Executive Summary: Key Legal and Evidentiary Issues

• A motion judge assessed whether the defendants' motion to strike a pleading was brought within the promptness requirement under Rule 21.01(2) of the Rules of Civil Procedure.
   
• Personal liability of a corporate officer turned on whether his conduct was tortious in itself or displayed a separate identity from the corporation he served.
   
• Sufficiency of a conspiracy pleading required particularized overt acts tied to each alleged co-conspirator rather than generalized allegations against the group.
   
• Intentional interference with economic relations demanded proof that an unlawful act was directed at an identified third party, not solely at the plaintiff.
   
• Unjust enrichment allegations were evaluated for whether they disclosed enrichment, corresponding deprivation, and the absence of a juristic reason.
   
• Leave to amend a struck pleading was considered against the standard that such leave should be denied only where no tenable claim could possibly be pleaded.
   

Facts of the case

Huron University College, a degree-granting college affiliated with Western University in London, Ontario, contracted with Higher-Edge FZ-LLC, a UAE-based student recruitment firm operating as the Canadian University Application Centre, on October 1, 2016. The two-year agreement gave Higher-Edge exclusive rights to recruit students from India and Bangladesh on Huron's behalf, while allowing non-exclusive recruitment elsewhere. When the contract came up for renewal in 2018, Huron initially indicated it would renew but ultimately declined, instead hiring Anjali Seth—then a Higher-Edge employee—as its own internal recruitment specialist for India. Higher-Edge claimed Seth misappropriated its confidential information and that Huron had acted in bad faith and breached its contractual obligations. Higher-Edge commenced an action in April 2021 against Huron, Seth, Huron's then-Chancellor Prem Watsa, and unnamed John and Jane Doe defendants, seeking $1 million in damages for breach of contract, breach of confidence, intentional interference with contractual relations, conspiracy, and unjust enrichment, along with related declaratory relief. The claim was served in September 2021. Rather than filing a defence, the defendants signalled an intent to move to strike the pleading for insufficiency. That motion was not formally served until August 2024, with the full motion record following in January 2025, and it was ultimately heard on July 13, 2026.

Policy and legislative provisions at issue

The motion engaged several provisions of Ontario's Rules of Civil Procedure. Rule 21.01(1)(b) permits a claim to be struck where it discloses no reasonable cause of action, while Rule 21.01(2) requires that such motions be brought promptly, with delay potentially affecting costs. Rule 25.11 allows a pleading to be struck, with or without leave to amend, where it may prejudice a fair trial, is scandalous, frivolous, or vexatious, or amounts to an abuse of process. Rule 25.06(1) requires every pleading to set out a concise statement of material facts, and a failure to meet that threshold renders a pleading irregular and liable to be struck.

Reasoning and analysis

The court first considered whether the defendants' motion had been brought promptly, as required by Rule 21.01(2). Given that roughly three and a half years passed between service of the claim and service of the motion record, the court found the motion was not prompt. Even so, it allowed the motion to proceed, reasoning that both sides bore responsibility for the litigation's slow pace and that genuine mediation efforts explained part of the delay; the lack of promptness was reserved for consideration on costs rather than treated as a bar to the motion.

On the claims against the individual defendants, the court applied the principle that corporate representatives are shielded from personal liability unless their conduct was itself tortious or displayed an identity separate from the corporation. The allegations against Watsa were limited to a vague reference to his personal connections being used for business development, with no suggestion he acted outside his role as Chancellor or engaged in any wrongdoing distinct from Huron's. The court struck the claim against him entirely. By contrast, the allegation that Seth personally took and used Higher-Edge's confidential intellectual property after leaving its employ was found to be at least legally tenable, so the claim against her survived on that basis.

Turning to the conspiracy claim, the court applied the established requirement that each defendant must be able to identify the co-conspirators, the object of the conspiracy, and the specific acts they are alleged to have committed in furtherance of it. The claim pleaded the two recognized forms of civil conspiracy—conspiracy to injure and conspiracy to commit an unlawful act—but did so ambiguously, without clarifying which was actually being advanced or what unlawful act, if any, was intended. Because the pleading required the defendants to piece together scattered allegations to understand the case against them, the court struck the conspiracy claim under Rule 25.11.

The court applied similar scrutiny to the intentional interference with economic relations claim, which requires an unlawful act directed at an identified third party that in turn causes the plaintiff's injury. The pleaded allegations were all directed at Higher-Edge itself, with no third party identified against whom an unlawful act was committed. A theory raised only in oral argument—that recruited students were the relevant third parties—was not reflected in the pleading itself, so the court struck this claim under both Rule 21.01(1)(b) and Rule 25.11.

The unjust enrichment claim fared differently. Read generously, it alleged that Huron and Seth used Higher-Edge's misappropriated intellectual property to profit while Higher-Edge lost corresponding value, with no juristic reason to justify retention of that benefit. The court found this sufficient to disclose the elements of enrichment, deprivation, and absence of juristic reason, and declined to strike it.

Ruling and overall outcome

The court struck the claim against Prem Watsa in its entirety and struck the conspiracy and intentional interference with economic relations claims against all remaining defendants, while allowing the breach of contract, breach of confidence, and unjust enrichment claims to proceed against Huron and Seth. Higher-Edge was granted 60 days' leave to amend its pleading with respect to the struck elements, and the court set directions for the defence, document exchange, discoveries, and a trial-readiness date of August 31, 2027. As this ruling addressed only the sufficiency of the pleadings rather than the merits of the underlying claims, no monetary award was made; the $1 million originally claimed remains unresolved pending further proceedings, and costs of the motion are to be determined through separate written submissions.