COURT OF APPEAL FOR ONTARIO

CITATION: Buccilli v. Pillitteri, 2014 ONCA
    337

DATE: 20140429

DOCKET: M43697 (C56408)

Rouleau J.A. (In Chambers)

BETWEEN

Patricia Buccilli and Drapery Interiors Etc. Inc.

Plaintiffs (Respondents)

and

Pasquale Pillitteri also known as Pat Pilliteri,
    Christina Pilliteri, Patron Contracting Limited also known as CDC Contracting,
    Birchland Homes Inc. and Vendrain Inc.

Defendants (Appellants)

Anna Husa, for the appellants

M.R. Kestenberg, for the respondents and moving parties
    on cross-motion to enforce a settlement

Terrence OSullivan, for the proposed intervenors, Retano
    (Ron) Ventura and 1796248 Ontario Inc.

Heard: April 25, 2014

On motion for leave to intervene as parties on the appeal
    from the judgment of Justice Frank J.C. Newbould of the Superior Court of
    Justice, dated November 23, 2012, with reasons reported at 2012 ONSC 6624, and
    cross-motion to enforce a settlement.

Rouleau J.A.:

[1]

These reasons deal with both the motion for leave to intervene and the cross-motion
    to enforce a settlement. The motion for leave to intervene is brought by Renato
    Ventura (Ron), brother and brother-in-law of, respectively, Christina
    Pillitteri (Christina) and Pat Pillitteri (Pat), the individual appellants
    on the underlying appeal. Ron moves for leave to intervene, seeking party
    status in the appeal for himself personally and for 1796248 Ontario Inc.
    (179), a company he owns and controls. That motion is opposed by Patricia
    Buccilli (Patricia) and her company Drapery Interiors Etc. Inc. (Drapery
    Interiors), respondents on the appeal, who bring a cross-motion pursuant to rule
    49.09 of the
Rules of Civil Procedure
, R.R.O. 1990, Reg. 194, to
    enforce an alleged settlement of the proposed motion for leave to intervene.

[2]

For the following reasons, the motion for leave to intervene is granted
    and the cross-motion dismissed.

BACKGROUND IN BRIEF

[3]

The underlying dispute concerns a family business. Patricia was married
    to Lorenzo Ventura (Enzo), Rons brother. Enzo, Ron, and Pat owned and
    operated Patron Contracting Limited, also known as CDC Contracting (CDC), and
    Birchland Homes Inc. (Birchland). Each was a one-third shareholder in CDC and
    Birchland.

[4]

In September 1998, Enzo died in a construction accident. Patricia inherited
    her late husbands estate and thus became a one-third shareholder in CDC and
    Birchland.

[5]

In June 2001, Patricia entered into a transfer agreement with Christina,
    transferring to her, in trust, Enzos one-third interest in CDC and Birchland,
    as well as his interest and ownership rights in various real estate holdings.
    Subsequently, that one-third interest in CDC and Birchland, formerly held by
    Enzo, was transferred half and half to Ron and Pat, respectively. Rons shares
    in CDC are now held by 179; he continues to hold his shares in Birchland
    personally.

[6]

In 2008 Patricia brought an action against Christina, Pat, CDC, and
    Birchland, seeking to have the transfer agreement set aside. Neither Ron nor
    179 were parties to the action.

[7]

In accordance with a bifurcation order dated October 26, 2009, a trial
    on liability was to proceed first, followed if necessary by a trial on damages.
    Following the trial on liability, the trial judge released his reasons on
    November 23, 2012, finding in favour of the respondents (Patricia and Drapery
    Interiors). In the judgment that issued pursuant to these reasons, the trial
    judge orders, in part, that the transfer agreement of June 2001 is set aside,
    that Patricia is entitled to a one-third (1/3) interest in CDC Contracting and
    Birchland Homes Inc. and of all money, benefits and opportunities withdrawn or
    diverted by Christina Pillitteri or Pat Pillitteri, either directly or
    indirectly, from CDC and Birchland, and that an accounting is to be taken to
    determine Patricias entitlement. The appellants filed a Notice of Appeal on
    December 20, 2012.

[8]

By orders dated April 9 and 17, 2013, the trial judge appointed Ernst
    & Young (E & Y) as court expert to help perform the accounting of
    Patricias entitlement pursuant to the judgment, with E & Ys invoices to
    be submitted to CDC. When the invoices submitted by E & Y ran considerably
    over the agreed-upon budget, the appellants filed a motion for a stay pending
    the outcome of the appeal. Ron supported the appellants on that motion and made
    submissions to that effect.

[9]

In September 2013 Ron told the respondents that he intended to intervene
    in the appeal. He would, however, wait to see the terms of the formal judgment
    before deciding. That judgment was not settled until January 2014.

[10]

On
    November 29, 2013, Gillese J.A. granted the motion for a stay pending
    disposition of the appeal. At para. 27, she stated the following with respect
    to Ron: Although Ron is not a party to the proceedings, the liability trial
    decision has had a direct impact on his rights and interests.

[11]

In
    February 2014, Ron prepared materials for the purpose of filing a motion to
    intervene. The motion was not filed at that time, but counsel for Ron had some
    discussions with counsel for Patricia about the possibility that it would be
    filed. On March 20, 2014, counsel for Ron sent a letter to counsel for Patricia
    explaining Rons concerns that the trial judges liability judgment could be
    interpreted as affecting Rons ownership of shares in CDC and Birchland.
    Counsel for Ron made the following proposal to counsel for Patricia:

Will your client agree that, to the extent Justice Newboulds
    judgment is interpreted as transferring Mr. Venturas shares, it should be
    scaled back so that it does not have that effect? If so, then there would no
    longer be a need for Mr. Ventura to intervene, and he is willing to withdraw
    his intervention motion provided that you undertake to advise the panel of the
    basis for doing so.

[12]

The
    following day, March 21, 2014, counsel for Patricia responded, in part:

I wish to confirm that our client has agreed to the terms of
    your letter, in particular the second last paragraph of your letter such that
    our client agrees that to the extent that Justice Newboulds judgment is
    interpreted as transferring Mr. Venturas shares it will be scaled back on
    consent so that it does not have that effect.

[13]

Shortly
    after this exchange, counsel for the appellants advised that although the
    appellants position on appeal is that it was improper for the judgment to
    affect Ron and 179, there would be no agreement as to what scaling back might
    mean and the appellants would oppose any order on appeal that varied the
    judgment only with respect to its effect on Ron and 179.

[14]

On
    April 2, 2014, counsel for Ron wrote to counsel for Patricia stating that, on
    further reflection, he was not persuaded that we can protect the interests of
    our client without being present at the Court of Appeal. On April 7, 2014, counsel
    for Ron served notice of the present motion for leave to intervene.
    Specifically, the motion seeks to have Ron and his company, 179, added as
    parties to the appeal. Patricia filed a cross-motion pursuant to rule 49.09,
    seeking to enforce the purported agreement not to intervene, on the ground that
    it was an accepted offer to settle the motion, within the meaning of Rule 49.

ISSUES

[15]

The
    issue before the court is whether, in light of the criteria set out in rule
    13.01, Ron and 179 ought to be granted leave to intervene as added parties in
    the appeal. In reaching my decision I need to consider whether the respondents
    accepted an offer to settle from, or otherwise reached an enforceable agreement
    with, Ron such that Ron and 179 should be precluded from moving to intervene
    pursuant to rule 13.01.

ANALYSIS

[16]

Rule
    13.01 provides:

13.01
(1) A person who is not a party to a
    proceeding may move to intervene as an added party if the person claims,

(a) an interest in the subject
    matter of the proceeding;

(b) that the person may be
    adversely affected by a judgment in the proceeding; or

(c) that there exists between the
    person and one or more of the parties to the proceeding a question of law or
    fact in common with one or more of the questions in issue in the proceeding.

(2) On the motion, the court shall consider whether the
    intervention will unduly delay or prejudice the determination of the rights of
    the parties to the proceeding and the court may add the person as a party to
    the proceeding and may make such order as is just.

[17]

As
    noted above, Gillese J.A. was of the view that Rons rights and interests were
    directly affected by the trial judges liability judgment. I agree that it is
    at least arguable that, by setting aside the transfer agreement between
    Patricia and the Pillitteris, and by ordering an accounting, the judgment may
    affect Rons interests and, specifically, may void the transfer to Ron of one
    half of Enzos former interests in CDC and Birchland. The issue of the
    liability judgment affecting a non-party has in fact been raised by the
    appellants in the current appeal.

[18]

As
    to the issue of prejudice or delay, this motion has been brought late in the
    proceedings and risks causing delay. Patricia notes, in addition, that Ron was aware
    of the trial and must have been aware of the broad substance of the pleadings
    well before then.

[19]

Ron,
    for his part, notes that he formally notified the parties in September 2013
    that he was considering seeking leave to intervene. Ron and 179 have agreed to
    accept the record as is and ask only to file a factum. Both the appellants and
    Ron and 179 have agreed not to seek an adjournment of the scheduled hearing of
    the appeal.

[20]

The
    respondents advance three principal reasons why the motion for leave to
    intervene should be dismissed. First, on their cross-motion the respondents
    argue that the exchange of letters between counsel, discussed above, shows that
    there was a valid settlement of the proposed motion to intervene and that
    settlement should be enforced pursuant to rule 49.09. Second, the respondents
    submit that Rons rights and interests are not automatically affected by the
    judgment, and that Ron would in any case be able to protect his rights and
    interests at the damages phase of the trial. Finally, the respondents submit
    that given the delay in filing the motion for leave to intervene, the court
    should exercise its discretion to dismiss the motion.

I will deal with each of these grounds in turn.

Whether there exists a valid Rule 49 settlement

[21]

The
    respondents bring their cross-motion pursuant to rule 49.09, which reads, in
    relevant part:

49.09
Where a party to an accepted offer to
    settle fails to comply with the terms of the offer, the other party may,

(a) make a motion to a judge for judgment in the terms of
    the accepted offer, and the judge may grant judgment accordingly;

[22]

The
    respondents argue that rule 49.09 applies to the offer purportedly contained in
    and accepted through the exchange of letters noted above, because Ron is a
    party to [that] accepted offer even if he was not at the time a party to any
    relevant proceeding or motion before the court.

[23]

Rule
    49.02 provides as follows:

49.02
(1) A party to a proceeding may serve on
    any other party an offer to settle any one or more of the claims in the
    proceeding on the terms specified in the offer to settle (Form 94A).

(2) Subrule (1) and rules 49.03 to 49.14 also apply to motions,
    with necessary modifications.

[24]

In
Scanlon v. Standish
(2002), 57 O.R. (3d) 767 (C.A.), this court found,
    at para. 8, that these words contemplate the existence of pending litigation and
    that [a]bsent an application or action, the Rules of Civil Procedure, by their
    own definition, have no application to disputes between citizens. In
Scanlon
the litigation was only contemplated at the time of the alleged settlement. This
    led to the courts conclusion, at para. 22: A pre-litigation offer  is not a
    Rule 49 offer. This holding was later confirmed in
McBride Metal
    Fabricating Corp. v. H & W Sales Co.
(2002), 50 O.R. (3d) 97 (C.A.).

[25]

Until
    Ron is given intervenor status, he is not a party to the litigation. Further,
    when counsel exchanged the letters noted above there was no pending motion. In
    my view, therefore, the exchange of letters cannot constitute a Rule 49 offer
    and acceptance. Assuming it forms a binding agreement, however, it can be taken
    into account in deciding whether to exercise my discretion on the motion for
    leave to intervene.

[26]

Even
    supposing that counsels exchange of letters constitutes a valid Rule 49 offer
    to settle and acceptance, I would not exercise my discretion to enforce it. In
    purporting to accept Rons offer, counsel for the respondents wrote, in part,
    that our client agrees that to the extent that Justice Newboulds judgment is
    interpreted as transferring Mr. Venturas shares it will be scaled back
on
    consent
so that it does not have that effect (emphasis added).

[27]

Rons
    counsel maintains that, to be effective, the settlement agreement must be
    agreed to by the appellants because varying the trial judges liability
    judgment on consent requires the consent of all parties to the litigation. It
    is clear that the appellants are not consenting and will not consent to any
    scaling back. Although the respondents argue that consent is not required, it
    is not clear to me that the respondents can, alone, ensure that the result they
    and Ron agreed upon can be obtained without the consent of the appellants or
    the agreement of the court. Finally, there seems to be confusion as to what
    scaling back a judgment means. Ron argues that his interests can be affected
    both directly through an order requiring the transfer of some of the shares and
    indirectly because of the impact of the judgment on the value and assets of CDC
    and Birchland. In my view, the settlement is not clear on this point.

[28]

In
    these circumstances, even if I were to accept that the agreement could come
    within Rule 49, I would conclude that it is not enforceable and would therefore
    not enforce it.

Whether Rons interests are
    automatically affected

by

judgment

[29]

The
    respondents submit that Rons rights and interests are not automatically
    affected by the trial judges liability judgment. The respondents advance at
    least two reasons in support of this submission. First, because the trial on
    damages has yet to take place, Ron will have the opportunity to defend his
    interests. The respondents do not oppose Ron and 179 appearing as parties at
    that stage of the trial. Second, the respondents have agreed to advise this
    court at the hearing of the appeal and the trial judge at any future trial on
    damages that, insofar as the judgment on liability can be interpreted as
    affecting Ron and 179s interests in CDC and Birchland, the respondents support
    the scaling back of the judgment on liability to obviate any impact on Ron
    and 179s interests.

[30]

Ron
    and 179, supported on this point by the appellants, respond that the liability judgment
    is at least open to an interpretation on which it affects Rons rights and
    interests, and the respondents cannot unilaterally scale back the trial
    judges liability judgment in the sense of varying the judgment. In other
    words, the respondents are not in a position to deliver on a promise that Rons
    rights and interests will not be affected by the liability judgment and will
    not be affected by the outcome of the appeal.

[31]

I
    cannot prejudge the outcome of the appeal or that of the damages portion of the
    trial. Justice Gillese has already ruled that the outcome of the appeal may have
    an impact on Rons interest in CDC and Birchland. All that rule 13.01(1)
    requires is that a person may be adversely affected or that there exists
    between the [proposed intervenor] and one or more of the parties to the
    proceeding a question of law or fact in common with one or more of the
    questions in issue in the proceeding. In the appeal the appellants have
    clearly raised the issue of the impact of the judgment on Ron. It may well be
    that through the mechanisms they propose, the respondents will succeed in
    convincing this court and the judge hearing the damages trial that Rons
    interests are not and should not be affected. However, the appellants have not
    agreed to support that position and the issue is squarely before the court on
    the appeal. It is not for me to speculate on the outcome of the appeal and, in
    the circumstances, it seems to me that the respondents cannot ensure any
    specific outcome at the appeal or in the damages trial. As a result, I conclude
    that Ron has met the requirements of rule 13.01(1).

Whether unnecessary delay in bringing the motion warrants
    dismissal

[32]

Finally,
    the respondents argue that Ron and 179 have waited too long to bring this
    motion for leave to intervene, and that the court should accordingly exercise
    its discretion not to grant leave.

[33]

I
    am troubled by the lateness of this motion. The respondents ought not to have
    had to argue the motion one week before the scheduled hearing of the appeal,
    and be left with only a few days to consider Rons factum and be in a position
    to respond in court. The underlying action was brought in 2008 and counsel for
    the respondents understandably expresses frustration at the possibility of an
    adjournment.

[34]

The
    position to be taken by Ron on the appeal will not, however, take the respondents
    totally by surprise. It overlaps considerably with a position already advanced
    by the appellants. The appeal therefore may well proceed as scheduled.
    Additionally, little prejudice would accrue to the respondents if they decide
    to request a short adjournment of the appeal. Ron and the appellants have
    indicated that they will not seek an adjournment but would consent to an
    adjournment request by the respondents if, after reviewing Rons factum, the
    respondents need additional time to prepare for the appeal. In the
    circumstances, while the delay in bringing the motion is unfortunate, I do not conclude
    that it warrants dismissal of the motion.

CONCLUSION

[35]

The
    motion for leave to intervene is granted. The cross-motion is dismissed. Ron
    and 179 are added as parties on the appeal. They are to file a factum of not
    more than 15 pages by Monday, April 28, 2014, and are not to add to the record.

[36]

Counsel
    for the respondents will notify the court by Tuesday, April 29, 2014, if after
    receipt of Rons factum they desire an adjournment. Although Ron was successful
    on the motions, I am not prepared to award him costs. He delayed in bringing
    the motion and, although I have concluded that there is no binding Rule 49
    settlement, the respondents did not act unreasonably in maintaining that they
    had resolved matters with Ron. The appellants do not seek costs. There will,
    therefore, be no order as to costs.


COURT OF APPEAL FOR ONTARIO

CITATION: Choquette v. Choquette, 2014 ONCA
    290

DATE: 20140415

DOCKET: C57689

Juriansz, Epstein and Pepall JJ.A.

BETWEEN

Nelson
    Choquette, William Choquette,

Neils
    Auto Body and Sales Limited,

1585133 Ontario Limited
    and 998050 Ontario Inc.

Plaintiffs (Respondents)

and

Sharon Choquette
, Anthony Pace also known as Tony Pace,

Pace
    Mortgage Services Inc., S
alvatore Fedele, ABC Towing
    &

Storage Inc., 1830950 Ontario Inc.
, Beverly Pace also
    known as

Beverly
    Dianne Powell, 1208187 Ontario Ltd., 1503483 Ontario Inc.,

1529240
    Ontario Corp., 1875664 Ontario Inc., Hughgo Investments Inc.,

Colin
    Bryan, Judith Hall, Lindsay Harrison and Giuseppe Baglieri

also known as Joseph
    Baglieri

Defendants (Appellants)

Rick Simmons, for the appellants

Matthew Moloci and R. Brent Marshall, for the
    respondents

Heard: April 14, 2014

On appeal from the order of Justice Gisele M. Miller of
    the Superior Court of Justice, dated August 27, 2013.

APPEAL BOOK ENDORSEMENT

[1]

The appellants do not take issue with the partial summary judgment
    granted, but argue the motion judge erred by refusing to stay the judgment
    until all the litigation between the parties was resolved. The refusal to stay
    the judgment was an exercise of the motion judges discretion. We are not
    persuaded there is any basis to interfere. The appeal is dismissed.

[2]

Costs are fixed in the amount of $7,500 all inclusive.


COURT OF APPEAL FOR ONTARIO

CITATION: Craven v. Osidacz, 2014 ONCA 329

DATE: 20140425

DOCKET: C56950

MacPherson, Blair and Pepall JJ.A.

BETWEEN

Julie Craven
,
John Craven
, Maureen Craven, Sean Craven and Louise
    Huzul

Plaintiffs (
Respondents
)

and

Michael Osidacz, Elizabeth Osidacz,
Richard Chmura
, Lisa Chmura and Lindsey Andraza

Defendants (
Appellant
)

Richard Chmura, appearing in person

Michael Jaeger, for the respondents

Heard and released orally: April 22, 2014

On appeal from the order of Justice Robert J. Nightingale
    of the Superior Court of Justice, dated March 28, 2013.

ENDORSEMENT

[1]

The appellant Richard Chmura appeals from the Order of Nightingale J. of
    the Superior Court of Justice dated March 28, 2013 granting in part the
    respondents motion for summary judgment.  In his decision, the motion judge
    struck out several paragraphs of the appellants Statement of Defence.

[2]

On the appeal, the appellant did not make oral submissions.  He relied
    on his factum and the extensive record he had submitted.

[3]

The appellant contends that the motion judge erred by striking out these
    paragraphs.  In particular, he contends that the motion judge erred by striking
    out his defence of truth (paragraph 16 of the Statement of Defence) on the
    basis that this component of his defence amounted to a collateral attack on the
    factual findings of Arrell J. in related proceedings.

[4]

We do not accept this submission.  We agree with the motion judge that
    there was nothing in the appellants motion record that would have raised a
    genuine issue requiring a trial relating to the March 18, 2006 incident
    involving Julie Craven and Andrew Osidacz.  In addition, we see no reason for
    interfering with the motion judges treatment of paragraphs 17, 18, 20, 21 and
    23 of the Statement of Defence.

[5]

In this appeal, the appellant is also seeking several other heads of
    relief that were not raised before the motion judge, including the reversal of previous
    orders of this court and the Superior Court of Justice, a declaration that all
    Ontario courts are biased against him, and the transfer of this matter to
    courts in Florida.

[6]

There is simply no basis for granting any of this relief.

[7]

The appeal is dismissed.  The respondents are entitled to their costs of
    the appeal fixed at $3600 inclusive of disbursements and HST.

J.C. MacPherson J.A.

R.A. Blair J.A.

S.E. Pepall J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Crosslink Bridge Corp. v. Canadian
    National Railway Company,

2014 ONCA 247

DATE: 20140401

DOCKET: C57905

Sharpe, LaForme and Tulloch JJ.A.

BETWEEN

Crosslink Bridge Corp.

Applicant (Appellant)

and

Canadian National Railway Company

Respondent (Respondent)

Chris G. Paliare and Alysha Shore, for the appellant

Mark Stewart and Marina Sampson, for the respondent

Heard: March 26, 2014

On appeal from the judgment of Justice John C. Murray of
    the Superior Court of Justice, dated October 24, 2013.

By the Court:

[1]

On December 18, 2006, the District Manager, Niagara District Office,
    Ontario Ministry of the Environment, made an order (the Directors Order) pursuant
    to the
Environmental Protection Act,
R.S.O. 1990, c. E.19 (the EPA),
    s. 18 requiring certain remedial work to be done on a parcel of land owned by
    the respondent CN. As contemplated by the EPA, s. 197(1), the Directors Order required
    CN, before dealing with the property in any way, to give a copy of the order
    or decision affecting the property to every person who will acquire an interest
    in the property as a result of the dealing. The Directors Order also required
    the registration in the land registry of a Certificate of Requirement pursuant
    to s. 197(2) and (3) to certify that a s.18 order had been made.

[2]

In May 2007 the appellant, Crosslink, made an offer to purchase the
    property. Following further negotiations and another offer, the sale of the
    property from CN to Crosslink was completed in November 2008.

[3]

Some four years later, Crosslink informed CN that it took the position
    that it had not been given a copy of the Directors Order and accordingly
    sought to avoid the transaction pursuant to the EPA, s. 197(4):

A dealing with real property by a person who is
    subject to a requirement imposed under subsection (1) or (3) is voidable at the
    instance of a person who was not given the copy of the order or decision in
    accordance with the requirement.

[4]

CN refused to void the transaction and this application followed.

[5]

The issue before the application judge was whether CN had given a copy
    of the Directors Order to Crosslink in compliance with the terms of the EPA
    and the terms of the Directors Order.

[6]

The application judge concluded that when all the evidence was
    considered, an inference could be drawn that Crosslink or its solicitors were
    provided with a copy of the Directors Order prior to closing the transaction.
    The application judge also found that even if the evidence did not establish
    that fact, the doctrine of promissory estoppel precluded Crosslink from
    bringing the application.

[7]

On appeal, Crosslink essentially relies on three submissions:

1.

the trial judge failed to apply the statutory onus imposed on CN to
    prove that it had provided Crosslink with a copy of the directors order;

2.

the trial judge erred by failing to draw an adverse inference against CN
    for having failed to call a witness;

3.

the doctrine of promissory estoppel was not pleaded or argued and in any
    event cannot be used to overcome a mandatory statutory provision.

1. Onus

[8]

At paragraph 57 of his reasons, the application judge listed twelve
    facts that, when considered as a whole, he found pointed overwhelmingly to an
    inference that CN had given Crosslink a copy of the Directors Order.  In our
    view, it was open on this record for the application judge to come to that
    conclusion. We do not agree that he made palpable and overriding errors that
    would justify appellate intervention.

[9]

Crosslinks submission as to the statutory onus essentially rests on the
    proposition that CN was required to establish precisely when, where and how it
    had given Crosslink a copy of the Directors Order. Crosslink contends that
    CNs case rested entirely on what it described as the attachment theory,
    namely that the Directors Order was attached the Certificate of Requirement
    that was included in the two boxes of material relating to the propertys environmental
    issues disclosed to Crosslink in March and August 2007.

[10]

Considerable
    time was spent on the application, and in oral argument before us, as to the
    state of the evidence on that point. The principals of Crosslink swore that the
    Directors Order was not included in the boxes, although it was not apparent
    how closely they had examined those materials. CNs evidence was that its
    representatives believed that the Directors Order had been attached to the
    Certificate of Requirement provided to Crosslink..

[11]

We
    note that the boxes contained very detailed information relating to the
    environmental problems for this property. It would have been apparent to
    Crosslink from the documents it admits receiving that there were serious
    environmental problems with the property. It would also have been apparent from
    the Certificate of Requirement, which was registered on title and specifically
    referenced in the Directors Order, that a Directors Order requiring remedial
    work had been made.

[12]

We
    do not agree that this case turns solely on the attachment theory. Nor do we
    accept the proposition that it was incumbent upon CN, four years later, to
    prove specifically when and how it gave Crosslink the Directors Order. In our
    view it was open to the trial judge to consider all of the evidence from which
    it could be inferred that CN had, at some point prior to the transfer of title,
    given Crosslink a copy of the Directors Order. We refer to the twelve points
    listed at para. 57 of the application judges reasons and, in particular, to
    the following facts:

·

Crosslink knew that  the Directors Order had been made;

·

there was full disclosure of the environmental reports that led
    to the Directors Order;

·

following a lengthy due diligence period, Crosslink waived all
    conditions with respect to the environmental condition of the property,
    acknowledged that CN had delivered all environmental reports in its possession
    and conclusively waived all requisitions concerning any matters relating to the
    property; and

·

before closing the transaction, Crosslink requisitioned a copy of
    the Order [t]o the extent not already provided and then failed to respond to
    CNs reply: [p]lease advise us if your client has not yet received a copy of
    this Order.

[13]

In
    our view, those facts provided a sufficient evidentiary record to support the
    application judges finding that CN had given Crosslink a copy of the
    Directors Order.

2. Adverse inference

[14]

We
    do not accept Crosslinks submission that the trial judge erred by failing to
    draw an adverse inference against CN for its failure to call Susan Sze, the CN
    employee who wrote the disclosure letters that accompanied the boxes of
    environmental reports provided to Crosslink. In answer to an undertaking given
    on his cross-examination, CNs real estate solicitor informed Crosslink that
    while Ms. Sze believed that she gave Crosslink a copy of the Directors Order
    together with the Certificate of Requirement, she had no specific recollection with
    regard to the production of this material that had taken place more than six
    years earlier. In our view, it was open to the application judge in his
    discretion to accept that explanation and to refuse to draw a negative
    inference.

3. Promissory Estoppel

[15]

As
    we see no error in the application judges finding that CN gave Crosslink a
    copy of the Directors Order, we do not find it necessary to consider whether
    there was any error with respect to the alternative ground of promissory
    estoppel.

4. Fresh Evidence

[16]

As
    the issue to which CNs fresh evidence application responded was not perused,
    the fresh evidence application is dismissed.

Disposition

[17]

Accordingly
    the appeal is dismissed. The respondent CN is entitled to its costs of the
    appeal fixed at $35,000 inclusive of disbursements and applicable taxes.

Robert J. Sharpe
    J.A.

H.S.
    LaForme J.A.

M.H. Tulloch J.A.

Released: April 1, 20114


COURT OF APPEAL FOR ONTARIO

CITATION: Di Michele v. Di
    Michele, 2014 ONCA 261

DATE: 20140403

DOCKET: C56711 and C56712

MacPherson, Cronk and Gillese JJ.A.

In the Matter of the
Partition
    Act
, R.S.O. 1990, c. P.4, ss. 2 and 3

And in the Matter of the
Mortgages
    Act
, R.S.O. 1990, c. M.40, s. 24

And in the Matter of the
Trustee
    Act
, R.S.O. 1990, c. T.23, ss. 5(1), 16(1) and 16(2)

And in the Matter of the
Rules
    of Civil Procedure
, R.R.O. 1990, Reg. 194, rules 14.05(c), (d) and (e)

BETWEEN

Roberto Di Michele

Applicant (Appellant/

Respondent by way of
    cross-appeal)

and

Antonio Di Michele, Estate Trustee of the Estate of
    Adalgisa Di Michele, deceased, Antonio Di Michele, Michele Di Michele,
909403
    Ontario Limited, Marsica Investments Limited, Cesidio Ranieri, Gilberto
    Olivieri, Alberto Ramelli
, Capital One Bank and Avrum Slodovnick, and The
    Director of Titles, party pursuant to s. 57(14) of the
Land Titles Act

Respondents (
Respondents/

Appellants by way of
    cross-appeal
)

AND BETWEEN

909403 Ontario Limited, Marsica Investments Ltd.,
    Cesidio Ranieri and Alberto Ramelli

Applicants
    (Respondents/

Appellants by way of
    cross-appeal)

and

Antonio Di Michele also known as Tony Di Michele,
    Michele Di Michele also known as Michael Di Michele, and
Roberto
    Di Michele also known as Robert Di Michele

Respondents (
Appellant/

Respondent by way of
    cross-appeal
)

D. Loucks, for the appellant/respondent by way of
    cross-appeal

Mark Ross, for the respondents/appellants by way of
    cross-appeal

Heard: February 24, 2014

On appeal from the judgment of Justice Beth A. Allen of
    the Superior Court of Justice, dated February 6, 2013, with reasons reported at
    2013 ONSC 870, 86 E.T.R. (3d) 178.

Gillese
    J.A.:

[1]

This appeal raises significant questions about the scope of an estate
    trustees power to mortgage property governed by the
Land Titles Act
,

R.S.O. 1990, c. L.5.

OVERVIEW

[2]

Adalgisa Di Michele died on September 5, 1996, leaving behind her three
    sons: Roberto, Michele and Antonio. Under Mrs. Di Micheles will (the Will),
    Antonio was named the estate trustee.  Because the three brothers have the same
    last names, I will refer to each of them by their first names.

[3]

The Will provided that after all debts had been paid, Mrs. Di Micheles
    estate was to go, in equal shares, to those of her issue alive at the date of
    distribution.

[4]

On March 21, 2002, in his capacity as estate trustee, Antonio registered
    a Transmission by Personal Representative to take title to the family home that
    his mother had owned and lived in until her death.  The home was located at 269
    Angelene Street, Mississauga, Ontario (the Property) and is within the land
    titles system.  By that point, all the estate debts had been paid and it was
    ready for distribution.

[5]

Roberto and Michele never registered on title any interest in, or claim
    to, the Property.

[6]

Starting in 2002, Antonio was embroiled in personal litigation with 909403
    Ontario Limited, Marsica Investments Ltd., Cesidio Ranieri and Alberto Ramelli
    (collectively Marsica or the respondents).

[7]

In June 2008, Antonio put up the Property as security in favour of Marsica
    by means of a mortgage (the Mortgage).

[8]

In 2010, Marsica obtained judgment for $1.5 million against Antonio.

[9]

In 2011, Marsica brought an application in which it sought to have the Property
    sold.

[10]

Roberto (the appellant) lived with his parents on the Property for
    many years prior to their deaths.  He and his wife have continued to live on
    the Property until the present time.  He says that he and his brothers agreed
    that after their mothers death, the Property would be his.

[11]

Roberto brought a counter-application, disputing Marsicas right to sell
    the Property and asserting sole entitlement to it.

[12]

By judgment dated February 6, 2013 (the Judgment), among other things,
    the trial judge:

1.

declared that the Property vested in Antonio, Roberto and         Michele
    on March 21, 2002, in equal one-third shares;

2.

declared the Mortgage to be valid;

3.

ordered the partition and/or sale of the Property in          accordance
    with the interests of the parties entitled to share in     it; and

4.

dismissed Robertos counter-application.

[13]

Roberto appeals.  He asks this court to set aside the Mortgage and that
    part of the Judgment giving relief under the
Partition Act
, R.S.O.
    1990, c. P.4, and order that he replace Antonio as the estate trustee.

[14]

Marsica cross-appeals, arguing that the trial judge erred in finding
    that the Mortgage binds only Antonios one-third interest in the Property.

[15]

For the reasons that follow, I would allow the appeal in part and allow
    the cross-appeal.

BACKGROUND

The Will

[16]

The key provisions in Mrs. Di Micheles Will are set out below.  As will
    become evident, the breadth of the power to postpone sale given to the estate
    trustee is significant to the resolution of this appeal.

I GIVE, DEVISE AND BEQUEATH all of my estate, both real and
    personal,  unto my Trustee upon the following trusts, namely:

a)  To pay all my just debts, funeral expenses and testamentary
    expenses ;

b)   To pay out of the residue of my estate all [duties and
    taxes];

c)
To deliver all the rest and residue of my estate
    then remaining to my issue alive at the date of distribution in equal shares
    per stirpes
.

IN ORDER TO CARRY OUT the provisions of this my Will,
I give
    my Trustee power to sell
, call in
and

convert into
    money
,
all of my estate at such time or times, in such manner and
    upon such terms as my Trustee in his discretion may decide upon, with power and
    discretion to postpone such conversion
of such estate or any part or
    parts thereof,
for such length of time

as he may think best
,
    and I hereby declare that
my Trustee may retain any portion of my estate
    in the form in which it may be at my death  for such length of time as my
    Trustee in his discretion may deem advisable,
without responsibility
    for loss, to the intent that investments or assets so retained shall be deemed
    to be authorized investments for all purposes of this my Will. [Emphasis
    added.]

Antonio Acts as Estate Trustee

[17]

On December 16, 1997, Antonio obtained a Certificate of Appointment of
    Estate Trustee with a Will. The estates only asset was the Property.

[18]

On March 21, 2002, the Property was transferred to Antonio by
    Transmission by Personal Representative.

[19]

The Property had been the Di Michele family home for several decades.
    The parents of the Di Michele brothers lived on the Property until their
    deaths.  The father died in 1987 and the mother in 1996.  The mother gained
    title to the Property on her husbands death.

[20]

At the time of the Property transfer to Antonio, he signed a certificate
    confirming that all the estate debts had been paid.

The 2002 action against Antonio

[21]

In 2002, Marsica commenced an action against Antonio in connection with
    a failed real estate investment scheme (the 2002 action).

[22]

A trial date was scheduled for March 31, 2008.  In the weeks leading up
    to trial, it appeared that the matter would settle on the basis of a payment
    over time secured by a mortgage from Antonio over his cottage property in Bala,
    Ontario.

[23]

Antonio's lawyer, Avrum Slodovnick (Slodovnick) told Marsicas lawyer
    Simon Schonblum (Schonblum) that the settlement was 99% completed and that Antonio
    was just waiting for the blessing of his financial advisor.

[24]

The estimated length of the trial was 10 days.  On the basis that the
    parties were so close to a settlement, counsel agreed to vacate the trial date.

[25]

Shortly after the trial date was vacated, Schonblum searched title for
    the Bala cottage property and found that Antonio had registered a $350,000.00
    mortgage against it on April 4, 2008, thereby exhausting the remaining equity
    in the property.

Antonio seeks adjournment of 2002
    action and grants the Mortgage

[26]

On June 4, 2008, a pre-trial conference was held in relation to the 2002
    action.  At that point, the trial was scheduled to proceed on June 16, 2008.
    Antonio sought an adjournment of the trial because he did not have his
    financial evidence in order.

[27]

Faced with yet another possible delay in the trial and in light of Antonio
    having encumbered the Bala cottage property after having offered it to Marsica as
    security, Marsica was concerned about securing funds for a possible judgment in
    the 2002 action.

[28]

A suggestion was made that Antonio might provide mortgage security in
    exchange for an adjournment so that Antonio could provide further documents and
    obtain a forensic accounting.

[29]

The parties were caucusing separately.  At one point, Slodovnick pulled
    Schonblum out of his room and said that Antonio had given him instructions to
    mortgage the Property as security for any judgment that might follow trial.  In
    exchange, Marsica was to consent to an adjournment to allow Antonio to obtain a
    forensic accounting.

[30]

Slodovnick then showed Schonblum a parcel register for the Property.  On
    the face of the parcel register, under Owners Names, it said Antonio Di
    Michele. Under Capacity were the initials TWW, which stand for Trustee With
    a Will.

[31]

The parties ultimately reached an agreement, under the terms of which: Marsica
    agreed to adjourn the trial; Antonio granted security for any judgment that
    might arise in relation to the 2002 action by means of a blanket mortgage of
    $350,000.00 on the Bala cottage property and the Property; and the parties
    agreed to jointly retain a forensic accountant and split the cost of a review
    of further productions from Antonio of the books and records relating to the
    real estate investment (the Agreement).  The parties were to return for a
    further pre-trial conference in November 2008.

[32]

On June 6, 2008, in his capacity as Antonios lawyer, Slodovnick
    registered the mortgage against the Property.

Antonio's defence struck and
    judgment obtained in 2002 action

[33]

On April 1, 2010, Antonios defence was struck by order of Master Dash.
    On June 22, 2010, Antonios appeal of Master Dash's order was dismissed.

[34]

On October 11, 2010, the trial proceeded as an undefended trial before
    Stinson J.

[35]

By judgment dated October 14, 2010, Stinson J. awarded Marsica damages
    against Antonio in the sum of approximately $1.5 million.

Attempted enforcement of judgment in
    2002 action

[36]

Acting on the judgment obtained in the 2002 action, the respondents obtained
    a writ of seizure and sale.  They filed the writ against the Property with the
    Sheriff in the Peel region.

[37]

The Sheriff posted a notice at the Property that there would be a
    sheriffs sale.  Roberto and his wife were living in the house. Roberto had
    lived at the Property while his parents were alive and continued living there
    after their deaths.  By the time of trial, he had lived on the Property for
    some 50 years.  He claimed that after his mothers death, he and his brothers
    had agreed that the Property would be his.

[38]

Robertos lawyer wrote to counsel and the Sheriff to advise that he
    would be bringing an application to assert his interest in the Property.

The Application and
    Counter-Application

[39]

The respondents brought an application in which they sought, among other
    things, the sale of the Property.  Roberto brought a counter-application in
    which he asserted sole ownership of the Property.  He sought, among other
    things, an order directing Antonio to transfer the Property to him and
    appointing him in Antonios stead as the estate trustee.

[40]

The two matters were converted into trials and heard together.

[41]

At trial, Michele took no position and filed no documents.  Antonio
    appeared on his own behalf.  He denied knowledge of the Will, his appointment
    as the estate trustee, and that the Property had been transmitted to him.

THE TRIAL DECISION

[42]

The trial judge rejected Antonios evidence, stating that he was a most
    unreliable and deceptive witness.  She rejected his claim that someone else applied
    for the Certificate of Estate Trustee with a Will in his name and then
    registered the transmission of the Property to him as estate trustee without
    his knowledge.  She found that Antonio was aware of the Will, of his
    appointment as estate trustee, and that the Property had been registered in his
    name as estate trustee.

[43]

The trial judge set out the parties positions on the many issues that
    had been raised.

[44]

She then analysed and rejected Robertos arguments that the Mortgage was
    fraudulent and invalid because Antonio had given it and he had no interest in
    the Property.  She concluded that while Antonio was not forthright about the
    nature of his interest in the Property  that he held title only as estate
    trustee and that he shared beneficial interest in the Property with his two
    brothers  this alone did not place him within the bounds of fraud as defined in
    s. 1 of the
Land Titles Act
.  Antonio was the registered owner of the
    property, he was not posing as a fictitious person, and there was no forgery.

[45]

The trial judge also rejected Robertos argument that Antonio had no
    property interest in the Property when he gave the Mortgage, though she did not
    conclude that Antonio owned the whole Property.  In her view, the Property automatically
    vested in the estates beneficiaries (the three brothers), three years after
    Mrs. Di Micheles death, pursuant to s. 9 of the
Estates Administration Act
,
    R.S.O. 1990, c. E. 22.  As a result, rather than owning the whole Property as
    estate trustee, Antonio owned only the third of the property to which he was
    beneficially entitled under the Will.  The trial judge took note of s. 10 of
    the
Estates Administration Act
, which provides that nothing in s. 9
    derogates from a power granted to an estate trustee in a will.  She concluded
    that although the Will gave the estate trustee the power to sell the Property and
    to postpone such sale for such length of time as he deems advisable, this did
    not evidence a clear intent to oust s. 9 and delay the vesting of the estate.

[46]

The trial judge concluded that the Mortgage was valid.  However, because
    she found that the brothers beneficial interests in the Property had vested by
    the time that Antonio granted the Mortgage in 2008, she concluded that Antonio
    could only have granted a mortgage against his interest in the Property.

[47]

The trial judge further found that because the 2002 action was against
    Antonio personally, and not in his capacity as the estate trustee, he could
    only give as security that which he owned in his personal capacity.

[48]

Accordingly, the trial judge found the Mortgage to be enforceable only
    against Antonios one-third interest in the Property.

[49]

She then ordered partition or sale of the Property in accordance with
    the interests of the parties entitled to share in it.

THE ISSUES

[50]

The appellant raises a number of issues that can be summarized as
    follows.  Did the motion judge err in:

1.

finding that the Mortgage was valid;

2.

finding that the respondents were entitled to a remedy under      the
Partition
    Act
; and

3.

failing to appoint Roberto as the estate trustee?

[51]

The respondents raise one issue by way of cross-appeal.  Did the motion
    judge err in:

4.

failing to find that the Mortgage bound the entire Property?

ANALYSIS

1. Was the Mortgage valid?

[52]

The appellant makes three arguments going to the validity of the
    Mortgage.  First, he submits that Antonio had no interest in the Property,
    either personally or in his capacity as estate trustee, over which he could
    grant a mortgage.  Second, he argues that the respondents were not
bona fide
purchasers for value without notice.  Third, he says that the lawyers
    involved at the time that the Mortgage was granted were unaware that Antonio
    was not the legal owner of the Property.  Consequently, he contends, the Mortgage
    was a product of Antonios fraudulent representation that he was the owner of
    the Property and, therefore, is a nullity.

[53]

I would not accept any of these submissions.

(a)

Did
    Antonio have an interest in the Property?

[54]

The appellants first submission  that Antonio had no interest in the
    Property  cannot stand in light of the relevant statutory provisions.

[55]

Section 2(1) of the
Estates Administration Act
provides that
    upon a persons death, all of that persons property vests in the estate
    trustee:

All real

and personal

property
    that is vested in a person
without a right in any other person to take
    by survivorship,
on the person's death
, whether testate or
    intestate and despite any testamentary disposition,
devolves to and
    becomes vested in his or her personal representative
from time to time
    as trustee for the persons by law beneficially entitled thereto, and, subject
    to the payment of the person's debts and so far as such property is not
    disposed of by deed, will, contract or other effectual disposition, it shall be
    administered, dealt with and distributed as if it were personal property not so
    disposed of. [Emphasis added.]

[56]

Pursuant to s. 120 of the
Land Titles Act
, on Mrs. Di Micheles
    death, the land registrar was entitled, upon receiving an application from the
    estate trustee, to register the estate trustee as owner in place of the
    deceased:

On the death of the sole registered owner
or of the survivor of several joint registered owners
of freehold land,
    such person shall be registered as owner
in the place of the deceased
    owner or owners
as may
, on the application of any person
    interested in the land,
be appointed by the land registrar, regard being
    had
to the rights of the several persons interested in the land and
in
    particular to the selection of any such person as for the time being appears to
    the land registrar to be entitled according to law to be so appointed
,
    subject to an appeal to the Divisional Court in the prescribed manner by any
    person aggrieved by an order of the land registrar under this section.
    [Emphasis added.]

[57]

Section 63 of the
Land Titles Act

provides that in
    respect of registered dealings with land, the person registered in the place of
    a deceased owner is in the same position as if that person had taken the land
    under a transfer for valuable consideration:

Any person registered in the place of a
    deceased owner
or to whom a patent is issued as executor[,]
    administrator or estate trustee or in any representative capacity shall hold
    the land or charge, in respect of which the person is registered, upon the
    trusts and for the purposes to which the same is applicable by law and subject
    to any unregistered estates, rights, interests or equities subject to which the
    deceased owner held the same, but otherwise in  all  respects,
and  in
    particular as respects any registered dealings with such land or charge, the
    person shall be in the same position as if the person had taken the land or
    charge under a transfer for  valuable consideration.
[Emphasis added.]
[1]

[58]

As a result of these provisions, it is clear that Antonio had the legal
    right to grant the Mortgage.  The Property vested in him, as the estate
    trustee, on his mothers death:
Estates Administration Act
, s. 2(1)
.
He was entitled to be registered as owner of the Property in his mothers
    stead:
Land Titles Act
, s. 120.  He had the Property transferred into
    his name.  He was thereafter the person registered in the place of his mother,
    the deceased owner:
Land Titles Act
, s. 63.  The Mortgage was a
    registered dealing with the Property.  Antonio was in the same position as if
    he had become the registered owner of the Property under a transfer for
    valuable consideration:
Land Titles Act
, s. 63.  A registered owner
    has the right to grant a mortgage over his or her land:
Land Titles Act
,
    s. 93(1).
[2]

[59]

Accordingly, it cannot be said that Antonio had no
    interest in the Property that entitled him to grant the Mortgage.

(b)

Were the respondents
bona fide
purchasers for value without notice?

[60]

With respect to this submission, I begin by noting that the questions of
    value and consideration were not raised before the trial judge.  Issues ought
    not to be raised for the first time on appeal.  In any event, however, the
    contention that the respondents were not
bona fide
purchasers for value
    without notice must fail.

[61]

The first question is whether the respondents were
bona fides

when they took the Mortgage.  In my view, the fact that Antonios lawyer
    offered the mortgage as security eliminates any question of a lack of
bona
    fides
.  Because Antonios lawyer offered the Property as security, the
    respondents were entitled to operate on the assumption that Antonio was acting
    lawfully in granting the Mortgage.  They were not obliged to go behind that
    implicit representation.

[62]

The next question is whether the respondents gave value for the
    Mortgage.  This, too, is easily disposed of.

[63]

The Mortgage was granted as part of the Agreement.  In exchange for the
    Mortgage, the respondents agreed to adjourn the trial and share the cost of the
    forensic accountant that Antonio required.  Even if the adjournment alone does
    not constitute value within the meaning of the term
bona fide

purchaser
    for value without notice, the cost of the forensic accountant borne by the
    respondents clearly does.

[64]

I turn next to the question of notice.

[65]

The appellant points to the fact that the Property register shows
    Antonio as holding the Property in the capacity of TWW, meaning Trustee With
    a Will.  He says that this shows that the respondents had actual notice of the
    Will.  Accordingly, he says, the respondents could not have simply accepted the
    Mortgage as security  they had to first inquire into whether Antonio could
    lawfully mortgage the Property.

[66]

I would reject this argument.  In my view, s. 62(2) of the
Land
    Titles Act
provides a complete answer to it.

[67]

It is correct that when the parties entered into the Agreement, they were
    aware that Antonio held the Property as estate trustee. As the appellant points
    out, the lawyers for both parties had the parcel register in hand at that time
    and the parcel register showed Antonio as owner but in the capacity of TWW (Trustee
    With a Will).

[68]

However, s. 62(2) of the
Land Titles Act
provides that: (1) describing
    the owner of land as a trustee shall be deemed
not
to constitute notice of
    a trust, and (2) the description (of the owner as trustee) does
not
impose a duty on the person dealing with the owner to make inquiry as to the power
    of the owner in respect of the property.  Section 62(2) reads as follows:

Describing the owner of
freehold or
    leasehold
land
or of a charge
as a trustee
, whether
    the beneficiary or object of the trust is or is not mentioned,
shall be
    deemed not to be a notice of a trust
within the meaning of this
    section,
nor shall such description impose upon any person dealing with
    the owner the duty of making any inquiry as to the power of the owner in
    respect of the land or charge
or the money secured by the charge, or
    otherwise,
but, subject to the registration of any caution or inhibition,
    the owner may deal with the land or charge as if such description had not been
    inserted.
[Emphasis added.]

[69]

Thus, Antonios description as TWW (Trustee With a Will) is deemed not
    to be notice of a trust and it imposed no duty on the respondents to make any
    inquiry as to his power as owner to charge the Property.

[70]

Further, s. 62(2) provides that the owner may deal with the land as if
    the description as a trustee had not been inserted.  This is subject to the registration
    of any caution or inhibition.  However, in the present case, no caution or
    inhibition had been registered on the title to the Property.

[71]

Accordingly, I would reject the appellants contention that the
    respondents were not
bona fide
purchasers for value without notice.

(c)

Were the Lawyers operating under a misapprehension that Antonio was the
    owner?

[72]

In light of the evidence about the parcel register, the appellants
    contention that the parties were all labouring under a misapprehension that
    Antonio was the owner of the Property must fail and with it, his argument that
    the Mortgage was obtained by fraud on Antonios part.  In this regard, the
    appellant has confused the notion of a fraudulent transaction with a valid
    transaction that might amount to a breach of trust.  The former may invalidate
    the transaction.  The latter does not.  Rather, it gives rise to an action by
    the beneficiaries against the trustee.

[73]

While Roberto and Michele may have recourse against Antonio for what
    appears to be a breach of his obligations as the estate trustee, that does not
    mean that the Mortgage was granted fraudulently nor does it render the Mortgage
    invalid.

(d)

Conclusion

[74]

For these reasons, I would dismiss this ground of appeal.

2. Were the respondents entitled to a remedy under the
Partition
    Act
?

[75]

The appellant contends that even if the Mortgage were valid, an order
    under the
Partition Act

could not be made because Marsica does
    not have a crystallized right of possession.

[76]

Marsica concedes this point.  However, it contends that the end result of
    enforcement of the Mortgage will be such an order and the relief ordered
    pursuant to the
Partition Act
was an attempt by the trial judge to save
    the parties the cost and trouble of going through the intermediate steps
    relating to foreclosure.

[77]

Marsica is likely correct about the trial judges motivation in ordering
    partition and sale.  However, the law is clear: only persons entitled to the
    immediate possession of an estate in property may bring an action or make an
    application for its partition or sale.

[78]

Section 3(1) of the
Partition Act
reads as follows:

Any person interested in land
in
    Ontario, or the guardian of a minor
entitled to the immediate possession
    of an estate therein
,
may bring an action or make an application
    for the partition
of such land
or for the sale

thereof
under the directions of the court if such sale is considered by the court to be
    more advantageous to the parties interested. [Emphasis added.]

[79]

This court has interpreted s. 3(1) and its predecessors as
    permitting only those entitled to immediate possession of the property to apply
    for partition: see
Morrison v. Morrison
(1917), 39 O.L.R. 163  (S.C.
    (A.D.)), at pp. 168 and 171-72; and
Ferrier v. Civiero
(2001), 147
    O.A.C. 196 (C.A.), at paras. 6 and 8.

[80]

Because the respondents were not entitled to immediate possession of an
    estate in the Property, they were not entitled to a remedy under the
Partition
    Act.

[81]

Accordingly, I would allow this ground of appeal.

3. Should Roberto be appointed Estate Trustee in Antonios stead?

[82]

In his counter-application, Roberto asked to be appointed as the estate
    trustee in Antonios stead.  The trial judge did not address this aspect of his
    counter-application.  Roberto renews his request in this court, saying that
    Antonio and Michele do not claim any interest in the estate and have shown
    that they have no interest in receiving a share of the estate.  Roberto also
    states that Antonio gifted his share of the estate to him.

[83]

Section 37(1) of the
Trustee Act
, R.S.O. 1990, c. T.23, empowers
    the court to remove a personal representative (which is another term for an
    estate trustee)
[3]
and appoint some other proper person.  Section 37(1) reads as follows:

The Superior Court of Justice may remove a personal
    representative upon any ground upon which the court may remove any other
    trustee, and may appoint some other proper person or persons to act in the
    place of the executor or administrator so removed.

[84]

The court will remove an estate trustee only if doing so is clearly
    necessary to ensure the proper management of the trust:
Re Weil
, [1961]
    O.R. 888 (C.A.), at p. 889.  Situations in which removal may be justified
    include where the estate trustee has acted in a way that has endangered the
    trust property or otherwise shown a lack of honesty, proper capacity, or
    reasonable fidelity:
Letterstedt v. Broers
(1884), 9 A.C. 371 (P.C.),
    at pp. 385-86;
Bathgate v. National Hockey League Pension Society
(1994),
16 O.R. (3d) 761 (C.A.), at p. 778.

[85]

Thus, on the record, it appears that there may be good reason to remove Antonio
    as the estate trustee.

[86]

However, in my view, Roberto is not a proper person to serve as his
    replacement.  I say this because Robertos personal interests would seriously
    conflict with the obligations he would undertake as the estate trustee.

[87]

As a general rule, a person will not be appointed as a trustee if that
    persons duties as trustee would conflict with either his or her personal
    interests or duties which that person has undertaken apart from as trustee: see
Re Parsons
, [1940] Ch. 973, at p. 983;
Re Moorhouse
, [1946] 4
    D.L.R. 542 (Ont. H.C.), at p. 544; and
Re Becker
(1986), 57 O.R. (2d)
    495 (Surr. Ct.), at pp. 498-99.

[88]

Two examples illustrate why Robertos appointment as replacement estate
    trustee would run afoul of the general rule precluding those in a conflict
    position from being named estate trustee.

[89]

The first example flows from the estate trustees overriding obligation
    to duly administer the estate.  As the legal owner of the Property, the estate
    trustee will have to comply with the court orders flowing from these
    proceedings, including those relating to the Mortgage.  However, the record
    makes it plain that Roberto claims the Property as his own and that he plans on
    appropriating the Property for himself.  Rather than respecting and
    implementing the court orders in respect of the Property, it seems likely that
    he will resist all actions associated with enforcement of the Mortgage.  In any
    event, his personal interests would be in conflict with his duties as the
    estate trustee in this regard.

[90]

The second example flows from the successor estate trustees obligation
    to take steps to recover, for the estate, any losses caused by the prior estate
    trustees defaults: see
Bennett v. Burgis

(1846), 5 Hare 295
    (Ch.), at p. 297.  This would require Roberto, if he were appointed the
    successor estate trustee, to consider taking action against Antonio for any losses
    that Antonio may have caused the estate in his capacity as the initial estate
    trustee.  But, it will be recalled, Roberto claims that Antonio made a gift to
    him of his interest in the estate.  So, if Roberto
qua
estate trustee
    found that he ought to pursue Antonio, would he have to consider attacking the
    gift?  It is self-evident that in such a situation, Robertos obligation if he were
    the estate trustee would conflict with his personal interests.

[91]

I would add that the foregoing examples stand apart from the
    respondents contention that the alleged gift from Antonio to Roberto of his
    interest in the estate was for the purpose of defeating, hindering or avoiding
    a creditor.  By virtue of accepting the gift of Antonios interest, Roberto
    would be complicit in such an act.  Thus, this allegation also raises serious
    questions about whether Roberto is a proper person to serve as estate trustee.

[92]

Accordingly, I would dismiss this ground of appeal.

THE CROSS-APPEAL

4. Did the Mortgage bind the entire Property?

[93]

The trial judge concluded that although the Mortgage was valid, it was
    binding only on the one-third share that she found Antonio was entitled to
    receive as a beneficiary under the Will.  In reaching this conclusion, the
    trial judge relied on s. 9 of the
Estates Administration Act
.

[94]

Section 9 of the
Estates Administration Act
reads as follows:

Real property not
disposed of, conveyed
    to, divided or
distributed among the persons beneficially entitled
    thereto
under section 17 by the personal representative
within
    three years after the death of the deceased

is

thenceforth
    vested in the persons beneficially entitled thereto under the will
unless such personal representative, if any, has signed and registered, in the
    proper land registry office, a caution in Form 1 ... [Emphasis added.]

[95]

The trial judge saw that the Will gave Antonio, as estate trustee, an
    unqualified power to postpone sale of the Property.  Nonetheless, in her view, there
    is no clear intention in the Will that  Anthony have discretion beyond three
    years to distribute the estate.

[96]

As a result, pursuant to s. 9 of the
Estates Administration Act
,
    the trial judge found that the Property vested in the beneficiaries three years
    after Mrs. Di Micheles death, in the same manner as if the estate trustee had
    conveyed it to them.  On this view, the vesting occurred before the Mortgage
    was granted.  Therefore, the Mortgage could attach only to Antonios one-third
    beneficial interest in the Property.

[97]

With respect, I do not agree.  In my view, the Mortgage is binding on
    the whole of the Property.  I reach this conclusion for three reasons.

[98]

First, s. 9 of the
Estates Administration Act
does not apply in
    the circumstances of this case.  Section 9 (and its predecessors) was not enacted
    to limit the powers given to an estate trustee under a will.  Rather, it was intended
    to give estate trustees additional powers, but only to the extent that the additional
    powers do not conflict with the provisions of the will.  The intention of the
    deceased, as expressed in his or her will, is always paramount:
Re Leblanc
(1978), 18 O.R. (2d) 507 (C.A.), at pp. 513-15.

[99]

This can be seen from s. 10 of the
Estates Administration Act
,
    which provides that nothing in s. 9 derogates from any right possessed by a
    trustee under the will.  Section 10 reads as follows:

Nothing
    in section 9 derogates from any right possessed by an executor or administrator
    with the will annexed under a will or under the Trustee Act or from any right
    possessed by a trustee under a will.

[100]

The
    paramountcy of the testators intention is confirmed in the jurisprudence.  Where
    a will gives the estate trustee a power to sell property at such times and in
    such manner as the estate trustee sees fit, s. 9 of the
Estates
    Administration Act

will not limit the scope of that power by
    requiring that the property vest after a specific period of time:
Re
    Proudfoot Estate
(1994), 3 E.T.R. (2d) 283 (Ont. Gen. Div.), at paras. 8
    and 11-12, vard on other grounds (1997), 19 E.T.R. (2d) 150 (Ont. C.A.).  See
    also
Re Leblanc
, at p. 515.

[101]

It
    will be recalled that the Will gave Antonio, as estate trustee, the power to sell
    the Property at such time or times, in such manner and upon such terms as my
    Trustee in his discretion may decide upon.  It went on to expressly provide
    that the estate trustee could postpone sale:

for such length of time as he may think best, and I hereby
    declare that my Trustee may retain any portion of my estate in the form in
    which it may be at my death  for such length of time as my Trustee in his
    discretion may deem advisable...

[102]

On
    a plain reading of these provisions in the Will, the estate trustee was given
    the power to postpone sale of the Property for whatever length of time he
    deemed advisable.  Thus, in my view, the trial judge erred in finding that the
    Will contained no clear intention that Antonio had the discretion to delay
    selling the Property beyond the three year limit in s. 9 of the
Estates
    Administration Act
.  Consequently, s. 9 did not apply and the Property did
    not vest in the beneficiaries.

[103]

Second,
    the beneficiaries entitlement under the Will did not amount to a property interest
    in the Property.  The Will does not give the beneficiaries a specific bequest
    of the Property.  Rather, it gives them a contingent interest in the residue of
    the estate.  In this regard it will be recalled that the Will provided that the
    residue of the estate was to go to Mrs. Di Micheles issue alive at the date
    of distribution. Accordingly, to become entitled, a beneficiary had to be
    alive on the date of distribution.  Until distribution, the beneficiaries had
    only a contingent beneficial interest in the residue of the estate, as well as
    the personal right to compel the estate trustee to duly administer the estate.

[104]

A
    contingent beneficial interest in an estate does not give rise to a property
    interest in any specific asset of the estate, prior to or absent an
    appropriation of such asset to the beneficiary by the trustee:
Spencer v.
    Riesberry
, 2012 ONCA 418, 114 O.R. (3d) 575, at para. 37.

[105]

The
    estate had not been distributed at the time that the Mortgage was granted.
    Therefore, the beneficiaries contingent interests in the residue had not
    vested.  Hence, Antonio did not have a one-third interest in the Property at the
    time of the Mortgage.

[106]

Third,
    pursuant to s. 93(3) of the
Land Titles Act
, the Mortgage was
    registered free from any unregistered interest of the beneficiaries.  Section
    93(3) reads as follows:

The charge, when registered, confers upon the chargee
    a charge upon the interest of the chargor as appearing in the register subject
    to the encumbrances and qualifications to which the chargors interest is
    subject, but free from any unregistered interest in the land.

[107]

Under
    Ontarios land titles system, the rights of a
bona fide
purchaser (which
    includes a mortgagee) for value who has registered its interest in the property
    trump any prior unregistered interests in the property:
719083 Ontario
    Limited v. 2174112 Ontario Inc.
, 2013 ONCA 11,
28
    R.P.R. (5th) 1,
at para. 12;
MacIsaac v. Salo
, 2013 ONCA 98,
    114 O.R. (3d) 226, at para. 39.

[108]

In
    the present case, as I have already explained, the respondents were
bona
    fide
purchasers for value without notice.  They registered their interest
    (the Mortgage) in the Property.  Their interest would trump those with a prior
    unregistered interest in it.  Therefore, even if the beneficiaries had an
    interest in the Property that pre-existed the granting of the Mortgage, that
    interest was unregistered and therefore was trumped by the registered Mortgage.

[109]

Accordingly,
    the Mortgage binds the entire Property.

[110]

Thus,
    I would allow the cross-appeal.

DISPOSITION

[111]

Accordingly,
    I would allow the appeal in part and delete the references in the Judgment to
    relief under the
Partition Act
.  I would allow the cross-appeal and,
    therefore, delete para. 2 of the Judgment.

[112]

The
    appellant succeeded only in respect of the second issue, which the respondents
    had conceded and which occupied a very small part of the appeal.  In all other
    respects, the respondents were successful.  Accordingly, I would order costs in
    favour of the respondents, fixed at $13,500, all inclusive.

Released: April 3, 2014 (J.C.M.)

E.E. Gillese
    J.A.

I agree. J.C. MacPherson J.A.

I agree. E.A. Cronk J.A.

[1]
I have quoted this provision of the
Land Titles Act
as it exists today,
    rather than as it existed at the time of Mrs. Di Micheles death in 1996.  In
    1998, the Ontario legislature amended this provision to include a reference to
    estate trustees (the previous versions of s. 63 had referred only to executors and
    administrators, which are categories of estate trustees): S.O. 1998,
    c. 18, Sched. E, s. 126.  This amendment has no bearing on the issues
    raised in this appeal.

[2]
Section 93(1) reads as follows: A registered owner may in the prescribed
    manner charge the land with the payment at an appointed time of any principal
    sum of money either with or without interest or as security for any other
    purpose and with or without a power of sale.

[3]
A personal representative and an estate trustee are both defined as an
    executor, administrator, or administrator with the will annexed.  Under s. 1 of
    the
Trustee Act
personal representative is defined as an executor, an
    administrator, and an administrator with the will annexed) and under rule
    74.01 of the
Rules of Civil Procedure
, R.R.O. 1990, Reg. 194, estate
    trustee is defined as an executor, administrator or administrator with the
    will annexed.


COURT OF APPEAL FOR ONTARIO

CITATION: Dickie v. Minett, 2014 ONCA 265

DATE: 20140403

DOCKET: C56191

Rosenberg, Gillese and Strathy JJ.A.

BETWEEN

Robert Dickie and Karen Dickie

Plaintiffs (Appellants)

and

Charles Minett

Defendant (Respondent)

Patrick G. Morris, for the appellants

Andrew A. Lundy, for the respondent

Heard: March 31, 2014

On appeal from the judgment of Justice Thomas A. Bielby
    of the Superior Court of Justice, dated September 14, 2012, with reasons
    reported at 2012 ONSC 4474.

ENDORSEMENT

[1]

The appellants appeal from the judgment of Bielby J. dated September 14,
    2012, dismissing their action in negligence. They submit that the trial judge
    erred in failing to find that the respondent was negligent in the extraction of
    Mr. Dickies wisdom tooth, referred to as tooth number 48.

[2]

Their principal argument is that an inference of negligence arises from
    the fracture of Mr. Dickies jaw during the course of the surgery. They say
    this calls for an explanation from the respondent, and that the respondents
    reliance on his clinical notes and his usual practice was insufficient to
    demonstrate the exercise of reasonable care.

[3]

The appellants submission amounts to
res ipsa loquitur
without
    using that term. That doctrine was put to rest in
Fontaine v. British
    Columbia (Official Administrator)
, [1998] 1 S.C.R. 424. While there remain
    cases in which circumstantial evidence can raise an inference of negligence which
    calls for an explanation from the defendant, the appellants have not persuaded
    us that the trial judge erred in concluding that the evidence did not reach
    that threshold in this case.

[4]

The trial judge declined to draw an adverse inference from the
    respondents lack of independent recollection in relation to the extraction of
    tooth 48, which occurred some six years prior to the trial. He was entitled to
    accept the respondents explanation for his lack of recollection and to rely on
    his evidence of how he performed the extraction, based on his post-operative
    notes and his invariable practice.

[5]

There was expert evidence, accepted by the trial judge, that a patients
    jaw could break during surgery in spite of the use of reasonable care. It was a
    known, albeit very rare, complication of such surgery. Here, there were a
    number of acknowledged risk factors, including the loss of almost 80 percent of
    the jaw bone structure in the area of the tooth due to severe periodontal
    disease. The tooth was deeply impacted and fused to the bone.

[6]

The trial judge accepted the evidence of the respondents expert that he
    met the standard of care and rejected the appellants expert evidence. He gave detailed
    and cogent reasons for doing so, citing the failure of the appellants expert
    to adequately consider the risk factors involved in this particular extraction.
    In the absence of palpable and overriding error, there is no basis on which to
    interfere with his findings based on his assessment of the evidence.

[7]

The appeal is therefore dismissed, with costs to the respondent in the
    amount of $15,000, inclusive of all applicable taxes and disbursements, as
    agreed by the parties.

M. Rosenberg J.A.

E.E.
    Gillese J.A.

G.R.
    Strathy J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: GFL Environmental Inc. v. Sittler Excavating
    Limited,

2014 ONCA 283

DATE: 20140411

DOCKET: C57872

Weiler, Lauwers and Pardu JJ.A.

BETWEEN

GFL Environmental Inc.

Plaintiff (Respondent)

and

Sittler Excavating Limited and 3239501 Canada
    Limited

Defendants (Appellants)

Edward L. DAgostino, for the appellants

Christopher J. Cosgriffe and Ryan R. Watkins, for the
    respondent

Heard: April 10, 2014

On appeal from the judgment of Justice David G. Stinson
    of the Superior Court of Justice, dated October 8, 2013.

APPEAL BOOK ENDORSEMENT

[1]

The appellant essentially reargued the motion. We find no error in the
    motion judges reasons. In fact we agree with him.

[2]

The appeal is dismissed. Costs fixed at $6,774.35 all inclusive in favour
    of the respondent.


COURT OF APPEAL FOR ONTARIO

CITATION: Gajewski (Re) 2014 ONCA 332

DATE: 20140429

DOCKET: C57630

Weiler, Feldman and Gillese JJ.A.

IN THE MATTER OF:  BARTOSZ GAJEWSKI

AN APPEAL UNDER PART XX.1 OF THE
CODE

Bartosz Gajewski, appellant appearing in person

Jill R. Presser and Andrew Menchynski,
amicus curiae

Joanne Stuart, for
    the Crown

Michele Warner, for
    the Person in Charge of the Centre for Addiction and Mental Health

Heard: April 24, 2014

On appeal against the disposition of the Ontario Review
    Board dated, August 20, 2013.

ENDORSEMENT

[1]

The appellant was found NCR after a trial on the charges of forcible
    confinement and assault.  He met the complainant in 2002 while working in her
    home and became infatuated with her.  He was under the delusion that she was in
    love with him.  After one incident in which the charges of criminal harassment
    were withdrawn, he had no contact with the complainant until 2009 when he attempted
    to abduct her, purporting to be effecting a citizens arrest.  The complainant was
    physically injured in the attempt and remains afraid of him to this day.

[2]

After his initial review, on the understanding that the appellant had
    some insight into his illness and was open to treatment, he was ordered
    detained on the General Forensic Unit at CAMH.

[3]

Unfortunately, problems arose.  The appellant made it clear that he had
    no intention of taking treatment and did not believe his diagnosis.  His
    delusions in respect to the complainant remained.  Concerns about his use of
    the computer arose.  Intimidating behaviour towards hospital staff was
    reported.  His paranoid beliefs were more entrenched and had extended to
    hospital staff, including one of his treating psychiatrists.

[4]

At an early review in February 2012, the hospital report indicated that
    the appellant had been seen by eight different psychiatrists, all of whom were
    of the view that he is psychotic and in need of antipsychotic medication.  He
    manifested symptoms of active psychosis, including paranoia, grandiosity, and
    religious delusions.  The Board ordered detention in a Secure Forensic Unit.

[5]

At his review in 2013, the Board found that the appellant remains a
    significant threat to the safety of the public and ordered that he be detained
    in the Secure Forensic Unit of CAMH, with privileges up to and including accompanied
    hospital and grounds privileges.

[6]

The Boards finding was based largely on the evidence of Dr. Darby and
    the Hospital Report, which shows that the appellant continues to suffer from
    Delusional Disorder, persecutory type, which remains mostly untreated.   Dr.
    Darby testified that an individual suffering from a delusional disorder of this
    nature is likely to have fixed delusions until treated and that the appellants
    complete disengagement from his treatment team made management of his risk
    impossible.

THE ISSUES

[7]

The appellant, through
amicus
, raises three issues on appeal.
    Did the Board:

1.

Act unreasonably or err in law by placing the appellant in the Secure
    Forensic Unit instead of the General Forensic Unit?

2.

Give insufficient reasons for refusing to place the appellant in the
    LGUD Hybrid Unit or err in failing to make this placement decision?

3.

Err by limiting his right to cross-examine his treating psychiatrist?

ANALYSIS

Issue 1: Placement in the Secure Forensic Unit

[8]

In our view, the Boards finding that the hospital was unable to manage
    the appellants risk unless he was detained in the Secure Forensic Unit, with
    only accompanied passes in the hospital and on the grounds, is neither
    unreasonable nor an error in law.  On the Secure Forensic Unit, there is a
    higher staff ratio which can lead to greater vigilance.  (We note also the
    Boards finding that it may also lead to some privileges of benefit to the
    appellant.)

[9]

The main reasons for the appellants original transfer to the Secure
    Forensic Unit from the General Forensic Unit remain.  These include his lack of
    insight into his mental illness, his refusal to engage with his treatment team,
    and the resulting risk he poses to the complainant.  That risk has increased
    and expanded to include others, including hospital staff.  The evidence showed
    that the appellants disengagement from treatment made the management of his
    risk impossible.

Issue 2:       Refusal to place the appellant in the LGUD
    Hybrid Unit

[10]

The
    appellant complains that the Board reasons do not address his possible
    placement in this unit, which would have been less onerous and less restrictive
    than placing him in a secure unit.

[11]

Reading
    the reasons as a whole, it is clear that the Board did not address this matter
    because it found that he should be detained in a Secure Unit.  Having made that
    determination, it was not necessary to go further and address issues relating
    to the LGUD, which is a type of general forensic unit.

Issue 3:       Limits on Cross-examination

[12]

The
    appellant submits that the Board unfairly restricted his counsels right to
    cross-examine Dr. Darby on the reasonableness of his refusal to take medication
    and the feasibility of his treatment plan.

[13]

In
    the circumstances of this case, we see no unfairness in the Boards having
    limited the right of cross-examination.    At the point where the Chair of the
    Board intervened, counsel had elicited the evidence she needed to make her
    points about the diagnosis, proposed treatment, side-effects of anti-psychotic
    medication, and that there is no guarantee that the medication will make the
    delusions disappear.

[14]

Moreover,
    the Chair asked counsel to explain the relevance of further cross-examination
    on the matters in question.  That relevance was not made clear at the hearing
    and we do not see it as relevant.  There was no disagreement that the appellant
    posed a significant threat to the safety of the public.  Further, the
    appellants position was clear:  he did not acknowledge that he had a mental
    illness and he refused any form of treatment.  The issue was whether placement
    should be on the secure unit or the general unit.

DISPOSITION

[15]

Accordingly,
    the appeal is dismissed.

K.M.
    Weiler J.A.

K.
    Feldman J.A.

E.E. Gillese J.A.