- Baglow v. Smith, 2012
ONCA 407 (Goudge, Sharpe and Blair JJ.A.), June 14, 2012
- Bowes v.
Goss Power Products Ltd., 2012 ONCA 425 (Winkler
C.J.O., Simmons, Cronk, Armstrong and Watt JJ.A.), June 21,
- Galganov v. Russell (Township),
2012 ONCA 410 (Weiler, Sharpe and Blair JJ.A.), June 15, 2012
- Fresco v. Canadian Imperial Bank of
Commerce, 2012 ONCA 444 (Winkler C.J.O., Lang and
Watt JJ.A.), June 26, 2012
- Windsor (City) v. Paciorka Leaseholds
Limited, 2012 ONCA 431 (Doherty and LaForme
JJ.A., and Turnbull J. (ad hoc)), June 22, 2012
, 2012 ONCA 407 (Goudge, Sharpe and Blair
JJ.A.), June 14, 2012
This appeal applies the new test for summary judgment to the
issue of defamation in the context of political blogging.
In the course of an exchange concerning Omar Khadr between the
appellant John Baglow (blogging under the pseudonym, "Dr.
Dawg") and the respondent, Roger Smith, Smith referred to
Baglow as "one of the Taliban's more vocal
supporters." Baglow sued for defamation.
On a motion for summary judgment, Justice Annis dismissed
Baglow's claim against Smith for defamation, finding that
there was no genuine issue for trial as to whether the impugned
statement was defamatory. Baglow appealed to the Court of
Writing for the court, Blair J.A. held that the motion judge
erred in the finding that there was no genuine issue for trial and
noted specifically that this was not a case appropriate for summary
As Blair J.A. explained, summary judgment has historically
rarely been granted in defamation cases, in part because the
question of whether a statement is defamatory has long been
considered to be in the purview of a trier of fact. The motion
judge nonetheless concluded that it was appropriate to grant
summary judgment, principally because "the factual foundation
of the case is largely captured in the extensive materials taken
from the parties' blogs" and because "there seems
little in dispute of a factual nature that would be different were
[the case] to proceed to trial."
Blair J.A. disagreed with this conclusion, holding that while
the motion judge did have an extensive record before him in the
form of the exchanges between the parties, it was not sufficient to
make a proper determination. Determining whether the impugned
statement is in fact defamatory of the appellant would require a
careful analysis of the context in which the statement was made,
including not just a review of the electronic dialogue between the
parties but also an assessment of the two individuals and the view
they took of the exchange. The latter would at least require
cross-examination on the positions they initially put forward,
which was not possible on the motion as the matter had proceeded
under rule 76, Simplified Procedure, which does not permit
cross-examinations on affidavits.
The analysis further requires a consideration of the view that
a reasonable reader of the exchange might take of the exchange in
its particular context, an issue that might require expert
testimony concerning the expectations and understanding of
participants in political discourse in the Internet blogosphere.
The unique nature of the forum in which the alleged defamation
occurred raised issues that must be threshed out at trial.
Blair J.A. further noted that this dispute concerned a
scenario that has, thus far, received little judicial
consideration, namely an allegedly defamatory statement made in the
course of "a robust and free-wheeling exchange of political
views in the internet blogging world." Although both parties
had suggested that "anything goes" in exchanges laden
with often caustic, hyperbolic and vulgar language, Blair J.A.
questioned: "Is that the case in law?... Do different legal
considerations apply in determining whether a statement is or is
not defamatory in these kinds of situations than apply to the
publication of an article in a traditional media
As Blair J.A. noted, these issues have not been addressed in
the jurisprudence in any significant way. Their responses may have
far-reaching implications, and are best crafted on the basis of a
full record after a trial, "at least until the law evolves and
crystallizes to a certain point." A trial would allow these
conclusions to be formulated on the basis of a record informed by
the examination and cross-examination of witnesses and possibly
with the assistance of expert evidence to provide the court with
insight into how the Internet blogging world functions and what may
or may not be the expectations and sensibilities of those who
engage in such discourse.
The court allowed the appeal, directing the action to proceed
2. Bowes v. Goss Power Products
2012 ONCA 425 (Winkler C.J.O.,
Simmons, Cronk, Armstrong and Watt JJ.A.), June 21, 2012
On this appeal, the Court of Appeal – in a five
member panel – held that an employee who is terminated
without cause is not required to mitigate his loss when the parties
contractually agreed to a fixed term of notice or pay in
lieu, and the employment agreement is silent with respect to
The appellant Bowes entered into a written contract of
employment with the respondent, Goss Power Products Ltd., which
provided that he would receive six months' notice or pay
in lieu thereof if his employment was terminated without
cause. The employment agreement, prepared by the respondent
employer, was silent with respect to a duty to mitigate. The
appellant's employment was later terminated without cause
pursuant to a letter of termination which stated that he would be
paid his salary for six months but was required to seek alternative
employment during this period and keep the respondent apprised of
Shortly after his employment was terminated, the appellant
obtained a new position at the same salary he had been earning with
the respondent. After paying him the three weeks' salary
mandated by the Employment Standards Act, 2000, S.O. 2000,
c. 41, the respondent ceased making salary payments to the
appellant on the basis he had mitigated his loss successfully,
ending the respondent's obligation to continue paying his
salary. The appellant brought an application under rule 14.05 of
the Rules of Civil Procedure seeking a determination of
his rights pursuant to the employment agreement.
The application judge held that an employment agreement is
subject to a duty to mitigate unless the agreement, either directly
or by implication, relieves the employee of that obligation. In
arriving at his conclusion that the impugned employment agreement
is subject to a duty to mitigate, the application judge relied upon
the decision in Graham v. Marleau, Lemire Securities Inc.
(2000), 49 C.C.E.L. (2d) 289 (S.C.), in which Nordheimer J.
[A contractually fixed term of notice] is nothing more
than an agreement between the parties as to the length of the
reasonable notice to terminate the contract. I see no reason
why there should be any distinction drawn between contracts of
employment where the notice period is not stipulated and those
where it is with the result that there would be a duty to mitigate
in the former but not in the latter.
Finding that mitigation was applicable pursuant to
Graham, the application judge determined that the
agreement required explicit terms to negate the duty to mitigate.
Since the agreement provided no such exemption, the appellant was
not entitled to the full amount provided for under the agreement as
he had mitigated his loss by finding new employment.
The appellant appealed to the Court of Appeal.
Writing for the court, Winkler C.J.O. noted that employment
agreements are subject to the ordinary principles of contract law,
except that, unless otherwise stated, an employer must
provide reasonable notice to an employee prior to the termination
of employment. If the employer fails to provide such notice, the
employee is entitled to damages that flow from this breach. The
employee, however, is bound at law to mitigate such damages by
seeking an alternate source of income.
Parties to employment agreements are entitled to and often
substitute a fixed period of notice in the contract, displacing the
common law period of "reasonable notice". Winkler
C.J.O. held that both Nordheimer J. in Graham and the
application judge in this case erred in treating a contractually
fixed term of notice as effectively indistinguishable from common
law damages for reasonable notice and, having incorrectly equated
them, erred in concluding that the duty to mitigate applied to
contractual terms as it did at common law.
Rather, an employment agreement that stipulates a fixed term
of notice or payment in lieu should be treated as fixing
liquidated damages or a contractual amount. Because the damages are
liquidated, a duty to mitigate does not automatically attach. As
Winkler C.J.O. noted, this decision was consistent with appellate
decisions in other jurisdictions.
While the parties could have specified in the agreement that
mitigation did apply, "no presumption exists in law
necessitating that it must be contracted away expressly."
Winkler C.J.O. concluded that, if parties who enter into an
employment agreement specifying a fixed amount of damages intend
for mitigation to apply upon termination without cause, they must
express such an intention in clear and specific language in the
The court allowed the appeal, setting aside the decision of
the application judge and issuing a declaration that the appellant
is entitled to the amount of salary in lieu of notice
specified in the employment agreement, notwithstanding any salary
earned from his new employer.
3. Galganov v. Russell (Township),
2012 ONCA 410 (Weiler, Sharpe and Blair JJ.A.), June 15, 2012
This appeal addresses the circumstances in which an award of
costs can be made against a lawyer personally.
The appellant Bickley represented Galganov and Brisson in
their respective applications to quash a by-law which required that
the content of new exterior commercial signs be in French and in
English. The application judge dismissed both applications and
ordered that forty percent of the costs be payable by Bickley
personally pursuant to rule 57.07(1) of the Rules of Civil
Procedure, on the basis that his conduct was negligent and
that he caused unnecessary costs to be incurred by the respondent.
The Court of Appeal upheld the dismissal of the applications. This
decision on costs was released concurrently with those
Writing for the court, Weiler J.A. reviewed the governing
principle in awarding costs personally against a lawyer, as set out
by the Supreme Court in Young v. Young,  4 S.C.R.
3. She explained that rule 57.07(1) is not concerned with the
discipline or punishment of a lawyer, but only with compensation
for conduct which has caused unreasonable costs to be
Weiler J.A. then outlined the two-part test established in
Carleton v. Beaverton Hotel (2009), 96 O.R. (3d) 391 (Div.
Ct.) for determining the liability of a lawyer for costs under rule
57.07(1). The first step is to inquire whether the lawyer's
conduct falls within the rule in the sense that it caused costs to
be incurred unnecessarily.
As stated in Marchand (Litigation Guardian of) v.
Public General Hospital Society of Chatham (1998), 16 C.P.C.
(4th) 201 (Ont. Gen. Div.), mere negligence can attract costs
consequences in addition to actions or omissions which fall short
of negligence. "Bad faith" on the part of the lawyer is
not a requirement for imposing costs consequences under rule
57.07(1). However, in determining whether a lawyer's
conduct falls within rule 57.07(1), the court must consider the
facts of the case over the entire course of litigation and the
particular conduct which has been attributed to the lawyer.
Weiler J.A. noted that a court must also consider
"specific incidents of conduct" in determining whether
the conduct falls within rule 57.07(1). In Carleton, the
court confirmed that a general observation "does not permit
identification of what conduct may have contributed to delay and
unnecessary costs." Above all, rule 57.07(1) is not concerned
with a lawyer's professional conduct generally, but with
whether such conduct caused unreasonable costs to be
The second step in the Carleton test is to consider,
as a matter of discretion and applying the "extreme
caution" principle enunciated in Young, whether, in
the circumstances, the imposition of costs against the lawyer
personally is warranted. The "extreme caution" principle
refers to the fact that these awards must only be made sparingly,
with care and discretion, and only in clear cases.
Weiler J.A. determined that the application judge's
decision to award costs personally against Bickley was based on
"the cumulative effect of what she found to be his negligent
conduct which caused the Township to incur costs
unnecessarily." Turning to an examination of the specific
incidents of Bickley's conduct that were alleged to cause
unreasonable costs to be incurred, Weiler J.A. found that the
application judge erred in principle in not separating
Bickley's conduct from that of his clients and in relying
on hindsight when considering the reasonableness of conduct by
Bickley with respect to the proposal of a particular expert
witness. These incidents were so important to, and so intertwined
with the overall conclusion that the award of costs against Bickley
personally must be set aside.
Weiler J.A. also pointed out that if an order of costs is to
be made against a lawyer personally on the basis of negligence,
then that negligence must be based on a breach of the objective
standard of care of a reasonably competent lawyer in the same
position. The court must bear in mind that the lawyer's
duty is to his client and to the court. Rule 57.07(1) is not a
means for redress by a frustrated opposing counsel.
The court allowed the appeal, setting aside the order of costs
against Bickley personally.
v. Canadian Imperial Bank of Commerce,
2012 ONCA 444
(Winkler C.J.O., Lang and Watt JJ.A.), June 26, 2012
This decision was released concurrently with those in
Fulawka v. Bank of Nova Scotia, 2012 ONCA 443,
and McCracken v. Canadian National Railway, 2012 ONCA 445.
All three cases involve class actions initiated by employees
seeking unpaid overtime from employers pursuant to the Canada
Labour Code (the "Code").
This action was brought by the representative plaintiff Fresco
on behalf of some 31,000 customer service employees of the
defendant CIBC. The pleadings allege that CIBC breached its
contractual and statutory duties to pay class members for overtime
work that they were routinely required or permitted to perform in
order to complete their employment duties. Central to the case was
CIBC's overtime policy, which required that employees
obtain management approval of overtime hours in advance of working
overtime or as soon as possible thereafter in "extenuating
circumstances". The pre-approval requirement, which was
alleged to expressly place barriers to class members'
claims for overtime in violation of the Code, was
a key element of the case.
The motion judge held that the pre-approval requirement in the
defendant's overtime policy was not unlawful. She refused
to certify the action as a class proceeding, finding that none of
the appellant's nine proposed common issues satisfied the
test for commonality under s. 5(1)(c) of the Class Proceedings
Act, 1992 ("CPA").
A majority of the Divisional Court agreed with the motion
judge with respect to the lawfulness of the pre-approval
requirement as well as with the motion judge's conclusion
that there were no common issues that would significantly advance
the litigation. The majority emphasized that the pre-approval
requirement did not cause the wrongs alleged by the
Sachs J. of the Divisional Court wrote a detailed dissent,
explaining why she would have certified the action. She asserted
that the motion judge erred in law in holding that the
respondent's overtime policy was lawful under the
Code and committed a palpable and overriding error of fact
in overlooking evidence in the record supporting the certification
of most of the proposed common issues. Sachs J. explained that the
motion judge's rejection of the proposed common issues
flowed from her erroneous holding that it was "plain and
obvious" that that the overtime policy was lawful. The premise
of legality resulted in the motion judge failing "to consider
the evidence as to systemic policies and practices" that would
satisfy the minimum evidentiary basis of showing "some basis
in fact" for the existence of a common issue, the evidentiary
threshold established in Hollick v. Toronto (City), 2001
SCC 68,  3 S.C.R. 158.
Fresco appealed to the Court of Appeal.
Writing for the court, Winkler C.J.O. held that the motion
judge and the majority of the Divisional Court erred when
determining that the respondent's overtime policy complied
with the minimum standards for overtime compensation as set out in
the Code. Winkler C.J.O. agreed with Sachs J. that the
accepted test that a plaintiff must meet at the certification stage
under s. 5(1)(a) of the CPA is to establish that it is not
plain and obvious that its action will fail. As McLachlin C.J.
stated in Hollick, the test is not merits-based.
Winkler C.J.O. further noted that the appellant's
claim does not turn exclusively or even primarily on the per
se legality of the respondent's overtime policy. The
pleadings allege that CIBC's systems for assigning work,
recording hours of overtime work, and its actual practices for
compensating such work, breached the terms of class
members' contracts of employment and unjustly enriched CIBC
at the expense of class members. Winkler C.J.O. held that these
"systemic elements of the claim give shape to the common
Turning to the common issues, Winkler C.J.O. found that the
fundamental flaw by the motion judge was to focus on the personal
circumstances in which the individual claimants' claims for
overtime arose, as the approach to the analysis of
commonality. The evidentiary inquiry under s. 5(1)(c) of the
CPA ought not to have been focused on whether individual
class members actually worked overtime for which they were not
compensated, but rather required asking whether there is some basis
in fact for the appellant's allegations that CIBC's
bank-wide practices and policies prevented class members from
receiving overtime compensation in accordance with their employment
Winkler C.J.O. held that the motion judge and the majority of
the Divisional Court incorrectly concluded that the differences in
the individual experiences of class members undermine the existence
of a common issue of systemic wrongdoing. These alleged differences
were not relevant to the systemic issues raised by the appellant
and do not preclude a finding of some basis in fact for the common
issues concerning liability. The terms and conditions in
CIBC's overtime policies governing overtime compensation
and the standard forms that class members submit when requesting
such compensation apply to all class members regardless of their
particular job titles or responsibilities. To the extent that the
respondent's policies are alleged to fall short of its
duties to class members, or to constitute a breach of class
members' contracts of employment, these elements of
liability can be determined on a class-wide basis. They do
not depend on individual findings of fact.
Winkler C.J.O. concluded that the motion judge committed an
error of law in her analysis under s. 5(1)(a) of the CPA
and, in conducting the common issues analysis under s. 5(1)(c),
misconceived the appellant's action as being, in essence, a
collection of individual claims for unpaid overtime. These errors
displaced the substantial deference otherwise owed to certification
judges when considering the common issues criterion and called for
appellate intervention. The court allowed the appeal, concluding
that an order should be granted certifying the action.
5. Windsor (City) v. Paciorka Leaseholds
, 2012 ONCA 431 (Doherty and LaForme JJ.A.,
and Turnbull J. (ad hoc
)), June 22, 2012
Portions of the respondents' lands were expropriated
by the City of Windsor. At issue on appeal was the test for
determining compensation of expropriated and other affected
The Expropriations Act (the "Act")
requires the expropriating authority to pay to the owner the
"market value of the land". A highest and best use
analysis – without regard for the expropriation scheme
– applies. In addition to compensation for the market
value of the expropriated property, the owner is also entitled to
damages for injurious affection, representing the reduction in the
market value of the remaining land held by the owner which is
caused by the acquisition of part of the land.
The respondents brought claims before the Ontario Municipal
Board for the market value of the expropriated lands and for
injurious affection damages. The key factor in determining
the market value of the expropriated land and assessing the
injurious affection in respect of the remaining land was the scope
of the expropriation scheme and when that scheme began. While the
respondents argued that the expropriation scheme embraced certain
governmental activities beginning in 1983, the City submitted that
it did not begin until 2002. Central to the City's argument
on value was a 1996 Provincial Policy Statement ("PPS")
which, independent of any expropriation, placed limits on the
development of environmentally sensitive lands, such as those that
were being expropriated.
The Board rejected the City's position, ultimately
ordering the City to pay the respondents for the market value of
the expropriated properties and the loss in value of the remaining
properties. The Board's decision was upheld by a majority
of the Divisional Court, with Sachs, J. dissenting.
The Court of Appeal agreed with the dissenting opinion of
Sachs J., holding that, while the Board was entitled on the
evidence to favour the respondent's position as to the timing
of the scheme, the Board failed to adequately consider the impact
of the PPS on the market value of the lands. The evidence did not
support that any consideration was given by the owner's
experts to what the market value of the land would be when subject
to the limits imposed by the PPS. The majority of the
Divisional Court erred in law in deferring to the Board's
decision "in the face of the Board's unreasonable
treatment of the potential impact of the PPS on the market value of
the respondents' expropriated lands."
The court further held that the Board erred in its calculation
of injurious affection damages. The Board's reference to
the "scheme" (the same term used in respect of the
expropriated property) demonstrated that it did not limit the
injurious affection damages to the diminution in value caused by
the acquisition of the property, but considered decreases in value
caused by other aspects of the broader expropriation scheme.
The court determined that the Board erred in its interpretation of
The court concluded that the Board treated the entire
expropriation scheme as crucial to both market value under s.
14(4)(b) of the Act and to the calculation of loss in
value of the remaining lands for the purposes of the injurious
affection claim under s. 13(2)(c). Its failure to distinguish
between its approach to market value assessment and its approach to
the assessment of injurious affection damages resulted in a
"fundamentally flawed assessment of those damages."
The court held that the majority of the Divisional Court erred
in law in deferring to the Board's unreasonable assessment.
The court allowed the appeal, directing that a new hearing be held
before a differently constituted panel of the Board.
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