Blaney's Appeals: Ontario Court Of Appeal Summaries (November 19 – 23, 2018) Mr John Polyzogopoulos

There were five substantive civil decisions released by the Court of Appeal this week. There were many criminal decisions released.

In Wall v. Shaw, the Court determined that there is no limitation period to objecting to accounts in an application to pass accounts in an estates matter. A notice of objection is not a "proceeding" within the meaning of the Limitations Act, 2002.

In Thunder Bay (City) v. Canadian National Railway Company, the Court denied CN Rail a stay of its ruling handed down earlier this year pending leave to appeal to the Supreme Court of Canada. The Court held that the potential harm to CN was quantified at four to six million dollars if a stay was not granted and CN Rail's appeal was ultimately successful. However, balanced against that was the fact that CN contributed to the possibility of irreparable harm by failing to move more expeditiously for leave and that the potential for serious impacts on Thunder Bay and the First Nation increased the longer the reopening of the Bridge was delayed. Ultimately, however, the Court felt that the proposed appeal did not have sufficient merit to warrant the granting of a stay.

Other topics included the distinction between final and interlocutory orders, hearsay evidence and equitable set-off in the context of summary judgment for fraud, statutory interpretation of the Health Care Consent Act, and a proper pleading of claims for misfeasance in public office and malicious prosecution.

In our Top Appeals of 2017 CLE held at the OBA this past February, one of the decisions we featured was Moore v Sweet. Our summary of the decision can be found here. At the time of our CLE in February, the appeal to the Supreme Court had just been argued. Today, the Supreme Court allowed the appeal, finding in favour of Ms. Moore. This is an important decision on the law of unjust enrichment and constructive trust. Congratulations to counsel for both sides, who had participated in our CLE panel, David Smith and Jeremy Opolsky, for a job well done. Stay tuned for details on this year's Top Appeals CLE, which will be taking place as

CIVIL DECISIONS

Thunder Bay (City) v Canadian National Railway Company, 2018 ONCA 919

Counsel:

G.J. Pratte and D.A.W. Ault, for the moving party, Canadian National Railway Company

C.J. Matthews and S. Sood, for the responding party, The Corporation of the City of Thunder Bay

S.W. Crowe, for the responding party, Fort William First Nation

Keywords: Civil Procedure, Appeals, Stay Pending Appeal, Supreme Court Act, RSC 1985, c S-26 s 40(1), RJR-MacDonald Inc v Canada (Attorney General), [1994] 1 SCR 311, Yaiguaje v Chevron Corporation, 2014 ONCA 40

FActs:

The appellant moved for a stay of the Court of Appeal's order made in June 2018, which required the appellant to reopen the James Street Bridge in Thunder Bay (the "Bridge") for vehicle traffic and maintain the Bridge in accordance with a 1906 agreement. The appellant owns the Bridge, which traverses the Kaministiquia River. Under s. 3 of the 1906 agreement, the appellant's predecessor gave the City respondent's predecessor "the perpetual right to cross the Bridge for street railway, vehicle and foot traffic". Under s. 5, the appellant's predecessor agreed to "maintain the bridge in perpetuity". Following a fire in 2013, the appellant closed the Bridge to vehicle traffic, claiming it was unsafe and could only be made safe through structural repairs that were beyond the scope of its maintenance obligation under the 1906 agreement.

In 2017, the application judge dismissed the City respondent's application for a declaration that the appellant is obliged to maintain the Bridge in perpetuity and required to reopen the Bridge for vehicle traffic. He concluded that it was the intention of the parties to the 1906 agreement that the Bridge be maintained for the type of bridge traffic that existed when the agreement was made, namely streetcar and horse and cart traffic. Further, he found that the appellant had consistently taken the position that it was not obliged to make structural changes to the Bridge that would permit modern motor vehicle traffic.

On June 11, 2018, the Court of Appeal set aside the application judge's order. Among other things, the Court of Appeal found that the application judge's conclusion concerning the parties' intentions was unreasonable and tainted by extricable errors of law. The appellant filed a notice of application for leave to appeal the Court of Appeal's order to the Supreme Court of Canada on August 20, 2018. In its leave application, the appellant submitted that the Court of Appeal's decision raised two issues of public importance that warranted granting leave to appeal:

Whether an appellate court can impose a perpetual maintenance obligation that it refuses to define without affording basic procedural fairness. Whether a minimal level of specificity is required for a mandatory order. ISSUES:

(1) Should the Court of Appeal's order made in June 2018, which required the appellant to reopen the Bridge for vehicle traffic and maintain the Bridge in accordance with the 1906 agreement, be stayed pending leave to appeal to the Supreme Court of Canada?

Holding:

Motion dismissed.

Reasoning:

(1) No. The basic test for granting a stay pending leave to appeal is the same as the test for granting an interlocutory injunction. The moving party must demonstrate: i) a serious issue to be adjudicated on appeal; ii) that it will suffer irreparable harm if a stay is not granted; and iii) that the balance of convenience favours granting a stay: RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311, at p. 314. Overall, the court must decide whether, taking all relevant considerations into account, the interests of justice warrant granting a stay. Although, ordinarily, the threshold for establishing a serious issue to be adjudicated is low, the criteria for granting leave to the Supreme Court of Canada adds another layer to the test. Under s. 40(1) of the Supreme Court Act, R.S.C. 1985, c. S-26, leave may be granted where any question involved is one that ought to be decided by the Supreme Court by reason of its public importance or the importance of any issue of law or any issue of mixed fact and law or for any other reason of such a nature and significance as to warrant a decision by the Supreme Court. The stay test requires that a judge hearing a stay motion consider not only whether the proposed appeal raises a serious issue to be adjudicated under RJR-Macdonald. The judge must also consider the factors in s. 40(1) and assess whether there is some merit in the leave application.

(i) Serious issue to be adjudicated and s. 40(1) criteria

The motion concluded that it was unlikely that the appellant would succeed in its application for leave to appeal to the Supreme Court of Canada. As noted above, the appellant submitted that the Court of Appeal's decision gave rise to two issues of public importance that warrant granting leave:

Whether an appellate court can impose a perpetual maintenance obligation that it refuses to define without affording basic procedural fairness. Whether a minimal level of specificity is required for a mandatory order. Concerning the first issue, the appellant submitted that the imposition of a maintenance obligation unbounded in scope and duration is a departure from established jurisprudence. It contended that the Court of Appeal's decision created uncertainty in contracts and statutory provisions under which parties are obliged to provide (or enjoy the benefit of) maintenance. Further, the appellant submitted that the Court of Appeal imposed this maintenance obligation by erroneously finding that its scope was irrelevant to the proceeding because of a stay imposed in relation to the appellant's original action against the City respondent.

As a starting point, the motion judge saw little merit in the appellant's submissions about the scope of maintenance obligations and the impact of the Court of Appeal's decision on other contracts or statutory provisions imposing maintenance obligations. It was the 1906 agreement, not the Court of Appeal, that created a perpetual right to cross the Bridge and that imposed a maintenance obligation in perpetuity. Moreover, the motion judge failed to see how the Court of Appeal's interpretation of the specific provisions of the 1906 agreement, a rather unique contract, was likely to have an impact on the interpretation of other contracts or statutes.

Similarly, the motion judge saw little merit in the appellant's arguments that the Court of Appeal erred in finding that the distinction the appellant drew between its maintenance obligations and making structural changes to the Bridge was irrelevant in the context of the proceeding. In its factum filed on the appeal to the Court of Appeal, the City respondent took the position that the appellant's stance was akin to a party seeking to rely on the doctrine of frustration to excuse its breach of contract. That is the precise basis on which the Court of Appeal concluded that the distinction the appellant sought to draw between maintenance and structural changes was irrelevant in the proceeding.

In any event, the motion judge held that this was not the type of case in which the Supreme Court of Canada is likely to grant leave to appeal. This case involved the interpretation of a private contract in which established legal principles were applied. It was therefore not the type of case in which the Supreme Court typically grants leave to appeal.

Concerning the second issue, the appellant asserted that the Court of Appeal erred by ordering the appellant to reopen and maintain the Bridge without giving any direction as to when the Bridge was to be reopened, how the Bridge was to be maintained or what the duty to maintain consisted of. The appellant submitted that this was inconsistent with existing jurisprudence on both maintenance obligations and mandatory...