine did not breach its contractual duties to Mr. Im, nor did it act maliciously or in bad faith. I do not find InvestorLine was negligent or made any misrepresentations. I do not find there is a genuine issue for trial with respect to the intentional infliction of emotional suffering. There is therefore no wrong on which his claim for damages is based. However, even if there had been such a wrong, there is no proper evidence of what the Baidu stock price was worth in December 2014, or why December 2014 is the appropriate date for assessing damages as Mr. Im suggests it is. There is no explanation for why Mr. Im did not seek to purchase the stock soon after September 20, 2013, when his InvestorLine account was closed, which would have allowed him to gain the increase to which he now says he was entitled. There is no evidence of any other damages that Mr. Im says he sustained as a result of InvestorLine’s conduct.

D) The motions in respect of CIBC/CIBC ISI

i) The positions of the parties

[74] Mr. Im claims that CIBC ISI “manipulated” the login sessions at Robarts Library and the CIBC branch. He claims that his answer to the first PVQ was “illegitimately overruled” and then claims he was not asked the same PVQ when he tried to login again. At the bank branch, he claims that he was “maliciously overruled” as he was not permitted to use the same password to access both his bank and brokerage accounts. These actions by CIBC caused delays in his trading.

[75] With respect to the trade he wished to execute at 3:59:25 p.m., Mr. Im claims that “[r]igging and non-execution of the trade was duplicitously engineered by building delays into their software and to cover up the delays”. He claims that CIBC ISI was not entitled to pause or stop the trade for manual review. He claims that margin verification must be a singular one-step automatic process. He claims he had sufficient funds to qualify for “straight-through”, or automatic, processing. He relies on Michael Lewis, Flash Boys: A Wall Street Revolt (New York: W.W. Norton & Co., 2014) for the proposition that automatic trades are completed within milliseconds.

[76] Mr. Im also claims that because he was overly preoccupied with transferring his CIBC account in late December 2014, he was unable to be with his mother when she died on December 30, 2014. This has negatively impacted his mental health. He attaches two letters, dated December 11, 2018 and April 4, 2024 from his psychiatrist, who has been treating him since 1999. The 2018 letter appears to have been written to explain the late filing of his statement of claim and to speak in favour of “an expedited and favorable resolution of the Court matters”. The 2024 letter refers to his traumatising past conflict with Questrade and speaks of his inability to meet the May 12, 2023 filing deadline for this motion.

[77] Mr. Im also makes claims that the defendants conspired to prohibit his trades.

[78] As with the InvestorLine claim, the causes of action are not always easy to interpret. His claims are best analysed as breach of fiduciary duty, breach of contract, injurious falsehood, malice or wanton malevolence, negligence and conspiracy. CIBC ISI claims that none of the causes of action raise a genuine issue for trial and that it acted completely within its contractual rights at all times. Before addressing these in turn, I will address CIBC’s limitations defence.

ii) Analysis

Is the claim statute-barred?

[79] As indicated above, Mr. Im initially claimed against CIBC ISI but amended his pleading to substitute CIBC in its place in 2019.

[80] CIBC claims the action against it is precluded by operation of the Limitations Act, R.S.O. 2022, c. 24, Sched. B.

[81] CIBC claims that Mr. Im knew of the legal difference between CIBC ISI and CIBC, evidenced by his letters to members of each organisation. Mr. Im initially elected to proceed against CIBC ISI, the holder of his margin account, and not CIBC, the holder of his chequing account. There is no issue of discoverability – it is clear that Mr. Im knew of the issue he says gave rise to his claim in 2013. CIBC would have had no reason to believe it would be a party to the claim before receiving the amended statement of claim. Mr. Im has commenced the claim against CIBC well after the two-year limitation period in the Limitations Act.

[82] Mr. Im in his factum claimed that CIBC operates CIBC ISI and states, “If Cibc and Cibc Investor Services Inc. are separate and distinct legal entities, then alternatively, the defendant can be either one.”

[83] The substance of Mr. Im’s claim is against CIBC ISI. His concern is that the transaction he attempted to make on July 24, 2013 in the ISI margin account was not executed. Mr. Im is self-represented and his materials, as well as the pleadings history, display some uncertainty on his part as to which institution was the correct legal entity to name. CIBC ISI has been aware of the claim since it was initially issued in 2015. It has argued the motions for summary judgment on their merits. It has not identified any prejudice from the motions proceeding on behalf of CIBC ISI. Accordingly, I would grant Mr. Im leave to amend the pleading to substitute CIBC ISI for CIBC and will determine the motions on their merits.

There is no genuine issue requiring a trial with respect to the claim that CIBC ISI was in a fiduciary relationship with Mr. Im

[84] For the reasons set out in paragraphs 62 and 63 above with respect to InvestorLine, I find that CIBC ISI did not owe any fiduciary duties to Mr. Im.

There is no genuine issue requiring a trial in respect of Mr. Im’s claim that CIBC ISI breached its contractual obligations

[85] The EAA which governs the relationship between CIBC ISI and Mr. Im is clear and unambiguous. The facts to which the EAA applies are not in dispute. CIBC ISI was entitled to require Mr. Im to correctly answer PVQs in order to access his accounts. The EAA permits CIBC and CIBC ISI to restrict access to a customer’s accounts where PVQs are not answered correctly or where fraudulent activity is suspected. The EAA also provides the CIBC entities with sole discretion to decline to act on instructions provided electronically. The CIBC entities, by contract, retain the right to reject, change or remove any instruction, or to cancel any trade. Instructions were specifically subject to any additional requirements that CIBC ISI might impose. CIBC ISI was acting within its contractual rights when it denied access to Mr. Im’s accounts the first two times and was within its contractual rights to reject his electronic instruction to trade and subject it to manual review. The EAA does not provide Mr. Im with a right to straight-through, or automatic, processing without manual review. Nor does the EAA require CIBC ISI to process trades instantaneously.

There is no genuine issue requiring a trial in respect of Mr. Im’s claim that CIBC ISI engaged in injurious falsehood, malice or wanton malevolence.

[86] To sustain this claim, Mr. Im would have to establish that the CIBC entities published false statements, reflecting adversely on him, calculated to induce others not to deal with him. The statements must be untrue, made maliciously, and Mr. Im must have suffered special damages as a result: Lysko v. Braley (2006), 79 O.R. (3d) 721 (Ont. C.A.), at p. 761.

[87] There is no evidence, and indeed no claim, that CIBC or CIBC ISI published any statements about Mr. Im and his accounts with the CIBC entities orally or in writing. There are no statements said to be untrue or made maliciously about Mr. Im.

[88] The facts and the claim raise no genuine issue for trial in respect of this tort.

There is no genuine issue requiring a trial in respect of Mr. Im’s claim that CIBC ISI was negligent

[89] As noted above, the relationship between a financial institution and its customer is governed generally by the contract between them: Norama Design Inc., at para. 8.

[90] Mr. Im has not put forth any evidence or argument that either CIBC entity failed to maintain the standard of care of a reasonable financial institution. The entities have clearly established procedures and protocols for electronic banking intended to minimise opportunities for fraudulent activity, thereby protecting themselves and their customers. They investigated his trade request and his complaints. As noted, on a summary judgment motion parties are required to put their best foot forward: Lameman, at para. 11.

[91] There is a complete absence of evidence to support the bald assertion of negligence. There is no triable issue that either CIBC entity was negligent.

There is no genuine issue requiring a trial in respect of Mr. Im’s claim of conspiracy

[92] In order to establish a claim for conspiracy, Mr. Im must show that two or more parties agreed to commit an unlawful act or a lawful act by unlawful means. Predominant purpose conspiracy is established when the predominant purpose of the defendant’s conduct is to cause injury to the plaintiff using either lawful or unlawful means, and the plaintiff suffers loss as a result. Unlawful means conspiracy is established when the defendant’s unlawful conduct is directed toward the plaintiff, the defendants should know injury to the plaintiff is likely to result, and injury does in fact result: Pro‑Sys Consultants Ltd. v. Microsoft Corporation, 2013 SCC 57, [2013] 3 S.C.R. 477, at paras. 72, 74 and 80.

[93] Again, Mr. Im has only baldly stated that there was a conspiracy against him. He can point to no discussions between CIBC ISI and any entity, and no directions from CIBC ISI to any entity, to limit his ability to trade. No unlawful conduct is revealed, nor is there any lawful conduct whose predominant purpose is to cause injury to Mr. Im.

[94] There is no issue requiring a trial with respect to the claim of conspiracy.

iii) Summary

[95] As with the claim against InvestorLine, I find that the claim against CIBC ISI raises no genuine issues requiring a trial. The evidence on both claims is uncontested. Mr. Im’s claims are essentially that he should be permitted to execute margin trades however he wants without limitation and without regard to contractual terms, and that institutional review of trades and fraud prevention measures are impermissible. These claims raise no genuine issue for trial.

Disposition

[96] Mr. Im’s motion for summary judgment is dismissed. BMO/InvestorLine’s and CIBC/CIBC ISI’s motions for summary judgment are granted. Mr. Im’s claims are dismissed in their entirety and the litigation is at an end.

[97] The parties are encouraged to agree on costs. Should they be unable to do so, the defendants may provide costs submissions of no more than three pages double spaced within seven days. Mr. Im shall have seven days to respond, with the same page limits. There shall be no reply submissions without leave. These submissions may be sent to my judicial assistant at linda.bunoza@ontario.ca.

L. Brownstone J.

Released: September 4, 2024