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Injunctions - Undertakings. Taylor v. Freeman
In Taylor v. Freeman (Ont Div Ct, 2025) the Ontario Divisional Court allowed an appeal, this brought against an order "requiring $4,000,000 from the proceeds of sale of property owned by the appellants be paid into court, as security for the respondents’ claim for damages" in the course of Mareva injunction proceedings.
Here the court considers the 'undertaking' sometimes required for an interlocutory injunction:[23] As noted above, the test for a Mareva injunction includes an undertaking as to damages to be provided by the moving party to the court. This undertaking should be included in the order itself, including any limitations on the undertaking the court sees fit to impose. In this case, the moving party did not provide an undertaking as to damages, and the issue was not raised with the parties by the motions judge. No such undertaking was included in the order.
[24] The undertaking as to damages has been characterized as the “price” of obtaining a Mareva injunction. The court may dispense with it, but only if circumstances of the case warrant dispensing with this requirement: see for example Business Development Bank of Canada v. Aventura II Properties Inc., 2016 ONCA 300 at para.25. A court dispensing with the requirement should explain the reasons it has done so. None of that happened in this case. . Value Assets Inc. v. Downtown Brampton Development Corporation et al.
In Value Assets Inc. v. Downtown Brampton Development Corporation et al. (Ont Div Ct, 2025) the Ontario Divisional Court dismissed a motion for an interim "injunction that would stop the enforcement or applicability" of a by-law - this within a JR proceeding seeking the quashing of the by-law, a restraining order and damages.
Here the court alludes to the requirement for a damage 'undertaking' (typically a bond) by the applicant for an interlocutory injunction:[58] I find that those harms significantly outweigh the potential, unquantified loss of rental income to the applicant that might be incurred prior to the determination of this application. Moreover, a party seeking an interlocutory injunction is required to give an undertaking as to damages in the event the injunction is later found to have been unwarranted. Value Assets offers no undertaking to the City or the BIA for damages.
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