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Good afternoon.

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

Topics covered included inter vivos gifts in an estate matter, repudiation of an agreement for purchase and sale of land, enforcement of a settlement offer in a real estate transaction, and the addition of family law claims in an MVA action after the expiry of the limitation period.

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Please mark down April 27, 2021, from 5:30-7:45pm in your calendars for our fifth annual “Top Appeals” CLE, which will take place via Zoom. Justice Benjamin Zarnett will be co-chairing the event with myself and Chloe Snider of Dentons. Following is our excellent slate of decisions and speakers:

2020 Update from the Bench

The Honourable Benjamin Zarnett, Court of Appeal for Ontario

Panel 1 – Advocacy Practice Tips from the Court

Girao v. Cunningham, 2020 ONCA 260

OZ Merchandising Inc. v. Canadian Professional Soccer League Inc., 2020 ONCA 532

Welton v. United Lands Corporation Limited, 2020 ONCA 322

Jordan Goldblatt, Adair Goldblatt Bieber LLP

Sara Erskine, Weintraub Erskine Huang LLP

Panel 2 – Negligently Designed Financial Products – A New Age in Product Liability?

Wright v. Horizons ETFS Management (Canada) Inc., 2020 ONCA 337

Seumas Woods, Blake, Cassels & Graydon LLP

Alistair Crawley, Crawley MacKewn Brush LLP

Elizabeth Bowker, Stieber Berlach LLP

Panel 3 – Developments in Insolvency Law – Priority of Construction Trust Claims and Landlord Claims in Bankruptcy

Urbancorp Cumberland 2 GP Inc. (Re), 2020 ONCA 197

7636156 Canada Inc. (Re), 2020 ONCA 681

Ken Kraft, Dentons LLP

Kevin Sherkin, Miller Thomson LLP

D.J. Miller, Thornton Grout Finnigan LLP

In the meantime, please register for the program by visiting the OBA’s website.

Wishing everyone an enjoyable weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Table of Contents

Civil Decisions

Hannivan v. Wasi, 2021 ONCA 187

Keywords: Contracts, Real Property, Agreements of Purchase and Sale of Land, Essential Terms, Repudiation,  Domowicz v. Orsa Investments Ltd. (1993), 36 R.P.R. (2d) 174 (Ont. Gen. Div.)

Hayward v. Hayward, 2021 ONCA 175

Keywords: Wills and Estates, Inter Vivos Gifts, Civil Procedure, Procedural and Natural Justice, Pleadings, New Issues, Substantial Indemnity Costs, Limitations Act, 2002, S.O. 2002, c. 24, Rodaro v. Royal Bank of Canada (2002), 59 O.R. (3d) 74, Davies v. Clarington (Municipality), 2009 ONCA 722

Magnotta v. Yu, 2021 ONCA 185

Keywords: Contracts, Real Property, Civil Procedure, Settlements, Offers to Settle, Enforcement, Rules of Civil Procedure, Rule 49, York North Condominium Corp. No. 5 v. Van Horne Clipper Properties Ltd. (1989), 70 O.R. (2d) 317 (C.A.), Milios v. Zagas (1998), 38 O.R. (3d) 218 (C.A.), Srebot v. Srebot Farms Ltd., 2013 ONCA 84

Malik v. Nikbakht, 2021 ONCA 176

Keywords: Torts, Negligence, MVA, Family Law Claims, Civil Procedure, Limitation Periods, Family Law Act, R.S.O. 1990, c. F.3, s. 61, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B., Bazkur v. Coore, 2012 ONSC 3468 (Div. Ct.), Camarata v. Morgan, 2009 ONCA 38, Macartney v. Warner (2000), 46 O.R. (3d) 641 (Ont. CA), Ridel v. Cassin, 2014 ONCA 763

Short Civil Decisions

Lad v. Marcos, 2021 ONCA 183

Keywords: Civil Procedure, Appeals, Jurisdiction, Orders, Final or Interlocutory, Striking Pleadings, No Reasonable Cause of Action, Substantial Indemnity Costs, Rules of Civil Procedure, Rule 21.01(1)(a), Courts of Justice Act, RSO 1990, c. C.43, s. 19(1)(a), Paulpillai Estate v. Yusuf, 2020 ONCA 655, Atlas Holdings v. Vratsidas, 2012 ONSC 1375, Ball v. Donais (1993), 13 OR (3d) 322 (CA)

T.A.W. v. J.C.L., 2021 ONCA 192

Keywords: Family Law, Torts, Fraudulent Misrepresentation, Negligent Infliction of Mental Distress, Unjust Enrichment, Civil Procedure, Transfer to Family Court, Striking Pleadings, No Reasonable Cause of Action, Substantial Indemnity Costs, Rules of Civil Procedure, Rule 21.01(1)(b), Hamilton v. Open Window Bakery Ltd., 2004 SCC 9


CIVIL DECISIONS

Hannivan v. Wasi, 2021 ONCA 187

[Feldman, Paciocco and Coroza JJ.A.]

Counsel:

D. Bhatia, for the appellant

M.A. De Sanctis, for the respondents

Keywords: Contracts, Real Property, Agreements of Purchase and Sale of Land, Essential Terms, Repudiation,  Domowicz v. Orsa Investments Ltd. (1993), 36 R.P.R. (2d) 174 (Ont. Gen. Div.)

facts:

In 2017, the parties executed an agreement of purchase and sale (the “APS”) whereby the appellant would purchase the respondent’s home. The APS was to close in mid-august 2017 and requisitions were to be submitted at the beginning of August. The appellant never submitted any requisitions. On the night before closing, the appellant’s lawyer sent a correspondence to the vendor with various concerns, including most notably, that the respondent had failed to comply with a term of the APS concerning a property survey, and as a result, the APS was null and void and the respondent should immediately return the deposit.

The transaction never closed and the respondent’s subsequently sold the house to a different buyer for less than the APS price. The respondent brought an action for the difference in purchase price and the appellant counterclaimed for return of the deposit paid. Summary judgment was granted in favour of the respondent on both the primary claim and counterclaim as the appellant wrongfully repudiated the APS. The respondent had delivered a ‘barebones’ survey and while it may have been insufficient, it was not essential to the transaction so as to entitle the appellant to repudiate the APS.

issues:

(1) Did the motion judge err in granting the respondent’s motion for summary judgment?

holding:

Appeal dismissed.

reasoning:

(1) No. The appellant raised several arguments which he suggested amounted to errors made by the motion judge, all of which were rejected by the Court.

The appellant first argued that the motion judge did not consider the respondent’s failure to plead or argue compliance with the APS. However, viewing the pleadings as a whole, there were no deficiencies.

Second, the appellant argued that the motion judge failed to consider the respondent’s admission that the respondent was aware the appellant intended to undertake major renovations, making the survey important. The Court rejected this argument. While the motion judge did not mention the admission in his reasons, he had clearly considered the admission based on his reasoning. Further, whether the respondent knew of the renovations or not did not impact the appellant’s ability to close the transaction or his entitlement to repudiate.

Third, the appellant submitted the motion judge did not deal with the survey term in his decision. This submission had no merit, as the motion judge’s reasons were quite concise and clearly considered the term.

The appellant then submitted that the motion judge failed to consider authorities put forward by the appellant, most importantly, Domowicz v. Orsa Investments Ltd. (1993), 36 R.P.R. (2d) 174 (Ont. Gen. Div.), wherein a vendor’s late delivery of a survey precluded the purchaser from obtaining financing. The purchaser should have been accommodated by an extension to closing, but was not and so the purchaser was successful. The motion judge considered this case, but distinguished it because even though the respondent did not strictly comply with the APS, the non-compliance did not impact the purchaser’s financing or ability to conclude the APS in any other way.

Finally, the appellant submitted that the motion judge misconstrued evidence and failed to properly consider its submissions. The Court rejected this argument as well, as the motion judge carefully reviewed the evidence and clearly focused on the alleged non-compliance and whether it was so essential to the bargain so as to allow the appellant to repudiate the APS.


Hayward v. Hayward, 2021 ONCA 175

[Lauwers, Trotter and Zarnett JJ.A.]

Counsel:

R. J. De Toni, for the appellants

R. A. Lewis, for the respondents

Keywords: Wills and Estates, Inter Vivos Gifts, Civil Procedure, Procedural and Natural Justice, Pleadings, New Issues, Substantial Indemnity Costs, Limitations Act, 2002, S.O. 2002, c. 24, Rodaro v. Royal Bank of Canada (2002), 59 O.R. (3d) 74, Davies v. Clarington (Municipality), 2009 ONCA 722

facts:

The appeal concerned the estate of J.H. She was survived by her former husband, A.H., and their five children. All five children were beneficiaries. One child was the estate trustee (the “Trustee”). A. H. was not a beneficiary. Three children supported their father’s claim to various estate assets and funds. A.H. appealed the disposition of his claims to repayment of a loan he made to J.H. with which she bought a Chevrolet Malibu (the “Malibu”) and to ownership of a Montana tractor (the “Tractor”). A.H., joined by three of his children, also sought leave to appeal the costs award.

issues:

(1) Did the trial judge err in finding the funds A.H. paid for the Malibu were a gift?

(2) Did the trial judge err in failing to find that the repayment of the loan on the Tractor was time-barred under the Limitations Act, 2002?

(3) Did the trial judge err in awarding substantial indemnity costs against the appellants?

holding:

Appeal allowed, in part.

reasoning:

(1) Did the trial judge err in finding the funds A.H. paid for the Malibu were a gift?

Yes. A.H. claimed that he had provided a loan with which the Malibu was purchased. The trial judge found that A.H. had paid for the Malibu, but did so as a gift. However, the estate had not argued that A.H.’s money was a gift. It was not open to the trial judge to find that the funds A.H. paid were a gift and not a loan. A trial judge’s reliance on a ground that was not argued is fundamentally unfair and potentially unreliable because it was not tested through the adversarial process. There are tests for determining when funds are a gift, but the trial judge did not apply or allow the parties to address those tests before making a determination.

(2) Did the trial judge err in failing to find that the repayment of the loan on the Tractor was time-barred under the Limitations Act, 2002?

No. A.H. argued that, since he paid the down payment on the Tractor, and the bill of sale was in his name, he owned it. The Trustee argued that, since she paid the balance of the Tractor, and A.H. never paid her back, she owned it. The trial judge found that, because there was no evidence that A.H. ever repaid the Trustee, A.H. did not own it. The appellant argued that the trial judge erred in failing to find that repayment of the loan was time-barred under the Limitations Act, 2002. The Court held that, since counsel did not raise this defence, the trial judge could not be criticised for failing to respond to a defence that was not raised.

(3) Did the trial judge err in awarding substantial indemnity costs against the appellants?

Yes. The Court varied the trial judge’s costs award. The appellants made three arguments. First, they argued that the trial judge’s costs award was wrong in principle. The Court agreed with the trial judge that the behaviour of the appellants warranted substantial indemnity costs in light of A.H.’s misconduct. A.H. had disputed the authenticity of a document which proved to be authentic. This act of advancing an argument that A.H. knew to be false, amounted to evidence of egregious misconduct. Secondly, the appellants argued that the siblings should have been considered “non-parties” without any responsibility for costs. The trial judge found that the siblings actively participated and the interests of A.H. were not separate from the siblings. The Court agreed with the trial judge. Thirdly, the appellants argued that the trial judge erred in finding that the Trustee was entitled to recover her full indemnity costs out of the estate, including those costs related to disputes over items solely between her and A.H. The parties concurred in suggesting that the range of costs attributable to the Trustee’s personal disputes warranted a reduction. The Court agreed and varied the costs award by reducing the remainder of costs ordered to be paid by the estate to the Trustee by $7,500. The Court left the disposition of costs on the Malibu loan/gift issue remitted to the trial judge hearing the re-trial. The costs appeal was otherwise dismissed.


Magnotta v. Yu, 2021 ONCA 185

[MacPherson, Gillese and Nordheimer JJ.A.]

Counsel:

S. Dewart and M. Belanger, for the appellants

A.J. Esterbauer, A. Huggins and S. Hodge, for the respondents

Keywords: Contracts, Real Property, Civil Procedure, Settlements, Offers to Settle, Enforcement, Rules of Civil Procedure, Rule 49, York North Condominium Corp. No. 5 v. Van Horne Clipper Properties Ltd. (1989), 70 O.R. (2d) 317 (C.A.), Milios v. Zagas (1998), 38 O.R. (3d) 218 (C.A.), Srebot v. Srebot Farms Ltd., 2013 ONCA 84

facts:

The respondents were the vendors of a real estate property in an agreement for purchase and sale entered into with one of the appellants as purchaser. When the appellant failed to close the transaction, the respondents sued. Several offers to settle the litigation were exchanged between the parties, but the settlement offer at issue in this appeal was made by counsel for the appellants on May 29, 2019 (the “Offer”). Counsel for the respondent responded the same day the Offer was made, advising that it was insufficient.

Later, in July 2019, counsel for the respondents wrote to the appellants’ new counsel, advising that her clients were accepting the Offer. The appellants’ counsel responded two days later, stating that there was no offer to settle capable of being accepted, and that the Offer was no longer open for acceptance.

The respondents moved to enforce the settlement based on their acceptance of the Offer. The motion judge granted the motion, after concluding that the Offer complied with the requirements in Rule 49 of the Rules of Civil Procedure: (1) it was made in writing; (2) by a person with the authority to make it; (3) it was effectively served on the opposing party; (4) it was capable of acceptance; (5) it was not time limited; and (6) it was not withdrawn (York North Condominium Corp. No. 5 v. Van Horne Clipper Properties Ltd. (1989), 70 O.R. (2d) 317 (C.A.)). Further, even if the Offer had been initially rejected, it remained open for acceptance because it had not been withdrawn.

Since the Offer complied with Rule 49, the motion judge held that it should be presumptively enforced. Accordingly, the motion judge declined to exercise his discretion to not enforce the settlement, and concluded that this was not “one of the rare cases” where an injustice would result if the settlement was enforced.

issues:

(1) Did the motion judge err in refusing to exercise his discretion to not enforce the settlement?

holding:

Appeal dismissed.

reasoning:

(1) No. The standard of review of a judge’s exercise of discretion to enforce a settlement was set out in Milios v. Zagas (1998), 38 O.R. (3d) 218 (C.A.). In Srebot v. Srebot Farms Ltd., 2013 ONCA 84, the deferential approach set out in Milios was reiterated, and it was emphasized that discretion not to enforce a settlement should be reserved for rare cases where compelling circumstances would mean that enforcement of the settlement is not in the interests of justice.

Broadly speaking, all of the relevant factors disclosed by the evidence must be taken into account. The appellants submitted that the motion judge erred by not considering the specific factors set out in Milios. The Court rejected this argument, and concluded that the motion judge clearly took into consideration all relevant factors when exercising his discretion. The specific factors applied in Milios were important in the circumstances of that case. However, it does not necessarily follow that they are relevant in all cases, and that failing to strictly adhere to them amounts to an error in law.

In short, the Court saw no basis to interfere with the motion judge’s findings. In fact, it was evident that the motion judge fully considered all of the factors raised by the appellants themselves, and nonetheless concluded that this was not one of the “rare cases”.


Malik v. Nikbakht, 2021 ONCA 176

[Feldman, Paciocco and Coroza JJ.A.]

Counsel:

J Cormier and H Chalmers, for the appellant

T.P. Charney, C. Edwards and J. Omran, for the respondent

Keywords: Torts, Negligence, MVA, Family Law Claims, Civil Procedure, Limitation Periods, Family Law Act, R.S.O. 1990, c. F.3, s. 61, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B., Bazkur v. Coore, 2012 ONSC 3468 (Div. Ct.), Camarata v. Morgan, 2009 ONCA 38, Macartney v. Warner (2000), 46 O.R. (3d) 641 (Ont. CA), Ridel v. Cassin, 2014 ONCA 763

facts:

The appellant, his wife, and their 3 children were injured in a 3-car collision. He sued the other drivers for damages relating to his injuries, but did not include a claim under s. 61 of the Family Law Act (“FLA”) for his losses arising from the injuries to his children. Over 4 years after the accident, the appellant brought a motion for leave to amend his pleadings to add his own s. 61 FLA claims. The respondent, one of the defendants, resisted the appellant’s motion and argued that the s. 61 FLA claims constituted a new statutory cause of action that was statute-barred.

A master of the Superior Court of Justice granted the appellant’s motion. The master relied on Bazkur v. Coore, in which the court held that subsequent s. 61 FLA claims may be added to a timely negligence action and are not subject to the two-year limitation period under the Limitations Act, 2002. The respondent successfully appealed to a judge of the Superior Court of Justice. The appeal judge declined to follow Bazkur, saying it was “plainly wrong,” and concluded that the appellant’s claim under s. 61 FLA was a cause of action distinct from the timely negligence action. The Master’s order was set aside and the appellant’s motion for leave to amend was dismissed.

issues:

(1) Did the appeal judge err in law in finding that the appellant’s s. 61 FLA claims constituted a cause of action distinct from his negligence claim?

holding:

Appeal dismissed.

reasoning:

(1) No. The cause of action created by s. 61 FLA is derivative. The appellant’s FLA claim would be for his damages arising out of injuries to his children as a result of the defendants’ negligent breaches of duties of care owed to his children. This was a fundamentally different claim than the appellant’s negligence action, which claimed damages arising from his own injuries caused by the defendants’ allegedly negligent breaches of duties of care owed to him. Had the appellant brought his s. 61 FLA claim in a timely way, he could have done so even without commencing a negligence action of his own.

The Court also found that the appeal judge was correct to not follow Bazkur. That case has only ever been cited for the uncontroversial proposition that claims for additional damages arising from an existing cause of action in a timely claim are not barred by the Limitations Act, 2002. The Court pointed out that the error in Bazkur occurred in the application of that principle. Therefore, the appeal judge was correct to dismiss the appellant’s motion for leave to amend his pleadings to bring a new statutory cause of action outside the limitation period.


SHORT CIVIL DECISIONS

Lad v. Marcos, 2021 ONCA 183

[Lauwers, Trotter and Zarnett JJ.A.]

Counsel:

D. Konomi and T.M. Morgan, for the moving parties

T. Evangelidis, for the responding parties JM, ASM, and CAM

G. Hemsworth, for the responding parties MM and Marcos Limited Building Design Consultants

Keywords: Civil Procedure, Appeals, Jurisdiction, Orders, Final or Interlocutory, Striking Pleadings, No Reasonable Cause of Action, Substantial Indemnity Costs, Rules of Civil Procedure, Rule 21.01(1)(a), Courts of Justice Act, RSO 1990, c. C.43, s. 19(1)(a), Paulpillai Estate v. Yusuf, 2020 ONCA 655, Atlas Holdings v. Vratsidas, 2012 ONSC 1375, Ball v. Donais (1993), 13 OR (3d) 322 (CA)

T.A.W. v. J.C.L., 2021 ONCA 192

[Fairburn A.C.J.O., van Rensburg and Huscroft JJ.A.]

Counsel:

T.A.W., acting in person

N. Shelsen, for the respondent

Keywords: Family Law, Torts, Fraudulent Misrepresentation, Negligent Infliction of Mental Distress, Unjust Enrichment, Civil Procedure, Transfer to Family Court, Striking Pleadings, No Reasonable Cause of Action, Substantial Indemnity Costs, Rules of Civil Procedure, Rule 21.01(1)(b), Hamilton v. Open Window Bakery Ltd., 2004 SCC 9

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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.