Ontario Court Of Appeal Summaries (May 24-27)

Hello everyone,

Following are this week's summaries of civil decisions released by the Court of Appeal. Topics covered include: Family law (wardship), bankruptcy and insolvency (essential elements to obtain bankruptcy order and the treatment of after-acquired property of an undischarged bankrupt), stay of pending appeal to the Supreme Court (Livent), torts (proximity and the Anns test).

There were several decisions involving real estate. One of them was perhaps the most interesting decision of the week. In the Israel Estate decision, Justice Laskin discusses the difference between an option to purchase and a right of first refusal. This is an important distinction, because the former results in an interest in land whereas the latter only results in a personal right, but not an interest in land. In this case, if the clause in the contract in question was an option to purchase creating an interest in land, it would be void as violating the rule against perpetuities. The motion judge found that the clause in question did not create an interest in the land and therefore the rule against perpetuities did not apply. The clause could still be enforced. The Court of Appeal reversed this decision, finding that the clause in question was an option to purchase. In coming to its decision, the court also commented on the implied contractual obligation to exercise contractual discretion reasonably and in good faith. In addition, the court doubted that the deferential standard of review of contractual interpretation imposed by Sattva Capital v Creston Moly applied in this case because the application judge had not actually interpreted the agreement in question, but had erroneously applied the law on the degree of control necessary for a contractual right to rise to the level of an option to purchase creating an interest in land. Accordingly, the court applied the correctness standard. In the alternative, if the deferential standard of review applies, the court held that the application judge's interpretation was unreasonable.

Wishing you all the best for the upcoming weekend.

CIVIL DECISIONS

Carleton Condominium Corporation No. 396 v. Burdet, 2016 ONCA 394

[Rouleau, Pardu and Benotto JJ.A]

Counsel:

Claude-Alain Burdet, for the appellant

Christopher Rootham and Nancy Houle, for the respondent

Keywords: Real Property, Condominiums, Condominium Act, 1998, Statutory Interpretation, Common Expenses, Remedies, Liens, Collateral Attack, Standing

Facts:

The appellants owned several condominiums and failed to pay routine condominium fees to the respondent. When an action to recover the fees commenced in 2009, the respondent corporation was managed by a court-appointed administrator as a result of another proceeding commenced in 2002. Three days before trial, one of the appellants transferred ownership of all but one of the condominium units to the corporation ETRE. ETRE was added as a defendant in the original proceedings, and was represented by the same counsel as the other defendants. The trial judge awarded a remedy against ETRE.

The trial judge held that the appellants owed close to $300,000 in condominium fees to the respondent, and that liens and notices of sale relating to several of the appellant's units were valid.

Issues:

(1) Did the trial judge err in making his determinations?

Holding: Appeal dismissed with costs to the appellant fixed at $27,000, all inclusive.

Reasoning:

(1) No, the appeal should be dismissed. The appellant challenged the action on the basis that the respondent corporation was managed by a court-appointed administrator following an order that was improperly made. The court rejected this argument, citing the rule against collateral attacks, holding that final orders or judgments other than those under appeal cannot be challenged. For the same reasons, the court rejected the appellant's appeal against a trial management order, and an appeal against a partial summary judgment order. The court cited s.84(3)(b) of the Condominium Act, which provides that owners are not exempt from contributing to common expenses despite a claim being made against the condominium corporation.

The appellants challenged the trial judge's award against ETRE. The court held that although ETRE was a party by consent, ETRE had not appealed the judgment against it. The court ruled that the appellants had no standing to challenge the order against ETRE, despite the corporation being controlled by one of the appellants.

The appellants submitted that under the Condominium Act, 1998 corporations have no power to sue for unpaid common expenses and can only enforce a lien. The court held that s.136 of the Condominium Act, 1998 allows for the pursuit of other remedies unless restricted elsewhere in the Act. The court cited the principle from Bell ExpressVu Limited Partnership v Rex that courts must interpret statutes in their ordinary sense and in a manner consistent with the scheme of the Act, the object of the Act, and the intentions of the enacting legislature. The court held that the intention behind the Condominium Act, 1998 cannot have been to limit corporations to recovery by way of registering a lien, and that s.136 therefore allows corporations to sue as a means of recovery.

The appellants challenged many of the trial judge's findings. The court held that all of the disputed findings were reasonably open to the trial judge on the basis of the evidence.

Children's Aid Society of Toronto v. M.S,, 2016 ONCA 396

[J.C. McPherson J.A., P. Lauwers J.A. and C. W. Hourigan J.A.]

Counsel:

M.S., in person

Ian Ross, for the children E. and A.

Tammy Law, for the respondent the Children's Aid Society of Toronto

Marguarida Pacheco, as amicus

Keywords: Family Law, Crown Wardship, Status Review, Canadian Charter of Rights and Freedoms, Granting Leave, Hearsay

Facts:

The appellant and his ex-wife have two children, who were apprehended and placed in the care of the Children's Aid Society of Toronto. The appellant commenced a Status Review for a Crown ward and sought access to his children. He failed to attend court and, consequently, the motions judge dismissed the Status Review application. The judge also ordered that the appellant could not bring a further Status Review Application without leave of the court. The appellant brought multiple motions seeking leave, all of which were dismissed without prejudice. In May 2015, the appellant brought a further motion for leave which was dismissed by the motion judge. The appellant then appealed the dismissal of his leave motion of the Superior Court of Justice. His appeal was dismissed.

The appellant appeals the decision dismissing his appeal of the order of the motions judge denying him leave to bring a Status Review application.

Issues:

Did the appeal judge make a reversible error when she referred in her reasons to the children as girls? Did the appeal judge misapprehend a letter from the Jamaican Canadian Association? Have the appellant's ss. 7, 15 and 28 rights of the Charter of rights been breached because he was denied a Legal Aid ("LAO") certificate for the purposes of this appeal? Did the appeal judge err in applying the test for granting leave to bring a Status Review application? Holding: Appeal dismissed.

Reasoning:

(1)The Court acknowledged that the appeal judge referred to the children as "girls" in two parts of her endorsement, when, in fact, one child was a boy. However, the Court found that these were mere factual slips and did not warrant appellate intervention.

(2)Even if the motions judge had considered the letter, it would not have changed the outcome of the motion. The letter does not impact the analysis of whether the appellant has put forward a prima facie case. Furthermore, the appeal judge did not err in describing the letter as hearsay as it was an opinion by an author who was not qualified as an expert.

(3)There was no breach of the appellant's Charter rights, as the subject matter of the appeal was an application for leave to bring a Status Review application and not the Crown wardship order. It is within the purview of LAO to assess the appellant's eligibility for a certificate in...