COURT OF APPEAL FOR ONTARIO

CITATION:
Korea
    Data Systems (USA), Inc. v. Aamazing Technologies Inc., 2012 ONCA 756

DATE: 20121106

DOCKET: M41692 (C55916)

Blair J.A. (In Chambers)

BETWEEN

Korea Data Systems (USA), Inc.

Plaintiff (Appellant/Moving Party)

and

Aamazing Technologies Inc. carrying on business
    as Ajay Amazing Technologies Inc.,
Jay Chiang, aka Jay
    Tien Chiang aka Tienchieh Chiang
, Julius Chiang and Christina Chiang aka
    Christian Chiang aka Suh Mei Tasi, aka Suh Mei Tsai aka Christina Suh Mei Tsai,
    aka Suh Mei Tasi Chiang, aka Christina Suh-Mei Chiang aka Suh-Mei Chiang, and
    Dong Liang aka Tung Liang

Defendants (
Respondent in Appeal
)

AND BETWEEN

Mendlowitz &
    Associates Inc., in its capacity as Trustee in Bankruptcy of Jay Tien Chiang,
    and Korea Data Systems (USA) Inc.

Plaintiffs (Appellants/Moving Parties)

and

Jay
    Tien Chiang, aka Jay Chiang, aka Tienchieh Chiang, Christina Chiang, also known
    as Suh Mei Tasi, aka Christian Chiang aka Suh Mei Tsai, aka Christina Suh Mei
    Tsai, aka Suh Mei Tasi Chiang, aka Christina Suh-Mei Chiang aka Suh-Mei Chiang,
Chun Chun Wu,
    Jie Chu Wu
, Chen Cheng-Yueh Tsai, Yu Chang Chiang also knows as Y.C.
    Chiang, En Fu Chiang, Brenda Chang, Samson Chang, David Cheng, Everview Inc.,
    961266 Ontario Inc.,1204360 Ontario Inc., 1243723 Ontario Inc., Aamazing
    Technologies Inc.,
Wen Wang Chiang aka Wen Chiang aka Wen Wang,
    Crystalview Technology Corp., E.C. Holdings Ltd., Telepower International
    (Canada), Inc., Best Buy Electronics Inc.,
Su Feng Tsai
    aka Tsai Su Feng, Tsai Zheng Li, Tsai Zheng Ying, Asia Pacific Gateway (H.K.)
    Ltd., Century Group Holdings Ltd., Albany Investments Ltd., Mei Huang, Winner
    International Group Limited, Huang Chi Lung, Min Huang, Wainwright Ventures
    Ltd., New Global Investment Limited and Floratino Limited

Defendants (
Respondents in Appeal
)

Aaron Blumenfeld and Alessandra Nosko, for the
    appellants, Korea Data Systems (USA), Inc. and Mendlowitz & Associates
    Inc., Trustee in Bankruptcy of Jay Tien Chiang

Hilary Book, for the respondent Christina Chiang

Rebecca Huang, for the respondents Winner International
    Group Limited and Mei Huang

John OSullivan, for the respondents Su Feng Tsai, Tsai
    Zheng Li, Tsai Zheng Ying, Huang Chi Lung and Chen Cheng-Yueh Tsai

Brent Arnold, for the respondents Brenda Chang and Samson
    Chang

Heard: October 23, 2012

Motion to stay the appeal from the judgement of Justice Frank N. Marrocco of the Superior Court of Justice dated July 9, 2012.

[1]

The issues on this motion are the following: (1) Was there a final
    judgment at trial that can form the subject matter of an appeal, given the
    outstanding matters left to be determined, and (2) if there is, should the
    appeal be stayed pending the determination of those outstanding matters?

Background

[2]

The trial was long and complex, and involved many parties.  It dealt
    with two actions together.

[3]

The plaintiff in the first action  Korea Data Systems (USA), Inc.
    (KDS)  is a significant judgment creditor of the defendant, Jay Chiang,
    pursuant to a multi-million dollar judgment obtained against him in the
    California Superior Court.  Shortly after the judgment was rendered, Mr. Chiang
    made an assignment in bankruptcy in Ontario.  KDS nonetheless sued to enforce
    the California judgment in Ontario, arguing that the judgment represented the
    kind of debt that survives a bankruptcy.

[4]

In the second action, KDS and Mr. Chiangs Trustee in Bankruptcy,
    Mendlowitz & Associates Ltd., sued Mr. Chiang and numerous companies and
    related family members claiming damages, different forms of declaratory relief
    and an equitable tracing order.  They alleged fraudulent conveyance of
    property, conspiracy, spoliation and unjust enrichment.  In substance, though,
    the claim was that Mr. Chiang, in conspiracy with the other defendants, was
    hiding and spiriting away assets from his creditors and his Trustee in
    Bankruptcy.

[5]

Justice Marrocco presided over the trial.  After 10 weeks of evidence
    plus lengthy written submissions, he found that Jay Chiang had indeed engaged
    in a conspiracy to defeat the plaintiffs collection efforts and that he had
    used nominees for that purpose and to hide his assets.  But the parties to the
    conspiracy were not Mr. Chiang and these respondents.  They were Mr. Chiang and
    his father and a brother (the latter two are no longer parties to the
    proceedings).  The conspiracy and related claims were dismissed against these
    respondents for varying reasons, but essentially because, although their
    actions may have assisted Mr. Chiangs efforts, they were not part of a
    conspiracy agreement to defeat, hinder, delay or defraud his creditors.

[6]

With respect to the respondents, Winner International Group and Mei
    Huang, the issue was somewhat different.  Winner is the holder of an
    approximately $10 million fund that KDS and Mendlowitz allege belongs to the
    bankrupt, Jay Chiang.  Mei Huang is the registered owner of all of the shares
    of Winner, but the trial judge found that she holds a 50% interest in trust for
    Mr. Chiang.  On appeal, KDS and Mendlowitz will argue that the trial judge
    erred and should have found that 100% of the shares are held in trust for Mr.
    Chiang.

[7]

KDS and the Trustee wish to appeal the dismissal of the actions against
    the other respondents and some of the findings respecting Mr. Chiang, including
    the one just mentioned above.  They have filed a Notice of Appeal solely to
    protect their position. They maintain that there is as yet no need to appeal
    because the trial judge left a number of issues open for subsequent
    determination and there is no final judgment at this point that can be the
    subject of an appeal.  The parties differ over this interpretation as well as
    over whether, if there is a final judgment, any appeal should be stayed at this
    point pending the finalization of the outstanding issues by the trial judge.

[8]

That dispute has given rise to this motion.

[9]

KDS and Mendlowitz seek an order staying the appeal pending the
    disposition of the issues left to be determined by the trial judge.  The
    remaining respondents oppose, arguing that those issues relate only to Jay
    Chiang  who takes no position on the motion  and that the issues respecting
    them are discrete and finalized, and should proceed.

Analysis

[10]

The
    issues still to be determined by the trial judge (the Outstanding Issues) may
    be summarized as follows:

a)

Post-judgment interest
    on the California judgment;

b)

The nature of the
    damages, if any, that KDS is entitled to recover from Mr. Chiang;

c)

The terms of a
Mareva
injunction in aid of execution, to which the trial judge held KDS and
    Mendlowitz were entitled;

d)

The specifics of an
    equitable tracing order against Mr. Chiang, to which the trial judge held KDS
    and Mendlowitz were entitled, should they consider it advisable to apply for a
    specific order (the trial judge held it was not an appropriate case for a
    general imprecise tracing order);

e)

An accounting with
    respect to the sum of $2 million transferred from the respondent, Floratino
    Limited, to Winner; and

f)

Costs.

[11]

On
    behalf of the appellants, Mr. Blumenfeld argues that the Outstanding Issues are
    substantial matters affecting the rights of the parties still remaining to be
    determined by the trial judge and, accordingly, that there is as yet no final
    judgment that disposes of [the] action on its merits:
Byers (Litigation
    Guardian of) v. Pentex Print Masters Industries Inc.,
(2003), 62 O.R. (3d)
    647, at paras. 19 and 41; see also the definition of judgement in Rule 1.03
    of the
Rules of Civil Procedure
, R.R.O. 1990, Reg. 194.  It follows,
    he says, that the time for appealing under Rule 61.04(1) has not yet begun to
    run, although the appellants have nonetheless filed a Notice of Appeal out of
    an abundance of caution.

[12]

The
    respondents do not quarrel with the
Byers
test, but submit that the
    Outstanding Issues do not relate to the dismissal of the claims against them.
    Those issues are discrete, finally disposed of, and readily subject to
    determination on appeal without determination of the Outstanding Issues, they
    argue.  The one exception may be the issue respecting the accounting for monies
    transferred to Winner, but the broader issue of whether the shares in Winner
    are held in a constructive trust for Mr. Chiang is one that is ripe for
    determination on appeal now.  The respondents contend that considerations of
    finality militate in favour of their issues being determined in a timely
    fashion on appeal, after more than a decade of litigation with, amongst other
    things, the restraints of a
Mareva
injunction hanging over their
    heads.

[13]

Unfortunately,
    the procedural choice is not so simple.

[14]

While
    I find Mr. Blumenfelds argument that there is not yet a final order to appeal
    from somewhat attractive, it faces both practical and procedural impediments as
    a result of the way in which the proceedings have evolved.  First, a Notice of
    Appeal
has
been filed, and therefore there is an appeal in existence.
    Secondly, the order the appellants seek in this regard would be tantamount to
    an order quashing the appeal, something I as a single judge have no authority
    to do.  Motions to quash must be determined by a panel of judges:
Courts of
    Justice Act
, R.S.O. 1990, c. C.43, s. 7(3).  Thirdly, no one is asking me
    to quash the appeal.  The respondents, who might have an argument for doing so
    if they brought a motion to that effect, do not want the appeal quashed; they
    want it to proceed as quickly as possible.  The appellants are hardly seeking
    to have their own appeal quashed.

[15]

It
    seems to me, then, that the motion must be determined on the basis that there
    is an appeal in place and a decision to be made whether that appeal should be
    stayed either for a limited period of time or until the Outstanding Issues have
    been dealt with by the trial judge.  In that exercise, the final order debate
    remains relevant, in my view.

[16]

What
    the appellants request here is not a stay of an order or judgment under appeal,
    pending the disposition of the appeal.  Nor is it a stay of another bodys
    proceedings (e.g. an arbitration proceeding or a trial) pending some other
    matter, or an injunction.  In those types of situations it is clear that the
    three-step exercise set out in
RJR-Macdonald Inc. v. Canada (Attorney
    General)
, [1994] 1 S.C.R. 311, applies.  That is, the court must ask
    itself (i) whether there is a serious issue to be determined, (ii) whether the
    applicant will suffer irreparable harm if the stay is not granted, and (iii)
    whether the balance of convenience favours the applicant or the respondent, and
    exercise its discretion based upon the answers to those questions.

[17]

Instead,
    the appellants ask this Court
to stay the appeal itself
, pending the
    decision of another body (the trial court).  In effect, they wish to have the Court
    adjourn the exercise of its own jurisdiction to proceed with the appeal until
    sometime later, pending the other bodys decision.  In those circumstances, the
    Federal Court has adopted a policy that the principles of
RJR-Macdonald
do not apply; rather, it is a matter of the court exercising its discretion and
    determining whether, in all the circumstances, the interests of justice
    support the appeal being delayed:
Mylan Pharmaceuticals ULC

v.
    AstraZeneca Canada, Inc
., 2011 FCA 312, 426 N.R. 167, at paras. 3, 5, 6
    and 14,
per
Stratas J.A.; see also
EpiCept Corp. v. Canada
    (Minister of Health)
, 2011 FCA 209, 425 N.R. 353.

[18]

The
    Federal Courts rationale is rooted in the wording of s. 50 of the
Federal
    Courts Act
, R.S.C. 1985, c. F-7  its statutory power to grant a stay
    which empowers the court to stay proceedings where it is in the interest of
    justice that the proceedings be stayed.  That is the core tenet underlying any
    courts power to impose a stay of proceedings, in my view, and applies equally
    to the exercise of this Courts jurisdiction to stay an appeal pending the
    disposition of another body.

[19]

I
    prefer the broader interests of justice test to the three-stage
RJR-Macdonald
test in such circumstances because I think it responds more flexibly to the
    somewhat different considerations that are in play when a party seeks to have
    the appeal itself stayed as opposed to an order or judgment appealed from.  In
    the former circumstances, broader considerations regarding the administration
    of justice are also in play.  Factors demonstrating irreparable harm or an
    imbalance of convenience are undoubtedly relevant when a court is contemplating
    delaying its proceedings until a later time, (considerations respecting the
    merits of the appeal, perhaps less so). However, the court must also take into
    account other factors such as the public interest in the fair, well-ordered and
    timely disposition of litigation, and the effective use of scarce public
    resources.

[20]

Taking
    into account all of those considerations, I am satisfied that a relatively
    short, and time-limited, stay of the appeal ought to be ordered in the
    circumstances here but subject to one condition: that the appellants be
    required to order the transcript needed for purposes of the appeal involving the
    respondents now.

[21]

As
    I read the trial judges reasons, resolution of the Outstanding Issues does not
    involve any further evidence.  He has called for submissions.  I see no reason
    why those submissions cannot be made and dealt with within a reasonable period
    of time.

[22]

The
    one exception to the call for submissions may be the trial judges direction
    that the plaintiffs can apply for a specific equitable tracing order when
    they consider it desirable to do so.  It is not clear whether he contemplated
    additions to the evidentiary record in that regard.  Even if he did, however, I
    am not persuaded that the trial judgment would not be final and appealable
    until that determination is made, or that the appeal should be stayed
    indefinitely for that eventuality.  I am inclined to read the trial judges
    reasons as making a final order that the plaintiffs are entitled to an
    equitable tracing order against Jay Chiang, and granting them leave to apply
    later, if so advised, for a specific form of tracing order.

[23]

The
    procedural framework in Ontario does not generally contemplate the disposition
    of appeals in multi-party, multi-issue cases on a party by party basis.  There
    is one judgment following a trial.  This approach avoids a multiplicity of
    proceedings and the potential of inconsistent results.  While there are no
    doubt exceptions to this general policy, this is not such a case.  The trial
    here was not a bifurcated trial and evidence was led, and arguments made, on
    all issues respecting all defendants, including the Outstanding Issues.
    Ordinarily, one appeal dealing with all of those issues is the most effective
    and fair use of both the public and private resources involved.

[24]

At
    the same time, I have some sympathy for the position in which the responding
    parties find themselves.  They have been successful, for the most part, after a
    decade of pre-trial proceedings and a lengthy, complex, and expensive trial.
    If there is to be an appeal, they quite understandably and justifiably would
    like to have the appeal disposed of as soon as the
Rules of Civil Procedure
permit.  The allegations against them  and to this point, resolved in their
    favour  are serious (conspiracy and fraud).  There appears to be some merit in
    their view that the issues relating to them on appeal are separate and discrete
    from those remaining to be determined in the Outstanding Issues.  There is
    little prejudice to the appellants, except in terms of costs, if the appeal
    moves forward without finalization of the Outstanding Issues.

[25]

That
    said, the overall interests of justice favour the granting of a short stay, in
    my view, to enable the Outstanding Issues to be determined.  As the Divisional
    Court noted in
Rosenhek v. Windsor Regional Hospital
, [2010] O.J. No.
    2893, at para. 50, citing
Marché D'Alimentation Denis Thériault Ltée v.
    Giant Tiger Stores Ltd.,
2007 ONCA 605, 87 O.R. (3d) 660, at para. 34:

The
Rules of Civil Procedure
must be interpreted in a
    manner that recognizes that expeditious justice is only one value to be weighed
    against others and that delay may be excused where necessary to ensure complete
    justice.

[26]

In
    the result, I grant a stay of the appeal for a period of 120 days from the date
    of this decision or until the Outstanding Issues have
    been finalized by the trial judge, whichever is the earlier.  Notwithstanding
    the stay of the appeal, however, the appellants are to proceed to order the
    transcripts necessary for the appeal as if the
Rules
respecting the
    ordering of transcripts were in effect.

[27]

I
    do not think this is an appropriate motion for an award of costs, and I make no
    order in that regard.

R.A. Blair J.A.


COURT OF APPEAL FOR ONTARIO

CITATION:
Kudwah
    v. Centennial Apartments, 2012 ONCA 777

DATE: 20121113

DOCKET: C55100

Doherty, MacPherson and Simmons JJ.A.

BETWEEN

Wajid Kudwah

Plaintiff (Appellant)

and

Centennial Apartments, Princess Management
    Partnership and Michael Edward Halperin

Defendants (Respondents)

P. Michael Rotondo, for the plaintiff (appellant)

Robert L. Love and Natalie Kolos, for the defendants
    (respondents, Centennial Apartments

Heard:  November 9, 2012

On appeal from the order of Justice Lederer of the Superior
    Court of Justice, dated February 17, 2012.

APPEAL BOOK ENDORSEMENT

[1]

The motion judge did not address the requirements of s. 5 of the
Limitations
    Act, 2002
in his reasons.  In our view, he erred in law in failing to do
    so.

[2]

It is important when considering a limitation period claim to appreciate
    that the terms of the 2002
Act
must govern.  A court considering the
    limitation claim must address the specific requirements of s. 5 of the
Act
,
    particularly on the facts of this case, the requirement of s. 5(1)(a)(iv).

[3]

The appeal is allowed and the judgment below is set aside.

[4]

Costs of the motion to the appellant in the amount of $7,000, inclusive
    of all applicable taxes.  Costs of the appeal to the appellant in the amount of
    $5,000, inclusive of all applicable taxes.


COUR DAPPEL DE LONTARIO

RÉFÉRENCE :
Lacelle c. Miner, 2012 ONCA 740

DATE : 20121101

DOSSIER : C55429

Les juges Sharpe, Blair et Rouleau

ENTRE

Johanne Lacelle

Requérante (appelante)

et

Mario Miner

Intimé (Intimé)

Patrice A.J. Côté pour lappelante

Personne nayant comparu pour lintimé

Date de laudience : le 31octobre 2012

En appel de lordonnance du juge Paul
    Kane de la Cour supérieure de justice en date du 29 mars 2012.

INSCRIPTION

[1]

Nous avons conclu que lordonnance en outrage
    doit-être infirmée. Il y a eu plusieurs vices de procédure. Le juge de motions
    na pas rendu une décision suite à la demande de lappelante pour un
    ajournement. Elle demandait lajournement afin de déposer de la preuve experte
    expliquant pourquoi les enfants refusaient de visiter avec le père.

[2]

Selon les transcriptions il ny a pas eu
    daudience tenue en bonne et due forme. On note en particulier que le juge a
    demandé des questions de lintimé pour recevoir sa preuve, mais na pas donné
    la chance à lappelante de contre interroger lintimé pour contester ces
    allégations.

[3]

De plus, lavis de motion pour outrage
    nindiquait pas les dates où il est prétendu que lappelante na pas respecté
    lordonnance de la cour en refusant de permettre la visite des enfants avec le
    père.

[4]

Finalement, une des dates à laquelle lappelante
    a été déclarée en outrage au tribunal est après la date à laquelle laudience a
    été tenue.

[5]

Pour ces motifs, lappel est accueilli
    lordonnance du juge est infirmée. Les dépens sont fixés à 3,000 $ tout
    compris.


COURT OF APPEAL FOR ONTARIO

CITATION:
Laczko v. Alexander, 2012
    ONCA 803

DATE: 20121120

DOCKET: M41762

Weiler J.A. (In Chambers)

BETWEEN

Janos Laczko

Plaintiff (Responding Party)

and

Edwin Alexander and Mercedes Property Management
    Ltd.

Defendants (Moving Parties)

William G. Scott, for the moving parties

Richard A. Wellenreiter, for the responding party

Heard: November 13, 2012

On a motion to extend the time to appeal the order of
    Justice Jane A. Milanetti of the Superior Court of Justice, dated May 22, 2012.

Weiler J.A. (in chambers):

[1]

The moving parties seek an order to extend the time for filing a notice
    of appeal from an order striking out their statement of defence.

[2]

In deciding whether to extend the time, the following factors are
    relevant:
(1) whether the moving parties formed an intention to
    appeal within the relevant period; (2) the length of and explanation for the
    delay; (3) any prejudice to the responding party; (4) the merits of the appeal;
    and (5) whether the justice of the case requires it:
Kefeli v.
    Centennial College of Applied Arts and Technology
(2002), 23 C.P.C. (5th)
    35 (Ont. C.A.).

[3]

The individual moving party, Edwin Alexander, is a paralegal and a real
    estate agent.  He is also the directing mind of the corporate moving party,
    Mercedes Property Management Ltd.  The moving parties are the defendants in the
    underlying action.

[4]

The responding party, Janos Laczko, a carpenter and handy man, did work
    on a number of properties managed by the moving parties.  He says he was not
    paid for this work. In addition, the responding party owns rental property in
    partnership with Alexander. He claims to have performed repair and renovation
    services on those properties for which he has also not been paid. The
    partnership properties are managed by Alexander and his company, Mercedes. The
    responding party is the plaintiff in the underlying action.

[5]

The underlying action primarily involves a claim by Laczko against
    Alexander for breach of their partnership agreement. In addition, Laczko was
    permitted to amend his statement of claim to incorporate eight small claims
    court actions for services provided and four construction lien claim actions he
    had previously brought against the moving parties.

[6]

On May 22, 2012, Milanetti J. struck the moving parties statement of defence
    due to the failure of the Defendants to comply with outstanding orders for
    disclosure and the Defendants failure to comply with their disclosure
    obligations under the
Rules of Civil Procedure
(as well as Justice
    Lococos costs order). An order striking out a statement of defence is final
    for purposes of appeal:
Four Seasons Travel Ltd. v. Laker Airways Ltd.
(1974),
    6 O.R. (2d) 453 (Div. Ct.).

[7]

The moving party, Alexander, failed to file his notice of appeal within
    the requisite time period for final orders. He explains the delay on the
    grounds that his lawyers erroneously believed that Milanetti J.s order was
    interlocutory, and therefore subject to a longer time frame for filing. He has
    provided an affidavit from his lawyer to this same effect. He did file a notice
    of motion for leave to appeal on June 20, 2012, within thirty days of Milanetti
    J.s order.

[8]

For the purposes of this motion, I am prepared to accept that the moving
    parties formed an intention to appeal within the time for bringing an appeal,
    and that a satisfactory explanation for the delay in filing a notice of appeal
    has been given. The motion, therefore, turns on the remainder of the factors in
    the
Kefeli
test: whether the responding party would be prejudiced, the
    merits of the appeal, and the justice of the case. In order to discuss these
    factors, it is necessary for me to review the history of the proceedings. After
    doing so, I will comment on each factor in the circumstances of this case.

[9]

In March, 2010, the responding party Laczkos lawyer wrote to both
    Alexander and James Scott, Alexanders lawyer at the time, requesting certain
    disclosure relating to the dispute between the parties. On April 8, 2010, he
    again wrote Mr. Scott, requesting the annual financial statements relating to the
    partnership and the operation of the property so that his client, Laczko, could
    complete his income tax returns. Laczko alleges that at that time no statements
    had been produced by the moving parties since 2008.

[10]

On
    June 28, 2011, the Laczkos lawyer sent Mr. Scott a report dated June 27, 2011
    prepared by Larry Joslin, a forensic accountant.  The June Joslin report
    provided a detailed list of required disclosure.

[11]

On
    October 24, 2011, the Laczkos lawyer brought a motion to compel production of
    the moving parties affidavit of documents.

[12]

In
    response to the motion to compel, Alexander swore an affidavit in November,
    2011 disputing the relevance of certain productions. In that affidavit, he
    expressly acknowledged the June Joslin report.

[13]

At
    the return of the Laczkos motion to compel on November 24, 2011, the two
    parties signed Minutes of Settlement. The Minutes substantially incorporated
    the disclosure outlined in the June Joslin report, and set a new production
    deadline of January 31, 2012. Although Alexander states in his affidavit that
    he was not provided with a copy of the Minutes of Settlement until December 20,
    2011, he personally signed the Minutes of Settlement on November 24, 2011. He,
    therefore, must have been aware of the January 31, 2012 deadline, as well as
    the fact that the June Joslin report had been substantially incorporated into
    the Minutes. Alexander also knew of the June Joslin report as of early
    November, 2011. He did not need to wait for a copy of the Minutes of Settlement
    to know what production he was required to make.

[14]

Alexander
    turned over 1,500 pages of disclosure to his lawyer, Mr. Scott, either on
    Sunday, January 29, 2012 (according to Scott) or four or five days prior to
    the January 31 deadline (according to Alexander). Alexander states that his
    lawyer did not tell him a significant amount of time would be required to
    organize and bind the disclosure. The deadline was missed.

[15]

Despite
    follow-up correspondence between Laczkos lawyer and Mr. Scott, production was
    not made. As a result, on February 24, 2012, Laczko brought a motion returnable
    March 13, 2012 to strike the moving parties statement of defence or to compel
    production.

[16]

On
    the return date, Lococo J. granted a further indulgence to the moving parties
    and adjourned the motion to March 22, 2012, peremptory to the Defendants,
    subject to availability of Plaintiffs counsel, thereby allowing further time
    for production.  He also ordered costs payable to Laczko in the amount of $1,500
    for delay.

[17]

The
    Alexander asserts that he did not attend the motion, and again blames his
    lawyer for not advising him of the outcome.

[18]

On
    March 21, 2012, Laczko received an unsworn affidavit of documents from the moving
    parties. The responding partys affidavit reflects that the motion was
    adjourned
sine die
to be brought back, if necessary, once Laczko had
    had an opportunity to review the disclosed documents.

[19]

On
    April 3, 2012, Joslin provided a second report detailing omissions in the
    affidavit of documents provided by the moving parties.  The April Joslin report
    indicated that Alexander had failed to produce a substantial number of the
    documents agreed to in the Minutes of Settlement, including bank statements and
    financial statements relating to the partnership property. In addition, very
    few copies of negotiated cheques were provided to substantiate expenses charged
    to the partnership property.

[20]

Laczko
    brought the motion to strike back on May 8, 2012.  According to Laczko, it was
    adjourned from May 8 to May 22, 2012 at the request of the moving parties
    lawyer.  Although Alexander was aware that the motion was being heard May 22,
    he provided no responding material.

[21]

Alexander
    swears that his lawyer told him it would be a good idea for him to attend the
    May 22 hearing, but that he did not say why. He also swears that his lawyer
    never gave him a copy of the April Joslin report. According to his affidavit,
    Alexander was simply aware that the motion to strike was coming back before the
    court, by reason of alleged deficiencies in disclosure.

[22]

However,
    he was aware of the disclosure required by the June 2011 Joslin report and the
    November 2011 Minutes of Settlement, which he had signed. More generally,
    Alexander should have been aware, as a paralegal, of his obligation to provide
    disclosure in relation to an ongoing litigation. Even if he did not have a copy
    of the April 2012 Joslin report, he must therefore have known, for example,
    that he had not produced such basic disclosure as the financial statements for
    the joint venture for 2008.

[23]

In
    her endorsement, the motion judge made the following statement:

[N]o sworn statement is provided by the defendant explaining
    why the doc. has not been provided.  If Mr. Joslin is wrong in his assessment,
    a response should have been filed by the defendant; it was not.  When the
    parties sign Minutes, it should not be so difficult to obtain compliance. The
    defendant is not proceeding in a fair or appropriate fashion.

[24]

She
    granted the motion, and ordered that the statement of defence of Alexander and
    of Mercedes be struck. As discussed in greater detail below, I do not believe
    she erred in principle in exercising her discretion to grant the motion.

[25]

Alexander
    filed a further affidavit in support of this motion in which he says that he
    does not specifically recall when his lawyer gave him a copy of the April
    Joslin report, but that he did not have sufficient time to respond to it by way
    of further production or other answer prior to May 22, 2012. He provides no
    explanation as to why he did not file materials on the motion to this effect.

[26]

In
    his further affidavit, Alexander undertakes to produce all of the additional
    documents specified in the April Joslin report in his possession or control. He
    states that he emailed the financial statements for the joint venture to 2008
    to the Laczkos lawyer on October 31, 2012. The respondent acknowledges receipt
    of some financial documentation relating to 2008 in early November, 2012. No
    explanation has been provided as to why these documents werent provided
    earlier.

[27]

Alexander
    also states that the first time he learned about the outstanding $1,500 costs
    order of Lococo J. was at the May 22 hearing. He says that his lawyer told the
    court that he would need another sixty days to pay the costs order, and that
    his attempt to speak to his lawyer to correct this misstatement was rebuffed.

[28]

Alexander
    left before Milanetti J. delivered her decision. He alleges that despite
    attempts to find out the result of the May 22, 2012 hearing from his lawyer, it
    was not until June 5, 2012 that he learned his defence had been struck.

[29]

The
    non-payment of the costs order clearly figured in the decision of the motions
    judge, considering the following statement in her endorsement:

Each time the plaintiff has to come back to Court, he has to
    pay his LLB [lawyer].  Even if I did not strike, Id need to impose timelines
    and costs of today would be payable.  Based on the track record before me, I
    have no confidence that such Orders would be complied with.  The defendant
    provided me no solace in this regard; seeking, rather an additional 60 days to
    pay the 1
st
costs Order.

[30]

The
    order of May 22 was a document of public record that Alexander, as a paralegal,
    certainly would have known how to access had he cared to do so. Further,
    although a lawyers conduct may be relevant in assessing a partys explanation
    for delay, the opposing party is not responsible for the alleged shortcomings
    of the other partys lawyer.

[31]

A
    solicitor is an agent of his client:
Birjasingh v. Coseco Insurance Co.
(2000), 182 D.L.R. (4th) 751, at para. 11. This principle is often invoked in
    support of a lawyers capacity to act on behalf of his or her client. However,
    it also means that, vis-a-vis the other party, it is generally the client who
    is responsible for the actions of the clients lawyer. This is not an overly
    harsh approach, especially in the circumstances of this case. As noted by this
    court in
Machacek v. Ontario Cycling Assn.,
2011 ONCA 410, at para.
    10, the appellants are not left without a remedy as they still have recourse
    through an action in solicitors negligence.

[32]

Alexander
    states that the striking of his statement of defence has deprived him of a
    legitimate defence in the matters originally before Small Claims Court, and
    that he has now become personally liable for the payment of these contested
    invoices. He is prevented from bringing third party actions against the owners
    of property where the plaintiff alleged he had done work in his invoices.

[33]

Insofar
    as the merits of the small claims matters are concerned, Alexander made the
    following statement in a letter to Laczko, dated June 18:

If you retract your last two claims I will pay you for all of
    the invoices that you have submitted to me to this day.  We both know that you
    deserve to be paid for the work invoices you submitted to me, but the last two
    small claims are nonsense and I am not paying for them.  Otherwise, expect to
    gain nothing without a fight and be ware [sic] that I will refute all your
    claims whatever they may beexpect these lawsuits to go on for years and get
    nothing from Cathcart!

Cathcart is a partnership property. These statements
    diminish, to say the least, the strength of Alexanders position with regard to
    the small claims matters.

[34]

As
    to prejudice, the moving parties submit that the motion
judge failed to consider the question of prejudice to the responding party  or
    lack thereof, according to the moving parties  before striking their statement
    of defence and exposing them to a claim for $50,000. I disagree. The motion
    judges comments concerning the cost to Laczko of the court appearances
    necessary to enforce its right to disclosure in the Minutes was an assessment
    of prejudice. One might also infer that the motion judge was of the opinion
    that prejudice was accruing from her comment that [t]he defendant is not
    proceeding in a fair or appropriate fashion.

[35]

Indeed,
    there is significant evidence before me that the moving parties failure to
    make timely disclosure has caused and is causing prejudice to the responding
    party. Alexander states that the joint venture has been insolvent since August
    4, 2009. The documentation to support this statement has not been provided. The
    certificate of outstanding realty taxes on the property shows taxes in arrears
    of $32,316.87. Alexander states that he has an arrangement in place with the
    City of Hamilton to pay $750 a month, which he has been doing. While the joint
    venture may be insolvent, why make these payments unless there is some equity
    in the property?

[36]

Alexander
    also states in his supplementary affidavit:

In order to complete the original purchase of the property, I
    borrowed $52,000 on a line of credit.  This was registered in the form of a
    second mortgage on the joint venture property. The project did not generate
    sufficient funds to make payments on this mortgage.  I assigned this mortgage
    to a numbered company owned by my wife who has issued a Notice of Sale.

[37]

While
    Alexander complains that the striking of his statement of defence has exposed
    him to a judgment for $50,000 and that his legitimate set-offs claimed will not
    be accounted for, the moving parties delay and lack of disclosure has denied
    the responding party the opportunity to finalize his actions against them. It
    has also exposed the responding party to a continuing deterioration of his
    interest in the partnership property.

[38]

When
    this history is considered as a whole, I am of the opinion that to grant the
    relief requested by the moving parties would cause prejudice to the responding
    party, that there is little merit to the appeal, and that the justice of the
    case does not require that leave be granted.  Accordingly, for the reasons
    given, the motion to extend the time to appeal is dismissed.

[39]

The
    responding party is entitled to his costs of the motion before me and may make
    submissions in writing of no more than two pages concerning its bill of costs.
    The responding partys submissions are to be made within five days of the
    release of these reasons. The moving parties shall have five days from the
    filing of the responding partys submissions to respond in writing and shall
    similarly limit their submissions to two pages.


COURT OF APPEAL FOR ONTARIO

CITATION:
Le Feuvre (Re), 2012 ONCA 843

DATE: 20121129

DOCKET: C55462

Goudge, Rouleau JJ.A.
    and Ray J. (
ad hoc
)

IN THE MATTER OF: GEOFFREY LE FEUVRE

AN APPEAL UNDER PART XX.1 OF THE
CODE

Geoffrey Le Feuvre, appearing in person

Anita Szigeti, amicus curiae

Karen Shai, for the respondent

Heard: November 26, 2012

On appeal against the disposition of the Ontario Review
    Board dated, February 7, 2012.

APPEAL BOOK ENDORSEMENT

[1]

In our view, the Boards decision was both reasonable and based on the
    evidence before it.

[2]

Although the Board did not agree with his recommendation, Dr. Woodsides
    evidence is a more than sufficient basis for an expert Board such as this to
    conclude that their order represented the least onerous, least restrictive
    disposition for the appellant at this time.

[3]

Nor was there any basis given that conclusion, for the Board to engage
    in an inquiry into what might happen beyond the year to which their decision
    applies. If the appellant can meet Dr. Woodsides expectations, this will be
    important for the Boards next annual hearing of his case, which is only
    several months away.

[4]

The appeal must be dismissed.


COURT OF APPEAL FOR ONTARIO

CITATION:
Locking v. Armtec
    Infrastructure Inc., 2012 ONCA 774

DATE: 20121114

DOCKET: C54955

Armstrong, Watt and Pepall JJ.A.

BETWEEN

Keith Locking

Plaintiff (
Appellant
)

and

Armtec
    Infrastructure Inc., Scotia Capital Inc., TD Securities Inc., BMO
    Nesbitt Burns Inc., Charles M. Phillips, James R. Newell, Robert
    J. Wright, Ron V. Adams, Don W. Cameron, Brian W.
    Jamieson, John E. Richardson and Michael S. Skea

Defendants

Proceedings under the
Class
    Proceedings Act
,
1992

AND BETWEEN

Bruce Simmonds, Robert
    Grant and Gordon Moore

Plaintiffs (
Respondents
)

and

Armtec
    Infrastructure Inc., Charles M. Phillips, James R. Newell, Michael
    S. Skea, Donald W. Cameron, Scotia Capital Inc., TD
    Securities Inc. and BMO Nesbitt Burns Inc.

Defendants

Proceedings under the
Class
    Proceedings Act
,
1992

Earl A. Cherniak, Q.C., for Siskinds
    LLP, counsel to the plaintiff/appellant Keith Locking

Paul J. Pape and David S.
    Steinberg, for Sutts, Strosberg LLP, counsel to the plaintiffs/respondents
    Bruce Simmonds, Robert Grant and Gordon Moore

Heard: May 22, 2012

On appeal from the order of
    Justice Bruce G. Thomas of the Superior Court of Justice, dated January 20,
    2012.

By the
    Court:

Background

[1]

Bruce Simmonds, Robert Grant and Gordon Moore commenced proceedings against
    Armtec Infrastructure Inc. and others (the Simmonds action) under the
Class
    Proceedings Act, 1992
, S.O.
1992
, c. 6 (the Act). Their counsel is Sutts, Strosberg
    LLP. So did Keith Locking (the Locking action). His counsel is Siskinds LLP. The
    plaintiffs in the two actions each sought to have carriage of the class action.

[2]

On January 20, 2012, the motion judge ordered that:

-

the motion for carriage made by the plaintiffs in the Simmonds  action
    be granted;

-

the motion for carriage made by the plaintiff in the Locking
    action be dismissed; and

-

the Locking action be stayed.

[3]

Keith Locking appealed that order to the Court of Appeal.

[4]

This court subsequently advised the parties that it had concluded that
    it did not have jurisdiction to hear this appeal and that the appeal lay to the
    Divisional Court with leave. These are the reasons for that decision.

Scheme of the Act

[5]

The majority of appeals under the Act are to the Divisional Court. This
    is the legislative scheme. So, for example, appeals from a certification order
    or a refusal to certify are to the Divisional Court. Numerous decisions
    involving appeals to the Divisional Court in class proceedings reflect this
    scheme: see e.g.
Chadha v. Bayer Inc.
(2001), 54 O.R. (3d) 520 (Div.
    Ct.), affd (2003), 63 O.R. (3d) 22 (C.A.);
Markson v. MBNA Canada Bank
(2005), 78 O.R. (3d) 39 (Div. Ct.), affd (2007), 85 O.R. (3d) 321 (C.A.);
Irving
    Paper Ltd. v. Atofina Chemicals Inc.
, 2010 ONSC 2705, 103 O.R. (3d) 296;
Fischer
    v. IG Investment Management Ltd.
, 2011 ONSC 292, 104 O.R. (3d) 615 (Div.
    Ct.), affd 2012 ONCA 47, 109 O.R. (3d) 498.

[6]

Under s. 30(3) of the Act, only appeals from a judgment on common issues
    or a final order that deals with the aggregate assessment of monetary relief
    are expressly stated to be to the Court of Appeal.

[7]

In
Dabbs v. Sun Life Assurance Co. of Canada
(1998), 41 O.R.
    (3d) 97 (C.A.), leave to appeal to S.C.C. refused, [1998] S.C.C.A. No. 372,
    this court noted that under the Act, rights of appeal to the Court of Appeal
    are set out in s. 30(3) of the Act. In that case, the court stated that s.
    30(3) took precedence over and excluded provisions of general application such
    as s. 6(1)(b) of the
Courts of Justice Act,
R.S.O. 1990, c. C.43. This
    commentary was in the context of a representative plaintiffs motion to quash
    an appeal of a certification order and settlement approval order that had been
    brought by a class member. The appeal was quashed on the basis that the class
    member was not a party to the proceeding and, based on s. 30(3) which speaks of
    a partys right to appeal, had no standing to bring the appeal. The class
    member unsuccessfully attempted to rely on s. 6(1)(b) of the
Courts of
    Justice Act
, which permits appeals to the Court of Appeal from a final
    order of the Ontario Court (General Division) (now the Superior Court of
    Justice). As the specific provisions of the Act confer a right of appeal to the
    Court of Appeal on a party and not on a class member, they took precedence over
    the more general language found in s. 6(1)(b) of the
Courts of Justice Act
,
    which was also an earlier statute.

Courts of Justice Act

[8]

Where the Act does not specifically address the rights and avenues of
    appeal, s. 6(1)(b) of the
Courts of Justice Act
governs appeals to the
    Court of Appeal in class proceedings. It states that an appeal lies to the
    Court of Appeal from a final order of a judge of the Superior Court of Justice,
    except an order referred to in clause 19(1)(a) or an order from which an appeal
    lies to the Divisional Court under another Act.

[9]

The distinction between a final and interlocutory order was described by
    Justice Middleton in
Hendrickson v. Kallio
, [1932] O.R. 675 (C.A.), at
    p. 678:

The interlocutory order from which there is no appeal is an
    order which does not determine the real matter in dispute between the parties
    the very subject matter of the litigation, but only some matter collateral. It
    may be final in the sense that it determines the very question raised by the
    application, but it is interlocutory if the merits of the case remain to be
    determined.

[10]

So,
    for example, an appeal in a class proceeding from an order striking out a
    statement of claim as disclosing no reasonable cause of action is to the Court
    of Appeal. So too is an appeal from an order for summary judgment in which a
    class proceeding is dismissed.

This Appeal

[11]

As
    a carriage order is not specifically addressed in the Act, the
Courts of
    Justice Act
governs the appeal route in this case. As such, the issue
    before us is whether the motion judges order was final or interlocutory. In
    our view, it was interlocutory.

[12]

While
    this court has not addressed this issue before, some other jurisdictions in
    Canada have.

[13]

The
    Court of Appeal for British Columbia in
W.(A.) (Litigation Guardian of) v.
    British Columbia
, 2003 BCCA 448, 17 B.C.L.R. (4th) 263, and the Court of
    Appeal for Newfoundland and Labrador in
H.P. Management Inc. v.
    Newfoundland and Labrador (Minister of Finance)
, 2007 NLCA 65, 270 Nfld.
    & P.E.I.R. 277, both held that an order granting carriage of a proposed
    class action was interlocutory in nature and not final, and that in their
    jurisdictions, leave to appeal was therefore required. Those cases both involved
    stays of the action of the unsuccessful party on the carriage motion. Both
    courts held that the order staying the action did not bring an end to the
    proceedings, as the action was not stayed for all purposes, but simply as a
    class action. The unsuccessful plaintiffs could still prosecute their lawsuit
    as an ordinary action. Furthermore, if the plaintiff with carriage succeeded in
    obtaining certification, the unsuccessful plaintiffs could opt out of the class
    and continue with their own action. The only effect of the impugned order was
    to prevent the unsuccessful plaintiffs from bringing an application to have the
    action certified as a class proceeding.

[14]

As
    noted at para. 17 of
H.P. Management Inc
., the stay of proceedings did
    not determine or terminate the claim: The effect is simply to place the claim
    on hold until the rights of the class have been determined through the
    representative plaintiff.

[15]

While
    in the appeal before us, the motion judge did not expressly state that the
    Locking action was stayed for the purposes of the class action only, this was
    implicitly the case. As such, the order was interlocutory. Furthermore, to the
    extent possible, there is some advantage to uniformity of approach in class
    proceedings in Canada.

[16]

The
    cases relied upon by the appellant are distinguishable from the case before us.
    Some dealt with stays based on
forum non conveniens
or arbitration.
    These decisions involved access to the court system or the disposition of a
    substantial issue forming part of the dispute between the parties, not the
    format by which an action would proceed through the court system.

[17]

The
    appellant has not lost his right to sue the defendants. He may remain as part
    of the
proposed class action and may also seek to
    actively participate to protect his interests pursuant to s. 14 of the Act. He
    may also opt out and pursue his individual action independently.

[18]

For
    these reasons, we conclude that the motion judges order is interlocutory. An
    appeal lies to the Divisional Court with leave and not to the Court of Appeal.

[19]

Neither
    party before us raised the issue of jurisdiction, nor objected to the appeal
    proceeding in this court. In all of the circumstances, we are of the view that
    there should be no order of costs of this appeal.

Robert
    P. Armstrong J.A.

David
    Watt J.A.

S.E.
    Pepall J.A.

Released: November 14, 2012 DW


COURT OF APPEAL FOR ONTARIO

CITATION:
Martin v. Fleming, 2012
    ONCA 750

DATE: 20121105

DOCKET: C54393

Sharpe, Rouleau and Hoy JJ.A.

BETWEEN

Wendy Martin, Michael Martin, Kaitlynn Martin
    represented by her litigation guardian Wendy Martin and Jacob Martin represented
    by his litigation guardian Wendy Martin

Plaintiff (Appellant)

and

Krystal Nicole Fleming

Defendant (Respondent)

Jeffrey Strype and Kyle Smile, for the plaintiff
    (appellant)

Christine Fotopoulos and Tamara Tomomitsu, for the
    respondent Nicole Fleming

Jamie Pollack, Kerri, Knudsen, for the defendant
    Campoverde

Gustave Garrido and Sheila Shechian, for the defendant
    Troy Sisoun

Brian Cameron, for the intervener Ontario Trial Lawyers

Derek V. Abreu, for the intervener CDL

Heard and released orally: October 29, 2012

On appeal from the order of Justice Thea P. Herman of the
    Superior Court of Justice, dated September 26, 2011.

ENDORSEMENT

[1]

This appeal involves the interpretation of the
Insurance Act
,
    R.S.O. 1990, c. I.8, s. 267.5(7) which stipulates certain amounts to be
    deducted from non-pecuniary damage awards for bodily injury or death arising
    directly or indirectly from the use or operation of an automobile. On a Rule 21
    motion to determine a point of law, the motion judge ruled that where a
    plaintiff has been involved in two accidents and the actions are tried together
    to facilitate the assessment of damages, the plaintiff is subject to one
    deductible for each claim.

[2]

We see no merit in the appeal. We agree with the reasons of the motion
    judge who concluded at paras. 27-30:

[27] In my opinion, the application of individual deductibles
    to each accident or action is consistent both with the wording of the
    legislative provision, when read in the context of the legislation as a whole,
    and the approach taken in other decisions.

[28] The plain meaning of s. 267.5(7) is that the court
    determines the amount of general damages in an action by first determining the
    general damages in that action and then reducing that amount by the amount of
    the statutory deductible.

[29] Global assessment is a methodology for determining damages
    where damages from multiple accidents overlap. Even where the court undertakes
    a global assessment, it must still determine the amount of general damages
    attributable to each action. It is in keeping with the wording of the provision
    and the scheme as a whole that, once the court has allocated the general
    damages for the individual action, it then reduces that amount by the amount of
    the statutory deductible.

[30] I conclude that the statutory deductibles apply to each
    action. The plaintiffs motion is therefore dismissed.

[3]

The
Charter
values approach to interpretation advanced by the
    intervener Ontario Trial Lawyers Association was not made before the motion
    judge. It is conceded that a court would only give effect to that argument if
    the legislation were ambiguous. This legislation is not ambiguous and therefore
    we reject the argument.

[4]

Accordingly, the appeal is dismissed with costs fixed in the total
    amount of $15,000 to be allocated equally as between the three respondents.

Robert J. Sharpe J.A.

Paul
    Rouleau J.A.

Alexandra
    Hoy J.A.


COURT OF APPEAL FOR ONTARIO

CITATION:
Martin v. Martin, 2012
    ONCA 814

DATE: 20121122

DOCKET: M41791 (C55412)

Blair, Rouleau and Tulloch JJ.A.

BETWEEN

Linda Jean Martin

Applicant (Respondent on Appeal)

(Moving Party on
    Motion)

and

Brian Stephen Martin

Respondent
    (Appellant)

(Responding Party on Motion)

Theodore C. Dueck, for the moving party (respondent on
    appeal)

Brigitte Gratl, for the respondent (appellant)

Heard: November 21, 2012

Motion to dismiss or quash appellants notice of appeal.

ENDORSEMENT

[1]

In our view, most of the orders the appellant seeks to attack are
    interlocutory in nature are therefore not within the jurisdiction of this
    Court. The motion to quash turns primarily on the orders providing for the sale
    of the matrimonial home and the underlying rights relating to that sale. We
    agree these latter orders are final in nature because they finally determine
    the application with respect to the sale. However, there was no automatic stay
    of the orders of Haines J. respecting the sale and the practical reality is
    that the property has been sold. The proceeds of the sale are paid into court
    to await the still-to-be determined rights of the parties to the proceeds. The
    appeal with respect to the sale orders is therefore moot, and in our view, is
    not one of those rare appeals that should be allowed to proceed notwithstanding
    that it is moot. See
Cada v. Cada
2003 Carswell Ont. 3858 (Ont. C.A.).

[2]

The motion to quash the appeal is therefore granted. The moving party is
    entitled to the costs of the motion fixed in the amount of $5,000 inclusive
    disbursements and all applicable taxes.


COURT OF APPEAL FOR ONTARIO

CITATION:
McCracken v. Canadian National Railway
    Company,
2012 ONCA 797

DATE: 20121120

DOCKET: C52635

Winkler C.J.O., Laskin and Cronk JJ.A.

BETWEEN

Michael Ian McCracken

Plaintiff (Appellant/

Respondent by
    Cross-Appeal)

and

Canadian National Railway Company

Defendant (Respondent/

Appellant by
    Cross-Appeal)

Louis Sokolov, Peter L. Roy, Steven Barrett, David F.
    OConnor and Sean M. Grayson, for the appellant/respondent by cross-appeal

Guy J. Pratte, Morton G. Mitchnick, Sylvie Rodrigue,
    Jeremy J. Devereux and Michael Kotrly, for the respondent/appellant by
    cross-appeal

Scott Hutchinson, Aaron
    Dantowitz and Benjamin Kates, for the Law Foundation of Ontario

Heard:   February 28 and 29, 2012

On appeal from the order of Justice Paul M. Perell of the
    Superior Court of Justice, dated August 17, 2010, with reasons reported at 2010
    ONSC 4520, 3 C.P.C. (7th) 81, and on appeal from the costs order of Justice
    Paul M. Perell, dated November 2, 2010, with reasons reported at 2010 ONSC
    6026, 100 C.P.C. (6th) 334.

COSTS ENDORSEMENT

Winkler C.J.O.:

[1]

This courts judgment in
McCracken v. Canadian National Railway
    Company
,
2012 ONCA 445,
    was released concurrently with two other appeals in a trilogy of class actions
    against federally-regulated employers claiming unpaid overtime pay:
Fulawka
    v. Bank of Nova Scotia,
2012 ONCA 443, and
Fresco v. Canadian Imperial
    Bank of Commerce
, 2012 ONCA 444. In
McCracken
, this court
    overturned the motion judges order certifying the proposed action. The parties
    are to return before the motion judge to make oral submissions on the costs of
    the certification motion.

[2]

The court has now had the opportunity to review submissions on the costs
    of the appeal of the successful appellant, Canadian National Railway Company, as
    well as the joint submissions of the proposed representative plaintiff, Michael
    McCracken, and the Law Foundation of Ontario. The Class Proceedings Committee of
    the Law Foundation approved the proposed class action for funding support from
    its Class Proceedings Fund.

[3]

CN seeks partial indemnity costs of the appeal in the amount of
    $300,000, including disbursements in the amount of $13,293.49 and taxes. CNs counsel
    indicate that this amount represents approximately one-third of the actual costs
    incurred ($931,464) and reflects a discount from the maximum allowable on a
    partial indemnity scale ($487,799).

[4]

The plaintiff and the Law Foundation submit that no costs should be awarded
    for the appeal, but if they are, the award should not exceed $50,000.

[5]

The plaintiff and the Foundation complain that as much as $229,074 of
    the actual fees appearing in CNs costs outline ($127,050 on partial indemnity)
    and an unspecified portion of the claimed disbursements, arise from work done
    in connection with the Divisional Court proceedings. These proceedings were
    resolved on consent and on a no-costs basis and are not properly claimed as
    costs of the proceedings in this court. As noted above, however, CN reduced the
    amount of its alleged actual costs on a partial indemnity basis by
    approximately $180,000, which neutralizes the concern raised by the plaintiff
    and the Foundation.

[6]

I would not accept the position of the plaintiff and the Law Foundation that
    no costs should be awarded to CN for the appeal in this court. The outcome of
    the appeal, its complexity, the principle of indemnity and the reasonable
    expectations of the plaintiff all militate in favour of a significant partial
    indemnity costs award.

[7]

This was a two-day hearing and each side raised a host of issues by way
    of appeal and cross-appeal. It should come as no surprise to the plaintiff or
    the Law Foundation  given the $300 million claimed in the action and the almost
    $750,000 in costs that the plaintiff was awarded on the certification motion  that
    the appeal would be hard-fought and would be argued by experienced counsel on
    behalf of CN.

[8]

However, in furtherance of the goals of the
Class Proceedings Act,
    1992
, S.O. 1992, c. 6,
the
    court will also consider whether any of the factors set out in s. 31(1) of that
    Act  a test case, a novel point of law, a matter of public interest
apply
: see
Ruffolo v. Sun Life
    Assurance Co.
(2009), 95 O.R. (3d) 709 (C.A.). I agree with the position of
    the plaintiff and the Law Foundation that this appeal involved novel points of
    law. Indeed, in its factum filed in support of the request for leave to appeal
    the certification order to the Divisional Court, CN took the position that the
    proposed action engages serious, novel legal issues. It raises important
    questions regarding how misclassification can be heard collectively, if at
    all.

[9]

I also agree with the plaintiff and the Foundation that the proposed
    action was animated by public interest concerns insofar as this class
    proceeding was intended to afford an efficient means to obtain collective redress
    for employees of a federally-regulated company. The public interest issue is
    whether or not a misclassification case can properly be made the subject matter
    of a class proceeding. This public interest purpose is consistent with the fundamental
    objective of the
CPA
of providing enhanced access to justice:
Pearson
    v. Inco Ltd.
(2006), 79 O.R. (3d) 427, at para. 13.

[10]

I
    reject CNs argument that access to justice considerations are not involved
    because the Class Proceedings Fund will indemnify the representative plaintiff
    for any costs award. The Fund was created to facilitate access to justice. If
    the Fund were required to absorb steep cost awards imposed on litigants even
    though the proposed action displays the factors in s. 31(1) of the
CPA
,

this
would have an undesirable chilling effect on class
    proceedings.

[11]

On
    the other hand, it must be recognized that class actions come at a cost to
    defendants. Indemnifying parties  such as class counsel or the Law Foundation
     must assess the risks of an unsuccessful litigation strategy and balance them
    against the possible rewards: see
Singer v. Schering-Plough Canada Inc.
,
    2010 ONSC 1737, 87 C.P.C. (6th) 345, at para. 20. The risk of adverse cost
    awards must factor into the decision to fund and indemnify a proceeding. The
CPA
was never intended to insulate representative plaintiffs from the possible
    costs consequences of unsuccessful litigation:
David Polowin Real Estate
    Ltd. v. Dominion of Canada General Insurance Co.
(2008), 93 O.R. (3d) 257
    (C.A.), at para. 29.

[12]

Considering
    that the appeal raised novel legal issues and that the proposed class action
    engaged the access to justice rationale animating the
CPA
, I would fix
    costs at a significantly lower amount than is being claimed by CN. However, I
    would not give effect to the plaintiff and the Foundations submission that an
    order of no costs  or, in the alternative, an award of not more than $50,000
    would be fair and reasonable in this case. Given the complexity of the appeal,
    the amount at stake in the litigation, and CNs complete success on appeal, in
    my view, costs of the appeal should be fixed on a partial indemnity scale at $60,000,
    inclusive of disbursements and taxes.

W.K. Winkler
    CJO

I agree John Laskin J.A.

I agree E.A. Cronk J.A.