Corporate/Commercial Law - SCJ

This endorsement concerns costs following the setting aside of a Mareva injunction against the defendant, Ms. Chang, due to the plaintiff's principal's failure to make full, fair, and frank disclosure.

Ms. Chang sought substantial indemnity costs, while the plaintiff proposed a significantly lower amount.

The court considered factors under Rule 57.01 of the Rules of Civil Procedure, including the defendant's success on the injunction motion and the plaintiff's principal's inappropriate conduct.

Costs were fixed at $20,000, payable jointly and severally by the plaintiff corporation and its principal, Mr. Deng, due to his misconduct and to prevent Ms. Chang, a minority shareholder, from effectively paying her own costs.

The applicant, Dennis Marchand, brought a motion to add Christine Denis and 8766177 Canada Inc. as parties to an existing oppression remedy application under section 241 of the Canadian Business Corporations Act.

Marchand alleged that the original respondents, Stuart Graham and David Harroch, dissolved their shared company (7104383 Canada Inc.) and subsequently operated a new hockey tournament through Christine Denis's company (8766177 Canada Inc.).

The court dismissed the motion, finding no evidence that Denis or 8766177 Canada Inc. were involved with the original corporation or were affiliates, thus lacking a foundation for a cause of action under section 241 of the CBCA against them.

Following an eight-day trial where the Ottawa Convention Centre Corporation (OCCC) succeeded on its claim and treefort Hip Productions Inc.'s counterclaim was dismissed, the court addressed the issue of costs.

OCCC sought substantial indemnity costs of over $400,000.

The court found that while OCCC's pre-litigation offer demonstrated reasonableness, it did not, by itself, warrant substantial indemnity costs.

However, treefort's unsubstantiated allegations of bad faith, fraud, and dishonesty against OCCC and its senior executives were deemed serious enough to fall into the "special and rare" category justifying substantial indemnity costs, limited to the costs of attending at trial.

The court awarded OCCC costs of $320,000, inclusive of disbursements and taxes.

The applicant company sought to fix the fair market value of common shares held by dissenting shareholders who opposed amendments to create convertible preferred shares.

The court rejected the applicant's liquidation approach to valuation, instead valuing the company as an ongoing concern using the discounted cash flow (DCF) method.

The court determined that a three-month time delay in the commencement of projected cash flows was appropriate, balancing the company's straightened financial circumstances with its ongoing viability.

The "en bloc" fair market value was fixed at $12,300,000, resulting in a per share value of $0.304.

The Toronto-Dominion Bank sought judgment against a corporation and its personal guarantors for a defaulted small business loan.

The guarantors, a married couple, sought a declaration that their personal guarantees were invalid, arguing they were misled about the extent of their liability (believing it was limited to 25% of the outstanding loan, not unlimited as indicated by an 'x' in the form).

The court found the guarantees were unlimited, rejected arguments based on CSBFA regulations as irrelevant to the bank-customer relationship, and dismissed the non est factum defence due to the guarantors' failure to read the documents and the presence of a "no representations" clause.

Judgment was granted in favour of the bank.

The plaintiffs sought an interlocutory injunction to prevent the sale of a medical clinic, asserting a right of first refusal (ROFR).

The court found the plaintiffs' case for an ROFR to be very weak, noting that the condition precedent for the ROFR (plaintiff acting as Medical Director and Quality Advisor without compensation) was never fulfilled.

Furthermore, the court found no irreparable harm, as the third-party purchaser offered to continue the plaintiff's association agreement, and the plaintiff's claims of uniqueness for the clinic were speculative.

The balance of convenience also favored dismissing the injunction, as granting it would cause significant harm to the defendants and potentially the clinic's operations.

The interim injunction was terminated, and the request to continue it was denied.

The court issued its third and final set of reasons following a hearing on June 27, 2018, confirming an interim ruling and addressing costs.

The court drew negative inferences against Greyslone Ltd., Belview Management Ltd., and Mr. Czerlau due to evasive conduct and lack of corporate authority, disallowing claims of privilege over solicitors' files.

It ordered all solicitors' files (Assuras, Lof, Brown) to be delivered to an Independent Supervising Solicitor for review and production of relevant documents to the plaintiff.

The court awarded substantial indemnity costs of $19,878.53 against Mr. Czerlau, Greyslone Ltd., and Belview Management Ltd. jointly and severally, and partial indemnity costs of $13,626.70 against Ms. Assuras, also jointly and severally with the others to that extent.

The plaintiff, Car-Wal Garage Doors Inc., brought a motion for an interlocutory injunction to restrain the defendant, On Track Door Systems Canada Inc., from using the trade name "On Track" and the domain name "ontrackdoorsystems.ca".

The plaintiff alleged the defendant's actions constituted passing off, causing confusion and damaging goodwill, particularly after the expiry of a previous licence agreement.

The defendant cross-moved to strike the claim, arguing res judicata or abuse of process.

The court applied the three-part test for interlocutory injunctions, finding a serious issue to be tried regarding passing off, a risk of irreparable harm to the plaintiff's goodwill and market share, and that the balance of convenience favoured the plaintiff.

A limited injunction was granted, restraining the defendant from using "On Track" in its name except for "On Track Door Systems Grey Bruce Inc." and from using the specified domain name.

Raymond James Ltd. (RJL) successfully obtained summary judgment against Jayanth Noronha for a forgivable loan and dismissal of his $2.0 million counterclaim.

RJL sought costs on a full indemnity basis, relying on an indemnification clause in the Agency Agreement and Noronha's unsubstantiated allegations of bad faith.

The court awarded RJL full indemnity costs of $93,403.10, finding the indemnification clause valid and Noronha's conduct prolonged the litigation, making the requested costs reasonable and fair.

The plaintiff's construction lien action was dismissed, and the defendants' counterclaim was allowed.

This decision addresses the defendants' request for full indemnity costs against the plaintiff corporation and its principals due to egregious conduct during litigation.

The court awarded full indemnity costs against the plaintiff corporation and one principal jointly and severally, finding that principal engaged in fraud, fabricated evidence, and repeatedly lied.

Costs were not awarded against another principal, as their misconduct was not directly related to the litigation.

The plaintiff, a travel wholesaler, sought summary judgment against the defendant travel agency for unpaid airline tickets totaling $312,964.10, which were charged back after fraudulent credit card payments.

The defendant argued it was a "middleman" or agent of the plaintiff and not liable.

The court found a direct contractual relationship between the plaintiff as a wholesale seller and the defendant as its customer, making the defendant responsible for payment.

The court rejected the agency argument due to lack of evidence of consent, control, or authority to affect the principal's legal position.

Judgment was awarded to the plaintiff.

The plaintiff, Azmoon Trading Inc., sought to alter a previous costs award in favour of the defendants, Caffe Demetre Franchising Corp. et al., following the dismissal of an injunction motion.

Azmoon Trading argued that costs should be borne by each party due to similar incurred costs and ongoing litigation, and challenged specific disbursements related to the defendants' counsel retaining lawyers from London, Ontario.

The court confirmed the original costs award of $41,670.61 to Caffe Demetre, finding that the successful party is presumptively entitled to costs, and that retaining counsel from a different municipality, even if it incurs additional travel disbursements, is generally permissible and reasonable if the overall costs are fair.

This addendum to a prior summary judgment decision (2018 ONSC 4978) corrects the amount owing on a mortgage and clarifies the post-judgment interest rate.

The court had previously misstated the amount owing.

The corrected mortgage debt as of August 16, 2018, is $2,841,580.55, and post-judgment interest is to accrue at the rate specified in the mortgage.

The defendant agreed to the corrected amount and took no position on the interest rate.

The applicant mother brought a motion seeking a Mareva injunction to restrain her daughter, a respondent, from depleting assets in two corporations controlled by the daughter.

The mother also sought an order for questioning of the daughter and corporate respondents.

The court dismissed the Mareva injunction, finding that the applicant failed to demonstrate a serious risk of asset dissipation or irreparable harm, noting that assets transferred between the daughter's wholly-owned corporations remained traceable.

The motion for questioning was adjourned pending a disclosure motion.

This ruling addresses the scope of redactions to be applied to public court documents related to a prior non-publication order granted to "Person X." The court balanced the applicant's privacy interests in preventing direct or indirect identification with the public's right to access information, particularly as advocated by media interveners.

The judge approved most of the applicant's proposed redactions but rejected some, allowing general, non-identifying information about Person X's personal circumstances, professional reputation, and the fact of being a target of a Competition Bureau investigation to remain in the public record.

The ruling also vacated a previous sealing order and varied an *in camera* order.

The defendants brought a motion to stay the proceeding, arguing that Ontario courts lacked jurisdiction or, alternatively, that Ontario was forum non conveniens due to a forum selection clause designating England.

The court found jurisdiction simpliciter in Ontario based on contract formation principles but ultimately granted a stay on the basis of forum non conveniens, giving effect to the forum selection clause.

The Bank of Nova Scotia brought a motion for summary judgment against 1934047 Ontario Inc. and Ogieriakhi Omozusi for outstanding debts under an overdraft facility, a term loan, and a credit line, all of which were in default.

Omozusi had also guaranteed the corporation's debts.

The defendants acknowledged the indebtedness and default but sought a stay of enforcement and leave to pay at a negotiated rate, and also sought to amend their statement of defence to include a counterclaim for business interruption losses.

The court found no genuine issue requiring a trial, affirming the Bank's contractual right to demand full repayment.

The proposed counterclaim was deemed without merit and leave to amend was denied.

Summary judgment was granted in favour of the Bank for the full amounts owing plus interest.

The applicant sought an oppression remedy or winding-up order against his brother and the family business, Clifton Plastics Ltd., regarding payments made to the brother after their father's retirement and subsequent incapacity.

The respondent brought a counter-application for an accounting and wrongful dismissal damages.

The court found no oppression but ordered a winding-up under s. 207 of the OBCA, requiring the applicant to purchase the respondent's shares at fair market value, reduced by $35,000 due to unequal contributions, and without attributing value to alleged shareholder loans.

The defendants Chamath Palihapitiya and El Investco 1 Inc. brought a motion for summary judgment, arguing the plaintiffs lacked evidence for their claims, particularly conspiracy.

The plaintiffs opposed, asserting that the conspiracy claims against the moving parties could not be severed from claims against other defendants not party to the motion.

The court dismissed the motion, finding that granting summary judgment for a subset of defendants risked inefficiencies, conflicting findings, and multiple appeals, especially given the proximity of the trial and the intertwined factual matrix.

Carole Farah brought a motion to set aside default judgment and a noting in default, along with a Writ of Seizure and Sale, arguing she was not personally liable on a promissory note signed on behalf of a corporation.

The court granted the motion, finding that Farah moved promptly, had a plausible explanation for default, and raised an arguable defence regarding corporate versus personal liability.

The court also noted the plaintiff's failure to disclose Farah's personal email address during the substituted service application.

The default judgment, noting in default, and all executions against Farah were set aside, and costs were awarded to Farah.