Good afternoon.

Following are our summaries of the civil decisions of the Court of Appeal for Ontario for the week of June 21, 2021.

In Manastersky v. Royal Bank of Canada, the Court dealt with a wrongful dismissal appeal on damages that was remanded by the Supreme Court of Canada with the directive of applying the recent decision of Matthews v. Ocean Nutrition Canada Ltd., 2020 SCC 26. The Court affirmed its original decision.

In Moore v. 7595611 Canada Corp., the Court refused to set aside the damage awards the jury made at trial. Of note, the Court refused to reduce an award for loss of care, guidance and companionship, despite it exceeding the “upper limit” prescribed in To v. Toronto Board of Education (2001), 204 D.L.R. (4th) 704 (Ont. C.A.). The Court held that since the award did not “shock the conscience of the court” it should not be reduced.

In Krebs v. Cote, the Court refused to extend to cohabitation agreements the rule that provides that a separation agreement becomes void upon reconciliation of the parties.

In Bayford v Boese, the Court found that the trial judge erred in finding that the respondent had discharged her burden to prove the formal validity of the will due to a misapprehension of the content and significance of expert evidence.

Other topics covered this week included subrogation rights of an insurer to SABs, the admission of fresh expert evidence in a medmal matter resulting in the setting aside of summary judgment dismissing the claim, breach of contract in respect of consulting services, the refusal of leave to appeal in the Laurentian University CCAA proceeding, contempt in the custody and access context, the negligence of a landlord in respect of the death of a tenant in a house fire, mitigation in respect of a claim for breach of an APS of land and extension of time to perfect an appeal in the family law context.

Table of Contents

Civil Decisions

Burns v. Brown, 2021 ONCA 450

Keywords: Family Law, Civil Procedure, Appeals, Perfection of Appeal, Extension of Time, Rules of Civil Procedure, Rule 61.05(5), Issasi v. Rosenzweig, 2011 ONCA 112

El-Khodr v. Northbridge Commercial Insurance Company , 2021 ONCA 440

Keywords: Torts, Negligence, MVA, Statutory Accident Benefits, Subrogation, Assignment, Contracts, Interpretation, Minutes of Settlement, Insurance Act, R.S.O. 1990, c. I.8, s. 267.8, Statutory Accident Benefits Schedule, O. Reg. 34/10, El-Khodr v. Lacki 2017 ONCA 716, 139 O.R. (3d) 659, leave to appeal refused, [2017] S.C.C.A. No. 461, El-Khodr v. Lackie, 2015 ONSC 5244, 79 C.P.C. (7th) 356, Carroll v. McEwen, 2018 ONCA 902, Cadieux v. Cloutier, 2018 ONCA 903, leave to appeal to refused, [2019] S.C.C.A. No. 63, Gilbert v. South, 2014 ONSC 3485, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Environs Wholesale Nursery LTD. v. Environs Landscape Contracting LTD., 2019 ONCA 547, 3113736 Canada Ltd. v. Cozy Corner Bedding Inc., 2020 ONCA 235, Angus v. Port Hope (Municipality), 2017 ONCA 566, leave to appeal refused, [2017] S.C.C.A. No. 382

Bayford v. Boese , 2021 ONCA 442

Keywords: Wills and Estates, Wills, Formal Validity, Civil Procedure, Expert Evidence, Fresh EvidenceSuccession Law Reform Act, R.S.O. 1990, c. S.26, s. 4(1), Housen v. Nikolaisen, 2002 SCC 33, R. v. Morrissey (1995), 97 C.C.C. (3d) 193 (Ont. C.A.), Waxman v. Waxman, 2004 CanLII 39040, leave to appeal refused, [2004] S.C.C.A. No. 291; Carmichael v. GlaxoSmithKline Inc., 2020 ONCA 447, leave to appeal refused, [2020] S.C.C.A. No. 409, Vout v. Hay, [1995] 2 S.C.R. 876, Palmer v. The Queen, [1980] 1 S.C.R. 759, Sengmueller v. Sengmueller (1994), 111 D.L.R. (4th) 19 (Ont. C.A.)

Pichelli v. Kegalj , 2021 ONCA 445

Keywords: Torts, Fraud, Deceit, Misrepresentation, Breach of Trust, Unjust Enrichment, Civil Procedure, Summary Judgment, Fresh Evidence, Rules of Civil Procedure, Rules 20.04(2.1), 20.04(2.2), 21, 25, 25.06(8), Hryniak v. Mauldin, 2014 SCC 7, Trotter Estate, 2014 ONCA 841, Royal Bank of Canada v 164397 Ontario Inc, 2021 ONCA 98, Sengmueller v. Sengmueller, 1994 111 D.L.R. (4th) 19 (Ont. C.A.)

Johnson v. Rajanna, 2021 ONCA 453

Keywords: Torts, Negligence, Medmal, Dentists, Civil Procedure, Summary Judgment, Expert Evidence, Standard of Care, Adjournments, Fresh Evidence, Experts, Expert Report, Rules of Civil Procedure, Rule 53.03(2.1), R. v. Palmer, [1980] 1 S.C.R. 759

Laurentian University of Sudbury (Re), 2021 ONCA 448

Keywords: Bankruptcy and Insolvency, Restructuring, Notice of Disclaimer, Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-3, Laurentian University of Sudbury v. University of Sudbury, 2021 ONSC 3392, Laurentian University of Sudbury (Re), 2021 ONCA 199, 9354-9186 Québec inc. v. Callidus Capital Corp., 2020 SCC 10, Edgewater Casino Inc. (Re), 2009 BCCA 40, Nortel Networks Corp. (Re), 2016 ONCA 332

Manastersky v. Royal Bank of Canada, 2021 ONCA 458

Keywords: Contracts, Employment, Wrongful Dismissal, Reasonable Notice, Damages, Supreme Court Act, R.S.C. 1985, c. S-26, s. 43(1.1), Manastersky v. Royal Bank of Canada, 2019 ONCA 609, Matthews v. Ocean Nutrition Canada Ltd., 2020 SCC 26, Paquette v. TeraGo Networks Inc., 2016 ONCA 618, Lin v. Ontario Teachers’ Pension Plan, 2016 ONCA 619, Taggart v. Canada Life Assurance Co. (2006), 50 C.C.P.B. 163 (Ont. C.A.)

Krebs v. Cote , 2021 ONCA 467

Keywords: Family law, Contracts, Interpretation, Cohabitation Agreements, Separation, Reconciliation, Civil Procedure, Summary Judgment, Determination of Question of Law, Family Law Act, RSO 1990, c. F3, ss 52 to54, Family Law Rules, Rule 16(12)(a), Montague Lush and Walter Hussey Griffith, Law of Husband and Wife within the Jurisdiction of the King’s Bench & Chancery Divisions, 3rd ed. (London: Stevens and Sons, Limited, 1910), Creston Moly Corp. v. Sattva Capital Corp., 2014 SCC 53, Ernikos v. Ernikos, 2017 ONCA 347, Sydor v. Sydor (2003), 178 O.A.C. 155 (C.A.), Bailey v. Bailey (1982), 37 O.R. (2d) 117 (C.A), Bebenek v. Bebenek (1979), 24 O.R. (2d) 385 (C.A.), Nicol v. Nicol (1885), 30 Ch. D. 143, Langdon v. Langdon, 2015 MBQB 153, Sandrelli v. Sandrelli, 2015 ONSC 7913, Hartshorne v. Hartshorne, 2004 SCC 22

Leslie v. Encanto Potash Trading Corporation, 2021 ONCA 464

Keywords: Contracts, Breach of Contract, Summary Judgment, Evidence, Cross-appeal, Costs, Interlocutory Appeal, Courts of Justice Act, R.S.O. 1990, c.43, Section 6(2), Rules of Civil Procedure, Rule 39.03

Moncur v. Plante, 2021 ONCA 462

Keywords: Family Law, Custody and Access, Civil Procedure, Orders, Enforcement, Civil Contempt, Carey v. Laiken, 2015 SCC 17, Greenberg v. Nowack, 2016 ONCA 949, Chong v. Donnelly, 2019 ONCA 799, Valoris pour enfants et adultes de Prescott-Russell c.K.R., 2021 ONCA 366, Ruffolo v. David, 2019 ONCA 385

Moore v. 7595611 Canada Corp., 2021 ONCA 459

Keywords: Torts, Negligence, Occupier’s Liability, Standard of Care, Damages, Mental Distress, Loss of Care, Guidance, and Companionship, Cost of Future Care, Civil Procedure, Jury Selection, Fresh Evidence, Juries Act, R.S.O. 1990, c. J.3, s. 44(1), Fire Protection and Prevention Act, 1997, S.O. 1997, c. 4, s. 76, Fire Code, O. Reg. 213/07, Fatal Accidents Act, R.S.A. 2000, c. F-8, s. 8(2), To v. Toronto Board of Education (2001), 204 D.L.R. (4th) 704 (Ont. C.A.), Young v. Bella, 2006 SCC 3, Hill v. Church of Scientology of Toronto, [1995] 2 S.C.R. 1130, Fiddler v. Chiavetti, 2010 ONCA 210, Vokes Estate v. Palmer, 2012 ONCA 510, Rodrigues v. Purtill, 2019 ONCA 740, Gervais v. Richard (1984), 48 O.R. (2d) 191 (H.C.), Mason v. Peters (1982), 139 D.L.R. (3d) 104 (Ont. C.A.), Rodrigues v. Purtill, 2019 ONCA 740, Palmer v. The Queen, [1980] 1 S.C.R. 759

Tribute (Springwater) Limited v. Atif, 2021 ONCA 463

Keywords: Contracts, Real Property, Agreements of Purchase and Sale of Land, Damages, Mitigation, Prejudgment Interest, Postjudgment Interest, Rules of Civil Procedure, Rule 25.06(9)(b), Courts of Justice Act, RSO 1990, c C43, ss 127, 128, 129, 130(1) and 130(2), Southcott Estates Inc. v. Toronto Catholic District School Board, 2012 SCC 51, 100, Main Street East Ltd. v. W.B. Sullivan Construction Ltd. (1978), 20 O.R. (2d) 401 (C.A.), 642947 Ontario Ltd. v. Fleischer (2001), 56 O.R. (3d) 417 (C.A.), Tribute (Springwater) Limited v. Sumera Anas, 2020 ONSC 5277, McKnight v. Ontario (Transportation), 2018 ONSC 52, Gyimah v. Bank of Nova Scotia, 2013 ONCA 252, Bank of America Canada v. Mutual Trust Co., 2002 SCC 43, Tilden Rent-A-Car Co. v. Clendenning (1978), 18 O.R. (2d) 601 (C.A.), MacQuarie Equipment Finance Ltd. v. 2326695 Ontario Ltd. (Durham Drug Store), 2020 ONCA 139, Forest Hill Homes v. Ou, 2019 ONSC 4332

CIVIL DECISIONS

Burns v. Brown, 2021 ONCA 450

[Brown J.A. (Motions Judge)]

COUNSEL:

J.A.B., acting in person C. Doris, for the responding party Keywords: Family Law, Civil Procedure, Appeals, Perfection of Appeal, Extension of Time, Rules of Civil Procedure, Rule 61.05(5), Issasi v. Rosenzweig, 2011 ONCA 112

FACTS:

The appellant brought a motion seeking an order to extend the time for the perfection of his appeal. The parties agreed to a settlement conference in March 2020. However, that conference was delayed due to the pandemic. Court timelines were reinstated on July 16, 2020, but the appellant did not contact the court to renew his request for a settlement conference until November 2020. Although the appellant did not receive a response until May 14, 2021, on January 4, 2021, the court sent the parties a Notice of Intention to Dismiss Appeal for Delay if the appeal was not perfected by April 27, 2021. The appellant deposed that he did not receive this notice. The respondent no longer consented to a settlement conference. Therefore, Benotto J.A. advised the appellant that he must perfect his appeal by May 25, 2021. The appellant could not do so because he unilaterally suspended preparation of the trial transcript. The appellant reinstated the request for the transcripts and anticipated delivery by the end of June 2021.

ISSUES:

(1) Would it be just under the circumstances to grant the appellant’s request for an extension of time to perfect his appeal?

HOLDING:

Motion dismissed.

REASONING:

(1) No. The appellant did not provide an adequate explanation for the delay. The court stated in January 2020 that to hold a settlement conference, the Joint Request for Pre-hearing Settlement Conference form had to be submitted, which it was not. Further, the appellant had breached Rule 61.05(5) of the Rules of Civil Procedure because the respondent did not consent to the suspension of the request for transcripts. This unilateral act materially contributed to the delay. In addition, the appellant did not act prudently when court timelines were reinstated in July 2020. He waited months to follow up with the court and then waited until May 2021 for a response. There was also evidence that the appellant used several delay tactics at trial that amounted to litigating in bad faith. The court also considered the merits of the appeal in determining if an extension ought to be granted. There was no evidence that the trial judge made a palpable and overriding error. The trial judge dealt with both the amount of child support and parenting time at length. The appellant’s notice of appeal did not identify any legal or factual errors made by the trial judge. Therefore, the merits to the appeal were weak and the prejudice to the appellant did not outweigh the lack of reasonable explanation for the delay.


El-Khodr v. Northbridge Commercial Insurance Company, 2021 ONCA 440

[Doherty, Pepall and Thorburn JJ.A.]

COUNSEL:

J. Y. Obagi and E. A. Quigley for the appellant H. Klein, for the respondent Keywords: Torts, Negligence, MVA, Statutory Accident Benefits, Subrogation, Assignment, Contracts, Interpretation, Minutes of Settlement, Insurance Act, R.S.O. 1990, c. I.8, s. 267.8, Statutory Accident Benefits Schedule, O. Reg. 34/10, El-Khodr v. Lacki 2017 ONCA 716, 139 O.R. (3d) 659, leave to appeal refused, [2017] S.C.C.A. No. 461, El-Khodr v. Lackie, 2015 ONSC 5244, 79 C.P.C. (7th) 356, Carroll v. McEwen, 2018 ONCA 902, Cadieux v. Cloutier, 2018 ONCA 903, leave to appeal to refused, [2019] S.C.C.A. No. 63, Gilbert v. South, 2014 ONSC 3485, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, Environs Wholesale Nursery LTD. v. Environs Landscape Contracting LTD., 2019 ONCA 547, 3113736 Canada Ltd. v. Cozy Corner Bedding Inc., 2020 ONCA 235, Angus v. Port Hope (Municipality), 2017 ONCA 566, leave to appeal refused, [2017] S.C.C.A. No. 382

FACTS:

In Ontario, parties injured in an automobile accident can receive “no fault” first-party benefits through receipt of statutory accident benefits (“SABs”). SABs provide a person injured in an accident, (whether or not) they are at fault, access to medical, rehabilitation, and other benefits to assist with their recovery. An injured person may also bring a legal action against the “at fault” driver in tort (“the tort defendant”). The appellant suffered catastrophic injuries in a motor vehicle accident. The appellant’s insurer was Royal & Sun Alliance Insurance Company of Canada (“Royal”). The respondent, Northbridge Commercial Insurance Company (“Northbridge”), was the insurer for the tort defendant and conducted the defence on the tortfeasor’s behalf. The jury awarded the appellant substantial damages payable by the tortfeasor. The respondent, as insurer for the tortfeasor, sought an assignment of certain accident benefits payable by Royal to the appellant. While the trial judge assigned some benefits, the assignment of benefits for future medication and assistive devices and future professional services was denied. The respondent appealed the decision (“the Assignment Appeal”). After the Assignment Appeal was heard, Royal, the respondent, and the appellant entered into Minutes of Settlement. Under the Minutes of Settlement, Royal settled $385,000 into a trust for the benefit of the appellant and the respondent in “full and final satisfaction of any and all entitlement to medical and rehabilitations benefits.” The Minutes of Settlement provided that the sum would be held by Hughes Amys LLP, counsel to the respondent, and released either to the appellant or the respondent depending on the outcome of the Assignment Appeal. Specifically, the respondent would receive the funds “in the event that the said appeal is allowed and an assignment of Kossay El-Khodr’s entitlement to medical and rehabilitation benefits is granted to Northbridge.” In September 2017, the Assignment Appeal was granted, and the court ordered that the amounts payable be assigned to the respondent. The appellant argued that in the Assignment Appeal, the court did not order “assignment of Mr. El-Khodr’s entitlement of medical and rehabilitation benefits” as it assigned only part of those benefits and, as such, the second precondition to the transfer of funds was not satisfied. The application judge rejected this argument and held that the conditions set out in the Minutes of Settlement were met.

ISSUES:

(1) Did the application judge make a palpable and overriding error of fact or an extricable error of law in failing to properly construe the preconditions for payment to Northbridge in the Minutes of Settlement?

HOLDING:

Appeal dismissed.

REASONING:

(1) No To assess whether the application judge erred in her interpretation of the Minutes of Settlement, it was necessary to understand (a) the available approaches to the assignment of the SABs benefits, (b) the background facts and terms of the Minutes of Settlement, (c) the decision of the Court on the Assignment Appeal, and (d) the reasons of the application judge. A. The Available Approaches to the Assignment of SABs One of the methods to address the overlap between damages awarded and SABs received is the “silo” approach. Which only includes three broad categories of SABs under the Insurance Act: income replacement benefits, health care benefits, and other pecuniary losses. Under the “silo” approach, tort damages are only required to match generally with a corresponding SABs category. In Carroll and Cadieux, the court adopted the “silo” approach to the treatment and matching of SABs to tort damages under section 267.8 of the Insurance Act. Carroll and Cadieux were rendered after the Assignment Appeal was decided in September 2017. B. Background Facts In January 2007, the appellant was awarded damages for an action against the tortfeasor. After the verdict, no SABs relating to future professional services and medications and assistive devices were assigned. In denying the assignment of these benefits, the trial judge reasoned those benefits should be assigned only if the plaintiff’s entitlement to such benefits is certain and that the plaintiff received compensation for the same benefits in the tort judgment. The trial judge found that “the Defendants are now unable to meet their onus to demonstrate that the jury award compensated the Plaintiff for the same loss in respect of which the Defendants now claim an assignment of benefits.” In its Supplementary Notice of Appeal, the respondent argued that the approach taken by the trial judge effectively allowed double recovery and took the position that the “silo” approach to the assignment of accident benefits should be taken. The appellant took the position that the match approach should be followed. C. Disposition of the Assignment Appeal The Court rendered its judgment in the Assignment Appeal on September 19, 2017. The Court allowed the appeal and amended the trial judge’s order so that Royal’s future payments to the appellant for medication and assistive devices up to a total of $82,429.00 (i.e., the amount the jury had awarded for medication and assistive devices) and future payments for specified professional services up to a total of $424,550.00 (i.e., the amount the jury had awarded for professional services) be assigned to the respondent. D. The Application Judge’s Order The issue in this appeal turned upon the interpretation of a contract. The appellant had to establish a palpable and overriding error of fact or an extricable error of law. Such errors include the application of an incorrect principle, the failure to consider a required element of a legal test, or the failure to consider a relevant factor: Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633, at paras. 52-53. The application judge was correct to hold the terms of the Minutes of Settlement were satisfied and the contract was not frustrated because the only issue on the Assignment Appeal was the assignment of the appellant’s entitlement to future benefits for medications and assistive devices, and for professional services. The parties understood, when the Minutes of Settlement were signed, that because of the Assignment Appeal, these benefits would either be assigned to Northbridge or the trial judge’s decision not to assign these benefits would be upheld. The appellant was aware that the amount in the Minutes of Settlement was a full and final settlement subject only to the outcome of the Assignment Appeal and the Assignment Appeal was only in respect of future medication and assistive device and professional services. The application judge did not order the assignment of all settlement amounts for these benefits. The application judge only assigned medical and rehabilitation benefits in the amount of $385,000 as per the Minutes of Settlement. The appellant was awarded and paid $82,429 for future medication and assistive devices and $424,550 for professional services before the settlement was reached. Those sums exceeded the $385,000 settlement amount for medical and rehabilitation benefits set out in the Minutes of Settlement by $121,979. For these reasons, the court did not agree with the appellant’s argument that the outcome of the Assignment Appeal was not contemplated by the parties at the time they entered the Minutes of Settlement and, thus, the settlement agreement was frustrated. The application judge’s interpretation was consistent with the reasoning of the Court on the Assignment Appeal.


Bayford v. Boese, 2021 ONCA 442

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

COUNSEL:

E.A. Cherniak, Q.C., I.M. Hull and D. Lok Yin So, for the appellant T. Simmonds, for the respondent Keywords: Wills and Estates, Wills, Formal Validity, Civil Procedure, Expert Evidence, Fresh EvidenceSuccession Law Reform Act, R.S.O. 1990, c. S.26, s. 4(1), Housen v. Nikolaisen, 2002 SCC 33, R. v. Morrissey (1995), 97 C.C.C. (3d) 193 (Ont. C.A.), Waxman v. Waxman, 2004 CanLII 39040, leave to appeal refused, [2004] S.C.C.A. No. 291; Carmichael v. GlaxoSmithKline Inc., 2020 ONCA 447, leave to appeal refused, [2020] S.C.C.A. No. 409, Vout v. Hay, [1995] 2 S.C.R. 876, Palmer v. The Queen, [1980] 1 S.C.R. 759, Sengmueller v. Sengmueller (1994), 111 D.L.R. (4th) 19 (Ont. C.A.)

FACTS:

The deceased owned a farm, was never married, and had no children. The respondent was a long-time friend of the deceased and assisted him with the operation of his farm for two decades prior to his death. The deceased executed a will in 1992 which passed his estate on to his parents; however, as his parents had both passed away before the deceased, in the absence of a subsequent valid will, his estate would pass on an intestacy to his brother, the appellant, and the two daughters of his deceased sister. In 2009, the deceased gave the respondent a power of attorney over his property and personal care. In 2013, the deceased worked with his lawyer to draft a new will naming the respondent as the sole beneficiary of his estate, but did not execute this will before passing away. This draft will is dated August 15, 2013, and has the word DRAFT on every page. Two versions of the 2013 will were marked as exhibits at trial, Version 1 with only the deceased’s signature and Version 2, which includes the deceased’s signature and the signature of two witnesses. The central factual issue was whether Version 2 had been signed by the witnesses prior to the deceased’s death, or afterwards, when the respondent realized it needed witness signatures to be valid. The respondent’s evidence, accepted by the trial judge, was that she ran into one of the witnesses who testified that they witnessed the deceased sign the will on August 15, 2013, then searched through the house again before finding Version 2 of the will on top of a kitchen cupboard. The appellant’s position was that the respondent, with the cooperation of the two witnesses, created Version 2 after learning that Version 1 was invalid. This was supported by the fact that the original Version 1 was never produced at trial and that the respondent’s evidence at trial was inconsistent and lacked credibility. The appellant maintained that the reason Version 1 was never produced at trial is because it is the same document that became Version 2 when “witnessed” in the weeks following the deceased’s death. His central argument was that the trial judge misapprehended the expert evidence, which was that the deceased’s signatures on Version 1 and Version 2 were copies of one another, and this misapprehension tainted the rest of the trial judge’s findings. At trial, the original copies of both Version 1 and Version 2 were unavailable so the judge and expert had to rely on photocopies. Version 2 has since been found, and the respondent filed a motion to introduce it as fresh evidence.

ISSUES:

(1) Did the trial judge err in finding that the respondent had discharged her burden to prove the formal validity of the will, which she claimed to have found a number of weeks after his death in June 2015? (2) Can the respondent introduce Version 2 of the will as fresh evidence on this appeal?

HOLDING:

Appeal allowed.

REASONING:

(1) Yes. The trial judge erred in finding that the respondent had discharged her burden to prove the formal validity of the will due to a misapprehension of the content and significance of expert evidence. The trial judge made a number of palpable and overriding errors throughout the trial, with the main error being misapprehending the expert’s evidence. The trial judge was not alive to the essence of the respondent’s claim that Version 1 and Version 2 of the will were the same document, or that the witnesses had signed Version 1, making it Version 2, after the deceased’s death. The expert concluded that the signatures on the photocopies of Version 1 and Version 2 were copies of one another, and testified, as a handwriting expert, that no two signatures are exactly alike because of natural variations in writing. The trial judge did not appreciate the significance of the expert’s evidence that the signatures were copies and failed to infer that this meant the deceased could not have signed both copies. The trial judge specifically observed that it was difficult to understand how the expert evidence supported the appellant’s theory. The misapprehension of the expert evidence in this case was a significant error. Had the trial judge understood the implications of the expert evidence, she would likely have approached the rest of the evidence differently. For example, she may have given more weight to the fact that Version 1 was missing. Twice, the trial judge stated that the fact that Version 1 was missing was irrelevant to the validity of Version 2, but the significance and relevance stems from the possibility that Version 1 had become Version 2. If the respondent’s theory was correct, and the appellant had arranged to have “witnesses” sign the will after the deceased’s death, then it would make sense that there would be no Version 1. However, the trial judge stated that it was up to the respondent to produce the original Version 1 of the will and call evidence as to why the expert was working with photocopies. The trial judge further erred with this expectation, as the onus of proving the validity of a will lies on the propounder of the will, in this case the respondent. The very fact that the respondent could not produce the original Version 1 is what gave rise to the issue of the validity of Version 2. The respondent did not meet her onus of establishing the formal validity of the will. (2) No. The respondent did not meet the test for the admission of fresh evidence because the admission of the original Version 2 is not conclusive as to whether Version 2 of the will is valid or as to what happened to the original Version 1. Admitting Version 2 was not necessary to deal fairly with the issues on appeal and declining to admit it would not result in substantial injustice.


Pichelli v. Kegalj, 2021 ONCA 445

[Roberts, Zarnett and Sossin JJ.A.]

COUNSEL:

D. M. Cunningham, for the appellants N. Paris, for the respondent Keywords: Torts, Fraud, Deceit, Misrepresentation, Breach of Trust, Unjust Enrichment, Civil Procedure, Summary Judgment, Fresh Evidence, Rules of Civil Procedure, Rules 20.04(2.1), 20.04(2.2), 21, 25, 25.06(8), Hryniak v. Mauldin, 2014 SCC 7, Trotter Estate, 2014 ONCA 841, Royal Bank of Canada v 164397 Ontario Inc, 2021 ONCA 98, Sengmueller v. Sengmueller, 1994 111 D.L.R. (4th) 19 (Ont. C.A.)

FACTS:

The appellants invested money in a land development that never came to fruition. The appellants argued that the respondent, together with the defendants, carried out a fraudulent scheme for their own personal enrichment. The appellants claimed judgment against the respondent and other defendants jointly and severally for general and punitive damages for breach of contract, misrepresentation, deceit, fraud, conversion, detinue, breach of fiduciary duty, breach of trust, and unjust enrichment. The appellants’ action was case managed with an action brought by other investors who had also lost money in the land development. These plaintiffs advanced similar claims against the respondent and defendants. However, the respondent only pursued summary judgment in this action. In response, the appellants moved to adjourn the motion until the documentary and oral discoveries in both actions were completed due to the risk of adverse factual and legal consequences for the absent plaintiffs. The appellants argued the respondent sought an impermissible form of partial summary judgment. The motion judge dismissed this argument and granted summary judgment. The motion judge’s analysis turned on the appellants’ admissions that they had no knowledge of the respondent’s alleged role in the fraudulent scheme during the relevant period. The motion judge concluded that the appellants’ recourse was against the other defendants and there was no genuine issue requiring a trial. The appellants appealed the dismissal of their action and argued the motion judge erred in his application of the analytical framework set out in Hryniak v. Mauldin, 2014 SCC 7 (Hryniak), and in concluding that there were no genuine issues requiring a trial. Additionally, the appellants move to admit fresh evidence on appeal.

ISSUES:

(1) Can the appellant submit fresh evidence on appeal? (2) Did the motion judge err in his analytical approach to summary judgment? (3) Did the motion judge err in concluding that there were no genuine issues requiring a trial?

HOLDING:

Appeal allowed.

REASONING:

(1) Yes. The Court held that the appellants could submit fresh evidence on the appeal, as it was highly relevant to ascertaining the respondent’s role in the fraudulent scheme. The Court further held that the admission of fresh evidence was necessary to deal fairly with the issues on appeal and declining to admit the evidence could lead to a substantial injustice: Sengmueller v. Sengmueller, 1994 111 D.L.R. (4th) 19 (Ont. C.A.). (2) Yes. The motion judge erred in his analytical approach to summary judgment, and therefore was not afforded deference on appeal: Hryniak; Trotter Estate, 2014 ONCA 841. The motion judge did not fully follow the framework set out in Hryniak and subsequent case law, and failed to engage in a broad assessment of the entire record to determine whether summary judgment was appropriate. Instead, he focused on the adequacy of the pleadings and the appellant’s admissions that they had no contact with or knowledge of the respondent. The motion judge’s approach caused him to reject the appellants’ contention that a trial was required and conclude that there was no need to resort to the fact-finding powers available under rules 20.04(2.1) and (2.2) of the Rules of Civil Procedure. Additionally, the motion judge’s approach caused the nature of the appellants’ fraud allegations and the relevant evidentiary support to be misapprehended. The motion judge erred when finding that the appellant’s claim was limited to fraudulent misrepresentation, and that there was no evidence that the respondent was unjustly enriched or had received any funds the defendant’s received from the appellants. The Court ruled that the fact that the appellants did not frame their fraud allegations in perfectly pleaded causes of action should not have been the focus of the motion judge’s analysis. The Court held there was no suggestion the appellants failed to plead fraud with sufficient particularity as per Rule 25.06(8) of the Rules. The Court held that the motion judge was required to determine whether it was appropriate to grant summary judgment by engaging with the Hryniak framework and taking a comprehensive look at the entire record. The Court held that the motion judge relied too heavily on the fact that that the appellants did not know or have dealings with the respondent at the relevant time, causing him to ignore evidence that supported the respondent’s participation in the alleged fraudulent scheme and his unjust enrichment at the appellants’ expense. The motion judge was incorrect when he accepted that there was no factual basis to support any of the causes of action pleaded based only on the appellant’s admissions. The Court held that it was likely the appellants would not know who the respondent was at the relevant time due to the nature of a fraudulent scheme and that the appellants were not required to prove they knew who the respondent was or the role he assumed in the scheme to make out their claims. When the relevant evidence was brought before the motion judge, he failed to explain why he rejected it or why he preferred the respondent’s evidence when conflict arose. The motion judge was required to determine if he could resolve this conflict by recourse under Rules 22.04(2.1) and (2.2) of the Rules or whether they raised genuine issues of credibility that required a trial. (3) Yes. The motion judge erred when concluding that there were no genuine issues requiring a trial. The Court held that the trial judge did not seriously engage with the Hryniak analytical framework and the record and did not properly analyze the evidence: Royal Bank of Canada v 164397 Ontario Inc, 2021 ONCA 98. The Court held that after the correct application of the Hryniak framework, there are genuine issues requiring a trial concerning the respondent’s alleged role in the fraudulent scheme.


Johnson v. Rajanna, 2021 ONCA 453

[Rouleau, Hoy and van Rensburg JJ.A.]

COUNSEL:

D. Ambrosini, for the appellant M. Tessier, for the respondents Keywords: Torts, Negligence, Medmal, Dentists, Civil Procedure, Summary Judgment, Expert Evidence, Standard of Care, Adjournments, Fresh Evidence, Experts, Expert Report, Rules of Civil Procedure, Rule 53.03(2.1), R. v. Palmer, [1980] 1 S.C.R. 759

FACTS:

The appellant commenced an action against the respondents for dental malpractice arising out of the extraction of a molar in April 2013. In February 2016, the respondents gave the notice of their intention to seek a summary dismissal of the action because the appellant had failed to obtain an expert report. The appellant asked for an adjournment to provide time to retain an expert, this was granted on a peremptory basis, and a timetable was imposed that required the appellant to have the necessary information by September 2019. When the motion was heard in March of 2020, no expert report had been obtained. Instead, the appellant produced an unsigned, undated, two-page document from an unnamed retired dentist which stated that discrepancies suggesting negligence and malpractice were present. The motion judge concluded the appellant was unable to obtain an expert report to support her claim. Given the complexity of determining liability in such cases and the respondent’s favourable expert report, the summary dismissal was granted. After the hearing, the appellant produced the expert report, prepared by Dr. Kellen, who had produced the previous documents. The opinions expressed in the report suggested that the conduct of the respondent’s indicated negligence. The appellant appealed the motion judge’s summary dismissal.

ISSUES:

(1) Should the admission of fresh evidence, the expert report, be allowed?

HOLDING:

Appeal allowed.

REASONING:

(1) Yes The Court found that each of the four steps for the admissibility of fresh evidence in R. v. Palmer, [1980] 1 S.C.R. 759, had been met. First, the appellant had attempted to obtain an expert report. She spoke of her difficulty in finding someone to opine that a fellow dentist was negligent. She only succeeded in finding Dr. Kellen days before the scheduled summary judgment motion. Therefore, even with the appellant’s due diligence, the evidence was incapable of being adduced at trial. The second factor, that the evidence be relevant, was not in dispute. Third, despite the lack of a Form 53, the evidence of Dr. Kellen was believable. However, certain deficiencies in the report, such as “assumptions” made by the doctor, could prove fatal if not rectified before trial. Finally, the Court found that if the motion judge had had the benefit of Dr. Kellen’s affidavit, the judge would not have found in the respondents’ favour. The respondents had the onus of establishing there was no genuine issue requiring a trial. The affidavit would have shown that the appellant suffered real injury. The motion judge, with the benefit of the report, would have found it in the interest of justice to adjourn to allow the appellant to fix the deficiencies in the expert report.


Laurentian University of Sudbury (Re), 2021 ONCA 448

[Hoy, Pepall and Zarnett JJ.A.]

COUNSEL:

A. Hatnay, D. Yiokaris, and S. Edmonds, for the moving party, Thorneloe University D. Miller, S. McGrath and D. Harland, for the responding party, Laurentian University of Sudbury V. DaRe, for the responding party, Firm Capital Mortgage Fund Keywords: Bankruptcy and Insolvency, Restructuring, Notice of Disclaimer, Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-3, Laurentian University of Sudbury v. University of Sudbury, 2021 ONSC 3392, Laurentian University of Sudbury (Re), 2021 ONCA 199, 9354-9186 Québec inc. v. Callidus Capital Corp., 2020 SCC 10, Edgewater Casino Inc. (Re), 2009 BCCA 40, Nortel Networks Corp. (Re), 2016 ONCA 332

FACTS:

On February 1, 2021, Laurentian University of Sudbury (“Laurentian”) obtained protection under the Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36 (“CCAA”), to permit it to restructure to emerge as a sustainable university for the benefit of all stakeholders. Laurentian, with assistance of the Monitor, decided to downsize its programs and realign its arrangements with three Federated Universities, Thorneloe University (“Thorneloe”) being one of them. The relationship between Laurentian and the Federated Universities consisted of the Federated Universities offering courses to students through Laurentian and Laurentian distributing a portion of its revenue to the Federated Universities. The Federated Universities do not admit or register their own students, nor do they grant their own degrees, and all students apply to Laurentian. Laurentian was not successful in reaching the required readjustments with the Federated Universities by way of court-ordered mediation. Laurentian and the DIP Lender, Firm Capital Mortgage Fund Inc., entered into a DIP Loan Amendment Agreement, under the condition that the disclaimers would be issued on April 1, 2021, and become effective, binding and final on May 1, 2021. With approval of the Monitor, Laurentian sent notices of disclaimer of the Federation Agreements and Financial Distribution Notices to the Federated Universities. In its report, the Monitor stated that the notices of disclaimer would enhance the prospects of a viable compromise and that, without them, Laurentian was unlikely to be able to complete a viable plan. Thorneloe brought a motion pursuant to s. 32(2) of the CCAA challenging its disclaimer notice. The CCAA judge dismissed Thorneloe’s motion. Thorneloe sought leave of appeal on the ground that allowing the disclaimer will result in Thorneloe’s insolvency and provide only de minimis financial benefit to Laurentian. Additionally, Thorneloe submitted that the motive for the disclaimer is the elimination of competition, which is inconsistent with the duty to act in good faith.

ISSUES:

(1) Should leave to appeal be granted?

HOLDING:

Motion dismissed.

REASONING:

(1) No The Court found no error in the CCAA judge’s conclusion that upholding the notice of disclaimer is the “least undesirable choice” that would enhance the prospects of a viable restructuring. The Court recognized the serious financial implications of the disclaimer for Thorneloe, but was not persuaded that there was any basis for interfering with the CCAA judge’s factual findings or legal conclusions. The Court pointed to the high deference that is owed to discretionary decisions made by judges supervising CCAA proceedings and recognized that appellate intervention is justified only where the judge erred in principle or exercised its discretion unreasonably, see 9354-9186 Québec inc. v. Callidus Capital Corp., 2020 SCC 10. The court refused to grant leave based on four factors set out in Nortel Networks Corp. (Re), 2016 ONCA 332. First, the proposed appeal was not prima facie meritorious and Thorneloe’s grounds of appeal included factual assertations that ran contrary to the CCAA judge’s factual findings. Second, the Court was not convinced that the appeal was of significance to the practice of insolvency law, as the issues raised turned on the application of existing law to the particular facts of the case. Third, in the Court’s view, granting leave would unduly hinder the progress of the action and would be a distraction from the real-time restructuring efforts. Finally, the Court agreed that the proposed appeal was of significance to the action, but this factor alone was no found to be sufficient basis on which to grant leave.


Manastersky v. Royal Bank of Canada, 2021 ONCA 452

[Feldman, Brown and Miller JJ.A.]

COUNSEL:

J. Devereux and G. Mens, for the appellant N. Shapiro, for the respondent Keywords: Contracts, Employment, Wrongful Dismissal, Reasonable Notice, Damages, Supreme Court Act, R.S.C. 1985, c. S-26, s. 43(1.1), Manastersky v. Royal Bank of Canada, 2019 ONCA 609, Matthews v. Ocean Nutrition Canada Ltd., 2020 SCC 26, Paquette v. TeraGo Networks Inc., 2016 ONCA 618, Lin v. Ontario Teachers’ Pension Plan, 2016 ONCA 619, Taggart v. Canada Life Assurance Co. (2006), 50 C.C.P.B. 163 (Ont. C.A.)

FACTS:

The respondent brought a wrongful dismissal claim against the appellant. At trial, the appellant conceded that it had terminated the respondent’s employment without cause. During his employment, the respondent participated in a profit-sharing plan called the Mezzanine Carried Interest Plan (“MCIP”). At the date of termination, the MCIP had two funds. Each had a designated Investment Period. The respondent carried his interest in the funds from 2008-2014. Months after termination of the respondent, the appellant wound up the two funds in the MCIP and approved termination of future Investment Periods. The respondent was compensated for his interest. The trial judge awarded the respondent 1) $953,392.50 in respect of “the lost opportunity to earn entitlements under” the MCIP during the 18-month reasonable notice period, and 2) $190,789 in respect of the respondent’s share of investment proceeds under the MCIP for the period 2005 to 2013, as calculated using his foreign exchange methodology. The Court allowed the appellant’s appeal regarding the damages under the reasonable notice period and dismissed the appeal regarding the investment proceeds using the foreign exchange methodology: Manastersky v. Royal Bank of Canada, 2019 ONCA 609 (the “Original Decision”). Pursuant to s. 43(1.1) of the Supreme Court Act, the case was remanded to the Court with the direction to dispose of it in accordance with the Supreme Court’s recent decision in Matthews v. Ocean Nutrition Canada Ltd., 2020 SCC 26.

ISSUES:

(1) Should the Original Decision of thr Court be altered on remand in light of the Supreme Court’s decision in Matthews?

HOLDING:

Original Decision affirmed.

REASONING:

(1) No. Matthews stands for two key principles: 1) When employees sue for wrongful dismissal, they are claiming for damages as compensation for the income, benefits, and bonuses they would have received had the employer not breached the implied term to provide reasonable notice; and 2) an employment contract “remains alive” for the purposes of assessing the employee’s damages. The employee is entitled to damages for bonuses or incentives if they would have been entitled to the same as part of their compensation during the reasonable notice period and if the terms of the contract or bonus plan does not take away this common law right: Matthews, para. 55. In the Original Decision, the majority concluded that the respondent was entitled to benefits during the reasonable notice period with respect to the two funds because the terms of the MCIP created a link to specific Investment Periods. The terms further stated that the fact that the respondent has rights to money from the two funds in the relevant Investment Periods does not give him rights under any future Investment Period. Therefore, the MCIP terms unambiguously restrict the respondent’s common law right to compensation beyond what was provided with respect to his interest in the funds in the two Investment Periods. The respondent argued that he deserved his payout from the two funds as well as $953,392.50 in damages for the reasonable notice period, historically annualized to the previous payout on a pro rata basis. The Court disagreed. This recharacterized the common law right provided by the MCIP terms to some form of annual bonus. In fact, it is a “carried interest” plan that makes it clear that annual payments were not made. The MCIP’s formula for calculating a bonus remains relevant to the inquiry into what benefit the employee would have been entitled to as part of his or her compensation during the reasonable period of notice: Paquette v. TeraGo Networks Inc., 2016 ONCA 618, at para. 18. The Matthews decision did not change this.


Kerbs v. Cote, 2021 ONCA 450

[Tulloch, Pardu and Roberts JJ.A.]

COUNSEL:

D. Goodman, for the appellant A. Gibson and A. Reitboeck, for the respondent Keywords: Family law, Contracts, Interpretation, Cohabitation Agreements, Separation, Reconciliation, Civil Procedure, Summary Judgment, Determination of Question of Law, Family Law Act, RSO 1990, c. F3, ss 52 to54, Family Law Rules, Rule 16(12)(a), Montague Lush and Walter Hussey Griffith, Law of Husband and Wife within the Jurisdiction of the King’s Bench & Chancery Divisions, 3rd ed. (London: Stevens and Sons, Limited, 1910), Creston Moly Corp. v. Sattva Capital Corp., 2014 SCC 53, Ernikos v. Ernikos, 2017 ONCA 347, Sydor v. Sydor (2003), 178 O.A.C. 155 (C.A.), Bailey v. Bailey (1982), 37 O.R. (2d) 117 (C.A), Bebenek v. Bebenek (1979), 24 O.R. (2d) 385 (C.A.), Nicol v. Nicol (1885), 30 Ch. D. 143, Langdon v. Langdon, 2015 MBQB 153, Sandrelli v. Sandrelli, 2015 ONSC 7913, Hartshorne v. Hartshorne, 2004 SCC 22

FACTS:

The parties began an “off-and-on-again” relationship in 2006, with numerous separations. This continued in 2012-2013 when the parties separated on a few occasions. In December 2012 or January 2013, the parties decided to resume cohabitation and, during this period, entered into the cohabitation agreement (“the Agreement”) that was the subject of this appeal. The respondent moved out of the home shortly after. In 2014, the two reconciled and in June of 2014 married, moving back into the appellant’s home. The parties discussed adding the respondent to the title to the matrimonial home in 2016, but that was ultimately not pursued. The relationship broke down in 2019. The respondent brought a motion for summary judgment, specifically, for an Order declaring the Cohabitation Agreement invalid, non-binding, and of no force or effect. The motion judge was meant to decide the question of law of whether separation followed by reconciliation terminated the Agreement. Although the notice of motion was confined to a question of law, the motion judge went on to make findings about the subjective intentions of the parties. The motion judge found the Agreement to be of no force or effect for three reasons. First, that the common law principle holding that reconciliation terminated a separation agreement applied to cohabitation agreements. Second, the discussion about transferring title to the matrimonial home showed that the parties did not subjectively intend that the Agreement would continue to apply in the event of a separation and reconciliation. Finally, the motion judge held that the consideration for the $5,000 payment was the respondent’s relocation from the matrimonial home and that, since that triggering event had occurred and payment made, the terms of the Agreement were exhausted.

ISSUES:

(1) Did the motion judge err in concluding that a reconciliation terminates a cohabitation agreement? (2) Did the motion judge err in failing to interpret the whole of the plain language of the contract in the factual context existing when it was signed? (3) Did the motion judge err in concluding that a payment made pursuant to the agreement exhausted the terms of the rest of the agreement.

HOLDING:

Appeal allowed.

REASONING:

(1) Yes It is well-established that, at common law, a separation agreement becomes void upon reconciliation of the parties, subject to any clause in the separation agreement overriding the common law rule: Ernikos v. Ernikos, 2017 ONCA 347. However, the Court refused to extend this rule to cohabitation agreements. The Court found that where the raison d’être of a separation agreement is separation, and the parties then reconcile, the foundation for the separation agreement dissolves. There was no basis to extend this logic so as to void a cohabitation agreement following reconciliation of the parties. Under such circumstances, the reconciled parties have returned to the very state contemplated by the cohabitation agreement. The Court, citing Langdon v. Langdon, 2015 MBQB 153, held that reconciliation leading to renewed cohabitation is more reflective of an intention to return to a relationship where one’s rights were formerly delineated by the agreement. Therefore, the reconciliation did not terminate the Agreement. (2) Yes The Court found that the motion judge had made extricable errors of law in his interpretation of the Agreement. He approached the interpretive process with the idea that the Agreement had to gainsay application of the common law test. He did not analyse the intentions of the parties at the time they entered into the agreement nor the contractual language itself. He made a finding about their subjective intentions not feasible on the record before him. The Agreement envisaged cohabitation, marriage, divorce, separation, and death of a party. It provided that “the parties intend by this Agreement to outline their respective rights and obligations while cohabiting, before or during marriage, upon death and in the event of separation”. Further, the Agreement specifically contemplated that the one party could transfer property to the other. To this extent, the 2016 discussion of transfer of some part of title to the matrimonial home was entirely consistent with the cohabitation agreement. Reading the contract as a whole, the Court concluded that the Agreement was intended to apply despite a separation and subsequent reconciliation preceding the final separation. (3) Yes The motion judge relied on Sandrelli v. Sandrelli, 2015 ONSC 7913, in holding that “if the parties intend the agreement to continue after they reconcile the agreement needs to state that”. Sandrelli was a case about a cohabitation agreement that explicitly contained a clause providing for disposition of property upon the happening of certain “triggering events”, including separation. The respondent, relying on Sandrelli, argued that the payment by the appellant to the respondent of $5,000 was a similar triggering event which brought the agreement to an end. The Court disagreed and found that the broad language of the agreement evinced an objective intention to have the agreement apply in general to cohabitation, including that which follows a separation and reconciliation. One could reasonably conclude that the $5,000 payment was intended to assist the respondent with a move to her own accommodation. There was no presumption that reconciliation brings an end to cohabitation agreements.


Leslie v. Encanto Potash Trading Corporation, 2021 ONCA 432

[Doherty, Benotto and Thorburn JJ.A.]

COUNSEL:

S. Hutt and M. Desforges, for the appellants J. E. MacDonnell, for the respondent Keywords: Contracts, Breach of Contract, Summary Judgment, Evidence, Cross-appeal, Costs, Interlocutory Appeal, Courts of Justice Act, R.S.O. 1990, c.43, Section 6(2), Rules of Civil Procedure, Rule 39.03

FACTS:

The appellants, Ms. L and her company, Grip Fast Strategies Corp. (“Grip Fast”), provided consulting services to the respondent. The respondent stopped paying her invoices and the appellants alleged that the respondents reneged on a stock option promised to the appellants. The appellants sued the respondent, Encanto, its affiliated company, Encanto Potash Trading Corp. (“EPTC”) and its CEO, Mr. D. All of the defendants, including the respondents, moved for summary judgment. The motion judge allowed the motion brought by the respondents’ affiliate company and CEO and dismissed the action against them. The motion judge dismissed the motion brought by the respondents and ordered the claim against them to proceed to trial. The respondents moved successfully for security costs against the appellant, Grip Fast. The appellants appealed the order dismissing the action against Mr. D and the order for security for costs. Encanto cross appealed the refusal of the motion judge to grant summary judgment dismissing the claim against Encanto. All parties submitted that the appeals from interlocutory orders were so interrelated with the issues arising on appeal from the dismissal of the action against Mr. D that the Court of Appeal should exercise its jurisdiction under s. 6(2) of the Courts of Justice Act, R.S.O. 1990, c.43 and hear the interlocutory appeals.

ISSUES:

(1) Should the Court hear an appeal from the interlocutory orders granting security for costs and dismissing Encanto’s motion for summary judgment? (2) Did the motion judge err in dismissing the claim against Mr. D?

HOLDING:

Appeal from interlocutory orders quashed. Appeal dismissed.

REASONING:

(1) No. The order requiring Grip Fast to post security for costs was interlocutory, as was the order dismissing Encanto’s motion for summary judgment. Interlocutory orders are not appealable in the normal course to the Court of Appeal. The Court held that the dismissal of the appeal as it related to the action against Mr. D did not require the determination of any issues that were integral to the other appeals. Therefore, there was no basis to invoke the Court’s jurisdiction under s. 6(2) of the Courts of Justice Act to hear Grip Fast’s appeal or Encanto’s cross appeal. Therefore, the appeal by Grip Fast and the cross appeal by Encanto were quashed as interlocutory. (2) No. The order dismissing the action against Mr. D was a final order and the appellants did have a right of appeal from that order. The evidence before the motion judge indicated that Ms. L dealt with Mr. D in his capacity as CEO of Encanto and the evidence spoke of an agreement between the two parties with detailed corresponding documentation supporting this contractual relationship. Based on the evidence, the Court upheld the motion judge’s decision that there was no genuine issue of the identity of the contracting parties. The Court had an issue with the allegation that Mr. D had provided a personal guarantee in respect to any consulting fees owed to Ms. L. The Court held there were no details provided in the pleadings, Ms. L’s affidavit, or the evidence that would support this claim. The Court found that many of the appellant’s personal claims against Mr. D were unsupported by evidence. There was no evidence that Mr. D misrepresented his background to Ms. L, or if he did, that Ms. L could reasonably rely on any representation as to the enforceability of the agreement with Encanto. Furthermore, the Court held there was no basis to hold that anything done by him in respect of non-payment of the invoices was done in any capacity other than as CEO of Encanto. For these reasons, the Court dismissed the appeal from the dismissal of the claim against Mr. D.


Moncur v. Plante, 2021 ONCA 432

[Fairburn A.C.J.O., Harvison Young and Jamal JJ.A.]

COUNSEL:

M. H. Twyman, for the appellant M. Marrello, for the respondent Keywords: Family Law, Custody and Access, Civil Procedure, Orders, Enforcement, Civil Contempt, Carey v. Laiken, 2015 SCC 17, Greenberg v. Nowack, 2016 ONCA 949, Chong v. Donnelly, 2019 ONCA 799, Valoris pour enfants et adultes de Prescott-Russell c.K.R., 2021 ONCA 366, Ruffolo v. David, 2019 ONCA 385

FACTS:

The appellant appeals (1) the motion judge’s order finding her in contempt of court for four breaches of the final parenting order made on consent in November 2018 (“parenting order”); and (2) the order of the motion judge ordering the appellant to comply strictly with the parenting order and to pay the respondent $2,500 as sanctions for contempt and $10,000 in costs. The parties married in 2007, had a child together in 2010, and separated in 2015. Parenting issues were resolved through the parenting order in 2018, which governs the parties’ joint decision-making responsibilities and parenting time, parenting schedule, communication between the parties, residence, travel, documents and registrations. It also provides for resolving parenting disputes by negotiation, then mediation, and finally arbitration. In November 2019, the respondent sought an order that the appellant be found in contempt of court for breaching the parenting order ten times between December 2018 and July 2019. The respondent alleged that the appellant overheld the child twice, attended the child’s activities and school several times during the respondent’s parenting time, unilaterally changed the date of the child’s First Communion without advising the respondent, and failed to provide him with a copy of the child’s Social Insurance Number (“SIN”) card. The motion judge held the matter in abeyance until the parties completed arbitration in the best interests of the child and the parties’ relationship. However, the parties did not proceed to arbitration and appeared before the motion judge again. The respondent argued that by the motion judge delaying his ruling, the court was causing more conflict while the appellant argued that the contempt motion was being “weaponized” against her and used to avoid the arbitration. The motion judge found the appellant in contempt for four of the ten alleged breaches of the parenting order and ruled that the appellant violated the parenting order by: unilaterally modifying the child’s schedule twice, unilaterally changing the child’s First Communion date without effective notice or consultation with the respondent and failing to provide the respondent with a copy of the child’s SIN card as required. The motion judge stated the monetary sanctions were appropriate “given the extent of the contempt” and to impress upon the appellant her obligation to abide by the parenting order.

ISSUES:

(1) Did the motion judge err in ruling that the appellant intentionally breached the parenting order? (2) Did the motion judge err in failing to consider discretionary factors before making findings of contempt?

HOLDING:

Appeal allowed.

REASONING:

(1) No. The Court reviewed general principles that govern the use of the court’s power to find a party in contempt for breach of a court order. For a party to be found in contempt, three elements must be proved beyond a reasonable doubt: (1) the order alleged to have been breached must state clearly and unequivocally what should and should not be done; (2) the party alleged to have breached the order must have actual knowledge of it; and (3) the party who allegedly breached must have intentionally done the act that the order prohibits or intentionally failed to do the act that the order compels: Carey v. Laiken, 2015 SCC 17; Greenberg v. Nowack, 2016 ONCA 949. Furthermore, the Court outlined that the exercise of contempt power is discretionary, and it should be used as a last resort. Before making a contempt finding, a judge should consider other options: Carey; Chong v. Donnelly, 2019 ONCA 799 (“Chong”); Valoris pour enfants et adultes de Prescott-Russell c.K.R., 2021 ONCA 366 (“Valoris”); Ruffolo v. David, 2019 ONCA 385 (“Ruffolo”). Last, the Court stated that when the issue raised on the contempt motion concerns access to children, the paramount consideration is the best interests of the children: Ruffolo, Chong. The Court upheld the motion judge’s finding that the appellant intentionally breached the parenting order in four respects. The Court rejected the appellant’s arguments to the first and second breaches regarding the child being overheld. The appellant argued that she was justified in overholding the child in June 2019, as the respondent had not informed her which camp the child would attend in June. Further, the appellant argued that she was justified in overholding the child in July 2019, when she booked the camp after having received no response from the respondent. The Court upheld the motion judge’s conclusion that the respondent was not required to comply with the appellant’s pre-conditions for the exchange to take place and that overholding in June was unnecessary, unjustified and in deliberate defiance of the parenting order. Furthermore, the Court held that in July, the respondent did object and the appellant was in violation and deliberate defiance of the parenting order. Third, the Court held that the motion judge was correct in finding that the appellant breached the parenting order by unilaterally changing the date of the child’s First Communion. The Court did not accept the appellant’s argument that the breach was unintentional because she moved the date to avoid traffic and had attempted to contact the respondent but had the wrong email address. Last, the Court found that the motion judge was correct in finding a breach of the parenting order when the appellant refused to provide a copy of the child’s SIN card to the respondent. The Court held that the parenting order specifically stated that “all of the child’s government issued identification documents” must be shared with the respondent and did not accept the appellant’s argument that the card was not government issued and that the respondent already knew the number; thus, she was not required to provide him with a copy. The Court upheld the motion judge’s reasoning that the copy of SIN card was required by the parenting order to be provided in a timely exchange and this obligation was not met, resulting in an intentional breach. (2) Yes. The Court held that the motion judge considered the best interests of the child but failed to consider whether a declaration of contempt was a remedy of last resort or whether there were alternative enforcement options. The Court held that the motion judge did not consider any alternatives and proceeded directly from conclusions that the appellant intentionally breached the parenting order to declarations of contempt. The motion judge was required to consider not only when he should issue his decision on the contempt motion, but also whether he should exercise his discretion to resort to a less severe enforcement option. The Court concluded that this resulted in an error of law and it was especially important for courts to consider alternatives in high-conflict family disputes such as this one: Chong, at para 12; Valoris, at para 41. The Court set aside the findings of contempt of court and the related sanctions and replaced them with declarations that the appellant intentionally breached the parenting order in four respects.


Moore v. 7595611 Canada Corp., 2021 ONCA 432

[Fairburn A.C.J.O., Harvison Young and Jamal JJ.A.]

COUNSEL:

K. L., acting in person for the appellants C.I.R. Morrison, M. Smitiuch and L. Hamer, for the respondents Keywords: Torts, Negligence, Occupier’s Liability, Standard of Care, Damages, Mental Distress, Loss of Care, Guidance, and Companionship, Cost of Future Care, Civil Procedure, Jury Selection, Fresh Evidence, Juries Act, R.S.O. 1990, c. J.3, s. 44(1), Fire Protection and Prevention Act, 1997, S.O. 1997, c. 4, s. 76, Fire Code, O. Reg. 213/07, Fatal Accidents Act, R.S.A. 2000, c. F-8, s. 8(2), To v. Toronto Board of Education (2001), 204 D.L.R. (4th) 704 (Ont. C.A.), Young v. Bella, 2006 SCC 3, Hill v. Church of Scientology of Toronto, [1995] 2 S.C.R. 1130, Fiddler v. Chiavetti, 2010 ONCA 210, Vokes Estate v. Palmer, 2012 ONCA 510, Rodrigues v. Purtill, 2019 ONCA 740, Gervais v. Richard (1984), 48 O.R. (2d) 191 (H.C.), Mason v. Peters (1982), 139 D.L.R. (3d) 104 (Ont. C.A.), Rodrigues v. Purtill, 2019 ONCA 740, Palmer v. The Queen, [1980] 1 S.C.R. 759

FACTS:

The Respondents’ daughter, A, died from severe injuries suffered in a fire. The fire broke out while the Respondent’s daughter was asleep in the bedroom of her basement apartment located in a rooming house. That apartment was owned by the landlord Appellants, KL and his numbered corporation. The secondary exit of the apartment and the apartment’s windows were blocked off, leaving the apartment’s main entrance, which was blocked by fire, the only exit. The Respondents’ daughter suffered severe burns and after several days the Respondents were forced to remove her from life support. The Respondents commenced an action against the Appellants in negligence. The jury found the Appellants fell below the standard of care of a reasonable landlord and found them responsible for the death. The jury awarded the following heads of damage: 1. Loss of care, guidance, and companionship: $250,000 to each Respondent; 2. Mental distress: $250,000 to each Respondent; 3. Future costs of care for the Respondent father: $174,800; and 4. Future costs of care for the Respondent mother: $151,200.

ISSUES:

(1) Was the jury improperly selected due to an irregularity that occurred before trial? (2) Does s. 76 of the Fire Protection and Prevention Act preclude the Respondents’ action in this case? (3) Was the jury’s verdict unreasonable? (4) Were the various damage awards too high? (5) Should the Appellants be allowed to admit fresh evidence?

HOLDING:

Appeal dismissed.

REASONING:

(1) No The Appellant argued that there was an irregularity in jury selection. There were 41 prospective jurors who had been inadvertently released from the jury pool. Technically, those 41 prospective jurors should have been in the jury pool used to select the jury in this case. The trial judge learned of this and asked the parties for their input. The Respondents made no objection. The Appellants objected, noting they would want a new jury selection or to proceed with a judge alone. The Court stated that section 44(1) of the Juries Act makes it clear that any omission to observe a provision of the Juries Act respecting the selection of jurors is “not a ground for impeaching or quashing a verdict or judgment in any action.” At most, the release was a minor irregularity that resulted in no prejudice to the Appellants. Therefore, no effect was given to this ground of appeal. (2) No The Appellants argued that s. 76 of the Fire Protection and Prevention Act, 1997, S.O. 1997, c. 4, precluded the Respondents’ action in this case because it was not proven that the fire started from anything other than an accidental source. Section 76 reads as follows: No action shall be brought against any person in whose house or building or on whose land any fire accidentally begins, nor shall any recompense be made by that person for any damage suffered thereby; but no agreement between a landlord and tenant is defeated or made void by this Act. The Court held that at minimum the genesis of a fire does not immunize a landlord from a failure to take reasonable precautions to protect the occupants of a building from a fire, even if that fire breaks out accidentally. The jury found that the Appellants were responsible for the death for the following reasons: the failure to ensure that a safety plan for the building was prepared, approved, and implemented; the failure to maintain smoke alarms in operating condition; and the failure to provide at least two exits from each “floor area” of the rooming house. Therefore, the jury’s finding of negligence had nothing to do with the source of the fire. The ground of appeal was, therefore, given no effect. (3) No The jury’s verdict listed three bases upon which they found the Appellants responsible for A’s death: a lack of a properly implemented safety plan; inoperative smoke alarms; and insufficient exits. The Court held that there was a clear factual foundation for those findings. There was therefore no basis to find the jury’s verdict unreasonable. (4) No Regarding the mental distress damages award, the Appellants’ argument suggested that the award was directed at the Respondents’ grief, and should not have been awarded. The Court disagreed, as there was clear psychological damage inflicted due to the death of the Respondents’ daughter. This psychological damage was supported by expert testimony. The Court found no basis to interfere with this head of damage. The Appellants also objected to the future cost of care award, stating that the Respondents had not shown they would require a damage award for such care. The Court again disagreed. Expert evidence had suggested a much higher amount for future care was warranted, and the jury had awarded significantly less than those amounts. The awards were therefore based upon the evidence adduced at trial. Further, the Appellants did not object to the jury charge. Therefore, the Court found no basis to interfere with the awards. The Appellants also challenged the jury’s award for loss of care, guidance, and companionship. This argument was based on the ruling in To v. Toronto Board of Education (2001), where the court held that the upper limit for such awards was $100,000. The Court denied this ground of appeal. It found that caselaw held that an appellate court should only interfere with a jury’s assessment where it “shocks the conscience of the court”: Young v. Bella, 2006 SCC 3. Further, since there is no legislative cap on such awards, “each case must be given separate consideration” by the courts to determine the appropriate quantum of damages: To v. Toronto Board of Education (2001), 204 D.L.R. (4th) 704 (Ont. C.A.). The Court held that while there was no question that the jury award for loss of care, guidance, and companionship in this case was high, in light of the factual backdrop of the case, it did not constitute an amount that “shocks the conscience of the court”: Young v. Bella, 2006 SCC 3. (5) No Applying the criteria from Palmer v. The Queen, [1980] 1 S.C.R. 759, the Court found that the subject evidence was not sufficiently cogent to have in any way impacted the result at trial.


Tribute (Springwater) Limited v. Atif, 2021 ONCA 432

[Strathy C.J.O., Feldman and van Rensburg JJ.A.]

COUNSEL:

A. Flesias, for the appellants/respondents by way of cross-appeal C. Steven and K. Chaytor, for the respondent/appellant by way of cross-appeal Keywords: : Contracts, Real Property, Agreements of Purchase and Sale of Land, Damages, Mitigation, Prejudgment Interest, Postjudgment Interest, Rules of Civil Procedure, Rule 25.06(9)(b), Courts of Justice Act, RSO 1990, c C43, ss 127, 128, 129, 130(1) and 130(2), Southcott Estates Inc. v. Toronto Catholic District School Board, 2012 SCC 51, 100, Main Street East Ltd. v. W.B. Sullivan Construction Ltd. (1978), 20 O.R. (2d) 401 (C.A.), 642947 Ontario Ltd. v. Fleischer (2001), 56 O.R. (3d) 417 (C.A.), Tribute (Springwater) Limited v. Sumera Anas, 2020 ONSC 5277, McKnight v. Ontario (Transportation), 2018 ONSC 52, Gyimah v. Bank of Nova Scotia, 2013 ONCA 252, Bank of America Canada v. Mutual Trust Co., 2002 SCC 43, Tilden Rent-A-Car Co. v. Clendenning (1978), 18 O.R. (2d) 601 (C.A.), MacQuarie Equipment Finance Ltd. v. 2326695 Ontario Ltd. (Durham Drug Store), 2020 ONCA 139, Forest Hill Homes v. Ou, 2019 ONSC 4332

FACTS:

This was an appeal from a summary judgment awarding the respondent damages, interest, and costs for the appellants’ failure to close a residential real estate transaction. The respondent cross-appealed the motion judge’s order respecting prejudgment and postjudgment interest. On March 25, 2017, the appellants signed an agreement of purchase and sale (“APS”) for a new home to be built by the respondent. The purchase price was $1,115,490 with an initial deposit of $90,000 and a further deposit of $50,312.50. The appellants failed to close on the extended closing date of December 17, 2018, and the APS was terminated by the respondents in January 2019. In February 2019, the respondents commenced an action claiming damages for breach of contract. The appellants denied the respondent’s allegations and pled that they had complied with their obligations under the APS, that the property was not built to specifications, and that the respondent’s damages were excessive and exaggerated. On November 2, 2019, the respondent sold the property for $985,000 then moved for summary judgment. The motion judge granted summary judgment for $383,636.47, with prejudgment interest fixed at $90,717.36, costs of $20,000, and a postjudgment interest rate of 4.45%. On appeal, the appellants no longer disputed their liability for breaching the APS but rather appealed the amount of the judgment and claimed that the respondent did not take reasonable steps to mitigate its damages. They contended that the motion judge did not address mitigation and erred by awarding damages in excess of the amount sought in the statement of claim.

ISSUES:

(1) Did the respondents fail to mitigate their damages?

(2) Did the motion judge err in granting judgment for an amount that exceeded the respondent’s claim for damages in the statement of claim?

(3) Did the motion judge err in departing from the contractual interest rate of prime plus 5% when fixing an interest rate for pre and postjudgment interest?

HOLDING:

Appeal and cross-appeal dismissed.

REASONING:

(1) No. The respondents did not fail to mitigate their damages. If they had placed the property on the market nine months earlier, as the appellants argued they should have, it may have sold for a lower selling price, as the average market value of similar homes increased by $100,000 during those nine months. The respondent’s vice president of marketing and sales deposed that they marketed the property internally before placing it on the market to avoid the additional expense of paying a commission on the sale and to avoid a reduction in the value of other homes they were selling in the same community. Where it is alleged that the plaintiff failed to mitigate damages, the onus is on the defendant to prove that the plaintiff failed to mitigate its damages. The appellants did not challenge the respondent’s evidence on cross-examination or provide their own evidence to demonstrate a lack of mitigation. Damages in respect of a failed real estate transaction are generally the difference between the agreed sale price under the APS and the market value of the property on the closing date. In this case, the property was appraised on the closing date at $890,000 and was sold 12 months later at $985,000. The appellant argued that the respondent’s delay in listing the property for sale was a failure to mitigate; however, in this circumstance, it resulted in an increased selling price and reduced the damages payable by the appellant. (2) No. In the respondent’s statement of claim, it claimed “damages in the amount of $200,000 for breach of contract, or such further or other amount as may be determined and particularized at or before trial.” Rule 25.06(9)(b) provided that the amounts and particulars of special damages only needed to be pleaded to the extent they were known on the date of the pleading with notice of any further damages being delivered as they become known, not less than ten days before trial. The statement of claim was issued before the property had been resold and the appellants were always apprised of the particulars of the respondent’s claim, in compliance with rule 25.06. (3) No. Section 130 of the Courts of Justice Act, which speaks to the court’s discretion to depart from prejudgment and postjudgment interest under ss. 128 and 129, is not exhaustive of the court’s discretion. Courts have discretion to depart from contractual interest rates where there are special circumstances. Here, the special circumstances that justified a departure from the contractual interest rate were that the respondent did not put the property on the market for nine months after terminating the APS. During these nine months, interest accrued on the total purchase price rather than the difference in the purchase price and selling price, and the respondent incurred carrying costs. These circumstances justified the motion judge’s decision to award prejudgment interest at the prime plus 2% rate and postjudgment interest at 4.45% rather than the contractual interest rate of prime plus 5% interest.