Scott McGrath

The moving party plaintiff brought a motion to strike the defences of multiple defendants who had repeatedly failed to comply with court orders requiring payment of costs and delivery of affidavits of documents.

The court applied the test from Falcon Lumber, considering whether the failures were deliberate, clear and unequivocal, whether reasonable explanations were provided, and whether the remedy was proportionate.

The court found the failures of four defendants — including a corporate defendant whose sole director is not a lawyer and who had not retained counsel as ordered — to be deliberate and unexcused, warranting the striking of their defences.

One defendant whose obligations had been fulfilled on the eve of the motion was spared.

The defendants whose defences were struck were ordered to pay costs jointly and severally.

The decision addresses motions by First Trust Management AG, as Trustee of The Salus Rete Trust, to stay or dismiss two related actions on the basis that Ontario lacks jurisdiction or is not a convenient forum.

The court finds that the claims are adequately pleaded, that Ontario has jurisdiction simpliciter based on several presumptive connecting factors (including contracts made in Ontario and torts committed in Ontario), and that Ontario is the most appropriate and convenient forum for the actions.

The motions are dismissed.

This decision sanctions the CCAA Plans of Imperial Tobacco Canada Limited, Imperial Tobacco Company Limited, JTI-Macdonald Corp., and Rothmans, Benson & Hedges Inc., effecting a global settlement of all tobacco-related claims in Canada.

The court reviews the structure, allocation, and fairness of the plans, including the creation of a $1 billion Cy-près Foundation, and addresses objections from social stakeholders.

The court finds the plans fair, reasonable, and in the public interest, and grants the requested relief, including third-party releases and the appointment of plan administrators.

This supplementary endorsement addresses a request from JTI-Macdonald Corp. regarding the adequacy of notice elements in the Claims Procedure Order within the ongoing Companies' Creditors Arrangement Act (CCAA) proceedings.

The court confirmed its satisfaction that the notice elements in the Claims Procedure Orders are reasonable in the circumstances, addressing an oversight from previous submissions.

The Superior Court of Justice addressed multiple motions within the complex Companies’ Creditors Arrangement Act (CCAA) proceedings of JTI-Macdonald Corp., Imperial Tobacco Canada Limited, Imperial Tobacco Company Limited, and Rothmans, Benson & Hedges Inc. The court granted a stay extension until January 31, 2025, and approved Meeting Orders and Claims Procedure Orders.

These orders facilitate the advancement of comprehensive Plans of Arrangement, developed by the court-appointed Mediator and Monitors, aiming for a Pan-Canadian global settlement of tobacco claims totaling $32.5 billion.

The court found the plans were not "doomed to fail" despite outstanding issues regarding financial allocation among the Tobacco Companies and the creditor status of JTI-Macdonald TM Corp.

The appellant, 2649360 Ontario Inc., appealed a motion decision that granted Grant Thornton Limited, as Trustee in Bankruptcy for Aiden Pleterski and AP Private Equity Limited, relief from forfeiture of a $500,000 real estate purchase deposit.

The deposit was paid by Pleterski using misappropriated investor funds for a property that was subsequently not purchased due to bankruptcy.

The motion judge applied the two-part test for relief from forfeiture (disproportionate to damages and unconscionable to retain) and ordered the deposit returned to the Trustee for the benefit of creditors.

The appellant argued the motion judge erred by considering creditor interests and by characterizing Grant Thornton as "innocent." The Court of Appeal dismissed the appeal, affirming that the motion judge was entitled to consider the full commercial context, including the source of funds and the benefit to creditors, and that a party causing breach is not absolutely barred from relief from forfeiture.

The court found no error in the discretionary decision.

The court determined the scale and quantum of costs following previous motions.

Primont Homes (Vaughan) Inc. sought substantial indemnity costs, arguing delay and unproven fraud allegations by the defendants, Maplequest (Vaughan) Developments Inc. and 2373480 Ontario Inc. The defendants argued for reduced partial indemnity costs due to mixed success and over-lawyering by Primont.

The court found partial indemnity was appropriate, rejecting substantial indemnity as the fraud allegations were not adjudicated on their merits.

The court also reduced Primont's requested quantum due to its unsuccessful abuse of process argument and duplicative work by its multiple timekeepers, ultimately awarding $140,000.00 in partial indemnity costs.

The plaintiffs brought a motion seeking the appointment of an interim receiver over the shares of one of the defendants in several companies involved in land development projects.

The parties, who are shareholders in these companies, had a significant falling out, leading to defaults on secured loans.

The plaintiffs argued that a receiver was necessary to refinance debt and maximize value.

The court determined that the appropriate test for the interlocutory receiver appointment was the RJR MacDonald test, with an elevated 'strong prima facie case' standard due to the Mareva-like nature of the relief.

The court found that the plaintiffs failed to meet the merits requirement, as they asserted no legal or beneficial interest in the defendant's shares and the memorandum of understanding did not obligate the defendant to contribute further funds.

Furthermore, the court found no irreparable harm and that the balance of convenience did not favor the appointment, concluding that a receivership was not an appropriate remedy for a shareholder dispute where the moving party sought to eliminate the other party's control over their own shares.

The plaintiff, Primont Homes (Vaughan) Inc., sought an interlocutory injunction to prevent the defendants, Maplequest (Vaughan) Developments Inc. and 2373480 Ontario Inc., from dealing with certain land lots, asserting a contractual right to acquire them.

The defendants moved to dissolve an existing interim injunction, arguing the plaintiff failed to provide an adequate undertaking as to damages and made material non-disclosures.

The court dismissed the defendants' motions to dissolve the interim injunction, finding them precluded by Rule 2.02 due to significant delay.

The court then granted the plaintiff's motion for an interlocutory injunction, determining there was a serious issue to be tried regarding the enforceability of the agreement and entitlement to specific performance, that the plaintiff would suffer irreparable harm due to the primary defendant's inability to satisfy a damages award, and that the balance of convenience favored maintaining the injunction.

The court also found the plaintiff's undertaking as to damages sufficient given the defendants' failure to quantify their potential damages from delay.

The Court of Appeal for Ontario heard an appeal and cross-appeal concerning the interpretation of an easement.

The primary issue was whether an easement for "vehicular and pedestrian access and egress" included the right to park.

The application judge had ruled it did not.

The appellant (Friuli Long Term Care) argued the application was speculative and that parking rights were ancillary or an easement of necessity.

The cross-appellant (Primont (Castelmont) Inc.) sought an additional declaration regarding redevelopment.

The Court of Appeal dismissed both the appeal and the cross-appeal, affirming the application judge's finding that the easement did not include parking rights and that parking was a contractual matter.

The court also upheld the refusal of the additional declaration due to procedural issues.

The applicant, Link 427 General Partnership, sought to enforce an interim arbitral order compelling two non-parties, Fay Marzuq and Melissa Raffoul, to attend examinations for discovery.

The court dismissed the application, holding that an arbitrator lacks jurisdiction over non-parties to an arbitration agreement, and therefore the court would not enforce such an order.

The court also noted, as an alternative reason for dismissal, that the information sought from the non-parties had already been provided.

SPay Inc. sought leave to appeal a motion judge's decision not to stay a receiver's motion for judgment in favour of international arbitration.

The motion judge had ruled that the arbitration provisions were inoperative due to Ontario's "single proceeding model" in insolvency cases, finding SPay was not a "stranger to the bankruptcy" because its proposed set-off against Mundo Media Ltd.'s largest account receivable effectively made it a creditor.

The Court of Appeal dismissed the motion for leave to appeal, concluding that the proposed appeal lacked prima facie merit and did not raise issues of general importance.

The court affirmed that insolvency courts have broad discretion to centralize proceedings, and that a party asserting a significant set-off is not a stranger to the insolvency, thus falling under the single proceeding model.

The applicants sought a vesting order for adverse possession or, alternatively, a prescriptive easement over a strip of land used as a driveway.

The court found that both parties overreached in their claims and settlement positions, with neither side achieving what they sought.

The court declined to award costs to either party, emphasizing that the litigation was an artificial proxy for a broader neighbour dispute regarding renovations.

No order as to costs was made.

The applicants sought a prescriptive easement over a strip of the respondent's land that had been used as part of their driveway for nearly fifty years.

The court found that the applicants' predecessors in title had openly and continuously used the strip of land for parking and access from 1983 to 2003, prior to the lands being registered under the Land Titles Act.

The court concluded that the easement was reasonably necessary for the better enjoyment of the applicants' land and granted the application.

Following cross-motions for summary judgment where the plaintiff was successful in recovering the residual proceeds of a power of sale, the court determined costs and prejudgment interest.

The court awarded the plaintiff costs of $45,515.37, noting the plaintiff beat its Rule 49 offer and the defendants unreasonably rejected a settlement proposal.

The court also awarded prejudgment interest at 2% from the date of the power of sale.

The applicant brought an application to interpret two promissory notes representing a $900,000 loan from the respondent for a real estate development project.

The parties disputed whether interest should be compounded, whether an interest escalation clause was triggered, and whether the second promissory note contained a mistake requiring rectification.

The court held that there was no agreement for compound interest and that the interest escalation clause was not triggered because the project was not fully constructed.

The court also rectified the second promissory note to remove the interest escalation clause while maintaining the 20% base interest rate.

The applicant was ordered to pay the remaining $99,778 owed under the notes, and was awarded $25,000 in partial indemnity costs due to divided but primarily successful outcomes.

This motion, brought by SPay Inc., sought to stay a claim by Mundo Media Ltd.'s court-appointed Receiver, arguing the dispute should proceed via arbitration in New York as per their contracts.

The Receiver claimed SPay owed Mundo $4.1 million, while SPay intended to assert a set-off.

The court declined to follow the British Columbia Court of Appeal's reasoning in Petrowest Corporation v. Peace River Hydro Partners regarding a receiver's ability to disclaim arbitration clauses.

Instead, the court applied the "single proceeding model" in insolvency, finding that SPay was not a "stranger to the bankruptcy" due to the significant receivable and SPay's intention to assert a set-off.

The court held that justice and practicality demanded the claims be resolved within the Ontario receivership proceedings, rendering the arbitration agreement inoperative under Article 8(1) of the UNCITRAL Model Law.

The motion for a stay was dismissed, and costs were awarded to the Receiver.

The applicant sought a declaration that mutual easements among the parties, which granted rights for vehicular and pedestrian access and egress, did not include the right for users to park on each other's lands.

The court found that the easements unambiguously dealt only with access and egress, and that parking rights were contractual obligations established through separate agreements, such as a Site Plan Agreement and a tripartite agreement, rather than property rights conveyed by the easements.

The application was granted, and the counter-application was dismissed.

The defendants brought a motion for leave to amend their statement of defence to withdraw an admission that they had entered into a conditional agreement of purchase and sale for a farm.

The plaintiff opposed the withdrawal.

The court applied the three-part test for withdrawing an admission and found that the proposed amendment raised a triable issue, as one of the three joint tenants had not signed the agreement.

The court also found that the admission was inadvertent and that there was no prejudice to the plaintiff, who had known from the beginning that the document was missing a signature.

The motion was granted.

The plaintiff sued for specific performance of an agreement of purchase and sale, alleging the defendants acted in bad faith by relying on a solicitor approval condition to annul the deal.

The plaintiff brought a motion seeking a ruling that the defendants impliedly waived solicitor-client privilege by pleading they acted in good faith on their solicitor's advice.

The court dismissed the motion, finding that the defendants did not base their defence on their state of mind, but merely answered the bad faith claim, and that the solicitor approval clause gave them an absolute right to cancel without waiving privilege over the solicitor's reasons.