Top 5 Civil Appeals From The Court Of Appeal (June 2014)

1. Rajmohan v. Norman H. Solmon Family Trust, 2014 ONCA 352 (Juriansz, Tulloch and Strathy JJ.A.), May 5, 2014

2. Virc v. Blair, 2014 ONCA 392 (Cronk, Pepall and Strathy JJ.A.), May 14, 2014

3. Boucher v. Wal-Mart Canada Corp, 2014 ONCA 419 (Hoy A.C.J.O., Laskin and Tulloch JJ.A.), May 22, 2014

4. Mandeville v. The Manufacturers Life Insurance Company, 2014 ONCA 417 (Gillese, Blair and Strathy JJ.A.), May 22, 2014

5. Bulut v. Carter, 2014 ONCA 424 (Juriansz, Epstein and Pepall JJ.A.), May 23, 2014

1. Rajmohan v. Norman H. Solmon Family Trust, 2014 ONCA 352 (Juriansz, Tulloch and Strathy JJ.A.), May 5, 2014

   In this brief decision, the Court of Appeal considered the doctrines of fraudulent concealment and special circumstances.

   The appellant, the assignee of mortgages granted by Rajmohan to the late Norman Solmon, brought a third party claim against the estate trustee of Chandran, a solicitor who acted for Solmon as well as the mortgagors on the transaction. On a motion for summary judgment, the motion judge dismissed the appellant's claim on the basis that it was time-barred by s. 38(3) of the Trustee Act, R.S.O. 1990, c. T.23, which provides that an action against an executor or administrator of a deceased person shall not be brought more than two years after the death of the deceased. The appellant filed its claim alleging solicitor's negligence more than two years after Chandran's death.

   The parties agreed at the motion that the Trustee Act would bar the appellant's third party claim unless either the doctrine of fraudulent concealment or the doctrine of special circumstances applied. The motion judge determined that neither applied.

   The Court of Appeal found that the motion judge made no reversible error in concluding that the doctrine of fraudulent concealment did not apply in the circumstances of the case. The motion judge carefully considered the elements which must be established in order to satisfy the doctrine, which the Court defined in Giroux Estate v. Trillium Health Centre, (2005), 74 O.R. (3d) 341 (C.A.), aff'g (2004), 69 O.R. (3d) 689 (S.C.J.) as preventing "unscrupulous defendants who stand in a special relationship with the injured party from using a limitation provision as an instrument of fraud." While she found that the solicitor-client relationship between Solmon and Chandran qualified as a "special relationship" within the meaning of Giroux and that Chandran's omissions amounted to concealment of the plaintiff's right of action, the motion judge concluded that the unconscionability requirement was not met. In her view, Chandran's conduct was negligent, but fell short of being unconscionable.

   The appellant submitted on appeal that Chandran's negligent conduct was a breach of his fiduciary duties to Solmon, notably his failure to obtain Solmon's written consent to the dual retainer and to the advancement of the mortgage funds despite the conditions not being met. This breach of fiduciary duty rendered Chandran's conduct unconscionable. The Court found that this claim failed in light of the motion judge's conclusion that Solmon likely gave verbal approval to both the dual retainer and the advancement of the funds. Having made these findings - which were based on an established working relationship between Chandra and Solmon and on Solmon's familiarity with these types of transactions - it was open to the motion judge to characterize Chandran's conduct as negligent but not unconscionable and, by extension, to conclude that the doctrine of fraudulent concealment did not apply.

   Citing the recent decision of the Supreme Court in Hryniak v. Mauldin, 2014 SCC 7, the Court emphasized the principle that deference be afforded a motion judge's findings of fact and findings of mixed fact and law made on summary judgment.

   The appellant also argued that pursuant to the doctrine of special circumstances, it should be permitted to bring its third party claim against the respondent after the expiration of the limitation period because the plaintiff's action was commenced within two years of Chandran's death. The Court rejected this submission. The Court noted that the applicable limitation period was not found in the Limitations Act, 2002, S.O. 2002, c. 24, Sch. B, but was proscribed by the Trustee Act. In any event, a third party claim is characterized as an action under the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, s. 1.03(1) and, pursuant to its decision in Joseph v. Paramount Canada's Wonderland, 2008 ONCA 469, 90 O.R. (3d) 401, the doctrine of special circumstances does not allow a party to commence a third party claim after the expiration of a limitation period.

2. Virc v. Blair, 2014 ONCA 392 (Cronk, Pepall and Strathy JJ.A.), May 14, 2014

   Michael Blair brought a summary judgment motion seeking to dismiss an application brought by his former wife Patricia Anne Virc to set aside their separation agreement. The motion judge granted the motion and dismissed Virc's application. Virc's appeal raised issues concerning the enforceability of domestic contracts in the face of insufficient financial disclosure, undue influence and duress. Perhaps most interesting, this appeal prompts consideration of the scope of a judge's power on a summary judgment motion and whether the expanded powers given a judge on a Rule 20 motion ought to be available in the family law setting.

   Virc challenged the validity of the separation agreement on several grounds, most notably that Blair's financial disclosure contained errors and omissions. Citing the imbalance in their financial bargaining power, she also claimed that Blair exercised undue influence over her and that she executed the agreement under duress. In addition, she argued that the agreement was unenforceable because her signature was not witnessed when she executed the agreement but rather two days later by a co-worker of the respondent who claimed to recognize her signature.

   On the respondent's motion, the judge proceeded by applying Rule 16 of the Family Law Rules, O. Reg. 114/99, which governs summary judgment motions in family law matters. She determined that, unlike Rule 20 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, which concerns civil proceedings generally, Rule 16 precluded her from assessing credibility, weighing the evidence, or drawing factual conclusions. She then turned to s. 56(4) of the Family Law Act, R.S.O. 1990, c. F.3 as amended, which provides that a court may set aside a domestic contract if a party failed to disclose significant assets, significant debts or other liabilities existing when the contract was made, if a party did not understand the nature or consequences of the contract, or otherwise in accordance with the law of contracts. She noted the two-step process outlined by the Court of Appeal in LeVan v. LeVan, 2008 ONCA 388, 90 O.R. (3d) 1, whereby the court must determine first whether one of the circumstances in s. 56(4) applies and then whether it ought to exercise its discretion to set aside the contract.

   The motion judge found that the question of whether Blair's misrepresentations were deliberate could not be determined on summary judgment based on the constraints on her ability to evaluate credibility. She therefore accepted the facts advanced by the appellant for the purposes of the motion, proceeding on the assumption that Blair had deliberately and materially misrepresented the value of his date of marriage property and that Virc's equalization payment may have been substantially less than her entitlement. Nonetheless, she concluded that there was no genuine issue for trial relating to the setting aside of the separation agreement because, despite having access to and knowledge of her husband's financial records and affairs, the appellant signed the agreement without questioning his disclosure. The motion judge relied on the Court of Appeal's decisions in Armstrong v. Armstrong, (2006), 32 R.F.L. (6th) 244 (Ont. C.A.), Butty v. Butty, 2009 ONCA 852, 99 O.R. (3d) 228 and Farquar v. Farquar (1983), 43 O.R. (2d) 423 (C.A.), finding that they impose an onus on the recipient of information to question it if she does not accept its veracity. The motion judge held that a reasonable person would have...