COURT OF APPEAL FOR ONTARIO

CITATION:
Bank of Montreal v. EL04 Inc.

(Just Between Us and Pink Elephant), 2012 ONCA 80

DATE: 20120207

DOCKET: C54214

Laskin, Sharpe and Juriansz
    JJ.A.

BETWEEN

Bank of Montreal

Plaintiff (Respondent/                                                                                Appellant
    by way of Cross-Appeal)

and

EL04 Inc. trading as Just Between Us and Pink
    Elephant, and
Elizabeth
Stolper
also known as Liz
Stolper
also known as Elizabeth
    Derksen

Defendant (
Appellant/Respondent
    by way of Cross-Appeal
)

David Swift, for the appellant/respondent by way of
    cross-appeal

Sean N.
Zeitz
, for the
    respondent/appellant by way of cross-appeal

Heard: January 9, 2012

On appeal and cross-appeal from the judgment of Justice Peter
    B.
Hambly
of the Superior Court of Justice, May 30,
    2011 with reasons reported at 2011 ONSC 2115.

Laskin J.A.:

A.

introduction

[1]

Elizabeth
Stolper
appeals from the summary judgment finding her personally liable to the
    respondent, the Bank of Montreal.  The
    Bank seeks leave to cross-appeal the motion judges costs award.  The motion judge found that Ms
Stolper's
company, EL04, and her father's company,
Deln
Construction, had engaged in a non-arm's length
    transaction for less than fair market value. Under the former s. 100 of the
Bankruptcy and Insolvency Act
, R.S.C. 1985, c. B-3,
this made EL04 liable to
Deln's
creditors after
Deln
went
    bankrupt. The motion judge also found Ms
Stolper
personally liable as "privy" to the transaction. His finding that Ms.
Stolper
was privy is the main issue on this appeal.

B.

a brief summary of the facts

(1)

The Parties

[2]

EL04 operated two businesses: a clothing store
    called Just
Between
Us, and a marketing and consulting
    business called Pink Elephant.  Ms.
Stolper
was the sole officer and director of EL04.  Just
Between
Us
    ceased operations in 2010.

[3]

Deln
was a
    contractor.  Ms.
Stolpers
father, Herman Derksen was the companys principal.  Ms.
Stolpers
husband, Jason
Stolper
, was an officer and employee
    of the company.  In September 2008,
Deln
made an assignment in bankruptcy.  KPMG Inc. was appointed trustee.  At the time of the bankruptcy, the respondent,
    the Bank of Montreal, was a proven creditor of
Deln
.

(2)

The Non-Arms Length Transaction

[4]

Between September and December 2007,
Deln
did renovations for the new location of the Just
Between
Us clothing store in Waterloo.  The trustee estimated that the fair market
    value of the work was $157,735.36.  EL04
    did not pay for the work, and the motion judge gave summary judgment in
    accordance with the trustees estimate.  The amount itself is not challenged on this appeal.

(3)

The Action and the Motion

[5]

After
Deln
went into
    bankruptcy, the Bank of Montreal obtained an order under s. 38 of the
Bankruptcy and Insolvency Act
authorizing it to bring this action as an assignee of the trustees interest.  It brought this action against EL04 and Ms.
Stolper
on its own behalf and on behalf of five other
    creditors of the bankrupt to recover the unpaid amount for the
    renovations.

[6]

In their defence, EL04 and Ms.
Stolper
asserted an off-set agreement between EL04 and
Deln
:  the renovation
    work performed by
Deln
would be off-set by marketing
    and consulting services provided to
Deln
by Pink
    Elephant.  In support of this agreement,
Deln
produced two credit notes it had issued to Just
Between
Us.  The first
    credit note for $49,076.03 was issued on July 22, 2008, just two months before
Deln
made an assignment in bankruptcy.  The second credit note for $74,290.80 was
    issued on September 8, 2008, just two weeks before the assignment. The second
    note stated that it was in lieu of consulting services provided over the last
    18 months.

[7]

In addition to the defence of an off-set
    agreement, Ms.
Stolper
maintained that she was not
    personally liable for a debt incurred by her company.

[8]

The motion judge rejected the defences put
    forward by EL04 and Ms.
Stolper
and held them both
    liable.  He found that EL04 had not
    provided consulting services to
Deln
, and even if it
    had, there was no off-set agreement.  He
    wrote at paras. 15 and 17 of his reasons:

Deln
gave to EL04 credits though JBU
    in the three months before the bankruptcy of
Deln
, on
    September 24, 2008, of $123,366.23.  This
    was allegedly for services provided by EL04 to
Deln
through Pink Elephant for marketing and consulting work between February 2007
    and January 2008.  They were allegedly provided
    pursuant to an agreement that they would be off set against the amount owing by
    EL04 to
Deln
for construction work that
Deln
had done for JBU by constructing renovations for JBU. There
    is no corroborating evidence that the services were provided or of the alleged
    set off agreement.  The defendants have
    provided no affidavits from Herman or Jason.  The evidence is that Elizabeth is on good terms with both. It would have
    been a simple matter for her to obtain affidavits from them confirming her
    evidence if it is true.

Elizabeth has failed, if she could, to put her best foot
    forward or to lead trump.  The principles
    set out in
1061590 Ontario Ltd.
,
Pizza
Pizza
and
Healy

apply
.  I find that the Bank has established that
Deln
provided services to EL04 in doing renovations for
    JBUs store.  I find that Elizabeth has
    failed to establish that she did any marketing and consulting work for
Deln
and if she did, that there was an agreement between
    her father, on behalf of
Deln
and her, on behalf of
    EL04 that her work would be set off against the renovations done by
Deln
.

[9]

The motion judge also found that Ms.
Stolper
was privy to the transaction between EL04 and
Deln
and, therefore, liable to the Bank for the amount of
    the claim.  As well as granting judgment
    for that amount, he granted a declaration that the two credit notes were void.

[10]

Only Ms.
Stolper
(and
    not the corporate defendant) has appealed the summary judgment.

C.

analysis

[11]

Under the former s. 100 of the
Bankruptcy and Insolvency Act
,
    which governs this appeal,
[1]
the
    trustee could assert a claim against the defendant in respect of a reviewable
    (or non-arms length) transaction for conspicuously less than fair market
    value.  Sections 100(1) and (2) provided:

(1)

Where a bankrupt sold, purchased, leased, hired,
    supplied or received property or services in a reviewable transaction within
    the period beginning on the day that is one year before the date of the initial
    bankruptcy event and ending on the date of the bankruptcy, both dates included,
    the court may, on the application of the trustee, inquire into whether the
    bankrupt gave or received, as the case may be, fair market value in consideration
    for the property or services concerned in the transaction.

(2)

Where the court in proceedings under this
    section finds that the consideration given or received by the bankrupt in the
    reviewable transaction was conspicuously greater or less than the fair market
    value of the property or services concerned in the transaction, the court may
    give judgment to the trustee against the other party to the transaction,
    against any other person being privy to the transaction with the bankrupt or
    against all those persons for the difference between the actual consideration
    given or received by the bankrupt and the fair market value, as determined by
    the court, of the property or services concerned in the transaction.

[12]

Thus to succeed in its claim against Ms.
Stolper
, the Bank (as assignee of the trustees interest)
    had to establish four elements:

·

The transaction or transactions between EL04 and
Deln
were reviewable;

·

The transactions occurred within 12 months of
Delns
bankruptcy;

·

The consideration received by the bankrupt,
Deln
, was conspicuously less than the fair market value of
    the services it provided; and

·

Ms.
Stolper
was privy
    to the transactions.

[13]

Even if all four elements were made out, the
    court still retained the discretion to refuse to grant judgment: see
Standard
Trustco
Ltd. (Trustee of) v. Standard Trust Co.
(1995)
,
    26 O.R. (3d) 1 (C.A.); and
Peoples
    Department Store Inc. (Trustee of) v. Wise
, 2004 SCC 68, [2004] 3
    S.C.R. 461.

[14]

Ms.
Stolper
does not
    contest the first two elements of the Banks cause of action.  She does challenge the last two
    elements.  Although I will review the
    facts relevant to all four, this appeal turns on the last element - whether Ms.
Stolper
was privy to the transaction between her
    company, EL04, and
Deln
.

(1)

Reviewable Transactions?

[15]

Whether the renovations performed by
Deln
alone, or the renovations and the two credit notes,
    constitute the transactions, all are reviewable under the Act.  Under the former s. 3(1) of the Act, non-arms
    length transactions were deemed to be reviewable.  Persons related to each other by blood or
marriage were
deemed not to deal with each other at arms
    length; related persons included two entities, each controlled by a related
    person.  Thus, Ms.
Stolpers
company, EL04, and her fathers company,
Deln
, were
    related persons and deemed not to deal with each other at arms length.  Their transactions were reviewable under s.
    100.

(2)

Transactions
Within
12
    Months of Bankruptcy?

[16]

The renovation work was performed from September
    to December 2007, within 12 months of
Delns
bankruptcy in September 2008.  The credit
    notes were issued a few months and a few weeks before the bankruptcy.  This element was therefore met.

(3)

Considerations Conspicuously
    Less than the Fair Market Value of the Services?

[17]

EL04 did not pay for the renovation work.  Nonetheless, Ms.
Stolper
submits that whether there was an off-set agreement for Pink Elephants
    consulting services raises an issue for trial.  She contends that the two credit notes issued by
Deln
support her submission.

[18]

The motion judge rejected this submission, and I
    agree with him.  As he pointed out,
    neither Ms.
Stolpers
father, Mr. Derksen, nor her
    husband, Jason
Stolper
, filed an affidavit attesting
    to any off-set agreement or to the receipt of consulting services.  Ms.
Stolper
did not
    produce any records, documents or notes supporting the existence of an off-set
    agreement.  Nor did she produce
    particulars of any consulting service she provided to
Deln
to off-set the renovation work on the Just
Between
Us
    store.  The motion judge was therefore entitled
    to conclude that no off-set agreement existed and no consulting services were
    provided.

[19]

Accordingly, Deln did the renovation work
    without remuneration or for conspicuously less than its fair market value.

(4)

Was Ms.
Stolper
Privy to
    the Transactions?

[20]

The motion judge did not find that Ms.
Stolper
had been fraudulent, deceitful or dishonest.  Thus, she argues that the motion judge had no
    basis to, in effect, pierce the corporate veil, and hold her personally liable
    for the debt of her company.  I do not
    accept this argument.

[21]

The traditional and well established bases for
    piercing the corporate veil do not apply to those persons who might be liable
    as privy under s. 100.  The purpose of s.
    100 is to preserve the bankrupts assets for its creditors by allowing the
    trustee to recover economic losses suffered by the bankrupt in non-arms length
    transactions: see
Standard
Trustco
,
at p. 11. In the light of this
    purpose, the courts have interpreted the term privy to include those persons who
    have knowledge of a transaction for less than fair market value and benefit
    either directly or indirectly from it: see Peoples, at para. 91.

[22]

In
Peoples
,
    the Supreme Court of Canada set out the purpose of s. 100 and explained why it required
    a broad definition of the term privy.  Major and
Deschamps
JJ.
wrote
at para. 91:

The primary purpose of s. 100 of the BIA is to reverse the
    effects of a transaction that stripped value from the estate of a bankrupt
    person.  It makes sense to adopt a more
    inclusive understanding of the word privy to prevent someone who might
    receive indirect benefits to the detriment of a bankrupts unsatisfied
    creditors from frustrating the provisions remedial purpose.  The word privy should be given a broad
    reading to include those who benefit directly or indirectly from and have
    knowledge of a transaction occurring for less than fair market value.  In our opinion, this rationale is
    particularly apt when those who benefit are the controlling minds behind the
    transaction.

[23]

The courts broad interpretation of privy,
    gleaned from the purpose of s. 100, has effectively created an exception to the
    well established principles of separate corporate personality. The term privy
    is broad enough to include, in appropriate cases, individuals who are the sole
    principals of corporate defendants.

[24]

Given the broad meaning of privy, the motion
    judge was correct to conclude that Ms.
Stolper
was
    privy to the transaction or transactions between her company, EL04, and
Deln
.  Even if she
    did not know about the credit notes, as she claims, she did know about the
    renovations on the clothing store.  Her
    company received the benefit of those substantial renovations and did not pay
    for them.  The company could then use the
    money for other purposes.

[25]

Ms.
Stolper
was the
    sole principal of EL04.  She was the
    controlling mind behind the arrangement with
Deln
to
    renovate the Just
Between
Us store.  At a minimum, she benefited indirectly, if
    not directly, from her companys failure to pay
Deln
for the renovations.  She was, in short,
    privy to the transaction.

[26]

The Bank, therefore, has established all four
    elements of a successful claim under s. 100.  The only remaining question is whether the court ought to exercise its
    discretion not to grant judgment against Ms.
Stolper
.  Major and
Deschamps
JJ.
described
this discretion at para. 92 of Peoples:

A finding that a person was privy to a reviewable transaction
    does not of course necessarily mean that the court will exercise its discretion
    to make a remedial order against that person.  For liability to be imposed, it must be established that the transaction
    occurred:  (a) within the past year; (b)
    for consideration conspicuously greater or less than fair market value; (c)
    with the persons knowledge; and (d) in a way that directly or indirectly
    benefited the person.
In addition,
    after having considered the context and all the above factors, the judge must
    conclude that the case is a proper one for holding the person liable.
In light of these conditions and of the
    discretion exercised by the judge, we find that a broad reading of privy is
    appropriate. [Emphasis added.]

[27]

The motion judge concluded that this was a
    proper case for holding Ms.
Stolper
liable.  I see no basis to interfere with his
    conclusion.  I would, therefore, dismiss
    Ms.
Stolpers
appeal.

[28]

In doing so, I emphasize the rather narrow
    limits of these reasons.  They should not
    be taken to hold that in every case of a non-arms length transaction at less
    than fair market value between a bankrupt and a company owned by a single
    person, that that person is automatically privy.  These cases tend to be fact specific and
    should be decided as they arise.  Moreover, even where a sole shareholder or principal is found to be
    privy, considerations may exist that persuade a court to exercise its
    discretion not to grant judgment against that person.

D.

the cross-appeal on costs

[29]

The motion judge awarded the Bank partial
    indemnity costs in the amount of $13,131.30.  The Bank seeks leave to appeal his costs award and asks for substantial
    indemnity costs of approximately $25,000.

[30]

I see no merit in the cross-appeal.  The motion judge considered and rejected the
    Banks request for substantial indemnity costs.  He said at para. 1:

I do not think that substantial indemnity costs are
    warranted.  In my view, the conduct of
    the defendants does not rise to the level of reprehensible conduct, either in
    the circumstances giving rise to the cause of action, or in the proceedings,
    which makes such costs desirable as a form of chastisement. [Citation
    omitted.]

I see no basis to interfere with this finding.  I would deny leave to appeal costs.

E.

conclusion

[31]

I would dismiss the appeal.  I would also dismiss the cross-appeal on
    costs by denying leave to appeal.  Taking
    into account the divided success, I would award the Bank costs of $6,000,
    inclusive of disbursements and applicable taxes, for the proceedings in this
    court.

Released: Feb. 7, 2012                                          John
    Laskin J.A.

JL                                                                     I
    agree Robert J. Sharpe J.A.

I
    agree R.G.
Juriansz
J.A.

[1]
Section
    100 has now been repealed and replaced by s. 96.


COURT OF APPEAL FOR ONTARIO

CITATION:
Bank
    of Montreal v. Ismail, 2012 ONCA 129

DATE: 20120228

DOCKET: C54380

Lang, LaForme JJ.A. and Pattillo J. (
ad hoc
)

BETWEEN

Bank of Montreal

Plaintiff (Appellant)

and

Fawzia Ismail and Khalid Ismail

Defendants (Respondents)

Joshua J. Siegel, for the appellant

Darren J. Smith, for the respondents

Heard: February 16, 2012

On appeal from the order of Justice Gisele M. Miller of
    the Superior Court of Justice, dated August 31, 2011.

By the
    Court:

OVERVIEW

[1]

The Bank of Montreal appeals from the order of the motion judge
    enforcing a settlement that she concluded the parties had reached under rule
    49.09 of the
Rules of Civil Procedure
.

[2]

The motion judge decided that the settlement included a provision that the
    respondents, Fawzia Ismail and Khalid Ismail, would pay the Bank $357,000 on
    account of the approximately $390,000 owing on their outstanding mortgage. In
    reaching her decision that the Bank had agreed to this reduction in the debt
    owing, the motion judge primarily relied on two pieces of correspondence
    between the parties counsel  the Banks April 8 letter and the respondents
    April 19 letter.

[3]

In our view, the motion judge made a reversible error of interpretation
    when she relied primarily on these two pieces of correspondence without taking
    into consideration the earlier correspondence that was incorporated by
    reference.  A review of the whole of the correspondence establishes that the
    parties did not reach an agreement on the essential term of the amount required
    to payout the mortgage.

[4]

In light of this error, we would allow the appeal, set aside the order
    of the motion judge, and dismiss the respondents motion.

DISCUSSION

[5]

In her endorsement, the motion judge set out the undisputed test to be
    applied on a motion under rule 49.09: (1) was an agreement to settle reached;
    and, (2)  if so, should it be enforced based on all the evidence:
Milios v.
    Zagas
(1998), 38 O.R. (3d) 218 (C.A.)

[6]

The Banks primary argument on appeal is that the motion judge made a
    reviewable error in concluding that the correspondence between the parties
    counsel was sufficient to establish an accepted settlement. The Bank further
    submits that the motion judge erred in failing to exercise her discretion not to
    enforce the settlement. The respondents argue that the motion judge was
    entitled to rely on the two pieces of correspondence to conclude that the
    parties had reached a meeting of the minds on the essential term of the amount
    of the mortgage payout.

[7]

The motion judge considered the Banks April 8 letter and determined
    that its contents did not constitute an offer to settle. However, she
    concluded that the respondents April 19 letter set out clear, unequivocal
    terms of settlement, including payment of $357,000, which were accepted by the
    Bank by its letter of April 26.

[8]

However, this correspondence formed only part of a series of letters
    exchanged between counsel as a result of their litigation.  That litigation
    included the Banks June 2010 action against the respondents for monies due
    under the mortgage.  At the end of June, the Bank also obtained default
    judgment against the respondents and filed a writ of seizure and sale in
    relation to the respondents separate unsecured debt that they also owed to the
    Bank.

[9]

Settlement discussions commenced.  The correspondence as a whole
    demonstrates that the primary focus of the discussion concerned payment terms and
    security for the amount owed on the default judgment.  The secondary focus was
    the issue of the payout of the respondents mortgage and the terms of its
    refinancing. The negotiations began with a discussion of whether the
    respondents would pay $1,000 or $500 monthly towards the default judgment. The
    payout amount for the mortgage was not part of that discussion.

[10]

It
    is in this context that the respondents April 19 letter must be read. However,
    the first sentence of the letter states: Further to your last correspondence,
    I confirm that I have instructions to agree to those terms proposed.  In other
    words, the respondents were agreeing to the Banks earlier terms.  The letter
    then advanced terms to be included in minutes of settlement, including a
    mortgage refinancing of $357,000 with pay-out by May 16.  While this is the
    letter that the motion judge found to be clear and unequivocal, given its plain
    wording the letter must be read with reference to the earlier terms proposed.

[11]

The
    earlier correspondence goes back to the March 10 letter on behalf of the
    respondents confirming resolution of the issue of the payment terms for the
    default judgment. It goes on to state that the settlement will allow for the
    writs of execution [in relation to the default judgment] to be removed on a
    temporary basis to allow our clients to refinance the mortgage in order to pay
    out [the Bank].  To that end, the respondents sought a payment amount for
    the mortgage in order to obtain their refinancing.

[12]

The
    Bank responded on March 22. After addressing terms concerning payment of the
    default judgment, it required that the refinanced mortgage be in an amount no
    greater th[a]n the principal now outstanding on my client[]s mortgage, so that
    my clients writ [of seizure and sale] shall only be subject to that amount.
    The letter also referred to payout of the Banks mortgage, as a separate matter.
    The payout was not tied to the amount of the refinanced mortgage. Finally, the
    Bank required that the mortgage be paid out within 30 days.

[13]

In
    response on March 29, the respondents took issue with the Banks restriction of
    30 days to accomplish the refinancing and advised that if the Bank insisted on
    that time limit, there would be no settlement. The respondents again requested
    a payout amount for the mortgage. On March 31, the Bank provided a letter
    showing the amount owing on the mortgage as at that date was $356,885.47 for
    principal, $29,040.31 for interest and $4,679.50 for tax account debit for a
    total amount of $390,605.28. In addition, the letter set out approximate legal
    fees for the Banks solicitors of $8,971.57.

[14]

When
    the respondents replied on April 4, they only took issue with the approximately
    $9,000 for legal fees and said there had been no agreement on that issue. The
    respondents otherwise took no issue with the amount of $390,000 required for
    the payout of the mortgage. There certainly was no suggestion of a $357,000
    payout. Besides the amount of the legal fees, the only other contentious issue was
    the proposed extension of the refinancing period from 30 to 60 days.

[15]

On
    April 8, the Bank wrote to the respondents counsel referencing the earlier
    March 10 letter and specifying a refinancing date of May 16, 2011 failing
    which this settlement is null and void. The Bank was offering no concession on
    this or any other point. The April 8 letter again mentioned a refinancing of
    $357,000, but that reference was in connection with the amount it was prepared
    to allow the respondents to refinance in priority to the unsecured debt.

[16]

It
    is with that background that the respondents wrote the letter of April 19. As
    noted, that letter agreed to the Banks terms, which in earlier correspondence
    clearly included a payout of at least $390,000. While the respondents April 19
    letter set out terms to be included in the Minutes Settlement, it did not
    provide draft Minutes of Settlement or specify a payout figure for the
    mortgage. What the letter did do on page 2 was add a sentence asking the Bank
    to advise if these terms do not properly reflect the contents of your latest
    correspondence and my previous letter.  It is worth repeating that the terms
    in the April 19 letter specifically referenced the respondents acceptance of
    the terms proposed by the Bank.

[17]

In
    no correspondence, or any other communication between the parties, was there
    any discussion or agreement to a payout figure other than the approximate
    amount of $390,000 and arguably the proposed legal fees.

[18]

The
    determination of whether a settlement was reached in this case did not require
    an inquiry into the parties subjective intentions. Since the correspondence
    was in writing, the issue could be determined based on an objective reading of
    the contents:
Olivieri v. Sherman
, 2007 ONCA 491, 86 O.R. (3d) 778 (C.A)
    at para. 44.

[19]

In
    any interpretation exercise, the supporting documentation must be read in
    context. In this case, the motion judge erred in focusing on particular letters
    without considering them in the context of the history of the correspondence,
    particularly the correspondence to which they specifically referred.

[20]

When
    the correspondence between the parties solicitors is considered in context,
    there was no agreement on the amount of the payout of the mortgage. The parties
    were at cross purposes on that issue.  There was no settlement.

[21]

In
    view of this conclusion, it is unnecessary to deal with the Banks secondary
    argument that the motion judge also erred in failing to exercise her discretion
    to refuse to enforce the settlement.

RESULT

[22]

Accordingly,
    the appeal is allowed, the order below is set aside, and the respondents
    motion is dismissed.

[23]

Finally,
    the costs awarded to the respondents by the motion judge are set aside and
    costs of the motion in the agreed-upon amount of $2,300 are awarded to the
    Bank. As well, costs of the appeal are awarded to the Bank, fixed in the amount
    of $7,500, inclusive of disbursements and applicable taxes.

Released: Feb. 28, 2012                               S.E.
    Lang J.A.

SEL                                                                  H.S.
    LaForme J.A.

L.A.
    Pattillo J. (ad hoc)


COURT OF APPEAL FOR ONTARIO

CITATION:
Bolohan v. Hull, 2012
    ONCA 121

DATE: 20120222

DOCKET: C53947

Sharpe, Armstrong and Watt JJ.A.

BETWEEN

Denise Bolohan

Plaintiff (Appellant)

and

Judith Hull

Defendant (Respondent)

William G. Scott, for the appellant

Mark D. Contini, for the respondent

Heard: February 7, 2012

On appeal from the order of Justice K.A. Gorman of the Superior
    Court of Justice, dated June 3, 2011.

ENDORSEMENT

[1]

The appellant, the plaintiff in a wrongful dismissal action, appeals the
    decision of a Superior Court Judge (the appeal judge), allowing an appeal
    from an order of a Master made at a rule 48.14 status hearing, and dismissing her
    action for delay.

[2]

The appellant and the respondent are both lawyers. The appellant was
    formerly employed by the respondent. She was terminated in October 2006 and
    brought this action claiming damages for wrongful dismissal.

[3]

Although one of the issues on this appeal is the state of the record before
    the Master, at the end of the day, the essential facts do not appear to be in
    dispute. These may be gleaned from the reasons of the Master and the fresh
    evidence filed and admitted on this appeal.

[4]

The steps taken in the action may be summarized as follows:

·

September 18, 2008  Notice of Action filed

·

October 17, 2008  State of Claim delivered

·

November 6, 2008  Notice of Intent to Defend filed

·

November 27, 2008  Statement of Defence delivered

·

Respondent served Offer to Settle. Appellant did not respond and
    the offer was withdrawn.

·

Court assigned a settlement conference date of November 24, 2010
    (action came under Case Management pursuant to Rule 77).

·

Mediation session date to be scheduled for no later than November
    24, 2009

·

March 27, 2009  Appellants counsel attempted to schedule the
    mediation

·

May 11, 2009  Respondents counsel responded by letter opposing the
    appointment of the proposed Roster Mediator and suggesting a non-Roster
    Mediator. Appellants counsel did not reply to this letter

·

November 18, 2010  Court issued a Status Notice

·

February 9, 2011  Appellant requested that the Court schedule a status
    hearing

·

April 4, 2011  Status hearing held before the Master.

[5]

Before the status hearing, counsel for the respondent wrote to counsel
    for the appellant advising that he would be asking the Master to dismiss the
    action for delay. Counsel for the appellant replied that he would address the
    issue at the status hearing and proposed a timetable in order to move the
    matter forward. Counsel for the respondent rejected the timetable proposed by
    the appellant.

[6]

On the basis of the oral representations made at the status hearing, the
    Master concluded that although it appeared that the plaintiff had no
    explanation for a delay of some 22 months, the defendant had sat idly waiting
    for the case to come up. The Master noted that the defendant herself had failed
    to comply with the rules, presumably a reference to the fact that the
    respondent had failed to file her affidavit of documents. The Master concluded
    that the respondents request that the action be dismissed for delay should be
    denied. Pursuant to her discretion under rule 48.14 (13), the Master prescribed
    a detailed timetable and discovery plan for the completion of the action.

[7]

As we read her reasons, the appeal judge allowed the appeal from the
    Master on the ground that the appellant failed to satisfy her onus under the
    rule 48.14 because she failed to file affidavit evidence.

[8]

In our view, the Superior Court judge erred in so holding. The usual
    practice is for the initial status hearing to proceed on the basis of oral
    submissions. If the judicial officer conducting the status hearing forms the
    view, on the basis of the oral submissions, that the action is vulnerable
    dismissal for delay, ordinarily a full hearing will be ordered on affidavit
    evidence: see
Oberding v. Sun Life Financial Assurance Co. of Canada
2010 ONSC 3303, 267 O.A.C. 120 (Div. Ct.), at para. 25;
Koepcke v. Webster
,
    2012 ONSC 357 (Master), at para. 13.

[9]

We note as well that counsel for the respondent made no objection to the
    appellant's counsel outlining the facts by way of oral submissions.

[10]

In
    these circumstances, it is our view that counsel for the appellant was entitled
    to proceed before the Master at the initial status hearing without affidavit
    evidence. The appeal judge therefore erred in finding that the appellant had
    failed to meet the onus imposed by rule 48.14 to explain the delay simply because
    no affidavits were filed.

[11]

This
    leads us to conclude that the appeal judges order must be set aside.

[12]

Ordinarily,
    this would leave us with the decision of the Master, which would attract
    deference. In our view, however, the Master misstated the proper legal test to
    be applied at a rule 48.14 status hearing. At two points in her endorsement,
    the Master stated that the test to be applied is the same as on a motion to
    dismiss for delay under Rule 24. That rule imposes a burden on the defendant to
    show why the action should be dismissed and makes it a condition to a
    defendants request to have the action dismissed for delay that the defendant
    not be in default under the rules. It was conceded in argument before us that
    Rule 24 has no application to a rule 48.14 status hearing.

[13]

At
    another point in her endorsement, however, the Master stated the proper test: the
    plaintiff bears the burden of demonstrating that there is an acceptable
    explanation for litigation delay and that, if the action is allowed to proceed,
    the defendant will suffer no non-compensable prejudice:
Oberding v. Sun
    Life Financial Assurance Co. of Canada
, at para 15; see also
Kahn v.
    Sun Life Assurance Company of Canada
2011 ONCA 650 at para 1. However, it
    is not clear to us that, in the end, the Master applied the correct test.

[14]

In
    these circumstances we could remit the matter to the Superior Court for another
    status hearing. We are, however, satisfied that the relevant, undisputed facts
    before us are sufficient to make our determination and that to do so is in the
    interests of justice.

[15]

Although
    we regard this case as a very close call, we are of the view that the action
    should be permitted to proceed according to the timetable set out by the
    Master, with the dates adjusted to the release date of these reasons.

[16]

The
    appellants failure to move this action forward in a timely manner is
    troubling. On the other hand, we do not agree with the respondent that there
    was an unexplained delay of 22 months. The appellant attempted to schedule a
    mediation four months after the statement of defence was filed, but was met with
    the respondents insistence of a non-roster mediator. Counsel for the appellant
    assumed that the court would automatically assign a roster mediator, in
    accordance with what he believed to be the usual practice. That did not occur.
    The delay from the appellant's attempt to schedule the mediation to the
    Court-served status notice was almost eight months. Three months later, the
    appellant asked the court to schedule a status hearing. Prior to the status
    hearing, the appellant proposed a timetable that would have set the matter down
    for trial by the end of 2011.

[17]

Although
    the appellant failed to prosecute this action in an appropriate fashion, the question
    is whether the delay has been sufficiently explained so as to allow the action
    to proceed. While the focus of the inquiry on a rule 48.14 status hearing is
    the plaintiffs conduct, the conduct of the respondent in the litigation can
    still have bearing on our assessment of the reason for the delay and on how we
    the exercise the discretion conferred by rule 48.13. The respondent may have
    been strictly entitled to insist on a non-roster mediator. That would, however,
    involve more expense and is hardly a tactic consistent with a willingness to
    see a relatively straightforward case proceed expeditiously. The respondent
    also failed to file her affidavit of documents despite the fact that virtually
    all of the relevant documents would be in the respondents possession. Although
    the respondents conduct  is not fatal to a request to have the action
    dismissed as a status hearing, it demonstrates that the delay was not
    exclusively attributable the appellant, as she did take some steps to move the
    action forward but faced some resistance on the part of the respondent.

[18]

For
    these reasons, the appeal is allowed and the order of the appeal judge is set
    aside. In its place, an order based upon para. 21 of the Masters endorsement,
    adjusted as indicated in these reasons, shall issue. Costs to the appellant in
    the agreed sum of $7,500 inclusive of disbursements and HST.

Robert J. Sharpe J.A.

R.P. Armstrong J.A.

David Watt J.A.


COURT OF APPEAL FOR ONTARIO

CITATION:
Chasczewski v. 528089
    Ontario Inc.

(Whitby Ambulance Service), 2012 ONCA 97

DATE: 20120213

DOCKET: C53915

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

BETWEEN

John
    E. Chasczewski, Executor of the Estate of Millie Chasczewski, Deceased, John E.
    Chasczewski, Tod Chasczewski and Gary Chasczewski

Plaintiffs (Appellants)

and

528089
    Ontario Inc., operating as Whitby Ambulance Service,

William
    Cocker, F. Webster and R. Werner

Defendants (Respondents)

Allan Rouben and Amani Oakley, for the appellants

Deborah Berlach and Renée A. Kopp, for the respondents

Heard: December 16, 2011

On appeal from the judgment of Justice Mark L. Edwards of
    the Superior Court of Justice, dated May 26, 2011 with reasons reported at 2011
    ONSC 999.

Laskin
J.A.:

A.

overview

[1]

The plaintiffs appeal the summary judgment dismissing their action for
    medical malpractice.

[2]

On December 22, 1996, Frank Webster and Robert Werner, two paramedics
    with the Whitby Ambulance Service, responded to a 9-1-1 call at the home of Mr.
    and Mrs. John and Millie Chasczewski.  They were told that a woman (Mrs.
    Chasczewski) was choking and was unresponsive.

[3]

Webster and Werner arrived at the Chasczewskis home promptly, but
    remained there for at least 12 minutes before transporting Mrs. Chasczewski to
    the emergency department of the local Whitby hospital.  Sadly, she went into
    cardiac arrest while in the back of the ambulance, could not be revived, and
    was pronounced dead at the hospital.

[4]

The Chasczewski family sued the two paramedics, the ambulance service
    and its owner, William Cocker, for negligence.  They alleged that the
    paramedics ought to have transported Mrs. Chasczewski to the hospital sooner.
    Had they done so, Mrs. Chasczewski could have been treated at the hospital
    while she still had a heart beat and would likely have survived.

[5]

The defendants brought a motion for summary judgment to dismiss the
    claim.  Edwards J. granted the motion.  He held that whether the defendants met
    the standard of care was a genuine issue requiring a trial.  However, he also
    held that even if the defendants breached the standard of care required of
    them, their breach did not cause Mrs. Chasczewskis death because she would
    have died anyway.

[6]

In holding that the issue of causation did not require a trial, the
    motion judge relied on the opinion of the defendants expert who said the
    survival rate for a person with a complete heart block who suffers a pre-cardiac
    or cardiac arrest outside the hospital was only 2.4 per cent.  The plaintiffs
    filed no response to this opinion.  The motion judge concluded that their
    failure to do so was determinative of this motion.

[7]

The Chasczewski familys main argument on appeal is that the motion
    judge erred in relying on the opinion of the defendants expert and in holding
    that the plaintiffs had an onus to respond to it. They submit that the opinion of
    the defendants expert did not address the plaintiffs theory of the case.  I
    agree with this submission.  A full appreciation of the evidence on the issue
    of causation requires a trial.  I would set aside the motion judges order and
    dismiss the motion for summary judgment.

B.

the record

[8]

The record before the motion judge was substantial.  It included medical
    reports and the affidavit of John Chasczewski, who was a firefighter and
    administered partial CPR to his wife before the paramedics arrived.

[9]

The record also included three affidavits from experts, two filed by the
    plaintiffs and one by the defendants.  The plaintiffs filed the affidavits of
    Dr. Steven Shilling, a cardiologist from Irving, Texas, with 17 years
    experience, and the affidavit of Alex Stadthagen, a paramedic and paramedic
    instructor also from Irving, Texas, with nearly 30 years experience.  Each
    appended to his affidavit an expert report prepared in 2004.

[10]

The
    defendants filed the affidavit of Dr. Douglas Munkley, a medical doctor
    specializing in emergency medicine, and, since 1986, the medical director of
    the base hospital paramedic program for the Niagara Region.  Dr. Munkley
    appended to his affidavit two reports, one prepared in August 2007, and the
    second, a supplementary report prepared in April 2008.  It was the
    supplementary report that the motion judge relied on to grant summary
    judgment.

[11]

None of
    the experts was cross-examined on his affidavit.  And neither of the two
    paramedics, Webster and Werner, filed affidavits on the motion.

C.

the standard of care

[12]

In this
    case, as in most medical malpractice actions, the two main issues are standard
    of care and causation: did the defendants fall below the standard of care
    required of them; and if they did, did their failure to meet the standard of
    care cause Mrs. Chasczewskis death?

[13]

The motion
    judge was presented with competing expert opinions on the standard of care, one
    from Mr. Stadthagen, who said that the paramedics breached the standard of
    care, and the other from Dr. Munkley, who said that they had met the standard.
    Faced with these contradictory opinions, neither of which was challenged on
    cross-examination, the motion judge sensibly concluded that whether the
    defendants met the standard of care was a genuine issue requiring a trial.

[14]

The motion
    judge did not, however, set out the plaintiffs theory on how Webster and
    Werner breached the standard of care.  His failure to do so likely contributed
    to his error in addressing the issue of causation.

[15]

The
    question whether the standard of care was met should be decided before the
    question of factual causation: see
Bafaro v. Dowd
, 2010 ONCA 188, 260
    O.A.C. 70; and
Randall v. Lakeridge Health
, 2010 ONCA 537, 270 O.A.C.
    371. It must be resolved first for two reasons. First, without a finding that
    the defendant has breached the standard of care, the question of causation
    becomes moot. Second, and more important for this case, it is the defendants
    particular substandard act or omission that must be shown to have caused the
    harm; therefore, it is necessary to identify that act or omission to determine
    what, if any, connection it has to the harm at issue. In other words, causation
    can only be assessed in the context of a breach of the standard of care.

[16]

Because
    this was a summary judgment motion, the motion judge did not have to resolve
    whether the defendants breached the standard of care - indeed he correctly
    found that he could not do so on the record before him. However, he had to
    assume that the defendants breached the standard of care in the manner alleged
    by the plaintiffs, in order to decide whether causation was also a genuine
    issue requiring a trial.

(a)

The Timeline

[17]

To
    properly assess whether causation raised an issue for trial, I will set out the
    basis for the plaintiffs claim that Webster and Werner breached the standard
    of care.  Important to this assessment is the timeline for what the paramedics
    did in relation to Mrs. Chasczewskis cardiac activity.  As counsel for the
    plaintiffs aptly observed, this was a case in which minutes, if not seconds,
    were critical to Mrs. Chasczewskis chances of survival.

[18]

The motion
    judge set out at para. 4 of his reasons the following timeline of events:

Call received 12:53:22

Crew notified 12:53:36

En route to call 12:53:36

Arrived scene 12:55:48

Depart scene 13:13:32

Arrived hospital 13:17:10

[19]

From this
    timeline, he found that the paramedics remained on scene at the Chasczewski
    residence for just under eighteen minutes: see para. 5. However, because he did
    not deal with the plaintiffs theory on the alleged breach of the standard of
    care, he did not examine the timing of these events in relation to Mrs.
    Chasczewskis condition.

[20]

Based on
    the record, a timeline including this vital information is as follows:

12:53:22      911 call received

12:53:36      Webster
    and Werner leave for the Chasczewski residence

12:55:48      Webster
    and Werner arrive at the Chasczewski residence

12:56:59      Mrs.
    Chasczewski has a decreased level of consciousness and low cardiac activity,
    with a pulse rate of 8 to 10 beats per minute

13:01:02      Mrs.
    Chasczewskis heart rate is 36 beats per minute

13:07:00      Mrs. Chasczewskis cardiac activity stops

13:11:06      Mrs.
    Chasczewski suffers a cardiac arrest while in the ambulance

13:13:32      The
    ambulance crew calls into dispatch to say that they have left the scene

13:17:10      The
    ambulance arrives at the Whitby hospital emergency department; Mrs. Chasczewski
    cannot be revived and is pronounced dead

[21]

The
    evidence on what happened between 12:53 (when the paramedics arrived at the
    Chasczewski residence) and 13:07 (when Mrs. Chasczewskis cardiac activity stopped)
    is consistent throughout the record.

[22]

Where
    discrepancies do exist is in the period between 13:07 and 13:17.  Perhaps the
    most important discrepancy concerns how long the paramedics remained at the
    Chasczewski residence.  The motion judge found that they stayed there for
    nearly 18 minutes.  A Ministry of Health investigation report estimated that
    the paramedic crew was on scene at the Chasczewski residence for about 12
    minutes before leaving for the hospital.  Although it is not possible on this
    record to pinpoint the precise time of departure, likely, the paramedics left
    shortly before 13:13, the time found by the motion judge, and stopped at the
    side of the road to treat Mrs. Chasczewski.  She went into cardiac arrest while
    in the back of the ambulance.  And when Webster, who was driving, called in at
    13:13, the ambulance was already en route to the hospital.

[23]

These
    discrepancies may have to be sorted out at trial.  On this appeal, we can
    safely accept three facts critical to the plaintiffs case:

·

Mrs. Chasczewski had a heart rate or cardiac activity for about
    10 minutes after the paramedics arrived at the Chasczewski residence;

·

The paramedics stayed at the Chasczewski residence for at least
    12 minutes and perhaps longer;

·

It took only about four minutes to drive from the Chasczewski
    residence to the Whitby hospital.  This figure is used in the material and is
    supported by (a) the Chasczewski residence was about four to five kilometres
    from the hospital and (b) the dispatch record shows that the ambulance drove at
    an average speed of 80 kilometres per hour

(b)

The Plaintiffs Theory of How the Defendants Breached the Standard of
    Care

[24]

In a
    nutshell, the plaintiffs theory is that the paramedics were presented with a
    classic load and go situation.  Mrs. Chasczewskis low cardiac activity made
    it imperative that she be transported to the hospital immediately.  Instead,
    for reasons largely unexplained in the record because neither paramedic gave
    evidence, Webster and Werner waited at least 12 minutes before putting Mrs.
    Chasczewski in the ambulance and taking her to the hospital.

[25]

In seeking
    to demonstrate a breach of the standard of care, the plaintiffs relied on the
    opinion of Mr. Stadthagen.  Although he practises in Texas, he reviewed the
    Basic Life Support Patient Care Standards, published by the Ontario Ministry of
    Health.  This publication set out the standards expected of paramedics at the
    time of the incident.  Mr. Stadthagen gave the opinion that these standards are
    virtually identical to those used in Texas.

[26]

Appendix
    33 to the Ministrys publication deals with load and go patients.  A load
    and go patient includes one with unstable respiratory, circulatory and/or
    neurological status or in whom instability is imminent or highly likely on the basis
    of assessment findings.  The appendix lists various medical and traumatic
    conditions characteristic of load and go patients.  Condition 7 states:

Decreased level of consciousness  serious underlying disorder
    suspect or cannot be ruled out and/or no definitive field treatment is
    available.

[27]

The Ministrys
    standards stipulate that when dealing with a load and go patient, paramedics
    should first perform appropriate primary survey interventions.  This assessment
    should take approximately two minutes unless major problems are encountered. Then,
    the patient should be put in an ambulance and transported rapidly to the nearest
    hospital.

[28]

On the
    basis of the general description of a load and go patient, and particularly condition
    7, Mr. Stadthagen was able to say that Mrs. Chasczewski was such a patient.  By
    12:56:59, immediately after their arrival, the paramedics had determined that
    Mrs. Chasczewski had a decreased level of consciousness and vital signs
    consistent with low cardiac activity.  She was obviously unstable and required
    immediate treatment.  Mr. Stadhagen gave the opinion that had she been taken to
    the hospital right after the initial two-minute assessment, as required for load
    and go patients, she would have arrived at the emergency department no later
    than 13:03, that is, while she still had a heart beat.  There, she could have
    been given an external pacemaker or the drug Atropine intravenously, either of
    which may have saved her life.

[29]

Mr. Stadthagen
    recognized that these treatment options could not be given in the field (see
    condition 7) or at the scene, and therefore had to be administered at the
    hospital.  That is because Webster and Werner, as primary care paramedics
    were not trained to apply a pacemaker or administer drugs intravenously.  Only advanced
    care paramedics are trained in these skills, and Ontario did not have advanced
    care paramedics until 1998, two years after Mrs. Chasczewski died.

[30]

Mr. Stadthagens
    overall opinion was that by not treating Mrs. Chasczewski as a load and go
    patient and immediately transporting her to the nearest hospital emergency
    department, the two attending paramedics, Webster and Werner, fell below the
    required standard of care.

[31]

This
    outline of the plaintiffs theory on the standard of care provides the
    necessary context for the issue of factual causation.  However, before turning
    to that issue, I will briefly address an alternative argument on the standard
    of care put forward by the defendants.  They contend that the plaintiffs filed
    no admissible evidence on the standard of care because Mr. Stadthagen neither
    worked nor was trained in Ontario. He therefore had no direct knowledge of
    Ontario standards and could not be qualified as an expert.

[32]

This
    argument has no merit.  The bar for qualifying an expert is not high. The only
    requirement is that the expert must have acquired special or peculiar
    knowledge through study or experience in respect of the matters on which he or
    she undertakes to testify:
R. v. Mohan
, [1994] 2 S.C.R. 9, at p. 25. This
    special knowledge must go beyond that of the trier of fact: see
R. v.
    Marquard
, [1993] 4 S.C.R. 223, at p. 243;
McLean (Litigation Guardian
    of) v. Seisel
(2004), 182 O.A.C. 122, at paras. 105-106.

[33]

Mr. Stadthagen
    had the requisite knowledge and expertise regarding paramedical standards of
    care in Texas. He reviewed the Ontario standards and said under oath that they
    were nearly identical to those used in Texas, where he practises.  His
    expertise on the standard of care in Ontario went beyond that of the trier of
    fact. Moreover, he was not cross-examined on his opinion or on his
    qualifications generally.  His expert opinion was therefore admissible.  Its
    weight was a matter for the motion judge.

D.

causation

(a)

Dr. Shillings Opinion

[34]

In seeking
    to show that the defendants breach of the standard of care caused Mrs.
    Chasczewskis death, the plaintiffs relied on the expert opinion of Dr.
    Shilling.  From the medical records, Dr. Shilling noted that Mrs. Chasczewski
    did not have a heart attack, but instead had a complete heart block.  As she
    did not have any heart damage, in his opinion her condition was quite treatable
    as long as the paramedics transferred her immediately to an advanced life
    support service.  The use of an external cardiac pacemaker or the
    administration of Atropine intravenously
while Mrs. Chasczewski

still
    had a pulse
would likely have saved her life.

[35]

Dr.
    Shilling considered the timeline and emphasized that after the paramedics
    arrived at the Chasczewski residence, there was a 10 minute window when Mrs.
    Chasczewski had cardiac activity.  If she had been given Atropine or an
    external pacemaker in this window of opportunity, she likely would have
    survived.  He put it this way in the body of his report:

3.  Complete
    heart block is truly an extremely treatable condition.  An external pacemaker
    almost uniformly allows one to temporarily but adequately treat this
    disturbance if it is instituted in an appropriate amount of time.  I definitely
    feel than an external pacemaker would have allowed this patient to survive if
    instituted immediately [f]or very shortly after paramedic arrival, which
    appeared to have been at 12:56 p.m.  It is definitely more difficult to state
    whether or not she would have survived if it would have been placed at 13:07,
    but nevertheless, there is a 10 minute window at that particular time frame
    when she clearly had cardiac activity and thus, in all reasonable medical
    probability, I do feel she likely would have survived.

4.
I do feel
    that the patient would have survived if she would have

arrived with a
    pulse
and received
external cardiac pacing at the time that she did
    experience a palpable pulse.
Again, it is somewhat more difficult when
    you get out into the 13:05 to 13:06 time frame, but nevertheless, patient[]s
    can certainly be salvageable with an external pacemaker. [Emphasis added.]

[36]

In the
    concluding paragraph of his report, Dr. Shilling summed up his opinion on Mrs.
    Chasczewskis chances of survival:

Basically, this patient died from compete heart block and while
    the paramedics arrived in an extremely rapid amount of time, there is certainly
    a near 10 minute gap, in which there was an adequate window of opportunity to
    give Atropine or apply an external pacemaker.  I think that in all reasonable
    medical probability, the patient was salvageable up until the time she had no
    obvious pulse.  I do believe that the medical record supports that this was the
    case up until the 13:06 time frame.

(b)

Dr. Munkleys Response and the Motion Judges Reliance on it

[37]

In an
    attempt to respond to Dr. Shillings opinion, the defendants filed Dr.
    Munkleys supplementary report.  In that report Dr. Munkley said that Mrs.
    Chasczewskis condition was not treatable, and that even if she had been given
    a cardiac pacemaker or a drug intravenously, her chances of survival were very
    slim.  In giving this opinion, he relied on a New England Journal of Medicine
    article, which put the survival rate at 2.4 per cent.  The critical part of Dr.
    Munkleys opinion, which the motion judge relied on, is as follows:

Complete heart block in the setting of prehospital cardiac
    arrest or prearrest as treated by paramedics outside of hospital has been well
    researched.  Unfortunately, it is
not
extremely
    treatable.  The survival rate in Ontario for this condition when treated by
    Advanced Care Paramedics using IV medications and external cardiac pacing was
    found to be only 2.4% (New England Journal of Medicine 351; 7 August 2004).
    The paramedics treating Mrs. Chasczewski on December 22
nd
, 1996 were
    not trained in these skills and practiced as Primary Care Paramedics.  Even
    if they had been able to apply external pacing the chance of survival of Mrs.
    Chasczewski was very slim. [Emphasis in original.]

[38]

The motion
    judge held that the plaintiffs failure to respond to Dr. Munkleys causation
    opinion of a survival rate of 2.4 per cent was a glaring admission and fatal
    to their claim:

It is a glaring omission on the part of the plaintiffs that
    they have not addressed the opinion of Dr. Munkley as expressed in his
    affidavit on August 24, 2010, to the effect that the survival rate in the
    Province of Ontario, for someone presenting with Mrs. Chasczewskis condition
    was 2.4 percent.  This omission is particularly troubling given the fact that
    Dr. Munkley in his affidavit, specifically responded to the opinions of Dr.
    Shilling and Mr. Stadthagen.  In my opinion there was a heavy onus on the part
    of the plaintiffs to respond to Dr. Munkleys opinion.  This is especially so,
    given the fact that Dr. Shilling, in his report of June 10, 2004, specifically
    addressed the issue of causation as it related to the timelines in this
    matter.  The failure to respond to Dr. Munkleys causation opinion of a
    survival rate of 2.4 percent is, in my opinion, determinative of this motion.
    While I accept that the plaintiffs and their counsel may have experienced
    delays in responding to the defendants motion, there can be no doubt that the
    affidavit of Dr. Munkley was in the possession of plaintiffs counsel, and
    could, and should have been responded to, particularly as it relates to the
    causation issue. I infer from the fact that Dr. Shilling does not respond to
    Dr. Munkleys causation opinion that Dr. Shilling can offer no expert evidence
    to contradict Dr. Munkleys opinion: at para. 17.

(c)

The Motion Judges Error

[39]

There are
    two reasons why it was an error for the motion judge to dismiss the plaintiffs
    claim on the basis that they did not respond to Dr. Munkleys opinion.

[40]

The main
    reason is that Dr. Munkleys opinion does not address the plaintiffs theory of
    the case.  Dr. Munkleys opinion of a 2.4 per cent survival rate rests on two
    important assumptions:

·

The patient suffered a cardiac arrest or a pre-cardiac arrest
    (which Dr. Munkley did not define but I take it to mean the absence of a heart
    beat)
outside
of the hospital.

·

An external pacemaker or Atropine was administered
by
    paramedics

after
the patient went into cardiac or pre-cardiac
    arrest.

[41]

[42]

The
    plaintiffs theory on causation does not rest on either of these assumptions.
    Rather, the plaintiffs theory assumes that the defendants failed to comply
    with the standard of care as set out in Mr. Stadthagens opinion.  It assumes
    that but for that failure, Mrs. Chasczewski would have been immediately
    transferred to the hospital emergency department after the paramedics arrived at
    her residence, and therefore that she would not have suffered a cardiac or
    pre-cardiac arrest
outside
of the hospital.  She would have been
    treated at the hospital with an external pacemaker and or Atropine, and likely
    would have survived.  Indeed, on the plaintiffs theory, Mrs. Chasczewski would
    not even have been in the cohort studied in the New England Journal of Medicine
    article that yielded the figure of a 2.4 per cent survival rate.

[43]

More
    significant, Dr. Munkleys opinion does not give effect to the 10 minute window
    of opportunity on which Dr. Shilling relied.  Webster and Werner arrived at the
    Chasczewski residence at 12:55:48; Mrs. Chasczewski had a heart beat until approximately
    13:07 at which time she was presumably in pre-cardiac arrest; she went into
    cardiac arrest at 13:11.  In Dr. Shillings opinion if she had been treated
before
13:07, that is before she went in to pre-cardiac or cardiac arrest, she likely
    would have survived.

[44]

Dr.
    Shillings opinion does not rest on advanced care treatment by the paramedics,
    only that Mrs. Chasczewski be given advanced care treatment before 13:07.  If
    effect is given to Mr. Stadthagens opinion on the standard of care, Mrs.
    Chasczewski should have been at the emergency department of the Whitby hospital
    no later than 13:03.  Inferentially, once there, she could have been given
    advanced care treatment  either an external pacemaker or Atropine  in a
    hospital setting, by a doctor
-
before 13:07.

[45]

Thus, Dr.
    Munkleys opinion, and his reliance on a 2.4 per cent survival rate, does not
    respond at all to the plaintiffs theory of the case. Indeed, Dr. Munkley did
    not give any opinion on Mrs. Chasczewskis chance of survival if she had
    arrived at the hospital with a heartbeat. And he gave no opinion on her
    probability of survival had the cardiac arrest occurred at the hospital.

[46]

There is a
    second reason why the motion judge ought not to have accepted Dr. Munkleys
    opinion as determinative of the motion.  Dr. Munkleys opinion was based on a
    statistic from a study reported in an article in a scholarly journal.  Dr.
    Munkley did not even append the article to his affidavit, and therefore we do
    not know the details of the parameters or assumptions underlying the study.
    Denying the plaintiffs their day in court on the basis of a statistic in a
    single study, which is not even in the record, is unsatisfactory.

[47]

Moreover,
    the courts have cautioned against the use of statistics to decide causation in
    a given case.  Gonthier J. expressed this caution in
Laferrière v. Lawson
,
    [1991] 1 S.C.R. 541, at pp. 606-607, where he noted the difference between
    scientific and legal standards of proof and emphasized that legal causation
    need not be determined by scientific precision. A judges duty is to assess the
    evidence of causation on the whole, not to remain paralysed by statistical
    abstraction.  The motion judges reliance on the statistic used by Dr. Munkley
    is precisely the type of fixation the court warned against.

[48]

Causation
    is a very difficult issue in this case.   It is, as I have said, an issue where
    minutes, even seconds, may have mattered.  The expert evidence on the issue was
    conflicting; the evidence on the timing of key events was unclear; and the
    evidence of key witnesses was absent. On the record before him, the motion
    judge could not have had a full appreciation of the issue of causation.
    Causation is a genuine issue requiring a trial.  I would therefore set aside
    the summary judgment granted by the motion judge and dismiss the defendants
    motion.  Both the standard of care and causation are genuine issues requiring a
    trial.

E.

conclusion

[49]

This is an
    old case.  Mrs. Chasczewski died over 15 years ago.  Shortly after her death,
    Mrs. Chasczewskis family filed a complaint about the treatment she received
    both with the Ministry of Health and the Coroners Office.  The Ministry and
    the Coroner investigated the complaint, and each concluded that the care Mrs.
    Chasczewski received was appropriate.

[50]

Nonetheless,
    the Chasczewski family is entitled to a trial of their allegations against the
    defendants.  The evidence bearing on both the issues of the standard of care
    and causation cannot be fully appreciated on the record before the motion judge.
    I would allow the appeal, set aside the summary judgment granted by the motion
    judge and substitute an order dismissing the defendants motion for summary
    judgment.  The parties may make brief submissions in writing on the costs of
    the appeal and the motion within two weeks of the release of the courts
    reasons.

Released: Feb. 13, 2012                     John Laskin
    J.A.

DOC                                                      I
    agree Dennis OConnor A.C.J.O.

I
    agree E.A. Cronk J.A.


WARNING

THIS IS AN
    APPEAL UNDER THE

CHILD AND FAMILY SERVICES ACT

AND IS SUBJECT
    TO S. 45 OF THE ACT WHICH PROVIDES:

45. (7)
The court may make an order,

(a)     excluding
        a particular media representative from all or part of a hearing;

(b)     excluding
        all media representatives from all or a part of a hearing; or

(c)     prohibiting
        the publication of a report of the hearing or a specified part of the hearing,

where the court is of the opinion that the presence of the
    media representative or representatives or the publication of the report, as
    the case may be, would cause emotional harm to a child who is a witness at or a
    participant in the hearing or is the subject of the proceeding.

45.
    (8)
No person shall publish or make public
    information that has the effect of identifying a child who is a witness at or a
    participant in a hearing or the subject of a proceeding, or the childs parent
    or foster parent or a member of the childs family.

45.
    (9)
The court may make an order prohibiting
    the publication of information that has the effect of identifying a person
    charged with an offence under this Part.

COURT OF APPEAL FOR ONTARIO

CITATION:
Children's
    Aid Society of Toronto v. N.A., 2012 ONCA 128

DATE: 20120227

DOCKET: C54509

Laskin, Rosenberg and LaForme JJ.A.

BETWEEN

The Childrens Aid Society of Toronto

Respondent in the Appeal (Applicant)

and

N.A. and A.A.T.

Appellant (Respondents)

Linda Choi, for the appellant A.A.T.

A.A.T., in person

Charlotte Murray, for the respondent

Carolyn Leach, for the children

Heard: February 9, 2012

On appeal from the order of Justice Victor Paisley of the
    Superior Court of Justice, dated May 18, 2011, dismissing the appeal from the
    order of Justice Marvin A. Zuker of the Ontario Court of Justice, dated
    November 18, 2010.

By the
    Court:

BACKGROUND

[1]

The appellant mother is 36 years old; the appellant father is
    41.  Their two children are now 8 and 6 years of age.  The children have been
    under the care of the Childrens Aid Society of Toronto (the Society) since
    November 2007.  At that time, and continuing on to the present, the mother and
    father were divorced and living at separate residences
.

[2]

The Society first became involved with
    the family in August 2005.  On May 5, 2006 the Society apprehended the children
    and the father later placed the children into the Societys care on November
    12, 2007.  On that occasion the children were placed in a fost
er care
    home, which is the same home they continue to reside in
.

[3]

Throughout the 13 day trial
in the
    Ontario Court of Justice
the mother was represented by counsel who also
    represents her on this appeal.  The father has at all times represented
    himself.   On the second day of trial, the trial judge appointed the Office of
    the Childrens Lawyer to represent the children.  The mother did not attend the
    last three days of the trial
.

[4]

At trial, the Childrens lawyer supported an order placing the
    children in the care of the father subject to Society supervision on specific
    terms.  This was based on the childrens consistently expressed views and
    preferences.  In the alternative, the childrens lawyer supported an order of
    Crown wardship without access to permit the children to be adopted
.

[5]

On November 18, 2010, the trial judge
    decided that
the best interests of the children required that they be
    made crown wards without access
and placed for
    adoption.
It is to be noted that t
he children
    have not seen their parents since that order was made some 15 months ago
.

[6]

On November 24, 2010, both parents jointly
    appealed the November 18th order to the Superior Court of Justice.  For a
    variety of reasons, on May 16, 2011 their appeal was dismissed for want of
    prosecution.  While it is technically the decision to dismiss for want of
    prosecution that is being appealed to this court, all parties agreed that this
    court could consider the question of error in the original C
rown wardship order of November 18, 2010.
Putting the best interests of the children first, and
    given the need for an expeditious conclusion to these proceedings, we agreed to
    proceed in this fashion
.

[7]

Both parents seek to have the children placed in their joint
    care, with or without a supervision order.  Alternatively, they request that
    the children be placed with the father subject to Society supervision, with the
    mother to have access to the children at her home
.

[8]

The father is self-represented on this appeal, as he was at
    trial.  He has neither perfected his appeal nor filed any materials in support
    of his position.  It appears that he in effect adopts the legal arguments in
    the mothers factum and, with the assistance of an interpreter, advanced his
    position in oral argument
.

[9]

On appeal, counsel for the children takes the position that the trial
    judges decision was supported by the evidence, does not reflect any legal
    error, and is strengthened by the new evidence that was filed with the court.
    At this time, the Childrens lawyer supports the Society in seeking that the
    appeal be dismissed and that the children be made Crown wards so that they may
    be placed in a permanent adoptive home.

ISSUEs

[10]

On the
    merits of the appeal, the appellants assert that the trial judge erred in
    concluding that the children could not be adequately protected by a supervision
    order.  They argue that he misconstrued some evidence, overemphasised other
    evidence, and failed to consider a number of relevant factors in arriving at
    his decision.

[11]

And
    finally, although this was not pressed in oral argument, the appellants submit
    that the trial judge failed to sufficiently explain why the children could not
    be returned to the parents care.

DISCUSSION

[12]

The
    custody decisions of trial judges are owed considerable deference by reviewing
    courts.  A trial judges decision will, therefore, not be interfered with
    unless there is an error in principle, a failure to consider a relevant factor
    or a consideration of an irrelevant factor, or a lack of factual support for
    the judgment.

The trial judges consideration of the evidence

[13]

The
    appellants raise numerous findings of fact by the trial judge, which they say
    reveal error on his part.  For example, they point to the finding that the
    father abused the mother and that the mother absconded to Montreal with one of the children.  In each instance they say that the trial judge either overemphasised
    evidence or failed to consider other relevant evidence.

[14]

We
    disagree.  In each of the findings particularized by the appellants - both in
    oral argument and in the mothers factum - the reasons reflect that the trial
    judge was very much aware of the relevant evidence.  The evidence is both
    referenced and reviewed by the trial judge in his reasons.

[15]

The real
    issue the appellants have with the trial judges references to the evidence is
    that he did not agree with their view that it weighed in favour of returning
    the children to their care.  This does not amount to error and does not form
    any basis on which to interfere with the trial judges decision.

[16]

In any event,
when setting out his reasons for making
    the children Crown wards, the trial judge was not obliged to discuss every
    piece of evidence he considered in arriving at his ultimate findings of fact.
The entire record, including the trial judges reasons
    for decision, informs this courts decision on appeal.  Ultimately, this court
    must assess whether the trial judge
s
    decision was consistent with the best interests of the children analysis
    required by the
Child and Family Services Act
,
R.S.O.
    1990, c. C.11
.

[17]

On our
    review of the record we conclude that the trial judge fulfilled his mandate.
    Some of the more critical and compelling findings of fact made by the trial
    judge include that:

·

The parents could not provide a safe, stable and permanent plan
    for the children either jointly or separately.  It was the trial judges
    opinion that the volatile nature of their relationship, which included a
    history of domestic violence, weighed against the viability of any joint plan.

·

Each parent had demonstrated an inability to prioritize the
    children's interests above his or her own.  Neither parent had demonstrated any
    consistent ability to accept direction or support regarding the children's
    needs.

·

There was a continuing risk of harm to the children.  The
    children came into care with issues of basic neglect, including recurring
    illnesses that were not being treated effectively, an unclean house, and poor
    hygiene.   The risk of neglect continues and the children continue to be in
    need of protection.

·

The history of both parents, and in particular the mother,
    demonstrates non-compliance and conflict with authority, which reduces the
    value of any supervision order.

[18]

There was ample evidence for each of these findings and it
    was entirely open to the trial judge to decide that it was in the best
    interests of the children to be made crown wards without access.  He properly
    considered the evidence and applied the appropriate factors as required under
the
Child and Family Services Act
.

[19]

A review
    of the new evidence, which is not contested, does not alter this conclusion.
    In fact the new evidence illustrates that certainty in their future is now
    critically important to these children.  The evidence reveals that the children
    are well nourished, healthy and coping well in care.  According to the
    childrens lawyer, their most pressing immediate wish is to know what their
    future holds.

[20]

The new
    evidence also discloses that the Society is confident that the children will be
    adopted and will remain together.  Indeed, it notes that there is at least one
    family that is open to adopting both.

The sufficiency of reasons

[21]

The
    appellants submit that the trial judges reasons insufficiently explain why the
    children cannot be placed with both parents.  While this was not pressed in
    oral argument, it can nevertheless be disposed of by way of brief comment.

[22]

To succeed the appellants must show that the deficiency in the
    reasons of the trial judge has
occasioned prejudice to the
    exercise of their right to an appeal.  In this case, the reasons have not.

[23]

As already
    noted, the trial judge reviewed all of the evidence in detail in his reasons.
    He highlighted the parents volatile relationship with each other and with the
    Society, the history of domestic violence, and the multiple failed attempts to
    place the children with either parent under supervision as reasons why a
    supervision order would not protect the children in future.  The trial judges
    reasons for why the children cannot be placed in the care of either or both
    parents are sufficient.

DISPOSITION

[24]

The appeal
    of the decision of the Superior Court of Justice, dismissing the appeal for
    want of prosecution, is allowed. The appeal seeking to set aside the Ontario
    Court of Justice order of crown wardship without access, however, is dismissed.

Released:

FEB 27 2012                                    John
    Laskin J.A.

JL                                                    M.
    Rosenberg J.A.

H.S. LaForme J.A.


COURT OF APPEAL FOR ONTARIO

CITATION:

Curactive
Organic
    Skin Care Ltd. v. Ontario,
2012 ONCA 81

DATE: 20120207

DOCKET: C53873

Doherty, LaForme and Hoy JJ.A.

BETWEEN

Curactive Organic Skin
    Care Ltd.,

in
its own
    capacity and as representative of a class

Appellant

and

Her Majesty the Queen in right of Ontario, The Corporation of the City of Toronto and Toronto Transit Commission

Respondent

Proceedings under the
Class Proceedings Act, 1992

Stephen A. Edell, for the appellant,
    Curactive Organic Skin Care Ltd.

Graham Rempe, for the respondent, City of Toronto

Kathryn Chalmers and Patrick G. Duffy, for the
    respondent, Toronto Transit Commission

Heard: January 19, 2012

On appeal from the order of Justice Paul Perell of the
    Superior Court of Justice, dated April 6, 2011, with reasons reported at 2011
    ONSC 2041 (CanLII).

ENDORSEMENT

[1]

The motion judge found
that
    Curactives claim brought under the
Class Proceedings Act
, 1992
,
    S.O. 1992, c 6 was, in substance, one for injurious affection and that such
    claims fall within the exclusive jurisdiction of the Ontario Municipal Board
    (the OMB).  Because of the jurisdictional
    result, the motion judge dismissed Curatives action under Rule 21.01(3
)(
a).  Curactive
    argues in this court that the motion judge was wrong in dismissing Curatives
    action.  We disagree.

[2]

Injurious affection, is defined in s. 1 of the
Expropriations Act
, R.S.O. 1990, c. E.26.  It essentially means such reduction in the
    market value of the land, and such personal and business damages resulting from
    the construction
of the works
by a statutory
    authority.  Compensation claims for
    injurious affection under this statute are
    to be resolved either through mediation before a board of negotiation,
    or adjudication by the OMB.

[3]

Contrary to the appellants assertion, the
    courts jurisdiction can indeed be ousted in favour of an administrative
    tribunal through clear, explicit and unambiguous language in a statute
:
Canada (Attorney General) v.
    TeleZone Inc
.,
2010 SCC 62, at paras. 42-45
.  In
Curactives
    action
, the combination of the
Expropriations Act
and
Ontario Municipal Board Act
,
    R.S.O. 1990, c. O.28, s. 36, clearly confers jurisdiction over injurious
    affection claims on the OMB.

[4]

That Curactives action proceeded under the
Class Proceedings Act,
1992
,
S.O. 1992, c 6 does not alter the jurisdictional result.  As the motion judge affirmed at para. 36, t
he
Class Proceedings Act, 1992
is a procedural
    statute and does not confer substantive law jurisdiction on the courts: see
Bisaillon v. Concordia
    University
, [2006] 1 S.C.R. 666 at para. 22.

[5]

The motion judge correctly recognized that the
    substance and not the form of the pleadings governed the jurisdictional
    inquiry.  Regardless of what Curactive
    chose to call the claim, the Superior Courts jurisdiction depended on whether
    in substance Curactives allegations amounted to a claim of injurious affection.

[6]

In our view, counsel for the TTC is correct in
    contending that all of the claims made against the TTC come down to the
    allegation that the construction of the St. Clair Project took too long and
    unreasonably impacted on the businesses of the potential class members.  Using words like negligence and gross
    negligence to characterize this allegation does not alter its substance.  Consequently, insofar as the claims against
    TTC are concerned, we agree with the motion judges conclusion at para. 36 that
    the various claims advanced by Curactive were:

Being used to disguise what is a claim for compensation that is
    within the jurisdiction of the Ontario Municipal Board.

[7]

Furthermore, with one exception, we are
    satisfied that the claims made against the City are also claims for injurious
    affection that properly fall within the jurisdiction of the Ontario Municipal
    Board.  The one exception arises from the
    claim advanced in paras. 18 and 22 of the amended statement of claim.  In those paragraphs, Curactive alleges that
    the City: Unlawfully adopted an internal policy of blockbusting to
    intentionally cause harm to affected business interests

[8]

In our view, an allegation to
intentionally
harm others is not a claim of injurious affection.

[9]

The City argued before the motion judge and
    again in this court that if any part of Curactives pleadings survived the
    jurisdictional claim, that part of the claim should be struck pursuant to Rule
    21.01(1
)(
b) on the ground that it discloses no
    reasonable cause of action.  The motion
    judge did not address these submissions given his determination on the
    jurisdictional question.  We think it is
    appropriate for this court to consider the argument as it relates to the one
    claim that has survived the jurisdictional challenge.

[10]

Paragraphs 18 and 22 of the statement of claim
    are allegations of abuse of public authority and/or misfeasance in public
    office.  The claims as pled do not
    identify any individual who engaged in any improper conduct, do not identify
    with any specificity the alleged improper conduct, and provide no particulars
    in support of the allegations that the conduct was done with the intention of
    harming Curactive and others affected by it.  We are satisfied that as pleaded, the claim discloses no reasonable
    cause of action for intentional misconduct on the part of the City.

[11]

Should Curactive be allowed an opportunity to
    amend its pleadings?  The City made
    Curactive aware of its position with respect to the inadequacy of the pleadings
    a long time ago.  Numerous attempts by
    the City to secure particulars from Curactive were all but ignored.  Given that history, it is not appropriate at
    this late juncture to allow Curactive an opportunity to take the steps that it
    has declined to take in the past.  Furthermore, there is nothing in the record before this court to suggest
    that Curactive is in a position to amend its pleadings in a manner that would
    give any reasonable substance to its claim of abuse of public authority against
    the City.

[12]

The appeal is dismissed.

[13]

Curactive, in its factum, asks this court to
    interfere with the costs award made by the motion judge.  While it does not appear that Curactive has
    actually sought leave to appeal the costs award, in any event we can find no
    reason to intrude on the exercise of the motion judges discretion on this
    issue.

[14]

Costs of the appeal are
    awarded to the respondents as follows: to the City, $10,000, and to TTC,
    $17,000.  Both awards are inclusive of disbursements
    and HST.

Doherty J.A.

H.S. LaForme J.A.

Alexandra Hoy J.A.