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Good evening.

Below are summaries of the civil decisions released by the Court of Appeal for Ontario this week.

In Gendron v. Doug C. Thompson Ltd. (Thompson Fuels), the Court considered a number of issues, including negligence, the apportionment of liability, the sufficiency of reasons, contractual exclusion clauses, and Pierringer Agreements in the context of an unfortunate and widely covered oil spill into Sturgeon Lake in 2008.
The Court grappled with appeals routes in the context of the Bankruptcy and Insolvency Act (“BIA”) in two decisions this week. In the lengthier decision, Business Development Bank of Canada v. Astoria Organic Matters Ltd., the Court held that the chambers judge did not err in finding that the appropriate appeal route in that case was governed by the BIA rather than the Courts of Justice Act. In a short unreported decision, our very own Eric Golden successfully argued that the opposing party did not have an automatic right of appeal pursuant to s. 193(c) of the BIA, and was required to seek leave.

Other topics covered this week included mortgage enforcement, privacy and freedom of information, and civil contempt.

On another note, my partner, Lea Nebel, and I invite you to our third annual Top Appeals CLE, which has been rescheduled and will now be taking place at the OBA, 20 Toronto Street, Toronto, on Thursday, May 9, 2019. It is a three hour dinner program beginning at 5 PM, which will also be available by live webcast for those who cannot attend in person.

Our first set of panelists, Eliot Kolers, David Thompson and Katherine Di Tomaso, will discuss Gillham v Lake of Bays and Mega International v Yung, and other decisions dealing with discoverability, appropriate means, and discoverability as it relates to claims for contribution and indemnity.

Tim Danson, Mark Wiffen and Peter Downard will discuss Platnick v Bent, Pointes Protection Association and the “Anti-SLAPP Sextet”.

Last, but certainly not least, a panel led by Glenn Chu of the City of Toronto will discuss the high-profile, real-time, high-stakes constitutional litigation that was the City of Toronto v Attorney-General (reduction of wards from 47 to 25).

The full program agenda can be found here. Please join us for what promises to be a very interesting evening.

Have a nice weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email


Table of Contents

Civil Decisions

Business Development Bank of Canada v. Astoria Organic Matters Ltd. , 2019 ONCA 269

Keywords: Bankruptcy and Insolvency, Receiverships, Civil Procedure, Appeals, Jurisdiction, Leave to Appeal, Inherent Jurisdiction, Statutory Interpretation, Constitutional Law, Doctrine of Paramountcy, Courts of Justice Act, R.S.O. 1990, c. C.43, ss. 6 and 101, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, ss. 183(1), 193, 243(1) and 251, Bankruptcy and Insolvency General Rules, C.R.C., c. 368, r. 31(1), Saskatchewan (Attorney General) v. Lemare Lake Logging Ltd., 2015 SCC 53, Canada (Superintendent of Bankruptcy) v. 407 ETR Concession Company Limited, 2012 ONCA 569, Industrial Alliance Insurance and Financial Services Inc. v. Wedgemount Power Limited Partnership, 2018 BCCA 283, Trusts & Guarantee Co. v. Oakwood Clubs (1931), 40 O.W.N. 581 (H.C.J.), Hamilton Wentworth Credit Union Ltd. v. Courtcliffe Parks Ltd. (1995), 23 O.R. (3d) 781 (Gen. Div.), Century Services Inc. v. Canada (Attorney General), 2010 SCC 60, Montréal (City) v. 2952-1366 Québec Inc., 2005 SCC 62, ATCO Gas & Pipelines Ltd. v. Alberta (Energy & Utilities Board), 2006 SCC 4, Kingsway General Insurance Company v. Residential Warranty Co. of Canada Inc. (Trustee of), 2006 ABCA 293

B&M Handelman Investments Limited et al. v Drotos , [unreported]

Keywords: Bankruptcy and Insolvency, Receiverships, Civil Procedure, Appeals, Jurisdiction, Leave to Appeal, Motions for Directions, Bankruptcy and Insolvency Act, R.S.C., 1985, c. B-3, s. 193(c)

Rokhsefat v. 8758603 Canada Corp., 2019 ONCA 273

Keywords: Contracts, Real Property, Mortgages, Notice of Sale under Mortgage, Discharge Statements, Civil Procedure, Jurisdiction, Applications, Findings of Fact, Costs, Assessments, Mortgages Act, RSO 1990, c. M.40 ss. 12, 17 & 43, Interest Act, R.S.C. 1985, c. I-15, Chong & Dadd v. Kaur, 2013 ONSC 6252

Wolseley Canada Inc. v. Neal Traffic Services Limited (National Traffic Services), 2019 ONCA 276

Keywords: Civil Procedure, Contempt, Sentencing, Fresh Evidence, Striking Pleadings

Barker v. Ontario (Information and Privacy Commissioner), 2019 ONCA 275

Keywords: Administrative Law, Privacy, Freedom of Information, Procedural and Natural Justice, Sufficiency of Reasons, Standard of Review, Reasonableness, Dunsmuir v. New Brunswick, 2008 SCC 9, Newfoundland and Labrador Nurses’ Union v. Newfoundland and Labrador (Treasury Board), 2011 SCC 62, Municipal Freedom of Information and Protection of Privacy Act, RSO 1990, c M56

Tozer v Tassone, 2019 ONCA 285

Keywords: Family Law, Separation Agreements, Setting Aside, Grounds, Non-Disclosure, Civil Procedure, Summary Judgment, Family Law Act, R.S.O. 1990, c. F.3, ss. 56(4), Quinn v Epstein Cole LLP, 2009 ONCA 662

Gendron v. Doug C. Thompson Ltd. (Thompson Fuels), 2019 ONCA 293

Keywords: Torts, Negligence, Contributory Negligence, Contracts, Sale of Goods, Exclusion Clauses, Environmental Law, Liability for Spills, Damages, Mitigation, Apportionment of Liability, Set-Off, Civil Procedure, Settlements, Pierringer Agreements, Sufficiency of Reasons, Costs, Environmental Protection Act, R.S.O. 1990, c. E 19, s. 100.1, Fuel Oil, O Reg 213/01, s. 19, Rule 5 of the Sale of Goods Act, RSO 1990, c S.1, Tercon Contractors Ltd. v. British Columbia (Transportation and Highways), Ingels v Tutkaluk Construction, 2000 SCC 12 2010 SCC 4 Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, R v Sheppard, 2002 SCC 26, Ratych v. Bloomer, [1990] 1 SCR 940, Midwest Properties Ltd. v. Thordarson, 2015 ONCA 819, Canadian Natural Resources Ltd. v. Wood Group Mustang (Canada) Inc., 2018 ABCA 305

Paulin v. Keewatin Patricia District School Board , 2019 ONCA 286

Keywords: Real Property, Commercial Leases, Covenants to Insure, Indemnification, Workplace Safety and Insurance Act, 1997, S.O. 1997, c. 16, s. 30(1), Deslaurier Custom Cabinets Inc. v. 1728106 Ontario Inc., 2016 ONCA 246, Madison Developments Ltd. v. Plan Electric Co., (1997) 152 D.L.R. (4th) 653 (C.A.), Orion Interiors Inc. v. State Farm Fire and Casualty Company, 2016 ONCA 164, Cummer-Yonge Investments Ltd. v. Agnew Surpass Shoe Stores Ltd., [1976] 2 S.C.R. 221, Pyrotech Products Ltd. v. Ross Southward Tire Ltd., [1976] 2 S.C.R. 35, T. Eaton Co. v. Smith et al., [1978] 2 S.C.R. 749, Bell Canada v. The Plan Group, 2009 ONCA 548, Lincoln Canada Services LP v. First Gulf Design Build Inc., [2007] O.J. No. 4167 (S.C.), Royal Host Limited Partnership (General partner of) v. 1842259 Ontario Ltd., 2018 ONCA 467, Canada Steamship Lines Ltd. v. R, [1952] UKPC 1

Short Civil Decisions

2256157 Ontario Ltd. v. Fazi , 2019 ONCA 259

Keywords: Appeal Book Endorsement, Appeal Dismissed

8466718 Canada Inc. v. 1779042 Ontario Ltd., 2019 ONCA 278

Keywords: Contracts, Interpretation, Fraudulent Misrepresentation, Negligent Misrepresentation

Celik v. TD Canada Trust,, 2019 ONCA 270

Keywords: Civil Procedure, Limitation Periods

Royal Bank of Canada v. Everest Group Inc.,, 2019 ONCA 287

Keywords: Contracts, Civil Procedure, Summary Judgment

Bondfield Construction Company Limited v. The Globe and Mail Inc., 2019 ONCA 283

Keywords: Torts, Defamation, Libel, Bankruptcy and Insolvency, Civil Procedure, Costs, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 137.1(8)

1303943 Ontario Inc. v. Dajlan Troka (In Trust), 2019 ONCA 280

Keywords: Contracts, Agreements of Purchase and Sale of Land, Remedies, Relief from Forfeiture, Vendors and Purchasers Act, R.S.O. 1990, c. V.2, s. 3

Goyal v. Niagara College of Applied Arts and Technology, 2019 ONCA 263

Keywords: Torts, Negligence, Duty of Care, Proximate Relationship, Damages, Pure Economic Loss

Steven v. DDR Americas Inc., 2019 ONCA 271

Keywords: Employment Law, Wrongful Dismissal

Radio 1540 Ltd. v. Muhammad, 2019 ONCA 279

Keywords: Credibility

Peters v. Chasty, 2019 ONCA 294

Keywords: Torts, Negligence, Peters v. Chasty, 2016 ONSC 4788

Criminal Decisions

R. v. Ochrym , 2019 ONCA 272

Keywords: Criminal Law, Possession for the Purpose of Trafficking, Driving While Disqualified, Sentencing

R. v. Lynn, 2019 ONCA 277

Keywords: Criminal Law, Possession for the Purpose of Trafficking, Sentencing, R. v. Farizeh, [1994] O.J. No. 2624 (C.A.), Controlled Drugs and Substances Act, S.C. 1996, c. 19, s. 10(1)

R. v. James, 2019 ONCA 288

Keywords: Criminal Law, Drug Offences, Firearms Offences, Canadian Charter of Rights and Freedoms, s. 8, s. 24(2), Search and Seizure, Search Warrants, R. v. Morelli, [2010] S.C.R. 253, R. v. Sadikov, [2014] O.J. No. 376, R. v. Grant, 2009 SCC 32, R. v. McGuffie, 2016 ONCA 365, R. v. Rocha, 2012 ONCA 707, R. v. Cote, 2011 SCC 46, R. v. Cole, 2012 SCC 53, R. v. Caslake, [1998] 1 S.C.R. 51

R. v. Abdelnasir, 2019 ONCA 292

Keywords: Criminal Law, Robbery, Identification Evidence

R. v. Chis, 2019 ONCA 289

Keywords: Criminal Law, First Degree Murder, Jury Instructions, R. v. Mendes, 2018 ONCA 354, R. v. Rodgerson, 2015 SCC 38

R. v. Mohenu, 2019 ONCA 291

Keywords: Criminal Law, Fraud, Sentencing, R. v. Bankay, 2010 ONCA 799, R. v. Badhwar, 2011 ONCA 266, R. v. Castro, 2010 ONCA 718, R. v. Mathur, 2017 ONCA 403, R. v. Priest, (1996) 30 O.R. (3d) 538 (C.A.), R. v. Nassri, 2015 ONCA 316, R. v. Thurairajah, 2008 ONCA 91, R. v. Laine, 2015 ONCA 519, R. v. Lacasse, 2015 SCC 64, Criminal Code, R.S.C., 1985, c. C-46, s. 380(1)(a), s. 742.1(c)

R. v. N’Kansah, 2019 ONCA 290

Keywords: Criminal Law, Importing Drugs, Jury Instructions, Evidence, Good Character Evidence, R. v. Pannu, 2015 ONCA 677, R. v. Bryan, 2013 ONCA 97, R. v. Mensah, (2003) 170 O.A.C. 244, R. v. Burnett, 2018 ONCA 790, R. v. Phillips, 2008 ONCA 726, R. v. Elmosri, (1986) 23 C.C.C. (3d) 503 (Ont. C.A.), R. v. Potts, 2018 ONCA 294, R. v. Daley, 2007 SCC 53, R. v. Jacquard, [1997] 1 S.C.R. 314, R. v. Calnen, 2019 SCC 6, R. v. Jaw, 2009 SCC 42, R. v. Speers, 2017 ONCA 333, R. v. Villaroman, 2016 SCC 333, R. v. W.(D.), [1991] 1 S.C.R. 742


CIVIL DECISIONS

Business Development Bank of Canada v. Astoria Organic Matters Ltd., 2019 ONCA 269

[Feldman, Paciocco and Zarnett JJ.A.]

Counsel:

M.L. Solmon, F. Bennett and R. Joshi, for the moving party

S. Graff and M. Spence, for the responding party

Keywords: Bankruptcy and Insolvency, Receiverships, Civil Procedure, Appeals, Jurisdiction, Leave to Appeal, Inherent Jurisdiction, Statutory Interpretation, Constitutional Law, Doctrine of Paramountcy, Courts of Justice Act, R.S.O. 1990, c. C.43, ss. 6 and 101, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, ss. 183(1), 193, 243(1) and 251, Bankruptcy and Insolvency General Rules, C.R.C., c. 368, r. 31(1), Saskatchewan (Attorney General) v. Lemare Lake Logging Ltd., 2015 SCC 53, Canada (Superintendent of Bankruptcy) v. 407 ETR Concession Company Limited, 2012 ONCA 569, Industrial Alliance Insurance and Financial Services Inc. v. Wedgemount Power Limited Partnership, 2018 BCCA 283, Trusts & Guarantee Co. v. Oakwood Clubs (1931), 40 O.W.N. 581 (H.C.J.), Hamilton Wentworth Credit Union Ltd. v. Courtcliffe Parks Ltd. (1995), 23 O.R. (3d) 781 (Gen. Div.), Century Services Inc. v. Canada (Attorney General), 2010 SCC 60, Montréal (City) v. 2952-1366 Québec Inc., 2005 SCC 62, ATCO Gas & Pipelines Ltd. v. Alberta (Energy & Utilities Board), 2006 SCC 4, Kingsway General Insurance Company v. Residential Warranty Co. of Canada Inc. (Trustee of), 2006 ABCA 293

Facts:

Upon the responding party’s insolvency, one of its secured creditors applied for an order under s. 243(1) of the Bankruptcy and Insolvency Act (the “BIA”) and s. 101 of the Courts of Justice Act (the “CJA”) appointing BDO Canada Ltd. as receiver of the responding party (the “Receiver”). The receivership order stated no proceeding or enforcement process could be commenced against the Receiver except with written consent of the Receiver or with leave of the Court.

The Receiver sold assets of the responding party to the moving party under an Asset Purchase Agreement. Shortly thereafter, the moving party complained about the amount of organic waste accumulated inside one of the facilities it had purchased, and the expenses of about $750,000 consequently incurred to clean it up. The moving party claimed the Receiver had breached obligations owed to it and was responsible to compensate the moving party for its expenses. The moving party brought an application for permission to sue the Receiver under the “leave to sue” provision of the receivership order. On May 17, 2018, a Superior Court judge (the “application judge”) dismissed the application, finding that the moving party’s allegations were not supported by evidence disclosing a prima facie case. On November 8, 2018, the application judge refused the moving party’s request to reopen the application to allow the filing of fresh evidence.

The moving party appealed from both decisions. Those appeals were timely if the CJA, under which there is a 30-day limit for commencing an appeal, governed the appeal route. They were late if the BIA, which imposes a 10-day limit, governed. On a motion before a single judge of the Ontario Court of Appeal (the “chambers judge”), the moving party moved for orders a) that its notice of appeal had been properly served and filed under s. 6 of the CJA; b) in the alternative, granting it an extension of time of 19 days in order to appeal under s. 193(c) of the BIA; or c) in the further alternative, granting it an extension of time of 19 days to seek leave to appeal and granting leave to appeal pursuant to s. 193(e) of the BIA. In a separate motion, the moving party moved before the chambers judge for orders a) declaring that the appeal from the application judge’s decision denying leave to introduce fresh evidence was governed by s. 193(c) of the BIA, or in the alternative s. 6 of the CJA, such that leave to appeal was not required; or b) in the alternative, granting leave to appeal pursuant to s. 193(e) of the BIA.

The chambers judge found the BIA governed the moving party’s appeal and dismissed the motions. The reference in the receivership order to the CJA did not have the effect of ousting the BIA as the source of the appellate authority, nor could it as a matter of federal paramountcy. The provisions of the BIA providing for appeals as of right were not applicable to the appeal, and no grounds for granting leave to appeal existed. The chambers judge also held there was no reviewable error in the application judge’s discretionary decision not to admit the moving party’s proposed fresh evidence.

On appeal, the moving party argued that those conclusions were derivative of the chambers judge’s conclusion about which statute governed the appeal route, and argued that the CJA did, meaning the moving party did not require leave to appeal or an extension of time. The moving party submitted that in view of the Supreme Court’s decision in Saskatchewan (Attorney General) v. Lemare Lake Logging Ltd, as long as there was no operational conflict between the provincial and federal law and the provincial law did not frustrate the federal law’s purpose, the provincial law would continue to apply alongside the federal law.

The Receiver argued that the proceedings giving rise to and arising out of the receivership order were BIA proceedings. Parliament had constitutional authority over the procedure in all matters relating to bankruptcy, and since the appeal provisions of the BIA and CJA were in operational conflict, the BIA provisions prevailed. Alternatively, the only way to comply with both schemes was to follow the more restrictive provisions in the BIA appeal route.

Issue:

(1) Did the chambers judge err in determining that the proper appeal route was governed by the BIA?

Holding:

Appeal dismissed.

Reasoning:

(1) No. The Court held that where the order sought to be appealed was made in reliance on jurisdiction under the BIA, the proper appeal route is governed by the BIA. The Superior Court had dismissed the moving party’s request to sue the Receiver in reliance on the “leave to sue” provision in the receivership order. The Court’s authority to include that provision in the receivership order flowed by necessary implication from the statutory power to appoint a receiver under s. 243(1) of the BIA. Although the CJA also provided such authority under s. 101, the Receiver had been appointed under both statutes and the appeal was governed by the BIA as a matter of paramountcy.

The Court stated that determination of the applicable appeal route turned on whether the “leave to sue” provision under which the application judge had exercised authority to dismiss the moving party’s application had been included in the receivership order pursuant to jurisdiction flowing from the BIA. The Court stated that the essential and customary nature of a “leave to sue” provision in court-ordered receiverships informed the analysis of the source of the court’s authority to include it.

Before Parliament amended the BIA in 2009 to include s. 243(1), appointments of receivers under provincial legislation included “leave to sue” provisions. According to the Ontario General Division Court in Hamilton Wentworth Credit Union Ltd. v. Courtcliffe Parks Ltd., the authority to include such a provision stemmed from the court’s inherent jurisdiction and the statutory authority in the CJA to appoint a receiver. The Ontario Court of Appeal found that s. 243(1) of the BIA had been enacted against the backdrop of existing provincial legislation authorizing the appointment of receivers. However, the Supreme Court of Canada had clarified in Century Services Inc. v. Canada (Attorney General) that in the insolvency context, statutory authority is to be considered before inherent jurisdiction, and a finding of statutory authority would make any reference to inherent jurisdiction unnecessary.

In considering s. 243(1) of the BIA, the Court stated that under the modern approach to statutory interpretation the proper understanding of the section’s words in their context and in light of the purpose of the legislation led to the conclusion that Parliament must be taken to have clothed the court with the power to require leave to sue a receiver. Parliament’s purpose in enacting the provision was to eliminate the need for a patchwork of receivers appointed under provincial legislation. It follows that the court’s power to appoint a national receiver under s. 243(1) of the BIA comprehended the power to include essential receivership terms, and the power to include a “leave to sue” provision in a receivership order was necessarily implied.

The Court rejected the moving party’s argument that the fact s. 251 of the BIA specified when a receiver is to be protected from suit contradicted the notion that the BIA authorized a “leave to sue” provision. The Court stated that s. 251 deals with circumstances under which a receiver cannot be sued at all, and does not displace the right of the court to include an essential term in a receivership order requiring court permission for matters falling outside of s. 251. Nor did failure to specifically include receivers in s. 215 support a finding that s. 243(1) did not authorize a “leave to sue” provision. Section 215 of the BIA provides that certain officials cannot be sued without court permission. Contrary to those officials, s. 243(1) receivers are court-appointed and take their powers from the court appointment orders, not the BIA. When appointed under other statutes, they were historically clothed with customary and common terms essential to their appointment, such as the “leave to sue” provision. The BIA power of appointment carried with it the power to impose that type of term.

The Court concluded the moving party had failed to show an error in the underlying premise of the chambers judge’s decisions, namely that the BIA governed the proposed appeals. Although authority grounding the application judge’s refusal to grant leave to sue the Receiver was found in both the BIA and the CJA, federal paramountcy dictated that the BIA appeal provisions governed.

B&M Handelman Investments Limited et al. v Drotos, [unreported]

[Watt J.A.]

Counsel:

R.S. Baldwin, for the appellants

G.M. Sidlofsky, for Pillar Capital Corporation (Cayman)

E. Golden and D.P. Preger, for the Receiver Rosen Goldberg Inc.

M. Poliak, for Money Gate

Keywords: Bankruptcy and Insolvency, Receiverships, Civil Procedure, Appeals, Jurisdiction, Leave to Appeal, Motions for Directions, Bankruptcy and Insolvency Act, R.S.C., 1985, c. B-3, s. 193(c)

Facts:

The Receiver brought a motion for directions following Pillar Capital’s filing of a notice of appeal from a priority order of Justice Dunphy of the Superior Court of Justice. The Receiver’s motion sought, in part, an order declaring that Pillar Capital did not have an automatic right to appeal to the Court of Appeal without first seeking leave. Pillar Capital argued that its appeal did not require leave pursuant to s. 193(c) of the Bankruptcy and Insolvency Act (the “BIA”).

Issue:

(1) Did Pillar Capital have an automatic right of appeal under s. 193(c) of the BIA?

Holding:

Motion granted.

Reasoning:

(1) No, Pillar Capital did not have an automatic right of appeal under s. 193(c) of the BIA, and was required to seek leave to appeal. In the event that Pillar Capital sought leave to appeal, leave would not be granted because the unnecessary bifurcation of the proceedings was not in the interests of justice.

Rokhsefat v. 8758603 Canada Corp., 2019 ONCA 273

[van Rensburg, Hourigan and Huscroft JJ.A]

Counsel:

Z. M. Kaslik, for the appellant

B. Salsberg, for the respondents

Keywords: Contracts, Real Property, Mortgages, Notice of Sale under Mortgage, Discharge Statements, Civil Procedure, Jurisdiction, Applications, Findings of Fact, Costs, Assessments, Mortgages Act, RSO 1990, c. M.40 ss. 12, 17 & 43, Interest Act, R.S.C. 1985, c. I-15, Chong & Dadd v. Kaur, 2013 ONSC 6252

Facts:

The respondents granted a second mortgage on their home to secure a loan from the appellant. The day before the mortgage matured, the respondents received a discharge statement by email which included an amount of $128,604.30 to be paid. The discharge statement was dated a week before the date the email was received and provided that legal enforcement would be commenced after 15 calendar days. It did not state when the 15 days would begin to run. Two days later, the respondents received a registered letter from the appellant’s counsel indicating that the mortgage was in default by reason of failure to pay the amount due on the redemption date. The letter enclosed a Notice of Sale under Mortgage which specified a discharge amount of $153,285.10 and referred to a payment date that was more than a month later. Despite this, the letter demanded payment by the day the letter was dated.

The respondents challenged the amounts claimed by the appellant and the premature notice of sale, and brought an application to the Superior Court seeking an order under s. 12 of the Mortgages Act for a discharge of the mortgage upon payment into court of an amount to be determined by the court, and a declaration that the Notice of Sale was of no force and effect. The application judge considered the affidavit evidence and determined that the amount owing was $144,886.05. He allowed certain expenses claimed by the appellant and disallowed others. He ordered that if the amount due and owing was not paid within 30 days, an interlocutory injunction that had previously been imposed prohibiting enforcement of the mortgage would be lifted. The appellant appealed this seeking an order setting aside the order of the application judge so that a new proceeding could be commenced before an assessment officer under s. 43 of the Mortgages Act.

Issue:

(1) Should the application judge have determined the application?

(2) Should the application judge have directed a trial of the issue because there were disputed facts?

(3) Did the application judge err in his treatment of various contested amounts claimed by the appellant?

Holding:

Appeal dismissed.

Reasoning:

(1) Yes. The application judge had jurisdiction in this case to address all of the issues that were before him. The appellant contended that the procedure under s. 43 of the Mortgages Act before an assessment officer was the only recourse available to the respondents, and that therefore the application judge lacked jurisdiction to determine the issues in dispute The Court rejected this argument, finding that the respondents brought their application in order to challenge the conduct of the appellant and to determine the proper discharge amount.
Because the Notice of Sale followed only two days after the discharge statement and yet demanded payment of an additional sum of nearly $25,000, there was a real question about the legality of a number of the charges. A mortgagee must be able to ascertain, assert, and finally, defend its right to the legal fees in connection with the mortgage debt. The standard charge terms of mortgage agreements are not a “carte blanche” for a mortgagee to incur and charge fees: Chong & Dadd v. Kaur, 2013 ONSC 6252, at paras. 40 and 43.

In the particular circumstances of this case, the respondents’ court application was a justifiable response to the appellant’s unreasonable conduct in refusing to explain the additional charges and its issuance of a premature Notice of Sale. Even if some of what the application judge determined in relation to the dispute about the amount owing for a discharge of the mortgage could have been addressed before an assessment officer, the matter had been determined. The matter was before a justice of the Superior Court who had jurisdiction to deal with it.

(2) No. The Court found no merit in the appellant’s argument that the application judge ought to have directed a trial of the issue because there were disputed facts. The application judge noted that the material filed on the application was not subject to cross-examination, and even though the evidence of each side was diametrically opposed on key issues, the parties maintained that the application could and should be decided on the record before him. In these circumstances, it was appropriate for the application judge to proceed and to make findings on the evidence that was available.

(3) No. The Court rejected the appellant’s argument that the application judge erred in his treatment of the various contested amounts that were claimed by the appellant. Specifically, in disallowing the mortgagee’s claim for a three-month interest penalty, the application judge indicated that he was not satisfied that there was any prepayment penalty payable under this mortgage, either on default or the failure to pay on the maturity date. Contrary to the appellant’s submission, s. 17 of the Mortgages Act does not provide to a mortgagee any unconditional right to claim such a payment based on maturity alone. With respect to the other items in dispute, the application judge allowed for certain amounts claimed by the appellant, including late payment charges, where there was substantiation for such claims and where they did not offend the Mortgages Act or the Interest Act.

Wolseley Canada Inc. v. Neal Traffic Services Limited (National Traffic Services), 2019 ONCA 276

[Simmons, Juriansz and Miller JJ.A.]

Counsel:

N. M. Abramson and R. Barbiero, for the appellants

B. Yellin and K. Carr, for the respondent

Keywords: Civil Procedure, Contempt, Sentencing, Fresh Evidence, Striking Pleadings

Facts:

The respondent commenced an action claiming that: (1) monies it had advanced to the appellants had not been properly disbursed; and (2) the appellants failed to have a proper accounting system to account for funds flowing in and out.

On April 27, 2017, an interim order was made (the “Interim Order”) that required the appellants to: (1) account for certain amounts they had received from the respondent by delivering a comprehensive spreadsheet within 15 days, and corroborating documents within 3 days of any request; (2) disclose related documents to an accounting firm to be appointed by the respondent; and (3) pay any unpaid accounts within 15 days.

In June 2017, the respondent brought a successful motion to have the appellants found in contempt of paragraphs (1) and (2) of the Interim Order. Prior to sentencing, the appellants had sought to introduce fresh evidence in order to show that they had purged their contempt. Their fresh evidence motion was dismissed.

The appellants were sentenced on March 6, 2018. They appealed on the basis that the sentence was imposed based on the mistaken conclusion that they had not purged their contempt.

Issue:

(1) Did the motion judge err in dismissing the fresh evidence motion?

(2) Did the motion judge err in finding that the appellants had not purged their contempt?

(3) In any event, was the sentence disproportionate and therefore unfit?

Holding:

Appeal allowed.

Reasoning:

(1) Yes. The question of whether the appellants had purged their contempt was relevant to, and was likely to impact the issue of sentencing. The fresh evidence dealt with that issue by addressing the appellant’s actions since their previous attendance before the motion judge. Specifically, the appellants deposed that they had fully complied with the Interim Order by December 2017, having supplied all requested documents to PriceWaterhouseCoopers (“PWC”), the firm appointed by the respondent under the Interim Order. These asserted facts would have been before the motion judge had he not erred by striking portions of the appellants’ affidavits that addressed these facts and by dismissing the fresh evidence motion.

(2) Yes. In concluding that the appellants had not purged their contempt, the motion judge cited the appellants’ failure to account for all money in and out, apparently supported by the affidavit of the respondent’s accounting expert, Ms. Patel of PWC. The motion judge mistakenly found her affidavit to be an indication that “PWC was not given all information as ordered”. Ms. Patel deposed that she had not been able to fully reconcile all monies received by the appellants from the respondent with all third-party accounts the appellants were required to pay with those funds.

The court found that Ms. Patel’s affidavit did not contradict the claim in the appellants’ fresh evidence that they had fully complied with the Interim Order. PWC’s inability to reconcile all monies did not in itself demonstrate that the appellants had not produced all documents as required. The declaration that the appellants had not purged their contempt was set aside.

(3) Yes. The order to strike the appellants’ pleadings was disproportionate and therefore set aside. The court reasoned that the Interim Order had required extensive disclosure, and that the appellants had made considerable efforts to comply with it. The fact that the appellants’ former counsel had conceded that their pleading could be struck if they failed to purge their contempt by July 15, 2017 did not alter the court’s finding.

The court also set aside the order that required the appellants to pay PWC’s costs. The Interim Order had required the respondent to pay such costs. The court concluded that the issue of PWC’s fees was a matter for the fixing of costs after trial.

Barker v. Ontario (Information and Privacy Commissioner), 2019 ONCA 275

[Rouleau, van Rensburg and Roberts JJ.A.]

Counsel:

L.H-C. Chen, for the appellant

A. V. Mayeski, for the corporate respondent

M. J. Huberman and A. Fineberg, for the personal respondent

Keywords: Administrative Law, Privacy, Freedom of Information, Procedural and Natural Justice, Sufficiency of Reasons, Standard of Review, Reasonableness, Dunsmuir v. New Brunswick, 2008 SCC 9, Newfoundland and Labrador Nurses’ Union v. Newfoundland and Labrador (Treasury Board), 2011 SCC 62, Municipal Freedom of Information and Protection of Privacy Act, RSO 1990, c M56

Facts:

Media reported that the corporate respondent’s former CFO had a criminal record, leading the corporate respondent to retain KPMG to investigate how he was hired and whether he caused any losses. A journalist requested disclosure of KPMG’s resulting Report (“the Report”) pursuant to the Municipal Freedom of Information and Protection of Privacy Act (“MFIPPA”). The personal respondent opposed disclosure, arguing that her personal information contained in the Report was exempt under s. 14 of MFIPPA. The corporate respondent determined that the entire Report should be disclosed; pursuant to s. 16, a compelling public interest in disclosure predominated, as it would shed light on the corporate respondent’s operations and would accord with MFIPPA’s purpose.

The personal respondent appealed to the Information and Privacy Commissioner of Ontario (“the Commissioner”), who upheld the release. He explained that much of the Report contained the personal respondent’s information, which was supplied with the expectation that it would be treated confidentially. He therefore concluded that disclosure would be an invasion of privacy. However, he determined that there was a compelling public interest in disclosure. The public had an interest in knowing whether there had been a conflict of interest and whether funds had been misappropriated. As her personal information was inextricably linked the conflict of interest issue, he concluded that her privacy must yield to the public interest in disclosure. The Commissioner also considered whether any portions ought to be redacted, but concluded there was a compelling public interest in total disclosure. He determined it was unnecessary to identify which portions of the Report were personal information, noting that the personal respondent did not make any submissions on s. 14. Following the decision, she requested that the Commissioner reconsider.

The personal respondent argued that the Commissioner ought to have identified each portion of the Report that constituted personal information. In her submission, without such explicit identification, he was unable to analyze whether s. 14 was overridden by the interest in disclosure. This, in her view, constituted a fundamental defect in adjudication and a failure to exercise jurisdiction. The Commissioner declined to reconsider, stating that he had specifically considered the purpose of the privacy exemption and whether the public interest in disclosure outweighed it. The Commissioner cautioned that he had specifically considered whether any portions ought to be withheld but found a compelling interest in disclosure of the entire Report. Accordingly, the failure to specify which portions of the record included personal information did not constitute a fundamental defect warranting reconsideration. He stated that the inclusion of such information in the reasons “would have been redundant in light of the application of the public interest override”.

The personal respondent sought judicial review, alleging reviewable errors including the Commissioner’s failure to identify the information that qualified for the s. 14 exemption. The Divisional Court allowed the application, quashed the decisions, and remitted the matter to the Commissioner. In the court’s view, the Commissioner’s reasons did not permit the conclusion that the decisions were reasonable. He was required to identify each piece of information that was exempted from disclosure under s. 14, and then balance each piece of information under s. 16. As his reasons did not contain this detailed analysis, his decisions were therefore unreasonable.

Issue:

(1) Did the Commissioner err in failing to identify and weigh each piece of the personal respondent’s protected information?

(2) Did the Commissioner err in failing to give sufficient weight to the purpose of s. 14 in his s. 16 balancing analysis?

Holding:

Appeal allowed.

Reasoning:

(1) No. The Court began by noting MFIPPA’s purposes and relevant provisions, including its competing interests: the right to access information, and the protection of personal information. Section 14’s prohibition of disclosure was subject to exceptions, one of which dictates that s.14 will not apply “if the disclosure does not constitute an unjustified invasion of personal privacy”. In this case, the parties agreed that the information was exempt from disclosure. However, s. 16 provides an overriding authority to disclose information. The parties agreed that the standard of review was reasonableness, with the Court noting that assessing a decision on a reasonableness standard includes the nature of the statutory task, the evidence, the parties’ submissions, and the process.

First, the Court reviewed the statutory task. Where s. 14 is engaged but there is no s. 16 issue, the Commissioner will apply s. 14 and identify the information that is protected from disclosure. The Commissioner will have to identify each piece of information protected from disclosure, because each will have to be redacted. Therefore, the reasons will set out the Commissioner’s analysis as it relates to the pieces of information to be redacted. Here, the key issue was s. 16’s application. The Court noted that when s. 16 is engaged, additional analysis is required. First, there must be a compelling public interest in disclosure, and second, that interest must clearly outweigh the purpose of the exemption. Here, the two purposes of MFIPPA conflicted. A s.16 analysis involves balancing these competing purposes, with regard to the particular circumstances of the case.

Here, there was no formula for the Commissioner to follow. The level of specificity required will depend on the circumstances, including the nature of the information and the provisions of MFIPPA that are at play. The reasons should be responsive to the issues raised and the parties’ positions. The Court cautioned, however, that this was not meant to suggest that if a party fails to raise an issue, such failure will absolve the Commissioner of his duty to properly apply the statute.

Next, the Court noted that the personal respondent’s submissions provided necessary background to understanding the Commissioner’s reasons. Given that the corporate respondent had acknowledged the exemption under s.14 applied, her submissions made no reference to what parts of the Report contained personal information or which provisions in s. 14 protected that information from disclosure. She focused on KPMG’s assurance of confidentiality prior to her giving an interview and sharing personal information, indicating that she otherwise would not have participated. She also argued that a significant amount of information was already public, and that adequately addressed public interest considerations. Lastly, she made extensive submissions concerning the application of s. 8(2)(c), raising concerns about exposure to civil liability.

The Court reviewed the reasonableness of the Commissioner’s reasons, finding that he considered the different privacy interests at play and the s. 14 factors that supported his findings, while his s. 16 analysis was alive to the potential impact of disclosure on the personal respondent. Accordingly, his approach was reasonable. As a general proposition, the interpretation of s. 16 is “at the heart of the Commissioner’s specialized expertise”. His failure to identify and balance each piece of information did not undermine the reasonableness of his decision. Although a piece-by-piece analysis might sometimes be required, this was not such a case.

(2) No. Notwithstanding the Commissioner’s failure to specify subsections within s. 14(2), the Court denied that this suggested a failure to undertake proper analysis or give proper weight to s. 14. It was apparent that he was alive to legitimate concerns raised by s. 14(2), the possibility of pecuniary harm, and the possibility of unfair reputational damage. With respect to pecuniary harm, she made her submissions based solely on s. 8(2). The Commissioner responded to this concern, explaining that s. 8(2) did not apply. He then incorporated this into his s. 14 analysis. As for potential damage to the personal respondent’s reputation, this concern was addressed by the Commissioner’s acknowledgement that the information was highly sensitive. Further, one of the personal respondent’s submissions on appeal was not raised with the Commissioner, so there was no reason for him to refer to the provisions dealing with these submissions. Lastly, it was open to the personal respondent to address alleged inaccuracies in the Report, but she failed to do so.

Regarding the weight assigned to public interest in disclosure, the Court found that the Commissioner adequately addressed the personal respondent’s concerns. The Court declined to interfere with his reliance on the corporate respondent’s disclosure assessment, with his finding that the Report contained new information that was not publicly available, and with his decision not to redact any information. Given that he indicated that he had considered whether any portion should be redacted, that finding was entitled to deference. Although not determinative, the Commissioner should also have been alive to the possible benefit of disclosure to the record holder. Lastly, the Court found that no error in the Commissioner’s reconsideration decision, since the finding that the Commissioner’s reasons were adequate meant that there was no basis to grant a reconsideration. As the Commissioner noted, the concerns raised by the personal respondent did not demonstrate a “fundamental defect in the adjudication process, or some jurisdictional defect in the decision, in relation to [the] analysis of the mandatory exemption at section 14”.

Tozer v. Tassone, 2019 ONCA 285

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

Counsel:

J.K. Hannaford and M. Solmon, for the appellant

K.H. Nathens, for the respondent

Keywords: Family Law, Separation Agreements, Setting Aside, Grounds, Non-Disclosure, Civil Procedure, Summary Judgment, Family Law Act, R.S.O. 1990, c. F.3, ss. 56(4), Quinn v Epstein Cole LLP, 2009 ONCA 662

Facts:

The appellant, Mr. Tozer, and the respondent, Ms. Tassone, signed a separation agreement (the “Agreement”) in October 2012. Mr. Tozer later brought an application to set aside the Agreement. In June 2018, the motion judge granted summary judgment to Ms. Tassone, enforcing the Agreement.

The motion judge found that the following facts were not in dispute: (i) the Agreement was a full and final settlement of all outstanding claims between the parties; (ii) under the Agreement, Mr. Tozer undertook to pay Ms. Tassone $3,400,000 by December 31, 2015 (this amount was secured by a mortgage (the “Mortgage”) against an asset; (iii) Mr. Tozer had only paid Ms. Tassone $378,491; (iv) Mr. Tozer owed Ms. Tassone $3,121,509 plus interest.

Notably, the summary judgment did not enforce the Mortgage, which was the subject of another proceeding.

Issue:

(1) Did the motion judge make palpable and overriding errors in his findings of fact?

(2) Did the motion judge have jurisdiction to grant summary judgment?

(3) Did the motion judge deny the appellant procedural fairness and natural justice?

Holding:

Appeal dismissed.

Reasoning:

(1) No. The motion judge properly applied section 56(4) of the Family Law Act, R.S.O. 1990, c. F.3, which provides that a court may, on application, set aside a domestic contract or a provision in it:

(a) if a party failed to disclose to the other significant assets, or significant debts or liabilities, existing when the domestic contract was made;

(b) if a party did not understand the nature or consequences of the domestic contract; or

(c) otherwise in accordance with the law of contract.

The appellant argued that the motion judge erred by failing to find that (i) Ms. Tassone had not disclosed all of her assets prior to signing the Agreement, and (ii) there was a genuine issue as to the significance of the assets. The court found that the motion judge correctly considered the appellant’s claim regarding non-disclosure “with great skepticism”. Mr. Tozer himself had failed to disclose the full value of his assets. Therefore, it was “disingenuous” for him to seek to justify setting aside the Agreement because of Ms. Tassone’s non-disclosure.

Courts are reluctant to interfere when parties have purported to conclusively settle their financial issues (see Quinn v Epstein Cole LLP, 2009 ONCA 662, 92 O.R. (3d) 1 at paras. 3-4). The Agreement at issue specifically stated that it was “in full and final satisfaction” of all outstanding claims between the parties and confirmed that the parties “had sufficiently disclosed their income, assets and liabilities existing at separation and the date of this Agreement.” The court concluded that in such circumstances, even if there was non-disclosure, it was not material.

The motion judge also correctly found that there was no evidence to support a finding that Mr. Tozer did not understand the nature or consequences of the Agreement. There was no allegation of duress or other misconduct, and both parties involved were sophisticated and had received independent legal advice.

In all of the circumstances, the motion judge correctly found no basis to exercise his discretion to set aside the Agreement.

(2) Yes. The motion judge correctly articulated the test for summary judgment, and it was open to him to properly conclude that there was no genuine issue requiring a trial.

(3) No.

Gendron v. Doug C. Thompson Ltd. (Thompson Fuels), 2019 ONCA 293

[Hourigan, Miller and Paciocco JJ.A.]

Counsel:

A. Wallrap and D. Cook, for the appellant Thompson Fuels

A. Grant and M. Legault, for the respondent Technical Standards and Safety Authority

M. Forget and E. J. de Man, for the respondent G

Keywords: Torts, Negligence, Contributory Negligence, Contracts, Sale of Goods, Exclusion Clauses, Environmental Law, Liability for Spills, Damages, Mitigation, Apportionment of Liability, Set-Off, Civil Procedure, Settlements, Pierringer Agreements, Sufficiency of Reasons, Costs, Environmental Protection Act, R.S.O. 1990, c. E 19, s. 100.1, Fuel Oil, O Reg 213/01, s. 19, Rule 5 of the Sale of Goods Act, RSO 1990, c S.1, Tercon Contractors Ltd. v. British Columbia (Transportation and Highways), Ingels v Tutkaluk Construction, 2000 SCC 12 2010 SCC 4 Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, R v Sheppard, 2002 SCC 26, Ratych v. Bloomer, [1990] 1 SCR 940, Midwest Properties Ltd. v. Thordarson, 2015 ONCA 819, Canadian Natural Resources Ltd. v. Wood Group Mustang (Canada) Inc., 2018 ABCA 305

Facts:

Thompson Fuels delivered 700 litres of fuel oil to two oil tanks located in the basement of a home owned by G. Almost immediately, oil began to leak from one of the tanks. G discovered the leak approximately one hour after the oil was delivered and spent the night collecting it in Tupperware containers. He thought he had collected all of the leaking oil. He was incorrect.

Hundreds of litres of oil leaked and drained through a crack between the basement wall and the floor. From there, it drained under G’s house, where some of it remained and soaked into the soil. The rest of the oil made its way through a drainage system under the house and into the city’s culvert, which carried it into nearby Sturgeon Lake. Over the next several months, a massive remediation project was undertaken as a consequence of the leak to both the contaminated land in the surrounding area and the damage to Sturgeon Lake. G’s house was demolished as part of the effort to remove contaminated soil.

G sued in negligence against Thompson Fuels, his fuel supplier and service technician, the Technical Standards and Safety Authority (the “TSSA”), which is the administrative authority responsible for regulation and enforcement of fuels in Ontario, and Les Reservoirs D’Acier de Granby Inc. (“Granby”), the manufacturer of the oil tanks.

Granby settled with G shortly after the trial began, entering into a Pierringer agreement which, in return for Granby’s settlement, released Granby from the action and removed the risk that co-defendants might have to pay Granby’s share of damages if Granby could not do so. At the conclusion of a 27-day trial, the trial judge found that Thompson Fuels was negligent for failing to perform inspections and to test the tanks, but that the TSSA was not because the inspection performed after the spill did not breach the duty of care owed to G. He also found that G had been contributorily negligent for failing to maintain his tanks by having them inspected annually, improper introduction of water into the tanks, and failure to promptly report the leak. He apportioned liability as follows: G 60% at fault and Thompson Fuels 40% at fault. Thompson Fuels was ordered to pay G $864,628 in damages and $465,000 in costs. Costs of the trial were also awarded to the TSSA. In a post-trial ruling on several motions, the trial judge held that Thompson Fuels did not have a right of set-off against the amount paid by Granby to G under the Pierringer agreement.

Thompson Fuels and G initiated separate appeals. Thompson Fuels appealed the trial decision, the post-trial ruling, and the costs awards. G appealed the trial decision only. The two appeals were heard together.

Issue:

(1) Did the trial judge err in assessing Thompson Fuels’ liability?

(2) Did the trail judge err in assessing the TSSA’s liability?

(3) Did the trial judge err in finding G contributorily negligent, or in assessing the extent of such negligence?

(4) Did the trial judge err in his apportionment of liability?

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

(6) Did the trial judge fail to provide adequate reasons?

(7) Did the trial judge err in failing to reduce the amount awarded against Thompson Fuels by the amount of the Granby settlement?

(8) Did the trial judge err in dismissing the claim under s. 100.1 of the Environmental Protection Act (“EPA”) for contribution and indemnity against Thompson Fuels?

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

Holding:

Appeal dismissed.

Reasoning:

(1) No. The trial judge did not err in assessing Thompson Fuels’ liability. Thompson Fuels argued that the trial judge made errors of fact or of mixed fact or law pertaining to whether G moved the tanks, whether a comprehensive inspection of the tanks occurred pursuant to Fuel Oil, O Reg 213/01 (the “Regulation”), and other factual issues. The Court found that the trial judge made a series of factual findings and findings of mixed fact and law that were open to him on the evidence.

Next, Thompson Fuels argued that the trial judge made legal errors by failing to (i) properly apply the “elements of negligence” and conduct a proper causation analysis, (ii) exercise his gatekeeper function with respect to opinion evidence given by G’s expert, and (iii) apply a contractual exclusion clause in the customer service agreement signed by G. The Court rejected these submissions, finding that the trial judge’s reasons on the issue of Thompson Fuels’ liability evinced a proper understanding of the principles of negligence, including causation, and were amply supported by the evidence. He also properly exercised his gatekeeper function in admitting expert evidence.

Finally, the trial judge correctly concluded that Thompson Fuels could not avoid liability on the basis of its standard form contract. The trial judge correctly applied Tercon Contractors Ltd. v. British Columbia (Transportation and Highways), 2010 SCC 4 for the correct analytical approach to determining the enforceability of exclusion clauses. The trial judge correctly found that the exclusion clause does not expressly exclude liability for noncompliance under the Regulation. The trial judge correctly found that Thompson Fuels had failed to meet its obligation under the Regulation to carry out a comprehensive inspection. Exclusion clauses are to be strictly construed, and the burden is on the party relying on such a clause to prove that it is applicable in a particular case: Bow Valley Husky (Bermuda) Ltd. v. Saint John Shipbuilding Ltd., [1997] 3 S.C.R. 1210. The Court found that the trial judge had correctly concluded that it would be contrary to public policy to permit a fuel distributor to escape its legal obligation to conduct a comprehensive inspection as a precondition to supplying fuel to a customer.

(2) No. The trial judge did not err in assessing the TSSA’s liability. On appeal, Thompson Fuels and G made essentially the same arguments that they had unsuccessfully asserted at trial. They argued that the trial judge erred by not finding that the TSSA breached its duty of care to G and the public to reasonably inspect the property, monitor for any contamination escaping off site, to issue an order for remediation as required, and to ensure that G took reasonable steps to protect the environment. The Court found that the trial judge was correct in applying Ingels v Tutkaluk Construction, 2000 SCC 12 (“Ingles”) and then concluding that the TSSA owed G no private law duty of care, other than conducting an inspection with reasonable care. As the trial judge noted, neither G nor Thompson Fuels tendered any expert evidence regarding the standard of care of a prudent TSSA inspector. In these circumstances, G and Thompson Fuels failed to meet their onus to establish liability on the part of the TSSA.

(3) No. The trial judge did not err in finding G contributorily negligent or in assessing the extent of such negligence. Both G and Thompson Fuels argued that the trial judge erred in his analysis of contributory negligence. G argued that Thompson Fuels had not raised any issue when servicing the tanks. G also asserted that the trial judge erred in finding that the use of jerry cans to fill the tanks was negligent. The Court found that the trial judge properly found that G failed to take the steps of a reasonably prudent homeowner in the circumstances. Thompson Fuels argued that the trial judge erred in rejecting its argument that G was negligent in failing to disconnect a drainage pipe that connected his house to the city culvert. The Court found that the evidence did not support Thompson Fuels’ argument. The Court also rejected both G’s and Thompson Fuels’ arguments with respect to G’s mitigation efforts. The Court found that the trial judge had properly considered G’s efforts to mitigate, and did not err in finding that G was contributorily negligent for failing to report the leak.

(4) No. The trial judge did not err in his apportionment of liability. Thompson Fuels argued that the portion of liability assigned to G by the trial judge was too low given that G was involved in repeated patterns of negligent conduct. G argued that substantially more fault should be attributed to Thompson Fuels because it failed to comply with its statutory obligations. The Court found that the trial judge had carefully considered the comparative blameworthiness of the parties before correctly concluding that G was responsible for the majority of the loss. The apportionment of damages is a very fact-specific exercise. The trial judge is entitled to significant deference with respect to such findings, per Ingles. There was no basis for appellate interference with the trial judge’s apportionment of liability.

(5) No. The trial judge did not err in his assessment of damages. Thompson Fuels argued that the trial judge erred in his assessment of damages because the evidence at trial indicated that there had been pre-existing contamination on G’s property. The Court found that the trial judge conducted a detailed analysis of the remediation costs both on and off of G’s property. The trial judge had been mindful of the principle that damages should be awarded in a way that best ensures that the environment is returned to its pre-contamination condition, per Midwest Properties Ltd. v. Thordarson, 2015 ONCA 819, at para. 63. The assessment of damages was correct, save for one adjustment. The trial judge erred in awarding damages to pay out a line of credit secured against the property because this was a “betterment”. This figure was included in the estimated cost to replace the home. The Court found that this would put G in a better position than he had been in before the leak. Therefore, damages should be reduced by deducting the line of credit payment.

(6) No. The trial judge did not fail to provide adequate reasons. Thompson Fuels had relied on R v Sheppard, 2002 SCC 26 to argue that the trial judge’s reasons were inadequate. Thomson Fuels stated that trial judges are required to provide reasons that inform the parties, the appellate court, and the public not only of the result of the case, but also shed light on how the judge reached his or her conclusion. The Court commented that inadequacy of reasons has become a boilerplate ground of appeal at the Court of Appeal. This case represented a high-water mark in this trend. The Court found that the trial judge wrote 79 pages of reasons wherein he meticulously considered both the evidence and the legal issues at play. His reasons were logically coherent, thoughtful, and clearly stated. Accordingly, this submission had no merit.

(7) No. The trial judge did not err in failing to reduce the amount awarded against Thompson Fuels by the amount of the Granby settlement. Thompson Fuels argued that the trial judge erred by failing to reduce the amount awarded against it by the amount of the Granby settlement or by failing to reduce the total damages by the settlement amount before applying the allocation of fault. The Court found that the trial judge correctly concluded that there was no double recovery until G had been fully compensated for his loss. This decision was consistent with the policy objectives underlying Pierringer agreements.

To consider the issue of overcompensation in Pierringer agreements, the Court adopted the analytical framework set out by the Alberta Court of Appeal (“ABCA”) in Canadian Natural Resources Ltd. v. Wood Group Mustang (Canada) Inc., 2018 ABCA 305, which was released after the trial judge’s decision. The Court also reviewed American case law that considered set-off in relation to Pierringer Agreements. These American cases indicated that although the liability of a non-settling defendant is limited to its proportionate share of fault, the non-settling defendant generally does not enjoy a further right of set-off against the amount of the settlement. The Court stated that although the rule in Canada is different, Canadian courts have not been indifferent to considerations of encouraging settlements and fairness to the non-settling defendant as seen in cases such as Ratych v. Bloomer, [1990] 1 SCR 940. The Court stated that determining whether the plaintiff has been overcompensated by reason of a partial settlement is not always a simple matter. In any event, courts should encourage settlements. Moreover, a responsible plaintiff who reaches a settlement agreement should not be punished for the fact that they appear to have reached a settlement for an amount greater than what the court ultimately awards.

(8) No. The trial judge did not err in dismissing the EPA, s. 100.1 claim for contribution and indemnity against Thompson Fuels. G argued that the trial judge erred in not finding Thompson Fuels liable for its proportionate share of the amount G was ordered to pay, pursuant to s. 100.1(1) of the EPA, to the City of Kawartha Lakes, which had completed the remediation. Section 100.1 of the EPA gives a municipality the right to issue orders against the “the owner of the pollutant or the person having control of the pollutant” within the meaning of the EPA. The Court found that the trial judge had properly rejected G’s argument that Thompson Fuels was the “owner” of the oil immediately before the leak. In the trial judge’s view, pursuant to s. 19, Rule 5 of the Sale of Goods Act, RSO 1990, c S.1, G became the “owner” of the oil upon delivery, rather than when payment for the oil was processed approximately five hours after delivery. Furthermore, Thompson Fuels was not in control of the pollutant immediately before the spill; it had lost control of the oil upon delivery. Thus, a claim for contribution and indemnity under the EPA was unavailable.

(9) No. The Court found that there was no basis for appellate interference with the trial judge’s costs award. Appellate courts will set aside a costs award on appeal only if the trial judge has made an error in principle or if the costs award is plainly wrong: Hamilton v. Open Window Bakery Ltd., 2004 SCC 9. Having made a woefully inadequate offer to settle, Thompson Fuels could not seriously contend that the trial judge had erred by not reducing costs as a consequence of the offer.

Paulin v. Keewatin Patricia District School Board, 2019 ONCA 286

[Hourigan, Miller and Paciocco JJ.A.]

Counsel:

K. Dearlove, for the appellant

D. Lester, for the respondent
Keywords: Real Property, Commercial Leases, Covenants to Insure, Indemnification, Workplace Safety and Insurance Act, 1997, S.O. 1997, c. 16, s. 30(1), Deslaurier Custom Cabinets Inc. v. 1728106 Ontario Inc., 2016 ONCA 246, Madison Developments Ltd. v. Plan Electric Co., (1997) 152 D.L.R. (4th) 653 (C.A.), Orion Interiors Inc. v. State Farm Fire and Casualty Company, 2016 ONCA 164, Cummer-Yonge Investments Ltd. v. Agnew Surpass Shoe Stores Ltd., [1976] 2 S.C.R. 221, Pyrotech Products Ltd. v. Ross Southward Tire Ltd., [1976] 2 S.C.R. 35, T. Eaton Co. v. Smith et al., [1978] 2 S.C.R. 749, Bell Canada v. The Plan Group, 2009 ONCA 548, Lincoln Canada Services LP v. First Gulf Design Build Inc., [2007] O.J. No. 4167 (S.C.), Royal Host Limited Partnership (General partner of) v. 1842259 Ontario Ltd., 2018 ONCA 467, Canada Steamship Lines Ltd. v. R, [1952] UKPC 1

Facts:

A daycare employee was injured while at work, a daycare classroom operated by the appellant Corporation of the Municipality of Red Lake (“Red Lake”). Red Lake leased the space from Keewatin Patricia District School Board (the “School Board”). The employee brought action against the School Board but not Red Lake for injuries sustained. The School Board added Red Lake to the action by third party claim.

Two summary judgment motions were brought, one by each of the School Board and Red Lake. The School Board argued that pursuant to a lease agreement between the two of them, Red Lake was required to defend and indemnify the School Board for the plaintiff’s injuries. Red Lake argued the opposite: that the lease indemnified Red Lake. Red Lake also moved to strike the School Board’s third party claim.

The motion judge interpreted the lease and found in favour of the School Board, holding that Red Lake had a duty to defend and indemnify the School Board pursuant to the lease, and dismissed Red Lake’s motion to strike the third party claim. In particular, the motion judge found that a particular clause in the lease obliged Red Lake to insure against the risk of bodily injury to persons in the daycare. Furthermore, the lease provided that Red Lake was required to acquire an insurance policy and add the School Board as an “additional insured”.
Red Lake appealed the motion judge’s decision.

Issue:

(1) Did the motion judge err by failing to consider material clauses?

(2) Did the motion judge err in law by permitting insurance policy considerations relating to Red Lake’s obligation to insure to predominate over the insurance covenants?

(3) Did the motion judge err in law by concluding that Red Lake assumed the risk of the School Board’s own negligence in the absence of specific wording in the lease?

Holding:

Appeal dismissed.

Reasoning:

(1) No, the motion judge properly considered material clauses when interpreting the lease.

Red Lake argued that by finding a covenant in the lease obliged Red Lake to insure against the risk of bodily injury (Covenant 1), the motion judge failed to give meaning to the School Board’s covenant in the lease to insure against liability for bodily injuries sustained by third parties (Covenant 2).

The Court of Appeal found that Red Lake’s argument failed because the motion judge gave meaning to both Covenant 1 and Covenant 2. In particular, the motion judge interpreted the lease to provide that Covenant 2 was limited by Covenant 1. The motion judge was correct in finding that the lease obliged the School Board to insure for bodily injury to third parties generally, and obliged Red Lake to insure for particular instances of bodily injury.

(2) No, the motion judge did not permit insurance policy considerations to prevail over the obligations to indemnify under the lease. This is because the obligation for Red Lake to obtain insurance that included the School Board as an additional insured was a term of the lease itself.

(3) No, this argument has no bearing on the outcome of the motion judge’s decision. Red Lake argued that the indemnification wording in the lease was not clear enough to exempt the School Board’s liability from its own negligence. This argument did not apply where the party agreed to insure against the relevant negligence, as Red Lake had done in the lease.

SHORT CIVIL DECISIONS

2256157 Ontario Ltd v Fazi, 2019 ONCA 259

[Lauewers, Benotto and Brown JJ.A]

Counsel:

W. Kaufmann, for the respondent

Keywords: Appeal Book Endorsement, Appeal Dismissed

8466718 Canada Inc. v. 1779042 Ontario Ltd., 2019 ONCA 278

[Simmons, Juriansz and Miller JJ.A]

Counsel:

J.W.L. Griffiths, for the appellant 1447735 Ontario Ltd.

J. Laberge, for the respondent

Keywords: Contracts, Interpretation, Fraudulent Misrepresentation, Negligent Misrepresentation

Celik v TD Canada Trust, 2019 ONCA 270

[Simmons, Juriansz and Miller JJ.A]

Counsel:

J.R. Forget, for the appellant

J. Riewald, for the respondents

Keywords: Civil Procedure, Limitation Periods

Royal Bank of Canada v Everest Group Inc, 2019 ONCA 287

[Lauewers, Pardu and Nordheimer JJ.A]

Counsel:

D. Hamson, for the appellants

R. Moses, for the respondent

Keywords: Contracts, Civil Procedure, Summary Judgment

Bondfield Construction Company Limited v. The Globe and Mail Inc., 2019 ONCA 283

[Doherty, Pardu and Nordheimer JJ.A]

Counsel:

K. O’Brien and K. Sachar, for the appellant

C. Martins and A. MacDonald, for the respondents

Keywords: Torts, Defamation, Libel, Bankruptcy and Insolvency, Civil Procedure, Costs, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 137.1(8)

1303943 Ontario Inc. v. Dajlan Troka (In Trust), 2019 ONCA 280

[Simmons, Juriansz and Miller JJ.A]

Counsel:

M.Z. Tufman and G.A.P. Tufman, for the appellants

M.G. Bawolska and K.L. Denny, for the respondents

Keywords: Contracts, Agreements of Purchase and Sale of Land, Remedies, Relief from Forfeiture, Vendors and Purchasers Act, R.S.O. 1990, c. V.2, s. 3

Goyal v. Niagara College of Applied Arts and Technology, 2019 ONCA 263

[Simmons, Juriansz and Miller JJ.A]

Counsel:

J. Field and D. Jozefacki, for the appellant

N. Hashemi and S. Gans, for the respondent

Keywords: Torts, Negligence, Duty of Care, Proximate Relationship, Damages, Pure Economic Loss

Steven v. DDR Americas Inc., 2019 ONCA 271

[Simmons, Juriansz and Miller JJ.A]

Counsel:

C. Foulon and B. Hassibi, for the appellants

J. Fyshe, for the respondent

Keywords: Employment Law, Wrongful Dismissal

Radio 1540 Ltd. v. Muhammad, 2019 ONCA 279

[Simmons, Juriansz and Miller JJ.A]

Counsel:

C. Cohen, for the appellants

P. Summers, for the respondent

Keywords: Credibility

CRIMINAL DECISIONS

R. v. Ochrym, 2019 ONCA 272

[Feldman, Trotter and Fairburn JJ.A]

Counsel:

J. Zita and M. Huberman, for the appellant

E. Whitford, for the respondent

Keywords: Criminal Law, Possession for the Purpose of Trafficking, Driving While Disqualified, Sentencing

R. v. Lynn, 2019 ONCA 277

[Doherty, Pepall and Trotter JJ.A]

Counsel:

R. Sheppard, for the appellant

J. Mitschele and I. Glasner, for the respondent

Keywords: Criminal Law, Possession for the Purpose of Trafficking, Sentencing, R. v. Farizeh, [1994] O.J. No. 2624 (C.A.), Controlled Drugs and Substances Act, S.C. 1996, c. 19, s. 10(1)

R. v. James, 2019 ONCA 288

[Pardu, Nordheimer and Harvison Young JJ.A]

Counsel:

J. Hanna, for the appellant

S. Hutchison and K. Flanagan, for the respondent

Keywords: Criminal Law, Drug Offences, Firearms Offences, Canadian Charter of Rights and Freedoms, s. 8, s. 24(2), Search and Seizure, Search Warrants, R. v. Morelli, [2010] S.C.R. 253, R. v. Sadikov, [2014] O.J. No. 376, R. v. Grant, 2009 SCC 32, R. v. McGuffie, 2016 ONCA 365, R. v. Rocha, 2012 ONCA 707, R. v. Cote, 2011 SCC 46, R. v. Cole, 2012 SCC 53, R. v. Caslake, [1998] 1 S.C.R. 51

R. v. Abdelnasir, 2019 ONCA 292

[Hoy A.C.J.O., Doherty and Zarnett JJ.A]

Counsel:

P-L. Frechette, for the appellant

K. Farrell, for the respondent

Keywords: Criminal Law, Robbery, Identification Evidence

R. v. Chis, 2019 ONCA 289

[Feldman, Fairburn and Nordheimer JJ.A]

Counsel:

A. Weisberg and M. Psutka, for the appellant

J. Cameron, for the respondent

Keywords: Criminal Law, First Degree Murder, Jury Instructions, R. v. Mendes, 2018 ONCA 354, R. v. Rodgerson, 2015 SCC 38

R. v. Mohenu, 2019 ONCA 291

[Feldman, Fairburn and Nordheimer JJ.A]

Counsel:

B. Vandebeek, for the appellant

M. Goswami, for the respondent

Keywords: Criminal Law, Fraud, Sentencing, R. v. Bankay, 2010 ONCA 799, R. v. Badhwar, 2011 ONCA 266, R. v. Castro, 2010 ONCA 718, R. v. Mathur, 2017 ONCA 403, R. v. Priest, (1996) 30 O.R. (3d) 538 (C.A.), R. v. Nassri, 2015 ONCA 316, R. v. Thurairajah, 2008 ONCA 91, R. v. Laine, 2015 ONCA 519, R. v. Lacasse, 2015 SCC 64, Criminal Code, R.S.C., 1985, c. C-46, s. 380(1)(a), s. 742.1(c)

R. v. N’Kansah, 2019 ONCA 290

[Rouleau, Miller and Fairburn JJ.A]

Counsel:

T. Yuen, for the appellant

T. Gilliam, for the respondent

Keywords: Criminal Law, Importing Drugs, Jury Instructions, Evidence, Good Character Evidence, R. v. Pannu, 2015 ONCA 677, R. v. Bryan, 2013 ONCA 97, R. v. Mensah, (2003) 170 O.A.C. 244, R. v. Burnett, 2018 ONCA 790, R. v. Phillips, 2008 ONCA 726, R. v. Elmosri, (1986) 23 C.C.C. (3d) 503 (Ont. C.A.), R. v. Potts, 2018 ONCA 294, R. v. Daley, 2007 SCC 53, R. v. Jacquard, [1997] 1 S.C.R. 314, R. v. Calnen, 2019 SCC 6, R. v. Jaw, 2009 SCC 42, R. v. Speers, 2017 ONCA 333, R. v. Villaroman, 2016 SCC 333, R. v. W.(D.), [1991] 1 S.C.R. 742

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 | Criminal Decisions

Good evening.

Below are the civil decisions released by the Court of Appeal for Ontario this week.

In Alectra Utilities Corporation v. Solar Power Network Inc, the Court confirmed that where a contract contains an arbitration clause that expressly denies the possibility of appeal from the arbitral award, the arbitrator’s jurisdiction is not limited to findings that are reasonable or correct. In other words, the arbitrator has the right to be wrong, and being wrong does not mean that the arbitrator exceeded their jurisdiction.

In College of Optometrists of Ontario v. Essilor Group Inc, the Court addressed the scope of provincial legislative authority in respect of regulating out-of-province eyewear retailers. In interpreting the relevant statutes and regulations governing optometry and opticianry in Ontario, the Court concluded that Ontario’s regulatory scheme could not apply to out-of-province parties such as the appellant (which was based out of Quebec but was selling eyewear to Ontarians out of BC). The Court found that there was not a sufficient connection between the activity of the vendor and Ontario and set aside the application judge’s decision that had prohibited Essilor from selling eyewear into Ontario. The Court noted that applying the Ontario legislation to out-of-province suppliers would effectively sanction the creation of a monopoly over the importation of prescription eyewear into Ontario from other provinces. Perhaps the Supreme Court will take interest in this case, with its blend of issues of public importance – from the interprovincial sale of goods through ecommerce, to the protection of public health through regulated health professions, to the constitutional issue of the scope of provincial legislative jurisdiction.

Other topics covered this week included summary judgment in a breach of contract case, assessments of solicitors’ accounts, and wilful blindness in the context of a fraud claim.

Wishing everyone a safe and enjoyable weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email


Table of Contents

Civil Decisions

College of Optometrists of Ontario v. Essilor Group Canada Inc., 2019 ONCA 265

Keywords: Commercial Law, Sale of Goods, Regulated Health Professions, Optometrists, Opticians, Constitutional Law, Inter-Provincial Trade and Commerce, Provincial Jurisdiction, Sufficient Connection, Statutory Interpretation, Regulated Health Professions Act, 1991, SO 1991, c 18, Optometry Act, 1991, SO 1991, c. 35, Opticianry Act, 1991, SO 1991, c 34, Health Professions Act, RSBC 1996, c. 183, Optometrists Regulation, BC Reg. 33/2009, Opticians Regulation, BC Reg 118/2010, Unifund Assurance Co. v. Insurance Corp. of British Columbia, 2003 SCC 40, Wadden v. College of Opticians of Ontario, (2001) 207 DLR (4th) 72, (Ont CA)

Herman v. Goldman, Sloan, Nash and Haber LLP, 2019 ONCA 250

Keywords: Contracts, Solicitor and Client, Accounts for Services Rendered, Assessments, Special Circumstances

Wescom Solutions Inc. v. Minetto, 2019 ONCA 251

Keywords: Torts, Fraud, Knowing Receipt, Wilful Blindness, R. v. Malfara (2006), 211 O.A.C. 200 (CA), R. v. Sansregret, [1985] 1 SCR 570

Alectra Utilities Corporation v. Solar Power Network Inc., 2019 ONCA 254

Keywords: Contracts, Interpretation, Arbitration Agreements, Jurisdiction, Arbitration Act, 1991, S.O 1991, C 17, Mexico v. Cargill, Incorporated, 2011 ONCA 622, C.U.P.E. v. N.B. Liquor Corporation, [1979] 2 SCR 227

Vandenberg v. Wilken, 2019 ONCA 262

Keywords: Real Estate, Civil Procedure, Summary Judgment, Hryniak v. Mauldin, 2014 SCC 7, Butera v. Chown, Cairns LLP, 2017 ONCA 783

Crescent Hotels and Resorts Canada Company v. 2465855 Ontario Inc., 291 ONCA 268

Keywords: Contracts, Termination, Breach, Civil Procedure, Summary Judgment, Fact-Finding Powers, Rules of Civil Procedure, Rule 20.04(2.1), Hryniak v Mauldin, 2014 SCC 7, Guarantee Company of North America v Gordon Capital Corp., [1999] 3 SCR 423

Short Civil Decisions

Asghar v. Alon, 2019 ONCA 249

Keywords: Torts, Defamation

Saint Luke Lutheran Church v. McGregor, 2019 ONCA 261

Keywords: Civil Procedure, Capacity to Sue, Standing

Rivers v Waterloo Regional Police Services Board, 2019 ONCA 267

Keywords: Civil Procedure, Striking Pleadings, Jurisdiction, Police Services Act, RSO 1990, c. P.15, Weber v. Ontario Hydro, [1995] 2 S.C.R. 929

Criminal Decisions

R. v. Imona-Russel, 2019 ONCA 252

Keywords: Criminal Law, Aggravated Sexual Assault, Sexual Assault, Assault with a Deadly Weapon, Assault Causing Bodily Harm, Right to a Fair Trial, R. v. Rowbotham, (1998) 25 O.A.C. 321, Rowbotham Application

R. v. Barry, 2019 ONCA 257

Keywords: Criminal Law, Theft, Victim Surcharge, R. v. Boudreault, 2018 SCC 58

R. v. Nurse, 2019 ONCA 260

Keywords: Criminal Law, First Degree Murder, Evidence, Admissibility, Hearsay, Exceptions to Hearsay Rule, Dying Declarations, R. v. Khelawon, 2006 SCC 57, R. v. Badgerow, 2014 ONCA 272, leave to appeal refused, [2014] S.C.C.A. No. 254, Canadian Charter of Rights and Freedoms, s. 24(2)

R. v. Campbell, 2019 ONCA 258

Keywords: Criminal Law, Impaired Driving Causing Death, Criminal Code, s. 255(3), Canadian Charter of Rights and Freedoms, ss. 7 and ss. 8, R. v. Graveline, 2006 SCC 16, R. v. Grant, 2009 SCC 32

R. v. Forrester, 2019 ONCA 255

Keywords: Criminal Law, Drug Trafficking, Evidence, Alibi, Controlled Drugs and Substances Act, S.C. 1996, c. 19, s. 5(1), R. v. Richards, 2017 ONCA 424

R. c. J.P.G., 2019 ONCA 256

Keywords: Droit Criminel, Criminal Law, Exploitation Sexuelle, Sexual Exploitation, Assistance Inefficace d’un avocat, Ineffective Assistance of Counsel, Droits Linguistiques, Language Rights, Code Criminel, Criminal Code, ss 153(1) and 530, Canadian Charter of Rights and Freedoms, Charte canadienne des droits et libertés, s 14, R. c. Beaulac, [1999] 1 R.C.S. 768

G. v. Ontario (Attorney General), 2019 ONCA 264

Keywords: Criminal Law, Sexual Assault, Sex Offender Registry, Defences, Not Criminally Responsible by Reason of Mental Disorder, Christopher’s Law (Sex Offender Registry), 2000, S.O. 2000, c. 1, Sex Offender Information Registration Act, S.C. 2004, c. 10, Canadian Charter of Rights and Freedoms, ss. 7 and ss. 15, R. v. Khawaja, 2012 SCC 69


CIVIL DECISIONS

College of Optometrists of Ontario v. Essilor Group Inc., 2019 ONCA 265

[Juriansz, Brown and Huscroft JJ.A.]

Counsel:

J. Lisus, H. Book and P. Underwood, for the appellant

L. Rothstein, J. Killey, and D. Rosenbluth, for the respondents

Keywords: Commercial Law, Sale of Goods, Regulated Health Professions, Optometrists, Opticians, Constitutional Law, Inter-Provincial Trade and Commerce, Provincial Jurisdiction, Sufficient Connection, Statutory Interpretation, Regulated Health Professions Act, 1991, SO 1991, c 18, Optometry Act, 1991, SO 1991, c. 35, Opticianry Act, 1991, SO 1991, c 34, Health Professions Act, RSBC 1996, c. 183, Optometrists Regulation, BC Reg. 33/2009, Opticians Regulation, BC Reg 118/2010, Unifund Assurance Co. v. Insurance Corp. of British Columbia, 2003 SCC 40, Wadden v. College of Opticians of Ontario, (2001) 207 DLR (4th) 72, (Ont CA)

Facts:

In 2014, the appellant — a company with a Quebec head office and whose online business was conducted in British Columbia — acquired a company that sold contact lenses and eyeglasses online to Ontario customers. Shortly thereafter, the respondents wrote a joint letter to the appellant alleging that it was engaged in unlawful behaviour “by dispensing prescription eyewear through the Internet to Ontario consumers without involving an Ontario-licensed health care provider.” Discussions ensued amongst the parties, but no agreement was reached.

The respondents brought an application alleging the appellant breached s. 27 of the Regulated Health Professions Act, 1991 (“the RHPA”) by accepting orders for prescription eyewear online and shipping eyewear to patients in Ontario. The respondents sought a declaration that the appellant had breached s. 27, and an injunction prohibiting the appellant from engaging in such dispensing “except where the dispensing is performed by a Member [of the respondents] or a Member’s delegate”. The respondents did not file any evidence of specific harm to any of their members, instead relying on the presumption that if a person performs a controlled act in contravention of RHPA s. 27, harm to the public is presumed.

The application judge granted the declaration and injunction, making two key findings. First, he held that “[i]n substance [the appellant is] dispensing eyewear to those who require corrective lenses to assist with less than perfect vision”; and second, with respect to the applicability of provincial legislation to out-of-province defendants (such as the appellant), that a sufficient connection existed between Ontario and the appellant’s conduct to fall within the prohibition contained in s. 27 of the RHPA.

Issues:

(1) Did the application judge err in finding that the appellant performed the “controlled act” of “dispensing” in Ontario within the meaning of the RHPA?

(2) Did the application judge err in finding that a sufficient connection existed between appellant’s provision of eyewear and Ontario so as to bring it within the ambit of the RHPA?

Holding:

Appeal allowed.

REasoning:

(1) No. The Court began by detailing the exact nature of the appellant’s business model. Via the Ontario subsidiary that it acquired in 2013, the appellant’s online retail business was based in British Columbia and operated in accordance with British Columbia laws and regulations. Located in British Columbia were the subsidiary’s head office and management team, its lab, its distribution centre, and its warehouse. Where a customer in Ontario bought prescription eyewear online from the subsidiary, only two steps in the transaction touch upon Ontario: (i) the customer entered the order online from a device in Ontario; and (ii) the appellant’s subsidiary arranged for the delivery of the eyewear to the customer at a location in Ontario.

Next, the Court reviewed the regulatory scheme under which the appellant operated in British Columbia. Prior to 2010, the appellant’s subsidiary (hereafter referred to as “the appellant”) operated afoul of the provincial regulatory scheme, and in fact was prohibited by court order from selling or dispensing contact lenses online to individuals in British Columbia. In 2010, however, the British Columbia government amended the relevant legislation to permit persons who were not registered optometrists and opticians to dispense corrective eye glass lenses and contact lenses, as long as two main conditions were met. Importantly, those regulations specifically defined “dispense” as “design, prepare, fit, adjust, verify or supply”.

First, the person must possess either: a) a copy of a customer’s “authorizing document” for corrective eyeglasses, or a “contact lens record” for contact lenses; or (b) the information in an “authorizing document” or “contact lens record” accompanied by a statement from the customer certifying the existence and accuracy of the “authorizing document” or “contact lens record”. Second, the person dispensing the prescription would be allowed to rely on a prescription written by an optometrist or qualified medical practitioner outside of British Columbia.

The Court then observed that the structure of Ontario’s regulatory scheme was similar to that of British Columbia. Two statutes define the scope of optometry and opticianry: The Optometry Act and the Opticianry Act. The former defines optometry as “the assessment of the eye and vision system and the diagnosis, treatment and prevention of (a) disorders of refraction; (b) sensory and oculomotor disorders and dysfunctions of the eye and vision system; and (c) prescribed diseases”. The latter defines opticianry as “the provision, fitting and adjustment of subnormal vision devices, contact lenses or eye glasses”.

With respect to the RHPA, the Court noted that the concept of a “controlled act” in the RHPA operates to restrict the performance of specific health care acts to members of recognized professional health care bodies or their delegates. Specifically, s. 27 established the proscription against persons who are not members of the respondents from performing a “controlled act”. In contrast to British Columbia, the Ontario regulatory scheme did not define the term “dispense”.

Looking at the case law, the Court noted that in Wadden v. College of Opticians of Ontario it had previously interpreted “dispensing” in the Opticianry Act as meaning the preparation (but not fabrication), adaptation, and delivery of eye glasses. However, the Court cautioned that Wadden was decided before the rise of online purchasing, and accordingly, the Court’s discussion of “dispensing” then did not foresee the possibility of online purchases.

Looking next at the optometrists’ and opticians’ respective standards of practice, the Court noted that for the former, the only step requiring a patient’s personal attendance is the “fitting or adjusting the spectacles to the patient”. Similarly, the latter set of standards mandates that the delivery of the prescription eyewear be done in person. As the Court observed, it was this requirement that was the point of conflict between the parties.

Finally, the Court turned to the application judge’s reasons. First, it rejected the finding that placing an order constituted a “controlled act”, because it is performed by the customer and not the appellant. Since the prohibition in s.27 of the RHPA is directed at health care suppliers and not at customers, this action therefore could not be contrary to the RHPA. Relatedly, however, the Court rejected the appellant’s argument that selling eyewear and contact lens could be distinguished from “dispensing”, since as a matter of common experience, the dispensing of prescription eyewear involves the commercial sale of a product.

Second, the Court agreed with the application judge’s finding that delivery constituted a “controlled act”. Put simply, the transaction would remain incomplete until delivery was made, and the customer/patient would not obtain the benefit of the prescription until received. Thus, the Court upheld the finding that the appellant was performing a “controlled act”, but cautioned that this in itself was not sufficient to demonstrate that the appellant had violated the RHPA.

(2) Yes. The Court noted that this appeal raised the constitutional issue of whether the appellant’s connection to Ontario was sufficient to support the application of Ontario’s regulatory scheme to an out-of-province entity such as the appellant. While initial formulations of the principle of territorial legislative restriction focused on physical presence in a territory, later formulations put more focus on the relationships among the enacting territory, the subject matter of the law, and the person sought to be subjected to its regulation. The Court observed that there is no single standard defining what constitutes a sufficient connection; whether a sufficient connection exists depends largely on context. The territorial limits on the scope of the provincial legislative authority relate to the conduct that the provincial regulator can regulate, in this case the “controlled acts” under the RHPA.

The Court rejected both parties’ arguments regarding the degree of connection necessary to demonstrate a sufficient connection, noting that the Supreme Court’s judgment in Unifund Assurance Co. v. Insurance Corp. of British Columbia requires a qualitative analysis that does not simply look at the number of relevant acts. Reiterating that the application judge incorrectly concluded that an Ontario customer placing an online order constitutes part of a “controlled act”, the Court stressed that the RHPA was not simply legislation to regulate the nature and quality of health care services. As noted, it contained a strongly commercial aspect, and it was this aspect that predominated in respect of the appellant’s connection to Ontario. Relatedly, the application judge incorrectly characterized the 2010 amendments to British Columbia’s regulatory scheme as changing its purpose from protecting health care to enhancing competition and consumer choice; in actual fact, the evidentiary record did not disclose any shift in legislative purpose.

Given the above, and given that the appellant operated out of British Columbia in completing all of the relevant steps (except for delivery) necessary for compliance with the British Columbia regulatory regime (itself largely similar to the Ontario regime), the Court concluded that delivery in and of itself could not establish a sufficient connection upon which to apply the RHPA.

The Court then rejected the respondents’ argument that the appellant’s sole bricks-and-mortar store in Ontario was evidence of a sufficient connection insofar as the physical store funnelled customers into the online store to complete purchases via in-store computers. Noting that the physical stores required being referred to a registered optician before completing a purchase, the Court concluded that the appellant’s in-store regulatory-compliant transactions could establish the sufficient connection required to apply the RHPA.

Next, the Court assessed the respondents’ “sufficient connection by omission” argument, in which the respondents argued that because the British Columbia regulatory regime did not require the appellant to conduct any fitting or adjustment of the delivered product, the appellant ran afoul of the Ontario regime’s requirement for a fitting or adjustment of the delivery product and therefore established a sufficient connection to Ontario. The Court noted that this argument was based on the view that beyond simply asking whether there was a connection between Ontario and the steps the appellant actually performed, the sufficient connection analysis should also take into account the broader health protection purposes of the RHPA.

The Court rejected this argument, finding that it would essentially prohibit Ontarians from purchasing prescription eyewear online from another province, where the supplier has complied with that province’s regulatory regime, unless delivery of the product were channelled through an Ontario optometrist or optician. Applying the constitutional principle of territorial limits on the scope of provincial legislative authority in that way would in effect sanction the creation of a monopoly over the importation of prescription eyewear into Ontario from other provinces.

Lastly, the Court rejected other jurisprudence on which the application judge relied in reaching his decision. Reviewing several decisions briefly in turn, the Court distinguished each decision from the present appeal.

In view of all of the foregoing, the Court therefore concluded that although the appellant’s act of delivering orders to customers within Ontario constituted a “controlled act” under the RHPA, the RHPA did not apply because the mere act of delivery did not establish a sufficient connection between the appellant and Ontario. Rather, the mere act of delivery had primarily a commercial aspect, not a health care one.

Herman v. Goldman, Sloan, Nash and Haber LLP, 2019 ONCA 250

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

Counsel:

J. McReynolds, for the appellants

C. Kellowan, for the respondent

Keywords: Contracts, Solicitor and Client, Accounts for Services Rendered, Assessments, Special Circumstances

Facts:

The appellants were clients of the respondent law firm for a number of years. In early 2017, the appellants sought to assess 33 accounts on the basis that they were dissatisfied with the services provided and that they were overcharged. The appellants asserted that, notwithstanding that their application for assessment was commenced more than 12 months after the accounts were issued, there were special circumstances warranting the assessment because they had only received the accounts in 2016, as a package, together with a letter of demand. They also argued, as additional special circumstances, that they were unsophisticated, that the amount at issue was high, and that they had grown increasingly dissatisfied with the services provided by the respondent.

The application judge rejected the appellants’ arguments and concluded that there were no special circumstances that would justify an assessment of the subject accounts. In particular, she did not accept that they had not received any of accounts until 2016. She also noted that there was no evidence of the appellants having expressed dissatisfaction with the services when they were provided, and that the appellants, who were both lawyers and business people, were sophisticated and would have known to raise issues with the accounts at the time they were rendered.

Issues:

(1) Did the application judge err in rejecting the appellants’ claim that they had not received the respondents’ accounts at the time they were sent?

(2) Did the application judge err in failing to properly consider all of the special circumstances, and in particular the amount of money that was in dispute?

Holding:

Appeal dismissed.

Reasoning:

(1) No. The Court noted that since this was a finding of fact, it therefore could only be reversed based on a palpable and overriding error by the application judge. The Court found no such error.

The application judge explained why she had reached this conclusion. The application judge rejected the appellants’ assertion that because the accounts contained an incomplete New York address, rather than the appellants’ home address, they must not have received them. She accepted that bills sent in 2016 were computer-generated, but that the original bills, which were produced in evidence, were primarily addressed to the appellants’ home address, in some cases to a Toronto business address, and an email address the appellants did not dispute was their own. The application judge concluded that the appellants’ blanket assertion they did not receive any bills sent to their home and email addresses did not have an air of reality.

The Court also disagreed that the application judge based her decision on the sheer volume of accounts. What was relevant was that the appellants denied having received any of the accounts, a position that the application judge found not to be credible in view of the fact that a large number of the original bills were addressed to their home and email addresses.

(2) No.  The Court was satisfied that the application judge considered all of the possible special circumstances, and that her reasons were responsive to the appellants’ arguments.

Wescom Solutions Inc. v. Minetto, 2019 ONCA 251

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

Counsel:

J. Russo and D. Milivojevic, for the appellants

J. Brown and M. Wright, for the respondent

Keywords: Torts, Fraud, Knowing Receipt, Wilful Blindness, R. v. Malfara (2006), 211 O.A.C. 200 (CA), R. v. Sansregret, [1985] 1 SCR 570

Facts:

The personal appellant was sued in relation to purchases of Apple computer products from another defendant at trial, in which it was alleged that he knew or was wilfully blind to the fraudulent means by which the other defendant obtained the products. The total value of the Apple products was $6.2 million. The personal appellant purchased them from the other defendant with cash, generally meeting in parking lots. The other defendant was the accounting manager of the respondent. In January 2011, she began purchasing the products through fraudulent use of the respondent’s corporate credit card. She then sold the products for her own personal gain.

The parties agreed on the issues to be determined at trial, and that agreement was reflected in a court order directing the trial of the following issues: (1) Whether the personal appellant knew or was willfully blind to the fact that he was purchasing stolen goods or goods fraudulently obtained; and (2) If the personal appellant in fact knew or was willfully blind, whether this applied to all the transactions or just transactions after a certain date.

The trial judge considered the nature and development of the sales relationship between the personal appellant and the other defendant. He divided the sales scheme into three temporal phases. The trial judge found the personal appellant was not wilfully blind during Stage 1, was wilfully blind during Stage 2, and had actual knowledge during Stage 3 that the products were stolen goods or were fraudulently obtained. He awarded damages to the respondent, plus interest, for the products purchased by the personal appellant during Stages 2 and 3.

Issues:

(1) Did the trial judge err by applying an objective standard to the appellants’ wilful blindness, rather than a subjective standard?

(2) Did the trial judge err in making credibility findings against the personal appellant?

Holding:

Appeal dismissed.

Reasoning:

(1) No. The Court agreed with the appellants that the trial judge engaged in an objective analysis. Indeed, as part of his wilful blindness analysis, he stated that wilful blindness is made up of two components: a) In circumstances that arouse the suspicions of a reasonable and honest person that are strong or sufficient enough to raise a duty to inquire; and b) Whether someone in that person’s position chooses to remain deliberately ignorant to the knowledge that inquiry would reveal.

The respondent submitted that the objective analysis was appropriate because this was a “knowing receipt” case. It is true that knowing receipt can be proven not only by establishing actual knowledge or wilful blindness, but also by establishing “constructive knowledge” using objective criteria. However, in this case, the agreed issues for the trial judge were whether the personal appellant had actual knowledge or was willfully blind to the fact that he was purchasing stolen goods or goods fraudulently obtained by the other defendant. The trial judge was not asked to consider whether the personal appellant as a reasonable person would have been alerted to a potential breach of trust.

The Court found that the trial judge erred in law in his articulation of the concept of wilful blindness. As stated by the Court in R. v. Malfara, “Where wilful blindness is in issue, the question is not whether the accused should have been suspicious, but whether the accused was in fact suspicious.” In short, a finding of wilful blindness, which has the same elements in criminal and civil proceedings, involves a subjective focus on the workings of a defendant’s mind.

Nevertheless, the Court found that the trial judge did not err in concluding that the personal appellant was wilfully blind. It was clear from his reasons that the trial judge made findings of fact that established on a subjective standard that the personal appellant was wilfully blind. Those findings established that the personal appellant knew that the products were probably stolen or obtained by fraud, but that he made a deliberate choice not to investigate. This conduct met the definition of wilful blindness articulated in R. v. Sansregret, which arises when a “person who has become aware of the need for some inquiry declines to make the inquiry because he does not wish to know the truth.” Therefore, despite the trial judge’s error in defining wilful blindness, the Court rejected this ground of appeal.

(2) No. The Court was not persuaded that the trial judge erred in his credibility analysis. He made adverse credibility findings against the personal appellant during Stages 2 and 3. These findings were well rooted in the evidence, including the fact that the personal appellant asked the other defendant a second time in Stage 2 whether the products were legitimate while they were trading in a much higher volume, and the fact that the personal appellant saw invoices in Stage 3 that showed, among other things, that the respondent was purchasing the products at full retail price.

Alectra Utilities Corporation v. Solar Power Network Inc., 2019 ONCA 254

[Hourigan, Benotto and Huscroft JJ.A.]

Counsel:

S. Bieber and N. Read-Ellis, for the appellant

G. MacKenzie and B. MacKenzie, for the respondent

Keywords: Contracts, Interpretation, Arbitration Agreements, Jurisdiction, Arbitration Act, 1991, S.O 1991, C 17, Mexico v. Cargill, Incorporated, 2011 ONCA 622, C.U.P.E. v. N.B. Liquor Corporation, [1979] 2 SCR 227

Facts:

The parties entered into an agreement (the “Agreement”) in which the respondent was to finance solar power projects. The appellant was to develop and finance the projects. The appellant would apply for contracts from the Ontario government and would earn income by receiving revenue from construction and operational/maintenance services, in addition to a share of residual profits. The parties were awarded several contracts. The respondent offered to purchase the appellant’s interest, but no agreement was reached. The respondent issued a notice, purportedly exercising its discretion to end the Agreement. Delivery of the notice terminated the parties’ relationship, depriving the appellant of the contracts’ value. The appellant invoked the Agreement’s arbitration clause, challenging the respondent’s right to deliver notice and seeking damages for lost profit for alleged breach of contract. The respondent counterclaimed for amounts paid to the appellant.

The arbitrator found that although the respondent could deliver a notice “in its sole discretion” under the Agreement, that discretion had to be exercised in good faith. The respondent could not rely on the allegation that certain conditions precedent could not be satisfied, because it had not fulfilled its obligation to use commercially reasonable efforts to finalize the required documents. The arbitrator also found the respondent to be dishonest in its claim that the economic return was insufficient, as no attempt had been made to calculate the rate of return. Further, the respondent’s assertion that it did not wish to develop the projects was untrue in light of its ongoing negotiations to purchase the appellant’s interest.

The arbitrator rejected the respondent’s argument that the appellant was barred from claiming lost profits as damages. The Agreement required each party to indemnify the other with respect to breaches of covenants, but also provided that the indemnifier shall not be liable for damages for lost profit. The arbitrator found that the appellant’s claim was not for breach of a covenant – it was for improper exercise of the right to issue notice. The arbitrator concluded that he could award lost profits because the resolution process for indemnity claims under the Agreement was separate from the arbitration process, which contemplated the award of damages without regard to the more limited concept of damages that applied in the indemnity claims resolution process.

The appellant brought an application to enforce the arbitrator’s award. The respondent brought an application to set aside the award, relying in particular on s. 46(1)3 of the Arbitration Act, 1991. That subsection provides that a court may set aside an arbitration award if the award deals with a dispute that the arbitration agreement does not cover or contains a decision on a matter that is beyond the scope of the agreement.

The application judge noted that the Agreement provided that there was to be no appeal from the arbitrator’s decision. However, he described the issues raised on the application as jurisdictional and stated that interpretation of the Agreement was necessary in order to resolve them. The application judge considered the standard of review under s. 46(1)3. Although he was inclined to the view that the appropriate standard was reasonableness rather than correctness, he found it unnecessary to determine the matter because he would reach the same decision regardless.

The application judge found that the arbitrator did not exceed his jurisdiction in concluding that the Agreement imposed a duty of good faith on the respondent’s exercise of its discretion to issue a notice. The arbitrator was required to interpret the relevant provision in order to determine whether he had jurisdiction to hear the issue, and his interpretation was correct.

However, the application judge concluded that the arbitrator’s finding that he could award damages for loss of profits was unreasonable because it was based on two unreasonable findings. First, the arbitrator unreasonably found that the limitation on damages in s. 5.3(3) of the Agreement did not limit his authority to award damages set out in s.7.1. Second, the arbitrator unreasonably found that the claim for breach of the duty of good faith was not a breach of a covenant.

Issues:

(1) Did the application judge err by failing to appreciate the distinction between a narrow review on a true question of jurisdiction versus a broader review on the merits?

Holding:

Appeal allowed.

Reasoning:

(1) Yes. The Court began by noting that because the Agreement expressly excluded the possibility of appealing from the arbitrator’s award, the only basis for the respondent to challenge the award was under s. 46(1) of the Arbitration Act, 1991. In particular, the Court noted the applicability of subsection 46(1)3 to this appeal, which stipulates that a court may set aside an arbitral award if “the award deals with a dispute that the arbitration agreement does not cover or contains a decision on a matter that is beyond the scope of the agreement”. In brief, the Court remarked that s. 46(1)3 requires arbitrators to act within the bounds of the authority granted by the agreement pursuant to which they are appointed. Section 46(1)3 is not an alternate appeal route.

Next, the Court remarked upon the difficulty that Canadian courts have faced in identifying jurisdictional questions, due in large part to how elastic the concept of “jurisdiction” is; indeed, this problem manifested in the context of the arbitral award in dispute here. In response to the respondent’s argument that the arbitrator had no jurisdiction to award damages for lost profits because his authority was limited by the terms of Agreement (which precluded liability for such damages), the Court observed that this line of reasoning would mean that any unreasonable or mistaken interpretation of an agreement could be characterized as resulting in an excess or loss of jurisdiction. On this approach, arbitration awards that are not subject to appeal would, nevertheless, be vulnerable to being set aside for jurisdictional error. This, however, is not the law in Ontario.

Turning to the application judge’s decision, the Court found that the application judge ignored the relevant provision of the Agreement that conferred a plenary jurisdiction on the arbitrator. Instead, the application judge took a much narrower view of the arbitrator’s jurisdiction as a result of emphasizing the wrong provisions of the Agreement. This led to the incorrect conclusion that an arbitration award that is not subject to appeal must be set aside because, in essence, the arbitrator had only the jurisdiction to make an award that was reasonable or correct. In fact, as a result of the provision in the Agreement which foreclosed the possibility of an appeal from the arbitral award, it was within the arbitrator’s jurisdiction to make an unreasonable or incorrect award. The arbitrator’s award was therefore enforced.

Vandenberg v. Wilken, 2019 ONCA 262

[Feldman, Pepall and Roberts JJ.A.]

Counsel:

M. A. Polvere, for the appellants

D. J. Kirwin, for the respondents

Keywords: Real Estate, Civil Procedure, Summary Judgment, Hryniak v. Mauldin, 2014 SCC 7, Butera v. Chown, Cairns LLP, 2017 ONCA 783

Facts:

The parties were involved in a failed real estate transaction that the appellants refused to close because of numerous allegations against the respondent purchasers. The respondents brought an action for specific performance of the sale of the appellants’ farm property, alternatively claiming damages for breach of the agreement. The respondents moved for summary judgment enforcing the agreement of purchase and sale and granting specific performance. Following service of the summary judgment motion, the appellants delivered a statement of defence and counterclaim, and issued a third party claim against the real estate agents – who represented both the appellants and the respondents on the transaction – claiming that the agents exerted undue pressure on the appellants and forced them to enter into the agreement, making it unconscionable.

The motion judge granted summary judgment declaring the agreement of purchase and sale valid, but denied the remedy of specific performance and ordered a trial regarding damages. The motion judge made a number of adverse findings of credibility against the appellants with respect to their interactions with the real estate agents. He also determined that the evidence did not “establish any prospect of a finding of an unconscionable transaction”, and “even if a court could find that the agents misrepresented the effect of signing back the counter-offer, the [appellants’] remedy l[ay] against the agents, not the innocent [respondents]”.

Issues:

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

Holding:

Appeal allowed.

Reasoning:

(1) Yes. While the Court recognized that the motion judge was endeavouring to give effect to “the shift in culture” directed by the Supreme Court in Hryniak v. Mauldin, he nevertheless failed to fully to do what was fully required of him.

Specifically, the motion judge failed to consider whether, in granting partial summary judgment, there was a) a risk of duplicative or inconsistent findings at the trial of the counterclaim and third-party claim, and b) whether granting partial summary judgment was advisable in the context of the litigation as a whole. Referencing its prior decision in Butera v Chown, Cairns LLP, the Court observed that “A motion for partial summary judgment should be considered to be a rare procedure that is reserved for an issue or issues that may be readily bifurcated from those in the main action and that may be dealt with expeditiously and in a cost effective manner.”

In this appeal, none of these factors were present. First, the issues were not readily bifurcated, as the appellants’ allegations of unconscionability were inextricably intertwined with (and therefore affected the determination of) the validity of the agreement. Moreover, the motion judge made numerous findings of credibility concerning the appellants and their relationship with their real estate agents that were the core of the counterclaim and third party claim. The motion judge’s findings would either constrain the trial judge or lead to the risk of inconsistent findings at trial.

Further, in the light of the appellants’ assertions of a disability that in part grounded their allegations of unconscionability, it was incumbent on the motion judge to consider whether in those circumstances, oral evidence was required to determine the issues of credibility on which the decision turned. Finally, the motion judge’s order did not result in the issues ultimately being dealt with in an expeditious and cost effective manner: the partial summary judgment did not dispose of the respondents’ damages claim, the counterclaim or the third party claim.

Crescent Hotels and Resorts Canada Company v. 2465855 Ontario Inc., 2019 ONCA 268

[Lauwers, Benotto and Brown JJ.A]

Counsel:

D. Woodfield, M. Karabus and H. Vettyvel, for the appellant

T. Pinos and C. Cohen, for the respondent

Keywords: Contracts, Termination, Breach, Civil Procedure, Summary Judgment, Fact-Finding Powers, Rules of Civil Procedure, Rule 20.04(2.1), Hryniak v Mauldin, 2014 SCC 7, Guarantee Company of North America v Gordon Capital Corp., [1999] 3 SCR 423

Facts:

The appellant (the “Owner”) owned a hotel and entered into a Hotel Management Agreement (the “Agreement”) with the respondent (the “Manager”) for a term of 10 years. One year later, the Owner terminated the Agreement, alleging that they had cause under the Agreement to do so. The Manager brought an action alleging that the Owner lacked cause to terminate the Agreement and was required to pay the Manager an early termination fee. The motion judge granted summary judgment in favour of the Manager.

Issues:

(1) Did the motion judge err in principle by weighing evidence without expressly invoking her evidence-assessment powers?

(2) Did the motion judge err in interpreting the phrase “in any material respect” in the Agreement?

(3) Did the motion judge err by accepting an unsubstantiated hearsay allegation in the Manager’s evidence regarding the temporary appointment of an interim manager?

(4) Did the motion judge err in failing to find the Manager breached the Agreement with respect to the appointment of a permanent general manager?

(5) Did the motion judge err in in failing to find that the Manager breached the budget-preparation provisions of the Agreement?

Holding:

Appeal dismissed.

Reasoning:

(1) No. The motion judge should have acknowledged that she was utilizing her evidence assessment power but this was not an error in principle that would merit appellate intervention. The Owner argued that the motion judge erred in principle because, having stated that she was not exercising her evidence-assessment powers under r. 20.04(2.1) of the Rules of Civil Procedure, she in fact did so by writing in her reasons that she had weighed the evidence contained in the affidavits. The Court stated that under r. 20.04(2.1), in determining whether there is a genuine issue requiring a trial, a judge may exercise several evidence-assessment powers: weighing the evidence; evaluating the credibility of a deponent; and drawing any reasonable inference from the evidence. These powers are presumptively available to a motion judge; they are not exceptional; and they may be exercised provided their use is not against the interests of justice: Hryniak v Mauldin, 2014 SCC 7 at paras. 66 and 67.

The Court found that that where a judge weighs the evidence filed on a summary judgment motion the judge should acknowledge candidly that she is exercising her r. 20.04(2.1) powers and then go on the explain the basis for any resulting findings of fact. The reasons of the motion judge disclose she used these powers and the better course would have been for her to make such an acknowledgment.

(2) Yes. The motion judge misinterpreted the term “in any material respect” in the Agreement, but the Court found that a reading of the motion judge’s reasons as a whole led to the conclusion that the error did not affect her analysis regarding the breaches alleged by the Owner. Section 12.11(a) of the Agreement defined events of default as including the failure of a party to “perform, keep or fulfill a covenant…in any material respect”, and the continuance of such a failure for more than 30 days after receipt of notice was an event of default. The Owner submitted that the motion judge erred in interpreting “in any material respect” in the Agreement as requiring that a breach rise to the level of one that “goes to the root of the contract” in order for the Owner to assert it as an event of default. The motion judge held that material breach was one that is material, substantial and goes to the root of the contract per Guarantee Company of North America v. Gordon Capital Corp., [1999] 3 S.C.R. 423, at para. 44. As applied to the covenants in the Agreement, it would be a breach that deprived the Owner of the entirety of all benefits of the contract or the very thing the parties contracted for.

The Court found that the motion judge’s contractual interpretation analysis ignored the very language of s. 12.11(a)(i) of the Agreement, which contemplated that a party could assert, as an event of default, the failure to perform a covenant, yet the defaulting party could cure the breach upon receipt of a notice of event of default. Breaches capable of being cured under s. 12.11(a)(i) therefore could include ones far less serious than a breach going to the root of the contract. However, after reviewing each of the alleged breaches, the motion judge concluded that the Owner had failed to prove any of the breaches. Since these findings were anchored firmly in the record and in the language of the Agreement, they were free from reversible error.

(3) No. The Court did not accept this ground of appeal. The Owner submitted that the motion judge erred by accepting an unsubstantiated hearsay allegation in the Manager’s evidence that the interim manager of the hotel appointed by the Manager during the first few months of the Agreement was not working in Canada illegally. The Owner alleged that the interim manager did not have the necessary working visa when she was in this position and relied on this as an event of default to terminate the Agreement.

The Court rejected this ground of appeal for two reasons. First, it found that the Owner’s affidavit did not disclose the source of the information supporting her assertion that she learned the interim manager never secured proper Canadian work documentation. In contrast, the Manager’s affidavit disclosed the source of his information that a representative of the Manager would have written to Canadian immigration authorities regarding the interim manager’s temporary employment. Secondly, when the Owner gave notice of default, there was no event of default left to cure because the interim manager’s tenure had ended four months earlier.

(4) No. The Court found that the motion judge’s findings were supported by the record. The Owner submitted that the motion judge erred in failing to find that the Manager breached the Agreement in appointing a general manager who they alleged was unqualified for the position. The Court rejected this, concluding that the motion judge’s finding that it was the Owner’s final decision to hire the general manager was fully supported by the record and clearly showed the Owner approved of the hiring. Secondly, the Owner contended that the Manager failed to fire the general manager in a timely manner, but the Court found that the evidence did not support that assertion. The Manager accepted the Owner’s insistence that the general manager be fired within the 30-day cure period.

(5) No. The Court found no error in the motion judge’s finding that the Owner approved the 2016 budget. On cross-examination, the Owner’s representative clearly admitted that the 2016 budget was ultimately approved. Furthermore, by the terms of the Agreement the Owner could not rely on its own refusal to approve the Plan as an event of default to terminate the Agreement.


SHORT CIVIL DECISIONS

Asghar v. Alon, 2019 ONCA 249

[Lauwers, Brown and Benotto JJ.A.]

Counsel:

S. Asghar, in person

I. MacKinnon, for the respondent

Keywords: Torts, Defamation

Saint Luke Lutheran Church v. McGregor, 2019 ONCA 261

[Lauwers, Benotto and Brown JJ.A.]

Counsel:

P. Ghosh, for the appellant

J. Griffiths, for the respondents

Keywords: Civil Procedure, Capacity to Sue, Standing

Rivers v Waterloo Regional Police Services Board, 2019 ONCA 267

[Simmons, Juriansz and Miller JJ.A.]

Counsel:

R. D. Elliott and H. S. Fairley, for the appellants

E. Mamay and E. S. C. Cheng, for the appellants

J. H. Bennett, for the respondent Waterloo Regional Police Services Board

C. Jones, for the respondent Waterloo Regional Police Association

J. Martin and G. Hawe, for the respondent Waterloo Regional Police Association

Keywords: Civil Procedure, Striking Pleadings, Jurisdiction, Police Services Act, RSO 1990, c. P.15, Weber v. Ontario Hydro, [1995] 2 S.C.R. 929


CRIMINAL DECISIONS

R. v. Imona-Russel, 2019 ONCA 252

[Lauwers, Pardu and Paciocco JJ.A]

Counsel:

W. Imona-Russel, self-represented

L. Paine, for the respondent

Keywords: Criminal Law, Aggravated Sexual Assault, Sexual Assault, Assault with a Deadly Weapon, Assault Causing Bodily Harm, Right to a Fair Trial, R. v. Rowbotham, (1998) 25 O.A.C. 321, Rowbotham Application

R. v. Barry, 2019 ONCA 257

[Hoy A.C.J.O., Doherty and Zarnett JJ.A.]

Counsel:

E. Hilzenrat, for the appellant

C. Suter, for the respondent

Keywords: Criminal Law, Theft, Victim Surcharge, R. v. Boudreault, 2018 SCC 58

R. v. Nurse, 2019 ONCA 260

[Doherty, Brown and Trotter JJ.A.]

Counsel:

C. Verner, for the appellant Marlon Nurse

D. Doucette and A. Furgiuele, for the appellant Darryl Plummer

R. Schwartz and M. Flanagan, for the respondent

Keywords: Criminal Law, First Degree Murder, Evidence, Admissibility, Hearsay, Exceptions to Hearsay Rule, Dying Declarations, R. v. Khelawon, 2006 SCC 57, R. v. Badgerow, 2014 ONCA 272, leave to appeal refused, [2014] S.C.C.A. No. 254, Canadian Charter of Rights and Freedoms, s. 24(2)

R. v. Campbell, 2019 ONCA 258

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

Counsel:

S. Magotiaux, for the appellant

I. B. Kasper, for the respondent

Keywords: Criminal Law, Impaired Driving Causing Death, Criminal Code, s. 255(3), Canadian Charter of Rights and Freedoms, ss. 7 and ss. 8, R. v. Graveline, 2006 SCC 16, R. v. Grant, 2009 SCC 32

R. v. Forrester, 2019 ONCA 255

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

Counsel:

S. Alexander Taraniuk, for the appellant

B. G. Puddington, for the respondent

Keywords: Criminal Law, Drug Trafficking, Evidence, Alibi, Controlled Drugs and Substances Act, S.C. 1996, c. 19, s. 5(1), R. v. Richards, 2017 ONCA 424

R. c. J.P.G., 2019 ONCA 256

[La juge en chef adjointe Hoy, les juges Rouleau et Roberts]

Counsel:

D. Parry, pour l’appelant

P. G. Cowle, pour l’intimée

Keywords: Droit Criminel, Criminal Law, Exploitation Sexuelle, Sexual Exploitation, Assistance Inefficace d’un avocat, Ineffective Assistance of Counsel, Droits Linguistiques, Language Rights, Code Criminel, Criminal Code, ss 153(1) and 530, Canadian Charter of Rights and Freedoms, Charte canadienne des droits et libertés, s 14, R. c. Beaulac, [1999] 1 R.C.S. 768

G. v. Ontario (Attorney General), 2019 ONCA 264

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

Counsel:

M. A. Swadron, S. M. Latimer and J. Weiss, for the appellant

S. Z. Green, for the respondent, Attorney General for Ontario

R. Lee and A. Law, for the respondent, Attorney General for Canada

C. Zwibel and R. De Luca, for the intervener, Canadian Civil Liberties Association

A. Szigeti and Andrew Menchynski, for the intervener, Empowerment Council

E. Dann, for the intervener, Criminal Lawyers Association

Keywords: Criminal Law, Sexual Assault, Sex Offender Registry, Defences, Not Criminally Responsible by Reason of Mental Disorder, Christopher’s Law (Sex Offender Registry), 2000, S.O. 2000, c. 1, Sex Offender Information Registration Act, S.C. 2004, c. 10, Canadian Charter of Rights and Freedoms, ss. 7 and ss. 15, R. v. Khawaja, 2012 SCC 69

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.

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Good afternoon,

It was a quiet week at the Court of Appeal for Ontario.

There were only four substantive civil decisions released. In two of them, the Court continued to provide guidance on the Anti-SLAPP provisions of section 137.1 of the Courts of Justice Act.

In Montour v Beacon Publishing Inc., 2019 ONCA 246, the Court affirmed that a trier of fact may consider presumed damages to reputation flowing from serious allegations, such as allegations involving considerable criminality, notwithstanding the absence of evidence of financial loss.  Serious libel does not always manifest itself in financial losses and it may be difficult for a plaintiff to link reputational harm to financial loss, or to lead testimonial evidence of the actual impact of a particular defamation upon reputation.  Thus, it is appropriate for a court to include presumed damages in the balancing of public interest and harm.

In Levant v Day, 2019 ONCA 244, the Court applied the principles from the Anti-SLAPP sextet in the context of a series of aggressive tweets.

Continue Reading BLANEY’S APPEALS: ONTARIO COURT OF APPEAL SUMMARIES (MARCH 25-29, 2019)