Legal Blog:

Costs Indemnity

Michele’s Italian Ristorante Inc. v. 1272259 Ontario Ltd. 2016 Ont SCJ

Landlord brought a motion for possession of leased premises; tenant brought a motion for relief from forfeiture and for an order requiring the landlord to renew the lease. Landlord was successful. Judge granted substantial indemnity costs of $51,000 because a clause in the lease required the tenant to pay “all costs and expenses including legal fees on a substantial indemnity basis incurred by the Landlord in enforcing the lease.”

Fraudulent Conveyance / Preference

Bearsfield Developments Inc. v. McNabb 2016 Ont SCJ

Employee embezzled funds between 2006 and 2011 and then retired. In 2012, she paid $207,000 to an insurer for an annuity. An annuity, or a registered plan with an insurance component, cannot be seized and sold by a creditor. One month later, the employer discovered the embezzlement. The employee was ultimately convicted and the employer obtained a default judgment of approximately $1 million. Their employer moved under the Fraudulent Conveyances Act to set aside the transfer of the money into the annuity. Even though the employer was not a creditor at the time of the transfer, the court held that the employee had an intent to defeat the employer by way of the transfer of seizable money into a non-seizable asset. The court set aside the transfer.

SNF Excited to be Represented on the Board of Directors of MBOT

Susanne Balpataky, a partner with SNF, was one of three new directors elected to the Board of Directors of the Mississauga Board of Trade at its Annual General Meeting held on December 13, 2016. Susanne also sits on the Policy and Government Affairs Committee of MBOT. Susanne is thrilled to be given the opportunity to work with the other dedicated members of the Board in representing the business community and to promote and further business in Mississauga.

Click here for more information.

Jurisdiction – Small Claims Court

Edward Goldentuler Professional Corp v. Sorger 2016 Ont Div Ct

Lawyer obtained default judgment for fees. Client moved to set aside the judgment years later and the motions judge did so after deciding that the original claim was contrary to the Limitations Act and was outside the jurisdiction of the Small Claims Court. The Divisional Court set aside the order of the motions judge and reinstated the judgment. The motions judge was, in effect, dealing with the original judgment as if there were an appeal of that judgment and did not have jurisdiction to do this. The motions judge could have set aside the order if satisfied that the defendant had a meritorious defence and a reasonable explanation for the default and the motion was made as soon as possible in all circumstances. However, the defendant provided no evidence to meet the 2^nd and 3^rd criteria.

Ontario Electrical Contractor Publication

Susanne’s article entitled “Stirring the Pot” was published in the Ontario Electrical Contractor magazine, Vol 52, Number 4, Fall 2016 edition. Click here to view, starting at page 24. 

Owner

Lepera Contracting Inc. v. Royal Timbers Inc. 2016 Ont Div Ct

Contractor did work on 2 phases of the same project pursuant to a successful response to a request for tenders. The contractor entered into 2 contracts: one for phase 1 and one for phase 2 of the project. The contract for phase 1 was with Newco, a stand-alone corporation that was to take title to phase 1 and develop the property as a hotel. The contract for phase 2 was with the titled owner of both phases 1 and 2. The owner of the project had entered into a contract to sell phase 1 to a hotelier, which had incorporated Newco to take title and develop the property. The agreement to sell fell through and Newco, which had no assets, defaulted on a payment of $385,000 to the contractor who had performed site servicing work. The contractor liened and sued the titled owner to enforce the construction lien and for unjust enrichment. The lien action was dismissed because the court held that the titled owner was not an “owner” for purposes of the Construction Lien Act. The contractor knew that it was dealing with Newco, a non-owner, on phase 1 and with the titled owner on phase 2. The court also held that there was no unjust enrichment because there was a juridical reason for the enrichment, the contract for phase 1.

Arbitration

Haas v. Gunasekaram 2016 Ont CA

A disappointed investor commenced an action against other shareholders of a corporation for fraudulent misrepresentation and oppression. The shareholders moved to stay the action because the shareholders’ agreement called for arbitration of all disputes regarding the agreement. The Court held that merely because there was a tort claim, in addition to an oppression claim, did not mean that an arbitrator did not have jurisdiction to determine whether the arbitrator had jurisdiction. The Court of Appeal stayed the action.

Trial, Set Down

K.H. Customs Homes Ltd v. Smiley 2015 Ont Div Ct

A general contractor registered a claim for lien against owner’s property and commenced an action to enforce the lien and for payment on contract. The general failed to set the action down for trial within 2 years of commencement of the action contrary to section 37 of the Construction Lien Act. Section 46(1) of the CLA mandates that, under those circumstances, a court, upon motion, must declare that a lien has expired and make an order dismissing the action to enforce the lien and vacate the registration of the claim for lien. Section 46(2) provides that the motion can be brought without notice, but no order of costs will be given in those circumstances. The owner brought the motion without notice and the motions judge dismissed the entire action. The owner appealed. It was willing to see its lien action dismissed, but not the contract portion of the action. The Divisional Court held that, if the contractual portion of the action is to be dismissed, the motion must be on notice.