Canada: Court Of Appeal Summaries (August 2-5, 2016)

Last Updated: August 12 2016
Article by John Polyzogopoulos

Hello again everyone.

There were only three civil decisions of any note this week. Two were family law cases, one involving an attack on fraudulent conveyances perpetrated by a husband who owed support and equalization payments. The other was a "priority dispute" between insurers in the statutory accident benefits context to determine which insurer was responsible to pay SABs to the accident victims.

Enjoy the weekend.

John Polyzogopoulos

Blaney McMurtry LLP

D'Angelo v. Barrett, 2016 ONCA 605

[Hoy A.C.J.O., Brown and Huscroft JJ.A.]


Julian W. Lipkowski, for the appellant

Gary S. Joseph and Meghann P. Melito, for the respondent

Keywords: Endorsement, Family Law, Family Law Act, Custody and Access, Net Family Property, Equalization, Constructive Trust, Standard of Review, Van de Perre v. Edwards, 2001 SCC 60


The parties married in 2000 and had two children. They separated in 2011. The application judge ordered that the children's primary residence be with the respondent wife, with generous access awarded to the appellant husband. The respondent was also ordered to pay the appellant $43,092 in equalization. The appellant challenges the application judge's decision on custody and equalization. With respect to the custody decision, there was a report from the Office of the Children's Lawyer ("OCL") that recommended that the appellant be awarded sole custody. The appellant challenges the decision not to award him a constructive trust over half the matrimonial home. The trial judge did not do so because it was owned by the respondent's mother, no claim was made against her and she was not a party to the proceeding. In addition, the appellant challenges the trial judge's ruling on equalization when he allowed the respondent to deduct from her net family property the loans made by the respondent's mother.


  • Did the application judge err in awarding the respondent custody?
  • Did the application judge err in dismissing the appellant's constructive trust claim against the mother's 50% interest in the matrimonial home?
  • Did the application judge err in allowing the deduction of the mother's loans in calculating the equalization payment?

Holding: Appeal dismissed.


  • The decisions of trial judges on custody and access are entitled to a high degree of deference. An appellate court is not to overturn a custody order in the absence of a material error, a serious misapprehension of the evidence, or an error in law: Van de Perre v. Edwards. It was for the application judge to determine the best interests of the children, and the report of the investigator of the OCL was simply evidence in this regard. The application judge was under no obligation to accept the report or the recommendations of the investigator, either in whole or in part.
  • The respondent's mother was listed on title as a 50% owner of the matrimonial home. The appellant brought no claim against the respondent's mother. She was not a party to the proceedings against the respondent and no order affecting her 50% ownership interest in the home could be made. The application judge correctly concluded that testifying at trial was not the same as being a party to a proceeding and defending a claim. It is undisputed that the respondent's mother contributed towards the purchase of the home and is listed on the title as a joint owner. The appellant did not bring a claim to challenge her property entitlement. Therefore, the application judge did not err in finding that the respondent's mother owned 50% of the home, and that only the 50% owned by the respondent was relevant for equalization purposes.
  • With respect to the loans, the appellant argued that the loans should not have been deducted because they were forgivable. However, at trial, the mother testified that she expected to be repaid and that she made a demand for repayment on September 19, 2012. The trial judge saw her as a credible witness and accepted her evidence. There is, therefore, no basis to interfere with the decision.

Purcaru v. Seliverstova, 2016 ONCA 610

[Sharpe, Lauwers and Miller JJ.A.]


Gary S. Joseph and Kenneth Younie, for the appellants

Morris Cooper, for the respondent

Keywords: Family Law, Fraudulent Conveyances, Fradulent Conveyances Act, Fraudulent Intent, Burden of Proof, Fresh Evidence


This appeal is from an order awarding relief to the respondent under provisions of the Fraudulent Conveyances Act. The respondent's ex-husband, Don Purcaru ("Mr. Purcaru") and the appellant, Marine Seliverstova ("Ms. Seliverstova"), who had been in a relationship with Mr. Purcaru, were found to have acted in concert to convey property to Ms. Seliverstova with the intention of defeating Mr. Purcaru's creditors, chiefly the respondent.

Mr. Purcaru had financial obligations to the respondent due to their matrimonial proceedings. After a trial in 2009, Mr. Purcaru was ordered to pay the respondent in excess of $1 million in arrears of spousal and child support and for equalization of net family property. In the current proceedings, the trial judge made an order voiding the transfers of funds from Mr. Purcaru that had enabled Ms. Seliverstova to purchase two residential condominium units in 2006 and 2008.


  1. Did the trial judge err by impermissibly shifting the burden of proof to the appellants, requiring that they disprove the respondent's allegations?
  2. Did the trial judge err by not assessing the requisite fraudulent intent at the time of the transactions?
  3. Did the trial judge err in law by engaging in speculation in order to make factual findings that were not supported by the evidence?
  4. Did the trial judge err in exercising his discretion to fix a rate of prejudgment interest other than the rate prescribed by s. 127 of the Courts of Justice Act?
  5. Should leave be granted to the appellants to introduce fresh evidence?

Holding: Appeal dismissed and motion for leave to introduce fresh evidence dismissed.


  1. No. The trial judge correctly stated the law with respect to burden of proof where there is an allegation of a fraudulent conveyance. It is up to the challenger of a transaction to establish on a balance of probabilities that a conveyance was made with the intent to 'defeat, hinder, delay or defraud creditors or others', within the meaning of s. 2 of the Fraudulent Conveyances Act. Whether Mr. Purcaru had that intention is a question of fact, to be determined from the circumstances at the time of the transactions. If a challenger raises evidence of one or more 'badges of fraud' that can give rise to an inference of an intent to defraud, the evidential burden then shifts to those defending the transaction to adduce evidence showing the absence of fraudulent intent.

Among the badges of fraud identified by the trial judge in this case were: (1) the transactions between Mr. Purcaru and Ms. Seliverstova were not at arm's length, (2) the transactions were not only secretive but they were in violation of Mr. Purcaru's disclosure obligations under the Family Law Rules, and (3) the transactions were made without consideration.

The evidential burden then fell on Ms. Seliverstova to adduce evidence to show that the purpose of the transactions was not to defeat Mr. Purcaru's creditors. Both Seliverstova and Mr. Pucaru's explanations in testimony were found 'to be lacking in cogency and credibility.' As held in FL Receivables Trust 2002-A (Administrator of) v. Corbrand Foods Ltd., findings that transactions are fraudulent by the trial judge are entitled to deference and there is no basis upon which the court should interfere with them.

  1. No. The requisite fraudulent intent is to be assessed at the time of the impugned transactions. The appellants contend that the trial judge erred by attributing to the appellants knowledge, in 2006 and 2008, of the outcome of the family law proceedings between Mr. Purcaru and the respondent that culminated in the order in 2009. They argue that, until that order was made, they could not have known that Mr. Purcaru would have such a substantial liability to the respondent. Therefore, when the condominiums were purchased in 2006 and 2008, they could not have formed the intent to defeat the claims of creditors.

The Court of Appeal rejected this argument for the reasons given by the trial judge, who found that 'once the applicant commenced her application for divorce and corollary relief, the applicant became a contingent creditor of Dan Purcaru with 100% likelihood of obtaining some award or settlement.' The trial judge also found on the evidence that Ms. Seliverstova also knew of the divorce proceedings that the time of the transactions and engaged in the transactions with the intent to defeat the respondent's claim.

  1. No. The trial judge surveyed the records of the financial dealings of the appellants that were available. He did not have a complete picture of their dealings, which he suspected was deliberate. The trial judge made findings of fact from the evidence that was before him and drew inferences from those findings.
  2. This argument was not strenuously pursed in oral argument and the Court of Appeal saw no merit in it.
  3. No. The appellants were denied leave to introduce as fresh evidence on the appeal an affidavit from Ms. Seliverstova providing additional bank records in support of her argument that the funds she received had come from her mother in Russia and not Mr. Purcaru. The bank records do not show the source of the funds that were in the account and, therefore, were of no assistance in resolving the matters in dispute in the litigation. Furthermore, this evidence could have been discovered previously by Ms. Seliverstova, exercising due diligence.

Intact Insurance Company v. Allstate Insurance Company of Canada, 2016 ONCA 609

[Sharpe, LaForme and van Rensburg JJ.A.]

Todd J. McCarthy and Frank A. Bennedetto, for the appellant

Douglas A. Wallace and Tori Chapman, for the respondent

Keywords: Insurance Law, Statutory Accident Benefits, Definition of "Dependent", Administrative Law, Appeals, Standard of Review, Reasonableness, Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235, Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190


Paula separated with her husband, Yvan, and moved from Sudbury to Sarnia to live with a new man she met named Kyle. Paula's two children, Destiny and Athena, made the move with Paula (together they are the 'Claimants'), and they all lived at Kyle's home in Sarnia, effective July 2010. The move was considered permanent. Destiny and Athena were to be enrolled in school in Sarnia in September and Paula was planning on looking for a job at that time.

After their move to Sarnia, Kyle was responsible for most of the expenses as Paula was not contributing to household expenses or paying any of the bills (Kyle paid for at least 64 percent of the Claimants' financial needs).

On August 18, 2010 Paula's friend drove the Claimants to Canada's Wonderland and then to Sudbury, to retrieve the rest of their belongings. On their way back to Sarnia on August 21, they were involved in a car accident. Paula suffered relatively minor injuries, but Destiny and Athena sustained catastrophic injuries.

The Claimants applied for and received accident benefits from Intact, the insurer of the vehicle in which they were passengers at the time of the accident. However, Intact argued that Allstate, which insured two other vehicles owned by Kyle, should pay those benefits. Intact took the position that Allstate was obligated to pay because the Claimants were dependent on Kyle at the time of the accident, and, consequently, they were insured's under Allstate's policies with Kyle.

The parties submitted their 'priority dispute' to an arbitrator, who decided the Claimants were not principally dependent for financial support on Kyle at the time of the accident. Therefore, Intact was responsible for the accident benefits. Intact appealed.

The appeal judge concluded that the arbitrator had committed an error of law by importing a permanency requirement into the analysis and an error in principle by speculating about future events. Because of these errors, the appeal judge reviewed the decision on a correctness standard of review, and set aside the decision, concluding that Allstate was responsible for paying the accident benefits owed to the Claimants. Allstate appealed to Court of Appeal and argued that the appeal judge erred by reviewing the arbitrator's decision on a correctness standard and that the arbitrator's decision should be restored because it was reasonable.


  • Did the appeal judge err in reviewing the arbitrator's decision on a correctness standard?
  • Should the decision be restored because it was reasonable?


Appeal dismissed.


Yes. There are two different frameworks for determining the standard of review on an appeal: (i) the "appellate" framework articulated in Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235; and (ii) the "administrative law" framework associated with Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190.In general, decisions rendered by non-judicial decision makers (which is the case here) should be reviewed using an administrative law framework .

Generally, determining whether a person is "principally dependent" on another is a question of mixed fact and law: Oxford Mutual, at para. 23. Such questions are presumptively reviewed for reasonableness: Tervita Corp. v. Canada (Commissioner of Competition), 2015 SCC 3, [2015] 1 S.C.R. 161, at para. 40. This court has already confirmed that, on appeals from insurance arbitrations involving an interpretation of dependency under SABS, mixed fact and law questions are reviewed for reasonableness: Oxford Mutual, at para. 23.

In general, an appeal to the Superior Court from an insurance arbitration regarding a priority dispute will engage questions of mixed fact and law that must be reviewed for reasonableness. Even if the appeal involves an extricable question of law regarding SABS, a reasonableness standard of review will still generally apply. In the unlikely scenario that the issue before the insurance arbitrator is an "exceptional" question (one of jurisdiction, a constitutional question, or a general question of law that is both of central importance to the legal system as a whole and outside the adjudicator's specialized area or expertise), a correctness standard of review may be applicable.

In this case, there was no basis for applying a correctness standard of review. Therefore, this court must correct the appeal judge's error by reviewing the arbitrator's decision under a reasonableness standard.

  • The arbitrator's decision was unreasonable. He conducted an improper dependency analysis through creating and applying an arbitrary 'permanence' test. The arbitrator chose the year-long period solely because, in his view, "it would be inappropriate to use the seven week period relationship was not one of permanence." Specifically, the arbitrator concluded that that he should accept a "short" time frame only in cases where the relationship at issue is likely permanent. That approach conflicts with legal principles laid down in jurisprudence.

It is well established that, when conducting a dependency analysis, the arbitrator was required to look at the relationship between the Claimants and Kyle during a "period of time which fairly reflects the status of the parties at the time of the accident" (emphasis added): Oxford Mutual, at paras. 26-27; see also Dominion of Canada, at paras. 29-31; Gore Mutual Insurance Co. v. Co-operators General Insurance Co. (2008), 93 O.R. (3d) 234 (S.C.), at para. 8. The time period chosen for a dependency analysis must reflect the facts of the case: Oxford Mutual, at para. 26. Simply put, the jurisprudence has rejected a categorical or one-size-fits-all approach.

In large part because of the approach he adopted, the arbitrator's decision is inconsistent with the evidence in this case. When considered in light of the facts of this case, it is clear that the seven-week period accurately reflects the nature of the relationship between Kyle and the Claimants at the time of the accident.

The evidence indicates that Kyle and Paula believed that they were building a real relationship. They had a plan to enroll Athena and Destiny in a school in Sarnia. Paula was supposed to find a new job to help support this new household. There was even some talk of Paula and Kyle getting married.

When considered under the proper approach, the seven-week period preceding the accident does not merely present a "snapshot" of the relationship between Kyle and the Claimants. Rather, the seven-week period is the one that appropriately represents the true nature of the relationship at the time of the accident: a nascent but real relationship wherein the Claimants were principally dependent on Kyle for financial support. As such, even though the appeal judge erred in the standard of review, he did not err by setting aside the arbitrator's decision.

Vanden Bussche Irrigation & Equipment Limited v. Kejay Investments Inc., 2016 ONCA 613

[Weiler J.A. (In Chambers)]

Stephen Pickard, for the moving party

No one appearing for the responding party

Keywords: Endorsement, Summary Judgment, Limitation Periods, Appellate Jurisdiction, Final or Interlocutory Orders

Facts: Kejay is the defendant in an action brought by Vanden for payment for equipment it supplied to Kejay. Kejay brought a motion for summary judgment to dismiss the action against it on the basis that the limitation period for bringing the action had run and the action was statute-barred.

The applicant now seeks an order permitting the late filing of a notice of appeal. The respondent takes no position on the motion and did not appear although duly served.

Held: Motion dismissed.


Although the limitation period defence was the only issue before the motion judge and he purported to decide it, he also refused to grant summary judgment on the claim to the plaintiff and sent the matter on for trial. The Court of Appeal held that there would not have been any reason for the judge to refuse to grant summary judgement unless he was of the opinion that there was a genuine issue requiring a trial respecting the limitation period.

As such, the Court of Appeal concluded that the motion judge's determination that the limitation period had not run is not binding on the trial judge and is an interlocutory and not a final order. Accordingly, if the Court were to grant leave to extend the time to file a notice of appeal, it would not have jurisdiction to entertain the appeal and for this reason the motion is dismissed.

Short Civil Endorsements

MEDIchair LP v. DME Medequip Inc, 2016 ONCA 608

[Feldman, MacPherson and Miller JJ.A.]


D.S. Altshuller and J. Pocock, for the appellants

R.S.M. Woods and P. Smiley, for the respondent

Keywords: Addendum, Costs

Criminal Decisions

R v. Ontario Corporation 1796926, 2016 ONCA 612

[Gillese J.A.]


J.M. Poitras, for the moving party

  1. Zhai, for the responding party

Keywords: Criminal Law, Leave to Appeal, Provincial Offences Act, Section 131, Public Lands Act, Section 28, Fish and Wildlife Conservation Act, Section 10(1)(a)

R v. Wookey, 2016 ONCA 611

[Gillese, Watt and Tulloch JJ.A.]


J.S. Wilkinson, for the appellant

  1. Wilson, for the respondent

Keywords: Criminal Law, Food and Drugs Act, Definition of "Drug", Statutory Interpretation, Constitutional Law, Canadian Charter of Rights and Freedoms, s. 7

R v. Dunkley, 2016 ONCA 597

[Watt, Lauwers and Hourigan JJ.A.]


Breana Vandebeek, for the appellant

John Patton, for the respondent

Keywords: Criminal Law, Firearms, Evidence, Search and Seizure, Highway Traffic Act, Section 221(1), Canadian Charter of Rights and Freedoms, Section 24(2)

R v. Ellis, 2016 ONCA 598

[Watt, Lauwers and Hourigan JJ.A]


Candice Suter, for the appellant

John Patton, for the respondent

Keywords: Criminal Law, Firearms, Evidence, Search and Seizure, Highway Traffic Act, Section 221(1), Canadian Charter of Rights and Freedoms, Section 8, Section 9, Section 10, Section 24(2)

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

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