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Good evening.

Here are this week’s summaries of the civil decisions of the Court of Appeal for Ontario.

In Donovan v. Sherman Estate, the Court briefly reviewed the test for granting a sealing order. The Court observed that although the desire for privacy in this case was understandable, by itself, the desire for privacy without a public interest component is insufficient to justify the granting of a sealing order.

In Ruffolo v. David, the Court addressed the contempt power, stressing that contempt is an enforcement power of last resort and should be employed sparingly in order to preserve the judicial authority it is intended to protect. The Court additionally noted that appeals from contempt findings should typically only be made after the court of first instance has levied a sanction against the contemnor. In this case, though, the Court set aside the finding of contempt even before the court below had imposed a sanction.

In Service Mold + Aerospace Inc v. Khalaf, the Court examined the different principles to be applied between summary judgment and partial summary judgment. Partial summary judgments may increase the risk of duplicative proceedings or inconsistent findings and can frustrate the Hryniak objective of using summary judgment to achieve proportionate, timely and affordable justice. The Court held that a partial summary judgment should not proceed unless the issues can be bifurcated without causing overlap that could lead to duplication or inconsistent findings.

In Curley v. Taafe, the Court reviewed the test for malicious prosecution, confirming that in certain circumstances, the complainant may be treated as the prosecutor for the purposes of alleging the tort. The Court additionally clarified the application of the rule in Browne v Dunn, and reviewed the test for judicial notice of facts.

Other topics covered this week included whether a corporation should be liquidated with or without the court’s supervision, vexatious litigants, and forum selection clauses/forum non conveniens.

Finally, I wanted to take this opportunity to thank all of the participants and panelists who attended our Top Appeals of 2018 CLE that was held yesterday evening at the OBA. Lea and I enjoyed chairing the proceedings and hope that everyone in attendance found the program as interesting as we did. Our insider panelists shared interesting insights into some of the top appeals that were decided by the court last year.

Our first panel discussed the continuing expansion of the “appropriate means” test contained in ss. 5(1)(a)(iv) of the Limitations Act, 2002. The limitation period can be delayed if there is a different procedure available to remedy the damage besides a court proceeding, a professional has undertaken to rectify the damage, and now also if the damage is so trivial that it would be appropriate to take a “wait and see” approach to determine if the damage rises to a non-trivial level.

In addition, claims over for contribution and indemnity are now subject to the same discoverability principles of all other claims, so there is no hard two-year limitation period for claims over (Mega International Commercial Bank (Canada) v. Yung, one of the other decisions we discussed yesterday). As was pointed out during the panel discussion, the determination that discoverability applies to claims for contribution and indemnity is problematic, given the wording of section 5. Section 18 deems a defendant served with a claim as having knowledge that damage has been suffered on the date the defendant is served with a statement of claim (ss. 5(1)(a)(i)). However, by virtue of ss. 5(2), that deemed fact is only a presumption, which can be rebutted. Claims over for contribution or indemnity do not typically crystallize until a defendant suffers judgment or settles (unless a contractual indemnity says otherwise, as was the case in the prior leading authority on the limitation period applicable to claims for contribution and indemnity – Canaccord Capital Corporation v. Roscoe, 2013 ONCA 378). Therefore, for most claims over, the presumption that damage has been suffered is automatically rebutted. The consequence of the Court’s decision in Mega International may therefore be that defendants may have until two years after they suffer judgment or settle to bring a claim for contribution and indemnity. This result is obviously not in accordance with the intention of section 18 of the Limitations Act, 2002. It remains to be seen whether the Court will be asked to decide this issue directly in the future.

Two of the other appeals featured last night, Pointes Protection and Platnick v. Bent, were recently granted leave by the Supreme Court. We therefore await the SCC’s pronouncements on the anti-SLAPP provisions contained in sections 137.1 to 137.5 of the Courts of Justice Act.

Finally, one of the other decisions featured (which was a decision on a stay motion pending appeal), City of Toronto v Attorney-General (reduction of wards from 47 to 25), is going to a full hearing of the appeal before a five-member panel next month, even though the election went ahead with the reduced number of wards. In January, the new City Council of 25 confirmed the prior Council’s instructions to oppose the Attorney-General’s appeal, and to even seek leave to the Supreme Court in the event that MAG is successful on its appeal. There will therefore be more to come on this case in a future blog post.

Have a nice weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email


Table of Contents

Civil Decisions

Growthworks Commercialization Fund Ltd. v. Growthworks WV Management Ltd., 2019 ONCA 371

Keywords: Corporations, Dissolution, Voluntary Liquidation, Canada Business Corporations Act, R.S.C. 1985, c. C-44, ss. 211(7), 217(a)

Peoples Trust Company v. Atas, 2019 ONCA 359

Keywords: Civil Procedure, Vexatious Litigants, Self-Represented Litigants, Case Management, Pre-Screening Chavali Orders, Functus Officio, Courts of Justice Act, R.S.O. 1990, c. C. 43, s. 140, Chavali v. Law Society of Upper Canada, [2006] O.J. No. 2036 (SC), Housen v. Nikolaisen, 2002 SCC 33, R. v. Jordan, 2016 SCC 27, Hamilton v. Open Window Bakery Ltd., 2004 SCC 9

Curley v. Taafe, 2019 ONCA 368

Keywords: Contracts, Breach of Contract, Torts, Malicious Prosecution, Evidence, The Rule in Browne v. Dunn (1893), 6 R 67 (UKHL), Pate v. Galway-Cavendish, 2011 ONCA 329, leave to appeal refused, [2011] SCCA No. 293, Nelles v. Ontario, [1989] 2 SCR 170, Correia v. Canac Kitchens (2007), 56 CCEL (3d) 209 (ONSC), Kefeli v. Centennial College of Applied Arts and Technology (2000), 23 CPC (5th) 35 (ONCA, in Chambers), Peters v. Perras (1909), 42 SCR 244, Yan v. Nadarajah, 2017 ONCA 196, R. v. Find, 2001 SCC 32

Forbes Energy Group Inc. v. Parsian Energy Rad Gas, 2019 ONCA 372

Keywords: Contracts, Breach of Contract, Forum Selection Clauses, Civil Procedure, Conflict of Laws, Jurisdiction, Forum Non Conveniens, Real and Substantial Connection, Strong Cause Test, Douez v. Facebook, Inc, 2017 SCC 33, Novatrax International Inc v. Hagele Landtechnick GmbH, 2016 ONCA 771, Club Resorts Ltd. v. Van Breda, 2012 SCC 17, Young v. Tyco International of Canada Ltd., 2008 ONCA 709, A1 Pressure Sensitive Products Inc. v. Bostik, Inc., 2009 ONCA 206

Service Mold + Aerospace Inc. v. Khalaf, 2019 ONCA 369

Keywords: Torts, Conversion, Negligence, Banking, Negotiable Instruments, Cheque Fraud, Strict Liability, Contracts, Verification Agreements, Civil Procedure, Partial Summary Judgment, Limitation Periods, Discoverability, Limitations Act, 2002, S.O. 2002, c. 24, Sched B, s. 5, Bills of Exchange Act, R.S.C. 1985, c. B-4, s. 4, Baywood Homes Partnership v. Haditaghi, 2014 ONCA 450, Hryniak v. Mauldin, 2014 SCC 7, Butera v. Chown, Cairns LLP, 2017 ONCA 783, Corchis v. KPMG Peat Marwick Thorne, [2002] OTC 475 (CA)

Donovan v. Sherman Estate, 2019 ONCA 376

Keywords: Wills and Estates, Civil Procedure, Sealing Orders, Open Court Principle, R. v. Mentuck, [2001] 3 S.C.R. 442, Atomic Energy of Canada v. Sierra Club of Canada, [2002] 2 S.C.R. 522

Ruffolo v. David, 2019 ONCA 385

Keywords: Family Law, Custody and Access, Civil Procedure, Orders, Enforcement, Contempt, Sabourin and Sun Group of Companies v. Laiken, 2011 ONCA 757, Carey v. Laiken, 2015 SCC 17

Short Civil Decisions

Ontario (Transportation) v. 2523654 Ontario Inc., 2019 ONCA 370

Keywords: Provincial and Regulatory Offences, Highways, Public Transportation and Highway Improvement Act, R.S.O. 1990, c. P.50, s. 112

Salman v. Patey, 2019 ONCA 365

Keywords: Civil Procedure, Appeals, Extension of Time, Summary Judgment

Stanley v. Patrice, 2019 ONCA 373

Keywords: Family Law, Child Support, Jurisdiction, Family law Rules, O. Reg. 114/99, Rule 1(8.1)

Criminal Decisions

Canada v. McDonald, 2019 ONCA 367

Keywords: Criminal Law, Conspiracy to Commit Human Smuggling, Manslaughter by Criminal Negligence, Right to Counsel, Jeopardy, K.G.B. Statements

R. v. Majeed, 2019 ONCA 366

Keywords: Criminal Law, Credit Fraud, Inducing a Person to Act on a False Document

R. v. Bartholomew, 2019 ONCA 377

Keywords: Criminal Law, Sexual Assault, Sexual Interference, Evidence, Credibility, Criminal Code, ss. 151, 271, R. v. L.L., 2009 ONCA 413, R. v. White (1996), 29 O.R. (3d) 577 (C.A.)

R. v. Badgerow, 2019 ONCA 374

Keywords: Criminal Law, First Degree Murder, Sexual Assault, Abuse of Process, Evidence, Hearsay, Jury Instructions, Criminal Code, ss. 229(a) and 653.1, R. v. Badgerow, 2008 ONCA 605, R. v. Badgerow, 2014 ONCA 272, R. v. Calnen, 2019 SCC 6, R. v. Victoria, 2018 ONCA 69

R. v. Said, 2019 ONCA 378

Keywords: Criminal Law, Assault With a Weapon, Assault Causing Bodily Harm, R. v. Stucky, 2009 ONCA 151, R. v. Murray, 2017 ONCA 393

R. v. C.B., 2019 ONCA 380

Keywords: Criminal Law, Assault, Sexual Assault, Unlawful Confinement, Evidence, Authenticity, Credibility, Fresh Evidence, Canada Evidence Act, R.S.C. 1985, c. C-85, ss. 31.1 and 31.8, Criminal Code, ss. 683(1) and 686(1)(a)(iii), R. v. Hirsch, 2017 SKCA 14, R. v. Nikolovski, [1996] 3 S.C.R. 1197, R. v. Morrissey (1995), 97 C.C.C. (3d) 193 (Ont. C.A.), R. v. Lohrer, 2004 SCC 80, R. v. Palmer, [1980] 1 S.C.R. 759, Truscott (Re), 2007 ONCA 575

R. v. Campbell, 2019 ONCA 382

Keywords: Criminal Law, Sentencing, Pre-Sentence Custody

R. v. Hansen, 2019 ONCA 381

Keywords: Criminal Law, Sentencing, Driving Prohibition, Criminal Code, s. 259(1) and (2)

R. v. Hartwick, 2019 ONCA 383

Keywords: Criminal Law, Appeal Abandoned

R. v. Menezes, 2019 ONCA 384

Keywords: Criminal Law, Appeal Abandoned

R. v. Chioros, 2019 ONCA 388

Keywords: Criminal Law, Possession, Possession for the Purpose of Trafficking, Evidence, Confidential Informants, Debot Factors, Search and Seizure, Reasonable and Probable Grounds, Credibility, Corroboration, Grant Factors, Canadian Charter of Rights and Freedoms, ss. 8, 9 and 24(2), R. v. Debot, [1989] 2 S.C.R. 1140, R. v. Grant, 2009 SCC 32

R. v. Mehedi, 2019 ONCA 387

Keywords: Criminal Law, Hybrid Offences, Summary Dismissal, Application for Certiorari, Vexatious Litigants, Criminal Code, s. 685, Interpretation Act, R.S.C., 1985, c. I-21, s. 34(1)(a)

R. v. Abreha, 2019 ONCA 392

Keywords: Criminal Law, Firearms Offences, Loss of Evidence, Stay of Proceedings, Jury Instructions, Canadian Charter of Rights and Freedoms, s. 7, R. v. Bero (2000), 151 C.C.C. (3d) 545 (Ont. C.A.), R. v. Hersi, 2019 ONCA 94, R. v. Stinchcombe, [1991] 3 S.C.R. 326

United States v. Ebanks, 2019 ONCA 390

Keywords: Criminal Law, Extradition, First Degree Murder, Death Penalty, Evidence, Treaty on Extradition Between the Government of Canada and the Government of the United States of America, 3 December 1971, Can. T.S. 1976 No. 3, Extradition Act, S.C. 1999, c. 18, s. 32(2), Canadian Charter of Rights and Freedoms, ss. 7 and 10(b), United States of America v. Dynar, [1997] 2 S.C.R. 467

Ontario Review Board

LePage (Re), 2019 ONCA 363

Keywords: Ontario Review Board, Criminal Law, Possession of a Weapon for a Purpose Dangerous to the Public Peace, Not Criminally Responsible, Significant Threat to Public Safety, Criminal Code, ss. 672.78(3)(a) and (c), Part XX.1, Gonzales (Re), 2017 ONCA 102, Ontario (Attorney General) v. Taylor, 2010 ONCA 35

Jakaj (Re), 2019 ONCA 379

Keywords: Ontario Review Board, Criminal Law, Detention Orders, Significant Threat to the Public, Criminal Code, Part XX.I, Mental Health Act, R.S.O. 1990, c. M.7


CIVIL DECISIONS

Growthworks Commercialization Fund Ltd. v. Growthworks WV Management Ltd., 2019 ONCA 371

[Doherty, Rouleau and Brown JJ.A.]

Counsel:

M.L. Solmon and C. Wetmore, for the appellant

G.R. Hall and E.M. MacKinnon, for the respondent

Keywords: Corporations, Dissolution, Voluntary Liquidation, Canada Business Corporations Act, R.S.C. 1985, c. C-44, ss. 211(7), 217(a)

FACTS:

The corporate appellant (the “Manager”) was the manager of the related respondent (the “Fund”), a Canada Business Corporations Act (“CBCA”) corporation. The parties agreed that the Fund should be liquidated and dissolved, but disagreed over the liquidation process. The Manager sought liquidation under the court’s supervision, while the Fund requested to use the voluntary liquidation process set out in the CBCA, s 211(7). The motion judge ordered the Fund’s liquidation using the latter process, which did not involve a court-appointed liquidator.

ISSUES:

(1) Did the application judge err by relying on the CBCA, s 217(a) to grant the Fund an order for the liquidation and dissolution of the Fund?

(2) Did the application judge err by ordering the liquidation without appointing a liquidator?

HOLDING:

Appeal dismissed.

REASONING:

(1) No. The Manager’s challenge to the application judge’s order was overly technical and without any practical consequence. There was no dispute that the Fund should be liquidated, that the Fund should be dissolved and that the motion judge had the jurisdiction to make a liquidation order. No error can lie where the application judge ordered the relief sought by both parties.

(2) No. Section 217 grants an application judge the power to make a wide range of orders in connection with dissolution and liquidation. A court may make any fit order and there is no limit on the court’s power to make any fit order. Section 217 does not mandate the appointment of a liquidator when a court orders liquidation. In this case, the application judge found that the Fund’s process without a court-appointed liquidator was appropriate due to the modest size of the Fund, the unique nature of the Fund’s illiquid securities, and the greater efficiency achieved by allowing the Fund’s expert to continue versus a court-appointed liquidator starting anew.

Peoples Trust Company v. Atas, 2019 ONCA 359

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

Counsel:

N.A., in person

C.J. Wallis, for the corporate respondent

Y. Gulia, for the individual respondents

G. Caplan, for the remaining respondents

Keywords: Civil Procedure, Vexatious Litigants, Self-Represented Litigants, Case Management, Pre-Screening Chavali Orders, Functus Officio, Courts of Justice Act, R.S.O. 1990, c. C. 43, s. 140, Chavali v. Law Society of Upper Canada, [2006] O.J. No. 2036 (SC), Housen v. Nikolaisen, 2002 SCC 33, R. v. Jordan, 2016 SCC 27, Hamilton v. Open Window Bakery Ltd., 2004 SCC 9

FACTS:

The appellants were declared vexatious litigants under the Courts of Justice Act, s. 140 (“CJA”). The application judge who heard the s. 140 application was also the case management judge for the underlying litigation.

ISSUES:

(1) Did the application judge have jurisdiction to hear the s. 140 application?

(2) Did the application judge err in finding that the appellants had acted in a vexatious manner in defending proceedings brought against them, or in requiring the appellants to seek leave prior to taking further steps in defending such proceedings?

(3) Did the application judge err in finding that the court had jurisdiction to make a pre-screening Chavali Order or in writing the terms thereof?

(4) Is the continuation of case management and the Chavali Order unfair to the individual appellant as a self-represented litigant?

HOLDING:

Appeal dismissed.

REASONING:

(1) Yes. In the four-year process of case managing the underlying litigation, the application judge did not conduct any settlement discussions or hold a pre-trial in respect of the underlying litigation or the s. 140 application. In addition, the appellants did not appeal from the application judge’s ruling in 2015, made when this issue was first raised by the appellants, that he had jurisdiction to hear the s. 140 application.

(2) No. The court has broad discretion to control its process and to make appropriate orders where vexatious proceedings have been instituted or proceedings have been conducted in a vexatious manner, pursuant to the CJA, s. 140 and the court’s inherent jurisdiction. This jurisdiction extends to a litigant’s conduct in defending proceedings. Thus, it was appropriate to require the appellants to seek leave before taking any other steps in such proceeding.

(3) No. The order required the appellants to: (1) obtain leave to proceed with a proceeding or a step in any court in Ontario; (2) provide the application judge’s decision and reasons to any non-Ontario court or any administrative body, commission or tribunal; and (3) provide the application judge’s decision and reasons to a peace officer or judicial officer prior to commencing criminal proceedings or making a complaint. The order does not purport to control the process of other courts or bodies that may control their own processes.

(4) No. At the core of the court’s jurisdiction under the CJA, s 140 and the court’s inherent jurisdiction is the discretion to control its process and prevent abuse of its process. Unchecked, abusive and vexatious proceedings consume scarce resources at the expense of all litigants, including other self-represented litigants who deserve ready access to justice. Every person involved in the judicial system must ensure and facilitate more timely access to the courts. In addition, the doctrine of functus officio does not apply to the continued case management of the underlying proceedings pursuant to both the Rules of Civil Procedure and the terms of judgment (including the Chavali Order).

Curley v. Taafe, 2019 ONCA 368

[Lauwers, Pardu and Nordheimer JJ.A.]

Counsel:

P.J. Zibarras, for the appellant

L. Poliacik, for the respondent

Keywords: Contracts, Breach of Contract, Torts, Malicious Prosecution, Evidence, The Rule in Browne v. Dunn (1893), 6 R 67 (UKHL), Pate v. Galway-Cavendish, 2011 ONCA 329, leave to appeal refused, [2011] SCCA No. 293, Nelles v. Ontario, [1989] 2 SCR 170, Correia v. Canac Kitchens (2007), 56 CCEL (3d) 209 (ONSC), Kefeli v. Centennial College of Applied Arts and Technology (2000), 23 CPC (5th) 35 (ONCA, in Chambers), Peters v. Perras (1909), 42 SCR 244, Yan v. Nadarajah, 2017 ONCA 196, R. v. Find, 2001 SCC 32

FACTS:

The respondent, who was an unlicensed paralegal, entered into a contract with the appellant lawyer whereby she referred clients to the appellant while retaining the paralegal work. The contract also dictated that the respondent would return the appellant’s files if the contract was terminated, which it ultimately was. The appellant testified that she terminated the contract on January 15, 2013. The respondent testified that she knew of the termination by February 19, but submitted that the appellant had breached the contract by unilaterally terminating it. The appellant testified that she asked the respondent to return the files on January 15, 2013, but the respondent failed to do so. The respondent testified that she returned closed files, of her own initiative, but kept two others.

The appellant testified that on February 27, she complained to the police regarding the files. On March 2, an officer went to the respondent’s home and showed the respondent a list of seven files the appellant wanted. The respondent provided the officer with the two files she had kept. On April 30, the appellant forwarded to the police a letter sent to her by the respondent dated April 23, in which the respondent admitted to possessing the outstanding files. Consequently, police charged the respondent with theft and possession of stolen property. Those charges were ultimately withdrawn. Later, the appellant learned the respondent was using her letterhead without her consent. The respondent testified that she had authorization to use the letterhead. The appellant again spoke to the police. Charges of fraud and forgery were laid, but were also withdrawn.

The respondent sued for breach of contract and malicious prosecution. The trial judge accepted the respondent’s evidence, finding the appellant not credible. He found that the appellant did not terminate the parties’ relationship on January 15, and that the respondent’s possession of the files and use of letterhead was with the appellant’s consent. Regarding malicious prosecution, he found that the appellant made misleading statements to police and withheld exculpatory evidence. The misleading statements were that the appellant ended the contractual relationship on January 15, and that the respondent was not authorized to use the appellant’s letterhead. Further, although no evidence was elicited from the police, the trial judge concluded that had police known the truth, the first information would never have been laid. Pursuant to Browne v. Dunn, he refused to give any weight to the April 23 letter, in which the respondent acknowledged possession of the files. The trial judge reasoned that because the appellant’s counsel did not cross-examine the respondent about the specific parts of her own letter in which she appeared to acknowledge possession of the appellant’s files, he was only left to speculate as to what the respondent meant.

The trial judge awarded damages for the appellant’s termination of the contract, reflecting the earnings the respondent would otherwise have accumulated. There was no evidence of an attempt by the respondent to mitigate by referring client files to other lawyers or doing similar work. The trial judge rejected the argument that there was insufficient evidence of reasonable efforts to mitigate, by taking judicial notice of the effect of criminal charges on her ability to find work.

ISSUES:

(1) Did the trial judge err in concluding that the appellant initiated the respondent’s prosecution?

(2) Did the trial judge err in applying the rule in Browne v Dunn?

(3) Did the trial judge err in taking judicial notice of the effect of a criminal charge on a paralegal’s practice, and upon the respondent’s ability to mitigate her damages?

HOLDING:

Appeal allowed.

REASONING:

(1) Yes. The Court noted that there are four elements to malicious prosecution: 1) the proceedings must have been initiated by the defendant; 2) the proceedings must have terminated in favour of the plaintiff; 3) the proceedings were instituted without reasonable and probable cause; and 4) the defendant must be actuated by malice. With respect to the first element, the Court elaborated that a complainant may be treated as the prosecutor in certain circumstances: where the complainant desired and intended that the plaintiff be prosecuted; where the facts were so peculiarly within the complainant’s knowledge that it was virtually impossible for the prosecutor to exercise independent discretion; and where the complainant procured the institution of proceedings, either by furnishing false information or by withholding true information. In the present case, there was no evidence adduced at trial from the police as to the effect of the appellant’s complaints on their investigation. The evidence suggested that the police exercised independent discretion, firstly not to lay charges, and later, after hearing both sides and drawing inferences, to lay the charges.

(2) Yes. The Court observed that the respondent’s April 23 letter, which the trial judge discounted by applying the rule in Browne v Dunn, amounted to an admission that she retained the appellant’s files when she knew their relationship was over. The respondent admitted in cross-examination to writing the letter and delivering it. However, she did not explain her statements in the letter about packaging “up any and all files/documents here in my office that relate to your clients” and refusing to surrender them unless conditions were met. Further, the respondent also did not explain such statements during re-examination. The Court noted that, although trial judges have discretion as to the remedy for a breach of the rule in Browne v. Dunn, the rule was not even engaged here. Since the rule is meant to prevent an ambush of a witness by giving them an opportunity to state their position with respect to evidence which contradicts them on an essential matter, and since there was no unfairness or surprise associated with the appellant’s reliance on the respondent’s own letter at trial, the trial judge therefore erred in relying on Browne v. Dunn to discount this evidence.

(3) Yes. The respondent had other lawyers to whom she could refer files. Apart from her own testimony, there was no evidence that the charges had any effect on her ability to work or refer files. The respondent failed to produce any witnesses to testify that she could not secure new business. Further, the Court held that the trial judge erred in relying on judicial notice, since it is only available in two circumstances: where facts are either (1) so notorious or generally accepted as not to be the subject of debate among reasonable persons, or (2) capable of immediate and accurate demonstration by resort to readily accessible sources of indisputable accuracy. Accordingly, the Court concluded that the respondent failed to mitigate her damages.

Forbes Energy Group Inc. v. Parsian Energy Rad Gas, 2019 ONCA 372

[Doherty, Rouleau and Brown JJ.A.]

Counsel:

R. Staley and J. Berall, for the appellant

M. Mendelzon, for the respondents

Keywords: Contracts, Breach of Contract, Forum Selection Clauses, Civil Procedure, Conflict of Laws, Jurisdiction, Forum Non Conveniens, Real and Substantial Connection, Strong Cause Test, Douez v. Facebook, Inc, 2017 SCC 33, Novatrax International Inc v. Hagele Landtechnick GmbH, 2016 ONCA 771, Club Resorts Ltd. v. Van Breda, 2012 SCC 17, Young v. Tyco International of Canada Ltd., 2008 ONCA 709, A1 Pressure Sensitive Products Inc. v. Bostik, Inc., 2009 ONCA 206

FACTS:

The parties entered into a term sheet regarding an upstream oil and gas rights transaction in Iran. The term sheet contained the following clause: “[t]his term sheet shall be governed by and construed in accordance with the laws of England and the Parties agree to attorn to the courts of England” (the “Clause”). When the respondents demanded that the appellant make certain payments under the term sheet, the appellant disputed its obligation to do so and commenced this action in Ontario for a declaration that it was under no obligation to make the payments. The respondents moved to stay the action in favour of the English courts and were granted a stay. Although finding that the Ontario courts had jurisdiction over the subject-matter of the dispute, the motion judge declined jurisdiction since the appellant had failed to demonstrate strong cause that the Clause should not be enforced. Applying the strong cause test and the forum non conveniens factors, she held that England was a more appropriate forum than Ontario.

ISSUE:

(1) Did the motion judge err in staying the Ontario action commenced by the appellant on the basis of the strong cause test and forum non conveniens factors?

HOLDING:

Appeal allowed.

REASONING:

(1) Yes. The parties agreed that the strong cause test only applies to forum selection clauses that by their terms grant exclusive jurisdiction to a foreign jurisdiction. The motion judge did not make a finding that the Clause amounted to an exclusive jurisdiction clause. Thus, the motion judge erred in using the strong cause test. As a result of this error, the Court of Appeal conducted a fresh forum non conveniens analysis. While the Clause remains a factor in the analysis, it does not have determinative weight but must be considered together with the factors set out in Young v. Tyco International of Canada Ltd (“Young”).

In considering the Young factors, the Court noted that: (1) there was no evidence that the term sheet was signed in either England or Ontario; (2) (a) there wasn’t a strong connection between the term sheet’s subject matter and England; and (b) since the witnesses were scattered around the world, there was no one location that would be more convenient for the witnesses; (3) it is a common occurrence for an Ontario court to apply foreign law; (4) the loss of a legitimate juridical advantage was not present; and (5) there was no indication that the respondents contemplated bringing an action concerning the term sheet in England, thereby triggering the appellant’s obligation under the Clause to attorn to the jurisdiction of English courts.

Since the respondents had not demonstrated that England was clearly a more appropriate forum in which to litigate the dispute, the Court was not prepared to decline the exercise of jurisdiction by the Ontario courts to hear the action.

Service Mold + Aerospace Inc. v. Khalaf, 2019 ONCA 369

[Doherty, Paciocco and Zarnett JJ.A.]

Counsel:

G.R. Hall and N.E. Fitz, for the appellant

M.W. Shulgan and N. Marcus, for the respondents

Keywords: Torts, Conversion, Negligence, Banking, Negotiable Instruments, Cheque Fraud, Strict Liability, Contracts, Verification Agreements, Civil Procedure, Partial Summary Judgment, Limitation Periods, Discoverability, Limitations Act, 2002, S.O. 2002, c. 24, Sched B, s. 5, Bills of Exchange Act, R.S.C. 1985, c. B-4, s. 4, Baywood Homes Partnership v. Haditaghi, 2014 ONCA 450, Hryniak v. Mauldin, 2014 SCC 7, Butera v. Chown, Cairns LLP, 2017 ONCA 783, Corchis v. KPMG Peat Marwick Thorne, [2002] OTC 475 (CA)

FACTS:

The respondent corporations (the “respondents”) were defrauded by their bookkeeper. The bookkeeper used forged cheques (the “cheque fraud”) and made unauthorized payroll payments into her bank account (the “payroll fraud”). The bookkeeper was terminated in 2012 for unrelated reasons.  In 2015, the respondents received information that the bookkeeper had been fired from her subsequent employer for forging cheques. After conducting an examination, the respondents discovered the cheque fraud and payroll fraud.

The respondents sued the appellant bank (the “appellant”), claiming that the appellant was strictly liable and liable in negligence for the cheque fraud and liable in negligence for the payroll fraud. The appellant bank defended both claims based on a Business Banking Agreement (the “BBA”) which contained a verification clause and a limited liability clause (the “BBA Defence”) and on the Limitations Act, 2002 (the “Limitations Defence”).

In 2016, the respondents brought a successful motion for partial summary judgment based on its strict liability claim relating to the cheque fraud. In 2017, the motion judge found that there was no genuine issue to be tried on the BBA Defence or the Limitations Defence to the cheque fraud, because there was no evidence that the respondents had signed a BBA. She also held that she could not determine the discoverability issue without a mini-trial which was held in 2018, after which the motion judge granted partial summary judgment and found that the limitation period did not begin to run until early 2015 and had not passed when the statement of claim was issued.

ISSUES:

(1) Did the motion judge err in proceeding with a motion for partial summary judgment?

(2) Did the motion judge misapply the test for discoverability?

HOLDING:

Appeal allowed.

REASONING:

(1) Yes. The guiding principles for partial summary judgment are more complex than ordinary summary judgment motions because partial judgment may increase the risk of duplicative proceedings or inconsistent findings. In addition, partial judgment can frustrate the Hryniak objective of using summary judgment to achieve proportionate, timely and affordable justice.  Used improperly, partial judgment can cause delay, increase expense and increase the danger of inconsistent findings at trial made on a more complete record. Partial judgment is a rare procedure reserved for issues that may be readily bifurcated from those in the main action and that may be dealt with expeditiously and in a cost effective manner.

The motion judge erred when evaluating the risk of overlap. She proceeded to partial judgment because: she had not heard evidence about the payroll fraud, there would not have been additional evidence on the cheque fraud at trial, there may or may not be a different date for the commencement of limitations periods and there would only possibly be different office procedures and considerations as to when the respondents ought to have been aware of the loss.  She looked to see whether overlap had been demonstrated. She should not have proceeded to partial judgment unless she was satisfied affirmatively that the issues before her could be bifurcated without causing overlap that could lead to duplication or inconsistent findings.

In addition, the motion judge erred in her reasoning. The fact that she heard no evidence of the payroll fraud during the motion is, without more, uninstructive on whether she would be apt to hear evidence that would be relevant to the limitation period for the cheque fraud claim during the payroll fraud trial. Most importantly, she gave insufficient weight to the risk of overlap in the evidence relating to the Limitations Defence. The motion judge also failed to recognize that the BBA Defence was pleaded in response to both claims, not just the cheque fraud. As the BBA Defence was left open on the payroll fraud claim, the risk of a different result went without consideration by the motion judge.

(2) Yes. Subsection 5(1)(b) of the Limitations Act, 2002, establishes a “modified objective test” which seeks to make an objective determination by inquiring as to what a reasonable person ought to have known, but it imbues the hypothetical reasonable person with the subjective “abilities” and “circumstances of the person with the claim.”  Section 5(1)(b) is about knowing what one ought to know. The reasonable person component serves to ensure that a plaintiff acted with reasonable levels of prudence and attention in attending to the risk of injury, loss or damage. Section 5(1)(b) requires that once material characteristics are attributed to the reasonable person, that hypothetical person will remain reasonable.

The motion judge assumed that a reasonable person would have had the same bookkeeping practices as the respondents had. The motion judge clearly erred in applying the modified objective test by conducting a purely subjective inquiry. Rather than imbuing the hypothetical person with the abilities and circumstances of the respondents’ owner, she imparted on that person the attitudes and practices of the respondents’ owner, thereby defeating the objective reasonableness inquiry. It is an error to infer that the reasonable person would conduct itself in the same way that the respondent did. Further, if the hypothetical person is imbued with unreasonable imprudence or inattention, then the objective component of the test is defeated.

Donovan v. Sherman Estate, 2019 ONCA 376

[Doherty, Rouleau and Hourigan JJ.A.]

Counsel:

The personal appellant, appearing in person

T. Youdan and C. Cseh, for the respondents

Keywords: Wills and Estates, Civil Procedure, Sealing Orders, Open Court Principle, R. v. Mentuck, [2001] 3 S.C.R. 442, Atomic Energy of Canada v. Sierra Club of Canada, [2002] 2 S.C.R. 522

FACTS:

The appellant newspaper and reporter brought a motion to terminate or vary sealing orders made in respect of the administration of the Sherman estate. With minor exceptions, the motion judge dismissed the motion, albeit providing that the sealing orders would expire in two years. The motion judge acknowledged that orders restricting public access to court proceedings are very much the exception, and that the party seeking a sealing order carries the burden of demonstrating the need for the order. The motion judge pointed to two concerns which satisfied him that sealing orders were necessary. First, he referred to the need to protect the privacy and dignity of the victims of violent crime and their loved ones. Second, he referred to the reasonable apprehension of risk to those who have an interest in receiving or administering the estate’s assets. The motion judge reasoned that, because the estate administration was precipitated by murders the perpetrators and motive of which remained unknown, it therefore followed that anyone with an “interest in receiving or administering the assets” was under a reasonable apprehension of harm.

ISSUE:

(1) Did the motion judge err in preserving the sealing orders?

HOLDING:

Appeal allowed.

REASONING:

(1) Yes. The Court confirmed that the motion judge correctly identified the two-part test to be applied when deciding whether to grant a sealing order. First, the party seeking the order must show that the order is necessary to prevent a serious risk to an important public interest which cannot be protected by alternative methods. Second, they must also establish that the salutary effects of the sealing order outweigh its deleterious effects, including the negative effects on the right to freedom of expression and other public interests served by open and accessible court proceedings. If the moving party fails at the first stage of the test, a sealing order cannot be granted.

The Court noted that although persons close to the estate administration understandably wanted to keep matters private and grieve outside of the public spotlight, those concerns were of a personal nature. However, the kind of interest that is properly protected by a sealing order must have a public interest component. Personal concerns cannot, without more, justify an order sealing material that would normally be available to the public under the open court principle. The concerns of a personal nature would have been relevant only at the second stage of the inquiry.  The second interest was no doubt an important public interest, but had to be supported by evidence that there was a real safety risk. Here, the respondents did not proffer sufficient evidence to suggest that disclosure of the estate files posed a real risk to anyone’s personal safety. In the Court’s view, the motion judge’s analysis came down to the proposition that because the estate administration was precipitated by a murder the circumstances of which were unclear, individuals named as beneficiaries or administrators of the estate were at risk of serious physical harm. This was not an available inference, but merely speculation and therefore no basis for a sealing order.

Ruffolo v. David, 2019 ONCA 385

[Doherty, Rouleau and Brown JJ.A.]

Counsel:

V P. Ambrosino and A. Voss, for the appellant

R Sawhney, for the respondent

Keywords: Family Law, Custody and Access, Civil Procedure, Orders, Enforcement, Contempt, Sabourin and Sun Group of Companies v. Laiken, 2011 ONCA 757, Carey v. Laiken, 2015 SCC 17

FACTS:

The parties were involved in litigation over custody and access to their children. Although access provisions were agreed to and subsequently incorporated into a court order, the respondent later brought contempt proceedings against the appellant. The motion judge dismissed almost all of the respondent’s allegations, although he did make three findings of contempt. For reasons that were unclear, the appellant appealed before the court had held the sanction hearing.

ISSUE:

(1) Did the motion judge err in finding the appellant in contempt?

HOLDING:

Appeal allowed.

REASONING:

(1) Yes. The Court first noted that an appeal from a contempt finding is not usually heard until the sanction has been imposed. Otherwise, the appeal court will not know how serious the motion judge considered the contempt to be or how the judge intended to bring about compliance or punish the contemnor. These are elements integral to an appellate court’s full appreciation of the disposition under appeal. Nevertheless, the Court concluded here that it should exercise its discretion to hear the appeal, albeit cautioning that the decision to proceed should not be taken as an indication that this is the appropriate or usual procedure.

Turning to the merits of the appeal, the Court found that the record before the motion judge did not support his findings of contempt, and that he did not address the important background fact that the respondent had not regularly exercised his access rights for years. All three of the motion judge’s findings of contempt were erroneous, as the appellant’s conduct fell within the terms of the order and therefore did not amount to a failure to comply. Lastly, the Court sounded two notes of caution: first, that contempt orders should not be so readily granted by motion judges, as courts have consistently discouraged the routine use of contempt to obtain compliance with court orders. If contempt were found too easily, its use would cheapen the role and authority of the very judicial power it is meant to protect. Second, where the main issues concern access to children, the best interests of the children should be the paramount consideration.


SHORT CIVIL DECISIONS

Ontario (Transportation) v. 2523654 Ontario Inc., 2019 ONCA 370

[Watt, Pardu and Nordheimer JJ.A.]

Counsel:

E. Gionet and A. Wood, for the appellants

S. Valair, for the respondent

Keywords: Provincial and Regulatory Offences, Highways, Public Transportation and Highway Improvement Act, R.S.O. 1990, c. P.50, s. 112

Salman v. Patey, 2019 ONCA 365

[Feldman, Miller and Fairburn JJ.A.]

Counsel:

R. Salman, self-represented

S. Sack, for the responding parties

Keywords: Civil Procedure, Appeals, Extension of Time, Summary Judgment

Stanley v. Patrice, 2019 ONCA 373

[Doherty, Rouleau and Brown JJ.A.]

Counsel:

The personal appellant, appearing in person

E. M. Cohen and D. W. Cahill, for the respondent

Keywords: Family Law, Child Support, Jurisdiction, Family law Rules, O. Reg. 114/99, Rule 1(8.1)


CRIMINAL DECISIONS

Canada v. McDonald, 2019 ONCA 367

[Feldman, Miller and Fairburn JJ.A.]

Counsel:

M. Crystal, for the respondent L.J.M.

M. Crystal, for the appellant L.J.M., C65498

D. Friesen, for the respondent, Her Majesty the Queen in Right of Ontario

Keywords: Criminal Law, Conspiracy to Commit Human Smuggling, Manslaughter by Criminal Negligence, Right to Counsel, Jeopardy, K.G.B. Statements

R. v. Majeed, 2019 ONCA 366

[Feldman, Miller and Fairburn JJ.A.]

Counsel:

M. Dineen, for the appellant

A. Cappell, for the respondent

Keywords: Criminal Law, Credit Fraud, Inducing a Person to Act on a False Document

R. v. Bartholomew, 2019 ONCA 377

[Roberts, Trotter and Paciocco JJ.A]

Counsel:

A. Burgess, for the appellant

J. D. Tatum, for the respondent

Keywords: Criminal Law, Sexual Assault, Sexual Interference, Evidence, Credibility, Criminal Code, ss. 151, 271, R. v. L.L., 2009 ONCA 413, R. v. White (1996), 29 O.R. (3d) 577 (C.A.)

R. v. Badgerow, 2019 ONCA 374

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

Counsel:

I. Grant and J. Marshman, for the appellant

J. Klukach and D. Garg, for the respondent

Keywords: Criminal Law, First Degree Murder, Sexual Assault, Abuse of Process, Evidence, Hearsay, Jury Instructions, Criminal Code, ss. 229(a) and 653.1, R. v. Badgerow, 2008 ONCA 605, R. v. Badgerow, 2014 ONCA 272, R. v. Calnen, 2019 SCC 6, R. v. Victoria, 2018 ONCA 69

R. v. Said, 2019 ONCA 378

[MacPherson, Juriansz and Rouleau JJ.A]

Counsel:

The personal appellant, appearing in person

A. Hotke, for the respondent

M. Gourlay, duty counsel

Keywords: Criminal Law, Assault With a Weapon, Assault Causing Bodily Harm, R. v. Stucky, 2009 ONCA 151, R. v. Murray, 2017 ONCA 393

R. v. C.B., 2019 ONCA 380

[Watt, Huscroft and Fairburn JJ.A.]

Counsel:

M. Lacy and J. Harbic, for the appellant C.B.

M. Gourlay, for the appellant A.C.

J. Smith Joy, for the respondent Crown

Keywords: Criminal Law, Assault, Sexual Assault, Unlawful Confinement, Evidence, Authenticity, Credibility, Fresh Evidence, Canada Evidence Act, R.S.C. 1985, c. C-85, ss. 31.1 and 31.8, Criminal Code, ss. 683(1) and 686(1)(a)(iii), R. v. Hirsch, 2017 SKCA 14, R. v. Nikolovski, [1996] 3 S.C.R. 1197, R. v. Morrissey (1995), 97 C.C.C. (3d) 193 (Ont. C.A.), R. v. Lohrer, 2004 SCC 80, R. v. Palmer, [1980] 1 S.C.R. 759, Truscott (Re), 2007 ONCA 575

R. v. Campbell, 2019 ONCA 382

[MacPherson, Juriansz and Rouleau JJ.A.]

Counsel:

The personal appellant, in person

L. P. Strezos, duty counsel

A. Hotke, for the respondent

Keywords: Criminal Law, Sentencing, Pre-Sentence Custody

R. v. Hansen, 2019 ONCA 381

[MacPherson, Juriansz and Rouleau JJ.A]

Counsel:

The personal appellant, in person

M. Gourlay, duty counsel

L. Schwalm, for the respondent

Keywords: Criminal Law, Sentencing, Driving Prohibition, Criminal Code, s. 259(1) and (2)

R. v. Hartwick, 2019 ONCA 383

[MacPherson, Juriansz and Rouleau JJ.A.]

Counsel:

No one appearing for the appellant

M. Gourlay, duty counsel

L. Schwalm, for the respondent

Keywords: Criminal Law, Appeal Abandoned

R. v. Menezes, 2019 ONCA 384

[MacPherson, Juriansz and Rouleau JJ.A.]

Counsel:

The personal appellant, in person

L. P. Strezos, duty counsel

A. Hotke, for the respondent

Keywords: Criminal Law, Appeal Abandoned

R. v. Chioros, 2019 ONCA 388

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

Counsel:

M. C. Halfyard, for the appellant

J. Conroy, for the respondent

Keywords: Criminal Law, Possession, Possession for the Purpose of Trafficking, Evidence, Confidential Informants, Debot Factors, Search and Seizure, Reasonable and Probable Grounds, Credibility, Corroboration, Grant Factors, Canadian Charter of Rights and Freedoms, ss. 8, 9 and 24(2), R. v. Debot, [1989] 2 S.C.R. 1140, R. v. Grant, 2009 SCC 32

R. v. Mehedi, 2019 ONCA 387

[Watt, Pardu and Nordheimer JJ.A]

Counsel:

The appellant, in person

K. Papdopoulos, for the moving party

Keywords: Criminal Law, Hybrid Offences, Summary Dismissal, Application for Certiorari, Vexatious Litigants, Criminal Code, s. 685, Interpretation Act, R.S.C., 1985, c. I-21, s. 34(1)(a)

R. v. Abreha, 2019 ONCA 392

[Lauwers, van Rensburg and Trotter JJ.A.]

Counsel:

G. Haskell, for the appellant

S. Reid, for the respondent

Keywords: Criminal Law, Firearms Offences, Loss of Evidence, Stay of Proceedings, Jury Instructions, Canadian Charter of Rights and Freedoms, s. 7, R. v. Bero (2000), 151 C.C.C. (3d) 545 (Ont. C.A.), R. v. Hersi, 2019 ONCA 94, R. v. Stinchcombe, [1991] 3 S.C.R. 326

United States v. Ebanks, 2019 ONCA 390

[MacPherson, Juriansz and Rouleau JJ.A.]

Counsel:

G. Haskell, for the appellant

S. Reid, for the respondent

Keywords: Criminal Law, Firearms Offences, Loss of Evidence, Stay of Proceedings, Jury Instructions, Canadian Charter of Rights and Freedoms, s. 7, R. v. Bero (2000), 151 C.C.C. (3d) 545 (Ont. C.A.), R. v. Hersi, 2019 ONCA 94, R. v. Stinchcombe, [1991] 3 S.C.R. 326


ONTARIO REVIEW BOARD

LePage (Re), 2019 ONCA 363

[Brown, Roberts and Zarnett JJ.A.]

Counsel:

M. Davies, for the appellant

C. Tier, for the respondent Attorney General of Ontario

Keywords: Ontario Review Board, Criminal Law, Possession of a Weapon for a Purpose Dangerous to the Public Peace, Not Criminally Responsible, Significant Threat to Public Safety, Criminal Code, ss. 672.78(3)(a) and (c), Part XX.1, Gonzales (Re), 2017 ONCA 102, Ontario (Attorney General) v. Taylor, 2010 ONCA 35

Jakaj (Re), 2019 ONCA 379

[Feldman, Miller and Fairburn JJ.A.]

Counsel:

R. Browne, for the appellant

C. Sharawy, for the respondent

Keywords: Ontario Review Board, Criminal Law, Detention Orders, Significant Threat to the Public, Criminal Code, Part XX.I, Mental Health Act, R.S.O. 1990, c. M.7

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.