Reagan v. CPI Crown Properties International Corporation, 2011 ABQB 315

Court of Queen ’ s Bench of Alberta Citation: Reagan v.

CPI Crown Properties International Corporation, 2011 ABQB 315 Date: 20110509 Docket: 1001 12227 Registry: Calgary Between: Barrie Reagan, Robert Bartsch, Todd Campbell, Simon Okkerse and Alex Oykhman, as members of the CPI Quotavest Investors ’ Steering Committee Applicants - and - CPI Crown Properties International Corporation, CPI Crown Capital Corporation, Crown Vista Estates Ltd., Crown Vista Estates II Ltd., Crown Vista Estates II Limited Partnership, CPI Southbend Crown Centre Inc. and CPI Southbend Crown Centre Limited Partnership Respondents _______________________________________________________ Memorandum of Decision of the Honourable Mr.

Justice G.C. Hawco _______________________________________________________ Introduction [ 1 ] On August 17, 2010, an Originating Notice was brought by the Applicants for an order against the Respondents that an investigation be made of the Respondents as to whether the Respondents had committed any fraud against the Applicants as well as other investors, that an Inspector be appointed or, in the alternative, that a Receiver be appointed, and for such as other relief as the Court may deem just.

[ 2 ] The issue, briefly, was that the Respondents, having obtained money from the Applicants and others with respect to a number of real estate investments, were not giving the Applicants financial information or access to the books and records of the various corporations and partnerships which they had agreed to do under the terms of the original offering memoranda, or under the Business Corporations Act of Alberta. [ 3 ] Both parties exchanged briefs. A hearing took place on October 1, 2010 in the morning.

In the afternoon, I issued an Order granting the Applicants access to the books and records of the Respondents and ordering the Respondents to provide access and co- operate with the Applicants. I did not order that either an Inspector or a Receiver be appointed. [ 4 ] On November 3, 2010, a hearing took place with respect to costs, resulting in an Order that the Respondents pay to the Applicants’ costs in the amount of $11,370.90. Those costs were payable in any event of the cause, but were not required to be paid forthwith. [ 5 ] The matter has now come back once again.

The Applicants seek an order declaring that the action is at an end and that the costs are now payable. [ 6 ] The Respondents argue that the Applicants must bring their application to a conclusion before costs become payable. If they choose not to do so, they should discontinue and pay the Respondents’ costs. Disposition [ 7 ] The principal issue at the original hearing was, as stated, one of access by the Applicants to the Respondents’ business and financial records. The issue throughout the months of discussions between the parties preceding the filing of the Originating Notice related to access.

The Applicants were successful in their application. An Order was granted. They are entitled to receive an order with respect to costs. The only matter which remained outstanding was whether there would be compliance by the Respondents. There obviously was. [ 8 ] As the Applicants seek nothing further, they are entitled to discontinue their action if they see fit under Rule 4.36(1). They are entitled to now seek an order to have their costs paid.

They are entitled to request that the sealing order be lifted. [ 9 ] The Respondents have resisted an Order that costs granted on November 3 now be paid as the action is still outstanding. They argue that the Order granted on October 1 was simply an Interim Order and that until all the relief sought is obtained, the matter has not concluded and that the costs therefore ought not to be payable. [ 10 ] Rule 10.29(1) provides that a successful party to an application is entitled to a cost award against the unsuccessful party and that the unsuccessful party must pay the cost forthwith.

The Court can, of course, provide otherwise. That is what was done in these proceedings. [ 11 ] For the Respondents to argue that the matter has not been concluded is simply without merit. The Respondents’ deliberate thwarting of the Applicants’ attempts for access to documents to which they were clearly permitted caused the application to be made. The Originating Notice may have been somewhat of a broad brush attack, but even then it did not succeed in convincing the Respondents to provide access.

Although an Inspector or Receiver was requested, what was being sought was access. [ 12 ] The Applicants were successful. That Order was not appealed. They no longer seek an Inspector or a Receiver. They had requested and are entitled to an Order that their costs be paid forthwith. They also seek costs with respect to this application. The original costs granted on November 3, 2010 are payable forthwith. The Applicants are entitled to the costs of this application which I set at $1,000. There is no further need or requirement that the court file be sealed and is therefore ordered to be unsealed.

Heard on the 8 th day of March, 2011. Dated at the City of Calgary, Alberta this 9 th day of May, 2011. G.C. Hawco J.C.Q.B.A. Appearances: Alexis Teasdale BENNETT JONES LLP for the Applicants C. Michael Smith SMITH MACK LAMARCH for the Respondents