Fairest valuation date to value common shares was date of reasons on oppression application

In action and oppression application, court considered nature of agreement between AC and CB relating to property CB owned through predecessor to 500 Ltd., which he wanted to develop. As result of agreement found to have existed, CB and AC’s company C Corp. became shareholders of 500 Ltd.. It was found that AC, through C Corp., unfairly prejudiced CB and disregarded his interests in connection with 500 Ltd.. Oppressive conduct consisted of C Corp.’s failure to discharge existing mortgage it had assumed, improper registration of second mortgage, and failure to fund half of ongoing costs of 500 Ltd.. It was ordered, inter alia, that C Corp. sell its shares in 500 Ltd. to CB. Submissions were made on outstanding issues, including how to value C Corp.’s common shares to determine sale price. It was determined that preferable approach was to direct reference to master to determine price for sale of C Corp.’s shares to CB. It was premature to determine which valuation methodology was appropriate. Master was to take all necessary steps and make all necessary inquiries. Fairest valuation date to value common shares was date of reasons on oppression application; it reflected AC’s ongoing investment into corporation and did not punish him for CB’s failure to advance project.

Bitton v. Checroune et al (2017), 2017 CarswellOnt 15276, 2017 ONSC 5542, J.T. Akbarali J. (Ont. S.C.J.); additional reasons (2017), 2017 CarswellOnt 6694, 2017 ONSC 2434, J.T. Akbarali J. (Ont. S.C.J.).