Akagi v. Synergy Group (2000) Inc. et al., 2015 ONCA 368

• Judge: Simmons, Blair and Juriansz, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: December 12, 2014
• Jurisdiction: Ontario
• Citations: 2015 ONCA 368;(2015), 334 O.A.C. 279 (CA)

Akagi v. Synergy Group Inc. (2015), 334 O.A.C. 279 (CA)

MLB headnote and full text

Temp. Cite: [2015] O.A.C. TBEd. MY.030

Trent Akagi (applicant/respondent) v. Synergy Group (2000) Inc. (aka Synergy Group Inc., Synergy Group 2000 Inc., The Synergy Group 2000 Inc., The Synergy Group, Inc., (2000), The Synergy Group Incorporated, The Synergy Group 2000 Incorporated) and Integrated Business Concepts Inc. (respondents/appellants)

(C57582; C59494; C59496; C59497; C59498; C59499; C59500; C59508; C59509; C59510; C59511; 2015 ONCA 368)

Indexed As: Akagi v. Synergy Group (2000) Inc. et al.

Ontario Court of Appeal

Simmons, Blair and Juriansz, JJ.A.

May 22, 2015.

Summary:

Akagi contributed funds to a tax program, marketed and sold by the Synergy Group. It was supposed to generate tax loss allocations for him, but did not. He sued Synergy Group (2000) Inc. and certain individuals associated with it for fraud and obtained default judgment in the amount of approximately $137,000. On June 14, 2013, Akagi applied for, and obtained, an ex parte order appointing a receiver over all assets, undertakings and property of Synergy and an additional company, Integrated Business Concepts Inc. Subsequently, through a series of ex parte applications, the receivership order morphed into a wide-ranging "investigative receivership", freezing and otherwise reaching the assets of 43 additional individuals and entities (including authorizing the registration of certificates of pending litigation against their properties). The appellants moved before the application judge in a "come-back proceeding" to set aside the receivership orders. Their application was dismissed. The appellants appealed.

The Ontario Court of Appeal allowed the appeal, setting aside the receivership orders.

Receivers - Topic 1667

Appointment - Appointment order - Setting aside - [See Receivers - Topic 2201 ].

Receivers - Topic 2201

Powers - General - Akagi contributed funds to a tax program, marketed and sold by the Synergy Group. - It was supposed to generate tax loss allocations for him, but did not - He sued Synergy Group (2000) Inc. and certain individuals associated with it for fraud and obtained default judgment in the amount of approximately $137,000 - On June 14, 2013, Akagi applied for, and obtained, an ex parte order appointing a receiver over all assets, undertakings and property of Synergy and an additional company, Integrated Business Concepts Inc. - Subsequently, through a series of ex parte applications, the receivership order morphed into a wide-ranging "investigative receivership", freezing and otherwise reaching the assets of 43 additional individuals and entities (including authorizing the registration of certificates of pending litigation against their properties) - The appellants moved before the application judge in a "come-back proceeding" to set aside the receivership orders - Their application was dismissed - The appellants appealed - The Ontario Court of Appeal allowed the appeal - The receivership orders had to be set aside - They stood on a fundamentally flawed premise and were unjustifiably overreaching in the powers they granted - Procedurally, they called for at least a word of caution as well, although it was not necessary to dispose of the appeal on this basis - The procedural concerns arose out of the ex parte nature of the developing set of extraordinary orders, the somewhat casual manner in which they were processed, and the failure to make full disclosure - See paragraphs 59 to 113.

Cases Noticed:

RJR-MacDonald Inc. et Imperial Tobacco Ltd. v. Canada (Procureur général), [1994] 1 S.C.R. 311; 164 N.R. 1, refd to. [para. 49].

Illidge (Bankrupt) et al. v. St. James Securities Inc. et al. (2002), 159 O.A.C. 311; 60 O.R.(3d) 155 (C.A.), refd to. [para. 56].

Ontario v. Shehrazad Non-Profit Housing Inc. (2007), 223 O.A.C. 76; 85 O.R.(3d) 81; 2007 ONCA 267, refd to. [para. 56].

Stroh v. Millers Cove Resources Inc. et al. (1995), 83 O.A.C. 202 (Div. Ct.), affd. (1995), 85 O.A.C. 26 (Div. Ct.), consd. [para. 69], refd to. [para. 66].

Loblaw Brands Ltd. v. Thornton et al., [2009] O.T.C. Uned. 693 (Sup. Ct.), dist. [para. 75], refd to. [para. 66].

General Electric Canada Real Estate Financing Holding Co. et al. v. Liberty Assisted Living Inc. et al., [2011] O.T.C. Uned. 4136; 2011 ONSC 4136, affd. (2011), 282 O.A.C. 345; 2011 ONSC 4704 (Div. Ct.), refd to. [para. 66].

DeGroote v. DC Entertainment Corp. et al., [2013] O.T.C. Uned. 7101; 2013 ONSC 7101, refd to. [para. 66].

East Guardian SPC v. Mazur, 2014 ONSC 6403, refd to. [para. 66].

236523 Ontario Inc. et al. v. Nowack, [2013] O.T.C. Uned. 7479; 2013 ONSC 7479, refd to. [para. 66].

Romspen Investment Corp. v. Hargate Properties Inc. et al., [2011] A.R. Uned. 788; 2011 ABQB 759, refd to. [para. 66].

Baker and Paddock Inn Peterborough Ltd., Re (1977), 16 O.R.(2d) 38 (H.C.), refd to. [para. 69, footnote 3].

Pandora Select Partners LP et al. v. Strategy Real Estate Investments Ltd., [2007] O.T.C. Uned. 377 (Sup. Ct.), refd to. [para. 69, footnote 3].

Pandya v. Simpson et al., [2006] O.T.C. 507 (Sup. Ct.), consd. [para. 72].

Udayan Pandya v. Courtney Wallis Simpson - see Pandya v. Simpson et al.

CanaSea PetroGas Group Holdings Ltd., Re, 2014 ONSC 6116, refd to. [para. 95].

Ryder Truck Rental Canada Ltd. v. 568907 Ontario Ltd. (Trustee of), [1987] O.J. No. 2315 (H.C.), refd to. [para. 101].

Chilian et al. v. Augdome Corp. et al. (1991), 44 O.A.C. 263; 78 D.L.R.(4th) 129; 2 O.R.(3d) 696 (C.A.), refd to. [para. 111].

Erdman (Bankrupt), Re, [2012] O.T.C. Uned. 3268; 2012 ONSC 3268, refd to. [para. 111].

Counsel:

J. Lisus and J. Renihan, for the appellants, Student Housing Canada and R.V. Inc.;

J. Spotswood and W. McDowell, for the appellants, Integrated Business Concepts Inc. and Vincent Villanti;

D. Magisano and S. Puddister, for the appellant, Ravendra Chaudhary;

M. Katzman, for the appellants, Synergy Group (2000) Inc., Shane Smith, Nadine Theresa Smith, David Prentice, Jean Lucien Breau and 1893700 Ontario Limited;

J. Leon and R. Promislow, for the respondent, J.P. Graci & Associates (the court appointed receiver);

T. Corsianos, for the respondent, Trent Akagi.

This appeal was heard on December 12, 2014, by Simmons, Blair and Juriansz, JJ.A., of the Ontario Court of Appeal. The following judgment of the Court of Appeal was delivered by Blair, J.A., on May 22, 2015.