Jellett v. Morgan

Jellett v. Morgan Court Court of Appeal Date 2008-04-24 Citation 2008 NSCA 37 Docket CA 290010 Judge/Registrar/Adjudicator Cromwell, Thomas A. (Honourable Justice); Oland, Linda L. (Honourable Justice); Roscoe, Elizabeth A. (Honourable Justice) (CA) Document Type Decision Relations Library Sheet - Jellett v. Morgan - 2008 NSCA 37 - 2008-04-24 - Library Sheet Decision Content NOVA SCOTIA COURT OF APPEAL Citation: Jellett v. Morgan, 2008 NSCA 37 Date: 20080424 Docket: C.A. No. 290010 Registry: Halifax Between: Joanne Fraser Jellett Appellant v. William Hywel Morgan and Jellett Rapid Testing Limited Respondents Judges: Roscoe, Cromwell and Oland, JJ.A. Appeal Heard: April 17, 2008, in Halifax, Nova Scotia Held: Leave to appeal granted but appeal dismissed per reasons for judgment by the Court. Counsel: Michael J. O’Hara, for the appellant Angus Gibbon, for the respondents Reasons for judgment: [1] The appellant seeks leave to appeal an interlocutory order of MacLellan, J. The order under appeal directed the amendment of an earlier order the judge had made by adding to it a recital reflecting the fact that he had made an interim finding of oppression under the Companies Act, R.S.N.S. 1989, c. 81 at the time of making the earlier order. At the conclusion of the appellant’s submissions we granted leave to appeal but dismissed the appeal. Our reasons follow. [2] Mr. Morgan and Dr. Joanne Fraser Jellett have been engaged in a dispute over the management of Jellett Rapid Testing Limited (JRTL) since 2005. On June 6, 2006, Mr. Morgan filed an originating application for an oppression remedy pursuant to s. 5 of the Third Schedule to the Nova Scotia Companies Act. To support the application, a 42 page affidavit of Mr. Morgan with 33 exhibits was filed. Mr. Morgan’s application requested nine specific remedies. The application was scheduled to be heard on June 16, 2006. Counsel for Dr. Jellett objected to having to respond on such short notice and requested an adjournment. Counsel for Mr. Morgan indicated by letter that he was prepared to adjourn all but three items, those set out in points 1, 2 and 7 in his requested list of remedies. [3] During a telephone conference with counsel and Justice MacLellan on June 14, 2006, it was agreed that the judge would conduct a settlement conference on Wednesday, June 21, 2006. This was to be done on the understanding that if no settlement was reached “... the Court could impose an order dealing with these matters [that is, the three issues identified in paragraphs 1, 2 and 7 in Mr. Morgan’s application] based on the materials reviewed at the settlement conference.” [4] The settlement conference proceeded as planned but was unsuccessful. Thereafter the judge received written submissions from counsel for both parties and a lengthy affidavit of Dr. Jellett addressing some of the factual allegations made against her. [5] On July 26, 2006 Justice MacLellan issued an interim order which recited: UPON reading the Affidavits of the Plaintiff, WILLIAM HYWEL MORGAN, and the Affidavit and other materials provided by the Defendant, JOANNE FRASER JELLETT; AND UPON a settlement conference having been conducted on June 21, 2006; AND UPON hearing ANGUS GIBBON and BRUCE T. MACINTOSH, Q.C., for the Plaintiff, and MICHAEL J. O'HARA for the Defendant Joanne Fraser Jellett; [6] The order addressed the three matters referred to earlier. It prescribed that Mr. Morgan be appointed sole director and president of JRTL, that he be restrained from a specified list of activities without the consent of Dr. Jellett, and that he be authorized to cancel a share certificate representing 100 common shares in Dr. Jellett’s name and to issue 50 common shares to her and 50 to himself. Both parties were enjoined from communicating any derogatory or harmful opinion regarding the company or its shareholders. Lastly the order provided: “ The relief requested by the Plaintiff pursuant to the Originating Notice in this Application shall be heard at a date and time to be fixed by the Court, and the provisions of this Order shall be returnable to this Court upon Application by any of the parties, with notice to the other parties.” [7] No appeal was taken following the July 26, 2006 order. In April 2007 further unsuccessful settlement conferences were held by Justice MacLellan. [8] In November 2007, Mr. Morgan brought an interlocutory application to vary the July 2006 order and Dr. Jellett brought a cross application for the removal of her name from the company’s name. The matters were scheduled to be heard by Justice Arthur Pickup who received submissions from counsel on the issue of whether Justice MacLellan had made a finding of oppression at the time of making his July order. Dr. Jellett took the position there had not been a prior finding of oppression and, therefore, the order could not be varied. Justice Pickup remitted that issue to Justice MacLellan by order dated December 11, 2007, which stated: This matter is remitted back to the Honourable Justice Douglas L. MacLellan for a direction as to whether the Interim Order of July 26, 2006 was issued on the basis of a determination that there had been oppression, unfair prejudice, or unfair disregard for the Plaintiff’s interests, pursuant to Section 5 of the Third Schedule to the Companies Act. [9] On December 20, 2007, Justice MacLellan heard counsel for the parties and confirmed that he had in fact made a finding of oppression in determining Mr. Morgan’s entitlement to the interim relief claimed, and determined that it was appropriate to amend the July 26, 2006 order to reflect that finding. [10] The correction to the earlier order was made pursuant to Civil Procedure Rule 15.07: 15.07 Clerical mistakes in judgments or orders, or errors arising therein from any accidental mistake or omission, or an amendment to provide for any matter which should have but was not adjudicated upon, may at any time be corrected or granted by the court without appeal. [11] The December 20, 2007 order reads as follows: 1. The Order of this Honourable Court on file herein dated July 26, 2006 be amended for purposes of further clarity with the insertion of the following third recital: AND UPON this Honourable Court being satisfied that the grounds exist for granting of interim oppression relief as sought by the Applicant pursuant to Section 5 of Schedule Three of the Nova Scotia Companies Act, as amended. [12] The appellant appeals only the judge’s decision to clarify his earlier order by amending it to add this recital. It is clear from the judge’s oral reasons that he acted under the power to correct an accidental omission from the earlier order, not to adjudicate some matter that should have been, but was not adjudicated upon at that time. The appeal, therefore, relates only to whether the judge erred by agreeing to amend his earlier order so that it would reflect more clearly what he had, in fact, done in July. [13] However, the appellant’s submissions are directed not at the decision to clarify the text of the earlier order, but at the propriety of the judge having made a finding of oppression at all. The appellant submits that the judge misunderstood what had been agreed to between counsel in the telephone conference call of June 14, 2006 and he was wrong to think that he had made a finding of oppression at the time of making his July 26, 2006 order. In short, the appellant’s arguments go to whether the judge could or should have made a finding of oppression at the conclusion of the July hearing. [14] With great respect to the appellant, these are not arguments which may be properly advanced or considered in the context of this appeal. We agree with the respondents when they write in their factum that “... whether Mr. Justice MacLellan was entitled or required to make [a finding of oppression] in July of 2006 go to the validity of the July 26, 2006 Order. That Order has not been appealed and its validity is not in issue in this proceeding.” In other words, this appeal is about whether MacLellan, J. erred by amending his order to reflect what he had done in making his July order; it is not about, as the appellant would have it, whether what the judge had done in July was wrong. [15] We see no basis on which we could interfere with the judge’s exercise of his discretion to amend his earlier order to reflect what he had, in fact, done at that time. Whether what he had done at that time was in error is not before us on this appeal. [16] While we grant leave to appeal, we dismiss the appeal with costs fixed at $1500 plus disbursements payable forthwith. We add that this case appears to be one that could benefit from judicial case management. Roscoe, J.A. Cromwell, J.A. Oland, J.A.