Court Of Appeal Summaries (February 21-24, 2017) - Civil Law

Following the Family Day long weekend, it was a relatively light week for the Ontario Court of Appeal's release of decisions. Below are the summaries for this week's civil decisions. Topics covered included family law, employment law, and the treatment of contingency fee agreements in the context of infant settlements.

Perhaps the most interesting decision of the week was the decision Wood v. Fred Deeley Imports Ltd. In this case, the Court of Appeal addressed the enforceability of an employment agreement under the Employment Standards Act and whether a termination clause contravened the Employment Standards Act.

Civil Decisions:

Wood v. Fred Deeley Imports Ltd., 2017 ONCA 158

[Laskin, Feldman and Hourigan JJ.A.]

Counsel:
E. Meehan, Q.C., D. A. Lublin and M. W. Kitay, for the appellant
A. Khan and S. P. Morley, for the respondent

Keywords: Employment Law, Termination Clause, Unenforceable, Ontario's Employment Standards Act,

Facts:

The respondent, Fred Deeley Imports, was the exclusive Canadian distributor for Harley-Davidson motorcycles, parts, apparel and accessories. In April 2007, Deeley hired the appellant, Julia Wood, as a Sales & Event Planner. Eight years later, at the end of April 2015, Harley-Davidson Canada entered into an agreement with Deeley to buy all of its assets. As a result of the buyout, Deeley immediately told all of its employees, including Wood, that their employment would terminate on August 4, 2015.

By the date of termination, Wood had worked for Deeley for eight years and four months. Her last annual compensation, including benefits, was approximately $100,000. When her employment ended, she was 48 years old. Wood signed an employment agreement the day after she started working for Deeley in 2007. The agreement contained the termination clause at issue in this appeal, including the following:

[The Company] is entitled to terminate your employment at any time without cause by providing you with 2 weeks' notice of termination or pay in lieu thereof for each completed or partial year of employment with the Company. If the Company terminates your employment without cause, the Company shall not be obliged to make any payments to you other than those provided for in this paragraph.... The payments and notice provided for in this paragraph are inclusive of your entitlements to notice, pay in lieu of notice and severance pay pursuant to the Employment Standards Act, 2000 ("ESA").

Deeley paid Wood her salary and benefits for her 13 weeks of working notice (May 1 to August 4, 2015). Deeley also paid her additional compensation, including a lump sum equivalent to eight weeks' pay. Nonetheless, Wood started an action against Deeley and brought a motion for summary judgment. She contended that the entire employment agreement was unenforceable, and, in the alternative, that the termination clause was unenforceable. She asked for damages equivalent to 12 months' notice of termination.

The motion judge dismissed Wood's motion and held that both the employment agreement and the termination clause were enforceable. But he also held that if he was wrong, Wood would be entitled to damages equal to her salary and benefits for a reasonable period of notice. In his view, reasonable notice was 39 weeks (nine months).

Issues:

Is Wood's employment agreement unenforceable because she signed it after she started working and was not provided with fresh consideration?
Does the termination clause contravene the ESA because it excludes Deeley's statutory obligation to make benefit contributions during the notice period and it does not satisfy Deeley's statutory obligation to pay severance pay?
Did the motion judge err by fixing the period of reasonable notice at nine months?

Decision:

Appeal allowed. Effect was given to the Appellant's argument on the second issue.

Reasoning:

(1) Is Wood's employment agreement unenforceable?

The court found that a written employment agreement is not unenforceable merely because the employee signs it after starting to work. A written employment agreement might well be unenforceable if an employer includes in it a material term that was not part of the original employment relationship, but Deeley did not do so in this case.

The motion judge inferred that the terms of Wood's employment with Deeley were contained in the email and that she received the email before she started working on April 23, 2007. The motion judge's inferences were reasonable. In her evidence, Wood never claimed that on April 24, 2007, she was seeing her employment agreement for the first time. Nor did she claim that the agreement she signed contained any additional material term. Simply signing the agreement the day after she started working was no doubt a matter of administrative convenience. As Deeley did not unilaterally impose a new term of her employment, fresh consideration was not required. The court would not give effect to this ground of appeal.

(2) Does the termination clause contravene the ESA because it excludes Deeley's statutory obligation to make benefit contributions during the notice period and it does not satisfy Deeley's statutory obligation to pay severance pay?

At common law, an employee hired for an indefinite period can be dismissed without cause, but only if the employer gives the employee reasonable notice. In Machtinger v. HOJ Industries Ltd., the Supreme Court characterized the common law principle of termination of employment on reasonable notice "as a presumption, rebuttable if the contract of employment clearly specifies some other period of notice".

Ontario employers and employees can rebut the presumption of reasonable notice by agreeing to a different notice period. But their agreement will be enforceable only if it complies with the minimum employment standards in the ESA. If it does not do so, then the presumption is not rebutted, and the employee is entitled to reasonable notice of termination. Deeley and Wood did agree to a different notice period. Thus, the main question on this appeal is whether the termination clause they agreed to contravenes the ESA. Wood submits that the clause does contravene the ESA because it excludes Deeley's statutory obligation to contribute to Wood's benefit plans during the notice period and does not clearly satisfy Deeley's statutory obligation to pay severance pay on termination.

The question of the enforceability of the termination clause turns on the wording of the clause, the purpose and language of the ESA, and the jurisprudence on interpreting employment agreements. The Supreme Court stated in Reference re Public Service Employee Relations Act (Alberta), [1987] 1 S.C.R. 313, as important as employment itself is the way a person's employment is terminated. The court noted that it is on termination of employment that a person is most vulnerable and thus is most in need of protection (per Wallace v. United Grain Growers Ltd., [1997] 3 S.C.R. 701).

Wood's compensation included Deeley's contributions to her two benefit plans. Under ss. 60 and 61 of the ESA, Deeley was required to continue to make those contributions during the notice period, and the obligation to do so was an employment standard under the ESA. On its plain wording, the termination clause excludes Deeley's obligation to contribute to Wood's benefit plans during the notice period. Accordingly, the court found the termination clause unenforceable.

Because the clause is void, it cannot be used as evidence of the parties' intention. It would therefore be wrong to infer that the parties would have intended to substitute a clause that complied with the ESA.in lieu of the void termination clause.

(3) Did the motion judge err by fixing the period of reasonable notice at nine months instead of 12?

The motion judge's figure of nine months took account of the relevant factors and was within a reasonable range. Even though he found the agreement enforceable and thus did not need to determine reasonable notice, his determination is still entitled to deference on appeal.

In finding that the period of reasonable notice was nine months, the motion judge took into account the well-established Bardal factors: the character of Wood's employment, her length of her service, her age, and the availability of similar employment in the light of her experience, training, and qualifications. The motion judge also noted Wood's submission that though her position was "clerical" – she had no managerial duties – her high income together with her age would make it more difficult for her to find a new, but comparable job.

The motion judge considered the case law presented by both parties on comparative dismissals, relied on the case law submitted by Wood, and concluded that a reasonable range of notice was 8.5 to 11 months. Within that range, he chose nine months. The court could not say that nine months was outside a reasonable range deferred to the motion judge's determination.

St. Jean v. Armstrong, 2017 ONCA 145

[MacFarland, van Rensburg and Huscroft JJ.A.]

Counsel:
G. Adair, Q.C., and K. E. Cullin, for the appellant Cindy St. Jean
No one appearing for the respondents

Keywords: Endorsement, Torts, Settlement, Costs, Fees and Disbursements, Contingency Fee Agreement, Accident Benefits Claim

Facts:

This appeal relates to a motion for approval of an infant settlement reached in two proceedings. The appeal is by the lawyers who represented the plaintiffs, and specifically the lawyers appeal the motion judge's decision to reduce their fee on the accident benefits claim (the "AB claim"), to not award them GST/HST (which they claim at a "prorated" rate of 8%), and to reduce the amount claimed for fees. The lawyers also appeal the motion judge's refusal to grant a sealing order, and his refusal to refer the issue of their fees to an assessment officer. At the outset of argument, Mr. Adair, on behalf of the lawyers, abandoned the appeal in relation to the sealing order and did not make any argument in relation to the assessment point.

The facts of the motor vehicle accident giving rise to this matter involved an infant plaintiff that suffered a traumatic brain injury. The lawyers were retained shortly after the accident to act in relation the tort and accident benefits claims. In July, 2006, about two years post-accident, the plaintiffs signed a contingency fee agreement (CFA).

Both actions ultimately settled before trial. The global settlement, inclusive of costs, was $1,719,510.00. In accordance with the CFA counsel sought fees in the amount of $466,000.00 plus GST/HST of $37,280 plus disbursements of $84,510.00 for a total of $587,790.00.

The motion judge requested and received further information "to substantiate the claim for one third of the AB Claim". He met with counsel twice and ultimately held a hearing on December 18, 2014. He reviewed the jurisprudence in relation to CFAs and particularly in relation to that involving claims both in tort and for accident benefits.

The motion judge approved the CFA in relation to the tort claim and approved the agreement in relation to that claim. He allowed fees in the sum of $183,333.00 but made the amount inclusive of HST. This amount reflected one third of the $550,000.00 amount allocated for damages. He then reduced the amount sought for legal fees in relation to the AB claim from $280,500.00 to $170,000.00 again, such figure to be inclusive of HST. There was no issue in relation to the disbursements which were allowed as claimed.

In his reasons, the motion judge considered the nature of each of the distinct claims made. He pointed out the difficulty he had in relation to the reconstructed docket entries. He accepted the distinction in the jurisprudence between tort and accident benefit claims and contrasted the risk assumed by the firm in the tort claim compared to the relative lack of risk on the AB claim.

When the lawyers raised the fee and disbursement issues with the motion judge after the release of his reasons and asked that he amend this finding, the motion judge considered that he was functus at that point and accordingly the issue was left for the Court of Appeal.

Issues:

Did the motions judge err in his consideration of the claims?

Did the motions judge err in considering the tort and AB claims distinctly?

Should the motions judge have looked at the "big picture" and considered the claimed amount for fees of $466,000.00 in relation to the total amount of the settlement for damages which was $1,400,000.00 in both claims?

Did the motions judge err in not awarding the plaintiff's lawyers GST/HST?

Decision:

The judgment is amended in accordance with these reasons. In all other respects the appeal is dismissed.

Reasoning:

No, the motions judge did not err in his consideration of the claims. While Mr. Adair emphasized the excellent result achieved by counsel in having achieved an overall settlement in excess of $1.7 million dollars, and stressed the "high risk" nature of the tort claim, the length of time counsel's firm carried the case (some eight years before settlement was reached) and the high disbursements carried by the firm, none of this was lost on the motions judge. While there was risk in the tort claim, there was little risk in the AB claim. The plaintiff was covered under the policy, and while there were some differences over the amount to be paid for attendant care benefits, payments were made and the claim was ultimately settled after pleadings. Accordingly, the court agreed with the motions judge that the AB claim did not entail the sort of risk and complexity that the tort claim did.

No, the motions judge did not err in considering the tort and AB claims distinctly. Before the motion judge, counsel took that approach and sought to be paid on that basis of one third of the $550,000.00 allotted to the damages in the tort claim and one third of the $850,000.00 for the AB claim. In the court's view, it was not an error for the motion judge to consider the fee claims for the tort action and the AB action separately. The claims were different with different risks associated with each of them.

No, it was not inappropriate for the motion judge to not look at the "big picture" when considering the quantum of fees. It was appropriate for the motions judge to treat these matters as he did, especially given that it was the way counsel presented it to him. Every case must be considered on its own particular facts and the court was satisfied the motion judge carefully considered the issues raised in relation to this settlement and, refused to interfere with his overall conclusion.

Yes, the motions judge erred on the issue of tax. The contingency fee agreement does clearly say that the lawyers were to be paid one third of any settlement plus GST and disbursements. The motion judge fixed the fees (which were percentage calculations) inclusive of HST. He approved the CFA in relation to the tort claim and accordingly the GST/HST on those fees ought to have been paid to the lawyers in addition to the fee amount. The GST/HST at the prorated rate of 8%, on fees of $183,333.00 is $14,666.64. Similarly, although he reduced the fee on the AB claim to $170,000.00, the lawyers should have the GST/HST of $13,600.00.

Ralhan v. Singh, 2017 ONCA 147

[MacFarland, van Rensburg and Huscroft JJ.A.]

Counsel:
L.C. Talbot for the appellant/respondent
No one for the respondent/applicant

Keywords: Endorsement, Matrimonial, Contempt, Access to Children, Mandatory Counselling, Restraining Order

Facts:

Appellant was found in contempt in relation to an earlier access order. Appellant appealed both the finding of contempt and the penalty imposed. The finding was based on the appellant's failure to comply with the order granting the respondent access to the children on two consecutive occasions. The trial judge found the appellant in contempt, and ordered him to pay $10,000 and undergo counselling along with the respondent and the children.

Issue:

Did the trial judge err in the finding of contempt or the penalty imposed?

Decision:

Appeal allowed in part to remove the requirement that the appellant attend at counselling with the respondent and the children.

Reasoning:

It was open to the judge to make the finding of contempt, and to disbelieve the appellant as to the reasons he gave for preventing the respondent from accessing the children. However, regarding the order that the parties attend counselling together, the court noted that there was a restraining order preventing the Appellant from being within 500 metres of where the respondent is exercising her access to the children. This restraining order was made given the many allegations of abuse in the record. The counselling order was not in the best interests of the children, and it was an error of law to order what appears to be joint counselling in the face of the restraining order. The order was varied to require the Appellant to instead "attend and co-operate with the counselling process".

Family and Children's Services of the Waterloo Region v. K.F. (Publication Ban), 2017 ONCA 157

[Pardu J.A. (In Chambers)]

Counsel:
G. Ichim, for the appellant
J. Boich, for the respondent

Keywords: Endorsement, Interim Access, Crown Wardship, Child and Family Services Act

Facts:

The appellant K.F. moved for interim access pending the hearing of an appeal to the Court of Appeal.

On the underlying application, the appellant's son was apprehended at 8 weeks of age, and was made a Crown ward, without access. The application judge accepted the expert testimony that the quality of the appellant's parenting was hampered by her mental health issues, which made the appellant lack insight into Z.A.F.'s emotional and developmental needs. The appellant had also exposed Z.A.F. to adult conflict between her and her partners. After concluding that the child's best interests required a Crown wardship order, the application judge held that there was no basis for an access order.

The appellant appealed this decision to a judge of the Superior Court. While that appeal was ultimately unsuccessful, the appellant had been awarded limited supervised access pending the appeal.

Issue:

Should interim access to the child be provided to the appellant pending the hearing of the appeal?

Decision:

There should be no interim access pending appeal.

Reasoning:

Section 59(2.1) of the CFSA sets out the conditions which must be satisfied before an access order can be made in favour of a parent, following an order for Crown wardship. Once a decision is made for Crown wardship, the burden of persuading a court that an access order should be made, and that the statutory conditions are met, is on the parent seeking access. Although the onus to show a serious issue on the appeal (which could result in an interim access order) was not a heavy one, the court did not believe there was a substantial ground of appeal raised.

Only a month had elapsed since a good-bye visit. The Court was not persuaded that recommencing visits were in the child's best interests or that the child will suffer irreparable harm if there is no access until the appeal was decided. The Court gives priority to appeals from decisions making Crown wardship orders, and the appeal was anticipated to be heard within months. In the event the appellant succeeds on appeal in obtaining an order for access to her child, the Court was not satisfied that the delay in the resumption of access would be traumatic for the child given the nature of their relationship.

Malik v. Malik, 2017 ONCA 163

[LaForme, Pepall and Pardu]

Counsel:

D. Malik, in person
A. Abramian, for the respondent

Keywords: Endorsement, Family Law, Support, Spousal Support, Child Support, Equalization, Expenses

Facts:

The central question for the trial judge was whether the appellant was a man of modest means, unable to earn a living due to disability and advancing age, or was he running a successful, lucrative business, the extent of which he had taken pains to conceal?

The trial judge made extensive findings of fact and credibility against the appellant, including: he earned enormous sums of money through an "improper insurance scheme"; and concealed those amounts from his wife and from the court. The trial judge ordered equalization pursuant to a consent of the parties, child and spousal support arrears, and s. 7 expenses. The trial judge awarded full recovery of some of her costs given the appellant's bad faith (those costs relating to financial disclosure), and partial recovery for the balance of her costs..

Issues:

Did the trial judge: (i) ignore the appellant's documented medical conditions in finding him able to pay child and spousal support; (ii) ignore the respondent's failure to disclose relevant assets; (iii) erroneously grant the respondent child support despite her never suffering economic disadvantage from the marriage; (iv) err in denying the appellant occupation rent after leaving the family home; and (v) make errors in her reasoning on costs.

Did the trial judge err in the calculation of an equalization payment?

Decision:

Appeal dismissed.

Reasoning:

No. There was no basis on which to interfere with the trial judge's findings of fact or the exercise of her discretion. The trial judge found the appellant acted in bad faith, yet significantly curtailed the scope of her finding and ordered full recovery costs only in respect of certain issues. She imputed income to him based on his clandestine corporate revenues, yet went on to reduce those revenues in accordance with the expenses he incurred to operate his "questionable" insurance scheme. Further, the trial judge limited herself to imputing income based on the appellant's corporation's revenues, despite there being evidence in the record that he also used his parent's accounts to shield profits from his various business endeavours. The trial judge could have imputed a higher income. The appellant did not direct the court to any error of fact or law in the trial judge's decisions.

No. The equalization payment was negotiated with the benefit of counsel and was based in part on the information provided by an OMERS pension plan administrator. There was nothing before the court that gave effect to this ground of appeal or to accept the other challenges to the respondent's financial statement raised.

Civil Endorsements:

Linderwood Holdings Inc. v. Armanasco, 2017 ONCA 156

[MacFarland, van Rensburg and Huscroft JJ.A]

Counsel:
R.C.M. Belsito, for the appellants
M. A. Katzman, for the respondent

Keywords: Endorsement, Real Estate, Power of Sale, Bad Faith, Relief, Improvident Sale Action

Szymanski v. Alaimo, 2017 ONCA 151

[Doherty, Brown and Miller JJ.A]

Counsel:
C. A. Muccilli, for the appellant
G. L. Adrian, for the respondents

Keywords: Endorsement, Costs

Criminal Decisions:

R. c. Simard, 2017 ONCA 149

[Les juges Sharpe, Rouleau et Benotto]

Counsel:
C. Mainville, pour les appelants Nicolas Simard et Sébastien Lépine
V. Goela, pour l'intimée

Keywords: Criminal Law, Controlled Drugs and Substances Act, s. 7(2)(b), Mandatory Minimum Sentence, Aggravating Factors, Guilty Plea, Linguistic Deficit, Ineffective Legal Assistance

R v Stark (Publication Ban), 2017 ONCA 148

[Doherty, Blair and Lauwers JJ.A.]

Counsel:
E. Chozik, for the appellant
D. Bonnet, for the respondent

Keywords: Criminal Law, Sexual Assault, Mode of Trial, Election, Criminal Code, s.536, Ineffective Assistance

R. v. Cameron, 2017 ONCA 150

[Doherty, Laskin and Roberts JJ.A.]

Counsel:
L. Greenspon and E. Granger, for the appellant
J. Barrett, for the respondent

Keywords: Criminal, First Degree Murder, Unfair Trial, Miscarriage of Justice, Crown's Closing Address, Browne v. Dunn (1894), H.L. 67 (C.A.), Corrective Instructions

R. v. Perkins, 2017 ONCA 152

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

Counsel:
J. Penman and K. Heath, for the appellant/applicant
C. Bartlett-Hughes, for the respondent

Keywords: Criminal, Sexual Assault, Voyeurism, Sentence Appeal, Reopen, Change in Circumstances, Jurisdiction, R. v. Rhingo (1997), 115 C.C.C. (3d) 89 (Ont. C.A.), Criminal Code, s. 683(3), Rules of Civil Procedure, rule 69.06(2)(a), Interests of Justice

R v Sheahan, 2017 ONCA 159

[Hoy A.C.J.O., Doherty and Miller JJ.A]

Counsel:
D. M. Garg, for the appellant
E. Granger and L. Greenspon, for the respondent

Keywords: Endorsement, Criminal, Summary Conviction Appeal Court, Standard of Review, Impaired Driving, Criminal Code, s. 253(1)(b)

R. v. Badour, 2017 ONCA 160

[Cronk, Rouleau and Miller JJ.A]

Counsel:
R. J. McGowan, for the appellant
K. Beaudoin, for the respondent

Keywords: Endorsement, Criminal, Aggravated Assault, Self-defence

Williams (Re), 2017 ONCA 161

[Cronk, Rouleau and Miller JJ.A.]

Counsel:
A. Szigeti and T. Mimnagh, for the appellant
K. Farrell, for the respondent

Keywords: Endorsement, Ontario Review Board, Not Criminally Responsible, Mental Disorder, Risk to Public, Custodial Order

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Canada: Court Of Appeal Summaries (February 21-24, 2017)

TABLE OF CONTENTS:

Civil Decisions:

Criminal Decisions:

Canada: Court Of Appeal Summaries (February 21-24, 2017)

TABLE OF CONTENTS:

Civil Decisions:

Criminal Decisions:

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