COURT OF APPEAL FOR ONTARIO

CITATION: Speciale Law Professional Corporation v. Shrader
    Canada Limited, 2015 ONCA 856

DATE: 20151207

DOCKET: C60537

Laskin, Pardu and Miller JJ.A.

BETWEEN

Speciale Law Professional Corporation and Anthony
    M. Speciale

Solicitors (Appellants)

and

Shrader Canada Limited

Client (Respondent)

John Gray, for the appellants

Rosemary Fisher, for the respondents

Heard: November 24, 2015

On appeal from the order of Justice Turnbull of the Superior
    Court of Justice, dated May 27 2015.

By
    the Court:

A.

Background

[1]

This appeal arises out of assessment proceedings taken by the client,
    Shrader Canada Limited, against its lawyer Anthony Speciale and his
    professional corporation Speciale Law Professional Corporation (SLPC).

[2]

From 1979 to 2013 Speciale or SLPC acted as counsel to Shrader and
    rendered accounts to it. From 2009 to 2013 Speciale was also the president and
    Chief Executive Officer of Shrader. Fifty-one accounts are in issue in these
    proceedings. All accounts are on the letterhead of SLPC, and signed by
    Speciale. All accounts have been paid.

[3]

In July 2013 Shrader obtained on requisition a Registrars order and
    appointment to assess the Solicitors accounts. The order was obtained under s.
    3 of the
Solicitors Act
, R.S.O. 1990 c. S-15, without notice to
    Speciale or SLPC.

[4]

In October 2013, Speciales counsel told Shrader he intended to bring a
    motion to challenge and set aside the order for the assessment. That motion was
    not brought until late May 2015. In the meantime, in January 2014, Speciale
    went to a mediation in the assessment proceedings, and when the mediation did
    not settle the matter, in September 2014 attended the Assessment Scheduling
    Court.

[5]

The assessment was scheduled to begin on June 1, 2015 and be continued
    in July. On May 26, Speciale brought an urgent motion to adjourn or stay the
    assessment and to quash the Registrars order for the assessment. Turnbull J.
    dismissed the motion. Speciale and SLPC appeal from his order.

[6]

On its face, Turnbull J.s order is interlocutory. But, as his reasons
    show, he decided issues that could have deprived Speciale and SLPC of
    substantive defences, we have treated the order as final for the purpose of
    appeal.

[7]

The assessment has now taken place. Thus the appeal from Turnbull J.s
    refusal to adjourn or stay the assessment proceedings is moot. But whether the
    Registrars order for assessment should be quashed remains a live issue, as
    Speciale and SLPC have opposed confirmation of the assessment report.

B.

Discussion

[8]

In dismissing their motion, the appellants Speciale and SLPC submit that
    Turnbull J. made the following five errors.

1.

He erred by failing to quash the assessment proceedings against Speciale
    personally as none of the accounts were rendered by him.

2.

He erred by failing to hold that 43 of the 51 accounts were for
    management and administration services, and therefore the assessment officer
    had no jurisdiction to assess these accounts.

3.

He erred by failing to hold that the retainer was in dispute, and for
    that reason the order for assessment must be set aside.

4.

He erred by failing to find special circumstances sufficient to justify
    setting aside the order for assessment.

5.

He erred by failing to find that the requisition for assessment was not
    timely.

[9]

We will address each of these alleged errors.

(1)

Speciale and SLPC

[10]

The
    appellants submit the assessment should be quashed against Speciale personally
    as he did not render any of the 51 accounts in question. Turnbull J. did not
    explicitly address this issue, but we decline to give effect to the appellants
    submission.

[11]

Admittedly,
    each of the accounts was on the letterhead of SLPC. But Speciale signed each of
    the accounts. And, importantly, the appellants led no evidence to show that
    SLPC included other lawyers or was anything other than the professional
    corporation of Speciale alone. On the record before Turnbull J., to give effect
    to the appellants submission would be unseemly and unjustified.

(2)

Management accounts and legal accounts

[12]

As
    we have said, the appellants claim that 43 of the 51 accounts were for
    management or administrative services and ought not the have been assessed
    under the
Solicitors Act
.

[13]

The
    appellants contend that the Re line on each account distinguishes accounts for
    management services from accounts for legal services. For example, they say all
    accounts with the Re line Shrader Canada Limited are accounts for management
    services, while an account with the Re line referring to a litigious matter is
    an account for legal services. They also point to internal accounting documents
    that appear to distinguish the two types of accounts.

[14]

Turnbull
    J. considered this issue, reviewed the accounts and concluded that they were
    all legal accounts. At para. 20 of his reasons he said:

I have had the opportunity to review the accounts which has
    been submitted. They are found as exhibit H to Mr. Speciales affidavit sworn
    May 24, 2015. The accounts attached thereto are all rendered on the letterhead
    of Speciale Law Professional Corporation. The preamble specifies in each
    account, that the account is for interim fees for services rendered for the
    period covered by the bill. Each account is broken down into lawyer time and
    docketing time for a law clerk. The account is signed by Anthony M. Speciale,
    Barrister & Solicitor. They are clearly legal accounts rendered to Shrader
    Canada. Counsel for the responding party Shrader has referred me to the Law of
    Costs, Second Editions Volume 2 by Mark M. Orkin, particularly to page 373,
    paragraph 316 dealing with nonprofessional services. There the learned author
    wrote:

The fact that the services in question might equally
    well have been rendered by a lay agent does not, however, eliminate the need
    for compliance with requirements of the Solicitors Act if the employment is so
    connected with the professional character of the solicitor as to afford the
    presumption that it formed the ground of employment by the client.

[15]

We
    agree with Turnbull J.s conclusion and his reasons.

(3)

The Retainer

[16]

If
    the retainer is in dispute, a client may not obtain an order on requisition
    under s. 3 of the
Solicitors Act
. The appellants submit that their
    retainer was in dispute because Shrader never executed a retainer agreement,
    and Speciales rates were never approved by the Shrader board.

[17]

We
    do not agree with this submission. Although Shrader did not sign a written
    retainer agreement, the retainer itself, which was in place for many years, was
    never in dispute. And that Speciales rates were never approved was simply a
    matter that went to the amount of his fees, and was properly within the
    jurisdiction of the assessment officer to determine.

[18]

Turnbull
    J. addressed this issue at paras. 23-24 of his reasons:

Mr. Yellin, on behalf of his client, Ms. Malcolm, stated that
    there is no denying the existence of the retainer. The comments made by his
    client and the assessment involved in this matter is an attack on the quantum
    of the bills and work done. The retainer is not in dispute.

Hence, on that basis I am satisfied that the retainer of this
    solicitor is not disputed within the meaning of Section 3 of the Act. As Mr.
    Yellin indicated, this is not a case where a lawyer acted without instructions.

We agree.

(4)

Special circumstances

[19]

A
    client may also not obtain an order on requisition if special circumstances
    exist. Special circumstances are any circumstances of an exceptional nature
    that a court ought to consider before an order for assessment is made. See
Davies,
    Ward & Beck v. Union Industries, Inc.
, [2000] O.J. No. 1769 at para.
    22.

[20]

Here,
    the appellants submit two circumstances are special: most of the accounts
    were for management services, and all of the accounts have been paid. Turnbull
    J. rejected this submission and so do we.

[21]

We
    have already concluded that all 51 accounts were legal accounts, properly
    subject to assessment. The payment of accounts is a factor to be considered in
    deciding whether special circumstances exist, but it is not a determinative
    factor. As Labrosse J.A. said in the
Davies, Ward & Beck
case at
    para. 21: The totality of the circumstances must be considered. In this case,
    the totality of circumstances includes the appellants participation in the
    assessment proceedings, which led Turnbull J. to conclude that no special
    circumstances exist. We agree with him.

(5)

Timeliness of the Requisition

[22]

Under
    s. 3(b) of the
Solicitors Act
, a client may obtain an order on
    requisition for the assessment of a bill already delivered, within one month of
    its delivery. Under s. 4 of the
Solicitors Act
, no order on
    requisition may be obtained after 12 months from the time the bill was
    delivered unless special circumstances exist. The appellants submit that
    Shrader has not met either of these time requirements. We do not accept this
    submission.

[23]

All
    51 bills were delivered. Their delivery is not disputed. The last account was
    dated May 15, 2013. Thus the 30 day period under s. 3(b) of the Act expired on
    June 15, 2013. The order was not obtained until July 31, 2015.

[24]

All
    the accounts are stated to be interim accounts, and the appellants accept that
    when a solicitor delivers a series of interim accounts, the 30-day period under
    s. 3(b) does not begin to run until the last account is delivered. See
Farlinger
    v. Maurice Neirinck
, [2008] O.J. No. 88. The appellants contend, however,
    that the order on requisition was still out of time by a month and a half.
    Turnbull J. rejected this contention for either of two reasons:

I find in the circumstances, that though there may have been a
    technical irregularity with respect to the issuance of the order, Mr. Speciale
    has attorned to the jurisdiction of the assessment order. The test for whether
    the steps taken by a party in a proceeding amount to attornment was recently
    considered by the Court of Appeal in
Wolfe v. Pickar
, 2011 ONCA 347 at
    para. 44:

 when a party to an action appears in court and goes
    beyond challenging the jurisdiction of the court based on jurisdiction
simpliciter
and
forum non conveniens
, the party will be regarded as appearing
    voluntarily, thus giving the court consent-based jurisdiction.

[25]

And:

If I am wrong in this respect, this court has inherent
    jurisdiction remedy any perceived defect in the issuance of the original order
    for assessment and I would have done so
nunc pro tunc
and ordered that
    the assessment proceed as scheduled on June 1, 2015.

[26]

We
    are not persuaded that his reasons reflect any error warranting our
    intervention.

[27]

Some
    of the accounts in question were delivered over a year before Shrader obtained
    the order for assessment. Turnbull J. found that because all the accounts were
    stated to be interim accounts, this very fact amounted to special
    circumstances, that met the requirement in s. 4 of the Act. We agree.

[28]

In
    effect, as Himel J. said in
Farlinger
: The overlapping and interrelationship
    of accounts constituted special circumstances. And, the client could not be
    expected to have objected to and taken out orders of assessment after each
    account was rendered. Also, as Turnbull J. noted, Speciale was the president
    and Chief Executive Officer of Shrader for part of the time when his accounts
    were delivered and paid. Only when Shrader obtained outside legal advice did it
    decide to assess the accounts.

C.

Conclusion

[29]

For
    these brief reasons we conclude that Turnbull J. did not err in refusing to
    quash the order for assessment. The appeal is therefore dismissed with costs
    fixed at $15,000 inclusive of disbursements and applicable taxes.

Released: December 7, 2015 (G.P.)

John Laskin J.A.

G. Pardu
    J.A.

B.W. Miller
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: State Farm Mutual Automobile Insurance Company v.

Aviva Canada Inc., 2015 ONCA 920

DATE: 20151224

DOCKET: C60035

Gillese, Epstein and Roberts JJ.A.

In the Matter of the
Insurance Act
,
    R.S.O. 1990, c. I.8, as amended
    and Ontario Regulation 668 thereunder

And in the Matter of the
Arbitration Act
,
    S.O. 1991, c. 17, as amended

And in the Matter of an Arbitration

BETWEEN

State Farm Mutual Automobile Insurance Company

Applicant (Appellant)

and

Aviva Canada Inc.

Respondent (Respondent)

Daniel Strigberger and Monika Bolejszo, for the
    appellant

Charlia von Buchwald, for the respondent

Heard: September 25, 2015

On appeal from the order of Justice James M. Spence of
    the Superior Court of Justice, dated October 10, 2014.

Gillese J.A.:

INTRODUCTION

[1]

An accident occurred on May 1, 2009, at the intersection of Yonge Street
    and Richmond Street in Richmond Hill, Ontario. Whose fault was it? In this
    appeal, the answer to that question depends upon how rule 5(1) of the
Fault
    Determination Rules
, R.R.O. 1990, Reg. 668 (the
FDRs
)
[1]
is interpreted

[2]

Rule 5(1) reads as follows:

5.(1) If an incident is not described in any of these
    rules, the degree of fault of the insured shall be determined in accordance
    with
the ordinary rules of law.
[Emphasis added.]

[3]

As will be seen, the meaning of the emphasized words in rule 5(1) is critical.

[4]

The role that rule 3 of the
FDRs
is to play, if any, in
    interpreting the emphasized words is also crucial. Rule 3 reads as follows:

3. The degree of fault of an insured is determined
    without reference to,

(a) the circumstances in which the incident occurs,
    including weather conditions, road conditions, visibility or the actions of
    pedestrians; or

(b) the location on the insureds automobile of the
    point of contact with any other automobile involved in the incident.

BACKGROUND

1.

The Accident

[5]

On the day in question, Ali Shalforoushzadeh (Ali) was driving his
    motorcycle southbound in the curb lane of Yonge Street, approaching the
    intersection where the accident took place. Some cars were stopped in the
    southbound passing lane to Alis left.

[6]

Meanwhile, Eric Basciano (Eric) was driving his car in the northbound passing
    lane on Yonge Street. He was on his way back to the hair salon that he owned,
    which was located near the intersection in question. He needed to turn left at
    the intersection.

[7]

The intersection does not have traffic lights guiding the flow of
    traffic.

[8]

Traffic was heavy. Eric stopped his car in the northbound passing lane
    and waited for a break in the southbound traffic so that he could turn left. He
    waited for a while and was then waved through the intersection by a driver
    who was stopped in the southbound passing lane. Eric did not see Ali and his motorcycle
    before he turned. It was only after Eric completed his turn that he heard
    skidding sounds. When he checked his rearview mirror, he saw a motorcycle
    skidding through the intersection.

[9]

There was no collision between the two vehicles. However, as a result of
    Erics turn into the southbound lane of traffic, Ali swerved. He lost control
    of his motorcycle, fell to the ground and was injured.

[10]

Ali
    applied to his insurer, State Farm Mutual Automobile Insurance Company (State
    Farm), for accident benefits payments. State Farm paid him the benefits and
    then sought indemnification from Erics insurer, Aviva Canada Inc. (Aviva),
    under the loss transfer provisions of the
Insurance Act
, R.S.O. 1990,
    c. I.8 (the
Act
).
[2]

2.

The Arbitration Award

[11]

State
    Farm and Aviva did not agree on the matter of indemnification and took the
    matter to arbitration. The arbitration proceeded on the basis of their agreement
    that fault was to be determined based on rule 5(1) of the
FDRs
. The
    parties were divided, however, on how rule 5(1) was to be interpreted and applied.

[12]

In
    an award dated February 14, 2014 (the Award), the arbitrator determined that Eric
    was 100% at fault for the accident.

[13]

The
    arbitrator heard the oral testimony of both drivers. She also had before her
    the transcripts of the examination for discovery of the drivers. She weighed
    the evidence and made the following findings of fact:

·

Ali clearly had the right of way as he proceeded southbound on
    Yonge Street, approaching the intersection in question;

·

Ali did not have a full view of the intersection as he approached
    it because of cars that were stopped in the passing lane to his left;

·

there was no evidence that Ali was travelling at a speed faster
    than approximately 30 km/hr, a speed well below the posted speed limit of 50
    km/hr;

·

Eric did not see Alis motorcycle before making his left turn,
    although it is clear that the motorcycle was there to be seen;

·

there was no impact between the vehicles but as a result of Erics
    turn, Ali lost control of his motorcycle, fell to the ground and sustained
    injuries.

[14]

The
    arbitrator then considered how rule 5(1) was to be applied. She concluded that rule
    5(1) calls for an analysis that is distinct from the approach required in a
    pure tort analysis. Her reasoning can be summarized as follows.

[15]

Rule
    5(1) of the
FDRs
requires that the insureds degree of fault be
    determined in accordance with the ordinary rules of law. The
FDRs
are
    a complete code referenced in s. 275 of the
Act
. Any fault determination
    conducted under the
FDRs
must be informed by rule 3 of the
FDRs
,
    which is an umbrella provision. Rule 3 requires that the degree of fault be
    determined without reference to various circumstances, including the weather and
    road conditions, actions of pedestrians, and the location on the insureds
    automobile of the point of impact.

[16]

The
    arbitrator went on to say that relevant
Highway Traffic Act
, R.S.O.
    1990, c. H.8

(
HTA
)

provisions and case law should
    not be ignored. She took note of rule 12(5) of the
FDRs
, which dictates
    a finding of 100% fault on the part of a left-turning vehicle where there is a
    collision between that vehicle and one proceeding straight through an intersection.

[17]

The
    arbitrator also noted that the
HTA
provisions regarding left-turning
    vehicles are consistent with rule 12(5). Section 141(5) of the
HTA
states
    that a driver must not turn left at an intersection into the path of an
    oncoming vehicle unless that driver has afforded a reasonable opportunity to
    the driver or operator of the approaching vehicle to avoid a collision.

[18]

The
    arbitrator found that Eric  the driver of the left-turning vehicle  did not
    see Ali approaching the intersection on his motorcycle and, therefore, could
    not have provided Ali with the opportunity to avoid the collision. She also
    found that Alis motorcycle was there to be seen even though Eric testified
    he did not see Ali approaching the intersection.

[19]

The
    arbitrator opined that if this case had been considered within the context of a
    tort action, some contributory negligence might be attributed to Ali based on
Nash
    v
.
Sullivan
(1973), 1 O.R. (2d) 133, 1973 CanLII 785 (C.A.). However,
    because of her analysis of the loss transfer provisions, she found Eric to be
    100% at fault for the accident.

3.

The Order under Appeal

[20]

Aviva
    brought an application in which it appealed the Award. By order dated October
    10, 2014 (the Order), the application judge set aside the Award and declared that
    Ali was 50% at fault for the accident.

[21]

The
    application judge noted the arbitrators determination that Ali had the right
    of way, a matter that was not disputed. He also noted the arbitrators finding
    that the motorcycle was there to be seen and stated that there is no basis
    to consider this finding of fact unreasonable.

[22]

However,
    the application judge said that the arbitrator erred in law when she disregarded
    the circumstance that cars were stopped to Alis left as he approached the
    intersection and failed to attribute contributory negligence. The application
    judge saw nothing in the provisions relating to the loss transfer scheme which required
    that circumstance to be ignored. He said that Alis failure to be alert as he
    approached the intersection  given that cars were stopped to his left  was the
    same type and degree of negligence as that of Eric. Based on
Nash
, the
    application judge apportioned fault for the accident on a 50/50 basis.

THE ISSUES

[23]

State
    Farm appeals to this court, asking that the Order be set aside and the Award be
    reinstated. It submits that the application judge erred by:

1.

making a finding of fact that the arbitrator did not make;

2.

failing to give deference to the arbitrators findings of fact and
    negligence under the ordinary rules of law;

3.

applying
Nash
to the facts of this case; and

4.

finding that the arbitrator incorrectly interpreted rule 5(1) of the
FDR
s.

ANALYSIS

Issue #1: A Finding of Fact not made by the Arbitrator

[24]

The
    application judge found Ali to be 50% at fault because he failed to be alert
    when approaching the intersection, despite the fact that cars were stopped to
    his left. State Farm says that it was an error for the application judge to
    have made the finding that Ali failed to be alert.

[25]

I
    agree.

[26]

The
    arbitrator heard the oral evidence and made no such finding. It was she who had
    the advantage of seeing and hearing the testimony first-hand. In this case, the
    evidence was mainly testimonial  as opposed to documentary  and credibility
    was in issue. In such a case, the application judge should have been wary of
    making such a finding:
Hollis v. Dow Corning Corp.
,

[1995] 4
    S.C.R. 634, 1995 CanLII 55, at para. 33.

[27]

In
    any event, however, there is nothing in the record to support the application
    judges finding that Ali failed to be alert when approaching the intersection.

Issue #2: Deference Owed to the Arbitrators Findings

[28]

State
    Farm submits that unless unreasonable, arbitral conclusions of mixed fact and
    law are entitled to deference. Therefore, because the application judge found
    the arbitrators findings of fact to be reasonable, State Farm says that he
    committed an error in law in setting aside her finding of fault.

[29]

In
    my view, this submission is misguided. The application judge set aside the
    arbitrators finding of fault because he viewed the arbitrator as having erred
    in law in determining fault under rule 5(1) of the
FDRs
. Thus, the
    question is whether the arbitrator applied the correct legal principles in
    making that determination. That question is the subject matter of Issue #4.

Issue #3: Whether
Nash
Applies

[30]

Given
    the arbitrators factual findings, in my view,
Nash
does not apply and
    the application judge erred in so doing.

[31]

In
Nash
, a driver was waiting to make a left turn at an intersection (the
    Defendant). He was travelling on a through street with two lanes in either
    direction. Traffic was heavy in both directions. An oncoming motorcyclist
    approached the intersection. Cars in the passing lane to the left of the
    motorcyclist were stopped. The driver of one of those stopped cars flashed his
    lights, indicating to the Defendant that he would wait while the Defendant made
    his left turn. The Defendant moved slowly into the intersection and hit the
    motorcyclist, who had approached the intersection in such a manner that he was
    hidden from the view of oncoming motorists intending to make a left turn.

[32]

The
    trial judge found the Defendant to be 100% liable for the accident because the
    motorcyclist had the right of way.

[33]

This
    court set aside the trial decision and held that the Defendant and the
    motorcyclist were equally at fault for the accident. It held that the
    motorcyclist was negligent in failing to slow his motorcycle and keep a proper
    look-out when he saw, or should have seen, that the cars to his left had
    stopped and because he approached the intersection in such a manner that he was
    hidden from the view of motorists intending to make a left turn.

[34]

While
    there are a number of common features between this case and
Nash
,
    there is one significant factual difference. In
Nash
, as the
    motorcyclist approached the intersection, he was hidden from the view of the oncoming
    left-turning drivers. The facts of this case, on that point, are completely to
    the contrary. Not only was there no finding that Ali was hidden from the view
    of motorists intending to make a left turn into the intersection, the
    arbitrator expressly found that Ali was there to be seen. It is noteworthy
    that the application judge commented on this finding, saying that there was no
    basis to consider it unreasonable.

[35]

For
    these reasons, in my view, the application judge erred in applying
Nash
and
    apportioning liability.

Issue #4: Interpreting Rule 5(1) of the
FDRs

[36]

Did
    the arbitrator correctly interpret rule 5(1) or was the application judge
    correct to find that she had erred in law? To resolve this issue, I will:

A.

provide an overview of the competing approaches of the arbitrator and
    the application judge, the parties positions on the issue, and my conclusion as
    to which approach is correct; and

B.

interpret the ordinary rules of law in rule 5(1), in light of:

i.

Ontarios loss transfer scheme;

ii.

rule 3 of the
FDRs
; and,

iii.

a consideration of the quoted words in context.

[37]

I
    will conclude by responding to two other considerations raised by Aviva.

A.

Overview

[38]

Rule
    5(1), it will be recalled, reads as follows:

5. (1) If an incident is not described in any of
    these rules, the degree of fault of the insured shall be determined in accordance
    with the ordinary rules of law.

[39]

Because
    the accident in this case is not described in any of the
FDRs
, rule
    5(1) applies to determine fault.

[40]

Pursuant
    to rule 5(1), the degree of fault of each insured is to be determined in
    accordance with the ordinary rules of law (the quoted words). Therefore, to
    correctly apply rule 5(1), we must first understand what is meant by the quoted
    words.

[41]

The
    arbitrator proceeded on the basis that fault determination under rule 5(1) must
    be informed by the instruction given in rule 3 of the
FDRs
. Because
    rule 3 requires the degree of fault to be determined without reference to the
    circumstances in which the incident occurs, in the arbitrators view, the
    quoted words in rule 5(1) call for an approach distinct from a pure tort law
    analysis. To determine the degree of fault, she looked at rule 12(5) of the
FDRs
 which governs situations similar to this case except that they involve a
    collision  and s. 141(5) of the
HTA
. She did not use tort law to
    determine fault.

[42]

The
    application judge acknowledged that rules 1 through 5 of the
FDRs
are provisions
    of general application. However, he saw nothing in them that would require the
    court to disregard the circumstances of the accident  specifically, that the
    cars to Alis left as he approached the intersection were stopped  for the purposes
    of determining fault under rule 5(1). In his view, it was an error in law for
    the arbitrator to have disregarded that circumstance. As a result, he set aside
    her decision and determined fault in accordance with the tort law jurisprudence,
    specifically, the
Nash
decision.

[43]

State
    Farm says that, for the reasons given by the arbitrator, it was she who interpreted
    rule 5(1) correctly, not the application judge.

[44]

Aviva
    takes the opposite position. It says that the application judge was right to
    reject the arbitrators use of rule 3 when determining fault under rule 5(1). It
    contends that rule 3 applies when fault is determined under rules 6 through 19
    of the
FDRs
but the quoted words dictate that fault under rule 5(1) is
    to be determined through the application of tort law. Aviva points to some judicial
    and arbitral decisions as support for its position.

[45]

In
    my view, the arbitrator correctly interpreted and applied the quoted words in rule
    5(1), having regard to the purpose and scheme of the loss transfer provisions as
    a whole. Accordingly, there was no basis for the application judge to set aside
    the Award and substitute his own determinations as to fault.

B.

Interpreting the ordinary rules of law in rule 5(1)

[46]

The
    meaning to be given to the ordinary rules of law in rule 5(1) of the
FDRs
is a matter of statutory interpretation. I make this seemingly obvious point
    because the decisions relied on by Aviva have not approached the matter in that
    fashion. Instead, those decisions are based on the assumption that the words
    the ordinary rules of law in rule 5(1) mean the ordinary rules of
tort
law. I pause to note that it would have been a
    simple matter for the legislature to have included the word tort in the
    quoted words in rule 5(1), had that been its intention. In any event, when the
    meaning of the quoted words is approached as a matter of statutory
    interpretation, it becomes clear that the word tort should not be read into
    rule 5(1).

[47]

As
    a matter of statutory interpretation, the task is to discover the intention of
    the legislator as expressed by the words the ordinary rules of law. To
    accomplish that task, those words are to be considered in their entire context,
    and read in their grammatical and ordinary sense, in harmony with the legislative
    framework within which they are found:
Bell ExpressVu Limited Partnership v
.
Rex
, 2002 SCC 42, [2002] 2 S.C.R. 559, at paras. 26, 55.

[48]

The
    quoted words are within rule 5(1), rule 5(1) is part of the
FDRs
, and
    the
FDRs
are an integral part of Ontarios loss transfer scheme. Ontarios
    loss transfer scheme, therefore, provides the context within which to consider
    the quoted words.  Thus, I begin with a consideration of that scheme.

i.

Ontarios loss transfer scheme

[49]

Under
    the
Act
, Ontario has a partial no-fault system. Since June 1990,
    regardless of fault, insureds look to their own insurers for the payment of statutory
    accident benefits, rather than seeking compensation from third parties (and
    their insurers). The Ontario legislature introduced the loss transfer scheme to
    address the cost implications for insurers of moving to this partial no-fault
    system: Ontario Insurance Commission (now the Financial Services Commission of
    Ontario), Interpretation Bulletin No. A-11/94, Loss Transfer: Standardized
    Forms and Procedures (6 June 1994).

[50]

Section
    268 of the
Act
requires an insurer to pay statutory accident benefits
    to its insured, in certain circumstances.  A motorcyclist is covered by this
    provision.
[3]
An insurer who pays such benefits to its insured is known as the first party
    insurer.

[51]

Section
    275 of the
Act
establishes the process by which the first party
    insurer can claim indemnification from another insurer.

[52]

Section
    275(1) allows the first party insurer, in certain situations, to claim
    indemnification from the insurer of the other driver involved in the accident. In
    this situation, the other drivers insurer is known as the second party
    insurer. It is the indemnification of the first party insurer by the second
    party insurer which is known as loss transfer.

[53]

Section
    275(2) of the
Act
requires that indemnification be made according to
    the respective degree of fault of each insurers insured as determined under
    the [
FDRs
].
[4]

[54]

The
FDRs
consist of twenty rules. The first five rules are general
    provisions. Those provisions are discussed below. Rules 6 through 19 contain a
    series of general types of incidents and specify the fault to be attributed to
    each driver in each incident. Fault is not a nuanced determination in rules 6
    through 19: it is typically assigned as 50% or 100%. Rule 20 provides the rules
    for fault determination when a driver involved in an incident is charged with a
    driving offence.

[55]

If,
    as in this case, the first party and second party insurers cannot agree on
    indemnification under s. 275, s. 275(4) of the
Act
requires them to
    resolve the matter through arbitration under the
Arbitration Act, 1991
,
    S.O. 1991, c. 17.

[56]

The
    legislation which creates the loss transfer scheme consists of the relevant
    provisions of the
Act
together with the
FDRs
. The purpose of
    the loss transfer scheme is to provide for an expedient and summary method of
    spreading the cost of statutory accident benefits among insurers, in a gross
    and somewhat arbitrary fashion, favouring expediency and economy over finite
    exactitude:
Jevco Insurance Co. v. York Fire & Casualty Co.
(1996),
    27 O.R. (3d) 483, 1996 CanLII 11780 (C.A.), at paras. 8-9.

ii.

Rule 3 of the
FDRs

[57]

For
    ease of reference, I set out rule 3 again now:

3. The degree of fault of an insured is determined
    without reference to,

(a) the circumstances in which the incident occurs,
    including weather conditions, road conditions, visibility or the actions of
    pedestrians; or

(b) the location on the insureds automobile of the
    point of contact with any other automobile involved in the incident.

[58]

A
    plain reading of rule 3, considered in conjunction with its location in the
FDRs
and the purpose of the loss transfer scheme, leads me to conclude that rule 3
    informs all fault determinations made under the
FDRs
, including those
    made pursuant to rule 5(1).

The wording of rule 3

[59]

Rule
    3 says that fault is to be determined without reference to  the circumstances
    in which the incident occurs. There is nothing in the wording of rule 3 which limits
    its application to rules 6 through 19, as Aviva contends. On a plain reading,
    rule 3 applies to all determinations of fault made under the
FDRs
,
    including those made under rule 5(1)
.

Rule 3s location in the
FDRs

[60]

Rules
    1 through 5 of the
FDRs
are located under the heading General. The wording
    of rules 1 through 5 and their location at the beginning of the regulation show
    that they are rules of general application in the
FDRs
.

[61]

Rule
    1 defines the centre line of a roadway.

[62]

Rule
    2(1) provides that an insurer shall determine the degree of fault of its
    insured  in accordance with [the
FDRs
].

[63]

Rule
    3, as I have just explained, limits the way in which fault is determined under
    the
FDRs
.

[64]

Rule
    4 governs situations in which more than one rule applies to an insured or
    incident.

[65]

And,
    as previously discussed, rule 5 governs where an incident is not described in
    any of the
FDRs
.

[66]

Accordingly,
    rule 3s location in the
FDRs
supports the view that it is a rule of
    general application and informs fault determinations made under rule 5(1), as
    well as those made under rules 6 through 19.

Rule 3 in light of the purpose of Ontarios
    loss transfer scheme

[67]

The
    view that rule 3 informs all fault determinations made under the
FDRs
,
    including those made pursuant to rule 5(1), is further reinforced by reference
    to the purpose of Ontarios loss transfer scheme. That purpose, as previously indicated,
    is to provide an expedient and summary method of resolving indemnification
    claims.

[68]

A
    determination of fault in tort law is often a lengthy, detailed and nuanced process,
    which requires findings of fact on the very circumstances excluded from
    consideration by rule 3. By precluding a pure tort law approach to fault
    determination, rule 3 acts in harmony with the purpose of the legislative scheme
    because it promotes an expedient, more summary approach for determining fault.

iii.

The ordinary rules of law considered in context

[69]

Having
    determined that rule 3 informs fault determinations made under rule 5(1), the
    ordinary rules of law cannot be interpreted as the ordinary rules of tort law.
    A determination of fault based on tort law rules would necessarily engage a
    consideration of the circumstances that the legislature purposefully excluded
    from consideration by rule 3. Furthermore, as already discussed, resort to pure
    tort law for the determination of fault would run contrary to the purpose of
    the loss transfer scheme, which is to provide an expedient and summary way of
    resolving indemnification claims.

[70]

Recourse
    to pure tort law for the determination of fault under rule 5(1) would also run
    contrary to s. 275(2) of the
Act
. Section 275(2) of the
Act
,
    it will be recalled, provides that indemnification depends on fault and fault
    is to be determined under the
FDRs
. In short, s. 275 establishes the
FDRs
as a complete code for determining fault in the indemnification context.  This
    dictate is reinforced by rule 2 of the
FDRs
, which provides that insurers
    are to determine the degree of fault of their insureds in accordance with the
FDRs
.

[71]

Finally,
    as I noted previously, had the legislature intended that fault determinations under
    rule 5(1) were to be made in accordance with the ordinary rules of tort law, it
    would have been an easy matter to have included the word tort. It did not do
    so. In my view, that was a deliberate decision because it enabled rules 3 and
    5(1) to be read in harmony with one another and the whole of the legislative
    scheme.

C.

Two concluding points

[72]

Aviva
    raised two other points which warrant comment.

[73]

Point
    #1  Aviva says that if fault is not determined under rule 5(1) in accordance
    with tort law, the parameters for fault determination under that rule are unclear.
    I accept this complaint to a point: it is correct that determining fault without
    reference to pure tort law creates some uncertainty as to what can be referred
    to, in making that determination. However, as the Award in the present case demonstrates,
    reference can be made to rules of law, despite there being no clear
    definition of those words. In the Award, the arbitrator referred to two things,
    both of which fall within the meaning of the ordinary rules of law as those
    words are used in rule 5(1) of the
FDRs
.

[74]

First,
    the arbitrator referred to rule 12(5) of the
FDRs
. Rule 12(5) deals
    with incidents very similar to that in the present case. Rule 12(5) applies
    where a collision results from a driver turning left into the path of an
    oncoming vehicle.  It does not apply in this case because there was no
    collision between the two vehicles.  Under rule 12(5), the driver of the
    left-turning vehicle is 100% at fault. Although not directly applicable, rule
    12(5) provides persuasive guidance for fault determination in this case.

[75]

Second,
    the arbitrator considered s. 141(5) of the
HTA
.  Section 141(5) provides
    that a driver shall not turn left across the path of an approaching vehicle unless
    he or she has afforded a reasonable opportunity to the driver or operator of
    the approaching vehicle to avoid a collision. The arbitrator noted that Eric,
    as the left-turning driver, testified that he did not see Ali approaching the
    intersection on his motorcycle and so could not have provided him with an
    opportunity to avoid a collision. In her opinion, the fact that there was no
    collision did not take away from Erics obligations in this regard.

[76]

A
    consideration of s. 141(5) of the
HTA
led the arbitrator to the same
    fault determination as that indicated by reference to rule 12(5). Accordingly,
    the arbitrator determined that Eric was 100% at fault for the incident.

[77]

The
    arbitrators fault determination could be criticized for being insufficiently
    nuanced. However, her approach is consistent with the legislative scheme, which
    is to provide an expedient and summary method of determining fault for the
    purposes of indemnification.  As this court observed in
Jevco v. York Fire
,
    at para. 9, fault determinations under the
FDRs
are done in a gross
    and somewhat arbitrary fashion, favouring expediency and economy over finite
    exactitude.

[78]

Point
    #2  Aviva pointed to three decisions as support for its position that the
    words the ordinary rules of law mean the ordinary rules of tort law for the
    purposes of rule 5(1):
Markel Insurance Co. of Canada v. Certas Direct
    Insurance Co
., 2011 ONSC 6069;
The Germania Farmers Mutual Fire Insurance
    Co. v. Federated Insurance Company of Canada
(15 November 2006), arbitral
    award of Stephen M. Malach (Ont. Arb.); and
ING Insurance Co. of Canada v.
    Farmers Mutual Insurance Co.
, 2007 CarswellOnt 3462, [2007] O.J. No. 2150
    (S.C.).

[79]

In
    the first two cases, I agree that the decision maker applied the ordinary rules
    of tort law when allocating fault pursuant to rule 5(1).  However, neither undertook
    a statutory interpretation of the quoted words before so doing.  It appears
    that both decision makers simply assumed that the ordinary rules of law means
    the ordinary rules of tort law.  On my reading of the third decision, it does
    not apply rule 5(1) nor address how the quoted words in it are to be
    interpreted.  Thus, none of these decisions offer a reason for following a pure
    tort law approach to fault determination under rule 5(1).

DISPOSITION

[80]

For
    these reasons, I would allow the appeal and set aside the Order, thereby
    restoring the Award. I would order costs of this appeal to the appellant fixed
    at $9,000, inclusive of disbursements and applicable taxes.

[81]

In
    its factum, the appellant sought its costs, which I understand to include costs
    before the application judge and the arbitrator. In light of the result on
    appeal, the general practice in this court would be to reverse the costs award
    below. However, in the absence of submissions on this matter, I would not
    decide it. If the parties are unable to resolve the matter of the costs below,
    I would permit them to file written submissions to a maximum of three pages,
    such submissions to be filed within ten days of the date of release of these
    reasons.

[82]

As
    for the costs of the arbitration, if the parties are unable to resolve that
    matter, I would order that they be referred to the arbitrator for determination.

Released: December 24, 2015 (EEG)

Eileen
    E. Gillese J.A.

I
    agree Gloria Epstein J.A.

I
    agree L.B. Roberts J.A.

APPENDIX A:
Fault
    Determination Rules
, R.R.O. 1990, Reg. 668

GENERAL

1. In this Regulation,

centre line of a roadway means,

(a) a single or double, unbroken or broken line
    marked in the middle of the roadway, or

(b) if no line is marked, the middle of the roadway
    or that portion of the roadway that is not obstructed by parked vehicles, a
    snowbank or some other object blocking traffic.

2. (1) An insurer shall determine the degree of fault of its
    insured for loss or damage arising directly or indirectly from the use or
    operation of an automobile in accordance with these rules.

(2) The diagrams in this Regulation are merely illustrative
    of the situations described in these rules.

3. The degree of fault of an insured is determined without
    reference to,

(a) the circumstances in which the incident occurs,
    including weather conditions, road conditions, visibility or the actions of
    pedestrians; or

(b) the location on the insureds automobile of the
    point of contact with any other automobile involved in the incident.

4. (1) If more than one rule applies with respect to the
    insured, the rule that attributes the least degree of fault to the insured
    shall be deemed to be the only rule that applies in the circumstances.

(2) Despite subsection (1), if two rules apply with respect
    to an incident involving two automobiles and if under one rule the insured is
    100 per cent at fault and under the other the insured is not at fault for the
    incident, the insured shall be deemed to be 50 per cent at fault for the
    incident.

5. (1) If an incident is not described in any of these
    rules, the degree of fault of the insured shall be determined in accordance
    with the ordinary rules of law.

(2) If there is insufficient information concerning an
    incident to determine the degree of fault of the insured, it shall be
    determined in accordance with the ordinary rules of law unless otherwise
    required by these rules.

RULES FOR AUTOMOBILES
    TRAVELLING IN THE SAME DIRECTION AND LANE

6. (1) This section applies when automobile A is struck
    from the rear by automobile B, and both automobiles are travelling in the
    same direction and in the same lane.

(2) If automobile A is stopped or is in forward motion,
    the driver of automobile A is not at fault and the driver of automobile B
    is 100 per cent at fault for the incident.

Diagram

(3) If automobile A is turning, either to the right or to
    the left, in order to enter a side road, private road or driveway, the driver
    of automobile A is not at fault and the driver of automobile B is 100 per
    cent at fault for the incident.

Diagram

(4) If automobile A is in forward motion and is entering a
    parking place on either the right or the left side of the road, the driver of
    automobile A is not at fault and the driver of automobile B is 100 per cent
    at fault for the incident.

Diagram

7. (1) This section applies when automobile A collides
    with automobile B while automobile B is entering a road from a parking
    place, private road or driveway.

(2) If the incident occurs when automobile B is leaving a
    parking place and automobile A is passing the parking place, the driver of
    automobile A is not at fault and the driver of automobile B is 100 per cent
    at fault for the incident.

Diagram

(3) If the incident occurs when automobile B is entering a
    road from a private road or a driveway and automobile A is passing the
    private road or driveway and, if there are no traffic signals or signs, the
    driver of automobile A is not at fault and the driver of automobile B is
    100 per cent at fault for the incident.

Diagram

8. If automobile A collides with automobile B on a
    controlled access road while automobile B is entering the road from an
    entrance lane, the driver of automobile A is not at fault and the driver of
    automobile B is 100 per cent at fault for the incident.

Diagram

9. (1) This section applies with respect to an incident
    involving three or more automobiles that are travelling in the same direction
    and in the same lane (a chain reaction).

(2) The degree of fault for each collision between two
    automobiles involved in the chain reaction is determined without reference to
    any related collisions involving either of the automobiles and another
    automobile.

(3) If all automobiles involved in the incident are in
    motion and automobile A is the leading vehicle, automobile B is second and
    automobile C is the third vehicle,

(a) in the collision between automobiles A and B,
    the driver of automobile A is not at fault and the driver of automobile B
    is 50 per cent at fault for the incident;

(b) in the collision between automobiles B and C,
    the driver of automobile B is not at fault and the driver of automobile C
    is 100 per cent at fault for the incident.

Diagram

(4) If only automobile C is in motion when the incident
    occurs,

(a) in the collision between automobiles A and B,
    neither driver is at fault for the incident; and

(b) in the collision between automobiles B and C,
    the driver of automobile B is not at fault and the driver of automobile C
    is 100 per cent at fault for the incident.

Diagram

RULES
    FOR AUTOMOBILES TRAVELLING IN THE SAME DIRECTION IN ADJACENT LANE

10. (1) This section applies when automobile A collides
    with automobile B, and both automobiles are travelling in the same direction
    and in adjacent lanes.

(2) If neither automobile A nor automobile B changes
    lanes, and both automobiles are on or over the centre line when the incident (a
    sideswipe) occurs, the driver of each automobile is 50 per cent at fault for
    the incident.

Diagram

(3) If the location on the road of automobiles A and B
    when the incident (a sideswipe) occurs cannot be determined, the driver of
    each automobile is 50 per cent at fault for the incident.

Diagram

(4) If the incident occurs when automobile B is changing
    lanes, the driver of automobile A is not at fault and the driver of
    automobile B is 100 per cent at fault for the incident.

Diagram

(5) If the incident occurs when automobile A is turning
    left at an intersection and automobile B is overtaking automobile A to pass
    it, the driver of automobile A is 25 per cent at fault and the driver of
    automobile B is 75 per cent at fault for the incident.

Diagram

(6) If the incident occurs when automobile A is turning
    left at a private road or a driveway and automobile B is overtaking
    automobile A to pass it, the driver of each automobile is 50 per cent at
    fault for the incident.

Diagram

(7) If the incident occurs when automobile A is turning
    left at a private road or a driveway and automobile B is passing one or more
    automobiles stopped behind automobile A, the driver of automobile A is not
    at fault and the driver of automobile B is 100 per cent at fault for the
    incident.

Diagram

11. (1) This section applies with respect to an incident
    involving three or more automobiles that are travelling in the same direction
    and in adjacent lanes (a pile-up).

(2) For each collision between two automobiles involved in
    the pile-up, the driver of each automobile is 50 per cent at fault for the
    incident.

Diagram

RULES
    FOR AUTOMOBILES TRAVELLING IN OPPOSITE DIRECTIONS

12. (1) This section applies when automobile A collides
    with automobile B, and the automobiles are travelling in opposite directions
    and in adjacent lanes.

(2) If neither automobile A nor automobile B changes
    lanes and both automobiles are on or over the centre lane when the incident (a
    sideswipe) occurs, the driver of each automobile is 50 per cent at fault for
    the incident.

Diagram

(3) If the location on the road of automobiles A and B
    when the incident (a sideswipe) occurs cannot be determined, the driver of
    each automobile is 50 per cent at fault for the incident.

Diagram

(4) If automobile B is over the centre line of the road
    when the incident occurs, the driver of automobile A is not at fault and the
    driver of automobile B is 100 per cent at fault for the incident.

Diagram

(5) If automobile B turns left into the path of automobile
    A, the driver of automobile A is not at fault and the driver of automobile
    B is 100 per cent at fault for the incident.

Diagram

(6) If automobile B is leaving a parking place or is
    entering the road from a private road or driveway, and if automobile A is
    overtaking to pass another automobile when the incident occurs, the driver of
    automobile A is not at fault and the driver of automobile B is 100 per cent
    at fault for the incident.

Diagram

RULES FOR AUTOMOBILES
    IN AN INTERSECTION

13. (1) This section applies with respect to an incident
    that occurs at an intersection that does not have traffic signals or traffic
    signs.

(2) If automobile A enters the intersection before
    automobile B, the driver of automobile A is not at fault and the driver of
    automobile B is 100 per cent at fault for the incident.

(3) If automobiles A and B enter the intersection at the
    same time and automobile A is to the right of automobile B when in the
    intersection, the driver of automobile A is not at fault and the driver of
    automobile B is 100 per cent at fault for the incident.

(4) If it cannot be established whether automobile A or
    B entered the intersection first, the driver of each automobile shall be
    deemed to be 50 per cent at fault for the incident.

14. (1) This section applies with respect to an incident
    that occurs at an intersection with traffic signs.

(2) If the incident occurs when the driver of automobile B
    fails to obey a stop sign, yield sign or a similar sign or flares or other
    signals on the ground, the driver of automobile A is not at fault and the
    driver of automobile B is 100 per cent at fault for the incident.

(3) If the driver of each automobile fails to obey a stop
    sign, the driver of each automobile is 50 per cent at fault for the incident.

(4) If it cannot be established who failed to obey a stop
    sign, the driver of each automobile shall be deemed to be 50 per cent at fault
    for the incident.

(5) If, at an all-way stop intersection, automobile A
    arrives at the intersection first and stops, the driver of automobile A is
    not at fault and the driver of automobile B is 100 per cent at fault for the
    incident.

(6) If, at an all-way stop intersection, both automobiles
    arrive at the intersection at the same time and stop, with automobile A to
    the right of automobile B, the driver of automobile A is not at fault and
    the driver of automobile B is 100 per cent at fault for the incident.

(7) If it cannot be established who arrived at the all-way
    stop intersection first, the driver of each automobile shall be deemed to be 50
    per cent at fault for the incident.

15. (1) This section applies with respect to an incident
    that occurs at an intersection with traffic signals.

(2) If the driver of automobile B fails to obey a traffic
    signal, the driver of automobile A is not at fault and the driver of
    automobile B is 100 per cent at fault for the incident.

(3) If it cannot be established whether the driver of either
    automobile failed to obey a traffic signal, the driver of each automobile shall
    be deemed to be 50 per cent at fault for the incident.

(4) If the traffic signals at the intersection are
    inoperative, the degree of fault of the drivers shall be determined as if the
    intersection were an all-way stop intersection.

RULES FOR AUTOMOBILES
    IN PARKING LOTS

16. (1) This section applies with respect to incidents in
    parking lots.

(2) The degree of fault of a driver involved in an incident
    on a thoroughfare shall be determined in accordance with this Regulation as if
    the thoroughfare were a road.

(3) If automobile A is leaving a feeder lane and fails to
    yield the right of way to automobile B on a thoroughfare, the driver of
    automobile A is 100 per cent at fault and the driver of automobile B is not
    at fault for the incident.

(4) If automobile A is leaving a parking space and fails
    to yield the right of way to automobile B on a feeder lane or a thoroughfare,
    the driver of automobile A is 100 per cent at fault and the driver of
    automobile B is not at fault for the incident.

(5) In this section,

feeder lane means a road in a parking lot other than a
    thoroughfare;

thoroughfare means a main road for passage into, through
    or out of a parking lot.

RULES
    FOR OTHER CIRCUMSTANCES

17. (1) If automobile A is parked when it is struck by
    automobile B, the driver of automobile A is not at fault and the driver of
    automobile B is 100 per cent at fault for the incident.

(2) If automobile A is illegally parked, stopped or
    standing when it is struck by automobile B and if the incident occurs outside
    a city, town or village, the driver of automobile A is 100 per cent at fault
    and the driver of automobile B is not at fault for the incident.

18. The driver of automobile A is 100 per cent at fault
    and the driver of automobile B is not at fault for an incident in which
    automobile A collides with automobile B when the driver of automobile A
    fails to obey,

(a) a police officers direction;

(b) a do not enter sign;

(c) a prohibited passing sign; or

(d) a prohibited turn sign.

19. The driver of automobile A is 100 per cent at fault
    and the driver of automobile B is not at fault for an incident that occurs,

(a) when automobile A is backing up;

(b) when automobile A is making a U-turn; or

(c) when the driver of, or a passenger in, automobile
    A opens the automobile door or leaves the door open.

RULES WHEN A DRIVER IS
    CHARGED WITH A DRIVING OFFENCE

20. (1) For the purposes of this Regulation, a driver is
    considered to be charged with a driving offence,

(a) if, as a result of the incident, the driver is charged
    with operating the automobile while his or her ability to operate the
    automobile was impaired by alcohol or a drug;

(b) if, as a result of the incident, the driver is
    charged with driving while his or her blood alcohol level exceeded the limits
    permitted by law;

(c) if, as a result of the incident, the driver is
    charged with an indictable offence related to the operation of the automobile;

(d) if the driver, as a result of the incident, is
    asked to provide a breath sample and he or she is charged with failing or
    refusing to provide the sample;

(e) if, as a result of the incident, the driver is
    charged with exceeding the speed limit by sixteen or more kilometres per hour.

(2) The degree of fault of the insured shall be determined
    in accordance with the ordinary rules of law, and not in accordance with these
    rules,

(a) if the driver of automobile A involved in the
    incident is charged with a driving offence; and

(b) if the driver of automobile B is wholly or
    partly at fault, as otherwise determined under these rules, for the incident.

APPENDIX B: ADDITIONAL
    LEGISLATIVE PROVISIONS

Insurance Act
, R.S.O. 1990, c. I.8

PART
    VI

AUTOMOBILE
    INSURANCE

Interpretation, Part VI

224. (1) In this Part,

automobile includes,

(a) a motor vehicle required under any Act to be
    insured under a motor vehicle liability policy, and

(b) a vehicle prescribed by regulation to be an
    automobile; (automobile)

Statutory accident benefits

268. (1) Every contract evidenced by a motor vehicle
    liability policy, including every such contract in force when the
Statutory
    Accident Benefits Schedule
is made or amended, shall be deemed to provide
    for the statutory accident benefits set out in the
Schedule
and any
    amendments to the
Schedule
, subject to the terms, conditions,
    provisions, exclusions and limits set out in that
Schedule
.  1993, c.
    10, s. 26 (1).

Liability to pay

(2) The following rules apply for determining who is liable
    to pay statutory accident benefits:

1. In respect of an occupant of an automobile,

i. the occupant has recourse against the insurer
    of an automobile in respect of which the occupant is an insured,

ii. if recovery is unavailable under subparagraph
    i, the occupant has recourse against the insurer of the automobile in which he
    or she was an occupant,

iii. if recovery is unavailable under subparagraph
    i or ii, the occupant has recourse against the insurer of any other automobile
    involved in the incident from which the entitlement to statutory accident
    benefits arose,

iv. if recovery is unavailable under subparagraph
    i, ii or iii, the occupant has recourse against the Motor Vehicle Accident
    Claims Fund.

2. In respect of non-occupants,

i. the non-occupant has recourse against the
    insurer of an automobile in respect of which the non-occupant is an insured,

ii. if recovery is unavailable under subparagraph
    i, the non-occupant has recourse against the insurer of the automobile that
    struck the non-occupant,

iii. if recovery is unavailable under subparagraph
    i or ii, the non-occupant has recourse against the insurer of any automobile
    involved in the incident from which the entitlement to statutory accident
    benefits arose,

iv. if recovery is unavailable under subparagraph
    i, ii or iii, the non-occupant has recourse against the Motor Vehicle Accident
    Claims Fund. 1993, c. 10, s. 1; 1996, c. 21, s. 30 (3, 4).

Liability

(3) An insurer against whom a person has recourse for the
    payment of statutory accident benefits is liable to pay the benefits. 1993, c.
    10, s. 1.

Indemnification in certain cases

275. (1) The insurer responsible under
    subsection 268 (2) for the payment of statutory accident benefits to such
    classes of persons as may be named in the regulations is entitled, subject to
    such terms, conditions, provisions, exclusions and limits as may be prescribed,
    to indemnification in relation to such benefits paid by it from the insurers of
    such class or classes of automobiles as may be named in the regulations
    involved in the incident from which the responsibility to pay the statutory
    accident benefits arose. 1993, c. 10, s. 1.

Idem

(2) Indemnification under subsection (1)
    shall be made according to the respective degree of fault of each insurers
    insured as determined under the fault determination rules.

Arbitration

(4) If the insurers are unable to agree
    with respect to indemnification under this section, the dispute shall be
    resolved through arbitration under the
Arbitration Act, 1991
. 2015, c. 20, Sched. 17, s. 5.

Highway Traffic Act
, R.S.O. 1990, c. H.8

Definitions

1. (1) In this Act,

motor vehicle includes an automobile, a motorcycle,
    a motor-assisted bicycle unless otherwise indicated in this Act, and any other
    vehicle propelled or driven otherwise than by muscular power, but does not
    include a street car or other motor vehicle running only upon rails, a
    power-assisted bicycle, a motorized snow vehicle, a traction engine, a farm
    tractor, a self-propelled implement of husbandry or a road-building machine;
    (véhicule automobile)

Turning at intersections

141.

Left turn, across path of approaching vehicle

(5) No driver or operator of a vehicle in an intersection
    shall turn left across the path of a vehicle approaching from the opposite
    direction unless he or she has afforded a reasonable opportunity to the driver
    or operator of the approaching vehicle to avoid a collision.

Compulsory Automobile
    Insurance Act
, R.S.O. 1990, c. C.25

Definitions

1. (1) In this Act,

motor vehicle has the same meaning as in the
Highway
    Traffic Act
and includes trailers and accessories and equipment of a motor
    vehicle; (véhicule automobile)

Compulsory automobile insurance

2. (1) Subject to the regulations, no owner or lessee of a
    motor vehicle shall,

(a) operate the motor vehicle; or

(b) cause or permit the motor vehicle to be operated,

on a highway unless the motor vehicle is insured under a
    contract of automobile insurance. 1994, c. 11, s. 383; 1996, c. 21, s. 50 (3).

Automobile Insurance
, R.R.O. 1990, Reg. 664

INDEMNIFICATION FOR
    STATUTORY ACCIDENT BENEFITS (SECTION 275 OF THE ACT)

9. (1) In this section,

first party insurer means the insurer responsible under
    subsection 268 (2) of the Act for the payment of statutory accident benefits;
    (assureur de première part)

motorcycle means a self-propelled vehicle with a seat or
    saddle for the use of the driver, steered by handlebars and designed to travel
    on not more than three wheels in contact with the ground, and includes a motor
    scooter and a motor assisted bicycle as defined in the
Highway Traffic Act
;
    (motocyclette)

second party insurer means an insurer required under
    section 275 of the Act to indemnify the first party insurer. (assureur de
    deuxième part) O. Reg. 780/93, ss. 1, 6.

(2) A second party insurer under a policy insuring any class
    of automobile other than motorcycles, off-road vehicles and motorized snow
    vehicles is obligated under section 275 of the Act to indemnify a first party
    insurer,

(a) if the person receiving statutory accident
    benefits from the first party insurer is claiming them under a policy insuring
    a motorcycle and,

(i) if the motorcycle was involved in the incident
    out of which the responsibility to pay statutory accident benefits arises, or

(ii) if motorcycles and motorized snow vehicles
    are the only types of vehicle insured under the policy; or

.
O. Reg. 780/93, s. 1.

[1]
The
FDR
s
are set out in full
    in Appendix A to these reasons.

[2]
All legislative provisions referred to in these reasons, except the
FDRs
,
    can be found in Appendix B. The
FDR
s
are included as Appendix A.

[3]
Where the insured is the occupant of an automobile, s. 268(2) of the
Act
provides that the insured has recourse against the insurer of an automobile in
    respect of which the occupant is an insured. The definition of an automobile
    for the purposes of Part VI of the
Act
, which includes ss. 268 and 275,
    is set out in s. 224(1) of the
Act
. It includes a motor vehicle
    required under any Act to be insured under a motor vehicle liability policy.
    Section 2(1) of the
Compulsory Automobile Insurance Act
, R.S.O. 1990, c.
    C.25 prohibits, subject to certain regulations, the operation on a highway of a
    motor vehicle as defined in the
HTA
, unless the motor vehicle is
    insured. The definition of a motor vehicle in s. 1(1) of the
HTA
includes a motorcycle.

[4]
Section 9(2) of
Automobile Insurance
, R.R.O. 1990, Reg. 664, provides
    that a second party insurer insuring any class of automobile other than
    motorcycles, off-road vehicles and motorized snow vehicles is obligated under
    s. 275 of the
Act
to indemnify a first party insurer if the person
    receiving statutory accident benefits from the first party insurer is claiming
    them under a policy insuring a motorcycle.


COURT OF APPEAL FOR ONTARIO

CITATION: Wakeling v. Kolla, 2015 ONCA 881

DATE: 20151211

DOCKET: C60461

Weiler, Pardu and Benotto JJ.A.

In the matter of an appeal from a decision of the
    Consent and Capacity Board from a hearing of an application under section 32(1)
    of the
Health and Consent Act, 1996
S.O. 1996, c. 2, Sch. A, as
    amended

BETWEEN

Andrew Wakeling

Appellant

and

Dr. Nathan Kolla

Respondent

DArcy J. Hiltz, for the appellant

Kendra Naidoo, for the respondent

Heard and released orally: December 9, 2015

On appeal from the judgment of Justice
Suhail
    A.Q. Akhtar
of the Superior Court of Justice, dated April 30, 2015.

ENDORSEMENT

[1]

The appellant appeals the dismissal of his appeal by a Superior Court Appeal
    Judge from the decision of the Consent and Capacity Board that he is a person
    who is incapable of consenting to treatment.

[2]

In coming to its conclusion that the appellant was incapable of
    consenting to treatment, the findings of the Board included the following:

·

the appellant was suffering from a schizoaffective disorder;

·

the appellants symptoms included paranoid delusions, auditory
    hallucinations and manic symptoms;

·

the appellant did not believe he had any manifestations of mental
    illness;

·

the appellants inability to recognize that he was affected by
    the manifestations of a mental illness meant he was unable to appreciate the
    consequences of his decision to refuse medication.

[3]

The Board upheld the finding of a medical practitioner that the
    appellant was incapable of consenting to treatment with antipsychotics, mood
    stabilizers, side effects medications and benzodiazepines.

[4]

The Superior Court Appeal Judge dismissed the appellants appeal from
    the Boards decision.

[5]

On the initial appeal and before us, the appellant raises three grounds
    of appeal. They relate to the sufficiency of the Boards reasons, whether the
    Boards decision was supported by the evidence and was reasonable and whether
    the Board understood and applied the correct test for capacity to consent.

[6]

In relation to the first ground of appeal, the sufficiency of the
    reasons, the appellant points out several acknowledged clerical or
    typographical errors. The two errors do not render the reasons unintelligible
    and had no impact on the result. In assessing the sufficiency of the Boards
    reasons, the reviewing judge was entitled to have regard to the entirety of the
    record as he did. The Boards chain of analysis was clear and the reviewing
    judge did not err in dismissing this ground of appeal.

[7]

In relation to the second and third grounds of appeal, we see no error
    in the Superior Court Appeal Judges reasons and would dismiss the appeal on
    these grounds for the reasons he gave.

[8]

The appellant further submits that his inability to recognize that he
    was affected by the manifestations of a mental illness did not relieve the
    Board from considering whether he should be able to refuse treatment because of
    the side effects of the medication. He argues that there is no evidence that
    the appellant was incapable with respect to side effect medication in general
    such as general medication for mood or benzodiazepine.

[9]

In his submissions before the Board the appellant did not ask the Board
    to separate treatment respecting medications as he is now doing. Nor was this
    argument made on the initial appeal. The appellant has provided a decision of a
    Board that appears to indicate that an individual who is incapable of
    consenting to treatment must nevertheless be given information respecting side
    effect medication.

[10]

That
    is not the situation here. The appellant was given information with respect to
    side effect medication but he said the benefits of the medication would not be
    applicable to him because he does not have an illness. The Board found the
    appellant was incapable with respect to all of the proposed medication and the
    record supports this conclusion.

[11]

Viewed
    as a whole the Boards decision was reasonable and the reviewing judge did not
    err in dismissing the appellants appeal. Accordingly, the appellants appeal
    is dismissed.

Karen M. Weiler J.A.

G. Pardu J.A.

M.L. Benotto J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Walchuk Estate v. Houghton, 2015 ONCA 862

DATE: 20151209

DOCKET: M45220 (C60317)

Laskin, Pardu and Roberts JJ.A.

BETWEEN

Mary Walchuk, Estate Trustee for Walter Walchuk,
    deceased

Plaintiff (Respondent/Moving Party)

and

Walter Houghton also known as Wilfred Houghton
    also known as Wilfred W. Houghton also known as Wilfred P. Houghton

Defendant (Appellant/Responding Party)

Andrew Sheremeta, for the moving party

Michael Jaeger, for the responding party

Heard: November 23, 2014

By
    the Court:

[1]

The respondent, Mary Walchuk, has brought a motion to quash this appeal
    from the judgment of Harper J. dated March 9, 2015. The issue on the motion is
    whether Harper J.s judgment is a final or interlocutory order. If it is a
    final order the motion fails; if it is an interlocutory order the motion
    succeeds. For the brief reasons that follow, we have concluded that the order
    is final.

A.

Chronology

(a)

Background

[2]

In 2011, Walchuk obtained a judgment against Houghton for $105,000. In
    December 2013, Walchuk sought to examine Houghton in aid of execution on the
    judgment. Houghton did not attend the examination. Walchuk then brought a
    motion for contempt.

[3]

The contempt motion first came on before Harper J. on September 5, 2014.
    He adjourned the contempt motion and ordered Houghton to attend at an examination
    in aid of execution on September 17, 2014, and to bring with him to that
    examination numerous documents requested by Walchuk.

[4]

On September 16, 2014, the day before the scheduled examination,
    Houghton filed for bankruptcy. During oral argument on this motion, we were
    told a trustee in bankruptcy is in place but has elected not to take part in
    these proceedings.

[5]

Houghton did attend the examination on September 17, 2014, but brought
    none of the documents requested. He took the position that because of s. 69 of
    the
Bankruptcy and Insolvency Act
, R.S.C. 1985, c. B-3 (
BIA
),
    the contempt proceedings against him were stayed.

[6]

After Houghton failed to produce documents, Walchuk renewed her motion
    for contempt. She claimed that Houghton had failed to comply with Harper J.s
    order of September 5, 2014. The contempt motion was heard by Harper J. in
    February of this year, and he released his reasons on March 9, 2015.

(b)

Harper J.s Judgment of March 9, 2015

[7]

The issue before Harper J. was whether s. 69(1)(a) of the
BIA
stayed the contempt proceedings. That section states:

69(1) subject to subsections (2) and (3), and
    sections 69.4, 69.5 and 69.6, on the filing of a notice of intention under
    section 50.4 by an insolvent person,

(a) no creditor has any remedy against the insolvent
    person or the insolvent persons property, or shall commence or continue any
    action, execution or other proceedings, for the recovery of a claim provable in
    bankruptcy

[8]

Although leave may be granted to lift the stay provided by s. 69, no leave
    has been sought. Nonetheless, Harper J. concluded that s. 69 did not stay the
    contempt proceedings against Houghton. He wrote at para. 22 of his reasons:

I am of the view that the motion for contempt before me is one
    that goes directly to the issue of the courts ability to enforce its
    judgments. The order I made was an order that called for the defendants to do
    certain things. Whether he did them or not cannot be caught up in his choice of
    the timing of his filing for bankruptcy. I find that the motion for contempt
    may proceed.

[9]

Harper J. did not rule on the contempt motion. Instead he ordered that
    it be heard on a date to be fixed by the trial coordinator. Although the
    contempt motion has not been heard, Houghton appealed Harper J.s March 9
    judgment.

(c)

Further proceedings

[10]

The
    contempt motion was scheduled for August 18, 2015. In June, Houghton brought a
    motion before Tulloch J.A. to stay the contempt proceedings pending his appeal.
    Walchuk brought a cross-motion to quash the appeal. Tulloch J.A. properly
    adjourned the motion to quash to a full panel, but dismissed Houghtons motion
    to stay on the ground Harper J.s judgment was an interlocutory order.

B.

Discussion

[11]

On
    her motion to quash, Walchuk submits that the judgment of Harper J. is an
    interlocutory order because he did not rule on the contempt motion. Instead, he
    simply ordered the motion to be heard at a later date. She relies on Tulloch
    J.A.s endorsement which held that the judgment under appeal is from an
    interlocutory order. Houghton on the other hand, submits that the order under
    appeal is final because Harper J. determined a substantive question: whether
    Houghton may still be subject to contempt proceedings despite s. 69 of the
BIA
.

[12]

The
    question whether orders under appeal are final or interlocutory has generated a
    lot of case law in this court. Some of the cases are not easily reconcilable.
    The starting point is to look at the judgment or order itself, and not the
    reasons for judgment. See
Ashak v. Ontario
, 2013 ONCA 375; and
Trainor
    v. Canada (Customs and Revenue Agency)
, 2011 ONCA 794.

[13]

Here,
    if one were to look at the judgment of Harper J. alone, his order appears to be
    interlocutory. It adjourns, rather than finally disposes of, the contempt
    motion. That was the view taken by our colleague, Tulloch J.A.

[14]

But,
    in some cases, to determine whether an order is truly final or interlocutory,
    one needs to look at the reasons. This is one of those cases. If the reasons
    show that a defendant has been deprived of a substantive right or defence that
    could resolve all or part of the proceedings, then the order is final. See
Ball
    v. Donais
, [1993] O.J. No. 972;
Abbot v. Collins
, [2002] O.J. No.
    4058;
Ashak
, at para. 17.

[15]

In
    this case, the only question before Harper J.  and it was a question of law
    was whether Houghton could still be liable for contempt though he had declared
    bankruptcy. Harper J. decided that question. Had he ruled that s. 69 of the
BIA
stayed the contempt proceedings, that ruling would have put an end to those
    proceedings. Because he ruled otherwise, Houghton has potentially been deprived
    of a right or defence that would have ended the proceedings against him. For
    this reason, Harper J.s judgment is a final order. Of course, whether Harper
    J. was right or wrong must be decided by the panel hearing the appeal.

[16]

The
    motion to quash is dismissed with costs fixed at $6,000 inclusive of
    disbursements and applicable taxes.

Released: December 9, 2015 (G.P.)

John Laskin J.A.

G. Pardu
    J.A.

L.B. Roberts
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Warman v. Fournier, 2015 ONCA 873

DATE: 20151211

DOCKET: C58503

Sharpe, Cronk and Miller JJ.A.

BETWEEN

Richard Warman

Plaintiff (Respondent)

and

Constance Fournier, Mark Fournier
,
Andrew Spencer
    (a.k.a. Droid 1963)
,

Roger
    Smith (a.k.a. Peter ODonnell), Jason Bertucci (a.k.a. Faramir),

Dan Lepage
    (a.k.a. SaskBigPicture),
Daniel Martin (a.k.a. Padraigh)
,

Jon F.
    Klaus (a.k.a. Klinkxx) and

John Does
    1  2 (a.k.a. conscience and HR-101)

Defendants (Appellants)

Barbara Kulaszka, for the appellants

James Katz, for the respondent

Heard: December 2, 2015

On appeal from the judgment of Justice Robert J. Smith of
    the Superior Court of Justice, dated February 27, 2014, sitting with a jury.

By the Court:

A.      Introduction

[1]

Following a civil libel trial by a judge and jury, the appellants were
    found liable to the respondent for defamation of character.  The jury awarded
    the respondent general, aggravated and punitive damages of $42,000.  At the
    conclusion of trial, the trial judge granted a permanent injunction against the
    appellants, enjoining them from publishing in any manner any statements found
    by the jury to be defamatory of the respondent.  He also awarded costs against
    the appellants, on a substantial indemnity scale, of $62,900.

[2]

The appellants appeal from the jurys liability and damages findings, and
    from the injunctive relief and costs award granted by the trial judge.

[3]

During oral argument, the appellants focused their submissions on five issues.
    They contend that:

i)

the trial judge erred by:

a)

failing to determine,
    before the case was left with the jury, whether the statements alleged by the
    respondent to be defamatory and the innuendos allegedly arising from those
    statements were capable of bearing the defamatory meanings pleaded by the
    respondent;

b)

leaving the question
    of malice with the jury and misdirecting the jury on  malice;

c)

granting a permanent
    injunction;

d)

awarding costs against
    the appellants on a substantial indemnity scale; and

ii)

the jurys aggravated and punitive damages awards are unreasonable and
    irrational.

[4]

For the reasons that follow, we conclude that all the appellants
    grounds of appeal must be rejected.

B.      Trial Judges Alleged
    Errors

(1)

Defamatory Meanings of Alleged Statements and Innuendos

[5]

The appellants argue that the trial judge erred in law by failing to
    rule, prior to the submission of the case to the jury, on whether the
    defamatory statements and false innuendos pleaded were capable of bearing the
    defamatory meanings asserted by the respondent.

[6]

We disagree, for two reasons.

[7]

First, at trial, the appellants counsel explicitly told the trial judge
    that her clients asked that all the alleged defamatory statements be put to the
    jury.  She made no request of the trial judge for the ruling that the
    appellants now say was necessary.  After taking this position, she neither
    objected to the form of the statements submitted to the jury nor to the trial
    judges instructions on the statements and innuendo.

[8]

Given this position and counsels failure to object to the form of the
    questions submitted to the jury, it necessarily followed that the appellants
    were content that the alleged innuendos arising from the statements were a
    matter for the jury.

[9]

Second, and importantly, it is clear from his instructions to the jury
    that the trial judge did decide that the statements at issue, together with the
    innuendos alleged, were capable in law of bearing the defamatory meanings
    alleged and he instructed the jury accordingly.  We have reviewed the
    statements and alleged innuendos and it is difficult to see how he could
    possibly have come to any other conclusion.

[10]

The
    appellants must bear the consequences of their tactical decisions at trial.  No
    error in the trial judges instructions on this issue having been demonstrated,
    this ground of appeal fails.

(2)

Malice

[11]

The
    appellants submit that the trial judge further erred by failing to consider
    whether the evidence adduced at trial was sufficient to support a potential
    finding of malice.  They maintain that the question of alleged malice should
    not have been left with the jury because there was no adequate evidentiary
    foundation for a finding of malice.  They also argue that the trial judge
    misdirected the jury on malice by failing to tell the jury that the defence of
    fair comment in a libel action can be defeated only on proof that malice was
    the dominant motive for publishing the statements at issue.

[12]

Again,
    we disagree.

[13]

At
    trial, the appellants relied mainly on the defence of fair comment and, in
    respect of some of the statements in question, on the defence of
    justification.  In the context of these defences, there was evidence at trial
    of the appellants conduct that, if accepted by the jury, could ground a
    finding of malice.  The appellants did not ask the trial judge to rule that
    there was no evidence capable of supporting a finding of malice.  A review of
    the record indicates that there was evidence capable of supporting a finding of
    malice and had the appellants asked for such a ruling, the trial judge would
    have had no choice but to put malice to the jury.

[14]

We
    are also not persuaded that the jury was misdirected on the legal requirements
    for a finding of actual malice.  The trial judges initial instructions did not
    indicate that malice must be the dominant motive for publishing the impugned
    statements in order to anchor a finding of actual malice.  However, the trial
    judges recharge to the jury emphasized that actual malice includes the making
    of a statement for the dominant purpose of harming someone out of personal
    spite or ill-will.  He told the jury, among other things: Actual malice
    includes every unjustifiable dominant intent to inflict injury on the person
    defamed.  In our view, as a result of the recharge, the jury could not have
    been under any misapprehension as to the controlling principles on the issue of
    malice.

[15]

In
    these circumstances, where the question of malice is properly pleaded,
    admissible evidence going to proof of malice is adduced, and a correct
    instruction on malice is provided by the trial judge to the jury, as in this
    case, the determination of malice is a question for the jury.  See for example,
Cherneskey v. Armadale Publishers Ltd.
, [1979] 1 S.C.R. 1067, at p.
    1090;
Davies & Davies Ltd. v. Kott
, [1979] 2 S.C.R. 686, at p.
    694.

[16]

This
    ground also fails.

(3)

Permanent Injunction

[17]

Nor
    are we persuaded that the trial judge erred, on the facts of this case, by
    granting permanent injunctive relief.

[18]

The
    trial judge appropriately confined the scope of the injunction granted so as to
    restrain the appellants only from publishing any statements found by the jury
    to be defamatory of the respondent.  Thus, the injunction is not overly broad.
    It only prevents future postings on the appellants website if those postings repeat
    the defamatory content as found by the jury.

[19]

The
    appellants argued that an injunction would prevent them from hosting an
    internet discussion forum, because they could not control what third parties
    posted to their site.

[20]

We
    disagree.  As counsel for the respondent argued, this fear rests on a
    misapprehension of the basis for liability of a forum host for libelous
    statements posted by a third party.  Liability in that circumstance turns on
    whether the statements at issue have been deleted by the host after reasonable
    notice to delete has been given.

[21]

Based
    on the appellants conduct as established by the evidence at trial, the trial
    judge inferred that the appellants would continue to publish the same
    defamatory statements about the respondent on their website unless enjoined by
    permanent court order from doing so.  This inference was rationally supported
    by the record, including by the following:

·

the appellants had refused, despite request therefor, to remove
    the defamatory statements from their website until approximately nine months
    after being served with the respondents first notice of libel and seven months
    after the delivery of his statement of claim;

·

the appellants continued to post the respondents pleading and
    his second notice of libel on their website up to and after the commencement of
    trial;

·

even after the jury verdict, the appellants posted a link on
    their website to a copy of the respondents statement of claim; and

·

the jury found that the appellants acted with malice.  This
    finding supported the conclusion that similar malicious postings on the
    appellants website could continue in the future.

[22]

In
    these circumstances, we agree with the trial judges conclusion, at para. 34 of
    his reasons:

The continued publication of libellous material would cause
    irreparable harm to the [respondents] reputation, and [the] prohibited
    material has already been found to constitute libel.  I find that the balance
    of convenience favours the granting of an injunction because the terms of the
    proposed injunction would not prevent any of the defendants from engaging in
    political comment that was not defamatory, whereas the harm to [the
    respondents] reputation would be substantial.  Based on the fact that the jury
    found that the defendants made 41 statements which were defamatory of [the
    respondent], that they did so maliciously, and that they have refused to
    apologize or publish a retraction, I find that [the respondent] has met his
    onus of showing that an injunction should issue to prevent the defendants from
    publishing in any manner whatsoever any statements found to be defamatory of
    [the respondent] in this action.

[23]

In
    our opinion, for the reasons given by the trial judge, the injunction granted
    was both warranted and appropriate.

(4)

Costs Award

[24]

We
    also reject the appellants challenge to the trial judges award of costs on a
    substantial indemnity scale.

[25]

The
    trial judge based his award of substantial indemnity costs on his consideration
    of three factors: i) the respondent achieved a result at trial that exceeded
    his pre-trial offer to settle under r. 49 of the
Rules of Civil Procedure
,
    R.R.O. 1990, Reg. 194; ii) the jury found that the appellants acted with malice
    towards the respondent, and in a high-handed and egregious manner; and iii) the
    principles governing costs as detailed in r. 57.01(1) of the
Rules of
    Civil Procedure
.

[26]

These
    factors amply justified an award of costs on a substantial indemnity scale.
    The trial judge made no error in principle in fashioning his costs award, nor
    is his award plainly wrong.  As a result, appellate interference with the award
    is precluded:
Hamilton v. Open Window Bakery Ltd.
, 2004 SCC 9, [2004]
    1 S.C.R. 303, at para. 27.

C.      The Jurys Aggravated
    and Punitive Damages Awards

[27]

A jurys award of damages, including aggravated or punitive damages,
    attracts considerable deference from a reviewing court.  This is especially so
    in defamation cases.  An appellate court is not entitled to substitute its own
    view on the proper amount of damages for the judgment of the jury unless the
    verdict is so exorbitant or so grossly out of proportion to the libel as to
    shock the courts conscience and sense of justice:
Walker v. CFTO Ltd.
(1987), 59 O.R. (2d) 104 (C.A.), [1987] O.J. No. 236, at p. 110.

[28]

The
    appellants point to no error in the trial judges instructions on the nature
    and purposes of aggravated and punitive damages or on the circumstances in
    which such awards are reasonable and rational.  The appellants make only bald
    assertions that their conduct was undeserving of an award of aggravated or
    punitive damages.  They have not identified any error in the trial judges
    instructions on these types of damages or any other basis for appellate
    intervention with the jurys damages awards.

[29]

The
    jury concluded that the appellants had acted maliciously in publishing the
    defamatory statements in question.  The jurys damages awards indicate,
    contrary to the appellants contention, that it concluded that the appellants
    had acted in an oppressive and high-handed manner.  We agree with the trial
    judges observation, at para. 4 of his costs reasons, that there was ample  evidence
    on which the jury could have reached the conclusions that it did.

[30]

We
    see no basis upon which to disturb the jurys awards of aggravated ($7,000) and
    punitive ($13,000) damages against the appellants.

D.      Disposition

[31]

For the reasons given, the appeal is dismissed.  Leave to appeal costs
    is granted and the costs appeal is also dismissed.  The respondent is entitled
    to his costs of the appeal, fixed in the amount of $23,000, inclusive of
    disbursements and all applicable taxes.

Released:

RJS                                       Robert J.
    Sharpe J.A.

DEC 11 2015                          E.A. Cronk J.A.

B.W.
    Miller J.A.


COURT OF APPEAL FOR ONTARIO

CITATION:  2148251 Ontario Incorporated v. Catan
    Canada Incorporated, 2014 ONCA 57

DATE: 20040123

DOCKET: C57347

Rouleau, Tulloch and Strathy JJ.A.

BETWEEN

2148251 Ontario Incorporated

Plaintiff (Respondent)

and

Catan Canada Incorporated and Leanne Duscio

Defendants/Plaintiffs by Counterclaim (Appellants)

and

2148251 Ontario Incorporated, Calum Waddell and
    Leslie Waddell carrying on business as Keystone Settlements International

Defendants by Counterclaim (Respondents)

Kevin D. Sherkin and Robert A. Gold, for appellants

Mark A. Radulescu, for respondents

Heard and released orally:  January 17, 2014

On appeal from the judgment of Justice James W. Sloan of
    the Superior Court of Justice, dated June 19, 2013, with reasons reported at
    2013 ONSC 4049.

ENDORSEMENT

[1]

This is an appeal from a judgment granting summary judgment for $500,000,
    plus interest and costs, on a promissory note made by the corporate appellant
    (Catan) and guaranteed by the individual appellant (Duscio). The respondent
    cross-appeals the dismissal of its motion for summary judgment dismissing the
    counterclaim.

[2]

The following facts are not in dispute:

·

a
    promissory note, dated April 25, 2008 was executed in favour of the respondent
    as payee by Catan as payor and Duscio as guarantor;

·

it
    was secured by a collateral mortgage of the same date;

·

the
    funds were duly advanced;

·

although
    the note called for interest to be payable monthly both before and after
    maturity, from and including May 25, 2008 to April 25, 2009, interest was never
    paid;

·

demand
    for payment was made on May 31, 2010;

·

the
    promissory note was not repaid;

·

the
    statement of claim was issued on April 20, 2011.

[3]

Before the motion judge, the appellants argued that the claim was time-barred
    because the limitation period began to run when Catan failed to make the first
    interest payment, due on June 25, 2008. The respondent argued that the
    limitation period did not begin to run until, at the earliest, the maturity
    date of the note, namely April 25, 2009.

[4]

The motion judge found the note was a demand note. He held the
    limitation period did not begin to run until the date of the demand, since the
    note provided that it was payable on demand after maturity date or at the
    discretion of the payee on the occurrence of any of the following events: (a) if
    the Payor does not pay when due any of its obligations to the Payee  .

[5]

The motion judge also rejected Duscios argument that the note was never
    to be repaid, but was instead intended to reflect an advance on her share of
    the profits of an alleged business venture with the principal of the respondent.
    The motion judge was not prepared to consider parol evidence to alter or vary
    the terms of the promissory note.

[6]

The appellants submit the motion judge erred in finding that the
    promissory note was a demand obligation. Instead, they say, the note was
    repayable on a fixed date, namely its maturity date of April 25, 2009. This
    feeds into the appellants submission that the limitation period began to run
    when the Payor failed to make the first interest payment, due on June 25, 2008.

[7]

The short answer to this submission is that the express terms of the
    promissory note gave the Payee the right, but not the obligation, to demand
    payment of the full amount of the note on the Payors default. The Payee had no
    obligation to demand repayment of the principal when an interest payment was
    missed. The limitation period did not begin to run, at the earliest, until
    maturity.  It is not necessary to consider whether it may have commenced at a
    later date, namely, the date of demand after maturity.

[8]

We agree with the motion judge that parol evidence could not be
    considered to show that the funds paid under the promissory note were intended
    as an advance rather than a loan.

[9]

The appellants argue that they are entitled to a share of profits and
    that these sums should have been credited towards the payment of the note. We
    disagree. As conceded by the appellants, the note stands on its own. There is
    no evidence the note is in error. The dispute as to whether any profits are
    owed to the respondents is an issue for the trial of the counterclaim.

[10]

For
    these reasons, we would dismiss the appeal.

[11]

On
    the cross-appeal, the respondent submits the motion judge should have dismissed
    the counterclaim as time-barred, because he found there was an admitted
    falling-out between the parties between July and September 2009. On this basis,
    the respondent says, the counterclaim is time-barred because it was not
    commenced until November 25, 2011.

[12]

Clearly
    the motion judge had some doubt about whether the respondent had established the
    proper date for the commencement of the limitation period. The significance of
    the falling-out on the commencement of the limitation period is an issue for
    trial. We see no reason to interfere with the motion judges conclusion and
    therefore dismiss the cross-appeal.

[13]

Success
    was divided, but the main appeal was of greater significance and involved more
    work. Costs are therefore ordered to the respondent in the amount of $7,000,
    inclusive of applicable taxes and disbursements.

Paul Rouleau J.A.

M. Tulloch J.A.

G.R.
    Strathy J.A.