COURT OF APPEAL FOR ONTARIO

CITATION: 2240802 Ontario Inc. v. Springdale Pizza Depot
    Ltd., 2015 ONCA 236

DATE: 20150409

DOCKET: C58100

Doherty, Epstein and Tulloch JJ.A.

BETWEEN

2240802 Ontario Inc., Niraj Patel,
    Riteshkumar Sheth

and Kinu Snehal Amin

Respondents

and

Springdale Pizza Depot Ltd., 2220731
    Ontario Inc., Ranjit Singh

Mahil and Dilawar Singh Khakh

Appellants

David Altshuller and Kristina Davies, for the appellants

Shane P. Murphy, for the respondents

Heard: October 30, 2014

On appeal from the judgment of Justice Susan Greer of the
    Superior Court of Justice, dated December 2, 2013.

Epstein J.A.:

[1]

This is another appeal involving the sufficiency of a franchisors
    disclosure of information to a potential franchisee. In fact, this is at least
    the third appeal this court has heard concerning whether the appellant
    franchisor, Springdale Pizza Depot Ltd., complied with its statutory disclosure
    obligations associated with the sale of a franchise.
[1]

[2]

Springdale is the franchisor of a franchise system known as Pizza Depot.
    The appellants, Ranjit Singh Mahil and Dilawar Singh Khakh, are the principals
    of Springdale. Both individuals are also directors of the company. The
    appellant, 2220731 Ontario Inc. (222), is a wholly owned subsidiary of
    Springdale. Springdale uses 222 to enter into sub-lease agreements with
    franchisees.

[3]

The respondent, 2240802 Ontario Inc. (224), is a Pizza Depot
    franchisee. The respondents, Niraj Patel, Riteshkumar Sheth and Kinu Snehal
    Amin, are the principals of 224.

[4]

In April 2010, Patel, Sheth and Amin advised Springdale that they had
    found a location for a new Pizza Depot franchise. On April 29, 2010, 222 leased
    the premises proposed by Patel, Sheth and Amin. On May 6, 2010, Springdale
    accepted the respondents as franchisees.

[5]

On May 28, 2010, pursuant to s. 5(1) of the
Arthur Wishart Act
(
Franchise Disclosure), 2000
, S.O. 2000, c. 3, Springdale provided 224
    with a disclosure document (the Disclosure Document). On June 18, 2010,
    Patel, Sheth and Amin signed the franchise agreement and, on October 8, 2010,
    they started to run their new business.

[6]

The franchise experienced financial difficulties and the respondents
    ultimately concluded the Disclosure Document was deficient. On February 16,
    2012, the respondents delivered a notice of rescission and by statement of
    claim dated May 15, 2012, they commenced an action against the appellants for
    rescission and substantial damages. By statement of defence dated July 10, 2012,
    the appellants defended the action and in April 2014, they amended their
    defence to advance a counterclaim. The respondents delivered a reply and
    defence to counterclaim dated April 17, 2014.

[7]

By notice of motion dated March 8, 2013, the respondents moved for
    partial summary judgment seeking, among other things, a declaration that the
    franchise agreement was validly rescinded and that the appellants were liable
    to them for damages.

[8]

The motion judge found that the Disclosure Document was materially
    deficient. She therefore granted partial summary judgment declaring that the Disclosure
    Document did not comply with the statutory requirements, the franchise
    agreement documents were validly rescinded, and the appellants were liable for
    damages in an amount to be determined by a Master, in accordance with the
    parties agreement.

[9]

The appellants raise two main grounds of appeal. First, they submit that
    there were material facts in dispute and other difficulties with the evidence
    such that the summary judgment procedure was not available.  Second, the
    appellants contend that the motion judge erred in finding that the disclosure
    Springdale provided was sufficiently deficient to give the respondents a right
    of rescission.

[10]

I
    would dismiss the appeal. While there was a conflict in the evidence as to the
    nature and contents of the Disclosure Document, that conflict was immaterial
    because the motion judge found that the respondents were entitled to rescission
    based on the appellants own evidence concerning the nature and extent of the
    disclosure they provided the respondents.  Further, I agree with the motion
    judge that the disclosure provided fell so far short of the clear statutory
    requirements that the respondents were entitled to rescission pursuant to s.
    6(2) of the Act.

THE STATUTORY FRAMEWORK

[11]

Section
    5 of the Act sets out franchisors disclosure obligations. It requires that a
    franchisor provide a franchise disclosure document to a prospective franchisee
    no fewer than 14 days before the earlier of the signing by the prospective
    franchisee of the franchise agreement and the payment of any consideration by
    the franchisee relating to the franchise. Section 5 also contains particulars
    pertaining to, among other things, the means for delivery of the disclosure
    document, the requirements for disclosure of material changes, and the contents
    of the disclosure document.

[12]

Section
    5(4) of the Act provides that the disclosure document shall contain:

(a)

all material facts, including
    material facts as prescribed;

(b)

financial statements as
    prescribed;

(c)

copies of all proposed franchise
    agreements and other agreements relating to the franchise to be signed by the
    prospective franchisee;

(d)

statements as prescribed for the
    purposes of assisting the prospective franchisee in making informed investment
    decisions; and

(e)

other information and copies of
    documents as prescribed.

[13]

Subsection
    5(4)(a) requires the franchisor to include all material facts in the
    disclosure document. The Act defines material fact broadly in s. 1(1) to
    include any information about the business, operations, capital or control of
    the franchisor or the franchise system that would reasonably be expected to
    have a significant effect on the value or price of the franchise to be granted
    or the decision to acquire the franchise.

[14]

Regulations
    under the Act provide further details of the disclosure the Act mandates.

[15]

Relevant
    to the issues in this case, pursuant to s. 3 of O. Reg. 581/00, every disclosure
    document shall include:

(a) an audited financial statement for the most recently
    completed fiscal year of the franchisors operations; [or]

(b) a financial statement for the most recently completed year
    of the franchisors operations, prepared in accordance with generally accepted
    accounting principles that are at least equivalent to the review and reporting
    standards applicable to review engagements set out in the
Canadian
    Institute of Chartered Accountants Handbook
; or

(c)  [Inapplicable.]

[16]

And
    s. 2 of O. Reg. 581/00 provides that every disclosure document shall contain:

5. A statement, including a description of details, indicating
    whether the franchisor, the franchisors associate or a director, general partner
    or officer of the franchisor has been found liable in a civil action of
    misrepresentation, unfair or deceptive business practices or violating a law
    that regulates franchises or businesses, including a failure to provide proper
    disclosure to a franchisee,
or if a civil action
    involving such allegations is pending against the person
. [Emphasis
    added.]

[17]

Section
    7 of O. Reg. 581/00 further provides that:

7. (1) Every disclosure document shall include a certificate
    certifying that the document,

(a) contains no untrue information, representations or
    statements; and

(b) includes every material fact, financial statement,
    statement and other information required by the Act and this Regulation.

(2)  A certificate referred to in subsection (1) shall be
    signed and dated by,

(a) in the case of a franchisor that is not incorporated,
    the franchisor;

(b) in the case of a franchisor that is incorporated and has
    only one director or officer, by that person;

(c)
in the case of a franchisor that
    is incorporated and has more than one officer or director, by at least two
    persons who are officers or directors
. [Emphasis added.]

[18]

Section
    6 of the Act provides the consequences for failing to strictly comply with the
    requirements set out in s. 5 and the regulations. These consequences include
    rights of rescission and compensation. Section 6 provides two separate time
    periods within which the franchisee can rescind:

6. (1) A franchisee may rescind the franchise agreement,
    without penalty or obligation, no later than 60 days after receiving the
    disclosure document, if the franchisor failed to provide the disclosure
    document or a statement of material change within the time required by section
    5 or if the contents of the disclosure document did not meet the requirements
    of section 5.

(2) A franchisee may rescind the franchise agreement, without
    penalty or obligation, no later than two years after entering into the
    franchise agreement if the franchisor never provided the disclosure document.

ISSUES

[19]

As
    set out above, in challenging the motion judges conclusion that the
    respondents were entitled to rescission, the appellants advance two main
    arguments. They submit that the motion judge erred by:

1.

finding that
    there was no genuine issue requiring a trial; and

2.

concluding that
    the variations between the Disclosure Document and the requirements under the
    Act were deficiencies that entitled the respondents to rescind the franchise
    agreement.

ANALYSIS

1.

Did the motion judge err in finding there was no genuine issue requiring
    a trial?

The Test for Summary Judgment

[20]

Pursuant
    to Rule 20 of the
Rules of Civil Procedure
, R.R.O. 1990, Reg. 194, the
    court shall grant summary judgment if there is no genuine issue requiring a
    trial.

[21]

At
    the time the partial summary judgment motion was heard,
Combined Air Mechanical
    Services v. Flesch
, 2011 ONCA 764, 108 O.R. (3d) 1, governed the approach
    to be taken on a motion for summary judgment.
Combined Air
established
    the full appreciation test. In applying this test, the court had to determine
    whether it was possible to fully appreciate the evidence and issues by way of
    summary judgment, or whether a trial was required.

[22]

Subsequent
    to the hearing of the motion, the Supreme Court in
Hryniak v. Mauldin
,
    2014 SCC 7, [2014] 1 S.C.R. 87,

broadened the test for summary
    judgment. Under
Hryniak
, there will be no genuine issue requiring a
    trial if the summary judgment process provides the motion judge with the
    evidence required to fairly and justly adjudicate the dispute and is a timely,
    affordable and proportionate procedure: para. 66. Even if there appears to be a
    genuine issue for trial, following
Hryniak
, the motion judge has the
    discretion to use the new fact-finding powers under rules 20.04(2.1) and (2.2)
    to avoid a trial in appropriate cases. These powers include weighing evidence,
    evaluating the credibility of a deponent and drawing reasonable inferences from
    the evidence.

The Appellants Complaints
    Regarding the Evidence

[23]

Before
    this court the appellants renew the arguments they advanced before the motion
    judge by citing various problems with the record. They point out that Sheth,
    Amin and Amins husband failed to attend for examination for the purposes of
    the hearing of the motion and that Patel failed to comply with undertakings or
    questions taken under advisement arising from his cross-examination.

[24]

I
    agree with the appellants that the motion judge erred in holding that Sheth,
    Amin and Amins husband had no obligation to be examined. Given that Sheth and
    Amin were served with notices of examination pursuant to rule 34.04, and Amins
    husband was served with a summons to witness, they were required to respond to
    attend for the purposes of being examined. As indicated by the certificates of
    non-attendance in the record before the motion judge, Sheth, Amin and Amins
    husband failed to do so. It is also true that Patel did not comply with various
    obligations arising out of his examination; however, like the motion judge, I
    note that the appellants did not pursue the remedies available to them under
    the rules.

[25]

That
    said, I do not see what relevance these problems have to the task before the
    motion judge. I agree with her view that, for the purposes of determining the
    issues raised on the motion for partial summary judgment, there was no requirement
    that the examinations take place or that Patel comply with his undertakings.  What
    was required was a record that allowed the motion judge to determine the
    disclosure the appellants provided so she could evaluate the extent to which it
    met the requirements under the Act. As I have previously noted, in determining whether
    the disclosure the appellants provided met the statutory requirements, the
    motion judge relied on the appellants evidence concerning what was contained
    in the disclosure. In my view, by approaching the issue in this way, the motion
    judge had the evidence she needed.

[26]

The
    appellants also contend that the motion judge made a number of evidentiary
    errors.

[27]

The
    appellants submit, for example, that the motion judge erred by drawing an inference
    against them based on their involvement in other proceedings concerning
    allegations of improper disclosure. The appellants further argue that the
    motion judge failed to identify the basis upon which she found that the
    respondents were not provided with proper business information about
    Springdales operations. The appellants also submit that the motion judge erred
    in finding that there was no evidence that they did any research relating to
    the proposed new franchise location.

[28]

I
    do not agree that the motion judge misapprehended the evidence. The motion
    judge did not infer that the Disclosure Document was deficient because the
    appellants had been involved in other summary judgment motions in which allegations
    had been made that they did not meet their disclosure requirements under the
    Act. Rather, at para. 60 of her reasons, the motion judge merely observed that Springdale
    had previously been found to have failed to meet its disclosure obligations
    under the Act.  I do not read the motion judges reasons as implying that she
    drew any inference from these other proceedings.

[29]

Further,
    the motion judge did not err in finding that there was no evidence that the
    appellants did any research about the respondents proposed franchise location.
    As the appellants say in para. 35(f)(iv) of their factum, there was no
    evidence either way before her on this issue.  The record demonstrates that
    this is correct.  And, in my view, no evidence going either way means no
    evidence.  In any event, the motion judges observation in this respect is of
    little moment as it does not appear to have influenced her analysis.

[30]

Finally,
    the appellants attach considerable weight to the fact that with respect to what
    was in the Disclosure Document, Patels evidence conflicted with Mahils
    evidence and Mahil was not cross-examined. The difficulty with this submission
    is that the motion judge considered whether the respondents were entitled to
    rescission based on the disclosure that the appellants admit to having provided.
    By proceeding in this fashion the motion judge rendered the conflict in the
    evidence on this point immaterial.

Dealing with Rescission by way of Summary Judgment Was
    Appropriate

[31]

Based
    on the above analysis, I am of the view that the motion judge correctly applied
    the
Combined Air
test in concluding that the issue of the respondents
    right to rescission could be resolved by way of summary judgment.

[32]

Under
    either the
Combined Air
test or the
Hryniak
test, the
    circumstances here are such that the summary judgment process provided the
    motion judge with the evidence required to effectively adjudicate the dispute.
    A trial was not required.

[33]

Neither
    the respondents damages claim nor the appellants subsequent counterclaim
    detract from my conclusion that dealing with the issue of whether the
    respondents were entitled to rescission by way of partial summary judgment was appropriate.

[34]

From
    a practical perspective, I note that the parties themselves agreed that the
    issue of damages would be resolved before a Master and that the counterclaim
    was commenced after the motion was heard and decided.

[35]

Moreover, dealing with the discrete matter of the
    respondents right to rescission by way of summary judgment allowed the motion
    judge to expeditiously resolve an important issue, thereby benefiting the
    parties by narrowing their dispute and potentially paving the way to settlement
    on the remaining issues. This approach resonates with the spirit of
Hryniak
:
    see especially para. 60.

2.

Did the motion judge err in concluding that the variations between the Disclosure
    Document and the requirements under the Act were deficiencies that entitled the
    respondents to rescind the franchise agreement?

[36]

To
    answer this question, I first canvass the three main disclosure deficiencies
    the motion judge identified. I then outline the legal consequences of these
    deficiencies.

[37]

As
    mentioned above, I agree with the motion judges conclusion that the
    appellants failure to meet the statutory disclosure obligations gave the
    respondents the right to rescind the franchise agreements.

Disclosure Deficiencies

(i) The Financial Statements

[38]

The
    motion judge found that the financial statements appended to the Disclosure Document
    did not comply with the Acts requirements. She noted that the form containing
    the financial statements is entitled SPRING DALE (sic) PIZZA DEPOT LTD.
    Financial Statements March 31, 2009 (Unaudited). The Notice to Reader on the
    front page contains cautionary language: We  have  not  audited, reviewed or
    otherwise attempted to verify the accuracy or completeness of such information.
    Accordingly, readers are cautioned that these statements may not be appropriate
    for their purposes.

[39]

The
    motion judge held that these notes meant that the preparer of the statements
    did not verify anything. She went on to identify an obvious error in the
    statements concerning the amount indicated for accumulated depreciation and
    concluded that the individual who prepared the statements did not carefully
    read either the statements or the regulations governing their preparation. The
    motion judge therefore held that the financial statements did not comply with
    either s. 3(1)(a) or 3(1)(b) of O. Reg. 581/00, reproduced above, and were
    deficient.

[40]

The
    appellants submit that just because the financial statements are unaudited or
    fail to meet a review engagement standard, they are not necessarily deficient under
    the Act.

[41]

I
    do not agree. Section 3(1) of O. Reg. 581/00 provides that every disclosure
    document shall include  an audited financial statement or a financial
    statement  prepared in accordance with generally accepted accounting
    principles that are at least equivalent to the review and reporting standards
    applicable to review engagements set out in the
Canadian Institute of
    Chartered Accountants Handbook
. The regulation is clearly worded and it
    is mandatory. The financial statements contained in the Disclosure Document did
    not meet either standard and were therefore deficient.

(ii) The Certificate

[42]

The
    motion judge also found that the appellants failed to meet their obligations
    under s. 7 of O. Reg. 581/00, reproduced above. This section provides that if,
    as here, the franchisor is incorporated and has more than one officer and
    director, the disclosure document shall include a certificate, signed and dated
    by at least two individuals who are officers and directors of the franchise,
    certifying that the document is true and includes all information required by the
    Act.

[43]

The
    Disclosure Document contained a certificate signed on May 28, 2010, solely by
    Mahil. The motion judge rejected the appellants effort to correct this
    deficiency by producing, in its responding materials, a second certificate
    purportedly signed by Khakh on May 28, 2010. The appellants argue that the
    motion judge erred by disregarding Mahils evidence that two certificates were,
    in fact, signed the same day.

[44]

Even
    if I were to accept this argument it does not assist the appellants as the
    regulation is clearly worded. Section 7 mandates one certificate, not two. If
    Khakh did indeed sign a certificate on May 28, 2010, the requirements set out
    in s. 7 would still not be satisfied.

(iii) The Ongoing Litigation

[45]

At
    the time the appellants provided the Disclosure Document to the respondents,
    another franchisee was involved in ongoing litigation against Springdale for
    rescission based on deficient disclosure. The motion judge noted that, on the
    appellants evidence about what was disclosed, their disclosure did not make
    any reference to this litigation. Further, the franchisee that commenced the
    rescission litigation was not identified in the list of former franchisees
    appended to the Disclosure Document. Finally, at para. 52 of her reasons, the
    motion judge observed that had proper financial statements been prepared, this
    ongoing litigation would have appeared as a contingent liability in a footnote
    to the statements.

[46]

The
    appellants rely on Mahils evidence that information about other franchisees was
    provided in the Disclosure Document and that its inclusion was acknowledged by
    the respondents in the receipt they signed. This point, however, fails to
    address the more serious omission  the ongoing litigation the disclosure of
    which is necessary pursuant to s. 2(5) of the regulations.

[47]

Moreover,
    the ongoing litigation falls within the category of information about the
    business that, in my view, would reasonably be expected to have a significant
    effect on a prospective franchisees decision to purchase the franchise.  As
    such, this information amounted to a material fact that, pursuant to s. 5(4)(a)
    of the Act, had to be disclosed.  It was not.  This was another aspect of the appellants
    statutory disclosure obligations that required the appellants to disclose the
    ongoing litigation and that was not met by their failure to do so.
Consequences of the Disclosure Deficiencies

[48]

To
    order rescission under s. 6(2), the motion judge had to be satisfied that the
    Disclosure Document was so defective that it effectively amounted to no
    disclosure. If, on the other hand, the disclosure deficiencies merely amounted
    to imperfect disclosure, it was too late for the respondents to rescind the
    franchise agreement.

[49]

Having
    identified deficiencies in the Disclosure Document, the motion judge then went
    on to conclude that the respondents were entitled to rescission under s. 6(2)
    of the Act on the basis of these deficiencies. She wrote:

[61] The
Act
, itself, is in many ways consumer
    protection legislation. Franchisors are expected to comply with it and its
    Regulations. It is remedial legislation, which the Court may broadly apply. In
    examining  what  deficiencies  are  sufficiently  material  to  conclude  that
    the Disclosure  Document fails to  satisfy the substantial requirements of the
Act
,  Mr.  Justice Wilton-Siegel in
Sovereignty Investment
    Holdings, Inc. v. 9127-6907 Quebec Inc.
, [2008] O.J. No. 4450 (S.C.J.)
    found, in para.15 that out of 19 deficiencies in the case before him, there
    were at least 4 such  deficiencies  in  the  disclosure  provided,  each  of
    which,  on  its  own,  is  fatal  to  the Franchisors  assertion  that  it
    complied  with  the  requirements  of the
Act
to  deliver a
    disclosure document.

[62] One  of those  flaws  is  one  of the  same  fatal
    deficiencies  in  the  case  before me. The Financial Statements provided by
    the Franchisor did not comply with the
Act
, as earlier noted by me.
    As well, as in this case, the documents provided were not collected in a single
    document. As  well,  the Certificate provided  did  not comply with S.7
    Regulations and  the list of names of other  franchisees  and  the  status  of
    what  happened  to  them  was  not  part  of  the  Disclosure Document  received
    by the Plaintiffs.

[63] In  my  view,  none  of  the  deficiencies  noted  above
    are  so  minor  that  they  would  not qualify.   They are major deficiencies.
    There were other minor deficiencies, as noted by me. The Financial
    disclosure,  in  my  view,  must  comply  with  the
Act
,  in  every
    respect. To  have  a bookkeeper  prepare  a  statement  from  the  figures
    provided  by  the  Franchisor,  without  any documents  being  examined  or
    verified,  with  errors in its transcription and  no  Notes at the end about
    on-going  or  pending  litigation,  does  not  give  the franchisee a true
    financial picture. See also:
Melnychuk v. Blitz Limited
, 2010 ONSC
    566 at pp. 6 and 7.

[50]

I
    see no error in the manner in which the motion judge applied the law to the
    deficiencies apparent from the record or in her conclusion that the Disclosure Document
    was materially deficient.

[51]

In
4287975 Canada Inc. v. Imvescor Restaurants Inc.
, 2009 ONCA 308, 98
    O.R. (3d) 187, at para. 43, this court identified the distinction between
    imperfect disclosure and disclosure that is so deficient as to amount to no
    disclosure at all as follows: if the disclosure document that is provided
    turns out to be
materially deficient
, then no
    disclosure will be found to have been made (emphasis added).

[52]

The
    remedies for failure to comply with the strict disclosure requirements are
    intended to redress abuses by franchisors. As noted by MacFarland J.A. in
1490664
    Ontario Ltd. v. Dig This Garden Retailers Ltd.
(2005), 256 D.L.R. (4th)
    451 (C.A.), at para. 12, it is evident that the thrust of the Act is to set
    standards for adequate disclosure and to create significant penalties for
    failing to meet those standards.

[53]

I
    now turn to the disclosure deficiencies that have been identified in this case.

[54]

I
    start with the financial statements contained in the Disclosure Document.
    There are three different levels of engagement associated with the presentation
    of financial statements. The most reliable level is known as an audit
    engagement.  At this level a chartered accountant performs an independent verification
    of the numbers provided by management. The second most reliable level is known
    as a review engagement. At this level a chartered accountant verifies the
    numbers provided by management to satisfy himself or herself that they are
    reasonable.  The third level is known as a compilation engagement.  At this
    level the chartered accountant essentially organizes the numbers provided by
    management.  Significantly, the accountant provides no assurance as to the
    accuracy or reliability of the numbers. Essentially, a compilation engagement
    requires nothing more than formatting financial information.

[55]

Sections
    3(1)(a) and 3(1)(b) of O. Reg. 581/00 specify that the financial statements that
    must be contained in a disclosure document be prepared in accordance with either
    the audit engagement standard or the review engagement standard.

[56]

The
    Act is designed to address the perceived imbalance of power in the
    franchisor/franchisee relationship. The Acts purpose is to protect both
    prospective franchisees and those already parties to a franchise agreement. This
    goal is achieved, in part, through the obligation imposed on franchisors to
    provide disclosure, the right given to the franchisee to rescind the franchise
    agreement in the absence of proper disclosure, and the franchisees right of
    action for damages based on a franchisors failure to comply with the
    disclosure requirements.

[57]

The
    Act must be interpreted in a manner that advances this purpose. Prospective
    franchisees, often lacking in business experience (such as Patel, Sheth and
    Amin), must be able to rely on the information they are given  particularly
    information relating to the franchisors financial circumstances.  Providing a
    prospective franchisee with financial information about the franchisor that has
    been independently verified is more than a technicality. It is a foundational
    part of disclosure.

[58]

In
    my view, the failure to provide financial statements in accordance with s. 3(1)
    of the regulations  in other words, statements that have been independently
    verified to an audit engagement or review engagement level  by itself
    constitutes a material deficiency.

[59]

The
    other two deficiencies discussed above  the failure to include reference to
    the ongoing litigation in which a franchisee was claiming rescission based on
    deficient disclosure and the failure to provide a certificate in accordance
    with the Act  serve to strengthen the conclusion that the respondents
    disclosure was not just deficient but materially deficient such that it
    amounted to no disclosure under s. 6(2) of the Act.

CONCLUSION

[60]

I
    would not interfere with the motion judges decision to allow this matter to be
    determined by way of summary judgment. By assessing the sufficiency of
    disclosure based on the appellants evidence of what was disclosed to the
    respondents the motion judge identified undisputed deficiencies in the disclosure.
    From that vantage point the motion judge had no difficulty concluding that the
    appellants disclosure was so deficient as to amount to no disclosure and that
    the respondents were therefore entitled to rescission. I agree.

DISPOSITION

[61]

I
    would dismiss the appeal. In accordance with the parties agreement, the
    respondents are entitled to their costs of this appeal fixed in the amount of
    $5,000 including disbursements and applicable taxes.

Released: April 9, 2015 (DD)

Gloria
    Epstein J.A.

I
    agree Doherty J.A.

I
    agree M. Tulloch J.A.

[1]
See
2147191 Ontario Inc. v. Springdale Pizza Depot Ltd.
, 2015 ONCA 116,
    2015 CarswellOnt 2261; see also
2189205 Ontario Inc. v. Springdale Pizza
    Depot Ltd.
, 2011 ONCA 467, 336 D.L.R. (4th) 234.


COURT OF APPEAL FOR ONTARIO

CITATION: Abuzour v.
    Heydary, 2015 ONCA 249

DATE: 20150413

DOCKET:  M44807  C59984

Huscroft J.A. (In Chambers)

BETWEEN

Hasan Abuzour and Samira Abuzour

Respondent on Appeal

(Applicants)

and

Javad Heydary and Heydary Hamilton Professional
    Corporation

(Respondents)

Mark Adilman, for the applicants

Megan Marrie, for the moving party LAWPRO

Brian N. Radnoff, for Jeff Landmann, Yan Wang and Darren
    Smith

Heard:  March 26, 2015

Huscroft J.A.:

[1]

LAWPRO brings this motion for directions concerning the order of Penny J.,
    dated October 28, 2014, which states:

THIS COURT ORDERS that LAWPRO pay to the Abuzours the available
    proceeds of the 2013 insurance policy of the Respondents, Javad Heydary and
    Heydary Hamilton Professional Corporation.

[2]

That order was not appealed. A second order by Penny J., dated January
    29, 2015, dismissing a motion to vary his October 28 order, is subject to an
    appeal by Jeff Landmann, Yan Wang, and Darren Smith (Landmann, Wang, and
    Smith), three lawyers formerly employed by the Heydary law firm
.

[3]

LAWPRO asks whether the October 28 order is automatically stayed by
    operation of rule 63.01(1). In the event that the October 28 order is not automatically
    stayed, LAWPRO asks whether it should be stayed in the interests of justice.

Background

[4]

On October 28, 2014, Penny J. ordered LAWPRO to pay to the Abuzours the
    proceeds of an insurance policy held by Javad Heydary and Heydary Hamilton
    Professional Corporation. LAWPRO did not appeal this order.

[5]

Landmann, Wang, and Smith brought a motion to vary or set aside the
    October 28 order on the basis that it was made without adequate notice to them
    as affected non-parties.

[6]

Justice Penny concluded that they had a serious financial interest in
    the proceeding and were affected by the relief sought because the order
    exhausted coverage under the insurance policy and put them at risk of being
    sued by the Abuzours. As a result, they should have been given notice of the
    motion and had the right to bring the motion to vary or set aside the October
    28 order. However, Penny J. concluded that they failed to show sufficient cause
    to set aside or vary the October 28 order and dismissed their motion in his
    January 29, 2015 order.

[7]

Landmann, Wang, and Smith are appealing the January 29 order. LAWPRO
    agreed not to pay out on the insurance at their request.

[8]

On February 10, 2015, Penny J. ordered an interim stay until March 27,
    2015 or the date this court deals with the stay issue, whichever is sooner.
    Counsel representing LAWPRO, Landmann, Wang, and Smith, and the Abuzours
    undertook to take no action on the matter pending release of my decision on the
    motion.

LAWPROs Standing

[9]

The Abuzours submit that LAWPRO does not have standing to bring this
    motion. LAWPRO simply holds insurance proceeds. It has not appealed either the
    October 28 or the January 29 order and is an interpleader rather than a party.

[10]

The
    Abuzours note that Landmann, Wang, and Smith did not bring the present motion
    and suggest that LAWPRO should have brought a motion for interim relief under
    s. 134(2) of the
Courts of Justice Act
.

[11]

LAWPRO
    submits that the January 29 order and appeal impact on whether and when it is
    required to pay out on the insurance. LAWPRO submits that the court can make an
    order under s. 134(2) of the
Courts of Justice Act
even though it has
    not specifically brought its motion under that provision.

[12]

Landmann,
    Wang, and Smith submit that LAWPRO is a respondent and has an absolute right to
    bring the motion because it is threatened by an enforcement action.

[13]

In
    my view, LAWPRO is affected by the October 28 and January 29 orders and is
    entitled to bring this motion seeking directions. The motion is properly before
    the court.

Is the October 28 Order automatically stayed under rule
    63.01(1)?

[14]

Rule
    63.01(1) provides as follows:

63.01 (1) The delivery of a notice of appeal
    from an interlocutory or final order stays, until the disposition of the
    appeal, any provision of the order for the payment of money, except a provision
    that awards support or enforces a support order.

[15]

It
    is uncontroversial that the October 28 order is an order for the payment of
    money. However, that order is not under appeal. The January 29 order dismissing
    a motion to vary or set aside the October 28 order is the order that is under
    appeal.

[16]

Landmann,
    Wang, and Smith argue LAWPROs obligation to pay the Abuzours arises because of
    the combined effect of the October 28 order and the January 29 order dismissing
    the motion to vary or dismiss the October 28 order. Ultimately, they submit,
    their appeal of the January 29 order will require the Court to determine
    whether the October 28 order should have been made. They could not appeal the
    October 28 order because they were not parties to that order as a result of the
    failure of the Abuzours to provide notice of the motion to them. They argue
    that they should not be in a worse position than they would have been if they
    had received notice of the motion giving rise to the October 28 order.

[17]

The
    Abuzours submit that the October 28 order cannot be stayed automatically
    because it is not under appeal, whereas the January 29 order (the order under
    appeal) is not stayed automatically pursuant to rule 63.01(1) because it does
    not require payment or repayment of monies to anyone.

[18]

It
    is clear that Landmann, Wang, and Smith were not party to the October 28
    order because they were not provided with notice of the motion and that the
    failure of notice resulted in proceedings culminating in the January 29 order.
    It is also clear that the appeal of the January 29 order will determine the
    obligation to pay money under the insurance policy.

[19]

However,
    these considerations do not affect the operation of the rule, which has always
    been interpreted narrowly:
Longley v. Canada (Attorney General)
, 2007
    ONCA 149, 153 C.R.R. (2d) 224, at para. 11. The January 29 order contains no
    provisions requiring the payment of money and cannot properly be characterized
    as an order for the payment of money. It cannot be stayed automatically under rule
    63.01(1) without undermining one of the primary purposes of the rule itself,
    which is to provide a measure of certainty. It would be counterproductive to
    encourage litigation over whether a particular order is tantamount to an order
    to pay money. It is appropriate that the rule is interpreted narrowly.

[20]

I
    appreciate that, in the circumstances of this case, the Abuzours failure to
    provide notice to Landmann, Wang, and Smith of the motion resulting in the
    October 28 order not only occasioned further proceedings and expense, but also
    has the effect of denying them the benefit of an automatic stay that would have
    obtained had they received notice. In my view, this is a relevant consideration
    in determining whether a discretionary stay should be ordered. I consider this
    matter below.

Should a stay of the October 28 order be granted?

[21]

The grant of a stay under rule 63.02(1) is premised on
    the existence of an appeal. The October 28 order has not been appealed and as a
    result the court cannot grant a stay of that order under rule 63.02(1).

[22]

However,
    the Court has jurisdiction to grant a stay pursuant to s. 134(2) of the
Courts
    of Justice Act
. That section provides as follows:

On motion, a court to which a motion for leave to appeal is
    made or to which an appeal is taken may make any interim order that is
    considered just to prevent prejudice to a party pending the appeal.

[23]

As
    Doherty J.A. explained in
Waxman v. Waxman
, 2003 CanLII 22440, at
    para. 19, s. 134(2) establishes a broad jurisdiction for the court to make
    interim orders necessary to avoid prejudice to a party pending an appeal. The
    term party in s. 134(2) is not restricted to a party to the action:
CPC
    International Inc. v. Seaforth Creamery Inc.
(1996), 3 C.P.C. (4th) 100
    (Ont. C.A.), at paras. 6-7. Therefore, there is no impediment to granting
    relief to Landmann, Wang, and Smith in the context of this motion.

[24]

The
    test for granting interim relief under s. 134(2) is the same as for granting a
    stay pending appeal pursuant to rule 63.02(1). It is based on the test for an
    interlocutory injunction set out by the Supreme Court of Canada in
RJR-MacDonald
    Inc. v. Canada (Attorney General)
, [1994] 1 S.C.R. 311 at 334. It must be
    established that:

1.       there is a serious question to be tried;

2.       the applicant would suffer irreparable harm if the
    application       were refused; and

3.       the balance of convenience favours the applicant
    (i.e., the          applicant would suffer greater harm if the stay were not         granted
    than the respondent would suffer if the stay were      granted).

[25]

As
    Laskin J.A. has noted, the components of the test are interrelated in the
    sense that the overriding question is whether the moving party has shown that
    it is in the interests of justice to grant a stay:
BTR Global Opportunity
    Trading Limited v. RBC Dexia Investor Services Trust
, 2011
    ONCA 620, 283 O.A.C. 321, at para. 16.

Serious question

[26]

What is a serious question? Sopinka and Cory JJ.
    put the matter this way in
RJR-Macdonald
, at
    334:

There are no specific requirements which must
    be met in order to satisfy this test. The threshold is a low one. The
    judge on the application must make a preliminary assessment of the merits of
    the case. The decision of a lower court judge on the merits of the  claim
    is a relevant but not necessarily conclusive indication that the issues raised
    in an appeal are serious

Once satisfied that the application is neither
    vexatious nor frivolous, the motions judge should proceed to consider the
    second and third tests, even if of the opinion that the plaintiff is unlikely
    to succeed at trial.  A prolonged examination of the merits is generally
    neither necessary nor desirable.

[27]

The
    Abuzours submit that the serious issue threshold is not met and that the stay
    should be denied on this basis. They submit that Penny J. rejected all of the
    arguments raised by Landmann, Wang, and Smith in his January 29 order in strong
    terms.

[28]

In
    my view, this submission fails to appreciate the low threshold at the serious
    issue step. I need not conclude that the appellants have a strong argument or
    that they will succeed on appeal. Their appeal is neither vexatious nor
    frivolous, and that is enough at this stage to allow me to conclude that there
    is a serious issue to be tried.

Irreparable harm

[29]

Landmann,
    Wang, and Smith submit that they will suffer irreparable harm if LAWPRO pays
    out on the insurance policy to the Abuzours before their appeal is determined.
    Once this occurs they will be left without any professional liability insurance
    to defend against claims that may be brought against them by the Abuzours.

[30]

The
    appellants submission is supported by LAWPRO, which submitted that the only
    relevant insurance is the Heydary policy. Once it is paid out the insurance is
    exhausted, and this will leave up to $2.5 million in potential liability not
    covered.

[31]

The
    Abuzours submit that neither LAWPRO nor Landmann, Wang, and Smith have filed
    any evidence on the motion and that irreparable harm cannot be determined based
    on unsupported assumptions.

[32]

I
    disagree. I think it is reasonable to conclude from the nature of the
    proceedings that the appellants would suffer irreparable harm if a stay is not
    granted in these circumstances.

Balance of convenience

[33]

The
    balance of convenience test requires the court to determine which party will
    suffer the greater harm from granting or refusing a stay. This is determined on
    the unique characteristics of individual cases.

[34]

Landmann,
    Wang, and Smith submit that the balance of convenience favours not paying out
    the proceeds of the policy while the appeal is pending. The money is being held
    by LAWPRO and at worst the Abuzours face a delay in obtaining it. Their appeal
    of the January 29 order has already been perfected so the delay will be
    minimal.

[35]

LAWPRO
    submits that if the funds are paid out now and Landmann, Wang, and Smith
    succeed on their appeal, there is no assurance that the Abuzours will be able
    to repay LAWPRO, and that such a result could render the appeal moot.

[36]

The
    Abuzours submit that there is no evidence on the motion and as a result there
    is no basis that would allow the court to determine that the balance of
    convenience favours the grant of the stay. They characterize the concerns
    raised as speculative.

[37]

The
    strongest argument in favour of granting a stay is one of basic fairness. The
    problem at the heart of these proceedings results from the failure of the
    Abuzours to provide proper notice to Landmann, Wang, and Smith of the first
    motion before Penny J. Had notice been provided, they would have been able to
    appeal the October 28 order and that order would have been stayed automatically
    pursuant to rule 63.01(1).

[38]

In
    my view, the overall justice of this case requires the grant of a stay.
    Landmann, Wang, and Smith should not end up in a worse position than they would
    have been had they received proper notice of the first motion. Accordingly, the
    October 28 order of Penny J. is stayed pending appeal of the January 29 order.

Costs

[39]

If
    the parties cannot agree on costs they may make brief submissions in writing,
    not to exceed three pages, within 10 days of this order.

Grant
    Huscroft J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Astley v.
    Verdun, 2015 ONCA 225

DATE: 20150402

DOCKET: M44589 (C59749)

Simmons, Tulloch and Pardu JJ.A.

BETWEEN

Robert M. Astley

Plaintiff

(Respondent/Responding
    Party)

and

J. Robert Verdun

Defendant

(Appellant/Moving
    Party)

Elizabeth Roberts, for the appellant

Brian N. Radnoff, for the respondent

Heard and released orally: March 16, 2015

ENDORSEMENT

[1]

In our view, the motion judge erred in concluding that the contempt
    finding and sentence under appeal is merely a do-over of the original contempt
    finding and sentence, and that Mr. Verduns appeal does not raise a serious
    question to be argued warranting consideration of a stay pending appeal.

[2]

The contempt motion forming the subject matter of the current appeal was
    premised on Mr. Verduns failure to comply fully with the terms of the
    conditional sentence he received on the first contempt motion.  Having regard
    to the decision in
R. v. Casey
, [2000] O.J. No. 71 (C.A.) at para. 22,
    there is an arguable issue concerning whether Goldstein J. was entitled to
    proceed by further contempt motion rather than invoking enforcement mechanisms
    for breach of a conditional sentence.  In fairness to the motion judge, this
    issue was not raised before her.

[3]

Further, even assuming a further contempt motion was an available
    procedure, the quantum of the sentence imposed raises a serious question to be
    argued on appeal.  Having regard to the time served to date under the second
    conditional sentence, Mr. Verdun faces potential irreparable harm if a stay
    pending appeal is not granted.

[4]

We also conclude that the motion judge erred in holding there is any
    potential prejudice in these circumstances to Mr. Astley.  Unlike the first contempt
    motion, the second contempt motion was not about enforcing the original
    injunction.  Rather, it was about ensuring Mr. Verdun fulfilled precisely the
    terms of the conditional sentence imposed on the first contempt motion.  In
    these circumstances, the balance of convenience favours a stay.

[5]

As for the order for security for costs, even if the motion judge should
    not have considered outstanding costs awards under rule 61.06(1)(c), it was
    open to her to consider Mr. Verduns other conduct in the proceeding and to
    make an order for security costs having regard to that conduct.

[6]

In all the circumstances, we set aside the motion judges order
    dismissing the motion for a stay; we grant the motion for a stay; we vary the
    order for security for costs to $10,000; and we set aside the order dismissing
    the appeal for delay.  In addition, we direct that the security for costs be
    paid and the appeal be perfected within 30 days from today, failing which the
    appeal may be dismissed by the registrar for delay or for failing to pay the
    order for security for costs without further notice.  As success on this motion
    is divided, the order of the motion judge as to costs is set aside and there
    will be no order as to costs of the hearing before us.

[7]

On consent, this endorsement is amended to also provide that:

·

the appellants passport, currently being held by the Superior
    Court of Justice, shall be returned to him;

·

the appellant shall attend the appeal hearing at the Court of
    Appeal and shall surrender his passport to the Court of Appeal immediately
    prior to the appeal hearing;

·

that if the appeal is dismissed for failure to perfect the appeal
    or failure to pay the security for costs as provided in this endorsement, the
    order for a stay pending appeal is automatically terminated and the warrant of
    committal dated December 9, 2014 immediately continues in full force and
    effect, including the term requiring the surrender of the appellants passport.

Janet Simmons
    J.A.

M. Tulloch
    J.A.

G. Pardu J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Beatty v.
    Best Theratronics Ltd., 2015 ONCA 247

DATE: 20150414

DOCKET: C59117

Gillese, van Rensburg and Pardu JJ.A.

BETWEEN

Clifford Douglas Beatty

Plaintiff (Respondent)

and

Best Theratronics Ltd.

Defendant (Appellant)

Frank Cesario and Siobhan M. OBrien, for the appellant

Graeme B. Fraser, for the respondent

Heard: April 2, 2015

On appeal from the judgment of Justice Charles T.
    Hackland of the Superior Court of Justice, dated June 24, 2014.

ENDORSEMENT

[1]

The respondent moved for summary judgment in a wrongful dismissal
    action. The motion judge granted partial summary judgment, and directed that
    the claims for aggravated, punitive and special damages proceed to summary
    trial.

[2]

The appellant contends that the motion judge erred in his determination
    of the reasonable notice period of 16 months and in concluding that the
    respondent made reasonable efforts in mitigation. The appellant asks that the
    judgment be set aside and the respondents claim dismissed, or alternatively
    that a trial be ordered in respect of the period of reasonable notice and
    mitigation.

[3]

The respondent is a high school graduate who, after a long career in the
    military, joined the appellants predecessor in 1994. Throughout his employment
    he was the radiation safety officer for the appellants facility that
    manufactures nuclear medical equipment. The respondent was 58 years old when
    his employment was terminated with 12 weeks salary and benefit continuation.
    He had 16 years of continuous employment with the appellant and its
    predecessors.

[4]

The appellant asserts that, in determining the reasonable notice period,
    the motion judge erred in applying as a starting point one month per year of
    service, contrary to this courts decision in
Minott v. OShanter
    Development Co.
(1999),

42 O.R.(3d) 321, [1999] O.J. No. 5
    (C.A.).
Minott
rejected a one month per year of service rule of
    thumb because such an approach would elevate length of service above all
    relevant factors in determining reasonable notice (at para. 73).

[5]

We do not agree that the motion judge in this case applied any such
    approach. He considered the factors identified in
Bardal v. The Globe and
    Mail Ltd.
(1960), 24 D.L.R. (2d) 140 (Ont. H.C.) at p. 145: the character
    of the respondents employment, his length of service, his age and the
    availability of similar employment, having regard to his experience, training
    and qualifications. He considered various reported cases cited by the
    respondent where notice periods in the range of one month per year of service were
    applied to long service employees in senior technical positions, and concluded
    that these cases were comparable. He observed that the appellants position
    that 12 weeks notice was sufficient was remarkable and with no real
    rationale. He rejected as irrelevant two dated Nova Scotia decisions relied on
    by the appellant, where relatively short notice periods were applied for
    plaintiffs in non-technical positions who were initially terminated for cause.
    The motion judge did not apply a rule of thumb of one month per year of
    service; rather, he considered all of the
Bardal
factors, including,
    importantly, the specialized character of the respondents employment.

[6]

The appellant contends that the motion judge erred in finding that the
    respondents position as a radiation safety officer was highly specialized and
    technical, which in turn was relevant to the appropriate notice period and also
    to whether he had taken reasonable steps in mitigation.

[7]

We disagree. The appellants job functions were described at para. 5 of
    the motion judges decision, which excerpts a passage from the appellants own
    factum on the motion. The respondents responsibilities included the
    development and maintenance of a radiation safety program in compliance with
    applicable regulations, safety training and tours of the appellants facility
    and coordinating the safety program with local emergency authorities. The
    respondent undertook these functions in a highly regulated environment; indeed
    he was the site contact with the regulator, the Canadian Nuclear Safety
    Commission (the CNSC). When the respondent went on short term disability the
    appellant brought in an outside specialist to fill the role, a person with 25
    years experience working with the CNSC. There is simply no merit to the
    argument that the motion judge mischaracterized the appellants position when
    he concluded that it was specialized and technical.

[8]

The appellant also asserted in oral argument that the motion judge had
    proceeded in an unorthodox manner in inviting written submissions respecting
    a decision of the Superior Court in a wrongful dismissal action involving the
    same employer that had been released while his own decision was under reserve:
Vist
    v. Best Theratronics Ltd.
, 2014 ONSC 2867. In that case, a senior
    radiation physicist with 16 years service, who had been terminated with five
    weeks pay was awarded damages equivalent to six months notice. The motion
    judge distinguished
Vist
on the basis that there had been a 3.5 year
    interruption in the plaintiffs service in that case. There was nothing
    unorthodox about the motion judge requesting submissions on the
Vist
case; indeed, since the period of overall employment was the same, and a
    shorter notice period was recognized in that case, it was appropriate for the
    motion judge to afford the parties (and in particular the appellant, who might
    have sought to rely on this decision) the opportunity to address this case, as
    relevant to the reasonable notice period.

[9]

We therefore conclude that all of the relevant factors were properly
    identified and addressed by the motion judge in determining that 16 months was
    an appropriate notice period, and in firmly rejecting the appellants position
    that 12 weeks notice was sufficient.

[10]

On
    the mitigation issue, the appellant acknowledges that it had the burden of
    proving failure to mitigate, and that the standard of review is palpable and
    overriding error. The appellant argues that the motion judge made such an error
    in accepting that the respondent made reasonable efforts to mitigate his damages
    when, in the period of ten months between his termination and his
    re-employment, he applied for only four positions. According to the appellants
    evidence, there were at least 16 suitable positions advertised in a local
    newspaper for which the appellant had not applied. The appellant suggested that,
    because these positions might have used some of the skills the respondent
    possessed, he ought to have applied for the advertised positions.

[11]

The
    appellant referred to
Anderson v. Cardinal Health
, 2013 ONSC 6010, where
    the evidence was that the plaintiff had applied for 13 positions in eight
    months, and the defendant asserted that there were 27 positions for which she
    ought to have applied. In that case, the motion judge concluded that the
    availability of suitable alternative employment, relevant to both notice and
    mitigation, was a triable issue.

[12]

There
    are fundamental errors in the appellants approach: first, mitigation is not
    simply a question of counting up the number of job applications submitted by a
    terminated employee. The entire job search must be considered. The respondent
    provided evidence as to the steps he took in attempting to seek re-employment
    in the areas of medicine, public health, radiation safety and quality
    assurance. He was cross-examined about his efforts, and the motion judge found
    that these efforts were reasonable.

[13]

Second,
    the onus was on the appellant to prove that the respondent failed to take
    reasonable steps to find a comparable position reasonably adapted to his
    abilities:
Link v. Venture Steel Inc
., [2010] O.J. No. 779 (C.A.), at
    para. 73. The various advertised positions referred to by the appellant that
    the respondent had not applied for were rejected by the motion judge as completely
    inappropriate if they are intended to represent employment opportunities that
    the [respondent] should have been expected to pursue (eg. warehouse supervisor;
    warehouse personnel, order picker, general labourer, warehouse help, customer
    service rep, shipper receiver, etc.) In the
Anderson
case, the motion
    judge was unable to assess on the evidence before her, whether the positions
    that the plaintiff had not applied for were suitable. In the present case, that
    assessment could be readily undertaken.

[14]

All
    of the relevant evidence was before the motion judge on the mitigation issue,
    and the only reasonable conclusion was that the respondent acted reasonably in
    mitigating his losses when, ten months after his termination he was able to
    secure a contract position in the nuclear field.

[15]

Finally,
    the appellant raised in its factum concerns about the ability of the motion
    judge to decide the issues of reasonable notice and mitigation in a Rule 20
    motion. This is a case where it was manifestly fair and just for the motion
    judge to determine the issues he did in a summary manner. The motion judge had
    a full evidentiary record. The parties filed affidavits, and the respondent was
    cross-examined. There were no real credibility or even factual issues relevant
    to the period of reasonable notice and mitigation.

[16]

There
    was no error in the approach, reasoning or conclusions of the motion judge. Accordingly,
    the appeal is dismissed. The respondent shall have his costs of the appeal in
    the sum of $16,500, inclusive of disbursements and applicable taxes.

E.E.
    Gillese J.A.

K.
    van Rensburg J.A.

G.
    Pardu J.A.


COURT OF APPEAL FOR ONTARIO

CITATION:
Bhagria v. 316697 Ontario Inc., 2015 ONCA 243

DATE: 20150410

DOCKET: C59546

Feldman, Benotto and Brown JJ.A.

In the Matter of the Trust for a Charitable Purpose, 316697
    Ontario

Inc. o/a Hindu Sabha

BETWEEN

Inderjit Bhagria and Sanjiv Sharma

Appellants (Applicants)

and

316697 Ontario Inc. o/a Hindu Sabha, Purshottam
    Dhupar, Parveen Sharma, Bipen Kakker, Anuradha Sharma, Dinesh Chander, Raj Kaicker,
    Pat Malik, Sat Malik, S.K. Agarwal, Prabhat Kaput and Varinder Saili

Respondents (Respondents)

Application Under the
Charities
    Accounting Act
, R.S.O. c.C. 10, s. 10 and the inherent jurisdiction of the
    Ontario Superior Court of Justice in charitable matters

Mark Wiffen, for the appellants

Mark A. Klaiman, for the respondents

Heard and released orally: April 2, 2015

On appeal from the judgment of Justice Lemon of the Superior
    Court of Justice, dated September 25, 2014.

ENDORSEMENT

[1]

The parties were involved in a dispute about membership and voting
    rights in connection with a Hindu temple. The appellant objects to the finding by
    the application judge that the alleged irregularity in the September 24, 2007
    By-Law No. 7 vote was not established.  He asserts that the judge
    misapprehended and misapplied the burden of proof.  We do not agree.

[2]

The test was set out by McLachlin J., (as she then was) in
Leroux v.
    Molgat
(1985), 67 B.C.L.R. 29 as follows at para. 3:

Thus the main issues are whether irregularities are
    established, and, if so, whether the defendants responsible for the conduct of
    the election have shown that such irregularities did not affect the result.

[3]

Although Lemon J. did not articulate the test specifically, he
    effectively found that the appellant had not established an irregularity.
    Therefore, the burden of proof never shifted.  We agree.

[4]

The evidence of the handwriting expert, which, at best, impugned the provenance
    of some of the membership applications, did not go so far as to show that any
    non-member actually voted by proxy or in person at the meeting.  The onus was
    on the appellant to show that there was an irregularity, as in the case of
Beanibazar
    Social & Cultural Society of Toronto, Canada v. Nuruddin
, [2003] O.J.
    No. 4475, before the onus shifts to the respondent to show that the established
    irregularity or irregularities did not affect the result.  Because the onus on
    the respondent is onerous once the burden has shifted, it is important that
    allegations of irregularity are first established with clear, relevant
    evidence.

[5]

On the issue of costs, we agree with the application judge that this is
    not public interest litigation.  However, we accept the submission of the
    appellant that the application judge misapprehended a significant piece of
    evidence that he relied on to support his award of substantial indemnity costs,
    that is, he did not mention that the impugned letter of June 16, 2006 was
    retracted two weeks later.

[6]

On that basis, it is appropriate to set aside the award of substantial
    indemnity costs and substitute an award of partial indemnity costs fixed at
    $20,000, inclusive of disbursements and HST.  Costs of the appeal to the
    respondent fixed at $10,000 inclusive of disbursements and HST.

K. Feldman J.A.

M.L. Benotto J.A.

David Brown J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Bouzari v.
    Bahremani, 2015 ONCA 275

DATE: 20150421

DOCKET: C58082

Juriansz, Rouleau and van Rensburg JJ.A.

BETWEEN

Houshang
    Bouzari, Fereshteh Yousefi, Shervin Bouzari and

Narvan Bouzari

Plaintiffs (Respondents)

and

Mehdi Hashemi Bahremani, aka Rafsanjani
,
    Akbar Hashemi Bahremani, aka Rafsanjani, Ali Fallahian Najaf Abadi, Gholam
    Hossein Mohensi Ejei, John Doe, aka Siyadai, Bill Doe, aka Akbari Rad Massoudi
    and Tom Doe, aka Mohammad Saeedi aka Asghar Saeedia aka Mr. 99

Defendants (
Appellant
)

No one appearing for the appellant

Mark H. Arnold, for the respondents

Heard: October 23, 2014

On appeal from the order of Justice Andra Pollak of the Superior
    Court of Justice, dated December 11, 2013, with reasons reported at 2013 ONSC
    6337.

By the Court:

A.

Introduction

[1]

This is an appeal of an order dismissing a motion to stay proceedings
    commenced in Ontario on the basis of
forum non conveniens.
For the
    reasons that follow, the appeal is allowed.

[2]

The respondents are Houshang Bouzari, his wife, and children. Bouzari is
    a former Iranian national who is now a Canadian citizen and resident of
    Ontario. He alleges that in 1993, the appellant Mehdi Hashemi Bahremani (also
    known as Rafsanjani, and referred to in these proceedings as Hashemi) and his
    co-defendants compelled Bouzaris abduction, incarceration, and torture in
    Iran. The action underlying this appeal is the respondents second attempt to
    sue for Bouzaris torture in Iran.
[1]

[3]

In 2005, the respondents commenced these proceedings against Hashemi and
    others in the Superior Court. The action was not defended, and on August 26,
    2011, the respondents obtained default judgment against Hashemi. In granting
    default judgment, Low J. noted that the Superior Court took jurisdiction as a
    forum of necessity because there was no reasonable basis upon which the
    plaintiffs could be required to commence the action in a foreign jurisdiction,
    particularly Iran, the state where the torture took place:
Bouzari v.
    Bahremani
, [2011] O.J. No. 5009 (S.C.).

[4]

Hashemi brought a motion to set aside the default judgment, which was
    originally opposed by Bouzari. On June 25, 2013, the motion was granted on
    consent, with terms permitting Hashemi to move to challenge the forum.

[5]

The parties agreed it was impossible to litigate the dispute in Iran. However,
    Hashemi  a citizen of Iran, with no connection to Canada, who had been living
    and studying in England  asserted that the Ontario action should be stayed in
    favour of Bouzari and his family commencing proceedings in England. By the time
    the
forum non conveniens
motion was argued, however, Hashemi had
    voluntarily returned to Iran to face prosecution, and was unable to leave that
    country.

[6]

In our view, the motion judge made certain errors of fact which informed
    the exercise of her discretion. In particular, she concluded that there was no
    evidence that Hashemi would be denied entry to Canada to defend the
    litigation, when all of his previous efforts, including in the course of the motion,
    had been unsuccessful. She also concluded, without evidence, that deferring to
    an English court may deprive the respondents of certain rights. After
    considering all of the relevant factors, we arrive at a different conclusion:
    that the appellant has met the burden of establishing that England is a more
    appropriate forum for the litigation, and that the Ontario proceedings must be
    stayed in favour of litigation in the alternative court.

B.

Relevant Facts

(1)

The Action

[7]

For the purpose of this appeal, it is unnecessary to set out in detail
    the respondents claims in the Ontario proceedings. It is sufficient to note
    that the action alleges that, between 1992 and his escape from Iran in July
    1994, Bouzari was the victim of extraordinary acts of violence and torture as a
    result of his refusal to pay a bribe in his commercial dealings regarding Irans
    South Pars gas field. The respondents allege that Hashemi and the other
    defendants were involved in requesting the bribe and Bouzaris subsequent
    arrest and torture.

[8]

After escaping Iran, Bouzari lived briefly in Vienna, and then in Italy.
    In 1995, he settled with his family in England, where they lived for three
    years before immigrating to Canada in 1998. All of the events that the
    respondents claim constitute kidnapping, false imprisonment, assault, torture,
    and death threats are alleged to have taken place in Rome, Italy and Tehran,
    Iran.

[9]

In addition to Bouzaris above-mentioned claims, his wife and children
    assert claims under the
Family Law Act
, R.S.O. 1990, c. F.3. The statement
    of claim was served outside Ontario, pursuant to rule 17.02(h), on the basis
    that each respondent has sustained and continues to sustain damages in Ontario.

(2)

The Appellant

[10]

Hashemi
    is the son of one of Irans former presidents. When the action was commenced in
    2005, he was living in Iran. The statement of claim was sent to what was
    believed to be his business address, as well as other locations. Service was
    validated by the order of Master Clark on May 9, 2006, and the defendants were
    noted in default at that time.

[11]

In
    his March 2012 and August 2012 affidavits supporting his motion to set aside
    default judgment, Hashemi deposed that in August 2005  shortly after Irans
    2005 presidential elections in which the incumbent, President Ahmadinejad,
    defeated his father  he became the head of the Office of the Board of Trustees
    of Islamic Azad University in Tehran. Leading up to the 2009 presidential
    election that re-elected President Ahmadinejad, Hashemi supported the
    opposition. He also supported the protesters who demonstrated against the
    result. Due to mounting political pressure, Hashemi left Iran in August 2009. When
    Hashemi brought his motion to set aside the default judgment, he was living in
    England on a temporary visa, and feared arrest and incarceration should he
    return to Iran.

[12]

In
    October 2010, Hashemi became a graduate student at the University of Oxford and
    a member of Wolfson College. Hashemi claims that he only became aware of the
    Ontario proceedings in November 2011, after a copy of the statement of claim
    and related materials were deposited with Wolfson College, and the media asked for
    his comment on the default judgment.

[13]

Hashemi
    then retained counsel in Ontario to set aside the default judgment. He denies any
    involvement in the events forming the basis of the respondents action. He
    asserts his intention to defend himself against the claims in the appropriate
    jurisdiction.

[14]

During
    his stay in England, Hashemi also worked at a local branch of Azad University.
    According to his August 2012 cross-examination (which took place in England), this
    employment ended in May 2012. Hashemi also deposed that his English residence
    permit was to expire on June 16, 2013.

[15]

In
    August 2013, Hashemi filed a further affidavit, this one in support of his
forum
    non conveniens
motion. By that time he was living in Iran, where he had
    returned voluntarily on September 23, 2012 to clear his name. Upon his return
    to Iran, Hashemi was incarcerated for 84 days and prohibited from leaving Iran
    until the charges against him were finalized and tried. He estimated that the matter
    would go to trial by the end of 2013. In the interim, he suspended his studies
    in Oxford. Hashemi has a son who was living in England.

[16]

Hashemi
    claimed that he has no connection with Canada. In 1993, he attempted to enter
    Canada with a visa, but was denied entry. On May 9, 2012, upon being ordered to
    do so by Master Graham, Hashemi attended the Canadian High Commission in
    England to apply for a visa to visit Canada to attend his cross-examination on
    the affidavits filed in support of his motion to set aside default judgment. His
    application was denied. Under cross-examination via Skype from Iran, Hashemi
    explained that his Canadian visa application had been denied because his
    English visa was limited to one year and he could not return to Iran for political
    reasons. Hashemi filed an affidavit from the solicitor who attended with him at
    the High Commission verifying the documentation he submitted.

[17]

On
    June 15, 2012, Hashemi made a subsequent application for a Canadian visa, to
    which he has received no response. The respondents counsel also wrote to the
    Minister of Citizenship and Immigration requesting that a short-term special
    ministerial visa/permit be granted to Hashemi for the purposes of the action
    however that did not result in any visa being issued.

(3)

The Respondents

[18]

The
    respondents are Canadian citizens, residents and property owners. They lived in
    England for three years before immigrating to Canada in 1998. Bouzari and his
    wife have business interests in England, own property there, and travel there from
    time to time.

C.

Decision on the Motion

[19]

As
    already noted, the matter proceeded before the motion judge as a
forum non
    conveniens
motion. The parties agreed that the litigation could not
    proceed in the natural forum for the litigation of the dispute, Iran, and that
    the issue was whether England provided a more appropriate forum than Ontario.

[20]

The
    motion judge referred to the authority of
Club Resorts Limited v. Van Breda
,
    2012 SCC 17, [2012] 1 S.C.R. 572, noting that the onus is on the party asking
    for a stay to show that the alternative forum is clearly more appropriate.

[21]

The
    motion judge identified the non-exhaustive list of relevant factors identified
    in
Van Breda
, at para. 105: (a) the comparative convenience and
    expense for the parties to the proceeding and for their witnesses, in
    litigating in the court or in any alternative forum; (b) the law to be applied
    to issues in the proceeding; (c) the desirability of avoiding a multiplicity of
    legal proceedings; (d) the desirability of avoiding conflicting decisions in
    different courts; (e) the enforcement of an eventual judgment; and (f) the fair
    and efficient working of the Canadian legal system as a whole.

[22]

In
    support of his submission that England was a more appropriate forum, Hashemi
    advanced four main arguments. First, he asserted that he was resident in
    England and had only returned to Iran temporarily to clear his name in legal
    proceedings. Second, he contended that he would have no difficulty re-entering
    England, which had issued him temporary visas in the past, and that he would
    continue to be unable to enter Canada. Third, he emphasized Bouzaris nexus
    with England: Bouzari continued to have business and other connections in
    England and travelled there frequently. Fourth, he asserted that there were
    procedural advantages to his defence should the litigation take place in
    England. In support of this position, Hashemi submitted the opinion of an
    English barrister describing the available procedures for litigation in England,
    including those that would be available if Hashemi were unable to be present in
    person.

[23]

In
    response, Bouzari and his family made four main submissions. First, they relied
    on evidence that Hashemi had voluntarily returned to Iran and the absence of
    evidence as to when he would be able to leave Iran or whether he would be able
    to return to England. Second, they noted that the English barristers opinion,
    which dealt with alternatives to attending and testifying in person, anticipated
    that Hashemi would be unable to attend in England should his motion be granted.
    Third, Bouzari and his family asserted that any procedural advantages to
    Hashemi in litigating in England were outweighed by juridical disadvantages to
    the plaintiffs. Fourth, they claimed that if they were required to litigate in England,
    they would be deprived of their Toronto counsel and forced to retain English
    counsel at significant additional expense.

[24]

The
    motion judge noted that Hashemis submissions on the importance of his ability
    to properly conduct his defence would have been persuasive if supported by
    evidence. However, in the absence of evidence on Canadas and Englands immigration
    laws, she refused to accept Hashemis prior experiences of being denied
    admission to Canada and granted admission to England as evidence that Canada
    would deny him entry to defend himself, or that England would grant him entry
    for this purpose.

[25]

The
    motion judge found the evidence inconclusive regarding Hashemis ability to
    physically attend court in Ontario and England. Since she could not conclude
    that Hashemi would be unable to properly defend himself if the action remained
    in Ontario, she found that Hashemi had failed to meet the onus of providing the
    necessary evidence on what she described as an important point.

[26]

The
    motion judge considered the evidence respecting the location of proposed witnesses.
    She concluded that, while the evidence supported the conclusion that deferring
    to an English court might be helpful to such witnesses, it might deprive the
    plaintiffs of certain rights. In this regard she referred to the fact that the
    plaintiffs rely on Ontario and Canadian law, including international covenants
    ratified by the Government of Canada, while Hashemi had provided no evidence
    that international covenants relied on by the plaintiffs had been adopted under
    English law.

[27]

Ultimately,
    the motion judge concluded that Hashemi had not met his burden of proving
    England was clearly a more appropriate forum than Ontario.

D.

Developments During the Appeal to this Court

[28]

At
    the time the order under appeal was made, Hashemi was represented by Ontario legal
    counsel. He had delivered affidavits and an expert report, and attended
    cross-examinations via Skype. His participation in the proceedings changed,
    however, after his appeal to this court had been perfected.

[29]

The
    respondents brought a motion for security for costs and for an order for the
    unpaid costs that had been awarded by the court below. Justice Juriansz, in an
    endorsement dated June 17, 2014, described what had transpired:

The respondents motion came before the court on March 28 2014.
    Counsel for [Hashemi] filed an affidavit from his Iranian lawyer stating that
    if he provided substantive instructions to his Ontario counsel regarding the
    motion or the appeal, his bail could be revoked and he could be returned to
    prison. The affidavit claims that prosecuting authorities in Iran have
    interpreted certain audio recordings, purportedly of [Hashemi], as statements
    against national security. It suggests that these same audio recordings were
    potential evidence in the Ontario action, and that Mr. Bouzari was involved in
    releasing them. Therefore, Iranian prosecutors might construe participation in
    the Ontario action as an attempt to interfere with evidence or witnesses
    involved in [Hashemis] prosecution, contrary to Irans
Criminal Code of
    Procedure
. On this basis, Hoy A.C.J.O. adjourned the motion until May 28,
    2014 and vacated the pending appeal date of June 18, 2014.

[30]

Justice
    Juriansz made an order removing counsel for Hashemi from the record because of
    their inability to obtain instructions. The unopposed motion for security for
    costs proceeded, but the relief sought was refused.

[31]

On
    June 30, 2014, Hashemis Iranian counsel swore an affidavit confirming the
    continuation of the existing barriers and stating that Hashemi had authorized
    him to receive all letters or documents addressed to Hashemi, which he would
    provide to his client only with permission from Irans public prosecutors
    office. On July 11, 2014, Hashemi delivered a notice of intention to act in
    person in this court, with his Iranian counsels contact information as his
    address for service.

[32]

On
    July 28, 2014, Juriansz J.A. refused to revisit his earlier decision denying
    security for costs, and ordered that a new date be obtained for the hearing of
    the appeal. That date was fixed for October 23, 2014.

[33]

In
    an affidavit sworn October 12, 2014, Hashemis Iranian lawyer confirmed that
    the existing barriers on Hashemi remained in place, and that without permission
    from Irans public prosecutors office, he could not communicate with any
    foreign lawyer with respect to the litigation. The affidavit indicated that
    communications respecting the matter would have to continue to occur through
    the Iranian lawyer. The affidavit also stated that the lawyer was informed
    that a U.K. visa has been issued for Mr. Hashemi, which enables him to defend
    himself in England, in case his appeal for change of forum will be successful,
    and that the follow-ups on his Canadian visa, requested for a second time in
    June 2012, remained unanswered.

[34]

Hashemi
    did not attend, nor was he represented by counsel at, the hearing of this
    appeal.

E.

Issue ON APPEAL

[35]

Prior
    to the hearing of this appeal, the panel contacted the parties to invite argument
    on the question of whether Ontario has jurisdiction
simpliciter.
Although we heard argument from counsel for the respondent on this issue, it is
    unnecessary and inappropriate in our view to address the question of whether
    jurisdiction
simpliciter
was properly assumed in this case. In our
    view, the contours of the nascent jurisprudence regarding forum of necessity
    would best be decided in a case in which jurisdiction
simpliciter
on
    this basis has been directly raised and argued by the parties.

[36]

In
    the present case, the appellants challenge to the jurisdiction of the Superior
    Court of Ontario was limited. In his motion to set aside the default judgment,
    Hashemi made no objection to the jurisdiction
simpliciter
of the
    Superior Court. His sole objection was that Ontario was not the
forum
    conveniens
. The motion judges decision deals only with that issue. The
    appellants factum argues that the motion judge erred, and that England, and
    not Ontario, is the
forum conveniens
for the action.

[37]

Accordingly,
    the issue in this appeal is whether the motion judge erred in her determination
    with respect to
forum non conveniens.

F.

Analysis

[38]

The
    motion judges conclusion that Hashemi had not met the burden of proving that
    England was clearly the more appropriate forum is discretionary. The decision
    is worthy of deference, absent an error of law or a clear and serious error in
    the determination of the relevant facts:
Van Breda
, at para. 112.

[39]

In
    our view, the motion judge made two significant errors in the determination of
    the relevant facts. The first was in relation to Hashemis relative ability to
    travel to England and to Canada to defend proceedings.

[40]

Hashemis
    efforts, with the assistance of U.K. counsel, to obtain a temporary visa to
    enter Canada for the purpose of defending this action, as well as efforts by
    the respondents counsel to obtain a short-term special ministerial visa or
    permit, were unsuccessful.

[41]

The
    motion judge observed that Hashemis submissions on the importance of his
    ability to properly conduct his defence would be persuasive if they could be
    supported by the evidence. She noted his assertion that, while he may be able
    to attend in the English court in the future, he could not attend in the
    Ontario court. She then stated:

In my view, the evidence does not support these claims. The
    evidence is that he was denied entry into Canada in the past. There was no
    evidence that it is unlikely that Hashemi would be admitted into Canada in the
    future. The court is asked to make inferences on these points - that is,
    because Hashemi was denied entry into Canada in the past, he will be denied
    entry in the future, and because he was admitted to England in the past, he
    will be allowed to attend a trial in England. There was no evidence with
    respect to the immigration laws of Canada or of England. I do not accept that
    these are proper inferences to make on the evidence in this case.

[42]

With
    respect, we find this reasoning unreasonable. Accepting there is always some
    uncertainty about the future, in our view the evidence that Hashemi was twice
    denied visas to enter Canada for the very purpose of participating in these
    proceedings amply supports the inference that he will be denied entry in the
    future. We fail to understand how evidence with respect to the immigration laws
    of Canada could assist a court in determining how discretion under those laws
    will be exercised in the future any better than how the discretion has already
    been exercised.

[43]

In
    our view the reasonable conclusion is that Hashemi will not be admitted to Canada
    to defend this action. On our reading of the decision, the motion judges
    conclusion on an important factor - Hashemis ability to defend himself in each
    country - turned on this faulty reasoning.

[44]

The
    motion judge also erred in her treatment of the relative procedural advantages afforded
    by each jurisdiction. After reviewing the location of the proposed witnesses of
    the parties, she concluded that deferring to an English court might be helpful
    to Hashemis witnesses, but might deprive the respondents of certain rights.
    She noted that the respondents relied on Ontario and Canadian law, including
    international covenants ratified by the Government of Canada, while Hashemi had
    provided no evidence that international covenants relied on by the plaintiffs
    had been adopted under English law.

[45]

With
    respect, it was not Hashemis burden to prove that English law is the same as
    or would afford the same benefits as, Canadian law. The respondents adduced no
    evidence on the motion that an English court would apply English law, rather
    than the substantive law of Ontario or indeed Iran, the
lex loci delicti
,
    and that, if English law were to apply, that its provisions would result in a
    juridical disadvantage.

[46]

In
    any event our court has observed that, while the loss of a juridical advantage
    to a party
can be a relevant
    consideration in the
forum conveniens
analysis, it is a concept that should be applied with
    some caution, having regard to the principle of comity and an attitude of
    respect for the courts and legal systems of other countries, many of which have
    the same basic values as us:
Prince v. ACE Aviation Holdings Inc
.,
    [2014] O.J. No. 1792 (C.A.) at para. 64, citing
Van Breda
, at para.
    112.

[47]

Having
    concluded that the motion judge committed reversible errors, it is our task to
    conduct a fresh analysis of the
forum non conveniens
question. The objectives
    in determining the appropriate forum are to ensure fairness to the parties and
    to provide an efficient process for resolving their dispute:
Van Breda
,
    at para. 109. In our view both of these objectives would be better met through
    litigation in England.

[48]

The
    only factor that connects this proceeding to Ontario is that the respondents
    reside here. They prefer to litigate here, with the assistance of legal counsel
    that they have already retained. Hashemi however has no connection whatsoever
    to Ontario or Canada, and once he is able to leave Iran he will have no ability
    to enter this country to attend trial or otherwise participate in person in
    these proceedings.

[49]

On
    the other hand, both parties have some connection to England. The respondent
    lived there for three years, still has real property there, operates a business
    there that is his source of income, and travels there often. While Hashemi is
    now in Iran in unclear circumstances, his evidence before the motion judge was
    that he was resident in England and had temporarily returned to Iran to clear
    his name in legal proceedings there. As at September 2012, he had held a series
    of visas permitting him to enter England for approximately a decade.

[50]

With
    one exception, all the witnesses, except the respondents, reside outside of
    Canada. Most are in Iran or in Europe. Leaving aside the relative advantage of
    the English court in compelling the attendance of witnesses from Europe, a
    trial in England would require much less travel when all participants are
    considered.

[51]

The
    respondents counsel points out that Hashemi has been in Dubai, Australia,
    England, and is now in Iran. He submits that a plaintiff should not have to
    chase a defendant around the globe; the location of the defendant should not
    govern where an action should proceed. Certainly it seems that the appellants
    location and status are unpredictable and subject to change, but it is
    significant that, in his affidavits challenging proceedings in Ontario, he has
    already consented to the action proceeding in England.

[52]

The
    respondents place great emphasis on the fact that Hashemi cannot leave Iran at
    this point. As such, they argue, he would be compelled to participate in the
    proceedings remotely, whether they occur in Ontario or in England. The evidence
    is that similar procedures are available in both jurisdictions for
    videoconferencing and other electronic means for giving evidence outside of the
    courtroom. While it may be the case at present that Hashemi is equally unable
    to attend in Ontario and in England, it may be several years before a trial
    will take place. The possibility that Hashemi will be able to attend trial in
    England when weighed against the certainty that he will not be able to attend
    in Ontario militates in favour of England as the preferable forum.

[53]

Finally,
    other factors, such as choice of counsel in a partys preferred forum would
    seem to apply to both parties.

[54]

Having
    determined that the motion judge erred in two significant findings that
    affected her decision, and having conducted our own review of the relevant
    circumstances, we would set aside the motion judges decision and conclude
    instead that England is the more appropriate forum for the litigation of the
    respondents claims.

G.

Conclusion

[55]

For
    the reasons given, the appeal is allowed. The respondents action in Ontario is
    stayed so that proceedings may be pursued by the respondents in England. There will
    be no costs of the appeal.

Released: April 21 2015

(RGJ)
    R.G. Juriansz J.A.

Paul Rouleau J.A.

K. van Rensburg J.A.

[1]
In 2000, the respondents sued the Islamic Republic of Iran. The action, which
    was not defended and in which the Attorney General of Canada intervened, was
    dismissed because s. 3 of the
State Immunity Act
, R.S.C. 1985, c.
    S-18, bars claims based on torture in a foreign state:
Bouzari v. Iran
    (Islamic Republic)
, [2002] O.J. No. 1624. This court upheld the dismissal,
    and the Supreme Court denied leave to appeal: (2004), 71 O.R. (3d) 675 (C.A.),
    leave to appeal to S.C.C. refused, [2004] S.C.C.A. 410.


COURT OF APPEAL FOR ONTARIO

CITATION: Brown v. Lloyd's of London Insurance Market, 2015
    ONCA 235

DATE: 20150409

DOCKET: C59949

Cronk, Gillese and Brown JJ.A.

BETWEEN

Gary
    David Brown, a.k.a. Gary David Robert Brown,

Station
    Attendant Emeritus

Plaintiff/Appellant on Appeal

and

Lloyds of London Insurance Market and/or its
    agents for Ontario Granite Global Solutions LP and/or Granite Claims Solutions
    formerly known as McLarens Canada (Lloyds), Law Society of Upper Canada
    (L.S.U.C.), Lawyers Professional Indemnity Company (Law Pro), University
    of Toronto (U of T), Toronto Dominion Bank Group (TD Bank), City of Toronto
    (Toronto), Canada Post Corporation (Canpost), West Neighbourhood House
    (WestNH), Police Association of Ontario (P.A.O.), Her Majesty the Queen in
    Right of Ontario (Ontario), Former Landlord of the Plaintiff Mr. A.
    Esden-Tempski and any and all past and present officers, directors, assigns,
    agents and, where applicable, such syndicates, partners, practitioners,
    licensees, etc., therefor and, but without limitation, such successors, heirs
    and estates of same

Defendants/Respondents on Appeal

Gary David Brown, In Person

R. Lee Akazaki, for the respondent, Granite Global Solutions LP
    and/or Granite Claims Solutions formerly known as McLarens Canada

George Benchetrit, for the respondent, Lloyds of London
    Insurance Market

Susan M. Sack, for the respondent, the Law Society of Upper
    Canada

Debra Eveleigh, for the respondent, Lawyers Professional
    Indemnity Company

William M. Pepall and Lucas E. Lung, for the respondent,
    University of Toronto

Jonathan A. Odumeru, for the respondent, Toronto-Dominion Bank
    Group

Kevin A. McGivney and Jonathan Chen, for the respondent, City of
    Toronto

Sebastian Schmoranz and Aaron S. Murray, for the respondent,
    Canada Post Corporation

Kate Findlay, for the respondent, West Neighbourhood House

Joanna Birenbaum, for the respondent, Police Association of
    Ontario

Fatema Dada, for the respondent, Her Majesty the Queen in right
    of Ontario

A. Esden-Tempski, In Person

Heard in writing: March 9, 2015

On motion under Rule 2.1 of the
Rules of Civil
    Procedure
, R.R.O. 1990, Reg. 194, for consideration of the appeal from the
    order of Justice Frederick L. Myers of the Superior Court of Justice, dated
    January 5, 2015.

ENDORSEMENT

[1]

By Notice of Appeal dated February 2, 2015, the appellant, Gary David
    Brown, a.k.a. Gary David Robert Brown Station Attendant Emeritus, appealed
    from the order of Myers J. of the Superior Court of Justice, dated January 5,
    2015, dismissing the appellants action under Rule 2.1 of the
Rules of
    Civil Procedure
, R.R.O. 1990, Reg. 194, as against all defendants except
    the defendant A. Esden-Tempski, the appellants former landlord, on the basis
    that the action was frivolous and vexatious and [could not] possibly succeed.

[2]

On February 18, 2015, the Registrar of this court notified the appellant
    that his appeal may be stayed or dismissed pursuant to Rule 2.1, on similar grounds.
    The appellant delivered written submissions responding to the Registrars Rule
    2.1 notice.

[3]

Under Rule 2.1, this court may stay or dismiss a proceeding that appears
    on its face to be frivolous or vexatious or otherwise an abuse of the process
    of the court.  Having reviewed the appellants submissions and those of the
    respondent, the Toronto-Dominion Bank, as well as the appellants pleading and
    the motion judges reasons, we are satisfied that the appellants appeal is
    frivolous and vexatious or otherwise an abuse of the courts process and,
    therefore, that it should be dismissed on the authority of Rule 2.1.

[4]

The motion judge held that: i) the appellants statement of claim
    contains no intelligible claims against any of the defendants except possibly
    his former landlord [the defendant, A. Esden-Tempski]; and ii) apart from the
    claims concerning Mr. Esden-Tempski, the incidents pleaded and the relief
    sought in relation to them concern the redesign [of] the social welfare and
    legal services systems of Ontario.  The motion judge therefore held that it
    is self-evident on the face of the claim that it is frivolous and vexatious and
    cannot possibly succeed as against all of the defendants except, possibly, Mr.
    Esden-Tempski.

[5]

Accordingly, the motion judge dismissed the appellants action as
    against all defendants, except Mr. Esden-Tempski, and struck the appellants
    statement of claim in its entirety, with leave to the appellant to deliver an
    amended statement of claim within 60 days limited to claiming relief known to
    law against his former landlord.

[6]

We agree with the motion judges characterization of the appellants
    action and with his assessment of the appellants pleading.  With the possible
    exception of the claims sought to be advanced against Mr. Esden-Tempski, the
    allegations in the appellants pleading, to the extent that they are
    discernable, and the associated relief claimed are either non-justiciable or
    fail to disclose a reasonable cause of action within the meaning of the
Rules
.

[7]

In his Notice of Appeal, the appellant advances two grounds of appeal
    from the motion judges order: i) complaints of alleged procedural
    irregularities, for example, that several defendants, having filed Notices of
    Intent to Defend the appellants action, failed to deliver Statements of
    Defence or to respond to his offer to settle; and ii) that the motion judge
    erred, trivialized or wantonly misquoted the appellant in his reasons.

[8]

In his written submissions responding to the Registrars Rule 2.1 notice
    in this court, the appellant further alleges that: i) Rule 2.1 should be
    repealed or revoked; ii) one or more of the defendants may seek to cause him
    future harm; iii) the appellant is being denied access to justice; and iv)
    other homeless people in Ontario have endured sufferings similar to those
    experienced by the appellant.

[9]

None of the matters raised by the appellant in his Notice of Appeal and
    responding submissions, described above, constitutes a ground of appeal tenable
    at law from the motion judges ruling.  The appellants complaints either
    misconstrue the requirements of the
Rules
, mischaracterize the motion
    judges reasons, or raise speculative and/or bald assertions of past or future
    alleged injury to himself or others.

[10]

Like
    the motion judge, we conclude that while one might empathize with some of the
    appellants concerns and suggested experiences, they do not disclose actionable
    complaints, as pleaded.  Nor do they afford a viable ground of appeal from the
    motion judges order.

[11]

In
    these circumstances, the appellants appeal must be dismissed under Rule 2.1.
    Both the appellants underlying action and his proposed appeal are so devoid of
    potential merit as to be frivolous and vexatious and an abuse of the courts
    process on their face, save only with respect to the appellants proposed
    claims against Mr. Esden-Tempski.  There can be no reasonable expectation that,
    should the appeal proceed, the appellant could obtain the relief he seeks.

[12]

For
    these reasons, this is an appropriate case for invocation of Rule 2.1 in
    relation to the appellants proposed proceeding in this court.  The appellants
    appeal is therefore dismissed.

[13]

This
    is not an appropriate case for any award of costs in relation to this Rule 2.1
    motion.  The court dispenses with the need for the respondents to seek the
    appellants approval as to the form and content of this courts order.

E.A. Cronk J.A.

E.E. Gillese J.A.

David Brown J.A.