Please find below our summaries of the civil decisions of the Court of Appeal released during the week of July 27 to 31, 2020.
In Manthadi v. ASCO Manufacturing, the Court reviewed in detail the difference between the common law and the Employment Standards Act relating to the determination of whether a party purchasing a business is a successor employer and the proper notice period for wrongful dismissal.
In Le Treport Wedding & Convention Centre Ltd. v. Co-operators General Insurance Company, the Court reviewed in detail the policy wording of an "All risks" insurance policy before determining that a flood arising out of the great Toronto rainstorm of July 8, 2013 was a "flood" within the meaning of the policy.
In M.A.A. v. D.E.M.E. , a child abduction case, the Court reviewed in detail the law relating to the making of a custody and access order under s. 23 of the Children's Law Reform Act in the context of a refugee claim made by the mother and her children. The Court determined that the application of the international immigration law principle of non-refoulement meant that a removal order under s. 40 of the CLRA could not be made in the face of a pending refugee claim.
Finally, in Arconti v. Fenton, the Court confirmed that a client cannot sue his or her lawyer in negligence after being convicted (in this case, of securities law offences), when their appeal from their conviction on the basis of ineffective assistance of counsel was rejected by the appellate court. To allow such a claim would be an abuse of process and collateral attack on the conviction.
[Doherty, Juriansz and Paciocco JJ.A.]
John S. Contini, for the appellant
Jonathan Pinkus, for the respondent
Keywords: Contracts, Employment, Wrongful Dismissal, Successor Employers, Civil Procedure, Simplified Procedure, Summary Judgment, Employment Standards Act, 2000, S.O. 2000, c. 41, s. 9(1) Rules of Civil Procedure, Rule 76, Bardal v. The Globe & Mail Ltd. (1960), 24 D.L.R. (2d) 140 (Ont. H.C.), Combined Air Mechanical Services Inc. v. Flesch, 2011 ONCA 764, rev'd on other grounds, 2014 SCC 7, Singh v. Concept Plastics Limited, 2016 ONCA 815, Hryniak v. Mauldin, 2014 SCC 7, Howard v. Benson Group Inc. (The Benson Group Inc.) , 2016 ONCA 256, leave to appeal refused,  S.C.C.A. No. 240, Ceccol v. Ontario Gymnastic Federation (2001), 55 O.R. (3d) 614 (C.A.), Addison v. M. Loeb Ltd. (1986), 25 D.L.R. (4th) 151 (Ont. C.A.), Sorel v. Tomenson Saunders Whitehead Ltd. (1987), 39 D.L.R. (4th) 460 (B.C.C.A.), Debenham v. CSI-Maximus (2003), 26 C.C.E.L. (3d) 32 (Ont. C.A.), Minott v. O'Shanter Development Co. (1999), 168 D.L.R. (4th) 270 (Ont. C.A.), Love v. Acuity Investment Management Inc. , 2011 ONCA 130, leave to appeal refused,  S.C.C.A. No. 170,
The respondent was initially employed on February 7, 1981, by one of the third parties to this action, 63732 Ontario Limited ("637"). On or about November 2, 2017, the appellant purchased the assets of 637 along with the business name "ASCO". The respondent worked for ASCO for approximately one month when she was placed on layoff on December 13, 2017, and never recalled. She sued ASCO for wrongful dismissal under the simplified procedure, and ASCO brought a third party claim against 637.
In the Agreement of Purchase and Sale (APS) between the appellant and 637, the appellant obtained a warranty from 637 stating, among other things, that 637 had provided notice of termination and paid severance to all its employees. 637 also agreed to indemnify the appellant against all claims arising from a breach of its warranties.
The respondent's evidence was that 637 presented her with a Settlement and Release Agreement (SRA), and advised her that the business was being sold and she would be offered continued employment with the appellant. In the Settlement and Release Agreement, the respondent acknowledged receiving written notice her employment would terminate on November 24, 2017, and that she would be paid $5,900 "representing 8 weeks gross compensation in full satisfaction of all claims ... including all severance pay, termination pay or other compensation howsoever arising". She released 637 from all liability "in connection with the Employee's employment with 637, including without limitation the cessation of such employment."
The respondent was one of twenty of 637's employees who were employed by the appellant. The terms of her employment with the appellant and the capacity in which she was employed by the appellant are disputed. The appellant's position was that it hired the respondent, along with nineteen other 637 employees for general labour work to pack and unpack the purchased assets for the move to the appellant's place of business. The appellant also says it "did not assume the continuity of 637's employees" or "recognize 637's employees' prior years of service rendered with 637." The respondent said she was offered and accepted employment by the appellant on an indefinite basis. She stated she understood that the appellant would recognize her years of service with 637 and that she continued to work as a welder without interruption. However, she agreed that she assisted the appellant with moving the purchased assets to a new location from December 4, 2017, onward until she was laid off.
On these facts, the motion judge granted the respondent's motion for summary judgment. She held that the respondent "had been continually employed from 1981 to 2017, a period of 36 years", concluded that the proper notice period was 20 months, and awarded the respondent $66,391.40 for damages for wrongful dismissal plus $11,958.96 for costs.
- Was summary judgment appropriate?
- Did the motion judge err in holding that the respondent was entitled to damages in lieu of reasonable notice of termination?
- Did the motion judge err in assessing the quantum of damages in lieu of reasonable notice?
1. No. In Combined Air Mechanical Services Inc. v. Flesch, 2011 ONCA 764, rev'd on other grounds, 2014 SCC 7, a five-judge panel of the Court indicated, while a motion for summary judgment could be appropriate in some Rule 76 proceedings, such cases would be exceptional. This was for two reasons. First, it will often be more efficient to simply proceed to a summary trial as contemplated by the Rules. The simplified procedure rules are designed to get the parties to trial with a minimum of delay and costs. One of the key objectives of the simplified procedure rules is to limit the extent of pretrial proceedings. Discovery is restricted and cross-examination on affidavits and examinations of witnesses on motions are not allowed. The summary trial procedure is designed to reduce the length of the trial. A judge faced with a contested motion for summary judgment in a simplified procedure action will need to assess whether entertaining the motion is consistent with the efficiency rationale reflected in the simplified procedures. While the Supreme Court's foundational summary judgment decision in Hryniak v. Mauldin, 2014 SCC 7, did not specifically address how summary judgment applies in a simplified procedure case, the Supreme Court did affirm that the motion judge must assess, among other things, "the relative efficiencies of proceeding by way of summary judgment, as opposed to trial" and the impact of summary judgment on the litigation as a whole when determining whether it is in the interests of justice to exercise their fact-finding powers and grant summary judgment:
Second, the simplified procedure rules, which are designed to allow the matter to be determined in an expedited fashion, also constrain the parties' ability to marshal evidence on a summary judgment motion and meet their obligation to put their best foot forward. In this case, the appellant submitted it was hampered because it could not cross-examine the respondent on her affidavit supporting the motion and did not have the evidence of the third party, 637. The respondent countered with the argument that the appellant could have examined the respondent and the third parties for discovery (though the parties had initially agreed to proceed without discoveries). These submissions illustrated that summary judgment motions should be discouraged where they would simply require the parties to prepare for and deal with additional procedures, expending resources and time that would have enabled them to proceed to a summary trial. As the Court observed in Combined Air, "the inappropriate use of Rule 20 has the perverse effect of creating delays and wasting costs associated with preparing for, arguing and deciding a motion for summary judgment, only to see the matter sent on for trial." The risk of this perverse consequence is greater in simplified procedure cases. The motion judge in this case did find that the motion for summary judgment was "the most proportionate, most expeditious, and least expensive method of adjudication of the issues". But apart from expressing that conclusion, the bulk of her analysis was directed to her ability to decide the issues. She held that she was able to decide the issues because she took the view that the matters in dispute were not material. However, the factual disputes that the motion judge could not and did not resolve on the record before her were genuine issues requiring a trial. This was a case in which the parties had agreed to proceed without any discoveries but where cross-examination on the general assertions in both parties' affidavits was necessary to resolve the competing evidence. Allowing the matter to proceed to a summary trial would have ensured a fair and just determination on the merits while also disposing of the third party claim.
2. Yes. This was an issue requiring a trial. While the common law implies a term in contracts of indefinite employment requiring an employer to provide reasonable notice upon terminating an employee without cause, there is no such implied term in fixed term employment contracts. In this case, the motion judge did not resolve the dispute about the basis on which the appellant hired the respondent. The appellant's argument that it hired the respondent on a temporary basis for the specific task of moving the equipment amounted to a claim she was a fixed term employee, which, if accepted at trial, could support finding she was not entitled to notice of termination from the appellant at common law.
Fixed term employment may be defined not only by a definite period of time, but also by the duration of a specific task, or by reference to the happening of a specified event. A fixed term employee who is terminated before the end of the term is entitled to payment of their wages to the end of the term, absent agreement otherwise. An employer is not required to provide notice of termination at common law when the term expires, since the employment agreement simply terminates in accordance with the contract. On the other hand, if it is found that appellant hired the respondent on an indefinite basis, she would be entitled to reasonable notice and it would be necessary to assess the period of notice the appellant was required to provide. The motion judge proceeded on the view that the common law supported the same "concept of continuous employment" as did s. 9(1) of the ESA. This explains why she found it unnecessary to resolve the disputes between the parties. The fact that the respondent, an employee of the vendor of a business, was employed by the purchaser of the business was sufficient to establish she was continuously employed and entitled to reasonable notice from the appellant. The motion judge reasoned she had all the facts necessary to find the notice period. A sharp distinction must be drawn between termination of employment by a successor employer under the ESA and under the common law. While the ESA is clear that the employment of employees of the vendor of a business who are employed by the purchaser is deemed not to be terminated for the purposes of the ESA, the common law is equally clear that such employees are terminated (by constructive dismissal) when their employer sells the business and there is a change in the identity of the employer. At common law, since a contract of personal services cannot be assigned to a new employer without the consent of the parties, the sale of the business, if it results in the change of the legal identity of the employer, constitutes a constructive termination of the employment. If the employee is offered and accepts employment by his new employer, a new contract of employment is entered into. In this case, no matter what is made of the SRA, the respondent's employment by 637 was terminated when 637 sold its assets and business name to the appellant. Accordingly, it was necessary to make findings about the nature of the new employment agreement between the respondent and the appellant.
Once the employee accepts employment with the new employer, thereby establishing a new contract, he will probably "mitigate himself right out of his cause of action" against his former employer. If he fails to accept the new job and it is in all respects fundamentally the same as his old one, he is likely precluded by the doctrine of mitigation from recovering any loss sustained on the constructive termination on the basis that such loss could reasonably have been avoided. The unfortunate employee is caught in a bind and will inevitably suffer at least the loss of his perhaps lengthy service with the former employer. If, on the other hand, the new employer declines to employ the individual, the termination becomes express rather than constructive and the former employer will remain liable for any properly recoverable damage sustained by the employee. Thus, long-term employees, who are employed by the purchaser of their employer's business, have little prospect of obtaining damages for the termination of their employment. Damages aside, people need jobs. Employees terminated by the sale of a business often have no realistic option other than to accept the offer of a new contract of employment with the purchaser if such is offered. If they are subsequently terminated by the purchaser, the new start date of their term of service weighs in favour of a shorter notice period than had the business not been sold. Addison resolves this predicament by giving "some recognition" to the period of employment with the predecessor employer when determining the length of the notice period unless there is "an express understanding to the contrary". It does so by attaching appropriate weight to the employee's "experience", one of the factors in the generally accepted formulation for the determination of reasonable notice.
Addison remains the law in Ontario. In Ontario, reasonable notice is determined by applying the usual Bardal factors considering all the circumstances of the particular case and appropriately weighing the experience a long-time employee brings to the purchaser. The application of the Bardal factors is well able to deal with a successor employer situation fairly. The length of service factor should not dominate the application of the Bardal factors. The so-called "rule of thumb" by which the starting point in determining reasonable notice would be to allow one month of notice for each year of service and then make adjustments for the particular circumstances of the case was not warranted in principle nor supported by authority. The rule of thumb approach "risks overemphasizing one of the Bardal factors, 'length of service', at the expense of the others" and it gives "unnecessary prominence to length of service."
At trial, the burden will be on the appellant to establish "unambiguously" that the respondent was a fixed term employee, engaged as a general labourer for the specific task of moving the purchased equipment. If the appellant fails to prove this, it will bear the burden of displacing the presumption that the respondent's prior service with 637 should be recognized in the assessment of reasonable notice. It would be the task of the trial judge to assess the reasonable notice required on a consideration of all the particular circumstances, attaching sufficient weight to the respondent's prior experience, to arrive at a remedy that is fair to both parties.
3. Yes. The motion judge erred in finding that the SRA was not relevant. While the SRA was redundant in terminating the respondent's employment with 637 (since the common law implied termination on the sale of the business), and the SRA did not preclude a claim by the respondent against the appellant (which was not a party to the SRA), the SRA was relevant in other ways. The payment made to the respondent under the SRA was relevant to determining to the length of notice period assessed against the appellant. The SRA was also part of the factual matrix and relevant to the respondent's understanding of how she would be treated on the sale of the business. The fact that the amount of the payment under the SRA was less than the notice a long-term employee might have expected could support the inference that the respondent understood she would be employed by the appellant on an indefinite basis, and that she would successfully mitigate all of the damages from her termination by 637.
[Feldman, Lauwers and Huscroft JJ.A.]
Emily Stock and Brandon Cook, for the appellant
Robert W. Dowhan and Matthew McMahon, for the respondent
Keywords: Contracts, Insurance, Standard of Review, "All Risks", Coverage, Flood, Sewer Back Up, Business Interruption, "Surface Water" Exclusion, Insurance Act, R.S.O. 1990, c. I.8, s. 128, Statutory Condition 11, Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co. , 2016 SCC 37, MacDonald v. Chicago Title Insurance Company of Canada, 2015 ONCA 842, leave to appeal refused,  S.C.C.A. No. 39, Progressive Homes Ltd. v. Lombard General Insurance Co. of Canada, 2010 SCC 33, Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, Housen v. Nikolaisen, 2002 SCC 33, Sam's Auto Wrecking Co. Ltd. (Wentworth Metal) v. Lombard General Insurance Company of Canada, 2013 ONCA 186, Pilot Insurance Co. v. Sutherland, 2007 ONCA 492, Cabell v. The Personal Insurance Company, 2011 ONCA 105, Wigle v. Allstate Insurance Co. of Canada, (1984), 49 O.R. (2d) 101 (C.A.),
On July 8, 2013, the GTA experienced a rain event unparalleled in its recorded history. Environment Canada measured in excess of 90 mm of rain in less than two hours at Pearson International Airport. The storm of July 8, 2013, also produced the highest single day rainfall total in recorded history for the GTA.
The entry of water into the banquet hall facility operated by the appellant caused significant damage. The appellant was insured under an "all-risks" policy by the respondent insurer, Co-operators General Insurance Company.
The appellant got a quotation for emergency repairs on July 19, 2013 for $46,396.32, excluding tax, which the insurer paid. The insurer then sent the appellant a quote, provided by the insurer's contractor, indicating that the full replacement cost to be paid after the repairs were completed was $105,533.94. The appellant was dissatisfied with the quote, believing it to be insufficient and so low that it would not justify shutting down the business to effect the repairs. Many months later, the insurer told the appellant that the actual cash value of the repairs was $79,150.45, which it paid.
The appellant later got a quote estimating the repair cost at $681,869.99. Because there was such a wide gap between the estimates of losses and costs, the appellant triggered the appraisal process provided under Statutory Condition 11 of the policy and s. 128 of the Insurance Act, R.S.O. 1990, c. I.8. The appraisal award set the value of the damage to the building at a replacement cost of $591,552, with an actual cash value of $561,974.40. The value of the contents/equipment loss was set at a replacement cost of $337,777.18, with an actual cash value of $253,332.89. The insurer delayed the payment of the claim under the Sewer Back Up Endorsement. The April 2014 payment brought the total amount paid to about $124,000. The insurer's next payment came five years after the loss, when it paid the remaining balance up to the $500,000 limit of the Sewer Back Up Endorsement. The insurer denied the appellant's claim for indemnity for business interruption under the Profits Endorsement Form coverage of the insurance policy because the appellant continued to operate after the rainstorm.
The appellant sued the insurer for the balance of payments it alleged were owed exceeding the $500,000 limit of the Sewer Back Up Endorsement, including for claims under the Flood Endorsement, for losses associated with business interruption, and for extra-contractual damages. The trial judge found that the Sewer Back Up Endorsement applied, and that the insurer had paid out the policy limit of $500,000 and owed nothing more. He dismissed the appellant's other claims.
Did the trial judge in in finding that the appellant was not entitled to:
- Coverage under the Flood Endorsement Form;
- coverage for business losses under the Profits Endorsement Form;
- extra-contractual damages on the basis that the insurer delayed making payments; and
- compensation for professional fees incurred to establish the quantum of the business interruption loss under the Commercial Plus Endorsement Form.
Appeal allowed in part.
The Court began by confirming that the standard of review relating to the interpretation of standard form insurance contracts is correctness. Questions of mixed fact and law are subject to the standard of palpable and overriding error, except for any extricable errors of law, which are subject to the correctness standard. The principles for interpreting insurance policies, and in particular exclusion clauses, are well-established. The principles of interpretation for insurance policies provide that the policy should be interpreted to promote a reasonable commercial result; provisions granting coverage ought to be construed broadly; provisions excluding coverage ought to be construed narrowly; in the case of ambiguity, the interpretation most favourable to the insured should be adopted; and even a clear and unambiguous clause should not be given effect if to do so would nullify the coverage provided by the policy. In addition, the court must strive to interpret the contract according to "the whole of the contract and any relevant surrounding circumstances" in a way that "promotes the true intent and reasonable expectations of the parties at the time of entry into the contract" and avoids "either a windfall to the insurer or an unanticipated recovery to the insured".
1. Yes. The influx of water into the appellant's facility was a flood within the meaning of the Flood Endorsement.
The policy's Flood Endorsement provided as follows: "For the purpose of this endorsement, flood shall mean the rising of, the breaking out or the overflow of any body of water, whether natural or man-made and includes waves, tides, tidal waves and tsunamis."
The policy's Sewer Back Up Endorsement provided as follows: "The coverage provided by this Policy is extended to include loss or damage caused directly by the backing up of sewers, sumps, septic tanks or drains subject to the following [limits]."
Under the policy, "Surface Water" means water or natural precipitation temporarily diffused over the surface of the ground.
The trial judge erred in giving any effect to the definition of "Surface Water" in the Commercial Broad Form policy when he interpreted the Flood Endorsement, for two reasons. First, the trial judge's use of the exclusion language misapprehends the relationship between the Commercial Broad Form policy and the Flood Endorsement. An endorsement is not a standalone insurance policy. It is linked to the policy to which it is attached and with which it is purchased. An endorsement "does not have an independent existence" from the policy. In other words, the policy and the endorsement must be read together.
The second reason why the trial judge erred in importing the exclusion of "Surface Water" flooding into the Flood Endorsement is that doing so would effectively nullify flood coverage, not only in this case but in almost all cases, because few buildings stand right on the edge of a body of water. The appellant's facility is on land located some distance away from water. How could the Flood Endorsement ever be engaged if it excluded a flood via surface water? The insurer effectively conceded this point, explaining: "If water breaks the banks of a body of water and then has to flow across a surface before entering a premise and causing a loss, it will still be deemed a Flood under the Policy. Surface Water is excluded from the Policy unless there is a Flood, as defined by the Policy." The Flood Endorsement should be read as entirely displacing the flood exclusion in the Commercial Broad Form policy, without giving any weight to the "Surface Water" exclusion.
The influx of water into the appellant's facility was a flood within the meaning of the Flood Endorsement for the following reasons. First, there is no question that the ordinary meaning of the word "flood" would include the massive, forceful, and fast-moving flow of water into the facility on this occasion.
Second, there was a catastrophic failure of all the water channelling features in the vicinity, both natural and man-made. Drainage channels, stormwater management facilities, ditches, and even creeks can be dry on occasion. Just before a creek or a drainage ditch overflows, it constitutes a "body of water," even though it might have been dry several hours earlier. There is no sense in which the Endorsement requires the body of water to have a permanent existence. The fact that counsel for the insurer struggled in oral argument to find a circumstance in which the Flood Endorsement would ever benefit the appellant was telling.
Finally, in construing the Flood Endorsement, the trial judge departed from the principle that provisions granting coverage ought to be construed broadly. His interpretation effectively nullified coverage for the "obvious risks" identified in the Endorsement and belied the reasonable expectations of the appellant in purchasing that coverage. He also made a palpable and overriding error in failing to find on the evidence that there was a flood within the meaning of the Flood Endorsement.
In conclusion, it was difficult to imagine a realistic scenario that would constitute a flood within the meaning of the Flood Endorsement if, on the facts, this event did not satisfy that definition.
Because the Flood Endorsement applied to the loss or damage caused by the flood, the limit of covered losses in the Sewer Back Up Endorsement no longer served to limit the appellant's claim. The available evidence on that additional loss was the appraisal award, calculated according to the process in Statutory Condition 11 in the policy and s. 128 of the Insurance Act.
2. No. The claim for business interruption losses was not made out on the evidence, as found by the trial judge. This was therefore not the case in which to definitively interpret the meaning of the expression "necessary interruption of business" in the Profits Endorsement Form. However, the Court made it clear that it did not want to be taken as necessarily agreeing with the trial judge that the expression requires a total cessation of business activity for a period of time for coverage to arise. The Court doubted the trial judge's interpretation of the Profits Endorsement Form. "Interference" with the appellant's business, rather than a complete shut-down, might have sufficed to trigger coverage.
3. No. There was no basis on which to set aside the trial judge's disposition of this issue, which rested on the dual finding that the appellant had not proven a loss of profit and revenue, and that it was the author of its own misfortune. While the delay in payment was not acceptable, the trial judge acceded to the appellant's submission that some adjustment should be made to account for the delay in the costs award to the insurer by reducing the costs award.
4. Yes. The policy provided that "in the event of loss or damage by an insured peril, the Insurer will pay reasonable fees to auditors, accountants, architects, engineers or other professionals, other than public adjusters and the Insured's own employees, for producing and certifying particulars or details of the Insured's business required by the Insurer in order to arrive at the amount of loss payable under this Policy. This extension applies only to fees incurred in establishing the quantum of a loss, liability for which is otherwise accepted by the Insurer. This extension may also apply to any Business Interruption loss covered under this Policy."
The appellant's expert was retained for the purposes of producing and certifying particulars or details of the appellant's business in order to arrive at the amount of loss payable under the policy. The fact that his fees were not submitted to the insurer by way of a proof of loss did not disentitle the appellant to recover the expert's fees.
[Benotto, Fairburn and Jamal JJ.A.]
Sarah Clarke and Cheryl Robinson, for the appellant
Daryl Gelgoot, Vanessa Amyot and Barbara Jackman, for the respondent
Sheena Scott, Caterina Tempesta and Roger Rowe, for the Office of the Children's Lawyer
Michael Bossin, Laïla Demirdache, Jacqueline Bonisteel, and Jamie Chai Yun Liew, for Amnesty International Canada
Archana Arun Medhekar, for the Barbra Schlifer Commemorative Clinic
Maureen Silcoff and Adam B. Sadinsky, for the Canadian Association of Refugee Lawyers
Lorne Waldman, Charles Steven and Sumey Mulla, for the United Nations High Commissioner for Refugees
Keywords: Family Law, Custody and Access, Child Abduction, Immigration Law, Refugee Claims, Principle of Non-Refoulement, Civil Procedure, Fresh Evidence, Children's Law Reform Act, R.S.O., 1990, c. C.12, ss. 23, 40(3), 46, Immigration and Refugee Protection Act, S.C. 2001, c. 27, ss. 96, 101(1)(c)), 115(1), Convention on the Civil Aspects of International Child Abduction, 25 October 1980, Can. T.S. 1983 No. 35 (entered into force 1 December 1983) (the "Hague Convention"), 1951 Convention relating to the Status of Refugees, July 28, 1951, 189 U.N.T.S. 150 (the "1951 Convention"), H.E. v. M.M. , 2015 ONCA 813, Ojeikere v. Ojeikere, 2018 ONCA 372, Suresh v. Canada (Minister of Citizenship and Immigration) , 2002 SCC 1, A.M.R.I. v. K.E.R., 2011 ONCA 417
The appellant is the mother of three children now ages 4, 7, and 11. Two years ago, she brought them from Kuwait to Canada without the respondent father's consent. On arrival in Canada, she sought refugee status for herself and the children. She claimed she fled an abusive relationship that put her safety and that of her children at risk of serious harm. The father denied the allegation and claimed that she wrongfully kidnapped the children.
The father applied for an order requiring that the children be returned to Kuwait. The mother asked Ontario to exercise jurisdiction to decide her custody claim. The basis for her claim was s. 23 of the Children's Law Reform Act, R.S.O., 1990, c. C.12 ("CLRA"), which, despite other jurisdictional limits, permits an Ontario court to exercise its jurisdiction to make custody and access orders where the child is physically present in Ontario and the court is satisfied on a balance of probabilities that the child would suffer serious harm if removed from Ontario.
The application judge found that Ontario did not have jurisdiction under s. 23 because there was no risk of serious harm to the children. She ordered the children returned to Kuwait. The mother appealed.
Did the application judge err in determining that the children were not at risk of serious harm, and therefore that she had no jurisdiction under s. 23 of the CLRA?
Yes. The issues are best addressed in two stages: 1. the serious harm analysis under s. 23 of the CLRA; and 2. the effect of the refugee claim on the application.
(1) Serious harm under s. 23
Under Ojeikere v. Ojeikere, 2018 ONCA 372, the determination of serious harm is based on the consideration of the following factors: (i) the risk of physical harm; (ii) the risk of psychological harm; (iii) the views of the children; and (iv) the mother's claim that she would not return to the habitual residence even if the children were required to do so.
The application judge determined that Ontario could not exercise jurisdiction to make custody and access orders because she was not satisfied on a balance of probabilities that the children would suffer serious harm if returned to Kuwait. In coming to this conclusion, she discounted the children's evidence on the basis that it was the product of the mother's inappropriate influence. She made this assessment in the face of uncontradicted evidence from three separate OCL experts that the children's views were in fact independent. She did not explain why this expert evidence should be rejected. This was an error.
The right of children to participate in matters involving them is fundamental to family law proceedings. Canada has adopted the Convention on the Rights of the Child, effectively guaranteeing that their views will be heard. A determination of best interests – which is engaged in all child-related matters – must incorporate the child's view.
While it was open to her to reject the mother's testimony and conclude that the mother may have tried to influence the children's views, to reject the three experts' evidence that the children's views were actually independent and free from influence required explanation. Absent any explanation as to why the application judge did not accept the three experts, her conclusion could not stand.
All of the Ojeikere factors were present here. There was a risk of physical and psychological harm, the children's views were clear and – considering the new evidence including the "obedience order" issued by the Kuwaiti court – the mother could not realistically return to Kuwait. She had been the primary caregiver since birth and the children would likely lose their primary caregiver if forced to return to Kuwait. The father's statement that he would not enforce the custody order or the obedience order offered little reassurance. On the evidence, the Court was satisfied on the balance of probabilities that the children would suffer serious harm if returned to Kuwait. The Ontario court may therefore exercise its jurisdiction to make custody and access orders for these children.
(2) Effect of the refugee claim on the application
The principle of non-refoulement forbids a country from returning an asylum seeker to a country in which they would likely be in danger of persecution. This principle has been considered the cornerstone of international refugee protection. Canada has implemented the principle of non-refoulement in s. 115(1) of the Immigration and Refugee Protection Act.
The principle of non-refoulement applies not only to recognized refugees, but also to asylum seekers whose status has not yet been determined. Refugee protection is not limited to those granted refugee status but applies equally to asylum seekers. If, under the CLRA, a child is ordered returned to a place from which asylum is sought, the child's rights to asylum are lost. A person is not permitted to continue a refugee claim once in their home country. Nor is the person entitled to make a second claim should the person return to Canada.
Children are entitled to protection as they seek asylum. The application judge erred by ordering their return under s. 40(3) of the CLRA before the determination of the refugee claim.
The Court disagreed with the OCL's submissions (and the mother's alternate submission) that the entire application, including the mother's request that Ontario exercise its jurisdiction to make custody and access orders for the children under s. 23 of the CLRA, should have been adjourned pending the refugee determination. The Court gave three reasons.
First, it is the s. 40(3) return order that would engage the non-refoulement principles, not the s. 23 analysis. Section 40(3) empowers the court to make a return order in extra-provincial matters. Section 40 confers broad powers on the court and unlike the terms of the Hague Convention, does not require a return of the child to his or her habitual residence absent engagement of the harm exception. A return order must not be made under s. 40(3) in the face of a pending refugee claim. The Court left to another day how the court should proceed if a return order to a signatory country was sought under the Convention in the face of a pending refugee claim.
Second, the OCL submitted that the serious harm analysis in s. 23 should not proceed until the refugee determination is made because it is only after a positive refugee determination that the children would have the benefit of a rebuttable presumption of the risk of harm. Refugee status gives rise to a rebuttable presumption of a grave risk of harm on return to the child's habitual residence. It defies common sense to require children to await a refugee determination because the case for serious harm may get stronger. If the court is satisfied as to serious harm, it may exercise jurisdiction under s. 23 and proceed to make custody and access orders for the children even before the refugee determination. The Court did not share the OCL's concern that in the face of a pending refugee claim a court might, as here, conclude that it was not satisfied as to serious harm under s. 23 and the rebuttable presumption would be lost. When the issue is potential harm to children, the courts must always be guided by the children's best interests. If a rebuttable presumption of harm arises from a refugee determination following an adverse s. 23 finding, the court would be required to revisit the s. 23 determination using the rebuttable presumption flowing from the child's new status as a refugee. Under s. 23, the court must be satisfied that the child would, on the balance of probabilities, suffer serious harm. When the child becomes a refugee, there is a fundamental shift in the court's approach by introducing a rebuttable presumption that the child would with some certainty suffer serious harm. Introducing a rebuttable presumption means the court must consider harm differently for the purpose of s. 23. When a request is made for the court to exercise jurisdiction under s. 23 in the face of a pending refugee claim, but the court is not satisfied that the serious harm requirement has been met, the court may want to consider exercising its power under s. 40(2) to stay the proceedings until the refugee claim is determined. However, even when the court concludes that the s. 23 test was not previously met, it will always be required to revisit the s. 23 analysis in light of the refugee determination and through the lens of the rebuttable presumption of harm. Most importantly, the return order under s. 40 could not be made before the refugee claim is resolved.
Finally, the best interests of the child require that when the court is satisfied as to serious harm under s. 23, there be no further delay in making custody and access orders. This case demonstrated why. The new evidence described that the children were anxious, exhibited physical symptoms, and were unsure of their immediate future. A delay was not in their best interests.
The matter was remitted to a new custody and access hearing before the Superior Court.
[Huscroft, Zarnett and Coroza JJ.A.]
Glenroy Bastien, for the appellants
Sean Dewart & Mathieu Bélanger, for the respondents
Keywords: Torts, Solicitor's Negligence, Ineffective Assistance of Counsel, Civil Procedure, Striking Pleadings, Abuse of Process, Res Judicata, Issue Estoppel, Collateral Attack, Summary Judgment, Rules of Civil Procedure, Rules 20.04(2.2), 21, R. v. Archer (2005), 202 C.C.C. (3d) 60 (C.A.), Harris v. Levine, 2014 ONCA 608, leave to appeal ref'd,  S.C.C.A. No. 467, Penner v. Niagara (Regional Police Services Board) , 2013 SCC 19, Toronto (City) v. C.U.P.E. , Local 79, 2003 SCC 63, Folland v. Reardon (2005), 74 O.R. (3d) 688 (C.A.), Hryniak v. Mauldin, 2014 SCC 7
The appellants were convicted of securities-related offences and were issued lifetime trading bans by the OSC. They were also ordered to disgorge certain amounts and to pay penalties and costs. The respondent, IS represented them as counsel before the OSC. The respondent, SF, had referred the appellants to IS.
On appeal from their convictions, the appellants argued ineffective assistance of counsel. The appeals from their convictions were dismissed by the Divisional Court. The respondents were granted intervenor status on the appeal and provided evidence to refute the appellants' contentions about ineffective representation. The Divisional Court determined that the appellants had not established that any miscarriage of justice had occurred in the OSC proceedings.
Following the dismissal of their appeals, the appellants sued the respondents for negligence, maintaining that they had lost an opportunity to settle with the OSC without a finding of fraud and limiting fines, and that they had lost potential defences and a fair hearing before the OSC.
On a rule 20 and 21 motion, the motion judge ordered a mini-trial on the issue of whether IS' advice to the appellants on settlement fell below the standard of care. The remaining claims were dismissed because the motion judge found that they were collateral attacks on the OSC decision, a decision that was upheld on appeal after the Divisional Court, which had considered the appellants' allegations of conflicts of interest and other matters they claimed amounted to ineffective representation by counsel. The motion judge held that the appellants were precluded by the doctrine of issue estoppel from advancing claims that the conduct of their lawyer had caused them to lose a hearing they deserved to win.
Did the motion judge err in dismissing the bulk of the claims against the solicitors?
No. A solicitor's negligence claim that depends, for its success, on showing that the client would have been acquitted of a criminal charge but for the lawyer's negligence, involves a collateral attack on the criminal adjudicative process, and is thus an abuse of process. Abuse of process is a discretionary doctrine. Although the motion judge did not expressly refer to his discretion, the Court did not agree that the motion judge overlooked its existence.
A person who is concerned that ineffective representation by counsel has led to a wrongful conviction must pursue that issue by way of appeal from the conviction. When that has not been done, or when, as here, it is done unsuccessfully, the result is the same. The decision that cannot be collaterally attacked in a civil proceeding is the correctness of the conviction. A civil claim that depends on showing that the conviction would not have occurred but for the lawyer's conduct is exactly that kind of improper collateral attack.
SHORT CIVIL DECISIONS
R. Brendan Bissell and Joël Turgeon, for the moving party, the Receiver, Crowe Soberman Inc.
David T. Ullmann, for the responding party, Donald Dal Bianco
Harold Rosenberger, for Deep Foundations Contractors Inc.
Edward L. D'Agostino, for Kieswetter Excavating Inc.
Jeffrey A. Armel, for the responding party, EXP Services Inc.
Eric Gionet, for the responding party, Maxion Management Services Inc.
Originally published 04 August, 2020
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