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Good afternoon,

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

In Urbancorp Toronto Management, the Monitor unsuccessfully sought to set aside security granted in favour of Urbancorp’s arm’s length electrical contractor as being a transaction under value or a fraudulent conveyance. The basis of the challenge was not that the electrical contractor was not an arm’s length party (it was arm’s length), but that the party that provided the contractor with the impugned security was not arm’s length from the party that owed the debt to the electrical contractor. The Court rejected this approach. It confirmed that the focus of the analysis had to be on the relationship between the transferor and transferee, not between the transferor and other parties related to the transferor that may have benefitted from the transaction.

Other topics covered this week included family law, insurance coverage, enforcing settlements, adding parties after a limitation period expires, and obtaining dispensation from some of the requirements of perfecting an appeal.

Wishing everyone an enjoyable weekend, and Shanah Tovah to those celebrating Rosh Hashanah.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email


Table of Contents

Civil Decisions

Derakhshan v. Narula, 2019 ONCA 742

Keywords: Family Law, Spousal Support, Spousal Relationship, Common Law Relationship, Unjust Enrichment, Constructive Trust, Joint Family Venture, Reasonable Apprehension of Bias, Family Law Act, R.S.O. 1990, c. F.3, s. 29, Pettkus v. Becker, [1980] 2 S.C.R. 834, Kerr v. Baranow, 2011 SCC 10

Paterson Veterinary Professional Corporation v. Stilton Corp. Ltd., 2019 ONCA 746

Keywords: Contracts, Specific Performance, Frustration, Civil Procedure, Settlements, Enforcement, Applications, Rules of Civil Procedure, Rule 14.05(3), Di Millo v. 2099232 Ontario Inc., 2018 ONCA 1051, Naylor Group Inc. v. Ellis-Don Construction Ltd., 2001 SCC 58, Holst v. Singh, 2018 ONSC 4220, Semelhago v. Paramadevan, [1996] 2 S.C.R. 415

Rumsam v. Pakes, 2019 ONCA 748

Keywords: Torts, Negligence, MedMal, Civil Procedure, Limitation Periods, Discoverability, Limitations Act, 2002, ss 4, 5(1), Sloan v. Ultramar Limited, 2011 ONCA 91, Pepper v. Zellers Inc. (2006), 83 OR (3d) 648 (CA), Lawless v. Anderson, 2011 ONCA 102, Brown v. Wahl, 2015 ONCA 778, Klein v. G4S Secure Solutions (Canada) Ltd., 2016 ONSC 1930

1472292 Ontario Inc. (Rosen Express) v. Northbridge General Insurance Company, 2019 ONCA 753

Keywords: Insurance, Coverage, Civil Procedure, Applications, Orders, Declarations, Multiplicity of Proceedings, Solosky v. The Queen, [1980] 1 SCR 821, Courts of Justice Act, RSO 1990, c C43, s. 138

Segura Mosquera v. Ottawa (City), 2019 ONCA 760

Keywords: Civil Procedure, Appeals, Perfection, Extension of Time, Dispensation from Requirements, Administration of Justice Act, s. 4.2, Rules of Civil Procedure, Rules 61.09, 61.10(1)(d)

Urbancorp Toronto Management Inc. (Re), 2019 ONCA 757

Keywords: Bankruptcy and Insolvency, Transfers at Undervalue, Fraudulent Conveyances, Civil Procedure, Costs, Monitors, Evidence, Credibility, The Rule in Browne v. Dunn, Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36, s. 36.1, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, ss. 4(4), 96, Fraudulent Conveyances Act, R.S.O. 1990, c. F.29, s. 2, Browne v. Dunn (1893), 6 R. 67 (H.L)

Short Civil Decisions

Lee v. Lalu Canada Inc., 2019 ONCA 750

Keywords: Civil Procedure, Appeals, Jurisdiction, Orders, Final or Interlocutory, Sun Life Assurance Co. v. York Ridge Developments Ltd. (1998), 116 A.O.C. 103, Cytrynbaum v. Look Communications Inc., 2013 ONCA 455

Makovskis v. McKenney, 2019 ONCA 755

Keywords: Family Law, Matrimonial Home, Civil Procedure, Orders, Enforcement, Writs of Seizure and Sale, Family Law Act, s. 21

Tsui-Wong v. Xiao, 2019 ONCA 756

Keywords: Civil Procedure, Costs, Appeals, Fraudulent Conveyances, Fraudulent Conveyances Act, R.S.O. c. F.29, Assignments and Preferences Act, R.S.O. 1990, c. A.33

Broutzas v. Rouge Valley Health System, 2019 ONCA 751

Keywords: Appeal Book Endorsement, Class Proceedings Act, 1992, S.O. 1992, c. 6, s. 30

Stephens v. Stephens, 2019 ONCA 752

Keywords: Appeal Book Endorsement, Civil Procedure, Vexatious Litigants, Orders, Setting Aside, Procedural Fairness, Courts of Justice Act, R.S.O. 1990, c. C. 43, s. 140

Criminal Decisions

R. v. Johannes, 2019 ONCA 696

Keywords: Criminal Law, Drug Offences, Certiorari, R. v. Kamermans, [2016] O.J. No. 685 (C.A.)

R. v. Cumor, 2019 ONCA 747

Keywords: Criminal Law, Conspiracy to Traffic Cocaine, Conspiracy to Traffic Firearms, Possession of a Firearm, Possession of Proceeds of Crime, Procedural Fairness, Jury Selection, Jury Instructions, Jury Charge, Criminal Code, ss. 591(3)(a), 640(2), 640(2.1), 640(2.2), 686(1)(b)(iv), R. v. Jaser, 2014 ONSC 7528, rev’d 2019 ONCA 672, R. v. Grant, 2016 ONCA 639, R. v. Husbands, 2017 ONCA 607, leave to appeal refused, [2017] S.C.C.A. No. 364, R. v. Esseghaier, 2019 ONCA 672, R. v. Riley, 2017 ONCA 650, leave to appeal refused, [2018] S.C.C.A. No. 216, R. v. Murray, 2017 ONCA 393, R. v. Noureddine, 2015 ONCA 770, R. v. Swite, 2011 BCCA 54, R. v. Evans, 2019 ONCA 715, R. v. A.C., 2018 ONCA 333, R. v. Figliola, 2011 ONCA 457, R. v. Last, 2009 SCC 45, R. v. Puddicombe, 2013 ONCA 506, leave to appeal refused, [2013] S.C.C.A. No 496, R. v. Hamilton, 2011 ONCA 399, R. v. Hebert, [1996] 2 S.C.R. 272, R. v. Calnen, 2019 SCC 6, R. v. Rodgerson, 2015 SCC 38, R. v. R.V., 2018 ONCA 547, rev’d on other grounds, 2019 SCC 41

R. v. Hakimi, 2019 ONCA 749

Keywords: Criminal Law, Aggravated Assault, Firearm Offences, Evidence, Admissibility, Identification, Prior Statements, Video-recorded Statements, Jury Instructions, Sentencing, R. v. Bradshaw, 2017 SCC 35, R. v. Miapanoose (1996), 30 O.R. (3d) 419 (C.A.)

R. v. Curry, 2019 ONCA 754

Keywords: Criminal Law, Dangerous Driving Causing Death, Dangerous Driving Causing Bodily Harm, Impaired Driving Causing Death, Impaired Driving Causing Bodily Harm, Blood Alcohol Over Legal Limit Causing Accident Resulting in Death, Blood Alcohol Over Legal Limit Causing Accident Resulting in Bodily Harm

R. v. O’Leary, 2019 ONCA 758

Keywords: Criminal Law, Robbery, Use of Imitation Firearm, Conspiracy to Commit Robbery, Evidence, Admissibility, Prior Statements, Video-recorded Statements, Mental Illness, Vetrovec Warning, Fresh Evidence, Sentencing, R. v. Vetrovec, [1982] 1 S.C.R. 811

R. v. Beer (Publication Ban), 2019 ONCA 763

Keywords: Publication Ban, Criminal Law, Sexual Assault, Evidence, Credibility, Consent, Sentencing

Ontario Review Board

Davies (Re), 2019 ONCA 738

Keywords: Ontario Review Board, Not Criminally Responsible, Assault with a Weapon, Aggravated Assault, Threat to Public Safety, Conditional Discharge, Detention Orders, Criminal Code, ss. 672.54, 672.92, 672.93, R v Winko, [1999] 2 SCR 625, Esgin (Re), 2019 ONCA 155, Mazzei v British Columbia (Director of Adult Forensic Psychiatric Services), 2006 SCC 7, Campbell (Re), 2018 ONCA 140, R v Owen, 2003 SCC 33, R v Conway, 2010 SCC 22, Boucher (Re), 2015 ONCA 135, Tolias (Re), 2018 ONCA 2015, Collins (Re), 2018 ONCA 563, Centre for Addiction and Mental Health v Young, 2011 ONCA 432, Valdez (Re), 2018 ONCA 657


CIVIL DECISIONS

Derakhshan v. Narula, 2019 ONCA 742

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

Counsel:

FD, acting in person
Ian C. Vallance, for the respondent, SN

FACTS:

The application judge dismissed the appellant, FD’s application for retroactive spousal support, unjust enrichment and consequent constructive trust in twelve properties, a declaration that there was a joint family venture in the accumulated value of the properties, and an order for the return of his shares in an Indigenous staffing company. FD sought an order to set aside the decision and have the case reheard by a new judge.

ISSUES:

(1) Did the application judge make palpable and overriding errors of mixed fact and law?

(2) Did the application judge err by inappropriately copying from the written submissions of SN?

HOLDING:

Appeal dismissed.

REASONING:

(1) No, the application judge did not make palpable and overriding errors of mixed fact and law in regard to any of the following:

Spousal Relationship

While the application judge accepted that FD and SN were in a romantic relationship and lived together for approximately one year, she found that FD failed to prove that he and SN were in a spousal or common-law relationship for three years as required by the Family Law Act. The Court found that there was ample evidence to support this conclusion.

Unjust Enrichment

The application judge found that FD failed to prove his claim for unjust enrichment, as he was unable to adduce evidence to satisfy the court that he was not paid for work that he did or that SN was unjustly enriched at his expense. The Court held that there was ample evidence to support her findings.

Joint Family Venture

There was no evidence that FD was providing services other than services directly related to the properties. There was no pooling of funds or economic integration. At most, there was some financial overlap but no economic integration indicating a joint family venture. The Court found that the application judge’s reasons provided ample basis to conclude that there was no joint family venture.

Transfer of Shares to Turtle Island

The application judge rejected FD’s claims that his shares in the Indigenous staffing company were fraudulently transferred to SN. There was evidence upon which the application judge could reasonably conclude the shares were not fraudulently transferred.

(2) No. FD had the burden of showing that a reasonable person, apprised of the relevant facts, would conclude that the application judge failed to come to grips with the issues and deal with them independently and impartially. The Court found that he failed to do so. The application judge did not copy SN’s written submissions, and carefully reviewed the evidence and the law on the issues before her.

Paterson Veterinary Professional Corporation v. Stilton Corp. Ltd., 2019 ONCA 746

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

Counsel:

W. Jaskiewicz, for the appellant
David Fogel, for the respondent

FACTS:

The appellant, S., appealed from a judgment granted in favour of the respondent, PVPC, enforcing a settlement agreement that the parties concluded in 2013.

ISSUES:

(1) Did the application judge err in finding that an application was an appropriate procedure for enforcing a settlement agreement?

(2) Did the application judge err in finding that the doctrine of frustration was inapplicable in the circumstances of this case?

(3) Did the application judge err in granting the remedy of specific performance?

HOLDING:

Appeal dismissed.

REASONING:

(1) No. S argued that proceeding by way application was inappropriate because there were material facts in dispute. The application judge acknowledged that PVPC had technically erred by failing to refer in its notice of application to the grounds in Rule 14.05(3) of the Rules of Civil Procedure on which the applicant was relying in order to proceed by way of application, she held that this oversight could be corrected in reliance on the standard phrase found in prayers for relief: “such further and other remedies as may be appropriate”. The court found no error with this.

(2) No. The appellant asked the court to find that the dramatic increase in the value of the property since the settlement agreement was negotiated was, in and of itself, a frustrating event. The court declined to do so. The price increase was not a supervening event that made the performance of the contract radically different.

(3) No. The court found that the respondent met its burden of establishing that the property was unique. The property logically had a number of features that made it uniquely suited to the purpose of carrying on a veterinary practice that has, in fact, operated there for decades. An alternative location would be an inadequate substitute because the goodwill associated with the practice was intertwined with this particular property.

Rumsam v. Pakes, 2019 ONCA 748

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

Counsel:

Andrew Kalamut and Scott Robinson, for the appellants
Kristian Bonn, for the respondent

FACTS:

In November 2017, the respondent moved to add Dr. K as a defendant. The motion was granted on the basis that the claim against Dr. K was not statute-barred. The appellants appealed.

ISSUE:

(1) Did the motion judge fail to apply the correct test for discoverability under ss. 5(1) of the Limitations Act, 2002, which provides that a claim is discoverable when the plaintiff has or ought to have knowledge of the material facts of the claim, not when the plaintiff discovers potential liability?

Holding:

Appeal allowed.

REASONING:

(1) Yes. The motion judge made a palpable and overriding error in his finding of mixed fact and law in two ways:

(a) He did not address the fact that, as of August 29, 2013, in her own materials, the respondent provided evidence that she had knowledge of the material facts of the claim, other than the name of the second clinic doctor;

(b) he erred in his application of s. 5(b) of the Limitations Act, 2002, as he did not address the fact that the respondent had an obligation to exercise reasonable due diligence to obtain the name of Dr. K, and whether the respondent had done so.

1472292 Ontario Inc. (Rosen Express) v. Northbridge General Insurance Company, 2019 ONCA 753

[Feldman, Roberts, and Fairburn JJ.A.]

Counsel:

Alan S. Cofman, for the appellant
Patrick J. Monaghan, for the respondent

FACTS:

This appeal arises out of a coverage dispute between a trucking company (“Rosen”) and its insurer (“Northbridge”) as a result of the theft of two containers of electronic goods that Rosen was consigned to deliver for a customer. Following the theft, Rosen asked Northbridge to confirm coverage, but after an investigation, Northbridge sent a letter denying coverage for the stolen goods for two reasons. The customer did not make a claim for its loss to Rosen, but they failed to pay a number of outstanding invoices, which Rosen assumed was a response to the theft. The amount owed for the outstanding invoices was less than the amount of the potential claim, so Rosen decided that it would be imprudent to make any inquiries of the customer regarding the outstanding invoices. Instead, Rosen decided to bring an application against Northbridge seeking a declaration that: (1) Northbridge was obliged to indemnify Rosen for claims in respect of the stolen goods, (2) Northbridge had a duty to defend, and (3) Northbridge was obliged to reimburse Rosen for the costs of responding to the claims.

The insurer filed no material in response because no claim had been made for the loss, and requested an order striking out the relief sought or an adjournment. That request was denied. The application judge declined to make the declaration for indemnity requested in the application, but made two declarations of fact based on the evidence filed by the trucking company which disposed of the Northbridge’s two reasons for denying coverage.

Following the application judge’s decision, Rosen contacted the customer, resulting in confirmation that it had offset from its payables some of the outstanding amount owed for the stolen cargo. Rosen subsequently issued a statement of claim against Northbridge in the subsequent action, claiming damages for breach of contract in that amount and reciting and relying on the two declarations to foreclose any objection to coverage by Northbridge. The Court admitted Rosen’s correspondence with the customer that formed the basis for the subsequent action as fresh evidence.

ISSUES:

(1) Did the application judge err by making declarations in the absence of an underlying claim and therefore a real dispute?

(2) Did the application judge err by declaring findings of fact?

HOLDING:

Appeal allowed.

REASONING:

(1) Yes. The Court looked to the leading decision from the Supreme Court of Canada on this issue: Solosky v. The Queen, [1980] 1 SCR 821 (“Solosky”). In Solosky, Justice Dickson held that there are two factors for the court to consider when exercising its jurisdiction to grant a declaration. The first is the reality of the dispute. Dickson J. explained at p. 832 that “[i]t is clear that a declaration will not normally be granted when the dispute is over and has become academic, or where the dispute has yet to arise and may not arise”. If the dispute is established as a real dispute, then the second factor is “whether the declaration is capable of having any practical effect in resolving the issues in the case”: at p. 833.

In this case, the Court found that neither of the two criteria for granting a declaration of rights were satisfied. First, Rosen sought a declaration that Northbridge was required to indemnify it for a claim that had not yet been made. While the theft had occurred, the party that suffered the loss had not yet sought to recover for that loss from Rosen. There was, as yet, no “real dispute”. It was unclear whether a claim would be made, and if so the nature or extent of the claim. Second, the declarations that were made had no practical effect. The utility of the declarations were only hypothetical, and contingent on a “viable” claim being brought against Rosen. In the Court’s view, this case was not one where a declaration could be made to govern the rights of the parties contingent on a possible future event.

(2) Yes. The Court found that the application judge erred by making findings of fact under the guise of a declaration of right. The Court stated: “Declaratory relief must determine the rights of the parties. While determining the rights of the parties may entail findings of fact, courts do not have jurisdiction to simply declare facts, detached from the rights of the parties. Where the issue between an insured and the insurer is not the interpretation and application of the policy to a specific set of facts, but rather, what were the facts that occurred, then it is not a proper case for declaratory relief.”

As an ancillary point, the Court noted s. 138 of the Courts of Justice Act, which directs that: “As far as possible, multiplicity of legal proceedings shall be avoided.” The Court stated that the effect of the declarations of fact in this case was to leave for another proceeding the issue of coverage, with findings that were intended to be used in a future dispute regarding a claim for compensation for the stolen property. It further noted that the application and this appeal involved the unnecessary expenditure of the resources of the parties as well as judicial resources because all issues could have been resolved in the subsequent action that was commenced by Rosen against Northbridge.

The appeal was allowed and the declarations of fact made by the application judge were set aside. Rather than dismiss the application, the Court ordered that it be consolidated with and continued as part of the subsequent action Rosen has commenced against Northbridge.

Segura Mosquera v. Ottawa (City), 2019 ONCA 760

[Brown J.A. (Motion Judge)]

Counsel:

GSM, in person
David Campbell, duty counsel
Stuart Huxley, for the responding party

FACTS:

The moving party, GSM, filed a notice of appeal from the order of Parfett J. dated July 2, 2019, which dismissed her application against the City of Ottawa (Ottawa Public Library) (hereafter the “Library”).

The origins of the dispute between GSM and the Library involve library fees and a form of notice issued by the Library requiring GSM to leave the premises and not return. GSM commenced an application seeking relief of some sort under the Class Proceedings Act, and injunctive relief.

Parfett J. dismissed the application holding that GSM’s materials did not disclose a cause of action but concerned an administrative dispute between herself and the Library. The application judge dismissed the rest of the requested relief as moot because the Library: (i) had rescinded the notice of eviction; (ii) advised GSM that she was welcome to return; and (iii) provided all the materials necessary to assist in determining what, if any, money GSM owed to the Library.

GSM filed a notice of appeal. Notwithstanding the subsequent passage of 30 days, GSM had not yet perfected her appeal.

ISSUES:

(1) Is GSM entitled to an extension of time to perfect her appeal?

(2) Is GSM entitled to leave to serve her appeal materials electronically?

(3) Should the requirement for GSM to file a transcript of evidence of the proceeding below be dispensed with?

(4) Should the requirement for GSM to file three hard copies of her appeal materials be dispensed with?

Holding:

Motion granted in part.

REASONING:

(1) Yes, GSM is entitled to a modest extension of 30 days to perfect the appeal. The Court was satisfied that in the totality of the circumstances such an extension was warranted.

(2) Yes, the Court allowed GSM to serve her materials electronically.

(3) Yes. The Court saw no need for a transcript of the argument made on the application, which is typically not filed on an appeal. The Court ordered that the agreed-upon transcription of the application judge’s oral reasons satisfied Rule 61.10(1)(d) and was to be included in the appeal book and compendium.

(4) Yes. The Court found that while the $250 to copy and file appeal materials might be a modest amount to some, it represented 25% of GSM’s monthly income. Therefore, the Court was persuaded that it was in the interests of justice to grant GSM relief from filing hard copies of the appeal materials specified in R. 61.09. She was only required to file one electronic copy by email.

Urbancorp Toronto Management Inc. (Re), 2019 ONCA 757

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

Counsel:

Matthew Milne-Smith and Chantelle Cseh, for the appellant, KSV Kofman Inc., in its capacity as Monitor
Kevin D. Sherkin and Jeremy Sacks, for the respondent, Speedy Electrical Contractors Ltd.
Neil Rabinovitch, for GG, the Israeli court-appointed Functionary and Foreign Representative of Urbancorp Inc.

FACTS:

King Residential Inc. (“KRI”) was part of the Urbancorp group of companies, which were all owned by AS and involved in proceedings under the Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36 (“CCAA”).

Speedy Electrical Contractors Ltd. (“Speedy”) performed electrical services for members of the Urbancorp group. In September 2014, Speedy made a personal loan to AS for $1 million, with interest at the rate of 12.5%, evidenced by a promissory note which was to mature on September 23, 2015 (the “Promissory Note”). Speedy also completed work for Edge on Triangle Park Inc. (“Edge”), another Urbancorp entity. A construction lien was registered against this latter project for $1,038, 911.44 on September 30, 2015.

On November 14, 2015, KRI, Speedy, AS and Edge executed a debt extension agreement (the “DEA”) under which:

  • Speedy agreed to extend the due date of the Promissory Note to January 30, 2016;
  • Edge confirmed its debt to Speedy and Speedy agreed to discharge its lien against the Edge project;
  • In consideration of the extension of the Promissory Note, the discharge of the lien, and payment by Speedy to KRI of $2.00, KRI agreed to guarantee the two outstanding debts, secured by a collateral mortgage in Speedy’s favour over 13 KRI condominium units and parking spaces; and
  • KRI agreed to provide evidence showing that there were no common element arrears of the subject condominium units or to pay such arrears on closing, confirmed the taxes on the units were up to date, and agreed that it would obtain a discharge or postponement of a Travellers Guarantee Company of Canada mortgage registered on the subject units.

On November 16, 2015, Speedy discharged its lien against the Edge property, and the collateral mortgage in favour of Speedy was registered on title to the KRI properties.

At the time of the DEA, the beneficial owners of the Urbancorp group’s various development projects were three limited partnerships. KRI was a wholly-owned subsidiary and nominee of one of the limited partnerships, while Edge was a wholly-owned subsidiary and nominee of another.

Part of the impetus behind the DEA was to facilitate a financing of the Urbancorp group through a public bond issuance in Israel. The Israeli bond issuance closed in December 2015. Shortly thereafter, the Urbancorp empire collapsed and all of the Urbancorp group entities commenced insolvency proceedings. On May 18, 2016, KRI and the other Urbancorp entities involved in the proceedings were granted protection under the CCAA.

Speedy filed a proof of claim against KRI pursuant to the secured guarantee given by KRI to Speedy for the debts owed by Edge and AS. KRI’s monitor, KSV Kofman Inc. (the “Monitor”) disallowed the claim. The Monitor later brought a motion for an order declaring that Speedy’s $2,323,638.54 claim be disallowed on the basis that the secured guarantee was a transfer at undervalue under s. 96 of the Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3 (the “BIA”) and a fraudulent conveyance under s. 2 of the Fraudulent Conveyances Act, R.S.O. 1990, c. F.29 (the “FCA”). The motion judge dismissed the Monitor’s motion and the Monitor subsequently appealed, with leave. The Monitor challenged the motion judge’s finding that the secured guarantee was between arm’s length parties. Specifically, the Monitor argued that the motion judge erred in law in focussing on the relationship between KRI and Speedy, rather than the relationships among KRI, Edge and AS. The Monitor further contended that the motion judge made a reversible error in concluding that the fraudulent intent necessary under s. 96(1)(a) of the BIA and s. 2 of the FCA was not established.

ISSUE:

(1) Did the motion judge err in focussing on the relationship between Speedy and KRI rather than between Edge and AS (as beneficiaries of the secured guarantee) and KRI?

(2) Did the motion judge err by failing to consider the record as a whole, including all of the potential badges of fraud, when he refused to find fraudulent intent?

(3) Did the motion judge err in misapplying the Rule in Browne v. Dunn?

(4) Did the motion judge err in his award of costs of the motion against the Monitor?

HOLDING:

Appeal dismissed.

REASONING:

(1) No. The motion judge properly considered the relationship between KRI and Speedy, rather than the relationship between KRI, Edge and AS, in determining whether the impugned transfer was to a non-arm’s length party. The issue, under a proper construction of s. 96(1)(b) of the BIA, is whether the transferee, Speedy, was dealing at arm’s length with KRI, the transferor, in relation to the impugned transfer, which was the secured guarantee. The court held that while Edge and AS were parties to, and beneficiaries of, the transaction that provided for the secured guarantee, the transfer sought to be impugned by the Monitor was KRI’s secured guarantee in favour of Speedy. In other words, the overall agreement pursuant to which the guarantee and security were provided to Speedy did not make the entirety of the DEA the “transfer” for the purpose of s. 96.

(2) No. The motion judge made no error in refusing to find fraudulent intent. In making its determination, the court noted that while badges of fraud are indicia of fraudulent intent, their presence does not mandate an inference of fraud to be drawn. Accordingly, the court held that the failure to consider a particular badge of fraud was not, in itself, a legal error justifying review on a correctness standard. The real issue on appeal was thus whether the trial judge failed to take into account the entirety of the factual situation and made conclusions of fact, or mixed fact and law, that were not supported by the record.

Ultimately, the court held that the motion judge’s finding that the Monitor had not established the debtor’s fraudulent intent was available on the record and did not ignore any relevant evidence. The burden of proving fraudulent intent rests with the party seeking to avoid the transfer. Accordingly, the relevant intent was that of KRI in relation to the transfer with Speedy. The overall context was the impending Israeli bond financing. There was uncontroverted evidence that Speedy’s lien had to be discharged in order to facilitate the financing and that the lawyers for Speedy and Urbancorp group were seeking alternative security for Speedy’s debts. This was accommodated by the secured guarantee and mortgages on KRI’s completed units and parking spaces. While the bond financing was expected to be available to discharge debts of the Urbancorp group, the funding was instead used for other purposes, and ultimately the Urbancorp group defaulted on its obligations to the Israeli bondholders and others.

(3) No. The court held that no such error was made. In any event, the court found that the main issue with the Monitor’s argument that the motion judge misapplied the Rule in Browne v Dunn was its apparent lack of relevance to any issue which continued to be in dispute on appeal.

(4) No. The motion judge’s costs award against the Monitor, on behalf of the debtor, and not in its personal capacity, was a proper exercise of discretion and revealed no reversible error. The court held that there was nothing unreasonable in the motion judge’s decision that costs of the Monitor’s unsuccessful attempt to disallow Speedy’s claim should follow the event and be borne by the debtor’s estate, since, if the disallowance had been successful, that would have benefitted KRI’s creditors. With respect to the quantum of the award, the court held that the amount in dispute was only one of a variety of factors relevant to the determination of costs. In the circumstances, the quantum reflected the legal work that was required, which was the same, irrespective of the amount in dispute. Moreover, there was nothing to suggest that the agreed amount of $25,000 was other than proportional to the work and reasonable in all of the circumstances.

The court awarded costs of the appeal to Speedy, including the motion for leave to appeal, fixed at the inclusive amount of $15,000 to be paid by the Monitor on behalf of the debtor and not in its personal capacity. No costs were awarded in favour or against the Israeli Functionary.


SHORT CIVIL DECISIONS

Lee v. Lalu Canada Inc., 2019 ONCA 750

[Huscroft, Paciocco and Nordheimer JJ.A.]

Counsel:

John O’Sullivan, for the appellant
Patricia Virc and M. Michael Title, for the respondents

Keywords: Civil Procedure, Appeals, Jurisdiction, Orders, Final or Interlocutory, Sun Life Assurance Co. v. York Ridge Developments Ltd. (1998), 116 A.O.C. 103, Cytrynbaum v. Look Communications Inc., 2013 ONCA 455

Makovskis v. McKenney, 2019 ONCA 755

[Juriansz, Benotto and Miller JJ.A.]

Counsel:

Michael Stangarone and Stephen Kirby, for the appellant
Jonathan Miller, for the respondent

Keywords: Family Law, Matrimonial Home, Civil Procedure, Orders, Enforcement, Writs of Seizure and Sale, Family Law Act, s. 21

Tsui-Wong v. Xiao, 2019 ONCA 756

[Juriansz, Benotto and Miller JJ.A.]

Counsel:

Allan Rouben, for the appellants
William Murray and Annabelle Wai Ying Lui, for the respondent

Keywords: Civil Procedure, Costs, Appeals, Fraudulent Conveyances, Fraudulent Conveyances Act, R.S.O. c. F.29, Assignments and Preferences Act, R.S.O. 1990, c. A.33

Broutzas v. Rouge Valley Health System, 2019 ONCA 751

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

Counsel:

Michael A. Crystal and Norman Mizobuchi, for the plaintiffs, EB and AK
Evan Kopiak, for the defendants, C.S.T. Consultants Inc.
Nicole Henderson, for the defendants, Knowledge First Financial Inc.
Daniel Girlando, for the defendants, Scarborough Health Network

Keywords: Appeal Book Endorsement, Class Proceedings Act, 1992, S.O. 1992, c. 6, s. 30

Stephens v. Stephens, 2019 ONCA 752

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

Counsel:

KMS, self-represented
WRS, self-represented

Keywords: Appeal Book Endorsement, Civil Procedure, Vexatious Litigants, Orders, Setting Aside, Procedural Fairness, Courts of Justice Act, R.S.O. 1990, c. C. 43, s. 140


CRIMINAL DECISIONS

R. v. Johannes, 2019 ONCA 696

[Juriansz, Pepall and Roberts JJ.A.]

Counsel:

Lisa Jørgensen, for the appellant
Kerry Benzakein, for the respondent

Keywords: Criminal Law, Drug Offences, Certiorari, R. v. Kamermans, [2016] O.J. No. 685 (C.A.)

R. v. Cumor, 2019 ONCA 747

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

Counsel:

Jeffery Couse, for the appellant
Tracy Kozlowski, for the respondent

Keywords: Criminal Law, Conspiracy to Traffic Cocaine, Conspiracy to Traffic Firearms, Possession of a Firearm, Possession of Proceeds of Crime, Procedural Fairness, Jury Selection, Jury Instructions, Jury Charge, Criminal Code, ss. 591(3)(a), 640(2), 640(2.1), 640(2.2), 686(1)(b)(iv), R. v. Jaser, 2014 ONSC 7528, rev’d 2019 ONCA 672, R. v. Grant, 2016 ONCA 639, R. v. Husbands, 2017 ONCA 607, leave to appeal refused, [2017] S.C.C.A. No. 364, R. v. Esseghaier, 2019 ONCA 672, R. v. Riley, 2017 ONCA 650, leave to appeal refused, [2018] S.C.C.A. No. 216, R. v. Murray, 2017 ONCA 393, R. v. Noureddine, 2015 ONCA 770, R. v. Swite, 2011 BCCA 54, R. v. Evans, 2019 ONCA 715, R. v. A.C., 2018 ONCA 333, R. v. Figliola, 2011 ONCA 457, R. v. Last, 2009 SCC 45, R. v. Puddicombe, 2013 ONCA 506, leave to appeal refused, [2013] S.C.C.A. No 496, R. v. Hamilton, 2011 ONCA 399, R. v. Hebert, [1996] 2 S.C.R. 272, R. v. Calnen, 2019 SCC 6, R. v. Rodgerson, 2015 SCC 38, R. v. R.V., 2018 ONCA 547, rev’d on other grounds, 2019 SCC 41

R. v. Hakimi, 2019 ONCA 749

[Juriansz, Pepall and Roberts JJ.A.]

Counsel:

Stephanie DiGiuseppe, for the appellant
Jill Cameron and Katie Doherty, for the respondent

Keywords: Criminal Law, Aggravated Assault, Firearm Offences, Evidence, Admissibility, Identification, Prior Statements, Video-recorded Statements, Jury Instructions, Sentencing, R. v. Bradshaw, 2017 SCC 35, R. v. Miapanoose (1996), 30 O.R. (3d) 419 (C.A.)

R. v. Curry, 2019 ONCA 754

[Huscroft, Paciocco and Nordheimer JJ.A.]

Counsel:

Paolo Giancaterino and Marco Sciarra, for the appellant
Sean Horgan, for the respondent

Keywords: Criminal Law, Dangerous Driving Causing Death, Dangerous Driving Causing Bodily Harm, Impaired Driving Causing Death, Impaired Driving Causing Bodily Harm, Blood Alcohol Over Legal Limit Causing Accident Resulting in Death, Blood Alcohol Over Legal Limit Causing Accident Resulting in Bodily Harm

R. v. O’Leary, 2019 ONCA 758

[Juriansz, Pepall and Roberts JJ.A.]

Counsel:

Robert C. Sheppard, for the appellant TO
Lance Beechener, for the appellant MD
Scott O’Neill, for the appellant CG
Ken Lockhart, for the respondent

Keywords: Criminal Law, Robbery, Use of Imitation Firearm, Conspiracy to Commit Robbery, Evidence, Admissibility, Prior Statements, Video-recorded Statements, Mental Illness, Vetrovec Warning, Fresh Evidence, Sentencing, R. v. Vetrovec, [1982] 1 S.C.R. 811

R. v. Beer (Publication Ban), 2019 ONCA 763

[Juriansz, Pepall and Roberts JJ.A.]

Counsel:

Jennifer Dagsvik, for the appellant
Leslie Paine, for the respondent

Keywords: Publication Ban, Criminal Law, Sexual Assault, Evidence, Credibility, Consent, Sentencing


ONTARIO REVIEW BOARD

Davies (Re), 2019 ONCA 738

[Watt, Tulloch and Lauwers JJ.A.]

Counsel:

Anita Szigeti, for the appellant, JD
Gavin MacDonald, for the respondent Her Majesty the Queen

Keywords: Ontario Review Board, Not Criminally Responsible, Assault with a Weapon, Aggravated Assault, Threat to Public Safety, Conditional Discharge, Detention Orders, Criminal Code, ss. 672.54, 672.92, 672.93, R v Winko, [1999] 2 SCR 625, Esgin (Re), 2019 ONCA 155, Mazzei v British Columbia (Director of Adult Forensic Psychiatric Services), 2006 SCC 7, Campbell (Re), 2018 ONCA 140, R v Owen, 2003 SCC 33, R v Conway, 2010 SCC 22, Boucher (Re), 2015 ONCA 135, Tolias (Re), 2018 ONCA 2015, Collins (Re), 2018 ONCA 563, Centre for Addiction and Mental Health v Young, 2011 ONCA 432, Valdez (Re), 2018 ONCA 657

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…

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, construction, environmental contamination, product liability, debtor-creditor, insolvency and other business litigation. He also handles professional discipline and professional negligence matters, as well as complex estates and matrimonial litigation. In addition, John 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.