



COURT OF APPEAL FOR ONTARIO

CITATION: Leggat v. Jennings, 2014 ONCA 754

DATE: 20141028

DOCKET: C58633

Feldman, Juriansz and Rouleau JJ.A.

BETWEEN

Brian Leggat and 1180330 Ontario Inc.

Plaintiff (Appellants)

and

Kelly Jennings
,
    Craig Beck,
1393024 Ontario Inc., Peninsula Motor Sales
    Limited
, 4061357 Canada Inc., 921384 Ontario Inc. D.B.A Midland Honda,
    2233361 Ontario Ltd. D.B.A. Powerband Global, Elizabeth Jennings, Brianne
    Jennings, Courtney Jennings and 2213922 Ontario Inc. D.B.A Peninsula Automotive
    Sales & Leasing

Defendants (Respondents)

AND BETWEEN

Kelly Jennings, 1393024 Ontario Inc., and Peninsula
    Motor Sales Limited

Plaintiffs

and

Brain Leggat, Doug Leggat, 1180330 Ontario Inc.,
    2095008 Ontario Inc., 2155866 Ontario Inc., Four Ways Inc. (F.K.A. 2064281
    Ontario Inc.) 952430 Ontario Inc., 4061420 Canada Inc., Leggat Pontiac Buick
    Cadillac Limited

Defendants

Shaun F. Laubman and Lauren Epstein, for the appellant

Neil Stuart Rabinovitch and Kathryn McCulloch, for the
    respondents

Heard and released orally: October 20, 2014

On appeal from the order of Justice A. Donald K.
    MacKenzie of the Superior Court of Justice, dated March 12, 2014.

ENDORSEMENT

[1]

The sale process ordered by the court was in response to the need for
    both sides to deal with the pressure from the bank that it would force the sale
    of the dealerships if it was not paid out.  They submitted the matter to the
    court as part of the oppression remedy claim.  The court accepted the
    respondents position that for sale purposes the two corporations being sold
    could no longer be parties to the litigation.  He had the power to include that
    provision as part of the sale process order.

[2]

The parties made it clear in their affidavits that their intent in
    agreeing to a sale process was that it would not affect or prejudice anyone in
    the litigation.  The appellant now says there are tax reasons why any damages
    for oppression must be paid to and flowed through the corporation and not
    directly to the plaintiffs.  They acknowledge, however, that the practical
    effect of the relevant tax consequences can be achieved by expert calculation
    without actually flowing any payment of damages through a party corporation.  It
    was clearly the intent both of the parties and of the motion judge that there
    be no effective prejudice to the litigant by this order.

[3]

The appellant also raises with the court a third party claim that has
    arisen against Peninsula after the order appealed from.  In our view, the
    parties can deal with the practical efficacies of that claim as part of trial
    management.  It does not affect the judges decision that for the purposes of
    the sale, the two corporations should no longer be parties to the main action.

[4]

The appeal is therefore dismissed with costs fixed at $10,000 inclusive
    of disbursements and HST.

K. Feldman J.A

R.G. Juriansz J.A.

Paul Rouleau J.A.


