COURT OF APPEAL FOR ONTARIO

CITATION: Shinder v. Shinder, 2017 ONCA 822

DATE: 20171025

DOCKET: M48418 & M48440 (C64169)

Nordheimer J.A. (In Chambers)

BETWEEN

Randi Joy Cogan Shinder

Applicant (Respondent)

(Responding Party/Moving Party in M48440)

and

Neil Allen Shinder

Respondent (Appellant)

(Responding Party/Moving Party in M48418)

and

Solomon Shinder

Respondent

(Responding Party)

Harold Niman & Venessa Amyot, for the
    appellant/moving party in M48440

Jaret N. Moldaver, for the respondent/moving party in
    M48418

Erin Crawford, for the responding party Solomon Shinder

Heard:  October 24, 2017

ENDORSEMENT

[1]

Neil Shinder appeals from the order of J. Wilson J. dated July 13, 2017
    that granted what I would characterize as partial summary judgment in favour of
    Randi Shinder.  Because of uncertainty over whether the order in question is a
    final or interlocutory order, Neil Shinder filed a Notice of Appeal in this
    court and a motion for leave to appeal in the Divisional Court.  The appeal in
    this court has been perfected and is scheduled to be heard on January 25,
    2018.  The motion for leave to appeal is scheduled to be heard in writing on
    October 27, 2017.

[2]

Neil Shinder now brings a motion for directions in which he seeks an
    order that the motions for leave to appeal to the Divisional Court brought by
    the Respondent/Appellant and the Respondent, Sol Shinder, be heard by the Court
    of Appeal.  Randi Shinder opposes that relief and brings a cross-motion to
    adjourn the hearing of the appeal and for an extension of time to file her
    responding materials.

[3]

There are two problems with the relief that the appellant seeks.  First,
    this court does not have jurisdiction to determine a motion for leave to appeal
    that is brought before the Divisional Court.  Section 6(2) of the
Courts of
    Justice Act
, R.S.O. 1990, c. C.43 permits this court to hear an appeal
    that lies to the Divisional Court, but only where there is an appeal in the
    same proceeding in this court.  However, an appeal does not lie to the
    Divisional Court unless and until leave to appeal has been granted:
Waldman
    v. Thomson Reuters Canada Ltd
., 2015 ONCA 53.

[4]

Second, even if I had jurisdiction to transfer the matter from the Divisional
    Court to this court, in order to make that order, I would have to decide that
    the order in question is a final order and properly appealed to this court.  In
    my view, it is not appropriate for a motions judge to make that determination.
    That issue, which is squarely raised by this motion, is a question of
    jurisdiction and that question is properly determined by the panel hearing the
    appeal or, alternatively, by a panel on a motion to quash, if such a motion is
    brought by the respondent.

[5]

I have been referred to the endorsement of Epstein J.A. in
Klasios
    v. Klasios
, (May 1, 2015), Toronto, M44974 (Ont. C.A.).  It is argued that
    that decision concluded that a motions judge could determine a jurisdiction
    issue.  I do not agree, at least in respect of the issue that is presented here.
    Justice Epstein was addressing whether an extension of time to file a Notice of
    Appeal should be granted.  Because of certain concessions that appear to have
    been made by counsel in that case, Epstein J.A. concluded that the order in
    question was clearly interlocutory and thus an extension of time to appeal ought
    not to be granted since the matter was not properly before this court.  I note
    that Epstein J.A. said, at the outset of her endorsement at para. 2: I do not
    have jurisdiction to decide the jurisdiction question.

[6]

In reaching the conclusion that I have, I am mindful of the costs that
    parties can incur when confusion arises over the proper appeal route.  This is
    not the first time that parties have had to launch proceedings both in this
    court and in the Divisional Court because of the uncertainty over whether an
    order is final or interlocutory.  This problem is inherent when the appeal
    route depends on a distinction between final and interlocutory orders.  It is a
    problem that has plagued both judges and lawyers for a long time and which was aptly
    captured by Laskin J.A. in
Capital Gains Income Streams Corp. v. Merrill
    Lynch Canada Inc.
, 2007 ONCA 497, 87 O.R. (3d) 443, where he said, at
    para. 36:

The distinction between final and interlocutory orders bedevils
    this court. Far too much ink has been spilled over the pages of the Ontario
    Reports, grappling with this distinction. Even when the parties themselves do
    not raise the issue, the court itself often feels compelled to do so

as it did in this case

because the court's
    jurisdiction to hear an appeal turns on the distinction: final orders are
    appealable as of right to this court; interlocutory orders are not.

[7]

The problem also drew the attention of the Honourable Colter Osborne in
    his Civil Justice Reform Project.  He recommended that the Civil Rules
    Committee consider the issue and, hopefully, make recommendations to the
    Attorney General for a legislative amendment to the
Courts of Justice Act
that would jettison the final/interlocutory distinction (Honourable Coulter
    A. Osborne,
Civil Justice Reform Project: Summary of Findings &
    Recommendations
(November 2007), at p. 105).  That has not happened.

[8]

Unless the problem is addressed in some such fashion, this situation
    will continue to occur and parties will be put to avoidable expense.  None of
    that changes the fact, however, that it is a panel of this court that must
    determine the jurisdiction issue, not a motions judge.  The decision of a motions
    judge is not binding on a panel:
Courts of Justice Act
, s. 7(5).

[9]

The motion by the appellant for directions is dismissed.

[10]

In
    terms of the cross-motion, the appellant does not object to an extension of
    time for the respondent to file her responding materials.  The respondents
    request for a two-week extension is granted.

[11]

The
    respondent also asked for the hearing of the appeal to be adjourned because her
    counsel may be called to trial in Brampton during that time.  The appellant
    objected to that request.  I will not adjourn the appeal for that reason.  If
    counsel is called to trial, I fully expect that the presiding judge will grant
    him a one-day absence in order for him to attend in this court to argue the
    appeal.

[12]

The
    parties are agreed that the costs of these motions should be fixed at $5,000.
    They do not agree, however, on their disposition.  The main issue raised by
    this motion turns on whether the appellant is properly before this court for
    his appeal.  Consequently, I would fix the costs of these motions at $5,000,
    inclusive of disbursements and HST, but leave the disposition of those costs to
    the panel hearing the appeal.

I.V.B. Nordheimer
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Sickinger v. Sickinger, 2017 ONCA 760

DATE: 20171002

DOCKET: M48230 (C63525)

Brown J.A. (In Chambers)

BETWEEN

Ralph Thomas James Sickinger

Moving Party

and

Penelope Kay Sickinger

Respondent

Brian Ludmer, for the moving party, Ralph Thomas James Sickinger

Glenn Smith, for the responding party, Penelope Kay Sickinger

Heard: September 20, 2017

ENDORSEMENT

I.        OVERVIEW

[1]

In this long-running family law litigation, the moving party, Ralph
    Sickinger, moves to set aside the May 23, 2017 administrative dismissal of his
    appeal for delay (the Dismissal Order). For the reasons that follow, I
    dismiss his motion.

II.       PROCEDURAL HISTORY

[2]

Ralph and Penelope Sickinger married in 1991. They have three children,
    now ranging in age from 17 to 23 years old. They entered into a separation
    agreement in 2007; a divorce was granted in 2008.

[3]

In 2009, Mr. Sickinger brought a motion to change. Prior to the trial of
    the motion, he was deemed to have filed an assignment in bankruptcy. A seven
    day trial took place in late 2011 and early 2012, resulting in the March 30,
    2012 final order of Perkins J.

[4]

That order was predicated on all three children residing with Ms.
    Sickinger. In 2013, the two oldest children changed their residence and stopped
    living with their mother.

[5]

In April, 2014, Mr. Sickinger commenced the present motion to change.
    Extensive case conferencing ensued. Starting at least with the December 19,
    2014 case conference before Kruzick J., the case management judges directed the
    motion for change to be decided on a one-day motion, not at a trial.

[6]

In November, 2014, Mr. Sickinger was discharged from bankruptcy. Around
    the same time Ms. Sickinger went on social assistance.

[7]

In her January 25, 2016 endorsement, Backhouse J. noted that Mr.
    Sickinger was not paying the required child support. She wrote: If payment
    does not resume forthwith, then this Motion to Change should be dismissed.

[8]

At the August 15, 2016 conference, the court ordered Mr. Sickinger to
    provide stipulated disclosure by October 14, 2016. Hood J. noted that much of
    the disclosure was the same as that previously ordered by case management
    judges in July and October, 2014, which Mr. Sickinger had not provided.

[9]

On December 13, 2016, Mr. Sickinger sought an adjournment of his motion
    to change on the basis that he would be physically unable to attend and other
    business related reasons. In her endorsement of that date, Harvison-Young J.
    noted Mr. Sickinger had only made three monthly support payments since the
    January 25, 2016 endorsement. Harvison-Young J. adjourned the hearing of Mr.
    Sickingers motion to change until December 22, 2016 to give him a last chance
    to comply with the outstanding court orders.

[10]

On December 22, 2016 Mr. Sickinger sought yet another adjournment of
his
motion to change. Glustein J. adjourned the motion to Febrary 28, 2107, but
    made the hearing peremptory to Mr. Sickinger. He also ordered Mr. Sickinger, on
    a peremptory basis, to serve any further affidavit material by January 16, 2017
    and stipulated no further affidavit material could be filed thereafter.

[11]

The motion to change initiated by Mr. Sickinger in April 2014 finally
    was heard almost three years later on February 28, 2017 by McWatt J., who
    dismissed the motion. In her endorsement dated March 6, 2017, McWatt J. wrote:

First and foremost, [Mr. Sickinger] has not produced his 2015
    Income Tax Return or his 2015 Notice of Assessment and there is no valid reason
    for it. He has not produced his 2014 Income Tax return and Notice of
    Assessment. He has not produced any income tax returns at all.

[12]

McWatt J. also found Mr. Sickinger had not demonstrated a material
    change since the final order of Perkins J. She terminated the child support for
    the two oldest children as of December 19, 2014; both had stopped living with
    their mother in 2013. McWatt J. increased the child support payable by the
    father for the third child effective June 2016 due to Mr. Sickingers increase
    in income. She also fixed Mr. Sickingers arrears of child and spousal support
    at $83,544.

III.      APPLICABLE TEST

[13]

The overriding consideration on a motion to set aside an order
    dismissing an appeal is the justice of the case, which entails a consideration
    of the merits of the appeal:
Akagi v. Synergy
Group
(2000) Inc.
, 2014 ONCA 731,
    at para. 8. In addition, factors analogous to those typically considered
    on a motion to extend the time to appeal inform a request to set aside the
    administrative dismissal of an appeal: (i) the explanation for not perfecting
    the appeal within the time stipulated by the rules; (ii) the length of and
    explanation for the delay in moving to set aside the administrative dismissal;
    and (iii) prejudice to the respondent.

[14]

More justification must be shown by a party moving to aside an
    administrative dismissal of an appeal than would have been required had the
    party earlier availed itself of its rights to move for an extension of time to
    perfect the appeal:
Langer v. Yorkton Securities Inc.
(1986), 57 O.R.
    (2d) 555 (C.A.), at para. 14.

IV.      APPLICATION OF THE TEST

Mr. Sickingers explanation for not perfecting his appeal in
    time

[15]

Mr. Sickinger filed his notice of appeal of the March 6, 2017 order of
    McWatt J. on March 22, 2017, together with a certificate respecting evidence.

[16]

The registrar sent the parties an April 24, 2017 Notice of Intention to
    Dismiss Appeal for Delay advising the appeal would be dismissed unless
    perfected by May 16, 2017. The residential address to which the registrar sent
    the notice was that listed by Mr. Sickinger on his present motion.

[17]

Mr. Sickinger did not perfect his appeal. The registrar issued the
    Dismissal Order.

[18]

As I read his affidavit, Mr. Sickinger offers two explanations about why
    he did not perfect his appeal in time. First, although he does not have a
    solicitor of record, he has retained a lawyer, Mr. Ludmer, to assist him with
    the appeal on a limited mandate. He contends that Mr. Ludmers trial schedule
    in March and May of this year prevented him from reviewing Mr. Sickingers
    appeal materials.

[19]

I do not accept that explanation. It inaccurately suggests Mr.
    Sickingers appeal materials were ready this past spring. However, in his
    August 18, 2017 affidavit Mr. Sickinger deposed that his appeal book and factum
    had not yet been reviewed by Mr. Ludmer. At the hearing of this motion, Mr.
    Ludmer submitted Mr. Sickinger required a further 10 business days to finalize
    his appeal materials. The record strongly suggests Mr. Sickinger is delaying
    the preparation of the materials needed to perfect his appeal.

[20]

The second explanation Mr. Sickinger advances for not perfecting in time
    is that he never received the registrars Notice of Intention to Dismiss for
    Delay. That position is difficult to reconcile with his statements that he
    asked Mr. Ludmers staff in April and May of this year to ascertain the status
    of a notice of approaching dismissal. It is clear from this evidence that Mr.
    Sickinger was fully aware of his obligation to perfect the appeal in a timely
    fashion and the possibility of its dismissal for delay.

[21]

In any event, as a result of inquiries made by Mr. Ludmers staff Mr.
    Sickinger knew by May 19, 2017 that a notice of intention to dismiss had been issued
    by the court requiring perfection of his appeal by May 16. Consequently, Mr.
    Sickinger knew a week before the May 23 Dismissal Order that his appeal was in
    jeopardy, yet he did not try to perfect it.

Mr. Sickingers explanation for not moving quickly to set
    aside the appeals dismissal

[22]

Mr. Sickingers appeal was dismissed on May 23, 2017. He did not file
    his motion to set aside the Dismissal Order until three months later on August
    24, 2017. He offers several reasons for the delay.

[23]

First, Mr. Sickinger deposes that upon learning his appeal would be
    dismissed, he sought Ms. Sickingers consent to an extension of time to
    perfect. On May 29, he learned she would not consent. He then decided to bring
    a motion to extend the time to perfect. He delayed preparing a notice of motion
    to extend until June 14, returnable on June 29; it was served on Ms.
    Sickingers agent on June 16, 2017. Mr. Ludmers office then notified Ms.
    Sickinger on June 26 that the motion would not be proceeding.  Mr. Sickinger
    does not explain why he abandoned his motion to extend.

[24]

Second, Mr. Sickinger suggested in his affidavit that draft appeal
    materials were ready for Mr. Ludmers review in August. Mr. Sickinger provided
    no explanation why they were not ready earlier and, for the reasons discussed
    earlier, I do not accept Mr. Sickingers suggestion that the materials were
    ready.

[25]

Third, in her March 6, 2017 endorsement McWatt J. called on the parties
    to file cost submissions. She released her costs reasons on May 12, 2017. Mr.
    Ludmer deposes he wants to appeal the costs order. He contends he cannot
    perfect his appeal of the March 6, 2017 order until the costs order has been
    taken out. He further deposes that as of August 18, 2017 the costs order had
    not been issued by the court.

[26]

That is not the case. The May 12, 2017 costs order of McWatt J. was
    issued on June 26, 2107. A July 6, 2017 email from Ms. Sickingers agent to Mr.
    Sickinger sent the issued order to Mr. Sickinger.

[27]

Taken together, these three reasons hold no water. Instead, they disclose
    a persistent strategy of foot-dragging by Mr. Sickinger. I conclude Mr.
    Sickinger has not provided a reasonable explanation for his delay to move to
    set aside the Dismissal Order.

The merits of the appeal

[28]

Mr. Sickingers notice of appeal and affidavit in support of his motion
    to set aside disclose four main grounds of appeal: (i) he was denied procedural
    fairness but not having a right to file reply evidence on a motion to change
    heard solely on affidavit evidence; (ii) the children should have been represented
    on the motion to change; (iii) the motion judge failed to consider all relevant
    factors with respect to the parties respective support obligations; and (iv)
    the motion judge failed to render sufficient reasons that would permit
    appellate review.

[29]

Based on the record before me, Mr. Sickingers grounds of appeal have
    little merit:

(i)           The
    December 22, 2016 endorsement of Glustein J. required all affidavits to be
    filed by January 16, 2017. No appeal was taken from that order. The peremptory
    nature of the order is quite understandable in light of Mr. Sickingers three-year
    delay in bringing on his own motion to change;

(ii)          Two
    of the children are now adults. They have not made any submissions on this
    motion that their rights were prejudiced by the March 6, 2017 final order;

(iii)         Mr.
    Sickingers assertion that the motion judge failed to consider all relevant
    factors with respect to the parties respective support obligations lacks
    details and evidentiary support. In making her order, McWatt J. relied, in part,
    on Mr. Sickingers failure to provide his 2014 and 2015 income tax information.
    It is telling Mr. Sickinger did not include that missing information in his
    materials on this motion to set aside; and

(iv)       The
    motion judge wrote a comprehensive endorsement explaining her decision. Her
    endorsement is more than sufficient to permit appellate review.

The prejudice to the respondent support recipient

[30]

Ms. Sickinger deposed she would be prejudiced if the Dismissal Order is
    set aside. She states support arrears now exceed $100,000, and that she ought
    not be required to continue in litigation in which [Mr. Sickinger] has refused
    to abide by the court process.

[31]

I accept her submission.

V.       DISPOSITION

[32]

I conclude the justice of the case requires dismissing Mr. Sickingers
    motion: the merits of his appeal are very weak; he has not adequately explained
    why he failed to perfect his appeal within the time required by the
Rules
    of Civil Procedure
; he has not justified his delay in moving to set aside
    the Dismissal Order; and his delay is prejudicing Ms. Sickinger.

[33]

For these reasons, I dismiss his motion to set aside the May 23, 2017
    order dismissing his appeal. Ms. Sickinger did not seek any costs of the motion,
    so there will be no order as to costs.

David Brown J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Slate Management Corporation v. Canada (Attorney
    General), 2017 ONCA 763

DATE: 20171004

DOCKET: C62491

Hoy A.C.J.O., van Rensburg and Roberts JJ.A.

BETWEEN

Slate Management Corporation

Applicant
(Respondent in appeal)

and

The Attorney General of Canada

Respondent
(Appellant)

Geoff R. Hall and Ryan MacIsaac, for the respondent

Christa Akey and Diana Aird, for the appellant

Heard: June 21, 2017

On appeal from the order of Justice Glenn A. Hainey of
    the Superior Court of Justice, dated June 27, 2016, with reasons reported at
    2016 ONSC 4216.

Hoy A.C.J.O.:

[1]

The Attorney General of Canada (the AG) appeals a rectification order.
    For the following reasons, I agree with the respondent Slate Management
    Corporation (Slate) that the appeal is moot and this court should not
    exercise its discretion to hear it.

Background

[2]

On January 1, 2015, three subsidiaries of Slate Asset Management LP
    (SLAM) amalgamated under the
Business Corporations Act
, R.S.O. 1990,
    c. B.16 (the OBCA), in a single step.

[3]

SLAM intended to increase the cost amount of the real estate owned by
    Huntingdon Capital Corp. (HCC), one of its amalgamating subsidiaries
    obtaining what is colloquially referred to as a tax bump  through the
    amalgamation. Increasing the cost amount of the properties would reduce the
    amount of capital gains tax payable on any subsequent disposition.

[4]

SLAM later learned that it had not achieved its intended tax outcome
    because it amalgamated the three subsidiaries in a single step. Under s. 87(11)
    of the
Income Tax Act
, R.S.C. 1985, c. 1 (5th Supp.), a bump is only
    available on an amalgamation where a parent amalgamates with one or more of its
    wholly-owned subsidiaries. To achieve its objective, SLAM should have effected
    the amalgamation of the three subsidiaries in two steps: first, SLAMs
    wholly-owned subsidiary, Slate Capital Corporation (SCC), should have
    amalgamated vertically with its wholly-owned subsidiary HCC; second, the
    corporation resulting from the amalgamation of HCC and SCC should have
    amalgamated horizontally with the third wholly-owned subsidiary of SLAM and
    their sister corporation, Slate GTA Suburban Office Inc. (GTA).

[5]

On June 9, 2016, Slate (the corporation resulting from the amalgamation
    of the three subsidiaries) applied for a rectification order.

[6]

By order dated June 27, 2016 (the rectification order), the
    application judge granted the relief Slate had requested, including: deeming
    the January 1, 2015 single-step amalgamation (the initial amalgamation) not
    to have occurred; deeming in substitution the amalgamation to have occurred in
    the required two-steps on January 1, 2015 (the two-step amalgamation);
    approving a plan of arrangement under the OBCA deeming the initial amalgamation
    not to have occurred and the required two-step amalgamation to have occurred on
    January 1, 2015,
nunc pro tunc
; and directing the Director under the
    OBCA to cancel the certificate of amalgamation in respect of the initial
    amalgamation and endorse the Articles of Arrangement pursuant to s. 183 of the
    OBCA with a certificate dated January 1, 2015.

[7]

On July 26, 2016, the AG served a notice of appeal of the rectification
    order. It did not seek a stay of the rectification order pending appeal.

[8]

On August 2, 2016, the plan of arrangement was implemented. This was more
    than five weeks after the application judge granted the rectification order.

[9]

On December 9, 2016, the Supreme Court of Canada released its decision
    in
Fairmont Hotels Inc. v. Canada (Attorney General)
, 2016 SCC 56, [2016]
    2 S.C.R. 720, overruling the test for rectification applied by the application
    judge, and clarifying the test for rectification in a tax context.

[10]

The
    AG appeals the rectification order, arguing that Slate does not meet the test
    in
Fairmont
and that the rectification order should be set aside. It
    seeks an order cancelling the certificate of arrangement and reinstating the
    certificate of amalgamation issued on January 1, 2015. In the alternative, it
    argues that this court could order the filing of a new plan of arrangement, undoing
    the plan of arrangement effected in August of 2016. In the further alternative,
    it asks that this court find as a fact that the original amalgamation reflects
    Slates true legal status.

[11]

Slate
    argues that the effect of the Supreme Court of Canadas decision in
Norcan
    Oils Ltd. v. Fogler
, [1965] S.C.R. 36 is that this court cannot overturn
    the plan of arrangement approved as part of the rectification order; therefore,
    the AGs appeal of the rectification order is moot, and there is no reason for
    the court to exercise its discretion to hear the appeal. Further, Slate argues
    that the order below satisfies the new test in
Fairmont
in any event,
    and that this appeal ought to be dismissed.

Analysis

(1)

The principle in Norcan renders the appeal moot

(i)

The principle in Norcan

[12]

In
Norcan
, the court at first instance granted an order approving the
    amalgamation of two companies under Albertas corporate legislation and the
    corporate registrar accordingly issued a certificate of amalgamation. One of
    the shareholders appealed. The Appellate Division of the Supreme Court of
    Alberta allowed the appeal approximately ten months after the certification of
    amalgamation had been issued. The Supreme Court allowed the subsequent appeal
    and restored the initial order approving the amalgamation.

[13]

Justice
    Martland, writing for the majority of the Supreme Court, explained that upon
    the certificate of amalgamation being issued, the amalgamating companies became
    one company which possessed all the property rights, privileges and franchises
    and became subject to all the liabilities, contracts and debts of each of the
    amalgamating companies. (
Norcan,
at p. 36) The amalgamated company
    had existed and done business on its own account since the amalgamation,
    including entering into agreements, obtaining a loan, and incurring trade
    obligations.

[14]

He noted that, in the absence of a valid stay of
    proceedings, the enabling legislation required the parties to file the
    amalgamation agreement and approving order with the registrar and required the
    corporate registrar to issue the certificate of amalgamation. The filing of the
    notice of appeal did not stay or invalidate the approving order. He explained,
    at p. 44, that:

the whole purpose for which the order was made was fulfilled,
    a certificate of amalgamation was issued, and rights and interests have been acquired
    by other persons against and in the amalgamated company, upon the strength of
    that certificate.

He also explained that any person making a contract
    with the amalgamated company was entitled to rely upon the certificate [of
    amalgamation] as sufficient basis for the capacity of the amalgamated company
    so to do.

[15]

Finally,
    Martland J. observed that the Alberta corporate legislation contained no
    provision for the revocation of such a certificate. He concluded that the
    Appellate Division had no power to revoke the certificate and the setting aside
    of the approving order could have no effect.

(ii)

The application of Norcan in this appeal

[16]

Norcan
was not decided in the context of an application for rectification, and it does
    not stand for the proposition that the court cannot order the revocation of a
    certificate (whether a certificate of incorporation, amendment, amalgamation or
    arrangement) issued by the Director under corporate legislation unless the
    corporate legislation authorizes its revocation. While commercial certainty is
    important, it is also important that courts be able to relieve persons from the
    effect of their mistakes.

[17]

In
TCR Holding Corp. v. Ontario,
2010 ONCA 233, this court held that an
    application judge has equitable authority to set aside an

amalgamation
nunc pro tunc
based on the superior courts equitable jurisdiction to
    relieve persons from the effect of their mistakes. Slate apparently accepts
    this: while the OBCA contains no provision for the cancellation of a
    certificate of amalgamation, Slate sought and obtained an order from the
    application judge that among other things directed the Director under the OBCA
    to cancel Slates certificate of amalgamation.

[18]

In
    my view, if there is authority to direct the Director to cancel a certificate
    of amalgamation and endorse the articles of arrangement
nunc pro tunc
with
    a certificate dated January 1, 2015 incident to a rectification order, there is
    authority to order the Director to cancel that certificate of arrangement and
    reinstate the certificate of amalgamation if it is determined on appeal that
    the applicant was not entitled to rectification.

[19]

However,
    in the exercise of that authority, the court should be guided by the principle
    in
Norcan.
In my view, where, as here: (1) the Director under the OBCA
    issues a certificate pursuant to a rectification order; (2) the appellant could
    reasonably have sought a stay of the rectification order pending appeal; (3)
    the court is not satisfied that no third party acted, directly or indirectly,
    in reliance on the certificate issued pursuant to the rectification order and
    would not be prejudiced by its revocation; and (4) there are no special
    circumstances which justify exercising the power to cancel the certificate,
    thereby undermining certainty in a court-approved corporate fundamental change,
    the principle in
Norcan
requires the court to decline to exercise its
    authority to order the revocation of that certificate or otherwise unwind the
    court-approved corporate fundamental change.

[20]

The
    AG is a sophisticated party. It had ample time to seek a stay of the
    rectification order and provided no explanation why it did not do so.

[21]

I
    am not persuaded that no third party acted, directly or indirectly, in reliance
    on the certificate of arrangement issued pursuant to the rectification order
    and would not be prejudiced by its revocation.

[22]

While
    the AG is correct that the relief requested would not undermine third party
    reliance on the
existence
of the amalgamated
    company (as was the case in
Norcan
), Slate has provided evidence that
    third parties have relied on the
financial consequences
of the plan of arrangement implemented pursuant to the rectification order.

[23]

Slates
    General Counsel deposed that, in January 2017, Slate renewed and increased a
    revolving line of credit with one of its lenders and the lender, in renewing
    and increasing the line of credit, relied upon, among other things, Slates
    current financial statements which reflected the tax bump benefit it obtained
    through the two-step amalgamation. Slates General Counsel further deposed
    that Slate provided copies of its updated financial statements to another
    lender under a credit facility that pre-dates the January 1, 2015 amalgamation.

[24]

The
    General Counsels evidence that third parties indirectly relied on the
    certificate of arrangement was not challenged through cross-examination and the
    AG did not provide any evidence to contradict it. It is not disputed that the
    financial impact of the bump achieved through the plan of arrangement is
    material to Slate. It is reasonable to think it may also have been significant
    to the lender which increased the credit extended to Slate.

[25]

Finally,
    fraud is not alleged and there are no other special circumstances which justify
    exercising the power to cancel the certificate of arrangement.

[26]

The
    principle in
Norcan
also requires the court to decline to order the
    alternate relief the AG seeks. This relief, whether in the form of an order
    directing Slate to file a new plan of arrangement unwinding the plan of
    arrangement approved by the application judge, or an order declaring that the
    original amalgamation reflects Slates true legal status, is also a means of
    unwinding a court-approved corporate fundamental change following its
    implementation. Again, the AG could have obtained a stay of the rectification
    order but failed to do so; I am not persuaded that no third party acted,
    directly or indirectly, in reliance on the certificate of arrangement issued
    pursuant to the rectification order and would not be prejudiced by the
    unwinding of the transaction; there are no special circumstances justifying
    unwinding the court-approved transaction.

[27]

Because
Norcan,
properly interpreted, would not permit this court to give
    effect to a decision that Slate fails to meet the test for rectification in
Fairmont
,
    I find that this appeal is purely academic.

(2)

This court should not exercise its discretion to hear the appeal

[28]

Once
    a court determines that an appeal is moot, it is necessary to decide whether
    the court should nonetheless exercise its discretion to hear the case:
Borowski
    v. Canada (Attorney General),
[1989] 1 S.C.R. 342, at p. 353. Three
    factors are relevant in determining whether a court should entertain a moot
    appeal: (i) the presence of an adversarial context that will ensure that the
    issues are well and fully argued; (ii) concern for judicial economy; and (iii)
    awareness of the courts proper law-making function:
Borowski
, pp.
    358-363.

[29]

Considering
    these factors, I am not persuaded that the court should exercise its discretion
    to hear the appeal. While the appeal involves two sophisticated parties
    represented by counsel and its resolution would not intrude on the role of the
    legislative branch of government, the second factor weighs heavily against
    hearing it.

[30]

There
    are no special circumstances in this case that justify the use of scarce
    judicial resources to resolve the appeal: it will not have a practical effect
    on the rights of the parties; it does not entail an important issue that might
    independently evade review or of which a resolution is in the public interest;
    the appeal is not of jurisprudential importance. It concerns the application of
    the recently revised test for rectification to very particular facts. As a
    result, there is no social cost in leaving the matter undecided.

Disposition

[31]

For
    the above reasons, I would quash the appeal. I would order that Slate be
    entitled to costs in the agreed-upon amount of $25,000, inclusive of disbursements
    and HST.

Released: AH OCT 04 2017

Alexandra Hoy A.C.J.O.

I agree K.M. van Rensburg J.A.

I agree L.B. Roberts J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Smith v. Smith, 2017 ONCA 759

DATE: 20171002

DOCKET: C62021

MacFarland, Watt and Benotto JJ.A.

BETWEEN

Johnny Smith

Respondent (Applicant)

and

Denise Boyda Smith

Appellant (Respondent)

P. D. Marshall, for the appellant

S. Klotz and J. Klotz, for the respondent

Heard: September 25, 2017

On appeal from the order of Justice Antonio Skarica of
    the Superior of Justice, dated March 21, 2016.

REASONS FOR DECISION

[1]

The parties are husband and wife. Before their marriage, they signed a
    cohabitation agreement whereby the wife released her claims to spousal support.
    Upon separation, the wife sought to claim spousal support. The trial judge upheld
    the cohabitation agreement, dismissed her claim to support and determined the
    parties income for child support. She appeals the dismissal of spousal support
    and the determination of income.

[2]

The parties began their cohabitation on March 1, 1997. The husband had
    experienced an acrimonious separation of a prior relationship and wanted to
    avoid a repetition. Before continuing a relationship with the wife, and before
    purchasing a home, he wanted the security of a cohabitation agreement. The
    agreement was drafted and presented to the wife. Although given the opportunity
    to do so, she did not obtain independent legal advice. The agreement was signed
    on October 7, 1997.

[3]

Paragraph 8 of the agreement provides as follows:

NO CLAIM FOR SPOUSAL SUPPORT AND MAINTENANCE

a)

Each party
    releases the other from all claims that each may have against the other for the
    payment of interim or permanent support or maintenance whether periodic or lump
    sum under the laws of any jurisdiction, and in particular under the provisions
    of the Act, or any successors thereto;

b)

Should either
    party hereafter make a claim against the other for support or maintenance, the
    provisions of this paragraph may be pleaded as and shall be a full and complete
    defence to any such claim;

c)

Each party acknowledges
    that he or she is self-supporting or fully capable of being self-supporting and
    requires no financial assistance from the other;

d)

Each party
    acknowledges that each may suffer or enjoy drastic changes in health, income,
    assets and debts, or changes in fortune by reason of unforeseen factors, but
    nevertheless agree that under no circumstances, however catastrophic or
    unconscionable, will any change, direct or indirect, or unforeseen, give either
    the right to claim any support or maintenance from the other.

[4]

The parties had two children. The first was born in 2001 and the second
    in 2003. They married on June 6, 2003. They separated in September 2013 and
    proceeded to trial with respect to financial issues including spousal and child
    support.

[5]

The trial judge upheld the cohabitation agreement and dismissed the
    wifes claim for spousal support. In determining the parties income, he
    imputed income to the wife and reduced the husbands income because of his
    health issues.

[6]

The wife alleges that the trial judge erred in upholding the
    cohabitation agreement because the release of support does not meet the
    provisions of the
Divorce Act
, R.S.C., 1985, c. 3 (2nd Supp.) She also
    submits that he erred in calculating income for child support.

[7]

In
Miglin v. Miglin
, 2003 SCC 24, [2003] 1 S.C.R. 303, the
    Supreme Court of Canada set out a two-stage analysis to be applied in dealing
    with initial applications for spousal support in the face of a release. The
    first stage considers the circumstances at the time the agreement was created.
    This stage of the analysis is subdivided into two parts:

(1) A consideration of the circumstances surrounding
    negotiation and execution of the agreement to determine whether there is any
    reason to discount it.

(2) A consideration of the substance of the agreement to
    determine whether it was in substantial compliance with the general objectives
    of the
Divorce Act
at the time of its formation.

[8]

The second stage of
Miglin
requires the court to consider, at
    the time of the application for spousal support, whether the applicant has
    established that the agreement no longer reflects the original intention of the
    parties, and whether the agreement is still in substantial compliance with the
    objectives of the
Divorce Act
.

[9]

The objectives of the
Divorce Act
include certainty, finality
    and autonomy:
Miglin
at para. 4. Subsection 15.2(6) of the
Divorce
    Act
states that a spousal support order should:

(a)
Recognize
    any economic advantages or disadvantages to the spouses arising from the
    marriage or its breakdown;

(b) Apportion between the
    spouses any financial consequences arising from the care of any child of the
    marriage over and above any obligation for the support of any child of the
    marriage;

(c) Relieve any economic hardship of the spouses
    arising from the breakdown of the marriage; and

(d) In so far as practicable, promote the economic
    self-sufficiency of each spouse within a reasonable period of time.

[10]

The wife submits that the trial judge did not consider important facts
    when he applied the
Miglin
test.  She says, there was a power
    imbalance between her and the husband, she had not discussed spousal support
    with the husband, the financial disclosure was incomplete, the trial judge misconstrued
    the evidence when he said that her income at the date of  the agreement was
    $70,000,  and she did not have independent legal advice. She acknowledges that
    she was not coerced. She also submits that the agreement does not align with
    the overall objectives of the
Divorce Act
,
at the time of signing or now, because the parties had an
    18-year relationship, she bore the primary responsibility for the children, and
    his income exceeds hers.

[11]

We do not accept the wifes submissions. She has shown no error of law
    or misapprehension of fact on the part of the trial judge. If the trial judge
    misstated the wifes income at the date of the agreement, the error was not
    material. There is no suggestion that the income of the parties at the date of
    the agreement impacted her decision to sign the agreement. The trial judge
    carefully reviewed the
Miglin
test, s. 56(4) of
the Family Law Act
, R.S.O. 1990, c. F.3,
and
LeVan v.
    LeVan
,
2008 ONCA 388, 90
    OR (3d) 1.  He made the following findings of fact:

a)

The wife was aware of the husbands desire to have a cohabitation
    agreement.

b)

The parties had discussed the cohabitation agreement before the wife
    received it.

c)

The wife was aware of all of the husbands sources of income and assets
    and did not pursue further disclosure.

d)

The wife skimmed over the cohabitation agreement and read some parts of
    it and not others.

e)

There was no fraud, coercion, or duress.

f)

Although given the opportunity, the wife did not seek independent legal
    advice even though  on her evidence  she had six weeks to do so.

g)

At the time of signing the agreement, the wife thought it was fair and
    that it fairly outlined the parties discussions regarding the purchase of a
    house.

h)

The agreement is in substantial compliance with the Divorce Act.  Both parties
    suffered economic disadvantages arising from the marriage, and more
    importantly, even if the cohabitation agreement did not exist, the wife would
    not be entitled to spousal support.

[12]

The wife further submits that the trial judge erred in attributing
    $40,000 to her and $73,000 to the husband for purposes of child support.

[13]

She submits that her income is $18,204 as disclosed on her financial
    statement. However, the trial judge found that by working part-time she was
    deliberately underemployed. He concluded, based on her evidence, that she could
    earn $30,000 per year and would receive child tax benefits bringing her income
    to $40,000. She submits that it was an error on the part of the trial judge to
    add the child tax benefits to her income for support purposes. She argues that
    tax benefits are included in the financial statement to determine the budget
    one needs to meet expenses. On this basis alone, the trial judge was entitled
    to consider it income.

[14]

With respect to the husbands income, the trial judge accepted the
    evidence that his income would be reduced to $73,000 per year due to his health.

[15]

The findings and conclusions of the trial judge were open to him on the the
    evidence and are entitled to deference from this court.

[16]

Accordingly, the appeal is dismissed with costs payable to the husband
    in the amount of $12,000 inclusive of disbursements and HST. This does not
    include the outstanding costs award currently owed by the wife.

J. MacFarland J.A.

David Watt J.A.

M.L. Benotto J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Teixeira v. Markgraf Estate, 2017 ONCA 819

DATE: 20171026

DOCKET: C63370

Strathy C.J.O., van Rensburg and Trotter JJ.A.

BETWEEN

Arlindo Teixeira

Applicant (Appellant)

and

Estate of Maria Markgraf, also known as
Mary Markgraf, also known as Maria Mendonca Alves,
and Harry Claus Markgraf

Respondents (Respondents)

Don Morris, for the appellant

Andrew L. Keesmaat, for the respondents

Heard: September 7, 2017

On appeal from the judgment of Justice Alan C.R. Whitten
    of the Superior Court of Justice, dated January 20, 2017, with reasons reported
    at 2017 ONSC 427, 136 O.R. (3d) 143.

Strathy C.J.O.:

A.

OVERVIEW

[1]

The
    appellant, Arlindo Teixeira (Arlindo), was a good neighbour to Mary Markgraf
    (Mary) for nearly 15 years. He helped her with household maintenance, drove her
    about, and assisted with chores like groceries and banking.

[2]

Shortly
    before her death, Mary made a will. She made a bequest to Arlindo of $100,000.
    She also wrote out a cheque to him for $100,000. She asked her stepson to give
    it to Arlindo with instructions that he should take it to her bank the next
    day.

[3]

Cheque
    in hand, Arlindo went to Marys bank the next day. After inspecting the cheque
    and making some inquiries, the bank employee told him that they would have to
    investigate and returned the cheque to him.

[4]

What
    the bank employee did not tell Arlindo was that Mary had insufficient funds in
    her account to cover the cheque. The balance in her account was only $81,732.75.
    But Mary had over $200,000 in other funds on deposit at the branch. Without her
    specific instructions, however, the bank could not transfer money to her
    chequing account to make up the shortfall.

[5]

Mary
    died six days later. The bank was notified of her death the following day and
    froze her accounts. Arlindo then attempted to deposit the cheque at his own
    bank, but it was returned, marked funds frozen.

[6]

Marys
    stepson, her estate trustee, told Arlindo that he would be receiving $100,000
    from the estate and another $100,000 to cover the cheque. However, after
    obtaining legal advice, the estate trustee ultimately took the position that
    the cheque was an imperfect gift that was not legally enforceable. Arlindo
    received Marys $100,000 bequest under the will.

[7]

Arlindo
    sued Marys estate for the value of the cheque. The application judge dismissed
    his claim, finding that the gift failed for lack of delivery.

[8]

These
    reasons explain why I agree with the application judge and would dismiss the
    appeal.

B.

THE DECISION IN THE COURT BELOW

[9]

The
    application judge made the following central findings of fact. First, Arlindo
    had acted as he did towards Mary without thought of compensation. Second, there
    was no evidence of a contract between Arlindo and Mary. Third, Arlindo had not
    acted to his detriment in anticipation of receiving Marys cheque.

[10]

The application judge correctly
    identified the essential elements of a gift as being: (a) the donors
intention
to make a gift; (b)
acceptance
of the gift by the donee; and (c)
delivery
of the
    gift to the donee.

[11]

He found the first two
    requirements had been met. Mary intended to make a gift of $100,000. She had
    the necessary mental capacity to make the gift and she believed she had the
    money in her account. Arlindo had accepted the gift, which he attempted to
    realize by taking the cheque first to Marys bank, then to his own.

[12]

But the application
    judge held that the third requirement  delivery  had not been established.
    The gift had not been perfected by delivery because Mary did not have
    sufficient funds in her account. She could not give what she did not have. While
    she did have sufficient funds in other accounts, the bank could not have
    transferred those funds without direction from her.

[13]

The application judge
    also rejected Arlindos argument that the cheque was payment for services
    rendered. His good acts could not be characterized as consideration and there
    was no evidence of a contract.

[14]

The application judge
    also held that the doctrine of estoppel by convention did not apply on the
    facts of the case. The test in the leading case of
Ryan v. Moore
, 2005
    SCC 38, [2005] 2 S.C.R. 53, was not made out because Arlindo had not changed
    his legal position in reliance on a shared assumption.

[15]

Consequently, the
    application judge held that the gift of $100,000 by cheque was not enforceable.
    He dismissed Arlindos application, with costs of $14,000.

C.

THE APPELLANTS SUBMISSIONS

[16]

The appellant advances
    a number of alternative submissions, in an attempt to avoid what he submits is
    an unfair result.

[17]

First, he advances a
    claim in contract, arguing that his good deeds provided some consideration.

[18]

Second, he submits that
    the cheque was enforceable by virtue of the
Bills of Exchange Act
,
    R.S.C. 1985, c. B-4 (
BEA
). As part of this argument, he submits that
    the cheque was dishonoured when it was taken to Marys bank, giving him an
    immediate right of recourse.

[19]

Third, the appellant
    renews his argument that the gift by cheque was perfected by delivery.

[20]

Fourth, he relies on
    equity. He invokes estoppel by convention and the principle that equity will
    not strive officiously to defeat a gift.

[21]

Finally, the appellant
    seeks leave to appeal the costs award in the court below.

D.

ANALYSIS

[22]

I will deal with the
    appellants submissions in the order set out above.

(1)

The claim in contract

[23]

The claim based on
    contract fails because of the application judges findings that there was no
    contract between the parties and that Arlindos acts were done gratuitously. These
    findings of fact are unassailable. The appellant has demonstrated no palpable
    and overriding error in the application judges assessment of the evidence.

[24]

Arlindos good deeds
    were performed with no expectation of compensation. They could not provide
    consideration for a non-existent contract.

(2)

The claim under the
Bills of Exchange Act

Absence of consideration

[25]

The application
    judges findings of fact that there was no consideration or contract are also
    determinative of the appellants arguments under the
BEA
.

[26]

It is settled law
    that, as between the immediate parties, the failure or absence of consideration
    is a complete defence to an action on a bill of exchange.

[27]

In
The Law of
    Banking and Payment in Canada
, loose-leaf (2016-Rel. 1, Vol. 3) (Toronto:
    Thomson Reuters, 2015), Bradley Crawford describes the effect of this defence
    as follows, at p. 26-35:

Both total failure of consideration and complete absence of
    consideration (
as, for example, where a gift
    is made by cheque of the donor but not completed by payment upon presentment
)
    are defences to actions upon the engagements of immediate parties to a bill,
    cheque or note. A gratuitous promise of payment does not become binding at the
    suit of the immediate promisee merely because it is expressed formally in a
    negotiable instrument. [Emphasis added.][Footnotes omitted.]

See also: Benjamin Geva, Absence of consideration in
    the law of bills and notes (1980) 39 Cambridge L.J. 360;

Bradley Crawford,
Crawford and
    Falconbridge on Banking and Bills of Exchange
, 8th ed. (Toronto, Canada
    Law Book, 1986), at pp. 1429-30.

[28]

The appellant
    acknowledges that a total absence of consideration would be a defence to an
    action on the cheque, but argues that in this case his good deeds provide
    partial consideration. There is nothing in the application judges reasons to
    support the appellants claim that there was some, but inadequate,
    consideration for the cheque. This is a case of complete absence of
    consideration. That would have been a defence to an action against Mary and it
    is a defence to an action against her estate.

[29]

This case is very
    similar to
Peden v. Gear
(1921), 50 O.L.R. 384 (H.C.). The daughter of
    the deceased sued on a promissory note given to her by her father before his
    death. It was admitted that there was no consideration for the note, which was
    given solely for natural love and affection. Logie J. dismissed the claim,
    stating at p. 385:

There cannot possibly be any claim by way of action on a
    promissory note by the original payee to whom the promissory note was given, if
    she never gave any consideration for it; she is not a creditor of the deceased;
    and the enforcement of such promises by law, however plausibly reconciled by
    the desire to effect all conscientious engagements, might be attended with
    mischievous consequences to society, one of which would be the frequent
    preference of voluntary undertakings to claims for just debts, to the prejudice
    of real creditors.

The temptations of executors would be much increased by the
    prevalence of such a doctrine, and the faithful discharge of their duty be
    rendered more difficult.

Accordingly neither the fact that the deceased was apparently
    distributing a large portion of his estate among his children by gifts
inter
    vivos
, nor the plaintiff's plea that her father is dead and the claim is
    resisted only by his executors, should receive any consideration. The executors
    are entitled and in duty bound to set up the want of consideration. The
    authorities are clear that a cheque not paid either actually or constructively
    during the lifetime of the drawer is not capable of being the subject of a
donatio
    mortis causa
: Chalmers, 8th ed., p. 289;
Re Bernard

(1911), 2 O.W.N. 716
.

The donor's own promissory note given voluntarily is in no
    better position. A cheque is no more than an order to obtain a certain sum of
    money. A promissory note is no more than a promise to pay a certain sum of money.
    I find no case to sustain the contention that the delivery of the maker's own
    voluntary note is a valid gift either as a
donatio mortis causa
or as
    a gift
inter vivos
. See
Rupert v. Johnston
(1876), 40 U.C.R. 11
.

[30]

In order to rely on
    the provisions of the
BEA
, the appellant had to establish that the
    cheque constituted something other than a gift. As stated in
Crawford and
    Falconbridge on Banking and Bills of Exchange
, at p. 1419:

Where the donor is the drawer or maker and the donee is the
    payee, the gift will fail if the donee requires the assistance of the court to
    enforce it, as, for example, after a change of heart and countermand or receipt
    by the drawee of notice of the drawers death. However, where the gift is
    completed by delivery and the cheque is collected before the drawee learns of
    the drawers death, it may be an effective means of transferring the value
    intended to be given.

The case is quite different where a cheque or note is made
    payable to a person for valuable consideration. [Footnotes omitted.]

[31]

The
BEA
did not
    impose an independent legal obligation on Mary merely because she wrote a
    cheque. If she had changed her mind and refused to transfer sufficient funds
    into the account, or had she revoked the cheque by issuing a stop payment
    order, she would not have been bound to pay Arlindo. Her death did not change
    the underlying nature of the cheque. Possession of the cheque, without more,
    does not allow Arlindo to successfully sue for its value.

Dishonoured cheque

[32]

I turn to the
    appellants alternative submission that the cheque was dishonoured when he
    presented it to Marys bank, before her death, giving rise to a cause of
    action.

[33]

This argument was not
    made in the court below. This explains why there are no pertinent findings of
    fact made by the application judge. There is insufficient evidence in the
    record to permit us to make that determination.

[34]

Assuming for the
    purposes of argument that the cheque was dishonoured, the reason was evidently
    that there were insufficient funds in the account. Despite her good intentions,
    Mary could not give what she did not have and the appellant had no cause of
    action on the cheque. Unlike
Re Swinburne
,
[1926] 1 Ch. 38 (C.A.)
, there was no evidence that the bank here would
    honour the cheque if a customer had sufficient funds to do so in their other
    accounts. The evidence in this case was to the contrary. The bank could not
    transfer funds to cover the cheque without the customers authority.

[35]

If the appellant had
    brought an action on the cheque, either after he first went to the bank or
    after the cheque was returned funds frozen, he would have been met with a
    defence of lack of consideration.

(3)

Gift

[36]

The application judge
    was correct in holding that that the cheque was a gift
inter vivos
and
    that the law of gifts applied to the facts of this case.

[37]

The absence of
    consideration is one of the central indicia of a gift at law. By its very
    nature, a gift is a voluntary transfer of property to another without
    consideration:
McNamee v. McNamee
, 2011 ONCA 533, 106 O.R. (3d) 401,
    at para. 23. In
Peter v. Beblow
, [1993] 1 S.C.R. 980, McLachlin J. (as
    she was then) described the central element of a gift at law as the intentional
    giving to another without expectation of remuneration: at pp. 991-2.

[38]

The three elements of
    a legally valid gift identified by the application judge and referred to at
    para. 10, above, are well established: (1) an intention to make a gift on the
    part of the donor, without consideration or expectation of remuneration; (2) an
    acceptance of the gift by the donee; and (3) a sufficient act of delivery or
    transfer of the property to complete the transaction:
McNamee v. McNamee
,
    at para. 24. All three requirements are essential: Mary Jane Mossman & William
    F. Flanagan,
Property Law: Cases and Commentary
, 2nd ed. (Toronto:
    Emond Montgomery Publications Limited, 2004), at p. 441.

[39]

The first two elements
    are not at issue on this appeal. The central issue here is whether the delivery
    of the cheque for $100,000 into the hands of the appellant could be a
    sufficient act of delivery of the gift. The wrinkle in this case is that there
    were insufficient funds in Marys account.

Delivery

[40]

The delivery
    requirement has been a part of the modern law of gifts since the seminal case
    of
Irons v. Smallpiece
(1819), 2 B. & A. 551. The delivery
    requirement is an important distinguishing feature of gifts as compared to
    other methods of transferring property, such as by contract. As Mossman and
    Flanagan note in
Property Law: Cases and Commentary
, at p. 442:

The delivery requirement marks an important difference between
    contract law and the law of gifts. A contract involves an exchange of promises.
    A gift, a unilateral promise, does not. Contract law will enforce an exchange
    of promises (a bargain promise) with expectation damages. On the other hand,
    the law of gifts attaches no significance to a unilateral promise to pay in the
    absence of delivery.

[41]

The delivery
    requirement in the law of gifts continues to serve several important functions.
    It forces a would-be donor to consider the consequences of their expressed
    intention to make a gift and it furnishes tangible proof that a gift has in
    fact been made: see Bruce Ziff,
Principles of Property Law
, 6th ed. (Toronto, Thomson Reuters, 2014),
at
    pp. 161-2. See also: Philip Mechem, The Requirement of Delivery in Gifts of
    Chattels and of Choses in Action Evidenced by Commercial Instruments (1926) 21
    Ill. L. Rev. 341, at pp. 348-352.

Indicia of delivery

[42]

The most obvious form
    of delivery is the actual physical transfer of the subject matter of the gift
    from the donor to the donee such that the gift is literally given away: see
    Ziff, at p. 161.

[43]

However, in certain
    circumstances, such as where the item is unwieldy, courts have acknowledged
    that constructive delivery will suffice. In these cases,
the critical questions have been whether or not the
    donor retained the means of control and whether all that could be done had been
    done to divest title in favour of the donee: see Ziff,
at p. 165.

[44]

Ultimately, in order for
    a gift to be valid and enforceable, the donor must have done everything
    necessary and in his or her power to effect the transfer of the property:
Kavanagh
    v. Lajoie
, 2014 ONCA 187, 317 O.A.C. 274, at para. 13.

Gifts by cheque

[45]

A gift of cash can be readily
    effected by delivery to the donee. But a gift of money by cheque can be
    problematic, due to the nature of a cheque. A cheque is not money. Nor is it a
    transfer of property. It is a direction by the drawer (the banks customer) to
    the drawers bank to pay a sum of money to the payee:
Re Bernard
(1911),
    2 O.W.N. 716 (Div. Ct.), at p. 717. The direction can be revoked by the drawer
    at any time  for example, by a stop payment order, referred to in s. 167 of
    the
BEA
as countermand. Under s. 167, the banks authority to pay
    the cheque is terminated by countermand or when the bank receives notice of its
    customers death:
McLellan v. McLellan
(1911), 25 O.L.R. 214 (Div.
    Ct.), at p. 216;
Re Beaumont
, [1902] 1 Ch. 889, at p. 894.
[1]

[46]

For these reasons, a gift
    by cheque is not complete when the cheque is given to the donee. It is only
    complete when the cheque has been cashed or has cleared: see
Ziff,
at p. 166. Thus, in
Campbell v.
    Fenwick
, [1934] O.R. 692 (C.A.), a cheque given to the donee three days
    before the donors death and cashed a day before her death was found to be a
    valid
inter vivos
gift of the amount of the cheque.

[47]

In
Re Swinburne
, above, a case strikingly similar to this one, the Court of Appeal for
    England and Wales held that the death of the donor ruins a gift
inter
    vivos
by way of cheque if the cheque is not
    deposited before the donor dies. There, the donor had given the defendant a cheque
    shortly before her death. The bank refused to honour the cheque because of concerns
    about the validity of the signature. Before anything else could be done, the
    donor died. On the date the cheque was presented, the donor had insufficient
    funds in her current account, on which the cheque was drawn, but sufficient
    money to cover the cheque in her deposit account. In light of evidence given by
    the bank that it might honour a cheque in such circumstances, the court
    considered the case as though the whole amount was in the current account.

[48]

Nonetheless, the court held that a gift
inter
    vivos
was not made out. In reaching this conclusion, Warrington L.J.
    wrote, at p. 44:

[I]n order to make an effectual gift
inter vivos
there
    must be an actual transfer of the subject of the gift or of the indicia of
    title thereto. A cheque is not money. It is not the indicia of title to money. A
    cheque is nothing more than an order directed to the person who has the custody
    of the money of the [donor] requiring him to pay so much to the person in whose
    favour the cheque is drawn.

[49]

Similarly, in
Re
    Bernard
, above, the deceased had written a cheque for $1,000 payable to
    her sister and put it in her cash box with a note that her sister should
    present the cheque one month after her death. She gave the key to the box to
    her niece, with instructions to give it to her solicitor after her death. The
    box was duly opened after her death and the cheque was discovered. Chief
    Justice Mulock held that the donee could not enforce her claim, stating, at p.
    717:

A cheque is not a chose in action, but merely a direction to
    some one, who may or may not have in his possession funds of the drawer
    authorising him to pay to the payee a certain sum of money. Death of the drawer
    before presentation revokes such authority. Thus in this case the claimant is
    met with two difficulties, each fatal to her claim: one being that the cheque
    not having been acted upon by acceptance or payment, never lost its primary
    character of a mere cheque, which is not a chose in action, and is not the
    subject of donatio mortis causa; and the other being that the testatrix's death
    revoked the banker's authority to pay the cheque.

[50]

The appellant argues
    that death only terminates the banks authority to pay on a cheque, not the
    drawers duty to pay, citing Crawfords
The Law of Banking and Payment in
    Canada
. While this statement of the law is correct with respect to the
    authority of the bank, there must still be some independent duty to pay in
    order for the payee to be able to enforce a claim against the estate. As
    Crawford goes on to state, in the same passage cited by the appellant, at p.
    34-54.1:

However, since the bank has no duty to anyone but its customer
    to pay, unless it has certified the cheque, the only recourse available to the
    holder is action against the estate, assuming that the liability continues
    under the applicable provincial law dealing with successions. If the holder is
    not a holder for value, as where a gift or
donatio mortis causa
has
    been attempted, he may retain proceeds collected before the bank learned of its
    customers death, but will be unable to compel completion by payment
    thereafter, at least in any common law province. [Footnotes omitted.]

[51]

The appellant also cites
Campbell v. Fenwick
, above, in support of the contention that death
    terminates any power of revocation of a cheque by the estate of the donor and
    leaves the original gift in full vigour and effect. However, in
Campbell v.
    Fenwick
, the donee had successfully deposited the cheque the day before
    the death of the donor and the estate was trying to recover the funds. The gift
inter vivos
was therefore complete and death did not intervene.
    Indeed, the donee in that case had learned that a cheque would be revoked by
    death and knew the importance of having the cheque cashed during the donors
    lifetime. She deposited the cheque the day after she received it for this
    reason.

[52]

I conclude that the application
    judge was correct. The purported gift of $100,000 by way of cheque failed
    because it was not delivered before the bank received notice of Marys death.

(4)

Equitable principles

Estoppel by convention

[53]

Estoppel by convention
    is an equitable doctrine that holds parties to the facts or law or other
    assumption they have agreed to as the basis for a transaction to which they are
    parties:
Halsburys Laws of Canada
, Estoppel, 1st ed. (Toronto:
    LexisNexis Canada, 2016 Reissue), at HES-55. The nature of estoppel by
    convention was discussed by the Supreme Court in
Ryan v. Moore.
Bastarache
    J., at para. 4, said that:

Estoppel by convention operates where the parties have agreed
    that certain facts are deemed to be true and to form the basis of the
    transaction into which they are about to enter. If they have acted upon the
    agreed assumption, then, as regards that transaction, each is estopped against
    the other from questioning the truth of the statement of facts so assumed if it
    would be unjust to allow one to go back on it. [Citations omitted.]

[54]

Bastarache J. set out
    the following criteria for the application of the doctrine, at para. 59: (1) the
    parties' dealings must have been based on a shared assumption of fact or law:
    estoppel requires manifest representation by statement or conduct creating a
    mutual assumption. Nevertheless, estoppel can arise out of silence (impliedly);
    (2) a party must have conducted itself, i.e. acted in reliance on such shared
    assumption, its actions resulting in a change of its legal position; (3) it
    must also be unjust or unfair to allow one of the parties to resile or depart
    from the common assumption. The party seeking to establish estoppel therefore
    has to prove that detriment will be suffered if the other party is allowed to
    resile from the assumption since there has been a change from the presumed
    position.

[55]

The application judge
    referred to this test. He found that the appellant did not meet the test
    because he did not act in reliance on an assumption that Marys cheque would be
    honoured. There was nothing unfair in the outcome because Mary could not give
    him what she did not have.

[56]

The appellant argues
    that the parties shared a common assumption that Mary had the necessary funds
    in her account and that her cheque to Arlindo would be honoured.

[57]

That may be true, but
    the assumption was made after Marys cheque was delivered to Arlindo. Everyone
    assumed that the cheque was good. Arlindo did not change his legal position as
    a result of that assumption. He simply hoped that he would receive Marys gift.

[58]

In my view, the
    doctrine of estoppel by convention does not assist the appellant.

Equity will not strive officiously to
    defeat a gift

[59]

The appellant relies on
    the principle that equity will not strive officiously to defeat a gift: see
Pennington
    v. Waine
, [2002] EWCA Civ. 227, at paras. 54-59, 60-67, 115-117. This is
    in contradistinction to the somewhat more familiar maxim, equity will not
    assist a volunteer.

[60]

In support of this submission,
    the appellant cites Ziff at p. 163. Referring to
T. Choithram International
    S.A. v. Pagarani
, [2001] 1 W.L.R. 1 (P.C.), the author suggests that an
    imperfect gift, which is not perfected by a transfer of possession to the donee,
    may nevertheless be effective where the donor retains possession of the gift
    but makes a declaration evidencing an intention to hold the property in trust
    for the donee. That is clearly not the case here.

[61]

The other authorities
    cited by the appellant, the decision of this court in
Bank Leu A.G. v.
    Gaming Lottery Corp.
(2003), 231 D.L.R. (4th) 251 (Ont. C.A.), and the
    decision of the British Columbia Supreme Court in
Mordo v. Nitting
,
    2006 BCSC 1761, at paras. 271-2, do not refer to the equitable principle
    invoked by the appellant. The former endorses the principle that a transfer of
    shares may be effective as between donor and donee notwithstanding that further
    acts might be required to make the transfer effective in law. The latter case
    was one in which everything necessary had been done to create a valid trust.
Pennington
    v. Waine
was also a case involving shares.
T. Choithram International
    S.A. v. Pagarani
was a trust case in which property was given to an
    already constituted trust.

[62]

In
Pennington v. Waine
,
    Lady Justice Arden observed, at para. 62, that [t]here must also be, in the
    interests of legal certainty, a clearly ascertainable point in time at which it
    can be said that the gift was completed, and this point in time must be arrived
    at on a principled basis. I respectfully agree with that observation in the
    context of this case, which involves the well-settled law concerning the
    delivery of a gift by way of cheque. The temptation to temper the wind to the
    shorn lamb, the allegory used in that case, should be resisted when it
    conflicts with settled law. I see no basis for its application in this case.

(5)

Costs

[63]

The application
    judges costs order was discretionary. He considered the relevant principles
    with respect to costs, including those set out in r. 57.01. He also considered
    the principles set out in the leading case of
Boucher v. Public Accountants
    Council for the Province of Ontario
(2004), 71 O.R. (3d) 291 (C.A.), and
    the modern approach to costs in estate litigation expressed in
McDougald Estate
(2005), 255 D.L.R. (4th) 435 (Ont. C.A.)
.
He noted as well the
    appellants refusal of what he described as a generous offer of settlement.
    The appellant has demonstrated no basis on which this court could find an error
    in the exercise of the application judges discretion with respect to costs. I
    would not grant leave to appeal costs.

E.

DISPOSITION

[64]

For these reasons, I
    would dismiss the appeal, with costs to the respondents in the amount of
    $15,000, inclusive of disbursements and all applicable taxes.

Released: G.R.S.  OCT 26 2017

George R. Strathy
    C.J.O.

I agree. K. van
    Rensburg J.A.

I agree. G.T.
    Trotter J.A.

[1]

Under the
BEA
it is not the death of the
    customer, but notice of the death to the bank, that operates to revoke the
    banks authority to pay. Where a cheque is cashed after the death of the donor,
    but before the bank received notice thereof, it has been held that the gift is
    valid and complete:
Kendrick v. Dominion Bank
(1920), 47 O.L.R. 372.


COURT OF APPEAL FOR ONTARIO

CITATION: Tracy v. Iran (Information and Security), 2017 ONCA
    777

DATE: 20171011

DOCKET: C62403, C62404, C62405, C62406 and C62407

Hoy A.C.J.O., Blair and Hourigan JJ.A.

BETWEEN

Edward
    Tracy, by his Litigation Guardian, Charles Murphy, Elizabeth Cicippio-Puleo,
    Estate of Helen Fazio, Estate of Domenic Cicippio, David B. Cicippio, Eric R.
    Cicippio, Richard Dennis Cicippio, Thomas J. Cicippio, Estate of Paul V.
    Cicippio, Allen John Cicippio, Estate of Rose Abell, Anthony Cicippio, Estate
    of Alexander Cicippio, Nicholas B. Cicippio and Estate of Joseph J. Cicippio Jr.

Applicants (Respondents)

and

The Iranian Ministry of Information and
    Security, The Islamic Republic of Iran
and
The
    Iranian Revolutionary Guard Corp.

Respondents (Appellants)

AND BETWEEN

Estate of Marla Bennett, Michael Bennett,

Linda
    Bennett and Lisa Bennett

Plaintiffs
    (Respondents)

and

The Iranian Ministry of Information and Security

and
    the Islamic Republic of Iran

AND BETWEEN

Chad Phillip
    Holland

Plaintiff
    (Respondent)

and

The Islamic Republic of Iran,

the Iranian Ministry of Information and Security

and
    the Iranian Revolutionary Guard Corps

Defendants
    (Appellants)

AND BETWEEN

American Center for Civil Justice, Inc., as Assignee

For
    Christine Higgins

Plaintiff
    (Respondent)

and

The Iranian
    Revolutionary Guard Corps

Defendant
    (Appellant)

AND BETWEEN

Katie L. Marthaler, Herman C. Marthaler, III,

Matthew
    Marthaler, Kirk Marthaler, Richard W. Wood, Kathleen

M.
    Wood, Shawn M. Wood, Francis Heiser, Denise M. Eichstaedt, Anthony W.

Cartrette, Lewis W. Cartrette, Thaddeus C. Fennig,
    Catherine Fennig, Paul D. Fennig, Mark Fennig, Catherine Adams, Mary Young,
    Daniel Adams, Elizabeth Wolf, Patrick D. Adams, John E. Adams, William Adams,
    Michael T. Adams, Christopher R. Nguyen, Bridget Brooks, James R. Rimkus, Anne
    M. Rimkus, Steve K. Kitson, Nancy A. Kitson, Lawrence E. Taylor, Vickie L.
    Taylor, Starlina D. Taylor, Dawn Woody, Bernadine R. Beekman, Tracy M. Smith,
    Jonica L. Woody, Timothy Woody, Ibis S. Haun, Senator Haun, Milagritos
    Perez-Dalis, Cecil H. Lester, Sr., Judy Lester, Cecil H. Lester, Jr., Jessica
    F. Lester, Shyrl L. Johnson, Kevin Johnson, Jr., Nicholas A. Johnson, A Minor,
    By His Legal Guardian Shyrl L. Johnson, Michael Morgera, Thomas Morgera, Marie
    R. Campbell, Bessie A. Campbell, James V. Wetmore, George M. Beekman, Che G.
    Colson, Bruce Johnson, Estate Of Brent E. Marthaler, Estate Of Sharon
    Marthaler, Estate Of Michael Heiser, Estate Of Gary Heiser, Estate Of Patrick
    P. Fennig, Estate Of Christopher Adams, Estate Of Thanh Van Nguyen, Estate Of
    Sandra M. Wetmore, Estate Of Kendall Kitson, Jr., Estate Of Kendall K. Kitson,
    Sr., Estate Of Nancy R. Kitson, Estate Of Joshua E. Woody, Estate Of Leland
    Timothy Haun, Estate Of Christopher Lester, Estate Of Kevin J. Johnson, Sr.,
    Estate Of Millard D. Campbell, Estate Of Peter J. Morgera, Estate Of Justin R.
    Wood, Estate Of Earl F. Cartrette, Jr., Estate Of Brian Mcveigh, Estate Of
    Joseph E. Rimkus, Estate Of Jeremy A. Taylor, Estate Of Laura E. Johnson, Paul
    Alexander Blais, Estate Of Curtis Taylor, Maria Taylor, Cielito Valencia, Luz
    Southard, Steven Wolfe, Sonya Turner Broadway, Estate Of Betty Welch, Gerard
    Welch, Michael Welch, Richard Paul Brewer, Joyce Louise Leydet, Diana
    Campuzano, Avi Elishis, Gregg Salzman, Donna Marie Holland, James Robert
    Holland, Elisa Nili Cirilo Peres Ben-Rafael, Yonatan Mishael Benrafael, A Minor
    By His Litigation Guardian Elisa Nili Cirilo Peres Ben-Rafael, Ralph Goldman,
    Noa Ruth Ben-Rafael, Judith Goldman Baumgold And Naomi Goldman

Plaintiffs
    (Respondents)

and

The Islamic Republic of Iran, the Iranian Ministry of
    Information and Security,

And the Iranian Revolutionary Guard Corps

Defendants
    (Appellants)

Colin Stevenson and J. Daniel McConville for the
    appellants

John Adair and Gordon McGuire for the respondents, Tracy
    and Bennett

John B. Laskin, Sarah Whitmore, Eliot Che for the
    respondents, Marthaler, Holland and American Center for Civil Justice, Inc.

Jacqueline Dais-Visca, and Joseph Cheng for the
    intervener, the Attorney General of Canada

Heard: April 18, 2017

On appeal from the orders of Justice Glenn A. Hainey of
    the Superior Court of Justice, dated June 9, 2016, with reasons reported at
    2016 ONSC 3759, 400 D.L.R. (4th) 670.

COSTS ENDORSEMENT

[1]

In our decision dated June 30, 2017, we dismissed the appeals in their
    entirety, save for the appeals in the actions commenced by the respondents
    Welch, Brewer and Holland. Those appeals were allowed and the actions were
    struck.

[2]

We have now received the parties costs submissions. We would not give
    effect to Irans submission that no costs should be awarded because the issues
    on appeal were novel. They were not. Iran raised numerous grounds of appeal and
    there was jurisprudence on most of the issues raised.

[3]

We are also not satisfied that the respondents are entitled to costs on
    a substantial indemnity basis or that the respondents Welch, Brewer and Holland
    should receive costs even though their actions were dismissed. In our view,
    there should be a reduction to the costs sought in the bill of costs filed by
    the lawyers representing those respondents to reflect the mixed success on
    those appeals.

[4]

We order the appellants to pay costs on a partial indemnity scale to the
    respondents represented by Adair Barristers LLP in the amount of $70,000 and to
    the respondents represented by Torys LLP in the amount of $80,000. Both amounts
    are inclusive of fees, disbursements and applicable H.S.T.

Alexandra
    Hoy A.C.J.O.

R.A. Blair
    J.A.

C.W.
    Hourigan J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Welton Estate v. Haugrud, 2017 ONCA 831

DATE: 20171030

DOCKET: C63326

MacFarland, Hourigan and Pardu JJ.A.

In the Matter of the Estate of David Munro
    Welton, deceased

BETWEEN

The Bank of Nova Scotia Trust Company in its
    capacity as Estate Trustee of the Estate of David Munro Welton

Applicant (Respondent)

and

Catherine Haugrud, Kym Welton, David Munro Welton
    Jr.,
Darlene Alice May Welton
, Morgan Welton, Gray
    Welton, Jack Haugrud, Emma Haugrud, and The Childrens Lawyer

Respondents (Appellant)

Robert Rueter and David Barbaree, for the appellant

Craig Vander Zee, for the respondent The Bank of Nova
    Scotia in its capacity of Estate Trustee

Justin de Vries, for the respondent Catherine Haugrud

Michael Bordin and Karen Watters, for Simpson Wigle Law
    LLP

Bianca La Neve, for the Office of the Childrens Lawyer

Heard and released orally: October 23, 2017

On appeal from the order of Justice Ruth Mesbur of the Superior
    Court of Justice, dated December 29, 2016.

REASONS FOR DECISION

[1]

The appellant who is the widow of the deceased testator did not
    challenge the will and elected to take under the will. In these circumstances,
    the motion judge was correct to proceed with the rectification motion before
    her. That motion, which was opposed only by the appellant, was to correct an
    error the drafting solicitor conceded he made, one where his evidence was
    corroborated by that of the deceaseds accountant. In our view, the deceaseds
    intention to liquidate sufficient shares that he owned to provide two of his
    children with $1 million each was apparent on the face of the will and
    redemption of 150 class D shares which he did not own when the will was
    drafted, would not have in any event have provided this necessary funding. In
    these circumstances, the motion judge made no error in receiving Mr. Milnes
    evidence.

[2]

The motion judge relied on correct legal principles as set out in
Robinson
    Estate v. Robinson
, 2011 ONCA 493 and applied those principles correctly. The
    factual findings are amply supported by the evidence she had before her. In our
    view, this appeal is simply an effort to have this court re-hear the issues
    that were before the motion judge, but to decide them differently. That is not
    the role of this court.

[3]

The appellant also seeks leave to appeal the motion judges costs
    disposition. It goes without saying that leave to appeal costs is sparingly
    granted and only where there has been an error in principle, or where the
    result is plainly wrong will this court intervene.

[4]

The argument before us seems to be that in not granting her costs below,
    and requiring her contribution to some of the other parties, the motion judge
    failed to take into consideration the public policy aspects of estate
    litigation. And accordingly it was unfair to deny the appellant her costs
    below and to require her contribution to the difference between full and
    partial indemnity costs to the other parties.

[5]

We disagree. It is clear from her endorsement that the motion judge was
    alive to the different considerations that apply in estate matters in relation
    to public policy issues: see para. 16 of her reasons. Her endorsement in
    relation to costs is reflective of the evidentiary findings she made on the
    particular facts of the case before her. We would not interfere, and leave to
    appeal is denied.

[6]

In the result, the appeal is dismissed as is the motion for leave to
    appeal costs.

[7]

In our view, all of the parties should receive their partial indemnity
    costs payable by the appellant. The estate trustee, Bank of Nova Scotia is
    entitled to its full indemnity costs  of $16,410.99 payable as follows:

-

by the appellant, its partial indemnity costs of $9625.34;

-

the balance of $6785.65 by the estate.

[8]

The Childrens Lawyer should receive its full indemnity costs of $10,000
    payable as follows:

-

Its partial indemnity costs of $7000, by the appellant;

-

the balance of $3000 by the estate.

[9]

Catherine Haugrud should have her full indemnity costs of $49,206.26
    payable as follows:

-

by the appellant, her partial indemnity costs of $28,856.25;

-

and the balance of $20,305.01 from the estate.

[10]

The
    non-party lawyer should receive his partial indemnity costs only in the sum of
    $33,957.89 from the appellant.

[11]

All
    figures are inclusive of disbursements and HST.

J. MacFarland J.A.

C.W. Hourigan J.A.

G. Pardu J.A.