COURT OF APPEAL SUMMARIES (March 13, 2023 – March 17, 2023)

By John Polyzogopoulos on March 18, 2023

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Good afternoon.
Following are this week’s summaries of the Court of Appeal for Ontario for the week of March 13, 2023.

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In Poorkid Investments Inc. v. Ontario (Solicitor General), the Court considered the constitutional validity of s. 17 of the Crown Liability and Proceedings Act, 2019 (“CLPA”), which states that proceedings brought against the Crown that include a claim for misfeasance in public office or bad faith in the exercise of public duties or functions are deemed to be stayed, and leave must be obtained before proceeding with such claims. The Court found that the application judge erred in holding that s. 17 of the CLPA was unconstitutional because it created a barrier to accessing the superior courts. The Court concluded that s. 17 of the CLPA was a valid exercise of provincial lawmaking authority under s. 92(14) of the Constitution Act, 1867, and does not violate s. 96. Although s. 17 of the CLPA made it more difficult to bring proceedings against the Crown, the leave requirement and associated rules established by s. 17 did not affect the core jurisdiction of superior courts, much less infringe it.

In Ontario v. St. Paul Fire and Marine Insurance Company, the appellant, Ontario, appealed an application judge’s decision pertaining to the respondent’s refusal to defend claims against Ontario arising out of a proposed class action concerning persons who were arrested and detained for more than 24 hours prior to receiving a bail hearing. Ontario incurred costs of approximately $300,000 in its defence of the proposed class action before certification was denied. Ontario had two insurance policies with the respondent insurer over two relevant periods of time. The Court upheld the application judge’s finding that the damages claimed were not covered under the first policy, as they were not unexpected and arose out of intentional conduct by the insured. The Court found that the application judge erred in finding that the damages were not covered by the second policy, but in any event dismissed the appeal because the second policy only insured damages above $5,000,000.

In 778938 Ontario Limited v. EllisDon Corporation, the Court considered whether Ontario was the proper forum for the resolution of a claim that had been first brought in Nova Scotia. The Court ultimately found, under the doctrine of forum non conveniens, that Nova Scotia was the clearly more appropriate forum due to the risk of possible inconsistent findings on the same issues. The Court stayed the Ontario action until a determination was made in the Nova Scotia action.

Other topics covered this week included a family law dispute regarding equalization of net family property, the unlawful taking of possession of a mortgaged property by a mortgagee, and a child abduction case where the child was ordered to return to New York.

Wishing everyone a nice weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Ines Ferreira
Blaney McMurtry LLP
416.593.2953 Email

Civil Decisions

Poorkid Investments Inc. v. Ontario (Solicitor General), 2023 ONCA 172

Keywords: Torts, Crown Liability, Misfeasance in Public Office, Nonfeasance, Negligence, Nuisance, Constitutional Law, Judiciary, Rule of Law, Civil Procedure, Leave to Commence Proceeding Against Crown, Constitution Act, 1867 ss. 17, 92.(14) and 96, Crown Liability and Proceedings Act, 2019, S.O. 2019 c. 7, Sch. 17, s.17(2), Comprehensive Ontario Police Services Act, 2019, S.O. 2019, c. 1, Proceedings Against the Crown Act, R.S.O. 1990, c. P.27., ss.17(2)-(7), Courts of Justice Act, R.S.O. 1990, c. C.43, s.140, Rules of Civil Procedure, rr. 2.1.01 and 2.1.02, Trial Lawyers Association of British Columbia v. British Columbia (Attorney General), 2014 SCC 59, [2014] 3 S.C.R. 31, Reference re Residential Tenancies Act, [1981] 1 S.C.R. 714, at p. 728, Reference re Code of Civil Procedure (Que.), art. 35, 2021 SCC 27, MacMillan Bloedel Ltd. v. Simpson, [1995] 4 S.C.R. 725, Reference re Amendments to the Residential Tenancies Act (N.S.), [1996] 1 S.C.R. 186, R. v. J.M., 2021 ONCA 150, Re Manitoba Language Rights, [1985] 1 S.C.R. 721, Reference re Secession of Quebec, [1998] 2 S.C.R. 217, Toronto (City) v. Ontario (Attorney General), 2021 SCC 34, British Columbia v. Imperial Tobacco Canada Ltd., 2005 SCC 49, B.C.G.E.U. v. British Columbia (Attorney General), [1988] 2 S.C.R. 214, Quebec (Attorney General) v. 9147-0732 Québec Inc., 2020 SCC 32, The Inherent Jurisdiction of the Court (1970), 23 Curr. Legal Probs. 23, Kristen Rundle, Revisiting the Rule of Law (New York: Cambridge University Press, 2022), Frederick Schauer, Lon Fuller and the Rule of Law, (2020) University of Virginia School of Law Public Law and Legal Theory Paper Series 2020-46, John Tasioulas, The Rule of Law in Tasioulas, ed., The Cambridge Companion to the Philosophy of Law (Cambridge: Cambridge University Press, 2019), Brian Z. Tamanaha, The History and Elements of the Rule of Law (2012) Sing. J.L.S. 232, The Morality of Law, rev’d edn. (New Haven: Yale University Press, 1969), Natural Law and Natural Rights, 2nd ed. (Oxford: Oxford University Press, 2011), Jeremy Waldron, The Rule of Law as an Essentially Contested Concept (2021) NYU School of Law Public Law and Legal Theory Research Paper Series, Working Paper No. 21-15

Ontario v. St. Paul Fire and Marine Insurance Company, 2023 ONCA 173

Keywords: Torts, Crown Liability, Charter Breaches, Bail, Contracts, Insurance, Interpretation, Coverage, Commercial General Liability Insurance, Duty to Defend, Pleadings Rule, Extrinsic Evidence, Nullification Doctrine, Fortuity Principle, Civil Procedure, Class Proceedings, Canadian Charter of Rights and Freedoms, ss. 11(e), Criminal Code, R.S.C. 1985, c. C-46, s. 503(1), Monenco Ltd. v Commonwealth Insurance Co., 2001 SCC 49, Non-Marine Underwriters, Lloyd’s of London v. Scalera, 2000 SCC 24, Tedford v. TD Insurance Meloche Monnex, 2012 ONCA 429, Nichols v. American Home Assurance Co., [1990] 1 S.C.R. 801, Panasonic Eco Solutions Canada Inc. v. XL Speciality Insurance Company, 2021 ONCA 612, IT Haven Inc. v. Certain Underwriters at Lloyd’s, London, 2022 ONCA 71, Cabell v. The Personal Insurance Company, 2011 ONCA 105, (2011), Consolidated-Bathurst v. Mutual Boiler, [1980] 1 S.C.R. 888, Liberty Mutual Insurance Co. v. Hollinger Inc., 236 D.L.R. (4th) 635 (Ont. C.A.), Ontario Society for the Prevention of Cruelty to Animals v. Sovereign General Insurance Company, 2015 ONCA 702, Craig Brown et al., Insurance Law in Canada, loose-leaf (Toronto: Thomson Reuters Canada Ltd., 2002), Gordon G. Hilliker, Liability Insurance Law in Canada, 7th ed. (Toronto: Butterworths, 2020)

Dieffenbacher v. Dieffenbacher IV, 2023 ONCA 189

Keywords: Family Law, Parenting, Relocation, Child Abduction, Best Interests of the Child, Civil Procedure, Appeals, Stay Pending Appeal, Rules of Civil Procedure, r. 63.02, Convention on the Civil Aspects of International Child Abduction, Can. T.S. 1983 No. 35, Ellis v. Wentzell-Ellis, 2010 ONCA 347, Zafar v. Saiyid, 2017 ONCA 919, Circuit World Corp. v. Lesperance (1997), 33 O.R. (3d) 674 (C.A.), Warren Woods Land Corp. v. 1636891 Ontario Inc., 2012 ONCA 12, International Corona Resources Ltd. v. LAC Minerals Ltd. (1986), 21 C.P.C. (2d) 252 (Ont. C.A.), Longley v. Canada (AG), 2007 ONCA 149, J.P.B. v. C.B., 2016 ONCA 996, Chafin v. Chafin (2012), 133 S.Ct. 1017, Office of the Children’s Lawyer v. Balev, 2018 SCC 16, RJR-MacDonald Inc. v. Canada (AG), [1994] 1 SCR 311

Cronier v. Cusack, 2023 ONCA 178

Keywords: Family Law, Equalization of Net Family Property, Civil Procedure, Financial Disclosure, Evidence, Admissibility, Privilege, Adverse Inferences, Family Law Rules, O.Reg., 114/99, rr. 2(2)-(4), Lesko v. Lesko, 2021 ONCA 369, Hickey v. Hickey, [1999] 2 S.C.R. 518, Sagl v. Sagl, 31 R.F.L. (4th) 405 (Ont. S.C.), Qaraan v. Qaraan, 2012 ONSC 6017, Cong v. Cong, 2007 CanLII 7994 (Ont. S.C.), Colucci v. Colucci, 2021 SCC 24

778938 Ontario Limited v. EllisDon Corporation, 2023 ONCA 182

Keywords: Contracts, Construction, Civil Procedure, Conflict of Laws, Jurisdiction Simplicitor, Real and Substantial Connection, Forum Non Conveniens, Appeals, Standard of Review, Lack of Reasons for Decision, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 134(1)(a), Earl v. McAllister, 2021 ONSC 4050 (Div. Ct.), Club Resorts Ltd. v. Van Breda, 2012 SCC 17, Vale Canada Limited v. Royal & Sun Alliance Insurance Company of Canada, 2022 ONCA 862

Zapfe Holdings Inc. v. 1923159 Ontario Inc., 2023 ONCA 190

Keywords: Contracts, Real Property, Mortgages, Enforcement, Possession, Power of Sale, Hume v. 11534599 Canada Corp., 2022 ONCA 575

Short Civil Decisions

East Elgin Concrete Forming Limited v. 9001522 Canada Limited, 2023 ONCA 175

Keywords: Civil Procedure, Appeals, Jurisdiction, Construction Act, R.S.O. 1990, c. C.30, s. 71(1)

Gallen v. Sutherland, 2023 ONCA 170

Keywords: Civil Procedure, Appeals, Jurisdiction, Orders, Final or Interlocutory, Rules of Civil Procedure, rr. 37.14, 59.06, Elguindy v. Elguindy, 2021 ONCA 708

Forest Hill Fine Homes Inc. v. Heartland Farm Mutual Insurance Co., 2023 ONCA 171

Keywords: Torts, Negligence, Contracts, Insurance, Interpretation, Coverage, Duty to Defend, Property Damage, Civil Procedure, Full Indemnity Costs, Progressive Homes Ltd. v. Lombard General Insurance Co. of Canada, 2010 SCC 33, Godonoaga v. Khatambakhsh (2000), 50 O.R. (3d) 417 (C.A.)

Palmer v. Ioannidis, 2023 ONCA 179

Keywords: Real Property, Gifts, Possessory Title, Adverse Possession, Torts, Trespass

Re/Max Realty Specialists Inc. v. 2452303 Ontario Inc., 2023 ONCA 186

Keywords: [KEYWORDS]

Chahal v. Caledon (Town), 2023 ONCA 188

Keywords: Real Property, Municipal Law, Land Use Planning, Legal Non-conforming Use, Evidence, Admissibility, Hearsay, Planning Act, R.S.O. 1990, c. P.13, s. 34(9)

Bowen v. JC Clark Ltd., 2023 ONCA 181

Keywords: Civil Procedure, Costs, Rules of Civil Procedure, rr. 37.14, 59.06, 61.16(6.1), Trillium Motor World Ltd. v. Cassels Brock & Blackwell LLP, 2017 ONCA 840, Render v. ThyssenKrupp Elevator (Canada) Limited, 2022 ONCA 512, Mullings v. Robertson, 2020 ONCA 369, Liu v. Qiu, 2022 ONCA 544

Sutton v. Sutton, 2023 ONCA 192

Keywords: Family Law, Spousal Support, Civil Procedure, Leave to Appeal to Supreme Court of Canada, Stay Pending Appeal, National or Public Importance, Supreme Court Act, R.S.C. 1985, c. S-26, s. 65.1, BTR Global Opportunity Trading Ltd. v. RBC Dexia Investor Services Trust, 2011 ONCA 620, Livent Inc. v. Deloitte & Touche, 2016 ONCA 395, Iroquois Falls Power Corporation v. Ontario Electricity Financial Corporation, 2016 ONCA 616, Alectra Utilities Corp. v. Solar Power Network Inc., 2019 ONCA 332, Boston v. Boston, 2001 SCC 43, RJR-MacDonald Inc. v. Canada (AG), [1994] 1 S.C.R. 311

KLN Holdings Inc. v. Grant, 2023 ONCA 193

Keywords: Civil Procedure, Orders, Enforcement, Writs of Possession, Stay of Proceedings, Rules of Civil Procedure, r. 63.01, National Bank of Canada v. Guibord, 2021 ONCA 864, RJR-MacDonald Inc. v. Canada (AG), [1994] 1 S.C.R. 311, Pearl Hospitality Inc. v. Ceballos, 2020 ONCA 672, Berlianco Inc. v. Wee Rent It Ltd., [1999] O.J. No. 408]

CIVIL DECISIONS

Poorkid Investments Inc. v. Ontario (Solicitor General), 2023 ONCA 172

[Huscroft, Harvison Young and Sossin JJ.A.]

Counsel:

S.Z. Green and R. Cookson, for the appellants

W.P. Murray, for the respondents

facts:

The respondents, Poorkid Investments Inc., The Coach Pyramids Inc., and BH, were the named representative plaintiffs in a class action brought against the appellants, which included the Crown, the Solicitor General of Ontario, the Ontario Provincial Police (“OPP”) Commissioner, the OPP Chief Superintendent, and an Inspector of the OPP (collectively the “Crown”). They sought damages arising out of the OPP’s response to protests by Indigenous activists in Caledonia, Ontario and pleaded four grounds of liability: misfeasance in public office, nonfeasance, negligence, and nuisance. In essence, the respondents alleged that the appellants failed to carry out their legal duties.

Proceedings brought against the Crown or an officer or employee of the Crown that include a claim for misfeasance in public office or bad faith in the exercise of public duties or functions are deemed to be stayed by operation of s. 17 of the Crown Liability and Proceedings Act, 2019, S.O. 2019 c. 7, Sch. 17 (“CLPA”), and can proceed only with leave of the court. To obtain leave, a plaintiff had to establish that the proceeding was brought in good faith and that there was a reasonable possibility the claim will succeed.

The respondents brought an application seeking a declaration that s. 17 of the CLPA violated s. 96 of the Constitution Act, 1867 and was of no force or effect. The constitutionality of the screening process which included a detailed leave procedure was the question at the heart of this appeal.

The application judge found that the rule of law, which informed a proper interpretation of s. 96, required not simply access to the superior courts but meaningful access, which he described as “ensuring that a litigant’s claim is determined on its merits, including the right to present material evidence”.

Thus, the application judge concluded that s. 17 was unconstitutional because it established a barrier to “meaningful” access to the superior courts, while denying a realistic and effective means of overcoming that barrier by relieving the Crown from being subject to documentary and oral discovery.

The application judge went on to find that the remedies of reading in, reading down, or severance were not appropriate because it could not be assumed that the Legislature would have passed the tailored provision, and there was no basis to determine the specifics of a discovery mechanism. He concluded that the appropriate remedy was to issue a declaration that s. 17 is of no force or effect, leaving it to the Legislature to enact a new, constitutionally compliant provision should it wish to do so.

issue:

Did the application judge err in finding that s.17 violates s.96 of the Constitution Act, 1867?

holding:

Appeal allowed.

reasoning:

Yes.

The Court first held that the application judge erred at the outset of his analysis by characterizing s. 17 of the CLPA as establishing a “barrier” to accessing the superior courts. Nothing in s. 17 bars, denies, or otherwise prevents access to the superior courts and their core function of adjudicating disputes. The Court noted that s. 17 establishes a screening process – a procedure that allows the superior courts to screen out unmeritorious claims. The operation of the screening process was determined by the superior courts themselves: they determined whether or not a claim may proceed based on their interpretation and application of the criteria set out in s. 17. In other words, the superior courts continued to exercise their core jurisdiction – hearing and resolving disputes.

The Court then reasoned that there was no evidentiary basis to support the conclusion that prohibiting documentary and oral discovery in the screening process deprived individuals of access to the superior courts. The Court noted that while there was nothing inappropriate about citing academic legal scholarship and much to be gained when it comes to better understanding legal concepts that may be relevant to judicial reasoning, whether academic commentary or scholarship purports simply to describe the law or to explain it, it is not properly the subject of judicial notice – that is, it cannot be accepted as fact without proof.

The Court then held that the leave requirements did not infringe the core jurisdiction of the superior courts. Section 17 of the CLPA did not interfere with the constitutional role of the superior courts. That some – perhaps even many – claimants will be denied leave to bring proceedings as a result of the screening mechanism did not mean that the constitutional role of the superior courts had been impermissibly infringed. Claimants will be denied leave to bring proceedings only after they have had access to the superior courts and failed to satisfy the courts as to the strength of their case. Whether it is considered good or bad policy to screen particular tort claims against the Crown is irrelevant; so long as the legislation does not prevent the superior courts from exercising their core jurisdiction, it does not impermissibly infringe s. 96 of the Constitution Act, 1867.

In short, s. 96 immunized neither the substantive content of the law nor the procedure governing litigation against legislative reform: the Legislature may establish, amend, or repeal causes of action, and may establish various procedural requirements. Section 96 protects the core jurisdiction of the superior courts, but procedural requirements that must be met before particular claims may be brought cannot be equated with depriving the superior courts of the ability to hear disputes and so preventing them from fulfilling their constitutional role – especially given that the superior courts will determine whether those procedural requirements have been met.

Lastly, the Court held that “Meaningful access to the court” as described by the application judge was not an element of the rule of law. To the Court, it seemed reasonable that there should be “meaningful access to the court in the sense of ensuring that a litigant’s claim is determined on its merits, including the right to present material evidence”, but the application judge’s “meaningful access” concept was not required by the rule of law on that account, nor did it engage the aspect of the rule of law dealing with physical access to courts as set out in B.C.G.E.U. v. British Columbia (Attorney General), [1988] 2 S.C.R. 214.

The Court stated it was noteworthy that in British Columbia v. Imperial Tobacco Canada Ltd., 2005 SCC 49 (“Imperial Tobacco”), the Supreme Court rejected several “fair civil trial” features asserted as protected by the rule of law in upholding the constitutionality of British Columbia legislation that went much further than s. 17 of the CLPA: it authorized actions by the provincial government against tobacco product manufacturers for the recovery of health care expenses incurred by the government, changed evidentiary requirements, permitted the government to establish aggregate claims, reversed the burden of proof in several respects, and operated retrospectively. The legislation changed the general rules of civil litigation considerably, but, as the Supreme Court stated, there was no constitutional right to have one’s civil trial governed by customary rules of civil procedure and evidence: Imperial Tobacco, at para. 76. The Court held that this conclusion applied with equal force in this case.

The overarching result was that the rule of law does not support a decision that renders unconstitutional procedural rules properly made pursuant to s. 92(14) of the Constitution Act, 1867. On the contrary, both the Constitution and the rule of law required that s. 17 of the CLPA be given effect.

Ontario v. St. Paul Fire and Marine Insurance Company, 2023 ONCA 173

[Paciocco, George and Favreau JJ.A.]

Counsel:

C. Lui and N. Brankley, for the appellant

A.A. Evangelista, D. Elshourfa and A. Cole, for the respondent

facts:

This appeal arose out of an underlying action relating to a class action commenced against Ontario on behalf of persons who were arrested and then detained for more than 24 hours prior to receiving a bail hearing between January 1, 2000 and “the present” (June 29, 2017). Anticipating that it would have insurance coverage for the claims made in the underlying action, Ontario provided notice of the claim to St. Paul, which had issued two successive general liability commercial policies to Ontario during the period contemplated by the underlying action. The first policy ran from March 31, 1998 to March 31, 2003 and included coverage of $20,000,000 for each occurrence under the policy (the “First Policy”). The second policy ran from March 31, 2003 to March 31, 2005, under which Ontario was self-insured for the first $5,000,000 described in the Second Policy as the “Ultimate Net Loss”, while St. Paul provided insurance of $15,000,000 for each “occurrence” in “excess of the Ultimate Net Loss” (the “Second Policy”).

On May 23, 2019, a motion judge denied certification of the underlying class action. Ontario had expended roughly $300,000 worth of legal services defending the claim and, on September 27, 2019, Ontario instituted an application for a declaration that St. Paul, the respondent, had a duty to defend it in the underlying class action. On November 25, 2021, the application judge dismissed Ontario’s application, finding that St. Paul did not have a duty to defend under either the First Policy or the Second Policy.

The application judge found that Ontario engaged in intentional acts that caused harm, had knowledge of the harms that would flow from its intentional acts, and took no steps to address those harms. The application judge concluded that the claim in negligence was derivative in nature from the intentional acts Ontario was alleged to have engaged in. The application judge found that the First Policy included coverage for damages resulting from bodily injury and personal injury where damage was caused by “an accident or occurrence” that was neither expected nor intended by the insured. The claims fell under bodily or personal injury, but the application judge found that there was no duty to defend arising out of the First Policy because the harms were expected. With respect to the Second Policy, the application judge found no duty to defend, again because the harms were expected. In addition, even if a duty to defend was found, the Second Policy covered claims in excess of the ultimate net loss of $5,000,000 and Ontario had only incurred defence costs of approximately $300,000. Ontario appealed the application judge’s decision.

issues:

Did the application judge fail to apply the possibility of coverage test?
Did the application judge err in considering extrinsic evidence?
Did the application judge err in identifying the true nature of the claim?
Did the application judge err in finding the negligence claims to be derivative?
Did the application judge err in failing to apply the nullification doctrine?
Did the application judge err in interpreting the coverage for an Occurrence under the Second Policy?
Did the application judge err in failing to apply the fortuity principle?
Did the application judge err in concluding that the application was premature?

holding:

Appeal Dismissed.

reasoning:

The Court held that the application judge did not fail to apply the possibility of coverage test. The application judge expressly recognized that the duty to defend extends only to claims that could potentially trigger indemnity under the policy, in doing so the application judge was satisfied that there was no possibility of coverage.

The Court found that the application judge did not err in considering extrinsic evidence contrary to the pleadings rule as the extrinsic evidence considered fell under an exception to the pleadings rule. The pleadings rule holds that a court may look only to the provisions of the policy and to the pleadings in the underling action when determining whether an insurer has a duty to defend. The rule is intended to encourage expedition and to discourage factual findings that could prejudice the underlying action. However, there is an exception which permits courts to consider extrinsic evidence that is explicitly referred to in the pleadings in the underlying action. The Court found that the application judge’s consideration of reports critical of Ontario’s bail release system fell within the exception because they were referred to in the underlying action. Additionally, the Court found that the application judge referred to the reports without making factual findings and used this extrinsic evidence without violating the pleadings rule, and without creating any of the mischief the pleadings rule is intended to prevent.

The Court found that the application judge did not err in identifying the true nature of the claim by failing to give Ontario the benefit of the ambiguity in the policy. The Court held that the application judge engaged in a careful and coherent analysis of the pleadings as a whole to arrive at an unambiguous outcome.

The Court held that the application judge did not err in finding the negligence claims to be derivative and saw no error in the application judge’s conclusion that when the claim is read as a whole, the true nature of the negligence claims was that they rested upon allegations of intentional conduct causing expected injuries.

The Court held that the application judge did not err in failing to apply the nullification doctrine. Citing its decision in Cabell v. The Personal Insurance Company, the Court stated that the “nullification doctrine” prevents insurance contracts from being construed so as to defeat the coverage the policy provides, thereby defeating the very objective of the insurance contract and rendering it nugatory. Ontario argued that the application judge’s finding that the term “neither expected nor intended from the standpoint of the Insured” prevented coverage for damages that Ontario knew the class would suffer, thereby nullifying the Personal Injury coverage for intentional torts which was expressly provided for in both the First Policy and the Second Policy. The Court held that this submission failed to recognize the important distinction between “the intention to cause injury itself … and the intention to commit the act that causes the injury.” The Court held that the nullification doctrine did not apply because the policies could be construed as providing coverage for the unintended or unexpected consequences of covered intentional acts.

Yes.

The Court held that the application judge erred in interpreting the coverage for an Occurrence under the Second Policy because the only reasonable view was that there was a reasonable possibility of coverage for Personal Injury “caused by an Occurrence during the Policy Period”, such as the wrongs alleged in the underlying action. The Court further held that the application judge “improperly limited…that which the parties agreed was covered.”

The application judge focused her analysis on the First Policy and applied the same reasoning to the Second Policy without considering the Personal Injury coverage under the Second Policy. Further, the application judge focused solely on Bodily Injury coverage under the Second Policy even though she found, when considering the First Policy, that the underlying action fell within the definition of both Bodily Injury and Personal Injury. The application judge concluded that the Second Policy did not respond to the claim without considering whether there was coverage under the Second Policy for Personal Injury. The Court held that language in the coverage provisions of an insurance policy should be given its plain and ordinary meaning, in keeping with the purpose of the policy, and it should be interpreted broadly to give effect to intended coverage. Under the Second Policy, Personal Injury coverage for an Occurrence did not include the limiting phrase “neither expected nor intended.” As a result, the Court held that, given that the underlying claim alleged wrongful detention, a form of wrong included in the definition of Personal Injury in the Second Policy, and given that the coverage for Personal Injury caused by an Occurrence is not limited to damage that is “neither expected nor intended from the standpoint of the Insured”, there was a reasonable possibility of coverage under the Second Policy for damages claimed in the underlying action.

The Court found that the application judge erred not only in failing to recognize a reasonable possibility of coverage under the Second Policy, but also that the application judge erred in failing to recognize that the claims made in the underlying action were all Personal Injury claims within the meaning of the policies, and not Bodily Injury claims. The Court stated that since the definitions of Personal Injury in the policies in this case did not include the words “other than bodily injury”, or any similar limitation, and since claims related to covered intentional acts were defined as Personal Injury claims under the policies, a claim alleging physical and psychological injury resulting from the commission of a covered intentional act fell within Personal Injury coverage. As a result, the Court found that there was doubtlessly a reasonable possibility under the Second Policy that such claims would be covered.

The Court held that the application judge did not err in failing to apply the fortuity principle because the principle did not apply in this case. Citing Liberty Mutual Insurance Co. v. Hollinger Inc., the Court noted that the fortuity principle provides that “ordinarily only fortuitous or contingent losses are covered by a liability policy.” The Court disagreed with the respondent’s argument that the Personal Injury coverage in the Second Policy is to be interpreted in light of the fortuity principle, and therefore must result in a finding that coverage extended only to unintentional or unexpected loss. The Court found that the fortuity principle is an interpretive aid that should not be applied to as to preclude coverage that the insurer agreed to provide. As the respondent agreed to provide coverage for wrongful detention, it could not rely on the “fortuity principle” to avoid that coverage.

Although the Court concluded that the application judge erred in interpreting the provisions of the Second Policy, it agreed that, in any event, the duty to defend was not triggered in the particular circumstances of this case. When the applicable provisions of the Second Policy were read as a whole, the court found it apparent that Ontario must bear the costs of what it was obligated to pay as the result of the underlying action, including defence costs, up to $5,000,000, before the duty to defend arose. Because Ontario expended only $300,000 in costs at the time of the application, St. Paul’s obligation to indemnify Ontario for its defence costs was not triggered.

Dieffenbacher v. Dieffenbacher IV, 2023 ONCA 189

[Lauwers J.A. (Motion Judge)]

Counsel:

[COUNSEL]

J. Montes and G. Ichim, for the applicant

K. Svozilkova and J. Cooper, for the respondent

facts:

The parties were parents of a son born in March 2022 in New York State. The parties cohabited in New York from December 2020 until January 2023. The mother stated that she moved to New York on a trial basis with the understanding that the father would recover from drug and alcohol abuse. She argued this did not happen and that the father was abusive towards her and their child. The mother claimed that in October 2022, the father consented to her moving back to Ontario with the child. The mother left New York and returned to Ontario with the child on January 6, 2023.

The father commenced divorce and custody proceedings in New York on or about January 13, 2023. On January 20, 2023, the New York court gave the father sole custody and primary physical residence of the child. On or about January 23, 2023, the father commenced an application in Ontario under the Hague Convention for the return of the then ten-month old child. At the Hague Convention hearing on February 6, 2023, the application judge found that the child’s habitual residence was in New York and dismissed the mother’s assertion that her residence in New York was temporary. The application judge found that the father was exercising custody rights at the time of removal; the father did not consent to the child’s removal since the mother left for Ontario in the middle of the night without notice; there was no evidence of abuse; and despite the father admitting to drinking and occasional drug use, there was no evidence of addiction or that the child was at risk.

The application judge’s order set out undertakings for the father, including vacating the parties’ family home in New York, and abstaining from drugs and alcohol while in a caregiving role. The mother appealed and moved on an urgent basis for a stay of the order pending the disposition of the appeal.

issue:

Should the Court grant the mother’s motion to stay the application judge’s order pending appeal?

holding:

Motion dismissed.

reasoning:

No.

The Court confirmed that the factors to consider for a stay pending appeal are: (1) whether there is a serious issue to be tried, (2) whether there would be irreparable harm for the applicant if the stay were refused, and (3) an assessment of who would suffer greater harm based on the court’s decision. No single factor is determinative. The overarching consideration was whether the interests of justice call for a stay. The Court noted that the motion must be considered through the lens of the Hague Convention. More specifically, applications pursuant to the Hague Convention are to be dealt with expeditiously because delays favour the non-complying parent and can have a detrimental impact on the child.

For the first element of the test to grant a stay, the Court noted that it is not a high threshold. Even though the mother pointed to no legal errors by the application judge, the Court stated that the appeal met the low threshold, as it was not frivolous. However, for the second element, the Court held that the mother did not meet her onus of demonstrating irreparable harm. In the context of a Hague Convention application, there is no irreparable harm if the child is returned and there is greater harm done when custody determinations are delayed. The Court found that the mother absconded with the child and provided no reason for why this conduct should not be sanctioned.

Lastly, the Court held that the balance of convenience did not favour the mother. She had not participated in the New York proceedings and her continued avoidance of lawful determinations was not in the best interest of the child. Ultimately, the concerns raised by the mother were addressed though the father’s undertakings.

Cronier v. Cusack, 2023 ONCA 178

[Paciocco, Harvison Young and Thorburn JJ.A.]

Counsel:

P. L. W. C., acting in person

C. C., acting in person

facts:

The appellant and respondent were married on December 6, 2008, and separated by January 31, 2015. In September 2015, the respondent wife commenced an application seeking the equalization of the parties’ net family property (“NFP”). Five years later, the trial of the application took place and both parties were self-represented. The trial judge observed that it was a very contested, high-conflict case for a couple with no children of the marriage. The parties had been unable to agree on anything.

In his first order dated March 8, 2021, the trial judge resolved several issues arising from the NFP statements filed by the parties. He requested that the parties submit fresh NFP statements reflecting his determinations with a view to narrowing the issues and finalizing the equalization payment calculation. Against the trial judge’s directions, the parties submitted revised NFP statements that did not incorporate the findings contained in the March 8, 2021 order. Instead, the new NFP statements widened the gap between the parties’ positions. Moreover, the appellant’s revised NFP, in which he sought an equalization payment of $42,159.01 from the respondent, introduced the new issue of whether the respondent wife owed him an equalization payment, a claim not previously made. In the result, the trial judge ordered the appellant to make an equalization payment of $59,929.86 to the respondent.

Both parties appealed from the orders, arguing that the trial judge fell into reversible error. The appellant argued that the trial judge erred in valuing the parties’ assets, and in failing to indicate which NFP statement he was relying on in his final determination of the equalization payment. He submitted that these errors resulted in the order that he pay an equalization payment to the respondent when no equalization payment was owed by either party.

In her cross-appeal, the respondent argued that the trial judge’s errors favoured the appellant and that the trial judge should have ordered an equalization payment to her in the amount of $127,953.91. In the last NFP statement she filed before the trial judge made his final endorsement, the respondent sought an equalization payment of $122,353. However, she submitted two subsequent NFP statements, which she prepared for the appeal with the help of a lawyer. In the first NFP statement, which did not incorporate the findings of the trial judge, the respondent calculated her equalization payment entitlement at $127,953.91. In the second NFP statement, which was the first and only to incorporate the findings made by the trial judge, the respondent calculated her equalization payment entitlement at $61,016.26, which was a de minimis difference from the $59,929.86 figure reached by the trial judge.

issues:

Did the trial judge err in failing to indicate which NFP statement he was relying upon?
Did the trial judge err in assigning a value of $10,000 to the appellant’s car at the date of marriage?
Did the trial judge err in disallowing the valuation date deduction the appellant sought for his debt to a judgment creditor?
Did the trial judge err in finding that the appellant owned the funds found in his legal trust account?
Did the trial judge err in his calculation of the amount owing to the appellant from his former employer at the date of marriage?
Did the trial judge err in his treatment of the Parc property?

holding:

Appeal dismissed.

reasoning:

The Court found the problem with the appellant’s submission was that it was clear from the trial judge’s final endorsement that he could not rely on any of the NFP statements filed by the parties because neither had followed his direction for the purpose of preparing revised NFP statements. The Court found that, in the circumstances, the trial judge’s failure to indicate which NFP statement he was relying on was not an error. Instead, the trial judge properly considered all the evidence before him to arrive at his own conclusions, which he was entitled to do on the record before him.

The appellant submitted that the trial judge erred in assigning a value of $10,000 to his car at the date of marriage. The appellant claimed that there was no evidence to support this amount because he claimed that it was worth $16,000 and the respondent wife claimed it was worth $12,000 as of the date of marriage. The trial judge noted that while the parties had agreed that some value should be attributed to the car, neither party had produced “blue book” or “black book” values as evidence, and their respective values appeared to be arbitrary. The Court found the trial judge dealt with the case in a fair manner, in accordance with rules 2(2)-(4) of the Family Law Rules.

The trial judge considered the issue raised by the appellant seeking to include his debt to a judgment creditor as at the valuation date and found that while the litigation pre‑dated the parties’ marriage, the costs order was made against the appellant after the date of marriage, in November 2011. While the trial judge did not address the question of whether this amount remained owing as of the valuation date as the appellant claimed, there was no clear evidence on the issue and the Court found the appellant had not identified any palpable and overriding error that could justify interfering with the trial judge’s finding.

The Court found no palpable and overriding error with the trial judge’s finding that the $18,547.06 that was in his legal trust account was an asset owned by the appellant as of the valuation date. The backdrop to this conclusion was, in part, the respondent wife’s insistence that the appellant had accounts that he had failed to disclose. She obtained a court order that the appellant provide a Work-In-Progress (“WIP”), but none was ever provided. At trial, he admitted that he had never provided a statement, but stated that this was because his legal business had “zero value” as of the date of separation. As the trial judge noted, however, that “unilateral assessment of the value of the WIP [was] not his to make”. Rather, “it is a finding to be made by the Court, and the [appellant] simply did not live up to his court-ordered obligations.” There was evidence at trial “that there were eight client files opened as of the date of separation, although with no value described [sic] to those files by the [appellant].” The respondent wife alleged that there were additional files that the appellant had not disclosed and asked the court to impute a value of $69,443.43 as of the date of separation. The trial judge considered photographs that the respondent wife had taken of documents that were scattered around the house. The appellant objected to the admission of this evidence on the basis that the documents had been illegally obtained, and that they were protected by solicitor-client privilege. The trial judge rejected the first argument, finding that the admission of the documents would not prejudice the administration of justice. He went on to say that while there may have been an argument that the documents were privileged, the appellant husband was given many chances to produce a WIP statement, which he could have redacted to protect the identities of his clients but failed to do so. The Court found it was the respondent’s onus to prove that no WIP was indeed owing – a fact of which he was aware since an interim disclosure order was made seeking that information. Since he had not met that onus, it was appropriate to draw an adverse inference against him on this point and impute $50,000 as WIP owing.

The husband sold his Ottawa practice to his firm before the date of marriage. He took issue with the amount that the trial judge attributed to the portion still owing to him at the date of marriage. He claimed that the problem arose because he forgot to include $44,000 of this amount and accordingly, his July 12, 2018, NFP statement contained an amount that was erroneously $75,000 rather than $119,000, which he corrected in his March 29, 2019 NFP statement, and testified to in his oral evidence. The respondent wife, in her cross-appeal, submitted that the trial judge erred in finding that there was any pre-marriage debt owing to the appellant based on the evidence led by the appellant.

The Court disagreed with both parties. The trial judge addressed this issue expressly and was not prepared to accept the appellant’s evidence as to the higher amount. In the end, he accepted the evidence that his employer owed the appellant the lower amount of $75,000 at the date of marriage. Neither party had pointed to any error on the part of the trial judge. His finding was grounded in the record.

The appellant had owned the Parc property when the parties’ relationship began. However, the respondent purchased it from the appellant before they were married, largely because the appellant was in substantial debt at the time. At trial, the appellant argued that he was entitled to claim $28,000 in pre-marriage property for the Parc property. However, by the date of marriage, the respondent had purchased the property from the appellant. The trial judge reviewed the history of the parties’ arrangements for this property and ultimately rejected the appellant’s claim. The Court found there were clear findings of fact and the appellant’s submissions had pointed to no palpable and overriding error.

The Court found the trial judge’s approach was consistent with the Family Law Act. Parc was not a matrimonial home. It was owned by the respondent at the date of marriage, and she was clearly entitled to the pre-marriage deduction. The appellant, who was asserting a qualification or limitation to the deduction, had the onus of showing that the $28,000 he was claiming was warranted and he failed to do so. Both parties claimed that binding agreements governed their financial and in-kind contributions. Each claimed different terms to these agreements. In the face of these claims, the Court said the trial judge reasonably found that while there were discussions and various iterations of draft agreements prepared, there was no binding agreement.

The Cross-Appeal

The respondent wife submitted by way of cross-appeal that the trial judge committed three main errors by (a) attributing the full amount (instead of half) of a $14,907.55 joint line of credit to her as a debt owing on the date of marriage (“Scotiabank LC”) (b) declining to treat the appellant’s CRA debts as pre-marriage debts and (c) allowing the $75,000 amount owed by the husband’s former law firm as a pre-marriage asset deduction.

She argued the appellant husband owed her a significantly higher equalization payment than the amount ordered by the trial judge. With respect to the Scotiabank LC, the trial judge considered the evidence before him and explained in his reasons why he concluded that the balance as of the date of marriage was hers alone. That finding was open to him on the record before him and there was no basis for interfering with it. Similarly, the trial judge addressed the respondent’s claim that the CRA debt was owing on the date of marriage. He noted that the evidence was ambiguous on this point and concluded that he could not “find sufficient evidence on a balance of probabilities to attribute this CRA debt to the [appellant] as of the date of marriage.” The Court saw no error of law or palpable and overriding error in this assessment. Accordingly, the Court dismissed the cross-appeal.

778938 Ontario Limited v. EllisDon Corporation, 2023 ONCA 182

[Roberts, Nordheimer and Favreau JJ.A.]

Counsel:

J.V. Bakel and S. Gordon, for the appellant

M. P. Falco and A. Jovanovic, for the respondents

facts:

Proceedings were commenced related to the respondents’ condominium construction project in Halifax, Nova Scotia (“the project”). The respondents contracted with the appellant, Ellis Don, to provide pre-construction and construction management services in relation to the project. The appellant is a registered Ontario corporation, with offices in Mississauga and Ottawa. All parties are extra-provincial corporations, duly registered to carry on business in Nova Scotia.

On October 2, 2019, one of the subtrades engaged to provide services on the project, Omega Formwork Inc. (“Omega”), commenced an action in Nova Scotia against the respondents. On January 25, 2020, the respondents also commenced a third party claim against the appellant, seeking contribution and indemnity for any damages awarded to Omega. On June 30, 2020, the appellant responded with a defence and counterclaim against the respondents, claiming damages that were not limited to issues related to Omega, but encompassed the entire project. On July 8, 2020, the respondents delivered a defence to the appellant’s counterclaim.

Prior to the appellants delivery of its defence and counterclaim, on May 29, 2020, the respondents commenced Ontario proceedings against the appellant by issuing a notice of action and on or around June 9, 2020, delivered a statement of claim. They sought damages of around $20 million against the appellant, alleging mismanagement and delay by the appellant in relation to the entire project in Halifax. The appellant has not yet defended the action. Instead, it brought a motion to contest the jurisdiction of the Ontario court, arguing that the court lacks jurisdiction simpliciter because of an absence of a real and substantial connection with the subject-matter of the action, and that Nova Scotia is clearly the more appropriate jurisdiction in which to try the dispute. That motion was dismissed.

The appellant appealed from the motion judge’s dismissal of its motion to stay the Ontario action. The motion judge’s reasons were only partially transcribed, thus preventing meaningful appellate review. As a result, the Court undertook a fresh analysis of the issues, citing s. 134(1)(a) of the Courts of Justice Act.

issues:

Did the motion judge err in concluding that Ontario has jurisdiction simpliciter over the subject-matter of the action?
If not, did the motion judge err in failing to conclude that Nova Scotia is clearly the more appropriate forum for the adjudication of the parties’ dispute given the multiplicity of proceedings and real risk of inconsistent findings?

holding:

Appeal allowed.

reasoning:

The Court was not persuaded that the appellant had demonstrated that there was a weak relationship between the forum and the subject-matter of the litigation that the proposed assumption of jurisdiction would be inappropriate.

The Court held that the assumed jurisdiction is made out by the real and substantial connection between the subject-matter of the action and the forum. In addition to the presence of the parties in Ontario, the Court held that there were other connecting factors, such as the fact the contract was negotiated by the parties in Ontario and signed in Ontario by the respondent, at its headquarters in Ontario.

The Court held that it was a fair inference that the corporate decision to enter into the contract was made by its corporate decision-makers located in the appellant’s head office in Ontario. Accordingly, the Court agreed with the motion judge’s conclusion that Ontario had “clear jurisdiction”.

Yes.

The Court noted that a court retains the residual discretion to displace a plaintiff’s right to choose the forum for the adjudication of its claim and decline jurisdiction if the defendant satisfies its burden of demonstrating that another jurisdiction is clearly the more appropriate forum. The factors to determine forum non conveniens include the following:

i. the relative strengths of the parties’ connections to each forum;

ii. the interests of both parties: the comparative convenience and expense for the parties to the proceeding and for their witnesses in litigating in the court or in any alternative forum, including the domicile of the parties, and the locations of witnesses and of pieces of evidence;

iii. the law to be applied to issues in the proceeding;

iv. the desirability of avoiding a multiplicity of legal proceedings, and of avoiding conflicting decisions in different courts;

v. the enforcement of an eventual judgment;

vi. juridical advantage or disadvantage; and

vii. the interests of justice, including the fair and efficient working of the Canadian legal system as a whole.

The Court noted that many of the factors almost equally favoured both jurisdictions. However, the Court held that when a comparison between the respondents’ third party claim and their Ontario action is made, it was clear that the allegations in the respondents’ statement of claim mirrored those in the respondents’ third party claim against the appellant in the Omega action in Nova Scotia.

The Court did not agree with the motion judge’s conclusion that the Omega action and the appellant’s counterclaim are “the tail…wagging the dog” and that the appellant was importing issues from the Ontario action into the Nova Scotia action. Instead, the Court held that it was the respondents that first expanded the issues in the Omega action beyond the dispute with Omega to encompass the appellant’s management of the entire project. The appellant was entitled, and indeed obliged, to respond to all the respondents’ allegations that went beyond the appellant’s interactions with Omega.

In the Court’s view, all the principal issues between the respondents and the appellant in both actions overlapped, leading to the likelihood of inconsistent findings. The Court held that it was therefore difficult to see how case management could avoid the potential for inconsistent findings unless the parties agreed that the Nova Scotia court would not determine the respondents’ third party claim and the appellant’s counterclaim. As the pleadings currently stood, the Court held that the trial judges in both provinces would be required to make findings on the same issues.

Accordingly, the Court concluded that Nova Scotia was clearly the more appropriate forum for the hearing of the dispute as it was presently pleaded.

The appellant also advanced the alternative position that an interim stay should be granted pending the determination of the status of the Nova Scotia proceedings. As a result of the respondent’s agreement to this, the Court ordered that the Ontario action be stayed on an interim basis and without prejudice to the parties returning before the Ontario Courts to lift the stay.

Zapfe Holdings Inc. v. 1923159 Ontario Inc., 2023 ONCA 190

[Fairburn A.C.J.O., Brown and Sossin JJ.A.]

Counsel:

M. Myers, M. Krygier-Baum and P. Benipal, for the appellants

S.H., acting in person for the respondent

Keywords: Contracts, Real Property, Mortgages, Enforcement, Possession, Power of Sale, Hume v. 11534599 Canada Corp., 2022 ONCA 575

facts:

The appellants, Zapfe Holdings Inc. and MS (the “Mortgagees”), loaned $3 million to the respondent, 1923159 Ontario Inc. (the “Mortgagor”), secured by a charge on its commercial property in Bracebridge. The Mortgagor defaulted on the mortgage, whereupon the Mortgagees issued a notice of sale under the mortgage.

On May 6, 2022, the Mortgagees attempted to take possession of the property, as permitted by the mortgage. However, the Mortgagor refused to vacate the premises, which were occupied by it and by some commercial tenants.

Instead of commencing a proceeding to obtain a writ of possession and enforce the mortgage, the Mortgagees made a second self-help effort to take possession of the property in the early morning hours of May 18, 2022, when neither the Mortgagor nor the property’s tenants were present. When the Mortgagor’s principal arrived later that morning, the police were called and advised the Mortgagees that they should restore possession to the Mortgagor. They refused, and the Mortgagor’s principal cut the locks and re-entered.

The Mortgagees immediately applied for an order restraining the Mortgagor from access to and possession of the property, a declaration that they were mortgagees in possession of the property as permitted under the mortgage, and an order restoring the state of affairs to that which prevailed on the morning of May 18, 2022, when the Mortgagees had taken possession of the property. The application judge dismissed the application. The Mortgagees appealed.

issues:

Did the application judge err in dismissing the Mortgagees’ application?

holding:

Appeal dismissed.

reasoning:

No.

After the application judge released her reasons, the Court had issued its decision in Hume v. 11534599 Canada Corp. (“Hume”), which contained an extensive review of the jurisprudence on the requirement that a mortgagee take peaceable possession of a property.

Since the application judge did not have the benefit of the Court of Appeal’s decision in Hume, the Court held that it was not surprising that her reasons made some reference to principles found in the pre-Hume jurisprudence that were clarified or disavowed by Hume. However, in the Court’s view, her decision rested on the core legal principles affirmed in Hume, which were:

a mortgagee who is entitled to take possession of a property must do so peaceably;
taking peaceable possession refers to the manner in which a mortgagee who has a legitimate entitlement to possession of a property actually takes possession of that property;
whether a mortgagee has taken peaceable possession of a property is a fact-driven inquiry that depends on the circumstances;
at a minimum, taking peaceable possession means taking possession of a property without violence or threat of violence;
factors that will inform a court’s assessment of a mortgagee’s conduct include whether the property was vacant or unoccupied at the time of taking possession; whether there was any physical or verbal resistance to the taking of possession at the time the mortgagee took possession; whether the property was used as a dwelling-place; and whether the mortgagee’s possession would dispossess any person of their home; and
whether changing the locks constitutes peaceable conduct will depend upon the circumstances.

The Court held that the application judge correctly applied the core legal principles in Hume in finding that the Mortgagees had not taken peaceable possession, and saw no basis to interfere. The standard of review of that finding was strict and the appellants did not demonstrate that the application judge made a palpable and overriding error in reaching that conclusion.

SHORT CIVIL DECISIONS

East Elgin Concrete Forming Limited v. 9001522 Canada Limited, 2023 ONCA 175

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

Counsel:

S. Mackay, for the moving party/responding party by cross-motion

P. Bakos, for the responding party/moving party by cross-motion

Keywords: Civil Procedure, Appeals, Jurisdiction, Construction Act, R.S.O. 1990, c. C.30, s. 71(1)

Gallen v. Sutherland, 2023 ONCA 170

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

Counsel:

J. Rosenstein, for the moving parties

SS, acting in person

Keywords: Civil Procedure, Appeals, Jurisdiction, Orders, Final or Interlocutory, Rules of Civil Procedure, rr. 37.14, 59.06, Elguindy v. Elguindy, 2021 ONCA 708

Forest Hill Fine Homes Inc. v. Heartland Farm Mutual Insurance Co., 2023 ONCA 171

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

Counsel:

K.N. Hirani, for the appellant

J.T. MacQuarrie, for the respondents

Palmer v. Ioannidis, 2023 ONCA 179

[Fairburn A.C.J.O., Brown and Sossin JJ.A.]

Counsel:

I. de Rijcke and R. Fenn, for the appellant

P.G. Morris, for the respondents

Keywords: Real Property, Gifts, Possessory Title, Adverse Possession, Torts, Trespass

Re/Max Realty Specialists Inc. v. 2452303 Ontario Inc., 2023 ONCA 186

[Fairburn A.C.J.O., Brown and Sossin JJ.A.]

Counsel:

D.F. Chitiz, for the appellants

B. Hanuka, for the respondent

Keywords: Civil Procedure, Evidence, Burden of Proof, Balance of Probabilities, Joint and Several Liability, R. v. Ménard, [1998] 2 S.C.R. 109

Chahal v. Caledon (Town), 2023 ONCA 188

[Roberts, Nordheimer and Thorburn JJ.A.]

Counsel:

B. Romano and J. Nussbaum, for the appellants

S. Rouleau and C. deSereville, for the respondent

Keywords: Real Property, Municipal Law, Land Use Planning, Legal Non-conforming Use, Evidence, Admissibility, Hearsay, Planning Act, R.S.O. 1990, c. P.13, s. 34(9)

Bowen v. JC Clark Ltd., 2023 ONCA 181

[Feldman, George and Copeland JJ.A.]

Counsel:

S.J. Erskine and F. Dickson, for the moving parties

J.G. Knight and L.J. Freitag, for the responding party

Sutton v. Sutton, 2023 ONCA 192

[Lauwers J.A. (Motion Judge)]

Counsel:

JS, acting in person

T. Garton, for the respondent

KLN Holdings Inc. v. Grant, 2023 ONCA 193

[Lauwers J.A. (Motion Judge)]

Counsel:

GG, acting in person

M. Myers and P. Benipal, for the respondents

The information contained in our summaries of the decisions is not intended to provide legal advice and does not necessarily cover every matter raised in a decision. For complete information or for specific advice, please read the decision or contact us.

COURT OF APPEAL SUMMARIES (March 6, 2023 – March 10, 2023)

By John Polyzogopoulos on March 11, 2023

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

Good afternoon.

Following are this week’s summaries of the Court of Appeal for Ontario for the week of March 6, 2023.

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In Working Families Coalition (Canada) Inc. v. Ontario (Attorney General), the Court released its decision pertaining to three appeals concerning the Election Finances Act (“EFA”) and whether it infringed the informational component of the right to vote under section 3 of the Charter. The amendments to the EFA restricted spending on advertising by third parties to $600,000 in the twelve months leading up to the provincial election. In each case, the appellants argued that the application judge erred in interpreting and applying sections 33 and 3 of the Charter, and that such infringements were not saved under section 1. The Court considered the constitutionality of the provisions of the EFA that were struck down, then re-enacted unchanged through Protecting Elections and Defending Democracy Act, 2021, which invoked the notwithstanding clause under section 33 of the Charter. Justices Zarnett and Sossin, for the majority, held that the application judge did not err in finding that there was no infringement of section 33, but did err in finding no infringement of section 3. Further, applying the Oakes test, the majority of the Court held that the infringement of section 3 was not saved under section 1 of the Charter. In a dissenting opinion decision, Justice Benotto found that section 3 of the Charter was not infringed, agreeing with the application judge.

In Children’s Aid Society of London and Middlesex v. T.E., the Court considered an appeal from a motion judge’s decision dismissing the appellant’s motion to be added as a party to a child’s protection proceeding. The Court found that the motion erred in considering only the discretionary party status under the Family Law Rules stating that the motion judge should have also considered the provincial legislation, Child, Youth and Family Services Act, and the federal legislation, An Act respecting First Nations, Inuit and Métis children, youth and families. Accordingly, the motion judge erred by equating the appellant kin giver to a foster parent (the latter being statutorily excluded as a having party status). In so doing, the Court found that the child protection proceeding should not have been dismissed before determining who the parties were. The Court found that by not determining the parties and dismissing the application, the motion judge failed to consider the best interests of the child.

In Niagara Falls Shopping Centre Inc. v. LAF Canada Company, the Court grappled with determining the obligations of a landlord and tenant to a commercial lease pursuant to a force majeure clause. The Court held that the force majeure clause was triggered by the government lockdown announcement during the COVID-19 pandemic. However, the Court stated that the force majeure clause only operated to excuse the landlord of its obligations during the lockdown period. This was because the landlord’s inability to fulfill the contract was solely because of the government announcement, whereas the tenant’s inability pay rent was a lack of funds. A lack of financial ability to pay was expressly excluded as an event that triggered the force majeure clause.

Other topics covered this week included a extension of time to appeal, summary judgment and a claim for coverage under a credit risk insurance policy.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Ines Ferreira
Blaney McMurtry LLP
416.597.4895 Email

Civil Decisions

Working Families Coalition (Canada) Inc. v. Ontario (Attorney General), 2023 ONCA 139

Keywords: Election Law, Election Spending Restrictions, Constitutional Law, Freedom of Expression, Political Advertising, Notwithstanding Clause, Oakes Test, Election Finances Act, R.S.O. 1990, c. E.7, s. 1(1), s. 37.0.1, s. 37.10.1(2), s. 37.10.1(3.1), s. 37.10.2, s. 45.1, s. 46.0.2, s. 47, s. 48, Canadian Charter of Rights and Freedoms, s.1, s.2(b), s. 3, s. 33, s. 33(1), s. 33(3), Protecting Elections and Defending Democracy Act, 2021, S.O. 2021, c. 31, Election Act, R.S.O. 1990, c. E.6, s. 9(2), s. 53.1(1), Libman v. Quebec (Attorney General), [1997] 3 S.C.R. 569, Harper v. Canada (Attorney General), 2004 SCC 33, Working Families Ontario v. Ontario, 2021 ONSC 4076, Housen v. Nikolaisen, 2002 SCC 33, Ford v. Quebec (Attorney General), [1988] 2 S.C.R. 712, Frank v. Canada (Attorney General), 2019 SCC 1, Figueroa v. Canada (Attorney General), 2003 SCC 37, Alberta v. Hutterian Brethren of Wilson Colony, 2009 SCC 37, R. v. Oakes, [1986] 1 S.C.R. 103, Harper v. Canada (Attorney General), 2001 ABQB 558, Marcoux v. Bouchard, 2001 SCC 50, R. v. G.F., 2021 SCC 20, Robert Leckey & Eric Mendelsohn, “The Notwithstanding Clause: Legislatures, Courts, and the Electorate” (2022), 72:2 U.T.L.J. 189, Yasmin Dawood, “The Process of Electoral Reform in Canada: Democratic and Constitutional Constraints” (2016), 76 S.C.L.R. (2d) 353, at p. 359

Fockler v. Speigel, 2023 ONCA 148

Keywords: Solicitor and Client, Negligence, Civil Procedure, Summary Judgment, Limitation Periods, Appeals, Fresh Evidence, Limitations Act, 2002, S.O. 2002, c. 24, ss. 4-5, Rules of Civil Procedure, rr. 37.14, r. 59.06, Waite v. Gershuny (2005), 194 O.A.C. 326 (Div. Ct.), Dass v. Kay, 2021 ONCA 565, Palmer v. The Queen, [1980] 1 S.C.R. 759

Children’s Aid Society of London and Middlesex v. T.E., 2023 ONCA 149

Keywords: Family Law, Child Protection, Custody and Access, First Nations, Customary Care Agreements, Best Interests of the Child, Civil Procedure, Party Status, Kin Caregivers, Foster Parents, Children’s Law Reform Act, R.S.O. 1990, c. C.12., Child, Youth and Family Services Act, 2017, S.O. 2017, c. 14, Sched. 1, section 74(1) and section 79(1), First Nations, Inuit and Métis children, youth and families, S.C. 2019, c. 24, s. 13, United Nations Convention on the Rights of the Child, Can. T.S. 1992 No. 3, Family Law Rules, O. Reg. 114/99, r. 7(5), M.L. v. Dilico Anishinabek Family Care, 2022 ONCA 240, A.M. v. Valoris Pour Enfants et Adultes de Prescott-Russell, 2017 ONCA 601, Catholic Children’s Aid Society of Toronto v. D.L., 2014 ONCJ 587, Durham Children’s Aid Society v. J.S., 2022 ONSC 2535, SMCYFS v. D.D., 2021 ONSC 1994, Windsor-Essex Children’s Aid Society v. D.L.H., 2015 ONCJ 310, Cadieux v. Cloutier, 2018 ONCA 903

Grimm v. Ontario (Children’s Lawyer), 2023 ONCA 161

Keywords:Family law, Parenting, Civil Procedure, Appeals, Security for Costs, Frivolous and Vexatious,Courts of Justice Act, R.S.O. 1990, c. C.43, s. 133(b), Rules of Civil Procedure, r. 61.06, Yaiguaje v. Chevron Corporation, 2017 ONCA 827, Schmidt v. Toronto-Dominion Bank (1995), 24 O.R. (3d) 1 (C.A.), R. v. R. (2002), 58 O.R. (3d) 656 (C.A.), A.G.L. v. K.B.D (2009), 93 O.R. (3d) 409 (S.C.), Barresi v. Jones Lang Lasalle Real Estate Services Inc., 2019 ONCA 884, McNaughton Automotive Limited v. Co-Operators General Insurance Company (2008), 95 O.R. (3d) 365 (C.A.), Brad-Jay Investments Ltd. v. Szijjarto, 218 O.A.C. 315 (2006) (C.A.), Hamilton v. Open Window Bakery Ltd., 2004 SCC 9

Niagara Falls Shopping Centre Inc. v. LAF Canada Company, 2023 ONCA 159

Keywords:Contracts, Interpretation, Real Property, Commercial Leases, Force Majeure, COVID-19 Restrictions, Civil Procedure, Standard of Review, Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co., 2016 SCC 37, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Atlantic Paper Stock Ltd. v. St. Anne-Nackawic Pulp and Paper Company Limited, [1976] 1 S.C.R. 580, Windsor-Essex Catholic District School Board v. 2313846 Ontario Limited o/a Central Park Athletics, 2022 ONCA 235

Short Civil Decisions

Rivas v. Anobile, 2023 ONCA 158

Keywords: Family Law, Matrimonial Home, Trust Property, Fraud, Breach of Fiduciary Duty

908593 Ontario Limited v. Atradius, 2023 ONCA 156

Keywords:Bankruptcy and Insolvency, Receiverships, Contracts, Insurance, Interpretation, Standard of Review, Palpable and Overriding Error, Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co., 2016 SCC 37, [2016] 2 S.C.R. 23, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Hemlow Estate v. Co-operators General Insurance Company, 2021 ONCA 908, Apps v. Grouse Mountain Resorts Ltd., 2020 BCCA 78, Crosby (Estate) v. Native Fishing Assoc., 2001 BCCA 118, Chilton v. Co-Operators General Insurance Co. (1997), 32 O.R. (3d) 161 (C.A.)

Tiwari v. Singh, 2023 ONCA 163

Keywords: Real Property, Mortgage, Civil Procedure, Summary Judgment, Evidence, Admissibility, Hearsay, Documents, Authenticity Rules of Civil Procedure, r. 20.02(1), Sweda Farms Ltd. v. Egg Farmers of Ontario, 2014 ONSC 1200

Buffone v. Sokil, 2023 ONCA 168

Keywords: Wills and Estates, Civil Procedure, Contempt, Appeals, Stay Pending Appeal, Carey v. Laiken, 2015 SCC 17, [2015] 2 S.C.R. 79, Belton v. Spencer, 2020 ONCA 623

Hill v. Cambridge (City), 2023 ONCA 164

Keywords: Civil Procedure, Vexatious Litigants, Appeals, Extension of Time, Rules of Civil Procedure, r. 2.1.01(1), Sabatino v. Posta Ital Bar Inc., 2022 ONCA 208

CIVIL DECISIONS

Working Families Coalition (Canada) Inc. v. Ontario (Attorney General), 2023 ONCA 139

[Benotte, Zarnett and Sossin JJ.A.]

Counsel:

H. Goldblatt, C. Davies, and A. Goldfinch, for the appellants the Elementary Teachers’ Federation of Ontario and F.P.
P. Cavalluzzo, A. Telford, M. Thomarat, and K. Sier, for the appellants Working Families Coalition (Canada) Inc. and the Ontario English Catholic Teachers’ Association
S. Ursel, K. Allen, E. Home, and N. Abraham, for the appellants the Ontario Secondary School Teachers’ Federation and L.W.
R.W. Staley, J.G. Bell, D.A. Fenton, A.N. Sahai, and M.E. Steeves, for the respondent the Attorney General of Ontario
S. Aylward and D. Rakic, for the intervener the Chief Electoral Officer of Ontario
J. Cameron, C.D. Bredt, M. Kakkar, and D. Milton, for the intervener Centre for Free Expression at Ryerson University
C. Smith, M. Law, and P. Wodhams, for the intervener Democracy Watch
L. Rauccio, S. Armstrong, W.D. Rankin, and G. Buitenhuis, for the intervener the Canadian Civil Liberties Association

facts:

In 2017, the year before the 2018 provincial election, Ontario legislatively imposed a $600,000 spending limit on political advertising by third parties. The limit applied to the 6-month period prior to the writs of election being issued. Ontario once again amended the Election Finances Act (“EFA”) in 2021, the year before the 2022 provincial election. This time it extended the period to which that monetary limit applied from 6 months to 12 months before the writs, but with no increase in the amount that could be spent.

The amendments sparked constitutional challenges. In the first proceedings (“Working Families 1”), the appellants successfully challenged the $600,000 spending limit that applied during the 12-month pre-writ period and other related EFA provisions on the basis that they infringed third party advertisers’ rights to freedom of expression under s. 2(b) of the Canadian Charter of Rights and Freedoms (“Charter”) and could not be justified under s. 1. In response to that ruling, the Ontario government announced its intention to invoke the notwithstanding clause in s. 33 of the Charter, and introduced Bill 307, which received Royal Assent five days later as the Protecting Elections and Defending Democracy Act, 2021 (“PEDDA”).

In the second proceeding, the appellants challenged the legislation as a violation of s. 3 of the Charter, and as an improper use of the notwithstanding clause. They relied on s. 3, because, unlike free expression rights under s. 2(b) of the Charter, which fall within the ambit of the notwithstanding clause, voting rights do not fall within the ambit of the notwithstanding clause. The application judge concluded that the use of the notwithstanding clause in enacting PEDDA was not improper, and that the re-enacted spending limits on third party advertising during the pre-writ period did not infringe the right to vote under s. 3.

The appellants appealed on the basis that the application judge erred in his interpretation and application of ss. 3 and 33 of the Charter. They argued that he erred in finding that a spending restriction that is twice as restrictive as the 6-month restriction did not infringe voting rights under s. 3.

issues:

(1) Did the application judge err in interpreting and applying s. 33 of the Charter?
(2) Did the application judge err in interpreting and applying s. 3 of the Charter?
(3) If s. 3 was infringed, could the infringement be saved under s. 1?

holding:

Appeals allowed.

reasoning:

(1) No.

The Court agreed with the application judge’s rejection of the appellants’ claim that s. 33 was not validly invoked, as its formal requirements were met and no other precondition to its invocation existed in law (Ford v. Quebec (Attorney General)). No substantive justification by a legislature for invoking the notwithstanding clause is required.

The Ontario Secondary School Teachers’ Federation (“OSSTF”) argued that s. 33(3), which limited the validity of an invocation of the notwithstanding clause to five years, placed an internal limit on the ability of the legislature to invoke s. 33 to shield legislation that undermines electoral fairness. OSSTF argued that this internal limit arose from: (i) the text of s. 33(3), (ii) the structural primacy of s. 3 in the Charter, and (iii) the norms and conventions for reforming election law affirmed by the unwritten principles of democracy and the rule of law.

The Court found Section 33(1) expressly exempted s. 3 of the Charter from the ambit of the notwithstanding clause. Section 3’s guarantee of rights was in full force and applicable to the legislation even though it contained the notwithstanding clause. Section 3 was either violated by the legislation or it was not. The scope and importance of the s. 3 rights cannot serve to restrict the operation of the notwithstanding clause regarding other rights to which the Charter says it did pertain.

OSSTF further argued that the Supreme Court’s decision in Ford was no longer an answer to the concerns it raised considering the evolution of Charter jurisprudence since Ford was decided in 1988. The Court noted that Ford had not been overruled or doubted by any subsequent Supreme Court decision. The core principles governing the interpretation and application of s. 33 in Ford must guide the review of s. 33. The notwithstanding clause was expressly and clearly invoked. The formal (and only) requirement for its invocation was complied with. The invocation will expire after five years, and the electorate will be able to consider the government’s use of the clause when it votes. And, as s. 3’s application to the legislation was unaffected by the invocation of the notwithstanding clause, the fact that it was validly invoked still left room for s. 3 to operate.

(2) Yes.

(a) The proper analytic framework under s. 3 of the Charter

(i) General Considerations
Section 3 should be read broadly and in view of the principles that underlie it. A citizen has a right to exercise their vote in an informed manner, which entails being reasonably informed of all electoral choices.

(ii) Section 3 protects the voter’s right to receive information in connection with elections

The analytical framework for a s. 3 challenge begins with a careful reading of the text. The reference in s. 3 to “[e]very citizen of Canada” having the right to vote in a provincial or federal election was directed toward participation in an election, as opposed to a right to lobby elected representatives or a free-standing right to engage in political discourse outside of elections. S. 3 protected the rights of individuals as voters in the electoral process, not the rights of third parties who hoped to communicate with voters.
OSSTF argued that the application judge incorrectly viewed voters as only “consumers” of political information, and not purveyors of it. OSSTF contended that the application judge erred by failing to situate the right to meaningful participation within the broader process of reciprocal political discourse, which is the bedrock of deliberative democracy.
The Elementary Teachers’ Federation of Ontario (“ETFO”) focused on the right to effective representation under s. 3. ETFO argued that the application judge incorrectly considered only the impact of the challenged spending restrictions on elections, and not the free flow of relevant information necessary for the proper functioning of the democratic process.
The Court did not accept that the scope of s. 3 was as broad as argued by OSSTF and ETFO. Any limit on third party spending would presumptively violate s. 3 on their reading of the scope of the voter’s right to relevant information.

Democracy Watch (“DW”) submitted that a s. 3 analysis should be alive to the important differences among third party advertisers themselves. DW highlighted that the egalitarian model was concerned about the undue influence that wealthy third parties may wield in the electoral process. Third parties, like the appellants, however, represented thousands of members who lacked resources to convey political information on their own and should not be subject to the same restrictions as a single or small group of wealthy businesses or individuals.

While the Court accepted that interpreting s. 3 within the egalitarian model required sensitivity to context, it did not accept that certain third-party advertisers conveyed information of higher value under s. 3 than others, or that the nature or make-up of third parties constitutionally required different treatment under the egalitarian model.

(iii) The egalitarian model and the informational component of the right to vote

The Court stated that under the “egalitarian model”, it is appropriate to limit third party spending more strictly than the spending of candidates and political parties. In a s. 3 analysis, one cannot start from the proposition that any limiting of third-party spending implies a breach of the right to vote in s. 3. Some level of spending limits is necessary to enhance the right to vote. The Supreme Court has made clear that there can come a point when a spending limit goes from being voting right-enhancing to being voting right-infringing.

(iv) When the informational component of s. 3 is infringed – the test and the proxies
In the Court’s view, what the appellants had to show to establish a violation of s. 3 was that the challenged spending restrictions limited information “in such a way as to undermine the right of citizens to meaningfully participate in the political process and to be effectively represented”. To determine whether the standard was violated, two proxies, or methods of ascertaining whether the restriction was constitutionally offside were laid down by Harper v. Canada (Attorney General) (“Harper”).

The first proxy was whether the restriction was “carefully tailored to ensure that candidates, political parties and third parties were able to convey their information to voters”, as opposed to being “overly restrictive”. The requirement that the restriction be carefully tailored in the sense necessary to determine whether s. 3 had been infringed must be viewed differently from minimal impairment. Unlike in a minimal impairment analysis, the appellants bore the burden of showing an absence of careful tailoring under s. 3. Similarly, in considering whether a s. 3 infringement had taken place, the careful tailoring analysis must not focus on whether a reasonable choice was made among alternatives that infringe the Charter right. Instead, the analysis must focus on whether an infringement had occurred at all. Therefore, the question was whether the challenged spending restrictions drew the line at the point of preventing the well-resourced from dominating political discussion without being overly restrictive to undermine the right of citizens to meaningfully participate in the political process and to be effectively represented. According to the Attorney General, the controlling legal test was whether the challenged spending restrictions limited information in such a way as to undermine the right of citizens to meaningfully participate in the political process and to be effectively represented.

The Court agreed with the Attorney General about the constitutional standard but disagreed that the reference to “carefully tailored” spending restrictions could be easily distinguished from the ultimate question of whether rights of citizens to meaningfully participate in the political process and to be effectively represented had been undermined. The two were inextricably linked as demonstrated by Bastarache J.’s use of the term “must” in relation to careful tailoring. In the Court’s view the use of the term “must”, indicated that careful tailoring was a consideration that the Court was to use in determining whether the constitutional standard – the voter’s right to meaningfully participate in the electoral process – had been violated. The application judge accepted that the challenged spending restrictions had to be carefully tailored within the meaning of Harper in order to be found consistent with s. 3. However, the Court found he erred in the way he conceptualized and applied that standard.
The second proxy in assessing whether the constitutional standard was met was the level of information campaigned that the restrictions would permit a third party to conduct. Harper recognized that nothing more be permitted than a “modest informational campaign”, as opposed to a campaign that would be capable of determining the outcome. The Court found the application judge erred in not making a finding that a modest informational campaign could be conducted.

The presence or absence of careful tailoring were not additional tests. They were considerations that must be used to inform whether the constitutional standard had been violated by spending restrictions because they “restrict information in such a way as to undermine the right of citizens to meaningfully participate in the political process and to be effectively represented”: Harper.

(b) The application judge erred in applying s. 3 to this case

(i) The required focus was the extension compared to the previous restrictions
The appellants contended that the application judge erred in the conclusions he reached on each of the proxies. They stressed that the application judge did not properly explain or justify how the challenged spending restrictions could be carefully tailored when he had previously (in Working Families 1) found them to be unnecessary to achieve electoral fairness, given that the previous restrictions accomplished the desired objective. The Court agreed that the failure of the application judge to focus on the significance of the extended restrictions brought about by the PEDDA re-enactments tainted his analysis.
The application judge was required to focus on the effect of the challenged spending restrictions re-enacted by PEDDA, given what had preceded them. Under the 2017 EFA provisions, a third party could spend unlimited amounts with a view to providing information to voters in the seventh to twelfth month before the election period, and a further $600,000 in the 6 months preceding it. That changed with Bill 254 and then PEDDA, which extended the restricted period to 12 months without increasing the spending limit.

The object of the PEDDA re-enactments was to restrict more severely what could be spent on political advertising in the 12-month pre-writ period than was the case under legislation in effect since 2017 (leaving aside the constitutionally invalid 2021 amendments struck down in Working Families 1). Since the definition of political advertising embraces advertising to voters to promote or oppose party leaders, parties, or the election of a candidate, and includes taking a position on issues with which any of them are closely associated, the goal of PEDDA was clearly to restrict information more severely being provided to voters than had previously been the case.

The Court concluded that the significance of the additional 6 months of restricted spending should have been the focus of the enquiry. Given that the PEDDA re-enactments were designed to restrict the ability of third parties to convey information to voters about whom they should vote for, and about the issues those vying to be their representatives were associated with, the operative question concerned the effect of the increased restrictions, considering what had preceded them.

(ii) The application judge’s error with respect to “careful tailoring”

The Court found the application judge made three errors in his analysis of careful tailoring. First, he failed to apply his findings from Working Families 1 that bore on the question of careful tailoring that was raised with respect to the challenged spending restrictions. Second, he divorced the length of the spending restrictions from their quantum, which had to be considered together. Third, he conflated the approach to careful tailoring required in a s. 3 analysis with a different and inapplicable analysis by his reference to the impugned legislation being “one of a number of reasonable alternatives”.

In the face of the application judge’s findings in Working Families 1 as to the lack of justification for the changes to third party advertising restrictions, on which the appellants now relied for a different purpose, and no new intervening evidence produced by the Attorney General in Working Families 2 to counter this finding, the Court concluded that the challenged spending restrictions could not be said to have been carefully tailored. Careful tailoring was only one of two proxies that a court should consider in deciding whether a violation of the constitutional standard had occurred.

(iii) The application judge made no finding that a modest informational campaign could be mounted

The Court found that the application judge focused on the appellants’ position that the challenged spending restrictions would impair their ability to conduct a multimedia persuasive campaign. He referred to the appellants’ expert, SF, who testified that a “minimally effective”, two-week advertising campaign would cost at least $1.2 million, but where effective was measured by the ability to change voter behaviour. The application judge concluded that s. 3 did not entitle third party advertisers to mount campaigns that would persuade or influence voters. However, after Harper, the question was whether the challenged spending restrictions permitted a modest informational campaign. He did not go on to consider whether any evidence allowed him to conclude that they did.

The Court further found that the application judge did not refer to evidence in the record before him in this regard. Rather, he referred to the Supreme Court’s decision in Harper, where Bastarache J. commented that “third parties [can] engage in a significant amount of low-cost forms of advertising”. That comment from Harper, however, was grounded in the evidentiary findings made at trial in that case. As a result, the Court held that the application judge’s observations about low-cost methods of advertising did not adequately address the question of whether a modest informational campaign could be mounted. The modest informational campaign had to be one that could be mounted given the 12-month restricted period. The fact that the Attorney General points to no evidence that a modest informational campaign could be mounted within the challenged spending restrictions was telling on the ultimate question.

Adopting the reasoning from Harper, the Court concluded that because the challenged spending restrictions were not carefully tailored, and there was no finding that they would permit a modest informational campaign, they overly restricted the informational component of the right to vote. They therefore undermined the right of citizens to meaningfully participate in the political process and to be effectively represented. Consequently, the Court found they infringed s. 3 of the Charter.

(3) No.

The Court noted that in this case the Attorney General did not argue that if a s. 3 violation were found, it was justified under s. 1. Nonetheless, the Court considered the issue. Having found an infringement of the right to vote, the burden was on the Attorney General, under the first two prongs of the Oakes test, to establish that this extension of the duration of the restricted period, together with the unchanged spending limits, furthered a pressing and substantial objective by means rationally connected to achieving that purpose. Since there was no evidence that the challenged spending restrictions were necessary to accomplish anything toward securing the egalitarian model of elections that was not already accomplished by the restrictions in effect prior to 2021, the Court concluded that they were not minimally impairing of the s. 3 rights in issue. The Court endorsed the statement by the application judge from Working Families 1, that “[a] 12-month impairment is twice as long, and twice as restrictive, as a 6-month impairment, and so by definition is not minimal.” The Court was also not satisfied on the final prong of the Oakes test, namely proportionality, that the benefits of the challenged spending restrictions were worth the cost of the rights limitations. No benefits were identified as flowing from extending the duration of the spending limits while freezing their quantum.

Dissenting Decision of Benotto J.A.

(1) No.

Justice Benotto agreed with the majority that s. 33 was properly invoked by the application judge.

(2) No.

Justice Benotto disagreed with the majority of the Court’s finding that the application judge erred by finding no s. 3 infringement. In particular, she did not agree with the inferences drawn from Harper by the majority. With respect to the two proxies created by Harper, Benotto J. disagreed with the meaning ascribed to the first proxy and did not agree that the second was followed.

Harper begins with the basic proposition that spending limits are necessary and enhance the right to be an informed voter. Without spending limits, it is possible for the affluent or a number of persons or groups to dominate the electoral discourse. The controlling test is not whether the spending limits are carefully tailored but whether they restrict information in such a way to undermine the right of citizens to meaningfully participate in the electoral process, which includes the right to vote in an informed manner.

Justice Benotto criticized the majority’s inference that the careful tailoring requirement invites the court to consider justification at the s. 3 stage of analysis because it conflates the s. 3 analysis with the s. 1 analysis. The s. 3 analysis does not require an inquiry into why the government enacted spending limits but rather the inquiry should be focused on whether the spending limits restrict information in a way that undermines the right to meaningfully participate in the electoral process. Benotto J. held that this was how the application judge approached the s. 3 analysis and that the application judge was correct in doing so.
Benotto J. found that the majority focused on the words ‘carefully tailor’ without adequate recognition of the words that explain the purpose of the careful tailoring, which is “to ensure that candidates, political parties and third parties are able to convey their information to voters.” Justice Benotto found that the application judge did not err by focussing on extended restrictions because the application judge: (1) recognized the importance of the extension; (2) correctly considered the legislation before him and whether it would stand or fall on its own; and (3) was entitled to accept the respondent’s expert evidence.

Justice Benotto did not agree that the application judge concluded that the spending restrictions were “in some other sense ‘reasonable’”, as the majority suggested. Instead, the application judge’s reference to “reasonable” was made in the context of discussing the expert evidence and he determined that the restrictions were aimed at promoting the egalitarian model and citizens could still cast an informed vote.

Justice Benotto further disagreed that the appellants were entitled to rely on findings made in a different case with a different analytic structure, and that as a result the application judge properly recognized that he was required to make findings in this case through a different legal lens than in Working Families 1. Ultimately, Justice Benotto concluded that the application judge did not err in how he approached the analysis and applied the correct legal analysis with no palpable and overriding errors.

Regarding the second proxy from Harper, Benotto J. found that the application judge did not fail to make a specific finding, as the majority found, but rather that the application judge made a finding that the legislation permits a modest informational campaign. Justice Benotto did not agree that the application judge’s reasons were ambiguous, but even if they were, R. v. G.F. instructs that the interpretation consistent with the presumption of correct application must be preferred over those that suggest error. Benotto J. was satisfied that the application judge followed the directives in Harper and made findings open to him on the evidence.

(3) As Justice Benotto found that s. 3 of the Charter was not infringed, it was unnecessary to consider whether the infringement could be saved under s. 1.

Fockler v. Speigel, 2023 ONCA 148

[Zarnett, Thorburn and Copeland JJ.A.]

Counsel:

R. Fockler and L. Cartwright, acting in person
K. Preston, for the respondents J. Speigel and Lawyers’ Professional Indemnity Company
B. Martin, for the respondent G. Kassabian

Keywords: Solicitor and Client, Negligence, Civil Procedure, Summary Judgment, Limitation Periods, Appeals, Fresh Evidence, Limitations Act, 2002, S.O. 2002, c. 24, ss. 4-5, Rules of Civil Procedure, rr. 37.14, r. 59.06, Waite v. Gershuny (2005), 194 O.A.C. 326 (Div. Ct.), Dass v. Kay, 2021 ONCA 565, Palmer v. The Queen, [1980] 1 S.C.R. 759

facts:

In August 2015, the appellants retained the respondent, GK, to act for them on the sale of their house in Toronto. There were a number of writs of execution that affected the property and that needed to be removed to complete the sale.
Three of the executions affecting the property were in favour of the respondent, Lawyers’ Professional Indemnity Company (“LawPRO”). On the closing of the sale on November 5, 2015, GK caused $13,386.97 to be paid out of the closing proceeds to LawPRO’s lawyers to obtain a release of the LawPRO writs of execution.

On April 12, 2018, the appellants commenced an action against the respondents. Their action alleged that GK did not make them aware before closing that LawPRO was demanding payment of legal costs on top of principal and interest and claimed that, in paying $7,427.39 for legal costs and disbursements to obtain the release of the LawPRO writs, he acted without instruction or authority and was professionally negligent. The action also claimed that LawPRO and its lawyer, the respondent JS, engaged in extortion to obtain that payment and have been unjustly enriched by it.

In December 2020, the respondents moved for summary judgment dismissing the action. A ground they relied on was that the action was commenced after the expiry of the limitation period. The appellants did not participate in the Zoom hearing and material they served and filed the day prior was not before the judge.

The summary judgment motion judge dismissed the action. In June 2021, the appellants launched a motion to set aside the summary judgment dismissing their action. They relied on rr. 37.14 and 59.06 of the Rules of Civil Procedure.

The motion to set aside was dismissed by Cameron J., as she was not satisfied that the appellants had reasonably explained their absence from the May 18 hearing, i.e. that they were not “Zoom ready”. Second, she found that the appellants’ claim lacked arguable merit because it was barred by the limitation period. As for the relief claimed under r. 59.06, the motion judge considered there to be no basis to find the summary judgment had been obtained by fraud.

issues:

(1) Did the motion judge err in finding that the appellants had not reasonably explained their failure to participate in the summary judgment motion?
(2) Did the motion judge err in finding that the appellants’ action was barred by the expiry of the limitation period?
(3) Are the appellants entitled to introduce fresh evidence on appeal?

holding:

Appeal dismissed.

reasoning:

(1) and (2) No.

The Court held that it was not necessary to deal with the first issue. The Court held that the second issue dispensed with the appeal, as there was no reversible error in the motion judge’s finding that the appellant did not have an arguable claim because the action was statute-barred.

The Court noted that the appellants had received a reporting letter in November of 2015. This letter established the basis for the appellants’ claim. The Court agreed with the motion judge’s finding that the limitation period began to run in November of 2015 despite the appellants’ claims that they did not review the letter until May of 2016.

The Court held that the test for when a limitation period begins to run is when the claim was discovered, which is the earlier of when the appellants actually discovered the claim or when a reasonable person with the abilities and circumstances of the appellants ought to have discovered it. The Court agreed with the motion judge that a reasonable person would have discovered the claim within a few days of closing November 5, 2015.

The Court held that it was open to the motion judge on the record to find that a reasonable person engaged in a real estate sale would have promptly reviewed the information about how the closing funds had been deployed to pay off executions. Accordingly, the Court found no basis to interfere with the motion judge’s findings.

(3) No.

The Court also rejected the motion for fresh evidence by the appellants. The Court was not satisfied it met the test in Palmer v. The Queen. Specifically, the Court held that the evidence failed to satisfy the first and fourth elements of the Palmer test. The first element is a due diligence requirement. The Court stated that, if by due diligence, the evidence could have been adduced at the hearing below, the evidence should not generally be admitted. The Court found there was no explanation as to why the evidence could not be provided to the motion judge.

The Court also found that the fourth element of the test was not met, that the evidence could be expected to have affected the result. The Court found that the fresh evidence largely repeated what the appellants had previously noted about the reporting letter.

Children’s Aid Society of London and Middlesex v. T.E., 2023 ONCA 149

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

Counsel:

J. Gagne, for the appellant, T.M.
R.C. Hammond, for the respondent Children’s Aid Society of London and Middlesex
A.J.P. Tremain, for the respondent T.E.
K. Hensel, D. Snider and K. Tsang, for the respondent J.G.
N. Hill-Dolson, for the respondent L.D. (on behalf of Oneida Nation of the Thames)
T. Law, for the respondent O.T.
S. Clarke, for the intervenor Association of Native Child and Family Services Agencies of Ontario

facts:

The appellant is the child’s kin caregiver. The respondents are the child’s biological mother (“TE”), biological father (“JG”), the child’s aunt (“OT”), and the Oneida Nation of the Thames (“Oneida”). The Children’s Aid Society of London and Middlesex (the “Society”) have been involved with the child since her birth and commenced protection proceedings when she was two months old.

Following a series of unsatisfactory placements, when the child was about six months old, the child was placed with the appellant, who acted as kin caregiver. An order was made granting the appellant temporary custody under the supervision of the Society.
Several months later, the appellant brought a motion seeking to be added as a party to the protection proceedings. At about the same time, JG brought a motion seeking to have the proceedings withdrawn because the respondents were planning to sign a customary care agreement with OT. By the time the motions were heard, the Customary Care Agreement (the “CCA”) had been signed. It did not include the appellant, nor did it make any provision for her continued access to, or involvement with, the child.

Relying primarily on the CCA, the motion judge granted JG’s motion to dismiss. The motion judge found no technical defects in the CCA. After making this determination, the motion judge dismissed the appellant’s motion to be added as a party. The motion judge considered the discretion afforded to the court by rule 7(5) of the Family Law Rules (the “Rules”), wherein the Court “may order that any person who should be a party shall be added as a party”. The motion judge concluded that to add the appellant as a party would add considerable time to the proceedings – it would change a resolved proceeding into a protracted, conflicted proceeding.

issues:

(1) Did the motion judge err in refusing to grant party status to the appellant?
(2) Did the motion judge err by determining the motion to dismiss before considering the issue of party status?
(3) Did the motion judge err by dismissing the protection proceedings?

holding:

Appeal allowed.

reasoning:

(1) Yes.

The Court allowed the appellant’s motion for party status because the motion judge erred in considering only discretionary party status under rule 7(5) of the Rules. The Court found that the motion judge failed to address the provincial and federal legislation. Accordingly, the Court turned to the Child, Youth and Family Services Act (the “CYFSA”), which defines a “parent” in section 74(1) and sets out the criteria for party status in child protection applications in section 79(1). Although the CYFSA excludes foster parents, the Court found that the motion judge erred in determining that the appellant was a foster parent. The Court found that once the appellant became the child’s kin caregiver, she was no longer a foster parent. As such, the appellant, who, at the time of the motion, had “lawful custody of the child”, an order for access to the child, and was not a “foster parent”, met the definition of “parent” in s.74(1) of the CYFSA and so had a statutory entitlement to party status pursuant to s.79(1).

(2) Yes.

The Court held that the child protection proceeding should not have been dismissed before determining who the parties were. However, since the Court had already determined that the appellant should have been a statutory party and that the CCA had to be evaluated by the Court before dismissing the protection proceeding, the Court found that nothing turned on the order of determination.

(3) Yes.

The Court found that the motion judge erred in dismissing the proceedings by simply basing his decision on the existence of the CCA. Although there is no direct statutory provision for customary care agreements, the Court recognized that they are an important vehicle by which parties resolve issues relating to First Nations, Inuit and Métis children in care. However, the Court clarified that this does not mean their role is eliminated. In every child protection case, the Courts have an obligation to promote the best interests of the child. The Court turned to M.L. v. Dilico Anishinabek Family Care, which stressed the need for all parties to participate in the plan for customary care. In this case, the Court found that the appellant was not involved in the customary care plan, nor was she a party to the CCA. Accordingly, the Court held that the motion judge failed to consider the best interests of the child by not considering the possible effects the child may have face in having their continuity disrupted.

Grimm v. Ontario (Children’s Lawyer), 2023 ONCA 161

[Roberts J.A. (Motion Judge)]

Counsel:

J. Rechtshaffen, for the moving party
DS, in person

Keywords: Family law, Parenting, Civil Procedure, Appeals, Security for Costs, Frivolous and Vexatious,Courts of Justice Act, R.S.O. 1990, c. C.43, s. 133(b), Rules of Civil Procedure, r. 61.06, Yaiguaje v. Chevron Corporation, 2017 ONCA 827, Schmidt v. Toronto-Dominion Bank (1995), 24 O.R. (3d) 1 (C.A.), R. v. R. (2002), 58 O.R. (3d) 656 (C.A.), A.G.L. v. K.B.D (2009), 93 O.R. (3d) 409 (S.C.), Barresi v. Jones Lang Lasalle Real Estate Services Inc., 2019 ONCA 884, McNaughton Automotive Limited v. Co-Operators General Insurance Company (2008), 95 O.R. (3d) 365 (C.A.), Brad-Jay Investments Ltd. v. Szijjarto, 218 O.A.C. 315 (2006) (C.A.), Hamilton v. Open Window Bakery Ltd., 2004 SCC 9

facts:

The parties were married for almost 15 years before they separated on September 30, 2016. They have three children, aged 20, 17 and 14. The underlying dispute involved a successful summary judgment motion in favour of the wife for final decision-making authority and parenting time. The husband appealed the summary judgment decision and sought leave to appeal the costs award. The wife moved for security for costs on the grounds that the appeal was frivolous and vexatious and that the husband had insufficient assets to pay costs in the event that his appeal was unsuccessful.

Except for a handful of unsuccessful attempts at supervised access by the husband, the children have not had contact with their father since September 30, 2016. The children have consistently indicated through the Office of the Children’s Lawyer that they did not wish to have any further contact with their father or members of his family.

Prior to the summary judgment hearing, a case conference was held and Pinto J. ordered a timetable for the parties’ delivery of materials. The father did not file his materials by the court-ordered deadline. The father’s request to file material late was refused. Summary judgment was granted for three reasons: (1) the father did not take steps to bring the protracted litigation to an end, (2) the father did not put his best foot forward and provide evidence to “counter the significant allegations of family violence”, and (3) it was in the best interest of the children to bring the litigation to an end.

issues:

Should the Court order that the father pay security for costs of his appeal?

holding:

Motion granted.

reasoning:

Yes.

Security for costs of an appeal can be ordered where there is good reason to believe that the appeal is frivolous and vexatious and that the appellant has insufficient assets in Ontario to pay the costs of the appeal or where the justness of the case demands it.
The Court stated that the father’s lack of objection to the relief sought by the mother on summary judgment was fatal to his appeal. Further, the lack of objection was never contradicted through affidavit evidence or the notice appeal.

The Court further noticed that the father’s grounds of appeal, which centered around parenting time, had no real prospect of success. His grounds of appeal related to the motion judge’s refusal to consider his material, which would have negated allegations in the mother’s materials. However, he identified no reversible error in the motion judge’s exercise of his discretion in light of his factual conclusion that the father failed to abide by the court-ordered deadline for the delivery of his materials. The Court further noted that, based on the motion judge’s analysis of the father’s submissions and in light of his lack of objection to the relief sought by the mother, it was reasonable to conclude, as the motion judge did, that the materials would not have made any difference to the outcome.

The father also argued that the motion judge failed to consider the children’s ages as a determining factor “in access and custody”. The Court found no merit to this ground and stated that the age of the children was not determinative and the cases cited by the father did not support his argument.

The Court held that there was also good reason to believe that the ground of appeal regarding the costs award was also frivolous and vexatious. The Court reiterated that the test for leave to appeal a costs award is high. A costs award should be set aside on appeal only if the motion judge made an error in principle or if the costs award was plainly wrong. The father identified no error in the motion judge’s discretionary costs order. As the successful party, the mother was entitled to costs. The Court held that the amount awarded appeared fair, reasonable and proportionate.

Lastly, the mother argued that the father has insufficient assets to pay the costs of appeal if unsuccessful on the basis of a 2017 financial statement that was sworn in the family law proceedings. The father argued that this evidence was dated and that he now has sufficient assets. However, if the father disagreed with his own sworn 2017 statement, it was incumbent on him to provide current evidence of his financial circumstances. He failed to do so. Accordingly, the Court held that it was in the interests of justice to order the requested security for costs.

Niagara Falls Shopping Centre Inc. v. LAF Canada Company, 2023 ONCA 159

[Gillese, Tulloch and Roberts JJ.A.]

Counsel:

J. Haylock and E. Young, for the appellants
H. Pitch and A. Brunswick, for the respondent

facts:

LAF Canada Company (the “Tenant”) leased property from Niagara Falls Shopping Centre Inc. (the “Landlord”) to operate a fitness facility (the “Club”). On March 17, 2020, the Ontario government declared a provincial state of emergency due to the COVID-19 pandemic. On March 24, 2020, the government mandated the closure of all non-essential workplaces, including fitness facilities. The resulting restrictions either prevented the Tenant from opening the Club or allowed it to open subject to capacity limits.

In May 2020, the Landlord and the Tenant entered into a rent deferral agreement that provided limited rent relief from April to June 2020. Pursuant to that agreement, 50% of the base rent was forgiven and 25% was deferred. After the rent deferral agreement expired, the Tenant paid rent until the end of 2020, even though the Club was permitted to re-open only with limited capacity. When the Ontario government re-imposed the lockdown on December 26, 2020, the Tenant refused to continue paying rent. The Landlord responded by bringing an action for all unpaid rent and various associated charges. The Tenant defended, contending that it was under no legal obligation to pay rent during the government-mandated closures due to the Force Majeure Clause. The Tenant also counterclaimed for a declaration that: (1) during periods of government-mandated closure of the Club, it was relieved of the obligation to pay rent; and (2) during periods of government-mandated capacity limits for the Club, its obligation to pay rent was reduced in proportion to those restrictions.

The motion judge accepted that the government lockdowns were “restrictive laws” and, therefore, the Force Majeure Clause was triggered. However, she held that the Force Majeure Clause did not require the lease to be extended for a period equivalent to the closures because it was intended to deal with only a time limited event in the lease, such as a maintenance repair. Furthermore, the motion judge accepted the Landlord’s argument that the Tenant was not relieved of its obligation to pay rent during those same periods because the Force Majeure Clause stated that failures to perform that could be cured by the payment of money were not Force Majeure Events, and the failure to pay rent could be cured through payment.

issues:

(1) What is the appropriate standard of review regarding the motion judge’s interpretation of the Force Majeure Clause?
(2) Did the motion judge make an extricable legal error in interpreting the Force Majeure Clause?
(3) Did the motion judge err in determining that the Tenant was required to pay rent during the excused period?

holding:

Appeal allowed, in part.

reasoning:

(1) The deferential standard was applied.
The Tenant argued that the standard of review of the motion judge’s interpretation of the Force Majeure Clause was correctness because the lease was a standard form contract. The Landlord disagreed, submitting that there was no evidence that the lease was offered by either party on a “take it or leave it” basis. Rather, the Landlord argued that the standard of review was palpable and overriding error: Sattva Capital Corp. v. Creston Moly Corp.

The Court disagreed with the standard of review proposed by both parties. It noted that the interpretation of a non-standard form contract is a question of mixed fact and law, which attracted the deferential standard of review. Absent an extricable legal or a palpable and overriding error, appellate intervention was not warranted.

(2) Yes.

The motion judge concluded that the Force Majeure Clause exempted the Landlord from performance for the periods of delay caused by the closures. The Tenant accepted that the delays in performance by the Landlord were excused for the delay periods but contended that the Force Majeure Clause required the lease to be extended for an equivalent period because it stated that “performance of such act shall be excused for the period of delay caused by the Force Majeure Event and the period for the performance of such act shall be extended for an equivalent period (the “Excusing Provision”). The motion judge rejected this contention, saying such a result was “commercially absurd” and the extension referred to in the Excusing Provision was intended to deal with a time limited event.

The Court held that the motion judge committed two extricable legal errors in interpreting the Force Majeure Clause. First, she failed to give the words in the Excusing Provision their ordinary and grammatical meaning. She interpreted the word “excused” as “exempted” and ignored the part of the Excusing Provision which sets out how the excused performance is to be dealt with. There was nothing in the Force Majeure Clause or the Excusing Provision that exempted the Landlord from its obligation to perform. Rather, the Excusing Provision expressly provided for what was to happen if a party was delayed, hindered in, or prevented from performing a required act under the lease as a result of a Force Majeure Event.

Second, the motion judge erred in limiting the operation of the Excusing Provision to “time limited events”. The Court found nothing in the Force Majeure Clause that would support such limitation. To the contrary, it stated that performance was to be excused for an amount of time equivalent to the amount of time where the Force Majeure Clause was in operation. By limiting the operation of the Excusing Provision to obligations only of a time-limited nature, the motion judge both ignored the plain wording of the Force Majeure Clause and imposed a limitation contrary to the parties’ agreement as expressed therein.

(3) No.

The Force Majeure Clause operated to excuse the Landlord’s failure to provide the Tenant with the Premises during the government-mandated closure periods and extend the lease by the amount of time that the Force Majeure Event was in effect.

The Tenant argued that this Force Majeure Clause also operated to excuse it from its obligation to pay rent during the excused period. The Court agreed with the motion judge that the Tenant was obligated to pay rent during this time period. While the Tenant’s ability to pay rent was hindered, this was not because of a Force Majeure Event. The Force Majeure Clause excluded financial inability to pay as a Force Majeure Event. The Tenant was, in fact, unable to pay because it refrained from charging its members membership fees during the lockdown. However, the Court clarified that the Tenant was not obligated to pay rent during the extension period, having already been required to pay it during the closure periods.

SHORT CIVIL DECISIONS

Rivas v. Anobile, 2023 ONCA 156

[Roberts, Nordheimer and Favreau JJ.A.]

Counsel:

D. LaFramboise, for the appellant
D. Saverino, for the respondent

Keywords: Family Law, Matrimonial Home, Trust Property, Fraud, Breach of Fiduciary Duty

908593 Ontario Limited v. Atradius, 2023 ONCA 156

[Roberts, Nordheimer and Favreau JJ.A.]

Counsel:

D. M. O’Leary and M. Muñoz, for the appellant
S. Sasso, for the respondent

Keywords: Bankruptcy and Insolvency, Receiverships, Contracts, Insurance, Interpretation, Standard of Review, Palpable and Overriding Error, Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co., 2016 SCC 37, [2016] 2 S.C.R. 23, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Hemlow Estate v. Co-operators General Insurance Company, 2021 ONCA 908, Apps v. Grouse Mountain Resorts Ltd., 2020 BCCA 78, Crosby (Estate) v. Native Fishing Assoc., 2001 BCCA 118, Chilton v. Co-Operators General Insurance Co. (1997), 32 O.R. (3d) 161 (C.A.)

Tiwari v. Singh, 2023 ONCA 163

[Roberts, Nordheimer and Favreau JJ.A.]

Counsel:

A. S. Nagpal, for the appellants
R. Datt, for the respondent

Keywords:Real Property, Mortgage, Civil Procedure, Summary Judgment, Evidence, Admissibility, Hearsay, Documents, Authenticity Rules of Civil Procedure, r. 20.02(1), Sweda Farms Ltd. v. Egg Farmers of Ontario, 2014 ONSC 1200

Buffone v. Sokil, 2023 ONCA 168

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

Counsel:

BLS, appearing in person
C. S., for the responding party BMO Trust Company, in its capacity as Estate Trustee During Litigation of the Estate of EB
WS, appearing in person
R. Jennings, for the responding party EAB

Keywords: Wills and Estates, Civil Procedure, Contempt, Appeals, Stay Pending Appeal, Carey v. Laiken, 2015 SCC 17, [2015] 2 S.C.R. 79, Belton v. Spencer, 2020 ONCA 623

Hill v. Cambridge (City), ONCA 2023 164

[Roberts J.A. (Motion Judge)]

Counsel:

SH, in person
J.H. Bennett, for the City of Cambridge and the Region of Waterloo, KH and SM
R. Rammaya, for J. Lem, Director of Land Titles
V. Crystal, for the Assessment Review Board
N. Roberts and R. Shah, for Gateway Business Campus, Suncor Energy Inc. and AH
P. Betts and L. Onayemi, for Sun Life Assurance Company of Canada
P. Le Vay, for the Law Society of Ontario and Estate of GV
S.D.E. Matheson, for the Estate of EW
E.C. Durst, for the respondents, 4928548 Ontario Limited, SP and Poladian Holdings Inc.
A. Amster, for the Municipal Property Assessment Corporation

Keywords: Civil Procedure, Vexatious Litigants, Appeals, Extension of Time, Rules of Civil Procedure, r. 2.1.01(1), Sabatino v. Posta Ital Bar Inc., 2022 ONCA 208

COURT OF APPEAL SUMMARIES (February 27, 2023 – March 3, 2023)

By John Polyzogopoulos on March 4, 2023

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

Good evening.

Following are this week’s summaries of the civil decisions of the Court of Appeal for Ontario for the week of February 27, 2023. It was a busy week at the Ontario Court of Appeal with many lengthy decisions released.

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In Ontario (Attorney General) v. Trinity Bible Chapel, the appellants were charged with contravening several of Ontario’s COVID-19 regulations imposing capacity restrictions on indoor and outdoor religious gatherings in late 2020 and early 2021. The appellants brought motions to set aside court orders made against them on the basis that the authorizing regulations infringed s. 2 of the Canadian Charter of Rights and Freedoms. The motion judge found the challenged regulations infringed the appellants’ right to freedom of religion under s. 2(a) of the Charter but were justified as a reasonable limit on that right in a free and democratic society. The appellants challenged the motion judge’s treatment of the expert evidence, her decision not to rely on “hindsight” evidence in evaluating the regulations, her decision not to consider the other alleged Charter breaches, and her conclusion that the regulations were justified under s. 1. The Court dismissed the appeal and found the motion judge was entitled to rely on all, part, or none of the expert evidence. The Court also saw no error in the motion judge’s overall conclusion that the challenged regulations were justified under s. 1 of the Charter.

In Park Lawn Corporation v. Kahu Capital Partners Ltd. the Court considered an appeal from a motion judge’s decision refusing to strike the respondent’s counterclaim for defamation in an Anti-SLAPP motion. The Court agreed with the motion judge that the public comments made about the respondent harmed the respondent’s reputation. Further, the Court found that the motion judge had correctly weighed the public interest of the comments against the corresponding harm that they caused. Finally, the Court agreed that the anti-SLAPP motion was inspired by strategic and tactical decisions and accordingly refused the appeal.

The Court in Sinclair v. Amex Canada Inc. considered whether the motion judge had erred in applying the fourth factor of the Van Breda test of whether a contract connected with the dispute was made in Ontario. The majority of the Court found that the motion judge had erred by failing to consider each objecting defendants’ position in disputing jurisdiction. In other words, the motion judge erred in accepting that because one defendant did not object to the jurisdiction of Ontario, all defendants were subject to the same jurisdiction. The Court further found that the motion judge had erred in failing to find that, in the event there was a presumptive connecting factor, the appellants had failed to rebut it. Young J.A. provided a concurring decision. Young J.A. disagreed with the majority that the Ontario contract could not connect all of the appellants to Ontario. However, Young J.A. agreed that the motion judge had erred in failing to find that the presumptive connection was rebutted by the appellants.

In Burr v. Tecumseh Products of Canada Limited, the respondents started an action against Venmar and Fasco for a defective ventilator that overheated, exploded and caught fire resulting in serious damage. The ventilator was manufactured and designed by Venmar and the motor was designed and manufactured by Fasco. The trial judge had found Venmar liable for negligent design and that Fasco was entitled to be indemnified by Venmar pursuant to their contract. The Court found that the trial judge did not make any palpable or overriding error and committed no legal error in his conclusions that Venmar was liable for negligent design despite not finding Venmar not liable for its duty to warn the respondents. The Court also held that the trial judge reasonably concluded that the indemnity provision in the contract was operative, such that if Fasco had been liable to the respondents, Venmar was contractually bound to indemnify Fasco for any damages payable to the respondents. However, the Court found that the trial judge failed to take into account the indemnity provisions in the contract when exercising his discretion on costs and remitted the issue of costs payable to Fasco to the trial judge.

Other topics this week include a request for leave to appeal from a motion judge’s order made under Companies’ Creditors Arrangement Act proceedings, an appeal from a motion judge’s decision refusing to strike a counterclaim for defamation in an Anti-SLAPP action, a motion to the Court alleging reasonable apprehension of institutional bias, seeking to disqualify the panel of the Court from hearing any matter related to the ongoing appeals related to the trees at Osgoode Hall, among others.

Wishing everyone an enjoyable weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Ines Ferriera
Blaney McMurtry LLP
416.597.4895 Email

Civil Decisions

Sinclair v. Amex Canada Inc., 2023 ONCA 142

Keywords: Tort, Negligence, Personal Injury, Liability, Contract, Jurisdiction, Jurisdiction simplicitor, Presumptive Connecting Factors, Real and Substantial Connection, forum non conveniens, Rules of Civil Procedure, R.R.O. 1990, Reg. 194, r. 11.25 (3)(b), Alberta Rules of Court, Alta Reg. 124/2010, Court Jurisdiction and Proceedings Transfer Act, S.B.C. 2003, c. 28, Jean-Gabriel Castel & Janet Walker, Castel & Walker: Canadian Conflict of Laws, loose-leaf (2022-Rel. 96), 6th ed. (Markham, ON: LexisNexis Canada, 2005), Club Resorts Ltd. v. Van Breda, 2012 SCC 17, Hydro Aluminium Rolled Products GmbH v. MFC Bancorp Ltd., 2021 BCCA 182, Lapointe Rosenstein Marchand Melançon LLP v. Cassels Brock & Blackwell LLP, 2016 SCC 30, Bazley v. Curry, [1999] 2 S.C.R. 534, Kyko Global Inc. v. M/S Crawford Bayley & Co., 2021 ONCA 736, Vahle v. Global Work & Travel Co. Inc., 2020 ONCA 224, Dilkas v. Red Seal Tours Inc. (Sunwing Vacations), 2010 ONCA 634, Di Gregorio v. Sunwing Vacations Inc., 2018 ONCA 655, R. v. Mian, 2014 SCC 54, Quan v. Cusson, 2009 SCC 62, Hydro Aluminium Rolled Products GmbH v. MFC Bancorp Ltd., 2021 BCCA 182, Sakab Saudi Holding Company v. Jabri, 2022 ONCA 496, Forsythe v. Westfall, 2015 ONCA 810, Tamminga v. Tamminga, 2014 ONCA 478, Gajraj v. DeBernardo (2002), 60 O.R. (3d) 68 (C.A.), Doyle v. Zochem Inc., 2017 ONCA 130, Hague v. Hague, 2022 BCCA 325, R. v. G.F., 2021 SCC 20, Dreesen v. Dreesen, 2021 ONCA 557, Kringhaug v. Men, 2022 BCCA 186, Henderson v. The Manitoba Public Insurance Corporation, 2022 MBCA 57, Zhao v. Fang, 2022 BCCA 227, Flying Frog Trading Co., Ltd. v. Amer Sports OYJ, 2018 BCCA 384, Saskatchewan Power Corporation v Mitsubishi Power Canada Ltd., 2022 SKQB 147, Toews v. Grand Palladium Vallarta Resort & Spa, 2016 ABCA 408, Mantini v. Smith Lyons LLP (2003), 64 O.R. (3d) 505 (C.A.), Lawrence v. Toronto Humane Society (2006), 271 D.L.R. (4th) 329 (Ont. C.A.), Kitchener-Waterloo Real Estate Board Inc. v. Ontario Regional Assessment Commissioner, Region No. 21 (1986), 56 O.R. (2d) 94 (H.C.), Toews v. First Choice Canada Inc (Signature Vacations), 2016 ABQB 130, Slattery (Trustee Of) v. Slattery, [1993] 3 S.C.R. 430, Nowegijick v. The Queen, [1983] 1 S.C.R. 29, Colavecchia v. The Berkeley Hotel, 2012 ONSC 4747

Johwel Investments Inc. v. Welton, 2023 ONCA 132

Keywords: Real Property, Property Rights and Interests, Trust, Bare Trustee, Judgment Creditor, Trident Holdings Ltd. v. Danand Investments Ltd. (1988), 64 O.R. (2d) 65 (C.A.), John Sopinka, Mark A Gelowitz and W. David Rankin, Sopinka and Gelowitz on the Conduct of an Appeal, 4th ed. (LexisNexis, 2018, Toronto), at §1.11

Haudenosaunee Development Institute v. Metrolinx, 2023 ONCA 144

Keywords: Property Rights, Expropriation, Infrastructure, Municipal Law, Heritage Properties, Osgoode Hall, Civil Procedure, Interim and Interlocutory Injunctions, Reasonable Apprehension of ‘Institutional Bias’, Jurisdiction, Appeals, Leave to Appeal, Courts of Justice Act, R.S.O. 1990, c. C. 43, s. 6(1)(b), s. 7(5), s. 19(1)(b), s. 101, Law Society of Ontario v. Metrolinx, 2023 ONSC 1169, Committee for Justice and Liberty v. National Energy Board, [1978] 1 S.C.R. 369, Yukon Francophone School Board, Education Area #23 v. Yukon (Attorney General), 2015 SCC 25, Cojocaru v. British Columbia Women’s Hospital and Health Centre, 2013 SCC 30, Paulpillai Estate v. Yusuf, 2020 ONCA 655, Drywall Acoustic Lathing Insulation Local 675 Pension Fund v. SNC-Lavalin Group Inc., 2020 ONCA 375, Hendrickson v. Kallio, [1932] O.R. 675, Ball v. Donais (1993), 13 O.R. (3d) 322 (C.A.), Prescott & Russell (United Counties) v. David S. Laflamme Construction Inc., 2018 ONCA 495, Soberman Isenbaum Colomby Tessis Inc. v. St. James Securities Inc. (2002), 60 O.R. (3d) 155 (C.A.), Ontario v. Shehrazad Non-Profit Holding Inc., 2007 ONCA 267, Amphenol Canada Corp. v. Sundaram, 2019 ONCA 932, Ontario Medical Association et al. v. Miller (1976), 14 O.R. (2d) 468 (C.A.), Deltro Group Ltd. v. Potentia Renewables Inc., 2017 ONCA 784

Libfeld v. Libfeld , 2023 ONCA 128

Keywords: Business Law, Partnerships, Fiduciary Duty, Oppression, Financing of Transactions, Vendor-Takeback Mortgages, Compliance with Orders, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Pro Swing Inc. v. ELTA Golf Inc., 2006 SCC 52

Burr v. Tecumseh Products of Canada Limited, 2023 ONCA 135

Keywords: Tort, Negligence, Duty to Warn, Duty of Care, Contract, Product Liability, Indemnification, Costs, Courts of Justice Act, R.S.O. 1990, c. C.43, Rules of Civil Procedure, R.R.O. 1990, Reg. 194, Rankin’s Garage & Sales v. J.J., 2018 SCC 19, [2018] 1 S.C.R. 587, Clements v. Clements, 2012 SCC 32, [2012] 2 S.C.R. 181, Housen v. Nikolaisen, 2002 SCC 33, [2022] 2 S.C.R. 235, Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, [2004] S.C.R. 303, Ford Motor Company of Canada, Ltd. v Ontario Municipal Employees, 2006 CanLII 7665 (Ont. C.A.), 1318847 Ontario Limited v. Laval Tool & Mould Ltd., 2017 ONCA 184, 134 O.R. (3d) 641, Mustapha v. Culligan of Canada Ltd., 2008 SCC 27, [2008] 2 S.C.R. 114, 1688782 Ontario Inc. v. Maple Leaf Foods Inc., 2020 SCC 35, 450 D.L.R. (4th) 181, Lambert v. Lastoplex Chemicals, [1972] S.C.R 569, Labrecque v. Saskatchewan Wheat Pool, (1977), 78 D.L.R. (3d) 289 (Sask. Q.B.), Ruegger v. Shell Oil Co. of Can. Ltd., [1964] 1 O.R. 88 (H.C.), Hollis v. Dow Corning Corp., [1995] 4 S.C.R. 634, Nicholson v John Deere Ltd. (1986), 58 O.R. (2d) 53 (S.C.), 1986 CarswellOnt 965, Price v. Smith & Wesson Corp., 2021 ONSC 8471, Kreutner v. Waterloo Oxford Co-operative Inc. (2000), 50 O.R. (3d) 140 (C.A.), St. Isidore Co-op Limited v. AG Growth International Inc., 2020 ABCA 447, Rentway Canada Ltd./Ltee v. Laidlaw Transport Ltd. (1989), 49 C.C.L.T. 150 (Ont. H.C.), Ragoonanan Estate v. Imperial Tobacco Canada Ltd., 51 O.R. (3d) 603 (S.C.), Voss v. Black & Decker Mfg. Co. (1983), 450 N.E. 2d 204, at p. 208 (N.Y.C.A.), Hacopian-Armen Estate v. Mahmoud, 2021 ONCA 545, Western Processing & Cold Storage Ltd. v. Hamilton Construction Company Ltd. (1965), 51 D.L.R. (2d) 245 (Man. C.A.), Hollis v. Down Corning Corp., [1995] 4 S.C.R. 634, Rivtow Marine Ltd. v. Washington Iron Works, [1974] S.C.R. 1189, Deloitte & Touche v. Livent Inc. (Receiver of), 2017 SCC 63, [2017] 2 S.C.R. 855, Bow Valley Husky (Bermuda) Ltd. v. Saint John Shipbuilding Ltd., 1997 CanLII 307 (SCC), [1997] 3 S.C.R. 1210, Club Resorts Ltd. v. Van Breda, 2012 SCC 17, [2012] 1 S.C.R. 572, Plas-Tex Canada Ltd. v. Dow Chemical of Canada Ltd., 2004 ABCA 309, 245 D.L.R. (4th) 650, Betker v. Williams, 86 D.L.R. (4th) 395, Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 291 (C.A.), Coventree Inc. v. Lloyds Syndicate 1221 (Millenium Syndicate), 2011 ONSC 6660, Zesta Engineering Ltd. v. David Cloutier, 2002 CanLII 25577 (Ont. C.A.), 21 C.C.E.L. (3d) 161, Coldmatic Refrigeration of Canada Ltd. v. Leveltek Processing LLC (2005), 75 O.R. (3d) 638 (C.A), McDowell v. Barker, 2012 ONCA 827, Alie v. Bertrand & Frere Construction Co. Ltd., 62 O.R. (3d) 345 (C.A.), Darling v. Kay (1993), 15 O.R. (3d) 299 (Gen. Div.), Xpert Credit Control Solutions Inc. v. Borges, 2015 ONSC 6505, United Soils Management Ltd. v. Mohammed, 2019 ONCA 128, Bossé v. Mastercraft Group Inc., 123 D.L.R. (4th) 161, 7550111 Canada Inc. v. Charles, 2020 ONCA 505, Heliotrope Investment Corporation v. 1324789 Ontario Inc., 2022 ONCA 411, West Van Holdings Ltd. v. Economical Mutual Insurance Company, 2019 BCCA 110

Urbancorp Inc. v. 994697 Ontario Inc., 2023 ONCA 126

Keywords: Bankruptcy and Insolvency, Corporate Restructuring, Creditor’s Rights, Chose in Actions, Assignment, Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-38, s. 13 and s. 45, Ontario Business Corporations Act, R.S.O. 1990, c. B.16, s. 248 and s. 255, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, s. 96, Fraudulent Conveyances Act, R.S.O. 1990, c. F.29, Assignments and Preferences Act, R.S.O. 1990, c. A. 33, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 6(1)(b) and s. 19(1)(b), Canada Business Corporations Act, R.S.C. 1985, c. C-44, Rules of Civil Procedure, R.R.O. 1990, Reg. 194, Essar Steel Algoma (Re), 2016 ONCA 138, Redfern Resources Ltd. (Re), 2011 BCCA 333, Monarch Land Limited v. CIBC Mortgages Inc., 2014 ABCA 143, Sandhu v. MEG Place LP Investment Corporation, 2012 ABCA 91, Hemosol Corp. Re, 2007 ONCA 124, Business Development Bank of Canada v. Astoria Organic Matters Ltd., 2019 ONCA 269, Dal Bianco v. Deem Management Services Ltd., 2020 ONCA 585, Ting (Re), 2021 ONCA 425, Rusinek & Associates Inc. v. Arachchilage, 2021 ONCA 112, Kelvin Energy Ltd. v. Lee, [1992] 3 S.C.R. 235, Ontario Securities Commission v. McLaughlin, 2009 ONCA 280, 1186708 Ontario Inc. v. Gerstein, 2016 ONCA 905, Shaw Estate v. Nichol Island DevelopmentIncorporated, 2009 ONCA 276, Toyota Canada Inc. v. Imperial Richmond Holdings Ltd. (1993), 140 A.R. 1 (K.B.), Nortel Networks Corporation (Re), 2016 ONCA 332, Urbancorp Toronto Management Inc. (Re), 2022 ONCA 181

Park Lawn Corporation v. Kahu Capital Partners Ltd., 2023 ONCA 129

Keywords: Defamation, Motions, Anti-SLAPP Motions, Harm, Damages, Protection of Public Participation Act, 2015, S.O. 2015, c. 23, s. 137.1, 137.2(2), Courts of Justice Act, R.S.O. 1990, c. C.43(“CJA”), 1704604 Ontario Ltd. v. Pointes Protection Association, 2020 SCC 22, Bent v. Platnick, 2020 SCC 23, Tamming v. Paterson, 2021 ONSC 8306, Canadian Thermo Windows Inc. v. Seangio, 2021 ONSC 6555, Canadian Union of Postal Workers v. B’nai Brith Canada, 2021 ONCA 529, Bangash v. Patel, 2022 ONCA 763, Levant v. De Melle, 2022 ONCA 79, Lascaris v. B’nai Brith Canada, 2019 ONCA 163, Barrick Gold Corp. v. Lopehandia (2004), 71 O.R. (3d) 416 (C.A.), “Canadian Anti-SLAPP Laws in Action” (2022) 100:2 Can. B. Rev. 186

Celestini v. Shoplogix Inc., 2023 ONCA 131

Keywords: Employment Law, Wrongful Dismissal, Notice Period, Reasonable Notice, Changed Substratum Doctrine, Damages Award, Bonus Payment, Employment Standards Act, 2000, S.O. 2000, c. 41, Machtinger v HOJ Industries Ltd., [1992] 1 S.C.R. 986, Wallace v. Toronto-Dominion Bank (1983), 41 O.R. (2d) 161 (C.A.), MacGregor v. National Home Services, 2012 ONSC 2042, Miller v. Convergys CMG Canada Limited Partnership, 2013 BCSC 1589, 10 C.C.E.L. (4th) 187, Schmidt v. AMEC Earth & Environment et al., 2004 BCSC 1012 , Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633, Rasanen v. Lisle-Metrix Ltd. (2002), 17 C.C.E.L. (3d) 134 (Ont. S.C.), Matthews v. Ocean Nutrition Canada Ltd., 2020 SCC 26, 449 D.L.R. (4th) 583, Paquette v. TeraGo Networks Inc., 2016 ONCA 618, 34 C.C.E.L. (4th) 26, Lin v. Ontario Teachers’ Pension Plan, 2016 ONCA 619, 402 D.L.R. (4th) 325, SFC Litigation Trust v. Chan, 2019 ONCA 525, 147 O.R. (3d) 145, Bernier v. Nygard International Partnership, 2013 ONCA 780

Maisonneuve v. Maisonneuve, 2023 ONCA 138

Keywords: Fiduciary Duty, Negligence, Breach of Contract, Misrepresentations, Conflict of Interest, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, s. 5(1)(a)(iv), Palmer v. The Queen, [1980] 1 S.C.R. 759

Sumner v. Ottawa (Police Services), 2023 ONCA 140

Keywords: Tort, Abuse of Process, Rules of Civil Procedure, R.R.O. 1990, Reg. 194, r. 2.1.01(1), r. 2.1.01(3), r. 2.1.01(6), Penner v. Niagara (Regional Police Services Board), 2013 SCC 19, Markowa v. Adamson Cosmetic Facial Surgery Inc., 2014 ONSC 6664, Scaduto v. The Law Society of Upper Canada, 2015 ONCA 733, Khan v. Krylov & Company LLP, 2017 ONCA 625, Gao v. Ontario WSIB, 2014 ONSC 6497

Ontario (Attorney General) v. Trinity Bible Chapel, 2023 ONCA 134

Keywords: Charter of Rights and Freedom, Ontario COIVD-19 Regulations, COVID-19 Restrictions, Religious Freedoms, Oakes Test, Infringement, Reasonable Limits, Canadian Charter of Rights and Freedoms, Reopening Ontario (A Flexible Response to COVID-19) Act, 2020, S.O. 2020, c. 17, Constitution Act, 1982, s. 52(1), Rules of Civil Procedure, R.R.O. 1990, Reg. 194, Criminal Code, R.S.C. 1985, c. C-46, Alberta v. Hutterian Brethren of Wilson Colony, 2009 SCC 37, [2009] 2 S.C.R. 567, Loyola High School v. Quebec (Attorney General), 2015 SCC 12, Law Society of British Columbia v. Trinity Western University, 2018 SCC 32, Doré v. Barreau du Québec, 2012 SCC 12, R. v. Oakes, [1986] 1 S.C.R. 103, (Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, Hoang (Litigation guardian of) v. Vicentini, 2016 ONCA 723, Parliament (Litigation guardian of) v. Conley, 2021 ONCA 261, Beaudoin v. British Columbia (Attorney General), 2022 BCCA 427, Ross v. New Brunswick School District No. 15, [1996] 1 S.C.R. 825, to Figueiras v. Toronto Police Services Board, 2015 ONCA 208, British Columbia Teachers’ Federation v. British Columbia Public School Employers’ Assn., 2009 BCCA 39, R. v. Khawaja, 2012 SCC 69, Saskatchewan v. Durocher, 2020 SKQB 224, Right to Life Association of Toronto v. Canada (Employment, Workforce and Labour), 2021 FC 1125, Canadian Union of Postal Workers v. Her Majesty in Right of Canada, 2016 ONSC 418, R. v. Big M Drug Mart Ltd., [1985] 1 S.C.R. 295, Carter v. Canada (Attorney General), 2015 SCC 5, Devine v. Quebec (Attorney General), [1988] 2 S.C.R. 790, R. v. Poirier, 2016 ONCA 582, R. v. Grant, 2009 SCC 32, Canada (Attorney General) v. Bedford, 2013 SCC 72, R. v. Collins, [1987] 1 S.C.R. 265, RJR-MacDonald Inc. v. Canada (Attorney General), [1995] 3 S.C.R. 199, Harper v. Canada (Attorney General), 2004 SCC 33, Thomson Newspapers Co. v. Canada (Attorney General), [1998] 1 S.C.R. 877, R. v. Sharpe, 2001 SCC 2, Saskatchewan (Human Rights Commission) v. Whatcott, 2013 SCC 11, R. v. Michaud, 2015 ONCA 585, Grandel v. Saskatchewan, 2022 SKKB 209, Gateway Bible Baptist Church et al. v. Manitoba et al., 2021 MBQB 219, “Interpreting Freedom of Thought in the Canadian Charter of Rights and Freedoms” (2019) 91 S.C.L.R. (2nd) 107, “Big M’s Forgotten Legacy of Freedom” (2020) 98 S.C.L.R. (2nd) 15; “Recovering Community: Addressing Judicial Blindspots on Freedom of Association” (2020) 98 S.C.L.R. (2nd) 399

Jovkovic v. DaSilva, 2023 ONCA 137

Keywords: Bankruptcy and Insolvency, Judgment Creditor, Property Transfer, Transfer for Undervalue, Assignment in Bankruptcy, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, s. 38, s. 96, s. 96(1)

Aslezova v. Khanine, 2023 ONCA 153

Keywords: Family Law, Financial Disclosure, Court Orders, Non-Compliance, Motion to Strike, Family Law Rules, O. Reg. 114/99, s. 1(8), Martin v. Watts, 2020 ONCA 406, Mullin v. Sherlock, 2018 ONCA 1063, Roberts v. Roberts, 2015 ONCA 450, Purcaru v. Purcaru, 2010 ONCA 92, Kovachis v. Kovachis, 2013 ONCA 663, Ferguson v. Ferguson, 2022 ONCA 543, Manchanda v. Thethi, 2016 ONCA 909, Lalande v. Lalande, 2023 ONCA 68, Peerenboom v. Peerenboom, 2020 ONCA 240

Short Civil Decisions

Sunlight General Capital LLC v. Effisolar Energy Corporation,2023 ONCA 133

Keywords: Foreign Judgment, Recognition and Enforcement, Suspension of Limitation Periods, Reopening Ontario (A Flexible Response to COVID-19) Act, 2020, O. Reg 73/20, Practice Direction Concerning Civil Appeals, s. 13, Beals v. Saldanha, 2003 SCC 72, Independence Plaza 1 Associates L.L.C. v. Figliolini, 2017 ONCA 44

Everest Finance Corporation v. Jonker, 2023 ONCA 146

Keywords: Costs, Full Indemnity, MCAP Financial Corp. v. George Fernicola in Trust and Carrington Homes Ltd., 2010 ONSC 148

Daly v. Ontario (Landlord and Tenant Board), 2023 ONCA 152

Keywords: Landlord and Tenant Board, Sexual Harassment, Substantial Interference, Bias, No Reasonable Cause of Action, Canadian Charter of Rights and Freedoms, s. 24(1), Rules of Civil Procedure, R.R.O. 1990, Reg. 194, r. 21.01, Residential Tenancies Act, 2006, S.O. 2006, c. 17, s. 232(1), Crown Liability and Proceedings Act, 2019, S.O. 2019, c. 7, Sch. 17, s. 9(2)(b), Raba v. Landlord and Tenant Board, 2014 ONSC 2599, Speckling v. Kearney, 2007 BCCA 145

Adejuyigbe v. Boynton,2023 ONCA 141

Keywords: Employment Law, Severance, Full and Final Release, Discrimination, No Reasonable Cause of Action, Settlement Privilege, Rules of Civil Procedure, R.R.O. 1990, Reg. 194, r. 21.01(1)(b), Atlantic Lottery Corp. Inc. v. Babstock, 2020 SCC 19

Rudin-Brown v. Brown, 2023 ONCA 151

Keywords: Wills and Estates, Loss of Capacity, Power of Attorney for Property and Personal Care, Meritless Appeal, Costs, Substantial Indemnity, Lewis v. Lewis, 2019 ONCA 690

2343680 Ontario Inc. v. Talpade, 2023 ONCA 154

Keywords: Mortgagee and Mortgagor, Default, Enforcement, Bias and Prejudice, Procedural Fairness, Palkowski v. Ivancic, 2009 ONCA 705, Housen v. Nikolaisen, 2002 SCC 33

CIVIL DECISIONS

Sinclair v. Amex Canada Inc., 2023 ONCA 142

[Tulloch, Nordheimer, and Harvison Young JJ.A.]

Counsel:

D. Zuber and P. Essig, for the appellants
N. Paris and Z. Parrott, for the respondents

facts:

On July 25, 2017, in Venice, Italy, the respondents, together with their son, were passengers on a water taxi that crashed into a wooden structure. The respondents were both injured, and the respondent Mr. S was seriously injured.

The respondents and their son travelled to Venice and were transported by van from the airport to the water taxi terminal where they boarded a water taxi owned by the appellant. The water taxi was operated by the defendant, CD. CD did not respond to these proceedings. The accident occurred during the trip to their hotel.

The respondents had arranged their travels through Amex Canada Inc. (“Amex Canada”) which operated under the name Centurion Travel Service. Amex Canada provides travel-related services to individuals in Canada. Mr. S used his Centurion Card membership to book the trip.

As pleaded by the defendant, Amex Canada, Centurion Card members enjoy benefits, including access to dedicated concierge and travel agent services for booking personalized travel services such as car services, flights, and hotel accommodations. All travel bookings are made through Centurion Travel Service. Centurion Travel Service routinely engages third-party travel suppliers, at the request and on behalf of Centurion Card members, for the provision of travel services to such Centurion Card members.

Centurion Travel Service contacted the defendant, Carey International, Inc., who in turn contacted the appellant, Venezia Turismo, which was a water taxi dispatching company. As pleaded, Venezia Turismo then contacted the appellant, Venice Limousine S.R.L., which was the owner of the water taxi involved in the accident. Venice Limousine S.R.L. also employed the driver of the water taxi. At the same time, the appellant Medov S.R.L. sent an e-mail to Venezia Turismo confirming the booking for the water taxi.

The three Italian companies now appeal the order of the motion judge who dismissed their motion for an order dismissing the action, or alternatively staying the action, on the basis that the Ontario Superior Court of Justice lacked jurisdiction. The action was grounded in the tort of negligence.

issues:

(1) Did the trial judge err in their application of the fourth factor from the Van Breda Test?

(2) Did the appellants rebut the establishment of a presumptive connecting factor?

holding:

Appeal allowed.

reasoning:

(1) Yes

The Court noted that the applicable standard of review is correctness as the appeal stems from allegations of a legal error in the application of the Van Breda test. The Court determined that the sole issue before the motion judge was whether the fourth presumptive connecting factor from Club Resorts Ltd. v. Van Breda, gave the Ontario Superior Court of Justice jurisdiction over the appellants with respect to the action started by the respondents. The motion judge concluded that it did. The Court disagreed and found that the motion judge erred in so concluding.

The Court listed the four presumptive connecting factors from Van Breda:

In a case concerning a tort, the following factors are presumptive connecting factors that, prima facie, entitle a court to assume jurisdiction over a dispute:

(a) the defendant is domiciled or resident in the province;

(b) the defendant carries on business in the province;

(d) a contract connected with the dispute was made in the province.

The Court found it pertinent to mention two salient facts from Van Breda, as well as its companion case, Charron, that distinguished them from the present action. First, the Court noted that, in both cases, the actions were based both in contract and in tort. The Court also noted that, in Van Breda, it appears that the defendants, other than the travel agency, were all companies related to Club Resorts.

The Court also found it important to note that the contract in Van Breda, and upon which jurisdiction was found, directly connected the plaintiffs and the objecting defendants.

The Court held that the Van Breda test was not properly applied by the motion judge. The Court stated that the application of the presumptive connecting factors is to be viewed from the perspective of the defendant who is disputing jurisdiction and while there may be a defendant who is not disputing jurisdiction, it does not mean that the court can avoid looking at the jurisdiction issue from the perspective of the defendant disputing jurisdiction. The Court found that it was the failure to examine the jurisdiction issue from the position of the appellants that constituted the error committed by the motion judge in her analysis. The fact that Amex Canada could not object to the Ontario Court’s jurisdiction did not meant that the other defendants, who had some connection with the subject matter of the claim, were then subject to the same jurisdiction.

The Court also held that there was nothing in the contractual relationship between the respondents and Amex Canada that required the appellants’ involvement. The Court noted that even if one could give the contractual arrangements the type of emphasis that the respondents attempted to do, it was hard to see how the conduct of any of the appellants could be said to be “within the scope of the contractual relationship” or that the “events that give rise to the claim flow from the relationship created by the contract”. Accordingly, the Court found that the contract between the respondents and Amex Canada did not create a contractual relationship between the respondents and the appellants.

(2) Yes.

The Court found that the appellants had rebutted the presumptive connecting factor. The Court held that it was still necessary, even with the presence of a presumptive connecting factor, to establish a “real and substantial” connection between the dispute and the court assuming jurisdiction.

The Court held that the motion judge had erred by failing to engage in this aspect of the inquiry. The Court found that the appellants had rebutted it by demonstrating that the contract between the respondents and Amex Canada, had little or nothing to do with the subject matter of the litigation. There was also nothing pleaded that would establish that the contract had any connection to the claim against the appellants. The Court noted that it was not alleged that there were any ongoing contractual relationships between these Italian companies and Amex Canada or Carey International, Inc. The Court also stated that there were no allegations that there was anything in the contractual relationship between Amex Canada and/or Carey International, Inc. and the respondents, that contemplated that the appellants would be engaged in the carrying out of that contractual relationship.

Accordingly, in the Court’s view, the contract that was made in Ontario between the respondents and Amex Canada had little relevance to the subject matter of the litigation. The Court also found that none of the appellants would reasonably be expected to be called to answer legal proceedings in Ontario, as there was simply nothing that connects the events and the appellants to Ontario.

Concurring Decision of Harvison Young J.A.

(1) No.

Young J.A. found that the issue was whether the motion judge erred by failing to look at each defendant individually is “rooted in” and a “component of” the larger issues as framed by the parties of whether the motion judge erred in her analysis that there was an Ontario contract connected to the dispute. Young J.A rejected the argument that a motion judge must “expressly and mechanically run through the Van Breda factors with respect to each defendant where the defendants are alleged to have acted in an interconnected way”.

Young J.A. found that the motion judge correctly outlined the current state of the law on jurisdiction simpliciter as she had identified that the only presumptive connecting factor relevant to this dispute was whether there was an Ontario contract connected to the dispute.

Young J.A. noted that the underlying rationale of the fourth presumptive connecting factor—a contract connected with the dispute was made in the province—is that “‘but for’ the contract made in the province the plaintiff would not have suffered the harm”

Young J.A. found that the motion judge did not err in her application of the first Van Breda step and noted that identity of the parties is fundamental to contract formation. The identity of the party with whom the respondents were dealing with was AMEX Canada for the Centurion card and for the booking of the water taxi in Venice Italy, and those contracts were formed in Ontario. Accordingly, Young J.A. agreed with the motion judge’s findings that a presumptive connecting factor between the subject of the litigation and the court’s jurisdiction had been established.

Young J.A. stated that the motion judge had correctly concluded that the appellants’ allegedly tortious conduct in their discharging of the water taxi services flowed from the Centurion Cardholder Agreement, a contract undoubtedly formed in Ontario, and which provided for the booking of services, such as the water taxi. Accordingly, Young J.A. found that the requisite threshold to establish the fourth presumptive connecting factor had been met.

Accordingly, Young J.A. found no error in the motion judge’s analysis.

(2) Yes.

Young J.A. agreed with the majority of the Court that in the event there is a presumptive connecting factor, the motion judge erred in failing to consider whether it was rebutted, and agreed that, in the circumstances, the presumption has been successfully rebutted.

Johwel Investments Inc. v. Welton, 2023 ONCA 132

[Brown, Sossin and Copeland JJ.A.]

Counsel:

S.J. Erskine and P. Healy, for the appellant

T. Pinos and M. Rourke, for the respondents Stonebrook II Limited Partnership and Johwel Investments Inc.

D.M. Golden, for Davwel Investments Inc.

facts:

Over a decade ago, the appellant, DW1, was employed by Stonebrook Properties Inc. (“Stonebrook”) to manage the sale of condominium units at a Mississauga condominium development known as the Stonebrook Development (the “Development”). Stonebrook was owned equally by two brothers, JW and DW2, through their holding companies, Johwel Investments Inc. and Davwel Investments Inc. DW2 was DW1’s husband until his death in 2013.

Title to the real property on which the two-tower condo Development was to be constructed was registered in the name of Stonebrook. One tower of the Development was built, and title to that portion of the property was transferred to a condominium corporation. The remaining portion of the property remained registered in the name of Stonebrook (the “Property”).

When Stonebrook did not pay DW1 the commissions she thought due to her, she started an action for damages against it in 2012. She initiated a second action against Stonebrook in 2015 seeking similar relief. In neither action did DW1 join the co-tenants, JW and DW2, as defendants. The actions were tried together in 2019, resulting in a judgment in favour of DW1 against Stonebrook (the “Judgment”). DW1 sought to execute her judgment. She obtained a writ of seizure and sale that she registered against title to the Property (the “Writ”).

Since 2013, JW and DW2 had been locked in litigation over several matters, including their interests in the Development. They reached a settlement in 2019. Under the settlement, JW planned to transfer all of DW2’s interests in the Development to the respondent, Stonebrook II Limited Partnership. However, JW and DW2 were unable to close a financing of the settlement due to the Writ registered against title to the Property.

The respondents, JW and Stonebrook II, thereupon commenced an application seeking an order lifting the Writ from title and, if necessary, the ability to pay into court the amount of DW1’s Judgment. Hainey J. granted the order sought, allowing title to the Property to be conveyed, but he ordered counsel for the respondent JW to hold in trust the amount of $235,750 to the credit of the application.

The issue of whether the Writ attached to the Property was then considered by the application judge. She concluded that the Writ did not attach to the Property held by Stonebrook and ordered the funds held in trust be released to the respondents (the “Order”). The basis of her decision was that Stonebrook held title to the Property as bare trustee for the two co-tenants, JW and DW2. As a result, Stonebrook, as bare trustee, had no interest in the property available for seizure by one of its execution creditors, such as DW1.

issues:

Did the application judge commit a palpable and overriding error in finding that because Stonebrook was a bare trustee, it was not obligated to pay DW?

holding:

Appeal dismissed.

reasoning:

No.

The Court was not persuaded by DW1’s argument that Stonebrook had various obligations as a bare trustee. The Court found the application’s reasons disclosed that she did not ignore evidence about how Stonebrook carried on its business, as contended by DW1. The Court explained that the application judge’s key factual findings were ample to support that Stonebrook was a bare trustee of the Property, as Stonebrook had no independent powers, discretions or responsibilities. Such findings were supported by the evidence reviewed by the application judge. As such, the Court held that since DW1 did not argue that the application judge applied incorrect legal principle to the facts, the Court had no basis to interfere.

Haudenosaunee Development Institute v. Metrolinx, 2023 ONCA 144

[MacPherson, van Rensburg and Benotto JJ.A.]

Counsel:

T. Gilbert, C. Carruthers, T. Dumigan, J. MacDonald, J. Martin, and Z. Cynader, for the appellant/moving party (M54052) and the appellant/responding party (M54053/M54054)

S. Batner, B. Gray, S. Rogers, B. Greenaway, and C. Puskas, for the respondent/responding party (M54052) and the respondent/moving party (M54053/M54054)

facts:

The respondent, Metrolinx, brought a motion to quash the appeal of the appellant Haudenosaunee Development Institute (“HDI”) from an order of a judge of the Superior Court of Justice dated February 10, 2023, dismissing its motion for an interlocutory injunction. Metrolinx also brought a motion seeking an order pursuant to s. 7(5) of the Courts of Justice Act, (“CJA”), setting aside the order of Gillese J.A. of this court dated February 11, 2023. In that order, on a motion brought by HDI, Gillese J.A. granted an interim injunction that, inter alia, enjoined Metrolinx from cutting down any trees on the Osgoode Hall property pending the disposition of HDI’s motion.

Gillese J.A. then adjourned the motion to February 14. On February 14, Metrolinx also raised as a preliminary matter an allegation of reasonable apprehension of institutional bias, seeking to disqualify the panel or any judge of this court from hearing any matter related to HDI’s appeal, including the pending motions. HDI, in turn, brought a motion for an extension of the Gillese J.A. interim injunction pending its appeal, or, in the event that jurisdiction lay with the Divisional Court, pending a motion for leave to appeal to that court.

issues:

(1) Is the Court of Appeal for Ontario, and are all the judges on that court, precluded from hearing the motions and the underlying appeal because of a reasonable apprehension of ‘institutional bias’?
(2) Does this court lack jurisdiction to hear this appeal because Hackland J.’s order is an interlocutory, not a final order and, therefore, any appeal must be heard and determined by the Divisional Court with leave?

holding:

Appeal dismissed.

reasoning:

(1) No.

The Court, relying on the test for reasonable apprehension of bias from Committee for Justice and Liberty v. National Energy Board, found Metrolinx’s position far removed for the stringent standard. The Court explained that most judges, particularly chief justices and associate chief justices, hold two roles: (1) an adjudicative role, and (2) administering the court role. For the latter, these judges must communicate and interact with many external constituencies such as governments (attorney generals), the Canadian Bar Association and the Law Society of Ontario, and others. As such, the Court clarified that these relationships are administrative and not adjudicative.

The Court concluded that the concerns about the practicalities of administering court hearings amidst an ongoing construction project does not cast any aspersions on the court’s ability to perform its adjudicative role.

(2) Yes.

The Court held that the order dismissing HDI’s motion was interlocutory in nature and therefore, the appeal was not within the jurisdiction of the Court. The Court relied on Paulpillai Estate v. Yusuf (“Paulpillali Estate”), which held that in order to determine whether an order under appeal is final or interlocutory, the Court must examine the terms of the order, the motion judge’s reasons for the order, the nature of the proceedings giving rise to the order, and other contextual factors that may inform the nature of the order.

The Court first considered HDI’s Notice of Application (the “NOA”, which provided the framework of the litigation it commenced. The NOA claimed a number of declarations, including that the Haudenosaunee have treaty rights over the Osgoode Hall site, that the Ontario Line Project will infringe those rights, that Metrolinx owes a duty to engage with the Haudenosaunee and the HCCC in respect of the Project, and that Metrolinx has not adequately engaged. As such, the Court found that the, the NOA revealed that the issues in the Application concerned more than the requested injunction and that nothing in the NOA suggested that the subject matter of the application was limited to the trees at Osgoode Hall.

The Court found that the order under appeal was made in the context of the motion and nothing in the Amended Notice of Motion suggested HDI sought a final determination of any issue when it brought its motion.

Secondly, the Court found that there was nothing in the order itself suggesting that any issue in the application proceeding was determined on a final basis. The Court clarified that the order simply dismissed the motion for an interlocutory injunction. The Court also found that the reasons of Hackland J. did not indicate that he determined any issue in the NOA on a final basis.

Finally, the Court did not accept HDI’s argument that the practical effect of the order refusing an injunction to prevent the trees from being cut down was to bring an end to the litigation. The Court relied on the affidavits, which refer to a history of communications between the parties with respect to the Ontario Line Project and the Osgoode Hall site and unresolved issues that extend beyond the immediate concern respecting the trees at the Osgoode Hall site. The Court therefore held that the order was made in the context of HDI’s motion for interlocutory injunctive relief and it did not determine the real matter in dispute between the parties.

Libfeld v. Libfeld, 2023 ONCA 128

[Roberts, Miller and Nordheimer JJ.A.]

Counsel:

P. Steep, H. Kallmeyer and I. Hull, for the appellants (C69714) and respondents (C69751, C70031 and C70032), CL and 1331078 Ontario Inc.

P.H. Griffin, K. Glowach and S. Bittman, for the appellants (C69751) and respondents (C69714, C70031 and C70032), ML, 1331081 Ontario Inc., 2091170 Ontario Inc., and Vitanna Construction Ltd.

D. Chernos, P. Flaherty and B. MacLeese, for the appellants (C70031 and C70032) and respondents (C69714 and C69751), SL and 1331088 Ontario Inc.

G. Luftspring and A. Sanche, for the appellants (C70031 and C70032) and respondents (C69714 and C69751), JL and 1331091 Ontario Inc.

H. Chaiton, for the Court-Appointed Sales Officer

facts:

The dispute arose from the breakdown of a business relationship of four brothers – SL, ML, JL, and CL – who were equal owners of The Conservatory Group (the “Group”), a Toronto-based real estate development partnership. There was no written partnership agreement. SL was generally responsible for the Group’s finances and was the most involved with the overall management.

Conflicts among the brothers began to surface in 2005, relating to the Group’s practice of cash distribution. The longstanding practice of the Group was to retain profits within the Group, minimizing cash distributions to each brother, and deferring income tax liability. However, ML became aware of the tax liability that his estate would face on his death. He proposed that the Group significantly increase the life insurance it provided for each of the partners. The other brothers were unwilling. Furthermore, CL wished to increase the monthly cash distributions. These proposals, among other things, resulted in ongoing conflict.

ML brought an application in 2017 seeking a declaration winding up the Group. At trial, CL backed ML’s position. JL and SL, on the other hand, sought to remain partners of the Group and proposed a buy-sell transaction. Alternatively, they sought to buy out ML and CL’s interest in the Group.

Additionally, ML sought a declaration that lands in Caledon, Ontario owned by Shanontown Developments Inc. (“Shanontown”) – itself owned by SL, JL, and CL – are assets of the Group, such that ML would be entitled to a 25% partnership interest in the Shanontown lands. At trial, the two sides also made claims of oppression and breach of fiduciary duty against each other.

The trial judge made no findings of oppression or breach of fiduciary duty against any party, and dismissed ML’s application for the declaration that Shanontown be included as an asset of the Group. Most significantly, the trial judge ordered that the Group be wound up and sold under the supervision of a court-appointed Sales Officer, with all of the brothers being permitted to participate in the sales process as potential purchasers. Lastly, the trial judge later required each brother to certify compliance with the terms of the original judgment and the Data Room Order that created an electronic repository of Group documents. The purpose of the Data Room Order was to remedy the informational asymmetry among the brothers resulting from SL’s role in the financial management of the Group.

issues:

(1) Did the trial judge err in determining that ML was not a partner in the Shanontown transaction?

(2) Did the trial judge err in not including Shanontown in the wind-up order?

(3) Did the trial judge err in requiring the brothers to certify compliance with the Data Room Order?

holding:

Appeals C69751 and C69714 are dismissed. Appeals C70031 and C70032 are allowed in part.

reasoning:

(1) No.

Due to the fact that ML refused to enter into new transaction until the cash distribution practices changed, SL proposed an “Interim Arrangement.” Per the Interim Arrangement, where an opportunity came to the Group, any brother would have the option of not participating in that transaction in exchange for a cash distribution equal to the money that each of the other brothers required from the Group to invest in the project. Shanontown was the only transaction carried out under the Interim Arrangement. SL proposed the acquisition of land in Caledon for low-rise development. Shanontown was to be financed half through cash distribution and half through a vendor-takeback (“VTB”) mortgage. ML chose not to participate. Therefore, he received a cash distribution of $15 million, and each other brother contributed $15 million each to the Shanontown transaction.

Two changes were made to the Shanontown transaction: (1) it was financed by cash contributions, bank financing, and the VTB mortgage; and (2) the cash contribution was reduced from $45 million to $17 million, meaning that each participating brother was only required to put in $5.7 million. ML opted not to participate. In 2020, SL and JL offered to let ML join the Shanontown investment as a silent partner for $5.7 million, which ML declined. However, ML was not told that the partners’ equity in Shanontown had already been written down to negative $15.4 million. Neither was ML informed – nor was his consent sought – when the other brothers transferred $64 million from Group proceeds to pay off the VTB mortgage (ML was given a distribution of $21.7 million as compensation, which he received under protest).

ML argued that the brothers owed him a fiduciary duty and breached that duty when they made the changes to the Shanontown transaction, failed to disclose the negative equity position, and when they unilaterally reached into the assets of the Group to pay down the VTB mortgage in a manner not contemplated by the Interim Arrangement. The trial judge held that no such fiduciary duty existed because the Shanontown transaction was undertaken outside of the Group and without the participation of ML, in accordance with the Interim Arrangement. The Court noted that these findings were entitled to deference. The Court further stated that it was not relevant that the financing of Shanontown changed multiple times because he opted not to participate from the outset. Therefore, ML’s ground of appeal was dismissed.

(2) No.

CL argued that Shanontown ought to have been included in the wind-up order due to the dysfunctional relationship of the brothers. He submitted that the trial judge simply overlooked Shanontown in making the wind-up order. The Court disagreed. This was a heavily case managed proceeding with sophisticated parties, each with counsel. It was not apparent from the record that Shanontown was simply overlooked. The Court noted that, even if Shanontown were overlooked, the correct procedure would have been to return to the trial judge to seek clarification of the order.

(3) Yes.

None of the brothers argued for the inclusion of the Data Room Order. It was requested by the court appointed Sales Officer. SL and JL argued on appeal that the provision requiring the brothers to certify that they had complied with the original judgment, as well as the Data Room Order (the “Certification Provision”), ought to be struck on the basis that: (1) it is insufficiently clear, legally unnecessary, and impermissibly broad; and (2) it was not relief sought by any party and there is not a sufficient basis in the reasons to justify it.

The Sales Officer proposed the Certification Provision because they relied on disclosure of the brothers and there was a serious lack of trust and respect amongst them and based on the fact that SL held an informational advantage. ML and CL agreed with the Sales Officer’s submissions on this point.

SL and JL argued that the vagueness of the provision, threatens to leave all parties vulnerable to revolving contempt proceedings at the hands of each other. The Court agreed and struck the Certification Provision. The Court noted that a provision of this nature is not inherently problematic, but can be unwise in certain circumstances. None of the brothers have any objection to being bound by any of the terms of the judgment, however, certifying compliance is a different legal obligation. Carrying out obligations that are expressed using vague standards of performance can be carried out in good conscious and still be contested.

Certification stands on a different footing. It is akin to providing a warranty. Where an obligation to certify compliance is made part of a court order, it hazards the extension of the obligation to a matter of warranting that one has satisfied every conceivable interpretation of what the vague criteria used could require. In the context of this litigation, it does not appear that the Certification Provision provides any further benefit beyond what is included in the original judgement or the Data Room Order. Furthermore, due to the hostility of the litigation, there is a prospect and indeed likelihood that certifications will be met with allegations of non-compliance and even contempt.

Burr v. Tecumseh Products of Canada Limited, 2023 ONCA 135

[Tulloch, Thorburn and George JJ.A.]

Counsel:

H. Borlack and G. Bawolska, for the appellant Venmar Ventilation Inc.
J. T. Curry, D. N. Varah and S. Bittman, for the respondents Tecumseh Products of Canada Limited and Tecumseh Products Company
R. Dowhan and M. McMahon, for the respondents L.B. and J.C.

facts:

In 1994, the respondents installed a heat recovery ventilator (the “ventilator”) in their home. On November 5, 2012, the motor in the ventilator overheated, exploded and caught fire resulting in serious damage to their home. The unit, the motor and the cycling thermal protector had all outlived their life expectancy. The ventilator life expectancy was 15 years, and the motor life expectancy was 7 years. Because the ventilator was an unattended appliance, the respondents did not notice the malfunction for “weeks or months”. At the time of trial, there had been approximately 112 similar house fires.

The respondents’ ventilator was designed and manufactured by Venmar Ventilation Inc. (“Venmar”). The motor in the ventilator was designed and manufactured by Tecumseh Products Company (otherwise known as “Fasco”). Venmar and Fasco had a customer-supplier relationship in which Fasco built and delivered off-the-shelf motors with custom specifications requested by Venmar.

Fasco knew as early as the 1950s or 1960s the problem of overheating if the thermal protector in its motor failed. It did not relay that information to its manufacturer-customers, including Venmar. Venmar also knew there were overheating problems in 1994 but did not know they could lead to fire. Neither Fasco nor Venmar knew the root cause of the overheating problem. Venmar took many corrective steps and the relevant safety organizations approved Venmar’s corrective steps and largely left Venmar to its own devices. By the time of trial in 2021, the motors used in Venmar ventilator units had caused fires in slightly over 100 out of the 300,000 units manufactured, resulting in an effective malfunction rate of .038 percent.

The respondents brought an action against Venmar as manufacturer of the ventilator, and against Fasco as manufacturer of the motor in the ventilator. The parties agreed that the fire was caused by the end-of-life failure of the motor in the respondents’ ventilator. The cycling thermal protector used in the motor to prevent an overheating event failed in a closed position causing the motor to cycle repeatedly, overheat, and eventually ignite.

issues:

(1) Did the trial judge err in finding that Venmar was liable for the negligent design of the ventilator but not the duty to warn the respondents?

(2) Did the trial judge err in finding that Fasco was not liable for either the negligent design of the ventilator motor or the failure to warn Venmar or the respondents of the risk of its motors catching fire?

(3) Did the trial judge err in finding that even if Fasco had been found liable in negligence, Venmar was obliged to indemnify Fasco for any liability arising from Fasco motors used in Venmar ventilators?

(4) Did the trial judge err in finding that Fasco was only entitled to reduced partial indemnity costs rather than the full indemnity costs it sought?

holding:

Leave to appeal the costs order granted. Venmar’s appeal and the respondents’ cross-appeal dismissed. Fasco’s costs cross-appeal was remanded for re-determination.

reasoning:

(1) No.

First, the Court held that there was no dispute that Venmar owed a duty of care to the respondents. As such, the trial judge committed no legal error. The Court saw no palpable or overriding error in the trial judge’s determination that Venmar failed to design a ventilator that was reasonably free from fire hazard, or test its overall ventilator design and the component parts to ensure they were reasonably fit for the purpose. As such, there was no basis to interfere with the trial judge’s conclusion that Venmar was responsible for its “choice of an inappropriate component” for the ventilator which, in turn, created a substantial likelihood of harm to the respondents for which Venmar was responsible at law. Thus, the Court agreed with the trial judge’s conclusion that Venmar was liable for negligent design of the ventilator.

Second, as noted in Hollis v. Down Corning Corp., the Court reiterated the principles governing the duty to warn include the following: i) There is a duty to warn of dangers inherent in the use of a product; ii) The duty is ongoing and continues after the product is delivered; iii) Warnings must be clear and specific to the dangers that arise from ordinary use; and iv) The duty varies with the level of danger associated with ordinary use of the product.

In this case, the trial judge held that Venmar did not breach its duty to warn the respondents as, “until 2006, it was not aware of the failing that caused the fire”. Once approved and underway, the regulatory authorities in Canada and the U.S. had no complaints about the corrective steps taken by Venmar, other than some initial concerns in the early stages. The Court held that whether Venmar breached its duty to warn was a question of mixed fact and law to which deference is owed. There was evidence from Venmar representatives that Venmar did not discover that the fire was caused by the thermal protector failing in a locked rotor position until Venmar was able to make a unit catch fire in its laboratory. There was also evidence from Venmar’s representatives to confirm that the efforts taken by Venmar in 2006 were consistent with industry practice to warn consumers who had purchased its ventilators of the risk of fire.

(2) No.

The Court held that the issue of whether Fasco had a duty of care to the respondents is a question of law subject to correctness review. In determining whether “Fasco [was] liable to the [respondents] for failure to advise Venmar that the motor could catch fire”, the trial judge invoked the two-part Anns/Cooper duty of care test, that is: (i) whether a prima facie duty of care exists between the parties; and (ii) if so, whether there are any residual policy considerations which should negate or limit the scope of the duty, the class of persons to whom it is owed or the damages to which a breach of it may give rise: Deloitte & Touche v. Livent Inc. (Receiver of).

The trial judge held that Fasco did not cause or contribute to the damage as Venmar was aware, or should have been aware, of the need for one-shot thermal protectors in other Venmar products but decided not to include one with this ventilator, and Venmar rejected Fasco’s advice regarding the overheating issues, and only applied the fuse Fasco recommended after doing and relying on its own investigations.

The Court noted that manufacturers owe a duty to warn, which requires them to warn of the risks associated with the reasonably foreseeable use of their products and the Court did not see any principled reason why Fasco should be exempted from these duties.

The Court commented that it was also not clear that, as the trial judge determined, “it would not have mattered what Fasco told Venmar” as, had Venmar been alerted earlier, it could have investigated and discovered the foreseeable fire risk earlier. Nor was it clear that it would have been “commercially impractical” for Fasco to warn its manufacturer-customers of the known end-of-life risks as Fasco’s omission to inform Venmar of the risk of its motor catching fire was done in violation of its own corporate policy.

Furthermore, it was not clear whether the “learned intermediary” rule, which is an exception to the manufacturer’s duty to warn consumers about risks of a product, extended beyond cases involving a product that is “highly technical in nature and is intended to be used only under the supervision of experts, or where the nature of the product is such that the consumer will not realistically receive a direct warning from the manufacturer before using the product”, such as prescription drugs and medical devices. Cladding used to prevent oil pipes from freezing, for example, has been found not to be “a highly technical product” requiring expert supervision. The Court stated that ventilators are ordinary consumer products.

However, the Court held that it was unnecessary to conclusively address these issues in view of its determination that the trial judge was correct in concluding that Venmar was contractually obliged to indemnify Fasco for all claims, liabilities, losses and costs resulting from a finding that Fasco was negligent.

(3) No.

Fasco and Venmar’s relationship was governed by the Terms and Conditions of their two-page contract (“the Contract”). The Contract contained the purchase acknowledgment and invoice from Fasco to Venmar. The Contract was included with each delivery order. The indemnity clause provided that it was to be interpreted and construed according to the laws of the State of Missouri. However, no evidence was adduced at trial or on appeal to suggest that this choice of law would result in a change in the right to indemnification. The trial judge therefore reasonably concluded that the indemnity provision in the Contract was operative such that, if Fasco had been liable to the respondents, Venmar was contractually bound to indemnify Fasco for any damages payable to the respondents.

Moreover, the trial judge noted that the parties were sophisticated commercial entities, the Terms and Conditions of the Contract had remained the same for many years, they were conspicuous, bolded, reproduced and sent with every order, and therefore, “a reasonable person in Venmar’s position would have noticed them”. Venmar never objected to the indemnification provision although Venmar sought to modify another provision in the Contract relating to the terms of payment in 1997 or early 1998.

The Court found these factors constituted sufficient evidence to enable the trial judge to conclude that Venmar was aware of the agreement and consented to its terms, including Venmar’s obligation to indemnify Fasco.

(4) Yes.

The Court first reasoned that Ontario courts have consistently held that contractual terms that touch on the issue of costs do not bind the court in the exercise of judicial discretion to determine a costs award. Where the court has “good reason”, it may refuse to enforce a contractual term.

It was evident that the trial judge was clearly aware of the existence of the indemnity provision in the Contract and the position taken by Fasco that this should entitle Fasco to full indemnity costs. He therefore made a Sanderson order that Venmar pay both the respondents and Fasco costs rather than have the respondents pay Fasco’s costs of its successful defence. While the trial judge rejected Fasco’s claim for full indemnity costs, he held that Fasco “is free to make those [further costs] claims elsewhere”.

The Court held that the trial judge mistakenly believed that in determining the scale and quantum of costs, his task did not require him to consider the terms of the Contract and how, if at all, those terms affect the exercise of his discretion. Rather, he was of the view that Fasco would be “free to make those [further costs] claims elsewhere”. The Court determined that this was a legal error and remitted the issue of costs payable to Fasco only, to the trial judge.

Urbancorp Inc. v. 994697 Ontario Inc., 2023 ONCA 126

[Benotto, Roberts and Harvison Young JJ.A.]

Counsel:

C.E. Reed, for the appellants
J. Sacks, for the respondents

Keywords: Bankruptcy and Insolvency, Corporate Restructuring, Creditor’s Rights, Chose in Actions, Assignment, Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-38, s. 13 and s. 45, Ontario Business Corporations Act, R.S.O. 1990, c. B.16, s. 248 and s. 255, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, s. 96, Fraudulent Conveyances Act, R.S.O. 1990, c. F.29, Assignments and Preferences Act, R.S.O. 1990, c. A. 33, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 6(1)(b) and s. 19(1)(b), Canada Business Corporations Act, R.S.C. 1985, c. C-44, Rules of Civil Procedure, R.R.O. 1990, Reg. 194, Essar Steel Algoma (Re), 2016 ONCA 138, Redfern Resources Ltd. (Re), 2011 BCCA 333, Monarch Land Limited v. CIBC Mortgages Inc., 2014 ABCA 143, Sandhu v. MEG Place LP Investment Corporation, 2012 ABCA 91, Hemosol Corp. Re, 2007 ONCA 124, Business Development Bank of Canada v. Astoria Organic Matters Ltd., 2019 ONCA 269, Dal Bianco v. Deem Management Services Ltd., 2020 ONCA 585, Ting (Re), 2021 ONCA 425, Rusinek & Associates Inc. v. Arachchilage, 2021 ONCA 112, Kelvin Energy Ltd. v. Lee, [1992] 3 S.C.R. 235, Ontario Securities Commission v. McLaughlin, 2009 ONCA 280, 1186708 Ontario Inc. v. Gerstein, 2016 ONCA 905, Shaw Estate v. Nichol Island Development Incorporated, 2009 ONCA 276, Toyota Canada Inc. v. Imperial Richmond Holdings Ltd. (1993), 140 A.R. 1 (K.B.), Nortel Networks Corporation (Re), 2016 ONCA 332, Urbancorp Toronto Management Inc. (Re), 2022 ONCA 181

facts:

On October 6, 2016, Urbancorp Cumberland 2 GP Inc., Urbancorp Cumberland 2 L.P., Bosvest Inc., Edge on Triangle Park Inc., and Edge Residential Inc. (the “Urbancorp Companies”) were placed under the protection of the Companies’ Creditors Arrangement Act (“CCAA”) and The Fuller Landau Group Inc. was appointed their Monitor. The appeal concerns an order which arose in an action (“the claim”) that was originally commenced by the Monitor in April 2018. On May 9, 2018, Myers J. authorized the assignment of the Monitor’s claim to the CCAA creditors. The Monitor assigned the claim to G.G. in his capacity as the Foreign Representative of the CCAA creditors of the Urbancorp Companies (“the respondents”).

In their statement of claim, the respondents sought to set aside or invalidate transfers of condominium units to the appellants on various bases, including oppression under s. 248 of the Ontario Business Corporations Act (“OBCA”), transfers at undervalue under s. 96 of the Bankruptcy and Insolvency Act (“BIA”), fraudulent conveyances under the Fraudulent Conveyances Act, and/or fraudulent preferences under the Assignments and Preferences Act.

The respondents brought a pleadings motion to strike allegations in certain paragraphs of the appellants’ amended statement of defence on the basis that they were irrelevant in that they related to the events connected with the appointment and knowledge of the Foreign Representative. The motion judge agreed and struck certain sections of the amended statement of defence that contained the irrelevant allegations.

issues:

(1) Is leave to appeal required?

(2) Should leave to appeal be granted?

holding:

Appeal dismissed.

reasoning:

(1) Yes.

The Court concluded that the motion judge’s order was “made under” the CCAA such that leave to appeal was required pursuant to s. 13 of the CCAA. The Court clarified that the correct analytical framework, in determining whether an order requires leave to appeal under s. 13 of the CCAA, was set out in Essar Steel Algoma (Re) (“Essar”). In Essar, Brown J.A. advanced a purpose-focused inquiry informed by the legislative purpose underling the s. 13 leave requirement. As Essar concluded, the words, “made under this Act” in s. 13 must be given a broad interpretation to achieve the Act’s legislative purpose.

The Court explained that the motion judge’s order striking out the paragraphs of the amended statement of defence was bound up with and incidental to the CCAA proceedings out of which this proceeding arose. The foundation of the motion judge’s decision was that the struck paragraphs were irrelevant to the assigned claim of the Monitor that was brought for the benefit of all creditors in the CCAA proceedings.

The Court rejected the appellants’ submissions that the order in issue relates to the oppression remedy pleaded by the respondents. The Court found that such a narrow approach ignored the entirety of the respondents’ claims. Moreover, it risked devolving the requisite analysis into a parsing exercise and undermine the broad functional inquiry that the Court must apply in determining whether the order in issue was “made under” the CCAA.

The Court stated that where the jurisdiction of a court emanates from both the CCAA and another statute, it would be unhelpful to deconstruct the proceedings to determine which elements of the case fell under the CCAA and therefore require leave. Rather, the Court agreed with Sandhu v. MEG Place LP Investment Corporation, which held that “if a claim is being prosecuted by virtue of or as a result of the CCAA, section 13 applies.”

(2) No.

The Court held that the appellants met none of the criteria for leave. The Court explained that it is well-established that leave to appeal under s. 13 of the CCAA is granted sparingly. The following factors to consider in determining whether leave should be granted was recently reiterated in Urbancorp Toronto Management Inc. (Re): (a) the proposed appeal is prima facie meritorious or frivolous; (b) the points on the proposed appeal are of significance to the practice; (c) the points on the proposed appeal are of significance to the action; and (d) the proposed appeal will unduly hinder the progress of the action. The Court found no error in the motion judge’s analysis or conclusions. In addition, the Court found that the proposed appeal equally hindered the progress of the CCAA proceeding and the distribution of assets to the creditors.

Park Lawn Corporation v. Kahu Capital Partners Ltd., 2023 ONCA 129

[Pepall, Trotter and Thorburn JJ.A.]

Counsel:

R.W. Staley, N.J. Shaheen and A.N. Sahai, for the appellants
J. Groia and B. Pascutto, for the respondent

Keywords: Defamation, Motions, Anti-SLAPP Motions, Harm, Damages, Protection of Public Participation Act, 2015, S.O. 2015, c. 23, s. 137.1, 137.2(2), Courts of Justice Act, R.S.O. 1990, c. C.43 (“CJA”), 1704604 Ontario Ltd. v. Pointes Protection Association, 2020 SCC 22, Bent v. Platnick, 2020 SCC 23, Tamming v. Paterson, 2021 ONSC 8306, Canadian Thermo Windows Inc. v. Seangio, 2021 ONSC 6555, Canadian Union of Postal Workers v. B’nai Brith Canada, 2021 ONCA 529, Bangash v. Patel, 2022 ONCA 763, Levant v. De Melle, 2022 ONCA 79, Lascaris v. B’nai Brith Canada, 2019 ONCA 163, Barrick Gold Corp. v. Lopehandia (2004), 71 O.R. (3d) 416 (C.A.), “Canadian Anti-SLAPP Laws in Action” (2022) 100:2 Can. B. Rev. 186

facts:

The appellant, Park Lawn Corporation (“Park Lawn”), is Canada’s largest funeral home and deathcare enterprise. It maintains trust funds for, among other things, future care and maintenance of cemeteries, and pre-need funds deposited by consumers. These funds are held by third party trustees and managed by third party managers. The respondent, Kahu Capital Partners Ltd., an investment management company established under the laws of the Commonwealth of the Bahamas in 2017, managed certain of appellant’s trust funds.

In October 2019, the Board of Directors of the appellant appointed a Special Committee of independent directors to investigate allegations of misconduct against officers of the appellant. A third party would, in 2020, raise concerns with the appellant regarding the appellant’s relationship with the respondent.

The Special Committee and the appellant’s Investment Committee commenced an investigation into the respondent and its relationship with the appellant. As a result, Mr. CK, the appellant’s former CEO, resigned and the appellant commenced a claim for damages against him.

On May 12, 2021, the appellant sued the respondent, along with Mr. BG and Mr. AZ, for knowingly assisting Mr. CK in his alleged misdeeds with respect to trust funds held by the appellant and for repayment of consulting and management fees paid to the respondent. The appellant alleged that Mr. BG was prohibited by the Ontario Securities Commission from fund management activities in Ontario yet was the directing mind of the respondent and that Mr. AZ, the respondent’s CEO was merely the respondent’s public face. The appellant alleged that the respondent was established for the purpose of managing trust funds entrusted to Park Lawn and using the trust funds for Mr. CK.

Before the defendants had filed their defence to the action, the appellant’s new CEO, Mr. BG, made statements to Financial Service Insider, an industry newsletter available to subscribers. Mr. BG maintained that he had a moral and ethical duty to speak out about Mr. CK and his associates. He made statements about the respondent that were reported on July 12, 2021.

On July 28, 2021, the defendants delivered a statement of defence, and the respondent delivered a counterclaim alleging damages for breach of contract and defamation. The respondent joined Mr. BG as a co-defendant by counterclaim. The respondent alleges in the counterclaim that certain statements that referred to the respondent in the Funeral Service Insider article were defamatory.

The appellant brought an anti-SLAPP motion pursuant to s. 137.1 of the CJA to dismiss the defamation portion of the counterclaim.

issues:

(1) Did the motion judge err in concluding that respondent had proven sufficient harm caused by the defamatory statements?

(2) Did the motion judge err by failing to properly weigh any harm against the public interest in protecting Mr. Green’s expression on matters of public interest?

holding:

Appeal dismissed.

reasoning:

As noted by the Court, subsections 137.1(3) and (4) of the CJA set forth the test on an anti-SLAPP motion. Those subsections state:

(3) On motion by a person against whom a proceeding is brought, a judge shall, subject to subsection (4), dismiss the proceeding against the person if the person satisfies the judge that the proceeding arises from an expression made by the person that relates to a matter of public interest.

(4) A judge shall not dismiss a proceeding under subsection (3) if the responding party satisfies the judge that,

(a) there are grounds to believe that,

(i) the proceeding has substantial merit, and

(ii) the moving party has no valid defence in the proceeding; and

(b) the harm likely to be or have been suffered by the responding party as a result of the moving party’s expression is sufficiently serious that the public interest in permitting the proceeding to continue outweighs the public interest in protecting that expression.

The Court explained the “shifting burden” under s.137.1 of the CJA: (i) the onus is on the moving party (in this case, the appellants who were the defendants by counterclaim) to satisfy the motion judge that the proceeding arises from an expression relating to a matter of public interest; and (ii) if that burden is met, the responding party must then satisfy the motion judge that (a) there are grounds to believe that the proceeding has substantial merit and the moving party has no valid defence, and (b) the harm likely to be or that has been suffered is sufficiently serious that the public interest in permitting the proceeding to continue outweighs the public interest in protecting that expression.

The Court noted that, pursuant to ss. 137.1(7) and (8), there is a presumption that a successful moving party will be entitled to full indemnity costs but if the responding party is successful, it is presumptively not entitled to costs of the motion. As the motion judge on this appeal was aware, the Court found that this cost regime carried the potential for litigation tactics that were tethered to costs and expense rather than the merits of the case.

The Court also reviewed the purposes of s.137.1, which are expressly set forth:

The purposes of this section and sections 137.2 to 137.5 are,

(a) to encourage individuals to express themselves on matters of public interest;

(b) to promote broad participation in debates on matters of public interest;

(d) to reduce the risk that participation by the public in debates on matters of public interest will be hampered by fear of legal action.

In order to address the objectives of the legislation, the Court found that it bore repeating that the emphasis of the motion should be on the “crux” or “core” of the analysis, namely the weighing exercise. The Court found that this should not involve a trial of the issue or as some have put it, a “trial in a box”. In light of this, the Court suggested that, as a guideline, the costs of such a motion should not generally exceed $50,000 on a full indemnity basis, although there will be exceptions and motion judges always have the power to award less, more or nothing as they see fit in the circumstances of each case. The Court held that, typically, the conclusion should be obvious and one readily reached by a motion judge.

The Court also noted that a motion judge’s determination on a s. 137.1 motion will be entitled to deference on appeal absent an error in law or palpable and overriding error.

(1) No.

The appellant argued that the trial judge had erred by failing to identify or rely on any evidence of specific harm or causation. It was also submitted that any reputational harm to the respondent was limited given that its reputation was already blemished, the audience for the publication was restricted to subscribers, the respondent had no clients when the article was published and, in any event, it had only ever provided services to the appellant.

The Court held that, when examining the issue of harm, there is a distinction between the establishment of harm and the magnitude of the harm. The Court noted that the latter goes to the assessment of whether the harm is sufficiently serious that the public interest in permitting the proceeding to continue outweighs the public interest in protecting the expression. The Court, citing Lascaris v. B’nai Brith Canada, held that in assessing whether harm is sufficiently serious such that the public interest in permitting the proceeding to continue outweighs the public interest in protecting the expression, some statements are so likely to cause serious harm to a person’s reputation that the likelihood of harm being caused can be inferred.

The Court also noted that in Levant v. De Melle, the Court had held that harm can at times be presumed in defamation cases, but cautioned that presumed harm is generally insufficient for the purposes of s. 137.1, particularly where the plaintiff is a corporation whose reputation is not “unblemished”.

The Court found that the motion judge correctly described the legal principles applicable to the third part of the test on an anti-SLAPP motion and considered the appellants’ submissions on the elements of the test. The Court found that he had made numerous findings of harm and causation. First, the Court held that the motion judge found that the appellants had made an implicit concession that the respondent did suffer some damages. Second, the motion judge inferred that repetition of allegations of misconduct in the Funeral Insider Report would cause additional harm beyond the harm caused by the appellants’ lawsuit.

The Court found that it would be ironic for Mr. BG to make these statements in the hopes that they would convince others of the respondent’s misconduct, and then, for the purposes of the anti-SLAPP motion, assert that these statements could not have had any effect on the respondent’s reputation. Accordingly, the motion judge did not err regarding the harm analysis.

(2) No.

The Court held that the motion judge did not err in weighing exercise under s.137.1 of the CJA. The Court found that the motion judge wove his weighing throughout his reasons, and correctly applied the applicable law.

The Court also held that the motion judge was legitimately influenced by the fact that the litigation between the parties would not be resolved by granting the appellants’ motion, that the anti-SLAPP motion was inspired by strategic and tactical considerations, and that the appellants had assumed the risks associated with litigating outside the confines of the court proceeding.

Finally, the Court found that an anti-SLAPP motion seeking to dismiss a counterclaim may ultimately add expense and delay, which are anathema to the purposes of s.137.1 of the CJA.

Celestini v. Shoplogix Inc., 2023 ONCA 131

[Simmons, Paciocco and Zarnett JJ.A.]

Counsel:

M. A. Polvere and J. R. Leslie, for the appellants
D. Conn, for the respondent

facts:

Shoplogix was founded in 2002. SC was one of its co-founders, and he originally served as its CEO and then was given the position of CTO. Shoplogix and SC signed a written employment contract dated May 17, 2005 (the “2005 Contract”).

The 2005 Contract provided that Shoplogix could dismiss SC without cause by giving one month’s written notice and continuing to pay his base salary and group health coverage for 12 months from the date of termination. SC would also be entitled to be paid an amount equal to the bonus he received in the prior year, pro-rated for the period of the current year up to termination.

In 2008, SC and Shoplogix entered into an Incentive Compensation Agreement (“ICA”), a bonus plan for management-level employees. The motion judge found that it significantly changed SC’s compensation from the bonus arrangements in the 2005 Contract. Another change was the drastic reduction in the number of senior management personnel, which caused SC’s workload and responsibilities to increase substantially.

In 2017, the appellant, Shoplogix, dismissed the respondent, SC, from his employment, without cause. When it did so, Shoplogix took the position that SC’s rights were governed by an employment contract signed 12 years earlier, in 2005. The 2005 Contract provided that, upon a without cause termination, Shoplogix would pay SC’s base salary, and continue his group health insurance, for 12 months, and would make a pro-rated payment for his annual bonus accrued up to termination. It provided that these payments would be in full satisfaction of all claims arising out of the termination.

In applying the changed substratum doctrine, the motion judge found that SC’s responsibilities fundamentally and substantially increased over the course of his employment. SC was therefore entitled to damages at common law for the failure of Shoplogix to provide reasonable notice of termination. The motion judge found the appropriate notice period was 18 months. He awarded damages comprised of six additional months of base salary (in addition to the 12 Shoplogix had already paid), bonus entitlements SC would have received over the 18 month notice period less an amount for accrued bonus paid to him on termination, car allowance entitlements, and lost life insurance benefits. The total awarded was $421,043.05.

issues:

(1) Did the motion judge err in applying the changed substratum doctrine?

(2) On cross-appeal, did the motion judge err in deducting, from the damages award, the bonus payment that SC received at the time of termination?

holding:

Appeal dismissed. Cross-appeal allowed in part.

reasoning:

(1) No.

At the outset, the Court stated that the changed substratum doctrine operates as a limit on when an employee’s common law entitlements will be restricted by the express terms of a historical written contract. Given that an employer-employee relationship may evolve in a fundamental way after the written contract was made, the doctrine recognizes the potential inappropriateness and unfairness of applying the contract’s termination provisions to circumstances that were not contemplated at the time of contracting. The question of whether the changed substratum doctrine applies in any particular situation is one of mixed fact and law.

The Court held that to the extent that Shoplogix suggested that the doctrine could only apply to an employee who began in a non-executive role, there was nothing to support such a limitation either in the doctrine itself or the principle that underlies it. While the Court agreed that there must be a fundamental expansion, not a reduction, in the employee’s duties in order to engage the changed substratum doctrine, the Court held that this does not mean that in addition to that fundamental expansion of duties, a change in the employee’s formal title must also have occurred. The question of whether the “employee’s level of responsibility and corresponding status has escalated so significantly” was one of substance, not form. More important was whether there were actual increases, of a fundamental nature, in the duties and degree of responsibility of the employee. If there were, the employee was for all intents and purposes “promoted”, given their escalated status, even if the assigned title did not change.

The Court also held that the motion judge’s determination that the terms of the ICA did not clearly oust SC’s common law entitlement to damages for the loss of his ICA bonus was free of error. The motion judge properly considered this issue by applying the decision of the Supreme Court in Matthews v. Ocean Nutrition Canada Ltd. (“Matthews”). In Matthews, the Supreme Court adopted this court’s approach to interpreting bonus entitlement as set out in Paquette v. TeraGo Networks Inc., and Lin v. Ontario Teachers’ Pension Plan (“Lin”). The analysis was two-part: (1) would the employee have been entitled to the bonus or benefit as part of their compensation during the reasonable notice period?; and (2) if so, do the terms of the employment contract or bonus plan unambiguously take away or limit that common law right?

In applying this test, the Court stated that the ICA provided that if Shoplogix terminated SC’s employment for a reason other than cause, then Shoplogix would pay the bonus earned up to the date of termination. Like the clauses considered in Matthews and Lin, s. 2 of the ICA did not unambiguously oust SC’s right to damages upon the circumstances that actually arose, that is, a without cause termination without reasonable notice − termination without cause must be taken to mean a lawful termination following the reasonable notice period. Ultimately, the Court agreed with the motion judge that the ICA did not oust the right to common law damages representing the loss of bonus over the reasonable notice period.

Lastly, the Court held that calculations of damages are entitled to considerable deference on appeal and are not be interfered with in the absence of an error of law or principle, a misapprehension of evidence, or if palpably incorrect: SFC Litigation Trust v. Chan. Accordingly, the motion judge made no reversible error in adopting an averaging approach for the bonus entitlement that would have been earned in the notice period.

(2) Yes, in part.

It was the Court’s view that the motion judge’s decision to deduct the entire bonus payment Shoplogix made on dismissal was palpably incorrect. It credited a payment made to satisfy a Shoplogix obligation to pay bonus referable to the period up to March 2, 2017, against a Shoplogix obligation to pay bonus referable to an 18 month period following March 2, 2017. Shoplogix had both obligations, and performance of one did not reduce its obligation to perform the other except to the extent Shoplogix made an overpayment of its obligations. It is clear that the damages for lost bonus the trial judge calculated was for the reasonable notice period − that is, 18 months following March 2, 2017. It did not include the period before dismissal.

SC was entitled to be paid his bonus up to March 2, 2017 according to the ICA, not under the 2005 Contract. The formula used for calculating SC’s bonus entitlement for the period of 2017 prior to his dismissal should therefore be consistent with the formula used for determining his bonus entitlement in the reasonable notice period. Using the motion judge’s methodology, SC should have been paid $37,188.61 for the period up to termination. The motion judge ought to only have deducted, from the damages award, $13,365.83, the amount by which the payment SC received on termination for pre-dismissal bonus exceeded what he should have received for the period.

Maisonneuve v. Maisonneuve, 2023 ONCA 138

[Harvison Young, Thorburn and Copeland JJ.A.]

Counsel:

S. Hutt and E.L. Lacasse, for the appellants
J.S. Schoenholz, for the respondent JM

facts:

The appellants purchased investment properties on the advice of their former accountant, JM, who at the time was an employee of the corporate respondents. The transactions were conducted in 2013 and 2014. These investments proved to be unsatisfactory, and the appellants ended their relationship with the respondents in the spring of 2016. In January 2019, the appellants commenced an action against JM and the corporate respondents alleging that they had suffered losses of $1.75 million as a result of the respondents’ negligence, breach of contract, misrepresentations, and breach of fiduciary duty arising from JM’s conflict of interest.

The respondents brought a motion for summary judgment on the basis, in part, that the claim was statute-barred. The motion judge granted the motion on that basis and dismissed the action. The appellants submitted that the motion judge erred in finding that there was no genuine issue for trial on the grounds that the limitation period had begun to run as early as March 2016 and no later than December 2016. The appellants also sought leave to introduce fresh evidence.

issues:

(1) Should the appellants be permitted to introduce fresh evidence?
(2) Did the motion judge err in finding that there was no genuine issue for trial on the ground that the limitation period had passed?

holding:

Appeal dismissed.

reasoning:

(1) No.

The Court held that the appellants did not meet the test set out in Palmer v. The Queen (the “Palmer test”). The Court explained that even if the appellant’s fresh evidence met the due diligence aspect of the test, the Court did not accept the appellants’ submission that it moved the date of discoverability of the cause of action. The Court found that the relevance of the fresh evidence was tenuous and was not a material fact in relation to the pleaded causes of action. As such, the fresh evidence could not have affected the motion judge’s determination of the summary judgment as required under the fourth branch off the Palmer test.

(2) No.

The Court did not see any reversible error in the motion judge’s determination that the action was statute-barred and that there was no genuine issue requiring a trial. The appellants argued that, as unsophisticated investors, they did not know that a proceeding would be appropriate by December 2016 and thus, argued, they fell within s. 5(1)(a)(iv) of the Limitations Act. The Court agreed with the motion judge that the fact that the appellant, GM, stated that in February 2016, he did not necessarily think that a claim against the appellants would be an “appropriate” remedy, did not fall within the discoverability exception set out in s. 5(1)(a)(iv). The Court further agreed with the motion judge that GM was aware of JM’s involvement in the company Gro-Net, via a letter dated November 22, 2016.

Sumner v. Ottawa (Police Services), 2023 ONCA 140

[Harvison Young, Thorburn and Copeland JJ.A.]

Counsel:

J.A.S, acting in person
M. Simms, for the respondent

facts:

In February 2022, the appellant brought an action against the respondent, seeking injunctive relief to prohibit the Ottawa Police Service (“OPS”) from interfering with the appellant’s attempts to arrest Prime Minister Justin Trudeau. The appellant also sought injunctive relief requiring the OPS to take Justin Trudeau into custody for the crime of extortion under the colour of official right. The appellant sought damages in the total amount of $500,000.

The respondent filed a request under r. 2.1.01(6) that the action be dismissed pursuant to r. 2.1.01(1). That rule provides that the court may stay or dismiss a proceeding “if the proceeding appears on its face to be frivolous or vexatious or otherwise an abuse of the process of the court”. On appeal, the appellant submitted that the motion judge was wrong to dismiss the action and that in doing so, she too committed an act of extortion that benefitted Prime Minister Trudeau.

issues:

Did the motion judge commit a reversible error in dismission the proceeding for being frivolous and vexatious?

holding:

Appeal dismissed.

reasoning:

No.

The Court found that the motion judge thoroughly assessed the appellant’s statement of claim and submissions, and that her consideration of hallmarks of frivolous and vexatious proceedings were well grounded. The Court found that the motion judge carefully and accurately: (1) applied the procedure set out in r. 2.1.01(3), and considered the submissions and addressed them clearly; (2) set out the law and policy of r. 2.1.01, and noted that the abusive nature of the proceeding must be obvious on the face of the pleadings itself; (3) considered the statement of claim through the lens of r. 2.1.01 and the considerations articulated; and, (4) summarized the appellant’s submissions, finding hallmarks of frivolous and vexatious proceeding.

The Court agreed with the motion judge that there was no legal basis under Ontario or Canadian law that enables a person to obtain an injunction to require a police officer to arrest a potential offender. In addition, the Court agreed that the statement of claim was intelligible, consisting of legal conclusions and arguments rather than facts.

Ontario (Attorney General) v. Trinity Bible Chapel, 2023 ONCA 134

[Doherty, Zarnett and Sossin JJ.A.]

Counsel:

R. Kittredge and H. Kheir, for the appellants
J. Hunter, R. Cookson, M. Stevenson, and S. Kissick, for the respondent
A. Schutten and T. Ewert, for the intervener Association for Reformed Political Action

facts:

The appellants were two churches and their members who were charged with contravening several of Ontario’s COVID-19 regulations imposing capacity restrictions on indoor and outdoor religious gatherings in late 2020 and early 2021. They each brought motions to set aside court orders made against them on the basis that the authorizing regulations infringed s. 2 of the Canadian Charter of Rights and Freedoms.

The regulations at issue applied to organized public events, social gatherings, and gatherings for the purposes of conducting religious services, rites, or ceremonies. The appellants did not challenge those portions of the regulations that only imposed physical distancing requirements, but rather those imposing numerical or percentage capacity restrictions on indoor and outdoor religious gatherings, that were in force between December 2020 and July 2021.

The appellants asked that the challenged regulations be declared of no force and effect under s. 52(1) of the Constitution Act, 1982 and that the resulting orders against them be set aside.

The motion judge found the challenged regulations infringed the appellants’ right to freedom of religion under s. 2(a) of the Charter but were justified as a reasonable limit on that right in a free and democratic society. She declined to determine whether the regulations also infringed ss. 2(b)-(d) of the Charter as she found those protected interests were subsumed by s. 2(a) in this case.

The motion judge’s finding that s. 2(a) was infringed was not challenged on appeal. The appellants challenged the motion judge’s treatment of the expert evidence, her decision not to rely on “hindsight” evidence in evaluating the regulations, her decision not to consider the other alleged Charter breaches, and her conclusion that the regulations were justified under s. 1. The intervener, Association for Reformed Political Action (“ARPA”), made submissions on the third and fourth issues.

issues:

(1) Did the motion judge err in her treatment of the expert evidence?

(2) Did the motion judge err in declining to evaluate the challenged regulations through the lens of hindsight?

(3) Did the motion judge err in declining to conduct separate analyses under ss. 2(b)-(d) of the Charter?

(4) Did the motion judge err in finding the challenged regulations were justified under s. 1 of the Charter?

holding:

Appeal dismissed.

reasoning:

(1) No.
The appellants argued that the motion judge erred by admitting and relying on the opinion evidence of Dr. M, particularly in support of her findings that there was any risk of COVID-19 transmission outdoors and that Ontario’s gathering restrictions reduced infection rates. They submitted that he was a fact witness, not a properly qualified expert witness, and for this reason did not complete the Acknowledgement of Expert’s Duty form under r. 53.03 of the Rules of Civil Procedure.
The respondent highlighted that the appellants did not object to the admissibility of Dr. M’s evidence in the court below. In fact, the appellants had relied on Dr. M’s evidence to support their s. 1 argument. Thus, no substantial wrong or miscarriage of justice occurred. The Court accepted that Dr. M was a participant expert who was not required to comply with r. 53.03 and whose evidence was admissible for the truth of its contents. The Court held that the motion judge was entitled to consider Dr. M’s evidence as a participant expert and stated that the time to object to evidence is when it is put before the judge, not after the judge renders a decision.
The appellant also took issue with the motion judge’s reliance on the evidence of Dr. H, an emergency physician and certified specialist in public health, as well as her failure to rely on that of Dr. C, an infectious diseases physician, and Dr. S, a doctor specializing in public health and internal medicine.
The appellant argued that Dr. H’s testimony that provincial case count numbers accounted for 90% of community cases was clearly false, calling into question his credibility and impartiality, and further pointed out that he did not in fact advise the government on the religious gathering restrictions.
The appellant noted that Dr. C worked on certain provincial COVID-19 guidelines while Dr. S was a former Chief Medical Officer of Health for Ontario. The appellant argued that the motion judge’s decision to give greater weight to the evidence of Drs. H and M while discounting other experts was a palpable and overring error.
The respondent submitted that there was no reason to interfere with the motion judge’s weighing of the expert evidence. Conflicting evidence was not sufficient to establish a palpable and overriding error. The motion judge was not required to address the specific inconsistency raised by the appellants. The issue was peripheral and both Drs. H and C agreed that the number of cases captured by testing was inherently uncertain and that different experts used different data when estimating the proportion of cases that go unreported.
The Court found the motion judge was entitled to rely on all, part, or none of the expert evidence. Her treatment of the evidence was open to her on the record before her, and the purpose of appellate review was not to reassess the weight accorded to such evidence.

(2) No.
The motion judge stated that she was not reviewing the regulations through the standard of hindsight. The appellants alleged the motion judge unduly narrowed her analysis and that this approach insulated laws from scrutiny when new information reveals they had always been unjustified.
The respondent argued that evaluating the challenged regulations based on information that was not available at the time would set an impossibly high standard for governments to justify an infringement. S. 1 should not require governments to predict the future or prevent them from acting on imperfect information.
The Court found that the motion judge had reiterated the dispute before her related to the scientific and policy understandings at the time the regulations were enacted. Additionally, the motion judge was highlighting the importance of context in the analysis, particularly the absence of scientific certainty regarding COVID-19.

(3) No.

The appellants submitted that the motion judge erred by declining to consider and rule separately on the alleged violations of the appellants’ rights to freedom of expression under s. 2(b), freedom of assembly under s. 2(c), and freedom of association under s. 2(d). First, they argued that Trinity Western, was distinguishable since the parties in that case had almost exclusively framed the dispute as centering on religious freedom whereas the appellants made full arguments before the motion judge on the other breaches. They argued that the motion judge erred by finding their s. 2(a) claim “subsumed” the others and should have instead applied the analysis from Ross v. New Brunswick School District No. 15 where the Supreme Court considered both the ss. 2(a) and 2(b) claims.

Second, the appellants and the intervener argued that the motion judge’s failure to consider each freedom separately impacted her application of the Oakes test, particularly in the final balancing of deleterious and salutary effects.

The respondent argued that the motion judge’s decision was consistent with Trinity Western and the principle that courts should decline to address constitutional issues unless it is necessary to do so. The allegations all related to the “single compendious act” of imposing limits on religious gatherings and the motion judge considered all relevant salutary and deleterious effects in the proportionality analysis. In the alternative, the respondent contended that no ss. 2(b), (c), or (d) breach occurred.

(a) Can one Charter right “subsume” others?

The Court found the alleged infringement of the appellants’ s. 2(a) rights accounted for their related rights to express their religious beliefs, assemble for the purpose of engaging in religious activity, and associate with others who share their faith. While the appellants suggested that certain expressive activities took the form of political protest protected under s. 2(b), those activities were directly related to the government restrictions on religious gatherings. The motion judge noted that her finding that s. 2(a) was infringed accounted for these various manifestations of religious freedom, concluding, “There is no value added by repeating or repackaging the analysis under different constitutional headings.”

The Court found that the authorities relied on by the appellants did not assist them. First, none of the cases stood for the proposition that every alleged Charter infringement must always be considered. Rather, it was an inference the appellants had asked the Court to draw from the separate analysis undertaken by the court for each Charter claim. Second, the cases were distinguishable on their facts.

Therefore, where an examination of the factual matrix revealed that one claimed s. 2 right subsumes others, it was not necessary to consider the other s. 2 claims. The Court stated this approach was particularly apposite in the s. 2 context where the rights were related fundamental freedoms, whereas it may have less application across rights (for example, as between ss. 2, 7, and 15 rights).

The appellants further submitted that while the challenged regulations infringed the right to religious freedom in effect, they infringed the right to peaceful assembly in purpose. They suggested this should be given more weight in the proportionality analysis. However, the Court stated that if the appellants were correct, then the same logic could apply to the s. 2(a) infringement because the regulations specifically restrict religious gatherings. The Court noted that the appellants did not challenge the restrictions that applied to non-religious gatherings, such as social gatherings or other public events. Thus, the Court found the distinction the appellants attempted to draw was one without a difference.

(b) Are multiple breaches considered cumulatively under the Oakes analysis?

The Court disagreed with the appellants and the intervener that the Oakes test changes where there are multiple breaches of the Charter. The appellants cited no authority to support that the s. 1 proportionality analysis must consider Charter breaches in a cumulative way. However, even if the motion judge expressly had found infringements of ss. 2(b)-(d), the Court was not persuaded that this would have led to a different result, as those same protected interests were considered at the proportionality stage.

The third step of the proportionality exercise directed that “there must be a proportionality between the effects of the measures which are responsible for limiting the Charter right or freedom, and the objective which has been identified as of ‘sufficient importance’”. Courts are directed to assess the extent, degree, and severity of the effects, but the Court cautioned that this does not mean multiple infringements necessarily enhanced the weight of the harms.

The only proffered authority for considering the cumulative effects of multiple Charter breaches came from the s. 24(2) jurisprudence, R. v. Poirier. The motion judge distinguished this case, and the applicability of s. 24(2) cases in general, on the basis that each breach stemmed from a separate act. The Court stated they would add a more fundamental difference was that the test to exclude evidence obtained in a manner that infringes the Charter, as set out in R. v. Grant, was different than the proportionality analysis in Oakes.

Section 24(2) has developed its own body of case law, distinct from remedies under s. 24(1) of the Charter and s. 52(1) of the Constitution Act, 1982. Analytically, the burden of proof rests on the person seeking to exclude evidence, rather than the Crown. Furthermore, the focus of s. 24(2) was solely on the administration of justice, not what was reasonable and demonstrably justified in a free and democratic society. The Court was not aware of any cases borrowing concepts from the s. 24(2) jurisprudence to inform the s. 1 analysis. In the Court’s view, neither necessary nor justified for purposes of resolving this appeal to exclude the possibility that the effects of multiple Charter infringements could have a bearing on the Oakes analysis in future cases.

(c) Conclusion on cumulative breaches

The Court found the motion judge did not err in relying on Trinity Western for the proposition that, having found the challenged regulations infringed the appellants’ Charter right to freedom of religion, she did not need to separately consider the alleged infringements of ss. 2(b), (c), and (d).

(4) No.

The appellants contended that throughout the motion judge’s Oakes analysis, the motion judge was “excessively deferential” to Ontario, and that she erred at each step of the test.

(a) Pressing and substantial objective

The Court saw no error in the motion judge’s identification of the objective, nor in her conclusion that it met the pressing and substantial threshold. Nor did the Court find the s. 1 analysis would substantially change if the appellants’ formulation of the objective were adopted.

The motion judge also addressed the appellants’ argument that Ontario’s objective was not legitimately connected to outdoor gatherings, observing that this was more relevant to rational connection and particularly minimal impairment, where she chose to address it. It was open to the motion judge to address this at either or both of those stages of the Oakes analysis.

(b) Rational connection

The Court found the motion judge properly instructed herself on the test for whether a challenged law is rationally connected to its objective. She recognized that the government “must show a causal connection between the infringement and the benefit sought on the basis of reason or logic” and that it is reasonable to suppose the limit may further the objective in question.

The Court found it was open to the motion judge to accept the evidence in the record that outdoor gatherings, while reducing the risk of transmission, did not eliminate it, and that any increased risk of transmission could have consequences for the health care system more broadly. While certain experts disagreed with this assessment, merely pointing to some conflicting expert evidence was not sufficient to establish a palpable and overriding error. The Court agreed with the motion judge that Ontario was not required to scientifically prove that the challenged regulations in fact reduced the spread of COVID-19.

(c) Minimal impairment

The appellants argued that the analogy to Hutterian Brethren was misplaced and that the challenged regulations were more akin to criminal sanctions which should attract stricter scrutiny at the minimal impairment stage.

The Court disagreed stating there were important distinctions between Hutterian Brethren, where a statute of general application (involving the requirement to have photos on driver’s licenses) adversely affected a particular religious group, and in this case, where regulations targeted religious gatherings specifically.

The Court found the motion judge did not err in identifying that deference under the minimal impairment stage of the Oakes analysis was contextual. The Court stated that deference was not a free-floating concept that moves up and down a spectrum. Nor was it a blank cheque whenever governments were faced with a challenging policy issue. Rather, it took its meaning from the context of the challenged law or state action. In this case, the COVID-19 pandemic required Ontario to act on an urgent basis, without scientific certainty, on a broad range of public health fronts. That context not only informed the degree of deference owed to government as the crisis shifted on the ground in real time, but also the heightened importance of vigilance by all branches of government over fundamental rights and freedoms during such times of crisis.

This context also represented the point of departure for the motion judge’s treatment of the precautionary principle and comparisons between the treatment of religious gatherings and other congregate settings. The appellants argued that the motion judge erred in her minimal impairment analysis by adopting the precautionary principle and rejecting the comparison between Ontario’s restrictions on religious gatherings and the retail sector.

The Court found the motion judge did not err in her treatment of the precautionary principle. The motion judge framed the question of whether the challenged regulations were minimally impairing against the evolving understanding of COVID-19 transmission when the various regulations were enacted. The Court found it was appropriate for the motion judge to consider the precautionary principle as informing whether and how the state could meet its objectives of reducing transmission risk and saving lives in a situation of scientific uncertainty. The Court held that this accords with the contextual approach to the Oakes test.

A reasoned or reasonable apprehension of harm does not mean governments can justify infringing Charter rights based on apprehension alone. The minimal impairment analysis still requires an evidentiary basis to show why a measure is a reasonable means of achieving a pressing and substantial objective. While not a constitutional standard, the precautionary principle helps inform what it means to rely on a reasoned apprehension of harm where scientific certainty is not possible. The Court found this application of the precautionary principle was consistent with the jurisprudence and did not introduce an excessively deferential standard into the s. 1 analysis.

The Court also found the motion judge did not err in rejecting the analogy between religious gatherings and the retail sector. It was open to the motion judge to reject the analogy between retail settings and religious gatherings based on the public health rationale. However, the Court noted that even if this differential treatment could not be justified on public health grounds, that would not determine whether the challenged regulations were sufficiently tailored to be minimally impairing. Ontario was entitled to balance the objective of reducing the risk of COVID-19 transmission in congregate settings with other objectives that did not arise in the context of regulating religious gatherings, such as preserving economic activity and preserving other social benefits which that activity made possible.

The Court stated that the challenged regulations included careful tailoring and that the government limited but did not ban religious gatherings. The Court noted that less restrictive measures were generally imposed for religious gatherings than for public events and the restrictions were time-limited and regularly revisited. Alternatives such as virtual or drive-in gatherings were available to permit at least some aspects of religious gatherings during the period of the restrictions.

The Court saw no error in the motion judge’s conclusion that the challenged regulations fell within a range of reasonable alternatives to address the ongoing threat of the pandemic.

(d) Salutary and deleterious effects

The Court found the motion judge properly instructed herself on the balancing exercise at the final stage of the Oakes analysis. The motion judge stated that while the perspective of a religious claimant is important, it must be considered in the context of a multi-cultural, multi-religious society where the public interest as expressed through state action may conflict with individual beliefs.

In the Court’s view the motion judge’s reference to Ontarians’ “constitutional rights” to public health measures was not a reference to a positive s. 7 right, but rather to the potential infringement of the Charter rights of Ontarians had the government taken steps to address the COVID-19 pandemic that aggravated the threat it posed. More broadly, the motion judge considered that the salutary effects of the challenged regulations were not just beneficial to wellbeing, but potentially life-saving, both for religious congregants and for other Ontarians. The Court noted that her rhetorical flourish did not constitute an error.

The Court found the motion judge did not downplay the negative effects experienced by the appellants, including the impact on the psychological wellbeing of congregants and their ability to “facilitate dissemination of religious content” and to “engage in religious activity as a collective in-person congregation”. She did, consider those effects in the context of the burdens and sacrifices borne by many individuals and communities across Ontario in the interests of public health. Further, she balanced these burdens against the benefits of the regulations.

The Court saw no error in the motion judge’s assessment of the deleterious effects and salutary benefits of the challenged regulations, nor in her overall conclusion that the challenged regulations were justified under s. 1 of the Charter.

Jovkovic v. DaSilva, 2023 ONCA 137

[Brown, Sossin and Copeland JJ.A.]

Counsel:

M.A. van Bodegom and B.J. Carter, for the appellant
J.R.D. Clark, for the respondent

facts:

The appellant, CD, and her husband SMD, acquired property located in Cambridge, Ontario (the “Property”) as joint tenants for consideration of $237,000 in November 2004. On June 10, 2016, approximately one year after the respondent, DJ, had commenced an action against SMD, SMD transferred his one-half interest in the Property to CD for consideration of $0. At the time, the fair market value of the Property was $380,000.

On September 11, 2017, SMD granted a mortgage on the Property of $550,000 to the Royal Bank of Canada. Two months later, SMD filed for an assignment in bankruptcy.

In January 2019, the respondent obtained judgment against SMD and his corporation for approximately $427,000. In June 2021, the respondent obtained authorization under s. 38 of the Bankruptcy and Insolvency Act (the “BIA”) to commence a proceeding for an order that SMD’s transfer of his one-half interest in the Property to his wife was void as a transfer for undervalue. The respondent commenced an application and SMD’s other creditors joined. By judgment dated May 27, 2022, the application judge declared, pursuant to s. 96 of the BIA, that the Transfer was a transfer for undervalue, void against the trustee, and set it aside.

issues:

(1) Did the application judge err by declaring that the transfer was a “transfer at undervalue”?
(2) Did the application judge err in finding that SMD was insolvent at the time of the transfer?
(3) Did the application judge err in finding that SMD’s conduct was indicative of an intention to defraud, defeat or delay his creditors?

holding:

Appeal dismissed.

reasoning:

(1) No.

The Court held that the application judge did not err in finding that the transfer was at undervalue. The appellants argued that the application judge erred in finding that the transfer was at undervalue because she treated the value of her husband’s one-half interest in the Property as 50% of the gross fair market value of the Property without considering the amount of the encumbrances on the Property. The Court did not accept this argument as s. 96(1) of the BIA defines a “transfer at undervalue” as a disposition of property for which no consideration is received by the debtor or for which the consideration received is conspicuously less than the fair market value of the consideration given by the debtor.

(2) No.

The Court found no palpable and overriding error, holding that the application judge’s findings were firmly anchored in the record as a whole, including the answers given by SMD on his examination by the Official Receiver and the evidence of other creditors that SMD was insolvent.

(3) No.

The Court held that the application judge did not err in finding that SMD’s conduct was indicative of an intention to defraud, defeat or delay his creditors because the application judge did not make a finding regarding SMD’s intention to defeat creditors. The application judge’s comments in this regard were obiter.

Aslezova v. Khanine, 2023 ONCA 153

[Roberts, Nordheimer and Favreau JJ.A.]

Counsel:

E. Karp and I. Literovich, for the appellant
A. Feldstein and A. Troitschanski, for the respondent

facts:

The parties were married for about 20 years before they separated in 2017. Following a multi-day case conference before Bennett J. culminating on September 10, 2021, the parties settled the issues of parenting time, decision-making and the residence of the children. They also agreed on a detailed order providing for the appellant’s financial disclosure relating to millions of dollars in corporate and other assets (the “Disclosure Order”). The appellant was required to produce the documents or directions for their production, if they existed, within 45 days of the Disclosure Order. If the appellant could not produce them, he had to provide an affidavit explaining his efforts to obtain them and why he could not obtain them within 60 days of the Disclosure Order.

The appellant did not provide the necessary documents within the required time frame. After six months, the respondent brought a motion to strike the appellant’s pleadings based on his non-compliance with the Disclosure Order. The appellant responded by producing some, but not all, of the requested documents. Further many of the documents he provided were in Russian, without a translation. In the circumstances, based on the appellant’s ongoing refusal to comply with the clear provisions of the Disclosure Order and his noted history of non-compliance with other court orders, the motion judge struck the appellant’s pleadings.

issues:

Did the motion judge err in striking out the appellant’s pleadings?

holding:

Appeal dismissed.

reasoning:

No.

The appellant argued that the motion judge ought to have made a less onerous order giving him another chance to comply with the Disclosure Order. He argued that the striking of pleadings is a remedy of last resort that should only be ordered in the most exceptional of cases, and that his conduct did not meet this threshold.

The Court stated that the motion judge decision to strike out the appellant’s pleadings was entitled to deference and it found no reversible error. Section 1(8) of the Family Law Rules permitted the court to make any order that it considered necessary for a just determination of the matter, including an order to strike out pleadings. The Court noted that this is an extraordinary remedy, and such a decision is driven by the particular facts of each case, including the importance or materiality of the items of disclosure not produced. Further, those who choose not to disclose financial information or to ignore court orders will be at risk of losing their standing in the proceedings as their claims or answers to claims may be struck.

The appellant’s submission not only ignored the plain reality that he was in ongoing breach of his disclosure obligations but also his failure to comply with other orders including support payments. Further, the respondent ought not to have been put to the expense and effort of bringing a motion to ensure the appellant’s compliance. The Court noted that the obligation to provide financial disclosure in a case such as this did not simply flow from the disclosure order, but also more broadly from fundamental principles of family law. Financial disclosure ought to be automatic and should not require a court order.

The Court concluded that the appellant’s financial disclosure obligations arose at and were ongoing from the commencement of the proceedings in 2017. As a result, his conduct as found in ignoring court orders and failing to comply with his basic disclosure obligations put him in the exceptional category of cases where the judge’s discretion to strike his pleadings was reasonably exercised.

SHORT CIVIL DECISIONS

Sunlight General Capital LLC v. Effisolar Energy Corporation, 2023 ONCA 133

[Harvison Young, Thorburn and Copeland JJ.A.]

Counsel:

A. Rouben, for the appellant
J. Wuthmann and D. Steinberg, for the respondent

Everest Finance Corporation v. Jonker, 2023 ONCA 146

[Huscroft, Miller and Nordheimer JJ.A.]

Counsel:

D.G. Boghgosian and G.M. Pakozdi, for the appellant
R.J.J., acting in person

Keywords: Costs, Full Indemnity, MCAP Financial Corp. v. George Fernicola in Trust and Carrington Homes Ltd., 2010 ONSC 148

Daly v. Ontario (Landlord and Tenant Board), 2023 ONCA 152

[Pepall, Roberts and Nordheimer JJ.A.]

Counsel:

J.D., acting in person
B. Blumenthal, for the respondent, The Landlord and Tenant Board
K. Leung, for the respondent, His Majesty the King in Right of Ontario and the Attorney General of Ontario

Adejuyigbe v. Boynton, 2023 ONCA 141

[Pepall, Nordheimer and Favreau JJ.A.]

Counsel:

O.G. Barnwell, for the appellant
B. O’Connor and J. Hadlaw-Murray, for the respondents

Rudin-Brown v. Brown, 2023 ONCA 151

[Roberts, Nordheimer and Favreau JJ.A.]

Counsel:

G.R.B., acting in person
J.A. Christian, for the respondents

Keywords: Wills and Estates, Loss of Capacity, Power of Attorney for Property and Personal Care, Meritless Appeal, Costs, Substantial Indemnity, Lewis v. Lewis, 2019 ONCA 690

2343680 Ontario Inc. v. Talpade, 2023 ONCA 154

[Roberts, Nordheimer and Favreau JJ.A.]

Counsel:

T.T. and V.T., acting in person
M.I. Rotman and Y. Jaimangal, for the respondents 2343680 Ontario Inc., M.A. and L.D.
A. Sidhu, for the respondents J.P. and Canada Lend

Keywords: Mortgagee and Mortgagor, Default, Enforcement, Bias and Prejudice, Procedural Fairness, Palkowski v. Ivancic, 2009 ONCA 705, Housen v. Nikolaisen, 2002 SCC 33

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Ines Ferreira Blaney McMurtry LLP 416.593.2953 Email

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CIVIL DECISIONS

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Ines Ferreira Blaney McMurtry LLP 416.597.4895 Email

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CIVIL DECISIONS

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John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Ines Ferreira
Blaney McMurtry LLP
416.593.2953 Email

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Ines Ferreira
Blaney McMurtry LLP
416.597.4895 Email

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Ines Ferriera
Blaney McMurtry LLP
416.597.4895 Email