COURT OF APPEAL FOR ONTARIO

CITATION: Correct Building Corporation v. Lehman, 2018 ONCA
    462

DATE: 20180517

DOCKET: C64137

Pepall, Trotter and Paciocco JJ.A.

BETWEEN

Correct Building Corporation and
Correct Group Inc.

Plaintiffs

(
Appellants/Respondents by way of
    cross-appeal
)

and

Jeffrey Lehman, Jon Babulic, Richard Forward,
    Janet Foster, Charles Magwood, Edward Archer, Ingrid Peters, Deborah McKinnon,
    Jennifer Robinson, Metrolinx,
Robert Stewart, Indicom
    Appraisal Associates Ltd.
, Alex Nuttal, Jerry Moore, Michael Prowse and
    The Corporation of the City of Barrie

Defendants

(
Respondents/Appellants by way of
    cross-appeal
)

Roman Krupnyk, for the appellants/respondents by way of
    cross-appeal

Roger J. Horst and Rafal Szymanski, for the respondents/appellants
    by way of cross-appeal Robert Stewart and Indicom Appraisal Associates Ltd.

Albert Formosa and Faren Bogach, for Jeffrey Lehman, Jon
    Babulic, Richard Forward, Janet Foster, Charles Magwood, Edward Archer, Deborah
    McKinnon, Jennifer Robinson, Alex Nuttal, Jerry Moore, and Michael Prowse

Heard: April 30, 2018

On appeal from the order of Justice Michael G. Emery of
    the Superior Court of Justice, dated June 23, 2017.

REASONS FOR DECISION

[1]

The appellant developer, Correct Group Inc.
    (CGI), appeals
[1]
from a summary judgment (i) dismissing its claims for conspiracy and negligent
    and fraudulent misrepresentation against the respondent appraisers, Robert
    Stewart and his company, Indicom Appraisal Associates Inc. (collectively, the
    respondents); and (ii) ordering a mini-trial on its claims of negligence,
    inducing breach of contract, and intentional interference with economic
    relations. The respondents seek leave to appeal the order for a mini-trial.

[2]

In May 2009, the City of Barrie, the appellant,
    and the YMCA executed a document entitled Preliminary Agreement that
    addressed the development of property related to an old Allandale train
    station.  This document provided that the finalization of an agreement of
    purchase and sale would be on terms to be negotiated.  On September 17, 2009,
    the City requested a quotation from Indicom for an appraisal to assist the City
    in negotiations for the potential sale of the Allandale property.

[3]

In January 2010, the YMCA withdrew from the
    development.  The appellant modified its proposal such that the acreage of the site
    for development would be reduced.

[4]

As a result of the changed proposal, the Citys
    appraisal requirements changed.  It asked the respondents to prepare an
    appraisal analysis based on assumptions related to the appellants proposal.  The
    respondents provided the appraisal to the City on August 20, 2010.  The
    appraisal warned that a change in assumptions might change the stated value.
    The appraisal also contained limitations on use and certain limiting
    conditions.  The respondents noted that no environmental factors affecting the
    property had been considered.  The respondents cautioned that if placing
    reliance on the report, an expert qualified in environmental issues should be
    retained.  In addition, the respondents noted in the report that an
    archeological survey had not been completed.

[5]

The appraisal was for a value that was higher
    than the amount the appellant wished to offer, and the appellant took the
    position that the property was overvalued.  Without the respondents knowledge
    or permission, the City discussed the appraisal with CGI.  The City also gave a
    copy of the appraisal to William Moore who, based on the appellants amended statement
    of claim, was the appellants financial consultant.

[6]

On August 26, 2010, the principal of the appellant
    wrote to the City complaining about the appraisal.  He admitted that by that
    date he was concerned about the accuracy of the appraisal and knew it contained
    a major flaw.  Some months later, on November 12, 2010, Moore communicated CGIs
    offer to purchase the property for an amount less than the appraisal amount.  The
    City rejected the offer.

[7]

The appellant then sued the City, members of
    City Council, the respondents, and others on December 16, 2013.  The appellant took
    the position before this court that it continued pointless negotiations with
    the City in reliance on an appraisal, which was based on assumptions that
    misrepresented the value of the property because it failed to consider
    environmental, archeological, and planning issues.  They assert that the
    respondents knew or should have known important factors when completing the
    appraisal, such as, that the property was potentially environmentally
    contaminated and also was located on a First Nations burial site.  The
    appellant also brought separate proceedings in Orangeville against the City.  In
    the Orangeville proceedings, Healey J. concluded that there was no agreement on
    essential terms between the City and the appellant after the signing of the
    Preliminary Agreement. The appeal of her order by the appellant was
    unsuccessful.

[8]

The respondents brought a motion for summary
    judgment asking that the appellants claims be dismissed in their entirety. The
    motion was partially successful.

[9]

The motion judge dismissed the claims for
    negligent and fraudulent misrepresentation and conspiracy.  He reasoned that
    the claim for misrepresentation should be dismissed because the elements that
    anchor a claim in misrepresentation were absent  most notably, reasonable
    reliance.  He concluded that there was no evidence to support the appellants
    conspiracy claim, and in any event, it was statute-barred because the appellant
    knew of its claim as of August 26, 2010 and the action was commenced more than
    two years later.  The appellant takes issue with these findings.

[10]

The motion judge made no error in finding that
    there was no reasonable reliance on the appraisal by the appellant.  The
    respondents were retained by the City.  By the appraisals terms, there was no
    expectation that anyone other than the City would rely on it.  More
    importantly, the evidence was clear that the appellant did not rely on the
    appraisal.  The motion judge was correct in dismissing the claims for
    misrepresentation.

[11]

The motion judge also correctly concluded that
    there was no evidence of any conspiracy between the respondents and the City.  Indeed,
    the record before the motion judge was devoid of a shred of evidence that could
    reasonably support such a finding.  The conspiracy claim was properly dismissed
    on that basis.

[12]

The appellant also takes issue with the motion
    judges determination that there is to be a mini-trial.  The appellant submits
    that the order for a mini-trial should be set aside and the remaining causes of
    action should proceed to trial.

[13]

We agree that the order for a mini-trial should
    be set aside but not for the reasons advanced by the appellant.

[14]

The motion judge concluded that a mini-trial
    was necessary to ascertain (i) whether Moore was an agent of the appellant with
    knowledge that was deemed to be that of the appellant; (ii) whether the
    Preliminary Agreement was enforceable given YMCAs withdrawal; and (iii) whether
    the limitation period for the claims of negligence, inducing breach of contract,
    and wrongful interference with economic relations had expired.

[15]

We see no reason for a mini-trial.  On its face,
    the appraisal revealed its basis and limitations.  Also, the limitation period would
    have commenced on August 26, 2010, when the appellant wrote to the City
    complaining about the appraisal.

[16]

The essence of the negligence claim as pleaded
    is that the respondents negligently prepared an appraisal that attributed an
    unjustified value to the property thereby causing the City to resile from the
    Preliminary Agreement and to reject the appellants further proposal for the
    purchase of the property.  For the purposes of the appeal, it is unnecessary to
    determine whether Moores knowledge in 2010 should be attributed to the
    appellants.  Given the allegations in the Statement of Claim, the evidence before
    the motion judge, and the appellants knowledge, the limitation period would
    begin to run in August 2010 when the appellant wrote complaining of the
    appraisal.  Thus, the claim for negligence cannot succeed.

[17]

Furthermore, the motion judge found that there was
    no reliance, no evidence of any purpose or intention to injure the appellant,
    and no evidence of any unlawful conduct by the respondents.  Given the evidence,
    the motion judges conclusions on reasonable reliance and his finding that
    there was no evidence that Indicom was acting in combination with the City to
    produce its appraisal with the predominant purpose, or for that matter any
    purpose to cause injury to CGI, or that its conduct was unlawful  the claims
    for inducing breach of contract and wrongful interference with economic
    relations have no possibility of success.

[18]

Moreover, in the Orangeville proceeding between
    the City and the appellant, Healey J. determined that the Preliminary Agreement
    and any subsequent agreements were unenforceable.  Before us, the appellant was
    unable to identify the particulars of any contract that the respondents could have
    conceivably breached.  Furthermore, there is no evidence that the respondents
    had knowledge of the Preliminary Agreement.  In fact, the evidence is to the
    contrary.

[19]

In addition, the issues identified for the
    mini-trial would have changed nothing.  Although, based on the pleading, it is
    difficult to imagine that Moore was not acting as the appellants agent when he
    received the appraisal, nothing turns on this, since the remaining claims cannot
    succeed.

[20]

For these reasons, the appeal of the dismissal
    of the conspiracy and misrepresentation claims is dismissed.  The order for a
    mini-trial is set aside, and the remaining claims are dismissed as well. See
Chidley-Hill
    v. Daw
, 2010 ONCA 835, 271 O.A.C. 135. This includes any
    breach of confidence claim against the respondents that the appellant claims to
    have pleaded.  The respondents moved for dismissal of the appellants entire
    claim against them, and there is no evidence to support a breach of confidence
    claim against them.

[21]

Given our disposition of the appeal, there is no
    need to address the jurisdictional issue relating to the cross-appeal or the
    cross-appeal itself as those issues are subsumed by the main appeal and hence
    moot.

[22]

The appellant shall pay the respondents costs
    of the appeal on a partial indemnity scale, fixed in the amount of $50,000
    inclusive of disbursements and applicable taxes.  There shall be no separate
    costs award for the cross-appeal.  The Barrie personal defendants shall bear
    their own costs of the appeal and cross-appeal.  The costs below are referred back
    to the motion judge for determination.

S.E. Pepall
    J.A.

G. Trotter
    J.A.

David M.
    Paciocco J.A.

[1]

Correct Building Corporation (CBC), the sole shareholder of
    CGI, also appealed from the judgment.  However, before the motion judge,
    counsel advised that CBC was no longer a plaintiff.  No order dismissing CBCs
    action against the respondents was brought to the motion judges attention and
    for greater certainty, he dismissed CBCs action against them.  Both CBC and
    CGI were included as appellants in the amended, amended notice of appeal but
    only CGI was advanced as an appellant on the appeal itself and in the factum
    filed.


COURT OF APPEAL FOR ONTARIO

CITATION: Correia v. Pinto, 2018 ONCA 382

DATE: 20180503

DOCKET: C64571

Hourigan, Benotto and Fairburn JJ.A.

BETWEEN

Maria Judite da Silva Correia

Plaintiff/Appellant

and

Teresa da Silva Pinto and Eduardo
    Pereira Pinto

Defendants/Respondents

Satish Mandalagiri, for the appellant

Edwin Upenieks and Angela Kwok, for the respondents

Heard: May 3, 2018

On appeal from the judgment of Justice Francine Van Melle
    of the Superior Court of Justice, dated October 13, 2017.

APPEAL BOOK ENDORSEMENT

[1]

The appellant appeals the decision of the motion judge who refused to
    restore this matter to trial list. We see no error in the motion judges
    decision. She carefully considered the facts and the relevant issues, including
    the issue of prejudice. We are also satisfied that she properly applied the
    correct legal test. There is no basis for appellate interference.

[2]

The appeal is dismissed. The appellant shall pay costs of the appeal to
    the respondents in the all-inclusive sum of $5,000.


COURT OF APPEAL FOR ONTARIO

CITATION: Cowan v. General Filters Inc., 2018 ONCA 445

DATE: 20180510

DOCKET: C61499

Pepall, Lauwers and Paciocco JJ.A.

BETWEEN

James Cowan and Shauna Cowan

Plaintiffs (Respondents)

and

General Filters Inc., Canadian General Filters
    Limited, Lippert & Wright Fuels Ltd. also known as Dave Lippert Fuels Ltd.,
    K & S Climate Control, Oil Tech Plus Ltd., John Doe, John Doe Company and
The
    Dominion of Canada General Insurance Company

Defendants (
Appellant
, Respondents)

and

Dana Canada Inc. Filter Division

Third Party (
Respondent
)

Christopher I.R. Morrison, for the appellant

Christopher A. Chekan, for the respondent Dana Canada
    Inc. Filter Division

No one appearing for the respondents James Cowan, Shauna
    Cowan, General Filters Inc., Canadian General Filters Limited, Lippert &
    Wright Fuels Ltd. also known as Dave Lippert Fuels Ltd., K & S Climate
    Control, and Oil Tech Plus Ltd.

Heard and released orally: May 4, 2018

On appeal from the order of Justice James W. Sloan of the
    Superior Court of Justice, dated December 11, 2015, with reasons reported at
    2015 ONSC 7773.

REASONS FOR DECISION

[1]

The respondent takes the position that this court does not have
    jurisdiction to hear this appeal because the order is interlocutory and the
    appeal lies to the Divisional Court with leave.

[2]

The appellant submits that this court has jurisdiction on the basis that
    the parties had reached a settlement agreement that the motion judge had no
    authority to decline to enforce.  It argues that it is a final decision that could
    not be raised again at trial.  It relies on
Fusarelli v. Dube
, [2005]
    O.J. No. 4398 (C.A.), and
Chertow v. Chertow
(2001)
, 146 O.A.C. 141.

[3]

In our view, these cases are distinguishable.  They both dealt with the
    existence of a r. 49 offer, pursuant to the
Rules of Civil Procedure
,

R.R.O. 1990, Reg. 194, that created a new
lis
, which is not the case
    here. The issue before the motion judge was whether certain of the parties
    could remove a defendant on consent when the third party opposed such a motion.

[4]

The order does not finally dispose of the action nor does it finally
    determine any claim or defence raised in the litigation or finally determine
    any substantive right of the parties. Rather, the order leaves these to be
    resolved by subsequent adjudication.  As such, the order is an interlocutory
    order, and this court does not have jurisdiction.

[5]

The appeal is quashed for lack of jurisdiction. The appellant is to pay
    the respondent $8,000 in costs on a partial indemnity scale inclusive of
    disbursements and applicable taxes.

S.E. Pepall J.A.

P. Lauwers J.A.

David M. Paciocco J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Crump v. Fiture, 2018 ONCA 439

DATE: 20180509

DOCKET: C64508

Hourigan, Benotto and Fairburn JJ.A.

BETWEEN

Jennifer
    Crump, Victoria Crump, Peter Crump and

Christopher Crump, by his Litigation
    Guardian, Victoria Crump

Plaintiffs

(Respondents)

and

Dr.
    Ali Otman Fiture
, Diane Pappas and

York Central Hospital

Defendant

(
Appellant
)

Sarit E. Batner and Carole Piovesan, for the appellant

Aleks Mladenovic and James V. Leone, for the respondents

Heard: May 4, 2018.

On appeal from the judgment of Justice Hugh K. OConnell
    of the Superior Court of Justice, dated October 3, 2017.

REASONS FOR DECISION

Introduction

[1]

The appellant, Dr. Ali Fiture,
    appeals from the trial judges judgment in a medical negligence action, wherein
    he was found to be negligent in the treatment of the respondent, Jennifer
    Crump.

[2]

For the reasons that follow, the appeal is
    dismissed.

Facts

[3]

Jennifer first complained of abdominal pain on
    May 20, 2000. At the time she was 11 years old. By the evening of May 23, she
    was still suffering from pain and her mother, Victoria Crump, took her to a walk-in
    clinic. She was seen there by Dr. Paul Woo, who concluded that she likely had
    acute appendicitis with perforation. He referred her to the emergency room at
    the local hospital.

[4]

In the emergency room, Jennifer was seen by Dr.
    Vito Sorrento, who also concluded that she potentially had appendicitis and referred
    her for a surgical consult. The appellant, a general surgeon, examined Jennifer
    at around 11:00 p.m. that evening. He concluded that she could be suffering
    from: (1) mesenteric adenitis secondary to respiratory tract infection and
    viremia; (2) menstrual pain related to cramps; or (3) early appendicitis.

[5]

The appellant did not order an ultrasound or
    admit Jennifer to the hospital. He discharged her and gave Victoria
    instructions, which will be discussed below, regarding the circumstances upon
    which Jennifer should be returned to the hospital.

[6]

The next day, May 24, Victoria took Jennifer to
    a scheduled appointment with her family doctor. The doctor instructed Victoria
    to follow the appellants advice.

[7]

Over the course of the next week, Jennifers symptoms
    remained stable. She had a mild fever, continued abdominal pain, and did not
    vomit. However, by May 30, Jennifers fever had increased so Victoria took her
    to the hospital. Due to the wait time there, Jennifer left with her mother
    without being seen by a doctor.

[8]

On May 31, Jennifer again saw her
    family doctor. Her fever had increased and she was referred to the hospital. At
    the hospital she underwent surgery. Her appendix had ruptured causing
    significant damage to her bowel.

The Trial Judges Decision

[9]

The parties agreed on the
    issue of damages. Thus, the trial was focused on whether the appellant was
    liable for Jennifers injuries.

[10]

There were four witnesses: Victoria; Dr.
    Raymond Mathews, the respondents expert witness; the appellant; and the appellants
    expert witness, Dr. Ian Soutter.

[11]

The trial judge concluded that the
    appellant had breached the requisite standard of care. He found that but for
    the appellants negligence, Jennifers appendix would not have ruptured nor
    would she have suffered the complications thereof.

Issues

[12]

The appellant submits that the trial judge
    erred in determining the standard of care of a general surgeon and in finding
    that causation had been established on a balance of probabilities. He further
    submits that the trial judges reasons were neither timely nor sufficient.

Analysis

(1)

Standard of Care

[13]

The appellant submits that Dr. Mathews
    admitted in cross-examination that the appellant met the standard of care
    required of a general surgeon at the time. In particular, he says that Dr.
    Mathews admitted that the standard of care did not require any one of: ordering
    an ultrasound, hospital admission, or scheduling a follow-up visit. Given this admission,
    the appellant submits that the trial judge erred in finding that one of those
    actions was required in the circumstances in order to meet the standard of care.
    The appellant says that this error was compounded when the trial judge essentially
    ignored Dr. Mathews admission on the basis that it was made during his
    cross-examination, when the witness was fatigued and exasperated.

[14]

We do not give effect to this argument.
    There was a divergence in the evidence between the appellant and Victoria
    regarding the appellants discharge instructions. The appellant has no
    independent recollection of treating Jennifer, but says that he told her mother
    to bring her back if she did not get better. The appellant maintains that this
    instruction accords with Dr. Matthews admission about the applicable standard
    of care.

[15]

Victorias evidence was that the instructions
    were to only bring her daughter back if her condition worsened. She says she was
    given no instruction about what to do if Jennifer did not improve.

[16]

The trial judge preferred Victorias evidence
    over the appellants on this issue. This was a finding of fact that was well
    grounded in the evidence. The appellant dictated a note, made contemporaneously
    with his examination of Jennifer, which includes the following comment: The
    mother is agreeable to monitor her at home and bring her back if she vomits,
    develops fever or more pain. Otherwise she will give her clear fluids today and
    advance her diet slowly. On Jennifers chart, he made the handwritten note:
    If problem ↑ return. There is no indication in the records that
    Victoria was told to return with Jennifer if her condition did not improve. The
    trial judge made no error in accepting Victorias version of events.

[17]

It is in the context of this finding that Dr.
    Mathews alleged admission needs to be considered. The question put to Dr.
    Mathews was:

Q. And so it would have been appropriate to
    give a discharge instruction which essentially puts the mother in charge; I
    want you to look at her. And this is what I want you to look for and if shes
    not better, I want you to bring her back, right? Thats what youre saying. If
    shes not better the following morning to return for reassessment, an
    ultrasound, thats what you say, right?

A. Right.

[18]

The factual premise underlying the question
    was not established, i.e. that Jennifer was to be brought back to the hospital
    the next morning if she was not feeling better. Therefore, there was no
    admission and the trial judge made no error in not relying upon the alleged
    admission.

[19]

We are also not persuaded that the trial
    judge erred in finding that the appellant should have prioritized appendicitis
    as a top drawer consideration in his differential diagnosis. That finding was
    also supported by the evidence. The appellants expert provided an opinion that
    the likelihood of appendicitis was very low. However, his expert report did not
    withstand cross-examination. The trial judge found that it was unreliable given
    that Dr. Soutter demonstrated a surgical bias to support the appellant.
    Further, he found that Dr. Soutter failed to mention a critical distinction
    between sets of studies that were relied upon in giving his opinion and that he
    cherry-picked statistics. Dr. Mathews evidence was that had he seen Jennifer
    on May 23, he probably would have operated on her that evening.

[20]

In our view, the trial judge made no
    palpable and overriding error in finding that the appellant fell below the
    requisite standard of care for a general surgeon as at the relevant time.

(2)

Causation

[21]

The appellant submits that the trial judge
    erred by relying solely on a different ranking of differential diagnosis as a
    basis for finding causation. This is not a fair reading of the trial judges
    reasons. In his reasons, the trial judge states:

Dr. Fiture fell below the standard of care of
    a similarly situated surgeon in his assessment of Jennifer Crump and also in
    his discharge instructions. Causation has been established. But for the
    negligence of Dr. Fiture, Jennifer Crump would not have suffered the issues
    that befell her when she was eventually operated on by Dr. Lee.

[22]

It is clear that the trial judge did not
    exclusively base his causation finding on the differential diagnosis, as he
    also relied on the finding that the appellant was negligent in his discharge
    instructions.

[23]

The appellant also argues that the trial
    judge erred in not taking into account that when Jennifers family doctor
    examined her on May 24, the doctor did not diagnose appendicitis or refer her
    to the hospital.

[24]

We would not give effect to this
    submission. The trial judge accepted Victorias evidence that she was told by
    the family doctor to follow the appellants advice. He also explicitly relied
    on Dr. Matthews evidence regarding causation, which he found to be
    uncontradicted. Dr. Matthews testified that in the circumstances a family
    doctor would defer to the advice given by a surgeon and he was of the view that
    Jennifer needed to be seen in a follow up visit by a surgeon, not a family
    doctor.

[25]

The appellants submission also ignores Dr.
    Soutters evidence that had Jennifer returned to the hospital either the next
    day or a day or two after, there was a likelihood that a diagnosis of
    appendicitis would have been made.

[26]

In summary, the causation finding was
    available to the trial judge on the evidence. There is no basis for appellate
    interference.

(3)

Timeliness and Sufficiency of Reasons

[27]

The appellant notes that the last witness
    testified at trial in May 2015 but that the reasons were not released until
    October 2017. He submits that in addition to being untimely, the reasons are
    also insufficient to permit appellate review.

[28]

We start with the sufficiency of the
    reasons. In our view, the reasons, when read in the context of the trial
    record, permit appellate review. While there are parts of the reasons that would
    have benefitted from a more detailed analysis, this court was able to
    understand the trial judges conclusions on the issues and how he reached them.

[29]

We are sympathetic to the appellants
    complaint about the timeliness of the reasons. Written submissions were filed
    in August 2015 and the reasons were not released until over two years later in
    October 2017. Although the reasons were released after what can only be
    described as an inordinate delay, we conclude that, in the context of this
    case, the delay did not impede the trial judges ability to fairly decide the
    case. This conclusion, however, should not be understood as excusing the delay.
    Litigants are entitled to a timely judicial determination and that did not
    occur here.

Disposition

[30]

The appeal is dismissed.

[31]

The respondents seek their costs of the
    appeal on a full indemnity or substantial indemnity basis. They submit that
    costs on a higher scale are justified because the appellant engaged in a
    scorched earth litigation strategy that increased costs. We are not satisfied
    that the manner in which the the appellant conducted the appeal warrants
    increased costs. On a partial indemnity basis, the appellant seeks costs in
    excess of $105,000. In our view, this amount is excessive. We award partial indemnity
    costs to the respondents in the all-inclusive sum of $80,000.

C.W. Hourigan J.A.

M.L. Benotto J.A.

Fairburn J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Davis v. East Side Mario's Barrie, 2018 ONCA 410

DATE: 20180501

DOCKET: C64555

MacFarland, LaForme and Epstein JJ.A.

BETWEEN

Katherine Irene Davis, Gregg James Davis and
    Paige Davis, a minor by her Litigation Guardian Katherine Irene Davis

Plaintiffs (Appellants)

and

East Side Marios Barrie

Defendant (Respondent)

J. Keenan Sprague, for the appellants

Robert Love and Edona Vila, for the respondent

Heard: April 10, 2018

On appeal from the order of Justice Chris de Sa of the Superior
    Court of Justice, dated August 4, 2017, with reasons reported at 2017 ONSC 6071.

MacFarland J.A.:

A.

Introduction

[1]

The appellants claims were dismissed following a motion for summary
    judgment. They appeal, arguing the motion judge erred.

[2]

While the motion judge did err, the correct result was reached. Accordingly,
    for the reasons that follow, I would dismiss the appeal.

B.

Background

[3]

On September 20, 2010 the appellant Katherine Davis, while carrying her
    newborn baby Paige, fell while going down a set of stairs to use a washroom
    located on the lower level of the respondents Barrie premises.

(1)

The first summary judgment motion

[4]

In the original statement of claim the allegations pleaded
    negligence, breach of duty, breach of contract and breach of the
Occupiers'
    Liability Act
, R.S.O. 1990, c. O.2 (the
OLA
)  were focused on
    the staircase on which the appellants fall occurred. The particulars pleaded
    in the original statement of claim were that the respondent:

a)

failed to take
    reasonable or any care to ensure that the plaintiff Katherine Irene Davis would
    be reasonably safe while walking in or about the Defendants premises;

b)

permitted or allowed
    the plaintiff Katherine Irene Davis to walk in or about the Defendants
    premises when it knew or ought to have known that it was unsafe and dangerous
    for the plaintiff to do so;

c)

failed to employ
    competent and experienced individuals to work at the Defendants premises;

d)

failed to implement or
    maintain any or adequate training programs to ensure that the persons chosen to
    work at the Defendants premises were sufficiently skilled, particularly with
    respect to proper safety procedures;

e)

failed to exercise any
    or adequate supervision or control over the persons chosen to work in the area
    of the store where the plaintiff Katherine Irene Davis was injured;

f)

failed to
    give the plaintiff Katherine Irene Davis reasonable or any adequate or
    effective warning of the dangerous situation which it knew or ought to have
    known existed;

g)

failed to have
    adequate lighting in the immediate area of the premises where the plaintiff
    Katherine Irene Davis was injured.

[5]

The respondent moved for summary judgment before Sutherland J. (the
    First Motion Judge) and in reasons delivered April 27, 2016 he concluded, at
    paras. 36 and 37:

I do not find that the plaintiffs have shown, on the balance of
    probabilities, that there is a genuine issue requiring a trial concerning
    whether the defendant did not take such care in doing an act or failed to do an
    act that did not make Katherine reasonably safe. It is unfortunate that
    Katherine fell down the stairs with her newly born daughter, Paige. But a fall
    in itself does not translate into a breach of duty of reasonable care by the defendant.

Thus, the plaintiffs have failed to provide evidence for which
    this court can find, on the balance of probabilities, that there is a genuine
    issue requiring a trial, being that the defendant breached its duty of care
    imposed by section 3 of the
OLA
.

[6]

The First Motion Judge also considered the appellants alternative
    argument advanced before him. He summarized this theory at para. 24 of his
    reasons, quoting from the appellants factum filed on the motion before him:

In this case it is the plaintiffs position that, in addition
    or in the alternative to allegations of breaches under the [
OLA
], the
    defendant breached its statutory warranty that its service supplied to the
    plaintiff would be of reasonably acceptable quality pursuant to the [
Consumer
    Protection Act
, 2002, S.O. 2002, c. 30, Sched. A, (the
CPA
)]
. The defendants breach stems from
    the failure to explicitly advise the plaintiff of the main floor washroom. Fair
    and just adjudication of this novel allegation requires a ruling on the interplay
    between the
CPA
and the [
OLA
], and whether the
CPA
imposes a
heightened
standard of care in the context of putting forth its argument of the
CPA
issue on a full factual record that would develop through regular trial
    procedure. [Emphasis in original.]

[7]

The First Motion Judge considered this argument and accepted that the
    interplay between the
CPA
and the
OLA
may be a novel argument
    and one which would have some significance in determining whether or not there
    was any duty on the respondent to advise Ms. Davis of the existence of a main
    floor washroom.

[8]

He noted that the statement of claim did not plead such a duty of care
    nor did it cite any section of the
CPA
. He said:

In effect, the plaintiffs are making arguments to fend off the
    summary judgment of the defendant but have not pleaded those novel claims of
    liability against the defendant.

[9]

Nor did the appellants seek to amend their pleading before the First Motion
    Judge. He found the allegations in the statement of claim as pleaded were not
    broad enough to include the novel claims being advanced before him.

[10]

The
    First Motion Judge granted summary judgment on the basis of the record before
    him and dismissed the appellants action as pleaded but did so without
    prejudice to the plaintiffs to bring a motion to amend their statement of claim
    to plead the novel questions of law described above.

[11]

As
    noted, before the First Motion Judge the appellants did not seek to amend their
    pleadings  the motion judge on his own motion permitted the amendment.

[12]

The
    motion was argued in February 2016 but the reasons were delivered in April 2016.
    There was no argument as to the propriety of those amendments at the time.

(2)

Appeal of the first summary judgment motion

[13]

The
    appellants appealed the judgment of the First Motion Judge to this court. The appeal
    was dismissed: 2016 ONCA 770.

[14]

Following
    the decision of the First Motion Judge, and before their appeal was heard, the
    appellants amended their statement of claim. The parties agreed to an order
    amending the statement of claim without prejudice to any of the Defendants
    rights, including but not necessarily limited to the Defendants right to bring
    a further motion for procedural/substantive relief on the grounds that the
    amendments do not disclose a cause of action, are barred by the
Limitations
    Act
,
2002
,
[S.O.
    2002, c. 24, Sched. B], and otherwise do not disclose a genuine issue requiring
    trial.

[15]

The
    amended statement of claim was not at issue before this court on the first
    appeal. This court noted, at para. 5, that the dismissal of the claim on the
    first branch of their theory of liability was amply supported by the
    evidence.

[16]

It
    went on to note, at para. 6, that the second branch of their theory of
    liability is expressly preserved by the motion judges judgment and, at para.
    7, that the appellants are not constrained from advancing the second branch of
    their liability case at trial.

[17]

It
    is clear that the propriety or lack thereof of those amendments  made after the
    First Motion Judges decision  was not before this court on the appeal of the
    First Motion Judges decision.

(3)

The second summary judgment motion

[18]

A
    second motion for summary judgment followed and proceeded before de Sa J. (the
    Second Motion Judge) and is the subject of this appeal.

[19]

The
    Second Motion Judge concluded, at para. 22:

In my view, it is essentially an alternative theory of
    liability for the same complaint that was before [the First Motion Judge]. I
    agree with the Plaintiffs that the Amended Claim does not advance a new cause
    of action for the purposes of the
Limitations Act
and under normal
    circumstances an amendment would be permissible under Rule 26.01 [of the
Rules
    of Civil Procedure
, R.R.O. 1990, Reg. 194].

[20]

He
    went on, however, despite the agreement of the parties to argue only the
    limitation point before him, to conclude that there was no genuine issue for
    trial and, at para. 24, stated:

Given that the Amended Claim relates to the same essential
    complaint, I cannot see how that cause of action can be revived simply by
    reframing the complaint in different legal terms. If that were permitted, it
    would render the original decision of [the First Motion Judge] meaningless.
    Given that the Plaintiffs have been precluded from relying on the condition of
    the stairs as a basis for liability, there is no residual merit to the cause
    of action advanced in the Amended Claim. The Plaintiffs cannot simply assert a
    general duty to advise of the existence of a main floor washroom as a distinct
    basis for liability. Accordingly, I find that summary judgment is warranted.

[21]

In
    the alternative, the Second Motion Judge would have held that, if the duty to
    advise of the main floor washroom was a distinct cause of action, it would be
    barred by the
Limitations Act
: see para. 25.

(4)

The current appeal

[22]

The
    appellants argue essentially that it was unfair for the Second Motion Judge to
    proceed further after finding that the amendments did not constitute a new
    cause of action. They submit that the parties had agreed to argue only the
    limitation issue and to defer any argument on the merits to a later date. They
    were, in essence, deprived of a fair hearing.

[23]

The
    respondents argue that the Second Motion Judge erred in his conclusion that the
    amendments did not constitute a new cause of action, but that his conclusion to
    the effect that the amendments offered no more than particulars of or a reframing
    of the same complaint that had been properly dismissed by the First Motion
    Judge is correct.

[24]

In
    light of the agreement of counsel as to the issue to be argued before the
    Second Motion Judge, this appeal falls to be determined on whether or not the Second
    Motion Judge erred in concluding that the amendments to the statement of claim
    did
not
constitute a new cause of
    action. The appellants concede that if they do, their claim is statute-barred.

C.

Analysis

[25]

What
    is a cause of action and what constitutes a new claim?

[26]

Each
    case of course falls to be determined on its own facts.

[27]

The
    original statement of claim here pleaded general negligence, breach of duty,
    breach of contract and breach of the
OLA
. The focus clearly was on the
    appellants fall down the stairs as the cause of her injuries. It was on the
    staircase and its condition  the area of the store where the plaintiff Katherine
    Irene Davis was injured. There is no mention whatsoever of the
CPA
,
    any interplay between the
CPA
and the
OLA
or of any failure on
    the part of the respondent to advise the appellant of the availability of a first
    floor washroom.

[28]

The
    amended claim on the other hand, is focused on the failure to advise and
    contains, beginning at para. 8(f.1), new pleas in support of what the
    appellants describe as their alternative theory of liability.

[29]

Those
    pleas are that the respondent:

(f.1)   failed
    to supply services of reasonably acceptable quality to the plaintiff contrary
    to subsection 9(1) of the [
CPA
] and/or contrary to the terms of the
    implicit or explicit terms of their contract;

(f.2)   failed
    to identify the plaintiff as a person that required the use of an accessible
    Family Washroom,

(f.3)   failed
    to advise the plaintiff of the existence and whereabouts of the accessible
    Family Washroom when it knew or ought to have known that stairs presented a
    safety hazard to the plaintiff.

(f.4)   failed
    to instruct its staff to advise customers who appeared in need of the
    accessible Family Washroom that there existed an accessible family washroom;

(f.5)   failed
    to provide any markings or signage to alert customers of the existence of the
    accessible Family Washroom [] and to direct customers to the location of the
    accessible Family Washroom.

[30]

Paragraph
    9 of the pleadings was also amended so as to read:

9.   The
    plaintiffs plead and rely upon the provisions of the
[
OLA
]
and amendments thereto
and the provisions of the [
CPA
]
.
    [Emphasis on additions.]

[31]

As
    this court recently said in
1100997 Ontario Limited v. North Elgin Centre
    Inc.
, 2016 ONCA 848, 409 D.L.R. (4th) 382, at para. 19:

A cause of action is a factual situation the existence of
    which entitles one person to obtain from the court a remedy against another
    person. [Citations omitted.]

[32]

And,
    quoting from Paul M. Perell & John W. Morden,
The Law of Civil Procedure
    in Ontario
, 3d ed. (Toronto: LexisNexis Canada, 2017), at p. 186:

A new cause of action is not asserted if the amendment pleads
    an alternative claim for relief out of the same facts previously pleaded and no
    new facts are relied upon, or amount simply to different legal conclusions
    drawn from the same set of facts, or simply provide particulars of an
    allegation already pled or additional facts upon [which] the original right of
    action is based.

See also
1100997 Ontario Limited
, at para. 20.

[33]

The
    Second Motion Judge and the First Motion Judge came to opposite conclusions on
    whether the original statement of claim was sufficient to include the
    appellants alternative theory of liability. The former said it was. The latter
    said it was not, and, without argument on the point, granted leave to amend.

[34]

In
    my view, the amended statement of claim does not merely provide particulars of
    the cause of action previously pleaded and the Second Motion Judge erred in so
    finding.

[35]

The
    original statement of claim focused on the staircase that they alleged was dangerous,
    inadequately maintained, poorly lit and caused the plaintiff to fall.

[36]

In
    the amended claim the plea is very different. The appellant pleads a new duty
    of care: a duty to advise the appellant of the existence and availability of
    washroom facilities on the main floor of the restaurant. They argue that
    provisions of both the
OLA
and the
CPA
support these arguments.
    While the
OLA
was pleaded in the original statement of claim, it was
    pleaded in relation to the condition of the staircase.

[37]

The
    new claim is a fundamentally different claim based on facts not originally
    pleaded.   It is not mere particulars of the prior claim. The
CPA
and
    its relationship with the
OLA
is a new plea in support of a new cause of
    action
[1]
and the Second Motion Judge erred in finding to the contrary.

[38]

Because
    the new plea raises a new cause of action, it is statute-barred as it is raised
    for the first time, long after the two year period of limitation has expired.

[39]

In
    the end, the Second Motion Judge achieved the right result but for the wrong
    reason.

D.

Disposition

[40]

The
    appeal is dismissed. Costs to the respondent fixed in the sum of $10,000
    inclusive of disbursements and applicable taxes as per the agreement of
    counsel.

Released: May 1, 2018 (H.S.L.)

J. MacFarland J.A.

I agree. H.S. LaForme J.A.

I agree. Gloria Epstein J.A.

[1]

Counsel for the appellant informed the court that, at the time
    he prepared the amended pleading and his materials for this appeal, he was
    unaware that this court had recently dealt with the issue of whether the
CPA
is properly applicable to occupiers cases. See
Schnarr v. Blue Mountain Resorts Limited
, 2018 ONCA 313.


COURT OF APPEAL FOR ONTARIO

CITATION: Design Filtration Microzone Inc. v. Cunningham,
    2018 ONCA 468

DATE: 20180518

DOCKET: C64414

Hoy A.C.J.O., Brown and Trotter JJ.A.

BETWEEN

Design Filtration Microzone Inc.

Appellant (Defendant)

and

Craig Cunningham

Respondent (Plaintiff)

Nigel McCready, for the appellant

D. Bruce Sevigny, for the respondent

Heard and released orally:  May 16, 2018

On appeal from the order of Justice Calum MacLeod of the Superior
    Court of Justice, dated September 7, 2017.

REASONS FOR DECISION

[1]

The appellant dismissed the respondent, without cause, on
    December 16, 2016. At the time, the respondent was 55 years of age.

[2]

The motion judge granted summary judgment in favour of the
    respondent, among other things, ordering the appellant to pay the respondent 12
    months salary, benefits and pension contributions in lieu of notice, and a
    $12,000 bonus for the year of termination. The appellant takes issue with both
    of these aspects of the judgment.

[3]

The appellant submits that in awarding the respondent a notice period of
    12 months, the motion judge placed too little emphasis on the fact that the
    respondent is a professional engineer with approximately two decades of
    management experience, and therefore should be attractive to potential
    employers; and too much emphasis on the respondents age, the character of his
    employment, and the specialized nature of his industry. The appellant renews
    its argument that a notice period of 8 to 10 months is appropriate.

[4]

We are not persuaded that there is any basis to interfere with the
    motion judges conclusion that a 12-month notice period is justified on the
    facts of this case. The motion judges determination of the period of
    reasonable notice is entitled to deference from this court. The motion judge
    made no error in principle. He considered the relevant factors and 12 months
    notice is reasonable in the circumstances. The appellants submission that the
    motion judge accorded too little weight to some relevant factors, and not
    enough to others, is an attempt to re-argue the motion.

[5]

Nor are we persuaded that there is any basis to interfere with the
    motion judges finding of fact that the appellant would have paid the
    respondent a discretionary bonus for 2016 if the decision to terminate him had
    not been taken. His finding is supported by the record, including the discovery
    evidence of the appellants President that he intended to pay the respondent a
    performance bonus for 2016 right up until the point that the appellants parent
    company advised him that the respondent was to be terminated.

[6]

As to the quantum of the bonus, we reject the appellants argument that
    this courts decision in
Paquette v. TeraGo Networks Inc.
, 2016 ONCA
    618, 269 A.C.W.S. (3d) 495 required the motion judge to average the bonuses the
    respondent received in the three years prior to dismissal. In
Paquette
,
    the court simply endorsed a calculation that the terminated employee in that
    case proposed and that had been utilized in another case. The court noted that
    the employer did not offer any evidence to suggest an alternative amount that
    the employee would have received by way of bonus. The quantum fixed by the
    motion judge in this case was reasonable, having regard to the amount of the
    discretionary bonuses paid to the respondent in the years that he received them
    and the appellants profit for 2016, before a reserve for this litigation was
    taken.

[7]

Accordingly, the appeal is dismissed. The respondent shall be entitled
    to his costs of the appeal fixed in the amount of $10,000, including disbursements
    and HST.

Alexandra Hoy
    A.C.J.O.

D.M. Brown J.A.

G.T. Trotter J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Gulf Developments Inc. v. Essex (Town), 2018 ONCA
    465

DATE: 20180517

DOCKET: C63244

Lauwers, Benotto and Nordheimer JJ.A.

BETWEEN

Gulf Developments Inc.

Plaintiff

(Respondent)

and

The Corporation of the Town of Essex

Defendant

(Appellant)

James K. Ball, for the appellant

Rodney M. Godard and Ioana Vacaru, for the respondents

Heard and released orally: May 16, 2018

On appeal from the judgment of Justice Scott K. Campbell of
    the Superior Court of Justice, dated December 16, 2016.

REASONS FOR DECISION

[1]

We agree with the trial judges finding, at paragraph 114 of his reasons,
    that the appellant used the post-tender addendum process as a form of
    impermissible re-tendering process, or what might be described as bid
    shopping, after the respondents bid was accepted.

[2]

The trial judge accurately recited the law related to the tender process
    prescribed by the Supreme Court of Canada in
R. (Ont.) v. Ron Engineering
,
[1981] 1 S.C.R. 111, and later cases.  He
    properly invoked the principle in
Martel Building Ltd. v. Canada
, 2000
    SCC 60, [2000] 2 S.C.R. 860, that all bidders are to be treated fairly. The trial
    judge also properly applied the law.

[3]

The trial judge said, at paragraphs 127 and 128:

I find the plaintiffs bid was accepted.  As previously stated,
    Town Council resolved to award the contract to Gulf.  This is apparent from the
    wording of the resolution, which stated the amount for which the contract was
    to be awarded.  As such, Contract B came into existence prior to the
    re-tendering process and the ultimate awarding of the contract to PCR, which
    amounted to a breach of Essexs contractual obligations to Gulf under Contract
    B.

If there were material issues that required re-tendering in
    some form, the municipality ought not to have awarded the contract to the
    plaintiff for a publicized amount.  I conclude that once the municipality
    issued the resolution they were required to issue a purchase order to the
    plaintiff.  The terms of the purchase order were to incorporate the CCDC 2
    contract.  That contract contains procedures to deal with changes in work or
    other disputes.  That is the procedure that ought to have been followed.

[4]

We agree.

[5]

On this basis, we dismiss the appeal.

[6]

As agreed by the parties, the costs are fixed in the amount of $12,500
    all inclusive, payable by the appellant to the respondent.

P. Lauwers J.A.

M.L. Benotto J.A.

I.V.B. Nordheimer J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Fontenelle v. Canada (Attorney General), 2018 ONCA
    475

DATE: 20180523

DOCKET: C64634

Lauwers, Benotto and Nordheimer JJ.A.

BETWEEN

James
    Fontenelle Jr., Tanya Brown, James Fontenelle Sr.

and Margina Fontenelle

Plaintiffs (Respondents)

and

The Attorney General of Canada
, Leonard Ballantyne, Terrance
    Bent

and Nickoma Cottrelle

Defendants (
Appellant
)

M. Sean Gaudet and Joel Levine, for the appellant

Doug Wright, for the respondents

Heard:  May 17, 2018

On appeal from the judgment of Justice David Price of the
    Superior Court of Justice, dated November 2, 2017, with reasons reported at
    2017 ONSC 6604.

REASONS FOR DECISION

[1]

The Attorney General of Canada appeals from the summary judgment granted
    by the motion judge who found in favour of the plaintiffs on the issue of
    liability but ordered the issue of damages to proceed to trial.

[2]

The action arises out of an assault that was committed on the
    respondent,
James Fontenelle Jr., (who we will
    refer to as the respondent) by the three named individual defendants, none of
    whom defended the underlying action.  The assault occurred while the respondent
    and the three individual defendants, were all inmates at Millhaven Institution,
    which is a maximum security penitentiary located in Bath, Ontario. The
    respondent was seriously injured.

[3]

The underlying action alleged that the Attorney
    General of Canada, as the representative of the Federal Crown, was negligent and
    breached a statutory duty of care by failing to keep the respondent reasonably
    safe while he was an inmate of the penitentiary.

[4]

The background facts can be stated fairly briefly.  At the time of the
    assault on October 8, 2013, the inmates in the unit in which the respondent was
    housed, were on strike in protest over the transfer of inmates from Kingston
    Penitentiary, which was being closed.  This strike had been ongoing for approximately
    a month.

[5]

As a consequence of the strike, the inmates were not being allowed
    outside into the yard or the gym.  Rather, they were only allowed outside of
    their cells for limited range activities, and then only at limited times.  There
    are surveillance cameras that cover the range but the cameras do not cover the
    insides of any of the cells.  Further, each cell is equipped with an alarm.  As
    part of the protest, inmates, including the respondent, would press the alarm
    even though there was no emergency.  Inmates would also cover their cell door windows
    and prop open the doors of their cells when out on the range. Prison staff were
    obligated to respond to any alarm.

[6]

On the evening of October 8, the respondent activated his cell alarm
    even though there was no emergency.  Prison staff attended and reset the
    alarm.  A few minutes later, six cell alarms were pressed at the same time,
    including the respondents.  Apparently this was to show the displeasure of the
    inmates that they had not, as yet, been allowed out of their cells.  Prison
    staff again attended and reset three of the six alarms.  They did not reset the
    respondents cell alarm.  There was no evidence why only three alarms were
    reset.

[7]

A few minutes later, the cell doors were opened to allow the inmates out
    onto the range.  For the next 30 minutes or so, the inmates on the range engaged
    in various activities. During this time, the respondent passed the defendant, Ballantyne,
    on the range a number of times, without incident.

[8]

At the end of this period, Ballantyne entered the respondents cell and
    left 14 seconds later. A couple of minutes later, the respondent popped his
    head out of his cell and appeared to speak to Ballantyne. The respondent tried
    to kick away the object propping open his door, but Ballantyne appeared to
    lunge to keep it open. Ballantyne then entered the respondents cell. The
    defendants, Cottrelle and Bent, stood outside the door. Ballantyne left a few
    minutes later. The motion judge found that the assault occurred at this time.
    The assault was not observed by prison staff because none of the staff are on
    the range when the inmates are out of their cells.  Rather, prison staff
    observe the activities on the range through the surveillance cameras.

[9]

About 15 minutes later, the prison staff and the inmate range
    representative reached an agreement by which the inmates returned to their
    cells.  At this point, the prison staff reset the other three cell alarms,
    including the respondents. About an hour later, staff conducted a patrol but
    did not observe any issues with the respondent.  About a further hour later,
    staff entered the range and observed that the respondent was in apparent
    distress. An ambulance was called and he was taken to Kingston General Hospital.

[10]

In
    his statement of claim, the respondent asserts negligence on behalf of the
    appellant, the particulars of which are pleaded as follows:

(a)

It failed to take reasonable care for the Plaintiffs safety;

(b)

It allowed the assailants to gain access to the Plaintiffs cell;

(c)

It failed to monitor the Plaintiffs cell properly to ensure that
    persons did not gain access to it;

(d)

It knew or ought to have known that an assault was occurring and it
    failed to intervene in a timely manner, or at all;

(e)

It failed to supervise the other Defendants properly, or at all;

(f)

It failed to have adequate policies in place to ensure the prisoners
    safety;

(g)

In the alternative, it failed to enforce its policies;

(h)

It failed to instruct its staff properly or at [
sic
] on safety
    matters;

(i)

It knew or ought to have known that the Plaintiffs safety was at risk
    and it did nothing to minimize the risk; and

(j)

It failed to make any reasonable assessment of the risk to the Plaintiff
    of being housed close to the other Defendants.

[11]

The
    appellant brought a motion for summary judgment seeking to have the action
    dismissed on the ground that there was no genuine issue requiring a trial.  In
    the alternative, the appellant sought an order bifurcating the action as
    between liability and damages.  There was no cross-motion by the respondent for
    summary judgment.

Analysis

[12]

In
    our view, the motion judge greatly exceeded his authority in granting summary
    judgment in this case in favour of the respondent.  In doing so, he made
    unjustified findings of fact.  The appellant also submits, with some warrant,
    that the motion judge proceeded contrary to the principles in
Rodaro v.
    Royal Bank of Canada

(2002), 59 O.R. (3d) 74 (C.A.), at paras.
    61-63. What is clear, given the factual issues that are in issue in this case, is
    that a trial is required to resolve whether the appellant is liable for the
    injuries sustained by the respondent.

[13]

In
    awarding summary judgment, the motion judge found, at para. 11 of his reasons,
    that the evidence leads to the inescapable conclusion that [Correctional Service
    Canada] was negligent, and that, but for its negligence, the injuries to [the
    respondent] would not have occurred.

[14]

The
    motion judge correctly cited the law that applies to summary judgment motions,
    particularly the decision in
Hryniak v. Mauldin
, 2014 SCC 7, [2014] 1
    S.C.R. 87.  More specifically, the motion judge quoted from
Hryniak
,
    at para. 49, where Karakatsanis J. said:

There will be no genuine issue requiring a trial when the judge
    is able to reach a fair and just determination on the merits on a motion for
    summary judgment. This will be the case when the process (1) allows the judge
    to make the necessary findings of fact, (2) allows the judge to apply the law
    to the facts, and (3) is a proportionate, more expeditious and less expensive means
    to achieve a just result.

However, he failed to properly apply that law in
    reaching his decision.

[15]

After
    this quotation, the motion judge said, at para. 56, that I am satisfied on
    the evidence tendered in the motion, that I have a full appreciation of the
    facts and am able to reach a fair and just determination on the merits  While
    the decision to exercise summary judgment powers is discretionary, deference is
    not owed to that decision where the motion judge comes to a decision that is
    so clearly wrong that it resulted in an injustice:
Hryniak
,
at para. 83.  That is what occurred in
    this case.

[16]

The
    motion judge made the following liability findings, at para. 70:

For the reasons that follow, I find that there was a
    foreseeable risk of harm to Mr. Fontenelle arising from CSCs placement of him
    in a tough unit within a maximum-security prison, among inmates, including
    Mr. Ballantyne, who had a known history of institutional violence against other
    inmates. That risk was heightened when CSC failed to dis-arm and re-arm Mr.
    Fontenelles call alarm, and permitted inmates, including Mr. Ballantyne, to
    enter Mr. Fontenelles cell, outside the range of surveillance cameras. I find
    that CSC failed to meet the standard of conduct that applied to it, that served
    to deter such violence and enable its staff to respond promptly and effectively
    if it occurred. In particular, CSC:

1.

Failed to
    install and maintain proper surveillance of the cell interiors;

2.

Failed to
    respond promptly and effectively to the activation of Mr. Fontenelles cell
    alarm;

3.

Failed to
    respond effectively to Inmates' propping open cell doors, and thereby allowed
    dangerous inmates to enter Mr. Fontenelles cell outside the range of security
    cameras;

4.

Failed to
    ascertain Mr. Fontenelles condition promptly following the assault and secure
    timely medical treatment for his injuries.

[17]

It
    is readily apparent from the nature of the allegations made in this case, and
    the factual findings made by the motion judge, that the evidentiary record was
    woefully inadequate to make a proper determination whether any duty of care
    owed by the appellant to the respondent in this case had been breached.  The
    motion judge erred in a number of respects in concluding otherwise.  It is not
    necessary to review each of those errors.  The following will suffice.

[18]

Regarding
    the placement of the respondent in the tough unit, the motion judge
    acknowledged that he did not have evidence respecting available institutional
    resources or whether there were alternative placements available to the
    appellant that would have been more appropriate for the respondent, given his
    inmate profile. He should not have proceeded to make a finding on this issue.

[19]

The
    motion judge also found that the appellant had been negligent because it failed
    to ensure that doors to the cells were kept closed while inmates were on the
    range (para. 93).  He found that this failure contributed substantially to
    the injuries that the respondent sustained.  In reaching this conclusion, the
    motion judge does not appear to have given any consideration to the fact that
    there was an inmate strike, that the inmates (including the respondent) were blocking
    their cell doors from being closed, and the safety risk posed to prison staff if
    they were to enter the range while the inmates were out of their cells.  Given those
    factors, the motion judge does not explain how the prison staff could
    reasonably be expected to ensure that the cell doors were kept locked.

[20]

The
    same factors ought to have been taken into account when the motion judge found
    that the appellant was negligent in not resetting the respondents cell alarm.
    There was no evidence why only three of the six alarms were reset.  The absence
    of that evidence ought to have concerned the motion judge in respect of any
    conclusion he might make about this issue.  In any event, given that at the
    time of the assault, the alarms still had not been reset, and yet the inmates
    were out on the range, it is not clear how the motion judge thought the prison
    staff were supposed to be able to then reset the alarms.  We repeat that the
    other three alarms had been reset prior to the inmates being allowed out on the
    range.

[21]

The
    motion judge also criticized the appellant for the failure to have surveillance
    cameras in each of the cells so that the authorities could monitor the
    activities in each cell.  The motion judge made this criticism without there
    being any evidence on this issue, including the costs associated with installing
    all of those cameras and the privacy concerns that the installation of such
    cameras would give rise to.

[22]

The
    motion judge also faulted the appellant for the delay that occurred in
    ascertaining the condition of the respondent after the assault.  On this point,
    it should be noted that the motion judge did not have any evidence from the two
    staff members who observed the respondent about an hour after the assault.  He
    also did not have any evidence from the respondent on this point.  Still
    further, the motion judge did not have any evidence that any delay in treatment
    had any impact on the respondents injuries.

[23]

Further,
    on more than one occasion, in the course of his reasons, the motion judge said
    that, but for a failing he identified on the part of the appellant, the assault
    would likely not have occurred.  That is not the correct legal standard for
    finding negligence.  Rather, the correct legal standard is that but for the
    negligence of the defendant the injuries would not have occurred.  As McLachlin
    C.J.C. said in
Clements (Litigation Guardian of) v. Clements
, 2012 SCC
    32, [2012] 2 S.C.R. 181, at para. 8:

The plaintiff must show on a balance of probabilities that but
    for the defendant's negligent act, the injury
would not
have occurred.

[Emphasis added.]

[24]

In
    the end result, the motion judge concluded that a trial was not necessary to
    determine liability in this case.  Rather, he determined that the appellant was
    liable to the respondent. We note that he reached that conclusion
    notwithstanding that the respondents position on the summary judgment motion
    was that a trial was necessary.  In reaching his conclusion, the motion judge
    pointed to the lack of evidence from certain staff members who had been
    involved in the incident and the failure of the three individual defendants to
    defend the action.  It is not clear what the significance of the latter is to
    the issue.  If the concern was that their evidence was not before the court, then
    that was another reason to send the matter to trial.  Whether or not the
    individual defendants defended the action, they are still subject to being
    called as witnesses at the trial.

[25]

The
    motion judges conclusion that a trial on liability was unnecessary cannot be
    sustained.  The evidentiary record before the motion judge was insufficient to
    reach a fair and just determination that any duty of care owed by the appellant
    to the respondent had been breached.  There was a need for much more evidence
    than the motion judge had on a variety of issues, such as the impact of the
    actions of the inmates on the ability of the prison staff to take certain steps,
    the actions surrounding the cell alarms, the liability consequences of finding
    that individual cells should have surveillance cameras, and so on.

[26]

It
    follows from that conclusion that the appellant was not entitled to summary
    judgment either.  This is an action that will have to proceed to trial absent
    the parties reaching any other resolution.  On that point, we do not see any
    reason to bifurcate the liability issues from the damages issues.  It would
    seem that the factual findings in the liability phase will assist in
    determining what, if any, damages are appropriate.

Conclusion

[27]

The
    appeal is allowed.  The summary judgment granted by the motion judge is set
    aside.  The appellants motion for summary judgment is dismissed.  The action
    is ordered to proceed in accordance with the
Rules of Civil Procedure
,
    R.R.O, 1990, Reg. 194.  The appellant is awarded its costs of the appeal, fixed
    in the agreed amount of $20,000, in the cause as also agreed between the
    parties.  The motion judges order reserving the costs of the motion to the
    trial judge remains.

P. Lauwers J.A.

M.L. Benotto J.A.

I.V.B. Nordheimer J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Halton Region Conservation Authority v. Hanna, 2018
    ONCA 476

DATE: 20180522

DOCKET: C58113

MacFarland, Watt and Paciocco JJ.A.

BETWEEN

Halton Region Conservation Authority

Appellant (Respondent)

and

J. Michael Hanna and Susan Carol Hanna

Respondents (Appellants)

Brian H. Greenspan, Robin McKechney and Peter Hamm, for
    the appellants

Kenneth Jull and Jonathan Nehmetallah, for the respondent

Heard and released orally: May 17, 2018

On appeal from the judgment of Justice Alan D. Cooper, of
    the Ontario Court of Justice, dated November 19, 2012, allowing a Crown appeal
    from the sentences imposed on January 24, 2011 by Justice of the Peace Lina M.
    Mills of the Ontario Court of Justice.

REASONS
    FOR DECISION

[1]

The appellants appeal, with leave of a single judge, from the decision
    of a judge of the Ontario Court of Justice sitting as a Provincial Offences
    Appeal Court (POAC) varying the sentence imposed by a justice of the peace in
    the Provincial Offences Court on pleas of guilty to two counts of breaching a
    regulation made under s. 28(1) of the
Conservation Authorities Act,
R.S.O.
    1990, c. C.27, thereby committing an offence under s. 28(16) of that
Act
.

[2]

At trial, after a contested sentencing hearing that lasted over two
    weeks, the presiding justice ordered that each appellant:

i.

pay a fine of $5,000; and

ii.

comply with the terms of a probation order for a period of two years among
    which was a requirement that they reconstruct a seawall on their property at
    their expense, by a specified date.

[3]

The Conservation Authority appealed the sentence to the POAC. The
    principal ground of appeal was that the trial justice erred in failing to order
    the now appellants to remove, at their expense, the addition they had made to
    their home. As it had at trial, there unsuccessfully, the Authority sought the
    removal order as a term of the probation order on the basis that the now
    appellants conduct amounted to a flagrant and deliberate breach of the
    regulation.

[4]

The judge of the POAC allowed the appeal by the Conservation Authority,
    set aside the sentence imposed at trial, and ordered that the fines be remitted
    to the now appellants; that the probation order requiring reconstruction of the
    seawall remain in effect; and that the now appellants be required to remove the
    addition to their home at their expense before a certain date.

[5]

In this court, the appellants seek reinstatement of the sentence imposed
    at trial. Reduced to its essence, they say that the judge of the POAC exceeded
    the scope of permissible appellate review by:

i.

reversing factual findings made by the trial court in the absence of any
    misapprehensions of evidence or palpable and overriding errors of fact;

ii.

reweighed the evidence adduced before the sentencing judge and
    substituted his own findings for those of the trial court; and

iii.

disregarded mitigating factors relied upon by the trial court.

[6]

The authority of the POAC on appeals from sentence under s. 122(1) of
    the
POA
is, with two exceptions not material here, identical to that
    in s. 687(1) of the
Criminal Code
. It is well established that
    sentences imposed by trial courts are entitled to and accorded substantial
    deference on appellate review. An appellate court is entitled to interfere with
    the sentence imposed at trial only where the trial court:

i.

errs in principle;

ii.

fails to consider a relevant factor; or

iii.

errs in considering an aggravating or mitigating factor

that has an impact on the sentence imposed, or imposes
    a sentence that is demonstrably unfit.

[7]

Critical to the Conservation Authoritys request for a removal order as
    part of the sentencing disposition was its submission that the conduct of the
    appellants was a flagrant and deliberate breach of the governing Regulations.
    As an aggravating factor on sentence, it was incumbent on the Authority to
    prove this allegation on the evidence adduced at the hearing beyond a
    reasonable doubt. The trial court made a specific finding of fact, a finding
    based on the whole of the evidence adduced on the sentencing hearing, and one
    that involved an assessment and weighing of controverted evidence and findings
    of credibility, that the appellants conduct did
not
constitute a
    flagrant and deliberate breach of the Regulations.

[8]

The judge of the POAC found that:

i.

the Conservation Authority had proven the disputed aggravating factor,
    that is to say, the flagrant and deliberate breach of the Regulations, beyond a
    reasonable doubt; and

ii.

the nature of the breach warranted a removal order.

[9]

It was not open to the judge of the POAC to simply substitute his view
    of the nature of the appellants breach of the Regulation for that of the trial
    court.

[10]

Findings
    of fact are the bedrock of sentencing proceedings. They are critical to a
    determination of the circumstances that may aggravate or mitigate a sentence.
    In many instances, as here, findings of fact that determine whether an
    aggravating or mitigating circumstance will have a say in the ultimate
    sentencing decision will be made on conflicting evidence. And findings of fact
    are the province of the sentencing judge who is an ear and eyewitness to the
    conflicting evidence. At one remove, a reviewing court is not entitled, nor
    should it be, to interfere with findings of fact made at trial in the absence
    of palpable and overriding error.

[11]

In
    this case, the judge of the POAC does not identify any palpable and overriding
    error in the trial courts finding on the critical issue of moral
    blameworthiness. It follows that the appeal judge was
not
entitled to
    interfere with that finding, much less to substitute a contrary finding funded
    in part by impermissible speculation about one of the appellants knowledge of
    applicable residential building restrictions.

[12]

In
    the result, we are satisfied that the appeal judges decision is flawed by
    fundamental errors and cannot stand. The appeal is allowed, the decision of the
    judge of the POAC is set aside and the decision of the POC restored to this
    extent: each appellant will pay a fine of $5,000. In light of the fresh evidence
    that the terms of the probation order, including reconstruction of the seawall,
    have been satisfied, we see no need to make any further orders.

J. MacFarland J.A.

David Watt J.A.

David M. Paciocco J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Hanson v. Totten Insurance Group Inc., 2018 ONCA
    446

DATE: 20180510

DOCKET: C64230

MacFarland, LaForme and Epstein JJ.A.

BETWEEN

Nicola Anne Hanson and Paul Hanson

Plaintiffs (Appellants)

and

Totten Insurance Group Inc.
, Ives
    Insurance Brokers Ltd.,
John Malac
,
Lynne Malac
and
Lloyds
    Underwriters

Defendants (
Respondents
)

Steven Pickard, for the appellants

Mikel Pearce and Brett Stephenson, for the respondents
    Totten Insurance Group Inc. and Lloyds Underwriters

Michael Stocks, for the respondents John Malac and Lynne
    Malac

Heard: April 11, 2018

On appeal from the judgment of Justice Pamela L. Hebner
    of the Superior Court of Justice, dated August 11, 2017, with reasons reported
    at 2017 ONSC 4809.

MacFarland J.A.:

A.

Introduction

[1]

This
    is an appeal from a judgment dismissing the appellants motion for summary
    judgment in a mortgage enforcement action. The respondents, Lloyds
    Underwriters (Lloyds) and Totten Insurance Group Inc. (Totten), had issued
    a policy of insurance to the respondents, John and Lynne Malac, the mortgagees
    of the Hanson property. Following a loss to the Hanson property, Lloyds paid
    the Malacs their mortgage loss and claim, through subrogation, against the
    Hansons. The Hansons brought a motion for summary judgment in which they sought
    a determination as to whether the Lloyds policy covered their interest in the
    property so that the payment on the policy extinguished the mortgage debt.

[2]

In
    the usual situation of a homeowner with a mortgaged property, the homeowner, as
    required by standard mortgage terms, obtains and pays for a policy of insurance
    in his or her name. That policy will cover the homeowners interest in the
    property as well as the interest of the mortgagee. It is common practice for
    such policies to contain what is known as a standard mortgage clause. Such a
    clause will protect the interest of a mortgagee despite an act of the insured
    homeowner that would otherwise breach policy conditions. See, generally:
    Gowling Lafleur Henderson LLP,
Marriott and Dunn: Practice in Mortgage
    Remedies in Ontario
, loose-leaf (2018-Rel. 1), 5th ed. (Toronto: Thomson
    Reuters, 1994), vol. 2 at pp. 50-7 to 50-13; and Walter M. Traub,
Falconbridge
    on Mortgages
, loose-leaf (2017-Rel. 25), 5th ed. (Toronto: Thomson
    Reuters, 2017), at pp. 38-7 to 38-15.

[3]

However,
    in this case the appellants, who had obtained a private mortgage in the sum of
    $250,000 from the Malacs, were unable to obtain property insurance. The Malacs
    obtained a policy of insurance for $200,000 in their own names which was underwritten
    by Lloyds. That policy stated that it protected only the interest of the Malacs
    as mortgagees.

[4]

The
    main issues in this appeal are: (1) whether the Lloyds policy also covers the appellants
    interest in the property; and (2) whether Lloyds is entitled to exercise its
    right of subrogation having paid out the mortgagees interest.

[5]

For
    the reasons that follow, I would dismiss the appeal.

B.

Background

(1)

History of the property

[6]

The
    subject property is owned by the appellant, Nicola Hanson. In August 2006, she
    granted a mortgage in favour of the Malacs. Paul Hanson is the husband of
    Nicola Hanson and the guarantor of that mortgage. For a number of years after
    the mortgage was placed, the appellants arranged the necessary insurance
    coverage for the property. Such insurance was taken out and paid for by the
    plaintiffs as mortgagor and covered both their interest in the property as well
    as that of the Malacs as mortgagee.

[7]

In
    September 2010, Allstate Insurance Company of Canada (Allstate), then the
    insurer of the property, cancelled its policy of insurance. The record suggests
    that its reasons for cancellation may have included the Hansons claims
    history, possible non-payment of premiums, breach of policy conditions and
    misrepresentation. Issues between the Hansons and Allstate are the subject of a
    separate proceeding.

[8]

However,
    when the Hansons were unable to obtain replacement insurance, the Malacs,
    concerned about their interest as mortgagee, offered to obtain insurance for
    which the Hansons would pay, as they were obligated to do under the standard
    terms of the mortgage.

[9]

The
    Malacs were told by both Allstate and their own agent that because they were
    not the owners of the property they could not insure in the Hansons names and
    they could only insure for their interest as mortgagees. This information was
    passed from the Malacs to the Hansons. The Hansons were also informed that they
    should contact the Malacs agent, Ives Insurance Brokers Ltd., to arrange
    insurance to cover their own interest in the property. The Hansons did not do
    so.

[10]

The policy which the
    Malacs obtained, names John Malac & Lynne Malac as insureds. The risk
    location is the address of the subject property in Kingsville, Ontario. The
    business insured is described as mortgagee. The property is noted to be a
    primary residence occupied by others. The coverage is described as Commercial
    Property  Named Perils Form Building. The face of the policy bears the
    notation Mortgagee Interest  No Co-Insurance Endorsement.

[11]

The policy limit was $200,000
    and the coverage initially was from October 10, 2010 to October 10, 2011. The
    policy was renewed twice before the events which give rise to this suit
    occurred in June 2013. The Malacs paid the premium for the policy and were
    subsequently reimbursed by the Hansons.

[12]

The policy contains
    the following term:

THIS
    ENDORSEMENT CHANGES THE POLICY
.

PLEASE READ
    IT CAREFULLY
.

MORTGAGE
    INTEREST  NO CO-INSURANCE ENDORSEMENT

[13]

This endorsement
    modifies the coverage provided as follows:

PROPERTY SECTION

Co-Insurance:
      It is noted and agreed that this policy is written on a No-Co-Insurance basis
    and that the sum insured is in the interest of the named Insured in their
    capacity as Mortgagee on the premises insured by this policy. In the event of a
    loss, this policy shall protect only the interest of the Named Insured and no
    other party.

[14]

Usual statutory and
    general conditions are attached and include General Condition G, which
    includes the following:

G) SUBROGATION

VII. The Insurer, upon making any payment or assuming liability
    therefor under this Policy, shall be subrogated to all rights of recovery of
    the Insured against others and may bring action to enforce such rights.

[15]

Also included is a
    standard mortgage clause, the relevant provisions of which provide:

It is hereby provided and agreed that:

1.       Breach Of Conditions By Mortgagor Owner Or Occupant
    This insurance and every documented renewal thereof  as to the interest of the
    Mortgagee only therein  is and shall be in force notwithstanding any act,
    neglect, omission or misrepresentation attributable to the Mortgagor, Owner or
    occupant of the property insured, including transfer of interest, and vacancy
    or non-occupancy, or the occupation of the property for purposes more hazardous
    than specified in the description of the risk

2.       Right Of Subrogation  Whenever the Insurer pays the
    Mortgagee any loss award under this policy and claims that  as to the
    Mortgagor or Owner  no liability therefore existed, it shall be legally
    subrogated to all rights of the Mortgagee against the Insured; but any
    subrogation shall be limited to the amount of such loss payment and shall be
    subordinate and subject to the basic right of the Mortgagee to recover the full
    amount of its mortgage equity in priority to the Insurer

[16]

In June 2013, the
    property was substantially damaged by fire and was ultimately demolished. The
    Malacs claimed their mortgage loss from the insurer and were initially paid
    $100,000 and told a second cheque for $100,000 would follow shortly. Soon
    after, the insurers took the position that the Malacs had suffered no loss
    because the Hansons continued to make their monthly mortgage payments (and the
    mortgage was not due until December 2014). The Malacs returned the $100,000
    they had been paid.

[17]

The mortgage came due
    in December 2014 and when it was not paid, the Malacs began power of sale
    proceedings in February 2015. The insurers later paid the Malacs the $200,000
    of insurance monies and claimed to be subrogated to the Malacs rights to
    enforce the mortgage debt.

[18]

There is an obvious
    shortfall in the monies owed to the Malacs  the insurance limit did not cover
    the full amount of the debt. The Malacs wish to recover that shortfall.

(2)

The current proceedings

[19]

The appellants
    commenced this proceeding very soon after, on March 2, 2015. Within days of
    commencing their proceeding they moved for an order to prevent the Malacs from
    taking any steps to enforce the mortgage. Their motion was adjourned,
sine
    die
,
and an order entered
    on consent, establishing that the Malacs would take no steps to enforce the
    mortgage pending the return of the motion. The motion has not been returned. Meanwhile
    interest accrues, and the Malacs continue to pay the taxes and the arrears
    increase.

[20]

Oral and documentary
    discovery took place and in July 2016, the appellants moved for summary
    judgment. The motion was heard in February 2017, with the plaintiffs claiming:

a)       A Declaration that Lloyds Underwriters have no
    subrogated right to bring mortgage enforcement proceedings in respect of a
    mortgage dated August 4, 2006, and subsequently renewed on December 15, 2012
    and now matured on December 15, 2014 on the property owned by the plaintiff at [Kingsville,
    Ontario];

b)       An Order directing the defendants John and Lynne Malac
    and / or Lloyds Underwriters to provide a discharge of the said mortgage, to
    the extent that the balance owing on the mortgage has been paid down by the
    proceeds of insurance;

c)       An Order for an accounting of all monies paid and
    received on account of the balance due and owing on the said mortgage,
    crediting all funds received by John and Lynne Malac from Lloyds Underwriters
    respecting an insurance policy placed by them on the subject property; [and]

d)       An Order restraining the defendants John and Lynne
    Malac and / or Lloyds Underwriters as subrogee from taking or continuing any
    mortgage enforcement proceedings pursuant to the aforesaid mortgage[.]

[21]

The motion judge
    dismissed the motion in its entirety. After reviewing s. 6 of the
Mortgages
    Act
, R.S.O. 1990, c. M.40,
and
    concluding
that the purpose of this section
    is to benefit only the mortgagee, she noted, at para. 26, that the standard
    charge terms had a similar purpose
:

The same can be said for the standard charge terms of the
    mortgage, para. 16 set out above. The obligation to insure is on the mortgagor
    and not the mortgagee. If the mortgagor fails to obtain insurance, the
    mortgagee
may
obtain insurance itself and require the mortgagee to pay the premium. This term
    is for the benefit of the mortgagee and the mortgagee alone. [Emphasis in
    original.]

[22]

She reviewed the
    authorities on which the appellants relied, including
Sanofi Pasteur Ltd.
    v. UPS SCS, Inc.
, 2014 ONSC 2695, 119 O.R. (3d) 789, affd 2015 ONCA 88, 124
    O.R. (3d) 81, leave to appeal refused, [2015] S.C.C.A. No. 152. She concluded
    that because of paragraph 16 of the Standard Charge Terms, which formed part of
    the mortgage, the appellants assumed the risk of loss.

[23]

She held, at para. 31,
    that the terms of the policy and the evidence of the appellants was consistent
    with the conclusion that the policy was only for the benefit of the Malacs and
    further, at para. 34, that Lloyds subrogation right was enforceable against
    the mortgagors.

C.

Analysis

(1)

Does the Lloyds policy cover the appellants interest in the property?

[24]

In this court, the
    appellants argue that the motion judge erred in reaching the conclusion that
    the policy was only for the Malacs benefit. They contend that the only
    reasonable interpretation of Standard Charge Term 16 is that a mortgagee must
    obtain insurance that will cover the interests of both the mortgagor and
    mortgagee when a mortgagor does not, for whatever reason, insure the subject
    property.

[25]

Standard Charge Term
    16 provides:

The Chargor will immediately insure, unless already insured,
    and during the continuance of the Charge keep insured against loss or damage by
    fire, in such proportions upon each building as may be required by the Chargee,
    the buildings on the land to the amount of not less than their full insurable
    value on a replacement cost basis in dollars of lawful money of Canada. Such
    insurance shall be placed with a company approved by the Chargee. Buildings
    shall include all buildings whether now or hereafter erected on the land, and
    such insurance shall include not only insurance against loss or damage by fire
    but also insurance against loss or damage by explosion, tempest, tornado,
    cyclone, lightning and all other extended perils customarily provided in
    insurance policies including all risks insurance. The covenant to insure
    shall also include where appropriate or if required by the Chargee, boiler,
    plate glass, rental and public liability insurance in amounts and on terms
    satisfactory to the Chargee. Evidence of continuation of all such insurance
    having been effected shall be produced to the Chargee at least fifteen (15)
    days before the expiration thereof;
otherwise
    the Chargee may provide therefor
and charge the premium paid and
    interest thereon at the rate provided for in the Charge to the Chargor and the
    same shall be payable forthwith and shall also be a charge upon the land. It is
    further agreed that the Chargee may at any time require any insurance of the
    buildings to be cancelled and new insurance effected in a company to be named
    by the Chargee and also of his own accord may effect or maintain any insurance
    herein provided for and any amount paid by the Chargee therefor shall be
    payable forthwith by the Chargor with interest at the rate provided for in the
    Charge and shall also be a charge upon the land. Policies of insurance herein required
    shall provide that loss, if any, shall be payable to the Chargee as his
    interest may appear subject to the standard form of mortgage clause approved by
    the Insurance Bureau of Canada which shall be attached to the policy of
    insurance. [Emphasis added]

[26]

This provision
    contemplates two scenarios, one where the mortgagor/chargor obtains insurance,
    and the second where the mortgagee/chargee obtains insurance.

[27]

The appellants argue
    that the language otherwise the Chargee may provide
therefor
and charge (emphasis added) can
    only mean that the mortgagee/chargee, if it chooses to obtain insurance
    coverage, must obtain the same coverage that the mortgagor/chargor is required
    to obtain. They argue the word therefor can only refer back to the language in
    the earlier portion of the provision which outlines the mortgagors/chargors
    obligation to insure.

[28]

There are a number of
    difficulties with this argument.

[29]

First, the obligation
    to insure lies on the mortgagor/chargor in the first instance and is mandatory
     the mortgagor/chargor will immediately insure. There is no obligation on
    the mortgagee/chargee to insure. That portion of the clause dealing with the mortgagees/chargees
    right to insure is merely permissive  the mortgagee/chargee
may
provide therefor (emphasis added). The
    appellants argument converts the permissive language of this term into a mortgagees/chargees
    mandatory obligation to obtain like insurance.

[30]

Second, as the Malacs discovered,
    mortgagees/chargees can only obtain insurance in their own names to cover their
    own interest in the subject property. The Malacs do not have an insurable interest
    in the equity of redemption  only the Hansons do. They told the Hansons this
    after their efforts to obtain coverage for them failed and their broker told
    them they could only get insurance for their interest as mortgagees/chargees.

[31]

Finally, this term is
    for the benefit of mortgagees/chargees. The property is to be insured by the mortgagor/chargor
    and the cost of that insurance is to be borne by the mortgagor/chargor. The assumption
    of risk lies with the mortgagor/chargor, not the mortgagee/chargee.

[32]

Next the appellants
    argue that because they paid the premiums for the insurance they are entitled
    to the benefit of any such coverage. The contract provides that the cost of
    such insurance is to be borne by the mortgagor/chargor and that includes the
    cost of
any
insurance obtained by the mortgagee/chargee.

[33]

Any policy obtained by
    the mortgagor/chargor is to provide that loss is to be payable to the mortgagee/chargee
    as its interest may appear and is to have a standard form of mortgage clause
    attached.

[34]

Reading Standard
    Charge Term 16 as a whole, there can be no doubt that, as the motion judge
    found, this term is for the benefit of the mortgagee/chargee and the mortgagee/chargee
    alone.

[35]

It is important to
    remember that a mortgage is, in its essence, a loan agreement. In the usual
    circumstances, the mortgage provides a significant sum of money to a mortgagor/chargor
    to acquire a property. There is a cost to obtain that loan. It includes
    interest on the principal sum but also other obligations that the mortgagor/chargor
    is required to pay and maintain. Where the mortgagor/chargor fails to make
    these payments, they are added to the principal sum of the mortgage and can be
    enforced in the same way: see
Marriott and Dunn
, at p. 50-4.

[36]

In the usual case, where the mortgagor/chargor obtains the required
    coverage to cover both its interest and that of any mortgagee/chargee and a
    loss occurs, on the insurers payment to the mortgagee/chargee of the mortgagees/chargees
    loss, the insurer is subrogated to the mortgagees/chargees rights. There
    usually are two conditions before the insurer can exercise those rights: (i) it
    must pay the mortgagees/chargees loss under the policy; and (ii) it must
    demonstrate that it owes nothing to the mortgagor/chargor. Once those
    conditions are satisfied the insurer may proceed with a subrogated claim
    against the mortgagor/chargor, limited, of course, to the amount it has paid to
    the mortgagee/chargee:
Pinder v. Farmers Mutual Insurance
Company
,
    2009 ONCA 831, 100 O.R. (3d) 200
, leave to appeal
refused,
[
2010] S.C.C.A. No. 10
.

[37]

That is not the
    situation in this case. Here the insurance was obtained by the mortgagees/chargees
    to cover only their interest in the subject property  their mortgage interest.
    Although the standard mortgage clause contains the language that references the
    second condition required by
Pinder
, that condition does not arise on
    the facts of this case as the Hansons have no interest in the subject policy
    and the entire limits of the policy were properly paid to the mortgagees/chargees.
    The policy proceeds were insufficient to cover the entire mortgage debt and accordingly,
    the Malacs are free to pursue the appellants for recovery of the remainder of that
    debt  and, as stated in the standard mortgage clause provision entitled Right
    Of Subrogation, in priority to the claim of the insurers.

[38]

As the motion judge
    found at para. 29:

When the Hansons failed to insure the property, the Malacs were
    free to do so at their option. Moreover, they were free to obtain whatever
    insurance they saw fit. There was no obligation on the Malacs to protect the
    Hansons from loss.

[39]

The appellants
    argument that the Hansons expected that the insurance policy would cover their
    interest was rejected by the motion judge. She concluded, at para. 32:

The Hansons knew, at all material times, that the insurance
    policy obtained by the Malacs was not for their benefit. This is consistent
    with the intention expressed in the policy.

[40]

Her finding in this
    regard is well-supported on the record before her including: the language of
    the insurance policy; the evidence of Lynne Malac; the evidence of Nicola
    Hanson; and the evidence of the senior claims adjuster assigned by Lloyds.

(2)

Is Lloyds entitled to exercise its right of subrogation?

[41]

At the end of her
    reasons the motion judge declined to set aside the Order of Howard J. dated May
    19, 2015. That order, made on consent, adjourned the appellants motion for an
    interlocutory injunction to prevent the Malacs from taking steps to proceed with
    their Notice of Sale proceedings. The term of the adjournment required the
    Malacs to take no steps to enforce the mortgage pending the return of that
    motion.

[42]

The motion judge
    concluded at para. 36, that the motion has not yet been returned. Accordingly,
    it is not before me. Under those circumstances, I decline to set aside the
    consent order.

[43]

In my view, it is
    immaterial that the parties adjourned the Hansons motion for an interlocutory
    injunction on consent in the face of the subsequent findings made on the
    summary judgment motion and affirmed in this appeal. It is important to note
    that the very basis for the adjourned injunction motion rests on the allegation
    that the Malacs undertook to obtain property insurance for the benefit of the Hansons
    and that although the named insureds were the Malacs, the policy was for the
    sole benefit of the Hansons. As indicated above, I agree with the conclusion of
    the motion judge that the policy was instead for the sole benefit of the Malacs,
    and not for the benefit of the Hansons. Accordingly, the Hansons cannot re-litigate
    what has already been determined in the present proceeding.

[44]

In any event, while
    there were no direct proceedings before the motion judge in relation to Justice
    Howards order, the appellants did seek before her:

d)       An order restraining the defendants John and Lynne
    Malac and / or Lloyds Underwriters as subrogee from taking or continuing any
    mortgage enforcement proceedings pursuant to the aforesaid mortgage.

[45]

This request is essentially
    the very same relief the appellants sought in their adjourned motion for
    injunctive relief and, in my view, overtakes those earlier interlocutory
    proceedings. In effect, the motion judge fully dealt with the Hansons ability
    to restrain the Malacs and Lloyds from continuing mortgage enforcement
    proceedings as if the adjourned motion for injunctive relief had been returned.

[46]

Their motion for
    summary judgment having been dismissed in its entirety, including their request
    for injunctive relief, there is no remaining impediment to the Malacs and the
    insurers proceeding with their power of sale proceedings.

[47]

For these reasons I
    would dismiss the appeal.
[1]

[48]

I would award costs to
    the respondent insurers fixed in the sum of $15,000 and to the Malacs in the
    sum of $10,000. Both awards are inclusive of disbursements and HST.

Released: May 10, 2018 (H.S.L.)

J.
    MacFarland J.A.

I agree.
    H.S. LaForme J.A.

I agree.
    Gloria Epstein J.A.

[1]

Appeals from dismissals of summary judgment motions
    are generally considered to be appeals of interlocutory orders: see
Skunk v. Ketash
, 2016
    ONCA 841, 135 O.R. (3d) 180. The issue was not argued by either party on this
    appeal. In any event, where, as in this case, a motion judge finally decides
    all of the disputed issues, the order may be final: see
Del Ridge Construction Inc. v. General Accident
    Assurance Co. of Canada
(2005), 27 C.C.L.I. (4th) 42
    (Ont. C.A.). In my view, the principle from
Del Ridge
applies in this
    case and the appeal properly lay to this court.