ONTARIO COURT OF APPEAL SUMMARIES (AUGUST 7 – 11, 2017)

Good afternoon,

Following are the summaries for this week’s two civil decisions of the Court of Appeal for Ontario.

In RBC Dominion Securities Inc. v. Crew Gold Corporation, the court applied familiar principles of contractual interpretation in affirming the lower court’s decision that had determined that RBC was not entitled to be paid a fee pursuant to an investment banking agreement when it had no involvement in the transaction that was ultimately concluded by its client.

In York University v Markicevic, the Court of Appeal granted security for costs of an appeal even though the appeal was found not to be frivolous, on the basis taht the appellant had been found liable in fraud and had attempted to put his assets beyond the reach of creditors, and had not challenged those findings.

Have a great weekend.

John Polyzogopoulos
Blaney McMurtry LLP
jpolyzogopoulos@blaney.com
Tel: 416 593 2953
http://www.blaney.com/lawyers/john-polyzogopoulos

Table of Contents

Civil Decisions

RBC Dominion Securities Inc. v. Crew Gold Corporation, 2017 ONCA 648

York University v. Markicevic, 2017 ONCA 651

For Criminal Decisions, click here.

Civil Decisions

RBC Dominion Securities Inc. v. Crew Gold Corporation, 2017 ONCA 648

[Weiler, van Rensburg and Huscroft JJ.A.]

Counsel:

J. Devereux and M. Bookman, for the appellants

A. Crawley and N. Vandervoort, for the respondent

Keywords: Contracts, Interpretation, Standard of Review, Palpable and Overriding Error, Factual Matrix, Plain Meaning, Commercial Reasonableness, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Salah v. Timothy’s Coffees of the World Inc., 2010 ONCA 673, Kentucky Fried Chicken v. Scott’s Food Services Inc. (1998), 41 B.L.R. (2d) 42 (Ont. C.A.)

Facts:

The appellants, RBC Dominion Securities Inc. and Royal Bank of Canada Europe Limited (together “RBC”), contracted with  the respondent, Crew Gold Corporation (“Crew”), to provide investment banking services (the “Agreement”).  RBC provided services under the Agreement to assist Crew in developing and implementing “strategic alternatives”. The Agreement provided for service fees based on specific work performed by RBC, and for a “Success Fee”, payable on completion of a “Transaction”, as defined by the Agreement. The agreement defined a “Transaction” as follows:

The Transaction “may involve (i) a sale of all or a substantial portion of the shares, business or assets of the Company to a third party, (ii) an investment by a third party in the Company that results in a change of control of the Company or (iii) an amalgamation, arrangement or other business transaction involving the Company and a third party to effect such sale or disposition”.

In the course of the Agreement, Crew, then a public company, was the subject of a takeover by Endeavour Financial Corporation (“Endeavour”) and OAO Severstal (“Severstal”) via the TSX and Oslo Stock Exchange, an event that was not anticipated by either party. The sole issue between the parties was whether, under the Agreement, RBC was entitled to a Success Fee in respect of any or all of the transactions involved in the takeover, even though it played no part in the transactions. RBC was of the view that Crew owed them the Success Fee, per the terms of the Agreement, and therefore sued Crew for its outstanding Success Fee Invoices.

At trial, RBC argued that the language of the Agreement was sufficiently broad and general so as to permit the claim, even though RBC was not involved in the Endeavour and Severstal purchases of Crew shares. Alternatively, RBC argued that the separate purchases by Endeavour and Severstal amounted to the sale of a “substantial portion of the shares… of the Company to a third party”. RBC relied on what it asserted was the expanded definition of Transaction in the definition of “Transaction Proceeds” to argue that these purchases constituted Transactions under the Agreement. RBC also asserted that, unlike the other fees payable under the Agreement, there was nothing to tie the Success Fee to services provided by RBC; and that the payment of the Service Fee depended only on the closing of a Transaction. Finally, RBC relied on the tail provision to argue that it was entitled to a Success Fee so long as a Transaction was concluded within 12 months of the termination of the Agreement, regardless of RBC’s contribution.

The trial judge found in favour of Crew. First, he noted there was no ambiguity in the language used in respect of the terms “Transaction” or “Success Fee”. He held that, in interpreting the term “Transaction” and determining the intention of the parties at the time the Agreement was drawn, it was too limiting to simply have regard to the preamble and the extended definition found in “Transaction Proceeds”, as proposed by RBC, and that regard must be had to the Agreement as a whole.

The trial judge concluded that RBC was not intended to receive a Success Fee unless there was some causal link between its activities and the completed transaction, even though RBC was not required to introduce the successful purchaser to the transaction and even though RBC’s involvement was not required to be a material cause of the transaction.

The trial judge then reviewed the factual matrix. He found that the entire thrust of RBC’s strategy after the debt restructuring was to maximize shareholder value by creating and rolling out an RBC Alternative, namely a process for the sale of Crew’s assets or control shares. RBC’s presentations all emphasized some form of an en bloc sale of assets or shares through a process orchestrated by RBC. RBC never spoke of the possibility of a third party purchase through stock exchanges. Further, it was “not on anyone’s radar” that any one of the RBC Alternatives would include a purchase of control through the acquisition of sufficient shares on the Oslo Stock Exchange, or that any purchaser would acquire a significant interest in Crew without a due diligence inquiry, which would have involved RBC.

RBC appealed.

Issues:

(1) Did the trial judge make extricable errors of law in his interpretation of the Agreement?

Holding: Appeal dismissed.

Reasoning:

(1) No. RBC advanced three separate arguments, which the Court of Appeal addressed in turn. In doing so, the court applied the deferential standard of review of “palpable and overriding error”, which is the standard applicable to issues of contractual interpretation involving issues of mixed fact and law (Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633). Furthermore, the court is to interpret a contract as a whole and in a way that gives meaning to all of its terms (Salah v. Timothy’s Coffees of the World Inc., 2010 ONCA 673).

i) The trial judge failed to consider the plain words of the Agreement in the context of the Contract as a whole

The Court held that RBC was essentially advancing the same arguments on this issue that it had a trial, and that the trial judge’s interpretation of these arguments was reasonable and in accordance with the accepted principles of contractual interpretation. Indeed, the Court noted that RBC’s approach to interpreting the contract was too narrow, and that had the trial judge adopted RBC’s approach, that would have constituted an extricable error of law. Similarly, the Court rejected RBC’s argument that the trial judge ignored certain of the Agreement’s provisions and certain case law.

ii) The trial judge improperly relied on the parties’ subjective intentions and failed to consider the objective surrounding circumstances

The Court rejected RBC’s argument that the trial judge relied on any evidence of the parties’ subjective intentions in interpreting the Agreement. In the Court’s view, the passages RBC relied on (which appeared to be every occasion where the trial judge used the words “intention” or “intended”) provided no support for this argument.

The Court put it quite bluntly that there was simply no merit to this ground of appeal. The trial judge did not make findings as to the parties’ subjective intentions in entering the Agreement, nor did he allow evidence of subjective intention to oust the plain words of the Agreement.

iii) The trial judge failed to consider the commercial reasonableness of the interpretation of the Agreement advanced by RBC

RBC argued that the trial judge adopted an interpretation of the Agreement that was not “in accordance with sound commercial principles and good business sense”, insofar as he failed to recognize the business reasons for allocating risk in contracts by providing for payment based on the occurrence of an event rather than services rendered.

The Court repeated its caution in Kentucky Fried Chicken v. Scott’s Food Services Inc. (1998), 41 B.L.R. (2d) 42 (Ont. C.A.) that the construction of contracts in accordance with sound commercial principles and good business sense must be performed objectively, rather than from the perspective of the contracting parties.

Notwithstanding that the trial judge did not analyze the parties’ arguments with respect to RBC’s expert evidence under a separate heading, the Court held that this did not mean that he ignored the commercial realities in interpreting the Agreement. Considerations of commercial reasonableness permeated his reasons. The trial judge made a specific finding on the evidence that was available that the parties anticipated a sale process. The expectation was that RBC would have provided services in connection to the process culminating in the closing of a Transaction to warrant payment of a Success Fee.

The Court therefore held that the trial judge’s interpretation was not commercially unreasonable and made commercial sense.

York University v. Markicevic, 2017 ONCA 651

[Epstein J.A. (In Chambers)]

Counsel:

W. C. McDowell and B. Kolenda, for the moving party

D. Zacks and J. Spotswood, for the responding party

Keywords: Civil Procedure, Appeals, Security for Costs, Fraud, Rules of Civil Procedure Rules 61.06(1)(a) to (c), 56.01

Facts:

After a lengthy trial, Michael Markicevic (“Markicevic”) was found to have defrauded York University (“York”) and was ordered to pay over $1.8 million in damages plus $1.37 million in costs. He was also found to have made fraudulent conveyances to his partner and daughter of certain property he owned. At the material time, Mr. Markicevic was the Assistant Vice-President of York’s Campus Services and Building Operations.

He appealed on two grounds: one concerning the implications of a mutual release  signed by all parties, and the other concerning whether York’s claims against him were statute-barred. York subsequently moved for security for costs of this appeal.

Issues:

(1) Should the court exercise its discretion to order security for costs?

Holding: Motion granted.

Reasoning:

(1) Yes. Epstein J.A. noted that according to Rule 61.06(1)(a) of the Rules, the court has the discretion to order security for costs where the appeal is frivolous and vexatious, and the appellant has insufficient assets in Ontario to pay the costs of the appeal. Applying the jurisprudence of Rule 56.01 (regarding security for costs at trial) by analogy, Epstein J.A. held that a finding that the responding party fits within the relevant provision of Rule 61.06 is not dispositive; rather, it triggers an inquiry into whether an order for security for costs would be just in the circumstances.

With respect to the facts of this case, Epstein J.A. was of the review that although Markicevic faced an “uphill battle” with respect to this appeal, his arguments with respect to the limitation period and the release were not without merit. Accordingly, she found that his appeal was neither frivolous nor vexatious. Similarly, the record made it clear that Markicevic was effectively without assets; notwithstanding that he had an interest in two separate properties, the numerous charges on and court orders in relation to them were such that Markicevic was unable to access the equity in those homes.

Turning to Rule 61.06(1)(c), Epstein J.A. noted that the rule also afforded her the discretion to order security for costs for “other good reason”. Canvassing the jurisprudence, Epstein J.A. noted that fraud has repeatedly been found to constitute “other good reason” and that notwithstanding Markicevic’s impecuniosity – along with the fact that an order for security for costs would potentially impair his ability to pursue his appeal – there were good reasons to order security for costs here.

In Epstein J.A.’s view, the fact that Markicevic did not challenge the finding of fraud, including a finding that he had attempted to put his assets beyond the reach of creditors, and other related findings favoured ordering security for costs. The fraud related to the purpose for ordering security, and permeated the entire analysis under r. 61.06(1), insofar as it was this same fraud that had largely contributed to his becoming impecunious. Epstein J.A. concluded by noting that although there were several factors militating in Markcevic’s favour (as outlined above), the unique circumstances of this case provided a compelling reason to make an order for security for costs.

Criminal Decisions

R v. Mallozzi, 2017 ONCA 644

[Feldman, Pardu and Benotto JJ.A.]

Counsel:

J. Presser and J. Marshman, for the appellant

B. Puddington, for the respondent

Keywords: Criminal Law, Production of Marijuana, Right to Trial, Unreasonable Delay, Mistrial, Defence Delay, Stay of Proceedings, s.11(b) of the Canadian Charter of Rights and Freedoms, R. v. Jordan, 2016 SCC 27, R v. Cody, 2017 SCC 31, R. v. Morin, [1992] 1 S.C.R. 771, R. v. Coulter, 2016 ONCA 704, R v. Gordon, 2017 ONCA 436

R v. A.N. (Publication Ban), 2017 ONCA 647

[Hoy A.C.J.O., Simmons and Brown JJ.A.]

Counsel:

C. Mainville, appearing as duty counsel

A.N., acting in person

T. Kozlowski, for the respondent

Key Words: Criminal Law, Sexual Assault, Indecent Assault, Evidence, Credibility, R. v. J.J.R.D. (2006), 215 C.C.C. (3d) 252 (CA), R. v. Kienapple, [1975] 1 S.C.R. 729

 R v. Lavergne (Publication Ban), 2017 ONCA 642

[Laskin, Simmons and Pardu JJ.A.]

Counsel:

A. Weisberg, for the appellant

C. Harper, for the respondent

Key Words: Criminal Law, Sexual Assault, Plea Bargain, Ineffective Assistance of Counsel, Sentencing, R. v. G.(D.M.), 2011 ONCA 343

R .v. Nicholas (Publication Ban), 2017 ONCA 646

[Gillese, Huscroft and Trotter JJ.A.]

Counsel:

D.J. Brodsky, for the appellant

J. Speyer, for the respondent

Key Words: Criminal Law, Break & Enter, Sexual Assault, Unreasonable Search and Seizure, Right to Counsel, Unlawful Detention, Canadian Charter of Rights and Freedoms, ss. 8 and 10(b)

R. v. Orlandis-Habsburgo, 2017 ONCA 649

[Doherty, Pepall and van Rensburg JJ.A.]

Counsel:

P. Lewin and J. Lloyd, for the appellants

B. Reitz, for the respondent

D. Guttman and M. Flanagan, for the intervener, Attorney General of Ontario

Key Words: Criminal Law, Production of Marijuana, Possession for the Purposes of Trafficking in Marijuana, Possession of the Proceeds of Crime, Search Warrants, Unreasonable Search and Seizure, Reasonable Expectiation of Privacy, Canadian Charter of Rights and Freedoms,  ss. 8 and 24(2), R. v. Gomboc, 2010 SCC 55, [2010] 3 S.C.R. 211

R. v. Robinson, 2017 ONCA 645

[Doherty, MacFarland and Paciocco JJ.A.]

Counsel:

J. Lockyer and J. Gemmell, for the appellant

C. Bartlett-Hughes, for the respondent

Key Words: Criminal Law, First-Degree Murder, Mens Rea, Juries, Instructions, Reasonableness of Verdict, , Evidence, Subsequent Conduct

Keywords: Criminal Law, Production of Marijuana, Right to Trial, Unreasonable Delay, Mistrial, Defence Delay, Stay of Proceedings, s.11(b) of the Canadian Charter of Rights and Freedoms, R. v. Jordan, 2016 SCC 27, R v. Cody, 2017 SCC 31, R. v. Morin, [1992] 1 S.C.R. 771, R. v. Coulter, 2016 ONCA 704, R v. Gordon, 2017 ONCA 436

R. v. Riley, 2017 ONCA 650

[LaForme, Watt and Trotter JJ.A.]

Counsel:

J. Wilkinson and M. Salama, for the appellant, Phillip Atkins

J. Lockyer and A. Ostroff, for the appellant, Jason Wisdom

J. Presser and N. Yanful, for the appellant, Tyshan Riley

R. Hubbard, K. Papadopoulos and H. Freeman, for the respondent

Keywords: Criminal Law, First Degree Murder, Unreasonable Search and Seizure, Canadian Charter of Rights and Freedoms, s. 8 and s. 24(2), Jury Selection, Challenge for Cause, Criminal Code of Canada, s. 640(2.1) and (2.2), Evidence, Bad Character, Joinder, Canada Evidence Act, R.S.C., 1985, c. C-5, s. 9(1), R. v. Vectrovec, [1982] 1 S.C.R. 811, R. v. Khela, 2009 SCC 4, R. v. Grant, 2009 SCC 32, R. v. Sherrat, [1991] 1 S.C.R. 590, R. v. Find, 2001 SCC 32, R. v. Litchfield, [1993] 4 S.C.R. 333, R. v. Last, 2009 SCC 45, R. v. Rojas, 2008 SCC 56, R. v. Daley, 2007 SCC 53, R. v. Goldhart, [1996] 2 S.C.R. 463, R. v. Perciballi (2001), 54 O.R. (3d) 346 (C.A.) R. v. Noureddine, 2015 ONCA 770, R. v. Husbands, 2017 ONCA 607, R v. Grant, 2016 ONCA 639, R. v. Murray, 2017 ONCA 393, R. v. V. (W.), 2017 ONCA 546, R. v. Brown (2002), 166 C.C.C. (3d) 570 (Ont. C.A.), R. v. Betker (1997), 115 C.C.C. (3d) 421 (Ont. C.A.), R. v. Moore-McFarlane (2001), 160 C.C.C. (3d) 493 (Ont. C.A.), R. v. Hubbert (1975), 29 C.C.C. (2d) 279 (Ont. C.A.), R. v. Gayle (2001), 154 C.C.C. (3d) 221 (Ont. C.A.), R. v. Rose (1997), 100 O.A.C. 67 (Ont. C.A.), R. v. Roks (2011), 274 C.C.C. (3d) 1 (Ont. C.A.), R. v. White, 2014 ONCA 64, R. v. James (2006), 84 OR (3d) 227 (C.A.), R. v. Kostyk, 2014 ONCA 447, R. v. Bradey, 2015 ONCA 73, R. v. Zebedee (2006), 81 O.R. (3d) 583 (C.A.), R. v. Rowe, 2011 ONCA 753, R. v. Murray, 2017 ONCA 393, R. v. Tran, 2010 ONCA 471, R. v. Gelle, 2009 ONCA 262, R. v. Figueroa, 2016 ONCA 645, R. v. Largie, 2010 ONCA 548, Trustcott (Re), 2007 ONCA 575

The information contained in our summaries of the decisions is not intended to provide legal advice and does not necessarily cover every matter raised in a decision. For complete information or for specific advice, please read the decision or contact us.

ONTARIO COURT OF APPEAL SUMMARIES (JULY 31 – AUGUST 4, 2017)

Good afternoon,

Following are the summaries for this week’s civil decisions of the Court of Appeal for Ontario.

Cheung v. York Region Condominium Corporation No. 759, 2017 ONCA 633, is a condominium law oppression remedy decision. At issue was what a commercial condo board was permitted to do to address a lack of parking issue created by the over-use of common element parking spaces by one unit-owner’s tenant (a busy restaurant). Notwithstanding the rather mundane issue in dispute, the court could not agree on the outcome, resulting in a split decision.

The majority (Justices Pardu and Benotto) held that a by-law which assigned four parking spots to each of the thirty-four unit owners (thereby prohibiting other unit owners from using those spaces) did not have the degree of permanence to amount to the creation of an exclusive use common element (the creation of an exclusive use common element is something that can only be done through a registered declaration). The majority agreed with and did not disturb the findings of the application judge, namely, that the by-law was reasonable and not oppressive.

In contrast, Justice Weiler, in dissent, held that although the application judge correctly held that a Corporation’s declaration does not have to specifically authorize leasing of common elements, he erred in not examining the actual wording of the by-law to ascertain if it was valid. Justice Weiler was of the view that the by-law purported to lease the parking spaces on a permanent or potentially permanent basis, effectively creating exclusive use common element parking spaces. As exclusive use common elements can only be designated through the declaration, the by-law was invalid. In addition, the by-law was unreasonable because there was no evidence that leasing four parking spaces per unit owner was necessary to alleviate the parking problems and a finding that overflow parking was available on adjacent lands was flawed.

Other topics covered included commercial leases, family law, real property, personal injury and wrongful dismissal.

Have a great weekend.

John Polyzogopoulos
Blaney McMurtry LLP
jpolyzogopoulos@blaney.com
Tel: 416 593 2953
http://www.blaney.com/lawyers/john-polyzogopoulos

Table of Contents:

Civil Decisions

Waterstone Properties Corporation v. Caledon (Town), 2017 ONCA 623

Keywords: Real Property, Conveyances, Equitable Interests in Land, Subdivision Agreements, Doctrine of Dedication and Acceptance, Limitation Periods, Real Property Limitations Act, ss. 4 and 5, Land Titles Act

Bonello v. Gores Landing Marina (1986) Limited, 2017 ONCA 632

Keywords: Torts, Negligence, Summary Judgment, Hryniak v. Mauldin, [2014] 1 S.C.R. 87, Appeals, Jurisdiction, Final or Interlocutory Orders, Evidence, Admissibility, Examinations for Discovery, Rules of Civil Procedure, R.R.O 1990, Reg. 194, r. 1.04, 20, 31.11(1), 39.04

Marsland Center Limited v. Wellington Partners International Inc., 2017 ONCA 631

Keywords: Real Property, Commercial Leases, Commercial Tenancies Act, R.S.O. 1990, c. L.7, ss. 48, 50, Summary Judgment, Hryniak v. Mauldin, 2014 SCC 7, Bruno Appliance and Furniture Inc. v. Hryniak, 2014 SCC 8

Gonsalves v. Scrymgeour, 2017 ONCA 630

Keywords: Family Law, Spousal Support, Child Support, Common Law Marriage, Division of Assets, Joint Family Venture, Unjust Enrichment, Kerr v Baranow, 2011 SCC 10, McNamee v McNamee, 2011 ONCA 533

Cheung v. York Region Condominium Corporation No. 759, 2017 ONCA 633

Keywords: Real Property, Condominiums, Oppression, Bylaws, Common Elements, Condominium Act, S.O. 1998, c. 19 s. 1(1), 7(2)(f), 7(4), 11(2)-(5), 21(1)(a), 21(2), 56(1), 56(6), 56(10), 58(1), 135(2), York Condominium Corp. No. 382 v. Dvorchik, [1997] O.J. No. 378 (C.A.), Orr. v. Metropolitan Toronto Corp. No. 1056, 2011 ONSC 4876, Standard of Review, Housen v. Nikolaisen, 2002 SCC 33

Nason v. Thunder Bay Orthopaedic Inc., 2017 ONCA 641

Keywords: Employment Law, Wrongful Dismissal, Disability, Duty to Accommodate,  Undue Hardship, Employment Contracts, Frustration, Human Rights Code, Fraser v. UBS, 2011 ONSC 5448

For Criminal Decisions, click here.

For Civil Endorsements, click here.

Civil Decisions:

Waterstone Properties Corporation v. Caledon (Town), 2017 ONCA 623

[Hourigan, Benotto and Roberts JJ.A.]

Counsel:

A. Davis and R. D. Davis, for the appellants

S. Leisk and M. Mahoney, for the respondent

Keywords: Real Property, Conveyances, Equitable Interests in Land, Subdivision Agreements, Doctrine of Dedication and Acceptance, Limitation Periods, Real Property Limitations Act, ss. 4 and 5, Land Titles Act

Facts: The appellants appeal from the dismissal of their application and the granting of the respondent’s application for a declaration that the respondent is the beneficial and legal owner of a 2.8-acre park known as the Kingsview Parkette (“the Parkette”) located in the Town of Caledon (“the Town”). The appellant, Waterstone Properties Corporation (“Waterstone”), and its predecessors in title are related companies, and held paper title to the Parkette. In 1972 and in 1973, members of this group of companies entered into subdivision agreements with the Town.

Among other terms, the subdivision agreements provided that the Parkette would be deeded to the Town for use as a park. While the Parkette was never formally transferred to or registered on title in the Town’s name, there is no dispute that, since 1974, the Town has had possession of the Parkette and that, since 1977 or 1979, the Town has used and operated the Parkette as a public park. On March 26, 1999, the Parkette was administratively converted into the Land Titles system in the name of Great Georgian Realty Group (“Great Georgian”) as owner. On May 7, 2013, the Parkette was transferred into the name of the appellant, Waterstone. On May 8, 2015, the Town asserted outright ownership of the Parkette and demanded a deed for nil consideration.

The appellants and the Town then commenced separate applications, each seeking a declaration of ownership of the Parkette. The application judge dismissed the appellants’ application, declared the Town the legal and beneficial owner of the Parkette, and made an order directing the Land Registrar to correct the parcel register to reflect the Town’s ownership, on the basis that the 1973 subdivision agreement superseded the 1972 subdivision agreement with respect to the conveyance of the Parkette, and the inclusion of the conveyance of the Parkette in the 1973 subdivision agreement was not a mistake. Moreover, the 1973 subdivision agreement created a constructive trust in favour of the Town as beneficial owner of the Parkette. Finally, the administrative transfer of the Parkette into the Land Titles system in 1999 had not extinguish the Town’s beneficial ownership of the Parkette. In the alternative, the Town had acquired ownership of the Parkette by application of the doctrines of adverse possession and dedication and acceptance.

Issues:

(1) Did the application judge err in determining that the 1973 subdivision agreement superseded the 1972 subdivision agreement?

(2) Did the administrative transfer of the Parkette into the Land Titles system in 1999 extinguish the Town’s beneficial ownership of the Parkette?

(3) Is any claim that the Town may have to the Parkette statute-barred under ss. 4 or 5 of the Real Property Limitations Act?

(4) Did the application judge err in determining that the Parkette was conveyed to the Town in accordance with the doctrine of dedication and acceptance?

Holding: Appeal dismissed.

Reasoning:

(1) No. The court held that the application judge found the subdivision agreements to be clear and unambiguous, with the 1973 agreement clearly not including a re-conveyance provision. The application judge rejected the appellant’s submission that the inclusion of the Parkette in the 1973 agreement was an error. The court held that those conclusions were open to the application judge on the evidentiary record before him and were subject to deference. The court saw no error in the application judge’s interpretation of the subdivision agreements and therefore had no basis to interfere.

(2) No. The court held that the appellant’s submissions on that point relied on the enforceability of the re-conveyance clause in the 1972 subdivision agreement. Since the court had already found the 1973 agreement to supersede it, there was no basis for this position. By virtue of the conveyance provisions in the 1973 agreement, the Town acquired a beneficial interest in the Parkette, of which the appellants had actual notice. The court held that although the deed was subsequently lost and title was mistakenly never registered in the Town’s name, there was actual notice of the Town’s equitable interest, and therefore the administrative conveyance of the Parkette into the Land Titles system was subject to the Town’s interest.

(3) No. The court held that although the Town’s claim to the Parkette was subject to the ten-year limitation period under s. 4 of the Real Estate Property Limitations Act, under s. 5(1) of the same Act, possession can operate to postpone the commencement of the limitation period, which would only start to run at the time of dispossession or discontinuance. The court found that there was no evidence the Town had ever been dispossessed or discontinued in its possession of the Parkette, and as a result the limitation period had never started to run.

(4) No. The court held that the application judge properly set out the two criteria for the doctrine of dedication and acceptance to apply: first that there was an actual intention to dedicate the land by the owner, and second, that it must appear that the intention was carried out in that the land was open for the public for use, and the public accepted it (Gibbs v Grand Bend (Village)). The court found that the application judge made several findings of fact supporting the conclusion that despite the Parkette never having been deeded to the Town, Waterstone’s predecessors had dedicated the Parkette as parkland for public use. The application judge also found that nearly four decades of public use of the Parkette as a park constituted acceptance by the public. The court held that those findings were open to the application judge on the record before him, and that the court saw no error in the application judge’s conclusion that the doctrine of dedication and acceptance applied and that the Town was therefore entitled to ownership of the Parkette.

Bonello v. Gores Landing Marina (1986) Limited, 2017 ONCA 632

[Sharpe, Tullock and Lauwers JJ.A.]

Counsel:
E.A. Cherniak, Q.C., G.T. Hnatiwn and D.E. Litwin, for the appellant

R.S. Balswin, for the respondents

Keywords: Torts, Negligence, Summary Judgment, Hryniak v. Mauldin, [2014] 1 S.C.R. 87, Appeals, Jurisdiction, Final or Interlocutory Orders, Evidence, Admissibility, Examinations for Discovery, Rules of Civil Procedure, R.R.O 1990, Reg. 194, r. 1.04, 20, 31.11(1), 39.04

Facts:

This appeal arises out of an injury sustained by the appellant while participating in a game of tug-of-war on a campground owned and operated by the respondents Gores Landing Marina (1986) Limited and its principal Joseph Davies Sr. (“Marina and Davies Sr.”).

The respondent, Joseph Davies Jr. (“Davies Jr.”), was added to the proceedings because of his role in finding the rope and making it available to the guests of the campground. The campground’s guests ask the respondent to provide a rope to play a game of tug-of-war. The rope had loops in it. While participating in a game of tug-of-war, the appellant put his arm through one of the loops and as the rope was pulled, the looped tightened and cinched on the appellant’s forearm, crushing it. The appellant ultimately had part of his arm amputated as a result of the injury.

Marina and Davies Sr. brought a summary judgment motion to have the main action against them dismissed. The motion judge struck some evidence from the affidavit of one of the people at the campground, as well as the discovery evidence of Davies Jr. and two other people at the campground. The motion judge ultimately granted summary judgment dismissing the action against the Marina and Davies Sr., but Davies Jr. did not defend the action against him and remains a defendant.

Issues:

(1) Is the order striking affidavit and examination for discovery evidence interlocutory and therefore only appealable to the Divisional Court?

(2) Did the motion judge err by excluding the discovery evidence of Davies Jr. and the two other people at the campground?

(3) Did the motion judge err in concluding that there was no genuine issue requiring a trial in relation to the Marina and Davies Sr.?

Holding: Appeal allowed.

Reasoning:

(1) No. The respondents submitted that the Ontario Court of Appeal does not have jurisdiction to hear evidence that the motions judge excluded from consideration on the basis that it is interlocutory, and that the appellants must seek leave to appeal from the Divisional Court instead. The evidence was not interlocutory because its exclusion was not a standalone order. Rather, it was an inextricable part of the decision to grant judgment. In addition, bifurcating the appeal by allowing some of the motion judge’s reasons to be appealable at the Ontario Court of Appeal and some at the Divisional Court will unduly complicate the appeal process. Such complication is contrary to rule 20 and rule 1.04 of the Rules of Civil Procedure, and the promotion of more efficient and less expensive access to justice as advocated by the Supreme Court of Canada in Hryniak v. Mauldin, [2014] 1 S.C.R. 87.

2) Yes. The motion judge concluded that since the Marina and Davies Sr. brought the motion, the discovery evidence of parties other than the Marina and Davies Sr. ought to be struck because evidence of one adverse party cannot be used against another adverse party. This reasoning is based on the motion judge’s interpretation of rules 31.11(1) and 39.04 of the Rules of Civil Procedure, which govern discovery evidence.

The motion judge interpreted rule 31.11 and 39.04 too rigorously. If the motion judge is invited to use the discovery evidence of one party against another adverse party as evidence establishing liability, the evidence may fall short of what is required. However, where the relevant issue on a motion is whether there is sufficient evidence to establish that there is a genuine issue requiring a trial, the discovery evidence is sufficient.

(3) Yes. The improperly excluded discovery evidence supports the assertion that there is a triable issue as to vicarious liability.

Marsland Center Limited v. Wellington Partners International Inc.,  2017 ONCA 631

[Simmons, Lauwers and Hourigan JJ.A.]

Counsel:

R.K. Thomson, for the appellant

S. Shoor, for the respondent

Keywords: Real Property, Commercial Leases, Commercial Tenancies Act, R.S.O. 1990, c. L.7, ss. 48, 50, Summary Judgment, Hryniak v. Mauldin, 2014 SCC 7, Bruno Appliance and Furniture Inc. v. Hryniak, 2014 SCC 8

Facts:

The appellant, Wellington Partners International Inc. (“Wellington”) was the tenant under a commercial lease with the respondent, Marsland Center Limited (“Marsland”), as landlord. The lease started on November 1, 2012, and was to terminate on October 31, 2017.

By the fall of 2013, Wellington was “suffering from business challenges and economic difficulties.” Marsland refused to grant rent relief to its tenant. On September 24, 2014, Wellington returned the keys and vacated the building. Marsland sued for damages in the amount of $200,000, representing the total rent owed through the term of the lease, together with costs.

On a motion for partial summary judgment, Marsland sought an order and declaration that Wellington was liable pursuant to s. 50 of the Commercial Tenancies Act (“Act”) for twice the value of certain goods and chattels removed from the premises. Prior to departure, Wellington removed most of its furnishings and other assets. The motion judge granted judgment, and Wellington appealed.

Issues:

(1) Did the motion judge properly exercise his authority under Rule 20 of the Rules of Civil Procedure?

(2) Did the motion judge properly apply ss. 48 and 50 of the Act?

Holding: Appeal allowed.

Reasoning:

(1) No. The motion judge failed to take into account the two-step analytical approach mandated by the Supreme Court in Hryniak v. Mauldin, 2014 SCC 7 (“Hryniak”) and Bruno Appliance and Furniture Inc. v. Hryniak, 2014 SCC 8.

The motion judge failed to address the second-step of Hryniak, which is whether and how the factual issues in dispute between the parties should be determined. There was no doubt that genuine factual issues existed between the parties on the evidence. Marsland denied giving permission for Wellington to remove their furnishings and other assets, whereas Wellington claimed that Marsland gave permission. These allegations were advanced through sworn affidavits.

While the motion judge recognized that the parties’ evidence seriously conflicted, he did not give effect to the dispute over the facts. As opposed to turning his mind to how the conflicts in the evidence were to be resolved, the motion judge simply picked one party’s version over the other.

Notwithstanding that Marsland’s version of events was more plausible, given that it was an experienced landlord that knew that the furnishings and assets were, in fact, or could be, its security for rent owed, this was not a proper basis on which to make a credibility finding in the circumstances of this case, where sworn statements were in conflict on a fundamental issue and where significant amounts of money were involved.

On this basis alone, the summary judgment was set aside.

(2) The court did not decide this issue, since the appeal was resolved on the basis of the first issue.

Gonsalves v. Scrymgeour, 2017 ONCA 630

[Sharpe, Lauwers and Roberts JJ.A.]

Counsel:

A. Finlayson, for the appellant

E. Birnboim and F. Yao, for the respondent

Keywords: Family Law, Spousal Support, Child Support, Common Law Marriage, Division of Assets, Joint Family Venture, Unjust Enrichment, Kerr v Baranow, 2011 SCC 10, McNamee v McNamee, 2011 ONCA 533

Facts:

The parties lived together in a conjugal relationship for over 16 years. They have three children, one of whom requires ongoing financial child support. The appeal and cross-appeal challenge the trial judge’s determinations in relation to the issues of spousal and child support, and the division of the value of the family home as an asset of a joint family venture. The trial judge granted judgment in favour of the respondent, determining as follows: (i) that there was a joint family venture and that the respondent was entitled to $595,530 as her share of the value of the family home; (ii) that $150,000 should be imputed to the appellant as annual income for the purposes of calculating spousal and child support; (iii) that the appellant pay costs fixed in the amount of $280,000.

Issues:

Appeal

(1) Did the trial judge err in his joint family venture/unjust enrichment analysis?

(2) Did the trial judge err in failing to deduct the deposit paid by the appellant and the outstanding mortgage on the family home?

(3) Did the trial judge err in imputing a total of $150,000 of annual income to the appellant?

Cross-Appeal

(1) Did the trial judge err in not imputing additional income to the appellant in relation to his inheritance from his father’s estate and to the value of the appellant’s shares in a business (GHL)?

Holding: Appeal granted, in part. Cross-appeal dismissed.

Reasoning:

Appeal

(1) No. The court held that the trial judge correctly famed his analysis for unjust enrichment, and concluded that there was both a disproportionate accumulation of assets by the appellant, linked to the respondent’s contributions to the parties’ joint family venture, and a corresponding deprivation and absence of juristic reason for the appellant’s disproportionate accumulation of assets. The court held that the trial judge’s conclusion was grounded in his detailed factual findings about the parties’ respective monetary and non-pecuniary contributions to their joint family venture, and that it was open to him to weigh the factual circumstances of the case as he did.

(2) Yes. The court held that since the trial judge accepted the evidence of the appellant and his brother that the balance of the mortgage was outstanding and had to be paid upon sale of the family home, it was not then open to him to ignore the ongoing liability for which the appellant would be solely responsible following the sharing of the value of the family home. The court found that the judge erred in not deducting the amount of the mortgage from the net value of the family home, and readjusted the respondent’s share to $527,000 rather than the $595,530 awarded by the trial judge.

(3) No. The court held that it was clear on the trial judge’s reasons that he rejected the appellant’s contention that his investment income for the last three years was anomalous and non-recurring. The trial judge found that the appellant received regular income from dividends and capital gains. The court held that these findings were open to the trial judge and there was no basis to interfere with them.

Cross-Appeal

The court held that the $1.3 million the appellant had inherited from his father was a legally valid gift to his brother, for the purpose of creating a scholarship at the University of Toronto, per their father’s wishes. The court found that there was no evidence that the appellant had access to any income or other benefits produced from that inheritance. The court held that there was no error of law or palpable or overriding error that would warrant interference with the trial judge’s finding that these circumstances did not justify imputing any additional income to the appellant.

As for the appellant’s interest in GHL, the court held that the trial judge’s findings that the appellant does not have access to GHL’s assets, nor the ability to require the sale of his shares or the declaration of dividends, is also entitled to deference and was open to the trial judge on the evidentiary record before him. The court held that the trial judge had included the dividends and other benefits that the appellant received from GHL in the calculation of his average income, and that to imputerfurther income from the same assets would amount to double-counting.

Cheung v. York Region Condominium Corporation No. 759, 2017 ONCA 633

[Weiler, Pardu and Benotto JJ.A.]

Counsel:

J. Fine, W. Pepall and J. Lurye, for the appellant

A. Casalinuvo and M. Molloy, for the respondent

Keywords: Real Property, Condominiums, Oppression, Bylaws, Common Elements, Condominium Act, S.O. 1998, c. 19 s. 1(1), 7(2)(f), 7(4), 11(2)-(5), 21(1)(a), 21(2), 56(1), 56(6), 56(10), 58(1), 135(2), York Condominium Corp. No. 382 v. Dvorchik, [1997] O.J. No. 378 (C.A.), Orr. v. Metropolitan Toronto Corp. No. 1056, 2011 ONSC 4876, Standard of Review, Housen v. Nikolaisen, 2002 SCC 33

Facts:

The Condominium Corporation (the “Corporation”) passed a by-law that attempted to solve a longstanding parking lot dispute in the common element parking areas of its commercial complex. The complex consisted of thirty-four units; Cheung owned three. Cheung leased her units to a very popular restaurant.

There were one hundred sixty-two common element parking spaces. Cheung stated she “needed” all of them “because a two hundred thirty seat restaurant requires the use of a sufficient number of parking spaces to accommodate its patrons.” The other unit owners also wanted to use the parking spaces.

There were altercations among restaurant customers, between restaurant customers and other customers, and between restaurant customers and business owners within the complex.” The restaurant was very busy during its peak hours, 9:00 AM to 3:00 PM and after 5:00 PM. Other unit owners complained that they were losing customers because of the crowded and “toxic” parking lot. In addition, patrons would at times park illegally by blocking the fire routes, accessible parking spaces, or double-parking other vehicles.

In 2009, the Corporation attempted to solve this problem by passing a by-law to allocate two parking lots to each unit owner, but that by-law was invalid because it was never registered on title. In 2015, the Corporation made another attempt, adopting a by-law that provided the Corporation could “from time to time” grant a lease to each owner of four parking spaces in the common element parking spaces on such terms and conditions “as may be deemed appropriate by the Board of Directors from time to time.” The by-law did not include these terms and conditions.

Issues: [as framed by the dissent]

(1) Did the application judge err in holding the 2015 by-law was valid?

(2) Did the application judge err in concluding the 2015 by-law was reasonable?

(3) Did the application judge err in concluding the 2015 by-law did not violate s. 135 of the Act?

(4) Did the application judge err in awarding $60,000 in costs to the Corporation?

Majority: [Pardu and Benotto JJ.A.]

Holding: Appeal dismissed.

Reasoning:

Cheung argued that the by-law was invalid because it in effect created “exclusive use common elements.” Cheung argued that, based on the declaration, she expected that she could use all of the common element parking spaces on the property, and this expectation was integral to her decision to acquire the units.

The Court found that the by-law passed by the Corporation did not have the degree of permanence to amount to, in effect, the creation of exclusive use common elements which would pass with ownership of a unit. The Board of Directors (the “Board”) could repeal or vary the by-law at any time. All unit owners reasonably share the parking spaces. There is no valid expectation that a right to exclusive use of parking spaces exists.

(2) No. The majority framed the second issue in terms of whether the by-law was void for uncertainty. The majority considered s. 135 (Oppression Remedy) and whether the by-law was reasonable under the third issue. Since the Corporation was waiting on the conclusion of litigation, it has not executed the leases contemplated by the by-law. More consideration is required to execute the proposal embodied in the by-law, as the terms of the leases will have to be approved by the Board, but that does not make the by-law void for uncertainty.

(3) No. The application judge concluded that the by-law was reasonable; there was a parking problem and it needed to be remedied. The application judge relied on the proposition that it was not the court’s place to substitute its judgment for that of the Board’s unless the by-law was clearly unreasonable or contrary to the Act or the declaration: York Condominium Corp. No. 382 v. Dvorchik, [1997] O.J. No. 378 (C.A.) at paras 5-6. Whether the by-law was reasonable or was oppressive was a question of mixed fact and law and was owed deference: Housen v. Nikolaisen, 2002 SCC 33 at para. 36.

Further, the application judge properly noted that the purpose of s. 135 is to protect reasonable expectations. Relying on Orr. v. Metropolitan Toronto Corp. No. 1056, 2011 ONSC 4876 at para. 158, the application judge noted that “… the section protects the legitimate expectations and not individual wish lists… the court must balance the objectively reasonable expectations of the owner with the [Board’s] ability to exercise judgment and secure the safety, security and welfare of [all unit owners, property, and assets].”

The application judge concluded that Cheung’s expectation that her tenant should be able to use all of the common area parking spaces was unreasonable and amounted to an allegation that the Board acted unfairly by not giving her special parking privileges not enjoyed by other owners.

(4) No. Given the near parity of the partial indemnity costs claimed by each party, and taking into account the offer to settle made by the Corporation, the global amount of $60,000 awarded by the application judge was well within the range of what a losing party would expect to pay in costs, regardless of the uncivil conduct of either party and their respective counsel.

Dissent: [Weiler, J.A.]

Holding: Would have allowed the appeal.

Reasoning:

(1) Yes. Notwithstanding the fact that the passing of a by-law to lease does not affect the interest of an owner in the common elements, what the Corporation did here was pass a by-law allowing it to enter into leases, skip entering into any leases, but nonetheless adversely affect Cheung’s interest in the common elements by permitting other owners to erect and maintain private parking signs. These leases must be valid to affect Cheung’s interest in the common element parking. Leases cannot be granted in perpetuity.

The uncertainty created by a by-law providing for a lease for an indeterminate period makes it impossible to determine the integrity of title in the common elements until a lease is actually entered into. This uncertainty is impermissible. As the 2015 by-law allocated four common element parking spaces to each owner for each owner’s exclusive use on a permanent basis or for an indeterminate period, it contravenes the Act and is invalid.

(2) Yes. Since the 2015 by-law is invalid, no deference is owed to the Board’s decision to pass it. Apart from this conclusion, the 2015 by-law is still unreasonable. Not only was there no evidence, expert or otherwise, to suggest that assigning four parking spaces would alleviate the parking difficulties, the application judge also made a processing error by finding that there was overflow parking available on adjacent lands, which there was not. Given the application judge’s finding that other businesses often have empty spots when the restaurant is at peak capacity, the 2015 by-law assigning four parking spaces per unit was not within a range of reasonable choices that the Board could have made in weighing conflicting interests.

(3) No. The application judge did not err in his approach under s. 135 of the Act. The finding that Cheung’s expectation was unreasonable was a finding of mixed fact and law and is owed deference. It was and is unreasonable for Cheung to ignore her fellow unit owners’ interests.

(4) Yes. Both parties have achieved partial success. The dissent would have granted leave to appeal costs, and would have set aside the application judge’s award of costs and ordered that each party bear their own costs throughout. Cheung submitted that she should not have to pay her share of the costs of the litigation for which she, as a unit owner, is liable. This position was rejected since, as provided for in the Act, Cheung is required to bear her share of the common expenses, of which this litigation is one such expense.

Nason v. Thunder Bay Orthopaedic Inc., 2017 ONCA 641

[Strathy C.J.O., Gillese and Pardu JJ.A.]

Counsel:

D. Matson, for the appellan

D. Shanks and J. Lester, for the respondent

Keywords: Employment Law, Wrongful Dismissal, Disability, Duty to Accommodate,  Undue Hardship, Employment Contracts, Frustration, Human Rights Code, Fraser v. UBS, 2011 ONSC 5448

Facts:

The appellant worked for the respondent as an orthotic technician. He developed problems with his arms and hands as a result of the physical demands of his work. The respondent placed him on a medical leave of absence on August 18, 2010, and terminated his employment on January 22, 2013.

The appellant sued for wrongful dismissal and for damages under the Human Rights Code for his employer’s failure to accommodate his disability and for disability related discrimination. The trial judge awarded damages for wrongful dismissal equal to 15 months’ pay in lieu of notice, net of WSIB benefits the appellant received during that period, plus $10,000 in damages for breach of the Human Rights Code, finding that the disability was a factor in the respondent’s decision to terminate the appellant’s employment.

The appellant submits that the trial judge erred by refusing to award him additional damages for loss of income between August 18, 2010, and January 22, 2013. The respondent cross-appealed, submitting that the trial judge erred by failing to find that the employment contract was frustrated by the appellant’s disability.

Issues:

(1) Did the trial judge err in concluding that the respondent accommodated the appellant’s disability to the point of undue hardship?

(2) Did the trial judge err in finding that the employment contract was not frustrated by the appellant`s disability?

Holding: Appeal and cross-appeal dismissed.

Reasoning:

(1) No. A determination of whether an employer has accommodated a disabled employee to the point of undue hardship must take account of the specific fact situation and apply common sense. An employer is not required to create a new position for the employee. An employer is not required to make fundamental changes to the employee’s job scope or working conditions. Hardship becomes undue when an employee is no longer able to fulfill the basic obligations of his employment position, despite accommodations.

The respondent made several efforts to accommodate the appellant`s disability, including changing the appellant`s work duties, modifying the required work pace and allowing discretionary breaks to rest and stretch. He was also allowed extensive paid time off to attend physiotherapy and medical appointments. However, the appellant’s condition continued to deteriorate and his productivity declined to the point where it was 50% or less of what it should have been. This resulted in the respondent being forced to pay the other technicians overtime pay, which was not sustainable for a specialized small business of this nature.

(2) No. The issue of whether the termination of the employment contract of a disabled employee is a wrongful dismissal or the frustration of the employment contract depends on the facts. Where an employee is permanently unable to work because of a disabling condition, the doctrine of frustration of the employment contract depends on the fact of the case. Where an employee is permanently unable to work because of a disabling condition, the doctrine of frustration of contract applies because the permanent disability renders performance of the employment contract impossible, such that the obligations of the parties are discharged without penalty. Frustration of contract is established if at the time of termination there is no reasonable likelihood of the employee being able to work with a reasonable time. The onus is on the employer to prove that the contract was frustrated.

The respondent did not establish that there was no reasonable likelihood of the appellant’s ability to return to work within a reasonable time. The respondent terminated the appellant’s employment only a week after sending a letter that said it would re-evaluate the appellant’s desire to return to work if and when he was medically cleared. However, the respondent terminated the appellant before he could produce evidence establishing that there was a reasonable likelihood of an ability to return to work within a reasonable time.

Criminal Decisions

R. v. Aviles, 2017 ONCA 629

[Feldman, Watt and Huscroft JJ.A.]

Counsel:

M. Halfyard and B. Vandebeek, for the appellant

J. Streeter, for the respondent

Keywords: Criminal Law, Assault, Carrying Concealed Weapon, R. v. Kelsy, 2011 ONCA 605, 289 C.C.C. (3d) 456, Canadian Charter of Rights and Freedoms, s. 9

R. v. Strauss, 2017 ONCA 628

[Watt, Benotto and Roberts JJ.A.]

Counsel:

J. Lockyer and R. Posner, for the appellant

K. Rawluk, for the respondent the Attorney General of Ontario

B. Reitz, for the respondent the Attorney General of Canada

Keywords: Criminal Law, Unreasonable Search and Seizure, Search Warrants, R. v. Grant, 2009 SCC 32, [2009] 2 S.C.R. 353, Canadian Charter of Rights and Freedoms, s. 24(2)

R. v. Rutledge, 2017 ONCA 635

[Watt, Benotto and Roberts JJ.A.]

Counsel:

A. Faith, for the appellant

M. Fawcett, for the respondent

Keywords: Criminal Law, Evidence, R. v. MacDonald, 2014 SCC 3, [2014] 1 S.C.R. 37, R. v. Dyment, [1988] 2 S.C.R 417, R. v. Cornell, 2010 SCC 31, [2010] 2 S.C.R. 142, Canadian Charter of Rights and Freedoms, s. 8

R. v. Oliveros-Callejas (Appeal Book Endorsement), 2017 ONCA 636

[Hoy A.C.J.O., Simmons and Brown JJ.A.]

Counsel:

V. Rondinelli, for the appellant

M. Oliveros-Callejas, appearing in person

M. Bernstein, for the respondent

Keywords: Criminal Law, Joint Submission, R. v. Anthony-Cook, [2016] 2 S.C.R. 204

R. v. Rafilovich, 2017 ONCA 634

[Weiler, Hourigan and Pardu JJ.A.]

Counsel:

B. Reitz and S. Egan, for the appellant

G. Lafontaine, for the respondent

Keywords: Criminal Law, Forfeiture of Proceeds of Crime, Forfeiture of Offence-Related Property, Criminal Code, s. 462, R. v. Lavigne, 2006 SCC 10, [2006] 1 S.C.R. 392

R. v. Abbey (Publication Ban), 2017 ONCA 640

[Doherty, Laskin and Roberts JJ.A]

Counsel:

D. Harris and R. Pillay, for the appellant

A. Alvaro, for the respondent

Keywords: Criminal Law, First Degree Murder, Criminal Code, s. 486.4, s. 486.5. s. 486.6, s. 683(1), Fresh Evidence, Palmer v. The Queen, [1980] 1 S.C.R. 759, Truscott (Re), 2007 ONCA 575, 225 C.C.C. (3d) 321

R. v. Byers (Publication Ban), 2017 ONCA 639

[Laskin, Simmons and Pardu JJ.A.]

Counsel:

M. Gourlay, for the appellant

E. Nakelsky, for the respondent

Keywords: Criminal Law, Attempted Kidnapping, Attempted Aggravated Assault, Criminal Code, s. 486.4, s. 486.5. s. 486.6, s. 683(1), R. v. Geddes (1996), 160 J.P. 697 (Eng. C.A. (Crim. Div.)), R. v. Campbell (1991), 93 Cr. App. R. 350 (Eng. C.A. (Crim. Div.))

R. v. Floward Enterprises Ltd. (H. Williams and Co.), 2017 ONCA 643

[Gillese, Huscroft and Trotter JJ.A.]

Counsel:

P. Adam, for the appellant, the Estate of Martin Winberg

J. Green, for the respondent, Floward Enterprises Ltd.

M. Fawcett, for the respondent, Her Majesty the Queen

Keywords: Criminal Law, Costs, Criminal Code, s. 490(7), s. 490(9)(c), R. v. Geauvreau, [1982] 1 S.C.R. 485

R. v. MacKenzie, 2017 ONCA 638

[Laskin, Simmons and Pardu JJ.A.]

Counsel:

F. Miller, for the appellant

K. Farrell, for the respondent

Keywords: Criminal Law, Wilfully and Unnecessarily Causing Pain and Suffering, Animal Cruelty, Criminal Code, s. 445(1), s. 445.1(1)

Civil Endorsements

Agnus v. Port Hope (Municipality), 2017 ONCA 637

[Strathy C.J.O., Gillese and Pardu JJ.A.]

Counsel:

C. Paliare, R. Stephenson and L. Scott, for the appellant

A. Lenczner and P. Veel, for the respondent

Keywords: Costs

ONTARIO COURT OF APPEAL SUMMARIES (JULY 24 – 28, 2017)

Good afternoon,

Following are the summaries for this week’s civil decisions of the Court of Appeal for Ontario. There were few decisions and nothing particularly noteworthy. Topics covered include the interpretation of the scope of a personal guarantee of corporate debt, agreements of purchase and sale of land, SABs, adjournments and frivolous and vexatious claims.

Have a great weekend.

John Polyzogopoulos
Blaney McMurtry LLP
jpolyzogopoulos@blaney.com
Tel: 416 593 2953
http://www.blaney.com/lawyers/john-polyzogopoulos

Table of Contents

Civil Decisions

Dittman v. Aviva Insurance Company of Canada, 2017 ONCA 617

Lala v. Basman Smith LLP, 2017 ONCA 614

Preiano v. Cirrillo, 2017 ONCA 615

Khan v. Krylov & Company LLP, 2017 ONCA 625

Callidus Capital Corportion v. McFarlane, 2017 ONCA 626

For Civil Endorsements, click here.

For Criminal Decisions, click here.

Civil Decisions

Dittman v. Aviva Insurance Company of Canada, 2017 ONCA 617

[Sharpe, Lauwers and Roberts JJ.A.]

Counsel:

K. Schultz and C. Macauley, for the appellant

M. Gauthier and J. Ross, for the respondent

Keywords: Insurance Law, Statutory Accident Benefits Schedule, s 3

Facts:

The respondent sustained serious burns to her lower body when the entire contents of a coffee cup she ordered at a McDonald’s drive-through spilled as she attempted to transfer the cup from the drive-through window to the cup holder in her vehicle. The motion judge determined that the respondent was impaired as a result of an accident as defined in the Statutory Accident Benefits Schedule and accordingly that she was entitled to statutory accident benefits in accordance with her insurance policy.

Issues:

(1) Did the motion judge err in his application of the Statutory Accident Benefits causation test?

Holding: Appeal Dismissed.

Reasoning:

(1) No. The court held that the motion judge had properly applied the SABs causation test. The use and operation of the respondent’s vehicle was a direct cause of the respondent’s injuries. The court held that these findings were justified on the evidence and met the requirements of the direct causation test prescribed in the SABs regulation. Moreover, the restraint of the seatbelt had increased the exposure of the respondent to the scalding liquid and thereby increased the level of her impairment. The court held that the issue is not what the triggering event of the incident was, but rather, what caused the impairment.

Lala v. Basman Smith LLP, 2017 ONCA 614

[Sharpe, Lauwers and Roberts JJ.A.]

Counsel:

K. W. Fisher, for the appellant

A. Pantel, for the respondent

Keywords: Solicitor and Client, Assessment of Accounts, Procedural Fairness, Adjournments, Igbinosun v Law Society of Upper Canada, 2009 ONCA 484

Facts:

The appellant law firm appealed an order of the motion judge setting aside a report and certificate of assessment. The motion judge had ruled that the assessment officer had erred by failing to grant an adjournment when the respondent client did not attend the first day of a scheduled five-day hearing due to a communication error by court staff and that, as a result, the officer deprived the respondent of her right to a fair hearing.

The respondent had initiated the assessment in February 2014 to question the appellant’s account. At a preliminary appointment, a mediation was scheduled at the respondent’s request. The respondent was ordered to provide the appellant with a list of her issues or concerns regarding the account at least 30 days prior to the mediation. She failed to do so, and she cancelled the mediation one day prior to its schedule date. The assessment office and the appellant made several unsuccessful attempts to contact the respondent to schedule a hearing date. Eventually, in February 2015, the office scheduled a five-day assessment hearing, which due to a backlog was scheduled for one year later, on March 14, 2016. About five days before the assessment hearing was to commence, respondent’s counsel called the assessment office. In her reasons, the assessment officer indicated that she had checked with the staff and determined that respondent’s counsel was told that the assessment would “likely not proceed” on the scheduled date. Respondent’s counsel insisted that he was told that the assessment would not proceed. Due to this miscommunication, on the first day of the hearing, neither the respondent nor her counsel attended. The assessment office spoke to the respondent in the afternoon regarding the miscommunication and the remainder of the first day of hearing was adjourned. The following day, respondent’s counsel attended but the respondent did not. The assessment officer offered to make accommodations but counsel refused to discuss it and insisted that the matter be adjourned. The assessment officer refused, and respondent’s counsel left the hearing. On March 18, 2016, the assessment officer issued oral reasons approving the appellant’s accounts and the report and certificate of assessment.

On March 29, 2016, respondent’s counsel issued and served a notice of motion to oppose confirmation of the report and certificate of assessment. The appellant wrote to respondent’s counsel requesting that the motion be heard at an earlier date and that respondent’s counsel provide materials in support of the motion. No materials were provided and that motion was not heard. The respondent then retained new counsel and, on October 28, 2016, her new counsel issued a new notice of motion to oppose confirmation of the report and certificate of assessment. The motion to oppose confirmation was finally heard on November 17, 2016, and the motion judge ruled that the assessment officer had erred in refusing an adjournment and that the respondent had thereby been denied procedural fairness. The report and certificate of assessment were set aside. The law firm appealed.

Issues:

(1) Did the trial judge err in setting aside the report and certificate of assessment?

Holding: Appeal allowed.

Reasoning:

(1) Yes. The court held that it was clear from the transcript that the assessment officer had been alert to the problems created by the miscommunications, and had been prepared to give the respondent and her counsel the benefit of the doubt. The court found that the assessment officer properly based her decision to refuse the adjournment on her overall consideration of the conduct of both parties, of the inconvenience and cost of a further delay in the assessment, and on the steps that could have been taken to relieve any procedural unfairness to the respondent. The court held that the assessment officer was entitled to take into account the respondent’s failure to provide a list of issues or concerns as ordered to do so, her cancellation of the mediation on one day’s notice, and the fact that in view of the backlog in the assessment office, there would be another lengthy delay in rescheduling the hearing (see Igbinosun v Law Society of Upper Canada, 2009 ONCA 484 at para 37). Respondent’s counsel was not prepared to engage in any discussion or to entertain any possibility other than that the matter be adjourned and he left refusing to participate further in the process. The court held that in the circumstances, it was reasonable for the assessment officer not to accept the only option proposed by the respondent, namely to adjourn and restart the hearing. The court found that the motion judge had failed to give adequate deference to the assessment officer’s decision.

Preiano v. Cirillo, 2017 ONCA 615

[Sharpe, Lauwers and Roberts JJ.A.]

Counsel:

M.Freeman and V. Msi, for the appellants

B. Hahn, for the respondents

Keywords: Contracts, Real Property, Agreements of Purchase and Sale of Land, Conditions, Time of the Essence, Specific Performance, Civil Procedure, Determination of Question of Law, Rules of Civil Procedure, R. 21.01(1)(a)

Facts:

The appellant purchasers sued the respondent vendors for specific performance of an Agreement of Purchase and Sale regarding the respondents’ home (the “APS”). The respondents brought a motion for the determination of a question of law under r. 21.01(1)(a) of the Rules of Civil Procedure.

On August 20, 2013, at the time they signed the draft APS by which they offered to buy the respondents’ house, the appellants delivered a $25,000 personal cheque as the deposit to Frank Finelli of Royal LePage, the respondents’ real estate agent. Mr. Finelli told the appellants that the personal cheque would have to be replaced with $25,000 in certified funds if the respondents accepted the APS. On behalf of Royal LePage, Mr. Finelli retained the appellants’ personal cheque although he did not attempt to deposit it.

The parties reached agreement at 12:30 p.m. on August 21, 2013. The APS required the appellants to pay the deposit of $25,000 within 24 hours of the acceptance. They delivered $25,000 in certified funds in the form of a bank draft to the deposit holder, Royal LePage, by 1:53 p.m. on August 23, 2013.  The APS stated that “time shall be of the essence”. Royal LePage provided the appellants with a receipt for their deposit. Six days before the scheduled closing date, counsel for the respondents wrote to the appellants’ real estate lawyer asserting that there was no valid APS because of the late receipt of the deposit.

The motion judge found that, because the bank draft was delivered a day late, there was no APS in effect to be specifically performed and he dismissed the action on that basis. The motion judge also found that the personal cheque was “not capable of yielding funds upon negotiation” because the record of the chequing account, which was admitted by the appellants to be authentic, did not show a balance that could accommodate payment of the cheque.

Issues:

(1) Was it open to the motion judge to dismiss the action because there was no APS in effect?

Holding: Appeal allowed.

Reasoning:

(1) No. The Court of Appeal found that the motion judge’s order must be set aside because the evidentiary record was not sufficient for the motion judge to draw the inference that the cheque was not negotiable. The motion judge made the error of interpreting the admission that the bank statement was authentic as an admission that the appellants did not have the money to pay the cheque, so that upon presentation, it would have been dishonoured by the bank. The Court stated that this additional inference was not open to the motion judge, per Wunsche v. Wunsche, 18 O.R. (3d) 161, [1994] O.J. No. 816 (C.A.), at para. 19 (QL).

The Court of Appeal stated that there was no evidence that the bank would not have honoured the cheque, nor was there evidence in the record as to the appellants’ financial capacity or their arrangements with the bank. However, the Court found that there was evidence that within two days the appellants were able to provide a bank draft in the appropriate amount, and that on this basis alone the order should be set aside. The respondents’ action was restored.

Khan v. Krylov & Company LLP, 2017 ONCA 625

[Pepall, Lauwers and Huscroft JJ.A.]

Counsel:

Zaka Ullah Khan, appellant, acting in person

B. R. Moodie, for the respondent, Krylov & Company

L. Covens, for the respondent, Devry Smith Frank LLP

Keywords: Civil Procedure, Vexatious Litigants, Frivolous and Vexatious Proceedings, Rules of Civil Procedure, r. 2.1.01

Facts:

The motion judge dismissed the appellant’s action under rule 2.1.01 of the Rules of Civil Procedure as being frivolous, vexatious or otherwise an abuse of the process of the court. The respondent, Krylov & Company, represented the appellant in his claim for damages arising from a motor vehicle accident. The respondent, Devry Smith Frank LLP acted for the defendant in that action. The appellant subsequently sued both respondents in the action that is the subject matter of the r. 2.1.01 dismissal. At the heart of this action as asserted by the appellant in the statement of claim is the allegation that both respondent law firms (his own, Krylov, and the defendant’s lawyers, Devry), defrauded the appellant by misappropriating settlement funds (giving him only less than $60,000 and allegedly keeping a further $740,000 or so for themselves) and forging his name to a final release or having him sign such a release without knowledge of its contents.

Issues:

(1) Did the motion judge err is dismissing the appellant’s action under rule 2.1.01?

Holding: Appeal allowed.

Reasoning:

(1) Yes. The court stated that the use of rule 2.1 should be limited to the clearest of cases where the abusive nature of the proceeding is apparent on the face of the pleading and there is a basis in the pleadings to support the resort to the attenuated process. The court held that the pleading alleges that the respondent law firms settled the motor vehicle action for much more than they told the appellant, and pocketed the difference. The court found that as distasteful as this allegation may be, it was not entirely implausible, and that a cautious approach had to be taken. The court held that rule 2.1 is an extremely blunt instrument which must be reserved for the clearest of cases, and is not meant to be an easily accessible alternative to a pleadings motion, a motion for summary judgment, or a trial. Here, the statement of claim bore none of the hallmarks of a vexatious pleading. The court held that nothing on the face of the statement of claim showed the appellant to be a vexatious litigant, nor was there any suggestion in the material that the appellant would abuse the process of the court if he was confronted by other motions such as a motion for summary judgment at the instance of the respondents. The court held the motion judge had erred in truncating the normal process, allowed the appeal and set aside the order of the motion judge.

Callidus Capital Corporation v. McFarlane, 2017 ONCA 626

[Feldman, Gillese and Pepall JJ.A.]

Counsel:
S. Zucker and M.L. Solmon, for the appellant

L.S. Corne and J.D. Leslie, for the respondent

Keywords: Contracts, Debtor-Creditor, Guarantees, Interpretation, Sattva Capital v. Creston Moly, [2014] 2 SCR 663

Facts:

This appeal arises from a summary judgment granted against the appellant. The appellant provided a personal guarantee to the Royal Bank of Canada and PNC Bank on behalf of a technology company called Xchange Technology Group LLC (the “Company”). The respondent, a high-risk distressed debt lender, purchased the Company’s debt from PNC Bank. The appellant’s personal guarantee was then transferred to the respondent.

The Company defaulted on its obligations to the respondent. In June 2013, a forbearance agreement was negotiated between the respondent and the company which would delay enforcement of remedies under the loan agreement. The appellant expressed discontent with fees the respondent was charging, including a US$2.25 million facility fee. At this point, he insisted that he would not be responsible for any Company debt that came from the respondent’s fees.

In conjunction with the forbearance agreement, the appellant’s guarantee was amended. The amended guarantee included provisions to make the appellant step away from management of the Company, and provide the respondent with mortgage security over property that the appellant owned. This amended guarantee was stated to be a continuing guarantee that would cover and secure any ultimate balance owing, and stated that the respondent was not obliged to seek recourse against the borrowers or other persons or the security it held.

In July 2013, the respondent demanded payment from the Company and put the appellant on notice for payment as guarantor. In August 2013, another forbearance agreement was entered into extending the date of debt enforcement for two weeks, and charging the Company a forbearance fee of $250,000. In October 2013, the respondents commenced court proceedings to initiate the sale process of the Company. The Company’s total debt on closing was US$37 million, with US$3 million being owed by the Company to the respondent.

The respondents then brought suit against the appellant on his guarantee and brought a motion for summary judgment. The appellant argued that his guaranteed debt was limited to US$250,000, which accounts for the Company’s total debt minus the respondent’s facility and forbearance fees, as per the amended guarantee signed in June 2013. The appellant was ultimately ordered to pay US$3 million plus interest at 21%, and costs, and now appeals this decision on the basis of the motion judge’s calculation of the amount owing.

Issues:

(1) Did the motion judge err in his calculation of the amount due by the appellant?

Holding: Appeal allowed.

Reasoning:

(1) Yes. In absence of an extricable error of law or a palpable and overriding error of fact, deference is owed to a motion judge’s decision (Sattva Capital v. Creston Moly, 2014 SCC 53, [2014] 2 SCR 663.  The motion judge erred in law by failing to consider the part in the amended guarantee that reduces the Company’s obligations to the respondent. In addition, the motion judge made a palpable and overriding factual and mathematical error in calculating the amount owed by the Company.

The respondent’s position was that all of the outstanding US$3 million that was owed by the Company to the respondent was covered by the appellant’s guarantee, however, this is incorrect. As per the amended guarantee, the appellant’s guarantee did not cover facility and forbearance fees. The total facility and forbearance fees totalled US$2.75 million. Therefore, the amount owed by the appellant is the outstanding amount of US$3 million, less the fees of US$2.75 million. Accordingly, the appeal was allowed and the amount to be paid by the appellant is reduced from US$3 million to US$250,000.

Civil Endorsements

Jo-Zen Investments Limited v Kung Tai Enterprises (Canada) Ltd, 2017 ONCA 616

[Sharpe, Lauwers and Roberts JJ.A.]

Counsel:

F. Wong, for the appellant

E. Sherkin, for the respondent

Keywords: Appeal Book Endorsement, Contracts

Criminal Decisions

v. Tossounian, 2017 ONCA 618

[Juriansz, Pepall and Trotter JJ.A.]

Counsel:

K.L. Bailey, for the appellant

J.S. Joy, for the respondent

Keywords: Criminal Law, Arson, Possession of Incendiary Material for the Purpose of Arson, Unrepresented Litigant, Right to Full Disclosure,  Right to a Fair Trial, Inadequate Assistance by the Trial Judge, Right to Make Full Answer and Defence, Canadian Charter of Rights and Freedoms, ss. 7 and 24(1), R v Dixon, [1998] 1 SCR 244, R v Taillefer, 2003 SCC 70, R v McGibbon (1988), 45 CCC (3d) 334 (Ont CA), Pintea v Johns, 2017 SCC 23, Moore v Apollo Health & Beauty Care, 2017 ONCA 383

R v. Aalami, 2017 ONCA 624

[Strathy C.J.O., Benotto and Miller JJ.A.]

Counsel:                  

G. Lafontaine and R. Golec, for the appellant

S. Porter, for the respondent

Keywords: Criminal Law, Possession of Child Pornography, Making Child Pornography Available, Credibility, Kineapple Principle, Canadian Charter of Rights and Freedoms, ss. 8, 11 and 24(2), R v W (D), [1991] 1 SCR 742, R v Sheppard, 2002 SCC 26, R v Morin, [1992] 1 SCR 771, R v Jordan, 2016 SCC 27, , R v Allen (1996), 92 OAC 345

R v. John, 2017 ONCA 622

[MacPherson, Blair and Watt JJ.A.]

Counsel:

B. Snell, for the appellant

M. Lai, for the responding party

Keywords: Criminal Law, Robbery, Use of an Imitation Firearm, Evidence, Hearsay, Trial Fairness, Sentencing, Pre-Disposition Custody, Canadian Charter of Rights and Freedoms, ss. 7 and 11(b), Truth in Sentencing Act, R v Hamilton, 2011 ONCA 399, R v Lyttle, 2004 SCC 5, R v Cuadra (1998), 125 CCC (3d) 289

R v. Kelly, 2017 ONCA 621

[Feldman, Gillese and Benotto JJ.A.]

Counsel:

J. Kaldas, for the appellant

J. Barrett, for the respondent

Keywords: Criminal Law, First Degree Murder, Mr. Big Operation, Confessions, Jury Instructions, R v Hart, 2014 SCC 52, R v Mack, 2014 SCC 58, R v McIntyre, [1994] 2 SCR 480, R v Johnston, 2016 BCCA 3, R v W(D), [1991] 1 SCR 742

R v. Spence, 2017 ONCA 619

[Juriansz, Pepall and Trotter JJ.A.]

Counsel:

C. Hicks, for the appellant

N. Thomas, for the respondent

Keywords: Criminal Law, First Degree Murder, Intent, Mens Rea, Post-Offence Conduct, Jury Instructions, Criminal Code, ss. 16, 229(a), 231(2) and 745(a), R v Mathisen, 2008 ONCA 747, More v The Queen, [1963] SCR 522, R v Nygaard, [1989]  2 SCR 1074

R v. Wu, 2017 ONCA 620

[Strathy C.J.O., Benotto and Miller JJ.A.]

Counsel:

E. Taché-Green for the appellant/respondent by way of cross-appeal

S. Marinier, for the respondent/appellant by way of cross-appeal

Keywords: Criminal Law, Possession of a Controlled Substance for the Purpose of Trafficking, Reasonableness, Inconsistent Verdicts, Parole Eligibility, Canadian Charter of Rights and Freedoms, s 8, R v Ling, 2012 ONSC 654, R v Villaroman, 2016 SCC 33, R v Uhrig, 2012 ONCA 470

R v. Suarez-Noa, 2017 ONCA 627

[Doherty, Rouleau and Pepall JJ.A.]

 Counsel:

J. Patton and P. G. Cowle, for the appellant

H. Pringle and C. Gill, for the respondent

Keywords: Criminal Law, Second Degree Murder, Manslaughter, Mens Rea, Defences, Provocation, Evidence, Expert Opinions, Admissibility, Criminal Code, ss. 232 and 676, R v Flegel (2005), 196 CCC (3d) 146 (Ont. C.A.), Wexler v The King, [1939] SCR 350, Savard and Lizotte v The King, [1946] SCR 20, R v  Cinous, 2002 SCC 29

The information contained in our summaries of the decisions is not intended to provide legal advice and does not necessarily cover every matter raised in a decision. For complete information or for specific advice, please read the decision or contact us.

ONTARIO COURT OF APPEAL SUMMARIES (JULY 17 – 21, 2017)

Good afternoon,

Following are the summaries for this week’s civil decisions of the Court of Appeal for Ontario.

In Rainy River (Town) v. Olsen, the mayor of the town was unsuccessful, both in the court below and in the Court of Appeal, in getting an injunction against the respondent preventing him from defaming and harassing the mayor and other court staff. No finding of defamation was made, and therefore no injunction order restraining defamation could be made.

In Duff v. James, a family law decision, the Court held that the application judge in this case had the authority to impose obligations on the OPP to enforce a child custody order where the father was a member of the local police force and an inherent conflict of interest arose if his colleagues on the local force were asked to enforce the order.

Other topics covered include costs in guardianship matters, vexatious litigants, and MVA.

Have a great weekend.

John Polyzogopoulos
Blaney McMurtry LLP
jpolyzogopoulos@blaney.com
Tel: 416 593 2953
http://www.blaney.com/lawyers/john-polyzogopoulos

Table of Contents

Civil Decisions

Rainy River (Town) v. Olsen, 2017 ONCA 605

Keywords: Torts, Defamation, Employment Law, Occupational Health and Safety, Occupational Health and Safety Act, R.S.O. 1990, c. O.1, Remedies, Injunctions

Duff v. James, 2017 ONCA 606

Keywords: Family Law, Custody and Access, Orders, Enforcement, Police, Children’s Law Reform Act, R.S.O. 1990, c. C. 12, ss. 12 & 36(2), Police Services Act, s. 9(2)

D’Ascenzo v. Nichols, 2017 ONCA 604

Keywords: Contracts, Damages, Restitution, Pre-judgment Interest, Post-judgment Interest, Courts of Justice Act, R.S.O. 1990, c. C.43, ss. 128 and 129

Ontario (Attorney General) v. Reyes, 2017 ONCA 613

Keywords: Civil Procedure, Vexatious Litigants, Stay of Order, Courts of Justice Act, R.S.O. 1990, c. C.43, Rules of Civil Procedure, Kallaba v. Bylykbashi (2006), 265 D.L.R. (4th) 320 (Ont. C.A.)

Jaffer v. Pardhan, 2017 ONCA 612

Keywords: Torts, Negligence, MVA, Statutory Liability, Owners, Underinsured Motorists, Highway Traffic Act, s. 192(2), Fresh Evidence

Childs v. Childs, 2017 ONCA 608

For Criminal Decisions, click here.

Civil Decisions

Rainy River (Town) v. Olsen, 2017 ONCA 605

[Sharpe, Lauwers and Roberts JJ.A.]

Counsel:

A.D. McKitrick, for the appellant

No one appearing for the respondent

Keywords: Torts, Defamation, Employment Law, Occupational Health and Safety, Occupational Health and Safety Act, R.S.O. 1990, c. O.1, Remedies, Injunctions

Facts:

The Town of Rainy River and its mayor, Deborah Ewald, brought an application to stop the respondent, Paul Olsen, from continuing to harass and defame the mayor, members of Town council, and staff. The application was brought under R. 14.05(3)(h) of the Rules of Civil Procedure. There were no facts in dispute since Mr. Olsen declined to participate and the only evidence before the application judge was provided by representatives of the Town. However, the application judge refused to grant any of the relief sought.

Issues:

(1) Did the application judge err in refusing to issue a declaration that Mr. Olsen’s conduct breached the Town’s “Violence Free in the Workplace Policy” and the “Harassment Policy” under the Occupational Health and Safety Act, R.S.O. 1990, c. O.1 (the “Act”), on the basis that the Town has a duty to protect its workers under the terms of the Act?

(2) Did the application judge err in refusing to issue a permanent injunction restraining Mr. Olsen from making “in any manner whatsoever directly or indirectly, any statements or comments about Deborah Ewald or any other town councillor, employee or agent that are defamatory and/or made with malice or ill-will”?

(3) Did the application judge err in not addressing the appellant’s order that sought to restrain Mr. Olsen from maintaining or purporting to maintain, without permission or authority from the Town, any Town property, including any municipal streets, sidewalks and road allowances?

Holding: Appeal allowed, in part.

Reasoning:

(1) No. The application judge held that neither the Act nor the Town’s policy under it had any application to Mr. Olsen, since the harassment occurred outside the workplace and Mr. Olsen was not a worker or co-worker as defined by the Act. The Court of Appeal saw no error in this determination.

(2) No. The application judge pointed out that a permanent injunction would have been appropriate if there had been a verdict of defamation or a final judgment in defamation: Astley v. Verdun, 2011 ONSC 3651 at para 21.

However, such injunctions are not at large, as the appellants sought in this case, but are invariably linked to a finding that defamation has occurred: Barrick Gold Corp. v. Lopehandia (2004), 71 O.R. (3d) 416 (C.A.), at para 78; Astley, at para 35; Ottawa-Carleton District School Board v. Scharf, [2007] O.J. No. 3030 (S.C.), at para 30, aff’d 2008 ONCA 154, leave to appeal ref’d, [2008] S.C.C.A. No. 285.

A broad ongoing injunction is an extraordinary remedy which should be used sparingly: St. Lewis v. Rancort, 2015 ONCA 513 at para 16, leave to appeal ref’d, [2015] S.C.C.A. No. 407, The appellants did not seek a declaration that Mr. Olsen had defamed the mayor or anyone else, and the application judge did not make such a finding. Therefore, the Court of Appeal saw no error in the application judge’s refusal to issue a permanent injunction regarding defamatory speech.

(3) Yes. The evidence justified this relief and the application judge erred in not addressing it directly.

Duff v. James, 2017 ONCA 606

[Sharpe, Lauwers and Miller JJ.A.]

Counsel:

V. Torrance, for the appellant/respondent, Waterloo Regional Police Service

C. Diana and L. Donnelly, for the appellant/respondent, Ontario Provincial Police

No one appearing for the respondents, Shirley Diana Duff and Mark Alexander James

S. Dewart and M. Thomarat, appearing as amicus curiae

Keywords: Family Law, Custody and Access, Orders, Enforcement, Police, Children’s Law Reform Act, R.S.O. 1990, c. C. 12, ss. 12 & 36(2), Police Services Act, s. 9(2)

Facts:

The order that is the subject of these appeals arose out of a high conflict custody dispute between a father and mother. The motion judge found that the police force that would ordinarily be called upon to enforce the order, the Waterloo Regional Police Service (“WRPS”), had an inherent conflict of interest and therefore was not able to assist because the father was a member of the WRPS.

In 2015, the mother brought a contempt motion following the father’s failure to deliver the child to her custody. The motion judge found that officers of the WRPS had interfered with the exchange of the child from the father to the mother. The motion judge’s order granted the following police assistance provision:

This Court orders, pursuant to Section 36 of the Children’s Law Reform Act, that the Ontario Provincial Police, having jurisdiction where the said child may be found, is hereby directed to locate, apprehend and deliver the child to the parent entitled to custody or access in accordance with this Order, which direction shall remain in effect until further order of this Court.

The parties respected the custody and access schedule and neither had needed to resort to the Ontario Provincial Police (“OPP”) for assistance. On April 28, 2016, the OPP brought a motion to vary the police assistance provision in the order, so that the OPP would no longer be the police service designated. It was supported in this by the WRPS.

The motion judge refused to vary the order because of the WRPS’ inherent conflict of interest. The motion judge also held that where the best interests of a child are at stake, and where there is a legislative gap, the court has parens patriae jurisdiction to craft a remedy. Accordingly, the motion judge ordered the OPP to provide the needed assistance. The OPP and WRPS each appealed.

The OPP argued that it is the Ontario Civilian Police Commission (OCPC), and not the Superior Court, that is assigned supervisory jurisdiction and can determine that a municipal police force has failed to provide adequate or effective policing and, in such circumstances, can request the OPP to assist, per s. 9(2) of the Police Services Act.

Issues:

(1) Did the motion judge have the authority to impose an obligation on the OPP to enforce the police assistance provision?

(2) Did the motion judge err in relying on his parens patriae jurisdiction as a possible basis for the order that he made?

(3)  Did the motion judge’s order extend the involvement of the OPP further than necessary?

Holding: Appeal dismissed.

Reasoning:

(1) Yes. The powers conferred on the OCPC by the Police Services Act do not contemplate the OCPC dealing with, or remedying, the kind of case-specific problem posed by this case.

The motion judge’s order was authorized by the plain language of s. 36(2) of the Children’s Law Reform Act:

Where a court is satisfied upon application that there are reasonable and probable grounds for believing,

(a) that any person is unlawfully withholding a child from a person entitled to custody of or access to the child;

the court by order may direct a police force, having jurisdiction in any area where it appears to the court that the child may be, to locate, apprehend and deliver the child to the person named in the order.

The OPP is a police force having “jurisdiction to maintain the peace and enforce the laws” in Waterloo Region: Foster v. ADT Security Services Canada Inc., 2007 ONCA 653 at para 3. Section 36(2) is not premised on there being a single police force with exclusive jurisdiction in any territory.

(2) Not decided. The power conferred by s. 36(2) is broad enough to permit a judge to order assistance from any police force, including the OPP that has jurisdiction in a given area. Accordingly, there is no legislative gap, and the Court of Appeal did not find it necessary to address the issue of parens patriae.

(3) Yes. By specifying that the OPP is the police force “having jurisdiction where the said child may be found”, the order extended the involvement of the OPP further than necessary. Should the child happen to be in another region, outside the territory of the WRPS, there is no reason why the OPP should be preferred over the municipal force in that region. Although the order expired and the appeal was moot, it would have been preferable for the order to have provided that the OPP would only be required to provide assistance if the child was to be found within the region policed by the WRPS.

D’Ascenzo v. Nichols, 2017 ONCA 604

[MacPherson, Cronk and Benotto JJ.A.]

Counsel:

M. Boire, for the appellant/respondent by way of cross-appeal

J. Laberge and M. Ranaivoson, for the respondents

Keywords: Contracts, Damages, Restitution, Pre-judgment Interest, Post-judgment Interest, Courts of Justice Act, R.S.O. 1990, c. C.43, ss. 128 and 129

Facts:

In 2006, the respondents sought to purchase from the appellant (a) the appellant’s shares in 1702620 Ontario Inc., (b) the Petting Zoo vacant land, and (c) the Lot 511 vacant land. The Share Purchase Agreement included the terms by which the appellant was to sell the Petting Zoo and Lot 511 to the respondents. However, the appellant did not take the required steps to have Lot 511 severed pursuant to the Planning Act, R.S.O. 1990, c. P.13. No mortgage was ever registered on title to either property. The share purchase transaction closed on November 24, 2006.

Since the closing, as of January 2013, the respondents made payments to the appellant towards the purchase of the Petting Zoo and Lot 511 totalling $168,727. The respondents did not make any further payments after January 2013. After that point, the respondents demanded clear title to the Petting Zoo because they alleged they had paid for it in full, and said they would pay the remaining $27,500, owing for Lot 511, when the appellant cleared up the title issues relating to the severance of that property.

The appellant refused to convey title to the Petting Zoo and informed the respondents that he was “foreclosing” on Lot 511. The respondents commenced an action and brought a motion for summary judgment, which was granted, in part. The motion judge ordered rescission and damages with respect to one of the properties (the Petting Zoo), and issued a certificate of pending litigation with respect to the other property (Lot 511), pending a trial of the issue of specific performance, which involved the issue of the granting of a severance of the two properties.

The appellant sought to overturn the motion judge’s decision on the basis that the respondents defaulted on their debt obligation and therefore forfeited their interest in both properties. In the alternative, the appellant sought to vary the judgment and alleged that the motion judge erred in determining the appropriate remedies for both properties.

The Court of Appeal dismissed the appeal in this case by reasons dated July 6, 2017 (https://blaneyscourtsummaries.com/2017/07/07/ontario-court-of-appeal-summaries-july-4-july-7-2017/#13). The respondents raised four discrete and relatively minor issues on cross-appeal.

Issues:

(1) Did the motion judge err by denying the return of any interest paid relating to the Petting Zoo based on a finding that the interest was paid to delay the closing?

(2) Did the motion judge err in calculating the principal owed to the respondent?

(3) Did the motion judge err in not granting prejudgment interest on damages awarded for the Petting Zoo?

(4) Did the motion judge err by not dealing with and awarding $1,955.03 representing the amount paid by the respondents for municipal property taxes on the Petting Zoo?

Holding: Appeal allowed with respect to issues (1), (3), and (4), and appeal dismissed with respect to issue (2).

Reasoning:

(1) Yes. The Court of Appeal found that the respondents were entitled to restitution of the interest paid. It was the appellant who committed the pivotal breach of the contract, and the interest was to be paid, whether the closing was delayed or not, because it was a component of the original purchase price.

(2) No. The Court of Appeal found no error in the motion judge’s calculation.

(3) Yes. The Court of Appeal found that the respondents were entitled to prejudgment interest by virtue of s. 128(1) of the Courts of Justice Act. The Court noted that the motion judge awarded prejudgment interest with respect to the Lot 511 issue, and stated that it was likely just an oversight that the judge did not make a similar order with regard to the Petting Zoo.

(4) Yes. Since the taxes were paid by the respondents with a view to an eventual closing of the sale of the property, the respondents are entitled to a return of the money, together with pre- and post-judgment interest, in light of the failure to close.

Ontario (Attorney General) v. Reyes, 2017 ONCA 613

[B.W. Miller J.A. (In Chambers)]

Counsel:

Althea Reyes, in person

D. Polla, for the respondent, Attorney General of Ontario

K. Arora, for the respondent, The Office of the Children’s Lawyer

Keywords: Civil Procedure, Vexatious Litigants, Stay of Order, Courts of Justice Act, R.S.O. 1990, c. C.43, Rules of Civil Procedure, Kallaba v. Bylykbashi (2006), 265 D.L.R. (4th) 320 (Ont. C.A.)

Facts:

The moving party, Reyes, was subject to a vexatious litigant order made by Perell J, the terms of which put constraints on her ability to commence or continue legal proceedings. Specifically, she cannot commence or continue any proceedings in Ontario without first obtaining leave from a judge of the Superior Court of Justice, pursuant to s. 140(3) of the Courts of Justice Act. The process for obtaining leave is expressly provided in rule 38.13 of the Rules of Civil Procedure, which provides that an application under s. 140(3) is to be heard in writing without the attendance of the parties, unless the Court orders otherwise.

She appealed the vexatious litigant order to the Court of Appeal by right. That appeal had not yet been heard at the time of this decision, and in the interim, she wished to obtain a stay of the order. She subsequently filed motion materials with the Court of Appeal seeking a stay of the order. The Court Registry advised her that although it would hold the materials in abeyance, she would be required to obtain leave from a judge of the Superior Court before the motion could be heard in the Court of Appeal.

Ms. Reyes failed to bring that application for leave under rule 38.13. She instead brought a motion in the ordinary course both for leave and for the stay itself. Lederer J. denied the motion, and concluded that it was an abuse of process for Reyes to have sought a stay from both the Superior Court of Justice and the Court of Appeal.

Issues:

(1) Did the motion judge err in dismissing Reyes’ motion for a stay of the vexatious litigant order?

Holding: Appeal dismissed.

Reasoning:

(1) No. The leave motion ought to have been brought in writing, pursuant to rule 38.13(2). The failure to follow rule 38.13 was more than a failure to comply with a formality, as it circumvented a process designed to protect other litigants by putting them to the time and expense of an oral hearing. Failure to observe the prescribed process is not an irregularity which ought to be cured by rule 2.01.

Decisively, s. 140(4) of the Courts of Justice Act provides that “no appeal lies from a refusal to grant relief to the applicant” from a refusal by a judge of the Superior Court of Justice to grant leave to institute or continue a proceeding in any Court. Accordingly, no appeal from Lederer J.’s decision was available.

Reyes also argued that notwithstanding s. 140(4), the Court of Appeal could nevertheless hear her motion for a stay under s. 106 of the Courts of Justice Act. The Court of Appeal described her rationale as follows: if leave is not required to appeal a vexatious litigant order – because of the risk of fundamental unfairness if the order was granted in error – then neither should leave be necessary to seek an interim stay of that order pending the appeal. The same risk of unfairness from an order made in error hovers over them both.

The Court of Appeal rejected this argument, holding that a vexatious litigant order is presumptively correct and strikes a balance between safeguards for the vexatious litigant and protection for other litigants. Although there is some risk of unfairness to the applicant should it later be determined that the order was made in error, the risk of unfairness is nevertheless temporarily contained to the period of time up until the decision of the appeal. The risk of unfairness is further limited by the opportunity to seek leave in the Superior Court to bring the motion for a stay.

Were it to be otherwise, and a motion for a stay was available as of right, a vexatious litigant would be able to command two additional oral hearings: one for the stay motion and another for an appeal if the stay motion were unsuccessful. This would put opposing parties to further expense, contrary to the purpose of s. 140.

Jaffer v. Pardhan, 2017 ONCA 612

[Sharpe, Lauwers and Roberts JJ.A.]

Counsel:

I. Furlong, for the appellants

B. Haynes and B. Lee, for the respondent

Keywords: Torts, Negligence, MVA, Statutory Liability, Owners, Underinsured Motorists, Highway Traffic Act, s. 192(2), Fresh Evidence

Facts:

The appellant appeals a summary judgment dismissing her claim against herself for statutory vicarious liability as the owner of the vehicle involved in an accident in which she suffered a personal injury. The appellant’s claim is based on the deemed statutory liability imposed by the Highway Traffic Act on the owner of the vehicle. The appellant was a passenger in the vehicle she owned that was being driven with her consent by her daughter at the time of the accident. The motion judge granted summary judgment dismissing the claim on the ground that the accident did not occur on a “highway” as defined in the Act and that accordingly s. 192(2) of the Act had no application. The appellant seeks to introduce fresh evidence indicating that the accident occurred at the Unionville GO Station parking lot and that, as the parking lot and the laneway are used by the general public, there is a triable issue as to whether the Act applies.

Issues:

(1) Did the judge err in dismissing the claim by way of summary judgment?

Holding: Appeal dismissed.

Reasoning:

(1) No. The court held that the motion to admit fresh evidence had to be dismissed. First, it was inconsistent with the position taken by the appellant in her statement of claim. Second, the evidence clearly could have been available at the time the motion for summary judgment was heard. Third, the appellant did not bring the proposed fresh evidence forward by following the prescribed procedure of bringing a motion to adduce fresh evidence but rather simply included the affidavits relied on in the Exhibit Book. Finally, the court found that given the involvement of the two fully insured defendants, the fact that the appellant attempted to sue herself, and the availability of underinsured coverage, it was difficult to see how the appellant would suffer any practical prejudice from having the claim dismissed.

Childs v. Childs, 2017 ONCA 608

[Gillese, Huscroft and Trotter JJ.A.]

Counsel:

P. Childs and C. Childs, in person for the appellants

M. Childs and A. Childs, in person for the respondents

Keywords: Wills and Estates, Guardianship, Costs

Facts:

This endorsement arose out of a dismissed review motion where the parties were invited to make written submission on costs. The facts underlying this case involved the issue of whether the appellant child of an incapable woman with dementia, Eileen Childs, should be awarded damages for providing care to her mother.

The respondents sought costs of approximately $50,000 on a full indemnity basis with all outstanding costs to be paid by BMO Trust Company as guardians of property for Eileen Childs, and Eileen Childs’ estate on her death. The appellants disagreed with the respondents on the basis that Eileen Childs benefited greatly from their care, and asked that costs be paid wholly by Eileen Childs’ estate on her death.

Issues:

(1) Should costs be wholly paid from Eileen Childs’ estate on her death?

Holding: Appeal dismissed.

Reasoning:

(1) No. There is no reason to depart from the normal practice of awarding costs on a partial indemnity basis to the successful party. The respondents are to be awarded $24,400 paid by BMO Trust Company as guardians of property for Eileen Childs, to be offset against any inheritance that the appellants are entitled to upon Eileen Childs’ death.

Criminal Decisions

R. v. Agresta, 2017 ONCA 603

[Hoy A.C.J.O, Simmons and Brown JJ.A.]

Counsel:

A. Ohler, for the appellant

A. Agresta, appearing in person

P. Fraser, for the respondent

Keywords: Criminal Law, Fresh Evidence, Criminal Code, s. 606

R. v. Boast, 2017 ONCA 602

[Hoy A.C.J.O., Simmons and Brown JJ.A.]

Counsel:

M. Dineen, for the appellant

C. Boast, appearing in person

J. Epstein, for the respondent

Keywords: Criminal Law, Intimidation, Criminal Code, s. 423(1)(b)

R. v. Gamble (Appeal Book Endorsement), 2017 ONCA 610

[Hoy A.C.J.O., Simmons and Brown JJ.A.]

Counsel:

E. Rondinelli, for the appellant

R. Gamble, appearing in person

M. Bernstein, for the respondent

Keywords: Criminal Law, Sentencing

R. v. Douglas, 2017 ONCA 609

[Hoy A.C.J.O., Simmons and Brown JJ.A.]

Counsel:

K. Douglas, acting in person

A. Ohler, appearing as duty counsel

T. Gilliam, for the Crown

Keywords: Criminal Law, Possession, Evidence, Witnesses

R. v. Husbands, 2017 ONCA 607

[LaForme, Watt and Trotter JJ.A.]

Counsel:

D. Derstine & S. DiGiuseppe, for the appellant

A. Alvaro, for the respondent

Keywords: Criminal Law, Jury Selection, Criminal Code, s. 640(2.1)

The information contained in our summaries of the decisions is not intended to provide legal advice and does not necessarily cover every matter raised in a decision. For complete information or for specific advice, please read the decision or contact us.

ONTARIO COURT OF APPEAL SUMMARIES (JULY 10 – JULY 14, 2017)

Good afternoon,

Following are the summaries of civil decisions released this week by the Court of Appeal for Ontario. It was a relatively light week, typical of the summer months.

The highlight was a Small Claims Court decision. In Riddell v. Apple Canada Inc., the Court confirmed that Deputy Judges of the Small Claims Court have jurisdiction to order one side to submit to the pre-trial inspection of property by the other side. The claim related to alleged burns suffered by the plaintiff as a result of an overheated iPhone. He had refused to allow Apple to inspect the phone before trial.

In A.M. v. Valoris Pour Enfants et Adultes de Prescott-Russell, a Crown wardship decision, the Court of Appeal overturned the Divisional Court and restored a motion judge’s decision to add a child’s foster mother as a party to the adoption proceeding, affirming that the best interests of the child are the paramount consideration and that other considerations, such as delay and legal interests, while relevant, are not, by themselves, determinative.

Other topics covered this week included a family shareholder/real property dispute, pension benefits, wrongful dismissal and a contractual interpretation case relating to what appears to have been a tax-driven transaction that did not yield the tax consequences that had been expected.

Have a nice weekend.

John Polyzogopoulos

Blaney McMurtry LLP

jpolyzogopoulos@blaney.com

Tel: 416 593 2953

http://www.blaney.com/lawyers/john-polyzogopoulos

 

Table of Contents

A.M. v. Valoris Pour Enfants et Adultes de Prescott-Russell, 2017 ONCA 601

Keywords: Family Law, Crown Wardship, Adoption, Standing, Addition of Parties, Child and Family Services Act, R.S.O. 1990, c. C.11, ss 39(1), (3), Family Law Rules, O. Reg. 114/99, r 7(4), (5)

1162740 Ontario Limited v. Pingue, 2017 ONCA 583

Keywords: Corporations, Shareholder Remedies,  Evidence, Experts, Rules of Civil Procedure, r. 53.08, Offers to Settle, Substantial Indemnity Costs

Riddell v. Apple Canada Inc., 2017 ONCA 590 

Keywords: Civil Procedure, Courts, Small Claims Court, Jurisdiction, Pre-Trial Discovery, Inspection of Property, Courts of Justice Act, s. 25, Rules of the Small Claims Court, O. Reg. 258/98, r. 1.03(2), 17.03(2), Rules of Civil Procedure, r. 32.01

Bell v. Ontario Power Generation Inc., 2017 ONCA 587

Keywords: Pension and Benefits Law, Survivor Pension Benefits, Conjugal Relationship, Pension Benefits Act, R.S.O. 1990, c. P.8

Brompton Corp. v. Tuckamore Holdings LP, 2017 ONCA 594

Keywords: Contracts, Interpretation, Representations and Warranties, Factual Matrix, Deference, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 SCR 633

Aboagye v. Atomic Energy of Canada, 2017 ONCA 598

Keywords: Employment Law, Wrongful Dismissal, Cause, Dishonesty, National Security, Summary Judgment

For Civil Endorsements, click here.

For Criminal and Ontario Review Board Decisions, click here.

 

Civil Decisions:

A.M. v. Valoris Pour Enfants et Adultes de Prescott-Russell, 2017 ONCA 601

[Hoy A.C.J.O, van Rensburg and Roberts JJ.A.]

Counsel:

J. Bergeron, for the appellant

A. Pare-Chouinard, for the respondents

Keywords: Family Law, Crown Wardship, Adoption, Standing, Addition of Parties, Child and Family Services Act, R.S.O. 1990, c. C.11, ss 39(1), (3), Family Law Rules, O. Reg. 114/99, r 7(4), (5)

Facts:

The child, A.M., was made a ward of Valoris pour enfants et adultes de Prescott-Russell (the “Society”) at the age of two months. In December 2015, when he was seven months old, he was placed with a foster-to-adopt mother (the “F-A mother”).

The Society filed a status review application in January of 2016 requesting the child be made a Crown ward with no access rights to the parents. The Society’s position was that if the child was made a Crown ward, it would support the F-A mother as the adoptive parent for the child. An uncontested trial of the Society’s application for Crown wardship was scheduled and adjourned pending the opportunity for the biological parents to move to set aside their noting in default. No such motion was brought.  A paternal aunt and her partner expressed an intention to adopt the child early in 2016. In June of 2016 the Society decided to support that plan instead. The paternal aunt and her partner filed a motion seeking to be added as parties and for a temporary order for care of the child. That motion was adjourned. The F-A mother brought a motion seeking to be added as a party to the child protection proceeding.

The motion judge considered the facts of the case and found that the F-A mother was in the best position to inform the Court as to what the specific needs are and what is in the best interest of the child. He ordered that the F-A mother be a party to the proceeding or, if a higher court disagreed with that determination, that the F-A mother have full rights to participate in this proceeding pursuant to s. 39(3) of the Child and Family Services Act, R.S.O. 1990, c. C.11 (“CFSA”). He found that s.39(1) of the CFSA provides who will be automatically be parties to a child protection proceeding, but does not limit parties to those listed. He also noted that s.39(3) of the CFSA provides a limited right of participation for non-parties, such as foster parents, to the proceeding, and found that this was not an indication that a foster parent should not be made a party.

On appeal, the Divisional Court found that the motion judge overlooked the existing presumptive rights of participation of the F-A mother under the CFSA and the fact that she could request permission from the court to have her participatory rights expanded. The Divisional Court noted that the motion judge did not consider rules 7(4) and 7(5) of the Family Law Rules, O. Reg. 114/99, which describe the parties who should be added in a child protection case and stated that the court’s discretion to add parties under r. 7(5) should be exercised with caution.

The Divisional Court held that in determining whether a foster parent should be added as a party, the court should consider the following criteria:

(1) Is adding the party necessary for a determination of the issues in the case?

(2) Would adding the party cause delays in the process?

(3) Does the individual have a legal interest in the child protection proceeding?

It concluded that the motion judge failed to consider all these criteria such that the Divisional Court was entitled to interfere with the motion judge’s exercise of discretion. Furthermore, it found that adding the F-A mother would add delay and that the F-A mother did not have a legal interest in the proceeding.

Issues:

(1) Did the Divisional Court err in overturning the motion judge’s decision to add the F-A mother as a party to the child protection proceeding?

Holding: Appeal allowed.

Reasoning:

(1) Yes. There was no palpable and overriding error, error in law, or unreasonable exercise in discretion to justify interfering with the motion judge’s decision. The Court of Appeal found that r. 7(4) and s. 39(3) of the CFSA preserve the court’s discretion to add a foster parent as a party to a child protection proceeding. The Divisional Court circumscribed the exercise of that discretion too narrowly because delay and legal interest are relevant, but not, by themselves, determinative. The overarching consideration is the child’s best interests. The Court of Appeal found that the following factors, cited in Children’s Aid Society of London and Middlesex v H.(S.), [2002] O.J. No. 4491 were relevant:

(i) Whether the addition of the party is in the best interest of the child;

(ii) Whether the addition of the party will delay or prolong the proceedings unduly;

(iii) Whether the addition of the party is necessary to determine the issues; and

(iv) Whether the proposed party is a person capable of putting forward a plan that is in the child’s best interests.

The Court of Appeal found that whether the person trying to be added also has a legal interest was also a relevant consideration based on Children’s Aid Society of Algoma v. V.C., 2001 ONCJ 83, and that not all of these considerations had to go in favour of the F-A mother for her to be added. The Court of Appeal also endorsed a list of additional considerations discussed in Catholic Children’s Aid Society of Toronto v S.(R.D.) (2008), 55 RFL (6th) 132.

The Court of Appeal found that adding the F-A mother would not lead to considerable delay and that the F-A mother did have a legal interest because any opportunity for her to the adopt the child could be foreclosed based on the determination of the matter.  The motion judge undertook a fact-specific and contextual analysis, and was therefore entitled to determine that the F-A mother’s participation as a party was both necessary and in the child’s best interests based on the facts of this case.

1162740 Ontario Limited v. Pingue, 2017 ONCA 583

[Hoy A.C.J.O., van Rensburg and Roberts JJ.A.]

Counsel:

R. Wozniak, E. Sherkin, and K. Sherkin, for the appellants

H.S. Nesathurai and G. M. Perinot, for the respondents

Keywords: Corporations, Shareholder Remedies, Evidence, Experts, Rules of Civil Procedure, r. 53.08, Offers to Settle, Substantial Indemnity Costs

Facts:

These proceedings arose out of a failed business venture among two brothers – Venanzio Pingue (“Venanzio”) and the respondent, Sabatino Pingue Jr. (“Sabatino”), and their cousin, Joseph Pingue (“Joseph”), involving the purchase of an apartment building at 315 Glendale Avenue in St. Catharines. The appellants appealed from the judgment of the trial judge granting a constructive trust over their properties, declaring that the appellant, Venanzio, was not a shareholder of the respondent, 1162740 Ontario Limited (“116”), and removing him as an officer and director of 116 in light of her finding that he breached his fiduciary duties.

Although it was ostensibly set up as a bare trustee, the parties treated 116 as the absolute owner of 315 Glendale Avenue. Joseph advanced the monies to purchase 315 Glendale Avenue. In consideration of his providing these funds, Sabatino and Venanzio transferred their respective shares in 116 to Joseph. Venanzio and Sabatino had a period of five years to reacquire their shares by repaying Joseph their respective portions of the monies. Venanzio never paid Joseph for his shares. The relationship foundered when Joseph and Sabatino discovered that Venanzio had misappropriated $592,671.43 from 116.

The trial judge granted judgment for the respondents and imposed a constructive trust over three properties owned by the appellants to secure repayment of the misappropriated funds. She declared that Venanzio was not a shareholder of 116 because he had not paid for his shares, and removed him as an officer and director of 116 because of his breach of his fiduciary duties to 116.

The appellants sought to admit as fresh evidence, a copy of the parcel register that shows that 315 Glendale was sold by 116 on January 25, 2017, for $7,200,000. Additionally, the appellants sought leave to appeal the trial judge’s order as to costs.

Issues:

(1) Did the trial judge err in her interpretation of the parties’ agreement?

(2) Did the trial judge err in refusing to admit the appellants’ expert report?

(3) Should the appellants’ fresh evidence be admitted?

(4) Should the appellants’ leave to appeal the costs order be granted?

Holding: Appeal dismissed.

Reasoning:

(1) No. In their amended statement of claim, their evidence and their written submissions at trial, the respondents clearly maintained that the parties had never treated 116 as a bare trustee, but always as absolute owner of 315 Glendale Avenue, and that Venanzio had transferred his shares to Joseph but never paid for them in order to be entitled to the return of the shares.

The trial judge interpreted the parties’ written agreements and found them to be confusing and incomplete. This was a finding that was open to her on the record. As she was entitled to do, the trial judge accepted the respondents’ evidence as to the parties’ agreement concerning their relationship and the structure of their business venture. The Court of Appeal saw no basis to interfere with her conclusions.

(2) No. Granting of leave under r. 53.08 of the Rules of Civil Procedure to file expert reports is mandatory unless the court determines that granting leave will cause prejudice to the other party or undue delay in the conduct of the trial: Pavao v. Pinarreta, [1995] O.J. No. 1197, 40 C.P.C. (3d) 84 (C.A.), at para. 11.

The trial judge carefully and thoroughly considered and balanced all relevant factors. She determined, correctly, that the admission of the expert’s report at the end of the already lengthy second trial, following the conclusion of all of the evidence, would result in non-compensable prejudice to the respondents and undue delay.

(3) No. This evidence was not necessary or relevant to any issue on this appeal.

(4) No. An appellate court is not entitled to interfere with a trial judge’s discretionary assessment of costs absent error of law or overriding and palpable error. The trial judge awarded substantial indemnity costs because she found that the judgment obtained by the respondents was more favourable than their three offers to settle. She further found that Venanzio had misappropriated thousands of dollars, breached his fiduciary obligations, and attempted to deceive the court. These findings justified the award at a substantial indemnity rate.

Accordingly, the appeal from the judgment, the motion to admit fresh evidence, and the motion for leave to appeal the costs order were dismissed.

Riddell v. Apple Canada Inc., 2017 ONCA 590

[MacPherson, Cronk and Benotto JJ.A.]

Counsel:

M. Riddell, in person

M.J. Jilesen and L.D. Hogg, for the respondent

Keywords: Civil Procedure, Courts, Small Claims Court, Jurisdiction, Pre-Trial Discovery, Inspection of Property, Courts of Justice Act, s. 25, Rules of the Small Claims Court, O. Reg. 258/98, r. 1.03(2), 17.03(2), Rules of Civil Procedure, r. 32.01

Facts:

In this products liability case brought in Small Claims Court, the appellant sought damages for what he alleged were personal injuries caused by the negligent manufacture of an iPhone by the respondent.  He claimed that the iPhone overheated and caused severe burns to his right arm.  He declared his intention to lead expert evidence at trial regarding the iPhone and the overheating event in order to establish his case. Yet, he refused, absent a court order, to permit an independent third party expert to inspect the iPhone prior to trial, to assist the trial judge in determining the central matter in dispute between the parties. The Deputy Judge ordered pre-trial inspection of the iPhone.

Issues:

(1) Do Deputy Judges of the Small Claims Court have jurisdiction to order the pre-trial inspection of property in a proper case?

(2) If such jurisdiction exists, was that jurisdiction properly exercised in the circumstances of this case?

Holding: Appeal dismissed.

Reasoning:

(1) Yes. Where trial fairness and the interests of justice, including the expeditious and least expensive determination of a case on the merits, so require, Deputy Court Judges of the Small Claims Court have jurisdiction under r. 1.03(2) of the Rules of the Small Claims Court, O. Reg. 258/98 (Small Claims Court Rules) to order the pre-trial inspection of property by reference to r. 32.01 of the regular Rules of Civil Procedure, R.R.O. 1990, Reg. 194.

The Small Claims Court Rules provide, under r. 17.03, for the inspection of property by a trial judge of the Small Claims Court, in certain circumstances. They do not adequately address the pre-trial inspection of property at the instance of a litigant. However, the failure to provide for such pre-trial inspection rights may be viewed as a deficiency in the scope and operation of r. 17.03.  In an exceptional case, therefore, resort may be had to r. 1.03(2) to cure this deficiency.

(2) Yes. The Court of Appeal did not accept the appellant’s submission that the recognition of the authority of Deputy Court Judges of the Small Claims Court to order the pre-trial inspection of property in exceptional circumstances undermines the mandate of the Small Claims Court to hear and determine cases in a summary way. To the contrary, it would assist Deputy Judges of the Small Claims Court to fulfil this important function in accordance with s. 25 of the Courts of Justice Act, R.S.O. 1990, c. 43.  In this regard, the Court of Appeal endorsed the comments of Deputy Judge S.M. McGill of the Small Claims Court in National Service Dog Training Centre Inc. v. Hall, [2013] O.J. No. 3216, at paras. 30-31:

A question about the condition of the property cannot be determined on the merits if only one side is allowed to collect relevant evidence.  A party will not perceive the justice system as fair if it is denied the basic opportunity afforded to the other party.  The playing field must be level or the administration of justice will fall into disrepute. 

Trial fairness, the interests of justice and the proper exercise of the trial judge’s functions under r. 17.03 of the Rules all compelled pre-trial inspection of the iPhone.

Accordingly, the appeal was dismissed.

Bell v. Ontario Power Generation Inc., 2017 ONCA 587

[MacPherson, Cronk and Benotto JJ.A.]

Counsel:

K. Armagon, for the appellant

F. Cesario and S. Kalinowski, for the respondent

Keywords: Pension and Benefits Law, Survivor Pension Benefits, Conjugal Relationship, Pension Benefits Act, R.S.O. 1990, c. P.8

Facts:

Shestowsky retired in February 2003 from the respondent, Ontario Power Generation, and received a pension until his death in May 2011. The pension was calculated in accordance with his representation that he did not have an eligible spouse.

After Shestowsky’s death, the appellant, Bell, claimed an entitlement to survivor pension benefits on the basis that she was a “spouse” pursuant to the Pension Benefits Act, R.S.O. 1990, c. P.8, (the “Act”) s. 1(1), which defines “spouse” as a person who, at the date of retirement, has been “living together” with the employee “in a conjugal relationship” for at least three years.

The trial judge dismissed the Bell’s claim having concluded that she was not living together with Shestowsky for three years before his retirement, and Bell appealed on numerous grounds.

First, Bell argued that trial judge erred by disbelieving the uncontradicted evidence that a flood had destroyed cards and photos that supported her claim and by finding her evidence and that of her daughter and friends unreliable.

Second, Bell argued that the trial judge misapplied the law with respect to the nature of a conjugal relationship. She said he erred in: (1) relying on a cohabitation agreement signed by the parties in 2002; (2) focusing on the subjective intent of Shestowsky; and (3) relying on Shestowsky’s pension election form. Bell argued that, by doing so, the trial judge misapplied the law set out in M. v. H., [1999] 2 S.C.R. 3, which held that the elements to consider as generally accepted characteristics of a conjugal relationship may be present to varying degrees and are not all necessary.

Issues:

(1) Did the trial judge err in disbelieving the uncontradicted evidence that a flood had destroyed cards and photos supporting Bell’s claim and finding that her evidence and that of her friends unreliable?

(2) Did the trail judge misapply the law with respect to the nature of a conjugal relationship?

Holding: Appeal dismissed.

Reasoning:

(1) No. The Court of Appeal found that Bell did not identify any error of fact or misapprehension of the evidence, stating that the issues raised by Bell challenge findings of fact that were amply supported by the evidence. As such, the Court stated that those findings attracted deference.

(2) No. It was open to the trial judge to rely on the evidence to conclude that a conjugal relationship did not exist. The trial judge’s reasons, read as a whole, disclosed a consideration of multiple factors which, taken together, led him to conclude that Bell and Shestowsky were not living together in a conjugal relationship for the three years before the deceased’s retirement. The trial judge used the non-exhaustive criteria set out in Molodowich v. Penttinen (1980), 17 R.F.L. (2d) 376 (Ont. Dist. Ct.), as a guideline, and, consistent with the jurisprudence, relied on objective, contemporaneous evidence. The evidence he relied on, including the cohabitation agreement signed by the parties, the respondent’s letter to Shestowsky noting that his pension record showed he had no eligible spouse, the pension election form signed by Shestowsky confirming he had no spouse and subsequent confirmation letter from the respondent, and the income tax returns filed by the appellant and Shestowsky, fully supported his conclusion that Bell was not an eligible spouse for the purpose of the Act or the pension plan administered by the respondent.

Brompton Corp. v. Tuckamore Holdings LP, 2017 ONCA 594

[MacPherson, Cronk and Benotto JJ.A.]

Counsel:

J. Teskey and K. Spence, for the appellants

C.P. Naudie, A. Nanji and L. Bruschetta, for the respondent

Keywords: Contracts, Interpretation, Representations and Warranties, Factual Matrix, Deference, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 SCR 633

Facts:

In 2008, Tuckamore and Brompton entered into an agreement whereby Brompton purchased Tuckamore’s business in exchange for the transfer of securities held by Brompton. As a term of the agreement, Brompton made a written representation and warranty regarding tax pools in favour of Tuckamore. This was contained in section 5.1(1) of the agreement, which read:

The Purchaser represents and warrants as follows to the Vendor and acknowledges and confirms that the Vendor is relying on such representation and warranties in connection with the sale by the Vendor of the Purchased Securities:

(l) Taxes. Immediately prior to Closing and after giving effect to the transactions contemplated by this Agreement, the Purchaser will have tax pools as described in the purchaser Disclosure Letter.

As a result of the transaction, Tuckamore became a minority shareholder of Brompton. In 2010, the parties reached a second agreement to sell Tuckamore’s minority interest back to Brompton. As a term of that agreement, Tuckamore agreed to indemnify Brompton for its proportionate share of any tax liabilities, including interest or penalties, assessed against Brompton under the Income Tax Act in respect of the period when Tuckamore was a Brompton shareholder (the “Tuckamore Indemnity”).

After the closing of this latter transaction and after the date of the Tuckamore Indemnity, the CRA disallowed Brompton’s attempted use of the tax pools to reduce its taxable revenues during the 2009-2013 taxation years. In 2015, the CRA assessed Brompton for approximately $11.8 million in additional taxes, interest and penalties. Brompton challenged that assessment in the courts, which challenge is still pending at the time of this appeal.

Following the CRA assessment, Brompton invoked the Tuckamore Indemnity to claim that Tuckamore was obliged to indemnify Brompton for its proportionate share of the assessed taxes, interest and penalties and the costs incurred by Brompton in challenging the CRA assessment. Tuckamore refused, arguing that s. 5.1(l) of the Agreement was a representation and warranty that the tax pools would be available for post-closing tax utilization. Since the CRA disallowed the use of tax pools, Brompton had breached s. 5.1(1) and could not rely on the Tuckamore Indemnity.

At issue, therefore, was the interpretation of s.5(1) – specifically, whether it constituted a representation and warranty as to the future tax utilization of the tax pools, or whether it was directed solely to the accurate identification of the tax pools in existence up to the date of closing of the first purchase transaction contemplated under the agreement.

The motion judge held that s. 5.1(1) did not give Tuckamore a representation and warranty that the tax pools would not be subject to a future tax assessment by the CRA, because it said nothing about the future use of the tax pools or how the CRA would assess them in future. The motion judge concluded that the representation and warranty was only as to the existence, amount and expiry dates of the tax pools and did not guarantee their availability for future use without the risk of a CRA assessment. Furthermore, the motion judge found that the plain language of s.5(1) suggested that Tuckamore was to be protected from the risk of misstatement of the tax pools, and not from the risk of a failed future utilization of them.

Issues:

(1) Did the trial judge err in his interpretation of the representation and warranty in s. 5.1(1) of the agreement with respect to the tax pools?

Holding: Appeal dismissed.

Reasoning:

(1) No. Given that matters of contractual interpretation are generally questions of mixed fact and law, they normally attract a deferential standard in which an appellant must identify either a palpable and overriding error or an extricable error of law. Tuckamore failed to identify either.

The motion judge correctly used the interpretive principles found in Sattva Capital Corp. v. Creston Moly Corp to interpret the words in the contract purposively, with the intent of the parties and the full factual matrix in mind. For instance, since the agreement was negotiated by two sophisticated parties, the motion judge rightly considered the commercial context in which the agreement was concluded and the surrounding circumstances that were known or ought to have been known to the parties at the time of the contract formation. In addition, the motion judge correctly gave effect to the plain language of s. 5.1(1) when determining that the purpose of the section was to protect from the risk of misstatement of the tax pools, not from the risk of a failed future utilization of them.

Aboagye v. Atomic Energy of Canada, 2017 ONCA 598

[MacPherson, Cronk and Benotto JJ.A.]

Counsel:

F. Aboagye, in person

F. Cesario, for the respondent

Keywords: Employment Law, Wrongful Dismissal, Cause, Dishonesty, National Security, Summary Judgment

Facts:

As part of his hiring by Atomic Energy Canada, the appellant was required to obtain security clearances. It was not in dispute on this appeal that he was not truthful when he completed a “Security Questionnaire for Site Access Clearance”. The form asked for an employment history and warned: “There should be no gaps…”. At the time, the appellant was employed at Ivaco Rolling Mills. He did not disclose this, but indicated by email that he was unemployed.

The appellant began working for the respondent on May 15, 2012. The respondent received complaints about his harassment of other employees. He was put on investigatory leave five months later in October 2012. During an interview as part of the investigation, it was revealed that he had lied about his whereabouts when the respondent was trying to reach him to extend an offer of employment. At the time, he said he was in Africa attending his father’s funeral. The appellant was terminated in December 2012.

The appellant’s wrongful dismissal claim was dismissed on a motion for summary judgment. He appealed.

Issues:

(1) Did the motion judge err in holding that the appellant was terminated for cause?

Holding: Appeal dismissed.

Reasoning:

(1) No. The motion judge’s reasons were detailed, thorough and properly set out the legal principles with respect to termination for cause. The court agreed that the breach of honesty in this case went to the core of the employment relationship.

The respondent’s employees had access to nuclear facilities and information vital to the security of the country. The security clearances that employees were required to pass were designed to protect national security. The court therefore found that on this basis alone, there were clear grounds for dismissal and there was no genuine issue requiring a trial.

Short Civil Endorsements

AIG Insurance Company of Canada v. Priyance Hospitality Inc., 2017 ONCA 595

[MacPherson, Cronk and Benotto JJ.A.]

Counsel:

R. Lester, for the appellant

D.S. Ward and E. Craddock, for the respondent

Key Words: Mistake of Fact, Consideration, Unjust Enrichment, Equitable Subrogation, Constructive Trust, Fraud

 

Criminal Decisions

R. v. Morrison, 2017 ONCA 582

[Watt, van Rensburg and Pardu JJ.A.]

Counsel:

M. Halfyard, B. Vandebeek and S. Caramanna, for the appellant

A. Baiasu, for the respondent

Key Words: Child Luring by Means of a Computer, Criminal Code s. 172.1, Constitutional Validity, Canadian Charter of Rights and Freedoms ss. 11(d) and 7, Mandatory Minimums

R. v. Ismail (Publication Ban), 2017 ONCA 597

[Weiler, Hourigan and Pardu JJ.A.]

Counsel:

E. Chozik, for the appellant

M. Fawcett, for the respondent

Key Words: Arson, Sentencing, Proportional Sentencing, Collateral Immigration Consequences

R. v. Dunkley, 2017 ONCA 600

[Weiler, Hourigan and Pardu JJ.A.]

Counsel:

C. Martell, for the appellant

C. Walsh, for the respondent

Key Words: Possession for the Purpose of Trafficking, Admissibility, Reasonable and Probable Grounds, Charter ss. 8 and 24(2), R. v. Debot, [1989] 2 S.C.R. 1140

R. v. Fountain, 2017 ONCA 596

[Weiler, Hourigan and Pardu JJ.A.]

Counsel:

D. Doucette, for the appellant

R. Young, for the respondent

Key Words: Armed Robbery, Forcible Confinement, Breaking and Entering a Dwelling House to Commit an Indictable Offence Therein, Right to Counsel, Prosper Warning, Right to Counsel, Charter s. 10(b), R. v. Prosper, [1994] 3 S.C.R. 236

R. v. Black, 2017 ONCA 599

[Weiler, Hourigan and Pardu JJ.A.]

Counsel:

M. Martin, for the appellant

S. Egan, for the respondent

Key Words: W.(D.) Analysis, Reasonable Doubt Standard, Burden of Proof, R. v. W.(D.), [1991] 1 S.C.R. 742, Sufficiency of Reasons for Judgment

The information contained in our summaries of the decisions is not intended to provide legal advice and does not necessarily cover every matter raised in a decision. For complete information or for specific advice, please read the decision or contact us.

ONTARIO COURT OF APPEAL SUMMARIES – JULY 4 – JULY 7, 2017

Good evening,

Following are the summaries for this week’s civil decisions of the Court of Appeal for Ontario. Claims against lawyers were the theme of the week.

In Trillium Motor World Ltd. v. Cassels Brock & Blackwell LLP class action case, the Ontario Court of Appeal dismissed Cassels Brock’s appeal from the liability finding against the firm for breach of fiduciary duty, but allowed, in part, the firm’s appeal on damages and remitted the matter back to the trial judge for a recalculation of the loss of chance damages suffered by the terminated GM dealers.

In the companion decision in Trillium Motor World Ltd. v. General Motors of Canada Limited, the Court of Appeal upheld the trial judge’s judgment dismissing the action against General Motors of Canada (“GMCL”). The Court confirmed that GMCL had not contravened the dealers’ rights under the Arthur Wishart Act (Franchise Disclosure), 2000 (the “AWA”).

In Goldentuler Estate v. Crosbie, the estate of a deceased lawyer was granted almost $550,000 in damages, plus $80,000 in punitive damages, against lawyers who had left the firm and improperly taken files with them. The trial and the appeal were both unopposed, as the defendant lawyers’ defence had been struck.

In John v. Ballingall, the court confirmed that an online version of a newspaper article is covered under the Libel and Slander Act, meaning that a plaintiff must give notice under that Act within six weeks of learning of the publication and must commence suit within three months, otherwise the cause of action for libel is lost.

Other topics covered this week included assessment of lawyers’ accounts, breach of contract, breach of trust, real property, commercial leases, crown wardship, employment law, non-share capital corporations, labour law, and SABs.

Have a nice weekend.

John Polyzogopoulos

Blaney McMurtry LLP

jpolyzogopoulos@blaney.com

Tel: 416 593 2953

http://www.blaney.com/lawyers/john-polyzogopoulos

Table of Contents

Civil Decisions

Trillium Motor World Ltd. v. Cassels Brock & Blackwell LLP, 2017 ONCA 544

Keywords: Contracts, Solicitor and Client, Torts, Professional Negligence, Fiduciary Duties, Duty to Avoid Conflicts of Interest, Duty of Loyalty, ,  Damages, Loss of Chance, Class Proceedings, Class Proceedings Act, section 24, Aggregate Damages

Trillium Motor World Ltd. v. General Motors of Canada Limited, 2017 ONCA 545

Keywords: Franchise Law, Arthur Wishart Act (Franchise Disclosure), 2000, section 11, 1518628 Ontario Inc. v. Tutor Time Learning Centres, LLC, 2006 CanLII 25276 (S.C.), Contracts, Enforcability, Public Policy, Class Proceedings, Class Proceedings Act, section 31(2), Costs  

Abou-Mansour v. Abou-Mansour, 2017 ONCA 572

Keywords: Family Law, Civil Procedure, Adjournments, Evidence, Cross-Examination

Morriseau v. Sun Life Assurance Company of Canada, 2017 ONCA 567

Keywords: Labour Law, Collective Agreements, Mandatory Arbitration, Insurance Law, Long-Term Disability Benefits, Jurisdiction, Rules of Civil Procedure, Rule 21.01(3)(a)

Aviva Insurance Co. of Canada v. McKeown, 2017 ONCA 563

Keywords: Insurance Law, Insurance Act, Ontario Regulation 34/10, Statutory Accident Benefits Schedule s. 33(4) 3 (“SABS”), Examinations Under Oath, Automobile Insurance Rate Stability Act, Automobile Insurance Rate Stabilization Act, Financial Services Commission of Ontario Act, Statutory Interpretation

Ares Law Professional Corporation v. Rock, 2017 ONCA 569

Keywords: Contracts, Settlements, Solicitor and Client, Assessment of Accounts, Solicitors Act, s. 3, Cohen v Kealey & Blaney (1985), 10 OAC 344

Angus v. Port Hope (Municipality), 2017 ONCA 566

Keywords: Contracts, Interpretation, Sattva Capital Corp. v. Creston Molly Corp., 2014 SCC 53, Heritage Capital Corp. v. Equitable Trust Co., 2016 SCC 19, Trusts, Three Certainties, Certainty of Intention, Charitable and Non-Charitable Purpose Trusts, Perpetuities Act, Schmidt v. Air Products Canada Ltd., [1994] 2 S.C.R. 611

Canadian Northern Shield Insurance Company v. 2421593 Canada Inc., 2017 ONCA 570

Keywords: Contracts, Interpretation, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633, Inducing Breach of Contract, Summary Judgment

K.F. v. Family and Children’s Services of the Waterloo Region, 2017 ONCA 573

Keywords: Family Law, Access, Child and Family Services Act, R.S.O. 1990, c. C.11, s. 69(6), Fresh Evidence, Catholic Children’s Aid Society of Metropolitan Toronto v. C. M., [1994] 2 S.C.R 165

Polish Alliance of Association of Toronto Limited v. The Polish Alliance of Canada, 2017 ONCA 574

Keywords: Corporations, Non-Share Capital Corporations, Corporations Act, R.S.O. 1990, c. C38, Unincorporated Voluntary Associations, Variation of Trusts Act, R.S.O. 1990, c. V. 1

Couper v. Nu-Life Corp., 2017 ONCA 571

Keywords: Employment Law, Contracts of Employment, Damages

John v. Ballingall, 2017 ONCA 579

Keywords: Torts, Defamation, Libel, Limitation Periods, Libel and Slander Act, ss. 5(1) and 6, Striking Pleadings, No Reasonable Cause of Action, Rules of Civil Procedures, r. 21

D’Ascenzo v. Nichols, 2017 ONCA 578

Keywords: Real Property, Contracts, Agreements of Purchase and Sale of Land, Repudiation, Remedies for Breach, Specific Performance, Rescission

Goldentuler Estate v. Crosbie, 2017 ONCA 591

Keywords: Contracts, Lawyers, Breach of Fiduciary Duty, Damages, Punitive Damages

L’Ouvrier Inc. v. Leung, 2017 ONCA 589

Keywords: Contracts, Real Property, Commercial Leases, Options to Renew, Civil Procedure, Summary Judgment, Adjournments

Gustafson v. Johnson, 2017 ONCA 581

Keywords:Corporations, Winding Up, Civil Procedure, Appeals, Jurisdiction, Ontario Business Corporations Act, section 255

For Civil Endorsements, click here.

For Criminal and Ontario Review Board Decisions, click here.

Civil Decisions

Trillium Motor World Ltd. v. Cassels Brock & Blackwell LLP, 2017 ONCA 544

[Cron, can Rensburg and Pardu JJ.A.]

Counsel:

P.H. Griffin, R. Jones and D. Glatt, for the appellant

B. Finlay, M. Vermette, M. Statham, D. Sterns, A. Dick and A. Seretis, for the respondent

Keywords: Contracts, Solictor and Client, Torts, Professional Negligence, Fiduciary Duties, Duty to Avoid Conflicts of Interest, Duty of Loyalty, ,  Damages, Loss of Chance, Class Proceedings, Class Proceedings Act, section 24, Aggregate Damages

Facts:

General Motors Corporation in the United States (“GM”) and its Canadian subsidiary, General Motors of Canada Limited (“GMCL”), were among the companies affected by the 2008 global financial crisis. Both companies were on the brink of bankruptcy. Their only hope was financial bailouts from the American and Canadian governments. However, the governments made the bailouts conditional on acceptable restructuring plans. In GMCL’s case, this meant cutting ties with hundreds of its dealerships across Canada.

In late 2008 GMCL had a car dealership network in Canada consisting of 705 franchised dealers, 51 of which were Saturn dealers. One of the ways in which GMCL communicated with its dealers was through the Canadian Automobile Dealers Association (“CADA”). CADA was a long-time Cassel’s client and retained Cassels during the relevant time period.

By the end of 2008, both GM and GMCL were insolvent or close to insolvency. GMCL made many efforts to deal with its potential insolvency. The first was that it proposed a reduction of its dealer network in a revised bailout proposal submitted to the Ontario and federal governments (the “Canadian Governments”).  The second was that it informed the Saturn dealers that it would discontinue the Saturn brand at the end of 2011. The third was that it hired financial advisors to begin preparations for a filing under the Companies’ Creditors Arrangement Act (“CCAA”). A CCAA filing would have had serious financial consequences for GMCL, as well as others associated with or dependent on it. The dealers were particularly vulnerable because they would rank as unsecured creditors with little, if any, prospect for recovery in the bankruptcy or restructuring.

By the end of April 2009, Cassels had three existing retainers involving GMCL and GM and one proposed retainer. The first retainer, as mentioned earlier, was the long-standing CADA retainer. The second retainer came in March 2009, when Saturn retained Cassels to provide legal advice about GMCL’s potential termination of their dealerships. The third retainer came shortly thereafter, when Cassels also accepted a retainer to represent Canada in a potential commercial financing transaction to support GMCL and Chrysler Canada. The proposed retainer was in April 2009, when GMCL requested that Cassels represent the GMCL dealers in respect of a potential CCAA filing by GMCL.

A group of Cassels lawyers, including the firm’s managing partner, met to discuss any potential conflicts of interest prior to accepting the fourth retainer. They ultimately decided that accepting the GMCL retainer would not create a conflict of interest with the firm’s Canada retainer, but agreed that an ethical wall should be erected within the firm and that each client should be informed about the firm’s retainer by the other. As such, Cassels accepted the proposed GMCL retainer.

Six days after Cassels accepted the GMCL retainer, GMCL officially announced that it would be discontinuing its Pontiac brand of cars. This represented 26 percent of GMCL’s sales in Canada. GMCL also released a revised restructuring plan that would reduce its dealer network from 705 to between 395 to 425 dealers by the end of 2010.

GMCL also prepared a plan for winding down some of its dealerships, including a process for identifying dealers who would receive a Wind-Down Agreement (“WDA”). The WDA proposal was intended to terminate the dealers’ business relationships and agreements with GMCL and eliminate GMCL’s estimated exposure to dealer claims resulting from the restructuring, while providing the dealers with what GMCL considered to be fair treatment in the circumstances.

CADA subsequently helped organize a formation of GMCL dealers into a national group, whose interests would be well-represented if GMCL were to file for bankruptcy protection. Approximately 400 GMCL dealers agreed to participate in this group. It is important to note that Cassels represented CADA and, in turn, this group.

Once the national GMCL dealer group was formed, they held a conference, where Cassels lawyers discussed, among other things: i) whether GM could unilaterally cancel contracts under the CCAA; ii) whether and how GM could sell off assets; and iii) the likelihood of a GM protective bankruptcy filing in the United states and a CCAA filing by GMCL.

GMCL delivered WDAs to 240 dealers approximately two weeks after the national dealer conference. The WDAs’ conditions were not uniform, and dealers were given six days to accept the offers. 202 of the 240 dealers accepted GMCL’s offers.

Cassels did not undertake any negotiations regarding the WDAs, or alternatives to them, with GMCL on behalf of the dealers. Further, with the exception of the Saturn dealers, Cassels did not engage in any discussions with GMCL, or with any dealers, about the possibility of attempting to negotiate improved offers from GMCL or the possibility of seeking an extension of time for the dealers’ consideration of the WDAs.

Trillium Motor World Ltd. (“Trillium”), a GMCL dealer in Toronto, commenced a class action proceeding on behalf of all dealers who had signed WDAs. There were 181 class members. Trillium claimed that Cassels breached its contractual and fiduciary duties to the dealers, including its duty of loyalty, by failing to disclose the existence of the Canada retainer, among other things. Trillium asserted that the dealers’ interests were adverse to Canada’s from the very start: the dealers wanted to get the most money possible from GMCL for their dealerships, and were willing to act as a spoiler in the run-up to a CCAA filing to get the best deal they could. In contrast, as the bailout party, Canada wanted GMCL to avoid a CCAA filing and to pay as little as possible to the dealers under the WDAs.

Cassels denied that it had an existing retainer with the GMCL dealers in the first place; it argued that it had a “contingent” retainer that would only crystallize in the event of a CCAA filing – an event that never occurred. It also maintained that there was no actual conflict between the dealers and Canada; the conflict was only a “potential” one that could be prudently managed if and when it materialized.

The trial judge allowed Trillium’s claim. He found that there was a retainer between Cassels and the dealers, and that the Canada retainer gave rise to a bright line conflict or a substantial risk of conflict with the dealers’ retainer. He found that, at a minimum, Cassels had breached its duties to the dealers by failing to disclose the Canada retainer and its decision that it would not act for the dealers if their interests came into conflict with Canada’s. The trial judge found that, had the dealers been properly represented and advised, they would have negotiated successfully with GMCL.

Cassels appealed the trial judge’s findings on liability and damages. Trillium cross-appealed on the issue of damages.

Issues:

(1) Did the trial judge err in finding an operative retainer between the other class members and Cassels?

(2) Did the trial judge err in finding that Cassels breached its obligations due to the Canada Conflict?

(3) Did the trial judge err in his treatment of the Saturn dealers?

(4) Did the trial judge err in his causation and loss of Chance Analyses?

(5) Did the trial judge err in his assessment of aggregate damages?

Holding: Appeal from liability issues dismissed, appeal from damages issues allowed, in part, cross-appeal dismissed.

Reasoning:

(1) No. The Court confirmed that the nature and scope of a solicitor’s retainer is a factual question on which the findings of the trial judge are entitled to great deference.

In determining whether Cassels breached its contract or its fiduciary duty, the trial judge needed to first determine if Cassels owed contractual or fiduciary duties to some or all of the class members. This determination rested, in the first instance, on whether a retainer between Cassels and the dealers existed and, if so, on the nature of the retainer. It did not require that the precise contours of any retainer found to exist be defined with exactitude. Rather, it only required an examination of the essential subject matter of the contract between the parties in order to then assess whether the contract had been breached.

The trial judge did exactly that. He devoted 23 paragraphs to the retainer issue, including 19 paragraphs expressly on the topic, “What was the scope of the retainer?” The Court held that when the trial judge’s reasons are read in context, they confirm that he came to grips with, and adequately articulated, the essential subject matter of the contract between the parties.

While the trial judge found that a retainer existed, he held that the scope of the retainer was ambiguous. As stated by the Supreme Court of Canada in Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633, in matters of contractual interpretation, “the overriding concern is to determine ‘the intent of the parties and the scope of their understanding’”. Further, in order to do so, “a decision-maker must read the contract as a whole, giving the words used their ordinary and grammatical meaning, consistent with the surrounding circumstances known to the parties at the time of formation of the contract.”

However, where there remains any ambiguity, legal principles dictate that this ambiguity must be resolved against Cassels. Accordingly, the trial judge found that the scope of the retainer was not strictly limited to representation in a possible CCAA proceeding. The retainer also included pre-filing advice on issues relating to the restructuring of the dealer network, which meant that Cassels was obligated to provide legal services to the dealers with respect to the Notices of Non-Renewal and the WDAs.

(2) No. Cassels breached its fiduciary and contractual obligations to the class members. The Canada retainer gave rise to a bright line conflict with the dealers’ retainer because the dealers’ interests were directly adverse to Canada’s immediate interests during the relevant period. Moreover, there was a substantial risk of a material and adverse effect on Cassels’ representation of the GMCL dealers by reason of its existing Canada Retainer, regardless whether Canada’s immediate interests and the interests of the GMCL dealers were adverse and even if Cassels’ characterization of a narrow and contingent retainer by the dealers had prevailed.

In R. v. Neil, 2002 SCC 70, [2002] 3 S.C.R. 631, the Supreme Court established the bright line test where a lawyer is not permitted to act for adverse clients unless both parties provide their informed consent. Similarly, in Canadian National Railway Co. v. McKercher LLP, [2013] 2 SCR 649, the Supreme Court of Canada outlined principles for determining whether a conflict of interest can be said to have arisen outside the scope of the bright line conflict rule. That is, the determination of whether a conflict falling outside the scope of the bright line conflict rule exists depends on whether the concurrent representation of the clients in question creates “a substantial risk that the lawyer’s representation of the client would be materially and adversely affected”.

Cassles agreed to act for the GMCL dealers despite its pre-existing Canada Retainer and failing to disclose the Canada Retainer and its implications to the dealers (the “Canada Conflict”). The parties’ interests were directly adverse to Canada’s immediate interests during the relevant period. The dealers wanted to get the most money possible from GMCL for their dealerships, and were willing to act as a spoiler in the run-up to a CCAA filing to get the best deal they could. In contrast, as the bailout party, Canada wanted GMCL to avoid a CCAA filing and to pay as little as possible to the dealers under the WDAs.

Cassles also breached its fiduciary and contractual obligations to the class members was by failing to advise CADA that it was in a conflict once the WDAs were delivered to some, but not all, dealers and nonetheless accepting CADA’s directions not to become involved with the WDAs. In fact, in an email by Bruce Leonard, one of Cassels’ partners, Leonard warned of these potential conflicts and said that, at a minimum, Cassels owed a duty to the dealers to advise them at the outset of the Canada retainer of all of the potential problems that could arise, and not simply to wait and see what happened. Cassels’ failure to make this disclosure was a breach of its duty to provide candid advice and disclosure to the class members.

(3) No. The trial judge addressed the essential subject matter and scope of the Saturn retainer. Saturn retained Cassels in March 2009 to provide legal advice with respect to GMCL’s legal ability to terminate the Saturn dealerships. Given that GMCL sought to effect this purpose through the WDAs, it follows that the Saturn retainer included advice regarding the Saturn WDAs.

Cassels owed the Saturn dealers a duty to advise them at the outset of the Canada retainer and all of the potential problems that could thereafter arise. However, Cassels never disclosed the Canada retainer to the Saturn dealers or the Saturn steering committee. Nor did it tell them about any constraint on its ability to represent the dealers, including Saturn Dealers, in any matter adverse to Canada’s interests. Cassels’ conduct regarding the Saturn Dealers in respect of the Canada Conflict amounted to a breach of the applicable standard of care.

(4) No. If Cassels had met the standard of care and provided proper advice to the dealers, the dealers, acting collectively, would have sought to negotiate with GMCL to improve their compensation under the WDAs. However, because Cassels failed to properly advise and represent the dealers, the dealers lost their only chance to negotiate with GMCL for this purpose.

While Canadian jurisprudence is unsettled as to whether an action for damages for a lost chance stands in tort, the doctrine of lost chance in contract law has been expressly recognized both in Canada and England. Proof of damage is not part of the liability inquiry in contract law. Moreover, plaintiffs may advance a claim for damages for “loss of chance” in solicitors’ negligence cases. The analysis of that claim had two components – causation and quantum.

The dealers’ lost chance to negotiate with GMCL was real and significant. The trial judge found that but for Cassels’ divided loyalty, Cassels would likely have provided advice to the dealers about the WDAs and proposed the option of collective negotiation with GMCL. If the dealers had been properly advised and represented by Cassels, they would have banded together and instructed Cassels to negotiate with GMCL regarding the WDAs. It was likely that GMCL would have negotiated with the dealers. Further, there was a real chance that those negotiations would have proven to be productive

With respect to the quantum component of the analysis, Cassels argued that the trial judge was obliged to identify and assign each step in the causation chain a percentage chance of occurrence, and then multiply those percentage chances of each contingency occurring in order to determine an overall percentage probability of the dealers achieving a successful outcome in negotiations with GMCL. However, this “cumulative probabilities” approach has not been employed in other loss of chance cases and has been specifically rejected by some courts in England.

In any case, the trial judge found that, absent a breach by Cassels, the dealers had a 55 percent chance of obtaining a successful negotiation with GMCL for more compensation under the WDAs. The trial judge took into account all of the contingencies identified by the parties, including the fact that the dealers potentially stood to realize nothing in any CCAA filing. He also recognized that a loss of chance will be smaller when more contingencies are involved. However, the trial judge concluded these contingences did not negate the dealers’ chance of achieving a higher payout through negotiation, nor did they push the chance outside the realm of real and significant possibility.

(5) Yes. The trial judge calculated the lost chance as the difference between the amount approved by GMCL’s US parent as being available to pay the dealers and the amount paid: $218 million – $126 million = $92 million. The trial judge erred in using the $126 million figure, the amount paid, as the second number. Neither side in hypothetical negotiations could have known that 38 terminated dealers would reject the WDAs. The offers on the table totalled $143.5 million. Unbeknownst to the dealers, GMCL had $218 million to spend. The trial judge should have calculated the value of the lost chance to negotiate successfully as the difference between the money approved for the WDAs and the money offered: $218 – $143.5 = $74.5 million. This reduces the overall starting point for the quantification of the aggregate damages award from $92 million to $74.5 million.

The question of the final quantification of damages by applying the lost chance analysis should be remanded to the trial judge for further consideration using $74.5 million as the starting point.

Trillium Motor World Ltd. v. General Motors of Canada Limited, 2017 ONCA 545

[Cronk, van Rensburg and Pardu JJ.A.]

Counsel:

D. Sterns, Al. D.J. Dick, A. Seretis, B. Finlay Q.C., M. Vermette and M. Statham, for the appellant/respondent by cross-appeal Trillium Motor World Ltd.

K. Thomson, J. McCamus, S. R. Campbell, S. L. Weingarten, D. S. Morritt and K. Sachar, for the respondent/appellant by cross-appeal General Motors of Canada Limited

Keywords: Franchise Law, Arthur Wishart Act (Franchise Disclosure), 2000, section 11, 1518628 Ontario Inc. v. Tutor Time Learning Centres, LLC, 2006 CanLII 25276 (S.C.), Contracts, Enforcability, Public Policy, Class Proceedings, Class Proceedings Act, section 31(2), Costs  

Facts:

This is the first of two appeals and cross-appeals that arose out of the public bailout of General Motors of Canada (“GMCL”) in the spring of 2009. This decision addresses a class action against GMCL brought by franchisees whose dealerships were terminated as part of the bailout, and a counterclaim by GMCL against the franchisees.

GMCL became insolvent in May 2009. To survive and avoid proceedings under the Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-26 (“CCAA”), it required bailout money. The Canadian and US governments demanded that GMCL aggressively restructure as a condition of providing the assistance. On May 20, 2009, GMCL delivered Wind-Down Agreements (“WDAs”) to 240 dealers. The WDAs offered payment in exchange for a release of all claims, including those that could be advanced under the Arthur Wishart Act (Franchise Disclosure), 2000, S.O. 2000 c. 3 (the “Act”), and provided for an end to the dealers’ business relationships with GMCL.

The WDAs also contained a promise by the signing dealer not to sue GMCL. They required the dealer to opt out of or disclaim any interest in any future class proceeding that purported to assert claims released by the WDAs. They required any dealer who failed to opt out to indemnify GMCL against any damages and legal costs GMCL might subsequently incur by defending a class proceeding.

202 out of the 240 dealers signed the WDAs and accepted the payment offered. After GMCL made its final payments, a class proceeding was brought on behalf of all dealers who signed the WDAs, claiming that GMCL breached the rights provided to these franchisees under the Act. The appellant Trillium Motor World Ltd. (“Trillium”) was named as the representative plaintiff.

The trial judge held that GMCL acted honestly and fairly and did not breach the dealers’ rights under the Act. He further held that the releases barred the dealers’ class proceeding. Trillium appealed these rulings. The trial judge also concluded that the dealers’ promises not to sue GMCL, and to indemnify GMCL should a dealer fail to opt out of class proceedings were void on public policy grounds. GMCL cross-appealed on this ruling.

At trial, the arguments turned on whether the WDAs were settlement agreements and therefore fell within the judicially-developed exception to the application of s. 11 of the Act articulated in 1518628 Ontario Inc. v. Tutor Time Learning Centres, LLC, 2006 CanLII 25276 (S.C.) (“Tutor Time”). Section 11 of the Act provides that “any purported waiver or release by a franchisee of a right given under this Act or of an obligation or requirement imposed on a franchisor or franchisor’s associate by or under this Act is void”.

Issues:

(1) Did the trial judge err by failing to consider the remedial purposes of the Act in finding that the releases were operative?

(2) Did the trial judge err by applying the Tutor Time exception to this case?

(3) Did the trial judge err by not finding that GMCL breached its duty of fair dealing as a result of the manner in which it obtained the releases?

(4) Were the covenants not to sue and indemnify void for public policy reasons?

(5) If so, is the trial judge required to find the whole release void for public policy reasons?

Holding: Appeal dismissed. Cross-appeal dismissed.

Reasoning:

(1) No. The trial judge explicitly stated that the “overarching purpose” of the Act is to “mitigate and alleviate the power imbalance that exists between franchisors and franchisees”. The perilous financial circumstances that GMCL faced at the time were an important part of the factual context. In addition, GMCL also owed duties to the dealers who did not sign WDAs.

(2) No. According to Tutor Time, a voluntarily-negotiated settlement of existing statutory claims, entered into with the benefit of legal advice, in settlement of a dispute for existing and known breaches of the Act is not caught by s. 11 of the Act. A settlement is a voluntary arrangement that brings a dispute or potential dispute to an end: Data General Canada Ltd. v. The Molnar Systems Group Inc. (1991), 6 O.R. (3d) 409 (C.A.), at p. 415. The Court of Appeal agreed with the trial judge’s conclusion that the release in this case characterized the WDA document as a settlement. Furthermore, each dealer who signed a WDA obtained legal advice and knew that they were giving up any legal claims they might have against GMCL.

(3) No. The trial judge held that GMCL did not breach the duty of dealing fairly with the terminated dealers when presenting them with the WDAs. That conclusion was reasonably open to him and the Court of Appeal found no basis to intervene.

(4) Yes. The difference in treatment between individual litigants and members of a class is expressly contemplated by s. 31(2) of the Class Proceedings Act, 1992, S.O. 1992 c. 6. Class members, other than the representative party, are not liable for costs except with respect to the determination of their own individual claims. GMCL’s counterclaim is, in essence, a claim for reimbursement of its costs in defending the class proceeding. Given that the legislature has adopted a policy that class members are not liable for costs, the Court of Appeal saw no error in the trial judge’s conclusion that public policy barred enforcement of the covenant not to sue.

(5) No. The trial judge held that the Tutor Time exception applied, and he favoured the public policy of giving effect to settlements of known and existing claims reached with the benefit of legal advice. The dealers who signed the WDAs were enriched by execution of the agreements; they received payments to which they would not have been otherwise entitled. The Court of Appeal did not identify any palpable and overriding error in the trial judge’s conclusion that, although the release was valid, the covenant not to sue was void and severable.

Accordingly, the Court of Appeal dismissed the appellant’s appeal and the respondent’s cross-appeal.

Abou-Mansour v. Abou-Mansour, 2017 ONCA 572
[Sharpe, Lauwers and Miller JJ.A.]

Counsel:

N. Denchik, for the appellant

J. Rechtstaffen, for the respondent

Keywords: Family Law, Civil Procedure, Adjournments, Evidence, Cross-Examination

Facts:

Based upon medical evidence, the trial judge found that the respondent was unemployed and effectively unemployable and therefore refused to impute income.

Issues:

(1) Did the trial judge err by curtailing the appellant’s cross-examination of the respondent with respect to his medical condition, or by failing to grant the appellant an adjournment to summons additional witnesses?

Holding:

Appeal dismissed.

Reasoning:

(1) No. The trial judge enforced the time limits set out in the trial scheduling form, and the appellant did not ask for more time to continue her cross-examination. Nor did the appellant provide the trial judge with a reasonable explanation as to why the witnesses had not been summoned in a timely manner prior to trial. The trial judge therefore made no error in refusing an adjournment.

Morriseau v. Sun Life Assurance Company of Canada, 2017 ONCA 567

[LaForme, Hourigan and Paciocco JJ.A.]

Counsel:

R.E. Somerleigh and V. Popescu, for the appellant

S. Simpson and E. Bennett-Martin, for the respondent

Keywords: Labour Law, Collective Agreements, Mandatory Arbitration, Insurance Law, Long-Term Disability Benefits, Jurisdiction, Rules of Civil Procedure, Rule 21.01(3)(a)

Facts:

The appellant was a unionized employee of Lakehead District School Board (“LDSB”), subject to a collective agreement that provided certain long-term disability (“LTD”) benefits. The LDSB was self-insured with respect to LTD benefits. The respondent was contracted with the LDSB to provides administrative services with respect to LTD benefits. The respondent effectively acted as agent for the LDSB, while the LDSB had final decision-making power for the payment of LTD benefits.

The appellant sought LTD coverage following a motor vehicle accident, but that request was denied in a letter sent to her by the respondent. She then commenced an action seeking, among other things, a declaration that she was totally disabled within the definition in the contract between the respondent and the LDSB, and an order requiring Sun Life to approve the payment of LTD benefits.

The motion judge found that the court did not have jurisdiction, because the dispute arises from the interpretation, application or administration of a collective agreement. Accordingly, he struck the appellant’s statement of claim.

Issues:

(1) Is the respondent not a party to the collective agreement, in which case it does not have standing to challenge the court’s jurisdiction?

(2) Did the motion judge err in finding that the essence of the dispute involved a subject matter covered by the collective agreement?

(3) Does the motion judge’s order leave the appellant without a remedy?

Holding:

Appeal dismissed.

Reasoning:

(1) No. Pursuant to r. 21.01(3)(a) of the Rules, the respondent had standing to have the action dismissed on the basis that the court lacked jurisdiction. The respondent was named as the defendant in the within action, and r. 21.01(3)(a) provides that a defendant may move to have an action dismissed on the ground that the court has no jurisdiction over the subject matter of the action.

(2) No. The standard of review on a finding that the collective agreement covers the subject matter of the dispute is palpable and overriding error. The Court of Appeal rejected the argument that the motion judge made any such error. The language of the collective agreement supported a finding that the LDSB was required to pay benefits under that agreement, not the respondent. Moreover, the motion judge’s analysis was supported by the analysis of comparable collective agreements in other case law.

(3) No. The real dispute was between the appellant and the LDSB, against whom the appellant might seek an appropriate remedy through arbitration. There is no contract between the appellant and the respondent, and there was no legal basis upon which to order that benefits be paid by the respondent. The entitlement to LTD benefits is a product of collective bargaining, and any dispute is therefore arbitrable under the collective agreement. The appellant did not advance any convincing grounds for concluding that an arbitrator would decline jurisdiction over a claim for those benefits.

Aviva Insurance Co. of Canada v. McKeown, 2017 ONCA 563

[Juriansz, Pepall and Miller JJ.A.]

Counsel:

E.K. Grossman, for the appellant

V. Chowbay, for the respondents

Keywords: Insurance Law, Insurance Act, Ontario Regulation 34/10, Statutory Accident Benefits Schedule s. 33(4) 3 (“SABS”), Examinations Under Oath, Automobile Insurance Rate Stability Act, Automobile Insurance Rate Stabilization Act, Financial Services Commission of Ontario Act, Statutory Interpretation

Facts:

Six applicants for benefits demanded that Aviva provide a “reason” in the sense of a “justification” for its request that they attend examinations under oath (“EUO”). Aviva brought an application for a declaration that a justification was not required, and for an order compelling the six applicants to attend examinations. The application judge dismissed the application and issued a declaration that an insurer must provide a “justification” to compel an applicant for statutory benefits to attend an EUO if the insurer requests one pursuant to s. 33(2) of the SABS.

Issues:

(1) Does an insurer have to provide a “justification” in order to exercise its statutory right to examine under oath an applicant who has claimed benefits under the SABS?

Holding: Appeal allowed.

Reasoning:

(1) No. An insurer is not required to provide a justification for its request that the applicant attend an EUO. A general statement of the purpose of the EUO that provides notice of the general types of questions that will be asked is sufficient. Applicants must attend the EUOs. Following is the legal reasoning applied by the Court:

(a) The proper approach to statutory interpretation is to read the words of an Act in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act and the intention of the legislature.

(b) The application judge’s interpretation of s. 33 is reviewable on a correctness standard. In adopting the meaning “justification” for the word “reason,” the application judge drew unsupported inferences, employed extraneous considerations, and failed to consider the entire legislative context of s. 33(4)3.

(c) The two main overall objectives of the Ontario automobile insurance regime are consumer protection and guaranteed compensation of victims. Smith v. Co-Operators General Insurance Co., 2002 SCC 30 at para. 11; Peixeiro v. Haberman, [1997] 3 S.C.R. 549 at paras. 22-24.

(d) The legislative objectives in creating the EUO were to reduce insurance costs, address fraud and increase accountability within the system. The application judge erred by reasoning that the use of EUOs might result in an increase in the overall costs of the system.

(e) The application judge was correct in observing that Ontario’s automobile insurance system was, and is, intended to be an efficient, no-fault regime and as non-adversarial as possible. However, her apprehension that unless an insurer is required to provide a justification for an EUO, the process would become more adversarial, was misplaced.

(f) Legislative history indicates that the EUO was created as an additional “mechanism” to accomplish the legislative objective of the quick and expeditious determination of claims and of increasing accountability within the system.

(g) Analogies to civil litigation are unhelpful in a statutory regime meant to replace tort law because the legislative object of the automobile insurance regime is to replace the tort resolution of disputes arising from automobile accidents with the process it prescribes. Requiring insurers to provide justification for EUOs is not in keeping with the non-adversarial process intended by the legislature.

(h) The modern approach to statutory interpretation is the mandated purposive approach, but it must be applied to the text considered in its entire context. Bell ExpressVu Ltd. Partnership v. Rex, 2002 SCC 42 at para. 26.

(i) One theme of the procedures for claiming benefits set out in the SABS is that the insured person must cooperate with the insurer so that the insurer has the information necessary to determine the entitlement. Similarly, the SABS creates a number of mechanisms that allow the insurer to request information and documentation from the applicant. Thus, requiring an insurer to provide a justification for its request for an EUO is not in keeping with the cooperative approach to information sharing through the SABS.

(j) The SABS has provisions with limitations, such as s. 33(2), s. 37, s. 44(1), and s. 44(5). If the legislature intended to limit or qualify s. 33(4)3, it would have been included under the qualifications of s. 33(2).

(k) The insurer’s duty to act in good faith applies throughout its processing of an application for benefits, and the practices of an insurer are subject to the general supervision of the Superintendent as per the FSCO Act, s. 5(2)(c). The Superintendent has powers pursuant to the Insurance Act, s. 439 and s. 440, to investigate and sanction “Deceptive Acts and Practices.” This is the legislated route to address non-compliant EUOs.

(l) The court need not defer to a tribunal in interpreting the relevant legislation when jurisdiction over the legislation is shared: Rogers Communications, 2012 SCC 35. However, when exercising coordinate jurisdiction, a court should proceed with a full appreciation of the expertise of the tribunal. Although jurisdiction is no longer shared with FSCO (exclusive jurisdiction to hear such appeals now lies with the Licence Appeal Tribunal, the FSCO arbitrator’s interpretations of SABS are still persuasive authority.

Ares Law Professional Corporation v Rock, 2017 ONCA 569

[LaForme, Hourigan and Paciocco JJ.A.]

Counsel:

L. James, for the appellant

P.J. Pape and J.L. Nairn, for the respondents

Keywords: Contracts, Settlements, Solicitor and Client, Assessment of Accounts, Solicitors Act, s. 3, Cohen v Kealey & Blaney (1985), 10 OAC 344

Facts:

The respondents were retained pursuant to a contingency fee agreement with the appellant, the client in an action against Food Basics. After five-years, the solicitor-client relationship broke down and the respondents were removed as solicitors of record. The appellant retained new counsel, Mr. Igbinosun. After the retainer was terminated, the respondents, the appellant and Mr. Igbinosun entered into an agreement (the “Undertaking”), which provided that Mr. Igbinosun and the appellant were undertaking to protect the account of the respondents in the amount of no more than $50,000. This amount could be subject to possible negotiated reduction or an assessment.

Mr. Igbinosun passed away and the appellant chose to self-represent. The appellant entered into a settlement agreement with Food Basics, which provided that Food Basics would pay costs directly to the respondents. It did not contain any reference to the Undertaking. Food Basics informed the respondents that their insurer was willing to cover the cost of some of the disbursements and to pay half of the appellant’s outstanding account to settle the action the respondents had brought against the appellant. Later on, they advised Food Basics was willing to pay half of the respondents’ listed disbursements, $5,000 of their legal fees, or alternatively, whatever amount would be determined by an assessment officer. The respondents accepted the offer and the matter proceeded to assessment.

The assessment officer rejected the argument that the Undertaking applied to limit the respondents’ total recovery to $50,000 and held it would have applied had Mr. Igbinosun represented the client at the time of the settlement, but because the client was then acting for himself the agreement no longer governed. The Undertaking had not been incorporated into the settlement with Food Basics and the appellant should reasonably expect to pay fees pursuant to the retainer agreement. The assessment officer assessed the outstanding amount at $125,602.83.

The appellant brought a motion to oppose confirmation of the assessment, and the respondents brought a cross-motion for judgment in the amount of the assessment. The motion was dismissed and the cross-motion was allowed. The appellant filed a second appeal to the Court of Appeal and is advancing essentially the same arguments as it did on the confirmation motion.

Issues:

(1) Did the assessment officer err in failing to appreciate the “peculiar position” of Food Basics, and improperly interpreted “the client” to mean Food Basics instead of the appellant?

(2) Did the assessment officer misapprehend the evidence regarding the true value of the claim in determining the reasonableness of the lawyer’s fees?

(3) Did the assessment officer lack jurisdiction due to “special circumstances” present in this assessment?

(4) Did the assessment officer and motion judge err in treating the Undertaking as irrelevant to the client’s expectations regarding costs because Food Basics was not party to it?

Holding: Appeal dismissed.

Reasoning:

(1) No. The court held it was evident on a reading of the assessment officer’s decision that he appreciated that the appellant was the client.

(2) No. The court held that although the assessment officer found that the value of the claim was likely higher than the $30,000 for which it was settled, the history of this litigation provided ample evidence in support of that view.

(3) No. The court held the motion judge was correct in finding that the issues identified by the appellant did not constitute special circumstances that would impact the assessment officer’s jurisdiction. The court held special circumstances that operate to oust jurisdiction are exceptional situations, particularly those that cause quantum and accounting of fees to become entwined with larger legal and factual questions, such that assessing costs necessarily requires answering questions outside the assessor’s jurisdiction. They are typically “questions that require a decision from the court by action or application”. The court held there were no such questions at play here.

(4) No. The court held that if the appellant believed the Undertaking applied to limit the assessed account, then he had the obligation to raise that issue in advance of the hearing, which he failed to do. Moreover, the court found that had the Undertaking applied, by its terms it was “subject to negotiation between the parties and, if necessary, further assessment proceedings”, and such an assessment proceeding did occur. Finally the court held that parties had agreed to be bound by the result of the assessment.

Angus v. Port Hope (Municipality), 2017 ONCA 566

[Strathy C.J.O, Gillese and Pardu JJ.A.]

Counsel:

C.G. Paliare, R.P. Stephenson and L. Scott, for the appellant

A.J. Lenczner, Q.C. and P.E. Veel, for the respondent

Keywords: Contracts, Interpretation, Sattva Capital Corp. v. Creston Molly Corp., 2014 SCC 53, Heritage Capital Corp. v. Equitable Trust Co., 2016 SCC 19, Trusts, Three Certainties, Certainty of Intention, Charitable and Non-Charitable Purpose Trusts, Perpetuities Act, Schmidt v. Air Products Canada Ltd., [1994] 2 S.C.R. 611

Facts:

In 2000, the Government of Canada (“Canada”) and the former municipalities of the Town of Port Hope, the Township of Hope, and the Municipality of Clarington (collectively, the “Municipalities”) struck a deal: Canada would make a payment of $10 million to each of the Municipalities in exchange for each of the Municipalities storing low-level radioactive waste (the “Waste”) at safe sites within their respective communities. The parties “papered” the deal with an agreement executed by the Municipalities in December 2000 and by Canada on March 29, 2001 (the “Agreement”).

On January 1, 2001, Hope Township and the Town of Port Hope were amalgamated into a new entity called the Corporation of the Town of Port Hope and Hope (the “Municipality of Port Hope”). On April 12, 2001, the Municipality of Port Hope received two $10 million cheques from Canada, which was the payment due to Hope Township under the Agreement (the “Payment”). When the payment was received, no trust agreement had been concluded between Hope Township and Royal Trust (at the time of the initial agreement, the proposed trustee) nor had any such agreement been concluded between the Municipality of Port Hope and Royal Trust.

In 2014, an application was brought in which it was alleged that the Municipality of Port Hope had misused the income earned on the Payment because it had failed to apply that income exclusively to defray the lower tier municipal taxes or levies of ratepayers of the former Hope Township. The application judge granted the application and interpreted the Agreement as having created a non-charitable purpose trust that was saved by s. 16 of the Perpetuities Act. Further, he found that the Municipality of Port Hope breached its duties as trustee because it failed to use the power to appoint in accordance with the strict terms of the trust.

Issues:

(1) Did the Agreement constitute a contract and thus not establish a trust over the Payment?

(2) Did the Agreement create a charitable trust, not a non-charitable purpose trust?

Holding: Appeal allowed and cross-appeal dismissed.

Reasoning:

(1) Yes. The Agreement did not create a trust and the Municipality of Port Hope did not breach its duties in respect of the Payment and income earned on it (“Hope Township Fund”). The legal interpretation of the Agreement, including Schedules, involves issues of mixed fact and law, thus the court owes deference to the decision of the application judge. However, deference is not owed where, as in this case, the first-instance decision maker has made an extricable legal error, which includes a failure to apply the correct principle, a failure to consider a required element of a legal test, or a failure to consider a relevant factor. Sattva Capital Corp. v. Creston Molly Corp., 2014 SCC 53 at paras. 50-53; Heritage Capital Corp. v. Equitable Trust Co., 2016 SCC 19 at para. 21-22.

(2) No.

(a) The Agreement, including Schedules, is a contract. Notwithstanding that a contract can create a trust, this Agreement provides the context within which Schedule 8 is to be interpreted, and was unquestionably a contract: a written expression of the mutually beneficial commercial bargain struck between the parties.

(b) Canada’s Payment to Hope Township was the discharge of its contractual obligation under Article 7.1(b) of the Agreement. Canada did not and could not make the Payment as the settlor of a trust and did not settle the Payment on trust. To settle property on trust, one must intend that the property be the subject of the trust.

(c) Article 7.1(b) of the Agreement did not create a trust. 7.1(b) contained permissive language, allowing Hope Township to use the Payment as it saw fit. Since there are no constraining words in 7.1(b), it cannot have created a trust over the Payment.

(d) Pursuant to Article 7.2 of the Agreement, Hope Township had to deal with the Payment in accordance with Schedule 8.

(e) Schedule 8 did not create a trust of the Payment or of the Hope Township Fund. It did not create a non-charitable purpose trust, an express trust for persons, or a charitable trust.

The application judge erred by finding a non-charitable purpose trust by: (1) incorrectly applying the law governing non-charitable purpose trusts (see Schmidt v. Air Products Canada Ltd., [1994] 2 S.C.R. 611 at 640-641); and (2) making a finding contrary to the parties’ express intentions in the Agreement.

Non-charitable purpose trusts differ in that the funds are placed in trust not for persons but to see that a particular purpose is fulfilled. The Agreement expressly stated that the “ratepayers” were the beneficiaries of the Payment.

Creation of an express trust requires an intention to create a trust. To find that an express trust for persons has been created, there must be certainty of intention, certainty of subject matter, and certainty of objects. Certainty of intention can be found to exist where a person who owns property transfers it to another (the trustee) with the intention that the trustee hold and manage the property for the exclusive benefit of others. Certainty of subject matter requires the subject matter of the trust to be ascertained or ascertainable. Certainty of objects requires a determinate number of people with identifiable future members. Notwithstanding the reflexive nature of the certainties, none of the three were met. Moreover, the reflexive nature of the certainties reinforces that there was no intention to create a trust.

The Agreement had provisions for tax abatements. As such, it was not a purpose that the law regards as charitable, thus a charitable trust could not have been created. On this point the cross-appeal was dismissed.

(f) The Municipality of Port Hope did not become a trustee nor did it breach its obligations in respect of the use of the Hope Township Fund. While Schedule 8 originally provided that Payment was to be made to a trustee, an agreement could not be finalized with a trustee and an amendment was made to the Agreement. The amendment expressly authorized the Municipality of Port Hope to use an investment counsellor to manage the Hope Township Fund, thereby extinguishing any obligation to create a trust. The Municipality of Port Hope could not have breached its obligations as there were no trust obligations attached to the use of the Hope Township Fund.

Canadian Northern Shield Insurance Company v. 2421593 Canada Inc., 2017 ONCA 570

[LaForme, van Rensburg and Huscroft JJ.A.]

Counsel:

M.A. McKillop and J.A. Caldwell, for the appellants

G.R. Hall and J.L. Cole, for the respondents, 2421593 Canada Inc. and Vancouver City Savings Credit Union

B.H. Bresner, for the respondents, The Co-operators Group Limited, Federated Agencies Limited and 7081332 Canada Ltd.

Keywords: Contracts, Interpretation, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633, Inducing Breach of Contract, Summary Judgment

Facts:

The appellants commenced an action against 2421593 Canada Inc. (“Vancity Insurance”) and Vancouver City Savings Credit Union (together the “Vancity respondents”) for damages and other relief following the alleged breach of an oral agreement. They also sued The Co-operators Group Limited (“Cooperators”), Federated Agencies Limited and 7081332 Canada Ltd. (together the “Co-operators respondents”) for damages for inducing breach of contract.

Each of the two groups of respondents brought motions for summary judgment.  The motion judge dismissed the action, primarily because he concluded on his review of the evidence that the parties expected and required there to be a signed written agreement in order for there to be a binding contractual agreement (referred to on in this case as the “Precondition”). This disposed of the claims for breach of contract and for inducing breach of contract. He also determined that, in any event, the decision of the Vancity respondents not to proceed with the alleged contract with CNS/RSA could not have been induced by Co-operators several months later.

Issues:

(1) Did the motion judge err in finding the existence of the Precondition, and therefore err in granting summary judgment against the Vancity respondents?

(2) If the motion judge erred in granting summary judgment, should the dismissal nevertheless be upheld on the basis that there is no genuine issue requiring trial?

(3) Did the motion judge err in granting summary judgment against the Co-operators respondents?

Holding:

Appeal allowed with respect to the action against the Vancity respondents. Appeal dismissed with respect to the Co-operators respondents.

Reasoning:

(1) Yes. The motion judge’s finding that there was a Precondition – that is, that the parties’ intended and agreed that their “legal obligations were to be deferred until a formal contract had been approved by both sides and executed” – was a palpable and overriding error. The evidence reviewed was not capable of supporting such a conclusion, whether considered individually or cumulatively. The evidence only goes so far as to support the conclusion that the parties intended and agreed to eventually set out their agreement in writing, and that they were taking steps to negotiate the terms of their contract, not that they had “established that both sides acted on the understanding and intent that there was to be a formal executed written contract in order to be legally bound”. Consequently, the motion judge’s grant of summary judgment relied on a fundamentally flawed analysis, and was therefore erroneous.

(2) No. The motion judge held that if he had considered it necessary to decide whether an oral agreement had come into being, he “would be inclined to order a trial of the issue in spite of the agreement of the parties that the case [could] be decided on a motion for summary judgment without the need for a trial”. The Court of Appeal observed that there were several factual disputes that remained unresolved, and the Court of Appeal was therefore not in a position to adjudicate.

(3) No. The motion judge additionally provided a reasonable, alternative basis for dismissing the claim against the Co-operators respondents that did not rely on his conclusions with respect to whether a binding contract had been formed. There was no evidence that Co-operators deliberately sought to procure the termination of the alleged oral contract, nor that Co-operators was even in a position to determine whether a contract in fact existed. Lastly, the timing of events was such that the Vancity respondents had decided against settling contractual terms with the appellants several months before Co-operators engaged in the alleged inducements.

K.F. v. Family and Children’s Services of the Waterloo Region, 2017 ONCA 573

[Sharpe, Lauwers and Miller JJ.A.]

Counsel:

G. Ichim, for the appellants

J. Boich, for the respondents

Keywords: Family Law, Access, Child and Family Services Act, R.S.O. 1990, c. C.11, s. 69(6), Fresh Evidence, Catholic Children’s Aid Society of Metropolitan Toronto v. C. M., [1994] 2 S.C.R 165

Facts:

This is an appeal from an order of the Superior Court dismissing an appeal from an order of the Ontario Court of Justice making an order of Crown wardship with no access by either parent.

The child was apprehended at the age of eight weeks, at the same time, three other children of the appellant were apprehended. The appellant had a long-standing history with the respondent. The immediate reason for the apprehension was that the older children expressed a fear of violence by the appellant’s then partner, the father of the child who is the subject of this appeal. The child has been in the custody of prospective adoptive parents for approximately four years.

Fresh evidence in child protection matters is contemplated by the Child and Family Services Act, R.S.O. 1990, c. C.11, s. 69(6) (the “Act”). The test for admission is set out in Catholic Children’s Aid Society of Metropolitan Toronto v. C. M., [1994] 2 S.C.R. 165 at 190:

(a)   could the evidence have been previously adduced;

(b)   is the evidence highly relevant;

(c)   is the evidence potentially decisive to a best interest determination; and

(d)   is the evidence credible.

The respondent sought to introduce the affidavit of a Children’s Aid Society (“CAS”) services worker that provided up to date information on the circumstances of the child. This is the type of evidence contemplated by s. 69(6) of the Act. Accordingly, the Court of Appeal admitted the evidence from the CAS.

The appellant also sought to introduce fresh evidence. Firstly, the appellant sought to introduce video evidence of access visits between the child and the appellant. Since the CAS fresh evidence related to the circumstances of the appellant’s access visits, the Court of Appeal held that it was appropriate to admit the video recordings tendered by the appellant.

The appellant further sought to introduce affidavit evidence from a doctor who had not seen the child. However, the Court of Appeal found this evidence problematic because the appellant failed to provide an adequate foundation to assess the doctor’s expertise with respect to the general view that the doctor expressed regarding open adoption. Notwithstanding this oversight, the Court of Appeal reviewed the doctor’s affidavit.

The appellant sought to have access to the child.

Holding: Appeal dismissed.

Issues:

(1) Should the Court grant the appellant access to the child?

Reasoning:

(1) No. Section 59(2.1) of the Act provides that when a Crown wardship order is made, no order of access shall be made unless (a) the relationship between the person and the child is meaningful and beneficial to the child; and (b) the ordered access will not impair the child’s future opportunities for adoption. The onus for establishing those factors rests with the party seeking access.

The trial judge found that there was no evidence that the relationship between the child and the appellant was beneficial to the child. That finding, made when the child was two and a half years old, is entitled to deference in the Court of Appeal. Moreover, the issue was not who was at fault for a breakdown in the relationship between CAS and the appellant. Instead, the issue was about the best interest of the child in regards to the appellant being granted access.

Neither the video tendered by the appellant, nor the doctor’s affidavit provided a sufficient basis to disturb the findings of the trial and appeal judges that the appellant failed to show that she should have access, despite Crown wardship, on the basis that the relationship between her and the child is meaningful and beneficial to the child.

Polish Alliance of Association of Toronto Limited v. The Polish Alliance of Canada, 2017 ONCA 574

[Hoy A.C.J.O., van Rensburg and Trotter JJ.A.]

Counsel:

B.A. Kaminski, for the appellant

B. Romano and J. Nussbaum, for the respondents

Keywords: Corporations, Non-Share Capital Corporations, Corporations Act, R.S.O. 1990, c. C38, Unincorporated Voluntary Associations, Variation of Trusts Act, R.S.O. 1990, c. V. 1

Facts:

This action arises out of a dispute between the appellant and respondents about a clubhouse on Lakeshore Boulevard in Toronto estimated to be worth $50 million or more. The respondents are 28 members of the appellant Polish Alliance of Canada, an organization incorporated under the Corporations Act, R.S.O. 1990, c. C38. The respondents sought to separate from the appellant and take with them the property in dispute.

At the initial hearing, the court determined that the respondents’ withdrawal from the appellant’s organization was invalid due to not having the unanimous consent of the members. In addition, the court noted that had their withdrawal been valid, they would have been entitled to take the property with them because the property was being held for them in trust from time to time. The respondents appealed to the Ontario Court of Appeal but their appeal was dismissed because the court found no basis to interfere with the application judge’s decision. However, the court stated that future attempts to withdraw from the organization may be valid.

The respondents subsequently asked the trial judge to reconsider their withdrawal after they had obtained unanimous consent from the members. The judge granted their requested judgment. The appellants now appeal this decision.

Issues:

  • Did the trial judge err in concluding the clubman’s veto applied?
  • Did the trial judge err in concluding that the consent to withdraw was unanimous?
  • Did the trial judge err in concluding that the respondents were entitled to take the property with them when they left?
  • Did the trial judge err in suggesting the Variation of Trusts Act as an alternative basis for relief?

Holding: Appeal dismissed.

Reasoning:

(1) No. The appellants argue that the clubman’s veto does not apply because the Polish Alliance of Canada is incorporated under the Corporations Act. This does not matter because the respondents were part of an unincorporated association seeking to leave the incorporated association.

(2) No. The appellants argue that the trial judge did not count the number of members correctly. The number of members was determined by a court order, and that is what the trial judge relied on. It is not now open to the appellants to argue against the membership determined by court order.

(3) No. It is not open to the appellants to revisit questions of title to the property.

(4) No. The trial judge relied on the clubman’s veto in granting relief, not the Variation of Trusts Act.

Couper v. Nu-Life Corp., 2017 ONCA 571

[LaForme, Hourigan and Paciocco JJ.A.]

Counsel:

J.J. Pirie and J.R. Bernardo, for the appellants and respondents by way of cross-appeal

J.J. Adair, for the respondent and appellant by the way of cross-appeal

Keywords: Employment Law, Contracts of Employment, Damages

Facts:

This appeal and cross appeal arise out of an oral employment agreement between two friends and their respective companies. Mr. Couper was president of the appellant corporation, Nu-Life Corp. (“Nu-Life”). He was friends with Mr. Frankel, the senior executive officer of Vitaquest International LLC (“Vitaquest”). Vitaquest eventually became the primary financier of Nu-Life. Nu-Life became insolvent in 2002 requiring it to restructure. After restructuring, Vitaquest held 90 percent equity in Nu-Life and Mr. Couper and Mr. Frankel began discussions about an employment contract for Mr. Couper at Vitaquest. The trial judge found an oral employment agreement was reached in October 2003 and granted judgment to Mr. Couper for unpaid salary, but not for a $5 million payment. Both sides appealed.

Issues:

  • Did the trial judge err in finding that the respondent Mr. Couper was entitled to damages equivalent to base pay for the period October 2003 to March 2005?
  • Did the trial judge err in finding that the appellant Mr. Couper was not entitled to a US$5 million payment from Vitaquest?

Holding: Appeal and cross-appeal dismissed.           

Reasoning:

(1) No. Vitaquest submitted that damages ought to be calculated on the basis of pay in lieu of reasonable notice, and further submitted that the employment agreement came to an end on November 14, 2013. This is incorrect. The appropriate measure of damages is a straightforward calculation of unpaid base wages from October 20, 2003 to March 2005, because this is a case for unpaid base salary, not wrongful dismissal. In addition, the trial judge’s finding that the employment agreement was repudiated by Vitaquest in March 2005 is entitled to deference.

(2) No. There is no reason to interfere with the trial judge’s conclusion that no term entitling Mr. Couper to a US$5 million payment was included either in the employment agreement or any separate agreement.

John v. Ballingall, 2017 ONCA 579

[Doherty, Benotto and Trotter JJ.A.]

Counsel

M. Zemel and O. Ha-Redeye, for the appellant

I. Fisher and K. Pulfer, for the respondents

Keywords: Torts, Defamation, Libel, Limitation Periods, Libel and Slander Act, ss. 5(1) and 6, Striking Pleadings, No Reasonable Cause of Action, Rules of Civil Procedures, r. 21

Facts: The appellant is a rapper who performs under the name of Avalanche the Architect. The appellant wrote a rap song entitled “Got Yourself a Gun”. As a result of the content of the lyrics, he was criminally charged with uttering threats to cause death or bodily harm and criminal harassment. The respondent Alex Ballingall, a reporter working for the respondent, Toronto Star, contacted the appellant and conducted an interview with him. Ballingal’s article was published in the Star’s online version on December 4, 2013, and described the criminal proceedings. It was titled “Rapper says death threat just a lyric”. On December 5, the appellant sent an email to Ballingal complaining of some factual inaccuracies in the article, and stating he had never admitted to making death threats, which the title suggested. The appellant then issued a statement of claim on April 28, 2015, alleging that the words “Rapper says death threat just a lyric” in the online version of the article were false and defamatory.

The appellant’s claim was struck on a r. 21 motion because he did not give notice within six weeks of becoming aware of the article, or issue a statement of claim within the three-month limitation period provided for in the Libel and Slander Act (LSA).

The appellant submitted that the online version of the article is not “in a newspaper” because there is no paper, and as such the LSA does not apply. The appellant submitted that the notice and limitation period under the LSA does not start to run until the article is no longer on the internet. He argued that, for every day that the defamatory words are published online, a new and distinct cause of action accrues, and a new limitation period begins to run. Accordingly, his claim was not out ot time and complied with the LSA. Finally, the appellant submitted that the motion judge had incorrectly admitted evidence on the r. 21 motion and that there were findings of fact necessary to be made before the action could be dismissed.

Issues:

(1) Does the LSA apply to the online article?

(2) Was the LSA complied with?

(3) Did the motion judge err in applying r. 21.01(1)(a) to dismiss the claim?

Holding: Appeal dismissed.

Reasoning:

(1) Yes. The court stated that it had considered this same issue in Weiss v Sawyer, and had concluded that a newspaper does not cease to be a newspaper when it is published online. The court found that to hold otherwise would ignore the principles of statutory interpretation, which are flexible enough to achieve the intent of the legislature in the context of evolving realities, and that it would be absurd to provide different regimes for print and online versions of newspapers. The court found that the LSA applied to the digital version of the article published.

(2) No. The court held that the appellant was relying on an incorrect interpretation. The time by which the plaintiff must give notice under s. 5(1) of the LSA and bring his action under s. 6 begins to run when the libel has come to the knowledge of the person defamed. Here, when the appellant wrote an email to the defendants on December  5, he was aware of the facts on which his cause of action might be founded. The court held the limitation clock had begun to run at that time. Therefore, the limitation period expired long before the Statement of Claim was issued sixteen months later.

(3) No. The court found that the record did not support those allegations. Moreover, since the court had found the LSA to apply to the online newspaper article and the claim was out of time, it was plain and obvious that the action could not succeed.

D’Ascenzo v. Nichols, 2017 ONCA 578

[MacPherson, Cronk and Benotto JJ.A.]

Counsel:

M. Boire, for the appellant/respondent by way of cross-appeal

J.F. Laberge and M. Ranaivoson, for the respondents/ appellants by way of cross-appeal

Keywords: Real Property, Contracts, Agreements of Purchase and Sale of Land, Repudiation, Remedies for Breach, Specific Performance, Rescission

In 2006, the respondents sought to purchase from the appellant (a) the appellant’s shares in 1702620 Ontario Inc., (b) the Petting Zoo vacant land, and (c) the Lot 511 vacant land. The share purchase agreement included the terms by which the appellant was to sell the Petting Zoo and Lot 511 to the respondents. However, the appellant did not take the required steps to have Lot 511 severed pursuant to the Planning Act, R.S.O. 1990, c. P.13. No mortgage was ever registered on title to either property.

The share purchase transaction closed on November 24, 2006. Since the closing, as of January 2013, the respondents made payments to the appellant towards the purchase of the Petting Zoo and Lot 511 totalling $168,727. The respondents did not make any further payments after January 2013. After that point, the respondents demanded clear title to the Petting Zoo because they alleged they had paid for it in full, and said they would pay the remaining $27,500, owing for Lot 511, when the appellant cleared up the title issues relating to the severance of that property.

The appellant refused to convey title to the Petting Zoo and informed the respondents that he was “foreclosing” on Lot 511.

The respondents commenced an action and brought a motion for summary judgment, which was granted in part. The motion judge ordered rescission and damages with respect to one of the properties (the Petting Zoo), and issued a certificate of pending litigation with respect to the other property (Lot 511), pending a trial of the issue of specific performance, which involved the issue of the granting of a severance of the two properties.

The appellant sought to overturn the motion judge’s decision on the basis that the respondents defaulted on their debt obligation and therefore forfeited their interest in both properties. In the alternative, the appellant sought to vary the judgment and alleged that the motion judge erred in determining the appropriate remedies for both properties.

Issues:

(1) Did the motion judge err by resolving the issues by way of a summary judgement?

(2) Did the motion judge err by not concluding that the respondents breached the contract by not continuing their monthly payments towards the mortgage?

(3) Did the motion judge err by granting rescission of the agreement to purchase the Petting Zoo?

(4) Did the motion judge err by granting specific performance of the Lot 511 purchase?

Holding: Appeal dismissed.

Reasoning:

(1) No. There was a comprehensive record before the motion judge including all the relevant commercial documents and extensive affidavit evidence and cross-examinations thereon from the parties and their joint lawyer.

(2) No. The reason the respondents stopped making payments in 2013 was that the appellant had taken no steps to obtain the severance of Lot 511.

(3) No. Although ‘rescission’ is probably the wrong legal term (it is evident from the motion judge’s reasons that he meant repudiation), it was clearly open to the motion judge, on the question of remedy, to treat the two properties separately and to determine that the respondents, after spending so much money over many years towards the purchase of the Petting Zoo, were entitled to treat the contract as at an end and to obtain damages as restitution of monies paid.

(4) No. The motion judge did not order specific performance. He found that the respondents’ entitlement to specific performance of Lot 511 was established, except for the crucial issue of severance, which he determined “will have to be established in a trial as to that issue.” Accordingly, he directed that a Certificate of Pending Litigation be registered on title to Lot 511.

Goldentuler Estate v. Crosbie, 2017 ONCA 591

[MacPherson, Cronk and Benotto JJ.A.]

Counsel:

R. Thapar, for the appellant

No one appearing for the defendants

Keywords: Contracts, Lawyers, Breach of Fiduciary Duty, Damages, Punitive Damages

Facts:

The appellant estate appealed from the trial judge’s damages assessment at an undefended trial. The damages trial was undefended because the defendants’ statement of defence and counterclaim were struck by the Superior Court. The defendants’ pleading having been struck by court order, this appeal also proceeded on an undefended basis.

The trial judge found that the defendants were liable to the appellant for damages arising from breaches by them of their duties of loyalty, good faith and avoidance of conflict of interest and self-interest during the course of their employment with Henry Goldentuler, a deceased lawyer (the “Deceased”).  The breaches arose from the defendants’ wrongful removal and transfer to a competing law firm of 120 client files from the Deceased’s law offices. The trial judge awarded the appellant general damages totalling about $345,000 plus pre-judgment interest of about $145,000, and special damages of a little over $26,000. She declined to award punitive damages.

The appellant argued, on various grounds, that the trial judge erred in her quantification of general and special damages, and by refusing to award punitive damages in the circumstances of this case.

Issues:

(1) Did the trial judge err in her quantification of general damages?

(2) Did the trial judge err in her quantification of special damages?

(3) Did the trial judge err by refusing to award punitive damages?

(4) Did the trial judge err in any other respect in calculating damages?

Holding: Appeal allowed, in part.

Reasoning:

(1) Yes. The trial judge’s first error was her reduction, by 44 percent, of the general damages she found were otherwise appropriate to account for overhead expenses notionally attributed to the files wrongfully removed by the defendants.  The agreed arrangement between the parties contemplated that any fees generated on completion or settlement on the disputed files were to be shared on an equal, 50/50 basis between the parties, with the appellant bearing sole responsibility for overhead expenses.

Yet, the trial judge both reduced the general damages otherwise owed to the appellant by 44 percent on account of overhead expenses and further reduced the general damages awarded by an additional 50 percent to reflect the fees-sharing arrangement agreed by the parties. This resulted, in effect, in “double-counting” because the fee-sharing arrangement between the parties already took account of the appellant’s responsibility for overhead expenses.

The court therefore increased the total general damages awarded to a little over $500,000, plus pre-judgment interest.

(2) Yes. The trial judge awarded special damages equal to two-thirds of the disbursements incurred by the Deceased in respect of the disputed files ($26,339.32). The Court of Appeal held that the Deceased was entitled to payment of all disbursements actually incurred by him, i.e., $39,509.29, plus pre-judgment interest, since the disbursements were a real, out-of-pocket expenses incurred by the Deceased, and established on the evidence at trial.

(3) Yes. The trial judge declined to award punitive damages in this case primarily on the ground that the claim for these damages were based on the inordinate delay caused by the defendants in the progress of the litigation.  The Court of Appeal disagreed. The appellant’s punitive damages claim was not solely related to litigation delay caused by the defendants. Rather, it focused on the defendants’ egregious pre-litigation behaviour in effecting the wrongful removal of the relevant client files from the Deceased’s offices, the transfer of those files to a competing law firm, and the persistent failure to return the removed files. Furthermore, the defendants’ conduct was indeed outrageous and high-handed. As a result, it cried out for sanction by the courts. The court therefore awarded $80,000 in punitive damages.

(4) No. The trial judge’s calculation of damages was well within her domain and supported by the governing authorities and evidentiary record, save as set out above.

L’Ouvrier Inc. v. Leung, 2017 ONCA 589

[MacPherson, Cronk and Benotto JJ.A.]

Counsel:

J.G. Hodder and C. Stienburg, for the appellants

D. Barbaree, for the respondents

Keywords: Contracts, Real Property, Commercial Leases, Options to Renew, Civil Procedure, Summary Judgment, Adjournments

Facts:

In 2011, the parties entered into an agreement to lease a unit (used as a restaurant) in a building owned by the appellants (the “Agreement”). It contained an option for renewal that the respondent could exercise so long as it was not in default of the Agreement, and provided written notice of its intention to exercise the option. In addition to the regular rental payments, the respondent was also liable for additional rent to be paid in monthly installments, calculated as the estimated proportionate share of direct costs associated with the occupancy and use of the premises.

In 2013, the appellants demanded a further amount in rent. The respondent took the position that this demand did not comply with the Agreement and refused to pay it. The matter was not resolved.

In September 2015, the respondent sent the appellants’ son a text message essentially indicating that it wanted to exercise its renewal option under the Agreement. The appellants took the position that they would not renew the Agreement due to the respondent’s refusal to pay the additional rent demanded. They did not allege, then or later, that the notice of renewal was deficient or in nonconformity with the Agreement.

The parties tried to negotiate a renewal of the Agreement but negotiations broke down. During this time period, the respondent was also trying to sell its business to a third party.

In early 2016, the respondent commenced an action seeking specific performance, an injunction to prevent the appellants from interfering with its rights under the Agreement, and damages for losses caused by the appellants’ breach of contract. The respondent also moved for an injunction to prevent the appellants from evicting it. The parties agreed to settle the matter, but the appellants failed to honour the settlement. The appellants subsequently locked the doors of the premises, posted a notice of distress, and took over the respondent’s liquor licence. As a result, the respondent’s planned sale of its restaurant business fell through.

The respondent brought a motion for summary judgment seeking damages, including punitive damages. The appellants brought a counterclaim alleging unpaid arrears, damage to the property, and punitive damages. They sought to adjourn the summary judgment motion, but their request was denied.

The motion judge found that the respondent was not in breach of the Agreement, and that the appellants had breached the Agreement and engaged in conduct warranting the imposition of punitive damages.  The motion judge therefore granted summary judgment in favour of the respondent, and dismissed the appellants’ counterclaim.

Issues:

(1) Did the motion judge err by not granting an adjournment because they did not have a lawyer and were not fluent in English?

(2) Did the respondent fail to give proper written notice of its intent to exercise the renewal option?

(3) Did the motion judge err in finding that the respondent was not in default of the Agreement?

(4) Did the motion judge err by failing to address the issue of non-rent default?

(5) Did the motion judge err in granting summary judgment against one of the two appellants, given that he was not properly named as a party?

Holding:

Appeal dismissed.

Reasoning:

(1) No. The appellants had been represented by a lawyer earlier in the proceedings, had filed a notice of intent to act in person, and an interpreter was present and participated in the hearing. The request for an adjournment came 90 minutes into the hearing. In these circumstances, the motion judge’s discretionary decision to refuse an adjournment was reasonable.

(2) No. The respondent’s text message to the appellants’ son led to extensive negotiations between the parties. Accordingly, the appellants, by their conduct, acknowledged receiving notice of the respondent’s desire to renew the lease. Further, the appellants did not advance this complaint at the time of the notice.

(3) No. The motion judge carefully considered this issue and agreed with the respondent’s submission that it was not subject to additional rent in the amounts sought by the appellants. There was no error in his analysis.

(4) No. The appellants did not raise potential non-rent default issues on the summary judgment motion. They were therefore precluded from doing so on appeal.

(5) No. This issue was not raised in the court below. In addition to the fact that the appellants were not permitted to raise on appeal an issue that was not before the motion judge, the appellant fully participated in the proceedings and never requested that he be removed as a named party. Accordingly, the motion judge committed no error in granting summary judgment against him.

Gustafson v. Johnson, 2017 ONCA 581

[Lauwers J.A. (In Chambers)]

Counsel:

M.J. Holervich, for the moving parties

B. Johnson and A. Curle, in person

Keywords:Corporations, Winding Up, Civil Procedure, Appeals, Jurisdiction, Ontario Business Corporations Act, section 255

Facts:

The moving parties sought an order transferring this appeal from the Court of Appeal to the Divisional Court at Thunder Bay. The appeal followed a decision wherein the Superior Court made an order that the corporations at issue be wound up under the OBCA.

Issues:

(1) Is the proper court to hear this appeal the Divisional Court?

Holding:Motion granted.

Reasoning:

(1) Yes. This case is a winding up application under the OBCA. Under s. 255 of the OBCA: “[a]n appeal lies to the Divisional Court from any order made by the court under this Act.”

It was necessary for the application judge to determine who the shareholders were, in order to decide whether the corporations should be wound up. The balance of the order gives directions to determine the liabilities of the corporations and to liquidate assets, which are ancillary to the winding up order. Accordingly, the proper route of appeal is the Divisional Court. The appeal was therefore transferred to the Divisional Court in Thunder Bay.

Civil Endorsements

Mendoza v. Active Tire & Auto Centre Inc., 2017 ONCA 586

[Feldman, Cronk and Miller JJ.A.]

Counsel:

B.V. Hanuka, for the appellants

M.A. Davis and R.D. Davis, for the respondent

Keywords: Costs

Criminal and Ontario Review Board Decisions

Ince (Re), 2017 ONCA 584

[Weiler, Hourigan and Pardu JJ.A.]

Counsel:

E. Dann, for the appellants

R. Young, for the respondent

Keywords: Ontario Review Board, Hybrid Orders

R. v. Dieckmann, 2017 ONCA 575

[Doherty, Rouleau and Pepall JJ.A.]

Counsel:

A.K. Kapoor, S.H. Logan, R.C. Bottomley and M. Quenneville, for the appellants

M. Comiskey and X. Proestos, for the respondent

Keywords: Criminal Law, Fraud, Fine in Lieu of Forfeiture, Issue Estoppel, Canadian Charter of Rights and Freedoms, s. 11(b), Transitional Exceptional Circumstances, R. v. Jordan, 2016 SCC 27, [2016] 1 S.C.R. 631, R. v. Cody, 2017 SCC 31, Evidence, Hearsay, Co-Conspirators’ Exception to Hearsay, Jury Instructions

R. v. Malcolm, 2017 ONCA 577

[Weiler, Hourigan and Pardu JJ.A.]

Counsel:

G. Grill and E. Bingham, for the appellant

J. Streeter, for the respondent

Keywords: Criminal Law, Drug Possession, Controlled Drugs and Substances Act, S.C. 1996, c. 19, s. 4(5), Evidence, Search Warrants, Credibility, Deference, Sentencing, Jurisdiction

R. v. McDonald, 2017 ONCA 568

[MacPherson, Cronk and Watt JJ.A.]

Counsel:

P. Campbell, for the appellant

G. Choi, for the respondent

Keywords: Criminal Law, First Degree Murder, Evidence, Admissibility, Circumstantial Evidence, Expert Evidence, Fresh Evidence, Relevance, Extrinsic Misconduct, Causation, Jury Instructions

R. v. DaCosta, 2017 ONCA 588

[Weiler, Hourigan and Pardu JJ.A.]

Counsel:

M. Dineen, for the appellant

K. Healey, for the respondent

Keywords: Criminal Law, Drug Importation, Evidence, Credibility, Circumstantial Evidence

R. v. Ramta, 2017 ONCA 580

[Laskin, Simmons and Pardu JJ.A.]

Counsel:

K. Heath and D. Derstine, for the appellant

G. MacDonald, for the respondent

Keywords: Criminal Law, Attempted Robbery, Fresh Evidence, Sentencing, Credits, R. v. Ghadban, 2015 ONCA 760, 342 O.A.C. 177, Rehabilitation

ONTARIO COURT OF APPEAL SUMMARIES (JUNE 26 – JUNE 30, 2017)

Good evening.

Following are the summaries for this week’s civil decisions of the Court of Appeal for Ontario.

In Tracy v. Iran (Information and Security), the Court of Appeal upheld Ontario default judgments obtained against the State of Iran, which enforced judgments obtained in the US against Iran under that country’s long-arm jurisdiction statute, the Foreign Sovereign Immunities Act. That Act permits claims to be brought in the US against foreign governments for state terrorist activities occurring outside US soil. The incident in question was the 1983 US marine barracks bombing in Beirut, Lebanon. The Justice for Victims of Terrorism Act, passed by our Parliament in 2012, was found to effectively do away with state immunity as provided for in the State Immunity Act for claims relating to terrorist activities. The Court held that the US court had jurisdiction to grant the judgments (ie. there was a real and substantial connection between the US court and subject matter of the dispute) because the US statute specifically conferred jurisdiction. It will be interesting to see if the Supreme Court hears the case.

There were a couple of condominium law decisions of note. In CIBC Mortgages Inc. v. York Condominium Corporation No. 385, the Court of Appeal emphasized the need to maintain the appropriate balance between the rights of the condominium corporations and mortgagees in respect of the preservation of condo liens. The court rejected the condominium corporation’s interpretation of section 134(5) of the Condominium Act, 1998 which, if accepted, would have essentially allowed the corporation to indefinetly extend the three month time period within which to perfect liens for unpaid maintenance fees and costs payable pursuant to compliance orders. In York Region Standard Condominium Corporation No. 1253 v. Hashemi, the Court of Appeal increased the costs payable to the successful condominium corporation in a condominium dispute. Section 134(5) of the Act was found to provide a greater entitlement to costs than the regular costs regime under Rule 57 of the Rules of Civil Procedure.

Other topics covered include class proceedings, labour law, employment law, family law, adverse possession, agreements of purchase and sale of land, and stays pending appeal.

Wishing everyone a Happy 150th Canada Day and enjoyable long weekend.

John Polyzogopoulos
Blaney McMurtry LLP
jpolyzogopoulos@blaney.com
Tel: 416 593 2953
http://www.blaney.com/lawyers/john-polyzogopoulos

Table of Contents:

Civil Decisions

Heffernan v. Knights of Columbus, 2017 ONCA 534

 Keywords: Contracts, Settlements, Essential Terms

Pepper v. Brooker, 2017 ONCA 532

Keywords: Real Property, Adverse Possession, McClatchie v. Rideau Lakes (Township), 2015 ONCA 233, Trespass

Weenen v. Biadi, 2017 ONCA 533

Keywords: Real Property, Nuisance, Strict Liability, Rylands v. Fletcher [1868] UKHL 1 (H.L.), (1868) L.R. 3 H.L. 330, Negligence, General Damages, Punitive Damages

Patel v. Harriott, 2017 ONCA 538

Keywords: Contracts, Agreements of Purchase and Sale of Land, Specific Performance

Cora Franchise Group Inc. v. Watters, 2017 ONCA 35

Keywords: Civil Procedure, Stay Pending Appeal, Supreme Court Act, R.S.C. 1985, c. S-26, s 65.1,  Iroquois Falls Power Corp. v Ontario Electricity Financial Corp., 2016 ONCA 616, Contracts, Guarantees, Franchise Law, Franchise Agreements

Nagribianko v. Select Wine Merchants Ltd., 2017 ONCA 540

Keywords: Employment Law, Wrongful Dismissal, Probationary Period, Mison v. Bank of Nova Scotia (1994), 6 C.C.E.L. (2d) 146 (Ont. Ct. (Gen. Div.)), Machtinger v. HOJ Industries Ltd., [1992] 1 S.C.R. 986, Employment Standards Act, 2000, S.O. 2000, c. 41, Contracts, Interpretation, Salah v. Timothy’s Coffees of the World Inc., 2010 ONCA 673, 2010 O.A.C. 279

Tisi v. St. Amand, 2017 ONCA 539

Keywords: Civil Procedure, Stay Pending Appeal, RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311, Certificates of Pending Litigation, Contracts, Agreements of Purchase and Sale of Land, Specific Performance, Uniqueness

Velgakis v. Servings, 2017 ONCA 541

Keywords: Civil Procedure, Summary Judgment, Limitation Periods, Discoverability, Appropriateness of Proceedings, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, 407 ETR Concession Company Limited v. Day, 403 D.L.R. (4th) 485, Presidential MSH Corporation v. Marr Foster & Co. LL, 2017 ONCA 325

CIBC Mortgages Inc. v. York Condominium Corporation No. 385, 2017 ONCA 542

Keywords: Real Property, Condominiums, Compliance Orders, Common Expenses, Liens, Preservation, Condominium Act, 1998, S.O. 1998, c. 19, ss 85, 86, 134, Metropolitan Toronto Condominium Corp. No. 1385 v. Skyline Executive Properties Inc., [2005] 253 D.L.R. (4th) 656, Toronto Standard Condominium Corporation No. 1908 v. Stefco Plumbing & Mechanical Contracting Inc., 2014 ONCA 696, 377 D.L.R. (4th) 369

Barber v. Magee, 2017 ONCA 558

Keywords: Family Law, Presumption of Advancement, Gifts, Presumption of Resulting Trust, Pre-Judgment Interest

New Solutions Financial Corporation (Re), 2017 ONCA 553

Keywords: Bankruptcy and Insolvency, Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36, Leave to Appeal

Paradigm Quest Inc. v. McInroy, 2017 ONCA 547

Keywords: Civil Procedure, Appeals, Interlocutory or Final Orders, Jurisdiction

Ravenda Homes Ltd. v. 1372708 Ontario Inc., 2017 ONCA 556

Keywords: Civil Procedure, Appeals, Security for Costs

Total Mechanical Systems Limited v. Sheet Metal Workers’ International Association, Local 30, 2017 ONCA 559

Keywords: Labour Law, Collective Agreements, Voluntary Recognition Agreements, Bhaduria v. Toronto Board of Education, [1999] 173 D.L.R. (4th) 382 (Ont. C.A.), Civil Procedure, Striking Pleadings, No Reasonable Cause of Action, Abuse of Process, Rules of Civil Procedure, Rule 21

Yormak v. Arvai, 2017 ONCA 550

Keywords: Contracts, Solicitor and Client, Referral Fees, Rules of Professional Conduct, r. 2.08(7)

Amyotrophic Lateral Sclerosis Society of Essex County v. Windsor (City), 2017 ONCA 555

Keywords: Civil Procedure, Class Proceedings, Appeals, Motions to Quash, Jurisdiction, Interlocutory or Final Orders, Pleadings, Amendments

Bakshi v. Global Credit & Collection Inc., 2017 ONCA 0548

Keywords: Contracts, Employment Law, Class Proceedings, Summary Judgment

Tracy v. Iran (Information and Security), 2017 ONCA 549 

Keywords: Private International Law, Conflict of Laws, Enforcement of Foreign Judgments, Jurisdiction, Real and Substantial Connection, Beals v. Saldanha, 2003 SCC 72, [2003] 3 SCR 416, State Immunity, Justice for Victims of Terrorism Act, S.C. 2012, c. 1, s 4(5), State Immunity Act, R.S.C 1985, c. S-18, s. 6.1(2), 12

Vanier v. Vanier, 2017 ONCA 561

Keywords: Wills and Estates, Powers of Attorney for Property, Substitute Decisions Act, 1992, S.O. 1992, c. 30, New Issues on Appeal, Undue Influence,  Kaiman v. Graham, 2009 ONCA 77

York Region Standard Condominium Corporation No. 1253 v. Hashemi, 2017 ONCA 557

Keywords: Real Property, Condominiums, Damages, Mitigation, Full Indemnity Costs, Condominium Act, 1998, S.O. 1998, c.19, s. 134(5), Rules of Civil Procedure, r. 57, Metropolitan Toronto Condominium Corp. No. 1385 v. Skyline Executive Properties Inc. (2005), 253 D.L.R. (4th) 656 (Ont. C.A), Boucher v. Public Accountants Council (Ontario) (2004),71 O.R. (3d) 291 (C.A.)

For Civil Endorsements, click here 

For Criminal Decisions, click here

For Ontario Review Board Appeals, click here 

Civil Decisions

Heffernan v. Knights of Columbus, 2017 ONCA 534

[Epstein, Hourigan and Paciocco JJ.A.]

Counsel:

P. Morgan, for the appellant

J. Lefebvre, for the respondents

Keywords: Contracts, Settlements, Essential Terms

Facts:

The appellant sued the Ontario respondents and two related American parties as a consequence of his suspension from a charitable fraternal benefits organization. The parties then engaged in settlement discussions. The motion judge found that the appellant and the respondent entered into a binding agreement to resolve the litigation. However, the appellant claimed there was only an agreement in principle and that the parties did not finalize said agreement by the agreed upon deadline.

As such, the appellant is appealing the motion judge’s decision.

Issues:

(1) Did the motion judge err in finding that the parties entered into a binding agreement to resolve the litigation?

Holding: Appeal dismissed.

Reasoning:

(1) No. There was ample evidence supporting a conclusion that the parties had reached a settlement agreement. The parties agreed upon the agreement’s essential particulars, and the Ontario respondents provided settlement monies to their lawyer. Furthermore, the form of the release that the appellant’s counsel requested to be included in any agreement had already been executed by some of the Ontario respondents before the appellant purported to terminate the agreement.

There was no deadline for completion of the terms of the settlement in any of the settlement documents, or the correspondence among counsel. The appellant could have insisted on its inclusion in the terms of the agreement. However, the appellant did not do this. Accordingly, there was no basis for the appellant to resile from the agreement based on a failure to meet this artificial deadline.

Pepper v. Brooker, 2017 ONCA 532

[Epstein, Benotto and Trotter JJ.A.]

Counsel:

B. Yellin, for the appellant

P. Quinlan, for the respondent 

Keywords: Real Property, Adverse Possession, McClatchie v. Rideau Lakes (Township), 2015 ONCA 233, Trespass

Facts:

This appeal arises from a boundary dispute between two cottage owners. The appellant sued the respondents for trespass because he believed that they had built part of a road on his property. The respondents then claimed title under adverse possession. Both actions were tried together. The appellant’s claim was dismissed, and the respondents succeeded in obtaining title to roughly 3,400 square feet of the appellant’s property.

The appellant now appeals on the basis that the claim for adverse possession ought to have failed because the respondents did not prove that they had excluded him from the disputed lands. Furthermore, the appellant argues that the trial judge erred in dismissing his action and that costs should not have been awarded on a substantial indemnity basis.

The trial judge found that both the appellant and respondents were mutually mistaken about the location of the property line. In his reasons, the trial judge relied heavily on the court in Teis v. Ancaster (Town), 1997 35 OR (3d) 216 (CA) to conclude that the mutual mistake meant that the respondents intended to occupy part of the appellant’s property and to exclude the appellant from it.

Issues:

(1) Did the respondents establish that they effectively excluded the appellant from the disputed lands?

(2) Did the trial judge err in dismissing the appellant’s claim in trespass?

(3) Did the trial judge err in awarding costs on a substantial indemnity basis?

Holding: Appeal allowed.

Reasoning:

(1) No. The elements of adverse possession were stated in McClatchie v. Rideau Lakes (Township), 2015 ONCA 233, 333 OAC 381, and are as follows:

a) actual possession of the lands in question,
b) an intention of excluding the true owner from possession, and
c) effectively excluding the true owner from possession.

While the trial judge found that the respondents had intended to exclude the appellant, he did not find that they effectively excluded him. In this case, the evidence suggested that the respondents did not effectively exclude the appellant from the disputed part of his property. No one, including the appellant, was prevented from using the disputed lands, and this ought to have led the trial judge to conclude that the respondents failed to establish an intention to exclude.

Even if an intention to exclude was found, the respondents would have still failed in achieving an effective exclusion from the property, which is necessary if an adverse possession claim is to succeed. This is true even when the case is one of mutual mistake, as found by the court in Shennan v. Szewczyk, 2010 ONCA 679, 96 RPR (4th) 190.

Therefore, without a finding of effective exclusion, it was an error of law for the trial judge to allow the respondent’s adverse possession claim.

(2) Yes. The trial judge dismissed the trespass action because of his findings on the adverse possession claim. In light of the above conclusion on how the trial judge’s adverse possession ruling was an error in law, his findings on trespass cannot stand. However, there was no basis to interfere with the trial judge’s conclusion that the appellant had suffered no damages as a result of any trespass and the appellant abandoned his claim to damages in any event. Accordingly, no damages for trespass were awarded.

(3) Yes. Since the appellant was successful on the appeal, the trial judge’s cost award against the appellant must be set aside. Instead, the appellant is to be awarded costs of the proceeding below and the appeal.


Weenen v. Biadi, 2017 ONCA 533

[Epstein, Hourigan and Paciocco JJ.A.]

Counsel:

J. Montgomery, for the appellant

J. Lefebvre, for the respondents

Keywords: Real Property, Nuisance, Strict Liability, Rylands v. Fletcher [1868] UKHL 1 (H.L.), (1868) L.R. 3 H.L. 330, Negligence, General Damages, Punitive Damages

Facts:

The appellant and the respondent own neighbouring rural properties. Shortly after buying his property, the appellant began adding fill to his property, in order to permit it to be used for farming. The respondent claimed that the appellant’s actions caused flooding on his land and brought this action for damages based on negligence, nuisance, and under the strict liability doctrine of Rylands v. Fletcher [1868] UKHL 1 (H.L.), (1868) L.R. 3 H.L. 330.

The trial judge held the appellant liable to the respondent for damages based on negligence, nuisance, and under the strict liability doctrine of Rylands v. Fletcher. In addition to making mandatory orders regarding the appellant’s property, the trial judge ordered the appellant to pay the respondent damages totaling $390,000.

The appellant challenges only the trial judge’s assessment of general damages ($250,000) and punitive damages ($125,000). The appellant argues that the award of general damages is out of proportion to the magnitude of the harm, and with the range of awards in other cases as to be “palpably incorrect”. The appellant submits that the findings that informed the trial judge’s decision to award punitive damages were not supported by the evidence. The appellant further contends that his conduct does not meet the test for punitive damages. Finally, even if warranted, the award of punitive damages is so far out of any reasonable range that it calls for appellate intervention.

Issues:

(1) Did the trial judge err in his assessment of general damages?

(2) Did the trial judge err in his assessment of punitive damages?

Holding: Appeal dismissed.

Reasoning:

(1) No. In considering the claim for general damages, the trial judge found that the appellant’s conduct had caused the respondent “significant and prolonged harm including distress, frustration, anxiety, and loss of the reasonable use and enjoyment of his home for over 12 years”. The Court of Appeal did not interfere with general damages because the appellant did not challenge the trial judge’s findings.

(2) No. The trial record shows the appellant to have, for over a decade, repeatedly taken steps designed to increase the value of his property knowing the harm these steps were causing to the respondent’s property and to the respondent, personally. The appellant’s conduct could be described as “high-handed, malicious, arbitrary, and highly reprehensible that departs to a marked degree from the ordinary standards of decent behavior”. In the circumstances of this case, particularly given the length of time that the appellant conducted himself in this fashion, an award that addresses the issue of deterrence was clearly warranted.


Patel v. Harriott, 2017 ONCA 538

[Hoy A.C.J.O., van Rensburg and Roberts JJ.A.]

Counsel:

L. Robinson, for the appellants

T. Courtis, for the respondents

Keywords: Contracts, Agreements of Purchase and Sale of Land, Specific Performance

Facts:

The application judge determined that there was a binding agreement for the purchase and sale of the appellants’ Brampton home and ordered specific performance of the agreement.

Issues:

(1) Did the application judge err in concluding it was appropriate for this matter to be heard by way of application?

(2) Did the application judge err in finding there was a binding agreement?

(3) Did the application judge err in finding that the appellants’ acceptance of the respondents’ offer amounted to a counter-offer?

Holding: Appeal dismissed.

Reasoning:

(1) No. The Court held the application judge was correct in finding that although there was a dispute about when the appellants had accepted the respondents’ offer, that dispute did not affect his ability to determine the application.

(2) No. The Court held the application judge was correct in finding that whether or not the appellants accepted the respondents’ offer after the time of expiry, the appellants had expressly signified they were prepared to enter into an agreement to sell their home by signing and returning the respondents’ offer. Moreover, the Court found the appellants had proceeded with a manner consistent with a binding agreement having been concluded.

(3) No.


Cora Franchise Group Inc. v. Watters, 2017 ONCA 35

[Brown J.A. (In Chambers)]

Counsel:

M. Kropp, for the moving party

D. Ronde and A. Murphy, for the responding party

Keywords: Civil Procedure, Stay Pending Appeal, Supreme Court Act, R.S.C. 1985, c. S-26, s 65.1,  Iroquois Falls Power Corp. v Ontario Electricity Financial Corp., 2016 ONCA 616, Contracts, Guarantees, Franchise Law, Franchise Agreements

Facts:

The moving party, William Watters, sought leave to appeal an order of the Ontario Court of Appeal to the Supreme Court of Canada. He moved under s. 65.1 of the Supreme Court Act, R.S.C. 1985, c. S-26 for an order staying the judgment of the motion judge and the order of the Court of Appeal pending the determination of his application for leave to appeal to the Supreme Court.

The action arose out of a personal guarantee given by the moving party with respect to a franchise agreement involving the responding party. The moving party was a director and shareholder of a numbered company that operated a restaurant franchise under a franchise agreement with the responding party, The Cora Franchise Group Inc (“Cora”). The moving party gave a personal guarantee of the franchisee’s indebtedness to Cora.

The responding party sued the moving party on the guarantee, seeking payment of royalty fees, advertising contributions, and products and supplies owed by the franchisee. By way of defence, the moving party pleaded set-off because the responding party allegedly caused the loss of a potential sale of the franchise in 2013.

The responding party was successful on a motion for summary judgment on the guarantee and the moving party subsequently had his appeal to the Ontario Court of Appeal dismissed.

Issues:

(1) Is the moving party entitled to a stay pending an application for leave to appeal to the Supreme Court of Canada?

Holding: Motion dismissed.

Reasoning:

(1) No. The test for granting a stay pending an application for leave to appeal to the Supreme Court of Canada is well-established. The moving party must demonstrate that:

(i) there is a serious issue to be adjudicated on its proposed appeal, including that the appeal raises an issue of public or national importance;
(ii) it will suffer irreparable harm if the stay is not granted; and
(iii) the balance of convenience favours granting the stay.

There is no serious issue to be adjudicated on the proposed appeal. The moving party wants to argue three issues at the Supreme Court of Canada. Two of them are to do with whether his counterclaim was statute-barred, which is a largely fact-driven analysis under the Limitations Act, 2002, S.O. 2002, c. 24, Sch B. The final issue involves the interpretation and interplay of the guarantee and franchise agreement, and the effect of the respondent’s conduct in respect to the potential sale of the franchise in 2013. The motion judge described the moving party’s set-off defence as without merit, and the Ontario Court of Appeal agreed with the motion judge.

The moving party will not suffer irreparable harm if the stay is not granted. Only money is at stake for the moving party if the stay is not granted, and this generally does not constitute irreparable harm. Any assets that the moving party would need to use in order to satisfy the judgments ought to have been a foreseeable business risk when he signed up to be a personal guarantor.

The balance of convenience does not favour the moving party. The moving party, at the start of the litigation, admitted the debt owed to the respondent. The moving party even admitted that the franchisee made a deliberate decision to pay debt to other creditors over the responding party.

Accordingly, the moving party’s motion for a stay pending leave to appeal to the Supreme Court of Canada was dismissed.

Nagribianko v. Select Wine Merchants Ltd., 2017 ONCA 540

[LaForme, Hourigan and Paciocco JJ.A.]

Counsel:

 H. Markowitz, for the appellant

G. MacKenzie and B. MacKenzie, for the respondent

Keywords: Employment Law, Wrongful Dismissal, Probationary Period, Mison v. Bank of Nova Scotia (1994), 6 C.C.E.L. (2d) 146 (Ont. Ct. (Gen. Div.)), Machtinger v. HOJ Industries Ltd., [1992] 1 S.C.R. 986, Employment Standards Act, 2000, S.O. 2000, c. 41, Contracts, Interpretation, Salah v. Timothy’s Coffees of the World Inc., 2010 ONCA 673, 2010 O.A.C. 279

Facts:

The appellant appealed the decision of the Divisional Court, which had reversed the decision of a Small Claims Court judge who had held that the respondent had wrongfully terminated the appellant shortly before he had completed six months of work for the respondent.

The respondent agreed that it did not have just cause to terminate the appellant. The respondent’s position was that it terminated the appellant as a probationary employee, having judged in good faith that the appellant was unsuitable for the job.

In finding that the termination was wrongful in the absence of just cause, the trial judge held that the respondent was not entitled to rely on the clause in the employment contract stating, “Probation…… Six months”. The trial judge found that the probationary terms had not been spelled out as a result of the failure of the respondent to deliver a copy of the Employee Handbook that contained the terms the respondent intended to include.

The trial judge found that the appellant understood the term “probation” to mean no more than that he would be kept on as an employee if he performed well, and that he would not have taken the job had he known that he could be terminated without just cause and with only one week’s pay in lieu of notice. The trial judge awarded the appellant damages equivalent to four months of salary and benefits in lieu of notice.

Issues:Did the trial judge err in failing to give effect to the probationary term of the contract?

(1) Did the trial judge err in failing to give effect to the probationary term of the contract?

(2) Did the trial judge err by interpreting the term “Probation…… Six months” according to the subjective understanding of the appellant?

Holding: Appeal dismissed.

Reasoning:

(1) Yes. The trial judge’s decision to treat the term “Probation…… Six months” as having no meaning was wrong. The parties agreed to a probationary contract of employment, and the term “probation” was not ambiguous. The status of a probationary employee has acquired a clear meaning at common law. Unless the employment contract specifies otherwise, probationary status enables an employee to be terminated without notice during the probationary period if the employer makes a good faith determination that the employee is unsuitable for permanent employment, and provided the probationary employee was given a fair and reasonable opportunity to demonstrate their suitability: Mison v. Bank of Nova Scotia (1994), 6 C.C.E.L. (2d) 146 (Ont. Ct. (Gen. Div.)), at para. 43.

It is true that there is a presumption that an indefinite employment contract is terminable only on reasonable notice, however that presumption is overcome if the parties agree to a probationary period of employment: Machtinger v. HOJ Industries Ltd., [1992] 1 S.C.R. 986, at p. 999; Since it is not possible to contract out of the minimum notice standards provided for in the Employment Standards Act, 2000, S.O. 2000, c. 41 (the “ESA”), probationary employees are entitled to receive statutory notice, or pay in lieu of that notice. In this case, the required period of notice is one week, which the appellant received. Furthermore, the Court of Appeal noted that there was nothing in the appellant’s employment contract purporting to oust the statutory notice requirements under the ESA.

(2) Yes. The Court of Appeal held that the Divisional Court was also correct in finding that the trial judge erred by interpreting the term “Probation…… Six months” according to the subjective understanding of the appellant, when contractual terms are to be interpreted based on an objective assessment of the intention of the parties: Salah v. Timothy’s Coffees of the World Inc., 2010 ONCA 673, 2010 O.A.C. 279, at para 16.

Accordingly, the appeal was dismissed.

Tisi v. St. Amand, 2017 ONCA 539

[Brown J.A. (In Chambers)]

Counsel:

D. Schmuck, for the moving party

D. Macfarlane, for the responding party 

Keywords: Civil Procedure, Stay Pending Appeal, RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311, Certificates of Pending Litigation, Contracts, Agreements of Purchase and Sale of Land, Specific Performance, Uniqueness

Facts:

The parties entered into an Agreement of Purchase and Sale (the “Agreement”) for the purchase of a residential house by the appellant from the respondent. The parties disputed the validity and enforceability of the agreement and subsequently commenced applications as a result of their dispute. The applicant sought specific performance of the Agreement, with a claim for damages in lieu. The respondent sought a declaration the Agreement was null and void, together with an injunction prohibiting the appellant from encumbering title to the property. The appellant obtained and registered a certificate of pending litigation (“CPL”) against the property prior to the hearing of the applications.

The application judge found the parties were not ad idem on the essential elements of the contract and declared that they did not enter into a valid agreement of purchase and sale. She ordered the respondent to return the $10,000 deposit to the appellant. The application judge also ordered the appellant to discharge the certificate of pending litigation (“CPL”) she registered against the property, which the appellant did not do. Instead, the appellant filed a notice of appeal. She then moved for a stay pending appeal of para. 3 of the Judgment directing her to discharge the CPL.

Issues:

(1) Should there be a stay of proceedings?

Holding: Motion granted.

Reasoning:

(1) Yes. The over-arching principle established in RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311 is that a court must decide whether the interests of justice call for a stay. The moving party must demonstrate that:

(i) there is a serious issue to be adjudicated on its proposed appeal;
(ii) it will suffer irreparable harm if the stay is not granted, and
(iii) the balance of convenience favours granting the stay.

Serious Question on Appeal

Although the grounds of appeal advanced by the appellant in her notice of appeal largely concerned questions of fact or mixed fact and law, the Court was satisfied that she met the low threshold for establishing a serious question for appeal.

Irreparable Harm

Generally, demonstrating irreparable harm requires the moving party to establish she will suffer a loss not quantifiable in monetary terms. The appellant sought specific performance of the Agreement or, in the alternative, damages in lieu thereof. Specific performance should not be granted as a matter of course absent evidence that the property is unique to the extent that its substitute would not be readily available. The house at issue was a custom-built one, making it unique. This satisfied this part of the test.

Balance of Convenience

The balance of convenience branch of the test requires a court to consider and balance the respective harm to each party from the grant or refusal of a stay.

The appellant filed evidence that the respondent was “wrapping things up” in Welland and moving further north in Ontario. She also filed the results of some title searches that disclose that the respondent sold three properties in the Niagara area during May 2017. This evidence may well support an inference that the respondent is wrapping up his business in the Niagara area, but it does not suggest he lacks assets in Ontario.

There was a lack of evidence about what prejudice, if any, the continued registration of the CPL caused the respondent. The respondent argued that the CPL placed an unfair burden on him by preventing the sale of the house and “accounting to his mortgagee and other creditors.” While it was likely that the house would remain unsold as long as a CPL was registered against title, the respondent did not file any evidence about the current state of affairs regarding the house or the effect of the CPL on his business.

Accordingly, the appellant’s motion for a stay pending appeal was granted.

Velgakis v. Servinis, 2017 ONCA 541

[LaForme, Hourigan and Paciocco JJ.A.]

Counsel:

M. Gibbs, for the appellants

B. Day, for the respondent

Keywords: Civil Procedure, Summary Judgment, Limitation Periods, Discoverability, Appropriateness of Proceedings, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, 407 ETR Concession Company Limited v. Day, 403 D.L.R. (4th) 485, Presidential MSH Corporation v. Marr Foster & Co. LL, 2017 ONCA 325

Facts:

The respondent felt his lower denture work was improperly done and needed to be fixed. He commenced an action in Small Claims Court for $25,000. The appellants filed a defence and issued a third party claim. The respondent then commenced this action for $100,000 for general damages and $50,000 for special damages in the Superior Court against the same parties, with the addition of one defendant.

The respondent moved to transfer the action from the Small Claims Court and/or consolidate the actions in the Superior Court. The appellants’ motion for summary judgment on the basis the action was time-barred was dismissed. The appellants argued that the motion judge misinterpreted and misapplied the law relating to discoverability.

Issues:

(1) Did the motion judge err in concluding that the respondent’s action was not time-barred?

Holding: Appeal dismissed.

Reasoning:

(1) No. Under s. 5 (1)(a) of the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B (the “Act”), a claim is discovered on the date the claimant knew, or ought to have known, the material facts giving rise to the claim, and that a proceeding would be an “appropriate” means to seek to remedy the claim. When an action is “appropriate” depends on the specific factual setting of each individual case: 407 ETR Concession Company Limited v. Day, 403 D.L.R. (4th) 485, at paras. 33-34.

Deciding whether legal action would be “appropriate” takes into account what a reasonable person with the abilities and in the circumstances of the plaintiff ought to have known — a modified objective test: Presidential MSH Corporation v. Marr Foster & Co. LLP, 2017 ONCA 325, at para. 18.

The Court of Appeal held that the motion judge correctly applied the modified objective test when it made three critical findings:

(i) It was appropriate for the respondent to make reasonable efforts to have his complaints regarding his dentures resolved on a consensual basis without quickly resorting to potential litigation.
(ii) It was appropriate for the respondent to rely on the appellants’ agreement — indicating that repairs may be made at no additional fee — and pursue a consensual resolution of his complaints.
(iii) The first day on which a reasonable person in the respondent’s circumstances ought to have known that a proceeding would be an appropriate means to seek to remedy this claim was the date the respondent’s request to have his dentures repaired at no cost to him had been refused by the appellants.

The motion judge ultimately concluded the date of refusal by the appellants meant that the limitation period did not begin to run until then. The Court of Appeal found that the findings of the motion judge were amply supported by the evidence and were entirely reasonable.

Accordingly, the appeal was dismissed.

CIBC Mortgages Inc. v. York Condominium Corporation No. 385, 2017 ONCA 542

[Strathy C.J.O., Cronk and Pepall JJ.A.]

Counsel:

J. Fine and M. Dimakas, for the appellant

B. Frydenberg, for the respondents 

Keywords: Real Property, Condominiums, Compliance Orders, Common Expenses, Liens, Preservation, Condominium Act, 1998, S.O. 1998, c. 19, ss 85, 86, 134, Metropolitan Toronto Condominium Corp. No. 1385 v. Skyline Executive Properties Inc., [2005] 253 D.L.R. (4th) 656, Toronto Standard Condominium Corporation No. 1908 v. Stefco Plumbing & Mechanical Contracting Inc., 2014 ONCA 696, 377 D.L.R. (4th) 369

Facts:

The parties’ primary dispute was whether the appellant’s statutory lien under s. 85(1) of the Condominium Act, 1998, S.O. 1998, c. 19 (the “Act”) against a particular unit in the condominium (the “Unit”) regarding unpaid common expenses owing under s. 134(5) of the Act, lost priority over the respondent’s first mortgage on the property because the appellant allegedly failed to register a lien certificate on time.

The Unit’s owners granted a mortgage on the Unit to the respondent in January 2010. The appellant obtained a compliance order against one of the Unit’s owners in February 2011. The order included a costs order, which the Unit owner did not pay. The appellant added these outstanding costs to the owner’s existing outstanding costs. The appellant demanded payment from the owner in August 2011, which the owner did not pay. The appellant registered a certificate of lien in November 2011 and registered it in December 2011. The appellant commenced litigation seeking possession of the Unit against the Unit’s owners in February 2013.

The appellant obtained possession of the Unit in November 2013. The Unit’s owners defaulted on their mortgage in December 2013. The respondent commenced enforcement proceedings on the defaulted mortgage in May 2014. The Unit was sold in May 2014. The respondent and appellant agreed that the proceeds of the sale would be held in trust pending determination of entitlement to proceeds.

The appellant maintained that its statutory lien had priority over the respondent’s first mortgage by reason of s. 85(1) of the Act, which reads:

If an owner defaults in the obligation to contribute to the common expenses, the corporation has a lien against the owner’s unit and its appurtenant common interest for the unpaid amount together with all interest owing and all reasonable legal costs and reasonable expenses incurred by the corporation in connection with the collection or attempted collection of the unpaid amount.

Section 85(2) of the Act addresses the perfection of a lien arising under s. 85(1). It says:

The lien expires three months after the default that gave rise to the lien occurred unless the corporation within that time registers a certificate of lien in a form prescribed by the Minister.

Both parties applied for relief in the Superior Court of Justice. On its application, the appellant sought, among other things, declarations that its lien was “good and valid” and that the respondent was not entitled to any part of the Unit’s sale proceeds. The respondent also claimed declaratory relief, including declarations that the appellant’s lien was invalid and ought to be discharged and that the appellant’s lien rights, if any, expired prior to registration of its lien certificate in December 2011. The respondent also sought an order requiring that the net sale proceeds, and certain other funds that it claimed had been wrongly deducted by the appellant’s lawyers from the sale proceeds, be paid to it.

The application judge held that the respondent’s lien expired prior to the registration of its lien certificate. In his view, the Unit’s owner defaulted for the purpose of s. 85(2) of the Act on March 17, 2011, when the owner failed to comply with the Costs Order by March 16, 2011, as required. This default, he held, triggered the three-month perfection period under s. 85(2) of the Act. As the three-month period had run its course prior to the appellant’s registration of its lien certificate on December 12, 2011, its lien lost its priority status, otherwise conferred by s. 86(1) of the Act, over the respondent’s first mortgage.

The application judge dismissed the appellant’s application and granted declarations that its certificate of lien was invalid and that its lien rights had expired prior to the registration of its lien certificate. He ordered that the appellant’s lien certificate be discharged and that the funds held in trust by the appellant’s lawyers from the Unit’s sale, together with certain other funds described below, be paid to the respondent.

The appellant appealed the application judge’s decision. It claimed that the application judge erred in his interpretation of s. 134(5) of the Act, leading him to further err in his determination of the commencement date for the three-month lien perfection period provided for under s. 85(2) of the Act. The appellant also sought leave to appeal from the application judge’s costs ruling.

Section 134(5) of the Act provides for the recovery by a condominium corporation, as common expenses, of damages or costs awarded under a compliance order, plus any “additional actual costs to the corporation in obtaining the [compliance] order”. The common expenses aggregated under s. 134(5) can trigger a s. 85(1) lien claim. It states:

If a corporation obtains an award of damages or costs in an order made against an owner or occupier of a unit, the damages or costs, together with any additional actual costs to the corporation in obtaining the order, shall be added to the common expenses for the unit and the corporation may specify a time for payment by the owner of the unit.

Issues:

(1) Did the appellant preserve the priority assigned to its statutory lien by s. 86(1) of the Act?

Holding: Appeal dismissed.

Reasoning:

(1) No. The Act does not seek to prefer the rights of a condominium corporation at the expense of the rights of an affected mortgagee. The purpose of the common expense provisions of the Act generally, and s. 134(5) specifically, is to provide a remedial mechanism for a condominium corporation to recover the damages or costs awarded in its favour under a compliance order, together with any Additional Actual Costs, directly from the unit owner whose conduct precipitated the compliance proceeding. However, this statutory objective must be achieved in a manner that balances the interests of all stakeholders, including those of non-defaulting unit owners and affected mortgagees.

Section 85(2) of the Act is concerned with the perfection of a statutory lien arising under s. 85(1). In order to preserve the priority of a s. 85(1) lien, s. 85(2) requires that a lien claimant must register a certificate of lien in prescribed form within three months after the unit owner’s default that gave rise to the lien.

Default occurs when the payment is due but not made. In this case, default occurred for the purpose of s. 85(2) of the Act when payment was due under the Costs Order by March 16, 2011, and not made by March 17, 2011. The appellant did not register a certificate of its lien on title to the Unit until December 12, 2011, which is more than three months after the initial default. The appellant registered its lien too late.

Section 134(5) of the Act does not permit a condominium corporation to specify a time for payment of common expenses. This would effectively enlarge the lien perfection period after a default in payment has already occurred. Moreover, it would result in the condominium corporation having the unilateral ability to alter the deadline for perfecting its lien for a potentially unlimited amount of time.

Barber v. Magee, 2017 ONCA 558

[LaForme, Hourigan and Paciocco JJ.A.]

Counsel:

J. Bruggeman, for the appellant

M. Stangarone and S. Lein, for the respondent

Keywords: Family Law, Presumption of Advancement, Gifts, Presumption of Resulting Trust, Pre-Judgment Interest

Facts:

The appellant and the respondent agreed that the appellant’s father advanced $90,414 and then $67,000 to the appellant, all of which was invested in the matrimonial home held in the appellant’s name. If these advancements were loans, they are debts owed by the appellant, reducing his net family property. If they were gifts, they are included in the appellant’s net family property. The appellant appeals the decision of the trial judge that these advancements were gifts.

Issues:

(1) Did the trial judge reverse the onus of proof and ignore the presumption of resulting trust?

(2) Did the trial judge err in finding that the advancements were gifts on the evidence before him?

(3) Did the trial judge err in awarding prejudgment interest during the period when the respondent occupied the home?

Holding: Appeal dismissed.

Reasoning:

(1) No. The court found the trial judge had correctly stated the law of resulting trusts and had applied it correctly. The court found that the trial judge looked at the presence or absence of objective criteria that could help him characterize the payments. In doing so, he was not reversing the onus; the absence of indicia of a loan that one would reasonably expect to find suggested that the advancement was not a loan but a gift. The court held there was no error in the trial judge reasoning in this way.

(2) No. The court held the trial judge was entitled to accept the respondent’s explanation for comments attributed to her, and her testimony, and to reject the evidence of the appellant and his father.

(3) No. The court held that prejudgment interest is “calculated from the date the cause of action arose,” which in this case was the date of separation.

New Solutions Financial Corporation (Re), 2017 ONCA 553

[Sharpe, Lauwers and Miller JJ.A.]

Counsel:

C. Francis, for the appellants

N. Rabinovitch, for the respondents

Keywords: Bankruptcy and Insolvency, Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36, Leave to Appeal

Facts:

The responding parties, New Solutions Financial Corporation, New Solutions Financial (II) Corporation, New Solutions, New Solutions (III) Corporation, New Solutions (IV) Corporation and 2055596 Ontario Limited, sought and obtained protection under the Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36 (“CCAA”). Their assets had been monetized and there was no intention to proceed with a restructuring plan.

The main remaining asset was a claim for professional negligence against the appellants, Feldstein & Associates LLP, and Warren Feldstein (“Feldstein”), the principal applicant’s former auditor.

Feldstein sought leave to appeal the order of the CCAA judge, which had ordered the following:

i. extending the stay period from March 30, 2017 to June 30, 2017;
ii. approving the Monitor’s 23rd report;
iii. declaring the litigation trustee, appointed by the court to pursue the litigation against the moving parties, is not in a conflict of interest; and
iv. staying the litigation against Feldstein until June 30, 2017.

Feldstein raises a number of proposed grounds of appeal:

1. that the pursuit of a lawsuit by an insolvent company on behalf of its
secured creditors does not fall within the purpose and scheme of the
CCAA;

2. that the CCAA judge ignored evidence of bad faith by the responding
parties and others involved in the proceeding;3. that it was inappropriate to make a declaratory order with respect to the

3. that it was inappropriate to make a declaratory order with respect to the
role of the litigation trustee.

Issues:

(1) Should leave to appeal the order of the CCAA judge be granted?

Holding: Appeal dismissed.

Reasoning:

(1) No. The Court of Appeal stated that the proposed appeal failed to meet the test for leave to appeal and leave to appeal must be denied. The Court stated that it is well-established that leave is granted sparingly in CCAA proceedings. The considerations on a leave application are whether:

i. The proposed appeal is prima facie meritorious or frivolous;
ii. The points on the proposed appeal are of significance to the practice;
iii. The points on the proposed appeal are of significance to the action; and
iv. The proposed appeal will unduly hinder the progress of the action.

The Court stated that the CCAA judge carefully considered all of the submissions made by Feldstein and provided cogent reasons for the order he made.

First, the Court stated that there is authority for the proposition that a CCAA stay may be extended for purposes other than effecting a restructuring and therefore, the CCAA judge did not err in granting a three-month extension of the stay in the circumstances of the case.  The Court also noted that the stay expired on June 30, 2017, so by the time an appeal could be heard on this issue, it would be moot.

Second, the Court stated that Feldstein raised objections to the conduct of the litigation trustee in response to the request for an extension of the stay and cannot complain that the CCAA judge ruled on that point.

Finally, the Court stated that the findings of the CCAA judge, including that the responding parties have acted in good faith and with due diligence and that the litigation trustee is acting in an appropriate manner, are essentially factual in nature and attract deference on appeal. Moreover, those findings do not have sufficient significance to the practice to warrant granting leave.

Paradigm Quest Inc. v. McInroy, 2017 ONCA 547

[Watt, Benotto and Roberts J.A.]

Counsel:

J.M. Butson and C. Internicola, for the appellant

T.P. McInroy, acting in person

Keywords: Civil Procedure, Appeals, Interlocutory or Final Orders, Jurisdiction

Facts:

This appeal is from summary judgment granting the appellants an order of possession of the respondent’s property. The judgment was ordered to held in abeyance until September 15, 2017, on the condition that the respondent makes payments on his account of arrears owing to the appellant. If the respondent defaults, the order of possession in favour of the appellant is triggered.

The appellants appealed on the ground that the motion judge lacked jurisdiction to order that the judgment be held in abeyance and to impose terms.

Issues:

(1) Did the motion judge lack jurisdiction to order that the judgment be held in abeyance?

Holding: Appeal dismissed.

Reasoning:

(1) No. An order granting or refusing a stay of execution of a judgment is an interlocutory order from which there is no right of appeal to the Ontario Court of Appeal, as per the court in Sun Life Assurance Co. v. York Ridge Developments Ltd. (1998), 116 O.A.C. 103, at para. 13. The appropriate court for this kind of appeal is the Divisional Court, with leave, under s. 19(1)(b) of the Courts of Justice Act.

Ravenda Homes Ltd. v. 1372708 Ontario Inc., 2017 ONCA 556

[LaForme, Hourigan and Paciocco JJ.A.]

Counsel:

R.C. Harason, for the moving party

P.H. Griffin, for the responding party

Keywords: Civil Procedure, Appeals, Security for Costs

Facts:

Sharpe J.A., sitting as a chambers judge denied the moving party’s request to order security for costs against the responding party. The security for costs sought was for the main action, the appeal in the main action and for the cross-appeal in the Divisional Court.  Sharpe J.A. declined to order security for costs because of: a) the delay in bringing the motion; b) the fact neither entitlement nor quantum of trial costs had been determined; c) the construction lien judgment in the responding party’s favour; and d) the excessive amount claimed for the costs of the appeal. The moving party moved to have Sharpe J.A.’s order varied or set aside.

Issues:

(1) Should Sharpe J.A.’s judgment be varied or set aside?

Holding:

Motion dismissed.

Reasoning:

(1) No. A judge of the Court of Appeal has discretion to award security for costs of an appeal, as well as the costs of the underlying motion or trial.

Sharpe J.A. appreciated and applied the correct law and reached his conclusions on facts that were undisputed. Even if Sharpe J.A. had found that all the requirements had been met to satisfy an order of security for costs, he was still entitled to refuse it if he found the justice of the case required this. His decision that the justice of the case required a refusal of the order, and his reasons for it, were reasonable in all the circumstances.

Total Mechanical Systems Limited v. Sheet Metal Workers’ International Association, Local 30, 2017 ONCA 559

[LaForme, Hourigan and Paciocco JJ.A.]

Counsel:

A. Rouben, for the appellant, Riccardo Lettieri
J. Heller, for the respondents

Keywords: Labour Law, Collective Agreements, Voluntary Recognition Agreements, Bhaduria v. Toronto Board of Education, [1999] 173 D.L.R. (4th) 382 (Ont. C.A.), Civil Procedure, Striking Pleadings, No Reasonable Cause of Action, Abuse of Process, Rules of Civil Procedure, Rule 21

Facts:

The appellant entered into a Voluntary Recognition Agreement (the VRA) on behalf of his wholly owned company with the respondent, Union. Since then, he has attempted to contest the validity of that agreement.

The first ground, asserted in response to a grievance by the Union before the Ontario Labour Relations Board (the OLRB) in October 2011, he was that the appelant was not of sound mind due to a health condition when he signed the VRA on behalf of his company. In April 2013, the Divisional Court denied a judicial review application of the Board’s decision dismissing this ground.

Second, and while the OLRB proceedings were going on, the appellant launched an action in the Superior Court for damages in July 2011. Despite prior agreements to the contrary, the appellant noted the Union in default on February 28, 2012, which on consent, was set aside on May 25, 2012. On January 14, 2013, the Union was again noted in default. In December 2015, the corporate plaintiffs discontinued against the Union leaving only the appellant. Finally, on January 21, 2016, the appellant issued a Fresh as Amended Statement of Claim.

By order dated December 7, 2016, the Union was successful in obtaining an order that: (i) the default of January 13, 2013, was set aside; and (ii) the Fresh as Amended Statement of Claim dated January 21, 2016 was dismissed under r. 21.01 as disclosing no reasonable cause of action.

The motion judge concluded that, the “essential character of the issues in the matter was based on a determination of the validity of the VRA signed by the appellant on behalf of his corporations.” The motion judge held that the OLRB, which had exclusive jurisdiction over the issue, made a judicial determination that the VRA was valid.

The appellant appealed the motion judge’s order only in connection with the dismissal of his action. The essence of his complaint was that he was not personally a party to the collective agreement, and therefore he could attack the validity of it in a Superior Court action notwithstanding the OLRB’s determinations. For that reason, he also claimed that the doctrines of res judicata and abuse of process did not apply.

Issues:

(1) Did the motion judge err in striking the Fresh as Amended Statement of Claim?

Holding:

Appeal dismissed.

Reasoning:

(1) No. The motion judge correctly noted that all of the appellant’s claims in the Fresh as Amended Statement of Claim were dependent on his assertion that he was not a party to the VRA because he had no capacity to execute the agreement and the Union representatives were aware of that.

In its October 2011 decision, the OLRB concluded that the VRA applied and there was no basis upon which the VRA should not be enforced as valid. This included a rejection of the appellant’s assertion that he was unwell at the time of signing the agreement, and did not understand the nature and effect of what he was signing.

In its April 10, 2013 decision, the Divisional Court dismissed the application of the appellant for judicial review. In doing so, it found that the evidence before the Board was that at the time that the appellant signed the agreement, his brother was unaware of his incapacity; therefore, if his own brother was unaware of the problem, it stands to reason that the Union was not in a position to have either actual or constructive knowledge of the appellant’s incapacity. Thus, the enforceability of the VRA and the effect of the appellant’s health on its validity and enforceability have already been adjudicated upon.

The motion judge concluded that the OLRB properly had jurisdiction over the matter because the “essential character” of the claim arose from the VRA. The VRA is a collective agreement and its “interpretation, application, administration or violation is to be determined by an arbitrator”: see Bhaduria v. Toronto Board of Education, [1999] 173 D.L.R. (4th) 382 (Ont. C.A.).

Furthermore, just as the motion judge held, the Court of Appeal agreed that the Fresh as Amended Statement of Claim amounted to an abuse of process. It very clearly read as simply another attempt to re-litigate decisions of the OLRB and the Divisional Court in another forum.

Accordingly, the appeal was dismissed.

Yormak v. Arvai, 2017 ONCA 550

[Watt, Benotto and Roberts J.J.A.]

Counsel:

S.R. Yormak, appearing in person

L.J. Crowley, for the respondents

Keywords: Contracts, Solicitor and Client, Referral Fees, Rules of Professional Conduct, r. 2.08(7)

Facts:

This appeal arose from a summary judgment that was granted in favour of the respondent dismissing the appellant’s action. The appellant was seeking payment of a 15 percent referral fee in relation to a referral that the appellant gave to the respondent.

He submitted that the respondent breached his contractual obligations of good faith.

Issues:

(1) Did the motion judge err in granting summary judgement to the respondent?

Holding: Appeal dismissed.

Reasoning:

(1) No. As lawyers in good standing, the appellant and respondent are subject to the Rules of Professional Conduct (Rules). The Rules state under what was then r. 2.08(7), that a referral fee may only be paid by one lawyer to another if: (a) the fee is reasonable and does not increase the total amount of the fee charged to the client; and (b) the client is informed and consents.

The motion judge was correct in stating that the appellant`s requested referral fee did not comply with any of the requirements of r. 2.08(7). The client did not consent to the fee because it was unreasonable. There is no genuine issue requiring a trial with regards to determining the reasonableness of the referral fee.

Amyotrophic Lateral Sclerosis Society of Essex County v. Windsor (City), 2017 ONCA 555

[Hoy A.C.J.O., van Rensburg and Roberts JJ.A.]

Counsel:

R.B. Bell and B.N. Radnoff, for the appellants

B. van Niejenhuis and F. Schumann, for the respondents

Keywords: Civil Procedure, Class Proceedings, Appeals, Motions to Quash, Jurisdiction, Interlocutory or Final Orders, Pleadings, Amendments

Facts:

These appeals and motions to quash appeals arise in the context of related class actions being case managed by Patterson J. (the “case management judge”). The appellant charitable organizations seek remedies for what they characterize as unconstitutional or illegal taxation by the respondent municipalities. The appeals are from four orders of the case management judge.

Motion to quash appeals from the January 2017 orders: The proceedings were certified as class actions in 2015. The opt-out period ran from January 15 to May 15, 2016. The respondents organized a campaign to encourage class members to opt out. The case management judge determined the respondents

went “over the line” and created “undue influence”, and consequently, in January 2017 ordered that those who had opted out be given a reconsideration period, which ran from August 11 to October 10, 2016.

The case management judge ordered the respondents not to communicate with class members during that period and protective orders were made that permitted the respondents’ counsel to know the identities of opt-outs but prevented them from sharing this information with their clients. Once the reconsideration period ended, the respondents’ counsel sought to lift the protective orders and asserted that they were interim. Class counsel sought conditions to protect the confidentiality of the information and a declaration that the implied and deemed undertaking rules applied to the information concerning the opt-outs. The case management judge ordered that the protective orders be lifted and held that for those orders to be continued, there would need to be “a serious risk to an important interest” and that there was insufficient evidence of a serious threat to the appellants in this case. The respondents brought a motion to quash the appeals from the orders lifting the protective orders because they are interlocutory and that the route to appeal is to the Divisional Court, with leave.

Appeal of the November 2016 orders: After the end of the opt-out period, the appellants sought to amend the statements of claim. The appellants sought declarations that the lottery licensing fees and lottery administration fees paid by the plaintiffs and the other class members to the defendant municipalities are taxes levied without legislative and constitutional authority and are ultra vires the defendant municipalities. They also sought an accounting of licensing and administration fees received by the municipalities found to be levied without authority or ultra vires, and disgorgement of such fees, with an alternative claim of restitution of fees charged to the plaintiffs and other class members in accordance with the accounting. The case management judge refused the proposed amendments on the basis that they would fundamentally change the nature of the actions that had been certified.

Issues:

(1)  Are the protective orders interlocutory?

(2) Did the case management judge err in refusing the proposed amendments to the statements of claim?

Holding: Appeals of January 2017 orders quashed and appeals of November 2016 orders dismissed.

Reasoning:

(1) Yes. The court held the question was whether the January 2017 orders were final and appealable to the Court of Appeal under s. 6(1)(b) or whether they were interlocutory and appealable to the Divisional Court with leave under s. 19(1)(b) of the Courts of Justice Act. The court found the orders were res judicata on the question of whether the identities and other information concerning opt-outs could be revealed, but were not res judicata and did not determine on any final basis any substantive issue or right that could be determinative of the action. The court held the orders were interim in nature and should not outlast the reconsideration period for which they were granted. The decision to lift them was a decision not to continue a protective order and, as such, was interlocutory.

(2) No. The court held the proposed amendments sought to recast the claim from one for the return of fees paid by class members to a claim for disgorgement of all allegedly illegal license and administrative fees for bingo operations paid to the respondent municipalities within the class period, including those not paid by members of the class. The court agreed with the case management judge that in these proceedings “each class member’s claim is limited to the gain received by the defendants from the individual class member” and that “any refund would only allow the individual plaintiffs to recover the defendants’ gain attributable to the wrong done to them”.

Bakshi v. Global Credit & Collection Inc., 2017 ONCA

[LaForme, Hourigan and Paciocco JJ.A.]

Counsel:

J.E. Callaghan and K. Alexander, for the appellant

D. Milosevic and C. Garrod, for the respondent

Keywords: Contracts, Employment Law, Class Proceedings, Summary Judgment

Facts:

The appellant was one of several hundred debt collectors whom the respondent laid off when the respondent lost a contract with its largest client, Capital One. Following the lay-offs, Capital One and the respondent entered into a Settlement Agreement in which Capital One agreed to pay a sum of money for the broad mutual release of claims. The appellant became representative plaintiff in a class action in which the class of debt collectors sued the respondent. He alleged that the respondent had breached part of each class member’s employment contract (“Commission Agreement”) by failing to pay commissions on the payment made under the Settlement Agreement. After certification of the class, the respondent was awarded summary judgment dismissing the claim.

Issues:

(1) Did the motion judge err in interpreting the Commission Agreement as disentitling the appellants from receiving any commissions while laid-off?

(2) Did the motion judge err in interpreting the payment under the Settlement Agreement as reflecting a settlement of the respondent’s potential damages claim for extraordinary expenses and defamation?

(3) Did the motion judge err in holding that a motion for summary judgment was an appropriate procedure for resolving the common issues in the class action?

Holding: Appeal dismissed.

Reasoning:

Since neither the Commission Agreement nor Settlement Agreement were standard form contracts, the standard of review from issues of contractual interpretation was palpable and overriding error.

(1) No. Under the Commission Agreement, a collector had to exceed a “breakeven” financial target set by the respondent to be entitled to a commission. In this case, a laid-off employee could not possibly be collecting monthly payments sufficient to exceed the monthly “breakeven” requirement.

(2) No. Even if the Settlement Agreement could be interpreted as including a payment for returned post-dated payments, the court’s conclusion on the first issue, that the class members had not “earned” any commissions, precludes entitlement to receive any commissions on such a payment by Capital One.

(3) No. Not only did appellant’s counsel write to the motion judge stating that the parties agreed the motion judge had sufficient evidence before him to decide the issues, but the appellant never argued in the court below that summary judgment was inappropriate. Moreover, the appellant brought his own motion for summary judgment of the common issues.

Tracy v. Iran (Information and Security), 2017 ONCA 549

[Hoy A.C.J.O., Blair and Hourigan JJ.A.]

Counsel:

C. Stevenson and J.D. McConville, for the appellants

J. Adair and G. McGuire, for the respondents

John B. Laskin, Sarah Whitmore, Eliot Che for the respondents, Marthaler, Holland and American Center for Civil Justice, Inc.

Jacqueline Dais-Visca, and Joseph Cheng for the intervener, the Attorney General of Canada

Keywords: Private International Law, Conflict of Laws, Enforcement of Foreign Judgments, Jurisidiction, Real and Substantial Connection, Beals v. Saldanha, 2003 SCC 72, [2003] 3 SCR 416, State Immunity, Justice for Victims of Terrorism Act, S.C. 2012, c. 1, s 4(5), State Immunity Act, R.S.C 1985, c. S-18, s. 6.1(2), 12

Facts:

This action arose out of judgments rendered against the respondents that were issued by courts in the United States against the appellants. The respondents sued in Ontario to enforce the United States judgments under the provisions of the The Justice for Victims of Terrorism Act, S.C. 2012, c. 1 (“JVTA”). The appellants did not defend these actions in Ontario and lost on appeal in front of a motions judge.

Two pieces of Canadian legislation are relevant to this appeal. The first is the JVTA, which grants victims of terrorism the ability to sue terrorists and foreign states that have materially contributed to terrorist attacks. The second is the State Immunity Act, R.S.C 1985, c. S-18 (“SIA”), which creates an exception to the general rule of state immunity from court jurisdiction and enforcement to countries that are listed under s. 6.1(2) as supporters of terrorism. Iran was added to the list under s. 6.1(2) on September 7, 2012.

The appellants appealed to the Ontario Court of Appeal alleging that the motion judge erred on every legal issue before him when denying their appeal.

Issues:

(1) Was the appellants’ immunity from the jurisdiction of the Canadian courts removed by the JVTA or s. 6.1 of the SIA?

(2) Does the JVTA require or permit Canadian courts to recognize the American judgments?

(3) Did the motion judge err when he found that the appellants’ immunity from enforcement or attachment was removed by s. 12(1)(d) of the SIA?

(4) Did the motion judge err when he found that the appellants’ bank accounts and two real properties were not protected by diplomatic immunity?

(5) Did the motion judge err by failing to set aside the Recognition Order?

(6) Did the motion judge err in his application of the test for setting aside default judgments?

(7) Did the motion judge err in awarding costs to the respondents?

Holding: Appeal dismissed.

Reasoning:

(1) Yes. By virtue of the JVTA and the amendments to the SIA, the appellants’ state immunity has been lifted with respect to its sponsorship of terrorist acts that occurred on or after January 1, 1985, but not for sponsorship of terrorist activities that occurred before that date.

The appellants argued that the JVTA cannot apply retroactively, and or that it goes against international law. Even if this were the case, Parliament has the power to make legislation retroactive and has the power to ignore international law through the use of clear statutory language.

A review of s. 4(5) of the JVTA makes clear that the appellant’s state immunity is lifted only to the extent permitted by the SIA, which is any act that occurred on or after January 1, 1985. The law of state immunity in Canada is encompassed in s. 3(1) of the SIA, which states that “except as provided by the Act, a foreign state is immune from the jurisdiction of any court in Canada”. The SIA was amended under Bill C-10, which carved out an exception for the JVTA, with the intention of the two statutes working in symmetry to permit the effective operation of the JVTA.

The appellants further argued that they were immune because the respondents did not prove that the appellants were a state supporter of terrorism. The only proof of the support of terrorism necessary to maintain an enforcement action under s. 4(5) of the JVTA is the listing of the state sought to be sued under s. 6.1(1) of the SIA.

Finally, the trial judge properly relied upon the facts found in the U.S. judgments, and the respondents were not required to prove the commission of a specific criminal offence beyond a reasonable doubt.

(2) Yes. Subsection 4(5) of the JVTA sets forth the process for recognition of the American judgments.

None of the arguments advanced by the appellants defeat recognition. There was ample evidence that the appellants’ conduct would be punishable under the Criminal Code. The claims are not time-barred, as the cause of action did not begin to run until Iran was listed under s. 6.1(1) of the SIA.

The American courts had jurisdiction to grant the judgments. The court in Chevron stated that a foreign court will be found to have properly assumed jurisdiction where it had a real and substantial connection with the litigants or with the subject matter. The American courts properly assumed jurisdiction because the actions were commenced pursuant to an American statute that authorized them.

Finally, recognition of the judgments is not contrary to Canadian public policy. Once it is determined that a foreign court properly assumed jurisdiction, a foreign judgment is prima facie enforceable. The burden then shifts to the foreign defendant to establish the availability of a defence to the recognition of a foreign judgment, as per the Supreme Court’s decision in Beals v. Saldanha, 2003 SCC 72, [2003] 3 SCR 416 at para 39. The threshold for such a defence is high, the judgment must violate “conceptions of essential justice and morality” (Beals at para 222). The appellants do not meet this threshold.

(3) No. State immunity from enforcement was stripped from the appellants.

Section 12(1)(d) of the SIA strips a state of execution immunity where:

the foreign state is set out on the list referred to in subsection 6.1(2) and the attachment or execution relates to a judgment rendered in an action brought against it for its support of terrorism or its terrorist activity and to property other than property that has cultural or historical value.

The underlying U.S. judgments were based on the appellants’ support of terrorism, and the Iranian Assets do not have any cultural or historical value.

(4) No. The time for determination of the eligibility of the Iranian Assets is the time of the purported execution. The Minister determines the diplomatic status of the Iranian Assets. There was a solid evidentiary basis for the motion judge to conclude that the Iranian Assets were not protected by diplomatic immunity, and the motion judge’s reasoning is entitled to deference.

Further, the issue of notice of the loss of diplomatic immunity is not relevant because, given the existence of international sanctions against the appellants, notice would have had no practical effect.

(5) No. The appellants missed the statutory deadline to move to set aside the Recognition Order. It is required that such motions be brought within one month after the judgment debtor has notice of registration, but the appellants did not move to set it aside until over a year later. It has not sought leave to extend the deadline, nor offered an explanation as to why the deadline was missed. The appellants’ complaint about the manner of service of the Recognition Order is therefore without merit.

(6) No. The motion judge applied the correct test. The appellants did not meet their onus in establishing that even a single factor militated in favour of setting aside the default judgements. In addition, the interests of justice do not support such an order because the appellants were properly served and ultimately chose to take their chances with the court process by not responding to claims and waiting to have them set aside on a subsequent motion.

(7) No. The awarding of costs was consistent with the text of both the JVTA and the SIA. There is no principled reason why the appellants should be immune from a costs award. The suggestion otherwise is contrary to binding Supreme Court of Canada jurisprudence, specifically as set out in the decision of Kuwait Airways Corp. v. Iraq, 2010 SCC 40, [2010] 2 SCR 571 at para 36.

Vanier v. Vanier, 2017 ONCA 561

[Epstein, Benotto and Trotter JJ.A.]

Counsel:

L. J. Tupman and J. E. S. Poyser, for the appellant

J. Vanier, acting in person

D. N. Delagran, for the respondents

Keywords: Wills and Estates, Powers of Attorney for Property, Substitute Decisions Act, 1992, S.O. 1992, c. 30, New Issues on Appeal, Undue Influence,  Kaiman v. Graham, 2009 ONCA 77

Facts:

The respondent and her husband built a successful business during their marriage. The respondent’s husband died in 2011 and left his entire estate to the respondent. The respondent’s two sons and daughter have struggled in deciding who should be the respondent’s power of attorney. The respondent designated her daughter as her attorney for property under a Continuing Power of Attorney for Property in 2011 (the “2011 CPOAP”). The respondent’s daughter allegedly took advantage of her authority under the 2011 CPOAP and diverted several hundred thousand dollars from the respondent to herself, leading to litigation that has since settled. The respondent subsequently granted her two sons power of attorney for her property, jointly and severally, in 2013 (the “2013 CPOAP”).

After the respondent and her daughter settled litigation, the respondent’s two sons grew suspicious of each other with respect to how the other handled the respondent’s property. This resulted in the Respondent executing a new CPOAP (the “2015 CPOAP”), removing one of her sons (Raymond) as co-attorney for property and appointing her other son (Pierre) as her sole attorney for property.

Raymond took issue with the 2015 CPOAP and brought an application under the Substitute Decisions Act, 1992, S.O. 1992, c. 30 (the “SDA”), seeking several orders, including the removal of Pierre as attorney for property, and a declaration that the 2015 CPOAP was void. Raymond brought a motion, heard July 5, 2016, seeking an order removing Pierre as attorney for property on an interim basis pending determination of the application, an order appointing an interim guardian of property for the respondent, and an order requiring Pierre to pass accounts.

The motion judge ordered Pierre to pass his accounts, but dismissed the motion and declared the 2015 CPOAP to be valid. Raymond appealed the dismissal on several grounds.

Issues:

(1) Did the motion judge err in in applying the wrong test for undue influence?

(2) Did the motion judge err in finding that the evidence did not establish suspicious circumstances?

(3) Did the motion judge err in not considering relevant evidence?

(4) Did the motion judge err in granting costs against Raymond?

Holding: Appeal dismissed.

Reasoning:

(1) No. There is no indication that the application of the inter vivos equitable undue influence test was argued before the motion judge. As established in Kaiman v. Graham, 2009 ONCA 77, there is a general rule that appellate courts will not entertain entirely new issues on appeal. The burden is on the appellant to persuade the appellate court that “all the facts necessary to address the point are before the court as fully as if the issue had been raised at trial”.

The Court held that it did not need to decide whether it was in the interests of justice for this issue to be dealt with because the inter vivos equitable undue influence test has no application on the facts of this case. There are two prerequisites to the evidential shift in the burden of proof from the complainant to the other party. First, the complainant must have reposed trust and confidence in the other party. Second, the transaction must not be readily explicable by the parties’ relationship.

This test could not be satisfied. With respect to first stage of the test, Pierre conceded to the first part of the test in oral argument. With respect to the second stage of the test, the record does not support that there was anything “immoderate or irrational” about the 2015 CPOAP. The respondent’s decision to give power of attorney to one son over the other was a rational decision.

(2) No. The Court did not see it appropriate to consider the application of the doctrine of suspicious circumstances to powers of attorney as a whole. This was dealt with briefly in front of the motion judge and was ultimately found not to apply.

(3) No. A motion judge is not required to mention every single piece of evidence. The record demonstrates that the motion judge was aware of the evidence referred to by the appellant. The fact that the motion judge did not expressly mention a given piece of evidence in his reasons does not mean that he failed to consider them.

(4) No. The Court agreed with the motion judge’s decision that the litigation reflected a “lack of judgement” on Raymond’s part. Moreover, the Court was unable to assess Raymond’s reasonable expectations as to costs, or the amount he would have sought if he won, because he did not submit a bill of costs.

York Region Standard Condominium Corporation No. 1253 v. Hashemi, 2017 ONCA 557

[Rouleau, Pepall and Roberts JJ.A.]

Counsel:

T. Duggan and S. Toole, for the appellant

W. Greenspoon-Soer and M. Unger-Peters, for the respondents

Keywords: Real Property, Condominiums, Damages, Mitigation, Full Indemnity Costs, Condominium Act, 1998, S.O. 1998, c.19, s. 134(5), Rules of Civil Procedure, r. 57, Metropolitan Toronto Condominium Corp. No. 1385 v. Skyline Executive Properties Inc. (2005), 253 D.L.R. (4th) 656 (Ont. C.A), Boucher v. Public Accountants Council (Ontario) (2004),71 O.R. (3d) 291 (C.A.)

Facts:

The appellant condominium corporation (“YRSCC”) appealed from an award of $18,000 in damages made in its favour against the respondent condominium unit owners and also sought leave to appeal an award of $17,000 in full indemnity costs made under s. 134(5) of the Condominium Act, 1998, S.O. 1998, c.19 (the “Act”)

The respondents leased their condominium to tenants who vandalized the common elements of YRSCC. YRSCC commenced an application against the respondents and their tenants claiming declaratory and injunctive relief, an eviction order, damages representing the cost of repairs, and costs. The respondents conceded liability and the only contested issues were damages and costs. YRSCC claimed $33,381.28 in damages and an award of costs of $52,637.56.

The application judge observed that under s. 17 of the Act, a condominium corporation is required to take reasonable steps to ensure compliance with the Act, and this includes incurring reasonable costs to remedy any transgressions by unit owners or their tenants. Although YRSCC was entitled to rectify the damage, it had a duty to do so proportionately – which the application judge found that it did not do.  He therefore awarded $18,000 in damages rather than $33,381.28 claimed by YRSCC. Turning to the issue of costs, heawarded YRSCC $17,000 rather than $52,637.56.

Issues:

(1) Did the application judge err in finding that YRSCC breached its duty to mitigate its damages?

(2) Did the application judge err in finding that the installation cost of security cameras was unreasonable?

(3) Did the application judge misapprehend and misapply the provisions of s. 134(5) of the Act in his assessment of costs.

Holding:

Appeal allowed, in part.

Reasoning:

(1) No. The appellant acknowledged that it had a duty pursuant to the Act to act reasonably in connection with repairing damage caused by vandalism. Based on the evidence before him, including the invoices which he reviewed, it was open to the application judge to determine that several of the expenditures that YRSCC made were disproportionate.

(2) Yes. The Court of Appeal found that the application judge erred in finding that the installation cost of security cameras was unreasonable. The affidavit evidence revealed that the contractor had split the total cost of his services between two invoices and did not charge twice for the same service.

(3) Yes. There were two dimensions to the request for costs advanced by YRSCC. First, it claimed the costs of the application based on r. 57 of the Rules of Civil Procedure. Second, it claimed its additional actual costs based on s. 134(5) of the Act. In Metropolitan Toronto Condominium Corp. No. 1385 v. Skyline Executive Properties Inc. (2005), 253 D.L.R. (4th) 656 (Ont. C.A), Doherty J.A. explained at para. 8 that “an award of costs” refers to the costs that the court orders one litigant to pay to another litigant whereas “additional actual costs” can encompass those legal costs owing as between the client and its own lawyer beyond the costs that the court has ordered paid by an opposing party.

In seeking additional actual costs under s. 134(5) of the Act, YRSCC advised the trial judge that the order requested had three components: damages, costs and s. 134(5) costs; and that the standard for r. 57 costs was that described in Boucher v. Public Accountants Council (Ontario) (2004), 71 O.R. (3d) 291 (C.A.), whereas the standard for s. 134(5) costs was a solicitor and his own client assessment. The application judge considered an order of $12,000 to be an appropriate partial indemnity cost award under r. 57 and ultimately ordered an additional $5,000 under s. 134(5) of the Act for a total full indemnity cost award of $17,000.

The application judge considered YRSCC’s “full indemnity” costs but appears to have focussed on the costs as between the parties without reference to the additional actual costs. Had he considered additional actual costs, then costs such as administrative and managerial costs that were associated with obtaining the order would have been eligible for assessment.

However, YRSCC did not file the necessary underlying evidentiary materials supporting the claim for all of its additional actual costs and did not seek an adjournment to address this deficiency in the record. Of the $52,637.56 claimed for costs, YRSCC established entitlement to approximately $34,000. In the result, the Court of Appeal varied the order on costs and increased costs from $17,000 to $34,000 so as to account for actual additional costs established by YRSCC.

Civil Endorsements:

Belanger v. Sudbury (Regional Municipality), 2017 ONCA 546

[Strathy C.J.O., Cronk and Pepall JJ.A.]

Counsel:

C. K. Boggs and D. Litwin, for the appellant

P. J. Pape, S. Chaudhury, J. Morse and J. L. Nairn, for the respondents

Keywords: Costs

Criminal Decisions:

R. v. Bye, 2017 ONCA 528

[Strathy C.J.O., Benotto and Miller JJ.A.]

Counsel:

T. E. Breen, for the appellant

S. Porter, for the respondent

Keywords: Criminal Law, Aggravated Assault, Expert Evidence, Admissibility, R. v. Ferguson (1999) 142 C.C.C. (3d) 353 (S.C.C.), Jury Charge, Reasonable Doubt,  R. v. W.(D.), [1991] 1 S.C.R. 742

R. v. El-Kasir, 2017 ONCA 531

[Brown J.A. (In Chambers)]

Counsel:

F. El-Kasir, applicant

C. M. Gleason-Mercier, duty counsel

G. K. Papadopoulos, for the respondent

Keywords: Criminal Law, Leave to Appeal, Extension of Time, R. v. Ansari, 2015 ONCA 891, Provincial Offences Act, ss. 131 and 139, Antorisa Investments Ltd. v. Vaughan (City), 2012 ONCA 586

R. v. Daniels, 2017 ONCA 551

[Strathy C.J.O., Benotto and Miller JJ.A.]

Counsel:

B. Vandebeek, for the appellant

L. Csele, for the respondent

Keywords: Criminal Law, Possession for the Purpose of Trafficking, Telewarrant, Canadian Charter of Rights and Freedoms, ss. 8 and 24(2), R. v. Morelli, 2010 SCC 8, [2010] 1 S.C.R. 253, Sentencing, Leave to Appeal, R. v. Lacasse, [2015] 3 S.C.R. 1089

R. v. Fedele, 2017 ONCA 554

[Rouleau, van Rensburg and Pardu JJ.A.]

Counsel:

K. Beaudoin, for the appellant

S. C.. Hutchison and L. Binhammer, for the respondent

Keywords: Criminal Law, Theft, R. v. McIntosh, [1995] 1 S.C.R. 686., R. v. Tinker, 2017 ONCA 552, 340 C.C.C. (3d) 547, Criminal Code, s.737, Victim Fine Surcharge

R. v. Gonzales, 2017 ONCA 543

[Feldman, Watt and Huscroft JJ.A.]

Counsel:

G. Lafontaine, for the appellant
G. Zaman and K. Ramchand, for the respondent

Keywords: Criminal Law, Possession of Marijuana, Arbitrary Detainment, Unlawful Arrest, Unreasonable Search, Canadian Charter of Rights and Freedoms, ss. 8, 9, 10(a) and (b), 24(2), Criminal Code, ss. 495(1)(a) and (b), R. v. Loewen, 2011 SCC 21, [2011] 2 S.C.R. 167, R. v. Grant, 2009 SCC 32, [2009] 2 S.C.R. 353, R. v. Suberu, 2009 SCC 33, [2009] 2 S.C.R. 46

R. v. Heffern, 2017 ONCA 564

[Watt, Benotto and Roberts J.A.]

Counsel:

C. A. Matthews, for the appellant

R. DeFilippis, for the respondent

Keywords: Criminal Law, Assault Causing Bodily Harm, Kidnapping, Breach of Probation, Evidence, Credibility

R. v. Mhlongo, 2017 ONCA 562

[MacPherson, Blair and Epstein JJ.A.]

Counsel:

N. Gorham, for the appellant

V. Chan and A. Weiler, for the respondent

Keywords: Criminal Law, Possession of Cocaine for the Purpose of Trafficking, Unlawful Detention,  Canadian Charter of Rights and Freedoms, ss. 8, 9, 10(b), 24(2), R. v. Mann, 2004 SCC 52, R. v. Suberu, 2009 SCC 33, 245 C.C.C. (3d) 112, R. v. Johnson, 2013 ONCA 177, 297 C.C.C. (3d) 87, R. v. Grant, 2009 SCC 32

R. v. Today Food Inc., 2017 ONCA 565

[Watt, Benotto and Roberts JJ.A.]

Counsel:

L. Qu, in person for the appellant

A. Ross, for the respondent

Keywords: Provincial Offences, Operating Food Premises in Manner Permitting a Health Hazard, Health Protection and Promotion Act, R.S.O. 1990, ch. 7, s. 100(4), Ontario Food Premises Regulation 562

R. v. Wright, 2017 ONCA 560

[Simmons, van Rensburg and Miller JJ.A.]

Counsel:

C. Martell, for the appellant

K. Wilson, for the respondent

Keywords: Criminal Law, Trafficking, Evidence, Fabrication, Unreasonable Verdict,  R. v. O’Connor (2002), 62 O.R. (3d) 263 (C.A.), R. v. W.(D.), [1991] 1 S.C.R. 742, R. v. Laliberté, 2016 SCC 17, [2016] 1 S.C.R. 270, R. v. Villaroman, 2016 SCC 33, [2016] 1 S.C.R. 1000

R. v. Tinker, 2017 ONCA 552

[Rouleau, van Resnburg and Pardu JJ.A.]

Counsel:

D. Doucette, D. Santoro, M. Howatt, J. Foord, B. Crawford and Y. Jubinville, for the appellants

M. Perlin, P. Crowle, L. Boucher, and T. Radcliffe, for the respondents

Keywords: Criminal Law, Mandatory Victim Surcharge, Surcharge Regime, Leave to Appeal, Criminal Code of Canada, ss. 734 & 737, Deprivation of Liberty, Deprivation of Security of the Person, Cruel and Unusual Punishment, Canadian Charter of Rights and Freedoms ss. 7 & 12, Increasing Offenders’ Accountability for Victims Act, S.C. 2013, c. 11, Bill C-37

Ontario Review Board Appeals:

Shepherd (Re), 2017 ONCA 530

[Strathy C.J.O, Benotto and Miller JJ.A.]

Counsel:

F. Shepherd, in person

K. J. Berger, for the appellant

J. A. Zamprogna Ballès, for the respondent, The Person in Charge of the Southwest Centre for Forensic Mental Health St. Joseph’s Health Care London

A. Hrybinsky, for the respondent, The Attorney General of Ontario

Keywords: Mental Health, Assault, Criminal Harassment, Forcible Confinement, Re Kelly, 2015 ONCA 95, Joint Submissions, Re Osawe, 2015 ONCA 280

Wakeling (Re), 2017 ONCA 536

[Strathy C.J.O, Benotto and Miller JJ.A.]

Counsel:

D. F. Moore and T. Hashmani, for the appellant

G. S. MacKenzie, for the respondent, The Person in Charge of the Centre for Addiction and Mental Health

P. Fraser, for the respondent, The Attorney General of Ontario

Keywords: Mental Health, Not Criminally Responsible, Criminal Harassment, Public Safety, Winko v. British Columbia (Forensic Psychiatric Institute), [1999] 2 S.C.R. 625

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