Cimmer v Niessner, 2022 SKCA 60

Court of Appeal for Saskatchewan Docket: CACV3081 and CACV3399 Citation: Cimmer v Niessner , 2022 SKCA 60 Date: 2022-05-18 Between: Timothy Cimmer Appellant (Defendant) And Charles Niessner and Madelyn Niessner Respondents (Plaintiffs) And Keeley Lake Lodge

(1989) Ltd., Benjamin Partyka, Thomas McKenzie, Wes Bousquet and Weskar Holdings Ltd. Non-Parties (Defendants) Before: Jackson, Ryan-Froslie and Tholl JJ.A. Disposition: Appeal in CACV3081 dismissed; appeal in CACV3399 allowed Written reasons by: The Honourable Mr. Justice Tholl In concurrence: The Honourable Madam Justice Jackson The Honourable Madam Justice Ryan-Froslie On appeal from: QBG 859 of 2016, Saskatoon Appeal heard: March 10, 2022 Counsel: Timothy Cimmer on his own behalf (CACV3081) E.F.

Anthony Merchant, Q.C., for the Appellant (CACV3399) Grant Scharfstein, Q.C., for the Respondents (CACV3081, CACV3399) Tholl J.A. I. INTRODUCTION [ 1 ] Timothy Cimmer asserts ownership of or, at least, a security interest in the majority of the shares of a Saskatchewan corporation, Keeley Lake Lodge

(1989) Ltd. [Corporation], arising out of contractual arrangements with a New Jersey resident, Richard Lunemann. Charles Niessner and Madelyn Niessner dispute that claim. Litigation ensued in New Jersey and Saskatchewan involving them and other parties. In March of 2017, Mr. Cimmer brought an application in the Court of Queen’s Bench for Saskatchewan, seeking an anti- suit injunction that would restrain the Niessners from continuing their action in New Jersey. That application was dismissed.

In November of 2018, the Niessners brought an application in the Court of Queen’s Bench for Saskatchewan and successfully obtained an injunction prohibiting Mr. Cimmer from taking steps to dispose of the shares of the Corporation that he purports to own. Mr. Cimmer appealed both of the decisions, but did not move either appeal forward with any dispatch. [ 2 ] For the reasons that follow, I would dismiss the appeal in relation to the anti-suit injunction but allow the appeal with regard to the order prohibiting the sale of the shares. II. BACKGROUND [ 3 ] The following

summary provides a brief outline for the purposes of context and is not meant to be an exhaustive canvassing of the facts. The evidence reveals numerous other steps and communications that occurred, which will be referred to as required during my analysis. [ 4 ] The Corporation was incorporated in Saskatchewan in 1988, with its registered office in Meadow Lake. Its primary asset is a hunting and fishing lodge located at Keeley Lake, Saskatchewan [Lodge]. One hundred Class A common voting shares were issued by the Corporation. In 1989, Mr. Niessner became the owner of all of those shares. He and Ms.

Niessner (his spouse), currently reside in Wisconsin. They had resided in New Jersey at one point. [ 5 ] Mr. Lunemann is a New Jersey resident who is an acquaintance of the Niessners. His involvement with the operation of the Lodge related to the marketing of its services and amenities to American hunters and acting as a hunting guide. The Corporation maintained bank accounts in New Jersey to process payments from American customers. [ 6 ] In 1998, Mr. Lunemann encountered some immigration difficulties that interfered with his ability to act as a hunting guide at the Lodge.

As a result, he entered into an agreement to purchase stock [APS] with Mr. Niessner. The APS, which was executed in 1998, was backdated to June 1, 1990. It purported to transfer 60 of the Class A shares in the Corporation from Mr. Niessner to Mr. Lunemann. By way of a corresponding promissory note, Mr. Lunemann promised to pay Mr. Niessner $60,000 for the shares. A handwritten

schedule recorded payments made through services rendered by Mr. Lunemann from October of 1991 to December of 1997. According to the handwritten notations, which were initialled by Mr. Niessner, this resulted in the entire amount being paid off by the end of December of 1997. Ms. Niessner deposed that the APS was prepared in order to permit Mr. Lunemann to deal with the immigration issues and did not

reflect the true ownership of the shares. [ 7 ] There was no change in the status of the directors or officers as a result of the APS. However, after the APS was entered into, the Corporation reported Mr. Niessner as the owner of 40 Class A shares and Mr. Lunemann as the owner of the other 60 shares in its own records and in its filings with the Saskatchewan Corporations Branch and, subsequently, with the Information Services Corporation. A share certificate was issued by the Corporation that indicated Mr. Lunemann was the owner of 60 Class A shares.

Wes Bousquet, a Saskatchewan resident, was the sole director of the Corporation and Mr. Niessner was the president. [ 8 ] Disputes arose between Mr. Lunemann and the Niessners, resulting in the Niessners and the Corporation commencing an action against Mr. Lunemann in the New Jersey Superior Court on September 17, 2015. The action involved a dispute about the 60 shares but also dealt with several other matters, including loans and rental property situated in New Jersey. Among other things, Mr. Niessner sought an order that the 60 Class A shares be transferred back into his name.

In his answer and counterclaim in New Jersey, Mr. Lunemann agreed that the APS was a sham and pleaded that it was not enforceable. He maintained that the entries in the Saskatchewan public records did not accurately reflect the true ownership of the shares of the Corporation. [ 9 ] Mr. Cimmer is a resident of Saskatchewan and an acquaintance of Mr. Lunemann. Mr. Cimmer became aware of the New Jersey action and entered into an arrangement with Mr. Lunemann regarding the 60 shares he purportedly owned.

The written agreements consisted of a share option agreement [SOA] and a demand loan agreement [DLA], which have an effective date of December 11, 2015. In general, under the DLA, Mr. Cimmer agreed to lend Mr. Lunemann money for his legal fees associated with the New Jersey action and Mr. Lunemann granted a security interest in the 60 Class A shares to Mr. Cimmer. Under the SOA, Mr. Lunemann granted Mr. Cimmer an irrevocable option to purchase the 60 shares for a set price, with the loan under the DLA being forgiven as payment for the shares and any remaining amounts reconciled between the two parties at the end.

Mr. Cimmer then paid the retainer for Mr. Lunemann’s counsel and executed a guarantee with regard to legal fees associated with the New Jersey action. In his affidavit, Mr. Lunemann averred that Mr. Cimmer was aware of the problems associated with his purported ownership of the 60 shares in the Corporation. [ 10 ] Mr. Niessner was removed as an officer of the Corporation in December of 2015. He alleges this was done without notice, with the assistance of Mr. Cimmer and in contravention of the fiduciary duties of the sole director, Mr.

Bousquet. [ 11 ] A shareholders meeting was held on January 21, 2016, over the objections of Mr. Niessner and in his absence, at which Mr. Bousquet, Mr. Cimmer and a third individual were named as directors of the Corporation and Mr. Niessner was removed. Mr. Niessner alleges he was then effectively frozen out of the Corporation. [ 12 ] On April 20, 2016, the Niessners commenced an action in the Court of Queen’s Bench for Saskatchewan against the Corporation, Mr. Lunemann, Mr. Cimmer and four other defendants. This matter was originally opened in the judicial centre of Regina as QBG 921 of 2016.

It was later transferred to the judicial centre of Saskatoon as QBG 859 of 2016. The Niessners claim remedies for oppression and conspiracy. They allege, inter alia , that Mr. Niessner is the beneficial owner of the 60 Class A shares in the Corporation that were registered to Mr. Lunemann and that Mr. Lunemann held them in trust for him. In paragraph 40 of the claim, the Niessners state that they were seeking to have the shares transferred into Mr. Niessner’s name in the New Jersey action. The claim also alleges that Mr.

Cimmer’s funding of the New Jersey litigation was part of his complex scheme designed to enable him to obtain the 60 shares at well below market value. [ 13 ] On July 29, 2016, at the conclusion of mediation in the Superior Court of New Jersey, Mr. Lunemann, the Niessners and the Corporation entered into a memorandum of settlement [MOS] that purported to resolve the New Jersey action. It is a comprehensive and detailed handwritten agreement. Under one of the terms of the MOS, Mr. Lunemann agreed that the Corporation would redeem and retire 30 of his Class A shares, leaving Mr.

Niessner with a majority ownership (40 of the 70 Class A shares representing a little over 57% of the voting shares). The Niessners had knowledge of the existence of the DLA and the SOA when they entered into the MOS. There is a dispute as to whether authority was properly obtained from the Corporation to enter into this settlement. There was no approval from its contested board of directors to settle the matter. [ 14 ] On July 30, 2016, Mr. Lunemann informed Mr. Cimmer of the terms of the MOS. On August 1 or 4, 2016, in response to being informed of the MOS, Mr. Cimmer’s counsel provided Mr.

Lunemann with a notice under the SOA demanding that Mr. Lunemann transfer the 60 shares to Mr. Cimmer. He subsequently sent Mr. Lunemann a transfer of shares [TOS] document and asked him to sign it. The first draft of the TOS indicated that Mr. Lunemann was transferring his “sixty

(60) Class ‘A’ shares” to Mr. Cimmer. The TOS was changed before it was signed – at Mr. Lunemann’s request, according to his affidavit – to delete the reference to 60 shares and to replace the specific number with “all of the undersigned’s shares”. Mr. Lunemann then signed the amended TOS on August 7, 2016. In his affidavit, Mr. Lunemann averred that he believed he was transferring only the shares he now owned pursuant to the MOS, i.e., 30 Class A shares. Mr. Lunemann signed the TOS without legal advice. He asserts that it was promptly repudiated once his New Jersey counsel became aware of it. [ 15 ] Mr.

Lunemann averred that Mr. Cimmer and his counsel “filed [the TOS] with Canadian authorities, falsely claiming that the document represented the transfer of 60 shares of the [Corporation’s] capital stock when they knew it did not”. I note that the corporate profile report, dated November 23, 2016, shows Mr. Cimmer as the owner of the 60 disputed shares. [ 16 ] On September 19, 2016, the Corporation purported to appoint new counsel to act on its behalf in the New Jersey action. The other two directors of the Corporation resigned on that same date, leaving Mr. Cimmer as the sole director.

The propriety of his appointment remains contested. On September 21, 2016, the Superior Court of New Jersey refused to permit the new lawyers appointed by the Corporation to act on its behalf. Instead, it granted an order impounding the 60 Class A shares of the Corporation, taking possession of the shares, and appointing James Gruccio as the Superior Court’s custodial receiver of the disputed shares. That order has not been registered in Saskatchewan. In addition, the New Jersey court ordered the following: 7.

That the Custodial Receiver shall execute his duties as such so as to preserve the status quo of the [Corporation], while the dispute over the ownership of the Disputed Shares is fully and finally adjudicated in this Court, and to otherwise protect the res of this dispute and that is the rightful ownership of the Disputed Shares[.]

[ 17 ] The most recent corporate profile report for the Corporation contained in the evidence is dated November 28, 2016. It shows Mr. Niessner as the owner of 40 of the Class A shares and James J. Gruccio, Esquire, court-appointed custodial receiver, with a New Jersey address, as the owner of the other 60 shares. [ 18 ] Mr. Cimmer commenced a separate action in the Court of Queen’s Bench for Saskatchewan against Mr. Lunemann and his New Jersey lawyer on September 9, 2016: QBG 1211 of 2016. One of the forms of relief he sought was an order declaring that Mr.

Lunemann had the legal status and capacity to sell the 60 Class A shares to him. The Niessners were not named as parties. This action is not the subject of either appeal, but its existence assists in appreciating the overall circumstances. [ 19 ] On October 14, 2016, the Niessners amended their pleadings in the New Jersey action to name Mr. Cimmer, among others, as a defendant. Mr. Cimmer filed an application in the Superior Court of New Jersey seeking an order dismissing the claim against him for lack of jurisdiction. His application was dismissed on February 7, 2017.

His motion for reconsideration of that decision was dismissed on March 30, 2017. The remaining issues were put on track for trial in New Jersey. Mr. Cimmer subsequently filed a counterclaim in the New Jersey action. [ 20 ] The Niessners discontinued their action as against Mr. Lunemann in QBG 859 of 2016 on December 2, 2016. [ 21 ] On March 13, 2017, Mr. Cimmer filed an application with the Court of Queen’s Bench in QBG 859 of 2016, seeking an order restraining the Niessners from continuing their action in New Jersey.

This application for an anti-suit injunction was dismissed by the Chambers judge on May 5, 2017: Niessner v Keeley Lake Lodge

(1989) Ltd. (5 May 2017) Saskatoon, QBG 859 of 2016 (Sask) [ May 5 Fiat ]. [ 22 ] On May 8, 2017, and June 16, 2017, the Superior Court of New Jersey made determinations regarding Mr. Cimmer’s interests in the 60 Class A shares of the Corporation. The following excerpt from the June 16, 2017, order of Famular P.J.Ch. captures the relevant portions of those determinations: 2.

Consistent with the May 8th Order and for greater certainty with respect to all of the parties’ rights and obligations, it is hereby ORDERED and ADJUDGED that the Share Option Agreement, dated December 11, 2015, (the “Option Agreement”) executed by Lunemann and Cimmer, which purported to give Cimmer the option to purchase 60 Class “A” Shares in the Lodge (the “Disputed Shares”) be and is hereby DECLARED null and void ab initio .

Accordingly, it is hereby ORDERED and ADJUDGED that Cimmer has no right, title, or interest in any of the Lodge’s issued and outstanding shares, including but not limited to the Disputed Shares, and that Cimmer be and is hereby ORDERED and DIRECTED to destroy any and all share certificates for the Lodge in his possession, custody or control. 3.

Cimmer is further ORDERED and PERMANENTLY ENJOINED from asserting any and all claims arising under, or relating to the Option Agreement, against Lunemann or the Niessner Parties in any court or tribunal of competent jurisdiction, including, but not limited to, either the courts in New Jersey or Canada. 4. Cimmer is further ORDERED to CEASE AND DESIST from claiming any right, title, or interest in any of the Lodge’s issued and outstanding shares, or from otherwise taking any action that is contrary to this Order. [ 23 ] On March 7, 2018, Mr. Cimmer applied for an order in QBG 1211 of 2016 declaring Mr.

Lunemann to have been the registered owner of the 60 shares as of December 11, 2015. He did not provide notice of his application to the Niessners. The application came to their attention and they applied for intervenor status, which was granted. On August 28, 2018, Danyliuk J. dismissed Mr. Cimmer’s application and indicated that it was an issue that needed to be determined at trial. [ 24 ] On October 29, 2018, Mr. Cimmer’s counsel served a notice of intention to dispose of collateral [Notice] on the Niessners’ counsel. In general, the Notice claims an amount of $1,130,988.82 is owed by Mr. Lunemann to Mr.

Cimmer, states that Mr. Cimmer holds a security interest in the 60 Class A shares that secures that debt and indicates that the shares will be sold by public sale on November 30, 2018, unless redemption or reinstatement occurs. In response, the Niessners applied to the Court of Queen’s Bench on November 14, 2018, seeking an order prohibiting Mr. Cimmer from proceeding with the sale as contemplated in the Notice. Mr. Cimmer agreed to postpone the sale of the shares until the Niessners’ application was heard. [ 25 ] On November 2, 2018, the Superior Court of New Jersey issued an order temporarily enjoining Mr.

Cimmer from disposing of the shares of the Corporation, pending a show cause hearing. On November 16, 2018, Famular P.J.Ch. issued, in part, the following order: 2. That the Niessners, Cimmer and Defendant/Counterclaimant/Cross-Claimant Richard Lunemann (“Lunemann”) be PRELIMINARILY ENJOINED AND RESTRAINED from selling, transferring, or otherwise disposing of, or attempting to sell, transfer or otherwise dispose of any shares in the Lodge; 3.

That, until further Order of the Court, Cimmer is PRELIMINARILY ENJOINED AND RESTRAINED from proceeding with the sale of the 60 Class “A” shares in the Lodge as set forth in the Notice of Intention to Dispose of Collateral … . [ 26 ] On February 27, 2019, a Court of Queen’s Bench Chambers judge granted an injunction prohibiting Mr. Cimmer from selling the shares pursuant to the Notice, pending determination by the court of the ownership of the shares or further court order. [ 27 ] It was common ground among the parties that a full trial has now occurred in the New Jersey action in which Mr.

Cimmer was represented by counsel and testified. It was also agreed in submissions that judgment has been rendered by the Superior Court of New Jersey, the judgment was appealed by Mr. Cimmer, the appeal has been argued and the decision in that appeal remains reserved as of the date of the argument of the appeals at hand. III. CHAMBERS DECISIONS

A. Anti-suit injunction [28] On March 13, 2017, Mr. Cimmer filed an application with the Court of Queen’s Bench in QBG 859 of 2016, pursuant to s. 65of The Queen’s Bench Act, 1998, SS 1998, c Q-1.01, and Rule 6-41 of The Queen’s Bench Rules. He sought the following relief: 1. An order … a.

Restraining the Plaintiffs, Charles Niessner and Madelyn Niessner, their agents, and any person acting under their instructions orcontrol, from proceedings with or in any way taking any steps to pursue their civil action in the Superior Court of New Jersey, ChanceryDivision, Camden County, Docket Number: L-3587-15[.] [29] In addition to the application for an anti-suit injunction, the Chambers judge had two other issues to determine that arose underother applications. The orders resulting from those applications are not under appeal and will be omitted from my

summary of thedecision. [30] In his May 5 Fiat (under appeal in this Court in file CACV3081), the Chambers judge described the issues, reviewed thebackground facts and dealt with the other applications. He then turned to a consideration of the anti-suit application.

The Chambers judgereferred to s. 65 of The Queen’s Bench Act, 1998, and then reviewed the principles applicable to the application as detailed in AmchemProducts Incorporated v British Columbia (Workers’ Compensation Board), (SCC), [1993] 1 SCR 897 [Amchem];Bell’O International LLC v Flooring and Lumber Co. (2001), 11 CPC (5th) 327 (WL) (Ont Sup Ct) [Bell’O]; EPI Environmental ProductsInc. v Baciu, 2012 BCSC 500; and Hudon v Geos Language Corp. (1997), (ON SC), 100 OAC 336 (Ont SC). [31] After extensively quoting the principles from Amchem and Bell’O, the Chambers judge set out the remainder of his reasons forrefusing to grant the injunction: [54] In the case of EPI Environmental Products Inc. v Baciu, 2012 BCSC 500, the Supreme Court was also called upon to consider issuessurrounding a granting of an anti-suit injunction.

In assessing the anti-suit injunction, the Court stated: [33] The Supreme Court of Canada admonished in Amchem that great caution should be exercised before invoking the power to enjoinforeign litigation through an anti-suit injunction. … [55] In this case, the injunction is being sought after a settlement in the New Jersey action was arrived at and after the court in that statedismissed Cimmer’s request for a rehearing.

A settlement of the foreign action was not a factor at play in the cases relied upon by counselfor Cimmer, being Amchem, Bell’O, and Hudon v Geos Language Corp. (1997), (ON SC), 34 OR (3rd) 14 (Ont Ct J). [56] The facts of this case appear to indicate that Cimmer was aware of the New Jersey action from the outset or at least since December2015 and yet failed to take any

part in the New Jersey action until after a settlement of that action was achieved on July 29, 2016. Havingfailed to take any

part in the action, he may be said to have acquiesced in the settlement. [57] Furthermore, as Cimmer did not take any steps to exercise his option to purchase the 60 shares until after the date of settlement, hemay also be taken to have done so with full knowledge of the results of the settlement. One of the results of the settlement was thatLunemann no longer owned 60 shares of capital stock of the Company but, rather, only 30 shares. [58] Accordingly, I exercise my discretion not to order an anti-suit injunction at this time. B.

Injunction prohibiting the sale of shares [32] On November 14, 2018, the Niessners applied to the Court of Queen’s Bench pursuant to Rules 4-6 to 4-9 of The Queen’sBench Rules and s. 63 of The Personal Property Security Act, 1993, SS 1993, c P-6.2 [PPSA].

They sought the following relief: “An orderprohibiting Timothy Cimmer (‘Cimmer’) from proceeding with the sale of Keely Lake shares pursuant to a Notice of Intention to Disposeof Collateral dated October 29, 2018 (the ‘Notice’)”. [33] The Chambers judge, as case management judge, was the same judge who heard the application that is the subject of the otherappeal dealt with in this judgment. [34] In his February 27, 2019 fiat (under appeal in this Court in file CACV3399), the Chambers judge referred to the background setout in his May 5 Fiat and supplemented it with additional events that had occurred since that date: Niessner v Cimmer (27 February 2019)Saskatoon, QBG 859 of 2016 (Sask) [2019 Fiat].

He described the positions of the parties and then dealt with the issues. The Chambersjudge first addressed Mr. Cimmer’s objection to the Niessners’ standing to bring the application. Mr. Cimmer had asserted that theNiessners had admitted, through their settlement in the New Jersey matter, that Mr. Lunemann was the beneficial and legal owner of the60 shares. The Chambers judge observed that the New Jersey court had found that the APS was a sham and that Mr. Lunemann had nointerest in the shares. The Chambers judge recognized that this determination was still subject to appeal by Mr.

Cimmer, but stated thefollowing about the New Jersey judgment: [17] Although the judgment in the New Jersey action has not yet been registered in Saskatchewan, many of the issues in the New Jerseyaction are the same as those outstanding in the two Saskatchewan actions being QBG 859 of 2016 and QBG 1211 of 2016, Judicial Centreof Saskatoon. If the New Jersey judgment is registered in Saskatchewan, Cimmer would have no interest in the shares of Keeley LakeLodge, and [Mr.

Niessner] would be the sole owner of Keeley Lake Lodge. [35] Turning to s. 63 of the PPSA, the Chambers judge framed the standing issue as a question of whether the Niessners had aninterest in the shares within the meaning of that section. He referenced Rocky Meadows Transport Ltd. v Double D Construction Ltd.,2000 SKCA 19, 16 CBR (4th) 271, and Andrews and Trotchie v Mack Financial (Canada) Ltd. (1987), (SK CA), 46DLR (4th) 731 (Sask CA) [Andrews]. Having referred to these authorities, he concluded that he was satisfied that the Niessners had

demonstrated that he had the power to grant the injunctive relief that they had requested and that there was a need to do so. [36] After clarifying that it was a temporary injunction that he was considering, and not a permanent one, the Chambers judge setout the three-part test from RJR-MacDonald Inc. v Canada (Attorney General), (SCC), [1994] 1 SCR 311 [RJR-MacDonald]: (

a) serious issue to be tried; (

b) irreparable harm; and (

c) balance of convenience. He further referenced Mosaic Potash Esterhazy Limited Partnership v Potash Corporation of Saskatchewan Inc., 2011 SKCA 120, 341DLR (4th) 407 [Mosaic Potash], for the principle that these three factors provide a framework to assess a particular case, but the ultimatefocus must be the justice and equity of the situation. [37] The Chambers judge analyzed the three factors and concluded that the injunction should be granted. His reasons for doing soare as follows (2019 Fiat): 1.

Is there a serious issue to be tried? [26] In the current case, the New Jersey Court Action has proceeded to trial. Evidence was led which enabled the trial judge to make afinding that the share option agreement of December 11, 2015, was null and void ab initio and that Cimmer had no right, title or interest inany of the issued and outstanding Keeley Lake Shares.

While the New Jersey action may be under appeal and while the New Jerseycourt’s order will not be binding in Saskatchewan unless and until it is registered under The Reciprocal Enforcement of Judgments Act,1996, SS 1996, c R-3.1, it provides strong evidence that there is a serious issue to be tried in this action. The Saskatchewan action (QBG859 of 2016, Judicial Centre of Saskatoon) also has this issue to be determined. Therefore, the Niessners have met the first part of the testfor an injunction, being a serious issue to be tried. 2.

Can the applicant establish irreparable harm? [27] In this case, I am satisfied the Niessners have established that unless there is an injunction granted, they will lose control of KeeleyLake Lodge by virtue of the fact that [Mr. Niessner] originally owned all of the 100 issued shares in Keeley Lake Lodge, but if Cimmer’sposition was accepted, Charles could now be said to own only 40. Without control of the company, the company could be sold and/orotherwise compromised. Damages may not then be an adequate remedy. The second part of the inquiry has therefore been met. 3.

What is the balance of convenience? [28] Neither party has filed any material to address this issue. The Niessners submit that any sale of the 60 shares will only serve tocomplicate the existing litigation, which is already complicated enough. Any purchaser of the shares would have no informationconcerning the outstanding issues or even that the shares ownership is disputed. However, Cimmer has filed no material indicating why hewishes to sell the shares or that he would suffer any loss if he is not allowed to proceed with the sale at this time.

I am satisfied that thebalance of convenience favours the Niessners. 4. Is an injunction warranted? [29] I am satisfied that the status quo must be preserved until such time as the ownership of the shares has finally been determined either inthis action or by registration of the New Jersey order in Saskatchewan pursuant to The Reciprocal Enforcement of Judgments Act. Aninterim injunction is warranted. IV. ISSUES [38] The issues in CACV3081, the anti-suit injunction appeal, can be described as follows: (

a) Is the appeal moot? If the appeal is moot, should it be heard in any event? (

b) If the appeal is heard, did the Chambers judge err in his application of the principles related to the granting of an anti-suitinjunction? [39] The issues in CACV3399, the appeal from the order restraining the sale of the shares, are as follows: (

a) Should the Chambers judge have dismissed the application as a result of Mr. Niessner’s unclean hands? (

b) Did the Chambers judge err by taking notice of the New Jersey proceedings? (

c) Did the Chambers judge err in finding the Niessners had standing under s. 63 of the PPSA? (

d) Did the Chambers judge err in his application of the test for granting the injunction? V. ANALYSIS A. Anti-suit injunction – CACV3081

1. Nature of an anti-suit injunction [40] An anti-suit injunction is an uncommon remedy. It restrains a person from continuing a proceeding in another jurisdiction. Itdoes not bind the courts in other jurisdictions; it binds the person who is the subject of the order. [41] The authority for granting an anti-suit injunction is found in s. 65 of The Queen’s Bench Act, 1998: Interlocutory mandamus, injunction or appointment of receiver 65(1) A judge may, on an interlocutory application, grant a mandamus or an injunction or appoint a receiver where it appears to the judgeto be appropriate or convenient that the order should be made.

(2) An order pursuant to subsection (1) may be made unconditionally or on any terms and conditions that the judge considers appropriate. [42] The leading case on anti-suit injunctions is Amchem. The exercise to be undertaken in considering such an application, as setout by Sopinka J. in Amchem, is well summarized by Nordheimer J. in Bell’O: [8] … in Amchem … Mr. Justice Sopinka adopted the principles set out in the Privy Council’s decision in SNI Aérospatiale v. Lee Kui Jak,[1987] 3 All E.R. 510 (P.C.) as forming the basis for any consideration of a motion for an anti-suit injunction.

The principles in SNI, asstated by Lord Goff at p. 519, and as quoted by Sopinka J. are: First, the jurisdiction is to be exercised when the ‘ends of justice’ require it … Second, where the court decides to grant an injunctionrestraining proceedings in a foreign court, its order is directed not against the foreign court but against the parties so proceeding orthreatening to proceed … Third, it follows that an injunction will only be issued restraining a party who is amenable to the jurisdiction ofthe court against whom an injunction will be an effective remedy … Fourth, it has been emphasised on many occasions that, since such anorder indirectly affects the foreign court, the jurisdiction is one which must be exercised with caution … [9] Mr.

Justice Sopinka then proceeded from those principles to set out the test to be applied in Canada for the granting of suchinjunctions which I summarize as follows: (

a) As a general rule, the domestic court should not entertain an application for an injunction if there is no foreign proceedingpending. (

b) It is preferable that the decision of the foreign court not be pre-empted until a proceeding has been launched in that court and theapplicant for the injunction in the domestic court has sought from the foreign court a stay or other termination of the foreign proceedingsand has failed. (

c) If the applicant has so failed, then the domestic court must proceed to entertain the application for an injunction but only if it isalleged that the domestic court is the most appropriate forum and the domestic court is in fact a potentially appropriate forum. (

d) In determining whether the domestic court is the appropriate forum, it must be determined whether the domestic forum is thenatural forum, that is the forum that on the basis of relevant factors has the closest connection with the action and the parties, and it mustalso be determined that there is no other forum that is clearly more appropriate. (

e) The domestic court must then consider any injustice to the defendant if the plaintiff is allowed to pursue the foreign proceedingand must also consider any injustice to the plaintiff if the plaintiff is not allowed to do so. In general, the court will not grant an injunctionif, by doing so, it will deprive the plaintiff of advantages in the foreign court of which it would be unjust to deprive him. [43] An anti-suit injunction is extraordinary relief. A court must apply great caution in exercising its jurisdiction to grant such anorder: Amchem at 924–926, 928 and 930. 2. Positions of the parties [44] Mr.

Cimmer averred that it is very inconvenient and expensive to engage legal counsel in two jurisdictions and to mount adefence in actions commenced by the Niessners in two separate courts. He unsuccessfully challenged the jurisdiction of the Superior Courtof New Jersey. As a result, he applied for the anti-suit injunction in the Court of Queen’s Bench. On appeal, he asserts that the Chambersjudge set out the correct test for determining whether such an order should be granted but failed to apply that test to the facts of the matterbefore him. Mr.

Cimmer asserts that the Chambers judge focussed entirely on the settlement that had been reached in New Jersey anderroneously found that he had acquiesced to it. The Niessners contend that the test was properly applied but argue that, in any event, thisappeal is now moot and should be dismissed. Mr. Cimmer does not agree that it is moot. 3. Mootness of the appeal [45] Courts are reluctant to hear matters that are moot. A matter, or an issue, is moot if its determination does not resolve a currentdispute or affect the actual rights of the parties.

A court will be hesitant to decide an issue that raises only a hypothetical or abstractquestion. There must be a live controversy or a concrete dispute upon which a determination by the court can result in a practical effect.Otherwise, mootness arises. However, despite an issue being moot, a court may still exercise its discretion and hear the matter.

Theseprinciples are set out in Borowski v Canada (Attorney General), (SCC), [1989] 1 SCR 342 at 353 [Borowski]; PrinceAlbert Right to Life Association v Prince Albert (City), 2020 SKCA 96 at paras 45–47, [2020] 10 WWR 603 [Prince Albert]; and Dubois vSaskatchewan, 2022 SKCA 15 at paras 53–55. [46] It is important to look specifically at the terms of the order that Mr. Cimmer sought in the Court of Queen’s Bench.

He askedfor an order restraining the Niessners “from proceeding with or in any way taking any steps to pursue their civil action in the SuperiorCourt of New Jersey, Chancery Division, Camden County, Docket Number: L-3587-15”. After examining the narrow focus of that

request, it is my view that there is nothing to be accomplished if the order were to now be granted. There are no proceedings left in the Superior Court of New Jersey to restrain the Niessners from continuing because the New Jersey proceedings have terminated with a judgment. On the other hand, if the order was meant to apply more broadly to any court action in New Jersey, including appeals and enforcement efforts, the consequences of such an order would be vague and undefined. Would, for example, the Niessners be prohibited from responding to a further appeal by Mr.

Cimmer if he were to be unsuccessful in the current one that is under reserve in New Jersey? Would the Niessners be prohibited from attempting a further appeal if they were to lose the appeal in New Jersey? Would the Niessners be prevented from taking enforcement efforts if they remain successful after all avenues of appeal are exhausted? Given this potential uncertainty, and the strict

interpretation that should be applied to injunction requests, I cannot read the application as being any wider than it was framed by Mr. Cimmer. As such, there are no proceedings left in which the Niessners could be restrained. [ 47 ] Mootness arose because Mr. Cimmer did not diligently pursue this appeal. The Chambers judge rendered his decision on May 5, 2017, and Mr. Cimmer filed his notice of appeal on June 2, 2017. At that point, the proceedings in the Superior Court of New Jersey were still active. Close to five years passed before this appeal was heard. At no point did Mr.

Cimmer attempt to move the matter along with any dispatch or prosecute his appeal in a manner that demonstrated there was any urgency in restraining the Niessners from continuing their action. Concurrent with that inaction, there was a flurry of activity in New Jersey. A full trial occurred in New Jersey in which Mr. Cimmer actively participated. The question we are now being asked to resolve has been overtaken by these post-decision events. These circumstances have eliminated any effect that could arise out of the granting of the anti-suit injunction requested by Mr. Cimmer.

The order could not affect the rights of the parties because the proceedings in the Superior Court of New Jersey have concluded. This appeal is moot. [ 48 ] Having determined that the appeal is moot, I must examine whether this Court should exercise its discretion and hear the appeal in any event. The task to be undertaken in this regard was discussed by Sopinka J. in Borowski at 358–363, by referencing three factors that establish the rationale for the doctrine of mootness: (

a) the presence of an ongoing adversarial context; (

b) the need for judicial economy; and (

c) the requirement that courts be sensitive to their role and their proper law-making function as an adjudicator of disputes. These are factors to be considered, but not in a mechanical way. Deciding to hear an appeal that is moot remains a discretionary decision, and no one single factor may dominate a court’s determination in that regard. [ 49 ] Mr.

Cimmer relies on three American cases for the proposition that courts are moving towards an increased willingness to hear moot cases, particularly when the public interest or judicial economy are key features in the analysis: Eye Dog Foundation v State Board of Guide Dogs for the Blind , (SC 1967) 67 Cal 2d 536; Californians for Alternatives to Toxics v California (Department of Pesticide Regulation) , 2006 Cal App LEXIS 206 (CA); and Lincoln Place Tenants Association v Los Angeles (City) , 155 Cal App 4th 425 (CA 2007) .

He submits that this same trend is gaining traction in Canada and points to Ditto v Canada (Public Safety and Emergency Preparedness) , 2013 SCC 47 , [2013] 3 SCR 157, as an example of this development. I note that, in Ditto , the Supreme Court continued to apply the framework from Borowski . In my view, the test in Saskatchewan remains the one set out in Borowski . This has been recently confirmed by this Court in Prince Albert and Dearborn v Saskatchewan (Financial and Consumer Affairs Authority) , 2017 SKCA 63 . [ 50 ] Here, there remains an adversarial context.

The underlying dispute is ongoing and the parties both presented their arguments on this appeal in a vigorous and comprehensive manner. That bodes in favour of hearing the appeal. [ 51 ] Skipping ahead to the third factor, I note that this aspect of the test relates to the need to be cognizant of the court’s role in relation to the legislative branch of government and not to improperly involve itself in the determination of important public issues in the absence of a live dispute.

That factor has little relevance to the circumstances of this matter. [ 52 ] With regard to the concern for judicial economy, I find the following excerpt from Borowski to be particularly relevant to the exercise of the Court’s discretion in the current circumstances (at 360–361): Similarly an expenditure of judicial resources is considered warranted in cases which although moot are of a recurring nature but brief duration.

In order to ensure that an important question which might independently evade review be heard by the court, the mootness doctrine is not applied strictly. … The mere fact, however, that a case raising the same point is likely to recur even frequently should not by itself be a reason for hearing an appeal which is moot. It is preferable to wait and determine the point in a genuine adversarial context unless the circumstances suggest that the dispute will have always disappeared before it is ultimately resolved.

There also exists a rather ill-defined basis for justifying the deployment of judicial resources in cases which raise an issue of public importance of which a resolution is in the public interest. The economics of judicial involvement are weighed against the social cost of continued uncertainty in the law. [ 53 ] In the matter at hand, there is no persuasive reason to hear this appeal. It does not involve a fleeting issue or one that is evasive of review. There is no uncertainty in the law regarding anti-suit injunctions. This appeal does not raise issues of general public interest.

Its result would have no tangential effect on the rights of the parties. The fact that Mr. Cimmer was content to let this appeal languish for close to five years without taking steps to move it forward speaks volumes in relation to the importance he attaches to having this issue determined. There is no reason why judicial resources should be further expended on this appeal. I find this to be a dominant factor that strongly militates against hearing the appeal. [ 54 ] In my view, the appeal should not be heard. The appeal in CACV3081 is dismissed. [ 55 ] I make two final observations on this appeal.

First, these reasons should not be taken as approval of the Chambers judge’s determination that Mr. Cimmer’s initial failure to participate in the New Jersey proceedings represented his acquiescence in the settlement purported to have been reached on July 29, 2016. Second, I offer no comment on the appropriateness of the Superior Court of New Jersey taking jurisdiction in relation to the shares. This judgment should not influence, one way or the other, any future proceedings to register a

New Jersey order in Saskatchewan. B. Injunction prohibiting the sale of shares – CACV3399 1. Absence of clean hands [56] Mr. Cimmer asserts that the Niessners have engaged in fraudulent activity that should deprive them of the ability to availthemselves of the assistance of the courts. He argues that they have admitted that the APS was a sham entered into in order to deceive theCanadian government and, through the Corporation’s filings, the Saskatchewan government as well. Mr.

Cimmer contends that the Courtof Queen’s Bench should not have heard the application because of this conduct and the consequent absence of clean hands on the part ofthe Niessners. [57] The clean hands – or unclean hands – doctrine is classically referred to as ex turpi causa non oritur actio. This means a partycannot base a claim or cause of action on their own illegal acts: Nagel’s Debt Review Inc. v Mosiuk, 2019 SKCA 16 at paras 68–69,[2019] 4 WWR 60.

The nature of this principle was discussed by Savage J.A. in Zhang v Cute-Go Novelty Inc., 2016 BCCA 451, [2017] 2WWR 39, in the following terms: [13] The doctrine of ex turpi causa was first set out by Lord Mansfield in Holman v. Johnson (1775), 1 Cowp 341–343, that “no court willlend its aid to a man who founds his cause of action upon an immoral or an illegal act”. [14] The seminal case in Canada on ex turpi causa is Hall v.

Hebert, (SCC), [1993] 2 S.C.R. 159, wherein McLachlin J.(as she then was) set out the essential rationale of the illegality doctrine as the maintenance of consistency in the law and the integrity ofthe legal system (at 169): My own view is that courts should be allowed to bar recovery in tort on the ground of the plaintiff’s immoral or illegal conduct only invery limited circumstances. The basis of this power, as I see it, lies in duty of the courts to preserve the integrity of the legal system, and isexercisable only where this concern is in issue.

This concern is in issue where a damage award in a civil suit would, in effect, allow aperson to profit from illegal or wrongful conduct, or would permit an evasion or rebate of a penalty prescribed by the criminal law.

Theidea common to these instances is that the law refuses to give by its right hand what it takes away by its left hand. [Emphasis added.] [15] The basis of ex turpi causa is public policy; a review of the policy interests at play and proportionality guide the inquiry (at 169): Whether we describe the principle under which judges are allowed to deny recovery to a plaintiff by an old-fashioned Latin name or bythe currently fashionable concept of “public policy”, the underlying problem remains the same: under what circumstances should theimmoral or criminal conduct of a plaintiff bar the plaintiff from recovering damages to which he or she would otherwise be entitled. [16] It is clear from the jurisprudence that an illegal act does not automatically bar recovery.

It is actually in narrow circumstanceswhere it does. The required exercise is to balance the policy interests and the need for proportionality in the circumstances of the case. (Emphasis added in Zhang) [58] This is an argument that Mr. Cimmer chose not to make in the Court of Queen’s Bench, but he now asks this Court to giveeffect to it. It cannot be applied in this Court in relation to the conduct of the appeal because the doctrine does not deprive a party of theability to defend against a claim or, by analogy, to provide a response to an appeal.

In the rare circumstances when it is applied, theprinciple blocks a party from appearing in court and wielding a sword forged from their own illegal actions, but does not prevent theopposing party from raising a shield that does not rely on illegal conduct. [59] Mr. Cimmer is asking this Court to now reach back into the proceedings in the Court of Queen’s Bench and determine that theapplication should never have been permitted to proceed when he, himself, failed to raise such a concern at the time.

In the circumstancesof this matter, relying on Meier v Saskatchewan Institute of Agrologists, 2016 SKCA 116 at paras 28–31, 405 DLR (4th) 506 [Meier], Ifind that it is not appropriate to allow Mr. Cimmer to make this argument for the first time in this Court. Had he raised this graveallegation in the Court of Queen’s Bench, the Niessners would have been able to present evidence and make submissions in an attempt tocounter the argument that sought such an extraordinary remedy. This Court would have then had the benefit of that evidence and theChambers judge’s ruling on the issue.

The determination as to what degree each party has engaged in illegal conduct, if any, along withthe effect of any such finding, is best left to be dealt with as the matter progresses through the Court of Queen’s Bench. 2. Taking account of the New Jersey proceedings [60] Mr. Cimmer argues that the Chambers judge erred by taking into account the proceedings in the Superior Court of New Jersey.His submissions follow two tracks. First, he asserts that there was no admissible evidence of those proceedings in front of the Chambersjudge.

Second, he submits that the Chambers judge adopted the findings of fact from the judge in New Jersey when he was required tomake his own finding of fact. I will address the first of these assertions in this section, leaving the second contention to be addressed in thecontext of a later issue. [61] The evidence filed in this matter included copies of four separate orders that purportedly came from the Superior Court of NewJersey. Ms. Niessner’s November 14, 2018, affidavit attached three orders from that court dated May 8, 2017, June 16, 2017, andNovember 2, 2018.

The November 27, 2018, affidavit of a legal assistant for the Niessners’ (then) lawyer, attached a further order datedNovember 16, 2018. Mr. Cimmer argues that these orders were not admissible because they were not certified by the Superior Court ofNew Jersey to be true copies of the originals. He asserts that s. 47(2) of The Evidence Act, SS 2006, c E-11.2, requires such certification;and, in the absence of such certification, they were inadmissible.

[ 62 ]

Section 47 of The Evidence Act is as follows: Court records 47

(1) In this section, “court” means: (

a) with respect to Canada or any province or territory of Canada: … (

b) with respect to any other jurisdiction: (

i) a court of record, if the judicial system of the jurisdiction is based on the common law; or …

(2) A copy of a court record or document is admissible in evidence to the same extent as the original if it is certified: (

a) by the official of that court who is the proper custodian of the court records … . [ 63 ] I cannot accede to Mr. Cimmer’s argument regarding the inadmissibility of the New Jersey court records. [ 64 ] Mr. Cimmer has never challenged the authenticity of the four New Jersey orders. He did not apply to adduce fresh evidence on appeal and did not, in his submissions, even hint that they might not be accurate copies of the New Jersey court records. Mr. Cimmer did not object to the admissibility of the purported copies of the records in the Court of Queen’s Bench nor raise an issue regarding The Evidence Act .

His argument is that, despite the absence of objection in the Court of Queen’s Bench, this Court should review the evidence that he chooses to now challenge and make evidentiary rulings in the first instance. [ 65 ] Mr. Cimmer’s position is somewhat ironic, given that he attached a copy of a document from the Superior Court of New Jersey to his own December 18, 2018, affidavit, appended as part of exhibit L. He asserts that these New Jersey court records were admissible because they were certified as true copies of the original.

However, an examination of the original affidavit filed in the Court of Queen’s Bench reveals that there is no such certification present. There is a photocopied form of certification from his own American counsel as part of that record, but it relates to service on the other parties, not the accuracy of the copy filed with the Court of Queen’s Bench. In any event, that certification was not done “by the official of that court who is the proper custodian of the court records” (s. 47(2)(a)). [ 66 ] Similarly, in CACV3081, Mr.

Cimmer appended copies of New Jersey court records to his own affidavit, averred that they were true copies and relied upon them in his arguments: see exhibits C, G, J, M, N and O to his November 23, 2016, affidavit. None of those documents were certified as original either.

As in the matter at hand, there was no objection to their admissibility, their authenticity was not challenged, and they were accepted as accurate copies upon which the Chambers judge could rely. [ 67 ] The notice of appeal filed in this matter does not mention The Evidence Act and does not allege that the Chambers judge erred by admitting the New Jersey court records. The closest it comes to this assertion is in paragraph 4(g), where the following error is alleged: (

g) Regarding the first step of the test for injunctive relief, being whether there is a serious issue to be tried, the chambers judge erred in law because he did not accurately identify and consider the relevant question before him at this stage of the test. In doing so, the chambers judge misapprehended the relevance, meaning, scope, and effect of a foreign court’s order. [ 68 ] This ground of appeal does not challenge the admissibility of the New Jersey records. It alleges error in how the Chambers judge interpreted and used them.

The objection to admissibility is a new issue found for the first time in submissions on appeal. Had it been raised in the Court of Queen’s Bench, additional evidence may have been called and we would have had the benefit of the Chambers judge’s ruling as a basis for review. For this reason, based on Meier , I would not give effect to this line of argument. [ 69 ] As a final point, while this remains to be determined another day, I do not see s. 47 of The Evidence Act as setting out an outright prohibition on the admission of uncertified court records.

In my view, s. 47 provides a streamlined method by which copies of records from courts outside of Saskatchewan can be filed in proceedings within the province without the need for further attestation as to their authenticity. It does not create a complete barrier to admission on any other basis; but, rather, it facilitates the smooth admission of such records by allowing copies of them to be tendered on the strength of the certification. 3. Standing under s. 63 of the PPSA [ 70 ] Mr. Cimmer argues that the Niessners had no standing to bring the application under s. 63 of the PPSA . The relevant portions of that

section are as follows: Applications to court 63

(2) On application by a debtor, a creditor of a debtor, a secured party, a sheriff or a person with an interest in the collateral , the court may make one or more of the following orders: … (

e) any order that is necessary to ensure protection of the interest of any person in the collateral. [ 71 ] Mr. Cimmer submits that neither of the Niessners are “a debtor, a creditor of a debtor, a secured party, a sheriff or a person with an interest in the collateral”. As such, he asserts, the Chambers judge had no jurisdiction to grant the order. The Niessners contend that they are persons with an interest in the collateral and were entitled to apply for, and be granted, the order.

[72] The Chambers judge did not conduct a lengthy analysis of this issue or specify whether he found both Niessners to have aninterest in the collateral or just Mr. Niessner. I will focus my analysis on Mr. Niessner because, if he had an interest in the 60 shares –leaving aside the merits of the application for the time being – the Chambers judge had the authority to make the order that he did. Thereis no evidence that Ms. Niessner has any such interest. [73] The question of whether a person in Mr. Niessner’s position can be a person with an interest in the collateral under s. 63 of thePPSA raises an issue of statutory

interpretation. It is, therefore, reviewed on a standard of correctness: Housen v Nikolaisen, 2002 SCC 33at paras 8–9, [2002] 2 SCR 235; Arslan v Şekerbank T.A.Ş, 2018 SKCA 77 at para 43, 38 CPC (8th) 311; and Charles v SGI, 2021 SKCA11 at para 14, 456 DLR (4th) 132. [74] While s. 63 of the PPSA is referred to frequently in Saskatchewan jurisprudence, neither party identified any case thatinterpreted the phrase in question.

The general purpose of s. 63 has been the subject of commentary by this Court in Andrews, whichreferred to the wide authority granted by the section: [17] It will be noted that the court is given broad powers under s. 63, including the right to make declarations of rights, grant injunctiverelief, or make any order required to ensure compliance with

Part V and s. 17 of the Act. Professor Ronald C.C. Cuming, commenting ons. 63 in an

article entitled Second Generation Personal Property Security Legislation in Canada (1981–82), 46 Sask. Law Rev. 5, stated atp. 41: “A feature peculiar to the Saskatchewan Act is wide judicial control over the exercise of default rights and remedies. Under the Ontarioand Manitoba Acts, deviation from the prescribed structure is not permitted. This is not the case in Saskatchewan. The Saskatchewan Actgives to the courts a wide range of powers including the power to make binding declarations of rights, to issue injunctions, to givedirections to parties regarding the exercise of rights or discharge of obligations, to relieve from compliance with

Part V of the Act, to stayenforcement of default rights and remedies, and to make orders for the protection of any person’s interest in collateral. The decision togive such broad discretionary jurisdiction to courts entails some risk. If this power is exercised without care, it may result in a great deal ofdisruption in business financing transactions.

If, however, it is exercised within the spirit of the legislation, it can be a very constructivemethod of avoiding the difficulties which are endemic to the detailed and inflexible system prescribed by personal property securitylegislation”. (emphasis added [in Andrews]) (Italic emphasis in original) [75] Although it is not clear in the material, it appears that the remedy Mr. Cimmer sought to avail himself of arose out of

Part V ofthe PPSA, specifically s. 59. This is the only

section that matches the form and substance of the Notice. The broad powers in s. 63, asreferred to in Andrews, are available to be exercised in relation to a notice provided under s. 59. While I harbour some doubts aboutwhether the Notice could be used in the circumstances at hand, and in the manner purported to have been done by Mr. Cimmer, its validitywas not challenged in the Court of Queen’s Bench nor in this Court. As such, for the purposes of this appeal, I will assume that the Noticewas valid, without making that determination. As a result, provided that Mr.

Niessner could establish that he was a person with an interestin the 60 shares, he could bring himself within the ambit of s. 63. [76]

Section 63 of the PPSA has been addressed in a manner closer to the current circumstances than was the situation in Andrews,but not in a way that informs the determination of the issue at hand to any significant extent. For example, in Pro-Fresh MarketingInternational Ltd. v Royal Bank of Canada (1991), 92 Sask R 143 (QB), the applicant sought a

summary order under s. 63 determiningthat it had a beneficial interest in money that was seized from the bank account of another company. Justice Wimmer addressed the issueof the applicant’s standing under s. 63 on two bases. First, he noted that the facts were in dispute so the

summary method sought to beutilized by the applicant was not appropriate. Second, relying on Andrews, Wimmer J. noted that the application did not involve

Part V ors. 17 of the PPSA, so s. 63 was not available. Clarkson Company Ltd. v Chrysler Credit Canada Ltd. (1984), 3 PPSAC 275 (Sask QB),and Holnam West Materials Ltd. v Canadian Concrete Products Ltd., (AB KB), [1995] 1 WWR 155 (Alta QB), arefurther examples of cases that tangentially address the issue, but do not provide any particular guidance on the

interpretation of the phrasein question. Despite there being similar legislation in other provinces, it does not appear that this particular issue has been the subject ofmuch controversy. [77] Given the dearth of case law interpreting the portion of the PPSA in question, I will turn to the principles of statutoryinterpretation in order to determine whether a person in the position of Mr. Niessner can bring himself within the ambit of s. 63. [78]

Section 2-10(1) of The Legislation Act, SS 2019, c L-10.2, requires that the words of

an Act are to be “read in their entirecontext, and in their grammatical and ordinary sense, harmoniously with the scheme of the Act, the object of the Act and the intention ofthe Legislature”. In s. 2-10(2), the courts are directed to construe every enactment as being remedial and to give it “the fair, large andliberal

interpretation that best ensures the attainment of its objects”. [79] The modern approach to statutory

interpretation, which is codified in The Legislation Act, was summarized in part by themajority in Regina Bypass Design Builders v Supreme Steel LP, 2021 SKCA 82, as follows: [25] The language of the statutory provision in question is always the starting point, but not the end point, of an exercise in

interpretation.As noted in Hess v Thomas Estate, 2019 SKCA 26, 433 DLR (4th) 60 [Hess]: [50] The modern principle and s. 10 [now s. 2 of The Legislation Act] demand a contextual and purposive approach. However, that doesnot mean the court can ignore the ordinary meaning of the words chosen by the legislature. As noted in Ruth Sullivan, Sullivan on theConstruction of Statutes, 6th ed, (Markham, Ont: LexisNexis, 2014) at 29 [Sullivan]: …

interpretation properly begins with the ordinary meaning — with reading words in their grammatical and ordinary sense — but does notstop there. Interpreters are obliged to consider the total context of the words to be interpreted in every case, no matter how plain thosewords may seem upon initial reading. [51] The ordinary meaning prevails unless there is a reason to reject it based on contextual considerations. …

[26] In Ballantyne [2015 SKCA 38], Ryan-Froslie J.A., also citing Ruth Sullivan in Sullivan on the Construction of Statutes, 6th ed,(Markham, Ont: LexisNexis, 2014) [Sullivan], wrote: [20] … 2. Even if the ordinary meaning is plain, courts must take into account the full range of relevant contextual considerations includingpurpose, related provisions in the same and other Acts, legislative drafting conventions, presumptions of legislative intent, absurdities tobe avoided and the like. 3. … the court may adopt an

interpretation that modifies or departs from the ordinary meaning, provided the

interpretation adopted isplausible and the reasons for adopting it are sufficient to justify the departure from ordinary meaning. [27] The modern principle emphasizes the importance of purposive analysis in statutory

interpretation. All legislation is presumed to havea purpose which courts should strive to discover and give effect to through the interpretive process. Legislative purpose must be taken intoaccount at every stage of the

interpretation exercise and, so far as the language of the text permits,

interpretations that are consistent withor promote legislative purpose should be adopted, while those that defeat or undermine legislative purpose should be avoided (Sullivan at§9.3; Farm Credit Canada v Gustafson, 2021 SKCA 38 at para 58). [28] Context must also be taken into account. As Sullivan observes, at §2.19, “in hard cases the contextual factors point in differentdirections” and “[i]n such cases, reading the text harmoniously with the scheme and object of the Act and the intention of the legislaturerequires a balancing act”.

All of this means that in some instances, the plain meaning of the words used will receive greater weight in theanalysis and, in other cases, less. As Sullivan describes, at §2.37: The factors that justify outcomes in statutory

interpretation are multiple, involving inferences about meaning and intention derived fromthe text, non-textual evidence of legislative intent, specialized knowledge, “common sense” and legal norms. These factors interact incomplex ways.

It is never enough to say the words made me do it. [80] The overall purpose of the PPSA is “to simplify commercial transactions and to make the law governing them accord withpractical commercial realities” (Agricultural Credit Corporation of Saskatchewan v Pettyjohn (1991), (SK CA), 90Sask R 206 (CA) at para 47: see also Canadian Imperial Bank of Commerce v Marathon Realty Co. (1987), (SK CA),40 DLR (4th) 326 (CA) at para 17, leave to appeal to SCC refused, [1988] 2 WWR lxvi.

The PPSA provides a process that facilitatescommercial transactions, and their financing, while ensuring that all involved parties benefit from reasonably predictable outcomes.Section 63(2) provides a method whereby “a person with an interest in the collateral” may apply to the Court of Queen’s Bench for,among other things, an “order that is necessary to ensure protection of the interest of any person in the collateral”.

The purpose of thissection is to permit applications to the court for direction, in the form of orders, when issues arise in the extrajudicial functioning of thesecured transaction system. [81] On the face of s. 63(2), the scope of persons who may apply for such an order and whose interests can be protected by such anorder seems wide. The only constraining language is the phrase “with an interest in the collateral”. The term collateral means personalproperty that is subject to a security interest, which serves to narrow the uses of

Part V and s. 63, to some extent. Neither interest nor thephrase a person with an interest in the collateral is defined or further elaborated upon in the PPSA; however, it is a phrase that is usedfrequently in the PPSA. For example, in s. 64(5), “a person with an interest in the collateral in the custody or control of the receiver …may … require the receiver to provide copies of the financial statements or … the final accounts … or to make them available forinspection …”. The term security interest is defined in s. 2(qq), but it provides no assistance because s. 63(2) does not require an applicantto hold a security interest. [82] Dictionary

definitions of interest include the following: (a) “A legal share in something; all or part of a legal or equitable claim to or right in property …” (Black’s Law Dictionary, 11thed, sub verbo “interest”). (b) “The fact or relation of being legally concerned; legal concern in a thing; esp. right or title to property, or to some of the usesor benefits pertaining to property …” (Oxford English Dictionary Online (Oxford University Press, March 2022) sub verbo “interest”). [83] The enumerated list of persons in s. 63 also informs the

interpretation of the qualification found in the phrase in question. Thesection lists “a debtor, a creditor of a debtor, a secured party, a sheriff or a person with an interest in the collateral”, so the last portionmust capture persons that are not the usual parties to a secured transaction or enforcement in relation to collateral but fall into the samecategory as the enumerated persons. Notably, absent from this list is an owner.

While the owner will usually be the same person as adebtor, the PPSA permits owners of personal property who are not debtors to pledge their property as security for someone else’s debt. Ihave no doubt that the undisputed owner of such property would have the right to apply under s. 63, if a problem were to arise between asecured party and the debtor where the secured party was taking enforcement action. However, I find that a claim or assertion that aperson might establish a right to ownership of the collateral at some point in the future is not sufficient. The interest must be one that isrecognized at law.

A claim is not such an interest. [84] Mr. Niessner claims to be the beneficial owner of the 60 shares and provided significant evidence supporting that assertion.There is a genuine controversy as to the ownership of the shares; however, none of the material establishes that Mr. Niessner has a currentinterest in the shares that is recognized at law. Under the APS, he purported to sell the shares to Mr. Lunemann. While the Niessners andMr. Lunemann occupy common ground as to the sham nature of the APS, I note that the July 29, 2016, MOS did not return ownership ofthe shares to Mr. Niessner.

Under that agreement, half of the 60 shares were to be redeemed and retired while the other half were to havebeen retained by Mr. Lunemann. Additionally, the latest corporate profile report shows the 60 shares are held by the lawyer appointed asthe custodial receiver by the Superior Court of New Jersey. There is no evidence of a subsequent judgment that returns ownership of anyof the shares to Mr. Niessner. The best that can be said is that Mr. Niessner has a claim that involves the collateral.

In my view, that is notsufficient to bring him within the scope of s. 63 of the PPSA. [85] The Court of Queen’s Bench must exercise caution so as not to permit parties external to the issues, or with mere claims, to

make applications under s. 63 of the PPSA and thereby obtain injunctions . Absent such standing, a person seeking an injunction may do so by commencing an action in which the necessary injunctive relief is claimed. [ 86 ] The Niessners were not entitled to seek the injunction under s. 63 of the PPSA . Additionally, they did not ask for such an injunction in their statement of claim filed in QBG 859 of 2016. As such, the Chambers judge had no jurisdiction to grant the injunction. The appeal in CACV3399 must be allowed and the injunction set aside.

Given that an application for an injunction preventing a future sale of the shares might be renewed in the Court of Queen’s Bench, I do not find it appropriate to further review the granting of the injunction. The Court’s decision in this appeal does not address whether Mr. Cimmer had or has the authority or the right to take steps to dispose of the shares of the Corporation. That issue is beyond the scope of this appeal. VI. CONCLUSION [ 87 ] The appeal in relation to the anti-suit injunction is dismissed. The appeal with regard to the order prohibiting the sale of the shares is allowed.

Considering the degree of success by each party, I find it appropriate not to award costs to either party. “Tholl J.A.” Tholl J.A. I concur. “Jackson J.A.” Jackson J.A. I concur. “Ryan-Froslie J.A.” Ryan-Froslie J.A.