WARNING

THIS IS AN APPEAL UNDER THE

CHILD AND FAMILY SERVICES ACT

AND IS SUBJECT TO S. 45 OF THE ACT WHICH PROVIDES:

45(7)  The court may make an order,

(a) excluding a particular media representative
    from all or part of a hearing;

(b) excluding all media representatives
    from all or a part of a hearing; or

(c) prohibiting the publication of a
    report of the hearing or a specified part of the hearing,

where the court is of the opinion that the
    presence of the media representative or representatives or the publication of
    the report, as the case may be, would cause emotional harm to a child who is a
    witness at or a participant in the hearing or is the subject of the proceeding.

45(8)
No person shall
    publish or make public information that has the effect of identifying a child
    who is a witness at or a participant in a hearing or the subject of a
    proceeding, or the childs parent or foster parent or a member of the childs
    family.

45(9)
The court may
    make an order prohibiting the publication of information that has the effect of
    identifying a person charged with an offence under this Part.

COURT OF APPEAL FOR ONTARIO

CITATION: Catholic
    Children's Aid Society of Toronto v. A.Y., 2015 ONCA 493

DATE: 20150703

DOCKET: C59715

Weiler, Cronk and Pepall
    JJ.A.

IN THE MATTER OF the
Child and Family Services Act
,
    R.S.O. 1990, c. C.11, as amended

AND IN THE MATTER OF the Children:

Y.N.Y.

M.L.Y.

S.C.H.Y.

M.K.Y.

BETWEEN

Catholic Childrens Aid
    Society of Toronto

Applicant (Respondent)

and

A.Y.

Respondent (Appellant)

and

P.Y.

Respondent (Appellant)

A.Y. and P.Y., acting in person

Rena Knox, for the Catholic Childrens Aid Society of
    Toronto

Catherine Bellinger, for the Office of Childrens
    Lawyer on behalf of the children

Heard: May 15, 2015

On appeal from the order of Justice
    Craig Perkins of the Superior Court of Justice, dated November 10, 2014.

ENDORSEMENT

[1]

The appellants submit that the judge at first instance erred in granting
    Crown wardship of their four children, now aged 16, 13, 9, and 6 years old, on
    the motion for summary judgment brought by the respondent, the Catholic
    Childrens Aid Society of Toronto (the CCAS). The grounds of appeal raised before
    the summary judgment appeal judge fell into three broad groups: (i) procedural
    fairness issues and whether summary judgment ought to have issued; (ii)
    evidentiary issues, such as misapprehension of the evidence, overemphasis of some
    aspects of the evidence, failure to consider other aspects of the evidence and
    lack of evidence for certain findings; and (iii) the nature of the order that
    ought to have been made.

[2]

We see no error in the decision of the summary judgment appeal judge.
    With respect to the specific issues raised by the appellants on appeal, we
    conclude as follows.

Crown Wardship

[3]

The order that the children were in need of protection and making them
    Crown wards was properly made. Notwithstanding the voluminous fresh evidence
    filed on this appeal, we are of the opinion that Crown wardship continues to be
    in the best interests of the children. We note that this disposition is in
    accordance with the wishes of the children.  As the summary judgment appeal
    judge observed, a childs wishes, especially as he or she grows older, are an
    important component of the determination of the childs best interests.

[4]

Accordingly, the appeal with respect to Crown wardship is dismissed.

Proposed Parental Access

[5]

With respect to access by the parents, the summary judgment appeal
    judge noted, at para. 47 of his reasons:

[T]he test involves not only a beneficial and meaningful
    relationship, but also a finding that access would be in the childrens best
    interests. There was evidence about how the parents had taken advantage of
    contact initiated by the children in the past three years to blame them for
    destroying the family.

[6]

Having regard to the reasons for which Crown wardship was ordered and
    the onus on the parents under s. 59(2.1) of the
Child and Family Services
    Act
, R.S.O. 1990, c. C.11, the motion judge concluded that the parents also
    failed on the access issue and ordered no access.

[7]

In our view, on the record before him, the summary judgment appeal
    judges conclusion on access was fully justified.  The record indicated that
    none of the children had then expressed any desire to see their parents,
    although one of the children (Y.N.Y.) had proposed making a video to send to
    his parents.

[8]

That said, at the appeal hearing, this court was informed that at times
    the two eldest children had expressed a wish to have some contact with their
    parents, either by telephone or by the making of a video for them. Indeed, the eldest
    child, Y.N.Y., had made a video for his parents and it was given to them in
    court by the representative of the CCAS.

[9]

Counsel for the CCAS pointed out that the children are emotionally
    fragile.  All of them want the parents to accept responsibility for the harm
    they have caused.

[10]

In
    these circumstances, the court asked the appellants and counsel for the CCAS
    and the Office of the Childrens Lawyer to indicate how access could be
    compatible with the best interests of a particular child if that child wished
    contact with a parent. Counsel responded that if a child is desirous of such contact,
    and the childs therapist agreed that contact with the parent would be in the
    best interests of that child, the CCAS would be at liberty to arrange such
    contact.  It is anticipated that any such contact would proceed on the
    following basis:

·

The parent  would  write a letter to the relevant child saying
    the parent is sorry for any harm he or she may have caused the child;

·

Once this initial letter has been written, other letters may follow
    on the understanding that the tone of the letters are respectful and do not
    attempt to place any blame or guilt on the child for what has transpired;

·

If the child wishes, the child may make a video to be given to
    the parents;

·

The parent would engage in a mediated discussion with the childs
    therapist about the video that has been made.  For example, with respect to Y.N.Y,,
    the parent and therapist would talk about the video that Y.N.Y. made and about
    how he feels about what happened to him;

·

Provided the outcome of the discussion with the childs therapist
    is positive, a parent  may make a video to be given to the child once that
    video has been approved by the childs therapist ; and

·

Prior to any in-person supervised visit with a child, the parent
    would also engage in a therapeutic process aimed at implementing supervised
    reunification visits with the children.

[11]

If
    this process is implemented and successfully completed, the CCAS indicated it
    would be prepared to move to vary the no access order.

[12]

The
    appellants did not object to the above-noted features of a potential future
    parental access plan.

[13]

Accordingly,
    while we must also dismiss the appeal with respect to the issue of access on
    the basis of the existing record, we do so on the understanding that if the
    process outlined above takes place, the no access order in respect of parental
    access may be potentially varied.

Proposed Access to Maternal Grandmother

[14]

The
    summary judgment appeal judge declined to deal with a request by the Childrens
    Lawyers agent for access by the childrens maternal grandmother to the oldest
    child and possibly the second oldest child as well. The request was opposed by
    the CCAS at the time and there was no evidence as to how such access would be
    in the best interests of either child.  The summary judgment appeal judge noted
    that the CCAS had indicated that it would continue to try and arrange access to
    the grandmother, taking into account each childs wishes and the
    recommendations of his or her treating professionals.

[15]

Before
    this court, the CCAS advised that Y.N.Y. had written a letter to his maternal
    grandmother and was hoping for a reply. The childrens maternal grandmother was
    present in court and Y.N.Y.s letter was given to her. The CCAS and Childrens
    Lawyers agent are not opposed to the grandmother having contact with Y.N.Y. by
    writing to him.  Further, the court was informed that the CCAS no longer
    opposes a supervised visit by the maternal grandmother with Y.N.Y., provided he
    wishes to see her and provided further that the grandmother  agrees to meet
    with a bilingual CCAS worker a half hour ahead of the supervised visit to be
    briefed on how the visit should be conducted.

[16]

On
    the record before us, it is premature to conclude that court-ordered access by
    Y.N.Y. to his maternal grandmother is in Y.N.Y.s best interests.  However, there
    have been two developments since this issue was before the summary judgment appeal
    judge.  First, by writing a letter to his grandmother, Y.N.Y. has indicated
    that he wishes to have contact with her.  Second, the CCAS has now given qualified
    agreement to access by the maternal grandmother.

[17]

Accordingly,
    it appears to us that initial steps have now been taken to move towards potential
    access.  That said, on the record before us, no new court order is warranted or
    required at this time.

Alternate Plan of Care

[18]

Finally,
    we observe that the CCAS filed as fresh evidence a report dealing with an
    alternate proposed plan of care by the childrens relatives in France that was
    in the French language and that had not been translated. The CCAS offered no
    explanation for the failure to have this document properly translated and, in
    response to questions from the panel, indicated it could likely have had the
    document translated in two days. While the members of the panel were able to
    overcome this obstacle, we caution that in future the CCAS should obtain a
    certified translation of relevant documents in advance or risk having the
    appeal adjourned until that is done. Having to adjourn in order to have
    documents translated into the appropriate language is a hindrance to the due
    administration of justice and unnecessary delay is not in the best interests of
    the children whom the CCAS is mandated to protect.

[19]

The
    alternate plan of care proposes that the children move to France to be cared
    for by a maternal aunt and uncle.  The report of the French
Bureau de
    laide sociale à lenfance
, which was forwarded to International Social
    Services Canada, does not recommend this alternate plan of care, having regard
    to the lack of support the proposed care givers would offer to the children
    respecting their removal from parental care. The CCAS also opposes this
    alternate plan of care having regard, among other things, to the emotional
    attachment of the two youngest children to their present foster environment, as
    well as the differences in language and culture the children would encounter.
    We agree that the proposed alternate plan of care is not in the best interests
    of the children.

Disposition

[20]

For
    the reasons given, the appeal is dismissed.

K.M. Weiler J.A.

E.A. Cronk J.A.

Sarah Pepall J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Energy
    Fundamentals Group Inc. v. Veresen Inc., 2015 ONCA 514

DATE: 20150708

DOCKET: C60196

Simmons, Epstein and Pardu JJ.A.

BETWEEN

Energy Fundamentals Group Inc.

Applicant

(Respondent)

and

Veresen Inc.

Respondent

(Appellant)

Mark A. Gelowitz and Eric Morgan, for the appellant

Orestes Pasparakis, Rahool P. Agarwal, and Stephen
    Taylor, for the respondent

Heard: May 27, 2015

On appeal from the order of Justice Michael A. Penny of
    the Superior Court of Justice, dated February 26, 2015, with reasons reported
    at 2015 ONSC 692.

Pardu J.A.:

[1]

When can a court imply terms into a commercial contract, terms upon
    which the parties have not expressly agreed? Veresen Inc. appeals from the
    decision of an application judge implying a contractual obligation on its part
    to disclose information to enable Energy Fundamentals Group Inc. (EFG) to
    determine whether to exercise an option to acquire up to 20% of a limited
    partnership, the Jordan Cove Energy Project.

[2]

EFG, an investment bank, introduced Veresen to the project, the
    development of a liquid natural gas terminal on the coast of Oregon.

[3]

Between April and July 2005, EFG provided investment banking services
    pursuant to a non-binding letter agreement dated April 1, 2005 documenting
    the parties understanding that:

(a) the Jordan Cove development offered an attractive
    investment opportunity, subject to our collective due diligence review of the
    project;

(b) the nature of [the] proposal is to work with [Veresen]
    through to project commissioning on a basis that aligns EFGs and [Veresens]
    respective interests and objectives;

(c) EFG would offer certain services and, in exchange, EFG
    would be compensated with a right to invest in the Project; and

(d) the parties would continue to work together to develop an
    arrangement which fits both parties [sic] mutual objectives.

[4]

Veresen completed its acquisition of the project and on July 12, 2005
    executed a limited partnership agreement, (LPA) through which it controlled
    the project.

[5]

Two weeks later, Veresen and EFG executed a two-and-a-half page letter
    agreement. The letter agreement was not comprehensive and reference had to be
    made to the LPA to understand the scope of the letter agreement.

[6]

Under the letter agreement, EFG was to provide assistance to Veresens
    exercise of due diligence in development of the project and financial model
    development. The letter agreement expressly stated that the parties were to
    work together to obtain financing for the project.

[7]

The letter contemplated a continuing relationship. The letter agreement
    gave EFG an option to acquire up to a 20% interest in the project, contingent
    on successful financing. The letter agreement expressly recognized that EFGs
    compensation was an opportunity to realize value over time related to the
    successful development of the Project through the investment of capital into
    the Project.

[8]

In order to exercise the option, EFG had to pay a proportionate share of
    all development equity contributed by Veresen, plus a return on Veresens
    development equity, as that return was defined in the LPA. If EFG became a
    partner, it would also be obliged to pay a proportionate share of future
    project costs. All told, EFG would be required to contribute several hundred
    million dollars in order to exercise the option.

[9]

The letter agreement expressly provides that Veresen shall assign to
    EFG an interest in the project pursuant to the terms of the [LPA] Limited
    Partnership agreement.

[10]

The
    LPA expressly provides for the reasonable disclosure of confidential
    information to prospective transferees:

any Partner may disclose Confidential Information to the extent
    reasonably necessary, to  prospective transferees of such Partners interests
    in the Partnership as a Partner thereof; provided however that such Person or
    Persons shall be informed at the time of such disclosure of its confidential
    nature and provided with the confidentiality terms of this Agreement, and that
    such Person or Persons shall first agree in writing to comply with and be bound
    by all the terms and conditions of this Section 13.2.

[11]

As
    Veresens financial advisor in 2005, EFG was at that time privy to confidential
    information about the project. This financial information was provided to EFG
    under the terms of a 2005 confidentiality agreement that seems to have expired.
    An EFG representative was also on the board of the general partner, but this
    position was terminated when EFG signaled an intention to explore exercise of
    the option and this litigation resulted.

[12]

Due
    to fluctuations in the price of natural gas, the type of facility that would be
    built by Veresen changed from an LNG importation facility to a LNG export
    facility. Before the application judge, Veresen maintained that this change was
    so drastic that the original option no longer applied, since an export terminal
    was essentially different in nature from an import terminal.

[13]

In
    the negotiations that preceded this litigation, Veresen repeatedly told EFG
    that the option was out of the money or severely underwater  in other
    words, Veresen represented to EFG that the cost of exercising the option would
    far outweigh the economic benefit of doing so. Despite making these express
    representations, Veresen refused to provide EFG with the documentation to
    verify either the pricing of the option or its likely economic value.

Application judges decision

[14]

The
    application judge rejected Veresens argument that the option no longer existed
    because the originally contemplated LNG import facility had been changed into
    an LNG export operation. No appeal is taken from that finding.

[15]

The
    application judge ordered Veresen to provide sufficient information to enable
    EFG:

(i)      to confirm Veresens calculation of the Option
    exercise price (the price information); and

(ii)      to make a reasonable determination of what an equity
    stake of up to 20% in the Project is currently worth (the value information) .

[16]

Veresen
    agreed before the application judge that it would provide the price information,
    but argues on appeal that it is not legally obliged to provide either the value
    or the price information.

[17]

The
    application judge correctly articulated the test for determining whether to
    imply terms in a contract and concluded that the option right would be illusory
    without the implied terms. The application judge noted that terms may be
    implied where necessary to give business efficacy to a contract, or where the
    terms were such that the parties would have considered too obvious to need
    express inclusion, citing
M.J.B. Enterprises Ltd. v. Defence Construction
    (1951) Ltd.,
[1999] 1 S.C.R. 619. He found that it was clear beyond
    peradventure that a potential 20% investor in the project would require access
    to financial documents before making an investment that could amount to several
    hundred million dollars. In the application judges opinion, the obligation to
    disclose the valuation information was a necessary incident to the existence
    of the Option right itself as, without it, the Option right is really no right
    at all.

Veresens argument

[18]

Veresen
    says that the application judge should not have implied terms requiring value
    and price disclosure. These were sophisticated parties; EFG chose not to bargain
    for a contractual right to disclosure even though it had done so in another
    context when it wanted that right. Implication of these terms rewrites and
    improves the contract for EFGs benefit. Veresen submits that the context here is
    different from one where a vendor is wooing a prospective buyer, and anxious to
    entice the prospect with a promise of disclosure.

[19]

Veresen
    argues that the application judge did not give sufficient weight to the
    evidence of a Veresen executive who said the company would never have agreed to
    such undefined disclosure terms.

[20]

Veresen
    supports its position that the application judge erred in implying the term he
    did by pointing out that it has no idea what it is required to disclose. Veresen
    submits that to order reasonable disclosure when a trial may be necessary to
    define what must be disclosed and the scope of any undertaking as to
    confidentiality, goes beyond the limits of available court imposed contractual
    terms. Veresen contends that although the application judge correctly
    articulated the legal test, he refashioned the test to imply a term to which
    reasonable parties in general would have agreed, without regard for the actual
    intentions in this case.

[21]

Finally,
    Veresen submits that the application judge erred in using a good faith basis to
    imply the terms.
Bhasin v. Hrynew
, 2014 SCC 71, [2014] 3 S.C.R. 495

speaks to good faith performance of a contract, not to implication of
    terms.

[22]

If
    this court upholds the implication of the disclosure term, Veresen does not object
    to the means chosen by the application judge to implement that proviso.

EFGs arguments

[23]

EFG
    submits that it and Veresen were allied in pursuit of a common goal,
    development of the LNG project. They contemplated that they could become
    partners. EFG was intimately familiar with Veresens finances and sat on the
    board of the corporation acting as general partner of the limited partnership
    managing the LNG project. It would have been obvious to the parties that EFG
    would not have invested hundreds of millions of dollars without verifying both
    Veresens calculation of the option price and reviewing Veresens records to
    assess the value of the option.

[24]

The
    application judge was correct to conclude that the option right would have been
    illusory without the right to information, and that implication of the terms
    was necessary to give business efficacy to the letter agreement. The
    application judge concluded on the whole of the evidence that the parties must
    have intended that EFG would have the right to this disclosure. There is no
    suggestion on the evidence that anyone other than EFG would become a limited
    partner.

[25]

The
    application judge did not rely on a requirement of good faith to imply the
    contractual terms, but observed the doctrinal link between the implication of
    contractual terms and good faith performance of contracts.

[26]

Although
    a proposed term may require interpretation, EFG submits that a court may
    nonetheless imply such a term where it satisfies the necessary criteria for the
    implication of terms. Interpretation of a contractual term of reasonableness
    arises in many different contexts. Veresen itself has expressly agreed to
    reasonable disclosure to prospective investors in the LPA. The LPA also
    provides for reasonable and just disclosure to limited partners.

[27]

The
    letter agreement does not purport to exhaustively define the relationship
    between the parties: the LPA is a necessary part of the context.

Analysis

(1)

Did the application judge err in implying the term?

[28]

The
    application judges largely factual conclusion that the right to value and
    price disclosure was necessary to give business efficacy of the agreement is
    owed deference. This flows from
Olympic Industries Inc. v. McNeil
, 86
    B.C.L.R. (2d) 273, [1993] B.C.J. No. 2565 (C.A.), at para. 31, cited more
    recently by
Moulton Contracting Ltd v. British Columbia
, 2015 BCCA 89,
    381 D.L.R. (4th) 263, at para. 56, which held that [t]he question as to what
    the parties must have intended as a matter of necessity
is a question of
    fact to be decided in the circumstances of each case
. [Emphasis added]

[29]

The issue of implication of contractual terms raises
    questions of mixed law and fact, as would interpretation of the contract, and
    the same standard of review should apply, palpable and overriding error, unless
    extricable errors of law are evident. (
Sattva Capital Corp. v. Creston Moly
    Corp. 2014 SCC 53)

[30]

As
    observed by the application judge, a contractual term may be implied on the
    basis of the presumed intentions of the parties where necessary to give
    business efficacy to the contract or where it meets the officious bystander
    test. (
M.J.B. Enterprises Ltd. v. Defence Construction (1951) Ltd.
,
    [1999] 1 S.C.R. 619).

[31]

The
    officious bystander test was most famously articulated in
Shirlaw v.
    Southern Foundries (1926) Ltd.,
[1939] 2 K.B. 206 at 227, [1939] 2 All
    E.R. 113 at 124 (C.A.):

Prima facie
that which in any contract is left to be
    implied and need not be expressed is something so obvious that it goes without
    saying. Thus, if while the parties were making their bargain, an officious
    bystander were to suggest some express provision for it in their agreement,
    they would testily suppress him with a common: Oh, of course.

[32]

The
    business efficacy test in its modern form originated in
The

Moorcock
(1889) 14 P.D. 64, [1886-90] All E.R. Rep. 530 (C.A.) at 68:

In business transactions such as this, what the law desires to
    effect by the implication is to give such business efficacy to the transaction
    as must have been intended at all events by both parties

[33]

The

Moorcock
concerned a contract between a wharf operator and a ship
    owner; the court implied a warranty that the ship could be safely moored at the
    wharf with the object of giving to the transaction such efficacy as both
    parties must have intended (p. 68, 70).

[34]

The
    business efficacy test was reviewed more recently by the Privy Council in
Attorney
    General of Belize v. Belize Telecom Ltd.
, [2009] UKPC 10, [2009] 2 All
    E.R. 1127, at para. 22:

Take, for example, the question of whether the implied term is
    "necessary to give business efficacy" to the contract. That
    formulation serves to underline two important points. The first, conveyed by
    the use of the word "business", is that in considering what the
    instrument would have meant to a reasonable person who had knowledge of the
    relevant background, one assumes the notional reader will take into account the
    practical consequences of deciding that it means one thing or the other. In the
    case of an instrument such as a commercial contract, he will consider whether a
    different construction would frustrate the apparent business purpose of the
    parties.

[35]

Implication
    of a contractual term does not require a finding that a party actually thought
    about a term or expressly agreed to it. Often terms are implied to fill gaps to
    which the parties did not turn their minds (
Belize Telecom
, para. 31).

[36]

On
    the other hand, a court will not imply a term that contradicts the express
    language of the contract, or is unreasonable:
G. Ford Homes Ltd. v. Draft
    Masonry (York) Co. Ltd.
(1984), 43 O.R. (2d) 401 (C.A.).

[37]

The
    conclusions drawn by the application judge were reasonably available to him on
    the evidence. Here, it is apparent that the letter agreement was not intended
    to comprehensively define the relationship between the parties. In a commercial
    setting, there may be contracts where the parties to a contract may have been
    content to express only the most important terms of their agreement, leaving
    the remaining details to be understood (H.G. Beale, ed.,
Chitty on
    Contracts
, 31st ed. (London UK: Sweet & Maxwell, 2012) vol. 1 at
    13-002).

[38]

The
    application judge did not err in failing to give the evidence of the Veresen
    executive the conclusive weight urged upon this court on appeal. The subjective
    evidence of a party, often given years later, as to whether or not it would
    have agreed to the proposed implied term is of little value, amounting to a
    barren argument over how the actual parties would have reacted to the proposed
    amendment. (
Belize Telecom
, at para. 25) The analysis of whether to
    imply a term must be done on an objective basis, but having regard to the
    specific parties and specific contractual context.

[39]

The
    application judges conclusions that the option was illusory unless a right to
    disclosure was implied, and that an implied term of disclosure was necessary to
    give business efficacy to the agreement are not tainted by reviewable error.

[40]

In
    this context, the implication of the terms requiring disclosure is not rendered
    unnecessary because EFG could blindly exercise the option without knowing
    whether it would make economic sense to do so. Such an interpretation would
    frustrate the business purpose of the agreements. As Lord Hoffman observed in
Belize
    Telecom
, at para. 23:

The danger lies, however in detaching the phrase necessary to
    give business efficacy from the basic process of construction of the
    instrument.
It is frequently the case that a contract may work perfectly
    well in the sense that both parties can perform their express obligations, but
    the consequences would contradict what a reasonable person would understand the
    contract to mean
. [Emphasis added]

(2)

Did the application judge depart from the correct test by determining
    the intentions of reasonable parties rather than the actual parties?

[41]

Veresens
    argument that the application judge departed from the correct test for implication
    of a term (which requires analysis of the actual intentions of the parties) and
    instead used a test of what reasonable parties would have agreed is based on
    para. 85 of his reasons:

If Veresen was looking for a 20% equity partner in the Project,
    it is clear beyond peradventure that it would have to provide access to
    confidential financial information about the Project. No one would ever invest
    several hundred million dollars in this Project without performing detailed due
    diligence on the value of the stake in the Project being acquired.

[42]

Veresen
    relies on para. 29 of
M.J.B Enterprises Ltd
., where Iacobucci J. said:

What is important in both formulations [the business efficacy
    test and the officious bystander test] is a focus on the intentions of the
actual
parties. A court, when dealing with terms implied in fact, must be careful
    not to slide into determining the intentions of reasonable parties [Emphasis
    in the original]

[43]

As
    observed in John D. McCamus,
The Law of Contracts
, 2nd ed. (Toronto: Irwin
    Law, 2012), at 781, reasonableness is an inescapable part of determining
    whether to imply a contractual term:

Thus, it is plainly the case that the implied terms must
    themselves be reasonable. One would not expect a court to imply terms into an
    agreement that it considered to be unreasonable. Further, keeping in mind that
    the implied in fact term rests on the presumed intentions of the parties,
    courts quite understandably presume intentions of the parties that are
    reasonable. In other words, in attributing to the parties hypothetical
    intentions as to what they would have agreed to if the matter had been raised
    at the time of contracting, courts assume that the parties would behave
    reasonably and would agree to a reasonable term. Indeed, in the absence of actual
    but unexpressed intentions it is inescapable that courts would apply a
    reasonable intentions standard. In other words, although necessity appears to
    be the threshold that must be met before engaging in the exercise of implying
    the term, the formulation of the term to be implied is very much an exercise
    that rests on a concept of reasonableness. At the same time, however, the
    implied term is tailored to the needs of the actual transaction of the actual parties
    rather than to some hypothetical reasonable transaction; accordingly, to the extent
    that relevant actual intentions of the parties are manifest in the transaction,
    they must form a basis for the implied term.

[44]

The
    courts warning in
M.J. B. Enterprises
about the need to be careful
    not to slide into the intentions of reasonable parties, mandated an analysis
    rooted in the actual relationship between the parties and the specific
    contractual context, rather than a detour into an abstract analysis of what in
    general, a reasonable person might have agreed. In
M.J.B. Enterprises
itself
    the court went on to assess the reasonableness of the proposed implied term in
    the specific context, but also relied on the general reasonableness of such a
    term, saying, at para. 30, I find it difficult to accept that the appellant,
    or any of the other contractors, would have submitted a tender unless it was
    understood by all that only a compliant tender would be accepted.

[45]

In
    my view the application judge did not depart from the proper test cited by him
    in the immediately preceding paragraph of his reasons. His analysis is in no
    way abstracted from an analysis of the specific relationship between these
    parties.

[46]

The
    finding that no reasonable person would have embarked on an exercise of the
    option without disclosure, supports a finding of the necessity of the implied
    term for purposes of business efficacy.

(3)

Did the application judge err by confounding the requirement of good
    faith performance of a contract with the test for implying contractual terms?

[47]

In
    my view, the application judges references to good faith do not undermine his
    earlier factual conclusions as to necessity and business efficacy.

[48]

As
    he indicated, in
Bhasin
, the court observed:

The implication of terms plays a functionally similar role in
    common law contract law to the doctrine of good faith in civil law
    jurisdictions
by filling in gaps in the written agreement of the parties
:
Chitty on Contracts,
at para. 1-051 [emphasis added].

[49]

Reference
    to this common doctrinal underpinning, after concluding that implication of the
    term was necessary to give business efficacy to the contract, does not amount
    to error. As explained in Swan & Adamski,
Canadian Contract Law
, 3rd
    ed. (Markham: LexisNexis, 2012) at para.8, p.113:

Like custom and the device of the implied term or the imposed
    or supplied term to fill a gap in the agreement, good faith is a device for
    supplementing the terms of the contract to deal with aspects of the relation
    that have not been specifically dealt with by the parties.

[50]

Given
    Veresens agreement before the application judge that it would provide the
    pricing information, there is no basis to revisit that conclusion on appeal. In
    any event, the same analysis would compel implication of a term requiring
    disclosure of pricing information. No one could have reasonably contemplated
    that EFG would have to blindly accept Veresens calculation of the option
    price.

Disposition

[51]

For
    these reasons, the appeal is dismissed, with costs to EFG in the agreed sum of
    $50,000, inclusive of disbursements and applicable taxes.

Released: July 8, 2015

(GE)

G. Pardu J.A.

I agree Janet Simmons J.A.

I agree Gloria Epstein J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Foley (Re), 2015
    ONCA 507

DATE: 20150706

DOCKET: C58300

Doherty, Juriansz and Huscroft JJ.A.

In the Estate of Vera
    Eileen Pearl Foley, Deceased, and in the Matter of the Property of Edward Walter
    Foley under Power of Attorney, and in the Estate of Edward Walter Foley,
    Deceased

BETWEEN

Donald Edward Foley

Plaintiff (Appellant)

and

Dorothy Eileen McIntyre

Defendant (Respondent)

Gregory M. Sidlofsky and B. Donovan, for the appellant

Barry L. Evans, for the respondent

Heard: January 12, 2015

On appeal from the judgment of Justice Anne Mullins of
    the Superior Court of Justice, dated January 9, 2014, with reasons reported at
    2014 ONSC 194.

COSTS ENDORSEMENT

[1]

Following the release of the court's decision on May 28, 2015, the
    parties filed written submissions regarding costs. Costs in favour of the
    successful respondent are fixed in the amount of $20,000.00 all inclusive.

Doherty
    J.A.

R.G.
    Juriansz J.A.

Grant
    Huscroft J.A.