Court Of Appeal Summaries (January 30 – February 3, 2017)

Good Evening,

Below are the summaries for this week's civil decisions of the Court of Appeal for Ontario. Topics covered this week included: the effect of pending retirement on a high income earner with spousal support obligations (Schulstad); a dispute between two law firms regarding an agency agreement that resulted in a charging order (Fancy Barristers); and the sufficiency of a pleading in a defamation case (Catalyst Capital).

For those interested in the hot topic of "conflicts of interest", you may wish to read the entire Whirlpool decision which contains a dissenting opinion.

Have a nice weekend.

CIVIL DECISIONS:

Fancy Barristers P.C. v. Morse Shannon LLP, 2017 ONCA 82

[Benotto, Brown and Miller JJ.A.]

Counsel:

S. Siddiqui, for the appellants

J.R. Morse, for the respondents

Keywords: Endorsement, Charging Order, Solicitors Act, s.34, Thomas Gold Pettinghill LLP v. Ani-Wall Concrete Forming Inc., 2012 ONSC 2182, Judicial Bias, Wewaykum Indian Band v. Canada, 2003 SCC 45

Facts:

This appeal involved a dispute between law firms that resulted in a charging order granted by the application judge for fees. Fancy Barristers P.C. ("Fancy") was retained on a contingency fee basis by two minor plaintiffs. Fancy retained Morse Shannon LLP ("Morse") to assist with the claims on the agreement that Fancy and Morse would split the fees in the two actions after repayment for docketed time and disbursements. Morse spent time and incurred fees and disbursements, but the relationship between Fancy and Morse broke down and the agency agreements were terminated. Fancy did not pay Morse for docketed time or disbursements. The judge granted charging orders to ensure Morse would be paid out of eventual proceeds.

Issues:

Did the judge err in granting the charging order?

Holding:

Appeal dismissed.

Reasoning:

No. Despite the fact that the terms of the charging order covered the entire proceeds of the plaintiffs' recovery, not just the 25% referred to in the agreements, Morse acknowledged that it was never its intent to interpret the order to apply to the entire proceeds.

Fancy further argued that the application judge was biased, relying on the fact that she changed her view on certain points. There is a strong presumption of judicial impartiality and a heavy burden on the party seeking to rebut the presumption. The Court found nothing in the material that rebutted the presumption of impartiality.

Szymanski v Alaimo, 2017 ONCA 86

[Doherty, Brown and Miller JJ.A.]

Counsel:

C. A. Muccilli, for the appellant

G. L. Adrian, for the respondent

Keywords: Endorsement, Right-of-Way, Form of Order

Facts:

This appeal concerned a dispute between the parties with respect to a right-of-way. Also at issue was the form of an order made by the application judge. Certain undertakings were referred to in the recitals to the order, but were not made part of the formal order and were not part of any declaration made by the application judge.

Issues:

Did the application judge err in holding that the right-of-way provided the appellant only with access to the garage along the existing laneway? Did the application judge err in his findings with respect to certain posts erected as part of a fence constructed by the respondents along a pathway? Is there an issue as to the form of the order made by the application judge? Holding:

Appeal dismissed.

Reasoning:

The application judge properly instructed himself on the controlling legal principles. He was required to examine both the terms of the document that created the right-of-way and the surrounding circumstances. His determination as to the nature and scope of the right-of-way is a finding of fact. The application judge made no legal error and did not misapprehend the evidence in coming to his conclusion as to the nature of the appellant's right-of-way. The Court of Appeal deferred to the application judge's finding of fact. The application judge found that the posts did intrude to a small extent on the right-of-way. The application judge made no finding that the posts in any way interfered with the use of the right-of-way as a means of getting into and out of the garage. The issue was moot. The posts are gone so there was no reason to consider the effects on the right-of-way. As part of the order, the application judge accepted certain undertakings from the respondents (not to reinstall gates that had been removed and to move fence posts). The form of the order is a matter for the discretion of the application judge. Some judges might have included the substance of the undertakings as part of a formal declaration and others would not. When it comes to enforcing the order, there is no significant difference between the two options. There was no reason to interfere with the manner in which the application judge chose to frame the order. Whirlpool Canada Co. v. Chavila Holdings Limited, 2017 ONCA 81

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

Counsel: J. Dahany and G. D. Graham, for the appellant A. Sternberg and J. Figliomeni, and the respondents

Keywords: Conflict of Interest, Duty to Defend, Bright Line Rule, Canadian National Railway Co. v. McKercher LLP, 2013 SCC 39, R v. Neil, 2002 SCC 70, Indemnity Agreement

Facts:

In the early 1990s, an area of land on the western edge of downtown Toronto was being assembled for development. It is now known as Liberty Village. The land consisted of four adjacent properties: the CP Lands, the Oxford Lands, the CN Lands and the Inglis Lands.

In 1990, 863800 Ontario Limited ("863") purchased the CP and Oxford Lands. In 1991, 863 sought to purchase Whirlpool's parcel (the Inglis Lands) through its related corporations Chavila and Outrigger. It was discovered that the soil and groundwater on all four properties were contaminated. Negotiations ended but resumed years later when Whirlpool lowered its asking price in exchange for Chavila and Outrigger agreeing to indemnify it for all liability arising from the condition of the property (the "Indemnity Agreement"), and to defend any...