Downtown Eatery (1993) Ltd. v. Ontario et al., [2000] O.T.C. 141 (SupCt)

Judge:C. Campbell, J.
Court:Superior Court of Justice of Ontario
Case Date:March 03, 2000
Jurisdiction:Ontario
Citations:[2000] O.T.C. 141 (SupCt)
 
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Downtown Eatery Ltd. v. Ont., [2000] O.T.C. 141 (SupCt)

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Temp. Cite: [2000] O.T.C. TBEd. MR.051

Downtown Eatery (1993) Ltd. (plaintiff) v. Her Majesty The Queen in Right of Ontario and Joseph Alouche (defendants)

Joseph Alouche (plaintiff by counterclaim) v. The Landing Strip Inc., The Landing Restaurant Inc., The Landing Restaurant (1993) Limited, Downtown Eatery Limited, Downtown Eatery (1993) Limited, Best Beaver Management Inc. (Ontario Corporation #971712), Best Beaver Management Inc. (Ontario Corporation #1042788), Twin Peaks Inc., Herman Grad and Ben Grosman (defendants to the counterclaim)

(File No. 97-CV-129317)

Indexed As: Downtown Eatery (1993) Ltd. v. Ontario et al.

Court of Ontario

Superior Court of Justice

C. Campbell, J.

March 3, 2000.

Summary:

Alouche obtained a judgment against Best Beaver (his employer) for breach of an employment contract. Best Beaver acted as an employment agency for establishments owned by Grad and Grosman through a group of interrelated companies. A subsequent amalgamation and corporate reorganization resulted in Alouche being unable to enforce his judgment. Alouche claimed against Grad and Grosman and the other interrelated companies (defendants). Alouche claimed that the defendants were liable as common employers, that he was entitled to oppression relief under the Ontario Business Corporations Act or that he was entitled to a tracing remedy for fraudulent conveyance.

The Ontario Superior Court dismissed Alouche's action. The 1993 amalgamation and 1996 corporate reorganization occurred before Alouche obtained judgment and were not undertaken to defeat any judgment he might obtain. Although more than one entity could be Alouche's employer, where Alouche sued and obtained judgment against only Best Beaver (withdrew a motion to add the other defendants), he was now estopped from claiming any other person or corporate entity was liable as an employer. While judgment creditors were entitled in certain circumstances to apply for an oppression remedy, claims for damages for wrongful dismissal and related relief were not appropriate for redress using the oppression remedy (unless the reorganization and amalgamation had been intentionally undertaken to defeat his claims). Finally, there was no fraudulent conveyance and Alouche failed to meet the requirements for a tracing order.

Company Law - Topic 9783

Actions against corporations and directors - Action for oppressive conduct - Persons entitled - See paragraphs 34 to 40.

Estoppel - Topic 386

Estoppel by record (res judicata) - Res judicata as a bar to subsequent proceedings - Issues decided in prior proceedings - See paragraphs 16 to 33.

Estoppel - Topic 387

Estoppel by record (res judicata) - Res judicata as a bar to subsequent proceedings - Matters or claims available in prior proceedings - See paragraphs 16 to 33.

Fraud and Misrepresentation - Topic 1505

Fraudulent conveyances and preferences - Sale or transfer by debtor to third parties - Liability of third parties - See paragraphs 41 to 50.

Fraud and Misrepresentation - Topic 1606

Fraudulent conveyances and preferences - Practice - Tracing - See paragraphs 41 to 50.

Master and Servant - Topic 1024

Contract of hiring (employment contract) - Parties - Employer - What constitutes - See paragraphs 16 to 33.

Cases Noticed:

Prince et al. v. Eaton (T.) Co. (1990), 47 B.C.L.R.(2d) 310 (S.C.), affd. (1992), 14 B.C.A.C. 112; 26 W.A.C. 112; 91 D.L.R.(4th) 509 (C.A.), refd to. [para. 16].

Bagby v. Gustavson International Drilling Co. (1980), 24 A.R. 181 (C.A.), refd to. [para. 17].

Jones v. CAE Industries Ltd. (1991), 40 C.C.E.L. 236 (Ont. Gen. Div.), agreed with [para. 19].

Sinclair v. Dover Engineering Services Ltd. (1987), 11 B.C.L.R.(2d) 176 (S.C.), dist. [para. 20].

ATL Industries Ltd. v. Han Eol Industries Co. (1995), 36 C.P.C.(3d) 288 (Ont. Gen. Div.), refd to. [para. 26].

Hoque v. Montreal Trust Co. (1997), 162 N.S.R.(2d) 321; 485 A.P.R. 321 (C.A.), refd to. [para. 30].

Cidiplex-Plastic Suppliers Inc. v. Elta Group Inc. (1995), 131 D.L.R.(4th) 399 (Ont. Gen. Div.), refd to. [para. 36].

SCI Systems Inc. v. Gornitzki Thompson & Little Co. et al. (1997), 29 O.T.C. 148; 147 D.L.R.(4th) 300 (Gen. Div.), refd to. [para. 37].

Levy-Russell et al. v. Shieldings Inc. et al. (1998), 93 O.T.C. 241; 41 O.R.(3d) 54 (Gen. Div.), refd to. [para. 37].

Mohan v. Philmar Lumber (Markham) Ltd., [1991] O.J. No. 3451 (Gen. Div.), refd to. [para. 38].

Royal Trust Corp. v. Hordo, [1993] O.J. No. 1560 (Gen. Div.), refd to. [para. 39].

Centro Capital Corp. v. Clausi (1993), 13 O.R.(3d) 335 (Gen. Div.), refd to. [para. 50].

Statutes Noticed:

Courts of Justice Act, R.S.O. 1990, c. C-43, sect. 139(1) [para. 21].

Fraudulent Conveyances Act, R.S.O. 1990, c. F-29, sect. 2 [para. 47].

Authors and Works Noticed:

Goff and Jones, The Law of Restitution (1990), p. 140 [para. 50].

Sopinka, Lederman and Bryant, The Law of Evidence (2nd Ed. 1999), pp. 1078 [para. 25]; 1079 [para. 29].

Counsel:

John P. Conway, for the plaintiff and defendants by counterclaim;

J.G. Hodder, for the defendant, Joseph Alouche.

This case was heard on February 23-25, 2000, before C. Campbell, J., of the Ontario Superior Court, whose following judgment was released on March 3, 2000.

Please note: The following judgment has not been edited.

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