



COURT OF APPEAL FOR ONTARIO

CITATION: Tam v. El-Hawary, 2018 ONCA 70

DATE: 20180126

DOCKET: C63865

Laskin, Sharpe and Fairburn JJ.A.

BETWEEN

Stanley
    Tam aka Stanley Bor Tam, 1202817 Ontario Inc.,

RTM Resources Inc. and
    1041376 Ontario Inc.

Appellant (Defendant)

and

Nahed El-Hawary

Respondent (Plaintiff)

Martin Diegel, for the appellant

Jean-François Laberge, for the respondent

Heard and released orally: January 22, 2018

On appeal from the judgment of Justice Lynn Ratushny of
    the Superior Court of Justice, dated April 28, 2017.

REASONS FOR DECISION

[1]

The appellants concede that the motion judge did not err in finding that
    Tam and the pharmacy, 1202827 Ontario Inc. (120) are liable. The appellants
    argue, however, that the motion judge did err in finding that the landlord, 1041376
    Ontario Inc. (104), and RTM Resources Inc. are also liable.

[2]

The appellants make two submissions. First, the statement of claim
    pleads that these defendants are liable because they intended to defeat the
    respondents claim, and yet the motion judge held that the question of intent
    could not be decided until after a trial. Second, the respondent pleaded that
    104 and RTM were liable as affiliates, and yet she led no evidence to show that
    they were affiliates.

[3]

We do not agree with the appellants argument. On the pleadings point,
    once the appellants concede that Tam and 120 are liable, they concede that
    under the oppression remedy it is effect not intent that matters, as indeed the
    motion judge found.

[4]

On the affiliates point, we are satisfied that the motion judges
    reasons are sufficient to support a finding that both 104 and RTM are
    affiliates. Under section 1(4) of the
Ontario Business Corporations Act
,
    one body corporate shall be deemed to be affiliated with another body corporate
    if each of them is controlled by the same person. In para. 3 of her reasons,
    the motion judge found:

The defendant Mr. Tam has been the sole director and sole
    shareholder of the Pharmacy since June 2011. He is also the sole director of
    the defendant 1041376 Ontario Inc. (104), one of the directors of the
    defendant RTM Resources Inc. (RTM) and he agreed during an examination in aid
    of execution that RTM is a company he controls. He said in that examination
    that he is also a shareholder of 104 and RTM, although the Pharmacys corporate
    tax returns for the taxation years 2013 and 2014 appear to suggest it is the
    Pharmacy that owns 100% of the common shares for 104 and RTM and not Mr. Tam.

[5]

And then in para. 59, the motion judge also found:

I conclude by finding that the actions or omissions of Mr. Tam,
    as director of the Pharmacy and as the controlling mind of the other
    defendants, were unfairly prejudicial and unfairly disregarded the interests of
    the plaintiff.

[6]

These findings are buttressed by the timing of the transfers between the
    various companies, which were virtually instantaneous.

[7]

For these brief reasons the appeal is dismissed, with costs to the
    respondent in the amount of $15,000, inclusive of disbursements and HST.

John
    Laskin J.A

Robert
    J. Sharpe J.A

Fairburn
    J.A.


