Canada: Court Of Appeal Summaries (March 13 – 17, 2017)

Last Updated: March 29 2017
Article by John Polyzogopoulos


There were only three short procedural decisions we summarized this week.

Have a good one.

Civil Decisions:

Castronovo v. Sunnybrook & Women's College Health Sciences, 2017 ONCA 212

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

W. G. Scott, for the appellants
B. Pickard and E. Murtha, for the respondents

Keywords: Endorsement, Civil Procedure, Limitation Periods, Pleadings, Amendments, Extension of Time, Rules of Civil Procedure, r. 3.02

In a June 9, 2016 order, Archibald J. directed that, if advised, the appellants were to serve and file a motion to amend their defence to advance a limitation period defence by June 17, 2016. The appellants served their notice of motion, seeking leave to amend their statement of defence to plead a limitations defence on August 17, 2016. Myers J. heard their motion on October 6, 2016. The appellants asserted that the respondents should have discovered their claim against them in 2007 and the claim was accordingly statute-barred.

The motion was dismissed on the grounds that the appellants had failed to show why it was in the interests of justice to grant the requested extension of time under r. 3.02 of the Rules of Civil Procedure. The motion judge held that Archibald J.'s order was a consent order and found the appellants had not explained why they waited seven years from being added as parties or two months after the deadline prescribed in the consent order to file and serve their motion. He noted that Archibald J.'s order specifically contemplated counsel's need for instructions. Moreover, it was common ground that the trial date would be lost if leave to amend were granted. "Delay matters", he wrote. And if the appellants advanced a limitations defence, the respondents' counsel would be a key witness and the respondents would need to find new counsel in a 13-year old case.


Did the motion judge err:
(i) in concluding Archibald J.'s order was a consent order;
(ii) in concluding the appellants had not adequately explained the delay; and
(iii) by considering prejudice other than prejudice arising from their two-month delay in complying with Archibald J.'s order?


Appeal dismissed.


The motion judge, Myers J., did not err in concluding that the appellants had failed to show that it was in the interests of justice to grant the requested extension. The un-contradicted evidence before Myers J. was that all counsel had agreed to the timeline ordered by Archibald J. The fact that the parties had consented to the order, the very late stage in this long-outstanding litigation at which the appellants raised the possibility of amending their defence, and the impact on the litigation – what Myers J. characterized as "prejudice" – if the appellant brought the motion to amend, all required that the appellants provide a compelling explanation for their non-compliance with the consent order. Myers J.'s conclusion that the appellants had failed to satisfactorily explain their non-compliance is supported by the record. There is no basis to interfere with the order of Myers J. dismissing the appellants' motion.

Nortel Networks Corporation (Re), 2017 ONCA 210

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

J. Holley and J. Greg McAvoy, the moving parties, acting in person
B. Zarnett, J. A. Kimmel and P. B. Kolla, for the responding party, the Monitor, Ernst & Young Inc.
D. C. A. Tay and J. Stam, for the responding parties, the Canadian Debtors
M. Zigler, S. L. Philpott and B. A. Walancik, for the responding parties, the Canadian Former Employees and Disabled Employees through their court appointed Representatives
J. B. Payne and T. J. McRae, for the responding party, the Nortel Canadian Continuing Employees
P. Mitchell, for the responding party, the EMEA Debtors (other than Nortel Networks S.A.)
S.R. Block, S. A. Bomhof, A. D. Gray, A. M. Slavens and J. R. Opolsky, for the responding parties, Nortel Networks Inc. and the other U.S. Debtors
R. Shayne Kukulowicz, M. J. Wunder, R. C. Jacobs and G. B. Shaw, for the responding party, the Official Committee of Unsecured Creditors of Nortel Networks Inc., et al
S. Richard Orzy, G. H. Finlayson and R. B. Swan, for the responding parties, the Ad Hoc Group of Bondholders

Keywords: Endorsement, Bankruptcy and Insolvency, Civil Procedure, Leave to Appeal, Companies' Creditors Arrangement Act

Joseph McAvoy and Jennifer Holley (the "Leave Applicants"), seek leave to appeal the Sanction Order of Newbould J. dated January 24, 2017. The Monitor, the Canadian and US Debtors, Nortel Networks Inc., the Official Committee of Unsecured Creditors, the Ad Hoc Committee of Bondholders, the Nortel Continuing Employees, and the Court Appointed Representatives of the Former and Disabled Employees of Nortel all oppose the motion.

Should leave be granted to appeal the Sanction Order of Newbould J. dated January 24, 2017?

Motion denied.

No. Leave should not be granted. Leave to appeal is granted sparingly in Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-36 ("CCAA") proceedings and only where there are serious and arguable grounds that are of real and significant interest to the parties. The stringent test for leave is not met in this case. The proposed appeal is not meritorious. As the supervising judge explained in his reasons, the Leave Applicants did not opt-out of the 2009 Representation Order for Disabled Employees ("LTD Rep Order") and they are bound by the 2010 Employee Settlement Agreement. The supervising judge correctly concluded the Leave Applicants have no right to opt out of the LTD Rep Order at this late stage. Further, the Court has already emphasized that further delays in this very protracted litigation are to be avoided.

Mihaylov v. 1165996 Ontario Inc., 2017 ONCA 218

[Gillese, Benotto and Roberts JJ.A.]


S. R. Jackson, for the appellants
R. O'Neill, for the respondents

Keywords: Appeals, Costs, Partial Indemnity, Substantial Indemnity


The Court of Appeal allowed a prior appeal affirming the validity of the easement granted in the 1979 Agreement that is registered against the parties' respective properties. However, in all other regards, the appellants were successful. Costs of the appeal were ordered in favour of the appellants in the amount of $3,000, all inclusive.

In the written decision by the Court, the court indicated that if the parties were unable to resolve the matter of costs of the Application and Counter-Application below (the "Proceedings Below"), they could make written submissions on that matter. The parties have been unable to resolve that matter and the court has now received and reviewed their costs submissions in relation to it.

The appellants seek costs of the Proceedings Below on a substantial indemnity basis in the amount of $14,440. They say that, bearing in mind the result on appeal, they were substantially successful in the Proceedings Below because their position on the scope of the easement and the rights that flow therefrom was upheld. The appellants then point to the general principle this court follows when an appeal is allowed: the order for costs below is set aside and costs are awarded to the successful party: Hunt v. TD Securities Inc. (2003), 43 C.P.C. (5th) 211 (Ont. C.A.)

The appellants acknowledge that the costs of the Proceedings Below would normally be on a partial indemnity basis which, in this case, would be just over $12,000. However, they ask this court to express its disapproval of the respondents' actions by making the costs award on a substantial indemnity basis. In support of this argument, the appellants have attached to their costs submissions copies of correspondence between counsel since the Decision was released. They say that this correspondence shows that there never was a leak in the pipeline so the respondents never had an immediate need to repair it and, in turn, that means that the Proceedings Below were unnecessary.

The respondents submit that the parties should bear their own costs of the Proceedings Below. They dispute the suggestion that there was no leak in the pipeline. They say that success below was divided, noting that their contention that a valid easement had been created and continued to exist was upheld on appeal. Consequently, their right to draw water from Sturgeon Lake by means of the pipeline that runs below the appellants' land was affirmed.

The respondents acknowledge that the appeal resulted in them losing on the issue of the scope of the easement, including their right to enter on the appellants' land to effect repairs without the appellants' prior permission and to lay a new pipeline. They also acknowledge that when an appeal is allowed, the general principle is that the order for costs below is set aside and costs are awarded to the successful party on a partial indemnity basis. However, they point to the court's discretion to depart from this approach "in unusual circumstances": Kopij v. Metropolitan Toronto (Municipality) (1999), 85 A.C.W.S. (3d) 763 (Ont. C.A.), at para. 2. They say that the facts of this case are unusual circumstances warranting a departure from the usual approach.


1. Does this matter amount to "unusual circumstances" such that the court should exercise its discretion and depart from its usual approach when deciding on costs of the Proceedings Below?

2. Should the court depart from the general principle that costs are to be awarded on a partial indemnity basis?

Holding: Costs of the Proceedings Below in favour of the appellants fixed at $8,000, all inclusive.


1. No. This matter did not amount to "unusual circumstances" such that the court should exercise its discretion and depart from its usual approach when deciding on costs of the Proceedings Below. This was a civil dispute which required the court to rule on legal questions so that the parties could clearly know what their respective rights and obligations were and, with that clarity, govern themselves accordingly.

However, it is important to note that the appeal in this matter was allowed only in part. Accordingly, while the order for costs below must be set aside, it does not automatically follow that the appellants are entitled to their full costs of the Proceedings Below. The quantum of costs must reflect the fact that there was divided success in those proceedings. The appellants enjoyed greater success. While the respondents succeeded on the question of whether a valid easement had been created and continued to attach to each of the parties' lands, the appellants succeeded on the issues that drove the Proceedings Below – namely, whether the respondents could enter onto the appellants' lands without their prior permission to repair the pipeline and whether the respondents had the right to replace the existing pipeline.

2. No. As for the scale of costs, the court should not depart from the general principle that costs are to be awarded on a partial indemnity basis. The finding of reprehensible behaviour warranting the sanction of costs on a substantial indemnity basis is not to be made lightly. The suggestion made about the respondents' conduct is based on correspondence that arose after the conclusion of these proceedings and which has not been tested in the crucible of litigation. The meaning to be taken from that correspondence is disputed. To resolve that dispute would require the court to make credibility findings. Those types of findings cannot be made on the basis of the record before the court.

Civil Endorsements:

Construction Distribution & Supply Co. Inc. v. King Packaged Materials Company, 2017 ONCA 200

[Hoy A.C.J.O., Gillese and Brown JJ.A.]
A. B. Dryer, for the appellant
T. Frankel, for the respondent
Keywords: Endorsement, Settlement

HJLJ Investments Limited v. 2305106 Ontario Inc., 2017 ONCA 213

[Hoy A.C.J.O, Gillese and Brown JJ.A.]
D. A. Brooker, for the appellant
S. Schwartz, for the respondent
Keywords: Endorsement, Appeal Dismissed


Criminal Decisions:

R. v. Brown, 2017 ONCA 211

[Feldman, Rouleau and Roberts JJ.A.]
M. Chernovsky, for the appellant
B. Cohen, for the respondent
Keywords: Endorsement, Criminal Law, Sentencing, Credit for Pre-Trial Custody

R. v. Lira, 2017 ONCA 214

[Rouleau, Pepall, Roberts JJ.A.]
Ivan David Lira, acting in person
A. Ohler, appearing as duty cousel
M. Asma, for the respondent
Keywords: Endorsement, Criminal Law, Jury Trial

R. v. Moore, 2017 ONCA 217

[Rouleau, Pepall and Roberts JJ.A.]
M. Moore, by videoconference
A. Ohler, duty counsel
M. Fawcett, for the respondent
Keywords: Endorsement, Criminal Law, Robbery, Sentencing, Vetrovec Witness

R. v. Lewis, 2017 ONCA 216

[MacFarland, Pardu and Trotter JJ.A.]
J. Lockyer and L. C. Beechener, for the appellant
M. Bernstein, for the respondent
Keywords: Criminal Law, Second Degree Murder, Juries, Bullying of Juror, Secrecy of Jury Deliberations

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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John Polyzogopoulos
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