There were only two substantive civil decisions of the Court of Appeal this week. One dealt with a construction contract dispute. The other was a solicitor’s negligence action. In both matters, summary judgment was granted in the court below and the appeal was allowed. A reminder that summary judgment does not always avoid cost and delay.

Enjoy the weekend.

John Polyzogopoulos Blaney McMurtry LLP jpolyzogopoulos@blaney.com Tel: 416 593 2953 http://www.blaney.com/lawyers/john-polyzogopoulos

Table of Contents: 

Civil Decisions

2395446 Ontario Inc. v. King’s and Queen’s Custom Homes Inc., 2017 ONCA 782

Keywords: Contracts, Construction Law, Delay Claim, Penalty Clause, Extras, Evidence, Credibility, Misapprehension of Evidence, Summary Judgment

Butera v. Chown, Cairns LLP, 2017 ONCA 783

Keywords: Torts, Solicitors Negligence, Franchise Law, Arthur Wishart Act (Franchise Disclosure), S.O. 2000, c. 3, Civil Procedure, Limitation Periods, Appeals, Fram Elgin Mills 90 Inc. v. Romandale Farms Ltd., 2016 ONCA 404, Summary Judgment, Hryniak v. Mauldin, 2014 SCC 7, Baywood Homes Partnership v. Haditaghi, 2014 ONCA 450, Canadian Imperial Bank of Commerce v. Deloitte & Touche, 2016 ONCA 922

For Civil Endorsements, click here.

For Criminal Decisions, click here.

Civil Decisions

2395446 Ontario Inc. v. King’s and Queen’s Custom Homes Inc., 2017 ONCA 782

[Doherty, LaForme and Miller JJ.A.]

Counsel:

Gregory M. Sidlofsky, for the appellants

Benjamin Salsberg, for the respondents

Keywords: Contracts, Construction Law, Delay Claim, Penalty Clause, Extras, Evidence, Credibility, Misapprehension of Evidence, Summary Judgment

Facts:

The appellant, Nikolay Chsherbinin, entered into a construction management contract with the respondent, King’s and Queen’s Custom Homes Inc. (“KQ”), in which KQ agreed to manage the construction of improvements at Chsherbinin’s new law office. After the completion of the work, the appellants brought an action to recover alleged overpayments to the respondents, and for damages pursuant to a penalty clause for construction delays.

The appellants’ motion for summary judgment was unsuccessful and the motion and action were both dismissed.

Issues:

  1. Did the motion judge err in finding that there was no overpayment to KQ?
  2. Did the motion judge err in finding that the penalty clause for delay did not apply to the construction of a feature wall in the reception area?
  3. Did the appellants receive a fair hearing?

Holding: Appeal allowed.

Reasoning:

1. Yes. Chsherbinin claimed to have overpaid KQ by $9,322.29. The basis of the claim was that advance payments made by Chsherbinin at KQ’s request exceeded the amounts ultimately invoiced by KQ.

KQ then provided an account reconciliation that set out extra work requested by Chserbinin that largely accounted for the discrepancy. After the extra work was taken into account, there remained only a small overpayment from Chsherbinin of $677.79.

Chsherbinin, however, claimed the full $9,322.29 as an overpayment on the basis that the items referenced in the reconciliation email were not extras, as they had been included in the original contract. He further argued that he had not approved any extras in writing, as required by the contract.

The motion judge rejected this argument and found that Chsherbinin requested the work, received exactly what he asked for, and paid for what he received. However, as set out below, this was an error.

2. Yes. The motion judge found that the purpose of the penalty clause was to avoid Chsherbinin having to continue to pay rent in his former premises while waiting for his new premises to become move-in ready. The motion judge found, and it was uncontested, that Chsherbinin did move in to the new premises on April 2. The basis of Chserbinin’s delay claim is primarily that a feature wall in the reception area was not completed by April 2.

The motion judge made a finding that the contract did not require the installation of the feature wall by April 2.

Since the motion judge did not accept that the penalty clause applied to work that was not intended to be completed by April 2, the fact that there was delay in the installation of the feature wall was immaterial.

3. No. The motion judge was highly critical of Chsherbinin and the court found that his assessment of Chsherbinin’s evidence was impaired by two serious errors.

First, although the motion judge stated that there were several examples of “over-reaching” in Chsherbinin’s affidavit, he listed only the one that he said was the “most glaring”: that although Chsherbinin claimed in his affidavit that it was KQ’s principal, Sula Kogan, who drafted the penalty clause, he later contradicted himself on cross-examination by stating that he amended the penalty clause on his own computer in his office after discussions with Kogan.

However, the court found that the apparent contradiction was the product of the motion judge’s error in mixing up Chsherbinin and Kogan’s evidence on cross-examination.

Second, the motion judge faulted Chsherbinin for not disclosing a fifth invoice from KQ, which he thought to be material to the question of whether KQ had been paid in excess of the amount it had invoiced. However, the respondent conceded that there no fifth invoice from KQ, and the motion judge erred not only in finding there was, but in drawing an adverse inference against Chsherbinin for not producing it.

The court was satisfied that the motion judge’s strong, but unsupported findings against Chsherbinin’s credibility would have influenced his assessment of all of the issues before him. It held that this conclusion was supported by the motion judge’s inexplicable outright dismissal of Chsherbinin’s overpayment claim, despite KQ’s concession that there had been a small overpayment that was recoverable by Chsherbinin.

Butera v. Chown, Cairns LLP, 2017 ONCA 783

[Juriansz, Pepall and Miller JJ.A.]

Counsel:

N G Wilson, for the appellants

J D Campbell, for the respondents

Keywords: Torts, Solicitors Negligence, Franchise Law, Arthur Wishart Act (Franchise Disclosure), S.O. 2000, c. 3, Civil Procedure, Limitation Periods, Appeals, Fram Elgin Mills 90 Inc. v. Romandale Farms Ltd., 2016 ONCA 404, Summary Judgment, Hryniak v. Mauldin, 2014 SCC 7, Baywood Homes Partnership v. Haditaghi, 2014 ONCA 450, Canadian Imperial Bank of Commerce v. Deloitte & Touche, 2016 ONCA 922

Facts:

The appellant, Luciano Butera, is the sole owner and operator of the appellant, 1515404 Ontario Inc., a Mitsubishi Motors franchisee operating as Niagara Mitsubishi, and of the appellant, Canterra Property Holdings Inc. (collectively referred to as the appellants). When their dealership failed, the appellants sued various Mitsubishi companies (“Mitsubishi”) for damages for breach of contract, misrepresentation, negligence, and breaches of the provisions of the Arthur Wishart Act (Franchise Disclosure, 2000), S.O. 2000, c. 3.

Mitsubishi moved for summary judgment on the basis that the applicable two-year limitation period had expired. The appellants conceded that the applicable limitation period was two years. Justice Hambly granted summary judgment to Mitsubishi and dismissed the appellants’ action. The appellants appealed from Hambly J.’s dismissal of their action and asked that the judgment be set aside. In their grounds for appeal, among other things, they took the position for the first time that a six-year limitation period was applicable. Mitsubishi successfully moved to strike that ground of appeal on the basis that the appellants had raised a new issue that they had not advanced before Hambly J. The Court of Appeal then dismissed the appellants’ appeal. It agreed with Hambly J. that the action was time-barred by the two-year limitation period.

The appellants then sued the respondents, their solicitors in the action against Mitsubishi, for negligence. The appellants stated that in the original action, the respondents had failed to take the position that a six-year limitation period applied rather than the two years found by Hambly J. Accordingly, they had lost the opportunity on appeal to argue the merits of their claims against Mitsubishi. They claim $5 million in damages flowing from their lost opportunity to argue the merits of their claims in negligence, misrepresentation, breach of contract, and breaches of the Arthur Wishart Act.

The respondents argued that the appellants did not appeal Hambly J.’s misrepresentation conclusion and therefore there could be no lost opportunity. Justice Belobaba agreed with the respondents’ position and therefore allowed the respondents’ motion for partial summary judgment and dismissed the damages claim. The partial summary judgment was appealed.

Issues:

(1) Did the motion judge err in concluding that the appellants had not appealed the misrepresentation finding?

(2) Did the motion judge err in failing to consider the advisability of an award of partial summary judgment?

Holding: Appeal allowed.

Reasoning:

(1) Yes. The motion judge erred in law in framing the issue as an analysis of whether there was an appeal from the “finding” of no misrepresentation. While issue estoppel may be based on reasons alone, an appeal is from an order or a judgment, not from the reasons for decision: Fram Elgin Mills 90 Inc. v. Romandale Farms Ltd., 2016 ONCA 404, at para. 33; and Glennie v. McD. & C. Holdings Ltd., [1935] S.C.R. 257, at p. 268. Here, the appellants appealed from the judgment of Hambly J. and asked that it be set aside. As a matter of law, this included the claims based on misrepresentation. To the extent that the notice of appeal lacked specific detail, it was implicit that the appellants were appealing the judgment that encompassed misrepresentation. The appellants’ factum filed before the Court of Appeal was replete with references to misrepresentation. No one would have been caught by surprise.

(2) Yes. The motion judge made an extricable error in principle in failing to consider whether partial summary judgment was appropriate in the context of the litigation as a whole. As the appellants point out, the action is proceeding to trial on the Arthur Wishart Act claims, which include allegations of a breach of the duty of fair dealing and deficient disclosure, the claims in negligence, and for breach of contract. These claims are intertwined with the misrepresentation claims. An award of partial summary judgment in these circumstances may lead to inconsistent results to the extent the misrepresentation claims were not barred due to a limitation period. On the other hand, had the litigation as a whole been considered, partial summary judgment would not have been an appropriate award as it would not serve the objectives of proportionality, efficiency, and cost effectiveness.

Since Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87, the Court of Appeal has considered partial summary judgment in Baywood Homes Partnership v. Haditaghi, 2014 ONCA 450, and in Canadian Imperial Bank of Commerce v. Deloitte & Touche, 2016 ONCA 922. A motion for partial summary judgment should be considered to be a rare procedure that is reserved for an issue or issues that may be readily bifurcated from those in the main action and that may be dealt with expeditiously and in a cost effective manner.

In addition to the danger of duplicative or inconsistent findings considered in Baywood and CIBC, partial summary judgment raises further problems that are anathema to the stated objectives underlying Hryniak. First, such motions cause the resolution of the main action to be delayed. Typically, an action does not progress in the face of a motion for partial summary judgment. Second, a motion for partial summary judgment may by very expensive. Third, judges, who already face a significant responsibility addressing the increase in summary judgment motions that have flowed since Hryniak, are required to spend time hearing partial summary judgment motions and writing comprehensive reasons on an issue that does not dispose of the action. Fourth, the record available at the hearing of a partial summary judgment motion will likely not be as expansive as the record at trial, therefore increasing the danger of inconsistent findings. Lastly, a motion for partial summary judgment differs from a motion for summary judgment. If the latter is granted, subject to appeals, it results in the disposal of the entire action.

Short Civil Endorsements

Tracy v. Iran (Information and Security), 2017 ONCA 777

[Hoy A.C.J.O., Blair and Hourigan JJ.A.]

Counsel:

Colin Stevenson and J. Daniel McConville for the appellants

John Adair and Gordon McGuire for the respondents, Tracy and Bennett

John B. Laskin, Sarah Whitmore, Eliot Che for the respondents, Marthaler, Holland and American Center for Civil Justice, Inc.

Jacqueline Dais-Visca, and Joseph Cheng for the intervener, the Attorney General of Canada

Keywords: Costs Endorsement, Partial Indemnity

Deltro Group Ltd. v. Potentia Renewables Inc., 2017 ONCA 784

[Sharpe, Blair and Epstein JJ.A.]

Counsel:

William Brock and Maureen Littlejohn, for the moving party

Michael Mazzuca, for the responding party

Keywords: Civil Procedure, Appeals, Jurisdiction, Orders, Final or Interlocutory, Courts of Justice Act R.S.O. 1990. C. C. 43, ss. 6(1)(b) and 19(1)(b), Ontario Medical Association v. Miller, [1976] 14 O.R. (2d) 468, Appeal Quashed

McAfee v. McAfee, 2017 ONCA 785

[Sharpe, Blair and Epstein JJ.A.]

Counsel:

Robert McAfee, acting in person

Erin MacKenzie, for the respondent

Keywords: Family Law, Offers to Settle, Severability Clauses, Inadvertent Error, Milos v. Zagas,[1998] 38 O.R. (3d) 218, Appeal Dismissed

Ontario (Attorney General) v. Reyes, 2017 ONCA 786

[Sharpe, Blair and Epstein JJ.A.]

Counsel:

Althea Reyes, acting in person

Domenico Polla, for the respondent

Keywords: Civil Procedure, Vexatious Litigants, Courts of Justice Act, s. 140

Criminal Decisions:

R v. Overland, 2017 ONCA 776

[Pepall, van Rensburg and Fairburn JJ.A.]

Counsel:

Gay Overland, acting in person

Peter Fraser, for the respondent

Keywords: Criminal Law, Sentencing, Ineffective Assistance of Trial Counsel

R v. Tang, 2017 ONCA 775

[Brown J.A. (In Chambers)]

Counsel:

Andrew Burgess, for the appellant

Amy Alyea, for the respondent

Keywords: Criminal Law, Drug-trafficking, Sentencing, Judicial Interim Release, Surveillance, Public Interest Criterion, Criminal Code s. 679(3)(c), Canadian Charter of Rights and Freedoms s. 8 ,R. v. Oland, 2017 SCC 17

R v. Jarvis, 2017 ONCA 778

[Feldman, Watt and Huscroft JJ.A.]

Counsel:

Christine Bartlett-Hughes and Jennifer Mannen, for the appellant

Susan M. Chapman and Jennifer Micallef, for the respondent

Keywords: Criminal Law, Voyeurism, Criminal Code, s. 162(1)(c), s. 162, s. 676(1)(a), Canadian Charter of Rights and Freedoms s. 8, s. 24(2), Reasonable Expectation of Privacy, R. v. Grant, 2009 SCC 32, [2009] 2 S.C.R. 353, R. v. Sharpe, 2001 SCC 2, R. v. Morrisey, 2011 ABCA 150, R. v. Colley, 2009 BCCA 289, R. v. M.B., 2014 QCCA 1643, R. v. Lebenfish, 2014 ONCJ 130, R. v. Villaroman, 2016 SCC 33, R. v. Taylor, 2015 ONCJ 449, R. v. Cole, 2012 SCC 53, Polius; R. v. Manley, 2011 ONCA 128, R. v. B.-H., 2013 ONSC 1183; R. v. Rafferty, 2012 ONSC 703; R. v. Morelli, 2010 SCC 8, Polius; R. v. Fearon, 2010 ONCJ 645, R. v. Harrison, 2009 SCC 34, R. v. Buhay, 2003 SCC 30

R v. R.B., 2017 ONCA 779 (Publication Ban)

[van Rensburg, Pardu and Fairburn JJ.A.]

Counsel:

R.B., in person

Amy Ohler appearing as duty counsel

Lorna Bolton, for the respondent

Keywords: Criminal Law, Sexual Assault, Evidence, Credibility

R v. Bennett, 2017 ONCA 780

[Doherty, Huscroft and Miller JJ.A.]

Counsel:

Diana M. Lumba and Carlos F. Rippell, for the appellant

John Patton, for the respondent

Keywords: Criminal Law, Firearms, Telewarrant, Confidential Informant, Disclosure Request, Disclosure Order, Information to Obtain (“ITO”), Canadian Charter of Rights and Freedoms, s. 8, s. 9, s.24(2), R. v. Garofoli, [1990] 2 S.C.R. 1421, R. v. Crevier, 2015 ONCA 619, R. v. Stinchcombe, [1991] 3 S.C.R. 326, R. v. McNeil, 2009 SCC 3, R. v. Davey, 2012 SCC 75, R. v. Reid, 2016 ONCA 524, World Bank Group v. Wallace, 2016 SCC 15, R. v. Lising, 2005 SCC 66, R. v. Green, 2015 ONCA 579, R. v. Grant, 2009 SCC 32, R. v. Ansari, 2015 ONCA 575

R v. Doodnaught, 2017 ONCA 781 (Publication Ban)

[Watt, Lauwers and Huscroft JJ.A.]

Counsel:

Diana M. Lumba and Carlos F. Rippell, for the appellant

John Patton, for the respondent

Keywords: Criminal Law, Sexual Assault, Sufficiency of Reasons, Similar Fact Evidence, R. v. Ferianz, [1962] O.W.N. 40 (C.A.), R. v. Minhas (1986), 29 C.C.C. (3d) 193 (Ont. C.A.), R. v. Davison(1974), 20 C.C.C. (2d) 424 (Ont. C.A.), R. v. Imrich, [1978] 1 S.C.R. 622, R. v. Morrissey (1995), 97 C.C.C. (3d) 193 (Ont. C.A.), R. v. Sinclair, 2011 SCC 40, R. v. Dinardo, 2008 SCC 24, R. v. Handy, 2002 SCC 56, R. v. Arp, [1998] 3 S.C.R. 339, R. v. Thomas (2004), 190 C.C.C. (3d) 31 (Ont. C.A.)

R v. Osinfolarin, 2017 ONCA 787

[van Rensburg, Pardu and Fairburn JJ.A.]

Counsel:

Oluwaseye Osinfolarin, acting in person

Ian R. Smith, duty counsel

Scott Wheildon, for the respondent

Keywords: Criminal Law, Drug Importation, Jury Selection

R v. Silva, 2017 ONCA 788

[van Rensburg, Pardu and Fairburn JJ.A.]

Counsel:

Eduardo Silva, acting in person

Ian R. Smith, appearing as duty counsel

Lorna Bolton, for the respondent

Keywords: Criminal Law, Robbery with a Firearm, Possession of a Restricted Firearm, Search Warrant, Information to Obtain (“ITO”), Canadian Charter of Rights and Freedoms, s. 8, s. 24(2), R. v. Grant, 2009 SCC 32, R. v. McGuffie, 2016 ONCA 365