I hope everyone is surviving the freezing rain storm!
In Nodel v. Stewart Title Guaranty Company, 2018 ONCA 341, the title insurer, Stewart Title, sought to avoid coverage for a mortgage fraud on the basis of an exclusion that purported to exclude coverage for funds that were "paid to any person other than the registered title holder." The mortgage funds were delivered to the title holder's lawyer in trust, rather than the title holder himself (as in every mortgage transaction), and the title insurer had denied coverage on that basis. LawPro settled with the plaintiff on behalf of the lawyers involved, and brought the motion for coverage against Stewart Title. The Court of Appeal sensibly held that the exclusion did not apply, as payment of the funds to the title holder's lawyer was the same thing as paying them to the title holder directly.
In Wallbridge v. Brunning, the Court of Appeal held that whether a law firm can be vicariously liable for defamatory statements made by a lawyer who practices "in association" with it (as opposed to being an associate employed by the law firm or a partner of the law firm), is an issue of general importance that should be determined at a trial and not on a motion for summary judgment. It therefore set aside the motion judge's order dismissing the action against the law firm.
Other topics covered this week included several wills and estates matters, wrongful dismissal, family law (custody and abduction), limitation periods and some procedural matters.
M Todd, for the appellant
I Vacaru and R Godard, for the respondent, Prema Oza
Keywords: Wills and Estates, Proceeds of Life Insurance Policies, Revocable Beneficiaries
The appellant appeals from the order declaring that life insurance proceeds from his deceased father's life insurance policy are payable to his father's estate. The appellant's father died on November 13, 2013. The appellant is the sole trustee of his father's estate. He and his three siblings (who are respondents in the application) are the sole beneficiaries under their father's will. The life insurance policy in issue was originally issued by Metropolitan Life Insurance Company in the names of the appellant's mother and father. The appellant's mother passed away on August 14, 1998. On August 31, 1998, his father changed the beneficiary designation under the insurance policy to the appellant. The form indicates that the father made the appellant a revocable beneficiary. Metropolitan Life was subsequently acquired by Sun Life Assurance Company of Canada, and a new Sun Life policy number was assigned to the policy issued to the appellant's parents. On January 30, 2006, the appellant's father signed a Sun Life Assignment Policy Absolute in the presence of Alan Berger, his insurance agent. The Assignment provides that it has the effect of cancelling all previous beneficiary designations. The appellant was not present and was unaware of the meeting or the Assignment until after his father's death when Mr. Berger advised him that the effect of the Assignment was that the proceeds under the life insurance policy would go to his father's estate.
(1) Did the motion judge err in failing to declare that the appellant was entitled to the proceeds under his father's life insurance policy?
(1) No.The motion judge properly concluded that by executing the Assignment on January 30, 2006, the deceased father intended that the estate be the beneficiary of his life insurance policy. The Assignment was signed by the deceased in the presence of Mr. Berger, his insurance agent, and it provided that by signing, the deceased confirmed that "all previous revocable beneficiary ... appointments are cancelled." The appeal was therefore dismissed.
Anser Farooq, for the appellant
Robert McQueen, for the respondent
Keywords: Family Law, Custody and Access, Child Abduction, Best Interests of the Child, Convention on the Civil Aspects of International Child Abduction, Articles 12, 13(b), Children's Law Reform Act, R.S.O. 1990, c. C.12., s. 46(2)
The appeal relates to the orders of the application judge requiring the appellant mother to return the parties' children to their habitual residence in England for custody and access to be determined there. The orders were made pursuant to Article 12 of the Convention on the Civil Aspects of International Child Abduction ("Hague Convention"), as incorporated in s. 46(2) of the Children's Law Reform Act.
Under Article 12 of the Hague Convention, where the court determines that a child has been wrongfully removed or retained, the court shall order the return of the child forthwith. The appellant filed fresh evidence on appeal about the current status of the children and of proceedings she has started in England.
(1) Did the application judge err in awarding custody to the respondent as a consequence of the mother's breach of his order?
(2) Did the application judge err in ordering the appellant to return to England with the children?
(3) Did the application judge err in declining to assess whether the grave risk of harm override provision in Article 13(b) of the Hague Convention was engaged?
Holding: Appeal allowed.
(1) Yes. To award custody of the children to one parent as a consequence of the other parent's failure to obey a court order is an error, as it fails to consider or prioritize the children's best interests.
(2) Yes. To the extent that he did so, the application judge was without jurisdiction to order the appellant to return to England with her children.
(3) Yes. The application judge erred in stating that he could not determine whether the children were at grave risk of serious harm and then delegating this matter to the English courts. Article 13(b) of the Hague Convention requires the court to consider the possibility of grave risk of physical or psychological harm to the children arising from an order returning them to their country of habitual residence.
The appellant argued before the application judge that "the threatening, abusive and intolerable behaviour towards the [mother] by the [father], and drinking and smoking habits of the [father] reflects inability to create a safe environment free of danger for the children". She further submitted that if the children are ordered to return to England she would have to return with them and she would be returning to a dangerous situation. The appellant alleges that the respondent is physically abusive, verbally abusive, and financially controlling. The respondent denied these allegations.
A grave risk of harm to a child's mother can establish a risk to the child as well. The Court of Appeal found that it was an error for the application judge to explicitly decline to decide whether he believed allegations that, if believed, could engage the protective function of the court to decline to order the children's return. Having found that the issue of risk could not be determined on the existing record of conflicting affidavit evidence, it was incumbent on the application judge to consider whether oral evidence was required to allow him to complete his risk analysis or whether he could make a decision based on the sufficiency of the record and the appellant's evidentiary onus. He erred in doing neither and instead delegating the risk assessment to the English courts.
The Court awarded no costs of either the application below or the appeal.
Bryan Fromstein and A. Fabio Longo, for the appellant
Nawaz Tahir and Evan Banks, for the respondent Deanna E. Walsh
Keywords: Civil Procedure, Representation by Lawyer, Orders, Remedy for Breach, Setting Aside, Motions, Notice, Rules of Civil Procedure, Rule 15.04, Rule 37.14
The appellant appeals the order of Gordon J., which dismissed her action for failure to file either a notice of appointment of counsel or of an intention to act in person within 30 days of the order of Reily J. removing her former lawyer. The appellant also appeals the order of Flynn J., who heard the appellant's original motion to set aside Gordon J.'s order, but dismissed it on the basis that the proper route was to appeal Gordon J.'s order.
(1) Should the order dismissing the appellant's action be set aside?
(2) Should the second order dismissing the appellant's motion to set aside the dismissal order be set aside?
Held: Appeal allowed.
(1) Yes. The order of Reilly J. was deficient in that it did not include the text of rules 15.04(8) and (9) of the Rules of Civil Procedure, as required by r. 15.04(4). The importance of those provisions in an order removing a solicitor cannot be overstated. The obvious purpose is to bring home to the now unrepresented litigant the fact that she is required to give notice to the court and other parties to the litigation that she has either appointed alternate counsel or will be acting in person and that failure to do so can result in the court dismissing her proceeding or striking out her defence. Further, the appellant, who did not appear before Gordon J., had not been served with the respondent's motion in accordance with the Rules.
Gordon J. gave no reasons for his order and it cannot be ascertained why he ordered the most draconian remedy available in the circumstances. Accordingly, his order cannot stand. His order was set aside and substituted with an order that the appellant's action shall be dismissed if she fails to file a notice of appointment of counsel within 14 days.
(2) Yes. When the appellant learned of Gordon J.'s order she promptly moved before Flynn J. under r. 37.14 to set it aside, on the basis that she failed to appear through insufficient notice. Flynn J. concluded that her recourse was to appeal Gordon J.'s order to the Court of Appeal and dismissed her motion. It is unclear from Flynn J.'s reasons that he grappled with the threshold issue of insufficient notice within the meaning of r. 37.14. It was open to him to have granted the relief sought by the appellant. Accordingly, Flynn J.'s order is set aside.
Valve Elisabeth Aloe-Gunnell, acting in person
William R. Scott, for the respondents Lembit Peter Aloe, Toomas Erki Aloe, Alo Lumber and Building Supplies Limited, John Alo Developments Limited and Alo Construction Company Limited
Keywords: Wills and Estates, Civil Procedure, Orders, Contempt, Varying Orders, Limitation Periods, Reasonable Apprehension of Bias, Trustee Act, R.S.O. 1990, c. T.23, s. 38(3), Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, Limitations Act, R.S.O. 1990, c. L.15, Rules of Civil Procedure, Rule 59
These appeals arise in the context of long-standing litigation commenced by the appellant in respect of the business interests, bank accounts and real property of the estate of her father, Valdeko Aloe.
In 2011, the parties signed Minutes of Settlement that were incorporated into a final order of Koke J. on March 11, 2011 (the "Final Order"). Among other things, the Final Order provided for a portion of certain real property in New York to be deeded to the appellant, after severance. Shortly after the Final Order, Ms. Aloe-Gunnell repudiated the settlement after asserting that the defendants had misrepresented the value of her share of the New York property. The parties have been unable to successfully implement the Final Order since that time, and there have been multiple court attendances.
In January 2015, Varpio J. found the appellant in contempt of court after she brought proceedings in New York with respect to the New York property. The motion judge found the appellant had breached the Final Order by commencing such proceedings because Koke J. had seized himself of the matter and para. 17 of the Final Order required only Koke J. to sign further final orders flowing from the minutes of settlement. By order dated February 13, 2015, Varpio J. imposed a penalty for contempt, and prohibited the appellant from taking any further steps in the proceeding or in any related proceeding in Ontario or any other jurisdiction, without leave of the court. The appellant did not appeal the contempt order.
Three subsequent orders are the subject of the present appeals.
The first is an appeal from the order of Varpio J. dated October 27, 2016. The appellant moved under rule 59 of the Rules of Civil Procedure to vary para. 17 of the Final Order, arguing that there had been a mistake or slip in including this term in the order. Varpio J. dismissed the motion to vary the order ab initio, finding it was an attempt by the appellant to avoid the earlier finding that she was in contempt of the Final Order.
The second appeal is from the order of Gareau J. dated December 13, 2016, dismissing the appellant's motion for leave to commence a new action against the respondents. The proposed action related to one or more Swiss bank accounts of the appellant's deceased father. The motion judge concluded that, because of the passage of time, the action would be tantamount to an abuse of process and that, in any event, the claims were statute-barred.
The third appeal is from the order of Varpio J. dated March 9, 2017, that dismissed a motion by the appellant for his recusal and for transfer of the proceedings to Toronto.
(1) Did the motion judge err in finding that the para. 17 issue was an attempt to re-litigate matters already decided?
(2) Did the motion judge err in refusing the appellant's request for leave to commence a new action against the respondents?
(3) Did the motion judge err in law in refusing to recuse himself due to a reasonable apprehension of bias?
Holding: Appeals dismissed.
(1) No. There was no apparent purpose to the appellant's attempt to vary para. 17 of the Final Order, other than to challenge the basis for the prior contempt finding (which the appellant confirmed in her oral argument to the court remained her objective). The motion judge properly concluded that this was an attempt to undermine the contempt finding, which was not appealed, and to re-litigate a settled matter.
(2) No. The appellant was required to obtain leave to commence any proceeding against the respondents, pursuant to the February 13, 2015 order of Varpio J. Justice Gareau properly denied leave when the claims could not possibly succeed because of the expiry of limitation periods. The claims the appellant seeks to litigate, which she acknowledged having discovered in November 2002, are barred by the operation of one or more of s. 38(3) of the Trustee Act, R.S.O. 1990, c. T.23, the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, and the old Limitations Act, R.S.O. 1990, c. L.15.
(3) No. The motion judge carefully considered the various statements referred to by the appellant, and explained why, when such statements were considered in context, there was no air of reality to the bias claim. The refusal to transfer the proceedings was based on a proper exercise of the motion judge's discretion after he considered the balance of convenience to the parties. Accordingly there was no basis to interfere.
Jeff C. Hopkins and Kristen Pennington, for the appellant/respondent by way of cross-appeal
Gerald Griffiths, for the respondent/appellant by way of cross-appeal
Keywords: Employment Law, Wrongful Dismissal, Damages, Payment in Lieu of Notice, Reasonable Notice Period, Bonus, Benefits
The respondent terminated the appellant's employment as President and General Manager without just cause. The appellant was 51 years old at the time, and had been employed by respondent for 11 years; 4 years as President.
The appellant had brought a motion for summary judgment to determine issues of reasonable notice, loss of bonus for the 2016 year he had worked, loss of bonus during notice period and loss of benefits during notice period.
Motion judge awarded appellant 17 months' salary in lieu of reasonable notice and an amount for his 2016 bonus.
The appellant appeals the dismissal of his claim for his bonus and benefits during the 17-month period of reasonable notice. The respondent cross-appeals from the award of 17 months' reasonable notice, saying it should be between 12 and 15 months and from the award of a bonus for 2016.
(1) Did the motion judge overemphasize one of the Bardal factors, character of employment, and underemphasize the other factors?
(2) Did the motion judge err in awarding the appellant's claim for his 2016 bonus?
(3) Did the motion judge err in denying the appellant's claim for his benefit package during the notice period?
(4) Did the motion judge err in denying the appellant's claim for bonus during the notice period?
Appeal allowed. Cross-appeal dismissed.
(1) No. The motion judge was alive to this issue. He instructed himself to assess reasonable notice in a "holistic manner" without giving disproportionate weight to one factor. The motion judge considered Fisher v. Hirtz, 2016 ONSC 4768, which explained that a longer notice period is generally justified for older, long term employees who are at a competitive disadvantage in securing new employment. He also referred to Day v. JCB Excavators Ltd., 2011 ONSC 6848, which had comparable facts and which set the reasonable notice period at 17 months.
(2) No. The respondent's argument that the appellant was underperforming was rejected by the motion judge because the respondent never communicated this to the appellant and did not cite this in his termination letter. The respondent attempted to make this same argument on appeal. The respondent failed to identify any error of law or palpable and overriding error of fact by the motion judge.
(3) Yes. The motion judge erred in law by accepting the respondent's argument that the appellant must prove that he suffered a loss to make out this claim. The law in Ontario on the issue of benefits was settled by the Court of Appeal in Davidson v. Allelix Inc. (1991), 7 O.R. (3d) 581 (CA), wherein the court stated that a wrongfully dismissed employee may claim, in addition to lost salary, the pecuniary value of lost benefits flowing from such dismissal. The recovery of lost income is not limited to salary. Other income items such as benefits should be included.
(4) Yes. The motion judge failed in not applying the two-part test set out by the Court of Appeal in Pacquette v. TeraGo Networks Inc., 2016 ONCA 618. The bonus was an integral part of the appellant's compensation package and there was nothing in the language of the bonus plan that would limit that right over the notice period.
Anita W.H. Wong and Scott Hawryliw, for the appellants
Roger H. Chown and Marie Hynes, for the respondents
First Student Canada and David Ribble
Andrew A. Evangelista and Justine Ajandi, for the respondents, Ryan Zaroski and 1853780 Ontario Inc. o/a Kee to Bala
Keywords: Torts, Assault, Negligence, Standard of Care, Summary Judgment, Rules of Civil Procedure, Rule 20.05
Ryan Turcotte ("Turcotte") and his parents appeal the dismissal of their action against the respondents on two motions for summary judgment. Turcotte attended "resort night" at the Kee to Bala bar (the "Kee"), operated by the respondent 1853780 Ontario Inc. He returned to Barrie early the next morning on a bus chartered by the Kee from the respondent First Student Canada ("First Student"), and driven by the respondent David Ribble ("Ribble"). The respondent, Ryan Zaroski ("Zaroski"), was hired by the Kee as a security guard at the bar and on the bus.
The defendants, Aaron Lewis and Courtney Lewis, are cousins. Aaron Lewis was a passenger on the bus. At some point before the bus arrived in Barrie, Aaron Lewis contacted Courtney to ask him to meet the bus at its drop-off point. Almost immediately after he stepped off the bus, Turcotte was allegedly assaulted by Aaron Lewis, Courtney Lewis and other unknown assailants. He sustained a serious head injury. He sued Aaron Lewis, Courtney Lewis and the respondents. He claimed that the assault was foreseeable and that the respondents had failed to take reasonable care to prevent it.
The respondents, First Student and Ribble, brought a motion for summary judgment to dismiss the claims against them. The Kee and Zaroski brought a second motion for summary judgment for the same purpose. The motions were heard together. There were two issues on the motions. First, whether the case was suitable for disposition by summary judgment. The motions judge held it was. Second, whether the moving parties, the respondents on this appeal, had met the applicable standards of care. The motion judge held they had. She granted their motions, dismissing the action against all the moving parties.
(1) Did the motion judge err in concluding that this was an appropriate case for summary judgment?
(2) Did the motion judge err in her assessment of the standard of care?
Holding: Appeal allowed.
(1) No. The appellants did not tender expert evidence on the standard of care, nor did they seek an adjournment of the motions to obtain either expert evidence or a police report. They agreed to the motion judge presiding on the motions, even though she had conducted the criminal trial. The motion judge's conclusion that the case was suitable for summary judgment is entitled to deference.
(2) Yes. The motion judge significantly understated the standard of care. The Kee operated a bar, which catered to a large number of youthful patrons. It provided transportation, through the services of First Student, so that its patrons could drink without driving. The Kee provided security, at the bar and on the bus, to address the foreseeable risk of violence between patrons. The individual respondents, Ribble and Zaroski, were part of the transportation and security system and were trained in their respective responsibilities to deal with foreseeable risks, including the risks posed by unruly or violent passengers. The motion judge's abbreviated assessment of the standard of care led her to understate the means available to the respondents to avoid putting Turcotte in the midst of a dangerous environment or to take measures to protect him when he did get off the bus.
While the motion judge said that she accepted the evidence most favourable to the appellants, she never precisely articulated what evidence that was. Nor did she resolve inconsistencies in the evidence. The factual underpinnings of her analysis are not known. For these reasons, a trial was necessary. The judge trying the matter will be entitled to give pre-trial directions pursuant to Rules 20.05(1) and (2) to ensure the just, expeditious and efficient determination of the proceeding on its merits.
Geoffrey D.E. Adair, Q.C., for the appellants
Michael R. Kestenberg, for the respondents
Keywords: Torts, Defamation, Partnerships, Vicarious Liability, Lawyers Practicing in Association, Summary Judgment
The appellant Wallbridge is a partnership of lawyers. The respondents are Williams Litigation Lawyers and Faye Brunning, a lawyer who practices "in association" at Williams Litigation. Brunning's practice is separate from that of Williams, but she shares the same office address, telephone number, fax number and front desk receptionist. She pays Williams a monthly rental fee for the space and facilities she uses in Williams' office. Williams authorized Brunning to use its letterhead described below, without supervision. Williams' letterhead references Brunning as "Practicing in Association, not in Partnership". In particular, Brunning's name is listed with other lawyers' names in the header of the letterhead with an asterisk beside her name. She is the only lawyer listed in the header of the letterhead with an asterisk. The footer of the letterhead lists Brunning's name again and all of her contact information. Similarly, Brunning's email signature indicates that she is "Practicing in Association with Williams". Williams' website includes a photo of Brunning, along with photos of the Williams lawyers under the titles "Our Lawyers" and "Meet Our Team". The other lawyers are identified as Counsel, Partner or Associate. Brunning is identified as "Lawyer, Practicing in Association".
Wallbridge issued a statement of claim alleging that Brunning made a series of defamatory comments, misrepresentations and allegations about or directed at Wallbridge related to their representation of former Indian Residential School (IRS) students. Wallbridge named Williams as a defendant claiming that Williams was vicariously liable for the defamatory comments, misrepresentations and allegations of Brunning. Williams had no knowledge of the allegedly defamatory correspondence written and sent by Brunning in respect of the IRS claims. Williams brought a motion for summary judgment seeking dismissal of the action as against it. In resisting the motion, Wallbridge filed no affidavits, but did file a letter from Williams' counsel.
On motion for summary judgment Williams raised two issues. First, Williams argued Wallbridge had not filed the correspondence alleged to be defamatory, and so had failed to put its best foot forward. Second, Williams argued that since the evidence established Brunning was never an employee, agent or partner of Williams and was never held out to be the same, there was no basis upon which it could be found vicariously liable. The motion judge granted summary judgment on the second issue, deciding that Williams could not be vicariously liable for Brunning's allegedly defamatory correspondence. She found it unnecessary to deal with the first issue.
(1) Was the appellant required to provide evidence of defamation at the motion for summary judgment?
(2) Did the motion judge err in granting summary judgment on the issue of vicarious liability?
Held: Appeal allowed.
(1) No. There was no denial in Williams' evidence that Brunning sent the correspondence, and the court knew from having heard another motion in the proceeding that Brunning claimed defences for having written the correspondence. The motion judge was entitled to take judicial notice of what was in the court file, namely, that Brunning conceded writing the correspondence alleged to be defamatory. Had the motion judge dealt with this argument, it would have been properly rejected. Williams defended the action as against it on the basis that it was not liable for any of Brunning's acts or omissions. Williams' statement of defence did not deny or otherwise address the paragraphs of the statement of claim that set out Brunning's allegedly defamatory correspondence. Consistent with this, Williams brought its summary judgment motion solely on the basis that it could not be found to be vicariously liable for that correspondence. Given that Williams' summary judgment motion was brought solely on the ground of vicarious liability, Wallbridge was only obliged to respond to that issue.
(2) Yes. The question of whether Williams was liable for Brunning's alleged defamation was without precedent and involved the application of policy rationales. The implications of lawyers "practicing in association" are potentially far-reaching, certainly much wider than the litigants and dispute in this case. It was not in the interests of justice to decide the question on a summary judgment motion, given the importance and novelty of the question and the existence of much evidence supporting the appellant's position. The question would be better determined on a full evidentiary record, where the factual and legal issues and the consequences of imposing liability on the respondent can be carefully considered.
The motion judge did not attach weight to the fact that the publication of most of the allegedly defamatory correspondence was on the letterhead of the Williams firm. This could reasonably be seen as Williams placing its reputation behind the alleged defamation. Brunning's use of Williams' letterhead to send the allegedly defamatory correspondence was fully authorized. Williams granted to Brunning a complete and uncontrolled licence to communicate using its letterhead. In doing so, Williams created the opportunity, and took the risk, Brunning could use its letterhead to publish defamatory material, as it is alleged she did in this case. While the motion judge found Williams never held Brunning out as a "Partner" or "Associate" of the firm, she never considered the import of the fact that Williams held Brunning out as "associated" with it.
The evidence clearly establishes Brunning was associated with Williams. The letterhead and website state that Brunning is not a "Partner", and they distinguish her from the status of "Associate". However, the evidence could support a finding that Williams holds Brunning out as a lawyer who is one of "Our Lawyers" and a member of "Our Team", albeit one who practices in "association" with it. Given the strength of the evidence that could support a finding that Williams should be found liable for Brunning's allegedly defamatory correspondence, and given the novelty and importance of the question, the motion judge should have refused to grant summary judgment and allowed the matter to proceed to trial.
Peter H. Griffin and Danielle Glatt, for the appellant
Gavin J. Tighe, Alexander Melfi, and John A. Campion, for the respondent
Keywords: Contracts, Title Insurance, Coverage, Mortgage Fraud,Contractual Interpretation, Ambiguity, Contra Proferentem, Cabell v. The Personal Insurance Company, 2011 ONCA 105
The Respondent, Mr. Karl Nodel, was a private mortgage lender and the victim of a mortgage fraud. He made a claim for his loss under a mortgage insurance policy he had purchased from Stewart Title Guaranty Company ("Stewart Title").
A man posing as John Colarieti (the borrower) sought a $1,100,000 loan from Mr. Nodel, for investment purposes. Mr. Nodel agreed to lend the money to the borrower, to be secured with a second mortgage on a valuable residential property registered in Mr. Colarieti's name.
Mr. Nodel hired a lawyer, Mr. Isaac Singer, to arrange mortgage security and to close the transaction. He instructed Mr. Singer to acquire mortgage insurance. Mr. Singer was an "Examining Counsel", authorized to assist in the purchase of mortgage insurance from Stewart Title. He arranged mortgage insurance from Stewart Title that included coverage for mortgage fraud.
At closing, Mr. Singer paid the mortgage money to the borrower's lawyer, Mr. Bryan Dale, in trust. After he received the money, Mr. Dale did not transfer the money to his client. Instead he transferred the money to third parties under his client's direction. The money and the client then disappeared.
At Mr. Nodel's direction, Mr. Singer made a claim against Stewart Title for coverage under the policy because of the mortgage fraud. In denying the claim, Stewart Title relied on a coverage exception in the policy that applies if mortgage proceeds are paid to any person other than the registered title holder ("Clause 2"):
- Notwithstanding anything else contained within this Policy, in the event the proceeds of the Insured Mortgage are paid to any person or entity other than: i) to the registered title holder ... then the Company can deny coverage and shall have no liability to the insured for any matters that involve the allegation of mortgage/title fraud.
Since Mr. Nodel's lawyer had paid the mortgage proceeds to the borrower's lawyer, in trust, rather than directly to the borrower, Stewart Title said the exception applied.
Mr. Nodel sued Mr. Singer. Mr. Singer commenced a third party claim against Mr. Dale and Stewart Title. LawPro, the insurer for both lawyers – Mr. Singer and Mr. Dale – settled with Mr. Nodel, and took over the claim against Stewart Title. LawPro and Stewart Title agreed to settle their dispute about insurance coverage through an application by LawPro, in Mr. Nodel's name, for a declaration that the title insurance provides coverage for the losses incurred. The application judge declared that the exception does not apply, and that the policy does provide coverage. Stewart Title appealed.
(1)Did the application judge err in finding that Mr. Nodel's loss was covered by the mortgage insurance policy?
Holding: Appeal dismissed.
(1) No. The Court held that the application judge was correct.
Stewart Title urged that the application judge erred, in turn, by: (i) failing to give effect to the clear meaning of the exception, and in finding ambiguity by looking at the word "paid" in isolation; (ii) "giving no weight to the factual matrix surrounding how the Policy language operates in practice and in its commercial context" when resolving the ambiguity; and (iii) resorting to contra proferentem reasoning before exhausting other methods of contract construction.
LawPro contended that the application judge's conclusion was correct. It argued that the words "are paid to" cannot be confined to payment transmitted into the hands of the registered title holder without nullifying coverage under the policy. It agreed that "paid to" is unambiguous, but argues that it is unambiguously a broad enough term to encompass many methods of payment, including payment to the borrower's trustee. In the alternative, LawPro argues that if Stewart Title's proposed interpretation was viable and the exception was ambiguous, then that ambiguity must be resolved in favour of coverage, as the application judge did.
The court held that Clause 2 was ambiguous and that there were at least two potential meanings that arose for the language used, in context. Either the exception arises where money is paid beneficially to someone other than the borrower, or where money is handed over or delivered to someone other than the borrower. The court stated that when Clause 2 is interpreted in context, in light of the reasonable expectation of the parties and in a commercially sensible manner, the ambiguity that is created by these complications is resolved. Properly interpreted, that exception is triggered if the proceeds of the mortgage are transferred beneficially to any person or entity other than the borrower in the Insured Mortgage transaction.
Even if the ordinary meaning of Clause 2 does purport to require transmission into the hands of the registered title holder before there will be insurance coverage, which the Court did not accept, Clause 2 could not be given this interpretation. This is because no mortgage fraud occurs where money is transmitted into the hands of the registered title holder. If Clause 2 were to require transmission into the hands of the registered title holder for coverage to apply, the policy would provide no actual mortgage fraud insurance. As a matter of law, an exception clause that results in a policy insuring nothing is nullified: Cabell v. The Personal Insurance Company, 2011 ONCA 105, 104 O.R. (3d) 709, at paras. 1-2.
The court stated that properly interpreted, the exception enabling Stewart Title to deny coverage applies if the proceeds of the mortgage are transferred beneficially to a person or entity other than the borrower in the Insured Mortgage transaction (as defined in the policy). This did not happen here. Instead, the payment was made in trust to the borrower's lawyer for the benefit of the borrower. It was, in law, a payment to the borrower. Further, payment of mortgage money to a borrower's lawyer in trust is a routine practice and disqualifying coverage where payment is made to the borrower's lawyer in trust would not produce a reasonable commercial result.
Thus, the court held that the application judge was correct in declaring that Mr. Nodel's loss was covered by the mortgage insurance policy.
Nordheimer J.A., in dissent
In dissent, Justice Nordheimer held that the wording of the exception was unambiguous and by its plain terms, it applied to this situation.
The mortgage funds were not handed over or transferred to the registered title holder, or the person everyone assumed was the registered title holder, and thus the funds were not paid in accordance with the terms of the insurance contract. If they had been, and the person posing as the registered title holder had managed to take off with the funds, then undoubtedly Stewart Title would have had to provide coverage (subject to any other defences or claims against others). In this case, however, the mortgage funds were paid in breach of the express terms of the insurance policy. As a result, Stewart Title was entitled, under the terms of its policy, to deny coverage.
Americo Fernandes, for the appellant
Alex Van Kralingen and Mark Repath, for the respondent
Keywords: Civil Procedure, Amending Pleadings, Limitation Periods, Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, ss.4, Special Circumstances, Joseph v. Paramount Canada's Wonderland, 2008 ONCA 469
The appellant appeals from the decision of the motion judge permitting it to file a third fresh as amended statement of claim, but precluding it from referring to five prior shipments or claiming damages in respect of those shipments from the respondent freight forwarder. The motion judge found that the limitation period had expired in respect of the five prior shipments and that this constituted a prejudice that could not be compensated, thus barring the amendment.
(1) Did the motion judge err by failing to consider that the limitation period applies only to pleadings for unrelated statute-barred claims?
(2) Did the motion judge err by finding that new claims cannot be added to a claim that has already been commenced?
Holding: Appeal dismissed.
(1) No. The appellant's argument that containers 1-5 were part of the same claim because they involved breach of the same contract must be rejected. The appellant's consent to the order striking this portion of the claim under r. 25.11 without leave to amend, on the basis that facts concerning these containers were irrelevant to its claim, is conclusive against this argument. The motion judge found there was no evidence that the parties had agreed to waive the limitation period and no explanation for the appellant having consented to the order, only to attempt to resurrect it over four years later. He properly rejected the argument that special circumstances permitted the addition of a claim to a claim already commenced, citing Joseph v. Paramount Canada's Wonderland, 2008 ONCA 469, which held that the doctrine of special circumstances no longer exists.
(2) No. The appellant argued that s. 4 of the Limitations Act 2002, S.O. 2002, c. 24, Sched. B does not apply to proceedings that have already been commenced, and so does not bar amendments under r. 26.01. The court disagreed. As the court noted in Joseph, the rules must be read in light of the Act and its purpose in establishing a basic limitation period in s. 4. Amendments adding claims after the limitation period has expired constitute prejudice.
Ryan M. Kniznik, for the appellant
Marcy Segal, for the respondent
Keywords: Family Law, Custody, Evidence, Admissibility, Hearsay, Surreptitious Recordings, Voir Dire
The mother appeals a decision awarding custody to the father. In 2010 the Children's Aid Society placed the children with the father, taking the position that the children were in need of protection if they continued to reside with their mother. In 2012, the appellant mother signed Minutes of Settlement agreeing that the father's home would be the principal residence of the children.
Conflict between the parties led them to seek sole custody instead of joint custody, to which they had previously agreed.
(1) Did the trial judge err in failing to hold a voir dire to determine whether statements could be admitted on the ground that they were necessary and reliable?
(2) Did the trial judge err in refusing to admit hearsay evidence of statements made by the children?
(3) Did the trial judge err in refusing to admit surreptitious recordings made by the appellant mother of statements made by the children?
(4) Did the trial judge place too much emphasis on the long term status quo?
(1) No. The mother had the opportunity to discuss voir dires with duty counsel. At no time during the trial did the mother ask for such a hearing.
(2) No. First, the trial judge's finding that the mother's evidence about the statements made by the children was not reliable was amply supported by the record. Second, it was not necessary to hear evidence on the views and preferences of the children other than from the OCL. There was no reason to suspect that the views and preferences of the children were not adequately and properly put before the court.
(3) No. The trial judge was not wrong to not allow the mother to play the tape recording by reason that parents should be discouraged from attempting to obtain evidence from children in this manner. More importantly, all of the necessary evidence about the children's reaction to an incident involving their father was otherwise before the court.
(4) No. The trial judge's reasons reflect a thorough and sensitive weighing of the children's best interests.
Robert Fenn, acting in person
M Roefe, for the respondents
Keywords: Civil Procedure, Appeals, Dismissal for Delay, Motions, Adjournments
The moving party is self-represented. The Registrar dismissed his appeals for failure to perfect. By order dated December 20, 2017, Nordheimer J.A., sitting as a single judge of the Court of Appeal, declined to set aside the Registrar's order. He concluded that the moving party had failed to provide any real reason for the delay to perfect, and there was no merit in the appeals. The moving party sought to adjourn his motion to reconsider Nordheimer J.A.'s order. He submitted that he was on pain medication and wished to advance undefined arguments relating to the Canadian Charter of Rights and Freedoms. His request was opposed by the respondents, who are relatives of the moving party.
Issue: Should the moving party's request to adjourn the motion to reconsider be allowed?
Holding: Motion dismissed.
Reasoning: No. While the Court of Appeal is mindful of the moving party's health concerns, the draft medical report, filed in support of his request, is from January and therefore dated, and it does not say that there is any impediment to his participation in these proceedings. The moving party had ample opportunity to file adequate materials, did file and serve in person extensive quantities of materials, and could have sought the adjournment at an earlier date. The Court of Appeal found that it would be unfair to the respondents to adjourn this matter. The interests of justice would not be served by an adjournment.
M L Kropp, for the appellant
L J Tupman, A Bettencourt and J E S Poyser, for the respondent
Keywords: Wills and Estates, Inter Vivos Transfers, Undue Influence, Burden of Proof, Presumption of Undue Influence, Banton v. Banton (1998), 164 D.L.R. (4th) 176, Testamentary Gifts, , Vout v. Hay,  2 S.C.R. 876, Neuberger v. York, 2016 ONCA 191, Costs, Whether Payable by Estate
The appellant, Seguin, appeals from the dismissal of her action to invalidate her father's two most recent wills, under which the respondent, Pearson, is the principal beneficiary, and to set aside an inter vivos transfer of his house into joint tenancy with the respondent. The trial judge rejected the appellant's contention that the disposition to the respondent was the product of undue influence. He found, on the basis of "all of the evidence", that the appellant had failed to prove that the respondent exerted dominance over Mr. Paterson's will.
(1) Did the trial judge err by finding that the respondent had not exercised undue influence over Mr. Paterson?
(2) Did the trial judge err by failing to order that all of the appellant's trial costs be paid from Mr. Paterson's estate?
Holding: Appeal and motion for leave to appeal costs dismissed.
(1) No. The appellant mischaracterized the test for undue influence in the context of testamentary gifts. The rebuttable presumption of undue influence arises only in the context of inter vivos transactions that take place during the grantor's lifetime. It arises from particular relationships when the validity of inter vivos dispositions or transactions is in issue. Once the presumption is established, the onus shifts to the transferee to rebut the presumption: Banton v. Banton (1998), 164 D.L.R. (4th) 176 (Ont. Ct. (Gen. Div.)), at p. 209.
In the case of wills, it is testamentary undue influence, amounting to outright and overpowering coercion of the testator, which must be considered. The party attacking the will bears the onus of proving undue influence on a balance of probabilities: Vout v. Hay,  2 S.C.R. 876, at p. 887; see also Neuberger v. York, 2016 ONCA 191, 129 O.R. (3d) 721, at paras. 77-78.
Although the trial judge erroneously conflated the test for undue influence that applies to inter vivos transfers with the relevant test in relation to testamentary gifts, this error did not affect the reasonableness of his conclusions that the respondent exercised no undue influence over Mr. Paterson, and that Mr. Paterson independently decided to make the impugned wills and the transfer of property in favour of the respondent. The trial judge's finding that there was no undue influence using the inter vivos standard would necessarily be the same had the trial judge applied the correct standard applicable to testamentary dispositions.
(2) No. While acknowledging that he had the discretion to order payment of all of the appellant's costs from her father's estate, the trial judge determined that it would be unfair to do so. The appellant was entirely unsuccessful at trial and payment of her costs from the estate would effectively leave the respondent with nothing. The trial judge nevertheless exercised his discretion to order that a part of the appellant's costs be paid from the estate. There was no error in the trial judge's discretionary decision, which is entitled to deference. Further, the appellant did not identified any reviewable error in the amount of costs ordered by the trial judge.
[MacPherson, Pepall and Miller JJ.A.]
No one appearing for the appellant
V Pilnitz, for the respondent
Keywords: Appeal Book Endorsement, Failure to Appear
[Pepall, Brown and Trotter JJ.A]
J Goldblatt and I Graham, for the appellant
T Morgan, for the respondent
Keywords: Appeal Book Endorsement, Real Property, Leases, Torts, Unlawful Act Conspiracy
[Hourigan, Pardu and Huscroft JJ.A]
C-A Burdet, for the appellants
G Boyd, for the respondent
Keywords: Appeal Book Endorsement, Condominium Law, Condominium Act, 1998, Rules of Civil Procedure, Rules 59.06(2) and 2.1.02(1)
[Epstein, Hourigan and Paciocco JJ.A]
S Turney and A Reklitis, for the moving party, Fasken Martineau DuMoulin LLP
Y D Payne, for the responding party, Matthew Weenen
Keywords: Contracts, Solicitor and Client, Solicitor's Liens, Charging Orders
[Doherty, van Rensburg and Nordheimer JJ.A]
A Rogerson, for the appellant
J Porter, Q.C., for the respondent
Keywords: Torts, Defamation, Qualified Privilege, Employment Law, Evidence, Hearsay, The Rule in Browne v. Dunn (1893), 6 R. 67, H.L
[MacPherson, Pepall and Miller JJ.A]
Michael Mikhail, acting in person for the appellants
P Gaglia, for the respondent, Paul Mitchell (C64216)
N Lean, for the respondents, Linda Hill and Paul Mitchell
Keywords: Contracts, Real Property, Mortgages, Guarantees, Default, Notice of Sale
R v. L.H.E., 2018 ONCA 362 (Publication Ban)
[Hoy A.C.J.O., MacPherson and Juriansz JJ.A.]
B Davies and A Burgess, for the appellant
Jennifer Epstein, for the respondent
Keywords: Criminal Law, Sexual Assault, Sexual Exploitation, Sexual Interference, Ineffective Assistance of Counsel, R. v. L.C.T., 2012 ONCA 116
[Sharpe, Pepall and Fairburn JJ.A.]
M Dineen, for the appellant Courtney Lewis
E Neubauer, for the appellant Aaron Lewis
P Fraser, for the respondent
Keywords: Criminal Law, Assault, Aggravated Assault, Aiding and Abetting, Self-Defence, Jury Instructions, Evidence, Eyewitness Testimony, R. v. M.B., 2017 ONCA 653, Questions from The Jury, R. v. Ellis, 2013 ONCA 9
[Hoy A.C.J.O. and Simmons and Pardu JJ.A.]
L Beechener, Z Kerbel and S Wickramasinghe, for the appellants
S Magotiaux, for the respondent
Keywords: Criminal Law, First Degree Murder, Aiding and Abetting, Jury Instructions
[Feldman and Benotto JJ.A. and Sachs J. (ad hoc)]
M J Venturi, for the appellant
A Hotke, for the respondent
Keywords: Criminal Law, Sexual Assault, Evidence, Collusion, R. v. Perkins,  O.J. No. 3246
[Feldman and Benotto JJ.A. and Sachs J. (ad hoc)]
R Parker, for the applicant
C Bartlett-Hughes, for the respondent
A Moustacalis, for the appellant
Keywords: Criminal Law, Interveners, Ineffective Assistance of Counsel, R. v. Seaboyer (1986), 50 C.R. (3d) 395, Collateral Issues, Delay, Motion Dismissed
[Feldman and Benotto JJ.A. and Sachs J. (ad hoc)]
R Litkowski and Jessica Zita, for the appellant
M Flanagan, for the respondent
Keywords: Criminal Law, Administering a Noxious Substance, Administering a Stupefying Substance for the Purpose of Sexual Assault, Sexual Assault, GHB, Circumstantial Evidence, R. v Villaroman, 2016 SCC 33, Sentencing
[Feldman and Benotto JJ.A. and Sachs J. (ad hoc)]
D G Duquette, acting in person
S E Fraser, appearing as amicus curiae
P Fraser, for the Ministry of the Attorney General
J Zamprogna, for the Southwest Centre for Forensic Mental Health
Keywords: Criminal Law, Not Criminally Responsible, Mental Disorder, Uttering a Threat to Cause Death or Bodily Harm, Threat to Public Safety, Medcof (Re), 2018 ONCA 299
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