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Good evening.

There were five substantive civil decisions released by the Court of Appeal this week. There were many criminal decisions released.

In Wall v. Shaw, the Court determined that there is no limitation period to objecting to accounts in an application to pass accounts in an estates matter. A notice of objection is not a “proceeding” within the meaning of the Limitations Act, 2002.

In Thunder Bay (City) v. Canadian National Railway Company, the Court denied CN Rail a stay of its ruling handed down earlier this year pending leave to appeal to the Supreme Court of Canada. The Court held that the potential harm to CN was quantified at four to six million dollars if a stay was not granted and CN Rail’s appeal was ultimately successful. However, balanced against that was the fact that CN contributed to the possibility of irreparable harm by failing to move more expeditiously for leave and that the potential for serious impacts on Thunder Bay and the First Nation increased the longer the reopening of the Bridge was delayed. Ultimately, however, the Court felt that the proposed appeal did not have sufficient merit to warrant the granting of a stay.

Other topics included the distinction between final and interlocutory orders, hearsay evidence and equitable set-off in the context of summary judgment for fraud, statutory interpretation of the Health Care Consent Act, and a proper pleading of claims for misfeasance in public office and malicious prosecution.

In our Top Appeals of 2017 CLE held at the OBA this past February, one of the decisions we featured was Moore v Sweet. Our summary of the decision can be found here. At the time of our CLE in February, the appeal to the Supreme Court had just been argued. Today, the Supreme Court allowed the appeal, finding in favour of Ms. Moore. This is an important decision on the law of unjust enrichment and constructive trust. Congratulations to counsel for both sides, who had participated in our CLE panel, David Smith and Jeremy Opolsky, for a job well done. Stay tuned for details on this year’s Top Appeals CLE, which will be taking place as a dinner program on the evening of Monday, February 25, 2019.

Wishing everyone a nice weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email


Table of Contents

Civil Decisions

Thunder Bay (City) v. Canadian National Railway Company, 2018 ONCA 919

Keywords: Civil Procedure, Appeals, Stay Pending Appeal, Supreme Court Act, RSC 1985, c S-26 s 40(1), RJR-MacDonald Inc v Canada (Attorney General), [1994] 1 SCR 311, Yaiguaje v. Chevron Corporation, 2014 ONCA 40

OLA Staffing Inc v D’Angelo Brands, 2018 ONCA 922

Keywords: Contracts, Liquidated Debts, Defences, Legal Set-Off, Equitable Set-Off, Civil Procedure, Summary Judgment, Evidence, Hearsay, Rules of Civil Procedure, RRO 1990, Reg 194, r 39.01(2), Algoma Steel Inc v Union Gas Limited (2003), 63 OR (3d) 78 (CA)

Cheung v Samra, 2018 ONCA 923

Keywords: Civil Procedure, Appeals, Jurisdiction, Final Order, Interlocutory Order, Jury Trials, Mistrials, Rules of Civil Procedure, R 52.08, Courts of Justice Act, R.S.O. 1990, c. C.43, ss. 6(1)(b) and 19(1)(b), Cheung v. Samra, 2018 ONSC 3480, Hendrickson v Kallio, [1932] O.R. 675 (CA), Ball v Donais (1993), 13 OR (3d) 322 (CA), Williams et al. v Grand River Hospital et al., 2016 ONCA 793, Waldman v Thomson Reuters Canada Ltd., 2015 ONCA 53, 330 OAC 142

Wall v. Shaw, 2018 ONCA 929

Keywords: Estates, Passing Accounts, Notice of Objection to Accounts, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, ss. 4 & 5(2), Administration of Estates Act, R.S.A. 2000, c. A-2, Estates Act, R.S.O. 1990, c. E. 21, ss. 10(1), 49(2-4), 50, Courts of Justice Act, R.S.O. 1990, c. C.43, ss. 13(2) and 18(2), Alberta Limitations Act, RSA 2000, c. L-12, s. 3(1), Rules of Civil Procedure, rr. 1.03, 74.17, 74.18(1), 74.18(2), 74.18(7), 74.18(8.5) and (9), 74.18(11.5) through (13.2), 74.18(14), Substitute Decisions Act, 1992, S.O. 1992, c. 30, Armitage v. The Salvation Army, 2016 ONCA 971, Saraceni v. Saraceni, 2013 ABCA 354, Giglio v. Peters, 2009 ONCA 681, Re Knoch (1982), 12 E.T.R. 162 (Ont. Surr. Ct.), Re Pilo Estate, [1998] O.J. No. 4521 (Ont. Ct. J. (Gen. Div.)), Brown v. Rigsby, 2016 ONCA 521, Re Vano (2009), 54 E.T.R. (3d) 280 (Ont. S.C.), Maurice v. Alles, 2016 ONCA 287

Robson v The Law Society of Upper Canada, 2018 ONCA 944

Keywords: Civil Procedure, Rules of Civil Procedure, r. 25.06(8), Miazga v Kvello Estate, 2009 SCC 51, Conway v Law Society of Upper Canada, 2016 ONCA 72, Misfeasance in Public Office, Malicious Prosecution

Short Civil Decisions

Beahon v Steinfeld, 2018 ONCA 921

Keywords: Tenancy, Residential Tenancies Act, 2006, SO 2006, c 17

Conlon (Re), 2018 ONCA 934

Keywords: Real Estate, Agreement of Purchase and Sale, Termination, Waiver, Technicore Underground Inc v Toronto (City), 2012 ONCA 597

Ryu Electric Inc v Hong, 2018 ONCA 920

Keywords: Findings of Fact, Palpable and Overriding Error

Majewsky v Veveris, 2018 ONCA 938

Keywords: Costs, Offer to Settle, Prescriptive Easement, Adverse Possession

The Walt Disney Company v American International Reinsurance Company, Ltd, 2018 ONCA 948

Keywords: Insurance, Arbitration, Contractual Interpretation, Incorporation by Reference

Barker v. Patel, 2018 ONCA 926

Keywords: Mental Health, Mental Illness, Primary Treatment, Ancillary Treatment, Health Care Consent Act, 1996, SO 1996, c 2, s 23, Consent and Capacity Board, Starson v Swayze, 2003 SCC 32 [2003] 1 SCR 722, Standard of Reasonableness, Rizzo & Rizzo Shoes Ltd (Re)¸ [1998] 1 SCR 27, Mladenovic v Papatheodorou, 2015 ONSC 754

Criminal Decisions

R v Beaton (Publication Ban), 2018 ONCA 924

Keywords: Criminal Law, Sexual Offences, Appeals, Mootness, R v Smith, 2004 SCC 14, Borowski v Canada (Attorney General), [1989] 1 SCR 342

R v Kiefer, 2018 ONCA 925

Keywords: Criminal Law, Accessing and Possessing Child Pornography, Defences, Legitimate Purpose, Reasonable Doubt, R v Katigbak, 2011 SCC 48

R v Onasanya, 2018 ONCA 932

Keywords:Criminal Law, Fraud over $5,000, Possession of Property Obtained by Crime Exceeding $5,000, Identity Theft, Mens Rea, Wilful Blindness, R. v. Briscoe, 2010 SCC 13, R. v. Burnett, 2018 ONCA 790

R v Bacci, 2018 ONCA 928

Keywords:Criminal Law, Impaired Operation Causing Bodily Harm, Driving Over 80 Causing Bodily Harm, Dangerous Driving Causing Bodily Harm, Jury Instructions, Evidence, Credibility, R v W.(D.), [1991] 1 SCR 742

R v Herta, 2018 ONCA 927

[Pepall, Lauwers and Fairburn JJ.A.]

Keywords: Criminal Law, Pre-Trial Motions, Evidence, Search Warrants, Admissibility, Reasonable Expectation of Privacy, Confidential Informants, Credibility, Corroboration, Charter of Rights and Freedoms, ss. 8 and 24(2), R v Debot, [1989] 2 SCR 1140

R v Wagar, 2018 ONCA 931

Keywords: Criminal Law, Fraud Over $5,000, Sentencing, Restitution, Mitigation, R v Nasogaluak, 2010 SCC 6

R v Berhe, 2018 ONCA 930

Keywords:Criminal Law, Leave to Appeal, Summary Conviction, Sentencing, Victim Fine Surcharge, Fines,  R v Tinker, 2017 ONCA 552

R v Bjornaa, 2018 ONCA 939

Keywords:Criminal Law, Assault, Directed Verdicts, Acquittal, Credibility

R v Freeman, 2018 ONCA 943

Keywords:Criminal Law, Second-Degree Murder, Self-Defence, Provocation, Jury Instructions, R. v. Cinous, 2002 SCC 29, R v Pappas, 2013 SCC 56

R v Mohamed, 2018 ONCA 941

Keywords:Criminal Law, Firearms Offences, Evidence, Identification

R v Bruce, 2018 ONCA 933

Keywords:Criminal Law, Sentencing, Credit for Pretrial Custody

R v Pletnev, 2018 ONCA 935

Keywords: Criminal Law, Appeal Book Endorsement

R v Davis, 2018 ONCA 946

Keywords:Criminal Law, Trafficking, Possession for the Purpose of Trafficking, Jurisdiction, Certiorari, Procedendo, R v Awashish, 2018 SCC 45

R v J.D., 2018 ONCA 947

Keywords:Criminal Law, Sexual Assault, Sentencing, Cruel and Unusual Punishment, Charter of Rights and Freedoms, s. 11, R v K.R.J., [2016] 1 SCR 906

Ontario Review Board Appeals

Osawe (Re), 2018 ONCA 940

Keywords: Ontario Review Board, Detention Order, Conditional Discharge, Expert Evidence, Mental Illness

Flowers (Re), 2018 ONCA 936

Keywords: Ontario Review Board, Mental Illness, Restriction of Liberties Hearing, Disposition Order


CIVIL DECISIONS

Thunder Bay (City) v Canadian National Railway Company, 2018  ONCA 919

Counsel:

G.J. Pratte and D.A.W. Ault, for the moving party, Canadian National Railway Company

C.J. Matthews and S. Sood, for the responding party, The Corporation of the City of Thunder Bay

S.W. Crowe, for the responding party, Fort William First Nation

Keywords: Civil Procedure, Appeals, Stay Pending Appeal, Supreme Court Act, RSC 1985, c S-26 s 40(1), RJR-MacDonald Inc v Canada (Attorney General), [1994] 1 SCR 311, Yaiguaje v Chevron Corporation, 2014 ONCA 40

FActs:

The appellant moved for a stay of the Court of Appeal’s order made in June 2018, which required the appellant to reopen the James Street Bridge in Thunder Bay (the “Bridge”) for vehicle traffic and maintain the Bridge in accordance with a 1906 agreement. The appellant owns the Bridge, which traverses the Kaministiquia River. Under s. 3 of the 1906 agreement, the appellant’s predecessor gave the City respondent’s predecessor “the perpetual right to cross the Bridge for street railway, vehicle and foot traffic”. Under s. 5, the appellant’s predecessor agreed to “maintain the bridge in perpetuity”. Following a fire in 2013, the appellant closed the Bridge to vehicle traffic, claiming it was unsafe and could only be made safe through structural repairs that were beyond the scope of its maintenance obligation under the 1906 agreement.

In 2017, the application judge dismissed the City respondent’s application for a declaration that the appellant is obliged to maintain the Bridge in perpetuity and required to reopen the Bridge for vehicle traffic. He concluded that it was the intention of the parties to the 1906 agreement that the Bridge be maintained for the type of bridge traffic that existed when the agreement was made, namely streetcar and horse and cart traffic. Further, he found that the appellant had consistently taken the position that it was not obliged to make structural changes to the Bridge that would permit modern motor vehicle traffic.

On June 11, 2018, the Court of Appeal set aside the application judge’s order. Among other things, the Court of Appeal found that the application judge’s conclusion concerning the parties’ intentions was unreasonable and tainted by extricable errors of law. The appellant filed a notice of application for leave to appeal the Court of Appeal’s order to the Supreme Court of Canada on August 20, 2018. In its leave application, the appellant submitted that the Court of Appeal’s decision raised two issues of public importance that warranted granting leave to appeal:

  1. Whether an appellate court can impose a perpetual maintenance obligation that it refuses to define without affording basic procedural fairness.
  2. Whether a minimal level of specificity is required for a mandatory order.
ISSUES:

(1) Should the Court of Appeal’s order made in June 2018, which required the appellant to reopen the Bridge for vehicle traffic and maintain the Bridge in accordance with the 1906 agreement, be stayed pending leave to appeal to the Supreme Court of Canada?

Holding:

Motion dismissed.

Reasoning:

(1) No. The basic test for granting a stay pending leave to appeal is the same as the test for granting an interlocutory injunction. The moving party must demonstrate: i) a serious issue to be adjudicated on appeal; ii) that it will suffer irreparable harm if a stay is not granted; and iii) that the balance of convenience favours granting a stay: RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311, at p. 314. Overall, the court must decide whether, taking all relevant considerations into account, the interests of justice warrant granting a stay. Although, ordinarily, the threshold for establishing a serious issue to be adjudicated is low, the criteria for granting leave to the Supreme Court of Canada adds another layer to the test. Under s. 40(1) of the Supreme Court Act, R.S.C. 1985, c. S-26, leave may be granted where any question involved is one that ought to be decided by the Supreme Court by reason of its public importance or the importance of any issue of law or any issue of mixed fact and law or for any other reason of such a nature and significance as to warrant a decision by the Supreme Court. The stay test requires that a judge hearing a stay motion consider not only whether the proposed appeal raises a serious issue to be adjudicated under RJR-Macdonald. The judge must also consider the factors in s. 40(1) and assess whether there is some merit in the leave application.

(i) Serious issue to be adjudicated and s. 40(1) criteria

The motion concluded that it was unlikely that the appellant would succeed in its application for leave to appeal to the Supreme Court of Canada. As noted above, the appellant submitted that the Court of Appeal’s decision gave rise to two issues of public importance that warrant granting leave:

  1. Whether an appellate court can impose a perpetual maintenance obligation that it refuses to define without affording basic procedural fairness.
  2. Whether a minimal level of specificity is required for a mandatory order.

Concerning the first issue, the appellant submitted that the imposition of a maintenance obligation unbounded in scope and duration is a departure from established jurisprudence. It contended that the Court of Appeal’s decision created uncertainty in contracts and statutory provisions under which parties are obliged to provide (or enjoy the benefit of) maintenance. Further, the appellant submitted that the Court of Appeal imposed this maintenance obligation by erroneously finding that its scope was irrelevant to the proceeding because of a stay imposed in relation to the appellant’s original action against the City respondent.

As a starting point, the motion judge saw little merit in the appellant’s submissions about the scope of maintenance obligations and the impact of the Court of Appeal’s decision on other contracts or statutory provisions imposing maintenance obligations. It was the 1906 agreement, not the Court of Appeal, that created a perpetual right to cross the Bridge and that imposed a maintenance obligation in perpetuity. Moreover, the motion judge failed to see how the Court of Appeal’s interpretation of the specific provisions of the 1906 agreement, a rather unique contract, was likely to have an impact on the interpretation of other contracts or statutes.

Similarly, the motion judge saw little merit in the appellant’s arguments that the Court of Appeal erred in finding that the distinction the appellant drew between its maintenance obligations and making structural changes to the Bridge was irrelevant in the context of the proceeding. In its factum filed on the appeal to the Court of Appeal, the City respondent took the position that the appellant’s stance was akin to a party seeking to rely on the doctrine of frustration to excuse its breach of contract. That is the precise basis on which the Court of Appeal concluded that the distinction the appellant sought to draw between maintenance and structural changes was irrelevant in the proceeding.

In any event, the motion judge held that this was not the type of case in which the Supreme Court of Canada is likely to grant leave to appeal. This case involved the interpretation of a private contract in which established legal principles were applied. It was therefore not the type of case in which the Supreme Court typically grants leave to appeal.

Concerning the second issue, the appellant asserted that the Court of Appeal erred by ordering the appellant to reopen and maintain the Bridge without giving any direction as to when the Bridge was to be reopened, how the Bridge was to be maintained or what the duty to maintain consisted of. The appellant submitted that this was inconsistent with existing jurisprudence on both maintenance obligations and mandatory orders. The motion judge held that the flaw in this argument was that the Court of Appeal’s order did no more than order the appellant to continue performing a contract that it had been performing, without apparent difficulty, for more than 100 years.

(ii) Irreparable harm

The motion judge was satisfied that the appellant would suffer irreparable harm in the following circumstances: i) a stay was not granted; ii) the Supreme Court does not deliver its decision on the leave motion before the date on which the appellant is in a position to undertake the tendering process in relation to proposed reconstruction work; and iii) the appellant is ultimately successful in its appeal. Since the Court of Appeal’s decision was delivered, the appellant sought proposals from three engineering firms and entered into an agreement with one of those firms. After December 15, 2018, presumably, the appellant would have to arrange for tender documents to be prepared and thereafter undertake the tendering process. The appellant submitted that the latter step could lead to irreparable harm because the appellant would become contractually committed to paying for the reconstruction work for which it invited bids. The appellant had an estimate for this cost at between four and six million dollars.

The motion judge accepted the appellant’s submission that if its leave application and appeal were ultimately successful, it was doubtful that the appellant would have any recourse against the City respondent for this amount. The City respondent responded that it would be open to the appellant to make its tender and any contract conditional on denial of the request for leave to appeal. However, the City respondent provided no support for its submission that such a conditional tender would be practically feasible. The motion judge found that as a matter of common sense, bidders are unlikely to expend the time and money to submit a serious bid where a condition means the project may never proceed.

(iii) The balance of convenience

The motion judge was satisfied that the appellant may suffer irreparable harm in the form of incurring financial commitments for which it would not be compensated if a stay was not granted and the appellant ultimately succeeded on its appeal. On the other hand, both respondents filed evidence that the 10-kilometre detour that vehicular traffic must make because of the Bridge closure causes more than an inconvenience. While the motion judge had no doubt that the Bridge closure had a negative impact beyond inconvenience during the more than five years it was closed, the motion judge found the evidence of specific financial impacts unreliable. The motion judge further observed that the City respondent waited almost a year and five months before bringing its application to obtain a remedy for the Bridge closure. Nevertheless, the motion judge added the observation that had the appellant filed its leave application more expeditiously, the requirement for a stay may not have arisen. To that extent, the motion judge held that the appellant contributed to the situation it was in.

The motion judge concluded that the balance of convenience favoured the appellant, but only modestly. The potential harm to the appellant was quantified at four to six million dollars if leave was granted and its appeal was ultimately successful. Balanced against that are the facts that the appellant contributed to the possibility of irreparable harm by failing to move more expeditiously for leave and that the potential for serious impacts on the respondents increased the longer the reopening of the Bridge was delayed.

The second and third factors favoured the appellant. Nonetheless, the motion judge was not satisfied that the appellant’s leave application had sufficient merit to warrant granting a stay. The appellant did not identify a serious issue to be adjudicated that met the criteria for granting leave under s. 40 of the Supreme Court Act. Accordingly, the appellant’s motion for a stay pending leave to appeal was dismissed.

OLA Staffing Inc v D’Angelo Brands, 2018 ONCA 922

[Watt, Miller and Nordheimer JJ.A.]

Counsel:

G. Hemsworth, for the appellant

K. Bird and E. O’Dwyer, for the respondent

Keywords: Contracts, Liquidated Debts, Defences, Legal Set-Off, Equitable Set-Off, Civil Procedure, Summary Judgment, Evidence, Hearsay, Rules of Civil Procedure, RRO 1990, Reg 194, r 39.01(2), Algoma Steel Inc v Union Gas Limited (2003), 63 OR (3d) 78 (CA)

Facts:

The appellant contracted with the respondent for the provision of temporary employees to staff its manufacturing plant.  A fraudulent scheme developed whereby the appellant’s representative would request three specific employees to work at the appellant’s plant.  The representative would certify that the employees had worked and the employees would receive the payments, even though they had not worked.

The appellant discovered the fraudulent scheme and advised the police.  The appellant continued using the services of the respondent.  Eventually, the appellant refused to pay certain invoices due to the respondent on the basis that it wished to recoup the monies paid to the respondent for the employees involved in the fraudulent scheme who had not actually worked.  The respondent commenced an action to recover payment for the unpaid invoices.

The appellant defended on the basis that it was entitled to a set-off for the earlier monies paid to the respondent for the employees who had not worked together with the costs of investigating the fraud.  The motion judge granted summary judgment for the respondent, holding that: (1) most of the appellant’s evidence was inadmissible hearsay; (2) the amount claimed by way of set-off was a claim for unliquidated damages and thus was not a debt; and (3) equitable set-off was not available because the transactions were not sufficiently closely linked for the doctrine to apply.

Issue:

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

Holding:

Appeal dismissed.

Reasoning:

(1) No, the motion judge did not err in granting summary judgment.  First, most of the appellant’s evidence was inadmissible hearsay.  Since the deponent did not attest to his belief in the information provided, the appellant’s reliance on r 39.01(2) was misplaced.  Second, the appellant could not rely on the defence of legal set-off because unliquidated damages do not constitute a debt.

Third, while the motion judge’s reasoning with respect to equitable set-off was incorrect, the conclusion that it did not apply was correct.  The transactions were closely linked.  They were part of the same contractual relationship which had been ongoing for many years and was governed by a master contract.

The first requirement for the application of equitable set-off precluded its application in this case, that is, the party relying on a set-off “must show some equitable ground for being protected against the adversary’s demands.”  It was the appellant’s representative who orchestrated the fraud.  It is the appellant who should bear any loss that resulted.  The appellant was also in the best position to discover and prevent the fraud since it knew, or ought to have known, whether the employees actually worked in its plant.

Cheung v Samra, 2018 ONCA 923

[Watt, Miller and Nordheimer JJ.A.]

Counsel:

D. Cruz and M. Bridges, for the moving parties/respondents

G.MacKenzie, H. Elmaleh and B. MacKenzie, for the responding parties/appellants

Keywords: Civil Procedure, Appeals, Jurisdiction, Final Order, Interlocutory Order, Jury Trials, Mistrials, Rules of Civil Procedure, R 52.08, Courts of Justice Act, RSO 1990, c C43, ss. 6(1)(b) and 19(1)(b), Cheung v Samra, 2018 ONSC 3480, Hendrickson v Kallio, [1932] OR 675 (CA), Ball v Donais (1993), 13 OR (3d) 322 (CA), Williams et al. v Grand River Hospital et al., 2016 ONCA 793, Waldman v Thomson Reuters Canada Ltd., 2015 ONCA 53, 330 OAC 142

Facts:

This motion arose out of a medical negligence action concerning the obstetrical care provided by the moving parties to the plaintiff while she was pregnant. There was a trial on the issue of causation and the jury found in favour of the responding parties, but there was an issue over answers provided by the jury to questions asked. The moving party asked that a judgment not be entered in accordance with the jury’s verdict pursuant to r. 52.08 of the Rules of Civil Procedure. The trial judge decided not to enter judgment, and concluded that a new trial was necessary because the answers of the jury on causation were fatally flawed. The moving parties contended that the order declaring a mistrial was interlocutory and therefore any appeal should be to the Divisional Court, with leave. The responding parties contended that the order was final and that the appeal should be before the Court of Appeal as of right.

Issue:

(1) Was the order interlocutory or final in nature?

Holding:

Appeal quashed.

Reasoning:

(1) The Court stated that an interlocutory order from which there is no appeal without leave is an order which does not determine the real matter in dispute between the parties. It may be final in the sense that it determines the question raised, but it is interlocutory if the merits of the case remain to be determined. However, where a substantive right of a party is determined, even if other aspects of the proceeding remain to be determined, the resulting order is a final order. Here, the order was interlocutory, because it did not decide any substantive rights, but directed a new trial where those rights would be determined. Orders directing a new trial where mistrials have been declared have consistently been held as being interlocutory.

The responding parties resisted the comparison with cases where mistrials were declared since in the case at bar a trial was completed and a verdict received. They stated they were being deprived of their right to the jury’s verdict and of their right to a review of that decision by the Court of Appeal. The Court stated that the responding parties were not deprived of their right of review; the issue was which Court was the appropriate forum for that review. Moreover, whether the order was final or interlocutory turned on the order that was granted, not the one that might have been granted. The fact that had the trial judge reached the opposite conclusion the order would have been final did not dictate whether the order actually made was final.

Wall v. Shaw, 2018 ONCA 929

[Doherty, Brown and Trotter JJ.A.]

(sitting as Divisional Court)

Counsel:

R. G. Colautti and S. Easterbrook, for the Appellant

C. Graham and A. Bala, for the Respondent

Keywords: Estates, Passing Accounts, Notice of Objection to Accounts, Limitations Act, 2002, SO 2002, c 24, Sched B, ss. 4 & 5(2), Administration of Estates Act, RSA 2000, c A-2, Estates Act, RSO 1990, c E 21, ss. 10(1), 49(2-4), 50, Courts of Justice Act, RSO 1990, c C43, ss. 13(2) and 18(2), Alberta Limitations Act, RSA 2000, c L-12, s. 3(1), Rules of Civil Procedure, rr. 1.03, 74.17, 74.18(1), 74.18(2), 74.18(7), 74.18(8.5) and (9), 74.18(11.5) through (13.2), 74.18(14), Substitute Decisions Act, 1992, SO 1992, c 30, Armitage v The Salvation Army, 2016 ONCA 971, Saraceni v Saraceni, 2013 ABCA 354, Giglio v Peters, 2009 ONCA 681, Re Knoch (1982), 12 ETR 162 (Ont Surr Ct.), Re Pilo Estate, [1998] OJ No 4521 (Ont Ct J (Gen Div)), Brown v Rigsby, 2016 ONCA 521, Re Vano (2009), 54 ETR (3d) 280 (Ont SC), Maurice v Alles, 2016 ONCA 287

Facts:

This appeal raised a narrow issue. It involved an application by an estate trustee to pass accounts, some of which pre-dated the issuance of the application by more than two years. In response to the application, a beneficiary filed a notice of objection to accounts that included objections to the accounts pre-dating the issuance of the application by more than two years.

The appellant, a lawyer, acted as estate trustee of the estate from the deceased’s date of death, until his resignation pursuant to an order. In the years following his appointment as estate trustee, the appellant did not apply to pass his accounts. However, he met annually with the respondent and in some years, with the contingent beneficiaries.

Disputes eventually arose between the appellant and the respondent about the compensation the appellant was taking as the estate trustee. In October 2014, the respondent issued a notice of application seeking an order directing the appellant to bring an application to pass his accounts for the entire period of time since the deceased’s death in 2005. The appellant consented to an order directing him to bring an application to pass his accounts. He issued a notice of application to pass accounts on March 31, 2015, for the period from August 11, 2005, until December 31, 2013.

Several beneficiaries, including the respondent, filed notices of objection to the accounts pursuant to r. 74.18(7) of the Rules of Civil Procedure. In January 2016, the appellant moved to strike out the respondent’s notice of objection in respect of his accounts for the period 2005 to 2012 on three grounds: (i) The respondent’s approval of the accounts at the annual meetings amounted to acquiescence; (ii) her claim was barred by laches; and (iii) her objections were time-barred by ss. 4 and 5 of the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B (the “Limitations Act”).

The motion judge held that he was not satisfied the doctrine of laches applied or that the annual meetings and initialing of the statements by the respondent amounted to acquiescence. In this appeal, the respondent appealed the motion judge’s Limitations Act findings.

Issue:

(1) Did the motion judge err by refusing to apply the two-year basic limitation period in s. 4 of the Limitations Act to bar the respondent’s notice of objection in respect of the accounts for the period August 11, 2005, to December 31, 2012?

Holding:

Appeal dismissed.

Reasoning:

(1) No. The Court of Appeal, sitting as the Divisional Court, began by considering the legislative provisions governing an estate trustee’s application to pass accounts. The court then considered the application of the Limitations Act to those provisions, first as a matter of statutory interpretation and then as a matter of policy.

The Legislative Framework to Pass Accounts

Section 49(2) of the Estates Act empowers a judge on a passing of accounts by an estate trustee, “to enter into and make full inquiry and accounting of and concerning the whole property that the deceased was possessed of or entitled to, and its administration and disbursement.” The Rules of Civil Procedure contain detailed rules governing the minimum informational requirements for accounts filed with the court by an estate trustee (r. 74.17) and the procedure that a passing of accounts application must follow (r. 74.18).

The estate trustee brings the application to pass accounts (r. 74.18(1)) using a prescribed notice of application, which advises that any person with a financial interest in the estate may “object to the accounts” by serving a notice of objection. A person with a contingent or vested interest in the estate may file a notice of objection to accounts (r. 74.18(7)). Where a notice of objection is filed and not withdrawn, the application proceeds as a contested passing of accounts requiring a hearing under rr. 74.18(11.5) through (13.2) and the application judge may order that the entire application or any issue proceed to trial: r. 74.18(13.1). Where no notice of objection is filed, the estate trustee “may seek judgment on the passing of accounts” without a hearing: r. 74.18(8.5).

Analysis

The applicability of the Limitations Act to a notice of objection served in response to a passing of accounts application under the Ontario Estates Act and the Rules of Civil Procedure is a novel question. The appellant contended that this question was answered by the Alberta Court of Appeal’s decision in Saraceni v. Saraceni, 2013 ABCA 354, which established that limitations statutes apply to statutes governing estate administration in the absence of an express statutory exclusion. Saraceni is distinguishable from this case, in regard to the statutes it interpreted and the circumstances in which it applied them. First, s. 38 of the Alberta Administration of Estates Act, R.S.A. 2000, c. A-2, specifically contemplated the application of the Alberta Limitations Act, RSA 2000, c. L-12, to estate proceedings. Second, the language in s. 3(1) of the Alberta Limitations Act differs markedly from that in s. 4 of the Limitations Act. Finally, Saraceni concerned a notice of objection to a grant of probate, not a passing of accounts, which was brought eight years after the estate had been administered.

Section 4 of the Limitations Act only applies to a (i) “proceeding” commenced (ii) in respect of a “claim.” A notice of objection to accounts does not commence a proceeding. Section 49 of the Estates Act and rr. 74.17 and 74.18 of the Rules of Civil Procedure create a passing of accounts procedure in which the estate trustee, not a beneficiary, is the applicant who commences the proceeding. Section 4 of the Limitations Act does not limit the ability of a person to respond to or participate in a proceeding commenced by another. That is what happens when a beneficiary files a notice of objection to accounts. She responds to a proceeding already initiated by the estate trustee.

The appellant submitted that although a beneficiary may respond to an existing proceeding by her notice of objection, that response is essentially a counterclaim and therefore commences a proceeding. The court was not persuaded by this argument. The court held that it was significant that the definitions of “proceeding”, and its constituent terms “action” and “application” in r. 1.03 of the Rules of Civil Procedure, do not include a r. 74.18(7) notice of objection. By contrast, a counterclaim falls within the definition of an “action” in r. 1.03 and, thus, within the definition of “proceeding”.

Section 4 of the Limitations Act bars the commencement of a proceeding in respect of a claim after the second anniversary of the day on which the claim was discovered. Section 1 of that Act defines “claim” to mean “a claim to remedy an injury, loss or damage that occurred as a result of an act or omission”. In Armitage v. The Salvation Army, 2016 ONCA 971 the court held that an application by an attorney for property to pass accounts under the Substitute Decisions Act, 1992, S.O. 1992, c. 30 was not a “claim” within the meaning of the Limitations Act. Drawing on Armitage, the motion judge reasoned that if an estate trustee’s application to pass accounts is not a “claim” within the meaning of the Limitations Act, then neither is a beneficiary’s notice of objection filed in response to that application. There is force to the argument that if the estate trustee’s initial application to pass accounts is not a “claim” within the meaning of the Limitations Act, then neither is a responding objection made by the beneficiary within that proceeding.

The appellant further contended that because the notice of objection sought a reduction of compensation that he pre-took as estate trustee, which could result in an order that he pay money back to the estate, the respondent was seeking “to remedy an injury, loss or damage that occurred as a result of [his] act or omission.” He submitted that if he had not pre-taken compensation, the respondent’s notice of objection might not be a “claim” because he would not have to repay any money. The court was not persuaded by this argument. Pre-taking of compensation refers to an estate trustee taking compensation out of estate assets prior to passing his accounts. The general rule is that an estate trustee may pre-take compensation only (i) upon agreement of all persons with a vested or contingent interest (if they are sui juris), (ii) where approved by the court, or (iii) where the will so provides. Although the practice of pre-taking compensation is common, an estate trustee that does so outside of those three circumstances risks liability for breach of trust. On a passing of accounts, the estate trustee risks court approval of a reduced amount of compensation and an order requiring repayment of the difference to the estate.

Policy Considerations

A conventional civil “claim”, if successful, results in judgment in favour of the claimant. By contrast, after inquiring into a notice of objection on a contested passing of accounts, a judge “may order the executor … to pay such sum by way of damages or otherwise … to the estate,” but the form of judgment prescribed by r. 74.18(14) does not provide for any personal remedy in favour of an objecting beneficiary.

Finally, interpreting s. 4 of the Limitations Act as capturing r. 74.18(7) notices of objection to accounts would risk insulating an estate trustee’s management of an estate from effective scrutiny. No Ontario law imposes an obligation on an estate trustee to pass accounts at fixed periods of time. Armitage holds that an application to pass accounts does not fall within s. 4 of the Limitations Act. As a result, an estate trustee can apply to pass accounts that pre-date the issuance of the application by more than two years. If a beneficiary was precluded by s. 4 of the Limitations Act from objecting to those accounts, an estate trustee who wished to avoid scrutiny would have a perverse incentive to simply “wait out” the two-year limitation period knowing that the beneficiary’s objections would be statute-barred. The longer the estate trustee waited to pass accounts, the greater the period of his management of the estate he could remove from a contested hearing. Such an uneven application of the Limitations Act would place many beneficiaries in the difficult position of having to rebut the presumption in s. 5(2) of the Limitations Act that they first knew of their “claim” against the estate trustee on the day the act or omission of the estate trustee – a questioned disbursement or taking of compensation – took place. To avoid such a result, beneficiaries would be forced to bring annual applications to compel estate trustees to pass accounts, unnecessarily increasing the amount of estate litigation in this province.

Accordingly, the appeal was dismissed.

Robson v The Law Society of Upper Canada, 2018 ONCA 944

[Hoy A.C.J.O., Feldman and Paciocco JJ.A.]

Counsel:

P. R., acting in person

R. Watson, for the appellant (on one issue only)

S. Dewart and I. McKellar, for the respondents

Keywords: Civil Procedure, Rules of Civil Procedure, r. 25.06(8), Miazga v Kvello Estate, 2009 SCC 51, Conway v Law Society of Upper Canada, 2016 ONCA 72, Misfeasance in Public Office, Malicious Prosecution

Facts:

In 2002, the appellant was involved in a trial that related to a bankruptcy proceeding. A key issue during the trial was whether the appellant had acquired shares in certain companies while an undischarged bankrupt. The trial judge found that the appellant had in fact acquired said shares, which then meant that ownership in the shares vested in the bankruptcy trustee.

During the course of the trial, the trial judge made several other findings, which led the Law Society to investigate the appellant’s conduct in connection with his bankruptcy proceedings. These findings and investigations ultimately culminated in a Law Society Hearing Panel holding that the appellant had engaged in conduct unbecoming. The appellant was then disbarred, but this decision was overturned in 2015.

The appellant’s claim here related to a motion judge’s decision to strike parts of the appellant’s fresh as amended claim as it related to the respondents’ proceedings against the appellant. More specifically, the motion judge did not appear to have considered the appellant’s response to the respondents’ demand for particulars, which contained sufficient further particulars in relation to three of the four individual respondents.

Issue:

(1) Did the motion judge err in striking portions of the appellant’s claim?

Holding:

Appeal allowed in part.

Reasoning:

(1) Yes. To succeed in an action for malicious prosecution, a plaintiff must prove that the prosecution was: (1) initiated by the defendant; (2) terminated in favour of the plaintiff; (3) undertaken without reasonable and probable cause; and (4) motivated by malice or a primary purpose other than that of carrying the law into effect.

Similarly, the essence of the tort of misfeasance in public office is the deliberate and dishonest wrongful abuse of the powers given to a public officer, coupled with the knowledge that the misconduct is likely to injure the plaintiff. Bad faith or dishonesty is an essential ingredient of the tort.

The appellant had sufficiently pleaded the two torts except in relation to one of the individual respondents. The alleged improper purpose was to harass and harm the appellant. The facts pled, if true, support the inference of an improper purpose. If true, they may also point to a deliberate and dishonest wrongful abuse of the powers given to a public officer. The essence of the appellant’s fresh as amended claim was as follows: the respondents knew that the trial judge’s judgment was not correct and that many of the facts relied upon by her were inaccurate; the Law Society and one of the individual respondents deliberately acted contrary to the decision of the motion judge in proceeding solely in reliance on the findings of the trial judge; the Law Society and two of the individual respondents deliberately precluded unfavourable witnesses from being interviewed, despite pleas from the witnesses for the Law Society to do so; and that the Law Society and two of the individual respondents deliberately and formally precluded the intervention of the aforementioned unfavourable witness, whom they knew had material unfavourable evidence to the Law Society’s case, into the hearing process. He further plead that the respondents engaged in this conduct to harass and harm him.


SHORT CIVIL DECISIONS

Beahon v Steinfeld, 2018 ONCA 921

[Lauwers, Hourigan and Pardu JJ.A.]

A. Beahon, in person

V. Simkic, for the name respondent

Keywords: Tenancy, Residential Tenancies Act, 2006, SO 2006, c 17

Conlon (Re), 2018 ONCA 934

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

B.Eakins, for the appellant

A.M. Habas, for the respondents

Keywords: Real Estate, Agreement of Purchase and Sale, Termination, Waiver, Technicore Underground Inc v Toronto (City), 2012 ONCA 597

Ryu Electric Inc v Hong, 2018 ONCA 920

[Watt, Miller and Nordheimer JJ.A.]

T.N. Nguyen, for the appellant

J.H. Herbert, for the respondent

Keywords: Findings of Fact, Palpable and Overriding Error

Majewsky v Veveris, 2018 ONCA 938

[Simmons, Miller and Fairburn JJ.A.]

M.J. Huberman, for the appellants

R. Breedon, for the respondent

Keywords: Costs, Offer to Settle, Prescriptive Easement, Adverse Possession

The Walt Disney Company v American International Reinsurance Company, Ltd, 2018 ONCA 948

[Strathy C.J.O., Benotto and Roberts JJ.A.]

T.M. Lowman and L.E.T. Horne, for the appellant

J.W.E. Doris and D.D. Ricci, for the respondent

Keywords: Insurance, Arbitration, Contractual Interpretation, Incorporation by Reference

Barker v. Patel, 2018 ONCA 926

[Rouleau, Paciocco and Nordheimer JJ.A.]

Counsel:

K. Bryan, appearing as amicus curiae on the appeal of CB

K. Hunt, for the respondent, Dr. KP

J. Weiss and S. Latimer, for the appellant, JM

D. Litwin and A. Paterande, for the respondent, Dr. TKB

A. Szigeti and M. McMahon, for the intervener, The Empowerment Council

Keywords: Mental Health, Mental Illness, Primary Treatment, Ancillary Treatment, Health Care Consent Act, 1996, SO 1996, c 2, s 23, Consent and Capacity Board, Starson v Swayze, 2003 SCC 32 [2003] 1 SCR 722, Standard of Reasonableness, Rizzo & Rizzo Shoes Ltd (Re)¸ [1998] 1 SCR 27, Mladenovic v Papatheodorou, 2015 ONSC 754


CRIMINAL DECISIONS

R v Beaton (Publication Ban), 2018 ONCA 924

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

H.K. Krongold, for the appellant (deceased)

H.  Freeman, for the Crown

Keywords: Criminal Law, Sexual Offences, Appeals, Mootness, R v Smith, 2004 SCC 14, Borowski v Canada (Attorney General), [1989] 1 SCR 342

R v Kiefer, 2018 ONCA 925                               

[Hoy A.C.J.O., Watt J.A. and Then J. (ad hoc)]

B. Bytensky, for the appellant

C. Bartlett-Hughes, for the respondent

Keywords: Criminal Law, Accessing and Possessing Child Pornography, Defences, Legitimate Purpose, Reasonable Doubt, R v Katigbak, 2011 SCC 48

R v Onasanya, 2018 ONCA 932

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

M. Stellato, for the Appellant

C. Weiler, for the Respondent

Keywords:Criminal Law, Fraud over $5,000, Possession of Property Obtained by Crime Exceeding $5,000, Identity Theft, Mens Rea, Wilful Blindness, R. v. Briscoe, 2010 SCC 13, R. v. Burnett, 2018 ONCA 790

R v Bacci, 2018 ONCA 928

[Hoy A.C.J.O., Watt J.A. and Then J. (ad hoc)]

G. Lafontaine and R. Golec, for the appellant

D. Bonnet, for the respondent

Keywords:Criminal Law, Impaired Operation Causing Bodily Harm, Driving Over 80 Causing Bodily Harm, Dangerous Driving Causing Bodily Harm, Jury Instructions, Evidence, Credibility, R v W.(D.), [1991] 1 SCR 742

R v Herta, 2018 ONCA 927

[Pepall, Lauwers and Fairburn JJ.A.]

P. Campbell, for the appellant

S. Egan, for the respondent

Keywords: Criminal Law, Pre-Trial Motions, Evidence, Search Warrants, Admissibility, Reasonable Expectation of Privacy, Confidential Informants, Credibility, Corroboration, Charter of Rights and Freedoms, ss. 8 and 24(2), R v Debot, [1989] 2 SCR 1140

R v Wagar, 2018 ONCA 931

[Feldman, Roberts and Fairburn JJ.A.]

C. Cole, for the appellant

L. Bolton, for the respondent

Keywords: Criminal Law, Fraud Over $5,000, Sentencing, Restitution, Mitigation, R v Nasogaluak, 2010 SCC 6

R v Berhe, 2018 ONCA 930

[Feldman, Roberts and Fairburn JJ.A.]

The appellant, acting in person

L. Strezos, duty counsel

A. Hotke, for the respondent

Keywords:Criminal Law, Leave to Appeal, Summary Conviction, Sentencing, Victim Fine Surcharge, Fines,  R v Tinker, 2017 ONCA 552

R v Bjornaa, 2018 ONCA 939

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

K. Beaudoin, for the appellant

A. Menchynski, for the respondent

Keywords:Criminal Law, Assault, Directed Verdicts, Acquittal, Credibility

R v Freeman, 2018 ONCA 943

[Sharpe, Hourigan and Trotter JJ.A.]

J. Presser and J. Marshman, for the appellant

H. Leibovich, for the respondent

Keywords:Criminal Law, Second-Degree Murder, Self-Defence, Provocation, Jury Instructions, R. v. Cinous, 2002 SCC 29, R v Pappas, 2013 SCC 56

R v Mohamed, 2018 ONCA 941

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

S. Robinson, for the appellant

E. Whitford, for the respondent

Keywords:Criminal Law, Firearms Offences, Evidence, Identification

R v Bruce, 2018 ONCA 933

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

M. Howatt, for the appellant

E. Siebenmorgen, for the respondent

Keywords:Criminal Law, Sentencing, Credit for Pretrial Custody

R v Pletnev, 2018 ONCA 935

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

The appellants, acting in person

A. Derwa, for the respondent

Keywords: Criminal Law, Appeal Book Endorsement

R v Davis, 2018 ONCA 946

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

M.A. Moon, for the appellant

J. Conroy, for the respondent

Keywords:Criminal Law, Trafficking, Possession for the Purpose of Trafficking, Jurisdiction, Certiorari, Procedendo, R v Awashish, 2018 SCC 45

R v J.D., 2018 ONCA 947

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

E. Dann, for the moving party

E. Middelkamp, for the responding party

Keywords:Criminal Law, Sexual Assault, Sentencing, Cruel and Unusual Punishment, Charter of Rights and Freedoms, s. 11, R v K.R.J., [2016] 1 SCR 906


ONTARIO REVIEW BOARD

Osawe (Re), 2018 ONCA 940

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

K. Bryan, for the appellant

E.H. Siebenmorgen, for the Attorney General of Ontario

G.S. MacKenzie, for the Centre for Addiction and Mental Health

Keywords: Ontario Review Board, Detention Order, Conditional Discharge, Expert Evidence, Mental Illness

Flowers (Re), 2018 ONCA 936

[Sharpe, Hourigan and Trotter JJ.A.]

A. Szigeti, for the appellant

N. Rivers, for the Attorney General of Ontario

G. Mackenzie, for the Centre for Addiction and Mental Health

Keywords: Ontario Review Board, Mental Illness, Restriction of Liberties Hearing, Disposition Order

 

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 almost two decades of experience handling a wide variety of litigation matters. John assists clients with matters ranging from appeals, to injunctions, to corporate, breach of contract and other business litigation, to estates and matrimonial litigation, and to debtor-creditor and insolvency litigation. John also represents amateur sports organizations in contentious matters and advises them in matters of internal governance. John can be reached at 416-593-2953 or jpolyzogopoulos@blaney.com.