COURT OF APPEAL FOR ONTARIO

CITATION: Xela Enterprises Ltd. v. Castillo, 2016 ONCA 437

DATE: 20160603

DOCKET: C60470

Weiler, LaForme and Huscroft JJ.A.

In the matter of Xela
    Enterprises Ltd.

and in the matter of
    696096 Alberta Ltd.

and in the matter of
  the
Ontario Business Corporations Act

BETWEEN

Xela Enterprises
    Ltd., Gabinvest S.A., Lisa S.A.,
Juan Arturo Gutiérrez, Juan Guillermo Gutiérrez,
and 696096 Alberta Ltd.

Plaintiffs

(Respondents)

- and -

Margarita Castillo,
    Roberto Ricardo Castillo,

Juan Luis Bosch Gutiérrez, Dionisio Gutiérrez, Mayorga,
Juan Jose Gutiérrez, Mayorga, Felipe Antonio Bosch Gutiérrez
, Roberto
    Barillas Castillo,
Isabel Gutiérrez De Bosch, La Braña, S.A.,
    Multi-Inversiones, S.A., Villamorey, S.A. and Avicola Villalobos S.A.

Defendants

(
Appellants
)

Katherine L. Kay and Aaron L. Kreaden, for the
    appellants

Joseph Groia and Martin Mendelzon, for the respondents

Heard:  January 12, 2016

On appeal from the order of the Divisional Court
    (Justices David L. Corbett, Paul M. Perell and Cory A. Gilmore), dated February
    5, 2015, with reasons reported at 2015 ONSC 866, dismissing an appeal of the
    order of Justice Julie A. Thorburn of the Superior Court of Justice, dated January
    20, 2014, with reasons reported at 2014 ONSC 352.

Huscroft J.A.:

[1]

Can defendants in a state that is not party to the
Convention on the
    Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial
    Matters
(the Hague Convention) be served in accordance with Ontario
    rules in an Ontario action? That is the question posed by this case.

[2]

The plaintiffs are individuals residing in Canada and companies carrying
    on business in Canada, as well as two Panamanian companies. They seek $400
    million in damages from the defendants, individuals residing in Guatemala or
    companies carrying on business in Guatemala, for conspiracy to commit tortious
    acts, breach of fiduciary duties, fraud and abuse of process, and unjust enrichment.
    Their claim alleges that the damages were sustained in Ontario.

[3]

The motion judge found that the appellants were served validly in
    accordance with the
Rules of Civil Procedure
, R.R.O. 1990, Reg. 194
    (the
Rules
). Her order was upheld by the Divisional Court and the
    appellants appeal to this court with leave. They submit that the Divisional
    Court erred in interpreting r. 17.05(2) of the
Rules
, by failing to interpret
    it in a manner consistent with Canadas international law obligations.

[4]

For the reasons that follow, I would dismiss the appeal.

BACKGROUND

Facts

[5]

The Ontario action is a dispute between two factions of the Gutiérrez
    family. The action was commenced by a statement of claim issued in Ontario on
    April 12, 2011. A fresh as amended statement of claim was issued on February
    28, 2013.

[6]

The respondents attempted to serve the fresh as amended claim on several
    occasions and in several different ways. They emailed a copy to the appellants
    Canadian legal counsel on March 1, 2013; they sent a copy by courier to the
    appellants U.S. counsel on March 1, 2013; and they attempted to serve the
    appellants at their residences and businesses in Guatemala on March 15, 2013.

[7]

The respondents brought a motion seeking a declaration that the
    appellants were properly served in accordance with rr. 17.02 and 17.05 of the
Rules
,
    validating service pursuant to r. 16.08, or ordering substituted service
    pursuant to r. 16.04.

Ontarios rules governing
    service

[8]

Service outside of Ontario is governed by different rules depending on
    whether the defendant resides in a state that is signatory to the Hague
    Convention. Service on defendants residing in signatory states is required to
    be effected through the central authority in the contracting state or in a
    manner permitted by the Hague Convention (r. 17.05(3)).

[9]

Guatemala is not a party to the Hague Convention. As a result, service
    in Guatemala is governed by r. 17.05(2), which provides as follows:

An originating process or other document to be served outside
    Ontario in a jurisdiction that is not a contracting state may be served in the
    manner provided by these rules for service in Ontario, or in the manner
    provided by the law of the jurisdiction where service is made, if service made
    in that manner could reasonably be expected to come to the notice of the person
    to be served.

DECISIONS BELOW

The motion judge

[10]

The motion judge found that, because Guatemala is a non-contracting
    state, r. 17.05(2) allows the respondents to serve the appellants in accordance
    with the
Rules
, and that the respondents were served in accordance
    with those rules.

[11]

She found, further, that the corporate appellants were properly served
    by leaving a copy of the fresh as amended claim with a person who appeared to
    be in control or management of their places of business. The motion judge found
    that service on the individual appellants was attempted but was unsuccessful; a
    copy of the pleading was left at the residence of each individual and sent by
    courier, and a further copy was sent to their Canadian counsel; and that the
    fresh claim came to the notice of the individual appellants. As a result, the
    motion judge made an order validating service on the individual defendants in
    accordance with r. 16.08.

[12]

The motion judge considered and rejected the appellants argument that a
    failure to apply Guatemalan law resulted in an absence of comity. She found
    that Guatemalan law does not prohibit a party outside the jurisdiction from
    serving a party in Guatemala in a manner permitted by Ontario law, and that an
    interpretation of the
Rules
that required the respondents to follow
    the rules of service in Guatemala would itself contravene the principles of
    comity by denying the choice r. 17.05(2) provides. Finally, the motion judge
    noted that the appellants retained their right to address the issues of
    attornment to Ontario law and whether Ontario is the most convenient forum.

The Divisional Court

[13]

The Divisional Court dismissed an appeal from the motion judges
    decision. The court noted that Guatemala is a civilian jurisdiction and that
    the Guatemalan courts must be involved in the appointment of notaries to effect
    service within Guatemala, and stated that direct service by a party violates
    the Guatemalan constitution. Although the court accepted that the
Rules
must
    be interpreted in a manner that conforms to Canadas international obligations,
    it concluded that the motion judges interpretation of r. 17.05 did not offend that
    requirement.

[14]

The Divisional Court stated that the principle of comity does not
    override the express intent of Ontarios rules relating to service, which the
    court described as conflicting legislation within the meaning of
R. v.
    Hape
, 2007 SCC 26, [2007] 2 S.C.R. 292, at para. 46.

[15]

Finally, the Divisional Court concluded that the motion judge was
    entitled to exercise her discretion to validate service, given her finding that
    the claim had come to the appellants attention. The court stated: As
    Guatemala is not a signatory to the
Hague Convention
, service in accordance
    with the Ontario Rules does not undermine any Canadian International Law
    obligation.

ANALYSIS

[16]

It is not contested that, on its face, r. 17.05(2) authorizes the
    respondents to serve the appellants outside Ontario. Nor is it contested that
    the motion judge was entitled to exercise her discretion to validate service
    under the
Rules
because the fresh as amended statement of claim had
    come to the appellants attention. What is contested is whether Canadas
    international law obligations or the principle of comity among nations have the
    effect of requiring service in accordance with the law of Guatemala, despite
    the choice of service r. 17.05(2) provides.

[17]

It is common ground that service in Guatemala did not comply with
    Guatemalan law. The Divisional Court went further, stating that [d]irect
    service by a party violates the Guatemalan constitution, and this is repeated
    by the appellants. However, the motion judge did not address the requirements
    of Guatemalan constitutional law and it was not necessary for the Divisional
    Court to do so on appeal.

[18]

For purposes of this appeal, it is enough to proceed from the premise
    that service in Guatemala pursuant to r. 17.05(2) was not in accordance with
    Guatemalan law. The question is whether Canadas international law obligations
    and/or the principle of comity require the respondents to effect service in the
    manner provided for by Guatemalan law, despite the choice r. 17.05(2) provides.

The requirements of international
    law

[19]

It is important to distinguish two forms of international law,
    conventional (treaty-based) international law and customary international law.

[20]

Conventional international law is concerned with treaties negotiated
    between states. Treaties create obligations as between signatory states but, in
    general, do not create enforceable obligations in Canadian law unless they are
    adopted by Canadian legislation. The Hague Convention is specifically adopted into
    Ontario law by rr. 17.05(3) and (4), which govern service and proof of service
    in Convention states.

[21]

In contrast, customary international law involves rules that are acknowledged
    as binding by the state. As Guatemala is not a signatory to the Hague
    Convention, this case is concerned with the impact of customary international
    law rather than conventional.

[22]

There is a rebuttable presumption that Canadian legislation complies
    with Canadas international law obligations, both conventional and customary,
    as the Supreme Court in
Hape
explained, at para 53:

The presumption of conformity is based on the rule of judicial
    policy that, as a matter of law, courts will strive to avoid constructions of
    domestic law pursuant to which the state would be in violation of its
    international obligations, unless the wording of the statute clearly compels
    that result.  The presumption is rebuttable, however. Parliamentary
    sovereignty requires courts to give effect to a statute that demonstrates an
    unequivocal legislative intent to default on an international obligation.

See

also
R. v. Appulonappa
, 2015 SCC
    59, [2015] 3 S.C.R. 754, at para. 40.

[23]

The interpretive presumption outlined in
Hape
applies to
    secondary legislation  regulations such as the
Rules
 as well as
    primary legislation. Thus the
Rules
, and in particular r. 17.05(2),
    are presumed to comply with conventional as well as customary international
    law, and courts must avoid interpretations of the
Rules
that would
    render Ontario law inconsistent with international law unless there is a clear
    legislative intent to the contrary.

[24]

The decisions below do not specifically address the principle of state
    sovereignty, which is part of customary international law. Instead, the motion
    judges decision focuses on the principle of comity, which is discussed below.
    Although the Divisional Court concluded that service in accordance with the
Rules
does not undermine Canadas international law obligations, the court addressed
    only the requirements of the Hague Convention.

Interpretation of r.
    17.05(2)

[25]

I set out r. 17.05(2) again for convenience:

An originating process or other
    document to be served outside Ontario in a jurisdiction that is not a
    contracting state may be served in the manner provided by these rules for
    service in Ontario, or in the manner provided by the law of the jurisdiction
    where service is made, if service made in that manner could reasonably be
    expected to come to the notice of the person to be served.

[26]

The appellants make two main submissions on the interpretation of r. 17.05(2).
    First, they submit that the courts below erred in failing to interpret r. 17.05(2)
    in accordance with the customary international law principle of state
    sovereignty. Second, the appellants submit that the Divisional Court erred in
    concluding that the wording of r. 17.05(2) is sufficient to rebut the
    interpretive presumption that Ontario law complies with international law. In
    other words, they contend that the Divisional Court erred in finding that r.
    17.05(2) amounts to conflicting legislation within the meaning of
Hape
.

[27]

I will deal with each of these arguments in turn, and then
    address the comity argument.

(1)

Did the motion judge err in failing to interpret r.
    17.05(2) in accordance with the customary international law principle of state sovereignty?

[28]

In the appellants submission, r. 17.05(2) does not dictate how the
    choice between service under Ontario law or foreign law is to be made and does
    not purport to override international law. As a result, the rule must be
    interpreted in accordance with Canadas international law obligations, and this
    requires that the rule be interpreted in a manner that respects Guatemalan
    sovereignty. This, they submit, requires that service in Guatemala be effected
    in accordance with Guatemalan law, which requires authorization by a Guatemalan
    court or tribunal.

[29]

I would reject this argument.

[30]

The
Rules
do not purport to legalize service that would be
    illegal in Guatemala, nor do they purport to declare Ontario is the proper
    forum for an action. They provide an option as to how service may be effected in
    a non-Convention state
for purposes of an
    Ontario action
. They establish a means of satisfying an Ontario
    court that foreign defendants have received notice of an Ontario action. As the
    motion judge noted, the appellants retain their right to challenge the
    jurisdiction of Ontarios courts over the subject-matter of the action. An
    Ontario court must ultimately determine whether it has jurisdiction over the
    action, and, in the event that it does, whether it should stay the proceedings
    on the basis of the
forum non conveniens
doctrine:
Club Resorts
    Ltd. v. Van Breda
, 2012 SCC 17, [2012] 1 S.C.R. 572.

[31]

It is, therefore, a considerable overstatement to characterize the rules
    governing service as constituting interference in the affairs of a foreign
    state. In this regard, I agree with the decision of the Supreme Court of the
    United Kingdom in
Abela and others v. Baadarani,
[2013] UKSC 44, at para. 53,
per
Lord Sumption:

The characterisation of the service of process abroad as an
    assertion of sovereignty may have been superficially plausible under the old
    form of writ (We command you...). But it is, and probably always was, in
    reality no more than notice of the commencement of proceedings which was
    necessary to enable the Defendant to decide whether and if so how to respond in
    his own interest. It should no longer be necessary to resort to the kind of
    muscular presumptions against service out.  The decision is generally a
    pragmatic one in the interests of the efficient conduct of litigation in an
    appropriate forum.

[32]

The appellants attempt to distinguish
Abela
on the basis that
    the manner of service in that case, which concerned another non-Hague
    Convention state (Lebanon), was not contrary to the law of that state, whereas
    the service in this case violates the law of Guatemala and is subject to
    penalty.

[33]

The motion judge made a contrary finding concerning the law of
    Guatemala. She stated: Guatemalan lawdoes not specifically prohibit a party
    outside the jurisdiction from serving a party in Guatemala in a way permitted
    by Ontarios domestic law or create an offence for so doing.

[34]

Although there is evidence indicating that unauthorized service in
    Guatemala is illegal and subject to a penalty, it is not clear that the penalty
    applies to service
ex juris.
Moreover,
the penalty for violating the law appears to be in the
de minimis
range, as though it is akin to an administrative or regulatory matter. There is
    no evidence concerning the enforcement of the law in any event. The significant
    consequence of unauthorized service is that it may be considered a nullity, and
    a Guatemalan court may not recognize or enforce an Ontario judgment as a
    result.

[35]

In all of the circumstances, I am not satisfied that the motion judge
    erred in her conclusions about Guatemalan law.

(2)

Is r. 17.05(2) conflicting legislation?

[36]

The conclusion that service pursuant to r. 17.05(2) does not violate
    Guatemalan sovereignty, and hence principles of customary international law, is
    sufficient to dispose of this appeal. That said, there is an alternative means
    of reaching the same conclusion. Even assuming that service pursuant to r. 17.05(2)
    violates Guatemalan sovereignty, in my view it is not open to interpret the
    rule in the manner proposed by the appellants because the presumption of
    conformity with international law is rebutted.

[37]

The appellants acknowledge that the presumption of conformity with
    international law is rebuttable, but emphasize language from
Hape
that
    suggests a requirement that the wording of the legislation clearly compels
    the finding of inconsistency. Nothing, they submit, demonstrates an intention
    to disregard Canadas international law obligation to respect the sovereignty
    of sovereign states concerning service
ex juris
. On the contrary, the
    appellants assert that r. 17.05(2) was designed to allow for service in a
    manner that respects the sovereignty of foreign states.

[38]

The appellants submit that r. 17.05(2) should be interpreted as
    requiring service to be carried out in accordance with the law of the
    destination state for civilian states, while service in common law states may
    be carried out in accordance with the
Rules
.

[39]

I would reject this argument.

[40]

There is little authority concerning the nature of a conflict with
    international law for purposes of rebutting the presumption of conformity: see O.
    Jones, The Doctrine of Adoption of Customary International Law: A Future in
    Conflicting Domestic Law and Crown Tort Liability (2010) 89 Can. Bar. Rev.
    401, at pp. 403-411. Although, as the appellants submit, the
Rules
evince
    an intention to respect Canadas conventional international law obligations by
    specifically recognizing the Hague Convention obligations and requiring service
    in accordance with those obligations, it does not follow that the rule
    regarding service in non-Hague Convention states can be read as being in
    conformity with customary international law.

[41]

Ontarios rules governing service expressly establish two different
    means of effecting service outside Ontario, depending on whether the relevant
    state is signatory to the Hague Convention. Service in a Hague Convention state
    must be completed in accordance with the requirements of the Convention, but
    service on a party in a non-Hague Convention state may be effected in
    accordance with either Ontario rules or the rules of the foreign state
at
    the choice of the serving party
. The unequivocal intent of r. 17.05 is
    that the serving party is to be afforded the choice.

[42]

The appellants argument would render this choice illusory. The
    respondents could serve in accordance with the
Rules
only so long as
    the law of the foreign state were compatible with Ontario law. The law of
    civilian states is necessarily different than Ontario law; so, in effect, the
    respondents would be deprived of the choice the rule is designed to provide.
    They could serve in accordance with Guatemalan law or not at all.

[43]

Thus, even assuming that r. 17.05 is inconsistent with customary international
    law, the operational requirements of the rule rebut the presumption of
    conformity and, as a result, the rule governs.

The principle of comity

[44]

The appellants cite
Tolofson v. Jensen,
[1994] 3 S.C.R. 1022,
    and in particular Justice La Forests remarks, at p. 1047, that the ability of
    states to make and apply law within their territorial limits will ordinarily be
    respected, absent a breach of some overriding norm.

[45]

The concept of comity is well understood in Canadian law. In
Chevron
    Corp. v. Yaiguaje
, 2015 SCC 42, [2015] 3 S.C.R. 69, at
    para. 51, the Supreme Court described comity as:

the deference and respect due by other states
    to the actions of a state legitimately taken within its territory, as well as
    the recognition which one nation allows within its territory to the
    legislative, executive or judicial acts of another nation, having due regard
    both to international duty and convenience, and to the rights of its own
    citizens or of other persons who are under the protection of its laws: [citing
Morguard Investments Ltd. v. De Savoye
, [1990]
    3 S.C.R. 1077, at pp. 1095-96], quoting with approval the U.S. Supreme Courts
    foundational articulation of the concept of comity in
Hilton v.
    Guyot
, 159 U.S. 113 (1895), at pp. 163-64; see also
Spencer
    v. The Queen
, [1985] 2 S.C.R. 278, at p. 283, per Estey
    J., concurring.

[46]

In
Hape
, at para. 47, the Court described comity as relating to

informal acts performed and rules
    observed by states in their mutual relations out of politeness, convenience and
    goodwill, rather than strict legal obligation. [It is] more a principle of
    interpretation than a rule of law, because it does not arise from formal
    obligations.  The Court added, at para 48: Where our laws  statutory
    and constitutional  could have an impact on the sovereignty of other states,
    the principle of comity will bear on their interpretation.

[47]

I have already concluded the Ontario rules governing service for
    purposes of an Ontario action do not impact on Guatemalan sovereignty. Service
    pursuant to r. 17.05 is a procedural step, and the appellants mischaracterize
    things in suggesting that it involves an assertion of Ontario jurisdiction over
    them. The respondents are entitled to have the rule applied according to its
    terms and the choice it provides. As the motion judge noted, a requirement that
    Guatemalan rules of service be followed would contravene the rights of those
    under the protection of Ontario law.

DISPOSITION

[48]

I would dismiss the appeal.

[49]

I would order the appellants to pay costs to the respondents agreed in
    the amount of $20,000, inclusive of taxes and disbursements.

Released: June 3, 2016 KMW

Grant
    Huscroft J.A.

I
    agree K.M. Weiler J.A.

I
    agree H.S. LaForme J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Anderson v. McWatt, 2016 ONCA 553

DATE: 20160708

DOCKET: C60768

MacPherson, Cronk and Benotto JJ.A.

BETWEEN

Helen Anderson

Applicant (Respondent)

and

Roger McWatt

Respondent (Appellant)

Gary Joseph and Ryan Kniznik, for the appellant

Patrick D. Schmidt, George Karahotzitis and Melanie A.
    Larock, for the respondent

Heard: July 6, 2016

On appeal from the order of Justice
Victoria
    R.
Chiappetta of the Superior Court of Justice, dated June 24, 2015.

By the
    Court:

[1]

At the conclusion of the appellants submissions, we advised that the
    appeal would be dismissed with reasons to follow. These are those reasons.

[2]

The parties began living together in 1980. They married in 1989 and had
    two children who are now adults. In 2000, the respondent petitioned for
    divorce. For the next 15 years, the parties were mired in high conflict
    litigation. The trial in 2015 lasted 16 days. The appellant (husband), who
    represented himself at trial, challenges certain aspects of the judgment and
    the costs award.

Brief Background

[3]

The parties are interior designers who together created a successful
    business and acquired various properties. McWatt Anderson was jointly owned;
    the appellant had a 55% interest and the respondent 45%.

[4]

In April 1987, just prior to the parties marriage, the appellant purchased
     in his name alone  a commercial investment property on Atlantic Ave. in
    Toronto. The parties had previously discussed with their accountant the
    advisability of incorporating a company to take ownership of the Atlantic
    property.  In 1988, the appellant incorporated Stratus Development Corporation
    (Stratus). The respondent believed that Stratus owned the Atlantic property. The
    financial statements of Stratus stated that ownership of the property was
    transferred or rolled over to it under s. 85.1 of the
Income Tax Act
.
    However, no such transfer or rollover ever took place. The trial judge found
    that it was not until 2012 that the respondent learned that title to the
    property was registered in the appellants name alone.

[5]

Both parties contributed to the renovations and maintenance of the building
    after it was purchased. Between April 1987 and June 2000, the Atlantic property
    was used by the parties, in part to house the operations of McWatt Anderson.
    After June 2000, following the parties separation, the respondent stopped
    going to work at McWatt Anderson and formally resigned in December 2001. From
    June 2000 onward, the appellant operated his own business, McWatt & Associates,
    out of the Atlantic property.

[6]

In May 2014, the respondent obtained leave to amend her pleadings to
    make an unjust enrichment claim and to seek a constructive trust against the
    Atlantic property. The unjust enrichment issue was a primary focus of the trial
    below.

Trial Judgment

[7]

The trial judges reasons run to 87 pages and deal with all matters
    arising from the marriage. The appellant challenges three aspects of the
    judgment: (i) the award of a 45% interest in the Atlantic property to the
    respondent on the basis of unjust enrichment; (ii) the award of retroactive
    spousal support for the years 2000-2015; and (iii) the award of prejudgment
    interest on the equalization payment.

Discussion

Unjust Enrichment

[8]

The appellant raises three issues with respect to the finding of unjust
    enrichment: first, he alleges that the claim is statute barred; second, he
    challenges the apportionment of 45% to the respondent; third, he submits that if
    he is unsuccessful on his limitation period argument, the respondent should receive
    a monetary award, not an interest in the property.

[9]

The trial judge found that the doctrine of fraudulent concealment
    applied to toll the limitation period. In accordance with
R. v. Guerin
,
    [1984] 2 S.C.R. 335 at paras. 98-99, the limitation period did not start to run
    until the respondent discovers the fraud, or until the time when, with
    reasonable diligence, she ought to have discovered it. The trial judge
    concluded at para. 77:

By attesting to the untruth that Stratus was the beneficial
    owner of 28 Atlantic, the [appellant] concealed the [respondents] right to
    claim equitable ownership in the building as her claim in equity is triggered
    by the very ownership he was purposively concealing.  It is appropriate
    considering the totality of the circumstances, therefore, to invoke the Courts
    equitable jurisdiction to stay the operation of the limitation period. The [appellants]
    conduct in representing that his interest was transferred and concealing that
    his interest was never transferred constitutes an abuse of the parties special
    relationship. The [respondent] discovered that abuse for the first time by the [appellants]
    admission of previous deceit in February/May 2012. The limitation period under
    the
Real Property Limitations Act
is
    therefore stayed until that time.

[10]

The appellant submits that the trial judge erred in her finding that the
    respondent did not know that the property was registered in the appellants
    name until 2012.  He says that the respondent knew or should have known in 2001
    that the property was in the appellants name. He submits that, because her
    counsel knew, she knew. In particular, she is bound by comments her counsel
    made during her questioning in 2001 when her counsel said that the appellant
    was the registered owner of the Atlantic property. Counsel was then asked if he
    was making a claim to the Atlantic property on the basis of a constructive
    trust. He responded: When we finish your clients examination, we have no
    claim at the present made in our petition. We may very well have a claim
    against the property.  And he also said: We will make our claim as and when
    we feel we have sufficient facts to base it on. This section of the
    questioning was read on the record at trial.

[11]

The appellant argues that the trial judge did not address this evidence
    when she considered the limitation period. By not addressing this evidence, the
    appellant argues that the trial judge made a reversible error because the
    evidence confirms that the respondent knew of her claim in 2001.

[12]

We do not agree.

[13]

At the time of the questioning, and for the next 11 years, the appellant
    swore financial statements and affidavits confirming that the Atlantic property
    was held by Stratus. The respondent was entitled to rely on this disclosure. Her
    counsels indication that she may have a claim was not an admission that she
    had a claim such that the limitation period was triggered.

[14]

While not pressed in oral submissions, the appellant submits generally
    that the respondent could have, with reasonable diligence, discovered the true
    ownership of the Atlantic property long before 2012. While the trial judge did
    not directly address the reasonable diligence argument  made for the first
    time on appeal  her reasons read as a whole make her findings clear that the
    respondent did everything she reasonably could to determine the truth that the
    appellant was concealing.

[15]

The trial judge found that the respondent suffered from clinical
    depression,  depleted her RRSPs as a result of the appellants continual child
    support arrears,  was abused by the appellant and by the time of trial was a
    shell of a personvisibly diminished.  At paragraph 25, the trial judge said
    this:

As the [appellant] is self-represented, he conducted the
    cross-examination of the [respondent]. His conduct demonstrated the [respondents]
    testimony of her gradual diminishment at the hands of a controlling spouse who
    consistently undermined their mutual efforts and dismissed her thoughts and
    feelings. Instead of asking a question and receiving an answer, the [appellant]
    attempted to control the answers, telling her what she meant to say or
    suggesting that her words were in some way unworthy. The [appellant] felt it
    appropriate to judge the [respondents] answers using the words yes, no or
    close despite clear direction by the Court not to do so. The [respondent] on
    one occasion pleaded that she needed a break as he is in my head. Throughout
    the cross-examination it became abundantly clear to me that this woman was
    conditioned to be submissive to the thoughts and opinions of the person asking
    her the questions.

[16]

These findings make it clear that the trial judge determined that the
    respondent did all she could reasonably have done to find out the true
    ownership of the Atlantic property.

[17]

Although the appellant takes no issue with the finding of unjust
    enrichment, he submits that the trial judge erred in finding that the
    respondent was entitled to a 45% interest in the property.  Again, we disagree.

[18]

The trial judge accepted the respondents evidence that she believed
    that the Atlantic property would be jointly owned. She found that the joint
    efforts of the parties contributed to the acquisition and maintenance of the
    building. She rejected the appellants evidence that he had arranged and
    personally paid for renovations post-separation which contributed to the
    present day value. She also found that the appellant had lied to the respondent
    by telling her the property was owned by Stratus  a corporation in which she
    held shares. These findings of fact were open to the trial judge and supported
    the finding of a constructive trust.

[19]

Lastly with respect to unjust enrichment, the appellant challenges the
    remedy. He submits that the trial judge should have made a monetary award
    instead of awarding an interest in property. The trial judge considered and
    rejected the appropriateness of a monetary award. She considered the difficulty
    of recovery, the contributions made by the respondent, the market forces that
    increased the value of the property, and the profits that the appellant had
    taken for himself. We see no error in her analysis.

Retroactive Spousal
    Support

[20]

Although addressed only briefly in oral submissions, the appellant also
    challenged the retroactive spousal support award.

[21]

The quantum of spousal support was based on compensatory and non-compensatory
    principles. The trial judge found that the respondent: (i) assumed primary
    responsibility for the household and the children during the marriage and after
    separation; (ii) contributed equally to the success of the parties joint
    business; (iii) suffered undue economic hardship from the marriage breakdown by
    drawing from her RRSP investments and securing debt against the matrimonial
    home to provide for her needs and those of the children; (iv) made valiant
    efforts at self-sufficiency after the marriage but has been unable to achieve a
    degree of self-sufficiency having regard to the marital standard of living; (v)
    suffered economic disadvantage to the advantage of the appellant; and (vi)
    suffered  emotional abuse by the appellant, which had an ongoing impact on her
    health and professional abilities. The quantum of support ordered was based on
    the high range of the SSAGs. We see no error in this analysis.

[22]

Nor did the trial judge err in awarding retroactive spousal support in
    light of her findings that: (i) the respondent had to deplete $670,000 in RRSPs
    during the proceedings to support herself because of the appellants failure to
    provide adequate support; and (ii) the appellant engaged in a repeated pattern
    of ignoring the interim spousal support order and accumulating arrears, and suppressed
    his true available income for support purposes through the company he
    controlled, Stratus.

Prejudgment interest

[23]

The trial judge found that the appellant owed the respondent an
    equalization payment of
$62,731.69. She held that the
    equalization payment was due and payable to the respondent on September 1, 1997
    and that there is no reason to depart from the general rule that the payor
    spouse is required to pay prejudgment interest on the equalization payment
    owing to the payee spouse, at the judges discretion.

[24]

There was no objective evidence that the
    appellant did not have the ability to pay the equalization amount prior to this
    order. Rather, he delayed the precise calculation of the equalization amount by
    concealing until 2012 that the Atlantic property was not rolled over into
    Stratus and further concealing until 2014 that the parties other properties
    had not been rolled over into McWatt Anderson. The trial judge concluded that
    he should therefore pay prejudgment interest in accordance with the average
    rate on an annual basis for each year in question, as set out in the
Courts of Justice Act
R.S.O. 1990,
    c.43. We see reason to interfere with this exercise of discretion.

Costs

[25]

We also see no error in the trial judges award
    of costs. While the amount awarded is high, it reflects 15 years of
    high-conflict litigation involving multiple court attendances. The trial judge
    set out the provisions of Rule 24 in detail and carefully applied each
    consideration to the facts. In our view, the costs award is neither plainly
    wrong, nor tainted by any palpable and overriding error.

Disposition

[26]

The appeal is dismissed with costs payable to
    the respondent in the amount of $35,000, inclusive of disbursements and HST.

Released: July 8, 2016

J.C. MacPherson
    J.A.

E.A. Cronk J.A.

M.L. Benotto J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Babington-Browne v. Canada (Attorney General), 2016
    ONCA 549

DATE: 20160708

DOCKET: C61150

Laskin, Tulloch and Hourigan JJ.A.

BETWEEN

Nina Babington-Browne and Daniel Babington-Browne

Plaintiffs (Appellants)

and

The Attorney General of Canada, North Atlantic
    Treaty Organization, John Doe, John Doe #2 (the Estate of), John Doe #3 and ABC
    Inc.

Defendants (Respondents)

Todd Burke, for the appellants

Helene Robertson and Sanam Goudarzi, for the respondents

Heard: April 14, 2016

On appeal from the order of Justice Martin S. James of
    the Superior Court of Justice, dated September 18, 2016, with reasons reported
    at 2015 ONSC 6102.

Laskin
    J.A.:

A.

Overview

[1]

The general question on this appeal is whether the Ontario Superior
    Court has jurisdiction over the appellants negligence action against the federal
    Crown.

[2]

In July 2009, Captain Ben Babington-Browne, a British soldier, was
    killed in a helicopter crash in Afghanistan. He had been deployed there for a
    coalition mission directed by Canadas Department of National Defence and
    coordinated by NATO. The Canadian Forces helicopter in which Babington-Browne
    had been a passenger crashed into a security wall on take-off from a base in
    Afghanistan.

[3]

In July 2011, Babington-Brownes mother and brother brought an action
    under s. 61 of the
Family Law Act
,
    R.S.O. 1990, c. F.3,
[1]
against the federal Crown, represented by the Attorney General of Canada
[2]
,
    and against the pilot, aircraft captain, and flight engineer who operated the
    helicopter on the day of the crash. These three individuals are named as John
    Doe defendants as the appellants do not know their identities.
[3]
The appellants claimed that Babington-Browne died because of the negligence of
    all the defendants. They brought their action not in the Federal Court but in
    the Ontario Superior Court.

[4]

The Attorney General of Canada moved to strike the claim on either of
    two grounds: the action was started beyond the six-month limitation period in
    s. 269 of the
National Defence Act
,
    R.S.C. 1985, c. N-5
; and the Ontario Superior Court has no
    jurisdiction over the claim against the federal Crown. The motion judge ruled
    that the limitation period did not bar the action because the claim was not
    discoverable until the Canadian Forces Board of Inquiry investigating the
    accident reported its findings in April 2011. That ruling is not under appeal.

[5]

The motion judge, however, struck the claim against the federal Crown on
    the ground that the Ontario Superior Court lacked jurisdiction to hear it.
    Under s. 21(1) of the
Crown Liability and Proceedings Act
,
R.S.C. 1985, c. C-50 (
CLPA
),
    the Ontario Superior Court would have jurisdiction only if the claim against
    the federal Crown arose in Ontario. The motion judge ruled that the claim arose
    in Afghanistan, not in Ontario.

[6]

Babington-Brownes mother and brother appeal the motion judges ruling
    on jurisdiction. The issue on the appeal is did the motion judge err in his
    interpretation and application of s. 21(1) of the
CLPA
. The appellants
    make two submissions. First, in interpreting s. 21(1), the motion judge erred
    because he failed to apply the test for jurisdiction established by the Supreme
    Court of Canada in
Club Resorts Ltd. v. Van Breda
, 2012 SCC 17, [2012]
    1 S.C.R. 572. Second, if that test applies, the Ontario Superior Court has
    jurisdiction over the claim against the federal Crown.

[7]

The Attorney General of Canada submits that the motion judges ruling on
    jurisdiction is correct.
Van Breda
does not apply to the
    interpretation of s. 21(1) of the
CLPA
and the appellants claim arose
    in Afghanistan. Only the Federal Court has jurisdiction over the claim against
    the federal Crown.

[8]

I agree with the Attorney Generals submissions and therefore would
    dismiss the appeal. My decision, however, does not affect the claim against the
    three John Doe defendants. That claim will continue in the Ontario Superior
    Court, and the Attorney General has agreed that it will honour any judgments
    against these defendants.

B.

The Interpretation of Section 21(1) of
    the
CLPA

(1)

The Rationale
    for s. 21(1)

[9]

Section 21(1) came into effect by amendment to the
CLPA
in 1992.
    By the amendment, for claims against the federal Crown, a court of the province
    in which the claim arises has concurrent jurisdiction with the Federal Court.
    The wording of s. 21(1) has changed since it was introduced, but the effect of
    the provision is the same. Section 21(1) now states:

In all cases where a claim is made against the Crown,
    except where the Federal Court has exclusive jurisdiction with respect to it,
    the superior court of the province in which the claim arises has concurrent
    jurisdiction with respect to the subject-matter of the claim.
[4]

[10]

The rationale for the addition of s. 21(1) has some significance for this
    appeal. At common law, the federal Crown could not be sued in tort, or indeed
    in any court. Thus, the provincial superior court could not assert an inherent
    jurisdiction over claims against the federal Crown.

[11]

Moreover, because of s. 101 of the
Constitution Act, 1867
[5]
,
    only Parliament can enact laws authorizing claims against the federal Crown. A provincial
    superior court will have jurisdiction over claims against the federal Crown
    only where a federal statute expressly confers that jurisdiction on the court:
Rudolph
    Wolff & Co. v. Canada
, [1990] 1 S.C.R. 695, at p. 700.

[12]

Before the 1992 amendment, jurisdiction over claims against the federal
    Crown resided exclusively with the Federal Court:
Federal Court Act
,
R.S.C. 1985, c. F-7,
s. 17; Peter W.
    Hogg, Patrick J. Monahan, and Wade K. Wright,
Liability of the Crown
,
    4th ed, (Toronto: Carswell, 2011), at p. 488. The Federal Courts exclusive
    jurisdiction created a problem for plaintiffs who wanted to sue the federal
    Crown and individuals for claims arising out of the same or a related set of
    facts. Under s. 101 of the
Constitution Act, 1867
, the Federal Court can
    hear only claims involving the laws of Canada. A plaintiff suing the federal
    Crown and other defendants would have to sue the federal Crown in the Federal
    Court, and the other defendants in a provincial superior court, unless the claims
    against those other defendants were governed by federal law.

[13]

This problem for plaintiffs was largely solved by the 1992 amendment to
    the
CLPA
. By s. 21(1), Parliament gave provincial superior courts
    concurrent jurisdiction with the Federal Court over claims against the federal
    Crown so long as the claim arose in their province. Other claims against the federal
    Crown remain within the exclusive jurisdiction of the Federal Court.

[14]

The purpose of s. 21(1) was to limit or eliminate multiple proceedings
    arising out of the same set of facts and to facilitate citizens access to
    justice. But  to repeat  under s. 21(1) a provincial superior courts
    jurisdiction over claims against the federal Crown is not open-ended. A
    provincial superior court will have jurisdiction only if the claim arose in its
    province:
Djukic v. Canada (Attorney General)
(2000), 52 O.R. (3d) 348
    (C.A.), at para. 6. Against this background I turn to the appellants first
    submission.

(2)

Does
Van
    Breda
Apply to the Interpretation of s. 21(1) of the
CLPA
?

[15]

In
Van Breda
, the Supreme Court of Canada discussed  in the
    context of private international law  when a provincial court can assume
    jurisdiction over a claim. The Supreme Court reaffirmed that the governing test
    for the assumption of jurisdiction is the real and substantial connection
    test. Plaintiffs must show a real and substantial connection between the
    subject matter of their claim and the province in which they seek to litigate
    that claim. LeBel J., writing for the court, said that in a tort claim four
    factors can be considered presumptive connecting factors, which, unless
    rebutted, entitle a provincial court to assume jurisdiction over a dispute:

·

the defendant is domiciled or resident in the province;

·

the defendant carries on business in the province;

·

the tort was committed in the province; and

·

a contract connected with the dispute was made in the province.

[16]

The appellants submit that
Van Breda
should be applied to
    determine whether the Ontario Superior Court has jurisdiction under s. 21(1)
    over their tort claim against the federal Crown. Doing so, they contend, would
    give effect to the very purposes of s. 21(1): to limit or eliminate multiple
    proceedings and promote access to justice.

[17]

I do not accept the appellants submission. It is arguable that the
    appellants could have sued all defendants, including the three John Doe
    defendants, in the Federal Court in the light of s. 17(5)(b) of the
Federal
    Court Act
. Section 17(5)(b) gives the Federal Court concurrent original
    jurisdiction in proceedings in which relief is sought against any person for
    anything done or omitted to be done in the performance of the duties of that
    person as an officer, servant or agent of the Crown. But even if s. 17(5)(b)
    does not apply, the appellants claim may be one of those cases where, despite
    s. 21(1) of the
CLPA
, the federal Crown must be sued in the Federal
    Court and the three John Doe defendants in the Ontario Superior Court.

[18]

Even in
Van Breda
itself, LeBel J. was careful to note at para.
    68 that his comments about the development of the common law principles of the
    law of conflicts  that is, the development of the real and substantial
    connection test  are subject to provisions of specific statutes Section
    21(1) of the
CLPA
is a specific statutory provision that sets out a different
    test from
Van Breda
s real and substantial connection test. In short,
    the words of s. 21(1) and not
Van Breda
should be used to decide a
    provincial superior courts jurisdiction under the
CLPA
.

[19]

That
Van Breda
does not apply to the resolution of a provincial
    superior courts jurisdiction under s. 21(1) is evident from considering
Van
    Breda
s presumptive connecting factors. The first connecting factor is
    whether the defendant is domiciled or resident in the province. The head
    office of the federal Crown is in Ottawa and so it is domiciled in Ontario. If
Van Breda
applies, the Ontario Superior Court presumptively would have
    jurisdiction over every claim against the federal Crown. The second connecting
    factor is whether the defendant carries on business in the province. The federal
    Crown has a presence and numerous offices in every province in Canada. It can
    thus be said to carry on business in every province. Again, if
Van Breda
applies, presumptively every province in Canada would have jurisdiction over
    every claim against the federal Crown, no matter where that claim arose. These
    results would be inconsistent with the language and intent of s. 21(1).

[20]

The only
Van Breda
connecting factor that parallels s. 21(1) is
    the third  whether the tort was committed in the province. Whether the tort was
    committed in the province is similar to the province in which the claim
    arises. Under s. 21(1) of the
CLPA
,
the province in which the claim arises is the sole criterion or connecting
    factor that gives a provincial superior court jurisdiction over claims against
    the federal Crown. If we were to give effect to the appellants submission, we
    would have to add words to s. 21(1) that are not there.

[21]

The test under s. 21(1) is simply different from the test in
Van
    Breda
. The application of the real and substantial connection test to the
    federal Crown would lead to impractical results that do not take account of the
    language of the
CLPA
. I add that since
Van Breda
was decided in
    2012, courts have considered jurisdiction under s. 21(1) and have not applied
    the real and substantial connection test: see, for example,
David S.
    LaFlamme Construction Inc. v. Canada (Attorney General)
, 2014 ONCA 775, 34
    C.L.R. (4th) 187; and
Martell v. Canada (Attorney General)
, 2016 PECA 8.
    Therefore, I would reject the appellants submission that
Van Breda
applies to decide jurisdiction under s. 21(1) of the
CLPA
.

(3)

The Proper
    Interpretation of s. 21(1)

[22]

This courts decision in
David S. LaFlamme
, at para. 7, sets
    out the proper approach to deciding whether a provincial superior court has jurisdiction
    over a claim against the federal Crown:

The court is required to examine the facts surrounding the
    claim in the light of the elements of the alleged cause of action in order to
    decide where the substance of the claim arose.

[23]

The focus on the substance of the claim means that, in a tort action, a
    provinces superior court will not necessarily have jurisdiction over the claim
    simply because one of the alleged acts of negligence or one of the underlying
    facts took place in that province:
Rowe v. Canada (Attorney General)
(2004),186 O.A.C. 106 (C.A.), at para. 7. One has to look at where the accident
    and the main acts of negligence and damages occurred.

C.

Application of s. 21(1) of the
CLPA
to this Case

[24]

I do not think there can be any doubt that the substance of the appellants
    claim against the federal Crown arose in Afghanistan and not in Ontario.

[25]

For a cause of action in tort there must be an accident, a negligent act,
    and an injury. Here, the accident took place in Afghanistan and Captain Babington-Browne
    died tragically in Afghanistan.

[26]

Admittedly, the appellants did plead some negligent acts by the federal
    Crown that could have taken place in Ontario: failing to retain, engage, and
    use pilots with sufficient or appropriate expertise; failing to train employees
    and independent contractors appropriately; and failing to provide employees
    with appropriate first aid and first response training.

[27]

But the bulk of the alleged negligent acts that caused the helicopter
    crash took place in Afghanistan. They include: failing to maintain the landing
    zone; failing to ensure that the landing zone was in proper condition; failing
    to ensure that the landing zone was a proper dimension and surfaced with
    appropriate material; failing to implement appropriate procedures for the use,
    operation, maintenance, and emergency landing of the helicopter; failing to
    ensure that the appropriate equipment, including fire extinguishers and communication
    devices, was located in the landing zone; failure to ensure that the
    helicopters communication devices were in good and proper working condition;
    failure to ensure that the helicopter had sufficient, appropriate, or
    well-maintained crashworthy seats; failing to ensure that the employees and/or
    independent contractors were equipped with appropriate equipment, including eye
    protection; failing to ensure that the emergency equipment was in good and
    proper working condition; operating or assisting in the operation of the
    helicopter without appropriate communication devices for all passengers on
    board; becoming distracted during the operation of the helicopter; failing to
    use the proper and/or appropriate techniques in light of the environmental
    conditions and physical structure of the landing zone during the take-off of
    the helicopter; failing to take all appropriate steps to extricate the
    passengers from the helicopter, and so forth.

[28]

As this summary shows, the substance of the appellants claim did not arise
    in Ontario. Thus I agree with the motion judges ruling that the Ontario
    Superior Court has no jurisdiction over the appellants claim against the
    federal Crown.

D.

Conclusion

[29]

The appellants claim against the federal Crown did not arise in
    Ontario; it arose in Afghanistan. Under s. 21(1) of the
CLPA
, the
    Ontario Superior Court has no jurisdiction over this claim. I would dismiss the
    appeal with costs of $7,500 (inclusive of disbursements and applicable taxes),
    if demanded.

Released: July 8, 2016 (M.T.)

John Laskin J.A.

I agree. M. Tulloch J.A.

I agree. C.W. Hourigan J.A.

[1]
This provision allows dependents to sue in court for damages where a person is
    injured or killed because of the fault or neglect of another.

[2]
Under s. 23(1) of the
Crown Liability and
    Proceedings Act
, R.S.C. 1985, c. C-50.

[3]
The appellants have also sued ABC Inc., as a corporation that employed the
    three John Doe defendants in case they are not Crown employees, and NATO.
    Neither ABC Inc. nor NATO have been served with the claim.

[4]
The original amendment gave concurrent jurisdiction to county, district, and
    superior courts. In 2001, s. 21(1) was changed to its current wording by the
    Federal Law-Civil Law Harmonization Act, No. 1, S.C. 2001, c. 4, which gives
    concurrent jurisdiction only to provincial superior courts.

[5]
Section 101 states: The Parliament of Canada may, notwithstanding anything in
    this Act, from Time to Time provide for the Constitution, Maintenance, and
    Organization of a General Court of Appeal for Canada, and for the Establishment
    of any additional Courts for the better Administration of the Laws of Canada.


COURT OF APPEAL FOR ONTARIO

CITATION: Baradaran v. Alexanian, 2016 ONCA 533

DATE: 20160705

DOCKET: C61252

Rouleau, van Rensburg and Benotto JJ.A.

BETWEEN

Manoucher Baradaran

Plaintiff (Appellant)

and

Shahen A. Alexanian, Shahen A. Alexanian Law Firm,
Shahen Alexanian Professional Corporation

Defendants (Respondents)

Manoucher Baradaran, acting in person

Louis Century and Charles Sinclair, for the respondents

Heard: June 24, 2016

On appeal from the order of Justice Robert F. Goldstein
    of the Superior Court of Justice, dated October 14, 2015.

ENDORSEMENT

[1]

This is an appeal from an order striking certain
    paragraphs of a statement of claim.

[2]

The appellant commenced an action against the
    respondent Shahen Alexanian, a lawyer, and his law firm and professional
    corporation. The appellant claims damages for breach of certain service
    agreements under which he claims to be owed various fees for working on Mr. Alexanians
    client files. He also asserts claims for solicitors negligence in respect of
    five actions in the Superior Court.

[3]

The respondents moved to strike, without leave
    to amend, paragraphs 17 to 21 of the statement of claim. Each paragraph contained
    allegations of solicitors negligence in respect of a different underlying
    claim. The motion to strike was brought under rules 21.01(3)(d) and 25.11 of
    the
Rules of Civil Procedure
,
R.R.O. 1990, Reg. 194,
on the basis that
    the relevant paragraphs were frivolous and vexatious or an abuse of the process
    of the court. The motion was supported by a lengthy affidavit from Mr.
    Alexanian. The appellant filed a lengthy affidavit in response to the motion.

[4]

The motion judge granted the motion and struck
    the impugned paragraphs, without leave to amend. He found the paragraphs to be
    clearly vexatious and an abuse of process.

[5]

Paragraphs 17 and 18 contain allegations of solicitors
    negligence in respect of an action against a dentist and an action against a
    former lawyer. The actions were dismissed or struck as statute-barred, and the motion
    judge noted that the appellant had not consulted Mr. Alexanian until the
    claims were barred and that he insisted on going ahead in the face of Mr.
    Alexanians advice (that the claims were likely statute-barred and had no
    chance of success). Paragraph 19 claims solicitors negligence in an action
    claiming the return of a deposit on a time share property. The motion judge
    struck the paragraph which he characterized as alleging a failure to attend at
    trial, on the basis that the appellant had delivered a notice of intention to
    act in person. Paragraph 20 sought damages for solicitors negligence in a
    personal injury action alleging that an object was dropped on the appellant in
    the course of a flight. The action was dismissed for delay by the Registrar and
    then restored, after which Mr. Alexanian was served with a notice of change of
    lawyer. Paragraph 21 sought damages for solicitors negligence in respect of
    the appellants representation by Mr. Alexanian in an action against a
    travel agency claiming damages, among other things, for lost luggage. The
    motion judge struck paragraphs 20 and 21, stating that Mr. Alexanian issued the
    claims, pursued productions and had scheduled discoveries when the appellant
    sued him, and that he ceased work for obvious reasons. The motion judge noted
    that the claims were still outstanding.

[6]

The motion judge awarded substantial indemnity
    costs against the appellant in the sum of $11,008.87.

[7]

The appellant raises two main issues on appeal.
    First, he alleges bias based on certain earlier dealings with the motion judge,
    and the way in which the motion was handled. The appellant also asserts that
    the motion judge ignored evidence that supported his claim, and that he was
    prevented from directing the motion judge to such evidence because of the way
    the motion was conducted.

[8]

The respondents deny that there was bias on the
    part of the motion judge, and contend that the hearing proceeded in a manner
    that was fair to the appellant, because he had the opportunity to address all
    of the motion judges justifiable concerns about his pleading. The motion
    judges decision to strike the impugned paragraphs of the statement of claim were
    based on Mr. Alexanians affidavit evidence that demonstrated that the claims
    against him were frivolous and an abuse of the process of the court. The court
    was entitled to receive affidavit evidence from both parties, and to prefer Mr.
    Alexanians evidence over that of the appellant.

[9]

For the reasons that follow, the appeal is
    allowed.

[10]

First, the motion judge erred in approaching the
    motion, which was a motion to strike pleadings under rules 21.01(3)(d) and
    25.11, as though he were determining a motion for summary judgment under rule
    20. While the motion judge could consider evidence on such a motion, the
    evidence on which he based his decision went to the merits of the claims. The
    motion judge accepted the solicitors evidence, that the appellant had been
    advised that two of the actions the respondent had been retained to litigate
    were ill-conceived and he accepted the solicitors account of what transpired
    in his handling of all of the actions. In doing so, the motion judge did not
    address obvious inconsistencies in the evidence, including the appellants
    assertion in his own affidavit that Mr. Alexanian said he had a great
    chance to win [the] claims. From comments in the transcript it is apparent
    that the motion judge considered the solicitors evidence to be uncontradicted.

[11]

The propriety of the use of rules 21 and 25 was
    not addressed by the motion judge in the court below.

[12]

In this court, the respondents sought to justify
    the decision of the motion judge as being properly made under rule 25.11. First,
    the respondents asserted that, since rule 25.11 permitted evidence to be filed
    on such a motion, the judge did not err in considering such evidence in making
    his decision, even if the evidence he considered went to the merits. Second,
    the respondents argued that the motion judge could have converted the pleadings
    motion into a motion for summary judgment and that no prejudice resulted to the
    appellant because he knew the issues he had to meet.

[13]

We reject these
    arguments.

[14]

The purpose of a motion to strike paragraphs in
    a statement of claim is to weed out claims that have no possibility of success.
    Pleadings motions are brought early in the litigation and before the opposing
    party has pleaded in response. When a pleading is struck, the court must
    consider whether to grant leave to amend. A summary judgment motion, by
    contrast, can only be brought after pleadings are exchanged: rule 20.01(3).
    This is for good reason. Summary judgment disposes of the merits of a claim or
    defence.

[15]

The court will only strike out a claim on the basis that it is
    frivolous or vexatious or an abuse of the process of the court, in the clearest
    of cases and where it is plain and obvious that the case cannot succeed. One
    must guard against converting such motions into summary judgment motions:
Miguna
    v. Toronto Police Services Board
, 2008 ONCA 799, 243 O.A.C. 62, at paras.
    16 and 21. In that case, Blair J.A. addressed the very point made by the
    respondents  that the motion judge was entitled to evaluate the merits of the
    appellants claims because affidavit evidence was admissible on the motion. He
    stated, at para. 34:

Evidence is admissible in relation to a rule 25.11 motion
    or in relation to the "frivolous and vexatious" aspect of a motion
    under rule 21.01(3)(d)
. It does not
    follow, however, that such a motion may be turned into an evidentiary
    disposition. The test remains: is it plain and obvious that the claim cannot
    succeed? The test is not whether it is unlikely the claim will succeed. Nor is
    the process one of weighing and assessing the evidence against the allegations
    as if the motion were a trial or a request for summary judgment.

[16]

This means that, while evidence is admissible in
    a motion under rules 25.11 and 21.01(3)(d), the evidence must be relevant to,
    and considered for the purposes of, the motion that is before the court. In
    other words, the ability to file evidence in a pleadings motion does not change
    the character of the motion, which is not to determine the merits, but to
    decide whether the pleading should be struck, as having no chance of success
    because it is frivolous and vexatious or an abuse of process. For these
    reasons, we reject the respondents contention that the motion judge was acting
    within the proper scope of rules 21.01(3)(d) and 25.11 in striking the relevant
    paragraphs of the statement of claim based on Mr. Alexanians affidavit
    evidence.

[17]

We also reject the respondents alternative
    argument that the motion judge was entitled to convert the motion to a summary
    judgment motion, where the appellant had the opportunity to tender evidence and
    to respond to the motion judges questions about the merits of his claim. Rule
    20 permits a summary judgment motion to be brought only after pleadings have
    been exchanged: in this case no statement of defence had been delivered. Further,
    the appellant was entitled to rely on the notice of motion, and the relief
    sought by the respondents, which was to strike certain paragraphs in his
    pleading, and not for summary judgment. Finally, certain interchanges in the
    transcript show that the appellant was taken by surprise at the motion judges
    approach, when he was challenged on the merits of the claim. And, to the extent
    that the motion judge considered the merits, he was wrong to state that there
    was no evidence to contradict that of Mr. Alexanian.

[18]

It is clear from both the endorsement and the
    transcript of the hearing before the motion judge, that he approached this case
    as a summary judgment motion. While he used the term vexatious liberally in
    both his endorsement and his comments in court, and labeled the paragraphs in
    the pleading as well as the entire action as vexatious and an abuse of process,
    the motion judge conducted a merits-based analysis of the evidence. Indeed, he
    commented at the end of his endorsement that the appellants claim was
    entirely without merit. Further, the fact that the motion judge struck the
    paragraphs without leave to amend, without giving proper or any consideration
    to whether the claims were capable of being amended, reinforces the conclusion
    that he approached the motion as a summary judgment motion and not as a motion
    respecting pleadings.

[19]

Finally, we note that there were issues raised
    by the appellant about bias, and his concerns with respect to how the matter
    proceeded and comments made at the hearing. In light of our decision, we need
    not deal with that ground of appeal.

[20]

For these reasons the appeal is allowed. The
    order striking paragraphs of the appellants statement of claim is set aside,
    as is the order of the motion judge granting substantial indemnity costs
    against the appellant. The respondents will have 20 days to deliver their statement
    of defence. There will be no costs of the motion at first instance. Costs of
    the appeal are fixed in the sum of $2,000, inclusive of disbursements and
    applicable taxes, payable by the respondents to the appellant.

Paul Rouleau J.A.

K. van Rensburg J.A.

M.L. Benotto J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Collins v. Ontario, 2016 ONCA 538

DATE: 20160706

DOCKET: M46011 (M45970) and M46045 (C61398)

MacPherson, Cronk and Benotto JJ.A.

BETWEEN

R. Maxine Collins

Appellant (Moving Party)

and

Her Majesty the Queen in Right of Ontario

Respondent (Responding Party)

AND BETWEEN

R. Maxine Collins

Appellant (Moving Party)

and

Her Majesty the Queen in Right of Canada

Respondent (Responding Party)

R. Maxine Collins, acting in person

Ayesha Laldin, for the responding party Her Majesty the Queen in
    Right of Canada

Daniel Mayer, for the responding party Attorney General of
    Ontario

Heard: July 5, 2016

ENDORSEMENT

[1]

The moving party brings these motions to set aside the decisions of
    Lauwers J.A. (in chambers) dated January 20, 2016 and Strathy C.J.O. (in
    chambers) dated January 25, 2016.

[2]

In his decision, Lauwers J.A. held that the Court of Appeal did not have
    jurisdiction to issue an originating process such as a Notice of Application
    and, therefore, the moving party could only appeal a decision of a lower court.

[3]

In his decision, Strathy C.J.O. agreed with Lauwers J.A.s decision and
    granted the appellant an extension of time to April 8, 2016 to perfect her
    appeal.

[4]

The moving party appeals both decisions, principally on the basis that
    Lauwers J.A.s decision was wrong in law.

[5]

We agree with Lauwers J.A.s decision and we do so for the reasons he
    gave.

[6]

It follows that we also agree with Strathy C.J.O.s decision. The appellant
    has taken no steps to perfect her appeal.

[7]

The motion is dismissed. The respondents are entitled to their costs of
    the appeal fixed at $1000 each, inclusive of disbursements and HST.

J.C. MacPherson J.A.

E.A. Cronk J.A.

M.L. Benotto J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Damallie v. Ping, 2016 ONCA 603

DATE: 20160728

DOCKET: M46381 & M46729

Gillese J.A. (In Chambers)

BETWEEN

Clifton Damallie

Plaintiff (Moving Party/
Responding Party by way of cross motion)

and

Dr. Peony Ping

Defendant (Responding Party/
Moving Party by way of cross-motion)

Clifton Damallie, acting in person

Jeremy Opolsky, appearing as
amicus

Julia Lauwers, for the responding party/moving party by way
    of cross motion

Heard: July 27, 2016

ENDORSEMENT

[1]

Mr. Damallie moves for an order dismissing the orders of the Registrar
    dated August 12, 2015, and December 4, 2015.

[2]

Dr. Peony Ping is the responding party to the motion. She brings a
    cross-motion asking that this proceeding be referred to a panel of the Court of
    Appeal (the Panel) for a determination under rule 2.1 of the
Rules of
    Civil Procedure
, R.R.O. 1990, Reg. 194, that the proceeding is, on its
    face, frivolous, vexatious and an abuse of process.  Dr. Ping also asks for an
    order staying Mr. Damallies motion and any other motions in this proceeding
    pursuant to s. 106 of the
Courts of Justice Act
, R.S.O. 1990, c. C.43,
    pending the outcome of the Panels determination under rule 2.1.

[3]

For the reasons that follow, the cross-motion is granted and Mr.
    Damallies motion is stayed pending the outcome of the Panels determination.

BACKGROUND IN BRIEF

[4]

Dr. Ping is a dentist in good standing with the Royal College of Dental
    Surgeons of Ontario. Mr. Damallie was a patient of Dr. Ping from June 9, 2011,
    to March 22, 2012.

[5]

On September 17, 2012, Mr. Damallie began an action against Dr. Ping in
    the Small Claims Court in Toronto. On July 4, 2013, Deputy Judge Shapiro
    dismissed Mr. Damallies claim (the Dismissal).

[6]

A very abbreviated version of what transpired after the Dismissal
    follows.

[7]

On January 8, 2014, Mr. Damallie brought a motion in the Divisional
    Court, in which he sought an extension of time to file a notice of appeal
    against the Dismissal. By order dated January 8, 2014, a single judge of the
    Divisional Court dismissed the motion (the First Divisional Court order). In
    thoughtful and thorough reasons, the court explained that the proposed appeal
    had no merit.

[8]

Mr. Damallie moved to set aside the First Divisional Court order. By
    order dated September 24, 2014, a three-judge panel of the Divisional Court
    dismissed the motion and upheld the First Divisional Court order (the Second
    Divisional Court order). Again, the court gave thorough and sound reasons for
    why the proposed appeal should not be permitted to proceed and why there was no
    error in the First Divisional Court order.

[9]

By notice of motion dated September 29, 2014, Mr. Damallie indicated
    that he would make a motion in this court seeking leave to appeal the Second
    Divisional Court order (the Originating CA Motion).

[10]

On December 15, 2014, the Registrar notified Mr. Damallie that she would
    dismiss the Originating CA Motion for delay unless he filed his motion record
    and factum in accordance with the
Rules
by December 30, 2014.

[11]

Mr. Damallie did not file the requisite materials.

[12]

Instead, in March of 2015, Mr. Damallie brought a motion for an
    extension of time to file the requisite materials. That motion was dismissed by
    court order dated April 8, 2015 (the April 2015 order).

[13]

Mr. Damallie then filed a notice of motion asking that a panel of this
    court review the April 2015 order. However, he failed to file the necessary
    documents in support of that motion. Again, the Registrar advised that his
    motion would be dismissed for delay if he did not file the documents by a
    specified date. Again, instead of meeting that requirement, he filed another
    motion in which he sought an extension of time to file the documents. That motion
    was dismissed. Again, he brought a motion seeking a review of the dismissal. But
    he did not file the requisite materials so the Registrar notified him of her
    intention to dismiss for delay. So Mr. Damallie brought another motion.

[14]

And so the pattern has continued for the past eighteen months, with Mr.
    Damallie filing notice of motion after notice of motion, each one challenging a
    decision this court has rendered in this matter but failing to provide the
    requisite documentation.

[15]

By order dated April 14, 2016, the Registrar dismissed the Originating
    CA Motion for delay (the Order). This had the effect of dismissing the
    underlying motion for leave to appeal to this court.

[16]

Nonetheless, Mr. Damallie continues to bring motions in this proceeding.
    He frequently fails to serve Dr. Ping with the motion materials and fails to inform
    her of the dates on which the motions are scheduled to be heard.

ANALYSIS

[17]

Through her cross-motion, Dr. Ping asks for this courts help in ending
    this cycle. She asks that this matter be referred to a panel of the court (the
    Panel) for a determination under rule 2.1 of the
Rules
. Rule 2.1.01(1)
    gives the court the power to stay or dismiss a proceeding if the proceeding
    appears on its face to be frivolous or vexatious or otherwise an abuse of the
    process of the court.

[18]

Mr. Damallie voiced two concerns in respect of the cross-motion. First, he
    asked whether the Panel would address his concerns relating to the costs orders
    made against him in the administrative dismissals made by the Registrar.
[1]
He wants those costs orders to be waived. Second, Mr. Damallie asked whether
    he would be given a fair chance to express his reasons for believing that the
    Court of Appeal should hear his proposed appeal.

[19]

Amicus
submitted that this court should not entertain the
    cross-motion. He points out that in a letter dated January 12, 2016, counsel
    for Dr. Ping wrote to the Registrar asking for an order from the court pursuant
    to rule 2.1.01(6). He suggests that Dr. Ping should continue to wait and see
    what might transpire as a result of that request.

[20]

I see no reason why the cross-motion should not be entertained by this
    court.  There are very few reported decisions in which this court has stayed or
    dismissed a proceeding under rule 2.1: see e.g.
Hoang v. Mann Engineering
    Ltd.
, 2015 ONCA 838; and
Gallos v. Toronto (City)
, 2014 ONCA 818.  I
    see nothing in those decisions to suggest that the matter cannot be brought to
    the courts attention by means of a motion such as that brought today by Dr.
    Ping.

[21]

Amicus
correctly points out that rule 2.1.01(6) contemplates that
    a party to a proceeding may file with the registrar a written request for an
    order under subrule (1). However, this provision uses the word may,
    indicating that it is permissive.  Thus, I do not see it as precluding a party
    from bringing a motion such as that which Dr. Ping brings today.

[22]

It has been many months since counsel for Dr. Ping sent a written
    request to the Registrar and there have been countless motions since that time,
    many of which, in my view, were moot. The Order had the effect of dismissing
    the underlying motion for leave to appeal to this court. As all of the
    outstanding motions brought by Mr. Damallie relate to the underlying motion, in
    my view, the Order rendered those motions moot.  And yet, the motions continue
    to be brought and heard.  There must be some method by which a responding party
    can enlist the courts aid in coming to grips with the situation. A motion of
    this sort provides such an avenue.

[23]

I turn now to the merits of the cross-motion.

[24]

I have reviewed many of the notices of motion that Mr. Damallie has
    filed in this proceeding in this court.  Apart from the fact that most now
    appear to be moot, for the reasons already given, the notices of motion also appear
    to be simply repeated attempts to re-argue issues that the court has already
    determined. They consist of bald assertions that the decision he seeks to
    challenge is incorrect.  On the face of the notices of motion, they appear to
    be frivolous, vexatious and an abuse of process.

[25]

Further, the Divisional Court has twice considered the proposed appeal
    and found there was no merit to it. In many of the decisions rendered by this
    court on Mr. Damallies motions, the court has also referred to the absence of
    merit to the proposed appeal. See, for example, the reasons for decision dated
    February 17, 2016, of Hourigan J.A (M45889).

[26]

I have considered Mr. Damallies concerns and am satisfied that he will
    be given the opportunity to be fairly heard, including on the matter of the
    costs orders against him, if I refer this proceeding to a Panel.

[27]

Rule 2.1.01(3) sets out a procedure that the court is required to follow
    when it is considering making an order under subrule (1), unless it orders
    otherwise. It provides that the plaintiff or applicant (in this case, Mr.
    Damallie) is to be given the opportunity to file with the court a written
    submission. Thus, Mr. Damallie should have the opportunity to put forward the
    matters that he wishes the Panel to take into consideration, including, if he
    wishes, the matter of the costs orders made against him in this proceeding.

[28]

For the convenience of all, rule 2.1 of the
Rules
is set out in
    full in Schedule A to these reasons.

DISPOSITION

[29]

For these reasons, the cross-motion is granted. An order shall go in
    accordance with the draft order located at tab 27 of the Motion Record for the
    cross-motion, with the exception of para. 4. Mr. Damallies present and other
    motions in this proceeding are stayed pending the Panels determination under rule
    2.1. Costs of todays motion and cross-motion are reserved to the Panel.

E.E. Gillese J.A.

SCHEDULE
    A

[30]

Rule 2.1 of the
Rules of Civil Procedure
provides:

2.1.01

(1)
The court may, on its own
    initiative, stay or dismiss a proceeding if the proceeding appears on its face
    to be frivolous or vexatious or otherwise an abuse of the process of the court.

(2)
The court may make a determination under subrule (1) in a summary manner,
    subject to the procedures set out in this rule.

(3)
Unless the court orders otherwise, an order
    under subrule (1) shall be made on the basis of written submissions, if any, in
    accordance with the following procedures:

1. The court shall direct the registrar to give
    notice (Form 2.1A) to the plaintiff or applicant, as the case may be, that the
    court is considering making the order.

2. The plaintiff or applicant may, within 15 days
    after receiving the notice, file with the court a written submission, no more
    than 10 pages in length, responding to the notice.

3. If the plaintiff or applicant does not file a
    written submission that complies with paragraph 2, the court may make the order
    without any further notice to the plaintiff or applicant or to any other party.

4. If the plaintiff or applicant files a written
    submission that complies with paragraph 2, the court may direct the registrar
    to give a copy of the submission to any other party.

5. A party who receives a copy of the plaintiffs
    or applicants submission may, within 10 days after receiving the copy, file
    with the court a written submission, no more than 10 pages in length,
    responding to the plaintiffs or applicants submission, and shall give a copy
    of the responding submission to the plaintiff or applicant and, on the request
    of any other party, to that party.

(4)
A document required under subrule (3) to be
    given to a party shall be mailed in the manner described in subclause 16.01 (4)
    (b) (i), and is deemed to have been received on the fifth day after it is
    mailed.

(5)
The registrar shall serve a copy of the order
    by mail on the plaintiff or applicant as soon as possible after the order is
    made.

(6)
Any party to
    the proceeding may file with the registrar a written request for an order under
    subrule (1).

(7)
If the registrar becomes aware that a
    proceeding could be the subject of an order under subrule (1), the registrar
    shall notify the court.

2.1.02
(1)
The court may, on its own
    initiative, stay or dismiss a motion if the motion appears on its face to be
    frivolous or vexatious or otherwise an abuse of the process of the court. O.
    Reg. 43/14, s. 1.

(2)
Subrules 2.1.01 (2) to (7) apply, with
    necessary modifications, to the making of an order under subrule (1) and, for
    the purpose,

(a) a reference to the proceeding shall be read as
    a reference to the motion; and

(b) a reference to the plaintiff or applicant
    shall be read as a reference to the moving party.

(3)
On making an order under subrule (1), the
    court may also make an order under rule 37.16 prohibiting the moving party from
    making further motions in a proceeding without leave.

2.1.03
(1)
If the court determines that a person who is subject to an order under subsection
    140 (1) of the
Courts of Justice Act
has instituted or continued a
    proceeding without the order having been rescinded or leave granted for the
    proceeding to be instituted or continued, the court shall make an order staying
    or dismissing the proceeding.

(2)
Any party to the proceeding may file with the
    registrar a written request for an order under subrule (1).

(3)
An order under subrule (1) may be made
    without notice, but the registrar shall serve a copy of the order by mail on
    every party to the proceeding for whom an address is provided in the
    originating process as soon as possible after the order is made.

[1]

Mr. Damallies notice of motion before the court today refers
    to the administrative dismissal orders as being dated August 12, 2015, and
    December 4, 2015. Apart from a brief affidavit, he did not file supporting materials
    for the motion. In the materials filed by the responding party in support of
    its cross-motion, I located the Registrars dismissal order dated December 4,
    2015. It dismissed one of Mr. Damallies motions (not the Originating CA
    Motion) for delay with costs fixed at $750. I could not locate an
    administrative dismissal order dated August 12, 2015. However, the Order - which
    dismissed the Originating CA Motion  did dismiss for delay with costs fixed at
    $750.