Canada: Top 5 Civil Appeals from the Court of Appeal (December 2017)

Last Updated: December 19 2017
Article by Mark J. Freiman

1. Levac v. James, 2017 ONCA 842 (Blair, Juriansz and Miller JJ.A.), November 3, 2017

After performing an audit of a pain management clinic's infection prevention and control practices (IPAC), Toronto Public Health investigators identified patients who had developed infections after receiving injections administered at the clinic.

One of the patients commenced an action and brought a motion seeking certification as a class action as well as partial summary judgment against a physician at the clinic. The two motions were argued one after the other on the same day and the motion judge issued one set of reasons and one order regarding both. He granted partial summary judgment and certified the class proceeding. In his analysis of certification, the motion judge discarded the formulation of the breach of care common issue that he had certified at the certification hearing, instead certifying a fourth formulation of his own devising.

The physician appealed, arguing that the motion judge compromised procedural fairness.

The Court of Appeal agreed, and allowed the appeal.

Writing for the court, Miller J.A. noted that a certification judge may, in some circumstances, depart from the wording of a common issue that the parties have agreed upon and proposed, but emphasized that the requirements of procedural fairness impose limits on when and how that discretion may be exercised.

Miller J.A. went on to note that the motion judge did not view his change to the wording of the formulation of the breach of care common issue as merely a "distinction without a difference". He clearly understood the new wording as capturing "permutations of the duty of care issue" absent from the three formulations previously advanced, better portraying the distinction between negligent performance and negligent design of the IPAC practice. Regardless of whether the new wording actually did so, Miller J.A. held that the parties were denied the opportunity to address that question through submissions to the motion judge. Miller J.A. also noted that the physician may well have contested certification of the class proceeding had he known the certified common issue would be the one formulated by the motion judge. He was deprived of the opportunity to contest not only the final formulation of the common issue, but certification of a proceeding premised on that issue.

Miller J.A. rejected the respondent's submission that any unfairness from a lack of notice of the common issues was cured by the appeal process. The opportunity to argue an appeal with knowledge of the certified common issue did not cure the unfairness of arguing a summary judgment motion under a misapprehension about the common issue in question, and the ability to contest the certified common issue on appeal did not provide an adequate remedy for the lack of opportunity to convince the motion judge against certifying that issue at first instance. Miller J.A. held that it is crucial that litigants receive a fair process when they initially argue a certification motion, particularly since a certification judge's substantive conclusions are not easily set aside on appeal.

The matter was sent back for a new certification motion.

2. Holmes v. Hatch Ltd., 2017 ONCA 880 (Cronk, Huscroft and Nordheimer JJ.A.), November 20, 2017

The appellant employer, Hatch Ltd., appealed from summary judgment awarding the respondent employee, Paul Holmes, 18 months' reasonable notice at common law for the termination of his employment, subject to his mitigation obligations and applicable statutory deductions.

The motion judge's conclusion turned on her finding that Hatch breached the termination clause contained in the parties' employment agreement. Specifically, the motion judge found that Hatch failed to consider Holmes' years of service, position, and age when fashioning his termination package, contrary to the express language of the termination clause. This failure was a fundamental breach of contract that, at law, constituted a repudiation by Hatch of the entire employment agreement. As a result, the motion judge concluded, Holmes was entitled to common law damages based on reasonable notice of termination.

In a succinct decision, the Court of Appeal held that the summary judgment must be set aside and the matter remitted back to the Superior Court of Justice for a new hearing.

The motion judge's conclusion was based on her finding that Hatch breached the employment agreement. The court pointed out, however, that Holmes did not plead this, nor did he allege in his pleading that Hatch repudiated the agreement on that basis. Moreover, he did not advance these claims in his materials or on the motion. It was only when the motion judge raised the notion of this type of breach during oral argument that the parties made oral and subsequent written submissions on this issue. Hatch was therefore denied the opportunity to lead evidence on the precise allegation on which the motion judge's decision ultimately turned.

As the court emphasized in Rodaro v. Royal Bank (2002), 59 O.R. (3d) 74 (C.A.), it is fundamental to the litigation process that lawsuits be decided within the boundaries of the pleadings. The law assumes that the parties' pleadings properly delineate all relevant claims in dispute and define the issues. A finding of liability and resulting damages against a defendant on a basis that was not pleaded cannot stand, as the defendant was deprived of the opportunity to address that issue in the evidence at trial.

In this case, while the motion judge did attempt to ensure fairness to the parties by inviting submissions on the issue, she ultimately decided the summary judgment motion on the basis of a legal theory of liability that was neither pleaded nor advanced by Holmes in support of his motion. Prior to oral argument of the motion, Hatch was unaware of the evidentiary burden that it had to meet, and was denied the opportunity to lead evidence responsive to the allegation belatedly raised against it.

In the court's view, this fatally compromised the fairness of the hearing.

The court also noted that because the motion judge concluded that Hatch had fundamentally breached and repudiated the employment agreement, thereby rendering it invalid, she did not address or rule on Holmes' arguments concerning the enforceability of the employment agreement. Among other things, Holmes had argued that the termination provision did not reflect a clear agreement to contract out of the common law or, in the alternative, that it was ambiguous on this issue, that the termination clause violated the provisions of the Employment Standards Act, 2000, S.O. 1990, c. 41, and that it was not supported by any valid consideration. These issues remained to be determined.

The appeal was allowed.

3. Colucci v. Colucci, 2017 ONCA 892 (Sharpe, Blair and Epstein JJ.A.), November 22, 2017

Does the Superior Court have jurisdiction under the Divorce Act, R.S.C., 1985, c. 3 (2nd Supp.) to vary or discharge child support arrears where an application is brought after the children are no longer "children of the marriage"? In this decision, the Court of Appeal considered this question.

The Coluccis were married in 1983 and divorced in 1996. They had two children, born in 1988 and 1989. The appellant was ordered to pay child support to the respondent at the time of the divorce in the amount of $115 per week for each child. He made more or less regular payments until April 1998. Thereafter, payments were irregular and they eventually ceased in June 1999. Since the divorce, the appellant had worked as an unskilled labourer in Canada, the United States and Italy. His income tax returns and other financial disclosure reported a declining income since 1997.

By the time both children were over 18 years of age and no longer "children of the marriage", the appellant had accrued more than $175,000 in support arrears.

The appellant brought a motion to change the child support order retroactively and to have his arrears rescinded on the ground that there had been a change in circumstances. The respondent brought a cross-motion to dismiss the application for want of jurisdiction. The appellant brought a motion for summary judgment, asking the court to determine the issue of whether it had jurisdiction to retroactively vary child support by discharging child support arrears which had accumulated pursuant to a court order, notwithstanding that the children were no longer entitled to support because they were no longer "children of the marriage" as defined by the Divorce Act as of the date of the motion to vary.

The motion judge dismissed the appellant's motion and granted summary judgment dismissing the application to vary, relying on the Supreme Court's decision in D.B.S. v. S.R.G.; L.J.W. v. T.A.R.; Henry v. Henry; Hiemstra v. Hiemstra, 2006 SCC 37. D.B.S. – which dealt with four applications to vary child support orders, two under Alberta legislation and two under the Divorce Act – held that a court does not have jurisdiction to entertain an original application for child support under s. 15.1(1) of the Divorce Act if the children are no longer "children of the marriage". The motion judge concluded that D.B.S. similarly deprives the court of jurisdiction to rescind or vary an existing order for child support under s. 17(1) of the statute.

The Court of Appeal disagreed.

Although Henry v. Henry (one of the four cases decided with D.B.S.) involved an application for retroactive variation of a child support order, the Supreme Court did not directly consider the issue of whether the court has jurisdiction to entertain an application to vary a child support order after the children are no longer "children of the marriage". To answer this question, Sharpe J.A. turned to a line of jurisprudence which, in his view, supported the principle that the test for jurisdiction to vary differs from the test for jurisdiction to make an original order.

In Buckingham v. Buckingham, 2013 ABQB 155, the Alberta Court of Queen's Bench concluded that both the wording of the Divorce Act and the principles of child support favoured distinguishing D.B.S. and interpreting s. 17(1) to allow a court to vary a child support order even though the children are no longer children of the marriage. Sharpe J.A. noted that the reasoning in Buckingham has been followed in a number of Ontario trial level decisions under the Divorce Act, including Timmers v. Timmers, 2016 ONSC 306 and Charron v. Dumais, 2016 ONSC 7491, and that Ontario cases decided under the Family Law Act, R.S.O. 1990, c. F.3 have held that the court has jurisdiction to vary child support orders retroactively after the children cease to be dependants (frequently citing Buckingham in support). In Smith v. McQuinn, 2016 ONSC 7997, the court held that the case law has created exceptions to the D.B.S. analysis in a number of circumstances, including in variation proceedings where there is an existing order and an established support obligation under the Divorce Act. Sharpe J.A. identified other Ontario cases which have avoided applying D.B.S. by framing the motion as a matter of enforcement rather than variation, or by approaching it as a variation even where there is no existing court order.

As the Alberta court observed in Buckingham, the interpretation of s. 15.1(1) in D.B.S. turned on the precise wording of that provision, which confers jurisdiction to make a child support order for any who were, "at the material time", "children of the marriage". The jurisdiction to vary a child support order under s. 17(1), however, is at large and is not limited by those words. Sharpe J.A. agreed that given the significant difference between the language of the two provisions, the court was not bound to import the interpretation accorded to s. 15.1(1) by the Supreme Court in D.B.S. when interpreting s. 17(1).

Sharpe J.A. also agreed with the Alberta court that allowing a court to vary an existing order after the children cease to be "children of the marriage" is consistent with the principles of child support. The amount of child support depends upon the income of the parents: as the parents' income changes, so too does the obligation to pay support. Most important, child support orders should foster certainty, predictability, and finality, balanced against flexibility and fairness. As the Supreme Court explained in D.B.S., child support orders are not set in stone: orders may be varied when underlying circumstances change.

Sharpe J.A. held that the very existence of s. 17(1) demonstrates that finality has its limits and that neither children nor parents can safely assume that support orders will never change. The interest of certainty and finality does not justify erecting a rigid jurisdictional bar on variation applications simply because the children are no longer "children of the marriage".

The Court of Appeal granted summary judgment declaring that the court had jurisdiction to entertain the application, and remitted the matter back to the Superior Court for a determination on the merits.

4. E.T. v. Hamilton-Wentworth District School Board, 2017 ONCA 893 (Sharpe, Lauwers and Miller JJ.A.), November 22, 2017

The appellant, E.T., was the father of two primary school-aged children who attended a school within the jurisdiction of the respondent, Hamilton-Wentworth District School Board. A member of the Greek Orthodox Church, E.T. advised the Board that his religious beliefs required him to shelter his children from "false teachings". He provided the Board with a list of topics that included matters such as "moral relativism", "environmental worship", "instruction in sex education", and "discussion or portrayals of homosexual/bisexual conduct and relationships and/or transgenderism as natural, healthy or acceptable", and asked the Board to provide him with advance notice of any classroom instruction or discussion of these issues so that he could decide whether or not to withdraw his children from those classes.

The Board offered to exempt the appellant's children from the "Healthy Living" portion of the elementary program, a discrete part of the curriculum involving education on human development and sexual health. The Board explained to the appellant, however, that given the integrated nature of its program and the generality of the items on his list, it was neither practical nor possible to comply with his request for prior notification of any time one of the items on his list would arise for discussion in the classroom. The Board also expressed concern that if E.T.'s children were required to leave class every time one of the impugned topics came up for discussion, its policy of providing an inclusive and non-discriminatory program would be undermined.

E.T. brought an application seeking declaratory relief, asserting that his parental authority over the education of his children had been denied and that his freedom of religion as guaranteed under s. 2(a) of the Charter of Rights and Freedoms was violated by the Board's failure to provide him with the accommodation he requested. He also asserted a claim of religious discrimination under the Human Rights Code, R.S.O. 1990, c. H.19, and a violation of the Education Act, R.S.O. 1990, c. E.2.

The application judge held that while the Board's refusal to provide the requested accommodation engaged the appellant's religious freedom, its decision was reasonable.

The Court of Appeal dismissed E.T.'s appeal on the ground that he failed to establish any interference with or violation of his religious freedom.

Sharpe J.A. observed that the appellant's claim rested on a "general and pervasive dissatisfaction" with the nature of the Board's curriculum with respect to matters of equity, non-discrimination, and inclusiveness. He noted that E.T. did not provide concrete evidence of any interference with his right to religious freedom, a "central and fatal shortcoming" in his case. Indeed, E.T. did not prove a single instance where his children were coerced to do something that was contrary to his or their religious beliefs or where they were denied the right to manifest or observe their religion as they wished. Nor did the appellant provide any evidence that his right to inculcate his children with his own religious views was curtailed or infringed.

While he accepted E.T.'s "sincere religious belief" that he has an obligation to shelter his children from what he described as "false teachings", Sharpe J.A. held that the Supreme Court has made it clear that exposing students who are attending non-denominational public schools to ideas that may challenge or even contradict their parent's sincerely-held religious beliefs does not amount to an infringement of religious freedom. A sincere religious belief alone was insufficient to establish interference with E.T.'s freedom of religion: his subjective belief that he must shield his children from "false teachings" did not gain absolute protection. Rather, the onus remained on E.T. to provide evidence that, from an objective standpoint, the instruction and activities to which his children were exposed interfered with his ability to protect them from "false teachings". In Sharpe J.A.'s view, the appellant failed to satisfy that onus.

Thus, while he agreed with the result reached by the application judge, Sharpe J.A. disagreed with his conclusion that E.T. established an infringement of his s. 2(a) Charter right to freedom of religion.

Sharpe J.A. further held that E.T. could not, by virtue of his religious beliefs, insist that a non-denominational public school board restructure its inclusive and integrated program, designed to meet its statutory objective of ensuring a respectful and accepting climate for all children, in order to ensure that his own children were not exposed to any views that he did not accept.

Lauwers and Miller JJ.A. concurred with the result reached by Sharpe J.A. and also dismissed the appeal for lack of evidence, but with different reasoning. For Lauwers J.A., who authored the concurring opinion, the central issue for the court was the limit imposed by the Charter on a province's power to use publicly funded education to inculcate, in the language of s. 264 of the Education Act, certain beliefs and dispositions that educational authorities have determined to be desirable or necessary.

Lauwers J.A. observed that the appeal was governed by the framework established by the Supreme Court in Doré v. Barreau du Québec, 2012 SCC 12, and Loyola High School v. Québec, 2015 SCC 12. The first step is to determine "whether the decision engages the Charter by limiting its protections". If so, the second step is to determine "whether, in assessing the impact of the relevant Charter protection and given the nature of the decision and the statutory and factual contexts, the decision reflects a proportionate balancing of the Charter protections at play". In Lauwers J.A.'s view, E.T.'s claim met the first half of the first step of this test: his religious freedom was implicated. However, Lauwers J.A. was unable to find that the appellant had proven substantial interference with his freedom of religion, as the balance of the first step of the Doré/Loyola framework would require.

The appeal was dismissed.

5. York (Municipality) v. Irwin, 2017 ONCA 906 (Sharpe, Epstein and van Rensburg JJ.A.), November 24, 2017

The appellant, Robert Irwin, was charged with various offences under Part III of the Provincial Offences Act, R.S.O. 1990, c. P.33 (POA). Specifically, he was alleged to have violated the Building Code Act, 1992, S.O. 1992, c. 23 (BCA) by not complying with six orders to comply that the respondent, the Regional Municipality of York, issued in 2013. The municipality alleged that various additions and alterations to Irwin's property were made without a building permit.

Irwin testified at a trial before a Justice of the Peace that the 2013 orders were identical to orders to comply that had been issued against him in 1995 and 1996, which had led to charges that were withdrawn. Irwin sought an order requiring the respondent to provide disclosure of prior charges and prosecutions against him. The Justice of the Peace made the disclosure order after hearing argument.

The respondent applied to the Superior Court for an order for certiorari under s. 140 of the POA. The application judge granted an order quashing the disclosure order and requiring the Justice of the Peace to continue with the trial of the charges.

The application judge held that although the earlier orders may well have applied to the same buildings on the property and required the same actions, they had different compliance deadlines and therefore constituted distinct offences. In his view, the respondent was entitled to issue more than one order to comply, and each failure to comply would be a distinct offence. The application judge also accepted that while Irwin might have relied on the withdrawal of the earlier charges had he appealed the six orders, he could not now attack the validity of the order having failed to avail himself of the appeal mechanisms under the BCA.

Irwin appealed under s. 140(3) of the POA. He argued that the application judge erred in granting certiorari during the trial and that any issue as to the relevance of the earlier orders ought to have awaited an appeal post-trial. He submitted that the application judge ought not to have granted the order without finding that a substantial wrong or miscarriage of justice had occurred, as required by s. 141(4) of the POA, and that the test was not met in this case.

The Court of Appeal agreed.

The court emphasized that applications for certiorari should be granted only rarely. The test for intervention mid-trial by certiorari under s. 140 of the POA is whether an erroneous ruling made during the trial renders the proceeding "so unfair that the interests of justice require the court to intervene and grant prerogative relief". The court held that the application judge erred by failing to consider the substantial wrong or miscarriage of justice test in s. 141(4) of the POA, and in determining on the merits and mid-trial the issue of whether the earlier orders were relevant to the appellant's defence.

The court held that the justice of the peace was entitled to determine questions of the relevance of evidence and to make disclosure orders, without such decisions being challenged mid-trial. Even if the disclosure order was wrong, complying with it would not amount to a substantial wrong or miscarriage of justice. The disclosure order would not preclude the respondent from arguing that the materials disclosed were not in fact relevant and did not afford a defence. The effect of the application judge's order, however, was that any defence based on earlier compliance was effectively taken off the table. The issue of whether Irwin's argument amounted to a collateral attack on the order to comply should have been resolved at trial on a proper record.

The order of certiorari was set aside.

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