APPEALS ALLOWED

36452 Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co.

Insurance — Property insurance — All risks policy — Standard of Review

On appeal from a judgment of the Alberta Court of Appeal (2015 ABCA 121), setting aside a decision of Clackson J. (2013 ABQB 585).

During construction, a building’s windows were scratched by the cleaners hired to clean them. The cleaners used improper tools and methods in carrying out their work, and as a result, the windows had to be replaced. The building’s owner and the general contractor in charge of the construction project claimed the cost of replacing the windows against a builders’ risk insurance policy issued in their favour and covering all contractors involved in the construction. The insurers denied coverage on the basis of an exclusion contained in the policy for the “cost of making good faulty workmanship”.

The trial judge held the insurers liable, finding that the exclusion clause was ambiguous and that the rule of contra proferentem applied against the insurers. The Court of Appeal reversed that decision. Applying the correctness standard of review to the interpretation of the policy, the court held that the trial judge had improperly applied the rule of contra proferentem because the exclusion clause was not ambiguous. The court devised a new test of physical or systemic connectedness to determine whether physical damage was excluded as the “cost of making good faulty workmanship” or covered as “resulting damage”. Based on this test, the court concluded that the damage to the windows was physical loss excluded from coverage, because it was not accidental or fortuitous, but was directly caused by the intentional scraping and wiping motions involved in the cleaners’ work.

Held (9-0):The appeals should be allowed

Per McLachlin C.J. and Abella, Moldaver, Karakatsanis, Wagner, Gascon, Côté and Brown JJ.:

The appropriate standard of review in this case is correctness. The interpretation of a standard form contract should be recognized as an exception to the Court’s holding in Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633, that contractual interpretation is a question of mixed fact and law subject to deferential review on appeal. The first reason given in Sattva for concluding that contractual interpretation is a question of mixed fact and law — the importance of the factual matrix — carries less weight in cases involving standard form contracts. Indeed, while a proper understanding of the factual matrix of a case is crucial to the interpretation of many contracts, it is less relevant for standard form contracts because the parties do not negotiate the terms. The contract is put to the receiving party as a take-it-or-leave-it proposition. Factors such as the purpose of the contract, the nature of the relationship it creates, and the market or industry in which it operates should be considered when interpreting a standard form contract, but they are generally not inherently fact specific and will usually be the same for everyone who may be a party to a standard form contract.

Moreover, the interpretation of a standard form contract itself has precedential value and can therefore fit under the definition of a pure question of law. In general, the interpretation of a contract has no impact beyond the parties to a dispute. While precedents interpreting similar contractual language may be of some persuasive value, it is often the intentions of the parties, as reflected in the particular contractual wording at issue and informed by the surrounding circumstances of the contract, that predominates. In the case of standard form contracts, however, judicial precedent is more likely to be controlling. Establishing the proper interpretation of a standard form contract amounts to establishing the correct legal test, as the interpretation may be applied in future cases involving identical or similarly‑worded provisions. The mandate of appellate courts — ensuring consistency in the law — is also advanced by permitting them to review the interpretation of standard form contracts for correctness. The result of applying the interpretation in future cases will of course depend on the facts of those cases.

In this case, while the base coverage under the relevant clause of the policy is for physical loss or damages, the exclusion clause need not necessarily encompass physical damage because perfect mutual exclusivity between exclusions and the initial grant of coverage is neither provided for under the policy nor required when interpreting the exclusion clause. Accordingly, the physical or systemic connectedness test established by the Court of Appeal was unnecessary.

While the language of the exclusion clause is ambiguous, the general principles of contractual interpretation lead to the conclusion that the exclusion clause serves to exclude from coverage only the cost of redoing the faulty work, that is, the cost of recleaning the windows. The damage to the windows and therefore the cost of their replacement is covered. Given that the general rules of contract construction resolve the ambiguity, it is not necessary to turn to the contra proferentem rule.

This interpretation is consistent with the reasonable expectations of the parties and reflects and promotes the purpose of builders’ risk policies. The broad coverage provided in exchange for relatively high premiums provides certainty, stability and peace of mind, and ensures construction projects do not grind to a halt because of disputes and potential litigation about liability for replacement or repair amongst various contractors involved. An interpretation of the exclusion clause that precludes from coverage any and all damage resulting from a contractor’s faulty workmanship merely because the damage results to that part of the project on which the contractor was working would undermine the purpose behind builders’ risk policies and would deprive insureds of the coverage for which they contracted. Moreover, interpreting the exclusion clause to preclude from coverage only the cost of redoing the faulty work aligns with commercial reality and leads to realistic and sensible results, given both the purpose underlying builders’ risk policies and their spreading of risk on construction projects. Such an interpretation is also consistent with the jurisprudence.

Per Cromwell J.: There is agreement as to the disposition of the appeals. The trial judge made no legal error because he properly described and applied the Court’s decision in Progressive Homes Ltd. v. Lombard General Insurance Co. of Canada, 2010 SCC 33, [2010] 2 S.C.R. 245.

However, the applicable standard of review is that of palpable and overriding error. As the Court held in Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235, the general principles of appellate review in civil cases turn on characterizing the nature of the question being reviewed as one of fact, law or mixed fact and law. Questions of law are reviewed for correctness and questions of fact are reviewed for palpable and overriding error. Applying a legal standard to the facts is a question of mixed fact and law and is generally reviewable on appeal for palpable and overriding error. In rare cases, where the basis for a finding under review can be traced to a pure legal error, such as a wrong characterization of the legal test or the failure to consider a required element of the applicable standard, the reviewing court can extricate a purely legal question from the trial court’s analysis and apply the correctness standard to it.

The Court’s recent decision in Sattva brought appellate review in contract cases within this general framework. Applying the text of a contract to a particular fact situation involves applying the legal standard set by the contract to the facts of the situation at hand. Accordingly, a trial judge’s interpretation of the contract generally gives rise to a mixed question of law and fact and should be reviewable on appeal for palpable and overriding error. Contractual interpretation is generally not a pure question of law because it involves understanding the words used in light of a number of contextual factors beyond negotiation, including the purpose of the agreement, the nature of the relationship between the parties, and the market in which the parties are operating.

There is no reason for the interpretation of certain types of contracts such as standard form contracts to be excluded from the general principles that apply to appellate review in civil cases. Whether or not a contract is a standard form does not indicate anything about the degree to which it is concerned with a general legal proposition so as to attract correctness review. To ask the question in terms of precedential value rather than the generality of the legal principle in issue simply sends the analysis back to the question of the degree of generality. The more general the principle, the more the precedential value. Moreover, the absence of a factual matrix is not of much assistance, because like all contracts, standard form contracts have many surrounding circumstances — they have a purpose, they create a relationship of a particular nature between the parties, and they frequently operate within a particular market or industry — which must be taken into account in interpreting the text of the contract.

The question the present case raises involves applying a legal standard to a set of facts and does not give rise to any extricable question of law. The legal principle is that “making good faulty workmanship” means “the cost of redoing the faulty work”. This principle does not operate at a very high level of generality. Applying that principle turns on the scope of the faulty work and the nature of redoing it, and its application in other cases will ultimately be decided on a case‑by‑case basis in light of the particular circumstances of the particular case.

Reasons for Judgment by Wagner J. (McLachlin C.J. and Abella, Moldaver, Karakatsanis, Gascon, Côté and Brown JJ. concurring)

Concurring Reasons by Cromwell J.

Neutral Citation: 2016 SCC 37

Docket Number: 36452

http://scc-csc.lexum.com/scc-csc/scc-csc/en/item/16121/index.do

APPLICATIONS FOR LEAVE TO APPEAL DISMISSED

36977 L.V.R. v. Her Majesty the Queen

(B.C.)

Criminal law – Appeals – Powers of Court of Appeal

The applicant was convicted of several sexual offences; uttering a threat to cause death or bodily harm; and making child pornography. The applicant was sentenced to seven years and 97 days’ imprisonment, a lifetime order that he comply with the Sex Offender Information Registration Act and other ancillary orders. The Court of Appeal granted leave to appeal. The sentence on count 11 (making child pornography) was varied to 11 months, and the remainder of the appeal was dismissed.

36980 Daniel Walter Hill v. Paul James Hill, Richard P. Rendek, Rand Flynn

- and between -

Daniel Walter Hill v. Famhill Investments Limited, Harvard Developments Inc.
(Alta.)

Civil procedure – Fresh evidence – Res judicata

The applicant commenced an action alleging a one-quarter interest in the shares held in a trust settled by his father. The applicant alleged that he and his siblings were appointed as equal beneficiaries of the trust. The trial judge dismissed the applicant’s claim. The key findings of the trial judge rested on the trustees’ lack of intention to appoint the shares to the trust beneficiaries. The Court of Appeal dismissed the applicant’s appeal. The Supreme Court of Canada dismissed his application for leave to appeal.

The applicant subsequently secured certain archived material and started a new action, seeking to set aside the judgment in the first action on the basis of the newly discovered evidence. The respondents moved to strike the statement of claim on the basis that it was frivolous and vexatious, an abuse of process and res judicata. The Court of Queen’s Bench of Alberta dismissed the motion to strike but the Court of Appeal allowed the appeal.

36952 C.G.M. v. Her Majesty the Queen

(Alta.)

Criminal Law

CGM, a drug dealer, was convicted of manslaughter. Four young men, including CGM, planned to rob a drug dealer and agreed to harm him if he resisted. They lured him to a parking lot. During the robbery, the victim attempted to flee. CGM restrained the victim and another assailant shot the victim in the head, killing him instantly. The assailants completed the robbery and fled in CGM’s car. CGM was 17-years old at the time of the shooting. CGM was convicted of manslaughter. The Court of Appeal of Alberta dismissed the appeal.

36987 C.G.M v. Her Majesty the Queen

(Alta.)

Criminal Law

The Crown’s theory was that CGM was a member of a group of young men who were shooting for pleasure when he attacked and killed another member of the group. CGM was 17-years old at the time. AA, a Crown witness, testified that CGM attacked the victim, he helped restrain the victim during CGM’s attack and CGM helped conceal the body afterwards. The Crown relied in part on cell tower evidence, forensic evidence, surveillance evidence and telephone calls intercepted after the murder. Witnesses confirmed how items of evidence, including the guns, were handled after the murder. The Crown led evidence and argued that, after the murder, Mahoney admitted his involvement to his girlfriend and robbed AA to enforce a code of silence. CGM was convicted by a jury for first degree murder. The Court of Appeal dismissed CGM’s appeal from the conviction.

37000 Lo-Ming Lum v. Inquiries, Complaints and Reports Committee of the College of Physiotherapists of Ontario

(Ont.)

Charter of Rights and Freedoms – Civil Law

The Inquiries, Complaints and Reports Committee of the College of Physiotherapists of Ontario began an investigation into allegations that the applicant was publicly criticising physiotherapists, occupational therapists, employees, the CEO and Board members of the applicant’s former employer, a hospital. On May 14, 2015, the Committee issued a letter advising the applicant that it had determined that there were concerns with regards to conduct and behaviour that reflected negatively on the applicant as a physiotherapist and the profession as a whole. The Committee advised that applicant that it required her to appear before it in order to receive a caution. The applicant applied for judicial review. The application was dismissed. The Court of Appeal denied leave to appeal.

37001 Jeklina (Gina) Konjarski v. Inquiries, Complaints and Reports Committee of the College of Physiotherapists of Ontario

(Ont.)

Charter of Rights and Freedoms

The Inquiries, Complaints and Reports Committee of the College of Physiotherapists of Ontario began an investigation into allegations that the applicant was publicly criticizing physiotherapists, occupational therapists, employees, the CEO and Board members of the applicant’s former employer, a hospital. On May 14, 2015, the Committee issued a letter advising the applicant that it had determined that there were concerns with regards to conduct and behaviour that reflected negatively on the applicant as a physiotherapist and the profession as a whole. The Committee advised that applicant that it required her to appear before it in order to receive a caution. The applicant applied for judicial review. The application was dismissed. The Court of Appeal denied leave to appeal.

36995 M.D. v. Her Majesty the Queen

(B.C.)

Family law

The applicant’s child, G., was removed from his custody at birth in July 2013. In 2013 and 2014, various provincial court orders granted custody of G. to the Director of Child, Family and Community Services. By way of multiple applications, the applicant appealed the orders to the Supreme Court of British Columbia. The Director successfully applied to have the appeal struck. The applicant’s application for leave to appeal to the British Columbia Court of Appeal was dismissed, as was the applicant’s application to vary the order denying leave to appeal.

36931 Frederic Ntibarimungu v. Mark Douglas Stuart Smith, Shannon Smith, and Canadian Road Leasing Company/Compagnie de location Canadian road Shannon Smith, and Canadian Road Leasing Company/Compagnie de location Canadian road

(B.C.)

Civil procedure

The applicant brought a civil action against the respondents relating to an alleged motor vehicle accident. His application to adjourn the trial was dismissed before the trial date. On the first day of trial, the applicant renewed his adjournment application before the trial judge. The trial judge refused the adjournment. The applicant indicated that he was not prepared to proceed. The trial judge dismissed the action.

The applicant filed a notice of appeal and although some steps were taken, the matter was placed on the inactive list one year later. The applicant’s applications to have his appeal restored and for an extension of time within which to file his materials were dismissed.

The applicant sought to a review of the order dismissing his application but missed the filing deadline by six days. His application for an extension of time in which to file his application was dismissed. The applicant then applied to a panel of three judges of the British Columbia Court of Appeal to review the decision denying the extension of time. His application was dismissed.

36855 Police Complaint Commissioner of British Columbia v. Abbotsford Police Department, Attorney General of British Columbia

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Police Complaint Commissioner of British Columbia v. Abbotsford Police Department, Attorney General of British Columbia

(B.C.)

Police – Informer privilege – Appeals

Constable A.B. is a member of the Respondent, Abbotsford Police Department (“APD”). He was arrested and charged in May 2013 with several criminal offences including breach of trust and wilful obstruction of justice. In July, 2013 he was also charged by way of direct indictment with ten counts including counselling the commission of an offence. When the Chief Constable of the APD became aware of the allegations against Cst. A.B., he requested that the Vancouver Police Department (“VPD”) conduct an external criminal investigation as well as an audit of the APD’s informer payment process. In the course of the investigation, the VPD obtained two authorizations to intercept private communications and APD office copies of search warrants and Informations to Obtain (“ITO’s”).

In May 2013, the APD requested the Applicant, Police Complaints Commissioner (“PCC”) to undertake an investigation into Cst. A.B.’s conduct under the Police Act. In August 2013, the PCC directed the New Westminster Police Department (“NWPD”) to look into the allegations concerning Cst. A.B. In October 2013, the investigating officer (of the NWPD) applied in the R. v. A.B. proceeding to the Supreme Court of British Columbia for access to materials in the possession of the VPD. The court granted the order (“2013 order”), specifying that the requested materials were to be delivered personally by a VPD officer to the external discipline authority (“DA”) and were not to be disclosed or distributed by him to anyone other than police officers within the Professional Standards Section (“PSS”) of the NWPD who were involved in the investigation of Cst. A.B. under the Police Act or to staff or legal counsel assisting the DA or PSS investigators. A further order was granted ordering that the PSS investigators receive draft ITOs from the VPD as well as copies and drafts of sealed ITOs from the APD that had been obtained by the VPD in the summer of 2013. In June 2014, the investigating officer applied for a second order which was granted on consent. The order directed the investigating officer and the PSS investigators to examine progress reports prepared under the Police Act to determine which documents could disclose or reveal, or tend to disclose or reveal the identity of, or compromise the safety or security of a police informant or confidential source. Documents satisfying these criteria were ordered not to be disclosed to the PCC.

Upon application by the PCC for access to materials in the possession of the NWPD, the chambers judge declined to give directions with respect to the procedure to be followed on application to unseal original ITOs which remain subject to sealing orders until it was determined either that no informant’s identity is at issue or that any confidential informants whose identity could be compromised by access to the ITOs, and the Crown, had waived the privilege. The chambers judge thus ordered that the materials comprising the criminal investigation that had led to the charges against Cst. A.B. be returned to the VPD to be reviewed and if necessary, redacted to prevent the disclosure of the identity of any confidential informant. He also ordered that all other material obtained by the PSS investigator that might reveal the identity of an informant be sealed and held in a sealed state until further order of the court. The Court of Appeal quashed the appeal as the order made by the chambers judge was criminal and no appeal to the Court of Appeal was available. In the alternative, or in the event that the court was wrong concerning jurisdiction, the Court of Appeal went on to consider the merits of the appeal and would have dismissed the appeal.

36836 Her Majesty the Queen v. Jamal Green

(Que.)

Criminal law – Defences – Self-Defence

On October 9, 2011 the victim, a superintendent of an apartment complex, was on his day off from work when he received a noise complaint from a tenant in the building. The victim went to the respondent’s apartment and an altercation occurred. The version of events varies from the victim and respondent. In the end, the victim had to undergo several surgeries and lost eyesight in his left eye. The respondent claimed that he acted in self-defence. The respondent was found guilty of aggravated assault and sentenced to a 20 month term of imprisonment and probation for a period of two years. The Court of Appeal set aside the verdict and ordered a new trial.

36998 Myra York in her personal capacity, in her capacity as the named Estate Trustee of the Primary Will of Chaim Neuberger, in her capacity as the named Estate Trustee of the Secondary Will of Chaim Neuberger and, in her capacity as the Attorney for Property or Attorney for Property de son tort for Chaim Neuberger, Sonny York, Spencer York and Laura York v. Edie Neuberger in her capacity as the named Estate Trustee of the Primary Will of Chaim Neuberger and in capacity as the named Estate Trustee of the Secondary Will of Chaim Neuberger, Adam Jesin-Neuberger

(Ont.)

Civil procedure – Estoppel – Estates

The parties are the beneficiaries of an estate. Edie Neuberger brought a motion challenging the validity of wills executed by the deceased in 2010 and Adam Jesin-Neuberger filed a notice of appearance in those proceedings. The respondents brought a motion to strike the challenges to the wills on the basis of the equitable doctrines of estoppel by conduct and estoppel by representation. The Ontario Superior Court of Justice struck the motion challenging wills. The Court of Appeal for Ontario allowed the appeal.

36996 Johnson & Johnson inc., Depuy Orthopaedics inc. v. Alan Dick, Régie de l’assurance-maladie du Québec

(Que.)

Civil Procedure – Class actions – Right to professional secrecy

On May 13, 2014, the Superior Court of Quebec authorized the institution of a class action seeking compensatory and punitive damages from the Applicants who manufactured and distributed hip implants which were recalled due to abnormally high incidences of failure. The class members are the recipients of the recalled implants, many of whom required or require premature revision surgery. The Applicants were unable to provide the names and coordinates of the Quebec recipients of the recalled implants. Class counsel accordingly presented a motion to authorize the Régie de l’assurance-maladie du Québec (“RAMQ”) to provide the names and coordinates of the class members in order to enable class counsel to identify and contact them for purposes of the class action. The RAMQ consented to the motion. The Applicants contested on the grounds that the right to professional secrecy of the class members was being violated. The Superior Court of Quebec allowed the motion to authorize the RAMQ to provide the names and coordinates of the class members. The Court of Appeal of Quebec dismissed the appeal.

36892 Rosalina Templanza v. Edward L. Wolfman, Edward L. Wolfman Professional Corporation operating as Wolfman & Company

(Alta.)

Limitation of Actions ― Summary judgment

The issue in this case concerns applicable limitation periods. The applicant, Ms. Templanza commenced an action against her lawyer, the respondents, on May 22, 2009 alleging they had breached their duties as her lawyer in failing to protect her rights concerning a botched real estate deal.

In the initial application, the Master concluded that the applicable limitation period within which an action could be brought against the respondents was two years under s. 3 of the Limitations Act, R.S.A. 2000, c. L-12. He decided that Ms. Templanza knew, or ought to have known as early as October 2006 or at the latest May 9, 2007 that she suffered an injury attributable to Wolf’s conduct. As such, her May 22, 2009 action was out of time.

The chambers judge agreed with the Master’s decision. The Court of Appeal also agreed and the appeal was dismissed.

36944 Pierre-Lougens Henri v. Attorney General of Canada

(FC)

Administrative law – Security clearances

Mr. Henri, applicant, is an aeronautics technician and mechanic whose security clearance was revoked in 2013 by the Minister of Transport, Infrastructure and Communities (“Minister”) on the basis that there was reason to believe that he might be prone or induced to commit, or to assist or abet any person to commit, an unlawful act against civil aviation. An RCMP investigation had revealed Mr. Henri’s ties to two individuals involved in criminal activities. Mr. Henri’s application for judicial review of the Minister’s decision was dismissed, as was his appeal. The courts found that the rules of procedural fairness had not been breached and that the Minister’s decision was reasonable in the circumstances.

36956 Katherine Lin v. Jing Zhang and Song Lin Zhang

(Ont.)

Appeals

The applicant, Katherine Lin, brought an application to the Landlord and Tenant Board, claiming damages of $200,000 against the respondent Jing Zhang, her landlord, for substantial interference with her quiet enjoyment and for harassment. The Board dismissed the application. The applicant’s appeal to the Divisional Court was dismissed, and the Court of Appeal denied leave to appeal.

36954 David Prabakar Jayaraj v. His Excellency the right Honorable Governor General David Johnston, Honourable Chris Alexander, Attorney General of Canada, Minister of Justice and Minister of Citizenship and Immigration

(FC)

Charter of Rights and Freedoms – Civil procedure

Mr. Jayaraj brought an application against the Governor General (named by his office and personally), the Attorney General of Canada, the Minister of Justice, and the Minister of Citizenship and Immigration (named by his office and personally), seeking various relief.

The trial judge found that Mr. Jayaraj did not have either private interest or public interest standing: Canada (Attorney General) v. Downtown Eastside Sex Workers United Against Violence Society, 2012 SCC 45. Although that was sufficient to dismiss the application, he further found that judicial review is not available in these circumstances: Galati v. The Governor General, 2015 FC 91. Finally, he dismissed the Charter arguments for lack of evidence. The Court of Appeal dismissed Mr. Jayaraj’s appeal for delay.