COURT OF APPEAL FOR ONTARIO

CITATION: Marshallzehr Group Inc. v. Ideal
    (BC) Developments Inc., 2021 ONCA 229

DATE:  20210413

DOCKET:
C68419

Rouleau, Brown and Miller JJ.A.

BETWEEN

Marshallzehr Group Inc.

Plaintiff/Defendant
    by Counterclaim

(Respondent)

and

Ideal (BC) Developments Inc., Ideal (BC2) Developments Inc.,

2490568 Ontario Inc., 2490564 Ontario Inc. IDEAL Developments Inc.,
    and Shajiraj Nadarajalingam

Defendants/Plaintiffs
    by Counterclaim

(Appellants)

Mark A. Russell, for the appellants

Stephen Schwartz, for the respondents

Heard: March 29, 2021 by video conference

On appeal from the judgment of Justice Paul
    M. Perell of the Superior Court of Justice, dated March 11, 2020,
with reasons reported at 2020 ONSC 1547, 100 B.L.R. (5th) 66
.

BROWN J.A.:

I.        OVERVIEW

[1]

The appellants, Ideal (BC) Developments Inc.,
    Ideal (BC2) Developments Inc., 2490568 Ontario Inc., 2490564 Ontario Inc.,
    Ideal Developments Inc., and Shajiraj Nadarajalingam (hereafter collectively Ideal),
    appeal the judgment of the motion judge that ordered them to pay the
    respondent, MarshallZehr Group Inc. (MZ), the sum of $508,071.09 and
    dismissed Ideals counterclaim against MZ.

[2]

By Commitment Letter dated October 31, 2018 (the
    CL), and executed by Ideal on November 8, 2018, MZ was prepared to provide Ideal
    with financing for a residential real estate project. Two of the appellants,
    Ideal Developments Inc. and Shajiraj Nadarajalingam, were to act as guarantors
    of the indebtedness.

[3]

According to the CL: (i) MZ intended to
    syndicate the loan and lend Ideal $15.2 million (the Loan); (ii) the Loan was
    to act as a first mortgage land loan for Ideals development of the project; (iii)
    the CL stipulated that the funds for the project were to consist of the Loan plus
    $5.9 million in equity; (iv) the loan would be for a term of 13 months; (v) the
    Loan would consist of three facilities, with the facilities bearing interest
    rates ranging from Prime + 5.3% per annum (floor rate of 9.25%) on the largest
    facility to Prime + 10.05% (floor rate 14.0%) on the smallest;  (vi)
    subordinate financing was subject to MZs consent; (vii) the closing date for
    the Loan was scheduled for December 5, 2018; and (viii) MZ was not required to
    advance any funds prior to the Borrower having fulfilled to the Lenders
    satisfaction the Initial Funding Conditions specified in s. 2.1 of the CL.

[4]

By December 17, 2018 MZ had given Ideal notice that
    the syndicated lenders had started to advance funds. MZ informed Ideal on
    December 21, 2018 that interest was beginning to accrue on the Loan. Thereafter,
    in accordance with the terms of the CL, MZ advanced the syndicated funds to its
    counsel, to be held in trust pending Ideals satisfaction of the Initial
    Funding Conditions.

[5]

In the result, the Loan never closed, and no funds
    were ever advanced to Ideal. By letter dated January 23, 2019, MZ notified Ideal
    that it was ending the CL, stating, in part:

Please accept this letter as notice that the
    Lender is hereby terminating the Commitment Letter effective immediately in
    accordance with the terms thereof.

Notwithstanding the Lenders unilateral right
    to cancel the Commitment Letter at any time and as it may determine, in its
    sole and unfettered discretion, we have been advised by our client that the
    Obligors have not met the Initial Funding Conditions set out in Part II,
    Section 2.1 therein.

[6]

MZ sought payment from Ideal of $553,899.48 for
    various fees and expenses in connection with the CL.

[7]

By letter dated February 28, 2019, Ideal took
    the position that MZ did not have the right to terminate the CL without providing
    notice and giving Ideal an opportunity to cure any default.

[8]

MZ brought this action seeking payment of
    various fees and expenses described in the CL. Ideal defended and, as well,
    counter-claimed for damages caused by MZs wrongful termination of the CL. MZ
    then moved for summary judgment, which the motion judge granted.

[9]

Ideal raises two main grounds of appeal. First,
    it submits that the motion judge erred in determining that MZ was entitled to
    end the loan facility under the CLs Cancellation provision and dismissing Ideals
    counterclaim. Second, Ideal argues that the motion judge erred in calculating
    the fees and expenses to which MZ was entitled upon cancellation of the CL.

II.       FIRST GROUND OF APPEAL: MZS RIGHT TO END THECOMMITMENT
    LETTER

A.      The issue stated

[10]

Ideals first ground of appeal concerns the
    motion judges interpretation of the CL, specifically the contractual basis of
    MZs right to end the CL in the circumstances, as well as the application of
    that interpretation to the facts of the case. The applicable standard of review
    is that articulated in
Sattva Capital Corp. v.
    Creston Moly Corp.
, 2014 SCC 53, [2014] 2 S.C.R.
    633,

and its progeny.

[11]

Ideal submits that when interpreting the CL the
    motion judge committed an error on an extricable question of law. It argues the
    motion judge failed to interpret the provisions of the contract as a whole,
    with the result that he failed to assign meaning to all the contested terms of
    the CL:
Ventas, Inc. v. Sunrise Senior Living Real
    Estate Investment Trust
(2007), 85 O.R. (3d) 254
    (C.A.), at para. 24;
Deslaurier Custom Cabinets
    Inc. v. 1728106 Ontario Inc.
, 2017 ONCA 293, 135
    O.R. (3d), at para. 58, leave to appeal refused, [2016] S.C.C.A. No. 249.

[12]

The contested terms of the CL are those that
    entitle MZ to bring its relationship with Ideal to an end. The first is found
    in Part I of the CL. Headed Cancellation, the provision states:

The Lender may on demand require immediate
    payment of all amounts outstanding or accrued in connection with this
    Commitment.
The Lender may at any
    time, for any reason and without notice, cancel the undrawn portion of the Loan
. [Emphasis added.] (Hereafter the Cancellation Provision.)

[13]

The other is contained in Part V of the CL,
    Default Provisions.

Section
    5.1 identifies events of default, which include the neglect by any Obligor (the
    named borrowers and guarantors) to observe or perform any covenant or
    obligation contained in any Document on its part to be observed or performed
    and, such Obligor shall fail (in the case of those defaults which can be
    rectified by such Obligor) to remedy such default within a period of thirty
    (30) days after the giving of notice

[14]

Section 5.2 provides that [u]pon the occurrence
    of any Event of Default that has not been cured within the timelines set out
    herein, the Lender by written notice to the Borrower (an Acceleration Notice)
    shall be entitled to: a) declare the Loan and the right of the Borrower to
    apply for further Advances to be terminated; and b) declare all Obligations
    of the Borrower to the Lender (including, without limitation, the all unpaid
    fees whether or not deemed earned) to be immediately due and payable  without
    further demand

[15]

I will refer to ss. 5.1 and 5.2 collectively as
    the Default and Demand Provisions.

[16]

Before the motion judge, Ideal argued that the
    Default and Demand Provisions governed MZs ability to terminate the CL prior
    to the closing of the loan transaction. It contended that MZ had wrongfully
    terminated the CL because it had failed to give Ideal notice that it had
    committed an event of default and afford Ideal an opportunity to cure the
    default.

[17]

The motion judge did not accept that submission.
    He held that MZs January 23, 2019 letter constituted the exercise by MZ of its
    right to end the relationship with Ideal under the Cancellation Provision. He
    stated:

Read literally, the Cancellation Provision
    required MZ to have a reason for the cancellation and its expressed reason was
    that Ideal had not satisfied the Initial Funding Conditions. Section 2.1 of the
    Commitment Letter provided that MZ shall not be required to advance any funds
    prior to Ideal having fulfilled to the Lender's satisfaction the funding
    preconditions.

Although MZ speaks of Ideal defaulting with
    respect to the Initial Funding Conditions, more felicitous and legally accurate
    language is that Ideal had not satisfied the pre-conditions for the loan. More
    importantly, by January 22, 2010 [
sic
] it was apparent that Ideal
    would not or could not satisfy the pre-conditions.

[18]

Ideal advances two arguments in support of its
    position that the motion judge erred in holding that MZ was entitled, in the
    circumstances, to utilize the Cancellation Provision. First, a proper
    interpretation of the CL as a whole requires giving meaning and priority to the
    Default and Demand Provisions. Second, MZ did not have a legitimate reason to
    terminate the CL and, as a result, MZ failed to exercise its discretionary
    powers under the CL in good faith.

B.      Analysis

The interpretation of the CL

[19]

I am not persuaded that the motion judge erred
    on an extricable question of law. In my view, his interpretation gave effect to
    all the CLs terms.

[20]

The terms of the CL cover two periods of time in
    the relationship between MZ and Ideal: (i) the period from the date of
    execution of the CL to the closing of the transaction by the Initial Advance of
    funds to Ideal; and (ii) the period following the Initial Advance of funds
    through to the end of the 13-month term of the Loan. When the CL is examined in
    its entirety, the provisions relating to the pre-closing period are, roughly
    speaking, found in the following portions of the CL: (a) s. 2.1, which specifies
    the Initial Funding Conditions; and (b) Part III, which describes the security and
    documentation to be delivered by Ideal.  Those that concern the
    post-closing/post-Initial Advance period are: (c) s. 2.2, dealing with Funding
    Conditions for Borrower Draws (although the CL contemplated a single, Initial
    Advance); (d) Part IV, dealing with Borrowers Covenants; and (e) Part V, the
    Default Provisions. Parts I and VI, the General Provisions, contain terms that concern
    both periods of time.

[21]

Provisions of the CL clearly stated that MZ, as lender,
    was not required to advance any funds prior to Ideal, as borrower, fulfilling
    stipulated pre-conditions to MZs satisfaction. For example, Part VI states, in
    part: The execution of this letter does not obligate the Lender to advance any
    of the agreed funds unless all of the conditions to such advances have been
    satisfied to the satisfaction of the Lender and its solicitors.

[22]

When the motion judges reasons are read against
    that background, I am satisfied that his interpretation gave effect to the
    basic bargain agreed to by the parties and gave meaning to all the CLs terms.

[23]

Ideal contends that MZ could not use the
    Cancellation Provision because it merely permitted the Lender to cancel the
    undrawn portion of the Loan. Ideal points to the definition of Loan in the
    opening paragraph of the CL, which states:

This commitment letter confirms that
    MarshallZehr Group Inc. (the Lender) is prepared to provide financing (the
    Loan) for the Project conditional on the terms and conditions contained in
    this letter agreement (the Commitment).

[24]

In Ideals submission, the cancellation of the
    undrawn portion of the Loan would not amount to a termination of the CL or the
    Loan, which is what MZ purported to do in its January 23, 2019 letter. Instead,
    according to Ideal, any termination of the Loan required MZ to resort to the
    Default and Demand Provisions. Only if MZ gave notice of a default and an
    opportunity for Ideal to cure the default could it then proceed, under s. 5.2,
    to issue to Ideal an acceleration notice that would declare the Loan and the
    right of the Borrower to apply for further Advances to be terminated.

[25]

I do not regard the interpretation advanced by
    Ideal as a commercially reasonable one.  While I agree with the motion judges
    observation, at para. 45, that the Commitment Letter is far from plainly
    written, in my view his interpretation gave practical meaning to all the CLs
    terms and was commercially reasonable.

[26]

When MZ sent its January 23, 2019 letter, the
    parties had not closed the financing of the Loan. As a result, MZ had not
    advanced any funds to Ideal. The CL contemplated one advance of funds, the
    Initial Advance, which would comprise the entirety of the Loan. Accordingly, at
    the time of the January 23, 2019 letter the entirety of Loan remained undrawn
    because the loan transaction had not yet closed and no funds had been advanced.
    In those circumstances, the Cancellation Provision would be available to
    cancel the undrawn portion of the Loan. The effect of the cancellation would
    be to put an end to, or terminate, the CL.

[27]

By contrast, the following language of s. 5.2
    envisages a situation where the loan transaction has closed and some advance of
    funds has occurred: declare the Loan and the right of the Borrower
to apply for further Advances
to be terminated.
    [Emphasis added.] Section 5.2 of the CL contemplates circumstances where some
    portion of the Loan has been advanced, an uncured event of default has
    occurred, as a result of which the Lender can declare the Loan to be terminated
    and accelerate all obligations, with the Loan becoming immediately due and
    payable.

[28]

Is the language of the Cancellation Provision a
    perfect fit with only pre-closing circumstances? No. One could argue that its
    reference to the undrawn portion of the Loan covers a situation where the
    borrower already had made a draw and, therefore, the transaction had closed. But,
    in my view the motion judges interpretation was a more commercially reasonable
    one in the actual circumstances of this case: the Loan transaction had not
    closed; no advance had been made to Ideal; the CL contemplated a single,
    Initial Advance, not multiple draws; and MZ was under no obligation to
    advance funds before Ideal fulfilled the stipulated pre-closing conditions to
    MZs satisfaction.

[29]

I therefore conclude that the motion judge did
    not commit an error on an extricable question of law. His interpretation of the
    CL was a reasonable one, which gave practical recognition to the structure of the
    CL and meaning to all its terms. Accordingly, I see no reversible error in his interpretation
    of the Cancellation Provision and his conclusion that MZ could use the
    provision in the circumstances. Nor do I see any palpable and overriding error
    in his finding that by sending its January 23, 2019 letter MZ was purporting to
    exercise its right under the Cancellation Provision. That finding was available
    to the motion judge on the record.

The availability of the Cancellation
    Provision in the circumstances

[30]

Ideal also submits that its dispute with MZ
    about the terms of subordinate financing did not entitle MZ to exercise its
    rights under the Cancellation Provision.

[31]

Feature Corp. held an existing third mortgage on
    the project properties. Since the Subordinate Financing clause in Part I of
    the CL required MZs prior written consent to any junior mortgage, Ideal discussed
    with MZ terms for subordinating and postponing the third mortgage. The parties
    could not agree on the length of a standstill period during which the third
    mortgagee could not enforce its rights in the event of a default by Ideal: MZ
    wanted a standstill period for the entire term of its Loan; Ideal wanted only a
    90-day standstill period.

[32]

By email dated January 14, 2019, MZ repeated
    that it required a full standstill, observed that the issue had been addressed
    multiple times, and advised that the parties should move on from it. By further
    email dated January 16, 2019, MZ advised Ideal that [w]e will not limit the
    timeframe around our standstill clause.  On January 18, 2019, Ideals counsel formally
    wrote to MZ that its insistence on an indefinite standstill period was
    unreasonable as such a provision was not expressly required by the CL. Counsel
    advised that unless MZ altered its position and, as well, agreed to a $2
    million increase in the third mortgage, we will seek our clients instructions
    regarding termination of the Commitment Letter, without prejudice to their
    rights and remedies in law and equity. MZ remained firm in its position.

[33]

Ideal submits, in effect, that the language of
    the Subordinate Financing clause treats the parties inability to resolve the
    dispute over the standstill agreement as a default which, in turn, required
    MZ to resort to the Default and Demand Provisions, not the Cancellation
    Provision, to end the relationship.

[34]

I am not persuaded by that submission.

[35]

The Subordinate Financing clause uses the word
    default in two places, each involving a different circumstance. The first
    refers to a situation where Ideal obtains additional financing without MZs
    consent; the second is where an approved secondary lender issues a discharge
    certificate greater than zero without MZs consent.

[36]

Neither circumstance applied to the dispute
    between MZ and Ideal, which involved Ideals obligation to satisfy the Initial
    Funding Conditions for the Loan. Section 2.1(a) of the Initial Funding
    Conditions required the execution of all the security and ancillary loan
    agreements and documents before MZ was obligated to advance any funds. Ideals
    obligation under Part III of the CL required Ideal to deliver security in the
    form and on the terms acceptable to the Lenders solicitors, including (a) in
    s. III.j, postponements from such other creditors as the Lender may require
    upon completion of its due diligence and (b) in s. III.o, [s]uch further
    security  and ancillary documents and agreements as the Lender or its
    solicitors may, acting reasonably, deem necessary to adequately secure the Loan
    obligations and complete and perfect the Security.

[37]

The record discloses that Ideal was not prepared
    to agree to the form of subordination agreement acceptable to MZ. At para. 54
    of his reasons, the motion judge found that the negotiations over whether MZ
    would consent to the additional financing and about what would be the terms of
    the postponement, subordination and standstill agreement had reached a
    dead-end, which was a very serious impediment to going forward with the loan
    for both parties. I see no palpable and overriding error in that finding;
    ample evidence supported it.

[38]

The motion judge stated, at para. 52, that the
    Cancellation Provision required MZ to have a reason for the cancellation and
    its expressed reason was that Ideal had not satisfied the Initial Funding
    Conditions. Given the requirements of s. 2.1 regarding the Initial Funding
    Conditions and Part III regarding Security, I see no palpable and overriding
    error in the motion judges conclusion that the parties impasse over the terms
    of the Feature Corp. subordinate financing provided MZ with a legitimate reason
    to exercise its rights under the Cancellation Provision.

[39]

Ideal makes one further argument. In its
    statement of defence and counterclaim, Ideal pleaded that MZ breached its duty
    of good faith by unreasonably demanding a permanent standstill agreement from
    subordinate financiers in excess of its rights under the [CL] and by
    terminating the [CL] without proper notice of alleged default or providing a
    required cure period to remedy the same. Ideal did not advance that argument
    before the motion judge. However, during oral submissions on appeal, Ideal,
    relying on the recent decision of the Supreme Court of Canada in
Wastech
    Services Ltd. v. Greater Vancouver Sewerage and Drainage District
, 2021
    SCC 7, 454 D.L.R. (4th) 1, argued that MZ did not exercise its rights under the
    Cancellation Provision in a good faith manner.

[40]

I am not prepared to give effect to this
    submission. I put to one side the issue of whether it is open to Ideal to argue
    on appeal a pleaded defence that it elected not to pursue below in response to
    MZs motion for summary judgment. As well, the lateness of the hour at which
    Ideal has raised this issue has deprived the panel of the benefit of the
    parties considered submissions on how the principles articulated in
Wastech
would apply to a partys conduct in the pre-closing phase of a contractual
    relationship, such as in the present case. Nevertheless, I would observe that
    while
Wastech
states that contractual discretion must be exercised
    reasonably, in light of the purpose for which it was conferred, the decision
    notes that such a duty of good faith does not displace the detailed,
    negotiated bargain as the primary source of justice between the parties: at
    paras. 4 and 5.

[41]

In the present case, MZ was faced with a
    situation where: (a) Ideal had been unable to renew its existing first
    mortgage; (b) Ideal had agreed, in the CL, to use equity to source the balance
    of funds for the project but ultimately wanted to maintain and increase the
    amount of its third mortgage; (c) Ideal had agreed, in the CL, that MZs
    consent was required for any subordinate financing and relevant security  and
    ancillary documentation had to be satisfactory to MZ and its solicitors; and
    (d) Ideals counsel had put MZ on formal notice that its insistence on a total
    standstill was unreasonable and might lead Ideal to terminate the CL. Ideals
    position that its subordinate lender need only agree to a 90-day standstill on
    its enforcement rights understandably would cause MZ concern about the degree
    of additional risk it would be assuming if it were to advance funds to Ideal on
    that basis.

[42]

The agreed Initial Funding Conditions reflected
    many of the limits to the risk that MZ was prepared to assume in lending to
    Ideal. When viewed in the context of the entire agreement, the Cancellation
    Provision appeared to be designed, in part, to bring the relationship to an end
    if the borrower was unable or unwilling to satisfy the pre-conditions to
    lending. Faced with a potential borrower who was not prepared to conclude an
    agreement within the CLs agreed-upon risk limits, the Cancellation Provision was
    available for MZ to use to avoid such unbargained for risk. Again, recall that s.
    2.1 of the CL provided that MZ was not required to advance any funds until
    Ideal fulfilled the Initial Funding Conditions to MZs satisfaction. In those
    circumstances, I see nothing unreasonable about its use of the Cancellation
    Provision.

Conclusion

[43]

For those reasons, I am not persuaded by Ideals
    first ground of appeal. I see no basis to interfere with the motion judges
    conclusion that MZ was entitled to exercise the Cancellation Provision in the
    circumstances.

III.      SECOND
    GROUND OF APPEAL: THE RECOVERABLE FEES AND EXPENSES

[44]

The $508,071.09 judgment in MZs favour consists
    of awards for: (i) Standby Interest: $101,958.82; (ii) expenses consisting of
    payments by MZ for legal fees, document review, and planning advice: $60,112.27;
    and (iii) a Lender Fee of $396,000, less the $50,000 Good Faith Deposit (net
    $346,000).

[45]

Ideal submits that the motion judge erred in
    granting judgment for those amounts because none were recoverable under the
    terms of the CL in the event MZ exercised the Cancellation Provision. MZ
    submits the motion judge made no error. I will consider each item in turn.

Standby Interest

[46]

The CL stated that MZ intended to syndicate the
    Loan, which it did. Part I of the CL stipulated that if the Loan was not fully
    advanced by December 5, 2018, interest will commence on the advance date
    established herein for such advance, in the form of standby interest (Standby
    Interest) on any unadvanced portion of the Loan and will become due and
    payable on the date the Loan is advanced
or upon the
    termination of this Commitment Letter without any advances having been made
.
    [Emphasis added.]

[47]

By December 17, 2018 MZ had advised Ideal that
    it had syndicated the Loan. Over the next few weeks MZ transferred the
    syndicated funds to its counsel to be held in trust, pending closing of the
    loan transaction.

[48]

Ideal submits that the motion judge erred in
    finding that MZ was entitled to Standby Interest pursuant to the Cancellation
    Provision. Since such interest was payable only upon the termination of this
    Commitment Letter without any advances having been made, according to Ideal MZ
    was only entitled to Standby Interest if it had proceeded under the Default and
    Demand Provisions termination language.

[49]

I am not persuaded by Ideals submission. The
    practical effect of MZ proceeding under the Cancellation Provision was to
    terminate the CL without any advances having been made, the very circumstance
    contemplated by the CLs Standby Interest provision. Pursuant to that
    provision, MZ was entitled to recover from Ideal interest on the syndicated
    funds that had been put in place pending closing of the Loan. I see no error in
    the motion judge granting judgment for that amount.

Expenses and Good Faith deposit

[50]

The Expenses section in Part I of the CL stated
    that: All reasonable expenses of the Lender and the Borrower shall be paid by
    the Borrower including (but not limited to), the cost of any third-party
    reports and all legal costs
regardless of whether the
    Borrower proceeds with the transaction
 [Emphasis added.] The Good
    Faith Deposit section stated:

$50,000 non-refundable
if
    Borrower fails to proceed based on the terms of this Commitment Letter
and is full compensation to the Lender for its work and efforts in preparation
    of this Commitment Letter. The Borrower shall also be responsible for the
    Lenders legal and other, professional fees and out of pocket expenses
if the Borrower fails to proceed with the Loan
.
    [Emphasis added.]

[51]

The motion judge held that MZ was entitled to
    recover its legal fees, consultants expenses, and the Good Faith Deposit
    pursuant to the Cancellation Provision. Ideal submits that the motion judge
    erred in so holding because MZs exercise of the Cancellation Provision did not
    amount to Ideal, as borrower, failing to proceed with the transaction or Loan.

[52]

The motion judge found, at para. 53, that by
    January 22, 2019 it was apparent that Ideal would not or could not satisfy the
    pre-conditions. Ample evidence supported that finding, at least in respect of
    certain informational requirements and the terms of the subordinated financing.
    Given that conduct by Ideal, I see no error in the motion judges implicit
    conclusion that Ideal did not proceed with, or failed to proceed with, the
    transaction.

Lenders Fee

[53]

The Fees section of Part I of the CL provides
    that: $396,000, the Lender Fee, less the Good Faith Deposit
shall be deducted from the Initial Advance
. [Emphasis
    added.] Part I defines the Initial Advance, in part, as follows:

The Loan shall be advanced in one draw:

The first draw (Draw 1 or the Initial
    Advance) is anticipated to be in the principal amount of $15,200,000 and
    advanced upon satisfaction of the conditions contained herein and by the
    applicable Notices (see Appendix A, B, C and D). The Initial Advance is
    expected to be as follows:

Land Debt
    Refinancing                                $13,000,000

Lender Fee                                                  $
    396,000

[54]

The motion judge held that the claim for the
    Lender Fee was recoverable pursuant to the Cancellation Provision. In reaching
    that conclusion, he did not address Ideals submission that the Lender Fee was
    not payable without an advance of the Loan. On its part, MZ argues that the
    Lender Fee was earned upon its completion of due diligence and advance of the
    Loan to the Trust Account.

[55]

I am persuaded by Ideals submission. The
    language of the CL specifies that the Lender Fee shall be deducted from the
    Initial Advance and MZ did not make an Initial Advance to Ideal. The CL does
    not contain any other language of entitlement to the Lender Fee.

[56]

I do not accept MZs argument that the fee was
    earned upon the advance of the Loan to the Trust Account; the CL clearly
    distinguishes between the Lender Advance  the transfer of the syndicated funds
    to MZs trust account  and the Initial Advance, which is an advance to the
    Borrower.

[57]

Nor do I accept MZs submission that the
    decision in
Chijindu v. Prudential Property Management
, 2014 ONSC
    4759, applies to the facts of the present case. That case is distinguishable in
    two respects. First, the mortgage commitment letter did not contain the
    language found in the CL that the fee was to be deducted from an advance.
    Second, in
Chijindu
the mortgagee in fact had advanced the first draw
    under the mortgage commitment letter, and the issue was whether the mortgagee
    was entitled to the entire lenders administrative fee or only an amount
pro
    rated
to the amount of the actual advance. The application judge held that
    the language of the mortgage commitment letter entitled the mortgagee to the
    entire amount: at paras. 10 and 13.

[58]

Consequently, I conclude that the motion judge
    erred in granting judgment for the Lender Fee.

Conclusion

[59]

By way of summary, the fees and expenses to
    which MZ is entitled under the CL total $212,071.09 ($101,958.82 Standby
    Interest + $60,112.27 expenses + $50,000 Good Faith Deposit). MZ has already
    received the Good Faith Deposit. Therefore, the amount remaining payable by
    Ideal is $162,071.09.

IV.     DISPOSITION

[60]

For the reasons set out above, I would allow the
    appeal in part and vary para. 1 of the Judgment from $508,071.09 to
    $162,071.09.

[61]

If the parties are unable to agree upon the
    costs of this appeal, they may file brief (no more than 5 pages) cost
    submissions within 10 days of the release of these reasons.

Released: April 13, 2021 P.R.

David
    Brown J.A.

I
    agree. Paul Rouleau J.A.

I
    agree. B.W. Miller J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Marshallzehr Group Inc. v. Ideal (BC) Developments
    Inc., 2021 ONCA 299

DATE: 20210505

DOCKET: C68419

Rouleau, Brown and Miller JJ.A.

BETWEEN

Marshallzehr Group Inc.

Plaintiff/Defendant by
    Counterclaim

(Respondent)

and

Ideal
    (BC) Developments Inc., Ideal (BC2) Developments Inc., 2490568 Ontario
    Inc., 2490564 Ontario Inc. IDEAL Developments Inc., and Shajiraj Nadarajalingam

Defendants/Plaintiffs by Counterclaim

(Appellants)

Mark A. Russell, for the appellants

Stephen Schwartz, for the respondents

Heard: March 29, 2021 by video conference

On appeal from the judgment of Justice Paul M. Perell of
    the Superior Court of Justice, dated March 11, 2020, with reasons reported at
    2020 ONSC 1547, 100 B.L.R. (5th) 66.

COSTS ENDORSEMENT

[1]

The appellants, Ideal (BC) Developments Inc., Ideal (BC2) Developments
    Inc., 2490568 Ontario Inc., 2490564 Ontario Inc., Ideal Developments Inc., and
    Shajiraj Nadarajalingam (hereafter collectively Ideal), seek partial
    indemnity costs of their appeal in the amount of $12,072.87. On its part, the
    respondent, MarshallZehr Group Inc., seeks partial indemnity costs of the
    appeal of $7,735.98.

[2]

Although Ideal was not fully successful on its appeal, it did succeed in
    significantly reducing the amount of the judgment against it. In those
    circumstances, Ideal is entitled to costs of the appeal fixed in the amount of
    $10,000, inclusive of disbursements and applicable taxes. We do not interfere
    with the cost award made by the motion judge.

Paul Rouleau J.A.

David Brown J.A.

B.W. Miller J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Martin v. 11037315 Canada Inc.,
    2021 ONCA 246

DATE: 20210416

DOCKET: M52365 (C69053)

Pepall J.A. (Motion Judge)

BETWEEN

Kelly
    Martin

Applicant

(Respondent/Responding
    Party)

and

11037315 Canada Inc.
,
2670082
    Ontario Corp.
, and Autodome Ltd.

Respondents

(Appellants/
Moving
    Parties
)

Samir S. Chhina, for the moving parties

Dennis Van Sickle, for the responding party

Heard: April 13, 2021 by video conference

ENDORSEMENT

[1]

The moving parties, 11037315 Canada Inc. (110) and 2670082 Ontario
    Corp. (267), seek an order setting aside the Registrars March 29, 2021 order
    dismissing their appeal and an order extending the time to perfect the appeal.

[2]

The responding party, Ms. Martin, was served last Wednesday evening. Ms. Martins
    counsel seeks an adjournment to file materials in response. Initially, counsel
    advised that his client also wanted to bring a cross-motion for security for
    costs but ultimately indicated that he does not intend to proceed with such a
    motion at this time. Such a motion would be moot if he is successful in
    resisting the moving parties motion. Accordingly, he will limit his position
    to responding to the motion. He submits that egregious facts are missing from
    the materials before the court and the merits and overall justice of the case
    favour a dismissal of this motion.

[3]

I raised with counsel the issue of the jurisdiction of this court over
    the appeal. The parties seemed content to proceed in this court, but
    jurisdiction cannot be conferred by consent or on the basis of being unopposed.
    That said, I am satisfied that there is an arguable case to be made that this
    court has jurisdiction.

[4]

I will briefly outline the background facts related to the question of whether
    this court has jurisdiction over the proposed appeal.

[5]

The application judges endorsement dated December 23, 2020 discloses
    that Ms. Martin bought her house in 2010 for $289,000 with mortgage financing
    from TD Bank. By 2019, the property was worth $575,000 and the mortgage had
    been reduced to $160,000. She then obtained a second mortgage for $65,000 from
    2148468 Ontario Ltd. (214). 214 assigned the mortgage to 110 but Ms. Martin
    was unaware of this. 110 served her with a claim for foreclosure. She thought
    the claim was from 214 and confused the meaning of foreclosure with power of
    sale, thinking she would ultimately receive the net proceeds following the
    sale. The application judge estimated these to amount to about $350,000.
    Unbeknownst to her, 110 obtained default judgment against her and then sold the
    property to 267 for $425,000 when it was worth $575,000. 267 obtained a
    mortgage of $465,000 on the property.

[6]

Ms. Martin brought an application to set aside the default judgment
    obtained in the foreclosure action and also sought other monetary relief. The
    application judge granted Ms. Martins application. On December 23, 2020, he ordered
    that: the default judgment be set aside, the property forthwith be listed for
    sale, net proceeds over $425,000 be paid to Ms. Martin, and 110 pay her the
    proceeds it received from the sale that were in excess of the amount set forth
    in its statement of claim. He also dispensed with a formal typed order, saying
    that his endorsement was deemed to be an order in the circumstances of COVID-19.

[7]

In essence, the effect of the application judges order is that Ms.
    Martin recovers her equity in the property net of the mortgage and other obligations.
    In exercising his discretion, he relied on equity, absence of prejudice to 267,
    whom he found was not a
bona fide
purchaser for value without notice,
    and the absence of notice of assignment, which meant that the default judgment
    was irregularly obtained.

[8]

267 then moved under r. 59.06(2) of the
Rules of Civil Procedure
,
    R.R.O. 1990, Reg. 194, arguing that a new fact had been discovered: 110 had
    sent Ms. Martin notice of the assignment by registered mail. On January 29,
    2021, the motion judge dismissed the motion on the basis of lack of due
    diligence and in any event, his earlier decision was based primarily on equity
    and not on the absence of any notice of assignment. He again determined that given
    the pandemic, his endorsement was deemed to be the order without any need to
    obtain a formal, typed order.

[9]

267 is now appealing from these two orders and a costs endorsement dated
    February 23, 2012.

[10]

The
    Court of Appeals website states that:

An issued and entered order is required for
    the purpose of an appeal to the Court of Appeal for Ontario in civil
    proceedings. For information on obtaining an order from the Ontario Superior
    Court of Justice during the COVID-19 pandemic, please see section D.5 of the
    Superior Court's Consolidated Notice to the Profession, Litigants, Accused
    Person, Public and the Media.

Thus, an issued and entered order is required for the
    purpose of an appeal to the Court of Appeal for Ontario in civil proceedings. I
    would recommend that our Registry Office staff advise the moving parties that
    they should obtain and file an issued and entered order prior to the hearing of
    this motion.

[11]

The
    December 23, 2020 order has both interlocutory and final elements. An order setting
    aside a default judgment is an interlocutory order:
Laurentian Plaza Corp. v.
    Martin
(1992), 89 D.L.R. (4th) 50 (Ont. C.A.) at p. 53. As such, leave to
    appeal to the Divisional Court pursuant to s. 19(1)(b) of the
Courts of Justice
    Act
,
R.S.O. 1990, c. C.43 and
    r. 62.02(1) of the
Rules of Civil Procedure
would be required, leave
    that may not be granted by this court.

[12]

However,
    the remaining portions of the December 23, 2020 order are final in nature and
    the order finally disposed of the application.

[13]

In
Lax v. Lax
(2004), 239 D.L.R.
    (4th) 683 (Ont. C.A.), at para. 9, this court held that leave to appeal from an
    order of a judge of the Superior Court is not required where the issues in an
    appeal from an order having final and interlocutory aspects are so interrelated
    that leave would inevitably have been granted. In that case, the defendants
    moved for summary judgment seeking to dismiss the plaintiffs action as being
    statute-barred by the applicable limitation period. The motion judge determined
    that the action was not statute-barred. This determination gave rise to a final
    order on the authority of
Abbott v. Collins
, (2002), 62 O.R. (3d) 99
    (C.A.). The motion judge went on to hold that even if the limitation period
    applied, there was a discoverability issue that required a trial. As Feldman
    J.A. noted on behalf of the court, the second determination was interlocutory:

Although the second issue would, if brought as a stand-alone
    appeal to the Divisional Court, require leave of that court, because the two
    issues are so interrelated, we were able to proceed to hear the two appeals
    together in accordance with s. 6(2) of the [
CJA
], on the basis that once the first
    issue was before this court, leave would inevitably have been granted on the
    second.

[14]

This
    court proceeded to hear and determine both issues.

[15]

Lax
has since been followed in
Azzeh v. Legendre
, 2017 ONCA 385, 135
    O.R. (3d) 721, leave to appeal refused, [2017] S.C.C.A. No. 289. This court
    acknowledged that para. 1 of the formal order, which granted leave to add the
    City of Sudbury and others as defendants, was interlocutory. Paragraph 2, which
    made other amendments consistent with the addition of the defendants, was also
    interlocutory. However, para. 3, which granted a declaration that the action
    was not statute-barred, was final. While normally leave must be obtained from
    the Divisional Court before an appeal from an interlocutory order can be
    combined with an appeal from a final order, leave was not required as this case
    was similar to
Lax
. The court explained: [w]hether the City was
    properly added as a defendant depends on whether the action against it is
    statute-barred. Therefore, both aspects of the appeal were heard by this court:
    at para. 26. See also
Abbasbayli v. Fiera Foods Company
, 2021 ONCA 95,
    at para. 17;
2099082 Ontario Limited v. Varcon Construction Corporation
,
    2020 ONCA 202, 97 C.L.R. (4th) 26, at para. 17; and
Cooper v. The Laundry
    Lounge, Inc.
, 2020 ONCA 166, at para. 2.

[16]

As
    for the January 29, 2021 order, an order dismissing a motion under r. 59 to set
    aside or vary an order is interlocutory:
Antique Treasures of the World
    Inc. v. Bauer
, 2003 CanLII 35349 (Ont. C.A.). However, again, the issues
    raised by that order are closely related to those in the December 23, 2020
    order.

[17]

In
    the circumstances, given the interrelationship of the issues engaged by the two
    orders the moving parties seek to appeal, and based on the aforementioned
    authorities, I conclude that it is at the very least arguable that this court
    has jurisdiction over the appeal.

[18]

As
    such, it is appropriate for me to adjourn the motion to a new date as requested
    by the responding party. I am adjourning the motion to April 28, 2021, a date
    agreed upon by the parties, to permit the responding party to respond to the
    motion. I am satisfied that the request is legitimate given the abbreviated service
    and the absence of any materials from the responding party. The costs of today
    are reserved to the judge hearing the motion.

S.E.
    Pepall J.A.


WARNING

The President
of the panel hearing this appeal directs that the following should be attached
to the file:

An order
restricting publication in this proceeding under ss. 486.4(1), (2), (2.1),
(2.2), (3) or (4) or 486.6(1) or (2) of the
Criminal Code
shall
continue.  These sections of
the Criminal Code
provide:

486.4(1)         Subject to
subsection (2), the presiding judge or justice may make an order directing that
any information that could identify the victim or a witness shall not be
published in any document or broadcast or transmitted in any way, in
proceedings in respect of

(a)     any
of the following offences;

(i)      an offence
under section 151, 152, 153, 153.1, 155, 159, 160, 162, 163.1, 170, 171, 171.1,
172, 172.1, 172.2, 173, 210, 211, 213, 271, 272, 273, 279.01, 279.011, 279.02,
279.03, 280, 281, 286.1, 286.2, 286.3, 346 or 347, or

(ii)      any offence
under this Act, as it read at any time before the day on which this
subparagraph comes into force, if the conduct alleged involves a violation of
the complainants sexual integrity and that conduct would be an offence
referred to in subparagraph (i) if it occurred on or after that day; or

(iii)     REPEALED:
S.C. 2014, c. 25, s. 22(2), effective December 6, 2014 (Act, s. 49).

(b)     two or more
offences being dealt with in the same proceeding, at least one of which is an
offence referred to in paragraph (a).

(2) In proceedings in respect of the
offences referred to in paragraph (1)(a) or (b), the presiding judge or justice
shall

(a)     at
the first reasonable opportunity, inform any witness under the age of eighteen
years and the victim of the right to make an application for the order; and

(b)     on
application made by the victim, the prosecutor or any such witness, make the
order.

(2.1) Subject to subsection (2.2),
in proceedings in respect of an offence other than an offence referred to in
subsection (1), if the victim is under the age of 18 years, the presiding judge
or justice may make an order directing that any information that could identify
the victim shall not be published in any document or broadcast or transmitted
in any way.

(2.2) In proceedings in respect of
an offence other than an offence referred to in subsection (1), if the victim
is under the age of 18 years, the presiding judge or justice shall

(a)
as soon as feasible, inform the victim of their right to make an application
for the order; and

(b)
on application of the victim or the prosecutor, make the order.

(3)   In proceedings in respect of
an offence under section 163.1, a judge or justice shall make an order
directing that any information that could identify a witness who is under the
age of eighteen years, or any person who is the subject of a representation,
written material or a recording that constitutes child pornography within the
meaning of that section, shall not be published in any document or broadcast or
transmitted in any way.

(4)   An order made under this
section does not apply in respect of the disclosure of information in the
course of the administration of justice when it is not the purpose of the
disclosure to make the information known in the community.
2005, c. 32, s. 15; 2005, c. 43, s.
8(3)(b); 2010, c. 3, s. 5; 2012, c. 1, s. 29; 2014, c. 25, ss. 22,48; 2015,
c.  13, s. 18.

486.6(1)         Every person who
fails to comply with an order made under subsection 486.4(1), (2) or (3) or
486.5(1) or (2) is guilty of an offence punishable on summary conviction.

(2)   For greater certainty, an
order referred to in subsection (1) applies to prohibit, in relation to
proceedings taken against any person who fails to comply with the order, the
publication in any document or the broadcasting or transmission in any way of
information that could identify a victim, witness or justice system participant
whose identity is protected by the order. 2005, c. 32, s. 15.

COURT OF APPEAL FOR ONTARIO

CITATION: R. v. Tootiak, 2021 ONCA 356

DATE: 20210527

DOCKET: C65194

Watt, Benotto and Harvison Young
JJ.A.

BETWEEN

Her Majesty the Queen

Respondent

and

Jayson Tootiak

Appellant

Ian B. Kasper, for the appellant

Alexander Hrybinsky, for the respondent

Heard: May 19, 2021 by video
conference

On appeal from the from the conviction
entered on February 26, 2013 and the sentence imposed on December 1, 2015 by
Justice Jack Nadelle of the Ontario Court of Justice.

REASONS FOR DECISION

[1]

The appellant was convicted of a sexual assault
and assault causing bodily harm. He was sentenced to 13 years less two years
pre-sentence custody on the sexual assault and 10 years concurrent on the
assault causing bodily harm. He appeals his conviction and sentence.

[2]

The appellant formally agreed at trial that the
sex act with the complainant took place. He did not testify.

[3]

He appeals the trial judges finding on
credibility of the complainant. He submits that the judge erred by: (i)
bolstering her credibility because she acknowledged her criminal record; (ii)
relying on evidence to support her credibility that was neither independent nor
material; and (iii) finding that she had an excellent recollection of events.

[4]

We accept none of these grounds.

[5]

A trial judge
s finding of credibility is owed a
high degree of deference on appeal. Read as a whole, the trial judges reasons
show he found the complainant to be credible and reliable. He made none of the
three errors alleged. In particular:

1.

The trial judge cautioned himself on the complainants criminal record.
In this context he commented that she readily admitted it. His comment was
responsive to the defence focus on her record during cross-examination. It did
not amount to impermissible bolstering.

2.

There was independent evidence confirming the complainants evidence:
the bus driver and the police officer testified about injuries to her face and
head. The nurse testified about injuries to her buttocks. This evidence was
independent and material.

3.

The trial judge was not required to address every inconsistency in the
complainants evidence. He found her recollection of events to be excellent.
Clearly, he was not referring to individual details such as how many drinks she
had consumed or how certain abrasions happened but rather her recollection of
being violently assaulted and raped.

[6]

We see no error in the trial judges conclusions.

[7]

The appellant was sentenced to 13 years less two years for pre-sentence
custody for the sexual assault. It is acknowledged by the Crown that this
exceeds the maximum sentence of 10 years and is thus an error.

[8]

The conviction appeal is dismissed. The sentence appeal is allowed. The
net sentence is therefore varied to six years, 10 months and two days.

David Watt J.A.

M.L. Benotto J.A.

A. Harvison Young
J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: McMurter v. McMurter, 2021 ONCA 5

DATE: 20210105

DOCKET: C66465

Feldman,
    Simmons and Harvison Young JJ.A.

BETWEEN

Kelly
    Ann McMurter

Applicant
    (Respondent)

and

James
    Robert Gordon McMurter

Respondent
    (Appellant)

Kelly Ann McMurter, acting in person

Andrew Rogerson, for the appellant

Heard: in writing

On
    appeal from the order of Justice Helen MacLeod-Beliveau of the Superior Court
    of Justice, dated December 28, 2018, with reasons reported at 2018 ONSC 7604.

COSTS
    ENDORSEMENT

[1]

Costs of the appeal are to the respondent on a
    partial indemnity scale in the amount of $2,500, inclusive of disbursements and
    HST.

K.
    Feldman J.A.

Janet
    Simmons J.A.

A.
    Harvison Young J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Medcof (Re), 2021 ONCA 168

DATE: 20210319

DOCKET: C68714

Watt, Benotto and Jamal JJ.A.

IN THE MATTER OF:  William Medcof

AN APPEAL UNDER PART XX.1 OF THE
CODE

Ken J. Berger
,
    for the appellant

Erica Whitford
, for the respondent,
    Attorney General of Ontario

Leisha Senko, for the respondent,
Person in Charge of the Centre for Addiction and Mental Health

Heard: March 4, 2021 by video
    conference

On appeal from the disposition of the
    Ontario Review Board dated, July 8, 2020, with reasons dated September 16, 2020.

REASONS FOR DECISION

Background

[1]

The appellant has been under the jurisdiction of the ORB since
    2002. In 2001, he attacked his roommate, kidnapped his mother, and threatened
    and assaulted his father. On November 29, 2002 he was found not criminally
    responsible on account of mental disorder. Thereafter, the appellant generally
resided in minimum and medium secure units of mental health
    facilities.

[2]

The appellant has been diagnosed with schizophrenia, substance use
    disorder, personality disorder, and exhibitionistic paraphilic disorder. He was
    found treatment incapable in 2006 and the Public Guardian and Trustee is his
    substitute decision-maker. In 2012 he was discharged to reside in the community
    in supportive housing. Since that time, he has been living in housing run by
    Ecuhome. He has his own room and shares a kitchen, bathroom and common areas.
    He has not been involved in violent or criminal behaviour. He was granted a
    conditional discharge in 2017, which was continued in 2018 and 2019.

The Current Disposition

[3]

The appellant had a positive year following the 2019 disposition.
    However, he also began testing positive for cocaine in 2019. This, together
    with his regular use of marijuana, became a concern of his treatment team
    headed by Dr. Pearce. While there were no incidents of violence, on March 4,
    2020 he threatened Dr. Pearce and his staff. His family expressed concern with
    respect to potential violence.

[4]

The appellant contends that the medical treatment does nothing for him
    and he wants to go on a medication holiday to prove that he does not need to
    be medicated. He said he will stop his medication if he receives an absolute
    discharge. In Dr. Pearces opinion, the medication holiday would need to be
    carefully monitored and he would need to abstain from drug use for at least a
    month before conducting the medication holiday. If the appellant does not agree
    to abstain, then there is a significant risk of decompensation and relapse to
    violent behaviour.

[5]

The Board determined that, based on these facts, he remained a
    significant threat to the safety of the public and his conditional discharge
    should be continued.

Issues on Appeal

[6]

The appellant seeks an absolute discharge. He raises two arguments:

1.

He submits that
    Dr. Pearces conclusion that he would stop treatment and decompensate if given
    an absolute discharge was not supported by the evidence.

2.

The Boards
    reasons were insufficient to support the conclusion that the appellant is a
    significant risk to public safety.

Discussion

[7]

The appellant says that the Boards findings that he remains a
    significant threat to the safety of the public defies logic and amounts to a
    life sentence for something that happened decades ago. In particular, he
    points to the fact that there have been no incidents of violence and he has not
    been hospitalized for five years. There was no evidence, he submits, that he
    would decompensate and become a risk.

[8]

Dr. Pearces conclusions were based on the fact that the appellant
    suffers from a major mental illness for which he continues to exhibit symptoms.
    He has a lack of insight to the illness and the corresponding risks. As set out
    in the hospital report, the appellant intends to stop all medication, and this
    creates a serious risk that he will decompensate. The appellant is not willing
    to abstain from drug use, which he claims is irrelevant. In fact, a combination
    of non-compliance with medication and substance abuse would lead to a return to
    psychotic symptoms, which led to the index offences.

[9]

In our view, the Boards conclusion that the appellant poses a
    significant threat is reasonable based on the evidence at the hearing.

[10]

We
    do not agree that the reasons of the Board were insufficient. They clearly
    indicate the reasons for the disposition. The Board referred to the appellants
    progress, lack of violent acts and need to abstain from drugs, particularly
    cocaine, for at least one month. However, the appellant did not demonstrate
    that he is prepared to remain abstinent.

[11]

The
    Board concluded:

It is clear from the evidence in the Hospital Report and the
viva voce
evidence of Dr. Pearce that there is a
    substantial risk of his continuing to use marijuana and cocaine which will
    produce a psychotic reaction and trigger his tendency to do violence.

[12]

We
    conclude that the disposition of the Board is reasonable.

[13]

For
    these reasons, the appeal is dismissed.

David Watt J.A.

M.L. Benotto J.A.

M. Jamal J.A.


COURT OF APPEAL
    FOR ONTARIO

CITATION: Mikelsteins v. Morrison Hershfield Limited, 2021
    ONCA 155

DATE: 20210312

DOCKET: C66315

Fairburn A.C.J.O., Lauwers and Nordheimer JJ.A.

BETWEEN

Ivars Mikelsteins

Plaintiff (Respondent)

and

M
orrison Hershfield Limited

Defendant (Appellant)

David E. Greenwood and Christopher McClelland, for the
    appellant

James D. Heeney and Julia Burke, for the respondent

Heard: in writing

On remand from the order of the Supreme Court of Canada, dated
    November 19, 2020.

REASONS FOR DECISION

[1]

On June 20, 2019, we released our decision allowing the appeal from the
    judgment of the Superior Court of Justice dated November 22, 2018 in this
    matter.
[1]
On November 19, 2020, the Supreme Court of Canada, in response to a motion for
    leave to appeal by the respondent, rendered judgment remanding this matter to
    this court pursuant to s. 43(1.1) of the
Supreme Court Act
, R.S.C.
    1985, c. S-26 for disposition in accordance with its decision in

Matthews
    v. Ocean Nutrition Canada Ltd.
,
2020 SCC 26, 449 D.L.R. (4th) 583.

[2]

After the remand was made, this court requested and received written submissions
    from the parties.

The principal issue

[3]

The background to this matter is set out in detail in our reasons on the
    appeal. It is unnecessary to repeat all of that detail. In brief, the
    respondent commenced an action for wrongful dismissal. He then brought a motion
    for summary judgment. The motion judge awarded the respondent damages for
    wrongful dismissal. That award was not appealed. The motion judge also determined
    that the respondent was entitled to an additional payment for the shares that
    he held in the appellants parent corporation, Morrison Hershfield Group Inc., and
    a further entitlement to a share bonus. Those awards were the subject of the
    appeal.

[4]

The respondent was one of a select group of the appellants employees who
    were eligible to purchase shares of Morrison Hershfield Group Inc. Those shares
    were governed by the terms and conditions of the Amended and Restated Morrison
    Hershfield Group Inc. Shareholders Agreement, dated January 18, 2013 (the
    Shareholders Agreement). At the time that his employment was terminated, the
    respondent owned a total of 5,108 shares.

[5]

Under the terms of the Shareholders Agreement, the respondent, and
    other shareholders, were eligible to receive annual Share Bonuses. The share
    bonus payable in respect of each share is determined by an objective calculation
    based on the companys financial results. The total share bonus payable to each
    shareholder depends on the total number of shares that the shareholder had
    previously decided to purchase. As we said in our earlier reasons, the share
    bonus is not related to the shareholders contributions as an employee of the
    appellant. It is, in effect, a dividend.

[6]

With respect to the respondents shareholdings, the motion judge
    determined that the respondent was entitled to: (i) hold the shares until the
    end of the reasonable notice period (i.e. 26 months after he was notified of
    his termination and his association with the appellant had ceased); and (ii)
    receive damages for the loss of the share bonus that would have been payable
    during such 26-month period.

[7]

Article 3 of the Shareholders Agreement deals with Automatic Transfer
    Notices, and applies in situations where, among other things, a shareholder
    resigns, is terminated, becomes bankrupt, or dies. Article 3.2 applies in cases
    of termination, and states:

A Shareholder whose association with the Corporation and its
    Affiliates ceases by reason of termination by the Corporation of his/her
    employment with the Corporation and its Affiliates shall, immediately after
    such termination, be deemed to have given a Transfer Notice covering all of the
    Shares held by him/her on a date which is 30 days from the date he/she is
    notified of such termination by the Corporation.

The Shareholders Agreement proceeds to specify that a
    shareholder that is deemed to have given a Transfer Notice under Article 3 is
    entitled to the Fair Value of his or her shares (as that term is defined in
    the Shareholders Agreement).

[8]

Contrary to the motion judges conclusions, we determined that the
    respondent was not entitled to have his shares valued as at the end of the
    notice period nor was he entitled to the share bonuses during that time.

[9]

The question that is now before us is whether the decision of the
    Supreme Court of Canada in
Ocean Nutrition
would direct that different
    conclusions ought to have been reached on those two issues. We conclude that it
    would not.

[10]

In
Ocean Nutrition
, at para. 55, Kasirer J. concluded that, in assessing
    an employees damages arising from a wrongful dismissal, a court should ask
    itself two questions:

(i) Would the employee have been entitled to the bonus or
    benefit as part of their compensation during the reasonable notice period?

(ii) If so, do the terms of the employment contract or bonus
    plan unambiguously take away or limit that common law right?

[11]

One
    very important factual point underpins these two questions. They are both
    directed at determining the rights of the employee
qua
employee. That
    is, they are both directed at determining the damages that an employee is
    entitled to arising from a breach of the contract of employment.

[12]

In
    this case, the respondents claim to the dividend does not arise from the
    breach of his contract of employment. Rather, we were determining the
    respondents rights as a shareholder of Morrison Hershfield Group Inc. pursuant
    to the Shareholders Agreement. In that regard, it is of importance to remember
    that the respondent did not receive his shares in Morrison Hershfield Group
    Inc. as some form of compensation as an employee of the appellant. To the
    contrary, the respondent was given the opportunity to use his own funds to
    purchase shares in Morrison Hershfield Group Inc. When he elected to do so, the
    respondents rights regarding his shares were dictated by the terms of the
    Shareholders Agreement.

[13]

The
    decision in
Ocean Nutrition
does not change the proper analysis to be
    applied to the issues raised on the appeal in this case. The respondents
    entitlement respecting his shares falls to be determined by his rights as a
    shareholder of Morrison Hershfield Group Inc., not by his status as a
    terminated employee of the appellant. To conclude otherwise would run the risk
    of interfering with the established law on the rights and obligations of
    shareholders, much of which is codified in corporate statutes such as the
Business
    Corporations Act
, R.S.O. 1990, c. B.16 and the
Canada Business
    Corporations Act
, R.S.C. 1985, c. C-44.

[14]

Just
    by way of example, s. 32 of the
Business Corporations Act
provides
    that a corporation may purchase or redeem any redeemable shares issued by it,
    which, in one sense, is what happened in this case. As we observed in our decision,
    there are very good reasons why an employee-owned corporation would not wish an
    employee to be able to exercise all of the rights of a shareholder once their
    employment is terminated.

[15]

We
    would add that the treatment of the payment of the amounts under the
Income
    Tax Act
, R.S.C. 1985, c. 1 (5th Supp.), does not change the law applicable
    to the rights being determined under the Shareholders Agreement.

Other issues raised

[16]

The
    respondent raises certain other issues, including the possible application of
    the

Employment Standards Act
, 2000
, S.O. 2000, c. 41. With
    respect, the remand of this matter does not invite a wholesale reopening of the
    appeal and all matters relating to it:
Deslaurier Custom Cabinets Inc. v.
    1728106 Ontario Inc.
,
2017 ONCA 293, 135 O.R. (3d) 241, at para. 14,
    leave to appeal refused, [2016] S.C.C.A. No. 249. Rather, the remand is
    restricted to its terms, which was for disposition in accordance with

David
    Matthews v. Ocean Nutrition Canada Ltd.
,
2020 SCC 26.

[17]

None
    of the other issues raised by the respondent arise from the decision of
Ocean
    Nutrition
. Indeed, the Supreme Court of Canada expressly declined to deal
    with the application of minimum employment standards in its decision.
    Consequently, those issues are not open for re-argument.

[18]

Finally,
    the respondent sought a further oral hearing in this matter. The appellant said
    that no further oral argument was required. We agree with the appellant. The
    issue to be determined can be properly resolved through the written submissions
    of the parties.

C
onclusion

[19]

For
    these reasons, having reconsidered our decision in light of
Ocean

Nutrition
,
    we affirm our earlier appeal decision. The appellant is entitled to its costs
    of the remand proceeding fixed in the amount of $10,000, inclusive of
    disbursements and HST.

Fairburn A.C.J.O.

P. Lauwers J.A.

I.V.B. Nordheimer
    J.A.

[1]

Mikelsteins v. Morrison Hershfield Limited
,
    2019 ONCA 515, 56 C.C.E.L. (4th) 1.


COURT OF APPEAL FOR ONTARIO

CITATION: Moar v. McLaughlin, 2021 ONCA 264

DATE: 20210423

DOCKET: C68833

Benotto, Miller and Trotter JJ.A.

BETWEEN

Brianne
    Harrison Moar

Appellant

and

Daniel John McLaughlin

Respondent

Maybelline R. Massey, for the appellant

Danica Maslov, for the respondent

Heard and released orally: April 22, 2021 by
    video conference

On
    appeal from the order of Justice J.R. Henderson of the Superior Court of
    Justice, dated October 9, 2020.

REASONS FOR DECISION

[1]

The appellant submits that the motion judge
    erred in concluding that a material change in circumstances existed for the
    purposes of a motion to change under Rule 15 of the
Family Law Rules
.

[2]

The parties agreed that, pursuant to r. 16, the
    issue of whether a material change existed would be determined on a summary
    judgment motion. The motion judge concluded that there was a material change of
    circumstances.

[3]

The appellant submits that the motion judge
    should not have made the order because there was a genuine issue for trial.

[4]

We do not agree. The parties agreed at a case
    conference before Broad J. that the issue of whether there was a material
    change of circumstances be determined in advance of the motion change by way of
    summary judgment.

[5]

The appellant further submits that the motion
    judge erred in his application of the test for material change set out in
Gordon
    and Goertz
[1996] 2 S.C.R. 27.

[6]

Again, we disagree.

[7]

The respondent has moved, has a new partner and a
    change in his work schedule. These factors clearly fall within the
Gordon
    and Goertz
analysis. They are relevant to the best interest of the
    children, a matter within the discretion of the motion judge.

[8]

The appeal is dismissed with costs in the agreed
    upon amount of $3,500 all inclusive.

M.L.
    Benotto J.A.

B.W.
    Miller J.A.

Gary
    Trotter J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Mohamoud v.
    Carleton Condominium Corporation No. 25, 2021 ONCA 191

DATE: 20210329

DOCKET: C67919

Tulloch, Miller and
    Thorburn JJ.A.

BETWEEN

Sadiya Ali Mohamoud

Applicant (Appellant)

and

Carleton Condominium
    Corporation No. 25

Respondent (Respondent)

Gary G. Boyd and Hilary Chung, for the appellant

Melinda Andrews, for the respondent

Heard: November 17, 2020 by video conference

On appeal from the judgment of
    Justice Heather J. Williams of the Superior Court of Justice dated December 9,
    2019, with reasons reported at 2019 ONSC 7127.

REASONS FOR DECISION

[1]

T
he appellant appeals the order of the application
    judge dated December 9, 2019, which dismissed her application under
    the
Condominium Act
, 1998, S.O.
    1998, c. 19 (the Act).

[2]

The appellant has owned
    a unit in the respondents condominium since 2009. The appellant brought an
    application against the respondent alleging that: (1) the corporation failed to
    properly maintain and repair the common elements of the condominium building
    under ss. 89 and 90 of the Act, and (2) it acted in a manner that was
    oppressive or unfairly prejudicial, or that unfairly disregarded her interests,
    under s. 135 of the Act.

[3]

The application
    involved a noise complaint relating to fans located on the roof directly above
    the appellants condominium unit. The appellant informed the respondent that
    the noise was causing her discomfort in 2014. In 2019, the respondent removed
    two fans above the appellants unit. According to the appellant, the removal of
    these two fans reduced the noise to a tolerable level. The appellant alleged
    that the respondent did not take her complaints seriously, and did not rectify
    the problem in a timely manner.

[4]

The appellant asks this
    court to set aside the order of the application judge, raising two grounds of appeal:

1.

the application judge erred in using the legal
    test of reasonableness when determining whether the respondent corporation
    acted oppressively within the meaning of s. 135 of the
Act
; and

2.

the application judge erred by only considering
    the applicants reasonable expectation that the respondent would comply with
    its maintenance and repair obligations, without also considering her other
    reasonable expectations, including that: the respondent would address her
    concerns in a timely manner; she could have quiet enjoyment of her unit; the
    respondent would act in accordance with the professional advice it received;
    and the respondent would take her concerns seriously.

[5]

For the following
    reasons, we dismiss the appeal.

A.

The test under s.
    135(2) of the act

[6]

The judge dismissed the
    application, finding that the respondent met its obligations under the Act. In
    particular, she found that the respondent acted reasonably and appropriately when
    responding to the appellants noise complaint.

[7]

The appellant agrees
    that the application judge properly applied the test of reasonableness when she
    assessed whether the respondent breached its obligation to maintain and repair
    the common elements of the condominium under ss. 89 and 90 of the Act.

However, she submits that the application judge erred in applying the
    same test of reasonableness when determining whether the respondents conduct
    was oppressive within the meaning of s. 135 of the
Act
. Put
    another way, the appellant contends that the application judge conflated the test
    of oppression under s. 135 of the
Act
with the test of reasonableness under ss.
    89 and 90
.

[8]

Under s. 135(2) of the Act,
    the court must determine whether the impugned conduct is, or threatens to be,
    oppressive or unfairly prejudicial to the applicant or unfairly disregards their
    interests. The test under s. 135(2) has two prongs. First, the court must
    assess whether there has been a breach to the claimants reasonable
    expectations. If the answer is yes, the court must then go on to consider
    whether the conduct complained of amounts to oppression, unfair prejudice, or unfair
    disregard of the relevant interest:
Metropolitan
    Toronto Condominium Corporation No. 1272 v. Beach Development (Phase II)
    Corporation
, 2011 ONCA 667, 285
    O.A.C. 372, at paras. 5-6;
3716724 Canada Inc. v. Carleton Condominium
    Corporation No. 375
, 2016 ONCA 650, 61 B.L.R. (5th) 173, at
para. 29
.

[9]

Reading the application
    judges reasons in their totality, it is clear that she understood and applied
    the correct test under s. 135(2) of the Act. The application judge correctly
    sets out the test at para. 36 of her reasons:

A unit owner seeking an oppression remedy under the
Condominium
    Act
must show both that there was a breach of their reasonable
    expectations and that those reasonable expectations were breached by conduct
    legitimately characterized as oppressive. (
Weir
, supra, at paras.
    10-11.)

[10]

The application judge also grasped
    the nature of the appellants claim in relation to s. 135(2): namely, that the
    respondent allegedly ignored her, disbelieved her complaints about the noise
    and deliberately dragged its heals when responding to her complaints.

[11]

After thoroughly engaging with
    these concerns, the application judge made the following finding:

I find that Ms. Mohamoud had a reasonable expectation that
    CCC25 would comply with its statutory obligations to repair and maintain its
    common elements. I also find that CCC25 acted reasonably and in compliance with
    these obligations.

Stated otherwise, the application
    judge found that the appellant failed to satisfy the first prong of the test: the
    respondent did not act in a manner that breached the appellants reasonable
    expectations because it acted reasonably and complied with its statutory
    obligations.

[12]

Moreover, based on the factual
    matrix before her, the
application judge was entitled to find that the respondents conduct did not
    amount to oppression, unfair prejudice, or unfair disregard of the appellants
    interests on the basis that the respondent acted reasonably. In our view, the
    evidence, as set out by the application judge, was consistent with the finding
    that the respondent did not act in a manner that was oppressive or unfairly
    prejudicial to the appellant, or that it unfairly disregarded her interests. In
    coming to that determination, the application judge noted that:

1. There was evidence that the fans were
    inspected and maintained on a regular basis by a company retained by the
    respondent;

2. After the appellant brought her concerns to
    the respondents attention, the fans were inspected specifically with a view to
    identifying the source of the noise;

3. In August 2014, the respondent retained a
    company that inspected the roof of the building and found nothing that was
    rattling;

4. In January 2015, the same company inspected
    and serviced the fans, and was unable to identify any problems;

5. In the spring of 2015, the appellant
    retained a consultant who concluded that none of the noise levels in the
    appellants unit exceeded industry guidelines. Highway traffic and a
    refrigerator were the sources of the loudest noises in the appellants unit;

6. In June 2016, the company retained by the
    respondent inspected the fans and exchanged some of the blower assemblies. The
    company placed quieter blowers in the fans above the appellant's unit;

7. In February 2017, the company conducted an
    "on/off' test to ascertain which fans caused the noise. The appellant
    reported that turning off fans other than those over her own unit eliminated
    the noise problem entirely. The company removed those fans;

8. In September 2018, mechanical engineers inspected
    the two fans over the appellants unit and concluded that neither fan was
    particularly noisy.  One of the fans was quiet according to industry standards,
    while the other had only a slight bearing noise;

9. The fans over the appellants unit were
    serviced on October 5, 2018;

10. When the respondent sought to change the
    fans over the appellants unit, the appellants consultant objected to the
    installation instructions of the fans' manufacturer, resulting in further
    delay;

11. The new fans were installed on July 16,
    2019, in accordance with the manufacturer's original instructions, even though
    the respondents expert was of the opinion that these fans were not the cause
    of the noise in the appellant's unit; and

12.  After the fans over the appellants unit
    were replaced, the appellant initially said that the noise and vibration
    persisted, however her own expert did some testing and reported that the noise
    in her unit was at acceptable levels.

[13]

As a result, the application
    judge was satisfied that the respondent had addressed the appellant's complaint
    in a reasonable manner by meeting with her, communicating with her orally and
    in writing, visiting her unit on multiple occasions, retaining contractors and
    experts to investigate, and in following the recommendations of the experts.
    The application judges finding that the respondents conduct did not amount to
    oppression, unfair prejudice, or unfair disregard is entitled to deference on
    appeal.

[14]

We find no error in the
    decision of the application judge.

[15]

This ground of appeal
    is dismissed.

B.

The applicants other
    reasonable expectations

[16]

Again, the appellant
    submits that the application judge erred by failing to consider her reasonable
    expectations that: the respondent would address her concerns in a timely
    manner; she could have quiet enjoyment of her unit; the respondent would act in
    accordance with the professional advice it received; and the respondent would
    take her concerns seriously.

[17]

The appellants
    argument is not borne out in the facts, as found by the application judge, and
    as reiterated above, in para. 12. The respondent tried to address the
    appellants concerns in a timely manner. It also tried to ensure that she had
    quiet enjoyment of her unit. The respondent took action even when it was
    contrary to the professional advice that it had received. The application judge
    specifically found that the respondent took the appellants concerns seriously,
    and that the respondent spent considerable amounts of money trying to address
    them.

[18]

We find no error in the
    decision of the application judge. It appears the appellant is simply
    attempting to re-litigate the factual determinations made by the application
    judge.

[19]

We give no effect to
    this ground of appeal.

C.

Conclusion and
    Disposition

[20]

The appeal is
    dismissed. As noted in the hearing, costs are awarded to the respondent in the
    amount of $12,000, inclusive of
disbursements and HST
.

M.
    Tulloch J.A.

B.W.
    Miller J.A.

J.A.
    Thorburn J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Motuz (Re), 2021 ONCA 247

DATE: 20210420

DOCKET: C68632

Fairburn A.C.J.O., Doherty and
    Sossin JJ.A.

IN THE MATTER OF: Gary Robert Motuz

AN APPEAL UNDER PART XX.1 OF THE
CODE

Dean Embry, for the appellant, Gary
    Robert Motuz

Gerald Brienza, for the respondent,
    Attorney General of Ontario

Julia Lefebvre, for the respondent, Person
    in Charge of Waypoint Centre for Mental Health Care

Heard and released orally:
    April 16, 2021 by video conference

On appeal from the disposition of the
    Ontario Review Board, dated July 13, 2020, with reasons dated August 12, 2020.

REASONS FOR DECISION

[1]

This is an appeal from the July 13, 2020
    disposition of the Ontario Review Board (Board), imposing a detention
    order.

[2]

On February 24, 2021, the Board convened the
    appellants annual hearing pursuant to s. 672.81(1) of the
Criminal Code
,
    R.S.C. 1985, c. C-46,

resulting in another detention order. The
    reasons for the most recent detention order were released on March 18, 2021.
    Those reasons are largely the same as the reasons released on August 12, 2020.

[3]

As the July 13, 2020 disposition is no longer in
    effect, the parties were asked to provide written submissions on the question
    of mootness ahead of todays hearing. They were also permitted to make oral
    submissions on the question of mootness this morning.

[4]

All parties agree that the matter is moot.

[5]

The appellant argues, though, that because the
    reasons for the current disposition are largely the same as the reasons for the
    now moot disposition, the March 18, 2021 reasons should simply be incorporated
    into the present appeal without the need for new or additional arguments.

[6]

In oral submissions today, the Crown has taken
    the position that the matter is moot and should not be heard by this court
    without the benefit of a full record.

[7]

The Person in Charge of Waypoint Centre for
    Mental Health Care agrees with the Crown that this court should not exercise
    its discretion to hear the appeal today.

[8]

We agree that this appeal is moot, and we find
    that it should not be heard today.

[9]

The appellants request is to attempt to turn an
    appeal from the old disposition into an appeal from the new disposition. To be
    clear, the new disposition has not been appealed from and there is no record
    before this court as it relates to the new disposition. On their face alone,
    the reasons for the new disposition demonstrate that things have changed to
    some extent between the two dispositions. Counsel are in agreement that, among
    other things, there has been a fairly recent decompensation over the winter.
    Not only are we without a transcript of the evidence upon which the
    February 24, 2021 disposition rests, but we are also without the most recent
    hospital report setting out the appellants progress and status between the July
    13, 2020 disposition and the February 24, 2021 disposition.

[10]

We decline to determine the merits of an appeal
    without an appropriate record, particularly an appeal that rests on the
    question of the reasonableness of the Boards disposition.

[11]

The appeal from the 2020 order is therefore dismissed
    as moot.

[12]

If the appellant commences an appeal from the
    February 24, 2021 disposition, this court will endeavour to find as early a date
    as possible in the circumstances for the hearing of the appeal.

Fairburn
    A.C.J.O.

Doherty
    J.A.

L.
    Sossin J.A.