COURT OF APPEAL FOR ONTARIO

CITATION: XY v. United
    States, 2015 ONCA 773

DATE: 20151112

DOCKET: C59731

Doherty, Pepall and Brown JJ.A.

IN THE MATTER OF an application for judicial review
    pursuant to s. 57 of the Extradition Act, S.C. 1999, c. 18

BETWEEN

XY

Applicant/Person Sought

and

The United States of America

Requesting State

and

The Minister of Justice of Canada and the
    Attorney General of Canada

Respondent

Daniel F. Moore, for the applicant

Nancy Dennison, for the respondent

Heard and released orally: November 5, 2015

On application for judicial review of the surrender order
    of the Minister of Justice, dated December 9, 2014.

ENDORSEMENT

[1]

The applicant seeks judicial review of the
    Minister of Justices decision which reconsidered the original decision of the
    Minister to extradite XY to the U.S.A.

[2]

A reasonableness standard applies to the
    surrender decision of the Minister.

[3]

XY argues that the Ministers decision violates his
    s. 7
Charter
rights and he seeks a stay of
    proceedings on the basis that XY will be subjected to cruel and unusual
    punishment upon extradition.  Alternatively, XY argues that the Ministers
    decision was unreasonable on the basis that he applied an improper legal test,
    misapprehended the evidence and did not consider relevant factors.

[4]

XY seeks an order pursuant to s. 57(6)(b) of the
Extradition Act
quashing the determination of
    the Minister or, in the alternative, an order referring the matter back to the
    Minister and, if surrender is to be ordered, directing the Minister to seek
    guarantees of acceptable placement in custody so that his life and security
    will be protected.

[5]

We do not find the applicants submissions to be
    persuasive for the following reasons.  The test for refusing extradition on s.
    7 grounds was described recently by this court in
France v. Diab
as a strict one and available only in exceptional cases where
    extradition would shock the conscience of Canadians and be simply unacceptable:
France v. Diab
, 2014 ONCA 374, 120 O.R. (3d)
    174, at para. 202, leave to appeal refused,
2014 CanLII 67421 (S.C.C.)
.

[6]

Here, the Minister balanced the risks to the
    applicants personal safety against the protective measures available and came
    to the reasonable conclusion that the extradition of XY would not shock the
    conscience.  In reaching that conclusion, the Minister took into account the
    opinion provided by XYs U.S. counsel, although ultimately he did not accept
    much of that opinion.  As well, the Minister was advised by U.S. authorities
    that XY would be protected and they would be responsive to his safety
    concerns.  The U.S. authorities provided outlines of programmes available to
    any inmate who asserts his or her life is at risk from other inmates.  The
    Minister balanced all that information.  He concluded that those protections
    and representations by the U.S. authorities were sufficient to address the
    particular risks to XYs personal safety and to respond to his concerns.  In
    our view, it was reasonable for the Minister to reach that conclusion based
    upon the information before him.

[7]

The applicant submits that the Minister
    significantly understated the risks to his personal safety.  In his
    reconsideration decision, the Minister reviewed at some length the evidence
    concerning the risks faced by the applicant.   In our view, it was open to the
    Minister to conclude, as he did, on the evidence before him, that the applicant
    did not face a level of risk beyond that faced by the vast majority of
    cooperating inmates.

[8]

Moreover, we reject the applicants submission
    that potential placement by U.S. authorities in special housing units would
    amount to torture and cruel and unusual punishment.  The information provided
    by the U.S. authorities indicated that inmates placed in special housing units
    for protective purposes routinely have a cellmate, work assignments,
    recreational opportunities, educational programming, and may place telephone
    calls and receive social and legal visits.

[9]

For those reasons, we dismiss the application for
    judicial review.

[10]

To ensure that nothing in this endorsement
    interferes with the directions contained in the sealing order of Rouleau J.A.
    dated July 2, 2015, we shall send counsel a copy of this endorsement before
    releasing it.  If counsel have any concerns about the content of the
    endorsement, they should advise the court immediately of them.  The order of
    Rouleau J.A. shall continue in force, subject to any subsequent variation by
    this court.

Doherty J.A.

S.E. Pepall J.A.

David Brown J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Xpert Credit Union Control Solutions Inc. v.
    Witucki, 2015 ONCA 741

DATE: 20151102

DOCKET: C60322

Feldman, Lauwers and Benotto JJ.A.

BETWEEN

Xpert Credit Union Control Solutions Inc.

Respondent (Plaintiff)

and

Matthew Witucki, Erika Joquico and
Anna Borges

Appellant
(Defendants)

Shaneka Taylor, for the
    appellant

Glenn Cohen, for the respondent

Heard: October 30, 2015

On appeal from the judgment of Justice Antonio Skarica of
    the Superior Court of Justice, dated March 18, 2015.

APPEAL BOOK ENDORSEMENT

[1]

The appeal was abandoned and the court was advised yesterday but counsel
    appeared to argue costs.

[2]

Costs of $3,000 to the respondent for the abandoned appeal. Costs of
    $500 to the appellant for the appearance as that issue should have been
    resolved.


COURT OF APPEAL FOR ONTARIO

CITATION: Zachary Timoon Dentistry Professional Corporation
    v. Tonino Ciocca Dentistry Professional Corporation, 2015 ONCA 812

DATE: 20151125

DOCKET: C59901

Epstein, van Rensburg and Hourigan JJ.A.

BETWEEN

Zachary Timoon Dentistry Professional Corporation
    and Dr. Zachary Timoon

Respondents

and

Tonino Ciocca Dentistry Professional Corporation
    and Dr. Tonino Ciocca

Appellants

William H. Fysh for the appellants

Michael Burgar for the respondents

Heard: November 10, 2015

On appeal from the order of Justice J. Robert MacKinnon of
    the Superior Court of Justice, dated December 10, 2014, with reasons reported
    at 2014 ONSC 7171.

van Rensburg J.A.:

Overview

[1]

This appeal concerns the termination of a business relationship between
    two dentists. The relationship was governed by a joint venture agreement, which
    provided for termination on notice, but was silent as to the consequences of
    termination. In these circumstances, did the application judge err in excluding
    the appellant Ciocca from the practice and providing for the sale of his
    interest to the respondent Timoon?

[2]

For the reasons that follow, the answer to that question is no, and I
    would accordingly dismiss the appeal.

Facts

[3]

The individual parties are dentists who began to practise together in
    Newmarket in 2003. In September 2005, they entered into a joint venture general
    dentistry agreement (JVA) through their professional corporations, the
    corporate parties. The JVA provided for termination of the joint venture on 90
    days notice, but did not address the effect of termination, such as providing
    for dissolution or a buy-out by either party of the others interest.

[4]

From 2007 until 2010, the appellant Ciocca pursued training in New York,
    with the intention of establishing himself in a separate location as a
    prosthodontic specialist. In September 2011, he purchased a building and
    developed two separate clinics in Newmarket for his new speciality. The new
    clinics opened in September 2013.

[5]

From the time he began his specialist training, Ciocca continued to work
    one day a week in the parties general dentistry practice, receiving a draw of
    $10,000 per month. The financial statements for the practice allocated net
    income respectively 70%/30% to Timoons and Cioccas professional corporations.

[6]

As the application judge observed, it was the parties understanding
    that their joint venture would terminate, that Ciocca would withdraw from the
    practice, that they would finalize their financial dealings and that the two
    would go their separate ways. Ciocca acknowledged his intention to sell his
    interest to Timoon and leave the practice. However he was reluctant to do so
    until his specialty practice had become sufficiently profitable.

[7]

In March 2014, Timoon gave notice of termination pursuant to the JVA,
    with an effective date of June 30, 2014. Soon thereafter, Timoon sought to
    exclude Ciocca from the practice, but Ciocca resisted. Ultimately, they
    returned to their earlier schedule, with Timoon working three days a week in
    the practice, and Ciocca one day a week.

[8]

While the parties agreed that Ciocca would leave the practice and be
    bought out by Timoon, they disagreed as to whether Ciocca had become overdrawn
    over time, whether an adjustment to Timoons compensation was necessary because
    he had income-split with his spouse, and the impact of any necessary financial
    adjustments on Cioccas buy-out rights. In other words, their dispute was financial.

[9]

On May 28, 2014, Timoon applied to the court under rule 14.05(3)(d) of
    the
Rules of Civil Procedure
for an order terminating the joint
    venture, excluding Ciocca from the business and declaring him sole owner of the
    dental business. Ciocca did not oppose the right to terminate or the effective
    date of the termination. However he opposed Timoons right to assume sole
    ownership of the dental practice. At the time of the application, there had
    been no valuation of the practice. Ciocca asserted before the application judge
    and on appeal that he would sell to Timoon only once his prosthodontic practice
    was sufficiently profitable, and that he should not have to leave the practice
    until all of the parties financial arrangements had been resolved.

Decision of the Application Judge

[10]

The
    application judge declared the joint venture terminated effective June 30,
    2014. He declared Timoon to be the sole owner of the dental practice to the
    exclusion of Ciocca and that Timoon had the sole right to use the business name
    Newmarket Dental Group. He granted other relief, effectively excluding Ciocca
    from any ongoing involvement in the dental practice, prohibiting his
    solicitation and acceptance of current patients from the practice, and
    requiring the parties to cooperate in the transfer to Timoon of the ownership
    interests, assets and liabilities related to the dental practice. The
    application judge directed all outstanding financial disputes to proceed by
    further application or other civil process. Such disputes would include
    calculation of the buy-out value payable by Timoon to Ciocca based on the June
    30, 2014 valuation date, and past accounting adjustments, if any, that would be
    fair or reasonable to deal with the past work inequality concerns raised by
    Timoon and the income-splitting issue raised by Ciocca.

Issues on Appeal

[11]

On
    appeal, Ciocca argues that the application judge exceeded his jurisdiction in
    making the mandatory orders and declarations transferring ownership to Timoon
    and placing restrictions on him. He claims that the application judge had only
    two available options - terminate the joint venture and dissolve or liquidate
    the practice (which was not sought by either party and which Ciocca
    specifically did not seek), or refuse to divest Ciocca of his ownership
    interest until the parties had negotiated an acceptable buy-out.

[12]

Ciocca
    also asserts that, while the application judge had the authority to terminate
    the joint venture, he exceeded his authority under Rule 14 in excluding Ciocca
    as an owner. Ciocca claims that he is entitled to maintain his ownership
    interest, including his right to work in the practice and to share in all of
    the financial attributes of ownership, pending the resolution of the parties
    financial issues and the buy-out of his interest by Timoon. Finally, Ciocca
    takes issue with the application judges order that the parties financial
    issues be determined in other proceedings, and not by trial within the
    application.

[13]

Timoon
    asserts that the application judge effected a practical result that was open to
    him on the record, including Cioccas clear and unequivocal evidence that, for
    years leading up to Timoons notice of termination, he intended to leave the
    practice and be bought out by Timoon. Further, the only real issues between the
    parties are financial, and Cioccas right to pursue any and all financial
    claims is expressly preserved.

Analysis

[14]

I
    do not agree with the appellants arguments.

[15]

First,
    the application judge had the jurisdiction to make the order in question. There
    were no disputed facts with respect to the termination of the joint venture,
    and the appellants agree that the effective date of termination was June 30,
    2014. It was also not disputed that, although the JVA was silent on the
    question of how termination would be effected, Timoon would purchase Cioccas
    interest. As Cioccas counsel confirmed, there was never any question of
    winding up the practice. With these acknowledged facts, the question was what
    relief was required to give effect to the contractual right of termination and
    the parties common intention that Ciocca would leave the practice and be
    bought out by Timoon.

[16]

Second,
    there is no basis for the approach Ciocca advocates  that is, recognizing an
    ongoing ownership interest that would permit him to continue to participate in
    the practice as before, while the financial issues are determined. This would
    nullify the termination provision in the JVA, or at least make the termination
    meaningless.

[17]

The
    application judge made the order that was just and reasonable in the
    circumstances and that was open to him on the evidence. Once the joint venture
    was terminated with the common intention that Ciocca would be bought out, there
    was no basis for Cioccas continued involvement in the practice: indeed, the
    evidence demonstrated that the conflict between the two dentists was disruptive
    to the practice, and ultimately could affect the value of the business, its
    continued viability and Cioccas pay-out. On this record, it is clear that termination
    of Cioccas ownership interest was required to give business efficacy to the
    JVAs termination provision and advanced the parties common intention. As a
    practical matter, the only issue between the parties was financial  the
    purchase price for Cioccas interest, and the adjustments, if any, to the
    income allocation for the preceding years. As such, I see no error in the
    application judges approach to the issues and in the order he made.

[18]

As
    for the financial issues, counsel for the appellants argued that Ciocca should
    be entitled to assert claims for loss of profits as owner after June 30, 2014
    up to the date of the application judges decision, and even beyond. In view of
    the broad statement of respondents counsel that all claims the appellants
    might choose to advance remain open, and having rejected the arguments on
    appeal, I consider it advisable to provide clarification to resolve any
    potential ambiguity raised by the terms of the order respecting what claims
    might remain open. While para. 1 of the order terminates the joint venture as
    of June 30, 2014, para. 4 simply declares Cioccas ownership interest
    terminated, without an effective date. However, when read in context, para. 4
    must be understood as terminating Cioccas ownership interest effective the same
    date as the termination of the joint venture; that is, June 30, 2014.

[19]

First,
    this is consistent with para. 17 of the application judges reasons, and
    second, para. 8 of the order directs that the valuation of Cioccas interest
    for the purpose of the buy-out is at June 30, 2014. Accordingly, for the
    purpose of the determination of the financial issues, both the joint venture
    and Cioccas ownership interest are terminated effective June 30, 2014. The
    value of his interest, including goodwill, is to be determined as of that date.

[20]

Finally,
    I would not give effect to the appellants argument that the application judge
    erred in directing a further proceeding to determine the financial issues, if
    necessary, rather than directing the trial of an issue in the application. In
    the circumstances of this case, I am not persuaded that there would be any
    material advantage to directing a trial in the application of the financial
    issues; indeed, the application judges order provides for greater flexibility
    in the parties choice of dispute resolution process. I also observe that, now
    that the parties have certainty respecting the effective date of termination of
    both the joint venture and Cioccas ownership interest, which is also the date
    of valuation for Timoons buy-out of this interest, they are well-equipped to craft
    their own resolution of their financial issues. The parties are strongly
    encouraged to do so in order to avoid the delay and expense of further legal
    proceedings.

Disposition

[21]

The
    appeal is accordingly dismissed. Costs to the respondents fixed at $15,000,
    inclusive of HST and disbursements.

Released: (G.E.) November 25, 2015

K. van Rensburg J.A.

I agree Gloria Epstein
    J.A.

I agree C.W. Hourigan
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Zanewycz v.
    Manryk, 2015 ONCA 749

DATE: 20151105

DOCKET: M45362 (C59915)

Feldman, Lauwers, Benotto JJ.A.

BETWEEN

Walter Zanewycz

Responding party (Appellant)

and

Christine Manryk

Moving Party (Respondent)

Aaron Franks and Michael Zalev, for the Respondent

Walter Zanewycz, Appellant in person

Heard and released orally: October 30, 2015

ENDORSEMENT

[1]

On May 27, 2015, the appellant moved for an extension of time to perfect
    his appeal of the order of Skarica J. dated December 15, 2014. Justice Doherty
    granted the appellants request for an extension of time on the condition that
    he pay $29,275 to the respondent in respect of two unpaid costs orders and the
    costs of the motion before him. Justice Dohertys order also provided that failing
    payment by the appellant to the respondent within 60 days, the respondent was
    entitled to move before a panel of the court for an order dismissing the appeal.

[2]

The appellant has not made the payment required.

[3]

The appellants agreement with the Family Responsibility Office does not
    operate as a stay of Justice Dohertys order or of the costs orders to which
    Justice Doherty referred. Nor does the appeal of Justice Skaricas order
    operate as a stay of the costs orders to which he refers.

[4]

The payment ordered by Justice Doherty not having been made, the appeal
    is dismissed.

[5]

Costs of this motion in the amount $2,000 are payable by the appellant to
    the respondent.

K. Feldman J.A.

P. Lauwers J.A.

M.L. Benotto
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: 4439155 Canada Inc. v. Albert Tower Inc., 2015 ONCA
    859

DATE: 20151207

DOCKET: FILE C59941

Sharpe, Cronk and Miller JJ.A.

BETWEEN

4439155 Canada Inc.

Plaintiff

(Respondent in Appeal)

and

Albert Tower Inc. and Mehdi Fard

Defendants

(Appellant in Appeal)

and

Albert Tower Inc. and Mehdi Fard

Plaintiffs by
    Counterclaim

(Appellants in Appeal)

and

4439155 Canada Inc. and Zhengping Yang

Defendants by Counterclaim

(Respondents in
    Appeal)

Marcus Boire, for the appellants

Steven Greenberg, for the respondents

Heard and released orally: December 3, 2015

On appeal from the judgment of Justice Robert Smith of
    the Ontario Superior Court of Justice, dated January 19, 2015.

ENDORSEMENT

[1]

This appeal arises from the termination of a commercial lease. We will
    refer to the appellant landlord, Albert Tower Inc., and its principal officer,
    Mehdi Fard, collectively as the appellant and the respondent tenant, 4439155 Canada
    Inc. and its principal, Zhengping Yang, collectively as the respondent.

[2]

The trial judge found as a fact that the appellant landlord had wrongly
    terminated the lease as the parties had reached an agreement on the quantum of
    arrears owing and that the landlord had thereby waived any additional arrears.

[3]

We do not agree with the appellant that the trial judge erred by finding
    there was such an agreement on the ground that the agreement and waiver had not
    been pleaded. The respondent did plead that there were no arrears. The issue of
    whether or not there was an agreement and waiver was fully canvased at trial
    and the appellant did not object to evidence being led on the ground that those
    issues had not been pleaded. In the absence of an objection, we are not
    persuaded that the appellant was in any way prejudiced.

[4]

We see no error in law in relation to the trial judges finding of
    waiver.

[5]

There was evidence that the landlord prepared a written summary of the
    arrears he claimed and evidence that the parties had agreed on those arrears. The
    trial judge accepted that evidence. The trial judge further found that one of
    three post-dated cheques given to the appellant by the respondent in
    satisfaction of the agreed arrears was cashed. On those factual findings, the
    trial judge was entitled to find that the landlord had unequivocally waived any
    amount in excess of the arrears as stated in the written summary he prepared
    and as agreed to by the parties.

[6]

The appellant argues that the trial judge erred in accepting the
    evidence of Mr. Yang and rejecting that of Mr. Fard in relation to the agreement.
    The trial judge explained the basis for his findings of credibility. They
    attract deference on appeal and we are not persuaded that there are any grounds
    for us to interfere with the trial judges acceptance of Mr. Yangs evidence
    and rejection of Mr. Fards.

[7]

The appellant seeks a reduction of the amounts owing on two grounds. The
    first relates to taxes. This was a net lease that allowed the landlord to
    require the tenant to pay its share of the estimated annual taxes during the
    first six months of the year. The landlord exercised that right. In our view,
    it was entirely open to the trial judge to find that the tenant was entitled to
    a credit for the taxes it had paid for that period of the lease that followed
    the wrongful termination.

[8]

The second ground relates to the amount the trial judge found the
    appellant should pay on account of the respondents equipment left in the premises.
    In our view, it was open to the trial judge to find on the basis of Mr. Yangs
    evidence, when read in light of the landlords agents letter dated August 22,
    2011 that clearly stated that the landlord required the tenant to pay the
    arrears he claimed as a precondition for the tenant being allowed to access the
    premises to retrieve his equipment, that the tenant had been wrongfully
    deprived of the equipment.

[9]

The final point relates to an apparent typographical error as to the
    trial judges assessment of the value of that equipment. At para. 59 of his
    reasons he states the value to be $7,500 but at para. 66 and in the judgment
    the value is stated to be $17,500. This is a matter to be resolved by the trial
    judge and we refer it back to him if the appellant wishes to pursue the issue.

[10]

For
    these reasons, the appeal is dismissed.

[11]

Costs
    payable to the respondent fixed at $15,000, inclusive of disbursements and
    applicable taxes.

Robert J. Sharpe J.A.

E.A. Cronk J.A.

B.W. Miller J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: 8527504 Canada Inc. v. Sun Pac Foods Limited, 2015
    ONCA 916

DATE: 20151223

DOCKET: M45642 & M45643

van Rensburg J.A. (In Chambers)

BETWEEN

M45642

8527504 Canada Inc.

Responding Party (Applicant)

and

Sun Pac Foods Limited

Respondent

Application under Section 243 of the
Bankruptcy
    and Insolvency Act
, R.S.C. 1985, c. B-3 and Section 101 of the
Courts of
    Justice Act
, R.S.O. 1990, c. C. 43

AND BETWEEN

M45643

8527504 Canada Inc.

Responding Party (Applicant)

and

Liquibrands Inc.

Respondent

Application under
    Section 243 of the
Bankruptcy and Insolvency Act
, R.S.C. 1985, c. B-3
    and Section 101 of the
Courts of Justice Act
, R.S.O. 1990, c. C. 43

David E. Wires and Krista Bulmer, for the moving party, Csaba
    Reider.

Harvey Chaiton, for the responding party, 8527504 Canada
    Inc.

Anthony J. OBrien, for the responding party, BDO Canada
    Limited, court-appointed receiver of Sun Pac Foods Limited and Liquibrands Inc.

Heard: December 1, 2015

ENDORSEMENT

A.

Overview

[1]

This is a motion for leave to appeal two orders of Newbould J. (the
    motions judge) dated September 28, 2015 (the September 2015 Orders) in two
    related receiverships  of Sun Pac Foods Limited (Sun Pac) and of Liquibrands
    Inc. (Liquibrands). The applicant, Csaba Reider, also seeks leave to appeal
    the costs order of November 5, 2015, if leave is granted in respect of the
    September 2015 Orders.

[2]

The motion is brought under s. 193(e) of the
Bankruptcy and
    Insolvency Act
, R.S.C. 1985, c. B-3
(the BIA). Leave to appeal is discretionary and the court must take a
    flexible and contextual approach. In deciding whether to grant leave, the court
    must consider (a) the general importance of the issues for appeal to the
    practice in bankruptcy and insolvency matters or to the administration of
    justice as a whole; (b) whether the proposed appeal is
prima facie
meritorious;
    and (c) whether proceeding with the proposed appeal would unduly hinder the
    progress of the bankruptcy or insolvency proceedings:
Business Development
    Bank of Canada v. Pine Tree Resorts Inc.
, 2013 ONCA 282, 115 O.R. (3d)
    617, at para. 29.

[3]

For the reasons that follow, the motion for leave to appeal the
    September 2015 Orders is dismissed.

[4]

Essentially, I have concluded that the main issue that the moving party Csaba
    Reider wishes to put before this court  whether the receiver was entitled to
    market and sell a court action commenced by Sun Pac and Liquibrands prior to
    their receiverships (the Action)  was already determined by an earlier order
    of Newbould J., the judge case managing the receiverships. This court
    previously denied leave to appeal that earlier order.

[5]

The fact that the challenge is now made by Mr. Reider, as the director
    of Liquibrands and former director of Sun Pac, and not by Liquibrands itself,
    raising new arguments as to why the Action does not form part of the lenders
    security and cannot be sold by the receiver, is immaterial. Mr. Reider was
    privy to the receivership proceedings throughout and is bound by the earlier determination
    that the receiver was empowered to deal with, and to market and sell, the
    Action.

[6]

To the extent that Mr. Reider raises a new issue that was not decided by
    the earlier orders  whether the credit sale of the Action to a defendant to
    that action ought to have been approved by the court  he has not met the test
    for leave to appeal that decision to this court.

B.

The Companies, the Action and the Receiverships

[7]

Sun Pac was a manufacturer of beverages, croutons and breadcrumbs. In
    November 2011, Sun Pac was acquired by Liquibrands Inc. (Liquibrands), a
    company owned by Mr. Reider.

[8]

8527504 Canada Inc. (852) is Sun Pacs senior secured lender and was
    owed approximately $4 million when the Sun Pac receivership proceedings were
    commenced.

[9]

Sun Pacs debt to 852 was guaranteed up to the amount of $1 million by
    Liquibrands. Liquibrands is also a secured creditor of Sun Pac, and is owed
    approximately $2.6 million.

[10]

On
    852s application, which was not opposed, BDO Canada Limited (BDO) was
    appointed receiver of Sun Pac on November 12, 2013.

[11]

Earlier
    on the day that the order appointing the receiver was granted, Sun Pac and
    Liquibrands commenced the Action in the Superior Court of Justice, against 852
    and Bridging Capital Inc. (together, the Lender Defendants).

[12]

The
    Action alleges, essentially, that the Lender Defendants were in breach of their
    obligations to Sun Pac and Liquibrands under a forbearance agreement, and
    caused the failure of Sun Pac and its inability to pay the Lender Defendants
    and other creditors. The Action claims more than $100 million in damages.

C.

The December 2014 Orders

[13]

On
    December 4, 2014, Newbould J. made three orders (the December 2014 Orders).
    The orders:

·

approved the reports of BDO as receiver of Sun Pac, and permitted
    the receiver to pay the amount realized on the assets of Sun Pac to 852, on
    account of its first ranking security interest, rejecting the argument by
    Liquibrands that the funds should be paid into court pending the determination
    by trial of the issues raised in the Action;

·

appointed BDO as receiver of all of the property, assets and
    undertaking of Liquibrands following its default on the $1 million guarantee of
    Sun Pacs debt to 852, rejecting Liquibrands argument that no receiver should
    be appointed pending the outcome of the Action; and

·

refused the request by Liquibrands that a different receiver be
    appointed over the remaining assets of Sun Pac for the purpose of advancing
    the Action.

[14]

Pursuant
    to the motions judges December 4th endorsement, the receiver was to propose a
    marketing process for the sale of the Action that would be settled by the court
    absent agreement. Counsel for 852, the receiver and Liquibrands negotiated and
    agreed to the terms for the marketing process which were included in an order
    in the Sun Pac receivership as well as the order appointing BDO as receiver of
    Liquibrands. The terms included the following:

(d)

the Action is being offered for sale subject to the terms and conditions
    set out in the [Asset Purchase Agreement prepared by BDO];

(e)

[852] may be an offeror and may make its offer by way of credit bid or
    otherwise without prejudice to any party to oppose the right of [852] to make
    an offer or to oppose any offer made;

(g)

the
    sale of the Action shall be conditional upon [court] approval of same

D.

The First Motion for Leave to Appeal

[15]

Liquibrands
    motion for leave to appeal the December 2014 Orders was dismissed on April 2,
    2015.

[16]

In
    its motion for leave, Liquibrands asserted, among other things, that the
    motions judge erred in finding that the Action was collateral [under 852s
    security] and in ordering BDO to conduct a marketing process for the sale of
    the Action.

[17]

Feldman
    J.A., sitting in chambers, noted in her endorsement that the issue of
    importance asserted for appeal was whether the lender should be entitled to
    profit from its breach of the forbearance agreement by creating a
fait
    accompli
of the receivership and the disposal of the litigation against
    it. She noted that Liquibrands wanted to see the Action continued and
    concluded before the rights of the parties to the proceeds of the receivership
    were finally determined.

[18]

Feldman
    J.A. concluded that to proceed as proposed by Liquibrands would turn the
    process inside out, allowing the debtors, through a funded receiver, to use the
    funds realized in the receivership to fund their action rather than to pay 852.
    She found that the December 2014 Orders were grounded in law and reason, and
    were based on the facts and the documents presented. She concluded that the
    orders were owed deference.

[19]

After
    noting that Liquibrands was not objecting to the procedure for marketing the
    Action in the event that its request that a separate receiver be appointed to
    pursue the lawsuit was rejected, Feldman J.A. observed, at para. 15:

I raised some issues in oral argument regarding the propriety
    of [the marketing] procedure, particularly with respect to who should be
    permitted to bid and how to fairly determine the value of the lawsuit. Counsel
    for the receiver advised the court that all issues regarding the propriety of
    any proposed sale of the action could be raised at the approval hearing. In the
    circumstances of this case, the denial of leave to appeal is not to be taken as
    an endorsement of all aspects of the procedure for marketing the lawsuit
    against the creditor.

E.

The Sale Process

[20]

The
    receiver then marketed the Action, following the process set out in the
    December 2014 Orders. The deadline for receipt of offers was May 15, 2015. Two
    offers were received: a cash offer for $100 from Liquid Brands Inc., signed
    by Mr. Reider as president, and a credit bid from 852 for $1 million. The
    receiver accepted 852s offer, subject to court approval.

F.

The Next Set of Motions

[21]

After
    making his offer, but before the bids were opened, Mr. Reider served a notice
    of motion seeking an order permitting him to advance the Action under the
    residual authority of the directors of the companies. He proposed to pledge
    the assets of Liquibrands not covered under the receivership order as security for
    costs of the Action. In the alternative, he sought an order prohibiting 852
    from bidding to purchase the Action.

[22]

Mr.
    Reider argued that it would be a conflict of interest for a receiver of a
    debtor to be involved and in control of litigation by the debtor against the
    secured creditor that caused the receivership, and that such litigation can be
    pursued under a directors residual powers: see
Maple Leaf Foods Inc.

v.

Markland Seafoods Limited,
2007 NLCA 7, 279 D.L.R. (4th) 682, and
Re
    Inyx Canada Inc.
(2007)
,
    36 C.B.R. (5th) 154, [2007] O.J. No. 3846 (S.C.).

[23]

The
    receiver moved for court approval of the sale of the Action to 852, and the
    motions were argued together on June 22, 2015.

G.

The September 2015 Decision and Orders

[24]

In
    the September 2015 Orders, the motions judge dismissed Mr. Reiders motion, and
    approved the sale of the Action to 852.

[25]

The
    motions judge held that the order sought by Mr. Reider was directly contrary to
    the December 2014 Orders which authorized the receiver to conduct a sale process
    for the Action, and in respect of which leave to appeal was denied. Having been
    involved in the proceedings as an active participant and as a privy to both
    Liquibrands and Sun Pac, Mr. Reider was bound by the earlier orders.

[26]

The
    motions judge also dismissed Mr. Reiders argument that he was not bound
    because the December 2014 Order directing a sale process for the Action was not
    a head of relief sought by 852 in its motion material leading to that order. The
    receivers right to sell the Action had been raised in 852s supplementary
    factum and thoroughly argued before the motions judge and in the earlier leave
    to appeal motion. Nothing in the decision refusing leave to appeal preserved
    any right to challenge the sale process that had been agreed on, and approved
    by the court.

[27]

The
    motions judge then considered Mr. Reiders objection to 852 as a purchaser. He
    referred to various cases recognizing the power of a trustee in bankruptcy to
    sell to a defendant an action commenced by the bankrupt against that defendant,
    even where it meant that the sale would end the litigation: see
Re Almadi
    Enterprises
, 2014 ONSC 1020, 12 C.B.R. (6th) 162;
Re Katz
(1991),
    6 C.B.R. (3d) 211, [1991] O.J. No. 1369 (Ont. Gen. Div.),
Watt v. Beallor
    Beallor Burns Inc.
(2004), 1 C.B.R. (5th) 141, [2004] O.J. No. 450 (Ont.
    S.C.) He saw no reason not to apply the principles from these bankruptcy cases
    to a receivership, concluding that the duty of a receiver to maximize the
    assets for the benefit of all interested stakeholders is no different from the
    duty of a trustee in bankruptcy to maximize the assets for the benefit of all
    creditors.

[28]

The
    motions judge approved the sale of the Action to 852 by credit bid. It could
    not be said that the credit bid by 852 deterred potentially interested parties
    from submitting a bid. The person most knowledgeable about the Action,
    Mr. Reider, bid only a nominal amount, and it could not be expected that
    unconnected and unrelated third parties would be interested in bidding on the
    litigation since they would need the full cooperation and participation of the
    principals of the company to pursue it successfully. The agreed sale process that
    provided for notice to be given just to parties on the service list was a
    reflection of that reality. The credit bid was acceptable, as whether 852 bid
    cash or credit, it would sustain a shortfall in the receivership.

[29]

After
    receiving written submissions, the motions judge awarded costs against Mr.
    Reider and in favour of 852 in the amount of $27,500, and in favour of the
    receiver in the sum of $6,000, plus HST. He rejected Mr. Reiders argument that
    costs should not be awarded against him personally but against Liquibrands, for
    whose benefit he claimed to be acting in bringing his motion and opposing the
    receivers motion.

H.

Analysis

[30]

The
    applicant acknowledges that the motions judges orders made in the course of
    the receiverships are entitled to deference. The applicant asserts that the
    proposed appeal raises important legal questions, and is
prima facie
meritorious. I note that in this case, the third part of the
Pine Tree
    Resorts
test is not at issue, as there is no question of delaying the
    progress of the substantially completed receiverships.

[31]

The
    applicant asserts that the proposed appeal raises two important issues of
    interest to insolvency practitioners and the administration of justice in
    general. The first concerns a directors residual right to pursue an action
    that belongs to a company in receivership. The second is whether a court-appointed
    receiver can sell an action by the company in receivership to a defendant to
    that action.

(1)

The First Issue

[32]

In
    order to advance an appeal on the issue respecting the residual authority of a
    director to pursue an action by a company in receiver, the applicant must
    overcome the conclusion that the receivers right to sell the Action was
res
    judicata,
as the December 2014 Orders were binding on him. That he cannot
    do. As such, there is no
prima facie
merit in Mr. Reiders proposed
    appeal on this issue.

[33]

The
    receivers right to sell the Action was determined by the December 2014 Orders,
    and provided for a specific and agreed upon sale process. The only issue left
    open was court approval of any sale, including the right to challenge 852 as a
    bidder and purchaser of the Action.

[34]

There
    is no merit to Mr. Reiders argument that the December 2014 Orders are not
    binding because the receiver never moved before the court for authority to sell
    the Action.

[35]

That
    argument, as well as several other points advanced by Mr. Reider, were
    addressed in the earlier motion for leave to appeal, including: that the Action
    could not be collateral or property used in the business of Sun Pac for the
    purposes of the receivership, that an action by a debtor against a lender does
    not form part of the lenders security, and whether the court erred in
    directing BDO to sell the Action.

[36]

Further,
    I agree with the motions judges rejection of Mr. Reiders argument based on
    the passage noted above from the decision refusing leave to appeal from the
    December 2014 Orders. Feldman J.A. noted that the parties (including
    Liquibrands) had
agreed
to the sale process, and that the dismissal of
    leave to appeal should not be interpreted as the courts
endorsement
of
    all aspects of the sale process. Her order refused leave to appeal the orders
    authorizing the receiver to deal with and to sell the Action. What was left
    open was not a further challenge to the entire sale process, but, a challenge
    to court approval of the sale (as per the terms agreed between the parties),
    including 852 as a bidder or purchaser.

[37]

Mr.
    Reider relies on provisions in the receivership orders that permit any
    interested party to apply to the court to vary or amend the orders, as well as
    the general ability of the court to review, rescind or vary any order under its
    bankruptcy jurisdiction, pursuant to s. 187(5) of the BIA.

[38]

What
    Mr. Reider is seeking goes far beyond the variation of an order, and amounts to
    an attempt to relitigate what was already decided. Mr. Reider is bound by the
    December 2014 Orders. He was fully involved in the receivership proceedings and
    had notice of everything that occurred. He had the opportunity to challenge the
    receivers right to sell the Action on whatever basis he saw fit to advance. As
    the companys only director, he was the deponent of the affidavits filed by
    Liquibrands in the earlier motions. Whatever the potential merits of Mr. Reiders
    new argument respecting his rights as a director in relation to an action commenced
    by a company in receivership, he lost the opportunity to make such arguments
    when the motions judge ordered the sale of the Action, and approved a sale
    process agreed to between the parties.

(2)

The Second Issue

[39]

The
    second proposed issue for appeal is whether a receiver can sell the debtors
    action to a defendant to that action, and whether the sale can be by way of
    credit.

[40]

The
    issue, as raised in this case, has no
prima facie
merit.

[41]

First,
    once the motions judge determined that the receiver had the right to sell the
    Action, the parties agreed to the sale process  essentially, they agreed that
    the Action would be auctioned after notice to the companies creditors. Mr. Reider
    does not object to the process, but only to the approval of a sale to 852.

[42]

The
    motions judge relied on case law that authorizes a court officer to sell a
    cause of action by a debtor against a creditor to such creditor, whether by
    credit bid or otherwise. Mr. Reider offers no principled reason why the motions
    judge erred in applying bankruptcy cases to the sale in a receivership of a
    court action to a defendant.

[43]

In
    this case, the sale process was agreed upon and approved in the December 2014
    Order. The question then was whether the court should approve the sale. No
    issue is taken by Mr. Reider to the motions judges consideration of the sale
    under the governing principles articulated in
Royal Bank of Canada v. Soundair
    Corp.
(1991), 4 O.R. (3d) 1 (C.A.).
The motions judge supported the receivers recommendation as a proper business decision.
    He considered the potential effect of 852 being a bidder, and the net benefit
    to the receivership resulting from a credit bid.

[44]

Further,
    Mr. Reider did not demonstrate any real interest in pursuing the Action. As
    early as April 2014, the receiver had inquired whether Liquibrands or Mr.
    Reider was interested in purchasing Sun Pacs interest in the Action, and had
    received no response. Likewise, for more than a year after the Action was
    commenced, and before BDO was appointed receiver of Liquibrands, Mr. Reider had
    done nothing to advance the Action. As such, there was nothing to suggest that
    Mr. Reiders bid for $100 was anything other than a reflection of his presumed
    value of the Action. For any different result, the court would have to be
    satisfied that there was some value to the Action beyond what 852 was owed.

[45]

In
    any event, the bulk of the arguments Mr. Reider raises in objecting to 852s
    purchase of the Action simply reiterate the earlier objections to the receiver
    dealing with and selling the Action. No other reasons are advanced for why a
    sale to 852 should not be approved.

I.

Disposition

[46]

For
    these reasons, the motion for leave to appeal the September 2015 Orders is
    dismissed.

[47]

As
    leave to appeal the September 2015 Orders is refused, there is no need to
    address Mr. Reiders request for leave to appeal the costs order dated November
    5, 2015. This too is dismissed.

[48]

The
    moving party, Mr. Reider, shall pay 852 its costs fixed at $15,000, and BDOs
    costs fixed at $10,000, both amounts inclusive of disbursements and applicable
    taxes.

K. van Rensburg J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: 990114 Ontario Ltd. (Paradise Bingo) v.
    Munsee-Delaware Nation, 2015 ONCA 923

DATE: 20151223

DOCKET: C60443

Sharpe, Brown and Roberts JJ.A.

BETWEEN

990114
    Ontario Ltd., operating as Paradise
    Bingo, and Michael Duval

Appellants

and

Munsee-Delaware
    Nation, Patrick Waddilove,
    Jody Waddilove and
    Carmen Dolson

Respondents

Raymond Colautti, for the appellants

Sean Flaherty, for the respondents

Heard and released orally: December 18, 2015

On appeal from the judgment of Justice A.K. Mitchell of
    the Superior Court of Justice, dated April 20, 2015.

ENDORSEMENT

[1]

The appellants appeal a decision dismissing their action for delay pursuant
    to Rule 48.13(14).

[2]

The appellants failed to comply with the timetable laid down at the
    first status hearing and, at a second status hearing, they were unable to
    provide the motion judge with a satisfactory explanation for their failure to
    move the action to trial.

[3]

The motion judge followed the principles laid down by this courts
    decision in
1196158 Ontario Inc. v. 6274013 Canada Ltd.
, 2012 ONCA 544,
    and dismissed the action.

[4]

We see no error that would justify this court in interfering with the
    motion judges discretionary decision.

[5]

We agree with the motion judges conclusion that the only thing
    throughout the six-year history of this action that has spurred the appellants
    into action was the issuance of status notices.

[6]

We do not agree that the fact that the respondents took the position
    that Danny Branoff had drafted the lease provided the appellants with an excuse
    for failing to move this action forward. That allegation did not amount to a
    new defence but rather was evidence of a defence already pleaded, namely, that
    the appellants did not rely on representations made by the respondents.

[7]

Nor do we agree that the respondent can be faulted for asking that the
    matter be struck from the trial list in October 2013. The appellants consented
    to that request which was prompted by their failure to respond to the
    respondents request for a discovery plan several months earlier.

[8]

The motion judge carefully considered the history of this case and she weighed
    the relevant factors. We see no error in fact or principle.

[9]

Accordingly, the appeal is dismissed.

[10]

Costs
    to the respondents fixed at $7,500, inclusive of disbursements and taxes.

Robert J. Sharpe J.A.

David Brown J.A.

L.B. Roberts J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: AB2000 Software Corporation v. Infinium Capital
    Corporation, 2015 ONCA 829

DATE: 20151202

DOCKET: C57543

Cronk, Lauwers and van Rensburg JJ.A.

BETWEEN

AB2000 Software Corporation, Alexandre Bevziouk

Appellants

(Plaintiffs by Counterclaim)

and

Infinium Capital Corporation

Respondent

(Defendant to the Counterclaim)

Alexandre Bevziouk, acting in person

Daniel J. Stern, for the respondent

Heard: September 2, 2015

On appeal from the judgment of Justice Alfred J. OMarra
    of the Superior Court of Justice, dated July 29, 2013, and from his costs
    endorsement, dated October 24, 2013, with reasons reported at 2013 ONSC 5022
    and 2013 ONSC 6616.

van Rensburg J.A.:

A.

Overview

[1]

This is an appeal from the dismissal of the appellants counterclaim
    against the respondent. The appellants assert that the trial judge erred in concluding
    that the contract governing the relationship between the parties had been
    terminated for cause and in rejecting the appellants claims for commissions
    and other compensation. The appellants also seek leave to appeal the costs
    awarded against them in favour of the respondent.

[2]

For the reasons that follow, I would allow the appeal in part with
    respect to the unpaid salary and bonuses, and would allow the costs appeal in
    part. I would dismiss the appeal on all remaining issues.

B.

Facts

[3]

In March 2004, the appellant Alexandre Bevziouk was hired as the Chief
    Technology Officer (CTO) for the respondent Infinium Capital Corporation
    (Infinium). Infinium was founded in 2002 as a securities trading company
    engaged in proprietary capital trading. While employed elsewhere full-time, Mr. Bevziouk,
    working as a software developer, had helped Infinium to develop its electronic
    trading platform in 2003. After he was hired as CTO, Mr. Bevziouk developed,
    installed, and operated an algorithmic trading system for inter-listed arbitrage
    (the algo-trading system) for Infinium.

[4]

There were two consecutive service agreements entered into between
    Infinium and Mr. Bevziouks corporation, AB2000 Software Corporation (AB2000
    Software). The service agreements provided for the terms and conditions of the
    work to be performed by Mr. Bevziouk, and his compensation.

[5]

The first service agreement was dated March 30, 2004. In March 2006, the
    parties executed a mutual release of their obligations under that agreement and
    entered into a second agreement with somewhat different terms, including an
    increase in the monthly payment to AB2000 Software, and eliminating Mr. Bevziouks
    stock option (for which Infinium paid him $50,000). The second service
    agreement, which was backdated to December 1, 2005, was in effect when Mr.
    Bevziouks services were terminated.

[6]

On October 2, 2006, Infinium terminated the service agreement for cause,
    alleging that Mr. Bevziouk was competing with it and taking steps to sabotage the
    algo-trading system. Shortly thereafter, Infinium commenced a legal action
    against Mr. Bevziouk, his company and other defendants, for damages and other
    relief, including injunctive relief that was granted on consent. The appellants
    counterclaimed in the action, asserting a claim for unpaid compensation under
    the service agreement and damages for wrongful dismissal.

[7]

The main action was discontinued against the other defendants in
    September 2012. A few weeks before the trial of the counterclaim, the main
    action was discontinued on consent against the appellants, with costs to be
    determined by the trial judge.

C.

The Trial Decision

[8]

The trial judge dismissed the counterclaim. He rejected the claim that
    AB2000 Software was owed commissions, salary and bonuses under the service
    agreement. He concluded that Infiniums concerns about competition and sabotage
    were well-founded and that the termination of Mr. Bevziouks services was for
    just cause. The trial judge awarded costs of the action to Infinium in the sum
    of $260,599.38, payable by both appellants.

D.

The Appeal

[9]

The appellants appeal the judgment dismissing their claim, and seek
    leave to appeal the costs award against them. The appellants raise three issues
    on appeal. First, they contend that the trial judge erred in his interpretation
    of the service agreement with respect to compensation. Mr. Bevziouk asserts
    that he was entitled to receive three types of compensation that had been
    earned at the time of termination but not paid: commissions on trades made by
    Infinium traders using the algo-trading system he had developed, salary for the
    last month before his termination, and bonuses (which were paid but not in the
    amounts claimed by Mr. Bevziouk).

[10]

Second,
    the appellants contend that the trial judge erred in finding that the service
    agreement was terminated for just cause.

[11]

Third,
    the appellants seek leave to appeal the costs award, asserting that it was an
    error in principle for the trial judge to award Infinium costs for a claim that
    it withdrew on the eve of trial and, further, that the costs award is excessive.

[12]

Infinium
    asserts that there was no error on the part of the trial judge, and that all the
    findings now challenged by the appellants, which were findings of fact, were
    amply supported by the evidence. Further, the trial judges costs award reflects
    a proper exercise of his discretion having regard to, among other things, the
    fact that Infinium bettered its offer to settle at trial.

E.

Analysis

(1)

The Service Agreement

[13]

The
    service agreement in force at the time of termination, under the heading
    Compensation, provided the following with respect to monthly payments and
    bonus:

a) Pay-out:

In determination of your monthly pay-out, the Company will
    assess its monthly trading profit earned from trading utilizing strategies
    developed and personally supervised by you, less deductions applicable to your
    trading, including execution, clearing and capital costs, if any. Your
    individual compensation target is set to 10% (ten per cent) of the monthly net
    trading profit attributable to your trading or $14,583.33, whichever is
    greater. Payment will be made in the month immediately following the applicable
    trading month.

b) Discretionary Bonus, paid, if any, quarterly. Restricted
    component of the Discretionary Bonus, if any, shall be vested in two years from
    the date granted.

[14]

During
    the course of his employment, Mr. Bevziouk received a monthly payment, which at
    the time of his dismissal was $14,583.33. While employed pursuant to the second
    service agreement, he also received two bonuses of $12,500, for the first two
    quarters of 2006.

(2)

Claim for Commissions

[15]

By
    far the most significant aspect of the appellants claim at trial was the claim
    for commissions. The algo-trading system developed by Mr. Bevziouk was deployed
    in 2005. He asserted a claim for a 10% commission on all the trading profits
    generated by the algo-trading platform from January to September 2006, in the amount
    of $686,801.25. He relied on the terms of the service agreement as expressly
    providing for the payment of commissions. Mr. Bevziouk maintained that the
    algo-trading platform he developed realised considerable profits for Infinium,
    resulting in increased earnings from $6.8 million to over $100 million annually.
    Mr. Bevziouk expected to receive commissions from Infiniums profitability
    based upon his contributions.

[16]

The
    claim for commissions was rejected by the trial judge. His conclusion that
    there was no contractual right to the payment of commissions was fully
    supported by the evidence. First, the wording of the agreement with respect to
    commissions does not fit with the role of Mr. Bevziouk within Infiniums organization.
    He was a software developer, not a securities trader. The trial judge accepted
    the evidence of Infiniums principals that the pay out wording in the service
    agreement was based on a template used by Infinium for contracts with its
    strategists and traders, and that Infinium never intended to compensate AB2000
    Software by payment of commissions.

[17]

The
    trial judge also accepted the opinion of an expert in the administration and
    application of securities law and regulation in Ontario that Mr. Bevziouk could
    not have been a trader as understood in the terms of the service agreement,
    because he was not qualified or registered as such under the applicable
    regulations.

[18]

Further,
    no commissions were ever paid under either service agreement. Although Mr.
    Bevziouk was persistent in seeking enhanced compensation in his emails with Infiniums
    principals, he focused on the question of bonus and salary, and never raised
    the issue of commissions. The trial judge specifically rejected Mr. Bevziouks
    testimony at trial that he had made verbal requests for commissions as
    inconsistent with these email exchanges. Rather, he found that the claim for
    commissions was first asserted in the appellants counterclaim.

[19]

Under
    the terms of the service agreement, Mr. Bevziouk would only have been entitled
    to commissions on trades utilizing strategies he had developed and personally
    supervised. However, Mr. Bevziouk had never devised a trading strategy or supervised
    its use. As the trial judge observed, the traders and strategists provided Mr.
    Bevziouk with the strategies for which he was to design software to execute the
    trading ideas.

[20]

In
    all the circumstances, I see no error in the trial judges rejection of the
    appellants claim for commissions. To the contrary, I agree with it.

[21]

The
    trial judge did not address in any detail the appellants claims for unpaid
    salary and bonuses, which were admittedly a very small portion of the $12
    million in damages claimed by them at trial. He simply concluded that Infinium had
    not breached its contract with the appellants. I turn now to those claims.

(3)

Claim for Unpaid Salary

[22]

The
    service agreement was terminated on October 2, 2006. Infinium did not make the
    monthly payment of $14,583.33 to AB2000 Software for September 2006. At trial, Infinium
    explained that it withheld payment as a set-off against the damages it believed
    that it had suffered as a result of the appellants conduct in the context of
    the law suit it was contemplating, and that Mr. Bevziouk had not in fact
    performed any duties and had not delivered anything that month. As Sergei Tchetvertnykh,
    a principal of Infinium, explained: our original decision to go and sue him
    for damages was, in our mind, much greater than the sum that we owed him for
    September.

[23]

I
    agree with the appellants that there was no basis for Infinium to withhold the
    monthly payment for September 2006, which covered a period before the service
    agreement was terminated. While the appellants failure to perform may have
    justified Infiniums termination of the service agreement, it is not a
    reasonable interpretation of the agreement that Infinium was entitled to
    withhold payment. Further, Infinium discontinued its claim against the
    appellants and is therefore not entitled to a set-off for Septembers
    salary.  AB2000 Software therefore is entitled to the sum of $14,583.33
    for the month of September 2006, plus prejudgment interest on that amount.

(4)

Claim for Unpaid Bonuses

[24]

The
    service agreement provided for the payment of a quarterly bonus as follows: Discretionary
    Bonus, paid, if any, quarterly. Restricted component of the Discretionary
    Bonus, if any, shall be vested in two years from the date granted.

[25]

For
    each of the first two quarters of 2006, Infinium advised Mr. Bevziouk that he
    had earned a quarterly bonus of $25,000. However, Infinium withheld one half of
    the amount, paying the total sum of $25,000 in two instalments of $12,500. The
    appellants contend that they are entitled to the sum of $25,000 for the first
    two quarters of 2006 (the balance that was withheld), as well as the sum of
    $25,000 for a bonus that was declared for the third quarter of 2006 but never
    paid.

[26]

Infinium
    contends that the bonus was discretionary and based on satisfactory performance,
    and that the appellants have no right to challenge the amounts that were paid
    or withheld.

[27]

The
    trial judge did not specifically deal with the bonus issue.

[28]

The
    evidentiary record discloses that Infinium declared the appellants entitlement
    to a $25,000 bonus in each of the first two quarters of 2006. The explanation
    for withholding the bonus was that Mr. Bevziouk would be participating in a
    long term incentive plan as a result of which half of the bonus was
    restricted and would be paid subject to satisfactory performance two years
    later. There was, however, no agreement by the appellants to participate in
    such a plan. In any event, Infinium admitted at trial that no other employee
    participated in this plan and that no plan was ever formalized. In these
    circumstances, although the bonus was discretionary, once declared, there was
    no basis for Infinium to impose unilateral terms on its payment. AB2000
    Software is therefore entitled to the sum of $25,000, plus prejudgment
    interest.

[29]

The
    appellants claim entitlement to a bonus for the third quarter of 2006 on the
    basis that a bonus was declared for that quarter but not paid. The appellants
    rely on an email dated July 18, 2006 where Mr. Tchetvertnykh says that
    Mr. Bevziouk would definitely get the bonus
this
quarter, but
    that he could not sign off on it at that moment because Infinium had not
    completed its mid-year reviews. Infinium argues that this email referred to the
    bonus for the second quarter, which was in fact paid to the appellants.

[30]

I
    agree with Infiniums contention that this email clearly refers to the bonus
    for the second quarter of 2006. Mr. Bevziouk admitted this interpretation of
    the email in his cross-examination at trial. The record discloses no evidence
    that Infinium ever declared a bonus for the third quarter; indeed, having
    regard to the concerns about Mr. Bevziouks conduct at that time, it would be
    surprising if Infinium had decided to pay him a bonus for the third quarter of
    2006.

[31]

Accordingly,
    I would reject the appellants claim for a 2006 third quarter bonus.

(5)

Cause for Termination

[32]

The
    appellants contend that the trial judge erred in concluding that Infinium had
    just cause for termination of the service agreement. The trial judge found that
    Mr. Bevziouk had taken various steps in an effort to control access to the
    algo-trading system and to compete with Infinium. Mr. Bevziouk acknowledged
    that he removed the source code from the server and inserted a password
    protected zip file. He also acknowledged inserting extra code into the server code
    to prevent it from loading. The effect of these steps was that Mr. Bevziouk had
    complete control over the algo-trading system, and that, without his
    intervention, the system would not work.

[33]

The
    trial judge considered and rejected Mr. Bevziouks contention that there was a
bona
    fide
security reason for the actions he had taken. He accepted the
    evidence of Infiniums expert witness that the insertion of the code did not
    provide any theft deterrence, and that its only purpose was to permit Mr. Bevziouk
    to have complete control over the loading of the system, with no benefit to
    Infinium. He also accepted that the code, or malware, had the potential to
    cause serious disruption to Infiniums securities trading operations.

[34]

Further,
    there was overwhelming evidence at trial that Mr. Bevziouk, while engaged by
    Infinium under the terms of the service agreement, was attempting to promote
    certain software that would enable Infiniums competitors to engage in
    algorithmic trading. The fact that his negotiations with third parties did not
    bear fruit is irrelevant.

[35]

The
    trial judge did not err in concluding that Mr. Bevziouks employment was
    terminated for cause. This finding was amply supported by the evidence at
    trial.

(6)

Costs of the Proceedings

[36]

The
    appellants seek leave to appeal the trial judges award of costs in favour of
    Infinium in the sum of $260,599.38.

[37]

Infinium,
    having been successful at trial in defending the counterclaim, sought costs of the
    proceedings in the sum of $299,499.35. This amount was comprised of its costs
    from the commencement of the counterclaim until May 14, 2013 on a partial
    indemnity basis and thereafter on a substantial indemnity scale. The claim for
    substantial indemnity costs after May 14, 2013 was based on the conduct of the
    appellants and their counsel, and also on the fact that, on May 30, 2013,
    shortly before the trial, Infinium had served an offer to settle the
    counterclaim by payment of the sum of $105,000, plus costs. In the alternative,
    Infinium sought partial indemnity costs of $260,599.38 for the entire
    proceedings. This is the amount that was awarded by the trial judge.

[38]

The
    appellants submit that the trial judge erred in principle in making a costs
    award that effectively allowed Infinium its costs of pursuing the main action,
    which was discontinued before trial of the counterclaim. Given that Infinium discontinued
    the main action two months before trial, there should have been no costs
    ordered to either side. Alternatively, the appellants contend that the costs award
    was grossly disproportionate having regard to the fact that the trial lasted
    only six days.

[39]

Leave
    to appeal costs is granted sparingly. Further, this court will interfere with a
    discretionary award of costs only where there has been an error in principle or
    the costs award is plainly wrong:
Hamilton v. Open Window Bakery Ltd.
,
    2004 SCC 9, [2004] 1 S.C.R. 303, at para. 27. For reasons I will explain, I
    conclude that the test for leave is met in this case. On the merits, I would
    allow the costs appeal in part, based on what I view as the trial judges error
    in principle in dealing with Infiniums offer to settle.

[40]

The
    trial judge concluded that, where a defendant in an action that is dismissed at
    trial made an offer to settle pursuant to r. 49 of the
Rules of Civil
    Procedure
, R.R.O. 1990, Reg. 194, a bonus in the form of substantial
    indemnity costs to the defendant is appropriate following the date the offer to
    settle was served. However, in this case, he found that any bonus increase to
    costs as result of the Rule 49 offer being beaten in result will be offset by
    costs thrown away by the plaintiff by counterclaim. Ultimately, he appears to
    have accepted that Infinium would have been entitled to the costs claimed of
    $299,499.35 (which included substantial indemnity costs from the date of its
    offer), but awarded instead costs on a partial indemnity basis throughout, in
    the amount of $260,599.38. The difference, the sum of $38,899.97, represents a
    discount of Infiniums costs to recognize that the appellants would have been
    entitled to a set-off of some costs for their defence of the main action that
    was discontinued.

[41]

The first problem with this approach is that no bonus for Infinium
    bettering at trial its offer to settle the counterclaim
was warranted. Rule 49.10 provides that
where a plaintiff offers
    to settle and obtains a judgment at least as favourable as its offer to settle,
    the plaintiff is entitled to substantial indemnity costs from the date of the
    offer, unless a court orders otherwise. However, as this court explained in
St.
    Elizabeth Home Society v. Hamilton (City),
2010 ONCA 280, 319 D.L.R. (4th)
    74, at para. 90, there is no corresponding provision entitling a defendant to
    substantial indemnity costs where it makes an offer to settle that is greater
    than the amount ultimately awarded. Costs on a substantial indemnity basis
    will only be warranted where the trial judge finds that the behaviour of the
    plaintiff was so egregious as to deserve a sanction:
Clarington
    (Municipality) v. Blue Circle Canada Inc.
, 2009 ONCA 722, 312 D.L.R.
    (4th) 278, at para. 40;
St. Elizabeth Home Society
, at para. 92.

[42]

In
    this case, the trial judge explicitly concluded that the conduct of the
    appellants at trial was not vexatious and that it did not unnecessarily
    lengthen the proceedings. He specifically refused Infiniums request for
    substantial indemnity costs based on the appellants conduct. Consequently,
    costs on a substantial indemnity basis were never available to Infinium, and
    the trial judge erred in finding that they were. Infinium, as the successful
    party in the defence of the counterclaim, was entitled to its costs on a
    partial indemnity basis.

[43]

The
    trial judge ought to have considered separately the question of the appellants
    costs of defending the discontinued main action, and whether the appellants were
    entitled to set-off those costs against any costs of the counterclaim. Having
    defended the main action up to only weeks before trial, the appellants would
    reasonably have expected an award of costs for their defence of the main action.
    As I have said, the main action was discontinued on consent, with costs of that
    action to be determined by the judge presiding at the trial of the
    counterclaim.

[44]

Unfortunately,
    the appellants did not provide the trial judge with a bill of costs for the
    defence of the main action. They simply took the position in their costs
    submissions that there should be a complete set-off of costs up to the time the
    main action was discontinued, except for an additional amount of $5,000 for the
    appellants costs in preparing to defend a contempt motion that was never
    argued. In awarding Infinium the amount it claimed for partial indemnity costs,
    when he was of the view that Infinium was entitled to substantial indemnity
    costs from the date of its offer to settle, the trial judge in effect fixed the
    appellants costs thrown away in defending the main action (which would include
    the motion costs claimed) at $38,899.97, which is the difference between the
    two costs amounts claimed by Infinium.

[45]

I
    would not interfere with the trial judges set-off of $38,899.97 on account of
    the appellants costs of defending the main action as against Infiniums costs
    of the counterclaim proceeding. The appellants did not present a bill of costs,
    and there were numerous overlapping issues between the main action and the
    appellants counterclaim. Accordingly, on the available record, the set-off
    amount cannot be considered unreasonable.

[46]

As for the appellants argument that the costs award was excessive,
    apart from the error noted above, I see no error in principle that would
    justify any further reduction in the costs awarded to Infinium. While the costs
    award is significant, the trial judge considered the complexity of the issues
    in the action, and the fact that the proceedings were outstanding for some six
    years. The award, in my view, is not plainly wrong.

[47]

Finally,
    I have considered whether the appellants partial success on appeal justifies a
    reduction of the costs awarded at trial. The central issues in these
    proceedings concerned the claims for commission and whether Mr. Bevziouk had
    been terminated for cause. On the disposition of the appeal that I propose, the
    appellants have achieved only partial success, with respect to their
    compensation claim and costs. This, in my view, is not a sufficient reason to further
    reduce the costs ordered by the trial judge.

F.

disposition

[48]

Accordingly,
    I would allow the appeal in part. I would set aside the judgment of the trial
    judge dismissing the counterclaim, and grant judgment to the appellants in the
    sum of $39,583.33 (comprised of unpaid salary and bonuses), plus applicable prejudgment
    interest under the
Courts of Justice Act
, R.S.O. 1990, c. C.43. I
    would vary the trial judges costs award by substituting an order for costs in
    favour of Infinium in the sum of $221,699.41 ($260,599.38 - $38,899.97).
    Infinium has asked that any amounts awarded to the appellants on this appeal be
    set off against the trial costs they are required to pay, and I would so order.

G.

COSTS ON APPEAL

[49]

As
    success was divided on the main appeal and the costs appeal, I would order no
    costs in this court.

Released: (E.A.C.) December 2, 2015

K. van Rensburg J.A.

I agree E.A. Cronk
    J.A.

I agree P. Lauwers
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Abdollahpour v. Banifatemi, 2015
    ONCA 834

DATE: 20151202

DOCKET: C59977

Gillese, Blair and Brown JJ.A.

BETWEEN

Ahmad
    Reza Abdollahpour, Sima Abdollahpour

and
    Hamid Abdollahpour

Applicants

(Appellants)

and

Shakiba Sadat Banifatemi

Respondent

(Respondent)

Evan Moore, for the appellants

Kevin Kavanagh, for the respondent

Heard: October 20, 2015

On appeal from the judgment of Justice Robert J. Smith of
    the Superior Court of Justice, dated December 31, 2014, with reasons reported
    at 2014 ONSC 7273, 59 R.F.L. (7th) 40.

R.A. Blair J.A.:

Background

[1]

On March 25, 2012, a young Iranian couple, Ahmad Reza Abdollahpour
    (Reza) and Shakiba Sadat Banifatemi, were married in Ottawa. They separated
    in December 2013, when Shakiba moved out of the marriage and out of the home
    where they had been living with Rezas parents.

[2]

It is the custom in Iranian culture and tradition for the groom or the
    grooms family to provide a dowry or
mahr
to the bride on the occasion
    of the wedding. In this case, Rezas parents, the appellants Sima and Hamid
    Abdollahpour, transferred to Shakiba a 50% interest in a house they owned at 4
    Leona Avenue in Ottawa by way of a Deed of Gift.

[3]

Following the breakdown of the marriage, Reza commenced divorce
    proceedings. Along with Sima and Hamid, he also sought to have the 50% interest
    in the property transferred back to them.

[4]

The appellants principal argument was, and is, that the transfer was
    made as part of the dowry or
mahr
and  according to Iranian culture
    and tradition  was therefore subject to a condition that Shakiba not leave the
    marriage and that, if she did, the property would be transferred back to the donors.
    They also argued that Shakibas father had promised Rezas father that the
    property would be returned if Shakiba left the marriage, that Shakiba had
    entered the marriage with the fraudulent intent to obtain a 50% interest in the
    property and in order to be sponsored as a permanent resident in Canada, and
    that Sima and Hamid had signed the Deed of Gift under duress or as a result of
    undue influence. In addition, Sima and Hamid sought repayment of the costs of
    the wedding and the return of all wedding gifts.

[5]

Shakiba brought a motion for summary judgment dismissing the claims on
    the ground that the transfer of the 50% interest in the property was an
    irrevocable and unconditional gift. She denied the other allegations.

[6]

In thorough and careful reasons delivered on December 31, 2014, Justice
    Robert J. Smith granted summary judgment in favour of Shakiba.

[7]

Reza, Sima and Hamid appeal from the judgment only as it relates to the
    property interest. On appeal, they seek to introduce fresh evidence in the form
    of a translated copy of the marriage contract, in which the 50% interest in the
    property is listed as part of the dowry, and an expert report from an Islamic
    scholar confirming that, in certain circumstances, a dowry (or
mahr
,
    as it is called in the Islamic tradition) is to be returned by the wife upon
    the breakdown of the marriage and opining on what he believes was the intention
    of the parties at the time of the transfer.

[8]

I agree with the motion judge, and would dismiss the appeal for the
    following reasons.

Discussion and Analysis

Fresh Evidence

[9]

I do not need to decide whether the proposed fresh evidence meets the
    necessary requirements for admission on appeal  although I am inclined to the
    view that it does not  because even if admitted, it would not affect the
    outcome of the appeal, in my view.

[10]

The
    issue is not whether Iranian culture or tradition features the characteristics
    explained by the expert, but whether the parties agreed to the transfer being
    subject to the conditions imposed by that culture or tradition. An expert
    cannot give an opinion as to what the parties intentions were  the very issue
    the motion judge had to decide  which is what the proposed expert purported to
    do here.

The Judges Role on the Summary Judgment Motion

[11]

At the time the summary judgment motion was heard, the
Family
    Law Rules
, O. Reg. 114/99 respecting summary judgment had not yet been
    amended to conform to r. 20 of the
Rules of Civil Procedure
, R.R.O.
    1990, Reg. 194. It was unclear whether the motion judge had the expanded powers
    to weigh evidence, evaluate credibility and draw reasonable inferences from the
    evidence that characterize r. 20.04(2.1). The motion judge therefore conducted
    his analysis both on the basis of r. 16(6) of the
Family Law Rules
(which
    requires only that the court determine whether there is a genuine issue
    requiring a trial of a claim or defence) and on the basis of the provisions in
    r. 20.04. He concluded that, on either analysis, there was no genuine issue
    requiring a trial with regard to whether the transfer constituted an
    irrevocable and unconditional gift.

[12]

The
Family Law Rules
have since been amended to
    conform with r. 20.04(2.1), and the appellants now accept, for the purposes of
    the motion and this appeal, that the motion judge and this Court are entitled
    to view the matter from the perspective of the type of expanded powers that are
    provided for under r. 20.04(2.1).

Was the Deed of Gift Conditional or Unconditional?

[13]

I
    see no error in the motion judges finding that the transfer of the 50%
    interest in the property to Shakiba was an irrevocable, unconditional gift and
    that no genuine issue requiring a trial was raised on the record with respect
    to that issue.

[14]

It
    is accepted that the motion judge applied the proper test for the determination
    of a gift: an intention on the part of the donor to make a gift without
    consideration or expectation of remuneration; an acceptance of the gift by the
    donee; and a sufficient act of delivery or transfer of the property to complete
    the transaction. See
McNamee v. McNamee
, 2011 ONCA 533,
335 D.L.R. (4th) 704
.

[15]

The
    appellants do not contest that the second and third criterion were satisfied in
    the circumstances of this case. They submit, however, that the motion judge
    erred in finding that Sima and Hamids intention was to make an unconditional
    gift of the property to Shakiba. Instead, they argue, the intention was to
    provide a dowry or
mahr
to Shakiba  something that is distinct from
    an irrevocable gift in Iranian culture and that was subject to the condition
    that the property would be returned to the donors if Shakiba divorced Reza or
    left the marriage.

[16]

I
    do not accept this submission.

[17]

Taking
    a hard look at the record, as he did, it was open to the motion judge to
    conclude that the terms of the Deed of Gift itself, as well as the evidence of
    the negotiations leading up to its execution  including the exchanges between
    the lawyers, the evolution of the substance of the document, and the draft
    documentation preceding the final Deed of Gift  all confirmed the intention
    that the transfer was irrevocable and unconditional.  In my view, the motion judge
    did not misapprehend the evidence or make incorrect findings of fact that
    materially affected his conclusions in this regard.

[18]

The
    parties each received independent legal advice during the negotiations. Ms.
    Makooli represented Sima and Hamid. Shakibas brother, Shahab, was the
    negotiator for the brides family and he was represented by Mr. Kavanagh.

[19]

The
    original proposal was that a one-third interest in the property would be
    transferred by Sima and Hamid in trust for Reza and Shakiba jointly. A draft trust
    declaration and agreement reflecting this was prepared by Ms. Makooli. It said
    nothing about the trust being revocable on the failure to comply with any
    conditions regarding the marriage.

[20]

In
    a subsequent exchange of emails between the lawyers, Mr. Kavanagh insisted that
    the gift be irrevocable and in an email dated February 28, 2012, Ms. Makooli
    confirmed that ultimately, this is a wedding
gift
to both kids
    (emphasis added). On March 1, 2012, Ms. Makooli sent a revised Deed of Gift
    providing that Sima and Hamid wished to convey an undivided one-third interest
    in the property to Reza and Shakiba jointly
and irrevocably
.

[21]

Shakibas
    father rejected the offer of a one-third interest. He sought a 50% interest for
    Shakiba, and the parties ultimately agreed to this proposal. Mr. Kavanagh took
    the second draft deed prepared by Ms. Makooli and amended it to remove Rezas
    name as a transferee  Sima and Hamid had decided they did not want a 50%
    interest to be transferred to Reza  and to provide that a 50% interest in the
    property be gifted to Shakiba.  A copy of this amended draft was sent to Sima
    on March 12, 2012.

[22]

On
    March 19, 2012, Shakiba met with Sima and Hamid at the offices of a lawyer, Mr.
    Nadon, to sign the necessary documents for the transfer. Included in that
    documentation was an Acknowledgement that [t]he effect of the Documents
    [including the Transfer document] ha[d] been
fully explained
to
    [them] (emphasis added) and a Direction to engross the deed or transfer to
    Shakiba as Tenant in Common part 50% interest. The Deed of Gift itself stated
    that the Grantors wish to convey to the Grantee,
irrevocably
, a fifty
    per cent (50%) title interest in the said lands (emphasis added). Nowhere in
    the exchanges between the lawyers leading up to the transfer, nor in any of the
    documents prepared to complete it, is there mention of any conditions attaching
    to the transfer, other than perhaps the marriage itself.

[23]

After
    a discussion between the families on March 23, 2012, in which Shakibas father
     who was then in Canada  insisted that the Deed of Gift be registered or the
    marriage would not proceed, Sima instructed Mr. Nadon to register the Deed,
    which was done on March 23, 2012.

[24]

Summarizing
    this evidence, the motion judge found that the Deed of Gift was not subject to
    the conditions that Shakiba would not leave the marriage and would continue to
    reside in the property as a matrimonial home for the following reasons:

(a) the intentions of the parties were clearly stated in the
    Deed of Gift, which was prepared to clarify and remove any uncertainty about
    the gift, in addition to registering the transfer of a 50% interest in the
    property to Shakiba;

(b) the parties reduced the terms of the gift to writing in the
    Deed of Gift document, which did not mention any conditions;

(c) none of the written documents prepared by the lawyers
    acting for the parties to complete the gift mentioned that any such conditions
    applied to the gift; and

(d) the husbands parents signed the documents confirming the
    gift with the benefit of independent legal advice.

[25]

These
    findings were entirely open to the motion judge on the record. Apart from the
    statement of Hamid that Shakibas father had promised that the property would
    be returned to Sima and Hamid if Shakiba left the marriage  which the motion
    judge later analysed and to which I will return in a moment  and apart from
    Sima and Hamids own self-serving, after-the-fact testimony, there is no
    evidence respecting any such term or condition in the transfer.

The Stated Representation

[26]

The
    motion judge found, on the basis of the evidence he reviewed, that it was
    unlikely Shakibas father had represented to Rezas father that Shakiba would
    return the interest in the property if she left the marriage. For the purposes
    of his analysis, however, he proceeded on the basis that there was such a
    verbal representation.

[27]

He
    concluded that even if the statement had been made, it did not affect the
    result for two reasons. First, Shakibas father was not a party to the
    transaction (or to the proceedings) and such a representation could not bind
    Shakiba, who is an adult in control of her own decisions and who, on the
    evidence, had not been told of the representation, much less agreed to be bound
    by it. I agree. Secondly, the motion judge concluded that a verbal
    representation or promise to transfer Shakibas interest in the land back to
    Rezas parents would be ineffective in any event because of the provisions of
    ss. 1(1) and 4 of the
Statute of Frauds
, R.S.O. 1990, c. S.19. I do
    not need to deal with the motion judges treatment of s. 4 because I agree with
    his conclusion that s. 1(1) is an effective bar to the appellants argument.

The
Statute of Frauds

[28]

Sections
    1(1) of the
Statute of Frauds
states:

Every estate or interest of freehold and every uncertain
    interest  in  lands  shall be made or created by a writing signed by the
    parties making or creating the same, or their agents thereunto lawfully
    authorized in writing,
and, if not so made or created, has the force and
    effect of an estate at will only
, and shall not be deemed or taken to have
    any other or greater force or effect. [Emphasis added.]

[29]

In
    the face of this provision, the motion judge was correct to hold that a verbal
    representation that Shakiba would re-convey her interest in the property if she
    left the marriage could create nothing more than an estate at will and could
    therefore be terminated at the discretion of Shakibas father (or, presumably,
    of Shakiba).

[30]

Moreover,
    one of the purposes of the writing requirement in s. 1(1) of the
Statute of
    Frauds
is to avoid the very kind of difficulty that has arisen here. As
    the Alberta Court of Appeal observed in
Austie v. Aksnowicz
,
1999 ABCA 56,
[1999] 10 W.W.R. 713, at para. 52, leave to
    appeal refused, [1999] S.C.C.A. No. 172, the whole point of the Statute of
    Frauds is to provide written corroboration of a disputed oral deal.

[31]

Accepting
    for the purposes of this discussion that the marriage contract is admitted as
    fresh evidence, the dowry provision in it states:

Dowry:
One volume of Holy Quran, one rock candy, one
    mirror and two chandeliers, one white rose, and
three parts [out of six
    parts] of a residential house at: 4 Leona Ave., Ottawa, Ontario
. [Emphasis
    added.]

[32]

The
    dowry provision does not disclose, either expressly or by necessary
    implication, what the appellants seek to establish as the additional essential
    term of the transfer by Deed of Gift  namely, the term or condition calling
    for re-conveyance of the property in certain circumstances. That the property
    is referred to as part of the brides dowry and the dowry is part of the
    marriage contract, and that there may be general Iranian cultural norms and
    traditions relating to such marriages, is not enough, in my opinion.

[33]

Even
    if a marriage is entered into in the context of the cultural norms and
    traditions of a couple and their families, the details of how those cultural
    norms and traditions are to apply will inevitably vary from marriage to
    marriage, thus rendering the terms of the conveyance in question difficult to
    ascertain in myriad individual cases. It would be inconsistent with the purpose
    of the
Statute of Frauds
and with the valid public policy need for
    certainty in real property transactions to imply a term or condition into the
    Deed of Gift based on a general cultural norm or tradition and the mere
    reference to the property in question under the heading dowry in the marriage
    contract.

[34]

A
    wide variety of cultures, and their norms and traditions, form an integral part
    of the Canadian mosaic. They cannot simply be imported into a transaction
    involving the transfer of real property by reference to a concept such as
    dowry, which forms a part of a particular culture or tradition. If families
    of the bride and groom in circumstances such as these wish to incorporate such
    a concept into the transfer of property to the bride as part of her dowry, it
    is easy enough for them to say with clarity in the Deed of Gift expressly what
    it is that they intend with respect to the terms of the transfer. The parties
    did not do so in this case.

[35]

If
    ambiguous references were enough to incorporate cultural practices and
    traditions into a real property transaction, as the appellants seek to do here,
    there would be a danger of underlying expectations and motivations arising from
    the cultural context easily becoming conflated with intention. It is the
    parties intention and their actual agreement that must be ascertained. Was the
    transaction a gift and, if so, what were the terms and conditions, if any,
    attached to that gift?

[36]

Finally,
    even if the appellant parents had an underlying motivation for the transfer and
    some unarticulated expectation in relation to it, arising out of their
    Iranian culture and tradition, a valid gift, once made, cannot be revoked or
    retracted and the failure of a donee to fulfill a donors expectations does not
    vitiate a valid gift: see
Berdette v. Berdette
(1991),
81 D.L.R. (4th) 194

(Ont. C.A.), at
    pp. 200-201, leave to appeal refused, [1991] S.C.C.A. No. 306. The Court also
    observed in the
Berdette
case, at p. 199, that it is not the task of
    the court  to correct a possible mistake of judgment on the appellants part,
    but to ascertain the appellants intention at the time of the transactions with
    which we are concerned. That is what the motion judge did here and I agree
    with his analysis.

Undue Influence and Fraud

[37]

The
    motion judge also rejected the appellants argument that the Deed of Gift
    should be set aside on the basis that it had been obtained by way of undue
    influence or fraud.

[38]

In
    oral argument, counsel advised that the appellants no longer seek to rely on
    their position below  rejected by the motion judge  that Shakiba entered into
    the marriage with the fraudulent intention of obtaining a 50% interest in the
    property and as a marriage of convenience in order to obtain permanent
    residency status in Canada. They continue to argue that she obtained the 50%
    interest in the property through the fraudulent intent or undue influence of
    her family, however. To establish undue influence, they rely on the fact that
    Shakibas father advised Rezas parents a few days before the wedding that, if
    the Deed of Gift was not registered, the wedding would not go ahead. During
    oral argument, the submission was made that the alleged false representation
    attributed to Shakibas father (that the property interest would be re-conveyed
    if Shakiba left the marriage) in some way played into the undue influence claim
    as well.

[39]

The
    motion judge rejected the submission that Sima and Hamid had signed the Deed of
    Gift under duress or as a result of undue influence exercised on them by
    Shakiba and her family. There was ample evidence to support this conclusion.

[40]

The
    draft Deed of Gift  clearly indicating that the gift was to be irrevocable and
    containing no indication that it was subject to any terms or conditions  was
    sent to Sima approximately two weeks before the wedding. Both Sima and Hamid
    are sophisticated business people: Sima is a real estate developer and Hamid
    operates a jewellery business in Ottawa. As previously discussed, they had
    legal representation when they were negotiating the terms of the transfer, and
    they both attended at the offices of an independent solicitor, Mr. Nadon, where
    they signed the Deed of Gift and an Acknowledgement stating that they were
    fully advised of the effect of the transfer.

[41]

While
    it is not contested that Shakibas father advised Sima and Hamid that the
    wedding would not go ahead if the Deed of Gift was not registered, that stance
    alone is insufficient to amount to duress or undue influence in the
    circumstances. Nobody complained about it at the time. Sima and Hamid went
    ahead with the registration of the Deed of Gift as outlined above. To amount to
    duress or undue influence, the impugned conduct must result in such a coercion
    of will or pressure on the recipient that he or she has no realistic
    alternative but to submit to it: see
Berdette
, at p. 201. That was not
    the case here.

[42]

Returning
    to the allegedly false representation made by Shakibas father, there is simply
    no evidence in the record that would justify a finding that  assuming the
    representation was made at all  it was made with the fraudulent intent
    necessary to vitiate the transaction. Nor is there any evidence to support the
    suggestion that Sima and Hamid were so coerced or that the representation
    created such pressure that they had no realistic alternative but to agree to
    the Deed of Gift.

[43]

The
    motion judge properly rejected the undue influence argument. I agree and reject
    the appellants submissions on fraudulent intent as well.

Disposition

[44]

For
    all of the foregoing reasons, I would dismiss the appeal.

[45]

Shakiba
    is entitled to her costs of the appeal, fixed in the amount of $9,559.60, all
    inclusive.

Released: December 2, 2015

R.A. Blair J.A.

I agree E.E. Gillese
    J.A.

I agree David Brown
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Amyotrophic Lateral Sclerosis Society of Essex v.

Windsor (City), 2015 ONCA 867

DATE: 20151209

DOCKET: C59525 & C59526

Strathy C.J.O., LaForme and Tulloch JJ.A.

DOCKET: C59525

BETWEEN

Amyotrophic Lateral Sclerosis Society of Essex
    County

Plaintiff (Respondent)

and

The Corporation of the City of Windsor

Defendant (Appellant)

DOCKET: C59526

BETWEEN

Belle River District Minor Hockey Association Inc.
    and

Essex County Dancers
    Incorporated

Plaintiffs (Respondents)

and

The Corporation of the
    Town of Tecumseh

Defendant (Appellant)

Scott Hutchison, for
    appellant City of Windsor

Brendan van Niejenhuis, for
    the appellant Town of Tecumseh

Peter W. Kryworuk and Yola S.
    Ventresca, for the respondents

Heard: By written submissions

On appeal from the orders of the Divisional Court
    (Justices James C. Kent, Clayton Conlan and Michael N. Varpio), dated April 28,
    2014.

ENDORSEMENT RE. COSTS

[1]

Having considered the parties submissions with respect to the costs in
    the Divisional Court, it is our view that the appropriate order is no order as
    to costs in either this court or the Divisional Court.

[2]

This reflects the divided success of the appeal process. It also recognizes
    that it was for the plaintiffs (respondents), not for the defendants
    (appellants) or the court, to produce a rational and workable class definition.
    The plaintiffs definition was arbitrary and, as we noted in our reasons, it
    resulted in common issues that were not common. The failure of the plaintiff to
    address this at the outset, or to amend the class definition when it had
    opportunities to do so, has contributed to the delay in moving this action
    forward and has added to the costs at all levels.

[3]

Order accordingly.

G.R. Strathy C.J.O.

H.S.
    LaForme J.A.

M. Tulloch
    J.A.