When Anton Piller Orders Go Wrong!

When Anton Piller Orders Go Wrong!

W. Xavier Navarrete

An Ontario court has ordered an applicant to pay damages for trespass and full indemnity costs for executing Anton Piller Order on the wrong party and at the wrong address.

In October 2008, Justice Hoy of the Ontario Superior Court of Justice in Multimedia Global Management v. Soroudi, [2008] O.J. No. 4383, ordered an applicant to pay damages for trespass and to pay full indemnity costs to an innocent third party. After obtaining an Anton Piller Order (APO), the applicant executed the APO on a gentleman who happened to have the same name as the target respondent (the innocent man was 65 years old, while the target respondent was 35 years old). The APO was also executed at the wrong address and the applicant seized documents outside the scope of the APO

On a motion for Judgment, Justice Hoy refused the applicant’s request that the matter proceed to trial. Instead Justice Hoy stated:

… I am satisfied that the information that I require to assess damages for trespass, in a situation where the Anton Piller Order was obtained, based on incorrect information put before the court as a result of inadequate investigation, and executed against a non-party — and the wrong party — at a residence and documents outside of the scope of the Order were seized is before me.

Damages in trespass were assessed at $15,000.00 and the applicant was ordered to pay $22,000.00 in legal costs, on a full indemnity basis. On the cost issue, Justice Hoy concluded:

In fixing this amount, I have considered that, as I advised the Appellants at the hearing, JZ shall be entitled to costs on a substantial indemnity scale — indeed a full indemnity scale. An innocent third party mistakenly subjected to a wrongful search of his residence under an Anton Piller Order — a civil search warrant should, in my view, except in the rarest of circumstances, be entitled to full indemnity costs.

Finally, in order to ensure that the respondent received his costs and damages, Justice Hoy ordered that the funds be withdrawn from the $100,000.00 security posted by the applicant when they obtained the APO.

More recently, Justice Morawetz of the Ontario Superior Court of Justice, in the very same case, had occasion to deal with the quantum of legal costs that should be awarded against an applicant who has had an APO dismissed. In his reasons, released on February 3, 2009, Justice Morawetz ordered the applicant to pay $175,000.00 to one respondent and $20,000.00 to another respondent.

In total, the error in the execution of the APO will has cost the applicant $232,000.00.

Both cases provide significant lessons for counsel who deal with APO’s. For lawyers seeking an APO, the decision reinforces that counsel must conduct a proper and comprehensive investigation before seeking such an extraordinary remedy. For lawyers defending APO’s, the decision stresses the importance of ensuring that the Court orders the applicant to post security prior to issuing the Order and the importance of going through the Order to ensure that the applicant has strictly complied with the Order.

For copies of the Justice Morawetz decision go to:

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