Court Of Appeal Summaries (August 8, 2022 – August 12, 2022) - Civil Law

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Here are our summaries of the civil decisions of the Court of Appeal for Ontario for the week of August 8, 2022.

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In Aylmer Meat Packers Inc. v. Ontario, the appellant meat producer, Aylmer, sued the Ontario Ministry of Agriculture, Food and Rural Affairs ("OMAF") in negligence after it had shut down and occupied its abattoir for 19-months, effectively putting it out of business. The trial judge dismissed the action, but the Court allowed the appeal. Shutting the plant down for that long was a breach of the duty of care owed by the regulator to the appellant.

Other topics covered this week included posting security for a judgment into court pending appeal to permit the sale of land to be completed, family law (relocation), and extension of time to perfect an appeal in the bankruptcy and insolvency context.

Table of Contents

Civil Decisions

Aylmer Meat Packers Inc. v. Ontario, 2022 ONCA 579

Keywords: Torts, Negligence, Trespass, Conversion, Crown Liability, Duty of Care, Anns/Cooper Test, Standard of Care, Causation, "But For" Test, Damages, Meat Inspection Act (Ontario), R.S.O. 1990, c. M.5, Dead Animal Disposal Act, R.S.O. c. D.3, Food and Drugs Act, R.S.C. 1985, c. F-27, s. 4(b), Criminal Code of Canada, R.S.C. 1985, c. C-46, s. 655, R. v. Baksh, 199 C.C.C. (3d) 201 (Ont. S.C.J.), affirmed 2008 ONCA 116, leave to appeal refused, [2008] S.C.C.A. No. 155, Cooper v. Hobart, 2001 SCC 79, Edwards v. Law Society of Upper Canada, 2001 SCC 80, Childs v. Desormeaux, 2006 SCC 18, Syl Apps Secure Treatment Centre v. D. (B.), 2007 SCC 38, Anns v. Merton London Borough Council, [1978] A.C. 728, Kamloops (City) v. Nielsen, [1984] 2 S.C.R. 2, Hill v. Hamilton-Wentworth Regional Police Services Board, 2007 SCC 41, R. v. Imperial Tobacco Canada Ltd., 2011 SCC 42, Nelson (City) v. Marchi, 2021 SCC 41, Fullowka v. Pinkerton's of Canada Ltd., 2010 SCC 5, Taylor v. Canada (Attorney General), 2012 ONCA 479, Just v. British Columbia, [1989] 2 S.C.R. 1228, Williams v. Toronto (City), 2016 ONCA 666, Bowman v. Ontario, 2022 ONCA 477, River Valley Poultry Farm Ltd. v. Canada (Attorney General), 2009 ONCA 326, leave to appeal refused, [2009] S.C.C.A. No. 259, Los Angeles Salad Company Inc. v. Canadian Food Inspection Agency, 2013 BCCA 34, Goodwin v. Goodwin, 2007 BCCA 81, Paradis Honey Ltd. v. Canada (Attorney General), 2015 FCA 89, Saadati v. Moorhead, 2017 SCC 28, Clements v. Clements, 2012 SCC 32, Donleavy v. Ultramar Ltd., 2019 ONCA 687, Deloitte & Touche v. Livent Inc. (Receiver of), 2017 SCC 63, Mustapha v. Culligan of Canada Ltd., [2008] 2 S.C.R. 114, Overseas Tankship (U.K.) Ltd. v. Miller Steamship Co. Pty., [1967] A.C. 617 (P.C.), Athey v. Leonati, [1996] 3 S.C.R. 458, Tokarz v. Cleave Energy Inc., 2022 ONCA 246, Bowman v. Martineau, 2020 ONCA 330, Janiak v. Ippolito, [1985] 1 S.C.R. 146

Tovmasyan v. Petrosian, 2022 ONCA 583

Keywords: Family Law, Parenting, Relocation, Spousal Support, Civil Procedure, Stay Pending Appeal, Children's Law Reform Act, R.S.O. 1990, c. C.12, Family Law Act, R.S.O. 1990, c. F.3, Ogden Entertainment Services v. United Steelworkers of America, Local 440 (1998), 38 O.R. (3d) 448 (C.A.), RJR-MacDonald Inc. v. Canada, [1994] 1 S.C.R. 311, D.C. v. T.B., 2021 ONCA 562, K.K. v. M.M., 2021 ONCA 407, Lefebvre v. Lefebvre [(2002)], 167 O.A.C. 85 (C.A.), Toronto (City) v. Ontario (Attorney General), 2018 ONCA 761

Jewish Foundation of Greater Toronto (Re), 2022 ONCA 581

Keywords: Bankruptcy and Insolvency, Civil Procedure, Appeals, Perfection, Extension of Time, Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, s. 43, Rules of Civil Procedure, Rules 21, 21.01 & 61.65, Dallas/North Group Inc. (Re) (2001), 148 O.A.C. 288 (C.A.), La Scala Bakery Ltd., Re (1984), 54 C.B.R. (N.S.) 194 (Ont. S.C.), Issasi v. Rosenzweig, 2011 ONCA 112, Kudrocova v. Kronberger, 2021 ONCA 563, MDM Plastics Limited v. Vincor International Inc.,2015 ONCA 28, Sabatino v. Posta Ital Bar Inc., 2022 ONCA 208

Leigh v. Rubio , 2022 ONCA 582

Keywords: Family Law, Parenting, Relocation, Hague Convention on the Civil Aspects of Child Abduction, article 11, 13(b) and 16 Can. T.S. 1983 No. 35, Children's Law Reform Act, R.S.O. 1990, c. C.12, section 46(2), Family Law Rules, O. Reg. 114/99, Office of the Children's Lawyer v. Balev, 2018 SCC 16, Hammerschmidt v. Hammerschmidt, 2013 ONCA 227, Hughes v. Hughes, 2014 BCCA 196, Ojeikere v. Ojeikere, 2018 ONCA 372

Tega Homes (Attika) Inc. v. Spencedale Properties Limited, 2022 ONCA 581

Keywords: Civil Procedure, Certificates of Pending Litigation, Writs of Seizure and Sale, Security, Rules of Civil Procedure, Rule 72.02, Rule 63.03(6), Courts of Justice Act, R.S.O. 1990, c. C.43, s 103(6)(a)(ii), s 134(2)

CIVIL DECISIONS

Aylmer Meat Packers Inc. v. Ontario, 2022 ONCA 579

[Lauwers, Roberts and Nordheimer JJ.A.]

COUNSEL:

J. C. Lisus and Z. Naqi, for the appellant
D. Kloeze and A. Mortimer, for the respondent

FACTS:

In 2003, after learning that Aylmer Meat Packers' plant was unlawfully processing sick and disabled animals and that employees were using an unlawful approval stamp, the Ministry of Agriculture, Food and Rural Affairs (OMAF) investigated and ultimately took over control of the plant and the abattoir ceased doing business. Shortly thereafter, the freezer malfunctioned and meat began to spoil. In 2004, OMAF undertook repairs but was unable to save the meat. In 2005, OMAF destroyed the meat and returned the plant to Aylmer. In 2007, Aylmer and two of its principals pleaded guilty for selling unauthorized meat and each was fined and sentenced to one year of probation. Its business destroyed, Aylmer sued OMAF for damages in negligence, trespass and conversion. The trial judge dismissed the claim.

ISSUES:

(1) Did OMAF owe Aylmer a private law duty of care in exercising its regulatory responsibilities?

(2) If so, did OMAF officials fail to meet the standard of care?

(3) If so, did OMAF's breaches cause Aylmer's losses?

(4) If so, what are Aylmer's damages?

HOLDING:

Appeal allowed.

REASONING:

(1) Did OMAF owe Aylmer a private law duty of care in exercising its regulatory responsibilities?

Yes. The private law duty of care is engaged when three elements are present: reasonably foreseeable harm, sufficient proximity between the plaintiff and the governmental defendant, and no residual policy considerations for declining to impose such a duty. Here, the harm on Aylmer's economic interests was a reasonably foreseeable consequence of suspending its license to operating and detaining its meat products. The analysis hinged on the Anns/Cooper test.

Proximity in the context of the negligence of governmental authorities is a previously established category where a duty of care has been recognized. The trial judge did not directly address the specific interactions between OMAF and Aylmer that gave rise to a duty of care. The trial judge did not correctly apply the Anns/Cooper analysis considering the specific interactions that were more than the ordinary regulatory contacts between OMAF and a regulated abattoir. Because the trial judge took too narrow a view of the factual matrix, she failed to find that a proximate relationship existed and did not impose a duty of care on OMAF.

The applicable policy consideration is whether the imposition of negligence on the government actor would trigger a conflict with its public duty; however, such policy concerns must be more than speculative and a real potential for consequences must be apparent. Governmental authorities can be subject to tort liability for operational decisions, but policy decisions are exempt from tortious claims. OMAF only made operational decisions and therefore owed Aylmer a duty to act reasonably in exercising its regulatory responsibilities.

The trial judge made three errors in this respect: first, her approach was inconsistent with the rigorous approach taken by the Supreme Court in Hill and Fullowka; second, she did not give effect to Hill or consider the possible "chilling effect" on government action; and third, she conflated the duty of care with the standard of care.

The trial judge erred in her approach to the interpretation of the legislation, in not considering the specific interactions between OMAF and Aylmer, and in her consideration of residual policy reasons to decline to impose a duty of care on OMAF. There was no residual policy reason for declining to impose a duty of care on OMAF. OMAF had a duty of care to ensure that its regulatory actions did not unreasonably or unnecessarily harm Aylmer's business interests.

(2) If so, did OMAF officials fail to meet the standard of care?

Yes. The standard of care applicable to OMAF and its officials was that of a reasonable health and food safety regulator and, in this case, the plain facts were enough to meet the test of common sense. OMAF officials failed to meet the standard of care when they occupied the Alymer plant for 19 months, which was not a reasonable exercise of its statutory authority. A reasonable course of action by OMAF would have been to do in 2003 what it did in 2005, which was to remove the meat and vacate the plant. Further, OMAF took no steps to repair the malfunctioning fridge for 10 months, then when some repairs were performed, they were insufficient. These two improper actions breached OMAF's standard of care. The trial judge erred in describing OMAF's decisions as mere errors in judgment. There was no cogent reason why OMAF did not attend to what was going on in the plant, why OMAF did not ask or answer these basic questions by the end of 2003, or why the risk of these instances of ministerial ineptitude should fall on Aylmer. The regulator showed an outrageous disregard for the interests of the regulated entity to which it owed a duty of care, and breached its standard of care in the process by extending its occupation of the plant to 19 months.

(3) If so, did the Ministry's breaches cause Aylmer's losses?

Yes. The Ministry was both the cause-in-fact and the cause-in-law for Aylmer's injuries, as Aylmer's injuries would not have occurred "but for" OMAF's conduct, and the wrongful conduct was not too remote to be foreseeable. Aylmer's damages stemmed from an inability to sell the plant while under occupation by OMAF. Aylmer was not required to prove that OMAF's negligent conduct made it "impossible to sell" the plant. Aylmer had only to show that, but for OMAF's conduct, it would have been able to sell it. OMAF's prolonged occupation of the plant was a cause-in-fact of Aylmer's inability to sell the plant, on the evidence. But for OMAF's unreasonable occupation, in breach of the duty that it owed Aylmer, Aylmer would have sold the plant in a market that was eager to buy. The harm suffered by Aylmer was, therefore, not too remote to ground liability.

(4) If so, what are Aylmer's damages?

The basic tort principle for the determination of damages is that the plaintiff is to be placed in the position it would have been in had the defendant not committed the negligent act. The damages amount to the loss of enterprise value as found by the trial judge at $3,520,000. The Court awarded those damages. The Court refused to award damages for the value of the euthanized cattle and sales at a loss, as those losses were the direct and immediate result of Aylmer's illegal activities.

Tovmasyan v. Petrosian, 2022 ONCA 583

[Brown J.A. (Motion Judge)]

COUNSEL:

H. Niroomand, for the moving party
A. Mayer, for the responding party

FACTS:

The applicant and respondent are the father and mother of twins. The respondent, the mother, was permitted to relocate to California with the children and granted spousal support. On this motion, the father sought a stay of both the relocation and support elements of the judgment made pursuant to the Children's Law Reform Act.

ISSUES:

(1) Has the applicant provided some evidence-based demonstration that key findings of fact are tainted by palpable and overriding error?

(2) Has the applicant demonstrated that if a stay is not granted, the children will suffer irreparable harm?

(3) Has the applicant demonstrated that he would suffer irreparable harm if a stay of the support orders was not granted?

HOLDING:

Motion dismissed.

REASONING:

(1) In determining whether to stay an order involving the parenting of a child, the courts must consider: (1) whether, on a preliminary assessment, the appeal raises a serious question (recognizing that this is a low threshold); (2) whether the child will suffer irreparable harm if a stay is refused; and (3) the balance of convenience: namely whether there would be greater harm from the granting or refusal of a stay pending a decision on the merits of the appeal.

Here, the rights of the parties were to be determined by the outcome of the stay motion. Accordingly, the Court gave significantly more weight to the strength of the merits of the appeal, due to the outcome of the motion having the potential to alter the children's living arrangements.

The applicant filed a "very thin record" to support the stay. The Court found this to be a significant omission, as the applicant raised 16 discrete grounds for appeal. The Court found that the reasons clearly explained the findings of fact, and the applicant failed to adduce evidence that any of such findings were tainted by palpable and overriding error.

(2) The applicant failed to demonstrate that, on the relocation portion of the stay, the children would suffer irreparable harm if the stay were not granted. The trial judge found that the best interests of the children would be served by moving to California, that they had a stronger bond with their mother, and that the father had a history of perpetuating family violence. The Court was therefore not persuaded that the stay was necessary to prevent the children from suffering irreparable harm.

(3) No. The harm the applicant complained of was purely monetary in nature. The applicant deposed that he was unable to afford the support order. The Court placed little weight on the applicant's evidence for two reasons. First, the trial judge extensively reviewed the applicant's financial disclosure, and held that the applicant was blatantly delinquent in meeting disclosure obligations. This led the Court to view the new financial evidence with skepticism. Second, several discrepancies emerged within the applicant's financial statement regarding debts of the applicant. Such discrepancies reinforced the Court's view that the applicant's new evidence should be met with skepticism.

Jewish Foundation of Greater Toronto (Re), 2022 ONCA 581

[Gillese J.A. (Motion Judge)]

COUNSEL:

W. Jaskiewicz and M. Ly, for the Appellant/Moving Party
M. P. Gottlieb, P. Fruitman and X. Li, for the Respondent/Responding Party

FACTS:

The appellant brought an application pursuant to s. 43 of the Bankruptcy and Insolvency Act, for an order adjudging the respondent bankrupt. The application was dismissed (the "Decision") and the appellant served a notice of appeal of the Decision and on April 21, 2022 filed the notice of appeal (the "Appeal"). On June 27, 2022, the respondent moved to have the Appeal dismissed for delay and on July 7, 2022 the appellant filed the documents necessary to perfect the Appeal, but through inadvertence, did not include an issued and entered copy of the application judge's order (the "Order"). On July 8, 2022 the court sent the appellant an email advising that it had not accepted the appeal book and compendium for filing because it did not include a copy of the Order. However, due to the Rogers outage that day the appellant did not receive that email until July 11, 2022. By order dated July 11, 2022, the Registrar dismissed the appeal for delay.

The appellant took the position that it had a bona fide intention to appeal throughout, and it had a reasonable explanation for its delay. The responding party maintained its position that the Motion should be dismissed because the Appeal was meritless and granting the Motion would significantly prejudice the respondent.

ISSUES:

(1) Should the Court set aside the Registrar's dismissal order and extend the appellant's time to perfect its appeal?

HOLDING:

Motion granted.

REASONING:

(1) Yes. The Court is to consider the following factors on a motion to set aside a Registrar's dismissal order and to extend the time to perfect; (1) whether the appellant formed an intention to appeal within the relevant period and maintained that intention; (2) the length of the delay and explanation for it; (3) any prejudice to the respondent caused by the delay; (4) the merits of the appeal; (5) and whether the "justice of the case" requires it.

The Court found there was no question that the appellant formed the intention to appeal within the relevant time. The Court also accepted the appellant's explanation for the period of delay as reasonable. The delay in attempting to perfect was short and the problem that prevented the appellant from perfecting was minor and had been remedied. Thus, the Court was satisfied of the explanation for the delay.

The Court must consider any prejudice to the respondent's ability to defend the appeal that would arise from steps taken following its dismissal or that would result from its restoration. The respondent made no claim of prejudice arising from steps it had taken following the Registrars' Order dismissing the Appeal for delay. The respondent's claim of prejudice failed to recognize that the appellant had a right to appeal the Order and therefore the Court found that no prejudice would result from the restoration of the Appeal.

The appellant did not need to convince the Court that its Appeal will succeed. The Court need only determine whether the Appeal has so little merit that the court could reasonably deny the important right of an appeal. In the Court's view, there were grounds of appeal with sufficient merit to meet that low threshold, including those relating to the application judge's findings of a collateral purpose and an abuse of process, her reliance on r. 21 of the Rules, and the substantial indemnity scale of costs used to establish the Costs Order as well as the reasonableness of the quantum. In any event, even where it is difficult to see the merits of a proposed appeal, a party should not be deprived of the right to appeal where there is no real prejudice to the other side.

Leigh v. Rubio , 2022 ONCA 582

[Benotto, Zarnett and Thorburn JJ.A.]

COUNSEL:

M.B.L., acting in person
A. Van Deven, for the respondent

FACTS:

In 2019, the respondent mother wrongfully removed her child from their home country of Peru to Canada. The appellant father promptly brought an application under the Hague Convention for the return of their child. After one and a half years the application was heard. The application judge confirmed that the child's habitual residence was Peru and that it had been wrongfully removed. However, the application judge dismissed the appellant's application to return the child based on Article 13(b) of the Convention, exception to mandatory return, as it would place the child in an intolerable situation given the amount of time the child had already been estranged from its father in Peru.

ISSUES:

(1) Did the application judge's process lead to a delay?

(2) Are the gaps in the application judge's analysis relevant to the parenting case before the Ontario court?

(3) What is the appropriate remedy?

HOLDING:

Appeal dismissed.

REASONING:

(1) Yes. The application judge's analysis led to a delay because the judge chose not to rely on the Peruvian court's decision that determined the child was not at grave risk. The Court found that the application judge unnecessarily delayed the proceedings by not appropriately assessing the issues. The delay not only contravened the court's obligation, but it precluded meaningful appellate intervention. The delay itself amounted to a manifest or clear error.

(2) No. Given the standard of review, none of the errors asserted by the appellant rose to the level of reversible error.

The two gaps in the application judge's analysis were: (i) the failure to rationalize her conclusions with those of the Peruvian courts; and (ii) the recitation of the mother's evidence as fact. Although these gaps did not give rise to a reversible error, they do require that the Court approach the ongoing parenting application afresh.

(3) The ongoing parenting application under the CLRA should be case managed by a single judge. Furthermore, there ought to be an up-to-date assessment, and the involvement of the Children's Lawyer. The appellant was also encouraged to seek counsel to assist him.

Tega Homes (Attika) Inc. v. Spencedale Properties Limited, 2022 ONCA 588

[Brown J.A. (Motion Judge)]

COUNSEL:

T.G. Conway and K. Caron, for the appellants
D. Cutler, for the respondent

FACTS:

The appellants, Spencedale Properties Ltd and Markton Properties Ltd, own two properties in Ottawa. They entered into an agreement of purchase and sale ("APS") to transfer title to the properties to the respondent, Tega Homes. The APS did not close, and the respondent obtained certificates of pending litigation ("CPLs") against the properties.

In 2018, Gomery J. held that the appellants breached the APS, and therefore granted summary judgment. Damages were assessed by MacLeod R.S.J. in January 2022 in the amount of just under $1.5 million. The appellants appealed the judgment, which appeal is to be heard in January 2023. In April 2022, the respondent issued a writ of seizure and sale for the amount of the judgment. The appellants now wish to sell the properties to a third party. The appellants moved to have the CPLs and the writ vacated upon payment of the amount of the judgment into court pending the outcome of the appeal. The respondent argued that agreements reached in 2016 between itself and the appellants precluded the relief sought by the appellants.

ISSUES:

(1) Do the 2016 agreements preclude the appellants from obtaining the removal of the writ and CPLs on appropriate terms?

(2) If the writ and CPLs should be removed, what amount should the appellants pay into court as security?

HOLDING:

Motion granted.

REASONING:

(1) No. The 2016 agreements clearly contemplated that the appellants can sell the properties prior to the final resolution of the dispute if security is posted.

(2) The respondent argued that the proceeds from the pending sale should be posted as security. This amount far surpassed the amount of the judgment against the appellants. It was therefore unreasonable. The respondent did not cross-appeal from the judgment, so it was not likely that the judgment amount will increase. The security that should be posted was the amount of the judgment, plus interest and costs of the pending appeal totaling $1.75 million.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be ought about your specific circumstances.

Canada: Court Of Appeal Summaries (August 8, 2022 – August 12, 2022) Blaney's Appeals

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Civil Decisions

Aylmer Meat Packers Inc. v. Ontario, 2022 ONCA 579

Tovmasyan v. Petrosian, 2022 ONCA 583

Jewish Foundation of Greater Toronto (Re), 2022 ONCA 581

Leigh v. Rubio , 2022 ONCA 582

Tega Homes (Attika) Inc. v. Spencedale Properties Limited, 2022 ONCA 581

CIVIL DECISIONS

Aylmer Meat Packers Inc. v. Ontario, 2022 ONCA 579

COUNSEL:

FACTS:

ISSUES:

HOLDING:

REASONING:

(2) If so, did OMAF officials fail to meet the standard of care?

(3) If so, did the Ministry's breaches cause Aylmer's losses?

(4) If so, what are Aylmer's damages?

Tovmasyan v. Petrosian, 2022 ONCA 583

COUNSEL:

FACTS:

ISSUES:

HOLDING:

REASONING:

Jewish Foundation of Greater Toronto (Re), 2022 ONCA 581

COUNSEL:

FACTS:

ISSUES:

HOLDING:

REASONING:

Leigh v. Rubio , 2022 ONCA 582

COUNSEL:

FACTS:

ISSUES:

HOLDING:

REASONING:

Tega Homes (Attika) Inc. v. Spencedale Properties Limited, 2022 ONCA 588

COUNSEL:

FACTS:

ISSUES:

HOLDING:

REASONING:

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Canada: Court Of Appeal Summaries (August 8, 2022 – August 12, 2022)
Blaney's Appeals