Court Of Appeal Summaries (May 25 – 29, 2020) - Professional Negligence

Good afternoon.

It was a busier week at the Court of Appeal this past week, with the Court releasing eight substantive civil decisions, one short civil decision and ten criminal decisions.

Topics covered this week included the right of refusal in the sale of a matrimonial home, the valuation of federally regulated pensions for equalization purposes, the re-opening of an appeal based on fresh evidence arising from text messages, the professional negligence of solicitors, and striking pleadings under Rule 2.1 as frivolous, vexatious or abuse of process.

Perhaps the most noteworthy decision of the week, at least for courts of first instance, was Welton v. United Lands Corporation Limited. In that case, the Court heard an appeal over a trial judge's award of compensation for unpaid sales commissions and other compensation. In its decision, the Court expressed concern as to the growing trend of lengthy reasons, like the decision in this case. The Court asked trial judges to focus their analysis on the live issues that will decide the case before setting out the facts to avoid, what the Court referred to as, a "factual data dump". While appreciating that technology has allowed for more detailed note-taking on the part of judges, the Court expressed the view that the role of the trial judge is to "decant and simplify", not to be the court reporter. Digesting unduly lengthy reasons consumes far too much time because every word must be read by the parties, by their counsel at great expense, and by appellate courts.

Bowman v. Martineau illustrates the danger for liability on the part of real estate agents who act on both sides of a transaction (which is very common). The agents were found liable to the purchasers for not ensuring that the vendors had disclosed water damage and mould issues. At trial, they were found liable for the cost of repairs. The Court held that the proper measure of damages against the agents was the diminution in value, not the cost of repairs. The agent's negligence caused the purchasers to enter into a bad bargain. It did not cause the water damage and mould.

Finally, in Falcon Lumber Limited v. 2480375 Ontario Inc. (GN Moulders and Doors), the Court upheld the motion judge's decision to strike out a statement of defence as a result of repeated failures to comply with a judicial order to produce relevant documents, as well as an order for costs against the defendant's law firm personally. Given the potential for a conflict of interest, the Court expressed concern that counsel against whom the costs order had been made who was appealing that costs order was also acting for the client on the client's appeal.

Civil Decisions

Falcon Lumber Limited v. 2480375 Ontario Inc. (GN Mouldings and Doors), 2020 ONCA 310

Keywords: Civil Procedure, Orders, Enforcement, Striking Pleadings, Costs Against Lawyers, Professional Conduct of Lawyers, Representation, Avoidance of Conflicts of Interest, Contracts, Debtor-Creditor, Fraudulent Conveyances, Rules of Civil Procedure, Rules 1.04, 30.02(1), 30.02(2), 30.06, 30.08, 57.07(2), 61.03(17)(b), Courts of Justice Act, R.S.O. 1990, c. C.43, s 133(b), Rules of Professional Conduct, Rules 3.4-2, 3.4-3, Hryniak v. Mauldin, 2014 SCC 7, Starland Contracting Inc. v. 1581518 Ontario Ltd. (2009), 252 OAC 19 (Div. Ct.)

Khan v. Law Society of Ontario, 2020 ONCA 320

Keywords: Torts, Solicitor Negligence, Civil Procedure, Striking Pleadings, Frivolous, Vexatious and Abuse of Process, Rules of Civil Procedure, Rule 2.1, Scaduto v. The Law Society of Upper Canada, 2015 ONCA 733, Simpson v. The Chartered Professional Accountants of Ontario, 2016 ONCA 806, Penner v. Niagara (Regional Police Services Board), [2013] 2 S.C.R. 125

Barry v. Barry, 2020 ONCA 321

Keywords: Family Law, Equalization of Net Family Property, Matrimonial Home, Sale, Right of First Refusal, Civil Procedure, Appeals, Jurisdiction, Final or Interlocutory, Courts of Justice Act, R.S.O. 1990, c. C.43 s. 6(1)(b), Martin v. Martin, [1992] 8 O.R. (3d) 41 (C.A.)

Graff v. Network North Reporting and Mediation, 2020 ONCA 319

Keywords: Civil Procedure, Summary Judgment, Appeals, Perfecting Appeals, Extension of Time, Sickinger v. Sickinger, 2017 ONCA 760

Welton v. United Lands Corporation Limited, 2020 ONCA 322

Keywords: Contracts, Breach, Employment, Wages, Commissions, Restitution, Unjust Enrichment, Quantum Meruit, Civil Procedure, Reasons for Decision, Costs, Offers to Settle, Rules of Civil Procedure, Rules 49.19(2), 49.13, Moore v. Sweet, 2018 SCC 52, König v. Hobza, 2015 ONCA 885, Lawson v. Viersen, 2012 ONCA 25

Bowman v. Martineau, 2020 ONCA 330

Keywords: Contracts, Real Property, Agreement of Purchase and Sale of Land, Representations and Warranties, Misrepresentation, Non-Disclosure, Torts, Professional Negligence, Real Estate Agents, Damages, Diminution in Value, Cost of Repair, Mitigation, Nan v. Black Pine Manufacturing Ltd. (1991), 80 D.L.R. (4th) 153 (B.C.C.A.), Clements v. Clements, 2012 SCC 32, [2012] 2 S.C.R. 181, Deloitte & Touche v. Livent Inc., 2017 SCC 63, James Street Hardware and Furniture Co. v. Spizziri, 1987 CanLII 4172 (Ont. C.A.), C.R. Taylor (Wholesale) Ltd. and others v. Hepworths Ltd., [1977] 2 All E.R. 784 (Q.B.), Dominion Mosaics and Tile Co. Ltd. and another v. Trafalgar Trucking Co. Ltd. and another, [1990] 2 All E.R. 246 (C.A.), Harbutt's Plasticine Ltd. v. Wayne Tank and Pump Co. Ltd., [1970] 1 All E.R. 225 (C.A.), Kienzle v. Stringer (1981), 35 O.R. (2d) 85, leave to appeal refused, [1982] S.C.C.A. No. 252, Jarbeau v. McLean, 2017 ONCA 115, Tabata v. McWilliams et al. (1982), 40 O.R. (2d) 158 (C.A.), Messineo et al. v. Beale (1978), 20 O.R. (2d) 49 (C.A.), Toronto Industrial Leaseholds Ltd. v. Posesorski (1994), 119 D.L.R. (4th) 193 (Ont. C.A.), Krawchuk v. Scherbak, 2011 ONCA 352

Geliedan v. Rawdah, 2020 ONCA 339

Keywords: Family Law, Custody and Access, Relocation, Civil Procedure, Appeals, Reconsideration, Fresh Evidence, Consent Custody Order, Children's Law Reform Act, R.S.O. 1990, c. C.12, s. 40, First Elgin Mills Developments Inc. v. Romandale Farms Limited, 2015 ONCA 54, Doman Forest Products Ltd. v. GMAC Commercial Credit Corp. - Canada, 2005 BCCA 111

Van Delst v. Hronowsky, 2020 ONCA 329

Keywords: Family Law, Spousal Support, Child Support, Custody, Equalization of Net Family Property, Pension Benefits, Valuation, Fresh Evidence, Family Law Act, R.S.O. 1990, c. F.3, s. 10.1(2), Family Law Rules, Rules 17(4)(d.1), 20.2(8)2, Pension Benefits Act, R.S.O. 1990, c. P.8, ss. 1(1), 10(1)4, 35(1), 35(3), 67.2, Public Service Superannuation Act, R.S.C. 1985, c. P-36, ss. 12(.01), 12(1), 12.1(2), 13, 13(1), 13.001, Di Francesco v. Di Francesco, 2011 ONSC 3844, Palmer v. The Queen, [1980] 1 S.C.R. 759, R. v. Penunsi, 2019 SCC 39, Kelly v. Kelly, 2017 ONSC 7609, Humphreys v. Humphreys (1987), 1987 CarswellOnt 309, Martin v. Martin, 2018 ONSC 6804, Berta v. Berta, 2015 ONCA 918

Short Civil Decisions

Windsor-Essex Children's Aid Society v. J.C., 2020 ONCA 328

Keywords: Publication Ban, Family Law, Child Protection

Criminal Decisions

R. v. S., 2020 ONCA 311

Keywords: Criminal Law, Impaired Driving, Dangerous Driving, Failing to Stop for Police, Driving While Disqualified, Gladue Reports, Sentencing, Victim Surcharge, Criminal Code, s. 718.2(e), R. v. Gladue, [1999] 1 S.C.R. 68, R. v. Ipeelee, 2012 SCC 13

R. v. G.J.S., 2020 ONCA 317

Keywords: Publication Ban, Criminal Law, Sexual Assault, Sexual Interference, Sexual Exploitation, Sexual Touching, Evidence, Admissibility, Hearsay, Third Party Records, Credibility, Child Witnesses, Recent Fabrication, Reliability, Corroboration, Prior Consistent Statements, Sufficiency of Reasons, Criminal Code, ss. 151(a), 153(1)(a), 271, 278, 696(1)(a)(i), R. v. Khan, [1990] 2 S.C.R. 531, R. v. W.(R.), [1992] 2 S.C.R. 122, Kienapple v. The Queen, [1975] 1 S.C.R. 729, R. v. Howe (2005), 192 C.C.C. (3d) 480 (Ont. C.A.), R. v. W.H., 2013 SCC 22, R. v. Burke, [1996] 1 S.C.R. 474, R. v. R.P., 2012 SCC 22, R. v. Tillekaratna (1998), 124 C.C.C. (3d) 549 (Ont. C.A.), R. v. Pittiman, 2006 SCC 9, R. v. R.E.M., 2008 SCC 51, R. v. Morrissey (1995), 22 O.R. (3d) 514 (C.A.), R. v. Stirling, 2008 SCC 10, R. v. Dinardo, 2008 SCC 24, R. v. Khan, 2017 ONCA 114, R. v. D.C., 2019 ONCA 442, R. v. S.K., 2019 ONCA 776, R. v. D.K., 2020 ONCA 79, R. v. G.C., [2006] O.J. No. 2245 (C.A.), R. v. Ellard, 2009 SCC 27

R. v. L., 2020 ONCA 324

Keywords: Criminal Law, Aggravated Assault, Use of Imitation Firearm, Breach of Recognizance, Drug Possession, Robbery, Assault, Uttering Death Threats, Evidence, Admissibility, Gladue Reports, Bail, Sentencing, Pre-Sentence Credit, COVID-19, Criminal Code, ss. 85(2)(a), 145(3), 268, Controlled Drugs and Substances Act, S.C. 2006, c. 19, s. 4(1), R. v. Downes (2006), 79 O.R. (3d) 321 (C.A.), R. v. Jacko, 2010 ONCA 452, R. v. Gladue, [1999] 1 S.C.R. 688, R. v. Ipeelee, 2012 SCC 13, R. v. Lacasse, 2015 SCC 64, R. v. Morgan, 2020 ONCA 279, R. v. Lacasse, 2015 SCC 64, R. v. Morgan, 2020 ONCA 279

R. v. M., 2020 ONCA 313

Keywords: Criminal Law, Drug Offences, Possession for the Purpose of Trafficking, Evidence, Admissibility, Search and Seizure, Search Warrants, Confidential Informants, Reasonable Expectation of Privacy, Electronic Devices, Cell Phones, Sentencing, Criminal Code, ss. 4(3)(a)(ii), 4(3)(b), 686(1)(a)(i), Canadian Charter of Rights and Freedoms, ss. 8, 24(2), Controlled Drug and Substances Act, S.C. 1996, c. 19, s. 11(1), R. v. Downes (2006), 79 O.R. (3d) 321 (C.A.), R. v. Vu, 2013 SCC 60, R. v. Sadikov, 2014 ONCA 72, Hunter v. Southam Inc., [1984] 2 S.C.R. 145, R. v. Jacobson (2006), 207 C.C.C. (3d) 270 (Ont. C.A.), R. v. Wilson, 2011 BCCA 252, 272 C.C.C. (3d) 269, R. v. Morelli, 2010 SCC 8, R. v. Araujo, 2000 SCC 65, R. v. Nero, 2016 ONCA 160, CanadianOxy Chemicals Ltd. v. Canada (Attorney General), [1999] 1 S.C.R. 743, R. v. Jones, 2011 ONCA 632, R. v. Lights, 2020 ONCA 128, R. v. R.P., 2012 SCC 22. R. v. Villaroman, 2016 SCC 33

R. v. B., 2020 ONCA 318

Keywords: Criminal Law, Impaired Driving Causing Bodily Harm, Sentencing, R. v. Grant, 2016 ONCA 639

R. v. D., 2020 ONCA 326

Keywords: Criminal Law, Drug Offences, Unauthorized Use of Credit Card Data, Sentencing, Immigration Law, Deportation Orders, Fresh Evidence, Credibility, Criminal Code, ss. 342(3), 606(1.1), 683(1), Controlled Drugs and Substances Act, S.C. 1996, c. 19, ss. 4-5, R. v. Sangs, 2017 ONCA 683, R. v. T. (R.) (1992), 10 O.R. (3d) 514 (C.A.), R. v. Wong, R. v. Girn, 2019 ONCA 2022018 SCC 25, R. v. Shiwprashad, 2015 ONCA 577, leave to appeal refused, [2017] S.C.C.A. No. 40

R. v. P., 2020 ONCA 323

Keywords: Criminal Law, Break and Enter, Theft, Possession of Stolen Property, Evidence, Inferences, Credibility, Sentencing, Criminal Code, s. 686(1)(a)(i), R. v. Lights, 2020 ONCA 128, R. v. Pham (2005), 203 C.C.C. (3d) 326 (Ont. C.A.), aff'd, [2006] 1 S.C.R. 940, R. v. Terrence, [1983] 1 S.C.R. 357

R. v. R.R., 2020 ONCA 327

Keywords: Publication Ban, Criminal Law, Sexual Assault, Evidence, Admissibility, Similar Fact Evidence, Character Evidence, Credibility, Sentencing, Bail Pending Appeal

R. v. S., 2020 ONCA 332

Keywords: Criminal Law, Aggravated Assault, Assault Causing Bodily Harm, Pointing a Firearm, Careless Use of a Firearm, Possession of a Loaded Prohibited Firearm, Failure to Comply with a Recognizance, Unreasonable Search and Seizure, Sentencing, Pre-Sentence Credit, Bail Pending Appeal, COVID-19, Criminal Code, s. 679(3)(c), Canadian Charter of Rights and Freedoms, ss. 8 and 24(2), R. v. Oland, 2017 SCC 17, R. v. Morales, [1992] 3 S.C.R. 711, R. v. Stojanovski, 2020 ONCA 285, R. v. Reeves, 2018 SCC 56, R. v. Kazman, 2020 ONCA 251, R. v. Omitiran, 2020 ONCA 261, R. v. Jesso, 2020 ONCA 280

United States v. A., 2020 ONCA 331

Keywords: Criminal Law, Extradition, Fraud, Extradition Act, 1999, c. 18, s. 55, 32(1)(a), 3(3), U.S.A. v. Viscomi, 2015 ONCA 484, R. v. M. (M.), 2015 SCC 62, U.S.A. v. Yang (2001), 56 O.R. (3d) 52

CIVIL DECISIONS

Falcon Lumber Limited v. 2480375 Ontario Inc. (GN Mouldings and Doors), 2020 ONCA 310

[Gillese, Brown and Huscroft JJ.A.]

Counsel:

Micheal Simaan and Rahul Gandotra, for the appellant
Ritchie J Linton, for the respondent

facts:

On March 31, 2016, Falcon Lumber Limited ("Falcon") commenced an action against 2480375 Ontario Inc. ("GN Trim") for the payment of $131,748.17 for delivered lumber and building materials. In March 2017, the owner of GN Trim, PL, incorporated 2562825 Ontario Inc. ("256"). In April 2017, PL caused GN Trim to grant him a security interest over its assets.

In November 2017, PL took the position that GN Trim had defaulted on the general security agreement and appointed a private receiver over GN Trim's assets. Two days after its appointment, the receiver sold GN Trim's assets to PL's new company, 256, by way of a private sale for $147,000. 256 operated its business from the Bolton, Ontario address from which GN Trim had operated (the "Premises").

In March 2018, 2625068 Ontario Inc. ("262") was incorporated with its registered head office listed as the Premises. In late April 2018, 262 closed the purchase of GN Trim's assets from 256 for $580,000. The assets acquired by 262 were the same assets of GN Trim that 256 had bought from the receiver.

Falcon pleads that the 2017 and 2018 transactions involving GN Trim, 256, and 262 (the "PL Defendants") were intended to defeat its claim as a creditor for the goods it had sold and delivered to GN Trim and resulted in PL receiving a personal financial benefit. PL and 262 deny the allegations.

In July 2019, Falcon brought a motion to strike out the statement of defence of the PL Defendants for breach of documentary disclosure and production obligations after a two-year history of non-compliance with court orders by the PL Defendants. The motion judge struck out the statement of defence of the PL Defendants, without leave to amend, noted them in default, and permitted Falcon to proceed to obtain default judgment against them. The motion judge also awarded Falcon $6,246.54 in costs against the PL Defendants' counsel, the KSD Firm.

PL appealed the striking out of his statement of defence (his companies GN Trim and 256 did not join the appeal) and the KSD Firm appealed the costs award.

issues:

(1) Did the motion judge err in striking out the PL Defendants' statement of defence for three reasons:

a. the PL Defendants were not in default at the time the motion to strike came before the motion judge;

b. the motion judge's order was disproportionate; and

c. the motion judge failed to recognize that any findings pertaining to GN Trim and / or 256 ought not to be applied to PL as a defendant in his personal capacity.

(2) Did the motion judge make three palpable and overriding errors in awarding costs against the KSD Firm:

a. there was no evidence that the firm knew about the November 2017 receivership of GN Trim before they disclosed that information to the motion judge at the June 28, 2018 case conference;

b. the KSD Firm's request for an adjournment to retain counsel and then not returning with counsel was not a delay tactic; and

c. the KSD Firm's provision of redacted copies of documents over which no claim for privilege was asserted was not a delay tactic.

holding:

Appeals dismissed.

reasoning:

(1) No.

a. The Court held that the motion judge thoroughly and accurately reviewed the disclosure and production orders made against the PL Defendants following the close of pleadings, which showed continued non-compliance by them. As well, the record clearly showed that at the time of the July 4, 2019 hearing, the PL Defendants were in default of a May 17, 2019 production order that ordered production by June 27, 2019 of: bank statements and cancelled cheques and the assignment of a lease of the Premises from 256 to 262.

b. The Court held that the motion judge's order was not disproportionate based upon the goal of accessible civil justice from Hyrniak v. Mauldin. In particular, the Court found that the PL Defendants should not be allowed to remain in default for over two years of their production obligations mandated by rules 30.06 and 30.08 of the Rules of Civil Procedure, especially because the monetary claim was relatively modest. In addition, the Court cited Starland Contracting Inc. v. 1581815 Ontario Ltd. to affirm that the motion judge was well within his authority as a case management judge to dismiss proceedings for repeated failure to comply with court orders. The Court was of the opinion that the motion judge had been more than generous in the opportunities he granted to the PL Defendants to cure their disclosure failures and the order to strike out their pleadings could well have been made much earlier.

c. The Court held that the record clearly demonstrated that PL controlled the disclosure of documents by each of the three PL Defendants and he was the party who filed the affidavits that sought to explain and justify the disclosure and production failures of the PL Defendants. In those circumstances, it was open to the motion judge to sanction the disclosure misconduct of the corporate PL Defendants by striking out the joint statement of defence because PL clearly directed that disclosure misconduct.

(2) No.

a. While the Court accepted the KSD Firm's submission that the record did not demonstrate whether the firm knew about the receivership before the June 13, 2018 case conference, it was not a palpable and overriding error to warrant reversing the costs decision, especially in light of the motion judge's subsequent findings that the KSD Firm employed delay tactics which justified the costs award.

b. The Court held that it was open to the motion judge to characterize the adjournment request as a delay tactic because he had been managing the case for almost one year and was in a good position to assess the litigation conduct of the PL Defendants and their counsel.

c. The Court also found that it was no surprise that the motion judge concluded that the KSD Firm "facilitated an expensive delay in this proceeding" when it brought to court redacted copies of documents over which no claim for privilege was asserted in the updated June 27, 2019 Affidavit of Documents.

The Court also took the opportunity to address an additional issue in respect of the cost appeal raised by Falcon: that the KSD Firm put itself in a conflict of interest position by appealing the cost order which was made "without recovery from their clients." The Court found it very troubling, in light of rules 3.4-2 and 3.4-3 of the Rules of Professional Conduct, that the KSD Firm acted for PL on the appeal when the firm was bringing its own appeal against the motion judge's award of costs against it.

Khan v. Law Society of Ontario, 2020 ONCA 320

[Feldman, Lauwers and Nordheimer JJ.A.]

Counsel:

OSK in person
Susan M Sack for the respondents, Law Society Tribunal, DW, RA, ML and BL
Gillian Kerr and Ljiljana Stanic for the respondents, Dr. MC and MC Medicine Professional Corporation
Gideon Forrest and Mitch Stephenson for the respondents, Legal Aid Ontario and VMC
Colleen E Robertshaw for the respondents, Hamilton Police Service and KD

facts:

On April 15, 2019, the appellant commenced an action in Milton against 16 defendants (the "Milton action"), which included the Law Society of Ontario ("LSO"), Legal Aid Ontario ("LAO"), a doctor and the Hamilton police. On August 23, 2019, the motion judge dismissed the Milton action as against 11 of the 16 defendants under Rule 2.1, on the basis that it was frivolous, vexatious or an abuse of process. The other five defendants had not sought a dismissal.

The appellant was the subject of a complaint to the LSO regarding alleged billing irregularities and allegedly forged documents. LAO was the complainant, the doctor testified at the LSO hearing and the police had conducted a related criminal investigation. In September 2018, upon making a finding that the appellant had committed professional misconduct, the LSO revoked his licence to practice.

issues:

(1) Did the motion judge err in referring to pleadings from other proceedings, since evidence is not permitted on a Rule 2.1 motion?

(2) Did the motion judge err in dismissing the claims against the doctor and police under Rule 2.1?

holding:

Appeal allowed in part.

reasoning:

(1) No. It may be necessary to review reasons and pleadings from other proceedings in order to make a determination whether the instant case is abusive. The case here was a good example of that. The court did not see any misdirection in the motion judge's conclusion that the action against the Law Society Tribunal, and the individual defendants associated with it, was an abuse of process in light of the outstanding appeal that the appellant has from the Tribunal's decision. To advance a claim arising out of a decision that is, itself, not final because of an outstanding appeal is, on its face, abusive.

(2) Yes. The motion judge misdirected himself with respect to the claim against the doctor and his corporation. This was not an obviously abusive claim. The fact that the doctor relied on the legal principle of absolute privilege in defence of the claim was a good indicator that the issue is not a simple one where it would be appropriate to invoke Rule In addition, the motion judge did not afford the appellant a full opportunity to make submissions on this issue, and it ought to have been left to be determined on a proper motion under Rule 21 with all the procedural safeguards such a motion includes. The Court reached the same conclusion regarding the claim against the police. The motion judge purported to determine various legal issues involving the claim against the police, including the parameters for claims of negligent investigation and for defamation respecting press statements issued by the police. These were not matters that should be determined on a Rule 2.1 motion. The Court reiterated that judges should be cautious about allowing parties to have recourse to Rule 2.1 except where it is plain and obvious on the face of the pleading that the action is frivolous, vexatious or an abuse of process. There are many other remedies provided for in the Rules of Civil Procedure by which parties can deal with cases that are not clear on the face of the pleading.

Barry v. Barry, 2020 ONCA 321

[Lauwers, Huscroft and Thorburn JJ.A.]

Counsel:

Michael H Murray, for the appellant
MAB, acting in person

facts:

Following a four-day trial to resolve financial issues arising from marital breakdown, the trial judge ordered that the respondent owed the appellant an equalization payment of $226,670.96. The order also granted the respondent the right to purchase the appellant's interest in the jointly-owned matrimonial home (the "Home") after a fair market value assessment. The appellant sought to vary the order to omit the respondent's right to conclude the purchase of the Home.

issue:

(1) Did the trial judge err in granting the respondent an order to purchase the appellant's interest in the Home?

holding:

Appeal allowed.

reasoning:

(1) Yes. While the respondent argued that the appeal was more properly within the jurisdiction of the Divisional Court, the Court of Appeal disagreed, stating that pursuant to s. 6(1)(b) of the Courts of Justice Act, this was an appeal from a final order of a judge of the Superior Court.

The appellant wanted to sell the Home and divide the proceeds in half, while the respondent wanted to purchase the appellant's interest in it. A right of first refusal is a substantive right that has economic value. It falls outside the boundaries of what is ancillary and what is reasonably necessary to implement the order for sale of the matrimonial home. It distorts the market for the sale of the matrimonial home by eliminating the need to compete against any other prospective purchaser, thus potentially reducing the amount the joint owning spouse realizes on the sale. In the absence of consent, the right of first refusal should not have been granted in this case. If the respondent seeks to purchase the matrimonial home, he must compete with any other interested purchaser.

Graff v. Network North Reporting and Mediation, 2020 ONCA 319

[Lauwers, Huscroft and Thorburn JJ.A.]

Counsel:

MG, acting in person
Jay Stolberg, for the responding parties Network North Reporting and Mediation and NK
Mark M O'Donnell, for the responding parties Johnson Inc. and Unifund Assurance Company
Visnja Jovanovic, for the responding parties Dutton Brock LLP and RSA, making no submissions
Brian Pickard, for the responding parties Kahler Personal Injury Law Firm Professional Corporation, DJL and BK
Alan L Rachlin, for the responding parties LV and LBV
Joel Reinhardt, for the responding parties Fox Psychological Services and AW
Monika S Korona, for the responding party Dr. V
Andrew Porter, for the responding parties Dr. PBW Medicine Professional Corporation and Dr. PW, making no submissions

Keywords: Civil Procedure, Summary Judgment, Appeals, Perfecting Appeals, Extension of Time, Sickinger v. Sickinger, 2017 ONCA 760

facts:

This is an appeal from the order of the motion judge dismissing the appellant's motion and granting summary judgment in favour of respondents.

The appellant filed an unperfected notice of appeal in January 2018. The appeal was administratively dismissed twice after the appellant was granted two extensions, which she ultimately failed to meet. The appellant subsequently moved to set aside the second dismissal of her appeal, which was dismissed by the motion judge. The appellant was granted a further extension to bring the current review motion, as it was also brought out of time.

On appeal, the appellant submitted that she demonstrated conviction in perfecting her appeal but the respondents did not provide her with the documents required to do so. She further argued that her submission materials had been tampered with.

The respondents submitted that they presented evidence before the motion judge demonstrating that all material that the appellant needed to perfect her appeal had been supplied to her well in advance of the scheduled perfection date.

issue:

(1) Did the motion judge err in dismissing the appellant's motion?

holding:

Motion dismissed.

reasoning:

(1) No. On a motion to set aside a dismissal order, the motion judge must assess the justice of the case, which includes consideration of the merits of the appeal and factors analogous to those typically considered on a motion to extend the time to appeal: Sickinger v. Sickinger, 2017 ONCA 760, at para. 13. In finding that the motion judge did as was required, the Court held that there was no basis to interfere with the motion judge's decision. The Court found that there was no evidence that someone tampered with the appellant's submission materials. The Court also held that there was no basis to conclude that the respondents did not reasonably assist the appellant in assembling the documentation necessary for perfecting her appeal. In any event, as was held by the motion judge, there was nothing in the record which suggested that the respondents' actions and negligence, if established, caused damage to the appellant. In this regard, the Court noted that the underlying action was related to prejudice allegedly caused to the appellant in the context of her outstanding action for injury suffered in a 2006 motor vehicle accident, which had yet to go to trial.

Welton v. United Lands Corporation Limited, 2020 ONCA 322

[Lauwers, Huscroft and Thorburn JJ.A.]

Counsel:

Sarah J Erskine and Shannon Bennett, for the appellant
Cameron D Neil, for the respondents

facts:

Stonebrook hired the appellant as Vice President of Marketing and Sales. After the appellant was terminated, a dispute arose concerning her compensation for sales and for additional services she provided. The case turned on the fact that the terms of the appellant's employment were never formalized. The appellant brought two actions for compensation: a 2012 action for unpaid sales commissions of about $1.35 million and a 2015 action for compensation in the amount of $440,000 related to a Tarion Warranty Claim. She appealed the trial judge's award of compensation to her on the basis that it was inadequate on the facts and the law. The appellant also sought leave to appeal the costs award in the 2012 action.

issues:

(1) Did the trial judge commit a palpable and overriding error in his assessment of the commission rates the appellant was to receive?

(2) Did the trial judge err in his assessment of compensation for additional construction services performed by the appellant?

(3) Did the trial judge err in dismissing the action for compensation for the appellant's work on the Tarion Warranty Claim?

(4) Did the trial judge err in applying Rule 49.10(2) costs consequences against the appellant?

holding:

Appeal allowed in part.

reasoning:

(1) No. The appellant argued at trial that the agreed remuneration was the greater of $220,000 per annum or 2% commission on sales revenue net of taxes. The trial judge identified ten material inconsistencies and contradictions in the appellant's evidence, which led him to reject her evidence as being "neither credible nor reliable". He found that the appellant failed to prove there was an agreement. In the Court's view, the trial judge's findings were amply justified by his extensive review of the evidence.

The appellant also argued that the trial judge made a palpable and overriding error by making a finding of an 'industry standard' commission rate of 1.5% in the absence of any evidence of such standard, and in conflict with the expert evidence adduced by both parties that there is no industry standard. The appellant also challenged the trial judge's deduction of amounts paid to sales staff. The Court rejected these submissions because the trial judge's decision was rooted in the available evidence.

(2) No. The appellant argued that she should have received an additional $100,000 per year from 2010 to the end of 2013 when she performed additional construction services previously performed by the Vice President of Development and Construction. However, the appellant provided no evidence as to the value of the additional construction services. Therefore, the Court deferred to the trial judge's findings on the issue because he did the best that could be done in the absence of evidence.

(3) No. The trial judge analyzed this claim under the rubric of unjust enrichment and applied the correct test: Moore v. Sweet, 2018 SCC 52. The trial judge dismissed the appellant's claim for unjust enrichment on the basis that, on the evidence, objectively it was not within the reasonable expectation of the parties that any of the appellant's services in 2013 would give rise to an after-the-fact claim for payment under the quantum meruit and unjust enrichment doctrine. The Court concluded that the trial judge identified and applied the correct legal principles in dismissing the 2015 action and the appellant did not identify any palpable and overriding factual errors.

(4) Yes. The trial judge found that he had residual discretion under Rule 49.13 to impose Rule 49.10(2) costs consequences on the appellant based on this court's decision in König v. Hobza, 2015 ONCA 885 ("König"). However, as the Court explained in König, in exercising those powers, a court must adopt a "holistic approach". In the Court's view, it was unreasonable for the respondents to make a last-minute settlement offer after the deadline expired and following a previous offer that can only be described as contemptuous. The respondents did not comply with "the spirit of rule 49": Lawson v. Viersen, 2012 ONCA 25. Accordingly, this was not an appropriate case where the Rule 49.10(2) costs consequences should apply against the appellant.

The Court concluded by expressing a concern about the length of the reasons for decision in this case, which is reflective of an unfortunately growing trend. The Court found the somewhat analogous function that trial judges perform in crafting criminal and civil jury instructions to be helpful guidance for trial judges to focus the analysis on the live issues that will decide the case. The task of a trial judge is to find the golden mean, to "decant and simplify," to synthesize the evidence and make the necessary findings; the task is not to be a court reporter. Many overly long decisions, including this one, contain what the Court would call a "factual data dump." This data dump does not constitute fact-finding. It hinders the efficient and economical communication of judicial reasoning.

Bowman v. Martineau, 2020 ONCA 330

[Rouleau, Hourigan and Roberts JJ.A.]

Counsel:

Paul Le Vay and Stephen Aylward, for the appellants
David A Morin and Peter Reinitzer, for the respondents

facts:

The appellant real estate agents acted both for the vendors, AE and SE, and the respondent purchasers on the sale of a house. The trial judge found the vendors liable to the respondents for non-disclosure and concealment of water damage. He also determined that the appellants were negligent in the execution of their professional responsibilities and therefore liable to the respondents. Specifically, the trial judge determined that the appellant real estate agent, SM, had failed to review and verify with the vendors and then with the respondents the information contained in the Sellers Property Information Statement ("SPIS"), concluding that if she had done so, SM would have discovered that the property suffered from ongoing water leakage.

The trial judge assessed the respondents' damages at $450,215.35: $332,706.59 for the cost to repair the property; $10,282.13 for out of pocket expenses for time and materials spent on the tearing out of the damaged portions of the house; $101,500 for the respondents' alternative living expenses from September 2014 to July 2019; $726.63 for hydro and insurance costs thrown away; and $5,000 in general damages. He apportioned the appellants' liability at 70% and the vendors' liability at 30%. Accordingly, judgment was granted against the appellants in the amount of $315,150.74 (70% of $450,215.35) and costs of $144,679.55.

issues:

(1) Did the trial judge err by applying a cost of repair rather than a diminution in value measure of damages?

(2) Did the trial judge err in concluding that the respondents had not failed to mitigate their damages?

(3) Did the trial judge err in determining that the frost heave damages were reasonably foreseeable?

holding:

Appeal allowed.

reasoning:

(1) Yes. Diminution in value was the proper measure of damages against the real estate agents. In cases where the harm to be compensated for is property damage, the Court noted that damages have typically been assessed either as the cost to repair the property or its resulting diminution in value. The historical common law position was that damage caused to real property was measured by the diminution in the value of the land (C.R. Taylor (Wholesale) Ltd. and others v. Hepworths Ltd., [1977] 2 All E.R. 784 (Q.B.)) but found that later English cases held that the cost of repair could be awarded in appropriate cases (Dominion Mosaics and Tile Co. Ltd. and another v. Trafalgar Trucking Co. Ltd. and another, [1990] 2 All E.R. 246 (C.A.), jurisprudence later adopted in Canada (James Street Hardware and Furniture Co. v. Spizziri, 1987 CanLII 4172 (Ont. C.A.)). The application of one or the other of these approaches has been governed by the specific facts of the particular case and the further regulating factors of causation, reasonableness and proportionality. In professional negligence cases involving real property, the jurisprudence is split as to whether the professional negligence actually caused the property damage. The Court found that the professional negligence of the appellants did not cause the water and mould damage to the property. Rather, the negligence amounted to causing the respondents to enter into a transaction they otherwise would have avoided. The trial judge misinterpreted the decision in Jarbeau v. McLean, 2017 ONCA 115 in finding that it stood for the general proposition that "cost to repair is a more appropriate measure of damages" when assessing loss related to defective property. The trial judge erroneously equated the respondents' loss with the loss of a house free of mould and water damage and the Court held that the loss that the respondents suffered as a result of the appellants' negligence was not property loss of this nature. Rather, the respondents' loss consisted of entering into a transaction to purchase a house damaged by water and mould (Avrom Evenchick (Trustee of) v. Ottawa (City) (1998), 111 O.A.C. 132 (C.A.)). The respondents were only ever entitled to damages to compensate them for entering into a bad transaction they would have otherwise avoided being their overpayment for the defective property: its diminution in value.

(2) No. The respondents were required to make reasonable efforts to mitigate their damages. It was the appellants' onus to demonstrate they failed to do so: Janiak v. Ippolito, [1985] 1 S.C.R. 146. The Court saw no error in the trial judge's conclusion that the appellants did not meet that onus. There was no evidence establishing that the respondents could have sold or walked away from the property, or that it was reasonable for them to take either course in their circumstances, which included their strained finances and obligations under the vendor-take-back mortgage.

(3) No. The appellants argued that the trial judge erred in his consideration of this issue in that the trial judge made inconsistent findings concerning the question of whether the frost heave damage was reasonably foreseeable. The Court found that the appellants were conflating the trial judge's findings on mitigation with those on remoteness of damages. The trial judge determined that it was fair and reasonable for the respondents to shut down the house rather than reinstate a heating system that they could not afford to operate in order to heat a house that was not insulated because of the gutting required by the water and mould damage. He also found that it was reasonable for the respondents to follow the measures recommended by a professional engineer to try to protect the house. As a result, he found that the appellants had failed to satisfy their onus to demonstrate that the respondents did not mitigate their damages. The trial judge's findings concerning causation and remoteness of damages were that "it is foreseeable that a home rendered inhabitable by mould and water damage cannot be lived in, that a home not lived in will not be heated and that an unheated home subjected to the effects of freezing temperatures during the winter months could suffer from floor heaving". In consequence, he determined that "the basement floor heaving is not so removed as to be unrecoverable". It was clear that the trial judge concluded that the frost heave was reasonably foreseeable and hence the necessity for the respondents' efforts to protect the empty house's foundation with straw as recommended by their engineering expert. What was not foreseeable, and therefore not a failure to mitigate on the part of the respondents, was that the recommended protective steps would not be effective. The trial judge effectively concluded that the failure of the recommended measures to adequately protect the foundation should not be visited against the respondents as a failure to mitigate their damages. His mitigation finding was separate from his findings respecting causation and remoteness. The Court found no inconsistencies or errors in the trial judge's findings.

Geliedan v. Rawdah, 2020 ONCA 339

[Lauwers, Paciocco and Fairburn JJ.A.]

Counsel:

Kristy Maurina, Michael J Stangarone and Edward C Conway, for the appellant
Matthew Gourlay, Farrah Hudani and Jessica Luscombe, for the respondent

facts:

The child at the centre of this litigation was born in the United Kingdom. After the parents separated, the father eventually went to live in Dubai. The mother and child later joined the father in Dubai. Well over a year after arriving in Dubai, the mother and child came to Ontario, where they have lived since. They had been in Ontario for only a short time before the father sought to have the child returned to Dubai.

The father obtained an order pursuant to s 40 of the Children's Law Reform Act to have the child returned to Dubai. The mother appealed from that order. The Court determined that the application judge erred in deciding the s 40 application without regard to a binding, valid Consent Custody Order in the U.K., one that specifically governs the circumstances under which the child could be removed from the U.K. Accordingly, the Court stayed the s 40 order on the condition that he promptly commence a similar proceeding in the court that issued the Consent Custody Order. In the event that the U.K. court declines to take jurisdiction, the Court ordered that the father could apply to the Ontario Superior Court of Justice to lift the stay and seek a rehearing of his s. 40 application. In that event, the mother could also bring her own application(s).

The father filed a motion to have the Court reconsider its appeal decision on the basis of new evidence arising from text messages sent by the mother to the father, suggesting that she now wishes to have the child returned to Dubai and to live with the father's family.

issue:

(1) Should the Court re-open the appeal?

holding:

Motion dismissed.

reasoning:

(1) No. The Court held that this is not one of the rare cases where an appellate court can re-open an appeal because no "very serious injustice" would result absent reconsideration of the matter re: Doman Forest Products Ltd. v GMAC Commercial Credit Corp. - Canada. The Court found that while the new evidence may be relevant to determining the father's application to have the child returned to Dubai, it was irrelevant to the Court's decision that the U.K. Consent Custody Order must be respected and the father must first pursue the matter there.

Van Delst v. Hronowsky, 2020 ONCA 329

[Rouleau, Hourigan and Roberts JJ.A.]

Counsel:

Rodney Cross, for the appellant
Katherine Shadbolt and David Migicovsky, for the respondent

facts:

In the present case, the most significant issue at trial was the valuation of the parties' federally regulated pensions for equalization purposes. Three aspects of the trial judge's reasons on this issue are challenged on appeal: (i) the determination of the parties' normal retirement dates; (ii) the decision not to include in the respondent's net family property the contingent interest she held in the appellant's pension; and (iii) the inclusion of a contingent survivor benefit in valuating the parties' pensions. While the trial judge reached the right conclusions on the survivor benefit and contingent survivor benefit issues, she erred in her approach to all three issues by failing to heed the requirement of s. 10.1(2) of the FLA that, in valuating pensions that are not provincially regulated, the Ontario method of valuation should be applied, with only necessary modifications.

The appellant and respondent were married in October 1995 and separated in September 2016. Both spouses worked for entities governed by the federal Public Service Superannuation Act, R.S.C. 1985, c. P-36 (the "PSSA"). The appellant became a pension member on December 4, 1984, and retired on December 17, 2016. The respondent started working for the Royal Canadian Mounted Police in 2008 and continues to be employed.

The respondent commenced an application in the Superior Court in May 2017 seeking orders for spousal support, child support and custody, along with the equalization of net family property. The most significant component of the net family property calculation was the values of the parties' pensions. According to s. 10.1(1) of the FLA, the imputed value for family law purposes of a spouse's interest in a pension plan is determined in accordance with s. 67.2 of the Pension Benefits Act, R.S.O. 1990, c. P.8 (the "PBA").

The trial judge concluded that the normal retirement date for the appellant was age 60 and for the respondent age 65. These conclusions were based on the pre-separation evidence of the parties' intended retirement dates. When she calculated net family property, the trial judge excluded the respondent's survivor benefits under the appellant's pension, because the respondent would lose her entitlement to those benefits at the time of divorce.

issues:

(1) Did the trial judge err in determining the parties' normal retirement date?

(2) Should the trial judge have included the survivor pension in the respondent's net family property?

(3) Did the trial judge err in including a contingent survivor benefit in the appellant's net family property?

holding:

Appeal allowed in part.

reasoning:

(1) Yes. Fixing a value for the normal retirement date for the plan at issue requires a modification. This is because "normal retirement date" is a defined term in the PBA meaning "the date or age specified in the pension plan as the normal retirement date of members": see s. 1(1). Plans regulated by the PBA must specify a normal retirement date: s. 10(1)4. However, the plan at issue is not regulated by the PBA and therefore is not required to, and does not, specify a normal retirement date. The definition is therefore not helpful and must be modified when applying the PBA rules to valuate these pensions for family law purposes.

(2) No. The trial judge accepted the respondent's submission that this amount should not be included. Her reasoning was that the respondent had asked for a divorce, which was consented to by the appellant, and therefore the appellant would not fall within the definition of a survivor within the PSSA.

(3) No. The appellant argues that the trial judge erred in including a contingent survivor benefit in valuating his pension. A contingent survivor benefit is payable to a pension member's future potential spouse. Some value for a contingent survivor benefit is included in the value of a pension based on the probability of the member having an eligible spouse at death and based on the age of the spouse. The appellant took the position that this figure should not be included in the value of his pension, whereas the respondent's expert included the figure in her pension valuation. The trial judge included these figures in calculating the value of both parties' pensions. The court found that the trial judge reached the correct result on this issue but erred in her analytical approach. As with the other pension issues, the correct approach was to determine what the law would require if this were an Ontario pension and then determine whether any modifications of that approach are necessary in the circumstances.

SHORT CIVIL DECISIONS

Windsor-Essex Children's Aid Society v. J.C., 2020 ONCA 328

[Benotto, Zarnett and Thorburn JJ.A.]

Counsel:

Aileen Manalang, for the appellants
Ronald Burnett, for the respondent

Keywords: Publication Ban, Family Law, Child Protection

CRIMINAL DECISIONS

R. v. S., 2020 ONCA 311

[Doherty, Juriansz and Miller JJ.A.]

Counsel:

Anne Marie Morphew, for the appellant
Samuel Greene and Molly Flanagan, for the respondent

R. v. G.J.S., 2020 ONCA 317

[Lauwers, Trotter and Fairburn JJ.A.]

Counsel:

Paul Calarco, for the appellant
Adam Wheeler, for the respondent

R. v. L., 2020 ONCA 324

[MacPherson, Pardu and Trotter JJ.A.]

Counsel:

Gerald Chan, acting as duty counsel
Andrew Hotke, for the respondent

R. v. M., 2020 ONCA 313

[Feldman, Tulloch and Jamal JJ.A.]

Counsel:

Ryan Heighton, for the appellant DM
Andrew Menchynski, for the appellant JW
Brendan Gluckman, for the respondent Her Majesty the Queen

R. v. B., 2020 ONCA 318

[Doherty, Watt and Miller JJ.A.]

Counsel:

Jessica Zita, for the appellant
Christine Tier, the respondent

Keywords: Criminal Law, Impaired Driving Causing Bodily Harm, Sentencing, R. v. Grant, 2016 ONCA 639

R. v. D., 2020 ONCA 326

[Strathy C.J.O., Tulloch and Coroza JJ.A.]

Counsel:

Howard Rubel, for the appellant
Vanita Goela, for the respondent

R. v. P., 2020 ONCA 323

[Doherty, Juriansz and Miller JJ.A.]

Counsel:

Richard Litkowski, for the appellant
Natalya Odorico, for the respondent

R. v. R.R., 2020 ONCA 327

[Doherty, Juriansz and Miller JJ.A.]

Counsel:

Richard Litkowski and Jessica Zita, for the appellant
Jennifer Trehearne, the respondent

Keywords: Publication Ban, Criminal Law, Sexual Assault, Evidence, Admissibility, Similar Fact Evidence, Character Evidence, Credibility, Sentencing, Bail Pending Appeal

R. v. S., 2020 ONCA 332

[Jamal J.A. (Motions Judge)]

Counsel:

Erin Dann, for the applicant
Gerald Brienza, for the respondent

United States v. A., ONCA 2020 331

[Doherty, Simmons and Pardu JJ.A.]

Counsel:

Christopher Bundy, for the appellant
Jeff Marshman, for the respondent

The information contained in our summaries of the decisions is not intended to provide legal advice and does not necessarily cover every matter raised in a decision. For complete information or for specific advice, please read the decision or contact us.

Article originally published on 31 May 2020

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Canada: Court Of Appeal Summaries (May 25 – 29, 2020)

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