2 total
Motion for stay of buyout order pending appeal dismissed; balance of convenience favoured respondents.
The moving parties (appellants) sought a stay of several endorsements pending their appeal of an order directing a buyout of their shares in a condominium development project.
The underlying dispute involved mutual allegations of oppression between two 50% shareholders.
The court applied the RJR-MacDonald test for a stay pending appeal.
It found no serious issue to be tried, noting the broad discretion of the motion judge under the OBCA.
While acknowledging that loss of mortgage security could constitute irreparable harm, the court concluded that the balance of convenience strongly favoured the respondents, who risked losing $25 million in financing and the entire buyout transaction if the stay were granted.
The motion for a stay was dismissed.
The court ordered a section 207 buyout at a midpoint valuation to resolve a deadlocked condominium joint venture.
Two equal 50% shareholders in a lakeside condominium development project in Burlington, Ontario (Nautique Lakefront Residences) sought court guidance on separating their partnership following an acrimonious impasse.
The applicant, an investor providing approximately 90% of equity funding, proposed a court-imposed shotgun buy-sell mechanism.
The respondent proposed a buyout under section 207 of the Business Corporations Act using a valuation report prepared by KSV Soriano Inc. The court found that both parties had engaged in oppressive conduct but determined that separation was necessary to preserve the project.
The court ordered a section 207 buyout by the respondent at a price representing the midpoint between two valuation scenarios, rejecting the shotgun mechanism due to procedural fairness concerns arising from late notice and the respondent's good faith participation in case management conferences.
