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Following are this week’s summaries of the Court of Appeal for Ontario for the week of April 4, 2022.

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Topics covered this week included striking pleadings as disclosing no reasonable cause of action against CRA to recover the costs and interest incurred in respect of a successful tax appeal, a landlord’s refusal to consent to an assignment of a lease, adverse possession, family law (variation of support and parenting) and security for costs in a defamation case.

John Polyzogopoulos
Blaney McMurtry LLP
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Table of Contents

Civil Decisions

Tabriz Persian Cuisine Inc. v. Highrise Property Group Inc., 2022 ONCA 272

Keywords: Contracts, Real Property, Commercial Leases, Assignments, Landlord’s Consent, Reasonableness, 1455202 Ontario Inc. v. Welbow Holdings Ltd. (2003), 33 B.L.R. (3d) 163 (Ont. S.C.), Housen v. Nikolaisen, 2002 SCC 33, Royal Bank of Canada v. Oxford Medical Inc., 2019 ONSC 1020, Royal Bank cites St. Jane Plaza Ltd. v. Sunoco Inc. (1992), 24 R.P.R. (2d) 161 (Ont. C.J. (Gen. Div.)), 1497777 Ontario Inc. v. Leon’s Furniture Ltd. (2003), 176 O.A.C. 380 (C.A.), Lehndorff Canadian Pension Properties Ltd. v. Davis Management Ltd. (1989), 59 D.L.R. (4th) 1 (B.C. C.A.), Tradedge Inc. (Shoeless Joe’s) v. Tri-Novo Group Inc., 2007 ONCA 562, Federal Business Development Bank v. Starr (1986), 28 D.L.R. (4th) 582, No. 1 West India Quay (Residential) Ltd. v. East Tower Apartments Ltd., [2018] EWCA Civ 250

Billimoria v. Mistry , 2022 ONCA 276

Keywords: Real Property, Adverse Possession, Partition and Sale, Civil Procedure, Appeals, New Issue on Appeal, Real Property Limitations Act, RSO 1990, c L15, ss. 4, 5 and 15, Land Titles Act, RSO 1990, c L5, s. 51, Partition Act, RSO 1990, c P4, s. 2, Cavanaugh v. Grenville Christian College, 2013 ONCA 139, Housen v. Nikolaisen, 2002 SCC 33, H.L. v. Canada (Attorney General), 2005 SCC 25, Whitby (Town) v. G & G 878996 LM Ltd., 2020 ONCA 654, Kaiman v. Graham, 2009 ONCA 77, Vivekanandan v. Terzian, 2020 ONCA 110, Sipsas v. 1299781 Ontario Inc., 2017 ONCA 265, Teis v. Ancaster (Town) (1997), 35 O.R. (3d) 216 (C.A.), Brienza v. Brienza, 2014 ONSC 6942

Vale v. Vale, 2022 ONCA 278

Keywords: Family Law, Child Support, Variation, Civil Procedure, Orders, Interim or Final, Costs, Federal Child Support Guidelines, SOR/97-175 section 7, 3(1) and 10, Family Law Act, R.S.O. 1990, c. F.3 section 35, 37, 39.1, 56(1), Bouchard v. Sgovio, 2021 ONCA 709

Jayco Inc. v. Canada (Revenue Agency) , 2022 ONCA 277

Keywords: Tax Law, Torts, Crown Liability, Negligence, Duty of Care, Remoteness, Public Policy Considerations, Agency Law, Civil Procedure, Striking Pleadings, No Reasonable Cause of Action, Appeals, Standard of Review, Correctness, Rules of Civil Procedure, Rule 21.1(1)(b), Excise Tax Act, R.S.C., 1985, c. E-15, s. 221(1), Income Tax Act, R.S.C., 1985, c. 1, Quebec (Revenue) v. Caisse populaire Desjardins de Montmagny, 2009 SCC 49, R. v. Imperial Tobacco Canada Ltd., 2011 SCC 42, Hunt v. Carey Canada Inc., [1990] 2 S.C.R. 959, Reference re Goods and Services Tax, [1992] 2 S.C.R. 445, Re Statutes of Manitoba relating to Education (1894), 22 S.C.R. 577, Reference re Secession of Quebec, [1998] 2 S.C.R. 217, Cooper v. Hobart, 2001 SCC 79, [2001] 3 S.C.R. 537, Fullowka v. Pinkerton’s of Canada Ltd., 2010 SCC 5, Reference re Broome v. Prince Edward Island, 2010 SCC 11, Eliopoulos v. Ontario (Minister of Health & Long Term Care) (2006), 82 O.R. (3d) 321 (Ont. C.A.), River Valley Poultry Farm Ltd. v. Canada (Attorney General), 2009 ONCA 326, McCreight v. Canada (Attorney General), 2013 ONCA 483, Hill v. Hamilton‑Wentworth Regional Police Services Board, 2007 SCC 41, Leroux v. Canada Revenue Agency, 2012 BCCA 63, Grenon v. Canada Revenue Agency, 2017 ABCA 96, Odhavji Estate v. Woodhouse, 2003 SCC 69

A.C.V.P. v. A.M.P., 2022 ONCA 283

Keywords: Family Law, Decision Making, Parenting, Best Interests of the Child, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 112, Children’s Law Reform Act, R.S.O. 1990, c. C.12, s. 30, Palmer v. The Queen, [1980] 1 S.C.R. 759, Goldman v. Kudelya, 2017 ONCA 300, Children’s Aid Society of Owen Sound v. R.D. (2003), 178 O.A.C. 69 (C.A.), S. v. M.S., 2010 ONCA 196, Van de Perre v. Edwards, 2001 SCC 60, V.S.J. v. L.J.G. (2004), 5 R.F.L. (6th) 319, (Ont. S.C.), Merkand v. Merkand, 2006 CanLII 3888 (Ont. C.A.), leave to appeal refused, [2006] S.C.C.A. No. 117, Young v. Young, 2013 ONSC 4423, Kucan v. Santos, 2017 ONSC 6725, Children’s Aid Society of London and Middlesex v. B.(C.C.), 2007 CanLII 66699 (Ont. S.C.), Glick v. Cale, 2013 ONSC 893, A.A. v. D.S., 2022 ONSC 1389, Kramer v. Kramer (2003), 37 R.F.L. (5th) 381 (Ont. S.C.), Parniak v. Carter (2002), 30 R.F.L. (5th) 381 (Ont. C.J.); Glance v. Glance (2000), 10 R.F.L. (5th) 276 (Ont. S.C.)

Lavallee v. Isak, 2022 ONCA 290

Keywords: Torts, Defamation, Civil Procedure, Appeals, Security for Costs, Rules of Civil Procedure, Rules 61.06(1)(a) and (c), Grant v. Torstar, 2009 SCC 61, Yaiguaje v. Chevron Corporation, 2017 ONCA 827, Schmidt v. Toronto Dominion Bank (1995), 24 O.R. (3d) 1 (C.A.), Pickard v. London Police Services Board, 2010 ONCA 643, York University v. Markicevic, 2017 ONCA 651, Henderson v. Wright, 2016 ONCA 89, Heidari v. Naghshbandi, 2020 ONCA 757

Short Civil Decisions

Marshall v. Meirik, 2022 ONCA 275

Keywords: Contracts, Real Property, Agreements of Purchase and Sale of Land, Damages, Mitigation, Civil Procedure, Costs

X.H. v. Cota, 2022 ONCA 274

Keywords: Torts, Negligence, Civil Procedure, Summary Judgment, Striking Pleadings, Limitation Periods, Limitations Act, 2002, S.O. 2002 c. 24, Sch. B., s. 16, Jane Doe v. Weinstein, 2018 ONSC 1126

Goguen v. Baptiste, 2022 ONCA 284

Keywords: Civil Procedure, Mareva Injunctions, Jurisdiction, Chevron Corp. v. Yaiguaje, 2015 SCC 42

Rieder zu Wallburg v. Plista Gmbh, 2022 ONCA 281

Keywords: Contracts, Civil Procedure, Jurisdiction, Forum Non Conveniens, Costs, Club Resorts Ltd. v. Van Breda, 2012 SCC 17


CIVIL DECISIONS

Tabriz Persian Cuisine Inc. v. Highrise Property Group Inc., 2022 ONCA 272

[Feldman, MacPherson and Lauwers JJ.A.]

Counsel:

E. Mehrabi, for the appellant

A. Assuras, for the respondent

Keywords: Contracts, Real Property, Commercial Leases, Assignments, Landlord’s Consent, Reasonableness, 1455202 Ontario Inc. v. Welbow Holdings Ltd. (2003), 33 B.L.R. (3d) 163 (Ont. S.C.), Housen v. Nikolaisen, 2002 SCC 33, Royal Bank of Canada v. Oxford Medical Inc., 2019 ONSC 1020, Royal Bank cites St. Jane Plaza Ltd. v. Sunoco Inc. (1992), 24 R.P.R. (2d) 161 (Ont. C.J. (Gen. Div.)), 1497777 Ontario Inc. v. Leon’s Furniture Ltd. (2003), 176 O.A.C. 380 (C.A.), Lehndorff Canadian Pension Properties Ltd. v. Davis Management Ltd. (1989), 59 D.L.R. (4th) 1 (B.C. C.A.), Tradedge Inc. (Shoeless Joe’s) v. Tri-Novo Group Inc., 2007 ONCA 562, Federal Business Development Bank v. Starr (1986), 28 D.L.R. (4th) 582, No. 1 West India Quay (Residential) Ltd. v. East Tower Apartments Ltd., [2018] EWCA Civ 250

facts:

This appeal centered on the reasonableness of a landlord’s refusal to consent to a tenant’s lease assignment.

The appellant, Tabriz Persian Cuisine Inc., owned a Persian restaurant in premises leased from the respondent, Highrise Property Group Inc. In 2018, the appellant decided to sell its business, and, on three occasions, tried to assign its lease. Section 10.01 of the lease prohibited the respondent from unreasonably withholding or delaying its consent, and stated it would not be unreasonable for the respondent to consider the proposed transfer’s conformity with the lease, the assignee’s business fundamentals, and the availability of other premises. The respondent refused to consent to the assignment of its lease unless the appellant removed a patio it had built on the condominium’s property, and met a series of other conditions.

The appellant brought an action for damages after the third refusal. Akbarali J. found that the patio was the respondent’s primary reason for the refusal, and that the appellant had not shown that the respondent acted unreasonably. The appellant had built the patio outside the leased premises without the respondent’s consent. The appellant understood that the patio did not conform with the lease, and the respondent was merely insisting that the appellant restore the leased premises before it left. While, the respondent’s insistence that the appellant discontinue its parallel lawsuit was not reasonable, this collateral purpose did not render the respondent’s refusal unreasonable, viewed holistically.

issues:

(1) Did the trial judge err by finding that the respondent did not impose a pre-condition to considering the appellant’s assignment request?

(2) Did the trial judge err by finding that the respondent’s refusal to consent to the assignment was reasonable?

(3) Did the trial judge err by finding that the reasonable purpose saved the collateral purpose?

holding:

Appeal dismissed.

reasoning:

(1) No.

The landlord was not unreasonable in placing “preconditions” before considering the assignment of the lease. A landlord’s refusal to consider an offer for a lease assignment is not unreasonable in itself. It is unreasonable if the court is unable to appreciate the reasons motivating the refusal. A landlord’s silence is tantamount to an unreasonable refusal. The correspondence between the parties highlighted the basis of the landlord’s refusal in palpable detail and allowed the trial judge to find that the patio was the only default “that really mattered”.

(2) No.

Reasonableness is a question of fact, dependent on the surrounding circumstances, the commercial realities of the marketplace, and the economic impact of the assignment on the respondent. There was no basis to disturb the trial judge’s analysis and conclusion on this issue.

The appellant’s refusal to remove the patio had imposed economic loss on the respondent. This detriment was legitimately recognized as a reasonable objection to the assignment. The appellant acknowledged that the patio was contrary to the lease through its many unfulfilled promises to remove it. The appellant’s assurances that the purchaser of its business could use the patio showed that it never intended to rectify its breach. The respondent’s refusal was motivated by a desire to avoid “perpetuat[ing] the patio problem.”

The respondent’s insistence that the appellant rectify its breach fell squarely within the field of reasonableness. The respondent’s desire to compel the appellant to restore the integrity of the leased premises was entirely consistent with the parties’ bargain as expressed by the lease. The landlord’s obligation to withhold consent on reasonable grounds is unqualified: “which consent may not be unreasonably withheld or delayed.” Three provisions are included in a distinct sentence that states “it will not be considered unreasonable for the Landlord to take into account the following factors”. This language is expansive, not exclusive, and clarifies conditions that may be unreasonable without limiting the generality of the first clause.

(3) No.

There was a linkage between the respondent’s reasonable condition (remove the patio) and the improper collateral purpose (discontinue the parallel lawsuit). While the trial judge’s statement that “a reasonable basis to refuse consent saves a co-existing tainted purpose” was too broad a proposition, the collateral purpose did not “infect” the reasonable condition in this case. The respondent’s principal focus throughout its dispute with the appellant was the removal of the improper patio. The respondent had every right to seek the removal of the patio as a condition of agreeing to the assignment of the lease to a potential buyer. A reasonable person could have withheld consent on the basis that the appellant had not properly restored the property to the condition required by the lease, as it had promised to do.


Billimoria v. Mistry , 2022 ONCA 276

[Pardu, Paciocco and Thorburn JJ.A.]

Counsel:

M. S. Deverett, for the appellant

T. Evangelidis and E. Blay, for the respondents

Keywords: Real Property, Adverse Possession, Partition and Sale, Civil Procedure, Appeals, New Issue on Appeal, Real Property Limitations Act, RSO 1990, c L15, ss. 4, 5 and 15, Land Titles Act, RSO 1990, c L5, s. 51, Partition Act, RSO 1990, c P4, s. 2, Cavanaugh v. Grenville Christian College, 2013 ONCA 139, Housen v. Nikolaisen, 2002 SCC 33, H.L. v. Canada (Attorney General), 2005 SCC 25, Whitby (Town) v. G & G 878996 LM Ltd., 2020 ONCA 654, Kaiman v. Graham, 2009 ONCA 77, Vivekanandan v. Terzian, 2020 ONCA 110, Sipsas v. 1299781 Ontario Inc., 2017 ONCA 265, Teis v. Ancaster (Town) (1997), 35 O.R. (3d) 216 (C.A.), Brienza v. Brienza, 2014 ONSC 6942

facts:

The appeal arose from a dispute between two owners of a residential in Mississauga. At the summary trial, the appellant, H.M., sought a declaration that he was the sole owner of the property by virtue of ss. 4, 5, and 15 of the Real Property Limitations Act, R.S.O. 1980, c. L.15 (“RPLA”). The appellant pointed to his exclusive possession of the property for more than ten years, the fact that he paid expenses throughout, the respondents had not inspected the property for more than ten years and that the respondents had done nothing to protect their property interest for more than ten years. He denied that there was a verbal agreement allowing him to stay in the home in exchange for paying carrying costs, with the expectation that the property would eventually be sold. He said that this alleged verbal agreement was incomplete, missing essential terms, and unenforceable. The appellant commenced an action seeking a declaration that he was the sole owner of the property because he was in exclusive possession of it for more than ten years and paid the carrying costs. The respondents brought a counterclaim asking the property to be sold pursuant to the Partition Act.

The trial judge held that the appellant had not established exclusive possession of the property under the RPLA. The trial judge also dismissed the appellant’s claim of proprietary estoppel, as there was never an express or implied representation that the appellant was to become sole owner, and there was no basis to find that the respondent’s behaviour has been unconscionable. The trial judge held that the appellant had a 65% interest in the property, the respondents had a 35% interest in it, and that it should be sold.

issues:

(1) Does s. 51 of the Land Titles Act bar the appellant’s claim?

(2) Did the trial judge err in assessing the appellant’s actual possession of the property under the RPLA?

(3) Did the trial judge err in ordering the sale of the property pursuant to the Partition Act?

holding:

Appeal dismissed.

reasoning:

(1) See below.

The new issue the respondents raised on appeal, that s. 51 of the Land Titles Act bars the appellant’s claim, was properly before the court and was dispositive. While the effect of s. 51 of the Land Titles Act was not raised at trial by different counsel for the respondents, it was a legal issue which did not depend on findings of fact, nor was there any suggestion that prior counsel failed to raise it for tactical reasons or that the interests of justice weighed in favour of not considering it. Accordingly, and with the consent of the appellant, the respondents satisfied their burden and the court exercised its discretion to allow this issue to be raised on appeal. The property was already registered in Land Titles at the time it was purchased by the parties, and thus, the appellant could not have obtained title to it by adverse possession. The appellant could not make out a claim of adverse possession regardless of how long the appellant actually occupied the home.

(2) No.

The trial judge held that as a factual matter, the respondents never lost possession of the property, either by dispossession or discontinuance of possession. She held that the appellant therefore failed to meet his burden of showing that he had successfully dispossessed the respondents of their interest in the property or that the respondents had discontinued their possessory interest in the property such that their rights in the property were extinguished. There was no error in the conclusion that the appellant had failed to establish his claim under the RPLA.

(3) No.

Section 2 of the Partition Act provides that a joint tenant or tenant in common may be compelled to make partition or sale. The onus is on the party resisting sale to demonstrate reasons why it ought not to be sold. There must be malicious, vexatious or oppressive conduct to justify the refusal to sell. While the trial judge accepted that there was an agreement among the parties in 1991, she also accepted that, “there was an expectation on the [respondents’] part that the [appellant] would move into the property for a much shorter period than ended up happening. There was an expectation that the property would be sold much earlier.” Moreover, there was evidence that the agreement changed when the respondents discovered that they had been removed from title without being told, and steps had to be taken to rectify this.


Vale v. Vale , 2022 ONCA 278

[Pardu, Paciocco and Thorburn JJ.A.]

Counsel:

A. Towlson, for the appellant

C. Kim, for the respondent

D. McInnis, for the Office of the Children’s Lawyer

Keywords: Family Law, Child Support, Variation, Civil Procedure, Orders, Interim or Final, Costs, Federal Child Support Guidelines, SOR/97-175 section 7, 3(1) and 10, Family Law Act, R.S.O. 1990, c. F.3 section 35, 37, 39.1, 56(1), Bouchard v. Sgovio, 2021 ONCA 709

facts:

The parties had three children: Z, E, and N. The parties separated on December 9, 2016. The parties entered into a comprehensive separation agreement on December 12, 2018. The terms of the separation agreement were not incorporated into a final order in the divorce proceedings. In March 2020, E stopped staying with the appellant father and began living full time with the respondent mother. The respondent requested a change in child support to $1,244 per month because of the change in E’s residence. The respondent said because Z was an adult child and because of substantial s. 7 expenses for counseling, he wanted to “take a holistic approach to child support” and pay $1,000 per month instead of $1,244.

The motion judge made the following final orders:

1. The child E shall primarily reside with the respondent.
2. The appellant shall exercise access to E in accordance with E’s wishes.
3. Child support, commencing January 1, 2021, shall be in the guideline amount of $1,244 per month, payable by the appellant father to the respondent mother.
4. Child support arrears as of December 9, 2020 were set at $3,678, payable by the appellant to the respondent.
5. The respondent shall have the right to send medical receipts for the children directly to the father’s health insurance company and receive the reimbursement money directly.

The motion judge awarded costs to the respondent in the amount of $22,541.81.

issues:

(1) Did the motion judge err by varying support?

(2) Did the motion judge err in quantifying support?

(3) Did the motion judge lack jurisdiction to vary parenting time?

(4) Did the motion judge err in issuing a final order?

(5) Should leave to appeal costs be granted, and the appeal of costs be allowed?

holding:

Appeal allowed in part.

reasoning:

(1) No.

The respondent was not attempting to vary the provisions for child support contained in the separation agreement. She was attempting to enforce them. Contrary to the appellant’s arguments, a motion to change support was not required in these circumstances: Bouchard v. Sgovio, 2021 ONCA 709.

(2) No.

The preamble to the Family Law Act notes the need for the orderly and equitable settlement of the affairs of the spouses and the equitable sharing by parents of responsibility for their children. The motion judge had all the information he needed to decide the issues. No one asked for a trial of that issue or objected to the motion judge deciding it. Moreover, section 3(1) of the Child Support Guidelines provides that unless otherwise provided, the amount of an order for child support for children under the age of majority is the table amount plus s. 7 expenses.

(3) No.

The motion judge had jurisdiction to make an interim variation of custody on a motion brought in these proceedings, where the best interests of the child demanded it. No final order had been taken out in these proceedings. Section 56(1) of the Family Law Act provides that in the determination of a matter respecting parenting time with respect to a child, the court may disregard any provision of a domestic contract where in the opinion of the court, to do so is in the best interests of the child.

(4) Yes.

Having indicated that he would make the order on an interim basis, the motion judge erred in making it final. Procedural fairness was denied to the parties, who had no reason to believe that the finality of the order should be addressed during the hearing. The Court varied the motion judge’s order that “the child [E] shall be primarily a resident with the mother” and “[t]he father shall exercise access to E in accordance with her wishes” by adding “on an interim basis” to both of those aspects of the order.

(5) Yes.

The Court accepted that the award of costs in favour of the respondent may have been affected by the final nature of the disposition of parenting time for E. The Court granted leave to appeal costs and vary the costs awarded in favour of the mother by reducing it by $2,000 to $20,541.81.


Jayco Inc. v. Canada (Revenue Agency), 2022 ONCA 277

[Pardu, Paciocco and Thorburn JJ.A.]

Counsel:

D. Robertson, J. Ip and B. Rossler for the appellant

N. Arnold, K. Dias and B. Chamberland, for the respondents

Keywords: Tax Law, Torts, Crown Liability, Negligence, Duty of Care, Remoteness, Public Policy Considerations, Agency Law, Civil Procedure, Striking Pleadings, No Reasonable Cause of Action, Appeals, Standard of Review, Correctness, Rules of Civil Procedure, Rule 21.1(1)(b), Excise Tax Act, R.S.C., 1985, c. E-15, s. 221(1), Income Tax Act, R.S.C., 1985, c. 1, Quebec (Revenue) v. Caisse populaire Desjardins de Montmagny, 2009 SCC 49, R. v. Imperial Tobacco Canada Ltd., 2011 SCC 42, Hunt v. Carey Canada Inc., [1990] 2 S.C.R. 959, Reference re Goods and Services Tax, [1992] 2 S.C.R. 445, Re Statutes of Manitoba relating to Education (1894), 22 S.C.R. 577, Reference re Secession of Quebec, [1998] 2 S.C.R. 217, Cooper v. Hobart, 2001 SCC 79, [2001] 3 S.C.R. 537, Fullowka v. Pinkerton’s of Canada Ltd., 2010 SCC 5, Reference re Broome v. Prince Edward Island, 2010 SCC 11, Eliopoulos v. Ontario (Minister of Health & Long Term Care) (2006), 82 O.R. (3d) 321 (Ont. C.A.), River Valley Poultry Farm Ltd. v. Canada (Attorney General), 2009 ONCA 326, McCreight v. Canada (Attorney General), 2013 ONCA 483, Hill v. Hamilton‑Wentworth Regional Police Services Board, 2007 SCC 41, Leroux v. Canada Revenue Agency, 2012 BCCA 63, Grenon v. Canada Revenue Agency, 2017 ABCA 96, Odhavji Estate v. Woodhouse, 2003 SCC 69

facts:

Jayco, Inc. (“Jayco”) manufactures recreational vehicles in the United States and sells them to Canadian dealers. The CRA took the position that delivery occurred in Canada and that Jayco was obliged to and failed to collect and remit GST/HST from the dealers. It assessed Jayco for almost $14 million in taxes.

While Jayco was successful in having the assessment set aside, it incurred legal costs in contesting the assessment and interest charges on the security posted for taxes claimed pending appeal. Jayco brought an action for recovery of these expenses but it was struck pursuant to Rule 21.1(1)(b) of the Rules of Civil Procedure as disclosing no reasonable cause of action. Jayco appealed.

issues:

(1) Did the motion judge err in finding that the respondents, as principal, did not owe a duty to indemnify their agent (the appellant) for damages caused as a result of the agent following the principal’s instructions?

(2) Did the motion judge err in finding that the respondents did not owe a duty of care to GST/HST registrants who are appointed under the ETA to be agents of Her Majesty the Queen in right of Canada?

holding:

Appeal dismissed.

reasoning:

The standard of review was correctness, and the legal test for determining whether a claim should be struck under Rule 21.01(1)(b) is whether it is plain and obvious that the statement of claim discloses no reasonable cause of action, or put another way, that the claim has no reasonable prospect of success.

(1) No.

The appellant argued that s. 221(1) of the ETA, which requires a supplier to collect the tax payable by a recipient, made it an agent of the respondents when it carried out the instructions of the CRA to either pay or secure the taxed claimed.

The court determined that it was plain and obvious that this claim could not succeed. The court stated that in these circumstances, there was no question of express or implied contractual entitlement to reimbursement. There was no tortious liability to a third party which was the subject of a claim for indemnification. Section 221(1) of the ETA limits the agency to the “collection” of the tax from a recipient of a supply.

Both the ITA and the ETA rely on self-reporting by taxpayers. Those Acts establish administrative structures for the assessment and audit of taxpayers. When the CRA delivers a Notice of Assessment or Reassessment claiming that more taxes are owing and the taxpayer delivers a Notice of Objection, the parties are taking opposing positions. Under these circumstances, it cannot be said that the taxpayer is acting as agent of the tax authority when it incurs interest or legal costs in the course of asserting its position.

Interest paid to post security for the taxes claimed, and legal fees incurred to contest the assessment, are not incurred for the “collection” of the tax from a recipient of a supply.

In the face of the comprehensive statutory scheme providing for Notices of Objection, appeals to the Tax Court of Canada, judicial review and some remedies for overpayment, such as interest on refunds and awards of costs, the absence of statutory provisions for indemnification for other interest paid and other legal costs is telling. Section 221 does not provide a basis to infer a statutory entitlement to more costs and interest beyond that provided in the ETA and the Tax Court of Canada Act.

(2) No.

This issue turned on whether there is sufficient proximity between a taxpayer and the CRA to establish a prima facie duty of care. The relationship between the parties and broad questions of policy are relevant. The second stage of the inquiry asks whether there are residual policy considerations which should negate or limit that duty of care.

Where a statutory regulator is mandated to protect the public interest, the creation of a private law duty of care may conflict with the regulator’s public duties. In this case, the mandate of the CRA is to ensure that taxpayers pay taxes that are lawfully owed, for the benefit of all taxpayers and the country as a whole. The ETA establishes a comprehensive regime to deal with disputes over taxes owing, including appeals and judicial review. Recognition of a private law duty here would conflict with the agency’s duty to the public; there is nothing in the legislative scheme to suggest that such a duty was contemplated.

The Court stated that there are many instances where courts have held that broad statutory public duties foreclose a private law duty of care, and that such public duties do not generally, in and of themselves, give rise to private law duties of care. Further, the Court went on to state that there is nothing in the specific relationship between the appellant and the CRA to suggest that a finding of sufficient proximity would be appropriate. It is not sufficient that the CRA was ultimately shown to have been wrong to assess the appellant for the taxes it claimed.

Policy reasons also favour rejection of a private law duty of care in relation to administrative assessments and audits. Such a duty would expose the government to unlimited liability to a practically unlimited class, i.e taxpayers.


A.C.V.P. v. A.M.P., 2022 ONCA 283

[Trotter, Coroza and Favreau JJ.A.]

Counsel:

J. Montes, for the appellant

W. R. Clayton, for the respondent

Keywords: Family Law, Decision Making, Parenting, Best Interests of the Child, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 112, Children’s Law Reform Act, R.S.O. 1990, c. C.12, s. 30, Palmer v. The Queen, [1980] 1 S.C.R. 759, Goldman v. Kudelya, 2017 ONCA 300, Children’s Aid Society of Owen Sound v. R.D. (2003), 178 O.A.C. 69 (C.A.), S. v. M.S., 2010 ONCA 196, Van de Perre v. Edwards, 2001 SCC 60, V.S.J. v. L.J.G. (2004), 5 R.F.L. (6th) 319, (Ont. S.C.), Merkand v. Merkand, 2006 CanLII 3888 (Ont. C.A.), leave to appeal refused, [2006] S.C.C.A. No. 117, Young v. Young, 2013 ONSC 4423, Kucan v. Santos, 2017 ONSC 6725, Children’s Aid Society of London and Middlesex v. B.(C.C.), 2007 CanLII 66699 (Ont. S.C.), Glick v. Cale, 2013 ONSC 893, A.A. v. D.S., 2022 ONSC 1389, Kramer v. Kramer (2003), 37 R.F.L. (5th) 381 (Ont. S.C.), Parniak v. Carter (2002), 30 R.F.L. (5th) 381 (Ont. C.J.); Glance v. Glance (2000), 10 R.F.L. (5th) 276 (Ont. S.C.)

facts:

The parties married in May 2005, had two children, and separated in May 2014. Until November 2014, the appellant mother had primary care of the children while the respondent father had regular parenting time. In November 2014, the father brought a motion seeking, among other things, sole custody of the children with supervised access for the mother. The father alleged that the mother has serious mental health issues, including suicidal ideation and depression. In response, the mother alleged that the father had physically and verbally abused her during their marriage. The motion judge ordered custody on the terms sought by the father and requested that the Office of the Children’s Lawyer (“OCL”) conduct an investigation and prepare a report pursuant to s. 112 of the Courts of Justice Act, R.S.O. 1990, c. C.43 (“CJA”). That report was prepared in 2015, and the temporary custody order remained in place until the start of the trial in September 2018.

The trial judge ordered sole custody of the children to the father with supervised access for the mother on March 11, 2019. He denied the mother’s request for unsupervised access because he had not been provided evidence about her mental health. He held that it was appropriate to direct the mother to obtain a psychiatric assessment under s. 30 of the Children’s Law Reform Act, R.S.O. 1990, c. C.12 (“CLRA”), and/or s. 105 of the CJA. On December 3, 2020, at which point the mother had still not completed the assessment, the trial judge found that compliance with his psychiatric assessment order had been long overdue. Accordingly, he finalized his previous order of supervised access for the mother.

The mother appealed from the final orders of the trial judge. She requested that she have unsupervised access to the children every other weekend and one Wednesday evening per week, or that the children have primary residence with her.

issues:

(1) Did the trial judge err by applying a misguided approach to the best interests of the children by ignoring and misapprehending the evidence tendered at trial?

(2) Did the trial judge err by ordering the mother to obtain a psychiatric assessment at the end of the trial pursuant to s. 30 of the CLRA?

holding:

Appeal dismissed.

reasoning:

(1) No.

There was no basis to interfere with the trial judge’s assessment of the best interests of the children.

The determination of parenting orders involves issues of mixed fact and law, and intervention on appeal is only warranted where there is a material error, a serious misapprehension of the evidence, or an error of law. Appellate courts must approach an appeal with considerable respect for the trial judge’s task in difficult family law cases, especially those involving parenting issues. One must be mindful of the inherently discretionary nature of making parenting orders.

The trial judge presided over 30 days of trial, made detailed findings of fact on all of the issues, and remained focused on the children throughout his reasons. The trial judge recognized that the mother was the primary caregiver until November 2014, and engaged with the views of the children. The trial judge summarized the evidence provided in the OCL report, which was prepared by an experienced social worker. The trial judge acknowledged the mother’s allegations of the father’s physical and verbal abuse, but found that concerns no longer existed. The trial judge also found that there was no suggestion that the father demonstrated inappropriate or unfit parenting.

The trial judge noted the importance of the mother’s conduct since November 2014. She had not complied with court orders, frequently misinterpreting them in her favour, and had not supported the children’s relationship with their father. The mother had not acted in the children’s best interests. Alternatively, the father had generally supported the mother having a parenting role in the lives of the children. The trial judge determined that this had in the past, and would continue to have, a significant impact on the children.

The father was given sole decision-making responsibility based on all of this evidence, including the children’s views, preferences, and what was in their best interests.

(2) No.

The Court declined to interfere with the trial judge’s discretionary decision to require the mother to undergo a psychiatric assessment.

The trial judge had jurisdiction to order an assessment pursuant to s. 30 of the CLRA and/or s. 105 of the CJA. A plain reading of these provisions and a review of the case law supports the trial judge’s request for a psychiatric assessment in this case. An assessment can be ordered where there is sufficient evidence that such an assessment would be directly pertinent to determining the best interests of the child. The trial judge held that the best interests of the children required information about the mother’s mental health for the court to assess any effect on the children, and explained clearly why this was the case.

The trial judge determined that there were clinical issues identified at trial that had, and may continue to have, a direct impact on the children. Regardless, there are no hard and fast rules in determining whether to order an assessment under s. 30 of the CLRA. The inquiry is fact-driven and flexible. The trial judge was justifiably concerned about the direct effect on the children of the mother’s mental health. The author of the OCL report testified that she was more concerned about the mother’s mental health now than in 2015, at which time she had recommended sole custody to the father.

As for the timing of the order, the trial judge noted that neither party had requested a s. 30 assessment at trial. There is nothing in s. 30 of the CLRA that prohibits the trial judge from ordering an assessment at the end of the trial, especially in light of the trial judge’s willingness to revisit his preliminary conclusion about access upon obtaining the results of the assessment. Section 30 of the CLRA is silent as to when assessments may be ordered, giving the trial judge discretion to do so at the end of trial.


Lavallee v. Isak, 2022 ONCA 290

[Roberts J.A. (Motion Judge)]

Counsel:

C. R. Daoust, for the moving parties

C. Nahum, for the responding party

Keywords: Torts, Defamation, Civil Procedure, Appeals, Security for Costs, Rules of Civil Procedure, Rules 61.06(1)(a) and (c), Grant v. Torstar, 2009 SCC 61, Yaiguaje v. Chevron Corporation, 2017 ONCA 827, Schmidt v. Toronto Dominion Bank (1995), 24 O.R. (3d) 1 (C.A.), Pickard v. London Police Services Board, 2010 ONCA 643, York University v. Markicevic, 2017 ONCA 651, Henderson v. Wright, 2016 ONCA 89, Heidari v. Naghshbandi, 2020 ONCA 757

facts:

The moving parties, S.L. and J.L. (“The L’s”), sought an order that the responding party, S.I., post security for their costs: $30,0000 as security for the $20,0000 cost award granted to them in their successful defamation action and $10,000 for their estimated appeal costs. The L’s argued that they should not be subjected to the costs of an unmeritious appeal that they will not be able to compel S.I. to pay.

S.I. did not file any evidence in response to the motion. Counsel for S.I. submitted that S.I. is impecunious and did not dispute that S.I. had insufficient funds to pay the L’s costs. There was no objection to the amount requested as security for costs or that it covered both the trial and estimated appeal costs. S.I. did submit that her appeal was meritorious and brought in good faith and no security of costs should be ordered. The L’s argued in the alternative, if security for costs was not granted, the parties agreed that the L’s may have an extension of time to file a cross-appeal and file their factum.

The action was brought against S.I. for defamation seeking damages and a permanent injunction. S.I. defended the action, initially including and then abandoning a counterclaim. The L’s brought a motion for summary judgment and filed affidavits. S.I. was examined for discovery but did not examine the L’s. The motion judge concluded that it was an appropriate case for summary judgment because there were no material facts in dispute and notes S.I. did not challenge the appropriateness of summary judgment. The motion judge found that the three elements of defamation were met and S.I.’s online posts were defamatory. The motion judge rejected S.I.’s defences of justification and fair comment. The motion judge allowed the motion for summary judgment and granted judgment to the L’s in the amount of $50,000 to each party plus costs. S.I. appealed. The basis of the appeal being that the motion judge erred in finding that there was no provable, factual basis supporting her opinion.

issue:

Should security for costs be ordered?

holding:

Motion granted.

reasoning:

Yes.

The ordering of security for costs is discretionary and not routine. It involves the consideration of the criteria under rule 61.06(1) and requires the overarching assessment of whether it would be just to order security, having regard to the particular circumstances of the case and the interests of justice. S.I. did not put forward an arguable basis to interfere with the trial judge’s findings. There was good reason to believe that the appeal was vexatious. S.I. did not pursue her appeal or follow the rules with diligence which resulted in unexplained and unnecessary delay and costs. As S.I. conceded that she did not have sufficient assets to satisfy the L’ costs, it would prove practically impossible for them to compel payment of their costs. There was no evidence, however, that S.I. does not have any means to pay costs. Considering the lack of the appeal’s merit and S.I’ s delay in pursuing it, it would be unfair to expect the L’s to shoulder the burden of the costs of an unmeritorious appeal.


SHORT CIVIL DECISIONS

Marshall v. Meirik, 2022 ONCA 275

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

Counsel:

M. Bookman, for the appellants

C. Linthwaite, for the respondents

Keywords: Contracts, Real Property, Agreements of Purchase and Sale of Land, Damages, Mitigation, Civil Procedure, Costs

X.H. v. Cota, 2022 ONCA 274

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

Counsel:

N. Groot and E. Stoik, for the appellant R.C.

S. Kar and M. Saad, for the defendant Her Majesty the Queen

D. Zacks, C. Valiquette and J. Herbert, for the respondents

Keywords: Torts, Negligence, Civil Procedure, Summary Judgment, Striking Pleadings, Limitation Periods, Limitations Act, 2002, S.O. 2002 c. 24, Sch. B., s. 16, Jane Doe v. Weinstein, 2018 ONSC 1126

Goguen v. Baptiste, 2022 ONCA 284

[MacPherson, Paciocco and George JJ.A.]

Counsel:

S. Zucker and N. J. Tourgis, for the appellants

M. Jilesen and S. Talebi, for the respondent

Keywords: Civil Procedure, Mareva Injunctions, Jurisdiction, Chevron Corp. v. Yaiguaje, 2015 SCC 42

Rieder zu Wallburg v. Plista Gmbh, 2022 ONCA 281

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

Counsel:

D. J. Spiller, for the appellants

E. Kurz, for the respondents

Keywords: Contracts, Civil Procedure, Jurisdiction, Forum Non Conveniens, Costs, Club Resorts Ltd. v. Van Breda, 2012 SCC 17


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 over 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 over two decades of experience handling a wide variety of litigation matters. John assists clients with matters ranging from appeals, to injunctions, to corporate, partnership, breach of contract, construction, environmental contamination, product liability, debtor-creditor, insolvency and other business litigation. He also handles complex estates and matrimonial litigation involving disputes over property and businesses, as well as professional discipline and professional negligence matters for various types of professionals. In addition, John represents amateur sports organizations in contentious matters, and also advises them in matters of internal governance. John can be reached at 416-593-2953 or jpolyzogopoulos@blaney.com.