Canada: Ontario Court Of Appeal Summaries (October 30 – November 3rd, 2017)

Good evening.

Below are this week's summaries of the civil decisions of the Court of Appeal for Ontario.

Another decision in the Yaiguaje v. Chevron Corporation case was released this week which ensures that there will be at least one further decision of the Court of Appeal to come in this case. Readers will recall that Chevron had obtained an order from a single judge of the Court of Appeal requiring the Ecuadorean villagers to post $942,951 as security for costs. It appeared that this might end the case before the appeal dismissing the claim to enforce their multi-billion dollar Ecuadorean judgment could be heard. However, a full panel of the Court set aside their colleague's order and held that it was not in the interests of justice to order security for costs in this case. The Court rested its decision on the fact that this was public interest litigation on behalf of 30,000 Ecuadorean villagers whose environment had suffered ecological devastation, the judgment they sought to enforce was to benefit all of them, and that Chevron, a multi-billion dollar international conglomerate, did not require the protection of a security for cost order.

Other topics covered included habeas corpus in the immigration context, construction law (liability for exaggerated claims), varying orders, approving MVA settlements involving parties with disabilities, family law (enforcing an Islamic marriage contract), class actions (judicial discretion in defining common issues), insurance coverage in the MVA context, the rectification of a will, and administrative law (Ontario Racing Commission).

Have a great weekend,

Civil Decisions:

Welton Estate v. Haugrud, 2017 ONCA 831

[MacFarland, Hourigan and Pardu JJ.A.]

Counsel:

Robert Rueter and David Barbaree, for the appellant

Craig Vander Zee, for the respondent The Bank of Nova Scotia in its capacity of Estate Trustee

Justin de Vries, for the respondent Catherine Haugrud

Michael Bordin and Karen Watters, for Simpson Wigle Law LLP

Bianca La Neve, for the Office of the Children's Lawyer

Keywords: Wills and Estates Law, Wills, Rectification

Facts:

The appellant was the widow of the deceased testator. She did not challenge the will, and elected to take under it. A motion was brought to correct an error made by the drafting solicitor. The evidence of the drafting solicitor was corroborated by that of the deceased's accountant. The motion was opposed only by the appellant.

Issues:

(1) Was the motion judge correct to proceed with the rectification motion before her?

(2) Should leave be granted to appeal costs?

Holding: Appeal dismissed.

Reasoning:

(1) Yes. The motion judge was correct to proceed with the rectification motion. The deceased's intention to liquidate shares that he owned in order to provide money to his children was apparent on the face of the will. The redemption of shares which he did not own when the will was drafted would not have provided this necessary funding. The motion judge made no error in receiving evidence of the drafting error, and the motion judge's factual findings were amply supported by the evidence.

(2) No. The motion judge was alive to the different considerations that apply in estate matters in relation to public policy issues.

Yaiguaje v. Chevron Corporation, 2017 ONCA 827

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

Counsel:

Alan Lenczner, Brendan Morrison, Kirk Baert and Celeste Poltak, for the appellants

Peter Grant, for the appellants

Benjamin Zarnett, for the respondent Chevron Canada

Larry Lowenstein, for the respondent Chevron Corporation

Keywords: Civil Procedure, Security for Costs, Rules of Civil Procedure, Rules 56.01(1)(a), 61.06(1)(b), Standard of Review, Discretionary Orders, Errors in Principle

Facts:

The appellants bring a motion to vary or set aside the order of the motion judge requiring them to post $942,951 as security for costs of the proceeding and the appeals in Yaiguaje v. Chevron Corporation (C63309 and C63310), both now pending in the Court of Appeal, prior to the hearing of the appeals.

The appellants, Yaiguaje et al, are residents of Ecuador who hold a judgment of US$9.5 billion against the respondent, Chevron Corporation, obtained in 2011. The judgment was the result of a claim for environmental damage that the appellants allege was caused by Texaco Inc., a company that later merged with Chevron Corporation. The appellants are representative plaintiffs for approximately 30,000 indigenous Ecuadorian villagers who have been affected by the environmental pollution.

In 2012, the appellants commenced an action in the Ontario Superior Court of Justice for the recognition and enforcement of the Ecuadorian judgment against Chevron Corporation and Chevron Canada, a seventh level, indirect subsidiary of Chevron Corporation.

The defences raised by Chevron Corporation include that the Ecuadorian judgment cannot be recognized or enforced in Ontario because, as the United States District Court for the Southern District of New York found in 2014, it was obtained by fraudulent means.

Chevron Corporation and Chevron Canada moved for summary judgment, submitting that the shares and assets of Chevron Canada are not exigible pursuant to the Execution Act, R.S.O. 1990, c. E.24, and that there is no basis to pierce the corporate veils between Chevron Canada and its indirect parent Chevron Corporation, in order to make Chevron Canada's shares and assets available to satisfy the Ecuadorian judgment against Chevron Corporation.

Justice Glenn Hainey accepted these submissions, granted summary judgment in favour of Chevron Corporation and Chevron Canada, and dismissed the plaintiffs' claim against Chevron Canada.

The appellants appealed the order of Hainey J., and Chevron Corporation and Chevron Canada brought a motion for security for costs of the proceeding and the appeals.

The motion judge found that the appellants had not established that they were impecunious or that third party litigation funding was unavailable. Because she found that impecuniosity had not been established, the motion judge ruled that the appellants had to demonstrate that their claim has a good chance of success. On a review of the merits of the claim, she found that the appellants had not met that onus. She therefore ordered the appellants to post security for costs and the appellants moved before a full panel to vary or set aside that order.

Issues: Did the motion judge err in ordering that the appellants post security for costs before the appeals could be heard?

Holding: Motion granted.

Reasoning:

Yes. Chevron Corporation and Chevron Canada relied on rules 56.01(1)(a) and 61.06(1)(b) of the Rules of Civil Procedure in support of their motion for security for costs. In an appeal, rule 61.06(1)(b) authorizes the Court of Appeal to make such an order for security for costs of the proceeding and the appeal "as is just" where an order for costs could be made under r. 56.01.

The appellants move pursuant to s. 7(5) of the Courts of Justice Act to review and set aside the order.

In support of their motion, the appellants question whether the motion judge erred in principle in determining the justness of the order sought. An error in principle is one of the bases on which the court may interfere with a discretionary order.

Even if the requirements of the rule are met, there is no entitlement to security for costs and the court may still exercise its discretion to refuse to order security for costs. In determining whether an order should be made for security for costs, the "overarching principle to be applied to all the circumstances is the justness of the order sought". In deciding motions for security for costs, judges are obliged to first consider the specific provisions of the Rules governing those motions and then to consider the justness of the order sought in all the circumstances of the case, with a focus on the interests of justice. The court held that the motion judge failed to undertake the second part of that analysis in this case.

The Rules explicitly provide that an order for security for costs should only be made where the justness of the case demands it. The court stated that judges must be vigilant to ensure that an order that is designed to be protective in nature, is not used as a litigation tactic to prevent a case from being heard on its merits – even in circumstances where the other provisions of Rules 56 or 61 have been met.

Factors to consider in determining the justness of security for costs orders include: the merits of the claim, delay in bringing the motion, the impact of actionable conduct by the defendants on the available assets of the plaintiffs, access to justice concerns, and the public importance of the litigation.

For the following reasons, the court concluded that in the interests of justice, no order for security for costs ought to have been made, and set aside the motion judge's order for security for costs:

1. This is a public interest litigation. The appellants are seeking to enforce a judgment in which they have no direct economic interest. Funds collected on the judgment will be paid into a trust and net funds are to be used for environmental rehabilitation or health care purposes.

2. Although there was no direct evidence of impecuniosity before the motion judge, it would be highly impractical to obtain this evidence from the representative plaintiffs, let alone the 30,000 people who would indirectly benefit from the enforcement of the judgment. There can be no doubt that the environmental devastation to the appellants' lands has severely hampered their ability to earn a livelihood.

3. In contrast to the position of the appellants, Chevron Corporation and Chevron Canada have annual gross revenues in the billions of dollars. It is difficult to believe that either of these two corporations would require protection for cost awards.

4. While the question of whether the Ecuadorian plaintiffs have third party litigation funding available to them was left unanswered, there should be no bright line rule that a litigant must establish that such funding is unavailable in order to successfully resist a motion in an appeal for security for costs.

5. At this stage, it cannot be said that this is a case that is wholly devoid of merit.

6. There is no doubt that the legal arguments asserted by the appellants are innovative and untested, especially with regard to piercing the corporate veil. But this does not foreclose the possibility that one or more of them may eventually prevail.

7. It is difficult to accept that the motion for security for costs was anything more than a tactic by Chevron Corporation to bring an end to the litigation.

Brooks v. Ontario Racing Commission, 2017 ONCA 833

[MacFarland, Hourigan and Pardu JJ.A.]

Counsel:

D Moore and K Jones, for the appellants

B van Niejenhuis and B Kates, for the respondents

Keywords: Administrative Law, Judicial Review, Standard of Review, Procedural Fairness, Natural Justice, Notice, Jurisdiction, Adequacy of Reasons, Newfoundland and Labrador Nurses' Union v. Newfoundland and Labrador (Treasury Board), 2011 SCC 62, Dunsmuir v. New Brunswick, 2008 SCC 9

Facts:

A judicial review application was brought by the Appellants, Bulletproof Enterprises ("Bulletproof") and its owner Jeffrey Brooks, in relation to three decisions. First, the Director of the Ontario Racing Commission ("ORC") issued a Suspension and Freezing Order against Mr. Brooks on the basis that his brother, David Brooks, had been involved in running Bulletproof, despite having been suspended by the ORC (the "Freezing Order"). Second, the ORC dismissed the appellants' motion to quash or stay both the Freezing Order and the Notice of Proposed Order to Suspend Licences (the "Notice of Proposed Order") and dismissed the motion in the alternative for particulars (the "Procedural Decision"). Third, after a hearing before a panel of the ORC, the panel made findings of wrongdoing against the appellants and ordered forfeiture of the frozen accounts, ten year licence suspensions, and a fine of $400,000 (the "Merits Decision").

The Divisional Court dismissed the application for judicial review. Justice Sachs, writing for the court, found that although the Director did not have jurisdiction to grant the Freezing Order, the granting of that order did not require the Merits Decision to be set aside because ultimately the panel had the power to seize the funds subject to the Freezing Order. She further found that both the Procedural Decision and Merits Decision were reasonable and the manner in which the proceedings were conducted did not breach the appellants' rights to natural justice. The Divisional Court's decision was appealed to the Court of Appeal.

Issues:

(1) Is the alleged failure of the panel to provide adequate reasons an issue of fairness therefore resulting in no applicable standard of review?

(2) Did the ORC's refusal to provide sufficient particulars amount to a deprivation of notice and a breach of procedural fairness?

(3) Did the panel's decision to allow Vice-Chair Donnelly to continue sitting as a hearing panel member after the expiration of his term of appointment result in the panel losing jurisdiction and the failure of the panel to permit the parties to make submissions on the issue constitute a breach of natural justice?

(4) Did the panel make unsupported factual findings, fail to address contradictory evidence, and provide reasons that were so inadequate that they amounted to a breach of procedural fairness?

Holding: Appeal dismissed.

Reasoning:

(1) No. This issue was conclusively answered by the Supreme Court of Canada in Newfoundland and Labrador Nurses' Union v. Newfoundland and Labrador (Treasury Board), 2011 SCC 62, which stated that: "Any challenge to the reasoning/result of the decision should [...] be made within the reasonableness analysis."

(2) No. The Divisional Court correctly held that the particulars in the Notice of Proposed Order constituted sufficient notice, such that the appellants understood the case they had to meet. The evidence led at the hearing related directly to the particulars contained in the Notice of Proposed Order. Moreover, the wrongdoing alleged in the Notice of Proposed Order was directly connected to the eventual findings of the panel at the merits hearing.

(3) No. The Court of Appeal's decision in Piller v. Assn. of Ontario Land Surveyors, 160 O.A.C. 333 is dispositive of this issue. Section 4.3 of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22 reads: "If the term of office of a member of a tribunal who has participated in a hearing expires before a decision is given, the term shall be deemed to continue, but only for the purpose of participating in the decision and for no other purpose."

Whether a "hearing" commences with preliminary motions, such that a member can be said to have "participated" is a question of statutory interpretation that is reviewable on a standard of reasonableness. The panel's conclusion that the member could continue to sit was not unreasonable given this court's jurisprudence in Piller.

(4) No. The adequacy of reasons is not a stand-alone basis for quashing a decision. The reasons must be read together with the outcome and assessed for whether the result falls within a range of possible outcomes. According to the Supreme Court in Newfoundland Nurses, "if the reasons allow the reviewing court to understand why the tribunal made its decision and permit it to determine whether the conclusion is within the range of acceptable outcomes, the Dunsmuir criteria are met". In this case, the reasons of the panel adequately explained the decision made and its underlying analysis.

The Court of Appeal was of the view that the panel made reasonable factual findings available to it on the evidentiary record. In this regard, it is important to note that the appellants called no evidence at the hearing. Their objection to the reasons amounted to nothing more than an assertion that the panel should have drawn different inferences from the evidence given by the ORC's witnesses. The panel's reasons allowed the Court of Appeal to understand why the tribunal made its decision, and the reasons together with the record enabled the court to conclude that the outcome was within the range of acceptable outcomes.

Ravenda Homes Ltd. v. 1372708, 2017 ONCA 834

[Hourigan, Brown and Roberts JJ.A.]

Counsel:

Peter H. Griffin, Constanza Pauchulo and Ryan Breedon, for the appellant

Robert C. Harason, for the respondents

Keywords: Contracts, Construction Law, Construction Liens, Liability for Exaggerated Claims, Construction Lien Act, R.S.O. 1990, c. C.30, s. 35

Facts:

The appellant, Ravenda Homes, and the respondent, 1372708, worked together to develop a residential subdivision in Fort Erie. Their working arrangement generated two written agreements. There is no dispute about the validity of the first written agreement, however there is a dispute about the validity of the second written agreement, dated December 13, 2005 (the "Disputed Agreement"), the terms of which provided that Ravenda Homes had the option to purchase from 1372708 developed lots without a deposit, and 1372708 anticipated obtaining municipal approvals and building permits by June 1, 2006.

On December 13, 2005, Ravenda Homes' lawyer sent by fax a copy of the Disputed Agreement, signed by Ravenda Homes, to the principal of 1372708, Vaughn Gibbons. The Disputed Agreement provided that it would be of no force and effect unless it was fully executed by the parties and returned, with the deposit set out in section 1(a) of the agreement, to Ravenda Homes, on or before 5:00 p.m. on that same day. The Disputed Agreement was signed and returned by 1372708 after the prescribed deadline.

Ravenda Homes built the three model homes and renovated the house into a sales office, marketed lots, and entered into 32 agreements of purchase and sale with potential homebuyers. Meanwhile, 1372708 pursued municipal approvals for the proposed plan of subdivision, so that services could be installed to support the homes to be built and the requisite building permits could be obtained.

Towards the end of the summer 2006, Ravenda Homes took the position that 1372708 had failed to act in good faith to take the necessary steps to obtain municipal approvals, which made it impossible for Ravenda Homes to meet its construction deadlines under the 32 agreements of purchase and sale. In September 2006, Ravenda Homes withdrew from the project on the basis that 1372708 had repudiated their agreement. Ravenda Homes commenced an action for breach of contract against the respondents (the "Contract Action"), registered a certificate of pending litigation, and commenced a construction lien action (the "Lien Action"). 1372708 counterclaimed for damages caused by Ravenda Homes' withdrawal from the project and the registration of the certificate and lien.

Following the respondents' motion for summary judgment, the motion judge dismissed Ravenda Homes' action for breach of contract, vacated its certificate of pending litigation, allowed Ravenda Homes' lien action, allowed 1372708's counterclaim in part, and referred to trial the issue of the parties' respective damages. Ravenda Homes appealed, and 1372708 cross-appealed.

Issues:

(1) Did the motion judge err in failing to find that the Disputed Agreement was enforceable?

(2) Did the motion judge err in awarding 1372708 damages for overpayment of annual fees and legal fees for the letter of credit that 1372708 posted to vacate Ravenda Homes' construction lien?

(3) Did the motion judge err in dismissing 1372708's counterclaim for damages for the payment of the property taxes on the model homes in the amount of $59,167.71?

(4) Did the motion judge err in finding that Ravenda Homes had a valid construction lien?

Holding: Appeal allowed in part. Cross-appeal dismissed.

Reasoning:

(1) No. As the motion judge observed, while Ravenda Homes could withdraw from the project, there was no breach by the respondents. These findings were open to the motion judge on the voluminous motion record, are free of error, and do not justify appellate intervention.

(2) Yes. The correct test under s. 35 of the Construction Lien Act, R.S.O. 1990, c. C.30 (CLA) required the motion judge to consider whether Ravenda Homes' lien claim was "grossly in excess" of what was ultimately proven to be owed under the lien, not merely "excessive". The court accepted Ravenda Homes' submission that the motion judge erred in making any such determination under s. 35 of the CLA, given that the amount of Ravenda Homes' lien had not been determined but was one of the issues that the motion judge referred to trial. As a result, the court set aside the provisions of para. 4 of the motion judge's order which relate to the granting of 1372708's costs incurred to post the letter of credit for the construction lien, which issue was referred to trial.

(3) No. The motion judge's determination was a factual one based on his assessment of the evidence of the parties' course of conduct, which was open to him to make on the record before him. seethe court saw no error or basis to interfere.

(4) No. The motion judge's findings at para. 155 of his reasons satisfy the criteria for a valid lien. While the motion judge did not expressly state that 1372708 impliedly requested that Ravenda Homes build the model homes, this can be inferred from his finding that 1372708 was an active participant who impliedly encouraged the building of the model homes in furtherance of the parties' agreement to develop the subdivision. As the motion judge stated: "The houses were built to benefit both 137 and Ravenda Homes". The sooner the lots were sold to Ravenda Homes, the quicker 137 would get its profit out of the project. Both parties recognized that the presence of model homes would improve the ability of Ravenda Homes to sell the lots. In fact, prior to the ultimate falling out between them, both parties approached the Town to seek permission to build additional model homes. Simply put, the improvements made on the three lots were made with the acquiescence of and for the benefit of 137. Appellate intervention was therefore unwarranted.

Jorisch v. Toronto Catholic District School Board, 2017 ONCA 845

[Watt, Pepall and Miller JJ.A.]

Counsel:

Howard R. Smith and Daniel J. Balena, for the appellants

No one appearing for the respondents

Keywords: Torts, Negligence, Civil Procedure, Parties with Disabilities, Settlements, Court Approval, Cost of Future Care, Legal Fees

Facts:

The appellant Wesley Jorsich suffered a severe brain injury in a high school rugby match. The appellants' action in negligence was settled before trial for $12,500,000, subject to judicial approval. Although the overall settlement was approved by the motion judge as fair and reasonable, he found that the settlement did not allocate sufficient funds to provide for Wesley's cost of future care. He also found that the solicitor's fees under a contingency fee agreement were excessive, reduced the fees from a 30% contingency fee to 20%, and disallowed a further $339,000. He applied the resulting surplus to the pool of invested funds used to generate funds for Wesley's monthly costs of care.

Issues:

1. Did the motion judge err in determining that insufficient funds were set aside to provide for future care?
2. Did the motion judge err in reducing the solicitor's fees?

Holding: Appeal dismissed.

Reasoning:

1. No. With respect to the motion judge's determination that the funds set aside in the settlement were insufficient to provide for future care, the appellants argue that the motion judge erred in preferring the submissions of the Office of the Public Guardian and Trustee, premised on an expected rate of return of 4.19%, over the report of the appellant's expert, which posited an expected rate of return of 10%.

The motion judge thoroughly canvassed the material before him, and came to a reasoned decision. The court saw no basis to interfere with his determination that the best interests of Wesley require allocating additional funds to future care.

2. No. The court found no basis to interfere with the motion judge's discretionary decision to reduce the fees of the appellant's solicitors. The court was not directed to any error that justifies interference with the decision.

Levac v. James, 2017 ONCA 842

[Blair, Juriansz and Miller JJ.A.]

Counsel:

D A Cruz and E J Baron, for the appellant

P Harte and M Damiano, for the respondent

Keywords: Torts, Negligence, MedMal, Civil Procedure, Class Actions, Certification, Common Issues, Summary Judgment, Natural Justice, Procedural Fairness, Notice, Opportunity to Make Submissions

Facts:

A Toronto pain management clinic experienced a bacterial infection outbreak. Several patients became infected, including the respondent, Anne Levac, who fell severely ill after receiving epidural injections for pain management. The appellant, Dr. Stephen James, an anaesthesiologist at the clinic, administered the epidural injections to Ms. Levac and other patients. Subsequent laboratory testing disclosed that Dr. James was colonized with the same strain of bacteria as six of the infected patients, including Ms. Levac.

Ms. Levac commenced an action against Dr. James, the clinic, the clinic nurses, and the clinic medical director. She alleged that Dr. James caused the outbreak by negligently implementing a substandard infection prevention and control practice. Ms. Levac brought a motion seeking certification of a class action and a motion for partial summary judgment against Dr. James. Both motions were argued one after the other on the same day and the motion judge issued one set of reasons and one order disposing of both. The motion judge certified the class proceeding against all defendants and granted summary judgment against Dr. James, finding that he had breached his duty of care to members of the class, that specific causation had been established for those class members infected with the same strain of bacteria found on Dr. James, and general causation for the remainder of the class. In his analysis of certification, the motion judge discarded the formulation of the breach of care common issue that he had certified at the certification hearing. Instead, he certified a fourth formulation, again of his own devising, but which the parties had no opportunity to consider.

Issues:

(1) Did the motion judge compromise procedural fairness when he certified and granted summary judgment on a formulation of the common issue that was different from the formulation that he had approved in an oral ruling when hearing the certification motion, immediately prior to hearing the summary judgment motion?

(a) Is a certification judge confined to the wording of issues proposed by the parties?

(b) Was the certification judge's change in wording of the formulation of the breach of care common issue an insignificant change that was merely a distinction without a difference?

(c) Is unfairness from a lack of notice of the common issues cured by the appeal process?

Holding: Appeal allowed.

Reasoning:

(1) Yes. There was a procedural unfairness and for that reason, the appeal must be allowed and the matter sent back for a new certification motion.

(a) No. A certification judge may, in some circumstances, depart from the wording of a common issue that the parties have agreed upon and proposed. The requirements of procedural fairness, however, impose limits on when and how that discretion may be exercised.

(b) No. It is instructive that the motion judge did not view his change to the question as a "distinction without a difference". On the contrary, he clearly understood the new wording as capturing "permutations of the duty of care issue" absent from the three previous formulations advanced at the motion hearing. In his view, the new wording better captured the "distinction between negligent performance and negligent design of the IPAC Practice". Whether it actually did so, without introducing issues not amenable to resolution on a class-wide basis or raising other concerns, was a question the parties ought to have been able to address through submissions to the motion judge.

The degree of difference between the two formulations is not the only consideration relevant to assessing procedural fairness. In this case, the following factors provide additional support for Dr. James' position:

1. the conduct of the proceedings: Dr. James reasonably expected that the motion judge would adhere to the agreed upon formulation of issues in his reasons for decision;
2. the importance of the common issue to the resolution of the action as a whole; and
3. the lack of any steps by the motion judge to address potential prejudice to Dr. James.

It is also significant that Dr. James may well have contested certification of the class proceeding had he known the certified common issue would be the one formulated by the motion judge. He was therefore deprived of the opportunity to contest not only the final formulation of the common issue, but certification of a proceeding premised on that issue.

(c) No. An appeal is not a trial de novo. The opportunity to argue an appeal with knowledge of the certified common issue does not cure the unfairness of arguing a summary judgment motion under a misapprehension about the common issue in question. Neither does the ability to contest the certified common issue on appeal provide an adequate remedy for the lack of opportunity to convince the motion judge against certifying that issue at first instance. It is crucial that litigants receive a fair process when they initially argue a certification motion, particularly because a certification judge's substantive conclusions are not easily set aside on appeal.

Trillium Motor World Ltd. v. Cassels Brock & Blackwell LLP, 2017 ONCA 840

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

Counsel:

Bryan Finlay, Q.C., Marie-Andrée Vermette, Michael Statham, David Sterns, Allan D.J. Dick and Andy Seretis, for the moving party

Peter H. Griffin and Rebecca Jones, for the respondent

Keywords: Civil Procedure, Appeals, Orders, Varying, Rules of Civil Procedure, Rules 1.04, 37.14(6), 59.06 and 61.16

Facts:

This court's decision in this solicitor's negligence case was released on July 4, 2017: Trillium Motor World Ltd. v. Cassels Brock & Blackwell LLP, 2017 ONCA 544 ("Trillium v. CBB"). The moving party, Trillium Motor World Ltd. ("Trillium"), brings a motion in writing to vary the court's direction to the trial judge set out at para. 404(3) of the court's reasons. Specifically, Trillium seeks an order stipulating that, on the new damages hearing directed by this court at para. 404, the trial judge retains discretion to determine the final quantification of damages and the process for calculating the final award of damages, subject to a ceiling of $36.9 million. The respondent, Cassels Brock & Blackwell LLP ("CBB"), resists the motion.

Issues:

(1) Does the trial judge retain discretion to determine the final quantification of damages and the process of calculating the final awards of damages?

Holding: Motion dismissed.

Reasoning:

(1) No. In support of its motion, Trillium relies on Rules 1.04, 37.14(6), 59.06 and 61.16 of the Rules of Civil Procedure.

Rule 61.16(6.1) states: Subject to rules 37.14 and 59.06, an order or decision of a panel of an appellate court may not be set aside or varied under these rules. The court was not persuaded that this is one of those rare cases in which it would be in the interests of justice to invoke this court's narrow jurisdiction under r. 59.06.

The July 2017 reasons of the court must be read as a whole and in the context of the issues raised and arguments advanced on appeal. The reasons do not address the mathematical approach to the calculation of damages at issue on this motion, as urged by CBB before the motion judge and rejected by him. That issue was not argued on the appeal.

Given the court's decision on appeal, the appropriate methodology and process for the calculation of damages in this case, including whether or not to adopt a mathematical approach to the quantification of damages in the manner urged by CBB, will be for the trial judge to determine at the new damages hearing. Subject to the directions provided by this court at para. 404, nothing in this court's reasons purports to constrain the trial judge's discretion in this regard.

Bakhshi v. Hosseinzadeh, 2017 ONCA 838

[Laskin, Feldman and Juriansz JJ.A.]

Counsel:

P. Di Monte, for the appellant
F. M. Wood, for the respondent

Keywords: Family Law, Domestic Contracts, Islamic Marriage Contract (Maher), Net Family Property, Excluded Property, Family Law Act, R.S.O. 1990, c. F.3., ss 4(2)6, 4(5)

Facts:

The parties entered into the Maher upon marrying in Iran on May 18, 1995. The parties immigrated to Canada after they married. Among other things, the Maher contained a clause requiring the husband to pay his wife 230 gold coins upon her prompt request.

On October 29, 2013, the wife issued an application in Ontario claiming a divorce, custody of their children, child support, equalization of NFP, and other relief.

At trial, the judge found that the equalization payment was "inclusive of the Maher". The judge found the value of the 230 gold coins were $79,580. Trial judge also found that the Maher, including the payment of the gold coins, was a valid and binding marriage contract under s.55 of the FLA since it was in writing, signed by both parties, and witnessed.

Trial judge found that the value of the Maher was to be excluded from the calculation of the NFP under s.4(2)6 which excludes from NFP, "property that the spouses have agreed by a domestic contract is not to be included in the spouse's net family property." Thus the trial judge treated the Maher payment as an additional amount owing to the wife above the equalization payment.

Issues:

(1) Did the trial judge err in his exclusion of the Maher payment from NFP pursuant to s.4(2)6 of the FLA?

Holding: Appeal allowed.

Reasoning:

(1) Yes. Agreements that satisfy the elements of a valid civil contract may be legally enforceable even where they have a religious aspect. The outcome of each case depends on the objective intentions of the parties ascertained through the particular wording of the Maher when read as a whole and considered in light of its factual matrix. As such evidence about the religious and/or cultural significance of the Maher to parties could conceivably be relevant. s. 4(2)6 of the FLA operates as an exception to the general rule that allows spouses to agree to exclude certain property from the NFP calculation. The trial judge erred in law by not reviewing the Maher to determine whether the spouses had actually made such an agreement.

Absent any evidence of an objective intention at the time of the contract to treat the Maher differently, the Maher payment must be treated under the FLA like any other payment obligation between the spouses. Bona fide inter-spousal debts must be included in NFP. Further, the effect of the deeming provision of s.4(5) is that transactions between spouses may affect the equalization payment where a spouse's net assets would otherwise be negative. Also, excluding transactions between spouses would be inconsistent with the separate property regime under the FLA, which continues during a marriage and terminates only on the triggering of the valuation date. The Maher payment must be included in NFP and the equalization order was varied as a result.

Middleton v. Pankhurst, 2017 ONCA 835

[Hourigan, Roberts and Nordheimer JJ.A.]

Counsel:

D H Rogers and M Rodrigues, for the appellant

M O'Donnell, for the respondent

Keywords: Contracts, Insurance Law, Coverage, MVA, Insurance Act, R.S.O. 1990, c. I. 8., Section 118, Statutory Condition 4(1) of O. Reg. 777/93, Kereluik v. Jevco Insurance Company, 2012 ONCA 338, Standard of Review, Standard Form Contracts, Correctness

Facts:

Middleton and Pankurst agreed to go ice fishing on January 24, 2009. Pankhurst travelled by snowmobile to meet Middleton, the former had a valid class G driver's licence. The licence was not subject to any restrictions, but Pankhurst was subject to a probation order arising from a guilty plea to careless driving in 2008, which prohibited him from driving at night or with alcohol in his system. The two parties consumed alcohol in an ice hut. Middleton walked home, but on his way got disoriented and asked Pankhurst to pick him up. Pankhurst picked him up and then drove him home. On the way home Pankhurst lost control of the snowmobile and both parties were ejected with Middleton suffering significant injuries.

The parties settled for $900,000. Pankhurst was insured by Aviva and Middleton was insured by Unifund. Middleton's insurance policy provided coverage for under or uninsured claims.

Statutory Condition 4(1) of O. Reg. 777/93 ("Condition 4(1)") applies to all Ontario automobile insurance contracts and provides that the insured shall not drive or operate....the automobile unless the insured... is authorized by law to drive or operate it.

Aviva took the position that it was not obliged to pay because Pankhurst was not authorized by law to drive at the time of the accident. The trial judge found that Pankhurst was authorized by law to drive at the time of the accident because he had a valid driver's licence that was not subject to any restrictions imposed by the Ministry of Transportation ("MTO"). The trial judge relied on the case of Kereluik v. Jevco Insurance Company, 2012 ONCA 338, 111 O.R. (3d) 395, where Cronk J.A found that the phrase "authorized by law" was not intended to apply to breaches of the law not directly connected with violations of driving licence conditions. Further, the trial judge held that Aviva's position was inconsistent with s.118 of the Insurance Act, RSO 1990, c. I.8.

Aviva appealed the decision.

Issues:

• Is this case distinguishable from Kereluik on the grounds that the restrictions imposed on the defendant related directly to the operation of a motor vehicle?
• Does section 118 of the Insurance Act apply to this case?
• Should the policy goals of ensuring broad insurance coverage trump the rule of law by undermining the sanctity of court orders?

Holding: Appeal dismissed.

Reasoning:

Prior to engaging in its analysis, the Court noted that the standard of review is correctness as the issue was the interpretation of a standard form contract of insurance.

• In Kereluik, the insured had been released from custody on an impaired driving charge. He was required to give a personal undertaking to abstain from the possession and consumption of any alcohol. The insured drove again while impaired and was involved in an accident where he was denied coverage on the basis that he was not authorized by law to drive. Justice Cronk held, , that the phrase "authorized by law" was not intended to apply to breaches of the law "not directly connected with violations of driving licence conditions." She also noted a broad interpretation of the phrase would be inconsistent with s. 118 of the Insurance Act. Justice Cronk concluded that compliance with Condition 4(1) depended only on the insured's possession of a valid driver's licence and compliance with its terms – not the terms imposed on driving pursuant to any other law.

In the present case, the Court found that it did not matter that the undertaking in Kereluik was broader in scope than the probation order in the case at bar. The principle remained the same. Further, on reviewing a number of authorities, Cronk J.A. in Kereluik concluded that the authorities suggest that "the legal authority to drive, at any given time, depends on the existence of a valid licence issued by the responsible regulatory authority and compliance with the conditions attaching to the licence." Thus the determination of whether an insured is authorized to operate a motor vehicle is restricted to a consideration of any restrictions imposed by MTO. Finally, the Court noted that overturning Kereluik could potentially deny coverage in any number of situations where there has been a criminal law violation which might preclude the compensation of a third party for losses caused by an impaired driver.

• Section 118 of the Insurance Act provides that "unless the contract otherwise provides, a contravention of any criminal or other law in force in Ontario...does not, by that fact alone, render unenforceable a claim for indemnity under a contract of insurance except where the contravention is committed... with the intent to bring about loss or damage." There is no meaningful distinction between a court order and "any criminal or other law in force in Ontario." Both can operate to restrict the operation of a motor vehicle. Further, the policy objective of section 118 is to provide insurance protection for negligent tortfeasors who do not intend to cause harm, and to their victims.
• There are legal consequences in criminal law for the breach of court orders. Ensuring broad policy coverage, in this instance, does not undermine the rule of law. The trial judge's reasons do not impact or undermine the effectiveness of court orders.

Ogiamien v. Ontario (Community Safety and Correctional Services), 2017 ONCA 839

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

Counsel:

Sharon Stewart Guthrie, Nicholas Dodokin, Monmi Goswami, and Marcia Pritzker Schmitt, for the appellant

Jamil Osai Ogiamien, acting in person

Brian Whitehead, for the Ministry of Community Safety and Correctional Services and the Attorney General of Ontario

Barbara Jackman, as amicus curiae

Keywords: Immigration Law, Detention, Habeas Corpus, Chaudhary v. Canada, 2015 ONCA 700, Immigration and Refugee Protection Act, Jurisdiction, Conditional Release

Facts:

The respondent Ogiamien came to the U.S. in 2001, as an undocumented immigrant. He later fled from criminal proceedings and entered Canada without permission and under an assumed name. In 2002 he was ordered deported from Canada for using an assumed name and for new criminal convictions. He returned to the United States to face outstanding criminal charges. After an unsuccessful refugee claim he was deported to Canada in 2005. He was detained for identity purposes, but released in 2006 with conditions on the ground that the time until the removal order would be executed was indeterminate. He reported to the CBSA in accordance with the ID release order, albeit on a somewhat irregular basis. He faced a number of criminal charges in Canada between 2009 and 2012. From 2006 until 2013, the CBSA took no steps to incarcerate him.

He was detained on criminal charges in Ontario in April 2013. As a result, he did not report to the CBSA under the terms of his ID release order. A CBSA arrest warrant was issued in February 2014 on the grounds that he had failed to report and that he was unlikely to appear for removal from Canada. The officer who issued the warrant testified in the habeas corpus proceedings that if he had known that he failed to report because of his criminal detention, he would not have issued the warrant. When he was released on bail for the criminal charges in May 2014, he was arrested pursuant to the CBSA warrant and remained in detention. The immigration detention at issue on this appeal began at that time. The criminal charges that led to his initial incarceration in April 2013 were withdrawn on July 16, 2014. His immigration detention was reviewed on a monthly basis by the ID but he remained detained until his release on habeas corpus in June 2016. By that time, he had been detained for immigration reasons for approximately 25 months.

Ogiamien commenced his habeas corpus application in August 2014. Initially, he sought access to legal resources and writing materials to allow him to challenge his detention in the Federal Court. The application evolved over the next several months. The application judge attempted to ascertain whether Ogiamien had an effective remedy in the Federal Court. In October 2015, following the appointment of amicus and the release of the court's decision in Chaudhary v. Canada, 2015 ONCA 700, 127 O.R. (3d) 401, the habeas corpus application was amended to assert that Ogiamien's detention had become unlawful due to its length and uncertain duration. The application judge heard several witnesses regarding Ogiamien's detention and the availability of relief in the Federal Court. Ogiamien commenced another habeas corpus application challenging the conditions of his detention. He was successful at first instance, but the Ontario Court of Appeal allowed an appeal from that decision.

The application judge found that Ogiamien had established reasonable and probable grounds that his detention was lengthy and of uncertain duration, and that the AG had failed to meet its onus of establishing that Ogiamien's continued detention was necessary to further the machinery of immigration control. She determined that Ogiamien was entitled to be released by way of habeas corpus.

About five months later, he was re-arrested by a CBSA officer because the officer believed Ogiamien had breached the conditions of his release by inaccurately completing an application for a Nigerian travel document. Ogiamien's sister withdrew as his surety, and the AG consented to Ogiamien filing a new application for judicial interim release. However, at the hearing, the AG argued that absent a fresh habeas corpus application, there was no legal mechanism pursuant to which the application judge could consider Ogiamien's second application for release. The application judge rejected this argument, and held that the breaches alleged by the AG, including Ogiamien's completion of the Nigerian travel document, did not warrant his re-incarceration. She ordered his release on conditions similar to the first release order. The Attorney General of Canada ("AG") appeals both decisions involving the detention of the respondent and his subsequent release.

Issues:

First Appeal

(1) Did the application judge err in finding that Ogiamien had met the threshold established in Chaudhary for assuming habeas corpus jurisdiction, and did the application judge err in finding that the detention was unlawful?

(2) Were there additional grounds upon which the application judge could have granted habeas corpus?

(3) Did the application judge err by quashing the ID detention order and imposing conditions to be supervised by her upon Ogiamien's release?

Second Appeal

(4) Did the application judge err by considering Ogiamien's request for release from immigration detention when he was re-arrested following his release on habeas corpus?

Holding: First appeal dismissed. Second appeal allowed in part.

Reasoning:

(1) No. Habeas corpus applications proceed in two stages. At the first stage, the applicant must show that he or she has been deprived of liberty and there is a legitimate ground upon which to question the legality of the detention. If the applicant succeeds in meeting that threshold, the onus shifts to the authorities to show that the deprivation of liberty is lawful. The application judge applied the Chaudhary test to determine at the first stage that she should assume habeas corpus jurisdiction. She found that Ogiamien had raised a legitimate ground upon which to question the legality of his detention, namely that his immigration detention was lengthy and of uncertain duration. The AG did not advance any argument that would justify the court interfering with the application judge's findings. The reason for Ogiamien's immigration arrest and detention was that he had failed to report and that he was alleged to be a flight risk, which was a sound finding. While he undoubtedly had an obligation to provide information as to his identity, any failure on his part to fulfil that duty should not have significant bearing on the assessment of the length of his detention.

The application judge did not err in taking into account the entire history of the immigration proceedings and the conduct of the CBSA to assess the length of the detention. The CBSA's failure to conduct an effective investigation for over eight years, combined with the fact that Ogiamien was not arrested because of any problem in determining his identity or country of origin, supports the application judge's inference that the length of the detention could not be explained away because of any lack of cooperation on Ogiamien's part.

The application judge did not make a palpable and overriding error of fact in finding that Ogiamien did cooperate to some extent with the CBSA regarding his identity. She carefully considered the evidence and did not gloss over some of Ogiamien's evasive and inaccurate responses to CBSA inquiries. The application judge also did not err by rejecting the contention that Ogiamien's failure to participate in the statutory ID reviews or to seek judicial review in the Federal Court should be held against him in calculating the length of his detention. He participated in the ID reviews for the first 18 months of his detention and there was nothing to suggest that either the ID or the Federal Court would have released him had he pursued those processes. There was also no evidence in the record before her to suggest that identity documents required to effect Ogiamien's removal would be forthcoming in a timely manner from the Nigerian authorities. The application judge made no error that would justify disturbing her finding that Ogiamien satisfied the first stage of the habeas corpus analysis by showing that there is a legitimate ground upon which to question the legality of the detention, namely, that the detention was of lengthy and uncertain duration.

At the second stage, the onus shifts to the AG to justify the detention. The AG submitted that the immigration purpose justifying the detention was that Ogiamien is a flight risk. The application judge rejected that argument listing several factors, including the fact that he "was on immigration release from 2006 to 2014 and never tried to leave Canada." The application judge's reliance on this fact is problematic, but her finding that he was not a flight risk did not rest on that fact alone. He had presented a viable release plan, and the timing of the deportation remains uncertain, so the risk of flight was not increased on that account. The application judge also did not err by relying on the fact that Ogiamien has a son in Canada as a factor. Lack of ties to the community may militate in favour of detention, as ties to the community may support the inference that the individual would appear for removal. When the record is considered as a whole, there was no legal error and there was sufficient evidence to support the application judge's finding that the AG failed to demonstrate that Ogiamien's continued detention was justified on the ground that he is a flight risk.

(2) No. As the application judge's decision to order Ogiamien's release on habeas corpus was affirmed, it was not necessary to consider these additional grounds. However, the court rejected the AG's contention that habeas corpus will only be available in immigration matters in the case of lengthy detentions of uncertain duration and that the reach of Chaudhary is restricted to its precise facts. That submission ignores the more general principle upon which Chaudhary rests, which is that the Superior Court retains its residual jurisdiction to entertain habeas corpus applications where the IRPA process of review under the supervision of the Federal Court is less advantageous than habeas corpus, and where releasing the applicant would not alter the immigration status of the applicant or amount to a collateral attack on an immigration decision. Amicus' submission that the additional grounds raised by Ogiamien fall within the scope of that principle was also rejected.

(3) Yes. The AG argued that only the Federal Court could quash the detention order and that the application judge exceeded her jurisdiction in doing so. The issue of whether the application judge should have quashed the detention order in the context of this proceeding was of no practical effect. Once Ogiamien was released on habeas corpus, the effect of the detention order was exhausted.

The application judge's order released Ogiamien on terms that she described as "judicial interim release pending his removal from Canada". The conditions of release included a recognizance in the amount of $30,000 without deposit but with a named surety who was required to make a deposit of $1,000, as well as further conditions including a curfew and regular reporting. The order also provided that the Superior Court and the application judge would remain seized of the matter to deal with any requested changes or alleged breaches and would monitor any attempt to re-incarcerate Ogiamien on the basis of any alleged breach of the terms. The court did not accept the general proposition advanced by the AG that a judge has never had authority to impose conditions when granting habeas corpus. It would be inconsistent with the public interest if the judge on habeas corpus lacked the authority to impose appropriate conditions to protect public safety and respect for the law.

However, the application judge erred by assuming the power in clause 13, which specified that the application judge would retain jurisdiction to review any subsequent arrest or detention. On the basis of the law of habeas corpus, the CBSA could not re-arrest or re-incarcerate Ogiamien following his release on the same grounds the application judge had found were wanting in law. It was therefore unnecessary for the application judge to retain jurisdiction. Further, a judge ordering judicial interim release does not ordinarily retain jurisdiction to supervise the enforcement of the conditions imposed. Third, unless and until the Federal Court determines that Ogiamien is no longer subject to a valid deportation order, he remains subject to the IRPA scheme. Given the IRPA governed, the application judge should not have assumed authority under clause 13 to require the CBSA to bring the matter back before her in the event Ogiamien were rearrested pursuant to the IRPA.

It is common ground that the order for judicial interim release effectively ended when Ogiamien was re-arrested and it is therefore unnecessary to deal with clause 13 in the first appeal. However, as that clause was varied and attached to the subsequent order for judicial interim release, the second appeal was allowed, with respect to those parts of the order by which the application judge retained jurisdiction.

Any conditions a judge imposes should take into account that the ID's jurisdiction will be invoked if the person is re-arrested, and the judge should minimize the potential for jurisdictional confusion and conflict. The judge should also be mindful of the conditions typically imposed by the ID. Further, the order imposing conditions should provide that the conditions may be varied either by order of the court or of the ID. If the court is asked to vary the conditions, the court should ordinarily decline to exercise its jurisdiction and defer to the ID.

Accordingly, in addition to striking clause 13, the court struck clause 12 and replaced it with a term providing the conditions may be varied or vacated if circumstances change by order of either the Superior Court or ID. Clauses 3, 5, and 11 were amended to provide that those conditions may also be varied or vacated if circumstances change by either the court or the ID.

(4) The application judge should not have assumed jurisdiction over the supervision of the conditions of Ogiamien's release in clause 13. She therefore should not have considered Ogiamien's second application for release. However, the AG consented to Ogiamien bringing that fresh application. The AG does not seek to re-incarcerate Ogiamien at this point. As clause 13 is to be struck from the conditions of release, it was neither appropriate nor necessary to consider this ground of appeal further.

Short Civil Endorsements:

2122994 Ontario Inc. v. Lettieri, 2017 ONCA 830

[MacFarland, Hourigan and Pardu JJ.A]

Counsel:

Morris Cooper, for the appellants

Adrienne Boudreau and Krishana Persaud, for the respondents

Keywords: Contracts, Franchise Law, Duty of Fair Dealing, Arthur Wishart Act (Franchise Disclosure), 2000, S.O. 2000, c. 3, ss. 3, 6(6)(a), Civil Procedure, Evidence, Cross-Examination

S.S. v. Kantor, 2017 ONCA 828

[Weiler, van Rensburg and Huscroft JJ.A.]

Counsel:

Gillian T. Hnatiw, for the appellant

Joan C. Manafa, for the respondent

Kendra A. Naidoo and Michele M. Warner, for the intervener, Ontario's Specialty Mental Health Hospitals

Keywords: Health Law, Consent and Capacity Board, Community Treatment Order, Mental Health Act, R.S.O. 1990, c. M.7

Smith v. Allstate Insurance Company, 2017 ONCA 843

[Sharpe, Rouleau and Fairburn JJ.A.]

Counsel:

Jordan B.R. Palmer, for the appellant

Meredith A. Harper, for the respondent

Keywords: Insurance Law, Denial of Benefits, Turner v. State Farm Mutual Automobile Insurance Co., 2005 CanLII 2551

White v. White, 2017 ONCA 844

[MacFarland, Hourigan and Benotto JJ.A.]

Counsel:

Matthew Tubie, for the appellants

Rick Bickhram, for the respondents

Keywords: Torts, Defamation, Fresh Evidence, Palmer v. The Queen, [1980] 1 S.C.R. 759

Criminal and Review Board Decisions:

R. v. C.R.A., 2017 ONCA 826

[Feldman J.A.]

Counsel:

Ms. Gerri Wiebe, for the appellant

Ms. Rebecca Schwartz, for the respondent

Keywords: Publication Ban, Criminal Law, Sexual Assault, Criminal Code, s. 679(3), Sentencing, R. v. Oland, 2017 SCC 17

R. v. Balfour, 2017 ONCA 832

[Laskin, Feldman and Blair JJ.A.]

Counsel:

Mark Halfyard, for the appellant

Jennifer McKee, for the respondent

Keywords: Criminal Law, Fraud, Evidence, Hearsay

R. v. McConville, 2017 ONCA 829

[Gillese, Huscroft and Trotter JJ.A.]

Counsel:

Richard Litkowski, for the appellant

Michelle Campbell, for the respondent

Keywords: Criminal Law, Robbery, Evidence, Eyewitness Identification, Sentencing, Dangerous Offenders, Criminal Code, s. 753(4.1)

R v Romano, 2017 ONCA 837

[Cronk, Juriansz and Paciocco JJ.A.]

Counsel:

Roger Shallow, for the appellant

Frank Addario and James Foy, for the respondent

Keywords: Criminal Law, Dangerous Driving Causing Death, Jury Charge, Causation, R. v. Luciano, 2011 ONCA 89, 273 O.A.C. 273, R. v. Wong (2006), 211 O.A.C. 201 (C.A.)

R v Orwin, 2017 ONCA 841

[Watt, Epstein and Brown JJ.A.]

Counsel:

Robert F. Goddard, for the appellant

Jill Witkin, for the respondent

Keywords: Publication Ban, Criminal Law, Sexual Assault, Defences, Honest but Mistaken Belief, Evidence

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.