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Good afternoon.

Following are this week’s summaries of the Court of Appeal for Ontario for the week of April 15, 2024.

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In Denman v Radovanovic, the Court examined the extent of a physician’s duty to obtain informed consent for elective, multi-step medical treatments, and the responsibility for obtaining such informed consent among the several physicians involved in treatment. The decision confirms that the duty to disclose the risks of treatment and to obtain informed consent does not only fall on the physician performing the procedure. It can extend to other consulting physicians who are involved in the treatment.

In Johnson v. Lakeridge Health Corporation, another MedMal case, the Court dismissed the appeal and upheld the trial judge’s finding that a prima facie case on the issue of causation was not established, notwithstanding that negligence had been conceded.

In Matos v. Driesman, the appellant father’s appeal against an order following an uncontested trial seeking to modify child support was dismissed. Since the father’s pleading had been struck for failure to comply with his disclosure obligations, he was found to have no standing to appeal.

Other topics included the right to appeal from an order made in bankruptcy and the dismissal of a motion for security for costs in a family law appeal.

Wishing everyone a nice weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Table of Contents

Civil Decisions

Matos v. Driesman, 2024 ONCA 271

Keywords: Family Law, Child Support, Arrears, Variation, Civil Procedure, Disclosure, Orders, Enforcement, Striking Pleadings, Uncontested Trials, Motions to Change, Matos v. Driesman, 2018 ONCA 660, Freedman v. Freedman, 2022 ONSC 4823, Colucci v. Colucci, 2021 SCC 24

Cardillo v. Medcap Real Estate Holdings Inc., 2024 ONCA 278

Keywords: Bankruptcy and Insolvency, Transfers Under Value, Civil Procedure, Appeals, Leave to Appeal, Bankruptcy and Insolvency Act, RSC, 1985, c. B-3, ss 193(a)-(e), Courts of Justice Act, RSO, 1990, c. C.43, s. 7(5), Rules of Civil Procedure, r. 61.16(2.2), Courts of Justice Act, RSO 1990, c C 43, ss. 6, 7(3)(5),  Business Development Bank of Canada v. Pine Tree Resorts Inc., 2013 ONCA 282, 2403177 Ontario Inc. v. Bending Lake Iron Group Limited, 2016 ONCA 225, Robson (Re) (2002), 33 CBR (4th) 86 (Ont. C.A.), DeMarco v. Nicoletti, 2017 ONCA 417, Yaiguaje v. Chevron Corporation, 2017 ONCA 827, Struik v. Dixie Lee Food Systems Ltd., 2018 ONCA 22, Hillmount Capital Inc. v. Pizale, 2021 ONCA 364

Denman v. Radovanovic, 2024 ONCA 276

Keywords: Torts, Negligence, Medical Malpractice, Duty of Care, Duty of Disclosure, Informed Consent, Causation, Civil Procedure, Evidence, Admissibility, Hearsay, Opinion, Experts, Bias, Costs, Health Care Consent Act, 1996, SO 1996, c. 2, Sched A, s.10(1), s. 29(1), Rules of Civil Procedure, r. 57.01, Reibl v Hughes, [1980] 2 SCR 880, Hollis v Dow Corning Corp, [1995] 4 SCR 634, Van Dyke v Grey Bruce Regional Health Centre (2005), 255 DLR (4th) 397 (Ont CA), Watson v Dr Shawn Soon, 2018 ONSC 3809, Bollman v Soenen, 2014 ONCA 36, Felde v Vein and Laser Medical Centre (2003), 68 OR (3d) 97 (CA), Ross v Welsh, 2003 CanLII 27587 (Ont SC), Levac v James, 2023 ONCA 73, Farej v Fellows, 2022 ONCA 254, R v GF, 2021 SCC 20, Ferguson v Hamilton Civic Hospitals (1983), 144 DLR (3d) 214 (Ont SC), Cuthbertson v Rasouli, 2013 SCC 53, Huisman v MacDonald, 2007 ONCA 391, White Burgess Langille Inman v Abbott and Haliburton Co, 2015 SCC 23, Wise v Abbott Laboratories, Ltd, 2016 ONSC 7275, R v Whatcott, 2023 ONCA 536

Johnson v. Lakeridge Health Corporation, 2024 ONCA 291]

Keywords: Torts, Professional Negligence, Medical Malpractice, Standard of Care, Civil Procedure, Evidence, Admissibility, Experts, Rules of Civil Procedure, r. 53.03(03), Clements v. Clements, 2012 SCC 32

Alami v. Haddad, 2024 ONCA 300

Keywords: Family Law, Property, Resulting Trusts, Matrimonial Home, Equalization of Net Family Property, Civil Procedure, Appeals, Security for Costs, Rules of Civil Procedure, r.61.06(1), York University v. Markicevic, 2017 ONCA 651, Lavallee v. Isak, 2022 ONCA 290, Heidari v. Naghshbandi, 2020 ONCA 757, Thrive Capital Management Ltd. v. Noble 1324 Queen Inc., 2021 ONCA 474, Yaiguaje v. Chevron Corporation, 2017 ONCA 827, Henderson v. Wright, 2016 ONCA 89

Short Civil Decisions

Sternberg v. Cresford Capital Corporation, 2024 ONCA 283

Keywords: Civil Procedure, Appeals, Leave to Appeal

Margel v. Dawson, 2024 ONCA 275

Keywords: Contracts, Real Property, Mortgages, Damages, Interest, Cheung v. Moskowitz Capital Mortgage, 2018 ONSC 1322, 2257573 Ontario Inc. v. Furney, 2022 ONCA 505

Vyazemskaya v. Safin, 2024 ONCA 288

Keywords: Costs

Public Guardian and Trustee v. Dhuruvasangary, 2024 ONCA 289

Keywords: Wills and Estates, Guardianships, Property, Powers of Attorney, Removal

Ontario (Attorney General) v. $38,570 in Canadian Currency (In Rem), 2024 ONCA 293

Keywords: Civil Procedure, Appeals, Extension of Time, Civil Remedies Act, 2001, S.O. 2001, c. 28, Enbridge Gas Distribution Inc. v. Froese, 2013 ONCA 131, Nguyen v. Economical Mutual Insurance Co., 2015 ONCA 828, Codina v. Canadian Broadcasting Corporation, 2020 ONCA 116, Philbert v. Graham, 2022 ONCA 122, Duca Community Credit Union Ltd. v. Giovannoli (2001), 142 O.A.C. 146 (C.A.)

Allen v. Kumar, 2024 ONCA 294

Keywords: Civil Procedure, Appeals, Security for Costs


CIVIL DECISIONS

Matos v. Driesman, 2024 ONCA 271

[Harvison Young, Coroza and Gomery JJ.A.]

Counsel:

M. Polisuk, for the moving party

N. R. Leite, for the responding party

Keywords: Family Law, Child Support, Arrears, Variation, Civil Procedure, Disclosure, Orders, Enforcement, Striking Pleadings, Uncontested Trials, Motions to Change, Matos v. Driesman, 2018 ONCA 660, Freedman v. Freedman, 2022 ONSC 4823, Colucci v. Colucci, 2021 SCC 24

facts:

The appellant father, DD, brought an appeal against an order made following an uncontested trial (the “Order”). The proceeding in which that Order was made was initiated in 2015 by the respondent mother, MM, who sought to change the final order for child support for the parties’ two children made in 2010 by Mesbur J. (the “Motion to Change”).

On September 24, 2015, the mother brought the Motion to Change to address the continuation of child support. The Motion to Change requested that the father pay a minimum of $1,000 per month for special and extraordinary expenses related to the children’s York School, extracurricular activities and summer camp.

On September 22, 2017, Paisley J. struck the father’s pleadings due to his failure to comply with earlier disclosure orders. His appeal of this order was dismissed: Matos. This resulted in an uncontested trial of the Motion to Change.

The motion judge imputed $240,000 in income to the father for the calendar year 2015, rising by 3% cost of living each year thereafter. He awarded the mother $505,783.85 in arrears for s. 7 expenses related to the York School, extracurricular activities, summer camp and university expenses for the children. The father appealed from this Order. The mother moved to quash his appeal.

issue:

Does the father have standing to appeal given that his pleadings had been struck?

holding:

Motion granted. Appeal quashed.

reasoning:

No.

The father had no standing to appeal. The Court in Lamothe, at para. 3, held that it “will not typically hear an appeal by a party from an unopposed proceeding” because “[p]articipation in an appeal after an uncontested trial has been ordered can circumvent that order, contrary to the interests of justice.” The Court in that case recognized, at para. 3, that there may be exceptions to this rule where the issues raised in the appeal have clear merit or show that an injustice has been done.

The father relied on Freedman, in which the Court found that a party in an uncontested trial can only seek relief claimed and served in the proceeding. In the view of the Court, this case was distinguishable on the basis that Freedman involved claims for entirely different heads of relief. In Freedman, the mother had initially sought spousal and child support, division of property and equalization. During oral argument at the uncontested trial, she sought an order adding various individuals and companies to the proceeding for enforcement purposes, as well as an order awarding the mother damages: para. 18. The trial judge had found that these claims had not been pleaded and therefore could not be granted: see paras. 18 and 82.

In contrast, in this case, the mother had not attempted to claim any new heads of relief and the motion judge did not grant her relief not requested in her pleadings. Her 2015 pleadings in the Motion to Change requested s. 7 expenses. While the types of s. 7 expenses changed as the children grew older, she had not attempted to argue for any new relief. The allegedly new heads of relief were not new. The Court noted that they simply reflected the evolving nature of the sorts of expenses associated with raising and educating children, which the court below accepted as reasonable and necessary in the circumstances of this family.

The Court agreed with the mother’s submission that to require parties to submit a new application or amend their pleadings any time a s. 7 expense changed would be an unreasonable burden. The Court also agreed that it was clear from the record that the father was aware that university expenses were at issue. In a motion to change brought by the father before Nishikawa J., he referenced the oldest child’s university tuition when arguing that he was unable to continue to pay child support and s. 7 expenses.

The father’s pleadings had been struck for his failure to comply with his disclosure obligations. As the Supreme Court of Canada has emphasized recently, disclosure is the linchpin on which fair child support depends: Colucci at para. 48.


Cardillo v. Medcap Real Estate Holdings Inc., 2024 ONCA 278

[Harvison Young, Coroza and Gomery JJ.A.]

Counsel:

F. Scott Turton, for the moving parties

B. Jaffe, for the responding party, B. Riley Farber Inc., Trustee in Bankruptcy of the Estate of Medcap Real Estate Holdings Inc.

M. Krygier-Baum, for the respondents Bennington Financial Corp., Heffner Investments Limited, Scott Wilson and Physiomed Health Holdings Inc.

Keywords: Bankruptcy and Insolvency, Transfers Under Value, Civil Procedure, Appeals, Leave to Appeal, Bankruptcy and Insolvency Act, RSC, 1985, c. B-3, ss 193(a)-(e), Courts of Justice Act, RSO, 1990, c. C.43, s. 7(5), Rules of Civil Procedure, r. 61.16(2.2), Courts of Justice Act, RSO 1990, c C 43, ss. 6, 7(3)(5),  Business Development Bank of Canada v. Pine Tree Resorts Inc., 2013 ONCA 282, 2403177 Ontario Inc. v. Bending Lake Iron Group Limited, 2016 ONCA 225, Robson (Re) (2002), 33 CBR (4th) 86 (Ont. C.A.), DeMarco v. Nicoletti, 2017 ONCA 417, Yaiguaje v. Chevron Corporation, 2017 ONCA 827, Struik v. Dixie Lee Food Systems Ltd., 2018 ONCA 22, Hillmount Capital Inc. v. Pizale, 2021 ONCA 364

facts:

J.C. is Medcap’s principal. Medcap’s largest known asset is a commercial building located in Hamilton (the “Property”). Five mortgages were registered against the Property and the Property had been leased to 1869541 Ontario Inc. (“186”). Within the bankruptcy proceedings, the Trustee brought a motion challenging the lease to 186 as a transfer at undervalue (the “TUV Motion”).

In addition to the bankruptcy proceedings, the Cardillo Parties brought an action in Hamilton (the “Foreclosure Action”) relating to a mortgage allegedly assigned to 2503866 Ontario Inc. (“250”). The Trustee and the respondents (all of whom are respondents to the Foreclosure Action) challenged 250’s rights under this mortgage, described by Kimmel J. as the “250 Mortgage Dispute”.

On motion by the Trustee, Kimmel J. consolidated the Foreclosure Action, the 250 Mortgage Dispute and the TUV Motion and ordered the trial of an issue in the 250 Mortgage Dispute in the bankruptcy proceeding in Toronto. She ordered that the 250 Mortgage Dispute be stayed. She rejected the cross-motion by the Cardillo Parties that the bankruptcy proceeding and the TUV Motion be transferred to Hamilton.

The Cardillo Parties filed a Notice of Appeal and the Trustee brought a motion to dismiss the appeal on the basis that the Cardillo Parties did not have an automatic right of appeal under ss. 193(a) or (c) of the BIA. The chambers judge allowed the Trustee’s motion, finding that there was no automatic right of appeal and denied leave to appeal. The Cardillo Parties brought a motion to a panel of the Court to review the chambers judge’s order.

issues:
  1. Was the chambers judge correct in ruling that a single judge can make an order that an appeal is not of right but rather requires leave and then go on to deny leave?
  2. Was it procedurally unfair that the chambers judge denied leave to appeal without affording the Cardillo Parties an opportunity to have a leave motion?
holding:

Motion dismissed.

reasoning:
  1. Yes

The Cardillo Parties argued that there was no conflict between s. 193(e) of the BIA and r. 61.16(2.2) because while s. 193(e) deals with motions for leave to appeal, r. 61.16(2.2) does not. Section 193(e) grants a single judge the authority to grant or deny leave to appeal, while r. 61.16(2.2) requires that a motion in this court for an order that finally determines an appeal, other than an order dismissing the appeal on consent, must be heard by a three-judge panel. In the view of the Cardillo Parties, a single judge was permitted to determine whether leave to appeal should be granted where a motion was brought under s. 193(e) of the BIA because, at that stage, no appeal exists until leave is granted.

The Cardillo Parties argued that where a party appeals as of right, an appeal has come into existence. Any motion to dismiss it would finally determine the appeal, therefore requiring a panel pursuant to r. 61.16(2.2).

A panel may interfere with the order if the chambers judge failed to identify the applicable principles, erred in principle or reached an unreasonable result. None of these grounds existed here.

The chambers judge addressed every ground raised by the Cardillo Parties. He considered whether his decision would “finally determine” the appeal and found that it did not. He found that an order denying leave to appeal under s. 193(e) of the BIA would not fall within the language of r. 61.16(2.2). Even if it did, r. 61.16(2.2) could not be given effect due to the constitutional doctrine of paramountcy. There was no error in principle with these findings.

The fact that the issue of leave was raised via a challenge to the asserted right of appeal did not affect a single judge’s authority to make a determination of whether leave should be granted. That decision was made pursuant to s. 193(e) of the BIA and therefore any conflict with r. 61.16.(2.2) was resolved in favour of the federal BIA. Paramountcy operates to give a single judge the power to make a determination of whether to grant or deny leave where the BIA is involved.

  1. No

The Cardillo Parties argued that Kimmel J.’s decision was not simply procedural because the stay order affected the Cardillo Parties’ ability to enforce their mortgages. They submitted that it was procedurally unfair to deny leave to appeal when they had not had a chance to bring a motion for leave.

The Court did not agree that the chambers judge made any error in finding that Kimmel J.’s decision was purely procedural. There was a complex network of mortgage and bankruptcy proceedings and the only issue before her, as she put it, was “how, where and when” the 250 Mortgage Dispute underlying both the Foreclosure Action and the TUV Motion should be adjudicated. The Court agreed with the chambers judge’s assessment that the resolution of this issue “did not determine any substantive rights of the parties” and was “a run-of-the-mill procedural order designed to move a specific dispute along to a final adjudication on the merits in the most expeditious and least expensive manner.”

The Court did not agree with the Cardillo Parties argument that there was any procedural unfairness by the chambers judge determining the issue of leave before the Cardillo Parties had brought a motion for leave. This argument was raised before the chambers judge. The Cardillo Parties were therefore aware that a determination of whether leave should be granted might be made by the chambers judge and had an opportunity to make submissions on the merits of this issue at that stage.


Denman v. Radovanovic, 2024 ONCA 276

[Rouleau, Benotto and Copeland JJ.A.]

Counsel:

J.T. Curry, J. Lilles and K.R. Costin, for the appellants

S. Mandel and A. Mladenovic, for the respondents

Keywords: Torts, Negligence, Medical Malpractice, Duty of Care, Duty of Disclosure, Informed Consent, Causation, Civil Procedure, Evidence, Admissibility, Hearsay, Opinion, Experts, Bias, Costs, Health Care Consent Act, 1996, SO 1996, c. 2, Sched A, s.10(1), s. 29(1), Rules of Civil Procedure, r. 57.01, Reibl v Hughes, [1980] 2 SCR 880, Hollis v Dow Corning Corp, [1995] 4 SCR 634, Van Dyke v Grey Bruce Regional Health Centre (2005), 255 DLR (4th) 397 (Ont CA), Watson v Dr Shawn Soon, 2018 ONSC 3809, Bollman v Soenen, 2014 ONCA 36, Felde v Vein and Laser Medical Centre (2003), 68 OR (3d) 97 (CA), Ross v Welsh, 2003 CanLII 27587 (Ont SC), Levac v James, 2023 ONCA 73, Farej v Fellows, 2022 ONCA 254, R v GF, 2021 SCC 20, Ferguson v Hamilton Civic Hospitals (1983), 144 DLR (3d) 214 (Ont SC), Cuthbertson v Rasouli, 2013 SCC 53, Huisman v MacDonald, 2007 ONCA 391, White Burgess Langille Inman v Abbott and Haliburton Co, 2015 SCC 23, Wise v Abbott Laboratories, Ltd, 2016 ONSC 7275, R v Whatcott, 2023 ONCA 536

facts:

The central issues underlying this appeal were the nature and extent of a physician’s duty to obtain informed consent for a multi-step course of elective medical treatment, and on which physicians involved in treatment this duty rested.

In 2015, the respondent MD suffered a catastrophic brain bleed because of a medical procedure aimed at curing an anterior ventricle malformation (“AVM”) in his brain. There was no suggestion that the procedure, which was part of a multi-step treatment plan, was performed in a negligent manner. Rather, the respondents brought a claim alleging that the appellants, three doctors at the Toronto Western Hospital (“TWH”), had failed to obtain MD’s informed consent. The respondents sued in negligence, alleging that if the appellants had not breached their duty of disclosure, neither MD nor a reasonable person in his circumstances would have proceeded with the recommended elective treatment plan.

The issue at trial was whether the appellants were liable based on a failure to obtain informed consent.  The trial judge held that all three appellants were liable.  The physicians appealed.

issues:
  1. Did the trial judge err in applying the law of informed consent?
  2. Did the trial judge err in disqualifying one of the appellants’ proposed experts?
  3. Did the trial judge err in awarding $3 million in costs?
holding:

Appeal dismissed.

reasoning:
  1. No

The trial judge was required to determine what MD and a reasonable patient in his circumstances would have done had adequate disclosure been made.

MD’s circumstances were considered

The appellants argued that the trial judge failed to consider MD’s personal circumstances when applying the test for informed consent. They argued that the trial judge’s finding that MD would delay treatment until retirement, was unsupported by the evidence in light of this fact. The Court disagreed. The reasons for decision set out the relevant law and, read as a whole, adequately demonstrated that the trial judge was well aware of MD’s personal circumstances in applying the law.

Although MD’s disability precluded him from testifying, the evidence at trial from those who knew him personally disclosed not only that MD intended to resolve his AVM so as to remove the risk of spontaneous bleed, but also that, at the time the plan of treatment was proposed, MD: (a) was doing well and his AVM was asymptomatic; (b) had resumed traveling for pleasure; (c) had resumed his employment and his employer was prepared to accommodate his needs; (d) was the primary breadwinner; (e) was 11 years away from retirement age; (f) was still trying to get a financial plan together for his daughter with a disability; (g) was not a risk taker. The trial judge considered that MD or a reasonable person in his circumstances would have assessed the relative risks and decided whether to treat his AVM or not and, should he wish to treat it, whether to treat it then or defer it to a later time.

Risks that ought to have been disclosed

The appellants submitted that the trial judge erred in imposing a duty to provide exact statistical probabilities. They also took issue with the trial judge’s failure to make a specific finding on what risks ought to have been disclosed to MD, which was a key issue at trial. This, they said, was necessary to understand the basis for the trial judge’s conclusion that, had the risks of the plan of treatment or the third combined treatment been adequately disclosed, neither MD nor a reasonable person in his circumstances would have proceeded with treatment.

The Court did not accept the appellants’ submissions on these points. The trial judge imposed no requirement to provide a specific calculation of the level of risk or specific statistics in explaining the risk. Had MD been given the appropriate information, he would have weighed an immediate 30 to 50 percent upfront risk of permanent neurological deficit against a 40 to 60 percent risk of spontaneous bleed spread over a lifetime. It was clear that neither MD, nor a reasonable person in his situation, would have undertaken the suggested course of treatment.

The appellants argued that because the two first embolizations were carried out without incident, that they were legally irrelevant. They challenged the sufficiency of reasons, arguing that the trial judge did not make any clear findings as to what risks were disclosed to MD prior to the combined third procedure. The Court noted that even if the trial judge had rejected the evidence of MD’s wife and accepted a doctor’s evidence that the respondents were told the risk of significant morbidity or mortality was 3 to 5 percent, that risk assessment was grossly deficient based on the appellants’ own expert.

No error in finding all three appellants liable

The appellants conceded that if the Court confirmed the trial judge’s finding that there was a breach of the duty of informed consent and that causation was established, then Dr.P, as the physician who carried out the embolization procedure that caused the injury, was properly found liable. However, they disputed liability on the part of Dr. tB and Dr. R as they did not bear the responsibility to obtain informed consent for the procedure that resulted in the injury. The Court did not agree that, in the circumstances of this case, the trial judge erred in concluding that Dr. tB and Dr. R shared liability with Dr. P.

The appellants maintained that it was well established that only the physician carrying out the procedure is responsible for obtaining informed consent. The Court disagreed. This notion stems from the pre-Reibl era, when lack of consent was historically associated with the intentional tort of battery. Modern medical treatment may involve a team of doctors working together. Therefore, a physician not performing a procedure may, depending on the circumstances, have a duty of disclosure. Whether there is liability will depend on causation.

The Court held that the trial judge did not err in finding liability on the part of Dr. tB, who provided inadequate disclosure to MD, which ultimately led to MD proceeding with the plan of treatment for his AVM. The Court noted that it is difficult to see how one could say that, in these circumstances, Dr. tB had no responsibility to provide MD with adequate disclosure to enable him to make an informed decision.

The appellants argued that it was unreasonable and an error of law for the trial judge to impose a duty to disclose the risks of multiple procedures in advance of any treatment and to impose liability on that basis. The Court disagreed. The trial judge explained at length why she rejected Dr. tB’s testimony that a single embolization would likely be curative of MD’s condition.

The trial judge found that Dr. tB’s failure to disclose to MD the nature of the multi-step course of elective medical intervention required was simply “not defensible”. Any reasonable patient in MD’s circumstances would want to know what interventions would likely be required to effect a cure and the risks or range of risks associated with the expected course of treatment. Dr. tB failed to provide MD with an estimate of the lifetime risk or range of risk he would be subject to without treatment of his AVM. This information was necessary to enable MD to weigh the relative or comparative risks and benefits between undergoing the plan of treatment and deferring treatment.

The trial judge’s conclusion that Dr. tB did not adequately disclose the risks involved with the plan of treatment being proposed, or even with a single embolization treatment, was well supported in the record and outlined in the reasons. The Court held that Dr. tB’s disclosure to MD was inadequate.

The Court held that there was sufficient causation between Dr. tB’s inadequate disclosure and the injury suffered by MD. The Court accepted that MD was, at each step, offered the choice to proceed or not to proceed with the immediate procedure being undertaken. The Court also accepted that, at each of the three steps, he gave his consent to that procedure. This may well give rise to a defence to a claim in battery, but it was not sufficient to provide a defence to a claim in negligence. As found by the trial judge, had MD been given adequate disclosure by Dr. tB, neither he nor a reasonable person in his situation would have embarked upon the course of treatment.

Unfortunately, MD did not receive adequate disclosure along the way, including before the third combined procedure. Accordingly, the chain of causation was not broken. In conclusion, the Court saw no error in the trial judge’s conclusion that Dr. tB shared liability for the inadequate disclosure to MD.

The appellants also challenged the imposition of liability on Dr. R on the basis that he was not the physician who provided the treatment that caused injury to MD. The Court, as explained above, rejected the proposition that only the physician who provided the treatment that resulted in the injury can be liable in negligence for failing to obtain informed consent.

The trial judge’s finding that, properly informed of the risks, neither MD nor a reasonable person in his circumstances would have agreed to undergo the combined embolization and surgical resection was fully supported by the record. Therefore, but for the combined negligence of Dr. R and Dr. P, MD would not have agreed to the combined procedure and the injury to MD would not have occurred. In the circumstances, there was no basis for interfering with the trial judge’s finding that Dr. R was equally liable.

  1. No

No error in refusing to recognize Dr. Re as an expert witness

At trial, the appellants sought to call Dr. Re, a vascular neurosurgeon and interventional neurologist, as an expert witness. The respondents challenged Dr. Re’s impartiality. Following the voir dire, the trial judge excluded Dr. Re from testifying as a result of bias.

On appeal, the appellants argued that the trial judge made a legal error in failing to apply White Burgess Langille Inman v. Abbott and Haliburton Co., choosing, instead, to ground her reasons in Wise. v. Abbott Laboratories, Ltd. and to apply the factors listed in Wise as a “strict test”.

The Court held that the threshold for interfering with the trial judge’s decision was not met. Nor was the Court satisfied that the trial judge’s reasons were insufficient or that she made any palpable and overriding errors. She applied the correct legal test. She referred to White Burgess. She understood that an expert will be prevented from testifying only if the expert is unable or unwilling to discharge the duty to provide a fair and non-partisan opinion. She considered the Wise decision as setting out a non-exhaustive list of factors that “may be considered when ascertaining bias or impartiality” of an expert witness.

The trial judge did not limit her analysis to the application of the Wise factors. She took into account factors listed in Wise relevant to an assessment of the legal test from White Burgess. The Court also rejected the appellants’ submission that the trial judge’s findings in support of her conclusion were unsupported by the evidence. Deference was owed to the trial judge’s factual findings.

No error in the treatment of the testimony of MD’s wife

The appellants raised objections to parts of the testimony of MD’s wife on the basis that it was hearsay or inadmissible lay opinion evidence.   The Court disagreed that the trial judge failed to grapple with the hearsay issue. The trial judge reviewed the law relating to hearsay. She was clearly alert to the concern in this case that MD’s wife, who she found to be a credible witness, could only testify to her knowledge and, although she could testify as to what she was told by MD, this would not constitute proof that those statements were true. The trial judge, who had instructed MD’s wife not to give evidence as to her belief, was alive to the problems with such evidence.

No error in treatment of Dr. F’s evidence

The appellants submitted that the trial judge failed to rule on defence objections to testimony from the respondents’ expert, Dr. F. The transcript revealed that the trial judge was asked to make and did in fact make an in-trial ruling. She ruled that Dr. F was to be qualified to provide expert evidence in neurology and deal with informed consent issues about the management and care of AVMs.

  1. No

The Court did not grant leave to appeal the costs award. The trial judge’s award of costs was entitled to a high degree of deference. The trial judge’s reasons showed that she thoroughly reviewed the factors to be considered in awarding costs, as outlined in r. 57.01 of the Rules, and made an appropriate award.


Johnson v. Lakeridge Health Corporation, 2024 ONCA 291

[Rouleau, Lauwers and Monahan JJ.A.]

Counsel:

P. Harte and J. Marin, for the appellants

D. Cruz and S. Willsey, for the respondents

Keywords: Torts, Professional Negligence, Medical Malpractice, Standard of Care, Civil Procedure, Evidence, Admissibility, Experts, Rules of Civil Procedure, r. 53.03(03), Clements v. Clements, 2012 SCC

facts:

In October 2012, W.J., who was then 43 years old, suffered two strokes. The initial stroke occurred sometime before October 18, 2012 (the “First Stroke”), and was less severe than the second stroke on October 30, 2012 (the “Second Stroke”), which was major and life-altering.

W.J. was admitted to hospital on October 18, 2012, following the First Stroke. During his time at the hospital, he underwent several tests that identified the underlying cause of the First Stroke as being a dissection or tear within the wall of the vertebral artery in his neck. This caused a blood clot to form, which subsequently dislodged and blocked blood flow to his brain.

W.J. was discharged by the respondent, Dr. R.V., on October 23, 2012. It was agreed that the respondent discharged W.J. without reviewing the MR angiogram of his head and neck vessels taken on October 22, 2012 (the “MRA”), and that her failure to do so was a breach of the applicable standard of care.

Damages were agreed upon, the only issue at trial was causation, specifically, whether the negligent discharge of W.J. by the respondent on October 23, 2012, caused the Second Stroke. The parties filed a detailed agreed statement of fact (“ASF”) and there were only two witnesses at trial, W.J.’s expert, Dr. L.C., and the respondent’s expert, Dr. D.G.

The trial judge rejected the evidence of Dr. L.C. and accepted that of Dr. D.G. Finding that the appellants had not proven, on a balance of probabilities, that the Second Stroke would likely have been avoided had W.J. been prescribed Heparin instead of Aspirin at the time of his initial discharge from the hospital. He held that it had not been proven that the respondent’s admitted negligence caused W.J.’s Second Stroke. Accordingly, the plaintiffs failed to prove causation and the action was dismissed.

issues:
  1. Did the trial judge permit “trial by ambush” by admitting Dr. D.G.’s opinion on the likely cause of the Second Stroke when that opinion was not disclosed in his expert reports, contrary to r. 53.03(03)?
  2. Did the appellants establish a prima faciecase on causation?
holding:

Appeal dismissed.

reasoning:
  1. No

There was no trial by ambush.

The appellants took exception to the fact that Dr. D.G. was permitted to testify during his evidence-in-chief that an occlusion of W.J.’s artery was the “likely cause” of the Second Stroke. The statement in the ASF, which came from Dr. D.G.’s opinion, was accepted by the appellant as to the likely cause of the Second Stroke. While Dr. D.G.’s expert reports had identified either blood clots and/or reduced blood flow in the artery as likely causes of the Second Stroke, his reports had not identified one mechanism as being more likely than the other. Thus, the appellants argued, admitting the evidence was contrary to r. 53.03(03) of the Rules of Civil Procedure and amounted to “trial by ambush”.

Even assuming, without deciding, that the trial judge ought not to have permitted Dr. D.G.’s evidence-in-chief to express the opinion that the Second Stroke was caused by the occlusion in W.J.’s left vertebral artery, Dr. D. G. later backed off from that opinion on cross-examination and ultimately reverted to his original stance, testifying that the Second Stroke was likely caused by blood clots and/or by reduced blood flow in his artery. The appellants could hardly have been surprised by this evidence, since they themselves agreed in the ASF that a reduction of blood flow in W.J.’s vertebral artery may have caused the Second Stroke.

The evidence to which the objection was made did not affect the outcome of the case. Based on the trial judge’s review of the evidence as a whole, he was not satisfied that the Second Stroke would likely have been prevented had W.J. been placed on Heparin instead of Aspirin at the time of his initial discharge from hospital. The trial judge accepted Dr. D.G.’s evidence that based on the occlusion he observed in W.J.’s left vertebral artery, he was at high risk for a secondary stroke no matter what treatment he received, since “even if the mechanism of the stroke was embolic, Heparin would have been too little too late, as it would not have been able to open the blockage.”

The appellants had the burden of proving on a balance of probabilities that Heparin would have been more effective than Aspirin in preventing the Second Stroke. The trial judge rejected Dr. L.C.’s evidence and accepted that of Dr. D.G. on that issue, as he was entitled to do. It followed that the appellants did not meet their burden of showing that the respondent’s admitted negligence caused the Second Stroke.

  1. No

The appellants did not establish a prima facie case on the issue of causation.

The core issue in the case was not the absolute effectiveness of either Heparin or Aspirin but, rather, whether there was a difference in their relative effectiveness in preventing W.J.’s Second Stroke. While stroke victims who are treated with Heparin generally have only a 2 percent risk of developing a secondary stroke, the same is true of those treated with Aspirin. Accordingly, the mere fact that patients treated with Heparin had a low risk for developing a secondary stroke did not amount to a prima facie case that W.J.’s Second Stroke would have been prevented had he received Heparin rather than Aspirin commencing on October 23, 2012.


Alami v. Haddad, 2024 ONCA 300

[Roberts J.A. (Motion Judge)]

Counsel:

C. Baker, for the moving party/respondent

A.M., acting in person

Keywords: Family Law, Property, Resulting Trusts, Matrimonial Home, Equalization of Net Family Property, Civil Procedure, Appeals, Security for Costs, Rules of Civil Procedure, r.61.06(1), York University v. Markicevic, 2017 ONCA 651, Lavallee v. Isak, 2022 ONCA 290, Heidari v. Naghshbandi, 2020 ONCA 757, Thrive Capital Management Ltd. v. Noble 1324 Queen Inc., 2021 ONCA 474, Yaiguaje v. Chevron Corporation, 2017 ONCA 827, Henderson v. Wright, 2016 ONCA 89

facts:

The respondent sought security for his costs of the appeal brought by the appellant from the order of Bruhn J. dated January 10, 2024. Bruhn J. ordered the equalization of the parties’ net family property and determined that the respondent had a 50 percent ownership interest in the matrimonial home by way of a resulting trust. She ordered the sale of the matrimonial home with the caveat that it was not to interfere with the mortgagee’s sale of the matrimonial home under its notice of sale. She further ordered that the amount of $33,190.07 in unpaid costs orders owed by the appellant to the respondent (the “outstanding costs orders”) and the amount of $23,832.75 in outstanding child support arrears owed by the respondent to the appellant (the “outstanding child support arrears”) be paid from their respective shares of the sale proceeds from the matrimonial home.

issue:

Should the respondent be granted security for costs of the appeal brought by the appellant?

holding:

Motion dismissed.

reasoning:

No.

The criteria under r. 61.06(1)(a) are conjunctive: York University v para. 33. The respondent must therefore satisfy all of the criteria: there is good reason to believe that the appellant’s appeal is frivolous and vexatious and that she has insufficient assets in Ontario to pay the costs of the appeal. Generally, a frivolous appeal is one devoid of merit and with little prospect of success; a vexatious appeal is one that is brought to annoy or harass, is conducted in a vexatious or “less than diligent” manner, or is pursued in bad faith or for an oblique purpose: Lavallee at paras. 19, 25.

The appellant essentially challenged the application judge’s findings of fact about the respondent’s contributions without having identified errors in principle or palpable and overriding errors that would have permitted appellate interference. Given the deference generally owed to the application judge’s findings of fact, the appellant faced a stiff uphill battle on her appeal. The likelihood of the appellant’s appeal being successful was low. However, as her grounds are nevertheless arguable, the Court could not have said the appeal was so devoid of merit that it was frivolous. Even if it was frivolous, the Court was not persuaded that there was good reason to believe that the appeal was vexatious: the appellant was exercising her right to appeal and had to-date conducted her appeal in accordance with the Rules; there was no evidence that she was bringing the appeal to annoy or harass the respondent, although he may feel annoyed or harassed by the fact of it; and there was no evidence that she was pursuing her appeal for a bad faith or oblique purpose.

The Court was also not convinced that there was good reason to believe that the appellant had insufficient assets in Ontario to pay the appeal costs. In accordance with Bruhn J.’s order, the appellant had at present a 50 percent interest in the matrimonial home. While the incurring of ongoing costs may have eroded it, there was no evidence that the equity of the home will not be sufficient to satisfy any appeal costs from the appellant’s share once the home was sold. In the present case, the appellant’s appeal was weak. It effectively invited the Court to redo the application judge’s factual findings at the trial, which is not the Court’s function.

It is well-established that an order for security for costs is discretionary. In addition to the criteria under r. 61.06(1), the Court must also consider whether it is just to order security for costs in the circumstances of this case and the interests of justice: Thrive Capital Management Ltd. at para. 17. The Court referenced Yaiguaje at para. 23, stating that “[c]ourts must be vigilant to ensure an order that is designed to be protective in nature is not used as a litigation tactic to prevent a case from being heard on its merits”.

In weighing all the factors, the strongest point in favour of the respondent’s request for security for costs was that the appellant’s appeal appeared weak. However, the Court was not persuaded that it was frivolous or vexatious. Further, the appellant’s share of the matrimonial home sale proceeds provided protection for the appeal costs, as well as the prior outstanding costs orders. The Court also considered that the respondent was indebted to the appellant for the outstanding child support arrears. Aside from effectively reducing the appellant’s indebtedness to the respondent for the outstanding costs orders to less than $10,000, the Court found it inconsistent for the respondent to rely on the appellant’s failure to pay the outstanding costs orders as a reason to order security for costs when he was in arrears of child support.


SHORT CIVIL DECISIONS

Sternberg v. Cresford Capital Corporation, 2024 ONCA 283

[Benotto J.A. (Motions Judge)]

Counsel:

S. Block and J. Silver, for the plaintiff/defendant to the counterclaim

G. J. Tighe and A. Farley, for the defendant/plaintiff by counterclaim

Keywords: Civil Procedure, Appeals, Leave to Appeal

Margel v. Dawson, 2024 ONCA 275

[van Rensburg, Zarnett and George JJ.A.]

Counsel:

R. Byrnes, as agent for the appellant

D. Bourassa and A. (Q.) Tayyab, for the respondents

Keywords: Contracts, Real Property, Mortgages, Damages, Interest, Cheung v. Moskowitz Capital Mortgage, 2018 ONSC 1322, 2257573 Ontario Inc. v. Furney, 2022 ONCA 505

Vyazemskaya v. Safin, 2024 ONCA 288

[Doherty, Lauwers and George JJ.A.]

Counsel:

D. S., acting in person

S. Cocieru, for the respondent

Keywords: Costs

Public Guardian and Trustee v. Dhuruvasangary, 2024 ONCA 289

[van Rensburg, Zarnett and George JJ.A.]

Counsel:

R. Hettiarachchi, for the appellant

S. Jones, for the respondent

Keywords: Wills and Estates, Guardianships, Property, Powers of Attorney, Removal

Ontario (Attorney General) v. $38,570 in Canadian Currency (In Rem), 2024 ONCA 293

[Roberts J.A. (Motion Judge)]

Counsel:

J. M., acting in person/moving party

J. Coristine, for the responding party

Keywords: Civil Procedure, Appeals, Extension of Time, Civil Remedies Act, 2001, S.O. 2001, c. 28, Enbridge Gas Distribution Inc. v. Froese, 2013 ONCA 131, Nguyen v. Economical Mutual Insurance Co., 2015 ONCA 828, Codina v. Canadian Broadcasting Corporation, 2020 ONCA 116, Philbert v. Graham, 2022 ONCA 122, Duca Community Credit Union Ltd. v. Giovannoli (2001), 142 O.A.C. 146 (C.A.)

Allen v. Kumar, 2024 ONCA 293

[Roberts J.A. (Motion Judge)]

Counsel:

B.A.K., acting in person

A. Ferguson, for the responding parties

Keywords: Civil Procedure, Appeals, Security for Costs


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.

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

Good afternoon.
Following are our summaries of the civil decisions of the Court of Appeal for Ontario for the week of April 8, 2024.

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In 660 Sunningdale GP Inc. v. First Source Mortgage Corporation, the Court overturned a motion judge’s decision that excused 660 Sunningdale from paying the balance of a Lender Fee after it decided not to proceed with the loan transaction under the Commitment Letter it had entered into with the lender, First Source. The motion judge ruled that the balance of the Lender Fee was an unenforceable penalty and also granted relief against forfeiture. The Court found that the Lender Fee was not a penalty, since it was earned as soon as the Commitment Letter was signed, and did not only become payable upon breach of the Commitment Letter by the borrower. In addition, the obligation to pay the Lender Fee was not a forfeiture of a contractual right from which relief could be granted. In wrongly applying these doctrines, the motion judge essentially applied the doctrine of unconscionability, which was unavailable in this case, as there was no inequality of bargaining power. 660 Sunningale was a large land developer, and could not be said not to be on a level playing field with the lender. This is a great decision for lenders, as it supports the enforceability of large lender fees payable when a sophisticated borrower backs out of a loan transaction.

In National Steel Car Limited v. Independent Electricity System Operator, the appellant contended that the Ontario government’s feed-in-tariff renewable electricity procurement program (FIT Program) was mainly designed to provide economic stimulus rather than serving a regulatory purpose. National Steel Car argued this program, which increased its electricity costs, amounted to unconstitutional taxation, in violation of the Constitution Act, 1867. The application judge determined that the FIT Program’s costs were valid regulatory charges, not covert taxes, aligning with Ontario’s legitimate goals of enhancing renewable energy and supporting economic, social, and environmental objectives. The Court found no error in the application judge’s conclusions.

Other topics covered this week included fraudulent conveyances, the abandonment of an appeal, the doctrines of res judicata and issues estoppel in the insurance coverage context, a failed closing of an agreement of purchase and sale of land where both buyer and seller mistakenly believed that the subject property was subject to a prescriptive easement, jurisdiction in an appeal from summary judgment on unpaid invoices in an action commenced under the Construction Act, the refusal of a court to hear a motion served the afternoon before a receivership hearing to approve a sales process, and the dismissal of a claim against a family lawyer for professional negligence and defamation.

Wishing everyone an enjoyable weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Table of Contents

Civil Decisions

6071376 Canada Inc. v. Khedmatgozar, 2024 ONCA 248

Keywords: Torts, Fraud, Conspiracy, Fraudulent Conveyances, Badges of Fraud, Civil Procedure, Applications, Rules of Civil Procedure, r. 38.10(1), Agribrands Purina Canada Inc v Kasamekas, 2011 ONCA 460, FL Receivables Trust 2002-A v Cobrand Foods Ltd, 2007 ONCA 425, Koop v Smith (1915), 51 SCR 554, Montor Business Corporation v Goldfinger, 2016 ONCA 406, Re Fancy (1984), 46 OR (2d) 153 (H. Ct. J.)

Peakhill Capital Inc. v. 1000093910 Ontario Inc., 2024 ONCA 261

Keywords: Bankruptcy and Insolvency, Receiverships, Sales Process, Contracts, Real Property, Agreements of Purchase and Sale of Land, Civil Procedure, Motions, Notice, Royal Bank of Canada v. Keller & Sons Farming Ltd., 2016 MCBA 46, Re Harmon International Industries Inc., 2020 SKCA 95, Marchant Realty Partners Inc. v. 2407553 Ontario Inc., 2021 ONCA 375, Ravelston Corporation Limited (Re), 2007 ONCA 135, Royal Bank of Canada v. Soundair Corp., 1991 CanLII 2727 (ONCA), CCM Master Qualified Fund v. blutip Power Technologies, 2012 ONSC 1750, Canrock Ventures LLC v. Ambercore Software Inc., 2011 ONCA 414

Aviva Insurance Company of Canada v. 8262900 Canada Inc. (CarePartners/Community Nursing Services Foundation), 2024 ONCA 258

Keywords: Contracts, Insurance, Coverage, Civil Procedure, Appeals, Abandonment, Reinstatement, Res Judicata, Issue Estoppel, Hermanns v Ingle (2002), 158 OAC 21 (Ont. C.A.), Re Rogers, [1955] O.J. No. 372, 1955 CanLII 399 (ON SC), Sherwood v Cinnabar Brown Holdings Ltd, 2021 BCCA 88, Philipos v Canada (Attorney General), 2016 FCA 79, Adam and Adam v Insurance Corporation of British Columbia et al (1985), 1985 CanLII 584 (BC CA), Akagi v Synergy Group (2000) Inc, 2014 ONCA 731

Arcamm Electrical Services Ltd. v. Avison Young Real Estate Management Services LP, 2024 ONCA 251

Keywords: Contracts, Real Property, Construction, Civil Procedure, Summary Judgment, Appeals, Jurisdiction, Construction Act, R.S.O. 1990, c. C.30, s 50(2), Courts of Justice Act, R.S.O. 1990, c. C. 43, s 6(1)(b), Rules of Civil Procedure, r. 20, Villa Verde L.M. Masonry Ltd. v. Pier One Masonry Inc. (2001), 54 O.R. (3d) 76 (C.A.), Great Northern Insulations Services Ltd. v. King Road Paving and Landscaping Inc., 2021 ONCA 367, Soo Mill and Lumber Company Ltd. v. Possebon et al., 2023 ONCA 215

660 Sunningdale GP Inc. v. First Source Mortgage Corporation, 2024 ONCA 252

Keywords: Contracts, Interpretation, Penalty Clauses, Debtor-Creditor, Loan Agreements, Commitment Letters, Lender Fees, Defences, Unconscionability, Remedies, Rescission, Relief from Forfeiture, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 98, Peachtree II Associates – Dallas L.P. v. 857486 Ontario Ltd. (2005), 76 O.R. (3d) 362 (C.A.), Dunlop Pneumatic Tyre Co. Ltd. v. New Garage & Motor Co. Ltd., [1915] A.C. 79 (H.L.), Marshallzehr Group Inc. v. Ideal (BC) Developments Inc., 2021 ONCA 229, Canadian General Electric Co. v. Canadian Rubber Co. (1915), 52 S.C.R. 349, Polaroid Canada Inc. v. Continent-Wide Enterprises Limited (2000), 7 B.L.R. (3d) 37 (Ont. C.A.), Uber Technologies Inc. v. Heller, 2020 SCC 16, Shiloh Spinners Ltd. v. Harding, [1973] AC 691, Redstone Enterprises Ltd. v. Simple Technology Inc., 2017 ONCA 282, Rahbar v. Parvizi, 2023 ONCA 522, Kozel v. The Personal Insurance Company, 2014 ONCA 130, 216927 Alberta Ltd. v. Fox Creek (Town), 1990 ABCA 29, Conner v. Bulla, 2010 BCCA 457, Liscumb v. Provenzano et al. (1985), 51 O.R. (2d) 129 (H.C.J.), Ross v. T. Eaton Co. (1992), 11 O.R. (3d) 115 (C.A.), 120 Adelaide Leaseholds Inc. v. Oxford Properties Canada Ltd., [1993] O.J. No. 2801 (C.A.), 383421 Ontario Inc. v. Ole Miss Place Inc. (2003), 67 O.R. (3d) 161 (C.A.), PDM Entertainment Inc. v. Three Pines Creations Inc., 2015 ONCA 488, Highway Properties Ltd. v. Kelly, Douglas and Co. Ltd., [1971] S.C.R. 562, Norberg v. Wynrib, [1992] 2 S.C.R. 226

Bell v. Amini, 2024 ONCA 260

Keywords: Torts, Professional Negligence, Lawyers, Defamation, Civil Procedure, Summary Judgment, Rules of Civil Procedure, r. 20.04(2), Bell v. Fishka, 2022 ONCA 683, Grant v. Torstar, 2009 SCC 61, Haskett v. Equifax Canada Inc. (2003), 63 O.R. (3d) 577 (C.A.), Hyrniak v. Mauldin, 2014 SCC 7

Roalno Inc. v. Schaefer, 2024 ONCA 262

Keywords: Contracts, Real Property, Easements, Anticipatory Breach, Remedies, Declarations, Specific Performance, Abatements, Road Access Act, R.S.O. 1990, c. R.34, Land Titles Act, R.S.O. 1990, c. L.5, s. 51, 1043 Bloor Inc v 1714104 Ontario Inc, 2013 ONCA 91, 3999581 Canada Inc v 1394734 Ontario Inc, 2007 ONCA 312, Whitmell v Ritchie (1994), 20 O.R. (3d) 424 (C.A.), Margettie v Snell, 2009 ONCA 838, Spirent Communications of Ottawa Limited v Quake Technologies (Canada) Inc, 2008 ONCA 92

National Steel Car Limited v. Independent Electricity System Operator,2024 ONCA 265

Keywords: Energy, Electricity, Price Regulation, Constitutional Law, Taxation, Division of Powers, Pith and Substance, Intra Vires, Civil Procedure, Applications, Evidence, Admissibility, Information and Belief, Expert Evidence, Impartiality, Constitution Act, 1867, Green Energy and Green Economy Act, 2009, S.O. 2009, c. 12, Electricity Act, 1998, S.O. 1998, c.15, Sched. A, Ontario Energy Board Act, 1998, S.O. 1998, c.15, Sched. B, Energy Statute Law Amendment Act, 2016, S.O. 2016, c. 10, Taxpayer Protection Act, 1999, S.O. 1999, c. 7, Sched. A, Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c. F.31, Rules of Civil Procedure, rr. 4.1.01, 39.01(5), National Steel Car Limited v. Independent Electricity System Operator, 2019 ONCA 929, Re: Exported Natuaral Gas Tax, [1982] 1 S.C.R. 1004, Allard Contractors Ltd. v. Coquitlam (District), [1993] 4 S.C.R. 371, Reference re Firearms Act, 1998 ABCA 305, R. v. Palmer, 2021 ONCA 348, Bruno v. Dacosta, 2020 ONCA 602, Farej v. Fellows, 2022 ONCA 254, Housen v. Nikolaisen, 2002 SCC 33, Van de Perre v. Edwards, 2001 SCC 60, Van Mol (Guardian ad litem of) v. Ashmore, 1999 BCCA 6, Ontario Home Builders’ Association v. York Region Board of Education, [1996] 2 S.C.R. 929, Connaught Ltd. v. Canada (Attorney General), 2008 SCC 7, [2008] 1 S.C.R. 131, Westbank First Nation v. British Columbia Hydro and Power Authority, [1999] 3 S.C.R. 134, Rogers Communications Inc. v. Châteauguay (City), 2016 SCC 23, Manitoba (A.G.) v. Metropolitan Stores, [1987] 1 S.C.R. 110, White Burgess Langille Inman v. Abbott and Haliburton Co, 2015 SCC 23

Short Civil Decisions

Shaulov v. Law Society of Ontario, 2024 ONCA 263

Keywords: Administrative Law, Regulated Professions, Lawyers, Civil Procedure, Appeals, Jurisdiction, Orders, Final or Interlocutory

Bogue v. Law Society of Ontario, 2024 ONCA 264

Keywords: Administrative Law, Regulated Professions, Lawyers, Discipline, Civil Procedure, Appeals, Motions, Panel Review, Vexatious Litigation, Rules of Civil Procedure, r 2.1.01, 2.1.02, 61.16(4)(a), Courts of Justice Act, R.S.O. 1990, c. C.43, ss 6(1)(a), 7(5), Administration of Justice Act, R.S.O. 1990, c. A.6, ss 4.10(3)(4), Tran v. Office of the Independent Police Review Director, 2023 ONSC 3207, R. v. Anderson, 2014 SCC 41

Foster v. Ontario (Children, Community & Social Services), 2024 ONCA 259

Keywords: Contracts, Real Property, Residential Tenancies, Privacy, Human Rights, Freedom of Information, Civil Procedure, Summary Judgement, Amicus Curiae, Canadian Charter of Rights and Freedoms, Human Rights Code, R.S.O. 1990, c. H. 19, Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c. F.31

Pencor Construction Inc. v. 1322295 Ontario Ltd., 2024 ONCA 273

Keywords: Contracts, Debtor-Creditors, Real Property, Mortgages, Defences, Unconscionability, Civil Procedure, Summary Judgment

De Cerigo Properties Inc. v. Raffan, 2024 ONCA 272

Keywords: Costs


CIVIL DECISIONS

6071376 Canada Inc. v. Khedmatgozar, 2024 ONCA 248

[Pepall, Sossin and Dawe JJ.A.]

Counsel:

G. J. Thorlakson and Maggie Sullivan, for the appellant

C. Cabana and I. Houle, for the respondents Mahmood Khedmatgozar, 3966305 Canada Inc. and Mary Beresford

A. Tomkins and R. Hassanzadeh, for the respondents Capital Dentistry Group Limited and Demetrius Dalios

Keywords: Torts, Fraud, Conspiracy, Fraudulent Conveyances, Badges of Fraud, Civil Procedure, Applications, Rules of Civil Procedure, r. 38.10(1), Agribrands Purina Canada Inc v Kasamekas, 2011 ONCA 460, FL Receivables Trust 2002-A v Cobrand Foods Ltd, 2007 ONCA 425, Koop v Smith (1915), 51 SCR 554, Montor Business Corporation v Goldfinger, 2016 ONCA 406, Re Fancy (1984), 46 OR (2d) 153 (H. Ct. J.)

facts:

The appellant, 6071376 Canada Inc. (“607”), was a judgment creditor of the respondent, Dr. M.K. It brought an application seeking a declaration that Dr. M.K had transferred shares in several dental practice corporations he co-owned to the respondent, Capital Dentistry Group Limited (“CDG”), in exchange for cash and shares in CDG, as a “result of a conspiracy by unlawful means amongst the [r]espondents”. The unlawful means was alleged to have been a fraudulent conveyance. 607 also sought other forms of relief against the respondents, including damages for the tort of unlawful conduct conspiracy. The application judge dismissed 607’s application, and 607 appealed. The appellant’s focus on the appeal was on the respondent CDG, not Dr. M.K, against whom it already obtained judgment in its original action.

issues:

Did the application judge err by finding that the transaction was not fraudulent and therefore not unlawful?

holding:

Appeal dismissed.

reasoning:

No.

607 argued that the application judge incorrectly applied the “badges of fraud” in evaluating the intent to defraud within the context of a transaction involving the purchase of dental practices. The argument was based on the application judge’s refusal to infer fraudulent intent from the transaction’s characteristics, which were initiated and structured by MCA, not by Dr. M.K or Dr. D.D. The application judge highlighted that the acquisition was proposed by MCA well before 607’s judgment against Dr. M.K and noted the transaction’s alignment with MCA’s historical dealings, including the combination of cash and shares at closing, suggesting no fraudulent intent. The Court concluded that the application judge’s conclusions were supported by evidence, indicating she properly assessed the situation.

Furthermore, the Court observed additional factors affirming the decision. There was no indication MCA was anything other than a legitimate buyer at arm’s length, and MCA was not directly involved in the application. Prior knowledge by 607’s counsel of Dr. M.K’s intent to sell his practices and the structured agreement to settle the judgment from the sale’s proceeds were noted, but did not alter the case’s outcome. Despite 607’s argument that the application judge should have converted the application to an action, the Court found no fault with the application judge’s handling, emphasizing that the request for conversion was never made by 607. The Court noted that decisions under r. 38.10(1) of the Rules of Civil Procedure to order that an application proceed to trial are discretionary in nature.


Peakhill Capital Inc. v. 1000093910 Ontario Inc., 2024 ONCA 261

[Harvison Young, Coroza and Gomery JJ.A.]

Counsel:

G. M. Caplan and A. Simovonian, for the appellant

R. Swan, S. Zweig and A. Nelms, for the respondent, KSV Restructuring Inc.

K. Sherkin and M. Lightowler, for the third party/respondent, 2257004 Ontario Inc.

Keywords: Bankruptcy and Insolvency, Receiverships, Sales Process, Contracts, Real Property, Agreements of Purchase and Sale of Land, Civil Procedure, Motions, Notice, Royal Bank of Canada v. Keller & Sons Farming Ltd., 2016 MCBA 46, Re Harmon International Industries Inc., 2020 SKCA 95, Marchant Realty Partners Inc. v. 2407553 Ontario Inc., 2021 ONCA 375, Ravelston Corporation Limited (Re), 2007 ONCA 135, Royal Bank of Canada v. Soundair Corp., 1991 CanLII 2727 (ONCA), CCM Master Qualified Fund v. blutip Power Technologies, 2012 ONSC 1750, Canrock Ventures LLC v. Ambercore Software Inc., 2011 ONCA 414

facts:

This case concerned a company in receivership, 1000093910 Ontario Inc., and its cross-motion to vary the receivership order and to enforce an agreement of purchase and sale of its primary asset, a piece of real estate, in Vaughan, Ontario, with a third party 2557004 Ontario Inc. (“255 Ontario”).

The motion judge exercised her discretion and declined to hear the cross-motion.

issues:
  1. Did the motion judge err in refusing to hear the cross-motion?
  2. Did the motion judge err in accepting the receiver’s proposal for a public auction of the property?
holding:

Appeal dismissed.

reasoning:
  1. No.

The appellant did not establish that the motion judge erred in refusing to hear the cross-motion.

Both the receivership order and the Rules of Civil Procedure required the appellant to give seven days notice of its cross-motion. The appellant served its notice of cross-motion and supporting materials minutes before 4:00 p.m. on the eve of the hearing date set for the receiver’s motion. The receiver did not have any opportunity to respond to the cross-motion, nor did the court have time to read the materials. In addition, the hearing list that day was already full.

Additionally, the motion judge found that the cross-motion had little chance of success.

  1. No.

The motion judge did not err in granting the receiver’s motion to engage in the sales process it proposed.

Contrary to the allegations that the receiver’s motion was inconsistent with the principles in Royal Bank of Canada v. Soundair Corp., the receiver provided evidence that the proposed process was fair and transparent; that it promoted integrity and commercial efficacy; and that it would optimize the chances of securing the best price for the assets. The Soundair principles were therefore met.


Aviva Insurance Company of Canada v. 8262900 Canada Inc (CarePartners/Community Nursing Services Foundation), 2024 ONCA 258

[Pepall J.A. (Motions Judge)]

Counsel:

T. Gleason, for the moving party

G. D.E. Adair, K.C., for the respondent

Keywords: Contracts, Insurance, Coverage, Civil Procedure, Appeals, Abandonment, Reinstatement, Res Judicata, Issue Estoppel, Hermanns v Ingle (2002), 158 OAC 21 (Ont. C.A.), Re Rogers, [1955] O.J. No. 372, 1955 CanLII 399 (ON SC), Sherwood v Cinnabar Brown Holdings Ltd, 2021 BCCA 88, Philipos v Canada (Attorney General), 2016 FCA 79, Adam and Adam v Insurance Corporation of British Columbia et al (1985), 1985 CanLII 584 (BC CA), Akagi v Synergy Group (2000) Inc, 2014 ONCA 731

facts:

Aviva Insurance Company of Canada sought to reverse its decision to abandon an appeal related to its dispute with 8262900 Canada Inc. (CarePartners) after a cyberattack led to a class action. The insurance dispute centered on whether Aviva was obligated to defend and indemnify CarePartners under its policy, following a funding agreement to cover defense costs on a 60/40 basis. However, the court had dismissed Aviva’s initial application, stating Aviva had not requested allocation of costs for different types of claims. Despite abandoning its appeal, Aviva attempted to reopen the case to argue about the allocation of indemnity costs, however, CarePartners argued that Aviva’s new claims were barred by res judicata and issue estoppel. CarePartners maintained that Aviva’s deliberate abandonment of the appeal meant it should fulfill the interim funding agreement’s obligations, while Aviva aimed to challenge the judge’s interpretation on the apportionment of costs without disputing its duty on bodily injury claims.

issues:
  1. Should the Court grant the moving party’s motion for an order setting aside its notice of abandonment of appeal, an order granting leave to file a new factum on appeal, and, in the alternative, an order extending the time for serving and filing a notice of appeal?
  2. Should the Court grant the respondent’s cross-motion for directions in respect of its cross-appeal against Aviva?
holding:

Motion dismissed. Cross-motion granted.

reasoning:
  1. No.

The Court was not persuaded that Aviva’s notice of abandonment was filed based on inadvertence, mistake, or misapprehension. Both Aviva’s counsel on the appeal and its claims analyst acknowledged in their cross-examinations that there was nothing accidental or inadvertent about the abandonment of the appeal. The appeal was abandoned because it was thought that the application judge’s bodily injury claim finding would not likely be overturned on appeal and in any event, the recovery would not be substantial.

The respondent’s counsel conceded that there was no prejudice to the respondent. He argued that there was no prejudice to either party because the parties would have to address the issues of res judicata and issue estoppel as part of the respondent’s cross-appeal and on Aviva’s new application. The Court was hard pressed to see how Aviva could succeed on an appeal as it related to the issue of apportionment. This was because the application judge expressly stated that Aviva had not asked him to allocate defence or indemnity costs between the personal injury claims and bodily injury claims in the underlying action. The Court found it difficult to see how the application judge could be criticized for not addressing an issue that was admittedly not before him. No such request was made by either party. Moreover, Aviva did not wish to challenge the application judge’s finding on bodily injury. That was the subject matter of its deliberate decision to abandon its appeal. Thus, the Court was not persuaded that the interests of justice favoured granting Aviva the relief requested.

2. Yes

The order requested was granted, save and except for the time limits which would be established by the Appeal Scheduling Unit.


Arcamm Electrical Services Ltd. v. Avison Young Real Estate Management Services LP, 2024 ONCA 251

[Gillese and Copeland JJ.A. and Wilton-Siegel J. (ad hoc)]

Counsel:

M. Mazzuca and A. Wiebe, for the respondent/moving party

J. Kaufman and B. Adams, for the appellant/responding party

Keywords: Contracts, Real Property, Construction, Civil Procedure, Summary Judgment, Appeals, Jurisdiction, Construction Act, R.S.O. 1990, c. C.30, s 50(2), Courts of Justice Act, R.S.O. 1990, c. C. 43, s 6(1)(b), Rules of Civil Procedure, r. 20, Villa Verde L.M. Masonry Ltd. v. Pier One Masonry Inc. (2001), 54 O.R. (3d) 76 (C.A.), Great Northern Insulations Services Ltd. v. King Road Paving and Landscaping Inc., 2021 ONCA 367, Soo Mill and Lumber Company Ltd. v. Possebon et al., 2023 ONCA 215

facts:

Arcamm Electrical Services Ltd. (“Arcamm”) sued Avison Young Real Estate Management Services LP and 4342 Queen St. Niagara Holdings Inc. (“Queen”) in an action brought under the Construction Act, R.S.O. 1990, c. C.30. Its statement of claim (the “Claim”) was filed, along with a certificate of action, as part of the process for registering a lien against title to the property municipally known as 4342 Queen Street, Niagara Falls, Ontario (the “Property”).

On June 8, 2021, a sudden electrical failure involving the high-voltage electrical system at the Property caused a complete power outage. The Property required power “24/7”. Within 24 hours of having been asked to restore power to the Property, Arcamm had sourced and installed temporary generators, and round-the-clock electrical power was restored to the Property. By November 1, 2021, Arcamm had permanently restored power to the Property. A final inspection that day established that its work was completed in compliance with the requisite codes and regulations. When Arcamm’s invoices for the work performed in relation to the Property remained unpaid, it successfully moved for summary judgment.

Arcamm sought an order quashing the Queen appeal from the summary judgment for want of jurisdiction. It submitted that the summary judgment was a final order captured by s. 71 of the Construction Act and, therefore, Queen’s appeal was to the Divisional Court, not to the Court. Section 71 provides that “an appeal lies to the Divisional Court from a judgment or an order on a motion to oppose confirmation of a report under this Act.”

issues:

Does the Court have jurisdiction to hear the appeal?

holding:

Motion dismissed.

reasoning:

Yes.

Firstly, the fact the Claim was styled as a proceeding under the Construction Act did not mean that the Construction Act automatically governed the appeal route. The jurisdiction of the Court was governed by the substance of the order made: Dal Bianco at para. 11, In Dal Bianco, the appeal of a Construction Act claim lay to the Court because the substance of the order under appeal related to proceedings authorized by the Bankruptcy and Insolvency Act.

In this case, the summary judgment was not made under the Construction Act. On the contrary, the motion judge refused to grant relief under that Act. Instead, the source of the motion judge’s jurisdiction was r. 20 of the Rules of Civil Procedure, a rule promulgated pursuant to the Courts of Justice Act.

Further, the relief granted was based on a claim for damages in contract for unpaid invoices, a non-statutory cause of action. The grounds of appeal highlighted the significance of this point. Queen’s primary ground of appeal was its contention that the motion judge erred in failing to find a genuine issue requiring a trial, specifically by failing to consider the defence of contributory fault and whether Arcamm’s conduct caused or contributed to the same damages claimed in contract. Self-evidently, these issues were not matters governed by the Construction Act; they were specific to the application of the test under r. 20.

Second, the cases on which Arcamm relied upon were fundamentally different from the present case. All of those cases proceeded to trial on the construction lien track under the Construction Act. In this case, r. 20 was the source of the court’s jurisdiction below. The summary judgment was not made in reliance on the Construction Act.


660 Sunningdale GP Inc. v. First Source Mortgage Corporation, 2024 ONCA 252

[MacPherson, Miller and Paciocco JJ.A.]

Counsel:

D. A. Taub and S. Mosonyi, for the appellants

M. A. Polvere and N. Kuehn, for the respondents

Keywords: Contracts, Interpretation, Penalty Clauses, Debtor-Creditor, Loan Agreements, Commitment Letters, Lender Fees, Defences, Unconscionability, Remedies, Rescission, Relief from Forfeiture, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 98, Peachtree II Associates – Dallas L.P. v. 857486 Ontario Ltd. (2005), 76 O.R. (3d) 362 (C.A.), Dunlop Pneumatic Tyre Co. Ltd. v. New Garage & Motor Co. Ltd., [1915] A.C. 79 (H.L.), Marshallzehr Group Inc. v. Ideal (BC) Developments Inc., 2021 ONCA 229, Canadian General Electric Co. v. Canadian Rubber Co. (1915), 52 S.C.R. 349, Polaroid Canada Inc. v. Continent-Wide Enterprises Limited (2000), 7 B.L.R. (3d) 37 (Ont. C.A.), Uber Technologies Inc. v. Heller, 2020 SCC 16, Shiloh Spinners Ltd. v. Harding, [1973] AC 691, Redstone Enterprises Ltd. v. Simple Technology Inc., 2017 ONCA 282, Rahbar v. Parvizi, 2023 ONCA 522, Kozel v. The Personal Insurance Company, 2014 ONCA 130, 216927 Alberta Ltd. v. Fox Creek (Town), 1990 ABCA 29, Conner v. Bulla, 2010 BCCA 457, Liscumb v. Provenzano et al. (1985), 51 O.R. (2d) 129 (H.C.J.), Ross v. T. Eaton Co. (1992), 11 O.R. (3d) 115 (C.A.), 120 Adelaide Leaseholds Inc. v. Oxford Properties Canada Ltd., [1993] O.J. No. 2801 (C.A.), 383421 Ontario Inc. v. Ole Miss Place Inc. (2003), 67 O.R. (3d) 161 (C.A.), PDM Entertainment Inc. v. Three Pines Creations Inc., 2015 ONCA 488, Highway Properties Ltd. v. Kelly, Douglas and Co. Ltd., [1971] S.C.R. 562, Norberg v. Wynrib, [1992] 2 S.C.R. 226

facts:

The respondent, 660 Sunningdale GP Inc. (“660 Sunningdale”), a developer, agreed in a commitment letter (the “Loan Agreement”) to pay a “Lender Fee” to the appellant, First Source Mortgage Corporation, on behalf of its syndicate partner, First Source Financial Management Inc. (collectively, “First Source”), as part of the consideration for a multimillion-dollar loan. The Lender Fee was deemed under the Loan Agreement to be earned upon the acceptance and execution of the commitment letter. The Loan Agreement provided that the Lender Fee was to be partially payable through a $100,000 payment made at the time the Loan Agreement was accepted and executed, with a remaining payment of $326,500 to follow.

660 Sunningdale paid the $100,000 upon executing the commitment letter but shortly after decided not to proceed with the loan, or to pay the balance of the Lender Fee. First Source registered a caution against the property, prompting 660 Sunningdale to issue a Notice of Action seeking a rescission of the Loan Agreement and an Order discharging the registered caution. The parties subsequently agreed to deposit the balance in trust and to commence litigation to resolve any payment obligations. First Source then counterclaimed.

The motion judge held that First Source was entitled to keep the $100,000 that had been paid, but 660 Sunningdale was entitled to the release of the balance from trust, plus interest, because: (1) the balance was payable under an unenforceable “penalty clause”, and (2) relief against forfeiture should be granted for the balance pursuant to s. 98 of the Courts of Justice Act. The motion judge also appears to have concluded, possibly as an alternative basis for absolving 660 Sunningdale from having to pay the balance, that the balance of the Lender Fee was not earned because the loan had not been advanced.

issues:
  1. Did the motion judge err in awarding summary judgment to 660 Sunningdale for the return of the balance of the Lender Fee, plus interest, to be paid from the funds held in trust?
  2. Did the motion judge err in failing to dismiss 660 Sunningdale’s damages claim?
holding:

Appeal allowed.

reasoning:
  1. Yes.

The Motion Judge Erred in Applying the Law of Unenforceable Penalty Clauses

The Court found that the motion judge erred in finding the balance of the Lender Fee to be an unenforceable penalty clause. Under the terms of the Loan Agreement, the balance of the Lender Fee was not a “stipulated remedy” for a breach of the contract. Rather, the balance was payable whether or not the contract was breached. In effect, the motion judge excused 660 Sunningdale from its obligations under a term of the Loan Agreement, using a body of law that governs the enforcement of penalties. But that body of law had no application.

The accepted definition of a “penalty” reinforces this point. By its very nature, a penalty clause purports to preordain the payment required if a breach occurs. Unless a term of a contract stipulates a purported remedy for a breach, it cannot be a penalty clause. Put otherwise, a penalty clause says, “if you breach the contract, look at the penalty you will have to pay.” That is not what the Lender Fee provisions say.

The Court noted that 660 Sunningdale argued that the motion judge did not err because she interpreted the Lender Fee as a stipulated remedy, and this court should defer to her interpretation. The Court disagreed. The construction that 660 Sunningdale advanced was not reflected in the motion judge’s decision. She did not address whether the Lender Fee was payable as a remedy for a breach, which is a necessary condition to it being characterized as a stipulated remedies clause. She focused only on whether the amount provided in the Lender Fee was extravagant and unconscionable in comparison to the amount First Source actually expended. By looking only at whether the amount of the balance of the Lender Fee was extravagant and unconscionable without first determining that the Lender Fee was a stipulated remedy clause, the motion judge effectively applied the independent doctrine of unconscionability rather than the doctrine of unenforceable penalty clauses.

Even if the motion judge’s decision could be read as 660 Sunningdale suggested it should be, there is no reasonable basis for that interpretation, given that the Loan Agreement provided no possible support for a finding that the Lender Fee was payable to remedy a breach. Similarly, the description of the deposit as “liquidated damages” in Article 4.17 could not support a reasonable finding, in the context of the Loan Agreement as a whole, that the Lender Fee was payable in order to remedy a breach of the Loan Agreement.

The Court, therefore, did not accept 660 Sunningdale’s submission that the motion judge interpreted the Lender Fee as a remedy for a breach. Had the motion judge interpreted the Lender Fee as a remedy for a breach, it would have been an unreasonable construction of the loan contract, amounting to a palpable and overriding error.

The Motion Judge Erred in Applying the Law of Relief of Forfeiture

The Court was also persuaded that the motion judge erred in excusing 660 Sunningdale from paying the balance of the Lender Fee based on the law of relief against forfeiture. Relief against forfeiture may be available to relieve a party of the consequences of its non-observance or breach of the terms of a contract or covenant. The balance of the Lender Fee was payable under the terms of the Loan Agreement regardless of any breach or non-observance of its terms. By granting relief against forfeiture to 660 Sunningdale from a contractual payment obligation that did not arise from any non-observance of the Loan Agreement on its part, the motion judge, in effect, applied the independent doctrine of unconscionability incorrectly in circumstances where there was no finding of inequality of bargaining power.

The paradigm circumstance in which relief against forfeiture is available is where the enforcement of a clause inserted to secure some aspect of the bargain would result in overcompensation for a breach of contract by the party seeking relief. In Canada, the application of the law of relief against forfeiture arising from breaches of contractual clauses inserted to secure performance can be observed, for example, in cases recognizing that relief against forfeiture can be granted to prevent the forfeiture of non-refundable deposits, the forfeiture of insurance coverage for imperfect compliance with policy terms, the forfeiture upon repudiation by the purchaser of installments or part or full payment of purchase monies that have been advanced, and forfeitures provided for in stipulated remedy clauses. This line of authority did not avail 660 Sunningdale relating to the balance of the Lender Fee.

The Court explained that the balance of the Lender Fee was not paid or payable, in form or in substance, as a deposit, or a part payment or installment, and it was not a stipulated remedy clause, precisely because it was not agreed to in order to secure performance of the bargain. Nor did this case involve any suggestion of “fraud, accident, mistake or surprise”, so it could not shelter under the alternative situation derived from English authority.

Narrow jurisdiction to grant relief against forfeiture has also been recognized where a party faces the loss of an option to renew a lease or extend a contractual right. The Court pointed out that this line of authority did not avail 660 Sunningdale, as this case did not involve either property rights or a failed attempt to exercise an option to renew.

In this case, the motion judge did not relieve 660 Sunningdale from any specified conduct that it engaged in that triggered its obligation to pay the balance of the Lender Fee. She, in effect, purported to relieve 660 Sunningdale not from the consequences of its conduct relating to the contract but rather from a contractual term that she found to be excessive and unconscionable in amount. It is not the role of relief against forfeiture to relieve parties from terms of a contract they agreed to, on the grounds of the improvidence of that term. That is the function of the independent doctrine of unconscionability. There was no suggestion in the motion judge’s decision that she considered whether there was an inequality of bargaining power between the parties to the Loan Agreement. Moreover, it was worth noting that 660 Sunningdale appeared to be a commercial developer capable of handling a largescale development, not a disadvantaged consumer.

The Balance of the Lender Fee was Not Contingent on the Loan Being Advanced

There were indications that the motion judge may have found, in the alternative, that 660 Sunningdale should receive the return of the balance of the Lender Fee because it was not earned, as the loan was not advanced. Those indications included the focus that she gave to a term of the Loan Agreement providing that the Lender Fee was payable out of the first advance, as well as her conclusion that the Court’s decision in Marshallzehr Group Inc. supported her decision.

The motion judge’s reliance on the Marshallzehr Group Inc. decision strongly suggested that she concluded that the Lender Fee in this case was similarly unearned, and not payable because the loan had not been advanced. If the motion judge did arrive at this conclusion, the Court held that she made a palpable and overriding error by arriving at an unreasonable interpretation of the contract and/or that she made an extricable legal error by failing to consider the whole of the Loan Agreement. The Loan Agreement before the motion judge was materially different than the loan agreement at issue in Marshallzehr Group Inc.

  1. No.

In its statement of claim, 660 Sunningdale sought $1 million in punitive damages and $50 million in damages against First Source for disrupting its business by causing 660 Sunningdale to terminate its loan commitment as a result of First Source’s unreasonable behaviour. First Source joined issue with that claim, denying that it committed any breaches of the Loan Agreement.

The motion judge decided that 660 Sunningdale had not established the breach, but she did not dismiss or address its damage claim. The Court held that she did not have to do so. 660 Sunningdale abandoned its damages claim in its summary judgment motion factum, stating that it was “foregoing any other damages and is simply requesting a release of the funds”. The damages claim therefore ended with its abandonment without the need for a dismissal of those claims.


Bell v. Amini, 2024 ONCA 260

[Pepall, George and Dawe JJ.A.]

Counsel:

M.B., acting in person

S. M. Sack and D. R. Miller, for the respondent

Keywords: Torts, Professional Negligence, Lawyers, Defamation, Civil Procedure, Summary Judgment, Rules of Civil Procedure, r. 20.04(2), Bell v. Fishka, 2022 ONCA 683, Grant v. Torstar, 2009 SCC 61, Haskett v. Equifax Canada Inc. (2003), 63 O.R. (3d) 577 (C.A.), Hyrniak v. Mauldin, 2014 SCC 7

facts:

The respondent, a lawyer, had agreed to represent the appellant on a Motion to Change in a family law matter on a Legal Aid certificate. According to the respondent, the appellant had not followed the respondent’s recommended litigation strategy and instead adopted her own approach, which the respondent described as “unreasonable [and] unnecessarily hostile”.

On February 13, 2019, the appellant filed a complaint against the respondent with Legal Aid Ontario (“LAO”) and applied for a change of solicitor. The respondent responded to the complaint. LAO, after concluding that the appellant had conducted herself in an unreasonable manner, declined to approve further coverage. The appellant represented herself on the Motion to Change, which was ultimately unsuccessful.

On February 1, 2021, the appellant commenced an action against the respondent claiming that the respondent was negligent, had committed malpractice by withdrawing her services, and had defamed her in her communications with LAO.

issues:

Issue:

  1. Did the motion judge err in concluding that there was no viable negligence claim?
  2. Did the motion judge err in their determination regarding defamation?
  3. Did the motion judge err in summarily dismissing the appellant’s action against the respondent?
holding:

Appeal dismissed.

reasoning:
  1. No.

There were three problems with this submission. First, while there was a dispute about the timing of the allegation, the motion judge had found, and the appellant had conceded, that she had accused the respondent of colluding with opposing counsel, to her detriment. Second, the motion judge, the judge who heard the Motion to Change, and LAO, each concluded that the appellant had acted unreasonably in the proceedings. The Court has already found, when considering a motion related to the family law matter, that the appellant had “repeatedly litigated issues that have already been decided, engaged in abusive behaviour, and deliberately failed to comply with clear court orders”: Bell at para. 4. And third, when the respondent ended the solicitor-client relationship, the Motion to Change had not yet been scheduled, which afforded the appellant sufficient time to prepare.

The Court noted that there was no evidence in the record that could support a conclusion that the respondent’s conduct amounted to negligence.

  1. No.

The appellant had been advised, even before the retainer was terminated, that the respondent would have to provide LAO with updates. In any event, the respondent had no choice but to respond to the February 13, 2019 complaint.

Moreover, truth is a complete defence to a defamation claim: Grant at paras. 32-33; Haskett at para. 54. The motion judge had concluded that the respondent’s statements to LAO were truthful and accurate.

  1. No.

The motion judge referred to and applied the correct test for summary judgment as set out in Hyrniak.

The Court noted that after the motion judge considered the powers available to her under r. 20.04(2) of the Rules of Civil Procedure, she concluded that she could “make a just decision on the evidentiary record” before her. This evidence, per the motion judge, was sufficient to demonstrate that comments made by the appellant led to a breakdown of the solicitor-client relationship. As explained by Karakatsanis J. in Hyrniak, the exercise of powers available to motion judges on summary judgment applications attracts deference on appeal: Hyrniak, at paras. 81-84. The findings made by the trial judge were available to her on the record. The Court concluded that there was no basis on which to interfere with the motion judge’s decision.


Roalno Inc. v. Schaefer, 2024 ONCA 262

[Trotter, Thorburn and Dawe JJ.A.]

Counsel:

S. Bieber, for the appellant/respondents by way of cross-appeal

R. W. Scriven, for the respondents Dale Schaefer and Maurice Freiburger

P. Loucks and T. Ivanina, for the respondents/cross-appellants Brian Freiburger and Kenneth Freiburger

Keywords: Contracts, Real Property, Easements, Anticipatory Breach, Remedies, Declarations, Specific Performance, Abatements, Road Access Act, R.S.O. 1990, c. R.34, Land Titles Act, R.S.O. 1990, c. L.5, s. 51, 1043 Bloor Inc v 1714104 Ontario Inc, 2013 ONCA 91, 3999581 Canada Inc v 1394734 Ontario Inc, 2007 ONCA 312, Whitmell v Ritchie (1994), 20 O.R. (3d) 424 (C.A.), Margettie v Snell, 2009 ONCA 838, Spirent Communications of Ottawa Limited v Quake Technologies (Canada) Inc, 2008 ONCA 92

facts:

The appeal arose out of a real estate transaction that failed after the parties both mistakenly came to believe that the property being sold and purchased was subject to a prescriptive easement. The would-be purchaser, the appellant Roalno Inc. (“Roalno”), owned and controlled by S.S, refused to close unless the vendors either reduced the sale price or took steps to have the supposed easement extinguished. When the vendors refused to do either of these things, Roalno refused to close. It then sued for specific performance with an abatement. The trial judge refused the relief on the basis that Roalno had breached the agreement of purchase and sale by refusing to close. Roalno appealed from this decision.

issues:
  1. Did the trial judge err in her statement that “S.S should have closed and argued about the interpretation of the agreement later,” given that a purchaser seeking specific performance with an abatement is not required to close at the original purchase price to preserve the right to seek such remedy?
  2. Did the trial judge err by finding that Roalno breached the contract when it refused to close on April 30, 2018?
  3. Should an order be granted for Roalno’s request for a declaratory order that the road running over the F brothers’ northern properties was an “access road” under the Road Access Act in relation to the Vendors’ properties and an order be granted under the Act prohibiting the F brothers from obstructing the road?
  4. Should the cross-appeal by the F brothers be allowed?
holding:

Appeal and cross-appeal dismissed.

reasoning:
  1. No.

The Court accepted that in situations where a purchaser of land was entitled to claim the remedy of specific performance with an abatement, because “there was a discrepancy between what the vendor had agreed to convey and what the vendor can convey,” the purchaser was not required to close at the original purchase price as a precondition for obtaining such remedy. However, the Court found that this principle did not assist Roalno. The Court was prepared to assume for the purpose of its analysis that S.S meant for the para. 28.2 “representation and warranty” in the Agreement of Purchase and Sale (APS) to be a condition, and that if there had in fact been an unregistered easement over the property, Roalno would have had the option of either terminating the contract or seeking specific performance with an abatement. However, everyone agreed that there never was any such easement.

In the Court’s view, Roalno could not rely on S.S’s legally erroneous belief that an easement by prescription might exist to justify its refusal to close at the agreed-on purchase price. The Court was also not persuaded that Roalno could retroactively justify its refusal to close by invoking the possibility of the respondents relying on the Road Access Act. S.S’s evidence was that he only learned about the existence of the Road Access Act months later, once litigation was underway. The Court was not persuaded that he could justify Roalno’s refusal to close based on a consideration that was not in his mind at the time.

2. No.

The Court accepted that the letter from the vendor’s lawyer (S.K) of April 25, 2018, could be understood as indicating the Vendors’ intention not to be bound by the APS because they mistakenly believed that they would be unable to fulfil one of its terms. However, S.K sent this letter in response to S.S’s earlier April 13, 2018 email and F.G’s April 23 and 24, 2018 letters, all of which made it equally clear that Roalno had no intention of fulfilling its own end of the bargain. The correspondence from S.S and F.G would have left a reasonable person in the Vendors’ position with no doubt that Roalno did not intend to complete the transaction according to the terms of the APS.

The Court found that S.K’s April 25, 2018 letter could not be properly characterized as an anticipatory breach of the APS by the Vendors. It was Roalno who anticipatorily breached the contract when S.S sent his April 13, 2018 email, reaffirmed by F.G’s letters ten days later. The Court was satisfied that when S.K sent his April 25, 2018 letter, he was communicating his clients’ decision that they would accept the repudiation, unless the parties agreed to amend the APS to remove para. 28.2. This led to the contract’s end, disentitling Roalno from being granted specific performance, either with or without an abatement. Moreover, as the innocent party in the breach, the Court found that the Vendors were entitled to keep Roalno’s $5,000 deposit.

3. The Court did not address this issue.

The Court found that its conclusion made it unnecessary to address Roalno’s request for a declaratory order that the road running over the F brothers’ northern properties was an “access road” under the Road Access Act in relation to the Vendors’ properties, and for an order under the Act prohibiting the F brothers from obstructing this road, since these requests were both contingent on Roalno being granted specific performance.

4. The Court did not address this issue.

The Court’s conclusion that Roalno’s appeal should be dismissed also made it unnecessary for the Court to address the F brothers’ cross-appeal, since the relief they sought was also contingent on Roalno’s appeal being allowed and it being awarded specific performance.


National Steel Car Limited v. Independent Electricity SystemOperator, 2024 ONCA 265

[Pepall, Harvison Young and Favreau JJ.A.]

Counsel:

J. R. Morse, D. M. Trafford, and E. A. Cherniak, K.C., for the appellant, National Steel Car Limited

A. Mark and M. Ouanounou, for the respondent, Independent Electricity System Operator

P. Ryan and K. Leung, for the respondents, the Attorney General of Ontario and His Majesty the King in Right of Ontario

Keywords: Energy, Electricity, Price Regulation, Constitutional Law, Taxation, Division of Powers, Pith and Substance, Intra Vires, Civil Procedure, Applications, Evidence, Admissibility, Information and Belief, Expert Evidence, Impartiality, Constitution Act, 1867, Green Energy and Green Economy Act, 2009, S.O. 2009, c. 12, Electricity Act, 1998, S.O. 1998, c.15, Sched. A, Ontario Energy Board Act, 1998, S.O. 1998, c.15, Sched. B, Energy Statute Law Amendment Act, 2016, S.O. 2016, c. 10, Taxpayer Protection Act, 1999, S.O. 1999, c. 7, Sched. A, Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c. F.31, Rules of Civil Procedure, rr. 4.1.01, 39.01(5), National Steel Car Limited v. Independent Electricity System Operator, 2019 ONCA 929, Re: Exported Natuaral Gas Tax, [1982] 1 S.C.R. 1004, Allard Contractors Ltd. v. Coquitlam (District), [1993] 4 S.C.R. 371, Reference re Firearms Act, 1998 ABCA 305, R. v. Palmer, 2021 ONCA 348, Bruno v. Dacosta, 2020 ONCA 602, Farej v. Fellows, 2022 ONCA 254, Housen v. Nikolaisen, 2002 SCC 33, Van de Perre v. Edwards, 2001 SCC 60, Van Mol (Guardian ad litem of) v. Ashmore, 1999 BCCA 6, Ontario Home Builders’ Association v. York Region Board of Education, [1996] 2 S.C.R. 929, Connaught Ltd. v. Canada (Attorney General), 2008 SCC 7, [2008] 1 S.C.R. 131, Westbank First Nation v. British Columbia Hydro and Power Authority, [1999] 3 S.C.R. 134, Rogers Communications Inc. v. Châteauguay (City), 2016 SCC 23, Manitoba (A.G.) v. Metropolitan Stores, [1987] 1 S.C.R. 110, White Burgess Langille Inman v. Abbott and Haliburton Co, 2015 SCC 23

facts:

This appeal involved a constitutional challenge to electricity costs. In 2009, the Government of Ontario designed a feed-in-tariff renewable electricity procurement program (the “FIT Program”) pursuant to the Green Energy and Green Economy Act (the “Green Energy Act”). Under the FIT Program, suppliers of renewable energy were paid to “feed in” energy into Ontario’s electricity grid. As a result, the cost of electricity increased substantially for the appellant, National Steel Car Limited, a heavy user of electricity.

Before the application judge, it took the position that the FIT Program was principally undertaken and intended to create economic stimulus in the wake of the 2008 financial crisis and to redress perceived economic harm suffered by Indigenous communities, rural communities, municipalities, and co-operatives due to the financial crisis. It argued that the FIT Program was designed to achieve a general economic purpose, not a regulatory purpose, and as such, the costs of the FIT Program, as paid through the Global Adjustment, were not valid regulatory charges. Rather, they were a colourable attempt to tax through regulation contrary to s. 53 of the Constitution Act, 1867, which required taxes to be authorized by the legislature. The application judge disagreed with the appellant and concluded that the costs of the FIT Program were valid regulatory charges.

issues:
  1. Did the application judge err in finding that for the appellant to succeed in its colourability claim, it had to establish that the Government of Ontario had “lied”?
  2. Did the application judge err by failing to provide reasons that permitted appellate review?
  3. Did the application judge err in finding that the Stimulus Goals were a valid regulatory purpose?
  4. Did the application judge err in finding that the appellant’s expert witnesses were biased?
holding:

Appeal dismissed.

reasoning:
  1. No.

The appellant submitted that to succeed in its colourability argument, the application judge improperly required it to establish that Ontario had lied about the purposes of the FIT Program. Rather, the required analysis was whether the purpose of the legislation was, in pith and substance, to achieve a purpose other than that suggested by the legislation. According to the appellant, the alternate and invalid purpose was the pursuit of the Stimulus Goals. The “colourability” doctrine is invoked when a statute bears the formal trappings of a matter within jurisdiction, but in reality, is addressed to a matter outside jurisdiction. An ulterior motive was not a prerequisite to a finding of colourability, but in some cases, Parliament might try to invade an area of provincial jurisdiction by disguising the true nature of its legislation. The appellant raised the issue of falsehood and intent and the application judge responded to it. The Court found that the appellant made the strategic choice to frame its colourability argument in a way to challenge the veracity of the stated purposes of the regulation. The Court concluded that the application judge’s references were reflective of the appellant’s own argument.

2. No.

Evidentiary disputes between parties

  1. i) The appellant contended that the application judge incorrectly supported the FIT Program’s regulatory objectives deeming them unsupported except for the last, which it labeled as mere economic stimulus. Despite these objections, the application judge ruled that the FIT Program’s component of the Global Adjustment was a valid regulatory charge linked to electricity regulation and could serve economic stimulus purposes. The Court found that the conclusion was well-supported by evidence, allowing for appellate review. The Court noted that the application judge conducted a thorough pith and substance analysis, finding that the economic stimulus was a secondary aspect of the program’s legitimate regulatory goals.

(a) Coal-Fired Generation

The appellant argued that the trial judge erred in finding that eliminating coal-fired generation was a goal of the FIT Program, noting that replacement by gas-fired processes was already planned before its implementation. The respondents argued that actual energy production varies and does not always match capacity and emphasized that the FIT Program sought to integrate various energy sources, including nuclear and renewables, in a broad, evolving strategy. The Court upheld that the objective to phase out coal power was appropriately recognized as part of the FIT Program’s comprehensive energy goals.

(b) Air Quality and Healthcare Costs

The application judge found that improving air quality and reducing healthcare costs were among the purposes of the FIT Program, despite the appellant’s claim that no studies had shown such benefits would result from the program. Ample evidence supported the view that the FIT Program aimed to enhance environmental outcomes and public health. The FIT Directive aimed to increase the capacity of renewable energy supply to reduce emissions. The Court found that the absence of specific contemporaneous studies did not detract from the program’s regulatory intent to improve the environment, and such studies were not necessary to confirm the government’s policy goals or the program’s effectiveness in achieving environmental benefits.

(c) Planning

The application judge recognized planning for an impending energy supply shortage as a purpose of the FIT Program, countering the appellant’s claim that no imminent need justified the extensive renewable energy goals under the FIT Program based on 2008 testimony. The Ontario Government had revised the original Integrated Power System Plan to significantly boost renewable energy, reflecting a 2008 policy change aimed at addressing potential shortages due to retiring coal-fired and some nuclear generation. The Court upheld this policy adjustment, finding it reasonable within Ontario’s long-term energy strategy and aligning with the goal of adequacy, safety, reliability, and sustainability under the Electricity Act, 1998. The evidence supported the application judge’s endorsement of these new targets and the broader policy shift, validating the necessity for forward-looking, comprehensive energy planning.

(d) Fostering Renewable Energy

The appellant contended that the FIT Program’s high prices made it unnecessary for procuring renewable energy. The application judge upheld the FIT Program’s pricing, which was intended to cover costs plus a reasonable return, particularly to boost participation among Indigenous and community groups through “price adders.” Expert witnesses noted that prior programs had high administrative costs and failed to adequately support local and Indigenous involvement, prompting the need for better incentives under the FIT Program. The Court found that the FIT Program aimed to advance renewable energy generation in Ontario, fulfilling broader governmental regulatory, environmental, and social goals, and was not merely economic stimulus, as the extra costs were a minor part of the overall Global Adjustment.

(e) Indigenous and Community Participation

The FIT Directive aimed to encourage Indigenous and community participation in Ontario’s electrical system, a goal unchallenged by the appellant and upheld by the application judge. The application judge recognized the FIT Program as key to regulating electricity, potentially providing economic stimulus, since the Global Adjustment covered only actual costs and did not fund general revenues. Section 25.35(2) of the Electricity Act, 1998, and expert testimony, affirmed that electricity policies often pursued multiple objectives—economic, social, or environmental. The Court agreed with the application judge’s assessment, acknowledging the FIT Program’s regulatory and societal aims, and found his reasons sufficient for appellate review.

Admissibility of hearsay evidence

  1. ii) The appellant argued that the application judge failed to address hearsay allegations concerning the FIT prices allowing generators to recover costs plus an 11 percent return as the target for a reasonable return. However, the Court found this rate appropriately supported by rule 39.01(5) of the Rules of Civil Procedure (the admissibility of evidence of non-contentious facts on information and belief), FIPPA documents, and the appellant’s expert testimony. The application judge accepted the rate without further validation, categorizing charges limited to actual cost recovery within a regulatory scheme as regulatory charges, not taxes. Therefore, the Court determined no further inquiry was necessary from the application judge.

Onus to establish connection between the cost of the FIT Program and the regulation of electricity

iii) The appellant also submitted that the application judge’s reasons were insufficient because they failed to address the burden on the respondents to establish a connection between the cost of the FIT Program and the regulation of electricity. The Court agreed with the application judge that it did not matter who bore the onus of proof. If the onus was on the respondents, they succeeded; if the onus was on the appellant, it failed. The Court found no fault in the application judge’s decision. The application judge did not deem it necessary to discuss the onus because the respondents’ arguments prevailed, showing the charge was a valid regulatory charge.

3. No.

The appellant challenged the application judge’s findings that the goals of economic stimulus were legitimate regulatory objectives within the realm of energy procurement. The appellant contended that the judge erred by not considering these goals as extraneous to Ontario’s electricity system’s mandate for general or specific economic development. They argued that accepting such goals within regulatory policies allowed governments too broad a scope to enact economic policies under any regulatory guise, potentially contravening constitutional protections specified in s. 53 of the Constitution Act, 1867. The crux of their argument was against the use of regulatory charges primarily aimed at economic stimulation as conflicting with constitutional norms.

(i) The pith and substance of the FIT Program was not the pursuit of the Stimulus Goals

The appellant argued that the primary purpose of the FIT Program was to pursue Stimulus Goals, relying on statements from former Minister Smitherman and Assistant Deputy Minister Lo, which were considered hearsay. However, these statements did not conclusively indicate that economic stimulus was the predominant purpose of the program. The application judge found that the Government was not strictly bound by the advice it received and that adopting a policy with some opposition did not necessarily mean its regulatory purpose was overtaken by stimulus aims. Moreover, checks for transmission and distribution availability were standard before awarding FIT contracts, contradicting claims that these contracts served solely as economic stimulus. The assertion that the FIT Program was a tax was also rejected by the Court, as was the reliability of the appellant’s expert evidence, which the application judge questioned for impartiality. The Court concluded that the appellant’s arguments about the FIT Program’s primary intent for economic stimulus were unsupported by meaningful evidence.

(ii) The FIT Program component of the Global Adjustment is a valid regulatory charge

The application judge found that the FIT Program was part of a clear regulatory scheme aimed at incentivizing renewable energy in Ontario, distinguishing it from a revenue-raising mechanism. Payments to electricity suppliers were related to their contributions to the electricity grid, with the Global Adjustment ensuring that costs to consumers reflected payments to generators, covering only actual costs without generating surplus revenue. The application judge also recognized that economic, social, and environmental considerations were valid in electricity regulation, countering the appellant’s argument that the program’s focus on economic stimulus was inappropriate. The Court found that the multifaceted role of electricity in Ontario’s economy underscored the legitimacy of integrating broader economic and social goals into electricity policy.

4. No.

The application judge admitted the evidence of the two experts by the appellant and decided to give it the weight it deserved in light of all the evidence. However, the application judge found the experts to be entrenched in bias. Specifically, he found that they failed at the fourth of the Mohan criteria in the threshold stage, which required, as per rule 4.1.01 of the Rules, the witness to be independent, objective, and impartial. The Court found that the application judge’s finding was open to him and was owed deference. Moreover, the application judge admitted their evidence and the Court saw no basis on which to interfere.



SHORT CIVIL DECISIONS

Shaulov v. Law Society of Ontario, 2024 ONCA 263

[MacPherson, Paciocco and Zarnett JJ.A.]

Counsel:

A.S., acting in person

S. Aylward and K. Bernofsky, for the respondents Law Society of Ontario, Performance Assessment Group Inc., John Braham and Michael Williams

Keywords: Administrative Law, Regulated Professions, Lawyers, Civil Procedure, Appeals, Jurisdiction, Orders, Final or Interlocutory

Bogue v. Law Society of Ontario, 2024 ONCA 264

[Brown J.A.]

Counsel:

G.B., acting in person

J. Elcombe, for the respondent Law Society of Ontario

L. Saad, for the respondent Colin Bogue

Keywords: Administrative Law, Regulated Professions, Lawyers, Discipline, Civil Procedure, Appeals, Motions, Panel Review, Vexatious Litigation, Rules of Civil Procedure, r 2.1.01, 2.1.02, 61.16(4)(a), Courts of Justice Act, R.S.O. 1990, c. C.43, ss 6(1)(a), 7(5), Administration of Justice Act, R.S.O. 1990, c. A.6, ss 4.10(3)(4), Tran v. Office of the Independent Police Review Director, 2023 ONSC 3207, R. v. Anderson, 2014 SCC 41

Foster v. Ontario (Children, Community & Social Services), 2024 ONCA 259

[Roberts, George and Monahan JJ.A.]

Counsel:

G.F., acting in person

L. Brazil, for the respondent

Keywords: Contracts, Real Property, Residential Tenancies, Privacy, Human Rights, Freedom of Information, Civil Procedure, Summary Judgement, Amicus Curiae, Canadian Charter of Rights and Freedoms, Human Rights Code, R.S.O. 1990, c. H. 19, Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c. F.31

Pencor Construction Inc. v. 1322295 Ontario Ltd., 2024 ONCA 273

[van Rensburg, Zarnett and George JJ.A.]

Counsel:

D. Richter, for the appellants

J. Butson, for the respondent

Keywords: Contracts, Debtor-Creditors, Real Property, Mortgages, Defences, Unconscionability, Civil Procedure, Summary Judgment

De Cerigo Properties Inc. v. Raffan, 2024 ONCA 272

[Lauwers, Roberts and Monahan JJ.A.]

Counsel:

M. Mazzuca and B. Masters, for the appellants

D. Berlach and N. Eklove, for the respondent

L. Melconian, for Karen Caradonna

Keywords: Costs


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.

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

Good afternoon.

Following are this week’s summaries of the Court of Appeal for Ontario for the week of April 1, 2024.

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In Bank of Nevis International Limited v. Kucher, the motion judge enforced a forum selection clause in favour of the courts of the Caribbean nation of Nevis, and stayed the action for want of jurisdiction or, in the alternative, on the basis of forum non conveniens. The appeal was dismissed.

In 1284225 Ontario Limited v. Don Valley Business Park Corporation, the Court set aside the application judge’s interpretation of a parking agreement due to the incorrect application of legal principles.

In Henry v. Zaitlen, a MedMal case, the Court dismissed the appeal and upheld the jury’s findings against the doctor on liability and damages.

Crosslink Bridge Corp. v. Fogler, Rubinoff LLP involved the limitation period for assessing a lawyer’s accounts.

In Grandfield Homes (Kenton) Ltd. v. Chen, the Court dismissed an appeal involving a failed real estate transaction. The vendor was successful in retaining the deposits, but was unsuccessful in getting a trial on further damages, as that had not been pleaded in the application record.

Wishing everyone an enjoyable weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Table of Contents

Civil Decisions

Crosslink Bridge Corp. v. Fogler, Rubinoff LLP, 2024 ONCA 230

Keywords: Contracts, Solicitor and Client, Assessments, Civil Procedure, Jurisdiction, Limitation Periods, Solicitors Act, R.S.O. 1990, c. S.15, s 3(a)(b), 4, 11, Fellowes, McNeil v. Kansa Canadian Management Services Inc. (1997), 34 O.R. (3d) 301 (C.A.), Shapiro, Cohen, Andrews, Finlayson v. Enterprise Rent-a-Car Company. (1998), 38 O.R. (3d) 257 (C.A.), Re Reid and Goodman & Goodman (1974) O.R. (2d) 447 (H.C.), Bunt v. Assuras (2003), 63 O.R. (3d) 622 (S.C), Fiset v. Falconer, 2005 CanLII 33783 (Ont. S.C.)

Bank of Nevis International Limited v. Kucher, 2024 ONCA 240

Keywords: Breach of Contract, Torts, Defamation, Civil Procedure, Private International Law, Jurisdiction, Forum Selection Clauses, forum non conveniens, Novatrax International Inc. v. Hägele Landtechnik GmbH, 2016 ONCA 771, Momentous.ca Corp. v. Canadian American Assn. of Professional Baseball Ltd., 2010 ONCA 722, Haaretz.com v. Goldhar, 2018 SCC 28, Van Breda v. Village Resorts Ltd., 2012 SCC 17

Varjacic v. Radoja, 2024 ONCA 233

Keywords: Unincorporated Voluntary Associations, Governance

Grandfield Homes (Kenton) Ltd. v. Chen, 2024 ONCA 236

Keywords: Contracts, Real Property, Agreements of Purchase and Sale of Land, Damages, Civil Procedure, Applications, Trial of Issue, Bifurcation, Rules of Civil Procedure, rr. 14.05, 38.04, Rodaro v. Royal Bank of Canada (2002), 59 O.R. (3d) 74, Mihaylov v. 1165996 Ontario Inc., 2017 ONCA 116, Voreon Inc. v. Matas Management Services Inc., 2023 ONCA 745, 1100997 Ontario Limited v. North Elgin Centre Inc., 2016 ONCA 848, Angeloni v. Di Millo v. 2099232 Ontario Inc., 2018 ONCA 1051 Estate of Francesco Angeloni, 2021 ONSC 3084, Primont (Castelmont) Inc. v. Friuli Benevolent Corporation, 2023 ONCA 477

1284225 Ontario Limited v. Don Valley Business Park Corporation, 2024 ONCA 247

Keywords: Contracts, Interpretation, Civil Procedure, Appeals, Standard of Review, Palpable and Overriding Error, Correctness, Heritage Capital Corp. v. Equitable Trust Co., 2016 SCC 19

Henry v. Zaitlen, 2024 ONCA 243

Keywords: Torts, Negligence, MedMal, Civil Procedure, Jury Trials, McLean v. McCannell, [1937] S.C.R. 341, Stilwell v. World Kitchen Inc., 2014 ONCA 770, Goodwin (Litigation Guardian of) v. Olupona, 2013 ONCA 259, Sacks v. Ross, 2017 ONCA 773, Cheung v. Samra, 2022 ONCA 195,  Gutbir (Litigation guardian of) v. University Health Network, 2012 ONCA 66, El Dali v. Panjalingam, 2013 ONCA 24, Vancouver-Fraser Park District v. Olmstead, [1975] 2 S.C.R. 831, Vancouver-Fraser Park District; Graham v. Hodgkinson (1983), 40 O.R. (2d) 697 (C.A.), Adam v. Campbell (1950), 3 D.L.R. 449 (S.C.C.), Hackman v. Vecchio (1969), 4 D.L.R. (3d) 444 (B.C.C.A.), Lapointe v. Hôpital Le Gardeur, [1992] S.C.R. 351, Ter Neuzen v. Korn, [1995] 3 S.C.R. 674, McLean v. Knox, 2013 ONCA 357, Wade v. C.N.R, [1978] 1 S.C.R. 1064

Short Civil Decisions

Grillone (Re), 2024 ONCA 244

Keywords: Bankruptcy and Insolvency, Civil Procedure, Appeals, Orders, Abuse of Process, Vexatious Litigants, Rules of Civil Procedure, r. 37.16

Avedian v. Enbridge Gas Distribution Inc. (Enbridge Gas Distribution), 2024 ONCA 241

Keywords: Civil Procedure, Appeals, Stay Pending Appeal, Jurisdiction, Final or Interlocutory, Orders, Variation, RJR-MacDonald Inc. v. Canada (Attorney General), [1995] 3 S.C.R. 199

Hart v. Balice, 2024 ONCA 249

Keywords: Civil Procedure, Appeals, Vexatious Litigants, Courts of Justice Act, R.S.O. 1990, c. C.43, ss 140(1), Rules of Civil Procedure, rr. 2.1.03(1), 59.06(2)(a), 61.16(6.1), Canada Mortgage and Housing Corporation v. Hart, 2023 ONSC 3544, Kallaba v. Bylykbashi (2006), 265 D.L.R. (4th) 320


CIVIL DECISIONS

Crosslink Bridge Corp. v. Fogler, Rubinoff LLP, 2024 ONCA 230

[Miller, Copeland and Gomery JJ.A.]

Counsel:

J. Radnoff, for the appellants

H. Abramsky, for the respondents

Keywords: Contracts, Solicitor and Client, Assessments, Civil Procedure, Jurisdiction, Limitation Periods, Solicitors Act, R.S.O. 1990, c. S.15, s 3(a)(b), 4, 11, Fellowes, McNeil v. Kansa Canadian Management Services Inc. (1997), 34 O.R. (3d) 301 (C.A.), Shapiro, Cohen, Andrews, Finlayson v. Enterprise Rent-a-Car Company. (1998), 38 O.R. (3d) 257 (C.A.), Re Reid and Goodman & Goodman (1974) O.R. (2d) 447 (H.C.), Bunt v. Assuras (2003), 63 O.R. (3d) 622 (S.C), Fiset v. Falconer, 2005 CanLII 33783 (Ont. S.C.)

facts:

The appellants appealed the order of the motion judge setting aside an assessment order under the Solicitors Act (the “Act”) as statute-barred and ordering them to pay the respondents’ outstanding fees.

The matter came before the motion judge as a result of the respondents challenging the jurisdiction of the assessment officer at the outset of the scheduled assessment on the basis that reference for assessment of at least some of the accounts was statute-barred. That question turned, in part, on whether the accounts were final or interim. The assessment officer referred the issue of whether the accounts were final or interim to a judge for directions.

issues:
  1. Did the motion judge err in finding that all the accounts were final accounts?
  2. Did the motion judge err in finding that an assessment of the first 29 accounts was statute-barred?
  3. Did the motion judge err in her analysis of the last three accounts?
holding:

Appeal allowed, in part.

reasoning:
  1. No.

The appellants argued that the motion judge erred in finding that all of the accounts were final accounts. The appellants argued that only the last account, delivered on October 22, 2018 (after the assessment order was issued), was a final account and that the previous 31 accounts were interim. The appellants argued that the motion judge erred in law in failing to consider if the accounts were part of “a continuum”.

The Court was not persuaded that the motion judge erred in law in her analysis of whether the accounts were final or interim. The Court found no legal error in her summary of the legal principles to be applied in considering whether an account is final or interim. Although the language of “a continuum” is used in some of the cases to describe the relationship between multiple accounts that are found to be interim, it is not a distinct legal test.

Nor was the Court persuaded that the motion judge committed a palpable and overriding error of fact. The case law is clear that the question of whether an account is final or interim is a question of fact. The finding of the trial judge that all of the accounts were final was open to her on the record and was owed deference.

  1. No.

In light of the finding that all of the accounts were final, there was no error in the motion judge’s conclusion that an assessment of the first 29 accounts at issue was statute-barred.

The first 29 accounts were delivered between May 5, 2014, and May 29, 2017, inclusive. They were all paid by the appellants. The assessment order was issued October 3, 2018. Unless special circumstances are established by the appellants, s. 4(1) of the Act bars a reference for assessment after 12 months from the delivery of the account. Unless special circumstances are established, s. 11 of the Act bars a reference for assessment where an account has been paid. The appellants did not seek to establish special circumstances either before the motion judge or on appeal.

Section 3(a) of the Act allows a client to requisition the delivery and assessment of a solicitor’s account, where the retainer is not disputed and there are no special circumstances. Read in conjunction with s. 3(b), which provides for requisition of an assessment “of a bill already delivered, within one month from its delivery”, it is clear that s. 3(a) of the Act only applies in circumstances where a solicitor has not yet delivered an account at the time the assessment is requisitioned. Section 3(a) has no limitation period because a limitation period in relation to assessment of a solicitor’s account cannot run before an account is delivered to the client.

The assessment order issued by requisition in this case did not reference either s. 3(a) or 3(b) of the Act. The text on the preprinted portion of the order included language ordering the solicitors to “deliver to the applicant(s) a bill of fees, charges and disbursements” within 14 days of service of the order. That language appeared consistent with s. 3(a) of the Act. But whatever the language of the order, the circumstances were clear that s. 3(a) of the Act could not apply to the first 31 accounts because they had already been delivered to the appellants at the time the assessment order was requisitioned.

  1. Yes.

The motion judge applied the same analysis to all 32 accounts in considering whether assessment was statute-barred. This was a legal error.

The motion judge approached the issue of the limitation period for all the accounts on the basis that the appellants were required either: (i) to show that all the accounts were interim and not final, or (ii) to establish special circumstances. This was correct for the first 29 accounts, but not for the last three accounts.

The second-last and third-last accounts were dated November 27, 2017, and April 6, 2018. They were not paid by the appellants. The trial judge did not err in finding that these accounts were final accounts. The Superior Court’s discretion with respect to ordering assessment of unpaid accounts where referral for assessment is sought between one and twelve months after the account is delivered derives from the court’s inherent jurisdiction as circumscribed by the Act. The statutory bar in s. 3(b) of the Act applies to disallow an automatic right of assessment by requisition where assessment is sought more than one month after the account was delivered. However, the requirement to establish special circumstances in ss. 4 and 11 of the Act do not apply because the accounts are less than twelve months old (s. 4) and unpaid (s.11).

However, the motion judge did err in holding that the appellants were required to establish special circumstances to have these accounts referred for assessment. A different legal analysis applies to accounts where the assessment is sought between one and twelve months after the account is delivered and the account remains unpaid by the client.

A client is not required to show special circumstances in order to obtain a referral for assessment of accounts that have been delivered more than one month but less than twelve months before an assessment is sought, and that remain unpaid. Rather, a judge of the Superior Court has discretion whether to exercise its inherent jurisdiction to order an assessment. In considering whether to exercise the discretion, a judge need only be satisfied that it is just and equitable that a reference for an assessment be made. In Fellowes, the Court held that, for unpaid accounts where assessment is sought between one and twelve months after the account is delivered: “In the usual circumstances, little is required for that jurisdiction to be exercised”.

With respect to the last account, the trial judge erred in law in finding an assessment was statute-barred. No limitation period was triggered for the last account as it fell within s. 3(a) of the Act. At the time the assessment order was requisitioned, on October 3, 2018, the last account had not yet been delivered to the appellants.


Bank of Nevis International Limited v. Kucher, 2024 ONCA 240

[Roberts, George and Monahan JJ.A.]

Counsel:

J.P.E. Hardy and R. O’Hare, for the appellant

R. W. Staley, N. J. Shaheen, and M. Kawatra, for the respondents

Keywords: Breach of Contract, Torts, Defamation, Civil Procedure, Private International Law, Jurisdiction, Forum Selection Clauses, forum non conveniens, Novatrax International Inc. v. Hägele Landtechnik GmbH, 2016 ONCA 771, Momentous.ca Corp. v. Canadian American Assn. of Professional Baseball Ltd., 2010 ONCA 722, Haaretz.com v. Goldhar, 2018 SCC 28, Van Breda v. Village Resorts Ltd., 2012 SCC 17

facts:

The appellant, Bank of Nevis International Limited (“BONIL”), is an international bank headquartered in Nevis, a small island in the Caribbean Sea. The respondent, M.K, is BONIL’s former Vice-President of Investments. The other respondent, BNI Holdcorp Ltd. (“BNI”), was incorporated by M.K in order to buy shares in BONIL. In 2019, all of BONIL’s shares were sold to Petrodel Investment Advisors (“Petrodel”), a Nevis corporation owned by M.P, the former CEO and a Director of BONIL.

The dispute between the parties arose from an investment agreement negotiated by M.K and M.P in December 2019. This agreement between BONIL and BNI (and not M.K personally), provided that BNI would purchase shares in BONIL from Petrodel, conditional upon M.K receiving approval from Nevis’ Regulator of International Banking to be a beneficial shareholder.

The agreement included confidentiality provisions, and an exclusive jurisdiction clause (the “Forum Selection Clause”) as follows:

Any disputes arising out of this Investment Agreement will only be heard exclusively in the Courts which exercise jurisdiction in the Federation of St. Kitts and Nevis.

BONIL commenced an action in Ontario against M.K for violating the agreement’s confidentiality provisions and for defamation. The respondents, relying on the above noted Forum Selection Clause, moved to dismiss the action. BONIL argued that the Superior Court of Justice had jurisdiction because M.K had lived and worked in Ontario.

The motion judge allowed the respondents’ jurisdiction motion, determining that BONIL’s action should be heard in Nevis and not Ontario. In the event he was wrong, and the Forum Selection Clause did not apply, the motion judge indicated that he would have relied on the doctrine of forum non conveniens as “many of [the] factors clearly favour[ed] Nevis as the preferable forum and [that] none favour[ed] Ontario.”

issues:
  1. Did the motion judge err in finding that the Forum Selection Clause applied?
  2. Did the motion judge err in his forum non conveniens analysis by assigning insufficient weight to M.K’s connection to Ontario and by assigning too much weight to M.K’s connection to Nevis?
holding:

Appeal dismissed.

reasoning:
  1. No.

There were two aspects to BONIL’s argument that the Forum Selection Clause does not apply. First, it argued that defamation was not a dispute “arising out of” the investment agreement. Second, even if it was, it would not apply to any claims against M.K, who was not a party to the agreement.

After reviewing the allegations in BONIL’s statement of claim, the motion judge concluded that the “broader allegations of defamatory statements were entirely bound up in the dispute over the investment agreement and the alleged breach of its confidentiality provision”. This conclusion was open to the motion judge, for two reasons. First, BONIL’s statement of claim specifically alleged a breach of the agreement’s confidentiality clauses. And second, M.P himself acknowledged that the investment agreement was the “genesis” of some aspects of the action.

There was also no basis to interfere with the motion judge’s conclusion that the Forum Selection Clause applied to M.K. BONIL, in its amended statement of claim, made a concerted effort to tie M.K to BNI, treating them essentially as one and the same. BONIL further alleged that M.K had “complete control” over BNI and asserted that M.K should be held personally liable for BNI’s conduct. The motion judge was entitled to rely on these pleaded facts. Given how the issues are framed by BONIL in its pleadings, the Court saw no way to separate the conduct of M.K. from BNI. Accordingly, and as found by the motion judge, the two could not be severed from each other.

  1. No.

BONIL also failed to identify any reversible error in the motion judge’s assessment of M.K’s connections to Ontario. As the Supreme Court explained in Haaretz.com v. Goldhar, “presumptive connecting factors must not give rise to an irrebuttable presumption of jurisdiction”. While M.K’s former Ontario residence, and the possibility that he committed the alleged tort in Ontario, may serve as presumptive connecting factors as identified in Van Breda v. Village Resorts Ltd, these factors were not determinative in the forum non conveniens analysis. Rather, the analysis emphasizes fairness and efficacy by “adopting a case-by-case approach” to the question of jurisdiction.

The motion judge, during the course of his forum non conveniens analysis, applied the correct legal principles and considered the relevant factors. He thoroughly examined the relationship between the parties and the two jurisdictions in question, Nevis and Ontario. He thoroughly examined the relationship between the parties and the two jurisdictions in question, Nevis and Ontario. He found that the “relative strengths of the parties’ connections to each forum” was a factor that “strongly favour[ed] Nevis” for several reasons, including that M.K was served with the statement of claim in Nevis; no witnesses or evidence were located in Ontario; BNI is incorporated in Nevis; M.K was no longer a resident of Ontario; and there was no basis to conclude that either M.K or BNI had any assets in Ontario.


Varjacic v. Radoja, 2024 ONCA 233

[Miller, Copeland and Gomery JJ.A.]

Counsel:

D. Gouge, for the appellant

J. Samac, for the respondents A.V., D.Z. and N.T.

D.V., acting in person

B.S., acting in person for the respondent N.R.

Keywords: Unincorporated Voluntary Associations, Governance

facts:

The Hamilton branch of the Royal Yugoslav Army Combatants’ Association in Canada was an unincorporated, voluntary organization whose main asset was a 16-acre parcel of land that once served as the centre of an active community. The memberships lapsed as well as the terms of the last members of the board of directors. The gates of the property were locked. Eventually, some former members and directors sought to revive the association. Others disagreed and argued that the land should be sold and the funds applied toward other purposes. Disagreement about the future of the land led to litigation.

The September 1 judgment, which was not appealed, provided a process by which the association could enroll new members, hold an annual general meeting (AGM), and elect a new board of directors. The process was detailed and complex, but it did not suffer from ambiguity, vagueness, or other indeterminacy that could frustrate its application.

Matters did not go as envisioned. The plaintiffs, including the appellant, held an AGM on November 27, 2021 and a slate of directors were elected. However, the respondents disputed the validity of that AGM and held a second AGM on December 4, 2021, at which other directors were elected.

The plaintiffs then brought a motion seeking a declaration that the November AGM was validly held, and the November board was validly elected. The respondents brought a motion seeking the same but with respect to the December AGM and board election.

The motion judge concluded that the proper procedures were not followed by the plaintiffs and refused to grant the declaration that the November AGM and board were valid. The motion judge granted a declaration that the board elected at the December AGM meeting was validly elected. One of the plaintiffs appealed.

issue:

Was the November AGM held in accordance with the September 1 judgment?

holding:

Appeal allowed.

reasoning:

No.

The respondents argued that whether the respondents satisfied the terms of the September 1 judgment was a question of interpretation and that the Court ought to defer to the motion judge’s interpretation of her own order. The Court did not agree with the respondents.

The respondents did not identify any aspect of the September 1 judgment that admits of competing interpretations. Nor could they. The terms of the judgment were clear and did not depend on exercises of judgment or the application of vague criteria. What the respondents argued, essentially, was that the motion judge was entitled to determine what constituted sufficient compliance with the September 1 judgment.

During the motion below, the respondents advised the motion judge that they had complied with the September 1 judgment. They compiled a voluminous motion record that they claimed demonstrated their compliance. The motion judge accepted that the documents were as described by the respondents. But, as the appellant demonstrated on appeal, on closer inspection the documents showed that the respondents fell substantially short of compliance with the September 1 judgment.

The application for membership forms included in the record postdated the AGM, suggesting they were not completed in advance of the AGM as required. Most of the application forms did not indicate that the applicants affirmed that they met the criteria for admission set out in the constitution. There were no membership applications submitted for the respondents themselves, who had purportedly been elected to the board. The provisions for appointing a chair and note-taker, set out in paragraphs 2(e) and (f) of the judgment, were not complied with.

The respondents argued that the motion judge was entitled to determine that, on her interpretation of the September 1 judgment, they had satisfied the terms for holding a valid AGM. The Court disagreed that that was what the motion judge held. The Court was persuaded that the finding was premised on a misapprehension of the evidence and that the order must be set aside.

The appeal was allowed, however, the Court declined to declare either AGM or board to be valid. The Court ordered that a new AGM must be held in accordance with the September 1 judgment for the purpose of electing a board of directors.


Grandfield Homes (Kenton) Ltd. v. Chen, 2024 ONCA 236

[Roberts, George and Monahan JJ.A.]

Counsel:

M. Doyle and S. Jamshidimoghadam, for the appellant

S. Toole, for the respondent

Keywords: Contracts, Real Property, Agreements of Purchase and Sale of Land, Damages, Civil Procedure, Applications, Trial of Issue, Bifurcation, Rules of Civil Procedure, rr. 14.05, 38.04, Rodaro v. Royal Bank of Canada (2002), 59 O.R. (3d) 74, Mihaylov v. 1165996 Ontario Inc., 2017 ONCA 116, Voreon Inc. v. Matas Management Services Inc., 2023 ONCA 745, 1100997 Ontario Limited v. North Elgin Centre Inc., 2016 ONCA 848, Angeloni v. Di Millo v. 2099232 Ontario Inc., 2018 ONCA 1051 Estate of Francesco Angeloni, 2021 ONSC 3084, Primont (Castelmont) Inc. v. Friuli Benevolent Corporation, 2023 ONCA 477

facts:

The proceedings arose from a failed real estate transaction between the parties. On May 5, 2017, the respondent agreed to purchase a home to be built by the appellant for $3,350,000. The respondent paid several deposits totalling $502,500. The closing date was extended twice at the respondent’s request, first until January 14, 2019, and then again until February 20, 2019.

On February 19, 2019, the respondent advised that she was refusing to close the transaction, alleging that the appellant misrepresented the square footage and finishings of the house, which she discovered when viewing the finished house in early February 2019.

The appellant commenced an application to obtain declaratory relief that the respondent breached the agreement of purchase and sale and that it was entitled to retain the deposits paid by the respondent. The application judge found the respondent in breach and ordered that the appellant was entitled to retain the deposits. The application judge declined to grant the order that there be a trial of the issue of damages beyond the forfeited deposits.

issues:
  1. Did the application judge err in finding the appellant’s request for a trial on damages was not sufficiently pleaded?
  2. Did the application judge err in finding that a trial on damages would result in a bifurcation and multiplicity of proceedings?
  3. Did the trial judge err in finding that there would be prejudice to the respondent?
holding:

Appeal dismissed.

reasoning:
  1. No.

The application judge did not make any error in dismissing the appellant’s request for a trial on damages.

The well-established principle is that absent amendment, lawsuits are to be “decided within the boundaries of the pleadings,” and the parties are entitled to have a resolution of their dispute based on the pleadings. The appellant’s claims for a declaration seeking additional damages and an order of a trial of that issue were not specifically pleaded. The appellant never amended its pleadings, either before or at the hearing of the application.

The Court was not persuaded by the appellant’s argument that the application judge failed to consider the unfairness to the appellant in denying its claim for relief. As the appellant had four years to amend its pleadings or file affidavit evidence, but did not do so.

  1. No.

The Court agreed that ordering the trial of the additional damages would result in a bifurcation of the issue of damages, an unnecessary multiplicity of proceedings, and potential prejudice to the respondent.

The appellant did not ask to set aside the application judge’s entire judgment, let alone his order that the deposits were forfeited. As a result, the issue of damages would be bifurcated and could result in inconsistent findings with respect to the quantum of the appellant’s damages.

  1. No.

Allowing the bifurcation of the issue of damages would give rise to an unnecessary multiplicity of proceedings, which would squander scarce judicial resources and prejudice the efficient and due administration of justice.

Moreover, there would be a potential prejudice to the respondent. The respondent was entitled to respond to the case as framed in the appellant’s pleadings and could very well have responded differently had the appellant pleaded its claim for additional damages. A claim for forfeited deposits already paid is different from a claim for the loss of the market value of the subject property.


1284225 Ontario Limited v. Don Valley Business Park Corporation, 2024 ONCA 247

[Roberts, George and Monahan JJ.A.]

Counsel:

B. Radnoff and V. Ford, for the appellants

C. E. Reed, for the respondent

Keywords: Contracts, Interpretation, Civil Procedure, Appeals, Standard of Review, Palpable and Overriding Error, Correctness, Heritage Capital Corp. v. Equitable Trust Co., 2016 SCC 19

facts:

This appeal involved the application judge’s interpretation of s. 4 of the parties’ parking agreement dated May 19, 1972 (“Parking Agreement”), and the calculation of the new parking rate that the appellants should be required to pay to the respondent.

Section 4 of the Parking Agreement provides as follows:

[Appellants] agree[s] to pay parking rates to [respondent] with respect to the parking spaces which [respondent] shall be required to make available to [appellants] from time to time, in accordance with the provisions of this agreement. The rates to be paid by [appellants] to [respondent] for each such parking space, shall be the average of commercial, bona fide, arm’s length parking rates being charged from time to time to the public using parking facilities located within one-half mile from the Project Lands and which parking facilities are serving office buildings.

issue:

Should the application judge’s decision be set aside?

holding:

Appeal allowed.

reasoning:

Yes.

Absent error, the application judge’s interpretation of the parties’ Parking Agreement was owed considerable appellate deference and was reviewable on a standard of “palpable and overriding error”. However, a correctness standard applies if the appeal involves the incorrect application of a legal principle, the failure to consider a required element of a legal test, or the failure to consider a relevant factor.

The Court found that no deference should be owed to the application judge’s decision in this case. The application judge’s analysis proceeded on the basis of the incorrect application of a relevant legal principle. In particular, the application judge found that s. 4 of the Parking Agreement was unambiguous even though fundamental terms material to the calculation of the new parking rate were undefined and unclear. The relevant terms included “commercial, bona fide, arm’s length parking rates” being charged to “the public” using parking facilities “serving office buildings”. A key ambiguity arising from these terms was whether the relevant “parking rates” should be based on hourly, daily, weekly, or monthly rates.

It was also unclear from the terms of s. 4 whether parking facilities used by tenants of an office building could be included within the calculation of average rates or whether such parking facilities should be excluded, notwithstanding the fact that the appellants were themselves tenants of the office building being served by the respondent’s parking lot.

Moreover, notwithstanding his finding that s. 4 of the Parking Agreement was clear and unambiguous, the application judge proceeded to resolve the ambiguities by relying on contested, hearsay evidence offered by the principal of the respondent, which the application judge had found to be inadmissible as expert evidence. The application judge appeared to take judicial notice of the fact that it was “commonly known” that landlords charge tenants a lower parking rate and thus such rates cannot be considered to be “commercial, bona fide, arm’s length” parking rates charged to members of “the public”. In making this finding, the application judge incorrectly relied in part on the lay opinion of the respondent’s affiant who was not independent and, as the application judge acknowledged, could not be treated as an expert.

This caused the application judge to reject out of hand the appellants’ expert evidence that took into account rates charged by landlords to tenants, and to conclude that expert evidence on this issue was unnecessary and irrelevant. This also led him to ignore the fact that the parking rate to be charged to the appellants was a monthly rate, in accordance with the parties’ historical practice. This formed part of the factual matrix that should have been taken into account.

The Court found that as a result of these analytical errors, the application judge’s decision must be set aside and the interpretation of s. 4 of the Parking Agreement be considered afresh.

The Court made the following findings:

  1. The parking rates to be used for the calculation of average rates should be monthly rates for parking in the relevant area.
  2. Given the nature of the neighbourhood comparators, it may very well be that the only comparable commercial monthly rates within the relevant geographic area are those charged by landlords to tenants, whether tenants of the adjacent office buildings or tenants of the parking spaces alone. Section 4 does not exclude those comparators. In the context of the entirety of s. 4, “the public” may include tenants (who are members of the public) or other members of the public. “Public” could be viewed in isolation; it had to be construed in conjunction with the other modifiers in that sentence, in particular, “commercial, bona fide, arm’s length parking rates being charged from time to time to the public using parking facilities…serving office building.” In other words, the appropriate comparators were monthly rates charged to parties who are at “arm’s length” that are “commercial” and “bona fide”, using parking facilities serving office buildings. This could include tenants.
  3. The only admissible evidence regarding monthly rates was provided by the appellants’ expert.
  4. The appellants’ expert calculated the average monthly parking rate for comparable parking lots serving office buildings in the relevant geographic area as $57.22 per stall in December 2019 and $71.36 per stall in April 2022. The appellants’ obligation under s. 4 of the Parking Agreement is to pay the monthly parking rates being charged “from time to time” to users of parking lots in the relevant area. Accordingly, given that the average monthly rate in December 2019 was $57.22 per stall, and the average monthly rate as of April 2022 was $71.36 per stall, these are the rates that the appellants were obliged to pay pursuant to s. 4 of the Parking Agreement.
  5. Since the respondent first requested an updated parking rate on June 1, 2019, the appellants accepted that the updated parking rate should apply from June 1, 2019, onward.

Henry v. Zaitlen, 2024 ONCA 243

[Roberts, Coroza and Gomery JJ.A.]

Counsel:

F. McLaughlin, S. Sugar and C. Windsor, for the appellant

B.A. MacFarlane and M. Hodgins, for the respondent

Keywords: Torts, Negligence, MedMal, Civil Procedure, Jury Trials, McLean v. McCannell, [1937] S.C.R. 341, Stilwell v. World Kitchen Inc., 2014 ONCA 770, Goodwin (Litigation Guardian of) v. Olupona, 2013 ONCA 259, Sacks v. Ross, 2017 ONCA 773, Cheung v. Samra, 2022 ONCA 195,  Gutbir (Litigation guardian of) v. University Health Network, 2012 ONCA 66, El Dali v. Panjalingam, 2013 ONCA 24, Vancouver-Fraser Park District v. Olmstead, [1975] 2 S.C.R. 831, Vancouver-Fraser Park District; Graham v. Hodgkinson (1983), 40 O.R. (2d) 697 (C.A.), Adam v. Campbell (1950), 3 D.L.R. 449 (S.C.C.), Hackman v. Vecchio (1969), 4 D.L.R. (3d) 444 (B.C.C.A.), Lapointe v. Hôpital Le Gardeur, [1992] S.C.R. 351, Ter Neuzen v. Korn, [1995] 3 S.C.R. 674, McLean v. Knox, 2013 ONCA 357, Wade v. C.N.R, [1978] 1 S.C.R. 1064

facts:

This case involves Mr. H.’s medical condition and allegations of negligence against Dr. Z., the neurologist responsible for Mr. H.’s treatment and care. The contention was that Dr. Z failed to properly investigate Mr. H.’s condition despite indications from medical reports and symptoms, leading to a delayed diagnosis of a spinal dural arteriovenous (SDAV) and subsequent paralysis.

On January 27, 2010, Mr. H. attended the emergency room of the Brampton Civic Hospital (the “Hospital”) complaining of lower back pain, numbness down the left leg and pelvic area, and difficulty urinating and voiding. Mr. H. came under the care of Dr. Z., a neurologist. Dr. Z. remained Mr. H.’s primary neurologist, notwithstanding the referral to Dr. B and other medical professionals, including a family doctor.

Mr. H. underwent an MRI of his head and cervical spine on March 14, 2010, the results of which were normal. He underwent a second MRI of his lower spine the next day, which showed the same abnormality of the conus and cauda equina nerve roots seen on the lumbar MRI in late January. Dr. H. S., a radiologist interpreted MRI results from March 15, noting Mr. H. was “not improving” and that his condition remained undiagnosed. Dr. H.S. wrote that “formal imaging of the thoracic spinal cord may also be warranted to exclude abnormality at that level.”

On March 23, 2010, Mr. H. returned to the Hospital’s emergency room reporting numbness in his leg, difficulty walking, and difficulty voiding. After Mr. H. was examined by an ER physician, he was discharged home for continued follow up with Dr. Z.

Dr. Z. received the March 14 and 15 MRI results, a copy of Dr. H.S.’s report, and a copy of the March 23 ER record. He also received the results of a bone scan and gallium scan he had ordered on March 5, both of which were normal. He did not take any steps to contact Mr. H. or have him reattend, nor did he order any further investigations, notably an MRI of Mr. H.’s thoracic (or mid-level) spine.

Mr. H. attended Dr. B.’s office on June 2, 2010. Dr. Z. had provided her with his January and February consultation notes, the January and March MRI results, and the results of the spinal fluid tests. However, he did not provide her with a copy of his March 5 record, or the March 23 ER admission note, or otherwise advise her that Mr. H. had gone to the ER that day with an “acute worsening” of some symptoms.

Mr. H.’s condition continued to deteriorate. On July 20, 2010, Mr. H. returned to the Hospital by ambulance, now in a state of paraplegia. Since Dr. Z. was on vacation, Mr. H. was assessed by another neurologist, Dr. M.A. A SDAV fistula diagnosis was confirmed on July 22. The fistula in Mr. H.’s spine was surgically repaired on July 25, 2010.

Mr. Henry underwent physical therapy and recovered his ability to walk. By late 2021, he still experienced pain, uneven gait, and difficulty with daily activities, requiring ongoing treatment. He was unable to return to work.

Mr. H. and his spouse sued Dr. Z. and others involved in his care in 2012. The action was discontinued or dismissed against all defendants except Dr. Z. by the time a trial took place in November and December 2021 before the trial judge and a jury.

The jury awarded Mr. H. general damages, past income loss, future income loss and future care costs totaling just under $1.5 million. It awarded the Estate of his late wife just over $158,000 in damages for loss of care, guidance and companionship, and for past value of loss of housekeeping and maintenance. The trial judge entered judgment based on this verdict (save for an adjustment of the damages awarded to his late wife’s Estate for past loss of housekeeping and maintenance, which the parties agreed should be reduced), plus pre-judgment interest, subrogated claims, and costs.

issues:
  1. Did the jury err in finding that Z breached the standard of care?
  2. Did the jury’s answer reveal that it did not act judicially?
  3. Did the jury err in making the future damages award that it did?
holding:

Appeal dismissed.

reasoning:
  1. No.

The Court held that a jury could reasonably find that the appellant breached the relevant standard of care, relying on the evidence of the respondents’ expert neurologist, Dr. Y., and rejecting the opinions of the appellant’s neurology experts on the standard of care.

In Dr. Y.’s view, the need for further investigation was heightened after Mr. H. attended the emergency room on March 23 with a worsening of some of his symptoms. Testifying that in the absence of a diagnosis or any explanation for the patient’s symptoms, Dr. Z. should have ordered a thoracic MRI pending the scheduled consultation with Dr. B. In Dr. Y.’s view, Dr. Z. also should have arranged to see Mr. H.

The Court did not agree that Dr. Y’s acknowledgment that it was “hard to ignore” the diagnosis of Mr. H’s SDAV fistula as a confession of hindsight bias. The trial judge instructed the jury to avoid hindsight bias in determining the appropriate standard of care for a general neurologist in Ontario in 2010. The jury was presumed to have heeded this instruction.

In a civil appeal of a jury verdict, an appellate court’s role is not to reweigh the evidence or consider whether most judges would have reached the same conclusion as the jury. There was an evidentiary basis, recognized by the trial judge in his instructions, to conclude that Dr. Z. breached the standard of care. The jury’s verdict was entitled to great deference.

  1. No.

There were two ways to approach the jury’s explanations for its conclusion that Dr. Z. breached the standard of care and caused Mr. H.’s damages. The first way, advocated by the appellant, required that each numbered sentence in the explanation be read independently of the others. This would mean that the jury found that Dr. Z. breached the standard of care in three separate and different ways, each of which independently caused damages to Mr. H. The second approach was to read the jury’s explanations holistically.

The Court held that the jury’s answers should be read holistically, as it provided the answers’ contents, and aligned with the governing interpretative principles, the evidence, the parties’ arguments, and the trial judge’s summary of the evidence and instructions on the law. Read holistically, the jury’s explanation was also consistent with the trial judge’s summary of the evidence in his final instructions.

Read as a whole, the jury’s answers were consistent with the respondents’ theory of the case as articulated in closing argument at trial. Relying on the evidence of Dr. Y., Dr. K., and Dr. L., the respondents’ counsel contended that the jury should find Dr. Z. breached the standard of care. She argued that, but for this breach, Mr. H.’s SDAV fistula would have been detected and diagnosed earlier, with the result that he would have suffered fewer permanent injuries.

The Court held that an appellate court should presume that the jury considered the evidence and heeded the judge’s instructions. If the Court were to accept the appellant’s interpretation of the jury’s answers, it would have to conclude that the jury ignored the trial judge’s summary and instructions, the evidence, and the parties’ arguments in favour of a theory of the case that was not supported, argued, or even referred to during the trial. There was no basis to do so here.

The jury was asked whether the respondents had proved “on a balance of probabilities, that but for the breach of the standard of care, Mr. H.’s injuries would not have occurred”. The jury answered yes. In its explanation, it stated that the breach caused the injuries “because of the delay in diagnosis”, and that, had the SDAV fistula been diagnosed before June 2010, Mr. H. “would have been in a more favourable position for treatment and recovery with likely fewer deficits”. This echoed the respondents’ submissions, in closing argument, on causation: “[W]e say it is likely that Dr. Z.’s actions caused Mr. H’s severe and permanent impairments. Because thoracic imaging would have detected it, it would have led to a timely diagnosis and it likely would have prevented Mr. H’s permanent injuries.”

The jury was not required to explicitly state that the diagnosis was delayed because Dr. Z. did not order thoracic imaging. This was implicit when the jury’s explanation on causation was read together with its explanation on the standard of care, which noted that thoracic imaging had not been done.

Nor was the jury required to state anything further to affirm that the respondents had proven causation on a balance of probabilities, given its “yes” answer to the question set out on the jury sheet. Although it might have been preferable for the jury to use different language in its explanation, the Court did not infer that causation was found based only on a loss of a chance. That would have been contrary to its answer to the main question and to the judge’s instruction, which the jury was presumed to have followed.

  1. No.

These were findings that the jury could reasonably make. There was nothing inconsistent or improper about them. A jury’s verdict is entitled to a high degree of deference on appeal. A verdict should not be set aside if it can be reasonably supported by the evidence. This principle applies to damages awards as well as conclusions on liability.

The jury’s past and future income loss awards were not in conflict, nor were they unsupported by evidence. The trial judge correctly instructed the jury that, to award Mr. H. damages for future income loss, it would have to find a real and substantial risk that he would earn less than he would have, but for the injuries caused by Dr. Z.’s negligence.

The trial judge also made it clear, however, that the jury was free to reach its own conclusions regarding Mr. H.’s ability to return to work and how long he would continue to work given his injuries. As a result, the judge instructed the jury that it could award an amount different than the amount suggested by either economic expert. This instruction was not challenged by the appellant either at trial or on this appeal.


SHORT CIVIL DECISIONS

Grillone (Re), 2024 ONCA 244

[Benotto J.A. (Motions Judge)]

Counsel:

S.G., for the respondent, acting in person (M54911, M54921) and for the moving party byway of cross-motion, acting in person (M54913)

M. Bacal, for the moving party Bluecore Capital Inc. (M54911) and respondent byway of cross-motion (M54913)

S. K. Gfeller, for the respondent by way of cross-motion (M54913) and moving party (M54921) DL

Keywords: [KEYWORDS]

Avedian v. Enbridge Gas Distribution Inc. (Enbridge Gas Distribution), 2024 ONCA 241

[Roberts, George and Monahan JJ.A.]

Counsel:

C. Carter, for the moving parties

J. G. Norton, for the responding parties, Enbridge Gas Distribution Inc. operating as Enbridge Gas Distribution and Lakeside Performance Gas Services Ltd. operating as Lakeside Gas Services

C. K. Boggs, for the responding parties, Alpha Delta Heating Contractor Inc. and ALD

C. I.R. Morrison, for the responding parties, TQB Heating and Air Conditioning Inc. and BB

D. Reiter and P. Copeland, for the responding party, Enbridge Inc.

Keywords: Civil Procedure, Appeals, Stay Pending Appeal, Jurisdiction, Final or Interlocutory, Orders, Variation, RJR-MacDonald Inc. v. Canada (Attorney General), [1995] 3 S.C.R. 199

Hart v. Balice, 2024 ONCA 249

[Paciocco, George and Favreau JJ.A.]

Counsel:

M.H., acting in person

N. Groot, for the respondent

Keywords: Civil Procedure, Appeals, Vexatious Litigants, Courts of Justice Act, R.S.O. 1990, c. C.43, ss 140(1), Rules of Civil Procedure, rr. 2.1.03(1), 59.06(2)(a), 61.16(6.1), Canada Mortgage and Housing Corporation v. Hart, 2023 ONSC 3544, Kallaba v. Bylykbashi (2006), 265 D.L.R. (4th) 320


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