Trung Nguyen

This is a costs ruling following a complex fourteen-day combined family and civil trial.

The trial involved equalization payment disputes between spouses exceeding $10.5 million, unequal division claims, post-valuation date adjustments, fraud and oppression allegations, and a civil action for fraudulent conveyancing.

The husband was ordered to pay the wife an equalization payment of $1,054,267 and the wife was ordered to pay the husband $1,000,000 for oppression and punitive damages.

The court addressed costs claims from the wife and a third-party defendant, finding the civil action unnecessary and awarding limited costs to the wife for a specific pre-trial motion, while awarding substantial costs to the third-party defendant who successfully defended against fraud allegations.

The court considered whether Blaney McMurtry LLP, former counsel for the defendants, was entitled to a declaration or an equitable mortgage over the defendant’s property for unpaid legal fees, based on a prior consent order.

The court found that the consent order did not create an equitable mortgage in favour of Blaney, as the intention was for a bank to be the secured creditor, not Blaney.

The motion was dismissed.

The plaintiff, Datamy Inc., brought a motion for summary judgment against the defendants, Ka-Hang Yung and Vivien Yung, for breach of an Agreement of Purchase and Sale (APS) relating to a residential property.

The defendants failed to pay a second deposit of $140,000 as required by the APS.

The court held that the plaintiff was entitled to summary judgment for the unpaid deposit, rejecting the defendants’ arguments for relief from forfeiture and finding the deposit amount reasonable.

Alternatively, the court calculated damages based on the difference in sale price and related costs, but ultimately awarded the full unpaid deposit.

This is a ruling on a motion to disqualify a witness, Gabrielle St. George, in ongoing matrimonial and civil litigation.

Vito Ierullo sought to call Ms. St. George, the estranged sister of Rae Marie Ierullo (referred to as Ms. Adragone), to provide evidence concerning a loan assignment, the transfer of a family home, and allegations of forgery and fraudulent documents.

Rae Marie Ierullo objected, arguing the proposed evidence was largely hearsay, lacked direct knowledge, and was motivated by ill-will.

The court found the evidence to be speculative, based on animus, and largely hearsay, concluding that its admission would unnecessarily expand the scope of the trial into collateral family and estate issues.

The motion to permit Ms. St. George to testify was dismissed.

The appellant, a not-for-profit corporation, appealed an application judge's order setting terms for its upcoming annual general meeting and board elections following a disrupted meeting and internal governance dispute.

The appellant argued the terms regarding membership eligibility and election procedures were inconsistent with its by-laws.

The Divisional Court dismissed the appeal, finding the application judge had broad discretion under the Not-for-Profit Corporations Act to impose terms for fair elections and made no palpable and overriding error in her factual findings regarding membership.

This mid-trial ruling addresses the qualification of an expert witness, D.J. Myles Martin, proposed by the applicant (Rae Marie Ierullo) in a combined family and civil trial concerning business valuations.

The respondent (Vito Ierullo) challenged the expert's qualifications.

The court applied the Mohan and White Burgess tests for expert admissibility, considering factors such as formal education, professional qualifications, experience, and independence.

The court declined to qualify the expert, citing his lack of formal CBV accreditation, limited litigation support experience, and an undisclosed social relationship with the applicant, which raised concerns about his objectivity and non-partisanship.

In a complex, combined family and civil proceeding, the husband brought motions to further amend his pleadings and compel third-party financial disclosure shortly before a rescheduled trial.

The court dismissed the majority of the requested amendments, finding them to be an attempt to retool his narrative and expand the issues on the eve of trial.

The court ordered the third parties to file an affidavit regarding the availability of the requested records but relieved them from the balance of the summons.

Finally, the court ordered the wife to pay $40,000 in costs thrown away for a previously adjourned trial date.

The moving party, a not-for-profit corporation, sought an urgent stay of an application judge's order prescribing the process for determining membership and voting rights for an upcoming annual general meeting, pending an appeal.

The Divisional Court applied the three-part test for a stay pending appeal.

Finding that the appeal raised a serious issue, that there was potential for irreparable harm due to the history of disruption at previous meetings, and that the balance of convenience favoured a stay given the expedited appeal date, the court granted the stay.

The applicant, a not-for-profit corporation, brought an application seeking a declaration that a vote held by the respondents to appoint themselves as an interim board was invalid.

The respondents had purported to hold the vote after the applicant's board of directors adjourned the annual general meeting due to disruptions.

The court found the vote was invalid and a nullity, as it was held without authority and contrary to the corporation's by-laws.

The court affirmed the incumbent board's authority and ordered a new annual general meeting to be held within 60 days, providing specific directions on membership eligibility and meeting conduct.

The plaintiffs in two related actions sought an interim Mareva injunction against the defendants, alleging a fraudulent investment scheme involving the purchase and resale of used vehicles.

The court found a strong prima facie case of fraud, noting evidence of non-existent purchasers, missing funds, and the transfer of assets by the personal defendant.

The court granted the Mareva injunction in the standard form, rejecting the defendants' request for an adjournment and their proposed terms allowing discretionary withdrawals for living expenses and business operations.

The plaintiffs appealed a Master's order releasing over $450,000 held in trust as security to the defendants.

The funds were deposited pursuant to an undertaking in exchange for the discharge of a construction lien.

The Master had ordered the release of the funds because the plaintiffs failed to set the action down for trial within two years, reasoning that the funds were akin to security paid into court to vacate a lien under the Construction Lien Act.

The Divisional Court allowed the appeal, finding that the Master erred in conflating the discharge of a lien with vacating a lien, and that the undertaking clearly intended the funds to be held pending final resolution of the dispute.

The appellant sought to set aside four property transfers made by the respondent to his wife and her company under the Fraudulent Conveyances Act.

The trial judge found the 1987 and 1988 transfers were not fraudulent, but set aside the 1992 and 1993 transfers of the matrimonial home and a Florida property.

Both parties appealed the trial judge's findings of fact.

The Court of Appeal dismissed the appeal and cross-appeal, finding no palpable and overriding error in the trial judge's assessment of the evidence, his refusal to pierce the corporate veil, or his rejection of the laches defence.

Motions to admit fresh evidence were also dismissed.

The plaintiff creditor sought to set aside several property transfers made by the debtor to his spouse and to a corporation owned by the spouse, alleging they were fraudulent conveyances under the Fraudulent Conveyances Act.

The court analyzed transfers occurring in 1987, 1988, 1992, and 1993, applying the statutory test and the common-law “badges of fraud.” It held that earlier transfers of commercial and farm properties in 1987–1988 were not fraudulent because the plaintiff was not yet a creditor and there was insufficient evidence that the debtor reasonably anticipated insolvency at the time.

However, transfers of the debtor’s interest in the matrimonial home in 1992 and a Florida condominium in 1993 occurred when the debtor faced serious financial exposure and litigation, and were made with intent to defeat creditors.

Those later transfers were set aside.

Although the plaintiff delayed extensively in pursuing the action, the defence of laches failed because the defendants did not prove specific prejudice from the delay.

The appellant appealed a decision declaring that the respondent's debt would be released by his discharge from bankruptcy.

The respondent had acted as a 'straw borrower' and co-signed a mortgage application, unaware that the primary borrower had made fraudulent misrepresentations.

The appellant argued the debt should survive bankruptcy under s. 178(1)(e) of the Bankruptcy and Insolvency Act due to false pretences.

The Court of Appeal dismissed the appeal, holding that s. 178(1)(e) requires a causal connection between the bankrupt's false pretences or fraudulent misrepresentation and the obtaining of the property.

The trial judge correctly found the mortgage funds were advanced based on the primary borrower's misrepresentations, not the respondent's.

The appellants appealed a motion judge's decision regarding amendments to their Statement of Defence, the issuance of a Third Party claim, and the discharge of Certificates of Pending Litigation (CPLs).

The Court of Appeal upheld the motion judge's rulings on the pleadings and third party claim, agreeing that the proposed limitation defence had already been rejected by the court in a prior proceeding.

However, the Court found the motion judge erred in concluding he lacked jurisdiction to consider discharging the CPLs on the ground of non-disclosure due to res judicata.

The Court held that the issue had not been squarely dealt with and permitted the appellants to bring the motion before the case management judge.

The appeal was otherwise dismissed.

The defendants brought a motion to set aside an ex parte Mareva injunction restraining them from dealing with their assets in connection with allegations of fraud and unjust enrichment.

The plaintiff alleged that the defendant fraudulently induced the transfer of $750,000 USD to a numbered company controlled by his common-law partner and that the funds were used for personal expenses and property renovations.

The court found a strong prima facie case of fraud against the individual defendant and unjust enrichment against the other defendant, and held there was a real risk of asset dissipation.

The court rejected arguments that the plaintiff failed to make full and frank disclosure on the ex parte motion and declined to require the plaintiff to post security for its undertaking in damages.

The Mareva injunction was continued and the defendants’ motions were dismissed.

Following a successful appeal, the appellant sought costs for the appeal, a motion to set aside an order, and the underlying motion before the lower court.

The respondents did not oppose the costs of the appeal.

The Court of Appeal awarded the appellant costs for all three matters, totaling $49,278.09.

The appellant appealed the dismissal of its action brought pursuant to s. 38(1) of the Bankruptcy and Insolvency Act to set aside alleged fraudulent conveyances.

The motion judge had dismissed the action as an abuse of process and barred by res judicata due to the bankrupt's discharge and the dismissal of a prior action.

The Court of Appeal allowed the appeal, holding that under s. 38(1), the appellant was advancing the Trustee's claim, not its own personal claim, meaning the action was not a collateral attack on the discharge order or barred by res judicata.

The Court also dismissed the respondents' motion to review a decision refusing to order security for costs against the appellant's counsel, who was acting on a contingency fee basis.

The plaintiffs sued a contractor and its principal for breach of a contract to construct a turn-key restaurant in a leased strip-mall space.

The court found the defendants agreed to complete the project by a specified deadline, failed to meet that deadline and two later written guarantees, and were responsible for multiple construction and equipment deficiencies, including electrical work, ventilation, fixtures, seating, and sprinkler upgrades.

The court rejected the claim for lost business profits as unsupported, but enforced a weekly liquidated damages clause and awarded thrown-away operating expenses for the pre-addendum delay period.

On the counterclaim, the defendants were permitted only to set off the contractual $10,000 holdback; all alleged extras were dismissed.

Judgment issued for the plaintiffs for $46,199.10 plus pre-judgment interest.

The respondents brought a motion seeking an order requiring the appellant's law firm, which was acting on a contingency fee basis, to post security for costs of the action and the appeal.

The appellant corporation and its principal were previously found to be impecunious.

The Court of Appeal dismissed the motion, holding that requiring lawyers on a contingency fee arrangement to post security for costs would impose a significant disincentive to such arrangements and run contrary to the rationale of promoting access to justice.