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Good afternoon.

Following are this week’s summaries of the Court of Appeal for Ontario for the week of June 14, 2021.

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In Kelava v. Spadacini, the Court found that a Deputy Judge of the Small Claims Court has the jurisdiction to make a representation order relying on Rule 12 of the ordinary Rules of Civil Procedure by analogy. The overriding consideration in Small Claims Court matters is access to justice.

In Loan Away Inc. v. Facebook Canada Ltd., the Court enforced Facebook’s forum selection clause requiring a lender who advertised and made loans through Facebook to sue in California.

In Johnson v Ontario, the dispute was whether a party could include an affidavit from its lawyer in their Appeal Book and Compendium (“ABC”) that spoke to the appellant’s request to extend the time to opt out of a class action. The Court permitted the filing of the affidavit, indicating that it was not its practice to consider, in advance of the hearing of an appeal, whether any specific document included in an ABC was relevant or not. The Court lamented the fact that this motion was characteristic of far too many civil motions brought that take up precious court time and could have been avoided if counsel acted reasonably.

Other topics covered this week included insurance coverage for water damage under a homeowners’ policy, appeals under s. 193 of the BIA, security for costs of an appeal in the mortgage enforcement context, the oppression remedy, the interpretation of a real estate commission agreement and vexatious litigants in the family law context and judicial immunity context.

Wishing everyone an enjoyable weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Table of Contents

Civil Decisions

Tataryn v. Axa Insurance Canada, 2021 ONCA 413

Keywords: Contracts, Interpretation, Insurance, Homeowners’ Policy, Coverage, Exclusions, Water Damage, Civil Procedure, Summary Judgment, Wilson v. INA Insurance Co. of Canada (1993), 80 B.C.L.R. (2d) 361 (C.A.), Dodge v. York Fire Insurance Co., 1911 CarswellOnt 41 (C.A.), Progressive Homes Ltd. v. Lombard General Insurance Co. of Canada, 2010 SCC 33

Ting (Re), 2021 ONCA 425

Keywords: Bankruptcy and Insolvency, Civil Procedure, Appeals, Bankruptcy and Insolvency Act, s. 193, 270 and s. 272(1)(b), Courts of Justice Act, R.S.O. 1990, c. C.43, s. 6 and 6(1), Winding-up Act, R.S.C., 1985, c. W-11, s. 103, Rules of Civil Procedure, Rule 14.05(3)(d), Canada (Superintendent of Bankruptcy) v. 407 ETR Concession Company Limited, 2012 ONCA 569, Wallace (Re), 2016 ONCA 958, Shaver-Kudell Manufacturing Inc. v. Knight Manufacturing Inc., 2021 ONCA 202, 2003945 Alberta Ltd. v. 1951484 Ontario Inc., 2018 ABCA 48, Business Development Bank of Canada v. Astoria Organic Matters Ltd., 2019 ONCA 269, Rusinek & Associates Inc. v. Arachchilage, 2021 ONCA 112, RREF II BHB IV Portofino, LLC v. Portofino Corporation, 2015 ONCA 906, Elias v. Hutchison, 1981 ABCA 31, Re Ravelston Corp. (2005), 24 C.B.R. (5th) 256, Business Development Bank of Canada v. Pine Tree Resorts Inc., 2013 ONCA 282, Canada Deposit Insurance Corp. v. Commonwealth Trust Co. (1993), 35 C.B.R. (3d) 208, Simonelli v. Mackin, 2003 ABCA 47

Sub-Prime Mortgage Corporation v. Kaweesa, 2021 ONCA 431

Keywords: Contracts, Real Property, Mortgages, Civil Procedure, Appeals, Security for Costs, Stay of Enforcement, Rules of Civil Procedure, Rules 50.10(1) and 61.06(1), Heidari v. Naghshbandi, 2020 ONCA 757

Murray v. Pier 21 Asset Management Inc., 2021 ONCA 424

Keywords: Corporations, Oppression, Contracts, Share Purchase Agreements, Remedies, Equitable Damages, Civil Procedure, Fresh Evidence, Costs, Canada Business Corporations Act, R.S.C. 1985, c. C-44, Palmer v. The Queen, [1980] 1 S.C.R. 759, Wilson v. Alharayeri, 2017 SCC 39, Ford Motor Co. of Canada, Ltd. v. Ontario Municipal Employees Retirement Board (2006), 263 D.L.R. (4th) 450 (Ont. C.A.), BCE Inc. v. 1976 Debentureholders, 2008 SCC 69, Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, Eastern Power Limited v. Ontario Electricity Financial Corporation, 2012 ONCA 366

Harvey Kalles Realty Inc. v. BSAR (Eglinton) LP, 2021 ONCA 426

Keywords: Contracts, Interpretation, Real Property, Commercial Leases, Commission Agreement, Conditional Offer, Commercial Reasonableness, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Resolute FP Canada Inc. v. Ontario (Attorney General), 2019 SCC 60

Kelava v. Spadacini, 2021 ONCA 428

Keywords: Civil Procedure, Small Claims Court, Jurisdiction, Representation Orders, Small Claims Court Rules, O. Reg. 258/98, Rule 1.03(2), Rules of Civil Procedure, R. 12.07, Van de Vrande v. Butkowski, 2010 ONCA 230, Riddel v. Apple Canada Inc., 2017 ONCA 590, Bruyea v. Canada (Veteran Affairs), 2019 ONCA 599

Hart v. Fullarton, 2021 ONCA 438

Keywords: Family Law, Spousal Support, Civil Procedure, Appeals, Vexatious Litigants, Courts of Justice Act, R.S.O. 1990, c. C.43, ss 6(1)(b), 140(1), section 140(3), 140(4)(e), Family Law Act, Part III, Rules of Civil Procedure, Rule 1.03, Varma v. Rozenberg, [1998] O.J. No. 4183 (C.A.), Kalaba v. Bylykbashi (2006), 265 D.L.R. (4th) 320 (Ont. C.A.), Vermette v. Nassr, 2016 ONCA 658, Chavali v. The Law Society of Upper Canada, 2007 ONCA 482

Johnson v. Ontario , 2021 ONCA 443

Keywords: Civil Procedure, Class Proceedings, Appeals, Appeal Books and Compendia, Rules of Civil Procedure, Rule 61.10(1)(i), R. v. Smith, (2001), 154 O.A.C. 51, (C.A.), leave to appeal refused, [2002] S.C.C.A. No. 156

Loan Away Inc. v. Facebook Canada Ltd., 2021 ONCA 432

Keywords: Contracts, Commercial, Forum Selection Clauses, Enforceability, Civil Procedure, Jurisdiction, Stay of Proceedings, Strong Cause Test, Romanko v. Aviva Canada Inc., 2018 ONCA 663, Estrada v. Estrada, 2016 ONCA 697, Z.I. Pompey Industrie v. ECU-Line N.V., 2003 SCC 27, Douez v. Facebook, Inc., 2017 SCC 33, GreCon Dimter inc. v. J.R. Normand Inc., 2005 SCC 46

Short Civil Decisions

Berman v. Berman, 2021 ONCA 439

Keywords: Family Law, Evidence

Gorman v. Sadja, 2021 ONCA 430

Keywords: Family Law, Contracts, Evidence

Ahmed v. Ontario (Attorney General), 2021 ONCA 427

Keywords: Civil Procedure, Striking Pleadings, Frivolous, Vexatious, Abuse of Process, Judicial Immunity, Justices of the Peace Act, R.S.O. 1990, c. J.4, s. 20, Rules of Civil Procedure, Rules 2.1.01, 2.1, 2.1.01, Visic v. Elia Associates Professional Corporation, 2020 ONCA 690, National Bank of Canada v. Guibord, 2020 ONCA 677, Rallis v. Myers, 2019 ONCA 437, Morier and Boily v. Rivard, [1985] 2 S.C.R. 716, Ernst v. Alberta Energy Regulator, 2017 SCC 1, Fitzgerald v. Reaume, 2021 ONCA 330, Beazley v. Canada (Attorney General), 2021 ONCA 117

Halton (Regional Municipality) v. F. Greco & Sons Limited (Greco Construction), 2021 ONCA 446

Keywords: Provincial Offences, Civil Procedure, Appeals, Leave to Appeal, Fresh Evidence, Striking Documents, Rules of Civil Procedure, Rule 25.11, Halton (Regional Municipality) v. F. Greco & Sons Limited (Greco Construction), 2021 ONCA 322, Hillmond Investments Ltd. v. Canadian Imperial Bank of Commerce (1996), 135 D.L.R. (4th) 471 (Ont. C.A.), Denison Mines Limited v. Ontario Hydro (2001), 56 O.R. (3d) 181 (C.A.)

2650971 Ontario Inc. v. Shameti, 2021 ONCA 433

Keywords: Civil Procedure, Appeals, Extension of Time, Partition Act, R.S.O. 1990, c. P.4, Rules of Civil Procedure, Rules 63.01(1), 66, Issasi v. Rosenzweig, 2011 ONCA 112, 277 O.A.C. 391, Duca Community Credit Union Limited. V. Giovannoli (2001), 142 O.A.C. 146 (C.A.)


CIVIL DECISIONS

Tataryn v. Axa Insurance Canada, 2021 ONCA 413

[Roberts, Miller and Thorburn JJ.A.]

Counsel:

A.L. Barber, for the appellant
B.C. Elkin, for the respondents, S. T. and S.G. Tataryn Professional Corporation
P. Santini, for the respondents, I. H. and Cohen & Lord Insurance Brokers Limited
K. Dow, for the respondent, C. M., making no submissions

Keywords: Contracts, Interpretation, Insurance, Homeowners’ Policy, Coverage, Exclusions, Water Damage, Civil Procedure, Summary Judgment, Wilson v. INA Insurance Co. of Canada (1993), 80 B.C.L.R. (2d) 361 (C.A.), Dodge v. York Fire Insurance Co., 1911 CarswellOnt 41 (C.A.), Progressive Homes Ltd. v. Lombard General Insurance Co. of Canada, 2010 SCC 33

facts:

The Respondent’s property was insured under a Homeowners Comprehensive policy with the appellant (“the Policy”). The Respondent purchased an additional Business Interruption Endorsement, as the property was also the Respondent’s place of business. The Respondent renovated part of the property, and during these renovations two instances of water damage occurred.

The Respondent sought coverage under the Policy. The Appellant made some payments for the first loss but denied the second. The Appellant cited the exclusion clause of the Policy that denied payment for damages for property “under construction” as justification for denying coverage of the second claim.

The Respondent commenced an action against the Appellant. The Respondent brought a motion to declare that the “under construction” exclusion clause did not apply. The motion judge granted the motion. The Appellant now appeals the motion judge’s ruling.

issues:

(1) Did the motion judge err in his interpretation of the terms “under construction” because he failed to construe them in the entire context of the Policy and the limited risk covered under a homeowner’s policy of insurance?
(2) Did the motion judge fail to consider the entirety of the evidence and focus too narrowly on the state of renovations following the second loss?
(3) What is the proper definition of “under construction” in the context of insurance?

holding:

Appeal dismissed.

reasoning:

(1) No.
The motion judge properly instructed himself on the applicable rules of contractual interpretation, including that he was required to “give effect to the clear language of the policy, reading it as a whole”. He considered the plain meaning of the term “under construction”, which he found to be unambiguous, and applied it to the entirety of the evidence of the state of the renovations to the Respondent’s property. The finding as to whether a property is “under construction” is a question of fact and the fact that a house is under renovation does not mean it is “under construction”: Wilson v. INA Insurance Co. of Canada (1993), 80 B.C.L.R. (2d) 361 (C.A.). The Court accepted the motion judge’s conclusion that the extent of renovations was not sufficient to support a finding that the house was “under construction”.

(2) No.
The motion judge applied the term “under construction” to the entirety of the evidence of the state of renovations of the property.

(3) Declined.
The court declined to give a proper definition of “under construction”. It was not possible nor desirable for the Court to give a definition that would apply to all cases: Dodge v. York Fire Insurance Co., 1911 CarswellOnt 41 (C.A.).


Ting (Re), 2021 ONCA 425

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

Counsel:

I. Ishai for the moving parties
A. Rogerson and A. Jazayeri for the responding party

Keywords: Bankruptcy and Insolvency, Civil Procedure, Appeals, Bankruptcy and Insolvency Act, s. 193, 270 and s. 272(1)(b), Courts of Justice Act, R.S.O. 1990, c. C.43, sections 6 and 6(1), Winding-up Act, R.S.C., 1985, c. W-11, s. 103, Rules of Civil Procedure, Rule 14.05(3)(d), Canada (Superintendent of Bankruptcy) v. 407 ETR Concession Company Limited, 2012 ONCA 569, Wallace (Re), 2016 ONCA 958, Shaver-Kudell Manufacturing Inc. v. Knight Manufacturing Inc., 2021 ONCA 202, 2003945 Alberta Ltd. v. 1951484 Ontario Inc., 2018 ABCA 48, Business Development Bank of Canada v. Astoria Organic Matters Ltd., 2019 ONCA 269, Rusinek & Associates Inc. v. Arachchilage, 2021 ONCA 112, RREF II BHB IV Portofino, LLC v. Portofino Corporation, 2015 ONCA 906, Elias v. Hutchison, 1981 ABCA 31, Re Ravelston Corp. (2005), 24 C.B.R. (5th) 256, Business Development Bank of Canada v. Pine Tree Resorts Inc., 2013 ONCA 282, Canada Deposit Insurance Corp. v. Commonwealth Trust Co. (1993), 35 C.B.R. (3d) 208, Simonelli v. Mackin, 2003 ABCA 47

facts:

The appellant sought to appeal two orders made against him in the context of bankruptcy proceedings in Ontario involving his father. His father was adjudged bankrupt by a Hong Kong court in 2016. The bankruptcy order was recognized by the Ontario Superior Court of Justice in 2017, and the moving parties, who are trustees in bankruptcy of the bankrupt, were appointed as “foreign representatives”.
In January 2019, the appellant failed to attend an examination and the trustee brought a motion for contempt. Dietrich J. found the appellant in contempt and allowed him to purge his contempt within 10 days. The appellant delivered a notice of appeal of that order. The appellant was sentenced to seven days’ incarceration for contempt that came into effect seven days after the final adjudication of the appellant’s appeal. The appellant served an additional notice of appeal in respect of the penalty order. The appellant’s notices of appeal assert that he has a right of appeal under s. 193(a) of the Bankruptcy and Insolvency Act (“BIA”). The trustee moved to quash the appeal.

issues:

(1) Did the appellant have a right to appeal the motion judge’s contempt order and the penalty order under s. 193(a) of the BIA?

holding:

Motion granted.

reasoning:

(1) No.
The Court of Appeal has repeatedly held that an appeal from an order made in bankruptcy proceedings is governed by s. 193 of the BIA. An order will also be subject to the appeal routes under s. 193 (rather than under s. 6 of the Courts of Justice Act (the “CJA”) where the order is made by a judge exercising powers conferred by the BIA. While an order may involve a bankrupt, or be made during the currency of bankruptcy proceedings, that is not determinative of whether an appeal from that order is governed by the BIA or CJA.

In the case at hand, the orders were subject to the appeal routes under s. 193 of the BIA. The appellant was brought into his father’s bankruptcy proceedings through the order of Penny J., with which he failed to comply leading to the contempt order and penalty order.

The appellant contended that he had a right to appeal the motion judge’s contempt order and the penalty order under s. 193(a) of the BIA, which provides for an appeal to this court “if the point at issue involves future rights”. The appellant asserted that the appeal involved future rights because his appeal raised matters of procedural fairness. Future rights have been described as “rights which could not at the present time be asserted but which will come into existence at a future time”: Elias v. Hutchison, 1981 ABCA 31, 37 C.B.R. (N.S.) 149, at para. 28, cited with approval in Re Ravelston Corp. (2005), 24 C.B.R. (5th) 256 (Ont. C.A.), at para. 19.

Recent case law applying s. 193 of the BIA confirms that issues of procedural fairness typically engage a party’s present, and not future rights. In this case, the appellant’s right to procedural fairness was a present right that existed at the time of the hearing before the motion judge. His appeal of the contempt order and the penalty order did not engage future rights within the scope of s. 193(a) of the BIA. For these reasons, the appeal was quashed.


Sub-Prime Mortgage Corporation v. Kaweesa, 2021 ONCA 431

[Fairburn A.C.J.O., Harvison Young and Jamal JJ.A.]

Counsel:

M. Tubie, for the moving parties
R. Das, for the responding party T. W.
G. Cohen, for the responding parties Sub-Prime Mortgage Corporation and Elle Mortgage Corporation

Keywords: Contracts, Real Property, Mortgages, Civil Procedure, Appeals, Security for Costs, Stay of Enforcement, Rules of Civil Procedure, Rules 50.10(1) and 61.06(1), Heidari v. Naghshbandi, 2020 ONCA 757

facts:

The moving parties were the owners of a heavily encumbered house. A mortgage enforcement action was brought by a number of mortgagees. The mortgagees obtained an order of security for costs of their appeal from Paciocco J.A., who also lifted the temporary stay on the enforcement of the writ of possession which the motion judge, Stinson J., had granted for 90 days, expiring May 11, 2021.
The moving parties sought to set aside both orders of Paciocco J.A and asked the court to grant an order to stay Stinson J.’s order.

issues:

(1) Did Paciocco J.A. err in granting the security for costs motion?
(2) Did Paciocco J.A. err in his application of Rule 61.06(1)(a) of the Rules?
(3) Did Paciocco J.A. err in failing to continue the stay of enforcement?

holding:

Motion dismissed.

reasoning:

(1) No.
The Court found no error of law or fact in relation to the finding made by both Stinson J. and Paciocco J.A. that the pandemic did not frustrate the minutes of settlement. Further, there was no error on the part of Paciocco J.A. with respect to his treatment of the ground of appeal that the responding parties had failed to comply with the terms of the minutes, as there was no evidentiary basis for that argument.

Further, Paciocco J.A. specifically noted that Rule 50.10(1) of the Rules of Civil Procedure permits pre-trial conference judges to preside at the trial of an action with the written consent of the parties. Counsel had consented to Stinson J. hearing the underlying motion.

Finally, Paciocco J.A.’s finding that the moving parties’ appeal was “vexatious” was well grounded in the record and the Court owed deference to those findings in the absence of palpable and overriding error.

(2) No.
Paciocco J.A. did not err in his application of Rule 61.06(1)(a). There was sufficient basis to find that the moving parties had insufficient assets in Ontario, as they had failed to make payment on the encumbrances on the property in question for some time.

(3) No.
The stay had expired. This ground of appeal was therefore found to be moot.


Murray v. Pier 21 Asset Management Inc., 2021 ONCA 424

[Pepall, Roberts and Thorburn JJ.A.]

Counsel:

I. Ellyn and K.J. Manning, for the appellants
E.J. Babin, C.L. Spy, and M. Bookman, for the respondents

Keywords: Corporations, Oppression, Contracts, Share Purchase Agreements, Remedies, Equitable Damages, Civil Procedure, Fresh Evidence, Costs, Canada Business Corporations Act, R.S.C. 1985, c. C-44, Palmer v. The Queen, [1980] 1 S.C.R. 759, Wilson v. Alharayeri, 2017 SCC 39, Ford Motor Co. of Canada, Ltd. v. Ontario Municipal Employees Retirement Board (2006), 263 D.L.R. (4th) 450 (Ont. C.A.), BCE Inc. v. 1976 Debentureholders, 2008 SCC 69, Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, Eastern Power Limited v. Ontario Electricity Financial Corporation, 2012 ONCA 366

facts:

The appellants, D.S. and Pier 21 Asset Management (“Pier 21”), appealed the judgment and orders of Penny J and sought leave to appeal the costs award. In 2005, D.S. launched Pier 21 and started an affair with the respondent, E.M. E.M. agreed to join D.S. in launching Pier 21 in exchange for 300,000 Class A shares.

In 2012, E.M. entered into a Share Purchase Agreement, whereby Pier 21 redeemed 142,250 Class A shares at $3.42 per share. As a result, E.M. owned 9.1% of Class A shares. By the end of 2014, Pier 21 had $3.2 billion in assets under management and $15 million in revenue for the year. E.M. left Pier 21 in December of 2014, but the appellant refused to buy out her remaining interest in the company.

In response to E.M.’s three requests made in her oppression claim, the trial judge held that: a) beyond the fact that the two-year limitation period passed, the 2012 Share Purchase Agreement should not be reversed because it was not oppressive, unfairly prejudicial, or unfairly disregarded her interests, b) the appellant was ordered to purchase E.M.’s remaining interest in the company for $3,576,300 (based on the expert evidence regarding Pier 21’s fair valuation), and c) E.M. was awarded $605,579 in equitable damages.

issues:

(1) Should the Court accept fresh evidence from the appellants regarding the independence of the respondent’s expert witness?
(2) Did the trial judge err in failing to consider the appellants’ Rule 59.06(2)(a) motion to re-open trial?
(3) Did the award of equitable damages provide the respondent with a windfall?
(4) Did the trial judge err in equating the experience of the two expert witnesses?
(5) Does the respondent have valid grounds for appeal?
(6) Did the trial judge err with respect to his costs award?

holding:

Appeal and cross-appeal dismissed. Leave to appeal costs refused. Motions for the admission of fresh evidence dismissed.

reasoning:

(1) No.
The dockets of the respondent’s expert witness on the valuation of Pier 21 noted that he reviewed a letter written by the husband of the respondent. However, the dockets do not pass the test for admitting fresh evidence because it would not likely be conclusive of any issue on appeal: Palmer v. The Queen, [1980] 1 S.C.R. 759, at para 775. The mere fact that the husband of the respondent may have provided some comments to the expert does not mean that the expert became an advocate or lacked independence.

(2) No.
The trial judge had the jurisdiction to write an endorsement in which he declined to hear the motion. It was clear that the arguments for the motion were similar to that of fresh evidence, and it was evident from a review of the fresh evidence that it would not meet the threshold for admission.

(3) No.
The appellants argued that the order to purchase the shares of the respondent sufficiently addressed the oppression. The Court noted that the Canada Business Corporations Act vests the trial judge with broad discretion when dealing with the oppression remedy. Appellate courts should adopt a deferential stance in the absence of reviewable error or a manifestly unjust result: Wilson v. Alharayeri, 2017 SCC 39, at para 59. The trial judge found that the respondent’s termination and status as shareholder was “closely connected” and her reasonable expectations regarding the manner in which she was terminated were thwarted. Therefore, there was no reason to interfere with the equitable remedy ordered by the trial judge.

The respondent argued that the equitable damages ought to have been increased because the appellants have had the respondent’s capital since 2015. The trial judge was correct in that these issues arose after the conclusion of evidence at trial and to permit the claims at this stage would have been seriously prejudicial to the appellants. Though the trial judge had discretion in awarding higher equitably damages, he was under no such obligation: Ford Motor Co. of Canada, Ltd. v. Ontario Municipal Employees Retirement Board (2006), 263 D.L.R. (4th) 450 (Ont. C.A.), at para. 181.

(4) No.
The trial judge reviewed all of the expert evidence and reached a reasonable conclusion regarding the valuation of the company. There was no palpable and overriding error.

(5) No.
The trial judge did not err in concluding that there was no fiduciary relationship between D.S. and the respondent. They were not in a partnership or trust relationship but were merely shareholders of the same corporation: BCE Inc. v. 1976 Debentureholders, 2008 SCC 69, at paras. 37, 66.
Further, the trial judge did not err in finding that there was insufficient evidence of her opposition to the 2012 Share Purchase Agreement. There was no evidence provided to show that the respondent had concerns before the shares were purchased in 2012, so she did not meet the burden of proof.
Lastly, the trial judge did not err in deciding on the structure of the transaction for the respondent’s remaining shares. There was no evidence to support a reasonable expectation that she would be entitled to a structure that would minimize her tax liability.

(6) No.
Absent an error in principle or an award that is plainly wrong, a trial judge’s exercise of discretion in the award of costs is entitled to deference: Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, at para. 27. Further, Eastern Power Limited v. Ontario Electricity Financial Corporation, 2012 ONCA 366 provides that a consideration of the relative success of the parties may be appropriate in determining quantum of the entitlement to costs. The trial judge did so here without an error in principle.


Harvey Kalles Realty Inc. v. BSAR (Eglinton) LP, 2021 ONCA 426

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

Counsel:

J. Wortzman and S. Malthouse, for the appellant
I. Cantor, for the respondent

Keywords: Contracts, Interpretation, Real Property, Commercial Leases, Commission Agreement, Conditional Offer, Commercial Reasonableness, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Resolute FP Canada Inc. v. Ontario (Attorney General), 2019 SCC 60

facts:

The appellant appeals the trial judge’s decision awarding the respondent real estate brokerage commission with costs and interest pursuant to its claim as assignee of the commission payable under a Commission Agreement. The appellant submitted that no commission was owing because one of the two conditions set out in the Commission Agreement was not met. The first condition required that an offer to lease be entered into between the appellant and a “Tenant”, defined as “Loblaw Companies Limited or any associated, affiliated, related company or individual, nominees or any principals, partnerships, joint ventures, corporations, affiliates or associates for whom it is a nominee or to whom it is directly or indirectly related” within 24 months of the Commission Agreement. The second condition required that the “Tenant” subsequently enter a final form of lease with all conditions of the offer met or waived. The appellant argued that the trial judge erred in finding that the second condition was met because the eventual tenant, Shoppers Drug Mart, only became a Loblaws entity after the offer to lease was signed.

issues:

(1) Did the trial judge err in law when she found that Shoppers met the definition of “Tenant” in the offer to lease and in the Commission Agreement?
(2) Did the trial judge err in failing to find that the offer to lease had been automatically terminated?
(3) Did the trial judge make a series of palpable and overriding errors in reaching her decision?

holding:

Appeal dismissed.

reasoning:

(1) No.
The trial judge did not err in finding that Shoppers met the definition of “Tenant” in the relevant agreements. The trial judge’s findings constituted a commercially reasonable interpretation of a provision in the context of the entire Commission Agreement and the factual matrix. The Court disagreed with the appellant’s submission that because the definition of “Tenant” in the Commission Agreement included an entity to whom Loblaws “is” directly or indirectly related, the Commission Agreement contemplated only entities in existence at the time it was signed. The trial judge’s conclusion did not constitute a palpable and overriding error or a failure to give effect to the words of the agreement.

(2) No.
There was no reasonable basis for the trial judge to find that the offer to lease had been automatically terminated. The parties conducted themselves on the basis that the offer to lease had not been terminated and that a final form of lease would be signed. It was only in the alternative that the trial judge turned to the issue of whether the automatic termination provision may have been triggered. The trial judge found no supporting documentation or evidence setting out the timing, terms, and conditions under which the transaction continued after the point at which the appellant argued the offer to lease automatically terminated. Therefore, there were no reasonable basis for a finding of automatic termination.

(3) No.
The appellant did not demonstrate any palpable or overriding errors in any of the trial judge’s findings. The trial judge heard the evidence and made the factual findings that naturally flowed from the record before her.


Kelava v. Spadacini , 2021 ONCA 428

[Benotto, Miller and Trotter JJ.A.]

Counsel:

M.L. Solmon and L.J. Paddock, for the appellants
D. Spadacini, acting in person

Keywords: Civil Procedure, Small Claims Court, Jurisdiction, Representation Orders, Small Claims Court Rules, O. Reg. 258/98, Rule 1.03(2), Rules of Civil Procedure, Rule 12.07, Van de Vrande v. Butkowski, 2010 ONCA 230, Riddel v. Apple Canada Inc., 2017 ONCA 590, Bruyea v. Canada (Veteran Affairs), 2019 ONCA 599

facts:

The respondent brought a wrongful termination claim against the appellants in Small Claims Court. The deputy judge ordered an amendment to the style of the action by adding D.S. as the named representative for the defendant Union. As the Rules of the Small Claims Court (“RSCC”) do not reference representation orders, the deputy judge relied on Rule 1.03(2), which vests the discretion to defer to the Rules of Civil Procedure (“RCP”). Rule 12.07 of the RCP was relied upon, which provides that one or more persons may be authorized by the court to defend an action when numerous persons have the same interest.

On judicial review, the Divisional Court held that the deputy judge did not err in deferring to the RCP. The appellants appealed on the ground that the deputy judge did not have the jurisdiction because the RSCC had an “omission” as opposed to a “gap.” They maintained that a gap is something that is covered inadequately by the RSCC, whereas an omission is not addressed in the RSCC at all: Van de Vrande v. Butkowski, 2010 ONCA 230.

issues:

(1) Is the Small Claims Court prevented from naming a representative defendant in an action?
(2) Does the Small Claims Court have jurisdiction over unincorporated associations?

holding:

Appeal dismissed.

reasoning:

(1) No.
The RSCC is to be read in light of the overall objective of the Small Claims Court, which is access to justice. The RSCC provide for broad discretion to achieve this objective. If the rules do not directly address a matter, the court has the discretion to make “any order that is just”. Therefore, an order can be made even without reference to the RCP if it is just. The representative order was consistent with access to justice because an application to the Ontario Superior Court of Justice can be expensive and cause delay.

(2) Yes.
The fact that the RSCC does not reference jurisdiction over unincorporated associations does not constitute an omission. To constitute an omission, and therefore preclude the Small Claims Court from deferring to the RCP, there needs to be a marker of “deliberate legislative intent to omit”: Riddel v. Apple Canada Inc., 2017 ONCA 590, at para. 7. For example, in Bruyea v. Canada (Veteran Affairs), 2019 ONCA 599, section 137.1 of the Courts of Justice Act explicitly permitted summary dismissal by a “judge”, not “deputy judge” or “court”. There is no such marker in this case. Therefore, the deputy judge did not err in making the representation order.

 


Hart v. Fullarton, 2021 ONCA 438

[Brown J.A. (Motions Judge)]

Counsel:

M. Hart, acting in person
S, Benmor, for the responding party

Keywords: Family Law, Spousal Support, Civil Procedure, Appeals, Vexatious Litigants, Courts of Justice Act, R.S.O. 1990, c. C.43, sections 6(1)(b), 140(1), 140(3), 140(4)(e), Family Law Act, Part III, Rules of Civil Procedure, Rule 1.03, Varma v. Rozenberg, [1998] O.J. No. 4183 (C.A.), Kalaba v. Bylykbashi (2006), 265 D.L.R. (4th) 320 (Ont. C.A.), Vermette v. Nassr, 2016 ONCA 658, Chavali v. The Law Society of Upper Canada, 2007 ONCA 482

facts:

The Appellant had applied to the Superior Court of Justice for spousal support from the Respondent. The Respondent had asked the court to dismiss the application on the grounds that the Appellant was a “vexatious litigant”. In the Final Order, the trial judge dismissed the application and, pursuant to Courts of Justice Act (“CJA”) s. 140(1), ordered that the Appellant not commence any further proceeding against the Respondent in any court without leave from an Ontario Superior Court (“ONSC”) judge.

In response to several motions by the Appellant, the trial judge released an endorsement stating that the Appellant did not require leave from an ONSC judge to file an appeal of the trial decision.

The Appellant next filed a notice of appeal from the Final Order with the Divisional Court. The resulting endorsement stated that (i) any appeal from the vexatious litigant order was with the Ontario Court of Appeal and (ii) an appeal of any other part of the judgment required leave under s.140(1) of the CJA. The Appellant then attempted to file a notice of appeal of the Final Order. This was denied as it was beyond the 30-day appeal limit. The Appellant moved for an order extending the time period.

issues:

(1) Should the time to file a notice of appeal from that part of the Final Order which dismissed the Appellant’s application for spousal support be extended?

holding:

Motion dismissed.

reasoning:

(1) No.
Leave to appeal a vexatious litigant order is not required. Such an order is final in nature and appealable as of right to the Ontario Court of Appeal pursuant to s. 6(1)(b) of the CJA.

However, the Appellant was appealing the part of the Final Order that denied her spousal support. The Appellant sought leave to proceed with an appeal of the spousal support aspect of the Final Order from the Divisional Court. CJA s. 140(4)(e) states that no appeal lies from a refusal to grant leave to proceed: Chavali v. The Law Society of Upper Canada, 2007 ONCA 482. Consequently, there was no merit to the appeal that the Appellant sought to bring before the Court. The motion for an extension of time was dismissed.


Johnson v. Ontario, 2021 ONCA 443

[Brown J.A. (Motions Judge)]

Counsel:

N.S. Barkhordari, N.S. Gosai, and M.R. Sharp, for the moving party/appellant, D.P., class member
S. Pottle and R.V. Bambers, for the responding party, Her Majesty the Queen in Right of Ontario

Keywords: Civil Procedure, Class Proceedings, Appeals, Appeal Books and Compendia, Rules of Civil Procedure, Rule 61.10(1)(i), R. v. Smith, (2001), 154 O.A.C. 51, (C.A.), leave to appeal refused, [2002] S.C.C.A. No. 156

facts:

The appellant, a class member in a class proceeding defended by the respondent, appealed an order that denied him an extension of time to opt out of the class proceeding and moved for two orders. First, the appellant sought an extension of time to perfect his appeal until June 30, 2021. This order was unopposed and granted. The appellant also sought an order permitting him to include a short affidavit from his counsel in his Appeal Book and Compendium (“ABC”). This order was opposed by the respondent.

issues:

(1) Is the appellant permitted to include the affidavit from his counsel in his ABC?

holding:

Motion granted.

reasoning:

(1) Yes.

The affidavit falls into the category of “any other documents relevant to the hearing of the appeal that are referred to in the appellant’s factum” in Rule 61.10(1)(i) of the Rules of Civil Procedure. This rule permits the appellant to include the affidavit in his ABC.

It is not the practice of the Court to consider, in advance of the hearing of an appeal, whether any specific document included in an ABC is relevant or not. A panel ultimately forms its own view about the relevance or utility of any such document, such as the affidavit the appellant proposes to include. If a party includes irrelevant documents in an ABC, it is open to the panel to sanction that practice by an award of costs against the offending party.

The Court then observed that this motion was characteristic of far too many civil motions brought. This motion was characteristic of the type of procedural motion – the contents of an ABC – that counsel, acting reasonably, should be able to settle without consuming judicial time.


Loan Away Inc. v. Facebook Canada Ltd., 2021 ONCA 432

[Fairburn A.C.J.O., Harvison Young and Jamal JJ.A.]

Counsel:

M. Crampton, for the appellant
M. Spence, for the respondent
P. Underwood, for Facebook Canada Ltd., making no submissions

Keywords: Contracts, Commercial, Forum Selection Clauses, Enforceability, Civil Procedure, Jurisdiction, Stay of Proceedings, Strong Cause Test, Romanko v. Aviva Canada Inc., 2018 ONCA 663, Estrada v. Estrada, 2016 ONCA 697, Z.I. Pompey Industrie v. ECU-Line N.V., 2003 SCC 27, Douez v. Facebook, Inc., 2017 SCC 33, GreCon Dimter inc. v. J.R. Normand Inc., 2005 SCC 46

facts:

The appellant is a commercial online lender whose business largely derives from advertising on the respondent’s website. Upon signing up for the respondent’s website, users must agree to the respondent’s “Terms of Service” which contain forum selection and governing law clauses that provide any disputes with commercial users to be resolved exclusively before the U.S. District Court for the Northern District of California or a state court in San Mateo County under California law. Commercial users, like the respondent, must reaffirm these Terms of Service each time they buy advertising from the respondent.

In October 2018, the respondent suspended the appellant’s advertising. The appellant failed to resolve the issue by writing to the respondent’s related Canadian company. In December 2018, the appellants began to seek injunctive relief and damages from the respondent’s related Canadian company before the Ontario Superior Court of Justice which was later amended to seek relief from the respondent, as it solely operated the advertising platform. In May 2019, the respondent asked the court to stay the appellant’s application based on the forum selection clause. Before the return of the stay motion, the respondent suspended the appellant’s business page. At the return of the motion, the motion judge refused to adjourn at the appellant’s request to file this additional evidence and stated that the appellant’s application did not concern this issue.

The motion judge granted the respondent’s stay motion, as the appellant did not dispute the enforceability of the forum selection clause. The motion judge held that the appellant did not show “strong cause” to not enforce the clause because (1) it was a commercial contract, (2) the appellant filed no evidence addressing the convenience of the parties, fairness between the parties or interests of justice, and (3) the application sought no relief against the respondent’s related Canadian company. The appellant appealed the motion judge’s order to stay the appellant’s application seeking injunctive relief and a damages reference against the respondent for having suspended the appellant’s advertising.

issues:

(1) Did the motion judge err in refusing to adjourn the stay motion?
(2) Did the motion judge err in granting a stay based on the forum selection clause?

holding:

Appeal dismissed.

reasoning:

(1) No.
The appellant argued it should have been able to introduce new evidence, the shutdown of its business page, as the event occurred prior to the motion. The appellant asserted that by failing to allow this, the motion judge had decided the motion on an incomplete record.

An appellate court can intervene with a motion judge’s discretionary decision on whether to grant an adjournment only if the discretion is not exercised judicially based on proper principles, after considering all relevant factors: Romanko v. Aviva Canada Inc., 2018 ONCA 663. The Court found that the motion judge had made no such error. Since the appellant’s application did not concern the shutdown of its business page, and neither counsel was prepared to deal with the development, the motion judge was also entitled to find that the evidentiary record on the stay motion was complete.

Further, evidence about the substantive legal issues underlying the dispute between the parties was not relevant to the motion to enforce the forum selection clause: Z.I. Pompey Industrie v. ECU-Line N.V., 2003 SCC 27. Therefore, the Court found no basis to interfere with the motion judge’s decision.

(2) No.
The appellant’s second ground of appeal asserted that the motion judge erred in enforcing the forum selection clause and staying the Appellant’s application.
In commercial contexts, absent exceptional circumstances, forum selection clauses are generally enforced to hold sophisticated parties to their contractual bargain: Douez v. Facebook, Inc., 2017 SCC 33. The Court applied a two-step test to determine whether to enforce a forum selection clause and stay an action brought contrary to it:
i. At the first step, the party seeking a stay must establish that the forum selection clause is valid, clear, and enforceable, and that it applies to the cause of action before the court.
ii. At the second step, the plaintiff must establish “strong cause” not to enforce the forum selection clause. A court exercising its discretion at this step must consider all the circumstances, including the convenience of the parties, fairness between the parties, the interests of justice, and public policy.

The appellant accepted that the first step had been met but argued that the motion judge had erred in her application of the second step. First, the appellant asserted that there was a prima facie injustice in allowing the respondent to rely on the clause, as the appellant should not have to sue in California to learn why its advertising had been removed. The Court did not accept this submission, as the appellant’s application sought injunctive relief and a damages reference. To achieve this, it must sue in California as it agreed to in the “Terms of Service”.
Second, the appellant submitted that the motion judge had failed to consider that the appellant would have to engage in a multiplicity of proceedings against the respondent in California, and its subsidiary in Ontario. The Court disagreed with this submission as no relief was sought against the Canadian subsidiary and the appellant acknowledged it had no contract with the latter.

Finally, the appellant submitted that there was “strong cause” not to enforce the clause due to an inequality in bargaining power between the parties. The Court stated that even in the consumer context, inequality in bargaining power itself is not determinative. The motion judge had considered the relevant circumstances of the case and found that the “strong cause” criteria were not met by the appellant. The Court found those findings “unassailable” and therefore found no reason to intervene.


SHORT CIVIL DECISIONS

Berman v. Berman, 2021 ONCA 439

[Gillese, Tulloch and Roberts JJ.A.]

Counsel:

A. Franks, M. Zalev, and C. Wile, for the appellant
D.Z. Frodis and A. Tint, for the respondent

Keywords: Family Law, Evidence

Gorman v. Sadja, 2021 ONCA 430

[Fairburn A.C.J.O., Harvison Young and Jamal JJ.A.]

Counsel:

G.R. Hall and B. Cerqua, for the appellant
D. Frodis and K. Levitt, for the respondent

Keywords: Family Law, Contracts, Evidence

Ahmed v. Ontario (Attorney General), 2021 ONCA 427

[Fairburn A.C.J.O, Harvison Young and Jamal JJ.A.]

Counsel:

L. Ahmed, acting in person
M. Chung, for the respondent

Keywords: Civil Procedure, Striking Pleadings, Frivolous, Vexatious, Abuse of Process, Judicial Immunity, Justices of the Peace Act, R.S.O. 1990, c. J.4, s. 20, Rules of Civil Procedure, Rules 2.1.01, 2.1, 2.1.01, Visic v. Elia Associates Professional Corporation, 2020 ONCA 690, National Bank of Canada v. Guibord, 2020 ONCA 677, Rallis v. Myers, 2019 ONCA 437, Morier and Boily v. Rivard, [1985] 2 S.C.R. 716, Ernst v. Alberta Energy Regulator, 2017 SCC 1, Fitzgerald v. Reaume, 2021 ONCA 330, Beazley v. Canada (Attorney General), 2021 ONCA 117

Halton (Regional Municipality) v. F. Greco & Sons Limited (Greco Construction), 2021 ONCA 446

[Fairburn A.C.J.O., Harvison Young and Jamal JJ.A.]

Counsel:

P. Starkman and C. Zhang, for the moving party
T. Gordner, for the responding party

Keywords: Provincial Offences, Civil Procedure, Appeals, Leave to Appeal, Fresh Evidence, Striking Documents, Rules of Civil Procedure, Rule 25.11, Halton (Regional Municipality) v. F. Greco & Sons Limited (Greco Construction), 2021 ONCA 322, Hillmond Investments Ltd. v. Canadian Imperial Bank of Commerce (1996), 135 D.L.R. (4th) 471 (Ont. C.A.), Denison Mines Limited v. Ontario Hydro (2001), 56 O.R. (3d) 181 (C.A.)

2650971 Ontario Inc. v. Shameti, 2021 ONCA 433

[Brown J.A. (Motions Judge)]

Counsel:

H. Singh and O. Hoque, for the moving parties
M. Katzman, for the responding parties

Keywords: Civil Procedure, Appeals, Extension of Time, Partition Act, R.S.O. 1990, c. P.4, Rules of Civil Procedure, Rules 63.01(1), 66, Issasi v. Rosenzweig, 2011 ONCA 112, 277 O.A.C. 391, Duca Community Credit Union Limited. V. Giovannoli (2001), 142 O.A.C. 146 (C.A.)


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.