



COURT OF APPEAL FOR ONTARIO

CITATION: Wright v. Urbanek, 2019 ONCA 823

DATE: 20191017

DOCKET: C66581

Hoy A.C.J.O., van Rensburg and
    Roberts JJ.A.

BETWEEN

John
    (Jack) Wright

Plaintiff (Appellant)

and

Anne
    Urbanek
on her own behalf and as Trustee of the
    Wright Family Trust; as Trustee for the A. Urbanek Family Trust and as Estate
    Trustee for the Estate of Anne Wright,
Jacqueline Strauss
on her own behalf and as Trustee of the Wright Family Trust; as Trustee for the
    J. Strauss Family Trust and as Estate Trustee for the Estate of Anne Wright,
Anjay Limited
, Michael Tibollo, Nina Deluca Ford and
    Jean Carberry

Defendants (
Respondents
)

Gregory M. Sidlofsky and Matthew M.A.
    Stroh, for the appellant

Andrew Finkelstein, for the respondents

Heard: October 8, 2019

On
    appeal from the order of Justice Michael A. Penny of the Superior Court of
    Justice, dated January 15, 2019.

REASONS FOR DECISION

[1]

The appellant appeals the order of the motion
    judge striking his statement of claim and dismissing his action against only the
    respondents, on the basis that it was
res judicata
, a collateral
    attack on the order of Conway J., dated October 7, 2016, and an abuse of
    process. The respondents are the appellants daughters and Anjay Limited.

[2]

In his action, the appellant sought to challenge
    the validity of a family trust that was established in connection with an
    estate freeze involving Anjay Limited that the appellant and his late wife
    instituted in 2007. He argues that the motion judge erred in law, and
    unreasonably extended the application of the principles of
res judicata
,
    collateral attack and abuse of process, by considering that the appellant could
    have raised the issue of the validity of the family trust in response to his
    daughters oppression application. That application resulted in the order of
    Conway J., which, among other things, ordered that the appellant be removed as
    a trustee of the family trust and as an officer and director of Anjay, the
    preference shares of Anjay issued to him on the estate freeze be redeemed, and
    the shareholder loan he made to Anjay be repaid.

[3]

In the alternative, the appellant argues that
    the motion judge erred in principle in refusing to exercise his discretion to
    nonetheless allow his claim to proceed because the appellant has lost
    substantially all of his assets as a result of an estate freeze that he never
    understood or agreed to.

[4]

We are not persuaded that there is any basis for
    this court to interfere with the motion judges order.

[5]

As the motion judge noted:

Four days after [the appellant] lost the
    daughters oppression application, he commenced the Action. Contrary to the
    position that he asserted in the daughters oppression action, (which was a
    fight about how many preference shares in Anjay he held, whether he should be
    removed as trustee of the [family trust] and as a director and officer of Anjay
    and whether his preference shares in Anjay should or should not be redeemed),
    in the Action [the appellant] now alleges that the [family trust] is void and
    that he holds 100% of the common shares of Anjay and holds no preference
    shares.

[6]

The motion judge found that the appellant,
    having lost the daughters oppression application, sought to advance a new and
    inconsistent theory. He observed that, in the oppression application, [i]t
    was entirely open to [the appellant] to advance the position that he did not
    own any preference shares because the [family trust] was not valid.

[7]

As the motion judge observed, the appellant also
    asserted, in an application he commenced in August of 2016 alleging that his
    daughters had acted in a manner that was oppressive, that he owned preference
    shares of Anjay and was not a beneficiary of the family trust. That application
    was initially adjourned and has since been the subject of a motion to strike
    that was granted, which the respondent has separately appealed.

[8]

The doctrine of abuse of process arises out of
    the courts inherent jurisdiction to prevent misuse of the courts procedure in
    a way that would bring the administration of justice into disrepute. It is a
    flexible doctrine unencumbered by the specific requirements of concepts such as
issue estoppel:
Toronto
    (City) v. C.U.P.E., Local 79
, 2003 SCC 63, [2003] 3 S.C.R. 77, at para.
    35. One circumstance in which abuse of process has been applied is to strike
    out an action where the litigation before the court is in essence an attempt to
    relitigate a matter the court has already decided: see
Behn v. Moulton
    Contracting Ltd.
, 2013 SCC 26, [2013] 2 S.C.R. 227, at paras. 39-41;
Toronto
    (City) v. C.U.P.E., Local 79
, at paras. 35-38.

[9]

The cause of action challenging the validity of
    the family trust was known to the appellant and could have been pursued by him
    on the oppression application.  Indeed, in their reply factum on the daughters
    oppression application, the daughters noted that the appellant seemed to be
    questioning the validity of the family trust in his factum and responded to
    that assertion. The appellant ultimately did not pursue the issue before Conway
    J.

[10]

Had he done so, and satisfied Conway J. that the
    family trust was invalid, the result of the daughters oppression application
    would clearly have been different. If the family trust were invalid and the
    appellant owned no preference shares, Conway J. would not have ordered the
    redemption of the appellants preference shares. It is unclear what, if any,
    oppression remedy Conway J. would have ordered.

[11]

A challenge to the validity of the family trust
    would interfere with the implementation of Conway J.s order, which was upheld
    on appeal. Raising the issue now is tantamount to relitigating the daughters
    oppression application, which has already been decided. To do so would be to
    misuse the courts procedures in a way that would bring the administration of
    justice into disrepute.

[12]

The doctrine of abuse of process alone warranted
    striking the appellants claim and dismissing his action. Further, there is no
    basis on which to interfere with the motion judges decision not to exercise
    his residual discretion to nonetheless allow the appellants action to proceed
    against the respondents. In response to his argument that he never understood
    or agreed to the estate freeze, we note that the motion judge did not strike
    the action as against the various professional advisors who were retained to
    implement the estate freeze in 2007.

[13]

Given this conclusion, it is unnecessary for us
    to address the appellants other arguments.

[14]

The appeal is dismissed. The respondents are
    entitled to their costs of the appeal, fixed, as agreed, in the amount of $7,500,
    including HST and disbursements.

Alexandra
    Hoy A.C.J.O.

K.
    van Rensburg J.A.

L.B.
    Roberts J.A.


