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Good afternoon.

There were only three substantive decisions released by the Court of Appeal this week. In Paulpillai Estate v. Yusuf, the Court reviewed in detail the factors to be considered in an analysis of whether an order is final or interlocutory for the purposes of determining the proper appeal route.

Other topics covered this week included bank negligence, and building code violations.

Wishing everyone a pleasant weekend.

John Polyzogopoulos

Blaney McMurtry LLP

416.593.2953 Email


Table of Contents

Civil Decisions

Paulpillai Estate v. Yusuf, 2020 ONCA 655

Keywords: Civil Procedure, Appeals, Jurisdiction, Final or Interlocutory, Corporations, Remedies, Oppression, Receiverships, Interim Release of Funds, Injunctions, Adding Parties, Sealing Orders, Arbitration, Applications, Actions, Courts of Justice Act, ss. 6(1)(b), ss. (19(1)(b), ss. 101(1), Arbitration Act, ss. 7(1) and ss. 7(6), Grand River Enterprises v. Burnham (2005), 197 OAC 168 (CA), Drywall Acoustic Lathing Insulation Local 675 Pension Fund v. SNC-Lavalin Group Inc., 2020 ONCA 375, Prescott & Russell (United Counties) v. David S. Laflamme Construction Inc., 2018 ONCA 495, Laurentian Plaza Corp. v. Martin (1992), 7 OR (3d) 111 (CA), Ontario Medical Assn. v. Miller (1976), 14 OR (2d) 468 (CA), Illidge (Trustee of) v. St. James Securities Inc. (2002), 60 OR (3d) 155 (CA), Amphenol Canada Corp. v. Sundaram, 2019 ONCA 932, Susan J. Model & Talent Management Inc. v. IMG Models Inc., 2006 CanLII 2882 (Ont. CA), Fram Elgin Mills 90 Inc. v. Romandale Farms Limited, 2016 ONCA 404

Whitby (Town) v. G & G 878996 LM Ltd., 2020 ONCA 654

Keywords: Municipal Law, Building Code, Civil Procedure, Appeals, New Issue on Appeal, Remedies, Set-off, Building Code Act, 1992, S.O. 1992, c. 23, s 15.10, Kaiman v. Graham, 2009 ONCA 77

Foodinvest Limited v. Royal Bank of Canada, 2020 ONCA 665

Keywords: Torts, Negligence, Duty of Care, Standard of Care, Banking, Fraud, Civil Procedure, Summary Judgment, Deloitte & Touche v. Livent Inc. (Receiver of), [2017] 2 SCR 855

Short Civil Decisions

Ballanger v. Ballanger, 2020 ONCA 663

Keywords: Costs

Samad v. Rasool, 2020 ONCA 656

Keywords: Civil Procedure, Appeals, Extension of Time, Orders, Setting Aside

Pearl Hospitality Inc. v. Ceballos, 2020 ONCA 672

Keywords: Contracts, Real Property, Mortgages, Civil Procedure, Torts, Fraudulent Misrepresentation

Levin v. Levin, 2020 ONCA 675

Keywords: Family Law, Costs

Old Navy (Canada) Inc. v. The Eglinton Town Centre Inc., 2020 ONCA 679

Keywords: Consent Dismissal


CIVIL DECISIONS

Paulpillai Estate v. Yusuf, 2020 ONCA 655

[Doherty, Hoy and Jamal JJ.A.]

Counsel:

O.G. Barnwell, for the appellants

E.G. Upenieks and A.H. Kwok, for the respondents

Keywords: Civil Procedure, Appeals, Jurisdiction, Final or Interlocutory, Corporations, Remedies, Oppression, Receiverships, Interim Release of Funds, Injunctions, Adding Parties, Sealing Orders, Arbitration, Applications, Actions, Courts of Justice Act, ss. 6(1)(b), ss. (19(1)(b), ss. 101(1), Arbitration Act, ss. 7(1) and ss. 7(6), Grand River Enterprises v. Burnham (2005), 197 OAC 168 (CA), Drywall Acoustic Lathing Insulation Local 675 Pension Fund v. SNC-Lavalin Group Inc., 2020 ONCA 375, Prescott & Russell (United Counties) v. David S. Laflamme Construction Inc., 2018 ONCA 495, Laurentian Plaza Corp. v. Martin (1992), 7 OR (3d) 111 (CA), Ontario Medical Assn. v. Miller (1976), 14 OR (2d) 468 (CA), Illidge (Trustee of) v. St. James Securities Inc. (2002), 60 OR (3d) 155 (CA), Amphenol Canada Corp. v. Sundaram, 2019 ONCA 932, Susan J. Model & Talent Management Inc. v. IMG Models Inc., 2006 CanLII 2882 (Ont. CA), Fram Elgin Mills 90 Inc. v. Romandale Farms Limited, 2016 ONCA 404

facts:

The respondent in this case is the estate of a deceased. The deceased and the appellant operated two universities together in the Caribbean. While several corporate structures and partnerships were interposed, their relationship was ultimately governed by a partnership agreement in Ontario. When the deceased passed away, the appellant suggested to the respondent that they alter the relationship and each take responsibility for one of the schools and no longer run them as affiliated schools. The respondent agreed to this. However, the respondent alleged that the appellant failed to provide proper financial disclosure to allow the respondent to make a proper choice as to which school to assume ownership for. Further, it was alleged the appellant began competing with the school owned by the respondent, poaching its staff and that the appellant also failed to account for partnership funds owed to the deceased’s estate arising after the deceased’s death.

As a result, the respondents commenced an application, seeking a declaration and damages for corporate oppression, a declaration and damages for breach of the partnership agreement and an accounting and tracing of partnership funds since the death of the deceased, among other relief. The appellant agreed to all the injunctive relief sought at the first appearance and so a consent order was granted. Thereafter, the respondent had reason to believe the appellant was breaching the consent order and so brought the application back before the court.

The motion judge issued the order that gives rise to this appeal, which order: i) appointed BDO Canada Limited (“BDO”) as an investigative monitor of the schools; ii) released funds on an interim basis to the appellant for the operation of their school, as an advance of any sum that might be found to be payable to them; iii) enjoined the appellant on an interim basis from competing unfairly with the respondent’s school or recruiting its students or personnel; iv) converted the application to an action; v) added parties to the action; and vi) declined to seal the entire court file.

The respondent brought a motion to quash the appeal as being in the wrong court. The appellant sought a stay of the order pending appeal.

issues: 

(1) Was the order under appeal final or interlocutory, such that an appeal lay to the Divisional Court, with leave?

(2) Should the order be stayed?

holding: 

Motion to quash granted. Motion to stay dismissed.

reasoning: 

(1) Was the order under appeal final or interlocutory, such that an appeal lay to the Divisional Court, with leave?

The order was interlocutory. An appeal from an interlocutory order lies to the Divisional Court. The Court of Appeal reviewed the main principles to be considered when assessing whether an order is interlocutory: i) an appeal lies from the court’s order, not from the reasons given for making the order; ii) an interlocutory order “does not determine the real matter in dispute between the parties — the very subject matter of the litigation — or any substantive right. Even though the order determines the question raised by the motion, it is interlocutory if these substantive matters remain undecided; iii) in determining whether an order is final or interlocutory, one must examine the terms of the order, the motion judge’s reasons for the order, the nature of the proceedings giving rise to the order, and other contextual factors that may inform the nature of the order; and iv) the question of access to appellate review must be decided on the basis of the legal nature of the order and not on a case by case basis depending on the application of the order to the facts of a particular case … in other words, the characterization of the order depends upon its legal nature, not its practical effect.

The Court of Appeal then considered each element of the order under appeal to determine whether the order was interlocutory.

(i) Appointment of BDO
The motion judge’s reasons noted the court had “authority to appoint a receiver and manager by an interlocutory order where it appears to be just or convenient to do so: Courts of Justice Act, s. 101”. BDO was appointed to monitor the schools and ensure the respondents’ ability to recover was not prejudiced. It is well established before the Court of Appeal that a receiver appointed under s. 101(1) is an interlocutory order, and the court held in this case that appointing BDO an investigative monitor was a parallel decision.

(ii) Release of Funds to the respondent
An interim release of funds to one party, on motion, that settles no elements of the lis between the parties is an interlocutory order. In this case, the order itself referred to it as an advance of money that may be owing. If the application is unsuccessful, the money will have to be repaid and as such, it is not determinative of the parties’ rights.

(iii) Interim Injunction
An interim or interlocutory injunction is interlocutory for purposes of the appeal route, because its legal nature does not finally determine the essence of the litigation before the court, even if its practical effect may be to do so. As a result, the court concluded the injunction was interlocutory.

(iv) Conversion of the Application into an Action
The Court held that an order converting an application into an action is interlocutory. Such an order simply converts the application into an action that will proceed to trial. The matter was started in the Superior Court of Justice and remains there.

(v) Addition of Parties
The act of adding parties to an action or an application does not affect or finally determine the substantive rights of any of the parties. The litigation continues and the rights of the parties are decided in a further step in the action/application. Thus, an order adding parties is interlocutory.

(vi) Refusing to Seal the Court File
In refusing to seal the court file, the motion judge noted that the decision could be revisited if either party could present evidence to support it. This illustrates that it was not finally determinative, nor did it relate to the real matter in dispute. It was a collateral consideration as to whether the documents would be public. This was sufficient for the Court to find this aspect of the order as being interlocutory as well.

(vii) Refusal to Refer the Dispute to Arbitration
The partnership agreement stated that all disputes would be referred to arbitration and the parties may apply to a court for injunctive relief. The appellants suggested that by failing to order the matter into arbitration, the motion judge finally determined the forum for dispute resolution and deprived the appellants of their contractual right to arbitrate.

The Court dismissed this submission, largely because there was no motion before the motion judge to refer the dispute to arbitration. Further, the appellants did not make any attempt to stay the court proceedings in favour of arbitration, rather, they took significant steps in the court proceedings and thus waived their right to arbitrate.

Ultimately, the Court found that all aspects of the order were interlocutory, therefore it had no jurisdiction to hear the appeal. The appeal was therefore quashed.

(2) Should the order be stayed?

No. Since the Court of Appeal did not have jurisdiction for the appeal, the motion to stay the order under appeal was dismissed.


Whitby (Town) v. G & G 878996 LM Ltd., 2020 ONCA 654

[Hourigan, Trotter and Jamal JJ.A.]

Counsel:

J.A. Annen, for the appellant

R.A. Biggart and N. Sheikh, for the respondent

Keywords: Municipal Law, Building Code, Civil Procedure, Appeals, New Issue on Appeal, Remedies, Set-off, Building Code Act, 1992, S.O. 1992, c. 23, s 15.10, Kaiman v. Graham, 2009 ONCA 77

facts:

The appellant, G&G 878996 LM Ltd. (“G&G”), owned a multi-story, mixed-use commercial/residential building. A fire occurred at an adjacent building which resulted in it being demolished, except for the wall adjoining G&G’s property. This adjoining wall was eventually removed with the approval of the respondent, the Corporation of the Town of Whitby (“Whitby”).

Whitby’s Chief Building Official (“CBO”) later determined that the G&G owned building’s north wall, which had previously abutted the adjacent building that was demolished, constituted an immediate danger to occupants and the public-at-large. Pursuant to her authority under s.15.10 of the Building Code Act, 1992, (the “Act”), the CBO issued two emergency orders to eliminate the immediate danger posed by the exposed wall. Whitby then spent $335,089.86 to protect the public and effect repairs to terminate the danger. Following the issuing of an emergency order under s. 15.10 of the Act, a CBO must apply to a judge of the Superior Court to confirm the order. In the case at bar, the application judge confirmed the emergency orders and ordered that Whitby could recover from G&G its full costs in taking steps to terminate the immediate danger, as well as its costs of the application.

issues: 

(1) Did the application judge err in failing to consider whether the doctrine of equitable set-off applied in determining whether the amounts spent by Whitby were recoverable from G&G?

(2) Did the application judge err by approaching the case on the basis that it was analogous to an environmental damage claim?

holding: 

Appeal dismissed.

reasoning: 

(1) Did the application judge err in failing to consider whether the doctrine of equitable set-off applied in determining whether the amounts spent by Whitby were recoverable from G&G?

No. At the hearing of the application, G&G did not argue that it was entitled to an equitable set-off. Instead of arguing equitable set-off, it submitted that “[Whitby] should be estopped from collecting any of the funds expended on measures determining this perceived danger at that time.” The Court will generally not entertain entirely new issues on appeal because it is unfair to force a party on an appeal to respond when they might have adduced evidence below had they known that the matter would be an issue on appeal.

(2) Did the application judge err by approaching the case on the basis that it was analogous to an environmental damage claim?

No. The Court rejected the argument that the application judge incorrectly analogized the case at bar to an environmental damage claim. The comments of the application judge in that regard were part of a dialogue with counsel and not part of her reasons. Regarding the evidentiary record, no complaint was made by G&G on the return of the application about the state of the record. In any event, the Court was not satisfied that the record was insufficient for the application judge to make her order.

Foodinvest Limited v. Royal Bank of Canada, 2020 ONCA 665

[Doherty, Paciocco and Coroza JJ.A.]

Counsel:

G.K. Bastien, for the appellant

C. Francis, for the respondent

Keywords: Torts, Negligence, Duty of Care, Standard of Care, Banking, Fraud, Civil Procedure, Summary Judgment, Deloitte & Touche v. Livent Inc. (Receiver of), [2017] 2 SCR 855

facts:

The appellant (“Foodinvest”) contracted with the respondent (“RBC”) for the use of a self-service transfer facility (“RBC Express”) provided by RBC. That service allowed customers to personally transfer and receive funds from other financial institutions. Foodinvest used RBC Express to transfer funds to accounts in a Polish bank. Foodinvest subsequently claimed the beneficiary of the transferred funds had misappropriated those funds and defrauded Foodinvest. RBC received an email from the Polish bank to which the funds were being transferred, indicating the Polish bank suspected fraud in relation transactions in which Foodinvest had used RBC Express to transfer funds to the Polish bank. RBC did not pass this information on to Foodinvest. Foodinvest sued, maintaining RBC was under a duty to do so
The motion judge granted summary judgment for RBC and dismissed the claim. In dismissing the claim, the motion judge found RBC’s duty of care did not extend to an obligation to pass on the information provided by the Polish bank. Second, the motion judge found, even if a duty of care existed, there was no expert evidence in respect of the standard of care owed by RBC in the circumstances.

issues: 

(1) Did the motion judge err in making a determination on a summary judgment motion of novel legal issues?

(2) Did the motion judge err in holding that RBC’s duty of care did not extend to the requirement that RBC pass on the information it received from the Polish bank?

holding: 

Appeal dismissed.

reasoning: 

(1) Did the motion judge err in making a determination on a summary judgment motion of novel legal issues?

No. The argument on appeal that the issues were novel and not amenable to a motion for summary judgment was not made before the motion judge. In any event, the claim was not novel. The nature and extent of RBC’s duty of care fell to be determined under the principles articulated in Deloitte & Touche v. Livent Inc. (Receiver of), [2017] 2 SCR 855. In addition, the facts did not rise to a level of novelty or complexity unamenable to the summary judgment process.

(2) Did the motion judge err in holding that RBC’s duty of care did not extend to the requirement that RBC pass on the information it received from the Polish bank?

No. The scope of RBC’s duty of care to Foodinvest depended on the nature of the service it provided and the terms of the contractual relationship governing that service. The relevant agreement set out in exhaustive terms the nature and scope of RBC’s potential liability in respect of the services it offered to Foodinvest. RBC’s duty of care related specifically to the execution of the transfers made using the service provided by RBC. RBC’s duty of care extended to taking reasonable steps to ensure the transfers were properly authorized and properly carried out in accordance with the instructions provided. That duty did not require RBC to concern itself with the specifics or bona fides of the underlying transactions giving rise to the transfers. If Foodinvest was cheated, its loss flows not from any failure of the service provided by RBC, but from the dishonesty of the entities Foodinvest chose to do business with.


SHORT CIVIL DECISIONS

Ballanger v. Ballanger, 2020 ONCA 663

[Juriansz, Hourigan and Thorburn JJ.A.]

Counsel:

S. Beddoe and J. Robinson, for the appellant

G.S. Joseph and A.M. Mastervick, for the respondent, M.B.

J.J. Neal, for the respondent, K.H.

Keywords: Costs

Samad v. Rasool, 2020 ONCA 656

[Hourigan, Trotter and Jamal JJ.A.]

Counsel:

S.S., self-represented

A. Lee, for the respondent

Keywords: Civil Procedure, Appeals, Extension of Time, Orders, Setting Aside

Pearl Hospitality Inc. v. Ceballos, 2020 ONCA 672

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

Counsel:

D.C., acting in person

I.S. Arora and J. Chahal, for the respondent

Keywords: Contracts, Real Property, Mortgages, Civil Procedure, Torts, Fraudulent Misrepresentation

Levin v. Levin, 2020 ONCA 675

[Watt, Trotter and Zarnett JJ.A.]

Counsel:

P.I. Waldmann, for the appellant

R. Kniznik, for the respondent

Keywords: Family Law, Costs

Old Navy (Canada) Inc. v. The Eglinton Town Centre Inc., 2020 ONCA 679

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

Counsel:

J.F. Lancaster, for the appellants

C. Francis, for the respondent

Keywords: Consent Dismissal


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.