The Court of Appeal released a number of civil decisions this week with topics including the conversion of bills of exchange issued by a fraudulent employee and the fictitious and non-existent payee defences under the Bills of Exchange Act that protect banks, conflicts of interest in the solicitor-client relationship, family law, adverse possession and easements and commercial leases.
Have a great weekend.
Henderson v. Wright, 2016 ONCA 89 [Strathy C.J.O. (In Chambers)]
Counsel: Robert Hammond, for the respondent/moving party Clinton Culic, for the appellant/responding party
Keywords: Contracts, Real Property, Civil Procedure, Appeals, Security for Costs, Frivolous and Vexatious, Rules of Civil Procedure, Rule 61.06
Facts: The appellant claims an interest in the respondent’s home, in which he and his wife lived, paying rent for over 20 years. The respondent’s former son-in-law claimed there was an agreement with the respondent whereby she would make a down payment on a home, which was purchased in the respondent’s name, and he and his wife would pay rent to cover the mortgage, taxes and insurance. The respondent claimed that when the mortgage was paid off, the house was to be transferred to him and his wife.
The respondent’s version was that she intended to make a real estate investment and provide her daughter and son-in-law with a nice place to live at a favourable rent. The respondent denied any intention to gift the amount of the down payment paid, $50,000, or to transfer ownership of the property once the mortgage was paid. The respondent also made several lump sum mortgage payments and the mortgage was paid off seven years after the home was purchased.
Following the appellant’s separation from the respondent’s daughter, he remained in the house but stopped paying rent. The respondent applied to the Landlord and Tenant board to evict him. The appellant claimed he had an ownership interest in the property based on the alleged agreement. Alternatively, the appellant relied on the equitable principle of promissory estoppel. The trial judge found in favour of the respondent’s version of events and rejected the claim based on promissory estoppel. The appellant appealed and the respondent sought an order for security for costs of the appeal.
- Pursuant to Rule 61.06(1)(a) of the Rules of Civil Procedure, is there reason to believe the appeal is frivolous and vexatious?
- Pursuant to Rule 61.06(1)(c) of the Rules of Civil Procedure, is there any other good reason to order security for costs?
Holding: The appellant was required to post security for costs in the amount of $15,000 within 60 days.
1. Yes. The court found there was good reason to believe the appeal was frivolous and vexatious, and to believe the appellant had insufficient assets in Ontario to cover the costs of the appeal. The appeal did not raise any arguable error in law, and challenged findings of fact and credibility which this court has held are appeals without merit. The court found the trial judge gave detailed and sound reasons for his findings, and in such cases, there would be almost no possibility of successfully overturning the result. In addition, the appellant demonstrated to the court through his less than diligent pursuit of his litigation that the appeal was frivolous and vexatious.
Further, the appellant’s only asset of any significance was a 25% interest in a cottage property owned with other family members. The court found this asset to be illiquid and unmarketable, and insufficient for the respondent to rely on for the purposes of protecting costs of the appeal.
2. The court stated that appellate courts in Ontario have ordered security for costs when an appeal has a low prospect of success coupled with an appellant who has the ability to pay costs but from whom it would be nearly impossible to collect costs. It referred to this as a “good reason” balance to ensure the appellant is not denied access to the courts, while protecting the respondent’s right to be protected from the risk the appellant will not satisfy the costs of the appeal. Given the reasons regarding the first issue, the court found “good reason” applied in this case. Further, the appellant worked as a bartender with little or no proof of income, which would be nearly impossible for the respondent to garnish to satisfy costs.
410784 Ontario Limited v. Little Zinger Inc. (Corktown Esso), 2016 ONCA 90 [Gillese, MacFarland and van Rensburg JJ.A.]
Counsel: P James Zibarras and Adam N. Weissman, for the appellant Wendy Greenspoon-Soer, for the respondents
Keywords: Real Property, Contracts, Fiduciary Duty, Good Faith, Torts, Conspiracy, Unlawful Interference with Economic Interests, Limitation Periods, Limitations Act, s. 5, Discoverability
Facts: A gas station, 410784 Ontario Limited (“410784”), leased property from a landlord until it was given notice to vacate. Two employees of the gas station incorporated a company and entered into a lease with the landlord in February 2006 to operate a gas station. This new corporation brought an action against 410784 and its principals for damages for remediation of the site in February 2009. 410784 brought a counterclaim in March 2009 seeking damages for breach of contract, breach of fiduciary duty, breach of good faith, conspiracy and unlawful interference with economic interests. The new corporation discontinued its claim, but the counterclaim proceeded to trial. The counterclaims were dismissed at trial on the basis that they were statute-barred. The trial judge concluded that 410784 knew that the employees had entered into a lease with the landlord prior to March 2007, which was more than two years before the counterclaim was issued.
- Did the trial judge make palpable and overriding errors in her factual determination?
- Did the trial judge err in law in concluding that the claims for inducing breach of contract were statute-barred?
Holding: Appeal dismissed
- No, the trial judge’s finding was amply supported by the record. The trial judge’s conclusion that 410784 knew before March 2007 that the employees had entered into a lease with the landlord was supported by the employees’ testimony that they had a conversation with a principal of 410784 in February 2006 regarding this issue. The trial judge’s finding is entitled to deference by the Court of Appeal.
- No. Although the trial judge did not specifically deal with whether the claim against the landlord for inducing breach of contract was statute-barred, the Court of Appeal held that it was unnecessary to deal with this issue because it failed on the merits. The trial judge found there was a lack of the necessary intention element, which was supported by the evidence.
Mapleview-Veterans Drive Investments Inc. v. Papa Kerollus VI Inc. (Mr. Sub), 2016 ONCA 93 [Blair, Hourigan and Brown JJ.A.]
Counsel: Milton A. Davis and Ian P. Katchin, for the appellant Sharon M. Addison for the respondent
Keywords: Real Property, Commercial Leases, Option to Renew, Whether Excercisable, Default, Whether Void for Uncertainty
Facts: Papa Kerollus entered into a commercial lease agreement in 2000 for a term of 15 years. The lease gave Kerollus an option to renew for one further period of five years on the same terms and conditions “save as to the rental rate which shall be the then current rate”. Kerollus claims to have exercised the renewal option in November 2014 (within the time required). Mapleview disputed its right to do so claiming that the renewal option was void for uncertainty with no guidelines for the calculation of the renewal term rent and no arbitration provision to settle it if agreement was not reached. Further, Papa Kerollus was in default of a precondition to exercise the option because it had not paid rent and all other sums payable under the lease when due and it was also in default of a precondition to the exercise of the option because it had not “performed all other covenants under the Lease” at the relevant time.
Mapleview applied to the court for declaration that the renewal option was void for uncertainty, or in the alternative, for an order and declaration that Kerollus was in breach of terms of the lease and that the purported exercise of the renewal option was invalid and unenforceable.
After the hearing, the judge held that the renewal option was not void for uncertainty because the term “current rate” was capable of judicial determination provided the parties called expert evidence on the point. There was a live issue on the amount owing by Kerollus, once it had paid arrears, if any, “the current rate” for the renewal period was to be determined judicially on the basis of expert evidence.
- Did the application judge err in holding that the renewal option clause was not void for uncertainty?
- Did the application judge err in holding that Papa Kerollus was entitled to exercise the renewal option once the amount of rental arrears owing by it had been determined by way of a trial of that issue?
Holding: Appeal Allowed
- No. The court was satisfied that the parties intended to make a binding agreement as to the renewal rate; they simply declined to specify that rate in a dollar amount because neither wished to assume the risk of error (too high or too low, depending on their interest) 15 years later. This makes commercial sense. Expressing the renewal rate as the “then current rate” is the functional equivalent of saying the “then market value” or the “then prevailing market rate” – expressions that have been found to be sufficient to overcome a void-for uncertainty argument. The court agreed with the application judge’s conclusion.
- The court found that the application judge erred in concluding that Kerollus was not in rent-related default at the time of its purported exercise of the option to renew and was entitled to judicial determination of what amounts owed under the lease. The court held that Papa Kerollous did not satisfy its onus to show that it complied with its obligation to have paid the rent and all other sums payable under the lease when due as a precondition to exercise the renewal option. The application judge erred in law in overlooking the onus Papa Kerollus was required to meet, and made palpable and overriding errors of mixed fact and law in failing to hold, on this record, that Papa Kerollus had not complied with its obligation to pay all additional rent when due and that it therefore was not in a position to exercise the option to renew the lease.
Roth Estate v. Juschka, 2016 ONCA 92 [Feldman, Hourigan and Benotto JJ.A.]
Counsel: Thomas J. Corbett, for the appellants James D. Virtue and Dagmara Wozniak, for the respondent
Keywords: Torts, Professional Negligence, Lawyers, Breach of Fiduciary Duty, Conflicts of Interest, Contracts, Share Purchase Agreement, Debtor-Creditor, Promissory Notes
Facts: The respondent is a lawyer who acted for both sides in a family share purchase transaction that included the provision of a promissory note. In the action against them on the note, the appellants brought a third party claim against the lawyer for negligence and breach of fiduciary duty. At trial, the action on the note was successful, while the third party claim was dismissed. Following that judgment, the parties to the main action settled for a lesser sum. This appeal was solely against the dismissal of the third party claim. The appellants sought indemnification for the amount they paid to settle the judgment on the note.
The appellants also submitted that the trial judge made palpable and overriding errors of fact in three areas, and that those errors undermined his conclusion on their third party claim.
- Did the respondent breach his fiduciary duty to the appellants by acting for all parties where there was a conflict of interest and by failing to send them for independent legal advice?
- Did the respondent fall below the standard of care by implementing the instructions of Harold Roth and failing to assess and advise the appellants of the significance of the liabilities they were undertaking and whether the arrangement was in their best interests?
Holding: Yes to both – Appeal Allowed
1. Yes. A solicitor acting for a client owes the client a fiduciary duty to act in the best interests of that client. In this case, the respondent acted for all parties on what turned out to be a share sale transaction without ever considering whether there was a conflict of interest or a potential conflict. Having perceived no potential conflict, he did not undertake to raise the problem of acting for both sides, to explain the potential conflict, to obtain consent to act for both sides or to recommend independent legal advice. The trial judge’s findings were based on a misapprehension of the evidence with respect to the effect of the transaction and an error of law. Moreover, that the parties were amicable at the time of the transaction was wholly irrelevant to whether their interests in the transaction had the potential to conflict.
Moreover, that the respondent suggested that a term in the transaction that was critical to the interests of one client remain undocumented and perhaps unenforceable by them to protect the interests of the other client revealed actual conflict of interest.
While the trial judge equated this matter to Upper Valley Dodge Chrysler v. Cronier Estate, that case was distinguishable on the facts and thus had no application. Ultimately, had the Juschkas obtained independent legal advice, the lawyer would have exposed the pitfalls in the deal and suggested alternative responses that the Juschkas could have presented before they agreed to be bound. It was thus a palpable and overriding error for the trial judge to find that the Juschkas would have signed the documentation “whether they had gone to another lawyer or not”.
2. Yes. The respondent was required to bring reasonable care, skill and knowledge to the performance of the services he undertook to perform, and he fell below the standard of care in the performance of his services for the Juschkas. Specifically, he failed to understand and explain the meaning and effect of the promissory note or how the Juschkas could potentially pay an amount for the Roths’ 51% of the shares that was far in excess of their value. He also failed to warn the Juschkas of the risks of the transaction.
Teva Canada Limited v. Bank of Montreal, 2016 ONCA 94 [Weiler, Laskin and Cronk JJ.A.]
Counsel: Frank J. McLaughlin, Jeffrey E. Feiner, for the appellant TD Canada Trust Martin Sclisizzi and Heather Pessione, for the appellant Scotiabank Colby Linthwaite and Sean Cumming, for the respondent Teva Canada Limited
Keywords: Torts, Fraud, Conversion, Bills of Exchange, Boma v. CIBC, , Bills of Exchange Act, s. 20(5), Fictitious and Non-Existing Payee Defence, Falconbridge’s Four Propositions
Facts: The appellants TD Canada Trust and Bank of Nova Scotia and the respondent Teva Canada Limited, a manufacturer of generic pharmaceuticals, were the innocent victims of fraud in the amount of over $5 million, perpetrated by Neil McConachie, a former employee in Teva’s finance department. Between 2003 and 2006, McConachie requisitioned numerous cheques payable to six entities he designated. McConachie and several accomplices opened accounts in the names of the six entities and deposited 63 cheques, which the banks negotiated, into these accounts. When the fraud was discovered in 2006, McConachie was fired. Teva then sued the banks for damages for conversion. As neither McConachie nor his accomplices were lawfully entitled to the funds, the banks were prima facie liable to Teva for converting them. The motion judge determined that the banks should bear the loss for the fraud, rejecting their defences under the Bills of Exchange Act (“BEA”). The banks appealed.
- Did the motion judge err by failing to hold that the banks had a valid defence under ss. 20(5) of the BEA for two of the payees (PCE Pharmacare and Pharma Team System) because they were non-existing payees?
- Did the motion judge err by failing to hold that the banks had a valid defence under ss. 20(5) of the BEA because all six payees were fictitious?
Holding: Appeal allowed. Under ss. 20(5) of the BEA, the banks had a valid defence to Teva’s conversion action.
1. Yes. Conversion is the wilful interference with the goods of another – that is taking, using or destroying these goods in a manner inconsistent with the owner’s right of possession. A bank converts an instrument, including a cheque, by dealing with it under the direction of one not authorized, by collecting it and making the proceeds available to someone other than the person rightfully entitled to possession. Subsection 20(5) of the BEA gives a collecting bank a statutory defence to an action for conversion by stating that where the payee is a fictitious or non-existing person, the bill may be treated as payable to bearer. The purpose of s. 20(5) is to protect the bank from fraud on the drawer, committed by a third party, including an insider in the drawer’s organization. The section allocates the loss to the drawer, who typically is better positioned to discover the fraud or insure against it.
For determining whether a payee is non-existing or fictitious, four propositions from Banking and Bills of Exchange by Falconbridge have been identified: (a) If the payee is not the name of any real person known to the drawer, but is merely that of a creature of the imagination, the payee is non-existing, and is probably also fictitious. (b) If the drawer for some purpose of his own inserts as payee the name of a real person who was known to him but whom he knows to be dead, the payee is non-existing, but is not fictitious. (c) If the payee is the name of a real person known to the drawer, but the drawer names him as payee by way of pretence, not intending that he should receive payment, the payee is fictitious, but is not non-existing. (d) If the payee is the name of a real person, intended by the drawer to receive payment, the payee is neither fictitious nor non-existing, notwithstanding that the drawer has been induced to draw the bill by the fraud of some other person who has falsely represented to the drawer that there is a transaction in respect of which the payee is entitled to the sum mentioned in the bill. The non-existing payee defence under Falconbridge’s first proposition was modified by Iacobucci J. in Boma v. CIBC. He appeared to treat non-existing and fictitious payees interchangeably. Instead of adhering to Falconbridge’s explanation of “non-existing” as a question of objective fact, Iacobucci J. imported the notion of “plausibility” into the question whether a payee is non-existing. The effect of his modification is that even if a payee is, in fact, a creature of the fraudster’s imagination, the payee may still not be non-existing if the drawer had a plausible and honest, though mistaken, belief that the payee was a real creditor of the drawer’s business.
The motion judge erred in failing to hold that both PCE Pharmacare and Pharma Team System were non-existing payees under Falconbridge’s first proposition, even as modified in Boma. PCE Pharmacare and Pharma Team System were invented by McConachie and were creatures of his imagination. Thus, the banks were entitled to treat the cheques to those two payees as payable to bearer. Correspondingly, Teva’s conversion action on those cheques must fail.
2. Yes. “Fictitiousness” matters under ss. 20(5) of the BEA and under Falconbridge’s fourth proposition only where the payees are real persons. In this case four of the payees – Pharmachoice, London Drugs, Pharma-Ed Advantage Inc. and Medical Pharmacies Group – are real persons who are or were Teva’s customers or service providers. Under Falconbridge’s propositions, whether payees are fictitious depends upon the intention of the creator of the instrument, that is, the drawer of a cheque. In Boma, Iacobucci J. said that the relevant intent for determining whether a payee is fictitious is the intent of the drawer itself, not the intent of the actual creator of the instrument. Thus, it is Teva’s intent or the intent of its directing mind, not McConachie’s intent, that governs. The relevant time for determining Teva’s intent is the time when the cheques were drawn, not afterwards. Teva failed to show it intended the four payees who are or were its customers or the two non-existing payees to receive the proceeds of the cheques. Thus, all these payees were fictitious and the banks were entitled to treat all the cheques as payable to bearer. Teva’s conversion action must therefore fail.
2249740 Ontario Inc. v. Morguard Elgin Ltd., 2016 ONCA 100 [Feldman, Simmons and Miller JJ.A.]
Counsel: J Scott Maidment and Stephen Brown-Okruhlik, for the appellants Ronald F. Caza and Anne M. Tardif, for the respondent
Keywords: Real Property, Contracts, Commercial Leases, Termination, Collateral Oral Agreements, Summary Judgment
Facts: This is a companion endorsement to the court’s endorsement at 2015 ONCA 605 summarized here.
In September 2010, the parties entered into the lease of a historic building (the “Property”) to renovate and operate a restaurant. The Commencement Date for the lease and payment of rent was April 1, 2011. The agreement provided that if the landlord was of the opinion that it would be unable to deliver possession of all of the leased premises before the expiration of 6 months after the Commencement Date, the landlord would have the right to terminate the lease upon written notice and neither party would have any liability to the other.
Morguard intended to construct a commercial high-rise on its property adjacent to the Property and was seeking an anchor tenant, or else construction would not proceed. There was a risk that construction of the project would cause significant disruptions to the Property. Morguard subsequently identified a potential anchor tenant that was going through a number of difficulties.
As a result, the parties orally agreed to postpone the Commencement Date for “at least a year”. They then entered into negotiations for a Lease Amendment Agreement and Morguard secured its anchor tenant in October 2011. The negotiations continued until Morguard advised in writing that it was terminating the negotiations in December 2011 pursuant to the original agreement.
The motion judge granted summary judgment in favour of the tenant and found that the parties had made an oral agreement in February 2011 to extend the Commencement Date either for one year if no anchor tenant was secured, or for three years if one was secured by Morguard. On appeal, the Court of Appeal allowed the appeal, set aside the motion judge’s summary judgment in favour of the respondent and requested further written submissions to allow the court to determine the result on the basis of an oral agreement. This supplementary decision arises out of those further submissions.
- Whether Morguard was entitled to terminate the lease under Article 3.03 in December 2011.
Holding: In light of the granting of the appeal in the prior companion decision that set aside the motion judge’s summary judgment in favour of the respondent, summary judgment granted in favour of the respondent for breach of contract by the appellants and matter remitted to motion judge for quantification of damages.
1. No. The court found that Article 3.03 contained only one communication obligation for the landlord, which was to terminate the lease by written notice. It was clear from the text of Article 3.03 that the same temporal restriction on forming the opinion that the landlord could not deliver the possession of the premises also applied to the delivery of the written termination notice.
There was communication in February 2011 that Morguard would not deliver possession within six months of the Commencement Date. However, Morguard did not make use of Article 3.03 in accordance with terms of that provision. Therefore, the written termination notice that Morguard provided in December 2011 was beyond six months after April 1, 2011, and it was in breach of the lease. The court granted judgment in favour of the respondent for breach of contract by the appellants and remitted the matter back to the motion judge to quantify damages.
Barbour v. Bailey, 2016 ONCA 98, 2016 ONCA 98 [MacFarland, Rouleau and Roberts JJ.A.]
Counsel: Jeffrey E. Streisfield, for the appellant Izaak de Rijcke and Robert Fenn, for the respondent Sean Dewart, for the moving party/appellant on the costs appeal, Jeffrey E. Streisfield
Keywords: Real Property, Adverse Possession, Prescriptive Easement, Easement of Necessity, Proprietary Estoppel, Reasonable Apprehension of Bias, Limitation Period
Facts: The respondent, Mrs. Bailey, is the registered owner of Tiny Island, which is known as Part 1 on a reference plan. Mr. Barbour, the defendant/appellant, is the registered owner of the mainland property opposite Tiny Island. His land is designated as Parcel 10. Part 2 of Parcel 10 is the property in dispute in these proceedings. According to Mr. Barbour’s deed, his property extends to the water’s edge. Part 2 includes the beach in front of Mr. Barbour’s mainland property. It also comprises part of an isthmus that joins Tiny Island to the beach of Part 2 when the isthmus is above water. In December of 1988, Mrs. Bailey purchased Tiny Island. Mrs. Bailey also acquired various other small parcels of land to the north of Mr. Barbour’s property on Parts 3 to 8, including a registered right-of-way that provides access to Nottawasaga Bay from the concession road, and parking spots located on the property north of Part 2.
As a result of the fluctuating water levels, Tiny Island has at times been totally and at other times only partially surrounded by water. During periods of lower water levels, the isthmus joins Tiny Island to the beach of Part 2. Although it has been more convenient for the owners of Tiny Island to pass over the path on Part 2 of Mr. Barbour’s property, they have always had and still have access to Tiny Island without travelling over it. The Baileys, like the previous owners before them, have water access to the island by boat, by virtue of their ownership of, or registered rights-of-way over, the various parcels of Parts 3 to 8, including their right-of-way from the concession road to Nottawasaga Bay. Further, access to Tiny Island is possible by walking along the water’s edge of Part 2, rather than the path, and then passing by foot or wading over to Tiny Island. In September 1995, Mr. Barbour delivered a letter to the Baileys requiring them to sign a licence agreement and pay a $1 licence fee to travel over the part of his property. In 2004, Mrs. Bailey brought an application under the Land Titles Act. In her application, she claimed possessory title to, or alternatively, a prescriptive easement over, the entirety of Part 2 of Parcel 10, including but not limited to the path, beach, and isthmus. This application was allowed. It was held that Mrs. Bailey had established possessory title to all of Part 2. On appeal, a new trial was ordered. The new trial judge again granted judgment in favour of Mrs. Bailey. The trial judge found that Mrs. Bailey had acquired possessory title over the entirety of Part 2 of Mr. Barbour’s property by way of adverse possession or, alternatively, a prescriptive easement or right-of-way.
- Did the trial judge err in determining that Mrs. Bailey acquired possessory title over Part 2 of Mr. Bailey’s property by way of adverse possession?
- Did the trial judge err in determining that Mrs. Bailey acquired a prescriptive easement by finding an uninterrupted 20-year period of use?
- Did the trial judge err in finding an easement by necessity?
- Did the trial judge err in holding that an easement arose by way of proprietary estoppel?
- What is the proper location of the easement?
- Did the trial judge’s exclusion of evidence create trial unfairness for, and demonstrate the trial judge’s bias against, Mr. Barbour?
- Were Mrs. Bailey’s claims statute-barred because she should have known of the problems with her property boundaries when she purchased Tiny Island in 1988 and she sat on her rights until 2004?
Holding: Appeal allowed on the finding of adverse possession. Appeal partially allowed on the finding of an easement, as it is now limited to non-vehicular traffic in a specific area. Costs order also set aside.
- Yes. The trial judge erred in finding that Mrs. Bailey had demonstrated adverse possession because there was no effective exclusion of Mr. Barbour from Part 2 of his property. In order to establish adverse possession, the claimant’s possession must be open, notorious, constant, continuous, peaceful and exclusive of the right of the true owner for a ten-year statutory period. Although it was open to the trial judge to infer that the owners of Tiny Island intended to exclude all others from possession of Part 2, the trial judge erred in holding that Mrs. Bailey had effectively excluded Mr. Barbour from his own property for three reasons. First, the trial judge impliedly reversed the burden of establishing effective exclusion by suggesting that the onus was on Mr. Barbour to prove that he had not been dispossessed, rather than on the Baileys to prove that they had dispossessed him. Second, the trial judge failed to appreciate that a true owner does not need to exercise the same degree of control over his property as an adverse possession claimant must demonstrate. That Mr. Barbour did not use Part 2 of his property all of the time does not matter. Third, the Court of Appeal has held that even where the inconsistent use test does not apply, the effective exclusion of the true owner throughout the ten-year period remains a requirement to establish adverse possession. There was no evidence that Mr. Barbour was effectively excluded from his property in this case.
- Partly yes, partly no. The trial judge correctly found that Mrs. Bailey acquired an easement or right-of-way over the path on Part 2 of Mr. Barbour’s property by virtue of its use by Mrs. Bailey and her predecessors in title. However, she erred in failing to restrict Mrs. Bailey’s easement to the non-vehicular use that the owners of Tiny Island continuously made of the path during the required 20-year period. The use of motor vehicles over Part 2 falls short of the 20-year requisite period to establish an easement. The evidence did not establish any continuous 20-year period during which the previous owners and the Baileys drove over Part 2, even when the previous owners’ use of motor vehicles and the Baileys’ use is combined. Mr. Barbour could not have acquiesced to vehicular use of Part 2 when there were significant stretches of time when it did not occur. Moreover, Mrs. Bailey could not rely on the 20-year period during which the previous owners and her family used the path to access Tiny Island by foot in order to establish a prescriptive easement for the use of motor vehicles because to do so would substantially increase the burden on the servient tenement. Mrs. Bailey’s use should therefore be restricted to non-vehicular passage over the path on Part 2.
- Yes. The trial judge erred in concluding that an easement of necessity arose. While the trial judge was correct to find that Mrs. Bailey’s predecessors in title never relied exclusively on boat access to reach Tiny Island, in this case water access to the island is nonetheless possible and was used by the previous owners. The use of the path by foot was reasonably necessary for the owners’ enjoyment of their property. However, this does not prove necessity because Tiny Island was and is accessible by water, as well as by walking along the shoreline. It cannot be said that in the absence of an easement over Part 2, the Baileys would be left without a legally enforceable means of accessing Tiny Island.
- Yes. The trial judge erred in concluding that the doctrine of proprietary estoppel applied to this case. While the Baileys may have believed that they owned all or some of Part 2, the evidence establishes that their mistaken belief about their ownership of it was the product of their own failure to make appropriate inquiries. The trial judge correctly found that the Baileys’ mistake was unilateral. There was no evidence that Mr. Barbour was aware of the Baileys’ mistaken belief about their rights prior to their assertions of ownership in 1995 in response to his request that they pay a licence fee to travel over his beach. There was also no evidence that Mr. Barbour encouraged the improvements of the path and isthmus that the Baileys undertook in 1992 and 1993, or that he induced them to undertake the improvements they made to the cottage on Tiny Island soon after they bought it. In fact, the Baileys planned to renovate their property before meeting Mr. Barbour.
- Since the trial judge granted Mrs. Bailey title over all of Part 2 of Parcel 10, which was an area greater than the land that Mrs. Bailey and her predecessors in title continuously used for an uninterrupted period of 20 years, she did not make a finding as to the dimensions and location of the path used by Mrs. Bailey and her predecessors in title. It was not necessary for the Court of Appeal to remit this matter back to the trial judge or a surveyor to determine the exact dimensions and location of the right-of-way because the witnesses at the second trial as well as experts identified the path marked as “track” on the registered plan of survey was more or less the path that the owners of Tiny Island travelled on foot across Part 2 of Mr. Barbour’s property. Mrs. Bailey was therefore entitled to an easement in the nature of a right-of-way for non-vehicular passage on the path marked “track” on the plan of survey.
- No. The test for a reasonable apprehension of bias was not met. There were no particulars of bias alleged against the trial judge other than a very vague statement in Mr. Barbour’s factum that the trial judge’s pre-trial and mid-trial rulings demonstrated a bias in favour of the possessory claimant. None of the rulings indicated bias on the trial judge’s part against Mr. Barbour. Mr. Barbour also did not show how the omission of certain evidence from the trial has caused him any trial unfairness or prejudice.
- Not decided. Given the Court of Appeals reasons for allowing the appeal with respect to Mrs. Bailey’s claim for adverse possession, it was unnecessary to address Mr. Barbour’s argument on this aspect of the appeal.
Heng v. Rodriguez, 2016 ONCA 106 [Laskin, Simmons and Huscroft JJ.A.]
Counsel: Hashim Syed, for the appellants Brian Diamond, for the respondents
Keywords: Real Property, Adverse Possession, Boundary Dispute, Fence Line
Facts: Appellants challenge the application judge’s finding of adverse possession. The appellant submits that the application judge did not consider relevant evidence in coming to his decision.
- Did the application judge err in failing to make a finding on the ownership of the fence?
- Did the application judge err in finding sufficient usage of the strip of land in question?
Holding: Appeal Dismissed
- No to both. The court held that the application judge correctly stated the elements of a claim in adverse possession and he made findings of fact reasonably supported by the evidence to satisfy each element. The court agreed with the application judge’s ruling that the conduct of both parties indicated that both sides treated the fence line as a boundary line between them. The court also agreed with the application judge’s inference that all the backyard, including the strip in question, was “reasonably manicured”.
Chitsabesan v. Yuhendran, 2016 ONCA 103 [Juriansz, Hourigan and Brown JJ.A.]
Counsel: Steven M. Bookman, Gillian H. Bookman and Jasmine Jadubir, for the moving party/responding party by way of cross-motion Michael G. Weissenborn, for the responding party/moving party by way of cross-motion
Keywords: Family Law, Custody and Access
Facts: Please note that the appellant father’s second appeal in this family law matter summarized below can be found here.
The Superior Court of Justice upheld the decision of the Ontario Court of Justice awarding child custody to the respondent and allowing her to relocate to England with the child and returned access issues to the Ontario Court of Justice. The Ontario Court of Justice then restricted the appellant’s access to the child to six weeks a year in weekly blocks, with an exception for the summer.
The appellant moved for access to the child. Specifically, the appellant wanted to bring his daughter to Toronto to develop a close relationship with her paternal grandmother and other paternal relatives. Of note, the significant cost of airfare to exercise his access periods were particularly significant because, since the child was too young to travel alone, he was required fly to London, return with the child, fly back to London with the child and finally return to Toronto alone. Moreover, exercising access in England was difficult because of the cost of accommodation in London.
The respondent opposed the request as it would interfere with the child’s school attendance. Specifically, her teacher was not able to authorize a leave of absence “for the purpose of a family holiday”.
- Should the motion for access be allowed?
Holding: Yes. Motion Allowed
- Regardless of the school’s policy regarding an absence for parental access, it was not in the best interests of the child to consider school attendance more important than fostering a meaningful relationship with her father and his family. Indeed, it is always in the best interests of a child to have a healthy relationship with both parents. A compelling reason was required to show why longer periods of access were not appropriate, and this was not demonstrated.
Chitsabesan v. Yuhendran, 2016 ONCA 105 [Juriansz, Hourigan and Brown JJ.A.]
Counsel: Steven M. Bookman, Gillian H. Bookman and Jasmine Jadubir, for the appellant Michael G. Weissenborn, for the respondent
Keywords: Family Law, Custody and Access, Standard of Review, Jurisdiction, Family Law Rules, Rule 25(19)(c), Orders, Functus officio
Facts: Please note that the appellant father’s first appeal in this family law matter summarized above can be found here.
The appellant father appealed the lower court’s decision twice. He appealed the order awarding custody of the three year old daughter to the respondent mother who was relocating to England.
The first appeal judge affirmed the trial judge’s decision. However, the judge remitted the matter back to the trial judge to correct errors and inconsistencies in wording and to adjudicate matters that were not completely dealt with.
- What is the standard of review?
- Did the appeal judge err in reviewing the trial judge’s decision on custody and access?
- Did the appeal judge err by remitting the matter back to the trial judge?
Holding: Appeal allowed in part.
- According to Hickey v Hickey, the standard of review is narrow and requires a high level of deference in a family law appeal. The Supreme Court is clear that an appellate court can intervene in the trial judge’s decision if the judge erred in law or made a material error in the appreciation of the facts.
- No. The appeal judge did not err and properly reviewed the trial judge’s decision and reasons. The judge proceeded upon the proper legal framework and it was for the trial judge to determine how the maximum contact principle would be weighed in the case.
- Yes. The appeal judge did not have jurisdiction to remit the case back to the trial judge for further hearing. The appeal judge concluded that the trial judge erred in failing to determine whether any issue needs to be reheard and that a judge who is not functus officio can modify her decision. Rule 25(19)(c) of the Family Law Rules authorizes a judge to change an order. The appeal judge erred in two ways. First, the process to settle an order has a narrow purpose to ensure the formal order accurately sets out the intention of the court. This is done in rare circumstances and should not have been done in this case because the trial judge followed the proper process. Second, Rule 25(19)(c) only permits a court to change an order that needs to be changed to deal with a matter before the court but was not decided. Here, the appeal judge found the trial judge properly evaluated the law and applied the law. Rule 15(19)(c) had no application to this case.
R. c. Halich (Appeal Book Endorsement), 2016 ONCA 102 [Hoy A.C.J.O., Pardu et Roberts JJ.A]
Counsel: Khalid Halich, in person Cameron Fiske, amicus curiae Michael Fawcett and Philippe Cowle, for respondent
Keywords: Criminal Law, Agent, Paralegal, Client Instructions, New Trial
Criminal Law Decisions
Counsel: David W. Russell, for the appellant Dayna Arron, for the respondent
Keywords: Criminal Law, Dangerous Operation of a Vehicle, Leave to Appeal, Sentencing, Pre-Disposition Custody
R v. B.W., 2016 ONCA 96 [Weiler, Tulloch and Brown JJ.A.]
Counsel: Michael Davies and Meaghan McMahon, for the appellant Joanne Stuart, for the respondent
Keywords: Criminal Law, Assault, Unreasonable Verdict, Reasonable Double Standard Test, R. v. W. (D.), Expert Evidence, Consent, Defence of Deemed Consent, Excessive Force
R v. Becks, 2016 ONCA 91 [Weiler, Tulloch and Brown JJ.A.]
Counsel: Mark Halfyard, for the appellant Joanne Stuart, for the respondent
Keywords: Criminal Law, Sexual Offences, Evidence, Stereotypical Reasoning, Motive to Fabricate, Evidence of Minors
R v. Quick, 2016 ONCA 95 [Laskin, Gillese and van Rensburg JJ.A.]
Counsel: Breese Davies and Owen Goddard, for the appellant Roger Shallow, for the respondent
Keywords: Criminal Law, Dangerous Driving, Indefinite Suspension of Driver’s License, Highway Traffic Act, Plea, Miscarriage of Justice, Appeal Allowed
R v. Van Every, 2016 ONCA 87 [Laskin, Gillese and van Rensburg JJ.A.]
Counsel: Dirk Derstine and Janani Shanmuganathan, for the appellant Grace Choi, for the respondent
Keywords: Criminal Law, Second Degree Murder, Jury Instruction, Intent, Vetrovec Instructions, Sentencing, Parole Eligibility, Aboriginal Status, Gladue Report, Criminal Code, s. 718.2(e)
R v. Veysey, 2016 ONCA 97 [Gillese, Watt and Tulloch JJ.A.]
Counsel: Julie Santarossa and Jessyca Greenwood, for the appellant Marcy Henschel, for the respondent
Keywords: Criminal Law, Sexual Assault, Dangerous Offender Application, Impact of Age, Control in the Community
R v. Ricketts, 2016 ONCA 99 [Watt, Lauwers and Hourigan JJ.A]
Counsel: Erika Chozik and Benjamin Snow, for the appellant Christine E. Bartlett-Hughes, for the respondent
Keywords: Criminal Law, Domestic Violence, Sentencing, Pre-disposition Custody, Criminal Code, ss. 719(3), R. v. Summers, Appeal Granted
Counsel: James E. Dean, for the appellant Ruth McGuirl, for the respondent
Keywords: Criminal Law, Drug Trafficking, Intent, R. v. W. (D.), Sentencing
R v. Hromek, 2016 ONCA 109 [Gillese, Watt and Tulloch JJ.A.]
Counsel: Robert M. Isles, for the appellant David Friesen, for the respondent
Keywords: Criminal Law, Fraud, Misapprehension of Evidence, Sentencing, Probation, Criminal Code, s. 732.2(3)
R v. Jeanvenne, 2016 ONCA 101 [Weiler, Tulloch and Brown JJ.A.]
Counsel: Ian R. Smith and Amy J. Ohler, for the appellant Michael Bernstein, for the respondent
Keywords: Criminal Law, Murder, “Mr. Big”, R. v. Hart, Evidence, Admissibility, Jury Charge, Motive, Balanced Time, R. v. Baltovich, Appeal Allowed
R v. Warren, 2016 ONCA 104 [Laskin, Pardu and Roberts JJ.A.]
Counsel: Kristin Bailey, for the appellant Jessica Smith Joy, for the respondent
Keywords: Criminal Law, Sexual Interference, Prior Consistent Statements, Jury Instruction, Limiting Statements, Appeal Allowed
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