Law360 Canada ( April 20, 2021, 6:23 AM EDT) -- Appeal by the defendants, Quershi and Wong, from an order refusing an interim advance of legal costs from the plaintiffs, the Enliven companies. The defendants were former officers of Enliven who started and operated the business. They remained directors and shareholders. The Enliven companies alleged that the defendants committed a wide range of torts, including breach of fiduciary duty, fraud, deceit, unjust enrichment and negligence. In a separate, parallel action, Enliven’s other shareholders sued the defendants alleging a deceptive pump and dump scheme to obtain investment funds. The defendants applied for an interim advance of $200,000 to pay for their legal costs of defending the actions. They relied upon the companies’ bylaws and s. 124 of the Canada Business Corporations Act (CBCA). The chambers judge found no entitlement to the advance sought. No such advance was mandatory under s. 124. To the extent that the bylaws entitled the defendants to an advance, they were displaced by the indemnity provisions in the Unanimous Shareholder Agreement (USA). In addition, the strong prima facie case of fraud rebutted any presumption of good faith and disentitled the defendants to an advance of costs. The defendants appealed....