



COURT OF APPEAL FOR ONTARIO

CITATION: Buccilli v. Pillitteri, 2016 ONCA
775

DATE: 20161024

DOCKET: M46743 (C61926)

Cronk, Rouleau and Huscroft JJ.A.

BETWEEN

Patricia Buccilli and
Drapery Interiors Etc. Inc.

Moving Parties
(Plaintiffs/Respondents)

and

Pasquale Pillitteri, also known as
Pat Pillitteri, Christina Pillitteri,
Patron Contracting Limited, also known as
CDC Contracting, Birchland Homes Inc.
and Vendrain Inc.

Respondents
(Defendants/Appellants)

Thomas M. Slahta, for the moving parties

Linda Galessiere and Alex Smith, for the respondents

Heard: September 19, 2016



Rouleau J.A.:



[1]

This is a motion by the plaintiffs seeking an order to quash an appeal
by the defendants of a March 9, 2016 order of Newbould J. of the Superior Court
of Justice, wherein the defendants were ordered to make certain interim
payments to the plaintiffs pending a later trial to determine what further
remedies are available to the plaintiffs.

A.

Background

[2]

The dispute among the parties has been ongoing for some time. It is
rooted in a claim by the plaintiffs that one or more of the individual
defendants deprived the plaintiffs of their interest in various corporations,
including the defendant corporations. The claim was the subject of a
bifurcation order in 2009, whereby the court split consideration and determination
of the plaintiffs request for declarations as to their rights and the extent
of those rights from their request for remedies related to any declared rights.

[3]

The declaratory relief portion of the claim was the subject of a trial
in 2012 (the phase one trial). The judgment rendered at the phase one trial declared,
among other things, that the plaintiffs had a one-third interest in the defendants,
Patron Contracting Limited and Birchland Homes Inc., as well as in all monies,
benefits and opportunities withdrawn or diverted directly or indirectly from those
companies, including but not limited to various real estate investments:
Buccilli
v. Pillitteri
, 2012 ONSC 6624, [2012] O.J. No. 5628. That judgment was
affirmed on appeal:
Buccilli v. Pillitteri
, 2014 ONCA 432, [2014] O.J.
No. 2561.

[4]

Pending the phase two trial to determine the value of the plaintiffs
declared interests and the appropriate equitable and monetary remedies under
the
Ontario Business Corporations Act
, R.S.O. 1990, c. B.16 (OBCA),
the plaintiffs, the moving parties herein, brought a motion pursuant to s.
248(3)(j) of the OBCA and r. 20 of the
Rules of Civil Procedure
,
R.R.O. 1990, Reg. 194, seeking substantial interim payments along with other
declaratory relief. The motion judge granted much of the relief sought and,
assessing the value of the plaintiffs one-third interest in various properties
and investments, ordered the defendants to make payments totalling $6,098,427
plus the plaintiffs proportionate share of other legal expenses as that term
is defined in the order, together with costs fixed in the amount of $170,000.
[1]

[5]

The defendants have appealed that order to this court. The hearing of
that appeal is scheduled for December of this year.

B.

Basis of this motion

[6]

The moving parties now move for an order quashing the defendants appeal
for want of jurisdiction. They advance three grounds in support of their motion.

[7]

First, the moving parties argue that the order is not a final order. They
explain that the interim partial payments are with respect to properties or
investments in which the moving parties one-third interest was finally
determined by the decision in the phase one trial. The amounts ordered to be paid
were calculated using the lower of the two appraised values for each of the
properties involved, as adjusted based on the evidence filed at the hearing.
The payments, therefore, are based on the minimum amounts that will be
recovered at the phase two trial.

[8]

In the moving parties submission, because the decision and payments
ordered do not restrict the responding parties ability to raise any issue regarding
the value of the moving parties declared one-third interest and the associated
remedies at the phase two trial, the order is not final. No
lis
between the parties has been finally determined by the order under appeal.
Pursuant to s. 19(1)(b) of the
Courts of Justice Act
, R.S.O., 1990, c.
C-43, any appeal is to the Divisional Court and, although I need not determine
this issue, leave may be required.

[9]

Second, the moving parties argue that if any of the relief granted was
in fact final, it was awarded pursuant to the OBCA. Appeals from such orders,
be they final or interlocutory, are properly made to the Divisional Court
pursuant to s. 255 of the OBCA.

[10]

Finally, the moving parties argue in their factum that the appeal should
be quashed as being manifestly devoid of merit.

C.

Discussion

(1)

Is the order final?

[11]

In my view, the order under appeal by the defendants is final. That order
is not, as suggested by the moving parties, simply an order requiring the
payment of sums representing the minimum amounts that will be recovered at the
phase two trial. The order consists of a series of paragraphs, each of which
determines the moving parties entitlement to minimum set amounts for their
interest in each of several disputed properties or investments.

[12]

In some cases, the motion judge was presented with two market value
appraisals for a disputed property and he used the lower of the two. He left to
the phase two trial the final determination as to the correct market value. Significantly,
however, although he used the lower of the two appraisals as his starting point,
he then went on to determine what reductions he would or would not allow the
responding parties to make to those values because of costs they allege were,
or would be, incurred. This exercise involved the final determination of
several disputed issues, such as whether the respondents to the motion would be
allowed to claim management fees against some of the properties, and whether
the taxes that would be incurred upon the sale of the properties should be
taken into account:
Buccilli v. Pillitteri
, 2016 ONSC 1655, 264
A.C.W.S. (3d) 654, at paras. 30-33.

[13]

The respondents to the motion accept that the minimum payments ordered
are the product of several final determinations which, if not reversed on
appeal, will be binding on them at the phase two trial. In other words, they
argue that, despite being characterized as minimum amounts and recognizing that
more may well be obtained by the moving parties at the phase two trial, the fact
remains that the respondents to the motion are prevented by reason of the order
from challenging these minimum payments and arguing at the phase two trial that
the deductions the motion judge rejected ought to be accepted.

[14]

I agree. The order, therefore, is final.

[15]

I note that one paragraph in the order (para. 1) does not relate to the
moving parties one-third interest in a property and investment. This paragraph
orders the respondents to the motion to pay the moving parties proportionate
share of the legal expenses and the expenses of an accounting firm appointed by
the court. It is apparent that the payments ordered in this paragraph of the
order are also final.

(2)

Does the order constitute relief granted pursuant to the OBCA?

[16]

I turn now to the second ground advanced by the moving parties, that is,
that the relief was granted pursuant to the OBCA and that s. 255 of that Act
provides that appeals from orders made under the OBCA lie to the Divisional
Court.

[17]

The moving parties emphasize that their notice of motion invoked both
s. 248(3) of the OBCA and partial summary judgment pursuant to r. 20. Although
the motion judge did not, in his reasons, identify whether the order was made pursuant
to s. 248(3) or r. 20, the moving parties submit that, properly construed,
all the relief was awarded or could have been granted pursuant to s. 248(3). The
relevant part of s. 248(3) is as follows:

(3) In connection with an application under this
section, the court may make any interim or final order it thinks fit including,
without limiting the generality of the foregoing

(j) an order compensating an aggrieved person[.]

[18]

I will say at the outset that it is apparent even from a cursory review
of the order that the relief granted in several of the paragraphs therein was
clearly not compensation ordered in connection with an application pursuant
to s. 248(3). Arguably, none of the relief was so granted.

[19]

In my view, the critical issue to be determined is the basis of the
power pursuant to which the partial summary judgment was granted. If, as
alleged by the moving parties, the underlying source of authority for the
relief ordered is the OBCA, then the order, whether it was made pursuant to s.
248(3) or r. 20, is for appeal purposes considered to be an order made under
the OBCA. In other words, if the motion judge was exercising a power
sufficiently close to a legislative source under the OBCA, then it will be
treated as an OBCA order and it matters not whether the relief was granted pursuant
to s. 248(3) or r. 20:
Ontario (Securities Commission) v. McLaughlin
,
2009 ONCA 280, 248 O.A.C. 54, at para. 16. If, however, the source of the
authority for the order is the common law or equity, as opposed to the OBCA,
then the appeal lies properly to this court.

[20]

From my review of the phase one trial judgment, it is apparent that this
decision was rooted in a finding that the responding parties breached their
fiduciary duties and inequitably deprived the moving parties of their interests
in several corporations. The trial judge concluded that there were sufficient
grounds on which to decide in favour of the plaintiffs under each of the
doctrines of undue influence (para. 152), unconscionability (para. 172),
misrepresentation (para. 178) and breach of fiduciary duty (para. 185). The
order for an accounting of profits and for payment of one-third to the
plaintiffs was expressly framed as a remedy to make the moving parties whole
from the breach of fiduciary duty (para. 185). These are common law or equity claims.
It follows, therefore, that the relief later granted by the motion judge giving
effect to that judgment is likewise rooted in a common law or equitable claim such
as breach of fiduciary duty. The fact that the moving parties included OBCA
claims in their statement of claim and again in their motion for partial
summary judgment does not change the essential nature of their claim.

[21]

I do not, therefore, view the appeal as constituting, at its core, an appeal
under the OBCA to which s. 255 of that Act applies.

[22]

Even if I were to assume that part of the relief was grounded in an OBCA
claim and was granted pursuant to s. 248(3), this court would nonetheless have
jurisdiction to hear the appeal from all aspects of the order pursuant to s.
6(2) of the
Courts of Justice Act
. This is because those parts of the
order under appeal that are rooted in the OBCA are final orders that, although
appealable to the Divisional Court, may be joined to the appeal of the parts of
the order that are not rooted in the OBCA.

(3)

Is the appeal devoid of merit?

[23]

With respect to the final ground, that the appeal is devoid of merit,
that ground was not pressed by the moving parties in oral submissions and in my
view does not succeed. The appeal has already been scheduled for hearing later
this year and, in light of the very limited argument on the merits of the
appeal itself, I am not, on a motion, prepared to conclude that the appeal is
devoid of any merit.

D.

Conclusion

[24]

For these reasons, I would dismiss the motion and award the responding
parties their costs of the motion, fixed in the amount of $5,000, inclusive of
disbursements and applicable taxes.



Released: P.R. October 24, 2016



Paul Rouleau J.A.

I agree E.A. Cronk
J.A.

I agree Grant Huscroft
J.A.











[1]

The amount listed in the order is slightly different. This
appears due to the plaintiffs one-third interest in a $500,000 payment from
Seasonal Treasures Inc. appearing as $166,000 instead of $166,666. The motion
judge in his Endorsement valued it at $166,666 and this is the figure I have
used.



