Canada: December 2016 Pensions Newsletter


Webb v. TD, 2016 ONSC 7153

In 2005, a former branch manager of TD Bank (Plaintiff), after being terminated, elected to invest the commuted value of his pension in a retirement investment account with TD Waterhouse Canada Inc., TD Waterhouse Financial Planning and Kim Myers, a financial advisor and employee of TD Waterhouse Financial Planning (Defendants). By 2009 and 2010, the Plaintiff noticed that the investment did not perform as well as initially represented in 2005, and filed a statement of claim in January 2014 alleging misrepresentation, undue influence, negligence, and failure to provide or require the Plaintiff to obtain independent legal advice in the context of presumed conflict of interest and/or undue influence. The Defendants moved for summary judgment based on a limitation defence.

In granting the Defendants' motion, the Ontario Superior Court of Justice (Court) relied on various facts which indicated that the Plaintiff knew or ought to have known of the claim as early as 2009.

The Court further held that, even if the claim was not statute-barred, there were no facts that raise a presumption of undue influence requiring a trial. The Defendants and the Plaintiff's relationship did not have the degree of influence and dependency that can be subject to abuse and pressure. The Court found that the Plaintiff had the capacity for independent action, made independent inquiries and made independent choices, at times against the advice of Ms. Myers. His education, training, work history and knowledge of markets and investments indicated that he was not a vulnerable party. The Plaintiff was well aware of the affiliation between the Defendants and his former employer, and sought Ms. Myers out based on his personal knowledge, rather than at her solicitation of business. He was not incapable of obtaining independent legal advice, and nothing interfered with his ability to obtain legal advice. Finally, he knew or ought to have known that there was no guarantee in the representation of returns made in 2005, based on the representation documents and his knowledge of markets.

Ontario Superior Court of Justice Decision


Tibbett & Britten Group Canada Inc. v. Sobeys Inc., 2016 ONCA 861

In January 1995, Oshawa Foods (Oshawa) and Surelink entered into parallel asset sale and warehouse and transportation services transactions, wherein Oshawa sold two warehouses to Surelink, and Surelink provided warehousing and transportation services to Oshawa in connection with Oshawa's food distribution business. Under the warehousing and transportation agreement (WTA), Surelink assumed responsibility for the former employees of Oshawa who were working in the warehouses, including responsibility for the benefits under an existing pension plan (Plan). Following its acquisition of Oshawa in 1999, Sobeys Inc. (Sobeys) terminated the agreements, which terminated all of the positions of the Surelink employees at the two warehouses and triggered a wind-up of the Plan effective March 5, 2000.

In determining the extent to which the obligations for the pension benefits reverted to Sobeys on termination of the agreement, the application judge held that (1) the termination provisions of the WTA required Sobeys to reimburse Tibbett & Britten Group Canada Inc. (Tibbett), Surelink's successor, for the amount required to fund the deficit that arose on the wind-up of the Plan, and (2) Sobeys and Tibbett reached a new agreement in or around August 2001 pursuant to which Sobeys agreed to be responsible for directly funding the Plan deficit and ongoing administration of the Plan.

Sobeys appealed the decision, arguing that (1) it was only obliged to reimburse Tibbett for the reasonable costs incurred in funding the Plan deficit, and (2) it did not agree to assume responsibility for directly funding the Plan deficit. Alternatively, Sobeys argued that Tibbett's claim, either under the WTA or pursuant to any new agreement, was statute-barred under the Limitations Act, 2002.

Finding no palpable and overriding error in the application judge's finding of fact or of mixed fact and law, the Ontario Court of Appeal (Court) dismissed Sobeys' appeal. The Court found that the application judge made a factual finding that Tibbett had acted with due diligence, and saw no basis for interfering with it. Similarly, the Court agreed with the application judge's finding of a new agreement based on the factual record, the parties' conduct and the business context. Lastly, the Court held that the limitation period for Tibbett did not begin to run until April 17, 2013, as Tibbett was entitled to assume that Sobeys undertook to fulfill its obligations with respect to the Plan under the WTA and the subsequent agreement between the parties in the absence of indication to the contrary.

Ontario Court of Appeal Decision


Jacques v. The Queen, 2016 TCC 245

The taxpayer, Julie Jacques, had a sister resident in the United States who passed away. Ms. Jacques was named as the death beneficiary for her sister's retirement plan, a 401(k) plan. The Minister of National Revenue reassessed Ms. Jacques to include the proceeds of this plan in her income for 2009. The issue to be decided was whether the proceeds received from the 401(k) plan met the definition of "superannuation or pension benefits" under s. 248(1) of the Income Tax Act (Canada), which is defined as "any amount received out of or under a superannuation or pension fund or plan."

Justice Graham was tasked with determining whether the 401(k) plan is a superannuation or pension fund or plan. This was a question of fact. In analyzing the 401(k) plan, Justice Graham looked for factors that set the plan apart from an ordinary savings plan. The factors he found that leant themselves to the 401(k) plan being a superannuation or pension fund or plan are (1) the employer was expected to make contributions and (2) the vesting schedule of employer contributions. Certain factors were neutral: the purpose of the plan; the ability of an employee to opt out of the plan; and an employee's ability to direct investments. Many factors suggested the plan is more like a savings plan: the ability to significantly vary employee contributions (up to 50 per cent); the ability to withdraw amounts early; and the distribution methods available out of the plan.

Justice Graham stated that the distribution methods were the most significant feature. According to Canadian jurisprudence, a superannuation or pension fund or plan provides payment of "regular post-retirement income." The 401(k) plan in question paid out lump sums by default, and employees aged 59.5 or older were permitted to withdraw some or all of their balance and continue to work. Any employees retiring before age 70.5 were required to take a lump sum. In fact, Justice Graham identified that the only way to receive regular payments post-retirement was to work past age 70.5 and then choose to not receive a lump-sum payment, thereby triggering minimum annual distributions. In that situation, the employee would still be entitled to withdraw lump sums at will.

Justice Graham concluded that, upon a total review of the plan in question, it was not a superannuation or pension fund or plan, and allowed Ms. Jacques's appeal of her income tax reassessment by referring the matter back to the Minister of National Revenue for reconsideration and reassessment.

Tax Court of Canada Decision


Walter Energy Canada Holdings, Inc. (Re), 2016 BCSC 107; 2016 BCSC 1746

The Walter Group, a U.S.-based metallurgical coal-exporting group of companies, purchased Canadian coal mines in 2011. Due to the decline in global demand for its product, the Canadian coal mines, as well as other Walter Group coal mines across the world, were idled and the Walter Group experienced major financial difficulties. The Walter Group filed for Chapter 11 bankruptcy protection in the United States, and its Canadian operations filed for creditor protection under the Companies' Creditors Arrangement Act (CCAA). The initial order in the CCAA proceedings was granted in December 2015. In early 2016, the parties sought various forms of relief to assist in the restructuring plan, including the court approval of a sale and solicitation process and the appointment of further professionals to manage that process; the approval of an employment retention plan; and an extension of the stay against creditors' collection efforts. In her decision on January 26, 2016, Justice Fitzpatrick granted the requested relief and noted the novel objections made by the United Mine Workers of America 1974 Pension Plan and Trust (1974 Pension Plan), discussed below.

One of the American entities within the Walter Group is Jim Walter Resources Inc. (JWR). This company is party to a collective agreement with the United Mine Workers of America. In December 2015, the bankruptcy court in the United States ruled that JWR was permitted to reject the collective agreement and further ruled that the sale of the U.S. assets of the Walter Group would be free and clear of any liabilities under the collective agreement. In response, the trustees of the 1974 Pension Plan filed a proof of claim in the U.S. bankruptcy proceedings for a contingent claim against JWR for a potential "withdrawal liability" under the Employee Retirement Income Security Act of 1974 (USA) (ERISA) of approximately US$900-million. In this CCAA proceeding, the 1974 Pension Plan argued that, under ERISA, all companies under common control with JWR are jointly and severally liable for this withdrawal liability. The 1974 Pension Plan alleges that certain Canadian companies within the Walter Group fall within this joint and several liability provision. The claim, if valid, would have the potential to overwhelm most other claims against the estate of the Canadian operations.

In August 2016, the company sought approval of the sale of one of the Canadian mining operations. At the same hearing, the petitioners sought an order governing the distribution of the proceeds of the sale. In her September 23, 2016 decision, Justice Fitzpatrick addressed the ERISA claim directly. Her ruling indicates that due to the procedural and legal complexity of the claim, the parties had agreed to not file a proof of claim under the CCAA proceedings (which is the ordinary procedure for a claim against a CCAA protected company), and instead the petitioner would file an independent civil claim. Therefore, the merits of the ERISA claim were not decided, but will be litigated in the near future in parallel proceedings, to which the parties on the service list for the CCAA proceedings would be entitled to participate.

January 2016 B.C. Supreme Court Decision

September 2016 B.C. Supreme Court Decision

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.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
23 Jan 2018, Seminar, Toronto, Canada

Blakes invites you to attend a seminar focused on the importance of intellectual property, with a particular emphasis on the oil and gas sector. Blakes lawyers and patent agents will highlight the key elements of each topic listed below and provide forecasts and constructive recommendations.

24 Jan 2018, Seminar, Toronto, Canada

We invite you to join members of our National Restructuring & Insolvency Group as they review key restructuring and insolvency developments and trends across Canada in 2017.

31 Jan 2018, Seminar, Toronto, Canada

The Supreme Court of Canada and the Alberta Court of Appeal issued a number of decisions over the past five years that have significantly impacted businesses and commercial disputes.

In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions