COURT OF APPEAL FOR ONTARIO

CITATION: Holmes v. Schonfeld Inc., 2016 ONCA 148

DATE: 20160224

DOCKET: C60734/C60744

Weiler, LaForme and Huscroft JJ.A.

BETWEEN

Scott Holmes and Jennifer Flynn

Plaintiffs (Appellants)

and

Schonfeld Inc.
and
    Bossy Nagy Geoffrey (BNG), previously known as the Michael Bossy Group

Defendant (
Respondent
)

AND BETWEEN

Scott Holmes and Jennifer Flynn

Plaintiffs

and

Schonfeld Inc.
and
Bossy Nagy Geoffrey (BNG), previously known as the Michael
    Bossy Group

Defendants (
Respondent
/
Appellant
)

Marc Munro, for the appellants Scott Holmes and Jennifer
    Flynn

Frank Bowman and Deepshikha Dutt, for the appellant
    Bossy Nagy Geoffrey (BNG), previously known as the Michael Bossy Group

Aubrey Kauffman and Dylan Chochla for the respondent
    Schonfeld Inc.

Heard: January 13, 2016

On appeal from the orders of Justice Thomas J. McEwen of
    the Superior Court of Justice, dated June 18, 2015, with reasons reported at
    2015 ONSC 3038.

Weiler J.A.:

A.

Overview

[1]

Schonfeld was appointed Monitor and Receiver over the assets,
    undertaking and properties of Holmes and Flynn and their companies. After
    Schonfeld was discharged, Holmes and Flynn were told by the Canada Revenue
    Agency (CRA) that, following a reassessment, they owed over one million dollars
    in unpaid taxes. Holmes and Flynn brought an action against Schonfeld, claiming
    that Schonfeld did not exercise reasonable care in managing Holmes and Flynns
    assets and that Schonfeld was obliged to engage in reasonable tax planning.

[2]

Holmes and Flynn also sued Bossy Nagy Geoffrey (BNG), their accountants
    and tax advisers before and during the receivership. BNG sought to bring a
    crossclaim (or, alternatively, third party claim) against Schonfeld.

[3]

Schonfeld successfully brought a motion to dismiss all claims against
    it. The appellants appeal.

B.

Issues on Appeal

[4]

The appellants Holmes and Flynn raise the following issues:

1.

Did the motions judge err in law in concluding that leave was required?

2.

Did the motions judge misapprehend the evidence and/or fail to consider
    relevant evidence?

3.

Did the motions judge apply the wrong test for granting leave?

4.

Did the motions judge err in concluding that the appellants Holmes and
    Flynn had not met the test for leave?

[5]

The appellant BNG raises the following issues:

1.

Did the motions judge err in concluding that the strong
prima facie
case standard should be applied to BNG?

2.

Did the motions judge err in failing to take into account the totality
    of evidence in concluding that BNGs claim against Schonfeld was without
    foundation and was frivolous and vexatious?

3.

Did the motions judge exceed its jurisdiction on a leave motion when he
    concluded that Schonfelds conduct did not meet the test for gross negligence?

C.

Facts

[6]

The appellants Scott Holmes and Jennifer Flynn are involved in
    longstanding and fractious litigation with Canadian National Railway (CN). On
    August 8, 2008, CN obtained a Mareva Order and an Anton Pillar Order against
    Holmes, Flynn, and the companies controlled by them (the Monitored Parties). On
    August 26, 2008, Schonfeld was appointed as Monitor to manage the assets and
    pay the legal fees and disbursements of the Monitored Parties. On December 4,
    2008, Schonfeld was also appointed Receiver of the Monitored Parties. Schonfeld
    was discharged on September 26, 2011. According to Holmes and Flynn, most of
    their assets were disbursed during the course of the receivership.

[7]

In early 2012, the CRA wrote several letters to Holmes and Flynn
    notifying them of outstanding tax liability for the years 2006-2009. This
    liability arose because Holmes and Flynn failed to repay loans made to them by
    their corporations; when not repaid within one year, these shareholder loans were
    considered income and taxed as such. This reassessment by the CRA resulted in
    Holmes and Flynn owing approximately $1 million in income tax.

[8]

On February 5, 2014, Holmes and Flynn brought an action against Schonfeld,
    claiming that Schonfeld failed to exercise a reasonable duty of care,
    supervision, and control over the management of their affairs during the course
    of the receivership. They argued that Schonfeld was obliged to engage in
    reasonable tax planning while managing their assets and should accordingly be
    liable for their post-discharge tax liability. Holmes and Flynn also brought an
    action against their accountants and tax advisors BNG, claiming that they also
    failed to fulfill their professional obligations. BNG brought a motion seeking
    leave to commence a crossclaim, or, alternatively, a third party claim, against
    Schonfeld.

[9]

Paragraph 7 of the Monitor Order stated that no proceeding shall be
    commenced against the Monitor without the Monitors consent or leave of the
    court. Paragraph 26 of the Receiver Order provided that nothing in that order
    shall derogate from the powers and protections described in the Monitor Order
    and that all provisions of the Monitor Order shall continue to apply to the
    activities of the Receiver. Both the Monitor Order and the Receiver Order limited
    Schonfelds liability to gross negligence or wilful misconduct. The Discharge
    Order contained a release of liability, again excepting gross negligence and
    wilful misconduct.

[10]

Because
    Holmes and Flynns action was commenced without the consent of Schonfeld and
    without leave of the court, Schonfeld brought a motion seeking an order
    dismissing the action and dismissing BNGs crossclaim. Holmes and Flynn denied
    that leave was required, but, in the alternative, asked for an order granting
    them leave
nunc pro tunc
.

D.

Decision Below

[11]

The
    motions came before McEwen J. He concluded that, on a plain reading of the
    Monitor, Receiver, and Discharge orders together, Holmes and Flynn required
    leave of the court to commence their action against Schonfeld. McEwen J.
    further held that, while Schonfeld would not suffer any prejudice or
    substantial injustice if leave were granted
nunc pro tunc
, leave
    should nevertheless be denied because it would not have been granted if sought
    at the appropriate time. He reasoned that, by virtue of the various orders,
    Holmes and Flynn would have to have a cause of action either in gross
    negligence or wilful misconduct, and that on either the regular standard for
    granting leave (where leave will be granted unless there is no foundation for
    the claim or the action is frivolous or vexatious) or the stricter standard
    (where leave will be granted if the plaintiffs can demonstrate a strong
prima
    facie
case), Holmes and Flynn could not succeed.

[12]

McEwen
    J. concluded that there was no foundation for the claim that Schonfelds
    conduct constituted a very marked departure from the standards by which a
    reasonable and competent receiver in the same circumstances would have
    conducted itself, nor was there a foundation for the claim that Schonfeld
    conducted itself with reckless indifference or in a manner that it knew was
    wrong.

[13]

Finally,
    McEwen J. concluded that BNG could not be in a better position to commence an
    action than Holmes and Flynn, and accordingly dismissed BNGs motion for leave.

E.

Analysis

(1)

Holmes and Flynns Appeal (C60734)

[14]

Whether
    or not leave is required for Holmes and Flynn to commence their action is a
    question of law and the standard of review is correctness. Assuming leave was required,
    the motions judges refusal to grant leave is a discretionary decision. This
    court should only interfere if the motions judge misdirected himself, came to
    a decision that is so clearly wrong that it amounts to an injustice, or if the
    motions judge gave no or insufficient weight to relevant considerations:
Penner
    v. Niagara Regional Police Services Board
, 2013 SCC 19, [2013] 2 S.C.R.
    125, at para. 27.

(a)

Did the motions judge err in law in concluding that leave was required?

[15]

Holmes
    and Flynn submit that they did not require leave to commence their action. A
    plain reading of the various orders shows that leave is required by the Monitor
    order and not by the Receiver order, and they sought to bring an action against
    Schonfeld in its capacity as Receiver. Although the appellants acknowledge that
    paragraph 26 of the Receiver Order incorporates the provisions of the Monitor
    Order, they submit that the powers and protections of the Monitor Order did not
    cover the activities of the Receiver. The appellants further argue the separate
    limitation of liability clause in paragraph 25 of the Receiver Order would be
    superfluous if paragraph 26 of the Receiver Order incorporated every protection
    afforded in the Monitor Order.

[16]

The
    trial judge did not err. The Receiver Order is supplemental to the Monitor
    Order. Properly interpreted, Schonfeld as Receiver is entitled to the
    protections of paragraph 7 of the Monitor Order, and leave is therefore
    required. The separate limitation of liability clauses do not detract from this
    interpretation. Furthermore, the Discharge Order expressly provides that
    Schonfeld will continue to have the full protections provided for in the
    Monitor and Receiver orders. I would reject this submission.

[17]

The
    next question is whether leave would have been granted, had it been sought at
    the appropriate time. In this regard the appellant makes several submissions.

(b)

Did the motions judge misapprehend the evidence and/or fail to consider
    relevant evidence?

[18]

The
    motions judge based his conclusion that Schonfelds conduct did not constitute
    gross negligence or wilful misconduct on five findings of fact. They are: a)
    the alleged tax liabilities began prior to Schonfeld becoming involved in the
    matter; b) Homes and Flynn were fully aware of the shareholder loans that had
    taken place; c) throughout the relevant time BNG provided accounting services
    and tax advice to Holmes and Flynn; d) Schonfelds mandate as Monitor/Receiver
    did not include providing the type of services to Holmes and Flynn that they now
    complain they did not receive; and, e) Homes and Flynn either consented to or
    did not oppose the order that limited Schonfelds liability and led to its
    discharge.

[19]

Holmes
    and Flynn attack these factual findings and argue that they lack any
    evidentiary foundation (or are immaterial) and should be set aside. They submit
    that while the tax liability began prior to the appointment of Schonfeld,
    Schonfelds mismanagement increased their tax liability over the course of the
    receivership, and that the potential tax debt could have been eliminated by
    simply moving funds from their personal accounts into the corporate accounts.
    They further submit that their personal knowledge of the existence of the
    shareholder loans is immaterial to whether Schonfeld fulfilled its duty of care
    as Receiver. Neither Schonfeld nor BNG consulted with the appellants regarding
    the management of their affairs.

[20]

The
    appellants main argument is that, contrary to the conclusion of the motions
    judge, the type of services involved  income tax advice  was very much
    within the mandate contemplated by the Receiver Order. Schonfeld was obligated
    to preserve, protect and maintain control of the property and had access to all
    of the financial statements and records showing the indebtedness. It also had
    the power to settle any debts and was obligated to try to realize on the assets
    of the related companies by collecting the shareholder loans. In addition to
    the terms of the Receiver Order, Schonfeld also had a common law duty to manage
    the property as a prudent business person would.

[21]

Holmes
    and Flynn further submit that the fact they did not oppose any of the orders
    that led to the termination of the receivership is immaterial because the tax
    liability only became apparent following the discharge of the receiver.

[22]

I
    would not give effect to these submissions. First, there is ample evidence to
    support the motions judges finding of fact that the tax liabilities began
    prior to Schonfeld becoming involved in the matter. Holmes admits that the
    re-assessment for the 2006 taxation year involved the advance of a loan and the
    failure to repay that loan with respect to taxation years that pre-dated the
    appointment of Schonfeld as Monitor or Receiver.

[23]

Second,
    the powers and authorizations given to Schonfeld as Receiver and Monitor were
    detailed and precise. The orders directed Schonfeld to liquidate particular
    assets, in a particular order and to use the proceeds to pay particular
    expenses. For example, in an email dated February 20, 2009, from Schonfeld to
    BNG, Schonfeld indicated that, The Order specifically indicates that funds
    from 2035113 are to be used to pay the legal fees which are covered in the
    Mareva. Had Schonfeld moved funds as the appellants submit it ought to have
    done, it would not have been in compliance with the orders.

[24]

In
    relation to Flynn, loans made to her and upon which she was reassessed were
    made by a numbered company which was not a Monitored Party under the Monitor
    Order or the Receiver Order and for which Schonfeld did not receive financial
    statements.

[25]

Third,
    in the same February 20, 2009 email, Schonfeld candidly told BNG that it did
    not know how certain payments were to be accounted for from a tax perspective,
    implying that it was up to BNG. BNG admits that it was, at all material times,
    the tax accountants of Holmes and Flynn and their companies. This role was
    disclosed to the Court in the first report of the Monitor dated November 14,
    2008. It stated that the Monitored Parties utilized the services of an
    independent accounting firm to prepare financial statements, statutory filings,
    and income tax returns, both personal and corporate. It also stated that the
    Monitor attended at the office of the accounting firm on a regular basis for
    the purpose of delivering accounting documents, tax forms and retrieving
    completed financial statements and tax returns. This evidence supports the
    trial judges finding that Schonfelds mandate as Monitor and Receiver did not
    include providing the type of services to Holmes and Flynn that they now
    complain they did not receive.

[26]

Finally,
    the motions judge was entitled to consider that Holmes and Flynn had actual
    knowledge of their shareholder loans. Schonfeld did not. For example, the
    Preliminary Summary of Assets and Liabilities As Identified by Scott Holmes indicates
    an amount of money due, as at June 30, 2008, to Monterey Consulting &
    Construction Ltd. Holmes is not a Shareholder of this company. Monterey is
    owned by 2035113 Ontario Ltd., and Holmes is the sole shareholder of that
    company. It appears that Holmes was reassessed by the CRA as a person
    connected with a shareholder pursuant to s. 15(2) of the
Income Tax Act
,
R.S.C. 1985, c. 1 (5th Supp.).

[27]

The
    motions judge was also entitled to take into consideration that Holmes and
    Flynns objection to the conduct of Schonfeld concerning the preservation and
    protection of their assets was not made in a timely fashion at the discharge
    hearing.

[28]

The
    motions judge did not misapprehend the evidence. The fact that the motions
    judge did not advert to some of the evidence upon which the appellants rely
    does not mean that he failed to consider it: see
Housen v. Nikolaisen
,
    2002 SCC 33, [2002] 2 S.C.R. 235, at para. 46;
Canadian Broadcasting Corp.
    Pension Plan v. BF Realty Holdings Ltd.
(2002), 160 O.A.C. 72 (C.A.), at
    para. 64.

(c)

Did the motions judge apply the wrong test for granting leave?

[29]

Both
    parties agree that the threshold for leave in this context is not a high one.
    It is designed to protect the receiver against frivolous or vexatious actions
    or actions without basis in fact. The party seeking leave must only show a
    reasonable cause of action with some evidentiary basis, or in other words, the
    evidence must disclose a
prima facie
case: see
GMAC Commercial
    Credit Corp. - Canada v. TCT Logistics Inc.
, 2006 SCC 35, [2006] 2 S.C.R.
    123, at para. 59.

[30]

The
    appellant submits that the motions judge effectively determined the question of
    whether Schonfeld was grossly negligent  a factual issue for trial rather
    than asking whether a
prima facie
case of possible negligent conduct
    was established.

[31]

The
    liability of the Monitor and Receiver in this case was limited by the various
    orders to gross negligence or wilful misconduct. Accordingly, the analysis as
    to whether there is a factual foundation for a claim does not relate to mere
    negligence. In such circumstances, the test is whether the Receiver
    demonstrated a very marked departure from the standards by which responsible
    and competent people in such circumstances would have acted or conducted
    themselves, or in a manner such that it knew what it was doing was wrong or was
    recklessly indifferent in its conduct:
Alberta Treasury Branches v.
    Elaborate Homes Ltd.
, 2014 ABQB 350, 590 A.R. 156, at para. 39. The motions
    judge applied this test, and I agree that this is the proper test.

(d)

Did the motions judge err in concluding that the appellants Holmes and
    Flynn had not met the test for leave?

[32]

The
    appellants submit that even if the motions judge applied the correct test, he
    erred in concluding that the evidence did not establish conduct that
    constitutes gross negligence or wilful misconduct. They submit that Schonfelds
    admission that it was uninterested in the tax consequences of its conduct is
    evidence that meets the test.

[33]

Based
    on the motions judges findings of fact, which I have upheld, he did not err in
    concluding that there was no foundation for a claim in gross negligence or
    wilful misconduct.

[34]

The
    appellants further submit that the motions judge was wrong to rely only on the
    Receiver Order to determine Schonfelds mandate. Schonfeld, they submit, had an
    overarching duty of care in the management of the Monitored Parties assets.

[35]

In
    relation to this latter submission, I note that the Discharge Order contains a release
    of any and all liability relating to matters raised or which could have been
    raised within the proceedings; any liability not amounting to gross negligence
    or wilful misconduct falls within the scope of this release, even if the nature
    of the claim was not known at the time of discharge. The motions judge
    correctly noted that a more stringent standard for the granting of leave  a
strong

prima facie
case  may be appropriate in
    cases where the issues raised in the action could have been raised in the
    discharge proceedings: see
Bank of America Canada v. Willann Investments
    Ltd.
(1993), 23 C.B.R. (3d) 98 (Ont. Gen. Div.), at para 9;
Gallo v.
    Beber
(1998), 116 O.A.C. 340 (C.A.), at para. 7.

[36]

The
    motions judge noted, at para. 23 of his reasons, that the tax planning issues
    raised by Holmes and Flynn could have been raised in the discharge proceedings.
    I agree. Schonfelds conduct was approved of by the court and Schonfeld was
    ultimately discharged, all pursuant to motions served upon Holmes and Flynn. Nevertheless,
    I would agree with the motions judges conclusion that regardless of whether
    the regular standard described in
GMAC
or the stricter standard
    described in
Gallo
is applied, Holmes and Flynn have failed to
    establish a
prima facie
case of gross negligence or wilful misconduct.
    Accordingly, the motions judge did not err in concluding that Holmes and Flynn
    should not be granted leave to commence their action against Schonfeld.

(2)

BNGs Appeal (C60744)

[37]

As
    in Holmes and Flynns appeal, the motions judges refusal to grant BNG leave to
    bring a crossclaim or third party claim against Schonfeld is a discretionary
    decision, and this court will only intervene where there is misdirection, the
    decision is so clearly wrong that an injustice is occasioned, or where no or
    insufficient weight is given to relevant considerations.

[38]

BNG
    sought leave to commence a crossclaim and counterclaim or a third party claim
    against Schonfeld for contribution and indemnity. Its position was that the
    appellants Holmes and Flynn had not suffered any damages. In the alternative,
    if they had, BNG pleaded that: the damages were premature, excessive, remote
    and unrecoverable in law, and Holmes and Flynn had not mitigated their losses.
    BNG further pleaded that any damages were caused either by the negligence of
    Holmes and Flynn themselves, or by the actions, inactions and gross negligence
    of Schonfeld, given that Schonfeld knew of the outstanding shareholder loans
    and failed to require Holmes and Flynn to arrange repayment and/or to ensure
    that sufficient funds were set aside for such tax liability arising from the
    consequences of failing to repay such shareholder loans. Further, BNG alleged
    that Schonfeld failed to take reasonable steps to pursue appropriate strategies
    to eliminate or minimize potential tax liability and to manage the assets and
    undertakings of Holmes and Flynn in a manner that would eliminate or minimize
    tax liability.

[39]

The
    motions judge dismissed BNGs application for leave, at para. 33 of his
    reasons, by simply saying, In law, BNG cannot be in a better position than
    Holmes and Flynn to pursue its action against Schonfeld. Thus, for the reasons
    set out above, BNGs motion requesting leave to file a crossclaim or in the
    alternative a third party claim is similarly dismissed.

[40]

BNG
    raises several grounds of appeal, including that the motions judge erred by
    applying the strong
prima facie
case standard to BNG. At the outset, I
    note that the motions judge did not explicitly state that the strong
prima
    facie
case standard should be applied to BNG. He stated that he was
    dismissing BNGs application for leave for the reasons he had stated above. In
    my view, the same reasons apply to Holmes and Flynns proposed claim and BNGs
    proposed crossclaim because there is only one negligence claim, not two, as I will
    explain below.

[41]

As
    I have noted, the motions judge observed that the strong
prima facie
case standard may be appropriate where the issues raised in the action could
    have been raised in the discharge proceedings, and concluded that the reasonableness
    of Schonfelds conduct from a tax planning perspective and the potential tax
    liability of Holmes and Flynn were issues that could have been raised in the
    discharge proceedings.

[42]

On
    appeal, BNG points out that it was not a party to the Discharge Motion and had
    no notice of it, and as such had no legal standing or basis to raise its
    concerns at the Discharge Motion.

[43]

BNG
    further submits it seeks leave to sue Schonfeld on different grounds than
    Holmes and Flynn. The essence of BNGs claim is not that Schonfeld should have
    provided tax planning advice to the Monitored Parties. BNG submits that Schonfeld
    failed to make any effort to collect the shareholder loans which were an asset
    of the Monitored Parties. As a result, the loans were deemed to be income of
    Holmes and Flynn pursuant to s. 15 of the
Income Tax Act
. Thus, BNG
    argues, the conduct at issue was not the same as on the Discharge Motion. The
    motions judge failed to consider case law before him that highlights a
    receivers duty to take steps to pay tax as it becomes due and to minimize tax
    liability. Here, Schonfeld allowed the estates tax liability to surpass its
    remaining assets. The motions judge ignored the $1,700,000 in fees and
    disbursements billed by Schonfeld and removed from the estate.

[44]

Schonfelds
    position is that while BNG was not served with the motion records seeking
    approval of Schonfelds conduct, the same principle should apply. Both the Receiver
    Order appointing Schonfeld as well as the Discharge Order provide that Schonfeld
    can only be sued for gross negligence or wilful misconduct. Court approval
    would have little value if it only offered protection from claims brought by
    served parties. It submits that the conduct at issue was before the court even
    if BNG was not. BNGs pleadings rely on the pleadings made by Holmes and Flynn.
    Schonfeld is an officer of the court. As such, the protections given to
    Schonfeld by the court apply to anyone seeking to sue Schonfeld.

[45]

It
    is important to clarify the nature of BNGs involvement in the action.

[46]

BNG
    is a third party to the receivership and was not present at the discharge
    hearing. Nonetheless, in my view, it is barred from instituting proceedings in
    negligence by the release clause of the discharge order. The release clause
    allows the court to protect the discharged receiver, a former court officer,
    from claims arising out of the exercise of its role:
Ed Mirvish Enterprises
    Ltd. v. Stinson Hospitality Inc.
, 2009 CanLII 55113 (Ont. S.C.), at para.
    14,
per
Pepall J.

[47]

The
    release clause also allows the receiver to distribute funds upon discharge
    without the need to hold back funds in case of potential liability: see
Ogopogo
    Beach Resort Ltd. v. Happy Valley Resort Ltd.
, 2010 BCSC 996 (CanLII), at
    para. 37. The wording of the release clause in the present case, using the
    language of the Superior Courts model order, was broad enough to insulate
    against third party claims, as it was in the similar order in
Ogopogo Beach
    Resort
, at para. 40. The former receiver is not insulated against claims
    for gross negligence and wilful misconduct, but these can only be brought with
    leave of the court: see
Ed Mirvish Enterprises
, at para. 14. This
    rationale applies equally to would-be claimants who are parties and also to third
    parties.

[48]

BNG,
    however, did not actually plead a free-standing negligence or gross negligence
    claim against Schonfeld. It did not plead that Schonfeld owed it a duty of care
    in tort. BNGs pleadings only seek contribution and indemnity from its
    co-defendant Schonfeld, in the event that BNG is found to be liable to Holmes
    and Flynn. The closest BNG comes to suggesting that Schonfeld was negligent in
    its conduct towards BNG is when it points out, in its factum at para. 43, that
    Schonfeld did not consult BNG before making any financial decisions about the
    Monitored Parties. Absent a pleading by BNG that Schonfeld, as Receiver, owed
    BNG a legal duty to consult it, however, the evidence of a lack of consultation
    cannot establish a cause of action in negligence, let alone gross negligence.

[49]

Ultimately,
    BNGs arguments on this appeal benefit Holmes and Flynn by raising additional
    allegations of negligent conduct on the part of Schonfeld in its capacity as
    Monitor and Receiver. Unfortunately for BNG, while the allegedly negligent
    conduct it raises may be different than the allegations of negligence pleaded
    by Holmes and Flynn, all of this conduct could have, and should have, been
    raised by Holmes and Flynn during the course of the discharge proceedings.

[50]

The
    motions judges conclusion that, BNG cannot be in a better position than
    Holmes and Flynn to pursue its action against Schonfeld simply captured the
    reality that, given that BNG did not assert a free-standing negligence claim
    against Schonfeld but instead a crossclaim seeking contribution and indemnity, BNGs
    ability to claim against Schonfeld is dependent on Holmes and Flynns ability
    to claim against Schonfeld. Put another way, BNG cannot do indirectly  hold
    Schonfeld responsible for Holmes and Flynns losses  what Holmes and Flynn
    cannot do directly. Given the motion judges conclusion that Holmes and Flynn had
    not made out a
prima facie
case, and so accordingly should not be
    granted leave
nunc pro tunc
, this was sufficient to also dispose of
    BNGs claim. I agree with that conclusion, and would dismiss BNGs appeal.

F.

Disposition

[51]

For
    the reasons above, I would dismiss both appeals.

[52]

As
    the successful party, Schonfeld is entitled to its costs of the appeal. I would
    award Schonfeld $30,000, inclusive of disbursements and taxes, on a partial indemnity
    basis, and make Holmes, Flynn and BNG jointly and severally liable for this
    amount.

Released: HSL February 24, 2016

Karen M. Weiler
    J.A.

I agree H.S. LaForme
    J.A.

I agree Grant
    Huscroft J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Hudson's Bay Company v. OMERS
    Realty Corporation, 2016 ONCA 113

DATE: 20160210

DOCKET: C60988

Gillese, MacFarland and van Rensburg JJ.A.

BETWEEN

Hudsons Bay Company and HBC CAN Real Property LP

Applicants (Respondents)

and

OMERS Realty Corporation, Yorkdale Shopping
    Centre Holdings Inc., OMERS Realty Holdings (Yorkdale) Inc., ARI YKD GP Inc.,
    ARI YKD Investments LP, Square One Property Corporation, OMERS Realty
    Management Corporation, 156 Square One Limited, Scarborough Town Centre
    Holdings Inc., OMERS Realty Holdings (STC One) Inc., ARI STC GP Inc. and ARI
    STC Investments LP

Respondents (Appellants)

Sheila Block and Molly Reynolds, for the appellants

Jonathan Lisus and James Renihan, for the respondents

Heard: January 21, 2016

On appeal from the judgment of Justice Barbara A. Conway
    of the Superior Court of Justice, dated August 4, 2015, with reasons reported
    at 2015 ONSC 4671.

By the Court
:

BACKGROUND IN BRIEF

[1]

HBC CAN Real Property LP (HBC CAN LP) is a limited partnership whose
    sole limited partner is Hudsons Bay Company (HBC) and whose sole general
    partner is HBC CAN Real Property Inc. (HBC CAN Inc.). HBC CAN Inc. is wholly
    owned by HBC.

[2]

HBC and HBC CAN Inc. are anchor tenants in three shopping malls:
    Yorkdale, Square One, and Scarborough Town Centre. They operate Hudsons Bay stores
    at each of these three leased locations.

[3]

The malls are owned and operated by the appellant landlords (the
    Landlords), represented in this matter by Oxford Properties Group (Oxford).
    HBC is the tenant under the Yorkdale lease. HBC CAN Inc., as general partner of
    HBC CAN LP, is the tenant under the Square One and Scarborough Town Centre
    leases. HBC and HBC CAN LP are the respondents (Respondents) in this appeal.

[4]

HBC and RioCan Real Estate Investment Trust (RioCan) are entering into
    a real estate joint venture. HBC is to transfer ten real estate properties
    five owned and five leased  to the joint venture. The five leases include its
    leases at Yorkdale, Square One, and Scarborough Town Centre (the Leases). RioCan
    is to contribute a 50% co-ownership interest in Georgian Mall and Oakville
    Place, as well as cash.  Originally, the plan was that all of the real estate
    assets of the joint venture would be transferred to a limited partnership, the
    general partner of which would be a corporation jointly controlled by HBC and
    RioCan.

[5]

HBC sought Oxfords consent to assign and sublease the Leases for the
    purposes of the joint venture (while not conceding that consent was required). Oxford
    expressed concern about the degree of control that RioCan  one of its main
    competitors  would have over the Leases.

[6]

After various meetings between the parties, a revised joint venture was
    proposed. According to the Respondents, the changes were made to address
    Oxfords concerns. The revised joint venture structure would consist of two
    limited partnerships, with the second being formed specifically to hold the
    Leases. The structure would be as follows:

·

Limited Partnership #1: RioCan-HBC LP

o

There
    would be two limited partners: HBC and RioCan. HBC would initially hold
    approximately 90% of the partnership units and RioCan would hold the remaining
    approximately 10%;

o

The
    sole general partner would be 2455034 Ontario Inc. (245), a company jointly
    controlled by HBC and RioCan;

o

All
    of the assets to be contributed to the joint venture, other than the Leases, would
    be transferred to 245 (as the general partner) and, thus, be jointly controlled
    by HBC and RioCan.

·

Limited Partnership #2: HBC YSS LP

o

There
    would be a sole limited partner, RioCan-HBC LP, which would hold approximately 99.9999%
    of the partnership units;
[1]

o

The
    sole general partner would be HBC;

o

The
    Respondents would assign the Leases to HBC in its capacity as the general
    partner of HBC YSS LP. The leased premises would then be sublet to HBC on a
    full pass through basis for the entire remaining terms of each lease,
    including renewals.
[2]

[7]

The Respondents hoped that the revised structure would address Oxfords
    concerns because the Leases would be assigned to HBC, in its capacity as
    general partner of HBC YSS LP, rather than to 245, a company jointly controlled
    by HBC and RioCan.

[8]

When Oxford refused to consent, the Respondents brought an application under
    s. 23(2) of the
Commercial Tenancies Act
, R.S.O. 1990, c. L.7, for a
    declaration that the Landlords consents were not required for assignment and
    sublease of the Leases or, alternatively, that the Landlords were unreasonably
    withholding their consent to such assignments and subleases.

[9]

The application judge found in favour of the Respondents. She noted that
    the Leases contain provisions that restrict their transfer or assignment. However,
    each of the Leases also contains an exception for an assignment to an affiliate
    of the existing tenant (the affiliate exception). She concluded that because
    the Leases will be assigned to HBC, as general partner of HBC YSS LP, the
    assignments fall within the affiliate exception. She also concluded that because
    the subsequent subleases will be to HBC, which is the same entity as the
    general partner (HBC), the subleases are permitted under the affiliate
    exception.   Therefore, the application judge found, no consent to the
    assignments and subleases is necessary.

[10]

The
    application judge then considered whether, if consent to the assignments were
    required, the Landlords had unreasonably withheld their consent. She found that
    the Landlords were entitled to withhold their consent under the Square One
    lease, which provides that consent to an assignment may be arbitrarily
    withheld. With respect to the Yorkdale and Scarborough Town Centre leases,
    however, the application judge found that HBC had met its burden of proving
    that the Landlords were acting unreasonably in withholding their consent. She
    explained that because HBC would continue to be the operator of the stores and
    liable under the Leases, there was no reason to believe HBCs interests would diverge
    from those of Oxford, going forward.

[11]

Oxford
    appeals.

THE ISSUES

[12]

Oxford
    submits that the application judge erred by:

1.

holding that the assignment to a limited partnership through its
    general partner is an assignment to an affiliated company or corporation and
    therefore exempt from the consent requirement;

2.

finding, in the alternative, that the Yorkdale and Scarborough Town Centre
    leases require the Landlords to exercise their consent rights reasonably; and

3.

ignoring uncontested evidence and applying the wrong legal test to the
    evidence regarding the Landlords reasons for withholding consent.

ANALYSIS

ISSUE #1: Assignment to an Affiliate

[13]

Oxfords
    major complaint in this appeal is that the application judge failed to
    appreciate that the assignments of the Leases would result in the limited
    partnership (HBC YSS LP) having beneficial and effective ownership of the
    Leases. As the sole limited partner is RioCan-HBC LP, and referring to the
    joint venture agreement, Oxford says that the assignments will result in RioCan
    (its competitor), having decision-making power over certain significant actions
    that might be taken in connection with the Leases.

[14]

We
    do not accept Oxfords characterization of the effect of the assignments.  This
    is not a case, as Oxford suggested, of HBC holding bare title or being a mere
    nominee for the true beneficial owner.  Furthermore, contrary to Oxfords
    formulation of the first issue, the application judge did not hold that an
    assignment to a limited partnership through its general partner was an
    assignment to an affiliate.  Rather, she concluded that the proposed
    assignments of the Leases would be to the general partner and not to the
    limited partnership.  As such, what Oxford characterizes as the beneficial or
    effective ownership of the Leases cannot direct the analysis.

[15]

In
    our view, the application judge correctly concluded that, based on the unique
    legal nature of the limited partnership structure and the role played by the
    general partner, the Leases will be assigned to HBC, as general partner.

[16]

The
    application judges reasoning, which we adopt, can be summarized as follows.

[17]

A
    limited partnership is not a legal entity. It is required by law to have a
    general partner through which it normally acts:
Kucor Construction &
    Developments & Associates v. Canada Life Assurance Co.
(1998)
, 41 O.R. (3d) 577,
1998 CanLII 4236
(C.A.). A limited partnership cannot hold
    title to real property. It can hold title to real property only through its
    general partner.

[18]

Based
    on the description of limited partnerships given in
Lehndorff General
    Partner Ltd., Re
(1993), 17 C.B.R. (3d) 24 (Ont. Gen. Div.), at paras. 17
    and 20, which this court quoted with approval in
Kucor
, the application
    judge drew three conclusions.

[19]

First,
    any property in which a limited partnership has an interest can be held only by
    the general partner. In the case of a lease, there can be no assignment of the
    lease to the limited partnership  it must be assigned to the general partner.

[20]

Second,
    it is not simply a matter of the general partner acquiring legal title to the
    property. The general partner has control over the property and is solely
    responsible for the operations of the limited partnership. The limited partner,
    as a passive investor, is restricted from taking part in the control or
    management of the business. To do otherwise would jeopardise its limited
    partner status.

[21]

Third,
    from the perspective of the other contracting party, the general partner is
    solely liable for all payments under the contract and performance of all
    obligations thereunder. The limited partners have no such liability. In this
    case, once the Leases are assigned, the legal relationship will continue to be
    between the Landlords and HBC. There will be no relationship between the Landlords
    and the limited partner. HBC alone will be liable for rents and all amounts
    owing under the Leases. HBC alone will be responsible for compliance with all
    obligations and covenants under the Leases. Thus, there will be no change in
    the legal relationship between HBC and the Landlords following the assignments.

[22]

For
    these reasons, the application judge stated, in determining who will be the
    assignee of the Leases, there is no reason to look beyond the fact that the Leases
    are being assigned to the general partner. HBC as the general partner is the
    assignee, the affiliate exception applies and consent is not required. Because
    the subsequent subleases are to HBC, which is the same entity as the general
    partner, the subleases are also permitted under the affiliate exception.

[23]

We
    see no basis for interfering with the application judges determination that,
    in light of the affiliate exception, the Respondents did not need consent to
    assign the Leases to HBC as general partner of the limited partnership. HBC is assigning
    the Leases to itself in its capacity as general partner of HBC YSS LP.

[24]

Accordingly,
    this ground of appeal is dismissed.

ISSUES #2 and #3: Withholding Consent and Reasons Therefore

[25]

In
    light of our conclusion on the first issue, it is unnecessary to address these
    grounds of appeal.

DISPOSITION

[26]

For
    these reasons, the appeal is dismissed. No order is made as to costs as the
    parties have resolved that matter between themselves.

Released: February 10, 2016 (E.E.G.)

E.E. Gillese
    J.A.

J. MacFarland J.A.

K. van Rensburg J.A.

[1]
This permits the economic benefits of the Leases to flow up to HBC and RioCan.

[2]
The sublease rents will be higher than the rents under the Leases, which
    generates the economic benefits to flow to RioCan-HBC LP as limited partner of
    HBC YSS LP.


COURT OF APPEAL FOR ONTARIO

CITATION: Jaeger (Re), 2016 ONCA 111

DATE: 20160205

DOCKET: C60571

Gillese, Watt and Tulloch JJ.A.

IN THE MATTER OF:  CHRISTOPHER JAEGER

AN APPEAL UNDER PART XX.1 OF THE
CODE

Jill Presser and Jeff Marshman, for the appellant

Michael Fawcett, for the Crown

Janice Blackburn, for the Person in Charge of Waypoint
    Centre for Mental Health Care

Heard: February 5, 2016

On appeal against the disposition of the Ontario Review
    Board dated, May 11, 2015.

APPEAL BOOK ENDORSEMENT

[1]

The appellant appeals the ORB disposition on the basis that:

(1)

the Board failed to address the treatment impasse apparent on the
    record; and

(2)

the Board erred in admitting into evidence an email from the Hospital.

[2]

We accept neither submission.

Alleged Treatment Impasse

[3]

At the hearing, everyone agreed that the appellant remains a significant
    threat to public safety and his continued detention at the provincial maximum
    secure forensic facility remains appropriate. The only question was whether his
    next annual review should be expedited to occur six months early.

[4]

There is no evidence on the record to suggest a treatment impasse. It is
    telling that no one suggested at the hearing that there was an impasse.
    Furthermore, there was clear evidence that Mr. Jaeger has made progress in the
    past.

Hearsay Evidence

[5]

The Board has a wide latitude to accept hearsay evidence:
Ranieri
    (Re)
, 2015 ONCA 444, at para. 16. The email was provided to ensure that
    the record was complete and accurate. Counsel for the appellant was invited to
    review it prior to its admission. And, in any event, the email was of little
    relevance.

DISPOSITION

[6]

The appeal is dismissed.


COURT OF APPEAL FOR ONTARIO

CITATION: Klem (Re), 2016 ONCA 119

DATE: 20160212

DOCKET: C60756

Watt, Lauwers and Hourigan JJ.A.

IN THE MATTER OF: ALEX (ALEK) KLEM

AN APPEAL UNDER PART XX.1 OF THE
CODE

Suzan E. Fraser and Sarah Harland-Logan, for the
    appellant

Dena Bonnet, for the respondent, Attorney General

Heard: January 25, 2016

On appeal against the disposition of the Ontario Review
    Board dated, May 15, 2015.

Lauwers J.A.:

[1]

This is an appeal from a disposition in which the Ontario Review Board
    did not follow the recommendations in submissions put forward by the parties
    that are said to be joint submissions.

[2]

The appeal raises three issues. The first is whether the hearing before
    the Board proceeded on the basis that there was a joint submission. The second,
    in the wake of this courts decision in
Re Osawe
, 2015 ONCA 280, is
    whether Board gave the parties adequate notice of its intention not to accept
    the joint submission.
[1]
The third is whether the Board erred in law in receiving into evidence
    unredacted victim impact statements that contained inadmissible material not
    authorized under s. 672.5(14) of the

Criminal Code
, R.S.C. 1985,
    c. C-46
?

[3]

For the reasons that follow, I conclude: the hearing did not proceed on
    the basis of a true joint submission; the Board gave adequate notice to the
    parties that it had concerns with the proposed disposition in any event; the
    Board made no reviewable error in admitting the victim impact statements; and the
    Boards disposition was reasonable and fully supported by the record. Accordingly,
    I would dismiss the appeal.

The Factual Context

[4]

The facts are not in dispute. The appellant is a 71-year-old married man
    with two children. He lived and worked in Sudbury. Before the index offences in
    early October 2010, the appellant had no history of criminal activity,
    psychiatric disorder or drug abuse.

[5]

The appellants diagnosis is Psychotic Disorder, due to general medical condition,
    with delusions currently in remission; hypertension and widespread arteriopathy
    of aorta, cerebral, vertebral and renal arteries.

[6]

As a result of this disorder, the appellant had paranoid delusions and
    experienced an episode of prolonged psychosis.

He unsuccessfully sought medical help as his disease
    progressed.

At the time
    of the index offences, he believed his former employer conspired with a number
    of people, including the man whom he shot and one of the employees at the shop
    that he sought to enter, to kill the appellant.

[7]

The appellant was charged with attempting to commit murders while using
    firearm; uttering a threat to cause death or bodily harm; engaging in threatening
    conduct to person or family members (x 4); breaking and entering with intent; resisting
    or obstructing public or peace officer; possession of a firearm in a motor vehicle
    (x 2); possession of weapon for dangerous purpose; and robbery using a firearm,
    all contrary to the
Criminal Code
.

[8]

On June 14, 2013, the appellant was found Not Criminally Responsible
    (NCR) on account of mental disorder. The court referred him to the Ontario
    Review Board for disposition.

The Ontario Review Boards Dispositions

[9]

The Boards initial disposition, on September 9, 2013, required
    the appellant to be detained in the general forensic unit of the North Bay
    Regional Health Centre with accompanied community privileges. At the first
    annual review hearing, following a joint submission, by disposition dated
    August 27, 2014, the Board ordered the appellant to be transferred from North
    Bay, to Ontario Shores Centre for Mental Health Sciences in Whitby (the Hospital),
    since a treatment impasse appeared to have been reached in North Bay.

The Disposition under Appeal

[10]

The
    Board convened an early hearing at the request of the Hospital to review the
    appellants disposition, as provided in s. 672.81(2) of the
Criminal Code
,
    because the treatment team felt that Mr. Klems disposition was too
    restrictive and he was at the ceiling of his privileges.

[11]

The
    Hospital and the appellant presented a joint submission as to the appropriate
    disposition. The appellant did not testify. The parties agreed that there
    should be a continuation of the detention order,

and that the following changes should be made to its
    terms:

(a) The Appellants hospital and grounds privileges be extended
    to permit him to access these locations with indirect supervision (as opposed
    to in the presence of a staff member or approved person only);

(b) The Appellant be granted the additional privilege of
    attending within 150 kilometres of Ontario Shores, with a staff member, an
    approved person, or indirectly supervised;

(c) The Appellant be permitted to reside in approved
    accommodation in the community of Whitby; and

(d) The term preventing the Appellant from attending within the
    District of Sudbury be varied to permit him to do so with the consent and prior
    itinerary approval of the person in charge of Ontario Shores (so as to permit
    him to attend the funeral of any member of his wifes family who lives in
    Sudbury, should the need arise).

[12]

Crown
    counsel initially refrained from taking a position on proposed changes (a)
    through (c). On hearing the evidence, Crown counsel adopted the joint position
    of the Hospital and the appellant.

[13]

The
    Board rejected the proposed disposition that the appellant be permitted to live
    in the community in approved accommodation, and that he be permitted to attend
    within 150 kilometres of Ontario Shores. It ordered that the appellants
    hospital, grounds, and community privileges be extended to permit indirect
    supervision, and that he be permitted, with the consent of the person in charge
    of the Hospital, to attend within the District of Sudbury.

[14]

The
    record shows the appellant had been uncooperative and dismissive with little
    insight during his time in North Bay, where the Boards earlier disposition
    noted a treatment impasse, but that he has made progress since coming to the
    Hospital. His wife, who only recently became an approved person, is now
    engaged in the appellants treatment and is better able to monitor him.

[15]

The
    Board fairly and accurately set out the evidence that it heard from the sole
    witness, Dr. Pytyck, who has been the appellants attending in-patient
    psychiatrist at the Hospital since his transfer in August 2014.

[16]

The
    Board did not accept Dr. Pytycks recommended disposition. The Board stated
    that it believes that public safety would be compromised with a term
    permitting community living at any time over the next 12 months. This view was
    based on the appellants relatively short stay at the Hospital.

[17]

In
    my view, the nub of the Boards concern is reflected in its acknowledgement
    that even Dr. Pytyck thought some delay was warranted:

Dr.

Pytyck

in

her

evidence

fairly

put

it

that

even

with

a community living clause the hospital

wouldnt place Mr.

Klem

in

the

community

until

approximately

nine

months

from

the

issuance of

the

Disposition. This

panel

is

not

prepared

to

give

the

Hospital

the

discretion

to

do

so

at

any point

over

the

next

12

months.
In

this

panel's

opinion

the

issue

of

community

living

should

be
canvassed

at

the

next

annual

review.

[18]

Earlier
    in its reasons, the Board noted the evidence of the unpredictability of future
    episodes:

In  response  to
    questions  from  a  member  of  the  panel,  Dr.  Pytyck agreed that the underlying
    problem is vascular. The rate of any future vascular difficulties is unknown.
    Dr. Pytyck put it that the team is "cautiously optimistic" that the
    team would be able to pick up on any signs of vascular difficulty.

·

Dr. Pytyck also agreed that it is "likely" that the
    vascular difficulties are irreversible.

[19]

The
    Board concluded more time was needed to assess the appellants capacity for
    reintegration into society:

In the Boards opinion public safety requires a significant
    period of time in which Mr. Klem demonstrates his ability to safely use
    indirectly supervised passes. We do not think it appropriate that indirectly
    supervised community passes be extended to 150 kilometres from Ontario Shores.
    In the Boards opinion those passes should be limited to Whitby and Oshawa, and
    up to 12 hours. []

We have concluded that the potential risk of very significant
    harm is such that public safety would be compromised with a community living
    clause at this time.

[20]

The
    Board pointed out, however:

Our

Disposition

shall

continue

the

privilege

of

entering

the

community

of

Whitby accompanied

by

staff

or

person

approved

by

the

person

in

charge

for

up

to

48

hours.

This

will permit

the

hospital

to

continue

to

grant

those passes as

they

have been

doing

recently.

[21]

The
    appellants ability to stay overnight on occasion with his wife in her Whitby
    apartment was maintained.

The Positions
    of the Parties

[22]

The
    appellant submits the Board erred in law in departing from the joint submission
    and setting a more restrictive disposition; in particular, the Board had a
    duty to give notice that it did not accept the joint submission, and to provide
    an opportunity for the appellant to lead further evidence and make further
    submissions. The appellant also argues that the unredacted victim impact
    statements, which contained inadmissible prejudicial material, appear to have
    influenced the Board to reject the joint submission. The result, the appellant
    asserts, was an unreasonable disposition.

[23]

The
    respondent Crown submits there was no true joint submission in this case and
    the hearing did not proceed as though there were one. The Board was entitled to
    reject the proposed disposition and did so for reasons amply supported by the
    record.  The Board had discretion to accept the victim impact statements and
    to disregard the improper portions. There is no basis for finding the
    disposition was unreasonable or resulted in a miscarriage of justice.

Issue One: Was
    a joint submission before the Board?

[24]

If
    a joint submission were before the Board, then its obligations under this
    courts decision in
Osawe
came into effect. The appellant argues that
    even though the Crown reserved on whether to support the proposed disposition
    at the outset of the hearing, the Crowns support of it during argument made it
    the functional equivalent of a joint submission.

[25]

I
    disagree. There were a number of contextual factors in this case that made it
    clear to the Board and to the parties that some issues were contested.

[26]

First,
    the hearing context was somewhat unusual in that, apart from the immediate
    parties, three victims were present in the hearing room and one was present via
    videoconferencing, each of whom requested the opportunity to read their victim
    impact statements. They uniformly opposed the extension of privileges. In
    addition, a member of the media was present. It was not likely that the Board
    would simply accept a number of contested privileges.

[27]

Second,
    the Board saw its task as working from its prior disposition. The Board Chair
    noted that: What we are doing today is dealing with the request from the
    hospital to add three privileges. But that prior disposition, only five months
    previous, found the appellant remains a significant threat. The Board needed
    evidence before departing from its prior understanding.

[28]

Third,
    the Crowns reservation was not merely formal or perfunctory. In fact, the
    Crown advised that it would be: seeking, by way of an additional condition, in
    order prohibiting Mr. Klem from entering the District of Sudbury, with some
    exceptions. This was specifically noted by the Chair before evidence was
    called, when he observed that Crown counsel: hasnt quite committed himself to
    any position which is fair and fine.

[29]

In
    the specific context of this hearing, it was clear from the outset that a
    number of issues were in contention and the hearing progressed on the basis
    that there was no joint submission. The appellant could not reasonably have
    expected that the Board would simply adopt the proposed disposition. I would
    not find that this hearing involved a joint submission that attracted the
    application of
Osawe
.

[30]

I
    now turn to the second issue, although it is not strictly necessary to analyse
    given the outcome of the first issue.

Issue Two: Did the Board give the
    parties adequate notice of its intention not to accept the joint submission?

[31]

On
    the assumption that there was a functional joint submission in this case, I
    begin by setting out the governing principles and then address their
    application.

The Governing Principles

[32]

As
    I noted in
Benjamin (Re)
, 2016 ONCA 118, this court has provided
    guidance to the Ontario Review Board about the adequacy of notice required to
    inform parties making a joint submission that it may not be accepted,
    particularly in
Osawe (Re)
, at para. 73. I will not repeat that
    discussion here. Further, in
Benjamin (Re)
I noted, at para. 23, the
    context of the matter and what occurred at the hearing can indicate the
    proposed disposition will not be easily accepted by the Board and must be amply
    demonstrated on the evidence.

The Principles Applied

[33]

I
    draw here on the review of the proceedings before the Board set out in the
    previous section of these reasons, which sets the context.

[34]

First,
    nothing in the Chairs statements or approach would have signalled the Boards
    acquiescence to the proposed disposition. During the cross-examination of Dr.
    Pytyck, the chair interjected: So that everyone understands and I have no idea
    if the Board is going to permit community living, but if the Board did permit
    and if Mr. Klem then took up residence in Whitby, how would the hospital follow
    him

[35]

Second,
    the Crowns cross-examination of Dr. Pytyck, and the cross examinations carried
    on by members of the Board were substantive and relatively lengthy. All five
    Board members asked Dr. Pytyck probing and pointed questions.

[36]

Dr.
    Braden asked Dr. Pytyck about the underlying vascular problems, which are
    likely progressive and irreversible. She responded that vascular disorders are
    unpredictable and could change, literally within an instant.

[37]

Dr.
    Pytyck accepted Dr. Chatterjees observation that vascular processes tend to
    have sort of step-wise and sudden deteriorations.  Dr. Pytyck said she was
    aware of the possibility that there could be an acute event and the onset of
    psychoses could be very rapid, but also indicated that with respect to the
    index offence, there was at least a year of events that did not involve any
    psychotic symptoms. There was then approximately one to two weeks of paranoia
    that preceded the index offences and it was in the context of a withdrawal of
    anti-hypertensives and Benzodiazepines.  She agreed that this was pretty
    rapid. Dr. Chatterjee asked questions about the release plan for the
    appellant to begin to reside in the community. She noted that, we dont have a
    huge period of stability.

[38]

Ms.
    MacIntyre asked Dr. Pytyck questions about the Klems family and/or friends.
    They have no roots in the Whitby community, and as Ms. MacIntyre stated, that
    leaves an awful lot on, on the shoulders of Mrs. Klem. The appellant was
    estranged from both of his children.  In response to a question from Justice
    McRae, Dr. Pytyck indicated that she felt that the appellant had a testy
    interpersonal style.

[39]

In
    my view, these questions by panel members sought to get at the heart of the
    security concerns that the Board had about extending the appellants
    privileges. It was fully open to the appellants counsel to have called the
    appellant and his wife to provide additional evidence, but that did not occur.

[40]

In
    my view, while the Chair did not state at the outset that the proposed
    disposition was in issue, the context of this hearing, together with the
    pointed questions asked by the Crown and the members of the panel, made it very
    clear that panel members were highly doubtful about the wisdom of the
    privileges proposed to be extended in the joint submission so shortly after the
    previous disposition. In my view the notice was adequate, procedurally fair and
    in compliance with
Osawe
.

[41]

The
    Board gave reasons for its disposition that were amply supported by the record.

Issue Three:
    Did the Board err in law by receiving into evidence four unredacted victim impact
    statements that contained inadmissible material?

[42]

The
    appellant submits that the Board erred in law by receiving into evidence four unredacted
    victim impact statements that contained material not permitted by s. 672.5(14) of
    the
Criminal Code
.
[2]
The Board declined to admit a proposed victim impact statement from the
    appellants daughter, noting that she did not fall within the definition of
    victim under the
Criminal Code
.

[43]

While,
    I agree that the victim impact statements contained impermissible material that
    was inflammatory in nature, the Boards acceptance of the unredacted statements
    into evidence did not taint its disposition.

The Governing Principles

[44]

The
Criminal Code
sets the boundaries of the admissible content of victim
    impact statements. At the time of the hearing, ss. 672
.
5(14)-(15) of

the
Criminal
    Code

provided:

672.5(14)

A

victim of

the offence may p
r
epare and
    file with the court or Review Board a written statement describing the harm
    done to, lo
s
s suffered by,

the victim arising from the comm
i
ssion of the offence.

672.5(15) The court or Review Board shall ensure that a copy of
    any statement filed in accordance with subsection (14) is provided to the
    accused or counsel for the accused, and the prosecutor, as soon as practicable
    after a verdict of not criminally responsible on account of mental disorder is
    rendered in respect of the offence.

[45]

Under
    these provisions, the Board was only permitted to allow as a victim impact
    statement a written statement describing the harm done to, or loss suffered
    by, the victim arising from the commission of the offence. In an ideal world,
    victims would complete their impact statements in full compliance with the
    requirements of the
Criminal Code
.
[3]

[46]

If
    the statements go beyond what which is admissible, a number of preliminary
    steps could be taken.

[47]

Those
    taking the statements from the victims could advise on how the statements would
    need to be revised to comply with the
Criminal Code
.

[48]

Counsel
    for the accused and the Crown could discuss redacting offending comments from
    the statements before they are tendered to the Board.

[49]

Further,
    it would be open to the parties to request the Board to rule on the
    admissibility of comments on which counsel could not agree. In such cases, the
    Board would hear submissions from the parties and decide whether to admit the
    statements in whole, with offending portions excised, or at all: see, e.g.
Ibrahim
    (Re)
, [2012] O.R.B.D. No. 1593, at para. 27;
Coles (Re)
, [2010]
    O.R.B.D. No. 941, at paras. 4-7;
Wallace (Re)
, [2008] O.R.B.D.
    No. 2164, at paras. 4-8.

[50]

The
    Board could also, on its own initiative, direct counsel to meet and attempt to
    come to an agreement on which portions of the victim impact statements should
    be redacted during a break in the hearing:
Kachkar (Re)
, [2014]
    O.R.B.D. No. 1356,

[51]

Lastly,
    it would be open to the Board to admit a victim impact statement in full, while
    taking into consideration only those parts of the statement that comply with
    the
Criminal Code
. The Board could identify its concerns with the
    statements and advise the parties that it will only consider the non-offending
    portions of the statement. This could be done on the Boards own motion, or in
    response to concerns or objections raised by counsel:
White (Re)
, [2012]
    O.R.B.D. No. 1641, at para. 11;
Agathos (Re)
, [2009] O.R.B.D. No.
    1157, at para. 2;
Laguta (Re)
, [2012] O.R.B.D. No. 2374, at para. 3.

The Principles Applied

[52]

The
    appellant submits, fairly, that the

victim
    impact

statements

admitted into evidence were replete with
    highly

prejudicial material that

falls outside of the permitted topics. The
    appellant asserts that the impermissible comments consist of: Unproven,
    prejudicial allegations
r
egarding
    the index offences (which are characterized

as

attempted

m
a
s
s

m
urder); and regarding the Appellan
t

s
    present character and dangerousness;

Irrelevant commentary on
    unrelated events and society at large; and Entreat
i
es to the
B
oard to
    restr
i
ct the Appellan
t

s
    freedom

(often in conjunction

with assertions of this

NCR

accu
s
e
d

s

m
or
a
l

bl
a
m
ewor
t
hiness).
    Without detailing the inadmissible comments, these are fair descriptions.

[53]

The
    impermissible comments in the victim impact statements reflect the understandable
    anger and animosity the victims feel, together with fear about the appellants
    true dangerousness, and suspicion about his true state of mind. They also
    reflect distress that the appellant may resume a more normal life considerably
    sooner than he would if he had been sentenced as a criminal and had not been
    found NCR. The appellant asserts that prejudice flows from the inflammatory
    nature of these comments and feelings, which could unduly influence the Board.

[54]

Although
    most of the content of the victim impact statements was permissible under the
Criminal
    Code
, some elements clearly fell outside of what is authorized and what
    the Board is allowed to consider. The Board did not ask the parties to agree on
    redactions, nor did it explicitly state that it would consider only those
    aspects of the statements admissible under the
Criminal Code
.

[55]

Although
    counsel for the appellant before the Board did not object to

the inclu
s
ion
    of

the statemen
t
s, he noted that
in one of the statements,
there
w
ere a few comments that

exceed
    what

is usually allowed. Crown coun
s
el agreed

that

some of

the content of

[the]

.

.

.

statements goes beyond the four corners
    of

whats permitted under the
Code
,
    however, Im confident, as Im sure the rest of the parties are that the Board
    will sift

the grain from the chaff

as it we
r
e
.
The issue of the admissibility of parts
    of the victim impact statements, however, was squarely before the Board.

[56]

The
    Board could have directed counsel immediately to work to redact the statements
    before proceeding, but was not obligated to do so. This would have introduced a
    delay into the hearing and could have put the Board in the difficult position
    of resolving disputes about the redactions in front of the victims themselves.
    Instead, the Board simply allowed the victims their say. Ultimately, the victim
    impact statements do not seem to have influenced the Boards decision. The sole
    reference to the victim impact statements in the Boards reasons was to fairly
    acknowledge that

the

events

of

the index

offence

have

a

significant

impact

on

the

lives

of

each

of

the

victims.
    This description of the Boards use of the statements conforms with what is
    permissible under s. 672.5(14) of the
Criminal Code
.

[57]

In
    my view the Board had discretion to proceed as it did. The Board can reasonably
    be expected to know the relevant law and take it into account. In
White
    (Re)
, the same presiding Chair as here pointed out that some portions of
    the victim impact statements in that case went beyond the four corners of the
Criminal
    Code
provisions and advised the panel would only consider the portions
    that complied with the
Criminal Code
. I note as well that four of five
    panel members here, including the presiding Chair, also sat on the Board

in
Kachkar (Re)
, where the Board requested counsel to meet during a break
    and attempt to agree on the redaction of offending portions of the victim
    impact statements in that case.

[58]

While
    it would have been preferable for the Board to tell the parties that it would
    only consider the admissible parts of the statements, or to direct the parties to
    redact the statements, I reject the appellants argument that the Boards
    failure to do so automatically renders the Boards decision unreasonable.

[59]

Clearly
    the Board, and especially the presiding Chair, were attuned to the issues
    surrounding the permitted use of portions of the victim impact statements. The
    issue was left to the Board, as Crown counsel noted, to separate the grain
    from the chaff and it was not necessary for the Board to explicitly state that
    it would do so. There is no evidence that the Board improperly relied on the
    inadmissible evidence. To the contrary, the Board increased the appellants
    privileges despite the urging of the victims not to do so. The Board did not
    commit a reviewable error by admitting the victim impact statements.

Disposition

[60]

To
    summarize, in the specific context of this hearing, the appellant could not
    reasonably have expected that the Board would simply adopt the proposed
    disposition. I would not find that this hearing involved a joint submission
    that attracted the application of
Osawe (Re)
.

[61]

Assuming,
    however, that the case is to be considered on the basis that it did
,
the
    context of this hearing together with the pointed questions asked by the Crown
    and the members of the panel made it very clear that they were highly doubtful
    about the wisdom of the joint submission so shortly after the previous
    disposition. In my view, the notice was adequate and procedurally fair in
    keeping with
Osawe
.

[62]

There
    is no reason to assume the Board did not simply disregard the non-compliant
    portions in its deliberations. The Board did not err in admitting the
    non-compliant portions of the victim impact statements.

[63]

Finally,
    the Board gave reasons for its disposition that were amply supported by the
    record.

[64]

I
    would dismiss the appeal.

Released: February 12, 2016 DW                                  Lauwers
    J.A.

I
    agree David Watt J.A.

I
    agree C.W. Hourigan J.A.

[1]

The reasons in
Osawe
were released on April
    22, 2015, the day after the Board hearing in this case. The Boards decision
    was released on May 22, 2015
.

[2]
Amendments to this section of the
Criminal Code
and Form 48.2 (Victim Impact Statement  Not Criminally Responsible) came
    into force after the hearing before the Board, and should reduce the risks of
    inappropriate comments being included in the statement.

[3]
I observe the relevant provisions have since been
    amended and now include the requirement that victim impact statements in this
    context adhere to Form 48.2 (Victim Impact

Statement

 Not Criminally
    Respon
s
ible), which provides:

This form may be used to

provide a description of the p
h
ysical or emotional harm, proper
t
y

da
m
age

or
    economic lo
s
s suffered by

y
o
u arising from the conduct for

w
h
ich
    the
a
ccused person
w
as found not criminal
l
y

resp
o
nsible

on account of

mental disorder,
    as well as a description of the impact t
h
at
    the conduct has had on
y
o
u
. []

The Form specifies that

the Victim Impact

Statement
    may not

include, for example: any statement about the conduct of

t
he

accused that

is not relevant to the harm or loss suffered by you; any
    unproven allegation
s
;

[]

or
    except

with

the

courts

or

Review

Boards

approval,

an opinion

or recommendation about the dispositio
n.


COURT OF APPEAL FOR ONTARIO

CITATION: Kloos v. Tangas, 2016 ONCA 149

DATE: 20160224

DOCKET: C59757

Gillese, Hourigan and Brown JJ.A.

BETWEEN

Sara Kloos

Plaintiff (Respondent)

and

Gus Constantine Tangas and
Mary
    Dom

Defendants (
Appellant
)

Alfred Schorr, for the appellant

Constantine Alexiou and Ann Hatsios, for the respondent

Heard: February 22, 2016

On appeal from the order of Justice Frederick L. Myers of
    the Superior Court of Justice, dated November 21, 2014.

ENDORSEMENT

[1]

Mary Dom appeals from the order of Myers J.
    dated November 21, 2014 which dismissed her objection to the confirmation of
    the Report of Master McAfee dated October 31, 2013. The Report dealt with the
    priority between two mortgages granted by Doms son, the defendant, Gus Tangas,
    on his residential property: a May 2001 second mortgage for $90,000 granted to
    his mother, Dom (the Dom Mortgage), and an August 2003 mortgage for $142,000
    granted to the respondent, Sarah Kloos (the Kloos $142,000 Mortgage).  The
    Master held that the Dom Mortgage was a fraudulent conveyance and fraudulent
    preference and therefore was void.

[2]

Between 1999 and 2003, Tangas borrowed
    significant sums of money from Kloos. During that period, Tangas granted Kloos
    a series of mortgages on his residence: (i) a May 1999 second mortgage for
    $48,000 (the Kloos 1999 Mortgage); (ii) a June 2002 mortgage for $50,000; and
    (iii) the August 27, 2003 Kloos $142,000 Mortgage which consolidated his then
    outstanding debts to Kloos.

[3]

In April 2001, Tangas executed a promissory note
    in favour of his mother for $90,000.  One month later, on May 8, 2001, Tangas
    granted his mother a collateral mortgage on the residential property for
    $90,000. Tangas testified that he granted a mortgage to his mother in return
    for monies Dom had advanced to him over the years.

[4]

As result of the discharge of the Kloos 1999 Mortgage,
    the $50,000 and $142,000 mortgages Tangas subsequently granted to her stood in
    third place on title, subordinate to a first mortgage to a bank and the $90,000
    Dom Mortgage.

[5]

The Master found that Tangas did not make a
    single payment to Kloos on her loans to him from 2001 onward.

[6]

The Master found that the Dom Mortgage was a fraudulent
    conveyance and fraudulent preference and therefore was void.  Dom did not
    challenge those findings on her motion to oppose confirmation, nor does she
    challenge them on this appeal.

[7]

Dom advances two grounds of appeal.  First, Dom
    submits that the motion judge erred in upholding the Masters finding that
    Kloos was not estopped from raising the issue of the validity of the Dom
    Mortgage. Specifically, Dom argues that there was delay by Kloos in challenging
    the Dom Mortgage which amounted to acquiescence in its validity.  As well, the
    delay by Kloos prejudiced Doms ability to defend the validity of the Dom
    Mortgage.

[8]

Dom contends that when Kloos took mortgages from
    Tangas in 2002 and 2003, she knew those mortgages stood behind the Dom
    Mortgage. That knowledge, according to Dom, constituted acquiescence by Kloos
    in the validity of the second mortgage. In our view, that submission overlooks
    the more important issue of when Kloos first knew that no actual advances from
    Dom to Tangas underpinned the Dom Mortgage.  At the hearing of the appeal,
    counsel for Dom conceded that Kloos did not become aware of such facts until
    during the discovery process in her 2010 mortgage enforcement action.
    Accordingly, there is no merit in Doms argument that Klooss silence before
    discovering those facts could amount to acquiescence in a mortgage which was a
    fraudulent conveyance and preference.

[9]

We do not accept Doms submission that she
    suffered prejudice from the delay of Kloos in challenging the validity of the
    Dom Mortgage. Dom argues that by the time of the reference hearing, she was 89
    years old, infirm and unable to testify about the circumstances that gave rise
    to the Dom Mortgage. The Master held that there was no evidence that documents
    which might have evidenced advances of money from Dom to Tangas had existed or
    had been destroyed. Tangas acts as his mothers litigation guardian in this
    litigation, so it always has been open to him to locate banking records of the
    advances, if they existed. Moreover, Tangas testified that his family conducted
    their affairs on a cash basis, so it is unclear what documents Dom could have
    proffered.  Finally, the Master did not accept Tangass evidence that he had
    borrowed money from his mother, and we see no basis upon which to interfere
    with that finding of fact.

[10]

As her second ground of appeal, Dom argues that
    the motion judge erred in failing to find that Klooss delay in challenging the
    validity of the Dom Mortgage gave rise to laches. According to Dom, the silence
    of Kloos for six years on the validity of the Dom Mortgage constitutes delay
    which, in itself, can amount to laches, even in the absence of prejudice.

[11]

We disagree. At the hearing, appellants counsel
    acknowledged that the timing of events in this case brought them within the
    analytical framework regarding laches described by this court in
Perry,
    Farley & Onyschuk v. Outerbridge Management Ltd.
(2001), 54 O.R. (3d) 131 (Ont. C.A.). In
Perry
,
    at para. 36, this court stated: A party relying on the defence [of laches]
    must show a combination of delay and prejudice. Accordingly, delay, standing
    alone, could not give rise to laches.

[12]

The appeal is dismissed. The appellant shall pay
    the respondent her partial indemnity costs of the appeal in the amount of
    $11,000, inclusive of H.S.T. and disbursements.

E.E. Gillese J.A.

C.W.
    Hourigan J.A.

David
    Brown J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: M.M. v. de Souza, 2016 ONCA 155

DATE:  20160225

DOCKET: C60350

Simmons, LaForme and Huscroft JJ.A.

IN THE MATTER OF an application under subsection 32(1) of the
Health
    Care Consent Act
,
1996
, S.O. 1996, c. 2, Schedule A, as amended.

BETWEEN

M.M.

Appellant

and

Dr. Darina de Souza

Respondent

M.M., acting in person

Mercedes Perez, appearing as
amicus curiae

Paul J. Davis, for the respondent

Heard: December 7, 2015

On appeal from the order of Justice David G. Stinson of
    the Superior Court of Justice, dated April 10, 2015, with reasons reported at
    2015 ONSC 2362, dismissing an appeal from a decision of the Consent and
    Capacity Board, dated October 21, 2014, with reasons reported at 2014
    CarswellOnt 17250.

Huscroft J.A.:

[1]

The Consent and Capacity Board confirmed Dr. Darina de Souzas finding that
    the appellant was incapable of consenting to treatment for a mental disorder and
    confirmed her involuntary status. The appellant appealed the Boards finding of
    incapacity, but not her involuntary status. The Boards decision was upheld by
    the appeal judge and the appellant now appeals to this court.

[2]

I have concluded that the Boards decision concerning the capacity of
    the appellant to make treatment decisions is reasonable, as the appeal judge
    concluded.

[3]

Accordingly, I would dismiss the appeal for the reasons that follow.

Background

[4]

The appellant has been diagnosed with paranoid schizophrenia. She has
    been hospitalized several times as a result of her mental disorder prior to the
    admission at issue and has taken antipsychotic medication previously. She
    presented at the emergency room of her local hospital five times in the two
    months preceding the admission that triggered this proceeding.

[5]

On October 8, 2014, staff at the appellants dental office called police
    in response to her loud, profane, and aggressive behaviour. The police took the
    appellant to the hospital. Her treating psychiatrist, Dr. de Souza, found that she
    was incapable of consenting to treatment and incapable of managing her property
    and completed a Certificate of Involuntary Admission.

[6]

The appellant asked the Board to review Dr. de Souzas findings of
    incapacity as well as her committal to involuntary status.

Decision of the Board

[7]

The Board found that the appellant suffers from a mental disorder,
    paranoid schizophrenia. The Board found, further, that although she understands
    information concerning her diagnosis and treatment, the appellant is unable to
    apply this information to her circumstances. She lacks insight into her
    condition as a result of her disorder. The appellant considers she does not
    have a mental disorder and does not acknowledge that her behaviours are
    symptoms of a disorder that have affected her various relationships.

[8]

The Board rejected the appellants testimony about how she weighs a
    decision to accept or reject treatment and found that she is unable to weigh
    the benefits against the risks. Accordingly, the Board concluded that the
    appellant was incapable of consenting to treatment of a mental disorder.

[9]

The Board concluded that it was not established that the appellant was
    unable to understand the information relevant to, or to appreciate the
    consequences of, a decision or lack of decision concerning the management of her
    property. Accordingly, the Board found that the appellant was capable of
    managing her property.

[10]

Finally, the Board found that the appellants condition improved when
    she took medication and that the criteria for involuntary status in s. 20(1.1)
    of the
Mental Health Act
,

R.S.O. 1990, c. M.7, were satisfied.
    As a result, the Board confirmed the appellants involuntary status.

Decision of the Appeal Judge

[11]

The appeal judge held that the Board properly considered the appellants
    ability to appreciate, weigh, and apply information to her circumstances and
    that the Board correctly understood and applied the statutory test for
    incapacity. He held, further, that the evidence supported the Boards
    conclusion that the appellant lacks insight into her disorder; does not
    recognize that her behaviours are a symptom of that disorder; and is unable to
    appreciate that treatment will improve her behaviours. The appeal judge upheld
    the Boards decision that the appellant was incapable of consenting to
    treatment.

Analysis

The standard of review

[12]

The
decision of the Board applying the law to
    the evidence is subject to review on a standard of reasonableness:
Giecewicz
    v. Hastings
, 2007 ONCA 890, 288 D.L.R. (4th) 587, at para. 13, leave to
    appeal refused [2008] S.C.C.A. No. 97.

[13]

The respondent invited the court to revisit the standard of
    review for decisions of the Board on questions of law involving its home
    statute and related statutes, given developments since
Starson v. Swayze
,
    2003 SCC 32, [2003] 1 S.C.R. 722, including
Dunsmuir v. New Brunswick
,
    2008 SCC 9, [2008] 1 S.C.R. 190. It is not necessary to do so for purposes of
    this appeal.

Is the Boards decision concerning the appellants capacity
    to make treatment decisions about antipsychotic medication reasonable?

[14]

The
    test for capacity to make treatment-related decisions is set out in s. 4(1)
    of the
Health Care Consent Act, 1996
, S.O. 1996, c. 2, Sched. A
:

A person is capable with respect to a
    treatment, admission to a care facility or a personal assistance service if the
    person is able to understand the information that is relevant to making a
    decision about the treatment, admission or personal assistance service, as the
    case may be, and able to appreciate the reasonably foreseeable consequences of a
    decision or lack of decision.

[15]

In her testimony before the Board, Dr. de Souza conceded that the first
    part of the test was satisfied: the appellant is able to understand the
    information relevant to making decisions about her treatment. The question
    before the Board concerned the second part of the test  the appellants
    ability to appreciate the reasonably foreseeable consequences of a decision
    about being treated with antipsychotic and side effects medications.

[16]

Amicus
submits that there is a complete absence of factual
    foundation to establish the benefits to the appellant of taking antipsychotic
    medication. Further, the evidence before the Board demonstrated that the
    appellant had the ability to appreciate the reasonably foreseeable consequences
    of treatment with antipsychotic medication and that she refused to take antipsychotic
    medication because of its side effects.

[17]

I do not accept this submission.

[18]

First, it was not necessary for the Board to have testimony concerning
    the benefits or side effects of proposed treatment. The Board is tasked with
    making decisions on the question of capacity, not on the advisability of a
    proposed treatment regime from a medical perspective:
Giecewicz
, at para. 43
.

[19]

Second, although the appellant apprehended negative side effects from
    treatment with antipsychotic medication, it does not follow that she has the
    capacity to make the treatment decision concerning that medication. Dr. de
    Souza testified that the appellants insight into her disorder is impaired and
    that the appellant does not believe that she is suffering from a mental disorder.
    It is foreseeable that a decision to refuse antipsychotic treatment would
    result in intensification of delusions, thought disorder, and disorganized
    behaviour.

[20]

Dr. de Souzas evidence was corroborated by the appellants evidence in
    addition to
consultation reports from the appellants five
    visits to the ER. Although the authors of these reports did not testify, the
    Board is permitted to rely on hearsay evidence in determining whether or not
    Dr. de Souzas evidence was corroborated:
Starson
, at para. 115;
Anten v. Bhalerao
, 2013 ONCA 499, 366 D.L.R. (4th) 370,
at para. 32;
Statutory Powers Procedure Act
, R.S.O. 1990, c. S.22, s. 15. The Board also had evidence from
    additional sources, including letters from the appellants father and sister.

[21]

In these circumstances, the question is not whether
    there was any evidence supporting the Boards decision but, instead, whether
    the Board reached a reasonable decision given that evidence.

[22]

The Board found that the appellant lacks insight into her condition
    as a result of her disorder and is unable to weigh the benefits against the
    risks of antipsychotic medication because she does not recognize the past
    benefits or the anticipated benefits of the treatment.
As Justice Major explained
    in
Starson
, at para. 79: [I]f the patients condition results in
    [her] being unable to recognize that [s]he is affected by its manifestations,
    [s]he will be unable to apply the relevant information to [her] circumstances,
    and unable to appreciate the consequences of [her] decision.
The
    appellants testimony before the Board demonstrated the problem. She both
    acknowledged and denied that she suffers from a mental disorder. She refused to
    accept the views of family and treatment providers and blamed others for her
    difficulties.

[23]

In short, the Boards conclusion that the appellant is not able to appreciate
    the consequences of her decision to accept or reject treatment is supported by
    the record and is reasonable. There is no basis for this court to interfere
    with it.

Is the Boards decision concerning the appellants
    capacity to make treatment decisions about side effects medications reasonable?

[24]

Amicus
submitted that the Boards decision does not
    support the conclusion that the appellant
is incapable of
    consenting to treatment with side effects medications
as well as antipsychotic medications, and is
    unreasonable on that account. This argument was not raised before the Board or
    before the appeal judge.

[25]

In general, this court will not
    entertain new issues on appeal save in exceptional circumstances:
Sawdon
    Estate v. Sawdon
, 2014 ONCA 101, 119 O.R. (3d) 81, at para. 75.
Amicus
failed to demonstrate any such circumstances and, as a result, I would not entertain
    this argument.

Disposition

[26]

Accordingly, I would dismiss the appeal. I would make no order as to
    costs.

Released: February 25, 2016
    GH

Grant
    Huscroft J.A.

I
    agree Janet Simmons J.A.

I
    agree H.S. LaForme J.A.