Ontario Court Of Appeal Summaries (September 9 – 13 2019)

Good afternoon.

It was a fairly busy week at the Court of Appeal, with the Court releasing twelve civil decisions, nine criminal and provincial offences decisions, and one Ontario Review Board decision.

Areas of law covered this week included agreements of purchase of sale of land, limitation periods, automobile insurance, personal injury, family, estates, contracts, employment and vexatious litigants.

Perhaps the most noteworthy decision of the week was Langenfeld v. Toronto Police Services Board. In that case, the Court overturned the decision below and held that the security measures put in place by Chief Saunders at the entrance to Toronto Police headquarters, while violating freedom of expression, were reasonable limits and justified under the Oakes Test.

Aviva Insurance Company v. Wawanesa Mutual Insurance Company was a priority dispute between two automobile insurers. The accident involved a rental car. Priority hinged on whether the car was rented by an employee on his own behalf, or on behalf of an employer. The Court determined that the application judge had erred in determining that the car had been rented by the employee on his own behalf. To determine the identity of the true lessee, it was necessary to look at all the surrounding circumstances, and not just the face of the rental agreement.

Faiello v. Faiello involved an appeal from a decision to award spousal support in the face of a support waiver in the parties' Separation Agreement, while not disturbing the provisions of the Agreement relating to property.

Finally, congratulations to our very own Varoujan Arman for successfully acting for the respondent in Dorr Capital Corporation v. Kingwood River Walk Homes Limited (Kingwood Homes). The issue in the case involved fees earned and payable under a loan agreement.


Lin v. Brookfield Homes (Ontario) Limited, 2019 ONCA 706

[Strathy C.J.O., MacPherson and Tulloch JJ.A.]


Rebecca Huang and Zina Rita, for the appellant Neil G. Wilson and Yolanda Song, for the respondents


The Appellant signed an Agreement of Purchase and Sale ("APS") to buy a pre-construction condominium detached house unit from the Respondent. On the closing date, the Appellant's solicitor wrote to the Respondent's solicitor reserving the right to rescind the agreement as a result of the material change to the disclosure documentation. The alleged material change was that construction of a number of common elements had not begun including the parkette and the entrance/exit gates. The Respondent's solicitor advised that there was no material change in the disclosure statement and that, as a result of the Appellant's failure to complete the transaction on the closing date, the Respondent was terminating the APS, forfeiting the Appellant's deposit, and reserving its right to exercise other remedies.

The Appellant commenced an application, seeking return of her deposit. The Respondent commenced an application, seeking, inter alia, a declaration that the Appellant breached the APS by failing to close, that the Appellant was not entitled to a return of her deposit, and that the Respondent was entitled to claim additional damages for that breach. The application judge dismissed the Appellant's application for return of her deposit, allowed the Respondent's application and ordered a trial of the issue of the quantum of damages.


(1) Did the application judge err in her interpretation of the purchaser's right of rescission under the Condominium Act, 1998?

(2) Did the application judge err by finding that the entry and exit gates were "amenities", rather than essential features of the community?

(3) Did the application judge commit a palpable and overriding error in finding that the Respondent intended to build a gated community "as of the closing date"?

(4) Did the application judge err by relying on section 21 (Default) of the APS to allow the Respondent to retain the Appellant's deposit after she refused to close the transaction.


Appeal dismissed.


(1) No. The Court held that the non-construction, at that point, of the parkette and entry and exit gate was not a material change in circumstances within the meaning of s. 74 of the Condominium Act, 1998.

(2) No. The APS stated that "the Purchaser acknowledges that failure to complete [...] the common elements on or before the Occupancy Date shall not be deemed to be a failure to complete the unit." The Court concluded that the gates were common elements and the timing of the construction of the gates was not a material change.

(3) No. Given the relevant language of the APS, the Court held that time was not of the essence with respect to the gate construction.

(4) No. The Appellant based this ground of appeal on the argument that the Respondent did not plead section 21 of the APS. The Court held that the Respondent pleaded the APS, of which section 21 was an obvious provision in a residential property case.

1179 Hunt Club Inc. v. Ottawa Medical Square Inc, 2019 ONCA 700

[Hoy ACJO, Lauwers, and Zarnett JJ.A.]


Elliot Birnboim and Michael Crampton, for the appellant Anne Tardif, for the respondents


The respondent agreed to buy commercial condominium units from the appellant vendor but the transaction did not close. The appellant applied for a declaration that the respondent had anticipatorily breached the agreement of purchase and sale and that it was entitled to retain the deposit, that the appellant was free to pursue damages and that AM was liable for any damages as guarantor of the respondent. The application judge ruled that the agreement came to an end when both parties were unable to close the transaction on the closing date and required that the appellant return the deposit to the respondent. The appellant vendor appealed.


(1) Did the purchaser anticipatorily repudiate the agreement?

(2) If so, did such repudiation excuse the vendor from its obligation to be ready, willing, and able to close the transaction on the closing date?

(3) Did the guarantee clause in the agreement bind the signatory AM personally?


Appeal dismissed.


(1) Yes. A mere request for an extension of time would not ordinarily amount to anticipatory repudiation. However, the request for an extension was tied to a lack of financing to complete the transaction. The respondent moved into the state of being in anticipatory breach of the agreement when it did not undertake to close on the appointed date upon learning of the appellant's refusal to extend the time. The application judge erred in concluding that the respondent did not anticipatorily repudiate the agreement.

(2) No. The application judge found that the respondent elected to insist on performance of the agreement in accordance with the decision in Domicile Developments Inc v MacTavish, (1990), 45 OR (3d) 302 (CA). This, she ruled, kept the agreement of purchase and sale alive for the time being. The application judge then found that the evidence failed to establish that the respondent was ready, willing, and able to close on the closing date. The decision in Kwon v Cooper (1996), 89 OAC 239 (CA) establishes that if a vendor insists on closing on a certain date and subsequently fails to be ready, willing, and able to close as scheduled, the contract comes to an end. The appellant vendor's failure to be able to close was fatal; "he who seeks equity must do equity." The agreement was terminated and the purchaser is entitled to a return of the deposit.

(3) The contra preferentem rule was correctly applied by the application judge in deciding that the agreement did not contain a personal guarantee by AM and even if it did, the agreement had come to an end and AM was not a party to the new agreement entered into by the parties after one at issue came to an end.

Aviva Insurance Company v. Wawanesa Mutual Insurance Company, 2019 ONCA 704

[Feldman, Paciocco and Fairburn JJ.A.]


Dennis Ong and Christopher Scotchmer, for the appellant Steven Carlstrom and Genevieve Durigon, for the respondent


This is an appeal from the order of the application judge declaring Aviva the first loss insurer under s. 277 of the Insurance Act.

The plaintiff brought an action after being rear-ended by a rental vehicle, which the driver used to make deliveries for his employer. The plaintiff sued the driver, the rental company and the employer. The driver was uninsured but the rental company and his employer both had insurance. The insurers for the rental company and the employer, Aviva Insurance Company ("Aviva") and Wawanesa Mutual Insurance Company ("Wawanesa") respectively, could not agree upon their insurance obligations.

When the driver was first hired, he signed a subcontract agreement at the request of his employer which required him to arrange his own insurance. The driver signed the subcontract agreement but claimed he did not understand the terms. The driver also signed the car rental agreement wherein he was listed as both the renter and driver. The employer was not mentioned in the rental agreement. However, the employer had a standing agreement with the rental company under which the employer authorized the rental company to charge the cost of vehicle rentals directly to a card on file. Notably, the driver was not permitted to use the rental vehicles for any other purpose than to make deliveries for his employer.

Pursuant to s. 277 of the Insurance Act, when a rental vehicle is involved in a collision and there is overlapping liability coverage, the identity of the first loss insurer depends on the identity of the lessee. Specifically, s. 277 provides that any policy under which the lessee is entitled to indemnity must respond first, followed by that of the driver and then of the owner. Aviva argued that the employer leased the car and therefore the employer's insurer, Wawanesa, should be first to pay. Conversely, Wawanesa claimed the driver was the lessee...

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