Canada: Explain Yourself! The Ontario Court Of Appeal Reminds Us Of The Importance Of Reasons In Barbieri v. Mastronardi

Overview

Recently, the Ontario Court of Appeal reminded us of the importance of reasons for judgment in Barbieri v. Mastronardi. A unanimous Court allowed an appeal from an order granting summary judgment to a plaintiff who sued for breach of contract and negligence, holding that the lack of sufficient reasons in the motion judge's endorsement left the Court with no choice:

24 Given the inadequacy of the endorsement of the motion judge, we cannot conduct a meaningful review of his decision.

25 In these circumstances, we have no alternative but to grant the appeal and set aside the declaration of the motion judge that the appellant is liable to the respondent.

Background & Decision

Nicolina Barbieri, the respondent, purchased a home from Fernando Mastronardi, the appellant, in 2007, but was apparently unfamiliar with its storied history. The Toronto Police raided the property in 2006, and found a marijuana grow-op in the basement. Subsequently, the City of Toronto issued work orders for the home, stating that it was in an unsafe condition. These work orders were rescinded after Mr. Mastronardi commissioned remedial work to be done, and he eventually sold the property to Ms. Barbieri. After Ms. Barbieri found out about the grow-up, she sued Mr. Mastronardi in negligence and breach of contract, alleging that he failed to disclose that the home had been a grow-up, and that there was a mould problem that rendered the home uninhabitable.

Ms. Barbieri brought a motion for summary judgment against Mr. Mastronardi. Although she was successful at first instance, the Court of Appeal noted that the "motion judge concludes that the appellant is liable to the respondent, but his endorsement offers no legal analysis and contains no findings of fact. He declares that the appellant "failed in his duty" to the respondent, without explaining how he reached that conclusion."

Although the Court acknowledged that there is case law that suggests a vendor can be liable to a purchaser of a property that is not new if he knows of a defect that renders the premise uninhabitable and fails to disclose it (see Dennis v. Gray, 2011 ONSC 1567), it was concerned that the motion judge had not reached any conclusion with respect to a "critical factual issue" of whether there was mould in the property at the time of sale, or whether Mr. Mastronardi was aware of this. The Court was also concerned that the motion judge had not provided support for his assertion that even if the problems with the house had been remediated, the respondent would still have a claim for the stigma that attached to the property.

The motion judge's reasons, which were reproduced within the Court of Appeal's decision, consisted of 267 words across six paragraphs. They provided His Honour's legal conclusions about the case, but unfortunately did not address the evidence before the Court, or how His Honour arrived at those conclusions – they merely stated that the "evidence before [the motion judge] is sufficient to enable [His Honour] to reach a just result on the issue of liability."

The Court of Appeal required more than this to properly review the merits of the decision, and explained that:

22 In order to allow for meaningful appellant review, the decision of the court must, at a minimum, provide some insight into how the legal conclusion was reached and what facts were relied upon in reaching that conclusion: R. v. Sheppard, 2002 SCC 26, [2002] 1 S.C.R. 869, at paras. 24, 55; and Crudo Creative Inc. v. Marin (2007), 90 O.R. (3d) 213 (Div. Ct.).

23 The motion judge's endorsement does not contain necessary findings of fact and is so lacking in analysis that it impedes meaningful appellate review. While decisions of motion judges on summary judgment motions attract significant deference (see Hryniak v. Mauldin, 2014 SCC 7, at para. 81), there cannot be deference in circumstances where the appellate court cannot understand the legal basis for the decision or the factual finding made in support thereof.

Significance

This appellate decision is one of several recent cases on the importance of reasons, whether in the context of a judgment for a trial, motion, or application. The Court of Appeal last directly dealt with the issue in Harrison v. Burns, 2011 ONCA 664, in which the Court similarly overturned a summary judgment decision. In that case, however, the motions judge had "provided no reasons for his judgment."

Older cases were more forgiving of courts of first instance, but not reliably so. For example, in 426873 Ontario Ltd. v. Windermere on the Thames Ltd., [1984] O.J. No. 1014 (Div. Ct.) the Ontario Divisional Court dismissed an appeal from a Master's decision granting summary judgment, even though the Master did not record reasons for judgment. In Avco Financial Services Realty Ltd. v. Lagace, [1985] O.J. No. 1860 (C.A.), the Ontario Court of Appeal relied on the Divisional Court's precedent, holding that a "lack of written reasons is not a ground in itself for setting aside a summary judgment." This approach was contrary to an earlier line of cases including Koschman et al. v. Hay et al (1977), 17 O.R. (2d) 557 (C.A.) where, after a trial judge failed to provide reasons for judgment, the Court ruled that the "vital importance of reasons for judgment in such cases cannot be over-emphasized. This Court cannot decide issues of fact on the bald record...This Court has never departed from that principle." In 2000, Justice Borins, writing for the Court of Appeal in Smyth v. Waterfall et al., [2000] O.J. No. 3494 (C.A.) unequivocally confirmed the importance of reasons because "parties are entitled to know why the court reached its decision" and "a failure to provide a reasoned decision tends to undermine confidence in the administration of justice [and] makes appellate review difficult and, in some circumstances, may require a new trial or the rehearing of a motion or an application."

The Supreme Court of Canada further reinforced the importance of reasons in R. v. Sheppard, [2002] S.C.J. No. 30, a criminal case in which the accused was convicted, but the trial judge did not addressany of the contentious evidence or problems with the Crown's case in his reasons, and simply declared that he had considered all the testimony and that he found the accused guilty. A majority of the Court of Appeal set aside the conviction based on inadequate reasons, and the Supreme Court unanimously affirmed this decision. Justice Binnie, writing for the Court, explained that the delivery of reasoned decisions serves multiple purposes including (i) fulfilling the judge's duty to the public to be accountable for his or her decisions, (ii) letting a losing party know why they have lost, (iii) allowing lawyers to assess the merits of an appeal properly; and (iv) providing for meaningful appellate review.

Despite all of these important rationales for reasoned decisions, the Court in R. v. Sheppard did also state that deficient reasons do not automatically constitute a reversible error of law. If, based on the record, the appellate court can conduct a meaningful review and decide the case on its merits, then it should. The Supreme Court confirmed this view in Hill v. Hamilton-Wentworth Regional Police Services Board, 2007 SCC 41, where it stated that "reasons should be considered in the context of the record before the court. Where the record discloses all that is required to be known to permit appellate review, less detailed reasons may be acceptable [such as] in cases with an extensive evidentiary record..." However, when a trial judge is called upon to address troublesome principles of unsettled law or to resolve confused and contradictory evidence, the Court held that reasons are particularly important. The Ontario Court of Appeal put this concept into action in Sagl v. Cosburn, Griffiths & Brandham Insurance Brokers Ltd., 2009 ONCA 388, where the defendants appealed the trial judge's decision against them on a number of grounds, including that the trial judge erred by failing to address the challenges to the plaintiff's credibility in his reasons. Despite the rest of the grounds of appeal failing, since the credibility issue was relevant to deciding the outcome of the action, and the Court of Appeal was "unable to find anything in the record that indicates that the trial judge explicitly or implicitly considered the challenges to [the witness's] credibility", the trial decision was overturned.

The Barbieri decision is a reminder of the importance of clear reasons for judgment that demonstrate why a decision has been made and how any contentious factual or legal issues have been considered and resolved. Litigants who receive a decision that appears to contain deficient reasons should of course consult with counsel and consider appealing. The Sagl decision is a reminder that if reasons for judgment are deficient on even one issue, this could be a reversible error if that issue was crucial to the determination of the case. Respondents should also remember that when they are arguing against an appeal based on deficient reasons, it may be advisable to make extensive reference to the record and suggest that it is robust enough for the appellate court to conduct its own review of the matter, and that the appeal should be decided on the substance of the case, rather than the adequacy of the reasons below.

Case Information

Barbieri v. Mastronardi, 2014 ONCA 416

Docket: C58126

Date of Decision: May 21, 2014

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