Author: John Polyzogopoulos

For years, our firm has been preparing weekly summaries of decisions just released by the Court of Appeal for Ontario (other than criminal law decisions) for internal distribution, usually on Friday afternoons. On more than one occasion, our lawyers have relied on decisions they learned about over the weekend at their hearings the following week. We have now decided to share our summaries with the Ontario bench and bar. We hope that you find this service useful and welcome your comments. John Polyzogopoulos, a partner in our Commercial Litigation group, is the editor of this blog. Feel free to contact John regarding any suggestions you may have or with respect to any possible referrals of litigation matters to our firm. John can be reached at 416.593.2953 or jpolyzogopoulos@blaney.com. With over 80 litigators, Blaneys has the expertise and bench strength to take on any kind of litigation matter. We provide quality depth that is on par with the national firms, personal service to rival litigation boutiques, all while having a cost structure that allows us to be very competitive with our rates. Here is a sampling of what we do: • Counsel and Appellate work • Commercial Litigation (including corporate litigation, injunctions, insolvency and banking) • Construction • Labour and Employment • Family • Intellectual Property Litigation • Class Actions • Administrative Law • Aboriginal • Insurance Law, including: • Insurance Coverage Advice • Product Liability • Professional Liability • MVA/Personal Injury/Medical Malpractice • Government Liability 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 (MAY 13- MAY 18)

Good afternoon.

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

Off the top, I would like to congratulate our very own Roger Horst and Rafal Szymanski on successfully representing the respondent in Correct Building Corporation v. Lehman. The Court dismissed the appeal against our client and granted our client’s cross-appeal, resulting in a dismissal of all claims against our client by way of summary judgment.

Other topics covered this week included whether a landlord’s insurer can bring a subrogated claim against a tenant of a commercial property for negligence causing fire, a fee dispute between lawyer and client, uninsured motorist coverage, agreements of purchase and sale of land and setting aside consent orders. The Court also denied leave to appeal the provincial offences convictions arising out of the Sunrise Propane incident in North York that took place almost ten years ago now.

Wishing everyone an enjoyable Victoria Day (and royal wedding) long weekend.

John Polyzogopoulos

Blaney McMurtry LLP

jpolyzogopoulos@blaney.com

Tel: 416 593 2953

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

Table of Contents 

Skunk v. Ketash, 2018 ONCA 450

Keywords: Contract Law, Contractual Interpretation, Insurance Law, Rules of Civil Procedure, Rule 21.01, Uninsured Vehicles, OPCF 44R Family Protection Coverage Endorsement, R. v. Clarke, 2013 ONCA 7

Sri Guru Nanak Sikh Centre Brampton v. Rexdale Singh Sabha Religious Centre, 2018 ONCA 459

Keywords: Civil Procedure, Settlements, Enforceability, Standard of Review, Palpable and Overriding Error

Ehsaan v. Zare, 2018 ONCA 453

Keywords: Summary Judgment, Costs, Real Property, Damages, Appraisals, Davies v. Clarington, 2009 ONCA 722, Ontario Ltd. v. Niagara (Regional Municipality), [2005] O.J. No. 1907

Royal Host GP Inc. v. 1842259 Ontario Ltd., 2018 ONCA 467

Keywords: Contracts, Interpretation, Real Property, Commercial Leases, Covenant to Insure, Tenant Negligence, Fire, Subrogation, Agnew-Surpass v. Cummer-Yonge, [1976] 2 S.C.R. 221, Ross Southward Tire v. Pyrotech Products, [1976] 2 S.C.R. 35, T. Eaton Co. v. Smith et al., [1978] 2 S.C.R. 749

Lang Michener LLP v. King, 2018 ONCA 471

Keywords: Contracts, Solicitor and Client, Torts, Solicitor’s Negligence, Costs

Correct Building Corporation v. Lehman, 2018 ONCA 462

Keywords: Torts, Negligent Misrepresentation, Fraudulent Misrepresentation, Conspiracy, Negligence, Inducing Breach of Contract, Wrongful Interference with Economic Relations, Summary Judgment

Civil Decisions

Skunk v. Ketash, 2018 ONCA 450

[Rouleau, Roberts and Fairburn JJ.A.]

Counsel:

Edward S.E. Kim, for the appellant

Alex W. Demeo, for the respondent, Jevco Insurance Company

Keywords: Contract Law, Contractual Interpretation, Insurance Law, Rules of Civil Procedure, Rule 21.01, Uninsured Vehicles, OPCF 44R Family Protection Coverage Endorsement, R. v. Clarke, 2013 ONCA 7

Facts:

This is an appeal from the determination of a legal question under Rule 21.01 of the Rules of Civil Procedure, resulting in the dismissal of the appellant’s claim against the respondent insurer. The appellant was a passenger in his spouse’s vehicle when it was taken without consent by an uninsured driver, Laurel Ketash. The vehicle was then involved in an accident and the appellant was injured. The motion judge determined that the appellant’s spouse had no applicable and collectible bodily injury liability insurance because Ms. Ketash was driving the vehicle without the owner’s consent. He concluded that because the appellant’s spouse owned the vehicle, he was excluded from uninsured automobile coverage under the Insurance Act, R.S.O. 1990, c I.8, the Ontario Automobile Policy (OAP) and the OPCF 44R Family Protection Coverage Endorsement.

Section 265(2) of the Insurance Act provides a definition of an “uninsured automobile. Section 1.11 of the OPCF 44R Family Protection Coverage, reads in virtually identical terms to those included in the appellant’s policy: an “uninsured automobile …does not include an automobile owned by or registered in the name of the insured or his or her spouse”. The motion judge found no ambiguity in the plain language of the statute or the contractual policies at issue and concluded that the language is clear on its face.

Issues:

(1) Did the motion judge err in his interpretation of section 1.11 of the insurance policy?

Held: Appeal Dismissed

Reasons:

(1) No. The principles of statutory interpretation require that the court first look to the plain meaning of the statute. If the words have a plain meaning and give rise to no ambiguity, then the court should give effect to those word as per R. v. Clarke, 2013 ONCA 7. The meaning of the definition of “uninsured automobile” under s. 265(2) is clear and unambiguous: “uninsured automobile means … but, does not include an automobile owned by or registered in the name of the insured or his or her spouse [emphasis added].”

As a general rule, clauses in insurance policies will be granted a liberal meaning “in favour of the insured and those clauses excluding coverage will be construed strictly against the insurer. The difficulty here is that the provision, virtually identical to the wording of the same definition of “uninsured automobile” under s. 265(2), is clear on its face. In order to arrive upon the appellant’s interpretation of the provision, it would be necessary to read words into the provision. The provision would have to be interpreted as meaning that an “uninsured automobile … does not include an automobile owned by or registered in the name of the insured or his or her spouse, [but only where the insured or his or her spouse has deliberately chosen not to insure the vehicle].”

Reading the words out of an insurance policy or giving the words an opposite meaning is not synonymous with a liberal interpretation. The same can be said for adding the phrase that would be required to give effect to the appellant’s submission. The fact that this may produce a “harsh result” does not mean that it is an absurd result, as it is in accordance with the plain meaning of the unambiguous provision.

Sri Guru Nanak Sikh Centre Brampton v. Rexdale Singh Sabha Religious Centre, 2018 ONCA 459

[Lauwers, Benotto and Nordheimer JJ.A.]

Counsel:

M Wiffen, for the appellant

P Baxi, for the respondent, Sri Guru Nanak Sikh Centre Brampton

J Nussbaum, for the respondent, Rexdale Singh Sabha Religious Centre

Keywords: Civil Procedure, Settlements, Enforceability, Standard of Review, Palpable and Overriding Error

Facts:

The defendant, Sikh Spiritual Centre Toronto, appeals from the judgment of the motion judge refusing to set aside the consent order of Justice Mark Edwards dated February 4, 2016 that enforced a settlement between the parties.

Issues:

(1) Did the motion judge err by refusing to set aside the consent order that enforced a settlement between the parties?

Holding: Appeal dismissed.

Reasoning:

(1) No. The motion judge gave very lengthy reasons for her decision.  She reviewed, in detail, the factual background of this matter including how the loan came about, the commencement of the litigation, and the steps that were taken that led to the settlement.  The motion judge concluded that the settlement had been entered into by a Director of the appellant who was authorized to do so.  The motion judge also pointed out that the appellant was represented by counsel throughout the proceeding, including all aspects of the settlement.  Finally, the motion judge concluded that there was no proper basis for her to exercise her discretion not to enforce the settlement.  It was clear, in the motion judge’s view, that the appellant had borrowed the monies in question and that the settlement, by which most of the monies were to be repaid over time, was a reasonable one.

The conclusions reached by the motion judge are entitled to deference by this court. Given that those conclusions reflect findings of fact, this court can only interfere if the appellant demonstrates that the motion judge has made palpable and overriding errors: Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235.  The appellant has failed to do so in this case.  It is not the role of this court to reweigh the evidence or to substitute our view of the evidence for that of the judge of first instance.

Ehsaan v. Zare, 2018 ONCA 453

[Rouleau, Roberts and Fairburn JJ.A.]

Counsel:

SNZ, for the appellant

SR, for the respondents

Keywords: Summary Judgment, Costs, Real Property, Damages, Appraisals, Davies v. Clarington, 2009 ONCA 722, Ontario Ltd. v. Niagara (Regional Municipality), [2005] O.J. No. 1907

Facts:

The appellant obtained judgment against the respondents on a motion for summary judgment. The appellant’s action arose out of a failed transaction to purchase the respondents’ property, which the respondents refused to close.

The motion judge granted the appellant judgment in the amount of $118,954.95, including $43,000 for the difference in value of the property from the date of the agreement of purchase and sale to the closing date. The motion judge ordered that there be no costs.

The appellant’s appeal is narrow: she takes issue with the amount of $43,000 awarded, submitting that the motion judge erred in taking the average between the parties’ respective property appraisals. She also seeks leave to appeal the motion judge’s order that she receive no costs of her action or motion for summary judgment.

With respect to the damages issue, at trial, there was a dispute between the parties as to the appropriate appraised value of the property. The appellant’s own appraisal evidence was that the value of the property was between $1.275 and $1.375 million as of the closing date. The respondents’ evidence appraised the property as of the closing date at a value of $1.375 million; however, they disputed that value and relied on the lower end of the appellant’s appraisal evidence. The motion judge concluded that there was “no basis for the court to prefer one or other of the appraisals” and determined that the “reasonable conclusion” would be to take the midpoint of the highest and lowest appraised values.

Issues:

(1) Did the motion judge err in its assessment of damages?

(2) Did the motion judge err in not awarding costs to the appellant?

Holding: Appeal allowed in part

Reasoning:

(1) No. The motion judge’s assessment and calculation of damages are entitled to deference. His explanation as to why he took the average of the figures submitted by the parties, including the absence of a basis to understand which appraisal was preferable, was reasonable on this record. We see no basis to interfere with it.

(2) Yes. It is well established that a costs award should be set aside on appeal only if the motion judge erred in principle or the award was plainly wrong: Davies v. Clarington, 2009 ONCA 722, at para. 27.

The motion judge erred in failing to award any costs to the appellant and that the error justifies appellate intervention. While an award of costs is always discretionary and the court has the discretion not to award any costs to the successful party, the latter discretion should be exercised sparingly. The general principle that a successful party is entitled to costs should not be departed from except for very good reasons. Examples of the exceptional instances where such an order has been made include: misconduct of the parties; miscarriage in the procedure; or oppressive and vexatious conduct of proceedings. (See: 1318706 Ontario Ltd. v. Niagara (Regional Municipality), [2005] O.J. No. 1907, at para. 50.)

Here, the motion judge erred by depriving the successful party of her partial indemnity costs for conduct that did not rise to the level of misconduct that would justify such a punitive order. It was neither fair, proportionate nor reasonable for the motion judge to deprive the appellant of all of her costs.

Royal Host GP Inc. v. 1842259 Ontario Ltd., 2018 ONCA 467

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

Counsel:

J C. Lisus and A J. Winton, for the appellant

D Rabinowitz and S D McGarry, for the respondents

Keywords: Contracts, Interpretation, Real Property, Commercial Leases, Covenant to Insure, Tenant Negligence, Fire, Subrogation, Agnew-Surpass v. Cummer-Yonge, [1976] 2 S.C.R. 221, Ross Southward Tire v. Pyrotech Products, [1976] 2 S.C.R. 35, T. Eaton Co. v. Smith et al., [1978] 2 S.C.R. 749

Facts:

The appellant owns a multi-story commercial building in which it operates a hotel. The respondents leased a portion of the building in which they operated a restaurant. A fire broke out in the respondents’ kitchen causing extensive damage to the building. The appellant was indemnified by its insurer for its losses and its insurer commenced this subrogated action, in the appellant’s name, seeking recovery of the damages suffered. The action alleges the fire was caused by the respondents’ negligence.

The respondents took the position that even if the fire were caused by their negligence, the terms of the lease prevented the appellant from bringing this action. The respondents brought a motion by way of special case seeking determination of whether the lease bars the plaintiff’s insurer from bringing a subrogated action for damages in the name of the plaintiff, as against defendants. Section 7.02 of the Lease provided as follows:

The Landlord shall take out and maintain, to the full replacement value, fire and other hazard insurance, as the Landlord in its sole discretion may deem advisable, on the Building, excluding any property thereon with respect to which the Tenant or other tenants are obliged to insure, and its own general liability insurance, including general liability insurance in respect of the Common Areas in an amount no less than $10,000,000.00 in respect of any injury to or death of one or more persons and loss or damage to the property of others, the costs of which shall be included in Common Expenses.

Notwithstanding the Landlord’s covenant contained in this Section 7.02, and notwithstanding any contribution by the Tenant to the cost of any policies of insurance carried by the Landlord, the Tenant expressly acknowledges and agrees that

  • the Tenant is not relieved of any liability arising from or contributed to by its acts, fault, negligence or omissions, and
  • no insurance interest is conferred upon the Tenant, under any policies of insurance carried by the Landlord, and
  • the Tenant has no right to receive any proceeds of any policies of insurance carried by the Landlord.

The motion judge concluded that the language in s. 7.02 referring to the tenant’s negligence did not create a right of subrogation for the landlord’s insurer and so dismissed the action. The motion judge had based their analysis on a trilogy of Supreme Court decisions, namely: Agnew-Surpass v. Cummer-Yonge, [1976] 2 S.C.R. 221, Ross Southward Tire v. Pyrotech Products, [1976] 2 S.C.R. 35, and T. Eaton Co. v. Smith et al., [1978] 2 S.C.R. 749.

Issues:

(1) Did the motion judge err in concluding that the language in s. 7.02 referring to the tenant’s negligence did not create a right of subrogation for the landlord’s insurer?

Holding:

Appeal allowed.

Reasoning:

(1) In this case, there was an agreed statement of facts and the motion judge’s reasoning was restricted to the interpretation of the wording of the lease in light of the legal principles enunciated in the trilogy. The motion judge’s analysis erred in principle by proceeding as if the Supreme Court, in the trilogy, pronounced a rule of general application. The motion judge repeatedly referred to “the general rule”. The starting point for the analysis is that in the trilogy the Supreme Court did not enunciate freestanding principles. The principles drawn from the trilogy are contractual in nature. They are conclusions that flow from and reflect the particular provisions of the leases that were in issue in those cases. In the trilogy, the Supreme Court determined that it is the terms of the lease that establish the rights and obligations between landlord and tenant, and not the insurance policy. The trilogy has not affected the fundamental tenet of contractual interpretation that it is necessary to discern the intentions of the parties in accordance with the language they have agreed to in the contract. The motion judge recognized that his task was to interpret the lease in accordance with the intentions of the parties, but he allowed the principles of the trilogy to override the plain language of the lease.

The first part of s. 7.02 of the lease in this case both obligates the landlord to purchase and maintain fire insurance on the building and requires the tenant to pay its proportionate share of the cost of such insurance. Section 7.02 continues with a “notwithstanding” provision. The plain meaning of s. 7.02 of the lease considered in isolation is that the tenant remains liable for its own negligence notwithstanding the landlord’s covenant to purchase insurance and the tenant’s contribution for the cost of that insurance.

The lease must be interpreted in accordance with the language the parties have used. In law, a tenant is liable for damage caused by its negligence. The question is whether the parties to a lease have contracted that the ordinary principles of negligence law will not apply and the tenant will not be liable to the landlord for damages caused by its negligence. Here, the Court of Appeal has found that the parties have not done so.

Lang Michener LLP v. King, 2018 ONCA 471

[Brown, Huscroft and Trotter JJ.A.]

Counsel:

GK, acting in person

Gavin Tighe and Robert Winterstein, for the respondent

Keywords: Contracts, Solicitor and Client, Torts, Solicitor’s Negligence, Costs

Facts:

The appellant, GK, a lawyer, appeals from the order granting summary judgment dismissing his counterclaim against the respondent, Lang Michener LLP.

In 2007, Mr. K retained Lang Michener to defend him in proceedings commenced by the trustee of a bankrupt Italian company, Sincies Chiementin SpA (“Sincies”), to enforce a judgment issued by an Italian court on October 1, 2001 against Mr. K (the “Italian Judgment”). The amount of the Italian Judgment was US$600,000, plus interest, currency appreciation and costs. Following a four day hearing, Whalen J. granted the trustee summary judgment recognizing and enforcing the Italian Judgment (the “Enforcement Judgment”): 2010 ONSC 6453.

The Court of Appeal dismissed Mr. K’s appeal from the Enforcement Judgment: 2012 ONCA 653. Mr. K’s request for leave to appeal to the Supreme Court of Canada was denied: [2012] S.C.C.A. No. 516.

In March 2011, Lang Michener commenced an action against Mr. K seeking payment of its fees for services rendered in the enforcement proceeding. Mr. K counter-claimed and sought judgment against Lang Michener in the amount he owed under the Italian Judgment, together with all legal fees and other costs he had incurred in defending the trustee’s enforcement and recognition claim. The motion judge granted summary judgment dismissing Mr. K’s counterclaim. Mr. K appealed.

Mr. K limits his appeal to the motion judge’s dismissal of the part of his counterclaim alleging negligent advice given by Lang Michener in 2008 in respect of a possible claim against LawPro. Mr. K also seeks leave to appeal the motion judge’s award of costs of $45,000 against him.

Issues:

(1) Did the motion judge err in dismissing the appellant’s counterclaim alleging negligent advice given by Lang Michener?

(2) Did the motion judge err in awarding costs of $45,000 against the appellant?

Holding: Appeal dismissed.

Reasoning:

(1) No. The motion judge made no error in finding the Italian court had specifically declined to take jurisdiction over Mr. K in relation to allegations of professional liability. That finding was firmly anchored in the reasons of the Italian court.

Coverage under the Policy was only available for liability resulting from an error, omission or negligent act “in the performance of or the failure to perform PROFESSIONAL SERVICES for others.” The Italian Judgment was clear that Mr. K’s liability was not in respect of professional services he had rendered. Accordingly, the court saw no error in the motion judge’s conclusion, at para. 52 of his reasons, that “regardless of the advice that was given by Kelly, [Mr.] K has suffered no damages: he would have lost an action against LawPro, and so his failure to start such a lawsuit after LawPro denied coverage in November 1997 has cost him nothing.”

(2) No. Leave to appeal costs was granted, but the costs awarded were reasonable and therefore the court did not interfere.

Correct Building Corporation v. Lehman, 2018 ONCA 462

[Pepall, Trotter and Paciocco JJ.A.]

Counsel:

R. Krupnyk, for the appellants/respondents by way of cross-appeal

R. J. Horst and R. Szymanski, for the respondents/appellants by way of cross-appeal R. S. and Indicom Appraisal Associates Ltd.

A. Formosa and F. Bogach, for J. L., Jon Babulic, R. Forward, J. Foster, C. Magwood, E. Archer, D. McKinnon, J. Robinson, A. Nuttal, J. Moore, and M. Prowse

Keywords: Torts, Negligent Misrepresentation, Fraudulent Misrepresentation, Conspiracy, Negligence, Inducing Breach of Contract, Wrongful Interference with Economic Relations, Summary Judgment

Facts:

The appellant was negotiating with the City of Barrie and the YMCA to finalize an agreement of purchase and sale of a property. The City requested a quotation from Indicom, the respondent, to assist the City in negotiations for the potential sale of the property.

The respondents provided the City with an appraisal wherein they warned that a change in assumptions might change the stated value. The appraisal also contained limitations on use and certain limiting conditions. The respondents noted that no environmental factors affecting the property had been considered.  The respondents cautioned that if placing reliance on the report, an expert qualified in environmental issues should be retained.  In addition, the respondents noted in the report that an archeological survey had not been completed.

The appellant saw the appraisal and thought it contained a major flaw and offered to purchase the property for an amount less than the appraisal amount. The City rejected this offer. The appellant then brought an action stating that it continued pointless negotiations with the City in reliance on the respondent’s appraisal. On a summary judgment motion, the appellant’s claim for negligent and fraudulent misrepresentation and conspiracy were dismissed. The judge ordered a mini-trial on whether the limitation period for a claim of negligence, inducing breach of contract, and wrongful interference with economic relations had expired. Both sides appealed.

Issues:

(1) Did the motion judge err in dismissing the claims for misrepresentation?

(2) Did the motion judge err in ordering a mini-trial on whether the limitation period for a claim of negligence, inducing breach of contract, and wrongful interference with economic relations had expired?

Holding:

Appeal dismissed. Cross-appeal allowed.

Reasoning:

(1) No. The appellants did not rely on the appraisal nor did the appraiser expect anyone other than the City to rely on the appraisal.

(2) Yes. The issues identified for the mini-trial would have changed nothing. The limitation period commenced on August 26, 2010, when the appellant wrote to the City complaining about the appraisal. The motion judge found there was no reliance, evidence of any purpose or intention to injure the appellant and no evidence of unlawful conduct by the respondents. Therefore the claims for inducing breach of contract and wrongful interference with economic relations have no possibility of success. Those claims were therefore dismissed as well.

Short Civil Decisions

Di Battista Gambin Developments Limited v. Brampton (City), 2018 ONCA 457

[Rouleau, Roberts and Fairburn JJ.A.]

Counsel:

Robert D. Malen, for the appellant

Signe Leisk and Melissa Winch, for the respondent

Keywords: Real Estate, Application, Interpretation of Subdivision Agreement, Transfer, Land Parcels

Mori Essex Nurseries Inc. v. Northbridge General Insurance Corporation, 2018 ONCA 452

[Rouleau, Roberts and Fairburn JJ.A.]

Counsel:

Anne Juntunen, for the appellants

William Chalmers, for the respondents

Keywords: Insurance Coverage, Commercial General Liability Policy, Care and Custody Exclusion

Apotex Inc. v. Abbott Laboratories Limited, 2018 ONCA 466

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

Counsel:

Steven G. Mason and David A. Tait for the appellant Abbott Laboratories Ltd.

Christopher C. Van Barr and Kiernan Murphy for the appellant

Takeda parties Andrew R. Brodkin and Michael A. Wilson for the respondent

Keywords: Civil Procedure, Costs, Partial Indemnity

Gulf Developments Inc. v. Essex (Town), 2018 ONCA 465

[Lauwers, Benotto and Nordheimer JJ.A.]

Counsel:

James K. Ball, for the appellant

Rodney M. Godard and Ioana Vacaru, for the respondents

Keywords: Contracts, Construction, Tendering, Bid Shopping, Martel Building Ltd. v. Canada, 2000 SCC 60, [2000] 2 S.C.R. 860, R. (Ont.) v. Ron Engineering, [1981] 1 S.C.R. 111

Design Filtration Microzone Inc. v. Cunningham, 2018 ONCA 468

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

Counsel:

Nigel McCready, for the appellant Bruce Sevigny, for the respondent

Keywords: Employment Law, Wrongful Dimissal, Notice Period, Paquette v. TeraGo Networks Inc., 2016 ONCA 618

Criminal and Regulatory Offences

Ontario (Ministry of the Environment and Climate Change) v. Sunrise Propane Energy Group Inc., 2018 ONCA 461

[Trotter J.A. (Motions Judge)]

Counsel:

Leo Adler, for the applicants

Nicholas Adamson and Justin Jacob, for the respondent

Keywords: Environmental Law, Leave to Appeal, Section 186(1), Section 186(2), Section 194(2), Environmental Protection Act, R.S.O. 1990, c. E.19, Section 25(2)(a) and (h), Occupational Health and Safety Act, R.S.O. 1990, c. O.1, section 131, Provincial Offences Act, R.S.O. 1990

Facts:

On August 10, 2008, a series of explosions rocked the north end of Toronto. They occurred at a propane gas facility operated by Sunrise Propane Energy Group Inc. (“Sunrise”) during a “truck-to-truck transfer” (“TTT”) where a large propane truck was transferring propane to a smaller truck. The spread of heat caused other propane tanks at the facility to explode. This resulted in numerous contaminants being discharged into the environment including heat, vibration, sound, gas vapour, asbestos, smoke, dust, metal fragments, and other debris. It forced the immediate evacuation of approximately 12,000 people from their homes while the fire persisted at the facility. Displaced residents suffered lost wages and had to pay for temporary shelter and clothing. The explosions caused major structural damages to homes and businesses in the area. There was one death and others were injured.

The applicants, Sunrise Propane Energy Group Inc., 1367229 Ontario Inc., Shay Ben-Moshe and Valery Belahov, were charged under ss. 186(1), 186(2), and 194(2) of the Environmental Protection Act, R.S.O. 1990, c. E.19 (“EPA”) for discharging contaminants into the environment (in violation of s. 14) and failing to comply with lawful orders issued to address the clean-up. They were also charged under ss. 25(2)(a) and (h) of the Occupational Health and Safety Act, R.S.O. 1990, c. O.1 (“OHSA”) for failing to properly train and ensure the safety of its employees.

After a 14-day trial, the applicants were convicted of nine provincial offences. They were collectively ordered to pay fines totalling $5.3 million. Appeals of both the convictions and sentences were dismissed.

The applicants sought to invoke the jurisdiction of the Court of Appeal to review their convictions and sentences. However, they were first required to seek leave to appeal.

Issues:

(1) Should the court grant the applicant’s leave to appeal?

Holding: Appeal dismissed.

Reasoning:

(1) No. The court stated that leave to appeal to the Court of Appeal in the provincial offences context is only permitted on questions of law that are essential in the public interest or for the due administration of justice in the province.

The applicants already had a full appeal to the Superior Court of Justice and a further appeal to this court is not automatic. The court stated that leave to appeal is required under s. 131 of the Provincial Offences Act, R.S.O. 1990, c. P.33 (“POA”), which sets the bar very high and has been granted sparingly.

The applicants proposed two grounds of appeal. The first ground relates to the defence of officially induced error.

Well before the incident, Donald Heyworth, a TSSA inspector, attended at Sunrise on a couple of compliance visits. He ordered Sunrise to comply with the Director’s Public Safety Order prohibiting TTTs, except at a licensed “bulk plant.” Discussions were held about upgrading the Sunrise facility to permit TTTs. As he was leaving Sunrise one day, someone asked Mr. Heyworth, “Can we continue operating?” He replied, “Yes.” At trial he explained that he meant that Sunrise could continue to transfer propane from trucks to stationary tanks, and then fill cylinders from those tanks.

In June 2007, the TSSA issued a Code Adoption Document, which was posted to its website on June 14, 2007. The Document prohibited TTTs unless the facility was a bulk plant. There was no evidence of anyone purporting to give the applicants an exemption from the requirements set out in this Document.

The trial judge found that the applicants could rely on an officially induced error, but only up to the date where the code adoption document was issued in June of 2007 which prohibited the truck-to-truck transfers.

The appeal judge found no error in the trial judge’s application of this doctrine and the court of appeal also found no error.

The applicants’ second ground of appeal related to the enforcement of the Order issued in the aftermath of the explosions. The court held that this ground of appeal turned on whether the trial judge properly interpreted the Order. However, this was a question of mixed fact and law, not one of law alone. Even if it was construed as an error of law, it had not been demonstrated that the interpretation of the administrative/enforcement Order issued in this case was essential in the public interest or for the due administration of justice in the province.

R v Al Ubeidi, 2018 ONCA 463

[MacFarland, Watt and Paciocco JJ.A.]

Counsel:

Howard Piafsky, for the appellant

Evan Weber, for the respondent

Keywords: Criminal, Evidence Constructive Possession, Circumstantial Evidence, Error of Law

R v Hungwe, 2018 ONCA 456

[LaForme, Watt and Nordheimer JJ.A]

Counsel:

Michael Davies and Meaghan McMahon, for the appellant, Dennis Hungwe

Anthony J. Does, for the appellant, Christian Nkusi

Howard L. Krongold, for the appellant, Moussa Daoui

John Hale, for the appellant, Richard Issachar Ellis

Jonathan Dawe, for the appellant, Geovanni Nicholas Ellis

Andreea Baiasu, for the respondent

Keywords: Criminal Procedure, Robbery, Jury Charge, Questioning Witnesses, Prior Consistent Statement’

R v SC, 2018 ONCA 454

[Rouleau, Tulloch and Fairburn JJ.A]

Counsel:

R. C., acting in person

Julianna Greenspan, appearing as duty counsel

Deborah Krick, for the respondent

Keywords: Publication Ban, Evidence, Sexual Assault, Similar Fact Evidence

R v Higgins, 2018 ONCA 451

[Feldman, Roberts and Trotter JJ.A.]

Counsel:

Melissa Adams, for the appellant

Mark Halfyard, for the respondent

Keywords: Criminal, Dangerous Driving Causing Bodily Harm, Mens Rea, s. 249(1) of the Criminal Code

R v Notaro, 2018 ONCA 449

[Feldman, Paciocco and Fairburn JJ.A.]

Counsel:

Peter Lindsay, for the appellant

Kevin Rawluk, for the respondent

Keywords: Criminal, Accuracy of Blood Alcohol Breath Test, Residual Alcohol in Mouth

R v Vorobiov, 2018 ONCA 448

[Laskin and Pepall JJ.A. and Gans J.]

Counsel:

Scott Hutchison and Apple Newton-Smith, for the appellant

Eric Siebenmorgan and Rachel Young, for the respondent

Keywords: Criminal, Murder Plot, Evidence, Cross-Examination, Browne v. Dunn Instruction, Conduct After Murder

R v Dawson, 2018 ONCA 458

[MacFarland, Watt and Paciocco JJ.A.]

Counsel:

Breana Vandebeek, for the appellant

Craig Harper, for the respondent

Keywords: Criminal, Drug and Weapon Possession, Judicial Notice, Exculpatory Statement

R v Groskopf, 2018 ONCA 455

[Brown J.A.]

Counsel:

Dano Sahulka and Efstathios Balopoulos, for the applicant

Susan Magotiaux, for the respondent

Keywords: Criminal, Sexual Assault and Exploitation, Public Interest, Criminal Code, s. 679(3)(c)

R v Jackson, 2018 ONCA 460

[Doherty, Epstein and Pepall JJ.A.]

Counsel:

Rebecca De Filippis, for the appellant

Ian Carter, for the respondent

Keywords: Criminal Law, Impaired Driving, Summary Conviction, Standard of Review, Criminal Code, s. 253(1)(a)

R v Lawrence, 2018 ONCA 464

[Doherty, Epstein and Pepall JJ.A.]

Counsel:

Ian Carter, for the appellant

Rebecca De Filippis, for the respondent

Keywords: Criminal Law, Aggravated Assault

R v CL, 2018 ONCA 470

[Trotter J.A.]

Counsel:

David J. D’Intino, for the applicant

Susan Magotiaux, for the respondent

Keywords: Criminal Law, Sexual Assault, Bail, Public Interest

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ONTARIO COURT OF APPEAL SUMMARIES (MAY 7- MAY 11)

Good afternoon,

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

The most significant decision of the week was easily Mega International Commercial Bank (Canada). In that case, the Court confirmed that the limitation period to bring claims for contribution and indemnity are not hard-capped at two years from the date a defendant was served with the plaintiff’s claim. Rather, section 18 of the Limitations Act, 2002 only creates a rebuttable presumption. The discoverability test set out in section 5 still applies, and if met, can extend the limitation period for bringing claims for contribution and indemnity.

Other topics covered this week included another decision in the residential schools class action, damages for breach of a fixed term personal services contract, breach of a non-solicitation covenant, an unpleasant dispute between neighbours, medical negligence, coverage for a mortgagor under a property insurance policy taken out by a mortgagee, a claim for damage to cargo under a marine insurance policy, leave to appeal and extension of time to appeal.

Wishing all the mothers a Happy Mother’s Day!

John Polyzogopoulos

Blaney McMurtry LLP

jpolyzogopoulos@blaney.com

Tel: 416 593 2953

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

Table of Contents

Fontaine v. Canada (Attorney General), 2018 ONCA 421

Keywords: Civil Procedure, Class Actions, Jurisdiction, Mootness, Standing, Deemed Undertaking, Evidence, Privilege, Rules of Civil Procedure, Rules 30.1.01 and 31.11(8)

Mohamed v. Information Systems Architects Inc., 2018 ONCA 428

Keywords: Contracts, Personal Services, Interpretation, Standard of Review, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Termination, Duty of Good Faith Performance, Damages, Mitigation, Howard v. Benson Group Inc. (The Benson Group Inc.), 2016 ONCA 256

Mega International Commercial Bank (Canada) v. Yung, 2018 ONCA 429

Keywords: Torts, Solicitors’ Negligence, Contracts, Guarantees, Civil Procedure, Limitation Periods, Contribution and Indemnity, Discoverability, “Appropriate Means”, Fraudulent Concealment, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, s. 18

Kalair v. Central 1 Credit Union, 2018 ONCA 434

Keywords: Civil Procedure, Appeals, Extension of Time, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 7(5), Standard of Review, Deference, R. v. Gatfield, 2016 ONCA 23

MD Physician Services Inc. v. Wisniewski, 2018 ONCA 440

Keywords: Contracts, Employment, Restrictive Covenants, Non-Solicitation, Enforceability, Ambiguity, Elsley Estate v. J.G. Collins Agencies Ltd.,  [1978] 2 S.C.R 916

Robert v. Assis, 2018 ONCA 442

Keywords: Torts, Trespass, Intrusion Upon Seclusion, Nuisance, Abuse of Process, Reasonable Apprehension of Bias, Fresh Evidence

Crump v. Fiture, 2018 ONCA 439

Keywords: Torts, Medical Negligence, Standard of Care, Causation, Reasons for Decision

Rill v. Adams, 2018 ONCA 443

Keywords: Civil Procedure, Leave to Appeal, Torts, Medical Negligence, Standard of Care

Hanson v. Totten Insurance Group Inc., 2018 ONCA 446

Keywords: Real Property, Contracts, Mortgages, Property Insurance, Coverage, Named Insureds, Insurable Interest, Subrogation

Broadgrain Commodities Inc. v. Continental Casualty Company (CNA Canada), 2018 ONCA 438

Keywords: Contracts, Insurance, Shipping, Summary Judgment, Evidence, Guarantee Co. of North America v. Gordon Capital Corp., [1999] 3 S.C.R. 423

For short civil decisions click here

For criminal decisions click here

Civil Decisions

Fontaine v. Canada (Attorney General), 2018 ONCA 421

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

Counsel:

Margaret L. Waddell and Fay K. Brunning, for the appellants Claimant H15019, Claimant K-10106 and M.

Catherine A. Coughlan and Brent Thompson, for the respondent Attorney General of Canada

Peter C. Wardle, for the intervenor

Diane Soroka, David Schulze and Maryse Décarie-Daigneault, for the Independent Counsel

Keywords: Civil Procedure, Class Actions, Jurisdiction, Mootness, Standing, Deemed Undertaking, Evidence, Privilege, Rules of Civil Procedure, Rules 30.1.01 and 31.11(8)

Facts: These appeals arise out of the implementation of the Indian Residential Schools Settlement Agreement (2006) (the “IRSSA”). The IRSSA is a settlement agreement that resolved class actions and pending individual actions across Canada against the Attorney General of Canada and other parties implicated in the tragic history of abuse perpetrated on indigenous children at residential schools. Among other things, the IRSSA provides for financial compensation to these victims. All eligible class members who had resided in a residential school are entitled to payment of a minimum amount, called a “Common Experience Payment”. The IRSSA also provides that class members who allege they suffered serious physical, sexual or psychological harm at a residential school may apply for additional compensation through the Independent Assessment Process (“IAP”).

This appeal involves St. Anne’s Indian Residential School in Fort Albany, Ontario. The appellants sought a declaration that Canada had breached its disclosure obligations under the IRSSA by refusing to produce transcripts of examinations for discovery from a related action (the Cochrane action). The administrative judge dismissed H-15019’s Request for Directions (“RFD”). He concluded that Canada had not breached its disclosure obligations under the IRSSA by refusing to produce the Cochrane Transcripts.

K-10106 and M sought extensive, far-reaching relief in their RFD. The administrative judge considered two preliminary issues: did they satisfy the test to obtain legal standing to bring their RFD and, if so, did the court have jurisdiction to provide the broad relief requested? The administrative judge concluded that K-10106 and M did not satisfy the test to obtain standing, the court did not have jurisdiction to grant most of the relief they sought, and, of the remaining items, there was no good reason for the court to exercise its jurisdiction. The appellants appeal the orders dismissing their RFDs.

Issues:

(1) Is H-15019’s appeal moot, and, if so, should the court exercise its discretion to hear his appeal?

(2) Does the deemed undertaking rule apply to the Cochrane transcripts?

(3) Was the administrative judge’s interpretation of the Order and the IRSSA unreasonable?

(4) Did the administrative judge err by failing to lift the deemed undertaking?

(5) Are the Cochrane Transcripts protected by settlement privilege?

(6) Did the administrative judge err in finding K-10106 and M did not have standing?

Held: Appeal dismissed.

Reasoning:

(1) Yes, the appeal is moot, but should still be heard by the court. Further disclosure could not impact him, because he has already been awarded the highest amount available, but the circumstances warrant the court hearing H15019’s appeal. Unquestionably, an adversarial relationship continues to prevail between the appellants and Canada. All appear, represented by counsel. Further, judicial economy favours determining these issues.

(2) No. The discovery evidence at issue was obtained in 62 distinct civil actions instituted in Cochrane by 154 survivors of St. Anne’s. H-15019 was not a plaintiff in any of the Cochrane Actions. He argues that the evidence of a survivor obtained in a civil proceeding commenced by that survivor can be used for the purpose of an IAP of a different survivor because they are the same proceeding. They are clearly not the same proceeding, and they involve different claimants. Rule 31.11(8) is inapplicable. Most of the Cochrane Actions settled before the advent of the IRSSA. No other actions could be or were subsequently brought in relation to the subject-matter of those settled actions.

(3) No. The interpretation of the IRSSA is a question of mixed fact and law reviewable for palpable and overriding error. There is no basis to interfere with the administrative judge’s conclusions that Canada did not breach its disclosure obligations in refusing to produce the Cochrane Transcripts. The deemed undertaking rule was not displaced by the IRSSA or the Applications Judge’s Order.

(4) No. While the administrative judge did not specifically address this argument in the reasons that are the subject of this appeal, he rejected it in an earlier decision regarding the disposition of documents created within the IAP. The administrative judge was entitled to consider the fact that considerable information was already available to Claimant H-15019 in determining whether the interests of justice outweighed the prejudice to the examinees of setting aside the deemed undertaking and providing further disclosure to him. His assessment of the interests of justice was not infected by a palpable and overriding error.

(5) No. The administrative judge agreed with Canada that the Cochrane Transcripts were covered by settlement privilege and disagreed with Claimant H-15019 that Canada had not met the evidentiary burden of showing that the discoveries were communications made with a view to settlement. Given the findings above, it was not necessary to determine whether there was an adequate basis for the administrative judge’s finding.

(6) Yes. Given the broad scope of their RFD, the administrative judge’s standing analysis was tainted by his focus on their complaints regarding the lawyers. The Court would have granted K-10106 and possibly M standing. However, this point is irrelevant, as there is no basis to interfere with the administrative judge’s conclusion that the court does not have, or should not exercise, its jurisdiction to order the broad entitlement to re-hearings that K-10106 and M seek, or to order a re-hearing of K-10106’s claim. There is also no basis to interfere with the administrative judge’s conclusion that the court should not exercise its case-by-case jurisdiction in the case of K-10106.

Mohamed v. Information Systems Architects Inc., 2018 ONCA 428

[Feldman, Watt, Paciocco JJ.A.]

Counsel:

J A LeNoury and R MacKinnon, for the appellant

L Sabsay, for the respondent

Keywords: Contracts, Personal Services, Interpretation, Standard of Review, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Termination, Duty of Good Faith Performance, Damages, Mitigation, Howard v. Benson Group Inc. (The Benson Group Inc.), 2016 ONCA 256

Facts:

The appellant engaged the respondent to provide technological consulting services under an Independent Consulting Agreement (“ICA”) for a six-month project that had an anticipated start date of November 2, 2015, and an anticipated end date of May 31, 2016. In the ICA, the parties agreed that the respondent would be an independent contractor. The project was with Canadian Tire, whose agreement with the appellant included a term that the appellant would not send any consultant who had a criminal record, except with Canadian Tire’s consent. After agreeing to work full-time under the ICA, the respondent resigned from his permanent, full-time employment.

Around November 2, 2015, the respondent told the appellant – before he signed the ICA and before he was assigned to the Canadian Tire project – that he had a dated criminal record from high school. He also agreed to a background security check. On November 4, he again disclosed his criminal record to the appellant in a declaration of criminal record form. On November 5, he began work at Canadian Tire, but when the security check report came back one month later disclosing the criminal record, Canadian Tire received a copy and, as a result, asked the appellant to replace the respondent. Although the respondent asked the appellant to consider him for other roles, the appellant terminated the respondent’s engagement on December 10, 2015, relying on para. 11.III of the ICA.

The respondent sued the appellant for breach of the ICA, claiming six months’ remuneration, that is, the full amount that would have been paid had the contract been completed, on the basis that the ICA was a fixed term contract where the respondent had no duty to mitigate his damages. Both parties moved for summary judgment, where the respondent asked the court to award damages for breach of contract, and the appellant asked the court to dismiss the action. Neither side took the position that a trial of any issue was required. The motion judge awarded judgment to the respondent in the full amount.

Issues:

(1) Did the motion judge make extricable errors of law in his approach to the interpretation of the termination clause of the ICA?

(2) Did the motion judge err in finding that the appellant was entitled to terminate the ICA under para. 11.III but that it did not do so in good faith?

(3) Did the motion judge err in law in finding that the ICA was a fixed term contract, and by applying the principle from the court’s decision in Howard v. Benson that the measure of the respondent’s damages is the amount owing for the unexpired term of the contract with no duty to mitigate?

Holding: Appeal dismissed.

Reasoning:

(1) Yes. Because the issue before the court was the interpretation and enforcement of a non-standard form contract between the parties, on appeal, the principles articulated by the Supreme Court of Canada in Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 SCR 633 apply. As a result, significant deference is owed to the trier of fact on the findings regarding the interpretation of the particular contract.

At para. 39 of his reasons, the motion judge specifically identified the principle of good faith as “an operative principle in the performance of contracts” – not a principle applicable to the interpretation of contracts. Applying the principle of good faith to the performance of the termination provision, he concluded at paras. 39-40 that the principle “qualifies ISA’s rights to terminate without cause”, such that the appellant could not “simply, and in an unfettered way, determine that it is in their best interest to replace Mr. Mohamed and then terminate the contract”. He added at para. 42 that the appellant was “mistaken in thinking that it had an unfettered right to terminate Mr. Mohamed’s contract” because the case law supported the respondent’s understanding that “there was some element of good faith or trust in the exercise of the provision”. The motion judge then went on to find that the appellant breached the ICA by not acting in good faith when it exercised its rights under the termination provision.

Having made the finding of breach, the motion judge nevertheless went on to find, essentially in the alternative, that the termination clause was void for vagueness. The motion judge made two extricable errors of law in the application of the principles of contractual interpretation in reaching this conclusion.  First, having found that the meaning of the termination provision was clear when read literally, there was no basis to apply the contra proferentem rule. That rule may be used only to resolve an ambiguity (see: Consolidated-Bathurst v. Mutual Boiler, [1980] 1 S.C.R. 888, at pp. 899-900), not to create one.  Second, having found the meaning of the termination clause to be clear, the subsequent conclusion that the clause is vague and uncertain because of the differing notice requirements is inconsistent, and does not bear logical scrutiny. The motion judge identified no basis on the record for concluding that it was not the intention of the parties to require notice of termination only where the respondent’s engagement was being terminated for breach of the ICA, or that the clause could not be implemented as it reads. The result of finding two extricable errors of law in the motion judge’s finding that the termination clause is unenforceable is that the finding cannot stand and must be set aside. However, nothing ultimately turns on this conclusion, because of the motion judge’s other finding that the appellant was obliged to exercise its rights under para. 11.III of the ICA in good faith and that it breached the agreement by failing to do so.

(2) No. Although the appellant had a prima facie unfettered right to terminate the contract, it had an obligation to perform the contract in good faith and therefore to exercise its right to terminate the contract only in good faith. Although the motion judge did not state explicitly the basis for concluding that the appellant breached its good faith obligation, he had reviewed the facts and circumstances earlier in his reasons. Because the respondent disclosed his criminal record to the appellant right at the beginning, before signing the ICA and before commencing the project with Canadian Tire, and complied with all the requirements of the security check, the appellant’s reliance on the criminal record to terminate the contract one month later was not a good faith exercise of its rights under the termination clause of the ICA.

(3) No. Although he was willing to accept that his engagement could be terminated with no payment when the appellant deemed it to be in its best interests to do so, the respondent expected, as he was entitled to do, that the appellant would only exercise its rights under the termination clause in good faith. When that did not occur, the respondent was entitled to damages. Although the contract does not provide for what damages would flow from a failure to terminate in good faith, based on the specific terms and circumstances of this contract, it is reasonable to infer that the parties intended that if the power to terminate was not exercised in good faith, then damages for breach would be based on the wages owed for the remaining term of the agreement, without a duty to mitigate.

Mega International Commercial Bank (Canada) v. Yung, 2018 ONCA 429

[Doherty, Paciocco and Nordheimer JJ.A.]

Counsel:

Eliot N. Kolers and Zev Smith, for the appellant

M Scott Martin and Marco P. Falco, for the respondents

Keywords: Torts, Solicitors’ Negligence, Contracts, Guarantees, Civil Procedure, Limitation Periods, Contribution and Indemnity, Discoverability, “Appropriate Means”, Fraudulent Concealment, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, s. 18

Facts:

This is an appeal from summary judgment dismissing the appellants’ third party claims for contribution and indemnity against the respondent lawyer and law firm as statute-barred.

Mr. Y and Ms. L, the appellants, commenced the underlying third party claims against their former lawyer, Mr. S and his law firm, Sun & Partners, after Mega International Commercial Bank (Canada) (“Mega International”) sued Mr. Y and Ms. L on personal guarantees they provided to Mega International’s predecessor, International Commercial Bank of Cathay (Canada) (“International Commercial”). Those personal guarantees were given to secure financing for a Toronto development property that Mr. Y and Ms. L were involved in. Mr. Y and Ms. L claim that their lawyer, Mr. S, was instructed to obtain releases from those personal guarantees, but failed to do so – hence their claims for contribution and indemnity.

Mr. Y and Ms. L did not sue Mr. S and his law firm until more than two years after Mega International served Ms. L with a claim against her on her personal guarantee. The motion judge held that s. 18 of the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B establishes an absolute two-year limitation period for contribution and indemnity claims, which commenced when Ms. L was served with Mega International’s claim. Hence, he found that Mr. Y’s and Ms. L’s third party claims were statute-barred.

Issues:

(1) Does s. 18 of the Limitations Act, 2002 incorporate discoverability principles?

(2) If the discoverability principles under ss. 4 and 5 of the Limitations Act, 2002 apply, should the motion judge’s findings relating to Mr. Y’s and Ms. L’s knowledge of their claims against Mr. S, made in the context of the fraudulent concealment determination, be relied upon to resolve the discoverability issue?

Holding: Appeal allowed.

Reasoning:

(1) Yes. The court held that the motion judge erred in law in holding that the Limitations Act, 2002, s. 18 creates an absolute limitation period of two years for the commencement of contribution and indemnity claims. Properly interpreted, s. 18 works with other provisions of the Limitations Act, 2002 to create a presumed start date for the running of the limitation period. That presumed limitation period start date will result in a claim for contribution or indemnity being statute-barred two years after the party seeking contribution or indemnity is served with a claim in the proceeding in which contribution or indemnity is sought, unless that party proves that the claim for contribution or indemnity was not discovered and was not capable of being discovered through the exercise of due diligence until some later date.

Section 18 of the Limitations Act, 2002, the section directly in issue in this appeal, provides:

Contribution and indemnity

18(1) For the purposes of subsection 5(2) and section 15, in the case of a claim by one alleged wrongdoer against another for contribution and indemnity, the day on which the first alleged wrongdoer was served with the claim in respect of which contribution and indemnity is sought shall be deemed to be the day the act or omission on which that alleged wrongdoer’s claim is based took place.

The court stated that s. 18 takes on meaning when it is linked to the Limitations Act, 2002, s. 5(2). Subject to the absolute 15-year limitation period in s. 15(2), ss. 5(2) and 18 together establish the presumptive limitation period for contribution and indemnity claims – a presumptive limitation period that incorporates the discoverability principles outlined in ss. 4 and 5(1). The court emphasized the interaction between ss. 5(2) and 18 for two reasons.

First, s. 18 is linked expressly to s. 5(2) in its opening phrase, “For the purposes of subsection 5(2) and section 15”. This opening phrase cannot be read as a direction to exclude contribution and indemnity claims from the operation of ss. 5(2) and 15.

Second, the thing or fact that s.18 deems to have occurred is the same thing or fact that is used in s. 5(2) as the trigger for the presumptive limitation period in ss. 4 and 5. Section 18 deems “the day on which the first alleged wrongdoer was served with the claim in respect of which contribution or indemnity is sought [to be] the day the act or omission on which the alleged wrongdoer’s claim is based took place.” Meanwhile, s. 5(2) treats “the day the act or omission on which the claim is based took place” to be the day on which a person with a claim is presumed to know that they have a claim within the meaning of s. 5(1). Section 5(2) is the only other provision in the Limitations Act, 2002 apart from s. 18 that uses the operative phrase underlined in the preceding sentences. The two sections are clearly meant to intersect and work together. In effect, s. 18 provides the variable used in s. 5(2) as the trigger for the presumed limitation period for contribution and indemnity claims.

The court therefore held that the motion judge erred in his interpretation of s. 18. The two-year limitation period prescribed by ss. 4, 5(2), and 18 for contribution and indemnity claims presumptively begins on the date of service of a claim in respect of which contribution and indemnity is sought. That presumptive limitation period start date, however, can be rebutted by the discoverability principles prescribed in s. 5 of the Limitations Act, 2002.

(2) No.  In law, fraudulent concealment differs from discoverability in its focus and its requirements. The court stated that the motion judge nonetheless made a finding while addressing the fraudulent concealment claim that Mr. S relies on as resolving the discoverability issue in his favour. Specifically, the motion judge found, at para. 57 of his reasons, that there was no fraudulent concealment because Mr. Y and Ms. L were “aware of the essential facts giving rise to a claim against the alleged wrongdoer”, Mr. S.

The court held that the finding that Mr. Y and Ms. L were aware of the essential facts giving rise to a claim against Mr. S is not a finding of discoverability within the meaning of the Limitations Act, 2002, s. 5(1). The court cannot, therefore, utilize this holding to dismiss this appeal on the basis that the motion judge resolved the discoverability issue indirectly.

The reason the motion judge’s “knowledge” finding is not the same as a discoverability finding is because the knowledge finding does not resolve the discoverability consideration in s. 5(1)(a)(iv) of the Limitations Act, 2002 with respect to whether the party with the claim knew that bringing the claim was legally appropriate (the “appropriate means” branch of the discoverability test).

It would not be appropriate in these circumstances to treat a finding that the defendants had knowledge of the main action as a finding that a third party claim against their lawyer was discoverable. The motion judge did not overtly address whether Mr. Y or Ms. L knew it to be legally appropriate to bring their third party claims against Mr. S. In the court’s view, this was enough to dispose of the appeal.

The court stated that the decision of the motion judge to grant summary judgment was undermined by his misinterpretation of the Limitations Act, 2002, s. 18. Simply put, that error clouded the motion judge’s understanding of the nature and complexity of the case he was being asked to resolve on summary judgment. Had he appreciated the nature of the dispute before him, i.e., when Mr. Y and Ms. L discovered that it was legally appropriate to commence a third party claim against their own lawyer, he may have found a genuine issue requiring a trial.    

Kalair v. Central 1 Credit Union, 2018 ONCA 434

[LaForme, Watt and Nordheimer JJ.A.]

Counsel:

KEW, for the moving party

DS and AF, for the responding party

Keywords: Civil Procedure, Appeals, Extension of Time, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 7(5), Standard of Review, Deference, R. v. Gatfield, 2016 ONCA 23

Facts:

Mr. K’s motion for an extension of time to file a notice of appeal – which he had missed by 2 weeks – was dismissed by Roberts J.A. on October 11, 2017. Justice Roberts was satisfied that Mr. K had formed the requisite intention to appeal, provided an adequate explanation for the short delay, and there was no prejudice occasioned to the respondent from the delay. However, she concluded that Mr. K had failed to meet “the admittedly low threshold of demonstrating that there was some merit to the proposed appeal such that the court should not reasonably deny the important right of appeal”.

Pursuant to s. 7(5) of the Courts of Justice Act, R.S.O. 1990, c. C.43, Mr. K moved before a panel to review the decision of Roberts J.A. and to set aside her order or vary it. As additional support for this review, and by way of an affidavit dated April 26, 2018 contained in a supplementary motion record filed April 27, 2018, Mr. K outlines proposed merits of the appeal that were not before Roberts J.A.

Issues:

(1) Did the motion judge err in dismissing the appellant’s motion for an extension of time to file a notice of appeal?

Holding: Appeal dismissed.

Reasoning: 

(1) No. In Mr. K’s April 26th affidavit he provides particulars of “merits of the appeal that were not before Roberts J.A.”. In the affidavit he claims that “much of the legal merits of [his] appeal were not known to [him] and [his] new counsel until more recently when [his] previous counsel provided information and parts of the file”.

A full panel of the court owes considerable deference to a chambers judge’s decision regarding whether to grant an extension of time: R. v. Gatfield, 2016 ONCA 23, at para. 11.

The conclusory statements in the affidavit before Roberts J.A. do not support the argument that she may have made an error in dismissing Mr. K’s motion. To the contrary, Roberts J.A. addressed all the relevant factors and properly applied those factors to the evidentiary record before her. In particular, she concluded there was no merit to the appeal. The panel agreed with that conclusion. Mr. K failed to provide any reason (even in his new material) for why the panel should interfere with the exercise of discretion by Roberts J.A.

MD Physician Services Inc. v. Wisniewski, 2018 ONCA 440

[MacPherson, Hourigan and Benotto JJ.A.]

Counsel:

Nigel Campbell and Doug McLeod, for RBC Dominion Securities Inc.

Kenneth Dekker and Annie Tayyab, for the respondents

Keywords: Contracts, Employment, Restrictive Covenants, Non-Solicitation, Enforceability, Ambiguity, Elsley Estate v. J.G. Collins Agencies Ltd.,  [1978] 2 S.C.R 916

Facts:

The appellants are two former employees of the respondent companies (“MD”). They, together with their current employer, the respondent RBC Dominion Securities Inc. (“RBC”), appeal from the trial judge’s finding that they breached the non-solicitation terms of their employment contract with MD.

The appellants were hired by MD in 2003 and 2005 respectively. They each signed identical non-solicitation agreements which provided as follows:

Non-Solicitation. The Employee agrees that the Employee shall not solicit during the Employee’s employment with the Employer and for the period ending two (2) years after the termination of his/her employment, regardless of how that termination should occur, within the geographic area within which s/he provided services to the Employer.

“Solicit” means: to solicit, or attempt to solicit, the business of any client, or prospective client, of the Employer who was serviced or solicited by the Employee during his/her employment with the Employee.

The appellants Wisniewski left MD in 2013 to join RBC, a competitor. On their first day of work with RBC, the appellants wrote out from memory a list of MD’s clients that they had serviced and began phoning them.  The trial judge found they had breached their non-solicitation covenants.

On appeal, they allege that the agreement was ambiguous in regard to the term “solicit”, the geographic scope, the applicability to prospective clients, and the temporal length of the restriction. They also allege errors relating to the formation of the contracts generally.

Issue: Was the agreement so ambiguous with respect to the meaning of “solicit” as to render it unenforceable?

Holding:  Appeal dismissed.

Reasoning: No. The meaning of the word “solicit” is obvious. The calls made by the appellants to former clients were not – as the appellants suggest – courtesy calls. They were clearly made with a view to bringing the clients to RBC. The calls were made immediately after being hired by RBC, they were made personally, by telephone and followed a predetermined structure. The evidence supports the trial judge’s conclusion that the calls were to solicit business.

The trial judge properly directed himself with respect to the legal principles that address the enforceability of a non-solicitation clause. He referred to and applied the test in Elsley Estate v. J.G. Collins Agencies Ltd. He concluded that MD is a specialized company dealing with physicians and has a proprietary interest in ensuring that its business is not used by financial planners to take customers away from it.

He found that the clause was reasonable in terms of the public interest. It protects MD without unduly compromising its employees. There was no ambiguity with respect to the two year term.

The scope of the proscribed activities was clearly defined by the agreement. With respect to the formation of the contracts, the trial judge found that the individual appellants were provided with a copy of the non-solicitation provisions before starting their employment. This was a factual finding open to him on the evidence as were other factual findings made in his judgment. There is no reason for appellate intervention.

Robert v. Assis, 2018 ONCA 442

[Hourigan and Benotto and Fairburn JJ.A.]

Counsel:

J Sebastian Winny, for the appellants

Sharon Ilavsky, for the respondents

Keywords: Torts, Trespass, Intrusion Upon Seclusion, Nuisance, Abuse of Process, Reasonable Apprehension of Bias, Fresh Evidence

Facts:

The appellants brought an action against their next door neighbour seeking injunctive relief and damages for: (i) invasion of privacy arising from video and audio cameras which they say were trained on their property; (ii) nuisance arising from outside speakers, floodlights and the occasional errant hockey puck; (iii) trespass arising primarily from the construction of two fences; and (iv) abuse of process arising from an application for a peace bond made by the respondents before a justice of the peace. The trial judge dismissed the action. The appellants allege that the trial judge failed to decide the case on the merits, provided inadequate reasons and demonstrated a reasonable apprehension of bias.

Issues:

(1) Did the trial judge err in dismissing the action?

Held: Appeal dismissed.

Reasons: The trial judge carefully detailed the evidence of all parties and the claims made by the appellants. He concluded that the intrusion upon seclusion claim had not been proved. He found that there was no credible evidence to support the allegation. He also found that the claims by both parties were “hyperbolized”. He found that the nuisance had not been established, as the appellants never approached the respondents about such things as lights and music. The “couple of incidents” in which hockey pucks wound up in the appellants’ yard did not rise to the level of nuisance. Although a great deal of time at trial was spent on trespasses, the trial judge was not satisfied that the trespass with respect to the construction of the fence took place. Also, there was no evidence from a surveyor to establish where the lot line was in connection with the alleged moving of the stakes. There was no evidence of abuse of process as the trial judge found no dishonesty in relation to the application for a peace bond. The reasons read as a whole, indicate that findings of credibility were essential to all of these determinations. Those findings are entitled to deference. Further, the reasons clearly provide the parties with the rationale for the trial judge’s decision.

The bias allegation appears to arise from the trial judge’s question to counsel and subsequent comments about the fact that the parties did not take advantage of various mediation services. There is a strong presumption of judicial impartiality and a heavy burden on a party who seeks to rebut this presumption. The judge’s inquiry into mediation was eminently reasonable.

The fresh evidence is not admissible. It consists of further information about security cameras and a suggestion that the trial judge wrote bullet point comments about his reasons to a legal publisher, reacted with anger at the conclusion of counsel’s submissions, and asked about mediation. The evidence could have been adduced at trial, and it is clear that the proposed evidence is more of the same evidence already rejected by the trial judge.

Crump v. Fiture, 2018 ONCA 439

[Hourigan, Benotto and Fairburn JJ.A.]

Counsel:

S E. Batner and C. Piovesan, for the appellant
A Mladenovic and J. V. Leone, for the respondents

Keywords: Torts, Medical Negligence, Standard of Care, Causation, Reasons for Decision

Facts:

The respondent first complained of abdominal pain on May 20, 2000. By the evening of May 23, she was still suffering from pain and her mother took her to a walk-in clinic. The clinic doctor concluded that she likely had acute appendicitis with perforation. He referred her to the emergency room at the local hospital.

The emergency room concluded that she potentially had appendicitis and referred her for a surgical consult. The appellant, a general surgeon, examined her and concluded that she could be suffering from: (1) mesenteric adenitis secondary to respiratory tract infection and viremia; (2) menstrual pain related to cramps; or (3) early appendicitis.

The appellant did not order an ultrasound or admit her to the hospital. He discharged her and gave instructions to her mother regarding the circumstances upon which the respondent should be returned to the hospital.

By May 31, the respondent had a rising fever and was referred to the hospital where she underwent surgery. Her appendix had ruptured causing significant damage to her bowel.

Issues:

(1) Did the trial judge err in determining the standard of care of a general surgeon?

(2) Did the trial judge err in finding that causation had been established?

(3) Were the reasons of the trial judge neither timely nor sufficient?

Holding:

Appeal dismissed.

Reasoning:

(1) No. The appellant’s evidence was that he instructed the respondent’s mother to bring her back if her condition did not get better but the evidence of the respondent’s mother  was that she was to bring her daughter back only if her condition worsened. The trial judge preferred the mother’s evidence. In addition, evidence from the medical charts corroborated the mother’s version of the instructions. The trial judge did not err in finding that the appellant should have prioritized appendicitis as a “top drawer consideration”. This was supported by the evidence. The trial judge made no palpable and overriding error in finding that the appellant fell below the requisite standard of care for a general surgeon as at the relevant time.

(2) No. It is not a fair reading of the trial judge’s reasons to say that he solely relied on a different ranking of differential diagnosis in finding causation. The trial judge also relied on the finding that the appellant was negligent in his discharge instructions. The fact that the family doctor advised the respondent to follow the appellant’s advice does not interfere with the chain of causation as the expert witness testified that in the circumstances a family doctor would defer to the advice given by a surgeon.

(3) No. While there are parts of the reasons that would have benefitted from a more detailed analysis, this court was able to understand the trial judge’s conclusions on the issues and how he reached them. Also, while there was an inordinate delay in releasing reasons, in the context of this case, the delay did not impede the trial judge’s ability to fairly decide the case.

Rill v. Adams, 2018 ONCA 443

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

Counsel:

W.R., acting in person
L. Brusven, for the respondents

Keywords: Civil Procedure, Leave to Appeal, Torts, Medical Negligence, Standard of Care

Facts:

In the underlying action, the moving party alleged negligent medical diagnosis and drug treatment against the respondents. However, that action was dismissed because after being granted more than six months to provide satisfactory evidence that the respondents had breached the standard of care, the moving party still had not done so.

The moving party appealed to the Divisional Court. The Divisional Court judge dismissed the appeal giving careful reasons why the moving party’s action could not succeed in the absence of evidence of a breach of the standard of care. The judge considered both the fact that the moving party was self-represented, and the fact that it would be unfair to submit the parties to a proceeding that had no reasonable prospect of success. The moving party seeks leave to appeal to the Court of Appeal.

Issues:

(1) Should leave to appeal be granted?

Holding:

Motion dismissed.

Reasoning:

(1) No. The appellant has not identified any error in the reasons of the Divisional Court judge. There is no question of law or matter of public importance.

Hanson v. Totten Insurance Group Inc., 2018 ONCA 446

[MacFarland, LaForme and Epstein JJ.A.]

Counsel:

S Pickard, for the appellants

M Pearce and B Stephenson, for the respondents Totten Insurance Group Inc. and Lloyd’s Underwriters

M Stocks, for the respondents JM and LM

Keywords: Real Property, Contracts, Mortgages, Property Insurance, Coverage, Named Insureds, Insurable Interest, Subrogation

Facts:

This is an appeal from an order dismissing the appellants’ motion for summary judgment in a mortgage enforcement action. The respondents, Lloyd’s Underwriters (“Lloyd’s”) and Totten Insurance Group Inc. (“Totten”), had issued a policy of insurance to the respondents, JM and LM, the mortgagees of a property owned by the appellants, the mortgagors. Following a loss to the property, Lloyd’s paid JM and LM their mortgage loss and claimed, through subrogation, against the mortgagors. The mortgagors brought a motion for summary judgment in which they sought a determination as to whether the Lloyd’s policy covered their interest in the property so that the payment on the policy extinguished the mortgage debt.

In the usual situation of a homeowner with a mortgaged property, the homeowner, as required by standard mortgage terms, obtains and pays for a policy of insurance in his or her name. That policy will cover the homeowner’s interest in the property as well as the interest of the mortgagee. It is common practice for such policies to contain what is known as a standard mortgage clause. Such a clause will protect the interest of a mortgagee despite an act of the insured homeowner that would otherwise breach policy conditions. See, generally: Gowling Lafleur Henderson LLP, Marriott and Dunn: Practice in Mortgage Remedies in Ontario, loose-leaf (2018-Rel. 1), 5th ed. (Toronto: Thomson Reuters, 1994), vol. 2 at pp. 50-7 to 50-13; and Walter M. Traub, Falconbridge on Mortgages, loose-leaf (2017-Rel. 25), 5th ed. (Toronto: Thomson Reuters, 2017), at pp. 38-7 to 38-15.

However, in this case the appellants, who had obtained a private mortgage in the sum of $250,000 from JM and LM, were unable to obtain property insurance. JM and LM obtained a policy of insurance for $200,000 in their own names, which was underwritten by Lloyd’s. That policy stated that it protected only the interest of JM and LM as mortgagees.

Issues:

(1) Did the Lloyd’s policy also cover the appellants’ interest in the property?

(2) Is Lloyd’s entitled to exercise its right of subrogation having paid out the mortgagees’ interest?

Holding: Appeal dismissed.

Reasoning:

(1) No. The appellants argue that the motion judge erred in reaching the conclusion that the policy was only for the mortgagees’ benefit. They contend that the only reasonable interpretation of Standard Charge Term 16 is that a mortgagee must obtain insurance that will cover the interests of both the mortgagor and mortgagee when a mortgagor does not, for whatever reason, insure the subject property. The appellants argue that the language in Standard Charge Term 16 “…otherwise the Chargee may provide therefor and charge…” (emphasis added) can only mean that the mortgagee/chargee, if it chooses to obtain insurance coverage, must obtain the same coverage that the mortgagor/chargor is required to obtain. They argue the word “therefor” can only refer back to the language in the earlier portion of the provision which outlines the mortgagor’s/chargor’s obligation to insure.

There are a number of difficulties with this argument. First, the obligation to insure lies on the mortgagor/chargor in the first instance and is mandatory – the mortgagor/chargor will “immediately insure”. There is no obligation on the mortgagee/chargee to insure. That portion of the clause dealing with the mortgagee’s/chargee’s right to insure is merely permissive – the mortgagee/chargee “may provide therefor” (emphasis added). The appellants’ argument converts the permissive language of this term into a mortgagee’s/chargee’s mandatory obligation to obtain like insurance. Second, as the mortgagees discovered, mortgagees/chargees can only obtain insurance in their own names to cover their own interest in the subject property. The mortgagees do not have an insurable interest in the equity of redemption – only the appellants do. Finally, this Standard Charge Term 16 is for the benefit of mortgagees/chargees. The property is to be insured by the mortgagor/chargor and the cost of that insurance is to be borne by the mortgagor/chargor. The assumption of risk lies with the mortgagor/chargor, not the mortgagee/chargee.

Moreover, the appellants argument that the mortgagors expected that the insurance policy would cover their interest was rejected by the motion judge. Her finding in this regard is well-supported on the record before her.

(2) Yes. Their motion for summary judgment having been dismissed in its entirety, including their request for injunctive relief, there was no remaining impediment to the insurers proceeding with their power of sale proceedings.

Broadgrain Commodities Inc. v. Continental Casualty Company (CNA Canada), 2018 ONCA 438

[Doherty and Pepall JJ.A. and Gray J. (ad hoc)]

Counsel:

Rui Fernandes, James Manson, and Sean Lawler, for the appellant

Marc Isaacs and Hilary Weise, for the respondent

Keywords: Contracts, Insurance, Shipping, Summary Judgment, Evidence, Guarantee Co. of North America v. Gordon Capital Corp., [1999] 3 S.C.R. 423

Facts:

The appellant, Broadgrain Commodities Inc., sold 26 containers of sesame seeds to Beidahuang Grain Group Co. Ltd. (“Beidahuang”).  They were to be shipped CIF (‘cost, insurance, freight’) from Tin Can Island in Nigeria to Xingang in China.

The goods were loaded on board the transport vessel on October 15, 2014.  Beidahuang paid the appellant for the goods on December 12, 2014.  The goods arrived in China on December 17, 2014.  The goods had been damaged during transit, but the timing of the damage could not be determined.  The cargo was unfit for human consumption and was sold for salvage.  Beidahuang kept the salvage proceeds.

The goods were insured by the respondent, Continental Casualty Company carrying on business as CNA Canada, under a policy of marine insurance in favour of the appellant.  The appellant sought compensation from the respondent under the insurance policy, but the respondent denied coverage.  The appellant then sued the respondent, who subsequently brought a motion for summary judgment.

Issues:

(1)Did the motion judge err in granting summary judgment based on the finding that the appellant did not sustain any loss since the goods had been paid for in full by Beidahuang?

Holding: Appeal dismissed.

Reasoning:

(1) No. The appellant pleaded that the shipments were damaged by contact with water, resulting in a loss of US$550,081.38 to the appellant.  The appellant’s affidavit of documents and examination for discovery were silent on any evidence of loss.  The issue of a loss based on subsequent short-payments by Beidahuang relating to other shipments was first raised in an affidavit filed in response to the respondent’s summary judgment motion.

The court held that as stated by the Supreme Court in Guarantee Co. of North America v. Gordon Capital Corp., [1999] 3 S.C.R. 423, at para. 31: “[A] self-serving affidavit is not sufficient in itself to create a triable issue in the absence of detailed facts and supporting evidence”.

Here, no evidence of any kind was filed to support the allegation of short-payments: no dates, no amounts, no invoices, no credit statements, nothing.  Nor was there any explanation given for the absence of any supporting details or documentation. Accordingly, the court held that there was no palpable and overriding error, and deference is owed to the motion judge’s conclusion that the appellant was paid in full and that there was no credible evidence to the contrary.

Short Civil Decisions

The Catalyst Capital Group Inc. v. Moyse, 2018 ONCA 447

[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: Costs Endorsement

Cowan v. General Filters Inc., 2018 ONCA 445

[Pepall, Lauwers and Paciocco JJ.A.]

Counsel:

C I R Morrison, for the appellant

C A Chekan, for the respondent Dana Canada Inc. Filter Division

No one appearing for the respondents JC, SC, General Filters Inc., Canadian General Filters Limited, Lippert & Wright Fuels Ltd. also known as Dave Lippert Fuels Ltd., K & S Climate Control, and Oil Tech Plus Ltd.
Keywords: Civil Procedure, Appeals, Jurisdiction, Orders, Final or Interlocutory, Fusarelli v. Dube, [2005] O.J. No. 4398 (C.A.), Chertow v. Chertow (2001), 146 O.A.C. 141

Criminal Decisions

R v. Gilchrist, 2018 ONCA 430

[LaForme, Watt and Nordheimer JJ.A.]

Counsel:

C Gilchrist, in person

L Schwalm, for the respondent
Keywords: Provincial Offences, Driving Without Insurance, Provincial Offences Act, R.S.O. 1990, c. P. 33, Compulsory Automobile Insurance Act, R.S.O. 1990 c. P. 25

R v. Natsis, 2018 ONCA 425

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

Counsel:

M Henein and M Gourlay, for the appellant

J Klukach and L Schwalm, for the respondent
Keywords: Criminal Law, Impaired Driving Causing Death, Dangerous Driving Causing Death, Expert Evidence, Sentencing

R v. Piccinini, 2018 ONCA 433

[LaForme, Watt and Nordheimer JJ.A.]

Counsel:

C Kerr, for the appellant

M Flanagan, for the respondent
Keywords: Criminal Law, Fraud Over $5000, Theft Over $5000, R. v. Kienapple, [1975] 1 S.C.R. 729, Sentencing

R v. Spence, 2018 ONCA 427

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

Counsel:

C Verner and L Beechener, for the appellant

E Nakelsky, for the respondent
Keywords: Criminal Law, Manslaughter, Murder, Accessory After-The-Fact

R v. Hejazi, 2018 ONCA 435

[LaForme, Watt and Nordheimer JJ.A.]

Counsel:

M Dineen, for the appellant

C Suter, for the respondent
Keywords: Criminal Law, Breaking and Entering, Sexual Assault with a Weapon, Robbery, Unlawful Confinement, Possession of the Proceeds of Crime, Sentencing

R v Polanco, 2018 ONCA 444

[LaForme, Watt and Nordheimer JJ.A.]

Counsel:

D M Garg, for the appellant

M Gourlay, for the respondent
Keywords: Criminal Law, Summary Conviction, Assault, Assault with a Weapon, Assault Causing Bodily Harm, Theft Under $5,000

Workplace Safety and Insurance Board v. Curtis, 2018 ONCA 441

[Sharpe, Pardu and Fairburn JJ.A.]

Counsel:

David Shulman, for Selvamenan Kathirkamapillai

Andrew Bigioni, for Douglas Koomson

David Curtis and Mark Wiffen, amicus for David Curtis

Keywords: Regulatory Offences, Workplace Health and Safety, Mens Rea, Benefits, Material Change in Circumstances, Duty to Inform, Workplace Safety and Insurance Act, 1997, S.O. 1997, c. 16 Sched. A, s. 149(2)

R v. Vu, 2018 ONCA 436

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

Counsel:

J Norris, for D Vu

C A Chekan, for the respondent Dana Canada Inc. Filter Division

K Schofield and D Stein, for H T P and W W L

N Devlin and J North, for the Public Prosecution Service of Canada
Keywords: Criminal Law, Unauthorized Production of Marijuana, Sentencing, Mandatory Minimum, Canadian Charter of Rights and Freedoms, Section 12, Controlled Drugs and Substances Act, S.C. 1996, c. 19

R v. Williams, 2018 ONCA 437

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

Counsel:

W Cunningham, for the appellant

R Young, for the respondent
Keywords: Criminal Law, Assault Causing Bodily Harm, Dangerous Offenders

 

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 30 – MAY 4, 2018)

Good evening.

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

In Maple Leafs Foods, a class action brought by Mr. Sub franchisees against Maple Leaf for economic loss suffered as a result of the listeria outbreak at a Maple Leaf plant several years ago was dismissed. The Court held that while Maple Leaf may well have had liability for personal injury suffered by anyone who consumed contaminated meat, it did not have a duty not to harm the reputation or profits of Mr. Sub franchisees who sold Maple Leaf meats.

In a doctor’s professional discipline decision, the Court restored the penalty for professional misconduct imposed by the discipline committee, in the process, overturning the Divisional Court.

In Jackson v. Stephen Durbin and Associates, the Court held that any retainer agreement between a lawyer and client that ties the amount of compensation to be paid to the outcome is a contingency fee agreement. The retainer agreement at issue was for a family law matter. Section 28.1(3)(b) of the Solicitors Act prohibits contingency fee agreements in family law cases.

Finally, the Court released its decision in Forcillo in R. v. Forcillo. The appeal from the conviction of the constable for attempted murder was dismissed.

I hope everyone has an enjoyable weekend.

John Polyzogopoulos

Blaney McMurtry LLP

jpolyzogopoulos@blaney.com

Tel: 416 593 2953

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

Table of Contents

1688782 Ontario Inc. v. Maple Leaf Foods Inc., 2018 ONCA 407

Keywords:Torts, Negligence, Duty of Care, Established Categories, Proximity, Foreseeability, Damages, Pure Economic Loss, Anns/Cooper Test, Anns v. Merton London Borough Council, [1978] A.C. 728 (H.L.); Cooper v. Hobart, 2001 SCC 79, [2001] 3 S.C.R. 537, Deloitte & Touche v. Livent Inc. (Receiver of), 2017 SCC 63, PlasTex Canada Ltd. v. Dow Chemical of Canada Ltd., 2004 ABCA 309, 245 D.L.R. (4th) 650, leave to appeal refused [2004] S.C.C.A. No. 542; 376599 Alberta Inc. v. Tanshaw Products Inc., 2005 ABQB 300, 379 A.R. 1; Country Style Food Services Inc. v. 1304271 Ontario Ltd. (2005), 200 O.A.C. 172, Civil Procedure, Class Actions, Summary Judgment

Capcorp Planning (2003) Inc. v. Ontario (Finance), 2018 ONCA 406

Keywords: Taxation, Retail Sales Tax, Statutory Interpretation, Failure to Collect and Remit, Unfunded Employee Benefits Plans, Burden of Proof, Retail Sales Tax Act, R.S.O. 1990, c. R. 31

Davis v. East Side Mario’s Barrie, 2018 ONCA 410

Keywords: Torts, Negligence, Slip and Fall, Occupiers’ Liability Act, R.S.O. 1990, c. O.2, Consumer Protection Act, 2002, S.O. 2002, c. 30, Sched. A., Civil Procedure, Limitation Periods, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, Rules of Civil Procedure, R.R.O. 1990, Reg. 194

Butler v. Royal Victoria Hospital, 2018 ONCA 409

Keywords: Torts, Negligence, Medical Malpractice, Causation, Damages, Future Loss of Income, Costs

Iroquois Falls Power Corp. v. Jacobs Canada Inc., 2018 ONCA 412

Keywords: Civil Procedure, Dismissal for Delay, Rule 48.14, Rules of Civil Procedure

992548 Ontario Inc. v. 8657181 Canada Inc., 2018 ONCA 416

Keywords: Real Property, Mortgages, Civil Procedure, Default Judgments, Setting Aside, Relief from Forfeiture, Winters v. Hunking, 2017 ONCA 909

Beaver v. Hill, 2018 ONCA 415

Keywords: Civil Procedure, Motions, Interim Costs, Cross-Examination on Affidavits, Orders, Breach, Re Ferguson and Imax Systems Corp. (1984), 47 O.R. (2d) 225 (Div. Ct.), Dickie v. Dickie, 2007 SCC 8

College of Physicians and Surgeons of Ontario v. Peirovy, 2018 ONCA 420

Keywords: Administrative Law, Regulated Professions, Doctors, Professional Discipline, Standard of Review, Reasonableness, Penalty, R. v. Chase, [1987] 2 S.C.R. 293

Rahaman v. Fiscia, 2018 ONCA 418

Keywords: Contracts, Real Property, Debtor-Creditor, Civil Procedure, Applications, Rules of Civil Procedure, Rule 2.01

Yasin v. Ontario, 2018 ONCA 417

Keywords: Administrative Law, Vital Statistics Act, R.S.O. 1990, c. V.4, Jurisdiction, Remedies, Declarations, Civil Procedure, Necessary and Proper Parties

Jackson v. Stephen Durbin and Associates, 2018 ONCA 424

Keywords: Contracts, Solicitor and Client, Illegality, Contingency Fee Agreements, Family Law, Solicitors Act, R.S.O. 1990, c. S. 15, s. 28.1(3)(b)

Criminal Decisions

Short Civil Decision

Civil Decisions:

1688782 Ontario Inc. v. Maple Leaf Foods Inc., 2018 ONCA 407

[Sharpe, Rouleau and Fairburn JJ.A.]

Counsel:

S. Stieber and E. Bowker, for the appellants

P.W. Kryworuk, R. Case and J. Damstra, for the respondent

Keywords:Torts, Negligence, Duty of Care, Established Categories, Proximity, Foreseeability, Damages, Pure Economic Loss, Anns/Cooper Test, Anns v. Merton London Borough Council, [1978] A.C. 728 (H.L.); Cooper v. Hobart, 2001 SCC 79, [2001] 3 S.C.R. 537, Deloitte & Touche v. Livent Inc. (Receiver of), 2017 SCC 63, PlasTex Canada Ltd. v. Dow Chemical of Canada Ltd., 2004 ABCA 309, 245 D.L.R. (4th) 650, leave to appeal refused [2004] S.C.C.A. No. 542; 376599 Alberta Inc. v. Tanshaw Products Inc., 2005 ABQB 300, 379 A.R. 1; Country Style Food Services Inc. v. 1304271 Ontario Ltd. (2005), 200 O.A.C. 172, Civil Procedure, Class Actions, Summary Judgment

Facts:

In August 2008, certain Maple Leaf brand ready-to-eat (“RTE”) meats became contaminated with listeria. Some people fell seriously ill and some died after eating the meat. Maple Leaf recalled meats that were produced at the production plant where the infected meat originated. The recall and plant closure affected the supply of two of the RTE meats used by the franchisees of Mr. Submarine Ltd. (“Mr. Sub”). The agreement requires the franchisees to purchase products exclusively from Mr. Sub or sources or suppliers approved by it. Although franchisees may purchase products not previously authorized by Mr. Sub, this may only be done with Mr. Sub’s approval. The franchisees did not buy the RTE meats directly from Maple Leaf. Instead, Maple Leaf dealt with distributors who, in turn, dealt with the franchisees. The franchisees would place their orders with, and be invoiced by, the distributors. Similarly, the distributors would place their orders with Maple Leaf and, in turn, be invoiced by Maple Leaf.

A class action was certified on behalf of Mr. Sub franchisees against Maple Leaf Foods Inc. and Maple Leaf Consumer Foods Inc. (collectively “Maple Leaf”). The representative plaintiff, 1688782 Ontario Inc., claims damages on the basis that Maple Leaf: (a) negligently manufactured and supplied potentially contaminated meat; and (b) negligently represented that the supplied meats were fit for human consumption. There is no evidence that any Mr. Sub customer was harmed by any contaminated product. However, the representative plaintiff alleges that the franchisees suffered economic losses arising in large part from the reputational harm they say they experienced from being publicly associated with Maple Leaf in the aftermath of the listeria outbreak. In particular, the representative plaintiff claims damages for loss of past and future sales, past and future profits, and loss of capital value and goodwill. It also claims damages for clean-up costs and other costs related to the disposal, destruction and replacement of RTE meats.

After certification of the class action, Maple Leaf brought a summary judgment motion seeking dismissal of certain claims on the basis that Maple Leaf owed no duty of care to the class. The representative plaintiff, in turn, asked that summary judgment be granted in its favour. The appeal by Maple Leaf arises from the motion judge’s decision concluding that Maple Leaf owed a duty of care to the franchisees “in relation to the production, processing, sale and distribution of the RTE Meats” and a duty of care “with respect to any representations made that the RTE Meats were fit for human consumption and posed no risk of harm.”

Issues:

(1) Did the motion judge err in finding that Maple Leaf supplied the representative plaintiff with a defective product dangerous to public health?

(2) Did the motion judge err in concluding that this case falls within a recognized duty of care?

(3) Did the motion judge err in failing to consider and properly apply the Anns/Cooper test?

(4) Did the motion judge err in finding that damages for pure economic loss are recoverable in this case?

Holding: Appeal allowed.

Reasoning:

(1) No. Reading the impugned comment in context, the motion judge was saying that there was a risk that the two core menu items could compromise human health, given that they had been produced at the same plant as the tainted products.

(2) Yes. Maple Leaf submitted that the motion judge improperly relied on three decisions to conclude that Maple Leaf’s relationship with the representative plaintiff fell within a recognized duty to supply a product fit for human consumption: PlasTex Canada Ltd. v. Dow Chemical of Canada Ltd., 245 D.L.R. (4th) 650, leave to appeal refused [2004] S.C.C.A. No. 542; 376599 Alberta Inc. v. Tanshaw Products Inc., 2005 ABQB 300; Country Style Food Services Inc. v. 1304271 Ontario Ltd. (2005), 200 O.A.C. 172. Plas-Tex and Tanshaw are said to support the conclusion that a manufacturer has a recognized duty of care to those in its supply chain not to manufacture and provide a product that has become dangerous as a result of negligence.

The motion judge’s summary judgment reasons are not entirely clear on this point, but any ambiguity as to whether the motion judge determined that the relationship between the parties fell within an established category is resolved by the motion judge’s costs ruling. The motion judge concluded that the certification and summary judgment motions did not raise a novel issue of law, noting that “the relationship between the parties fell within a recognized duty of care.”

The motion judge, who did not have the benefit of Livent when she decided this case, improperly relied on Plas-Tex, Tanshaw and Country Style to conclude that Maple Leaf’s relationship with the representative plaintiff fell within a recognized duty of care to supply a product fit for human consumption. The majority in Livent warned that courts should be cautious in finding proximity based upon a previously established or analogous category.

Plas-Tex, Tanshaw and Country Style are readily distinguishable from this case, where it is alleged that Maple Leaf should be held liable for damages for the reputational harm to the franchisees as a result of a recall and their public association with Maple Leaf. As a result, it is necessary to conduct a full Anns/Cooper analysis to assess whether the motion judge’s conclusion that the relationship between Maple Leaf and the franchisees was such that a duty of care to supply fit meat extends to the damages at issue on this appeal is sustainable.

(3) Yes. In concluding that Maple Leaf owed a duty to supply a product fit for human consumption to the representative plaintiff, the motion judge found that the circumstances of the relationship between the representative plaintiff and Maple Leaf were such that Maple Leaf was under an obligation to be mindful of the plaintiff’s legitimate interests in conducting its affairs. The motion judge erred in failing to consider the scope of the proximate relationship or scope of any such duty arising from it.

To the extent there may be a duty to supply meat fit for human consumption, it does not extend to the franchisees’ damages for pure economic loss at issue here. Maple Leaf’s duty of care in tort to supply meat fit for human consumption, a duty which is aimed at protecting human health, was owed to the franchisees’ customers, not the franchisees. The claim advanced against Maple Leaf in this action rests upon an alleged additional and quite different duty owed to franchisees to protect their reputation and pay for any consequent damages for pure economic losses.

The alleged damages are, in large part, a consequence of the public announcement of the recall and resulting publicity. To conclude that Maple Leaf owed a duty of care in tort to the franchisees to protect them against the kinds of damages at issue on this appeal would be to enlarge the duty to safeguard the health and safety of customers by supplying fit meat to include a quite different and added duty to franchisees to protect against reputational harm. To do so would constitute an unwarranted expansion of a duty owed to one class of plaintiffs and extend it to the fundamentally different claim advanced by the franchisees.

The motion judge found that it was “reasonable, appropriate, and foreseeable for consumers to avoid buying food from a restaurant where there had been a food recall arising from problems in the plant of its meat supplier that were not ‘resolved’ for a relatively significant period of time”. However, this finding of reasonable foreseeability is not enough to give rise to a duty of care in tort to the franchisees which can only arise where the foreseeable harm falls within the scope of a proximate relationship. In light of these conclusions, it is unnecessary to address the issue of whether there are any residual policy considerations that would negate the imposition of a duty of care.

In the context of negligent misrepresentation cases, proximity is most usefully considered before foreseeability because “[w]hat the defendant reasonably foresees as flowing from his or her negligence depends upon the characteristics of his or her relationship with the plaintiff, and specifically … the purpose of the defendant’s undertaking”. While Livent affirms that when undertaking a full proximity analysis the court must examine all relevant factors arising out of the relationship between the plaintiff and the defendant, two factors are determinative in the case of negligent misrepresentation – the defendant’s undertaking and the plaintiff’s reliance.

Here, the motion judge found that Maple Leaf ought reasonably to have foreseen that the representative plaintiff would rely on its representation – namely, that the RTE meats were fit for human consumption and posed no risk of harm – and its reliance was reasonable in the circumstances. She noted that the representative plaintiff was within a known and readily identifiable category of persons and that Maple Leaf was the representative plaintiff’s exclusive supplier. Maple Leaf was aware that the RTE meats would be offered for sale to consumers who could be injured if it was unfit. There was an error in failing to consider the scope of the proximate relationship between the parties, which in turn affected the foreseeability analysis.

Maple Leaf undoubtedly undertook – in the context of its contractual relationship with the franchisor – to supply meat safe for human consumption by Mr. Sub customers. The nature or purpose of such an undertaking was to ensure that Mr. Sub customers who ate RTE meats would not become ill or die as result of eating the meats. The purpose of the undertaking was not, however, to protect the reputational interests of the franchisees. The reputational damage said to be sustained by the plaintiff, arising from Maple Leaf’s supply to others and from the recall – aimed at safeguarding health and safety – falls outside the scope of Maple Leaf’s undertaking to the franchisees. Accordingly, the alleged injury was not reasonably foreseeable.

In light of the conclusions on stage one of the Anns/Cooper analysis, it is unnecessary to address residual policy considerations other than to note that the concern about encouraging effective recalls is equally applicable in this context. In conclusion, Maple Leaf’s duty of care with respect to any representations made that the RTE meats were fit for human consumption and posed no risk of harm does not extend to the damages for pure economic loss claimed here.

(4) Not decided. Maple Leaf argues that the motion judge erred in determining that the damages claimed as arising out of economic losses were recoverable. In particular, it says that there can be no claim in negligence for a defective but non-dangerous good, where no personal injury or damage to property was incurred. Given the conclusion that the motion judge erred in her duty of care analysis, it was unnecessary to consider this argument on appeal.

Capcorp Planning (2003) Inc. v. Ontario (Finance), 2018 ONCA 406

[Watt, Pepall and Miller JJ.A.]

Counsel:

L. Patyk and J. DeFreitas, for the appellant

G. Sanders and C. Morris, for the respondent

Keywords: Taxation, Retail Sales Tax, Statutory Interpretation, Failure to Collect and Remit, Unfunded Employee Benefits Plans, Burden of Proof, Retail Sales Tax Act, R.S.O. 1990, c. R. 31

Facts:

The Respondent, Capcorp Planning (2003) Inc. (“Capcorp”), sold an employee health and welfare plan (“HWP”). Some employers found the HWP attractive, especially owner/manager operations where the owner or manager of the corporation was the only employee seeking coverage.

Under Capcorp’s HWP, a participating employer agreed to pay specified expenses incurred by participating employees. When an employee incurred an expense said to be covered by the HWP, the employer submitted a claim and a cheque to Capcorp for the expense claimed and an administrative fee for Capcorp. After a review of the claim, Capcorp determined whether the expense claimed was covered by the HWP. If the claim was covered, Capcorp reimbursed the employee for the expense.

Capcorp did not charge retail sales tax (“RST”) on any amounts employers paid and it received in respect of claims made under the HWP. The Appellant, the Minister of Revenue (“the Minister”), considered that RST was exigible for these amounts, assessed Capcorp accordingly and required Capcorp to pay a penalty of $278,625.31, including interest for failure to collect and remit the RST the Minister considered applicable. The assessment was based on the auditor’s determination that the HWP was a “benefits plan” subject to taxation under the Retail Sales Tax Act, R.S.O. 1990, c. R. 31 (“RSTA”), as amended. Capcorp, by extension, was required to charge, collect and remit RST. Failure to do so rendered the company liable to the penalty assessed.

Capcorp objected, but the Minister affirmed the assessment and penalty.

The appeal judge concluded that the HWP was not a policy of insurance, group insurance, or a funded benefits plan. In his view, the HWP was most akin to an “unfunded benefits plan” for the purposes of the RSTA. He accepted the evidence adduced by Capcorp that most of the employers who enrolled in the HWP could not obtain health insurance that would supplement their OHIP coverage. In the absence of evidence from the Minister to contradict the testimony about the HWP constituency, the appeal judge concluded that since those who enrolled in the HWP would not be able to obtain insurance coverage, they were not required to pay RST on the amount they paid to Capcorp.

Issues:

(1) Did the appeal judge err in his interpretation of the definition of an “unfunded benefits plan” under the RSTA?

(2) In the alternative, did the appeal judge err in in his consideration of the evidence, by prematurely shifting the burden of proof to the Minister, in failing to consider relevant evidence and in misapprehending the nature and sufficiency of Capcorp’s evidence?

Holding: Appeal allowed.

Reasoning:

(1) Yes. Section 2.1(1) of the RSTA, in relevant part, requires that “[e]very person who is resident in Ontario, or who carries on business and Ontario and who:

(a) enters into a contract of insurance with an insurer;

(b) is a person whose risk is covered by group insurance;

(c) is a planholder or member of a benefits plan;

shall pay … a tax at the rate of 8 percent of the premium payable” (emphasis added).

A “benefits plan” is defined under s. 1(1) of the RSTA as a funded benefits plan, an unfunded benefits plan or a qualifying trust. The term “unfunded benefits plan” is exhaustively defined in s. 1(1) to mean:

a plan which gives protection against risk to an individual that could otherwise be obtained by taking out a contract of insurance, whether the benefits are partly insured or not, and where payments are made by the planholder directly to or on behalf of the member of the plan or to the vendor upon the occurrence of the risk. [Emphasis added.]

The court considered whether the term “unfunded benefits plan” included a plan that provides protections generally available under contracts of insurance, but unavailable to specific participants because of their pre-existing medical conditions, or some other reason.

The court stated that it has been long established that there is but one principle or approach to statutory interpretation which is that the words of the statute are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act and the intention of the enacting legislative body.

In light of these principles, the court held that the HWP is an “unfunded benefits plan” as the term is defined in s. 1(1) of the RSTA, and thus subject to RST, although the plain language within s. 1(1) did not resolve the issue at hand. To reach this conclusion, the court looked to the legislative purpose and found that benefits plans became subject to RST following an amendment to the RSTA: Bill 138, An Act to amend the Retail Sales Tax Act, 3rd Sess., 35th Leg., Ontario, 1994.

Therefore, benefits plans – funded or unfunded – are taxed because the legislature has determined that such plans are substitutes for insurance, and should therefore receive similar tax treatment to contracts of insurance. Crucially, a plan does not cease to be a substitute for a contract of insurance simply because it provides protections above and beyond those that specific plan members could have obtained in the marketplace. The court stated that to hold otherwise would arbitrarily exclude some benefits plans from the scope of s. 1(1), unduly restricting the provision’s reach.

(2) Yes. On the appeal in the Superior Court of Justice, the appeal judge held that Andrew Noseworthy, the Chief Executive Officer of Capcorp, established a prima facie case that planholders – individual owner/managers – could not obtain insurance coverage for the same risks covered by the HWP. Since the Minister had failed to adduce any contrary evidence, the appeal judge quashed the Minister’s assessment.

The court stated that under s. 18(1) of the RSTA, where a vendor has failed to make a return or a remittance as required under the Act, the Minister may make an assessment of the tax collected by the vendor for which the vendor has not accounted and the assessed amount is deemed to be the tax collected by the vendor. Subject to being varied or vacated on an objection or appeal and subject to a reassessment, the Minister’s assessment is deemed to be valid and binding on the taxpayer or vendor: RSTA, s. 18(8). It follows from these statutory provisions that the taxpayer bears the burden of establishing that the factual findings (or assumptions) on which the Minister grounded the assessment are wrong.

The court held that the appeal judge’s error in finding that Capcorp’s evidence constituted a prima facie case that rebutted the assumptions underlying the Minister’s assessment followed from the judge’s error in interpreting the term “unfunded benefits plan” under s. 1(1) of the Act.

The court held that Capcorp’s evidence was general in nature and fell short of establishing a prima facie case that “protection against risk to an individual” including any undertaking to pay, among other things, “for supplemental healthcare, drugs, dental care, vision care, hearing care or for protection against loss of income due to illness or accident…”, could not “otherwise be obtained through contracts of insurance”, on the proper construction of the phrase.

Davis v. East Side Mario’s Barrie, 2018 ONCA 410

[MacFarland, LaForme and Epstein JJ.A]

Counsel:

J. Keenan Sprague, for the appellants

R. Love and E. Vila, for the respondent

Keywords: Torts, Negligence, Slip and Fall, Occupiers’ Liability Act, R.S.O. 1990, c. O.2, Consumer Protection Act, 2002, S.O. 2002, c. 30, Sched. A., Civil Procedure, Limitation Periods, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, Rules of Civil Procedure, R.R.O. 1990, Reg. 194

Facts:

The appellant KD, while carrying her newborn baby PD, fell while going down a set of stairs to use a washroom located on the lower level of the respondent’s Barrie premises. KD pleaded “negligence, breach of duty, breach of contract and breach of the Occupiers’ Liability Act, R.S.O. 1990, c. O.2” (the “OLA”) regarding the staircase where the fall occurred. The respondent brought a motion for summary judgment. During the motion the appellant advanced a novel argument alleging that the defendant breached its statutory warranty that its service supplied to the plaintiff would be of reasonably acceptable quality pursuant to the Consumer Protection Act, 2002, S.O. 2002, c. 30, Sched. A (“CPA”). The motion judge granted summary judgment on the basis of the record before him and dismissed the appellant’s action “as pleaded” but did so “without prejudice to the plaintiffs to bring a motion to amend their statement of claim to plead the ‘novel questions of law’ described above.”

The parties agreed to an order amending the statement of claim “without prejudice to any of the Defendant’s rights, including but not necessarily limited to the Defendant’s right to bring a further motion for procedural/substantive relief on the grounds that the amendments do not disclose a cause of action, are barred by the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, and otherwise do not disclose a genuine issue requiring trial”.

A second motion for summary judgment followed and proceeded before de Sa J. (the “Second Motion Judge”) and is the subject of this appeal. The Second Motion Judge concluded “In my view, it is essentially an alternative theory of liability for the same complaint…I agree with the Plaintiffs that the Amended Claim does not advance a “new cause of action” for the purposes of the Limitations Act and under normal circumstances an amendment would be permissible under Rule 26.01 [of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194].” He went on, however, despite the agreement of the parties to argue only the limitation point before him, to conclude that there was no genuine issue for trial.

In light of the agreement of counsel as to the issue to be argued before the Second Motion Judge, this appeal falls to be determined on whether or not the Second Motion Judge erred in concluding that the amendments to the statement of claim did not constitute a new cause of action. The appellants concede that if they do, their claim is statute-barred.

Issues:

(1) Is the CPA claim a new cause of action?

Holding: Appeal dismissed.

Reasoning:

(1) Yes. However, because it is a new cause of action, it is barred by the Limitation Act, 2002.  The original statement of claim pleaded general negligence, breach of duty, breach of contract and breach of the OLA. The focus clearly was on the appellant’s fall down the stairs as the cause of her injuries. The amended claim, on the other hand, is focused on the failure to advise and contains new pleas in support of what the appellants describe as their alternative theory of liability. The original statement of claim focused on the staircase that they alleged was dangerous, inadequately maintained, poorly lit and caused the plaintiff to fall. In the amended claim the plea is very different. The appellant pleads a new duty of care: a duty to advise the appellant of the existence and availability of washroom facilities on the main floor of the restaurant. They argue that provisions of both the OLA and the CPA support these arguments. While the OLA was pleaded in the original statement of claim, it was pleaded in relation to the condition of the staircase. The new claim is a fundamentally different claim based on facts not originally pleaded. It is not mere particulars of the prior claim. The CPA and its relationship with the OLA is a new plea in support of a new cause of action and the Second Motion Judge erred in finding to the contrary. Because the new plea raises a new cause of action, it is statute-barred as it is raised for the first time, long after the two-year period of limitation has expired.

Butler v. Royal Victoria Hospital, 2018 ONCA 409

[LaForme, Epstein and Pardu JJ.A.]

Counsel:

V. Wise and R. Mediratta, for the appellants

G. MacKenzie and B. MacKenzie, for the respondents

Keywords: Torts, Negligence, Medical Malpractice, Causation, Damages, Future Loss of Income, Costs

Facts:

In September 2008, SB was diagnosed with hypotonic cerebral palsy. SB’s condition was caused by hospital nurses’ negligent artificial rupture of her membranes at the birth of her and her twin brother on January 26, 2007. Only at the beginning of the trial did the appellants admit they fell below the standard of care. That admission left the issues of causation and damages to be determined. In particular, the appellants submitted SB’s cognitive and behavioural issues were not entirely caused by the birth injury and that the claims under various heads of damages were excessive.

After a five-and-a-half-week trial, in comprehensive reasons for judgment, the trial judge held that the birth injury was the sole cause of the numerous conditions that were negatively affecting SB. He awarded the respondents $5,568,393 in damages, which included $1,881,846 for future loss of income. The trial judge, in separate reasons for decision, fixed the respondents’ costs in the amount of $2,201,259 inclusive of fees, HST, and disbursements. The fee portion of the costs award totaled $1,503,466.

The appellants submit the trial judge erred in two respects when deciding the issue of SB’s future income loss, namely: (i) his finding that SB would have completed college; and (ii) his approach to contingencies. They also appeal the costs award.

Issues:

  • Did the trial judge err with respect to the award for future loss of income?
  • Did the trial judge err with respect to the issue of costs?

Holding: Appeal dismissed.

Reasoning:

(1) No. First, the trial judge’s finding that there was a real and substantial possibility that SB would have graduated from college, but not university, and would have been employed full-time if it were not for the birth injuries she sustained is entirely reasonable. In making this finding, the trial judge properly weighed the evidence and neither ignored relevant evidence nor failed to consider a relevant factor in a legal test. There was ample evidence before him to support his conclusion that SB probably would have completed college but for the appellants’ negligence. The appellants have failed to demonstrate any reason why the court should disturb his conclusion.

Second, although trial judges are entitled to adjust an award for future loss of income to account for general contingencies—whether upwards or downwards—it is not an error of law for the trial judge to decline to do so: see Graham v. Rourke, 75 O.R. (2d) 622 at p. 636; Gerula v Flores, [1995] O.J. No. 2300, at para. 41. It is certainly arguable that an inference is available that both positive and general contingencies could be drawn from all the evidence: see Beldycki Estate v. Jaipargas, 2012 ONCA 537; Gerula, at para. 41.

While the trial judge based his assessment on the starting point of female average full time earnings to age 65, it was open to him to conclude that temporary absences from the workforce would be offset by benefit programs such as employment or disability insurance.  He was therefore not obliged to make a downward adjustment for non-participation in the workforce.  Calculation of the future loss of income of any child, let alone one born profoundly disabled, is not an exact science.

  • Leave to appeal a costs order will not be granted except in obvious cases where the party seeking leave convinces the court there are “strong grounds upon which the appellate court could find that the judge erred in exercising his discretion”: Brad-Jay Investments Limited v. Village Developments Limited (2006), 218 OAC 315, at para. 22. The trial judge noted that this case involved more than eight years of litigation leading up to trial, which included days of examinations for discovery, multiple pre-trials, and countless exchanges of correspondence. The trial judge was not required to adopt a weighted average of partial indemnity and substantial indemnity costs. A costs award does not have to be measured with exactitude. Rather, it should reflect a fair and reasonable amount that should be paid by the unsuccessful parties: Zesta Engineering Ltd v. Cloutier (2002), 21 C.C.E.L. (3d) 161..

Iroquois Falls Power Corp. v. Jacobs Canada Inc., 2018 ONCA 412

[MacFarland, LaForme and Epstein JJ.A.]

Counsel:

P. A. Ivanoff and E. Thomas, for the appellant, Iroquois Falls Power Corp.

B. Maynard, for the respondents, Chubb Insurance Company of Canada and American Home Assurance Company

R. Rueter, for the respondents, Jacobs Canada Inc. and McDermott Incorporated

Keywords: Civil Procedure, Dismissal for Delay, Rule 48.14, Rules of Civil Procedure

Facts:

Iroquois Falls Power Corp. (“IFPC”) appeals from the orders of the Superior Court of Justice dismissing its action for delay and awarding costs to the respondents. The action was commenced in 2005. IFPC alleged that the engineering work related to two natural gas turbines at a power generating station was negligently performed. This action was dismissed in March 2007 when the respondents obtained summary judgment. The Court of Appeal allowed IFPC’s appeal, in part.

IFPC then brought a motion to amend its statement of claim, which was dismissed in September 2008. The Court of Appeal overturned that decision in 2009. No further steps have been taken since then to bring the action to trial.

As of January 1, 2017, Rule 48.14(1) now requires the registrar to dismiss all actions in Ontario that were five or more years old and had not been set down for trial. There is no authority for the registrar to order costs. The respondents brought a motion on January 4, 2017, under Rule 24.01(1) to dismiss IFPC’s action for delay and for their costs of the action. IFPC did not dispute that the action should be dismissed for delay but instead brought its own motion to require the court give effect to Rule 48.14(1) and dismiss the action, but without costs. In particular, IFPC took the position that its action should have been dismissed by the registrar on January 1, 2017, pursuant to Rule 48.14(1) with no costs. IFPC, therefore, asked the motion judge for an order, nunc pro tunc, that this action be administratively dismissed effective January 1, 2017.

The motion judge granted the respondents’ motion under Rule 24.01(1) and under the court’s inherent jurisdiction and ordered that the action of IFPC be dismissed for delay. Further, he found that the registrar had acted appropriately in not dismissing the action under Rule 48.14(1). He held that the Rule does not apply to case managed actions, such as this one. The motion judge declined IFPC’s request to grant an order under the Rule, nunc pro tunc dismissing the action effective January 1, 2017.

Issue: In dismissing the action for delay under Rule 24, did the motion judge fail to recognize that the “new regime” that has been ushered in by the legislature under Rule 48.14 takes precedence over Rule 24?

Holding: Appeal dismissed.

Reasoning:

Rule 48.14 does not take precedence over Rule 24.01, nor does it oust the jurisdiction of the court from dealing with any action that is subject to dismissal by the registrar under Rule 48.14.

There is no hierarchy as between Rule 24.01 and Rule 48.14. Each of the Rules simply provide a different means that may lead to the dismissal of the plaintiff’s action for delay. There is nothing in the language of Rule 48.14 to even suggest an intention that the jurisdiction of the registrar to issue an administrative order under Rule 48.14 takes precedence over the jurisdiction of the court.

Non-compliance with a rule is an irregularity and a court “may grant all necessary amendments or other relief, on such terms as are just” and where “necessary in the interest of justice, may set aside the proceeding or a step, document or order in the proceeding in whole or in part”: Rule 2.01(1). Thus, rather than Rule 48.14 ousting the jurisdiction of the court in favour of the registrar, the court’s paramount jurisdiction is manifestly recognized.

992548 Ontario Inc. v. 8657181 Canada Inc., 2018 ONCA 416

[MacFarland, LaForme and Epstein JJ.A.]

Counsel:

P. Starkman, for the appellant

J. McNulty, for the respondent

J. Masterman, for LH Golf Group Inc.

Keywords: Real Property, Mortgages, Civil Procedure, Default Judgments, Setting Aside, Relief from Forfeiture, Winters v. Hunking, 2017 ONCA 909

Facts:

The appellant, 8657181 Canada Inc., mortgaged property it owned to the respondent, 992548 Ontario Inc. The appellant defaulted on the mortgage and the respondent obtained a default judgment for foreclosure. This is an appeal from the dismissal of the appellant’s motion to set aside the judgment and for relief from forfeiture with respect to the default under the mortgage.

Issues:

(1) Did the motion judge err in dismissing the appellant’s motion to set aside the judgment?

Holding: Appeal dismissed.

Reasoning:

(1) No. The appellant’s argument is based on the court’s recent decision in Winters v. Hunking, 2017 ONCA 909, decided after the motion judge’s reasons were released. The appellant argues that the motion judge erred by not considering the importance of the windfall the respondent would realize in the context of the appellant’s circumstances if the default foreclosure judgment were to stand.

This case is very different from Winters v. Hunking. The appellant did not provide any evidence relating to its investment, appraised value, or the portion of the purchase price allocated to the land in the original purchase. There is no evidentiary foundation for the respondent’s claim that the property is undervalued. No consideration of windfall is possible without evidence.

It is important to emphasize that setting aside a default judgment for foreclosure is exceptional relief, and the outcome in Winters v. Hunking turns on its facts. The motion judge’s decision was discretionary and entitled to deference. The issue is whether a decision whether to set aside a default judgment for foreclosure is whether the equities in favour of the mortgagor outweigh those in favour of the mortgagee or – to the same effect, adopting the language pertaining to setting aside default judgments, generally – whether the decision to set aside the order leads to a just result in all the circumstances.

Beaver v. Hill, 2018 ONCA 415

[Brown J.A. (Motions Judge)]

Counsel:

A. Lokan, for the responding party

M. McCarthy, for the moving party

Keywords: Civil Procedure, Motions, Interim Costs, Cross-Examination on Affidavits, Orders, Breach, Re Ferguson and Imax Systems Corp. (1984), 47 O.R. (2d) 225 (Div. Ct.), Dickie v. Dickie, 2007 SCC 8

Facts: The applicant Mother filed an affidavit in support of her motion for advance (interim) funding in respect of the appeal of the respondent, the father, from the order of Chappel J. dismissing his challenge to the jurisdiction of Ontario courts to adjudicate Mother’s claims against him for custody, child support, and spousal support. The Father wants to cross-examine the Mother on her affidavit, which she opposes.

The Father identifies the areas on which he wants his counsel to cross-examine: (i) her retainer agreement with her counsel; (ii) payments she has made to counsel; (iii) efforts she has made to obtain legal funding from other sources; (iv) the amount she is prepared to contribute to fund her response to the appeal; and (v) the basis for her request for $100,000 in interim costs.

Issue:

(1) Should the Father be permitted to cross-examine the Mother on her affidavit submitted in support of her motion seeking interim costs?

Reasoning:

(1) No. Two competing principles are at play in respect of the Father’s request for an order compelling the Mother to attend for cross-examination on her affidavit. On the one hand, there is a prima facie right of a party to cross-examine an affiant. However, the court retains an inherent power to control its own process. Consequently, in cases where it appears to be in the interests of justice, a court may refuse to permit such cross-examination or restrict its scope: Re Ferguson and Imax Systems Corp. (1984), 47 O.R. (2d) 225 (Div. Ct.). On the other hand, a court may decline to entertain a request by a party to invoke its assistance where the party is not in compliance with an order of the court: Dickie v. Dickie, 2007 SCC 8.

In the present case, the Father has not complied with the an order for disclosure (Disclosure Order). He has not made any documentary production, nor has he served an affidavit explaining why he cannot or when he will. While the Father is seeking to vary the Disclosure Order, but that does not change the fact that he has not complied with it. Full and prompt financial disclosure is a key element of Ontario’s family law regime. The failure to comply with court-ordered disclosure is a most serious matter. Given these circumstances, the motion judge was not prepared to accede to the Father’s request for an order compelling the Mother to attend for cross-examination on her affidavit.

College of Physicians and Surgeons of Ontario v. Peirovy, 2018 ONCA 420

[Rouleau, Benotto and Roberts JJ.A.]

Counsel:

W. Niels, F. Ortved, D.M. Porter, and J. Katz, for the appellant

E. Widner and R. Ainsworth, for the respondent

Keywords: Administrative Law, Regulated Professions, Doctors, Professional Discipline, Standard of Review, Reasonableness, Penalty, R. v. Chase, [1987] 2 S.C.R. 293

Facts:

This decision is an appeal from the order of the Divisional Court, reversing a decision of the Ontario College of Physicians and Surgeons Discipline Committee.

The appellant, Dr. P, was found guilty of professional misconduct by the Discipline Committee of the College of Physicians and Surgeons (“the Discipline Committee”). He appeals from the order of the Divisional Court, which overturned the penalty imposed on him by the Discipline Committee, and remitted the penalty decision to the Discipline Committee for reconsideration.

The Divisional Court allowed the College’s appeal. While acknowledging that the Discipline Committee’s decision on penalty was subject to deference, the Divisional Court determined that the penalty imposed was unreasonable on the bases submitted by the College.

Dr. P was granted leave to appeal the Divisional Court’s decision. He submits that it should be set aside and the Discipline Committee’s penalty be reinstated.

Decision Below – Liability

In the liability phase of the hearing, the Discipline Committee heard from the various complainants and Dr. P. The allegations included claims that while examining patients with a stethoscope, he cupped patients’ breasts, touched patients’ nipples, placed his stethoscope directly on patients’ nipples and in one instance “tweaked” or squeezed a patient’s nipple.

The Discipline Committee accepted the evidence of the four complainants as to the inappropriateness of the touching, finding that their description of what had occurred was inconsistent with a misunderstanding. The Discipline Committee concluded that the allegations had been made out, that the touching was deliberate and that there was no consent from the patients or clinical reason for Dr. P to have touched them in that manner.

Relying on the Supreme Court of Canada’s decision in R. v. Chase, [1987] 2 S.C.R. 293, the Discipline Committee concluded that, even in the absence of a finding as to Dr. P’s motivation, a finding of sexual abuse could be made where the touching in question was objectively a violation of a patient’s sexual integrity.

The Discipline Committee therefore found Dr. P guilty of sexual abuse in relation to the four patients. In each case, the abusive conduct consisted of medically unnecessary touching of the breast or nipples of the patients during medically required chest examinations conducted using a stethoscope.

The Discipline Committee also found that Dr. P had asked a fifth patient out on a date immediately following his medical examination of her during which her breasts were exposed. While not found to be sexual abuse, that conduct, as well as the four sexual abuse incidents, constituted disgraceful, dishonourable and unprofessional conduct.

The Discipline Committee was also informed that Dr. P had pleaded guilty to simple assault of two of the complainants in relation to these same incidents. These convictions, for which Dr. P received a conditional discharge, were considered relevant to his suitability to practice. The Discipline Committee also considered these convictions to be professional misconduct.

Decision Below – Penalty

The Discipline Committee accepted the expert evidence of Dr. Rootenberg that Dr. P did not meet the diagnostic criteria for psychopathology or sexual deviance, which, he testified, is relevant with respect to relapse and prevention. The Discipline Committee also accepted the expert evidence that the risk of Dr. P re-offending by committing further sexual transgressions in the future was low.

Dr. Martin’s expert evidence was relevant to the issues of remediation and risk management that the Discipline Committee was required to consider in determining the appropriate penalty. She highlighted deficits in Dr. P’s interactive skills with patients that give rise to the same risk factors of misunderstanding by patients outlined by the experts who testified at the liability hearing. However, the Discipline Committee also accepted Dr. Martin’s opinion that Dr. P had made good progress in remedying the deficits identified while working with him from August 2013 to June 2015.

The Discipline Committee then explained that the fact that four patients had been subjected to sexual abuse in fairly close succession was an aggravating factor. Based on the expert evidence, it declined however to infer that this was indicative of “predatory intent or uncontrollable deviant urges on Dr. P’s part”. It is at this point that the Discipline Committee posited another possible inference that could explain why there were four patients abused in close succession:

Another possible inference is that this pattern reflects a physician who was genuinely and completely unaware of the ways in which his behaviour in relation to his patients was, in fact, abusive.

It is this quote that the Divisional Court cites as demonstrating that the Discipline Committee made an unreasonable finding that contradicted the findings it made at the liability stage.

The Discipline Committee ultimately suspended Dr. P’s licence for six months. He was ordered to submit to a reprimand, and required to pay $64,240 for the victims’ therapy costs and $35,680 in costs of the proceedings. He was also ordered to continue undergoing individualized instruction with Dr. Martin focused on consent, boundaries, and doctor-patient communications, and to complete a clinical education program focused on physical examinations.

A number of restrictions were also imposed on Dr. P’s return to practice, such as being prohibited from engaging in any encounter with female patients except under the supervision of a practice monitor approved by the College.

Issues:

(1) Did the Divisional Court err in concluding that the Discipline Committee made inconsistent findings of fact warranting intervention?

(2) Did the Divisional Court err in determining that the penalty imposed by the Discipline Committee was manifestly unfit?

Holding: Appeal allowed.

Reasoning:

Majority – Rouleau J.A. and Roberts J.A.

(1) Yes. The court stated that the Divisional Court correctly selected and articulated the reasonableness standard of review. However, the Divisional Court failed to properly apply the reasonableness standard. Instead, it incorrectly substituted its own assessments of the evidence and penalty for those of the Discipline Committee.

The Divisional Court found the Discipline Committee’s penalty decision to be unreasonable because it was based on inconsistent findings of fact. Specifically, it rejected the Discipline Committee’s suggestion that Dr. P’s unawareness as to how his behavior was abusive could possibly explain the abuse of four patients.

This “possible inference” of unawareness drawn by the Discipline Committee was, in the Divisional Court’s view, inconsistent with the finding of fact that there were several offences. More importantly, the inference was considered inconsistent with the Discipline Committee’s finding at the liability stage that Dr. P had touched the complainants in a way that an objective observer would find to be sexual and which the complainants described as “blatantly sexual”.

The court found that there are several problems with the Divisional Court’s concern. First, the Discipline Committee’s finding is well supported by the testimony of the experts. This includes the College’s expert at the liability hearing, who testified that touching a female patient’s nipple with either the hand or the stethoscope during a lung examination should be avoided because it is medically unnecessary and could be misinterpreted. In addition, the finding is supported by the Discipline Committee’s assessment of Dr. P’s testimony. Finally, the Discipline Committee did not, as the Divisional Court suggests, find that Dr. P’s awkward, unskilled and non-empathic manner was the only cause; it simply opined that it was a factor.

The Divisional Court advanced a second basis for rejecting the Discipline Committee’s suggestion that the several counts of sexual abuse could possibly be explained by Dr. P’s genuine and complete unawareness of the ways in which his behaviour was abusive. In the Divisional Court’s view, such an inference is inconsistent with Dr. P having been found guilty of criminal assault on two of the complainants.

The court held that this basis is also flawed. The Discipline Committee’s possible inference is not inconsistent with a finding of guilt for simple assault. Simple assault contemplates an unwanted touching. The Discipline Committee found that Dr. P deliberately touched the complainants in areas that were medically unjustified and that the complainants had not consented to the touching. This is sufficient to support the simple assault convictions. A sexual motivation need not be proven to support a conviction for simple assault.

Thus, the court held that while the Divisional Court chose the correct standard of review, it erred in its understanding of the evidence and of the reasons of the Discipline Committee, and it effectively sought to retry the case in a manner inconsistent with the proper application of the standard of review.

(2) Yes. The court stated that there were several reasons why the Divisional Court’s analysis was flawed regarding the issue of whether the Discipline Committee imposed an unfit penalty.

First, it misunderstood the Discipline Committee’s reasons and misapplied the reasonableness standard of review. As the Divisional Court properly stated, “a penalty decision of such a tribunal is at the heart of its discretion and is due great deference”. Nevertheless, the Divisional Court in effect simply substituted its view of what might constitute an appropriate penalty and did not defer to the Discipline Committee’s decision as was required. Furthermore, the penalty imposed was not manifestly unfit but represented the Discipline Committee’s careful consideration of all relevant factors and was within the range of reasonable outcomes.

To be overturned by a reviewing court, the Discipline Committee must have made an error in principle or the penalty must be “clearly unfit”. To be clearly unfit, the penalty must fall outside of the range of reasonableness. The Discipline Committee considered a number of its previous decisions involving the sexual abuse of patients. The factual scenarios in those cases were, like the present case, disturbing. However, they showed that the penalty imposed on Dr. P was in line with those that have been imposed in Ontario.

The penalty imposed by the Discipline Committee was carefully tailored to the circumstances of this case, and fit comfortably within the range of penalties imposed in other similar or more serious cases of sexual abuse of patients. It was based on forensic psychiatric evidence accepted by the Discipline Committee as well as the evidence it heard during the liability phase. It also took into account the progress shown by Dr. P in addressing some of the concerns. Further, following the lodging of the complaints, Dr. P had practiced with supervision for about five years without any incident.

Thus, the court allowed the appeal and restored the penalty imposed by the Discipline Committee.

Benotto J.A., dissenting, agreed with the majority that the correct standard of review was applied, but did not agree that the Divisional Court erred in its application. She would have dismissed the appeal.

Rahaman v. Fiscia, 2018 ONCA 418

[LaForme, Watt and Nordheimer JJ.A.]

Counsel:

H. Sarros, for the appellants

J. R. Smith, for the respondents

Keywords: Contracts, Real Property, Debtor-Creditor, Civil Procedure, Applications, Rules of Civil Procedure, Rule 2.01

Facts:

The appellants appeal from the judgment of the application judge who ordered them to pay to the respondents the sum of $120,000.

The parties are two individuals and their respective corporations. They had entered into an agreement by which the appellants were to sell a property to the respondents. Concurrent with these events, the appellants had borrowed the sum of $120,000 from the respondents. Those monies were to be repaid through the closing of the sale of the property.

The sale of the property did not go according to plan. The first agreement of purchase and sale for the property was not completed. A second agreement of purchase and sale was entered into. At the same time, the appellant, F, signed an acknowledgment of the $120,000 loan on behalf of himself and his company. Some weeks later, F alone signed a promissory note respecting the $120,000 loan. This promissory note stipulated that $40,000 was to be applied as a deposit on the sale of the property and the remaining $80,000 was to be paid on the closing of the sale.

This sale of the property was also not completed, at least in part because the $40,000 was never paid by the appellants. The respondents brought an application seeking the return of the $120,000. The application judge granted that relief. In doing so, he rejected the position of the appellants that the entire sum of $120,000 was a deposit on the sale of the property and, since that transaction did not close, the appellants did not have to repay that amount since the deposit was forfeited.

Issues:

(1) Did the application judge err in granting relief to the respondents?

Holding: Appeal dismissed.

Reasoning:

(1) No. The court saw no error in the conclusion reached by the application judge. The evidence clearly established that the $120,000 was a loan that was to be repaid by the appellants, either through the sale of the property or directly, if the sale was not completed. Neither the loan acknowledgment nor the promissory note referred to the $120,000 as being a deposit.

The court also agreed with the application judge that it would have been better for this matter to have proceeded as an action upon which a summary judgment motion could have been brought. It was not the type of issue that ought have been dealt with by way of application. However, like the application judge, in the particular circumstances of this case, especially the lack of any real factual dispute, the court found that any technical error in the procedure followed was insufficient to undermine the result: Rule 2.01 of the Rules of Civil Procedure.

Yasin v. Ontario, 2018 ONCA 417

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

Counsel:

J. Currie, for the appellant

A. Armstrong, for the respondent

Keywords: Administrative Law, Vital Statistics Act, R.S.O. 1990, c. V.4, Jurisdiction, Remedies, Declarations, Civil Procedure, Necessary and Proper Parties

Facts:

The appellant brought an application in the Superior Court of Justice, naming Her Majesty the Queen in Right of the Province of Ontario as the respondent. He sought a declaration that his date of birth is January 1, 1951, rather than November 5, 1955. His application was dismissed.

In a brief endorsement, the application judge stated, without elaborating, that: (a) Her Majesty the Queen in Right of Ontario (“Ontario”) was not a proper party to the application; (b) the Superior Court of Justice has no jurisdiction to make the order sought; and (c) the appellant failed to prove his true date of birth, given his inconsistent statements.

It is not entirely clear what “inconsistent statements” the judge was referring to. Counsel for Ontario maintained that the application judge was correct: it is not a proper party to the proceeding because the only relevant Ontario statute is the Vital Statistics Act, R.S.O. 1990, c. V.4, which deals with the registration of births in Ontario or on board ships registered in Ontario. The Vital Statistics Act expressly does not apply to births outside Ontario. Ontario took no position on the substantive issues or merits of the appeal.

Issues:

(1) Did the application judge err by dismissing the application on the basis that Ontario was not a proper party?

(2) Should the Court of Appeal exercise its inherent jurisdiction to grant declaratory relief in this case?

Holding: Appeal dismissed.

Reasoning:

(1) No. In the absence of any request for relief that would affect Ontario, or any demonstrated interest of Ontario in the proceeding, the application judge properly dismissed the application.

(2) No. One would have thought that there was some administrative route available, short of a proceeding in the Court of Appeal, to either correct the birth date shown on the appellant’s Canadian identity documents or to satisfy Canada Revenue Agency of the appellant’s correct date of birth to enable him to obtain CPP benefits. Counsel did not point the court to any such mechanism. In the absence of more specific evidence as to how this matter has developed, it cannot be determined whether the appellant’s proper route is through administrative channels, judicial review or an application in the Superior Court for directions or other relief, including declaratory relief.

On a proper record, and with the proper parties before it, the court may have jurisdiction to make a declaration of the appellant’s birth date to enable him to obtain CPP benefits. Her Majesty the Queen in Right of Canada, represented by the Attorney General of Canada, would be a proper party to such proceedings. A proper record would include: (a) a statement by the appellant, under oath, setting out the reasons for seeking the order; (b) the disclosure of any public or other records that would be affected by the order; and (c) any other matter that could be affected by the order. This would enable the court to consider the implications of the order and to identify any other parties, which could include the Province of Ontario, who should receive notice of the application.

Jackson v. Stephen Durbin and Associates, 2018 ONCA 424

[Benotto, Brown and Miller JJ.A.]

Counsel:

S. Dewart and S. Bentley-Jacobs, for the appellant

M. G. Cochrane, for the respondent

Keywords: Contracts, Solicitor and Client, Illegality, Contingency Fee Agreements, Family Law, Solicitors Act, R.S.O. 1990, c. S. 15, s. 28.1(3)(b)

Facts:

The sole issue on appeal was whether a “Results Achieved Fee” charged by the appellant law firm in a family law matter is a prohibited contingency fee agreement under the Solicitors Act, R.S.O. 1990, c. S. 15 (the “Act”)

The respondent retained the appellant to represent him in family law litigation. The primary issue was the custody of the respondent’s 6-year old daughter. The respondent signed a retainer agreement outlining hourly rates, daily fees for court appearances and an automatic yearly increase of 15% with respect to those fees. The retainer agreement also provided for “an increase in fees in the event of a positive result achieved (“Results Achieved Fee”).  The respondent was awarded sole custody, half the proceeds of the sale of the matrimonial home and costs of $192,000. The appellant received $423,510.47 in trust representing the respondent’s share of the proceeds of sale from the matrimonial home plus the costs award. The appellant deducted $132,597.74 from the trust to satisfy the outstanding account. The appellant also unilaterally deducted a Results Achieved Fee of $72,433.24. It is unclear on the record how the appellant arrived at this amount. The trial judge concluded that the agreement at issue was a contingency fee agreement since, under the plain terms of the agreement, the solicitor would receive no fees for his services unless an amount was recovered.

Issues:

(1) Is the “Results Achieved Fee” for a family law matter a contingency fee agreement that is prohibited by the Act?

Holding: Appeal dismissed.

Reasoning:

(1) Yes. The Act was amended in 2004 to include the phrase “contingent, in whole or in part” on a successful outcome. Consequently, a premium or bonus added on to a lawyer’s fee is captured by the meaning of contingency fee agreement and is thus prohibited by s. 28.1(3)(b) of the Act. The Court of Appeal concluded that a contingency fee agreement is an agreement under which any part of a lawyer’s compensation is tied to the successful resolution of the matter for which the lawyer was retained. Section 28.1(3)(b) of the Act prohibits contingency fee agreements in respect of family law matters. Therefore, the Results Achieved Fee was prohibited by the Act.

Criminal Decisions:

R v. Forcillo, 2018 ONCA 402

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

Counsel:

M. Lacy, J. Wilkinson and B. Badali, for the appellant

H. Leibovich, S. Reid and M. Perlin, for the respondent

Keywords: Criminal Law, Attempted Murder, Defences, Lawful Use of Force, Criminal Code, s. 25, Self-defence, Criminal Code, s. 34, Fresh Evidence, Palmer v. The Queen, [1980] 1 S.C.R. 759, Sentencing, Mandatory Minimum Sentences, Canadian Charter of Rights and Freedoms

R v. Roberts, 2018 ONCA 411

[Laskin, Miller and Paciocco JJ.A.]

Counsel:

G. Lafontaine, for the appellant

M. Fawcett, for the respondent

Keywords: Criminal Law, Impaired Driving Causing Bodily Harm, Evidence, Credibility, Canadian Charter of Rights and Freedoms, sections 8 and 10(a)

R v. Ahmed, 2018 ONCA 426

[LaForme, Watt and Nordheimer JJ.A.]

Counsel:

J. Foy, for the appellant

A. Derwa, for the respondent

Keywords: Criminal Law, Fraud, Breach of Trust, Sentencing, Denunciation and Deterrence, Principle of Restraint, Parity Principle, R. v. Lacasse, 2015 SCC 64

Short Civil Decisions:

Sub-Prime Mortgage Corporation v. Cedeno, 2018 ONCA 408

[Strathy C.J.O., Watt and Epstein JJ.A.]

Counsel:

D. Paul, for the appellant

G. E. Cohen, for the respondent

Keywords: Real Property, Mortgages, Default Judgments, Fresh Evidence

Albanese v. Franklin, 2018 ONCA 431

[MacPherson, Hourigan and Benotto JJ.A.]

Counsel:

M. A. Hoy, for the appellant

M. Cruickshank, for the respondents

Keywords: Unlawful Arrest, R. v. Lohnes, [1991] 1 S.C.R. 167

Correia v. Pinto, 2018 ONCA 382

[Hourigan, Benotto and Fairburn JJ.A.]

Counsel:

S. Mandalagiri, for the appellant

E. Upenieks and A. Kwok, for the respondents

Keywords: Appeal Book Endorsement, Trial List

Chinese Publications for Canadian Libraries Ltd. v. Markham (City), 2018 ONCA 413

[Doherty and Pepall JJ.A. and Gray J. (ad hoc)]

Counsel:

Q. Li Cao, for the plaintiff (appellant)

D. G. Boghosian and M. Fish, for the defendants (respondents)

Keywords: Civil Procedure, Summary Judgment, Procedural Fairness, Costs

2363523 Ontario Inc. v. Nowack, 2018 ONCA 414

[Rouleau, Pardu and Paciocco JJ.A.]

Counsel:

P. Slansky, for the moving party

N. Groot, for the responding party

Keywords: Civil Procedure, Security for Costs, Evidence of Impecuniosity

Caron c. Perrier, 2018 ONCA 422

[Les juges Rouleau, van Rensburg et Pardu]

Counsel:

A. Bluteau, for the appellant

J. Guindon, for the respondent

Keywords: Procédure Civile, Ordonnances, Outrage au Tribunal, Fraude

Caron c. Perrier, 2018 ONCA 423

[Les juges Rouleau, van Rensburg et Pardu]

Counsel:

A. Bluteau, for the appellant

J. Guindon, for the respondent

Keywords: Procédure Civile, Motion, Remise de L’Appel, Contre-Interrogatoire

 

 

ONTARIO COURT OF APPEAL SUMMARIES (APRIL 23 – APRIL 27, 2018)

Good evening.

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

Topics covered this week included two procedural fairness decisions (one relating to interpreting a contract in a way neither party argued, the other relating to the effect of a lengthy adjournment mid-trial), repair and storage liens in the automobile insurance context, the tort of conversion, as well as several short procedural decisions.

I wanted to take this opportunity to thank all of our readers, across all the various platforms on which this blog is available, for helping us build an extensive and expanding following. We are receiving many thousands of reads and visitors a month across all platforms. I also would like to update you on where you can find our content, and on our plans for improving the reader experience.

Since we started a few years ago, our blog has been available through our blog’s website (where followers can sign up to receive weekly Friday emails), CanLII, the OBA, Mondaq and Lexology. It is also available through our firm’s Twitter feed (@blaneymcmurtry) and on our firm’s LinkedIn page. The blog is now also available through my personal LinkedIn page (for anyone who wishes to connect with me), and on my personal Twitter feed (@jpolyzogopoulos) for anyone who may want to follow me on Twitter.

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Thank you again to everyone for taking an interest in our blog and wishing you all a nice weekend.

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

Table of Contents:

2237446 Ontario Inc. (409 Collision Centre) v. Intact Insurance, 2018 ONCA 394

Keywords: Contracts, Bailment, Repair and Storage Liens Act, R.S.O. 1990, c. R.25, s. 24, Subrogation, Insurance Act, R.S.O. 1990, c. I.8, s. 278

Danilova v. Nikityuk, 2018 ONCA 403

Keywords: Civil Procedure, Evidence, Credibility, Collusion, Procedural Fairness, Adjournments, Prejudice

Union Building Corporation of Canada v. Markham Woodmills Development Inc., 2018 ONCA 401

Keywords:  Real Property, Contracts, Agreements of Purchase and Sale of Land, Interpretation, Standard of Review, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Procedural Fairness, Labatt Brewing Co. v. NHL Enterprises Canada L.P., 2011 ONCA 511, Moore v. Sweet, 2017 ONCA 182, Rodaro v. Royal Bank of Canada (2002), 59 O.R. (3d) 74 (C.A.)

For Short Civil Decisions click here.

For Criminal Decisions click here.

For Ontario Review Board Decisions click here.

Civil Decisions

2237446 Ontario Inc. (409 Collision Centre) v. Intact Insurance, 2018 ONCA 394

[Hourigan, Huscroft and Nordheimer JJ.A.]

Counsel:

M A Klaiman, for the appellant

L M Carr, for the respondents

Keywords: Contracts, Bailment, Repair and Storage Liens Act, R.S.O. 1990, c. R.25, s. 24, Subrogation, Insurance Act, R.S.O. 1990, c. I.8, s. 278

Facts:

The applicant appeals from the dismissal of its application to have the initial certificate that was obtained by the respondent, Intact Insurance, under s. 24(5) of the Repair and Storage Liens Act, R.S.O. 1990, c. R.25 (“RSLA”) declared null and void.

On December 20, 2015, a motor vehicle owned by the respondent, BB, was involved in an accident. It was towed to the storage premises operated by the appellant. On January 6, 2016, Brennan executed a Vehicle Repair and Storage Agreement in which she agreed to pay a storage rate of $85.00 per day. Under her automobile insurance policy, Intact was obliged to reimburse BB for the storage costs.

Intact and the appellant could not agree on the storage charges that were properly due for the storage of the vehicle. Consequently, Intact applied for and received an initial certificate under s. 24 of the RSLA. By virtue of s. 24(6) of the RSLA, once Intact gave the initial certificate to the appellant, the appellant was obliged, within three days of receiving the initial certificate, to release the article described therein to Intact unless, within that period, it filed a notice of objection with the court.

Rather than filing a notice of objection, the appellant brought this application to have the initial certificate declared null and void. The appellant asserted that, since Intact had not paid Brennan for the value of the vehicle, Intact was not, at that time, either the owner of the vehicle, nor was it “any other person entitled to” the vehicle under s. 24(1) of the RSLA. Hence, according to the appellant, Intact was not entitled to obtain the initial certificate.

The application judge found that Intact had “assumed liability” under the contract of insurance and was then subrogated to the rights of its insured under s. 278 of the Insurance Act, R.S.O. 1990, c. I.8. The application judge proceeded from this finding to conclude that Intact was a “person lawfully entitled to” the automobile and thus had the right to obtain an initial certificate under s. 24 of the RSLA.

Issues:

(1) Did the application judge err in dismissing the application to have the insured’s initial certificate declared null and void?

Holding: Appeal dismissed.

Reasoning:

(1) No. It is obvious that the intent of the RSLA is to provide an expeditious procedure for dealing with disputes over storage charges that protects both the storage holder and the owner of the item stored. The interpretation that the appellant argues for would effectively require insurers to settle all matters arising out of a motor vehicle accident with its insured, and make the resulting payment, before it would be able to avail itself of the remedies under the RSLA. In the interim, storage charges would continue to accumulate. That interpretation is not one that is harmonious with the object of the RSLA. It is also not one that reflects the realities of the marketplace, in which this statute operates. There will be many occasions where issues will arise between an insured and an insurer under an automobile insurance policy. It would not be to the benefit of either the insured or the insurer to have charges relating to the storage of motor vehicles involved in accidents mount up while those issues are resolved.

Danilova v. Nikityuk, 2018 ONCA 403

[Doherty and Pepall JJ.A. and Gray J. (ad hoc)]

Counsel:

A M Chapman and J Mor, for the appellants

A Dhillon and L Loader, for the respondents, AN and VN

A M Mae and W Thomson for the respondents, YS and YMCA Simcoe/Muskoka

Keywords: Civil Procedure, Evidence, Credibility, Collusion, Procedural Fairness, Adjournments, Prejudice

Facts:

The appellants raise three grounds of appeal. Two concern the trial judge’s credibility assessments and the third alleges prejudice resulting from a five-month adjournment in the course of the trial proceedings.

Issues:

(1) Did the trial judge prefer the evidence of the respondents over the appellants in a peremptory manner that failed to demonstrate the basis upon which the trial judge’s credibility determinations were made?

(2) Was there evidence that one of the respondents colluded with three witnesses called by the YMCA in respect of their evidence?

(3) Did the adjournment of the trial cause serious prejudice to the appellants, effectively denying them meaningful access to justice?

Holding: Appeal dismissed.

Reasoning:

(1) No. Counsel relied on a single passage in para. 59 of the reasons for judgment. It is true that para. 59 is conclusory, however, that paragraph must be read in the context of the entire judgment. Throughout the judgment, the trial judge made findings of fact that amply justified the trial judge’s ultimate credibility findings and fully explained to the reader the reasons for that finding. Read as a whole, the reasons adequately explain the trial judge’s findings.

(2) No. The record does not offer any evidentiary support for a collusion finding. It is difficult to find collusion in a situation in which the “will-says” said to be prepared by one of the respondents, one of the alleged colluders, are inconsistent in material respects with the evidence given by witnesses who are said to have colluded with YS. We observe that, in some cases, the version of events in the “will-says” were more favourable to the respondents but in at least one case, the “will-says” were more favourable to the appellants.

(3) No. No actual prejudice has been demonstrated by the appellants and in this case none can be assumed merely from the length of the adjournment.

Union Building Corporation of Canada v. Markham Woodmills Development Inc., 2018 ONCA 401

[Hourigan, Huscroft and Nordheimer JJ.A.]

Counsel:

B Zarnett and F Kussner, for the appellant

G J. Tighe and B R Michelson, for the respondent

Keywords:  Real Property, Contracts, Agreements of Purchase and Sale of Land, Interpretation, Standard of Review, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Procedural Fairness, Labatt Brewing Co. v. NHL Enterprises Canada L.P., 2011 ONCA 511, Moore v. Sweet, 2017 ONCA 182, Rodaro v. Royal Bank of Canada (2002), 59 O.R. (3d) 74 (C.A.)

Facts:

By an Agreement of Purchase and Sale made in July 2015 (the “APS”), the appellant agreed to sell to the respondent an undeveloped 3.6 acre parcel of land for a sale price of $3,960,000. The land was zoned agricultural and was part of a larger 19.29 acre parcel of land owned by the appellant in the City of Markham (the “City”). The respondent wished to purchase the land so that it could develop it for its head office. The APS contained a provision, clause 17, making the sale conditional upon the City consenting to a severance of the land being sold to the respondent from the larger parcel owned by the appellant, pursuant to s. 50 of the Planning Act, R.S.O. 1990, c. P.13. Clause 17 provided that the appellant would seek the severance and satisfy any conditions the City imposed, except for conditions that were “onerous or unreasonable”. In the event the City imposed an onerous or unreasonable condition, clause 17 provided that the appellant could give the respondent the opportunity to satisfy such severance condition. If the respondent chose not to do so, then the APS would be null and void.

The severance was obtained by the appellant but it was made subject to certain conditions. One of the severance conditions that the City imposed was to require the appellant to enter into the Cathedral West Cost Sharing Agreement (the “Cost Sharing Agreement”) – a private agreement among other landowners in the area who were developing, or had developed, their lands. The appellant had no intention of developing its property and had not previously entered into the Cost Sharing Agreement. One aspect of entering into the Cost Sharing Agreement was that the appellant would have to fund development-related costs in the amount of $407,582.

The appellant took the position that this severance condition was onerous or unreasonable under clause 17. The appellant invoked its rights under clause 17 and gave the respondent the option to satisfy the severance condition. The respondent disagreed that the severance condition was onerous or unreasonable. It took the position that clause 17 required the appellant to satisfy the condition. However, in order to prevent the APS from floundering on this issue, the respondent agreed to pay the $407,582 necessary to satisfy the severance condition but reserved its rights to seek that amount back from the appellant. On that basis, the purchase of the property closed.

The respondent then brought the underlying application to the Superior Court of Justice for a determination that the appellant was required to pay the $407,582 that the respondent had paid to satisfy the severance condition. Rather than interpreting the wording of clause 17, as was suggested in the Notice of Application, the application judge interpreted clause 19.  The respondent did not advance an argument based on clause 19 in its pleadings. The application judge observed that clause 19 of the APS required the amended zoning to be in full force and effect at the time of closing. However, the amended zoning, as passed by the City, had a “hold” in place. The “hold” would be lifted once there was compliance with the Cost Sharing Agreement and payment of the accompanying obligations. The application judge concluded that the amended zoning was not “in full force and effect” until that payment was made. Consequently, he found the appellant was required to bear the costs and granted the application.

Issues:

(1) Did the application judge err in his interpretation of the APS?

Holding: Appeal allowed.

Reasoning:

(1) Yes. In a normal situation, an application judge’s interpretation of a non-standard form contract is entitled to deference. Accordingly, on an appeal from a judicial decision, the interpretation of a non-standard form contract is normally reviewable only for palpable and overriding error unless there is an extricable question of law. However, natural justice overtakes questions of contractual interpretation where a judge decides a proceeding on a basis that was not anchored in the pleadings, evidence, positions or submissions of the parties. In this case, the parties proceeded before the application judge for a determination of their respective rights based on the interpretation of clause 17 of the APS. There is also not a single mention of clause 19 in the Notice of Application, nor is there any mention of the zoning issue generally. The application judge’s decision to dispose of the application on a basis that was not advanced by the parties amounts to a denial of procedural fairness.

The Court of Appeal decided to reach its own determination on the interpretation of clause 17 pursuant to its powers under section 134(1)(a) of the Courts of Justice Act, R.S.O. 1990, c. C.43, rather than remit it to a new application judge.

Clause 17 permits the appellant to refuse to comply with a condition of severance that is onerous or unreasonable. The application judge made brief reference at the tail end of his reasons to the fact that, while the $407,582 that had to be paid under the Cost Sharing Agreement was approximately 10.3% of the $3,960,000 sale price, there was no evidence as to the percentage that the $407,582 represented in terms of the profit the appellant would make on the sale of the property. The Court of Appeal found that this was not the appropriate test to be applied in determining whether the amount to be paid under the Cost Sharing Agreement was onerous or unreasonable under clause 17. In fact, the Court of Appeal found that it was not the onerous exception that applied to the payment, but the unreasonable exception. What rendered the payment unreasonable, in these circumstances, was the fact that the appellant never had any intention of developing this property. It was selling the property. It was the respondent that wished to develop the property.

Reasonableness must be interpreted objectively. On the application, there was ample objective evidence demonstrating that a reasonable person would not consider the requirement that a vendor of undeveloped land pay the costs associated with the future development of the land to be a reasonable interpretation of the APS. The Court of Appeal found, therefore, that the requirement that the Cost Sharing Agreement be entered into, with the requisite $407,582 payment in order to obtain the severance, was an unreasonable one for the appellant to bear. As a result the Court of Appeal allowed the appeal and dismissed the application.

Short Civil Decisions

Gravelle (CodePro Manufacturing) v. Denis Grigoras Law Office, 2018 ONCA 396

[Hourigan, Huscroft and Nordheimer JJ.A.]

Counsel:

Gordon Gravelle, acting in person

B Hardick, for the respondents

Keywords: Civil Procedure, Limitation Periods, Discoverability, Arbitration, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B., s. 4

Weenen v. Biadi, 2018 ONCA 393

[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: Civil Procedure, Costs, Solicitors’ Liens, Charging Orders, Solicitors Act, R.S.O. 1990, c. S.15, s. 34(1)

665750 Ontario Inc. v. Atlantic Towing Inc., 2018 ONCA 397

[Benotto, Brown and Miller JJ.A.]

Counsel:

S N Zeitz, for the appellant

T Robinson and R Blumberg, for the respondent

Keywords: Torts, Conversion, Unjust Enrichment, Damages

Schnarr v. Blue Mountain Resorts Limited, 2018 ONCA 400

[Doherty, Brown and Nordheimer JJ.A.]

Counsel:

J A Olah, for the appellant, Blue Mountain Resorts Limited

E Chadderton and J Beleskey, for the respondents/appellants by cross-appeal, Snow Valley Resorts (1987) Ltd. Aka Snow Valley (Barrie), Snow Valley Barrie, Snow Valley Ski Resort, Snow Valley, and 717350 Ontario Ltd. (collectively, “Snow Valley”)

P J Pape, S Chaudhury, and E Rankin, for the respondent, and for the appellant/respondent by cross-appeal

Keywords: Endorsement, Costs, Partial Indemnity, Public Interest Litigation, Odhavji Estate v. Woodhouse, 2003 SCC 69

Ernst & Young Inc. v. Essar Global Fund Limited, 2018 ONCA 405

[Blair*, Pepall and van Rensburg JJ.A.]

Counsel:

P D S Jackson, A Gray, J R Opolsky, A Shelley and D Shiff, for the appellants Essar Global Fund Limited, New Trinity Coal, Inc., Essar Ports Algoma Holding Inc., Algoma Port Holding Company Inc., Port of Algoma Inc., and Essar Steel Limited

C P Prophet, N Kluge and D Contractor, for the respondent Ernst & Young Inc. in its capacity as Monitor of Essar Steel Algoma Inc. et al.

E Kolers and P Corney, for the respondent Essar Steel Algoma Inc.

P H Griffin, M Jilesen, R Trenker and K Nusbaum, for the appellants GIP Primus, L.P. and Brightwood Loan Services LLC

Keywords: Endorsement, Costs, Partial Indemnity, Joint or Several Liability

Criminal Decisions

R v. G.C. (Publication Ban), 2018 ONCA 392

[Rouleau, Tulloch and Fairburn JJ.A.]

Counsel:

G.C., in person

E Chozik, duty counsel

D Calderwood, for the respondent

Keywords: Criminal Law, Incest, Sexual Assault, Ineffective Assistance of Counsel, R v. Stark, 2017 ONCA 148, R v. Khan, 2001 SCC 86

R v. Walters, 2018 ONCA 391 

[Rouleau, Tulloch and Fairburn JJ.A.]

Counsel:

Donald Charles Walter, in person

E Chozik, duty counsel

G J Tweney, for the respondent

Keywords: Criminal Law, Dangerous Offenders, Criminal Harassment, Failure to Comply with Probation Orders,  Criminal Code, s. 753(1)(a)(i), R v. Walters, 2012 ONSC 3567, Sentencing, R v. Boutilier, 2017 SCC  64, [2017] 2 S.C.R. 936

R v. M.B. (Publication Ban), 2018 ONCA 399

[Feldman, Roberts and Trotter JJ.A.]

Counsel:

M Halfyard and B Vandebeek, for the appellant

N Dennison, for the respondent

Keywords: Criminal Law, Sexual Assault, Evidence, Credibility

Review Board Decisions

Carangay (Re), 2018 ONCA 395

[Hoy A.C.J.O., Sharpe and Nordheimer JJ.A.]

Counsel:

R Browne, for the appellant

C Elmasry, for the Crown

Keywords: Criminal Law, Not Criminally Responsible, Ontario Review Board, Significant Threat to the Safety of the Public, Conditional Discharge

Leuschner (Re), 2018 ONCA 398 

[Hoy A.C.J.O., Sharpe and Nordheimer JJ.A.]

Counsel:

A Szigeti, for the appellant

J Epstein, for the respondent, the Attorney General of Ontario

M Warner, for the respondent, the Person in Charge of the Centre for Addiction and Mental Health

Keywords: Criminal Law, Ontario Review Board, Not Criminally Responsible, Assault, Failure to Appear, Breach of Recognizance, Significant Risk to the Public, R v. Ferguson, 2010 ONCA 810

Mott (Re), 2018 ONCA 404

[Strathy C.J.O., Watt and Epstein JJ.A]

Counsel:

J Fernandes, for the appellant

K Doherty, for the respondent the Attorney General of Ontario

J A Zamprogna Ballès, for the respondent the Southwest Centre for Forensic Mental Health Care, St. Joseph’s Health Care London

Keywords: Criminal Law, Theft, Not Criminally Responsible, Ontario Review Board, Significant Risk to the Public, Kelly (Re), 2015 ONCA 95

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 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

For Short Civil Decisions click here

For Criminal Decisions click here

For Ontario Review Board Decisions click here

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

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.