‘Overbroad and Overreaching’, Court of Appeal Overturns Anton Piller and Mareva Orders, Sends Warning to Overzealous Plaintiffs
- On June 4, 2018
By: David Cassin
The Alberta Court of Appeal recently set aside a number of Anton Piller and Mareva orders against certain defendants in Secure 2013 Group Inc. v Tiger Calcium Services Inc., 2017 ABCA 316.
While the case originates in Alberta, the Court of Appeal’s commentary on broad and overreaching Anton Piller and Mareva orders serves as a warning for plaintiffs (and their lawyers) in Ontario who seek to rely on these exceptional pre-trial remedies to obtain disclosure they would otherwise not be entitled to.
The plaintiffs commenced an action against six individuals and seven corporations arising from the acquisition of an interest in Tiger Calcium Services Inc. – a family-owned business operating throughout Alberta since 1964.
The plaintiffs’ claim advanced multiple causes of action including broad allegations of conspiracy, misrepresentation, and inducement, all allegedly resulting in the plaintiffs’ overpayment of approximately $44 million for shares in Tiger, and damages of at least $87 million for misrepresentations.
Procedural History – Ex Parte Orders
The plaintiffs sought an urgent ex parte motion on or about October 6, 2016, seeking various Anton Piller and Mareva orders against certain defendants. Five affidavits, sworn in September 2016, were relied on in support of the urgent motion.
Prior to October 6, the plaintiffs adjourned their motion date to November 30, 2016, and added parties against whom the various Anton Piller and Mareva orders were sought.
At the November 30 motion, the motions judge reviewed the September affidavits, heard submissions by the plaintiffs, and granted the requested orders largely in the form as set out. The motions judge was satisfied that the plaintiffs had met the stringent requirements for Anton Piller and Mareva orders.
On appeal, the defendants challenged whether the plaintiffs met the duty of candour and full disclosure required when seeking ex parte orders, arguing the Anton Piller and Mareva orders were overbroad and overreaching and did not fairly balance the competing interests at stake.
In setting aside the Anton Piller and Mareva orders, the Alberta Court of Appeal reviewed the law relating to ex parte orders generally, and reiterated the tests for Anton Piller and Mareva orders specifically.
The court took exception with the Anton Piller orders sought against certain third parties – in particular, certain law and accounting firms. The court confirmed, as set out by the Ontario Superior Court, that “searching the registered office of a defendant (often a law firm) or its accountant is generally ‘unwarranted’”.
The court also found that the affidavits filed in support of the applications included numerous unsubstantiated speculations and significant overstatements.
In addition, the court held that the requirement showing ‘that there is a real possibility that the defendant may destroy such material before the discovery process can do its work’, is particularly difficult to demonstrate when seeking such an order against a third party accountant or lawyer. This is so because it is not immediately apparent that a law or accounting firm would destroy material in their possession merely at the request of their clients.
Ultimately, the court set aside the orders against the third-party firms for being overly broad, and containing material overstatement of the evidence.
In setting aside the various Anton Piller and Mareva orders, the Court of Appeal noted the following highlights, which counsel should keep in mind:
- the exceptional nature of obtaining an Anton Piller order against a third party, particularly a law firm or an accounting firm, should be expressly drawn to the motions judge’s attention;
- counsel should be cautious not to make material misstatements in oral submissions and instead focus on what is contained in the affidavit evidence; and
- ensure there is sufficient evidence addressing each of the requirements for an order.
Tiger Calcium serves as a reminder to plaintiffs and their counsel in Ontario and elsewhere that Anton Piller and Mareva orders remain exceptional remedies and should be treated as such. The “tendency on the part of some counsel to take too lightly the very serious responsibilities imposed by such order[s]” should be guarded against.
Failure to navigate the availability of such extraordinary pre-trial discovery orders can result in significant costs and wasted time for parties seeking such orders.
Despite the Court of Appeal’s cautions, there remains a need for parties to obtain Anton Piller and Mareva orders, amongst other such orders, to ensure their rights are adequately protected. In such cases, it is integral to retain experienced counsel to advise and pursue all available remedies.
 Tiger Calcium at para 10.
 Ibid at para 36.
 Ibid at para 70.
 Ibid at paras 87-89.
 Ibid at para 71.
 Ibid at para 73.
 Ibid at para 80.
 Ibid at para 59.