COURT OF APPEAL FOR ONTARIO

CITATION:
Adam v. Ledesma-Cadhit, 2021 ONCA 828

DATE: 20211122

DOCKET: C67828

Brown, Roberts and Zarnett JJ.A.

BETWEEN

Abudu Ibn Adam, May Hyacenth
    Abudu, Ibrahim A.C. Abudu (a minor by his litigation guardian, Abudu Ibn Adam),
    and The Estate of Aminatawalla Napoga Chidinma Abudu (by the litigation
    administrator, Abudu Ibn Adam)

Plaintiffs (Appellants)

and

Christine J. Ledesma-Cadhit,
GlaxoSmithKline Inc.
, Her Majesty the Queen in Right of Canada,
    Her Majesty the Queen in Right of Ontario

Defendants (
Respondent
)

Jasmine M. Ghosn, for the appellants

Randy C. Sutton, Kate Findlay and Justine
    Smith, for the respondent GlaxoSmithKline Inc.

Heard: June 28, 2021 by video conference

On appeal from the judgment of Justice Markus
    Koehnen of the Superior Court of Justice, dated December 10, 2019, with reasons
    reported at 2019 ONSC 7066.

Brown J.A.:

OVERVIEW

[1]

Amina Adam was the daughter of the appellants, May Hyacenth Abudu and Abudu
    Ibn Adam. Amina died on November 28, 2009. She was five years old.

[2]

Five days prior to her death, Amina had received a vaccine called
    Arepanrix, which was manufactured and distributed by the respondent
    GlaxoSmithKline (GSK). Arepanrix was designed to protect against the H1N1
    influenza, known as the swine flu.

[3]

An autopsy concluded that the cause of Aminas death was unascertained,
    with sudden arrhythmic death syndrome not excluded. The investigating coroner
    found that the most likely cause of death was sudden arrhythmic death syndrome.
    However, the Paediatric Death Review Committee of the Office of the Chief Coroner
    ultimately classified Aminas cause of death as undetermined.

[4]

Aminas parents believed the vaccine had caused their daughters death.
    They commenced this action against GSK, Dr.
Christine J.
    Ledesma-Cadhit, their family physician who had administered the vaccine to
    Amina, Her Majesty The Queen in Right of Canada, and Her Majesty The Queen in
    Right of Ontario, alleging that Arepanrix had caused their daughters death.

[5]

Prior to trial, the
appellants discontinued the
    action against Dr.
Ledesma-Cadhit, and in 2014 the action was
    dismissed against the two government defendants: 2014 ONSC 5726.

[6]

Following a three-week trial, the trial judge dismissed
    the action against GSK. He began his reasons for judgment by observing that
    [a] parent can suffer no greater loss than that of a young child. As a father
    and grandfather, I share that sentiment; this is a very sad case. However, the
    trial judge concluded that the appellants had not introduced evidence that
    would demonstrate, on a balance of probabilities, that GSK breached the
    applicable standard of care or that Arepanrix caused Aminas death.

[7]

The appellants appeal. I will examine each of their grounds of appeal
    later in these reasons. However, having examined the evidence from the trial, I
    have concluded that the trial judge did not commit any reversible error that
    would justify interference by this court. Accordingly, I would dismiss the
    appeal.

BACKGROUND

The distribution of Arepanrix in the fall of 2009

[8]

In early 2009, the World Health Organization (WHO) learned about the
    development of a new strain of influenza virus: H1N1, commonly known as the
    swine flu. The WHO declared H1N1 to be a pandemic and, in the summer of 2009,
    called on drug manufacturers to begin clinical trials for a vaccine to combat
    H1N1.

[9]

GSK developed two vaccines: Arepanrix and Pandemrix. Pandemrix was
    manufactured and distributed in Europe; Arepanrix was manufactured and distributed
    in Canada. Clinical trials for Arepanrix began in 2008 but had not been
    completed when the pandemic was declared.

[10]

The
    Canadian Minister of Health authorized the sale of the Arepanrix vaccine
    pursuant to an interim order dated October 13, 2009 (Interim Order). As part
    of the Interim Order process, Health Canada agreed to indemnify GSK for any
    claims brought against it in relation to the administration of the Arepanrix
    vaccine.

[11]

Although
    human trials of Arepanrix were not finished by the time Health Canada
    authorized the vaccines use, the product was not without clinical history. GSK
    had developed other pandemic vaccines on which the H1N1 vaccine was based. The
    principal precursor was the H5N1 vaccine, developed in the early 2000s against
    bird flu that had developed in Hong Kong. The H5N1 vaccine was developed for
    use with an adjuvant, the role of which was explained by the trial judge:

An adjuvant is a substance that enhances the body's immune
    response to an antigen. When used with vaccines, an adjuvant is administered as
    a second injection separate from the vaccine. Use of an adjuvant is beneficial
    when dealing with an unexpected strain of influenza because manufacturing a
    sufficient number of vaccine doses for an unexpected virus can be problematic.
    An adjuvant, in effect, boosts the power of a vaccine, thereby allowing a lower
    dosage of the vaccine to be used.  This in turn allows a given number of
    vaccines to be distributed over a larger population than would be possible
    without an adjuvant.

[12]

Arepanrix
    was based on the H5N1 vaccine. The adjuvant that was used together with the
    vaccine had already been approved by Health Canada in another context. While
    clinical trials of both Arepanrix and Pandemrix showed a higher incidence of
    adverse events, particularly when used with an adjuvant, the intensity and
    frequency of the events were not sufficiently severe to cause regulatory concern.

[13]

Clinical
    trials of Arepanrix involving children had not started when Health Canada
    issued the Interim Order, nor was there any data about the use of Arepanrix in
    children at the time GSK received authorization for its sale. However, there
    was data on the use of the adjuvant with the H5N1 vaccine on children.

The administration of Arepanrix to Amina

[14]

Amina
    received the Arepanrix vaccine on Monday, November 23, 2009 from her family
    physician, Dr. Ledesma-Cadhit. Aminas mother and older brother received
    vaccinations at the same time from the same vials. Dr. Ledesma-Cadhit told
    Aminas mother to give the children Tylenol in the event of discomfort or
    fever.

[15]

Although
    Amina complained that she was not feeling well, she continued to attend school
    for the balance of the week.

[16]

On
    Saturday, November 28, Amina again complained that she was not well  she had
    pain in her feet and an upset stomach, but she continued to eat, although not
    as much as usual. Ms. Hyacenth took the children to a pharmacy across the
    street from their apartment to buy more Tylenol. As described by the trial
    judge:

After returning home, Ms. Hyacenth had decided to bring Amina
    to the emergency ward of a nearby hospital but would give Amina a bath and
    something to eat before doing so.

Ms. Hyacenth ran a bath for Amina. Amina needed to use the
    toilet. Ms. Hyacenth left her alone to do so but told her to call out when she
    was done.  Ms. Hyacenth returned to the kitchen to check on the soup she was
    cooking. When Ms. Hyacenth had not heard anything for a few minutes, she sent
    her son Ibrahim to check on Amina.  Upon entering the washroom he screamed for
    help. Amina appeared to have collapsed off of the toilet halfway into the tub.
    Ms. Hyacenth rushed to get Amina, laid her out on the living room floor and
    began administering cardiopulmonary resuscitation. An ambulance was called.
    Amina was taken to Scarborough General Hospital where she was pronounced dead
    shortly after arrival.

ISSUES ON APPEAL

[17]

The
    appellants advance five grounds of appeal:

Breach of the standard of care:

(i)

The trial judge erred in finding that GSK
    provided an adequate warning to Amina and her mother, as caregiver to Amina,
    with respect to Arepanrix;

(ii)

The trial judge erred in finding that GSK
    discharged its duty to warn by relying on the learned intermediary rule;

(iii)

The trial judge erred in failing to find that
    GSK did not meet the standard of care required of it with respect to its
    post-marketing commitments in terms of its continuing duty to the consumer to
    evaluate adverse events;

Causation:

(iv)

The trial judge erred in failing to find that
    the circumstantial evidence in this case raised an inference of negligence that
    called for an explanation from GSK;

Costs:

(v)

The trial judge erred in failing to award the
    unsuccessful appellants their full indemnity costs. The appellants submit that
    this case required adjudication by the courts as it was in the public interest
    and met the test of novelty, thereby justifying an award of costs to them.

FIRST ISSUE:
The adequacy of the warning by
    GSK

SECOND ISSUE: The application of the
learned
    intermediary rule

[18]

I
    propose to deal with the first and second issues together as the application of
    the learned intermediary rule is subsumed within the larger issue of whether
    GSK discharged its duty to warn of risks of the vaccine.

The governing legal principles

[19]

The
    general principles governing the duty to warn by manufacturers of medical
    products are well known, not in dispute, and were summarized by the Supreme
    Court in
Hollis v. Dow Corning Corp.
, [1995] 4
    S.C.R. 634, at paras. 20 to 29:

(i)

A manufacturer of a product has a duty in tort to warn consumers of
    dangers inherent in the use of its product of which it has knowledge or ought
    to have knowledge;

(ii)

The
    duty to warn is a continuing duty, requiring manufacturers to warn not only of
    dangers known at the time of sale, but also of dangers discovered after the
    product has been sold and delivered;

(iii)

All
    warnings must be reasonably communicated and must clearly describe any specific
    dangers that arise from the ordinary use of the product;

(iv)

The nature
    and scope of the manufacturers duty to warn varies with the level of danger associated
    with the ordinary use of the product. Where there are significant dangers, it
    will rarely be sufficient for manufacturers to give general warnings concerning
    those dangers. Instead, the warnings must be sufficiently detailed to give the
    consumer a full indication of each of the specific dangers arising from the use
    of the product;

(v)

Manufacturers
    of products such as drugs that are ingested, consumed or otherwise placed in
    the body, and thereby have a great capacity to cause injury to consumers, are subject
    to a correspondingly high standard of care under the law of negligence;

(vi)

There is a heavy onus on manufacturers of drugs to provide clear,
    complete, and current information concerning the risks inherent in the ordinary
    use of their product
;

(vii)

As a general
    rule, the duty to warn is owed directly by the manufacturer to the ultimate
    consumer. However, an exception known as the learned intermediary rule applies
    where a product is highly technical in nature and is intended to be used only
    under the supervision of experts, such as physicians, or where the nature of
    the product is such that the consumer will not realistically receive a direct
    warning from the manufacturer before using the product. Where an intermediate
    inspection of the product is anticipated or where a consumer is placing primary
    reliance on the judgment of a learned intermediary, such as a physician, and
    not on the manufacturer, a warning to the ultimate consumer may not be
    necessary and the manufacturer may satisfy its duty to warn the ultimate
    consumer by warning the learned intermediary of the risks inherent in the use
    of the product;

(viii)

The learned intermediary
    rule presumes that the intermediary physician is learned, in the sense that
    the physician is fully apprised of the risks associated with the use of the
    product. A manufacturer can only be said to have discharged its duty to the
    consumer when the intermediarys knowledge approximates that of the
    manufacturer. To allow manufacturers to claim the benefit of the rule where
    they have not fully warned the physician would undermine the policy rationale
    for the duty to warn, which is to ensure that the consumer is fully informed of
    all risks.

[20]

In
Hollis
, the Supreme Court identified the overarching
    question to be answered as whether the manufacturer owed the patient a duty to
    warn of a specific risk. The Supreme Court broke that overarching question down
    into two sub-questions:

(i)

Did the manufacturer have a duty to warn recipients of the medical
    product directly or could it satisfy its duty by warning a learned
    intermediary, such as a physician?

(ii)

If
    the manufacturer could properly discharge its duty by warning the physician,
    did it adequately warn the physician of the specific risk in light of its state
    of knowledge at that time?

[21]

I
    will follow the framework used by the Supreme Court in
Hollis
and review the trial judges reasons in light of the following two questions:

(i)

Did the trial judge err by concluding that GSK could satisfy its duty to
    warn recipients of Arepanrix by warning a learned intermediary physician, in
    this case Aminas family doctor, Dr. Ledesma-Cadhit?

(ii)

If
    GSK could properly discharge its duty by warning the physician, did the trial
    judge err in concluding that GSK adequately warned Dr. Ledesma-Cadhit of the
    relevant risks of Arepanrix in light of its state of knowledge at that time?

[22]

Whether
    GSK discharged its duty of care is a question of mixed fact and law, as it
    involves applying legal principles to facts, which requires interpreting and
    weighing evidence. That exercise attracts a standard of review of palpable and
    overriding error:
Housen v. Nikolaisen
, 2002
    SCC 33, [2002] 2 S.C.R. 235, at paras. 29 and 36.

Did the trial
    judge err by concluding that GSK could satisfy its duty to warn by warning an
    intermediary physician?

[23]

The
    trial judge held, in effect, that GSK could satisfy its duty to warn by
    informing Aminas family doctor of the risks associated with Arepanrix through
    the product monograph that accompanied each vial of vaccine and a Product
    Information Leaflet that was posted on the websites of GSK and Health Canada.
    He wrote, at paras. 37 and 38:

GSK did disclose in its Product Information
    Leaflet for the Arepanrix vaccine and in its product monograph that Health
    Canada had authorized the sale of the vaccine based on only limited clinical
    testing and no clinical experience at all with children. Dr. Ledesma-Cadhit
    believes she knew this from the Health Canada website.  She was also aware
    that Arepanrix was authorized through a special process because of the
    pandemic.

The product monograph for Arepanrix disclosed that there was
    limited clinical experience with an investigational formulation of another
    adjuvanted vaccine but no clinical experience with children.  In addition,
    the product information leaflet and product monograph disclosed a number of
    risks.

[24]

The
    appellants contend that the trial judge erred in so holding.

[25]

The
    appellants first submit that since Aminas mother independently learned about
    the vaccine and sought it out for her children, the learned intermediary rule
    does not apply. I disagree. The vaccine was a product that was highly technical
    in nature and which could only be obtained and used under the supervision of an
    expert, in this case Aminas family doctor. Those circumstances bring the
    vaccine squarely within the ambit of the learned intermediary rule.

[26]

The
    appellants next submit that Aminas family doctor did not possess the same
    level of information as GSK regarding the risk of a high fever in a child after
    receiving the vaccine and how to treat such a high fever. Specifically, they
    argue that:

(i)

on November 16, 2009, about a week before Amina received her dose of the
    vaccine, Health Canada had emailed GSK asking for more information about three
    cases of significant or high-level fever observed in children who had received
    the full dose antigen plus adjuvant. Yet, following that request for
    information, GSK did not publish to the general public any advisory regarding
    fever; and

(ii)

GSK
    prepared a Product Information Leaflet, which was approved by Health Canada. In
    its November 12, 2009 communication about the Ministers authorization of the
    vaccine sent out to about 50,000 physicians, GSK advised physicians to consult
    the Leaflet for detailed information about the vaccine and provided links to
    the document on the websites of Health Canada and GSK. The Leaflet contained a
    Consumer Information section that stated a common side effect of the
    vaccine was fever. The Leaflet advised that common side effects were usually
    mild and should only last a day or two. It went on to state: If any of these
    side effects occur, please tell your doctor or nurse immediately. If any of the
    side effects gets serious, or if you notice any side effects not listed in this
    leaflet, please tell your doctor. However, the product monograph placed in
    boxes of Arepanrix distributed to physicians did not contain the Consumer
    Information section.

[27]

It
    is clear the trial judge did not accept that either consideration prevented GSK
    from relying on Aminas family doctor to satisfy its duty to warn. Although the
    trial judges reasons do not offer a specific reason for that conclusion, the
    answer is clear from and supported by two pieces of evidence that came out of
    the testimony of Dr. Ledesma-Cadhit: see
R. v. G.F.
,
    2021 SCC 20, 71 C.R. (7th) 1, at para. 70. The record disclosed that:

(i)

Dr. Ledesma-Cadhit testified that, prior to administering the
    vaccine to Amina, she told Aminas mother that the side effects included fever
    and, if a fever appeared, she should administer Tylenol. As far as she could
    remember, Dr. Ledesma-Cadhit told Aminas mother
to return to
    her office if she had any concerns, if the children experienced any side effect
    the mother considered to be serious, or if the common symptoms described lasted
    a day or two;

(ii)

Dr. Ledesma-Cadhit also confirmed that before administering the
    vaccine to Amina, she had read the GSK product monograph for Arepanrix. The
    adverse reactions section of that document was identical to that in the Product
    Information Leaflet, describing the incidence of significant and high-level
    fevers in children who were part of the H5N1 study. Dr. Ledesma-Cadhit
    testified that she believed she went to the Health Canada website mentioned in
    the product monograph to obtain information about the vaccine. Dr.
    Ledesma-Cadhits evidence also suggested that she had probably read GSKs
    November 12, 2009 letter sent to physicians.

[28]

As
    well, during his cross-examination, Dr. Gaston De Serres, a medical doctor and
    epidemiologist called by GSK who was qualified as an expert witness at trial,
    responded to questions about the information included in the Arepanrix product
    monograph:

Q. Well, regardless of whats in Aminas
    record, Im just asking a clean question here on whether there is anything in
    the product monograph that gives guidance to doctors around use of the vaccine
    with children who have some history of respiratory illness?

A. I have not read this whole document but I
    would probably guess that there was none.

Q. Okay. And would  are you aware of any
    guidance given to doctors around the issue of fever as an adverse event thats
    coming out with the adjuvanted vaccine and how to manage the fever in the
    document?

A. Well, as I wrote in my report, this is not
    part of what we expect from product leaflet or inserts. This is done by, you
    know, how you care or how you manage patients with fever or adverse events
    following immunization is completely outside the realm of what is put in
    product leaflets. This is not done by manufacturers, its done by medical
    groups  advisory groups and is not put in that kind of product information
    sheet. And thats true not only for this product, its true for drugs, its
    true for everything, you know.

[29]

In
    light of that evidence, I see no reversible error in the trial judge applying
    the learned intermediary rule in the circumstances of this case.

Did the trial judge err in concluding that GSK adequately warned Dr.
    Ledesma-Cadhit of the relevant risks of Arepanrix in light of its state of
    knowledge at that time?

[30]

At
    trial, the appellants advanced several reasons why GSK had failed to adequately
    warn Dr. Ledesma-Cadhit about relevant risks associated with Arepanrix: some
    countries had refused to make the vaccine available because of safety concerns;
    Arepanrix was not appropriate for people with asthma; GSK had failed to convey
    at an early stage findings concerning unexplained phenomena and harm caused
    by its product; and the adverse event of Aminas death was not included in
    tracking data about the vaccine.

[31]

The
    trial judge addressed each submission. He held that the evidence did not
    establish the deficiencies asserted by the appellants:

(i)

There was no reliable evidence about the reasons why some other
    countries did not make Arepanrix available and the simple fact that certain
    jurisdictions did not approve Arepanrix is not enough to prove that GSK fell
    short of its standard of care by distributing Arepanrix in Canada;

(ii)

The
    medical evidence at trial was consistent that patients with asthma were
    preferred candidates to receive the vaccine because asthmatics can suffer more
    serious complications from flu than non-asthmatics and, in any event, Amina was
    never diagnosed with asthma;

(iii)

There was
    no evidence that GSK failed to convey at an early stage findings concerning
    unexplained phenomena and harm caused by Arepanrix. At paras. 43 to 51 of his
    reasons, the trial judge reviewed in some detail GSKs ongoing disclosure of
    information about the vaccine; and

(iv)

Although
    Aminas death was not reported directly to GSK, Dr. Ledesma-Cadhit had filed a
    timely adverse event report with Toronto Public Health Authorities, one of the
    approved channels for reporting adverse events.

[32]

The
    trial judge concluded, at para. 60:

The issues surrounding the standard of care here involve an
    understanding of the appropriate standards applicable to manufacturing, testing
    and approving drugs, as well as standards of disclosure to governments,
    physicians and the public when drugs are distributed.  In the absence of
    expert evidence that GSK failed to meet a particular standard and in the face
    of evidence that demonstrates GSK acted responsibly to disclose information,
    test products and manufacture products all in circumstances of urgency, I
    cannot find any breach of a standard of care.

[33]

On
    appeal, the crux of the appellants challenge to this holding by the trial
    judge is found in para. 56 of their factum where they list eight matters that
    GSK should have disclosed to Aminas mother, including the risk of a high
    fever.

[34]

I
    have already concluded that there is no reversible error in the trial judges
    finding that GSK was entitled to rely on a learned intermediary, Aminas family
    doctor, to satisfy its obligation to convey information about risks to the
    recipients of the vaccine. Further, the product monograph that accompanied the
    vaccine vial identified in some detail known adverse reactions to the vaccine,
    as disclosed both in the H1N1 studies conducted up until that time, as well as
    in the prior studies of the H5N1 vaccine which used the AS03 adjuvant. The
    appellants have not pointed to any evidence that GSK failed to disclose adverse
    risks that were known or ought to have been known at the time.

[35]

Moreover,
    the regulatory information published at the time informed the public of the cost/benefit
    assessment that led the Minister to make the Interim Order authorizing the
    administration of Arepanrix. GSK summarized the key parts of that regulatory
    information in the opening of the Arepanrix product monograph, which Aminas
    family physician testified that she read:

Health Canada has authorized the sale of
    Arepanrix H1N1 based on limited clinical testing in humans under the provision
    of an Interim Order (I0) issued on October 13, 2009.
The
    authorization is based on the Health Canada review of the available data on
    quality, safety and immunogenicity, and given the current pandemic threat and
    its risk to human health, Health Canada considers that the benefit/risk profile
    of the Arepanrix

H1N1 vaccine is favourable for
    active immunization against the H1N1 2009 influenza strain in an officially
    declared pandemic situation
.

[Emphasis added]

[36]

Given
    the making of the Interim Order, the onus of proof that lies on a plaintiff in
    any negligence action required the appellants to establish, on the balance of
    probabilities, that GSK did not meet its duty to provide Aminas family
    physician with clear, complete, and current information concerning the risks
    and dangers inherent in the ordinary use of Arepanrix:
F.H.
    v. McDougall
, 2008 SCC 53, [2008] 3 S.C.R. 41, at para. 40. The
    record discloses that the appellants failed to do so. As observed by the trial
    judge, one of the forensic difficulties of the appellants case at trial was
    that they did not adduce expert evidence that GSK had failed to adequately warn
    about specific risks of the vaccine. As a practical matter, e
xpert
    evidence concerning the complex area of vaccine manufacture and distribution was
    necessary
in the circumstances of this case
for the
    court to reach a conclusion of a breach in the standard.
Given the lack
    of any such evidence adduced by the plaintiffs, I see no reversible error in
    the trial judges conclusion that the appellants had failed to establish, on
    the requisite balance of probabilities, that GSK breached the applicable duty
    to warn.

[37]

I am
    not persuaded by this ground of appeal.

THIRD ISSUE:
GSKs post-marketing commitments

[38]

As
    stated in the Explanatory Note accompanying the Interim Order that authorized
    the sale of Arepanrix, GSK was
required to submit all the
    safety and

effectiveness data
    available at the time of the vaccine submission as well as a plan to

allow for the collection, assessment and
    reporting of information about the vaccines

safety and effectiveness.

[39]

Although
    the appellants Fresh as Amended Statement of Claim did not allege that GSK was
    negligent because it had failed to meet its post-marketing commitments, at
    trial the appellants alleged that GSKs failure to include Aminas death in its
    post-marketing tracking data constituted a breach of the standard of care.

[40]

The
    trial judge did not accept that submission. He held that although GSK did not
    learn of Aminas death until this lawsuit was started, the family doctor, Dr. Ledesma-Cadhit,
    had filed an adverse event report regarding Aminas death with the Toronto
    Public Health authorities.

[41]

The
    trial judge also found that there was no evidence to suggest that the tracking
    system that GSK or any of the public health authorities established somehow
    fell short of the standard of care applicable to tracking systems of this
    sort. Dr. Carole Legare, who in 2009 had been assigned to the Biologics and
    Genetics Therapies Directorate of Health Canada, testified about the
    post-marketing review of data concerning Arepanrix conducted by that agency. Dominique
    Barbeau, an employee of GSK, testified that the company had met all the
    post-marketing commitments that it had agreed to perform. The appellants did
    not lead any evidence to the contrary.

[42]

On
    appeal, the appellants repeat the submission they made at trial, in even stronger
    terms. As put in para. 68 of their factum: GSKs failure to investigate
    Aminas severe adverse event, and its significant reliance on government
    actors, amounts to bad faith and ought to have attracted punitive damages
    awarded to Aminas estate.

[43]

I do
    not accept this submission for several reasons.

[44]

First,
    this submission confuses the purpose of a civil trial with the purpose of a
    public inquiry or coroners inquest. Aminas parents understandably want a
    definitive explanation about what caused their daughters death. The coroners
    investigation and the resulting conclusion that the cause of Aminas death was
    undetermined did not provide them with such certainty. However, a civil trial
    is not a form of coroners inquest or public inquiry. While the civil pre-trial
    discovery process may disclose information not previously known by a party, the
    plaintiffs in a civil action labour under an obligation to establish, on a
    balance of probabilities, that some identifiable legal wrongdoing by the
    defendant caused an injury or death. The record fully supports the trial
    judges conclusion that the appellants failed to do so.

[45]

Second,
    the appellants action alleges that the administration of Arepanrix to Amina
    caused her death. Establishing liability for Aminas death would require the
    appellants to demonstrate, on a balance of probabilities, that some act or
    omission of GSK that took place
prior
to Aminas death caused her death. It is difficult to conceive how an act or
    omission of GSK that took place after Aminas death could have contributed to
    her death, which is essentially the thrust of the appellants breach of
    post-marketing commitment allegation. If, however, the appellants contention
    is that GSKs post-marketing activities failed to disclose a risk of the vaccine
    that should have been known to GSK
before
the vaccine was administered to Amina, their argument fails in light of the
    trial judges finding to the contrary, which they have not demonstrated is
    tainted by palpable and overriding error.

[46]

Finally,
    GSKs November 12, 2009 Letter to Health Care Professionals, which had been
    approved by Health Canada, asked physicians to report any case of serious or
    unexpected adverse events in patients receiving Arepanrix to their local public
    health authorities, the Public Health Agency of Canada, or GSK. On December 8,
    2009, Dr. Ledesma-Cadhit sent an adverse event report to Toronto Public Health
    that reported Aminas death five days following her vaccination. While there
    certainly is common sense merit to the appellants contention that local public
    health authorities should pass on adverse event information to a drug
    manufacturer, the failure to do so in this case did not cause or contribute to
    Aminas death and, therefore, cannot be a basis for civil liability in negligence
    against GSK.

[47]

Accordingly,
    I am not persuaded by this ground of appeal.

FOURTH ISSUE:
    The inference of negligence from the circumstantial evidence

[48]

The
    appellants also take issue with two findings made by the trial judge: (i) there
    was no direct or circumstantial evidence from which he could infer that GSK
    breached the standard of care ; and (ii) there was no evidence that Arepanrix
    could cause or in fact caused Aminas death.  In challenging those findings as
    errors, the appellants advance submissions that blend the issue of negligence
    (breach of standard of care) with the issue of causation. They argue that:

(i)

The circumstances surrounding Aminas death required the trial judge to
    call on GSK to explain Aminas death;

(ii)

If
    a risk falls within the realm of possibility, no matter how small or miniscule,
    causation is proved; and

(iii)

Consequently,
    if GSK could not rule out the vaccine as a cause of Aminas death, then GSK
    should share the familys burden and be found liable.

[49]

The
    appellants summarized their submission in para. 117 of their factum, stating:

The experts could not rule out Arepanrix H1N1 as a cause of
    Aminas death. We must, therefore, conclude that it is within the realm of
    possibility that Arepanrix H1N1 was a cause of Aminas death. Once that
    conclusion was reached, given that only GSK as the distributor of Arepanrix
    H1N1, could possibly have the relevant expertise to answer to the concerns
    arising from such conclusion, GSK must carry the burden (not the Plaintiffs) of
    going to the next step of ruling it out.

[50]

In
    considering this ground of appeal, I will first deal with the aspect of
    inferring a breach of the standard of care from circumstantial evidence and
    then with the aspect of causation.

(1)

Inferring a breach of the standard of care from circumstantial evidence

[51]

The
    appellants submission that the circumstances surrounding Aminas death
    required the trial judge to call on GSK to explain her death contains echoes of
    the discarded maxim of
res ipsa loquitur
,
    which dealt with the use of circumstantial evidence in negligence cases. The
    old maxim provided that a plaintiff could establish negligence by a defendant
    if (i) the thing that inflicted the damage on the plaintiff was under the sole
    management and control of the defendant, (ii) the occurrence in issue was such
    that it would not have happened without negligence, and (iii) there was no
    evidence as to why or how the occurrence took place:
Fontaine
    v. British Columbia (Official Administrator)
, [1998] 1 S.C.R. 424,
    at para. 18.

[52]

In
Fontaine
,
the Supreme Court of
    Canada concluded that whatever value
res ipsa loquitur
may once have provided to the adjudicative process had long since passed and
    went on to clarify, at para. 27, the proper use of circumstantial evidence in
    negligence cases:

It would appear that the law would be better served if the
    maxim was treated as expired and no longer used as a separate component in
    negligence actions.  After all, it was nothing more than an attempt to
    deal with circumstantial evidence.  That evidence is more sensibly dealt
    with by the trier of fact, who should weigh the circumstantial evidence with
    the direct evidence, if any, to determine whether the plaintiff has established
    on a balance of probabilities a
prima facie
case
    of negligence against the defendant.  Once the plaintiff has done so, the
    defendant must present evidence negating that of the plaintiff or necessarily
    the plaintiff will succeed.

See also:
Dickie v. Minett
,
    2014 ONCA 265, at para. 3.

[53]

The
    trial judge followed the approach directed by
Fontaine
but it led him to conclude that
there was no direct or
    circumstantial evidence from which he could infer that GSK breached its
    standard of care. Paragraphs 57 to 59 of his reasons explain the basis for that
    conclusion:

Arepanrix was developed based on the fully
    tested H5N1 vaccine. Even though Arepanrix was distributed and administered
    before the full course of clinical testing had run its course, that was done
    for valid public health concerns and with government approval, not by virtue of
    carelessness.

There was no evidence at trial to suggest that
    GSK had failed to disclose relevant information to Health Canada or to
    physicians. Similarly, there is no evidence to suggest that GSK disclosed false
    or misleading information to Health Canada or to physicians. Manufacture of
    Arepanrix was subject to government testing. Proactive measures were taken to
    become aware of safety signals once administration of Arepanrix began.

In the absence of contrary expert evidence
    about industry or regulatory standards, these circumstances indicate that GSK
    was acting responsibly and meeting its standard of care.
While
    I agree it is possible that GSK breached its standard of care in one or more of
    these steps or may have otherwise breached its standard of care, I am not able
    to make such a finding based on the evidence before me.
I note that GSK
    had a standard of care expert whom they did not call at trial after I
    questioned whether it was necessary to take trial time for that expert given
    the absence of any evidence on the issue from the plaintiffs. [Emphasis added]

[54]

The
    appellants have not established that those conclusions of the trial judge rest
    on any misunderstanding of the applicable law, misapprehension of the evidence,
    or palpable and overriding error of fact.

(2)

Causation

[55]

To
    succeed in an action for negligence, a plaintiff must establish that the
    defendants breach of the standard of care caused the injury or death:
Clements v. Clements
, 2012 SCC 32, [2012] 2 S.C.R. 181, at
    para. 6. In
Rothwell v. Raes
(1990), 2 O.R.
    (3d) 332 (C.A.), leave to appeal refused, [1991] S.C.C.A. No. 58, it was
    alleged that the administration of a vaccine to an infant had caused him brain
    damage. This court stated, at p. 333, that unless it was established that the
    vaccine could cause such damage, the plaintiff could not succeed. If such a
    general causal relationship was found to exist, the question became whether the
    vaccine did cause the damage suffered by the infant plaintiff.
[1]

[56]

In
    the present case, the trial judge carefully and accurately reviewed the
    evidence of the expert and lay witnesses relating to causation. He held that
    there was no evidence that the vaccine was capable of causing death and there
    was an absence of medical evidence that the vaccine caused or contributed to
    Aminas death: at paras. 119-120. Those findings were firmly anchored in the
    evidence adduced at trial.

[57]

The
    appellants submission that if a risk falls within the realm of possibility, no
    matter how small or miniscule, causation has been demonstrated mis-apprehends the
    established legal principles concerning causation. The trial judge properly
    rejected that submission when, at para. 64, he accurately stated and applied
    the governing legal principles:

The plaintiffs point to a number of witnesses, including
    defence experts, who agreed that the vaccine could not be excluded as a cause
    of death. That, however, is not the test that the plaintiffs must meet. The
    plaintiffs must prove on a balance of probabilities that the vaccine
caused
Aminas death. The fact that it could not be
    excluded as a possible cause does not meet the burden the plaintiffs must meet.

[58]

Further,
    the appellants submission that they had established the vaccine caused Aminas
    death because some defence experts, Drs. De Serres and Langley, testified they
    could not rule out the vaccine as the cause of her death ignores the entirety
    of those experts evidence.

[59]

In
    examination-in-chief, Dr. De Serres testified that in his opinion, Aminas
    death was not caused by the Arepanrix vaccine. On cross-examination, he
    testified as follows:

Q. So then doctor, would you say then
    confidently, there is no risk of a death in a child five days post vaccination
    with Arepanrix?

A. I would say that the likelihood of such an
    event...

Q. Im asking if there is a zero risk. Are you
    confident in stating there is zero risk?

A. Nobody would ever say zero risk. Wed just
     we can never rule that out.

[60]

On
    re-examination, Dr. De Serres testified that the likelihood the vaccine
    contributed to Aminas death was extremely low.

[61]

In
    her expert report, which was treated as her evidence-in-chief, Dr. Langley
    opined:

There is no evidence to support sudden death
    or cardiac arrest in humans at any point following receipt of H1N1 vaccine, and
    no evidence in that it led to this most unfortunate death in this child. The autopsy,
    biochemical tests and cultures do not identify a cause of death.

[62]

On
    cross-examination, Dr. Langley expressed the opinion that Aminas death was
    unexplained. She went on to testify that
because we dont
    know the cause we cant exclude anything. Since there was no evidence of what
    caused Aminas death, anything could be the cause really, but we have no
    evidence.

[63]

When
    fairly read in their entirety, the testimony of Drs. De Serres and Langley
    provide no assistance to the appellants task of establishing, on a balance of
    probabilities, that the vaccine caused Aminas death.

[64]

I am
    not persuaded by this ground of appeal.

FIFTH ISSUE: The failure to award costs to the unsuccessful
    appellants

[65]

The
    appellants final ground of appeal concerns the trial judges award of costs to
    GSK.

[66]

While
    the appellants were unsuccessful at trial, they sought a cost award of
    $564,559.30 on the basis of the cases exceptional circumstances.

[67]

The
    trial judge concluded that this was not one of those exceptional cases in which
    the unsuccessful party should be awarded costs. He rejected the appellants
    submission that there were prelitigation circumstances that had provoked the
    litigation, making this case an exceptional circumstance. As well, he noted
    that prior to trial, GSK had made three settlement offers to the appellants,
    which increased in amount from the payment of $150,000 to the appellants to
    $300,000.

[68]

Although
    GSKs partial indemnity costs of the action were about $450,000, the company
    only sought costs of $50,000, which the trial judge awarded on the basis that
    GSK was the successful party at trial.

[69]

The
    appellants submit that cost award was an error. They advance several reasons
    why the trial judge should have made an exceptional award of costs to them
    notwithstanding they had failed to prove their case: (i) the vaccine could not
    be excluded as a cause of Aminas death; (ii) the family had incurred the cost
    of investigating Aminas death which was a severe adverse event to Arepanrix
    H1N1; (iii) the information collected pursuant to GSKs post-marketing
    commitments increased knowledge about the vaccine; (iv) GSK had a duty to
    investigate Aminas death; (v) when Amina took the jab, this benefited the
    community as a whole as part of the concept of herd immunity; and (vi) the
    case involved a matter of public interest, namely the consumer protection of
    vulnerable children.

[70]

I am
    not persuaded by the appellants submissions. Absent an error in principle or a
    clearly unreasonable result, deference is owed to a trial judges exercise of
    discretion in awarding costs. The trial judge recognized that he could award
    costs in favour of the unsuccessful appellants, but he concluded that this is
    not a case that even approaches the circumstances in which such an order should
    be made. Specifically, he wrote:

While it may have been appropriate for the
    plaintiffs to commence the action when they did, none of the information as it
    evolved pointed to the GlaxoSmithKline vaccine as a cause of death. As noted in
    my reasons, this was not a case that came close to establishing liability nor
    was it anywhere near a tough call. There was simply no evidence to relate
    Aminas death to the vaccine. By the time the plaintiffs had their own experts
    report they should have known that it was highly unlikely that they could
    establish causation. By the time the plaintiffs had the defence experts
    reports, that became even clearer.

In those circumstances, an offer of $300,000
    shortly before trial was one that was objectively highly attractive.

[71]

I
    see no basis upon which to interfere with the trial judges discretionary award
    of costs to GSK. He took into account factors relevant to a request for costs
    by an unsuccessful party and explained why those factors did not justify
    departing from the generally applicable principle that costs follow the cause.

DISPOSITION

[72]

For
    the reasons set out above, I would dismiss the appeal.

[73]

If the parties are unable to agree on the costs of the appeal
    within 15 days of the release of these reasons, they may submit written cost
    submissions, which are not to exceed 5 pages in length, excluding any cost
    outline or bill of costs.

Released: November 22, 2021 DB

David
    Brown J.A.

I
    agree. L.B. Roberts J.A.

I
    agree. B. Zarnett J.A.

[1]
In the
    defective drug jurisprudence, whether a drug is capable of causing harm is
    referred to as general causation; whether it in fact caused harm to the
    plaintiff is known as individual or particular causation. For a discussion, see
Harrington v. Dow Corning Corp
.
,
    2000 BCCA 605, 82 B.C.L.R. (3d) 1, at paras. 42 to 46, leave to appeal refused,
    [2001] S.C.C.A. No. 21;
Batten v.
    Boehringer Ingelheim (Canada) Ltd.
, 2017 ONSC 53, at para. 38, affd 2017
    ONSC 6098 (Div. Ct.), 20 C.P.C. (8th) 414, leave to appeal to Ont. C.A.
    refused, M48535 (February 28, 2018);
Wise
    v. Abbott Laboratories, Limited
, 2016 ONSC 7275, 34 C.C.L.T. (4th) 25,
    at para. 340; Patricia Peppin, Vaccines and Emerging Challenges for Public Health
    Law in Tracey M. Bailey, C. Tess Sheldon, Jacob J. Shelley, eds.,
Public Health Law and Policy in Canada
,
4th ed. (Toronto: LexisNexis Canada, 2019), §III.


COURT OF APPEAL FOR ONTARIO

CITATION:
Boehme (Re), 2021 ONCA 831

DATE: 20211122

DOCKET: C69027

Hoy, Coroza and Sossin JJ.A.

IN THE MATTER OF:  Ralph Peter Boehme

AN APPEAL UNDER PART XX.1 OF THE
CODE

Ralph Peter Boehme, acting in person

Erin Dann, appearing as
amicus
curiae

Nicholas Hay, for the respondent, the Attorney
    General of Ontario

Gavin S. MacKenzie, for the respondent,
    Ontario Shores Centre for Mental Health Sciences

Heard: November 16, 2021

On appeal against the disposition of the
    Ontario Review Board dated, December 15, 2020, with reasons dated January 13,
    2021.

REASONS FOR DECISION

[1]

On August 23, 2011, the appellant was found not criminally responsible
    by reason of mental disorder on charges of uttering threats to cause death or
    bodily harm and failure to comply with a probation order. He has been under the
    jurisdiction of the Ontario Review Board since that time. His current diagnoses
    are delusional disorder and alcohol use disorder.

[2]

The appellant appeals the Boards disposition of December 15, 2020,
    granting him a conditional discharge. He argues that the Boards finding that
    he continues to pose a significant risk to public safety is unreasonable. The
    index offence did not involve violence and he does not have a history of
    violent aggression. He submits there was no evidence before the Board that he
    would not pursue his grievances through appropriate legal channels. He has
    behaved well at his residence and has not missed any appointments at the
    hospital. He wishes to reside at the apartment he occupied at the time of the
    index offence. He seeks an absolute discharge.

[3]

Amicus curiae
submits that the Board erred by not fully
    exercising its general inquisitorial powers and requests that the Board be
    directed, or urged, at the appellants next hearing, to ensure adequate efforts
    are being taken to further the appellants reintegration in the community,
    despite the seemingly intractable nature of his delusional disorder.

[4]

We are not persuaded that the Boards finding that the appellant
    continues to pose a significant risk was unreasonable. The appellants
    treatment team was clear that absent the Boards supervision, the appellant
    would almost certainly return to substance abuse, discontinue his medication
    (particularly clozapine), gravitate towards inappropriate housing, and pursue
    the victim of the index offence (and perhaps others by whom he felt wronged or
    slighted) in a harassing and threatening manner causing serious psychological
    harm. The Board was entitled to accept that assessment.

[5]

Nor are we persuaded that there is any basis to interfere with the
    Boards exercise of its general inquisitorial powers.

[6]

On the appellants appeal of the Boards previous disposition,
amicus
argued that the Board failed to properly inquire into what it submitted was a
    treatment impasse. The court rejected that argument, finding that there was
    little in the record to establish that there was an impasse:
Boehme (Re)
,
    2020 ONCA 735. However, the court added this, at para. 5:

That said, the appellant has been under the supervision of the
    Board since 2011. We are concerned that there has been a lack of real progress
    in addressing the appellants condition since that time. The evidence does show
    that, at least recently, the appellants medical team has been considering
    alternate diagnoses and other forms of treatment. We would urge the Board to
    look closely at these efforts at the appellants next review (which is to be
    held shortly) and ensure that adequate steps are being taken to try and advance
    proper treatment of the appellants condition.

[7]

Amicus
argues that the Board failed to heed this direction. In
    particular, it failed to probe the appellants treating physician Dr.
    Hartfeils explanation that the appellant derived very little benefit from
    the alternate form of treatment, namely one-on-one cognitive behavioural
    therapy, that had been under consideration at the time of the previous hearing
    and was not willing to participate any further.
Amicus
says that the
    Board should have asked what further alternative forms of treatment or therapy
    could be tried and asked why there was very little benefit.
Amicus
suggests that there may have been very little benefit because of the need to
    provide sessions by phone or video because of the COVID-19 pandemic, or because
    at the time the appellant was overusing lorazepam to treat his anxiety.
    Similarly,
amicus
argues that the Board should have asked the
    appellant why he was unwilling to participate in this therapy.

[8]

Amicus
concedes that this is not a situation where there is a
    treatment impasse. The appellants situation has improved, as reflected in his
    conditional discharge. The treatment team found an appropriate treatment for
    the appellants anxiety, which the treatment team explained contributes to his
    use of substances and possibly also contributes to his sort of obsessionality
    or preoccupation with his various grievances, and therefore affects his risk
    of reoffending. The appellant has developed a better rapport with his treatment
    team and shown an ability  with the assistance of the treatment team  to
    manage his risk factors in the community without readmission to hospital.

[9]

The Board is afforded broad discretion in determining when additional
    information is necessary, in [its] view:
Kassa (Re)
, 2020 ONCA 543, at
    para. 34. In our view, this expert Board was fully engaged and appropriately
    exercised its general inquisitorial powers. It carefully reviewed the courts endorsement
    with Dr. Hartfeil and explored whether non-pharmacological treatment could
    be revisited. Dr. Hartfeil explained that the challenges the appellant faces in
    benefitting from psychotherapeutic interventions are most[ly] related to his
    personality and some cognitive deficits as well. The Board also explored
    whether an occupational therapist might be able to assist and what could be
    done to build community-based supports over the upcoming year. Dr. Hartfeil
    indicated that all of those things could be pursued, and we expect that the Boards
    attentiveness to these issues will continue.

[10]

Accordingly, the appeal is dismissed.

Alexandra
    Hoy J.A.

S.
    Coroza J.A.

Sossin
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: MDS Inc. v. Factory Mutual
    Insurance Company, 2021 ONCA 837

DATE: 20211122

DOCKET: C68300

Feldman, Harvison Young and
    Thorburn JJ.A.

BETWEEN

MDS Inc. and MDS
    (Canada) Inc. c.o.b. MDS Nordion

Plaintiffs
    (Respondents)

and

Factory Mutual
    Insurance Company c.o.b.

FM Global

Defendant (Appellant)

Paul
    J. Pape, David E. Liblong, Shantona Chaudhury and Cristina Senese, for the
    appellant, Factory Mutual Insurance Company

Brian
    J.E. Brock, Q.C., for the respondents, MDS Inc. and MDS (Canada) Inc.

Glenn A. Smith and Nina Bombier, for the intervener,
    Insurance Bureau of Canada

Heard: April 15, 2021 by video conference

On appeal from the judgment of Justice
    Janet Wilson of the Superior Court of Justice, dated September 9, 2020, with
    reasons reported at 2020 ONSC 1924 (damages) and 2020 ONSC 4464 (interest and
    costs).

COSTS
    ENDORSEMENT

[1]

This appeal was about whether the appellant
    insurer, Factory Mutual Insurance Company (FM Global), was required to
    provide insurance coverage for losses arising from an unplanned shutdown of the
    Atomic Energy of Canada Limited (AECL) Nuclear Research Universal (NRU)
    reactor located in Chalk River, Ontario on May 14, 2009.

[2]

The respondent MDS Inc. is a global health
    science company. The respondent MDS (Canada) Inc. is its Canadian subsidiary.
    They are together referred to as MDS. MDS agreed to buy radioisotopes from
    AECL to be produced at the NRU reactor. FM Global issued MDS an all-risk
    insurance policy (the Policy).

[3]

The central issues at trial were (i) the
    interpretation of the corrosion exclusion in the Policy and (ii) whether MDS business
    losses arising from the shutdown of the NRU reactor were payable pursuant to
    the exception to the exclusion for physical damage caused by corrosion.

[4]

The issues raised on appeal were (i) the standard
    of review to be applied to the interpretation of the Policy, (ii) the
    interpretation of the Policy and in particular, whether the term corrosion
    was ambiguous and should be interpreted to mean the anticipated and
    predictable process of corroding and whether the exception to the exclusion
    for physical damage in the Policy was ambiguous and should be interpreted to
    include loss of use; and (iii) if there was coverage, whether compound prejudgment
    interest at the rate of actual borrowing costs should have been ordered given
    that this was not contemplated in the Policy agreement.

[5]

The appeal was allowed. The corrosion exclusion was
    held to apply. The term physical damage in the exception to the exclusion
    clause was held not to apply to economic losses caused by the inability to use
    the equipment during the shutdown. MDS losses were not covered by the Policy
    and coverage was therefore denied.

[6]

The court ordered costs of the appeal to the
    appellant, FM Global. Those costs were agreed to by the parties.

[7]

In keeping with this courts decision in
St.
    Jean v. Cheung
,
2009 ONCA 9, at para. 4, and
Hunt v. TD
    Securities
,
66 O.R. (3d) 481 (C.A.) at para. 188, since the appeal
    was allowed, the trial judges decision on costs was set aside.

[8]

The parties were unable to agree on the quantum
    of costs to be awarded to FM Global for trial costs and written submissions
    were therefore received from the parties.

[9]

FM Global seeks trial costs in the amount of $561,103.95
    (fees of $241,284 plus HST at a partial indemnity rate and disbursements of $255,268.17
    plus HST). This sum reflects costs detailed in the appellants Bill of Costs
    that was provided to the trial judge.

[10]

By comparison, the amount of costs awarded by
    the trial judge to MDS was $1,266,105.48 (including fees of $1,104,242.36 at a
    partial indemnity rate and disbursements of $161,863.12).

[11]

FM Global seeks an award of costs that is approximately
    25 percent of the costs awarded to MDS by the trial judge.

[12]

While not all issues analyzed at trial were
    raised on appeal, FM Global was entirely successful on appeal and is therefore
    entitled to its reasonable costs of the trial.

[13]

Section 131(1) of the
Courts of Justice Act
,
R.S.O. 1990, c. C.43, provides that costs of a proceeding are within the
    discretion of the court. We have considered the factors set out in r. 57.01(1)
    of the
Rules of Civil Procedure
, R.R.O. 1990, Reg. 194. In particular,
    the importance of the issues, the conduct of the parties, the principle of
    indemnity including the lawyers experience, rates charged and hours spent, the
    fact that the appeal was neither improper nor vexatious, and the amount the
    losing party could reasonably expect to pay.

[14]

First, the issues pursued at trial and on appeal
    were both complex and important. Over CA$56 million was at stake and several
    experts were engaged by each of the parties to determine the claim. Moreover, this
    courts interpretation of the Policy was of precedential value as the claim
    involved a standard form policy that is used by insurers throughout the
    insurance industry across North America.

[15]

Second, FM Globals counsels hourly rates, as indicated in their
    submitted docket entries, were very reasonable. Further, the fees requested by
    FM Global reflect a partial indemnity rate. Therefore, it is unnecessary and inappropriate
    to take the approach the trial judge used to calculate MDSs counsels partial
    indemnity costs, which was to reduce its full indemnity bill by 50 percent.

[16]

Third, we agree that FM Global should be allowed to recover the
    disbursements for expert advice regardless of whether the expert reports were introduced
    at trial or relied on by the trial judge.

[17]

Each of the parties engaged multiple experts, and
    the court itself appointed an expert. All expert fees were incidental to the
    litigation. The experts quantified the losses and responded to issues raised by
    the opposing parties experts.

[18]

FM Globals expert accounting firm, Matson, Driscoll & Damico
    (MDD), analyzed MDS expert reports. MDDs expert advice concerned the quantification
    of loss from the date of the shutdown for the entire duration of the outage and
    the quantification of prejudgment interest. Although the expert report was not
    introduced at trial, the amounts were reasonably incurred to respond to the
    issues raised by MDS.

[19]

We note that reasonable expert fees for expert reports reasonably
    necessary for the conduct of the proceeding are recoverable whether or not the
    expert is called to give evidence
: Charlesfort
    Developments Limited v. Ottawa (City)
,
2021 ONCA 542, at para. 6,
leave to appeal S.C.C. requested,
    39818. Nonetheless, the fact that the expert was not called to give evidence is
    a factor to be taken into account in determining the reasonableness of the
    overall fees charged:
Charlesfort
,
at
    para. 7.

[20]

The reasonableness of retaining the expert is to be considered at
    the time the expense is incurred not in hindsight:
Fan
    (Guardian ad litem of) v. Chana
,
2011 BCCA 516, 345 D.L.R.
    (4th) 453, at para. 56. Neither the retainers nor the amounts charged are, in
    our view, untoward.

[21]

Disbursements for a retainer to Claims Services International
    Ltd. and Granitetown Services Inc. to locate the Chief Nuclear Officer at AECL,
    who was a key witness for FM Global, were reasonably incurred. Further, the
    expert fees for a r. 53 expert, Dr. Revie, to interpret and analyze MDS expert
    reports were also reasonably incurred even though not relied on by the trial
    judge.

[22]

For these reasons, as requested, FM Global is awarded its partial
    indemnity costs and disbursements in the amounts of $561,103.95
(including fees of $241,284 plus HST and disbursements of
    $255,268.17 plus HST).

K. Feldman J.A.

A. Harvison Young
    J.A.

J.A. Thorburn J.A.


WARNING

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

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

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

(a)     any of
    the following offences;

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

COURT OF APPEAL FOR ONTARIO

CITATION:
R. v. D.Q., 2021 ONCA 827

DATE: 20211122

DOCKET: C68138

MacPherson, Simmons and
    Nordheimer JJ.A.

BETWEEN

Her Majesty the Queen

Respondent

and

D.Q.

Appellant

Andrew Furgiuele, for the appellant

Frank Au, for the respondent

Heard: November 1, 2021 by video conference

On appeal from the convictions entered
    on November 20, 2019 by Justice Robert B. Reid of the Superior Court of Justice.

MacPherson
    J.A.:

A.

Introduction

[1]

The appellant was convicted of several sexual
    offences. At his trial, the appellant testified. During his testimony, the Crown
    proposed to ask him questions about prior sexual activity. Defence counsel
    objected. The Crown suggested that the appellant should be excluded from the
    courtroom while the objection was being discussed. The trial judge agreed.
    Defence counsel did not object. The trial judge ordered the appellant to leave
    the courtroom. After very brief submissions (probably a minute at most), the
    trial judge made a brief ruling (one paragraph) prohibiting the proposed line of
    questions. The trial continued.

[2]

The parties agree that the exclusion of the
    appellant during a portion of his trial was a clear violation of s. 650(1) of the
Criminal Code
which provides, in relevant parts, an accused  shall
    be present in court during the whole of his or her trial.

[3]

The respondent Crown seeks to save the
    conviction on the basis of the proviso in s. 686(1)(b)(iv) of the
Criminal
    Code
. The appellant resists this argument on the merits. In the
    alternative, the appellant contends that this should not be considered under
    the proviso rubric; rather, relying on a fairly recent decision of the New
    Brunswick Court of Appeal, the appellant contends that the proper analytical
    framework for this and similar cases should be a combination of sections 7, 11(d)
    and 24(1) of the
Canadian Charter of Rights and Freedoms
.

B.

facts

(1)

The parties and events

[4]

The appellant was charged with one count each of
    sexual assault, sexual interference, and invitation to sexual touching. The
    appellant was in high school at the time of the alleged incidents and was
    around 16 or 17 years old. The complainant was about 10 to 12 years old at the same
    time.

[5]

The appellant was a babysitter for the
    complainant and his younger brother at the time of the incidents. The evidence
    was that the younger brother was asleep during the incidents and no one else
    was at home.

[6]

The complainants testimony at trial was that the
    appellant told him about a game of truth or dare that he played with some of
    his teenage friends. The appellant used this game as a basis for suggesting to
    the complainant that they engage in various sexual activities. According to the
    complainant, sexual activities included the complainant stroking the appellants
    erect penis and putting his mouth on it. The complainant also testified that
    the appellant would perform oral sex on him. These activities took place in
    several locations throughout the house, including a living room chair, the
    basement, a bathtub, and the complainant's bedroom.

[7]

The complainant testified that the appellant was
    never violent or abusive; he was simply a nice and pleasant guy. The
    complainant felt he had no choice but to participate. Aside from mentioning one
    incident to the appellants brother, the complainant did not tell anyone about
    the sexual incidents until 21 years later.

(2)

The appellants exclusion from the trial

[8]

The appellant testified at trial. He strongly
    denied all of the complainants allegations. During his cross-examination, the
    Crown introduced the topic of the appellants prior sexual history when he was a
    younger teenager and even pre-teen. This led to an objection by defence
    counsel, a request by the Crown, and a ruling by the trial judge. All of this
    took place in about two or three minutes and is recorded in two pages of trial
    transcript, which I set out as follows:

Q.      Were you ever sexually active with
    her? [a previous elementary school girlfriend]

A.      I mean, we were very young so to say
    sexually active, I mean, we kissed, we held hands. Very light petting.

Q.      What's  what is "petting"
    mean?

[Defence counsel]:          I don't know  I
    don't know how relevant all of this is, Your Honour; where my...

THE COURT:        [Crown]?

[Defence counsel]:          ...friend is going
    with this.

[Crown]:       It's  well, perhaps we can ask
    the witness to step out.

THE COURT:        All right.

[Defence counsel]:          Well, these.....

THE COURT:        [D.Q.], perhaps you can just
    step outside the courtroom. Dont go far away.

A.      Okay.

THE COURT:        We'll have a discussion and
    we'll get you back in.

...WITNESS IS EXCUSED

[Crown]:       Your Honour, I think [D.Q.]s
    sexual history, particularly as a young child, a teen, preteen, a teenager, is
    relevant to whether or not he would be sexually active at 17  at 18 years old,
    for instance, when these allegations were made. So I just want to know if he is
     was sexually active throughout his younger years. The allegations are that he
    was having oral sex and masturbating the complainant. I think it's relevant to
    know when he became sexual active. And if he was, when he was babysitting or
    during the time period he was babysitting the  the complainant.

[Defence counsel]:          Does my friend
    suggest if he was an active sexual teenage boy, that he's more likely to have
    sexually assaulted a young boy?        I mean, that  there's no connection to
    that. I mean, if he's a teenager where he's sexually active, does that make him
    more likely to have committed this offence? There's no correlation, in my
    respectful submission.

R U L I
    N G

[Trial judge]
(Orally)

We have an individual, who at that age of 16
    or 17, has said that he had a relationship most of his high school years and
    prior to that had another relationship during elementary school. When he became
    sexual active, it seems to me, is of very minimal, if any, relevance to this inquiry.
    It would not be surprising that any 16 or 17 year old boy in high school with a
    relationship with another individual is engaged in some form of sexual
    activity. I'm not suggesting intimate sexual activity. That's just the way it goes.
    And I think I can take judicial notice of that. When or whether that
    relationship existed with another person in elementary school, I think has no
    bearing on this inquiry.

[Crown]:       Thank you, Your Honour.

[Defence counsel]:          Thank you.

THE COURT:        Let's have [D.Q.] back in
    the courtroom, please.

...WITNESS RESUMES STAND

[9]

The appellants sole ground of appeal relates to
    the trial judges ruling excluding him from a portion of his trial.

C.

issues

[10]

Although there is substantial intersection and
    overlap between the two issues advanced by the appellant on this appeal, I
    propose to address them in this order:

1.

Did the exclusion of the appellant from a
    portion of his trial violate s. 650(1) of the
Criminal
    Code
and, if so, should this error be remedied by
    application of s. 686(1)(b)(iv) of the
Criminal
    Code
?

2.

Did the exclusion of the appellant from a
    portion of his trial violate ss. 7 and 11(d) of the
Charter
and, if so, should this error
    be remedied by an application of s. 24(1) of the
Charter
?

D.

analysis

(1)

The proviso issue

[11]

The parties agree that s. 650(1) of the
Criminal Code
was breached in the
    appellants trial. The Crown should not have requested that the appellant be
    ordered to leave the courtroom during his own testimony. Defence counsel should
    have opposed this request. The trial judge should not have made the order.

[12]

The Crowns sole response to this state of
    affairs is reliance on s. 686(1)(b)(iv) of the
Criminal Code
which provides:

686(1) On the hearing of an appeal
    against a conviction  the court of appeal

(b) may dismiss the appeal where

(iv) notwithstanding any
    procedural irregularity at trial, the trial court had jurisdiction over the
    class of offence of which the appellant was convicted and the court of appeal
    is of the opinion that the appellant suffered no prejudice thereby .

[13]

The Crowns position is that the trial judges
    order briefly excluding the appellant from his trial caused him no prejudice.

[14]

Fortunately, there is a good deal of case law
    from the Supreme Court of Canada, this court, and other provincial appeal
    courts dealing with the interplay between ss. 650 and 686(1)(b)(iv) of the
Criminal Code
. I propose to consider
    some of that case law and then apply it to this appeal.

[15]

An early leading case was the decision of this
    court in
R. v. Hertrich
(1982), 67 C.C.C. (3d) 510 (Ont. C.A.), a case involving a trial
    judge interviewing, without the accused being present, two jurors about two
    anonymous telephone calls one of them had received the day before. Martin J.A.
    eloquently described the underlying rationale for s. 577, the predecessor
    section to the present s. 650 of the
Criminal Code
, at para. 81:

The essential reason the accused is entitled
    to be present at his trial is that he may hear the case made out against him,
    and, having heard it, have the opportunity of answering it.  The right of the
    accused to be present at his trial, however, also gives effect to another
    principle. Fairness and openness are fundamental values in our criminal justice
    system. The presence of the accused at all stages of his trial affords him the opportunity
    of acquiring first-hand knowledge of the proceedings leading to the eventual
    result of the trial. The denial of that opportunity to an accused may well
    leave him with a justifiable sense of injustice.

[16]

The leading decision of the Supreme Court of
    Canada in this domain is
R. v. Barrow
, [1987] 2 S.C.R. 694, a case involving a trial judge considering
    claims for exemption from the jury panel in the courtroom but out of earshot of
    all counsel and the accused.
[1]
In
Barrow
, at para. 20,
    Dickson C.J. endorsed Martin J.A.s two important principles that underlie s.
    577, and continued, at para. 48:

It is important for the accused to see and
    hear the entire process by which he or she is tried so that he or she sees that
    the trial is fair.  The public perception of the fairness of the trial process
    would be damaged if potential jurors were excluded after private conversations
    with the judge.  Finally, the trial judges error in this case was of a
    fundamental nature and therefore the curative provisions in  the
Code
should not be applied.

[17]

In Ontario, there are three leading cases
    dealing with the interplay between ss. 650 and 686(1)(b)(iv) of the
Criminal Code
.

[18]

In
R. v. Simon
, 2010 ONCA 754, in a second degree murder trial, the trial judge
    discussed his proposed jury instructions in chambers with counsel but without
    the accused.

[19]

Watt J.A. determined that the chambers
    discussion was part of the trial; he said, at para. 109:

To determine whether something that happened
    in the course of a trial was part of the trial for the purposes of s. 650(1)
    requires an examination of whether what occurred affected the vital interests
    of the accused. No one can gainsay that what was discussed here, the
    contents of final jury instructions, affected the vital interests of the
    appellant.

[20]

Turning to the potential application of the
    proviso, Watt J.A. said, at paras. 118-19:

Where something takes place in the absence of
    the accused that is part of the trial for s. 650(1) purposes, it does not
    inevitably follow that a new trial must be ordered if the accused is
    convicted.

Section 686(1)(b)(iv) of the
Criminal
    Code
came into force on December 4, 1985. Its real focus seems to
    have been to inter the jurisprudence that regarded procedural errors that
    caused trial courts to lose jurisdiction as incurable, even on appeal:
R.
    v. Khan
, [2001] 3 S.C.R. 823, at para. 12. Its embrace includes but is not
    limited to the procedural irregularity caused by the absence of the accused
    during his or her trial.

[21]

Watt J.A. continued by articulating a test that
    could be applied when considering whether the proviso should be applied in a
    case where s. 650 of the
Criminal Code
has been breached. He said, at para. 123:

To determine whether a breach of s. 650(1) may
    be salvaged by the application of the proviso in s. 686(1)(b)(iv) requires
    a consideration of all the circumstances surrounding the violation. Relevant
    factors may include, but are not limited to: (i) the nature and extent of the
    exclusion, including whether it was inadvertent or deliberate; (ii) the role or
    position of the defence counsel in initiating or concurring in the exclusion;
    (iii) whether any subjects discussed during the exclusion were repeated on the
    record or otherwise reported to the accused; (iv) whether any discussions in
    the accuseds absence were preliminary in nature or involved decisions about
    procedural, evidentiary or substantive matters; (v) the effect, if any, of the
    discussions on the apparent fairness of trial proceedings; and (vi) the effect,
    if any, of the discussions on decisions about the conduct of the defence.

[22]

In the second Ontario case
, R. v. E. (F.E.)
, 2011 ONCA 783, the
    accused was excluded during the entire pre-jury charge conference in the trial
    judges chambers. He was also excluded during a brief period (about nine
    minutes) regarding discussions about a potential question being put to him
    during cross-examination.

[23]

On the broader issue, Watt J.A. spoke bluntly
    and ordered a new trial. He said, at para. 52:

Final instructions to a jury in a criminal
    case are of the utmost importance to the person whose liberty is at stake.
    Those instructions explain the basis upon which the accuseds liability will be
    decided and his or her defence assessed. An accused is entitled to hear
    why some instructions are included and others are omitted from the charge
    first-hand, the complete version and not a synopsis after the fact. The
    exclusion of an accused from the entire pre-charge conference undermines both
    the appearance and the reality of the due administration of justice.

[24]

On the narrower issue, which is very similar to
    the issue on this appeal, the court reached a different conclusion. Watt J.A.
    said, at para. 44:

What happened here was that the intentional
    and understandable exclusion of a witness resulted in the exclusion of the
    appellant and a breach of s. 650(1) of the
Criminal Code
. This
    should not have occurred. An accused has the right to be present
    throughout the entirety of his or her trial, including during discussions
    pertaining to cross-examination. Nonetheless, in the circumstances of this
    case as I have described them, if this nine-minute exclusion stood alone, I
    would apply s. 686(1)(b)(iv) to the procedural irregularity and preserve
    the finding of guilt on the ground that the appellant suffered no prejudice
    from it.

[25]

In the third Ontario case,
R. v. D.B.
, 2012 ONCA 301, as in
E. (F.E.)
the accused was excluded from
    the courtroom during his cross-examination by the Crown while counsel made
    submissions about certain questions the Crown proposed to put to him. The trial
    judge permitted some of the questions to be asked. Later, the Crown brought the
    improper exclusion of the accused to the attention of the court. Defence counsel
    did not seek a mistrial or any other remedy.

[26]

On appeal, the Crown conceded that the accused
    should not have been asked to leave the courtroom. However, the court applied
    the proviso. Doherty J.A. said, at para. 17, that the questions asked after the
    accused returned to the stand were inconsequential to the result of the trial.
    He applied
E. (F.E.)
and concluded, at para. 19, that the appellant was not in any way prejudiced
    by his relatively brief absence from the courtroom during the trial.

[27]

Against this backdrop of relevant case law over
    an extended period, I turn to the application of the governing principles to
    the facts of this case. In my view, the best path forward is to apply the six
    factors identified by Watt J.A. in
Simon
.

[28]

The first factor  whether the exclusion of the
    accused was inadvertent or deliberate  favours the Crown. The exclusion was
    surely inadvertent in the sense that all three of the trial judge, Crown
    counsel and defence counsel simply forgot about s. 650 of the
Criminal Code
. If any one of them had
    remembered s. 650, the exclusion of the appellant would not have happened.

[29]

The second factor favours the Crown. Defence
    counsel did not object to the brief exclusion of his client during his
    cross-examination.

[30]

The third factor favours the appellant. It
    appears that when he returned to the stand after his brief departure, nothing
    about the subject discussed during his absence was put on the record or reported
    to him.

[31]

The fourth factor favours the appellant. The
    discussion in the absence of the accused related to an evidentiary matter
    namely, would the Crown be allowed to ask him questions about possible sexual
    activity in his elementary school years.

[32]

The fifth factor overwhelmingly favours the
    Crown. The accused was out of the courtroom for about two minutes. The trial
    judges ruling was 100 percent in his favour; the Crown was prohibited from
    asking questions of the accused in the category he proposed.

[33]

The sixth factor also strongly favours the
    Crown. The very brief discussion in the courtroom in the absence of the accused
    and the trial judges ruling entirely in his favour had no effect on the
    conduct of the defence. Indeed, the trial judges ruling helped the defence.

[34]

Stepping back and considering these factors
    together, I conclude that they strongly support application of the proviso in
    this case. In the words of the sports community, No harm, no foul. Or, as
    expressed more elegantly by Hall J.A. in a leading case dealing with the
    proviso in British Columbia,
R. v. Bagadiong
, 2013 BCCA 538, at para. 40: a refusal to apply the curative
    provision in the present case would be a triumph of form over substance.

(2)

The
Charter
issue

[35]

The appellants alternative submission is that
    his exclusion for a portion of his trial violates ss. 7 (liberty  and the
    right not to be deprived thereof except in accordance with the principles of
    fundamental justice) and 11(d) (fair and public hearing) of the
Charter
. In making this submission, the
    appellant relies on a decision of the New Brunswick Court of Appeal,
R. v. Dedam
, 2018 NBCA 52.

[36]

In
Dedam
, the appellant was excluded from his trial on nine separate
    occasions and for a variety of reasons. As explained by Quigg J.A., at paras. 1
    and 5:

[O]n no less than
nine
occasions
    Mr. Dedam was excluded from his trial.

The occasions of exclusion can be divided into
    four types: (1) when scheduling issues were addressed in the judges chambers;
    (2) during legal arguments; (3) once when the judge and counsel engaged in a
    discussion the particulars of which are unknown; and (4) during the course of
    Mr. Dedams own testimony. [Emphasis in original.]

[37]

I note that on four of the nine occasions, the
    appellant was excluded from his trial while he was testifying.

[38]

Against this backdrop, Quigg J.A. considered relevant
    case law relating to ss. 7 and 11(d) of the
Charter
and concluded, at paras. 52 and 54:

[I]n certain instances, a violation of s.
    650(1) can amount to breaches of both ss. 7 and 11(d) of the
Charter
.
The egregious nature of some of the incidents where Mr.
    Dedam was excluded
, particularly in the course of his testifying, raises
    the violations of s. 650(1) to the level of
Charter
breaches.

In this particular case, there is no remedy
    short of setting aside the verdict and ordering a new trial that can correct
    the violations.
Mr. Dedams repeated exclusions in the

circumstances described above were egregious
. It may be that, in other circumstances, a different remedy would
    be appropriate, but that is not the case with respect to Mr. Dedam. [Emphasis
    added.]

[39]

In my view, it is not necessary to determine in
    this appeal whether there is a
Charter
route for considering the consequences of a judges exclusion of an
    accused from a portion of their trial, including, especially, during their
    testimony. I say this for two reasons.

[40]

First, the remedial framework under s.
    686(1)(b)(iv) of the
Criminal Code
is well-established and appropriate. For more than 30 years, courts
    from across the country, including the Supreme Court of Canada, this court, and
    other appellate courts, have considered the issue of a breach of s. 650 of the
Criminal Code
under the rubric of the
    proviso in s. 686 of the
Code
: see
Barrow
(1987),
Simon
(2010),
E. (F.E.)
(2011),
D.B.
(2012) and
Bagadiong
(2013)
. Resort to the
Charter
is, therefore, not necessary to fashion a remedy in appropriate
    cases.

[41]

Second, I observe that in the only case that
    applies a
Charter
ss.
    7, 11(d) and 24(1) analysis,
Dedam
, the language used to lead to a s. 24(1) result was anchored in
    observations such as: The egregious nature of some of the incidents where Mr.
    Dedam was excluded  raises the violations of s. 650(1) to the level of
Charter
breaches; Dedams repeated
    exclusions in the circumstances described above were egregious. Obviously,
    there was nothing egregious about the single brief mistake that was made during
    the appellants trial. Accordingly, it is not necessary to consider what might constitute
    a s. 7 or 11(d) breach and a s. 24(1) remedy in a different case.

E.

disposition

[42]

I would dismiss the appeal.

Released: November 22, 2021 J.C.M.

J.C.
    MacPherson J.A.

I
    agree. Janet Simmons J.A.

I
    agree.
I.V.B. Nordheimer J.A.

[1]

The events in
Barrow
took place in April 1983, which was prior to
    the 1985 enactment of the language in the current s. 686(1)(b)(iv) of the
Criminal Code
.


COURT OF APPEAL FOR ONTARIO

CITATION: Caruso v. Bortolon, 2021 ONCA 842

DATE: 20211123

DOCKET: C68970

Gillese, Trotter and Nordheimer JJ.A.

BETWEEN

Gaspare Caruso

Plaintiff (Appellant)

and

Robert Bortolon, Dean Bortolon,
    John Hanna Nissan and Martin Citron

Defendants (Respondents)

Matthew Kersten, for the appellant

Adam Jarvis, for the respondents

Heard: November 18, 2021 by
    video conference

On appeal from the order of Justice Gordon
    D. Lemon of the Superior Court of Justice, dated December 17, 2020, with
    reasons reported at 2020 ONSC 7933.

REASONS
    FOR DECISION

Introduction

[1]

The appellant commenced an action against the
    defendants alleging that they defrauded him out of shares he claimed to own in
    1947755 Ontario Limited (the company). He pleaded that Robert Bortolon
    fraudulently executed documents that stripped him of his shares on January 25,
    2017. He commenced his action more than two years later, on April 23, 2020.

[2]

The respondents defended the claim by asserting
    that the appellant was never a shareholder in the company; instead, he was a
    temporary director and was properly removed from that position on January 27,
    2017. They further pleaded that the action is statute barred:
Limitations
    Act, 2002
, S.O. 2002, c. 24, Sched. B.

[3]

The respondents successfully moved for summary
    judgment on the basis that there was no genuine issue for trial on the
    limitations issue. The appellant now challenges the fairness of the
    proceedings, the correctness of the decision to dismiss his action, and applies
    to adduce fresh evidence.

[4]

We refuse to admit the fresh evidence and we
    dismiss the appeal.

The Refusal to Grant an Adjournment

[5]

The appellant submits that the motion judge
    erred in not granting him an adjournment to file further documentation to
    demonstrate fraudulent activity on the part of the respondents in January of
    2017.

[6]

In refusing the adjournment request, the motion
    judge carefully examined the lengthy history of the proceedings leading up to
    the hearing date on November 30, 2020. The motion had already been
    adjourned a number of times. The case was ready to be argued on August 24, 2020
    but was adjourned due to a conflict of interest on the part of the appellants previous
    counsel, an issue raised by the presiding judge (not the motion judge). At that
    time, the presiding judge ordered that the parties were not permitted to file
    further materials on the motion.

[7]

The case was spoken to again on September 25,
    2020 and on October 19, 2020. On the latter occasion, new counsel for
    the appellant brought a motion to permit examinations for discovery to take
    place prior to the hearing of the motion. The request was denied. On November
    16 and 26, 2020, appellants counsel confirmed that he was prepared to proceed with
    the motion on November 30, 2020.

[8]

In light of this history, the motion judge refused
    the adjournment request. He concluded that it was necessary for the motion to
    proceed before him that day. Moreover, as the motion judge observed in his
    written reasons: The issue for the motion is not whether Mr. Caruso was
    deprived of his shares in September of 2017. The issue is whether he should
    have brought the action before it was commenced in April of 2020. The
    materials that the appellant sought to file on the day of the motion had no
    bearing on this issue.

[9]

We see no error in the motion judges decision
    to refuse an adjournment. The motion judge considered the adjournment request
    against the backdrop of the multiple proceedings between the parties and the
    previous delays. This was a discretionary decision that is entitled to
    substantial deference on appeal:
Laski v. BMO Nesbitt Burns Inc
.
,
    2020 ONCA 300, at para. 13.

[10]

This ground of appeal is dismissed.

The Action is Time-Barred

[11]

On the limitations issue, the motion judge
    reviewed the documents tendered by the parties and concluded that the
    appellants alleged injury, loss, or damage was discoverable by February of
    2017. Although the appellant swore in an affidavit that he only discovered his
    claim in 2019, the motion judge found that this evidence was undermined by the
    appellants affidavit and cross-examination in a related proceeding that
    demonstrated his awareness of his claim in February of 2017. This was supported
    by evidence of the appellants former counsel that he was retained by the
    appellant as early as February 2017.

[12]

The motion judge also considered the appellants
    failure to reply to a Request to Admit certain facts that related to the
    limitations issue. The deemed admissions arising from this failure supported
    the conclusion that the appellant was aware of his alleged injury, loss, or
    damage by February or March of 2017.

[13]

The appellant submits that the motion judge
    erred in relying on the appellants deemed admissions because he was
    self-represented when he was served with the Request to Admit. However, the
    appellant subsequently retained counsel and was represented at the hearing of
    the summary judgment motion. Counsel did not seek to withdraw the appellants
    deemed admissions, neither on consent, nor with leave of the court:
Rules
    of Civil Procedure
, R.R.O. 1990, Reg. 194, r. 51.05.

[14]

The totality of the evidence supported the
    motion judges conclusion that the action was time-barred. As of February 2017,
    the appellant was possessed of information that amounted to more than mere
    suspicion of a potential claim. Indeed, in a letter sent on his behalf on
    February 15, 2017, referring to Dean Bortolon holding himself out as the
    sole shareholder of the company, his lawyer asserted: we believe this is a
    total fraud. That the appellant may have subsequently gathered more evidence
    in support of his claim did not detract from the motion judges conclusion that
    the claim itself was discoverable in February 2017, and that it was
    time-barred. In the circumstances, there was no genuine issue for trial.

The Fresh Evidence Application

[15]

The appellant applies to adduce fresh evidence
    on appeal. In our view, this is nothing more than an attempt to circumvent the motion
    judges refusal to grant an adjournment, which we find to have been justified.
    Through proper diligence, this material could have been tendered on the summary
    judgment motion in accordance with the schedules set by other judges leading up
    to the hearing date. Moreover, this material does not bear on the correctness
    of the motion judges analysis of the limitations issue.

[16]

The application to adduce fresh evidence is dismissed.

Conclusion

[17]

The appeal is dismissed.

[18]

Given the inappropriate allegations of
    misconduct made against respondents counsel, both in the appellants affidavit
    and in his Factum, we award costs to the respondents on a substantial indemnity
    basis in the amount sought by the respondent, namely $9,000, inclusive.

E.E. Gillese
    J.A.

Gary Trotter
    J.A.

I.V.B.
    Nordheimer J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Environmental Waterproofing Inc.
    v. Huron Tract Holdings Inc., 2021 ONCA 835

DATE: 20211124

DOCKET: C69086

Gillese, Trotter and Nordheimer
    JJ.A.

BETWEEN

Environmental
    Waterproofing Inc. and Randy Wilson c.o.b. Maple Hill Electric

Plaintiffs (Respondents)

and

Huron
    Tract Holdings Inc., John D. Marshall, The Estate of Richard Lehnen,
Jake Bulk and
United Communities Credit Union

Defendants (
Appellant
)

Sean N. Zeitz, for the appellant

Martha Cook, for the respondents

Heard: November 19, 2021

On appeal from the order
    of Justice Maria V. Carroccia of the Superior Court of Justice, dated January
    12, 2021, with reasons reported at 2021 ONSC 278.

REASONS FOR DECISION

[1]

Libro Credit Union
    Limited (formerly United Communities Credit Union)
appeals
    from the order made by the motion judge in which she dismissed the appellants motion
    for a declaration that it had priority to certain funds held by the Sheriff in
    response to garnishment proceedings.

[2]

The issues between the parties arise out of
    steps that the respondents took to garnish monies that Jokey Plastics North
    America Inc. (Jokey) owed to Huron Tract Holdings Inc. (Huron). Huron
    operated a commercial real estate management company. It was placed into
    receivership. The respondents were owed monies by Huron. It discovered that
    Jokey owed monies to Huron. The respondents took garnishment steps against
    those funds pursuant to a default judgment they had obtained against Huron.

[3]

Initially, Jokey refused to pay the monies
    covered by the garnishment. About a month later, the appellant became aware of
    the garnishment steps. The appellant is a secured creditor of Huron. The
    appellant advised the respondents of its security interest and of its priority
    claim to the monies owed by Jokey.

[4]

The respondents brought a motion to require
    Jokey to pay the monies to the Sheriff pursuant to the garnishment. The motion
    came on before Gorman J., who ordered Jokey to pay certain monies to the
    Sheriff. The monies ordered to be paid to the Sheriff were the monies over
    which the appellant and the respondents had the priority dispute. Other monies
    that Jokey owed Huron were paid directly by Jokey to the appellant pursuant to
    its security interest.

[5]

The appellant then brought a motion for an order
    determining that it had the right to receive the monies that had been paid to
    the Sheriff. That motion initially came on before Garson J., who, on consent,
    adjourned it to a special hearing date and also set a schedule for the delivery
    of materials.

[6]

The appellants motion came on for hearing
    before the motion judge. At the hearing, the respondents took the position that
    the issue of priority had been determined by Gorman J. and that the appellants
    motion amounted to a collateral attack on that order. The motion judge accepted
    the respondents position and dismissed the appellants motion.

[7]

With respect, the motion judges conclusion that
    Gorman J. had determined the priority issue is simply wrong. There was no such
    determination made by Gorman J. in her endorsement, and no such determination
    appears in her order  realities that counsel for the respondents was compelled
    to acknowledge before us. Indeed, in her endorsement, Gorman J. said, in
    relation to the priority dispute, [t]his may indeed be an issue for another
    day. While the motion judge refers to this portion of the endorsement, she
    found that it does not necessarily assist in answering that question.

[8]

The simple fact is that there was never any
    determination of the priority dispute. The motion judge erred in concluding
    otherwise.

[9]

The appeal is allowed, the order of the motion
    judge is set aside, and the matter is returned to the Superior Court of Justice
    for a hearing of the priority dispute on its merits before a different judge.
    The appellant is entitled to its costs of the appeal which are fixed in the
    agreed amount of $
20,000
,
    inclusive of disbursements and HST. The appellant is entitled to its costs of
    the motion below, which were fixed by the motion judge also in the amount of $
20,000
, inclusive of disbursements and HST.

E.E. Gillese J.A.

Gary Trotter J.A.

I.V.B. Nordheimer J.A.