COURT OF APPEAL FOR ONTARIO

CITATION: Royal Bank of Canada v. Stovel, 2014 ONCA 362

DATE: 20140505

DOCKET: C57837

Cronk, Watt and Strathy JJ.A.

BETWEEN

Royal Bank of Canada

Plaintiff (Respondent)

and

Mark Andrew Stovel

Defendant (Appellant)

Mark Stovel, in person

Natalie Marconi, for the respondent

Heard and released orally: April 17, 2014

On appeal from the order of Justice David G. Stinson of
    the Superior Court of Justice, dated July 9, 2013.

ENDORSEMENT

[1]

Royal Bank of Canada (RBC) obtained default judgment against the
    appellant for the unpaid balance owing on a credit card account. Several months
    later the appellant moved to set aside the default judgment. Unable to attend
    the hearing of his motion because of a family emergency, the appellant sent an agent
    to seek an adjournment of the motion. The motion judge dismissed the request
    for an adjournment and, after reviewing the material filed by the appellant in
    support of his motion, also dismissed the motion to set aside the default
    judgment.

[2]

The appellant appeals. He says that the motion judge erred in failing to
    grant his adjournment request and erred further in dismissing his motion to set
    aside the default judgment.

[3]

The appellant does not appear to dispute either the fact or extent of
    his indebtedness to RBC.

[4]

The appellant submits that the motion judge should have adjourned the
    hearing of his motion to set aside the default judgment to another date. The
    appellants failure to appear was as a result of a family emergency. It was
    apparent that his agent was not in a position to argue the merits of the
    motion. Refusal of the adjournment, the appellant submits, denied him access to
    justice.

[5]

Whether a request for an adjournment will be granted or refused is a
    matter that lies within the discretion of the judge presiding in the
    proceedings in which the application for adjournment is brought. That
    discretion, if exercised in accordance with the applicable legal principles,
    reasonably and with due regard to all the circumstances, is entitled to
    deference in this court. We observe that in refusing the adjournment request in
    this case, the motion judge also considered the merits of the appellants claim
    to set aside the default judgment. The motion judge considered that there was
    no basis advanced by the appellant upon which the default judgment could be set
    aside. We agree with that assessment and that it was properly a factor for the
    motion judge to take into account in determining whether an adjournment should
    be granted.

[6]

For these reasons, the appeal is dismissed. RBC is entitled to its costs
    of the appeal and of the motion for an extension of time in the total amount $1,000.00.

E.A. Cronk
    J.A.

David Watt
    J.A.

G.R.
    Strathy J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Sheppard International Trading Inc. v. Baghai, 2014
    ONCA 381

DATE: 20140512

DOCKET: C57578

Laskin, Rouleau and Lauwers JJ.A.

BETWEEN

Sheppard International Trading Inc.

Plaintiff (Appellant)

and

Shahab Baghai, also known as Shane Baghai,
Manda Baghai
, Shane Baghai Homes Inc., Baghai
    Developments Ltd.,
BBT Devgroup Inc., Reza Banai, Banai
    Management Inc., Mitra Banai, also known as Movasagh Nekoonam Banai, Tes
    Development Inc., Air Touch Inc., Siavash Taheri, Manouchehr Estifa and Bijan
    Shiekholeslami

Defendants (Respondents)

Douglas Christie, for the appellant

Kevin Sherkin and Jeremy Sacks, for the respondents

Heard: April 28, 2014

On appeal from the judgment of Justice A.J. OMarra of
    the Superior Court of Justice, dated July 29, 2013.

APPEAL BOOK ENDORSEMENT

[1]

The motion judge made findings of fact, which are well supported by the
    record.  In the light of those findings we see no error in the granting of summary
    judgment.

[2]

However, we are concerned about the motion judges award of substantial
    indemnity costs.  The parties did not make submissions on costs, and we are not
    persuaded of any basis for substantial indemnity costs.  Leave to appeal costs
    is granted, and an award of partial indemnity costs is substituted.  The appeal
    is otherwise dismissed with costs to the respondents of $10,000 all in.


COURT OF APPEAL FOR ONTARIO

CITATION:  Struik v. Dixie Lee Food Systems Ltd., 2014 ONCA
    433

DATE:  20140529

DOCKET: C57825

Doherty, Simmons and Tulloch JJ.A.

BETWEEN

Maria Struik

Plaintiff (Respondent)

and

Dixie Lee Food Systems Ltd., Dixie Lee of Canada Inc., Dixie Lee Capital
    Corporation, and Joseph Murano

Defendants (Appellants)

Raman Dhillon, for the defendants (appellants)

Robert J. Reynolds, for the plaintiff (respondent)

Heard and orally released:  May 23, 2014

On appeal from the judgment of Justice Varpio of the
    Superior Court of Justice, dated September 30, 2013.

ENDORSEMENT

[1]

There were essentially two issues on the motion for partial summary
    judgment which gives rise to this appeal.  One issue was referred to as the
    guarantee issue and the other as the priority issue.  The motion judge
    decided both in favour of the respondent.

[2]

Counsel for the appellant points to two findings of fact that she says
    were necessary to the resolution of the two issues outlined above.  Counsel
    argues that neither finding was appropriately made within the confines of a
    Rule 20 motion.

[3]

We disagree.

[4]

On the first factual finding  the timing of the appellants transfer of
    certain franchises  the trial judge found that the transfer occurred in
    January 2012 as represented in the documents effecting the transfer.  In making
    that finding, the motion judge considered and rejected the appellants bald
    assertion that the transfer had in fact been made years earlier:  see paras.
    31-33.

[5]

In our view, a finding of fact based on unambiguous documents, most of
    which were authored by the appellant or on his behalf, is an appropriate
    exercise of the motion judges powers under Rule 20, especially in the absence
    of any explanation for the obvious conflict between those documents and the
    appellants current version of events.  We note that the appellant declined the
    motion judges invitation to adjourn the motion so that he could file material
    said to exist that would support his position on this point.

[6]

The second finding of fact  that Systems and Capital were related
    companies, thus making both liable on the guarantee provision in the settlement
    agreement, was based on uncontradicted and overwhelming evidence: see paras.
    34-35.  We see no reason to interfere with this finding.

[7]

In our view, the findings made by the motion judge were properly made on
    a Rule 20 motion and his determination on the motion for partial summary
    judgment cannot be disturbed on appeal.

[8]

The motion judge also dismissed a cross-motion brought by the appellant
    in which the appellant argued that the settlement agreement, when properly
    interpreted, did not permit the respondent, upon a breach of the agreement by
    the appellant, to both exercise her right to take an assignment of certain
    other franchises and obtain a court order requiring continued payment of the
    amounts proscribed under the settlement agreement.

[9]

In dismissing the cross-motion, the motion judge read and interpreted
    the agreement according to its terms and in the context of the events as
    described in the material before him.  We see no error in his determination
    that he could properly engage in this interpretative exercise on a summary
    judgment motion.  We also agree with his interpretation of the remedial
    provisions in the settlement agreement.  Even if commercial unreasonableness
    could somehow provide a basis for interpreting an agreement in a manner that
    contradicted the plain meaning of the agreement, we see nothing commercially
    unreasonable in a party bargaining for multiple remedies upon the default by
    the other party to the agreement.

[10]

The
    appellant also challenges the costs order made by the motion judge.  Leave to
    appeal is necessary.  We see no reason to grant leave to appeal on the costs
    question.  Nothing in those reasons raises issues which, in our view, need to
    be addressed by this court.

[11]

The
    appeal is dismissed.

[12]

Costs
    to respondent granted in the amount of $12,500, inclusive of relevant taxes and
    disbursements.

Doherty J.A.

Janet Simmons J.A.

M. Tulloch J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Tarsitano v.
    Drutz, 2014 ONCA 351

DATE: 20140507

DOCKET: C57698

Juriansz, Tulloch and Strathy JJ.A.

BETWEEN

Mary Elizabeth Tarsitano and Laura Tarsitano and
    Emma Tarsitano, a minor by her Litigation Guardian, Mary Elizabeth Tarsitano

Plaintiffs (Appellants)

and

Dr. Harold Paul Drutz and Mount Sinai Hospital

Defendant (Respondent)

No one, for the appellant

Moya J. Graham, for the respondent

Heard: May 1, 2014

On appeal from the judgment of Justice Guy P. DiTamaso of
    the Superior Court of Justice, dated September 5, 2013.

APPEAL BOOK ENDORSEMENT

[1]

Order to continue the appeal of Emma Tarsitano.

[2]

The appeal is dismissed without costs on the consent of all the parties.


COURT OF APPEAL FOR ONTARIO

CITATION:  United States v. Aneja, 2014 ONCA 423

DATE:  20140526

DOCKET: C55716 & C56402

Doherty, Feldman and Lauwers JJ.A.

BETWEEN

The Attorney General of Canada on Behalf of the
    United States of America

Respondent

and

Jay Aneja

Appellant/Applicant

Edward L. Greenspan, Q.C. and Joseph S. Wilkinson, for
    the appellant

Faiyaz Amir Alibhai, for the respondent

Heard: March 19, 2014

On appeal from the committal order of Justice Thomas R. Lofchik
    of the Superior Court of Justice, dated July 10, 2012, with reasons reported at
    2012 ONSC 4062, and on application for judicial review of the surrender order
    of the Minister of Justice, dated December 12, 2012.

Doherty J.A.:

I

overview

[1]

In August 2011, the United States of America (the United States) requested
    the extradition of the appellant on various charges.  In July 2012, the
    extradition judge ordered the appellant committed for surrender on various
    charges.  In December 2012, the Minister of Justice (Minister) ordered the
    appellant surrendered to the United States on the charges for which he had been
    ordered committed for surrender.

[2]

The appellant appeals from the committal order and seeks judicial review
    of the Ministers surrender order.  In keeping with the practice of this court,
    the two matters were heard together.

[3]

On the appeal from the committal order, counsel submits that the
    extradition judge erred in refusing to admit evidence tendered by the defence
    to support the contention that the evidence relied upon by the United States in
    support of its request for extradition was unreliable and could not justify
    committal for surrender.  Counsel submits that the evidence proffered by the
    defence tended to show that the evidence of the two accomplices relied on by
    the United States was not credible.  Counsel submits that the extradition judge
    should have admitted the evidence, and gone on to determine whether the
    totality of the evidence on the hearing justified the appellants committal for
    surrender.  The appellant seeks a new extradition hearing at which his evidence
    can be received and the question of committal determined by reference to that
    evidence as well as the evidence relied on by the United States.

[4]

On the judicial review application, counsel focuses on the disparity
    between the length of the jail sentence the appellant will face if convicted in
    the United States of the charges and the length of the jail sentence a person
    would face in Canada if convicted of the comparable offences.  Counsel argues
    that the disparity between the two is so great that the surrender of the
    appellant to face a draconian sentence in the United States would shock the
    conscience of the reasonably informed observer.  Counsel submits that the
    surrender of the appellant absent assurances by the United States authorities to
    the Canadian government that the appellant would receive a sentence comparable
    to the sentence that would be imposed in Canada contravenes s. 7 of the
Charter
and is an unconstitutional exercise of the Ministers discretion.

[5]

For the reasons that follow, I would dismiss both the appeal and the
    application for judicial review.

II

the charges

[6]

The extradition request by the United States sought surrender on several
    offences:

·

Arson and fraud-related charges arising out of a fire in August
    2008 at the business operated by the appellant and his subsequent insurance
    claim for damages caused by the fire.

·

An obstruct justice charge arising out of an alleged misrepresentation
    made by the appellant to an FBI agent in the course of the investigation of the
    fire.  It was alleged that the appellant falsely represented that he was an
    American citizen.

·

A firearm charge arising out of an event in February 2008.  The
    appellant allegedly gave a pistol to Michael Lee, a person whom he knew to be a
    felon.

[7]

The authority to proceed issued by the Minister identified the
    corresponding Canadian offences as:

·

arson for a fraudulent purpose contrary to s. 435 of the
Criminal
    Code
;

·

fraud contrary to s. 380 of the
Criminal Code
;

·

obstructing justice contrary to s. 139 of the
Criminal Code
;
    and

·

unauthorized possession of a firearm contrary to s. 91 of the
Criminal
    Code
.

[8]

The extradition judge ultimately ordered the appellant committed on:

·

arson for a fraudulent purpose;

·

attempted fraud; and

·

unauthorized possession of a firearm.

[9]

The extradition judge committed on the charge of attempted fraud rather
    than fraud because the insurance company did not actually make any payment on
    the claim.  He declined to commit on the obstruct justice charge because he
    concluded that the appellants misrepresentation did not relate to the subject
    matter of the investigation.

[10]

The
    respondent does not challenge the extradition judges refusal to commit the appellant
    on the obstruct justice charge, or his decision to commit the appellant on the
    charge of attempted fraud rather than fraud.

III

the requesting states evidence

[11]

The
    record of the case (ROC) submitted on behalf of the United States consisted
    of an initial record and three supplemental records containing a summary of the
    anticipated evidence relied on by the U.S. authorities.  The evidence was
    certified pursuant to s. 33 of the
Extradition Act
, S.C. 1999, c. 18 (the Act), a
s both
    available and sufficient to justify prosecution in the United States.  The ROC included
    summaries of the anticipated evidence of Michael Lee and Sidney Terry, who,
    according to the U.S. authorities, were hired by the appellant to set the
    fire.  I will summarize the parts of the ROC that relate to the arson/fraud
    charges first and then summarize the part of the ROC concerning the gun charge.

(a)

The Arson/Fraud Charges

[12]

On
    Sunday, August 3, 2008, a fire occurred at Sofa Outlet Inc. (Sofa Outlet), a
    furniture store in Roanoke, Virginia.  The fire caused more than $800,000
    damage to the Sofa Outlet and other stores located in the same plaza.
    Investigation determined that the fire was intentionally set.

[13]

Sofa
    Outlet was operated by the appellant.  Business was bad in August 2008.

[14]

Whoever
    set the fire entered and left the Sofa Outlet premises without setting off the security
    alarm.  The alarm was activated by the fire personnel when they arrived in
    response to the call.  The appellant was one of four persons who had the codes
    needed to activate and deactivate the alarm.

[15]

Sofa
    Outlet is nominally owned by the appellants stepmother, but she has never had
    anything to do with the business.  The appellant operated the business, made
    all business-related decisions and received any proceeds generated from the
    business.  The appellant filed a Proof of Claim with Sofa Outlets insurer,
    seeking compensation for the damages caused by the fire.  Any proceeds that may
    have been paid on the insurance claim would have been available to the appellant.

[16]

Michael
    Lee had pled guilty to certain charges arising out of the arson and was serving
    a lengthy jail sentence.  According to the ROC, he was available and willing to
    testify against the appellant.

[17]

Mr.
    Lee, a convicted felon, met the appellant in February 2008 and did some work
    for him at the Sofa Outlet warehouse.  In late July 2008, the appellant
    approached Lee and told him that his store was not doing very well.  He offered
    to pay Lee to burn the store down so that the appellant could make an insurance
    claim.  Lee agreed to do so.

[18]

The
    appellant gave Lee the key to the store and the code for the security system.
    He told Lee to make it appear as though the store had been vandalized and then
    set on fire by the vandals.

[19]

Lee
    recruited Sidney Terry and Jason Varona to help him.  On Saturday, August 2
nd
,
    they went to the Sofa Outlet store and entered using the key the appellant had
    given Lee.  Lee deactivated the security system with the code given to him by
    the appellant.  The three men loaded some of the Sofa Outlet inventory into a
    truck and drove it to Richmond, Virginia intending to sell the inventory on the
    street.  Lee also took some business records from the office that the appellant
    had told him he wanted removed before the fire was set.

[20]

Lee
    and Terry, but not Varona, returned to the Sofa Outlet store on Sunday
    afternoon, August 3, 2008.  Once again, they entered using the key the
    appellant had given to Lee and Lee disarmed the security system using the code
    the appellant had given to him.  Lee and Terry then relaxed for a while, drinking
    a beer, having a cigarette and taking a nap.  After they awoke, the two men proceeded
    to spread accelerant around the store.  They started fires in several places
    within the building.  Lee reset the security system and the two men left the
    store locking the door behind them.

[21]

Lee
    received some money from the appellant.  He also received a credit card with a $12,000
    limit.  Lee passed a small amount of money on to Terry.

[22]

Terry,
    like Lee, was serving a sentence for offences relating to the arson.  He was
    also available and willing to testify.  His anticipated evidence was similar in
    most respects to Lees anticipated evidence.  According to Terry, he initially believed
    that he was only there to help Lee remove inventory from the store and take it
    to Richmond, Virginia for a midnight auction.  On Terrys anticipated
    evidence, the appellant was party to the fraudulent removal of the inventory on
    Saturday evening.

[23]

Terry
    first learned of the plan to burn the building while removing furniture from
    the building on Saturday, August 2
nd
.  Apparently, Lee had planned
    to set the store on fire immediately after they removed the furniture.  Terry
    pointed out that as they would be taking the furniture to Richmond in a Sofa
    Outlet truck, it would be wise to wait until the next day to set the fire.  Lee
    agreed.  Terry recounted a conversation in which Lee explained to the appellant
    why the fire had not been set immediately after the property was removed from
    the store.

[24]

Terry
    and Lee returned to the store on Sunday, August 3
rd
.  He and Lee set
    the fire and left the building after Lee had reset the alarm.  Lee locked the
    door as they left the store.

(b)

The Gun Charge

[25]

The
    anticipated evidence relating to the firearm charge comes exclusively from
    Lee.  According to the ROC, in February 2008, he told the appellant that he had
    just spent 20 years in prison.  A short time later, the appellant gave Lee a
    pistol telling him to [d]o something with it.  Lee was arrested in possession
    of the pistol about a month later in March 2008 and charged with the offence of
    being a felon in possession of a firearm.  The firearm was operational.

IV

the evidence proffered by the appellant

[26]

At
    the extradition hearing, counsel sought to introduce various documents under s.
    32(1)(c) of the
Act
.  The
    material came largely from the U.S. authorities and court records in the United
    States.  The material included statements made by Lee and Terry to the investigators,
    transcripts of court proceedings, including Grand Jury testimony, transcripts
    of sentencing proceedings, other court documents, criminal records, and
    statements made by the appellant to the U.S. investigators.  Most of the
    material was said to be relevant to the credibility of Lee and Terry and,
    therefore, to the reliability of the parts of the ROC that summarized their
    anticipated evidence.
[1]

[27]

The
    material relating to Lee was extensive.  The relevant parts can be summarized
    as follows:

·

Lee and Terry initially agreed to deny any involvement in the
    fire.

·

When Lee was first questioned a few days after the fire, he in
    fact denied any involvement in the fire.

·

Lee first admitted his involvement in the fire some four months
    later in December 2008.

·

Lees statements to the authorities and his Grand Jury testimony
    contained some inconsistencies as to the details of the events surrounding the
    fire.

·

Lee has an extensive and serious criminal record.

·

Lee entered into a plea arrangement with the authorities.  In
    exchange for his cooperation in the prosecution of the appellant, Lee received
    a sentence totalling 14 years as opposed to the sentence of at least 20 years
    that he would have received but for his cooperation.

·

In respect of the gun charge, Lee made no reference to the
    appellant having given him the gun in February 2008 until December 2008 when Lee
    decided to cooperate with the authorities on the arson charge.

·

There were some inconsistencies in the various statements made by
    Lee about the circumstances in which the appellant came to give him the gun.

[28]

The
    material relating to Terry was also quite extensive and revealed the following:

·

Terry and Lee had initially agreed they would deny any
    involvement in the fire.

·

Terry initially denied any involvement in the fire.

·

Terry subsequently chose to cooperate with the authorities in
    exchange for a reduced sentence.  He eventually received a sentence of 20
    months.

·

Terry had a minor criminal record.

·

Terrys various statements and Grand Jury testimony contain some
    inconsistencies.

[29]

The
    admissibility of the documents turned on whether the material was relevant to
    the test for committal in s. 29(1) of the Act.  The extradition judge described
    the issue in these terms, at para. 26:

Could the evidence sought to be admissible render the
    evidence proffered by the requesting state so defective or unreliable as to
    lead to the conclusion that it would be unsafe or dangerous to convict or
    necessary to withdraw the case from a jury,
or does it just raise issues of
    credibility that will have to be decided by the trier of fact?
[2]
[Emphasis added.]

[30]

The
    extradition judge concluded, at para. 44:

The fact that the requesting state relies on evidence of
    accomplices who made plea bargains goes to the weight of the evidence and does
    not render the evidence manifestly unreliable.  The weight of the evidence is a
    matter for the trial judge in the requesting state.  The cases referred to
    above deal with the interrelationship of principles expressed in
Ferras
.
[3]

Each case confirms that in order to be relevant, such evidence to be called
    must be directed to either demonstrating fundamental inadequacies and frailties
    in, or to make manifestly unreliable, the evidence of the requesting state.  In
    this case the evidence which the person seeks to lead does not achieve those
    objects.  In my view this evidence, if received by the court, would not
    fundamentally undermine the reliability of the evidence from the requesting
    state
or change the analysis of the record of the case.  The points raised
    go to credibility.  [Emphasis added.]

V

the appellants arguments

A:  Did the extradition judge conflate the test governing the
    admissibility of evidence with the ultimate test governing committal for
    surrender?

[31]

As
    explained above, counsel for the appellant relied on s. 32(1)(c) of the Act in
    seeking the admission of the material on the extradition hearing.  That section
    provides for the admission of evidence adduced by the person sought for
    extradition if the evidence is reliable and relevant to the tests set out in
    subsection 29(1).  There was no dispute about the reliability of the material
    tendered by the appellant.  The admissibility of the material depended on its
    relevance to the test for committal found in s. 29(1)(a) of the Act.

[32]

Section
    29(1)(a) of the Act directs that the extradition judge should order committal for
    surrender if:

there is evidence admissible under this Act of conduct that,
    had it occurred in Canada, would justify committal for trial in Canada on the
    offence set out in the authority to be proceed

[33]

Ferras
holds that committal is justified under s. 29(1)(a) only if there is evidence
    of the existence of each element of the offence on which surrender is sought that
    would allow a reasonable, properly instructed jury to convict were it trying
    the case in Canada:
Ferras
, at para. 46.

[34]

The
    test for committal in
Ferras
requires the extradition judge to engage
    in a limited weighing of evidence to determine whether there is a plausible
    case.  Chief Justice McLachlin explained, at para. 54:

The ultimate assessment of reliability is still left for the
    trial where guilt or innocence are at issue.  However, the extradition judge looks
    at the whole of the evidence presented at the extradition hearing and
    determines whether it discloses a case on which a jury could convict.  If the
    evidence is so defective or appears so unreliable that the judge concludes it
    would be dangerous or unsafe to convict, then the case should not go to a jury
    and is therefore not sufficient to meet the test for committal.

[35]

Finally,
    in addressing the nature of the extradition judges power under s. 29(1) of the
    Act, the Chief Justice said, at para. 59:

Simply put, the extradition judge has the discretion to give no
    weight to unavailable or unreliable evidence when determining whether committal
    is justified under s. 29(1).

[36]

In
    providing for a limited weighing of the evidence,
Ferras
departed from
    earlier case law addressing the test for committal under s. 29(1)(a) of the Act.
    The extent to which
Ferras
contemplated a weighing of the evidence was
    discussed at length by this court in
United States of America v. Thomlison
,
    2007 ONCA 42, 216 C.C.C. (3d) 97, leave to appeal to S.C.C. refused, [2007]
    S.C.C.A. No. 179; and
United States of America v. Anderson
, 2007 ONCA
    84, 218 C.C.C. (3d) 225, leave to appeal to S.C.C. refused, [2007] S.C.C.A. No.
    159.  In
Anderson
, at para. 30, this court explained the limited
    weighing of the evidence enunciated in
Ferras
:

Evidence may be rendered so defective or so unreliable as
    to warrant disregarding it due to problems inherent in the evidence itself,
    problems that undermine the credibility or reliability of the source of the
    evidence, or a combination of those two factors.
I would stress, however, that
    it is only where the concerns with respect to the reliability of the evidence,
    whatever the source or sources, are sufficiently powerful to justify the
    complete rejection of the evidence, that these concerns become germane to the
    s. 29(1)(a) inquiry.
[Emphasis
    added.]

[37]

Counsel
    for the appellant submits that if the party sought for extradition tenders
    reliable evidence that has the potential to impeach the reliability of evidence
    in the ROC, the extradition judge is obliged to admit the evidence and consider
    it in the course of engaging in the limited weighing of the evidence contemplated
    in
Ferras
: see
United States of America v. Wilson
, 2011 BCCA
    514, 281 C.C.C. (3d) 15, at para. 37.  Counsel submits that the proffered
    evidence obviously had the capacity to impeach the credibility of Lee and Terry
    and, therefore, the reliability of parts of the ROC.  He argues that this was
    enough to warrant the admission of the evidence and its consideration along
    with the ROC in determining the question of committal under s. 29(1)(a).

[38]

I
    agree that there is a difference between the relevance of evidence to the test
    for committal under s. 29(1)(a) and, hence, its admissibility under s. 32(1)(c),
    and the ultimate question of whether the totality of the evidence justifies
    committal under s. 29(1)(a).
[4]

Wilson
, relied by the appellant, demonstrates the distinction.  In
Wilson
,
    the requesting state relied on summaries of conversations in which
    misrepresentations were made to the alleged victims of the fraud by employees
    of the person who was the subject of the extradition request.  At the
    extradition hearing, that person sought to introduce actual recordings of some
    of those conversations, alleging that the conversations would contradict the
    summaries in the ROC.  The extradition judge refused to admit the recordings
    into evidence.  The British Columbia Court of Appeal, at para. 37, held that the
    conversations should have been admitted and considered in determining the
    question of committal:

Where evidence is tendered that would tend to impeach the
    reliability of the ROC, the judge must consider that evidence and engage in a
    limited weighing of it to determine the sufficiency of the evidence for
    committal for trial.
That function is at the heart of a fair and
    meaningful judicial process.  [Emphasis added.]

[39]

The
    recordings tendered in
Wilson
went directly to the existence of the
    misrepresentations, the
actus reus
of the alleged fraud.  Depending on
    the content of those recordings, they could have rendered the parts of the ROC purporting
    to summarize the misrepresentations so unreliable as to warrant their outright
    rejection.  The approach of the British Columbia Court of Appeal in
Wilson
is consistent with that taken in
Anderson
, at paras. 44-45; see also
United
    States of America v. Pannell
, 2007 ONCA 786, 227 C.C.C. (3d) 336, at para.
    23.

[40]

This
    case is, however, quite different from
Wilson
.  Here, the question of
    the admissibility of the material tendered by the appellant under s. 32(1)(c)
    and the test for committal under s. 29(1)(a) merged for all practical purposes into
    a single question.  I will explain why.

[41]

The
    ROC contained direct evidence in the form of the anticipated testimony of Lee
    and Terry, as well as circumstantial evidence implicating the appellant in the
    arson/fraud charges.  The gun charge depended entirely on the direct evidence
    of Lee implicating the appellant in his possession of the gun.  Taken at face
    value, the evidence summarized in the ROC fully justified the appellants surrender
    on the arson/fraud charges and the gun charge.  The appellant could avoid
    surrender only by producing evidence that demonstrated the unreliability of
    some part of the ROC that was essential to committal.  He proposed to do so by
    adducing material that challenged the credibility of Lee and Terry.

[42]

The
    evidence tendered by the appellant had a single purpose.  The evidence was offered
    to show that, for the reasons identified in the material, Lee and Terry were
    not credible and that the parts of the ROC that relied on their anticipated evidence
    were, therefore, unreliable and could not justify a committal.  The success of
    the appellants argument depended entirely on whether the credibility-related factors
    identified in his material rendered the anticipated evidence of Lee and Terry so
    clearly unreliable as to warrant its outright rejection by the extradition
    judge.  This argument stood or fell on the material proffered by the
    appellant.  That material either did or did not establish the requisite level of
    unreliability.  This was not a case in which the extradition judge could not
    fully appreciate the potential impact of the evidence on the ROC when it was
    proffered by the appellant.

[43]

In
    my view, because of the nature of the evidence offered by the appellant and the
    argument made as to the potential relevance of that evidence to the question of
    committal, the admissibility question under s. 32(1)(c) and the ultimate
    question of whether committal was justified were essentially the same question
     did the proffered material demonstrate the manifest unreliability of the
    anticipated evidence of Lee and Terry as summarized in the ROC?  If the
    evidence did not have that effect, committal followed regardless of whether the
    evidence was said to be inadmissible, or admissible but inadequate to the task
    of demonstrating the manifest unreliability of evidence in the ROC.

[44]

While
    strictly speaking, I think the extradition judge was wrong in characterizing
    the issue as one of admissibility, that characterization did not prejudice the
    appellant in any way.  Had the extradition judge applied
Wilson
and admitted
    the evidence as tending to affect the reliability of the evidence in the ROC,
    he would still, on an application of
Thomlison
and
Anderson
, have
    determined that the proffered evidence did not warrant the rejection of any
    part of the ROC.  The result would have been exactly the result arrived at by
    the extradition judge  the committal for surrender of the appellant.

[45]

The
    approach taken by the extradition judge finds support in the analysis in
United
    States of America v. U.S.
,
2013 BCCA 483, 303 C.C.C. (3d) 541.  In that case, the subject of the
    extradition request sought to tender evidence on the extradition hearing demonstrating
    that for various reasons, the complainant, whose anticipated evidence was
    summarized and relied on in the ROC, was not a credible witness.  The Court of
    Appeal, at paras. 38-39, upheld the extradition judges refusal to admit that
    evidence:

The evidence the appellant sought to introduce at the
    extradition hearing did not contradict or wholly undermine the proposed
    testimony of S.S. [the complainant].  The proffered evidence simply raised
    circumstances that could cast doubt on the credibility of S.S.  The assessment
    of S.S.s credibility is for the trial in Louisiana.  It is not the function of
    the extradition judge to assess her credibility and determine whether the
    appellant is guilty.
Rather, the extradition judge is to determine
    whether there is sufficient evidence upon which a jury could return a guilty
    verdict.

If the evidence sought to be introduced demonstrated that the
    summarized evidence of S.S. was manifestly unreliable, then it would have been
    admissible to establish there was no plausible case against the appellant. The
    extradition judge considered the proffered evidence and concluded that none of
    it demonstrated S.S.s evidence to be manifestly unreliable.  In my view, the
    judge did not err in that regard.   [Emphasis added.]

[46]

In
U.S.
, as in this case, the nature of the evidence tendered was such that
    its relevance to the test for committal and the ultimate question of whether
    committal was justified merged into a single question.

B: Are
Thomlison
and
Anderson
wrongly
    decided?

[47]

In
    deciding whether to order the committal under s. 29(1)(a) of the Act, the
    extradition judge applied, as he was obligated to do, this courts judgments in
Thomlison
and
Anderson
.
In those cases, the court considered, at length, the extent to which the
    extradition judge could weigh the evidence in considering the question of
    committal.  In
Anderson
, at paras. 30-31, the court said:

Evidence may be rendered so defective or so unreliable as
    to warrant disregarding it due to problems inherent in the evidence itself,
    problems that undermine the credibility or reliability of the source of the
    evidence, or a combination of those two factors.
I would stress, however,
    that it is only where the concerns with respect to the reliability of the
    evidence, whatever the source or sources, are sufficiently powerful to justify
    the complete rejection of the evidence, that those concerns become germane to
    the s. 29(1)(a) inquiry.

In deciding whether defects in the case proffered by the
    requesting state are sufficiently serious to justify disregarding some part of
    the evidence relied on by the requesting state when conducting the s. 29(1)(a)
    assessment, an extradition judge must begin from the premise that the material
    properly certified by the requesting state pursuant to s. 33 is presumptively
    reliable for the purposes of the
Extradition Act
, including the s. 29(1)(a)
    assessment:  see
U.S.A. v. Ferras
,
supra
, at paras. 52-56.
    The party resisting extradition
may rebut the presumption of reliability
    flowing from certification either by reference to the requesting partys own material
    or by calling evidence to demonstrate fundamental inadequacies or frailties in
    the material relied on by the requesting state:
see
U.S.A. v. Ferras
,
    at paras. 66-67. [Emphasis added.]

[48]

As interpreted in
Anderson
and
Thomlison
, s. 29(1)(a) provides for a limited review of the
    evidence.  Where the ROC on its face justifies committal for surrender, the subject
    of the extradition can successfully challenge that evidence only by showing that
    some part or parts of the ROC essential to committal should be completely
    rejected as unreliable.  It is not enough to show that there is good cause to
    doubt the reliability of some part of the ROC, or that evidence relied on in the
    ROC might well be eventually rejected at trial: see
Anderson
, at paras. 28, 46.

[49]

Applying
Anderson
to this case, the involvement of
Terry
    and Lee in the arson, their lies to the authorities, their plea bargains, their
    criminal antecedents, and their inconsistent statements were all matters that, while
    relevant to their ultimate credibility, could not justify the outright
    rejection of the parts of the ROC summarizing their anticipated evidence.
    Those factors are the kinds of considerations that are inevitably left to triers
    of fact to assess based on
viva voce
evidence and a full hearing.  The
    extradition judges ultimate ruling, while wrongly characterized as an
    admissibility ruling, is faithful to the
ratio
of
Anderson
and
Thomlison
.

[50]

Counsel
    for the appellant submits that
Anderson
and
Thomlison
are
    wrongly decided in that they create an unworkable rule of admissibility for
    evidence tendered by the person sought for extradition, and they mischaracterize
    and unduly restrict the authority to weigh evidence under s. 29(1)(a) of the
    Act, recognized in
Ferras
as essential to maintaining the constitutionality
    of the extradition scheme set out in the Act.  Counsel urges the court to
    reconsider those cases.  I would reject this argument for several reasons.

[51]

First, and apart from
    the merits of
Thomlison
and
Anderson
, I do not
    see this as an appropriate case in which to reconsider the correctness of those
    decisions.  Everyone accepts that
Ferras
contemplates only a limited weighing of the evidence
    by the extradition judge.  To my knowledge, the furthest any case has gone in
    describing the extent to which the evidence should be weighed is to equate the
    extradition judges function with that of an appellate court when considering
    the reasonableness of a verdict under s. 686(1)(a)(i) of the
Criminal
    Code
:
see
United States
    of America v. Graham
, 2007 BCCA 345, 222 C.C.C. (3d) 1, at paras. 31-32,
    leave to appeal to S.C.C. refused, [2007] S.C.C.A. No. 467; and
United
    States of America v. Bennett
,
2014 BCCA 145, at para. 19.
[5]

In my view, even if one applies the
    unreasonable verdict standard to the evidence in the ROC, this committal order
    could not be successfully challenged.

[52]

The case against the
    appellant on the arson/fraud charges as described in the ROC is particularly
    strong.  That case does not depend, as counsel for the appellant suggested,
    only on the anticipated evidence of the accomplices, Terry and Lee.  Their
    evidence is supported by formidable evidence of the appellants strong
    financial motive and equally strong evidence that the fire was an inside
    job.  The circumstantial evidence points the finger of guilt at the
    appellant.  An appellate court, properly applying the unreasonable verdict standard,
    could not interfere with convictions on the arson/fraud charges based on the
    evidence in the ROC.

[53]

The case against the
    appellant is weaker on the gun charge.  That charge does depend on the
    uncorroborated evidence of Lee.  The timing of his revelation of the
    appellants involvement with the gun is clearly suspicious.  Lee said nothing
    to implicate the appellant in the gun charge until many months after he was
    charged and shortly before he was scheduled to go to trial on that charge.  He
    implicated the appellant in the arson at the same time.

[54]

Despite the obvious potential difficulties with the
    credibility of Lees evidence, a jury would be entitled in Canada to convict on
    his evidence even if unconfirmed.  If a jury did convict, and had received a proper
    caution as to Lees evidence, I do not see how an appellate court, based only
    on the obvious difficulties with Lees credibility, could reverse that
    conviction as unreasonable under s. 686(1)(a)(i).

[55]

Second, the appellants arguments in favour of overruling
Thomlison
and
Anderson
misread those cases.  The appellant reads
Thomlison
and
Anderson
as creating a rule of admissibility governing evidence
    tendered by the subject of an extradition request pursuant to s.
32(1)(c).  In reality, those cases are principally
    concerned with describing the extent to which the extradition judge can weigh
    evidence in deciding whether that evidence justifies committal under s.
    29(1)(a) of the Act.  Specifically, those cases are concerned with the extent
    to which material in the ROC supporting committal can be rejected on the basis that
    it lacks reliability.

[56]

Anderson
also
    speaks to a procedural question, namely, the manner in which the extradition
    judge can control the presentation of evidence by the subject of the
    extradition.
Anderson
makes it clear that the extradition judge
can
, where the circumstances dictate, take appropriate
    steps to determine both the substance of the proposed evidence tendered by the
    subject of the extradition request and the relevance of that proffered evidence
    to a matter that is properly the subject of consideration on the committal
    hearing.  These powers, which are not unique to an extradition judge, are not
    rules of admissibility but are rather procedures that a judge may implement to control
    proceedings in which questions of admissibility must be resolved.

[57]

When
Thomlison
and
Anderson
are properly understood as describing the limited
    weighing function assigned to the extradition judge under s. 29(1)(a), the
    appellants arguments that
those cases
create an unworkable rule of admissibility fall by the wayside and
    cannot warrant a re-examination of the correctness of those cases.

[58]

Third, I am not persuaded that
Thomlison
and
Anderson
should be overruled.  This court can overrule its own jurisprudence:
[6]
see
David Polowin Real Estate Ltd. v. Dominion of Canada General Insurance
    Co.
(2005), 76 O.R. (3d) 161 (C.A.), leave to appeal to S.C.C. refused,
    [2005] S.C.C.A. Nos. 388-95;
Green v. Canadian Imperial Bank of Commerce
,
    2014 ONCA 90, 118 O.R. (3d) 641, at paras. 15 and following.
[7]
When asked to overrule a prior decision, this court looks both to the merits of
    that earlier decision and the policy implications of overruling that decision:
    see
Polowin
, at paras. 118-145.

[59]

I see nothing in the present legal landscape that
    would call for a reconsideration of this courts interpretation of
Ferras
in
Thomlison
and
Anderson
.  Leave to appeal to the Supreme Court of Canada was
    refused in both
Thomlison
and
Anderson
: [2007] S.C.C.A.
    No. 179, and [2007] S.C.C.A. No. 159, respectively.  Both cases have been
    repeatedly applied by this court without apparent difficulty: see
e.g.
,
United States of America v.
    Orphanou
, 2011 ONCA 612, 107 O.R. (3d)
    365, at para. 35;
Pannell
,
at para. 20
;
United States of America v. Michaelov
,
    2010 ONCA 819, 264 C.C.C. (3d) 480, at paras. 46-47, leave to appeal to S.C.C.
    refused, [2011] S.C.C.A. No. 37;
France v. Diab
, 2014 ONCA 374, at
    para. 129.  They have also been applied in other provinces: see
e.g.
,
United
    States of America v. M.M.
, 2012 QCCA 1142, [2012] Q.J. No. 5896, at paras.
    10 and 17;
United States of America v. Edwards
, 2011 BCCA 100, 271
    C.C.C. (3d) 471, at paras. 31-32.  Nor, in my view, have there been any
    developments, either in the related jurisprudence or legislatively, that would
    cast any doubt on the correctness of the approach articulated in
Thomlison
and
Anderson
.

[60]

As
    acknowledged in
Thomlison
, at paras. 39-45, the proper interpretation
    of
Ferras
is open to legitimate debate.  As noted above, at least two
    cases in the British Columbia Court of Appeal favour a somewhat broader power
    to weigh the evidence under s. 29(1)(a) of the Act, akin to the scope of
    appellate review of the reasonableness of a trial verdict under s. 686(1)(a)(i)
    of the
Criminal Code
:
Graham
, at paras. 31-32; and
Bennett
,
at para. 19.  For the reasons in
Diab
,
    at paras. 139-40, I favour the approach in
Thomlison
and
Anderson
.
    That approach is more consistent with the nature of the extradition process and
    the role of the committal hearing in that process.  Extradition hearings are
    preliminary proceedings.  They are not trials and cannot be allowed to take on
    the features of a Canadian domestic trial.  A level of review of fact-finding
    that is appropriate to an after-the-fact assessment of an entire trial record,
    as contemplated by s. 686(1)(a)(i), is not applicable to the function performed
    by the extradition judge when determining the question of committal under s. 29(1)(a).
    While an appellate court could well determine whether a reasonable trier of
    fact could believe the evidence of Lee and Terry having regard to the entirety
    of a trial record, I do not see how an extradition judge could make that kind
    of ultimate assessment of their credibility based on the limited paper record
    available at a committal hearing.

[61]

As the Chief Justice explained in
Ferras
, at paras.
    41-49, s. 7 of the
Charter
demands
    that an extradition judge weigh to some extent the evidence tendered at the
    committal hearing.  That weighing process is intended to ensure that persons
    are not surrendered for extradition on the basis of evidence that is
    demonstrably unreliable.  Surrender in those circumstances would offend the
    principles of fundamental justice.  The s. 7 protection does not, however,
    extend to preclude committal where there is reason to doubt the ultimate
    reliability of the evidence or its ultimate probative value.  Those questions are
    left for the tribunal responsible for determining guilt and innocence:
Ferras
, at para. 54.

[62]

I would not reverse
Thomlison
and
Anderson
.  I would dismiss the appeal from the committal
    order.

VI

the judicial review application

[63]

Counsel
    made only one argument in his oral submissions challenging the Ministers
    surrender order.  He submits that under the American sentencing regime, the
    appellant will receive a minimum sentence of 15 years on the fraud/arson
    charges plus a potential consecutive sentence of up to 10 years on the gun
    charge.  Counsel submits that the appellant, if convicted of the charges, will
    receive sentences totalling 20 years or more.  He compares that sentence to the
    three to five-year total sentence the appellant would likely receive if
    convicted of the comparable offences in Canada.

[64]

Counsel argues that surrender to face a sentence that is at
    least 15 years longer than the appellant would face in Canada must shock the
    conscience of the reasonable member of this community.  Surrender to face those
    sentences, therefore, violates the appellants rights under s. 7 of the
Charter
unless the Minister obtains assurances from the
    United States that any sentence imposed on the appellant would be consistent
    with comparable Canadian sentences.

[65]

This same submission was
    made to the Minister and he considered it in his reasons ordering the appellants
    surrender.  The Minister appreciated the submission and his obligation to
    consider whether a surrender order in the face of a potential sentence well in
    excess of any sentence that the appellant would face in Canada would violate s.
    7 of the
Charter
.  In
    making that determination and exercising his discretion, the Minister considered
    the relevant jurisprudence.  Many cases have addressed this exact issue.  The
    case law supports the Ministers conclusion that the potential sentence faced
    by the appellant in the United States, whether considered on its own or
    compared to the potential sentence in Canada, did not render his surrender
    contrary to the principles of fundamental justice.

[66]

I will not review the
    case law in detail.  Reference to three cases adequately demonstrates the
    reasonableness of the Ministers decision.  In
United States of
    America v. Jamieson
, [1996] 1 S.C.R.
    465, revg (1994), 93 C.C.C. (3d) 265 (Que. C.A.), a unanimous Supreme Court of
    Canada upheld an order surrendering a 26-year-old man to the state of Michigan
    to face a 20-year minimum sentence for trafficking in cocaine.  In
United
    States of America v. J.H.K.
(2002),
    165 C.C.C. (3d) 449 (Ont. C.A.), leave to appeal to S.C.C. refused, [2002]
    S.C.C.A. No. 51, this court upheld a surrender order in the face of a mandatory
    life sentence with no parole for 25 years on a charge of sexually assaulting a
    child.  In
U.S.
, the
    British Columbia Court of Appeal upheld a surrender order in the face of a
    mandatory minimum 25-year sentence on charges of sexually assaulting a child
    and making child pornography.

[67]

In the cases cited above
     and there are others  the difference between the sentence faced in the
    United States and the comparable sentence in Canada was greater than the no
    doubt substantial disparity that exists in this case.  In light of this
    jurisprudence, it cannot be said that the surrender of the appellant, without
    the requested assurances, would shock the conscience of the reasonably
    informed observer.  Surrender is not a violation of the appellants s. 7
    rights.  There is no other basis in this record upon which the court could
    interfere with the Ministers exercise of his discretion to order the surrender
    of the appellant.

[68]

I would dismiss the
    application for judicial review.

RELEASED: MAY 26 2014  DD

Doherty J.A.

I agree K. Feldman
    J.A.

I agree P. Lauwers
    J.A.

[1]
In addition to the evidence relating to Lee and Terry, the appellant also
    sought to introduce evidence of a statement and the Grand Jury testimony of
    Jason Varona.  The extradition judge did not admit that evidence.  That
    evidence is not relied on for the purposes of the appeal.

Counsel also sought to introduce documents obtained
    from the American authorities containing statements the appellant had made to
    the investigators to the effect that he was not an American citizen.  The
    extradition judge admitted this evidence and declined to commit on the related
    charge.  This evidence is not in issue on the appeal.

[2]
The extradition judges reasons are reported as
United States of America v.
    Aneja
, 2012 ONSC 1674.

[3]

United States of America v. Ferras; United States of America v. Latty
,
    2006 SCC 33, [2006] 2 S.C.R. 77.
Ferras
is discussed below.

[4]
I think the extradition judge also recognized the distinction.  He admitted
    certain material referable to the obstruct justice charge on the basis that it
    could have the effect of making the case on the obstruction of justice charge
    manifestly unreliable (at paras. 39-40).

[5]
An application for leave to appeal to the S.C.C. has been filed in
Bennett
.

[6]
The appellant, in keeping with this courts practice where a party seeks to
    overrule a prior decision, sought a five-judge panel.  That request was denied.

[7]
Applications for leave to appeal to the S.C.C. have been filed for the three
    cases decided in
Green
.


COURT OF APPEAL FOR ONTARIO

CITATION: Upchurch v. Oshawa (City), 2014 ONCA 425

DATE: 20140526

DOCKET: C57357

Weiler, Lauwers and Pardu JJ.A.

BETWEEN

Donald Thomas Upchurch and Carla Pauline Upchurch

Plaintiffs (Appellants)

and

The Corporation of the City of Oshawa

Defendant (Respondent)

Scott R. Fairley, for the appellants

Jasmine T. Akbarali and Nada Nicola-Howorth, for the
    respondent

Heard: April 7 and 11, 2014

On appeal from the judgment of Justice Bruce A. Glass of
    the Superior Court of Justice, dated June 7, 2013, with reasons reported at
    2013 ONSC 3375, and his costs decision dated July 2, 2013, with reasons
    reported at 2013 ONSC 4498.

Pardu J.A.:

[1]

The appellants sued the City of Oshawa for negligence. They alleged that
    the City owed them a duty not to prosecute them for relying on the Citys
    advice that they did not need a building permit to construct a deck, and that
    the City breached the standard of care and was negligent in its provision of
    advice and enforcement of the
Building Code
. The trial judge
    concluded that the City had acted reasonably, and that it had not provided the
    misinformation alleged by the appellants, and accordingly dismissed the action.

[2]

The appellants argue that the trial judge made errors of law and
    palpable and overriding errors of fact when he concluded that the City met the
    standard of care and found the City not liable in negligence. They also seek
    leave to appeal from the trial judges decision granting substantial indemnity
    costs to the City.

[3]

For the reasons that follow, I would dismiss the appeal. However, I
    would grant leave to appeal the trial judges decision on costs, and would
    allow that appeal.

Factual Background

[4]

One of the appellants, Mr. Upchurch, intended to build a new deck at 178
    Division Street, in Oshawa. He went to the city offices to inquire whether he
    needed a building permit for construction of a deck. Mr. Upchurch testified
    that he brought his construction plans with him to the City offices; the City
    office employee testified otherwise. Mr. Upchurch was told he did not need a
    permit as long as the deck was no higher than 24 inches above the adjacent
    grade. Mr. Upchurch began construction.

[5]

On September 28, 2006, someone complained to the city about construction
    taking place without a permit, and a building inspector, Mr. Van Vaals,
    attended at the property to look at the deck. He reported back to his
    supervisor that Mr. Upchurch had indicated that the deck surface would be less
    than 24 inches from the adjacent surface. Mr. Upchurch took the position that
    because he would be installing planters on the perimeter of the deck, the
    distance from the deck to the top of the planters was less than 24 inches, and
    he did not need a permit.

[6]

Mr. Van Vaals supervisor instructed him that a permit was required,
    taking the view that the proper distance to be measured was to ground level and
    not the top of the planters. Mr. Van Vaals telephoned Mr. Upchurch that same
    afternoon and left him a voice mail message to the effect that a permit was
    required. Mr. Upchurch declined to apply for a permit, and did not stop
    construction. As a result, a No Permit Order was affixed to the front door of
    the property on October 10, 2006. Notwithstanding the No Permit Order, the
    Upchurches did not cease construction, but appealed the No Permit Order to the
    Superior Court of Justice; their appeal was dismissed on May 8, 2007. Subsequently,
    on June 21, 2007 the City issued an Order to Uncover so that it could inspect
    the work below the deck surface.

[7]

On September 5, 2007, the City charged Mr. Upchurch with failing to
    obtain a building permit, failing to comply with the No Permit Order, and
    failing to comply with the Order to Uncover, pursuant to the
Ontario
    Building Code Act
, 1992,
S.O. 1992, c. 23.

[8]

The appellants appealed to the Divisional Court from the order of May 8,
    2007 dismissing their appeal challenging the No Permit Order. The Divisional
    Court allowed the appeal on the ground that when installation of the planters
    was complete, the deck surface would be less than 24 inches from the planters,
    and that a permit was not required.

[9]

Following the release of the Divisional Court decision, the City
    withdrew the charges under the
Ontario Building Code Act
. The
    appellants then commenced a claim against the City alleging negligence and
    malicious prosecution. Their Statement of Claim alleged bad faith on the part
    of the City, and claimed damages in the amount of $300,000. The appellants
    withdrew the malicious prosecution claim shortly before trial.

Decision Below

[10]

The
    trial judge rejected the appellants evidence that Mr. Upchurch brought his
    deck plans with him when he first visited the City offices, and found instead
    that he made a cursory oral inquiry about deck construction with or without a
    building permit, and that under the circumstances, the City employee conducted
    himself in a reasonable matter and that the information he provided was not
    inaccurate. Accordingly, he dismissed the appellants claim that the City
    negligently advised him that no permit was required.

[11]

With
    respect to the appellants other claims in negligence, the trial judge defined
    the standard of care by indicating that the City was obliged to administer the
Building
    Code
in an objectively fair and impartial manner, and to act reasonably. He
    accepted that there had been a grey area as to whether planters would qualify
    as adjacent grade for the purposes of measuring distance to adjacent grade. He
    noted that the
Building Code
was later amended to clarify that the
    distance to ground level was the required measurement.

[12]

The
    trial judge concluded that the officials were acting reasonably in
    interpreting that what Mr. Upchurch was doing was not within acceptable limits
    of constructing a deck without a building permit. They were not negligent in
    exercising their duties. He rejected the allegation that the City was
    harassing the appellants, or engaged in a vendetta against them.  Therefore, he
    dismissed the appellants claims for damages for negligence.

Analysis

[13]

The
    trial judge rejected the appellants evidence that Mr. Upchurch brought his
    deck plans with him when he first visited the City offices, and rejected his
    evidence that he was told he did not need a permit. Given the conflicting
    evidence before him, this finding was reasonably open to the trial judge and
    was buttressed by other evidence. This was sufficient to dispose of the appellant
    Mr. Upchurchs claim that the City negligently advised him that no permit was
    required.

[14]

The
    rest of the claims depend on an assessment of the conduct of City officials
    from the time of their first visit to the property. The essence of the appellants
    action is that the City was negligent to issue the orders it did and to
    prosecute him for offences under the
Ontario Building Code Act
, given
    the finding of the Divisional Court that no permit was required. He also
    asserts that the inconsistent advice given to him about the necessity for a
    building permit amounted to negligence. This latter assertion cannot be
    sustained given the trial judges finding that he was not told he did not need
    a building permit when he first went to the Citys building department.

Did the trial judge apply the incorrect standard of
    care or apply the correct standard of care incorrectly?

[15]

The
    parties proceeded at trial and on appeal on the common assumption that the
    circumstances of this case gave rise to a duty of care on the part of the city,
    and that a breach of the standard of care in discharging this duty could give
    rise to an action for negligent investigation. The plaintiffs abandoned their
    claim of malicious prosecution.

[16]

The
    elements of the tort of malicious prosecution require a plaintiff to prove:

1.

The prosecution
    was initiated by the defendant

2.

The prosecution
    was terminated in favour of the plaintiff

3.

The prosecution
    was undertaken without reasonable and probable cause. In the context of a
    public prosecution by the Crown or an individual Crown attorney, this means
    that there were not objectively speaking reasonable grounds to initiate or
    continue the prosecution or that subjectively, the prosecutor did not
    subjectively believe that proof to the required standard could be made in a
    court of law

4.

That the
    prosecutor acted with malice, that is to say, used the office of prosecution
    for an improper purpose.

(See
Miazga v. Kvello Estate
, 2009 SCC 51)

[17]

Absent
    these requirements, neither errors in judgment or discretion or even
    professional negligence are sufficient to establish the intentional tort of
    malicious prosecution. (See
Nelles v. Ontario
, [1979] 2 S.C.R. 170)

[18]

Here
    the appellants brought their action in negligence and argue that there were not
    objectively speaking reasonable grounds to initiate or continue the prosecution
    for the offences under
Ontario Building Code Act
. If this is
    characterized as an investigation to which the simple standard of a
    reasonable bylaw enforcement officer applies, then the distinction between an
    action for malicious prosecution and an action for negligent investigation is
    obliterated.

[19]

In
Hill v. Hamilton-Wentworth Regional Police Service
, 2007 SCC 47, the
    Court recognized the tort of negligent investigation of a targeted subject by
    police. In that case the negligence alleged was publication of the suspects
    photograph, conduct of a photo line-up including the aboriginal accused and 11 Caucasians,
    and interviewing identification witnesses together while a photograph of the
    accused was displayed on a desk, in circumstances where identification of a
    robber was in issue. These were investigative steps removed from decisions to
    initiate or continue prosecution.

[20]

What
    then are the elements in this case which might be characterized as
    investigatory steps? It is not suggested that the City failed to consider the
    appellants interpretation of the
Building Code
, or that it was
    negligent in responding to a complaint or in the manner in which it inspected
    the construction project.

[21]

It
    may be difficult in this context to distinguish activities characterized as
    investigation from those amounting to prosecution. Assuming, without
    deciding, that thee constellation of facts in this case can be potentially
    characterized as  investigatory steps, the standard of care required is that
    of the reasonable building code enforcement officer. In the context of police
    investigations, the Supreme Court observed in
H
ill v. Hamilton
    Wentworth Police Service v. Hill
, 2007 SCC 41, [2007] 3 S.C.R. 129, at
    para. 73:

The standard of care is not breached because a police officer
    exercises his or her discretion in a manner other than that deemed optimal by
    the reviewing court.  A number of choices may be open to a police officer
    investigating a crime, all of which may fall within the range of
    reasonableness.  So long as discretion is exercised within this range, the
    standard of care is not breached.  The standard is not perfection, or even the
    optimum, judged from the vantage of hindsight.  It is that of the reasonable
    officer, judged in the circumstances prevailing at the time the decision was
    made.

[22]

In
Rausch v. Pickering
, 2013 ONCA 740, this court indicated that a municipality
    enforcing a by-law owed a duty of care to persons who were the subject of
    investigations. This was in the context of a pleading motion where the issue
    was whether it was plain and obvious that the plaintiff did not have a common
    law cause of action and whether it was adequately pleaded. Pickering compelled
    Rausch to get rid of a herd of wild boars. The
Farming and Food Production
    Protection Act
, 1998, S.O. 1998, c.1 (
FFPPA
) prevented municipal
    by-laws from restricting a normal farm practice. The plaintiff alleged that the
    defendant was negligent in taking enforcement proceedings against him, and that
    it knew or ought to have known that the bylaws could not apply to prohibit his
    keeping of the herd. While the issue on appeal in
Rausch
was whether
    the courts below erred in declining to strike a claim under Rule 21 on the
    basis that no such duty of care existed, rather than what standard of care
    should be applied, Epstein J.A. suggested that the appropriate standard of care
    would be that of a reasonable by-law enforcement officer. The Court observed at
    para. 88:

Municipalities are presumed to know the law:
Boundary Bay
    Conservation Committee v. British Columbia (Agricultural Land Commission)
,
    2008 BCSC 946, [2008] B.C.J. No. 1369, at para. 71. Further, this court has
    held that enforcement officers are obliged to (i) act in good faith in relation
    to their decisions as to how a by-law will be enforced, and (ii) act with
    reasonable care in any steps they take to enforce a by-law:
Foley v.
    Shamess
, 2008 ONCA 588, 297 D.L.R. (4th) 287, at para. 29; see also
Butterman
    v. Richmond (City)
, 2013 BCSC 423, [2013] B.C.J. No. 461,

at
    para. 38.  The combination of these two factors  presumed knowledge of the law
    and an obligation to act reasonably and in good faith in enforcing it  and the
    wording of s. 444 of the
Municipal Act
mentioned above, may be
    relevant to the determination of the standard of care. Specifically, it may
    permit a finding that when attending at Mr. Rauschs premises and observing
    livestock in circumstances that appeared farm-like, the by-law enforcement
    officer ought to have considered the implications of the
FFPPA
before
    proceeding with enforcement steps.

[23]

The
    Court did not suggest that the by-law enforcement officer had to necessarily be
    correct in his interpretation of the
FFPPA
or bylaws, but indicated that
    he consider the implications of those provisions.

[24]

In
    this case, the trial judge defined the standard of care as requiring the City
    to administer the
Building Code
in a fair and impartial manner, and to
    act reasonably. He concluded, I find that the officials were acting reasonably
    in interpreting that what Mr. Upchurch was doing was not within acceptable
    limits of constructing a deck without a building permit. They were not
    negligent in exercising their duties.

[25]

The
    appellants argue that the trial judge erred in applying the standard of care
    applicable to an inspector acting under the
Building Code
, because the
    Divisional Court ultimately found that the
Building Code
did not require
    a building permit in this case. The standard of care that they submit is
    applicable  that would be expected of an ordinary, reasonable and prudent
    inspector in the same circumstance  is identical to that set out by the trial
    judge, at para. 24 of his reasons.

[26]

The
    appellants do not argue that the trial judge did not accurately define the
    standard of care, but submit that he misapplied that norm. An exacting standard
    of appellate review applies to conclusions by a trial judge as to whether a
    partys conduct met the required standard of care.

[27]

In
Housen v. Nikolaisen
, 2002 SCC 33, [2002] 2 S.C.R. 235, the Supreme Court
    dealt with the issue of the standard of review of a trial judges decision as
    to whether a municipality had met the standard of care required for road
    maintenance. The Court held, at para. 36, that the general rule is that where
    the issue on appeal is the trial judges interpretation of the evidence as a
    whole, it should not be overturned absent palpable and overriding error. No
    such error has been demonstrated here.

[28]

The
    appellants argue that, because the Divisional Court ultimately determined that
    a permit was not required under the
Building Code
, the Citys investigation
    and enforcement actions, and eventual laying of charges under the
Building
    Code
with respect to the appellants activities, necessarily constituted a
    breach of the required standard of care. This is incorrect. Assuming that a
    claim for negligent investigation is appropriate in these circumstances, it is
    insufficient to merely show that the Citys interpretation of the
Building
    Code
was not ultimately sustained. As the trial judge correctly determined,
    the standard of care in a negligent investigation claim requires that the City
    representatives exercised their duty reasonably, not that their interpretation
    of the law was ultimately correct.

Did the trial judge commit palpable and overriding
    error when he concluded that Mr. Upchurch was the author of his own misfortune?

[29]

The
    appellants also argue that the trial judge committed a palpable and overriding
    error in fact, and an error in law, in finding that Mr. Upchurch was, in part,
    the author of his own misfortune. I disagree. This finding was within the trial
    judges discretion in light of the evidence before him, and in light of his
    assessment of the various witnesses credibility. In any event, as the trial
    judge did not err in finding that the Citys conduct met the relevant standard
    of care, this finding would not have affected the disposition of this case.

[30]

Accordingly,
    the appeal from dismissal of the action is dismissed. It is therefore not
    necessary to deal with the issue of damages.

Did the trial judge err in awarding costs to the
    city on a substantial indemnity basis?

[31]

The
    appellants also seek leave to appeal from the trial judges decision granting
    substantial indemnity costs to the City in the amount of $70,000. The trial
    judge awarded substantial indemnity costs because of the appellants vigorous
    pursuit of the action, their discontinuance of the claim for malicious
    prosecution on the eve of trial, their unsubstantiated allegations of improper
    conduct by City officials, the pursuit of claims for aggravated and punitive
    damages and because the City made an offer to settle. The parties agree that
    the Citys offer did not attract the cost consequences of rule 49.10, although
    the fact that the City offered to settle for payment of up to $15,000 in
    exchange for dismissal of the action was a factor which could be considered in
    assessing costs.

[32]

The
    appellants pursuit of this action which was ultimately dismissed is not the
    kind of reprehensible or egregious conduct that would justify an award of
    substantial indemnity costs.

[33]

The
    appellants conduct of the litigation did not reach the levels described in
Di
    Battista v. Wawanesa Mutual Insurance Company
, [2005] 78 O.R. (3d) 445,
    where a losing plaintiff who made unfounded allegations of fraud and dishonesty
    seriously prejudicial to the character or reputation of the City or its employees
    was ordered to pay costs on a substantial indemnity basis. Here the refusal to
    follow counsels advice to settle the case and the pursuit of claims for
    aggravated and punitive damages do not by themselves justify costs on a
    substantial indemnity basis.

[34]

Accordingly,
    I would grant leave to appeal the trial judges costs decision and would allow
    this appeal.

[35]

This
    was a four day trial. The trial judge indicated the costs which were claimed at
    para. 17 of his reasons for his costs order:

The quantum presented in the bill of costs by the Defendant is
    shown to be $79,901.80 on a partial indemnity scale and $113,761.54 on a
    substantial indemnity scale. Ms. Nicola-Howorth shows that the actual account
    to the client is $137,898.01. These figures include HST. In addition, there are
    disbursements of $4,003.41 subject to HST of $520.44 and disbursements not
    subject to HST of $233.74.

[36]

I
    would vary the substantial indemnity costs awarded following trial to an award
    of partial indemnity costs which I fix at $35,000 plus disbursements inclusive
    of HST of $4,757.59.

[37]

Since
    success on the appeal was divided, each party shall bear its own costs of the
    appeal.

Released: May 26, 2014

(K.M.W.)
    G. Pardu J.A.

I agree K.M. Weiler J.A.

I
    agree P. Lauwers J.A.


COURT OF APPEAL FOR ONTARIO

CITATION:
Yelda v. Vu, 2014 ONCA 353

DATE: 20140505

DOCKET: C57665

Doherty, Cronk and Hourigan JJ.A.

BETWEEN

Valmire Yelda

Plaintiff (Appellant)

and

Thi
    Duyen Vu, also known as Peter Vu,

Diane
    Vu, Selena Vi, also known as Selena Ferreira Vu or, Ines Vu,

Ivo
    Curzi, and State Farm Mutual Automobile Insurance Co.

Defendants (Respondents)

Don Morris, for the appellant

Chris G. Paliare and Gregory Ko, for the Vu respondents

Stuart Aird, for the respondent Ivo Curzi

Heard: April 25, 2014

On appeal from the judgment of Justice Harrison S. Arrell
    of the Superior Court of Justice, dated August 9, 2013, on a motion for summary
    judgment and Justice Arrells costs judgment, dated September 20, 2013.

By the Court:

I.        Introduction

[1]

On July 19, 2002, the respondent Selena Ferreira Vu gave her co-worker,
    the appellant Valmire Yelda, a ride home from work.  Enroute, while Ms. Vu was
    driving and the appellant was sitting in the front passenger seat, the Vu
    vehicle was struck by a pickup truck driven by the respondent Ivo Curzi.  On
    May 25, 2011, almost nine years later, the appellant sued Selena Vu and Mr.
    Curzi, together with various of their family members and State Farm Insurance
    Company (State Farm), for damages in the amount of $3.35 million for serious
    personal injuries allegedly suffered by her in the collision.  The action
    against Diane Vu and the insurance company was subsequently discontinued (Diane
    Vu) or dismissed (State Farm).

[2]

After the exchange of pleadings and the conduct of discoveries, the Vu
    defendants and Mr. Curzi moved for summary judgment on the basis that the
    appellants action was barred by the expiry of the applicable two-year
    limitation period under the
Limitations Act, 2002
, S.O. 2002, c. 24,
    Sched. B. (the Act).

[3]

The appellant claimed that she suffered a permanent serious impairment
    of an important physical, mental or psychological function as a result of
    injuries sustained by her in the motor vehicle accident.  She further alleged
    that she did not discover that her injuries met this threshold for a claim
    until December 29, 2009, when she learned of the results of an x-ray conducted
    in November 2009 that identified significant injuries to her back.  As a
    result, the appellant maintained, the applicable two-year limitation period
    began to run on December 29, 2009 and her May 2011 action was commenced in
    time.

[4]

The motions judge disagreed.  He held that on the appellants own
    descriptions of her condition, she should have taken steps to investigate her
    back pain by 2005 or 2006.  Had she done so, she would have known, at the very
    least, in November 2008 that she had a serious and permanent impairment of
    important physical functions. As a result, the applicable limitation period
    expired in November 2010, at the latest, and the appellants action was
    statute-barred.

[5]

Accordingly, by judgments dated August 9 and September 20, 2013, the
    motions judge granted the respondents summary judgment motions, dismissed the
    appellants action and awarded costs in favour of the respondents.

[6]

The appellant appeals from the summary judgment, seeks leave to appeal
    the motions judges costs award and, if leave be granted, appeals against the
    costs award.

II.       Issues

[7]

In her factum, the appellant attacked the motions judges summary judgment
    ruling on multiple grounds.  However, during oral argument before this court,
    and before the motions judge, the appellant conceded that this was a suitable
    case in which to decide the limitations issue by way of summary judgment.  As a
    result, there are only two remaining issues on this appeal:

(1)

Did the
    motions judge err by finding that the appellant ought to have discovered the
    existence of her potential claim before May 25, 2009?

(2)

Did the
    motions judge err in his discoverability analysis by failing to consider the
    appellants individual characteristics and circumstances?

III.      Discussion

(1)

Motions Judges Discoverability Finding

[8]

The record before the motions judge was essentially non-controversial on
    material issues.  There were no contentious facts alleged by any of the parties
    relating to the threshold for the appellants claim under s. 267.5(5) of the
Insurance
    Act
, R.S.O. 1990, c. I.8, discoverability, and due diligence.  Indeed, in
    support of their limitation argument, the respondents relied almost exclusively
    on the appellants own descriptions of her medical condition found in discovery
    evidence and various statements she made.

[9]

Based on her own evidence, the appellant experienced what she described
    as really bad lower back pain half the time each month following the
    accident.  According to the appellant, on occasion between 2002 and 2009 the
    severity of her pain prevented her from functioning, she was really never pain
    free at any time, and she struggled with ongoing back pain for ten years following
    the accident.  At all times, the appellant attributed her pain solely to
    injuries sustained by her in the collision.

[10]

However,
    apart from occasional visits to hospital emergency departments, the appellant
    took no active steps to investigate what she said was persistent, ongoing back
    pain from the summer of 2002 until September 2009, when she was referred for
    x-rays of her lumbar spine.  The x-ray was carried out on November 13, 2009 and
    eventually led to corrective back surgery.

[11]

Moreover,
    throughout the seven-year period between the summer of 2002 and the fall of
    2009, the appellant continued to work full time except for a one-year maternity
    leave from November 2007 to October 2008.  Although she attended at various
    hospital emergency departments on three occasions (March 2005, October 2006 and
    November 2008), and continued to see family physicians in the normal course, she
    took no steps to investigate the cause of what she maintained was consistent
    and debilitating lower back pain.

[12]

In
    holding that a reasonable person would have made the necessary medical
    investigations before November 2009 and determined the serious and permanent
    nature of the back injury, the motion judge made the following findings:

(1)

it was
    implausible that a reasonable person would consistently take over-the-counter
    pain medication for many years for pain she believed was solely caused by the
    car accident, and yet do nothing to further investigate the cause;

(2)

it was
    implausible that a reasonable person could have pain consistently and really
    bad pain 50 percent of the time and do nothing to investigate the cause;

(3)

it was
    implausible that someone who was unable to function a couple of days per month
    because of pain would make no investigation; and

(4)

it was
    implausible that a reasonable person would find her pain so bad on three
    occasions (2005, 2006 and 2008) that she attended an emergency ward for relief
    and yet would do nothing further to investigate the reasons for her pain, after
    being told by emergency room doctors that her pain would subside, which was not
    the case.

[13]

The
    motions judge therefore concluded, given the evidence as a whole, that the appellant
    ought to have known, well before May 25, 2009, that because of her serious back
    injury, she had a serious and permanent impairment of her ability to function
    on a day-to-day basis.

[14]

On
    this record, this critical finding was open to the motions judge.  We see no
    palpable and overriding error in this finding and, thus, there is no basis for
    appellate intervention:
Hryniak v. Mauldlin
, 2014 SCC 7, at para. 81.

(2)

Consideration of the Appellants Individual

Characteristics
    and Circumstances

[15]

Under
    s. 5(1) of the Act, a claim is discovered on the earlier of the day on which
    the person with a claim first knew of the existence of the claim and the day
    on which a reasonable person with the abilities and in the circumstances of the
    person with the claim first ought to have known of the existence of the claim.

[16]

The
    appellant contends that the motions judge erred in his consideration of
    discoverability under s. 5(1) by failing to take account of her individual
    characteristics and circumstances.  We reject this contention.

[17]

The
    appellant did not adduce any evidence that her particular characteristics and
    circumstances were such that even if the hypothetical reasonable person should
    have been aware of the nature of her injury, she could not have discovered her
    claim prior to November of 2009.  Nor was this argument advanced before the
    motions judge.  There was, therefore, no basis for the motions judge to make
    such a finding.

IV.     Disposition

[18]

Accordingly,
    for the reasons given, the appeal from the motions judges summary judgment
    ruling is dismissed.  Since the appellants motion for leave to appeal the
    motions judges costs order is conditional on success on the main appeal, leave
    to appeal costs is denied.  In the unusual circumstances of this case, the
    interests of justice do not support any award of the costs of the appeal.

Released: DD May 5, 2014

Doherty J.A.

E.A. Cronk J.A.

C.W. Hourigan J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Wells Fargo Bank, N.A. v. Best Theratronics Ltd.,
    2014 ONCA 409

DATE: 20140520

DOCKET: C57783

Doherty, Epstein and Benotto JJ.A.

BETWEEN

Wells Fargo Bank, N.A.

Plaintiff (Respondent)

and

Best Theratronics Ltd.

Defendant (Appellant)

and

Best Medical
    International, Inc. and Huestis Machine Corporation

Applicants (Appellants)

and

Wells Fargo Bank, N.A.

Respondent (Respondent)

Eli S. Lederman and David Quayat, for the appellants

A. Irvin Schein and M. Maurer, for the respondent

Heard and orally released: May 14, 2014

On appeal from the judgment of Justice Pattillo of the Superior
    Court of Justice, dated September 12, 2013.

ENDORSEMENT

[1]

This was an appropriate case for summary judgment.

[2]

The motion judge was entitled to accept and act on the evidence of the
    respondents expert as to the proper interpretation of the commercial
    reasonableness standard in the
Uniform Commercial Code
.  The expert
    was qualified to give the opinion he gave.  His opinion did not, in our view,
    fly in the face of the language of the
Uniform Commercial Code
, and in
    particular s. 8.9(a)-607(c).  His opinion was consistent with that language:
    see the motion judges reasons at para. 38.

[3]

It may be that the language in question was open to another
    interpretation.  However, the appellants chose not to put any expert evidence
    forward on the motion.  The motion judge was entitled to take that fact into
    account, both in weighing the evidence tendered by the respondent and in
    considering whether the case was an appropriate case for summary judgment.  He
    did exactly that.

[4]

We see no merit to the points made about the experts alleged bias and
    the impact that it should have on his evidence.  The motion judge was able to
    consider the points made about the experts alleged bias for what they were
    worth.  Not surprisingly he concluded that there was no credibility issue
    (para. 37) with respect to the experts evidence.

[5]

In light of our determination that the motion judge properly granted
    summary judgment on the basis of the material put forward by the respondent, we
    need not consider his reasons as they relate to the cause of action
estoppel
issue
.  The appellants correctly, in our
    view, accepted that if they did not succeed on the first point, it did not
    matter whether they succeeded on the second point.

[6]

The appeal is dismissed.

[7]

On agreement, the respondent will receive costs in the amount of
    $15,000, inclusive of disbursements and relevant taxes.

Doherty J.A.

Gloria Epstein J.A.

M.L. Benotto J.A.