COURT OF APPEAL FOR ONTARIO

CITATION: SFC litigation Trust v. Chan, 2018 ONCA 710

DATE: 20180830

DOCKET: M49537 (C65247)

Brown J.A. (Motions Judge)

BETWEEN

Cosimo Borrelli, in his capacity as trustee of
    the SFC Litigation Trust

Moving Party (Respondent)

and

Allen Tak Yuen Chan

Responding Party (Appellant)

Jonathan Bell and William Bortolin, for the moving
    party/respondent

Robert Rueter and Malik Martin, for the responding
    party/appellant

Heard: August 23, 2018

REASONS FOR DECISION

BROWN J.A.:

I.

MOTION TO LIFT THE STAY OF JUDGMENT PENDING APPEAL

[1]

After a 41-day trial, the moving party, Cosimo Borrelli, in his capacity
    as the trustee of the SFC Litigation Trust (the Litigation Trust), obtained a
    judgment against the responding party, Allen Tak Yuen Chan, in the amount of
    $2.904 billion as damages for fraud and breach of fiduciary duty and an
    additional $5 million in punitive damages (the Judgment). Mr. Chan had been
    the Chairman of the Board and Chief Executive Officer of Sino-Forest
    Corporation (Sino-Forest). The extensive March 14, 2018 reasons of Penny J.
    granting the Judgment are reported at 2018 ONSC 1429.

[2]

Mr. Chan resides in Hong Kong. The Litigation Trust has identified
    assets of his in Hong Kong; it has not located any assets of Mr. Chan in
    Ontario.

[3]

On March 28, 2018 the Litigation Trust commenced an action in Hong Kong
    for the recognition and enforcement of the Judgment (the HK Enforcement
    Proceeding).

[4]

Mr. Chan appealed the Judgment to this court by notice of appeal filed
    April 17, 2018. The delivery of the notice of appeal automatically stayed the
    Judgment: r. 63.01(1) of the
Rules of Civil Procedure
.

[5]

Upon the filing of the appeal, the parties agreed to a consent order of
    the Hong Kong court that stayed the HK Enforcement Proceeding. Para. 2 of that
    consent order provided that [u]pon the release of the outcome of the appeal
    against the Canadian Decision or abandonment of the appeal by [Mr. Chan], or
    upon a lifting of the stay that would allow these proceedings to continue
    (regardless of the status of the appeal), parties are at liberty to give a
    21-day written notice to the other side to re-activate these proceedings.

[6]

The Litigation Trust now moves under to r. 63.01(5) for an order
    partially lifting the stay of the Judgment to permit it to continue the HK
    Enforcement Proceeding for the limited purpose of obtaining a domestic Hong
    Kong judgment against Chan on substantially the same terms as the [Judgment].
    Mr. Chan opposes the motion.

II.

GOVERNING PRINCIPLES

[7]

The automatic stay of
an order requiring
    the payment of money (other than support payments)
created by
r. 63.01(1) safeguards the appeal process by
    preserving the appellants access to the money to fund the appeal and continued
    possession of it in the event that the appeal is successful:
Antunes
    v. Limen Structures Ltd.
, 2016 ONCA 61, 85 C.P.C. (7th) 269 at para. 11;
Hall-Chem
    Inc. v. Vulcan Packaging Inc.
(1994)
,
72 O.A.C. 303

(C.A.) at para. 5
.

[8]

Rule 63.01(5) permits a judge of the court to which an appeal is taken
    to order on such terms as are just that the stay arising from r. 63.01(1) does
    not apply. In
Ryan v. Laidlaw Transportation Ltd.
(1994), 19 O.R. (3d)
    547 (C.A.), Austin J.A. described, at pp. 711-712, the perspective a judge
    should bring to a motion to lift a stay pending appeal. He quoted with approval
    the following comments made by Carthy J.A. in
Mortimer v. Cameron,
[1993]
    O.J. No. 4169 (C.A.), at para. 2:

As an initial observation I express the view that motions under
    this rule should be restricted to cases of demonstrable and unusual hardship to
    the respondent, and where a reasonable measure of protection can be afforded to
    the appellants. The reason for the first standard is that the rule provides for
    a stay of money judgments and should be applied in all but unusual
    circumstances. The reason for the second standard is to protect appellants
    against payments which they may not eventually be obligated to make, thus
    putting them to the uncertainties of recovery. In most cases the merits of the
    appeal will have a bearing on these factors.

[9]

Rule 63.01(5) authorizes the lifting of the stay pending appeal on such
    terms as are just. Accordingly, a court should consider the general
    circumstances of the case:
Hall-Chem Inc.
, at para. 6;
Antunes
,
    at para. 13. The court must be flexible and treat each case on its facts:
Stein
    v. Sandwich West (Township)
(1994), 16 O.R. (3d) 321 (C.A.), at p. 323. A
    court must be satisfied that, taking all circumstances into account, it would
    be in the interests of justice to lift the stay.

[10]

Recent
    jurisprudence indicates that a court should have regard to three principal
    factors: (i) the financial hardship to the respondent if the stay is not
    lifted; (ii) the ability of the respondent to repay or provide security for the
    amount paid; and (iii) the merits of the appeal:
SA Horeca Financial
    Services v. Light,
2014 ONCA 811, 123 O.R. (3d) 542 at para. 13;
Antunes
at para. 14.

[11]

While
    the first factor goes to the respondents need, the latter two reduce the risk
    that a successful appellant will be forced to bear the loss, rendering the
    appeal moot. The court may impose this risk on an appellant in an appropriate
    case, but there is no reason to do so absent evidence of significant prejudice
    to the respondent from the stay:
Stein
at p. 323;
Ryan
at pp.
    711-712. Whether the hardship faced by the respondent outweighs any risk to the
    appellant must be determined within the context of the case, including: the
    grounds of appeal, the parties' positions at trial, the trial judges reasons
    and the probable delay before the appeal can be heard:
Antunes
at
    para. 13;
SA Horeca Financial Services
at para. 17.

[12]

The stay has been lifted where a plaintiff is suffering financial
    hardship, particularly in personal injury and family law cases, or has a
    well-founded fear that the appellant is dissipating or divesting assets to
    avoid payment:
Stein
;
Antunes; Peper v. Peper
(1990),

1
    O.R. (3d) 145 (C.A.);
Babbitt v. Paladin Inc.
(1993)
,
20
    C.P.C. (3d) 399 (Ont. C.A.). However, even where such factors are present, the
    plaintiff must satisfy the court that the prejudice of maintaining the stay
    outweighs the risk of subjecting the appellant to the uncertainties of recovery
    if the appeal is successful:
Antunes,
at para. 11;
Ryan,
at
    pp. 711-712;
Stein,
at p. 323.

III.

APPLICATION OF THE governing PRINCIPLES

[13]

The
    Litigation Trust was created as part of Sino-Forests Plan of Compromise and
    Reorganization (the Plan) under the
Companies Creditors Arrangement Act
,
    R.S.C. 1985, c. C-36. Under the Plan, most of Sino-Forests litigation claims
    were transferred to the Litigation Trust, of which Mr. Borrelli was appointed
    trustee.

[14]

On
    this motion, the Litigation Trust concedes that it will not suffer financial
    hardship if the stay is not lifted. Instead, it contends that the stay will
    cause it harm by delaying its efforts to move ahead with the HK Enforcement
    Proceeding.

[15]

The
    Litigation Trust does not point to the scheduling of this appeal as a source of
    delay. Mr. Chan perfected his appeal in mid-July. The Litigation Trust will
    file its responding materials by mid-September. A two-day hearing for the
    appeal has been scheduled for January 14 and 15, 2019. In the result, the
    appeal will be heard within 10 months of the granting of the Judgment.

[16]

Instead,
    the Litigation Trust contends that it will suffer hardship as a result of the
    time it will take to complete the steps required to enforce the Judgment in
    Hong Kong. Mr. Chan has indicated that he will oppose the HK Enforcement
    Proceeding, although he has not disclosed the basis on which he will do so.
    Given his position, the Litigation Trust estimates that it may take up to nine
    months to secure a Hong Kong judgment once it can proceed with the HK Enforcement
    Proceeding. The Litigation Trust seeks to lift the automatic stay so that it
    can start those steps now. If the stay is lifted to permit it to do so, the
    Litigation Trust states that it would be in a position to execute on Mr. Chans
    Hong Kong assets immediately upon the dismissal of his appeal, which it views
    as the inevitable result.

[17]

The
    Litigation Trust submits that lifting the stay to enable it to secure  but not
    enforce  a judgment in Hong Kong would put it in the same enforcement position
    as a plaintiff who had secured an Ontario judgment against a defendant resident
    or with assets in Ontario: it could act at once to enforce the judgment upon the
    dismissal of the appeal.

[18]

I
    am not persuaded, in the specific circumstances of this case, that the
    enforcement delay the Litigation Trust may face amounts to the degree of
    hardship necessary to justify lifting the automatic stay. Several factors lead
    me to this conclusion.

[19]

First,
    the nature of the hardship described by the Litigation Trust  the time it will
    take to enforce an Ontario judgment in a foreign jurisdiction  strikes me
    simply as part of the ordinary cost of conducting the type of business in which
    the Litigation Trust is engaged.

[20]

As
    described by the trial judge, the Litigation Trust is in the business of
    pursuing most of the litigation claims possessed by Sino-Forest at the time of
    the Plans sanction: at para. 73. Pursuing a litigation claim invariably takes some
    period of time. Some defendants reside in the jurisdiction of the domestic
    court; others do not. That simply is a fact of life faced by plaintiffs
    pursuing commercial litigation in a highly inter-connected business and
    investment world. As well, most jurisdictions provide for rights of appeal from
    the decision in first instance. The risk that enforcement of a judgment may be
    postponed because the judgment debtor exercises his right of appeal is an
    ordinary risk of the kind of business carried on by the Litigation Trust.

[21]

Nor
    is this a case where the domestic court cannot move the appeal along with some
    dispatch. Back in 1994, it took this court 18 to 24 months to hear a civil
    appeal once perfected:
Hall-Chem
, at para. 16. In the present case,
    the appeal will be heard six months following perfection.

[22]

Second,
    the ordinary time it takes to secure recognition of a foreign judgment in Hong
    Kong poses no financial risk to the Litigation Trust. The world-wide
Mareva
injunction against Mr. Chan issued by the Ontario Superior Court of Justice has
    been recognized by the Hong Kong courts. The Litigation Trust acknowledges that
    the
Mareva
order is adequate to prevent Mr. Chan from dissipating his
    known remaining assets in Hong Kong.

[23]

Third,
    although the Litigation Trust submits that it is not asking me to assess the
    merits of Mr. Chans appeal, its argument contains a strong the appeal is
    doomed, so lets get on with enforcement of the Judgment flavour. By contrast,
    Mr. Chan submits that it is important to consider the merits of his appeal on
    this motion. He contends his appeal raises important legal issues regarding the
    Litigation Trusts right to pursue the claims asserted in this action, as well
    as important issues of evidence and trial practice.

[24]

A
    motion to lift an automatic stay of judgment in a civil appeal engages  albeit
    it in a different context  the tension between enforceability and
    reviewability interests at play on applications for bail pending appeal. As the
    Supreme Court of Canada observed in
R. v. Oland
, 2017 SCC 17, [2017] 1
    S.C.R. 250, the reviewability analysis on an application for bail pending
    appeal requires a court to examine the grounds identified in the notice of
    appeal with an eye to their general legal plausibility and their foundation in
    the record: at para. 44. To do so, the court must possess an adequate record.
    The following comments made by Moldaver J. in
Oland
, at para. 45,
    apply with equal force to the quality of the record a moving party must place
    before the court on a lift stay motion where the merits of the appeal are
    engaged, either expressly or by implication, in the moving partys submissions:

In the end, appellate judges can be counted on to form their
    own preliminary assessment of the strength of an appeal based upon their
    knowledge and experience. This assessment, it should be emphasized, is not a
    matter of guesswork. It will generally be based on material that counsel have
    provided, including aspects of the record that are pertinent to the grounds of
    appeal raised, along with relevant authorities.

[25]

In
    the present motion, the slim record does not permit an assessment of the merits
    of the appeal. All it allows me to say is that the reasons for judgment of the
    trial judge are long (180 pages) and canvass a number of complex legal and
    factual issues. However, the motion record does not enable me to assess those
    lengthy reasons in light of the record that was before the trial judge.
    Consequently, as a practical matter the merits of the appeal cannot form part
    of the assessment in the present case as to whether the stay should be lifted
    under r. 63.01(5).

[26]

Fourth,
    I see merit in Mr. Chans submission that, on balance, it would be unfair for
    this court to lift the stay to permit additional proceedings to move forward in
    Hong Kong, thereby requiring Mr. Chan to expend resources on both the appeal
    and the HK Enforcement Proceeding. As mentioned, the appeal will be heard in
    six months and during that time the Litigation Trust enjoys the protection
    afforded by the
Mareva
order against Mr. Chan.

[27]

Finally,
    although the Litigation Trust, as plaintiff, does face the task of seeking
    recognition and enforcement of an Ontario judgment in Hong Kong should this
    court dismiss Mr. Chans appeal, the need to do so resulted from the Litigation
    Trusts decision to sue a Hong Kong resident in an Ontario court. As I
    understand the situation, the Litigation Trust is based in Hong Kong and Mr.
    Chan resides in Hong Kong. Had Mr. Chan been sued in Hong Kong, the inevitable
    additional time required to enforce a foreign judgment would not arise.

[28]

I
    do not place much weight on this factor. There may have been quite sound
    reasons for the Litigation Trust to sue Mr. Chan in Ontario. However, the
    motion materials do not assist me in understanding why suit was brought in
    Ontario instead of Hong Kong. I simply observe that what the Litigation Trust
    describes as the hardship associated with this appeal flows from its choice of
    forum.

[29]

Taking
    all these factors into account, I conclude that it would not be in the
    interests of justice to lift the stay of the Judgment to allow the Litigation
    Trust to continue the HK Enforcement Proceeding to the point of obtaining an
    order recognizing and enforcing the Judgment against Mr. Chan.

IV.

DISPOSITION

[30]

For
    these reasons, I dismiss the Litigation Trusts motion.

[31]

Mr.
    Chan seeks partial indemnity costs of the motion in the amount of $9,000. The
    Litigation Trust submits the costs should be left to the panel hearing the
    appeal and, in any event, should not exceed $5,000.

[32]

I
    will not defer the costs of this motion to the panel. The main reason for not
    doing so lies in the protection the continuing
Mareva
order provides
    to the Litigation Trust against the risk of Mr. Chan dissipating his assets
    pending the hearing of the appeal. The existence of that order lessened the
    need to bring this motion to lift the stay.

[33]

I
    award Mr. Chan costs of this motion fixed at $5,000, inclusive of disbursements
    and all applicable taxes, payable by September 10, 2018.

David Brown J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Shinder v. Shinder, 2018 ONCA 717

DATE: 20180831

DOCKET: C64169, C64727 and C64793

Pepall, Hourigan and Brown JJ.A.

BETWEEN

Randi Joy Cogan Shinder

Applicant (Respondent)

and

Neil Allen Shinder

Respondent (Appellant)

and

Solomon Shinder

Respondent (Appellant)

Harold Niman and Vanessa Amyot, for the appellant Neil Allen
    Shinder

Stephen Grant and Erin Crawford, for the appellant
    Solomon Shinder

Jaret Moldaver and Lindsay Konkol, for the respondent

Heard: January 25, 2018

On appeal from the order of Justice Janet Wilson of the Superior
    Court of Justice, dated July 13, 2017, with reasons reported at 2017 ONSC 4177,
    and from the costs order, dated August 1, 2017.

Pepall

J.A.:

INTRODUCTION

[1]

Neil and Randi Shinder were married on July 28,
    1996 and have two children, ages 21 and 20.  The couple separated on September
    9, 2009.  They entered into a Separation Agreement on June 25, 2012 and
    subsequent Minutes of Settlement varying that Agreement on February 27, 2014.

[2]

In 2016, Randi commenced proceedings against
    Neil and Neils father, Solomon (Sol), seeking, among other things, an order
    to set aside the Separation Agreement and the Minutes of Settlement.   She
    asserted that, when she entered into the Separation Agreement and the Minutes
    of Settlement, she was aware that Sol had established the Solomon and Zelaine
[1]
Shinder Canadian Grandchildren
    Family Trust (the Trust) but did not know that Neil was a beneficiary.  She
    asserted that his interest had not been disclosed.

[3]

Neil and Sol brought motions for summary
    judgment to dismiss Randis application.  The motions judge dismissed Neils
    motion for summary judgment, granted Sol partial summary judgment (insofar as
    he was not required to produce an Affidavit of Documents), and, although not
    requested, granted partial summary judgment in Randis favour on two issues.
    First, the motions judge found that Neil deliberately failed to disclose his
    interest in the Trust to Randi.  Second, she found that Randi did not know of Neils
    interest in the Trust prior to entering into the Separation Agreement and the
    Minutes of Settlement, and as such, Neils defence that Randi knew of his
    interest could not succeed.

[4]

Neil and Sol appeal from this order.  For the
    reasons that follow, I would allow Neils appeal, with the exception of paragraph
    7 of the order below, which remains in effect, and which remits certain issues
    to mediation/arbitration as the parties agreed.  I would also allow Sols appeal.

FACTUAL BACKGROUND

[5]

At their date of marriage in 1996, Neil held 48
    common shares in Coofer Holdings Inc. (Coofer), a company controlled by Sol. Two
    years prior to the couples separation, Sol reorganized his holdings, including
    his shares in Coofer, initiated an estate freeze, and, with the consent of his
    two sons, established separate trusts (one Canadian and one American) for each
    of his sons families.  As found by the motions judge, Sols stated intention
    was to pass the benefit of future growth in his estate to his five
    grandchildren, including Randi and Neils two children.  The Canadian Trust
    holds common shares of Coofer.  As a result of this estate freeze, on January
    1, 2008, in exchange for the surrender of his common shares in Coofer, Neil
    received preference shares in Coofer having a fixed value of $1,106,784 with no
    voting rights and with dividends payable at the discretion of the Board of
    Directors.

[6]

While they were married, Randi and Neil
    developed companies that marketed and distributed beauty products.  Randi
    handled the creative component of the business including product development
    and marketing, and Neil handled the day-to-day operations and finances of the
    businesses.  The companies were very successful, and by the parties
    separation, they were worth tens of millions of dollars.

[7]

On separation, Randi and Neil proceeded to
    negotiate the terms governing the demise of their marriage.  Their financial
    affairs were complex, and they held significant assets.  Indeed, two years
    prior to their separation, they had sold one of their corporations for
    approximately $80 million.  Based on his income tax return for the year 2009,
    Neil had gross annual income in excess of $14 million, as did Randi.  Each of
    them retained experienced counsel and accountants to assist in identifying, evaluating,
    and dividing their holdings.

[8]

Randi commenced proceedings against Neil on
    December 7, 2010.  Among other things, she requested an unequal division of the
    parties net family property.  In her application, Randi noted that Neil had an
    interest in various entities including Coofer.  She stated that Coofer had
    undergone a reorganization; new shares had been issued; and [v]irtually no
    information has been provided about this reorganization.  She requested full
    and complete disclosure.

[9]

The parties exchanged Financial Statements.  Although
    he listed his share interest in Coofer and that he was a beneficiary of an
    entirely different Shinder Family Trust, Neil did not list his additional interest
    as a beneficiary under the Trust in his sworn Financial Statements, dated April
    5, 2011 and November 22, 2011.  He identified excluded property as having a nil
    value.  In his November 22, 2011 Financial Statement, he identified the
    $1,106,784 redemption value of the preferred shares in Coofer, noting that no
    dividends were expected to be paid.

[10]

On April 8, 2011, Randi and Neil consented to an
    order addressing disclosure and questioning at a Case Conference conducted by
    Herman J.  Neil was ordered to provide a disclosure request to Randi by April
    29, 2011; Randi was ordered to provide any additional disclosure requests to
    Neil by April 15, 2011; Neil was ordered to reply by May 15, 2011; and Randi
    was ordered to reply by May 30, 2011.  In addition, leave for questioning was
    granted.

[11]

Pursuant to that order, on April 14, 2011, Randis
    counsel, Annie Noa Kenet of the law firm Goldhart & Associates, wrote to Neils
    counsel, Harold Niman and Daryl Gelgoot, and requested itemized information identified
    by Andrew Freedman of Duff & Phelps, the accountant retained on behalf of
    Randi.

[12]

There were 131 items listed and numerous
    headings in the letter.  Among other things, Ms. Kenet sought rent rolls for
    certain properties at the date immediately preceding Coofers reorganization,
    at the date of separation, and currently.  Ms. Kenet also sought information on
    the Trust.

[13]

By letter dated May 13, 2011, Neils valuator,
    Linda Brent of Brent Valuations Inc., responded to the information identified by
    Mr. Freedman.  Her 23 pages of answers together with enclosures were forwarded
    to Mr. Gelgoot. The enclosures referred to in the responses were contained on
    an attached CD and were also listed on an accompanying index.  Ms. Brent wrote
    that, if Mr. Gelgoot had any questions, he should not hesitate to contact her.

[14]

Ms. Brent responded that the request for rent
    rolls before reorganization and currently was not relevant.  Further
    consideration would be given to the request if particulars of the purpose and
    its relevancy were provided.  Furthermore, the information was not in Neils
    possession but had been requested from Sol who had refused to provide it for reasons
    of confidentiality relating to the interests of third parties from whom consent
    was required.  As for the information as of the date of separation, Ms. Brent
    noted that Neil held fixed value preference shares and since his contingent
    interest in the Trust was received as a gift during marriage and was excluded
    property, the request was not relevant.  She reiterated that further
    consideration would be given to the request if particulars of the purpose and
    relevancy were provided and repeated the problem relating to Sol,
    confidentiality, and the need for third party consent.  Essentially the same
    answer was given in response to Ms. Kenets request for the fair market value
    of marketable securities held by Coofer.

[15]

Under the heading S&Z Canadian
    Grandchildren Family Trust, the following items were requested by Randis
    advisors: the Trust indenture; Trust returns for 2007, 2008, 2009, and 2010; financial
    statements for 2007, 2008, 2009, and 2010; and the ages and names of Sol and
    Zelaines grandchildren.

[16]

Ms. Brent identified and enclosed the Trust
    indenture for the S&Z Canadian Grandchildren Family Trust, dated December
    4, 2007.  The Trust indenture described Neil as an Original Trustee, along with
    Sol and Zelaine.  Both Neil and Randi were also described as beneficiaries,
    although Randi was a beneficiary only while she and Neil lived together in a
    conjugal relationship:

1.(c) beneficiary means the person or
    persons who are entitled to any benefit hereunder whether such benefit is
    contingent or absolute or whether such benefit is a right to receive income or
    capital or is an interest in income or capital of the trust fund, and without
    limiting the generality of the foregoing, shall include SOLOMON SHINDER,
    ZELAINE SHINDER, NEIL SHINDER, RANDI SHINDER and the children of NEIL SHINDER;

(i) provided that ZELAINE SHINDER shall
    only be a beneficiary of this Trust upon the death of her husband, SOLOMON
    SHINDER;

(ii) and provided that the spouse of NEIL
    SHINDER shall only be a beneficiary of this Trust while she and NEIL SHINDER
    live together in a conjugal relationship[.]

In addition, the Trust Indenture
    provided that any beneficiarys interest in the Trust property or its interest
    was excluded property for family law purposes:

22. The Interest of any beneficiary in any
    property of the Trust, any income from property of the Trust, any accretion in
    value of property of the Trust and any property into which the above mentioned
    property can be traced, including any income from the traced property, shall
    constitute his or her exclusive property and
shall be excluded from his or
    her net family property
, as such term is defined in the
Family Law Act
,
    R.S.O. 1990, c.F.3 as amended, and shall not form part of any present or
    deferred community of property or value shareable with his or her spouse under
    the laws of any jurisdiction. [Emphasis added.]

[17]

In response to the request for production of the
    Trust returns, Ms. Brent responded that no tax returns had been filed, but she
    enclosed an exemption for fiscal years 2009 and 2010.  She stated that no
    financial statements had been prepared for the years 2007 to 2010.  She
    provided the ages and names of the children of Neil and Randi but stated that
    those of the other grandchildren were not relevant.

[18]

As mentioned, in her letter, Ms. Brent also
    described Neils interest in the trust as contingent and as excluded
    property.

[19]

In her cross-examination for the purposes of the
    summary judgment motion, Randi stated that she did not read Ms. Brents letter.

[20]

In his Affidavit sworn June 17, 2011, Neil
    repeated some of Ms. Brents responses and stated that his contingent interest
    in the Trust was received as a gift during marriage, was excluded property, and
    therefore not relevant.

[21]

In an Affidavit sworn by Sol on August 3, 2011,
    he attached a corporate chart listing Neil as one of the beneficiaries of the
    Trust.  He also stated that the ultimate residual beneficiaries of the Trust
    were Neil and Randis children.

[22]

Randis lawyers and Mr. Freedman did not pose
    any follow-up questions on the Trust.  Nor did anyone else on Randis behalf.

[23]

Neil and Sol agreed to produce documentation on
    Coofer but, before doing so, asked that Randi sign a confidentiality
    agreement.  She refused to do so.  Ultimately, as mentioned, on June 25, 2012,
    the parties entered into a Separation Agreement.  It provided that Randi and
    Neil had each investigated the others financial circumstances to his or her
    satisfaction.  They subsequently varied their Agreement and entered into
    Minutes of Settlement, dated February 27, 2014, following a mediation before
    Alfred Mamo.

[24]

On September 1, 2016, Randi commenced
    proceedings against Neil and Sol. Among other things, she sought an order setting
    aside the Separation Agreement and the Minutes of Settlement. She asserted that
    Neil had failed to truthfully disclose his assets.  If the Separation Agreement
    and the Minutes of Settlement were not set aside, or in any event, Randi
    claimed damages for conspiracy to commit fraud, deceit, and punitive damages of
    $250,000.  As revealed by her Amended Application, the factual basis for these three
    claims mirrored her claim that the two agreements be set aside for
    non-disclosure. Both parties and the motions judge approached the summary
    judgment motions on the basis of non-disclosure.

[25]

In her Amended Application, Randi also sought
    other relief including damages for various breaches of the Settlement Agreement
    and the Minutes of Settlement relating to removal of certain household
    contents, child support, section 7 expenses, RESPs and Bonds in favour of the
    two children of the marriage, failure to share tax benefits, and damages for
    conversion relating to household contents.

MOTIONS JUDGES DECISION

[26]

On the summary judgment motions brought by Neil
    and Sol, the motions judge identified the only issue for consideration as being
    whether there was a triable issue that Neil had failed to disclose that he was
    a beneficiary of the Trust.  She noted that, under s. 56(4)(a) of the
Family
    Law Act
, R.S.O. 1990, c. F.3, the court may set aside a domestic contract
    if a party has failed to disclose to the other significant assets existing when
    the domestic contract was made.  She went on to emphasize the need to make
    disclosure and stressed that accurate and complete Financial Statements are
    crucially important and particularly so in complex cases.  She found that Neil
    had failed to disclose his interest in the Trust in his Financial Statements.
    She was unable to determine from the evidence before her whether Randis
    counsel, accountant or advisors were aware of the terms of the Trust.  However,
    relying on
Virc v. Blair
, 2014 ONCA 392, 119 O.R. (3d) 721, she
    determined that there had been non-disclosure, and Neil and Sol had failed to
    show that Randi knew of Neils interest in the Trust.

[27]

The motions judge went on to conclude that it
    was unnecessary to have a trial on the issue of non-disclosure.  She dismissed
    Neils motion for summary judgment and granted Randi partial summary judgment
    on two issues: (i) that Neil had deliberately failed to disclose his interest
    in the Trust to Randi; and (ii) that Randi did not have actual knowledge of the
    non-disclosure when she entered into the June 25, 2012 Separation Agreement.
    Neils attempt to defend the action on the grounds of Randis knowledge could
    not succeed.  The motions judge left for further hearing, following full
    disclosure by Neil, whether Neils failure to disclose that he was a
    beneficiary of the Trust was material or significant non-disclosure within the
    meaning of s. 56 of the
Family Law Act
.  In addition, Neil was to file
    a sworn Financial Statement, and he was to answer refusals arising from his
    cross-examination and produce the documents requested by Randi.  The motions
    judge also ordered that unless the Separation Agreement was set aside on the
    ground of non-disclosure, all of the other issues raised (section 7 expenses,
    child support, contents, and any other alleged breaches related to the failure
    to share tax benefits, etc.) were to be dealt with by the mediation/arbitration
    process stipulated in the Separation Agreement.

[28]

As for Sols request for summary judgment, the
    motions judge found that, although he was aware that Neil was a beneficiary of
    the Trust, Sol had failed to squarely reveal the truth.  In his Affidavit, Sol
    had stated that the ultimate residual beneficiaries of the Trust were Neil and
    Randis children.  He had attached a corporate chart that showed Neil and Randi
    as Trust beneficiaries, but the motions judge stated that it was in fine print
    and barely legible.

[29]

The motions judge did not expressly dismiss
    Sols motion for summary judgment and such a dismissal is not found in the
    order.  It would appear that the motions judge implicitly dismissed his
    motion.  She also ordered Sol to answer refusals from his cross-examination and
    to produce the documents requested by Randi.  The motions judge dismissed
    Randis request for Sol to file an Affidavit of Documents with respect to
    assets owned by Neil at marriage and separation.

[30]

The motions judge invited the parties to bring a
    motion before her to address any objections about the scope of disclosure
    relating to the refusals.  Both Neil and Sol brought motions, and the motions
    judge made a further order clarifying and amplifying the scope of the
    information to be provided.

[31]

The motions judge subsequently ordered Neil and
    Sol to pay Randis costs fixed in the amount of $70,000, 75% to be paid by Neil
    and 25% to be paid by Sol.

APPEAL PROCEEDINGS

[32]

Both Neil and Sol sought to appeal from the
    motions judges July 13, 2017 order and her order on costs.  Leave to appeal
    was requested of the Divisional Court, and Notices of Appeal were also filed in
    the Court of Appeal.

[33]

The Divisional Court granted leave to appeal
    from paragraph 1 of the July 13, 2017 order (dismissing Neils summary judgment
    motion); paragraph 3 (requiring him to file a Financial Statement); and
    paragraph 4 (requiring him to answer refusals from his cross-examination).  The
    Divisional Court would have granted leave to appeal paragraphs 2 (granting
    Randi partial summary judgment on the issues of Neils non-disclosure and
    Randis lack of actual knowledge) and 7 (on sending all of the other issues
    raised to mediation/arbitration as provided for under s. 6 of the Separation
    Agreement in the Dispute Resolution section) but for the fact that they were
    final in nature.  The Divisional Court also granted leave to appeal the costs
    order of August 1, 2017.

[34]

On consent, Hourigan J.A. consolidated Neil and
    Sols Divisional Court appeals with Neils appeal in the Court of Appeal.

[35]

On appeal, the appellants did not press the motions
    judges referral of all other issues to a mediator/arbitrator (Alfred Mamo) in
    either their factums or oral argument and no cross-appeal is taken with respect
    to that aspect of the motions judges decision.

ISSUES

[36]

On appeal, in essence, Neil raises three
    issues.

[37]

First, he submits that the motions judge made
    palpable and overriding factual errors in finding that he intentionally failed
    to disclose his interest in the Trust when the Separation Agreement and Minutes
    of Settlement were being negotiated, in finding that Randi had no knowledge of
    his interest in the Trust prior to entering into the Separation Agreement, and
    in granting partial summary judgment to that effect in Randis favour.  Second,
    he argues that the motions judge erred in law in dismissing his motion for
    summary judgment.  Third, he submits that the motions judge erred in awarding
    Randi costs of the motions in the sum of $70,000 against Neil and Sol.

[38]

For his part, Sol raises four issues on appeal.

[39]

Sol submits first that the motions judge erred
    in granting partial summary judgment in Randis favour and in dismissing his motion
    for summary judgment on the basis that the motions judge failed to consider the
    relevant law in determining the validity of Randis claims against him; second
    that
s
he erred in finding that Neil (and Sol) had intentionally failed
    to disclose his interest in the Trust; and third that
s
he erred in awarding
    costs to Randi.  Fourth, he takes issue with the motions judges order that he
    provide answers to refusals from his cross-examination and make production of
    documents.

ANALYSIS

[40]

Section 56(4) of the
Family Law Act
permits a court, on
    application, to set aside a domestic contract or a provision in it,

(a)

if
    a party failed to disclose to the other significant assets, or significant
    debts or other liabilities, existing when the domestic contract was made;

(b)

if
    a party did not understand the nature or consequences of the domestic contract;
    or

(c)

otherwise
    in accordance with the law of contract.

[41]

A domestic contract includes a separation
    agreement.

[42]

Section 56(4)(a) permits but does not require a
    court to set aside a domestic contract.  Put differently, the courts inquiry does
    not end with a finding of failure to disclose significant assets or debts.
    Rather, the court must also consider whether it is appropriate to exercise its
    discretion in favour of setting aside the agreement:
LeVan v. LeVan
, 2008
    ONCA 388, 90 O.R. (3d) 1, at para. 51.  As with all matters of statutory
    interpretation, provisions should be interpreted in a way that accords with the
    objectives of the Act.

[43]

As stated in its preamble, the objectives of the
    Act include providing for the orderly and equitable settlement of the affairs
    of the spouses upon the breakdown of the partnership.

[44]

The primary issue in this case, as framed by the
    parties and the motions judge, is whether, despite the omission in the sworn
    Financial Statements, Neils interest in the Trust was nonetheless disclosed.  Second,
    did Randi have knowledge of Neils interest in the Trust; and third, in any
    event, was Neils interest in the Trust significant?

(a)

Neils Grounds of Appeal

(i)

Disclosure and Randis Knowledge

[45]

Neils interest in the Trust as a named
    beneficiary  and not just the shares in his own name that he did disclose should
    have been listed on his sworn April 5 and November 22, 2011 Financial
    Statements.  That is, while he did disclose both his common and preference
    shares in Coofer in both the April and November financial statements as well as
    income received from that company and from Esbak  another of his fathers
    companies  he should have included his interest as a named beneficiary under the
    Trust under the heading of
excluded
property.

[46]

The parties exchanged financial statements and
    then consented to an April 8, 2011 court order that governed their mutual
    disclosure responsibilities.  It was implicit from this order that further
    disclosure was anticipated.  Indeed, what followed was an exchange of
    correspondence and requests for further disclosure between the parties counsel
    and their financial advisors that encompassed details about the Trust.

[47]

As mentioned, in her May 13, 2011 letter, Ms.
    Brent responded to the correspondence sent by Randis lawyers and the questions
    asked by Randis accountant.  She provided the Trust indenture to counsel for Randi.
    It described the nature of Neils interest in the Trust as did Ms. Brent.  She
    described his interest as both contingent and excluded.  She confirmed that no
    tax returns had been filed and that no financial statements had been prepared
    and provided the names and ages of Neil and Randis children.

[48]

In the face of this disclosure, the motions
    judge's findings cannot withstand scrutiny. Moreover, and significantly,
    the motions judge erred in her analysis of Randis knowledge of the Trust.

[49]

The motions judge concluded that Randi was
    unaware that Neil was a named beneficiary of the Trust and stated,
at para. 133, that [i]n these circumstances, it is
    not necessary to review what her counsel or accountant did or did not know.

[50]

This was in error.  The general rule is that, in
    the ordinary case, the knowledge of an agent is imputed to its principal, there
    being a presumption that an agent will communicate his knowledge to the
    principal because it is his duty to do so:
Vescio v. Peterman
(1999),
    45 O.R. (3d) 613 (C.A.), at para. 2, citing
Durbin v. Monserat Investments
    Ltd
.
(1978), 87 D.L.R. (3d) 593 (Ont. C.A.), at p.
    595.    As in
Vescio
, this rule also applies to imputing knowledge of
    a solicitor to his or her client. As Rowe J.A. (as he then was) stated in
Acharya
    Holdings Ltd. v. Standard Trust Co.
, 2014 NLCA 13, 346 Nfld. &
    P.E.I.R. 348, leave to appeal refused [2014] S.C.C.A. No. 187, at para. 16:

It is a settled principle of law that the
    knowledge of the solicitor is imputed to his or her client:
Rolland v. Hart
(1871), L.R. 6 Ch. App. 678 (Eng. L.C.), at 681-82. (See also:
Stoimenov v.
    Stoimenov
(1985), 50 O.R. (2d) 1 (Ont. C.A.). at paragraph 11;
Beechwood
    Cemetery Co. v. Graham
(1998), 117 O.A.C. 59 (Ont. C.A.), at paragraph 53.)

[51]

The Court of Appeals decision in
Anderson
    v. McWatt
, 2016 ONCA 55, relied upon by Randi, in no way detracts from
    this principle.  Instead, that was a case where the wifes counsel was found
    not to have knowledge of an asset that the husband fraudulently asserted was
    not in his name.  The Court of Appeal merely confirmed that the statement made
    by the wifes counsel in a letter that the wife may have a claim against the
    property, depending on what emerged in the examination of the husband, did not
    amount to knowledge that the husband in fact owned the property in question.

[52]

It was a palpable and overriding error for the
    motions judge to state that she was unable to determine whether Randis
    counsel, accountant or advisors were aware of the terms of the Trust.  There can
    be no real issue that disclosure was made to Randis counsel and financial advisor;
    indeed among other things, they were given the Trust indenture that clearly
    identified Neil as a Trust beneficiary, financial statements for Coofer for the
    years preceding the couples separation, and a Coofer valuation report prepared
    to effect the estate freeze and to value Neils shares in Coofer.  Furthermore,
    this was not disclosure that was in any way buried.  The Trust was specifically
    mentioned in correspondence between counsel and the financial advisors.  Randi
    was deemed to have knowledge as a result of the knowledge of her counsel.

[53]

In resolving their financial issues arising from
    marital breakdown, these parties received advice from highly experienced
    advisors.  With the benefit of that advice, they settled their affairs. In
    their separation agreement, both Randi and Neil stated that each had
    investigated the others financial circumstances to his or her satisfaction.
    They consented to an order governing the process, and through her counsel and
    financial advisors, Randi is deemed to have had knowledge of Neils interest in
    the Trust.

[54]

Neils omission of his interest in the Trust in
    his November, 2011 Financial Statement does not alter these facts.  Although he
    ought to have included this interest in that portion of the Financial Statement
    that addresses excluded property, its omission cannot serve to turn actual
    disclosure and Randis knowledge into non-disclosure for the purposes of
    s.56(4) of the
Family Law Act
.

[55]

Lastly, the motions judges reliance on
Virc
    v. Blair
was misplaced.  That case involved undisputedly significant
    non-disclosure. This is not that case.

[56]

It follows that the motions judge erred in
    granting partial summary judgment to Randi.  I would set aside paragraphs 2 and
    3 of the motions judges order of July 13, 2017.

(ii)

Significance of the Asset

[57]

Even if the omission from the Financial
    Statements could be characterized as non-disclosure, s. 56(4) also requires the
    court to consider whether the implicated asset is significant.  The motions
    judge did not engage in this part of the analysis.  Instead, she deferred the
    issue to be addressed in the future without considering whether there was a
    genuine interest requiring trial.

[58]

Here, there was not a genuine issue requiring a
    trial.  Section 4(2) of the
Family Law Act
excludes from net family
    property, and therefore from equalization, any property acquired by gift or
    inheritance from a third person after the date of the marriage. The Trust
    comprised Sols property and Neils common shares in Coofer that had originally
    been given to him by Sol and then exchanged for preference shares that were
    disclosed to Randi and included in both of Neils Financial Statements.  In the
    face of the disclosure of these Coofer shares, any additional benefits Neil
    might receive under the Trust would constitute a gift or inheritance acquired
    after the date of the marriage and hence would have to constitute excluded
    property as defined under the
Family Law Act
.  Although not
    determinative, this is consistent with s. 22 of the Trust Indenture, which
    declares any benefit received by any beneficiary under the Trust to be excluded
    property for family law purposes.  Ms. Brent responded to the questions posed
    by Randis advisors and also noted that Neils interest in the Trust would have
    to constitute excluded property.  One may reasonably conclude that this factor
    informed the decision made on Randis behalf to forego further questioning on
    the Trust despite Ms. Brents invitation for particulars on the purpose and
    relevancy of the request.

(iii)

Neils Motion for
Summary
Judgment and the Interlocutory Provisions of the Order Below

[59]

Neil also asserts that the motions judge erred
    in refusing to grant his motion for summary judgment.  In his notice of motion seeking
    summary judgment, Neil had requested that Randis Application be dismissed in
    its entirety.

[60]

Given the process and Randis knowledge, there
    is no genuine issue requiring a trial on the issue of non-disclosure.  It
    follows that there could be no genuine issue requiring a trial for damages for
    conspiracy to commit fraud, deceit or punitive damages, all of which rely on
    the same constellation of facts as set out in Randis Amended Application. I
    would grant Neils request for summary judgment in this regard.  As such, I
    would dismiss the claims asserted in paragraphs 1, 2, 11, 12, and 13 of Randis
    Amended Application.

[61]

As for the other issues raised by Randi, the
    motions judge stated, at para. 7 of her order:

Unless the Separation Agreement is set aside
    in its entirety on the narrow ground of the non-disclosure of Neils interest
    in the Trust, all of the other issues raised (section 7 expenses, child
    support, contents, and any other alleged breaches related to failure to share
    tax benefits, etc.) shall be dealt with by the Mediation/Arbitration process
    stipulated in the Separation Agreement.

[62]

I see no reason to interfere with this
    disposition.  The Separation Agreement remains in force as do the Minutes of Settlement.
     All other outstanding issues should be resolved by the s. 6 mediation/arbitration
    process in the Separation Agreement and s.20 of the Minutes of Settlement.

[63]

I would also allow Neils appeal from the
    interlocutory provisions, at para. 4, of the order under appeal.  They derive
    from Randis claim that the Separation Agreement and Minutes of Settlement be
    set aside on the basis of non-disclosure, which cannot succeed.  Thus, they
    have no further relevance.

(iv)

Costs

[64]

Neil asks that the costs award of $70,000 in
    Randis favour be set aside, and that the costs below and of the appeal be
    awarded to him instead.  Generally, in family and other civil proceedings,
    costs follow the event.  Certainly, Neil should be entitled to his costs of the
    appeal and the Divisional Court proceedings.

[65]

I would, therefore, order those costs to be paid
    by Randi to Neil fixed in the amount of $30,000 on a partial indemnity scale,
    inclusive of disbursements and applicable tax.

[66]

As for costs below, I would set aside the order
    for $70,000 in favour of Randi, and order Neil and Randi to bear their own costs
    of those proceedings.  Although Neil was successful, given the omissions in his
    2011 Financial Statements, it is fair and reasonable that Neil bear some of the
    burden for the proceedings.

(b)

Sols Grounds of Appeal

[67]

As mentioned, Sol submits that the motions judge
    erred (i) in granting partial summary judgment in Randis favour and failing to
    grant summary judgment in his favour because the motions judge did not apply
    the relevant law to his motion for summary judgment; (ii) in finding that Neil intentionally
    failed to disclose his interest in the Trust; and (iii) in ordering costs of
    the motion in the amount of $70,000 against Sol and Neil.   As mentioned, he
    also appeals the interlocutory provisions of the motions judges order.

[68]

Since the second ground of appeal overlaps with
    Neils and has already been addressed, I will only discuss the other three
    grounds.

[69]

I agree with Sol that the motions judge erred in
    her treatment of his motion for summary judgment.

[70]

The motions judge did not consider the requisite
    tests to establish the claims asserted against Sol: conspiracy to commit fraud,
    deceit, and punitive damages. If she had, it would have been clear that these
    tests could not be met based on the record before her and that there was no
    genuine issue requiring a trial.

[71]

On a motion for summary judgment, each party has
    to put their best foot forward in relation to any material issues to be tried:
Sanzone v. Schechter
, 2016 ONCA 566, 402 D.L.R. (4th) 135, at para.
    32.
Here, Randi did not adduce evidence that would support the requisite elements of
    the causes of action and claims asserted against Sol.
On
    the conspiracy to commit fraud claim, there simply is no evidence to sustain
    the requirement that the course of conduct adopted by Sol had the predominant
    purpose of causing injury to Randi or that his conduct was unlawful, directed
    towards Randi, and in circumstances where he should have known that injury to
    her would likely result.  See:
Cement Lafarge v. B.C. Lightweight Aggregate
,
[1983] 1 S.C.R. 452.  Sols intention, as found by the motions judge, was to
    implement an estate freeze to organize his corporate and personal affairs to pass
    on the benefit of future growth to his grandchildren.  He effected the freeze
    two years before Randi and Neil separated and initially, she too was a
    beneficiary.  Moreover, no injury ensued. Similarly, with the claim of deceit,
    this claim cannot be sustained.  I have already concluded that Neils interest
    in the Trust was disclosed.  In the light of this conclusion, a finding of
    deceit could not be grounded in Sols statement that the ultimate beneficiaries
    were Neil and Randis children coupled with the corporate chart that disclosed
    Neils interest. Lastly, again there is no evidence to support Randis claim of
    punitive damages.  No finding could be made that Sols conduct was malicious,
    oppressive and high-handed such that it offends the courts sense of
    decency:
Whiten v. Pilot Insurance Co
.
, 2002 SCC 18, at para.
    36.

[72]

It follows that Sols motion for summary
    judgment should have been granted.  Given this outcome, I would also allow
    Sols appeal from the interlocutory provisions of the order.

DISPOSITION

[73]

For these reasons, I would allow Neils appeal
    in part.  That is, paragraph 7 of the underlying order shall remain in effect
    to the extent that it permits Randi to pursue the other issues she raises (as
    described by the motions judge, section 7 expenses, child support, contents, as
    well as any other alleged breaches related to a failure to share tax benefits,
    etc.) through the mediation/arbitration process stipulated in the Separation
    Agreement.  I would set aside the partial summary judgment in favour of Randi, dismiss
    Randis claim that the Separation Agreement and Minutes of Settlement be set
    aside on the basis of non-disclosure of Neils interest in the Trust, and set
    aside the costs order below.  I would order Neil and Randi to bear their own
    costs of the proceedings below and would order Randi to pay Neils costs of the
    appeal, including the Divisional Court proceedings, on a partial indemnity
    scale fixed in the amount of $30,000, inclusive of disbursements and applicable
    tax.

[74]

I would allow Sols appeal.  I would order Randi
    to pay $20,000 in costs of the proceedings below.  In addition, she is to pay costs
    of the appeal, including the Divisional Court proceedings, on a partial
    indemnity scale fixed in the amount of $20,000, inclusive of disbursements and
    applicable tax.  Although fraud was pleaded, it played a minimal role in the
    argument and analysis, and I am satisfied that a partial indemnity costs award
    is fair and reasonable in the circumstances.

Released: DMB AUG 31 2018

S.E. Pepall J.A.

I agree. C.W. Hourigan
    J.A.

I agree. David Brown
    J.A.

[1]

Sols wife.


COURT OF APPEAL
    FOR ONTARIO

CITATION: Shaun Developments Inc. v. Shamsipour, 2018 ONCA
    707

DATE: 20180829

DOCKET: C65010

Lauwers, Miller and Nordheimer JJ.A.

BETWEEN

Shaun Developments Inc.

Plaintiff (Respondent)

and

Ali Reza Shamsipour,
    Mohsen Zadegan and Mansour Shamsipour

Defendants (Appellants)

David Taub and Ellad Gersh, for the appellants

Michael Kestenberg and Thomas Slahta, for the respondent

Heard: August 27, 2018

On appeal from the judgment of Justice Peter Cavanagh of
    the Superior Court of Justice, dated January 18, 2018, with reasons reported at
    2018 ONSC 440.

REASONS FOR DECISION

[1]

The defendants appeal from the judgment of the motion judge who dismissed
    the defendants motion for summary judgment to dismiss the plaintiffs action but
    granted the plaintiffs motion for summary judgment for a declaration that
    three agreements of purchase and sale between the parties were valid and
    enforceable. At the conclusion of the hearing, we dismissed the appeal with
    reasons to follow. We now provide those reasons.

[2]

This case concerns three inter-connected agreements of purchase and sale
    (the Agreements), that were made between the respondent, as purchaser, and
    one of each of the appellants, as vendors, in respect of three contiguous properties,
    all located in the City of Toronto.

[3]

The Agreements were conditional upon the respondent receiving in writing
    the "final, unappealable and official Order" made by the Ontario
    Municipal Board ("OMB") granting an appeal heard on August 26, 2015
    (the "OMB Appeal") and approving a proposed development of the three
    properties, defined in the Agreements as the "OMB Decision". This
    condition was contained in the section of the Agreements entitled "OMB
    Condition.

[4]

Handwritten changes were made to the Agreements that required the
    respondent to either deliver notice in writing that the OMB Condition was
    fulfilled, or to waive the OMB Condition, within 7 days of the
    "verdict" (the term used in two of the Agreements) or the official
    verdict (the term used in the third Agreement). The terms "verdict"
    and "official verdict" were not defined in the Agreements.

[5]

The OMB released its decision on March 15, 2016, in which it granted the
    appeal and approved the proposed development. The formal Order was withheld
    pending completion of both the site plan process and approval of the form of zoning
    by-law amendment by the City Solicitor.

[6]

Thereafter, the City of Toronto requested a reconsideration of that
    approval which was dismissed by the Board in written reasons issued on June 28,
    2016 (the "OMB Dismissal").

[7]

The parties agree that the "OMB Decision", within the meaning
    of the Agreements, was not issued because there was not, as yet, a final,
    unappealable and official Order.

[8]

The issue on appeal is the correct interpretation of the handwritten terms
    "verdict" and "official verdict" in the Agreements, more
    specifically, whether those terms have the same meaning as the defined term OMB
    Decision. If the meaning is the same, then this appeal must fail and the
    motion judges conclusion that the Agreements are valid and enforceable is to
    be upheld. If the meaning of those terms is different, then the appeal must
    succeed.

[9]

The motion judge, in careful and detailed reasons, determined that the terms
    "verdict" and "official verdict" had the same meaning as
    the term OMB Decision. The appellants contend that the motion judge erred in
    that conclusion. In particular, they contend that the fact that different terms
    were used presumptively suggests that different meanings were intended by the
    parties.

[10]

We
    agree with the conclusion reached by the motion judge. We agree with his
    conclusion that, on a fair and purposive reading of the Agreements, the parties
    intended that these terms have the same meaning. The whole purpose of the
    Agreements was to permit the respondent to make a final decision on whether to
    be bound by the Agreements depending on the final conclusion reached by the OMB
    regarding the proposed development. The respondent required a final order in
    that regard before making its decision.

[11]

The
    appellants rely on certain authorities, notably
Heritage Capital Corp. v.
    Equitable Trust Co
.,
2016 SCC 19, [2016] 1 S.C.R. 306, that [m]eaning
    must be given to the choice to use one term in one clause and a different term
    in a different clause of the same agreement (para. 47).

[12]

That
    principle is not inviolate. Its application depends on the circumstances of the
    case, the nature of the differences between the terms, and any possible reason
    for the use of different terms. In this case, it is of particular significance
    that the terms verdict and official verdict were made in handwritten
    changes to the formal agreements. The changes were made by the parties, without
    the assistance of their lawyers, who had drafted the formal agreements. In
    those circumstances, the fact that different terms were used is not surprising.
    It does not change the reality, as found by the motion judge, that the
    intention of the parties was clear. What was central to the Agreements was the
    receipt of a final decision of the OMB, and the parties agree that no such
    final decision was ever received before this dispute arose.

[13]

In
    the end result, we agree with the motion judge when he said, at para. 69:

In my
    view, the provisions in the agreements with respect to the closing dates which
    specifically provide that closing is "subject to the Buyer accepting the
    OMB Decision" are consistent with an interpretation of the agreements
    under which the terms "verdict" and "official verdict" of
    the OMB are given the same meaning as the term "OMB Decision".

[14]

We
    do not accept the appellants submission that this conclusion leads to a
    commercial absurdity. To the contrary, the interpretation accords with the
    clear intention of the parties through the Agreements.

Conclusion

[15]

The
    appeal from the judgment of the motion judge is dismissed. In accordance with
    the agreement of the parties, the appellants will pay to the respondent costs
    of the appeal fixed at $20,000 plus disbursements and HST.

P.
    Lauwers J.A.

B.W.
    Miller J.A.

I.V.B.
    Nordheimer J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Veneruzzo v. Storey, 2018 ONCA 688

DATE: 20180830

DOCKET: C63416

Doherty, Brown and Huscroft JJ.A.

BETWEEN

Louis Veneruzzo, Brenda Veneruzzo, Jason
    Veneruzzo
and Jennifer Veneruzzo

Plaintiffs
(Respondents)

and

Darryl Storey

Defendant
(Appellant)

Brendan F. Morrison and Jordan R. D. Lester, for the
    appellant

Daniel Lester and Jeffrey Moorley, for the respondents

Heard: June 28, 2017

On appeal from the order of Justice Douglas C. Shaw of
    the Superior Court of Justice, dated January 27, 2017, with reasons reported at
    2017 ONSC 683, 7 C.P.C. (8th) 430, and from the costs order dated April 24,
    2017, with reasons reported at 2017 ONSC 2532, 9 C.P.C. (8th) 136.

Doherty J.A.:

A.

overview

[1]

The respondents (plaintiffs in the action) are all close relatives of
    Jasmine Veneruzzo (Ms. Veneruzzo). Ms. Veneruzzo died in a car accident in
    December 2008. The appellant (defendant in the action) was driving the vehicle that
    struck Ms. Veneruzzos car. The appellant was charged with criminal negligence
    causing death, and eventually pleaded guilty to dangerous driving causing death
    in September 2012. In January 2013, he received a penitentiary sentence of two
    years. A related civil action was settled in 2015.

[2]

In June and July 2015, the appellant posted several comments on his
    Facebook page. Those comments referred to various things, including the
    accident that resulted in Ms. Veneruzzos death, her driving habits, the veracity
    of representations made about Ms. Veneruzzo in the proceedings, and the conduct
    of the respondents and other relatives of Ms. Veneruzzo in the aftermath of the
    accident.

[3]

The content of some of the posts led the respondents to commence an
    action for libel and related claims. The appellant filed a Statement of Defence
    in which he advanced the defences of truth, fair comment, and qualified
    privilege. At para. 18 of the Statement of Defence, he alleged that the
    comments that form the basis of the Plaintiffs claim relate to matter [
sic
]
    of significant public interest.

[4]

In June 2016, the appellant moved under s. 137.1 of the
Courts of
    Justice Act
, R.S.O. 1990, c. C.43 (
CJA
)
for an order dismissing the
    respondents action. He alleged that the claims made against him arose from
    expressions that he made on matters of public interest. He further argued that
    the respondents could not meet the criteria in s. 137.1(4).

[5]

The motion judge dismissed the motion, holding that the appellant had
    failed to demonstrate that his Facebook posts related to matters of public interest
    as required by s. 137.1(3). Having found that the appellant failed to meet that
    threshold requirement, the motion judge did not go on to consider the other
    requirements in s. 137.1(4).

[6]

The motion judge also awarded costs to the respondents (plaintiffs in
    the action), despite the language of s. 137.1(8), which creates a presumption
    that a responding party should not have its costs when a s. 137.1 motion is
    dismissed.

[7]

The appellant appeals from the order dismissing the s. 137.1 motion and,
    should the main appeal fail, seeks leave to appeal from the costs order. For
    the reasons that follow, I would dismiss the appeal, grant leave to appeal
    costs, and dismiss that appeal.

B.

The main appeal

(i)

The Facts

[8]

On December 3, 2008, the appellant, who was a police officer, was
    driving his police cruiser over 200 km/hr in a 90 km/hr zone on a highway. He
    had not engaged the siren or any emergency lighting on the vehicle.

[9]

The appellants vehicle collided with the vehicle driven by 18-year-old Ms.
    Veneruzzo as she pulled out onto the highway. Ms. Veneruzzo died at the scene.

[10]

The
    appellant was charged with criminal negligence causing death. At the end of the
    Crowns case at trial, he entered a plea to the included offence of dangerous
    driving causing death. In January 2013, the appellant was sentenced to two
    years imprisonment on the basis of a joint submission put forward by counsel. At
    the sentencing hearing, the appellant publicly apologized for his conduct.

[11]

Between
    June 20 and July 8, 2015, after the appellant had completed his sentence, he
    made a series of posts on his personal Facebook page, which was accessible to
    the public. The posts referred to a variety of topics. One alluded to the death
    of a police officer, who was a friend of the appellant, in a roadside accident.
    Others referred to the accident in which Ms. Veneruzzo was killed and the
    appellant was injured. Still other posts referred to the cruiser the appellant
    was driving at the time of the accident, the deceaseds driving conduct at the
    time of the accident and on other occasions, the conduct of the deceaseds
    relatives, and what the appellant alleged were falsehoods put forward by the
    respondents about Ms. Veneruzzos status as a high school student and her
    future plans at the time of her death.

(ii)

Reasons
    of the Motion Judge

[12]

In
    holding that the appellant had failed to show that the statements on his
    Facebook page related to a matter of public interest, the motion judge, at paras.
    30-31, correctly relied on the analysis of public interest in
Grant v.
    Torstar Corp.
, 2009 SCC 61, [2009] 3 S.C.R. 640: see
1704604 Ontario Ltd.
    v. Pointes Protection Association
, 2018 ONCA 685, at para. 58 (released
    concurrently with these reasons).

[13]

The
    motion judge, after specifically referring to the need to consider the subject
    matter of the comments as a whole, offered his characterization of the
    subject matter, at para. 34:

Mr. Storeys Facebook posts are concerned with two matters.
    First, he implies that Ms. Veneruzzo caused or contributed to the collision. He
    states that on a prior occasion she ran a stop sign at Highway 130 and Twin
    City Crossroads, that she had previously texted while driving and, on the day
    in question, that she was late for work. Second, his posts are critical of the
    Veneruzzo family for misrepresenting Ms. Veneruzzos education and career path
    at the time of the collision and for being intoxicated and belligerent towards
    police on the evening of Ms. Veneruzzos funeral. These two matters do not go
    beyond Mr. Storeys own personal interests.

[14]

The motion judge, at para. 37, drew a distinction between matters of
    public interest and a matter that, because of its notoriety, might be of some
    interest to the public:

Although notoriety may well have
    attached to the collision and to the death of Ms. Veneruzzo and to the ensuing
    criminal and civil proceedings, these were events which interested the public,
    not events which were in the public interest. These events did not affect the
    welfare of the public. Mr. Storeys posts did not assist the public to better
    understand and make decisions on issues in which they had a stake. The posts
    did not extend beyond Mr. Storeys own interests, to the interests of the
    community as a whole, or at least to a meaningful segment of the community.

(iii)

Arguments on Appeal

[15]

The
    appellant accepts that the motion judge properly identified
Grant v.
Torstar

Corp.
as the guiding authority when interpreting the phrase public
    interest in s. 137.1(3) of the
CJA
. Indeed, counsel for the appellant
    relies on the same passages cited by the motion judge in his reasons.

[16]

Counsel
    alleges two errors. He contends that the motion judge:

·

Failed to consider the relevant Facebook posts as a whole; and

·

Characterized the phrase public interest too narrowly.

(iv)

Did the Motion Judge Fail to Consider the Posts as a Whole?

[17]

A
    failure to consider the expressions that are the subject matter of the lawsuit
    as a whole and in the context in which they are made constitutes a failure to
    apply a controlling legal principle and is an error in law. Correctness is the
    appropriate standard of review in respect of this ground of appeal:
Canada
    (Director of Investigation and Research) v. Southam Inc.
, [1997] 1 S.C.R.
    748, at para. 35;
CNH Canada Ltd. v. Chesterman Farm Equipment Ltd.,
2018
    ONCA 637, at para. 34.

[18]

The
    appellant faces a difficult task in advancing this argument. The motion judge
    expressly and repeatedly acknowledged that in determining whether the
    expression related to a matter of public interest, he must consider the
    publication as a whole: see paras. 30 and 33. The appellant must convince
    this court that, despite those clear statements, the motion judge did not
    consider the publications as a whole.

[19]

The
    appellants submission that the motion judge failed to consider the posts as a
    whole comes down to the argument that there are comments in some of the posts
    that do not relate to Ms. Veneruzzo, the respondents, or the accident. He
    submits that at least some of those unrelated comments refer to matters of
    public interest (e.g. the post about police safety at roadside stops). On the
    appellants argument, these comments are sufficient to place the entirety of
    the expressions contained in the posts under the public interest protection of
    s. 137.1(3).

[20]

I cannot accept this submission. The appellant would have the court look
    at isolated portions of the communications without regard to the nature of the
    expressions that actually give rise to the proceeding. Section 137.1(3) makes clear
    that the expression at issue is the expression that gives rise to the
    proceeding. That expression must relate to a matter of public interest. The
    expressions giving rise to this proceeding are those relating to Ms. Veneruzzo
    and the respondents. A defendant who makes statements about a purely private
    matter cannot gain the protection of s. 137.1(3) by interspersing references to
    some other topic that may relate to a matter of public interest.

[21]

I
    agree with the respondents that the motion judge was not obliged to summarize
    every comment that the appellant made in the posts to demonstrate that he
    considered all of the comments in determining the subject matter of the
    expression that gave rise to the claim. The passages excerpted by the motion
    judge at para. 13 of his reasons refer to the parts of the posts that were most
    germane to his assessment of whether the lawsuit arose out of expressions that
    relate to a matter of public interest.

[22]

Nothing
    in the motion judges reasons leads me to conclude that he did not, as he said
    he did, consider the relevant communications as a whole in deciding whether
    they related to a matter of public interest.

(v)

Did
    the Motion Judge Characterize the Phrase Public Interest too Narrowly?

[23]

The
    definition of the phrase public interest in s. 137.1(3) raises a question of
    law reviewable on a correctness standard. The application of the proper
    definition to the facts of a particular case raises a question of mixed fact
    and law. Absent the identification of an extricable error of law or a palpable
    and overriding factual error, an appellate court will defer to the motion
    judges assessment:
Housen v. Nikolaisen
, 2002 SCC 33, [2002] 2 S.C.R.
    235, at paras. 33-35;
Ledcor Construction Ltd. v. Northbridge Indemnity
    Insurance Co.
, 2016 SCC 37, [2016] 2 S.C.R. 23, per Wagner J., as he then
    was, at paras. 35-36, and per Cromwell J. (concurring), at paras. 100-101;
Benhaim
    v. St-Germain
, 2016 SCC 48, [2016] 2 S.C.R. 352, at paras. 36-39.

[24]

The
    phrase public interest takes its meaning from the circumstances of the
    specific case. An exhaustive definition is impossible. One must ask: what is
    the communication impugned in the lawsuit about?

[25]

I
    agree with the motion judges characterization of the relevant posts: see
above at
para. 13. Put a little
    differently, I would characterize the comments insofar as they related to Ms.
    Veneruzzo, the accident, and the respondents, as an attempt to create a new
    narrative about the accident. In that narrative, the appellant plays the role
    of victim (e.g. the references to his injuries) and shifts the focus of the
    cause of the accident from his dangerous driving to the deceaseds driving
    habits (e.g. her alleged constant texting while driving) and her familys
    character (e.g. their alleged drinking and drunk driving on the evening of the
    funeral).

[26]

Like
    the motion judge, I see nothing in the posts that could reasonably be said to engage
    broader issues of road safety, the operation of the justice system, or the
    public perception of the conduct of the police.

[27]

The
    appellant submits that the motion judge wrongly concluded that public notoriety
    or controversy could not be equated with public interest for the purposes of s.
    137.1(3). There is no doubt that public notoriety is a kind of public interest.
    However, to the extent that the public interest does not rise above mere
    curiosity or prurient interest, it cannot satisfy the public interest
    requirement in s. 137.1(3):
Grant v.
Torstar Corp.
, at para.
    105. The motion judge appreciated this distinction.

[28]

The
    motion judge properly instructed himself on the law as it relates to the
    meaning of public interest in s. 137.1(3). I see no error in his finding that
    the appellants attempt to shift the blame for the accident to the deceased and
    her family did not constitute expression on a matter relating to the public
    interest. As the appellant had failed to meet his onus under s. 137.1(3), the
    motion judge properly dismissed the motion.

C.

the costs appeal

[29]

The
    motion judge awarded costs on a partial indemnity basis in the amount of
    $8,924.05 to the respondents, the successful parties on the motion. In the
    normal course, the motion judges order would be unremarkable. However, s.
    137.1 motions have their own costs regime. Section 137.1(7) provides that if
    the defendant (moving party) is successful in having the plaintiffs claim dismissed
    on a s. 137.1 motion, the defendant is entitled to its costs of the motion and in
    the proceeding on a full indemnity basis, unless the judge determines that such
    an award would be inappropriate in the circumstances. If the defendant is
    unsuccessful on the s. 137.1 motion, s. 137.1(8) provides:

If a judge does not dismiss a proceeding under this
    section, the responding party [plaintiff] is not entitled to costs on the
    motion, unless the judge determines that such an award is appropriate in the
    circumstances.

[30]

The
    motion judge ultimately exercised his discretion under s. 137.1(8) in favour of
    the respondents and ordered costs to them, on a partial indemnity basis.

(i)

Should Leave be Granted?

[31]

The
    appellant needs leave to appeal the costs order. The respondents argue that
    leave to appeal should be refused. They contend that this court rarely grants
    leave to appeal costs, and that the motion judges order simply reflects the
    application of the discretion clearly given to him in s. 137.1(8) to the facts
    of this case. The respondents further contend that even if the leave
    application raises a legal question of general importance, leave must be refused
    unless the court is satisfied that there is strong reason to believe that the
    motion judges order is wrong.

[32]

I
    agree with the respondents that leave to appeal costs should be granted
    sparingly. I also agree that this court will seldom interfere with a judges
    exercise of discretion as it relates to costs.

[33]

However,
    I would grant leave to appeal from the costs order in this case. The costs
    provisions in s. 137.1 are quite different from the generally applicable costs
    provisions and have not been considered by this court. I think this court should
    take this opportunity to address those provisions.

(ii)

The
    Merits of the Costs Appeal

[34]

The
    motion judge recognized that s. 137.1(8) applied and that there was a
    presumption that the respondents, even though they had been successful on the
    motion, should not receive their costs: at paras. 11-19. He gave two reasons
    for exercising his discretion in favour of granting costs to the respondents.

[35]

First,
    he held that the respondents could not be criticized for initiating the lawsuit.
    Their lawsuit had none of the features common to the typical SLAPP.
[1]
There was nothing strategic about the lawsuit and the plaintiffs did not set
    out to intimidate the appellant or extract costs from him. The motion judge
    said, at para. 17:

The plaintiffs are not attempting to suppress public
    participation. In the instant case, the plaintiffs are individuals who allege
    damage to their individual reputations. I find no ulterior motive for this
    lawsuit that would take it outside the usual considerations of a defamation
    action for damages.

[36]

Second,
    the motion judge found that the appellants argument that the relevant
    statements in the posts related to matters of public interest had no merit:
    at para. 18.

[37]

The
    motion judge concluded, at para. 19:

In my view, an award of partial indemnity costs is appropriate
    in the circumstances of this case where the defendants claim of public
    interest was found to be without merit and there are no facts that would
    suggest that a costs award would be inequitable.

[38]

The
    motion judges reasons for ordering costs in favour of the respondents are
    consistent with the rationale for the costs provisions in s. 137.1. Those
    sections are designed to encourage defendants, who have been sued over
    expressions on matters of public interest, to bring s. 137.1 motions for an
    early dismissal of those claims. The costs provisions ease the financial burden
    and risk placed on the defendant who seeks an early termination of what it
    claims is a SLAPP:
Accruent LLC v. Mishimagi
, 2016 ONSC 6924, 9 C.P.C.
    (8th) 136,  at para. 4.

[39]

The
    purpose underlying the costs provisions in s. 137.1 disappears when the lawsuit
    has none of the characteristics of a SLAPP, and the impugned expression is
    unrelated to a matter of public interest. In those circumstances, it is not the
    initial lawsuit challenging the expression that represents a potential misuse
    of the litigation process, but rather the s. 137.1 motion. A costs order
    denying a successful respondent its costs on a s. 137.1 motion, even though the
    lawsuit was not brought for an improper motive and the claim did not relate to
    a matter of public interest, could be seen as encouraging defendants to bring
    meritless s. 137.1 motions.

[40]

The
    trial judges findings that the respondents did not bring the lawsuit for any
    improper purpose and that there was no merit to the appellants s. 137.1
    argument were both available on the evidence. Both factors are properly
    considered in exercising the discretion provided in s. 137.1(8). Taken
    together, those factors provided a reasonable basis for the motion judges
    conclusion that a costs award in favour of the respondents was appropriate in
    the circumstances. I would defer to that conclusion.

D.

conclusion

[41]

I
    would dismiss the appeal on the merits, grant leave to appeal costs, and
    dismiss that appeal.

[42]

Counsel
    for the parties agreed on the costs of the appeal. The respondents should have
    their costs on the main appeal fixed in the amount of $6,500. I would make no
    order as to costs on the costs appeal. It is unclear whether the amounts agreed
    upon by counsel include HST and reasonable disbursements. If they do not, those
    amounts should be added to the amounts awarded above.

Released: DD  AUG 30 2018

Doherty J.A.

I agree D.M. Brown
    J.A.

I agree Grant Huscroft
    J.A.

[1]

SLAPP refers to Strategic Lawsuits Against Public
    Participation.


COURT OF APPEAL FOR ONTARIO

CITATION:  Winter v. Sherman Estate, 2018 ONCA 703

DATE: 20180829

DOCKET: C64434

Sharpe, Juriansz and Roberts JJ.A.

BETWEEN

Kerry J.D. Winter, Jeffrey Barkin, Paul T. Barkin
and Julia Winter, personal representative of Dana C. Winter, deceased

Plaintiffs
(Appellants)

and

The Estate of Bernard C. Sherman, deceased, Meyer
    F. Florence,
Apotex Inc. and Joel D. Ulster

Defendants
(Respondents)

Brad Teplitsky, for the appellants

Katherine Kay and Mark Walli, for the respondents

Heard: August 15, 2018

On appeal from the judgment of Justice Kenneth G.
    Hood of the Superior Court of Justice, dated September 15, 2017, with reasons
    reported at 2017 ONSC 5492.

REASONS FOR DECISION

[1]

The appellants appeal
    from the dismissal of their action.
[1]
The motion judge found there was no genuine
    issue requiring a trial that the late Dr. Sherman owed the appellants an
ad hoc
fiduciary duty to look after their
    financial interests. He also
dismissed the action on the ground that the action was
    an abuse of process in that it was an attempt to re-litigate issues determined
    by the appellants unsuccessful action against the
Royal Trust Company
    and Royal Trust Corporation of Canada ("Royal Trust")
, the trustee of
    their parents estates.

[2]

These
    proceedings arise out of a bitter family dispute between the appellants and
    their first cousin, the late Dr. Sherman. The appellants allege Dr. Sherman made
    a commitment to look after their financial interests when the appellants were
    very young children
and
    recently orphaned. Specifically, they contend this
ad hoc
fiduciary duty arose during the
    purchase by Dr. Sherman and Joel Ulster of the assets of the family businesses
    owned by the estates of the appellants parents (the Empire Companies). They plead
    the respondents breached that duty by dishonouring an option agreement given as
    part of the consideration for the purchase that would have allowed the appellants
    to be employed by and acquire 5% of the shares of the Empire Companies. Because
    of the breach, the appellants claim a 20% interest in Apotex Inc. or the
    equivalent in damages.

[3]

The appellants
    submit that the motion judge erred by failing to recognize that the crux of the
    present action against the respondents was whether Dr. Sherman owed them an
ad hoc
fiduciary duty and to identify the
    clear indicia of the fiduciary relationship between them. They say he further
    erred by concluding that the identical issues had been determined by Perell J. in
    the proceedings against Royal Trust and were dispositive of the issues in the
    present action.

[4]

We do not accept these
    submissions.

[5]

The motion judge properly
    considered the criteria for the creation of
an
ad hoc
fiduciary duty as articulated by the
    Supreme Court in
Elder Advocates of Alberta Society v. Alberta
, 2011 SCC 24, [2011] 2 S.C.R. 261.
    Applying those criteria, he carefully analyzed the evidence of the parties
    relationship and the communications between Dr. Sherman and Royal Trust in
    relation to Dr. Shermans acquisition and subsequent sale of his interest in
    the Empire Companies. He did not accept the appellants interpretation of that
    evidence as giving rise to a fiduciary relationship or duty. Rather, he concluded
    that Dr. Sherman did not undertake to look after the appellants interests or ever
    abandon his own self-interest. As the motion judge succinctly put it:

It was up to Royal Trust to look after the plaintiffs interests,
    not Sherman. It is clear from the correspondence, Shermans evidence, the
    purchase agreement itself, and the findings made by Justice Perell that there
    was only so much that Sherman was prepared to do for the plaintiffs if he was
    to become the buyer of the Empire Companies.  Royal Trust knew that.  At the
    end of the day, Sherman was looking after his own interests  not those of the
    plaintiffs. His obligations to the plaintiffs were clearly set out in the
    purchase agreement and eventual option agreement. The obligations, such as they
    were in the contracts, cannot create a fiduciary duty.  There was never a point
    where Sherman relinquished his own self-interest and agreed to act solely on
    behalf of the plaintiffs:
Hodgkinson v. Simms
, [1994] 3 S.C.R. 377,
    at para. 33. To the contrary, Shermans self-interest was always clear. That
    self-interest was made known to Royal Trust and found its way into the
    contracts for the purchase of the Empire Companies.

[6]

There is no error
    in the motion judges meticulous analysis or findings.

[7]

Further, the
    appellants too narrowly construe the doctrine of abuse of process.
This doctrine is flexible
    and unencumbered by the specific requirements of
res judicata
or issue estoppel:
Behn v. Moulton
    Contracting Ltd
.
, 2013 SCC 26, [2013] 2 S.C.R. 227, at para 40;
Toronto (City) v.
    C.U.P.E., Local 79
, 2003 SCC 63, [2002] 3 S.C.R. 77, at para. 42. Where a
    precondition for issue estoppel has not been met, such as mutuality of parties,
    courts have turned to the doctrine of abuse of process to preclude
    re-litigation of the same issue:
C.U.P.E.
, at para. 37. While the doctrine is similar to issue
    estoppel in that it can bar litigation of legal and factual issues that are
    necessarily bound up with the determination of an issue in the prior
    proceeding, abuse of process also applies where issues could have been
    determined:
Danyluk v. Ainsworth Technologies Inc.
, 2001 SCC 44, [2001] 2 S.C.R. 460,
    at para. 54;
Aba-Alkhail v. University of Ottawa
, 2013 ONCA 633, 363 D.L.R. (4th)
    470, at para. 13;
McQuillan v. Native Inter-Tribal Housing Co-Operative Inc.
(1998), 42 O.R. (3d) 46
    (C.A.), at pp. 50 - 51. As such, the doctrine of abuse of process is broader
    than
res
    judicata

and
    issue estoppel and applies to bar litigation that, if it proceeded, would
    violate such principles as judicial economy, consistency, finality and the
    integrity of the administration of justice:
C.U.P.E.
, at para. 37
.

[8]

We agree with the
    motion judge that the whole evidentiary underpinning of this action is the same
    as that of the Royal Trust action and that it would be unfair and an abuse of
    process to allow the appellants to in effect, re-litigate their case, with a
    new theory, to see if this one will succeed where previous theories have
    failed. Moreover, the doctrine of abuse of process applies to prevent
    re-litigation of previously decided facts:
Intact Insurance Company v. Federated
    Insurance Company of Canada
, 2017 ONCA 73, 134 O.R. (3d) 241, at para. 28, leave to
    appeal refused, [2017] S.C.C.A. No. 98;
R. v. Mahalingan
,

2008 SCC 63, [2008] 3
    S.C.R. 316, at para. 46;
C.U.P.E.
, at para 37.

As
    the motion judge determined, the relief and issues put forward by the appellants
    in these proceedings arise from the same relationships and subject matter that
    have already been dealt with by Perell J. and the Court of Appeal in the Royal
    Trust action.

[9]

We do not accept
    the appellants argument that their present action encompasses more than the
    interpretation of the option agreement and that the existence of a fiduciary
    duty overlays any obligations that Dr. Sherman had under that agreement.  As
    the motion judge observed, Perell J. determined that the limited, qualified,
    contingent and conditional option agreement expressed precisely what had been
    agreed upon by the parties and that Dr. Sherman was not prepared to offer
    anything further.

[10]

As a result, we
    find no error in the motion judges determination that the appellants present
    action is an abuse of process.

Disposition

[11]

Accordingly, the
    appeal is dismissed.

[12]

The respondents are
    entitled to their costs of $60,000, the amount the parties agreed to be
    reasonable, including disbursements and all applicable taxes.

Robert J. Sharpe J.A.

R.G. Juriansz J.A.

L.B. Roberts J.A.

[1]

By notice dated August 8, 2018, the respondents abandoned
    their costs appeal.