Films S.A. v. Cinemavault Releasing International Inc. 2016 Ont Div Ct
Corporate group reorganised. The reorganisation resulted in corporation #1 having no assets. The plaintiffs, who were creditors of corporation #1, commenced an action that, among other things, alleged oppression on behalf of the other corporations and the guiding individuals. The trial judge found that the assets were transferred for no consideration and that there was no bona fide business purpose for the restructuring. The application judge held all of the defendants liable for the creditor’s debt. The Divisional Court agreed, noting that the direct personal benefit that the controlling shareholder received also constituted oppressive activity on his behalf that attracted personal liability.
Written by Jonathan Speigel Jonathan Speigel, the founding partner of Speigel Nichols Fox LLP, leads the litigation and construction practices.