Canada: Top 5 Civil Appeals From The Court of Appeal (February 2015)

Last Updated: February 25 2015
Article by Angus T. McKinnon

1. Meady v. Greyhound Canada Transportation Corp., 2015 ONCA 6 (Strathy C.J.O., Feldman and Pardu JJ.A.), January 8, 2015

2. Ibrahim v. Robinson, 2015 ONCA 21 (Weiler, Feldman and Benotto JJ.A.), January 19, 2015

3. Wesbell Networks Inc. v. Bell Canada, 2015 ONCA 33 (Strathy C.J.O., Rouleau and Hourigan JJ.A.), January 23, 2015

4. First Elgin Mills Developments Inc. v. Romandale Farms Limited, 2015 ONCA 54 (Epstein, Lauwers and Pardu JJ.A.), January 28, 2015

5. Moore v. Getahun, 2015 ONCA 55 (Laskin, Sharpe and Simmons JJ.A.), January 29, 2015 

1. Meady v. Greyhound Canada Transportation Corp., 2015 ONCA 6 (Strathy C.J.O., Feldman and Pardu JJ.A.), January 8, 2015

This action arose out of an accident on a Greyhound bus. Shaun Davis was making the long journey from Calgary to Pictou, Nova Scotia. At a rest stop near Thunder Bay, he began exhibiting signs of anxiety and paranoia, claiming that other passengers were trying to harm him. Two police officers questioned and searched him, but ultimately concluded that Davis posed no threat and allowed him to re-board. Shortly thereafter, Davis lunged at the driver and grabbed the steering wheel, causing the bus to veer off the road and flip onto its side.

Tragically, one passenger was killed and many more injured. A number of them sued Greyhound and the driver, Albert Dolph, as well as the two OPP officers who communicated with Davis before he returned to the bus and their employer, the province of Ontario.

The trial judge dismissed the action against all of the defendants, other than Davis, who did not defend the action and was noted in default.

Central to the appeal was the trial judge's exclusion of the proposed evidence of two experts, one on police training and the other on the matter of bus safety. The appellants argued that the former would have established that a competent police officer, having observed that Davis was delusional, would have employed crisis management techniques to deter him from boarding the bus, and that the latter would have established that a prudent bus driver, aware of Davis' agitated condition and observing his behaviour, would have reduced his speed, averting the accident or at least mitigating the damage caused. The appellants further claimed that the trial judge failed to adequately articulate the standard of care applicable to the respondents.

Writing for the Court of Appeal, Strathy C.J.O. observed that in considering the admissibility of the impugned evidence, the trial judge correctly identified the test in R. v. Mohan, [1994] 2 S.C.R. 9. Under that test, the evidence must be relevant, it must be necessary to assist the trier of fact, it must not be subject to an exclusionary rule and it must be tendered by a properly qualified expert.  The appeal turned on the second requirement, the necessity criterion.

As the Supreme Court explained in Mohan, necessary evidence is that which provides information which is likely to be outside the experience and knowledge of a judge or jury. The necessity criterion asks whether the trier of fact can form a judgment on the relevant issues without the assistance of persons with special knowledge.

While Strathy C.J.O. noted that the content of the standard of care of a professional is a question of fact which will generally require expert evidence, he noted the "growing recognition of the responsibility of the trial judge to exercise a more robust gatekeeper role in the admission of expert evidence". As the Court explained in R. v. Abbey, 2009 ONCA 624, in determining whether the proposed evidence is necessary to the proper adjudication of the facts, the trial judge must consider whether the benefits of admission outweigh the costs. This exercise does not always yield a simple answer and involves an exercise of discretion.

Strathy C.J.O. noted that the trial judge is best equipped to determine the extent to which expert evidence is required, if at all, to assist him in the disposition of the issues. The exercise of the trial judge's "gatekeeper" function is therefore owed deference.

In this case, the trial judge had the task of determining the standards of care to be observed by police officers and a bus driver. In Strathy C.J.O.'s view, exercise of police powers of investigation, arrest and detention and police interactions with the public are "part of the daily diet" of a Superior Court judge. Technical knowledge or expertise was not required for the trial judge to determine whether the officers properly investigated Davis and whether they ought to have restrained him or persuaded him not to board the bus.  Moreover, the police training materials to which the expert referred were in evidence and were used on cross-examination of the officers. The trial judge did not require expert testimony to understand the standards set out in those materials or to determine whether the officers properly applied their training. Strathy C.J.O. observed that the trial judge considered and rejected each of the appellants' complaints that the police offers failed to meet their standard of care. It was open to him to conclude that expert evidence was not required to determine these issues.

Similarly, the trial judge reasonably decided that expert evidence was unnecessary to address the appellants' allegations of negligence against the Greyhound respondents, particularly their claims that the bus was traveling too fast at the time of the accident and that Dolph ought to have slowed down when he observed that Davis had left his seat. Strathy C.J.O. noted that these types of issues are frequently decided in motor vehicle negligence cases without the assistance of expert evidence.  Further, the record included evidence of Greyhound's practices and procedures and Dolph was thoroughly cross-examined with respect to his compliance with them. Strathy C.J.O. found that, as with the claims against the OPP officers, the trial judge considered all of the breaches of the standard of care alleged by the appellants against the Greyhound respondents and reasonably determined that he did not require expert assistance in doing so.

Strathy C.J.O. concluded that the trial judge did not err in excluding the evidence of either expert - rather, he properly exercised his gatekeeper function.

Strathy C.J.O. also rejected the appellants' submission that the trial judge failed to articulate the content of the applicable standard of care. He noted that the trial judge correctly identified the standard of care applicable to each defendant before examining each element of the standard advanced by the appellants and concluding that the standards of the reasonable police officer and the reasonable bus driver were met.

2.Ibrahim v. Robinson, 2015 ONCA 21 (Weiler, Feldman and Benotto JJ.A.), January 19, 2015

On its face, this appeal concerns the Ontario court's jurisdiction over a defendant in a motor vehicle collision action arising from an accident which occurred in Michigan. On closer inspection, the case raises the issue of what happens when significant developments in the law occur while a proceeding makes its way through the courts, particularly when those changes are to the detriment of one party to the litigation.

The appellant, the defendant in the action, brought a motion to dismiss based on a lack of jurisdiction. The motion judge declined to dismiss the action, citing the "forum of necessity exception" outlined by the Court of Appeal in Van Breda v. Village Resorts Limited, 2010 ONCA 84. Key to the motion judge's decision was the fact that the appellant delayed serving its jurisdiction motion until after Michigan's three-year limitation period had expired. He found that the appellant effectively denied the respondents access to the Michigan courts and that fairness and access to justice for the plaintiffs compelled the court to assume jurisdiction based on forum of necessity.

The appellant brought a subsequent motion seeking to introduce further evidence in an attempt to demonstrate that he had not misled the respondents about his intention to challenge jurisdiction. The motion judge found that the new evidence was available on the original motion and held that the appellant's only remedy was to appeal.

The appellant submitted before the Court of Appeal that the Ontario court lacked jurisdiction simpliciter over the action and that the forum of necessity doctrine does not become available simply because the limitation period in the proper forum had passed. He also argued that the motion judge erred in refusing to admit the fresh evidence and in concluding that he had lulled the respondents into a "false sense of security". 

Writing for the Court, Feldman J.A. observed the delay in the proceeding.  The action was commenced in January, 2010, but neither party took steps to advance the action until the underlying motion was heard in September, 2013.  During that time, the law on jurisdiction developed significantly. 

When the action was initiated, an Ontario court could have assumed jurisdiction under the test articulated in Muscutt v. Courcelles (2002), 60 O.R. (3d) 20 (C.A.), the governing authority with respect to jurisdiction at that time. By the time the motion was heard, however, the Supreme Court had released its decision in Club Resorts Ltd. v. Van Breda, 2012 SCC 17, [2012] 1 S.C.R. 572, refining the "real and substantial connection" test such that the factors linking the accident to Ontario were no longer sufficient to ground jurisdiction.

When Van Breda came before the Supreme Court, the high court considered the test for assuming jurisdiction, but explicitly declined to address the issue of forum of necessity. The Court of Appeal therefore maintained the final word on that issue. Writing for the Court of Appeal in Van Breda, Sharpe J.A. explained:

The forum of necessity doctrine recognizes that there will be exceptional cases where, despite the absence of a real and substantial connection, the need to ensure access to justice will justify the assumption of jurisdiction.  The forum of necessity doctrine does not redefine real and substantial connection to embrace "forum of last resort" cases; it operates as an exception to the real and substantial connection test.  Where there is no other forum in which the plaintiff can reasonably seek relief, there is a residual discretion to assume jurisdiction.

It was on this basis that the motion judge declined to dismiss the Ontario action for want of jurisdiction.

The law on jurisdiction developed still further since the motion judge rendered his decision in this case, however, with the Court of Appeal determining in West Van Inc. v. Daisley, 2014 ONCA 232, 119 O.R. (3d) 481, leave to appeal refused, [2014] S.C.C.A. No. 236, that the expiry of the limitation period in a proper foreign forum does not render Ontario the forum of necessity.

As Feldman J.A. observed, while both parties to the litigation were responsible for the delay, developments in the law during that time created a scenario that was uniquely unfavourable to the respondents.

Feldman J.A. noted that if the motion judge had invoked the forum of necessity exception on the basis of the expiry of the Michigan limitation period alone, the Court would be required to allow the appeal in accordance with its ruling in West Van. Because the limitation period was only one factor in the motion judge's decision, however, it was not inconsistent with West Van. The motion judge also considered the principles of fairness and access to justice, as well as the appellant's unexplained delay in bring the motion following the expiry of the limitation period in Michigan. These additional considerations permitted the motion judge's decision to stand in the face of West Van.

Feldman J.A. also declined to interfere with the motion judge's decision on the fresh evidence motion. The letters and emails discussing the appellant's intention to challenge the jurisdiction of the Ontario courts were available at the time of the original motion and would be of no assistance to the appellant's case.

3. Wesbell Networks Inc. v. Bell Canada, 2015 ONCA 33 (Strathy C.J.O., Rouleau and Hourigan JJ.A.), January 23, 2015

We return to principles of contractual interpretation as outlined by the Supreme Court in the recent case of Sattva Capital Corp. v. Creston Moly Corp. in this appeal concerning the interpretation of a supply agreement between two telecommunications companies.

The parties entered into a Master Supply Agreement (MSA), under which Wesbell Networks Inc. agreed to build and operate a Voice over Internet Protocol for Bell Canada. Wesbell leased the equipment used to construct the VoIP system from a third party under a five-year lease. Bell guaranteed Wesbell's performance of the lease under a provision of the MSA, which stipulated that if Bell terminated the agreement due to material breach by Wesbell, it would assume Wesbell's rights and obligations under the lease.

When Wesbell made an assignment in bankruptcy, Bell exercised its right to terminate the MSA for material breach and assumed Wesbell's rights and obligations under its third party equipment lease. Bell paid the lessor the $2 million owing under the lease for the remainder of the term. In its defence of a claim brought by Wesbell's receiver, BDO Dunwoody Limited, Bell sought to set off this payment against the balance it owed to Wesbell. Wesbell agreed that the impugned provision gave Bell a right of set-off against the amount it owed under the MSA but submitted, based on previous drafts of the MSA and evidence of the pre-contractual negotiations between the parties, that it was their intention that Bell would have no recourse against Wesbell for the remainder of the lease payments in the event of its material breach of the agreement.

The trial judge recognized that she was required to address the factual matrix of the MSA, but declined to consider the parties' subjective intentions in interpreting the agreement. She found that an "entire agreement" clause in the MSA required that she consider only the wording of the final agreement. In addition to stating that Bell would assume all of Wesbell's rights and obligations under the equipment lease in the event of Wesbell's material breach of the agreement, the MSA went on to provide that any such assumption "shall be on a fully paid-up basis free and clear of all encumbrances" and that Wesbell shall be responsible for and indemnify Bell against all of its "outstanding debts, defaults, encumbrances or obligations" with respect to the lease. The trial judge found that at the time of Wesbell's default it was obliged to pay the lessor liquidated damages in the amount of the balance owing for the remaining term of the lease. She concluded that the amount paid by Bell to the equipment lessor was a discharge of Wesbell's outstanding obligation and that, pursuant to the MSA, Wesbell was required to indemnify Bell for this payment. Bell was therefore entitled to a contractual right of set-off.

The appellant argued before the Court of Appeal that the trial judge failed to give effect to the parties' intentions in interpreting the MSA. Faced with this challenge, the Court of Appeal turned to the landmark case of Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, in which the Supreme Court provided guidance on the approach to contractual interpretation. As Rothstein J. explained in this recent decision, "[c]ontractual interpretation involves issues of mixed fact and law as it is an exercise in which the principles of contractual interpretation are applied to the words of the written contract, considered in light of the factual matrix."

Applying this principle to the case at bar, the Court found that the trial judge was alive to the "contractual matrix". She made thorough findings with respect to the creation of the MSA, its performance and its breach, correctly observing that the parties' subjective intentions were irrelevant to the construction of the agreement. She was also correct in declining to consider previous drafts of the MSA in interpreting the agreement in light of its "entire agreement" clause. The trial judge's interpretation of the agreement was consistent with the principles outlined by the Supreme Court in Sattva.

The Court briefly considered and rejected the appellant's submission that Bell's damages ought to have been limited to one year of lease payments on the basis that, if not for its breach of the agreement, Wesbell would have been entitled to terminate the MSA after the fourth year and Bell would have been required to assume the lease for the remainder of the term. In the Court's view, the appellant erred in defining the case as one of alternative methods of calculating damages. In fact, when Wesbell defaulted on the equipment lease, it became immediately liable to the lessor for the full amount of the remaining payments. In accordance with the MSA, it was required to indemnify Bell for this amount.

The Court did allow the appeal with respect to the trial judge's order that there be no costs, finding that she erred in focusing on the parties' individual successes on specific issues in the litigation and disregarding the overall success achieved by Wesbell. The Court noted that the general rule governing costs is that, absent exceptional circumstances, the successful party is entitled to its costs of a proceeding and observed that the trial judge identified nothing to justify a departure from that rule. The Court concluded that the appellant was entitled to its costs of the action, and allowed the appeal on that issue.

4. First Elgin Mills Developments Inc. v. Romandale Farms Limited, 2015 ONCA 54 (Epstein, Lauwers and Pardu JJ.A.), January 28, 2015

In this decision, the Court of Appeal considered a motion for a re-hearing of an appeal on the basis that the release of the Supreme Court of Canada's decision in Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, had altered the applicable standard of review.  The Court of Appeal released its original decision in this appeal last August. Just five days earlier, the Supreme Court issued its own ruling in Sattva.

The appeal turned on the interpretation of a price adjustment clause in an agreement for the purchase and sale of development land. Citing The Plan Group v. Bell Canada, 2009 ONCA 548, Lauwers J.A. described the standard of review as one of correctness, "with due deference to be paid to the application judge on those determinations in which the facts dominate". Although he agreed with a number of the application judge's observations about the agreement, Lauwers J.A. found that that he erred in characterizing the provision as a hard deadline by which the price adjustment had to be made and found in favour of the appellant, First Elgin Mills Developments Inc.

The moving parties on the motion for a re-hearing submitted that the standard of review articulated in Sattva directs a greater degree of appellate deference than the Court afforded the application judge on appeal. They argued that the interests of justice required that the Court hear the appeal again.

In Sattva, Rothstein J. emphasized that contractual interpretation involves issues of mixed fact and law, "as it is an exercise in which the principles of contractual interpretation are applied to the words of the written contract, considered in light of the factual matrix." He went on to state, however, that "it may be possible to identify an extricable question of law from within what was initially characterized as a question of mixed fact and law", citing legal errors including the application of an incorrect principle, the failure to consider a required element of a legal test and the failure to consider a relevant factor.

In its brief endorsement in First Elgin, the Court noted that while it has jurisdiction to reconsider a decision prior to the issuance of a formal order, it will only re-open an appeal in the "rare circumstances" in which it is in the interests of justice that it withdraw its reasons and re-hear the case on the merits.  This, in the Court's view, is not one of those circumstances.

The Court reiterated that the application judge misapprehended the evidence, interpreted the agreement in a manner that was commercially unreasonable and improperly implied a term in the agreement. Its conclusion was not driven by the standard of review. Moreover, the result would be no different under the Sattva standard. As First Elgin Mills pointed out, the application judge's errors were legal ones; they therefore attracted the standard of correctness in accordance with Sattva. Despite not referring to Sattva in deciding the appeal, the Court's conclusion was consistent with the principles outlined by the Supreme Court in that case.

The Court concluded that no serious injustice would result if it declined to re-hear the appeal. The moving parties' request was denied.

5. Moore v. Getahun, 2015 ONCA 55 (Laskin, Sharpe and Simmons JJ.A.), January 29, 2015

This appeal, which arose from an orthopedic surgeon's treatment of a young patient, raised important questions for counsel about the preparation and use of expert reports.

Following a motorcycle accident, Blake Moore was brought to Scarborough General Hospital, where he was treated by the appellant, Dr. Tajedin Getahun, a recently qualified orthopedic surgeon, for a fracture to his right wrist. The appellant applied a full circumferential cast to the respondent's wrist and forearm. Moore suffered permanent damage to his arm due to compartment syndrome, which he alleged was caused by the appellant's negligence in applying a full cast.

The central issue at trial was whether the appellant had fallen below the standard of care by applying a full circumferential cast to Moore's wrist and whether the full cast caused compartment syndrome.  Due to the technical nature of the case, much of the trial turned on the evidence of medical experts.

The trial judge preferred the evidence of the respondent's expert witness over those of the appellant, and found that the application of the full circumferential cast was a breach of the standard of care and had caused compartment syndrome to develop.

At the heart of the appeal was the trial judge's comments concerning the role of counsel in the preparation of expert witness reports.  The most significant issue raised before the Court involved the preparation of the written report of one of the appellant's expert witnesses. The trial judge's conclusion that it was improper for counsel to assist the expert in the preparation of his report was strongly challenged by the appellant and by a number of interveners, including the Ontario Lawyers' Association and the Canadian Institute of Chartered Business Valuators. The Canadian Defence Lawyers Association submitted that the trial judge's ruling was "unprecedented, unsupported in law and seriously flawed".

Also at issue on appeal was the trial judge's use of the appellant's expert witness reports. These reports were not entered into evidence as exhibits - rather, the experts testified in court and their reports were made available to the judge as aide memoires. In assessing the credibility of the expert witnesses, the trial judge considered what she perceived to be contradictions between the appellant's experts' written reports and their viva voce evidence. The appellant submitted that she did so in error.

Counsel for the respondent agreed with the appellant that the trial judge erred in regard to both issues involving the experts, but argued that the errors had no impact on the trial's outcome.

Writing for the Court of Appeal, Sharpe J.A. found that the trial judge erred in holding that it was unacceptable for counsel to review and discuss draft expert reports. While some judges have expressed concern that the impartiality of expert evidence may be compromised by discussions with counsel, "banning undocumented discussions between counsel and expert witnesses or mandating disclosure of all written communications is unsupported by and contrary to existing authority". Moreover, the independence and objectivity of expert witnesses is fostered under existing law and practice.

Sharpe J.A. agreed with the appellant and interveners that it would be bad policy to disturb the well-established practice of counsel meeting with expert witnesses to review draft reports: "Just as lawyers and judges need the input of experts, so too do expert witnesses need the assistance of lawyers in framing their reports in a way that is comprehensible and responsive to the pertinent legal issues in a case." Moreover, "consultation and collaboration" between counsel and expert witnesses is required to ensure that the expert witness understands his duties under rule 4.1.01 and those contained in Form 53.

Sharpe J.A. emphasized that counsel "play a crucial mediating role" in explaining the legal issues to the expert witness and in presenting complex expert evidence to the court. Counsel could not perform this function without communicating with the expert as the report is being prepared. Moreover, leaving the expert witness "entirely to his or her own devices", or requiring that all changes be documented in a formal written exchange, would result in increased delay and costs.

Sharpe J.A. found that the trial judge further erred in law in using written expert reports that were neither entered into evidence nor the subject of cross-examination to discredit aspects of the evidence tendered by the appellant's expert witnesses at trial. If an expert's report has not been entered into evidence as an exhibit, it has no evidentiary value, even if provided to the trial judge as an aide memoire. Inconsistencies between the viva voce evidence of an expert witness and his written report are the proper subject of cross-examination but, in the absence of a cross-examination, it is not open to a trial judge to place any weight on perceived inconsistencies in assessing the expert's credibility.

Sharpe J.A. ultimately agreed with the respondent, however, that these errors were not a significant factor in leading the trial judge to prefer the evidence of the respondent's expert, and did not render the trial unfair and cause a substantial wrong or miscarriage of justice.

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Angus T. McKinnon
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