ONTARIO COURT OF APPEAL SUMMARIES (APRIL 16 – APRIL 20, 2018 )

Good afternoon:

In Atos IT Solutions v Sapient Canada Inc., the Court confirmed that the “minimum performance principle” places a common law limit on expectation damages for breach of contract. In cases where the defaulting party has alternative modes of performing the contract, damages are calculated on the basis of the mode of performance that is least burdensome to the defaulting party and least profitable to the non-breaching party. A termination for convenience clause therefore effectively defines the upper limit of expectation damages, even where the defaulting party did not terminate under that clause, but rather purported to terminate for cause.

In Ojeikere v Ojeikere, a child abduction case, the Court took jurisdiction over custody and access of the children even though their habitual residence was Nigeria and there was an outstanding custody application pending in that country. The court relied on section 23 of the Children’s Law Reform Act, which gave jurisdiction because the children were in Ontario and were found to be a risk of serious harm if they were to return to Nigeria. Coincidentally, the Supreme Court released another important child abduction decision today called Office of the Children’s Lawyer v Balev.

Other topics covered this week included negligent misrepresentation, negligent police investigation, oppression in the not-for-profit corporation context, sealing orders, commercial mortgage lending, LTD coverage, occupier’s liability, defamation and costs.

John Polyzogopoulos

Blaney McMurtry LLP

jpolyzogopoulos@blaney.com

Tel: 416 593 2953

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

2249659 Ontario Ltd. v. Sparkasse Siegen, 2018 ONCA 371

Keywords: Torts, Negligent Misrepresentation, Contracts, Guarantees, Civil Procedure, Procedural Fairness

Connelly v. Toronto (Police Services Board), 2018 ONCA 368

Keywords: Torts, Negligent Investigation, Duty of Care, Police, Wellington v. Ontario, 2011 ONCA 274, Hill v. Hamilton-Wentworth (Regional Municipality) Police Services Board, 2007 SCC 41, Civil Procedure, Striking Pleadings, No Reasonable Cause of Action,  Rules of Civil Procedure, Rule 21

Ojeikere v. Ojeikere, 2018 ONCA 372

Keywords: Family Law, Custody and Access, Child Abduction, Jurisdiction, Children’s Law Reform Act, R.S.O. 1990, c. C.12, ss. 22-23, Best Interests of the Child, Habitual Residence, Risk of Serious Harm, H.E. v. M.M., 2015 ONCA 813, Convention on the Civil Aspects of International Child Abduction, Article 13(b), Fresh Evidence, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 134(b)

Atos IT Solutions v. Sapient Canada Inc., 2018 ONCA 374

Keywords: Contracts, Breach of Contract, Damages, Minimum Performance Principle, Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, Duty of Good Faith and Honest Performance, Bhasin v. Hrynew, 2014 SCC 71, Agribrands Purina Canada Inc. v. Kasamekas, 2011 ONCA 460, Contract Interpretation, Standard of Review, Palpable and Overriding Error, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Commercial Absurdity, Exclusion Clauses, Tercon  Contractors Ltd. v. British Columbia (Ministry of Transportation and Highways), 2010 SCC 4

Watto v. Immigration Consultants of Canada Regulatory Council, 2018 ONCA 376

Keywords: Corporations, Not-for-Profit Corporations, Oppression, Canada Not-ForProfit Corporation Act, SC 2009, C. 23, Limitation Periods, Limitations Act, 2002, S.O. 2002, C. 24

Winter v. Sherman Estate, 2018 ONCA 379

Keywords: Civil Procedure, Sealing Orders, Solicitor-Client Privilege, Personal Health Information, Sierra Club v. Canada (Minister of Finance), 2002 SCC 41, Litigation Guardians

Auciello v. CIBC Mortgages Inc., 2018 ONCA 377

Keywords: Real Property, Commercial Lending, Mortgages, Commitment Letters, Conditions, Appraisals, Breach of Contract, Negligence, Bad Faith, Civil Procedure, Summary Judgment, Adjournments

MacIvor v. Pitney Bowes, 2018 ONCA 381

Keywords: Contracts, Policies of Insurance, Interpretation, Coverage, Long Term Disability, Standard of Review, Correctness, Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co., 2016 SCC 37, Timely Notice of Claim, Relief from Forfeiture, Insurance Act, R.S.O. 1990, c. I.8, Courts of Justice Act, R.S.O. 1990, c. C.43

Osmond v. Watkins, 2018 ONCA 386

Keywords: Torts, Negligence, Occupier’s Liability, Occupiers’ Liability Act, R.S.O. 1990, c. O.2, s. 3(1), Mahe v. Boulianne, 2010 ABCA 32, Summary Judgment

Walsh Energy Inc. v. Better Business Bureau of Ottawa-Hull Incorporated, 2018 ONCA 383

Keywords: Torts, Defamation, Libel, Defences, Fair Comment, Costs, Reasonableness

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2249659 Ontario Ltd. v. Sparkasse Siegen, 2018 ONCA 371

[Watt, Pepall and Miller JJ.A.]

Counsel:

Jonathan Lisus and James Renihan, for the appellants

Evan Tingley, for the respondent Sparkasse Siegen

P.A. Neena Gupta, for the respondent Thomas Magnete GmbH

Keywords: Torts, Negligent Misrepresentation, Contracts, Guarantees, Civil Procedure, Procedural Fairness

Facts:

This appeal arises from the ruins of the turbulent economic times that gripped the automotive industry in 2008.  Relying on a claim of negligent misrepresentation, the appellant, Rohwedder Canada Inc. (“RCI”), looked to blame the respondents for losses suffered.  The trial judge dismissed the action.

As way of background, Chrysler awarded Getrag Transmission Manufacturing LLC (“Getrag”), a subsidiary of Getrag A.G., a German manufacturer and, at the time, the world’s largest transmission company, a major contract for more than $500 million to design and manufacture automobile transmissions.  Getrag subcontracted with the respondent, Thomas Magnete GmbH (“TM Germany”), to manufacture certain valves.  In turn, TM Germany issued a purchase order dated September 7, 2007, to purchase three automated custom-designed assembly lines from the appellant, RCI, a subsidiary of a German public company, for C$6.75 million. RCI accepted the order on September 12, 2007.

Due to NAFTA regulations, the valves had to be manufactured in North America.  TM Germany established a wholly-owned subsidiary, Thomas Magnete Canada Inc. (“TM Canada”), to operate the manufacturing facility in Cambridge, Ontario.  TM Germany’s bank, Sparkasse Siegen (“Sparkasse”), loaned funds and administered a financing facility of EUR10 million, subject to various conditions, to TM Canada to set up the plant.  The loan was guaranteed by TM Germany and other related companies. Sparkasse reserved the right to terminate part of the loan facility on the basis of, among other things, “a significant deterioration in the asset situation of the end borrower [TM Canada]”.

RCI did not demand any guarantees from TM Germany. TM Germany sought to transfer its purchase order with RCI to TM Canada, which was not viewed as controversial by either TM Germany or RCI.

On December 19, 2007, Silvio Osim, RCI’s sales manager, wrote to TM Germany, stating:

Since we are transferring the PO from [TM Germany] to [TM Canada,] we would need a letter from [TM Germany] that, in case of illiquidity of [TM Canada], [TM Germany] would assume the project completion and any outstanding payments to [RCI].  This request came to me from our Controller who was informed about this requirement from our Bank.

At trial, Osim conceded that the last sentence of this email was untrue. RCI’s bank had not made such a request.

TM Germany forwarded Osim’s email to its bank, Sparkasse.  Ms. Mueller, the manager at Sparkasse responsible for the TM Canada file, explained at trial that she was familiar with the type of comfort letter requested by RCI.  She crafted a response stating that:

[T]he project of setting up a new production site by our client Thomas Magnete Group in Cambridge / Ontario is financially supported by [Sparkasse].

We hereby confirm, that – in line with the project plan – the necessary funds including expenses for the purchase of production lines and machinery are in place.

[TM Germany] provided a guarantee in our favour regarding the project’s financing scheme, thus accepting financial liability for the project.

Osim then responded and offered to send the signed purchase order immediately. RCI rendered its invoices to TM Canada and received payment from that company.

Getrag’s relationship with Chrysler then fell apart, and on October 18, 2008, Getrag announced that the deal with Chrysler was dead.  On November 17, 2008, Getrag filed for bankruptcy protection.  Sparkasse withdrew its financing to TM Canada and TM Canada closed.  In total, RCI received approximately 80% of the total contract price from TM Canada.

The appellant, 2249659 Ontario Ltd., an inactive company, purchased RCI including the cause of action against Sparkasse and TM Germany for one Euro on the insolvency of RCI’s parent company.  RCI is also now an inactive company.

In October 2010, the appellants sued Sparkasse and TM Germany for negligent misrepresentation.  They alleged that the Sparkasse letter had been, among other things, untrue, inaccurate, and misleading and had failed to disclose that Sparkasse’s financing was contingent on the financial health of TM Canada.  It claimed the respondents owed RCI the outstanding amount of $1,489,617. The trial judge dismissed the action.

Issues:

(1) Did the trial judge make factual errors in dismissing the appellants’ claim of negligent misrepresentation?

(2) Did the trial judge deny the appellants procedural fairness?

Holding: Appeal dismissed.

Reasoning:

(1) No. Appellate intervention is warranted where an inference of fact is not supported by any evidence and where an improper inference has a material effect on the outcome.

The court stated that while the trial judge’s reasons were admittedly long and occasionally strayed into areas that were not demanding of any commentary, he had a firm grasp of the facts and applied the correct law in analysing the negligent misrepresentation claim.

First, the appellant asserted that the trial judge made a palpable and overriding error in finding that Sparkasse and TM Germany sent the December correspondence understanding that it would be relied upon by RCI’s bank rather than RCI. The court stated that this was an overstatement of the trial judge’s finding.  The trial judge described the wording of RCI’s email request as odd and then proceeded to describe some of its features.  He did so from an objective perspective, stating that, when referring to RCI’s bank’s “requirement”, the clear implication “to an objective reader” was that RCI needed something to show its banker.  This was a reasonable conclusion.

Secondly, the appellants contended that the trial judge erred in finding that RCI deliberately omitted the word “guarantee” in its request. The court stated that it was open to the trial judge to infer that the omission was deliberate.

Third, the appellants submitted that the trial judge erred in finding that RCI was not concerned about transferring the purchase order to TM Canada because it knew that Getrag was contractually obliged to indemnify TM Canada for its payment obligations. The court stated that although the trial judge’s reference to an indemnity was not grounded in the evidence, it was not a palpable and overriding error.

(2) No. The appellants complained that the trial judge made an “atmospheric error” by characterizing Osim and his request as dishonest, guileful, and misleading – a narrative that was not advanced by the parties, was untethered from the evidence, and which improperly coloured his treatment of the correspondence and his analysis of the issues.

The court stated that the trial judge’s interpretation of the evidence was supported by the pleadings. In any event, RCI clearly did not request a guarantee and Osim admitted that he did not use the word guarantee in the email.  As such, the court held that the trial judge fairly concluded that this was a deliberate decision, and there was no denial of procedural fairness.

Connelly v. Toronto (Police Services Board), 2018 ONCA 368

[MacFarland, LaForme and Epstein JJ.A.]

Counsel:

C Fiske and D Cassin, for the appellants

F Fischer and A Mintoff, for the respondent

Keywords: Torts, Negligent Investigation, Duty of Care, Police, Wellington v. Ontario, 2011 ONCA 274, Hill v. Hamilton-Wentworth (Regional Municipality) Police Services Board, 2007 SCC 41, Civil Procedure, Striking Pleadings, No Reasonable Cause of Action,  Rules of Civil Procedure, Rule 21

Facts:

Pursuant to Rule 21, the motion judge struck out the appellants’ (Connellys’) claim, without leave to amend, on the basis that it did not disclose a reasonable cause of action. The motion judge found it was plain and obvious that the Toronto Police Services Board (TPSB) owed no duty of care to the appellants.

At the outset of the appeal, counsel for the appellants accepted that the Court of Appeal is precluded from reconsidering the decision of Wellington v. Ontario, 2011 ONCA 274. Instead, they argued that Wellington should be distinguished because the facts in the appellants’ case are uniquely different. In Wellington, the Court of Appeal held that the Special Investigation Unit (“SIU”) of the Ministry of the Attorney General does not owe a private law duty of care to victims and their families in conducting investigations of police officers. Rather, the SIU’s duty is to the public at large.

Issues:

(1) Is this case distinguishable from Wellington on the basis that the appellants do not have rights to certain remedies for victims of crimes identified in paragraph 53 of Wellington?

(2) Is this case distinguishable from Wellington on the basis that the appellants were actively assisting the police in the conduct of the investigation?

Holding: Appeal dismissed.

Reasoning:

(1) No. At paragraph 53 in Wellington, the court merely made closing obiter dicta comments to illustrate that concerned family members of victims of crime often have rights to certain remedies.

(2) No. Regarding the appellants’ claim in connection with their assistance of the police with their investigation, this consisted of their providing reasons to the police for their desired outcome of the investigation. It did not create any special relationship with the police that converted the duty of care the police owe to the public into a private duty of care to the appellants.

Despite the appellants’ attempts to characterize their claim as novel, their claim of negligence against the police is not. The law is clear. The police do not owe them a duty of care as the family members of a victim of a potential crime. As the motion judge correctly concluded, it is a category that has already been considered and rejected: see Hill v. Hamilton-Wentworth (Regional Municipality) Police Services Board, 2007 SCC 41 at paragraphs 27 and 45.

Ojeikere v. Ojeikere, 2018 ONCA 372

[Laskin, Feldman and Miller JJ.A.]

Counsel:

Atinuke Taibat Ojeikere, acting in person

J Long of the Office of the Children’s Lawyer, for the children

S Maiato, for the respondent

Keywords: Family Law, Custody and Access, Child Abduction, Jurisdiction, Children’s Law Reform Act, R.S.O. 1990, c. C.12, ss. 22-23, Best Interests of the Child, Habitual Residence, Risk of Serious Harm, H.E. v. M.M., 2015 ONCA 813, Convention on the Civil Aspects of International Child Abduction, Article 13(b), Fresh Evidence, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 134(b)

Facts:

The respondent, Mr. Ojeikere, contends – and the motion judge found – that a Nigerian court has jurisdiction to decide who should have custody of, and access to, the Ojeikeres’ three adolescent children. The appellant, Mrs. Ojeikere, and the Office of the Children’s Lawyer (“OCL”) both contend that an Ontario court has jurisdiction. This case is not governed by the Convention on the Civil Aspects of International Child Abduction, 25 October 1980, Can. T.S. 1983 No. 35, 19 I.L.M. 1501 (entered into force December 1, 1983), commonly known as The Hague Convention, because Nigeria is not a signatory to the Convention. Thus, the issues on this appeal must be decided under the provisions of Ontario’s Children’s Law Reform Act, R.S.O. 1990, c. C.12 (“CLRA”).

Issues:

(1) Did the motion judge err in ruling that under s. 22 of the CLRA an Ontario court does not have jurisdiction?

(2) Despite s. 22 of the CLRA, should an Ontario court exercise jurisdiction under s. 23 of the CLRA because the three children are physically present in Ontario and would suffer serious harm if returned to Nigeria?

Holding: Appeal allowed.

Reasoning:

Laskin J.A.:

(1) No. The motion judge did not err. Section 22 gives an Ontario court two bases to assume jurisdiction and make a custody order: habitual residence of the child in Ontario; or physical presence of the child in Ontario, as long as the other specified requirements of the section are met.

Under s. 22(1)(a) of the CLRA, “a court shall only exercise its jurisdiction to make an order for custody of or access to a child where the child is habitually resident in Ontario at the commencement of the application for the order”. The OCL concedes that the Ojeikeres’ three children were habitually resident in Nigeria before Mrs. Ojeikere wrongfully took them to Mississauga in August 2016. The OCL also concedes that Mrs. Ojeikere could not change the children’s place of habitual residence by abducting them. The Court of Appeal agreed with the OCL’s concessions. The Ojeikeres’ three children resided with their parents in Nigeria for the five years preceding the court applications. Thus, the children were habitually resident in Nigeria under s. 22(2)(a) of the CLRA. Because the trial judge found that the three Ojeikere children were habitually resident in Nigeria, despite their time in boarding schools and despite their abduction to Ontario, s. 22(1)(a) of the CLRA provides no basis for an Ontario court to assume jurisdiction over the children.

Paragraph 22(1)(b) of the CLRA provides that an Ontario court may assume jurisdiction if six criteria are met. An Ontario court can only exercise jurisdiction under this provision if all six of the enumerated criteria are met. When Mrs. Ojeikere brought her application in Ontario in November 2016, the three children were physically present in Ontario, thus satisfying the first criterion under s. 22(1)(b). The fourth criterion is also satisfied as an Ontario court has not recognized any extra-provincial custody order; indeed none has been made. The OCL put forward evidence to try to satisfy the second, fifth, and sixth criteria: best interests, real and substantial connection, and balance of convenience. Even accepting that the evidence satisfies these three criteria, s. 22(1)(b) affords no basis for an Ontario court to assume jurisdiction because the third criterion cannot be satisfied. An Ontario court cannot assume jurisdiction to make a custody order if at the time of the application in Ontario, an application for custody was pending in another place where the child is habitually resident. In other words, a party cannot ask an Ontario court to assume jurisdiction to avoid proceedings already started elsewhere. Mr. Ojeikere filed a petition for custody of the three children in Abuja, Nigeria three months before Mrs. Ojeikere brought her application in Ontario. At the time Mr. Ojeikere filed his petition, the three children were habitually resident in Abuja. Thus, s. 22(1)(b)(iii) stands as a bar to an Ontario court’s jurisdiction.

(2) Yes. Section 23 allows for an Ontario court to assume jurisdiction even if the requirements of section 22 are not met, and it is under that provision that the appeal should be allowed.  Despite the motion judge’s conclusion on s. 22, an Ontario court should exercise jurisdiction because the children, who are physically present in Ontario, would suffer serious harm if returned to Nigeria. The question whether Mr. and Mrs. Ojeikere’s three children would suffer serious harm if they were ordered to return to Nigeria turned almost entirely on the fresh evidence filed on the appeal by the OCL. This evidence was filed in accordance with the order of Miller J.A. The evidence consists of the affidavit of Andrea Jones, an in-house clinician at the OCL, and numerous school records for each of the three children. Under s. 134(4)(b) of the Courts of Justice Act, R.S.O. 1990, c. C.43, in a civil (or family law) appeal, this court “may, in a proper case … receive further evidence”. The fresh evidence was permitted to allow the court to have up-to-date information about the child and the child’s best interests.

Justice Weiler commented on s. 23 in her reasons in H.E. v. M.M., 2015 ONCA 813, 393 DLR (4th) 267. Because the provision is triggered when a child is physically present in Ontario even if the child has been wrongfully brought to this province, s. 23 can override s. 22. Section 22’s aim of discouraging child abduction becomes secondary to s. 23’s aim of preventing serious harm to the child. As Weiler J.A. wrote at para. 87: “[W]hen there is a risk of serious harm to the child, the aim of discouraging child abduction must yield to another purpose of the CLRA, namely, the best interests of the child.” Courts appear largely to have equated the standard of “serious harm” in s. 23 of the CLRA with the standard of “grave risk [of] expos[ing] the child to physical or psychological harm or otherwise plac[ing] the child in an intolerable situation” in art. 13(b) of The Hague Convention. However, the Court of Appeal in this case concluded that the standard of “serious harm” required by s. 23 of the CLRA is less stringent than the standard under art. 13(b) of the Convention.

As important as the meaning of “serious harm” are the factors relevant to its application. Under s. 23, an Ontario court has discretion to refuse to order a child’s return to the child’s place of habitual residence. That discretion should be structured by a list of relevant factors. The relevant factors will vary from case to case. In some cases, one factor may decisively show “serious harm”; in other cases a combination of relevant factors may do so. In this case, a combination of factors, taken together, give rise to a risk that the three children would suffer serious harm if they are required to return to Nigeria. The factors relied on in this case are particular to its facts, and should not be taken as a list of factors relevant to every s. 23 case.  For determining “serious harm” for the Ojeikeres’ three children, the potentially relevant factors include:

(i) The risk of physical harm

(ii) The risk of psychological harm

(iii) The views of the children

(iv) Mrs. Ojeikere’s claim she will not return to Nigeria even if the children are required to do so

With respect to the first factor, since Mrs. Ojeikere might not return with the children to Nigeria, or at least not full-time, an order returning them to Nigeria must contemplate a return to their father’s care.  The likelihood that the children would be physically disciplined with objects by their father if returned to his care in Nigeria is high. The likely severity of the harm is at least moderately high. This factor alone weighs heavily in support of a finding of serious harm.

With respect to the second and third factors, the children would likely suffer serious psychological and emotional harm if now forced to return to Nigeria against their will. Overall, the fresh evidence shows that there is a real risk the children would experience a serious letdown in their hopes and aspirations for their futures if, over their objections, they were ordered to return to Nigeria. They would feel angry, sad, and resentful at once again having their lives disrupted.

With respect to the fourth factor, the Court of Appeal gave it no weight. There may be cases where a parent’s refusal to accompany the children back to the country of habitual residence could give rise to a serious risk of harm to the children. This case is not one of them. Mrs. Ojeikere lived in Nigeria for five years before abducting the children. Her vague assertion that there is nothing for her in Nigeria does not establish a substantial reason for refusing to return there.

On the basis of the fresh evidence, the Court of Appeal found that on a balance of probabilities, the three children would suffer serious harm if now ordered to return to Nigeria to await a custody and access determination in the Nigerian courts. This conclusion rests principally on the risk of physical harm in the form of physical discipline with objects compounded by the risk of psychological harm arising from these adolescent children’s mature views and objections to returning to Nigeria.

B.W. Miller J.A. (Concurring):

Justice Laskin considered the risks of both physical and psychological harm to the Ojeikere children. He concluded that the risk of physical harm in this case “alone weighs heavily in support of a finding of serious harm.” Justice Miller agreed. But while Justice Laskin rested his conclusion “principally on the risk of physical harm in the form of physical discipline with objects”, he added that the serious harm in this case is “compounded by the risk of psychological harm arising from these adolescent children’s mature views and objections to returning to Nigeria”. Justice Miller did not agree with this secondary argument. What Laskin J.A. characterized as psychological harm is mere disappointment. Disappointment is not harm, let alone serious harm.

Moreover, Laskin J.A. suggested that the threshold for “serious harm” under the CLRA is lower than for the harm override contained in the Hague Convention. This is a novel argument, and was not advanced by either party or the OCL. Accordingly, the court did not have the benefit of any submissions on the point. Indeed, the OCL took the position that the serious harm standard in the CLRA is equivalent to the standard in the Hague Convention. It would be inappropriate to adopt a new interpretation of the CLRA in these circumstances.

Nevertheless, there is the risk of serious harm from physical mistreatment from their father. The father is not accustomed to living with the children, is easily angered by them, and has a history of striking them with objects when angry. This establishes a serious risk of harm should the children be returned. On this basis alone, the jurisdictional override is engaged and Ontario should exercise jurisdiction to determine custody of and access to the Ojeikere children.

Atos IT Solutions v. Sapient Canada Inc., 2018 ONCA 374

[Simmons, Brown and Fairburn JJ.A.]

Counsel:

Mark Gelowitz, Alexander Cobb and Evan Thomas, for the appellant

Peter H. Griffin, Paul-Erik Veel and Laurel D. Hogg, for the respondents

Keywords: Contracts, Breach of Contract, Damages, Minimum Performance Principle, Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, Duty of Good Faith and Honest Performance, Bhasin v. Hrynew, 2014 SCC 71, Agribrands Purina Canada Inc. v. Kasamekas, 2011 ONCA 460, Contract Interpretation, Standard of Review, Palpable and Overriding Error, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Commercial Absurdity, Exclusion Clauses, Tercon  Contractors Ltd. v. British Columbia (Ministry of Transportation and Highways), 2010 SCC 4

Facts:

The appellant was awarded a contract with Enbridge Gas Distribution Inc. to set up a new IT platform. The appellant subcontracted with the predecessor of the respondent to provide two services for the project. The installation of the software began on June 2007 but was not completed until September 2009; that is, five months behind schedule. On June 29, 2009, the appellant terminated the subcontract with the respondent for cause. The respondent sued claiming damages for wrongful termination of the subcontract. At trial, the respondent was awarded $6,291,680 plus $3.1 million in costs. The appellant appeals aspects of the damages awarded to the respondent.

Issues:

(1) Did the trial judge err by failing to apply the minimum performance principle set out in Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, in respect of the data conversion services portion of the parties’ contract?

(2) Did the trial judge err in not properly interpreting a formula in the data conversion services portion of the contract?

(3) Did the trial judge err in misinterpreting a limitation of damages clause as it applied to application management support services?

Holding: Appeal allowed, in part.

Reasoning:

(1) Yes. Under the subcontract, the appellant was allowed to terminate the contract either “for cause” or “for convenience”.  Although the appellant had invoked the termination “for cause” provision of the subcontract, pursuant to Open Window Bakery, it was entitled to the benefit of the less burdensome mode of performance of the subcontract offered by the termination “for convenience” clause.

Although the expectancy principle governs the calculation of compensatory damages which are the usual measure of damages for breach of contract, the “minimum performance principle” places a common law limit on the expectancy principle. In cases where the defaulting party has alternative modes of performing the contract, damages are calculated on the basis of the mode of performance that is least burdensome to the defaulting party and least profitable to the non-breaching party. The termination for convenience clause effectively defined the upper limit of the respondent’s liability for damages. The damages were therefore reduced from $6,291,680 to $4,947,405.

The application of the minimum performance principle does not depend upon good faith conduct by the breaching party as set out in Agribrands Purina Canada Inc. v. Kasamekas, 2011 ONCA 460. Bhasin v. Hrynew, 2014 SCC 71 did not change this law as it did not purport to alter the existing principles concerning the proper measure of expectation damages in the event of a breach of contract.

(2) No. The interpretation of the phrase “for the last milestone preceding the termination” in clause 17.4 of the subcontract raises a question of mixed fact and law and the trial judge’s interpretation is entitled to deference. The interpretive principle of commercial efficacy and its corollary, avoiding interpretations that result in a commercial absurdity, are tools used by courts to give accurate meaning to the parties’ intentions as stated in a contract. In this case, the trial judge’s reasons disclose that he was attentive to the plain language of the clause, the provisions of the subcontract as a whole and the factual matrix from which the subcontract emerged. Given those circumstances, little ground remained on which the appellant can erect an argument based on the trial judge’s interpretation given rise to commercial absurdity.

(3) No. The trial judge followed the test set out in Tercon Contractors Ltd. v. British Columbia (Ministry of Transportation and Highways), 2010 SCC 4, and first considered whether the exclusion clause would even apply to the circumstances. The trial judge concluded that the limitation of liability clause did not apply to the damages for loss of profit on this subcontract. The limitation of liability clause only excluded indirect loss of profits (ie. on other work or contracts). The trial judge gave a considered, detailed and context-sensitive explanation about how he arrived at his interpretation of this clause and his analysis is not marked by a rare extricable error of law or palpable and overriding errors of facts. For this reason, his decision should on this issue should stand.

Watto v. Immigration Consultants of Canada Regulatory Council, 2018 ONCA 376

[MacFarland, LaForme and Epstein JJ.A.]

Counsel:

W J Macintosh, for the appellant

N M Leon, for the respondent

Keywords: Corporations, Not-for-Profit Corporations, Oppression, Canada Not-ForProfit Corporation Act, SC 2009, C. 23, Limitation Periods, Limitations Act, 2002, S.O. 2002, C. 24

Facts:

The appellant is a member of the respondent not-for-profit corporation. In 2013, the appellant unsuccessfully campaigned to be elected to the Board of Directors of the respondent. Statements the appellant made during his campaign have spawned a number of legal proceedings between the appellant and respondent. Effective May 22, 2014, the respondent amended bylaw 2016-1 (the “Bylaw”) to provide that no member involved in litigation with the Board would be eligible for nomination, election or appointment to the Board.

The appellant has challenged the Bylaw in a number of ways, the most recent being this application under s. 253 of the Canada Not-For-Profit Corporations Act, S.C. 2009 C. 23, for a declaration that the Bylaw is oppressive, unfairly prejudicial, and unfairly disregards his interests as a member of the respondent. The applications judge dismissed the application as out of time pursuant to the Limitations Act, 2002, S.O. 2002, C. 24.

Issues:

(1) Did the applications judge err in dismissing the claim as being out of time?

Holding:

Appeal dismissed.

Reasoning:

(1) On appeal, the appellant argued that the application judge erred in concluding that he did not have the power to postpone the upcoming election for the respondent’s Board of Directors. The appellant claimed that this order would have given him time to adduce further evidence on the application. The appellant did not file transcripts of the proceeding and instead relied on an affidavit he swore in January. The affidavit is not evidence that the application judge refused to make such an order. Moreover, the application judge noted in his reasons that the appellant was content to proceed with his argument on the record before the court. There was no error or unfairness in the application judge’s decision to proceed with the application and determine the limitations issue on the basis of the record before him. The appeal was therefore dismissed.

Winter v. Sherman Estate, 2018 ONCA 379

Counsel:

Bradley Teplitsky, for the moving parties

Katherine L. Kay, for the responding parties

Kevin Donovan, in person for the intervener Toronto Star Newspapers Ltd.

Keywords: Civil Procedure, Sealing Orders, Solicitor-Client Privilege, Personal Health Information, Sierra Club v. Canada (Minister of Finance), 2002 SCC 41, Litigation Guardians

Facts:

The moving parties, who are two of the appellants in this appeal, have brought a motion for:

(i) an order appointing the Office of the Public Guardian and Trustee (the “OPGT”) as litigation guardian for the third appellant, KW;

(ii) if necessary, an order requiring KW to attend for a mental examination by a health practitioner;

(iii) in the alternative, an order removing Bradley Teplitsky as counsel of record for KW;

(iv) an order extending the time to perfect the appeal; and

(v) an order that the evidence filed on the motion concerning KW’s mental health be treated as confidential, sealed, and not form part of the public record.

On the return date, the moving parties sought to protect the confidentiality of certain information contained in the affidavits and Exhibit A to the March Affidavit. KW and the OPGT did not attend. Mr. Teplitsky advised the court that KW supported the motion, and that the OPGT was taking no position.

Issues: The moving parties raise two confidentiality concerns in respect of the affidavits of KW:

(1) Should passages that disclose solicitor-client communications between KW and Mr. Teplitsky be removed or redacted?

(2) Should passages of the affidavits that disclose personal information about KW’s mental health, confided for the purpose of seeking the appointment of a litigation guardian, be removed or redacted?

(3) Should a confidentiality order be issued?

Holding: Motion granted, in part.

Reasoning:

The Test

A sealing or confidentiality order should only be granted when the following test has been met (Sierra Club v. Canada (Minister of Finance), 2002 SCC 41):

(a) such an order is necessary in order to prevent a serious risk to an important interest, in the context of litigation, because reasonable alternative measures will not prevent the risk (the “necessity” branch); and

(b) the salutary effects of the order, including the effects on the right of civil litigants to a fair trial, outweigh its deleterious effects, including the effects on the right to free expression which includes the public interest in open and accessible court proceedings (the “proportionality” branch).

The court must consider whether something less than a sealing or confidentiality order would be sufficient in the circumstances and, if such an order is made, must ensure that it is not overly broad.

(1) Solicitor-Client Communications:  Yes. Mr. Teplitsky identified certain passages that he asked the court to redact for all purposes. He advises that the moving parties will not be relying on such evidence in support of the motion to appoint a litigation guardian for KW. The respondents and the intervener agreed to the redactions of solicitor-client communications on this basis. They asked the court, however, to exercise appropriate caution in redacting only narrowly-defined, actual solicitor-client communications.

Solicitor-client communications are routinely protected from disclosure in litigation, including in particular solicitors’ affidavits for removal from the record and in support of an order to appoint a litigation guardian. Redaction or expungement of confidential information from the court record for all purposes can be a reasonable alternative. That is what Mr. Teplitsky was requesting in connection with the passages in the affidavits covered by solicitor-client privilege.

(2) Personal Health Information: Yes. The request being made was not to expunge the information from the court record, but to protect it from disclosure. The moving parties sought to rely on this information in support of the motion for a litigation guardian, but they did not want any of it disclosed to the public, or even to the respondents or the respondents’ counsel.

The first branch of the test, referred to as the “necessity” branch, requires the risk to the interest sought to be protected by the confidentiality order to be real and substantial. The risk must be “well-grounded in the evidence” and pose a serious threat to the interest in question. The interest cannot be merely specific to the party requesting the confidentiality order, but “one which can be expressed in terms of a public interest in confidentiality”.

The issue to be determined is the person’s capacity at the time the order is considered. In this case, KW has consented to an assessment to determine whether he “is unable to understand information relevant to making a decision in respect to an issue or issues in the appeal or is unable to appreciate the reasonably foreseeable consequences of a decision or lack of decision”. The focus of the assessment is on whether KW currently has capacity to participate in the appeal and to instruct counsel. As such, the court need not rely on what JW states in her February Affidavit about her knowledge of KW’s medical history and past diagnosis. This information can be redacted or expunged for all purposes, as a reasonable alternative to a confidentiality order.

(3) Confidentiality Order: No. It is relevant as observational evidence from someone who knows the litigant well, and the court was not satisfied on the evidence in this case that the moving parties have discharged their burden in respect of the “necessity” part of the test for the protection of such evidence. The passages in question consist of JW’s personal observations of her brother-in-law and inform her opinion as a layperson that he is under a disability and requires a litigation guardian. They do not contain any diagnosis or any other opinion of a medical practitioner, nor do they refer to communications between KW and a medical practitioner, which might give rise to more specific confidentiality concerns.

The references to the appellant, JB’s health and KB’s affidavit are unnecessary and irrelevant to the motion for the appointment of a litigation guardian for KW.

The court directed that certain portions of certain affidavits  be redacted and no longer form part of the court record in the litigation, on the motion or for any other purpose.

Auciello v. CIBC Mortgages Inc., 2018 ONCA 377

[Pepall, Roberts and Miller JJ.A.]

Counsel:

Vito Auciello, acting in person

Onofrio Ferlisi, for the respondent CIBC Mortgages Inc. previously carrying on business as 3877337 Canada Inc.

Amanda Jackson, for the respondent Home Trust Company

Keywords: Real Property, Commercial Lending, Mortgages, Commitment Letters, Conditions, Appraisals, Breach of Contract, Negligence, Bad Faith, Civil Procedure, Summary Judgment, Adjournments

Facts:

The appellant appeals from the order of C. Brown J., granting summary judgment to the respondents and dismissing the appellant’s action against them. The respondent, CIBC Mortgages Inc., previously carrying on business as 3877337 Canada Inc. (“387”), is a mortgage broker that arranges mortgages for clients with financial institutions. The appellant advised 387’s representative that he wished to refinance adjoining commercial properties, which he believed to be worth $1.2 million, with a new first mortgage of $600,000. 387’s representative suggested Home Trust Company (“Home Trust”) as a potentially suitable lender but indicated that a property appraisal would be required. Subsequently, the appellant advised 387’s representative that the properties were owned by Network Cash Mart Ltd. (“Network”). Ultimately, the appellant executed a Home Trust mortgage commitment letter in Network’s name as mortgagor and his name as guarantor. The commitment was subject to certain conditions, including an appraisal reflecting a minimum property value of $1.2 million.

The first appraiser advised that a $1.2 million was unrealistic but did not compile an appraisal report. The motion judge found that this was a courtesy to the prospective mortgagor so that it would not be charged for an appraisal report that did not meet the commitment requirement. A second appraiser also declined to complete an appraisal because the valuation was unrealistic.

To assist the appellant, Home Trust asked the first appraiser to complete an appraisal report. The appraisal confirmed an as-is value of $600,000 and a value if complete of $665,000. Based on this appraisal, Home Trust provided a new commitment for mortgage financing of $390,000, subject to certain conditions. The appellant did not accept the new commitment. The first commitment’s $1.2 million appraisal condition remained unfulfilled, and the financing did not proceed.

The appellant then commenced proceedings against 387 and Home Trust for breach of contract and various other causes of action. Among other things, he alleged that they mishandled the appraisal process, caused undue delay, and failed to act in good faith. The motion judge concluded that the appellant had no cause of action as the property was owned by a corporation and not by the appellant, and in any event, no damages were caused by the respondents.

Issues:

(1) Did the motion judge err in not granting the self-represented party an adjournment?

(2) Did the motion judge err in her finding relating to the value of the property, and determining the appellant failed to prove any damages?

Held: Appeal dismissed.

Reasoning:

(1) No. An adjournment would have made no difference to the outcome, and in any event, none was requested of the motion judge.

(2) No. There was no reliable evidence that the property had a value of $1.2 million or that the appraised value of $600,000 was wrong. In this regard, it was open to the motion judge to discount the MLS posting prepared and posted by the appellant as being self-serving. Fundamentally, the property did not have an appraised value of $1.2 million, and as such, no mortgage financing was available.

As the motion judge concluded, there was no obligation on the part of either respondent to secure the amount of the loan sought by the appellant. The evidence revealed no act or omission by the respondents that caused any loss or damages. The motion judge properly concluded that there was no genuine issue requiring a trial.

MacIvor v. Pitney Bowes, 2018 ONCA 381

[MacFarland, Huscroft and Nordheimer JJ.A.]

Counsel:

Jeffrey Strype and Mark De Sanctis, for the appellant

Gordon Jermane and Veronica Mohan, for the respondent

Keywords: Contracts, Policies of Insurance, Interpretation, Coverage, Long Term Disability, Standard of Review, Correctness, Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co., 2016 SCC 37, Timely Notice of Claim, Relief from Forfeiture, Insurance Act, R.S.O. 1990, c. I.8, Courts of Justice Act, R.S.O. 1990, c. C.43

Facts:

This is an appeal from a trial judgment holding that the appellant, Lenard MacIvor, as a former employee of Pitney Bowes, had no coverage for his claim under the long term disability policy of the Manufacturers Life Insurance Company (the “Manulife Policy”).

The appellant suffered a traumatic brain injury and a severe back injury during a company sponsored event in Costa Rica on April 16, 2005. He was unaware of the permanent and disabling nature of his brain injury until after he had resigned his employment with Pitney Bowes on August 11, 2008. Within days he took up employment with Samsung to perform a role similar to the one he held at Pitney Bowes before his accident. However, the difficulties he had experienced in job performance before leaving Pitney Bowes soon became apparent and he was fired from Samsung in August 2009.

It is apparent from the medical evidence that the appellant was, for a long time, unaware of the seriousness of his brain injury and in particular the permanent nature of that disability.

The parties agree the appellant meets the qualification for disability benefits as set out in the Manulife Policy. The respondent agrees that it received sufficient notice of the claim in April 2005.

The respondent argues however, that: “[h]e had access to [Long Term Disability] benefits if he applied while he was employed and, therefore, covered. Once he was outside of this coverage and/or failed to meet the Policy’s terms, he no longer had entitlement to claim”; and that “[t]he policy indicates that coverage ends when employment ends.”

The trial judge accepted this argument and dismissed the claim for coverage for LTD benefits.

Issues:

(1) Is the appellant, as a former employee of Pitney Bowes, entitled to coverage under the Manulife Policy?

(2) Did the appellant submit timely proof of his claim?

(3) Does the one-year contractual limitation period in the policy bar the appellant’s claim?

Holding: Appeal allowed.

Reasoning:

As a preliminary note, the standard of review of a standard form insurance policy is correctness: Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co., 2016 SCC 37.

(1) Yes. The respondent’s position was that the Manulife Policy provides for coverage only during employment and that coverage ended when the appellant resigned from his position on August 11, 2008.

The Court held that the language of the Manulife Policy when considered as a whole is clear; it means only that coverage does not continue when an employee begins working for another employer or after the employee has retired. The “Termination of Coverage” language relates to future claims, not claims that may have arisen during the course of the employee’s employment. In other words, if an employee’s claim arises as the result of an occurrence that takes place during their employment, the policy provides coverage. The additional words “unless continuation of coverage is provided under the Extension of Coverage provision” supported this conclusion.

(2) Yes.  The policy required that proof of claim be filed “within 90 days of the date benefits would begin”. Benefits would begin only when an employee was no longer receiving employment income. The appellant’s proof of claim was filed September 9, 2010. Based on the date of termination and the package that the appellant received from Samsung, the proof of claim was provided some 10 days after the required 90-day contractual period.

The Court held that it would be unfair to permit the imperfect compliance with the 90-day contractual period to defeat the appellant’s claim in the particular circumstances of this case. The appellant was injured during his employment when he was covered by a Long Term Disability policy, but did not appreciate the significance of his injury during his employment. His employer and the insurer were aware that he had suffered a serious injury that included a brain injury at the outset. Therefore, the court held that it was in the interests of justice to grant relief from forfeiture in this case under the Insurance Act, R.S.O. 1990, c. I.8 or the Courts of Justice Act, R.S.O. 1990, c. C.43, even though such relief was not specifically requested.

(3) No. The respondent alternatively relied on the one-year limitation period set out in the Manulife Policy to say that, in any event, the claim was out of time. Even on the appellant’s evidence, he became aware of his ability to claim in August 2009. Accordingly, if the one-year contractual limitation period began tolling on that date, the claim issued in April 2011 is out of time. The court rejected this argument. It is arguably unclear whether the policy language required the appellant to commence his action within one year of November 1, 2010, the date that Manulife denied the claim, or whether the one-year period ran from September 9, 2010, the actual date the proof of claim was submitted. Because the statement of claim was issued on April 11, 2011, the court held that it was not necessary to resolve that question because regardless of how the one-year contractual period was to be calculated, it was in time on the facts of this case.

Osmond v. Watkins, 2018 ONCA 386  

[Benotto, Brown and Miller JJ.A.]

Counsel:

D D’Urzo, for the appellant

D Zulianello, for the respondents

Keywords: Torts, Negligence, Occupier’s Liability, Occupiers’ Liability Act, R.S.O. 1990, c. O.2, s. 3(1), Mahe v. Boulianne, 2010 ABCA 32, Summary Judgment

Facts:

The respondents, Christopher and Jasmine Watkins, hired the appellant, Tony Osmond, to complete the construction of a two-story front porch at their residence. The appellant fell from the roof of the porch while performing the work and was seriously injured. The appellant sued the respondents alleging negligence, breach of duty of care, and breach of their duty under s. 3(1) of the Occupiers’ Liability Act, R.S.O. 1990, c. O.2, to “take such care as in all the circumstances of the case is reasonable to see that persons entering on the premises, and the property brought on the premises by those persons are reasonably safe while on the premises.” His primary allegation was that the respondent homeowners, as the occupier of the premises on which the construction work was performed, were negligent in failing to provide him with safety equipment. The respondents moved for and obtained summary judgment dismissing the appellant’s action. The appellant appeals.

Issues:

(1) Did the motion judge err in concluding that there were no genuine issues requiring a trial?

Holding: Appeal dismissed.

Reasoning:

(1) No. The motion judge adopted, as the applicable standard of care in the circumstances, that stated by the Alberta Court of Appeal in Mahe v. Boulianne, 2010 ABCA 32, at paras. 11, 12 and 15. The appellant does not submit the motion judge erred in adopting those principles, nor does he point to any other case that sets a different standard of care for such circumstances. Rather, the appellant contends the motion judge made two fact-related errors: (i) he determined the case in the face of contested material facts; and (ii) he made palpable and overriding errors of fact. The errors, according to the appellant, relate to the issue of whether the appellant or the respondents controlled and directed the renovation work.

The Court of Appeal was not persuaded by the appellant’s submissions. The motion judge made several key findings of fact: (i) there was no evidence the appellant’s fall was caused by any defect in or lack of repair affecting the premises or any hazardous conditions associated with the premises themselves; (ii) there was no dispute the appellant was performing the renovation work for valuable consideration; (iii) there was no basis for a contractual claim that the respondents had failed to furnish the appellant with safety equipment; (iv) there was no evidence the appellant was inexperienced in performing roofing work or working at heights; and (v) the evidence did not support a finding that the respondents were aware the appellant lacked the necessary experience to carry out the project. The appellant did not persuade the Court that any of those key findings amounted to a palpable and overriding error of fact or required a full trial before they could be made. Accordingly, the motion judge did not err in deciding the case by way of a summary judgment motion.

Walsh Energy Inc. v. Better Business Bureau of Ottawa-Hull Incorporated, 2018 ONCA 383

[Hoy A.C.J.O., Huscroft and Paciocco JJ.A.]

Counsel:

David Sherriff-Scott and Karen Perron, for the appellants

John H. Yach, for the respondent

Keywords: Torts, Defamation, Libel, Defences, Fair Comment, Costs, Reasonableness

Facts:

The respondent companies, Walsh Energy Inc. (“Walsh”) and Waltek Energy Services Inc. (“Waltek”), both controlled by the same person, brought an action against the Better Business Bureau (BBB) in defamation. In 2007, the BBB changed Walsh’s website rating from “satisfactory” to “unsatisfactory”. In January 2009 the BBB adopted a new rating system which generated a grade of “B” for Waltek and “D-“ for Walsh and posted these grades on the BBB website. Walsh and Waltek sued the BBB claiming that the grades posted on the BBB website caused substantial damages. At trial, the judge found that the postings were not defamatory.

The companies appealed to the Divisional Court. Waltek abandoned its appeal prior to the hearing. The Divisional court allowed Walsh’s appeal concluding that the “D-“ grade was defamatory and ordered a new trial on the issues of fair comment, malice and damages. BBB appealed. Walsh cross-appealed, arguing that a new trial was not necessary and the factual record allowed an appellate court to decide all the issues.

Issues:

(1) Did the Divisional Court err in determining that the impugned publication was defamatory?

(2) Did the Divisional Court err in ordering a new trial on the issue of fair comment?

(3) Should the trial judge’s award of partial indemnity costs in the amount of $348,135.96 be set aside?

Holding:

Appeal allowed. Cross-appeal allowed, in part.

Reasoning:

(1) No. The Divisional Court properly concluded that the trial judge erred in principle by failing to make a finding as to the plain and ordinary meaning of the grade. The focus of the trial judge’s analysis was on the context in which the grade was assigned and its connection to the prior “unsatisfactory” rating Walsh received. The context in which words are used is relevant to determining meaning. But it need not be established that an impugned statement is worse than prior statements made by a defendant in order for that statement to be defamatory. The plain and ordinary meaning must also be considered. It was open to the Divisional Court to find that the plain and ordinary meaning of the “D-“ grade the BBB assigned to Walsh was defamatory.

(2) Yes. As per WIC Radio v. Simpson, 2008 SCC 40, a defendant claiming fair comment must satisfy the following test: the comment must be on a matter of public interest; the comment must be based on fact; the comment, though it can include inferences of fact, must be recognisable as comment; the comment must satisfy the objective test that any person could honestly express that opinion on the proved facts. The plaintiff can defeat this defence if it proves that the defendant was actuated by express malice. It was open to the Divisional Court to determine whether the fair comment defence was satisfied on the record before it and the court ought to have done so rather than remit the matter for new trial.

The issue of determining whether there was a factual basis for the BBB’s opinion is not so complex that it requires a new trial. The factual basis for the opinion is clearly set out in the record: that Walsh refused to address a customer’s complaint through BBB mediation.

The issue of whether a person could honestly express the opinion can also be resolved without a trial. The requirement that the opinion could be honestly held does not require to assess whether the comment is a reasonable and proportional response to the stated or understood facts. It cannot be said that no one could honestly hold the opinion that a grade of “D-“ is not appropriate based on the proved facts.

The D- grade was an opinion that could honestly have been expressed on the proved facts. Put another way, it cannot be said that no one could honestly hold that opinion. This was sufficient to satisfy, in the general terms required, the fourth branch of the fair comment test. Accordingly, there was no reason to remit the matter for new trial. The fair comment defence was established.

The finding of the trial judge that there was no malice must be upheld because the trial judge correctly stated the applicable test and considered arguments of the parties. The trial judge reached a conclusion that was open to him on the record.

The main appeal by BBB was therefore allowed, the main cross-appeal by Walsh was dismissed, and the trial judge’s order dismissing the action was restored.

(3) Yes. The court should set aside a costs award on appeal only if the trial judge has made an error in principle or if the costs award is plainly wrong: Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, [2004] 1 S.C.R. 303, at para. 27. As the court held in Boucher v. Public Accountants Council for the Province of Ontario (2004) 71 O.R. (3d) 291 at para. 37, the overriding principle in assessing costs is the reasonableness of the costs award: “[t]he failure to refer, in assessing costs, to the overriding principle of reasonableness, can produce a result that is contrary to the fundamental objective of access to justice.” The assessment of costs is not purely mathematical exercise, but should reflect what is fair and reasonable in all of the circumstances: Clarington (Municipality) v. Blue Circle Canada Inc., 2009 ONCA 722 at para. 52

The costs awarded by the trial judge are considerable in the context of a defamation action. They are also grossly disproportionate to the costs incurred by the appellant in bringing this action. Counsel for the BBB billed over three times as many hours in defending this action as the appellant’s counsel billed in bringing it. Walsh could not reasonably have expected that it would be faced with costs award of this magnitude. The trial judge failed to consider the fairness and reasonableness of the costs awarded and did not provide an adequate justification for the striking disparity in the costs incurred by the parties. The result is a costs award that is contrary to the fundamental objective of access to justice. The cross-appeal on costs was allowed and the costs were reduced by roughly half, from $348,135.96 to $175,000.

Short Civil Decisions

Mitchell v. Banik, 2018 ONCA 370

[Pepall, Roberts and Miller JJ.A.]

Counsel:

Joanna Weiss, for the appellant

David Litwin and Nada Nicola-Howorth, for the respondent

Keywords: Endorsement, Adjournment

B2B Bank v. Hails, 2018 ONCA 380

[Benotto, Brown and Miller JJ.A.]

Counsel:

Darrell George Hails, acting in person

Cristina Internicola, for the respondent

Keywords: Real Property, Mortgages, Summary Judgment, Fresh Evidence

Godstone Co-Ownership Inc. v. Maple Ridge Real Estate Investments Corp., 2018 ONCA 378

[Pepall, Pardu and Miller JJ.A.]

Counsel:

Joseph J. Neal, for the appellant

Catherine Francis, for the respondent DUCA Financial Services Credit Union Ltd.

Sean Dewart and Brett Hughes, for Martin Rumack

Keywords: Civil Procedure, Limitation Periods

Cana International Distributing Inc. v. Standard Innovation Corporation, 2018 ONCA 387

[Laskin, Sharpe and Fairburn JJ.A.]

Counsel:

Shaun Laubman and Laura M. Wagner, for the appellants

Peter Mantas and Tala Khoury, for the respondent

Keywords: Costs

Priest v. Reilly, 2018 ONCA 389

[MacFarland, LaForme and Epstein JJ.A.]

Counsel:

Paul Duncan Reilly, acting in person

Kathryn A. Junger, for the respondent

Keywords: Family Law, Spousal Support, Child Support, Jurisdiction, Family Law Act, R.S.O. 1990, c. F.3, Courts of Justice Act, R.S.O. 1990, c. C.43, Christodoulou v. Christodoulou, 2010 ONCA 93

Criminal Decisions

R v. McDonald, 2018 ONCA 369

[Doherty, LaForme and Paciocco JJ.A.]

Counsel:

Erin Dann and Dan Stein, for the appellant

Amy Alyea, for the respondent

Keywords: Criminal Law, Sexual Assault, Unlawful Confinement, Uttering a Death Threat, Sentencing, Dangerous Offender, Canadian Charter of Rights and Freedoms, ss. 7 and 11(d), Criminal Code, ss. 650(1), 686, 758(1), R. v. Caine, 2003 SCC 74, Charkaoui v. Canada (Citizenship and Immigration), 2007 SCC 9, Baker v. Canada (Minister of Citizenship & Immigration), [1999] 2 S.C.R. 817, R. v. Boutilier, 2017 SCC 64, R. v. Kankis, 2012 ONSC 378, R. v. Johnson, 2003 SCC 46

R v. Williams, 2018 ONCA 367

[Hoy A.C.J.O., MacPherson and Juriansz JJ.A.]

Counsel:

Robert Sheppard, for the appellant

Peter M. Campbell, for the respondent

Keywords: Criminal Law, Drug Trafficking, Unlicensed Possession of a Firearm, Sentencing

R v. Benjamin, 2018 ONCA 385

[Feldman, Roberts and Trotter JJ.A.]

Counsel:

Mark Halfyard, for the appellant

Matthew Asma, for the respondent

Keywords: Criminal Law, Aggravated Assault, Assault with a Weapon, Sentencing

R v. Boutros, 2018 ONCA 375

[Doherty, Rouleau and Miller JJ.A.]  

Counsel:

Scott C. Hutchison and Ben Rogers, for the appellant

R.W. Hubbard, for the respondent

Keywords: Criminal Law, Robbery, Evidence, Admissibility, Text Messages, Canadian Charter of Rights and Freedoms, ss. 10 & 24, Criminal Code, s. 487, Telus Communications Company v. The Queen, 2013 SCC 16, R. v. Jones, 2017 SCC 60, R. v. Spencer, 2014 SCC 43, R. v. Pino, 2016 ONCA 389, R. v. Wittwer, 2008 SCC 33, R. v. Harris, 2007 ONCA 574, R. v. Grant, 2009 SCC 32

R v. C.R.A., 2018 ONCA 388

[Benotto, Roberts and Trotter JJ.A.]

Counsel:

Gerri Wiebe, for the appellant

Kevin Rawluk, for the respondent

Keywords: Criminal Law, Sexual Assault

R v. Zoldi, 2018 ONCA 384

[Laskin, Trotter and Fairburn JJ.A.]

Counsel:

Lance C. Beechener and Alexander M. Ostroff, for the appellant

Shawn Porter, for the respondent

Keywords: Criminal Law, Murder, Jury Charge, Criminal Code, ss. 21, 229, & 686, R. v. Moo, 2009 ONCA 645, R. v. Martineau, [1990] 2 S.C.R. 633, R. v. Cooper, [1993] 1 S.C.R. 146, R. v. McIntyre, 2012 ONCA 356, R. v. Daley, 2007 SCC 53, R. v. S.(W.D.), [1994] 3 S.C.R. 521, R. v. Jaw, 2009 SCC 42

Ontario Review Board Decisions

Amini (Re), 2018 ONCA 373

[Watt, Brown and Huscroft JJ.A.]

Counsel:

Anita Szigeti, for the appellant Ali Amini

Susan Magotiaux, for the respondent the Attorney General of Ontario

Gavin S. MacKenzie, for the respondent Person-in-Charge, Centre for Addiction and Mental Health

Keywords: Criminal Law, Mental Disorder, CAMH, Threat to Public Safety, Winko v. British Columbia (Forensic Psychiatric Institute), [1999] 2 S.C.R. 625

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ONTARIO COURT OF APPEAL SUMMARIES (APRIL 9 – APRIL 13, 2018 )

Good evening,

I hope everyone is surviving the freezing rain storm!

In Nodel v. Stewart Title Guaranty Company, 2018 ONCA 341, the title insurer, Stewart Title, sought to avoid coverage for a mortgage fraud on the basis of an exclusion that purported to exclude coverage for funds that were “paid to any person other than the registered title holder.” The mortgage funds were delivered to the title holder’s lawyer in trust, rather than the title holder himself (as in every mortgage transaction), and the title insurer had denied coverage on that basis. LawPro settled with the plaintiff on behalf of the lawyers involved, and brought the motion for coverage against Stewart Title. The Court of Appeal sensibly held that the exclusion did not apply, as payment of the funds to the title holder’s lawyer was the same thing as paying them to the title holder directly.

In Wallbridge v. Brunning, the Court of Appeal held that whether a law firm can be vicariously liable for defamatory statements made by a lawyer who practices “in association” with it (as opposed to being an associate employed by the law firm or a partner of the law firm), is an issue of general importance that should be determined at a trial and not on a motion for summary judgment. It therefore set aside the motion judge’s order dismissing the action against the law firm.

Other topics covered this week included several wills and estates matters, wrongful dismissal, family law (custody and abduction), limitation periods and some procedural matters.

John Polyzogopoulos

Blaney McMurtry LLP

jpolyzogopoulos@blaney.com

Tel: 416 593 2953

Table of Contents

Oza v. Oza, 2018 ONCA 360

Keywords: Wills and Estates, Proceeds of Life Insurance Policies, Revocable Beneficiaries

 Zafar v. Saiyid, 2018 ONCA 352

Keywords: Family Law, Custody and Access, Child Abduction, Best Interests of the Child, Convention on the Civil Aspects of International Child Abduction, Articles 12, 13(b), Children’s Law Reform Act, R.S.O. 1990, c. C.12., s. 46(2)

Cunningham v. Hutchings, 2018 ONCA 365

Keywords: Civil Procedure, Representation by Lawyer, Orders, Remedy for Breach, Setting Aside, Motions, Notice, Rules of Civil Procedure, Rule 15.04, Rule 37.14

Aloe v. Aloe, 2018 ONCA 358

Keywords: Wills and Estates, Civil Procedure, Orders, Contempt, Varying Orders, Limitation Periods, Reasonable Apprehension of Bias, Trustee Act, R.S.O. 1990, c. T.23, s. 38(3), Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, Limitations Act, R.S.O. 1990, c. L.15, Rules of Civil Procedure, Rule 59

Singer v. Nordstring Equipment Limited, 2018 ONCA 364

Keywords: Employment Law, Wrongful Dismissal, Damages, Payment in Lieu of Notice, Reasonable Notice Period, Bonus, Benefits

Turcotte v. Lewis, 2018 ONCA 359

Keywords: Torts, Assault, Negligence, Standard of Care, Summary Judgment, Rules of Civil Procedure, Rule 20.05

Wallbridge v. Brunning, 2018 ONCA 363

Keywords: Torts, Defamation, Partnerships, Vicarious Liability, Lawyers Practicing in Association, Summary Judgment

Nodel v. Stewart Title Guaranty Company, 2018 ONCA 341

Keywords: Contracts, Title Insurance, Coverage, Mortgage Fraud,Contractual Interpretation, Ambiguity, Contra Proferentem, Cabell v. The Personal Insurance Company, 2011 ONCA 105

Lucky Star Developments Inc. v. ABSA Canada International, 2018 ONCA 346

Keywords: Civil Procedure, Amending Pleadings, Limitation Periods, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, ss.4, Special Circumstances, Joseph v. Paramount Canada’s Wonderland, 2008 ONCA 469

A.H. v. S.B., 2018 ONCA 347

Keywords: Family Law, Custody, Evidence, Admissibility, Hearsay, Surreptitious Recordings, Voir Dire

Fenn v. McCabe, 2018 ONCA 329

Keywords: Civil Procedure, Appeals, Dismissal for Delay, Motions, Adjournments

Seguin v. Pearson, 2018 ONCA 355 

Keywords: Wills and Estates, Inter Vivos Transfers, Undue Influence, Burden of Proof, Presumption of Undue Influence, Banton v. Banton (1998), 164 D.L.R. (4th) 176, Testamentary Gifts, , Vout v. Hay, [1995] 2 S.C.R. 876, Neuberger v. York, 2016 ONCA 191, Costs, Whether Payable by Estate

For Short Civil Decisions click here

For Criminal Decisions click here

For Ontario Review Board Decisions click here

Civil Decisions

Oza v. Oza, 2018 ONCA 360

[Pepall, Roberts and Miller JJ.A.]

Counsel:

M Todd, for the appellant

I Vacaru and R Godard, for the respondent, Prema Oza

Keywords: Wills and Estates, Proceeds of Life Insurance Policies, Revocable Beneficiaries

Facts:

The appellant appeals from the order declaring that life insurance proceeds from his deceased father’s life insurance policy are payable to his father’s estate. The appellant’s father died on November 13, 2013. The appellant is the sole trustee of his father’s estate. He and his three siblings (who are respondents in the application) are the sole beneficiaries under their father’s will. The life insurance policy in issue was originally issued by Metropolitan Life Insurance Company in the names of the appellant’s mother and father. The appellant’s mother passed away on August 14, 1998. On August 31, 1998, his father changed the beneficiary designation under the insurance policy to the appellant. The form indicates that the father made the appellant a revocable beneficiary.  Metropolitan Life was subsequently acquired by Sun Life Assurance Company of Canada, and a new Sun Life policy number was assigned to the policy issued to the appellant’s parents. On January 30, 2006, the appellant’s father signed a Sun Life Assignment Policy Absolute in the presence of Alan Berger, his insurance agent. The Assignment provides that it has the effect of cancelling all previous beneficiary designations. The appellant was not present and was unaware of the meeting or the Assignment until after his father’s death when Mr. Berger advised him that the effect of the Assignment was that the proceeds under the life insurance policy would go to his father’s estate.

Issues:

(1) Did the motion judge err in failing to declare that the appellant was entitled to the proceeds under his father’s life insurance policy?

Holding:

Appeal dismissed.

Reasoning:

(1) No.The motion judge properly concluded that by executing the Assignment on January 30, 2006, the deceased father intended that the estate be the beneficiary of his life insurance policy. The Assignment was signed by the deceased in the presence of Mr. Berger, his insurance agent, and it provided that by signing, the deceased confirmed that “all previous revocable beneficiary … appointments are cancelled.” The appeal was therefore dismissed.

 Zafar v. Saiyid, 2018 ONCA 352

[Strathy C.J.O., Roberts and Paciocco JJ.A.]

Counsel:

Anser Farooq, for the appellant

Robert McQueen, for the respondent

Keywords: Family Law, Custody and Access, Child Abduction, Best Interests of the Child, Convention on the Civil Aspects of International Child Abduction, Articles 12, 13(b), Children’s Law Reform Act, R.S.O. 1990, c. C.12., s. 46(2)

Facts:

The appeal relates to the orders of the application judge requiring the appellant mother to return the parties’ children to their habitual residence in England for custody and access to be determined there. The orders were made pursuant to Article 12 of the Convention on the Civil Aspects of International Child Abduction (“Hague Convention”), as incorporated in s. 46(2) of the Children’s Law Reform Act.

Under Article 12 of the Hague Convention, where the court determines that a child has been wrongfully removed or retained, the court shall order the return of the child forthwith. The appellant filed fresh evidence on appeal about the current status of the children and of proceedings she has started in England.

Issue:

(1) Did the application judge err in awarding custody to the respondent as a consequence of the mother’s breach of his order?

(2) Did the application judge err in ordering the appellant to return to England with the children?

(3) Did the application judge err in declining to assess whether the grave risk of harm override provision in Article 13(b) of the Hague Convention was engaged?

Holding: Appeal allowed.

Reasoning:

(1) Yes. To award custody of the children to one parent as a consequence of the other parent’s failure to obey a court order is an error, as it fails to consider or prioritize the children’s best interests.

(2) Yes. To the extent that he did so, the application judge was without jurisdiction to order the appellant to return to England with her children.

(3) Yes. The application judge erred in stating that he could not determine whether the children were at grave risk of serious harm and then delegating this matter to the English courts. Article 13(b) of the Hague Convention requires the court to consider the possibility of grave risk of physical or psychological harm to the children arising from an order returning them to their country of habitual residence.

The appellant argued before the application judge that “the threatening, abusive and intolerable behaviour towards the [mother] by the [father], and drinking and smoking habits of the [father] reflects inability to create a safe environment free of danger for the children”. She further submitted that if the children are ordered to return to England she would have to return with them and she would be returning to a dangerous situation. The appellant alleges that the respondent is physically abusive, verbally abusive, and financially controlling. The respondent denied these allegations.

A grave risk of harm to a child’s mother can establish a risk to the child as well. The Court of Appeal found that it was an error for the application judge to explicitly decline to decide whether he believed allegations that, if believed, could engage the protective function of the court to decline to order the children’s return. Having found that the issue of risk could not be determined on the existing record of conflicting affidavit evidence, it was incumbent on the application judge to consider whether oral evidence was required to allow him to complete his risk analysis or whether he could make a decision based on the sufficiency of the record and the appellant’s evidentiary onus. He erred in doing neither and instead delegating the risk assessment to the English courts.

The Court awarded no costs of either the application below or the appeal.

Cunningham v. Hutchings, 2018 ONCA 365

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

Counsel:

Bryan Fromstein and A. Fabio Longo, for the appellant

Nawaz Tahir and Evan Banks, for the respondent Deanna E. Walsh

Keywords: Civil Procedure, Representation by Lawyer, Orders, Remedy for Breach, Setting Aside, Motions, Notice, Rules of Civil Procedure, Rule 15.04, Rule 37.14

Facts:

The appellant appeals the order of Gordon J., which dismissed her action for failure to file either a notice of appointment of counsel or of an intention to act in person within 30 days of the order of Reily J. removing her former lawyer. The appellant also appeals the order of Flynn J., who heard the appellant’s original motion to set aside Gordon J.’s order, but dismissed it on the basis that the proper route was to appeal Gordon J.’s order.

Issue:

(1) Should the order dismissing the appellant’s action be set aside?

(2) Should the second order dismissing the appellant’s motion to set aside the dismissal order be set aside?

Held: Appeal allowed.

Reasoning:

(1) Yes. The order of Reilly J. was deficient in that it did not include the text of rules 15.04(8) and (9) of the Rules of Civil Procedure, as required by r. 15.04(4). The importance of those provisions in an order removing a solicitor cannot be overstated. The obvious purpose is to bring home to the now unrepresented litigant the fact that she is required to give notice to the court and other parties to the litigation that she has either appointed alternate counsel or will be acting in person and that failure to do so can result in the court dismissing her proceeding or striking out her defence. Further, the appellant, who did not appear before Gordon J., had not been served with the respondent’s motion in accordance with the Rules.

Gordon J. gave no reasons for his order and it cannot be ascertained why he ordered the most draconian remedy available in the circumstances. Accordingly, his order cannot stand. His order was set aside and substituted with an order that the appellant’s action shall be dismissed if she fails to file a notice of appointment of counsel within 14 days.

(2) Yes. When the appellant learned of Gordon J.’s order she promptly moved before Flynn J. under r. 37.14 to set it aside, on the basis that she failed to appear through insufficient notice. Flynn J. concluded that her recourse was to appeal Gordon J.’s order to the Court of Appeal and dismissed her motion. It is unclear from Flynn J.’s reasons that he grappled with the threshold issue of insufficient notice within the meaning of r. 37.14. It was open to him to have granted the relief sought by the appellant. Accordingly, Flynn J.’s order is set aside.         

Aloe v. Aloe, 2018 ONCA 358

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

Counsel:

Valve Elisabeth Aloe-Gunnell, acting in person

William R. Scott, for the respondents Lembit Peter Aloe, Toomas Erki Aloe, Alo Lumber and Building Supplies Limited, John Alo Developments Limited and Alo Construction Company Limited

Keywords: Wills and Estates, Civil Procedure, Orders, Contempt, Varying Orders, Limitation Periods, Reasonable Apprehension of Bias, Trustee Act, R.S.O. 1990, c. T.23, s. 38(3), Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, Limitations Act, R.S.O. 1990, c. L.15, Rules of Civil Procedure, Rule 59

Facts:

 These appeals arise in the context of long-standing litigation commenced by the appellant in respect of the business interests, bank accounts and real property of the estate of her father, Valdeko Aloe.

In 2011, the parties signed Minutes of Settlement that were incorporated into a final order of Koke J. on March 11, 2011 (the “Final Order”). Among other things, the Final Order provided for a portion of certain real property in New York to be deeded to the appellant, after severance. Shortly after the Final Order, Ms. Aloe-Gunnell repudiated the settlement after asserting that the defendants had misrepresented the value of her share of the New York property. The parties have been unable to successfully implement the Final Order since that time, and there have been multiple court attendances.

In January 2015, Varpio J. found the appellant in contempt of court after she brought proceedings in New York with respect to the New York property. The motion judge found the appellant had breached the Final Order by commencing such proceedings because Koke J. had seized himself of the matter and para. 17 of the Final Order required only Koke J. to sign further final orders flowing from the minutes of settlement. By order dated February 13, 2015, Varpio J. imposed a penalty for contempt, and prohibited the appellant from taking any further steps in the proceeding or in any related proceeding in Ontario or any other jurisdiction, without leave of the court. The appellant did not appeal the contempt order.

Three subsequent orders are the subject of the present appeals.

The first is an appeal from the order of Varpio J. dated October 27, 2016. The appellant moved under rule 59 of the Rules of Civil Procedure to vary para. 17 of the Final Order, arguing that there had been a mistake or slip in including this term in the order. Varpio J. dismissed the motion to vary the order ab initio, finding it was an attempt by the appellant to avoid the earlier finding that she was in contempt of the Final Order.

The second appeal is from the order of Gareau J. dated December 13, 2016, dismissing the appellant’s motion for leave to commence a new action against the respondents. The proposed action related to one or more Swiss bank accounts of the appellant’s deceased father. The motion judge concluded that, because of the passage of time, the action would be tantamount to an abuse of process and that, in any event, the claims were statute-barred.

The third appeal is from the order of Varpio J. dated March 9, 2017, that dismissed a motion by the appellant for his recusal and for transfer of the proceedings to Toronto.

Issues:

(1) Did the motion judge err in finding that the para. 17 issue was an attempt to re-litigate matters already decided?

(2) Did the motion judge err in refusing the appellant’s request for leave to commence a new action against the respondents?

(3) Did the motion judge err in law in refusing to recuse himself due to a reasonable apprehension of bias?

Holding: Appeals dismissed.

Reasoning: 

(1) No. There was no apparent purpose to the appellant’s attempt to vary para. 17 of the Final Order, other than to challenge the basis for the prior contempt finding (which the appellant confirmed in her oral argument to the court remained her objective). The motion judge properly concluded that this was an attempt to undermine the contempt finding, which was not appealed, and to re-litigate a settled matter.

(2) No. The appellant was required to obtain leave to commence any proceeding against the respondents, pursuant to the February 13, 2015 order of Varpio J. Justice Gareau properly denied leave when the claims could not possibly succeed because of the expiry of limitation periods. The claims the appellant seeks to litigate, which she acknowledged having discovered in November 2002, are barred by the operation of one or more of s. 38(3) of the Trustee Act, R.S.O. 1990, c. T.23, the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, and the old Limitations Act, R.S.O. 1990, c. L.15.

(3) No. The motion judge carefully considered the various statements referred to by the appellant, and explained why, when such statements were considered in context, there was no air of reality to the bias claim. The refusal to transfer the proceedings was based on a proper exercise of the motion judge’s discretion after he considered the balance of convenience to the parties. Accordingly there was no basis to interfere.

Singer v. Nordstring Equipment Limited, 2018 ONCA 364

[Feldman and Benotto JJ.A. and Sachs J. (ad hoc)]

Counsel:

Jeff C. Hopkins and Kristen Pennington, for the appellant/respondent by way of cross-appeal

Gerald Griffiths, for the respondent/appellant by way of cross-appeal

Keywords: Employment Law, Wrongful Dismissal, Damages, Payment in Lieu of Notice, Reasonable Notice Period, Bonus, Benefits

Facts:

The respondent terminated the appellant’s employment as President and General Manager without just cause. The appellant was 51 years old at the time, and had been employed by respondent for 11 years; 4 years as President.

The appellant had brought a motion for summary judgment to determine issues of reasonable notice, loss of bonus for the 2016 year he had worked, loss of bonus during notice period and loss of benefits during notice period.

Motion judge awarded appellant 17 months’ salary in lieu of reasonable notice and an amount for his 2016 bonus.

The appellant appeals the dismissal of his claim for his bonus and benefits during the 17-month period of reasonable notice. The respondent cross-appeals from the award of 17 months’ reasonable notice, saying it should be between 12 and 15 months and from the award of a bonus for 2016.

Issues:

(1) Did the motion judge overemphasize one of the Bardal factors, character of employment, and underemphasize the other factors?

(2) Did the motion judge err in awarding the appellant’s claim for his 2016 bonus?

(3) Did the motion judge err in denying the appellant’s claim for his benefit package during the notice period?

(4) Did the motion judge err in denying the appellant’s claim for bonus during the notice period?

Holding:

Appeal allowed. Cross-appeal dismissed.

Reasoning:

(1) No. The motion judge was alive to this issue. He instructed himself to assess reasonable notice in a “holistic manner” without giving disproportionate weight to one factor. The motion judge considered Fisher v. Hirtz, 2016 ONSC 4768, which explained that a longer notice period is generally justified for older, long term employees who are at a competitive disadvantage in securing new employment. He also referred to Day v. JCB Excavators Ltd., 2011 ONSC 6848, which had comparable facts and which set the reasonable notice period at 17 months.

(2) No. The respondent’s argument that the appellant was underperforming was rejected by the motion judge because the respondent never communicated this to the appellant and did not cite this in his termination letter. The respondent attempted to make this same argument on appeal. The respondent failed to identify any error of law or palpable and overriding error of fact by the motion judge.

(3) Yes. The motion judge erred in law by accepting the respondent’s argument that the appellant must prove that he suffered a loss to make out this claim. The law in Ontario on the issue of benefits was settled by the Court of Appeal in Davidson v. Allelix Inc. (1991), 7 O.R. (3d) 581 (CA), wherein the court stated that a wrongfully dismissed employee may claim, in addition to lost salary, the pecuniary value of lost benefits flowing from such dismissal. The recovery of lost income is not limited to salary. Other income items such as benefits should be included.

(4) Yes. The motion judge failed in not applying the two-part test set out by the Court of Appeal in Pacquette v. TeraGo Networks Inc., 2016 ONCA 618. The bonus was an integral part of the appellant’s compensation package and there was nothing in the language of the bonus plan that would limit that right over the notice period.

Turcotte v. Lewis, 2018 ONCA 359

[Strathy C.J.O., Juriansz and Huscroft JJ.A.]

Counsel:

Anita W.H. Wong and Scott Hawryliw, for the appellants

Roger H. Chown and Marie Hynes, for the respondents

First Student Canada and David Ribble

Andrew A. Evangelista and Justine Ajandi, for the respondents, Ryan Zaroski and 1853780 Ontario Inc. o/a Kee to Bala

Keywords: Torts, Assault, Negligence, Standard of Care, Summary Judgment, Rules of Civil Procedure, Rule 20.05

Facts:

Ryan Turcotte (“Turcotte”) and his parents appeal the dismissal of their action against the respondents on two motions for summary judgment. Turcotte attended “resort night” at the Kee to Bala bar (the “Kee”), operated by the respondent 1853780 Ontario Inc. He returned to Barrie early the next morning on a bus chartered by the Kee from the respondent First Student Canada (“First Student”), and driven by the respondent David Ribble (“Ribble”). The respondent, Ryan Zaroski (“Zaroski”), was hired by the Kee as a security guard at the bar and on the bus.

The defendants, Aaron Lewis and Courtney Lewis, are cousins. Aaron Lewis was a passenger on the bus. At some point before the bus arrived in Barrie, Aaron Lewis contacted Courtney to ask him to meet the bus at its drop-off point. Almost immediately after he stepped off the bus, Turcotte was allegedly assaulted by Aaron Lewis, Courtney Lewis and other unknown assailants. He sustained a serious head injury. He sued Aaron Lewis, Courtney Lewis and the respondents. He claimed that the assault was foreseeable and that the respondents had failed to take reasonable care to prevent it.

The respondents, First Student and Ribble, brought a motion for summary judgment to dismiss the claims against them. The Kee and Zaroski brought a second motion for summary judgment for the same purpose. The motions were heard together. There were two issues on the motions. First, whether the case was suitable for disposition by summary judgment. The motions judge held it was. Second, whether the moving parties, the respondents on this appeal, had met the applicable standards of care. The motion judge held they had. She granted their motions, dismissing the action against all the moving parties.

Issue:

(1) Did the motion judge err in concluding that this was an appropriate case for summary judgment?

(2) Did the motion judge err in her assessment of the standard of care?

Holding: Appeal allowed.

Reasoning:

(1) No. The appellants did not tender expert evidence on the standard of care, nor did they seek an adjournment of the motions to obtain either expert evidence or a police report. They agreed to the motion judge presiding on the motions, even though she had conducted the criminal trial. The motion judge’s conclusion that the case was suitable for summary judgment is entitled to deference.

(2) Yes. The motion judge significantly understated the standard of care. The Kee operated a bar, which catered to a large number of youthful patrons. It provided transportation, through the services of First Student, so that its patrons could drink without driving. The Kee provided security, at the bar and on the bus, to address the foreseeable risk of violence between patrons. The individual respondents, Ribble and Zaroski, were part of the transportation and security system and were trained in their respective responsibilities to deal with foreseeable risks, including the risks posed by unruly or violent passengers. The motion judge’s abbreviated assessment of the standard of care led her to understate the means available to the respondents to avoid putting Turcotte in the midst of a dangerous environment or to take measures to protect him when he did get off the bus.

While the motion judge said that she accepted the evidence most favourable to the appellants, she never precisely articulated what evidence that was. Nor did she resolve inconsistencies in the evidence. The factual underpinnings of her analysis are not known. For these reasons, a trial was necessary. The judge trying the matter will be entitled to give pre-trial directions pursuant to Rules 20.05(1) and (2) to ensure the just, expeditious and efficient determination of the proceeding on its merits.

Wallbridge v. Brunning, 2018 ONCA 363

[Juriansz, Lauwers & Miller JJ.A.]

Counsel:

Geoffrey D.E. Adair, Q.C., for the appellants

Michael R. Kestenberg, for the respondents

Keywords: Torts, Defamation, Partnerships, Vicarious Liability, Lawyers Practicing in Association, Summary Judgment

Facts:

The appellant Wallbridge is a partnership of lawyers. The respondents are Williams Litigation Lawyers and Faye Brunning, a lawyer who practices “in association” at Williams Litigation. Brunning’s practice is separate from that of Williams, but she shares the same office address, telephone number, fax number and front desk receptionist. She pays Williams a monthly rental fee for the space and facilities she uses in Williams’ office. Williams authorized Brunning to use its letterhead described below, without supervision. Williams’ letterhead references Brunning as “Practicing in Association, not in Partnership”. In particular, Brunning’s name is listed with other lawyers’ names in the header of the letterhead with an asterisk beside her name. She is the only lawyer listed in the header of the letterhead with an asterisk. The footer of the letterhead lists Brunning’s name again and all of her contact information. Similarly, Brunning’s email signature indicates that she is “Practicing in Association with Williams”. Williams’ website includes a photo of Brunning, along with photos of the Williams lawyers under the titles “Our Lawyers” and “Meet Our Team”. The other lawyers are identified as Counsel, Partner or Associate. Brunning is identified as “Lawyer, Practicing in Association”.

Wallbridge issued a statement of claim alleging that Brunning made a series of defamatory comments, misrepresentations and allegations about or directed at Wallbridge related to their representation of former Indian Residential School (IRS) students. Wallbridge named Williams as a defendant claiming that Williams was vicariously liable for the defamatory comments, misrepresentations and allegations of Brunning. Williams had no knowledge of the allegedly defamatory correspondence written and sent by Brunning in respect of the IRS claims. Williams brought a motion for summary judgment seeking dismissal of the action as against it. In resisting the motion, Wallbridge filed no affidavits, but did file a letter from Williams’ counsel.

On motion for summary judgment Williams raised two issues. First, Williams argued Wallbridge had not filed the correspondence alleged to be defamatory, and so had failed to put its best foot forward. Second, Williams argued that since the evidence established Brunning was never an employee, agent or partner of Williams and was never held out to be the same, there was no basis upon which it could be found vicariously liable. The motion judge granted summary judgment on the second issue, deciding that Williams could not be vicariously liable for Brunning’s allegedly defamatory correspondence. She found it unnecessary to deal with the first issue.

Issues:

(1) Was the appellant required to provide evidence of defamation at the motion for summary judgment?

(2) Did the motion judge err in granting summary judgment on the issue of vicarious liability?

Held: Appeal allowed.

Reasoning:

(1) No. There was no denial in Williams’ evidence that Brunning sent the correspondence, and the court knew from having heard another motion in the proceeding that Brunning claimed defences for having written the correspondence. The motion judge was entitled to take judicial notice of what was in the court file, namely, that Brunning conceded writing the correspondence alleged to be defamatory. Had the motion judge dealt with this argument, it would have been properly rejected. Williams defended the action as against it on the basis that it was not liable for any of Brunning’s acts or omissions. Williams’ statement of defence did not deny or otherwise address the paragraphs of the statement of claim that set out Brunning’s allegedly defamatory correspondence. Consistent with this, Williams brought its summary judgment motion solely on the basis that it could not be found to be vicariously liable for that correspondence. Given that Williams’ summary judgment motion was brought solely on the ground of vicarious liability, Wallbridge was only obliged to respond to that issue.

(2) Yes. The question of whether Williams was liable for Brunning’s alleged defamation was without precedent and involved the application of policy rationales. The implications of lawyers “practicing in association” are potentially far-reaching, certainly much wider than the litigants and dispute in this case. It was not in the interests of justice to decide the question on a summary judgment motion, given the importance and novelty of the question and the existence of much evidence supporting the appellant’s position. The question would be better determined on a full evidentiary record, where the factual and legal issues and the consequences of imposing liability on the respondent can be carefully considered.

The motion judge did not attach weight to the fact that the publication of most of the allegedly defamatory correspondence was on the letterhead of the Williams firm. This could reasonably be seen as Williams placing its reputation behind the alleged defamation. Brunning’s use of Williams’ letterhead to send the allegedly defamatory correspondence was fully authorized. Williams granted to Brunning a complete and uncontrolled licence to communicate using its letterhead. In doing so, Williams created the opportunity, and took the risk, Brunning could use its letterhead to publish defamatory material, as it is alleged she did in this case. While the motion judge found Williams never held Brunning out as a “Partner” or “Associate” of the firm, she never considered the import of the fact that Williams held Brunning out as “associated” with it.

The evidence clearly establishes Brunning was associated with Williams. The letterhead and website state that Brunning is not a “Partner”, and they distinguish her from the status of “Associate”. However, the evidence could support a finding that Williams holds Brunning out as a lawyer who is one of “Our Lawyers” and a member of “Our Team”, albeit one who practices in “association” with it. Given the strength of the evidence that could support a finding that Williams should be found liable for Brunning’s allegedly defamatory correspondence, and given the novelty and importance of the question, the motion judge should have refused to grant summary judgment and allowed the matter to proceed to trial.

Nodel v. Stewart Title Guaranty Company, 2018 ONCA 341

[Epstein, Paciocco and Nordheimer JJ.A]

Counsel:

Peter H. Griffin and Danielle Glatt, for the appellant

Gavin J. Tighe, Alexander Melfi, and John A. Campion, for the respondent

Keywords: Contracts, Title Insurance, Coverage, Mortgage Fraud,Contractual Interpretation, Ambiguity, Contra Proferentem, Cabell v. The Personal Insurance Company, 2011 ONCA 105

Facts:

The Respondent, Mr. Karl Nodel, was a private mortgage lender and the victim of a mortgage fraud. He made a claim for his loss under a mortgage insurance policy he had purchased from Stewart Title Guaranty Company (“Stewart Title”).

A man posing as John Colarieti (the borrower) sought a $1,100,000 loan from Mr. Nodel, for investment purposes. Mr. Nodel agreed to lend the money to the borrower, to be secured with a second mortgage on a valuable residential property registered in Mr. Colarieti’s name.

Mr. Nodel hired a lawyer, Mr. Isaac Singer, to arrange mortgage security and to close the transaction. He instructed Mr. Singer to acquire mortgage insurance. Mr. Singer was an “Examining Counsel”, authorized to assist in the purchase of mortgage insurance from Stewart Title. He arranged mortgage insurance from Stewart Title that included coverage for mortgage fraud.

At closing, Mr. Singer paid the mortgage money to the borrower’s lawyer, Mr. Bryan Dale, in trust. After he received the money, Mr. Dale did not transfer the money to his client. Instead he transferred the money to third parties under his client’s direction. The money and the client then disappeared.

At Mr. Nodel’s direction, Mr. Singer made a claim against Stewart Title for coverage under the policy because of the mortgage fraud.  In denying the claim, Stewart Title relied on a coverage exception in the policy that applies if mortgage proceeds are paid to any person other than the registered title holder (“Clause 2”):

  1. Notwithstanding anything else contained within this Policy, in the event the proceeds of the Insured Mortgage are paid to any person or entity other than: i) to the registered title holder … then the Company can deny coverage and shall have no liability to the insured for any matters that involve the allegation of mortgage/title fraud.

Since Mr. Nodel’s lawyer had paid the mortgage proceeds to the borrower’s lawyer, in trust, rather than directly to the borrower, Stewart Title said the exception applied.

Mr. Nodel sued Mr. Singer. Mr. Singer commenced a third party claim against Mr. Dale and Stewart Title. LawPro, the insurer for both lawyers – Mr. Singer and Mr. Dale – settled with Mr. Nodel, and took over the claim against Stewart Title. LawPro and Stewart Title agreed to settle their dispute about insurance coverage through an application by LawPro, in Mr. Nodel’s name, for a declaration that the title insurance provides coverage for the losses incurred. The application judge declared that the exception does not apply, and that the policy does provide coverage. Stewart Title appealed.

Issues

(1)Did the application judge err in finding that Mr. Nodel’s loss was covered by the mortgage insurance policy?

Holding: Appeal dismissed.

Reasoning:

(1) No. The Court held that the application judge was correct.

Stewart Title urged that the application judge erred, in turn, by: (i) failing to give effect to the clear meaning of the exception, and in finding ambiguity by looking at the word “paid” in isolation; (ii) “giving no weight to the factual matrix surrounding how the Policy language operates in practice and in its commercial context” when resolving the ambiguity; and (iii) resorting to contra proferentem reasoning before exhausting other methods of contract construction.

LawPro contended that the application judge’s conclusion was correct. It argued that the words “are paid to” cannot be confined to payment transmitted into the hands of the registered title holder without nullifying coverage under the policy. It agreed that “paid to” is unambiguous, but argues that it is unambiguously a broad enough term to encompass many methods of payment, including payment to the borrower’s trustee. In the alternative, LawPro argues that if Stewart Title’s proposed interpretation was viable and the exception was ambiguous, then that ambiguity must be resolved in favour of coverage, as the application judge did.

The court held that Clause 2 was ambiguous and that there were at least two potential meanings that arose for the language used, in context. Either the exception arises where money is paid beneficially to someone other than the borrower, or where money is handed over or delivered to someone other than the borrower. The court stated that when Clause 2 is interpreted in context, in light of the reasonable expectation of the parties and in a commercially sensible manner, the ambiguity that is created by these complications is resolved. Properly interpreted, that exception is triggered if the proceeds of the mortgage are transferred beneficially to any person or entity other than the borrower in the Insured Mortgage transaction.

Even if the ordinary meaning of Clause 2 does purport to require transmission into the hands of the registered title holder before there will be insurance coverage, which the Court did not accept, Clause 2 could not be given this interpretation. This is because no mortgage fraud occurs where money is transmitted into the hands of the registered title holder. If Clause 2 were to require transmission into the hands of the registered title holder for coverage to apply, the policy would provide no actual mortgage fraud insurance. As a matter of law, an exception clause that results in a policy insuring nothing is nullified: Cabell v. The Personal Insurance Company, 2011 ONCA 105, 104 O.R. (3d) 709, at paras. 1-2.

The court stated that properly interpreted, the exception enabling Stewart Title to deny coverage applies if the proceeds of the mortgage are transferred beneficially to a person or entity other than the borrower in the Insured Mortgage transaction (as defined in the policy). This did not happen here. Instead, the payment was made in trust to the borrower’s lawyer for the benefit of the borrower. It was, in law, a payment to the borrower. Further, payment of mortgage money to a borrower’s lawyer in trust is a routine practice and disqualifying coverage where payment is made to the borrower’s lawyer in trust would not produce a reasonable commercial result.

Thus, the court held that the application judge was correct in declaring that Mr. Nodel’s loss was covered by the mortgage insurance policy.

Nordheimer J.A., in dissent

In dissent, Justice Nordheimer held that the wording of the exception was unambiguous and by its plain terms, it applied to this situation.

The mortgage funds were not handed over or transferred to the registered title holder, or the person everyone assumed was the registered title holder, and thus the funds were not paid in accordance with the terms of the insurance contract. If they had been, and the person posing as the registered title holder had managed to take off with the funds, then undoubtedly Stewart Title would have had to provide coverage (subject to any other defences or claims against others). In this case, however, the mortgage funds were paid in breach of the express terms of the insurance policy. As a result, Stewart Title was entitled, under the terms of its policy, to deny coverage.

Lucky Star Developments Inc. v. ABSA Canada International, 2018 ONCA 346

[Hourigan, Pardu and Huscroft JJ.A.]

Counsel:

Americo Fernandes, for the appellant

Alex Van Kralingen and Mark Repath, for the respondent

Keywords: Civil Procedure, Amending Pleadings, Limitation Periods, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, ss.4, Special Circumstances, Joseph v. Paramount Canada’s Wonderland, 2008 ONCA 469

Facts:

The appellant appeals from the decision of the motion judge permitting it to file a third fresh as amended statement of claim, but precluding it from referring to five prior shipments or claiming damages in respect of those shipments from the respondent freight forwarder. The motion judge found that the limitation period had expired in respect of the five prior shipments and that this constituted a prejudice that could not be compensated, thus barring the amendment.

Issues:

(1) Did the motion judge err by failing to consider that the limitation period applies only to pleadings for unrelated statute-barred claims?

(2) Did the motion judge err by finding that new claims cannot be added to a claim that has already been commenced?

Holding: Appeal dismissed.

Reasoning:

(1) No. The appellant’s argument that containers 1-5 were part of the same claim because they involved breach of the same contract must be rejected. The appellant’s consent to the order striking this portion of the claim under r. 25.11 without leave to amend, on the basis that facts concerning these containers were irrelevant to its claim, is conclusive against this argument. The motion judge found there was no evidence that the parties had agreed to waive the limitation period and no explanation for the appellant having consented to the order, only to attempt to resurrect it over four years later. He properly rejected the argument that special circumstances permitted the addition of a claim to a claim already commenced, citing Joseph v. Paramount Canada’s Wonderland, 2008 ONCA 469, which held that the doctrine of special circumstances no longer exists.

(2) No. The appellant argued that s. 4 of the Limitations Act 2002, S.O. 2002, c. 24, Sched. B does not apply to proceedings that have already been commenced, and so does not bar amendments under r. 26.01. The court disagreed. As the court noted in Joseph, the rules must be read in light of the Act and its purpose in establishing a basic limitation period in s. 4. Amendments adding claims after the limitation period has expired constitute prejudice.

A.H. v. S.B., 2018 ONCA 347

[Hourigan, Pardu and Huscroft JJ.A.]

Counsel:

Ryan M. Kniznik, for the appellant

Marcy Segal, for the respondent

Keywords: Family Law, Custody, Evidence, Admissibility, Hearsay, Surreptitious Recordings, Voir Dire

Facts:

The mother appeals a decision awarding custody to the father. In 2010 the Children’s Aid Society placed the children with the father, taking the position that the children were in need of protection if they continued to reside with their mother. In 2012, the appellant mother signed Minutes of Settlement agreeing that the father’s home would be the principal residence of the children.

Conflict between the parties led them to seek sole custody instead of joint custody, to which they had previously agreed.

Issues:

(1) Did the trial judge err in failing to hold a voir dire to determine whether statements could be admitted on the ground that they were necessary and reliable?

(2) Did the trial judge err in refusing to admit hearsay evidence of statements made by the children?

(3) Did the trial judge err in refusing to admit surreptitious recordings made by the appellant mother of statements made by the children?

(4) Did the trial judge place too much emphasis on the long term status quo?

Holding:

Appeal Dismissed.

Reasoning:

(1) No. The mother had the opportunity to discuss voir dires with duty counsel. At no time during the trial did the mother ask for such a hearing.

(2) No. First, the trial judge’s finding that the mother’s evidence about the statements made by the children was not reliable was amply supported by the record. Second, it was not necessary to hear evidence on the views and preferences of the children other than from the OCL. There was no reason to suspect that the views and preferences of the children were not adequately and properly put before the court.

(3) No. The trial judge was not wrong to not allow the mother to play the tape recording by reason that parents should be discouraged from attempting to obtain evidence from children in this manner. More importantly, all of the necessary evidence about the children’s reaction to an incident involving their father was otherwise before the court.

(4) No. The trial judge’s reasons reflect a thorough and sensitive weighing of the children’s best interests.

Fenn v. McCabe, 2018 ONCA 329

[Pepall, Brown and Trotter JJ.A.]

Counsel:

Robert Fenn, acting in person

M Roefe, for the respondents

Keywords: Civil Procedure, Appeals, Dismissal for Delay, Motions, Adjournments

Facts:

The moving party is self-represented. The Registrar dismissed his appeals for failure to perfect. By order dated December 20, 2017, Nordheimer J.A., sitting as a single judge of the Court of Appeal, declined to set aside the Registrar’s order. He concluded that the moving party had failed to provide any real reason for the delay to perfect, and there was no merit in the appeals. The moving party sought to adjourn his motion to reconsider Nordheimer J.A.’s order. He submitted that he was on pain medication and wished to advance undefined arguments relating to the Canadian Charter of Rights and Freedoms. His request was opposed by the respondents, who are relatives of the moving party.

Issue: Should the moving party’s request to adjourn the motion to reconsider be allowed?

Holding: Motion dismissed.

Reasoning: No. While the Court of Appeal is mindful of the moving party’s health concerns, the draft medical report, filed in support of his request, is from January and therefore dated, and it does not say that there is any impediment to his participation in these proceedings. The moving party had ample opportunity to file adequate materials, did file and serve in person extensive quantities of materials, and could have sought the adjournment at an earlier date. The Court of Appeal found that it would be unfair to the respondents to adjourn this matter. The interests of justice would not be served by an adjournment.

Seguin v. Pearson, 2018 ONCA 355  

[Strathy C.J.O., Roberts and Paciocco JJ.A.]

Counsel:

M L Kropp, for the appellant

L J Tupman, A Bettencourt and J E S Poyser, for the respondent

Keywords: Wills and Estates, Inter Vivos Transfers, Undue Influence, Burden of Proof, Presumption of Undue Influence, Banton v. Banton (1998), 164 D.L.R. (4th) 176, Testamentary Gifts, , Vout v. Hay, [1995] 2 S.C.R. 876, Neuberger v. York, 2016 ONCA 191, Costs, Whether Payable by Estate

Facts:

The appellant, Seguin, appeals from the dismissal of her action to invalidate her father’s two most recent wills, under which the respondent, Pearson, is the principal beneficiary, and to set aside an inter vivos transfer of his house into joint tenancy with the respondent. The trial judge rejected the appellant’s contention that the disposition to the respondent was the product of undue influence. He found, on the basis of “all of the evidence”, that the appellant had failed to prove that the respondent exerted dominance over Mr. Paterson’s will.

Issues:

(1) Did the trial judge err by finding that the respondent had not exercised undue influence over Mr. Paterson?

(2) Did the trial judge err by failing to order that all of the appellant’s trial costs be paid from Mr. Paterson’s estate?

Holding: Appeal and motion for leave to appeal costs dismissed.

Reasoning:

(1) No. The appellant mischaracterized the test for undue influence in the context of testamentary gifts. The rebuttable presumption of undue influence arises only in the context of inter vivos transactions that take place during the grantor’s lifetime. It arises from particular relationships when the validity of inter vivos dispositions or transactions is in issue. Once the presumption is established, the onus shifts to the transferee to rebut the presumption: Banton v. Banton (1998), 164 D.L.R. (4th) 176 (Ont. Ct. (Gen. Div.)), at p. 209.

In the case of wills, it is testamentary undue influence, amounting to outright and overpowering coercion of the testator, which must be considered. The party attacking the will bears the onus of proving undue influence on a balance of probabilities: Vout v. Hay, [1995] 2 S.C.R. 876, at p. 887; see also Neuberger v. York, 2016 ONCA 191, 129 O.R. (3d) 721, at paras. 77-78.

Although the trial judge erroneously conflated the test for undue influence that applies to inter vivos transfers with the relevant test in relation to testamentary gifts, this error did not affect the reasonableness of his conclusions that the respondent exercised no undue influence over Mr. Paterson, and that Mr. Paterson independently decided to make the impugned wills and the transfer of property in favour of the respondent. The trial judge’s finding that there was no undue influence using the inter vivos standard would necessarily be the same had the trial judge applied the correct standard applicable to testamentary dispositions.

(2) No. While acknowledging that he had the discretion to order payment of all of the appellant’s costs from her father’s estate, the trial judge determined that it would be unfair to do so. The appellant was entirely unsuccessful at trial and payment of her costs from the estate would effectively leave the respondent with nothing. The trial judge nevertheless exercised his discretion to order that a part of the appellant’s costs be paid from the estate. There was no error in the trial judge’s discretionary decision, which is entitled to deference. Further, the appellant did not identified any reviewable error in the amount of costs ordered by the trial judge.

Short Civil Decisions

Ding v. Chen, 2018 ONCA 348

[MacPherson, Pepall and Miller JJ.A.]

Counsel:

No one appearing for the appellant

V Pilnitz, for the respondent
Keywords: Appeal Book Endorsement, Failure to Appear

2129152 Ontario Inc. v. Pliamm, 2018 ONCA 338

[Pepall, Brown and Trotter JJ.A]

Counsel:

J Goldblatt and I Graham, for the appellant

T Morgan, for the respondent
Keywords: Appeal Book Endorsement, Real Property, Leases, Torts, Unlawful Act Conspiracy

Carleton Condominium Corporation No. 396 v. Burdet, 2018 ONCA 342

[Hourigan, Pardu and Huscroft JJ.A]

Counsel:

C-A Burdet, for the appellants

G Boyd, for the respondent
Keywords: Appeal Book Endorsement, Condominium Law, Condominium Act, 1998, Rules of Civil Procedure, Rules 59.06(2) and 2.1.02(1)

Weenen v. Biadi, 2018 ONCA 344

[Epstein, Hourigan and Paciocco JJ.A]

Counsel:

S Turney and A Reklitis, for the moving party, Fasken Martineau DuMoulin LLP

Y D Payne, for the responding party, Matthew Weenen
Keywords: Contracts, Solicitor and Client, Solicitor’s Liens, Charging Orders

Kanak v. Riggin, 2018 ONCA 345

[Doherty, van Rensburg and Nordheimer JJ.A]

Counsel:

A Rogerson, for the appellant

J Porter, Q.C., for the respondent

Keywords: Torts, Defamation, Qualified Privilege, Employment Law, Evidence, Hearsay, The Rule in Browne v. Dunn (1893), 6 R. 67, H.L

Mikhail v. Hill, 2018 ONCA 353

[MacPherson, Pepall and Miller JJ.A]

Counsel:

Michael Mikhail, acting in person for the appellants

P Gaglia, for the respondent, Paul Mitchell (C64216)

N Lean, for the respondents, Linda Hill and Paul Mitchell
Keywords: Contracts, Real Property, Mortgages, Guarantees, Default, Notice of Sale

Criminal Decisions

R v. L.H.E., 2018 ONCA 362 (Publication Ban)

[Hoy A.C.J.O., MacPherson and Juriansz JJ.A.]

Counsel:

B Davies and A Burgess, for the appellant

Jennifer Epstein, for the respondent
Keywords: Criminal Law, Sexual Assault, Sexual Exploitation, Sexual Interference, Ineffective Assistance of Counsel, R. v. L.C.T., 2012 ONCA 116

R v. Lewis, 2018 ONCA 351

[Sharpe, Pepall and Fairburn JJ.A.]

Counsel:

M Dineen, for the appellant Courtney Lewis

E Neubauer, for the appellant Aaron Lewis

P Fraser, for the respondent
Keywords: Criminal Law, Assault, Aggravated Assault, Aiding and Abetting, Self-Defence, Jury Instructions, Evidence, Eyewitness Testimony, R. v. M.B., 2017 ONCA 653, Questions from The Jury, R. v. Ellis, 2013 ONCA 9

R v. Mendez, 2018 ONCA 354

[Hoy A.C.J.O. and Simmons and Pardu JJ.A.]

Counsel:

L Beechener, Z Kerbel and S Wickramasinghe, for the appellants

S Magotiaux, for the respondent
Keywords: Criminal Law, First Degree Murder, Aiding and Abetting, Jury Instructions

R v. G.H., 2018 ONCA 349(Publication Ban)

[Feldman and Benotto JJ.A. and Sachs J. (ad hoc)]

Counsel:

M J Venturi, for the appellant

A Hotke, for the respondent
Keywords: Criminal Law, Sexual Assault, Evidence, Collusion, R. v. Perkins, [2007] O.J. No. 3246

R v. Contreras, 2018 ONCA 328

[Feldman and Benotto JJ.A. and Sachs J. (ad hoc)]

Counsel:

R Parker, for the applicant

C Bartlett-Hughes, for the respondent

A Moustacalis, for the appellant
Keywords: Criminal Law, Interveners, Ineffective Assistance of Counsel, R. v. Seaboyer (1986), 50 C.R. (3d) 395, Collateral Issues, Delay, Motion Dismissed

R v. Franchino, 2018 ONCA 350 (Publication Ban)

[Feldman and Benotto JJ.A. and Sachs J. (ad hoc)]

Counsel:

R Litkowski and Jessica Zita, for the appellant

M Flanagan, for the respondent
Keywords: Criminal Law, Administering a Noxious Substance, Administering a Stupefying Substance for the Purpose of Sexual Assault, Sexual Assault, GHB, Circumstantial Evidence, R. v Villaroman, 2016 SCC 33, Sentencing

Ontario Review Board Decisions

Duquette (Re), 2018 ONCA 357

[Feldman and Benotto JJ.A. and Sachs J. (ad hoc)]

Counsel:

D G Duquette, acting in person

S E Fraser, appearing as amicus curiae

P Fraser, for the Ministry of the Attorney General

J Zamprogna, for the Southwest Centre for Forensic Mental Health Care
Keywords: Criminal Law, Not Criminally Responsible, Mental Disorder, Uttering a Threat to Cause Death or Bodily Harm, Threat to Public Safety, Medcof (Re), 2018 ONCA 299

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 (APRIL 2- APRIL 6)

Good evening,

PQ Licensing S.A. v. LPQ Central Canada Inc., a franchise rescission case, was the most interesting decision of the week for several of reasons, none of which have to do with rescission.

First, the decision is the latest in a series of recent examples where the “appropriate means” branch of the discoverability test in section 5(1)(a)(iv) of the Limitations Act, 2002, was employed to delay the discoverability of a claim. In this case, the fact that the franchise agreement required mediation before the arbitration could proceed, resulted in a determination that the commencement of arbitration was not the “appropriate means” to seek a remedy until the completion of the mediation. This resulted in the suspension of the commencement of the limitation period for four years, while the mediation was outstanding.

Second, the Court determined that the standard of review from an arbitrator’s decision on the applicability of the Limitations Act, 2002, was reasonableness, not correctness, even though it involved the application of a statute of general application (the Limitations Act, 2002).

Finally, the decision confirms an arbitrator’s ability to use the “blue pencil” method of severing unenforceable portions of clauses, while keeping the remainder of the clause intact. In this case, the franchise agreement provided for mediation in Delaware. Rather than finding the whole mediation clause unenforceable, the arbitrator simply severed the requirement to mediate in Delaware and enforced the remainder of the clause.

Other topics covered this week included liability for wrongful patent enforcement, the duty to defend in the MVA context, family law (custody and access and breach of court orders), securities class actions, and mortgage enforcement.

Wishing everyone a nice weekend and a Happy Eastern Orthodox Easter to everyone celebrating.

John Polyzogopoulos

Blaney McMurtry LLP

jpolyzogopoulos@blaney.com

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

Tel: 416 593 2953

Table of Contents 

Del Vecchio v. Del Vecchio, 2018 ONCA 334

Keywords: Family Law, Divorce, Support Orders, Orders of the Court, Refusal to Obey, Arrears of Support, Introducing Affidavit Evidence after Expiry of Timelines

Andreevskaia v. Satanovski, 2018 ONCA 330

Keywords: Contracts, Real Property, Mortgages, Defences, Non Est Factum, Duress, Unconscionability, Gifts, Summary Judgment

PQ Licensing S.A. v. LPQ Central Canada Inc., 2018 ONCA 331

Keywords: Contracts, Franchise Agreements, Rescission, Arbitration Clauses, Interpretation, Standard of Review, Reasonableness, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co., 2016 SCC 37, Teal Cedar Products Ltd. v. British Columbia, 2017 SCC 32, Dunsmuir v. New Brunswick, 2008 SCC 9, Enforceability, Illegality, Arthur Wishart Act (Franchise Disclosure), 2000, S.O. 2000, c. 3, s. 10, Severance, “Blue Pencil” Approach, Shafron v. KRG Insurance Brokers (Western) Inc., 2009 SCC 6, 2176693 Ontario Ltd. v. Cora Franchise Group Inc., 2015 ONCA 152, Limitations Periods, Discoverability, “Appropriate Means”, Tolling Agreements, Limitations Act, 2002, S.O. 2002, c. 24, Schedule “B”, s. 5(1)(a)(iv) and 22, 407 ETR Concession Co. v. Day, 2016 ONCA 709

Ernst v. Northbridge Personal Insurance Corporation, 2018 ONCA 339

Keywords: Insurance Law, Coverage, Duty to Defend, Pleadings Rule, Monenco Ltd. v. Commonwealth Insurance Co 2001 SCC 49, Off-Road Vehicles Act, R.S.O. 1990, c. O.4

Apotex Inc. v. Abbott Laboratories Limited, 2018 ONCA 332

Keywords: Intellectual Property, Patents, Pharmaceuticals, Abbreviated New Drug Submissions, Unjust Enrichment, Damages, Patented Medicines (Notice of Compliance) Regulations, SOR/93-133, s. 6, s. 8

Mader v. McCormick, 2018 ONCA 340

Keywords: Family Law, Custody and Access, Appointment of Counsel for the Children, United Nations Convention on the Rights of the Child, Articles 3 and 10, Family Law Rules, O. Reg.114/99, Rule 4(7), Fiorito v. Wiggins, 2014 ONCA 603

Kaynes v. BP, P.L.C., 2018 ONCA 337

Keywords: Securities, Misrepresentation, Securities Act, R.S.O. 1990, c. S.5, Part XXIII.1, ss. 138.3(6) and 138.14, Civil Procedure, Class Actions, Limitation Periods, Pleadings, Determination of Question of Law, Rules of Civil Procedure, Rule 21.01(1)(a)

For Short Civil Decisions click here.

For Criminal Decisions click here.

Del Vecchio v. Del Vecchio, 2018 ONCA 334

[MacFarland, Huscroft and Nordheimer JJ.A.]

Counsel:

M S Balz, for the appellant

K Ballantyne, for the respondent

Keywords: Family Law, Divorce, Support Orders, Orders of the Court, Refusal to Obey, Arrears of Support, Introducing Affidavit Evidence after Expiry of Timelines

Facts:

This contentious and lengthy family law litigation is the result of the appellant’s (Mark Del Vecchio) refusal to obey orders of the court.

The appellant appeals the order of Paisley J. dated October 13, 2017, striking his pleadings and permitting the respondent to proceed to an uncontested trial. At issue was whether the judge failed to consider the affidavit of Karen Pritchard (the appellant’s assistant), filed by the appellant in response to the motion made in writing.

Issues:

(1) Was Paisley J.’s order made in error for failing to consider the evidence contained in the affidavit of Karen Pritchard?

Holding: Appeal dismissed.

Reasoning:

(1) No. The continuing record, which was before Paisley J. for this motion in writing, records the fact that the affidavit was filed with the court and was therefore very likely before the judge when he made his order. While the preamble in the order does not refer to the affidavit, the draft order was prepared by the moving party’s lawyer before she was aware that any responding materials would be filed. By the terms of the July 27, 2017 Horkins J. order, the appellant had no right to notice of this procedural motion,  and was served merely as a courtesy. The moving party would have no reason to expect the appellant would be filing materials – particularly in view of his history of non-compliance.

The content of the Pritchard affidavit was highly contentious – much of the content on its face could not be considered support related. There was no opportunity given to cross-examine on its contents and perhaps most importantly, it was nothing more than an attempted collateral attack on previous support orders. It was also noted that the appellant unilaterally reduced his monthly support payments to $1400 per month, in breach of a previous order.  In these circumstances, Paisley J. did not err by proceeding as he did. The appellant was given numerous chances to comply with and meet his obligations. He simply refused to do so. Not until the very last minute did he take any steps to attempt to show he was not in arrears in respect of the support orders. He still had not complied with the obligations requiring financial production, and unilaterally reduced his support payments. He remained in serious violation of a number of court orders.

Andreevskaia v. Satanovski, 2018 ONCA 330

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

Counsel:

Robert C. Dunford & Sarah Wouters, for the appellants

R. Adam J. Pyne-Hilton, for the respondent

Keywords: Contracts, Real Property, Mortgages, Defences, Non Est Factum, Duress, Unconscionability, Gifts, Summary Judgment

Facts:

The defendants appeal from summary judgment granted by the motion judge to the plaintiff of the sum of $247,247.93 together with interest and costs under a mortgage. The judgment also required the appellants to deliver possession of the property against which the mortgage was secured. The evidence established that the respondent advanced monies to the appellants to assist them in running a charitable organization. Four different advances were made. The first two were repaid but the latter two were not. Eventually, the appellants gave a mortgage to the respondent to secure the amount that was outstanding. They also signed a promissory note for the outstanding amount.

The motion judge concluded that there was no genuine issue requiring a trial. Specifically, she rejected the appellants’ contention that the monies advanced were a gift and not a loan and that they were interest-free. The motion judge also rejected arguments advanced by the appellants that they did not understand the mortgage that they signed (even though they received independent legal advice before signing it), that they signed under duress, and that the mortgage was an unconscionable transaction.

Issues:

(1) Did the motion judge err in granting summary judgment?

Holding:

Appeal dismissed.

Reasoning:

(1) No. The appellants have failed to establish that the motion judge made any palpable and overriding error in the conclusions that she reached. Generally, the various defences advanced by the appellants were untenable and contrary to the evidentiary record. At the hearing of the appeal, the appellants limited their argument to the amount of the judgment, arguing that the motion judge ought not to have determined the amount on the basis of conflicting evidence about payments that they made and in particular ought not to have accepted the accounting in Schedule A that was attached to the respondent’s factum on the motion. Schedule A referred to evidence that was properly before the motion judge as an answer to a question taken under advisement that specifically requested the respondent to summarize the payments made and the amount due. There was no error in the motion judge using this evidence for that purpose. Nor was it necessary for the motion judge to require oral evidence on the amount due. All of the evidence necessary for the purpose of making that determination was before her. In her reasons, the motion judge invited submissions on “the total amount”. If counsel thought there was an issue in this respect, they had the opportunity to advise the motion judge, but no such submissions were made.

PQ Licensing S.A. v. LPQ Central Canada Inc., 2018 ONCA 331

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

Counsel:

Geoffrey B. Shaw and Eric Mayzel, for the appellants

David M. Golden and Marco P. Falco, for the respondent

Keywords: Contracts, Franchise Agreements, Rescission, Arbitration Clauses, Interpretation, Standard of Review, Reasonableness, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co., 2016 SCC 37, Teal Cedar Products Ltd. v. British Columbia, 2017 SCC 32, Dunsmuir v. New Brunswick, 2008 SCC 9, Enforceability, Illegality, Arthur Wishart Act (Franchise Disclosure), 2000, S.O. 2000, c. 3, s. 10, Severance, “Blue Pencil” Approach, Shafron v. KRG Insurance Brokers (Western) Inc., 2009 SCC 6, 2176693 Ontario Ltd. v. Cora Franchise Group Inc., 2015 ONCA 152, Limitations Periods, Discoverability, “Appropriate Means”, Tolling Agreements, Limitations Act, 2002, S.O. 2002, c. 24, Schedule “B”, s. 5(1)(a)(iv) and 22, 407 ETR Concession Co. v. Day, 2016 ONCA 709

Facts:

The appellants (the “franchisor”), PQ Licensing S.A., and the respondents, LPQ Central Canada Inc. (the “franchisee”), were engaged in a dispute about a franchisee’s purported rescission of their franchise agreement. The agreement provided for the mediation, then arbitration, of disputes. On the franchisor’s preliminary motion, the arbitrator determined that the limitation period of two years under the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B had not expired, and that the arbitration of the parties’ dispute could therefore proceed. The franchisor’s appeal to the Superior Court was dismissed. The further appeal to the Court of Appeal was by way of leave.

Issues:

Did the arbitrator err in determining that the limitation period of two years under the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B had not expired?

Holding: Appeal dismissed.

Reasoning:

No. The court held that the arbitrator’s decision that the arbitration was not time-barred was reasonable, which was the applicable standard of review of his decision. It was based on his reasonable conclusions that (i) the parties’ agreement provided for mediation as a precondition to arbitration; (ii) the requirement to mediate “in Delaware”, which ran afoul of section 10 of the Arthur Wishart (Franchise Disclosure) Act, could be severed from the parties’ agreement using the “blue pencil” approach, which kept intact the requirement to mediate, just not in Delaware; and (iii) applying the “appropriate means” branch of the discoverability test in s. 5(1)(a)(iv) of the Limitations Act, 2002, the two year limitation period for arbitration commenced on the date that mediation was deemed completed.

Ernst v. Northbridge Personal Insurance Corporation, 2018 ONCA 339

[Hourigan, Pardu and Huscroft JJ.A.]

Counsel:

A A Evangelista and J Kent, for the appellant

G A Marsden, for the respondents

Keywords: Insurance Law, Coverage, Duty to Defend, Pleadings Rule, Monenco Ltd. v. Commonwealth Insurance Co 2001 SCC 49, Off-Road Vehicles Act, R.S.O. 1990, c. O.4

Facts:

The appellant insurer appeals from the order of the application judge requiring it to defend the appellants in an action arising from an accident involving an ATV. The plaintiff in the action was a passenger on an ATV driven by the respondent Andrew Ernst. The Ernst’s automobile insurance policy extends coverage to an ATV if it is owned by the respondents and the respondents were not occupiers of the property on which the accident occurred. The ATV was to be purchased by Ernst along with the land, but the closing date for the sale was subsequent to the accident.  The appellant insurer denied coverage on the basis that, at the time of the loss, the ATV was not required to be insured because it was being operated on private property, and so did not fall under the definition of “automobile” in the OAP 1, and was considered an off-road vehicle pursuant to the Off-Road Vehicles Act, R.S.O. 1990, c. O.4.

The application judge found against the insurer. The appellant argued that although the application judge properly articulated the pleadings rule, he erred in applying it. In particular, he explored possible outcomes rather than simply evaluating the pleadings, and wrongly assumed that the respondents could not be occupiers of the property because the vendors were also occupiers of the property.

Issues:

Did the application judge err in his application of the pleadings rule?

Holding:

Appeal dismissed.

Reasoning:

The pleadings rule was articulated in Monenco Ltd. v. Commonwealth Insurance Co 2001 SCC 49. It provides as follows: If the pleadings allege facts which, if true, would require the insurer to indemnify the insured for the claim, then the insurer is obliged to provide a defence. The application judge was required to give the pleadings the widest latitude, and did so. He acknowledged that the statement of claim did not specifically allege that the owner of the ATV and occupier of the property were different people at the time of the accident. It included allegations both that the respondents were owners of the ATV and occupiers of the property, and that the vendors were the owners of the ATV and occupiers of the property at the relevant time. Although it is possible for more than one party to be the occupier of property at a time, the pleadings alleged facts that would permit a finding that the vendors, and not the respondents, were the occupiers at the relevant time, and that was sufficient to trigger the appellant’s duty to defend. There is no requirement that the allegations against the respondents be expressly pleaded in the alternative for the duty to defend to arise.

Apotex Inc. v. Abbott Laboratories Limited, 2018 ONCA 332

[Strathy C.J.O., Juriansz and Huscroft JJ.A]

Counsel:

S G Mason and D A Tait for the appellant Abbott Laboratories Ltd.

C C Van Barr and K Murphy for the appellant Takeda parties

A R Brodkin and M S Wilson, for the respondent , Apotex Inc.

Keywords: Intellectual Property, Patents, Pharmaceuticals, Abbreviated New Drug Submissions, Unjust Enrichment, Damages, Patented Medicines (Notice of Compliance) Regulations, SOR/93-133, s. 6, s. 8

Facts:

This is the second appeal arising out of an action brought by Apotex against Abbott and Takeda, concerning the patented medicine Prevacid® and Apotex’s generic drug Apo-lansoprazole. Apotex’s action alleged losses caused by Abbott and Takeda arising out of steps they took to deny Apo-lansoprazole access to the market. Abbott and Takeda were granted partial summary judgment dismissing Apotex’s unjust enrichment claim, and that decision was upheld on appeal by the court: Apotex Inc. v. Abbott Laboratories, Limited, 2013 ONCA 555.

Apotex’s claim for damages continued. Apotex’s claimed damages for sales of Apo-lansoprazole that were lost during the period in which the drug could not be sold because of proceedings taken by Abbott and Takeda under s. 6 of the Patented Medicines (Notice of Compliance) Regulations, SOR/93-133 (NOC Regulations). Those proceedings resulted in a stay of Apotex’s application for approval to sell the drug, and so precluded its sale.

Abbott and Takeda brought a motion for summary judgment seeking to have Apotex’s damages claim dismissed. That motion was dismissed. The motion judge concluded that, but for the proceedings taken by Abbott and Takeda, Apotex would have received approval from the Minister of Health to sell Apo-lansoprazole on April 17, 2007, and was therefore entitled to damages. The quantum of damages was left for determination at trial. Abbott and Takeda appeal from the motion judge’s order dismissing their motion for summary judgment.

Issues:

(1) Did the motion judge err in dismissing the appellant’s motion for summary judgment?

Holding: Appeal dismissed.

Reasoning:

(1) No. Abbott and Takeda’s core argument on the motion was that Dr. Sharma erred in issuing the Patent Hold letter. They submitted that absent this mistake, no NOC could have, would have, or should have been issued until final approval in June, 2009, following expiry of the two-year statutory stay period under s. 6. Thus, s. 8 damages could not have accrued to Apotex. In a comprehensive 52-page judgment, the motion judge – who case-managed the litigation since 2011 – found that, but for Abbott and Takeda’s s. 6 proceeding, Apotex could and would have received a NOC on April 17, 2007. Dr. Sharma’s correspondence showed that Health Canada had completed its review of Apotex’s Abbreviated New Drug Submission (“ANDS”) and found it to be satisfactory and approvable, and would have issued a NOC for Apo-lansoprazole absent the s. 6 proceedings.

Abbott submits that the motion judge made two palpable and overriding errors. First, the motion judge erred in concluding that the high-fat study played no part in the final review process. Second, the motion judge erred in concluding that because the ANDS was ultimately approved in the same form, the June 2, 2009 approval confirmed the April 17, 2007 approval.

Takeda argues that the motion judge erred in three ways. First, the motion judge erred in finding that Apotex’s April 2007 submission was sufficient and that Apo-lansoprazole could be approved without a high-fat study. Second, the motion judge erred in conflating Apotex’s product and submission. The safety and effectiveness of Apo-lansoprazole in 2007 was irrelevant because Apotex’s submission was not sufficient to allow the Minister to determine whether it was. Third, the motion judge erred by substituting his determination as to the sufficiency of Apotex’s submission for that of the Minister. All of these arguments are variations on a theme: the motion judge erred concerning the significance of the high-fat study to the Minister’s decision.

The motion judge made no error, much less a palpable and overriding error, in concluding that Apotex would have received a NOC for Apo-lansoprazole on April 17, 2007, if the s. 6 proceedings had not been commenced by the appellants. On the contrary, there was ample evidence to support the motion judge’s decision.

Mader v. McCormick, 2018 ONCA 340

[Hourigan, Pardu and Huscroft JJ.A.]

Counsel:

Glenda McLeod, for the appellant

Judy Byrne and Kaitlin Jagersky, for the respondent

Keywords: Family Law, Custody and Access, Appointment of Counsel for the Children, United Nations Convention on the Rights of the Child, Articles 3 and 10, Family Law Rules, O. Reg.114/99, Rule 4(7), Fiorito v. Wiggins, 2014 ONCA 603

Facts:

Larry Mader appeals from the decision of the Superior Court of Justice upholding the Ontario Court of Justice decision dismissing his motion to appoint private counsel for two children, L.M., soon to be 16 years old, and N.M., now 13 years old.

In or about 2013, the appellant initiated a motion to vary access. In this proceeding, the Office of the Children’s Lawyer (“OCL”) was appointed for the children. The OCL Office conducted an investigation and concluded that the children did not want to vary the existing access schedule. The appellant withdrew his motion for an increase in access in October 2014. He maintained a motion to decrease child support, based on an argument that there was a shared custody agreement. That motion was dismissed in January 2015. One year later, the appellant elected to retire. In December 2015, he moved again to increase his time with the children and to decrease child support. In May 2016, the appellant moved for an order appointing the OCL. That motion was dismissed and no appeal was pursued.

In August 2016, the appellant moved again for an order appointing a private lawyer for the children, who proposed to conduct an investigation in the same way as would the OCL. The motion judge noted that the custody issues did not involve mobility issues and that this was not a fresh custody application. She dismissed the motion for appointment of private counsel for the children, and her decision was upheld on appeal to the Superior Court of Justice.

The appellant argues that the motion judge was obliged to appoint counsel for the children and failed to pay heed to the United Nations Convention on the Rights of the Child, Can. T.S. 1992 No. 3, and that the appeal judge erred in upholding the decision in the court below.

Issue:

Did the motion judge err in not appointing counsel for the children and did the appeal judge err in upholding that decision?

Holding: Appeal dismissed.

Reasoning:

No.  The court was not persuaded that the motion judge erred in balancing the children’s best interests or that the appeal judge erred in his consideration of the appeal. The decision whether or not to appoint a lawyer for children is a discretionary decision which should focus on the best interests of the children. Deference is owed to a motion judge’s assessment of the advantages and disadvantages of such an appointment: Fiorito v. Wiggins, 2014 ONCA 603.

Rule 4(7) of the Family Law Rules, O. Reg.114/99 provides that “[i]n a case that involves a child who is not a party, the court may authorize a lawyer to represent the child, and then the child has the rights of a party, unless the court orders otherwise.” The wording of the provision is permissive, not mandatory.

Article 3 of the United Nations Convention on the Rights of the Child, ratified by Canada in 1991, provides in part that “[i[n all actions concerning children, whether undertaken by public or private social welfare institutions, courts of law, administrative authorities or legislative bodies, the best interests of the child shall be a primary consideration.”

Article 12 of the same provides as follows:

  1. States Parties shall assure to the child who is capable of forming his or her own views the right to express those views freely in all matters affecting the child, the views of the child being given due weight in accordance with the age and maturity of the child.
  2. For this purpose, the child shall in particular be provided the opportunity to be heard in any judicial and administrative proceedings affecting the child, either directly, or through a representative or an appropriate body, in a manner consistent with the procedural rules of national law.

Kaynes v. BP, P.L.C., 2018 ONCA 337

[Hourigan, Pardu and Huscroft JJ.A.]

Counsel:

Bonnie Roberts Jones and Andrew Morganti, for the appellant

Laura K. Fric, Kevin O’Brien and Karin Sachar, for the respondent

Keywords: Securities, Misrepresentation, Securities Act, R.S.O. 1990, c. S.5, Part XXIII.1, ss. 138.3(6) and 138.14, Civil Procedure, Class Actions, Limitation Periods, Pleadings, Determination of Question of Law, Rules of Civil Procedure, Rule 21.01(1)(a)

Facts:

The Appellant is a plaintiff in a class proceeding against the respondent suing on fourteen alleged misrepresentations. Eleven of the misrepresentations were made more than three years before the action was commenced. The appellant argued that the claims based on the misrepresentations should not be ruled statute-barred on a r. 21.01.(1)(a) motion because it is within the discretion of the judge hearing the leave application to treat them as a single misrepresentation.

The motion judge rejected this argument and ruled that the claims based on the eleven misrepresentations were statute-barred pursuant to s. 138.14 of the Securities Act (the “Act”). He found that the statutory discretion to treat multiple misrepresentations as a single misrepresentation did not impact the limitation period analysis. The appellant appeals this ruling.

Issues:

(1) Did the motion judge err in finding that the appellant’s claim is statute-barred pursuant to s. 138.14 of the Act?

Holding:

Appeal dismissed.

Reasoning:

(1) No. The limitation period in s. 138.14 of the Act is an event-triggered limitation period which commences on the making of the oral statement or release of impugned document. It runs without regard to the plaintiff’s knowledge of the facts giving rise to the cause of action. The eleven misrepresentations were made more than three years before the issuance of the appellant’s statement of claim.

The appellant’s argument that s.138.3(6) of the Act operates to extend the limitation period in the case of multiple misrepresentations was rejected. There is nothing in the language of this section to suggest an intention to modify the clear event-triggered limitation period provided in s. 138.14. Also, Part XXIII.1 of the Act strikes a delicate balance between various market participants. Part of the balance is struck by the three-year event-driven limitation period to protect subsequent shareholders from claims based on alleged misrepresentations made to previous shareholders.

Section 138.6 was designed to protect issuers from multiple rights of action or multiple liability for essentially the same misrepresentation repeated on a number of occasions and not to extend the limitation period.

Even if s. 138.3(6) was intended to modify the limitation period analysis, there is a basis to believe that the limitation period would begin to run from the date the misrepresentation was first made. The result would then be that the limitation period for all fourteen misrepresentations has expired.

Short Civil Decisions 

Borkowsky v. Hogg, 2018 ONCA 325

[Pepall, Brown and Trotter JJ.A.]

Counsel:

Angela Assuras, for the appellants

Ron Aisenberg, for the respondents

Keywords: Endorsement, Contracts, Commercial Lending, Guarantees, Summary Judgment, Appeal Dismissed

Liberty Silver Corp. v. Liberty Insurance Underwriters Inc., 2018 ONCA 327

[Pepall, Brown and Trotter JJ.A.]

Counsel:

John Nicholl and Kyle Magee, for the appellant

Geoff Adair and Gord McGuire, for the respondent

Keywords: Endorsement, Contracts, Insurance Law

2316796 Ontario Inc. v. Chetti, 2018 ONCA 336

[Strathy C.J.O., Roberts and Paciocco JJ.A.]

Counsel:

Eric Sherkin, for the appellant

Tanya Walker and James Coristine, for the respondent

Keywords: Contracts, Real Property, Agreements of Purchase and Sale, Completion Date, Waiver, Assignments, Consent, Appeal Dismissed

Criminal Decisions 

R v. Boussoulas, 2018 ONCA 326

[Watt J.A. (In Chambers)]

Counsel:

Randall Barrs, for the appellant

Katie Doherty, for the respondent

Keywords: Criminal Law,  Firearms Offences, Sentencing,  Release Pending Leave to Appeal, Supreme Court Act, ss. 40,  Criminal Code, ss. 679(3), Appeal Dismissed

R v. A.C. (Publication Ban), 2018 ONCA 333

[Watt, Hourigan and Miller JJ.A.]

Counsel:

David M. Humphrey and Ian B. Kasper, for the appellant

Lisa Joyal, for the respondent

Keywords: Criminal Law, Sexual Assault, Severance of Charges, Collateral Facts, Jury Charge, Appeal Dismissed

R v. Rootenberg, 2018 ONCA 335

[Watt J.A. (In Chambers)]

Counsel:

Shaun Rootenberg, in person

Tracy Kozlowski, for the respondent

Keywords: Criminal Law, Detention Order, Fraud, Judicial Review, Jurisdiction, R. v. Durrani, 2008 ONCA 856, Application Dismissed

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 (MARCH 26 TO MARCH 29)

Good evening.

In Schnarr v. Blue Mountain Resorts Limited, the Court determined that occupiers of recreational properties, such as ski resorts, are entitled to include limitation of liability clauses in their contractual terms with visitors. Such clauses are expressly permitted by the Occupier’s Liability Act. The Court further determined that these clauses are not prohibited by the Consumer Protection Act, even if such agreements are consumer agreements. The case was decided on the basis of principles of statutory interpretation applicable where two legislative provisions conflict with one another.

Other topics covered this week included a priority dispute between insurers in a SABs case, the tort of misfeasance in public office in the context of a challenge to a governmental policy decision (the partial privatization of Hydro One), solicitor negligence, discharges from bankruptcy, slip and fall, the duty of disclosure of litigation agreements in the nature of Mary Carter or Pierringer agreements, breach of fiduciary duty of a departing employee, offers to settle and administrative dismissals of appeals for delay.

Wishing everyone a happy Easter long weekend.

John Polyzogopoulos

Blaney McMurtry LLP

jpolyzogopoulos@blaney.com

Tel: 416 593 2953

Table of Contents 

Schnarr v. Blue Mountain Resorts Limited, 2018 ONCA 313

Keywords: Contracts, Limitation of Liability (Exclusion) Clauses, Enforceability, Torts, Negligence, Occupier’s Liability, Consumer Protection, Consumer Agreements, Statutory Interpretation, Conflicting Statutes, Ejusdem Generis, Expressio Unius Est Exclusio Alterius, Exhaustiveness Doctrine, Generalia Specialibus Non Derogant, Absurdity Doctrine, Occupiers’ Liability Act, ss. 3 & 9, Consumer Protections Act, ss. 1, 7, 9 & 93

Cosolo v. Geo. A. Kelson Company Limited, 2018 ONCA 318

Keywords: Contracts, Employment, Breach of Fiduciary Duty, Breach of Confidence, Summary Judgment

Tondat v. Hudson’s Bay Company, 2018 ONCA 302

Keywords: Torts, Negligence, Occupier’s Liability, Occupiers’ Liability Act, R.S.O. 1990, c. O.2, section 3(1)

Kuczera (Re), 2018 ONCA 322

Keywords: Bankruptcy and Insolvency, Conditional Discharges, Absolute Discharges, Consumer Proposals, Fresh Evidence, Expert Evidence, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, Re Moore, 2013 ONCA 769, 118 O.R. (3d) 161, R v. Mohan, [1994] 2 S.C.R. 9, Westerhof v. Gee Estate, 124 O.R. (3d) 721, 2015 ONCA 206, R. v. Palmer, [1980] 1 S.C.R. 759

Bone Safety Signs, LLC v. Work Zone Safety Products Inc., 2018 ONCA 301

Keywords: Contracts, Debtor-Creditor, Civil Procedure, Summary Judgment, Costs, Offers to Settle, Rules of Civil Procedure, Rule 49, Foreign Currency Obligations, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 121

Hibbert v. McGoogan, 2018 ONCA 310

Keywords: Torts, Negligence, Solicitors, Summary Judgment, Standard of Proof, No Genuine Issue Requiring Trial

Brown v. Peel Mutual Insurance Company, 2018 ONCA 316

Keywords: Civil Procedure, Appeals, Administrative Dismissal for Delay, Extension of Time, Sickinger v. Sickinger, 2017 ONCA 760, Sault Dock Co. v. Sault Ste. Marie (City), [1973] 2 O.R. 479 (C.A.).

Canadian Union of Public Employees v. Ontario, 2018 ONCA 309

Keywords: Torts, Misfeasance in Public Office, Civil Procedure, Striking Pleadings, No Reasonable Cause of Action, Justiciability, Exercise of Executive Authority, Matters of Core Policy, Immunity from Suit, Rules of Civil Procedure, R. 21

 

The Dominion of Canada General Insurance Company v. Unifund Assurance Company, 2018 ONCA 303

 Keywords: Insurance Law, Statutory Accident Benefits, Insurers, Priority Dispute, Arbitrations, Questions of Law, Standard of Review, Reasonableness, Intact Insurance Company v. Allstate Insurance Company of Canada, 2016 ONCA 609, 131 O.R. (3d) 625, Belairdirect Insurance v. Dominion of Canada General Insurance Co. (Travelers), 2018 ONCA 101,  Insurance Act, R.S.O. 1990, c. I.8, Arbitration Act, 1991, S.O. 1991, c. 17., Disputes Between Insurers, O. Reg. 283/95

Handley Estate v. DTE Industries Limited, 2018 ONCA 324

Keywords: Civil Procedure, Settlements, Duty to Disclose, Mary Carter Agreements, Pierringer Agreements, Remedies, Stay of Proceedings, Aecon Buildings v. Stephenson Engineering Limited, 2010 ONCA 898

North Bay (City) v. Vaughan, 2018 ONCA 319

Keywords: Provincial Offenses, Provincial Offences Act, R.S.O. 1990, c. P.33, s.131, Leave to Appeal

For Short Civil Decisions click here.

For Criminal Decisions click here.

For Ontario Review Board Decisions click here.

Schnarr v. Blue Mountain Resorts Limited, 2018 ONCA 313

[Doherty, Brown and Nordheimer JJ.A.]

Counsel:

John A. Olah and Robert A. Betts, for the appellant, Blue Mountain Resorts Limited

Edward Chadderton, Patricia E. Graham, and Jeffrey Belesky, for the respondents/appellants by cross-appeal, Snow Valley Resorts (1987) Ltd. aka Ski Snow Valley (Barrie), Snow Valley Barrie, Snow Valley Ski Resort, Snow Valley, and 717350 Ontario Ltd. (collectively, “Snow Valley”)

Paul J. Pape, Shantona Chaudhury, and Peter Cho, for the respondent, David Schnarr

Paul J. Pape, Shantona Chaudhury, Marc Lemieux, and Ryan Hurst, for the appellant/respondent by cross-appeal, Elizabeth Woodhouse

Peter Pliszka and Zohar Levy, for the interveners, Conservation Halton, Credit Valley Conservation, and Toronto Region Conservation

Robert Love, Edona Vila, and Samantha Bonanno, for the interveners, The Ontario Federation of Snowmobile Clubs and Ontario Cycling Association

Jim Tomlinson and Garett Harper, for the intervener, Canadian Defence Lawyers

Thomas Curry and Ahmad Mozaffari, for the intervener, Tourism Industry Association of Ontario

Judie Im and Baaba Forson, for the intervener, Minister of Government and Consumer Services

Derek Nicholson, for the intervener, Ontario Trial Lawyers Association

Keywords: Contracts, Limitation of Liability (Exclusion) Clauses, Enforceability, Torts, Negligence, Occupier’s Liability, Consumer Protection, Consumer Agreements, Statutory Interpretation, Conflicting Statutes, Ejusdem Generis, Expressio Unius Est Exclusio Alterius, Exhaustiveness Doctrine, Generalia Specialibus Non Derogant, Absurdity Doctrine, Occupiers’ Liability Act, ss. 3 & 9, Consumer Protections Act, ss. 1, 7, 9 & 93

Facts:

These two appeals were heard together as they raise common issues. In both cases, the plaintiffs were patrons of the defendant ski resorts who purchased ski tickets. In both cases, those patrons executed the ski resorts’ waivers of liability as a condition of their tickets. And in both cases, the patrons were injured on the ski resorts’ premises. The patrons sued.

On a r. 21 motion under the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 in the case of Mr. Schnarr, the parties agreed that there was a “consumer agreement” (as defined under s. 1 of the Consumer Protection Act, 2002, S.O. 2002, c. 30, Sched. A (“CPA”)) between Mr. Schnarr and Blue Mountain Resorts Limited (“Blue Mountain”). On that basis, Tzimas J. held that Blue Mountain’s waiver under s. 3(3) of the Occupiers’ Liability Act, R.S.O. 1990, c. O.2 (“OLA”) partially offended ss. 7(1) and 9(3) of the CPA. She held that Blue Mountain’s waiver, insofar as it purported to waive liability in contract, was void and severed from the consumer agreement.

In a similar vein, in the case of Ms. Woodhouse on a r. 22 motion, McCarthy J. held that Snow Valley’s waiver was void in respect of both tort and contract claims. However, he held that a court nevertheless had the equitable power to enforce a void waiver in a consumer agreement pursuant to s. 93(2) of the CPA. It is important to note that, aside from the agreed statement of facts submitted by the parties, none of the underlying facts have yet been proven in court.

Blue Mountain and Ms. Woodhouse appeal. Snow Valley cross-appeals. Foremost, these appeals raise the question of whether the CPA or the OLA governs the relationship between the parties. Specifically, the appeals present a case of first impression as to whether ss. 7 and 9 of the CPA vitiate or void an otherwise valid waiver of liability under s. 3 of the OLA, where the party seeking to rely on the waiver is both a “supplier” under the CPA and an “occupier” under the OLA.

Issues:

(1) Does s. 9 of the CPA conflict with s. 3 of the OLA? If so, how should each statute be interpreted and what effect should be given to the impugned provisions?

(3) Does s. 93(2) of the CPA allow a court to hold a consumer bound to a voided waiver under s. 9(3) of the CPA?

Holding: Appeals and cross-appeal allowed.

Reasoning:

(1) Yes. In this case there is a clear and direct conflict between the OLA and the CPA – and it is an unavoidable one. The OLA permits an occupier to obtain a waiver of liability. The CPA precludes a supplier from obtaining a waiver of liability. In other words, what the OLA permits, the CPA prohibits.

The principles of statutory interpretation urge an approach that allows both statutes to maintain their maximum application and effectiveness. The principles affecting the analysis with respect to which statute should take precedence include:

(i) where a class of things is modified by general wording that expands the class, the general wording is usually restricted to things of the same type as the listed items (ejusdem generis);

(ii) when one or more things of a class are expressly mentioned, others of the same class are excluded (expressio unius est exclusio alterius);

(iii) the exhaustiveness doctrine;

(iv) the provisions of a general statute must yield to those of a special one (generalia specialibus non derogant); and

(v) the absurdity doctrine.

Dealing with each principle in turn, the court ultimately concluded that ss. 7 and 9 of the CPA do not operate to void otherwise valid waivers executed under s. 3(3) of the OLA.

With respect to principle (i) above, the court held that the CPA does not purport to apply a special liability or higher standard of care for actions that are incidental to the role of an occupier. Rather, the CPA seeks to regulate the entirely separate category of consumer transactions between a supplier and consumer. Accordingly, reading the section pursuant to the principle of ejusdem generis, it is clear that the application of any special liabilities or higher standards imposed by the CPA were not meant to be preserved under s. 9(1) of the OLA.

With respect to principle (ii) above, the court held that there is no evidence in the record that in drafting the CPA and the OLA, the Legislature turned its mind to the interplay of these two statutes. There is no basis for expecting an express reference to the OLA in the CPA’s exemptions. Accordingly, there is little value to the expressio unius argument in these appeals and it provides no basis to infer that the Legislature intended for the CPA to supersede the OLA.

With respect to principle (iii) above, the court held that the OLA was intended to be an exhaustive scheme at least in relation to the liability of occupiers to entrants on their premises flowing from the maintenance or care of the premises. The very purpose of this legislative scheme would be undermined if the CPA were allowed to reintroduce another novel contractual duty that purports to subject occupiers to an obligation to warrant that their premises are of a “reasonably acceptable quality”. Accordingly, the fact that s. 9 of the CPA undermines the very purpose of the OLA is a factor that militates towards holding that the OLA supersedes the CPA.

With respect to principle (iv) above, the court held that the OLA carves out consumer transactions that relate to activities covered by the OLA from the application of the CPA. Put another way, to the extent that an occupier engages with members of the public for the use of the occupier’s premises in return for payment, and thus creates a consumer agreement, the provisions of the CPA do not apply to that agreement. At the same time, insofar as parties who are occupiers engage with members of the public and create consumer transactions that do not relate to “persons entering on premises or the property brought on the premises by those persons” (OLA, s. 2), then the CPA would still apply to those consumer transactions.

With respect to principle (v) above, the court held that the conclusion that the CPA does not operate within the sphere of activities governed by the OLA does not undercut the effectiveness of the CPA, nor does it offend public policy. Rather, it allows for the commercial flexibility necessary to promote the goal of encouraging landowners to permit their premises to be used for recreational activities.

(2) No. The purpose behind s. 93(2) of the CPA is to avoid situations where a consumer, who has received the benefit of a consumer agreement, attempts to retain those benefits without performing his or her side of the agreement because of a technical breach of the CPA. Section 93(2) is not intended to permit the court to hold a consumer to a consumer agreement, and therefore s. 93(2) cannot be used to give effect to a waiver that is voided by s. 9(3) of the CPA.

Cosolo v. Geo. A. Kelson Company Limited, 2018 ONCA 318

[Feldman, Pardu and Benotto JJ.A.]

Counsel:

Geoff Hall and Patrick Pengelly, for the appellant

Patrick Monaghan and Michelle Fan, for the respondent

Keywords: Contracts, Employment, Breach of Fiduciary Duty, Breach of Confidence, Summary Judgment

Facts:

The Respondent, Cosolo, is an engineer who was employed by the appellant engineering firm between 2005 and October 30, 2015, becoming a vice-president in July, 2011. During his employment, Cosolo acquired 43,000 Class E common shares of Kelson, which he sold to the company in August 2015 for $891,820. This amount was to be paid in ten installment payments of $89,182 each, plus interest on the outstanding balance.

He received the first installment before resigning in October 2015, but in 2016, after he had become the CEO of a rival engineering firm, Kelson refused to make further payments. It alleged that Cosolo had breached his fiduciary duties by soliciting Kelson employees to join him at the rival engineering firm and by using Kelson’s confidential information to compete against Kelson.

The motion judge granted summary judgment to Cosolo for $750,000. The motion judge found that Cosolo did not cause any harm to Kelson by any breach of fiduciary duty. He found that Cosolo did not use any confidential or proprietary information from Kelson, that the employees who left Kelson to work with Cosolo’s new employer did so on their own initiative, and that the two employees approached by Cosolo did not leave Kelson.

Issues:

  1. Did the motion judge make palpable and overriding errors in finding that Cosolo did not breach his fiduciary duty by communicating with two current Kelson employees and that even if he did, the communications were meaningless breaches?

Holding: Appeal dismissed.

Reasoning:

  1. No. The court held that the motion judge’s conclusion that the respondent did not breach a fiduciary duty was amply supported by the evidence. In other words, there was no genuine issue for trial raised on the record.

Tondat v. Hudson’s Bay Company, 2018 ONCA 302

[Epstein, van Rensburg and Brown JJ.A.]

Counsel:

Alan L. Rachlin, for the appellants

David S. Steinberg and Rebecca C. Glass, for the respondent

Keywords: Torts, Negligence, Occupier’s Liability, Occupiers’ Liability Act, R.S.O. 1990, c. O.2, section 3(1)

Facts:

The respondent slipped and fell when entering a store operated by the appellant Hudson’s Bay Company, which had a contract with the second appellant, Quinterra Property Management Inc. for maintenance services.

At trial, the judge concluded that the floor of the store was wet and that is why the respondent fell. The trial judge also found that the appellants lacked an effective inspection or maintenance system. The only issue on appeal was liability.

Issues:

(1) Did the trial judge err in not requiring the respondent to prove that the wet floor “created an unreasonable risk of harm” before making conclusions about the measures adopted by the appellants to make the premises safe?

Holding:

Appeal dismissed.

Reasoning:

(1) No. Section 3(1) of the Occupiers’ Liability Act imposes an affirmative duty requiring occupiers to take reasonable care in the circumstances to make their premises safe. The factors which are relevant to an assessment of what constitutes reasonable care will necessarily be very specific to each fact situation. The plaintiff in an occupiers’ liability case has the onus to prove that some act or failure to act on the part of the occupier caused her injury.

The trial judge’s reasons disclose that he properly conducted the inquiry required by s. 3(1) of the Occupiers’ Liability Act. The trial judge had the discretion to reject the expert’s testimony that the tiles used on the floor were safe and his reasons for rejecting the testimony were cogent. The expert, during his testing, had not replicated the conditions typical of the entrance to a busy department store on a rainy day as was the case when this slip and fall happened. The evidence of maintenance and other measures taken by the appellants to make the premises safe consisted of a time sheet showing that a single maintenance person had been on duty both as a cleaner and porter in the 118,348 square foot store on the day in question, without any indication of what, if anything, had taken place in the area where the accident occurred. The trial judge reasonably rejected the appellants’ defence that they had discharged their duties as occupiers.

Kuczera (Re), 2018 ONCA 322

[MacFarland, Huscroft and Nordheimer JJ.A.]

Counsel:

Robert Klotz, for the appellant, Miroslaw Kuczera

Patrick Bloomfield in person as Trustee to the Estate of Miroslaw Kuczera, Bankrupt

Keywords: Bankruptcy and Insolvency, Conditional Discharges, Absolute Discharges, Consumer Proposals, Fresh Evidence, Expert Evidence, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, Re Moore, 2013 ONCA 769, 118 O.R. (3d) 161, R v. Mohan, [1994] 2 S.C.R. 9, Westerhof v. Gee Estate, 124 O.R. (3d) 721, 2015 ONCA 206, R. v. Palmer, [1980] 1 S.C.R. 759

Facts:

The appellant was, until about 2007, successfully employed as an electrician until his assets became tied up in matrimonial litigation.

When his income became insufficient to meet the demands of paying support, as well as his legal fees, the appellant began to rely on credit and personal loans to cover his legal expenses. The appellant declared bankruptcy on May 20, 2009, and was discharged on October 14, 2010. However, the matrimonial litigation continued and on April 4, 2011, the appellant’s discharge was annulled.

In June 2011, the appellant made a consumer proposal (the “Proposal”) in an attempt to escape from bankruptcy. By this time, the appellant’s mental and emotional health began to deteriorate significantly as a result of the legal battles he was facing, both in the matrimonial and bankruptcy litigation.  According to a later report from his psychiatrist, the appellant became clinically depressed and suffered from a “Dissociative Identity Disorder”.

The dispute over the proceeds of the matrimonial home was finally judicially resolved in late 2011. In early January 2012, the appellant received $72,850 from the proceeds of the matrimonial settlement, after all deductions and costs and his own legal fees. The appellant made his monthly Proposal payments to the Trustee until his money ran out in late 2012.

Consequently, his Proposal was annulled on December 1, 2012, and the appellant was again in bankruptcy.  The appellant made payments totalling $4,265 under the Proposal. He did not know where all the money went. Amongst other reasons, the appellant says that he had periods of “disassociation” where he was unaware of where he was or what he was doing.

At the discharge hearing, the appellant, representing himself, sought to introduce a brief report from his treating psychiatrist as to his mental state.  The Registrar received his evidence as to his psychiatric condition, but refused to grant an absolute discharge to the appellant. Rather, she ordered a conditional discharge.  The first condition was that the appellant had to pay $61,000 (the amount remaining due under the Proposal), and the second was that he had to attend a second counselling.  Further, the Registrar suspended the discharge for six months. This order was appealed to a judge of the Superior Court, who upheld the Registrar’s order.

The appellant had brought a motion, unsuccessfully, to put introduce fresh evidence in the form of two detailed psychiatric reports  before the appeal judge, but they were not received. He again sought to introduce those reports as fresh evidence on this appeal.

Issues:

(1) Did the appeal judge err in refusing to consider the fresh evidence of the psychiatric reports?

(2) Should the conditional discharge be set aside?

Holding: Appeal allowed.

Reasoning:

(1) Yes. The court stated that the fact that the psychiatrist was the appellant’s treating psychiatrist is not a proper basis for rejecting the evidence.  It might go to the weight that the court would give to the evidence, but the asserted lack of independence is not of the type that would normally constitute a disqualifying factor under the Mohancriteria.

(2) Yes. The court explained that neither the Registrar nor the appeal judge gave proper consideration to the psychiatric evidence. The Registrar did, however, hear directly from the appellant with respect to these issues.  The mental health issues, from which the appellant was suffering at the time that the settlement funds were received, were significant and they could have affected both his thinking and his actions. Further, the condition imposed by the Registrar that the appellant pay $61,000 as a condition of his discharge, given his personal history, was more than just “difficult” for the appellant.  It was crushing, and the court stated it did not reflect the rehabilitative objective of the BIA,as affirmed in Re Moore, 2013 ONCA 769, 118 O.R. (3d) 161.

Accordingly, the court allowed the appeal, set aside the order of the appeal judge and the order of the Registrar, and granted the appellant an absolute discharge.

Bone Safety Signs, LLC v. Work Zone Safety Products Inc., 2018 ONCA 301

[MacFarland, Huscroft and Nordheimer JJ.A.]

Counsel:

Barry Yellin, for the appellant

Matthew Maurer, for the respondent

Keywords: Contracts, Debtor-Creditor, Civil Procedure, Summary Judgment, Costs, Offers to Settle, Rules of Civil Procedure, Rule 49, Foreign Currency Obligations, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 121

Facts:

The defendant appeals from the summary judgment granted by the motion judge that awarded the plaintiff the amount of Canadian dollars sufficient to purchase the sum of US$47,301.92, together with interest and costs.

The appellant was a distributor of the respondent’s product. In late 2015, the respondent notified the appellant that it would be increasing its prices effective May 1, 2016. In response, the appellant ordered a significant amount of product just before the price increase went into effect. The respondent brought this action for payment and moved for summary judgment. The appellant defended the motion on the basis that the respondent had allegedly agreed to take back other unrelated product that had been ordered and paid for years before.

The appellant also appeals against that portion of the costs award that granted costs to the respondent on a substantial indemnity basis from the date of its offer to settle. The appellant asserts that the offer to settle did not comply with Rule 49 of the Rules of Civil Procedure.

Issues:

(1) Did the motion judge err in awarding the plaintiff US$47,301.92?

(2) Did the motion judge err in awarding the respondent costs on a substantial indemnity basis?

Holding: Appeal dismissed.

Reasoning:

(1) No. The motion judge correctly concluded that there was no factual foundation advanced by the appellant to support its defence.

(2) No. The appellant contends that the offer to settle did not comply with Rule 49 because the offer provided for payment of US$42,000, as opposed to providing for the payment of the amount of Canadian dollars required to purchase the foreign currency obligation. Rule 49.02(1) allows a party to make an offer to settle on whatever terms it wishes. The requirement under s. 121 of the Courts of Justice Act, R.S.O. 1990, c. C.43 regarding foreign money obligations applies only to orders of the court for payment of those amounts. Further, even if the appellant’s contention was technically correct, r. 49.13 permits a court to consider any offer to settle made in writing in exercising its discretion with respect to costs. Consequently, there was no merit to the appellant’s complaint regarding the costs determination.

Hibbert v. McGoogan, 2018 ONCA 310

[Doherty, Rouleau and Miller JJ.A.]

Counsel:

Barry Yellin, for the appellant

Matthew Maurer, for the respondent

Keywords: Torts, Negligence, Solicitors, Summary Judgment, Standard of Proof, No Genuine Issue Requiring Trial

Facts:

The appellant appeals the dismissal of his claim for negligence against the respondent solicitor. The appellant had commenced several actions in Superior Court and Small Claims Court, and later retained the respondent to assume carriage of three of the actions. The appellant alleges that the respondent’s errors caused two of the actions to be dismissed, and prevented the execution of the judgment ultimately obtained in one of those actions. He also alleges that a third action was not prosecuted diligently, resulting in a judgment that could not be executed as the defendant had filed for bankruptcy.

On the summary judgment motion, the judge found that the appellant had failed to adduce sufficient evidence in support of the claims of negligence, and in any event failed to establish any resulting loss.

Issues:

(1) Did the motion judge err in dismissing the court reporter and proceeding with the motion for summary judgment with no court reporter present?

(2) Did the motion judge err in not referring the matter to trial?

(3) Did the motion judge err by applying the wrong standard of proof?

Holding: Appeal dismissed.

Reasoning:

(1) No. The summary judgment motion was argued based on a paper record without any oral evidence being adduced. A court reporter was not required.

(2) No. As found by the motion judge, the record was sufficient to decide the matter. The basis of his decision was that the appellant simply failed to advance adequate evidence supporting his allegations of negligence or loss caused by that alleged negligence. This contrasted with the respondent’s comprehensive materials showing that the dismissals and delays were not caused by the errors he is alleged to have committed. In fact, with respect to the third action, the motion judge found that the delay was caused by the appellant’s failure to provide timely instructions and the required retainer.

(3) No. It is well-established that on a motion for summary judgment, the responding party is required to put his best foot forward and show that there is a genuine issue requiring a trial. Even assuming that there was some basis for finding that the respondent was negligent in handling one or more of the appellant’s files, the appellant failed to meet that onus, and in particular failed to produce any evidence that a loss was incurred.

Brown v. Peel Mutual Insurance Company, 2018 ONCA 316

[Brown J.A. (Motion Judge)]

Counsel:

Sylviette Brown, acting in person

Cynthia Verconich and Jessica Forester, for the responding party

Keywords: Civil Procedure, Appeals, Administrative Dismissal for Delay, Extension of Time, Sickinger v. Sickinger, 2017 ONCA 760, Sault Dock Co. v. Sault Ste. Marie (City), [1973] 2 O.R. 479 (C.A.).

Facts: The moving party, Sylviette Brown, moves to set aside the order of the Registrar dated January 24, 2018 dismissing for delay her motion for leave to appeal from the order of Healey J., sitting as a single judge of the Divisional Court dated April 11, 2014. Healey J. dismissed Ms. Brown’s appeal from an order of the Small Claims Court granting judgment in favour of Peel Mutual on its Defendant’s Claim against her in the amount of $14,833.77. In her decision, Healey J. also refused to allow Ms. Brown to seek judicial review of or to renew her effort to appeal the dismissal of her Small Claims Court action against Peel Mutual Insurance Company.

Issues:

(1) Should the Registrar’s administrative dismissal of the appellant’s leave to appeal motion be set aside?

Holding: Motion dismissed.

Reasons:

(1) No. The principles governing a motion to set aside an administrative dismissal of a motion for leave to appeal are those set out in Sickinger v. Sickinger, 2017 ONCA 760 (In Chambers). The appellant has not provided an adequate explanation for not completing her motion for leave to appeal materials. Three judges of the court have seen the file at least five times. Several extensions of the time to complete the materials for her motion for leave to appeal were granted. Blair J.A. tried three times in Status Court to prompt Ms. Brown to complete her materials, to no avail.

Brown J.A. had no confidence that she would file her materials on time if granted an extension, given her delay of almost four years in moving the matter along. That delay constitutes real prejudice to Peel Mutual. The merits of Ms. Brown’s proposed leave to appeal motion appear very weak as they do not satisfy the criteria set out in Sault Dock Co. v. Sault Ste. Marie (City), [1973] 2 O.R. 479 (C.A.).

Canadian Union of Public Employees v. Ontario, 2018 ONCA 309

[MacFarland, Huscroft and Nordheimer JJ.A.]

Counsel:

L Century and S Shrybman, for the appellant

B Kettles, C P Thompson and S Mathai, for the respondents

Keywords: Torts, Misfeasance in Public Office, Civil Procedure, Striking Pleadings, No Reasonable Cause of Action, Justiciability, Exercise of Executive Authority, Matters of Core Policy, Immunity from Suit, Rules of Civil Procedure, R. 21

Facts:

The appellants, electricity ratepayers required to pay debt retirement charges to the Ontario Electricity Financial Corporation, brought an action seeking damages and declaratory relief concerning the sale of shares in Hydro One, pursuant to a plan to privatize the electricity utility. The respondents are the Premier of Ontario, the Minister of Energy, and the Minister of Finance, all of whom exercised Ministerial power and statutory authority in connection with the sale.

The appellants’ claim was based on the tort of misfeasance in public office. They alleged that the Premier and Ministers acted in bad faith in connection with the privatization plan, and in particular acted to reward past donors and to obtain further donations to the Ontario Liberal Party.

The motion judge struck out the appellants’ claim under Rule 21 and dismissed the action. The motion judge concluded that the action was not justiciable because it concerned a matter of core policy, and therefore was immune from suit unless the decision was irrational or made in bad faith. The appellants did not argue that the decision was irrational. The motion judge found that the material facts pleaded were inadequate to support either a conclusion or an inference that the Ministers had acted in bad faith. Specifically, he concluded that the appellants’ claim “does not contain sufficiently detailed and fact-specific allegations linked to actual events, documents, and people, to pass muster as a valid pleading of bad faith conduct by the Ministers”.

The appellants argue that, properly understood, their claim pleads facts that support a conclusion of bad faith and that it should not have been struck out.

Issues:

(1) Did the motion judge err by assessing the material facts in isolation rather than reading the claim generously and as a whole?

(2) Did the motion judge err by misconstruing material facts as independent challenges to government policy, rather than as particulars of the legal elements of the claim?

(3) Did the motion judge err by failing to accept material facts as true and improperly reaching contrary factual findings?

Holding: Appeal dismissed.

Reasoning:

(1) The motion judge was required to strike the appellant’s claim only if it was “plain and obvious” that it did not disclose a reasonable cause of action. In making this determination, the motion judge was required to read the claim generously, making allowances for drafting inadequacies: Nash v. Ontario, 27 O.R. (3d) 1 (C.A.) at para. 11.

As the Ontario Court of Appeal noted in Trillium Power Wind Corp. v. Ontario (Natural Resources), 2013 ONCA 683, 117 O.R. (3d) 721, at para. 52, the exception permitting challenges to irrational and bad faith government policy decisions under the tort of “misfeasance in public office” is quite narrow:  “A core policy decision made by the Executive based on political considerations or electoral expediency does not, on its own, constitute “bad faith” for purposes of a tort claim based on misfeasance in public office.” Decisions based on political expediency are to be expected. The check on them lies in democratic, not judicial, oversight. Thus, more is required to sustain a pleading than simply an allegation that government officials have acted in bad faith, or have acted for partisan political purposes. There is no question that it is difficult to plead the tort of misfeasance in public office, but that is so because matters of core policy are supposed to be immune from suit, absent rare cases of irrationality or bad faith.

(2) No. The motion judge carefully reviewed all of the facts pleaded and found that they did not plausibly support either the conclusion or the inference that the respondents acted in bad faith. He did not reject the pleadings on the basis that they were simply an objection to the policy being pursued. Rather, he found that they were precisely the sort of objections to which the immunity was intended to apply. The appellants pleaded that the respondents engaged in fundraising activities that included institutions and law firms involved in the Hydro One share sale. These were no more than pleadings that the government had engaged in political activities that benefited the Ontario Liberal Party, which could not possibly support the conclusion or inference that they had acted in bad faith.

(3) No. The motion judge’s reasons, read in context, indicated that there were innocent explanations for conduct the appellants contended was sinister. Read as a whole, the motion judge’s decision makes clear that the appellants’ allegations simply did not support a conclusion or inference that decisions concerning the sale were made in bad faith.

Given that the claim was not justiciable, the claim was properly struck out and the action was properly dismissed.

The Dominion of Canada General Insurance Company v. Unifund Assurance Company, 2018 ONCA 303

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

Counsel:

D McGoey, for the appellant

E K Grossman, for the respondent

 Keywords: Insurance Law, Statutory Accident Benefits, Insurers, Priority Dispute, Arbitrations, Questions of Law, Standard of Review, Reasonableness, Intact Insurance Company v. Allstate Insurance Company of Canada, 2016 ONCA 609, 131 O.R. (3d) 625, Belairdirect Insurance v. Dominion of Canada General Insurance Co. (Travelers), 2018 ONCA 101,  Insurance Act, R.S.O. 1990, c. I.8, Arbitration Act, 1991, S.O. 1991, c. 17., Disputes Between Insurers, O. Reg. 283/95

Facts:

This appeal arose in the context of a dispute between insurers with respect to the payment of statutory accident benefits (“SABS”), and the determination by the arbitrator of a preliminary issue.

Jing Hua Fan, the SABS claimant, owns an automobile repair shop. He was injured in an accident that occurred while he was test driving a customer’s vehicle. The Dominion of Canada General Insurance Company (“Dominion”) insured the repair shop under a garage policy of insurance. Mr. Fan was also a named insured under a motor vehicle liability policy issued by Unifund Assurance Company (“Unifund”), covering his personal vehicle. On January 4, 2012 Dominion received Mr. Fan’s application for SABS and began paying him benefits. On January 24, 2012, Dominion delivered a notice to Unifund, asserting that Unifund was in higher priority to pay Mr. Fan’s claim under s. 268(2) of the Insurance Act, R.S.O. 1990, c. I.8 (the “Act”). Dominion served Unifund with a Notice of Commencement of Arbitration on November 5, 2012, initiating arbitration proceedings to determine the insurer responsible for paying the claimant’s SABS.

After two pre-hearing conference calls with the arbitrator, Dominion notified Mr. Fan of the dispute between the insurers by letter dated June 23, 2014, that enclosed the Dispute Between Insurers (DBI) Notice. The notice informed Mr. Fan of his right to object to the transfer of his claim and, if he objected, of his right to participate in any proceeding that might take place to determine which insurer was responsible to pay SABS. Mr. Fan did not respond to the notice. He attended an examination under oath in July 2014. He continued to receive benefits from Dominion. He did not resolve his SABS claim with Dominion, and the claim remained open during these proceedings. At the commencement of the arbitration hearing, Unifund made a preliminary objection to the jurisdiction of the arbitrator. The objection was based on Dominion’s failure to notify the claimant of the dispute between the insurers within 90 days of its receipt of the application for SABS. Unifund argued that such notice was a statutory precondition to Dominion’s claim that Unifund pay the claimant’s SABS.

The determination of the payor of SABS in priority disputes is resolved in accordance with the rules set out in s. 268(2) of the Act. Section 275(4) of the Act requires insurers to refer any unresolved priority dispute to arbitration under the Arbitration Act, 1991, S.O. 1991, c. 17. Disputes Between Insurers, O. Reg. 283/95, governs the procedures to be followed by insurers in a SABS priority dispute.

The arbitrator determined the issue in favour of the appellant. This decision was reversed on appeal to the Superior Court of Justice. The appeal judge applied a correctness standard of review and substituted his own interpretation of the applicable regulation for that of the arbitrator.

Issues:

(1) Did the appeal judge apply the correct standard of review?

(2) Was the arbitrator’s decision reasonable?

Holding:

Appeal allowed.

Reasoning:

(1) The decisions of SABS arbitrators respecting priority disputes are presumptively subject to review for reasonableness on appeal, even where the principal issue is a question of law: Intact Insurance Company v. Allstate Insurance Company of Canada, 2016 ONCA 609, 131 O.R. (3d) 625. The Court of Appeal went on to review the recent decision of Belairdirect Insurance v. Dominion of Canada General Insurance Co. (Travelers), 2018 ONCA 101 where the Court of Appeal applied the reasonableness standard of review of Intact to a question that could be characterized as one of statutory interpretation by a SABS arbitrator in a priority dispute: whether a person who was listed as an “excluded driver” was an “insured person” under s. 3 of the SABS regulation. The Court therefore concluded that there is a presumption of a standard of reasonableness, save for “exceptional” questions of law. The arbitrator was a specialized decision-maker engaged in interpreting her home statute and regulation in the context of the determination of a preliminary issue in a priority dispute under the SABS regime and therefore her decision should be reviewed on the standard of reasonableness.

(2) The arbitrator concluded that, while Dominion was required to give notice of the priority dispute with Unifund to the claimant, there was no prescribed time limit for notice. The notice that was given, albeit very late, satisfied the requirement. It permitted the participation by Mr. Fan in the proceedings to the extent contemplated by the regulation. The insured’s participation rights are limited to a right to object to the transfer of the claim, to be party to proceedings respecting any transfer, and to approve or object to any settlement of the dispute. The resolution of the dispute depends on s. 268(2) of the Act, and not on any objection or position taken by the claimant. The overriding objective of the regulation is to provide a procedure to determine priority disputes. That objective would not be furthered, and may well be undermined, by importing a requirement that has nothing to do with the determination of the dispute or the rights of the parties. The arbitrator reasonably characterized the claimant’s rights as procedural. It was reasonable for the arbitrator to conclude that a 90 day time limit was not essential to protect the claimant’s rights to object and participate, which could be protected in other ways. The Court of Appeal therefore found that the arbitrator’s interpretation of the requirements of the regulation was reasonable, as was her determination that the appellant’s notice to the claimant only after the arbitration proceedings were underway did not bar the appellant from pursuing its priority dispute with the respondent.

Handley Estate v. DTE Industries Limited, 2018 ONCA 324

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

Counsel:

Donald Dacquisto and Eric Zadro, for the appellant

Sean Dewart and Mathieu Bélanger, for the Lawyers’ Professional Indemnity Company, on behalf of the respondents

Keywords: Civil Procedure, Settlements, Duty to Disclose, Mary Carter Agreements, Pierringer Agreements, Remedies, Stay of Proceedings, Aecon Buildings v. Stephenson Engineering Limited, 2010 ONCA 898

Facts:

The respondent was the plaintiff in the underlying action who subsequently entered into two agreements with the defendant, H&M Combustion Services Ltd. (“H&M”) in 2011 and 2016, to indemnify H&M from any exposure in the litigation in exchange for the assignment of its rights to the plaintiff in pursuing a third party claim that H&M commenced against the appellant.

Neither the respondent nor H&M disclosed the two agreements to the appellant immediately upon execution. Instead disclosure was made in a piecemeal fashion throughout 2016.

The appellants brought a motion to stay the action on the basis that the plaintiff and H&M failed to comply with the obligation of immediate disclosure set out in the decision of the Court of Appeal in Aecon Buildings v. Stephenson Engineering Limited. The motion judge held that while the two agreements should have been disclosed, there would be no stay of the action because the appellants were not prejudiced by the late disclosure.

Issues:

(1) Did the motion judge err in not granting a stay of the action based on the Court of Appeal’s decision in Aecon?

Holding:

Appeal allowed.

Reasoning:

(1) Yes. The obligation of immediate disclosure is not limited to pure Mary Carter or Pierringer agreements. The disclosure obligation extends to any agreement between or amongst parties to a lawsuit that has the effect of changing the adversarial position of the parties set out in their pleadings into a cooperative one. The two agreements made in this case between the respondent and H&M changed the litigation landscape and, accordingly, triggered the duty of immediate disclosure. The absence of prejudice does not excuse the late disclosure of such an agreement and any failure of compliance amounts to an abuse of process and must result in consequences of the most serious nature for the defaulting party. The only remedy to redress the wrong of the abuse of process is to stay the claim asserted by the defaulting, non-disclosing party. The motion judge erred in failing to apply Aecon’s remedy of staying the claim of the party that did not immediately disclose a litigation agreement. Such misdirection is not entitled to deference.

North Bay (City) v. Vaughan, 2018 ONCA 319

[Brown J.A]

Counsel:

A Burgess, for the moving party

S Lemke, for the responding party

Keywords: Provincial Offenses, Provincial Offences Act, R.S.O. 1990, c. P.33, s.131, Leave to Appeal

Facts:

The applicant, Joanne Vaughan, applies under s. 131 of the Provincial Offences Act, R.S.O. 1990, c. P.33 (the “POA”), for leave to appeal the judgment of Justice Lalande of the Ontario Court of Justice made May 9, 2017 that dismissed her appeal from the conviction and sentence imposed by Justice of the Peace Scully on May 1, 2015. In November 2012, the applicant was charged with operating a rental unit without holding a current valid licence contrary to the City of North Bay’s residential rental housing bylaw. The applicant obtained the required licence in February 2013. She and her husband sold the property in April 2013.

She did not attend the trial. At the trial, through her counsel, the applicant entered a plea of not guilty. However, she did not contest the facts read in by counsel for the City. A conviction was entered. Counsel made a joint submission on sentence, which the Justice of Peace accepted. The Justice of the Peace suspended the sentence and ordered the applicant not to operate a rental unit without holding a valid licence for two years. The applicant appealed to the Ontario Court of Justice. She took the position that her counsel did not follow her instructions to vigorously contest the charge. Three witnesses testified before the appeal judge: the applicant and the two lawyers who acted for her immediately before and at the trial, Geoffrey LaPlante and Killian May. The appeal judge dismissed the appeal.

Issues:

(1) Should Leave to appeal be granted?

Holding:

Application for leave to appeal dismissed.

Reasoning:

(1) The applicant sought leave on the ground that at trial she entered what amounted to an uninformed guilty plea, which should be set aside. She argued that it is in the public interest for leave to be granted. The applicant contended that hearing her appeal would enable the court to provide needed guidance on the law governing pleas entered in a defendant’s absence.

In order for leave to be granted pursuant to section 131, the applicant must establish: (i) special grounds; (ii) on a question of law alone; and (iii) that, in the particular circumstances of this case, it is essential in the public interest or for the due administration of justice that leave be granted.

The issue before the appeal judge was straight-forward: Did the applicant instruct trial counsel to enter a plea of not guilty, not dispute the City’s facts, and then proceed with a joint submission on sentence? That called for a factual inquiry.  The appeal judge made clear findings of fact. He did not accept the applicant’s evidence that she was confused by the offer the City made the day before trial or what would be involved in pleading not guilty, but not contesting the facts. The appeal judge held: “It is difficult in looking at all of this in these circumstances to conclude that [the applicant] was somehow caught off-guard when speaking with Mr. May and confused about what his instructions were to be.” The applicant’s claim, therefore, was found to be fact-based and leave was denied

 

Short Civil Decisions 

 Oliveira v. Aviva Canada Inc., 2018 ONCA 321

[MacFarland, Huscroft and Nordheimer JJ.A.]

Counsel:

Deborah Berlach, for the appellants

Stephen J. Moreau and Michael Mandarino, for the respondent

Keywords: Contracts, Insurance Policies, Interpretation, Coverage, Duty to Defend, Torts, Intrusion upon Seclusion

Criminal Decisions 

R v Sadykov, 2018 ONCA 296

[Juriansz, Watt and Miller JJ.A]

Counsel:

Jennifer K. Penman and Karen Heath, for the appellant

Brett Cohen, for the respondent

Keywords: Criminal Law, Aggravated Assault, Assault with a Weapon and Possession of a Weapon, Inmates, Criminal Code, s. 719(1), R. v. Tam

R v Al-Masajidi, 2018 ONCA 305

[Sharpe, Pardu and Fairburn JJ.A. ]

Counsel:

Jamaldin Najma, for the appellant

Kathleen Farrell, for the respondent

Keywords: Criminal Law, Uttering a Death Threat to an Officer, Sentencing, Immigration Consequences, Immigration and Refugee Protection Act, S.C. 2001, c. 27, s. 36(1)(a), R. v. Pham

 R v George, 2018 ONCA 314

[Brown J.A.]

Counsel:

Anita Nathan, for the appellant

Stephen Oakey, for the respondent

Keywords: Criminal, Bail, Special Circumstances, Criminal Code, s. 520, R v Durrani

 R v Jeeva, 2018 ONCA 308

[Feldman, Watt and Paciocco JJ.A.]

Counsel:

Dean Embry, for the appellant

Brett Cohen, for the respondent

Keywords: Criminal Law, Insurance Fraud, Canadian Charter of Rights and Freedoms, s. 11(b), R. v. Jordan

R v LC, 2018 ONCA 311

[Sharpe, Pardu and Fairburn JJ.A.]

Counsel:

Melissa Adams, for the appellant

Geneviève McInnes, for the respondent

Keywords: Publication Ban, Criminal Law, Sexual Assault, Sexual Interference, Sentencing, Threat to Public Safety, Criminal Code, s. 161 Prohibition Order

R v Mallozzi, 2018 ONCA 312

[Sharpe, Pardu and Fairburn JJ.A]

Counsel:

David Littlefield, for the appellant

Gregory Lafontaine, for the respondent

Keywords: Criminal Law, Stay of Proceedings, Unreasonable Delay, R. v. Jordan, R. v. Morin, R. v. Cody, R. v. Gopie

 R v Primmer, 2018 ONCA 306

[Sharpe, Pardu and Fairburn JJ.A. ]

Counsel:

Richard Litkowski and John Fennel, for the appellant

Megan Petrie, for the respondent

Keywords: Criminal Law, Assault Causing Bodily Harm, Self-Defence

R v Martins, 2018 ONCA 315

[Doherty, Rouleau and Miller JJ.A.]

Counsel:

Michael Little, for the appellant

Tanit Gilliam, for the respondent

Keywords: Criminal Law, Search Warrant

R v McBride, 2018 ONCA 323

[Watt, Brown and Roberts JJ.A]

Counsel:

Erin Dann, for the appellant

Mabel Lai, for the respondent

Keywords: Criminal Law, Harassment, Not Criminally Responsible on Account of a Mental Disorder

R v Canary, 2018 ONCA 304

[Feldman, Brown and Fairburn JJ.A.]

Counsel:

Paul Alexander, for the appellant

Ian Bell, for the respondent

Keywords: Criminal Law, Drug Possession, Canadian Charter of Rights and Freedoms, ss. 8 and 9, Freedom for Unreasonable Search and Seizure and Arbitrary Detention

Canada (Attorney General) v. Georgiou, 2018 ONCA 320

[Strathy C.J.O., Simmons and Hourigan JJ.A.]

Counsel:

Maurice J. Neirinck, for the appellant

Jeffrey G. Johnston, for the respondent

Keywords: Criminal Law, Fraud, Kelly Order, Mutual Legal Assistance in Criminal Matters Act, R.S.C. 1985, c. 30, ss. 9.3(4), Criminal Code, s. 462.3(1)

Review Board Decisions 

Sajid (Re), 2018 ONCA 292

[Epstein, van Rensburg and Brown JJ.A.]

Counsel:

Erin Dann and Cate Martell, for the appellant

Gavin S. MacKenzie, for the Centre for Addiction and Mental Health

Christopher Webb, for the Attorney General of Ontario

Keywords:  Health Law, Ontario Review Board, Significant Threat to Public Safety

Marchese (Re), 2018 ONCA 307

[Watt, Brown and Huscroft JJ.A.]

Counsel:

Russell Browne, for the appellant Mary Marchese

Megan Petrie, for the respondent the Attorney General of Ontario

Keywords: Health Law, Ontario Review Board, Threat to Public Safety,  Mental Health Act, R.S.O. 1990, c. M.7,  Winko v British Columbia (Forensic Psychiatric Institute), R v Owen, Delta Air Lines Inc v Lukács, R v Ferguson, Carrick (Re)

Medcof (Re), 2018 ONCA 299

[Strathy C.J.O., Simmons and Hourigan JJ.A.]

Counsel:

Erin Dann, for the appellant

Nancy Dennison, for the Attorney General of Ontario

Gavin S. MacKenzie, for the Centre for Addiction and Mental Health

Keywords: Health Law, Ontario Review Board, Threat to Public Safety, Criminal Code, s. 672.78, Winko v British Columbia (Forensic Psychiatric Institute)Carrick (Re), Dunsmuir v. New Brunswick, Ferguson and Re Pellet

Hammoud (Re), 2018 ONCA 317

[Feldman, Watt and Paciocco JJ.A.]

Counsel:

Michael Davies, for the appellant

Jacquie Dagher, for Royal Ottawa Mental Health Centre

Molly Flanagan, for the Attorney General

Keywords: Health Law, Ontario Review Board, Significant Threat Threshold

Magee (Re), 2018 ONCA 300

[Doherty, Rouleau and Miller JJ.A.]

Counsel:

Dean Embry, for the appellant

Carmen Elmasry, for the Ministry of the Attorney General

Janice Blackburn, for the Person in Charge, Waypoint Centre for Mental HealthCare

Keywords: Health Law, Ontario Review Board, Threat to Public Safety

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 (MARCH 19 – MARCH 23)

Good evening.

It has been a busy week at the Court of Appeal and a notable one at our office. I would first like to congratulate Varoujan Arman and Megan Hodges of our office, who successfully responded to an appeal on behalf of our client in V. Melfi Holdings Ltd. v. Dourada Investment Inc. In that case, Dourada purchased an industrial warehouse from Melfi, who was permitted to remain in a portion of the premises as Dourada’s tenant for a limited period of time in order to remove a substantial amount of scrap metal, equipment, and debris that occupied the premises. Melfi eventually failed to pay rent and stopped attending the premises altogether, however it refused to dispose of the scrap material and debris that it had left behind despite repeated demands by Dourada. After a long period of negotiation, the locks were changed and Dourada sold what it could in order to mitigate its damages and recover arrears of rent.

Dourada was successful on its summary judgment motion in obtaining judgment for arrears of rent and damages for Melfi’s breach of its covenant pursuant to the agreement of purchase and sale to leave the premises empty and in “broom-swept condition”. Melfi appealed from the summary judgment decision, alleging that, among other things, the motion judge had erred in finding that Melfi’s failure to remove its goods constituted abandonment. The Court of Appeal found that the motion judge made no errors and that his factual findings were available to him on the evidence. Accordingly, Melfi’s appeal was dismissed.

In Reeves v. Brand, 2018 ONCA 263, our new family lawyer, Ryan Kniznik, represented a mother in a contested relocation and custody application. This was a decision involving important principles of general application to determinations of child relocation or mobility, an area, which Laskin J.A. noted was “among the most difficult cases in family law”. Ryan notes that Laskin J.A., on behalf of the panel, discussed the concepts of maximum contact, disruption to the child, and the parent’s reasons for moving, within the context of a parent’s request to move a child some distance away from the other parent.  The decision provides a nuanced analysis with respect to maximum contact, in that there has to be a reasonable application of this principle.  Further, the decision, under the disruption factor, noted that children are adaptable to change, and the disruption to a younger child is likely less significant than an older child.  The decision is important to review and consider when grappling with a mobility or relocation case.

In Brown v. Woodstock (Police Services Board), the Court applied its recent decision in Winmill v. Woodstock (Police Services Board), confirming that claims of battery against the police are discoverable after mirror image criminal charges against a plaintiff are dismissed or withdrawn. Until then, suing is not an “appropriate means” of seeking a remedy within the meaning of ss. 5(1)(a)(iv) of the Limitations Act, 2002.

Finally, in 2363523 Ontario Inc. v. Nowack, Justice Brown lamented an apparent increase in motions seeking panel reviews of decisions made by single judges of the Court of Appeal. In the past the Court has lamented the difficulty in sometimes determining appeal routes and whether an order is final or interlocutory. Hopefully, MAG will review the Courts of Justice Act and the Rules as they relate to appeals and introduce some much-needed fine-tuning.

Other topics covered this week included seeking intervener status in an environmental contamination case, automobile insurance, MVA jury trials, motions for summary judgment in the class action context, breach of confidence, family law, bankruptcy and insolvency and solicitors’ liens and charging orders.

I wish everyone a happy and safe start to the Spring.

John Polyzogopoulos

Blaney McMurtry LLP

jpolyzogopoulos@blaney.com

Tel: 416 593 2953

Table of Contents

V. Melfi Holding Ltd. v. Dourada Investment Inc., 2018 ONCA 290

Keywords: Real Property, Commercial Leases, Default in Payment of Rent, Abandonment of Property, Improvident Sale, Damages, Mitigation

Reeves v. Brand, 2018 ONCA 263

Keywords: Family Law, Child Custody, Relocation, Best Interests of the Child, Costs

Bracken v. Niagara Parks Police, 2018 ONCA 261

Keywords: Constitutional Law, Canadian Charter or Rights and Freedoms, Section 2(b), Freedom of Expression, Property Law, Trespass, Provincial Offences, Disturbing Others, Using Abusive or Insulting Language, Provincial Offenses Act, R.S.O. 1990, c. P.33, Niagara Parks Act, R.S.O. 1990, c. N. 3, R. v. Batty, 2011 ONSC 6862

A.C. Concrete Forming Ltd. v. JAC Concrete Structures and  Drain Inc., 2018 ONCA 272

Keywords: Contracts, Oral Agreements, Civil Procedure, Offers to Settle, Enforcement, Summary Judgment, Rules of Civil Procedure, Rules 20 and 49

Ligaj v. Ismail, 2018 ONCA 271

Keywords: Torts, Negligent Entrustment, Insurance Law, Automobile Insurance, Uninsured Motorists, Driving with Consent of Owner

Barker v. Barker, 2018 ONCA 255

Keywords: Torts, Battery, Negligence, Breach of Fiduciary Duty, Civil Procedure, Class Actions, Summary Judgment, Procedural Fairness, Limitation Periods, Laches, Statutory Interpretation, Retroactivity, Limitations Act, 2002, S.O. 2002, c. 24, Sch. B, s. 16(1)(h.2)

Dunk v. Kremer, 2018 ONCA 274

Keywords: Torts, Negligence, MVA, Civil Procedure, Expert Reports, Rules of Civil Procedure, Rule 53, Jury Trials, Closing Address, Damages

Pey v. Pey, 2018 ONCA 284

Keywords: Family Law, Orders, Support, Enforcement, Striking Motions, Committal for Non-Payment, Family Responsibility Office

Weenen v. Biadi, 2018 ONCA 288

Keywords: Contracts, Solicitor and Client, Unpaid Legal Fees, Charging Orders, Solicitors’ Liens, Solicitors Act, R.S.O. 1990, c. S.15, s. 34, Appellate Jurisdiction, Courts of Justice Act, R.S.O. 1990, c. C.43, ss. 13(2) and 134(1)

The Catalyst Capital Group Inc. v. Moyse, 2018 ONCA 283

Keywords: Torts, Breach of Confidence, Spoliation, Costs, Substantial Indemnity

2363523 Ontario Inc. v. Nowack, 2018 ONCA 286

Keywords: Civil Procedure, Extension of Time, Security for Costs, Yaiguaje v. Chevron Corporation, 2017 ONCA 827, Courts of Justice Act, R.S.O. 1990, c. C.43, to ss. 7(5), Rules of Civil Procedure, R. 61.16(6).

Brown v. Woodstock (Police Services Board), 2018 ONCA 275

Keywords: Torts, Battery, Wrongful Arrest, Unlawful Search and Seizure, Wrongful Detention, Civil Procedure, Limitation Periods, Discoverability, “Appropriate Means”, Limitations Act, 2002, s. 5(1), Winmill v. Woodstock (Police Services Board), 2017 ONCA 962

Huang v. Fraser Hillary’s Limited, 2018 ONCA 277

Keywords: Torts, Nuisance, Trespass, Negligence, Strict Liability (Rylands v. Fletcher (1868), L.R. 3 H.L. 330 (U.K. H.L.)), Environmental Contamination, Environmental Protection Act, R.S.O. 1990, s. 99, Civil Procedure, Interveners, Rules of Civil Procedure, Rule 13.02, Peel (Regional Municipality) v. Great Atlantic & Pacific Co. of Canada Ltd. (1990), 74 O.R. (2d) 164 (C.A.)

For Short Civil Decisions click here

For Ontario Review Board Decisions click here

For Criminal Decisions click here

 

V. Melfi Holding Ltd. v. Dourada Investment Inc., 2018 ONCA 290

Sharpe, Juriansz and Miller JJ.A.

D. Saverino, for the appellant

Varoujan Arman and Megan Hodges, for the respondent

Keywords: Real Property, Commercial Leases, Default in Payment of Rent, Abandonment of Property, Improvident Sale, Damages, Mitigation

Facts:

The appellant, V. Melfi Holding Ltd. (“Melfi”), was the owner of a large industrial warehouse which it sold to the respondent, Dourada Investment Inc. (“Dourada”), in 2011. Melfi was permitted to remain on the property as a tenant for a limited three-month period following the closing of the sale in order to remove its contents. Melfi then remained for a further period on a month-to-month basis as an over-holding tenant, and eventually defaulted on the payment of rent and utilities.

As part of the Agreement of Purchase and Sale for the sale of the property, Melfi was required to leave the premises in a “broom-swept” condition. Pursuant to the terms of the sale agreement, Dourada was also entitled to hold back $100,000 from the purchase price, to be released to Melfi upon all of Melfi’s sale covenants being fulfilled.

Following the termination of the lease, Melfi refused to remove its large amount of equipment and debris in the leased premises. On April 14, 2014, Dourada locked Melfi out of the premises for its failure to pay rent and utilities. Eventually, after multiple requests by Dourada for Melfi to remove its contents, for which Dourada provided numerous opportunities, Dourada sold what it could in order to mitigate its damages for arrears of rent and lost prospective rent.  Before doing so, Dourada obtained two appraisals regarding the value of the property.

Dourada brought a summary judgment motion against Melfi seeking arrears of rent, utilities and other damages. The motion was granted, with the motion judge finding that Melfi had in effect abandoned its goods. Melfi was held liable for rent/damages calculated at 25.5 months in the amount of $286,875 plus HST and utilities, less credits and the amounts Dourada recovered through its sale efforts. The motion judge further held that, contrary to Melfi’s allegation, there was no improvident sale, as Dourada had acted in a commercially reasonable manner in obtaining two appraisals and selling the abandoned contents to mitigate its damages after having provided ample advance warning to Melfi that this would be done.

Melfi appealed.

Issues:

1) Did the motion judge make a palpable and overriding error in finding that Melfi’s actions in failing to remove its contents from the premises constituted abandonment, entitling Dourada to sell the items to recoup arrears of rent?

2) Did the motion judge err in his calculation of the rent and damages payable by Melfi?

3) Did the motion judge err in ordering that the $100,000 holdback funds be released to Dourada?

4) Should Dourada have followed the procedure set out in the Commercial Tenancies Act regarding distress for non-payment of rent, even though Melfi conceded that this was not a situation of distress?

Holding:

Appeal dismissed.

Reasoning:

1) No. Dourada repeatedly requested that Melfi remove its goods from the warehouse, and gave Melfi multiple opportunities to do so. Melfi failed to avail itself of those opportunities, insisting that it would only remove the contents on its own terms. There was sufficient evidence on the motion for the motion judge to make the finding that Melfi had abandoned its goods.

2) No. Melfi was locked out of the premises on April 14, 2014, therefore rent was payable up to that date. Melfi’s failure to remove the contents from the premises made it impossible for Dourada to use or rent the premises. Therefore, the motion judge properly calculated damages for breach of the contractual obligation on the basis of rent that would otherwise be payable.

3) No. Melfi breached the terms of the Agreement of Purchase and Sale requiring it to remove its goods. As a result, the motion judge was entitled to find that that breach entitled Dourada to the $100,000 holdback funds as partial payment of the damages award.

4) No. Dourada sold Melfi’s goods after giving Melfi the opportunity to remove them and behaved in a commercially reasonable manner when it obtained appraisals and sold a portion of the items at a public auction. The motion judge found that there was no merit to the allegation of an improvident sale.

Reeves v. Brand, 2018 ONCA 263

[Laskin, Huscroft and Paciocco JJ.A.]

Counsel:

Ryan Kniznik, for the appellant

Stephen Codas and Sarah Strathopolous, for the respondent

Keywords: Family Law, Child Custody, Relocation, Best Interests of the Child, Costs

Facts:

Ms. Brand and Ms. Reeves are the parents of a six year old boy. After Ms. Brand and Ms. Reeves separated, they litigated over custody of their son and where he should live. Ms. Brand sought joint custody and asked that Ray remain in Toronto. Ms. Reeves sought sole custody and permission to relocate with Ray to New Ross, Nova Scotia, where her parents live and where Ray has spent considerable time.

After a seven-day trial, the trial judge granted the relief Ms. Reeves asked for. He then set out a detailed access schedule, intended to give Ms. Brand “reasonable, frequent contact” with Ray and awarded her costs of the action.

Ms. Brand brought a motion to stay the trial judge’s order pending appeal. Justice Miller dismissed the motion. Ms. Brand appeals all aspects of the trial judge’s judgment.

Issues:

(1) Did the trial judge err by failing to award joint custody because he made legal and factual errors concerning the level and quality of communication between the parties?

(2) Did the trial judge err by permitting Ray and Ms. Reeves to relocate to New Ross, Nova Scotia?

(3) Was the trial judge’s access schedule unreasonable because it turns Ms. Brand into a “holiday parent” and the four-hour limitation undermines frequent contact?

(4) Did the trial judge err in principle in his costs award?

Holding: Appeal allowed, in part.

Reasoning:

(1) No. Trial judges’ decisions on custody and relocation are entitled to significant deference on appeal. Invariably, trial judges are in a better position than appellate judges to determine a child’s best interests. Ms. Brand’s challenge to the trial judge’s decisions on custody and relocation are largely an attack on his findings of fact. Those findings are reasonably supported by the record, and thus appellate intervention was not justified.

(2) No. The Court was satisfied that the trial judge sensitively balanced the competing interests of Ms. Brand and Ms. Reeves, and in permitting relocation, made an order in Ray’s best interests. This case differs from many of the relocation cases that come before the court in two important ways. First, this is not a case where relocation will sever a long-standing bond between Ray, and Ms. Brand and her family. For most of Ray’s life, he has had no bond, indeed no relationship at all, with Ms. Brand’s family. Second, this is not a case where the move to Nova Scotia will take Ray from a known home to a new and speculative environment. As the trial judge fairly observed, since he was born, Ray has been connected to Ms. Reeves’ family in New Ross and benefitted from their support. He has spent at least one-quarter of his life there. The support of the community and the Reeves family in New Ross has been part of Ray’s “status quo”. As the trial judge found, from Ray’s perspective, a relocation to New Ross is a return to what is “known” to him.

(3) Yes. The Court found that the four-hour restriction to Ray’s visits with Ms. Brand’s parents imposed by the trial judge unnecessary and contrary to his own finding on the bond between the son and Ms. Brand and her family, and not in the son’s best interests.

The trial judge gave no reasons for this restriction. The Court suspected that he imposed it because of his concerns about the attitude of Ms. Brand’s parents to their daughter’s lesbian relationship, the pregnancy, and ultimately to Ray. However, they had shown a change in attitude towards their daughter and her son.

(4) No. Although the award is sizable, it falls within the trial judge’s broad discretion over costs, and reflects no error in principle.

Bracken v. Niagara Parks Police, 2018 ONCA 261

[Doherty, LaForme and Miller JJ.A.]

Counsel:

F Bracken, acting in person

J Craig and T Khoury, for the respondent

Keywords: Constitutional Law, Canadian Charter or Rights and Freedoms, Section 2(b), Freedom of Expression, Property Law, Trespass, Provincial Offences, Disturbing Others, Using Abusive or Insulting Language, Provincial Offenses Act, R.S.O. 1990, c. P.33, Niagara Parks Act, R.S.O. 1990, c. N. 3, R. v. Batty, 2011 ONSC 6862

Facts:

On August 2, 2016, in the run-up to the U.S. presidential election, the appellant, Mr. Bracken, stood in Grand View Plaza in Niagara Parks, holding an offensive sign. Parks staff informed the Niagara Parks Police (the “NPP”), who asked him to leave and he refused. He became increasingly animated and made offensive remarks towards the officers. Eventually, one of the officers issued Mr. Bracken a summons under the Provincial Offenses Act, R.S.O. 1990, c. P.33 for two offences contrary to s. 2(9)(a) of O. Reg. 829 made under the Niagara Parks Act, R.S.O. 1990, c. N. 3 (the “Regulations”): (1) disturbing other persons and (2) using abusive or insulting language. The appellant sought declarations that (1) s. 2(9)(a) of the Regulations violates s. 2(b) of the Charter; and (2) the oral trespass notice served on him at the NPP headquarters similarly violates s. 2(b).

The application judge dismissed the application. He held that s. 2(9)(a) did not limit Mr. Bracken’s s. 2(b) Charter rights, because the constitutional guarantee of freedom of expression does not apply to shouting insulting or abusive language in the Parks. He declined to determine whether the oral trespass notice infringed s. 2(b), as he was not satisfied that a trespass notice had in fact been issued. Mr. Bracken appeals both aspects of the judgment.

Issues:

1. Did the application judge err in not finding that s. 2(9)(a) of the Regulations infringes s. 2(b) of the Charter?

2. Did the application judge err in not granting a declaration quashing the oral trespass notice?

Holding:

Appeal allowed in part.

Reasoning:

1. No. Section 2(9)(a) provides: “(9) … no person shall, within the Parks (a) use abusive or insulting language, or conduct himself or herself in the Parks in a manner that unnecessarily interferes with the use and enjoyment of the Parks by other persons”. The Court found that this restriction was limited to the use of abusive or insulting language that interferes with a patron’s use of the parks. The Court also found that the abusive language referred to in section 2(9)(a) constituted expression for the purpose of 2(b) of the Charter, and that section 2(9)(a) limited this expression. However, the Court subsequently undertook a section 1 analysis and found that the limitation prescribed by Section 2(9)(a) was justified.

2. Yes. Both parties take the position that when Mr. Bracken attended at NPP headquarters on August 4, an NPP officer, Mr. Forcier, delivered an oral trespass notice to Mr. Bracken: he was not to return to the Parks with his sign. If he did, he would be arrested and removed from the premises. Mr. Bracken attended at the station on August 4 specifically to clarify whether, on the NPP’s understanding of the law, he was permitted to display his sign. Inspector Forcier told him that he was not and that he would be arrested and removed if he did so. This disagreement about his legal rights was the impetus for Mr. Bracken to bring this proceeding in the first place, challenging the trespass notice as an infringement of his Charter rights. In the circumstances of this multi-pronged and on-going dispute between the parties, it was an error for the application judge not to bring some clarity by issuing a declaration quashing the trespass notice. Unlike the protesters in R. v. Batty, 2011 ONSC 6862, who essentially converted a public park to their exclusive use, this was an instance of a single person, standing on a sidewalk at the edge of a public, semi-commercial plaza within a park, holding a sign displaying a political message. In this instance, it is conceded that there were no circumstances that would justify the removal of a single protester with a sign from a busy plaza, and that the display of the sign, despite its profanity, did not constitute the use of insulting or abusive language within the meaning of s.2(9)(a).

A.C. Concrete Forming Ltd. v. JAC Concrete Structures and  Drain Inc., 2018 ONCA 272

[Simmons and Pepall JJ.A. and Fragomeni J. (ad hoc)]

Counsel:

D Touesnard, for the appellants

A Pilieci, for the respondent

Keywords: Contracts, Oral Agreements, Civil Procedure, Offers to Settle, Enforcement, Summary Judgment, Rules of Civil Procedure, Rules 20 and 49

Facts:

On a motion to enforce a settlement, the motion judge found that following a meeting, the respondent (A.C. Concrete Foaming Ltd.), by its counsel, and Ms. Tavares, litigation administrator and executor of the then deceased personal defendant, entered into a verbal settlement agreement. The motion judge concluded that Rule 49 had no application in the circumstances. Rather, she determined that the motion before her was akin to a summary judgment motion. Counsel for the appellants did not object to her proceeding on that basis.

Although there was conflicting evidence on the motion concerning whether a settlement agreement had been reached, the motion judge concluded it was appropriate to proceed in the interests of efficiency and access to justice and that oral evidence was unnecessary to assess credibility of the conflicting witness statements. Ultimately, the motion judge accepted the respondent’s evidence that a settlement had been reached and rejected the appellants’ evidence that it had not.

Issues:

(1) Did the motion judge err in failing to apply the two-part test under Rule 49.09 in determining whether the settlement should be enforced?

(2) Did the motion judge err in finding that there was no genuine issue regarding whether the parties intended to create a legally binding agreement?

(3) Did the motion judge err in failing to consider, by analogy to the Rule 49 test, whether any settlement agreement that may have been reached should be enforced?

Holding: Appeal dismissed.

Reasoning:

(1) No. No Rule 49 offers were served.  Accordingly, on a proper reading of Rule 49, it does not apply to this case. The motion judge was correct in making this determination.

(2) No. The motion judge carefully considered and gave detailed reasons for finding that there was a legally binding agreement. The appellants have demonstrated no palpable and overriding error in this finding.

(3) No. It was not made in the court below.  In any event, even assuming a two-part test is applicable, on reading the motion judge’s decision, it is clear that the motion judge fully considered all relevant factors impacting whether the settlement should be enforced.

Ligaj v. Ismail, 2018 ONCA 271

[Simmons and Pepall JJ.A. and Fragomeni J. (ad hoc)]

Counsel:

B A Cook and R Runge, for CUMIS General Insurance Company

A R. Camporese and S Coons, for Sherif Ismail

Keywords: Torts, Negligent Entrustment, Insurance Law, Automobile Insurance, Uninsured Motorists, Driving with Consent of Owner

Facts:

Following the first phase of a bifurcated trial, the trial judge concluded that Nihad Ismail drove the vehicle of his father, Sherif Ismail, without consent, either express or implied. The trial judge also found that the appellant, CUMIS General Insurance Company, failed to prove the tort of negligent entrustment against Sherif Ismail, if that tort even exists in Ontario. On appeal, CUMIS argued that the trial judge made palpable and overriding errors in her factual findings and that she further erred in failing to find it had established the tort of negligent entrustment.

Issues:

1. Did the trial judge make a palpable and overriding error in her findings of fact?

2. Did the trial judge err in failing to find that CUMIS had established the tort of negligent entrustment?

Holding: Appeal dismissed.

Reasoning:

1. No. Cumis argued that there was evidence that Sherif Ismali was chalking the tires of his Honda because he suspected that his son would take the vehicle. The Court of Appeal disagreed. The Court noted that the appellant misinterpreted the trial judge’s finding. The trial judge did not dispute that Sherif Ismail was chalking the tires, but found no evidence that he was doing so because of Nihad Ismail.

2. No. The trial judge found that Nihad Ismail drove his father’s vehicle without his father’s consent, either express or implied. Without deciding whether or not the tort of negligent entrustment exists in Ontario, the Court of Appeal found that even if it did exist it, could not be established in the face of the trial judge’s findings that there was no implied consent.

Barker v. Barker, 2018 ONCA 255

[Simmons and Pepall JJ.A. and Fragomeni J. (ad hoc)]

Counsel:

William D. Black and Sam Rogers, for the appellants Elliot Thompson Barker and Gary J. Maier

Sara Blake and Meagan Williams, for the appellant Her Majesty the Queen in Right of Ontario

Joel P. Rochon, Peter R. Jervis and Golnaz Nayerahmadi, for the respondents

Keywords: Torts, Battery, Negligence, Breach of Fiduciary Duty, Civil Procedure, Class Actions, Summary Judgment, Procedural Fairness, Limitation Periods, Laches, Statutory Interpretation, Retroactivity, Limitations Act, 2002, S.O. 2002, c. 24, Sch. B, s. 16(1)(h.2)

Facts: The appellants, Elliott Thompson Barker, Gary J. Maier and Her Majesty the Queen in Right of Ontario (the “Crown”), appeal from the order of the motion judge in which he  dismissed the appellants’ motions seeking to have the respondents’ action dismissed as statute-barred or barred by the doctrine of laches; granted the respondents partial summary judgment for breach of fiduciary duty; and ordered a trial or additional summary judgment motions to prove victimization, harm, causation of harm and quantification of damages. The appellants also seek leave to appeal the motion judge’s costs order in favour of the respondents.

The respondents were patients committed to the Oak Ridge Division of the Mental Health Centre in Penetanguishene, Ontario, at various times between 1966 and 1983. They were subjected to intensive therapy programmes designed in part by the appellant, Dr. Barker, for Oak Ridge’s Social Therapy Unit which he and the appellant, Dr. Maier, oversaw. In 2000, one of the respondents commenced a proposed class action. The claims included breach of fiduciary duty, battery, negligence and contravention of common law principles and international law norms relating to the use of torture and cruel, inhumane or degrading treatment and punishment. The respondents have also alleged there was a lack of informed consent. The pleading asserts that patients at Oak Ridge were forced to participate in experiments that involved both psychological and physical torture. Certification of the class proceeding was denied in 2003 and, after an unsuccessful appeal, a motion was granted in 2006 to allow the action to continue as a multi-party proceeding.

The motion judge, who was managing the action, established a schedule for delivery of the appellants’ summary judgment material and a cross-motion to be brought by the respondents for summary judgment. The motion judge subsequently heard the appellants’ summary judgment motions. In his written reasons he noted that during the course of argument, he had advised the parties that he was of the view that there were four ways of deciding the motions. However, while writing his reasons, the motion judge decided to resolve the motions on a fifth basis: he would grant a notional cross-motion by the respondents for partial summary judgment of their claim for breach of fiduciary duty and order a trial or additional summary judgment motions to prove victimization, harm and causation of harm, and to quantify the individual respondents’ damages, if any.

Issues:

(1) Did the motion judge deny the appellants procedural fairness and err by granting partial summary judgment for breach of fiduciary duty?

(2) Did the motion judge err in dismissing the appellants’ motions and in concluding that the respondents’ claims were not statute-barred?

Holding: Appeal allowed.

Reasons:

(1) Yes. The motion judge had directed that the appellants’ motions proceed on the basis that liability was assumed. Given this direction, the appellants could not have reasonably expected that partial summary judgment for breach of fiduciary duty would be granted. At no time had the appellants conceded liability. The appellants’ statements of defence disputed the allegations of what occurred and the nature of the respondents’ experience at Oak Ridge and the motions judge erred in concluding otherwise. Moreover, the parties had not placed the evidentiary foundation for such an order before the motion judge. Nor, based on the procedure established by the motion judge, would they have expected that they would be denied the opportunity to advance argument on whether any fiduciary duty was owed and if so, whether it was breached.

In addition, at the hearing of the motions themselves, the motion judge had outlined for the parties the potential avenues for disposition of the motions. However, his fifth alternative of devising a notional cross-motion for partial summary judgment by the respondents for their claim of breach of fiduciary duty, which was never raised with the parties, amounted to a denial of procedural fairness. The relief granted was inconsistent with the December direction and also denied the appellants the opportunity to file evidence and make submissions on the issue.

(2) No. It would appear from the directions, the appellants’ motions for summary judgment, the motions judge’s reasons and the order itself that the motion judge was responding to a motion for summary judgment, not a Rule 21 motion. Indeed, the notices of motion, originally prepared prior to the December direction, were re-served and relied upon by the appellants for the purposes of the motions heard by the motion judge. In their notices of motion, the appellants stated that the motions were for “[s]ummary judgment dismissing this action as against the defendant physicians [and as against the Crown] on the basis there is no genuine issue requiring a trial as the action against them [and the Crown] is statute-barred” or, in the alternative, is “barred by the doctrine of laches”. Accordingly, it was incumbent on the appellants as moving parties to show that there was no genuine issue requiring a trial. The appellants did not meet this burden.

The application of the limitation periods and the laches doctrine advanced by the appellants requires a characterization of the conduct of the appellants and the relationship between the parties. The parties proceeded on the assumption that the appellants’ liability was established. The respondents’ pleading included very serious allegations of torture and degradation of human dignity. The motion judge, who has case managed the action for several years, concluded that the limitation period statutes do not encompass an action based on breach of fiduciary duty where the act of professional practice or experimentation is torture.

Based on the procedure adopted by the parties and the court, the appellants failed to show that there was no genuine issue requiring a trial on the breach of fiduciary duty limitation and laches issues. These issues do not simply engage questions of law; rather, they require factual determinations, on a proper record, on the nature and characterization of the appellants’ conduct and the relationship between the parties.

As for the causes of action other than breach of fiduciary duty (battery, negligence and breaches of common law and international norms), the appellants argue that it is implicit in the motion judge’s reasons that he decided the limitations issues in their favour. The motion judge’s reasons make it clear he did not fully analyze the respondents’ arguments in this regard, including arguments concerning the retroactive application of s. 16(1)(h.2) of the Limitations Act, mental incapacity, and the doctrine of discoverability. The applicable limitations periods, if any, for the other causes of action are best dealt with at trial, along with the applicable limitation period, if any, for the breach of fiduciary duty claim.

The motions judge’s order is varied, and the action is remitted for trial or summary trial as deemed appropriate to the Regional Senior Judge for the assignment of a trial judge.

Dunk v. Kremer, 2018 ONCA 274

[Sharpe, Juriansz and Miller JJ.A.]

Counsel:

A Rachlin, for the appellant

P J Pape, for the respondent

Keywords: Torts, Negligence, MVA, Civil Procedure, Expert Reports, Rules of Civil Procedure, Rule 53, Jury Trials, Closing Address, Damages

Facts:

During the trial of this personal injury action resulting from a motor vehicle accident, the appellants (Kremer) retained an expert but did not provide the respondent (Dunk) with a signed Rule 53 report until part-way through the trial. The appellants did not indicate that they would be calling their expert, Dr. Rizek, although they had given the respondent an unsigned copy of his report after the respondent’s orthopedic expert, Dr. Daniels, had testified, the appellants moved for an order permitting them to call their expert. The trial judge ruled that the expert could be called despite the non-compliance with Rule 53, but that he would be restricted to the four corners of his report. In particular, he would not be permitted to comment on developments that had arisen after he had prepared his report. The respondent’s experts had served supplementary reports in view of updated medical information and the appellants’ expert had not filed a response. On appeal, the appellants say this order unfairly limited the scope of Dr. Rizek’s evidence as he was unable to comment on Dr. Daniels’ oral evidence regarding the high probability the respondent would develop arthritis in her upper ankle joint necessitating a fusion of that joint as well leaving her “quite disabled”. Dr. Rizek’s report had not addressed that matter.

Moreover, the trial judge found that the closing address of the respondent’s trial counsel was inappropriate and inflammatory. Of particular concern were counsel’s comments regarding the limitations of Dr. Rizek’s evidence. The mistrial motion was argued for a full day and the trial judge explained in her reasons why she had concluded that the mischief of the closing could adequately be dealt with by a correcting instruction. She prepared and reviewed with counsel a detailed instruction touching on the most significant areas of complaint.

With respect to damages, the trial judge discussed with counsel the ranges they intended to offer the jury before they made their closing addresses. Appellants’ trial counsel submitted that there was no authority to support the respondent’s proposed range. The trial judge observed that there was no case on all fours. In the absence of any authority that the respondent’s proposal was outside an accepted or established range, she declined to offer any comment. She did, however, modify her proposed charge by adopting some of the language suggested by counsel for the appellant.

Issues:

(1) Did the trial judge err in restricting the scope of testimony of the appellants’ expert?

(2) Did the trial judge err in failing to declare a mistrial as a consequence of inappropriate closing submissions by the respondent’s trial counsel?

(3) Did the trial judge err in failing to provide sufficient guidance to the jury on the appropriate range for non-pecuniary damages?

(4) Does the cumulative effect of the alleged errors warrant a new trial?

Holding: Appeal dismissed.

Reasoning:

(1) No. This situation was largely the creation of the appellants and the Court saw no error on the part of the trial judge in ruling as she did. The appellants were slow to deliver a proper Rule 53 report or to indicate that the expert would be called. They had the appellants’ experts’ supplementary reports well in advance of trial and failed to have Dr. Rizek respond. As the trial judge observed, if Dr. Rizek were allowed to give evidence on developments not discussed in his report, it might require the respondent to split her case, recall her expert and incur significant additional expense and possible trial delay. This was a discretionary decision for the trial judge to make. She gave clear and cogent reasons in her ruling and the Court saw no ground for appellate intervention.

(2) No. It is well-established that the trial judge is in the best position to determine whether a mistrial is required to deal with an inflammatory closing address. A mistrial is the remedy of last resort and the trial judge’s decision to deal with the matter by way of instruction rather than mistrial attracts deference. The trial judge gave a very clear and strong instruction to the jury to disregard the problematic portions of counsel’s closing. The trial judge carefully itemized the objectionable aspects of the closing and clearly directed the jury to ignore those passages, explaining how and why counsel had gone astray. At the end of the day, the Court was not persuaded that when the record was considered as a whole, there was a miscarriage of justice requiring a new trial.

(3) No. This was a matter for the trial judge’s discretion. The respondent was only 18 years old at the time of the accident and there was evidence that it was going to cause her significant and serious long-term pain and impairment. She had already suffered several years of pain. The restriction imposed by the injury had caused her to alter her post-secondary education and career plans, and interfered with her day-to-day activities. It was likely that further surgery would be required and the respondent faced the prospect of increasing and indeterminate pain and impairment from arthritis as she aged. In these circumstances, the trial judge did not err in law in declining to comment on the range for general damages suggested by the respondent’s counsel. Nor did the Court agree that the jury’s award was so inordinately high as to call for appellate intervention. Given the deference accorded to jury damage assessments, the nature of the injury and the likelihood that, in the words of the appellant’s expert, she would likely require further surgery in the future that would leave her “quite disabled”, there is no basis for the Court to interfere.

(4) No. There is not a “synergy” to the alleged errors and their cumulative effect does not warrant a new trial.

Pey v. Pey, 2018 ONCA 284

[Hoy A.C.J.O., Juriansz and Miller JJ.A.]

Counsel:

Carol Craig, for the respondent, Kristina Pey

Deann Nixon, for the respondent, Director, Family Responsibility Office

Keywords: Family Law, Orders, Support, Enforcement, Striking Motions, Committal for Non-Payment, Family Responsibility Office

Facts:

The father appeal’s from an order striking his motion requesting a variation of the trial judge’s order and the order of Justice Doyle addressing access. The motion judge’s order striking the father’s motion also granted a motion by the Family Responsibility Office (FRO) ordering the father to pay lump sum amounts within specified time periods, in default of which the FRO was entitled to bring a motion for committal, on notice to the father, for imprisonment of the father for up to 180 days.

Issues:

(1) Did the motion judge err in striking the father’s motion and granting the FRO’s motion?

Holding:

Appeal dismissed.

Reasoning:

(1) No. The motion judge struck the father’s motion on the basis of his non-compliance with several court orders. The motion judge found that the father had the means to comply with these court orders but that they simply had not been a priority for him. It would not be appropriate to provide the father an opportunity to request relief from the Court when he had chosen to ignore the orders of the Court, which gave relief to the mother. The motion judge applied the proper principles in deciding a motion to strike under rule 1(8) of the Family Law Rules. The motion judge was also correct to grant the order of the FRO, noting that “the father has the ability to pay the child and spousal support he owes but to date, he [has] chosen not to do so.”

Weenen v. Biadi, 2018 ONCA 288

[Epstein, Hourigan and Paciocco JJ.A.]

Counsel:

Sarah Turney and Anastasia Reklitis, for the moving party, Fasken Martineau DuMoulin LLP

Yan David Payne, for the responding party, Matthew Weenen

Keywords: Contracts, Solicitor and Client, Unpaid Legal Fees, Charging Orders, Solicitors’ Liens, Solicitors Act, R.S.O. 1990, c. S.15, s. 34, Appellate Jurisdiction, Courts of Justice Act, R.S.O. 1990, c. C.43, ss. 13(2) and 134(1)

Facts:

Fasken Martin DuMoulin LLP (the “Law Firm”) represents the plaintiff (the “Client”). The Law Firm brought a motion for a charge or lien in the amount of $360,836.88 on the funds the defendant was ordered to pay the plaintiff for fees due by the Client.

Issues:

(1) Does the Court of Appeal have jurisdiction to make an order for a charge or lien?

(2) Is the Law Firm entitled to either a charge or lien?

Holding:

Motion denied.

Reasoning:

(1) Yes. A court’s inherent jurisdiction to declare a lien on the proceeds of its own judgments is well-established. It follows that the Court has the inherent jurisdiction to grant, when warranted, a solicitor’s lien over the $50,000 in costs awarded in favour of the Client on the appeal. The Court also has jurisdiction to issue a charging order under the Solicitors Act, R.S.O. 1990, c. S.15. A judge in the Court of Appeal is a judge of the Superior Court with all of the jurisdiction, power and authority of a judge of that court under s. 13(2) of the Courts of Justice Act, R.S.O. 1990, c. C.43 and under s. 134(1) of that Act, may make any order or decision that could have been made by the court appealed from.

(2) No. To grant either a charge under s. 34 of the Solicitors Act or a lien, the solicitor must demonstrate:

  1. the fund or property is in existence at the time the order is granted;
  2. the property was “recovered or preserved” through the instrumentality of the solicitor; and
  3. there must be some evidence that the client cannot or will not pay the lawyer’s fees.

The Law Firm failed to successfully discharge its burden of establishing that it will likely not be paid without a charging order or lien. The Client had made payments on three of four occasions on which the Law Firm requested payment. The fact that the Client contests the amount he owes the Law Firm is not evidence of his inability or unwillingness to pay.

The Catalyst Capital Group Inc. v. Moyse, 2018 ONCA 283

[Doherty, MacFarland and Paciocco JJ.A.]

Counsel:

B H Greenspan, D C Moore and M Biddulph, for the appellant

R A Centa, K Borg-Olivier and D Cooney, for the respondent, Brandon Moyse

K E Thomson, M Milne-Smith and A Carlson, for the respondent, West Face Capital Inc.

Keywords: Torts, Breach of Confidence, Spoliation, Costs, Substantial Indemnity

Facts:

The appellant, The Catalyst Capital Group Inc. (“Catalyst”), and the respondent, West Face Capital Inc. (“West Face”), two investment management firms, made separate efforts to acquire WIND Mobile Inc. (“WIND”) in 2014. In early August, it appeared that Catalyst and the principal shareholder of WIND had reached an agreement for the sale of WIND to Catalyst. Within days, that agreement had fallen apart and West Face, along with other entities (the “consortium”) had come forward with a new, and eventually, successful bid for WIND. The consortium and West Face later sold WIND for a very substantial profit to Shaw Communications.

In this lawsuit, Catalyst alleged that West Face effectively “stole” the WIND deal from Catalyst by improperly using confidential information West Face obtained about Catalyst’s strategies in respect of its negotiations for the purchase of WIND. According to Catalyst’s claim, the confidential information came from the respondent, Brandon Moyse (“Mr. Moyse”). He had worked for Catalyst as an analyst for about two years until May 2014, when he quit Catalyst to go to work for West Face. Catalyst sued for misuse of confidential information and spoliation; the latter as a result of allegations that Mr. Moyse destroyed evidence contained on his cellphone and personal computer.

The trial judge dismissed the case and Catalyst appealed arguing (1) that there were errors in the trial judge’s fact-finding process; (2) procedural unfairness; and (3) that the trial judge erred in his analysis of the spoliation claim.

Issues:

1. Did the trial judge err in his fact-finding process?

2. Was there procedural unfairness?

3. Did the trial judge err in his analysis of the spoliation claim?

4. Did the trial judge err in his assessment of costs?

Holding:

Appeal dismissed.

Reasoning:

1. No. The trial judge’s findings of fact turned on his assessment of the credibility of the key witnesses, the reliability of their evidence, and the inferences to be drawn from certain primary findings of fact. His determinations are owed strong deference on appeal. The appellants argued that the trial judge demonstrated an uneven scrutiny in his weighing of witness testimony, leading him to conclude that the appellant’s witness was not credible while giving Mr. Moyse the benefit of the doubt for what the appellants described as egregious misconduct.

The trial judge approached the evidence of the respondents’ witnesses no differently than he did the evidence of the appellant’s witnesses. The trial judge’s reasons must be considered in their entirety. Mr. Moyse’s evidence that he did not provide confidential information concerning the WIND negotiations to West Face did not stand alone. The evidence found considerable, largely uncontradicted support in the testimony of the West Face witnesses. It also gained some inferential support in the trial judge’s findings as they related to the West Face strategy in respect of the WIND negotiations, and the ultimate reason for the breakdown of the negotiations between the appellant and the vendor of the WIND shares. The Court of Appeal therefore rejected this argument.

The appellants also argued that the trial judge misapprehended evidence. The Court of Appeal found no such misapprehension.

2. No. The appellant argued that the trial judge made a series of factual findings against the appellant in respect of the dealings between the vendor of the WIND shares and West Face and the consortium in August 2014. The appellant argued that these findings were made despite the trial judge having refused to allow the appellant to amend its claim to allege that West Face had induced the vendor of the WIND shares to breach its agreement with the appellant in the course of those August dealings. The appellant contended that the trial judge’s findings were beyond the scope of the claim as framed in the pleadings before him and were based on an inadequate evidentiary record. The Court of Appeal rejected this argument. The appellant did not move in this proceeding to amend its claim to include an allegation that West Face induced the vendor of the WIND shares to breach its contract with the appellant. The appellant did unsuccessfully seek to make that amendment in a related proceeding but that refusal had no impact on the conduct of the trial.

3. No. The appellants argued that the trial judge erred in holding that an adverse evidentiary inference could be drawn against the respondents as a result of Mr. Moyse’s destruction of relevant evidence only if the appellant established that Mr. Moyse and/or West Face destroyed that evidence for the specific purpose of affecting the outcome of the litigation. Counsel submitted that the adverse inference was appropriately drawn if relevant evidence was destroyed in the face of pending or reasonably foreseeable litigation. Any inference that may be drawn against the respondents can arise only after a finding that Mr. Moyse destroyed relevant evidence. The trial judge found as a fact that Mr. Moyse did not destroy relevant evidence. Therefore this ground of appeal was also dismissed.

4. No. The appellant appealed the trial judge’s costs award, which was determined to be on a substantial indemnity basis. The Court of Appeal upheld the order. The trial judge awarded costs to West Face on a substantial indemnity basis because the appellant had made serious and unfounded allegations impugning the honesty and integrity of West Face and its senior executives. He concluded that the lawsuit was precipitated primarily by Mr. Glassman’s frustration over losing out on the acquisition of the WIND shares. The appellant chose to make very serious allegations against West Face, maintain those allegations in the face of substantial evidence refuting the allegations, and in the end “utterly failed” to substantiate any of the claims. Accordingly, this was a case that warranted costs on a substantial indemnity scale.

2363523 Ontario Inc. v. Nowack, 2018 ONCA 286

[Brown J.A. (In Chambers)]

Counsel:

Paul Slansky, for the moving party

Norman Groot, for the responding party

Keywords: Civil Procedure, Extension of Time, Security for Costs, Yaiguaje v. Chevron Corporation, 2017 ONCA 827, Courts of Justice Act, R.S.O. 1990, c. C.43, to ss. 7(5), Rules of Civil Procedure, R. 61.16(6).

Facts:

The appellant, Steven Nowack, is appealing the order of Dunphy J. dated June 30, 2017, which imposed a further term of imprisonment of 21 days for contempt. In that appeal, Hoy A.C.J.O. made an order dated December 6, 2017, requiring the appellant to post security for costs of $10,000 within 30 days (the “Order”). The appellant seeks an extension of time to file a notice of motion for a panel review of the Order pursuant to s. 7(5) of the Courts of Justice Act, and Rule 61.16(6) of the Rules of Civil Procedure. The respondent vigorously opposes the motion.

The appellant served respondent’s counsel with a notice of motion on January 10, 2018. However, Rule 61.16(6) required the service and filing of the notice of motion within four days after the Order was made, that is by December 10, 2017.

Issues:

(1) Should an extension of time be granted to file a notice of motion for a panel review of the Order pursuant to s. 7(5) of the Courts of Justice Act?

Holding: Motion granted.

Reasons:

1. Yes. Motions for the extension of time to file a court document require looking at several factors. Most importantly, they require looking at the justice of the case in all the circumstances. The appellant formed an intention to seek a review of the security for costs order shortly after it was made. The appellant moved with some dispatch to serve and file a notice of motion to review, albeit outside the very short four-day service window in the Rules. Further, the underlying appeal engages the liberty of the subject, and two judges of the court have described the merits of the appeal from the order of Dunphy J. as “not frivolous” and having merit.

Additionally, although orders for security for costs are discretionary in nature and usually entitled to deference, a panel of court in Yaiguaje v. Chevron Corporation recently reversed an order for security for costs because the chambers judge had “erred in principle in determining the justness of the order sought”. It therefore is difficult to predict the degree of deference that a panel will afford to any particular order for security for costs made by a single judge.

Rule 3.02(1) states that the court may extend any prescribed time “on such terms as are just.” As a general practice, motions to a panel to review an order of a single judge of the Court of Appeal are heard orally. Due to concerns about further delays in the appeal, it was directed that the appellant’s review motion be heard by a panel of the court in writing.

Justice Brown lamented an apparent increase in motions seeking panel reviews of decisions made by single judges of the Court of Appeal as follows:

“In fashioning this remedy, I am influenced by the most unfortunate, but increasing, practice of parties seeking panel reviews of single judge decisions pursuant to s. 7(5) of the CJA. That provision, quite unintentionally, is now fuelling the emergence of a motions culture in this court. Decisions of single judges on the simplest of procedural matters, such as the extension of time, now prompt a further motion demanding an “internal appeal” of the decision to a panel. Motion time is heaped upon motion time, which delays hearing an appeal on its merits.”

Brown v. Woodstock (Police Services Board), 2018 ONCA 275

[Rouleau, Huscroft and Fairburn JJ.A.]

Osborne G. Barnwell and Darryl Singer, for the appellant

Brian McCall and Beth Belanszky, for the respondents

Keywords: Torts, Battery, Wrongful Arrest, Unlawful Search and Seizure, Wrongful Detention, Civil Procedure, Limitation Periods, Discoverability, “Appropriate Means”, Limitations Act, 2002, s. 5(1), Winmill v. Woodstock (Police Services Board), 2017 ONCA 962

Facts:

The appellant (Everton Brown) was arrested by the respondent police officers on February 13, 2013. Subsequently he was prosecuted for possession of crack cocaine, possession for the purpose of trafficking, possession of the proceeds of crime, and resisting arrest. On October 22, 2015, the appellant entered into a peace bond and the charges against him were withdrawn. The appellant commenced this civil action against the respondents on May 13, 2016.

The motion judge applied case law holding that a claim for damages for false arrest, false imprisonment, and breach of Charter rights crystallizes on the date of arrest, and that the limitation period for an assault or battery runs from the date the assault or battery occurs. He concluded that the appellant had sufficient facts within his knowledge on the day he was arrested – February 13, 2013 – and as a result, his action was commenced well outside the two-year limitation period. The motion judge dismissed the claim as statute-barred.

Issues:

(1) Did the motion judge err by finding that the appellant’s claim crystalized on the date of arrest, and that the limitation period for an assault or battery runs from the date that the battery or assault occurs?

Holding: Appeal allowed.

Reasoning:

(1) Yes. The motion judge applied existing case law in coming to his decision. However, the parties were permitted to file supplementary factums in light of the Court of Appeal’s decision in Winmill v. Woodstock (Police Services Board), 2017 ONCA 962, which was released following the motion judge’s decision.

Winmill cannot be distinguished from this case on the basis that the charges in this case are different, or that the prosecution of the appellant ended with his entering into a peace bond rather than an acquittal. Nor is it relevant that Winmill was also concerned with a claim for negligent investigation. The key point is that, as in Winmill, the battery action is essentially a mirror image of the criminal charge of resisting arrest that the appellant was facing. As a result, it was open to the appellant to await the outcome of the criminal proceedings against him before finally deciding whether to bring his action, regardless of when he first formed the intention to sue. Specifically, the discovery date for the appellant’s action was October 22, 2015 – the date the criminal charges him were brought to a conclusion with a peace bond (see ss. 5(1)(a)(iv) of the Limitations Act, 2002, SO 2002, c 24, Schedule B – commencing a proceeding being an “appropriate means” to seek a remedy). The appellant had two years from that date in which to bring his action. Therefore, the appellant’s action, which was commenced May 13, 2016, was in time.

Huang v. Fraser Hillary’s Limited, 2018 ONCA 277

[Strathy C.J.O. (Motion Judge)]

Counsel:

Sarah McDonald and Kaitlyn Mitchell, for the proposed intervener Ecojustice

Michael S. Hebert, for the appellant Eddy Huang

Jeremy R. Rubenstein, for the respondent David Hillary

Michael S. Rankin and Jonathan O’Hara, for the respondent Fraser Hillary’s Limited

Keywords: Torts, Nuisance, Trespass, Negligence, Strict Liability (Rylands v. Fletcher (1868), L.R. 3 H.L. 330 (U.K. H.L.)), Environmental Contamination, Environmental Protection Act, R.S.O. 1990, s. 99, Civil Procedure, Interveners, Rules of Civil Procedure, Rule 13.02, Peel (Regional Municipality) v. Great Atlantic & Pacific Co. of Canada Ltd. (1990), 74 O.R. (2d) 164 (C.A.)

Facts:

Ecojustice moves for leave to intervene in this appeal by the plaintiff, Mr. Huang, as a friend of the court pursuant to Rule 13.02 of the Rules of Civil Procedure. The judgment appealed from held Fraser Hillary’s Limited liable in nuisance and under the Environmental Protection Act (“EPA”) for approximately $1.8 million in damages arising from the contamination of Mr. Huang’s land by pollutants from the dry cleaning business of Fraser Hillary’s Limited. Claims in trespass, negligence and under the rule in Rylands v. Fletcher were dismissed. The claims against Mr. Hillary personally were also dismissed.

Issue: Should Ecojustice be granted leave to intervene in this appeal as a friend of the court?

Holding: Motion dismissed.

Reasoning:

No. The considerations on a motion to intervene are set out in Peel (Regional Municipality) v. Great Atlantic & Pacific Co. of Canada Ltd. They are as follows:

(a) the nature of the case;

(b) the issues that arise; and

(c) the likelihood that the proposed intervener will be able to make a useful contribution    to the resolution of the appeal without causing injustice to the immediate parties.

(a) Nature of the case: The standard to be met by the proposed intervener is more onerous where the litigation is a private dispute as opposed to a public prosecution. This case falls into the former category. It is fundamentally private litigation in which one of the parties, Mr. Huang, claimed that the other parties polluted his property.

(b) The issues that arise: The issues concern the application of well-settled, in fact ancient, causes of action: trespass, negligence and nuisance. There is also an issue concerning the application of a statutory provision: s. 99(2) of the EPA. Intervention may be warranted in some cases where the construction or application of important legislation – particularly a provision such as this, which has received little judicial interpretation – is at issue. Significantly, however, this provision is not a major focus of the proposed intervention. Ecojustice proposes to make “brief submissions” about the appropriateness of rebutting the presumption against the retrospective application of the provision. The Court was not satisfied that Ecojustice’s participation will materially assist.

(c) Useful contribution without causing injustice: The Court was not satisfied that the proposed intervention would assist in any meaningful way. Many of Ecojustice’s submissions on the common law causes of action simply recast the submissions made by the parties themselves.

Short Civil Decisions

FCI Concrete Forming Inc. v. Buttcon Limited, 2018 ONCA 268

[Feldman, Watt and Paciocco JJ.A.]

Tony Van Klink, for the appellants

Daniel Shields and Hendrick Nieuwland, for the respondents

Keywords: Labour Law, Conspiracy to Injure, Stay, Labour Relations Act, 1995, S.O. 1995, c. 1, Sched. A, s. 76, Appeal Dismissed

Holmes v. Stockton Estate, 2018 ONCA 273

[Simmons and Pepall JJ.A. and Fragomeni J. (ad hoc)]

Counsel:

Todd D. Storms, for the appellants

Allen Wilford, for the respondent

Keywords: Real Property, Mortgages, Debtor-Creditor, Family Law, Estates, Bankruptcy and Insolvency, Fraudulent Conveyances, Child Support

Rutman v. Rabinowitz, 2018 ONCA 279

[Cronk, Huscroft and Nordheimer JJ.A.]

Helen A. Daley and Michael Finley, for the appellants Moishe Bergman and Artcraft Company Inc.,

John J. Adair, for the appellant Saul Rabinowitz

Keywords: Costs, Substantial Indemnity

S.N.S Industrial Products Limited v. Omron Canada Inc., 2018 ONCA 278

[MacFarland, Huscroft and Nordheimer JJ.A.]

John W. McDonald, for the appellant

Robert E. Kwinter & Nicole Henderson, for the respondent

Keywords: Contracts, Summary Judgment, Fresh Evidence, Appeal Dismissed

Alguire v. The Manufacturers Life Insurance Company (Manulife Financial), 2018 ONCA 280

[Feldman, Cronk and Hourigan JJ.A.]

Peter Griffin, Warren Rapoport and Aryan Ziaie, for the appellant

Robert Harrison and Chad Pilkington, for the respondent

Keywords: Endorsement, Costs, Partial Indemnity

Haque v. St. Joseph’s Health Centre, 2018 ONCA 285

[Hoy A.C.J.O., Juriansz and Miller JJ.A.]

Mahfuzul Haque, appearing as self-represented

Naveen Hassan, for the respondents

Keywords: Civil Procedure, Striking Pleadings, No Reasonable Cause of Action, Rules of Civil Procedure, Rule 2.1.01(6), Appeal Dismissed

Johnson v. Menezes, 2018 ONCA 287

[Hoy A.C.J.O., Juriansz and Miller JJ.A.]

David Harris-Lowe, for the appellant

Elizabeth Sachs, for the respondent

Keywords: Family Law, Custody, Retroactive Child Support, Default Judgments, Appeal Allowed in Part

Aminzada v. Wal-Mart Canada Corp., 2018 ONCA 269

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

Joel P. McCoy, for the appellant

Donna Polgar, for the respondents

Keywords: Torts, Negligence, Standard of Care, Appeal Dismissed

Lemesani v. Lowerys Inc., 2018 ONCA 270

[Simmons and Pepall JJ.A. and Fragomeni J. (ad hoc)]

Jordan Lester, for the appellant

Roderick W. Johansen, for the respondent

Keywords: Employment Law, Wrongful Dismissal, Constructive Dismissal, Appeal Dismissed

Universal Health Group Inc. v. Limmex AG, 2018 ONCA 289

[MacFarland, Huscroft and Nordheimer JJ.A.]

Patricia Virc, for the appellant

Matthew Latella and Glen Gibson for the respondents

Keywords: Endorsement, Appeal Dismissed

Manulife Bank of Canada v. Holden-Khan, 2018 ONCA 297

[MacFarland, Huscroft and Nordheimer JJ.A.]

Lutful Khan, acting in person

Natalie Marconi, for the respondent

Keywords: Mortgages, Fresh Evidence, Property Tax, Appeal Dismissed

Nichols v. Closs Jr., 2018 ONCA 295

[MacFarland, Huscroft and Nordheimer JJ.A.]

Ralph Lee, for the appellant

David Heeley, for the respondent

Keywords: Estates, Life Interests, Appeal Dismissed

Ontario Review Board Decisions

Mitchell (Re), 2018 ONCA 267

[Feldman, Watt and Paciocco JJ.A.]

Jessica Zita, for the appellant Stacey Mitchell

Andrew Cappell, for the Attorney General of Ontario

Keywords: Ontario Review Board, Community Living, Public Safety, Appeal Dismissed

Criminal Decisions

R v. Jennings, 2018 ONCA 260

[Watt, Hourigan and Miller JJ.A.]

David Friesen, for the appellant

Noah Schachter, for the respondent

Keywords: Criminal Law, Driving Under the Influence, Unreasonable Search or Seizure, Charter of Rights and Freedoms, s. 8, Appeal Allowed

 R v. Macintyre-Syrette, 2018 ONCA 259

[Juriansz, Watt and Miller JJ.A.]

Kristin Bailey and John Fennell, for the appellant

Kevin Rawluk, for the respondent

Keywords: Criminal Law, Sexual Assault, Sentencing, Appeal Dismissed

R v. Dhillon, 2018 ONCA 281

[Sharpe, Pardu and Fairburn JJ.A.]

Alan Gold and Alex Palamarek, for the appellant

Milica Potrebic, for the respondent

Keywords: Criminal Law, Trafficking, Sentencing, Appeal Dismissed

R v. Cuff, 2018 ONCA 276

[Rouleau, Huscroft and Fairburn JJ.A.]

Marianne Salih, for the appellant

Lisa Csele and Sharon Reynolds, for the respondent

Keywords: Criminal Law, Possession of Cocaine, Trafficking, Failure to Comply with Probation Order, Search and Seizure, Appeal Dismissed

R v. Long, 2018 ONCA 282

[Strathy C.J.O., Doherty, Hourigan, Roberts JJ.A. and McCombs J. (ad hoc)]

Mark C. Halfyard and Breana Vandebeek, for the appellant

Christine Bartlett-Hughes, for the respondent

Matthew R. Gourlay and Ben Rogers, for the intervener, The Criminal Lawyers’ Association (Ontario)

Keywords: Criminal Law, Sexual Assault, Criminal Code, R.S.C. 1985, c. C-46, Section 490.013(2.1), Canadian Charter of Rights and Freedoms, Section 7, Sex Offender Information Registration Act, S.C. 2004, c. 10

R v. Hewitt, 2018 ONCA 293

[Brown J.A. (Motion Judge)]

Robert J. Reynolds, for the moving party, appearing via videoconference

Avene Derwa, for the responding party

Keywords: Criminal Law, Trafficking, Sentencing, Interim Release, Criminal Code, s. 99(1)(a), Canadian Charter of Rights and Freedoms, s. 12, Application Dismissed

R v. Potts, 2018 ONCA 294

[Watt, Brown and Roberts JJ.A.]

Paul Calarco, for the appellant, Jeffrey Potts

Colin Wood, for the appellant, Tracy Robinson

Meaghan Hourigan, for the respondent

Keywords: Criminal Law, Trafficking, Wilful Blindness, Expert Evidence, Character Evidence, Appeal Dismissed

R v. Porto, 2018 ONCA 291

[Sharpe, Pardu and Fairburn JJ.A.]

David Butt and Maija Martin, for the appellant

Frank Au, for the respondent

Keywords: Criminal Law, Dangerous Driving Causing Bodily Harm, Highway Traffic Act  R.S.O. 1990, c. H.8, s. 128(13), Appeal Dismissed

 

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 (MARCH 12 – MARCH 16)

Good evening.

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

In Mars Canada Inc. v. Bemco Cash & Carry Inc., the Court upheld a settlement in which the parties had agreed to refrain from grey marketing Mars bars, finding that the settlement was not an improper restraint on trade.

O’Brien-Glabb v. National Bank of Canada is another example of the impact of “appropriate means” on the discoverability analysis under subsection 5(1) of the Limitations Act, 2002. In this case, the Court upheld the lower court’s order dismissing a summary judgment motion that sought to dismiss the plaintiff’s claim as being statute-barred. The Court found that it was not appropriate for the plaintiff to sue when she first began experiencing allergic symptoms that she suspected were caused by toxic mould in her workplace environment. Rather, it did not become appropriate to commence a claim until a specialist had provided an opinion, three years later, that the symptoms she was experiencing had been caused by toxic mould.

In Stanbarr Services Limited v. Metropolis Properties Inc., a sale of land by way of power of sale was attacked on the basis that the selling first mortgagee did not comply with the notice of sale provisions under the Mortgages Act, by failing to properly serve the notice of sale on all subsequent encumbrancers. The Court concluded that absent proof of actual notice on the part of the purchaser of non-compliance with the Mortgages Act, a purchase by way of power of sale could not be successfully attacked. In coming to that conclusion, the Court held that notice to the purchaser that a subsequent mortgagee had not received a notice of sale was not sufficient to support a finding that the purchaser had actual notice of non-compliance with the Mortgages Act. This was because a mortgagee could comply with the notice provisions of the Mortgages Act without the notice of sale actually coming to the attention of a subsequent encumbrancer. Accordingly, the purchaser in this case did not have actual notice of non-compliance with the Mortgages Act, and was therefore a bona fide purchaser for value without notice of any defect. The appeal from the Superior Court’s order setting aside the sale as defective was therefore allowed.

In an notable insolvency law decision, Third Eye Capital Corporation v. Ressources Dianor Inc./ Dianor Resources Inc., the Court determined that the Superior Court had erred in finding that royalty rights attached to mining rights were not interests in land. In finding that the royalty rights created no interest in land, the Superior Court had granted a vesting order whereby a receiver sold the mining rights to a third party purchaser, free and clear of the royalty rights. The vesting order was not stayed pending appeal and was executed. The Court declined to determine that the appeal was moot because the vesting order had been executed. It held that there was still a possibility that the appeal was not moot. The Court invited further submissions on the issues of whether the Superior Court had jurisdiction to grant the vesting order free and clear of the royalty rights, and also whether or not the appeal was moot. Stay tuned…

In Abrahamovitz v. Berens, the plaintiffs were seeking payment of certain rents that were being withheld from them by the defendant property managers. The defendants refused to pay the rents over because the prior property manager, who had died, had been purportedly promised a portion of those rents by the plaintiffs, evidenced by written acknowledgments. The plaintiffs sued the defendants to recover the rents. The defendants did not claim the rents for themselves. They acknowledged that the rents belonged either to the plaintiffs, or to the estate of the deceased property manager. The defendants moved to interplead the rents into court, and to add the estate of the deceased property manager who had the claim to the rents.

The Superior Court refused to add the estate on the basis that its claim to the rents was statute-barred. In a somewhat curious decision, the Court of Appeal set aside that order and added the estate as a party. The Court found that the limitation period defence against the estate belonged to the defendants, not the plaintiffs. Since the defendants had invited the estate to bring its claim, had moved to add the estate to the action, and had not raised a limitation period defence, the plaintiffs were found to have no right to rely on the defendants’ limitation period defence to deny the adding of the estate as a party.

I have some difficulty with this outcome, as it appears to favour form over substance and may have negative substantive consequences for the plaintiffs. If the defendants have no claim to the rents, then the true contest regarding the entitlement to the rents is between the plaintiffs and the estate, even though they had not sued each other. Presumably, now that the estate has been added as a party, the defendants will be permitted to interplead the funds into court and will be released from the action. In addition, the plaintiffs and the estate will presumably have an opportunity to exchange pleadings. The plaintiffs should be able to assert the limitation period defence to the estate’s claim to the rents. If successful, the parties may well end up where the lower court got them, however, only after spending significantly more resources to get there. If the plaintiffs are now unable to assert a limitation period defence, then they will be faced with a troubling situation in which one of their substantive defences was taken away by a party with no interest in the outcome (the defendants).

Finally, in the odd case of Ferreira v. St. Mary’s General Hospital, substantial indemnity costs were ordered against a lawyer who had unilaterally commenced legal proceedings, without instructions, in order to oppose the decision of her client’s wife and next of kin to withdraw life support from her client. The lawyer was found to have had no authority to take such a step (since her client was incapacitated at the time). The Court determined that the lawyer had acted dishonourably and had seriously interfered with the administration of justice by taking such an unauthorized step.

I hope everyone has an enjoyable weekend.

John Polyzogopoulos

Blaney McMurtry LLP

jpolyzogopoulos@blaney.com

Tel: 416 593 2953

Table of Contents

Mars Canada Inc. v. Bemco Cash & Carry Inc., 2018 ONCA 239

Keywords: Contracts, Enforceability, Restraint of Trade, Tank Lining Corp. v. Dunlop Industrial Ltd., (1982), 40 O.R. (2d) 219 (C.A.), Trademarks, Grey Marketing, Civil Procedure, , Hearings, Bifurcation, Bondy-Raphael v. Potrebic, 2015 ONSC 3655 (Div. Ct.), Summary Judgment, Hryniak v. Mauldin, Costs, Substantial Indemnity, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 131, Rules of Civil Procedure, rr. 6.1.01.1., 20.04(3), 57.01

O’Brien-Glabb v. National Bank of Canada, 2018 ONCA 242

Keywords:  Torts, Negligence, Employment Law, Workplace Safety, Civil Procedure, Summary Judgment, Limitation Periods, Discoverability, “Appropriate Means”, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, ss. 5(1)(a)(iv)

Stanbarr Services Limited v. Metropolis Properties Inc., 2018 ONCA 244

Keywords: Real Property, Mortgages, Power of Sale, Notice of Sale, Subsequent Encumbrancers, Bona Fide Purchasers for Value Without Notice of Defect, Actual Notice of Defect, Fraud, Mirror Principle, Mortgages Act, R.S.O. 1990, c. M.40, s. 33, s. 35, s. 35, Land Titles Act, R.S.O. 1990, c. L.5., s. 99(1), s. 99(1.1), Household Realty Corp. Ltd. v. Liu (2005), 205 O.A.C. 141 (C.A.)

Ferreira v. St. Mary’s General Hospital, 2018 ONCA 247

Keywords: Wills and Estates, Substitute Decisions, Incapacitation, Termination of Life Support, Health Care Consent Act, 1996S.O. 1996, Solicitor and Client, Authority to Act, Duty to Act Honourably, Rules of Professional Conduct, Civil Procedure, Standing, Mootness, Transmission of Interest, Orders to Continue, Rules of Civil Procedure, Rule 11.01, Costs, Substantial Indemnity

Third Eye Capital Corporation v. Ressources Dianor Inc./ Dianor Resources Inc., 2018 ONCA 253

Keywords: Bankruptcy & Insolvency, Receiverships, Property Law, Interests in Land, Mining Rights, Royalty Rights, Bank of Montreal v. Dynex Petroleum Ltd., 2002 SCC 7, Civil Procedure, Jurisdiction, Vesting Orders, Appeals, Mootness, Regal Constellation Hotel Ltd., Re (2004), 71 O.R. (3d) 355 (C.A.)Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, s. 243, Courts of Justice Act, R.S.O. 1990 c. C.43, s. 101, Mining Act, R.S.O. 1990, c. M.14., Repair and Storage Liens Act, R.S.O. 1990, c. R.25.

Abrahamovitz v. Berens, 2018 ONCA 252

Keywords: Contracts, Estates, Civil Procedure, Adding Parties, Defences, Limitation Periods, Standing, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, s. 21(1)

Criminal Decisions

Short Civil Decision and Ontario Review Board Decision

Civil Decisions:

Mars Canada Inc. v. Bemco Cash & Carry Inc., 2018 ONCA 239

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

Counsel:

  1. T. Summers, for the appellants
    J. and E. Udokang, for the respondent

Keywords: Contracts, Enforceability, Restraint of Trade, Tank Lining Corp. v. Dunlop Industrial Ltd., (1982), 40 O.R. (2d) 219 (C.A.), Trademarks, Grey Marketing, Civil Procedure, , Hearings, Bifurcation, Bondy-Raphael v. Potrebic, 2015 ONSC 3655 (Div. Ct.), Summary Judgment, Hryniak v. Mauldin, Costs, Substantial Indemnity, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 131, Rules of Civil Procedure, rr. 6.1.01.1., 20.04(3), 57.01

Facts:

The respondent Mars Canada Inc., an Ontario company, is related to the well-known American candy company. The appellant Aizic Ebert (“Ebert”) owns and controls the corporate appellants, Bemco Cash & Carry Inc. (“Bemco”) and GPAE Trading Corp. (“GPAE”). Through those companies, he sold “grey market” Mars products in Canada. He bought the products in the United States, imported them to Canada, and sold them at a price lower than those offered by the respondent. The law is unsettled as to whether a Canadian trademark holder can prevent this activity.

In about 2006, the respondent discovered that Bemco was selling Mars products in Toronto. It brought an action in the Federal Court. After lengthy negotiations and legal advice, the parties settled the action (the “Bemco Settlement”). Under the Bemco Settlement, Bemco agreed to identify the source of its grey market products. It also agreed that it would not import or sell Mars products in Canada without the respondent’s consent or without obtaining a declaratory judgment in the Superior Court authorizing it to do so. After the settlement, Bemco disclosed that GPAE was its supplier of foreign Mars products.

On disclosure of this information, the respondent demanded that GPAE cease its activities. GPAE agreed to do so. It agreed not to import or sell Mars products in Canada without the respondent’s consent (the “GPAE Settlement”). The GPAE Settlement was to be binding on related companies and their shareholders – that is, Bemco and Ebert.

In 2010, the respondent discovered that foreign products bearing its trademarks were once again being sold in Canada, through another company, in concert with Bemco and GPAE. It brought this action to enforce the Bemco Settlement and the GPAE Settlement and for damages. The appellants defended on the ground, among others, that the settlement agreements were in restraint of trade and, therefore, void.

The respondent brought a motion for summary judgment. It sought declaratory relief and damages. It also sought rectification of the Bemco Settlement, to correct an error in Bemco’s corporate name.

The Bemco Settlement was made in the name of Bemco Confectionary Sales, the company from which Ebert had purchased the business, rather than in Bemco’s proper name. The motion judge found that both parties intended the agreement to be the name of Bemco and granted rectification. That order is not appealed.

The motion judge also found that both Bemco and GPAE had breached their settlement agreements. Bemco by continuing to engage in grey marketing, and GPAE by continuing to import Mars products into Canada. The motion judge rejected the appellants’ argument that the settlement agreements were void as being in restraint of trade.

Having found that the appellants breached the agreements, he directed a reference as to damages pursuant to r. 20.04(3) of the Rules of Civil Procedure. He rejected the appellants’ submission that this was an improper bifurcation of the proceedings without their consent, contrary to r. 6.1.01.1.

In a subsequent endorsement, the motion judge granted costs to the respondent on a substantial indemnity basis, in the amount of $225,000, all inclusive. He found that the appellants “brazenly breached” their settlement agreements, contrived to avoid the settlements they made, raised trivial grounds of argument and made the litigation lengthier and more expensive than it ought to have been.

Issues:

(1) Did the motion judge err in giving effect to the settlement agreements?

(2) Did the motion judge err in directing a reference to determine damages?

(3) Did the motion judge err in principle in awarding substantial indemnity costs as a result of the appellants’ conduct prior to the commencement of the litigation?

Holding: Appeal dismissed.

Reasoning:

(1) No. In Tank Lining Corp. v. Dunlop Industrial Ltd, Blair J.A. stated that the test of restraint of trade requires a four-stage inquiry:

(a) whether the covenant is in restraint of trade;

(b) If so, whether it falls within one of the limited exceptions to the rule that such restraints are void;

(c) whether the restraint can be justified as reasonable in the interests of the parties;

(d) whether it is reasonable with reference to the interests of the public.

The onus is on the party seeking to enforce the covenant to show that it is reasonable in the interests of the parties. The onus is on the party opposing enforcement to show that the covenant is not reasonable in the public interest.

In the circumstances of this case, the respondent has legitimate interests tied to its trademark rights. The appellants have identified no error in the motion judge’s application of Tank Lining. The settlement of the litigation was unquestionably reasonable in the interests of the parties. It resolved their dispute and defined the scope of the parties’ trading rights. It was also reasonable in the public interest. It prevented confusion between the respondent’s trademarked products and the appellants’ improperly labelled grey market products.

(2) No. There was evidence before the motion judge to support a conclusion that the respondent sustained some damages. There was evidence given by the respondent’s witness that every sale of a grey market Mars bar by the appellants represented a loss of a sale by the respondent. As well, the appellants’ own expert testified that the appellants’ sales would “cannibalize” the respondent’s sales.

In any event, the respondent’s action was in breach of contract. The motion judge found that the appellants were in breach of their agreements. He granted a declaration to that effect. Unlike in tort, damages are not an essential element of a cause of action for breach of contract. The plaintiff need only establish the existence of a contract with the defendant and its breach. Having established a valid contract and a breach, the respondent was entitled to damages, even nominal damages. Nominal damages are always available in a breach of contract action.

The appellants also argue, as they did below, that the motion judge had no jurisdiction to bifurcate liability and damages, relying on Bondy-Raphael v. Potrebic and r. 6.1.01, which together provide that consent is required before a court can order separate hearings on issues of liability and damages. The Court of Appeal rejected the appellants’ submission that r. 6.1.01 applies to summary judgment motions. It is inconsistent with r. 20.04(3) and the underlying philosophy of the summary judgment process, described in Hryniak v. Mauldin. Its application would gut the efficacy of summary judgment.

(3) No. The motion judge identified the principles to be applied in fixing costs under s. 131 of the Courts of Justice Act, and considered the factors set out in r. 57.01. He also considered the appellants’ argument that the costs award should have reflected the fact that the respondent advanced several causes of action, some of which it ultimately withdrew.

The motion judge found that the appellants brazenly breached the settlements. They relied on an obvious slip (the misnomer of Bemco) to try to avoid living up to their agreements. Their efforts to undermine the agreements were dishonourable and deserving of censure. They altered a document in a transparent attempt to hide their illicit activities. The appellants have not demonstrated an error in principle in the motion judge’s award of costs. Accordingly, leave to appeal the costs order was not granted.

O’Brien-Glabb v. National Bank of Canada, 2018 ONCA 242

[Feldman, Pardu and Benotto JJ.A.]

Counsel:

  1. Webster, for the appellant
  2. Dallal, for the respondents

Keywords:  Torts, Negligence, Employment Law, Workplace Safety, Civil Procedure, Summary Judgment, Limitation Periods, Discoverability, “Appropriate Means”, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, ss. 5(1)(a)(iv)

Facts:

Natasha O’Brien-Glabb (the respondent) worked for the National Bank of Canada (the Bank). In April 2010, she began experiencing severe allergic symptoms while at work, which she suspected might be from mould or dust at her workplace. Her doctor advised that the symptoms could be due to a condition in her workplace and could be caused by mould. The Bank ultimately confirmed the presence of mould and undertook remedial work. She stopped working at the Bank in 2011. Despite seeing a number of doctors, the respondent was not diagnosed with anything that connected her condition to mould exposure at the Bank. She continued to believe, however, that the two were connected.

In February 2013, the respondent sought out a specialist, Dr. Patel, who concluded that she had a genetic deficiency that impedes her body’s ability to detoxify many toxins, and informed her that her symptoms were caused by exposure to mycotoxins released from toxic mould in the Bank building. The respondent commenced an action against the Bank in July 2013. The Bank brought a motion for summary judgment alleging that the claim was statute-barred because the limitation period began to run in April or June 2010, when the respondent began to experience allergic symptoms. The motion judge dismissed the motion for summary judgment on the basis that the limitation period did not commence until February 2013, when the respondent received the diagnosis from Dr. Patel.

Issues:

(1) Did the motion judge misapprehend the facts, and err in finding the limitation period had not elapsed?

(2) Did the motion judge err in applying the meaning of “appropriate means” set out in s. 5(1)(a)(iv) of the Limitations Act?

Holding: Appeal dismissed.

Reasoning:

(1) No. The respondent was not aware that the mould was the cause of her illness prior to seeing the specialist. There is evidence that she was being investigated for a variety of illnesses other than an allergy to mould. The appellant further alleged that the motion judge erred in finding the limitation period began to run in February 2013 on the basis that the respondent “suffered two separate and distinct injuries arising from the mould in the bank”. It was open to the motion judge on the evidence to make this finding. Until the respondent saw Dr. Patel, she did not know that she had a genetic disorder. According to Dr. Patel, this disorder exacerbated the effects of her exposure to the toxic mould, which included “oxidative stress and damage to various cell membrane of organs and organelle”. He also gives the opinion that these exacerbated effects “cause adverse health effects similar to exposures to hazardous substance[s] that adversely affect various systems in the body”, akin to exposure to toxic chemicals or toxic metals. There was therefore evidence on which the motion judge could conclude that organ damage is a separate and distinct injury from allergic symptoms and that the respondent did not know of that injury until February 2013.

(2) No. The appellant submits that the motion judge erred in concluding that it was not “appropriate” for the respondent to start her action in 2010. It alleges that the motion judge reversed the onus of proof by requiring the appellant to establish that an action would have been appropriate when the allergic symptoms first appeared in 2010 and also that she applied a subjective rather than objective standard to the determination of when a proceeding would be an appropriate means to seek to remedy the injury, loss or damage.

It was the respondent who bore the onus of leading evidence to establish on a balance of probabilities that a proceeding was not appropriate in 2010. However, the motion judge’s reasons, read as a whole, make it clear that she was satisfied the respondent had met this burden. In essence, the motion judge concluded that a reasonable person in the circumstances of the respondent would not have known that a legal proceeding would have been an appropriate remedy for possible exposure to allergens before 2013.

Stanbarr Services Limited v. Metropolis Properties Inc., 2018 ONCA 244

[Doherty, Pepall and Hourigan JJ.A.]

Counsel:

  1. G. Slaght and D. Glatt, for the appellant/respondent, 2413913 Ontario Limited B Belmont, for the appellants, 2421955 Ontario Inc. and Sai Mohammed
    S. Schwartz, for the respondents/appellants, Stanbarr Services Limited et al
    P. Polster, for the respondent, Ginkgo Mortgage Investment Corporation

Keywords: Real Property, Mortgages, Power of Sale, Notice of Sale, Subsequent Encumbrancers, Bona Fide Purchasers for Value Without Notice of Defect, Actual Notice of Defect, Fraud, Mirror Principle, Mortgages Act, R.S.O. 1990, c. M.40, s. 33, s. 35, s. 35, Land Titles Act, R.S.O. 1990, c. L.5., s. 99(1), s. 99(1.1), Household Realty Corp. Ltd. v. Liu (2005), 205 O.A.C. 141 (C.A.)

Facts:

This case addresses numerous appeals represented by a series of three different dockets (Dockets C61872, C61878 and C61894).

Canada Investment Corporation (“CIC”) was the first mortgagee on property owned by Metropolis Properties Inc. (“Metropolis”) municipally described as 91-93 Scollard Street, Toronto, Ontario (the “Property”). The mortgage was in default and CIC sought to sell the Property under its power of sale rights in its mortgage. At the time, there were eleven subsequent mortgages registered against the Property. The appellant 2413913 Ontario Inc. (“241 Ontario”) purchased the Property pursuant to CIC’s power of sale. The appellant Sai Mohammed is a director of 241 Ontario. The sale closed on June 6, 2014. The pre-sale mortgagees argued that they had never received a notice of sale, as required by the Mortgages Act, R.S.O. 1990, c. M.40, and that the sale was therefore invalid. The trial judge accepted that 241 Ontario was a bona fide purchaser for value of the Property. The issue was whether 241 Ontario was without notice that the sale was defective.

As part of the impugned sale, Ginkgo Mortgage Investment Corporation (“Ginkgo”) provided financing to 241 Ontario and took a first mortgage on the Property. Mr. Mohammed was also involved as a mortgagee, personally or in his role as director of 2421955 Ontario Inc. (“242 Ontario”), in several subsequent post-sale mortgages. Mr. Mohammed and 242 Ontario (the “post-sale subsequent mortgagees”) also appeal.

Issues:

(1) Did the trial judge err in applying the wrong test for actual notice sufficient to defeat a registered interest under the Land Titles Act, R.S.O. 1990, c. L.5?

(2) If the answer to issue 1 is yes, can 241 Ontario rely on its registration of the transfer?

(3) Did the trial judge err in her analysis of the validity of the mortgages registered by the post-sale subsequent mortgagees?

(4) Did the trial judge err in her analysis of the validity of the mortgage registered by Ginkgo?

Holding:

Appeal of 241 Ontario in appeal C61872 allowed.

Appeal of the post-sale subsequent mortgagees in appeal C61894 allowed.

Appeal of the pre-sale mortgagees in appeal C61878 dismissed.

Reasoning:

(1) Yes. Our courts insist on actual notice of a defect. Actual knowledge means just that; the party must actually know about the defect. It is not sufficient that it has become aware of facts that may suggest it should make inquiries: Rose v. Peterkin (1885), 13 S.C.R. 677, at pp. 694-695. Constructive knowledge is insufficient. Thus, the factual analysis in considering a notice argument is limited to a consideration of what the party knew, not what it could have known had it made inquiries. The issue that the trial judge had to determine was whether 241 Ontario had actual knowledge of non-compliance with s. 33 of the Mortgages Act, which mandates the manner of notice of the exercise of a power of sale. The trial judge erred in two respects in her knowledge analysis.

First, she conflated actual knowledge with constructive knowledge. In determining whether a party has actual knowledge of a defect, it is unnecessary and unhelpful to consider whether they received sufficient information to put them on inquiry. That is because receipt of such information does not amount to actual knowledge: Rose, at pp. 694-695. Therefore, whether the party received such information and what steps it took to investigate the situation is wholly irrelevant to the actual knowledge analysis.

The second error in the trial judge’s knowledge analysis was her failure to properly identify the alleged defect in the power of sale process. She found that 241 Ontario had actual notice, noting that “[i]ts counsel received an email [from Mr. Bourassa] that stated flatly that no notice of sale had been received from CIC and any attempt by CIC to sell would be invalid” (para. 112). Section 33 of the Mortgages Act provides for service of a notice of sale by personal service or by registered mail to the party’s usual or last known address, or, where the last known address is shown on the registered instrument under which the party acquired an interest, to that address. Pursuant to s. 34, a notice delivered by mail is deemed to have been given on the day on which it is mailed. It is not a defect in a power of sale process that a notice is not received by the intended recipient; it is only a defect if the notice was not sent in the prescribed manner: Wood v. Bank of Nova Scotia (1980), 29 O.R. (2d) 35 (C.A.), at pp. 36-37. The trial judge erred in finding that 241 Ontario had actual notice of the defect because of Mr. Bourassa’s email, which said that no notice had been received. 241 Ontario had no actual knowledge of a defect, i.e. that the notice was not sent in the prescribed manner. In the court’s view, therefore, the trial judge erred in finding that 241 Ontario had actual knowledge of a defect.

(2) Yes. Sections 35 and 36 of the Mortgages Act do not purport to limit 241 Ontario’s right to rely on the registration of evidence referred to in ss. 99(1) and 99(1.1) of the Land Titles Act. These provisions provide complementary methods of protecting bona fide purchasers for value without notice of a defect in a power of sale proceeding. This interpretation is also consistent with the curtain principle underlying the Land Titles Act, which holds that a purchaser need not investigate the history of past dealings with the land or search behind the title as depicted on the register. The Court of Appeal therefore concluded that 241 Ontario was a bona fide purchaser for value without notice of the defect in the power of sale proceedings and holds good title to the Property.

(3) Yes. With respect to the post-sale subsequent mortgagees, the trial judge found that they were all deemed to have the same knowledge that Mr. Mohammed obtained by reason of his position as a director of 241 Ontario and his involvement with the post-sale subsequent mortgagees. Accordingly, the trial judge’s knowledge analysis was flawed for the same reasons. Therefore, her finding with respect to the validity of these mortgages was set aside. The post-sale subsequent mortgagees were found to have valid encumbrances.

(4) Yes. A proper fraud analysis required the trial judge to consider the amendments to the Land Titles Act enacted after the court’s decision in Household Realty Corp. Ltd. v. Liu (2005), 205 O.A.C. 141 (C.A.). Those amendments introduced the provisions pursuant to which a court is to analyze whether there has been fraud such that the mirror principle is defeated. Given that the trial judge proceeded on the basis that fraud had not been proved, she should have restricted her analysis to whether Ginkgo had actual notice of a non-fraudulent defect. If this were a case where she was considering a fraud argument, a proper analysis had to take into account the post-Household Realty amendments to the Land Titles Act and focus on whether the Ginkgo mortgage was a fraudulent instrument that fell within the exception found in s. 78(4.1).

Ferreira v. St. Mary’s General Hospital, 2018 ONCA 247

[Juriansz, Miller and Nordheimer JJ.A.]

Counsel:

  1. Palmer, for Georgiana Masgras, also acting in person
    D. Jarvis, for the respondent, St. Mary’s General Hospital
    S. Batner, for the respondent, Dr. Christopher Hinkewich

Keywords: Wills and Estates, Substitute Decisions, Incapacitation, Termination of Life Support, Health Care Consent Act, 1996S.O. 1996, Solicitor and Client, Authority to Act, Duty to Act Honourably, Rules of Professional Conduct, Civil Procedure, Standing, Mootness, Transmission of Interest, Orders to Continue, Rules of Civil Procedure, Rule 11.01, Costs, Substantial Indemnity

Facts:

Ms. Masgras, a lawyer, purported to bring this appeal on behalf of Mr. Ferreira. The case revolves around a lawyer’s claim of authority to take steps on behalf of a client who is incapacitated.

In December 2016, Mr. Ferreira was in a motor vehicle accident. He retained Ms. Masgras in respect of his claims for compensation for neck and lower back pain and related injuries.

On July 3, 2017, Mr. Ferreira was found in cardiac arrest at his home. He was provided with life support in the Intensive Care Unit, however his condition continued to deteriorate and there was no prospect of recovery.

On July 6, 2017, Mr. Ferreira’s family decided to remove Mr. Ferreira from life support. During this time, Ms. Masgras became aware of Mr. Ferreira’s condition and urged Mr. Ferreira’s family to reconsider removing Mr. Ferreira from life support.

When the family declined, Ms. Masgras, on her own initiative, challenged the family’s decision and obtained a stop order.

Mr. Ferreira’s condition continued to deteriorate and the stop order was set aside, with costs ordered against Ms. Masgras. Mr. Ferreira was removed from life support and he passed away.

On August 18, 2017, Ms. Masgras appealed and sought to have the order of the reviewing judge set aside. The respondents sought their costs of the application on a substantial indemnity basis against Ms. Masgras personally. The application judge ordered costs against Ms. Masgras, although not on a substantial indemnity basis.

Issues:

(1) Did the reporting judge err in setting aside an interim injunction that prohibited the removal of Mr. Ferreira from life support?

(2) Did the application judge err in ordering costs against Ms. Masgras personally?

Holding: Appeal dismissed.

Reasoning:

(1) No. The court held that the main appeal cannot succeed for two reasons. First, Ms. Masgras had no instructions to bring the appeal. Further, the underlying application was stayed as a result of Mr. Ferreira’s death by virtue of r. 11.01 of the Rules of Civil Procedure, unless and until an order to continue is granted under r. 11.02. No such order had ever been obtained.  Once death occurred, the right to bring the appeal vested in the estate trustee. Consequently, the appeal was improperly constituted as it had not been brought by the estate trustee nor had it been assigned by the estate trustee to Ms. Masgras.

Second, and in any event, the appeal was now moot. Therefore, the court dismissed the main appeal.

(2) No. The Court held that Ms. Masgras had no authority to take the steps that she did. Indeed, the court stated that it was not apparent on the record that Ms. Masgras sought or obtained any form of instructions from any next of kin of Mr. Ferreira, most notably, his wife. Under the Health Care Consent Act, 1996S.O. 1996, c. 2, Sched. A, s. 20, if a person is incapable with respect to treatment, consent may be given by a person designated in the section, one of which is the incapable person’s spouse. In short, the court held that Ms. Masgras breached the basic principles that apply to the conduct of lawyers, particularly their duty to act honourably.

The court fixed costs to be payable by Ms. Masgras on a substantial indemnity basis to the Hospital at $19,885.74 and to Dr. Hinkewich at $11,642.00.

Third Eye Capital Corporation v. Ressources Dianor Inc./ Dianor Resources Inc., 2018 ONCA 253

[Pepall, Lauwers and Huscroft JJ.A.]

Counsel:

  1. J. Matson and R. W. Johansen, for the appellant, 2350614 Ontario Inc.
    S.N. Roy, for the respondent Third Eye Capital Corporation
    D. Chochla, for the receiver of Dianor Resources Inc., Richter Advisory Group Inc.
    D. Contractor, for the monitor of Essar Steel Algoma Inc., Ernst & Young Inc.

Keywords: Bankruptcy & Insolvency, Receiverships, Property Law, Interests in Land, Mining Rights, Royalty Rights, Bank of Montreal v. Dynex Petroleum Ltd., 2002 SCC 7, Civil Procedure, Jurisdiction, Vesting Orders, Appeals, Mootness, Regal Constellation Hotel Ltd., Re (2004), 71 O.R. (3d) 355 (C.A.)Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, s. 243, Courts of Justice Act, R.S.O. 1990 c. C.43, s. 101, Mining Act, R.S.O. 1990, c. M.14., Repair and Storage Liens Act, R.S.O. 1990, c. R.25.

Facts:

Dianor Resources Inc. (“Dianor”) was insolvent. At the request of its lender, the respondent, Third Eye Capital Corporation (“Third Capital”), the court appointed a receiver under s. 243 of the Bankruptcy and Insolvency Act (“BIA”), and s. 101 of the Courts of Justice Act (“CJA”), over the assets, undertaking and property of the debtor, Dianor.

Dianor’s main asset was a group of mining claims. The claims with which this appeal is concerned were subject to, among other things, a “Gross Overriding Royalty” (“GOR”) in favour of a company from which the appellant, 2350614 Ontario Inc. (“235Co”), had acquired the royalty rights. Notices of the agreements granting the GORs were registered on title to the surface rights and the mining rights.

The supervising judge made an order approving a bid process for the sale of Dianor’s mining claims. It generated two bids, both containing a condition that the GORs be terminated or significantly reduced. Third Eye was the successful bidder.

At the request of the receiver, the motion judge approved the sale of the mining claims to Third Eye and granted a vesting order that purported to extinguish the GORs. 235Co did not oppose the sale but asked that the property vested in Third Eye be subject to the GORs.

The motion judge rejected the appellant’s argument that the claims would continue to be subject to the GORs after their transfer to Third Eye. He held that the GORs do not run with the land or grant the holder of the GORs an interest in the lands over which Dianor holds the mineral rights.

The motion judge also held that  ss. 11(2), 100, and 101 of the CJA, gave him “the jurisdiction to grant a vesting order of the assets to be sold to Third Eye on such terms as are just”, including the authority to dispense with the royalty rights. He found the expert’s valuation of the royalty rights to be fair. The receiver paid this amount to 235Co. The funds are being held in trust pending the outcome of this appeal. 235Co also brought a cross-motion claiming payment for a debt owing under the Repair and Storage Liens Act. The motion judge dismissed the cross-motion.

Issues:

(1) Does registration of the vesting order on title render the appeal moot?

(2) Do the GORs constitute interests in land?

(3) If so, did the motion judge have jurisdiction to vest out the GORs?

Holding: The next phase of the appeal, assuming the parties choose to pursue it, requires case management to coordinate written submissions on the issues raised in the reasons and to consider the necessity of oral submissions.

Reasoning:

(1) To be determined. The appellant did not seek a stay of the vesting order pending appeal before the vesting order was registered on title, although it could have done so on a timely basis. Generally, a vesting order cannot be attacked on appeal unless a stay order has been obtained. Third Eye submits that the appeal is moot because the vesting order was “spent” when it was registered (see Regal Constellation Hotel Ltd.).

It cannot be said that the appeal is moot in the particular circumstances of this case. The order is spent, but the remedy for rectification under the LTA may be available to the appellant, provided that several conditions are met:

(a) the motion judge had no jurisdiction to vest out the GORs;

(b) no innocent third party has relied on the title to its detriment; and

(c) the appellant is otherwise entitled to the remedy.

Additional submissions are required before determining whether the appeal is moot. In particular, because the Court of Appeal found that the GORs are interests in land, does the fact that Third Eye had notice of 235Co’s claim affect the application of Regal Constellation?

(2) Yes. Notices of the GORs were registered on title to the patented lands under s. 71 of the LTA and on the unpatented mining claims under the Mining Act. The parties did not treat the fact that 235Co came to hold the GORs as a live issue.

The ruling precedent is the decision of the Supreme Court of Canada in Bank of Montreal v. Dynex Petroleum Ltd, which changed the common law to permit a GOR to achieve status as an interest in land. In that case, Major J.A. adopted the view that Canadian common law should recognize that a “royalty interest” or an “overriding royalty interest” can be an interest in land if:

(a) the language used in describing the interest is sufficiently precise to show that the             parties intended the royalty to be a grant of an interest in land, rather than a contractual right to a portion of the oil and gas substances recovered from the land; and

(B) the interest, out of which the royalty is carved, is itself an interest in land.

In applying the Dynex test, the Court of Appeal found that the appellant’s GORs constituted interests in land that run with the land and are capable of binding the claims in the hands of a purchaser. The motion judge made three legal errors in his analysis. The first error was that he did not examine the parties’ intentions from the royalty agreements as a whole, along with the surrounding circumstances. The motion judge’s second error was in holding that in order to qualify as an interest in land, the royalty agreements had to give the appellant the right to enter the property to explore and extract diamonds or other minerals. The third error was in holding that “the interest, out of which the royalty is carved, is not [an] interest in land” because it is expressed in the Agreements as only a right “to share in revenues produced from diamonds or other minerals extracted from the lands.” The latter two errors came from a misapprehension of the Dynex test.

(3) To be determined. The context for this issue is set by the conclusions the court reached on the issue of mootness. Because the GORs are interests in land, the appeal is not necessarily moot, particularly if the Superior Court did not have jurisdiction to issue the vesting order in these circumstances.

The question must be addressed in additional argument before the panel, specifically on the following issue: Whether and under what circumstances and limitations (including the ones enumerated above) a Superior Court judge has jurisdiction to extinguish a third party’s interest in land using a vesting order, under s. 100 of the CJA and s. 243 of the BIA, where s. 65.13(7) of the BIA; s. 36(6) of the CCAA; ss. 66(1.1) and 84.1 of the BIA; or s. 11.3 of the CCAA do not apply?

Abrahamovitz v. Berens, 2018 ONCA 252

[Laskin, Feldman and Miller JJ.A]

Counsel:

  1. S. Marr and Z. Silverberg, for the appellant, the Estate of Gabriel Zimmerman
    D. P. Jacobs, for the respondents

Keywords: Contracts, Estates, Civil Procedure, Adding Parties, Defences, Limitation Periods, Standing, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, s. 21(1)

Facts:

The respondents, Faigie Abrahamovitz and Frances Spiro, are two of four shareholders of a holding company that owns a commercial property. They brought this action against the defendants, claiming their full share of the annual rental income from the property.

One of the defendants, Megapro Property Management Ltd., has been the manager of the property since late 2009, following the illness and death of the prior property manager, Gabriel Zimmerman. It has collected the rents, but is holding back part of the entitlement of the respondents because of a claim to part of their share of the funds by the Estate of Mr. Zimmerman. That claim is based on two separate Acknowledgements purportedly  signed by each of the respondents in 2002. The Acknowledgements gave Mr. Zimmerman a 25% interest in the respondents’ respective entitlements to the rental and sale proceeds of the property.

In 2011, the respondents sued Megapro and the other defendants for the funds Megapro has been holding back. In 2016, the defendants brought the motion under appeal for an order adding the Estate as a necessary party to the action. The defendants also sought an interpleader order allowing Megapro to pay the funds it is holding into court to await the outcome of the issue of the validity and effect of the Acknowledgements. The Estate participated in the motion, supporting the defendants’ argument that it should be added as a necessary party to the action.

The motion judge dismissed the defendants’ motion on the basis that the Estate’s claim was statute barred, as Mrs. Zimmerman, the Estate trustee, discovered the Acknowledgements in 2010 following her husband’s death. On this appeal, the appellant is the Estate. The defendants did not participate in the appeal.

Issues:

(1) Did the motion judge err in dismissing the motion to add the Estate as a party on the basis that the Estate’s claim was statute barred?

Holding: Appeal allowed.

Reasoning:

(1) Yes. Although the court would not give effect to the submission by the Estate that it was entitled to relief because the statement of defence already pleads its claim, the fact that the defendants have pleaded those facts in order to put the issue of the validity of the Acknowledgements before the court, and did not raise any limitation argument in doing so, meant thatit was an error for the motion judge to find that the Estate’s claim was statute-barred.

In this case, it was neither the pleading nor the position of the defendants, at any time in this litigation, that the Estate’s claim was statute-barred. To the contrary, the defendants were the ones who invited the Estate to assert its claim in 2016, and who initiated the motion to add the Estate as a party to the action when the respondents would not consent to add the Estate. While the defendants never raised any limitations defence, it was the respondents (the plaintiffs) who took the position on the motion that the Estate’s claim was statute-barred. The respondents had no standing to do so. By giving effect to their submission, the motion judge erred in law by treating the respondents as if they were defendants in an action by the Estate.

By approaching the issue on the motion as if it concerned a claim brought by the Estate against the respondents, the motion judge erred in allowing the respondents to assert a limitations defence against the Estate. As the claim of the Estate is against the defendants, the right to raise a limitations defence lies with them, not the respondents.

The Estate is a necessary party to the action to ensure that it will be bound by the court’s determination of the issue of the validity of the Acknowledgements. Otherwise, that issue could be re-litigated with the risk of inconsistent verdicts, if the Estate were to sue the defendants for payment in a separate action. Subsection 21(1) of the Limitations Act, 2002 does not bar the addition of the Estate because, where the defendants have not pleaded a limitations defence, the Estate’s claim against the defendants has not expired.

Criminal Decisions:

R v. Bygott, 2018 ONCA 243

[Rouleau, Huscroft and Fairburn JJ.A.]

Counsel:

A. Furgiuele and C. Barbisan, for the appellant
B. G. Puddington, for the respondent

Keywords: Criminal Law, Fraud, Adjournments

R v. McConnell, 2018 ONCA 241

[Pardu, Benotto and Nordheimer JJ.A.]

Counsel:

R. F. Goddard, for the appellant
L. Bolton, for the respondent

Keywords: Criminal Law, Sentencing, Global Sentence, Post-sentence Rehabilitative Efforts, Credit for terms

R v. B-D.N., 2018 ONCA 248

[Watt, Brown and Huscroft JJ.A.]

Counsel:

S. Friedman, for the appellant
N. Dennison, for the respondent

Keywords: Criminal Law, Sexual Assault, Evidence, Consent, Reasonable Apprehension of Bias

R v. Pun, 2018 ONCA 240

[Pardu, Benotto and Nordheimer JJ.A.]

Counsel:

M. Henein & C. Mainville, for the appellant
R. Young, for the respondent

Keywords: Criminal Law, Fraud, Sentencing, Onus of Proof, Credibility

R v. Tapp, 2018 ONCA 228

[Rouleau, Huscroft and Fairburn JJ.A.]

Counsel:

D. Anber, for the appellant
A. Hotke, for the respondent

Keywords: Criminal Law, Robbery

R v. A.S., 2018 ONCA 249

[Rouleau, Hourigan and Huscroft JJ.A.]

Counsel:

J. Sandler and A. Ross, for the appellant
J. Smith Joy, for the respondent

Keywords: Criminal Law, Sexual Interference, Sexual Exploitation, Sexual Assault, Jury Charge, R. v. W.(D.), [1991] 1 S.C.R. 742

R v. J.H., 2018 ONCA 245

[Simmons, van Rensburg and Nordheimer JJ.A.]

Counsel:

J. Presser and D. Stein, for the appellant
L. Joyal, for the respondent

Keywords: Criminal Law, Evidence, Character, Discreditable Conduct, Similar Fact Evidence, Burden of Proof, R v. Handy, 2002 SCC 56, Sentencing, Global Sentence, Principle of Totality

R v. Rosen., 2018 ONCA 246

[Juriansz, Watt and Miller JJ.A.]

Counsel:

M. Lacy, for the appellant
A. Alvaro, for the respondent

Keywords: Criminal Law, Murder, Evidence, Mens Rea, Ante-Mortem Statements, Jury Charge, Post Offence Conduct

R v. Plante, 2018 ONCA 251

[Pardu, Benotto and Nordheimer JJ.A.]

Counsel:

L. Daviau, duty counsel for the appellant
G. Choi, for the respondent

Keywords: Criminal Law, Sentencing, Enhanced Credit, R v. Summers, 2014 SCC 26, Statutory Release, Provincial System

R v. Colasimone, 2018 ONCA 256

[Laskin, Pepall JJ.A. and Gans J. (ad hoc)]

Counsel:

J. Harbic, for the appellant
M. Lai, for the respondent

Keywords: Criminal Law, Armed Robbery, Sentencing, R v. Orwin, 2017 ONCA 841, Deterrence, Public Safety

R v. Kassam, 2018 ONCA 266

[Feldman, Watt and Paciocco JJ.A.]

Counsel:

M. Hogan, for the appellant
A. Cappell, for the respondent

Keywords: Criminal Law, Fraud, Jordan Application, Rowbatham Application

R v. Tennant, 2018 ONCA 264

[Feldman, Watt and Paciocco JJ.A.]

Counsel:

C. Sewrattan, for the appellant
M. Gaspar, for the respondent

Keywords: Criminal Law, Evidence, R v. Sekhon, 2014 SCC 15, Canadian Charter of Rights and Freedoms, s. 24(2), Grant Factor

Short Civil Decisions and Costs Endorsements:

El-Khodr v. Lackie, 2018 ONCA 250

[Doherty, MacFarland and Rouleau JJ.A.]

Counsel:
J. Y. Obagi and E. A. Quigley, for the moving party
B. A. Percival, Q.C. and J. W. Gibson, for the responding parties

Keywords: Costs, Motion for Reconsideration, Cobb v. Long Estate, 2017 ONCA 717

Perri v. Perri, 2018 ONCA 237

[Pepall, Lauwers and Pardu JJ.A.]

Counsel:

B. Vandebeek, for the appellant
D. Friesen, for the respondent

Keywords: Family Law, Costs Endorsement, Partial Indemnity Costs

Luckevich v. Ivany, 2018 ONCA 254

[Doherty, Paciocco and Nordheimer JJ.A.]

Counsel:

M. Katzman, for the appellant
H. W. Reininger, for the respondents
T. Duncan, for Trustee in Bankuptcy

Keywords: Costs Endorsement, Bankruptcy and Insolvency, Property of Bankrupt, Choses in Action

Boudreau Commercial Contracting Inc. v. Caruana, 2018 ONCA 257

[Hoy A.C.J.O., Juriansz and Miller JJ.A.]

Counsel:

O. D. Thomas, for the appellant
C. J. Bondy and D. Ableser, for the respondent

Keywords: Corporations, Shareholder Loans, Bankruptcy and Insolvency, Civil Procedure, Partial Summary Judgment

Kerzner Estate, 2018 ONCA 258

[Hoy A.C.J.O., Juriansz and Miller JJ.A.]

Counsel:

B. Stajduhar and A. Stajduhar, acting in person
R. Coates, for the respondent

Keywords: Estates, Fresh Evidence, Succession Law Reform Act, R.S.O. 1990, c. S.26

Hampton Securities Limited v. Dean, 2018 ONCA 262

[Fairburn J.A. (Motions Judge)]

Counsel:

S. J. Erskine and D. Barbaree, for the moving party
C. J. Somerville and D. Hooper, for the responding party

Keywords: Costs Endorsement, Stay of Proceedings

Umlauf v. Halton Healthcare Services, 2018 ONCA 265

[Hoy A.C.J.O., Juriansz and Miller JJ.A.]

Counsel:

J. Umlauf, acting in person
N. Rathwell, for the respondents

Keywords: Torts, Crown Liability, Pleadings, Striking Claims, Proceedings Against the Crown Act, R.S.O. 1990, c. P.27, s.7(1), Local Health System Integration Act, 2006, S.O. 2006, c.4, s.35.1, Canadian Charter of Rights and Freedoms

ONTARIO COURT OF APPEAL SUMMARIES (MARCH 5 – MARCH 9)

Good evening,

Below are this week’s Court of Appeal summaries. Topics included security for costs, bankruptcy and insolvency, family law, real property & condo law, as well as several procedural decisions.

Douglas v. Stan Fergusson Fuels Ltd. is a rare example of the Court of Appeal convening a five-member panel in order to overrule itself. The case dealt with a subrogated insurer who sued the appellants for contamination of property resulting from a home oil spill. As is required under the law of subrogation, the insurer brought the claim in the name of its insured. However, at the time the claim was brought, the insured was an undischarged bankrupt who no longer had an ownership interest in the property. By virtue of the bankruptcy, title vested with the Trustee in Bankruptcy.

The appellants, who had been sued by the insurer for causing the spill, brought a motion to dismiss the claim on the basis that it was a nullity because the insured was bankrupt when it was commenced, and therefore the cause of action had vested in his Trustee in Bankruptcy, who was not the named plaintiff. The motion judge and the Divisional Court had both allowed the action to proceed, finding that the bankruptcy did not catch the insurer’s subrogated claim.

However, a five-panel member of the Court of Appeal determined that the action was not properly constituted, as the cause of action vested in the Trustee when it was commenced. The action therefore was caught by the bankruptcy. The Court extensively discusses the doctrine of subrogation, as well as bankruptcy law principles regarding the vesting of property in a Trustee upon bankruptcy and the inability of undischarged bankrupts to bring claims in their name.

In coming to its conclusion, the Court overruled its own decision in Mariner Foods Ltd. v. Leo-Progress Enterprises Inc., 2017 ONCA 7, leave to appeal dismissed [2017] S.C.C.A. No. 64. The Court noted that its decision in that case was a short, five-paragraph endorsement disposing of an application to admit fresh evidence on appeal. The Court in that case had cited the Divisional Court’s decision in this case for the principle that a subrogated claim brought by an insurer is not caught by a bankruptcy. Mariner was decided while the appeal in this case was pending, without reference to binding judicial authority or analysis. The five-judge panel was convened to permit the Court, if warranted, to over-rule Mariner to the extent that, in reliance on the Divisional Court’s decision in this case, it stands for the principle that a subrogated claim brought by an insurer is not caught by a bankruptcy. In the Court’s view, the broad principle enunciated in Mariner conflates the concepts of subrogation and assignment and is incorrect in law. Accordingly, the Court applied the per incuriam exception to stare decisis and overruled Mariner to the extent it stands for that principle.

The majority dismissed the claim outright, without giving the insurer the chance to regularize the pleading by substituting the name of the Trustee for the name of the insured. The minority would have allowed the insurer to bring a motion to the lower court to substitute the name of the Trustee for the name of the insured.

Wishing everyone an enjoyable March break.

John Polyzogopoulos

Blaney McMurtry LLP

jpolyzogopoulos@blaney.com

Tel: 416 593 2953

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

Table of Contents:

Novak v. St. Demetrius (Ukrainian Catholic) Development Corporation, 2018 ONCA 219

Keywords: Civil Procedure, Appeals, Security for Costs, Chevron Corp. v. Yaiguaje, 2017 ONCA 827

Hampton Securities Limited v. Dean, 2018 ONCA 216

Keywords: Civil Procedure, Appeals, Stay Pending Appeal, Rules of Civil Procedure, Rule 63.02(1), RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311

Susin v. Susin, 2018 ONCA 220

Keywords: Civil Procedure, Extension of Time, Security for Costs

Metropolitan Toronto Condominium Corporation No. 723 v. Reino, 2018 ONCA 223

Keywords:  Real Property, Condominiums, Status Certificates, Estoppel, Condominium Act, 1998, S.O. 1998, c. 19, s. 76

DBDC Spadina Ltd. v. Walton, 2018 ONCA 232

Keywords: Civil Procedure, Costs, Fraud, Rule 57.01, Rules of Civil Procedure, Boucher v. Public Accountants Council (Ontario) (2004), 71 O.R. (3d) 291 (C.A.)

Douglas v. Stan Fergusson Fuels Ltd., 2018 ONCA 192

Keywords:  Bankruptcy and Insolvency, Property of Bankrupt, Undischarged Bankrupts, Trustees, Vesting of Property, Choses in Action, Insurance Law, Subrogation, Mariner Foods Ltd. v. Leo-Progress Enterprises Inc., 2017 ONCA 7, Civil Procedure, Striking Pleadings, Capacity to Sue, Orders, Nunc Pro Tunc, Amending Pleadings, Adding Parties, Limitation Periods, Appeals, Stare Decisis, Powers on Appeal, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, ss. 38, ss. 40,  ss. 67, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 134

Holtby v. Draper, 2018 ONCA 231

Keywords: Family Law, Property, Co-ownership, Resulting Trust, Unjust Enrichment, Costs

For Criminal Decisions click here

For Short Civil Decisions click here

Civil Decisions:

Novak v. St. Demetrius (Ukrainian Catholic) Development Corporation, 2018 ONCA 219

[Juriansz, Miller and Nordheimer JJ.A.]

Counsel:

S Novak, acting in person

N Brankley, for the responding parties

Keywords: Civil Procedure, Appeals, Security for Costs, Chevron Corp. v. Yaiguaje, 2017 ONCA 827

Facts:

The appellant, Novak, brings this motion to review the decision of Epstein J.A. sitting as a single judge in motions court ordering her to post security of costs of the appeal in the amount of $20,000. The appellant confirms that she does not have the ability to pay any costs that may be awarded against her in the event that she loses the appeal. Further, she hints that she would refuse to pay costs in any event.

Issues:

(1) Did the motion judge err by ordering the appellant to post security for costs of the appeal in the amount of $20,000?

Holding: Motion dismissed.

Reasoning:

(1) No. The appeal has scant prospects of success and there is good reason to believe the appeal is frivolous. To succeed, the appellant would have to show that the trial judge made a palpable and overriding error in concluding she commenced the action out of time, and also in dismissing her case on the merits.

Although Justice Epstein’s order was made prior to the release of Chevron Corp. v. Yaiguaje, 2017 ONCA 827, which was included in the appellant’s materials, the decision did not alter the established test for ordering security for costs. The established test requires a judge, after analysing the specific factors spelled out in the rules, to consider the overall justness of the order sought. Epstein J.A. did not err in determining that ordering security for costs would be just. Unlike in Yaiguaje v. Chevron Corp, the appellant in this case has a direct economic interest in the appeal. The respondent is not a global enterprise but a not-for-profit senior citizens care centre operated by a church. Unrecoverable costs will reduce the respondent’s resources it can dedicate to the care of its clients. There is no indication the respondent sought security for costs as a litigation tactic to end the appeal. The appeal raises no overarching, important, or novel issue. There is no apparent overriding public interest in allowing the appeal to proceed without the posting of security for costs.

Hampton Securities Limited v. Dean, 2018 ONCA 216

[Fairburn J.A]

Counsel:

S J Erskine and D Barbaree, for the moving party

C J Somerville and D Hooper, for the responding party

Keywords: Civil Procedure, Appeals, Stay Pending Appeal, Rules of Civil Procedure, Rule 63.02(1), RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311

Facts:

The applicant is a registered investment firm. The respondent was employed at the firm as a trader. Her employment ended in 2009. The applicant maintains that the respondent was terminated with cause. The respondent maintains that she was constructively dismissed. On the day following the events leading to the respondent’s termination, the applicant filed a Notice of Termination (NOT) on the National Research Database (NRD). The NRD is maintained by the Investment Industry Regulatory Organization of Canada (IIROC). The NOT read: “Dismissed for cause…Failed to follow trading desk policies & procedures- unauthorized trading resulting in losses.” The applicant commenced an action against the respondent, claiming damages from losses she incurred as a trader. The respondent defended the action and counterclaimed for constructive dismissal and defamation. The trial judge found that the respondent had been constructively dismissed and defamed and ordered that the NOT be corrected. The applicant appealed that finding. This motion was for an order staying the trial judge’s order to correct the NOT, pending the determination of the appeal.

Issues:

(1) Should the order requiring that the NOT be changed be stayed until after disposition of the appeal?

Holding:

Motion dismissed.

Reasoning:

(1) No. Pursuant to rule 63.01(1), the monetary award against the applicant is automatically stayed pending resolution of the appeal. This motion relates to the applicant’s request under rule 63.02(1), that the trial judge’s order to amend the NOT be stayed pending disposition of the appeal. The test for a stay of a mandatory order pending appeal is the same as the test in RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311 for an injunction: First, a preliminary assessment must be made of the merits of the case to ensure that there is a serious question to be tried. Secondly, it must be determined whether the applicant would suffer irreparable harm if the application were refused. Finally, an assessment must be made as to which of the parties would suffer greater harm from the granting or refusal of the remedy pending a decision on the merits.

The applicant raised numerous grounds of appeal. For purposes of this motion, he focusses on the suggestion that the trial judge erred in finding that the NOT was defamatory, that the defamation claim was properly met by the defence of qualified privilege, and that the trial judge exceeded his jurisdiction by making the mandatory order to amend the NOT. The Court found that this was sufficient to satisfy the first stage of the analysis.

The applicant argued that the appeal could be rendered moot if the NOT were to be amended, as the order rests on a finding of defamation, which is subject to the appeal. The applicant argues that this would cause irreparable harm to its interests. The Court of Appeal disagreed, noting that if the appeal succeeds the NOT can simply be changed back to what it was originally or amended to reflect any remedy granted. Accordingly, irreparable harm was not established. Not having established irreparable harm, the applicant could not establish that the balance of convenience was in its favour either. The motion for a stay of the mandatory aspect of the trial judge’s order was therefore dismissed.

Susin v. Susin, 2018 ONCA 220

[Fairburn J.A.]

Counsel:

John Susin, in person

Sarah Whitmore, duty counsel

Margaret Hoy, via teleconference

Keywords: Civil Procedure, Extension of Time, Security for Costs

Facts:

The parties’ father passed away in 1997. After years of litigation, his estate is virtually non-existent. John Susin represented himself, and purported to speak on behalf of his sister, on this motion to obtain an extension of time.

In September 2015, Esther brought a motion in the Superior Court of Justice for directions in relation to her father’s estate. The motion was dismissed as an abuse of process. She then moved before Ramsay J. to set aside that finding, claiming that it had been obtained by fraud. She also asked to have the executor of the estate, her brother Fermino Susin (the respondent on this motion), cited in contempt. Esther was wholly unsuccessful in obtaining the relief she sought.

The moving parties seek an extension of time to bring a motion to set aside an order of Gillese J.A. requiring that they each post $15,000 as security for costs of their appeal from the lower court decision.

Issue: Should the moving parties be granted an extension of time to bring a motion to set aside Gilesse J.A.’s order for security for costs?

Holding: Motion dismissed.

Reasoning:

No. The test for an extension of time for filing a notice of appeal provides guidance on the relevant criteria for consideration in this context.  The question is whether the “justice of the case” requires that the extension be given. In Howard v. Martin, the Court of Appeal set out the relevant criteria to be considered in applying the test:

(1) whether the moving party formed a bona fide intention to appeal within the relevant period;

(2) the length of, and explanation for, the delay in filing;

(3) any prejudice to the responding party that is caused, perpetuated or exacerbated by the   delay; and,

(4) the merits of the proposed appeal.

For all intents and purposes, the moving parties in this case formed a bona fide intention to challenge the security for costs order within the required time. For the sake of argument, the Court was also prepared to accept that the failure to file the notice of motion resulted from an oversight on the part of the moving parties. Although these factors could be said to weigh toward allowing the extension of time, the other factors weigh strongly against granting this order. Not only is there no merit to the motion to set aside the order of Gillese J.A., but the respondent will be significantly prejudiced by allowing this matter to be taken any further.

The moving parties have failed to show any reason why the order for security for costs is wrong. A decision about whether to require security for costs is a discretionary one that must be afforded deference. Having regard to all of the circumstances, including the seemingly meritless attempt to challenge Gillese J.A.’s order and the multiple and hefty unpaid costs orders, the interests of justice require that the request for an extension of time to bring a motion to set aside the security for costs order be dismissed.

Metropolitan Toronto Condominium Corporation No. 723 v. Reino, 2018 ONCA 223

[Doherty, MacFarland and Paciocco JJ.A.]

Counsel:

Derek J. Bell and Brendan Clancy, for the appellant

Mark H. Arnold, for the respondent

Keywords:  Real Property, Condominiums, Status Certificates, Estoppel, Condominium Act, 1998, S.O. 1998, c. 19, s. 76

Facts:

The respondent, Dante Reino, purchased the condominium unit from his mother in 2013. He requested a status certificate at that time and was issued a “clean” certificate. When Mr. Reino decided to sell his unit in 2016, he requested another status certificate from the condominium corporation. This status certificate indicated the respondent had breached the condominium corporation’s declarations by altering the unit. The appellant acquired the unit in 2013 from his mother who had owned the unit since 2004. At the time of her purchase, she had received a “clean” certificate from the Condominium Corporation as did her son in 2013. The respondent’s evidence, accepted by the application judge, was that neither he nor his mother had carried out any alteration to the unit as described in the 2016 certificate. Despite the fact that representatives of the condominium corporation had been in the unit numerous times over the course of Reino’s occupancy – no one ever mentioned that the layout had been improperly altered.

The application judge concluded that s. 76 of the Condominium Act, 1998 was clear and unequivocal and that the condominium corporation was bound to its clean and clear status certificates from 2004 and 2013, and that it could not rely on the alleged breach in its 2016 status certificate. Furthermore, the condominium corporation was estopped from relying on its 2016 status certificate.

Issues:

(1) Did the application judge err in finding that the condominium corporation was bound by the clean certificate it provided in 2013?

(2) Did the application judge err in finding that the condominium corporation was estopped from issuing anything but a clean certificate?

Holding: Appeal allowed.

Reasoning:

(1) The condominium corporation is bound vis-à-vis the respondent Mr. Reino by the clean certificate it provided to him when he acquired the unit from his mother in 2013. The respondent has a remedy if the condominium corporation negligently issued the clean status certificate to him, to his detriment. He can sue the condominium corporation for any diminution in the value of his unit by reason of any improper disclosure that may have occurred – provided he does so before the limitation expires. In this sense, he is entitled to rely on the Certificate issued to him in 2013 and the condominium corporation is bound by it.

(2) While the condominium corporation is bound by the clean status certificate vis-à-vis the respondent, it does not follow that the condominium corporation is thereafter estopped from issuing anything but a “clean certificate” in relation to a unit where it has previously provided a clean certificate. If a condominium corporation becomes aware, after issuing a clean certificate, of a circumstance that is required to be disclosed by virtue of s. 76 or the regulations, it must include such information when it next issues a certificate. This does not change the fact that it will still be bound by its earlier certificate vis-à-vis the purchaser at the time or his mortgagee. Here, where the condominium corporation discovered that the unit layout had been switched between the time it issued its 2013 certificate and when it issued its 2016 certificate, it was obliged to include that information in the new certificate. To do otherwise would be misleading to the new prospective purchaser.

DBDC Spadina Ltd. v. Walton, 2018 ONCA 232

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

Counsel:

Peter H. Griffin, D. Glatt and S.N. Roy, for the appellants

Rosemary A. Fisher, for the respondents

Keywords: Civil Procedure, Costs, Fraud, Rule 57.01, Rules of Civil Procedure, Boucher v. Public Accountants Council (Ontario) (2004), 71 O.R. (3d) 291 (C.A.)

Facts:

The appellants, DBDC Spadina Ltd., who were successful on all aspects of the appeal, sought some of their costs of the application in the court below. In particular, they sought an order for the same amounts that were awarded to the respondents Christine DeJong Medicine Corporation (“DeJong”) and Dennis and Peggy Condos (the “Condos”) in the court below, namely $51,885.55 from DeJong and $14,017.28 from the Condos. They submitted that this is a significant and fair discount of their actual costs of approximately $300,000, which recognized that the appellants and the respondents were all victims of the Waltons’ fraud.

The respondents requested that the parties bear their own costs of the application. They pointed to the fact that this was a contest between victims, and that the practical effect of the court’s judgment was that they will recover almost nothing from the proceeds of the Schedule C Properties in which they invested.

Issue: What is the appropriate cost award?

Holding: Appellants awarded costs of the underlying application fixed at $51,885.55 against DeJong and $14,017.23 against the Condos.

Reasoning:

Costs are in the discretion of the court. The factors relevant to the exercise of discretion are set out in Rule 57.01 of the Rules of Civil Procedure. They include the result and relative success of each party, the complexity of the proceeding, the importance of the issues and the conduct of any party that impacted the duration of the proceeding. The court must consider the purposes of costs, which include both the indemnification of successful litigants for costs of the litigation and the facilitation of access to justice: Boucher v. Public Accountants Council (Ontario) (2004), 71 O.R. (3d) 291 (C.A.), at paras. 35-37.

The court stated that there was no question that the appellants were the successful parties, and that they would reasonably expect to be awarded their partial indemnity costs of the application, which would exceed the costs they now claim. The only issue is the impact of the fact that all of the parties were victims of the Waltons’ fraud. The court held that the appellants’ request that they be awarded the costs that the application judge awarded against them at first instance, is a reasonable response to both factors.

Accordingly, the appellants were entitled to their costs of the application fixed at $51,885.55 against DeJong and $14,017.23 against the Condos.

Douglas v. Stan Fergusson Fuels Ltd., 2018 ONCA 192

[Hoy A.C.J.O., Rouleau, Hourigan, Benotto and Roberts JJ.A.]

Counsel:

Amy Pressman and Diana Weir, for the appellants

Matthew Gervan, for the respondents

Keywords:  Bankruptcy and Insolvency, Property of Bankrupt, Undisharged Bankrupts, Trustees, Vesting of Property, Choses in Action, Insurance Law, Subrogation, Mariner Foods Ltd. v. Leo-Progress Enterprises Inc., 2017 ONCA 7, Civil Procedure, Striking Pleadings, Capacity to Sue, Orders, Nunc Pro Tunc, Amending Pleadings, Adding Parties, Limitation Periods, Appeals, Stare Decisis, Powers on Appeal, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, ss. 38, ss. 40,  ss. 67, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 134

Facts: This was a five-panel decision of the Court of Appeal.

Art and Wendy Douglas purchased a home in Kingston, Ontario and arranged for the appellants to deliver fuel oil to their home. On January 9, 2008, fuel oil was delivered to the Douglases’ external oil tank. It is alleged that the fuel oil subsequently escaped and contaminated the Douglases’ property. The Douglases’ insurer, State Farm, appointed an adjuster, who determined that their Homeowners Policy provided coverage for losses associated with the spill. At the time of the oil leak, Wendy Douglas had no ownership interest in the property. Several months prior, she had been discharged from bankruptcy subject to the stipulation that her interest in the property remained vested in her trustee in bankruptcy. The Trustee remained on title to the property, together with Mr. Douglas.

The adjuster for the appellants sent invoices from the clean-up to State Farm. State Farm paid the invoices, and advised that it intended to recover these and any future clean-up costs from the appellants. The Homeowners Policy also contained a subrogation clause. Mr. Douglas filed an assignment in bankruptcy. The Trustee also became Mr. Douglas’s trustee in bankruptcy and replaced him on the title to the property. The week before Mr. Douglas filed his assignment, the Trustee signed a document entitled the “Trustee’s Limited Disclaimer” (the “Disclaimer”). The Disclaimer was addressed to State Farm, and recited the Trustee’s intention to sell the property as soon as it was remediated. It also disclaimed interest in insurance claims by the Douglases “for loss or damage in the oil spill to matrimonial household contents not affixed or enjoyed with the residential property or proceeds of personal property exempt under the Execution Act (Ontario) which would not vest in their Trustee in Bankruptcy.”

State Farm paid out the Douglases’ personal contents claims, and the Trustee sold the remediated property and satisfied the creditors. In January, 2010, State Farm commenced an action against the appellants in the names of Art Douglas and Wendy Douglas. The damages claimed were not restricted to those described in the Disclaimer. The action was commenced prior to Mr. Douglas’s discharge.

The issue of the Douglases’ capacity to bring this action came before the court in 2013, when the appellants brought a motion to strike the claim, arguing that the Douglases lacked capacity to commence the action because of their bankruptcies, and accordingly State Farm’s action in their names was a nullity. State Farm brought a cross-motion for: (a) directions with respect to the continuation of the action in the Douglases’ or its own name; (b) alternatively, for a declaration that it was the dominus litis and had the right to continue and control the action to pursue its subrogated claim; and (c) in the further alternative, an order permitting it to amend its statement of claim to plead that the plaintiffs were “Art Douglas and Wendy Douglas by their Subrogee State Farm Fire & Casualty Company”.

Both the motion judge and the Divisional Court allowed State Farm’s claim to proceed, emphasizing substance over form. The appellants appealed to the Court of Appeal.

Issues:

(1) Had State Farm acquired a property interest in Mr. Douglas’s cause of action at the time that he made his assignment, such that the cause of action did not vest in the Trustee?

(2) If not, did the subrogation clause in the Homeowners’ Policy permit State Farm to commence an action in the name of Mr. Douglas, who is an undischarged bankrupt?

(3) If the answer to the first two questions was “no”, could the court make an order under ss. 38 or 40 of the BIA to remedy the procedural impediment to State Farm’s subrogated action?

(4) Should the court regularize State Farm’s subrogated action by substituting the Trustee as plaintiff?

Holding: Appeal allowed.

Reasoning:

(1) No. The cause of action did not vest in State Farm before Mr. Douglas’s bankruptcy by operation of the common law doctrine of subrogation. When an insurer is subrogated to the claim of its insured, the claim nonetheless remains that of the insured in whose name and with whose rights the claim must be advanced. Mr. Douglas did not assign his cause of action to State Farm by operation of the common law doctrine of subrogation. State Farm’s argument that the right to any proceeds of the litigation that might be recovered could not vest in the Trustee by virtue of s. 67(1)(a), and therefore the cause of action to recover those proceeds could not have vested in the Trustee, was rejected.

Although certain categories of property are not divisible among creditors, such property becomes part of the bankrupt’s estate in the possession of the trustee. An insured that makes a recovery from a wrongdoer, and has recouped the costs of recovery, holds the rest in trust for the insurer up to the value of the insurer’s payment. The proceeds of such litigation would constitute trust property in the possession of the Trustee, although not available for distribution to creditors, pursuant to s. 67(1)(a) of the BIA. The cause of action giving rise to those proceeds would similarly be in the possession of the Trustee.

In Mariner Foods Ltd. v. Leo-Progress Enterprises Inc., the Court of Appeal had cited the Divisional Court’s decision in this proceeding for the principle that a subrogated claim brought by an insurer is not caught by a bankruptcy. Mariner was decided while this appeal was pending, without reference to binding judicial authority or analysis. The broad principle enunciated in Mariner conflated the concepts of subrogation and assignment and is incorrect in law. The per curiam exception to stare decisis applies, and Mariner was overruled to the extent it stands for that principle.

The subrogation clause in the Homeowners Policy did not amount to an assignment of Mr. Douglas’s cause of action. There is a difference between subrogation and assignment. State Farm is a sophisticated insurer. It would have been a simple matter for it to include an assignment clause in the Homeowners Policy if it indeed intended that Mr. Douglas assign his cause of action to it.

Further, the Trustee did not disclaim its interest in the cause of action through the Disclaimer. The Disclaimer is twice removed from an assignment of the cause of action to State Farm: (1) it disclaims insurance claims by the Douglases against State Farm, not tort claims by the Douglases against the appellants; (2) it is limited to matrimonial household contents and personal property exempt from seizure. The Disclaimer operated as no more than a signal from the Trustee to State Farm that insurance proceeds for damage to excluded property could be paid out directly to the Douglases. At the time Mr. Douglas made his assignment in bankruptcy, State Farm had not acquired any proprietary interest in the cause of action; Mr. Douglas had not assigned his cause of action to State Farm; and the Trustee had not disclaimed its interest in the cause of action by executing the Disclaimer.

(2) No. the Trustee acquired Mr. Douglas’s cause of action subject to State Farm’s contractual right of subrogation under the Homeowners’ Policy. However, long established bankruptcy law principles prevented the exercise of that right in the manner that State Farm sought to do so. The jurisprudence is clear that an undischarged bankrupt lacks capacity to commence an action in his name, if his cause of action vested in the trustee on his assignment or at any time before his discharge. Mr. Douglas’s cause of action vested in the Trustee on his assignment. At the time that State Farm commenced the action in Mr. Douglas’s name, Mr. Douglas did not have the capacity to commence the action. As the Trustee acquired Mr. Douglas’s cause of action subject to State Farm’s right of subrogation, State Farm was entitled to commence the action in the Trustee’s name. This conclusion gives effect to both the objectives and principles of the doctrine of subrogation and established principles of bankruptcy law. The doctrine of subrogation is rooted in the principle of indemnity and State Farm indemnified the Trustee for Mr. Douglas’s loss; under bankruptcy law, the Trustee, and not Mr. Douglas, had the capacity to commence the action; and under the doctrine of subrogation, upon becoming the dominus litus, State Farm (and not the Trustee) was entitled to control the litigation. Upon bankruptcy, it makes sense to read the subrogation clause in an insurance policy as if the trustee’s name appears in place of that of the bankrupt insured, just as is required to be done for the purposes of entitlement to indemnification under the insurance policy – at least where, as here, the Trustee has taken the benefit of the insurance policy. Therefore, while State Farm was entitled to commence a subrogated action, it was required to commence the action in the name of the Trustee, and not that of Mr. Douglas.

(3) No, State Farm is not entitled to a remedial order under ss. 38 or 40 of the BIA. Section 40(2) permits the court to grant an order disposing of any property that is incapable of realization where the trustee has been unable to dispose of such property. Orders pursuant to s. 40 can be granted on a nunc pro tunc basis in the appropriate case. The Divisional Court did not purport to grant an order under s. 40(2), re-vesting Mr. Douglas’s action in him, effective before State Farm commenced the action in his name. Assuming this cause of action could be seen as unrealizable property in the hands of the Trustee, there are two reasons why an order under s. 40(2) cannot normalize these proceedings.

First, an order under s. 40(2) re-conveying a cause of action to an undischarged bankrupt does not provide the bankrupt with capacity to commence the claim. To normalize this cause of action, State Farm would require an order under s. 40(2) effective on January 6, 2010, which is the day before it commenced the action in Mr. Douglas’s name. But Mr. Douglas did not receive an absolute discharge from bankruptcy until March 5, 2010. Although the court can vary a bankrupt’s date of discharge in certain circumstances, it cannot do so here. Therefore, it cannot grant an order under s. 40(2) re-conveying this cause of action to Mr. Douglas, effective January 6, 2010. Second, a nunc pro tunc order cannot be made in this case because of the passage of the relevant limitation period.

State Farm requested an alternate order under s. 38 of the BIA assigning the cause of action to State Farm on a nunc pro tunc basis. Such an order cannot be granted. State Farm did not comply with the procedure required by s. 38. It did not request the Trustee to take a proceeding against the appellants and did not bring a motion for an order authorizing State Farm to take the proceeding in its own name and at its expense and risk. Most significantly, the Trustee is not a party to this action. Indeed, there is no indication that the Trustee, who is now discharged, was even given notice that State Farm would seek an order against the Trustee on appeal under s. 38 of the BIA.

(4) No, the court cannot and should not grant this relief. Even if State Farm’s naming of Art Douglas as the plaintiff could be considered a “misnomer” and s. 41(10) of the BIA would permit the court to amend the style of cause after the Trustee’s discharge to substitute the name of the Trustee, as trustee of the estate of Art Douglas, a bankrupt, for that of Mr. Douglas, the court cannot, or if it can, should not, grant this relief at this juncture. First, an order under r. 5.04(2) substituting the name of the Trustee for that of Mr. Douglas, effective upon the issuance of the statement of claim, was not an order that ought to or could have been made by the motion judge, and therefore is not an order that the court can make under s. 134(1)(a).

Second, such an order would not be “just” in the circumstances, and thus the court cannot and should not grant such relief under s. 134(1)(c) of the Courts of Justice Act. The Court cited a number of reasons, including that it is not appropriate for an appellate court, twice removed from the parties’ initiating motion, to grant this relief; the appellants have not had the opportunity to make full submissions on this new issue; the “irregularity” that State Farm seeks to correct was intentional; the delay in seeking the alternate relief was significant; the pleadings would be deficient and unable to support an ongoing action by the Trustee without further amendments; and State Farm is a sophisticated party.

The entire panel allowed the appeal, and the majority (3 out of five), dismissed State Farm’s claim in the name of Art Douglas, without State Farm being granted leave to regularize the claim by substituting the Trustee’s name as plaintiff.

Rouleau and Roberts JJ.A. (Dissenting in part):

The minority, Rouleau and Roberts JJ.A., did not agree that the claim should be outright dismissed, and would have remitted the matter back to the Superior Court to permit State Farm to bring a motion to regularize the claim by substituting the Trustee’s name for Douglas’ name as plaintiff.

 Holtby v. Draper, 2018 ONCA 231

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

Counsel:

A M Franks and M Zalev, for the appellant

W R Clayton, for the respondent

Keywords: Family Law, Property, Co-ownership, Resulting Trust, Unjust Enrichment, Costs

Facts:

The appellant, Cheryl Draper, and the respondent, Ken Holtby, were married and co-owned property. Ms. Draper appealed the trial judge’s decisions on property ownership. Ms. Draper was the sole registered owner of Lot 8. The trial judge determined that, by way of resulting trust, Mr. Holtby was the beneficial owner of the entirety of Lot 8. On appeal, the Court of Appeal concluded instead that the parties were joint beneficial owners of the property. It followed from this, as reasonable and appropriate, that Ms. Draper was entitled to occupation rent for her half of the property during the lengthy period of time that Mr. Holtby had sole use of the property in its entirety (and Ms. Draper made mortgage and property tax payments). Given the finding of joint beneficial ownership and entitlement to occupation rent, the Court of Appeal also set aside the trial judge’s award reimbursing Ms. Draper for the payments she made toward the property in its entirety, while noting that Ms. Draper “may be entitled to reimbursement from Mr. Holtby for certain payments she made”. This decision are the supplementary reasons of the Court of Appeal dealing with the amount awarded for Lot 8, and costs.

Issues:

(1) Should Ms. Draper receive an additional amount in respect of Lot 8, as a result of the finding on appeal?

(2) In light of her success on appeal, should the cost award against Ms. Draper be reduced?

Holding:

Appeal allowed.

Reasoning:

(1) Ms. Draper made all mortgage and property tax payments on Lot 8 from May 1996 to December 2015. She claims $30,788.51, which is one-half of the total amount she paid. The basis for the claim is that Mr. Holtby was unjustly enriched by Ms. Draper’s payment of his share of the mortgage and property tax payments on his one-half interest in the property. Mr. Holtby argued that he incurred all of the input costs and did all of the work, or paid for the work, to generate income from Lot 8. He argued, therefore, that there was no unjust enrichment as Ms. Draper will benefit from receiving 50% of the net proceeds from the eventual sale of Lot 8, the value of which has appreciated considerably since its acquisition in 1999. The Court of Appeal disagreed, as it found that the basis for Ms. Draper’s entitlement to half of Lot 8 is not by way of constructive trust but rather a resulting trust interest, her entitlement to 50% of the proceeds of its sale does not compensate her for the payments she made towards Mr. Holtby’s share of the property. The law of unjust enrichment entitles Ms. Draper to recovery provided she can establish that Mr. Holtby was enriched by these payments to her detriment in the absence of a juristic reason. The trial judge found that Ms. Draper was under no obligation to make out-of-pocket payments towards the mortgage and property taxes for Mr. Holtby’s property. To allow him to retain such payments would unjustly enrich Mr. Holtby at Ms. Draper’s expense. The Court of Appeal, therefore, awarded Ms. Draper the sum of $30,788.51 plus prejudgment interest for the amounts she paid in relation to Mr. Holtby’s half of Lot 8.

An additional amount of $7,125 was also awarded for occupation rent for the post-trial period. Although this issue was raised for the first time on appeal, Mr. Holtby had been on notice since trial that Ms. Draper was claiming occupation rent and therefore the Court of Appeal entertained her submissions.

(2) Ms. Draper was ordered by the trial judge to pay Mr. Holtby all-inclusive costs of $100,000. Mr. Holtby was successful at trial and on appeal on the issue of ownership of Knapton. Ms. Draper gained joint beneficial ownership of Lot 8 on appeal. By comparison, the other issues at trial were minor, or depended on these determinations of ownership. The Court of Appeal found, therefore, that their relative success was evenly balanced and that each party should therefore bear their own costs.

Criminal Decisions:

R v. Truong, 2018 ONCA 217

[Strathy C.J.O., Simmons and Hourigan JJ.A.]

Counsel:

Daniel Stein, for the appellant

Sandy Thomas, for the respondent

Keywords: Criminal Law, Drug Trafficking

R v. Boussoulas, 2018 ONCA 222

[Strathy C.J.O., Simmons and Hourigan JJ.A]

Counsel:

Randall Barrs, for the appellant

Alexander V. Hrybinsky, for the respondent

Keywords: Criminal Law, Firearms Offence, Fresh Evidence, Telewarrant, Unreasonable search, Charter of Rights and Freedoms, ss. 8, 24,  R. v. Garofoli, [1990] 2 S.C.R. 1421, R. v. Rocha, 2018 ONCA 84, Sentencing

R v. Currie, 2018 ONCA 218

[Strathy C.J.O., Simmons and Hourigan JJ.A.]

Counsel:

Mark Halfyard, for the appellant

Dena Bonnet, for the respondent

Keywords: Criminal Law, Dangerous Driving Causing Bodily Harm, Impaired Driving, Sentencing, Youthful First Offender, R. v. Rawn, 2012, ONCA 487

R v. Ariri, 2018 ONCA 226

[Pardu, Benotto and Nordheimer JJ.A.]

Counsel:

Godwyn Ariri, self-represented

Hannah Freeman, for the respondent

Keywords: Criminal Law, Ineffective Assistance of Counsel

R v. Lubansa, 2018 ONCA 227

[Rouleau, Huscroft and Fairburn JJ.A]

Counsel:

Melanie Webb, for the appellant

Mabel Lai, for the respondent

Keywords: Criminal Law, Fraud Over $5,000, Unlawful Detention, Charter of Rights and Freedoms, ss. 8, 9 & 10, Sentencing

R v. Pitters, 2018 ONCA 234

[Pardu, Benotto and Nordheimer JJ.A.[

Counsel:

Troy Pitters, acting in person via videoconference

Lorna Bolton, for the respondent

Keywords: Criminal Law, Attempted Murder, Sentencing, R. v. Stubbs, 2013 ONCA 514

R v. Shah, 2018 ONCA 236

[Pardu, Benotto and Nordheimer JJ.A.]

Counsel:

Robert Shah, self-represented

Lorna Bolton, for the respondent

Keywords: Criminal Law, Robbery, Aggravated Assault, Sexual Assault, Sentencing

R v. Yang, 2018 ONCA 230

[Rouleau, Huscroft and Fairburn JJ.A.]

Counsel:

Kathleen Farrell, for the appellant

Mark Ertel, for the respondent

Keywords: Criminal Law, Careless Use of a Firearm, Criminal Code, s. 86(3), R. v. Pham, 2013 SCC 15

Short Civil Decisions:

Dada v. Brantford Communities Ltd., 2018 ONCA 209

[Feldman, Benotto and Brown JJ.A.]

Counsel:

Derek Schmuck, for the appellants

Brendan Clancy, for the respondents

Keywords: Contracts, Real Property, Agreements of Purchase and Sale of Land, Breach, Unconscionability, Negligence, Redstone Enterprises v. Simple Technology Inc., 2017 ONCA 282

Destaron Property Management Ltd. v. Hindmarsh, 2018 ONCA 200

[Feldman, Pardu and Benotto JJ.A.]

Counsel:

Howard Borlack and Miranda E. Serravalle, for the appellants

Robert W. Dowhan and James Prosser, for the respondent

Keywords: Contracts, Real Property, Commercial Leases, Releases, Insurance

Raibex Canada Ltd. v. ASWR Franchising Corp., 2018 ONCA 221 (Costs)

[Sharpe, Blair and Epstein JJ.A.]

Counsel:

Geoffrey B. Shaw and Christopher Horkins, for the appellants

David S. Altshuller and Lara Di Genova, for the respondents

Keywords: Contracts, Franchise Agreements, Rescission, Costs

Fleming v. Ontario, 2018 ONCA 225 (Costs)

[Cronk, Huscroft and Nordheimer JJ.A.]

Counsel:

Judie Im, Erin Rizok and Sean Hanley, for the appellants

Michael Bordin and Jordan Diacur, for the respondent

Keywords: Torts, Battery, Costs, Public Interest Litgation, Odhavji Estate v. Woodhouse, 2003 SCC 69

Growthworks Commercialization Fund Ltd., v. Growthworks WV Management Ltd., 2018 ONCA 233

[Epstein, van Rensburg and Brown JJ.A.]

Counsel:

Melvyn Solmon and Cameron Wetmore, for the appellant

Geoff R. Hall and Emily M. MacKinnon, for the respondent

Keywords: Corporations, Contracts, Interpretation, Dividends, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53

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.