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Good afternoon.

Following are this week’s summaries of the Court of Appeal for Ontario for the week of October 25, 2021.

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In Cavanaugh v. Grenville Christian College, a class proceeding, the Court dismissed an appeal by a boarding school from a decision on a common issues trial that found the school liable to the class for punitive damages as a result of systemic negligence and breach of fiduciary duty.

In Kawaguchi v. Kawa Investments Inc., the Court confirmed that pleadings in a multi-defendant action are considered closed pursuant to Rule 25.05 of the Rules of Civil Procedure when the time to reply to all defences has passed and all defendants who have not defended have been noted in default. Pleadings do not close at different times with respect to different defendants.

Other topics covered included mortgage enforcement against an estate, Crown liability and immunity in the Crown wardship context, standing and extension of time to appeal in the Anti-SLAPP context, a trial to determine damages payable pursuant to an undertaking in damages given in support of a request for an injunction, and oppression in the condominium context.

For our readers who have not yet heard about it, I would like to introduce them to a new online publication, Civil Procedure & Practice in Ontario (CPPO). The CPPO is a new free online resource jointly published by the University of Windsor and CanLII. As most of our readers probably know, CanLII is a not-for-profit organization operated by the Federation of Law Societies of Canada and is dedicated to assisting with access to justice through the free and open dissemination of the laws of Canada to all members of the public. The CPPO was written by a team of 135 leading litigators and experts in Ontario civil procedure, led by Professor Noel Semple of Windsor Law School. I had the privileged to co-author two chapters to CPPO dealing with Rules 54 and 55 (Directing a Reference and Procedure on a Reference).

CPPO will serve as a guide to Ontario’s Rules of Civil Procedure, Courts of Justice Act, and Limitations Act, and will be accessible not only to practitioners, but to members of the public. It contains not only the text of all these rules and statutory provisions, but also commentary and annotations to all the relevant case law applying and interpreting each rule and section. To access Civil Procedure & Practice in Ontario, please click here, and make sure to bookmark the site for easy access.

I would encourage all of our readers to consult CPPO in their daily practice, and to spread the word among colleagues. In addition, the authors and Professor Semple would welcome any feedback and ideas for improvement.

Wishing everyone an enjoyable weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Table of Contents

Civil Decisions

Bodnar v. Boban Estate, 2021 ONCA 746

Keywords: Contracts, Debtor-Creditor, Real Property, Mortgages, Defences, Laches, Civil Procedure, Summary Judgment, Issue Estoppel, Cause of Action Estoppel, Abuse of Process, Appeals, New Issues on Appeal, Statute of Frauds, R.S.O. 1990, c. S.19, Kaiman v. Graham, 2009 ONCA 77, Ontario Energy Savings L.P. v. 767269 Ontario Ltd., 2008 ONCA 350, Ross v. Ross (1999), 1999 NSCA 162 (CanLII), 181 N.S.R. (2d) 22 (C.A.)

Echelon Environmental Inc. v. Glassdoor Inc., 2021 ONCA 763

Keywords: Torts, Defamation, Civil Procedure, Anti-SLAPP, Appeals, Extension of Time, Standing, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 137.1(3), 2363523 Ontario Inc. v. Nowack, 2018 ONCA 286, Howard v. Martin, 2014 ONCA 309, Leighton v. Best, 2014 ONCA 667, Enbridge Gas Distribution Inc. v. Froese, 2013 ONCA 131, Monteith v. Monteith, 2010 ONCA 78, Cunningham v. Hutchings, 2017 ONCA 938, 40 Park Lane Circle v. Aiello, 2019 ONCA 451

Miragliotta v. Zanette, 2021 ONCA 764

Keywords: Civil Procedure, Orders, Enforcement, Injunctions, Undertakings in Damages

Cavanaugh v. Grenville Christian College,, 2021 ONCA 755

Keywords: Torts, Systemic Negligence, Breach of Fiduciary Duty, Boarding Schools, Civil Procedure, Class Proceedings, Evidence, Experts, Whiten v. Pilot Insurance, 2002 SCC 18, Cavanaugh v. Grenville Christian College, 2012 ONSC 2995, affd 2013 ONCA 139, 360 D.L.R. (4th) 670, Cavanaugh v. Grenville Christian College, 2012 ONSC 2398, Cavanaugh v. Grenville Christian College, 2014 ONSC 290, Housen v. Nikolaisen, 2002 SCC 33, Carmichael v. GlaxoSmithKline Inc., 2020 ONCA 447, Rumley v. British Columbia, 2001 SCC 69

McFlow Capital Corp v. James, 2021 ONCA 753

Keywords: Real Property, Condominiums, Oppression, Remedies, Punitive Damages, Civil Procedure, Substantial Indemnity Costs, Prejudgment Interest, Limitations Act, 2002, S.O. 2002 c.24, s. 5(1), Courts of Justice Act, R.S.O. 1990, c. C.43, s. 128, Condominium Act 1998, S.O. 1998, c. 19, Section 135, Grant Thornton LLP v. New Brunswick, 2021 SCC 31, Gordon Dunk Farms Limited v. HFH Inc., 2021 ONCA 681, Whiten v. Pilot Insurance Co., 2002 SCC 18, Richard v. Time Inc., 2012 SCC 8, Cinar Corporation v. Robinson, 2013 SCC 73, Sliwinski v. Marks (2006), 211 O.A.C. 215, Gary Anthony Bennett Professional Corporation v. Triella Corp., 2019 ONCA 225, Brad-Jay Investments Limited v. Village Developments Limited (2006), 218 O.A.C 315, Hamilton v. Open Window Bakery Ltd., 2004 SCC 9 , Duong v. NN Life Insurance Co. of Canada (2001) 141 O.A.C. 307, Metropolitan Toronto Police Widows & Orphans Fund v. Telus Communications Inc. (2008), 44 B.LR. (4th), Bank of America Canada v. Mutual Trust Co., 2002 SCC 43

P.Y. v. Ontario (Attorney General), 2021 ONCA 761

Keywords: Torts, False Arrest, False Imprisonment, Malicious Prosecution, Charter Breaches, Negligent Investigation, Defamation, Breach of Statutory Duty, Misfeasance in Public Office, Crown Liability, Crown Immunity, Family Law, Custody and Access, Child Protection, Crown Wardship, Civil Procedure, Limitation Periods, Summary Judgment, Youth and Family Services Act, 2017, ss. 87(8), 87(9), 142(3), Rules of Civil Procedure, Rule 20, Limitations Act, 2002, S.O. 2002, c.24, Ministry of the Attorney General Act, R.S.O. 1990, c. M.17, s 8, Canadian Charter of Rights and Freedoms, Catholic Children’s Aid Society of Toronto v. A.M.Y., 2013 ONCJ 585, CCAS Toronto v. AMY and PY, 2014 ONSC 6526, Catholic Children’s Aid Society of Toronto v. A.Y., 2015 ONCA 493, A.Y. v. Catholic Children’s Aid Society of Toronto, [2015] S.C.C.A. No. 415, Hryniak v. Mauldin, 2014 SCC 7, Hinse v. Canada (Attorney General), 2015 SCC 35, Miazga v. Kvello Estate, 2009 SCC 51

Kawaguchi v. Kawa Investments Inc., 2021 ONCA 770

Keywords: Civil Procedure, Close of Pleadings, Discontinuance, Summary Judgment, Abuse of Process, Substantial Indemnity Costs, Rules of Civil Procedure, Rule 1.04, 23.01(1), 24.01, 25.05, 26.02(a), 29.08(1), 29.1.03(2), 31.04(1), 47.01, 48.01, and 76.03(1), Holterman v. Fish, 2017 ONCA 769, Angelopoulos v. Angelopoulos (1986), 55 O.R. (2d) 101, Toronto (City) v. Abasi, 1990 CarswellOnt 2289, Glasjam Investments Ltd. v. Freeman, 2014 ONSC 3878, Smith v. Dueck, 1997 CarswellBC 792, De Shazo v. Nations Energy Co., 2006 ABCA 400, DLC Holdings Corp. v. Payne, 2021 BCCA 31, Fox v. Star Newspaper Company, [1898] 1 Q.B. 636, Schlund v. Foster (1908), 11 O.W.R. 175, Blum v. Blum, [1965] 1 O.R. 236, Hennig v. Northern Heights (Sault) Ltd. (1980), 30 O.R. (2d) 346, Sampson v. City of Kingston, 1981 CarswellOnt 2747, Hamilton v. Open Window Bakery Ltd., 2004 SCC 9

Short Civil Decisions

A v. A, 2021 ONCA 748

Keywords: Family Law, Divorce, Divorce Act, R.S.C. 1985, c. 3 (2nd Supp.), s. 22

Elguindy v. Elguindy, 2021 ONCA 768

Keywords: Civil Procedure, Appeals, Extension of Time, Orders, Setting Aside, Rules of Civil Procedure, Rule 59.06, Elguindy v. Elguindy, 2020 ONCA 739, Antique Treasures of the World Inc. v. Bauer, 2003 CanLII 35349 (Ont. C.A.), Mehedi v. 2057161 Ontario Inc., 2015 ONCA 670

Bobel v. Humecka, 2021 ONCA 757

Keywords: Civil Procedure, Appeals, Extension of Time, Enbridge Gas Distribution Inc. v. Froese, 2013 ONCA 131

Kerner v. Information Builders (Canada) Inc., 2021 ONCA 756

Keywords: Employment, Wrongful Dismissal, Damages, Holland v. Hostopia.Com Inc., 2015 ONCA 762

N. v. F., 2021 ONCA 766

Keywords: Costs


CIVIL DECISIONS

Bodnar v. Boban Estate, 2021 ONCA 746

[Strathy C.J.O., Zarnett J.A. and Wilton-Siegal J. (ad hoc)]

Counsel:

M. Cupello, for the appellant
N.J. Gerry, for the respondent

Keywords: Contracts, Debtor-Creditor, Real Property, Mortgages, Defences, Laches, Civil Procedure, Summary Judgment, Issue Estoppel, Cause of Action Estoppel, Abuse of Process, Appeals, New Issues on Appeal, Statute of Frauds, R.S.O. 1990, c. S.19, Kaiman v. Graham, 2009 ONCA 77, Ontario Energy Savings L.P. v. 767269 Ontario Ltd., 2008 ONCA 350, Ross v. Ross (1999), 1999 NSCA 162 (CanLII), 181 N.S.R. (2d) 22 (C.A.)

facts:

In 1991, P.B. loaned the appellant $86,933 subject to 14% interest secured by a mortgage against the appellant’s house. The mortgage contemplated monthly payments fixed at $1,100 and was payable on the second anniversary. It was not repaid on that date and remained outstanding. P.B. passed away in 1997. The respondent, P.B.’s estate, asserted that the terms of the original mortgage were extended unamended every three years commencing in 1993.

The appellant alleged that P.B. had agreed that the mortgage would be renewed every three years at an interest rate of prime plus 4%. She also alleged that the respondent agreed to an increase in monthly payments to $1,600 in consideration of continuation of the alleged interest rate of prime plus 4%.

In 2017, the appellant sold the home. In 2018, the appellant commenced an action seeking a declaration that the mortgage had been paid in full and that she was entitled to the proceeds of the sale of house. The respondent alleged that the mortgage remained outstanding and counterclaimed for the amount it calculated to be outstanding plus continuing interest at 14%.

In 2020, summary judgment was granted in favour of the respondent. The motion judge held that there was no triable issue regarding the existence of an oral agreement that interest was to accrue at prime plus 4%. The motion judge also held that there was no triable issue regarding the alleged acts of part performance that would preclude the operation of the Statute of Frauds if any evidence existed of the alleged oral agreement. In reaching this conclusion, the motion judge also rejected the appellant’s assertion that promissory estoppel operated. The appellant appealed the summary judgment.

issues:

(1) Did the respondent agree to limit its remedies on default to foreclosure?

(2) Did the motion judge err in failing to consider the application of the doctrines of issue estoppel, cause of action estoppel and abuse of process?

(3) Did the motion judge fail to apply the doctrine of laches in respect of the defendant’s failure to proceed with foreclosure proceedings?

(4) Did the motion judge make a palpable and overriding error in inferring that the payments of $1,100 and $1,600 were sufficient to eventually pay off the mortgage.

holding:

Appeal dismissed.

reasoning:

(1) No.

The Court found that there was no evidence supporting the view that the respondent agreed it would foreclose if the appellant defaulted in making payments, much less that it would limit its remedies to foreclosure. Thus, no purpose would be served by ordering a trial of this issue.

(2) , (3) & (4)

The Court found that none of these arguments had been set out in the appellant’s pleadings nor had they been argued before the motion judge. As per Kaiman v. Graham, new arguments can only be raised with leave of the court. The decision of whether to grant leave is discretionary, and is to be guided by balancing the interests of justice. The general rule is that appellate court will not entertain entirely new issues on appeal.
The Court found that it would be contrary to the interests of justice to entertain arguments (2) and (3). No explanation was provided for the appellant’s failure to raise these arguments before the motion judge. The Court will not grant leave in the absence of a reasonable explanation where, as in this case, the respondent may be prejudiced by an inability to adduce evidence that would address these new arguments.
With respect to argument (4), the Court did not read the motion judge to be drawing an inference of fact regarding the financial significance of the mortgage payments. The Court also found that there was not any material significance to the alleged inference for the motion judge’s determination that the alleged oral agreement respecting interest did not occur.


Echelon Environmental Inc. v. Glassdoor Inc., 2021 ONCA 763

[Miller J.A. (Motion Judge)]

Counsel:

J. Lefebvre, for the moving party

C. L. Lonsdale, for the responding parties, Echelon Environmental Inc. and R. R.

J. G. Colombo and A. V. Singh, for the responding party, Glassdoor Inc.

Keywords: Torts, Defamation, Civil Procedure, Anti-SLAPP, Appeals, Extension of Time, Standing, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 137.1(3), 2363523 Ontario Inc. v. Nowack, 2018 ONCA 286, Howard v. Martin, 2014 ONCA 309, Leighton v. Best, 2014 ONCA 667, Enbridge Gas Distribution Inc. v. Froese, 2013 ONCA 131, Monteith v. Monteith, 2010 ONCA 78, Cunningham v. Hutchings, 2017 ONCA 938, 40 Park Lane Circle v. Aiello, 2019 ONCA 451

facts:

An anonymous poster (John Doe) posted an online review of Echelon on the Glassdoor website. Echelon brought a defamation suit against Glassdoor and John Doe. Glassdoor took the position that John Doe’s post was expressional relating to a matter of public interest, and therefore protected by s. 137.1(3) of the Courts of Justice Act. Accordingly, Glassdoor brought an Anti-SLAPP motion to have Echelon’s action dismissed.

Counsel for John Doe advised of her intention to file a factum and make oral submissions on the Anti-SLAPP motion, to which Echelon objected. In an appearance before Dow J. on June 7, 2021, Dow J. noted that John Doe had not filed a Notice of Intent to Defend. Accordingly, he ruled that John Doe had no standing and could not be heard from in the Anti-SLAPP motion “subject to any formal, on the record appearance by counsel for John Doe and any step taken in the litigation as a result”. 30 days elapsed and no appeal was brought by John Doe.

On July 28, 2021, Pollak J. adjourned all matters related to the Anti-SLAPP motion to August 16, 2021, to be heard by Dow J. Subsequently, on August 13, 2021, John Doe brought this motion to extend the time to serve and file a Notice of Appeal from the order of Dow J. dated June 7, 2021, which denied his standing to appear as an anonymous party and make submissions on an Anti-SLAPP motion.

issues:

(1) Should John Doe be granted an extension to serve and file a Notice of Appeal?

holding:

Motion dismissed.

reasoning:

(1) No.

The court will extend the time to serve and file a Notice of Appeal if an extension is required by “the justice of the case”. Generally, the court will consider four factors. No single factor decides the outcome, all factors must be considered, and their bearing on what justice requires is context-specific.

i. Intention to Appeal

The Court held that Dow J.’s order was final on its face. Accordingly, it held nothing happened subsequently that could have caused Dow J.’s order to “crystalize” at a later date, as contended by John Doe’s counsel. Therefore, the Court concluded the actions of Doe, given the obviousness of the finality of Dow J.’s order, and the absence of any change of circumstances suggested that Doe had no intention to appeal until well after the time period had expired.

ii. The Length and Explanation for the Delay

The delay was 67 days, which the Court called “not long”. However, the Court noted John Doe’s explanation was weak, as his explanation rested on his misunderstanding as to whether Dow J.’s order was final.

iii. Prejudice to Responding Parties

The Court noted that generally only prejudice caused by the delay in filing a notice of appeal, not prejudice that could be caused by the outcome of the appeal, is considered. However, in this case, the Court held the two considerations merged and a proper account of the “justice of the case” required taking into account both considerations.

The Court held that had John Doe brought his appeal in a timely manner, the Anti-SLAPP motion would have been adjourned, or John Doe’s appeal expedited, so that the question of standing would have been resolved prior to the hearing of the Anti-SLAPP motion. However, because this did not occur, Echelon would have to litigate Glassdoor’s appeal of the Anti-SLAPP dismissal on its merits, while simultaneously litigating an appeal relating to John Doe’s standing. As a result, if Echelon prevailed against Glassdoor but John Doe was successful, the Anti-SLAPP motion would have to be heard again on a new record involving John Doe.

iv. Merits of the Appeal

John Doe argued that Dow J. made errors of law in (1) determining that John Doe had no standing, and (2) in providing insufficient reasons.
Regarding the first alleged error, Doe and Glassdoor argued that s. 137.1 serves to protect anonymous speech, and that part of protecting anonymous speech is keeping it anonymous in the context of a defamation action. However, the Court noted that it was not directed to any authority for the proposition that s. 137.1 modifies the general obligation that parties who wish to participate in litigation must identify themselves both to the Court and to those against whom they are asserting rights.

Regarding the second alleged error, although the court noted the reasons of the motion judge were brief and conclusory, the ruling the motion judge was asked to make was obvious.
The Court concluded that, on balance, the justice of the case did not require it to grant an extension of time to appeal.


Miragliotta v. Zanette, 2021 ONCA 764

[Strathy C.J.O., Zarnett J.A. and Wilton-Siegel J. (ad hoc)]

Counsel:

P. D. Monte, for the appellants

B. D. Moldave, for the respondents

Keywords: Civil Procedure, Orders, Enforcement, Injunctions, Undertakings in Damages

facts:

The appellants and the respondents own neighbouring development lands. They have been involved in litigation concerning the lands for more than 10 years.

A 2010 court order provided that the parties would enter into an APS under which the respondents would sell a small piece of land known as Block 7 to the appellants. It also provided that the respondents would be responsible for, among other things, completing the final coat of asphalt on a roadway known as the Appian Way by August 31, 2013, and for completing the final curbs for Block 7.

The respondents did not comply with the deadline in the 2010 order. After giving notice to the respondents of their intention to hold them responsible for the cost of doing so, the appellants did the work to complete the curbs and added the final coat of asphalt to the Appian Way in May 2014.

In August 2014, the respondents proposed a plan for their lands that involved creating, by severance, five building lots, two of which would have 50-foot frontages, rather than the 60 feet required under a city by-law. The respondents objected, and in October 2014, moved for an injunction, undertaking to be responsible for any damages flowing from the injunction.

In January 2015, an injunction was granted restraining the respondents from proceeding with the development of the two building lots of 50 feet. The injunction was set aside by a further order made on June 2, 2015, which the appellants appealed unsuccessfully. When the injunction was set aside, a reference was directed to determine the damages for which the appellants were responsible as a result of their undertaking.

issues:

(1) Did the trial judge err in the amount the appellants should pay as a result of their having undertaken to be responsible for damages caused by an interim injunction they obtained against the respondents?

(2) Did the trial judge err in the amount that should be awarded to the appellants for expenditures to perform work that the respondents were obliged to complete under the 2010 court order?

holding:

Appeal dismissed.

reasoning:

(1) No.

The appellants had a lending commitment at a lower interest rate, the injunction delayed its finalization, and the respondents were only able to finalize their loan transaction at a higher rate while the injunction was in effect. The interest rate differential damages determined by the trial judge that flowed from the injunction were based on what the trial judge found had actually occurred, not what the respondents’ lender should have committed to in the circumstances.

(2) No.

The trial judge’s interpretation of the terms of the 2010 order (which the appellants themselves stressed was made on consent and was akin to a contract) was entitled to deference. The trial judge’s comparison of what the appellants spent relative to what was required of the respondents under the 2010 court order was also entitled to deference, as that was a matter with a heavily factual component. The Court saw no error in the trial judge’s conclusions.


Cavanaugh v. Grenville Christian College, 2021 ONCA 755

[Juriansz, van Rensburg and Sossin JJ.A.]

Counsel:

P.J. Pape and D.G. Boghosian, for the appellants

L. Merritt and S. Lombardi, for the respondents

Keywords: Torts, Systemic Negligence, Breach of Fiduciary Duty, Boarding Schools, Civil Procedure, Class Proceedings, Evidence, Experts, Whiten v. Pilot Insurance, 2002 SCC 18, Cavanaugh v. Grenville Christian College, 2012 ONSC 2995, affd 2013 ONCA 139, 360 D.L.R. (4th) 670, Cavanaugh v. Grenville Christian College, 2012 ONSC 2398, Cavanaugh v. Grenville Christian College, 2014 ONSC 290, Housen v. Nikolaisen, 2002 SCC 33, Carmichael v. GlaxoSmithKline Inc., 2020 ONCA 447, Rumley v. British Columbia, 2001 SCC 69

facts:

The respondents were the representative plaintiffs in a class (the “Class”) comprised of former boarding students that attended Grenville Christian College (the “School”) between 1973 and 1997 (the “Class Period”). The respondents brought a class action against the School and its former headmasters alleging abusive practices.

Five common issues were to be decided at trial: (1) Did the defendants owe a duty of care to the plaintiffs, (2) did the defendants breach the duty of care owed to the plaintiffs, (3) did the defendants owe fiduciary obligations to the plaintiffs, (4) did the defendants breach their fiduciary obligations to the plaintiffs, and did the conduct of the defendants merit an award of punitive damages?

The appellants admitted to common issues (1) and (3). The respondents asserted that there was systemic negligence in the operation of the School that resulted in foreseeable harm to the class. The respondents called evidence from two expert witnesses, Dr. P.A. (on the applicable standard of care for educational and disciplinary private schools in Ontario during the class period) and Dr. B (on the abuse of children, institutional abuse, maltreatment and trauma).

The trial judge ruled in favour of the respondents and concluded that there was systemic negligence on the part of the appellants, that the appellants had breached the duty of care owed to the Class members, that the appellants had breached their fiduciary duty owed to the Class members, and that punitive damages were appropriate.

The appellants appealed. The appellants asked that the judgment be set aside and the action be dismissed, or alternatively, that the matter be returned to the Superior Court for trial before another judge.

issues:

(1) Did the trial judge err in her use of Dr. B’s evidence to conclude that there had been a breach in the standard of care?

(2) Did the trial judge err in rejecting the defence evidence about the School’s operations?

(3) Did the trial judge err in finding that the appellants breached their fiduciary duty?

(4) Did the trial judge err in concluding that punitive damages were warranted?

holding:

Appeal dismissed.

reasoning:

(1) No.

Dr. B’s Use of 2016 and 2020 Documents

The appellants’ first argument was that the trial judge accepted Dr. B’s evidence about concepts of abuse and “total institutions” that were based on documents published long after the Class Period had ended. The appellants alleged that the trial judge misconstrued Dr. B’s evidence and overlooked the fact that she was testifying about modern concepts of abuse and harm. The appellants went so far as to argue that there was no evidence of foreseeable emotional harm during the Class Period.

The Court held that the trial judge did not misinterpret or misapply Dr. B’s evidence in concluding that the impugned practices at the School during the Class Period resulted in foreseeable emotional harm to students. Additionally, there was considerable other evidence to support the trial judge’s conclusion.

While the subject of changing perceptions of emotional harm was broached to some extent in Dr. B’s cross-examination, there was no admission that the conduct which constituted abuse and the emotional harm about which she testified would not have been recognized as such at any point during the Class Period. Nor, did the Court find any other evidence at trial to support the argument that the abuse about which Dr. B testified would not have constituted abuse during the class period.

The appellants also argued that the trial judge erred in finding a breach of the duty of care based on Dr. B’s characterization of the School as a “total institution”. The appellants argued that because the concept only came into being in 2000, there was no evidence that they ought to have known during the Class Period that they were running a “total institution”.

The Court found nothing wrong with the trial judge’s acceptance of the characterization of the School as a “total institution”. The Court also found no merit in the assertion that because the term had not been in use during the Class Period, the appellants could not have known they were operating as a “total institution” and therefore harm was not foreseeable. The conclusion that the School operated as a “total institution” did not lead directly to the conclusion that systemic negligence was established, nor did the trial judge reason that the appellants ought to have foreseen that they were running a total institution. Rather, as the trial judge stated, the risk that children in the care of total institutions may find themselves subject to “disconnection, degradation or powerlessness” formed part of her analysis in determining whether the boarding students during the Class Period were treated in a way that fell below the standard of care for students at that time.

Dr. B’s Definition of “Emotional Harm”

The appellants argued that the trial judge overlooked the fact that Dr. B “changed her evidence” and did not apply her own definition of abuse that required more than one “extreme incident”. The appellants alleged that the trial judge did not take into account the inconsistency in the expert’s own evidence and that, based on this misunderstanding about a “single incident” constituting abuse, the trial judge reasoned that abuse to one child was abuse to the Class.

The Court disagreed. The Court found that whether or not there was inconsistency with what she had written before, Dr. B’s evidence was clear. Further, the Court found that Dr. B carefully determined whether each of the impugned practices was systemic and resulted in systemic harm. The trial judge concluded that the practices, which were part of the “culture” of the School, aligned with its philosophy and embedded in its operational policies to enforce its norms, rules and expectations, were systemic.

(2) No.

The appellants submitted that the trial judge made a palpable and overriding error when she overlooked the defence evidence, and failed to assess the credibility of the defence witnesses. The appellants asserted that the trial judge made no findings against the credibility or reliability of the appellants’ witnesses, but she nonetheless ignored their evidence.

The Court disagreed. The trial judge made specific findings about the credibility and reliability of the evidence of the respondents’ witnesses because she was invited to do so by the appellants’ submissions. By contrast, the respondents did not impugn the credibility and reliability of the appellants’ witnesses.

The trial judge did not ignore the defence evidence in concluding that the School’s practices were abusive and harmful. She referred to evidence of individual defence witnesses throughout her reasons and noted that much of the evidence of the appellants’ witnesses was consistent with that of the respondent’s witnesses. The trial judge further observed that the areas of disagreement between the lay witnesses for each side fell into areas of individual experience and perception.

(3) No.

The trial judge concluded on the basis of the record before her that the appellants had breached their fiduciary duty to the Class members. The Court found that these conclusions were open to the trial judge on the evidence.

(4) No.

The appellants submitted that the trial judge’s finding of a “class-wide marked departure from the standard of care” was tainted by the errors in her systemic negligence analysis. Having found no error in the systemic negligence analysis, the Court concluded that this ground of appeal could not succeed.


McFlow Capital Corp v. James, 2021 ONCA 753

[Rouleau, Hoy and Thorburn JJ.A.]

Counsel:

T. B. Rotenberg and R. Das, for the appellants/respondents by way of cross-appeal
H. Book and S. Del Frate, for the respondents/appellants by way of cross-appeal

Keywords: Real Property, Condominiums, Oppression, Remedies, Punitive Damages, Civil Procedure, Substantial Indemnity Costs, Prejudgment Interest, Limitations Act, 2002, S.O. 2002 c.24, s. 5(1), Courts of Justice Act, R.S.O. 1990, c. C.43, s. 128, Condominium Act 1998, S.O. 1998, c. 19, Section 135, Grant Thornton LLP v. New Brunswick, 2021 SCC 31, Gordon Dunk Farms Limited v. HFH Inc., 2021 ONCA 681, Whiten v. Pilot Insurance Co., 2002 SCC 18, Richard v. Time Inc., 2012 SCC 8, Cinar Corporation v. Robinson, 2013 SCC 73, Sliwinski v. Marks (2006), 211 O.A.C. 215, Gary Anthony Bennett Professional Corporation v. Triella Corp., 2019 ONCA 225, Brad-Jay Investments Limited v. Village Developments Limited (2006), 218 O.A.C 315, Hamilton v. Open Window Bakery Ltd., 2004 SCC 9 , Duong v. NN Life Insurance Co. of Canada (2001) 141 O.A.C. 307, Metropolitan Toronto Police Widows & Orphans Fund v. Telus Communications Inc. (2008), 44 B.LR. (4th), Bank of America Canada v. Mutual Trust Co., 2002 SCC 43

facts:

The appeal was by the appellants (defendants), K.J., and in his capacity as trustee for L. M., R.C., and the Estate of K. M. and R. C. The respondents, McFlow Capital Corporation (“McFlow”), Premium Properties Ltd., and M. W. cross-appealed the trial judge’s award of pre-judgement interest.

The claim involved a condominium corporation called SCC 27. The appellant, J.J. was the lawyer for both SCC 27 and the first and second mortgagees for 30 of the 44 units. The trial judge held that K.J. held a beneficial interest in the mortgages on the majority units in SCC 27 and was able to control SCC 27, himself or through two offshore accounts that were K.J.’s alter egos. The appellant, R.C., was the bookkeeper and office manager of K.J.’s law firm, a director of SCC 27 and K.J.’s friend and housemate. The respondent McFlow was the mortgagee of the remaining 14 units in SCC 27, which were owned by 1652030 Ontario Limited.

In 2008, SCC 27 issued a special assessment on all the units in the complex. The trial judge found the amount was set high enough that the minority unit owner would not be able to pay the sum and would be forced into default. Notices of Sale under lien were issued by SCC 27 only for the minority units, even though the majority units had also not paid the 2018 special assessment.

In 2019, McFlow, commenced an application for oppression against SCC 27 and K.J. In May 2009, the court appointed an administrator to manage SCC 27’s affairs. The administrator listed the minority units for sale for which K.J. offered to purchase the minority units and three other units for $10,000, which the administrator refused. The administrator then listed all the units for sale and the court approved the sale which was completed in August 2013. The appellants counterclaimed against McFlow, Premium and M.W. for oppression.

The trial judge concluded that K.J.’s actions were intended to force out McFlow’s interest in the minority units. She accepted that McFlow had not done enough due diligence before advancing and increasing loans on the mortgages on the minority units but held that McFlow was nonetheless entitled to damages for oppression from K.J. and R.C. She also granted judgment for conspiracy against R.C. and the alter egos on the basis that K.J. was the directing mind of them and used them to execute his scheme to injure McFlow. The trial judge dismissed the appellant’s argument that McFlow’s claims were statute-barred by the expiry of the limitation period. The trial judge ordered the appellants to pay McFlow damages in the amount of $413,595.27 and prejudgment interest of $141,199.14, calculated at the rate of 1.3 percent per annum, as provided for in the Courts of Justice Act, which was the interest rate when the action was commenced. She also ordered punitive damages in the amount of $100,000, and post-judgment interest calculated at the rate of 3% commencing on January 20, 2020. She further ordered the appellants to pay substantial indemnity costs to McFlow, bearing 2% interest, commencing on October 9, 2020.

issues:

(1) Did the trial judge err in concluding that the claims against R.C. were not statute-barred?

(2) Did the trial judge err in awarding punitive damages against R.C.?

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

(4) Did the trial judge err in awarding prejudgment interest at the Court of Justice Act rate rather than the mortgage rate?

holding:

Appeal and cross-appeal dismissed.

reasoning:

(1) No.

A claim is discovered on the earlier of the day on which a party knew or ought to have known (i) that the injury, loss or damage had occurred, (ii) that it was caused by an act or omission of the person against whom the claim is made, and (iii) that a proceeding would be the appropriate means to seek to remedy it, or that a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of these matters. This ground of appeal failed. It was not until 2013 that McFlow knew or could have known by the exercise of reasonable due diligence, that R.C. was a beneficiary of the trust, which K.J. claimed held the beneficial interest in the majority units, and that after K.M.’s death, she was purportedly instructing K.J. Any claim in oppression or conspiracy brought before that would have been founded on mere suspicion or speculation, which is not sufficient to draw a plausible inference of liability.

(2) No.

The appellants alleged that the only explanation for the trial judge awarding punitive damages was because of R.C.’s role in failing to have the $2 million GIC paid into court. The question was whether the defendant’s conduct was so outrageous that punitive damages were rationally required for deterrence. Trial courts have latitude in determining punitive damages, provided the amount serves a rational purpose, namely prevention, deterrence and denunciation. The appeal on this ground failed because the award was rationally connected to the policy objectives of deterrence and denunciation and there were adequate grounds to support the decision to impose punitive damages.

(3) No.

The trial judge considered the appellant’s argument that an award of substantial indemnity costs would be “unnecessary double judicial admonishment” but distinguished the facts against that of the supporting case: Sliwinski. The Court found no error in the trial judge’s exercise of her discretion to award substantial indemnity costs on the basis of her findings of fact which were supported by evidence.

(4) No.


P.Y. v. Ontario (Attorney General), 2021 ONCA 761

[Benotto, Huscroft and Thorburn JJ.A.]

Counsel:

P.Y. and A.Y., acting in person

D. Polla, for the respondents The Attorney General of Ontario and L.G

G. Thomson, for the respondents Toronto Police Services Board, The Police Chief W.B., Police Constable L.A.W, and Police Constable S.D.

Keywords: Torts, False Arrest, False Imprisonment, Malicious Prosecution, Charter Breaches, Negligent Investigation, Defamation, Breach of Statutory Duty, Misfeasance in Public Office, Crown Liability, Crown Immunity, Family Law, Custody and Access, Child Protection, Crown Wardship, Civil Procedure, Limitation Periods, Summary Judgment, Youth and Family Services Act, 2017, ss. 87(8), 87(9), 142(3), Rules of Civil Procedure, Rule 20, Limitations Act, 2002, S.O. 2002, c.24, Ministry of the Attorney General Act, R.S.O. 1990, c. M.17, s 8, Canadian Charter of Rights and Freedoms, Catholic Children’s Aid Society of Toronto v. A.M.Y., 2013 ONCJ 585, CCAS Toronto v. AMY and PY, 2014 ONSC 6526, Catholic Children’s Aid Society of Toronto v. A.Y., 2015 ONCA 493, A.Y. v. Catholic Children’s Aid Society of Toronto, [2015] S.C.C.A. No. 415, Hryniak v. Mauldin, 2014 SCC 7, Hinse v. Canada (Attorney General), 2015 SCC 35, Miazga v. Kvello Estate, 2009 SCC 51

facts:

In 2011, P.Y. (the father) and A.Y. (the mother) were criminally charged with thirteen counts relating to the alleged abuse of their four children. After a preliminary inquiry, it was determined that the parents would stand trial on seven of the thirteen charges. All four children were removed from their parents’ care by the Catholic Children’s Aid Society (“CCAS”) and became Crown wards. A different Crown Attorney was assigned the case and charges were withdrawn, in part, because two of the children were reluctant to testify and see their parents in court.

P.Y. and A.Y. sued the Attorney General of Ontario, L.G. who was the Assistant Crown Attorney originally assigned to prosecute the case, the CCAS, the Crown, the Toronto Police Services Board (“TPSB”), former Police Chief W.B., Officer L.A.W, and Officer S.D.

The respondents brought a successful motion for summary judgment and the action was dismissed. The motion judge concluded the following. First, the claims against the police defendants for false arrest, false imprisonment, negligence, negligent investigation, and breaches of the Charter could not succeed because no liability flows to the TPSB or to Police Chief based on the actions of individual officers and because there was no evidence of improper or negligent supervision. Second, the claims against the police defendants were barred by the Limitations Act, 2002, as they were outside the two-year limitation period. Third, even if the claims were not time-barred, there were reasonable and probable grounds for investigating, arresting, and charging the parents. Fourth, with respect to the claims against the Attorney General for malicious prosecution and malfeasance in public office, the Attorney General was the proper defendant. Lastly, the motion judge found that Crown counsel relied on the evidence in good faith, and that there was enough evidence with which to prosecute.

issues:

(1) Did the motion judge err in finding summary judgment appropriate under the circumstances?

(2) Did the motion judge err in finding the action barred by the Limitations Act, 2002?

(3) Did the motion judge err in finding there was no malicious prosecution and obstruction of justice, and by finding reasonable and probable grounds for arrest, imprisonment, investigation, and prosecution?

(4) Did the motion judge err in finding immunity for the Crown prosecutor on constitutional grounds?

holding:

Appeal dismissed.

reasoning:

(1) No.

The motion judge correctly applied the test in Hryniak v. Mauldin. Summary judgment may be granted “when the process (1) allows the judge to make the necessary findings of fact, (2) allows the judge to apply the law to the facts, and (3) is a proportionate, more expeditious and less expensive means to achieve a just result.” The purpose of a summary judgment motion is to determine claims expediently and justly; a full trial was not necessary to reach this result.

The motion judge was afforded deference in exercising his discretion to determine that he could fairly decide by summary judgment. The Court saw no unfairness in this process.

(2) No.

The last day on which a discoverable claim arose against the police defendants for false arrest and imprisonment was at the time of the appellants’ arrest and imprisonment in November 2011. For negligence and negligent investigation, the latest date for discoverability was when the last charge was added in April 2013. The same limitation applied to the Charter claims. The Statement of Claim was not issued until June 2016, which was too late. The motion judge made no error in this regard.

(3) No.

There is a high standard to find malicious prosecution. There must be no reasonable and probable cause for the prosecution and the prosecution must be motivated by malice. Miazga v. Kvello Estate sets out the principle “that the reasonable and probable cause inquiry comprises both a subjective and an objective component” such that the prosecutors must have an actual belief that is reasonable in the circumstances. The motion judge found that there was reasonable and probable cause to initiate the prosecution and deference should be afforded to the motion judge’s determination. Further, the Officers stated in their affidavit that they believed that there were reasonable and probable grounds for arrest. This satisfied the subjective element. The evidence, including information provided by the children, confirmed that there were objectively reasonable grounds to arrest P.Y. and A.Y. and lay charges against them.

At any rate, the prosecution had adequate evidence to prosecute. There was no basis to interfere with the motion judge’s determination. There was no evidence of malicious intent on the part of the prosecutor or undue pressure by the CCAS.

(4) No.

Section 8 of the Ministry of the Attorney General Act provides that Crown prosecutors are personally immune from acts performed in their duty as a Crown attorney. Such immunity is not a constitutional violation, as the Attorney General stands in as the defendant who may be held accountable if there is an action that properly can be brought against the Crown attorney. The motion judge correctly determined that there was no genuine issue requiring trial against Crown prosecutor L.G.


Kawaguchi v. Kawa Investments Inc., 2021 ONCA 770

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

Counsel:

S. Choi and A. Beyhum, for the appellants

Tighe and A. Husa, for the respondents

Keywords: Civil Procedure, Close of Pleadings, Discontinuance, Summary Judgment, Abuse of Process, Substantial Indemnity Costs, Rules of Civil Procedure, Rule 1.04, 23.01(1), 24.01, 25.05, 26.02(a), 29.08(1), 29.1.03(2), 31.04(1), 47.01, 48.01, and 76.03(1), Holterman v. Fish, 2017 ONCA 769, Angelopoulos v. Angelopoulos (1986), 55 O.R. (2d) 101, Toronto (City) v. Abasi, 1990 CarswellOnt 2289, Glasjam Investments Ltd. v. Freeman, 2014 ONSC 3878, Smith v. Dueck, 1997 CarswellBC 792, De Shazo v. Nations Energy Co., 2006 ABCA 400, DLC Holdings Corp. v. Payne, 2021 BCCA 31, Fox v. Star Newspaper Company, [1898] 1 Q.B. 636, Schlund v. Foster (1908), 11 O.W.R. 175, Blum v. Blum, [1965] 1 O.R. 236, Hennig v. Northern Heights (Sault) Ltd. (1980), 30 O.R. (2d) 346, Sampson v. City of Kingston, 1981 CarswellOnt 2747, Hamilton v. Open Window Bakery Ltd., 2004 SCC 9

facts:

In their action for breach of contract against the respondents (and other defendants), the appellants moved for an interim injunction. The judge who heard the injunction motion indicated she viewed the action as having little or no merit against the respondents.

Following the injunction motion, the appellants refused to dismiss the action, and respondents’ advised they would be moving for summary judgment. In response, the appellants served a notice of discontinuance. Subsequently, the respondents brought a motion for a declaration that the appellants’ notice of discontinuance was invalid, and for summary judgment dismissing the action against them.

On that motion, the motion judge prevented the appellants from discontinuing their action against the respondents, three of the defendants in the action. He then granted the respondents’ motion for summary judgment, dismissing the action against them. The respondents appealed the motion judge’s decision.

issues:

(1) Did the motion judge err in law by finding that the appellants were not entitled to discontinue the action against the respondents because pleadings were closed within the meaning of Rule 25.05?

(2) Did the motion judge err by setting aside the notice of discontinuance as an abuse of process?

(3) Did the motion judge err by granting summary judgment?

(4) Did the motion judge err by finding an abuse of process that justified an award of substantial indemnity costs?

holding:

Appeal dismissed.

reasoning:

(1) Yes.

The Court held the motion judge erred in law by interpreting subrule 25.05(a) to mean that pleadings close against each defendant separately. Specifically, the Court saw no ambiguity in the wording of Rule 25.05 which outlined that for pleadings to be closed, the rule requires that the plaintiff reply to every defence or that the time to reply has expired, and that every defendant who has not defended has been noted in default.

The Court concluded that the reference to “every” defence and “every” defendant made it clear that in a multi-defendant action, in order for pleadings to be closed in that action, they must be closed against all defendants.

Accordingly, although the time for delivering a reply had passed in respect of the respondents, the time for delivering a reply to the late-filed joint statement of defence and counterclaim of L. K. and Kawa (other defendants to the action) had not yet passed, and they had not been noted in default. Therefore, pleadings in the action were not closed and the appellants were entitled to serve a notice of discontinuance.

(2) No.

The Court referenced the case of Angelopoulos v. Angelopoulos, where a motion judge set aside a notice of discontinuance as an abuse of process under Rule 10.04. The Court held that, in its view, the motion judge in this case was entitled to exercise the same jurisdiction under Rule 1.04 as the motion judge did in Angelopoulos.

The Court outlined that the appellants were unhappy with the result of the injunction motion that found their claim against the respondents had little or no merit. Subsequently, after being faced with the respondents’ indication they intended to move for summary judgment, the appellants sought to be free to not pursue their claim against the respondents for the time-being, but to be able to recommence the same proceeding on the same facts at a later time. The Court concluded that, in those circumstances, the motion judge was entitled to conclude the notice of discontinuance constituted an abusive use of the Rules.

The Court noted there is case law that demonstrates that in some circumstances, particularly where there are judicial orders or findings in an action (such as in this case), a Court may find it to be an abuse of process for the plaintiff to seek to discontinue the action and to be able to recommence the same action, against the same defendant, on the same facts. Accordingly, the Court saw no error in the motion judge’s decision to exercise his jurisdiction under Rule 1.04 to set aside the notice of discontinuance as an abuse of process.

(3) No.

The appellant’s position was that there was a genuine issue requiring a trial as they alleged the respondents should have done more due diligence into the authority of one of the defendants to enter into a listing agreement.

The Court noted the problem with the appellant’s position was that the appellant was complicit in the respondents’ attempts to market the property, and never told the respondents they had any objections to the authority of the defendant to enter into the listing agreement. Further, the sole issue submitted to the motion judge as requiring a trial was an alleged conflict in the evidence of a witness, which the motion judge rejected as a conflict.

Accordingly, the Court saw no basis to interfere with the motion judge’s decision to grant summary judgment.

(4) No.

The Court noted a deferential standard applies to appellate review of a discretionary costs award, unless it is based on an error in principle or is clearly wrong.

The motion judge’s decision to award substantial indemnity costs was based on his finding of abuse of process in both commencing the action against the respondents, and in resisting a summary dismissal, given the facts and circumstances that were identified by the judge on the injunction motion.

Accordingly, given the motion judge’s reasoning, the Court saw no basis to interfere with the decision of the motion judge on costs.


SHORT CIVIL DECISIONS

A v. A, 2021 ONCA 748

[Feldman, Pepall and Tulloch JJ.A.]

Counsel:

I. A., acting in person

I. Yushchenko, for the respondent

Keywords: Family Law, Divorce, Divorce Act, R.S.C. 1985, c. 3 (2nd Supp.), s. 22

Elguindy v. Elguindy, 2021 ONCA 768

[Strathy C.J.O., Zarnett J.A. and Wilton-Siegel J. (ad hoc)]

Parties:

A. E., acting in person

M. Bates, for the responding party

Keywords: Civil Procedure, Appeals, Extension of Time, Orders, Setting Aside, Rules of Civil Procedure, Rule 59.06, Elguindy v. Elguindy, 2020 ONCA 739, Antique Treasures of the World Inc. v. Bauer, 2003 CanLII 35349 (Ont. C.A.), Mehedi v. 2057161 Ontario Inc., 2015 ONCA 670

Bobel v. Humecka, 2021 ONCA 757

[Strathy C.J.O., Zarnett J.A. and Wilton-Siegel J. (ad hoc)]

Counsel:

P. B., acting in person

A. Boissonneau-Lehner, for the responding parties

Keywords: Civil Procedure, Appeals, Extension of Time, Enbridge Gas Distribution Inc. v. Froese, 2013 ONCA 131

Kerner v. Information Builders (Canada) Inc., 2021 ONCA 756

[Strathy C.J.O., Zarnett J.A. and Wilton-Siegel J. (ad hoc)]

Counsel:

H. Nieuwland, for the appellant
P. R. White and J. Wong, for the respondent

Keywords:Employment, Wrongful Dismissal, Damages, Holland v. Hostopia.Com Inc., 2015 ONCA 762

N. v. F., 2021 ONCA 766

[Lauwers, Hourigan and Brown JJ.A.]

Counsel:

F. L. Jamal, F. Yehia and E. C. Conway, for the appellant

B. R.G. Smith, L. Love-Forester and A. Lokan, for the respondent

E. Garfin and H. Evans, for the intervener Attorney General of Ontario

Caterina E. Tempesta and S. Scott, for the intervener Office of the Children’s Lawyer

Keywords: Costs


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.