In Campbell v Brar, 2024 MBCA 72, the Manitoba Court of Appeal upheld the trial judge’s decision in a high-stakes shareholder dispute involving a successful towing business in Winnipeg. The Supreme Court of Canada subsequently dismissed the application for leave to appeal, cementing the appellate court’s endorsement of the trial court’s broad discretion in fact-finding and granting relief under the oppression remedy.
In the trial level decision, Campbell et al. v. Brar et al., 2022 MBKB 225, the trial judge was asked to determine each party’s respective shareholding interest in the company and remedy the alleged oppressive conduct of the defendant shareholder and directing mind..
The parties were a small-knit group of close-knit shareholders, many of whom were also family members who had been operating the company business together since 2006. The case was factually complex, involving disputes over the amalgamation of shares, a trust declaration that the defendants did not recall had been signed, and additional contested issues such as the source and attribution of investment funds and claims of undue influence and duress.
Applying the ‘Objective Reasonable Bystander’ Test
One of the most interesting aspects of the ruling was the judicial allocation of shares in the business. The trial judge allocated half of the shares owned by one of the shareholders to the other two shareholders, despite the fact that those shares were supposedly held in trust for another third party. The third party denied beneficial ownership of those shares but nevertheless wanted the shares to go to the original shareholder (“Rickvinder Brar”, the Defendant/Appellant), which the trial judge declined.
The trial judge appointed the “objective reasonable bystander” test to determine the parties’ true intentions and arrangements. This approach led to a reallocation of shares among the parties in a manner the court deemed fair and consistent with their historical conduct and expectations.
Appellate Endorsement of Trial Court’s Fairness Analysis
The Manitoba Court of Appeal upheld the trial judge’s findings in full, emphasizing that trial courts have broad discretion as initial triers of fact to determine what is “fair” in the context of oppression claims. The Court of appeal deferred to and upheld the trial judge’s reasoning as grounded in a thorough assessment of the parties’ history and expectations. in the result, the Court ratified the trial ruling as neither arbitrary nor manifestly unjust.