Court Of Appeal Summaries (October 17 – 21, 2016)

Hello,

Below are the summaries for this week's civil decisions of the Court of Appeal. There were two interesting civil decisions. In Canada Post Corporation v. Hamilton (City), the Court of Appeal considered the question of whether or not the municipality of Hamilton (which apparently opposed the federal government's decision to do away with door to door mail delivery) had the authority to become involved in the decision of where to place thousands of Canada Post mailboxes. On constitutional division of powers grounds, the Court found that the City's By-Law conflicted with federal regulations granting the authority to Canada Post, therefore the City's appeal from the quashing of its By-law was dismissed.

In Novatrax International Inc. v. Hägele Landtechnik GmbH, the Court of Appeal addressed the effect of a forum selection and arbitration clause in an agreement. The Court of Appeal was split in its decision. Justice Brown, writing for the majority, held that the clause led to a stay of all the claims in Ontario, even those against defendants who were not parties to the arbitration agreement. Justice Feldman disagreed with the majority and held that the stay of the claims against the non-parties to the arbitration clause should be set aside. She held that the stay unjustifiably deprived the appellant of its right to litigate those claims in Ontario under Ontario law. In reaching this conclusion, Justice Feldman adopted a three-part test used by the Alberta Court of Appeal to address the question of jurisdiction where some parties are subject to an arbitration agreement and some are not.

This case highlights the difficulties that can often arise with arbitration clauses. Such clauses are inserted by our solicitor colleagues into commercial agreements to try to provide for a more efficient, timely, cost-effective and private dispute resolution process. Instead, an arbitration clause can often end up making things more complicated, drawn out, costly and just as public as court proceedings. I often wonder whether arbitration clauses are more trouble than they are worth. Rather than agree to them on the front end, perhaps we as a litigation bar should consider whether it would be more appropriate to explore arbitration after a dispute has arisen, even where there is no arbitration clause. By that point, the parties actually know what the issues are and what parties are involved, and can custom design their arbitration. Doing this, of course, requires cooperation of counsel and their clients, which is easy to say but hard to do in practice given the adversarial nature of litigation, where parties are constantly seeking to gain the upper hand on one another.

Other topics covered this week included slip and fall, striking a claim for disclosing no cause of action and being an abuse of process, a dispute over entitlement to land following the entering into of a sham agreement of purchase and sale, and family law.

Please feel free to share this blog with anyone whom you think might be interested. As always, we welcome your comments and feedback.

Have a nice weekend.

Civil Decisions:

Bonilla v. Preszler, 2016 ONCA 759

[Hoy A.C.J.O., Benotto and Huscroft JJ.A]

Counsel:

11. Doan, for the appellant

5. Grossman, for the respondent The Personal Insurance Company of Canada

   Keywords: Insurance Law, Statutory Accident Benefits, Income Replacement Benefits, Limitation Periods, Insurance Act, Statutory Accident Benefits Schedule - Accidents on or After November 1, 1996, O. Reg. 403/96

   Facts:

   The appellant appealed the decision of the motion judge, which granted summary judgment and dismissed the appellant's action against the respondent insurer for terminating the Income Replacement Benefits ("IRB") she had been receiving. The motion judge concluded that the appellant's action was barred by the two-year limitation period by the Insurance Act, R.S.O. 1990 c. I.8 and the Statutory Accident Benefits Schedule - Accidents on or After November 1, 1996, O. Reg. 403/96.

   At the time the respondent informed the appellant that it would no longer pay the IRB (February 2003), the appellant was represented by counsel and did not challenge the respondent's decision. In 2007 the appellant retained new counsel and commenced her proceeding for IRB by applying for mediation on April 3, 2008. After the mediation failed, the appellant commenced her action against the respondent on December 12, 2008 - almost six years following the end of her IRB.

   Issues:

   Was the respondent's termination notice clear and unequivocal? Did the motion judge err in concluding that the action was time barred? Holding:

   Appeal dismissed.

   Reasoning:

   1. Yes. The respondent insurer sent two letters to the appellant indicating that it refused to pay her claim for benefits, the second of which was copied to her then lawyer. The motion judge correctly found that the message was clear an unequivocal.

   2. No. The Court rejected that appellant's assertion that the two-year limitation period is a rolling limitation period, such that each refusal to pay IRB sets a new two-year limitation term running. It is well established in case law that the limitation period is triggered by a single event, which in this case was the refusal of an insurer to pay the IRB claimed: see e.g. Bonaccorso v. Optimum Insurance Company Inc., 2016 ONCA 34, 129 O.R. (3d) 544 and Sietzema v. Economical Mutual Insurance Company, 2014 ONCA 111, 118 O.R. (3d) 713. Based on the date of the refusal, the appellant's action was several years too late.

   Palkowski v. Ivancic, 2016 ONCA 762

   [Pardu, Benotto and Huscroft JJ.A]

   Counsel:

18. G. Chapman, for the appellant

13. Z. Tufman and G.A.P. Tufman, for the respondents

    Keywords: Endorsement, Real Property, Agreements of Purchase and Sale, Fraud, Conveyancing and Law of Property Act, Trusts, Express Trusts, Constructive Trusts, Unjust Enrichment

    Facts:

    The parties to this appeal signed an agreement of purchase and sale with respect to the respondents' home at a price that was significantly below market value. The document was signed as part of a joint scheme with the appellant to defraud the respondents' creditors by tricking them into believing that the respondents could not pay their debts. The trial judge found the agreement of purchase and sale to be a "sham."

    Litigation began between the parties in 2005 when the appellant refused the respondents' demand that the property be re-conveyed to them. The respondents claimed that the property was held in an express trust for them, and also claimed unjust enrichment and a constructive trust. The respondents' claim for an express trust was dismissed on a summary judgment motion because it was an agreement that was not in writing. The Court of Appeal upheld the decision. The remaining claims went to trial. The respondents sought relief for unjust enrichment, and a re-conveyance of the property pursuant to s. 37(1) of the Conveyancing and Law of Property Act, R.S.O. 1990, c. C.34 ("CLPA"). The trial judge granted judgment in the respondents' favour and ordered a re-conveyance to them, subject to a payment to the appellant to reflect his contributions which included a cash payment to the respondents at the time of the conveyance.

    Issues:

    Did the trial judge err by ordering the transfer of the property pursuant to an unjust enrichment analysis? Did the trial judge fail to apply the "clean hands" doctrine to the claim for equitable relief? Did the trial judge err in his application of s. 37(1) of the CLPA? Holding: Appeal dismissed.

    Reasoning:

    1. The trial judge found that the appellant had been enriched and that there was a corresponding deprivation on the part of the respondents. He concluded that there was no juristic reason to justify the enrichment. The appellant submitted that in this respect the trial judge erred because the existence of a contract can constitute a juristic reason for an enrichment. The existence of the agreement of purchase and sale, they argued, constitutes an absolute bar to a claim for unjust enrichment.

       This submission ignored the trial judge's unchallenged finding with respect to the agreement of purchase and sale. The trial judge found that the agreement was a "sham" transaction. Thus, as between the appellant and respondent, there was no contract to bar the claim for unjust enrichment.

    2. The trial judge correctly applied the doctrine of unjust enrichment. He found that monetary damages were not adequate and that there was a link between the contribution that founded the action and the property in which the constructive trust was claimed. The discretionary remedy was based on the findings of the trial judge, which are not challenged by the appellant. The trial judge's reasons make it abundantly clear that he was aware of the "clean hands" doctrine. He considered neither party to be blameless and used his discretion to fashion an appropriate remedy.

    3. The panel found that whether the trial judge could have granted the same relief under s. 37(1) of the CLPA did not need to be considered.

       Mazza v. Ornge Corporate Services Inc., 2016 ONCA 753

       [Strathy C.J.O., LaForme and Benotto JJ.A.]

       Counsel:

1. Schorr, for the appellant J. Goodman and E. O'Dwyer, for the respondent

   Keywords: Endorsement, Employment Law, Wrongful Dismisssal, Common Employers

   Facts:

   The appellant, Mazza, entered into Minutes of Settlement with the trustee in bankruptcy of his former employer, releasing the bankrupt estate from his claim for termination of his employment and from all other claims that could have been raised in the bankruptcy.

   The appellant then brought similar claims against affiliated companies, asserting they were liable, as common employers, for the termination of his employment. He also asserted claims for interference with economic relations and conspiracy to injure, alleging that they conspired to use the bankruptcy process to defeat his legitimate claims.

   The motion judge dismissed the plaintiff's claims...