COURT OF APPEAL FOR ONTARIO

CITATION: Winmill v. Woodstock (Police Services Board), 2017
    ONCA 962

DATE: 20171207

DOCKET: C63796

Feldman, MacPherson and Huscroft JJ.A.

BETWEEN

Robert Winmill

Plaintiff (Appellant)

and

Woodstock Police Services Board, Police Constable
    Dopf, Police Constable Campbell, Police Constable John Doe(s) and Constable
    Jane Doe(s)

Defendants (Respondents)

Kevin A. Egan, for the appellant

David S. Thompson, for the respondent

Heard: November 10, 2017

On appeal from the order of Justice A.K. Mitchell of the Superior
    Court of Justice, dated June 14, 2017.

Limitations Period - appeal of decision granting
    defendant's motion for an order dismissing plaintiff's claim for battery as
    statute-barred - plaintiff argues discoverability, that he was unable to start
    a claim until he was released from custody, and that he was suffering from
    depression.

MacPherson J.A.:

A.

introduction

[1]

The appellant, Robert Winmill, appeals from the decision of Mitchell J.
    of the Superior Court of Justice dismissing, on a motion, the appellants claim
    for battery against the respondents Woodstock Police Service and various police
    officers as statute barred by virtue of s.4 of the
Limitations Act, 2002
,
    S.O. 2002, c.24, Sched. B (
LA
).

[2]

The central issue is when the appellant discovered his potential claim
    in battery against the respondents. Resolution of this issue focuses on the
    interpretation of s. 5(1)(a)(iv) of the
LA
, and in particular on when
    the appellant knew that a legal proceeding would be an appropriate means to
    seek to remedy the alleged battery against him.

B.

facts

(1)

The parties and events

[3]

On the evening of June 1, 2014, there was an altercation at the
    appellants home between the appellant and one of his sons. The appellants
    wife called the police.

[4]

According to the appellants Statement of Claim, several officers from
    the Woodstock Police Service arrived at his home. By the time of their arrival,
    he was alone in the home. According to the appellant, Constables Dopf and
    Campbell entered the home and confronted him in the living room. Constable Dopf
    initiated unnecessary and aggressive physical contact with him. Constable
    Campbell joined in. The two constables forced the appellant to the ground and
    struck the appellant in the back and head with knee strikes and punches. In the
    process, the constables handcuffed the appellant in such an aggressive manner
    that he suffered cuts and bruises to his arms.

[5]

The appellant was taken to the police station. He was charged with
    assaulting Constable Dopf and resisting arrest. He was not charged with any
    offence relating to the altercation with his son.

[6]

On February 17, 2016, the appellant was acquitted of both charges by
    Graham J. of the Ontario Court of Justice. The trial judge concluded:

I cannot state with a requisite degree of certainty that Robert
    assaulted Constable Dopf at that moment. It is possible as it would explain the
    robust police reaction. However, it is equally plausible that Dopf pushed
    Robert with a fair degree of force and that the defendant reacted to an
    unlawful assault by actively trying to disengage from police. There is no
    suggestion he kneed or punched the officers.

In any event, during the subsequent interaction I am not certain
    that Robert was lawfully under arrest. It is possible that police advised him
    during the course of that struggle. It is equally likely that he was arrested
    inside the police cruiser once he had been secured. The photographs show
    injuries to the defendant, but they do not assist me in resolving the matter.

Based on the evidence that I do accept I am left with a
    reasonable doubt with respect to both charges. The defendant is found not
    guilty.

[7]

On June 2, 2016, the appellant filed a Notice of Action against the
    respondents, signalling that he would be seeking damages for negligent
    investigation and assault. This was two years and one day after the alleged
    battery had taken place.

[8]

On June 22, 2016, the appellant filed a Statement of Claim sounding in
    the tort of battery, abuse of authority as police officers, and negligence in
    the discharge of police duties.

[9]

On September 16, 2016, the respondents filed a Notice of Motion seeking
    to dismiss the action because the relevant limitation period had expired. The
    motion was not argued in the autumn of 2016.

[10]

On
    February 24, 2017, Gorman J. of the Superior Court of Justice made a consent
    order permitting the appellant to make factual allegations to support a claim
    for negligent investigation.

[11]

On
    March 24, 2017, the respondents filed an Amended Amended Notice of Motion
    seeking an order that [t]he limitation period for the Plaintiffs claim for
    damages arising from assault or battery has expired. The respondents did not
    say that the appellants claim grounded in negligent investigation was statute
    barred.

(2)

The motion

[12]

The
    respondents motion was argued on April 3, 2017. The appellant resisted a
    limitation period expiration date of June 1, 2016 (two years after the alleged
    battery) on three bases  discoverability; inability to commence an action
    because he was in custody and/or the courthouse was closed on June 1, 2016; and
    incapacity to commence a proceeding because of a physical, mental or
    psychological condition.

[13]

The
    motion judge rejected the appellants arguments. She concluded:

The defendants motion is granted and the plaintiffs claim for
    battery is dismissed. The limitation period for the tort of negligent
    investigation began to run on February 17, 2016 (the date Mr. Winmill was found
    not guilty) and, therefore, the plaintiffs claim for negligent investigation
    is unaffected and may continue.

[14]

The
    appellant appeals from the motion judges decision.

C.

issue

[15]

The
    sole issue on the appeal is: did the motion judge err by concluding that the
    appellants claim in battery against the respondents was not made inside the
    two year limitation period prescribed by s. 4 of the
LA
?

D.

analysis

[16]

The
    analysis of the limitation period in this case must take place within the
    confines of ss. 4 and 5(1) of the
LA
, which provide:

4        Unless
    this Act provides otherwise, a proceeding shall not be commenced in respect of
    a claim after the second anniversary of the day on which the claim was
    discovered.

5(1)    A claim is discovered on the earlier of,

(a)     the day on which the person with the claim
    first knew,

(i)      that the injury, loss or damage had
    occurred,

(ii)      that
    the injury, loss or damage was caused by or contributed to by an act or
    omission,

(iii)     that
    the act or omission was that of the person against whom the claim is made, and

(iv)     that,
having regard to the nature of the injury, loss or damage, a proceeding
    would be an appropriate means to seek to remedy it
. [Emphasis added.]

[17]

I
    begin with a structural point. In a single case where a plaintiff alleges
    different torts, it is possible and permissible for different limitation
    periods to apply to the different torts: see
West v. Ontario
, 2015
    ONCA 147, at paras. 2-3.

[18]

Turning
    to s. 5(1)(a) of the
LA
, in this case there is no issue with respect
    to the first three of the four factors set out in this clause. The appellant
    knew that he had been injured on June 1, 2014, that the injury was caused by
    physical blows to his body, and that at least some of the respondents
    administered those blows.

[19]

The
    crucial issue is the fourth factor: did the appellant know on June 1, 2016 that
    a legal proceeding would be an appropriate means to seek to remedy the injuries
    caused by the alleged battery committed against him?

[20]

The
    motion judge answered this question in the affirmative. She reasoned:

It is clear from the evidence the plaintiff had knowledge that
    litigation was available to him as a remedy for the damages he had suffered at
    the hands of the police. Whether and to what extent he may have been found
    criminally responsible for the offences with which he had been charged was in
    no way determinative of whether or not he had been the subject of excessive
    force and assaulted by police.

The plaintiff admitted he knew litigation was an option and by
    extension he is therefore deemed to know it was appropriate to sue the
    Woodstock Police Service for redress of his injuries suffered on June 1, 2014.

[21]

In
    assessing whether the motion judge erred in reaching this conclusion, I begin
    with three contextual points about subclause (iv) of s. 5(1)(a) of the
LA
.

[22]

First,
    the word appropriate means legally appropriate. As explained by Sharpe J.A.
    in
Markel Insurance Company of Canada v. ING Insurance Company of Canada
,
    2012 ONCA 218, at para. 34:

In my view, when s. 5(1)(a)(iv) states that a claim is
    discovered only when having regard to the nature of the injury, loss or
    damage, a proceeding would be an appropriate means to seek to remedy it, the
    word appropriate must mean
legally appropriate
. To give
    appropriate an evaluative gloss, allowing a party to delay the commencement
    of proceedings for some tactical or other reason beyond two years from the date
    the claim is fully ripened and requiring the court to assess to tone and tenor
    of communications in search of a clear denial would, in my opinion, inject an
    unacceptable element of uncertainty into the law of limitation of actions.
    [Emphasis in original.]

[23]

Second,
    this does not mean that determining whether a limitation period applies
    involves pulling two simple levers  date of injury and date of initiation of
    legal proceeding  and seeing whether the result is inside or outside the
    limitation period prescribed by the relevant statute. On the contrary, other
    important factors can come into play in the analysis. As Laskin J.A. cautioned
    in
407 ETR Concession Company Limited v. Day
, 2016 ONCA 709 (
407
    ETR
), at paras. 33-34:

The appropriateness of bringing an action was not an element of
    the former limitations statute or the common law discoverability rule. This
    added element can have the effect  as it does in this case  of postponing the
    start date of the two-year limitation period beyond the date when a plaintiff
    knows it has incurred a loss because of the defendants actions.

Also, when an action is appropriate depends on the
    specific factual or statutory setting of each individual case
: see
Brown
    v. Baum
, 2016 ONCA 325, 397 D.L.R. (4th) 161, at para. 21. Case law
    applying s. 5(1)(a)(iv) of the
Limitations Act, 2002
is of
    limited assistance because each case will turn on its own facts. [Emphasis
    added.]

[24]

Third,
    within the rubric of the specific factual or statutory setting of each
    individual case, s. 5(1)(b) of the
LA
requires that attention be paid
    to the abilities and circumstances of the person with the claim: see
Novak
    v. Bond
, [1999] 1 S.C.R. 808 (
Novak
), at para. 85; and
407
    ETR
, at paras. 44-46.

[25]

Against
    this background of general principles, I turn to the motion judges conclusion
    that the appellants battery claim was outside (by one day) the two year
    limitation period prescribed by s. 4 of the
LA
. With respect, I think
    that the motion judge erred, essentially for three reasons.

[26]

First,
    the appellants negligent investigation claim is proceeding. The parties agree
    that the discoverability date for this claim is February 17, 2016, the day the
    appellant was acquitted on the criminal charges against him. Factually, the
    negligent investigation claim covers almost precisely the same parties and
    events as the battery claim. There was virtually no investigation in this case.
    The police were called, they arrived and immediately entered the appellants
    home, and some kind of altercation quickly unfolded.

[27]

In
    my view, the appellants Amended Statement of Claim shows how inextricably
    intertwined are the two alleged torts:

14 e.  The
    Defendant officers were present and knew or ought to have known that the
    Plaintiff did not commit an assault against any police officer. There was no
    reasonable cause for the Defendant officers to arrest or charge the Plaintiff
    with assault of a police officer.

14 f.   As the
    Plaintiff stood motionless, he was pushed violently in the chest by the
    Defendant Dopf. He was then thrown to the floor. Knee strikes and punches were
    then delivered by both the Defendants Dopf and Campbell. He was handcuffed,
    removed from the house and taken to the police station.

[28]

Second,
    I agree with the appellant that, in the specific factual setting of this case (
407
    ETR
), and bearing in mind the circumstances of the person with the claim (
Novak
),
    it made sense for him to postpose deciding whether to make a battery claim
    against the respondents until his criminal charges for assault and resisting
    arrest were resolved. The criminal charges of assault and resisting arrest
    against the appellant and his tort claim of battery against the respondents
    are, in reality, two sides of the same coin or mirror images of each other.

[29]

In
    general terms, McLachlin J. said this in
Novak
, at para. 85:

Litigation is never a process to be embarked upon casually and
    sometimes a plaintiffs individual circumstances and interests may mean that he
    or she cannot reasonably bring an action at the time it first materializes.
This
    approach makes good policy sense. To force a plaintiff to sue without having
    regard to his or her own circumstances may be unfair to the plaintiff and may
    also disserve the defendant by forcing him or her to meet an action pressed
    into court prematurely
. [Emphasis added, citation omitted.]

[30]

In
    my view, a good specific example of the operation of this general point is
Brown
    v. Baum
, 2016 ONCA 325, a case involving the determination of a limitation
    period where a patient contemplated suing her doctor following a poor surgical
    result, but did not do so until after the doctor made subsequent efforts to
    correct the damage. In upholding the motion judges decision to extend the
    commencement of the limitation period to the date of Ms. Browns last
    ameliorative surgery by Dr. Baum (para. 5), Feldman J.A. said, at para. 24:

[The motion judge] was entitled to find that Ms. Brown did not
    know that it was appropriate to sue Dr. Baum until after the last surgery he
    performed to try to correct the complications and improve the outcome of the
    original surgery. As the motion judge observed, it is not simply an ongoing
    treatment relationship that will prevent the discovery of the claim under s. 5.
    In this case, it was the fact that the doctor was engaging in good faith
    efforts to remediate the damage and improve the outcome of the initial surgery.
    This could have avoided the need to sue.

[31]

In
    a similar vein, it strikes me as obvious that the verdict in the appellants
    criminal trial, especially on the assault charge, would be a crucial, bordering
    on determinative, factor in the appellants calculation of whether to proceed
    with a civil action grounded in a battery claim against the respondents.

[32]

Third,
    and overlapping with the second reason, there is a case almost directly on
    point suggesting that the appellant was justified in waiting for the verdict in
    his criminal trial before commencing a civil claim against the respondents. In
Chimienti
    v. Windsor (City)
, 2011 ONCA 16, the plaintiff was charged with assault
    following a tavern brawl. The charge was dropped. The plaintiff commenced a
    civil action with claims of negligent and malicious investigation. The motion
    judge dismissed the action on the basis of the relevant statutory limitation
    period. This court, although dismissing the appeal on other grounds, disagreed
    with the motion judges analysis of the discoverability issue. In doing so, the
    court said, at para. 15:

[T]here is something of a logical inconsistency in asking a
    civil court to rule on the propriety of a criminal prosecution before the
    criminal court has had the opportunity to assess the merits of the underlying
    charge.

[33]

In
    my view, this passage is particularly applicable to this appeal. As I said
    earlier, the criminal charges of assault and resisting arrest against the
    appellant and his tort claim of battery against the respondents are very close
    to being two sides of the same coin or mirror images of each other.
    Accordingly, it made sense for the appellant to focus on his criminal charges
    and deal with those before making a final decision about a civil action against
    the respondents.

[34]

For
    these reasons, I am of the view that the discoverability date for the
    appellants battery claim was the same as the discoverability date for his
    negligent investigation claim  February 17, 2016, the date of his acquittal on
    the criminal charges  and, accordingly, his Notice of Action on June 2, 2016
    brought both claims within s. 4 of the
LA
.

E.

disposition

[35]

I
    would allow the appeal, set aside the order of the motion judge, and permit the
    appellants battery claim against the respondents to proceed to trial.

[36]

The
    appellant is entitled to his costs of the appeal which I would fix at $5,000. I
    would set aside the motion judges costs award in favour of the respondents and
    replace it with an award of $8,948.56 in favour of the appellant. Both amounts
    are inclusive of HST and disbursements.

J. C. MacPherson J.A.

I agree. K. Feldman
    J.A.

Huscroft J.A. (Dissenting):

[37]

I
    have had the benefit of reading the draft reasons prepared by my colleague,
    MacPherson J.A. With respect, I do not agree with his analysis and would
    dismiss the appeal for the reasons that follow.

[38]

This
    is a straightforward case. On June 1, 2014, the appellant knew that he had
    suffered an injury, knew how the injury was caused, knew who he alleged had
    caused his injury, and knew that a legal proceeding would be an appropriate
    means to seek redress. He failed to bring his claim by June 1, 2016, and in my
    view his claim is now barred by operation of the
Limitation Act, 2002,
S.O. 2002, c. 24, Sched. B.

[39]

My
    colleague concludes that the limitation period did not begin to run from the
    date of the alleged battery, but instead almost 21 months later  February 17,
    2016, when the appellant was acquitted of assaulting the police officers he
    alleges were responsible for the battery. He concludes that the appellant did
    not know  and a reasonable person in the appellants position ought not have
    known  that a legal proceeding would be an appropriate means to seek to remedy
    the injuries caused by the alleged battery within the meaning of s. 5(1)(a)(iv)
    of the Act until this much later date.

[40]

In
    my view, the decision of this court in
Markel Insurance Company of Canada v.
    ING Insurance Company
, 2012 ONCA 218, 109 O.R. (3d) 652, is key to the
    correct outcome in this case. In that case, Sharpe J.A. explained that
    appropriate under s. 5(1)(a)(iv) of the Act must mean legally appropriate,
    and, at para. 34, admonished against giving the term a broad meaning:

To give appropriate an evaluative gloss, allowing a party to
    delay the commencement of proceedings for some tactical or other reason beyond
    two years from the date the claim is fully ripened  would, in my opinion,
    inject an unacceptable element of uncertainty into the law of limitation of
    actions.

[41]

My
    colleague acknowledges the authority of
Markel
, but in my view
    undermines it by emphasizing the need to attend to the factual circumstances of
    individual cases, drawing on this courts subsequent decisions in
407 ETR
    Concession Co. v. Day
, 2016 ONCA 709, 133 O.R. (3d) 762, and
Brown v.
    Baum
, 2016 ONCA 325, 397 D.L.R. (4th) 161. But both of these cases are
    clearly distinguishable. An action in
407 ETR
was not appropriate at
    the time of the injury because an alternative administrative means of settling
    the dispute had not been completed. An action in
Brown
was not
    appropriate at the time of the injury because the defendant surgeon was
    providing further treatment in an attempt to rectify the harm he was alleged to
    have caused in the initial surgery.

[42]

There
    was no alternative means of resolving the appellants allegations in this case,
    nor were the defendants in a position to rectify the harm they were alleged to
    have caused. My colleague considers it obvious that the appellant should await
    the outcome of the criminal proceedings against him, relying on dicta from
Chimienti
    v. Windsor (City)
, 2011 ONCA 16, 330 D.L.R. (4th) 148. But that case, too,
    is distinguishable, among other reasons because it concerned claims of
    negligent and malicious investigation  claims that depended on the completion
    of the relevant criminal proceedings on which they were based.

[43]

The
    claim of battery in this case did not. And although the appellant also seeks to
    advance a claim for negligent investigation, it is a separate tort to which a
    separate limitation period applies:
West v. Ontario
, 2015 ONCA 147, at
    paras. 2-3. A claimant cannot delay the start of a limitation period for one
    tort claim by tying it to another tort claim with a later limitation date, even
    where the claims arise out of common circumstances.

[44]

Nor
    can a claimant delay the start of a limitation period for an intentional tort
    in order to await the outcome of related criminal proceedings. This approach
    has been followed by Ontario trial courts in many cases. For example, in
Brown
    v. Becks
, 2017 ONSC 4218, the court held that a limitation period involving
    various claims against police including battery during an arrest ran from the
    date of the plaintiffs arrest, not the date of his acquittal on criminal
    charges; in
Boyce v. Toronto (City) Police Services Board
, 2011 ONSC
    54, affd 2012 ONCA 230, the limitation period in a civil action against police
    ran from the date of the battery rather than the officers conviction on
    assault charges. See also
EBF v. HMQ in Right of Ontario, et. al
, 2013
    ONSC 2581, and
Wong v. Toronto Police Services Board
, 2009 CarswellOnt
    7412 (Ont. S.C.). Similarly, in
Kolosov v. Lowes Companies Inc.
, 2016
    ONCA 973, 34 C.C.L.T. (4th) 177, this court affirmed the trial judges decision
    that a limitation period involving intentional tortious conduct alleged to have
    occurred on arrest ran from the date of the arrest rather than the date of the
    withdrawal of the criminal charges. See also
Roda v. Toronto Police
    Services Board
, 2016 ONSC 743, affd 2017 ONCA 768. My colleague offers no
    reason to depart from this body of law.

[45]

In
    this case the appellant decided, for tactical reasons, not to bring his battery
    action until after the criminal proceedings against him had concluded. My
    colleague acknowledges as much in stating that it made sense for [the
    appellant] to postpone deciding whether to make a battery claim against the
    respondents. That was an improvident decision, and this court has no
    discretionary power to relieve against the consequences of it, whether the
    appellants claim is a day late or year late.

[46]

In
    my view, the motion judge made no errors. The battery claim is late. The
    negligent investigation claim is not. I would dismiss the appeal.

Released: KF DEC 7 2017

Grant Huscroft J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Willowbrook Nurseries Inc. v. Royal Bank of Canada, 2017 ONCA 974

DATE: 20171212

DOCKET: C62651

Pardu, Trotter and Paciocco JJ.A.

BETWEEN

Willowbrook Nurseries Inc.

Plaintiff (Appellant)

and

Royal Bank of Canada

Defendant (Respondent)

Paul J. Pape, for the appellant

Milton A. Davis and Rob Macdonald, for the respondent

Heard: November 17, 2017

On appeal from the judgment of Justice Robert D. Reilly
    of the Superior Court of Justice, dated August 11, 2016, with reasons for
    judgment reported at 2016 ONSC 4954 and reasons for costs reported at 2016 ONSC
    6630.

Breach of contract  General organizing principle of
    good faith  Duty to provide reasonable notice of change to prevailing course
    of lending conduct  Whether bank exercised discretion in good faith  Duty to
    exercise contractual discretion in objectively reasonable manner.

Pardu J.A.:

[1]

Willowbrook Nurseries Inc. (Willowbrook) needed
    to borrow more money from its banker, Royal Bank of Canada (RBC). It needed
    more working capital because its business was growing and because it suffered a
    few business hiccups in the preceding year. RBC did not agree to immediately
    lend more money to Willowbrook and placed its accounts in Special Loans and
    Advisory Services (Special Loans).

[2]

RBCs refusal to immediately lend more money
    meant that Willowbrook could not pay its suppliers on time and had to lay off
    employees. RBC demanded more financial information from Willowbrook and
    proposed to increase banking fees and interest charges. It wanted up to date
    appraisals of the real property securing Willowbrooks debt.  It proposed to engage
    an accounting consultant to review Willowbrooks financial position, at
    Willowbrooks expense. RBC asked for cash flow projections and indicated that
    an appropriate temporary overdraft accommodation limit will be established
    upon our review and acceptance of your cash flow projections.

[3]

Willowbrook brought an action against RBC for
    breach of its obligation to perform the lending agreement in good faith. Willowbrook
    argued at trial that RBCs refusal to lend new money and its decision to subject
    Willowbrook to Special Loans treatment amounted to a change in the prevailing
    course of lending conduct and required reasonable notice. It argued at trial
    that the Special Loans treatment amounted to a
de facto
demand for payment without notice. Willowbrooks action was
    dismissed and it appeals to this court.

[4]

I would dismiss the appeal for the reasons that
    follow.

Factual background

[5]

RBC began lending to Willowbrook through a line
    of credit, demand loan, various mortgages, and a corporate credit card in
    January 2005. Since the plant nursery business is seasonal, Willowbrook always
    needed an infusion of working capital in the winter in order to produce plants
    that would be sold in the spring and summer. To satisfy Willowbrooks seasonal financing
    needs, RBC would agree to a temporary accommodation request (TAR) that
    allowed Willowbrook to temporarily exceed its $2.75 million line of credit each
    winter. The overdraft amount was set by the parties mutual agreement each fall
    or winter and would typically be paid down in the following spring or early
    summer.

[6]

However, through the spring and summer of 2008,
    Willowbrook did not fully repay the $1.25 million worth of TAR that RBC
    extended in the winter of 2007, despite three extensions of time to do so
    (2007 TAR). By December 2008, $1.029 million of the 2007 TAR was still outstanding.

[7]

Nonetheless, Willowbrook submitted an additional
    $1.2 million TAR following the completion of its fiscal 2008 financial
    statements on October 14, 2008 (2008 TAR) along with a debt restructuring and
    separate $500,000 term loan request. Approval of these requests would have
    meant that RBC would be lending, in total, $500,000 more than ever before to
    Willowbrook.

[8]

Willowbrook was approaching the limits of its
    agreed upon credit, had no immediate prospect of significant revenue, and faced
    the expenses of planting for a new season.

[9]

The local RBC account manager supported
    Willowbrooks requests and submitted them, along with Willowbrooks recently
    completed 2008 financial statements, to RBCs risk management group on November
    21, 2008. On November 26, 2008, a RBC risk manager refused Willowbrooks 2008 TAR,
    restructuring request, and term loan request. Instead, the risk manager
    transferred Willowbrooks account into Special Loans on December 5, 2008
    following a meeting with Willowbrook. The local account manager was replaced.

[10]

RBC outlined its concerns and requirements by letter
    dated December 8, 2008. It expressed concern about Willowbrooks working
    capital, liquidity, and increased inventory levels. RBC noted the outstanding 2007
    TAR and Willowbrooks forecast that it would need $500,000 more to carry it
    through to April of the following year.

[11]

RBC said it would continue to provide interim
    financing to allow Willowbrook to revise its business plan and to address the
    banks concerns. It demanded detailed financial information and up to date
    appraisals of real property securing Willowbrooks debt. Overdrafts in excess
    of agreed upon limits would not be permitted. Bank fees and interest charges
    were forecast to increase. The new RBC account manager had to approve payment
    of all cheques.

[12]

Willowbrook scrambled to provide the requested
    information, while dealing at the same time with the terminal illness of one of
    the principals. On January 12, 2009, Willowbrooks accountant wrote to RBC,
    stating we feel our client should not remain in special loans under your
    proposed terms. We do not feel that our clients financial situation warrants
    this. If our client cannot be returned to normal credit or if the proposed
    terms cannot be amended, then on behalf of our client, we respectfully request
    a reasonable time period to seek alternative financing. The accountant asked RBC
    for 30 days to seek other financing.

[13]

RBC was not prepared to remove Willowbrook from
    Special Loans but agreed to Willowbrooks request for time to find alternative
    financing and provided 60 days to do so. Ultimately, all of Willowbrooks debt
    to RBC was discharged upon refinancing by another bank in April 2009.

[14]

Willowbrook was a profitable business throughout
    the time it banked with RBC. It never defaulted on any of its loans.

Trial judges
    findings

[15]

Willowbrook sued RBC and alleged that RBC exercised
    its contractual discretion in bad faith. Willowbrook argued at trial that RBC was
    obliged to advance additional credit because it had done so in the past. Willowbrook
    also argued that placing its accounts in Special Loans amounted to a
de
    facto
demand for repayment without notice.

[16]

The trial judge rejected Willowbrooks argument
    that RBC acted in bad faith. He found that RBC gave Willowbrook reasonable time
    to make other financial arrangements. After citing
Bhasin v. Hrynew
, 2014 SCC 71, [2014] 3 S.C.R. 494
,
he noted at para. 51 of his reasons:

One might
    question the financial wisdom of RBCs decision to limit the extension of
    financial relief to Willowbrook, but I cannot conclude that in doing so RBC
    acted in bad faith. RBC was simply exercising honestly its contractual
    entitlement. This exercise was not capricious or arbitrary.

[17]

At para. 57 of his reasons, the trial judge
    concluded that RBC acted in good faith throughout, consistent with its
    contractual rights and obligations.

Issues on
    appeal

[18]

On appeal, Willowbrook submits first that the trial
    judge erred in finding that RBC did not act in bad faith on December 5, 2008
    when it restricted Willowbrooks access to credit and transferred its accounts to
    Special Loans, both without reasonable notice.

[19]

Secondly, Willowbrook argues that RBC had a duty
    to exercise its discretionary powers in an objectively reasonable manner. RBC
    was not in danger of losing its money and should not, therefore, have subjected
    Willowbrook to Special Loans treatment. Willowbrook submits the trial judge
    erred by focusing only on whether RBC acted subjectively in good faith, and not
    whether RBCs actions were objectively reasonable.

[20]

Neither party challenges the trial judges
    findings of fact.

[21]

Willowbrook relies on
Thermo King
    Corp. v. Provincial Bank of Canada
(1981),
34 O.R. (2d) 369 (C.A.), [1981] O.J. No. 3136 and submits that RBC had
    a duty to give reasonable notice of a change to the prevailing course of lending
    conduct between the parties. Willowbrook submits that there was a prevailing
    course of lending conduct with RBC; temporary overdrafts had been granted in
    the past to fund its winter working capital needs. Willowbrook alleges that
    RBCs decision to reject the 2008 TAR and place its accounts under Special
    Loans management constituted changes to the prevailing course of lending
    conduct. Willowbrook argues that RBC was required to provide reasonable notice
    before implementing either change.

[22]

Willowbrook further contends that RBCs decision
    to place its accounts under Special Loans management was objectively unreasonable.
    It submits that RBCs subjective belief that it was acting in good faith does
    not shield RBC from liability for making objectively unreasonable discretionary
    decisions.

[23]

RBC agrees that a bank has a duty to provide
    reasonable notice to a customer if the bank intends to change a prevailing
    course of lending conduct with respect to overdraft accounts. RBC submits,
    however, that it never changed the prevailing course of lending conduct in this
    case. RBC argues it had allowed Willowbrook access to temporary overdraft
    credit facilities within agreed upon limits on the understanding they would be
    repaid annually. RBC submits the 2008 TAR constituted a request for additional
    credit as Willowbrook did not first repay the 2007 TAR. RBC submits that it responded
    reasonably to Willowbrooks failure to repay the 2007 TAR and Willowbrooks
    request for additional credit. Willowbrook, not RBC, proposed a change in their
    banking relationship.

[24]

With respect to its discretion to place
    Willowbrooks accounts into Special Loans, RBC submits that its decision was
    well founded in the context of this case. RBC asserts that, according to
Bhasin
, contracting parties are entitled to protect their own economic interests
    and that doing so, even where harm may be inflicted on the other party, is not
    a breach of the general principle of good faith. Moreover, RBC submits that the
    exercise of discretion in this case was a type of subjective discretionary
    decision-making intended to protect its own commercial best interests as
    recognized by this court in
Greenberg v. Meffert
(1985), 50 O.R. (2d) 755 (C.A.), [1985] O.J. No. 2539.

Analysis

Standard
    of review

[25]

The trial judges decision about whether RBC acted
    in bad faith is a question of mixed fact and law. It is owed deference absent an
    extricable error of law:
Housen v. Nikolaisen
,
    2002 SCC 33, [2002] S.C.R. 235, at paras. 10 and 36.

Did RBC act in bad
    faith by refusing to lend new money without notice?

[26]

This court held that a bank has a duty to give a
    customer reasonable notice of a change in the prevailing course of conduct with
    respect to overdraft lending in
Thermo King
,
    at para. 36. This reasonable notice duty is distinct from a banks more
    commonly litigated but separate duty to give reasonable notice before calling
    for repayment of a demand loan. This case concerns the former, not the latter.

[27]

As discussed in
Thermo King
, a banks duty to give reasonable notice of a change to a
    prevailing course of overdraft lending conduct existed at common law well
    before the Supreme Courts
Bhasin

decision. However,
    Cromwell J.s discussion in
Bhasin

regarding
    the good faith principle is nonetheless instructive as to the content and
    limits of the duty to provide reasonable notice in this case.

[28]

I will first review the underlying facts and
ratio
of
Thermo King
. In
Thermo
    King
, the bank allowed the customer to run an overdraft
    for three years, from 1973 to May 1976. The overdraft was required because the
    business performed poorly and suffered cash flow problems. The maximum amount
    of overdraft granted during that time was $30,086. Moreover, the customer owed
    the bank approximately $380,000 in other indebtedness.

[29]

On June 25, 1976, the customers account was
    overdrawn by $11,236. That day, the customer deposited $102,211 in cheques and
    asked the bank to issue a $100,000 cheque in U.S. funds. The deposit,
    therefore, removed the account from overdraft and resulted in a positive
    $89,949 account balance. The subsequent withdrawal request, however, would have
    put the account back into a $13,447 overdraft.

[30]

On June 29, 1976, without notice, the bank
    seized the funds in the customers current account as partial discharge of the
    customers other outstanding debts. The bank refused to issue the $100,000
    cheque that the customer needed to pay a supplier. Despite contractual language
    giving the bank the right to seize the funds for repayment of outstanding debts
    at any time, this court held that in light of the prevailing course of lending conduct,
    the bank did not have the right to lower the boom on the customer without
    advance notice. The bank was required to give reasonable notice of its decision
    to stop allowing overdrafts. Notably, the $13,447 of overdraft that would have
    resulted was less than the overdraft amounts the bank had previously extended to
    the customer.

[31]

There is no question that a prevailing course of
    lending conduct existed between the parties in this case. The conduct consisted
    of Willowbrook  making a TAR each winter and paying it down the following year
    before presenting  another TAR.

[32]

Here, however, it was Willowbrook that sought to
    change the prevailing course of lending conduct. It had not repaid the 2007 TAR,
    contrary to previous practice, and wanted an additional 2008 TAR. Willowbrook
    had exhausted its existing credit and it wanted more. RBC was not obliged to accede
    to Willowbrooks requests, especially since Willowbrooks requests would have
    resulted in RBC lending $500,000 more than it had ever lent to Willowbrook before:
Barclay Construction Corp. v. Bank of Montreal
(1989), 41 B.C.L.R. (2d) 239 at para. 12 (C.A.), [1989] B.C.J. No. 2257, at
    para. 12; and
XPG v. Royal Bank of Canada
,
    2017 ONSC 2598, at paras. 321-25.

[33]

Willowbrook essentially submits that reasonable
    notice meant that RBC had to continue to agree to advance new money during the
    alleged reasonable notice period. I do not agree. Here, RBC had little time to
    assess the request for more money after receiving the recent year-end financial
    statements. Willowbrook had run out of money by exhausting its credit limit at
    a time when it would have little revenue and substantial expenses.

[34]

Bhasin
does not require a lender in
    these circumstances to lend new money. In
Bhasin
, Cromwell J. stated at paras. 73, 80, and 86 that the new duty of
    honest contractual performance in that case: (i) did not require a party to
    forego advantages flowing from the contract; (ii) did not create commercial
    uncertainty in the law of contract; (iii) was clear and easy to apply; and (iv)
    did not impose a general duty on a contracting party to subordinate his or her
    interest to that of the other party. Moreover, at para. 70, Cromwell J.
    expressly wrote:

The principle of good faith must be applied in a manner that is
    consistent with the fundamental commitments of the common law of contract which
    generally places great weight on the freedom of contracting parties to pursue
    their individual self-interest.
In commerce, a
    party may sometimes cause loss to another  even intentionally  in the
    legitimate pursuit of economic self-interest
Doing so
    is not necessarily contrary to good faith and in some cases has actually been
    encouraged by the courts on the basis of economic efficiency

[Emphasis added.
    Citations omitted.]

[35]

Accordingly, I would dismiss this ground of
    appeal.

Did RBC act in bad faith by moving Willowbrooks
    accounts into Special Loans?

[36]

The parties agreed, and the record shows, that
    RBCs power to move an account into Special Loans was a discretionary power
    provided for by the lending contract. Willowbrook concedes that RBC did not
    violate any express term of the lending contracts in doing so.

[37]

While the existence of a Special Loans
    department might be a convenient label for internal bank purposes, Special
    Loans treatment is not a monolithic legal term of art carrying in itself a requirement
    for reasonable notice. The precise conduct of a bank and its position taken has
    to be assessed. For example, it could not be argued here that RBCs decision to
    change the account manager or to demand up-to-date financial information and
    appraisals in light of the request for additional credit and the failure to
    repay the 2007 TAR amounted to bad faith or was unreasonable.

[38]

Willowbrooks real complaint is that RBC would
    not extend additional credit during the alleged reasonable notice period. The principle
    of good faith performance of contractual obligations does not extend so far as
    to require RBC to subjugate its own financial interests by extending additional
    credit that it does not want to advance. There is no basis to hold that any
    other particular aspect of the Special Loans treatment was unreasonable or
    undertaken in bad faith, or that RBC had to give notice before reacting as they
    did to Willowbrooks changed circumstances and request for additional credit.

Did RBC exercise its contractual discretionary power
    in an objectively unreasonable manner and therefore act in bad faith?

[39]

Willowbrook submits that RBC had a duty to
    exercise its contractual discretion reasonably. Willowbrook contends that RBCs
    decision to move Willowbrooks accounts into Special Loans was objectively
    unreasonable and therefore amounted to bad faith. Willowbrook accepts the trial
    judges finding that RBCs employees did not subjectively act in bad faith.

[40]

Willowbrook relies on
Greenberg v.
    Meffert
(1985), 50 O.R. (2d) 755 (C.A.), [1985] O.J. No.
    2539. In that case, a contract provided that payment of a commission to a
    salesperson was solely within the employers discretion. This court observed at
    para. 18:

[T]he companys discretion in this matter is
    not unbridled, firstly, because the nature of this contract and the
    subject-matter of the discretion are such that the companys decision should be
    construed as being controlled by objective standards and secondly, because the
    exercise of the discretion, whether measured by subjective or objective
    standards, is subject to a requirement of honesty and good faith.

[41]

The
Greenberg
decision
    makes perfect sense. The parties could not reasonably have intended that the
    employer could arbitrarily deny commission. It was implicit that the discretion
    would have to be exercised reasonably.

[42]

Willowbrook submits that RBCs decision to place
    its accounts into Special Loans is similarly reviewable on an objective standard.
    It submits that the instant case is comparable to the facts of
Marshall

v. Bernard Place Corp
(2002), 58 O.R. (3d) 97 (C.A.),
    [2002] O.J. No. 463
.
I disagree.
Marshall

dealt with the scope of a residential home purchasers discretionary
    power to decline to waive a property inspection condition in a purchase and
    sale agreement. In that case, the inspection report noted that most
    deficiencies could be remedied at a minor cost, gave a rating of seven of nine,
    and described the property as a well-built house. On those facts, this court
    held at para. 21 that absent express contractual language to the contrary, an
    inspection report which identifies deficiencies in the construction or
    integrity of a house provides an objective basis on which to assess the
    potential exercise of discretion under a discretionary property inspection
    condition.

[43]

The factual context in
Marshall

is very different from RBCs business decision to move Willowbrooks
    accounts into Special Loans. The instant case does not concern a banks
    contractual discretion to realize upon its security, or to require repayment of
    a loan where it might well be appropriate to examine the reasonableness of
    those decisions. Rather, RBC made a choice to refuse to lend Willowbrook more
    money beyond limits to which each had previously agreed. When Willowbrook
    suggested that the parties end their banking relationship, RBC gave Willowbrook
    more time than they asked for to make those arrangements.

[44]

It is inapt to subject a banks decision whether
    to lend substantial new credit to an existing customer who is at the end of
    their credit limit to an objective reasonableness analysis. The choice whether
    to lend new money is at heart, a subjective business decision to be made by a bank.
    These decisions may be based on factors unrelated to a particular customer and
    should not be assessed by a court, after the fact, for objective fiscal
    prudence. (See
Fifth Third Bank v.

MPI Packaging Inc. et al
. 2013 ONCA 5 at. para. 12-16)  Nor was this a case where a bank
    acted dishonestly by promising additional financial support while secretly
    planning a receivership.

[45]

In any event, the trial judge identified some
    reasons why RBC might have decided to exercise its discretion to move
    Willowbrooks accounts into Special Loans. He ultimately found that RBCs
    decision was neither arbitrary nor capricious and was not in bad faith. There
    was no palpable or overriding error in these factual findings and I see no
    basis to interfere with the trial judges conclusions.

Did the trial
    judge err in his assessment of damages?

[46]

It is accordingly not necessary to deal with the
    assessment of damages.

Disposition

[47]

I would dismiss the appeal. If counsel are
    unable to resolve the issue of costs, RBC may make brief written submissions
    about costs due no later than 30 days after the release of this decision. Willowbrook
    shall respond within 15 days after receipt of RBCs costs submissions.

G. Pardu J.A.

I agree G.T. Trotter
    J.A.

I agree David M.
    Paciocco J.A.

Released: December 12, 2017


COURT OF APPEAL FOR ONTARIO

CITATION: 2057552 Ontario Inc. v. Dick, 2016 ONCA 7

DATE: 20160106

DOCKET: C60608

Doherty, MacPherson and van Rensburg JJ.A.

BETWEEN

2057552 Ontario Inc.

Plaintiff (Appellant)

and

Charles Dick, Esther Dick, Meir Dick,
Jacqueline Milevsky (nee Dick)
,
Joel
    Dick
,
8800383 Canada Inc.
, ABC Variety
    Services Inc. and ABC Variety

Defendants (
Respondents
)

Eliezer Karp, for the appellant

Fred Tayar and Colby Linthwaite, for the respondents

Heard: December 18, 2015

On appeal from the order of Justice Paul M. Perell of the
    Superior Court of Justice, dated May 19, 2015.

ENDORSEMENT

[1]

The personal respondents, Jacqueline Milevsky and Joel Dick, lent money
    to an ATM business run by their parents, Charles and Esther Dick, in exchange
    for third and fourth mortgages on the parents home.

[2]

The appellant 2057552 Ontario Inc. was a partner in a second ATM
    business with the Dicks. It alleged that Charles and Esther Dick
    misappropriated funds from the partnership business. The appellant moved for
    summary judgment against the respondent Dick adult children and 8800383 Canada
    Inc., a company created by the children. The appellants principal argument was
    that the mortgages received by the respondent children from their parents were
    fraudulent conveyances under the
Fraudulent Conveyances Act
(
FCA
).

[3]

The motion judge dismissed the appellants motion. He also granted
    summary judgment in favour of the respondents and dismissed the appellants
    action against the respondents, leaving intact the action against Charles and
    Esther Dick.

[4]

The appellant appeals on three grounds.

[5]

First, the appellant contends that the motion judge erred by dismissing
    the fraudulent conveyance summary judgment motion. It says that where there are
    suspicious transactions between family members, the burden shifts to the party
    seeking to justify the transaction. In short, says the appellant, a transfer of
    a property interest between family members is a badge of fraud and, in this
    case, the respondents did not rebut this inference.

[6]

We do not accept this submission. The motion judge made findings of fact
    relevant to a determination of whether there had been a fraudulent conveyance
    under the
FCA
. He found that there was good consideration for the
    mortgages and no intent to defeat, hinder or defraud creditors. There was
    documentary evidence relating to the money advanced to the senior Dicks by the
    respondents from their personal funds and borrowed from several third parties
    to support these conclusions. In our view, the motion judges factual findings
    on these issues, made in a Rule 20 context, are entitled to substantial
    deference: see
Hryniak v. Mauldin
, 2014 SCC 7, at paras. 80-81.

[7]

Second, the appellant asserts that the motion judge erred in dismissing
    its entire action against the respondents because there were still outstanding
    claims not dealt with at the summary judgment motion.

[8]

We disagree. The appellants notice of motion for summary judgment made
    it clear that the only claim against the respondents was the claim under the
FCA
:

THE MOTION IS FOR:

1.

An order granting Summary Judgment of the claims of the Plaintiffs
    against 8800383 Canada Inc., Jacqueline Milevsky, and Joel Dick (the Mortgage
    Defendants) and declaring that
the Mortgages of the Mortgage Defendants
    against the Property are void as fraudulent conveyances
. [Emphasis added.]

[9]

The appellant was alive to the full range of claims available to it
    against the various defendants. In its Statement of Claim, the appellant
    advanced claims of conversion, misappropriation and unjust enrichment against
    Charles and Esther Dick, but not against the respondents. Having made a tactical
    decision to proceed to summary judgment against the respondents on a claim of
    fraudulent conveyance, the appellant cannot now seek to add new claims that
    were not included in the Statement of Claim in the first place. In short, the
    motion judge dealt, appropriately, with what was in front of him.

[10]

Third,
    the appellant relies on the
Assignments and Preferences Act
(
APA
)
    to support a contention that the challenged mortgages are void against
    unsecured creditors.

[11]

We
    do not accept this submission. Before the motion judge, as well as in the Statement
    of Claim, the appellant proceeded on the basis of the
FCA
alone. It
    cannot now start over with the
APA
.

[12]

The
    appeal is dismissed. The respondents are entitled to their costs of the appeal
    fixed at $5,000, inclusive of HST and disbursements.

Doherty
    J.A.

J.C.
    MacPherson J.A.

K. van
    Rensburg J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: 2256306 Ontario Inc. v. Dakin News Systems Inc.,
    2016 ONCA 74

DATE: 20160126

DOCKET: C60050

Weiler, LaForme and Huscroft JJ.A.

BETWEEN

2256306 Ontario Inc. and Ali Reda

Plaintiffs

(Respondents)

and

Dakin News Systems Inc. and Warren Smagaren

Defendants

(Appellants)

Harjaap Mann, for the appellants

Michael Fleischmann, for the respondents

Heard:  January 15, 2016

On appeal from the orders of Justice Dale Parayeski of
    the Superior Court of Justice, dated January 27, 2015, with reasons reported at
    2015 ONSC 566, 39 B.L.R. (5th) 136.

ENDORSEMENT

[1]

The appellants appeal from an order dismissing their motion
    for summary judgment and from an order granting the respondents cross-motion
    for summary judgment and declaring that the respondents are entitled to
    statutory rescission of their franchise agreement with the appellants.

[2]

This litigation arises out of the respondents
    purchase of a business operating as International News from a franchisee of the
    appellants in November 2010. Although the respondents operated the business
    without interruption following the purchase, they did not enter into a
    franchise agreement with the appellants until October 29, 2012.

[3]

In August 2013, the respondents purported to
    rescind the franchise agreement because the appellants failed to provide
    disclosure as required under the
Arthur Wishart Act
(Franchise Disclosure)
, 2000, S.O. 2000,
    c. 3.

[4]

The appellants argued that they were exempt from the
    disclosure requirement under ss. 5(7)(a)(iv) and 5(7)(g)(ii)
.
The motion
    judge found that neither provision exempted the appellants from their
    disclosure obligation.

[5]

The appellants argue that they were denied a fair hearing
    by the motion judge because they were not heard on the respondents cross-motion.
    The motion judges remarks did create an expectation that there would be
    further argument on the respondents cross-motion if the appellants were
    unsuccessful in their motion for summary judgment. However, the issues on the
    motion and cross-motion were intrinsically connected and all of the relevant
    material was before the court when the appellants motion was argued.

[6]

It is uncontroverted that the parties entered into a franchise agreement
    at the instance of the appellants after the respondents had purchased and
    operated the business for some time.

[7]

The franchise agreement covered the period the respondents had been
    operating the business and extended into the future. It included a requirement
    that the respondents pay a $10,000 franchise fee, and some of its terms were
    slightly different than the franchise agreement that had covered the prior
    franchisee.

[8]

Having chosen to require a franchise agreement with the respondents, the
    appellants cannot now argue that a franchise agreement was already in place
    with them, such that they are exempted from the disclosure requirement by s.
    5(7)(a)(iv). Moreover, the franchise agreement obligated the respondents to pay
    a transfer fee of $10,000, and as a result the appellants are not exempt from
    disclosure by s. 5 (7)(g)(ii).

[9]

The motion judges findings of fact are supported by the record and
    there is no basis for this court to interfere with them. In the circumstances
    of this case, those findings rendered summary judgment in favour of the
    respondents inevitable. As a result, the motion judges decision to deal with
    both the motion and cross-motion resulted in no prejudice to the appellants.

[10]

The
    appeal is dismissed with costs to the respondent of $13,500, inclusive of all
    applicable taxes and disbursements.

K. M. Weiler J.A.

H.S.
    LaForme J.A.

Grant
    Huscroft J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Bonaccorso v. Optimum Insurance Company Inc., 2016
    ONCA 34

DATE: 20160114

DOCKET: C60473

Cronk, Tulloch and van Rensburg JJ.A.

BETWEEN

Julie Bonaccorso

Appellant

and

Optimum Insurance Company Inc.

Respondent

Daniel Roncari, for the appellant

Amanda M. Lennox and Rebecca J. Brown, for the
    respondent

Heard: January 4, 2016

On appeal from the order of Justice H.S. Arrell of the Superior
    Court of Justice, dated April 24, 2015, with reasons reported at 2015 ONSC 2633.

ENDORSEMENT

[1]

The appellant appeals the order of the motion judge on a summary
    judgment motion dismissing her claim for income replacement benefits.

[2]

On February 4, 2008, the appellant was injured in a motor vehicle
    accident. She received income replacement benefits from the respondent until
    June 28, 2009, when she returned to work.

[3]

The respondent sent a letter to the appellant on June 22, 2009, advising
    that no further benefits would be payable once she began full time work.

[4]

On February 8, 2010, the respondent further advised the appellant by
    letter that her income replacement benefits were being discontinued effective
    June 28, 2009. This February 8, 2010 letter was accompanied by an explanation
    of benefits. It contained a description of the step-by-step process to dispute
    the refusal and a bolded warning that there was a two-year time limit from the
    date of the insurers refusal, to arbitrate or commence a lawsuit in court.

[5]

The appellant continued to work until February 15, 2011, when she ceased
    her employment allegedly because of her injuries sustained in the accident.

[6]

The appellant requested a reinstatement
    of income replacement benefits on July 13, 2012. The respondent denied this
    request on July 20, 2012 on the basis that the limitation period to dispute the
    stoppage had expired. The appellant filed for mediation on October 9, 2012 and
    commenced her action claiming income replacement and other benefits on November
    8, 2013.

[7]

The motion judge concluded that the appellants claim for further income
    replacement benefits was statute-barred and granted the respondents motion for
    summary judgment in respect of this claim. He found that the respondents
letter of February 8, 2010 and the accompanying explanation
    of benefits constituted a valid refusal of benefits.
The two-year
    limitation period provided in s. 281.1(1) of the
Insurance Act
, R.S.O.
    1990, c. I.8, and s. 51(1) of the
Statutory Accident Benefits Schedule
    Accidents On or After November 1, 1996
, O. Reg. 403/96 (the SABS), expired
    on February 8, 2012.

[8]

The appellant submits that the motion judge erred in finding that her
    claim for income replacement benefits was statute-barred. We disagree.

[9]

The motion judge was correct in determining that this was an appropriate
    case for summary judgment. In finding that there was no genuine issue requiring
    a trial with respect to the income replacement benefits claim, he outlined r. 20.04
    of the
Rules of Civil Procedure
, R.R.O. 1990, Reg. 194, and applied
    the principles in
Hryniak v. Mauldin
, 2014 SCC 7, [2014] 1 S.C.R. 87.
    There were no facts in dispute. The motion judge had sufficient material before
    him to make a decision on the merits of the claim, and in particular on the
    defence that the claim was statute-barred.

[10]

The
    appellant argues that the refusal was not effective to start the running of the
    limitation period because it was premature.

[11]

In
    our view, the motion judge was correct to hold that the respondents letter of
    February 8, 2010, advising that income replacement benefits were being
    discontinued, was a refusal of a benefit sufficient to commence the running of
    the relevant two-year limitation period. In reaching this conclusion, the
    motion judge applied, as he was obliged to do, the governing principles
    regarding such a refusal, as set out by the Supreme Court of Canada in
Smith
    v. Co-Operators General Insurance Company
, 2002 SCC 30, [2002] 2 S.C.R. 129.

[12]

The
    motion judge reviewed and quoted from the refusal letter and accompanying
    materials. The respondent clearly discontinued the appellants income
    replacement benefits, explained the process to dispute the discontinuance, and
    set out the two-year time limit in which the appellant could contest the
    decision. The respondent referred to s. 37(2)(d) of the SABS, and enclosed a
    copy. That provision permits the discontinuance of payment of a specified
    benefit (including income replacement benefits) if the insured person has
    resumed his or her pre-accident employment duties. The February 8, 2010
    refusal therefore complied with
Smith
.

[13]

The
    insurers refusal was not premature. The appellant received income replacement
    benefits from the respondent after her accident. A claim had been made and
    benefits were received. Despite the return to work, one single claim arose from
    the accident, as explained by the Appeal Division of the Financial Services
    Commission of Ontario in
Ladhar v. Economical Mutual Insurance Co.
,
    2012 CarswellOnt 5805, at para. 20. The insurers letter of February 8, 2010
    was a valid termination of benefits and the two-year limitation period began to
    run on this date.

[14]

The
    appellant argues that the motion judge erred in not considering the impact of
    s. 11 of the SABS. Section 11 provides for a temporary return to work without
    affecting the right to resume receiving income replacement benefits, if as a
    result of the accident, the insured is unable to continue in the employment. Therefore,
    the appellant argues, her claim for these benefits only crystallized when she
    stopped working in February 2011. Section 11 of the SABS states:

11.
A person receiving an income
    replacement benefit may return to or start an employment at any time during the
    104 weeks following the onset of the disability in respect of which the benefit
    is paid without affecting his or her entitlement to resume receiving benefits
    under this Part if, as a result of the accident, he or she is unable to
    continue in the employment.

[15]

The
    motion judge was alive to this issue. Though he did not explicitly analyse the
    effect of s. 11, he found that this courts decisions in
Haldenby v.
    Dominion of Canada General Insurance Co.
(2001), 55 O.R. (3d) 470, and
Wadhwani
    v. State Farm Mutual Automobile Insurance Company
, 2013 ONCA 662, [2013]
    O.J. No. 4972, provide a complete answer to the appellants limitations argument.
    We agree.

[16]

Haldenby
and
Wadhwani
dealt with income
    replacement benefits claims asserted after a temporary return to work. In both
    cases, an insured who had received income replacement benefits that were
    terminated claimed the resumption of such benefits after an attempted return to
    work. This court held that the limitation period ran from the insurers refusal
    to pay benefits, notwithstanding that the insured had suffered no actual loss
    in the interim period.

[17]

Part of the courts analysis in
Haldenby
depended
    on the wording of the relevant SABS provisions, which have since changed: see
    paras. 21-27 and 29-33. But the court also observed that the insureds argument
    based on the return to work provision (which is also made here) would extend a
    claimants entitlement to benefits for an indeterminate period of time, and
    would be inconsistent with the need for finality, certainty and the principle
    of diligence underlying limitation periods: see paras. 35 and 36.

[18]

This reasoning was followed in
Ladhar
, which
    analyzed the differences in the SABS wording. And both
Haldenby
and
Ladhar
were approved and followed by this court in
Wadhwani
.

[19]

Accordingly,
    the applicable limitation period did not begin to run only when the respondent
    refused to pay the further income replacement benefits claimed by the appellant.
    Rather, the two-year limitation period commenced in February 2010 when the
    insurer exercised its rights to terminate such benefits and provided a valid
    refusal of benefits. Simply put, the temporary return to work provision does
    not prevail over the limitation period:
Haldenby
, at para. 36;
Ladhar
,
    at para. 24.

[20]

For
    these reasons, the appeal is dismissed. Costs to the respondent, as agreed
    between the parties, in the sum of $5,500, inclusive of disbursements and all
    applicable taxes.

E.A. Cronk J.A.

M. Tulloch J.A.

K. van Rensburg J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Bruce Eco Landbank Inc. v. Bruce Eco Industrial
    Park Corporation, 2016 ONCA 35

DATE: 20160114

DOCKET: C60138

Weiler, LaForme and Huscroft JJ.A.

BETWEEN

Bruce
    Eco Landbank Inc. and

Crooks Hollow Farm
    Corporation

Applicants (Respondents)

and

Bruce
    Eco Industrial Park Corporation and

Terra Corporation

Respondents (Appellants)

Wade W. Sarasin, for the appellants

William P. Dermody, for the respondents

Heard: January 12, 2016

On appeal from the judgment of Justice Gerald E. Taylor
    of the Superior Court of Justice, dated February 10, 2015.

APPEAL BOOK ENDORSEMENT

[1]

The issue in this case is whether under the terms of the agreement, the
    appellants or any associated company were entitled to register a Notice
    pursuant to s. 71 of the
Land Titles Act,
R.S.O. 1990, c. L.5.

[2]

The trial judge found that the appellants were not, in the words of s.
    71, entitled to or interested in any unregistered estate, right interest or
    equity in land. The core of his reasoning is that, a potential right to become
    a 50% shareholder in a corporation that owns land, so as to become entitled to
    any share of any profit generated from the sale of that land, is not entitled to
    register under s. 71. We agree.

[3]

Although the appellant submits that if a party has a potential financial
    interest in the outcome of a sale of land, that party may register under s. 71,
    in our opinion the submission put forward here is too remote from the intended
    ambit of s. 71.

[4]

By agreement costs of the appeal are fixed in the amount of $10,000 plus
    HST and are payable to the respondents.


COURT OF APPEAL FOR ONTARIO

CITATION: College of Chiropractors of Ontario v. Dies, 2016
    ONCA 2

DATE: 20160105

DOCKET: C60513

Simmons, Pepall and Pardu JJ.A.

BETWEEN

College of Chiropractors of Ontario

Applicant (Respondent)

and

Stephen Dies

Respondent (Appellant)

Alex Minkin, for the appellant

Chris G. Paliare and Karen Jones, for the respondent

Heard: January 4, 2016

On appeal from the Order of Justice Elizabeth M. Stewart of
    the Superior Court of Justice, dated May 1, 2015.

ENDORSEMENT

[1]

At the conclusion of the oral hearing, we
    dismissed the appeal for reasons to follow.  These are our reasons.

[2]

On May 19, 2006, a consent order was granted
    requiring that the appellant refrain from: using the title doctor or
    chiropractor; holding himself out as a person qualified to
practise
as a chiropractor; and performing any controlled acts, including
    spinal adjustment/manipulation, unless registered with, and a member of, the
    College of Chiropractors of Ontario.

[3]

In reasons released on December 30, 2014, the
    motion judge found the appellant to be in contempt of the 2006 order.  By order
    dated May 1, 2015, she sentenced him to house arrest for a period of six months
    and ordered that if the appellant breached any of the terms of the order for
    house arrest, he should be brought before the court and ordered to serve the
    balance of his sentence in custody. In addition, the motion judge granted the
    respondent leave to issue a writ of sequestration directing the Sheriff to take
    possession and dispose of the appellants office and chiropractic equipment,
    and also ordered that the appellant pay the costs of the proceeding, fixed in
    the amount of $35,000.

[4]

The appellant appeals from the order finding him
    in contempt and also seeks leave to appeal sentence.

[5]

First, he submits that the motion judge erred in
    assessing credibility and making a finding of contempt in the absence of
viva
    voce
evidence.  He argues that as there was conflicting evidence on the
    central question of whether he had performed any controlled acts, the motion
    judge erred in failing to order a trial of the issue. He relies on
R. v.
    Jetco Manufacturing Ltd.

(1987), 57 O.R. (2d) 776,
Fischer v.
    Milo
, (2007), 44 R.F.L. (6th) 134, and
Campo v. Campo
, 2015 ONSC
    1349 in support of his position.

[6]

We do not accept his submission.

[7]

With the benefit of counsel, the appellant
    agreed to a timetable for the contempt hearing that provided for no
viva
    voce
evidence.  He never sought to withdraw from that
    position.  At the motion itself, again with the benefit of counsel, he
    confirmed that he did not want to call
viva voce
evidence.  The motion judge noted his position on the record.

[8]

None of the cases relied upon by the appellant
    reflect such a factual record. The history of this proceeding, including the
    motion judge's endorsement, makes it clear that the appellant chose to proceed
    with the motion based on affidavit evidence and cross-examinations, and without
    oral evidence. Having made that tactical decision and lost, the appellant is
    not entitled to resile from it now: See
Lauzier v. Ranger
1995 CanLII 298 (Ont. C.A.).

[9]

Moreover, there was ample and overwhelming
    evidence to support the finding of contempt.  There was no real dispute about the
    acts performed by the appellant and there was uncontradicted expert evidence on
    their characterization as chiropractic treatment. Additionally, extensive
    unchallenged evidence of the investigations conducted by the respondent was
    before the motion judge.  Despite the appellants undertaking to comply fully
    with the 2006 order, the motion judge was justifiably satisfied that the
    evidence demonstrated beyond a reasonable doubt that the appellant was in
    breach of the 2006 order.

[10]

Second, the appellant submits that the motion
    judge erred in failing to impose the least restrictive sanction to ensure
    compliance and accord with principles of fundamental justice.  He states that a
    finding of contempt coupled with a costs award would achieve this objective.
    He argues that as his contempt had been fully purged at the time of sentencing,
    there was no need for an order structured to ensure compliance and the motion
    judge failed to impose the least restrictive sanction available in these
    circumstances.

[11]

We reject this submission. The motion judge
    expressly considered the principle of the least restrictive sanction and the
    steps the appellant had taken to purge his contempt. She also accepted as fact
    that he is aging, has health issues, and is the sole caregiver and attendant
    for his ailing wife. However, in her reasons, she also noted:

In this case, [the appellants] defiance of
    Smith J.s order has been obvious, unrepentant and ongoing up to just days
    before his sentencing hearing.  For years, [the appellant] has been an
    obstinate scofflaw, demonstrating an utter lack of respect for the governing
    body of his former profession, the public whose safety the College is obliged
    to protect, and the courts to whom the College turned as a last resort when all
    else failed to deter his conduct.

There is therefore a significant element of
    public protection involved in the fashioning of a consequence fit for this
    case.  [The appellant] has been engaging in a regulated activity without
    regulation of competence or capacity, and outside mandatory rules of conduct.
    A serious penalty is called for.

[12]

The motion judge's findings are fully supported
    by the record and we see no basis to interfere with her decision.

[13]

Lastly, on consent we order a variation of the
    language of paragraph 3 of the May 1, 2015 order so that it states:

THIS COURT ORDERS that if the
    respondent breaches any of the conditions set out in paragraph 2 herein, he
    will be brought before the Court and ordered to serve the balance of his
    sentence in custody unless he can show why incarceration should not at that
    time be enforced.

[14]

The appeal is therefore allowed in part and paragraph 3 of the
    May 1, 2015 order is varied as described above.  The appellant is to pay the
    respondent its costs on a substantial indemnity scale fixed in the amount of
    $15,000 inclusive of disbursements and HST.

Janet Simmons
    J.A.

S.E. Pepall J.A.

G. Pardu J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Conundrum Capital Corporation v. Century Plumbing
    and Heating, 2016 ONCA 20

DATE: 20160111

DOCKET: C60555, C60556 and C60557

MacPherson, Pepall and Hourigan JJ.A.

BETWEEN

Conundrum Capital
    Corporation

Plaintiff

and

Century Plumbing and Heating, Oxford Properties
    Group Inc., ADT Security Services Canada Inc./Intercon Security Limited and
    Brookfield Properties Ltd.

Defendants

(Century Plumbing  Appellant)

ADT/Intercon Security  Respondents)

Christopher Morrison and Joel Cormier, for the appellant

John Downing, for the respondents

Heard: January 6, 2016

On appeal from the judgment of Justice James F. Diamond
    of the Superior Court of Justice, dated May 11, 2015.

ENDORSEMENT

[1]

The appellant, Century Plumbing and Heating, is a defendant in several
    actions relating to a flood in the TD Canada Trust Tower in Toronto. The
    respondents, ADT Security Services Canada Inc. and Intercon Security Limited,
    provided security services at the tower at the time of the flood.

[2]

The respondents brought five motions for summary judgment seeking orders
    removing them as a party (defendant, third party, fourth party) from all of the
    actions relating to the flood. All of the parties in these actions except the
    appellant either consented to or did not oppose the relief sought by the
    respondents.

[3]

The motions judge, Diamond J., granted the motions for summary judgment:

In the result, I therefore grant summary judgment in favour of
    ADT and Intercon and the claims, third party claims and fourth party claims
    against ADT and Intercon are hereby dismissed.

[4]

The appellant appeals this decision on three grounds.

[5]

First, the appellant contends that the motions judge erred by stating
    that all the parties agreed that the Building Automation System (BAS) on the
    premises had frozen on the night of the flood.

[6]

We do not accept this submission. On this issue, the motions judge said:

Century does not really dispute that the 1:24 a.m. alarm
    related to low water pressure, and unfortunately Intercon never received that
    1:24 a.m. alarm due to the BAS system failing.

[7]

The appellant accepted the proposition in the first part of the
    sentence. The appellant did not accept the content of the second part of the
    sentence, and the motions judge did not suggest otherwise. The second part of
    the sentence is the motion judges conclusion and it flows from his review of
    the evidence. That evidence included the defendant Brookfields (the building
    owner) admission, very much against interest, that its BAS system had frozen at
    the relevant time.

[8]

Second, the appellant submits that the motions judge erred by not considering
    the video evidence (a video from the offices of the tenant Conundrum where the
    flood originated) tendered by the appellant.

[9]

We disagree. This proposed evidence related to the appellants
    contention that the 1:06 a.m. alarm could have been related to the low water
    pressure caused by the leak. The motions judge pointed out that there was about
    a six hour difference between the flood time and the time shown on the video
    and then said:

On the facts of this case, and as argued by Century itself,
    minutes counted. If the filing of the video itself, in the absence of any
    admissible evidence to assist the Court in determining the actual time
    contemporaneous with the events captured in the video, amounts to Centurys
    best foot forward, then in my view it has failed to establish the presence of a
    genuine issue requiring a trial, especially in the face of the evidence relied
    upon by Intercon as summarized above.

We agree with this analysis.

[10]

Third,
    the appellant asserts that the motions judge erred in relying on inadmissible
    evidence including a letter produced by Brookfield (a different defendant) to
    make factual findings against the appellants position on the issue of the 1:06
    a.m. alarm.

[11]

We
    do not accept this submission. Irrespective of that evidence, there was other
    admissible evidence to support the motions judges conclusion that the 1:24
    a.m. alarm related to low water pressure (and hence the flood) whereas the 1:06
    a.m. alarm could not have related to anything serious and or anything to do
    with the flood. In addition, there was no reliable evidence to the contrary.

[12]

The
    appeal is dismissed. The respondents are entitled to their costs of the appeal
    fixed at $20,000, inclusive of disbursements and HST.

J.C.
    MacPherson J.A.

S.E.
    Pepall J.A.

C.W. Hourigan
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Conway v. The Law Society of Upper Canada, 2016
    ONCA 72

DATE: 20160126

DOCKET: C59451

Weiler, van Rensburg and Roberts JJ.A.

BETWEEN

David Robert Conway

Appellant

and

The Law Society of Upper Canada
and Lorne
    Levine

Respondent

David Robert Conway, in person

Brendan van Niejenhuis, for the respondent

Heard:  September 8, 2015

On appeal from the judgment of Justice F.L. Myers of the Superior
    Court of Justice, dated September 11, 2014.

By the Court:

Overview
:

[1]

The appellant appeals from the
    dismissal of his action as against the respondent, The Law Society of Upper
    Canada (the LSUC), following a motion to strike the appellants statement of
    claim, as disclosing no reasonable cause of action and as being frivolous,
    vexatious and an abuse of process.

[2]

The appellants dispute with the
    LSUC has a long history stretching back to his first administrative suspension
    in June 2000 for his failure to pay transaction levies, and involves a myriad
    of different civil, disciplinary and bankruptcy proceedings that form the basis
    for his claims against the LSUC.

[3]

In particular, the appellant
    complains that he has been the subject of relentless and inequitable targeting,
    abuse of process and denial of due process by the LSUC in the following
    proceedings:  the administrative suspensions by the LSUC for his failure to
    remit transaction levies and forms; the civil proceedings brought by the LSUC
    to recover the transaction levies owing, in which he counterclaimed for unfair
    treatment by the LSUC; the disciplinary proceedings leading to disbarment for
    practising as a paralegal while his license to practise as a lawyer was
    suspended; the refusal of the LSUC to consider his application to practise as a
    paralegal on a grandfathered basis; the trustee proceedings involving his
    client accounts; and his bankruptcy proceedings in which the LSUC opposed his
    filing of a proposal and then unsuccessfully opposed his discharge.

[4]

The appellant settled the civil
    and trustee proceedings with the LSUC and entered into releases and consent
    judgments. He was discharged unconditionally from bankruptcy. The finding that
    the appellant had engaged in unauthorized practice resulted in his disbarment,
    but was set aside in appeal proceedings.  Ultimately, the appellants L1
    licence was reinstated in April 2013.

[5]

On April 10, 2013, he commenced
    his present claim against the LSUC.

Analysis
:

i.        Whether the statement of claim as against
    the LSUC should have been struck out in its entirety:

[6]

The appellant argues that the motion
    judge erred in striking out his statement of claim in its entirety as
    disclosing no reasonable cause of action and as being frivolous, vexatious and
    an abuse of process. In particular, he complains that the LSUCs mistake in
    proceeding with his administrative suspension under s. 46 of the
Law
    Society Act
, R.S.O. 1990, c. L.8 (failure
    to remit transaction levies), rather than s. 47 of the Act (failure to file
    levy forms), gave rise to a new cause of action that was not covered by the
    2008 release and consent judgment in the LSUCs civil action.

[7]

Before a statement of claim is
    struck out under rule 21.01(1)(b) of the
Rules of Civil Procedure
, it must be plain and obvious, on a generous reading
    of the pleading, and taking the factual allegations as true or capable of
    proof, that it discloses no reasonable cause of action:
Hunt v.
    Carey Canada Inc.
, [1990] 2 S.C.R. 959.

[8]

The motion judge struck out the
    entirety of the appellants statement of claim as against the LSUC for the
    reasons that are summarized as follows:

i.
Many of the appellants factual allegations are
    completely irrelevant to any reasonable cause of action against the LSUC,
    constitute a pleading of evidence, and are frivolous, vexatious and scandalous.

ii.       The appellants allegations concerning the
    LSUCs conduct in dealing with the appellants failure to pay transaction
    levies were the subject of litigation that was settled by a release and court
    order such that the allegations were an improper attempt to re-litigate those
    settled and released issues. Buyers remorse regarding settlement and
    complaints about the pre-trial judge do not give rise to a tenable cause of
    action.

iii.      The appellants allegations concerning the
    LSUCs trustee services, including its efforts to obtain fees for acting as trustee
    of the appellants practice, resulted in a release and consent order of the
    court which cannot be subject to collateral attack or re-litigation. Alternatively,
    these are bald allegations of defamation which are statute-barred.

iv.      The appellants allegations concerning the
    regulatory proceedings under the
Law Society Act
with respect to the
    LSUCs regulation of lawyers and paralegals are a collateral attack on
    administrative decisions already made or that ought to have been pursued under
    the administrative regime.

v.       The appellant has no right of action against
    the LSUC because there is no right of action against a creditor for merely voting
    to reject a debtors proposal in bankruptcy and opposing a bankrupts discharge
    from bankruptcy.

vi.      The appellants allegations could be taken
    together as an allegation that the LSUC intentionally abused its statutory
    authority to single out and injure the appellant. The only tort that could
    apply would be misfeasance in public office, the constituent elements of which
    were not pleaded by the appellant. In any event, even if the LSUC was wrong in
    refusing to allow the appellant to apply for a paralegal license while
    suspended, it was corrected by the appeal tribunal.

[9]

We agree with the motion judges
    reasoning and conclusions that the various individual acts by the LSUC of which
    the appellant complains are incapable of giving rise individually to any viable
    cause of action in the manner as pleaded by the appellant.

[10]

Many of the factual allegations
    are irrelevant to any tenable of cause of action, such as the recitation of his
    family, education and work history. As a result, the motion judge correctly
    struck out these allegations as scandalous, frivolous and vexatious.

[11]

The appellant`s main focus on
    appeal was that the motion judge failed to appreciate that the appellant had a
    separate cause of action against the LSUC because his administrative suspension
    was actually and erroneously carried out under s. 47 of the
Law
    Society Act
for his alleged failure to
    remit levy forms, rather than under s. 46 of the Act for his admitted failure
    to remit transaction levies. The appellant argues that he did not discover this
    error until after he had settled the civil proceedings with the LSUC.

[12]

On a fair reading of the statement
    of claim, there is no question that by virtue of the releases he signed and the
    consent judgments that he agreed to, the appellant settled his complaints
    against the LSUC in relation to the civil and trustee proceedings that he is
    now seeking to re-litigate in the present action. The appellants long and
    detailed pleading recites the entire history of his dealings with the LSUC,
    including the terms and conditions of the settlements of certain LSUC
    proceedings and his complaints and claims. The appellant confirmed that he has
    pleaded all of the facts on which he relies.

[13]

The motion judge correctly struck out
    these claims as an abuse of process under rule 21.01(3)(d).

[14]

In particular, the appellants
    complaints about his administrative suspensions, whether under section 46 or 47
    of the
Law Society Act
, are
    included in his counterclaim under the rubric of the alleged unfairness of the LSUCs
    procedures and mistreatment of him. There is no question that the appellant had
    not remitted transaction levies so that the LSUC could properly suspend him
    from practice in 2000 under s. 46 of the Act. The release that the appellant
    signed in August 2008 comprised all claims that he had arising out of his
    suspension from practice, including his claims related to the alleged lack of due
    process and destruction of his law practice.

ii.      Whether
    leave to amend the statement of claim should have been granted
:

[15]

The appellant argues that the
    motion judge erred in determining that the appellant should not be granted
    leave to amend his pleading because of the motion judges conclusion that there
    was no actionable tort possible on the facts as alleged in the statement of
    claim.

[16]

The decision not to grant leave to
    amend should only be made in the clearest of cases, when it is plain and
    obvious that no tenable cause of action is possible on the facts as alleged:
South
    Holly Holdings Ltd. v. The Toronto-Dominion Bank
, 2007 ONCA 456, at para. 6. That said, the decision whether or not to
    grant leave to amend a pleading is a discretionary one, and absent palpable and
    overriding error of fact or error of law, such a decision is subject to
    deference on appeal:
Mortazavi v. University of Toronto
, 2013 ONCA 655, at para. 3.

[17]

The motion judge carefully
    considered the cumulative effect of all of the appellants complaints against
    the LSUC and concluded that the only tort that may have any application based
    on the facts as pleaded was the tort of misfeasance in public office. The
    motion judge explained his reasoning as follows:

As noted above, nearly all of the plaintiffs allegations could
    be taken together as an allegation that the LSUC intentionally abused its
    statutory authority to single out and injure the plaintiff. The appellant
    submitted that the LSUC is accountable in damages if [it] acts outside its
    statutory authority. He had no law to support that submission. The plaintiff
    does not expressly mention the tort of misfeasance in public office by name,
    but it is the only tort that might cover the essential thrust of the
    plaintiffs allegations. (para. 11)

[18]

The motion judge reviewed the
    constituent elements of the tort of misfeasance in public office and concluded:
    Try as I might to allow for pleading deficiencies, I cannot see a proper plea
    of this tort or that one is possible on the facts alleged (para. 12).

[19]

While the motion judge correctly
    concluded that the appellants statement of claim was untenable in that it did
    not disclose in proper form the constituent elements of the tort of misfeasance
    in public office or any other properly pleaded tort, he erred in determining
    that the pattern of acts and omissions alleged by the appellant in his
    statement of claim, even if properly pleaded, could not give rise to a cause of
    action, and in failing to grant leave to amend the pleading if it was deficient
    in pleading the cause of action.

[20]

The tort of misfeasance in public
    office has been variously described in the case law as the tort of abuse of
    public office or abuse of statutory power:
Odhavji Estate v.
    Woodhouse
, 2003 SCC 69, at paras. 25 and
    30. Whatever the nomenclature, the essence of the tort is the deliberate and
    dishonest wrongful abuse of the powers given to a public officer, coupled with
    the knowledge that the misconduct is likely to injure the plaintiff:
Odjhavji
    Estate v. Woodhouse,
at para. 23.  Bad
    faith or dishonesty is an essential ingredient of the tort:
Odhavji
    Estate v. Woodhouse
, at para. 28 and
Gratton-Masuy
    Environmental Technologies Inc. v. Ontario,
2010 ONCA 321, at para. 85.

[21]

The LSUC relies on the statutory
    immunity under s. 9 of the
Law Society Act
, for acts engaged in good faith in the performance of
    its duties or functions.  Section 9 of the
Law Society Act
provides as follows:

No action or other proceedings for damages shall
    be instituted against the Treasurer or any bencher, official of the Society or
    person appointed in Convocation for any act done in good faith in the
    performance or intended performance of any duty or in the exercise or in the
    intended exercise of any power under this Act, a regulation, a by-law or a rule
    of practice and procedure, or for any neglect or default in the performance or
    exercise in good faith of any such duty or power.

[22]

Mere negligence in the good faith
    performance of the LSUCs duties or functions is not enough to establish
    liability. However, an absence of good faith or bad faith, involving malice
    or intent, is sufficient to ground a properly pleaded cause of action against
    the LSUC. See:
Edwards v. Law Society of Upper Canada
, [2001] 3 S.C.R. 562;
Finney v. Barreau du
    Québec,
[2004] 2 S.C.R. 17.

[23]

The appellants statement of claim
    is replete with allegations that the LSUC intentionally acted dishonestly,
    fraudulently, and without statutory authority in its dealings with the
    appellant, knowing that its actions would cause and did cause damages to the
    appellant.

[24]

In particular, the appellants
    allegations concerning the LSUCs commencement of disciplinary proceedings in
    relation to the appellant practising as a lawyer while under suspension, the
    LSUCs failure to process his application as a paralegal, and the manner of the
    LSUCs opposition to his discharge application from bankruptcy, may support, if
    properly pleaded, a cause of action against the LSUC, based upon an alleged
    cumulative and relentless pattern of bad faith conduct by the LSUC that was
    directed against the appellant and caused him harm.

[25]

We do not agree with the motion
    judges assessment that the allegations of fact in the appellants statement of
    claim could not give rise to a properly pleaded cause of action for misfeasance
    in public office.

[26]

While, as the motion judge stated,
    [a]llegations of singling out may be no more than a regular carrying out of
    its duties against an individual (para. 13), they, and some of the other
    allegations in the statement of claim, may also support a cause of action against
    the LSUC on the ground that the LSUC abused its statutory authority and acted
    in bad faith in its dealings with the appellant, namely, that the LSUC may have
    acted with malice or intent to harm.

[27]

For example, in paragraph 182 of
    his statement of claim, the appellant complains of the uneven treatment that he
    received in relation to his paralegal application, pleading that the LSUC
    singled out the appellant where it refused to process his application and denied
    his grandparent status. Although the issue came up during the course of the
    proceedings, LSUC has not named any other applicant who was treated in a like
    manner.

[28]

The appellants factual allegations
    of unequal treatment by the LSUC resemble those in the claim of the plaintiff
    lawyer in
Dechant v. Law Society of Alberta
, 2006 ABQB 908, which the Alberta Court of Queens
    Bench refused to dismiss. In that case, the parties had entered into a
    settlement of disciplinary proceedings. The plaintiff lawyer alleged in her
    statement of claim that she was the victim of specialized and malicious
    treatment by the Law Society after the execution of the Settlement Agreement
    (para. 10). The specific malicious and egregious actions that the plaintiff
    lawyer pleaded included that the Law Society treated her differently than other
    members with her status and that they impeded her efforts to practise law. The
    court held that the allegations of specialized treatment, among other actions
    by the Law Society, could support the claims that included abuse of public
    office.

[29]

The LSUCs challenge of the
    statement of claim was brought by way of a motion under rule 21 of the
Rules
    of Civil Procedure
and was not a motion for
    summary judgment under rule 20. As a result, as the motion judge noted, the
    factual allegations contained in the appellants statement of claim had to be
    taken as true unless they were patently ridiculous or incapable of proof:
Nash
    v. Ontario
(1995), 27 O.R. (3d) 1 (C.A.).

[30]

Taking all of the appellants
    factual allegations as true and reading the essence of the pleading as a claim
    for misfeasance in public office, it is not plain and obvious that a proper
    pleading of a reasonable cause of action founded on the alleged bad faith
    conduct against the LSUC would fail. As a result, the motion judge erred in
    refusing leave to amend to correct the deficiencies in the pleading.

[31]

That being said, the appellants
    allegations of his mistreatment by the LSUC up to August 2008, namely, the
    allegedly unfair actions of the LSUC towards him in relation to his
    administrative suspensions and disciplinary proceedings, formed part of his
    counterclaim against the LSUC in the civil action and were released by the
    appellant in the settlement of that action. They cannot be resurrected under an
    allegation of bad faith to found a claim for damages.

[32]

Similarly, the appellants
    allegations about the LSUCs unfair treatment of him during the trustee
    proceedings are nothing more than a re-litigation of the issues that he settled
    with the LSUC. Again, they cannot form the basis of any new claim for damages
    because the appellant could have raised them during the trustee proceedings.

[33]

While the appellant cannot claim
    damages arising out of the LSUCs conduct that he has released, he may refer to
    this conduct, if appropriate, as part of the narrative of the alleged pattern
    of bad faith conduct by the LSUC that the appellant alleges caused him damages.

[34]

At the hearing of the appeal, in
    addition to his argument about bad faith, the appellant asked that the appeal
    be heard as if he had amended paragraph 214 of his statement of claim to
    include allegations of breach of fiduciary duty and negligence against the LSUC,
    which were not raised before the motion judge, and to delete the particulars
    contained in the subparagraphs of 214 except for g, h, q, r, s, z, bb, cc, dd, and
    ee. The LSUC did not consent to these amendments. However, its counsel did not
    object to the appeal being considered as if those amendments had been made and
    the appeal proceeded on that basis.

[35]

For the reasons that follow, even
    taking into account the appellants proposed amendments that were not submitted
    to the motion judge, we find that there is no basis to grant the appellant
    leave to amend his pleading to include claims against the LSUC for breach of
    fiduciary duty and negligence.

[36]

The appellant has provided no
    particulars in support of his allegations that the LSUC owed to him a fiduciary
    duty in the performance of its administrative and regulatory duties. Moreover,
    none of the allegations contained in his presently drafted statement of claim
    would give rise to such a claim.

[37]

Similarly, the appellants
    proposed claim of negligence against the LSUC is  not supported by the allegations
    in his statement of claim. Rather, all of the factual allegations in the
    statement of claim relate to the appellants allegations of the LSUCs
    intentionally improper, dishonest, corrupt and illegal actions against him.

[38]

While the appellant should have
    been granted leave to plead properly the tort of misfeasance in public office,
    the appellants pleading as it presently stands is woefully deficient. The LSUC
    is entitled to know with particularity the case that it has to meet.

[39]

The appellant has not pleaded any
    of the requisite elements of any viable cause of action based on alleged bad faith
    conduct that may deprive the LSUC of its statutory immunity, nor with any
    precision the particulars that support these allegations, as required under the
Rules of Civil Procedure.
Since
    bad faith or dishonesty is an essential ingredient of the tort of misfeasance
    in public office, rule 25.06(8) requires that full particulars be pleaded:
Gratton-Masuy
, at para. 88-89.

Disposition:

[40]

For these reasons, the appellants
    appeal is allowed to grant him leave to permit him to serve and file within 60
    days of today a fresh as amended statement of claim to plead with proper
    particulars a tenable cause of action against the LSUC based on the tort of
    misfeasance in public office arising out of its alleged bad faith conduct in
    relation to the appellant.

[41]

The appellants fresh as amended
    statement of claim shall be subject to any applicable defences, including the
    application of any limitation periods, to a request for particulars, and to any
    further motions to strike or dismiss the fresh as amended claim, if warranted.

[42]

His appeal is otherwise dismissed.

[43]

The LSUC, and Mr. Levine if
    applicable, shall serve and file an amended statement of defence, a request for
    particulars, or a notice of motion to strike the fresh as amended claim and
    dismiss the action, within 45 days of receipt of the appellants fresh as
    amended statement of claim.

[44]

If the parties cannot agree on the
    disposition of costs of the appeal, including the motion below, they shall
    submit brief written submissions of no more than two pages, plus their respective
    costs outlines, as follows:  the appellant shall deliver his submissions within
    two weeks of today; the LSUC shall respond ten days thereafter.

Released: January 26, 2016

K.M. Weiler J.A.

K. van Rensburg
    J.A.

L.B. Roberts
    J.A.