CIVIL PROCEDURE - Actions - Pleadings - False, frivolous, vexatious or abuse of process - Res judicata

Law360 Canada ( February 3, 2026, 9:37 AM EST) -- Appeals by appellants from two orders refusing to stay proceedings for costs and another striking out a new action. In 2017 (2017 Action), the appellants sued RBC Dominion Securities (RBC) and its employee, Crowle, alleging negligence and breach of contract for unsuitable investment advice, unauthorized trading, and failure to follow instructions. The trial judge dismissed the claims after finding no damages resulted from a breach of duty of care. The Court of Appeal dismissed the appeal. In December 2023 (2023 Action), the appellants commenced a new action seeking to set aside the 2017 judgment on grounds of fraud and claiming damages against RBC and related parties. They alleged that Crowle was improperly registered as a dealing representative rather than an advising representative under securities regulations and had misrepresented his qualifications. The 2023 Action repeated allegations from the 2017 Action and added claims regarding registration status. The respondents applied to strike the 2023 Action as an abuse of process and res judicata, and the appellants sought a stay of costs proceedings in the 2017 Action, arguing the judgment was vitiated by fraud. The chambers judge struck the 2023 Action and refused the stay, finding no basis for fraud and that the 2023 Action was an attempt to relitigate issues already determined. The appellants appealed, contending the fraud allegations justified setting aside the prior judgment and that the 2023 Action was distinct from the earlier one. The appellants contended that by recharacterizing their claim as one based in fraud with respect to registration status, they were able to avoid the doctrine of res judicata....
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