Source: http://isthatlegal.ca/index.php?name=518-case-law
Timestamp: 2019-04-21 06:11:46+00:00

Document:
In this wide-ranging commercial litigation case the Court of Appeal canvassed a number of issues.
 Rule 25.07(4) of the Rules of Civil Procedure requires a defendant to plead any matter on which he intends to rely to defeat the claim of the opposite party and which, if not specifically pleaded, "might take the opposite party by surprise or raise an issue that has not been raised in the opposite party's pleading." This requires a party to plead an affirmative defence, such as a plaintiff's lack of standing to sue: Concord Kitchens GP Inc. v. Eastern Construction Company Limited, 2010 ONSC 2168 (CanLII), at paras. 102-105; Huber v. Way, 2014 ONSC 4426 (CanLII), at paras. 66-68.
The failure to raise substantive responses to a plaintiff’s claims until trial or, worse, until the close of trial, is contrary to the spirit and requirements of the Rules of Civil Procedure and the goal of fair contest that underlies those Rules. Such a failure also undermines the important principle that the parties to a civil lawsuit are entitled to have their differences resolved on the basis of the issues joined in the pleadings…. [W]here a defence to a civil action is not pleaded and no pleadings amendment is obtained, judges should generally resist the inclination to allow a defendant to raise and rely on the unpleaded defence if trial fairness and the avoidance of prejudice to the plaintiff are to be achieved.
 The rule is not absolute. This court has excused defendants from their failure to raise an affirmative defence in the pleadings where the issue was otherwise clearly raised and put in issue before trial: Reliable Life Insurance Company v. M.H. Ingle & Associates Insurance Brokers Ltd. (2002), 2002 CanLII 41603 (ON CA), 59 O.R. (3d) 1 (C.A.), at para. 36. However, raising a potentially dispositive issue during closing submissions, after the close of evidence, may well prove too late.
 Fraudulent misrepresentation is established where there are the following five elements: (i) a false representation of fact by the defendant to the plaintiff; (ii) knowledge the representation was false, absence of belief in its truth, or recklessness as to its truth; (iii) an intention the plaintiff act in reliance on the representation; (iv) the plaintiff acts on the representation; and (v) the plaintiff suffers a loss in doing so: Amertek Inc. v. Canadian Commercial Corp. (2005), 2005 CanLII 23220 (ON CA), 76 O.R. (3d) 241 (C.A.), at para. 63, leave to appeal refused,  S.C.C.A. No. 439.
 A misrepresentation can involve not only an overt statement of fact, but also certain kinds of silence: the half-truth or representation that is practically false, not because of what is said, but because of what is left unsaid; or where the circumstances raise a duty on the representor to state certain matters, if they exist, and where the representee is entitled, as against the representor, to infer their non-existence from the representor’s silence as to them: Robert van Kessel & Paul Rand, The Law of Fraud in Canada (Toronto: LexisNexis Canada Inc., 2013), at §2.69 and 2.72.
 The significance of silence always falls to be considered in the context in which it occurs: Demagogue Pty. Ltd. v. Ramensky (1992), 39 F.C.R. 31 (Austral. F.C.), at p. 32. As explained by Professor Waddams: “Almost always something is said to induce the transaction and it is open to the court to hold that the concealment of the material facts can, when taken with general statements, true in themselves but incomplete, turn those statements into misrepresentations”: S.M. Waddams, The Law of Contracts, 6th ed. (Toronto: Canada Law Book Inc., 2010), at para. 439.
7. the resulting loss or damage to the plaintiff.
Of course, if deceit is alleged, then there must also be an allegation that the defendant knew of the falsity of his statement…. Each of the defendants must know the case that it has to meet.

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