Tatsiana Okun

The respondent, a former CEO and director of the appellant corporation, was removed from his position by shareholders.

He filed a claim for enhanced severance, a bonus, and a share appreciation rights (SAR) cancellation award under his management services agreement.

The trial judge found that the respondent breached his fiduciary duties by establishing the bonus and SAR cancellation awards for his own benefit, but still awarded him the enhanced severance, finding the breach did not constitute a default under the agreement.

The Court of Appeal allowed the corporation's appeal, holding that the trial judge's interpretation of the agreement ignored s. 134(3) of the Business Corporations Act and led to a commercially absurd result.

The respondent's breach of fiduciary duty constituted a default disentitling him to the enhanced severance.

Following a finding that the respondent engaged in conduct contrary to the public interest by purchasing shares while in possession of undisclosed material facts, the Ontario Securities Commission held a sanctions and costs hearing.

The Commission declined to impose the 10-year trading bans sought by Staff, finding them excessive given that no technical breach of the Securities Act occurred.

Instead, the Commission ordered a five-year prohibition on the respondent acting as a director or officer of a reporting issuer, issued a reprimand, and ordered the respondent to pay $150,000 in costs.

Mercer International Inc. applied to the Ontario Securities Commission for a simultaneous hearing with the Québec Bureau de décision et de révision to consider whether AbitibiBowater's take-over bid for Fibrek Inc. should be cease traded.

The Commission acknowledged it had jurisdiction to hear the application, as Fibrek is a reporting issuer in Ontario and the bid affected Ontario shareholders.

However, the Commission declined to exercise its jurisdiction, noting that the Bureau was already seized of the matter, the applicable securities laws were substantially similar, and a simultaneous hearing would not advance the harmonization and co-ordination of securities regulatory regimes.

The application was dismissed.