Ontario Court of Appeal Considers Contractual Duty of Good Faith

Andrew Ottaway, B.A. (Hons.), LL.B.Commercial0 Comments

In CM Callow Inc. v. Zollinger, 2018 ONCA 896 (CanLII) the plaintiff company provided maintenance services to condos managed by the defendant condo corporations. The defendants entered in two two-year maintenance contracts with the plaintiff: one for summer maintenance and one for winter maintenance.  The winter contract (which ran from November 2012 to April 2014) allowed for early termination by the defendants on 10 days’ notice. In March or April of 2013, the defendants decided to terminate the winter contract, but did not provide notice of termination of the agreement until September 12, 2013.  The defendants delayed informing the plaintiff that they were terminating the contract in order to avoid interfering with the defendant’s work under the summer contract (which ran from May 2012 to October 2013).  The plaintiff provided free work in the summer of 2013 as an incentive for the defendants to renew the contracts. The defendants knew … Read More

Renewal time for professional liability insurance? Mind the gap!

R. Lee Akazaki, C.S., B.A. (Hons.), J.D.Business Law, Civil Litigation, Insurance0 Comments

How can a policyholder who purchased consecutive policies of professional liability insurance lose the benefit of insurance?  On October 29, 2018, the Ontario Superior Court released its judgment in Cronnox Inc. v. Lloyd’s Underwriters, 2018 ONSC 6437 (CanLII), holding that the professional liability insurer did not owe the policyholder a duty to defend or to indemnify it in respect of a subrogated law suit.  It was the second part of an insurance coverage dispute among an engineering company, two insurers and a law firm.  In the first instalment, the same court also held earlier this year that the second insurer in the sequence was also not liable: Liberty Mutual Insurance Company v. Cronnox Inc., 2018 ONSC 1578 (CanLII). In September, 2013, the policyholder chose not to act on letters and emails from counsel for subrogating insurers who had paid to repair damage to a Toronto-area hotel, allegedly in the millions … Read More

Supreme Court Considers an ISP’s Right to Costs in Norwich Orders for Copyright Infringement

Peter Neufeld, B. Soc. Sc., J.D.Appeals, Appellate Advocacy, Civil Litigation, Commercial, Copyright Infringement, Intellectual Property, Norwich Order0 Comments

Norwich Orders have become a common tool to detect wrongdoers hiding behind the elusive veil of the internet. Whether the matter is with respect to defamation, intellectual property infringement, or fraud, the equitable remedy of pre-action discovery to compel Internet Service Providers (“ISPs”) to disclose a wrongdoer’s identity can help claimants determine their causes of action before they commence litigation. A question that has been raised, however, is who bears the costs of the Norwich Order? Is it the claimant seeking the Norwich Order or the ISP subject to the equitable remedy? To complicate the matter further, how does this interact with an ISP’s obligations under the “notice and notice” regime pursuant to Canada’s Copyright Act? By way of background, ss. 41.25 and 41.26 of the Copyright Act govern the statutory “notice and notice” regime for alerting alleged copyright infringers in Canada. These sections under the Copyright Act state that … Read More

Andrew Ottaway Co-Chairs Continuing Legal Education Program for Ontario Bar Association

Andrew Ottaway, B.A. (Hons.), LL.B.Civil Litigation, Gilbertson Davis LLP News0 Comments

Andrew Ottaway was the co-chair of a legal education program on pleadings for the Ontario Bar Association.  The topics covered included: Pleadings basics; Pleading complex causes of action, including fraud, misrepresentation, breach of trust, malice, conspiracy, oppression and defamation; Pleading Foreign Law; Pleading Motions, including striking the opposing party’s pleadings; and Amending Pleadings. See the complete agenda and the panel of speakers here. The lawyers at Gilbertson Davis are regularly asked to contribute to professional development programs, as chairs and speakers.

The Ontario Securities Commission and the “Active Market”

Peter Neufeld, B. Soc. Sc., J.D.Administrative Law, Appeals, Business Law, Business Litigation, Class Action Defence, Directors' and Officers' Liability, Finance Litigation, Investment | Financial Services, Professional Liability, Professional Services, Professions, Securities Litigation, Shareholder Disputes0 Comments

Determining what constitutes an “active market” for securities can have significant implications for Investment Dealers, Approved Persons, and other market participants facing civil lawsuits and regulatory scrutiny.  Such a determination provides ample assistance to investors seeking to quantify damages allegedly sustained through (1) misrepresentations in a company’s financial documents or (2) the negligence of their financial advisors. In Sutton (re), 2018 ONSEC 42, however, the failure to show an active market for securities proved devastating to the defence of a Chief Financial Officer (“CFO”) in charge of pricing those securities. Background  As CFO of First Leaside Securities Inc. (“FLSI”), Brian Sutton’s (“Mr. Sutton”) position required him to assess the price of certain unlisted securities (“Fund Units”) issued by three limited partnerships (“Funds”). In pursuit of meeting these obligations,  Mr. Sutton relied on the Fund Units’ allegedly active market to ascribe an appropriate price. The Industry Investment Regulatory Organization of Canada (“IIROC”) … Read More

Waivers of Liability Enforced in Schnarr v Blue Mountain Resorts Ltd.

Yona Gal, J.D., Articling StudentCivil Litigation, Contract Disputes, Negligence0 Comments

What happens when statutes collide? In Schnarr v Blue Mountain Resorts Limited, the Ontario Court of Appeal was recently asked to bar a negligence suit by enforcing waivers of liability signed by skiers visiting a ski resort. The issues in the case clustered around the dual application of both the Occupiers’ Liability Act (“OLA“) and the Consumer Protection Act (“CPA“) to agreements between skiers and ski resorts. As an occupier of premises, ski resorts are subject to the OLA.  To encourage landowners to make their property available for recreational activities, the OLA allows for landowners to limit their liability through waivers of liability.  However, as a consumer agreement, these ski resort contracts are also governed by the CPA.  The CPA requires services supplied under a consumer agreement to be of a reasonably acceptable quality and deems waivers purporting to limit resultant liability to be void. The concurrent governance of the OLA and … Read More

Ontario Court Finds No Jurisdiction in Multinational Class-Action against Volkswagen

Andrew Ottaway, B.A. (Hons.), LL.B.Commercial0 Comments

In Leon v. Volkswagen AG, 2018 ONSC 4265 (CanLII), the plaintiff, who resides in Ontario, purchased American Deposit Receipts (ADRs) in respect of Volkswagen shares. The Volkswagen shares plummeted when Volkswagen disclosed that it had perpetrated fraud. Owners of the common shares commenced proceedings in Germany.  The plaintiff initially commenced a class action in respect of his ADRs in New Jersey. The plaintiff conceded in the New Jersey action that the US Federal Court had jurisdiction over the subject matter of the claim and that the venue was proper. However, the plaintiff later withdrew from the US proceedings and commenced the subject class action in Ontario.  The Ontario class action included Ontario purchasers of the ADRs and of common shares (unlike the US proceedings, which were in respect of ADR purchasers only).   Volkswagen brought a motion to dismiss the action on the basis that Ontario did not have jurisdiction … Read More

Liability Possibilities for Third-Party Privacy Invasions in Agnew-Americano v Equifax Canada

Yona Gal, J.D., Articling StudentCyber Risks, Cyber Security, Privacy, Technology and Internet0 Comments

A company learns its cybersecurity is vulnerable to hacking but fails to implement preventative measures.  Hackers attack and access the private data of clients.  Can these clients sue the company for the tort of privacy invasion (“intrusion upon seclusion”) or can the company escape liability because it has only allowed a third-party invasion? The question turns on the definition of invasion.  As held in the leading case of Jones v Tsige, the tort of intrusion upon seclusion consists of three elements: Intentional or reckless conduct; That invades the defendant’s privacy; and The invasion must reasonably be regarded as highly offensive causing distress, humiliation or anguish. Does allowance of a third-party invasion meet the second requirement? In deciding which of two actions should proceed as a class action in Ontario, the Court in Agnew-Americano v Equifax Canada expressed preliminary support favouring the possibility of liability for third-party invasions.  The Court held claims that … Read More

#MeToo – The Assessment of Damages in Sexual Assault Cases

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Appeals, Appellate Advocacy, Negligence, Sexual Assault, Sexual Harassment0 Comments

The Ontario Court of Appeal recently released the decision in Zando v. Ali, 2018 ONCA 680, which involved an appeal of an assessment of damages in a sexual assault case.  This case confirms the principles to be used in determining damages in civil sexual assault cases and is particularly relevant in the current climate of the #MeToo movement. In this case, the parties were physicians and colleagues at the Sarnia General Hospital.  They had initially met after their residency examination in Toronto and became friends.  They were both married and had immigrated from Pakistan.  After completing their respective training elsewhere, they both ended up practicing medicine at the Sarnia General Hospital. The respondent alleged that the appellant sexually assaulted her on June 22, 1999 at her house.  The appellant had attended her house to complete an insurance medical form.  After completing the insurance form, the respondent alleged that the appellant took his clothes off, tripped her to the floor and sexually assaulted her. The trial … Read More

An Uber Quick Ride in Oshawa (City) v Greaves

Yona Gal, J.D., Articling StudentAdministrative Law, Appeals, By-laws, Judicial Review0 Comments

What is the definition of a taxi ride? A version of this question recently arrived at the Ontario Court of Justice in Oshawa (City) v Greaves. An Oshawa by-law makes it illegal to operate a taxicab without a valid license.  Last year, as part of a project concerning unlicensed taxicabs, a municipal by-law officer ordered an Uber in Oshawa.  When the Uber arrived at the requested location, the driver found himself collecting a by-law infraction charge instead of a waiting passenger.  On appeal before the Ontario Court of Justice, counsel for the driver argued that the driver did not illegally operate a taxicab because no taxi ride occurred. Nonetheless, the Court upheld the by-law charge.  The Court relied on the standard approach to statutory interpretation, which reads a statute by its “grammatical and ordinary sense” in light of the broader objectives and intentions of the legislation.  Central to the Court’s … Read More

Real Estate Litigation: Failure to Give Extension of Closing Date is not Bad Faith

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Certificate of Pending Litigation, Civil Litigation, Commercial and Contract Litigation, Contract Disputes, Contract Termination, Real Estate | Developers, Real Estate Agent and Broker, Real Estate Litigation, Specific Performance, Summary Judgment0 Comments

The recent summary judgment motion decision in Time Development Group Inc. v. Bitton, 2018 ONSC 4384, involves a situation that arises quite often in failed closings of real estate transactions.  One of the main causes for an aborted real estate transaction is the failure of the purchaser to obtain the required financing to close on the transaction, possibly influenced by the Ontario Fair Housing Plan and the new mortgage lending rules. In this case,  the plaintiff entered into an agreement to purchase three adjoining properties for a residential home redevelopment project.  There were a series of amendments to the agreement with the terms as follows: (a) purchase price of $10.55 million; (b) deposit of $500,000; (c) two vendor take back mortgages; and (d) closing date of July 31, 2017.  The plaintiff had secured a commitment letter to finance the transaction, however, six days before the closing date, the plaintiff was dismayed to find out that their financing had been withdrawn because the market conditions had changed.  … Read More

Canadian Court Shuts Down Loan Shark’s Law Suit

R. Lee Akazaki, C.S., B.A. (Hons.), J.D.Business Law, Business Litigation, Casino Debt Recovery, Civil Litigation, Commercial Lending, Commercial Litigation, Debt and Enforcing Judgments, Real Estate Litigation0 Comments

In Canada, it is not everyday one witnesses a loan shark resorting to judicial process to collect on outstanding obligations.  In fact, outside cases involving payday loans and hidden credit card fees, where legitimate loans might inadvertently cross the 60% interest rate threshold under s. 347 of the Criminal Code,  we have to date not seen any cases where the court has considered enforcement of blatantly usurious loans bearing interest of, say, 2,000% APR, as the Superior Court did in Ikpa v. Itamunoala, now available on line. Gilbertson Davis successfully obtained summary judgment rejecting the bid by the plaintiff, a resident of the United Kingdom (where laws banning usury no longer exist), to recover USD$500,000 on a USD$100,000 promissory note that had remained outstanding for four months before the start of litigation.  The plaintiff sought to have an equitable mortgage securing the note paid out in priority to the defendants’ registered mortgage.  … Read More

Dominican Republic Vacation Claim Examined in Di Gregorio v. Sunwing Vacations Inc.

Janice Perri, B.A. (Summa Cum Laude)Appeals, Appellate Advocacy, Civil Litigation, Commercial Contracts, Contract Disputes, Cross-Border Litigation, Jurisdictional Challenges, Negligence, Summary Judgment, Travel & Tour Operators, Travel & Tourism0 Comments

In Di Gregorio v. Sunwing Vacations Inc., the appellants purchased a vacation package to attend the Dreams Punta Cana Resort and Spa through their travel agent, Sunwing Vacations Inc. (“Sunwing”). While on vacation, the balcony railing gave way resulting in the appellants sustaining injuries. The motion judge was found to have erred in not conducting a jurisdictional analysis pursuant to Club Resorts Ltd. v. Van Breda. The Court of Appeal stated that the relevant connecting factor is that the claim pleaded was based on an Ontario contract. The alleged tortfeasors do not need to be party to the contract, as all that is required is that a “defendant’s conduct brings it within the scope of the contractual relationship and that the events that give rise to the claim flow from the contractual relationship” as stated in Lapointe Rosenstein Marchand Melancon LLP v. Cassels Brock & Blackwell LLP. The Court of … Read More

A Successful Constructive Dismissal Claim in Hagholm v. Coerio Inc.

Janice Perri, B.A. (Summa Cum Laude)Appeals, Appellate Advocacy, Civil Litigation, Contract Disputes, Contract Termination, Employment, Employment & Wrongful Dismissal, Summary Judgment, Wrongful Dismissal0 Comments

Constructive dismissal occurs when an employee is indirectly and effectively dismissed from the position or terms he/she had previously agreed formed the employment. Without the consent of the employee, a substantial alteration is presented that fundamentally changes the terms of the agreed upon contract. Hagholm v. Coerio Inc. represents a successful claim for constructive dismissal. The respondent had entered into her employment on the understanding that she could work from home three days a week. When this condition was changed, the respondent claimed constructive dismissal and ceased coming to work. The Motion Judge, on a motion for summary judgment, found that there was constructive dismissal because this was an essential term and the appellant arbitrarily withheld a bonus from the respondent. The Court of Appeal also confirmed that the respondent was not required to mitigate her damages for the appellant’s breach of contract in these circumstances. Also in this case, the … Read More

An Illegal By-Law in Perelli v. The Town Corporation of Richmond Hill

Janice Perri, B.A. (Summa Cum Laude)Civil Litigation, Contract Disputes, Employment, Summary Judgment0 Comments

Matthew Stroh represented the plaintiff in Perelli v. The Corporation of the Town of Richmond Hill, 2017 ONSC 6062, who was successful on a motion for summary judgment declaring that The Corporation of the Town of Richmond Hill (“the Town”) By-Law 135-14 is illegal. From December 1, 2010 to November 30, 2014, the plaintiff was employed as an elected municipal councillor for Ward 2 of the Town. Upon the completion of his term, the plaintiff was entitled to severance pay, but only received a deducted amount due to the Town By-Law 135-14 (“the By-Law”) that authorized said deduction. The deduction represents the amount charged in postage by the plaintiff to the Town’s corporate account in conducting a survey. Justice Sutherland of the Ontario Superior Court of Justice found the By-Law to be invalid due to lack of statutory authority and void for bad faith. The By-Law was enacted without the plaintiff … Read More

Federal Court of Appeal Considers Reviewing of Evidence in Judicial Review Applications

Peter Neufeld, B. Soc. Sc., J.D.Administrative Law, Appeals, Business Litigation, Civil Litigation, Commercial, Commercial Litigation, Judicial Review0 Comments

In judicial review applications, like most legal proceedings, evidence plays an essential role in securing a successful result. This includes not just the quality of the evidence, but the process through which the court considers that evidence. The Federal Court of Appeal’s recent decision in Apotex Inc. v. Canada (Health), 2018 FCA 147 (“Apotex”) affirms the control accorded to judges when reviewing evidence in judicial review applications.