Good afternoon.

Here are this week’s Court of Appeal Summaries. Civil topics covered include administrative law/professional discipline (chiropractors), family law (support), contracts, civil procedure in the corporate oppression context (order interlocutory or final for appeal purposes), insurance law (SABs) and commercial tenancies. Special mention to our partner, Reeva Finkel, who on behalf of our client successfully resisted a landlord’s attempt to improperly terminate our client’s tenancy.

Have a great weekend and a Happy Halloween! Please watch out for children when driving home on Monday evening.

John Polyzogopoulos
Blaney McMurtry LLP
jpolyzogopoulos@blaney.com
Tel: 416.593.2953
http://www.blaney.com/lawyers/john-polyzogopoulos

Table of Contents

Civil Decisions (click on case name to read summary):

Dragona Carpet Supplies Ltd. v. Earl O’Neil Electric Supply Limited, 2016 ONCA 783

Keywords: Real Property, Commercial Tenancies, Leases, Termination, Illegality, Relief from Forfeiture, Commercial Tenancies Act, ss 19(2), 20(1), Courts of Justice Act, s 98, Evidence on Motions, Affidavits, Rules of Civil Procedure, Rule 39.01(5), Fresh Evidence

Buccilli v. Pillitteri, 2016 ONCA 775

Keywords: Appeals, Motions to Quash, Jurisdiction, Final or Interlocutory Orders, Corporate Law, Oppression, Ontario Business Corporations Act, s. 248, Breach of Fiduciary Duty

Reid v. College of Chiropractors of Ontario, 2016 ONCA 779

Keywords: Administrative Law, Regulated Professions, Chiropractors, Regulated Health Professions Act

Squires v. Crouch, 2016 ONCA 774

 Keywords:  Family Law, Spousal Support, Imputed Income, Spousal Support Advisory Guidelines, Lefebvre v. Gowan

Norton McMullen Consulting Inc. v. Boreham, 2016 ONCA 778

Keywords: Contracts, Summary Judgment

Ayr Farmers Mutual Insurance Company v. Wright, 2016 ONCA 789

Keywords: Insurance Law, Insurance Act, Statutory Accident Benefits, ss 279 to 283, Entitlement, Mediation, Arbitration, Statutory Interpretation, Rizzo & Rizzo Shoes Ltd. (Re), [1998] 1 S.C.R. 27, Definition of “Accident”, “Insured Person”

Civil Endorsements (Click Here for Decisions)

Criminal Decisions (Click Here for Decisions)

 

Dragona Carpet Supplies Ltd. v. Earl O’Neil Electric Supply Limited, 2016 ONCA 783

[Gillese, Pepall and Roberts JJ.A.]

Counsel:

W.V. Reid, for the appellant

R. Finkel, for the respondent

Keywords: Real Property, Commercial Tenancies, Leases, Termination, Illegality, Relief from Forfeiture, Commercial Tenancies Act, ss 19(2), 20(1), Courts of Justice Act, s 98, Evidence on Motions, Affidavits, Rules of Civil Procedure, Rule 39.01(5), Fresh Evidence

Facts:

The appellant appeals from the application judge’s order, granting the respondent relief from forfeiture of its commercial sublease with the appellant.  The appellant also seeks to file fresh evidence on appeal.

The appellant is the tenant under a head lease of commercial premises at 85 Progress Avenue in Toronto, a portion of which it sublet to the respondent pursuant to a sublease. The term of the respondent’s sublease ends in June 2018. Although served with the application, the landlords under the head lease have taken no position in these proceedings.

The appellant served two notices of termination of the sublease for alleged breaches, other than non-payment of rent, dated respectively September 23 and November 25, 2015. There was no dispute that the respondent was current in its rent payments to the appellant.

The appellant’s first notice of termination alleged that the respondent was in breach of the sublease because its principals and employees had been charged with criminal activity and the police had executed a search warrant as part of an investigation into stolen hardwood flooring products, creating a nuisance; and because the respondent had stored numerous used vehicles at the premises. Contrary to the head lease, which allowed ten days to remedy any breach, and contrary to s. 19(2) of the Commercial Tenancies Act, R.S.O. 1990, c. L.7, which gives a reasonable time to remedy any breach, other than non-payment of rent, the notice gave no time to remedy the alleged breaches.

The second notice alleged that the respondent had breached art. 12.07(e) of the head lease by allowing Dragona Flooring (a company owned by the sons of the respondent’s owners) to store hardwood flooring in the respondent’s subleased space. This notice gave the respondent ten days to remedy the breach. Further, it alleged that the respondent had breached art. 6.01 of the head lease by acquiescing to this use, which the appellant maintained was criminal activity.

The respondent brought an application for a declaration that the sublease was in good standing and the notices of termination were invalid; in the alternative, the respondent sought relief from forfeiture of the sublease.

The application judge held that the appellant’s first notice of termination was invalid. The appellant had failed to give notice to the respondent to remedy the alleged breaches. Moreover, the alleged criminal activity related to Dragona Flooring, whose principals and employees were charged, and not to the respondent, its principals or employees, who were not charged, and the respondent and Dragona Flooring were independent companies.

With respect to the second notice, the application judge held that the appellant had not demonstrated that any criminal activity had taken place or that the respondent had allowed or acquiesced in any criminal activity. He agreed that the respondent had breached art. 12.07(e) of the head lease by allowing Dragona Flooring to store hardwood flooring on the premises. However, pursuant to s. 20(1) of the Commercial Tenancies Act and s. 98 of the Courts of Justice Act, R.S.O. 1990, c. C.43, he granted the respondent relief from forfeiture of the sublease.

Issues:

  1. Did the application judge err in finding that there was no criminal activity taking place at the subleased premises? Specifically, whether the application judge erred in finding that the respondent did not store or permit Dragona Flooring to store stolen hardwood flooring at 85 Progress Avenue?
  2. Is the appellant entitled to file fresh evidence in the appeal?

Holding: The motion to admit fresh evidence and the appeal were dismissed.

Reasoning:

  1. There was no error of law or palpable or overriding error that would allow appellate interference with the application judge’s findings that no criminal activity was taking place at the premises and that the respondent had allowed or acquiesced in it. There was no basis for interfering with the application judge’s findings that were based on the admissible evidence before him. No affidavit or other sworn evidence from the American victims of the flooring theft, nor from the police, was filed in response to the application. With respect to the contents of affidavits for use on applications, r. 39.01(5) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, only permits statements of a deponent’s information and belief with respect to facts that are not contentious, and only if the source of the information and the fact of the belief are specified in the affidavit. The allegations concerning criminal activity at the premises were highly contentious.
  2. The proposed fresh evidence does not constitute an acknowledgement by the respondent that criminal activity was occurring, adds nothing to the positions of the parties considered by the application judge, and does not otherwise support the appellant’s submissions. In the court’s view, the proposed fresh evidence, if admitted, would not have affected the outcome of the application.

Buccilli v Pillitteri, 2016 ONCA 775

[Cronk, Rouleau and Huscroft JJ.A.]

Counsel:

T. M. Slahta, for the moving parties

L. Galessiere and A. Smith, for the respondents

Keywords: Appeals, Motions to Quash, Jurisdiction, Final or Interlocutory Orders, Corporate Law, Oppression, Ontario Business Corporations Act, s. 248, Breach of Fiduciary Duty

Facts:

This was a motion by the plaintiffs seeking to quash an appeal by the defendants of an order wherein the defendants were ordered to make interim payments to the plaintiff pending a later trial to determine what further remedies are available to the plaintiffs.

The dispute concerned a claim by the plaintiffs that one or more of the individual defendants deprived the plaintiffs of their interest in various corporations, including the defendant corporations. The plaintiffs obtained a declaration that the plaintiffs had a one-third interest in the defendants, Patron Contracting Limited and Birchland Homes Inc., as well as in all monies, benefits and opportunities withdrawn or diverted directly or indirectly from those companies, including but not limited to various real estate investments.

Pending another phase of the trial to determine the value of the plaintiffs’ declared interests, and the appropriate equitable and monetary remedies under the OBCA, the plaintiffs brought a motion pursuant to s. 248(3)(j) of the OBCA and r. 20 of the Rules of Civil Procedure seeking substantial interim payments and other declaratory relief. The motion judge granted much of the relief sought and, assessing the value of the plaintiffs’ one-third interest in various properties and investments, ordered the defendants to make payments totalling $6,098,427 plus the plaintiffs’ proportionate share of “other legal expenses” as that term is defined in the order, together with costs fixed at $170,000. The defendants appealed from that order, and that appeal is to be heard in December of this year.

The moving parties moved for an order quashing the defendants’ appeal for want of jurisdiction, based on three grounds. First, the moving parties argued that the order was not a final order. Second, the moving parties argued that if any of the relief granted was in fact final, it was awarded pursuant to the OBCA and that appeals from such orders (final or interlocutory) are properly made to the Divisional Court pursuant to s. 255 of the OBCA. Finally, the moving parties argued that the appeal should be quashed as being manifestly devoid of merit.

Issues:

  1. Whether the order was final.
  2. Whether the order constituted relief granted pursuant to the OBCA.
  3. Whether the appeal was devoid of merit.

Holding: Motion dismissed.

Reasoning:

  1. Yes. The order was not simply an order requiring payment of sums representing the minimum amounts that will be recovered at the second phase of the trial. The order determines the moving parties’ entitlement to minimum set amounts for their interest in each of several disputed properties or investments. In some cases, the motion judge was presented with two market value appraisals for a disputed property and he used the lower of the two. He left to the phase two trial the final determination of the correct market value. Although he used the lower of two appraisals as a starting point, the judge then determined what reductions he would or would not allow the responding parties to make to those values because of costs alleged to be incurred. This involved the final determination of several disputed issues. The respondents are prevented by reason of the order from challenging the minimum payments and arguing at the phase two trial that the deductions the motion judge rejected ought to be accepted. The order, therefore, is final.
  2. No. The decision was rooted in a finding that the responding parties breached their fiduciary duties and inequitably deprived the moving parties of their interests in several corporations. The motion judge concluded that there were sufficient grounds on which to decide in favour of the plaintiffs under the doctrines of undue influence, unconscionability, misrepresentation and breach of fiduciary duty. The order for an accounting of profits and payment of one-third to the plaintiffs was expressly framed as a remedy to make the moving parties whole from the breach of fiduciary duty. These were common law or equitable claims, meaning that the relief later granted by the motion judge giving effect to that judgment is likewise rooted in a common law or equitable claim. The fact that the moving parties included OBCA claims in their statement of claim and again in their motion for partial summary judgment does not change the essential nature of the claim. The Court noted that even if it was to assume that part of the relief was grounded in an OBCA claim and was granted pursuant to s. 248(3), the Court would still have jurisdiction to hear the appeal from all aspects of the order pursuant to s 6(2) of the Courts of Justice Act. This is because those parts of the order under appeal that are rooted in the OBCA are final orders that, although appealable to the Divisional Court, may be joined to the appeal of the parts of the order that are not rooted in the OBCA.
  3. The appeal had already been scheduled for hearing later in the year and in light of the very limited argument on the merits of the appeal itself, the Court was not, on a motion, prepared to conclude that the appeal was devoid of any merit. The Court dismissed the motion and awarded the responding parties their costs of the motion ($5,000 inclusive of disbursements and applicable taxes).

Reid v. College of Chiropractors of Ontario 2016 ONCA 779

[Epstein J.A. (in chambers)]

Counsel:

Z. N. Hakamali, for the moving party

C. Paliare and K. Jones, for the responding party

Keywords: Administrative Law, Regulated Professions, Chiropractors, Regulated Health Professions Act

Facts:

Dr. Reid, a chiropractor, has been the subject of disciplinary proceedings that arose out of a series of complaints made to the College by a fellow chiropractor, Dr. Chris Paynter, and his wife, involving Dr. Reid’s advertising practices. The College reprimanded Dr. Reid and issued two cautions against him. In 2010, Dr. Paynter and his wife made a further complaint to the College about Dr. Reid’s advertising practices. That complaint resulted in a Discipline Committee hearing (the “2012 Hearing”) that proceeded by an agreed statement of facts. Dr. Reid was found guilty of professional misconduct and was ordered to enter into an undertaking to abide by the College’s policies.

Between the time Dr. Paynter complained to the College in 2010 and the 2012 Hearing, Dr. Reid made three telephone calls to Dr. Paynter and visited his clinic twice. After the 2012 Hearing, Dr. Reid sent two emails to Dr. Paynter. Dr. Paynter complained to the College about these contacts and communications.

After five months had elapsed without receiving a response from Dr. Reid, the College appointed an investigator. The investigator experienced difficulty dealing with Dr. Reid. Five allegations of professional misconduct arising out of Dr. Reid’s conduct toward Dr. Paynter, his failure to reply to the College’s requests for a response to complaints made against him and his treatment of the investigator became the subject of a Discipline Committee hearing that took place in 2014 and 2015 (the “2014-5 Hearing”).

The Panel imposed a penalty of a twelve month suspension of Dr. Reid’s license, remedial measures and a fine of $10,000 for professional misconduct. The Panel ordered Dr. Reid to pay the College’s costs in the amount of $166,194.50. Dr. Reid appealed the Panel’s decision as to costs (the “Costs Decision”), as to liability, including the issue of bias (the “Liability Decision”), and as to penalty (the “Penalty Decision”) separately to the Divisional Court. The three appeals were heard on February 11, 2016. In one combined decision, with one minor exception, the Divisional Court dismissed the three appeals.

Dr. Reid wishes to appeal the Divisional Court’s order dismissing his appeals, but missed the deadline for filing his notice of motion seeking leave to appeal. He therefore brings this motion for an extension of time to seek leave to appeal. The College opposes the motion on the basis that an extension would not be in the interests of justice.

 Issue: Should an extension of time to file the notice of motion for leave to appeal be granted?

Holding: Motion dismissed.

Reasoning:

The Test for Extending Time

The motion for an extension of time to seek leave to appeal was dismissed. The governing principle is whether the “justice of the case” requires that an extension be given (Rizzi v.

Mavros, 2007 ONCA 350, 85 O.R. (3d) 401; Enbridge Gas Distribution Inc. v. Froese, 2013 ONCA 131, 114 O.R. (3d) 636). Each case depends on its own circumstances. The relevant considerations include

a) whether the moving party formed a bona fide intention to seek leave to appeal within the relevant time period;

b) the length of, and explanation for, the delay in filing;

c) any prejudice to the responding party, caused, perpetuated or exacerbated by the delay; and

d) the merits of the proposed appeal.

This court has held that lack of merit alone can be a sufficient basis on which to deny an extension of time, particularly in cases such as this where the moving party seeks an extension of time to file a notice of motion for leave to appeal, rather than an extension of time to file a notice of appeal.

The Principles Applied

The record does not support a finding that Dr. Reid formed the intention to appeal the Divisional Court Decision within the requisite 15 days. The Court of Appeal did find, however, that it was clear that Dr. Reid had the requisite intention to have the Divisional Court decision reviewed within a few days of the expiry of the 15 day period. Dr. Reid should have filed the notice of motion for leave to appeal on June 27, 2016 and his counsel advised the College of Dr. Reid’s intention to seek leave to appeal on July 13, 2016.

In terms of prejudice, the Court of Appeal saw nothing in the record, apart from the costs associated with permitting the litigation to continue, to suggest that the College would suffer prejudice if an extension was granted.

Before granting leave, this court must be satisfied that the proposed appeal presents an arguable question of law, or mixed law and fact, requiring consideration of matters such as the interpretation of legislation; the interpretation, clarification or propounding of a general rule or principle of law; or the interpretation of an agreement or by-law where the point in issue involves a question of public importance.

 The Proposed Appeal of the Costs Decision

Dr. Reid submits that the appeal of the Costs Decision will affect future approaches to the reasonableness of cost awards under s. 53.1 of the Health Professions Procedural Code, Schedule 2 of the Regulated Health Professions Act, 1991, S.O. 1991, c. 18 (the “Code”). He further argues that, given the dissenting opinion in the decision of the Divisional Court, the cost decision has merit. The Court of Appeal disagreed.

Section 53.1 of the Code gives the College jurisdiction to order costs. The courts have recognized this jurisdiction and have described it as being broad and discretionary. The courts have also identified the

College’s right and responsibility to protect its members from the weight of the expense of protracted disciplinary hearings. The standard of review of reasonableness applies to the Costs Decision as

the College was interpreting its own statute and was exercising discretion in making the award. A decision is only unreasonable if there is no line of analysis in the reasons that could reasonably lead the administrative tribunal from the evidence to the conclusion reached.

The majority conducted a reasonableness review when assessing the Costs Decision. On the basis of this review, the majority concluded that the Panel had considered relevant factors, including the parameters of s. 53.1 of the Code, the College’s costs, the findings of liability and the College’s relative success. In the light of the discretionary nature of the Costs Decision, the standard of review and the Divisional Court’s thorough and unimpeachable approach to the issue, the Court of Appeal concluded that the application for leave to appeal the Costs Decision is without merit.

The conclusions of the Panel and the Divisional Court that Dr. Reid had an obligation to cooperate with the College and that he breached it by failing to provide submissions to complaints, are unassailable.

Moreover, the purported appeal does not involve a special circumstance or a matter of public importance.

Dr. Reid’s argument that the Divisional Court erred in finding there was no valid issue of bias completely lacks merit. No evidence was called and Dr. Reid’s credibility was not in issue.

The Proposed Appeal of the Penalty Decision

Dr. Reid has made it clear that his application to seek leave to appeal the Penalty Decision is dependent on his appeal of the Liability Decision. Given the Court of Appeal’s conclusion that the appeal concerning the Liability Decision is without merit, it follows that his appeal concerning the Penalty Decision is also without merit.

The College has not been prejudiced by the delay, nor fairly, does it claim to be. The fact that there is no evidence that Dr. Reid formed an intention to appeal the Divisional Court Decision within the relevant time frame alone may constitute a sufficient basis upon which to dismiss Dr. Reid’s motion. However, the decision to dismiss the motion rests on the basis that, given the lack of merit of the proposed appeal, justice requires that Dr. Reid’s motion for extension of time to file his motion for leave to appeal, be dismissed.

Squires v. Crouch, 2016 ONCA 774

[Feldman, Epstein and Miller JJ.A.]

Counsel:

K. Jagersky, for the appellant/respondent by way of cross-appeal

E. Lenkinski and A. M. Carr, for the respondent/appellant by way of cross-appeal

 Keywords:  Family Law, Spousal Support, Imputed Income, Spousal Support Advisory Guidelines, Lefebvre v. Gowan

Facts:

At issue was the financial calculation of spousal support. Both parties were unrepresented at trial but had counsel on the appeal.

Issues:

  1. Did the trial judge err in imputing income to the respondent?
  2. Did the trial judge err in the quantum of spousal support awarded?
  3. Did the trial judge err in the recognition of extraordinary expenses?
  4. Did the trial judge err in respect of the appellant’s medical insurance?

Holding:

Appeal allowed (order varied, however, in favour of the respondent).

Reasoning:

  1. Though the trial judge recognized the respondent’s significant health problems and attempts to re-train for her career, he purported to accept her counsel’s submission regarding income. The trial judge erred in this respect, as there was no counsel for the wife and no such submission to that effect was made. The Court of Appeal held that the evidence supported the implicit finding of the trial judge that the respondent was not deliberately underemployed during the relevant years for calculation. Accordingly, the Court accepted the submission of the respondent that no income (other than actual earnings) be imputed for the purposes of calculating support.
  2. The trial judge in effect awarded the high range of spousal support under the Spousal Support Advisory Guidelines. The Court held that the high end of the range was appropriate, but reduced the amount to reflect correct figures, which the trial judge had not relied upon.
  3. The Court relied on Lefebvre v. Gowan, 2014 ONSC 6221 for the proposition that if grandparents help a separated child pay the expenses of the grandchildren, it does not in the ordinary course absolve the other parent from financial responsibility.
  4. The appellant had medical insurance through his employer. The Court held that the trial judge had not erred in ordering that the appellant shall continue to cover the respondent for extended health benefits through his employer, and that if such benefits were no longer covered, the respondent may move to vary support.

 

Norton McMullen Consulting Inc. v. Boreham, 2016 ONCA 778

[Hoy A.C.J.O., Benotto and Huscroft JJ.A.]

Counsel:

H. S. Fairley and N. J. Kasozi, for the appellants, Paul Boreham, 401 Energy Ltd., MFOP Wind Power Ltd.

L. C. Munro, for the respondents, Norton McMuller Consulting Inc., Paul Simpson and Rob Gilroy

K. Phung and M. Shell for the respondents, Norton McMuller Consulting Inc. and Paul Simpson

Keywords: Contracts, Summary Judgment

Facts:

The respondent Norton McCullen Consulting Inc (NMC) sued the appellant Paul Boreham and his associated companies (collectively, “Boreham”) for amounts owing under two agreements between the parties: a Consulting Agreement and a Letter of Credit Agreement. In a separate action, Boreham sued Norton McMullen & Co. LLP (“NMA”), an accounting firm of which NMC is an offshoot, for negligence and breach of fiduciary duty.

The events that gave rise to these actions concerned a business venture (the “Project”) in which Boreham sought to exploit the Ontario provincial government’s Feed-in Tariff (“FIT”) program for wind power, more specifically a “bonus” component of the FIT program called the “Community Price Adder”. The

Project involved several companies, the corporate and shareholding structures of which Boreham designed to comply with what he believed to be the requirements for access to the Community Price Adder. At the time of his corporate planning, Boreham believed that the only requirement was to have majority shareholding by local investors. Therefore, he incorporated ten “project companies”, selling 51% of the shares of each to local investors and retaining the remaining 49% of the shares, as well as the revenue from the share sales, in his controlled holding company, 401 Energy Ltd. (“401”). However, he later learned that the Community Price Adder required not only that the local investors own the majority of the shares, but also that they have 50% of the “real economic interest”. The Project did not qualify because the local investors’ real economic interest was limited to the aggregate of $4.3 million they paid for their shares and the total development cost for the Project was $200-250 million.

In 2009, while still operating under a mistaken understanding of the Project’s regulatory architecture, Boreham retained Paul Simpson, a partner at NMA, with a mandate to obtain investors for the Project. Boreham had previously retained NMA for tax accounting services. In March 2010 the Consulting

Agreement in issue was signed. It provided that Simpson, through NMC would seek to find potential investors. A scale of fees was included that depended upon the selling price secured. Boreham then required $500,000 to post as performance security for his FIT contract with the provincial government. Simpson agreed to post a letter of credit personally and the Letter of Credit Agreement at issue was signed.

Eventually, with Boreham’s involvement, Simpson and Boreham’s lawyer negotiated a sale of the equity in the Project. NMC and Simpson sued Boreham for amounts owing on the Letter of Credit and the Consulting Agreement and moved for summary judgment. Boreham argued that the agreements were unenforceable.

The appellants were involved in two separate actions. They were plaintiffs in one and defendants in the other. They sought to consolidate the two actions. However, the respondents successfully moved for summary judgment against the appellants in the action they were defending. The motions judge then declined to consolidate the actions since there was only one action left. The appellants seek to have the two actions remitted to trial and consolidated.

Issues:

  1. Did the motion judge err by determining that the case was appropriate for summary judgment?
  2. Did the motion judge err by not determining that the Consulting Agreement and the Letter of Credit Agreement are unenforceable because they are in substance loan agreements and impose interest contrary to s. 347 of the Criminal Code and were procured in violation of the fiduciary duty that Simpson owed to Boreham and other equitable principles?
  3. Did the motion judge err by determining that Boreham was personally liable to NMC?

Holding:

Appeal dismissed.

Reasoning:

  1. No. The Court of Appeal agreed with the motions judge when he described the action as “a document-driven case.” The parties communicated with each other by email; they documented all of their agreements through lawyers; and there were no real credibility issues. The transactions between the parties involved “the enforcement of carefully negotiated, thoroughly lawyered, and unambiguously drafted contracts”. This was precisely the type of case that should be determined by way of summary judgment. There was no basis to interfere with these findings.
  1. No. The appellants did not plead or argue below that the Consulting Agreement was in substance a loan agreement and that the effect of the success fee that it provided for was to impose interest contrary to s. 347 of the Criminal Code. This is a sufficient basis to reject this argument on appeal. In any event, the Consulting Agreement is an agreement for the provision of services and is not, in substance, a loan agreement. The fact that, in face of Boreham’s cash-flow problems, Simpson agreed to defer hourly fees and accept a success fee did not convert the Consulting Agreement into a loan agreement.

The appellants did not plead that Simpson acted as Boreham’s agent, and it is not clear that this was argued belowThe argument in any event fails in the face of the motion judge’s finding as to the nature of Simpson and Boreham’s working relationship. He stated that “the documentation shows Boreham to have been involved in instructing Simpson and approving or rejecting various proposals at every step.” As the motion judge concluded, there was no basis to impose a fiduciary duty on Simpson.

  1. No. Boreham was a party to both agreements in a personal capacity. There was no basis to interfere with these findings.

Ayr Farmers Mutual Insurance Company v. Wright, 2016 ONCA 789

[Simmons, Gillese and Hourigan JJ.A.]

D. Strigberger and J. L. Meth, for the appellant

J. J. Mays, for the respondent

Keywords: Insurance Law, Insurance Act, Statutory Accident Benefits, ss 279 to 283, Entitlement, Mediation, Arbitration, Statutory Interpretation, Rizzo & Rizzo Shoes Ltd. (Re), [1998] 1 S.C.R. 27, Definition of “Accident”, “Insured Person”

Facts:

Under s. 268 of the Insurance Act, R.S.O. 1990, c. I.8 (the “Act”), statutory accident benefits (“SABs”) are provided for in every automobile insurance policy in Ontario so that persons injured in automobile accidents in Ontario and Ontario residents injured in car accidents outside Ontario are entitled to receive SABs regardless of fault.

In this case, Scott Wright applied to Ayr Farmers Mutual Insurance Company for SABs, claiming that he was injured when he tried to close his garage door after backing his vehicle out of his garage.

Ayr Farmers denied Mr. Wright’s claim for SABs, saying that his injuries were not the result of an “accident” as defined in the Statutory Accident Benefits Schedule – Effective September 1, 2010, O. Reg. 34/10 (the “Schedule”), and that he was therefore not entitled to SABs.

Sections 279 to 283 of the Act set out a mandatory scheme for resolving disputes “in respect of any insured person’s entitlement to statutory accident benefits” (the “s. 279 scheme”). The s. 279 scheme requires that parties submit disputes in respect of entitlement to SABs to mediation before any court proceeding can be brought: ss. 279, 281(2).

Mr. Wright applied for mediation under the s. 279 scheme to resolve his dispute with Ayr Farmers.

Rather than attend the mediation, Ayr Farmers issued an application under rule 14 of the Rules of Civil Procedure, requesting a determination of whether Mr. Wright was involved in an accident within the meaning of the Schedule.

On its application, Ayr Farmers argued that the question whether Mr. Wright was involved in an accident is a preliminary issue that must be determined before the s. 279 scheme applies.

The application judge rejected Ayr Farmers’ argument, holding that the s. 279 scheme governs all disputes concerning entitlement to SABs, including whether a claimant was involved in an accident and qualifies as an insured person under the Schedule.

The application judge also found that this was not an appropriate case for an application. In his view, determining whether Mr. Wright was involved in an accident would require examining all the surrounding circumstances. The only material before the court was “a brief line” from Mr. Wright’s application for SABs. In other cases where similar issues had been determined on an application, either there were no material facts in dispute or there was an agreed statement of facts. That was not the case here, and the question whether Mr. Wright was involved in an accident should not be determined on this application.

Issues:

  1. Is the question whether Mr. Wright was involved in an accident a preliminary issue that falls outside the s. 279 scheme?
  2. If the answer to 1) is yes, can the issue be determined by application?

Holding: Appeal Dismissed.

Reasoning:

No. Sections 279 to 283 of the Act set out a mandatory scheme for resolving disputes “in respect of any insured person’s entitlement to statutory accident benefits”. Following a failed mediation, it is the insured who decides the forum in which to proceed: Liberty Mutual Insurance Company v. Fernandes (2006). Under ss. 281(1)(a) and (b), the insured person can choose to either “bring a proceeding in a court of competent jurisdiction” or “refer the issues in dispute to an arbitrator under section 282”. In contrast, an insurer is limited to requesting the insured’s consent to submit the issue to arbitration, in accordance with the Arbitration Act: s. 281(1)(c) of the Insurance Act.

It is well established that the definition of insured person in the Schedule governs the entitlement to SABs: Warwick v. Gore Mutual Insurance Co. (1997), 32 O.R. (3d) 76 (C.A.). Under this definition, Mr. Wright will qualify as an “insured person” only if he was involved in an “accident”.

The modern approach to statutory interpretation requires that the words of a statute be read “in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament”: see Rizzo & Rizzo Shoes Ltd. (Re), [1998] 1 S.C.R. 27, at para. 21,

The rules governing statutory interpretation apply equally to regulations. Importantly, a regulation must be read in the context of the enabling Act, having regard to the purpose of the enabling provisions: Bristol-Myers Squibb Co. v. Canada (Attorney General), 2005 SCC 26. The modern approach to statutory interpretation involves a textual, contextual and purposive analysis of the statute or provision in question.

Ayr Farmers submits that the question whether Mr. Wright was involved in an accident – and therefore whether he qualifies as an insured person under the s. 279 scheme – is not a SABs issue but rather a coverage issue. According to Ayr Farmers, before the s. 279 scheme is triggered, the coverage issue must first be determined.

Ayr Farmers’ arguments were not accepted by the court. By adopting a purposive approach to interpreting the s. 279 scheme, the application judge was correct in holding that it governs all disputes concerning entitlement to SABs, including whether a claimant was involved in an accident.

First, the s. 279 scheme establishes a comprehensive alternative process to the courts that includes a separate administrative body for resolving disputes between SABs claimants and insurers concerning entitlement to and the amount of benefits. The s. 279 scheme limits access to the courts and incentivizes claimants to pursue arbitration rather than litigation. In my view, interpreting the s. 279 scheme in a manner that would require either the SABs claimant or an insurer to apply to court for a preliminary determination of whether a claimant qualifies as an insured person is inconsistent with the creation of a comprehensive alternative dispute resolution process.

Second, while court proceedings might provide a more expeditious process where it is determined a SABs claimant does not qualify as an insured person, a court proceeding would be duplicative and counter-productive where a SABs claimant does qualify as an insured person.

Third, having regard to the purposes of the Act and the s. 279 scheme, “insured person” as it appears in the s. 279 scheme can reasonably be read as encompassing all persons claiming entitlement to benefits under the Schedule whether or not it is ultimately determined that they are entitled to benefits.2. The court did not comment on the second issue because the first was answered in the negative.

Civil Endorsements:

El Kasir v Susac, 2016 ONCA 797

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

Counsel:

F. E. Kasir, acting in person

S. Susac, acting in person

Keywords: Endorsement, Jurisdiction, Small Claims Court, Damages

 Baskaran v. Doshi, 2016 ONCA 796

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

Counsel:

R. Robinson and C. Selby, for the appellants

S. Dewart and C. Donovan, for the respondents

Keywords: Endorsement, Torst, Negligence, Solicitors, Duty to Warn, Mortgages

 Lougheed v. Lougheed, 2016 ONCA 781

[Gillese, Pepall and Roberts JJ.A.]

Counsel:

J.B.R. Palmer, for the appellant William Lougheed

C. L. Dilts for the respondents

Keywords: Endorsement, No Reasonable Cause of Action, Vexatious Litigants

Lin v. Vancouver Head Office, 2016 ONCA 788

[Simmons, LaForme and Pardu JJ.A.]

Counsel:

K. Lin, in person

S. Phillips, for the respondent the Attorney General of Canada

Keywords: Endorsement, Leave to Appeal, Rule 2.1 Rules of Civil Procedure

Lin v. Springboard, 2016 ONCA 787

[Simmons, LaForme and Pardu JJ.A.]

Counsel:

K. Lin, in person

S. D. Todd, for the respondent

Keywords: Endorsement, Leave to Appeal, Judicial Review Application, rule 2.1 Rules of Civil Procedure

Williams v. Grand River Hospital, 2016 ONCA 793

[Strathy C.J.O., LaForme and van Rensburg JJ.A.]

Counsel:

A. Rouben and G. Carr, for the appellant Dr. Peter Schuringa

E. S. Lederman and M. Robins, for the respondents

Keywords: Endorsement, Motion to Quash Appeal, Mistrial, Jurisdiction

Criminal Decisions

R. v. Pelletier, 2016 ONCA 776

[Simmons, Pardu and Miller JJ.A.]

Counsel:

T. R. Botten, for the appellant

S. Porter, for the respondent

Keywords: Endorsement, Criminal Law, Crown Witnesses, Reasonable Doubt

R. v. Cook, 2016 ONCA 794

[Watt, Lauwers and Benotto JJ.A.]

Counsel:

B. Bytensky, for the appellant

C. Harper, for the respondent

Keywords: Endorsement, Criminal Law, Impaired Operation of a Motor Vehicle Causing Death, Driving while Disqualified

R. v. Grayston, 2016 ONCA 784

[MacPherson, Epstein and Lauwers JJ.A.]

Counsel:

F. J. Grayston, acting in person

J. Speyer, for the respondent

Keywords: Endorsement, Criminal Law, Theft under $5,000, Possession of Property Obtained by Crime

R. v. Ransdell, 2016, ONCA 803

[Laskin, Sharpe and Huscroft JJ.A.]

Counsel:

D. Condo, for the appellant

M. Campbell, for the respondent

Keywords: Endorsement, Criminal Law, Stay of Proceedings, Dangerous Offenders

R. v. Tung, 2016, ONCA 782

[Feldman, Simmons and Pepall JJ.A.]

Counsel:

A. Tung, in person

E. Dann, amicus curiae

B. Jones, for the respondent

Keywords: Criminal Law, Summary Conviction, Leave to Appeal, Jurisdiction

R. v. Le, 2016 ONCA 798

[Laskin J.A.]

Counsel:

B. H. Greenspan and P. Hamm, for the applicant

B. Wassenaar, for the respondent

Keywords: Criminal Law, Assignment of Counsel, Financial Eligibility

R. v. Virgo, 2016 ONCA 792

[Watt, Lauwers and Miller, JJ.A.]

Counsel:

M. C. Halfyard and B. Vandebeek for the appellant

C. Chorney for the respondent

Keywords: Criminal Law, Aggravated Assault, Evidence, Eyewitness Identification, Jury Caution

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

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Photo of John Polyzogopoulos John Polyzogopoulos

John has been the editor of Blaneys Appeals since the inception of the blog in the Summer of 2014. He is a partner at the firm with over two decades of experience handling a wide variety of litigation matters. John assists clients with…

John has been the editor of Blaneys Appeals since the inception of the blog in the Summer of 2014. He is a partner at the firm with over two decades of experience handling a wide variety of litigation matters. John assists clients with matters ranging from appeals, to injunctions, to corporate, partnership, breach of contract, construction, environmental contamination, product liability, debtor-creditor, insolvency and other business litigation. He also handles complex estates and matrimonial litigation involving disputes over property and businesses, as well as professional discipline and professional negligence matters for various types of professionals. In addition, John represents amateur sports organizations in contentious matters, and also advises them in matters of internal governance. John can be reached at 416-593-2953 or jpolyzogopoulos@blaney.com.