Canada: Ontario Court Of Appeal Summaries (October 8 – 12, 2018)

Blaney's Appeals
Last Updated: October 16 2018
Article by John Polyzogopoulos

Good evening.

Following are the summaries for this week's civil decisions of the Court of Appeal for Ontario.

In Shah v LG Chem Ltd, the Court of Appeal certified a class action for claims of conspiracy at common law and conspiracy to price fix under the Competition Act, in relation to lithium-ion batteries. The Court determined that the concept of "indeterminate liability" in negligence law should not be imported into the analysis of common conspiracy or Competition Act claims.

In Beaver v Hill, the Court of Appeal, while not disposing of the issue, determined that some Aboriginal and treaty rights may be capable of being asserted by an individual, rather than an Aboriginal community. In this case, the appellant argued that spousal and child support should be decided under his First Nation's law, not under Ontario's family law statutes. The issue was remanded to the Superior Court of Justice to be determined on a proper evidentiary record.

Other topics covered this week included a priority dispute between insurers under the Insurance Act in the MVA context, and the ability to claim HST from a customer well after the supply of the good in question.

Have a great weekend.

John Polyzogopoulos

Blaney McMurtry LLP

416.593.2953 Email

CIVIL DECISIONS

Shah v LG Chem Ltd, 2018 ONCA 819

[Rouleau, Roberts and Fairburn JJ.A.]

Counsel:

R. Mogerman, J-M. Leclerc and B. Moran, for the appellants

J.F. Rook, Q.C., C.A. Jordaan and E. Davis, for the respondents Panasonic Corporation, Panasonic Corporation of North America, Panasonic Canada Inc., Sanyo Electric Co., Ltd., Sanyo North America Corporation and Sanyo Energy (U.S.A.) Corporation

J.K. Wright and T. Shikaze, for the respondents Hitachi Maxell, Ltd. and Maxell Corporation of America

L.F. Cooper and V. Toppings, for the respondents Toshiba Corporation, Toshiba America Electronic Components, Inc. and Toshiba of Canada Limited

M. Littlejohn, for the respondents LG Chem. Ltd. and LG Chem America, Inc.

Keywords: Torts, Unlawful Means Conspiracy, Statutory Claims, Price Fixing, Civil Procedure, Class Actions, Certification, Common Issues, Representative Plaintiff, Pleadings, Reasonable Cause of Action, Class Proceedings Act, 1992, SO 1992, c 6, s 5, Competition Act, RSC, 1985, c C-34, ss 36 and 45

Facts:

This appeal arose out of the sale of lithium-ion batteries by the respondents from 2000 until the end of 2011. The appellants alleged that the respondents and unnamed co-conspirators conspired to raise their prices and/or reduce competition in the production, manufacture, sale and/or supply of such batteries.

The appellants maintained that because the alleged cartel held so much market share (over 75% of the Canadian market), the increase in prices caused non-conspirators to also raise their prices. This is referred to as an "umbrella" effect, and the purchasers of the non-conspirators' products were "umbrella purchasers".

The Court of Appeal noted that the issue of liability to umbrella purchasers remained a contested issue in Canada, as the procedural history of this appeal was directly parallel to an umbrella purchaser case in British Columbia. In the course of these two cases, each British Columbia and Ontario court respectively rejected each other's reasoning through various stages of appeal. The British Columbia case, Godfrey v. Sony Corporation, 2017 BCCA 302 was granted leave to appeal to the Supreme Court, with the appeal yet to be heard.

The appellants sought to have multiple causes of action certified under the Class Proceedings Act, including unlawful means conspiracy and an analogous statutory cause of action under s. 36 of the Competition Act for breach of s. 45 of that Act (the "statutory claim"). The certification judge refused to certify the unlawful means conspiracy claim but certified the statutory claim, although only in relation to the non-umbrella purchasers. The certification judge provided several reasons for excluding the umbrella purchasers, including that the respondents would be exposed to indeterminate liability.

The appellants sought leave to appeal the certification judge's decision to the Divisional Court, and were granted leave on (a) whether the certification judge erred in denying certification of the unlawful means conspiracy claim and (b) whether the certification judge erred in removing the umbrella purchasers from the class. The Divisional Court found error on the first point, resulting in the certification of the unlawful means conspiracy claim, but no error on the second point, agreeing with the certification judge's concern over indeterminate liability.

The Divisional Court also expressed the view that the appellants had failed to: (a) plead the requisite elements of the claims relating to the umbrella purchasers; (b) establish common issues for the umbrella purchasers; and (c) propose a separate representative plaintiff for the umbrella purchasers. The appellants then sought and were granted leave to appeal to the Court of Appeal.

Issues:

(1) Did the Divisional Court err in finding that the umbrella purchaser claims did not disclose a cause of action because:

(a) the respondents would be exposed to indeterminate liability, and

(b) the requisite elements of the claim were not properly pleaded?

(2) Did the Divisional court err in finding that the umbrella purchaser claims did not raise common issues within the meaning of s. 5(1)(c) of the Class Proceedings Act?

(3) Did the Divisional Court err in finding that a separate representative plaintiff would be required under s. 5(1)(e) of the Class Proceedings Act?

Holding:

Appeal allowed.

Reasoning:

(1) Yes.

(a) Turning to the first to the statutory claim, the Court of Appeal noted that a plain reading of the s. 45 of the Competition Act suggested that the statutory cause of action did not admit any consideration for indeterminate liability. The cause of action required only proof of the respondents conspiring and proof that it caused the appellants' injuries. The Court of Appeal additionally observed that this reading was consistent with the purpose of the Competition Act to foster vigorous and fair competition.

The Court of Appeal then turned to an analysis of the legal norms that inform the application of negligence principles to statutory causes of action, rejecting the respondents' contention that indeterminate liability should apply in this case because courts have recognized the applicability of remoteness in similar circumstances. The Court expressly avoided answering the question of whether negligence principles might apply outside the negligence context or whether indeterminate liability might apply to claims that require proof of intention, restricting its reasons specifically to the applicability of indeterminate liability in respect of claims under s. 36 of the Competition Act for conspiratorial conduct under s. 45.

The Court found that the normative concerns underlying indeterminate liability do not apply in the context of a statutory claim because they have already been addressed by Parliament. In other words, concerns that might otherwise drive the application of indeterminate liability disappear in the face of the exacting statutory provisions. The Court similarly rejected the respondents' contention that indeterminate liability remains a concern because the cause of action does not require that the impugned conduct be specifically directed at harming a plaintiff. Section 45 contains significant internal constraints, insofar as it limits the reach of liability to those who, at a minimum, specifically intend to agree upon anti-competitive conduct.

Turning second to the common law claim for unlawful means conspiracy, the Court noted that unlawful means conspiracy contains even stronger limitations than those contained in the Competition Act since it requires that the impugned conduct be directed at the plaintiffs. Thus, there is no concern surrounding indeterminate liability in relation to the common law tort.

Lastly, the Court concluded that even if indeterminate liability were relevant to the two claims, the umbrella purchasers' claims still would not fail on that basis. Because of the limitations built into both the statutory claim and the common law claim, there exists only the possibility for significant liability. The Court also rejected the respondents' contention that they had no control over the non-conspirators' actions and therefore should not be subject to liability for the umbrella purchasers' losses, since the respondent in fact controlled the vast majority of the market.

(b) Turning next to the sufficiency of the pleadings, the Court of Appeal addressed the issue of whether the appellants' statement of claim was deficient for its apparent reliance on the proposition that a causal link could be presumed between the alleged conspiracy and the losses suffered by the umbrella purchasers. The Court found that although the statement of claim was somewhat lacking in particulars, it was nonetheless worded broadly enough to encompass harm to umbrella purchasers and was therefore sufficiently pleaded.

(2) Yes. While the Divisional Court was in some sense justifiably concerned that no common issues had been proposed respecting the claims advanced by the umbrella purchasers, this concern was nevertheless misguided insofar as the common issues of the umbrella purchasers were essentially the same as that of the non-umbrella purchasers.

The Court of Appeal then addressed the respondents' contention that the appellants failed to advance a plausible methodology by which harm to the umbrella purchasers could be proven, and quantified, on a basis that was common to the rest of the class. While the expert evidence on this point did not specifically identify umbrella purchasers and was somewhat short on detail with respect to the threshold question of establishing harm, it nevertheless was sufficient to establish a reasonable prospect of establishing loss on a class-wide basis.

Although the appellants' expert noted that his own conclusions left room for debate over whether non-conspirators would need to raise prices as a result of the alleged conspiracy, his report nevertheless allowed for inferences as to the causal link between the non-conspirators' pricing and the umbrella purchasers' injury. Additionally, the data on which the appellants' expert relied was readily available either publically or via the discovery process. The Court concluded that while the appellants' expert evidence conflicted with the respondents' expert evidence and might ultimately be disproved, that issue was one to be determined at trial.

However, the Court noted that quantification of aggregate damages could not be certified as a common issue as between umbrella and non-umbrella purchasers, finding instead that the umbrella purchasers would have to form a subclass for this issue. The statement of claim and the appellants' expert report treated aggregate damages in such a way as to limit quantification to the losses suffered by non-umbrella purchasers, meaning that there was no way of establishing a reasonable likelihood of proving damages for the umbrella purchasers. The Court stressed that this did not mean that the action as a whole should not proceed as a class proceeding.

(3) Yes. The Court noted that the umbrella and non-umbrella purchasers had the same interest from the outset: to demonstrate the existence of the conspiracy and the general increase in prices. The conclusion that a subclass would be required for umbrella purchasers in respect of the quantification of damages did not put them in conflict with the non-umbrella purchasers. If a problem were to arise at a later stage, separate representation could be easily established.

Finally, the Court also confirmed that a class proceeding would be the preferable procedure for resolving issues related to the umbrella purchasers. In the context of the action as a whole, the resolution of the common issues relating to the alleged wrongdoing, and the impact of that wrongdoing on the class members, would significantly advance the action. The fact that even a substantial number of individual issues would remain to be determined after the common issues trial could not preclude certification in these circumstances. Thus, proceeding as a class action would achieve judicial economy.

Beaver v Hill, 2018 ONCA 816

[Lauwers, van Rensburg and Nordheimer JJ.A.]

Counsel:

C.G. Paliare, B.R.G. Smith, and A.K. Lokan, for the appellant

H. Niman, M. McCarthy, S. Strathopolous, J. Radbord, and S. Byers, for the respondent

M. Fancy and E.L. Garfin, for the Attorney General of Ontario, intervenor

Keywords: Family Law, Aboriginal Law, Constitutional Law, Aboriginal Self-Governance, Jurisdiction, Spousal Support, Child Support, Constitution Act, 1982, s. 35, Children's Law Reform Act, RSO 1990, c C.12, Family Law Act, RSO 1990, c F.3, Delgamuukw v British Columbia, [1997] 3 SCR 1010, R v Van der Peet, [1996] 2 SCR 507, Haida Nation v British Columbia (Minister of Forests), 2004 SCC 73, Lax Kw'alaams Indian Band v Canada (Attorney General), 2011 SCC 56, Behn v Moulton Contracting Ltd, 2013 SCC 26, R v Sparrow, [1990] 1 SCR 1075

Facts:

In 2015, the respondent brought an application for custody of B. under the Children's Law Reform Act (the "CLRA") and child and spousal support under the Family Law Act (the "FLA"). In 2016, the appellant filed an answer and defence in the usual form but shortly after filed a notice of constitutional question challenging the jurisdiction of the Superior Court, as well as the applicability of the CLRA and FLA, on the basis that he had an Aboriginal and treaty right, protected by s. 35 of the Constitution Act, 1982 ("s. 35"), to have his family law disputes resolved pursuant to Haudenosaunee law.

The appellant gave notice of his constitutional claim to the Chief of the Six Nations and to the Haudenosaunee Confederacy Council. Neither took steps to intervene or participate. The motion judge struck out the appellant's amended answer and dismissed the constitutional claim brought under s. 35 to have the parties' family law dispute decided through "Haudenosaunee governance processes and protocols and according to Haudenosaunee laws."

The motion judge granted the respondent's motion for interim spousal and child support. She held that the Superior Court had jurisdiction to hear the family law dispute and struck the appellant's amended answer without leave to amend and dismissed his claim under s. 35 of the Constitution Act, 1982. Under the motion judge's order, the respondent's application for custody, spousal and child support would proceed in the ordinary course under the CLRA and FLA and associated rules and practices, without regard to the appellant's constitutional claim.

Issues:

(1) Should conflict of laws concepts be applied to determine whether the Superior Court of Justice had jurisdiction over the appellant?

(2) Was it appropriate for the motion judge to strike the appellant's constitutional claim without leave to amend?

(3) Does the appellant have standing to assert the constitutional claim, and is it justiciable?

(4) Was the appellant entitled to a stay of the respondent's family law claims pending disposition of his constitutional claims?

(5) Was the appellant's appeal an abuse of process?

Holding:

Appeal allowed in part.

Reasoning:

The Court held that the appellant was permitted to seek leave before the Superior Court of Justice to amend his answer to address criticisms of his pleadings but the Court refused to dismiss the interim support order.

(1) No. It was an error of law for the motion judge to take into account general conflict of laws principles in her analysis of the jurisdiction issue raised by the appellant. These principles do not provide an apt framework for reconciling Aboriginal rights with the family law of Ontario. Ultimately, the appellant conceded on appeal that the Superior Court of Justice had plenary jurisdiction over the constitutional issue.

(2) No. It was an error in principle and inappropriate for the motion judge to strike the appellant's constitutional claim without leave to amend. The motion judge ought to have considered whether the appellant should be given the opportunity to further amend the answer in an effort to address the serious deficiencies she identified.

(3) Not decided. The motion judge's decision that the appellant did not have standing to assert his constitutional claim and that the claim was not justiciable could not be sustained on the record before the Court. This determination should usually, although not invariably, be made on the basis of evidence, consistent with Supreme Court of Canada jurisprudence.

Some Aboriginal and treaty rights might be capable of being asserted by an individual as opposed to an Aboriginal community. The appellant's claim could fall into the individual category, but this depends on the evidence. The Court agreed with the motion judge's criticisms of the appellant's pleading before her. The Court declined to comment on the adequacy of the draft amended pleading put before it since that is the role of the Superior Court of Justice.

The Court found that it was not clear at this early stage of the litigation whether the appellant lacked standing to make his constitutional claim, or that it was not justiciable. Neither the constitutional claim nor the standing issue were ripe for disposition. The motion judge's dismissal of the claim and her determination of the standing issue were set aside. It was left open to the respondent to move for summary judgment after the pleadings are improved and the evidence is adequately developed.

(4) No. The appellant was not entitled to a stay of the respondent's family law claims pending disposition of his constitutional claims. The Superior Court of Justice has clear jurisdiction to grant interim relief incidental to its plenary inherent jurisdiction to decide questions of law in private and constitutional matters while the s. 35 claim is being determined. The respondent and B. were entitled to enforceable support pending the determination of the constitutional claim.

(5) No. The appellant's appeal was not an abuse of process. Regardless of the primary objectives of family law proceedings-dealing with cases justly, maintaining fair procedure for both parties, saving expense and time, dealing with cases in ways that are appropriate to its importance and complexity, and managing judicial resources-the appellant had the right to advance his constitutional claim, as inconvenient to the respondent, time-consuming and expensive as that might be. However, this right does not relieve the judiciary or the parties from making every effort to adhere to the primary objective where possible.

Ontario (Finance) v Elite Insurance Company, 2018 ONCA 809

[van Rensburg, Pardu and Paciocco JJ.A.]

Counsel:

E.K. Grossman and M.A. Harper, for the appellant

M. Sydney, for the respondent

Keywords: Contracts, Insurance Law, Automobile Insurance, Statutory Accident Benefits, Priority Dispute, Termination, Non-Renewal, Arbitration, Standard of Review, Statutory Interpretation, s 236(5) of the Insurance Act, RSO 1990, c I.8, Echelon General Insurance Company v Ontario (Minister of Finance), 2016 ONSC 5019, Patterson v Gallant, [1994] 3 SCR 1080

Facts:

The appellant issued an automobile insurance policy (the "policy") to a claimant for a six-month term, which was then renewed for a second term. The policy required policy-holders to register online and receive a device that they would install in their car to record driving behaviour. The claimant never did so. The appellant repeatedly told the claimant that he must register for the device, finally indicating that it would cancel his policy if he did not. The appellant subsequently sent the claimant what purported to be a non-renewal notice (the "notice"), stating that it would be unable to continue providing insurance due to Rule 56 of the Declination Rules of its parent company. Rule 56 establishes failure to register online as a ground for non-renewal.

The claimant then obtained a policy from AXA for the same car. The claimant cancelled the AXA policy a short time thereafter, leaving him without insurance. Thirteen months after the expiration of the policy's second term, he was struck by an uninsured vehicle while trying to save a parking spot for a friend. The claimant applied for, and received, statutory accident benefits from the Motor Vehicle Accident Claims Fund (the "Fund"). The Fund gave notice of a priority dispute, asserting that the appellant was higher in priority because it had issued an earlier policy. The Fund claimed that the non-renewal was invalid because it did not comply with the Insurance Act and that, pursuant to s. 236(5) of that same Act, the policy remained in force.

The matter was referred to arbitration. The parties agreed that the preliminary issue to be resolved was whether the appellant's policy was in force at the time of accident. The arbitrator was required to determine the following: first, whether the notice was valid; and second, if it was invalid, whether the policy remained in force at the time of the accident.

On the first issue, the arbitrator concluded that the notice was invalid because it was premature; the rule required the notice to be sent after the second term had ended without the insured having registered to receive the device, meaning that the grounds for non-renewal therefore did not exist at the time of the notice.

On the second issue, the arbitrator considered s. 236(5) in the light of the parties' conduct and common law principles. He accepted that, in the absence of an effective non-renewal notice, s. 236(5) applied to automatically renew the policy, but he did reject the argument that the policy would renew indefinitely on each anniversary date of the policy term no matter what occurred after the initial automatic renewal. Referring to the Supreme Court's decision in Patterson v Gallant, he concluded that each renewal represents a new contract and that, in the absence of agreement between the parties, the policy would renew for at most one more term.

Reviewing contract law principles as they apply to insurance contracts, the arbitrator concluded that both parties clearly intended to terminate the relationship, and that in the alternative, the claimant had repudiated the contract when he failed to comply with its essential conditions, and when he secured replacement coverage. Accordingly, the latest date at which the policy could be construed to have ended was no later than six months after the end of the second term.

The Fund appealed the arbitrator's conclusion on the second issue, while the appellant cross-appealed the arbitrator's conclusion on the first. The appeal judge dismissed the appellant's cross-appeal, upholding the arbitrator's conclusion. He allowed the Fund's appeal, concluding that the policy remained in force at the date of the accident.

The appeal judge referred to Echelon General Insurance Company v Ontario (Minister of Finance) for the proposition that s. 236(5), which provides that a contract of insurance is in force until there is compliance with the Act, ousts the common law of contract under which an insurance policy might otherwise expire. He rejected the appellant's argument that giving the words of s. 236(5) a "literal interpretation" would alter the common law with respect to insurance policies by turning insurance contracts into continuous contracts. He instead found that the policy continues only until the insurance company discharges the statutory notice obligations.

The appeal judge concluded that the arbitrator's determination that there was an automatic renewal of the policy was unreasonable. He therefore declared that the policy was in force at the time of the accident, and that the appellant was the priority insurer.

Issues:

(1) Was it reasonable for the arbitrator to conclude that the notice was premature?

(2) Was it reasonable for the arbitrator to conclude that the policy was not in force, notwithstanding the invalid notice of non-renewal?

Holding:

Appeal allowed.

Reasoning:

(1) Yes. The Court of Appeal recognized that while there was some merit to the argument that Rule 56 admits of alternative interpretations, the question was not whether one interpretation is better than another. The arbitrator's interpretation was consistent with Rule 56's plain wording, and to the extent there was any ambiguity, it favoured coverage to the claimant. The Court of Appeal therefore concluded that there was no basis to interfere.

(2) Yes. A majority of the Court of Appeal found that although it disagreed with certain aspects of the arbitrator's analysis, the decision as a whole arrived at a reasonable result.

The majority first identified two points on which it agreed that the arbitrator's analysis was unreasonable. First, the arbitrator erred in concluding that the effect of s. 236(5) was to renew the policy for at most one further term, since that section simply provides for continuation of the policy until a compliant notice is given. Second, it was unreasonable for the arbitrator to rely on Patterson as authority because there was no equivalent to s. 236 in the applicable insurance legislation in Patterson. There, the Court expressly recognized that "the provisions of the Insurance Act can override the common law of contract". Thus, the only reasonable interpretation of s. 236(5) was that it overrides the common law with respect to lapsed policies.

Although the majority agreed with the appeal judge on these issues, it disagreed that these errors made the arbitrator's decision unreasonable as a whole. It was not unreasonable to conclude that s. 236(5) is not exhaustive as to what happens in instances of defective non-renewal. Noting that it was undisputed that an insurance policy may end other than by notice of non-renewal, the majority observed that termination may occur at the insured's initiative" at any time on request", and that there are no specific requirements for the request's content or form. Section 236 only deals with an insurer's non-renewal, prescribing the timing and content; it does not preclude the consideration of other circumstances that may end the policy, as was the case here.

Even if it was precipitated by the assumption that the notice was valid, the parties shared a mutual intention that the policy would terminate and acted in reliance on that termination. The appellant no longer charged a premium, and the claimant obtained replacement coverage. The appeal judge did not consider the parties' conduct in this respect, instead treating s. 236(5) as determinative for all purposes. Here, it was reasonable for the arbitrator to conclude that the policy was brought to an end by the parties' mutual agreement.

Finally, the majority of the Court of Appeal noted that its conclusion was consistent with the statutory regime, and consistent with the modern approach to statutory interpretation. A literal interpretation of s. 236(5) would lead to absurd results, insofar as it would keep a policy alive indefinitely even where an insured subsequently receives a valid notice or the insured chooses to terminate and replace the policy.

In dissent, Pardu J.A. found that the arbitrator's decision was unreasonable because it failed to give effect to the statutory language, failed to consider legislative purposes, and adopted an interpretation that has no logical connection to the statutory language. While not addressing the majority opinion directly, Pardu J.A. found that the appeal judge's interpretation was the only one consistent with the Insurance Act's legislative objectives. There was only one reasonable interpretation of s. 236(5), and that the arbitrator failed to make it. Lastly, Pardu J.A. found that the arbitrator's application of the notion of repudiation was flawed, as there was no communication between the claimant and the appellant that could be construed as a mutual agreement to terminate the policy. Pardu J.A. therefore would have dismissed the appeal.

National Money Mart Company v 24 Gold Group Inc, 2018 ONCA 812

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

Counsel:

J. Adair and S. Husband, for the appellants

M.J. Huberman, for the respondent

Keywords: Contracts, Sale of Goods, Taxation, HST, HST, Civil Procedure, Appeals, New Issue on Appeal, Issue of Law, Excise Tax Act, RSC 1985, c E-15, ss 223(1) and 224, 390781 Alberta Ltd v Mensaghi, 1992 GSTC 10, OCCO Developments Ltd v McCauler, [1996] GSTC 16, CRA Policy Statement P-116, Collection of GST, by a Supplier, Where the Invoice is Silent on the Tax Payable, Governor's Hill Developments Ltd v Robert, [1993] GSTC 35 (Ont Gen Div)

Facts:

Between 2010 and 2012, the appellants purchased approximately $12.16 million worth of unrefined gold from the respondent, pursuant to an oral agreement of purchase and sale. The appellants did not pay HST on the purchases and the respondent did not collect or remit HST on them, despite the sale of unrefined gold being consider a "taxable supply" within the meaning of the Excise Tax Act, RSC 1985, c E-15 ("ETA").

Based on these transactions, in 2015 the Canada Revenue Agency ("CRA") audited the respondent's HST returns and reassessed that it owed $1,573,903.94 in HST to the CRA. The CRA used part of the respondent's corporate tax payments to satisfy the amount owed.

After the CRA's reassessment, the respondent issued two invoices to the appellants requiring payment of the HST. The invoices stated that the HST was not charged in error. The respondent never received payment from the appellants.

The respondent then commenced this action against the appellants for reimbursement of HST and moved for summary judgment. Summary judgment was granted against the appellants for the full amount of HST. The appellants now appeal on the basis that the respondent was barred from commencing an action against them to begin with, because they did not comply with ss 223(1) and 224 of the ETA. The respondent contends that the appellants cannot raise this argument because they did not raise it before the motion judge.

Issues:

(1) Are the appellants raising a new issue in this appeal? If so, should the new issue be considered by this Court?

(2) Did the respondent fail to comply with ss 223(1) and 224 of the ETA, barring its ability to commence an action against the appellants?

Holding:

Appeal dismissed.

Reasoning:

(1) Yes.

The appellants are seeking to raise a new issue in this appeal that it has not raised in its statement of defence or its factum on the summary judgment motion. Nevertheless, the issue should still be considered by this Court for three reasons.

First, the new issue involves a pure interpretation of law, namely: the interpretation of ss 223(1) and 224 of the ETA. Further, the respondent was permitted to file a supplementary factum and book of authorities on the issue.

Second, the facts relevant to determining the new issue are not in dispute.

Third, considering the new issue will not cause non-compensable prejudice to the respondent. The respondent argues that it will be prejudiced because considering this new issue means withdrawing an admission that was made in an earlier factum, where the appellants admitted that the respondent complied with s 223 of the ETA. However, withdrawing this admission does not result in prejudice to the respondent because the admission was an admission of law, and admissions of law can be withdrawn.

(2) No.

Section 224 of the ETA specifies conditions that a supplier must meet in order to bring an action against a recipient to recover HST. One of those conditions is found in s 223(1), which requires that disclosure of the HST be given to the recipient at the time of the supply. The appellants argue that the respondent did not comply with this subsection and therefore, as per s 224, is barred from commencing an action against them.

The Court rejected the appellants' argument. There is clear and settled case law that interprets s 223(1) from the New Brunswick Court of Appeal in OCCO Developments Ltd v McCauler ("Occo Developments"). Occo Developments interprets s 223(1) as allowing a supplier to invoice for HST after the time of supply, subject to any contractual restrictions that may not permit them to do so. This interpretation was adopted by CRA policy in 1994, and similar views have been expressed through professional commentary. No such contractual restrictions existed as between the appellants and the respondent. Therefore, the respondent was entitled to ask for HST after the time of supply, and is not barred from bringing an action against the appellants under s 224.

Further, the Court rejected three more of the appellants' arguments. First, allowing invoices for HST after the transaction does not create a moral hazard permitting vendors to avoid complying with s 223(1), because if a contract is silent on whether HST is charged, the contract is usually interpreted as treating HST as extra. Second, allowing invoices for HST after the transaction does not deny natural justice to recipients because recipients are able to negotiate express terms to allocate responsibility for paying tax as between the parties. Finally, whether a post-transaction invoice for HST stifles the ability for recipients to claim input tax has no bearing on the interpretation of s 223(1).

SHORT CIVIL DECISIONS

Crawford v Crawford, 2018 ONCA 810

[Hourigan, Miller and Trotter JJ.A.]

Counsel:

P. Morris, for the appellant

E. MacLeod, for the respondent

Keywords: Family Law, Evidence, Settlement Privilege

CRIMINAL DECISIONS

R v Brown, 2018 ONCA 814

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

Counsel:

P. Scrutton, for the appellant

A. Forbes, for the respondent

Keywords: Criminal Law, Dangerous Driving, Mens Rea, R v Roy, 2012 SCC 26, R v Beatty, 2008 SCC 5

R v Cubillan, 2018 ONCA 811

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

Counsel:

M. Bojanowska, for the appellant

R. De Filippis, for the respondent

Keywords: Criminal Law, Sexual Assault, Ineffective Assistance of Counsel, R v Joanisse (1995) 102 CCC (3d) 35 (Ont CA), leave to appeal refused, [1996] SCCA No 437, R v Archer (2005), 202 CCC (3d) 60 (Ont CA), R v Dunbar, 2007 ONCA 840, Browne v Dunn (1893), 6 R 67 (HL)

R v SB1, 2018 ONCA 807

[Strathy C.J.O., Juriansz and Roberts JJ.A.]

Counsel:

P. Copeland, for the appellant T.F.

E. Chozik, for the appellant M.W.

C. Webb, L. Bolton and B. Jones, for the respondent

Keywords: Criminal Law, Murder, Evidence, Inferences, Post-Offence Conduct, Circumstantial Evidence, Burden of Proof, Ante-Mortem Hearsay Evidence, R v Morrissey (1995), 22 OR (3d) 514 (CA), R v Villaroman, 2016 SCC 33, R v Laboucan, 2012 SCC 12, R v REM, 2008 SCC 51, R v Lepage, [1995] 1 SCR 654, R v MacKinnon (1999), 132 CCC (3d) 545 (Ont CA), R v Fatima (2006), 42 CR (6th) 239 (Ont SC), R v Salah, 2015 ONCA 23, R v Adamson, 2018 ONCA 678, R v Vorobiov, 2018 ONCA 448, R v Angelis, 2013 ONCA 70, R v Chambers, 2016 ONCA 684, R v White, [1998] 2 SCR 72, R v Arcangioli, [1994] 1 SCR 129, R v White, 2011 SCC 13, R v Aravena, 2015 ONCA 250, leave to appeal refused, [2015] SCCA No 497, R v Khan, 2007 ONCA 779, R v Handy, 2002 SCC 56, R v Luciano, 2011 ONCA 89, R v Arnaud, 2017 ONCA 440, R v Pun, 2018 ONCA 240, leave to appeal refused, [2018] SCCA No 133, R v Caporiccio, 2017 ONCA 742, R v Loor, 2017 ONCA 696, R v Lohrer, 2004 SCC 80, R v Orwin, 2017 ONCA 841

R v Granados-Arana, 2018 ONCA 826

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

Counsel:

R. Posner and E. Taché-Green, for the appellant

D. Krick, for the respondent

Keywords: Criminal Law, Second Degree Murder, Manslaughter, Jury Instructions, Vetrovec Caution, R v MacGregor (1981), 64 CCC (2d) 353 (Ont CA), leave to appeal refused, [1982] SCCA No 246, R v Simpson, [1998] 1 SCR 3, R v Berry, 2017 ONCA 17, R v Daley, 2007 SCC 53, R v Zebedee (2006), 81 OR (3d) 583 (CA), R v Kanagalingam, 2014 ONCA 727, R v MacKinnon (1999), 43 OR (3d) 378 (CA)

R v Bollers, 2018 ONCA 817

[Simmons, Rouleau and Huscroft JJ.A.]

Counsel:

J. Dawe, as duty counsel

A.F. Bollers, in person

A. Hotke, for the respondent

Keywords: Criminal Law, Drug Offences, Gun Possession, Reasonable and Probable Grounds

R v Brown, 2018 ONCA 818

[Simmons, Rouleau and Huscroft JJ.A.]

Counsel:

M. Gourlay, as duty counsel

R.C. Brown, in person

J.S. Joy, for the respondent

Keywords: Criminal Law, Vetrovec Caution

R v Fraser, 2018 ONCA 820

[Simmons, Rouleau and Huscroft JJ.A.]

Counsel:

L.P. Strezos, as duty counsel

N. Fraser, in person

J.S. Joy, for the respondent

Keywords: Criminal Law, Prohibited Firearms, Sentencing

R v GM, 2018 ONCA 821

[Simmons, Rouleau and Huscroft JJ.A.]

Counsel:

J. Dawe, as duty counsel

G.M., in person

G. Choi, for the respondent

Keywords:

Criminal Law, Threat to Cause Bodily Harm, Sufficiency of Reasons, Evidence, Prior Consistent Statement, Credibility

R v Giesbrecht, 2018 ONCA 822

[Simmons, Rouleau and Huscroft JJ.A.]

Counsel:

M. Dineen, as duty counsel

D. Giesbrecht, in person

A. Hotke, for the respondent

Keywords: Criminal Law, Assault Causing Bodily Harm, Sufficiency of Reasons, Sentencing

R v HL, 2018 ONCA 823

[Simmons, Rouleau and Huscroft JJ.A.]

Counsel:

M. Dineen, as duty counsel

H.L., in person

H. Freeman, for the respondent

Keywords: Criminal Law, Sufficiency of Reasons, Sentencing

R v Merritt, 2018 ONCA 824

[Simmons, Rouleau and Huscroft JJ.A.]

Counsel:

A. Faith, as duty counsel

D. Merritt, in person

H. Freeman, for the respondent

Keywords: Criminal Law, Jury Instructions, Sentencing

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Authors
John Polyzogopoulos
Events from this Firm
6 Feb 2019, Other, Toronto, Canada

When it comes to class actions, costs regimes vary across Canada. Ontario follows the traditional two-way costs regime while other jurisdictions like British Columbia have adopted a no cost regime.

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