Sean F. Dunphy

The plaintiff landlord brought a summary judgment motion against four indemnitors of a commercial lease.

The indemnitors argued they were released from their obligations because the tenant had not been in 'habitual default' during the first three years, and alternatively, that the landlord waived prior defaults in an assignment agreement.

The court found that repeated late payments of rent constituted habitual default, preserving the indemnities.

The court also rejected arguments of waiver, failure to mitigate damages, and non est factum raised by one indemnitor.

Summary judgment was granted in favour of the landlord for $239,052.33.

Following dismissal of a plaintiff’s summary judgment motion in a wrongful dismissal action, the court determined costs.

The defendant had made a written settlement offer that was more favourable to the plaintiff than the ultimate outcome and would have avoided further litigation.

The court held that although the strict cost consequences of Rule 49.10 did not apply to a successful defendant, the offer remained a relevant factor under Rules 49.13 and 57.01 in exercising discretion on costs.

The court also considered the plaintiff’s failure to proceed under the simplified procedure in Rule 76 despite the claim falling within its monetary threshold.

Partial indemnity costs were awarded up to the date of the offer and substantial indemnity costs thereafter.

The applicants sought rectification of transaction documents following the acquisition of a telecommunications partnership in order to allow executives who exercised stock options to qualify for the 50% stock option deduction under the Income Tax Act.

The closing structure caused the option shares to be acquired by non‑arm’s‑length vendors rather than by the purchaser, leading the Canada Revenue Agency to deny the deduction.

The court held that rectification requires proof of a prior agreement and common intention that the written instrument failed to record, or strict conditions for unilateral mistake.

The evidence did not establish that the tax treatment of the executives was a shared or material intention of the contracting parties when the agreement was executed.

Unexpected tax consequences alone could not justify retroactively restructuring a completed transaction through rectification.

The defendant, Romandale Farms Limited, brought a motion for leave to amend its statement of defence, add third parties, consolidate actions, and dissolve a 2007 interlocutory injunction in a complex commercial real estate dispute.

The plaintiff opposed the amendments, arguing prejudice, res judicata, and withdrawal of an admission.

The court granted leave to amend, finding no non-compensable prejudice and that the proposed defences were tenable and responsive to the plaintiff's amended claims regarding a partial settlement agreement.

The court also joined one third party for limited purposes to avoid multiplicity of proceedings and dissolved the 2007 injunction, as the plaintiff no longer claimed a proprietary interest in the land.

The plaintiffs transferred their family home to the defendant in 1996 to avoid creditors, executing a sham agreement of purchase and sale.

The plaintiffs remained in the home, paid the defendant's mortgage costs, and made significant improvements, believing they retained beneficial ownership.

When the defendant refused to return the property, the plaintiffs sued.

The court found the transaction was a sham and the defendant was unjustly enriched.

Applying section 37 of the Conveyancing and Law of Property Act, the court ordered the property transferred back to the plaintiffs, subject to them paying compensation to the defendant based on the 2005 fair market value minus credits for the unjust enrichment and improvements.

The defendant's separate action for an old loan was dismissed as repaid and statute-barred.

The plaintiffs transferred their family home to the defendant in 1996 in a sham transaction designed to defeat creditors, with an oral agreement that the defendant would hold the property in trust.

The plaintiffs remained in the home, paid the defendant's mortgage costs, and made significant improvements.

When the defendant refused to return the property, the plaintiffs sued.

The court found the transaction was a sham and the defendant was unjustly enriched.

Applying section 37 of the Conveyancing and Law of Property Act, the court ordered the property transferred back to the plaintiffs, subject to them paying compensation to the defendant.

The defendant's separate action on a 1989 promissory note was dismissed as statute-barred and fully repaid.

Following acceptance of a Rule 49 offer to settle shortly before a hearing, the court determined the appropriate costs payable to the plaintiffs up to the date of the offer.

The plaintiffs had claimed more than $700,000 but settled for $84,042 plus costs.

Applying the factors under Rule 57.01 of the Rules of Civil Procedure and considering the proportionality principles reflected in Rule 76, the court found the plaintiffs’ requested costs excessive given the modest settlement relative to the claim.

The court emphasized the importance of proportional litigation and the costs consequences of advancing inflated claims.

Partial indemnity costs were awarded at a reduced amount.

Following a successful summary judgment motion dismissing the plaintiff’s claim and granting judgment on a counterclaim subject to later assessment of damages, the defendants sought costs on a full indemnity basis.

The court reviewed the defendants’ claimed hours and rates in light of the Civil Procedure Rules Committee grid, the indemnity principle, and the factors under Rule 57.01 and s.131 of the Courts of Justice Act.

The court found the time expended and rates claimed to be reasonable and determined that the litigation conduct of the plaintiff reflected tactical litigation intended to harm a competitor.

While recognizing the discretion to award costs against corporate principals, the court declined to pierce the corporate veil due to insufficient evidentiary foundation.

Costs of $58,878.22 inclusive of HST and disbursements were awarded to the defendants.

Following the dismissal of an urgent anti-suit injunction application, the court determined the appropriate costs award.

The court found that the moving parties had manufactured urgency despite having months of advance notice of the foreign proceeding they sought to enjoin, and had delivered voluminous materials on extremely short notice, impairing the responding parties’ ability to respond.

The court concluded the litigation strategy was tactical and inconsistent with the Rules of Civil Procedure and principles of fairness.

As a result, the court awarded substantial indemnity costs to the successful responding parties.

The court fixed the costs award at $27,500 as fair and reasonable in the circumstances.

The plaintiff, an unpaid trade creditor on a townhouse development project, brought an action against the director of the corporate owner for breach of trust under the Construction Lien Act.

The corporate owner had sold all units but failed to pay the plaintiff in full, and the director subsequently declared personal bankruptcy.

The court dismissed the action, finding that the corporate owner was not a 'contractor' under section 8 of the Act, and therefore no trust funds existed.

Consequently, the director could not be held personally liable under section 13, and there was no evidence of dishonesty to prevent the release of claims through his bankruptcy discharge.

The plaintiff brought a motion for summary judgment seeking a declaration that the termination provisions in his employment agreement were unenforceable and that he was entitled to common law reasonable notice.

The agreement limited termination notice to the minimum required by the Employment Standards Act, 2000 (ESA).

The court rejected arguments that the employer had repudiated the agreement or that the termination clause was void for contracting out of ESA minimum standards or for ambiguity.

Applying contractual interpretation principles and the agreement’s severability clause, the court held the termination provision valid and enforceable.

The motion was dismissed and the ESA-based termination provision governed the notice entitlement.

The third party moved to stay a third party claim on the basis of a forum selection clause in a guarantee agreement governed by German law that designated the courts of Hannover, Germany as the competent forum.

The defendants argued the claim should proceed in Ontario alongside the main action concerning breaches of warranty under a share purchase agreement.

Applying the “strong cause” test from Supreme Court of Canada jurisprudence, the court held that forum selection clauses in international commercial contracts are presumptively enforceable unless exceptional circumstances justify departure.

The defendants failed to demonstrate such circumstances, as the possibility that witnesses and related litigation were located in Ontario was reasonably contemplated when the parties agreed to the clause.

The third party claim was stayed in favour of the Hannover courts.

The plaintiff sought an interlocutory injunction restraining a former employee and his new company from soliciting or servicing any past or present customers.

The plaintiff alleged the employee was a fiduciary who breached duties by leaving on short notice and soliciting clients.

The court held the plaintiff failed to establish a strong prima facie case that the employee was a fiduciary or that any continuing breach of fiduciary duty existed.

Evidence of irreparable harm was speculative and limited, and the balance of convenience favoured permitting lawful competition by the former employee’s start‑up business.

The motion for an interlocutory injunction was dismissed with costs.

A wrongful dismissal action proceeded by summary judgment to determine whether the employee failed to mitigate her damages by declining a new employment offer from a successor firm.

The employee, a long‑term administrative staff member, sought clarification and attempted to negotiate aspects of the proposed contract, including salary, probation, vacation restrictions, and other materially different terms.

The employer argued the refusal to accept an equivalent position defeated mitigation.

The court held that the burden to prove failure to mitigate rests with the employer and was not met because the proposed employment contained materially less favourable terms and the employee acted reasonably in seeking clarification and negotiation.

Summary judgment was granted and damages for reasonable notice were awarded.

The plaintiffs, an Ontario-based equity research company and its founder, published a negative research report about the defendants, Indian corporations.

The defendants commenced a defamation action in India and obtained an anti-suit injunction against the plaintiffs.

The plaintiffs subsequently brought an action in Ontario and sought an urgent interlocutory anti-suit injunction to restrain the defendants from proceeding with their Indian action and from pursuing contempt proceedings against a witness in India.

The court dismissed the motion, finding that while there might be a serious issue to be tried regarding the appropriate forum, the plaintiffs failed to establish irreparable harm and the balance of convenience favoured the status quo due to the plaintiffs' delay in seeking relief.

The plaintiff employee moved to Ottawa for family reasons and sought to telecommute to his Toronto-based job.

The employer agreed only on the condition that the plaintiff sign a new fixed-term employment contract.

When the contract was not renewed, the plaintiff sued for wrongful dismissal, arguing the new contract was void for lack of consideration, duress, lack of agreement, and breach of the Employment Standards Act.

The court dismissed the motion for summary judgment and the action, finding the contract was validly formed with consideration and without duress.

While an early termination clause violated the ESA, it was severable, and the fixed-term provision remained valid.

Multiple insurers disputed their duty to defend an insured chemical delivery company arising from two actions following a chlorine gas release at a public pool.

The insured and one insurer sought declarations compelling other insurers to contribute to defence costs.

Applying the pleadings rule from Monenco and related appellate authorities, the court held that the possibility of coverage under the policies triggered the duty to defend and that extrinsic evidence could not be used to prematurely determine factual causation issues.

The court also rejected an argument that defence cost coverage depended on insurer consent.

Principles of equitable contribution required all insurers with potential coverage to share defence costs.

The appellants appealed a decision of the Deputy Mining and Lands Commissioner denying them permission to build a home on their land due to flood control concerns raised by the Nottawasaga Valley Conservation Authority.

The Divisional Court allowed the appeal, finding that the Tribunal erred in law by presuming a general legislative prohibition on development in floodplains and by elevating safety to a stand-alone head of jurisdiction.

The Court held that the proposed development would have no impact on flood control and directed the approval of the development without conditions.

The applicant, a paralegal, sought judicial review of a Law Society appeal panel decision that set aside findings of professional misconduct against him but directed a new hearing rather than staying the proceedings.

The applicant argued the appeal panel breached procedural fairness and provided insufficient reasons for refusing the stay.

The Divisional Court dismissed the application, finding the appeal panel reasonably concluded that the stay request should be addressed by a new hearing panel with the benefit of a full evidentiary record.

The defendants brought a motion to strike the plaintiff's claims based on the 1624 Statute of Monopolies and the 1897 Ontario Monopolies Act.

The plaintiff, a generic pharmaceutical manufacturer, alleged that the defendants unlawfully delayed its entry into the market by obtaining and asserting an invalid patent.

The defendants argued that the Patent Act and NOC Regulations constituted a complete code and that the Monopolies Acts did not apply.

The court dismissed the motion, finding that it was not plain and obvious that the claims could not succeed, as the law regarding the complete code argument was unsettled and the Monopolies Acts could arguably apply to invalid patents.