Kovacs v. TD Financial Group et al., 2010 ONSC 6111

• Judge: Molloy, J.
• Court: Superior Court of Justice of Ontario (Canada)
• Case Date: September 30, 2010
• Jurisdiction: Ontario
• Citations: 2010 ONSC 6111;(2010), 278 O.A.C. 14 (DC)

Kovacs v. TD Financial (2010), 278 O.A.C. 14 (DC)

MLB headnote and full text

Temp. Cite: [2010] O.A.C. TBEd. NO.012

Imre Kovacs (plaintiff/responding party) v. TD Financial Group, TD Canada Trust, TD Waterhouse and Csaba Nagy (defendants/moving parties)

(447/10; 2010 ONSC 6111)

Indexed As: Kovacs v. TD Financial Group et al.

Court of Ontario

Superior Court of Justice

Divisional Court

Molloy, J.

November 5, 2010.

Summary:

The plaintiff sued a bank group (the bank) for having, at the request of her ex-boyfriend, and in spite of a Master's order requiring payment into court, wrongfully transferred her share of jointly-owned funds to an unreachable offshore bank account. The plaintiff sought a declaration that the bank was in contempt of the Master's order, and damages of $3 million for negligence, breach of fiduciary duty and breach of trust, as well as punitive damages. The bank moved to strike the plaintiff's statement of claim for failure to disclose a cause of action.

The Ontario Superior Court, in a decision reported [2010] O.T.C. Uned. 3469, dismissed the motion. The bank applied for leave to appeal.

The Ontario Divisional Court, per Molloy, J., allowed the application only in respect of the contempt claim.

Practice - Topic 5650

Judgments and orders - Declaratory judgments - General - [See first Practice - Topic 8875 ].

Practice - Topic 8875

Appeals - Leave to appeal - From allowance or dismissal of interlocutory application - In refusing to strike a statement of claim that sought a declaration of contempt as well as damages for a civil wrong, the motions judge ruled that the plaintiff was not advancing a civil cause of action for contempt because "no remedy is sought" in that the plaintiff sought "merely a declaration that contempt existed" - The Ontario Divisional Court, per Molloy, J., granted leave - There was reason to doubt the correctness of the motions judge's ruling that no remedy was sought for contempt - The courts had consistently held that a declaration was a remedy - In addition, there was doubt as to whether contempt, a quasi-criminal proceeding, could be sought along with civil damages since the defendant could lose procedural safeguards such as the right to be protected against self-incrimination - Finally, the matter raised "important issues with a broad impact beyond the parties involved here" - See paragraphs 18 to 28.

Practice - Topic 8875

Appeals - Leave to appeal - From allowance or dismissal of interlocutory application - The plaintiff sued a bank group (the bank) for having, at the request of her ex-boyfriend, and being aware of her interest, wrongfully transferred her share of jointly-owned funds to an unreachable offshore bank account - The plaintiff sought damages for negligence, breach of trust and breach of fiduciary duty - A motions judge declined to strike the statement of claim for failure to disclose a cause of action - The motion judge held that the foreseeability test for negligence had been met - As for the breach of trust and breach of fiduciary duty claims, the motions judge held that there was some possibility of success - The Ontario Divisional Court, per Molloy, J., denied leave to appeal where there was no reason to doubt the correctness of the motions judge's ruling - See paragraphs 29 to 41.

Practice - Topic 8875

Appeals - Leave to appeal - From allowance or dismissal of interlocutory application - The plaintiff sued a bank group (the bank) for having, at the request of her ex-boyfriend, and in spite of a Master's order requiring payment into court, wrongfully transferred her share of jointly-owned funds to an unreachable offshore bank account - A motions judge declined to strike the statement of claim, ruling that the Master had jurisdiction to make the order that he did - The Ontario Divisional Court, per Molloy, J., denied leave to appeal - Regardless of whether the Master's order was a nullity (which was far from clear) and regardless of whether the rule against collateral attack on court orders applied, the plaintiff advanced an arguable case that as long as the order was in existence, the defendants were required by law to obey it - See paragraphs 42 to 44.

Cases Noticed:

Solosky v. Canada, [1980] 1 S.C.R. 821; 30 N.R. 380, refd to. [para. 20, footnote 1].

Kopaniak v. MacLellan (2002), 159 O.A.C. 37; 212 D.L.R.(4th) 309 (C.A.), dist. [para. 22, footnote 2].

Forrest v. Lacroix Estate (2000), 133 O.A.C. 25; 48 O.R.(3d) 619 (C.A.), dist. [para. 23, footnote 3].

Bell ExpressVu Limited Partnership v. Torroni et al. (2009), 246 O.A.C. 212; 94 O.R.(3d) 614 (C.A.), refd to. [para. 24, footnote 4].

SNC-Lavalin Profac Inc. v. Sankar et al., [2009] O.A.C. Uned. 655; 94 O.R.(3d) 236 (C.A.), refd to. [para. 24, footnote 4].

Pro Swing Inc. v. Elta Golf Inc., [2006] 2 S.C.R. 612; 354 N.R. 201; 218 O.A.C. 339, refd to. [para. 24, footnote 5].

Anns v. Merton London Borough Council, [1978] A.C. 728 (H.L.), refd to. [para. 29, footnote 8].

Design Services Ltd. et al. v. Canada, [2008] 1 S.C.R. 737; 374 N.R. 77, refd to. [para. 31, footnote 9].

United Kingdom (Her Majesty's Commissioners of Customs and Excise) v. Barclays Bank plc, [2006] 4 All E.R. 256; 360 N.R. 218 (H.L.), refd to. [para. 35, footnote 10].

Counsel:

Mahmud Jamal and Adam Hirsh, for the moving parties (defendants other than Nagy);

Charles F. Scott and Daniel Naymark, for the responding party (plaintiff).

This application for leave to appeal was heard on September 30, 2010, at Toronto, Ontario, by Molloy, J., of the Ontario Divisional Court, who delivered the following endorsement on November 5, 2010.