In Krieser v. Seligman, 2024 ONCA 827, the case revolved around the construction of a luxury home in Forest Hill, Toronto, and a subsequent legal battle involving allegations of contract breaches, construction deficiencies, and claims of fiduciary duty. In 2004, the plaintiffs contracted the defendant to build their home. While construction progressed, disputes emerged, leading the plaintiffs to withhold payments. Litigation ensued in 2007, with both parties asserting significant claims: the plaintiffs sought damages for alleged deficiencies, while defendant pursued payment for outstanding invoices. The case culminated in a trial in 2022-2023, where the trial court largely ruled against the plaintiffs. The appeal focused on two primary issues: the alleged breach of contract and a claim for breach of fiduciary duty. The plaintiffs argued that the trial judge erred in finding their delayed payments constituted a breach that disentitled them from warranty claims. Additionally, they contended the judge failed to … Read More
Essential Terms of a Contract: Ontario Superior Court of Justice Confirms Agreements Must Be Complete and Concise
In Qureshi v. Zeema Investments Incorporated, 2024 ONSC 5855, the Ontario Superior Court of Justice emphasized the importance of ensuring that the essential terms of contractual agreement are comprehensive and clear. This summary judgment arose from an unpaid commission payment on a real estate transaction. A broker was mediating a purchase and sale of a hotel between a buyer and seller. the broker and buyer had executed a Buyer’s Representation Agreement (the “BRA”) listing the commission owing to the broker by the buyer on closing at “TBD,” and was to be confirmed upon executing an agreement. The BRA required a commission to be paid to the broker in the event of buyer default on any agreement of purchase and sale that is entered. The broker subsequently entered a Commission Agreement with the seller, which included a commission payment of $650,000 that was owed by the seller to the broker on … Read More
Promises vs. Paperwork: Ontario Court Clarifies Limits of Proprietary Estoppel in Share Disputes in Burwell et al v. Wozniak, 2024 ONSC 5851
In the recent Ontario Superior Court of Justice decision Burwell et al v Wozniak, 2024 ONSC 5851, the Court examined complex trust and proprietary estoppel issues between former partners. The decision in Burwell clarifies the boundaries of proprietary estoppel within Ontario law and emphasizes the importance of consistency between preliminary promises and formal agreements in trust disputes. The applicant and respondent were involved in a former relationship, during which time the applicant and their business partner launched a subscriber-based billing management software company (the “Company”). The applicant sought to establish a family trust; however, the pair separated. Wishing to reconcile the relationship, the applicant sent the respondent an email purporting to bequeath her fifty (50) percent of the shares of the Company (the “Email”). Later the pair finalized a trust agreement appointing the applicant and respondent as beneficiaries. However, the trust agreement did not clearly define the ownership of the … Read More
Promissory Estoppel, Part Performance, and Limitation Periods: Ontario Superior Court Refuses to Enforce Mortgage Beyond 10-Year Limit
In Albrecht v 1300880 Ontario Inc., 2024 ONSC 3328, the Ontario Superior Court of Justice examined key legal principles surrounding the extension of limitation periods through promissory estoppel and part performance. The case involved a mortgage that had been in default for over a decade, with the mortgagee seeking enforcement beyond the statutory limitation period (the “Mortgage”). The applicant sought to have the Mortgage discharged, arguing that enforcement was barred under Ontario’s Real Property Limitations Act (“RPLA”) ten-year cutoff. The respondent countered by asserting that an oral agreement between the parties extended the limitation period, relying on promissory estoppel and part performance to justify enforcement despite the expired limitation period. Citing the doctrine of promissory estoppel, which prevents a party from reneging on a promise without formal consideration, the respondent claimed there was an oral agreement to delay the enforcement of the Mortgage until the applicant’s financial condition improved, thereby … Read More
Notice, a Condition Precedent to Coverage – Ontario Court of Appeal says no Relief of Forfeiture for Late Notice of Claim
In the recent case of Furtado v Underwriters, 2024 ONCA 579, the Ontario Court of Appeal reviewed an appeal from an insured party challenging an application judge’s decision denying coverage under a Directors and Officers policy (the “Policy”). The Court upheld the application judge’s ruling, determining that the insured had reported its loss beyond the specified notice period outlined in the contract, as well as affirming the recent legal precedents concerning the doctrine of relief from forfeiture in the insurance context. While the Policy was in effect, the Ontario Securities Commission (“OSC“) initiated inquiries into the business dealings of Go-To, a company in which the insured held a directorial position. Following this, the OSC issued an Order for the insured to produce certain documents related to the investigation into Go-To. As part of the process, the insured was cautioned by the OSC that section 16(1) of the Securities Act prohibited … Read More
Full and Frank Disclosure, Material Misrepresentations, and the availability of Directors’ and Officers’ Liability Coverage
The Ontario Court of Appeal’s (the “Court“) recent decision in Davies v AIG Insurance Company of Canada, 2024 ONCA 509 (“Davies“), deals with an insurance coverage dispute related to the defense of a Ponzi scheme fraud claim. Notably, the Court’s decisions underscores the significance of full and frank disclosure by insureds when applying for coverage. In Davies, the subject Applicants acted as the principals of related Ontario real estate development companies (the “Companies”). AIG Insurance Company of Canada (“AIG”) issued directors’ and officers’ liability insurance policies (the “Policies”) to the Companies. As part of this action, the Applicants were named as defendants in two separate lawsuits alleging that they used the Companies to conduct a Ponzi scheme and that the Companies’ alleged real estate developments were funded by millions of dollars in syndicated mortgages (the “Underlying Actions”). Soon after being named as defendants in the Underlying Actions, the Applicants sought … Read More
Jurisdiction and forum non conveniens in the Digital Age – Ontario Court Refuses to Certify Class Action against the United States Largest Cryptocurrency Exchange due to Lack of Jurisdiction
In Shirodkar v Coinbase Global Inc. et al, 2024 ONSC 1399, the Ontario Superior Court of Justice provides a review of jurisdictional challenges and the issue of forum non conveniens involving a cryptocurrency class action. The defendants, Coinbase Global, Inc., along with its affiliated entities (“Coinbase”), faced a class action lawsuit brought by a user of its online trading platform, Mr. Shirodkar, which Coinbase sought to dismiss due to a lack of jurisdiction. Coinbase operates a platform for buying and selling digital assets, including cryptocurrency. Between October 2017 and January 2021, Mr. Shirodkar conducted transactions on the Coinbase platform while residing in France and later in Ontario. His complaint, in the form of a class proceeding, alleged that the crypto assets traded on the Coinbase platform should be classified as “securities” under the Securities Act, R.S.O. 1990, c. S. 5 and that Coinbase failed to abide by the disclosure requirements … Read More
Licensing Breaches and Lingering Fiduciary Obligations – Ontario Court of Appeal Rules License Agreement Breach Constitutes Fiduciary Duty Violation
In 7868073 Canada Ltd v 1841978 Ontario Inc, 2024 ONCA 371, the Ontario Court of Appeal recently assessed the legal effects of engaging in competing business ventures and the importance of honoring fiduciary duties stemming from license agreements following a parties departure from a former corporation. Robert Langlois (“Langlois”), alongside two partners, launched a powder-coating business, whereby Langlois granted a perpetual license (the “License”) for his industry “knowledge” to 7868073 Ontario Inc. (“786”), a company which the three parties formed and held equal shares in. In turn, 786 owned shares in two other companies (collectively referred to as “ACS”), which Langlois worked with. When Langlois left ACS to start another business without informing his former partners, ACS alleged that Langlois breached the License. The Court of Appeal affirmed the trial judge’s findings, rejecting the argument that the License was void ab initio due to its unreasonable worldwide scope and restrictions … Read More
A Promise Made is a Promise Kept: Ontario Superior Court Grants Permanent Injunction to Enforce Provisions of Long-term Supply and Lease Agreement
In Parkland Corporation v. Caledon Fuels Inc., 2024 ONSC 2361, the Ontario Superior Court of Justice granted an injunction which prevented a party to a long-term lease and supply agreement from breaching certain negative covenants contained in that contract. The Applicant and Respondent were both parties to an agreement under which the Applicant was made the exclusive supplier of petroleum products to a gas station which it subleased to the Respondent. In January of 2024, the Respondent notified the Applicant that it intended to enter into arrangements with another supplier, in contravention of the agreement. The Applicant brought an urgent application seeking a permanent injunction, to prevent the Respondent from doing so. In its decision, the Court’s analysis on the injunctive relief sought by the Applicant followed the Ontario Court of Appeal’s decision in 711811 Ontario Ltd. (AdLine) v. Buckley Insurance Brokers Ltd., 2014 ONCA 125, where that Court cited … Read More
7 Things to Know About Recognition and Enforcement of Foreign Judgments in Ontario
In the recent decision of the Ontario Superior Court of Justice (“ONSC”), Roger Vanden Berghe NV v. Merinos Carpet Inc., 2023 ONSC 6728, the ONSC provided a helpful guide on some of the key principles applicable to cases involving the recognition and enforcement in Ontario of judgments from other countries. In this case the ONSC granted an application for the recognition and enforcement of a judgment from a court in Belgium; the Ghent Business Court, Kortrijk Division, First Chamber (the “Judgment”). The underlying dispute that was adjudicated in Belgium was with respect to unpaid invoices for textile orders. The respondent did not respond to the proceeding in Belgium, although summoned by a Writ of Summons. The respondent claimed that it was not properly served with the Writ of Summons, and even if it was, one of its representatives would not have been able to attend given the Covid-19 travel restrictions … Read More
Ontario Superior Court of Justice Finds Expired Arbitration Award Relevant in Motion for Injunctive Relief
In Rogers v. TELUS Communications Inc., 2023 ONSC 5398, the Ontario Superior Court of Justice held that the terms of an expired arbitration decision are relevant when a party seeks injunctive relief that contradicts its terms. The moving and responding parties are both prominent competitors in the Canadian telecommunications market. Under a requirement imposed by the Government of Canada, their customers have the reciprocal ability to “roam” on the other carrier’s network in areas where their own carrier does not provide coverage. This obligation allows Canadian customers to access wireless services across the country. For a time, the parties did not agree on what was displayed to customers when they were roaming on a competitor’s network. The primary dispute was whether the network identifier (“NID”) displayed in the top-left corner of most mobile devices would connote an extension of their own carrier’s network (i.e. “[Carrier]-EXT”), or if it would notify customers … Read More
Stay of Court Proceedings in Favour of Arbitration – Standard of Proof
In the recent decision Husky Food Importers & Distributors Ltd. v. JH Whittaker & Sons Limited, 2023 ONCA 260, the Ontario Court of Appeal (“ONCA”) reviewed the law of international commercial arbitration, and in particular opined on the issue of the standard of proof that a party needs to meet in order for the court to grant a stay of a court proceeding pursuant to section 9 of the International Commercial Arbitration Act, 2017 (the “Act”), in favour or arbitration. Section 9 of the Act states as follows: Where, pursuant to article II (3) of the Convention or article 8 of the Model Law, a court refers the parties to arbitration, the proceedings of the court are stayed with respect to the matters to which the arbitration relates. The appellant submitted that the proper analytical framework for assessing a request to stay an action under the Act was set out in the … Read More
Do it, Don’t Just Say it! Court of Appeal refuses to Rule on Arbitration Clause
On a recent motion before the Court of Appeal in Paulpillai Estate v. Yusuf, 2020 ONCA 655 (CanLII), Jamal J.A. clarifies that a party needs to bring a motion if it wants the proceeding to be referred to arbitration. In the underlying decision, Paulpillai v. Yusuf, 2020 ONSC 851 (CanLII), the motion judge noted that the responding parties “have maintained in their affidavit evidence that the matter should have proceeded by way of arbitration, but at no time did they bring a motion seeking to stay these proceedings or to compel the Applicants to proceed by way of arbitration”. Accordingly, the motion judge found that the responding parties have waived their right to seek to have the issues in the action determined by way of arbitration. In agreement with the motion judge, Jamal J.A., writing for the Court of Appeal, clarifies that, even though (a) there was an arbitration clause … Read More
Corporate Governance Considerations During the Covid-19 Pandemic
Corporate governance issues are top of mind for directors and businesses who are attempting to navigate through the Covid-19 Pandemic related closures and emergency measures. Boards of Directors still need to operate and make decisions in the best interests of the corporation, and this can involve tough decisions, particularly where there is little guidance as to how measures to lift Covid-19 related restrictions will play out. By example, while it may be in the best interest of investors and shareholders that the Board act to lay off employees in the short term, the impact of staff shortages when Covid-19 restrictions are lifted may pose it’s own challenges. Many businesses must consider how to hold governance meetings during Covid-19 times. On March 30, 2020, Ontario passed an Order under the Emergency Management and Civil Protection Act (EMCPA), (Ontario Regulation 107/20) entitled “Meetings for Corporations” making temporary changes to the Business Corporations … Read More
COVID-19 / Coronavirus: Rent Relief for Small Businesses Is Coming
On April 16, 2020, the Federal government announced the Canada Emergency Commercial Rent Assistance (CECRA) program to assist small businesses with their rent payments during the COVID-19 crisis. The CECRA program will provide loans and/or forgiveable loans to commercial property owners who will be expected to pass on the benefit to small businesses by lowering or forgoing rent for April (retroactively), May and June 2020. Further details of the program are expected to be released soon and the program will be administered by the provincial and territorial governments. Although the Ontario Superior Court of Justice had issued an Order on March 19, 2020 suspending the eviction of residents from their homes (unless ordered otherwise under an urgent motion), there was no similar protection against evictions for commercial tenants which included many small business owners. Commercial rent payments are typically the second largest operating expense for most small businesses after payroll … Read More
COVID-19 / Coronavirus: How to Schedule an Urgent Civil or Commercial List Hearing
On March 15, 2020, the Chief Justice of the Ontario Superior Court of Justice released a Notice to the Profession advising that all scheduled civil hearings were adjourned until further notice. The Notice to the Profession provides a procedure to schedule urgent and time-sensitive motions and applications where immediate and significant financial repercussions may result without a hearing. When motion or application materials are filed, by email to the appropriate courthouse, seeking an urgent hearing, the triage judge will determine whether or not the matter is urgent and should be scheduled for a hearing. There have been a few recent endorsements reported in respect to the scheduling of urgent commercial lease matters. Urgent Motion – Relief From Forfeiture In Oppong v. Desoro Holdings Inc., 2020 ONSC 1697, the applicant sought relief from forfeiture to set aside the landlord’s termination of the lease. Although the application was brought promptly and scheduled to be … Read More
Andrew Ottaway Writes Article on CISG for Law Times
The Law Times recently published an article by Andrew Ottaway on the United Nations Convention on Contracts for the International Sale of Goods (the “CISG”). The article includes: a discussion of the recent case of Solea International BVBA v. Bassett & Walker International Inc., 2018 ONSC 4261 (CanLII), in which the Ontario Court applied the CISG; a discussion of the near total obscurity of the CISG in Ontario; examples of the notable differences between the CISG and the Ontario common law / Sale of Goods Act. The article can be read in its entirety here. The lawyers at Gilbertson Davis LLP have experience in commercial litigation, including cross-border litigation involving the CISG. Contact us for an initial consultation.