COURT OF APPEAL FOR ONTARIO

CITATION:  R. v. Thompson, 2014 ONCA 43

DATE: 20140120

DOCKET: C55783

Cronk, Watt and van Rensburg JJ.A.

BETWEEN

Her Majesty the Queen

Appellant

and

Dave Thompson

Respondent

Stephen Dawson, for the appellant

Carlos F. Rippell, for the respondent

Heard:  December 3, 2013

On appeal from a stay of proceedings entered on July 5,
    2012 by Justice Beth A. Allen of the Superior Court of Justice, sitting without
    a jury, with reasons reported at 2012 ONSC 3979, 288 C.C.C. (3d) 315.

Watt J.A.:

[1]

Issue estoppel is preclusive in its effect.  In a criminal case, it
    precludes the Crown from introducing evidence in later proceedings inconsistent
    with findings made in an accuseds favour in earlier proceedings.

[2]

In most criminal cases where issue estoppel is advanced by an accused,
    both the earlier and later proceedings are trials.  But not always.  Not here,
    at least.

[3]

In this case, the first proceeding was a revocation application under s.
    742.6 of the
Criminal Code
.  The Crown alleged that Dave Thompson (the
    respondent) breached a term of his conditional sentence order (CSO)  to keep
    the peace and be of good behaviour  after police officers found crack and
    powder cocaine in his bedroom.  The Crowns application failed because its evidence
    did not establish that the respondent was in possession of the substances seized.

[4]

The second proceeding was the prosecution of the respondent for
    possession of the same cocaine for the purposes of trafficking, and for
    possession of the proceeds of crime as a result of some money found during the
    same search.  The prosecution failed too.  The trial judge thought that issue
    estoppel precluded the Crown from introducing evidence that the respondent was
    in possession of cocaine for the purpose of trafficking, because that fact
    (possession of the cocaine) had been decided in the respondents favour on the
    revocation hearing.  The trial judge entered a stay of proceedings on the
    possession for the purpose count.

[5]

The Crown appeals.  As I will explain, I am satisfied that the trial
    judge erred in holding that issue estoppel precluded the Crown from introducing
    the evidence it sought to elicit to prove the count of possession of cocaine
    for the purpose of trafficking.  I would set aside the stay entered on that
    count and order a new trial.

THE BACKGROUND FACTS

[6]

A brief elaboration on what has already been said is sufficient
    background to the discussion that follows.

The Conditional Sentence
    Order

[7]

On April 7, 2010, the respondent pleaded guilty to and was convicted of
    trafficking in a controlled substance.  He was sentenced to a term of
    imprisonment of 15 months to be served in the community.  A compulsory
    condition of the CSO under s. 742.3(1)(a) of the
Criminal Code
required the respondent to keep the peace and be of good behaviour.

The Search and Seizure

[8]

About four months after the CSO had been imposed, police executed a
    warrant at the respondents house under the
Controlled Drugs and Substances
    Act
, S.C. 1996, c. 19
.
    The respondent was home when the warrant was executed.  In what was alleged to
    be the respondents bedroom, police found crack and powder cocaine and about
    $3,000 in Canadian currency alleged to be the proceeds of crime.

The Charges

[9]

As a result of the drugs and money found during the search, the
    respondent was charged with possession of cocaine for the purpose of
    trafficking and possession of the proceeds of crime.

The Revocation Hearing

[10]

About
    two and one-half months after the respondents arrest on the new charges, the
    Crown proceeded with a revocation hearing under s. 742.6 of the
Criminal
    Code
.  The Crown alleged that the respondent had breached the condition
    that he keep the peace and be of good behaviour by possessing powder and crack
    cocaine found during the search of his bedroom.

[11]

At
    the revocation hearing, Crown counsel (not Mr. Dawson) called no witnesses.
    Relying on s. 742.6(4) of the
Criminal Code
, the Crown filed a written
    report of the respondents CSO supervisor and a signed statement from the
    investigating officer describing what happened on the search of the
    respondents home.  No certificate of analysis of the substances found during
    the search was filed.

[12]

During
    submissions at the revocation hearing, it became clear that the investigating
    officer who had signed the witness statement was present during the execution
    of the warrant, but did not himself make or otherwise participate in the seizures.
    The officers description of both the location of the seizures and the nature
    of the substances found was simply a repetition of what he had been told by
    others.

[13]

Counsel
    for the respondent at the hearing took the position that the Crown had failed to
    adduce any admissible evidence that the respondent was in possession of cocaine
    when the police searched his home.  The statement filed on the hearing was
    inadmissible to prove where the substance was located when it was seized,
    because it was hearsay.  Thus, the Crown failed to establish the breach
    alleged.

[14]

Counsel
    for the Crown at the revocation hearing, although initially asserting that the
    evidence was sufficient to establish a breach, ultimately   acknowledged the
    hearsay nature of the officers statement and agreed that there was no
    admissible evidence to prove the material fact that cocaine was found in the
    accuseds possession.  He invited the judge to dismiss the application.

The Decision at the
    Revocation Hearing

[15]

The
    judge presiding at the revocation hearing thanked Crown counsel for
    acknowledging the hearsay nature of the officers statement and continued:

I do think its in breach of the requirement as outlined in
R.
    v. McIvor
from the Supreme Court of Canada and I simply cant rely on hearsay
    evidence for the material fact of Mr. Thompson being in possession of this drug
    or otherwise.  So I thank you for that.  So the proceeding will be marked
    dismissed.

[16]

The
    judge concluded her brief reasons in this way:

The federal Crown requested that the matter be dismissed after
    submissions and it was granted.  Sir, there is no need to apologize.  Quite
    frankly, you should be commended for the position youd taken after the
    submissions.

The Trial Proceedings

[17]

About
    20 months after the revocation hearing had concluded, the respondent appeared
    for trial on the charges arising out of the drugs and money found on the
    execution of the search warrant at his home.

[18]

At
    the outset of the trial proceedings, counsel for the respondent (not Mr.
    Rippell) sought a ruling that issue estoppel precluded re-litigation of the
    issue whether the respondent was in possession of controlled substances.  Crown
    counsel resisted the application.

The Decision of the
    Trial Judge

[19]

The
    trial judge concluded that the respondent had established the prerequisites for
    the operation of the doctrine of issue estoppel.  She explained her conclusion in
    these terms:

I am of the view that Mr. Thompson has met his burden to show
    that the requirements for the application on issue estoppel have been met.
    There is no question about satisfaction of the first requirement  that the
    same issue of possession that was before the court in the conditional sentence
    hearing is now before the court to be tried.  The third element of common
    parties at both proceedings is also clearly satisfied.  In the Crowns view, it
    is not clear that Kelly, J. finally disposed of the specific issue of
    possession.

I disagree.  I find that Kelly, J. made a conclusive finding on
    a specific question of fact.  She made a determination on a material fact in
    the accuseds favour in concluding the Crown failed through the evidence
    presented in the signed witness statements to meet its burden to prove that Mr.
    Thompson was in possession of the drugs.  The parties were left with no uncertainty
    about that at the end of the proceeding.

This is the type of circumstance in the criminal context that
    is contemplated by the doctrine of issue estoppel.  Proceeding to trial would
    leave open the possibility for inconsistent findings on the issue of
    possession.  Mr. Thompson has a decision in his favour on possession.  It would
    be a patent injustice to him and not in the interests of the fair
    administration of justice for him to be faced once again with defending himself
    against the same allegation.

[20]

The
    trial judge entered a stay of proceedings on the count of possession of cocaine
    for the purpose of trafficking.  Counsel for the Crown (not Mr. Dawson)
    directed entry of a stay of proceedings on the proceeds count.

THE GROUNDS OF APPEAL

[21]

Crown
    counsel advances three grounds of appeal.  He submits that the trial judge:

i.

erred in applying issue estoppel when no issue had been resolved by the
    judge presiding at the revocation hearing;

ii.

erred in applying issue estoppel to an interlocutory ruling, thus exceeding
    the narrow scope of the doctrine; and

iii.

erred in failing to consider her residual discretion to refuse to enter
    a stay of proceedings where the conditions precedent to the operation of the
    doctrine of issue estoppel had been met.

Ground #1:  The Lack of a Decision on an Issue

[22]

This
    ground of appeal focuses on the requirement that there be a prior judicial
decision
or
finding
which is said to create the estoppel in a subsequent
    proceeding.

The Arguments on Appeal

[23]

For
    the appellant, Mr. Dawson emphasizes that the doctrine of issue estoppel
    imposes a stringent test for establishing the identity of issues between the
    estoppel-creating and the estoppel-applying proceedings.  In the
    estoppel-creating proceedings, an issue must be expressly resolved, or must
    necessarily be the only rational explanation for the verdict.

[24]

Mr.
    Dawson says that no issue was resolved at the revocation hearing.  No
    admissible evidence was adduced to prove the alleged breach.  Crown counsel
    invited the judge to dismiss the application.  That dismissal was not the
    equivalent of an acquittal although the trial judge treated it as if she were
    applying the special plea of
autrefois acquit
.  No decision.  No issue
    estoppel.

[25]

For
    the respondent, Mr. Rippell contends that the appellant has mischaracterized
    what occurred at the revocation hearing.  Evidence was adduced at the hearing
    in documentary form as s. 742.6(5) expressly permits.  This evidence has the
    same probative force as
viva voce
testimony to the same effect.  The
    judge at the revocation hearing made a conclusive finding on a specific
    contested factual issue:  possession of cocaine.  That finding satisfied the
    first prerequisite to engage the doctrine of issue estoppel.

The Governing Principles

[26]

Before
    examining the prerequisites to the application of the doctrine of issue
    estoppel, it is helpful to recall briefly the nature of revocation hearings
    under s. 742.6 of the
Criminal Code
.

Revocation Hearings under s. 742.6

[27]

A
    CSO revocation hearing is initiated by the arrest of the offender for an
    alleged breach of the order, or by the issuance of some other form of process
    to compel the offenders appearance before a court of competent jurisdiction.  The
    hearing is to be conducted within 30 days of the offenders arrest or compelled
    appearance, or as soon afterwards as is practicable in the circumstances.

[28]

The
    issue on the hearing is framed by the dispositive authority in s. 742.6(9):  Did
    the offender breach a condition of the CSO without a reasonable excuse?  The
    onus of proving the breach is on the Crown.  The onus of establishing a
    reasonable excuse is on the offender.  The standard of proof for both is proof
    on a balance of probabilities.

[29]

Breach
    of a condition of a CSO is
not
an offence.  Thus, a person alleged to
    have breached a condition of a CSO is not charged with an offence for the
    purposes of s. 11 of the
Charter
.  In some respects, CSO breach
    proceedings are like prosecutions for breach of probation, coupled with a
    revocation hearing to lift the suspension of a sentence:
R. v. McIvor
,
    2008 SCC 11, [2008] 1 S.C.R. 285, at para. 12.  The analogy is imperfect,
    however, because breach of probation
is
an offence, triable by indictment
    or summary conviction, and must be proven beyond a reasonable doubt.  A closer
    analogy might be bail revocation proceedings under s. 524(3) of the
Criminal
    Code
.
[1]

[30]

Parliament
    intended that allegations of a breach of the conditions in a CSO would be heard
    and determined in a simple, expedited manner, unencumbered by the formalities
    associated with criminal trial proceedings:
McIvor
, at para. 18.  For
    example, s. 742.6(4) permits documentary proof, rather than
viva voce
testimony, of the alleged breach.  Leave is required under s. 742.6(8) before
    the supervisor or any witness whose signed statement is included in the
    supervisors report may be cross-examined.

[31]

Despite
    Parliaments intention that alleged breaches of the conditions of a CSO be heard
    and determined in an expedited, less formal way, s. 742.6 does not countenance
    a complete departure from the ordinary rules of evidence.  The documentary
    evidence submitted  the CSO supervisors report and signed statements of
    witnesses  must not extend beyond what their respective authors could say if
    called to give
viva voce
testimony at the hearing:
McIvor
,
    at para. 24.  It would seem logically to follow that the offender is entitled
    to challenge any part of the Crowns documentary evidence that fails to comply
    with the rules of evidence  like the hearsay rule  and the judge presiding on
    the revocation hearing would be required to rule on the challenge.

[32]

Section
    742.6(9) defines the dispositive authority of the presiding judge where the
    Crown has proven a breach of a condition of the CSO and the offender has failed
    to establish a reasonable excuse for the breach.  Where the Crown fails in its
    proof, or the offender establishes a reasonable excuse, the allegation is
    dismissed.  Section 742.6(15) also anticipates that the allegation may be
    withdrawn.

The Decision Requirement in Issue Estoppel

[33]

The
    doctrine of issue estoppel is concerned with particular issues common to two
    different pieces of litigation involving the same parties:
R. v.
    Mahalingan
, 2008 SCC 63, [2008] 3 S.C.R. 316, at para. 17.  When applied
    to a trial, the doctrine focuses on particular determinations of the issues
    supporting the verdict, not on the ultimate verdict itself, which is the
    business of double jeopardy:
Mahalingan
, at para. 17.

[34]

Where
    the doctrine of issue estoppel applies, it prevents the Crown from
    re-litigating an issue that has been decided in the accuseds favour with
    finality in a prior criminal proceeding:
Mahalingan
, at para. 31.

[35]

The
    first requirement for a claim of issue estoppel is that an issue has been
    decided in a prior proceeding:
Mahalingan
, at paras. 49 and 52.  The
    onus of proving this threshold requirement falls upon the accused who seeks to
    invoke the doctrine:
Mahalingan
, at para. 52.

[36]

To
    satisfy this onus, an accused must show that the question was or must
    necessarily have been resolved on the merits in the accuseds favour in the
    earlier proceeding:
Mahalingan
, at para. 52.  It is not enough to
    show that the evidence was adduced in an earlier proceeding and an acquittal
    entered:
Mahalingan
, at para. 52.  It must be a necessary inference,
    either from the judges findings or from the fact of the result, that the issue
    was resolved in the accuseds favour:
Mahalingan
, at para. 52.

The Principles Applied

[37]

I
    would not give effect to this ground of appeal.

[38]

The
    ultimate issue before the judge presiding at the revocation hearing was whether
    the Crown had proven, on a balance of probabilities, that the respondent had breached
    the keep the peace and be of good behaviour condition of the CSO.  The conduct
    alleged to constitute the breach consisted of the respondents possession of the
    crack and powder cocaine that was discovered on the execution of the search
    warrant at his home.

[39]

The
    presiding judge found that the Crown had failed to provide admissible evidence
    proving that the respondent had possessed cocaine. She dismissed the allegation
    at the request of the Crown.  The inevitable result of this decision is that the
    issue of possession of cocaine was decided in the respondents favour at the
    revocation proceedings.  The first requirement of issue estoppel has been met.  The
    application of the doctrine cannot be defeated on this basis.

Ground #2:  The Finality Requirement

[40]

The
    second ground of appeal focuses on the nature of the proceedings in which the estoppel-creating
    decision was made.  For ease of reference, I will excerpt once again the
    relevant part of the trial judges reasons giving effect to the doctrine.

The Reasons of the Trial
    Judge

[41]

The
    trial judge explained why she applied the doctrine of issue estoppel in these
    terms:

I am of the view that Mr. Thompson has met his burden to show
    that the requirements for the application on [
sic
] issue estoppel have
    been met.  There is no question about satisfaction of the first requirement
    that the same issue of possession that was before the court in the conditional
    sentence hearing is now before the court to be tried.  The third element of common
    parties at both proceedings is also clearly satisfied.  In the Crowns view, it
    is not clear that Kelly, J. finally disposed of the specific issue of
    possession.

I disagree.  I find that Kelly, J. made a conclusive finding on
    a specific question of fact.  She made a determination on a material fact in
    the accuseds favour in concluding the Crown failed through the evidence
    presented in the signed witness statements to meet its burden to prove that Mr.
    Thompson was in possession of the drugs.  The parties were left with no
    uncertainty about that at the end of the proceeding.

This is the type of circumstance in the criminal context that
    is contemplated by the doctrine of issue estoppel.  Proceeding to trial would
    leave open the possibility for inconsistent findings on the issue of
    possession.  Mr. Thompson has a decision in his favour on possession.  It would
    be a patent injustice to him and not in the interests of the fair
    administration of justice for him to be faced once again with defending himself
    against the same allegation.

The Arguments on Appeal

[42]

For
    the appellant, Mr. Dawson says that findings made at CSO revocation hearings
    cannot found a claim of issue estoppel in later trial proceedings.  He submits
    that despite the references to both proceedings and trial in
Mahalingan
,
    the decision only makes sense if the prior proceeding is a trial.

[43]

Mr.
    Dawson emphasizes that issue estoppel is applied narrowly in the criminal law.
    It is not invoked simply because a prior decision or ruling was made on an issue
    common to two proceedings.  The estoppel-creating decision must be final.
    Findings on particular issues at trial are final.  Not so, rulings made at
    preliminary inquiries or in sentencing hearings.  Rejection of this claim of
    issue estoppel is consistent with the goals served by and the principles that
    underlie the doctrine.

[44]

For
    the respondent, Mr. Rippell disputes the appellants submission that issue
    estoppel is limited to findings made at trial.  The doctrine does not apply to
    interlocutory rulings made at a preliminary inquiry, or to discharges granted
    at the conclusion of preliminary inquiries, because no right of appeal exists
    in either case.  Besides, judges presiding at preliminary inquiries cannot make
    findings of fact, which are critical elements in issue estoppel.

[45]

Mr.
    Rippell contends that a CSO revocation hearing is more akin to a prosecution
    for breach of probation than any other kind of proceeding.  As with findings
    made at the conclusion of a prosecution for breach of probation, findings made
    at revocation hearings, he says, can satisfy the finality requirement in issue
    estoppel.  The fact that CSO revocation proceedings are sentencing proceedings,
    like proceedings under s. 724(2) of the
Criminal Code
, does not in
    itself foreclose issue estoppel under
R. v. Punko
, 2012 SCC 39, [2012]
    2 S.C.R. 396.  Further, policy considerations favour the application of issue
    estoppel in these circumstances because it encourages diligence by the Crown in
    collecting and presenting evidence at the revocation hearing, the object of
    which is to deprive the offender of his or her liberty.

The Governing Principles

[46]

This
    ground of appeal requires consideration of a further prerequisite for the
    operation of the doctrine of issue estoppel in a criminal case.  It is
    necessary to examine whether this requirement  finality of the estoppel-creating
    decision  bars the application of the doctrine where the finding said to
    create the estoppel occurred in sentencing proceedings.

The Finality Requirement

[47]

The
    second requirement of issue estoppel is that the estoppel-creating decision was
    final:
Mahalingan
, at para. 49.  Findings on particular issues at trial
    are final, absent appellate reversal:
Mahalingan
, at para. 55.

[48]

In
    many instances in which an accused seeks to invoke the preclusive effect of
    issue estoppel, the estoppel-creating proceeding and the proceeding in which
    the accused seeks to invoke the doctrine are both trials.  It is clear from
Mahalingan
that the doctrine can operate in both jury and non-jury trials and where the
    finding said to create the estoppel was a positive finding or a finding based
    on reasonable doubt:
Mahalingan
, at para. 31.

[49]

Since
    the proceeding alleged to create the estoppel in this case is not a trial
    proceeding, an issue arises whether a proceeding other than a trial can constitute
    an estoppel-creating proceeding that satisfies the finality requirement.

[50]

In
    both
Mahalingan
and the earlier case of
Grdic v. The Queen
,
    [1985] 1 S.C.R. 810, both the estoppel-creating proceeding and that in which
    the doctrine was invoked were trials.  But the terms trial, and proceeding
    and proceedings, appear in nearly equal measure in the decision in
Mahalingan
.
    On their face, the terms proceeding and proceedings include a trial but
    take in more ground than trial.  The terms proceeding and proceedings
    could include both pre-trial and sentencing proceedings.  Thus, it is helpful
    to examine some authorities in which an accused has tried to invoke issue
    estoppel when the estoppel-creating proceeding was not a criminal trial.

The Finality Requirement and Evidentiary
    Rulings

[51]

The
    terms proceeding and proceedings would include a
voir dire
to
    determine the admissibility of evidence, as well as a preliminary inquiry at
    the conclusion of which a justice is required to decide whether there is
    sufficient evidence to put an accused on trial for the offence charged or any
    other indictable offence in respect of the same transaction.

[52]

In
Duhamel v. The Queen
, [1984] 2 S.C.R. 555, the appellant was tried
    separately on two counts of robbery charged in the same indictment.  At the
    first trial, a
voir dire
was conducted to determine the admissibility
    of certain statements made by the appellant.  The trial judge ruled the
    statements inadmissible.  Duhamel was acquitted.  A different judge presided at
    the second trial.  Despite objections based on issue estoppel, the second trial
    judge conducted a
voir dire
and admitted the statements ruled
    inadmissible at the first trial.  Duhamel was convicted.  On appeal, he argued
    that issue estoppel precluded the Crown from re-litigating the admissibility of
    the statements ruled inadmissible at the first trial.

[53]

The
    Supreme Court of Canada unanimously affirmed the judgment of the Alberta Court
    of Appeal rejecting the extension of the doctrine of issue estoppel to include,
    as estoppel-creating findings, rulings on the admissibility of evidence, at
    least in the absence of a discrete right of appeal from decisions on
    admissibility.

[54]

In
Schweneke v. Ontario
(2000), 47 O.R. (3d) 97 (C.A.), this court observed
    that issue estoppel would not apply where the accused had been discharged at
    the conclusion of a preliminary inquiry into charges of fraud, to preclude the
    determination in a subsequent civil action of  whether he had in fact committed
    the alleged fraudulent acts.  The court pointed out that a judge presiding at a
    preliminary inquiry does not make findings of fact.  The judge decides only whether
    the evidence as a whole is sufficient to warrant a committal for trial.  Such a
    determination could
not
found a subsequent claim of issue estoppel.

The Finality Requirement and Sentencing
    Proceedings

[55]

In
Punko
, one of the appellants contended that issue estoppel could arise
    from findings of fact made by a sentencing judge under s. 724(2) of the
Criminal
    Code
after a jury trial.  A majority of the Court concluded that such a
    finding could not serve as the basis for a claim of issue estoppel.

[56]

Findings
    of fact under s. 724(2)(b) of the
Criminal Code
, the majority
    reasoned, do not constitute a judicial determination
on the merits
of
    the case. Rather, these findings are judicial determinations made only for the
    purpose of sentencing:
Punko
, at para. 11.  Findings of fact made by
    the sentencing judge under s. 724(2)(b) of the
Criminal Code
cannot be
    relied upon to support a claim of issue estoppel:
Punko
, at para.
    19.

[57]

Revocation
    hearings under s. 724.6 are sentencing proceedings  more accurately perhaps,
    the continuation of sentencing proceedings:
McIvor
, at para. 12.  Proof
    of a breach of a condition of the CSO is analogous to the proof of aggravating
    facts at the initial sentencing hearing:
McIvor
, at para. 12.  The
    offender is not charged with an offence and is not at risk of conviction.

Policy Considerations

[58]

To
    the extent that it remains unclear whether sentencing proceedings can serve as
    an estoppel-creating mechanism, it may be helpful to consider whether the
    policy considerations that are the genesis of the doctrine of issue estoppel
    favour one conclusion or the other in this case.  The relevance of policy
    considerations has been recognized in non-criminal cases, albeit in the context
    whether a court has a discretion to refuse to apply issue estoppel if it will
    work an injustice, even where the preconditions to its application have been
    met:
Penner v. Niagara (Regional Police Services Board)
, 2013 SCC 19,
    356 D.L.R. (4th) 595, at para. 8;
Danyluk v. Ainsworth Technologies Inc
.,
    2001 SCC 44, [2001] 2 S.C.R. 460, at paras. 62 and 67.

[59]

Issue
    estoppel serves three purposes.  Each purpose is integral to a fair system of
    criminal justice:

i.

fairness to the accused who should not be called upon to answer
    questions already decided in his or her favour;

ii.

the integrity and coherence of the criminal law; and

iii.

the institutional values of judicial finality and integrity.

Mahalingan
, at paras. 38-39, and 44-47.  See
    also,
Lucido v. Superior Court
, 51 Cal. 3d 335 (1990), at p. 343,
    where the Supreme Court of California concluded that the failure to prove the
    commission of an offence at a probation revocation hearing did not preclude a
    subsequent prosecution for the same offence.

The Principles Applied

[60]

I
    would give effect to this ground of appeal.  In my view, a CSO revocation
    decision should not be classified as a final decision capable of giving rise to
    the operation of issue estoppel in a subsequent criminal trial.  I have reached
    that conclusion for several reasons relating to:

i.

the nature of revocation proceedings;

ii.

the narrow scope of the doctrine of issue estoppel in criminal cases;
    and

iii.

the purposes that underlie issue estoppel.

[61]

First,
    revocation proceedings at their core are sentencing proceedings in which the
    offender is neither charged with an offence nor in jeopardy of further
    conviction on proof of further criminal conduct. The revocation hearing may be
    regarded as a continuation of sentencing proceedings where proof of a breach is
    analogous to the proof of aggravating facts:
McIvor
, at para. 12.
    Findings of fact made by a sentencing judge under s. 724(2)(b) cannot found an
    issue estoppel:
Punko
, at para. 19.  It would seem incongruous to
    permit findings made in some sentencing proceedings to serve as a foundation
    for the operation of the doctrine, yet deny the same status to others.

[62]

Second,
Mahalingan
makes the point that the operation of issue estoppel in
    criminal cases falls within a narrow compass responsive to the unique characteristics
    of criminal trials:
Mahalingan
, at paras. 2 and 17.  It would be
    inimical to such a restrictive scope to expand the doctrine to the
    circumstances revealed here.

[63]

Third,
    to permit CSO revocation proceedings to found the doctrine of issue estoppel would
    not be consistent with the policies that underlie the doctrine and its
    purposes.

[64]

Public
    confidence in the integrity of the judicial system is threatened whenever two
    tribunals render inconsistent verdicts.  Undoubtedly, applying issue estoppel
    in this case eliminated the possibility of any inconsistency between the CSO
    revocation and criminal trial determinations.  But we must remember that
    consistency is not the exclusive yardstick by which we gauge the integrity of
    judicial decisions.  We need also consider whether eliminating potential
    inconsistency  by displacing the full determination of factual issues  would
    undermine public confidence in the judicial system:
Lucido
, at p.
    347.

[65]

CSO
    revocation proceedings and criminal trials serve different public interests.
    Different concerns may shape the Crowns pursuit of each.

[66]

A
    CSO revocation hearing assesses whether conditions imposed as part of a
    sentence for a prior crime have been violated such that the prior sentence
    should be varied or terminated and the offender incarcerated.  Revocation
    hearings are part of the continuing consequences of an offenders original
    conviction.  Any sanction imposed follows from that crime, not from the
    substance of new criminal allegations against the offender.  If the Crown
    succeeds at the revocation hearing, the result is not a fresh conviction.
    Indeed, the result may be nothing at all, or at worst, termination of the CSO
    and incarceration.

[67]

The
    fundamental role and responsibility of the CSO revocation hearing judge is not
    to determine whether the offender is guilty of a crime.  The hearing judges
    job is to decide whether a breach of condition has been proven to have occurred
    and, if it has, what to do about it.  The limited nature and the likely timing
    of this hearing  within 30 days of the offenders arrest or compelled
    appearance, absent an extension  may mean that not all evidence bearing on the
    underlying factual allegations is available or adduced.

[68]

To
    pre-empt trial of a new charge by according preclusive effect to a revocation
    decision, which is designed to perform a wholly independent social and legal
    task, would undermine the function of the criminal trial process as the
    designated forum for ultimate determinations about guilt or innocence of
    newly-alleged crimes:
Lucido
, at p. 349.

[69]

From
    the point of view of judicial economy, we could say that the application of
    issue estoppel in circumstances like these:

i.

would reduce, by one, the number of court proceedings because of the
    preclusive effect of issues decided adversely to the Crown at the revocation
    proceeding; and

ii.

by increasing the stakes at the revocation hearing, might encourage the
    Crown to prosecute first and eliminate the need for a revocation hearing.

But there is another side  the importance of
    preserving the criminal trial process as the exclusive forum for deciding
    whether an alleged offender is guilty or innocent of committing new crimes:
Lucido
,
    at pp. 350-351.

[70]

It
    is self-evident that the application of issue estoppel in these circumstances
    would produce a result more favourable to the accused.  But issue estoppel is
    not intended to achieve favourable outcomes for the accused  it aims to
    achieve fairness, through the elimination of vexatious litigation.  And the
    essence of vexatiousness is not mere repetition of litigation.  Rather, it is
    harassment through baseless or unjustified litigation:
Lucido
, at p.
    351.  It is neither vexatious nor unfair for a person serving a conditional
    sentence to be subjected to both a revocation hearing and a criminal trial.
    Indeed, an informed public might expect no less.

[71]

As
    I have said, I would give effect to this ground of appeal.

Ground #3:  Failure to Consider Discretion

[72]

The
    final ground of appeal is an alternative claim of error advanced in the event
    that we determine that the doctrine of issue estoppel applies in this case.
    The submission is that the trial judge erred in failing to consider that she
    had a residual discretion
not
to apply issue estoppel even if all the
    requirements to invoke the doctrine were met.

[73]

It
    is perhaps unnecessary to consider this ground because I have concluded that
    issue estoppel did not bar re-litigation of the possession issue at trial.  But
    out of deference to the submissions of counsel, and in the event of further
    review, I will deal with the claim briefly.

The Decision of the
    Trial Judge

[74]

The
    reasons of the trial judge contain no reference to the availability of any
    residual discretion not to give effect to issue estoppel where the conditions
    for its application would otherwise be met.  The record with which we were
    provided reveals no mention of any such discretion.

The Arguments on Appeal

[75]

For
    the appellant, Mr. Dawson begins by readily acknowledging that this court has
    previously decided that, in a criminal case, a trial judge has no residual
    discretion to refuse to apply the doctrine of issue estoppel where the
    conditions precedent to its operation have been satisfied.

[76]

Mr.
    Dawson says that when an accused invites a trial judge to apply the doctrine of
    issue estoppel, the judge should nonetheless consider both of the following issues:

i.

whether the conditions precedent to the operation of the doctrine have
    been satisfied in the proceedings; and

ii.

if the conditions precedent have been established, whether the doctrine should
    be applied to preclude litigation of the common issue.

[77]

Mr.
    Dawson points out that the Supreme Court of Canada has held that in civil
    proceedings, a court retains a discretion not to apply issue estoppel, where to
    do so would cause a real injustice.  To decide whether to exercise this
    residual discretion, a court should consider several factors, including:

i.

the purposes, processes, and stakes involved in the prior proceedings;

ii.

whether a significant difference between the two proceedings would make
    for an injustice if the results of the first proceeding precluded the second
    proceeding;

iii.

whether the first proceeding was intended to create a final resolution;
    and

iv.

whether, at the time of the first proceeding, the parties reasonably
    expected that it would create a final resolution.

These principles, Mr. Dawson submits, should apply in
    criminal cases.  After all, the criminal law has always recognized discretion
    when an accused seeks a stay of proceedings.

[78]

For
    the respondent, Mr. Rippell takes the position that for nearly half a century
    the law in this province has been that, in criminal cases, a judge has no
    residual discretion to decline to apply the doctrine of issue estoppel where
    its conditions precedent have been established.  The decision in
Grdic
leaves no room for discretion.  And the court in
Mahalingan
makes no
    mention of discretion in advocating a simple, clear, narrowly-focused rule
    responsive to the unique characteristics of the criminal trial.

[79]

Mr.
    Rippell adds that, in principle, discretion should be accorded no place in the
    application of issue estoppel in criminal proceedings.  The doctrine controls
    the mischief of repetitious proceedings.  To import into issue estoppel a
    residual discretion would undermine the fairness and finality the doctrine was
    created to promote.

[80]

In
    the alternative, Mr. Rippell contends that recognition of a residual discretion
    would not yield a contrary result here.  The Crown could easily have
    established the respondents possession of cocaine at the revocation hearing by
    introducing statements of the seizing officers.  It failed to do so despite the
    significant issues at stake at the revocation hearing.  The Crown should not
    get a second chance.

The Governing Principles

[81]

For
    nearly half a century, the jurisprudence in this province has left no room for
    the exercise of a residual discretion in the application of the doctrine of
    issue estoppel.  Where the requirements for the application of the doctrine
    have been established, issue estoppel applies to preclude re-litigation of an
    issue decided in the accuseds favour at a prior trial:
R. v. Wright
,
    [1965] 2 O.R. 337 (C.A.), at pp. 340-341.

[82]

In
    non-criminal proceedings, the Supreme Court of Canada has recognized a residual
    discretion in the application of issue estoppel.  A court may decline to apply
    the doctrine where its application would create an injustice:
Penner
,
    at paras. 1, 31 and 36;
Danyluk
, at paras. 62-67.  In the context of
    court proceedings, the residual discretion is to be accorded a very limited
    application:
Danyluk
, at para. 62;
General Motors of Canada Ltd. v.
    Naken
, [1983] 1 S.C.R. 72, at p. 101.

[83]

The
    exercise of a residual discretion to decline to apply issue estoppel is
    governed by considerations of fairness.  Unfairness may arise in two principal
    ways that overlap and are not mutually exclusive.  First, the unfairness of
    applying issue estoppel may arise from the unfairness of the estoppel-creating
    proceeding.  Second, even where the prior proceeding was conducted with
    scrupulous fairness and in accordance with its purposes, it may be unfair to
    use the results of the estoppel-creating proceeding to preclude the subsequent
    proceeding:
Penner
, at para. 39.

[84]

To
    determine whether the operation of issue estoppel would create unfairness
    through according preclusive effect to the results of a prior proceeding in a subsequent
    proceeding requires a nuanced inquiry.  Relevant factors in this inquiry may
    include, but are not limited to:

i.

the nature and extent of any differences between the purposes, processes
    or stakes involved in the two proceedings (
Penner
, at paras. 42 and
    45);

ii.

the reasonable expectations of the parties in relation to the scope and
    effect of the prior proceeding as informed by the text and purpose of the
    enabling legislation (
Penner
, at para. 47);

iii.

the risk of adding to the complexity and length of the estoppel-creating
    proceeding by attaching undue weight to its results through the application of
    issue estoppel (
Penner
, at para. 62);

iv.

the availability of an appeal from the finding in the estoppel-creating
    proceeding (
Danyluk
, at para. 74); and

v.

whether, in all the circumstances of the case, the application of issue
    estoppel would work an injustice (
Danyluk
, at para. 80).

[85]

The
    decisions of the Supreme Court of Canada in
Grdic
,
Mahalingan
,
Punko
and
Duhamel
, contain no reference to a residual
    discretion to decline to apply issue estoppel in criminal cases.  The issue
    does not appear to have been raised in argument, much less discussed or decided
    by the Court.

The Principles Applied

[86]

But
    for the governing jurisprudence of the Supreme Court and this court, my
    conclusion regarding this ground of appeal might well be different.  However,
    in light of that jurisprudence by which this court is bound, I conclude that
    this ground of appeal must be rejected.

[87]

The
    decision of this court in
Wright
makes it clear that, in criminal
    cases, a judge has no discretion to refuse to apply issue estoppel where the
    conditions for its operation have been established.  No later decision of this
    court has overruled or qualified this unequivocal statement of principle in
Wright
.

[88]

Moreover,
    the decisions of the Supreme Court of Canada that recognize a residual
    discretion to decline to apply issue estoppel do
not
involve criminal
    proceedings as both the estoppel-creating and estoppel-applying proceedings.
    The majority in
Mahalingan
makes it clear that although issue estoppel
    in criminal cases shares many features with its civil law equivalent, criminal
    law issue estoppel is a stand-alone doctrine responsive to the unique
    characteristics of criminal trials:
Mahalingan
, at para. 2.

[89]

Finally,
    nothing said, or arising by necessary implication from anything said, in the
    Supreme Court of Canada jurisprudence on issue estoppel in criminal law casts any
    doubt on the no discretion principle pronounced in
Wright
.

CONCLUSION

[90]

For
    these reasons, I would allow the appeal, set aside the stay of proceedings
    entered by the trial judge, and order a new trial on the count charging the
    respondent with possession of cocaine for the purpose of trafficking.

Released: January 20, 2014 (EAC)

David Watt J.A.

I agree.  E.A. Cronk J.A.

I agree.  K. van Rensburg
    J.A.

[1]
Failure to comply with the terms of a form of judicial interim release is also
    an offence triable either way under s. 145(3)-(5.1) depending on the form of
    release.


COURT OF APPEAL FOR ONTARIO

CITATION: R. v. Werth, 2014 ONCA 50

DATE: 20140122

DOCKET: C57260

Feldman, MacFarland and Pepall JJ.A.

BETWEEN

Her Majesty the Queen

Respondent

and

Shawn Werth

Appellant

Shawn Werth, acting in person

Andrew Faith, duty counsel

Vanita Goela, for the respondent

Heard and released orally:  January 14, 2014

On appeal from the conviction entered on October 30, 2012
    and the sentence imposed on May 8, 2013 by Justice Joseph B. Wilson of the Ontario
    Court of Justice sitting without a jury.

ENDORSEMENT

[1]

The appellant appeals his sentence solely on the basis of the credit he
    received for pretrial detention of one year. The trial judge at p. 35 of his
    reasons said:

Having considered the evidence I am not persuaded in the
    circumstances of this case that there is anything exceptional about Mr. Werths
    pretrial custody that would merit an enhanced credit.

It is the use of the word exceptional that gives
    rise to this appeal.

[2]

The appellant concedes that two and one-half years is a fit sentence,
    but on the basis of this courts decision in
R. v. Summers
, 2013 ONCA
    147, 114 O.R. (3d) 641 says that he is entitled to credit of 1.5 to 1 as
    opposed to the 1 to 1 which the trial judge gave him. It is true that in
Summers,
    supra
, it was held that the word exceptional does not appear in the
    language of the statute nor should it be read into the language.  See para. 81,
Summers, supra
.  Here the trial judge erred and used the wrong test.

[3]

Before us both Crown and the appellant concede that two and one-half
    years is a fit sentence.  Accordingly, the credit to be applied is then
    calculated against that sentence. Based on the sentencing submissions and the
    record before him, there was information that supports enhanced credit being
    given. This includes his likely eligibility for early release.  The appellant
    committed no breach of his bail when he was on bail, he was well behaved while
    in custody, and he did nothing to delay his time in pretrial custody.  See also
Summers, supra
, paras. 123 and 125.

[4]

In our view, enhanced credit was justified in the circumstances. The
    appellant should have been credited on the basis of 1.5 for the year he spent
    in pretrial detention.

[5]

In the result, the sentence of 30 months should be reduced by 18 months
    to leave a net sentence of incarceration of 12 months.  Additionally there was
    a term of two years probation.

K. Feldman J.A.

J. MacFarland J.A.

S.E. Pepall J.A.


COURT OF APPEAL FOR ONTARIO

CITATION:
    Risalsdar v. Ali, 2014 ONCA 59

DATE: 20140123

DOCKET: C57418

Hoy A.C.J.O., Cronk and Epstein JJ.A.

BETWEEN

Jamil Risalsdar, Sajid Kazi and Altaf Qazi

Applicants (Respondents)

and

Muhammed Naeem Ali and Sabaa Yasmine Shaikh

Respondents (Appellants)

Amandeep S. Dhillon, for the appellants

David A. Seed, for the respondents

Heard and released orally: January 17, 2014

On appeal from the judgment of Justice John Murray of the
    Superior Court of Justice, dated July 2, 2013.

ENDORSEMENT

[1]

The respondents are judgment creditors of the appellants.  By order
    dated July 2, 2013, on application by the respondents, the application judge
    set aside a settlement agreement entered into by the parties on the ground that
    it was obtained by misrepresentation and, hence, was unenforceable.  He also
    ordered that certain funds now held in trust by the appellant Sabaa Shaikhs
    real estate solicitor be released to the respondents to the extent necessary to
    satisfy their outstanding judgments against the appellants. He therefore also
    dismissed a cross-application brought by the appellants to enforce the
    settlement agreement.

[2]

The appellants appeal from the application judges ruling.

[3]

The appellants advance three main arguments in support of their appeal.
    First, they submit that the application judge erred by making key factual
    findings that are not supported by the evidentiary record.  In particular, they
    say that the application judge erred by finding that: (1) they induced the
    respondents to enter into an agreement to settle their claims against the
    appellants by way of misrepresentations regarding the appellants financial
    affairs; and (2) the misrepresentations in question were relied upon by the
    respondents in concluding the agreement.

[4]

We would not give effect to this ground of appeal.

[5]

The application judge found that, notwithstanding the respondents
    contention to the contrary, the parties entered into an agreement to settle the
    respondents claims against the appellants.  He also found, however, that the
    respondents were induced to enter into the settlement agreement by the
    appellants intentional misrepresentations concerning their ability to pay the
    outstanding amounts owed under the two judgments and, further, that the
    respondents relied on those misrepresentations, to their detriment.

[6]

There was ample evidence before the application judge to support these
    findings.  The record established that, in late May 2012, a solicitor who acted
    for at least the appellant Muhammed Ali and who was in communication with the
    appellant Sabaa Shaikh, informed a lawyer who was attempting to collect on the
    debts owed to the respondents that:

(1)

the
    appellants do not have any further ability to raise funds; and

(2)

Mr. Ali
    believed that, at best, he would be able to get $1,000 - $2,000 from [the
    appellant Sabaa Shaikh].

[7]

Following these statements, the lawyer who was attempting to recover the
    respondents funds submitted a settlement offer to Mr. Alis solicitor.  It is
    that offer that formed the basis of the settlement later sought to be enforced
    by the appellants.

[8]

However, there was evidence that when the statements quoted above were
    made, and unbeknownst to the respondents, Ms. Shaikh had agreed to sell the
    appellants former matrimonial home, against which the respondents had
    registered executions, and that the transaction was scheduled to close within
    days.  Further, the anticipated proceeds of sale were sufficient to pay the
    outstanding monies owed to the respondents.

[9]

In these circumstances, the application judge was fully justified in
    setting aside the settlement agreement on the basis of material
    misrepresentations.  The appellants have failed to demonstrate that the
    application judges impugned findings are tainted by palpable and overriding error.
    Accordingly, there is no basis for appellate intervention with these findings.

[10]

The
    appellants next argue that the application judge erred by failing to convert
    the competing applications before him into a trial of an issue to determine the
    enforceability of the settlement agreement.  We disagree.

[11]

At
    no time did the appellants seek an order from the application judge for the
    trial of an issue.  Nor, in light of the written record before the application
    judge, was a trial required to resolve the question whether a binding and
    enforceable settlement agreement had been entered into.  The appellants
    essentially acknowledged as much in their cross-application when they sought,
    as primary relief, a declaration that an enforceable settlement agreement had
    been entered into by the parties and orders compelling its enforcement.  The
    application judges findings regarding the existence of an enforceable
    settlement agreement responded in part to the issues raised in the appellants
    own cross-application.

[12]

Finally,
    the appellants submit that the trial judge erred by failing to provide any or
    sufficient reasons for his ruling.  We reject this argument.

[13]

The
    application judge provided oral reasons for the core of his decision and
    supplemented those reasons with a short written endorsement.  He also inquired
    of counsel whether any of the parties wished him to reserve his decision in
    order to deliver lengthier, written reasons.  None of the parties requested
    that he do so.

[14]

Although
    the application judges reasons are expressed in brief compass, when viewed in
    light of the entire record, as they must be, they meet the standard for
    sufficiency of reasons set out in
R. v. Sheppard
, 2002 SCC 26, [2002]
    1 S.C.R. 869.

[15]

The
    appeal is dismissed.  The respondents are entitled to their costs of the appeal,
    fixed in the total amount of $11,400, inclusive of disbursements and all
    applicable taxes.

Alexandra Hoy
    A.C.J.O.

E.A. Cronk
    J.A.

Gloria Epstein
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Royal Bank of Canada v. Ultimate Holographic
    Reproductions Inc., 2014 ONCA 38

DATE: 20140117

DOCKET: C56917

Rosenberg, MacPherson and LaForme JJ.A.

BETWEEN

Royal Bank of Canada

Plaintiff (Respondent)

and

Ultimate Holographic Reproductions Inc.,
Salvatore C. Vivona
and Leonhard Schuko

Defendants (Appellant)

Alfred S. Schorr, for the appellant

Nicole Brown Dunbar, for the respondent

Heard: January 8, 2014

On appeal from the judgment of Justice Alan C. R. Whitten
    of the Superior Court of Justice, dated March 27, 2013.

ENDORSEMENT

[1]

The appellant argues that the motion judge erred in granting summary
    judgment because the respondent did not comply with the terms of the
    Regulations to the
Canada Small Business Financing Act
, S.C. 1998, c.
    36. Section 14(1) of the Regulations provides as follows:

A lender must, when making a loan referred to in
    any of paragraphs 5(1)(
a
) to (
c
), take valid and enforceable first-ranking security in the assets of
    the small business whose purchase or improvement is to be financed by the loan.

[2]

Due to an error by the respondent it did not have
    first-ranking security in the assets of the small business. The appellant
    argues that because the lender did not comply with s. 14(1), its guarantee was
    not valid. He also argues that article (3) of the guarantee violated the terms
    of the Act and regulations. Article 3 provides that the Bank was not bound to
    exhaust its recourse against the customer or others before being entitled to
    payment from the guarantors.

[3]

In granting summary judgment, the motion judge held
    that the statute and regulations only determine the extent of the risk to the
    lender and not the contractual relationship between the parties. This holding
    is consistent with other decisions of the Superior Court of Justice. For
    example, in
ACFMD 2005 Inc. et al. v. Pizza One Group Inc. et al
., 2006 CanLII 19426, Ground J. held at para. 4, that any breach of the
    regulations would only affect the claim by the bank against the government for
    reimbursement. Further, the Act does not give any right of action to the borrower
    or the guarantors.

[4]

In this case, we need not decide that the Act and
    regulations give no remedy to the borrower or guarantors or that breach of the
    Act and regulations would have no effect on the validity of the guarantee. We
    are satisfied that the failure of the bank to obtain first-ranking security in
    the circumstances of this case does not invalidate the guarantee nor provide
    the appellant with any remedy. The appellant adduced no evidence on the motion
    for summary judgment that he was in any way misled by the respondent when he
    entered into the guarantee. The respondent was therefore entitled to enforce
    the guarantee in accordance with its terms.

[5]

We are also satisfied that article 3 of the
    guarantee did not violate the Act or regulations. The article is not
    inconsistent with anything in the Act or regulations. In particular, the
    guarantee is not inconsistent with s. 37 of the Regulations which simply
    requires the lender to realize on any security, guarantee or suretyship before
    submitting a claim to the Minister under s. 38. The demand made by the
    respondent in this case is consistent with the Regulations.

[6]

Accordingly, the appeal is dismissed. The
    respondent is entitled to its costs which we fix at $8,000 inclusive of HST and
    disbursements.

M.
    Rosenberg J.A.

J. C.
    MacPherson J.A.

H. S.
    LaForme J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Silvio v. 698743 Ontario Limited (J.
    DiFranco & Son Construction), 2014 ONCA 17

DATE: 20140109

DOCKET: C56604

Rosenberg, MacPherson and LaForme JJ.A.

BETWEEN

Darrin Silvio, Delores
    Beardwood and Darren Silvio Jr.

Plaintiffs (Respondents)

and

698743 Ontario Limited
    cob as J. DiFranco & Son Construction and Domenic DiFranco

Defendants (Appellants)

Alan Rachlin, for the appellant

Peter Lingard, Kiran Sah and Avery Dyck, for the
    respondent

Heard: January 7, 2014

On appeal from the judgment of Justice James A. Ramsay of
    the Superior Court of Justice, sitting with a jury, dated January 17, 2013.

ENDORSEMENT

[1]

The appellants, 698743 Ontario Limited cob as J. DiFranco & Son
    Construction and Domenic DiFranco appeal from the judgment of Ramsay J. of the
    Superior Court of Justice, sitting with a jury, dated January 17, 2013.  The
    only issue at the eight-day trial was liability and the jury apportioned liability
    as follows: the appellants  53 per cent, the respondent Darren Silvio  26 per
    cent; and the non-party Conrad Niessen  21 per cent.  Based on this
    apportionment and a pre-trial agreement as to a ceiling on the damages the
    plaintiffs could recover, the judgment awarded the plaintiffs damages of
    $1,100,000 and costs of $295,000.  The appellants appeal on several grounds.

[2]

First, the appellants assert that the trial judge did not properly
    charge the jury on the issue of proximate cause and, in particular, failed to
    charge the jury that they could find Mr. Silvio was solely responsible for his
    injuries.

[3]

We do not accept this submission.  In the component of his charge
    dealing with causation, the trial judge explained the but for test for
    causation and told the jury that they could find one or more proximate causes
    of the incident.  This was consistent with the leading causation case,
Resurfice
    Corp. v. Hanke
, 2007 SCC 7, at para. 21, and with the apportionment scheme
    of the
Negligence Act
, R.S.O. 1990, c. N. 1, s. 3.

[4]

Even if there was an error of law, we would apply s. 134(6) of the
Courts
    of Justice Act
and find that no substantial wrong or miscarriage of
    justice occurred.  The appellants theory on this issue depended upon Mr.
    Silvio having seen that the second barrier had been removed.  The jurys answer
    to Question 6 on the Verdict Sheet shows that the jury accepted that Mr. Silvio
    did not recognize the danger.

[5]

Second, the appellants contend that the trial judge erred in entering
    judgment for the respondents given their finding that the site was secure.
    The appellants rely upon s. 3(3) of the
Occupiers Liability Act
,
    R.S.O. 1990, c. O. 2.

[6]

We disagree.  The trial judge carefully reviewed the evidence about
    whether the appellants had taken proper steps to modify or exclude their duty
    to make their property reasonably safe for persons entering the premises.
    Moreover, in our view, the jurys written answer to Question 2 on the Verdict
    Sheet evinces a clear understanding of the operation of s. 3(3) of the
Negligence
    Act
:

3) Although the site was secure, DiFranco Construction failed
    to communicate to Highpoint Construction that they (Highpoint) were to be
    excluded from the site as of October 21
st
until October 24
th
.

[7]

The fact that the work site of the partly-built house was secure did
    not in the circumstances exclude liability under s. 3(3) given that Highpoint
    had been told it needed to fix the defects.  Its employees, including Mr.
    Silvio, could only do so by entering the site.

[8]

Third, the appellants contend that the trial judge compromised trial
    fairness by improperly interfering with the defendants cross-examination of
    witnesses.  They set out eight examples in their factum.

[9]

We do not accept this submission.  In the context of an eight-day trial,
    the small number of interventions during the defendants cross-examination of
    witnesses were directed at clarification of a witness evidence, ensuring that
    the defendants counsel was reading properly from an Examination of Discovery
    transcript, and limiting the number of times a question could be asked.
    Although we might say that a couple of the trial judges interventions were
    unnecessary, we do not say that they were inappropriate.  In any event, they
    were far removed from the types of interventions discussed by this court in
McFarlane
    v. Safadi
(2004), 70 O.R. (3d) 599,
Ross v. Hern
, [2004] O.J. No.
    1186, and
Sargent v. Plaza Ontario Marble and Tile Inc.
, (2005), 205
    O.A.C. 249.

[10]

Fourth,
    the appellants submit that the trial judge compromised trial fairness by providing
    an unfair and unbalanced summary of the evidence in his charge to the jury.

[11]

We
    disagree.  The trial judges jury charge was brief  24 pages.  In our view, it
    was an adequate presentation of the evidence and positions of both sides; we
    see no unfairness or imbalance in the trial judges summary of the evidence
    that would warrant reversal given the issues that needed to be determined.

[12]

Fifth,
    the appellants seek to introduce fresh evidence in the form of an affidavit of
    David OBrien, the defendants co-counsel at trial.  Mr. OBrien affirms that,
    just before the second day of the jurys deliberations, and after the
    defendants had made their objections the previous day to the jury charge (the
    trial judge accepted one objection and re-charged accordingly), and after the
    jury had asked a question during their deliberations, which the trial judge
    answered, the trial judge erred by not acceding to the defendants counsels
    request to make further objections to the jury charge.

[13]

The
    appellants did not strongly press their motion to admit fresh evidence.
    Whatever the merits of the trial judges decision, it had no impact on the
    fairness of the trial or the appellants ability to make submissions on
    appeal.

[14]

We
    observe that we have not taken into account any failure to object in disposing
    of the grounds of appeal.

[15]

The
    appeal is dismissed.  The respondents are entitled to their costs of the appeal
    fixed at $40,000, inclusive of disbursements and HST.

M.
    Rosenberg J.A.

J.C.
    MacPherson J.A.

H.S.
    LaForme J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Smith v. Waterloo Taxi Limited, 2014
    ONCA 37

DATE: 20140117

DOCKET: C56864

Epstein, Tulloch and Pardu JJ.A.

BETWEEN

Derek Stephen Smith and Richard Emil Disano

Plaintiffs (Respondents)

and

Waterloo Taxi Limited

Defendant (Appellant)

Steven D. Gadbois, for the appellant

Justin Heimpel, for the respondents

Heard: December 13, 2013

On appeal from the judgment of Justice
Harrison
    S. Arrell

of the Superior Court of Justice,
    dated March 8, 2013, with reasons reported at 2013 ONSC 1466.

ENDORSEMENT

[1]

Waterloo Taxi Limited appeals from a decision granted on a summary
    judgment motion concluding that it had wrongfully removed Richard Emil Disano
    from its roster of approved drivers.

[2]

Waterloo terminated Disano because it alleged that he was covertly
    getting access to confidential information so that he could position his car to
    be the primary responder to highly sought-after pre-booked out-of-town calls.
    It alleged that with the advance knowledge of the pick-up location for such
    calls, he would station himself nearby, and therefore get the first chance at
    the fares.

[3]

Waterloo Taxi initially based the termination on the ground that Disano
    was getting a disproportionately large number of these out-of-town calls
    compared to other drivers.  However, as the action progressed it became clear
    that Waterloo Taxis initial allegations about the number of out-of-town calls
    to which Disano was the primary responder were not borne out by the evidence.  Waterloo
    Taxi therefore sought out other evidence to support its case.

[4]

Waterloo Taxi filed an affidavit based on information and belief
    containing new allegations, for example, that Disano had come into the dispatch
    office and looked at the dispatch book.  It also stated that it had information
    from Janet Musclow, who worked in the dispatch office with Disanos wife that
    on a minimum of 10-20 occasions she saw Disanos wife write down information
    about pre-booked out-of-town trips on a scrap piece of paper and put it in her
    purse.  Waterloo Taxi relied on this new evidence to suggest a substantial
    pattern of cheating.  The problem with this new approach, once again lay in the
    numbers: there was simply no evidence that Disano was the primary responder in
    a disproportionately high number of out-of-town calls.

[5]

Moreover, Disano answered these new allegations with direct evidence.
    For example, his wife swore an affidavit denying the conduct attributed to her,
    describing how she had not even worked the same shifts as Musclow, and therefore
    that the latter could not have seen what she purported to have seen.

[6]

The appellant submits that the motion judge erred by discounting the
    evidence provided on information and belief in its affidavit.  This was a
    simplified procedure action under Rule 76.  Since cross-examinations on
    affidavits are not permitted in these actions, reliance on information and
    belief does not have the effect of shielding the source of the information from
    cross-examination.  The appellant argues that for this reason, no adverse
    inference should be drawn from reliance on hearsay evidence.

[7]

However, rule 20.02(1) specifically provides that on a summary judgment
    motion the court may, if appropriate, draw an adverse inference from the
    failure of a party to provide the evidence of any person having personal
    knowledge of contested facts.

[8]

Rule 20.04(2.1) provides that, in determining whether there is a genuine
    issue for trial, a judge may weigh the evidence, evaluate the credibility of a
    deponent and draw any reasonable inference from the evidence.

[9]

There is no suggestion here that the motion judge did not apply the
    correct test for deciding whether to grant summary judgment.  Rather, the
    complaint is about the way he weighed the evidence.  Under these circumstances,
    the deferential standard of palpable and overriding error applies:
Combined
    Air Mechanical Services Inc. v. Flesch
, 2011 ONCA 764, 108 O.R. (3d) 1, at
    para. 71.

[10]

Given
    the seriousness of the allegations of cheating and their centrality to the
    litigation, the motion judge did not err in his treatment of Waterloos Taxi
    evidence and in preferring the Disanos direct, specific responding evidence,
    particularly in the context of ultimately undisputed evidence that the
    proportion of primary calls received by Disano was not high enough to be of
    concern.

[11]

We
    see no basis to interfere with the motion judges conclusion that he could
    fully appreciate the evidence and issues on the basis of the motion record, or
    in the manner in which he weighed the evidence.

[12]

For
    these reasons, the appeal is dismissed with costs to the respondents fixed at
    $10,000 inclusive of H.S.T. and disbursements.

Gloria Epstein J.A.

M. Tulloch J.A.

G.
    Pardu J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: United States v. Pakulski, 2014 ONCA 81

DATE: 20140129

DOCKET: C55827 and C57319

Feldman, Pepall and Tulloch JJ.A.

IN THE MATTER OF an appeal of a committal order pursuant
    to s. 49 of the
Extradition Act
, S.C. 1999, c. 18

BETWEEN

The
    Attorney General of Canada on behalf of the United
    States of America and Minister of Justice

Respondents

and

Joanna Pakulski

Applicant/Appellant

Joanna Pakulski, in person

Jill Copeland, Duty Counsel for the appellant

Heather J. Graham, for the respondent

Heard: January 13, 2014

On appeal from the committal order of Justice S.G. Himel of
    the Superior Court of Justice, dated July 31, 2012 and judicial review of the
    order of surrender of the Minister of Justice.

ENDORSEMENT

[1]

The appellant appeals an order committing her into custody for the
    purposes of extradition to the United States to face drug trafficking charges.
    She  also seeks judicial review of the order of surrender made by the Minister
    of Justice.

[2]

Dealing first with the appeal of the committal order, the appellant
    submits that the committal judge erred in two ways. The first was by excluding
    evidence the appellant wished to lead to attack the credibility of the
    co-operating witnesses  to show that they had motive to lie. The second was
    that the committal judge erred by relying on a previous version of the
    appellants factum.

[3]

In our view, there is no merit to either of these grounds of appeal.

[4]

The committal judge gave detailed and careful reasons for her decision
    and we agree with them.   The proposed evidence was properly excluded for the
    reasons advanced by her.  As the committal judge noted, credibility issues
    should be resolved by the trier of fact.   Moreover, quite apart from the
    statements of the two co-operating witnesses, the US $59,540 found in the
    appellants car supported the absence of any manifest unreliability in the
    evidence contained in the record of the case.  We are also not  persuaded that
    the wrong factum was relied upon by the committal judge.

[5]

In conclusion, the committal judge accurately characterized and
    considered the nature and context of the evidence and applied the correct legal
    principles.  We see no error.  The committal appeal is dismissed.

[6]

Turning to the request for judicial review of the Ministers decision, the
    applicants funding application was dismissed and she has been
    self-represented.  There is no dispute that neither the applicant nor the respondent
    made any mention in their communications with the Minister that the applicant
    had recently given birth to a child.

[7]

The Crown submitted that, pursuant to s. 43(2) of the
Extradition
    Act
, s. C. 1999, c. 18, at any time it was open to the applicant to ask
    the Minister to accept further submissions and to reconsider his decision in
    light of the fact that she is a single mother who recently gave birth to a
    child. However, she had failed to do so.

[8]

The appellant relies on a previous decision by the Minister,
The
    Attorney General of Canada on behalf of the United States of America and
    Minister of Justice v. Tania Siyam
, December 12, 2006, where the Minister,
    in reconsidering a surrender decision, observed that a newborn is an important
    factor in determining whether surrender would be unjust or oppressive.

[9]

Under the exceptional circumstances of this case, where the applicant
    was unrepresented when she made her submissions to the Minister, she had a
    newborn which is a relevant fact, and the Crown was aware that that fact was
    not included in the original submission, we are of the view that the motion for
    judicial review should be adjourned to give the applicant the opportunity to ask
    the Minister to accept further submissions and to advise the Minister of her
    circumstances.  There is judicial precedent for such an approach.  See
United
    States v. Johnstone
, 2013 BCCA 2 at para. 61.

Result

[10]

The
    appeal from the committal order is dismissed.

[11]

The
    application for judicial review is adjourned. The applicant shall have 30 days
    to make further submissions to the Minister. Once a response has been received,
    the applicant, Crown counsel and Ms. Copeland shall seek a date before this
    panel for the matter to be returned.

[12]

The
    applicant was granted bail pending both appeals. Following the applicants
    surrender to receive these reasons, the court will approve bail on the same
    terms pending the judicial review.

K. Feldman J.A.

S.E. Pepall J.A.

M. Tulloch J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: United States v. Talashkova, 2014 ONCA 74

DATE: 20140129

DOCKET: C56798 and C57542

MacPherson, Gillese and Hourigan JJ.A.

BETWEEN

The Attorney General of Canada on behalf of the
    United States of America and the Minister of Justice

Respondents

and

Marina Talashkova

Appellant/Applicant

Tyler Hodgson, for the appellant/applicant

Faiyaz Amir Alibhai and Richard Kramer, for the
    respondents

Heard: January 21, 2014

On appeal from the committal order of Justice John B.
    McMahon of the Superior Court of Justice, dated February 21, 2013, and on
    application for judicial review of the surrender order of the Minister of
    Justice dated July 24, 2013.

By the Court:

[1]

The appellant is sought for prosecution in the United States District
    Court for the Central District of California for fraud and money laundering
    offences flowing from an alleged Internet sales fraud scheme. McMahon J. denied
    her application for a stay of proceedings and found that she should be committed
    for extradition. The Minister of Justice subsequently ordered her
    surrender.  The appellant appeals the committal order and applies for
    judicial review of the surrender order. She also brings an application for the
    admission of fresh evidence.

[2]

The appellant submitted before the extradition judge and on this appeal
    that Canada Border Services Agency (CBSA) officials acted in a manner that
    violated her rights under the
Immigration and Refugee Protection Act
(
IRPA
)
    and s. 7 of the
Canadian Charter of Rights and Freedoms
. Among other
    things, she relies upon the following conduct: inquiries made by a CBSA
    official of United States officials regarding potential extradition, failure to
    ensure that she obtained a timely review of her detention, failure to afford
    her an opportunity to voluntarily withdraw from Canada, improper consideration
    of extradition as a factor in deciding whether she was inadmissible to Canada
    and the redaction of a s. 44(1) report to delete any reference to extradition.

[3]

The appellant submits that this conduct amounted to an abuse of process
    under the residual category of abuse of process identified in
R. v. OConnor
,
    [1995] 4 S.C.R. 411, and that a stay of proceedings pursuant to s. 24(1) of the
Charter
is the appropriate remedy.

[4]

The extradition judge concluded that the CBSA officials did not engage
    in any deliberate misconduct and that they had lawful grounds to find the
    appellant inadmissible to Canada pursuant to s. 36(1)(c) of the
IRPA
. He
    did have concerns about the conduct of CBSA officials involved in the case,
    specifically their violation of the CBSAs policies designed to separate
    immigration and extradition procedures. However, the extradition judge
    concluded that the appellant had not met the test for a stay.

[5]

On this appeal the appellant
    submits that
the
extradition
judge
    erred in applying the test for abuse of process by focusing on the effects of
    the abuse on trial fairness rather than the administration of justice. She also
    argues that the
extradition
judge erred
    in law in finding that bad faith for
Charter
purposes is limited to
    wilful or deliberate misconduct. Finally, the appellant submits that the
extradition
judge erred by misapprehending
the evidence on critical issues.

[6]

A stay is a remedy of last resort which will only be employed to rectify
    an abuse of process in the clearest of cases:
R v. Regan
, 2002 SCC 12,
    [2002] 1 S.C.R. 297, at para. 53. In the context of the residual category of
    abuse of process, a stay will only be justified where the alleged misconduct
    amounts to unfairness or vexatiousness of such a degree that it contravenes
    fundamental notions of justice and thus undermines the integrity of the
    judicial process:
OConnor
,

at para. 73.

[7]

As a discretionary decision, the determination of whether to grant a
    stay attracts considerable appellate deference.

Intervention is not
    justified unless the appellant can establish that the judge at first instance
    has misdirected herself or the decision is so wrong that it would amount to an
    injustice. Where the judge at first instance exercises her discretion, that
    decision cannot be replaced simply because the appellate court takes a
    different view of the facts. Rather, findings of fact should not be disturbed
    absent a palpable and overriding error in the assessment of the evidence:
Regan
,
    at paras. 117-18.

[8]

This deferential imperative is particularly pronounced in extradition
    cases, such as the case at bar, where the application judge has had the benefit
    of
viva voce
evidence. As previously noted by this court, the
    extradition judge had the opportunity to observe the witness and hear his
    testimony first hand. He was, therefore in the best position to determine the
    facts:
United States of America v. Wilson
(2002)
,
170 C.C.C.
    (3d) 527 (Ont. C.A.), at para. 47.

[9]

Contrary to the appellants submission, the fact that the extradition
    judge considered the effect of the CBSA officials conduct on the fairness of
    her immigration process does not amount to an error in law. A stay in the
    context of the residual category of abuse of process is by its nature a
    flexible remedy which requires the court to have regard to all the
    circumstances of the case. Prejudice to the accuseds rights, while not
    determinative, is a relevant part of that analysis:
R. v. Nixon
,
2011
    SCC 34, [2011] 2 S.C.R. 566, at para. 41. A consideration of the effect of the
    impugned conduct on the appellants rights was a relevant inquiry in the
    broader analysis of the impact of such conduct on public confidence in the
    administration of justice.

[10]

The appellant is correct in her submission that
wilful
    or
deliberate misconduct is not a prerequisite
    for a finding of bad faith.
Negligence or wilful blindness on the part
    of the authorities can be inconsistent with good faith, and good faith may not
    be found where authorities violate, as a result of ignorance, established legal
    norms with which they should be familiar:
R. v. Grant
, 2009 SCC 32,
    [2009] 2 S.C.R. 353, at paras. 74-75.
However,
    we are unable to accede to the submission that the extradition judge equated
    bad faith with deliberate misconduct.
His careful and thorough reasons
    demonstrate that, having regard to the evidence before him and the findings he
    made based on that evidence, he concluded that the conduct of the CBSA
    officials did not warrant the imposition of a stay.

[11]

On
    the facts as found by the extradition judge, we see no error in his
    determination that a stay should not be granted. First, the extradition judge
    found that the CBSA officials were pursuing a valid immigration purpose and had
    valid grounds to determine both that the appellant was inadmissible to Canada
    and that she should be detained pending an admissibility hearing. Second, the
    extradition judge found that the CBSA officials actions were not undertaken to
    facilitate the extradition process. Third, he found that the United States and
    the Department of Justice acted properly throughout the process. Fourth, the
    extradition judge found that the decision of the Minister of Public Safety and
    Emergency Preparedness delegate to consider the irrelevant factor of
    extradition was a result of a lack of training and was not part of a deliberate
    effort to utilize the immigration system for a disguised extradition. Fifth, he
    found that the creation of a redacted report was not intended to and did not
    result in the misleading of the appellant or the Immigration and Refugee Board
    (IRB).

[12]

These
    were all findings that were open to the extradition judge to make and we are
    not satisfied that any of these findings were tainted by a material
    misapprehension of the evidence.

[13]

Specifically,
    there was no error in the extradition judges conclusion that both versions of
    the s. 44(1) report were before the IRB. Based on our review of the record
    filed on this appeal, it appears that the impugned report was made an exhibit
    before the IRB. Moreover, in his submissions to the extradition judge, counsel
    for the appellant submitted that there was only a possibility that both reports
    were not before the IRB.

[14]

The
    extradition judge also did not err with respect to his assessment of the
    evidence regarding the problems associated with allowing the appellant to
    withdraw from Canada. The extradition judge did not find that the appellant
    could only be returned to Russia on a direct flight. Instead, he accepted that
    while there is no requirement to return a party directly to her country of
    origin, the CBSA endeavours to avoid sending people to countries where there is
    a chance that that they will be returned to Canada. It was open to the
    extradition judge to accept this evidence.

[15]

With
    respect to the issue of the CBSA officials stopping the clock on the
    appellants detention review under s. 57(1) of the
IRPA,
we see no error
    in the extradition judges conclusion that any misunderstanding on the part of
    a CBSA official regarding the operation of the 48-hour period did not play any
    role in the appellants case. The officer who misunderstood the effect of
    weekends and holidays on the 48-hour period played no role in the appellants
    detention and only became aware of her existence on January 17, 2012, at
    approximately 3:45 p.m.

[16]

We
    find no palpable and overriding error in the extradition judges assessment of
    the evidence.

[17]

At their essence, the appellant's submissions amount to an
    invitation to this court to reweigh the evidence and substitute its discretion
    for that of the extradition judge. That, of course, is not the function of an
    appellate court. This is especially true in a case such as the case at bar
    where we are reviewing the discretionary decision of a judge in his
    determination of whether this was one of the clearest of cases warranting the
    imposition of a remedy of last resort.

[18]

In
    her application for judicial review, the appellant seeks an order setting aside
    the surrender order or in the alternative requests an order for additional
    disclosure of documents to be used on a redetermination by the Minister. No
    specific arguments regarding the reasonableness of the Minsters decision were
    raised in the appellants factum or in oral submissions, and we see no basis to
    interfere with the Ministers decision. Moreover, upon our review of the
    testimony of the CBSA officials, we are not satisfied that there is any
    evidence of material non-disclosure.

[19]

Finally,
    the appellant seeks leave to adduce fresh evidence regarding the issue of
    whether there was a lockdown on January 16, 2012 at the Vanier Centre for Women
    where she was being held. The application to adduce this new evidence is denied
    for two reasons.

[20]

First,
    the appellant has not offered any adequate explanation as to why she did not
    pursue her inquiries regarding the lockdown until August of 2013, some nine
    months after the hearing of the evidence.

[21]

Second,
    this evidence could only conceivably be relevant to the stay application if the
    appellant could establish that a CBSA official knew or ought to have known that
    there was no lockdown and that he/she purposely delayed the Ministers delegate
    review with the intention of assisting the United States with its extradition
    request. The proposed evidence is not capable of supporting this assertion.
    There was no evidence at the hearing and no subsequent evidence produced to
    suggest that the officials were aware or ought to have been aware that there
    was no lockdown at the facility. Thus, the proposed evidence is not
    sufficiently cogent that it could reasonably be expected to have affected the
    decision of the extradition judge to deny the stay application, and,
    accordingly, the application for the admission of the fresh evidence is denied.

[22]

The
    appeal and the application for judicial review are dismissed.

Released: January 29, 2014 EEG

J.C.
    MacPherson J.A.

E.E. Gillese J.A.

C.W.
    Hourigan J.A.