COURT OF APPEAL SUMMARIES (JUNE 20, 2022 – JUNE 24, 2022)

By John Polyzogopoulos on June 26, 2022

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Good afternoon.

These are our summaries of the civil decisions of the Ontario Court of Appeal for the week of June 20. It was a busy week.

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In Elementary Teachers Federation of Ontario v. York Region District School Board, the Court determined that public school teachers are protected from unreasonable search and seizure by their principal. The principal had accessed communications between teachers that were critical of the principal, who they believed gave preferential treatment to a colleague. The comments were saved in one of the teacher’s private and password-protected Google accounts. The comments formed the basis for the imposition of discipline. The Court allowed the appeal and quashed the award of the arbitrator, who had found no breach of privacy.

In Bowman v Ontario, the Court determined that the certification judge erred in dismissing the appellants’ certification motion in its entirety. The Court found that it was not plain and obvious that the claim that Ontario’s early termination of its basic income program constituted a breach of contract would fail. That claim disclosed a reasonable cause of action pursuant to s. 5(1)(a) of the Class Proceedings Act, and should have been certified. However, the other claims of breach of undertaking, negligence, breach of a public law duty, and breach of s. 7 of the Canadian Charter of Rights and Freedoms were rightly not certified, as they did not disclose a reasonable cause of action.

In Intact Insurance Company v Zurich Insurance Company Ltd, Intact paid for environmental remediation on behalf of its insured beyond the policy limits. It sought to recover the overpayment from others who were subject to a remediation order under section 93 of the Environmental Protection Act, and their insurer, Zurich. The Court dismissed the appeal, finding that Intact did not have a claim under section 99 of the EPA. Moreover, there was no unjust enrichment, as it was Intact’s insured that was enriched, not the respondents.

In Selkirk v Ontario (Health and Long-Term Care), the appellant’s husband died of an alcohol-related liver disease and was not eligible for a transplant under the transplant regime. She unsuccessfully challenged the regime. Her appeal was mostly dismissed, although her standing to represent her husband’s Estate on the application and on the appeal was upheld. The Court did set aside the application judge’s finding that the current transplant regime was not subject to Charter scrutiny, without affirming or reversing the application judge on this issue. In partial dissent, Justice Lauwers would not have granted the appellant standing.

In Kiselman v. Klerer, the Court confirmed that a claim to arrears of rent and damage to the premises by a residential landlord against a former tenant can only be brought in court and not before the Landlord and Tenant Board. The Landlord and Tenant Board, which has exclusive jurisdiction during the currency of the tenancy, loses all jurisdiction once the tenant vacates the premises.

Other topics covered this week included oversight of a claims process in a class proceeding, stay pending leave to appeal in the context of regulated professions (doctors), debtor-creditor and setting aside a dismissal for delay.

Wishing everyone an enjoyable weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Civil Decisions

***Elementary Teachers Federation of Ontario v. York Region District School Board*, 2022 ONCA 476**

Keywords: Labour Law, Workplace Grievance, Breach of Privacy, Education Law, Administrative Law, Judicial Review, Standard of Review, Constitutional Law, Freedom from Unreasonable Search and Seizure, Canadian Charter of Rights and Freedoms, s. 8, Education Act, R.S.O. 1990, c. E.2, s. 265, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 109(1), s. 24(1), R. v. Cole, 2012 SCC 53, Doré v. Barreau du Québec, 2012 SCC 12, Longueépée v. University of Waterloo, 2020 ONCA 830, Agraira v. Canada (Public Safety and Emergency Preparedness), 2013 SCC 36, Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, R. v. Shepherd, 2009 SCC 35, Chamberlain v. Surrey School District No. 36, 2002 SCC 86, R. v. M. (M.R.), [1998] 3 S.C.R. 393, R. v. McKinlay Transport Ltd., [1990] 1 S.C.R. 627, Comité paritaire de l’industrie de la chemise v. Potash, [1994] 2 S.C.R. 406, R. v. Edwards, [1996] 1 S.C.R. 128, R. v. Tessling, 2004 SCC 67, R. v. Marakah, 2017 SCC 59, R. v. A.M., 2008 SCC 19, R. v. Plant, [1993] 3 S.C.R. 281, R. v. Jarvis, 2019 SCC 10, Hunter et al. v. Southam Inc., [1984] 2 S.C.R. 145, Chris Hunt and Micah Rankin, “R. v. Spencer: Anonymity, the Rule of Law, and the Shrivelling of the Biographical Core” (2015) 61 McGill L.J. 193

Akhavan v. Taheri, 2022 ONCA 483

Keywords: Contracts, Debtor-Creditor, Promissory Notes, Civil Procedure, Trials, Evidence, Discovery Evidence, John W. Morden & Paul M. Perell, The Law of Civil Procedure in Ontario, 4th ed., (LexisNexis: Toronto, 2020)

Philbert v. Graham , 2022 ONCA 488

Keywords: Civil Procedure, Appeals, Dismissal for Delay, Setting Aside, Frivolous, Vexatious and Abuse of Process, Rules of Civil Procedure, Rule 2.1.01, Paulsson v University of Illinois, 2010 ONCA 21, Kudrocova v Kronberger, 2021 ONCA 563

Kiselman v. Klerer, 2022 ONCA 489

Keywords: Real Property, Residential Tenancies, Damages, Arrears of Rent, Damage to Premises, Civil Procedure, Small Claims Court, Jurisdiction, Administrative Law, Landlord Tenant and Board, Jurisdiction, Residential Tenancies Act, 2006, SO 2006 c. 17, Courts of Justice Act, RSO 1990, c. C.43, 1162994 Ontario Inc. v. Bakker, 2004 CanLII 59995 (Ont. C.A.), Capreit Limited Partnership v. Griffin, 2016 ONSC 5150 (Div. Ct.), Kissell v. Milosevic, 2008 CanLII 27475 (Ont. Div. Ct.), Finney v. Cepovski, 2015 CanLII 48918 (Ont. S.C.), Fong v. Lemieux, 2016 CanLII 30092 (Ont. S.C.)

Intact Insurance Company v Zurich Insurance Company Ltd., 2022 ONCA 485

Keywords: Environmental Law, Statutory Liability, Duty to Remediate, Remedies, Damages, Section 99 EPA Damages, Remediation Costs, Unjust Enrichment, Insurance Law, Indemnification, Policy Limits, Environmental Protection Act, RSO. 1990, c. E.19, ss 1(1), 3, 93, 99(1)(2)(a)(b)(4)(8), 99(3)(7)(8), 100(4), Canada Trustco Mortgage Co. v Canada, 2005 SCC 54, Castonguay Blasting Ltd. v Ontario (Environment), 2013 SCC 52, Midwest Properties Ltd. V Thordarson, 2015 ONCA 819, MVL Leasing Ltd. V CCI Group Inc., 2018 ONSC 1800, Moore v Sweet, 2018 SCC 52, Sez-A-Me-Inc. v Drewlo Holdings Inc., 2018 ONSC 7670, Rogers Communications Partnership v. Society of Composers, Authors and Music Publishers of Canada, 2016 FCA 28, Garland v Consumers’ Gas Co., 2004 SCC 25, Peel (Regional Municipality) v Canada; Peel (Regional Municipality) v Ontario, [1992] 3 SCR 762, Grover v Hodgins, 2011 ONCA 72, Birkett v Astris Energi Inc. (2004), 45 BLR (3d) 293 (Ont. CA), Accuworx Inc. v Enroute Imports Inc., 2016 ONCA 161

Bowman v. Ontario, 2022 ONCA 477

Keywords: Crown Liability, Breach of Contract, Breach of Undertaking, Torts, Negligence, Breach of a Public Law Duty, Charter Claims, Civil Procedure, Class Proceedings, Certification, No Reasonable Cause of Action, Appeals, Standard of Review, Class Proceedings Act, 1992, S.O. 1992, c. 6, ss. 5(1), Crown Liability and Proceedings Act, 2019, R.S.C., 1985, c. C-50, ss 11(4), Canadian Charter of Rights and Freedoms, ss 7, 24(1), Bowman et al. v. Her Majesty the Queen, 2019 ONSC 1064, 58 Admin. L.R. (6th) 327 (Div. Ct.)., Hollick v. Toronto (City), 2001 SCC 68, Pioneer Corp. v. Godfrey, 2019 SCC 42, Shah v. LG Chem Ltd., 2018 ONCA 819, Fehr v. Sun Life Assurance Company of Canada, 2018 ONCA 718, The Catalyst Capital Group Inc. v. Dundee Kilmer Developments Limited Partnership, 2020 ONCA 272, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Ontario Public Service Employees Union v. Ontario (2005), 13 C.P.C. (6th) 178 (Ont. S.C.), Nelson (City) v. Marchi, 2021 SCC 41, Francis v. Ontario, 2021 ONCA 197, Wright v. Horizons ETFS Management (Canada) Inc., 2020 ONCA 337, McGee v. Farazli, 2020 ONSC 7066 (Div. Ct.)

Selkirk v Ontario (Health and Long-Term Care), 2022 ONCA 478

Keywords: Health Law, Constitutional Law, Civil Procedure, Parties, Standing, Self-Represented Litigant, Canadian Charter of Rights and Freedoms, sections 7, 12, & 15, Rules of Civil Procedure, Rules 2.03, 9.01 & 15.01, Canada (Attorney General) v. Downtown Eastside Sex Workers United Against Violence Society, 2012 SCC 45, Thorson v. Canada (Attorney General), [1975] 1 S.C.R. 138, Nova Scotia (Board of Censors) v. McNeil, [1976] 2 S.C.R. 265, Canada (Minister of Justice) v. Borowski, [1981] 2 S.C.R. 575, Ernst v Alberta Energy Regulator, 2017 SC 1, Bogaerts v. Ontario (Attorney General), 2019 ONCA 876, Barendregt v. Grebliunas, 2022 SCC 22, Allen v. Alberta, 2015 ABCA 277, Grant v. Winnipeg Regional Health Authority, 2015 MBCA 44, Canada (Attorney General) v. Bedford, 2013 SCC 72, Carter v. Canada (Attorney General), 2015 SCC 5, R. v. Smith, 2015 SCC 34, New Brunswick (Minister of Health and Community Services) v. G. (J.), [1999] 3 S.C.R. 46, R. v. Palmer, [1980] 1 S.C.R. 759, Public School Boards’ Association of Alberta v. Alberta (Attorney General), [2000] 1 S.C.R. 44, R. v. Powley (2001), 53 O.R. (3d) 35 (C.A.), Sengmueller v. Sengmueller (1994), 17 O.R. (3d) 208 (C.A.)

Fanshawe College of Applied Arts and Technology v. Hitachi, Ltd., 2022 ONCA 480

Keywords: Civil Procedure, Class Proceedings, Claims Process, Administration, Review, Class Proceedings Act, 1992, SO 1992, c 6, s 12, Canada (Attorney General) v Fontaine, 2017 SCC 47, BancroftSnell v Visa Canada Corp., 2016 ONCA 896

Thirlwell v. College of Physicians and Surgeons of Ontario, 2022 ONCA 494

Keywords: Administrative Law, Judicial Review, Regulated Professions, Physicians and Surgeons, Competence, Professional Misconduct, Civil Procedure, Leave to Appeal, Stay Pending Leave, Health Professions Procedural Code, being Schedule 2 to the Regulated Health Professions Act, 1991, SO 1991, c 18, s 25.4, Rules of Civil Procedure, Rule 63.02, Zafar v Saiyid, 2017 ONCA 919, M & M Homes Inc. v. 2088556 Ontario Inc, 2020 ONCA 134, Fontaine v Canada (Attorney General), 2012 ONCA 206, Morguard Residential v Mandel, 2017 ONCA 177, Iness v Canada Mortgage and Housing Corp. (2002), 220 D.L.R. (4th) 682 (Ont. C.A.), J.P.B. v C.B., 2016 ONCA 996, Sazant v The College of Physicians and Surgeons of Ontario, 2011 CarswellOnt 15914 (Ont. C.A.)

Short Civil Decisions

Letwin v. Camp Mart, 2022 ONCA 475

Keywords: Contracts, Torts, Negligence, Civil Procedure, Evidence

Street v. Toronto (Police Services Board), 2022 ONCA 486

Keywords: Torts, Assault, Civil Procedure, Appeals, Evidence, Canadian Charter of Rights and Freedoms, Palmer v. The Queen, [1980] 1 S.C.R. 759

De Havilland Aircraft of Canada Limited v. Dias, 2022 ONCA 491

Keywords: Labour Law, Unions, Civil Procedure, Injunctions

Anthony v. Vinczer, 2022 ONCA 493

Keywords: Real Property, Contracts, Duty of Good Faith, Mortgages, Committee for Justice and Liberty v. National Energy Board, [1978] 1 S.C.R. 369, Yukon Francophone School Board, Education Area #23 v. Yukon (Attorney General), 2015 SCC 25

CIVIL DECISIONS

Elementary Teachers Federation of Ontario v. York Region District School Board, 2022 ONCA 476

[Doherty, Benotto and Huscroft JJ.A.]

Counsel:

H. Goldblatt and D. Sheppard, for the appellant

M. Hines, P. Murray and L. Campbell, for the respondent

facts:

Ms. R and Ms. S (the “grievors”) were two teachers employed on contracts at Mount Joy Public School in the York Region. They believed one of the other teachers was receiving preferential treatment from the school principal. They kept a log of their concerns on Ms. S’s private Google account. The private communications on their personal, password-protected log were read and captured by screenshots taken by their school principal, and then used by the respondent school board to discipline them.

The union grieved the discipline. It sought to have the reprimands rescinded and sought $15,000 in damages for each of the grievors for breach of their privacy rights. The grievance proceeded to arbitration in accordance with the terms of the collective agreement. The arbitrator found that Ms. S had a diminished expectation of privacy, and the grievors’ reasonable expectation of privacy was not breached. The Divisional Court concluded that the issue was not rendered moot by the removal of the discipline from the grievors’ records and ordered an application for judicial review of the tribunal decision.

issue:

Did the labour relations arbitrator err in interpreting and applying s. 8 of the Canadian Charter of Rights and Freedoms and did the arbitrator reach an unreasonable decision in dismissing the grievance?

holding:

Appeal allowed.

reasoning:

Yes.

The factual findings of the arbitrator were entitled to deference, but whether the grievors had a reasonable expectation of privacy is a question of law that is subject to review for correctness: R. v. Shepherd. The Court determined that s. 8 applied to the actions of the principal and the school board. The protection of s. 8 is not limited to the criminal and quasi-criminal law context: see e.g., R. v. McKinlay Transport Ltd.

Whether a person has a reasonable expectation of privacy is a normative question: it requires the evaluation of a person’s legitimate interests to determine whether they should be given priority over competing interests. The determination is necessarily a value-laden inquiry that is conducted in fact-specific circumstances.

The key question is whether an expectation of privacy is objectively reasonable, and that is informed by several non-exhaustive considerations:

the location of the search;
whether the subject matter was in public view;
whether the subject matter was abandoned;
whether the information was already in the hands of third parties, and if so, whether it was subject to an obligation of confidentiality;
whether the investigative technique was intrusive in relation to the privacy interest;
whether the investigative technique itself was objectively unreasonable; and
whether the information exposed any intimate details of the claimant’s lifestyle, or information of a biographical nature.

That the grievors had a subjective expectation of privacy in the contents of their personal conversations is clear. The grievors did all that they could to protect the privacy of their communications. Their log was at all times password protected and reserved to their use. The grievors had every reason to expect that their conversation was, and would remain, private. The grievors’ subjective expectation of privacy was objectively reasonable and deserving of protection. The objective reasonableness of an expectation of privacy is determined having regard to the potential for personal information to be revealed, not whether the information revealed is in fact personal: R. v. Marakah. Whether information is considered part of the “biographical core” of a claimant is not determinative of the objective reasonableness of an expectation of privacy. The arbitrator’s conclusion that the log was left in “plain sight” and that the grievors had only a diminished expectation of privacy as a result skewed her analysis of the reasonableness of the search.

The statutory authority for the search was s. 265 of the Education Act, which prescribes the duties of school principals. These provisions establish authority in principals to make decisions in a wide range of circumstances governing students and staff alike. The rationale in M. (M.R.) supporting the authority of principals to search students suggests that this power may seldom be exercised with teachers, and the nature of the search permitted will be limited. M. (M.R.) counsels flexibility and consideration of all the circumstances in determining whether a search and seizure is reasonable. School authorities such as principals are not responsible for the welfare of teachers and staff in the same way as students, and the need to act quickly concerning teachers and staff is less likely to arise. Concerns arising out of employment relationships in the workplace are unlikely to justify a similarly broad and flexible search and seizure authority.

It is not possible to prescribe the circumstances in which a search and seizure will be reasonable in workplaces governed by the Charter. Workplaces differ dramatically, and whether a reasonable expectation of privacy exists depends on the unique circumstances of each case. The principal failed to respect the grievors’ reasonable expectation of privacy. The grievors were within their rights to be judgmental – to criticize the school, their fellow employees, and the principal in their private communications. Their private thoughts were not to be mined by the school principal to address his employment relations concerns.

In summary, the arbitrator erred in interpreting and applying the law concerning the grievors’ s. 8 rights and reached an unreasonable decision. The majority of the Divisional Court erred in asserting that the grievors did not have the right to the protection of s. 8 in their workplace and erred in asserting that the arbitrator’s decision was subject to two levels of deference. The principal’s actions in reading the log, taking screenshots of it, and sending it to the Board violated the grievors’ reasonable expectation of privacy and constituted an unreasonable search under s. 8.

Akhavan v. Taheri, 2022 ONCA 483

[Brown, Roberts, and Paciocco JJ.A.]

Counsel:

J. Heller, for the appellant

R. Flom, for the respondent

facts:

The appellant appealed the judgment ordering him to pay the respondent in respect of loans made to the appellant which were evidenced by promissory notes. The trial judge found that the June Note and July Note evidenced two separate loans and rendered judgment accordingly.

issues:

(1) Did the trial judge err in principle in reaching her conclusion that there were two separate loans evidenced by two different promissory notes, instead of one loan?

(2) Should the judgment be set aside on the basis that the poor quality of the trial transcript prevented proper appellate review?

holding:

Appeal dismissed.

reasoning:

(1) No.

The Court concluded that there was no merit to the complaint that the trial judge tainted her credibility findings by not sharing with counsel during trial her interest calculations. The trial judge’s calculations were simple arithmetic, and she fully explained how she performed her calculations. The trial judge was fully alive to: the limits of the documentary record; the issue of the lack of production of certain bank records, the language of replacement on the face of the notes; the difference between the respondent’s evidence on discovery and at trial; and the implications of the difficulties encountered in cross-examining the appellant.

The appellant further submitted that the trial judge erred by failing to use portions of his examination for discovery that were read in at trial by plaintiff’s counsel. The Court concluded that the appellant’s submission ignored the entirety of the passage from the appellant’s discovery read in at trial by the plaintiff’s counsel. A party reading in evidence from the adverse party’s examination for discovery is not precluded from adducing other evidence that may rebut discovery evidence that the party reads in. The evidence read in becomes part of the totality of the evidence available for the trial judge to consider. The Court concluded that the appellant had not pointed to any basis for appellate interference with those findings: that the trial judge’s reasons did not disclose a palpable and overriding error of fact, an error in principle in her credibility-finding process, any misapprehension of the evidence or an unreasonable interpretation of the language of the notes.

(2) No.

The appellant did not attempt to link any alleged errors in the trial judge’s finding of fact or credibility to areas of the transcript where the reporter could not decipher the audio recording. Nor had the appellant demonstrated that the indecipherable portions likely contained evidence that would call into question findings made by the trial judge. The Court determined that this was an argument in the air, made without an adequate foundation. In the specific circumstances of this case, the particular deficiencies that did exist in the transcript did not prevent appellate review of the grounds of appeal advanced by the appellant, nor did they cause a substantial wrong or miscarriage or justice that would require a new trial.

Philbert v Graham, 2022 ONCA 488

[George J.A. (Motion Judge)]

Counsel:

E. P., acting in person

K. Gordon, for the responding party

facts:

The appellant and respondent were once neighbours. The respondent is a lawyer employed by the Department of Justice. The appellant alleged, amongst other things, that the respondent has harassed, defamed, surveilled, and attempted to kidnap her.

The appellant commenced four actions against the respondent, three of which were dismissed pursuant to Rule 2.1.01 of the Rules of Civil Procedure as being frivolous, vexatious or an abuse of process.

The appellant brought three motions to the Court. She, first, sought to extend the time to perfect her appeal of Steele J.’s order, which was dismissed by Thorburn J.A. on February 9, 2022. The appellant then brought a motion to have Thorburn J.A.’s decision reviewed by a panel of the Court, which was dismissed by the Registrar for failing to perfect it in time. The appellant then moved to set aside the Registrar’s dismissal, which was the current issue before the Court.

The appellant argued that she did file her motion in time; did so according to the Rules; and that, therefore, the Registrar should not have dismissed it.

issue:

Should the appellant’s request to set aside the Registrar’s dismissal be set aside?

holding:

Motion dismissed.

reasoning:

No.

A judge’s decision to set aside or vary a decision of the Registrar is discretionary. The Court was not confined to determining whether the Registrar’s decision was correctly made or not. When determining whether to set aside a Registrar’s decision to dismiss for delay, the following factors should be considered:

i) whether the appellant had an intention to appeal within the time for bringing an appeal;
ii) the length of the delay and any explanation for the delay;
iii) any prejudice to the respondent caused by the delay; and
iv) the justice of the case.

The overriding consideration on a motion to set aside a dismissal order is the justice of the case, which should involve an assessment of the appeal’s merits.

There was no question that the appellant had an intention to seek a review of Thorburn J.A.’s order before the deadline. The Court suspected that she instantly formed that intention upon receipt of the decision. Further, there was no prejudice to the respondent caused by the delay.

The length of the delay was minimal. The appellant delivered a motion record to the court late in the evening on April 5, 2022, which was the extended deadline to perfect the motion, although this was at best a neutral factor, given that the motion record was not served on the respondent and did not contain an affidavit in support of her motion, as required by Rules 61.16(4)(a) and 37.10(2)(c) of the Rules of Civil Procedure.

The appellant’s explanation appeared to be that the Court and the respondent were causing the delay, including by blocking her emails. The Court was not satisfied with her explanation for failing to perfect, as the Registrar of the Court was communicating with her, and the appellant was aware of alternative means for effecting service on the respondent other than by email, and had before delivered materials to the respondent by registered mail.

Regardless, the Court dismissed the motion because to grant it would not be in the interests of justice, as there was no merit to the appeal. An assessment of the appeal’s merits required consideration of whether it had any real chance of success. In that respect, both Steele J. of the Superior Court, and Thorburn J.A., had determined that the appellant’s claims were frivolous and vexatious.

As the claim was devoid of merit and had no chance of success, the justice of the case required dismissing the motion.

Kiselman v. Klerer, 2022 ONCA 489

[Brown, Roberts and Paciocco JJ.A.]

Counsel:

J. R. Forget, for the appellant

D. Krysik, for the respondent

E. Fellman, for the intervener Landlord and Tenant Board

Keywords: Real Property, Residential Tenancies, Damages, Arrears of Rent, Damage to Premises, Civil Procedure, Small Claims Court, Jurisdiction, Administrative Law, Landlord Tenant and Board, Jurisdiction, Residential Tenancies Act, 2006, SO 2006 c. 17,Courts of Justice Act, RSO 1990, c. C.43, 1162994 Ontario Inc. v. Bakker, 2004 CanLII 59995 (Ont. C.A.), Capreit Limited Partnership v. Griffin, 2016 ONSC 5150 (Div. Ct.), Kissell v. Milosevic, 2008 CanLII 27475 (Ont. Div. Ct.), Finney v. Cepovski, 2015 CanLII 48918 (Ont. S.C.), Fong v. Lemieux, 2016 CanLII 30092 (Ont. S.C.)

facts:

The appellant, U.K., commenced a Small Claims Court claim against the respondents, his former residential tenants. The claim was for $17,166.55 in total damages for the non-payment of rent, and for costs incurred to repair undue damage that the appellant alleged the respondents caused to the rental unit. A deputy Small Claims Court judge dismissed the claim for want of jurisdiction. That decision was upheld on appeal to the Divisional Court. Leave to appeal the Divisional Court decision was granted.

issue:

Did the Division Court appeal judge err in holding that the Landlord and Tenant Board (“LTB”) had exclusive jurisdiction and dismissing the appeal?

holding:

Appeal allowed.

reasoning:

Yes.

In order to have exclusive jurisdiction, a tribunal must first have jurisdiction. The LTB did not have jurisdiction to adjudicate the claims that the appellant was seeking to advance, let alone exclusive jurisdiction. At the relevant time, ss. 87(1) and 89(1) of the Residential Tenancies Act, now repealed and replaced, provided that the LTB only had jurisdiction over a claim for the payment of rent, or for the recovery of the costs of repairing damage, when the tenant is in possession of the rental unit. In 1162994 Ontario Inc. v. Bakker, Doherty J.A. held with respect to the identically worded predecessor provisions to s. 87(1) that the LTB does not have jurisdiction over claims for arrears of rent where the connection between the tenant and the rental unit has been severed. Bakker has not been overturned and has been repeatedly followed, including by the Divisional Court: see Capreit Limited Partnership v. Griffin; Kissell v. Milosevic.

The Court disagreed with the respondents’ argument that Bakker does not apply and their reliance on certain Small Claims Court decisions, including Finney v. Cepovski and Fong v. Lemieux. The line of authority the respondents relied upon was inconsistent with the clear language of former ss. 87(1) and 89(1) and should not be followed. That erroneous line of authority was also inconsistent with the clear language of s. 23 of the Courts of Justice Act, which describes the jurisdiction of the Small Claims Court based not on the exercise of due diligence but on the monetary amount of a claim. Moreover, although Bakker dealt only with claims for rent arrears, its reasoning applies to the former s. 89(1) relating to damage claims for undue damage to the rental unit. Given that the respondents had moved out and severed their connection to the rental unit, the LTB did not have jurisdiction, let alone exclusive jurisdiction over this litigation. Instead, the claims fell within the monetary jurisdiction of the Small Claims Court.

Intact Insurance Company v. Zurich Insurance Company Ltd., 2022 ONCA 485

[Simmons, Harvison Young and Zarnett JJ.A.]

Counsel:

T. Farber and M. Dusseault, for the appellant

F. Csathy and C. Afonso, for the respondents

facts:

The appellant, Intact Insurance Company, was the insurer of a transportation company. A truck owned by Intact’s insured, and operated by one of its employees, overturned while carrying a shipment of liquid formaldehyde. The formaldehyde was released onto residential lands and into a municipal water supply. Liquid formaldehyde is a pollutant within the meaning of the Environmental Protection Act, R.S.O. 1990, c. E.19 (“EPA”). Under s. 93 of the EPA, the person with control of the pollutant and the owner of the pollutant at the time of the environmental spill was responsible to eliminate the adverse effects of the spill and restore the environment (the “duty to remediate”). Intact’s insured, was subject to a s. 93 duty to remediate. In fulfillment of its policy obligations to its insured, Intact made payments toward remediation efforts. But Intact claims it went further than its policy obligations. Intact’s payments exceeded the financial limits of its policy by about $2.9 million.

Instead, Intact claimed a right to recover the $2.9 million in excess payments from the respondents, and their insurer, Zurich. The respondents were the company whose liquid formaldehyde was being shipped, the company to whom it was being shipped, and the company that had arranged the shipment – each of whom was also under a s. 93 EPA duty to remediate. Intact asserted that it had its own right of action to recover the payments from the respondents under s. 99(2)(a) of the EPA.

issue:

Can Intact recover, by direct action against persons other than its own insured, amounts it paid in excess of its policy limits for the remediation of an environmental spill in which the insured was involved?

holding:

Appeal dismissed.

reasoning:

No.

Intact did not have a right of action to recover its excess payments from the respondents under s. 99(2)(a) of the EPA. Nor did the doctrine of unjust enrichment permit such recovery. Intact argued that the motion judge erred in law about liability under the EPA and about the application of the doctrine of unjust enrichment. At the heart of Intact’s position was the proposition that Intact should have been viewed separately from its insured because the excess payments were not made to fulfill a policy obligation to its insured, and no other legal obligation required it to make the excess payments. The Court agreed with the respondents that Intact’s excess payments did not qualify for compensation under s. 99(2)(a) of the EPA. Nor was there a basis, in these circumstances, for an unjust enrichment claim.

(A) s 99(2)(a) claim

Although Intact’s payments exceeded its policy limits, the excess payments were not completely unconnected to Intact’s position as TDB’s insurer. The EPA limits and controls the rights as between persons with s. 93 duties to remediate – one way in which it does so is to require a s. 99(2) claim by such a person to be reduced by the extent of that person’s fault. Recognizing Intact’s claim as one that could be brought under s. 99(2)(a), and thus allowing Intact to avoid any deduction for any fault of its insured, would be inconsistent with these important aspects of the statutory scheme.

The EPA is entitled to “a generous interpretation” following “an expansive approach”. Its intended reach is “wide and deep”. The s. 99(2) remedy did not require the plaintiff to prove fault or negligence on the part of the defendant to the claim. Section 99 does provide a defence to compensation claims for persons who establish that they took reasonable care, but only in respect of certain types of claims. Importantly though, it states that any fault or negligence of the s. 99(2) plaintiff is to be taken into account in reduction of their claim.

The Court’s leading decision on s. 99(2) was Midwest Properties. Midwest was an illustration of how a s. 99(2)(a) claim could include a claim for expenses of remediation. The Court held that a claim under s. 99(2)(a) by a property owner was not restricted to recovery of diminution in property value caused by an environmental spill; it may include recovery of the costs of remediating the property. The only parties who can be liable under s. 99(2) are the owner of the pollutant and the person who had control of it at the time of the spill. Zurich did not come within that definition. Accordingly, there could be no s. 99(2) claim against Zurich.

When Intact’s payments reached the policy limits, it ceased to be under any obligation to its insured under the policy with respect to remediation costs. It had no other legal duty to remediate. The spill and its effects, and the failure of the respondents to begin to fund remediation, at that point had no direct bearing on Intact’s legal interests. Intact could have chosen to make no further payments.

(B) Unjust Enrichment Claim
As the Supreme Court stated in Moore v Sweet, to succeed in a claim for unjust enrichment, a plaintiff must show that: (a) the defendant was enriched; (b) the plaintiff suffered a corresponding deprivation; and (c) the defendant’s enrichment and the plaintiff’s corresponding deprivation occurred in the absence of a juristic reason. In the motion judge’s view, the enriched party – the true beneficiary of any excess payments – was Intact’s own insured, TDB. Intact argued that its excess payments constituted a “negative” benefit; the respondents were spared an expense they would otherwise have been required to undertake. Intact also argued that the motion judge’s juristic reason analysis was flawed because the EPA did not require a transfer of wealth by it for the benefit of the respondents, and because the motion judge should have found that Intact did not share Zurich’s expectation and that Zurich’s expectation was unreasonable.

The Court did not interfere with the motion judge’s conclusion that an unjust enrichment remedy is not available to Intact in these circumstances. The motion judge’s finding that it was TDB who benefited from Intact’s payments was sufficient to dispose of the unjust enrichment claim. Since a benefit to the defendant had not been established, an unjust enrichment claim failed without the need for a juristic reason analysis. The doctrine of unjust enrichment applies “when a defendant receives a benefit from a plaintiff in circumstances where it would be ‘against all conscience’ for him or her to retain that benefit”. Given the voluntary nature of Intact’s payments, and the reasonable expectations of Intact and Zurich, the doctrine did not assist Intact here.

Bowman v. Ontario, 2022 ONCA 477

[Pepall, Brown and Coroza JJ.A.]

Counsel:

S. Moreau, L. Koerner-Yeo and K. Duff, for the appellant

C.P. Thompson, C. Blom, Z. Green, R. Amarnath and A. Mortimer, for the respondents

facts:

In 2017, the appellants enrolled in Ontario’s basic income (“BI”) program and received BI payments, which was set to expire in 3 years. Following an election and a change in government, in July 2018, Ontario announced that it planned to terminate the BI Program before three years had elapsed. Final payments were made in March 2019 to those who had enrolled in the BI Program. Prior to the final payment date, the appellants initiated in the Divisional Court an application for judicial review to quash the decision to cancel the BI Program. The Court dismissed the application, stating that a government cannot be required by the court to make or continue to fund an expenditure, as the distribution of government funds is a political, not a judicial, function. The appellants subsequently commenced a proceeding against Ontario under the Class Proceedings Act (“CPA”).

The appellants sought damages for the wrongful termination of the BI Program before the expiry of three years. The claims for damages sound in breach of contract, breach of undertaking, negligence, breach of a public law duty,1 and breach of s. 7 of the Canadian Charter of Rights and Freedoms. The damages sought included various financial obligations the appellants had assumed in reliance on the BI Program, including obtaining loans and enrolling in educational programs. The appellants moved under s. 5(1) of the CPA for certification of their action as a class proceeding and related relief, which Ontario opposed.

Regarding breach of contract, the appellants submitted that the certification judge exceeded the proper limits of the inquiry required by CPA s. 5(1)(a) in holding that their breach of contract claim did not disclose a cause of action. The certification judge held that the facts pleaded, as supplemented by the terms of those documents, did not support a contractual relationship. The BI Pilot was a social benefits program with a research component. In these circumstances, the certification judge held that it was plain and obvious that the statement of claim did not disclose a reasonable cause of action for breach of contract.

Regarding the breach of undertaking, the appellants relied on Ontario Public Service Employees Union v. Ontario (2005), where in that case, the plaintiffs’ pension plans were reorganized due to a change in government funding policies. The certification judge concluded the appellants’ reliance upon the OPSEU decision was misplaced and no cause of action for breach of undertaking as pleaded existed.

Regarding the claim in negligence, the appellants pleaded that the respondent foresaw that stopping BI payments would cause the Class members to suffer damage, and that the respondent breached its duty of care. The appellants relied on the two-stage Anns/Cooper test: 1) whether a prima facie duty of care exists between the parties; and 2) whether there are residual policy concerns outside the parties’ relationship that should negate the prima facie duty of care. Ontario argued that no cause of action could be asserted against it for the termination of the BI Program due to the immunity from suit provided by s. 11(4) of the Crown Liability and Proceedings Act, 2019, (“CLPA”), which states that “[n]o cause of action arises against the Crown … in respect of any negligence or failure to take reasonable care in the making of a decision in good faith respecting a policy matter …”. The certification judge was not persuaded by the appellants’ submission that only the government’s decision to initiate the BI Program constituted a policy decision for purposes of the Anns/Cooper test, whereas its decision to cease making the BI Payments was merely an operational one. The certification judge also rejected the appellants’ argument that the immunity from suit afforded by CLPA s. 11(4) did not extend to the cancellation of funding.

Regarding the applicants’ s. 7 Charter claims, the appellants pleaded that the respondent violated the basic human needs of the Class Members because the BI payments were essential to meet their daily needs. Further, the appellants stated that the class was entitled to damages per s 24(1) of the Charter. The certification judge concluded that it was plain and obvious the appellants’ claim under s. 7 of the Charter did not disclose a reasonable cause of action.

On November 30, 2020, the certification judge dismissed the appellants’ certification motion (the “Dismissal Order”). He concluded that the appellants’ Amended Claim did not disclose a reasonable cause of action and therefore failed to satisfy s. 5(1)(a) of the CPA. The appellants appealed.

issue:

Should the Dismissal Order be set aside and the appellants’ action be certified as a class proceeding?

holding:

Appeal allowed in part.

reasoning:

Yes. The Court stated that the principles regarding the certification of a class proceeding are well established. In Ontario, s. 5 of the CPA contains the criteria for certifying class actions. The CPA should be construed generously in a way that gives full effect to the benefits foreseen by the drafters: Hollick at para. 14-15. The onus is on the representative plaintiff to show why the certification criteria have been met. The plaintiff must show “some basis in fact” for each of the certification criteria, other than the requirement that the pleadings disclose a cause of action: Hollick, at paras. 25-26.

Standard of Review from Certification Decision

The Court stated that the standard of review on appeal for each particular certification question depended on the nature of the question: Pioneer Corp., at para. 28. Whether a plaintiff had a cause of action was a question of law reviewable on a standard of correctness: Pioneer Corp., at para. 57. Whether the certification judge had identified the appropriate standard for certifying loss as a common issue was also a question of law: Pioneer Corp., at para. 94. Otherwise, substantial deference was owed to a certification judge’s application of the test for certification and determination of the common issues. On such questions, appellate court intervention should be restricted to matters of general principle: Fehr, at para. 39.

The Court then noted the context in which a certification judge must conduct any CPA s. 5(1)(a) analysis. The Court stated that the test pursuant to CPA s. 5(1)(a) was merely that the statement of claim discloses a cause of action: Hollick at para 16. This has resulted in the adoption of the “plain and obvious” test. The Court noted that the inquiry under CPA s. 5(1)(a) sought to determine whether the facts pleaded (which are assumed to be true) are capable of supporting a claim at law – that is, whether they can support a cause of action. The Court further stated that this was not an inquiry into the factual merits of the claim but an inquiry into the legal tenability of the claim asserted that forms part of the larger s. 5(1) inquiry into the appropriate form the action should take – specifically, whether the suit was appropriately prosecuted as a class action.

Breach of Contract

Regarding the breach of contract, the Court noted that the task of the certification judge was not to determine whether the contract pleaded by the plaintiff was, in fact, formed and, if it was, the proper interpretation of the contract. Rather, the task of the certification judge was to ascertain whether it was plain and obvious that the facts pleaded by the plaintiff (which must be taken to be true) cannot support, at law, a cause of action for breach of contract. If that was not plain and obvious, then the plaintiff had satisfied the s. 5(1)(a) criterion. The determination of whether a contract was formed was considered a matter for another time. The Court stated that the certification judge lost sight of this distinction, as he examined whether the appellants had established that a contract had been formed between class members and Ontario instead of limiting his analysis to the application of the “plain and obvious” test. The Court concluded the certification judge over-stepped the proper boundaries of a CPA s. 5(1)(a) analysis, and thus, the certification judge erred in holding that the appellants’ Amended Claim did not disclose a cause of action for breach of contract for purposes of CPA s. 5(1)(a).

Breach of Undertaking

Regarding the breach of undertaking claim, the Court stated that in OPSEU, it had clarified a form of breach of contract claim, rather than permitted some sort of free-standing breach of undertaking claim to proceed. Accordingly, the Court concluded that the appellants’ pleaded breach of undertaking claim collapsed into, and was subsumed by, their claim for breach of contract. However, the appellants had not pointed to a body of jurisprudence that confirmed a claim akin to their breach of undertaking pleading. Therefore, the Court concluded that the certification judge did not err in finding that the appellants’ plea of breach of undertaking did not disclose a cause of action for purposes of CPA s. 5(1)(a).

Negligence

Regarding the claim in negligence, the Court stated Canadian jurisprudence had long recognized that a sphere of government decision-making, consisting of core policy decisions, should remain free from judicial supervision based on the standard of care in negligence: Nelson, at para. 2. At common law, core policy decisions were considered immune from negligence liability, as long as they are not irrational or made in bad faith: Nelson, at paras. 3, 41. Further, the Court noted that regardless of whether a plaintiff was asserting that a public authority owed it a duty of care under an established or analogous duty of care or a novel duty of care, it was open to the public authority to prove that the relevant government decision was a core policy decision immune from liability in negligence: Nelson, at paras. 24, 30. The Court noted that a public authority may raise core policy immunity in both existing/analogous or novel duty of care cases. Where the public authority does so, as in the present case, the Court emphasized that the key focus should be on the nature of the government decision in issue: Nelson, at paras. 2, 54. Accordingly, the Court noted the appellants’ suggestion that immunity for core policy decisions does not apply where a duty of care has been recognized in analogous cases was misplaced. The Court concluded that the certification judge properly examined the Amended Claim to ascertain the nature of the government decision in issue in the appellants’ negligence claim. Further, the Court found no error regarding the certification judge’s conclusion that Ontario relied upon Crown common law immunity.

Crown Immunity from Policy Decisions

Regarding the policy matter immunity under the CLPA, the appellants advanced one argument: if the application of the common law had led the Court to conclude that the appellants’ negligence claim was not doomed to fail, then the immunity from suit found in CLPA s. 11(4) was not available to Ontario per Francis v Ontario. The Court stated that the plain language of CLPA s. 11(4) provided clear support for the certification judge’s conclusion that Ontario’s decision to terminate the BI Program and cease making BI Payments constituted a “policy matter” in respect of which no cause of action arose. The Court further noted that the inclusion in CLPA s. 11(5)’s definition of “a policy matter” of “the funding of a program…including…ceasing to provide such funding” (s. 11(5)(b)(i)) and “the termination of a program” (s. 11(5)(d)) fits snugly with the common law’s conception of a pure policy decision.

The Court concluded that was no error in the certification judge’s holding that it was plain and obvious the Amended Claim did not disclose a cause of action in negligence against Ontario and, therefore, did not satisfy the criterion in CPA s. 5(1)(a).

Charter Claims

The Court then addressed the appellants’ Charter claims. The appellants submitted that their s. 7 claim should be allowed to proceed as it was not plain and obvious that the class members’ security of the person interests were not breached by the winding down and cessation of BI Payments in the special circumstances of the BI Program. They argued their Amended Claim pleaded that the cessation of BI Payments subjected class members to severe physical and psychological harms, which met the requisite level of seriousness for a s. 7 claim.

The Court stated the certification judge did not err in concluding that it was plain and obvious the appellants’ claim under s. 7 of the Charter did not disclose a cause of action. The Court noted that the result turned on the failure of the appellants to plead the required elements of a cause of action for breach of a s. 7 Charter right. Ultimately, because the appellants’ claims had not particularized the principle of fundamental justice at play regarding their s. 7 claim, their claim could not succeed.

The Court allowed the appeal in part, and set aside the Dismissal order. The Court further ordered that the Amended Claim disclosed a cause of action for breach of contract that satisfied s. 5(1)(a) of the CPA. Further issues were remitted by the Court to the certification judge.

Selkirk v Ontario (Health and Long-Term Care), 2022 ONCA 478

[Feldman, MacPherson, and Lauwers JJ.A.]

Counsel:

D.S., acting in person and for The Estate of Mark Selkirk

E. Krajewska, L. Crowell, and H. Webster, for the respondents

facts:

The appellant appealed the decision in which the application judge determined: (1) the challenge to the reasonableness of the six-month wait for transplant (the “Wait”) imposed on the appellant’s late husband, and on all patients with liver failure caused by alcohol (“ALD patients”) from 1991-2018 was moot; (2) the current Trillium Gift of Life Network (“TGLN”) liver transplant waitlist criteria (the “Criteria”) for ALD patients does not infringe sections 7, 12 and 15 of the Canadian Charter of Rights and Freedoms; and, (3) the current Living Donor Criteria established by the University Health Network (“UHN”) was not subject to Charter scrutiny.

The appellant’s husband died of an alcohol-related liver disease (“ALD”), and at the time of his death was not eligible for a transplant under UHN’s former transplant regime. The appellant challenged three transplant regimes. The first regime required that for liver transplants, the eligibility included a firm requirement that ALD patients abstain from alcohol use for six months prior to being placed on the waitlist. The second regime involved three general requirements that apply to everyone being considered for a liver transplant: (1) therapeutic options, other than liver transplant, have been exhausted; (2) there is an absence of obvious contraindication for transplant; and (3) the expected five-year survival post-transplant is greater than 60 percent. The third criterion involved the patient being carefully assessed for a higher risk of return to problematic alcohol use.

issues:

1. Did the appellant have standing to represent her spouse’s Estate in these proceedings?
2. Did the application judge err by concluding that the challenge with respect to the Wait imposed on appellant’s husband was moot?
3. Did the application judge err by concluding that the current Criteria for ALD patients do not infringe sections 7 and 15 of the Charter?
4. Did the application judge err by concluding that the current Living Donor Criteria established by UHN are not subject to Charter scrutiny?

holding:

Appeal allowed in part.

reasoning:

MacPherson J.A. (Feldman J.A. concurring):

1. Yes.

The Court concluded that even if it was possible that, technically speaking, the appellant’s representation of her husband’s Estate fell afoul of Rules 9.01 and 15.01 of the Rules of Civil Procedure, it was not regarded as a problem, for three primary reasons:

A) The respondents did not object to the representation in either the Superior Court of Justice or the Ontario Court of Appeal.
B) The principle that a non-lawyer should not act on behalf of beneficiaries when seeking money on their own behalf, was not engaged in this case.
C) The appellant’s representation of the Estate on the appeal, through her factum, supporting materials, and oral argument, was of high quality.

Therefore, the Court applied Rule 2.03 and said it was necessary in the interest of justice to dispense with strict compliance with the rules. In response to the concerns expressed by Lauwers J.A., the Court pointed out that the if the appellant’s competence to present the case was of concern to the application judge, she could have appointed an amicus. She did not because she did not feel this was necessary.

2. No.

The Court found that the application judge’s conclusion on this issue was entirely reasonable. The appellant’s husband, who was subject to the Wait, passed away in November 2010. The Wait was removed from the criteria for the allocation of scarce lives, first as part of a Pilot Program in May 2018 and then permanently in November 2020.

3. No.

The Court held that the application judge’s analysis of the Criteria under section 7, 12, and 15 of the Charter, was exemplary. The Criteria are informed by, and flow from, the current medical evidence. The Criteria, the approaches by the experts, and the approaches seen in the studies reviewed, all consider alcohol use because it is a medically relevant criterion when assessing the likely outcome of a liver transplant in a patient with ALD.

4. Declined to address this issue on appeal.

The Court concluded that it would only be appropriate to consider this issue in a case where there is a living donor and a living recipient, as the relationship between a living donor (usually a close relative or close friend) and a recipient is a very different relationship from the relationship between a deceased donor and a potential recipient. The Court therefore set aside the application judge’s determination of this issue, without either affirming or reversing the application judge’s reasons and conclusion on this issue.

Lauwers J.A. (dissenting):

1. No.

Lauwers J.A. noted that this complex and difficult case required the assistance of competent counsel. Lauwers J.A. held that the appellant was not able to muster sufficient evidence and argument to sustain her case, or to conduct effective cross-examination of the witness arrayed against her by the formidable legal teams representing the respondent.

The Court must consider three factors in exercising the discretion to grant public interest standing: (1) whether there is a serious justiciable issue raised; (2) whether the plaintiff has a real stake or a genuine interest in it; and (3) whether, in all circumstances the proposed suit is a reasonable and effective way to bring the issue before the courts. The application judge granted the appellant public interest standing respecting the preliminary issue of whether a Charter remedy was available to a deceased person or their estate under section 24(1).
Lauwers J.A. felt that the scope of the application judge’s analysis was too limited. Lauwers J.A. concluded that she made an error of law when she did not consider the factors from Canada (Attorney General) v. Downtown Eastside Sex Workers United Against Violence Society, in evaluating the appellant’s broader request for standing to challenge the Pilot Project and current eligibility criteria.

Lauwers J.A. further noted, that the determination of section 7 and section 15 Charter issues is exceptionally fact specific and nuanced, and would be difficult for a self-represented litigant, however able, to undertake. The appellant is not a lawyer and what she has learned of constitutional law has come from self-study and an unwavering dedication to her cause. The application judge noted that while the appellant’s skills are impressive, it would be unjust to demand procedural perfection from her, resulting in the application judge focusing on the substance of the issues and not their technical presentation.

Granting the appellant public interest standing contravened settled constitutional doctrine and despite the manifest good faith, the appellant lacked the personal capacity to present the case for judicial determination in an appropriate adversarial setting.

2. Yes.

3. Declined to address this issue on appeal.

Lauwers J.A. felt that the application judge’s finding that the current eligibility criteria for liver transplants for individuals who have alcohol-associated liver disease is constitutional under section 7 and section 15 of the Charter was profoundly premature.

4. Declined to address this issue on appeal.

Lauwers J.A. agreed with the majority that the appeal from the application judge’s determination on this issue should be set aside without affirming or reversing the application judge’s conclusion on this issue. Lauwers J.A. concluded that the case’s chronology shows that the issue determined definitely by the application judge was late to this litigation, and without proper adversarial testing. He held that neither the factual record nor the legal argument was adequate to address the complexity and importance of the constitutional issues this application raises. Lauwers J.A. was of the view that the Court must be especially deliberative and careful in deploying its authority to decide constitutional issues.

The appellant’s fresh evidence application arrived well after the application judge’s decision and just before the argument of this appeal. Lauwers J.A. noted that it is highly complex and does not speak for itself. Lauwers J.A. concluded that admitting the Study in this case would not respect the Supreme Court’s instructions in Brendregt v Grebliunas, 2022 SCC 22 (“Brendregt”), that the admission of additional evidence on appeal will be rare. Lauwers J.A. discussed that the concern in this case was different and more prosaic, but that Brendregt still had application because the Court needs expert assistance to fully understand the implications of the complex medical information in the Study as applied to the facts in this case.

Fanshawe College of Applied Arts and Technology v. Hitachi, Ltd., 2022 ONCA 480

[van Rensburg, Harvison Young and Copeland JJ.A.]

Counsel:

B. Harrison and P. Ramirez, for the appellant

B. Moran and L. Visser, for the respondent

facts:

This appeal arose out of the claims process following the settlement of a class proceeding dealing with price fixing in the cathode ray tube (“CRT”) market, which includes products like televisions and monitors. The appellant was Class Action Capital Recovery LLC (“CAC”), one of several third-party claims filers who had filed claims on behalf of certain class members.

As part of the CRT settlement, the parties, the class and the defendants agreed to a Distribution Protocol, which, together with the rest of the settlement agreement, was incorporated into court orders. The Distribution Protocol set out the procedure for class members to submit claims and for their determination by a Claims Administrator. The Distribution Protocol provided that once a claim is audited, the claimant must provide documentation to substantiate its purchases. Following the audit, the Claims Administrator issued Decision Notices and rejected 123 of the 125 claims filed by CAC on behalf of its clients. The Decision Notices did not explain the grounds for the rejections other than that the claimants “failed to provide adequate proof of purchase”.

CAC and other third-party filers appealed to the supervising judge on behalf of 258 settlement class members whose claims had been rejected. They challenged the Claims Administrator’s decision to reject claims for “[failing] to provide adequate proof of purchase”. Before the supervising judge, CAC argued that it had not received a deficiency notice before the claims were rejected, as required by s. 43 of the Distribution Protocol, and requested that the Claims Administrator “consider this additional material as if it was submitted in response to a deficiency notice”. The supervising judge ordered the Claims Administrator to reconsider any claim that was more than just a declaration. The Claims Administrator approved some of CAC’s claims, and upheld its rejection of other claims.

CAC asserted that, once it received the Reconsideration Notices, it should have been afforded the opportunity to provide additional documentation to prove the claims of the class members it represents.

issue:

Did the supervising judge err in refusing to give effect to the Deficiency Process set out in s. 43 of the Distribution Protocol?

holding:

Appeal dismissed.

reasoning:

A review of the record made the appellant’s argument clear – that the claims should be subject to further consideration, including under s. 43. In setting out the process for the Claims Administrator, the supervising judge did not refer to s. 43, however, resort to s. 43 was unnecessary in the circumstances.

The Distribution Protocol required the Claims Administrator to administer the protocol “under the ongoing authority and supervision of the Ontario Court”. Section 12 of the Class Proceedings Act, 1992 (“CPA”), provided that the court “may make any order it considers appropriate respecting the conduct of a proceeding under [the CPA] to ensure its fair and expeditious determination”, including imposing “such terms on the parties as it considers appropriate”. The supervising judge was equipped with the broad discretionary power of s. 12 during the settlement administration stage of the proceedings. The order he made in respect of the initial appeal was within his authority to resolve the issue before him – to ensure that the Claims Administrator properly considered the documents the third-party filers, including CAC, submitted in support of the claims of class members, including the additional documentation submitted during the appeal process.

The process ordered by the supervising judge was not unfair. CAC had the opportunity to provide supporting documents for the claims it was advancing. It was required to do so as a result of the audit process, and did so again once the appeal of the rejection of some claims was commenced. The supervising judge required the Claims Administrator to consider all of these documents as part of the reconsideration process. This was a reasonable and practical solution. Requiring the Deficiency Process under s. 43 to be followed at this stage would provide CAC with an opportunity that other claimants did not receive, and would further delay the process for distribution of the settlement funds to eligible class members.

Thirlwell v. College of Physicians and Surgeons of Ontario, 2022 ONCA 494

[George J.A. (Motion Judge)]

Counsel:

M. P. Falco and C. Pike, for the moving party

L. Brownstone, for the responding party

facts:

The moving party, Dr. CT, is a psychiatrist and member of the College of Physicians and Surgeons of Ontario (the “College”). In the fall of 2021, the College received reports that CT was providing improper medical exemption letters from COVID-19 vaccinations. On October 7, 2021, the Registrar of the College appointed investigators to look into whether CT had engaged in professional misconduct or was incompetent.

On November 5, 2021, the College’s Inquiries, Complaints and Reports Committee (the “ICRC”) met to consider this matter and ultimately issued an interim order imposing terms on CT’s registration pursuant to s 25.4 of the Health Professions Procedural Code. The ICRC determined that CT’s conduct exposed, or was likely to expose, patients to harm or injury. It found that CT’s special clinic, which sold exemptions for up to $300, suggested a generalized approach to vaccine exemptions for profit, and not an individualized assessment of each patient. The interim order also required CT to provide irrevocable consent “for the College to make appropriate enquiries of the Ontario Health Insurance Plan (“OHIP”), to monitor her compliance with the terms of the Order” (the “OHIP term”). Other terms were imposed including that she provide a log of all patient encounters and submit to unannounced inspections.

On November 8, 2021, CT’s counsel advised that she would accept all of the terms, except the OHIP term and the term which required her to be subject to unannounced inspections, which she requested the ICRC vary. On November 15, 2021, the ICRC reconvened but declined to vary its interim order, noting that while there was no OHIP billing code for vaccine exemptions, the OHIP and unannounced visit terms were necessary in order to monitor compliance. On November 18, 2021, CT commenced an application for judicial review in the Divisional Court and contested only the OHIP term. On May 10, 2022, the Divisional Court released its decision and dismissed CT’s application. The court held that the ICRC’s concerns were not speculative, but based on CT’s past conduct, and the public safety concerns warranted the OHIP term.

On May 25, 2022, CT brought a motion seeking leave to appeal the Divisional Court order. On June 3, 2022, CT brought this motion seeking to stay the order of the Divisional Court, pending the resolution of the motion for leave to appeal.

issue:

Should the Divisional Court order upholding the term requiring CT to consent to the College making inquiries of OHIP be stayed pending her motion for leave to appeal?

holding:

Motion dismissed.

reasoning:

No.

CT had the burden of demonstrating that a stay of the Divisional Court order pending appeal should be granted pursuant to Rule 63.02 of the Rules of Civil Procedure. The test for a stay of an order pending appeal required the court to consider these three factors:

i) a preliminary assessment must be made of the merits of the case to ensure that there is a serious question to be tried;
ii) it must be determined whether the applicant would suffer irreparable harm if the application were refused; and
iii) an assessment of the balance of convenience must be made as to which of the parties would suffer greater harm from the granting or refusal of the remedy pending a decision on the merits.

These factors are not watertight compartments, and the strength of one may compensate for the weakness of another. The “ultimate test for granting the stay is the interests of justice”.

First, did the appeal raise a serious question to be tried? While the threshold was low, the court must be mindful of the fact that the Divisional Court has already determined that the ICRC’s decision was reasonable, and that the appeal of a Divisional Court order – which is intended to be final – is not as of right. The proposed appeal did not have much merit and stood little chance of succeeding. It was far from certain that leave would even be granted. Given the requirement for leave and in light of the lack merit to the appeal, the Court concluded that there was no serious issue to be tried.

Second, will CT suffer irreparable harm if the stay is not granted? This one factor likely weighed in favour of a stay, as a dismissal of this motion would immediately enable the College to compel CT to consent to a review of her OHIP records, rendering the appeal itself nugatory.

Third, in regard to the balance of convenience, the Court was mindful of the fact that the ICRC’s decision and interim order have already been considered and upheld by the Divisional Court, and that the decision below was presumptively correct. Even though a dismissal of this motion would, in effect, determine the rights of these parties, the balance of convenience favoured not granting the stay.

Even if the court was wrong in the assessment that there was no serious issue to be tried, the Court would have still denied the request for a stay as, in the circumstances of this case, the public interest outweighed CT’s personal interests.

SHORT CIVIL DECISIONS

Letwin v. Camp Mart, 2022 ONCA 475

[Benotto, Zarnett and Sossin JJ.A.]

Counsel:

D. Thompson and A. Vigneault, for the appellant

W. Ngai, for the respondent

Keywords: Contracts, Torts, Negligence, Civil Procedure, Evidence

Street v. Toronto (Police Services Board), 2022 ONCA 486

[Huscroft, Nordheimer and Sossin JJ.A.]

Counsel:

K. S., acting in person

D. Smith, for the respondents

Keywords: Torts, Assault, Civil Procedure, Appeals, Evidence, Canadian Charter of Rights and Freedoms, Palmer v. The Queen, [1980] 1 S.C.R. 759

De Havilland Aircraft of Canada Limited v. Dias, 2022 ONCA 491

[Huscroft, Nordheimer and Copeland JJ.A.]

Counsel:

A. Dale and L. Sullivan, for the appellants

P. Carey and H. Levitt, for the respondent

Keywords: Labour Law, Unions, Civil Procedure, Injunctions

Anthony v. Vinczer, 2022 ONCA 493

[Huscroft, Nordheimer and Copeland JJ.A.]

Counsel:

AV, acting in person

GA, acting in person

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.

COURT OF APPEAL SUMMARIES (JUNE 13, 2022 – JUNE 17, 2022)

By John Polyzogopoulos on June 17, 2022

Jump To: Table of Contents | Civil Decisions | Short Civil Decisions

Good afternoon.

These are our summaries of the civil decisions of the Court of Appeal for Ontario for the week of June 13, 2022.

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In Ontario (Health) v Association of Ontario Midwives the Human Rights Tribunal of Ontario found that the Ministry of Health and Long-Term Care (the MOH) failed to fairly compensate midwives due to systemic gender discrimination. The Divisional Court upheld the Adjudicator’s decision on judicial review. The Court of Appeal dismissed an appeal from the Divisional Court’s decision.

In CHU de Québec-Université Laval v Tree of Knowledge International the Court released yet another decision on the application of the rule Handley Estate requiring parties to immediately disclose partial settlement agreements that change the landscape of the litigation, or risk having their claim against the non-settling defendants dismissed.

The Court set out the following principles drawn from its previous decisions on the abuse of process that arises from a failure to immediately disclose an agreement which changes the litigation landscape:

a) There is a “clear and unequivocal” obligation of immediate disclosure of agreements that “change entirely the landscape of the litigation”. They must be produced immediately upon their completion.

b) The disclosure obligation is not limited to pure Mary Carter or Pierringer agreements. The obligation extends to any agreement between or amongst the parties “that has the effect of changing the adversarial position of the parties into a co-operative one” and thus changes the litigation landscape.

c) The obligation is to immediately disclose information about the agreement, not simply to provide notice of the agreement, or “functional disclosure”.

d) Both the existence of the settlement and the terms of the settlement that change the adversarial orientation of the proceeding must be disclosed.

e) Confidentiality clauses in the agreements in no way derogate from the requirement of immediate disclosure.

f) The standard is “immediate”, not “eventually” or “when it is convenient”.

g) The absence of prejudice does not excuse a breach of the obligation of immediate disclosure.

In this particular case, the Court concluded that the motion judge did not err in refusing to dismiss the action for non-disclosure. Adequate and timely disclosure of the settlement had been made.

In KingSett Mortgage Corporation v 30 Roe Investments Corp, a receivership case, KingSett’s motion to quash 30 Roe’s appeal was granted and 30 Roe’s cross-motion for leave to appeal was dismissed. There was no automatic right of appeal under s. 193(c) of the BIA. Furthermore, the Court found that the proposed appeal was not meritorious and would unduly hinder the progress of the administration of the receivership. Accordingly, leave to appeal was denied.

Other topics covered this week included summary judgment on a claim for breach of an agreement of purchase and sale of land, equalization of net family property (pensions), assessment of solicitors’ accounts and stay pending appeal to the Supreme Court.

Wishing everyone an enjoyable weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Civil Decisions

Ilic v Ducharme Fox LLP (Ducharme Weber LLP) , 2022 ONCA 463

Keywords: Contracts, Solicitor and Client, Civil Procedure, Assessment of Solicitor’s Accounts, Solicitors Act, RSO 1990, c S15, s. 3(b) and s. 4(1), Rules of Civil Procedure, Rule 2.02(b), Davies, Ward & Beck v Union Industries Inc (2000), 48 OR (3d) 794 (CA), Price v Sonsini, 60 OR (3d) 257 (2002) (CA), Clatney v Quinn Thiele Mineault Grodzki LLP, 2016 ONCA 377, Lawrence v International Brotherhood of Electrical Workers (IBEW) Local 773, 2017 ONCA 321, Bridgeland Riverside Community Assn v Calgary (City), 1982 ABCA 138, Speciale Law Professional Corp v Shrader Canada Ltd, 2015 ONCA 856

Tsui v Zhuoqi, 2022 ONCA 464

Keywords: Contracts, Real Property, Agreements of Purchase and Sale of Land, Bad Faith, Damages, Summary Judgment, Bilotta v Booth, 2020 ONCA 522

CHU de Québec-Université Laval v Tree of Knowledge International Corp, 2022 ONCA 467

Keywords: Civil Procedure, Settlement Agreements, Disclosure, Appeals, Jurisdiction, Final or Interlocutory, Courts of Justice Act, RSO 1990, c C 43, ss 6(1)(b), 19(1)(b), Handley Estate v. DTE Industries Limited, 2018 ONCA 324, Poirier v. Logan, 2021 ONSC 163, Truck Centre Limited v. K.S.P. Holdings Inc., 2021 ONSC 984, Offshore Energy Inc. v. Ameron International Corp., 2013 SCC 37, Stamatopoulos v. Harris, 2014 ONSC 6313, Drywall Acoustic Lathing Insulation Local 675 Pension Fund v. SNC-Lavalin Group Inc., 2020 ONCA 375, Johnson v. Ontario, 2021 ONCA 650, McClintock v. Karam, 2017 ONCA 277, Ontario v. Nanji, 2020 ONCA 591, Aecon Buildings v. Brampton (City), 2010 ONCA 773, Ontario v. Lipsitz, 2011 ONCA 466, Housen v. Nikolaisen, 2002 SCC 33, Tallman Truck Centre Limited v. K.S.P. Holdings Inc., 2022 ONCA 66, Waxman v. Waxman, 2022 ONCA 311, Poirier v. Logan, 2022 ONCA 350, Aecon Buildings v. Stephenson Engineering Limited, 2010 ONCA 898, Sable Offshore Energy Inc. v. Ameron International Corp., 2013 SCC 37, Stamatopoulos v. Regional Municipality of Durham, 2014 ONSC 6313, K.J. v. The Regional Municipality of Halton, 2022 ONSC 2199, Endean v. St. Joseph’s General Hospital, 2019 ONCA 181, Aecon Buildings v. Stephenson Engineering Ltd., 2011 SCC 33, Pettey v. Avis Car Inc. (1993), 13 O.R. (3d) 725 (Gen. Div.), Laudon v. Roberts, 2009 ONCA 383

Talotta v Talotta, 2022 ONCA 474

Keywords: Family Law, Marriage Contracts, Separation Agreements, Equalization of Net Family Property, Pensions, Family Law Act, RSO 1990, c F3, s. 5, Sattva Capital Corp v Creston Moly Corp, 2014 SCC 53, Housen v Nikolaisen, 2002 SCC 33

Ontario (Health) v Association of Ontario Midwives, 2022 ONCA 458

Keywords: Labour and Employment, Administrative Law, Judicial Review, Standard of Review, Human Rights, Systemic Discrimination, Gender Discrimination, Compensation, Civil Procedure, Appeals, Human Rights Code, RSO 1990, c H.19, Human Rights Code Amendment Act, 2006, SO 2006, c. 30, s. 5, s. 45, Fraser v Canada (Attorney General), 2020 SCC 28, Canadian National Railway Co v Canada (Canadian Human Rights Commission), [1987] 1 SCR 1114, Centrale des syndicats du Québec v Quebec (Attorney General), 2018 SCC 18, Shaw v Phipps, 2010 ONSC 3884, Canada (Minister of Citizenship and Immigration) v Vavilov, 2019 SCC 65, R v Owen, 2003 SCC 33, Canada (Citizenship and Immigration) v Khosa, 2009 SCC 12, Dunsmuir v New Brunswick, 2008 SCC 9

Ernst & Young Inc v Aquino, 2022 ONCA 472

Keywords: Bankruptcy and Insolvency, Transfers Under Value, Civil Procedure, Appeals, Stay Pending Appeal, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, s. 269, Supreme Court Act, R.S.C. 1985, c. S-26, s. 65.1(1), Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36, Rules of Civil Procedure, Rule 63.01(1), Ting (Re), 2019 ONCA 768, Canadian Dredge & Dock Co v The Queen, [1985] 1 S.C.R. 662, Deloitte & Touche v Livent Inc (Receiver of), 2017 SCC 63

KingSett Mortgage Corporation v 30 Roe Investments Corp, 2022 ONCA 479

Keywords: Contracts, Real Property, Mortgages, Enforcement, Receiverships, Bankruptcy and Insolvency, Civil Procedure, Appeals, Leave to Appeal, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, s. 193 (c) & (e), Courts of Justice Act, RSO 1990, c. C.43, s. 101, Rules of Civil Procedure, Rule15.04(6), Business Development Bank of Canada v Astoria Organic Matters Ltd, 2019 ONCA 269, Buduchnist Credit Union Limited v 2321197 Ontario Inc, 2019 ONCA 588, Hillmount Capital Inc v Pizale, 2021 ONCA 364, Business Development Bank of Canada v Pine Tree Resorts Inc, 2013 ONCA 282, Comfort Capital Inc v Yeretsian, 2019 ONCA 1017, Royal Bank of Canada v Bodanis, 2020 ONCA 185, Shaver-Kudell Manufacturing Inc v Knight Manufacturing Inc, 2021 ONCA 202, Hillmount Capital Inc v Pizale, 2021 ONCA 364, Essar Steel Algoma Inc (Re), 2017 ONCA 478

Short Civil Decisions

ALB v Durham Children’s Aid Society, 2022 ONCA 466

Keywords: Family Law, Child Protection, Civil Procedure, Frivolous, Vexatious and Abuse of Process, Child, Youth and Family Services Act, 2017, ss. 87(8) and 87(9) and 142(3), Scaduto v The Law Society of Upper Canada, 2015 ONCA 733, Lochner v Ontario Civilian Police Commission, 2020 ONCA 720

Anderson Learning Inc (Bond International College) v Birchmount Howden Property Holdings Inc, 2022 ONCA 469

Keywords: Contracts, Real Property, Commercial Leases, Options to Renew, 120 Adelaide Leaseholds Inc v Oxford Properties Canada Ltd, [1993] OJ No 2801 (CA), Housen v Nikolaisen, 2002 SCC 33

CIVIL DECISIONS

Ilic v Ducharme Fox LLP (Ducharme Weber LLP), 2022 ONCA 463

[Lauwers J.A.]

Counsel:

S. Dewart and M. Bélanger, for the appellant

P. J. Ducharme, for the respondents

facts:

The application judge dismissed the appellant’s application for an order allowing the assessment of the respondent solicitor’s accounts to continue before an Assessment Officer.

The appellant retained P. Ducharme to represent him on criminal charges. The nature of the retainer, that is, whether the parties had agreed to a block fee or an hourly fee, was disputed. The appellant entered a guilty plea in accordance with a plea bargain. The respondents delivered interim accounts and a final account to the appellant.

The appellant took out an order for assessment of the final account and another for the assessment of the interim accounts. An Assessment Officer heard the evidence on the assessment and then a year later, the Assessment Officer asked the parties for submissions on the issue of his jurisdiction because the order for assessment had been issued by the registrar after the 30-day statutory window. The respondents argued that the Assessment Officer was without jurisdiction and that the assessment order was accordingly a nullity.

More than a year later, the Assessment Officer accepted the respondents’ argument and found that he did not have jurisdiction to conduct the assessment. He then stayed the matter, pending direction from the Superior Court.

The appellant applied to the Superior Court for an order allowing the assessment proceeding before the Assessment Officer to continue and for directions. In the alternative, the appellant sought an order nunc pro tunc referring the respondents’ bills to a new assessment under s. 4(1) of the Solicitors Act.

The application judge declined to exercise his jurisdiction to allow the assessment to proceed. He found that the appellant was not caught off guard by the requisition deadline of 30 days, because he had been represented by counsel who was alerted to the jurisdictional issue by the first Assessment Officer in 2010. The appellant’s failure to cure the procedural defect in the manner proposed by Assessment Officer weighed against granting the appellant the remedy he sought.

The application judge held that even if the respondents could be taken as having consented to proceeding by assessment hearing, consent could not confer jurisdiction where there was none. He held that no Assessment Officer had jurisdiction to proceed in this matter. The protracted assessment procedure in which the parties had engaged was a nullity. This left the respondents’ three accounts unchanged and enforceable as originally rendered.

issues:

(1) Did the judge err in failing to consider that the assessment proceeded on consent of both parties and had been completed before the jurisdiction issue arose?

(2) Did the judge err in finding that the respondents were prejudiced by the failure to commence the assessment proceeding within the time required under the Solicitors Act, in the absence of any evidence of prejudice?

(3) Did the judge err in failing to consider binding authority on the proper approach to the assessment of solicitor accounts and to nullity in a civil procedure context?

(4) Did the judge err in failing to consider the appellant’s alternative claim for an order for assessment nunc pro tunc in the particular circumstances of this case?

holding:

Appeal allowed.

reasoning:

(1), (2) and (3). Yes. The application judge made the first three errors.

The decision of the application judge did not accord with the principle in Price v Sonsini that “[p]ublic confidence in the administration of justice requires the court to intervene where necessary to protect the client’s right to a fair procedure for the assessment of a solicitor’s bill.”

The application judge focused on the fact that the appellant had been told by the first Assessment Officer to remedy the jurisdictional issue. He found the appellant’s subsequent actions to be “many steps over the course of many years” taken with the knowledge of the jurisdictional problem, in direct contradiction of Rule 2.02(b) of the Rules of Civil Procedure. In doing so he invoked the ruling in Price.

Rather than use the Price ruling to facilitate the assessment, the application judge used it to frustrate the assessment. Although he accepted that the provisions of the Solicitors Act “are to be read generously in favour of the client party seeking fairness in challenging his or her solicitor’s account”, he held that fairness also “defines the limits of this generosity.” He relied on Price in order to make this point, quoting that Rule 2.02(b) “limits the right of a party to attack a proceeding or a step, document or order in a proceeding for irregularity if the party has taken a further step in the proceeding after obtaining knowledge of the irregularity.”

The respondents agreed to the assessment procedure despite knowing of the jurisdictional defect. They participated in the assessment process for the next five years before seizing on the jurisdiction issue as an exit. There was no basis on which fairness, as invoked by the application judge, could justify bringing the assessment proceedings to an end in the utter absence of any evidence of prejudice to the respondents.

(4) Yes. The application judge had the authority to authorize the Assessment Officer to complete the assessment and to issue a decision on the merits. His failure to do so was an error.

A new assessment was not ordered. Rather, the Assessment Officer who heard the evidence and the arguments must now issue his decisions on the merits without delay.

Tsui v Zhuoqi, 2022 ONCA 464

[Doherty, Tulloch and Miller JJ.A.]

Counsel:

P.H. Starkman and C. Zhang, for the appellant

N.J. Kasozi and M. Dvorkina, for the respondents

Keywords: Contracts, Real Property, Agreements of Purchase and Sale of Land, Bad Faith, Damages, Summary Judgment, Bilotta v Booth, 2020 ONCA 522

facts:

The appellants (“vendors”) had agreed to sell a residential property to the respondents (“purchasers”). The transaction had not closed as a result of problems associated with water damage to the property that occurred shortly before closing. The water damage was discovered by the purchasers one day before closing. The parties had attempted to resolve those problems by negotiation but failed.

The purchasers sued the vendors and sought a declaration that the vendors had breached the agreement of purchase and sale, an order directing the return of the deposit and damages associated with the failure to close the transaction.

The vendors counterclaimed and sought a declaration that the purchasers had repudiated the agreement of purchase and sale. The vendors also sought an order forfeiting the deposit.

Both sides moved for summary judgment. With one exception, the outcome of the motions turned entirely on the factual findings made by the motion judge. The factual findings related to the seriousness of the damage to the property and the claims by both sides that the other side had not made good faith efforts to salvage the agreement after the damage occurred. The one exception arose out of the vendors’ claim that the motion judge’s reliance on the terms of s. 18 of the Agreement of Purchase and Sale (“APS”) resulted in procedural unfairness.

Section 18 provided that if there was substantial damage to the property after the parties entered into the APS, but before the closing date, the purchaser had the option to terminate the agreement and was entitled to the return of the deposit.

The motion judge rejected the argument that s. 18 was not properly pleaded and made findings of fact in favour of the purchasers. He dismissed the vendors’ motion for summary judgment and granted the purchasers’ cross-motion. The motion judge awarded damages in the amount of $33,110.32 and ordered the return of the deposit. The vendors appealed.

issues:

Did the motion judge err in dismissing the vendors’ motion for summary judgment and granting the purchasers’ cross-motion for summary judgment?

holding:

Appeal dismissed.

reasoning:

No. The Court restated that despite any shortcoming in the pleadings, the question whether the damages to the property should be characterized as “substantial”, thereby triggering s. 18, was at the centre of the dispute.

The Court emphasized that the motion judge’s conclusions of the factual questions of the case were entitled to deference. The Court noted that the factual findings were not unreasonable or based on a palpable and overriding error. In considering whether the damage was “substantial”, the key factual finding, the motion judge was entitled to consider all of the evidence, which included that the evidence of the expert that the full extent of the water damage was likely not apparent from the limited inspections conducted on behalf of the vendors. It was open to the motion judge to conclude, based on all of the evidence, that the damage had met the “substantial” standard. The Court further noted that the vendors’ reliance on different findings made in another case based on different evidence did not advance their argument.

The vendor’s argument of good faith was rejected based on the evidence available to the court. The Court was not convinced that the motion judge made a clear and palpable error or came to an unreasonable finding in rejecting the vendors’ argument that the purchasers had acted in bad faith.

Regarding the extensive water damage discovered, the Court noted that in the circumstances of this case, the vendors were required to afford the purchasers a reasonable opportunity to inspect the property and assess the damage: Bilotta v Booth at para. 20. The Court noted the motion judge properly held that the purchasers were not obliged to close the transaction on January 10. Instead, they were entitled to a reasonable opportunity to inspect the property.

The vendors made two submissions regarding damages. First, they argued that the rental costs awarded to the purchasers ($25,800) failed to offset the savings associated with not having to pay the costs of a mortgage. The Court stated that there was merit to the submission that at least some of the rental costs may have been offset by the absence of any mortgage-related costs, but concluded that there was no evidence that the purchasers had a mortgage or what the costs were associated with that mortgage.

Second, the vendors submitted that the costs of the engineering report commissioned by the purchasers to assess the nature and extent of the water damage should not have been treated as damages by the motion judge. The Court agreed on this point and noted that the information was essential to the purchasers’ exercise of rights and obligations under the APS. Further, the cost of the report was not a consequence of bad faith conduct of the vendors. The Court concluded that damages previously awarded regarding the engineering report should be reduced by $4,978.89, leaving a damage award of $29,131.13.

CHU de Québec-Université Laval v Tree of Knowledge International Corp, 2022 ONCA 467

[Strathy C.J.O., Sossin and Favreau JJ.A]

Counsel:

R. Stellick, for the appellant

S. Dewart and B. Hughes, for the respondent

facts:

This appeal raised the issue of the scope and application of the rule from Handley Estate v. DTE Industries Limited, that parties entering into agreements which entirely change the adversarial landscape of the litigation must immediately disclose those agreements to the noncontracting parties.

The appeal was from the order of the motion judge dismissing the motion of the appellant M.C and the motion of Blu Stella Consulting Group Inc. (“Blu Stella”) and F.G to stay or dismiss the action of the respondent, CHU de Québec-Université Laval, based on the respondent’s failure to immediately disclose the terms of a Pierringer agreement between it and two other defendants in this action, Tree of Knowledge International Corp. (“TOKI”), and Tree of Knowledge Inc. (“TOK US”).

The dispute leading to the action arose out of a contract between the respondent and TOKI and/or TOK US for the supply of three million certified N95 masks. The respondent advanced the full amount of the purchase price to TOK US, per wire instructions from M.C, for “certified N95 masks for medical use.” The masks were never delivered, although lesser quantities of non-certified masks for non-medical use were delivered to the respondent.

On August 6, 2020, the respondent commenced the within action against all the defendants to recover the funds it advanced, alleging fraudulent or negligent misrepresentation. On May 26, 2021, the respondent signed the Settlement Agreement, a Pierringer agreement, with TOKI and TOK US. The Settlement Agreement provided that the respondent’s claims against TOKI and TOK US were dismissed without costs.

On June 4, 2021, in response to a demand by counsel to the Blu Stella defendants for a copy of the Settlement Agreement and the assignment agreement mentioned in the amended claim, counsel to the respondent provided a copy of the assignment agreement between TOKI and the respondent to the non-settling defendants. Counsel to the respondent confirmed that his instructions were to not provide a copy of the Settlement Agreement to the non-settling defendants.

issues:

(1) Did the Court have jurisdiction over the appeal?

(2) Did the motion judge err in in interpreting and applying the rule from Handley Estate?

holding:

Appeal dismissed.

reasoning:

(1) Yes.

Sections 6(1)(b) and 19(1)(b) of the Courts of Justice Act make clear that only final orders are appealable to the Court. The respondent submitted that a decision granting a stay or dismissal is final, but a decision denying such relief is interlocutory. The Court has held that an order denying a stay of an action on the basis of an abuse of process, because it was based on a champertous agreement and the agreement was not disclosed as soon as it was completed, was final. Given the Court’s decision in Aecon, the Court was satisfied that it had jurisdiction over the dispute.

(2) No.

The rule set out in Handley Estate has been the subject of three recent decisions of the Court: Tallman Truck Centre Limited v KSP Holdings Inc, Waxman v Waxman and Poirier v Logan.

The following principles were drawn from the Court’s decisions on the abuse of process that arises from a failure to immediately disclose an agreement which changes the litigation landscape:

c) The obligation is to immediately disclose information about the agreement, not simply to provide notice of the agreement, or “functional disclosure”.

d) Both the existence of the settlement and the terms of the settlement that change the adversarial orientation of the proceeding must be disclosed.

e) Confidentiality clauses in the agreements in no way derogate from the requirement of immediate disclosure.

f) The standard is “immediate”, not “eventually” or “when it is convenient”.

g) The absence of prejudice does not excuse a breach of the obligation of immediate disclosure.

h) Failure to comply with the obligation of immediate disclosure amounts to abuse of process and results in serious consequences. The only remedy to redress the abuse of process is to stay the claim brought by the defaulting, non-disclosing party. This remedy is necessary to ensure the court is able to enforce and control its own processes and ensure justice is done.

From the outset, the respondent advised the non-settling defendants of the existence of the Settlement Agreement and committed to put the Settlement Agreement before the court. This aspect of the factual dynamics distinguished the present case from Handley Estate, Tallman, Waxman, and Poirier, and failed to give rise to the rationale underlying the rule that failure to disclose is an abuse of process.

Disclosure must go beyond the “functional disclosure”. In this case, the respondent did not merely provide functional disclosure. The respondent immediately disclosed those aspects of the Settlement Agreement that changed the litigation landscape.

Whether or not cooperation is an inherent feature of Pierringer agreements, the cooperation in this case was disclosed soon after the initial disclosure and formed part of the factual dynamics leading to the approval motion. Therefore, the failure to disclose the cooperation immediately was not fatal. Given the factual dynamics in this case, the Court saw no error in the motion judge’s conclusion that the essential terms of the Settlement Agreement were immediately disclosed.

Talotta v Talotta, 2022 ONCA 474

[Brown, Roberts, and Pacioco JJ.A.]

Counsel:

A. Perruccio and V. Di Vito, for the appellant

L. Kadoory, for the respondent

facts:

After 16 years of marriage, the respondent and appellant separated and entered into a separation agreement in 1997 that required the respondent to receive one-half of the husband’s Metro Toronto News newspapers pension valued from the date of separation in the amount of $10,372.59. The separation agreement also required the appellant to provide the respondent with an actuarial valuation of his pension. The appellant breached this obligation.

The appellant retired and did not pay the respondent her share of the pension benefits earned during their marriage. He further refused to provide any information about his pension and evaded service of the respondent’s application for payment of her share of his pension, requiring her to obtain an order for substituted service.

At an uncontested trial at which the appellant did appear, the respondent put forward uncontested expert actuarial valuation evidence that the amount of $20,372.59 stated in the separation agreement only represented half of the appellant’s contributions with interest to a defined-benefit pension plan as of December 1995.

The trial judge ordered that the appellant roll over from his pension the amount of $76,966 and awarded full indemnity costs.
The appellant appealed the decision of the trial judge.

issues:

Did the trial judge err in his interpretation of the plain language of the parties’ separation agreement and effectively rewrite the agreement by awarding the current value of the respondent’s share of his pension instead of the stated $10,372.59 amount?

holding:

Appeal dismissed.

reasoning:

No.

The trial judge’s interpretation of the separation agreement was open to him and was entitled to deference on appellate review. The trial judge did not rewrite the parties’ agreement, but rather he interpreted the separation agreement in accordance with the equalization entitlements under the Family law Act. The trial judge accepted the respondent’s entitlement to a pro-rata share of the actual present value of the appellant’s pension benefit accumulation during marriage in the amount of $76,966.

The Court concluded that the interpretation that made the most sense was that the parties’ objective intention was for the respondent to receive her entitlement to half of the value of the portion of the pension attributable to the period of the marriage. The agreement specifically said she was to receive one-half of the husband’s Metro Toronto News and Ontario Newspapers pension valued from the date of marriage up to the date of separation, and not simply half of the appellant’s contributions.

The Court found that the trial judge’s determination of the respondent’s proportionate share of the current value of the appellant’s pension was reasonably anchored in uncontested expert evidence, which the trial judge was entitled to accept.

Finally, the Court did not accept the respondent’s proferred affidavit evidence, as it amounted to an abuse of process, given his attempts to evade service and failure to participate at the trial.

Ontario (Health) v Association of Ontario Midwives, 2022 ONCA 458

[Fairburn A.C.J.O., Roberts J.A. and Van Melle J.]

Counsel:

S. Z Green and Y. Ranganathan, for the appellant

M. Cornish, A. Telford, L. Koerner-Yeo and J. Esmonde, for the respondent Association of Ontario Midwives

J. Tam and B. A. Blumenthal, for the respondent Human Rights Tribunal of Ontario

R. Khawja and R. Dhir, for the intervener Ontario Human Rights Commission

Keywords: Labour and Employment, Administrative Law, Judicial Review, Standard of Review, Human Rights, Systemic Discrimination, Gender Discrimination, Compensation, Civil Procedure, Appeals, Human Rights Code, RSO 1990, c H.19, Human Rights Code Amendment Act, 2006, SO 2006, c. 30, s. 5, s. 45, Fraser v Canada (Attorney General), 2020 SCC 28, Canadian National Railway Co v Canada (Canadian Human Rights Commission), [1987] 1 SCR 1114, Centrale des syndicats du Québec v Quebec (Attorney General), 2018 SCC 18, Shaw v Phipps, 2010 ONSC 3884, Canada (Minister of Citizenship and Immigration) v Vavilov, 2019 SCC 65, R v Owen, 2003 SCC 33, Canada (Citizenship and Immigration) v Khosa, 2009 SCC 12, Dunsmuir v New Brunswick, 2008 SCC 9

facts:

Ontario midwives are almost exclusively women. In 2013, the Association of Ontario Midwives (the “AOM”) brought a human rights complaint on behalf of more than 800 midwives, alleging systemic gender discrimination by the Ministry of Health and Long-Term Care (the “MOH”), which funds Ontario’s midwifery program. The AOM challenged the MOH’s compensation practices back to 1994, when Ontario midwives were regulated, and sought compensation back to 1997.

The Human Rights Tribunal of Ontario (the “Tribunal”) Adjudicator divided the decision into two periods: 1993 to 2005, and 2005 to 2013. The adjudicator found that, in 1993, the parties agreed to equitable compensation principles that were designed to ensure that midwives’ compensation was not affected by harmful assumptions and stereotypes concerning the value of women’s work. The adjudicator was satisfied that the parties maintained a connection to the principles until 2005, and there was insufficient evidence of discrimination for the period from 1994 to 2005.

However, the Adjudicator found that after 2005, the MOH gradually withdrew from the principles it had agreed to in 1993. The Adjudicator concluded that midwives were subjected to systematic gender discrimination after 2005, having the effect of perpetuating the historic disadvantage midwives have experienced as sex-segregated workers. There was a significant compensation gap that developed between midwives and certain family physicians, who the Adjudicator found served as a male comparator. In a separate decision, the Adjudicator made remedial orders arising from their finding of liability, including orders granting a compensation adjustment of 20% back to 2011 and compensation for injury to dignity, feelings, and self-respect in the amount of $7,500 per eligible midwife, plus orders to promote ongoing compliance with the Code.

The MOH applied to the Divisional Court for judicial review of both decisions. Its application was dismissed. The MOH appealed to the Ontario Court of Appeal.

issues:

(1) What is the standard of review of the Tribunal’s decision post-Vavilov?

(2) Is the Adjudicator’s liability decision unreasonable? In particular:

a. Did the Adjudicator’s reasons fail to reveal a rational chain of analysis?
b. Was it unreasonable for the Adjudicator to find that gender was a factor in the compensation of midwives?
c. Did the Adjudicator reverse the burden of proof?
d. Did the Adjudicator unreasonably ignore the MOH’s expert evidence tendered to prove that gender was not a factor in midwives’ compensation?
e. Did the Adjudicator unreasonably find that community health clinic (“CHC”) physicians remained appropriate comparators after they became predominantly female?
f. Did the Adjudicator unreasonably impose a positive obligation on the MOH?

(3) Is the Adjudicator’s remedy decision unreasonable?

holding:

Appeal dismissed.

reasoning:

(1) Vavilov does not undermine the reasoning in Shaw v Phipps, which adopted a reasonableness standard of review for determinations of fact, the interpretation and application of human rights law, and remedial decisions.

The Divisional Court accepted the MOH’s submission, concluding that Vavilov did not overrule Shaw v Phipps. Accordingly, it applied a reasonableness standard. The Divisional Court correctly interpreted s. 45.8 of the Code, and: (1) recognized that the reviewing court should apply the legislated standard; (2) purposively interpreted s. 45.8 of the Code; (3) considered the content of the standard in light of general principles of administrative law; and (4) addressed rule of law concerns that had weaved their way into the jurisprudence surrounding the difference between patent unreasonableness and unreasonableness.

(2) No.

MOH argued that the Adjudicator engaged in illogical reasoning, failed to articulate a rational chain of analysis, made unreasonable factual findings, gave some evidence too much weight or too little weight, drew ungrounded inferences, ignored important expert and other evidence, reversed the burden of proof, and misinterpreted and misapplied the Code in imposing a positive obligation on the MOH. The question for the Court was whether the Adjudicator’s decision as a whole was reasonable.

In assessing the reasonableness of the Tribunal’s liability decision, and bearing in mind the multitude of complaints raised by the MOH, the Court structured its analysis around the following key issues raised by the MOH:

(a) Do the Adjudicator’s reasons fail to reveal a rational chain of analysis?

(b) Was it unreasonable for the Adjudicator to find that gender was a factor in the compensation of midwives?

(d) Did the Adjudicator unreasonably ignore the MOH’s expert evidence tendered to prove that gender was not a factor in midwives’ compensation?

(e) Did the Adjudicator unreasonably find that CHC physicians remained appropriate comparators after they became predominantly female?

(f) Did the Adjudicator unreasonably impose a positive obligation on the MOH?

(a) Do the Adjudicator’s reasons fail to reveal a rational chain of analysis?

No. A decision will be unreasonable if its reasons, “read holistically, fail to reveal a rational chain of analysis or if they reveal that the decision was based on an irrational chain of analysis”, or where “the conclusion reached cannot follow from the analysis undertaken … or if the reasons read in conjunction with the record do not make it possible to understand the decision maker’s reasoning on a critical point”: Vavilov, at para. 103. At the end of the day, the reasoning must “add up”: Vavilov, at para. 104.

The Court found the Adjudicator’s reasoning did “add up”. The Adjudicator’s reasons revealed a logical chain of analysis grounded in the record and the relevant jurisprudence in support of their key conclusion that sex was a factor in the adverse treatment that midwives experienced and the compensation gap that developed between midwives and CHC physicians after 2005.

The Adjudicator concluded that gender was a factor in the adverse treatment of midwives for a number of reasons, including that the MOH abandoned the principles designed to safeguard against gender discrimination, after receiving a report confirming the ongoing relevance of the principles, and without a credible explanation for doing so or a new methodology to ensure that midwives were being paid appropriately.

(b) Was it unreasonable for the Adjudicator to find that gender was a factor in the compensation of midwives?

No. The Court held it was not unreasonable for the Adjudicator to find that gender was a factor in compensation of midwives. The 1993 principles were connected, if not imbued, with gender, and it was open to the Adjudicator to find that the Courtyard Report, which affirmed those principles, indicates “that gender discrimination may be an operative factor in the compensation of midwives”. It was also open to the Adjudicator to reasonably find that the Courtyard Report was “sufficiently compelling for the MOH to realize that the AOM’s claim of gender discrimination may have some validity.”

(c) Did the Adjudicator reverse the burden of proof?

No. There was no reversal of the burden of proof in this case. All that was shifted to the MOH was the evidential burden, which the Adjudicator found was not met.

On multiple occasions, the Adjudicator made clear that they understood who held the ultimate onus in this case. For instance, stating that the onus of proving discrimination “lies with the AOM and that the standard of proof is the balance of probabilities”. The Adjudicator later reinforced their clear understanding that in a human rights case, “the burden of proof remains on the applicant throughout”, including quoting from the Pieters decision: “The question to be decided is whether the applicant has satisfied the legal burden of proof of establishing on a balance of probabilities that the discrimination has occurred”: Pieters, at para. 83.

(d) Did the Adjudicator unreasonably ignore the MOH’s expert evidence that was tendered to prove that gender was not a factor in midwives’ compensation?

No. The Adjudicator did not ignore the evidence that the MOH said demonstrated non-discriminatory reasons for the gap in compensation between CHC physicians and midwives. The Adjudicator recognized several factors, but did not accept that gender was not also a factor, alongside the explanation provided by the MOH, in the adverse treatment of midwives. The MOH did not point to any expert evidence that could explain the central findings of fact that drove the conclusion of discrimination.

(e) Did the Adjudicator unreasonably find that CHC physicians remained an appropriate comparator after they became predominantly female?

No. The Adjudicator correctly recognized that the Code does not prescribe rules to determine the sex of an occupational group or any methodology for developing a compensation model that is Code-compliant. In this case, the parties chose CHC physicians as a male comparator and the Adjudicator reasonably found that they remained a male comparator until 2013, even though they were predominately women, because their pay had been aligned with a male dominated group.

(f) Did the Adjudicator unreasonably impose a positive obligation on the MOH?

No. The Divisional Court correctly addressed the thrust of these arguments and concluded that the Adjudicator’s decision was reasonable.

(3) No

The Adjudicator concluded that the best evidence of the consequences of the move away from the 1993 principles was the jointly commissioned Courtyard Report. According to the Adjudicator, implementing Courtyard would “[bring] the parties as close as possible” to the “place they would have been but for the discrimination”.

The Code provides the Tribunal with broad remedial discretion to order remedies that are fair, effective and responsive to the circumstances of the particular case. In exercising their remedial discretion, the Adjudicator fashioned a remedy based on the evidence that was before them. The MOH did not point to any legitimate basis for interfering with the Tribunal’s discretionary remedial decision.

Ernst & Young Inc v Aquino, 2022 ONCA 472

[van Rensburg J.A. (Motion Judge)]

Counsel:

T. Corsianos and G. Corsianos, for the moving parties J.A., 2304288 Ontario Inc., M.C., G.A., and L.C.

A. Merskey, E. Cobb and S. Taylor, for the responding party Ernst & Young Inc., in its capacity as Court Appointed Monitor of Bondfield Construction Company Limited

J. Opolsky and C. Gilchrist, for the responding party KSV Restructuring Inc. in its capacity as Trustee in Bankruptcy of 1033803 Ontario Inc. and 1087507 Ontario Limited

facts:

This was a motion for a stay of execution of the judgments of Dietrich J. dated March 19, 2021, obtained in the context of proceedings involving Bondfield Construction Company Limited and certain of its affiliates under the Companies’ Creditors Arrangement Act (the “CCAA”) and the Bankruptcy and Insolvency Act (the “BIA”). The judgments resulted from applications by the Monitor and the Trustee under s. 96 of the BIA (and, in the case of the Monitor, under s. 36.1 of the CCAA) for declarations that various payments from Bondfield to the moving parties were transfers at undervalue made with the intent to “defraud, defeat or delay” Bondfield’s creditors, and for compensation for those transfers.

issues:

Has the appellant met the test for granting a stay pending an application for leave to appeal to the Supreme Court?

holding:

Motion dismissed.

reasoning:

No.

The Court applied the well-established testfor a stay pending appeal to the Supreme Court: (i) there is a serious issue to be adjudicated on its proposed appeal, including that the appeal raises an issue of public or national importance; (ii) it will suffer irreparable harm if the stay is not granted; and (iii) the balance of convenience favours granting the stay.

The Court agreed with the respondents that the determinative factor on the motion was the inability of the moving parties to prove irreparable harm if the stay was refused. The moving parties’ argument about irreparable harm at this stage was that without a stay, J.A. would be prevented from negotiating a sale of his 8.3% interest in the “Anderson property” to a third party (should an interested third party come forward), a sale that he acknowledged would be subject to the Monitor’s prior approval and would generate proceeds for the Monitor. This was a property that J.A. claimed was of “no value”. The inability to sell it therefore did not constitute irreparable harm.

The balance of convenience did not favour the moving parties. No security had been offered in this case, and the judge concluded that the assets in the Monitor’s hands were insufficient to satisfy the judgments.

KingSett Mortgage Corporation v 30 Roe Investments Corp, 2022 ONCA 479

[Brown, Roberts and Paciocco JJ.A.]

Counsel:

R. Swan and S. Zweig, for the moving party (M53449)/responding party (M53510) KingSett Mortgage Corporation

N.J. Tourgis and L. Paddock, for the responding party (M53449)/moving party (M53510) 30 Roe Investments Corp.

M. Dunn, for KSV Restructuring Inc. in its capacity as court-appointed receiver

D. Marr, for Canadian Imperial Bank of Commerce

Keywords:Contracts, Real Property, Mortgages, Enforcement, Receiverships, Bankruptcy and Insolvency, Civil Procedure, Appeals, Leave to Appeal, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, s. 193 (c) & (e), Courts of Justice Act, RSO 1990, c. C.43, s. 101, Rules of Civil Procedure, Rule15.04(6), Business Development Bank of Canada v Astoria Organic Matters Ltd, 2019 ONCA 269, Buduchnist Credit Union Limited v 2321197 Ontario Inc, 2019 ONCA 588, Hillmount Capital Inc v Pizale, 2021 ONCA 364, Business Development Bank of Canada v Pine Tree Resorts Inc, 2013 ONCA 282, Comfort Capital Inc v Yeretsian, 2019 ONCA 1017, Royal Bank of Canada v Bodanis, 2020 ONCA 185, Shaver-Kudell Manufacturing Inc v Knight Manufacturing Inc, 2021 ONCA 202, Hillmount Capital Inc v Pizale, 2021 ONCA 364, Essar Steel Algoma Inc (Re), 2017 ONCA 478

facts:

The respondent, KingSett Mortgage Corporation (“KingSett”), moved to quash the appeal brought by 30 Roe Investments Corp. (“30 Roe”) from the order of Cavanagh J. dated May 9, 2022 (the “Receivership Order”). That order appointed KSV Restructuring Inc. as the receiver and manager of nine residential condominium units (the “Real Property”), owned by 30 Roe in a 397-unit condominium building.

30 Roe opposed the motion to quash, arguing that it enjoyed an appeal as of right from the Receivership Order under s. 193(c) of the Bankruptcy and Insolvency Act (“BIA”). As well, it moved for leave to appeal the Receivership Order pursuant to s. 193(e) of the BIA.

KingSett advanced a non-revolving demand loan to 30 Roe for the principal amount of $1.875 million, secured by a second mortgage on the Real Property, a General Security Agreement and other security. The Canadian Imperial Bank of Commerce (“CIBC”) holds a first mortgage on the Real Property.

30 Roe defaulted, and KingSett issued a demand letter and gave notice of intention to enforce security in accordance with s. 244 of the BIA.

KingSett applied for the appointment of a receiver and manager of the Real Property pursuant to s. 243(1) of the BIA and s. 101 of the Courts of Justice Act (“CJA”). 30 Roe sought and obtained three adjournments of the application.

Cavanagh J. refused a fourth adjournment for two reasons: (i) although 30 Roe had obtained an expression of interest to provide refinancing, the letter of intent was not a binding commitment letter and the application judge concluded there was no assurance 30 Roe would secure refinancing to pay out its debt to KingSett if a further adjournment was granted; and (ii) 30 Roe had not acted reasonably or in accordance with prior court endorsements to find new counsel.

As of the hearing date, the state of affairs regarding the Real Property was as follows: (i) CIBC took no position in opposition to the application; (ii) all units were rented and rents were being paid; (iii) 30 Roe was paying interest on the second mortgage debt; and (iv) CIBC was willing to defer enforcement steps for 30 days to allow 30 Roe an opportunity to put in place refinancing.

On May 9, 2022, Cavanagh J. made the Receivership Order.

The next day, May 10, 2022, 30 Roe delivered a notice of appeal in which the grounds of appeal are essentially three-fold: (i) the motion judge erred in refusing its fourth adjournment request; (ii) he misapplied the factors applicable to whether it would be just and convenient to appoint a receiver; and (iii) he erred in failing to recognize that KingSett had impliedly extended the loan facility until April 1, 2022, by debiting the amount of an extension fee to 30 Roe’s mortgage debt account in January and February 2022. The application judge accepted KingSett’s evidence that the debits were the result of an administrative error, which KingSett had reversed once advised of the mistake.

KingSett moved to quash the appeal on the basis that 30 Roe does not enjoy an appeal of right under BIA s.193, but required leave to appeal.

30 Roe took the position that an appeal lies as of right under BIA s. 193(c), as “the property involved in the appeal exceeds in value ten thousand dollars.” 30 Roe brought a separate motion for leave to appeal the Receivership Order pursuant to BIA s. 193(e).

issues:

(1) Should the appeal be quashed on the basis that 30 Roe does not enjoy an appeal of right under s. 193(c) of the BIA, but instead required leave to appeal?

(2) Should 30 Roe’s motion for leave to appeal the Receivership Order pursuant to s. 193(e) of the BIA be granted?

holding:

Motion to quash appeal granted. Cross-motion for leave to appeal dismissed.

reasoning:

(1) Yes.

30 Roe fashioned two arguments about the availability of a right of appeal under BIA s. 193(c).

First, 30 Roe relied on several Chambers decisions of the Court to contend that s. 193(c) authorizes an automatic right of appeal from a receivership order. The first decision was Comfort Capital Inc v Yeretsian. However, that case did not involve an appeal from an order appointing a receiver; the nature of the order in Comfort Capital was quite different. There, the order under appeal directed payment of part of the proceeds of the receiver’s sale of property to one set of claimants that was otherwise payable to another claimant. The order resulted in a loss to the second claimant and, therefore, the nature of the order fell within s. 193(c). Comfort Capital had no application to the order at issue in the present case.

The other Chambers decisions were those in Royal Bank of Canada v Bodanis and Shaver-Kudell Manufacturing Inc v Knight Manufacturing Inc. Neither case provided support for 30 Roe’s submission that s. 193(c) granted an automatic right of appeal from a receivership order, because neither case involved an attempt to appeal a receivership order. The order at issue in Bodanis was a bankruptcy order; that in Shaver-Kudell was an order declaring that a bankrupt’s debts and liabilities would survive his discharge from bankruptcy.

30 Roe’s second argument was based on para. 3(k) of the Receivership Order, which dealt with the powers of the receiver and authorized the receiver to sell any part of the Real Property out of the ordinary course of business “without the approval of this Court in respect of any transaction not exceeding $250,000, provided that the aggregate consideration for all such transactions does not exceed $500,000.”

Drawing on that provision, 30 Roe argued as follows: (i) in Pine Tree Resorts the Chambers judge described the nature of a receivership order as one that does not bring into play the value of the debtor’s property but simply appointed an officer of the court to preserve and monetize those assets subject to court approval; (ii) in Pine Tree Resorts the court relied on that description of the nature of a receivership order to conclude that s. 193(c) does not provide an automatic right of appeal from such an order; (iii) however, para. 3(k) of the Receivership Order identified a sub-set of 30 Roe’s property that the receiver may sell without applying for court approval; so, therefore, (iv) the nature of the Receivership Order containing para. 3(k) differed from that which led the court in Pine Tree Resorts to conclude that no appeal as of right existed. It followed, according to 30 Roe, that the presence of the para. 3(k) carve-out in the Receivership Order placed that order in the class of orders for which an automatic right of appeal existed under s. 193(c).

The Court was not persuaded by this submission. First, 30 Roe did not cite any authority involving a receivership order to support its proposition. Second, as KingSett pointed out, the receivership order made in Pine Tree Resorts contained the same carveout granting the receiver the power to sell assets without court approval in any transaction not exceeding $250,000. The presence of such a carve-out provision did not affect Blair J.A.’s characterization of the Pine Tree Resorts receivership order as one that did not bring into play the value of the debtor’s property but simply appointed an officer of the court to preserve and monetize those assets subject to court approval. No doubt Blair J.A. reached that conclusion in part because the initial receivership order itself granted court approval for the monetization of assets of less than $250,000. As well, while a sale transaction of less than $250,000 would not require a further approval motion, the court ultimately reviewed the receiver’s conduct for such transactions as part of its periodic review and approval of receiver’s reports. Accordingly, the presence of a “carve-out” provision such as para. 3(k) in the Receivership Order did not alter the essential nature of that order: namely, an order that did not bring into play the value of the debtor’s assets for the purpose of a s. 193(c) analysis.

In its notice of appeal, 30 Roe also asserted that an appeal to the Court is provided under BIA s. 195. That assertion did not accurately describe the operation of s. 195, which deals with stays of orders pending appeal to an appellate court, not with when rights of appeal lie, or with appeal routes.

(2) No.

The proposed appeal did not raise an issue of general importance to insolvency practice or to the administration of justice as a whole. It was also grounded in the fact-specific, discretionary decision of the application judge to refuse a fourth adjournment request by 30 Roe.

Nor did the notice of appeal disclose a prima facie meritorious appeal. The application judge’s reasons disclosed that he fairly considered all relevant factors in refusing the fourth adjournment request, especially in circumstances where, by the hearing date, it was clear 30 Roe had no ability to make payments of principal, remained in default, and offered no tangible prospect of refinancing. There was nothing premature or disproportionate about the application judge’s appointment of a receiver.

30 Roe argued that Rule 15.04(6) of the Rules of Civil Procedure gave it the right until May 20, 2022 to appoint new counsel, with the consequence that the scheduled May 6 hearing had to be adjourned until after that date. 30 Roe’s submission was without any merit. During the course of case managing the matter, the application judge set a timetable that governed the date of the hearing. That timetable took precedence over any time specified in Rule 15.04(6). As the application judges stated, “I made it clear in my March 8, 2022 endorsement that May 6, 2022 was a firm date”. In that circumstance, the language of Rule 15.04(6) that a corporation must appoint counsel “within 30 days” after receiving the order removing former counsel from the record had no effect on the hearing date already set by a judge. It should go without saying that where a removal order was made in the face of a hearing date fixed by the judge managing an application, the corporation obviously must appoint new counsel before the hearing date or risk the hearing proceeding without representation.

Finally, 30 Roe did not demonstrated any palpable and overriding error or unreasonableness in the application judge’s conclusion that 30 Roe “has not acted reasonably and in accordance with my [prior endorsements] by not seeking to identify counsel who could represent it …”

The reasons of the application judge did not disclose that his analysis was based on any error of law. While 30 Roe obviously does not agree with how the application judge weighed the various factors relevant to whether a receiver should be appointed, his decision to appoint a receiver was not unreasonable given 30 Roe’s default and inability to cure its default

Finally, the proposed appeal would unduly hinder the progress of the administration of the receivership. Granting leave would trigger the automatic stay contained in s. 195, thereby preventing the receiver from exercising its power under the Receivership Order to market and sell the Real Property. No purpose would be served by such a delay. It was apparent from the record that 30 Roe has been unable to secure third party financing to take out the KingSett second mortgage notwithstanding several extensions of the mortgage maturity date and the lapse of almost half a year since KingSett initiated its receivership application.

SHORT CIVIL DECISIONS

ALB v Durham Children’s Aid Society, 2022 ONCA 466

[Benotto, Zarnett and Sossin JJ.A.]

Counsel:

A.L.B., acting in person

C. Deyarmond, for the respondent Durham Children’s Aid Society

J. Long and R.J.M. Snell, for the respondent Office of the Children’s Lawyer

Anderson Learning Inc (Bond International College) v Birchmount Howden Property Holdings Inc, 2022 ONCA 469

[Benotto, Zarnett and Sossin JJ.A.]

Counsel:

R. Quance and A. Thakkar, for the appellant

R.B. Macdonald and M. Petrovic, for the respondent

Keywords: Contracts, Real Property, Commercial Leases, Options to Renew, 120 Adelaide Leaseholds Inc v Oxford Properties Canada Ltd, [1993] OJ No 2801 (CA), Housen v Nikolaisen, 2002 SCC 33

COURT OF APPEAL SUMMARIES (JUNE 6, 2022 – JUNE 10, 2022)

By John Polyzogopoulos on June 10, 2022

Jump To: Table of Contents | Civil Decisions | Short Civil Decisions

Good evening.

Following are this week’s summaries of the Court of Appeal for Ontario for the week of June 6, 2022.

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In Antchipalovskaia v Guestlogix Inc, the Court determined that the motion judge erred in treating the respondent’s employment with the appellant from 2011 to 2019 as one continuous period of employment for the purpose of determining her entitlement to common law notice of termination of her employment. Her employment had been terminated following her employer seeking protection under the CCAA, and a release of her claims was ordered by the court in that proceeding. She was then re-hired, but her service prior to the CCAA proceeding should not have counted towards her common law notice entitlement.

The Court also allowed the appeal in another wrongful dismissal case, Rahman v. Cannon Design Architecture Inc. In that case, the motion judge was found to have erred in applying the termination provisions of the employment agreements, given that they violated the Employment Standards Act. It was also an error not to find that a group of companies were the plaintiff’s common employer, and that therefore the corporations were jointly liable to the plaintiff.

Other topics covered this week included judicial review in the statutory accident benefits context, limitation periods and boomerang summary judgment in the solicitor’s negligence context, rescission in the franchise context, “anti-SLAPP”, expediting appeals in the forum non conveniens context, and extension of time to perfect an appeal.

Wishing everyone an enjoyable weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Civil Decisions

Paul v Madawaska Valley (Township), 2022 ONCA 444

Keywords: Torts, Defamation, Misfeasance of Public Office, Civil Procedure, Anti-SLAPP, Courts of Justice Act, R.S.O. 1990, c. C.43, section 137.1, 1704604 Ontario Ltd. v Pointes Protection Association, 2020 SCC 22, 449 D.L.R. (4^th) 1, Bent v Platnick, 2020 SCC 23, Gutowski v Clayton, 2014 ONCA 921

Yatar v. TD Insurance Meloche Monnex, 2022 ONCA 446

Keywords: Contracts, Insurance, Statutory Accident Benefits, Administrative Law, Ontario License Appeal Tribunal, Appeals, Judicial Review, Insurance Act, RSO 1990, c. I.8, 280(3), Licence Appeal Tribunal Act, 1999, S.O. 1999, c 12, Sched G, Judicial Review Procedure Act, RSO 1990, c J 1, 2(1), Statutory Accident Benefits Schedule – Accidents on or after November 1, 1996, O Reg 403/96, Smith v Co-operators General Insurance Co., 2002 SCC 30, Strickland v. Canada (Attorney General), 2015 SCC 37, Honsberger v. Grant Lake Forest Resources Ltd., 2019 ONCA 44, Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, Canadian Pacific Ltd. v. Matsqui Indian Band, [1995] 1 SCR 3, Shearer v Oz, 2021 ONSC 7844

Chuang v. Fogler Rubinoff LLP, 2022 ONCA 440

Keywords: Contracts, Solicitor and Client, Torts, Solicitor’s Negligence, Civil Procedure, Limitations Periods, “Appropriate Means”, Summary Judgment, Boomerang Summary Judgment, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, s. 4, s. 5(1)(a)(iv), Chuang v. Toyota Canada Inc., 2015 ONSC 885, Chuang v. Toyota Canada Inc., 2016 ONCA 584, Chuang v. Toyota Canada Inc., 2016 ONCA 852, Tercon Contractors Ltd. v. British Columbia (Transportation and Highways), 2010 SCC 4, Ferrara v. Lorenzetti, Wolfe Barristers and Solicitors, 2012 ONCA 851

Vale Canada Limited v. Royal & Sun Alliance Insurance Company of Canada, 2022 ONCA 448

Keywords: Contracts, Insurance, Coverage, Civil Procedure, Jurisdiction, Forum Non Conveniens, Comity, Appeals, Expediting, Practice Direction Concerning Civil Appeals at the Court of Appeal for Ontario, s. 12.1.3, James Bay Resources Ltd. v. Mak Mera Nigeria Ltd., 2015 ONCA 781, Teck Cominco Metals Ltd. v Lloyd’s Underwriters, 2009 SCC 11, McWane Cast Iron Pipe Corp. v. McDowell-Wellman Eng’g Co., 263 A.2d 281 (Del. 1970), Vale Canada Limited v Royal & Sun Alliance Insurance Company of Canada, 2021 ONSC 6377

Rahman v. Cannon Design Architecture Inc., 2022 ONCA 451

Keywords: Contracts, Employment, Wrongful Dismissal, Termination Without Cause, Reasonable Notice, Statutory Termination Pay, Enforceability, Illegality, Corporations, Common Employer Doctrine, Employment Standards Act, 2000, S.O. 2000, c. 41, Termination and Severance of Employment, O. Reg. 288/01 s. 2(1), Amberber v. IBM Canada Ltd., 2018 ONCA 571, Wood v. Fred Deeley Imports Ltd., 2017 ONCA 158, Render v. ThyssenKrupp Elevator (Canada) Limited, 2022 ONCA 310, Plester v. Polyone Canada Inc., 2011 ONSC 6068, aff’d 2013 ONCA 47, Oosterbosch v. FAG Aerospace Inc., 2011 ONSC 1538, Waksdale v. Swegon North America Inc., 2020 ONCA 391, leave to appeal refused, [2020] S.C.C.A. No. 292, Rossman v. Canadian Solar Inc., 2019 ONCA 992, O’Reilly v. ClearMRI Solutions Ltd., 2021 ONCA 385, leave to appeal refused, [2021] S.C.C.A. No. 316

Caledon (Town) v. Darzi Holdings Ltd., 2022 ONCA 455

Keywords: Civil Procedure, Appeals, Perfection, Extensions of Time, Orders, Injunctions, Enforcement, Contempt, Carey v. Laiken, 2015 SCC 17, Town of Caledon v. Darzi Holdings Ltd., 2021 ONSC 985, Practice Direction Concerning Civil Appeals at the Court of Appeal for Ontario, s. 17, Rules of Civil Procedure, R.R.O. 1990, Reg. 194, R. v. Joanisse (1995), 102 C.C.C. (3d) 35, R. v. G.D.B., 2000 SCC 22, OZ Merchandising Inc. v. Canadian Professional Soccer League Inc., 2021 ONCA 520, Dickie v. Dickie, 2007 SCC 8

Antchipalovskaia v Guestlogix Inc., 2022 ONCA 454

Keywords: Contracts, Employment, Wrongful Dismissal, Termination Without Cause, Reasonable Notice, Damages, Companies’ Creditors Arrangement Act, RSC, 1985, c C-36, Employment Standards Act, 2000, SO 2000, c 41, s. 9 (1), Courts of Justice Act, RSO 1990, c C 43, s. 134(1)(a), Bardal v Globe & Mail Ltd (1960), 24 DLR (2d) 140 (Ont HC), Manthadi v ASCO Manufacturing, 2020 ONCA 485, Addison v M Loeb Ltd (1986), 25 DLR (4th) 151 (Ont CA), Carpenter v Brains II Canada Inc, 2015 ONSC 6224, aff’d 2016 ONSC 3614 (Div Ct), Minott v O’Shanter Development Co (1999), 42 OR (3d) 321 (CA), McNevan v AmeriCredit Corp, 2008 ONCA 846, Wood v Fred Deeley Imports Ltd, 2017 ONCA 158

2483038 Ontario Inc. v. 2082100 Ontario Inc. , 2022 ONCA 453

Keywords: Contracts, Franchise Agreements, Franchise Law, Remedies, Rescission, Informed Investment Test, Franchisors Associates, Personal Liability, Arthur Wishart Act (Franchise Disclosure), 2000, S.O. 2000, c. 3, ss. 1(1), 6(2), 6(6), Raibex Canada Ltd. v. ASWR Franchising Corp., 2018 ONCA 62, 6792341 Canada Inc. v. Dollar It Limited, 2009 ONCA 385, Sovereignty Investment Holdings, Inc. v. 9127-6907 Quebec Inc. (2008), 303 D.L.R. 4th) 515 (Ont. S.C.); Hi Hotel Limited Partnership v. Holiday Hospitality Franchising Inc., 2008 ABCA 276, 2619506 Ontario Inc. v. 2082100 Ontario Inc., 2021 ONCA 702, 4287975 Canada Inc. v. Imvescor Restaurants Inc., 2009 ONCA 308, Statutory Interpretation, 3rd ed. (Toronto: Irwin Law, 2016)

Short Civil Decisions

Fisher v Soroka, 2022 ONCA 442

Keywords: Contracts, Real Property, Mortgages, Remedies, Foreclosure, Relief from Forfeiture, Civil Procedure, Default Judgments, Setting Aside, Winters v Hunking, 2017 ONCA 909, Intact Insurance Co. v Kisel, 2015 ONCA 205, Mountain View Farms Ltd. v McQueen, 2014 ONCA 194

Toronto-Dominion Bank v Overland R.N.C. Inc., 2022 ONCA 447

Keywords: Contracts, Debtor-Creditor, Guarantees, Civil Procedure, Summary Judgment, Dickinson v Royal Bank of Canada, [1976] 2 S.C.R. 834

CIVIL DECISIONS

Paul v Madawaska Valley (Township), 2022 ONCA 444

[Tulloch, Lauwers and Paciocco JJ.A.]

Counsel:

J.P.R. Cassan and T.J. Harmar, for the appellants

J. Safayeni and K. Bernofsky, for the respondents

facts:

The appellants brought an unsuccessful “anti-SLAPP” motion for an order dismissing the respondent’s action under section 137.1 of the Courts of Justice Act.

The individual respondents were previously involved in litigation with the Township, including a Human Rights Tribunal of Ontario (HRTO) claim. After the HRTO settlement, one of the respondents, Mr. P, wrote to the Township advising them to bring an action against its previous solicitors to recover the costs spent defending rather than mediating the HRTO action. The Township’s counsel wrote an opinion letter to the Township advising it against bringing an action, noting that he was unable to verify that Mr. P was ever called to the Ontario Bar or that he had practiced law in Canada. The opinion letter was discussed at a Town Council meeting, where Council waived solicitor-client privilege.

Council passed a resolution, confirming a by-law accepting counsel’s recommendations. Mr. P forwarded proof of his call to the Ontario Bar and demanded an apology and that the Township donate to a not-for-profit organization. The respondents then sued the appellants for defamation and misfeasance in public office. The appellants argued that the action arose from expressions relating to public interest and put several defences in play in their motion materials. The motion judge dismissed the appellants’ motion to dismiss the respondents’ action. The motion judge found that the claim was in relation to statements that were “expressions” within the meaning of section 137.1(2), and that the expressions related to matters of public interest because the public has a genuine stake in knowing about matters pertaining to Town Council.

The motion judge further found that the respondents had met their burden under section 137.1(4)(a)(i) and (ii), both of which are required in order for an anti-SLAPP motion to be dismissed. The respondents were able to show that the claims had a prospect of success and that there were grounds upon which each of the defences could realistically be rejected, based on the law and on the record.

issues:

(1) Did the motion judge err in her understanding and application of weighing different interests?

(2) Did the motion judge err by stepping into the breach on behalf of the self-represented respondents and by doing the analysis of the defences available to the appellants on which the respondents made no submissions?

(3) Did the motion judge err in her analysis of absolute privilege and its availability to the appellants?

(4) Did the motion judge err procedurally?

holding:

Appeal dismissed.

reasoning:

(1) No.

The Court did not find that the motion judge erred in her application of the weighing exercise. The Court concluded that the motion judge fully recognized that the “final weighing exercise” was “the fundamental crux of the analysis”. The Court found no reviewable error in the motion judge’s conclusion that allowing this action to proceed to a determination on the merits gives appropriate weight to the public interest in seeing harm arising from defamatory statements remedied, while also addressing the public interest in protecting the type of expression in which the appellants engaged.

(2) No.

The Court did not accept the argument put forth by the appellants that the motion judge effectively reversed the onus on the respondents under section 137.1(4) of the Courts of Justice Act. The Court held that the defences to a defamation action are obvious and were in fact raised by the appellants themselves in argument. The motion judge was obliged to address the arguments the appellants adduced concerning the provisional defences, based on the evidence and record before her, and did not err in her analysis of them.

(3) No.

The motion judge did not err in declining to address more fully the issue of absolute privilege as a defence. The Court agreed with the motion judge that this kind of motion was not the place for a determination of this issue, which could play a role in the appellants’ defence of the defamation action.

(4) No.

The appellants were obliged to bring a motion at the beginning of the hearing to strike out portions of the materials filed by the respondents. The appellants were largely successful but maintained that the exercise disadvantaged them because they could not know until the decision was rendered what material the motion judge had accepted for the purpose of the argument on the merits. The Court agreed that it would have been better had the procedural motion proceeded well before the argument on its merits, but accorded this argument no weight because the appellants pointed to no specific material and to no specific prejudice that this procedural issue might have caused them.

Yatar v. TD Insurance Meloche Monnex, 2022 ONCA 446

[Lauwers, Nordheimer and Zarnett JJ.A.]

Counsel:

S. Dewart, I. McKellar, and R. Ward for the appellant

D. Greenside and R. Groskopf for the respondent TD Insurance Meloche Monnex

V. Crystal and T. Guy for the respondent License Appeal Tribunal

facts:

UY appealed the decision of the Divisional Court which dismissed her application for judicial review of a decision of the Licence Appeal Tribunal (the “Tribunal”).

UY was injured in a motor vehicle accident on February 7, 2010. At the time, she was insured under a motor vehicle liability policy of insurance issued by the respondent, TD Insurance. UY submitted an Application for Accident Benefits, as well as an Employer’s Confirmation Form, and elected to claim Income Replacement Benefits (“IRBs”). She also claimed housekeeping and home maintenance benefits pursuant to the Statutory Accident Benefits Schedule – Accidents on or after November 1, 1996, O Reg 403/96 (“the SABS”). TD Insurance initially paid benefits, but on January 7, 2011, it wrote to the appellant and stated that payment of IRBs, housekeeping, and home maintenance benefits had been stopped effective January 4, 2011, because it had not received a completed disability certificate within the time requested.

In January, she attended two insurer’s medical examinations, one with a psychologist and one with a physiatrist, for the purpose of determining her entitlement to IRBs, housekeeping, and home maintenance benefits. TD Insurance wrote to the appellant and denied her claim for housekeeping and home maintenance benefits based on the results of the examinations but allowed her claim for IRBs with continued monitoring. On September 19, 2011, TD Insurance wrote the appellant to deny her claim for IRBs and to advise that payment of her IRBs would be stopped effective September 28, 2011.

The appellant applied for mediation at the Financial Services Commission of Ontario (“FSCO”) on September 13, 2012 to dispute the denial of her IRBs and housekeeping and home maintenance benefits.

On April 29, 2019, the Tribunal adjudicator found that the appellant’s claim was statute-barred because it had been commenced more than two years after the denial of benefits by TD Insurance. The appellant requested a reconsideration of that decision. On April 23, 2020, the adjudicator confirmed his decision.

issues:

(1) Did the Divisional Court err in limiting judicial review, in cases where there has been a statutory appeal from a Tribunal decision about SABS, to “exceptional circumstances”?

(2) Was the Tribunal’s reconsideration decision reasonable?

holding:

Appeal dismissed.

reasoning:

(1) Yes.

The Court agreed that judicial review should be limited to rare cases where adequate alternative remedies are insufficient to address the particular factual circumstances of a given case. However, the Court disagreed with the use of the term “exceptional circumstances”.

While the Court agreed with the point that the Divisional Court was attempting to make in its reasons, the use of the language “exceptional circumstances” was unfortunate. This wording gives rise to confusion regarding access to judicial review as a remedy in cases where there is a statutory appeal.

The Divisional Court was correct in concluding that the existence of an adequate alternative remedy was a valid reason not to exercise its discretion to hear and determine a judicial review application. In reaching that conclusion, the Divisional Court properly considered the various factors from Strickland.

The legislation regarding the resolution of disputes over SABS intended to greatly restrict resort to the courts for the determination of those disputes.

Having said that, the Court recognized that the appellant still had the remedy of an application for judicial review available to her. That availability is clear from a number of sources such as s 280(3) of the Insurance Act. The Judicial Review Procedure Act, RSO. 1990, c J 1, provides, in s 2(1), that a “court may, despite any right of appeal, by order grant any relief” by way of judicial review. Further, the case law also makes it clear that “legislatures cannot shield administrative decision making from curial scrutiny entirely”: Canada (Minister of Citizenship and Immigration) v Vavilov, 2019 SCC 65, at para 24. However, this did not change the analysis nor did it change the fact that judicial review is a discretionary remedy.

When the Divisional Court said that it would only exercise its discretion to hear and determine an application for judicial review in exceptional circumstances, it was attempting to communicate that it would only be in rare cases that the remedy of judicial review would be exercised, given the legislated scheme for the resolution of disputes over SABS. The decision of the Divisional Court recognizes the legislative intent to limit access to the courts regarding these disputes. This analysis is consistent with the principles regarding the centrality of legislative intent expressed in Vavilov.

The Court agreed with the Divisional Court’s approach, which essentially concluded that judicial review should be restricted to those rare cases where the adequate alternative remedies of reconsideration, together with a limited right of appeal, were insufficient to address the particular factual circumstances of a given case.
Removing the requirement for exceptional circumstances does not change the rationale or result of the Divisional Court’s decision. It remains true that it will only be a rare case where the remedy of judicial review will be properly resorted to, given the alternative remedies that are available to an unsuccessful party.

(2) Yes.

The adjudicator found that, when the IRBs were finally denied by the letter of September 19, 2011, the appellant was fully informed of the dispute resolution process. Consequently, he concluded that there was no deficiency that undermined the denial of the IRBs through the September 19, 2011 letter. The fact that the appellant had not launched her application to the Tribunal until March 16, 2018, meant that it was outside of the limitation period. The appellant failed to demonstrate that there was anything unreasonable in the conclusion that the adjudicator reached in his reconsideration decision.

Chuang v. Fogler Rubinoff LLP, 2022 ONCA 440

[Gillese, Trotter and Harvison Young JJ.A.]

Counsel:

P. Wardle and E. Rankin, for the appellants Fred Tayar & Associates Professional Corporation

M. Kestenberg, for the appellants, Fogler Rubinoff LLP

T. Danson and M. Delavar, for the respondents

Keywords: Contracts, Solicitor and Client, Torts, Solicitor’s Negligence, Civil Procedure, Limitations Periods, “Appropriate Means”, Summary Judgment, Boomerang Summary Judgment, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, s. 4, s. 5(1)(a)(iv), Chuang v. Toyota Canada Inc., 2015 ONSC 885, Chuang v. Toyota Canada Inc., 2016 ONCA 584, Chuang v. Toyota Canada Inc., 2016 ONCA 852, Tercon Contractors Ltd. v. British Columbia (Transportation and Highways), 2010 SCC 4, Ferrara v. Lorenzetti, Wolfe Barristers and Solicitors, 2012 ONCA 851

facts:

The respondent, Dr. C and companies, entered into a Letter of Commitment (“LOC”) with Toyota Canada Inc. (“Toyota”) to build and operate a Lexus dealership in Toronto. Toyota terminated the LOC after the respondents failed to meet certain deadlines set out in the agreement. The respondents commenced an action against Toyota, alleging that the termination was unlawful. They were unsuccessful. An appeal to the Court was dismissed (Chuang v. Toyota Canada Inc., 2016 ONCA 584), as was a motion to reopen the appeal (Chuang v. Toyota Canada Inc., 2016 ONCA 852). The Supreme Court of Canada refused leave to appeal ([2016] S.C.C.A. No. 568).

Following the dismissal of the leave application, the respondents commenced an action in negligence against the appellants for failing to provide competent advice concerning the enforceability of the exclusion of liability clause. They claimed a loss of approximately $28 million in damages and $3 million in legal fees.

There are two sets of appellants. Fogler Rubinoff LLP, N. Perfetto, I. Katchin, and D. Levangie (“the Fogler Rubinoff appellants”) represented the respondents until mid-trial, when they were permitted to withdraw. The trial was adjourned until new counsel came on board.

The second set of appellants, Fred Tayar and Associates Professional Corporation, F. Tayar, and C. Linthwaite (“the Tayar appellants”), represented the respondents for the remainder of the trial. The Tayar appellants assumed the same litigation strategy at trial as the Fogler Rubinoff appellants. Both sets of appellants attempted to circumvent the exclusion of liability clause in the LOC, but only on a single and narrow basis.

The appellants moved for summary judgment. They claimed that the respondents’ claims were discoverable before the Supreme Court of Canada refused leave to appeal on March 30, 2017, within the two-year limitation period in s. 4 of the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B. The respondents advanced the position that their claims were not discoverable until the Supreme Court of Canada refused leave to appeal; this is when they sought legal advice about the professional competence of their previous counsel.

The motion judge dismissed the summary judgment motion, held that the limitations defence be dismissed, and directed that the case proceed to trial on the merits.

issues:

(1) Did the motion judge err in dismissing the motion to dismiss the action as statute-barred and dismissing the limitation period defence?

holding:

Appeal dismissed.

reasoning:

(1) No.
The motion judge held that the claim was not discoverable until the Supreme Court of Canada refused leave to appeal. In the alternative, the motion judge held that, if the claim was discoverable earlier, and outside the two-year limitation period, commencing an action was not “an appropriate means to seek to remedy it” within the meaning of s. 5(1)(a)(iv) of the Limitations Act, 2002. Even though the respondents did not bring a cross-motion for a determination that their claim was timely, the motion judge found it appropriate to grant summary judgment in favour of the respondents and dismissed the limitations defence.

The motion judge found that the respondents did not discover their claim until after the Supreme Court of Canada refused leave to appeal. The motion judge rejected the appellants’ position that there were earlier points in time when the respondents would have been aware of the material facts necessary to ground their claim.

The Court of Appeal found no error in the motion judge’s conclusion that the claim was not discoverable until after the refusal of leave to appeal on March 30, 2017, a procedural step that was recommended to them by the appellants. It was at that critical moment, when their case was irretrievably lost, that the respondents sought an opinion about the appellants’ professional competence. Having commenced this action on March 28, 2019, the respondents’ claim is not statute-barred.

Vale Canada Limited v. Royal & Sun Alliance Insurance Company of Canada,, 2022 ONCA 448

[Lauwers J.A. (Motion Judge)]

Counsel:

A. Lewis, for the appellant

D. Smith, for the respondents

facts:

The moving parties, Vale Canada Limited, Vale Japan Limited, PT Vale Indonesia Limited, and Vale Europe Limited (collectively, “Vale”), moved to expedite the appeal of the Superior Court’s order made pursuant to reasons for decision reported at 2022 ONSC 12, currently scheduled for September 14, 2022.

Vale is a mining company that has been required to investigate and remediate its environmental impact. Vale purchased insurance policies from various primary and excess insurers, some of which are respondents. The claim pertains to numerous sites in Canada and Ontario, one in the United Kingdom, and none in New York. Vale was sued by Travelers Casualty & Surety Company in the Supreme Court of the State of New York, County of New York: Commercial Division Part 53. Vale responded by immediately suing Travelers in Ontario, and subsequently brought a second action in Ontario against its many insurers.

Myers J. (2021 ONSC 6377) held that Ontario had jurisdiction over most of the defendants and that they had not established that New York was a more convenient forum for the claims.

Vale moved in the New York proceeding to dismiss Traveler’s complaint and other crossclaims against Vale, based on the principle of forum non conveniens. Borrok J.S.C. dismissed the motion and held that dismissal based on forum non conveniens was not appropriate.

issues:

(1) Should the Court grant a motion to expedite the hearing of the appeal?

holding:

Motion dismissed.

reasoning:

(1) No.
The Court first noted that under s. 12.1.3 of the Practice Direction Concerning Civil Appeals at the Court of Appeal for Ontario, in order to expedite these appeals, the Court must be “satisfied that the urgency of the matter requires an earlier hearing date” To aid in this determination, the Court considered the issue of comity in relation to which of Ontario or New York is, on all the facts, the more convenient forum in which to try the case. As the Court observed in James Bay Resources Ltd, comity is not a stand-alone factor but is part of the case-specific assessment of forum non conveniens.

Vale argued the driving factor for expedition of these appeals was the lack of the progression of the underlying Ontario Actions, which should proceed in tandem with New York pending a final determination on jurisdiction. The Court stated that the issue should not turn on which action was started first (New York), or which jurisdiction first issued a decision on forum non conveniens (Ontario). This form of competition between jurisdictions was wrong and unprincipled: Teck Cominco Metals Ltd, at paras. 29-30. The issue of which court should decide the litigation should be determined on true forum non conveniens principles.

As the Court observed in Teck Cominco Metals Ltd., it would not be desirable to allow technicalities such as how long it takes a particular judge to assert jurisdiction, to determine the outcome. Considerations that have little or nothing to do with where an action is most conveniently or appropriately heard, should not be allowed to carry the day. A holistic approach, in which the avoidance of a multiplicity of proceedings is one factor among others to be considered, better serves the purpose of fair resolution of the forum non conveniens issue with due comity to foreign courts.

The Court further noted that courts should avoid facilitating an “unseemly race by each party to trial and judgment in the forum of its choice”: McWane Cast Iron Pipe Corp. The forum non conveniens argument in this case will fall to be determined not by lower court judgments on either side of the border, but by the respective appeal courts in both jurisdictions.
The Court concluded that there was no urgency to the appeal that would justify expediting it by several weeks. Doing so would only embroil the Court in an “unseemly race”.

Rahman v. Cannon Design Architecture Inc., 2022 ONCA 451

[Gillese, Trotter and Harvison Young JJ.A]

Counsel:

S. Moreau and K. Duff, for the appellant

D. A. Whitten, S. Ostrowski and N. Halum, for the respondents

facts:

The appellant’s employment with a group of US and Canadian companies together called CannonDesign (the respondents) was governed by two agreement, an Offer Letter and an Officer Agreement (together the “Employment Contracts”). The Offer Letter referred to the Officer Agreement and provided that in the event of conflict between the two, the Offer Letter will govern.

There were two “just cause” provisions, one in the Offer Letter and the other in the Officer Agreement. The Offer Letter provision stated that no notice will be given if there is just cause to terminate. The just cause provision in the Officer Agreement stated that FR would receive one month’s notice according to Paragraph 3(a). While the two provisions conflicted, because of the stipulation in the Offer Letter that it will govern in the event of conflict, it was the just cause provision in the Offer Letter that governed.

FR was given four weeks of base salary when her employment was terminated, without notice or cause. FR sued the respondents, claiming damages for wrongful dismissal. FR claimed she was entitled to a longer period of reasonable notice prior to termination and damages for CannonDesign’s failure to provide such notice. She then moved for summary judgment, asking the court to declare that: (1) the termination provisions in her employment contracts were void because they conflicted with the Employment Standards Act, 2000, S.O. 2000, c. 41, (the “ESA”); and (2) the respondents were her common employers.

The motion judge interpreted the termination provisions as complying with the ESA and concluded that they governed FR’s termination. The motion judge also concluded that only one of the respondents, CDAI, alone had employed FR and so dismissed the action as against the other corporate respondents. The motion judge dismissed the action and ordered FR to pay the respondents costs of $80,000. FR appealed.

issues:

(1) Did the motion judge err in concluding that the termination provisions of the Employment Contracts govern the termination of her employment?

(2) Did the motion judge err in concluding that the respondents were not her common employers?

holding:

Appeal allowed.

reasoning:

(1) Yes.

The motion judge committed an extricable error of law reviewable on a correctness standard when he allowed considerations of FR’s sophistication and access to independent legal advice, coupled with the parties’ subjective intention to not contravene the ESA, to override the plain language in the termination provisions in the Employment Contracts: Amberber v. IBM Canada Ltd. It is the wording of a termination provision which determines whether it contravenes the ESA – even compliance with ESA obligations on termination does not have the effect of saving a termination provision that violates the ESA: Wood v. Fred Deeley Imports Ltd. The operative just cause provision was the one in the Offer Letter (the “Operative Just Cause Provision”). The Operative Just Cause Provision stated that no notice or payment will be given if there is just cause to terminate.

However, ESA notice and termination pay must be given for all terminations, even those for just cause, except for “prescribed employees”: ESA, s. 55. Section 2(1) of the ESA regulation Termination and Severance of Employment provides: “An employee who has been guilty of wilful misconduct, disobedience or wilful neglect of duty that is not trivial and has not been condoned by the employer is not entitled to notice of termination or termination pay.” The wilful misconduct standard requires evidence that the employee was “being bad on purpose”: Render v. ThyssenKrupp Elevator (Canada) Limited.

On its plain wording, the Operative Just Cause Provision gave CannonDesign the right to terminate FR’s employment without notice or payment, for conduct that constituted just cause alone. That meant the Operative Just Clause Provision contravened the ESA and s. 5 rendered it void. Section 5 provides that no employer shall contract out of an employment standard and any such contracting out is void.

The Court has repeatedly held that if a termination provision in an employment contract violates the ESA – such as a “no notice if just cause” provision – all the termination provisions in the contract are invalid. Accordingly, the provisions are void and cannot govern the termination of FR’s employment.

(2) Yes.

Further, the motion judge made palpable and overriding factual errors in concluding that FR had been employed by CDAI alone. The undisputed evidence was that one of the US respondents, The Cannon Corporation, played a significant role in establishing FR’s compensation and administering payment.

The evidence was clear that the respondents were FR’s common employers. The common employer doctrine considered in O’Reilly v. ClearMRI Solutions Ltd., recognizes that an employee may simultaneously have more than one employer. In O’Reilly, Zarnett J.A. stated that conduct which reveals that effective control over the employee resided with those members is “conduct most germane to showing an intention that there was an employment relationship with two or more members of an interrelated corporate group.”

The record in the proceeding contained a body of uncontested evidence showing that, from the outset of her employment through to its end, FR was directed and controlled by senior managers employed by The Cannon Corporation, and that the respondents were sufficiently intertwined and exerted sufficient control over FR that they must be considered common employers. As such, they were jointly and severally liable for any damages payable to FR.

Caledon (Town) v. Darzi Holdings Ltd., 2022 ONCA 455

[Brown J.A. (Motion Judge)]

Counsel:

K. Sonshine, for the moving party

R. Uukkivi and M. Winch, for the responding party

facts:

The appellants moved to set aside the Registrar’s order dismissing their appeal and for an extension of time to perfect the appeal. The motion was brought in the context of a civil proceeding that found them in contempt of an injunction order and sentenced them to a fine of $1 million jointly and severally.

The appellants operated construction businesses, where they stored a large of amount of equipment and materials on several pieces of the respondent’s land which they believed contravened local by-laws. The respondents were granted an injunction on September 12, 2019, which was violated by the appellants. The appellants were found in contempt of the injunction order and ordered to pay fines to the respondents. Myers J. was satisfied that the respondents had proven the three elements of contempt: Carey v. Laiken. The appellants asked the court to exercise its discretion to not grant a contempt order, largely because of economic challenges the appellants contended the pandemic posed to their businesses. Myers J. declined to exercise discretion to withhold a contempt remedy, and found the appellants guilty of contempt of court for breaching the injunction order: Town of Caledon v. Darzi Holdings Ltd. at para 29.

The parties subsequently entered into a consent agreement on March 8, 2022, under which the appellants would deliver, on March 8, all materials required to perfect the appeal and would perfect their appeal by March 31, 2022. The court issued the order on April 14, 2022 (the “Myers Order”), after the agreed upon date for perfection of the appeal. The appellants did not perfect their appeal by March 31, 2022.

On March 18, 2022, the appellants served and filed an amended notice of appeal, which alleged ineffective assistance of counsel by the appellants’ former counsel as a new ground of appeal.

The Registrar of the Court had issued an order dated March 31, 2022, dismissing the appeal for delay, which the appellants received on April 12, 2022.

issues:

(1) Should the Registrar’s dismissal order be set aside and the time to perfect the appeal be extended?

holding:

Motion granted.

reasoning:

(1) Yes.

The overarching principle governing a request to set aside a Registrar’s dismissal order and for an extension of the time to perfect an appeal was whether the justice of the case requires granting or refusing the relief sought. As part of the analysis, the Court considered several factors: (i) whether the appellant formed an intention to perfect the appeal within the time prescribed by the Rules of Civil Procedure; (ii) whether the appellant moved with due dispatch to set aside the dismissal order (a matter not in dispute on this motion); (iii) the length of the delay; (iv) the explanation for the delay; (v) the merits of the proposed appeal; and (vi) any prejudice to the respondent.

Regarding the first factor, the Court distinguished intention to appeal a sentence within the time prescribed by the Rules, with intention to perfect. The Court was skeptical of the appellants intention to perfect within the prescribed time.

The second factor was not in dispute on this motion. Regarding the third factor, the Court observed that the applicant filed their motion to set aside on a reasonably prompt basis, given that they faced institutional delay on part of the Court.

Regarding the fourth factor, the Court concluded that the applicant’s failure to provide a reasonable explanation for their delay in contacting past counsel weighed against them, since ineffective assistance of counsel was the ground of appeal the appellant sought to rely on in failing to perform their perfection agreement.

Regarding the fifth factor, the appellants argued two grounds of appeal against the sentence imposed of a fine of $1 million on a joint and several basis: first, they contended that the sentence was unfit and disproportionate; and second, they contended that former counsel provided ineffective assistance that resulted in a miscarriage of justice and prejudice. The Court took issue that the appellants had provided any authority of the law governing civil proceedings, and instead, provided authorities related to criminal proceedings. With respect to civil proceedings, the Court stated that the law governing civil proceedings recognized a right to effective assistance of counsel which, if breached, could occasion a miscarriage of justice that could result in setting aside an order in a civil contempt proceeding: OZ Merchandising Inc. v. Canadian Professional Soccer League Inc. at para. 44. The Court concluded that the merits of the appellants’ ineffective assistance of counsel ground of appeal were regarded as very weak in determining the motion to set aside and extend.

Regarding the sixth factor, the respondents alleged that the Court should exercise discretion and dismiss the motion on the basis that the appellants’ alleged continuing breach of the injunction order disentitled them to a hearing of their sentence appeal: Dickie v. Dickie at para. 6. Brown J.A contended that although a panel has the authority to refuse to entertain an appeal, a single judge may not have the same authority.

The Court then considered several factors to weigh and balance as part of determining the overall justice of the case.

On the one hand, a number of factors weighed against granting the appellants’ motion: the Court concluded that the appellants did not intend to perfect their appeal within the time prescribed by the Rules, nor did they intend to perfect their appeal within a reasonable time after receiving the issued and entered Myers Order; the appellants did not perform their obligations under the March 8 agreement to perfect; the delay of the appellants in initiating steps to take out the Myers Order was not reasonable; the appellants did not provide a reasonable explanation about their delay in asserting ineffective assistance of counsel as a ground of appeal; and, finally, that their ground of appeal was very weak.

On the other hand: the Court concluded the delay in perfecting the appeal was not lengthy; the appellants had an arguable ground of appeal regarding the fitness of the sentence, in terms of the amount of the fine; and the Town did not adduce direct evidence of prejudice, although certainly the appellants’ delay in and of itself gave rise to prejudice.

Given the existence of an arguable ground of appeal based on the size of the fine, together with the ability of the Court to manage the balance of the appeal’s pre-hearing steps in a way to minimize the prejudice of delay to the Town, the Court decided to exercise discretion and set aside the Dismissal Order, but on strict terms, which also constituted the directions sought by the appellants on this motion.

Antchipalovskaia v Guestlogix Inc., 2022 ONCA 454

[Trotter, Coroza and Favreau JJ.A.]

Counsel:

L. Scott for the appellants

A. Rosenberg for the respondents

facts:

The appellant, Guestlogix Inc., appealed from a judgment finding that the respondent, MA, was entitled to twelve months notice for dismissal without cause. The twelve month notice period was partially based on the motion judge’s finding that the respondent was continuously employed by the appellant for eight years, from 2011 to 2019.

However, the appellant terminated the respondent’s employment in 2016 in the context of creditor protection proceedings under the Companies’ Creditors Arrangement Act (the “CCAA”). As part of those proceedings, the Superior Court made an order providing for the payment of creditors, including the respondent, given her status as a former employee at the time the order was made, and explicitly releasing any claims by creditors called the Plan of Compromise and Arrangement (the “Plan”). The appellant subsequently re-hired the respondent on the same terms as her previous employment. The appellant then terminated the respondent’s employment without cause in 2019.

The respondent brought an action for wrongful dismissal, claiming that she was entitled to common law notice. The motion judge found that the termination provisions in the employment contract were invalid because they did not comply with the minimum requirements in the Employment Standards Act (the “ESA”). Having found that the termination provisions were invalid, the motion judge went on to consider the respondent’s entitlement to common law notice. In that context, the motion judge held that the respondent’s employment with the appellant should be treated as continuous from 2011 to 2019. In doing so, she noted that the appellant issued a Record of Employment that identified the respondent’s first day of work as July 5, 2011, and that the appellant calculated the respondent’s entitlements under the ESA on the basis of 7 years and 11 months of employment. When assessing the respondent’s entitlement at common law, the motion judge noted that the respondent did not sign a release in the CCAA proceedings but she did not consider the significance of the court ordered release.

Ultimately, the motion judge held that twelve months notice was appropriate in the circumstances. She awarded damages to the respondent “reflecting a twelve (12) month notice period, less the amount of the [respondent]’s Claim in the CCAA proceedings and the amounts the [respondent] has been paid as a result of her termination of employment.”

issues:

(1) Did the motion judge err in treating the respondent’s employment with the appellant from 2011 to 2019 as one continuous period of employment for the purpose of determining her entitlement to common law notice?

(2) If so, what notice period was the respondent entitled to at common law?

holding:

Appeal allowed.

reasoning:

(1) Yes.

The motion judge erred in failing to give effect to the termination of the respondent’s employment in 2016 and the release granted in the CCAA proceedings. In determining the respondent’s entitlement to common law notice, the motion judge should have treated the respondent’s period of employment as running from 2016 to 2019. However, the Court disagreed with the appellant’s argument that the respondent’s period of employment from 2011 to 2016 should play no role in determining the notice period. Rather, the respondent’s years of employment prior to 2016 should have been taken into account in determining her notice period as her prior years of service provided a benefit to the appellant.

While the motion judge was aware that the respondent’s employment had been terminated in the context of the CCAA proceedings and that there was a court ordered release, she did not address whether and to what extent these circumstances should impact the length of common law notice, which was an error in principle. The motion judge recognized that, under the ESA, the respondent’s employment with the appellant was to be treated as one continuous period. However, contrary to the decision in Manthadi v ASCO Manufacturing, the motion judge failed to address the “sharp distinction” between the calculation of the respondent’s length of employment under s. 9(1) of the ESA and at common law. In determining the respondent’s length of employment for the purpose of deciding the common law notice period, the motion judge should not have relied on the deemed continuity of employment under s. 9(1) of the ESA.

While the circumstances that gave rise to the termination and resumption of the respondent’s employment were different than in Manthadi, the termination and CCAA release were nevertheless relevant to determining the respondent’s length of employment and the appropriate notice period. By failing to consider the effect of the termination and CCAA release, the motion judge erred in treating the respondent’s employment with the appellant as continuous.

The motion judge gave no consideration to the interruption of the respondent’s employment and the CCAA release when weighing the factors in Bardal v Globe & Mail Ltd. While Manthadi provided that a court can give “some recognition” to an employee’s prior experience when dealing with successor employer cases, the Court noted that the current case was different than treating the two separate periods of employment as continuous. When dealing with a successor employer, the court must look at all the circumstances, including the intentions of the parties, in deciding what effect the employee’s earlier period of employment should have on the notice period. By failing to do so, the motion judge made an error in principle that tainted her analysis of the Bardal factors.

In addition, a twelve month notice period was already at the high end of the range for someone with the respondent’s responsibilities and qualifications who worked for a period of approximately eight years. It did not fall within the acceptable range for someone who worked for a period of 2.75 years in circumstances where the CCAA court ordered release clearly contemplated that the appellant would be released from any liabilities predating the implementation of the Plan. The court found that the motion judge’s determination that twelve months was an appropriate notice period should be set aside.

(2) Seven months.

The court found that a notice period of seven months was appropriate in the circumstances. This notice period was longer than the notice period the respondent would have been entitled to if she had first started her employment with the appellant in 2016, thereby accounting for the benefit the appellant received from her previous period of employment. At the same time, this notice period recognized and gave effect to the intent of the court ordered release in the CCAA proceedings, which was to release the appellant from liabilities arising prior to the implementation of the Plan.

2483038 Ontario Inc. v. 2082100 Ontario Inc, 2022 ONCA 453

[Feldman, Pepall and Tulloch JJ.A.]

Counsel:

B. Hanuka and A. Pugh, for the appellants

A.D.J. Dick and D. Hamson, for the respondents

facts:

The parties entered into a franchise agreement to operate a “Fit for Life” restaurant in Oakville. After a brief period of operation, the respondents sought to rescind the agreement on the ground that they had not received the appropriate financial disclosure under the Arthur Wishart Act (Franchise Disclosure), 2000 (“Wishart Act”). They sought compensation and damages from the appellants.

The trial judge held that the respondents were entitled to rescind the agreement under s. 6(2) of the Wishart Act and found S.D. to be personally liable as a franchisor’s associate.

issues:

(1) Did the trial judge err by not applying the “informed investment” test to the rescission analysis?

(2) Did the trial judge err in determining that S.D. was a “franchisor’s associate”?

holding:

Appeal dismissed.

reasoning:

(1) No.

There was no error in the trial judge’s interpretation and application of the “informed investment” test. The trial judge was correct in her conclusion that the Court’s decision in Raibex Canada Ltd. v. ASWR Franchising Corp. does not import the requirement of an inability to make an “informed investment” into the defective certificate analysis. Requiring a franchisee to demonstrate they were unable to make an informed investment in a deficient certificate case would undermine one of the purposes of the Wishart Act. An important purpose of franchise disclosure certificates is that they attach personal liability to the signatories, which is intended to incentivize the signatories to ensure the contents of the disclosure documents are accurate. The Court agreed with the trial judge’s finding that the attachment of personal liability to signatories is a free-standing objective and is not tied to any impact on the recipient.

The Court agreed with the conclusion of the trial judge that the absence of the certificate is a fatal flaw in the disclosure. Therefore, the franchisees had a right to rescind the franchise agreement without penalty under s. 6(2) of the Wishart Act, and did so lawfully.

(2) No.

Both the appellants and respondents agreed that S.D., as the sole director and shareholder, had control over the franchisor, and therefore met the first step of the “franchisor’s associate” test under the Wishart Act. The trial judge made findings of fact based on the evidentiary record that the statements made at pages two to four of the disclosure documents were “representations” for the purpose of granting, marketing, or offering to grant the franchise. S.D. also gave sworn testimony that he intended to be personally liable for his signature. Based on these facts, S.D. was directly involved in the grant of the franchise under the second step of the “franchisor’s associate” test. The appellants’ proposed reading of the statute would contravene established principles of statutory interpretation. In interpreting the Wishart Act, the Court has emphasized the need to defer to the legislature’s wording.

The representations were made directly to the franchisee parties because S.D. reviewed the disclosure documents, permitted his signature to be applied after the statements he wrote at pages two to four, and knew that this package would be provided to prospective franchisees. There was no error in the trial judge’s reasons or application of the law.

SHORT CIVIL DECISIONS

Fisher v Soroka, 2022 ONCA 442

[van Rensburg, Harvison Young and Copeland JJ. A]

Counsel:

D.M. Steele and D.W. Veinot, for the appellant

S.D. Gadbois, for the respondents

Toronto-Dominion Bank v Overland R.N.C. Inc, 2022 ONCA 447

[Tulloch, Miller, and Trotter JJ. A]

Counsel:

P.J. Pape and C. Senese, for the appellants

M.R. Kestenberg and B.C. Jusko, for the respondent

Keywords: Contracts, Debtor-Creditor, Guarantees, Civil Procedure, Summary Judgment, Dickinson v Royal Bank of Canada, [1976] 2 S.C.R. 834

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Table of Contents

CIVIL DECISIONS

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SHORT CIVIL DECISIONS

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John Polyzogopoulos Blaney McMurtry LLP 416.593.2953 Email

Table of Contents

CIVIL DECISIONS

Counsel:

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holding:

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facts:

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holding:

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Counsel:

facts:

issues:

holding:

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Counsel:

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holding:

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facts:

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email