Civil Law

COURT OF APPEAL SUMMARIES (FEBRUARY 28, 2022 – MARCH 4, 2022)

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Good afternoon.

Following are this week’s summaries of the civil decisions of the Court of Appeal for Ontario for the week of February 28, 2022.

In Gefen Estate v. Gefen, an estates case, the Court reiterated that while the quality of evidence may vary depending on a claim, the civil standard of proof will always remain the same: proof on a balance of probabilities. The issues canvassed in the decision included secret trusts and the little-used doctrine of unconscionable procurement.

In The Catalyst Capital Group Inc. v. Dundee Kilmer Developments Limited Partnership, the Court upheld the motion judge’s order striking the plaintiff’s claim against the Crown of for misfeasance in public office in relation to the construction of the athlete’s village for the 2015 Pan-Am Games. Bad faith is a necessary element of the torst, and the pleadings did not provide the necessary factual underpinning to make out the bad faith requirement.

In Urbancorp Toronto Management Inc. (Re), the Court confirmed the factors that should be considered when granting leave for appeal in a CCAA case are the following: (a) whether the proposed is prima facie meritorious or frivolous; (b) whether the points on the proposed appeal are of significance to the practice; (c) whether the points on the proposed appeal are of significance to the action; and (d) whether the proposed appeal will unduly hinder the progress of the action.

Other topics covered included MVA/municipal liability, rent determination for a commercial lease, intervenors in a statutory accident benefits/administrative law case, the enforcement of settlements and striking pleadings for lack of jurisdiction.

Wishing everyone an enjoyable weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Civil Decisions

Yatar v. TD Insurance Meloche Monnex, 2022 ONCA 173

Keywords: Torts, MVA, Statutory Accident Benefits, Administrative Law, Civil Procedure, Interveners, Judicial Review Procedure Act, R.S.O. 1990, c. J.1., Statutory Accident Benefits Schedule – Accidents on or After November 1, 1996, O. Reg. 403/96, Licence Appeal Tribunal Act, 1999, S.O. 1999, c. 12, Insurance Act, R.S.O. 1990, c. I.8 Yatar v. TD Insurance Meloche Monnex, 2021 ONSC 2507, Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, 441 D.L.R. (4th), Tomec v. Economical Mutual Insurance Company, 2019 ONCA 882

The Catalyst Capital Group Inc. v. Dundee Kilmer Developments Limited Partnership, 2022 ONCA 168

Keywords: Torts, Crown Liability, Misfeasance in Public Office, Civil Procedure, Striking Pleadings, No Reasonable Cause of Action, Crown Liability and Proceedings Act, 2019, S.O. 2019, c. 7, Rules of Civil Procedure, Rule 21, The Catalyst Capital Group Inc. v. Dundee Kilmer Developments Limited Partnership, 2020 ONCA 272, R. v. Ron Engineering & Construction (Eastern) Ltd., [1981] 1 S.C.R. 111, CUPE v. HMQ, 2017 ONSC 4874, Nash v. Ontario (1995), 27 O.R. (3d) 1 (C.A.), L. (A.) v. Ontario (Minister of Community and Social Services) (2006), 218 O.A.C. 150 (C.A.), Odhavji Estate v. Woodhouse, 2003 SCC 69, Pikangikum First Nation v. Nault, 2012 ONCA 705, Trillium Power Wind Corporation v. Ontario (Natural Resources), 2013 ONCA 683, Granite Power Corp. v. Ontario (2004), 72 O.R. (3d) 194 (C.A.), Gratton-Masuy Environmental Technologies Inc. v. Ontario, 2010 ONCA 501

2501306 Ontario Inc. v. Country Garden Academy Inc., 2022 ONCA 177

Keywords: Contracts, Interpretation, Real Property, Commercial Leases, Rent Determination

1504641 Ontario Inc. v. 2225902 Ontario Inc., 2022 ONCA 175

Keywords: Civil Procedure, Settlements, Enforcement, Summary Judgment, Rules of Civil Procedure, Rules 20 & 49

Yang v. Co-operators General Insurance Company , 2022 ONCA 178

Keywords: Torts, Conspiracy, MVA, Statutory Accident Benefits, Civil Procedure, Striking Pleadings, Jurisdiction, Frivolous, Vexatious, Abuse of Process, Insurance Act, R.S.O. 1990, c. I.8, s. 280, Statutory Accident Benefits Schedule, O. Reg. 34/10 under the Insurance Act, Rules of Civil Procedure, Rules 21.01(1)(b) and 25.11, Stegenga v. Economical Mutual Insurance Co., 2019 ONCA 615, Mader v. South Easthope Mutual Insurance Company, 2014 ONCA 714, Dorman v. Economical Mutual Insurance Company, 2021 ONCA 314, Lowe v. Guarantee Co. of North America (2005), 80 O.R. (3d) 222 (C.A.)

Gefen Estate v. Gefen, 2022 ONCA 174

Keywords: Wills and Estates, Secret Trusts, Contracts, Mutual Wills Agreements, Property, Joint Tenancies, Severance, Inter Vivos Transfers, Unconscionable Procurement, Civil Procedure, Evidence, Burden of Proof, Edell v. Sitzer (2001), 55 O.R. (3d) 198 (S.C.), aff’d 9 E.T.R. (3d) 1 (Ont. C.A.), leave to appeal refused, [2004] S.C.C.A. No. 372, Bellinger v. Nuytten Estate, 2002 BCSC 571, 45 E.T.R. (2d) 10, Canada (Attorney General) v. Fairmont Hotels Inc., 2016 SCC 56, F.H. v. McDougall, 2008 SCC 53, Nelson (City) v. Mowatt, 2017 SCC 8, Canada (Attorney General) v. Fairmont Hotels Inc., 2016 SCC 56, Champoise v. Prost, 2000 BCCA 426, 77 B.C.L.R. (3d) 228, Re Snowden, [1979], Milsom v. Holien, 2001 BCSC 868, 40 E.T.R. (2d) 77, Hansen Estate v. Hansen, 2012 ONCA 112, Marley v. Salga, 2020 ONCA 104, Jansen v. Niels Estate, 2017 ONCA 312, Albert H. Oosterhoff et al., Oosterhoff on Wills, 9th ed. (Toronto: Thomson Reuters, 2021), A.H. Oosterhoff, Robert Chambers & Mitchell McInnes, Oosterhoff on Trusts: Text, Commentary and Materials, 8th ed., (Toronto: Carswell, 2014)

Urbancorp Toronto Management Inc. (Re), 2022 ONCA 181

Keywords: Bankruptcy and Insolvency, Distribution Orders, Anti-Deprivation Rule, Civil Procedure, Leave to Appeal, Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36, Stelco Inc. (Re) (2005), 75 O.R. (3d) 5 (C.A.), Nortel Networks Corporation (Re), 2016 ONCA 332, Timminco Limited (Re), 2012 ONCA 552, 2 C.B.R. (6th) 332, DEL Equipment Inc. (Re), 2020 ONCA 555, Watson v. Mason (1876), 22 Gr. 574 (Ont. C.A.), Hobbs v. The Ontario Loan and Debenture Co., (1890) 18 S.C.R. 483, Canadian Imperial Bank of Commerce v. Bramalea Inc. (1995), 33 O.R. (3d) 692 (Gen. Div.), Canada v. Canada North Group Inc., 2021 SCC 30, 460 D.L.R. (4th) 309, Grant Forest Products Inc. v. The Toronto-Dominion Bank, 2015 ONCA 570, Laurentian University of Sudbury (Re), 2021 ONCA 199, 9354-9186 Québec inc. v. Callidus Capital Corp., 2020 SCC 10

Stamatopoulos v. Harris, 2022 ONCA 179

Keywords: Torts, Negligence, MVA, Municipal Liability, Road Repair, Causation, Statutory Defences, Contributory Negligence, Municipal Act, 2001, S.O. 2001, c. 25, s. 44, Fordham v Dutton-Dunwich (Municipality), 2014 ONCA 891

Short Civil Decisions

Victor Ages Vallance LLP v. OZ Optics Ltd., 2022 ONCA 169

Keywords: Contracts, Solicitor and Client, Assessment of Accounts, Jurisdiction, Reasonable Apprehension of Bias, Cohen v. Kealey & Blaney (1985), 26 C.P.C. (2d) 211 (Ont. C.A.), Rabbani v. Niagara (Regional Municipality), 2012 ONCA 280

IT Haven Inc. v. Certain Underwriters at Lloyd’s, London (Costs), 2022 ONCA 189

Keywords: Civil Procedure, Costs

CIVIL DECISIONS

Yatar v. TD Insurance Meloche Monnex, 2022 ONCA 173

[Strathy C.J.O. (Motions Judge)]

Counsel:

J.V. Allen, for the appellant

D. R. Greenside, for the respondent TD Insurance Meloche Monnex

V. Crystal and T. Guy, for the respondent Licence Appeal Tribunal

N. F. Qureshi and A. Bakshi, for the proposed intervener Income Security Advocacy Centre (M53036)

F. Longo and G. Antman, for the proposed intervener Ontario Trial Lawyers Association (M53066)

R. Hardy, for the proposed intervener Advocacy Centre for Tenants Ontario (M53084)

C. P. Thompson, for the intervener the Attorney General of Ontario

facts:

The proceeding involved an appeal, with leave from the Ontario Court of Appeal, from the decision of the Divisional Court. The moving parties sought leave to intervene in the appeal. The Attorney General requested and was granted, leave to intervene pursuant to Judicial Review Procedure Act. On January 12, 2022, Advocacy Centre for Tenants Ontario (ACTO) was granted leave to intervene and a motion for leave to intervene by Ontario Trial Lawyers Association (OTLA) was dismissed. A motion for leave to intervene by Income Security Advocacy Centre (ISAC) was granted.

The underlying claim was by Ms. Y for statutory accident benefits under the Statutory Accident Benefits Schedule- Accidents on or After November 1, 1996. Her claim was rejected by the insurer and her benefits were terminated. After a failed mediation, she brought her claim before a Licence Appeal Tribunal (“LAT”) adjudicator. The adjudicator found that Ms. Y’s claim was time-barred. The same adjudicator dismissed her request for reconsideration.

Ms. Y appealed to the Divisional Court. She also brought an application for judicial review. As the Divisional Court explained, it has jurisdiction to hear a statutory appeal on a question of law and preserve the right of judicial review, notwithstanding any right of appeal. The Divisional Court dismissed Ms. Y’s appeal, finding that there was no error of law. The Divisional Court also dismissed the application for judicial review. It noted that judicial review is a discretionary remedy and it set out certain factors that it had been considering in deciding whether to exercise its discretion to hear a judicial review of an application from a LAT SABS decision where there is no error of law.

ATCO is a legal clinic, devoted to advocacy in a number of forums concerning housing issues. It moved for intervener status because of the concern about the impact of the Divisional Court’s decision on the ability of tenants to seek judicial review in the face of a limited right of appeal on a question of law under s. 210 of the Residential Tenancies Act, 2006, S.O. 2006.

ISAC is a specialized legal clinic focused on advocacy related to income security, with an emphasis on social assistance and other government programs aimed at addressing poverty. Its interest in the issue on appeal is the fact that social benefits legislation generally contains only a limited statutory right of appeal.

OTLA is involved in advocacy on behalf of accident victims, among others. It submits it has “specialized knowledge and experience with accident benefits legislation and litigating accident benefit disputes on behalf of injured Ontarians.”

issues:

Should the moving parties be granted leave to intervene?

holding:

Motions of ACTO and ISAC granted. OTLA’s motion dismissed.

reasoning:

In granting leave to intervene, the court looks at the nature of the case, the issues that arise and the likelihood that the proposed intervener will be able to make a useful contribution to the resolution of the appeal without injustice to the immediate parties. Part of that assessment examines the experience and perspective the proposed intervener would bring to the table at the hearing of the appeal. The court also looks to whether granting leave to intervene would cause hardship or prejudice to the parties to the appeal. One concern, particularly in a case like this, which at its core is a civil dispute, is to ensure that the intervener(s) do not overwhelm the appeal, or “pile on” one of the parties.

There can be no serious dispute that each of ACTO, ISAC and OTLA are qualified to act as an intervener in a case of this kind. They are all well recognized organizations, with special expertise and an identifiable interest in the subject-matter of these proceedings. The issue raised on the appeal – the scope of judicial review in the context of a statutory right of appeal – is an important question of law that has implications well beyond the immediate parties to the appeal. This case, therefore, is well along the continuum between constitutional litigation on the one end, and a purely private dispute at the other end. The implications of the decision to other statutory schemes make this the kind of case in which the court would benefit from the perspectives offered by interveners.

Both ACTO and ISAC would bring a unique perspective to the appeal – a perspective that differs from the appellant’s but is not inconsistent with it. On the other hand, OTLA’s submissions were largely duplicative of the submissions of the appellant on the appeal. Granting leave to intervene to a third intervener would be unfair to the respondent in this case and unnecessary for the assistance of the court.

The Catalyst Capital Group Inc. v. Dundee Kilmer Developments Limited Partnership, 2022 ONCA 168

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

Counsel:

D. Moore and K. Jones, for the appellant

C. Thompson and M. Ion, for the respondent

facts:

The action relates to Catalyst’s participation in the development of the Pan Am Athletes’ Village Project for the 2015 Pan-Am Games in Toronto. Catalyst claims that it entered into contracts to provide a novel financial model to the Dundee Kilmer defendants (“DKD”). In turn, DKD used that model and certain financings provided by Catalyst to secure their selection by Infrastructure Ontario (“IO”), a Crown corporation, as the successful bidder for the construction of the Athletes’ Village.

Catalyst claimed that HMQ directed IO not to exercise its discretion to allow Catalyst to be added as a proponent team member. The first claim was struck on the basis that it did not comply with the rule requiring causes of action to be properly and intelligibly pleaded. The second was struck as against HMQ but with leave to amend the claim for misfeasance in public office. That amended claim was the subject of the present appeal by Catalyst.

issues:

(1) Did the motion judge err by misapplying his prior decision in CUPE v. HMQ, 2017 ONSC 4874 to the case before him?

(2) Did the motion judge err by failing to follow the principles of law that apply to claims of misfeasance in public office?

(3) Did the motion judge err by treating the claim as being akin to a tender case?

(4) Did the motion judge err by concluding that the amended pleading contained bald allegations?

(5) Did the motion judge err by holding that the Crown Liability and Proceedings Act applied to the claim?

holding:

Appeal dismissed.

reasoning:

(1) No.

The motion judge did not misapply the decision in CUPE. This case was referenced simply for the principle that “care must be taken to focus on the material facts pleaded and avoid giving undue weight to conclusory statements or descriptive characterizations. A bald assertion that a public official acted unlawfully and in bad faith must be accompanied by pleadings of material facts which plausibly support such a conclusion.”
After reviewing the jurisprudence, the motion judge determined that the central issue to be decided was the sufficiency of the pleadings and, specifically, whether they were capable of supporting the bad faith component of the tort. The motion judge properly analysed the pleading according to the appropriate principles.

(2) No.

The elements of the misfeasance tort were set out by the Supreme Court of Canada. The SCC explained that the tort of misfeasance in public office can arise in one of two ways. Category A involves conduct that is specifically intended to injure a person or a class of persons. Category B involves a public officer who acts with knowledge both that she or he has no power to do the act complained of and that the act is likely to injure the plaintiff. The SCC further explained that the requirement that the defendant must have been aware that his or her conduct was unlawful reflects the well-established principle that misfeasance in public office requires an element of “bad faith” or “dishonesty”. The fact that a public official makes a decision that harms a member of the public is not, in and of itself, a basis to infer bad faith.

The motion judge did not err in concluding that the second amended statement of claim did not effectively plead the required element of bad faith or unlawful conduct. That is, the pleadings do not provide the necessary factual underpinning to make out the tort of misfeasance in public office against HMQ. The material facts contained in the pleadings, if accepted as they must on a Rule 21 motion, certainly support the claim that HMQ knew that its decision not to consent to Catalyst’s inclusion in the project would harm Catalyst. However, neither HMQ’s decision to specifically exclude Catalyst from the project, nor its knowledge of the potential harm this decision would cause, are enough to ground the tort of misfeasance in public office. Absent bad faith, such conduct is not inconsistent with the office of a public actor. Further, while the Court acknowledged that various paragraphs of pleadings also alleged that HMQ “deliberately caused harm to Catalyst, targeted Catalyst” and that HMQ’s conduct was “unreasonable, arbitrary, deliberate, unlawful” and “in bad faith”, these allegations were not supported by the facts as pleaded.

(3) No.

(4) No.

The Court determined that the suggestion that HMQ knew that it was relying on incorrect information for the alleged instructions and directions, and nonetheless acted on it in bad faith, was simply a bald allegation. No material facts were pleaded that plausibly supported this claim nor explained why one would look beyond the reasons that HMQ gave for its decision. Moreover, Catalyst pleaded that, in excluding it from participating in the project, HMQ “intentionally disregarded and undermined” certain Governmental Representations. However, other than the bald allegation that the alleged “actions, decisions, directions and instructions were for unlawful and improper purposes,” the second amended statement of claim offered no material facts to support the suggestion that HMQ “deliberately engaged in conduct that [it] knows to be inconsistent with the obligations of the office”.

(5)

The Court did not address this ground of appeal, but noted that this should not be taken as an indication that it agreed with the motion judge’s findings on the issue.

2501306 Ontario Inc. v. Country Garden Academy Inc., 2022 ONCA 177

[Simmons, Harvison Young and Zarnett JJ.A.]

Counsel:

G. L. Adrian, for the appellant

S. Erskine, for the respondent

Keywords: Contracts, Interpretation, Real Property, Commercial Leases, Rent Determination

facts:

The appellant operates a school in premises it rents from the respondent. On March 31, 2020, the appellant exercised its option to renew its lease for a third three-year term. Under the terms of the lease, the Minimum Rent during any renewal was to be negotiated 90 days before the renewal term and “be based on the prevailing market rates at the time of renewal for comparable premises.” The parties were unable to agree on the Minimum Rent, and the respondent applied under rule 14.05 for a declaration that the Minimum Rent payable would be $ 23 per square foot per year. The respondent was not the landlord when the lease was first negotiated.

Both parties filed expert evidence as to the market rate that should be apply during the third renewal term. The appellant’s expert filed two reports. The first June 2020 report estimated the market rate at $ 14 to $ 16 per square foot. The second November 27, 2020 report estimated the market rate at $ 12 to 14 per square foot. The respondent’s expert concluded that the market rate as of August 5, 2020 ranged from $ 20 to $ 25 per square foot and provided a best estimate of $ 23 per square foot.

Based on the comparables put forward by both experts and the other evidence adduced on the application, the application judge concluded that the Minimum Rent for the renewal period should be $ 18 per square foot.

issues:

(1) Did the application judge err in law by failing to interpret the term “comparable premises” in a manner consistent with how the appellant and the original landlord previously interpreted that term?

(2) Did the application judge err in law by failing to consider the very limited uses allowed by the property’s zoning?

(3) Did the application judge make a palpable and overriding error by failing to consider evidence of bad faith/wrongful conduct on the part of the respondent, demonstrating the respondent was motivated to force the appellant from the property by way of extortive pricing so he could have it for his own use?

holding:

Appeal dismissed.

reasoning:

(1) No.

The limited evidence adduced by the appellant concerning prior comparables was not capable of supporting the appellant’s submission. The only evidence was two paragraphs in an affidavit filed on the appellant’s behalf by D. H. D. H. asserted that he and the principal of the original landlord came to an agreement on the original rental rate based on similar properties in the area. None of the similar properties used as comparables in the past were identified. There was no evidence of the rental rates for those properties at the time of the renewal in issue.

(2) No.

The application judge described the permitted uses in his reasons and noted specifically that a downward adjustment from certain comparables would be required for a remotely located property with limited uses.

(3) No.

There was no evidence that the evidence of the respondent’s expert was in any way influenced or tainted by alleged wrongful conduct or improper motivations on the part of the respondent. The application judge’s decision concerning the Minimum Rent for the renewal period was based on evidence concerning the terms of the lease, the nature of the property, and expert evidence concerning prevailing market rates for comparable premises.

1504641 Ontario Inc. v. 2225902 Ontario Inc., 2022 ONCA 175

[Simmons, Harvison Young and Zarnett JJ.A.]

Counsel:

R. Sawhney, for the appellants

G. L. Adrian, for the respondent 1504641 Ontario Inc.

Keywords: Civil Procedure, Settlements, Enforcement, Summary Judgment, Rules of Civil Procedure, Rules 20 & 49

facts:

In February 2020, shortly before the onset of the Covid-19 pandemic, the parties entered into Minutes of Settlement requiring, among other things, that: the appellants pay to the respondents $ 40,000 in four monthly instalments of $ 10,000 each between March 2 and June 2, 2020; the appellants deliver a consent to judgment in the amount of $ 120,000 to be held in escrow pending completion of their instalment payments at which time the consent would be returned to their counsel; the appellants deliver a consent to the dismissal of the action without costs to be held in escrow by counsel for two other defendants (the “other settling parties”) pending the appellants’ paying their instalment payments; and the parties exchange releases.

The appellants failed to deliver the required consents and stopped payment on their last $ 10,000 instalment. The appellants failure to deliver the consents led to a delay in payment of a lump sum required to be paid by the other settling parties to the respondents under the Minutes of Settlement. Following that payment, the respondents and the other settling parties arranged separately for the dismissal of the action against the other settling parties.

On a motion brought by the respondents against the appellants pursuant to rule 49.09 to enforce the Minutes of Settlement, the motion judge converted the motion to a rule 20 motion and granted judgment to the respondents for $ 90,000 (being the $ 120,000 amount referred to in the Minutes of Settlement less the three instalments paid). The motion judge rejected the appellants’ claims that the pandemic, or the respondents’ arrangements with the other settling parties, should in any way alter the appellants’ obligations under the Minutes of Settlement.

issues:

Did the motion judge err in dealing with the respondents’ motion as an in-writing motion; in converting it to a summary judgment motion; or in granting summary judgment to the respondents for $ 90,000?

holding:

Appeal dismissed.

reasoning:

No.

The parties requested the motion judge to deal with the motion as an in-writing motion. She was entitled to treat the motion as a motion for judgment as both parties had fully addressed in their material the enforceability of the Minutes of Settlement: rule 37.13(2).

The Court also agreed with the motion judge’s conclusions that neither the pandemic nor the appellants’ arrangements with the other settling parties altered the appellants’ obligations under the Minutes of Settlement.

The respondents were obliged to make other arrangements to dismiss the action against the other settling defendants because of the appellants’ failure to deliver the consent to the dismissal of the action as required under the Minutes of Settlement. The respondents could not rely on their own default to establish non-compliance or waiver by the respondents.

The Court did not accept the appellant’s position that they were entitled to withhold payment of their final $ 10,000 instalment because the respondents were threatening to continue the action against them even if the final instalment owing under the Minutes of Settlement was paid.

The Minutes of Settlement required that the consent to judgment be returned to appellants’ counsel once the appellants had paid the required instalments. The appellants were not at risk of having a judgment for $ 90,000 entered against them provided they paid their final instalment. It was the appellants’ failure to deliver the required consents that led to the possibility of the respondents seeking some additional form of relief. The appellants were not entitled to rely on their own default to justify withholding the final instalment.

The Court did not accept the appellant’s argument that the $ 90,000 award amounted to a penalty. The parties entered into Minutes of Settlement as a compromise to avoid a trial. As part of that compromise, the respondents agreed to reduce their claim to finally resolve the matter without additional costs if the reduced amount was paid in a timely way. In these circumstances, the amount required to be paid under the consent to judgment in the event that all of the instalment payments were not made was not a penalty.

Yang v. Co-operators General Insurance Company, 2022 ONCA 178

[Lauwers, Huscroft and Coroza JJ.A.]

Counsel:

P. Bates, P. Murray and A. Ismail, for the appellant

R. Akazaki, for the respondents, SCM Insurance Services Inc. (a.k.a. Cira Medical Services Inc.), SCM Insurance Services GP Inc., Cira Health Solutions LP, Dr. Orner, and A. Ang

Keywords:Torts, Conspiracy, MVA, Statutory Accident Benefits, Civil Procedure, Striking Pleadings, Jurisdiction, Frivolous, Vexatious, Abuse of Process, Insurance Act, R.S.O. 1990, c. I.8, s. 280, Statutory Accident Benefits Schedule, O. Reg. 34/10 under the Insurance Act, Rules of Civil Procedure, Rules 21.01(1)(b) and 25.11, Stegenga v. Economical Mutual Insurance Co., 2019 ONCA 615, Mader v. South Easthope Mutual Insurance Company, 2014 ONCA 714, Dorman v. Economical Mutual Insurance Company, 2021 ONCA 314, Lowe v. Guarantee Co. of North America (2005), 80 O.R. (3d) 222 (C.A.)

facts:

The appellant alleged that her insurer coerced the respondent health care practitioners into “staging” multiple examinations under s. 44 of the Schedule and preparing false reports and that the other respondents were complicit in that conspiracy. As part of this conspiracy, she alleged that her insurer, the assessors, and SmartSimple Software Inc. breached her privacy and withheld or destroyed relevant documents.

The motion judge dismissed the appellant’s action because the Superior Court lacked jurisdiction over the subject-matter. He also held that the appellant’s asserted causes of action had no chance of success and that her pleadings were so frivolous, scandalous, and vexatious that they should be struck without leave to amend under Rule 25.11 of the Rules of Civil Procedure.

issues:

Did the motion judge err in holding that the Superior Court lacked jurisdiction over the subject-matter of her claim and that in striking her pleadings under both Rules 21.01(1)(b) and 25.11?

holding:

Appeal dismissed.

reasoning:

No.

Section 280 of the Insurance Act, which grants the Licence Appeal Tribunal exclusive jurisdiction over disputes in respect of statutory accident benefits. To that extent, s. 280(3) also deprives the Superior Court of jurisdiction.

The statement of claim alleged many causes of action, as the motion judge noted the crux of the appellant’s complaints was a dispute about how her insurer (Co-operators) handled her claims under the Statutory Accident Benefits Schedule (that is, the efforts to circumvent the Schedule).

Now that the appellant had settled with her insurer and its employees, she submitted that s. 280 was not a bar to her claim because the Licence Appeal Tribunal was empowered only to adjudicate disputes between an insured and an insurer. The appellant relied on the language of s. 280, as well as Dorman v. Economical Mutual Insurance Company, 2021 ONCA 314. The claim in Dorman that was not statute-barred by s. 280 was a class action for systemic negligence against the Financial Services Commission of Ontario (“FSCO”). The allegations against FSCO were that it had failed to investigate complaints against insurers and failed to enforce its own guidelines. In contrast, in this case, the appellant’s claims concerned the way in which she was assessed for statutory accident benefits under s. 44 of the Schedule. That was squarely within the Licence Appeal Tribunal’s mandate.

Lastly, the appellant chose to settle with her insurer. The fact that she cannot now independently seek damages against each of the other parties did not oust the Tribunal’s jurisdiction over the subject-matter of the claim.

Gefen Estate v. Gefen, 2022 ONCA 174

[Pepall, Tulloch and Roberts JJ.A.]

Counsel:

L. Tupman and A. Bloom, for the appellant S2

R. Moldaver, for the respondents H.G., S1 and A.G.

C. Graham, for the respondent Lucia Saunders, as Estate Trustee of the Estate of S3

facts:

E.G. and H.G. were married for 65 years. They had three sons: S1, S2, and S3.

E.G. and H.G. had mirror wills. When E.G. died on October 28, 2011, his estate passed absolutely to H.G., and she was named his sole executor. Two months prior to his death, E.G. signed a document. S2 and S3 claimed that the document evidenced a secret trust and a mutual wills agreement between E.G. and H.G. that operated to divide E.G.’s Estate into equal shares for the three sons on H.G.’s death.

H.G. did not feel that S2 and S3 should receive any of E.G.’s money. Between 2011 and 2016, she made various inter vivos gifts to S1.

On May 6, 2016, S3 died, leaving no issue. Accordingly, S3’s partner and Estate Trustee, L.M.S., represented S3’s Estate in the litigation.

In 2018 and 2019, the parties went to trial. S2 and S3’s Estate sought a proportionate one-third share of the collective wealth and assets accumulated by E.G. and H.G. over their lifetimes, all of which was held by H.G. following E.G.’ death in 2011.

By the time of trial, H.G. had transferred a significant portion of this wealth to S1 and his daughter, A.G., and H.G.’s net worth had depleted by at least 50%. H.G. also had purported indebtedness and granted security over all her remaining assets in favour of S1 and his family. E.G. and H.G.’s assets were comprised of cash, cash equivalents and holdings in commercial real estate. The couple’s assets also included a joint tenancy in a condominium at 11 Townsgate Drive (“Townsgate”). In October 2010, E.G. and H.G. transferred Townsgate into their joint names and that of S3. When E.G. died, H.G. and S3 held the property as joint tenants. When S3 died, H.G. commenced a survivorship application and questions arose as to whether S3’s joint tenancy had been severed prior to his death.

The trial judge was not satisfied on a balance of probabilities of the existence of a mutual wills agreement. The evidence of any such agreement was not “clear, cogent and non-speculative”. Rather, she found that “the evidence against the existence of a [mutual wills agreement] overwhelms any evidence (or suggested inferences) in favour of it.” The trial judge also dismissed S2 and the S3 Estate’s claim that a secret trust was created. The document only spoke to E.G.’s general intentions, not the creation of any binding trust obligations on S1. The trial judge granted in part S2’s unconscionable procurement claim against S1.

With respect to S3’s Estate claim to a 50% interest in Townsgate, the trial judge concluded that the joint tenancy between H.G. and S3 had been severed before his death and that they held their interests as tenants in common. She therefore declared H.G.’s survivorship application to be void.

issues:

(1) S2’s Appeals

(i) Did the trial judge err by imposing too heavy a burden of proof on S2 and S3 to establish that a mutual wills agreement existed?
(ii) Did the trial judge err by not finding a secret trust between E.G. and S1?
(iii) Did the trial judge err by failing to void certain inter vivos transfers that S1 had unconscionably procured from H.G.?

(2) H.G.’s Appeals

(i) Did the trial judge err by identifying in paragraph 5 of the judgment E.G.’s real property at the time of his death, even though their respective ownership interests were not the subject of pleadings at trial and the appellant could not meaningfully contribute to the issue of ownership because the trial record was insufficient?
(ii) Did the trial judge err by finding that S3’s Estate owned 50% interest in Townsgate?

holding:

Appeals dismissed.

reasoning:

(1) S2’s Appeals

(i) No.

The only civil standard of proof is proof on a balance of probabilities: F.H. v. McDougall, 2008 SCC 53. In all cases, the evidence adduced to meet this standard must be “sufficiently clear, convincing and cogent” to persuade the trier of fact of the merits of the claim on a balance of probabilities: McDougall. The “quality” of evidence required to meet the standard will vary according to the nature of the claim and the evidence being adduced: Nelson (City) v. Mowat, 2017 SCC 8. Thus, while the quality of the evidence may vary depending on the claim, the standard of proof will always remain the same: proof on a balance of probabilities.

The Court found that the trial judge was clearly alert to the governing law, namely that there is only one civil standard of proof and that to meet that standard, the quality of the evidence had to be sufficiently clear, persuasive, and cogent to convince her of the merits of the mutual will agreement claim on a balance of probabilities. Moreover, as the trial judge explained, the evidence clearly favoured a dismissal of the mutual wills agreement claim. To repeat, “the evidence against the existence of [a mutual wills agreement overwhelmed] any evidence (or suggested inferences) in favour of it.”

(ii) No.

The Court found that the trial judge’s factual findings on the elements required to establish a secret trust revealed no palpable and overriding error.

There was no transfer or grant from E.G. to S1. E.G. did not give anything to S1. On E.G.’s death, his assets vested in H.G. Furthermore, while the Court accepted that a chose in action may satisfy the subject-matter requirement for a trust, it did not address the absence of a transfer. To repeat, there was no transfer or grant pursuant to any alleged secret trust.

(iii) No.

In light of the Court’s dismissal of the mutual wills agreement and the secret trust claims, the unconscionable procurement appeal could only be of benefit to H.G. Nonetheless, the Court addressed the issue.

S2 argued that the transactions ought to have been set aside and advanced two complaints about the trial judge’s unconscionable procurement analysis.

First, S2 submitted that the findings of the trial judge were logically inconsistent in that she relied on Dr. Shulman’s evidence to rebut the presumption of unconscionable procurement with respect to certain transactions and then described it as unreliable and misinformed with respect to others. The Court did not agree with this complaint. The trial judge laboriously went through each transaction and carefully considered whether the presumption of unconscionable procurement had been rebutted.

Second, S2 submitted that the trial judge erred in ruling that the large transfers in 2013 and 2014 from H.G. to A.G. were simply gifts. He argued that some limits should have been applied to the extent of the gift-giving and the manner in which they were made. The Court found no error. The trial judge concluded that the conveyances to A.G. and S1 appeared to be consistent with H.G.’s theme of wanting to give H.G.’s half of the family holdings to S1 and his family. The Court saw no basis on which to interfere with the trial judge’s findings on these transactions.

(2) H.G.’s Appeals

(i) No.

The pleadings, the written opening submissions and the closing submissions all supported the trial judge’s conclusion that the issue of ownership was in play. Moreover, the issue was fully canvassed before the trial judge, as was evident from her reasons. Although ultimately unsuccessfully, the composition of E.G.’s estate was also relevant to the secret trust claim and necessary to identify the property S1 was required to relinquish due to the unconscionable procurement claim. The trial judge’s analysis supported inclusion of paragraph 5 in the judgment.

(ii) No.

H.G. advanced two arguments. First, H.G. submitted that the acknowledgment and direction document was never registered nor delivered to S3 or anyone on his behalf. Accordingly, S3 died without any knowledge of the document. H.G. submitted that an uncommunicated intention was insufficient and that absent communication any severance was ineffective and the trial judge erred in finding otherwise.

Second, H.G. submitted that the trial judge erred in finding that H.G. sought and was granted security on S3’s interest. She maintained that a fair reading of Mesbur J.’s endorsement makes it manifest that H.G. did not seek the protection given to her. Rather, it was given of the trial judge’s own volition and not at H.G.’s request. H.G. asserted that S3’s proposal for protection was not tied to his interest in Townsgate but to his share, if successful, in the main action.

The Court found that the trial judge correctly determined that the joint tenancy was severed by S3 and H.G.’s mutual course of dealing. Accordingly, there was no need to determine whether a declaration of unilateral intention was insufficient to sever a joint tenancy.

The Court further found that it was not evident that H.G. proposed the security that was the subject matter of Mesbur J.’s disposition but, contrary to H.G.’s submissions, the trial judge did not make that finding. Rather, she correctly identified H.G.’s stated concern before Mesbur J.

Urbancorp Toronto Management Inc. (Re), 2022 ONCA 181

[Strathy C.J.O., Roberts and Sossin JJ.A.]

Counsel:

N. Rabinovitch and K. Kraft, for the moving party, G.G., in his capacity as Foreign Representative of Urbancorp Inc.

R.B. Schwill, for the responding party, KSV Kofman Inc., in its capacity as Monitor

B. Kofman, N. Goldstein and R. Harlang, for the responding party, KSV Restructuring Inc.

A. Winton, for the responding party, D.S.

facts:

Pursuant to s. 13 of the Companies’ Creditors Arrangement Act (“CCAA”), the moving party, in his capacity as Foreign Representative of Urbancorp Inc., sought leave to appeal from the distribution order of the Supervising Judge of the Superior Court of Justice authorizing the court-appointed Monitor of the applicants to make a distribution to King Towns North Inc. (“KTNI”). KTNI is the owner of certain lands known as the “Berm Lands” and the landlord under a lease of these to certain entities. The Monitor did not join in the motion.

issues:

(1) Should the Court grant leave to appeal from the distribution order?

a. Is the proposed appeal prima facie meritorious?
b. Are the points on the proposed appeal of significance to the practice?
c. Are the points on the proposed appeal of significance to the action?
d. Will the proposed appeal unduly hinder the progress of the action?

holding:

Motion dismissed.

reasoning:

(1) No.

(a) No.

The moving party did not satisfy the first branch of the test for leave. None of the alleged errors raised a prima facie meritorious issue for appeal. The errors identified by the moving party were, at their highest, mixed questions of fact and law and would not be set aside in the absence of an extricable error of law or a palpable and overriding error in the assessment of the evidence.

(b) No.

The Court found that none of the proposed grounds for appeal could be described as matters of importance to the practice. In the case of the application of the anti-deprivation rule, the Supreme Court of Canada’s decision in Chandos clearly lays out the framework. Further, the application of the rule will necessarily be fact-specific and dependent upon the interpretation of particular terms of the contract in each individual case. For this reason, alleged interpretive errors by the Supervising Judge will be of limited assistance in future cases.

While the points on the proposed appeal may have been of significance to the action, standing alone, this factor was insufficient to warrant granting leave to appeal.

(d) Yes.

The proposed appeal would have unduly hindered the completion of the proceedings, which had been underway for nearly six years and were nearing completion.

Stamatopoulos v. Harris, 2022 ONCA 179

[Simmons, Harvison Young and Zarnett JJ.A.]

Counsel:

A. Rouben, for the appellants

D. G. Boghosian, for the respondent, the Regional Municipality of Durham

B. M. Bangay, for the respondent, R. J. H.

facts:

This was an appeal from a judgment dismissing an action against the Regional Municipality of Durham pursuant to s. 44 of the Municipal Act on the basis that it had failed to keep a roadway in a reasonable state of repair. The appellants commenced an action against Durham and the respondent, Mr. H., following a motor vehicle accident in November 2004. The appellant, Mr. S., was a front seat passenger in a vehicle driven by Mr. H.. The two men were travelling on the road around 8:30 p.m. when Mr. H. lost control of the vehicle while driving over a depression or dip in the roadway. The vehicle rotated, left the roadway and travelled across the shoulder and into a ditch, where it hit a hydro pole. The vehicle travelled a further distance and collided, passenger side, into a group of trees and an embankment. Mr. S. suffered life altering injuries.

Mr. H. conceded that he was negligent and that his driving was a cause of the collision. He reached a settlement with the appellants in 2010. However, he and the appellants alleged that the road where the collision occurred was in a state of non-repair, due to the dip in the road, and that this was also a cause of the collision. Damages were settled before the trial. The sole issues at trial were whether the respondent Durham was liable in negligence and, if so, what the apportionment of damages should be.

The trial judge found that the roadway was not in a state of non-repair. The appellants appealed from that finding. Mr. H. appealed initially, but abandoned his appeal. He filed a factum only in relation to the costs award in the event the appellants were successful.

issues:

Did the trial judge commit an extricable error of law in analyzing the question of whether the road was in a state of non-repair?

holding:

Appeal dismissed.

reasoning:

No.

There was no dispute that the applicable four-part test for establishing the statutory cause of action in negligence against a municipality was set out by this court in Fordham:

1. Non-repair: The plaintiff must prove on a balance of probabilities that the municipality failed to keep the road in question in a reasonable state of repair.
2. Causation: The plaintiff must prove the “non-repair” caused the accident.
3. Statutory Defences: Proof of “non-repair” and causation establish a prima facie case of liability against a municipality. The municipality then has the onus of establishing that at least one of the three defences in s. 44(3) applies.
4. Contributory Negligence: A municipality that cannot establish any of the three defences in s. 44(3) will be found liable. The municipality can, however, show the plaintiff’s driving caused or contributed to the plaintiff’s injuries.

First, the Court did not agree that the trial judge conflated Mr. H.’s negligence with her finding that the road was not in a state of non-repair such that it would have presented a hazard to an ordinary reasonable driver. She summarized the factors that she considered in determining whether the road was in such a state of non-repair that it would have presented a hazard to an ordinary reasonable driver in her reasons.

The trial judge then analyzed all of the factors other than Mr. H.’s manner of driving. She concluded on the basis of those factors that the road was not in a state of non-repair. There was ample evidence to support this, including the qualitative evidence of witnesses who live in the area and knew the dip, the agreed fact that there had been no prior collisions identified at this site attributable to the depression since 1993, police evidence of “runs” conducted over the dip at various speeds up to 120 km per hour, applicable guidelines regarding road depressions, as well as guidelines regarding signage for road hazards.

Only after so concluding did the trial judge turn to Mr. H.’s driving, and how his manner of driving related to whether the road was in a state of non-repair such as to create a risk to the ordinary reasonable driver. She made a finding of fact that Mr. H was driving 100 km per hour when he began to cross the dip, and that he was distracted as he had no hands on the wheel, having just opened a pop bottle. He was not an ordinary reasonable driver.

The Court did not accept the premise that, because the trial judge considered Mr. H.’s manner of driving, she conflated the analysis. She did not reason that, because he was driving in a manner that was not that of an ordinary reasonable driver, the road was not in a state of non-repair. She began her analysis of this issue by setting out the Fordham test and focusing on the question of whether the dip in the road constituted a state of non-repair. Having found that it was not a risk to the ordinary reasonable driver, she considered Mr. H.’s driving, and found that he was not driving as an ordinary reasonable driver, which was consistent with her finding on the state of the road. Had she found that Mr. H.’s manner of driving was that of the ordinary reasonable driver, and an accident had still occurred, she would have had to reconsider whether the road posed a hazard to the ordinary reasonable driver.

The Court saw no error in taking the manner of Mr. H.’s driving into account as a part of the trial judge’s consideration of whether the road was in a state of non-repair. Read in context, this was simply one factor considered.

Nor did the Court agree that the trial judge erred by adopting too low a standard (100 km) for conduct taking a driver beyond the scope of an ordinary reasonable driver. The appellants argued that this finding was unreasonable on the basis that a significant percentage of drivers travel the same stretch of road at speeds exceeding 90 km an hour and that this effectively immunized the municipality from liability pursuant to s. 44 of the Act.

The trial judge found that the ordinary reasonable driver would not exceed the speed of 100 km per hour on that stretch of road. This was a finding of fact that she reached after a careful review of the evidence. The Court saw no basis for interfering with this finding.

SHORT CIVIL DECISIONS

Victor Ages Vallance LLP v. OZ Optics Ltd., 2022 ONCA 169

[Feldman, MacPherson and Lauwers JJ.A]

Counsel:

N. Karnis, for the appellants OZ Optics Ltd., OZ Merchandising Inc., Ottawa Wizards, and OZ Dome Soccer Club

O.S., acting in person

D. Cutler, for the respondent

IT Haven Inc. v. Certain Underwriters at Lloyd’s, London (Costs), 2022 ONCA 189

[Strathy C.J.O., Zarnett J.A. and Wilton-Siegel J. (ad hoc)]

Counsel:

J. Spotswood and C. Beaudoin, for the appellant

R. Huang and V. DeMarco, for the respondents

Keywords: Civil Procedure, Costs

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

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COURT OF APPEAL SUMMARIES (FEBRUARY 28, 2022 – MARCH 4, 2022)

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John Polyzogopoulos Blaney McMurtry LLP 416.593.2953 Email

Table of Contents

Yatar v. TD Insurance Meloche Monnex, 2022 ONCA 173

The Catalyst Capital Group Inc. v. Dundee Kilmer Developments Limited Partnership, 2022 ONCA 168

2501306 Ontario Inc. v. Country Garden Academy Inc., 2022 ONCA 177

1504641 Ontario Inc. v. 2225902 Ontario Inc., 2022 ONCA 175

Yang v. Co-operators General Insurance Company , 2022 ONCA 178

Gefen Estate v. Gefen, 2022 ONCA 174

Urbancorp Toronto Management Inc. (Re), 2022 ONCA 181

Stamatopoulos v. Harris, 2022 ONCA 179

Victor Ages Vallance LLP v. OZ Optics Ltd., 2022 ONCA 169

IT Haven Inc. v. Certain Underwriters at Lloyd’s, London (Costs), 2022 ONCA 189

CIVIL DECISIONS

Yatar v. TD Insurance Meloche Monnex, 2022 ONCA 173

Counsel:

facts:

issues:

holding:

reasoning:

The Catalyst Capital Group Inc. v. Dundee Kilmer Developments Limited Partnership, 2022 ONCA 168

Counsel:

facts:

issues:

holding:

reasoning:

2501306 Ontario Inc. v. Country Garden Academy Inc., 2022 ONCA 177

Counsel:

facts:

issues:

holding:

reasoning:

1504641 Ontario Inc. v. 2225902 Ontario Inc., 2022 ONCA 175

Counsel:

facts:

issues:

holding:

reasoning:

Yang v. Co-operators General Insurance Company, 2022 ONCA 178

Counsel:

facts:

issues:

holding:

reasoning:

Gefen Estate v. Gefen, 2022 ONCA 174

Counsel:

facts:

issues:

holding:

reasoning:

Urbancorp Toronto Management Inc. (Re), 2022 ONCA 181

Counsel:

facts:

issues:

holding:

reasoning:

Stamatopoulos v. Harris, 2022 ONCA 179

Counsel:

facts:

issues:

holding:

reasoning:

SHORT CIVIL DECISIONS

Victor Ages Vallance LLP v. OZ Optics Ltd., 2022 ONCA 169

Counsel:

IT Haven Inc. v. Certain Underwriters at Lloyd’s, London (Costs), 2022 ONCA 189

Counsel:

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John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email