In 1515474 Ontario Inc. v. Soocellus Ontario Inc., 2020 ONSC 270, Ontario’s Divisional Court upheld an order granting a shareholder control of the conduct of ongoing dispute resolution. Post-sale of G’s shares in F Co., G retained non-voting shares in F Co. with a right to receive net proceeds in F Co.’s litigation so long as G provided litigation funding and met other financial terms. F Co.’s eventual decisions to reduce activity in the litigation, to seek an end to it and to mediate so as to “accept the best reasonable offer we are able to negotiate” combined to qualify as oppression justifying the grant of litigation control. The order sought to rectify for breach of G’s reasonable expectations created by the sale of G’s shares in a company engaged in litigation but, unlike other oppression remedies, limited the grant of control to the conduct of litigation and not overall operations of F Co.
Continue reading “Ontario – oppression remedy grants party control of dispute resolution covered by funding agreement – #336”Ontario – securities commission exempts filer from filing even redacted copies of litigation funding agreements – #335
In Stans Energy Corp. (Re), 2019 CanLII 36437 (ON SEC), the Ontario Securities Commission granted an exemption to a filer from filing two (2) litigation funding agreements despite the documents qualifying as material contracts under Ontario’s 51-102 – Continuous Disclosure Obligations. To issue the exemption, the Securities Commission relied on (i) prior disclosure of key information, (ii) privilege and confidentiality issues which would be violated if further disclosure was made as well as (iii) not compromising the filer’s relationship with the funders.
Continue reading “Ontario – securities commission exempts filer from filing even redacted copies of litigation funding agreements – #335”Ontario – settlement rescinded based on innocent misrepresentation of material fact unknown to Defendant – #332
In Deschenes v. Lalonde, 2020 ONCA 304, Ontario’s Court of Appeal upheld rescission of a settlement on the basis of Defendant’s innocent misrepresentation regarding a fact material to Plaintiff’s decision to settle. Defendant’s actual or constructive knowledge that the representation was false was unnecessary. The Court distinguished rescission based on innocent misrepresentation from rescission based on unilateral mistake. Despite the strong presumption favouring finality of settlements, the Court reiterated that the ways to “upset” a settlement are the same as those applicable to other contracts, including fraud, misrepresentation, duress, undue influence, unconscionability, or mutual or unilateral mistake.
Continue reading “Ontario – settlement rescinded based on innocent misrepresentation of material fact unknown to Defendant – #332”Ontario – parties’ signature of arbitrator’s terms does not overwrite appeal process in original agreement – #331
In 547131 Ontario Limited v. MPI Torgan, 2020 ONSC 3186, Madam Justice Carole J. Brown disagreed that terms submitted by the arbitrator and signed by the parties overwrote the parties’ initial agreement in their main contract regarding appeals of any arbitral award. The arbitrator’s terms covered conflicts, compensation, the services of an arbitral secretary, cancellation policy, confidentiality, immunity and administration issues. Brown J. identified no indicia that the arbitrator’s terms altered the initial agreement that the award would be “final and binding” and not subject to appeal, even on a question of law with leave of the court.
Continue reading “Ontario – parties’ signature of arbitrator’s terms does not overwrite appeal process in original agreement – #331”Ontario – consent order prompts agreement to arbitrate to complete it and fresh litigation over vague term – #326
In Lokhandwala v. Khan et. al., 2020 ONSC 3209, Mr. Justice William M. LeMay determined that an offer received for a property qualified as “reasonable” according to a consent order agreed to by the parties in an earlier hearing. That consent order also included an agreement to arbitrate, if need be, the choice of real estate agent to list the property. LeMay J.’s reasons illustrate the care needed by parties to disputes when drafting terms to resolve their disputes so that today’s resolution does not inadvertently sow seeds for future, new disputes. The reasons also include helpful references to case law on judicial notice and the pandemic.
Continue reading “Ontario – consent order prompts agreement to arbitrate to complete it and fresh litigation over vague term – #326”Ontario – applicant seeking court appointment of arbitrator ordered to pay security for costs – #323
In Rayman Tiger Inc. v. Unger Tiger Inc., 2020 ONSC 691, Master Michael P. McGraw ordered that an arbitral party, applying for the appointment of an arbitrator, file security for costs related to its application. Having insufficient assets in Ontario or any reciprocating jurisdiction, the party had to post security in order to engage the court’s assistance for its arbitration. In ordering $15,000.00 rather than the $37,714.01 sought by respondents, Master McGraw distinguished the complexity of issues and facts of the eventual arbitration from those raised by the narrower application to appoint an arbitrator.
Continue reading “Ontario – applicant seeking court appointment of arbitrator ordered to pay security for costs – #323”Ontario – adequate reasons serve to justify/explain result so losing party knows why it lost – #320
In Wawanesa Mutual Insurance Company v. Renwick, 2020 ONSC 2226, Ontario’s Divisional Court determined that inadequate reasons fell short of their “very important purpose”, namely that “they justify and explain the result so that the losing party knows why they have lost and interested members of the public can satisfy themselves that justice has been done”. The Court prioritized that purpose, listing it ahead of the more oft-cited purpose of allowing for meaningful review by a court. Though not all parties prevail in their dispute resolution, they are entitled to know that their evidence and arguments were considered and why they did not prevail. As the Divisional Court added, “[h]owever, this does not mean that the decision maker must refer to every bit of evidence or argument before him. To be adequate, reasons do not have to be long or perfect”.
Continue reading “Ontario – adequate reasons serve to justify/explain result so losing party knows why it lost – #320”Ontario – lawyer’s duty of candour not limited to appearances in court, extends also to arbitration – #314
To address a scheduling issue in court, Mr. Justice Marvin Kurz in Haaksma v. Taylor, 2020 ONSC 2656 relied on rules of professional conduct which expressly stipulate that a lawyer’s duty of candour in ex parte proceedings applies not just to courts but also to arbitrators, mediators and others who resolve disputes, regardless of their function or the informality of their procedures. Kurz J. emphasized that an exchange can qualify as ex parte even if the other party is aware of the exchange but, due to circumstances, cannot adequately respond or make submissions due, for example, to insufficient notice. The duty of candour requires lawyers to take particular care to be accurate, candid and comprehensive in presenting a client’s case so as to ensure that the decision-maker is not misled.
Continue reading “Ontario – lawyer’s duty of candour not limited to appearances in court, extends also to arbitration – #314”Ontario – agreement to either litigate or arbitrate in another country justifies stay – #312
In Best Theratronics Ltd. v. The ICICI Bank of Canada, 2020 ONSC 2246, Mr. Justice Robert Riopelle stayed litigation in favour of the parties’ agreement to litigate or arbitrate in South Korea but refrained from determining the role or mandatory nature of the agreement to arbitrate. Riopelle J. determined only that the courts of Ontario had no jurisdiction and omitted commenting on the primacy of litigation or arbitration in the parties’ agreement. By his omission, he deferred those issues for the parties to argue, if need be, at a later date before the courts in South Korea.
Continue reading “Ontario – agreement to either litigate or arbitrate in another country justifies stay – #312”Ontario – fundamental differences between party-appointed arbitrator and court-appointed referee – #311
Despite their “superficial similarities”, Mr. Justice Ian F. Leach in Belanger v. Harwood et al., 2020 ONSC 1883 identified fundamental differences between an arbitrator and a referee. An arbitrator, appointed by parties, engages in “an autonomous, self-contained and self-sufficient process, presumptively immune from judicial intervention … operating outside the court system” whereas a referee, appointed by the court, works “within the court system, and presumptively subject to the court’s supervision, control and substantive disagreement”. Leach J. also determined that the parties had clearly subjected any third party decision making to a condition precedent which had not yet been realized and the undertaking to engage in that process was “neither binding nor enforceable”.
Continue reading “Ontario – fundamental differences between party-appointed arbitrator and court-appointed referee – #311”