COURT OF APPEAL FOR ONTARIO

CITATION: Coady v. The Law Society of Upper Canada, 2015 ONCA
    876

DATE: 20151210

DOCKET: M38163

van Rensburg J.A. (In Chambers)

BETWEEN

Mary Martha Coady

Applicant

and

The Law Society of Upper Canada

Respondent

Mary Martha Coady, acting in person

Jaan E. Lilles, for the respondent

Heard: December 2, 2015

ENDORSEMENT

[1]

Martha Coady was involved in contentious discipline proceedings with the
    Law Society of Upper Canada (the Law Society) for several years. The
    proceedings resulted in findings of professional misconduct and the revocation
    of Ms. Coadys licence to practise.

[2]

In the course of her discipline proceedings before the Law Society
    Hearing Panel  in fact, on the second day of evidence in her conduct hearing
[1]

    Ms. Coady brought a motion for a stay of proceedings. She argued that the
    Hearing Panel had no jurisdiction to commence the conduct hearing because the Law
    Society failed to comply with the mandatory preconditions for a hearing, including
    obtaining the authorization of its Proceedings Authorization Committee. Based
    on this, she argues that the discipline proceeding was a nullity. I refer to
    this as the jurisdiction issue.

[3]

A stay of proceedings was refused by the Hearing Panel on February 26,
    2008. Ms. Coadys appeal of this decision to the Appeal Panel was quashed on
    motion by the Law Society on July 28, 2008. The Appeal Panel concluded that the
    appeal was not from a final decision or order within the meaning of s. 49.32 of
    the
Law Society Act
, R.S.O. 1990, c. L.8, and that it lacked
    jurisdiction to hear the appeal
.
The Appeal Panel also concluded that
    it remained open to Ms. Coady to raise the issue of jurisdiction before the
    Appeal Panel, should the Hearing Panel complete the proceedings against her and
    make findings of professional misconduct.

[4]

Ms. Coady appealed to the Divisional Court. The appeal was quashed by
    order dated October 20, 2009 (the 2009 Divisional Court Order). In his
    reasons for decision, Dambrot J., for a three judge panel, referred to s. 49.38
    of the
Law Society Act
, which provides for an appeal to the Divisional
    Court from a final decision or order of the Appeal Panel. He held that the
    Appeal Panels decision quashing the appeal of an interlocutory decision was
    itself interlocutory. As such, there was no right to appeal to the Divisional
    Court. Dambrot J. reminded Ms. Coady of the Appeal Panels conclusion that
    she could raise the issue of jurisdiction before the Appeal Panel if the
    Hearing Panel made findings of misconduct against her.

[5]

Ms. Coady decided to challenge the 2009 Divisional Court Order, and to
    pursue her jurisdiction argument before this court. She brought a motion before
    a single judge of this court, which was originally returnable November 10,
    2009. By that time, Ms. Coady had been found guilty of professional misconduct
    (on June 3, 2009), and the penalty stage of the proceedings was underway
    (resulting in the revocation of her licence on January 8, 2010).

[6]

In her November 2009 motion to this court, Ms. Coady requested leave to
    have a special case determined in the first instance by the Court of Appeal
    (purportedly under rule 22.03 of the
Rules of Civil Procedure
, R.R.O. 1990,
    Reg. 194), relying on an agreed statement of facts that was before the Hearing
    Panel in 2007. She also sought directions in respect of a motion for leave to
    appeal the 2009 Divisional Court Order. The motion also sought a stay of the
    discipline proceedings pending disposition of the motion.

[7]

The motion was not heard in November 2009, and after a number of
    adjournments, the last of which was on January 15, 2010, Ms. Coady took no
    further steps to advance her motion.

[8]

Ms. Coadys inaction in respect of the November 2009 motion is
    understandable, as by then she had continued to argue the jurisdiction issue in
    the discipline proceedings, including in her appeal to the Appeal Panel and in
    her appeal of the decision of the Appeal Panel, dated April 11, 2012, to the
    Divisional Court. Eventually, the Divisional Court dismissed her appeal (the
    2014 Divisional Court Order). Nordheimer J., for a three judge panel, determined
    the issue in his reasons for decision of December 4, 2014, dismissing Ms.
    Coadys appeal:
Coady v. Law Society of Upper Canada
, 2014 ONSC 5711,
    [2014] O.J. No. 4664, at paras. 6 to 10.

[9]

On July 28, 2015, the Registrar of this court notified Ms. Coady that
    since her November 2009 motion had not been pursued in a timely manner, the
    motion was scheduled for a hearing to determine its status on August 10, 2015.
    That day, after noting that Ms. Coady persisted in pursuing the relief sought
    in the motion, Blair J.A. refused to dismiss the motion as abandoned, and
    adjourned the motion to December 2, 2015 peremptory to Ms. Coady.

[10]

It
    is this motion, originally filed in November 2009, and seeking leave to have a
    special case determined in the first instance by this court, and directions
    for leave to appeal the 2009 Divisional Court Order, as well as other relief,
    that I must now determine.

[11]

For
    the reasons that follow, the motion is dismissed.

Motion for Court of Appeal to
    Hear a Special Case

[12]

Rule
    22 of the
Rules of Civil Procedure
provides for parties to move before
    a judge to state a special case. Rule 22.01 provides:

(1) Where the parties to a proceeding
    concur in stating a question of law in the form of a special case for the
    opinion of the court, any party may move before a judge to have the special
    case determined.

(2) Where the judge is satisfied that
    the determination of the question may dispose of all or part of the proceeding,
    substantially shorten the hearing or result in a substantial saving of costs,
    the judge may hear and determine the special case.

[13]

An
    order can only be made where the parties to the proceeding concur in stating a
    question of law in the form of a special case for the opinion of the court, and
    where the judge is satisfied that the test for leave under rule 22.01(2) is met.
    In this case, there is no agreement by the Law Society to state a case.

[14]

Ms.
    Coady relies on rule 22.03(1) which provides as follows:

A motion under rule 22.01 may be made
    to a judge of the Court of Appeal for leave to have a special case determined
    in the first instance by that court and the judge may grant leave where subrule
    22.01 (2) is satisfied and where the special case raises an issue in respect of
    which,

(a) there are conflicting decisions
    of judges in Ontario and there is no decision of an appellate court in Ontario;

(b) there is a conflict between
    decisions of an appellate court in Ontario and an appellate court of another
    province, or between decisions of appellate courts of two or more other
    provinces; or

(c) one of the parties seeks to
    establish that a decision of an appellate court in Ontario should not be
    followed.

[15]

Rule
    22.04 prescribes the form for a special case (Form 22A) which must (a) set out
    the material facts, agreed on by the parties, that are necessary to determine
    the question stated; (b) refer to and include a copy of any documents necessary
    to determine the question; (c) set out the relief sought, as agreed on by the
    parties, on the determination of the question of law; and (d) be signed by the
    lawyers for all the parties in the proceeding. No such form of special case has
    been filed in this case, as the Law Society does not agree with this procedure.

[16]

In
    her submissions, Ms. Coady makes a number of arguments directed to meeting the
    test under rule 22.03(1)(a) and (b) for determination by this court of the
    jurisdiction issue. Ms. Coady asserts that she can look directly to rule 22.03,
    as all that is required is to satisfy one of the three criteria under rule
    22.03(1) (a), (b) or (c) She argues that it is not necessary for the parties to
    agree to state a case, provided that they agree on the relevant facts, and she
    contends that it is sufficient if the parties, at some time in the past, agreed
    to certain facts. In this regard, she proposes to put the jurisdiction issue
    before this court, using the Agreed Statement of Facts signed by the parties
    before the Hearing Panel in December 2007.

[17]

Ms.
    Coady is wrong in her interpretation of the relevant rules. Rule 22 requires that
    the parties must agree to invoke the special case procedure for determination
    of a point of law. They must agree on the point of law, and they must submit
    their stated case with the elements required by the prescribed form.  These are
    the requirements for
all
special cases stated to a court, including
    this court. Only if these conditions are met may the parties move directly to
    the Court of Appeal, in which case they will need to meet the additional test
    set out in rule 22.03(1)(a), (b) or (c): see
Seed v. Delhey
(1989), 67
    O.R. (2d) 317 (C.A.)

[18]

As
    the necessary preconditions are absent, Ms. Coadys motion under rule 22 to
    state a special case to determine the jurisdiction issue is dismissed.

Motion for Directions on Leave to Appeal

[19]

Ms.
    Coady seeks directions with respect to a motion for leave to appeal the 2009
    Divisional Court Order. In particular, she asks that the motion be heard by a
    bilingual panel. There is, however, no pending motion for leave to appeal
    (which would have to be brought in writing before a three judge panel).

[20]

The
    Law Society asserts that the motion for directions should be dismissed because
    there is no pending motion for leave to appeal. Further, the Law Society argues
    that, as a result of Ms. Coadys delay and the intervening developments in her
    proceedings with the Law Society, any motion for leave to appeal the 2009
    Divisional Court Order should not be permitted to proceed.

[21]

I
    agree with the Law Societys position. As there is no pending motion for leave
    to appeal the 2009 Divisional Court Order, no directions can be given, and the
    issues raised by the proposed appeal have been overtaken by the further
    developments in the discipline proceedings. Ms. Coady attempted to litigate the
    jurisdiction issue before the Appeal Panel and then through to the Court of
    Appeal in 2009, following the refusal of a stay by the Hearing Panel in her
    discipline proceedings. The argument that the appeals to the Appeal Panel and
    to the Divisional Court ought not to have been quashed, so as to permit the
    determination of the jurisdiction issue, has been rendered moot. Ms. Coady has now
    argued the jurisdiction issue before both the Appeal Panel and the Divisional
    Court, in a final and not interlocutory context. There is simply no basis for
    any motion for leave to appeal the 2009 Divisional Court Order at this time.

[22]

In
    the course of her argument in this motion, Ms. Coady also asked that the court
    extend the time so that she can bring a motion for leave to appeal the 2014
    Divisional Court Order. The Law Society opposed the request.

[23]

The
    materials recently filed in respect of this motion disclose that Ms. Coady
    attempted to file a motion returnable November 27, 2014 for directions,
    including an extension of time for leave to appeal the 2014 Divisional Court
    Order. That motion was never scheduled and the materials were returned to her
    as deficient. Despite communications from counsel for the Law Society over the
    next several months, Ms. Coady did not take any steps to bring forth that
    motion, with the result that neither a motion for leave to appeal the 2014 Divisional
    Court Order, nor a motion to extend time to do so, is before this court.

[24]

The
    Law Society objects to any relief being granted in respect of a motion that is
    not properly before the court.

[25]

I
    am not prepared to address any request for an extension of time for leave to
    appeal the 2014 Divisional Court Order. The motion is not properly before the
    court, the record is incomplete and the question was raised only indirectly in
    response to this motion.

Disposition

[26]

For
    these reasons, Ms. Coadys motion under rule 22 and for directions in respect
    of a proposed motion for leave to appeal the 2009 Divisional Court Order is
    dismissed.

[27]

The
    Law Society is entitled to its costs of this motion. If the parties are unable
    to agree on the amount, they may exchange and file with the court within 30
    days written submissions, limited to three pages each, not including the Law
    Societys bill of costs.

K. van Rensburg J.A.

[1]

This was the second hearing panel to consider the matter. The first
    hearing began in 2002, and ended when the Hearing Panel members recused
    themselves. The new Hearing Panel was constituted in November 2007.


COURT OF APPEAL
    FOR ONTARIO

CITATION: College of Traditional Chinese Medicine
    Practitioners and Acupuncturists of Ontario v. Federation of Ontario
    Traditional Chinese Medicine Association (Committee of Traditional Chinese
    Medicine Practitioners & Acupuncturists of Ontario), 2015 ONCA 851

DATE: 20151207

DOCKET: C60110

Sharpe, Cronk and Miller JJ.A

BETWEEN

College
    of Traditional Chinese Medicine Practitioners and

Acupuncturists of Ontario

Applicant (Respondent)

and

The
    Federation of Ontario Traditional Chinese Medicine

Association,
    A. K. A the Committee of Traditional Chinese

Medicine
    Practitioners & Acupuncturists of Ontario, the

Ontario
    Acupuncture Examination Committee, the College of

Traditional
    Chinese Medicine & Pharmacology Canada, the

Canadian
    Association of Acupuncture & Traditional Chinese

Medicine,
    Committee of Certified Acupuncturists of Ontario,

James X.N. Yuan, and Jia Li

Respondents (Appellants)

Sean Hu, representative for the corporate appellants

James X.N. Yuan, acting in person

Jia Li, acting in person

Jaan Lilles and Laura
    Robinson, for the respondent College of Traditional Chinese Medicine
    Practitioners and Acupuncturists of Ontario

Zachary Green, for the intervener the Attorney General
    of Ontario

Heard: November 30, 2015

On appeal from the judgment of Justice Graeme Mew of the Superior
    Court of Justice, dated February 6, 2015, with reasons reported at 2015 ONSC
    661.

By the Court:

[1]

The appellants, individuals and corporations engaged in various
    capacities in the practice of traditional Chinese medicine, appeal the decision
    of the Superior Court granting the respondent College of Traditional Chinese
    Medicine Practitioners and Acupuncturists of Ontario (the College)
    declaratory and injunctive relief. The application judge found that the
    corporate appellants falsely held themselves out as regulatory colleges, that
    the individual appellants had wrongly held themselves out as representatives of
    the regulator, that certain of the appellants had engaged in unauthorized
    practice, and that the individual appellants had engaged in the unauthorized
    use of the protected titles Doctor or traditional Chinese medicine
    practitioner, all contrary to the
Regulated Health Professions Act
,
1991
,
    S.O. 1991, c. 18 and the
Traditional Chinese Medicine Act, 2006
, S.O.
    2006, c. 27.

[2]

In their defense to the claims of the College, the appellants submitted
    that the
Traditional Chinese Medicine Act, 2006
and, in particular the
    Registration Regulation made under that Act, were discriminatory and violated
    their s. 15
Charter
rights. The application judge rejected that defense
    on the ground that both individual appellants and one of the corporate
    appellants had previously unsuccessfully advanced essentially the same argument
    in an application before the Divisional Court: see
Yuan, Li v. Transitional
    Council of the College of Traditional Chinese Medicine Practitioners and
    Acupuncturists of Ontario
, 2014 ONSC 351, 316 O.A.C. 272 (Div. Ct.). In
    that same application, the Divisional Court also dismissed the claim that the
    College had acted unlawfully in not enacting a regulation to permit the use of
    the title Doctor in relation to the practice of traditional Chinese medicine.
    The appellants did not seek leave to appeal the Divisional Courts decision. The
    application judge held that the Divisional Court judgment barred the appellants
    from advancing the same arguments on grounds of
res judicata
, issue
    estoppel or abuse of process.

A.

Issue estoppel and abuse of process

[3]

In our view, the application judge did not err by refusing to entertain
    the appellants constitutional argument on the ground that it had been
    conclusively and finally determined against them in the prior proceeding. We
    agree with his conclusion that the required elements of issue estoppel were
    made out.

[4]

The three preconditions for issue estoppel are:

1)

the issue must be the
    same as the one decided in the prior decision;

2)

the prior judicial
    decision must have been final; and

3)

the parties to both
    proceedings must be the same or their privies.

See
Danyluk v. Ainsworth Technologies Inc
.,
    2001 SCC 44, [2001] 2 S.C.R. 460, at para. 25.

(1)

Same issue

[5]

The central argument presented to the application judge was that the
    language proficiency requirement set out in the Registration Regulation is
    discriminatory. That same argument was unsuccessfully advanced before the
    Divisional Court. The appellants contend that before the Divisional Court,
    their s. 15 argument was that the language requirement discriminated
    against all people of Chinese origin, whereas before the application judge they
    argued that the language proficiency requirement was discriminatory against
    ethnic mainland Chinese practitioners.

[6]

We agree with the application judge, at para. 52 of his reasons, that by
    reframing their argument in this manner, the appellants cannot mask the
    reality that their complaints still emanate from the linguistic requirements of
    the Registration Regulation. As pointed out in
Danyluk
, at para. 18,
    litigants are only entitled to one bite at the cherry and are required to
    put their best foot forward to establish the truth of their allegations when
    first called upon to do so. The applicable principle is that litigation is
    conclusive upon issues actually brought before the court and upon any issues
    which the parties, exercising reasonable diligence, should have brought forward
    on that occasion:
Las Vegas Strip Ltd. v. Toronto (City)
(1996), 30
    O.R. (3d) 286 (Gen. Div.), affd (1997), 32 O.R. (3d) 651 (C.A.). The
    appellants have always complained that the language proficiency requirement is
    discriminatory and they have failed to provide an adequate explanation for why
    they could not, with reasonable diligence, have advanced the same argument that
    they sought to make before the application judge in the application before the
    Divisional Court.

[7]

The appellants argue that the Divisional Court did not deal with the
    question whether the language proficiency requirement was discriminatory
    contrary to the Ontario
Human Rights Code
, R.S.O 1990, c. H.19. We
    agree with the respondent that the determination by the Divisional Court that
    the language proficiency requirement was not discriminatory under the
Charter
also answered the threshold issue of discrimination under the
Code
. It
    was not open to the appellants to re-litigate what in substance was the same
    argument by giving it a different legal label.

(2)

Final decision

[8]

The order of the Divisional Court dismissing the previous application
    was a final order. The appellants did not seek leave to appeal that order.

(3)

Same parties

[9]

The two individual appellants were parties to the Divisional Court
    proceeding as was the Federation of Ontario Traditional Chinese Medicine
    Association. All corporate appellants, except Committee of Certified
    Acupuncturists of Ontario, share the same registered address and they all share
    many of the same directors and officers, including the two individual
    appellants. In the context of these proceedings, this constitutes a sufficient
    degree of identification among the parties to make it just to hold that the
    decision to which one was a party should be binding in the proceedings to which
    the other is a party:
Re EnerNorth Industries Inc.
, 2009 ONCA 536, 96
    O.R. (3d) 1, at para. 62. In any event, even if the same parties requirement
    for issue estoppel is not strictly met, permitting the appellants to
    re-litigate the issue that was determined by the Divisional Court would amount
    to an abuse of process: see
Toronto (City) v. C.U.P.E., Local 79
, 2003
    SCC 63, [2003] 3 S.C.R. 77, at para. 37.

(4)

Discretion

[10]

Finally,
    we are not persuaded that the application judge erred by failing to exercise
    his discretion to permit the appellants to avoid the doctrines of issue
    estoppel and abuse of process. The application judge thoroughly reviewed the
    evidence and submissions of the appellants and concluded that they were simply
    re-litigating the same case before him that they had advanced before the
    Divisional Court. We agree with that conclusion and while we understand the
    appellants frustration over the effect of the Registration Regulation, we see
    no basis for permitting them to re-litigate the issue whether that Regulation
    is discriminatory.

B.

Injunction and declaratory relief

[11]

The evidence before the application judge amply supported his
    findings that the College was entitled to declaratory and injunctive relief on
    the grounds that the corporate appellants falsely held themselves out as
    regulatory colleges, that the individual appellants had wrongly held themselves
    out as representatives of the regulator, that certain of the appellants had
    engaged in unauthorized practice, and that the individual appellants had
    engaged in the unauthorized use of the protected titles Doctor or
    traditional Chinese medicine practitioner,  all contrary to the
Regulated
    Health Professions Act
, 1991

and the
Traditional Chinese Medicine Act, 2006.

C.

Disposition

[12]

Accordingly,
    the appeal is dismissed with costs to the respondent fixed at $12,500,
    inclusive of disbursements and taxes.

Released: December 7, 2015

Robert J. Sharpe
    J.A.

E.A.
    Cronk J.A.

B.W.
    Miller J.A.


WARNING

THIS IS AN APPEAL UNDER THE

CHILD AND FAMILY SERVICES ACT

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

45(7)  The court may make an order,

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

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

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

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

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

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

COURT OF APPEAL FOR ONTARIO

CITATION: D.D. v. Children's Aid Society of Toronto, 2015
    ONCA 903

DATE: 20151221

DOCKET: C60836

Laskin, Pardu and Roberts JJ.A.

BETWEEN

D.D

Respondent in Main Action

(Appellant)

and

Childrens Aid Society of Toronto

Applicant in Main Action

(Respondent)

Natasha Razack, for the appellant

Anthony Macri, for the Childrens Aid Society of Toronto

Elizabeth McCarty, for the Office of the Childrens
    Lawyer

Heard: November 24, 2015

On appeal from the judgment of Justice Carolyn J. Horkins
    of the Superior Court of Justice, dated June 30, 2015, dismissing the appeal
    from the order of Justice Carole Curtis, dated December 17, 2014, of the
    Ontario Court of Justice, granting the Childrens Aid Societys summary
    judgment motion.

Pardu J.A.:

[1]

This is the second appeal from a Crown wardship, no access order, made
    on December 17, 2014. The mother, D.D., appeals the decision to uphold the
    Order denying access to her son S.S. Her appeal from the Crown wardship order
    was dismissed as abandoned.

[2]

The facts found by the motion judge and which are not in dispute are as
    follows. S.S. is now ten years old. He has been in the care of the Childrens
    Aid Society of Toronto (the Society) for over four years. He has not seen his
    mother since February, 2014. His stated wish, as asserted through his counsel,
    is to continue not to have contact with his mother. The Society takes the same
    position: namely, that there should be no access.

[3]

The mother, D.D., was born in Romania and came to Canada in 1995. She
    worked in the adult entertainment business and as a sex trade worker. Her son,
    S.S., was born August 15, 2005. The father was D.D.s client; they were not
    involved in a romantic relationship and the father currently has no contact
    with the child.

[4]

The child has been in the Society's care and custody since July 19, 2011
    when D.D. voluntarily placed him in care under a Temporary Care Agreement. She
    was experiencing mental health issues, including anxiety and some homicidal
    ideation, and there was a concern that she might harm herself or the child. The
    Temporary Care Agreement was extended to May 12, 2012 on consent.

[5]

After the childs admission into care, D.D. had phone access with him
    until April 2012 when the child asked that the phone calls cease. D.D.
    continued to have access visits with her son. In June 2012, the Society
    commenced a protection application. On December 17, 2012, the parties consented
    to a finding that the child was in need of protection pursuant to s.
    37(2)(b)(i) of the
Child and Family Services Act
, R.S.O. 1990,
    c. C.11 (the
CFSA
). The child was made a Society ward for a
    period of four months with access at the Society's discretion. Access visits
    continued and S.S. expressed a desire to visit with his mother. However, as of
    April 2013, at the childs request, visits occurred only at the Societys
    office, and not at D.D.s home.

[6]

The Society observed positive interactions between D.D. and S.S.
    However, the child consistently responded negatively to the idea that he might
    be returned to his mother and stated explicitly that he did not wish to be
    returned to her. He also demonstrated certain troubling behaviour after some
    visits  soiling the bed, becoming unfocused and disruptive at school, and
    having difficulty sleeping.

[7]

A number of mental health professionals were involved to try and address
    the childs needs and identify the supports that would be required for
    reintegration with D.D. Dr. Fitzgerald assessed S.S.; he commented that the
    child was clear that he did not want to return to his mother's home, although
    he did want to continue access visits. Ms. Cowan-Levine, a psychotherapist,
    also indicated that S.S. was very consistent in his belief that it was not safe
    for him to go home. Another therapist, Ms. Mulligan, raised the possibility of
    doing a joint meeting with D.D. and S.S., but after S.S. responded negatively
    to this idea, she stated that she could not recommend proceeding with such
    treatment.

[8]

In or around December 2013, S.S. disclosed to Ms. Cowan-Levine that he
    was regularly hit by his mother, tied to a bed to have his mouth washed out with
    soap, and made to kneel in a corner for a long period of time. As a result, as
    of December 10, 2013, access was suspended while the police and Society
    investigated. On December 17, 2013, D.D. nevertheless visited S.S.s school and
    gave him Christmas presents (as well as a note with her contact information on
    it). This event apparently upset the child a great deal; he reported that he
    was scared his mother would take him away and that he did not feel safe. He
    reiterated that he only wished to have supervised visits with his mother at the
    Societys office.

[9]

After this investigation in December 2013, D.D.s access was resumed,
    but visits were again suspended after S.S. alleged he had been sexually abused
    with his mothers knowledge and while in her care. As a result, D.D. has not
    seen S.S. since February 18, 2014. No charges were laid in relation to the
    allegations or physical or sexual abuse. There was evidence from Ms. Cowan-Levine
    that the childs behaviour has improved since visits with his mother stopped
    and his last report card (as of the appeal judges decision) showed an A
    average. He expressed that he no longer wished to have access with his mother,
    supervised or not.

[10]

In
    February 2014, the Society brought an application to make S.S. a Crown ward in
    the care and custody of the Society without access. In its view, if D.D. were
    granted access, it would adversely affect the childs prospects for adoption.
    The Society then brought a motion for summary judgment. Prior to the summary
    judgment hearing, D.D. brought a motion for access in January 2014, but
    withdrew it in May 2014 after being told that it was against her sons wishes. In
    neither proceeding did she seek the return of S.S. to her care.

A.

The motion judges reasons

[11]

At
    the hearing before the motion judge, the appellant did not seek an order for
    specific access. She requested an order that was silent as to access so that if
    at some point her son wanted to see her, he would be able to do so.

[12]

After
    granting the Societys request to make S.S. a Crown ward, the motion judge
    correctly set forth the applicable test from section 59(2.1) of the
CFSA
for determining whether to grant access. The onus is on the person seeking
    access to a Crown ward to prove on the balance of probabilities that the
    relationship between the person and the child is meaningful to the child, the
    relationship between the person and the child is beneficial to the child, and
    that access will not impair the childs future opportunities for a permanent or
    stable placement.

[13]

She
    noted that there is a presumption against access to a Crown ward, and that
    access is the exception and not the rule in this context.

[14]

Referring
    to
Childrens Aid Society of Niagara v. M.J.
, [2004] and the section
    59(2.1) of the
CFSA
, she commented as follows:

In this decision the Court looked at the standard dictionary
    definitions: a beneficial relationship is one that is advantageous, a
    meaningful relationship is one that is significant. Even if there are some
    positive aspects to the relationship between the parent and the child that is
    not enough, it must be significantly advantageous to the child.

The section speaks of an existing relationship between the
    person seeking access and the child, not a future relationship. That is
    important because it precludes the Court from considering whether a parent
    might cure her parental shortcomings so as to create in time a relationship
    that is beneficial and meaningful to the child. This accords with common sense,
    for the child is not expected to wait while his mother learns how to be a
    responsible parent. The test focuses on the childs experience of the
    relationship, not the parents, in the assessment of whether it is beneficial
    and meaningful. The
Childrens Aid Society of Hamilton v. L.S.
, [2011]
    decision in the Superior Court.

[15]

The
    motion judge reviewed the history of the mothers access with her son, and the
    disturbances to his emotional well-being that resulted. There was no ongoing
    access and the motion judge concluded that the results of a trial on the issue
    of access would be a foregone conclusion. She then ordered Crown wardship with
    no access.

[16]

The
    appeal judge agreed with the motion judges conclusions.

B.

D.D.s position ON THIS APPEAL

[17]

D.D.
    submits that the appeal judge erred in failing to identify reversible errors
    made by the motion judge.

[18]

First,
    she submits that the motion judge erred by not considering how the interruption
    of the parent-child relationship, which was instigated by the Society due to
    unproven allegations of sexual abuse in February 2014, affected the beneficial
    and meaningful bond between her and her son.

[19]

Second,
    D.D. contends that the motion judge erred in not considering that S.S.
    continued to request access to D.D. up to March 2014. Courts can consider
    granting access through cards or letters, as opposed to in-person visits, which
    has been recognized as beneficial to the child insofar as it allows the child
    to maintain some connection to the biological parent.

[20]

Third,
    she argues that it was an error not to recognize the positive steps D.D. has
    taken to improve her parenting skills after her mental health issues were
    addressed, to seek out better employment opportunities, and to acquire suitable
    housing for her child.

[21]

Lastly,
    D.D. submits that the motion judge gave too much weight to hearsay evidence of
    professionals, and to the childs report of abuse. On March 3, 2014, S.S.
    stated that his mother bribed him to have sexual acts with her clients. D.D.s
    response to the Society was that the child was not telling the truth. He elaborated
    upon this on March 14, 2014 in an interview with a detective at the Societys
    office:

a. [S.S.] disclosed that when he was in his mothers care that
    one day a man come into their home. He stated that the apartment door was
    unlocked and the man came in. He stated that the man came to his room as he
    heard the door of his room opening. He got scared and went under the bed. He
    said that he was shivering, nervous and scared. He saw the man through the
    crack under his bed. He stated that the man told him to get up and come with
    him.

b. He started following the man out of his room but he stated
    that when he got out of his room he ran to his moms room, woke her up and told
    her that there was a man in the apartment. His mom told him to go back and do
    whatever the man told him to do. She told him if he did then he would get
    cars/toys. He said he got nervous but went back into the living room where the
    man was.

c. The man took [off] his pants, he was not wearing underwear
    and he told [S.S.] to lick and touch his private part. [S.S.] stated that he
    licked him, and then he touched the man with his finger and then ran to the
    washroom to wash his hands because he did not want germs. Lori asked how it
    felt and he stated it felt a little hard. [S.S.] said that he washed the
    germs off his hands because he felt the yuckiness on his hand. He stated that
    his hand felt kinda greasy.

d. Lori confirmed with [S.S.] several times that his mom had
    told him that he needed to do whatever the man said and he would get toys.
    [S.S.] said that his mom did not follow through giving him the toys, however,
    but he stated that he thinks that he knew that she was lying and knew that
    she would never give him the toys.

e. [S.S.] said that when his mom told him to go and do whatever
    the man told him to do he agreed but he thought that the man would make him
    kneel on his knees like how his mom would do when she would punish him.

f. [S.S.] knew the time of the day this occurred and stated it
    was 11:29 pm, because when he was walking out of the room he clock changed from
    11:28 pm to 11:29 pm.

g. The man also told him to take his pants off and lay down.
    [S.S.] stated that he had his underwear on and that the man just looked at him
    and stared at the clock then left.

h. [S.S.] stated that the man was black, in a black suit, black
    sweater and long sleeve black shirt, and that his hair was darkish brown. He
    stated further that the man had a scratch on his nose and pimple on his face.
    He stated that his eyes were dark brown, super dark brown, and almost looked
    weird.

i. [S.S.] stated he didnt know the mans name.

j. [S.S.] stated that when the man left [S.S.] locked the door
    and went back to bed.

k. The next morning, he said that it was just as normal, he did
    not say anything to his mom. When asked why he did not say anything to her, he
    said, because she already knew that the man was there because he told her.

[22]

At
    the same time the child reported comments made by his mother during an access
    visit:

[S.S.] also disclosed that during [an] access visit at the
    Society office that when the worker went to use the washroom his mother
    whispered in his ears that she is going to get a cord, wrap it around her neck
    and hang herself. He stated that it happened in access room 7. He stated that
    he didnt believe her because he didnt think that she really wanted to hurt
    herself. She told him to keep it a secret. This incident took place before the
    first interview meeting with Lori.

[23]

The
    appellants response to the Society was that her son was not telling the truth.

[24]

The
    childs therapist reported:

[S.S.] has spoken consistently of the turmoil inside of him,
    fueled by his enormous anxiety in the presence of his mother, and the
    containment of the many details surrounding his sexual abuse. Sleep
    disturbance, inability to concentrate, and some increasing non-compliance were
    behavioural indicators of the turmoil in [S.S.] as he struggled with thoughts
    of the past and uncertainties of the future.  As visits with [S.S.]s mother
    reduced, and then access, even supervised access was stopped, the emotional
    tornado inside [S.S.] diminished.  [S.S.]s fears of retaliation from his
    mother, even without access, continues; e.g. Finding him at school at recess
    (which did occur), hearing details in court, learning where he currently
    resides, all becoming so concerning that arrangements were made for [S.S.] to
    have only indoor recess at school.

[25]

In
    light of these errors, the appellant submits that there was a triable issue as to
    whether D.D. should be given access to S.S.

C.

THe POSITION OF THE SOCIETY AND THE OCL ON APPEAL

[26]

Both
    the Society and the OCL take the position on appeal that the appeal should be
    dismissed. The order of Crown wardship without access should be upheld to allow
    S.S. to move forward towards a permanent placement. Given the childs
    consistent fear and anxiety over any contact with his mother, they take the
    position that there was no triable issue as to whether any access order would
    have been beneficial and meaningful to him.

D.

Analysis

(1)

Standard of Review

[27]

In
Van de Perre v. Edwards
, 2001 SCC 60, [2001] 2 S.C.R. 1014, the Supreme
    Court of Canada noted at para. 13 the high standard of review for cases
    involving child custody:

Finality is a significant consideration in child custody cases,
    maybe more so than in support cases, and reinforces deference to the trial
    judge's decision an appellate court may only intervene in the decision of a
    trial judge if he or she erred in law or made a material error in the
    appreciation of the facts.

[28]

In
    that case, the Supreme Court also adopted for child custody appeals its
    comments in
Hickey v. Hickey
, [1999] 2 S.C.R. 518 at para. 12 that an
    appeal court is not entitled to intervene, simply because it would have made
    a different decision or balanced the factors differently.

[29]

This
    court has noted that deference is particularly compelling in child protection
    cases. As Justice Gillese noted at para. 19 of
Childrens Aid Society of
    Ottawa v. S.N.-D.
, 2012 ONCA 590, This court owes deference to factual
    determinations, a consideration that is particularly compelling in child
    protection proceedings.

[30]

See
    also
Children's Aid Society of Toronto v. V. L.,
2012 ONCA 890 at
    para. 16: the degree of deference owed to the trial judge is particularly
    high in child protection proceedings.

(2)

Focus on the Child

[31]

Section
    59(2.1) of the
CFSA
clearly places the focus of the test for access on
    the childs perspective.

[32]

The
    mothers arguments that the Society was responsible for interruptions in her
    contact with S.S., that she did made requests for access, and that her
    parenting skills had improved, focus on the
reasons
for the current
    state of affairs and on the mothers efforts. They do not speak directly to
    whether access would be meaningful and beneficial to the child.

[33]

Accordingly,
    the motion judge was correct to focus on the childs present best interests.

(3)

Hearsay Evidence

[34]

Contrary
    to the appellants position, not all hearsay evidence is inadmissible. The
    question is whether the motion judge relied inappropriately on hearsay
    evidence. In my view, she did not.

[35]

The
Family Law Rules
expressly contemplate the use of hearsay evidence on
    a motion for summary judgement. Section 16(5) provides that if a partys
    evidence is not from a person who has personal knowledge of the facts in
    dispute, the court may draw conclusions unfavourable to the party.

[36]

Further,
    s. 50 of the
CFSA
expressly contemplates the admission of written
    reports of therapists and other persons involved in the childs care:

Despite anything in the
Evidence Act
, in any
    proceeding under this Part [child protection],

(a) the court may consider the past conduct of a
    person toward any child if that person is caring for or has access to or may
    care for or have access to a child who is the subject of the proceeding; and

b) any oral or written statement or report that
    the court considers relevant to the proceeding, including a transcript, exhibit
    or finding or the reasons for a decision in an earlier civil or criminal
    proceeding, is admissible into evidence.

[37]

Evidence
    about a childs expressed views is often presented through persons to whom the
    child has communicated. Section 39(5) of the
CFSA
provides that a
    child under 12 is not entitled to attend court unless the court is satisfied
    the child can understand the proceedings and will not suffer emotional harm.

[38]

Statements
    about the childs views and preferences set out in affidavits by Childrens Aid
    Society workers affidavits are admissible:
Strobridge v. Strobridge
(1992), 10 O.R. (3d) 540 (ONSC).

[39]

Statements
    that show the childs state of mind are also admissible as a general exception
    to the hearsay rule where they are admitted not for their truth but for the
    fact that they were said: Paciocco and Stuesser,
The Law of Evidence
,
    5th Ed. at p.176. Here, many of the complained-of hearsay statements were considered
    by the motion judge in this context.

[40]

In
    addition, while in some cases, admission of hearsay might be unfair, here the
    mother does not point to any particular unfairness resulting from the admission
    of the evidence presented on the motion. It does not appear that she made any
    objection to that evidence at the hearing or asked to cross examine the
    deponents of the affidavits.

(4)

Conclusions

[41]

Here,
    the appeal judge did not err in determining that the motion judge appropriately
    focused on the present best interests of the child and did not over-emphasize
    the hearsay reports of what the child and his therapist said. Essentially the
    motion judge concluded that the mother did not have an ongoing relationship
    with the child and that access should not be granted on the basis of the future
    hope of a beneficial relationship. Given the childs unwillingness to have
    contact with his mother, the motion judge did not err in concluding that there
    was no triable issue as to whether ordering access to the mother would be
    meaningful and beneficial for the child.

[42]

As
    this court pointed out in
Childrens Aid Society of Niagara Region v. C.J.
,
    2015 ONCA 695:

In order to satisfy the first requirement, the party seeking
    access must prove, on a balance of probabilities, that his existing
    relationship with the child brings a significant positive advantage to the
    child. It is not sufficient that there are some positive aspects to the
    relationship.

[43]

I
    am not satisfied that the mothers present proposal, to send birthday and Christmas
    cards to the child would bring a significant positive advantage to the child.

[44]

I
    recognize that the childs expressed wishes to have no contact with his mother
    have lasted about 21 months and that he might change his mind. If that happens,
    s. 59(4) of the
CFSA
allows the Society to facilitate contact between
    the child and his mother:

If a society believes that contact or communication
    between a person and a Crown ward is in the best interests of the Crown ward
    and no openness order under Part VII or access order is in effect with respect
    to the person and the Crown ward, the society may permit contact or
    communication between the person and the Crown ward.

[45]

This
    would allow the mother to send cards intended for her son to the Society, which
    could assess whether receipt of these communications would be beneficial for
    the child. The mother has not attempted any such communications in the last 21
    months that there has been no access.

[46]

In
    addition, at any time before an adoption order is made, the Society may apply
    for an openness order allowing a parent access to a child, despite the Crown
    wardship. (Section 145.1 (1)
CFSA
).

[47]

A
    court may make such an order if satisfied that:

(a) the openness order is in the best interests of
    the child;

(b) the openness order will permit the continuation
    of a relationship with a person that is beneficial and meaningful to the child
    (s. 145.1.2(6)
CFSA
)

[48]

If
    the child is placed for adoption, any order made by the motion judge for access
    would terminate. If the mother had been granted access, she would be entitled
    to notice of the placement for adoption, that the access order terminated upon
    such placement, and that she could apply for an openness order within 30 days. This
    would mean re-litigation of the same issues that were before the motion judge.
    Like s. 59(2.1), s. 145.1.2(6) contemplates an
existing
relationship
    that is beneficial and meaningful to the child.

[49]

The
    prospect of further litigation may deter prospective adoptive parents. As
    pointed out in
Catholic Childrens Aid Society of Toronto v. L.D.E
,
    2012 ONCJ 530, there are many ways in which an outstanding openness application
    could derail an adoption by prospective adoptive parents:

a. They would be facing further litigation;

b. They would not know the result of such litigation;

c. They would not know what form an openness order might take;

d. If an openness application is brought, the adoption will be
    delayed.

[50]

The
    child has not seen his mother for over 21 months. That is a very long time in
    the life of this child. The motion judge did not err in concluding that the
    mother had not met the test in s. 59(2.1) to establish that her existing
    relationship with the child was beneficial and meaningful to the child

[51]

I
    also note that fresh evidence filed on the appeal demonstrates that the child
    is very worried about his present limbo. He continues in therapy. He is worried
    he will be too old to be adopted. When asked what was on his Christmas list he
    responded, Nothing you dont know about. We just talked about it: adoption, a computer
    and a mom and dad of my own to love me. This child has now been in care for four
    years. A secure placement for adoption, as soon as possible, is essential to
    advance his best interests.

[52]

Accordingly,
    the appeal from the refusal of the motion judge to grant access or order a
    trial of the issue of access is dismissed.

Released: (GP) December 21, 2015

G. Pardu J.A.

I agree John Laskin
    J.A.

I agree L.B. Roberts
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Daverne v. John Switzer Fuels Ltd., 2015 ONCA 919

DATE: 20151224

DOCKET: C60365

Hoy A.C.J.O., MacFarland and Lauwers JJ.A.

BETWEEN

Gerald Daverne and Jutta Daverne

Plaintiffs

and

John Switzer Fuels Ltd., Brian Lasher, Glenn
    Lasher Home Comfort Service,
McKeown & Wood Limited
and Parrsboro
    Metal Fabricators Ltd.

Defendants (
Respondent
)

and

AON Reed Stenhouse Inc.,
Federated Insurance
    Company of Canada
, GCAN Insurance Company, Aviva Insurance Company of
    Canada and Chartis Insurance Company of Canada (formerly American Home
    Assurance Company

Third
    Parties (
Appellant
)

Andrew A. Evangelista and Avi Cole, for the appellant

John A. Ryder-Burbidge, for the respondent

Heard: November 2, 2015

On appeal from the decision of Justice Graeme Mew of the Superior
    Court of Justice, dated March 31, 2015, with reasons reported at 2015 ONSC 1803.

LAUWERS J.A.:

[1]

The motion judge
    granted partial summary judgment in the third party action to the respondent
    insured, McKeown & Wood Limited and declared that the appellant insurer,
    Federated Insurance Company of Canada, has a duty to defend McKeown & Wood
    in the main action. The motion judge dismissed Federateds cross-
motion for summary judgment to dismiss the
    third party action against it based on the contractual limitation period in
    Federateds insurance policy. I would allow the appeal for the following
    reasons.

A.

THE FACTUAL BACKGROUND

[2]

The main action
    arises out of a fuel oil leak from a fuel tank that caused damage to the Davernes
    property. McKeown & Wood sold the fuel tank to the Davernes in 2000.

[3]

Sometime after
    the date of the last fuel delivery on January 9, 2008, the fuel tank began to
    leak. The Davernes discovered the leak and resulting damage on returning home
    from vacation in late January. They started the main action against McKeown
    & Wood and others on December 31, 2009, seeking compensation for the damage
    to their home and the additional living expenses that they incurred as a result
    of the leak.

[4]

Federated insured
    McKeown & Wood from at least 1999 until the expiry of the last policy on
    October 24, 2007, a few months before the leak. On February 11, 2010, McKeown
    & Wood advised Federated of the Davernes claim, having been served with
    the Notice of Action and Statement of Claim in the main action a few days
    before. By letter dated April 9, 2010, Federated denied coverage, stating:

As the occurrences occurred in
    January 2008, Federated Insurance will not be able to assist you with this
    claim. We did not insure McKeown and Wood Limited on the date of loss.

[5]

McKeown &
    Wood defended the main action, bearing its own legal costs, and brought a third
    party action against a number of insurers, including Federated, on March 15,
    2012.

B.

THE DECISION BELOW

[6]

The motion judge
    first addressed Federateds argument that a contractual limitation period in
    the insurance policy applied and the third party action was out of time, at
    paras. 24 to 57. He found that the contractual limitation period was
    unenforceable.

[7]

The motion judge
    then addressed Federateds argument that it did not have a duty to defend
    McKeown & Wood in the main action, at paras. 58 to 73. Federated asserted
    that the date of the occurrence for determining the date of loss happened
    after the policy expired. The motion judge disagreed, on the basis that the
    corrosion to the oil tank that led to the leak could itself be property
    damage covered under the insurance policy. He found, at para. 68, that the
    mere possibility is sufficient to trigger Federateds duty to defend.

[8]

The motion judge also
    rejected Federateds argument that the exclusion of coverage to damage to the
    oil tank, known as the your product exclusion, meant that there could be no
    coverage for property damage to the tank. He found, at para. 72, that the
    allegations in the Davernes Statement of Claim were broader, so that the
    application of the exclusion would be a matter for the trial judge to
    determine.

C.

THE ISSUES

[9]

This appeal
    raises three issues:

1)

What is the
    standard of review applicable to the motion judges interpretation of the
    policy?

2)

Did the motion
    judge err in finding that the one-year limitation period set out in Federateds
    insurance policy was not enforceable against the insured McKeown & Wood?

3)

If the one-year
    limitation period is not enforceable, did the motion judge err in his approach
    to ascertaining whether Federated owed McKeown & Wood a duty to defend the
    main action under the insurance policy?

D.

ANALYSIS

[10]

On the first issue, the standard of review applicable to the motion
    judges interpretation of the insurance policy is correctness. On the second
    issue, t
he motion
    judge erred in concluding that the one-year limitation period in the policy is
    not enforceable. It is therefore not necessary to address the third issue.

1)

The standard of review
    is correctness

[11]

In response to a
    question from the bench, the appellant took the position that the
    interpretation and application of the insurance policy falls into the
    deferential standard of appellate review demanded by
Sattva Capital Corp.
    v. Creston Moly Corp
.
, 2014 SCC
    53, [2014] 2 S.C.R. 633. Counsel for the appellant submitted that he had
    nevertheless shown reversible error, even on a deferential standard.

[12]

Since this appeal
    was heard, this court has determined that the correctness standard of review
    applies on standard form insurance contracts:
MacDonald v. Chicago Title
    Insurance Company of Canada
, 2015 ONCA 842 at para. 41.

As Hourigan J.A.
    observed
. 40: It
    is untenable for standard form insurance policy wording to be given one meaning
    by one trial judge and another by a different trial judge. This followed his
    comment, at para. 38, that: there is an important public policy argument
    that supports the adoption of a correctness standard for appeals involving the
    interpretation of standard form contracts.

[13]

In the case of insurance
    policies, which involve the interpretation of similar if not common language
    and the application of general principles of insurance law, the high degree of
    generality and precedential value justifies a departure from the deferential standard
    of appellate review.

[14]

Accordingly, correctness is the standard of review applicable to the
    motion judges interpretation of the insurance policy. Further, as I will
    explain below, several of the motion judges errors fall within the reviewable legal
    errors listed by Rothstein J. in
Sattva
, at para 53.

2)
    The one-year limitation period in the policy is enforceable

[15]

In my view, the
    contractual limitation period is enforceable and McKeown & Woods third
    party claim for a declaration that Federated owes it a duty to defend the main
    action should be dismissed.

(a) The limitation period in the policy

[16]

Section 148 of
    the
Insurance Act
, R.S.O. 1990, c. I.8, makes certain
    statutory conditions part of every fire insurance contract in Ontario. Statutory
    condition 14 is included in Federateds policy as clause 14 of the Basic
    Policy Statutory Conditions form that is included in the Basic Policy. It
    provides:

14.

Action:

Every action or proceeding against the insurer for the
    recovery of any claim under or by virtue of this contract is absolutely barred
    unless commenced within one year next after the
loss
    or damage
occurs. [Emphasis added.]

[17]

Clause 8 of the
    Additional Conditions of the Basic Policy form also applies:

8.

Applicability
    of Statutory Conditions and Additional Conditions
: The
Statutory
    Conditions
and Additional conditions
apply with respect
to all the
    perils insured by this policy
and to the liability coverage
, where
    provided, except where these conditions may be modified or supplemented by
    riders or endorsements attached. [Emphasis added.]

Clause
    8 applies the contractual limitations period in clause 14 to the other perils
    insured against in Federateds policy

and to the liability coverage provided by it.

(b) The policy
    is a business agreement

[18]

The
Limitations
    Act, 2002
, S.O. 2002, c. 24, Sch. B came into force on January 1, 2004. It
    introduced a general limitation period of two years, subject to the
    discoverability principle, for all claims other than those listed in Schedule A
    thereto. As the motion judge noted, at para. 28, s. 148 of the
Insurance
    Act
, which sets out statutory condition 14, is listed in Schedule A, and therefore
    remains in effect.

[19]

Section 22(1) of
    the
Limitations Act,
    2002
prohibited
    contracting out of a limitation period it established, apart from certain
    grandfathered exceptions permitted in ss. 22(2). By amendments to s. 22 that
    came into force on October 19, 2006, an exception to the "no contracting
    out" rule was permitted in the case of "business agreements"
    entered into on or after that date:
Legislation Act, 2006
, S.O. 2006,
    c. 21, Sch. F, s. 9(1). Subsections 22(5)-(6) were added to the
Limitations
    Act
, 2002
, and provide:

(5)  The
    following exceptions apply only in respect of business agreements:

1. A limitation period under this
    Act, other than one established by section 15, may be varied or excluded by an
    agreement made on or after October 19, 2006.

2. A limitation period established by
    section 15 may be varied by an agreement made on or after October 19, 2006,
    except that it may be suspended or extended only in accordance with subsection
    (4).

(6)  In
    this section,

business agreement means an agreement made by parties none of
    whom is a consumer as defined in the
Consumer Protection Act, 2002
;

vary includes extend, shorten and suspend.

[20]

But for the
    amendments adding ss. 22(5)-(6), the shorter limitation period in statutory
    condition 14 would only apply to the fire insurance elements of Federateds
    policy, because its application to the other coverage in the policy would have
    conflicted with the "no contracting out" rule in s. 22(1).

[21]

It is plain that
    none of the parties to Federateds insurance policy is a consumer, which is defined
    in the
Consumer Protection Act, 2002
to mean an individual acting for
    personal, family or household purposes and does not include a person who is
    acting for business purposes. The parties are business entities.

[22]

The motion judge
    acknowledged, at para. 29, this courts holding that an insurance policy
    covering various risks related to the operation of an insureds business fell
    within the definition of business agreement:
Boyce v. Co-Operators
    General Insurance Co
.
, 2013 ONCA
    298, 116 O.R. (3d) 56. If the policy is a business agreement within the
    definition in s. 22(6) of the
Limitations Act, 2002
, it is capable of
    overriding the otherwise applicable two-year limitation period.

(c)

The policy over-rides the statutory two-year limitation
    period

[23]

In my view,
    clause 14 of the Basic Policy Statutory Conditions, combined with clause 8 of
    the Additional Conditions, clearly varies the two-year limitation period
    provided for in the
Limitations
    Act, 2002
. In
Boyce
, this court found that nearly
    identical contractual limitation period language overrode the otherwise
    applicable statutory two-year limitation period.

[24]

The motion judge
    concluded otherwise, interpreting the phrase loss or damage in clause 14 as
    not including loss or damage suffered by a third party, such as the Davernes,
    who then seeks compensation from the insured. The motion judge, at para. 43,
    distinguished
Boyce
and the earlier decision of this
    court in
International Movie Conversions Ltd. v. ITT Hartford Canada
(2002), 57 O.R. (3d) 652, as cases dealing with first party claims against an
    insurer, rather than third party coverage such as the case here. I would not
    agree with the motion judge that the difference is a relevant basis on which to
    distinguish
Boyce
.

[25]

The motion judge
    found that applying clause 14 of the Statutory Conditions to the commercial
    general liability coverage creates an anomalous consequence and results in
    ambiguity. That ambiguity, he found at para. 54, should be resolved in favour
    of the person whose right is being truncated: citing
Berardinelli v.
    Ontario Housing Corp
.
, [1979] 1
    S.C.R. 275. Accordingly, he concluded that the policy did not over-ride the
    statutory two-year limitation period.

[26]

As I will
    explain, in interpreting the phrase loss or damage the motion judge was
    guided by inapplicable jurisprudence and failed to apply relevant
    jurisprudence. His interpretation was therefore based on incorrect principles.
    Further, the motion judge failed to give effect to the particular language at
    issue, namely clause 8 of the Additional Conditions, which specifically provides
    that clause 14 applies to the liability coverage under the policy. Therefore,
    even if his interpretation of the policy were owed deference, his interpretation
    cannot stand.

(d) Interpretation guided by inapplicable
    jurisprudence

[27]

The
    motion judge held, at para. 45, the phrase loss or damage, as used in clause
    14 and other places in the statutory conditions, is not readily adaptable to
    liability insurance coverage where the loss or damage which is the subject of a
    claim has been suffered by a third party who then seeks compensation from the
    insured: citing
Walker
    v. Sovereign General Insurance Company
, 2011 ONCA 597.
With respect, this is not the holding
    in
Walker
.

[28]

Walker
involved a direct action by a slip
    and fall victim against the insurer of the bankrupt business that owned the
    property on which the accident occurred. The insurance policy contained
    language applying the statutory conditions to the other perils. The statutory
    conditions were, however, subordinate to the policy conditions. The notice
    provision in statutory condition 8 required notice to be given to the insurer by
    a person to whom a part of the insurance money is payable, while the notice
    provision in the policy conditions allowed it to be given be given promptly by
    or for the Insured to the Insurer or any of its authorized agents. This court
    ruled that the latter prevailed in light of the policy language. The owner of
    the plaza had provided notice to the insurer in light of the tenants
    bankruptcy. This court found that adequate notice had been given.

[29]

There is no
    similar competition between different provisions of the insurance policy in
    this case. In my view,
Walker
is not applicable to this case. Moreover,
    the policy under consideration in
Walker
did not contain a provision comparable to clause 8 of the Additional
    Conditions in the policy at issue, which specifically provides that clause 14
    applies to the liability coverage under the policy.

[30]

The
    motion judge continued, at para. 53, and held that
KP Pacific Holdings Ltd. v. Guardian
    Insurance Co. of Canada
, 2003 SCC 25, stood for the proposition that: the
    statutory conditions, and in particular a limitation provision designed for
    first party claims, cannot be shoehorned into a policys commercial liability
    insurance coverage without contrived reconstruction and anomalous consequences.
    This, with respect, is not the relevant holding in

KP Pacific Holdings
.
In that case the insured was seeking
    coverage for a fire loss. Under the Part 5 fire insurance section of the
    British Columbia
Insurance
    Act
,
    it was out of time, but not under Part 2, the section of general application.
    Chief Justice McLachlin concluded, at para. 19:

I cannot conclude either from the language of s. 119 or its
    history that the Legislature intended a multi-risk policy such as this one to
    fall within Part 5 with all the attendant consequences, including a shortened
    limitation period. It follows that this policy, like any other policy that does
    not fit into a specific category, is governed by Part 2, the section of general
    application.

[31]

This,
    she noted, at para 20, may not represent the ideal solution for multi-risk
    comprehensive policies. In setting the context for the interpretation exercise,
    McLachlin C.J.C. gave a general critique of the B.C.
Insurance Act
, which dates from
    1925. She said that its structure was outmoded, and constituted a
tangled historical thicket. By
    contrast, the relatively recent language of the
Limitations Act, 2002
and its permission for business agreements does not raise the same problems
    of interpretation and application.
In my view
    the ruling in
KP Pacific Holdings

offers no guidance applicable to this
    case.

(e) Failure to
    apply relevant jurisprudence

[32]

The motion judge erred in rejecting
    Federateds argument that its denial of defence coverage to McKeown & Wood
    could constitute loss or damage for the purpose of the limitation period in
    clause 14.

[33]

There is no
    reason not to apply the basic principle that the insured suffers a loss from
    the moment [the insurer] can be said to have failed to satisfy its legal
    obligation [under the policy of insurance]. Where the benefit of a duty to
    defend is denied, the insured suffers a loss caused by the insurers denial
    of a defence the day after the demand  is made:
Schmitz v. Lombard
    General Insurance Co
.
, 2014 ONCA
    88
,
at para. 20;

Markel Insurance Co. of Canada v. ING
    Insurance Co. of Canada
, 2012 ONCA 218, 109 O.R. (3d) 652, at para. 27.

[34]

I do not agree
    with the motion judge that
Schmitz
can be distinguished on the basis
    that it involved a first party claim for indemnity under an OPCF 44R (uninsured
    motorist coverage) endorsement, and not a third party claim for defence, as in
    this case. The point of distinction does not affect the application of the
    principle that the insured suffers a loss when the insurer fails to meet its
    legal obligation under the policy.

(f
)
    Failure to give effect to clause 8 of the Additional Conditions

[35]

Although the
    motion judge noted, at para. 37, that clause 8 of the Additional Conditions
    expressly purports to extend the application of the statutory conditions and
    additional conditions to the
liability
coverage,
    he failed to consider the effect of this clause, relying on this courts
    decision in
Walker
, despite acknowledging that the policy under
    consideration in that case did not contain a comparable provision.

(g) The policy is clear and unambiguous

[36]

In
Boyce,
this court considered virtually the
    same contractual language as clause 8 and found, at para. 12, that the policy,
    like the policy in
International Movie Conversions Ltd.
provides for a
    one-year limitation on claims in clear and unambiguous language. As Cronk J.A.
    observed, at para. 28 of
International Movie Conversions
: it is difficult
    to conceive how it could have been made more explicit. Her observation is apt
    for this case too.

[37]

Clause 8 is clear
    and unambiguous. It explicitly states that the statutory conditions apply to
    the liability coverage under the policy. The insurance policy at issue in this
    case is a business agreement for the purposes of s. 22 of the
Limitations
    Act, 2002
,
and the one-year contractual
    limitation period is enforceable by Federated against McKeown & Wood
.

(h) The claim
    for a defence is barred by the contractual limitation period

[38]

It follows that
    the one-year limitation period in the policy is enforceable and it began to run
    when Federated refused to provide McKeown & Wood with a defence in the main
    action, as was its legal obligation under the policy.

[39]

The third party
    claim was issued nearly two-years after Federateds April 9, 2010 letter
    denying coverage and effectively refusing to perform any duty to defend. In
    these circumstances, McKeown & Woods claim that Federated owed it a
    contractual duty to defend is barred by the one-year contractual limitation
    period. It is accordingly unnecessary to consider the third issue raised on
    this appeal.

3) Federateds
    duty to indemnify

[40]

The insurance
    policy contains two sets of obligations. The first is for Federated to defend
    the insured in any action for damages to which the insurance would attach if
    liability were found. The second is for Federated to indemnify the insured for
    damages which the insured becomes legally obligated to pay for
bodily injury or property damage
.

[41]

This appeal
    determines that Federated does not have a duty to defend the insured. That determination
    does not dispose of Federateds second potential obligation under the policy,
    that of indemnification. The motion judges statements on any duty on Federated
    to indemnify McKeown & Wood are not binding on the parties.

E.

DISPOSITION AND COSTS

[42]

Accordingly, I
    would allow the appeal on the narrow basis that the motion judge erred in
    finding that the one-year limitation period found at Clause 14 of the Basic
    Policy Statutory Provisions form of Federated`s insurance policy did not apply.
    That provision does apply and, as a result, Federated is relieved of its duty
    to defend McKeown & Wood in the main action.

[43]

The appellant is
    entitled to costs in the agreed amount of $10,000, all-inclusive, and to a
    reversal of the costs award in the court below.

Released:
    December 24, 2015

P. Lauwers
    J.A.

I agree
    Alexandra Hoy A.C.J.O.

I agree
    Jean MacFarland J.A.


COURT OF APPEAL FOR ONTARIO

CITATION:
Enroute Imports Inc. (Re),
    2015 ONCA 849

DATE: 20151203

DOCKET: C60594

Sharpe, Cronk and Miller JJ.A.

In the
    Matter of the Bankruptcy of the proposal of

Enroute
    Imports Inc.

of the
    City of Mississauga in the Province of Ontario

J. Dannial Baker, for the appellant Victor Santaguida

Craig Mills, for the respondent Enroute Imports

Graham Phoenix, for the respondent MNP Limited

Heard: December 3, 2015

On appeal from the order/judgment of Justice Thomas J.
    McEwen of the Superior Court of Justice, dated April 23, 2015.

APPEAL BOOK ENDORSEMENT

[1]

The parties indicate they have resolved this matter in principle but
    require time to finalize specific terms. This appeal is accordingly adjourned
    on consent to be restored to the list at the earliest date available by the
    registrar if the court is not advised by December 23, 2015 that the settlement
    has been finalized.


COURT OF APPEAL FOR ONTARIO

CITATION: Gill v. CPNI Inc., 2015 ONCA 833

DATE: 20151201

DOCKET: C59728

Hoy A.C.J.O., Blair and Hourigan JJ.A.

BETWEEN

Paramjit Gill, Mahamud Nadeem Khazi, and Ratan
    Chakraborty

Plaintiffs (Respondents)

and

CPNI Inc., Patrick Bird, Timothy Price, and
    Michael Foulkes

Defendants (Appellants)

Patrick Bird, acting in person for CPNI Inc.

Chris McClelland, for the respondents

Heard and released orally: November 20, 2015

On appeal from the decision of Justice D. G. Stinson of
    the Superior Court of Justice, dated November 10, 2014.

ENDORSEMENT

[1]

The respondents were former employees of the appellant, CPNI Inc., who
    sued the appellant for unpaid wages and brought a motion for summary judgment.

[2]

The appellant argued on the motion that it was authorized under s. 13 of
    the
Employment Standards Act,

2000
, S.O. 2000, c. 41, to
    deduct amounts from the respondents unpaid wages, because the respondents
    stole software and intellectual property when they failed to return a company
    computer.

[3]

The appellant asserted that provisions in the respondents employment
    contracts requiring them to return company property on request constituted a
    written authorization by the respondents that permitted such deductions in
    accordance with s. 13(3) of the
ESA
.

[4]

In addition, the appellant also commenced a counterclaim for the
    remainder of the damages it alleged that it suffered as result of the failure
    of the respondents to promptly return the company computer.

[5]

The motion judge held that the appellant had not established a valid
    defence to the respondents claim and granted summary judgment against it. He
    found that, while it was common ground that the respondent Mahamud Khazi had
    the computer for a number of months, it was not entirely clear exactly when its
    return was demanded, what the consequences of its non-return were, and what
    losses, if any, were suffered by CPNI as a result. He also found that the
    evidence did not establish any involvement on the part of the respondents
    Paramjit Gill and Ratan Chakraborty in the alleged wrongful conversion of the
    computer by Mr. Khazi. Moreover, the motion judge was not persuaded that
    the employment contract between Mr. Khazi and CPNI contained an authorization
    of the sort contemplated by s. 13(3) of the
ESA
.

[6]

The motion judge also refused to stay the enforcement of the respondents
    judgment while the appellants counterclaim for conversion in relation to the
    unreturned computer proceeded. He held that the claim and counterclaim were not
    closely connected factually, as the respondents claims were for wages and the
    counterclaim related to an alleged conversion of the corporate asset occurring
    after the termination of the employment relationship between the parties.

[7]

The appellant submits that the motion judge erred in dismissing the
ESA
defence because the employment contracts establish that the employer had the
    right to avail itself of the deduction if an employee failed to return property
    when requested. The motion judge is also alleged to have erred in excluding
    Mr. Gill and Mr. Chakraborty from the s. 13 defence.

[8]

We would not give effect to these arguments.  Under s. 13 of the
ESA
,
    an employer is prohibited from making any deduction from an employees wages
    unless it is authorized to do so under that section. The motion judge was
    correct in concluding that there was nothing in respondents employment
    contracts that authorized deductions from the respondents wages pursuant to s.
    13(3). The return of company property provision relied upon by the appellant
    does not make any reference to deduction from wages nor does any other
    provision in the contract. Accordingly, this defence did not raise a genuine issue
    requiring a trial.

[9]

The appellant also submits that the motion judge made a number of errors
    in declining to order a stay pending a determination of the merits of its
    counterclaim. These include a failure to address the existence of language in
    the employment contracts concerning events subsequent to employment, failure to
    recognize the binary effect of these contracts, and a failure to explore the
    issue of valuation of the intellectual property.

[10]

The
    issuance of a stay is a discretionary remedy. We are not persuaded that the
    motion judge erred in the exercise of his discretion and there is, therefore,
    no basis to interfere with his decision.

[11]

The
    appeal is dismissed.

[12]

The
    respondent will have costs of the appeal fixed in the amount of $6,927, inclusive
    of fees, disbursements, and HST.

Alexandra Hoy A.C.J.O.

R.
    A. Blair J.A.

C.
    W. Hourigan J.A.