Law Times

Law Times • may 15, 2017 Page 15 www.lawtimesnews.com CASELAW Ontario Civil Cases Bankruptcy and Insolvency AVOIDANCE OF TRANSACTIONS PRIOR TO BANKRUPTCY Recovery of proceeds or property Bankrupt was engaged in effort to defraud Bankrupt re-sold telephone equipment. In May 2012, bank- rupt began paying consultant, C, and C's company $10,000 per month. In November 2013, bankrupt began receiving loans from new lender it reported as revenue. In March 2015, bank- rupt's old lender brought ap- plication for bankrupt's receiv- ership. In April 2015, receiver and manager were appointed. In July 2015, bankrupt was as- signed into bankruptcy. At Oc- tober 2015 examination under s. 163 of BIA, C testified he had no contact with and could not name any of bankrupt's cus- tomers or suppliers. Trustee in bankruptcy brought mo- tion for order requiring C and C's company to repay $159,330 transferred during year prior to March 2014 (relevant period) to estate of bankrupt under s. 96 of Bankruptcy and Insolvency Act (BIA). Motion granted; C and C's company ordered to pay es- tate $159,330. Payments to num- bered company during relevant period fell within s. 96(1)(b)(i) of BIA. Although applications were generally to be brought as motions, judge had discretion to order trial or use summary process if it would yield fair re- sult. No trial was necessary as issue was narrow, parties' com- plete evidence was before court, protagonists had been cross- examined, and there was rela- tively small amount of money in issue. Section 96 did not require trustee to prove bankrupt was engaged in scheme to defeat its creditors generally or as group. C's affidavit evidence from his knowledge of bankrupt's customers to how he brought bankrupt millions of dollars in sales was contradictory. Value of consideration C and C's com- pany gave to bankrupt were pre- sumptively what trustee opined, which was zero. There was no legal or persuasive burden on C or C's company but, in absence of credible evidence to con- trary, trustee proved on balance of probabilities that C and C's company provided no services of any value to bankrupt dur- ing relevant period and that all payments bankrupt made to C or C's company from that date were "payments at undervalue." It was clear and undisputed that during relevant period, bank- rupt was engaged in effort to defraud and delay bank from learning it was insolvent and borrowing from different lend- er. Three badges of fraud were found and gave rise to presump- tion that bankrupt intended to defraud, defeat, or delay old lender. There was no evidence of bona fide value f lowing from C or C's company to bankrupt even before relevant period. While solvent company was entitled to make payments for non-commercial or uneconom- ic motivations, insolvent com- pany making such payments for no consideration while actively defrauding its principal lender could not be said to be acting in ordinary course of business. National Telecommuni- cations Inc., Re (2017), 2017 CarswellOnt 3184, 2017 ONSC 1475, F.L. Myers J. (Ont. S.C.J. [Commercial List]). Civil Practice and Procedure TRIALS Jury trial New trial was not justified Appellant S was driving on two-lane road, when respon- dent N's car in opposite lane was struck and pushed into S's lane. S struck N's vehicle. N brought action against S for negligence. At trial, N had settled claim against other driver and dam- ages were agreed upon with S. Jury found S to be liable for ac- cident. S claimed that jury's ver- dict was unreasonable, as they held S to standard of perfection. S claimed that specifically inap- propriate instruction was given, as to S's speed while driving. S finally claimed that N's counsel made inappropriate remarks, given that damages were not in issue. S appealed from finding of liability. Appeal dismissed. N's trial counsel's comments as to effects of accident on N and family were clearly improper. Trial judge charged jury, and explained that sympathy for N and family were not to play role in verdict. New trial was not justified based on any or all of grounds of appeal. Norman (Litigation guard- ian of) v. van Meppelen Schep- pink (2017), 2017 CarswellOnt 3209, 2017 ONCA 192, R.G. Juriansz J.A., David Brown J.A., and B.W. Miller J.A. (Ont. C.A.). Conflict of Laws FAMILY LAW Children Hague Convention did not apply since child was habitually resident in Ontario Parties married in 2011 and had child in 2012 in Texas. Parties moved to Israel with child in 2013 or 2014. Parties and child went to Ontario in August 2015 and expected to return to Israel three months later. Mother ultimately remained in Ontario with child, while father returned to Israel. Appli- cation judge dismissed father's application in Ontario under Hague Convention on the Civil Aspects of International Child Abduction, 1980 (Hague Convention) for order requir- ing mother to return child to Israel. Judge held that Hague Convention did not apply since child was habitually resident in Ontario at relevant time. Judge found that parties mutually agreed to change habitual resi- dence from Israel to Ontario around middle of October 2015, but that father later changed his mind and decided to remain in Israel while mother and child remained in Ontario. Judge found that child had been ha- bitually resident in Ontario for appreciable period of time since father had acquiesced to child remaining in Ontario and had not sought return of child until March 2016. Father appealed. Appeal dismissed. Judge did not make palpable and over- riding errors in her findings of fact or conclusion that father acquiesced to child remaining in Ontario. It was not for appel- late court to reassess evidence, as father requested. Unger v. Unger (2017), 2017 CarswellOnt 4796, 2017 ONCA 270, K. Feldman J.A., Robert J. Sharpe J.A., and L.B. Roberts J.A. (Ont. C.A.); affirmed (2016), 2016 CarswellOnt 10374, 2016 ONSC 4258, L.E. Fryer J. (Ont. S.C.J.). Criminal Law PRE-TRIAL PROCEDURE Search and seizure under proceeds of crime legislation Attorney General's application for forfeiture order was granted Police began investigation into marijuana grow operation. Search warrant was obtained and executed. Police searched camping trailer and found $44,425, among other items. Attorney General brought ap- plication for forfeiture order. Application granted. Applica- tion judge held that it was more probable than not that money seized by police was proceeds or instrument of unlawful ac- tivity, namely trafficking in narcotics. Other items associ- ated with drug trafficking were found inside trailer. Money was found in environment which, on balance, was used in traf- ficking. Occupier of trailer f led scene when police attended. Application judge found there was no credible explanation for legitimate source for money. Accused appealed. Appeal dis- missed. Application judge was entitled to accept uncontra- dicted opinion of police officer that funds were connected to unlawful activity. Application judge gave cogent reasons for rejecting accused's explanation and his conclusion was fully supported by record. Ontario (Attorney Gen- eral) v. $44,425 in Canadian currency (In Rem) (2017), 2017 CarswellOnt 3210, 2017 ONCA 201, Alexandra Hoy A.C.J.O., Eileen E. Gillese J.A., and D.M. Brown J.A. (Ont. C.A.); affirmed (2015), 2015 CarswellOnt 18034, 2015 ONSC 7382, Ronald M. Laliberte Jr. J. (Ont. S.C.J.). Health Law PROVINCIAL MATTERS Regulation of health professionals Committee imposed reasonable restrictions to protect public interest Doctor was arrested and crimi- nally charged with sexual as- sault, sexual interference and sexual touching in relation to inappropriate sexual behaviour between doctor and 13-year-old patient. College was notified and it conducted investigation. Criminal charges were stayed. College's Inquiries, Complaints and Reports Committee con- sidered college's investigation and made interim order di- recting doctor to refrain from performing other functions ex- cept those required in practice monitor's undertaking and to notify patients of restrictions . Doctor brought application for judicial review of interim order . Application dismissed. Doctor did not demonstrate unreasonableness of decision. In face of serious allegations, committee imposed reasonable restrictions when balanced with committee's legislative man- date to protect public interest, deference owed to its expertise and interim nature of proceed- ing. Pattern of isolating young patients and then allegedly en- gaging in sexual fondling was repeated. Interim order did not shut down doctor's practice but rather necessarily imposed rea- sonable restrictions to protect public interest. Morzaria v. College of Phy- sicians and Surgeons of On- tario (2017), 2017 CarswellOnt 4256, 2017 ONSC 1940, Sachs J., Nordheimer J., and Gilmore J. (Ont. Div. Ct.). Judges and Courts CONTEMPT OF COURT Forms of contempt Media defendants were in contempt of injunction Defendant C was owner of me- dia company which published largest Filipino newspaper ser- vicing GTA and Hamilton. C was publisher and editor of pa- per. Summary judgment was granted in July 2016 in favour of plaintiff for libel. Media de- fendants, including C and her company, were liable to pay plaintiff general and aggravated damages, punitive damages, in- terest, and costs on substantial indemnity basis. Permanent in- junction was granted enjoining media defendants from publish- ing statements suggesting that plaintiff committed criminal fraud in respect of fundraising activities for cultural commu- nity centre or that by virtue of plaintiff 's involvement in fund- raising activities for community centre in 2001 and by virtue of his statements in relation to charitable status of organiza- tion, that he was pathological or biological liar. Media defen- dants appealed damages award but did not appeal from find- ings of liability. Plaintiff moved for order finding media defen- dants in contempt of injunction. Media defendants had commit- ted criminal contempt and sen- tencing was to be scheduled at case conference. Injunction was clear and unequivocal in pro- hibiting, at minimum, re-publi- cation of statements that assert- ed truth of allegations in article and Facebook posting that C admitted were false and which court found were false. Media defendants knew that judgment meant they were enjoined from repeating allegations in article and in Facebook posting that were before motion judge as he held expressly that they carried defined meanings set out in injunction. Emails sent out to third parties showed that C was continuing efforts to besmirch plaintiff 's reputation by repeat- ing and re-asserting truth of same falsehoods that were sub- ject of injunction. Cover email by which email exchange was further disseminated to third parties left no doubt that C and media defendants were aware of injunction, and in her own words, C made contumacious intention plan. Plaintiff proved beyond reasonable doubt that media defendants committed all elements of test for contempt of court. Enverga v. Balita Newspa- per (2017), 2017 CarswellOnt 3700, 2017 ONSC 1635, F.L. My- ers J. (Ont. S.C.J.). Ontario Criminal Cases Criminal Law EXTRAORDINARY REMEDIES Habeas corpus with certiorari in aid Application in nature of habeas corpus with certiorari in aid was dismissed Accused was convicted on charge of importing cocaine as person charged with offence un- der s. 6(1) of Controlled Drugs and Substances Act. Accused brought application in nature of habeas corpus with certio- rari in aid before judge of Supe- rior Court of Justice which was dismissed. Accused appealed. Appeal dismissed. Limited ex- ception to general unavailabil- ity of habeas corpus as remedy against denial of judicial inter- im release was beyond accused's grasp. Further, accused has not attempted to comply with no- tice requirements applicable to challenges under s. 52 of Con- stitution Act. To permit her to invoke habeas corpus to achieve same result would be to allow her to mount indirect attack on integrity of the legislation, a course that was not open to her. R. v. Passera (2017), 2017 CarswellOnt 5311, 2017 ONCA 308, David Watt J.A., K. van Rensburg J.A., and G. Pardu J.A. (Ont. C.A.).

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