Reynolds v. Nicholson et al., (1996) 6 O.T.C. 238 (GD)

• Judge: McIsaac, J.
• Court: Ontario Court of Justice General Division (Canada)
• Case Date: June 04, 1996
• Jurisdiction: Ontario
• Citations: (1996), 6 O.T.C. 238 (GD)

Reynolds v. Nicholson (1996), 6 O.T.C. 238 (GD)

MLB headnote and full text

Robert George Reynolds (applicant) James Wesley Nicholson and James W. Nicholson Limited (respondents)

(File No. G16812-96)

Indexed As: Reynolds v. Nicholson et al.

Ontario Court of Justice

General Division

McIsaac, J.

June 4, 1996.

Summary:

The plaintiff and defendant worked together as surveyors for over 20 years. The plaintiff owned 45% of the shares of the defendant's company. The defendant owned the remaining 55%. Their annual salaries were governed by a shareholder's agreement. In 1994, differences arose between the plaintiff and defendant. The defendant purported to "fire" the plaintiff and initially locked him out of the premises. The plaintiff claimed the defendant did so to obtain leverage in a share buyout. The plaintiff applied under s. 248(3) of the Ontario Business Corporations Act for interim relief, claiming the defendant was guilty of oppressive conduct. The plaintiff sought compensation for outstanding dividends, repayment of a shareholder's loan and salary to which he was entitled under the shareholder's agreement.

The Ontario Court (General Division) allowed the application. The plaintiff established a strong prima facie case of oppressive conduct. An actual finding of oppression was not required for interim relief. The court awarded the plaintiff $11,000 for salary owed and $2,500 for repayment of the shareholder's loan, but held that the plaintiff was not entitled to any dividends.

Company Law - Topic 2170.1

Shareholders - Shareholder's rights - Oppressive acts - Relief - Interim relief - See paragraphs 1 to 9.

Cases Noticed:

Deluce Holdings Inc. v. Air Canada (1992), 12 O.R.(3d) 131 (Gen. Div.), refd to. [para. 5].

Naneff v. Con-Crete Holdings Ltd. et al. (1995), 85 O.A.C. 29; 23 O.R.(3d) 481 (C.A.), refd to. [para. 6].

820099 Ontario Inc. v. Ballard (Harold E.) Ltd. (1991), 3 B.L.R.(2d) 113 (Ont. Gen. Div.), refd to. [para. 6].

Statutes Noticed:

Business Corporations Act, R.S.O. 1990, c. B-16, sect. 248(3)(j) [para. 4].

Counsel:

Mark Scharf, for the applicant;

David A. Morin, for the respondents.

This application was heard before McIsaac, J., of the Ontario Court (General Division), whose following judgment was released on June 4, 1996.