COURT OF APPEAL FOR ONTARIO

CITATION: Glegg v. Glass, 2020 ONCA 833

DATE: 20201222

DOCKET: C67716

Pepall, van Rensburg and Brown
    JJ.A.

BETWEEN

Robert Glegg

Applicant (Appellant)

and

Lorne Glass, Christina
    Doris/Christen Seaton Burrison Hudani LLP, Justice for Children and Youth/Legal
    Aid Ontario, and Linda Sapiano

Respondents (Respondents)

James Zibarras, for the appellant

James R. G. Cook and James Beesley, for
    the respondent, Lorne Glass

Ian McKellar, for the respondents,
    Christina Doris and Christen Seaton Burrison Hudani LLP

Heard: October 19, 2020 by video conference

On appeal from the order of Justice Paul
    M. Perell of the Superior Court of Justice, dated November 18, 2019, with
    reasons reported at 2019 ONSC 6623, 34 R.F.L. (8th) 394.

BROWN J.A.:

I.        OVERVIEW

[1]

The appellant, Robert Glegg, an Ontario
    resident, is suing his ex-wife, Katalin Van Den Hurk, and her husband, Richard
    Peacey, in Florida for damages for parental alienation from his daughter,
    Olivia, now an adult. In the Florida proceeding, the appellant obtained letters
    of request that sought the assistance of the Ontario courts in obtaining the
    production of documents from the former lawyers for his ex-wife and daughter.
[1]
The application judge
    dismissed the application on the basis that it would be contrary to public
    policy to enforce the letters of request.

[2]

The appellant advances two main grounds of
    appeal. First, he argues that the application judge conducted the hearing in a
    procedurally unfair manner. Second, he contends the application judge erred in
    law by concluding that enforcing the letters of request would offend the public
    policy of this province.

[3]

I would dismiss the appeal. As I explain below,
    in my view there was no unfairness in the process the application judge
    followed. Further, the application judge properly applied the public policy
    analysis in declining to enforce the letters of request on the basis that they
    would interfere with solicitor-client privilege and confidentiality. This was a
    sufficient basis upon which to dismiss the application.

II.       SUMMARY OF THE MATERIAL EVENTS

The Ontario custody and child support
    litigation

[4]

The appellant and Ms. Van Den Hurk married in
    1998, separated in 2001, and divorced in 2002. Their daughter, Olivia, was born
    in 1999. Pursuant to a separation agreement dated April 20, 2001, mother and
    father had joint custody of Olivia and each agreed to live within a stipulated
    distance of Oakville until she turned 18.

[5]

In November 2013, Ms. Van Den Hurk and Mr.
    Peacey moved to Florida. Olivia visited her mother in Florida in August 2014,
    at which time she was 15 years old. Following Olivias arrival in Florida, Ms.
    Van Den Hurks Ontario counsel wrote the appellant to advise that Olivia did
    not want to return to Ontario and had enrolled in a Florida high school.

[6]

In September 2014, the appellant commenced
    litigation against his ex-wife in Ontario and Florida that resulted in Olivias
    return to Ontario. Extensive litigation ensued in Ontario regarding custody of
    and support for Olivia. The details of that litigation have been canvassed at
    length in the reasons of Gray J. dated October 30, 2017 (
O.G. v. R.G
.,
    2017 ONSC 6490, 97 R.F.L. (7th) 295), the reasons of this court dated February 9,
    2017 (
R.G. v. K.G.
, 2017 ONCA 108, 136 O.R. (3d) 689), and the reasons
    of the application judge, at paras. 26 to 89. There is no need to repeat them.
    For the purposes of this appeal, the following brief summary of the facts will suffice.

[7]

When Olivia turned 16 years old, she sought and
    obtained an order from an Ontario court that she had withdrawn from her
    parents control. The appellant sought to overturn the withdrawal order. His
    efforts to do so were ended by this courts February 9, 2017 decision. In its
    reasons, this court stated, at paras. 40 and 67:

[The appellants] continued pursuit of this
    issue confirms [Olivias] position that he is obsessed with controlling her and
    that this has blinded him to the reality that it is he, not her mother, who is
    the reason that she withdrew from parental control. It also reinforces the
    strength of the findings in the courts below.

The degree to which the court will follow the
    wishes of the child will depend upon the age and level of maturity of the child
    and will be subject to the judge's discretion as she seeks to determine the
    child's best interests. When, as here, the child is months away from her
    eighteenth birthday, a continuation of litigation involving her indicates more
    about the parent's needs than the child's.

[8]

In 2016, Olivia commenced an application for
    child support against her father, which he resisted. Although Olivia obtained
    orders for interim child support, on December 13, 2017 she withdrew her
    application. The Ontario proceedings in respect of her custody and support
    thereby ended.

The Florida Action and Letters of Request

[9]

In July 2018, the appellant commenced a
    proceeding in the Circuit Court of the Seventeenth Judicial Circuit in and for
    Broward County, Florida (the Florida Court) against Ms. Van Den Hurk and Mr.
    Peacey (the Florida Action). As described in his Verified Complaint, the
    appellant seeks to recover from his ex-wife and her husband $9.6 million in damages,
    including punitive damages should such award be appropriate, arising from an
    intentional course of conduct by Defendants to interfere with the custodial
    rights of Plaintiff and to intentionally cause economic, emotional, and psychological
    harm to Plaintiff. The appellants Verified Complaint asserts two counts
    against his ex-wife and her husband: (i) intentional interference with
    custodial rights granted by Ontario court orders, including orchestrating the
    daughters proceedings for a declaration that she was free from parental
    control; and (ii) intentional infliction of emotional distress resulting from
    the alleged interference in the appellants custodial rights, including the
    violation of Ontario court orders.

[10]

In May and June 2019, the appellant sought and
    obtained two letters of request from the Florida Court seeking the assistance
    of Ontario courts to secure the production of documents for use in the Florida
    Action (the Letters of Request). Specifically, the Letters of Request sought
    production of documents from two former lawyers for Ms. Van Den Hurk, Linda
    Sapiano and Christina Doris, as well as from lawyers who had acted for Olivia,
    Lorne Glass and Justice for Children and Youth (JFCY). The Subpoenas for
    Production of Documents from Non-Party attached to the Letters of Request
    describe the documents for which production is sought. Appendix A to these
    reasons reproduces the Subpoena directed to Mr. Glass. The Subpoena states that
    for some, but not all, categories of documents sought, attorney-client
    privileged/work production privileged information may be redacted.

The Ontario enforcement application

[11]

In July 2019, the appellant commenced an
    application seeking to enforce the Letters of Request against Ms. Sapiano, JFCY,
    Mr. Glass, and Ms. Doris, together with her law firm, Christen Seaton Burrison
    Hudani LLP.

[12]

The application was withdrawn against Ms.
    Sapiano.

[13]

Responding materials were filed by the remaining
    respondents. Cross-examinations were conducted of the appellant, Ms. Doris, and
    Ms. Mary Birdsell, a lawyer and JFCYs executive director.

[14]

The events surrounding the return of the
    application are relevant to the appellants grounds of appeal, so they require
    some elaboration. Prior to the return of the application, the appellant reached
    a settlement with Ms. Sapiano and Ms. Doris in which he agreed to withdraw the
    application against Ms. Sapiano, and in which Ms. Doris agreed not to oppose
    the application provided the redaction of privileged information applied to all
    categories of documents. On the return of the application, the application
    judge was informed that the appellant was withdrawing the application against
    Ms. Sapiano and Ms. Doris was not opposing the proceeding: at paras. 15, 19, and
    22. It does not appear that the application judge was told the terms of the
    settlement.

[15]

On the return of the application, the appellant also
    sought an adjournment of the proceeding against JFCY. As explained in his
    reasons, at para. 20, the application judge refused to adjourn the application
    against JFCY unless the entire application was adjourned since the appellants
    application could not properly be heard seriatim, because the whole factual
    record was relevant and had been relied on. For instance, the application
    judge noted that the appellant, in his application as against Mr. Glass, was relying
    on information from the affidavit and cross-examination of Ms. Birdsell and
    that the positions being taken by the parties were intertwined.

[16]

Following a brief recess, the appellant advised
    that he was withdrawing his application with prejudice against JFCY: at para.
    21.

[17]

The application then proceeded against Mr.
    Glass, Ms. Doris, and her law firm.

[18]

The application judge dismissed the application.
    He concluded that it would be against public policy to enforce the Letters of
    Request for two reasons. First, it would offend public policy to enforce letters
    of request from a foreign court in aid of a cause of action that is forbidden
    in Ontario: at para. 122. Second, he concluded that the application should be
    dismissed because it interfered with solicitor-client privilege and client
    confidentiality, notions fundamental to the administration of justice and to
    the Canadian legal system: at para. 134.

[19]

The application judge also directed the
    appellant to deliver copies of his reasons to the presiding judge in the
    Florida Court and to this court, which was scheduled to hear an appeal in
    criminal proceedings the appellant had attempted to initiate against Ms. Van Den
    Hurk: at para. 143.

iii.      ISSUES
    ON APPEAL

[20]

The appellant submits that the order of the
    application judge should be set aside and an order enforcing the Letters of Request
    should issue. The appellant argues the application judge made two types of
    errors:

(1)

Procedural errors that rendered the hearing process unfair, namely:

(a)

reviewing and relying on materials not properly before the court;

(b)

ordering relief not sought by the parties; and

(c)

relying on legal theories not raised by the parties.

(2)

Substantive errors of law regarding the scope of the public policy
    ground to refuse the enforcement of letters of request, namely in concluding that:

(a)

the Letters of Request would interfere with solicitor-client
    privilege and client confidentiality; and

(b)

it would be contrary to public policy to enforce the Letters of
    Request in aid of a cause of action that is forbidden in Ontario.

IV.     ISSUE
    1: WAS THE HEARING PROCEDURALLY UNFAIR?

[21]

The appellant advances an overarching submission
    that the application judge exceeded his role as a judge and assumed the role of
    an advocate, to the prejudice of the appellant. The appellant points to three
    specific instances of such conduct that, he contends, rendered the hearing
    process unfair.

Issue 1(a): The improper reliance on certain
    of the application materials

[22]

First, the appellant argues that the application
    judge acted unfairly by engaging in independent investigations and reviewing
    materials that were not properly before him.

[23]

The application judges reasons contain a
    lengthy description of the history of the custody and support litigation that
    took place in Ontario and Florida prior to the appellants initiation of the Florida
    Action. The appellant complains that this description was almost entirely
    drawn from materials not before the Application Judge at the hearing, including
    the Surplus Materials, as well as Florida and Ontario decisions. He argues
    that the application judge should have invited appellants counsel to make submissions
    on those facts.

[24]

In his factum, the appellant coined the term
    Surplus Materials to describe materials that certain parties had filed with
    the court but which the appellant did not list in his Confirmation of
    Application, specifically: (a) the affidavit and cross-examination transcript
    of Ms. Birdsell, the affiant for JFCY; (b) the responding Application Record of
    Doris; (c) the responding Factum and Book of Authorities of JFCY; and (d) court
    decisions in Florida and Ontario. Since the application against JFCY was
    withdrawn at the hearing and Ms. Doris did not oppose the application, the
    appellant contends that the application judges use of their materials amounted
    to an impermissible independent investigation. According to the appellant, this
    deprived him of a fair opportunity to correct or contradict the facts asserted
    in those materials.

[25]

I see no merit in this submission for several
    reasons.

[26]

First, the appellants own litigation conduct
    undermines his submission. In his main factum on the application, the appellant
    referred to some of the so-called Surplus Materials. Although the appellant
    criticizes the application judge for referring to the evidence of Ms. Birdsell
    from JFCY, the appellant referred to her affidavit and cross-examination at paras.
    33, 61 and 71 of his main factum. This quite understandably led the application
    judge to describe the positions being taken by the parties as intertwined: at
    para. 20.

[27]

As well, one exhibit to the appellants
    affidavit in support of the application was his Verified Complaint in the
    Florida Action, to which were attached several of the Ontario and Florida
    custody orders. The responding materials filed by Ms. Doris and JFCY reproduced
    some of the other orders made in those proceedings. It was open to the
    application judge to consider all of the orders to gain an accurate
    understanding of the events that led to the issuance of the Letters of Request.
[2]

[28]

Second, I do not accept the appellants
    submission that the application judge could only refer to materials that the
    appellant had listed in the Confirmation Form he filed for the return of the
    application.

[29]

Rule 38.09.1(1) of the
Rules of Civil
    Procedure
requires the party who makes an application on notice to give the
    registrar, at least three days before the hearing date, a confirmation of
    application using Form 38B. If no confirmation is given, the application will
    not be heard except by order of the court: r. 38.09.1(2). Regional practice may
    modify the content of confirmation form. The modified Form 38B used in the
    Toronto Region requires counsel to identify the materials that have been filed
    and will be relied upon for the hearing of the application. As the form states,
    it must be attached to the materials being filed and all materials to be
    relied on at hearing must be filed in one complete package within the required
    timelines.
[3]

[30]

As is apparent from the language on the Toronto
    Regions modified confirmation form, the document operates as a device that
    assists court staff in the Civil Scheduling Unit to identify the materials that
    should be delivered to the judge hearing an application or motion. The form
    does not act as some sort of administrative constraint on a judges discretion
    to determine the materials that are in fact relevant to the decision he has to
    make.

[31]

Third, when the application judge refused to
    adjourn the application as against JFCY, he advised the parties that Mr.
    Gleggs application could not properly be heard seriatim, because the whole
    factual record was relevant and had been relied on: at para. 20. Yet, in oral
    argument, appellants counsel did not dispute the proposition that on the
    return of the application no party asked the application judge to disregard
    specific materials.

[32]

Fourth, in response to a question from the bench,
    appellants counsel clarified that his client was not taking the position that
    the application judges summary of the facts was based on inadmissible evidence.
    Instead, the appellant submitted that much of that summary was irrelevant to
    the application to enforce the Letters of Request, where the focus should be on
    the Florida Action.

[33]

I disagree. First, as noted at para. 27, the
    appellants Verified Complaint filed in support of the application to enforce
    the Letters of Request described and attached several of the orders made in the
    Ontario custody proceedings. Second, in considering whether to enforce letters
    of request, a judge must determine whether the request imposes any limitation
    or infringement on Canadian sovereignty and whether justice requires an order
    for the taking of commission evidence:
Lantheus Medical Imaging Inc. v.
    Atomic Energy of Canada Ltd.
, 2013 ONCA 264, 115 O.R. (3d) 161, at para. 59.
    To make that determination, a judge must understand the circumstances that led
    to the issuance of the letters of request. That is especially so in the unusual
    circumstances presented by this case, where extensive litigation in Ontario
    preceded the initiation of the foreign proceeding in which the Letters of Request
    were issued.

[34]

Accordingly, I am not persuaded that the
    application judge improperly relied on some of the application materials filed
    with the court.

Issue 1(b): Ordering relief not sought by the
    parties

[35]

The application judge ordered the appellant to
    deliver copies of his reasons to the presiding judge in the Florida Court and
    to this court in advance of the hearing of his appeal of the stay of his
    private prosecution of criminal charges against his ex-wife: at para. 144. The
    appellant submits that since no party had asked for such relief, the
    application judge did not have the authority to make those directions. He
    contends that the application judges directions had a deleterious effect on
    the integrity and fairness of those other proceedings.

[36]

I do not accept this submission. The application
    judge had the authority to make the direction he did. Rule 38.10(1)(a) provides
    that a judge hearing an application may grant the relief sought or dismiss or
    adjourn the application, in whole or in part and with or without terms. It was
    open to the application judge to direct the delivery of his reasons to other
    courts as a term of his dismissal of the application.

[37]

Moreover, no prejudice could result from the
    application judges direction. The Florida Court was entitled to be told, as a
    matter of comity, the reasons why the Ontario court declined to enforce its Letters
    of Request. Further, when this court hears the appellants appeal regarding the
    stay of his private prosecution against his ex-wife, no doubt the appellant can
    make submissions about the relevance or irrelevance and accuracy or inaccuracy of
    the facts set out in the application judges reasons. This court will decide
    his appeal on the proper record.

Issue 1(c): Relying on legal theories not
    raised by parties

[38]

The final procedural error asserted by the
    appellant is that the application judge considered and relied on a legal theory
    not raised by counsel and without giving appellants counsel an opportunity to
    make responsive submissions.

[39]

In his reasons, the application judge concluded
    that it would be contrary to public policy to enforce the Letters of Request
    from the Florida Court in aid of a cause of action that was forbidden in Ontario.
    Citing the case of
Frame v. Smith
, [1987] 2 S.C.R. 99, the application
    judge held that in Ontario a parent could not sue his spouse or third parties
    for interfering with the parents relationship with his children and denying
    him the opportunity to give the children parental love, care, and guidance: at
    paras. 122 and 123.

[40]

The appellant submits that the issue of whether
    the Florida Action offended public policy was not raised at the hearing by the
    parties or the application judge, nor did the application judge ask the parties
    for submissions on
Frame v. Smith
. As a result, the application was
    decided without submissions from the appellant on
Frame v. Smith
,
    thereby denying him a fair opportunity to respond, resulting in prejudice to
    the appellant.

[41]

I do not accept the appellants submission. The
    record discloses that the application judge followed a fair process.

[42]

The appeal record does not contain a transcript
    of the hearing before the application judge. However, at the conclusion of the
    hearing on October 28, 2019, the application judge reserved his decision and
    wrote, in a brief endorsement:

[The appellant] is at liberty to file any
    additional authorities and written argument on the issue of whether, apart from
    the issue of solicitor-client privilege, there are other public policy issues
    relevant to the enforcement of letters rogatory, that are relevant to the
    request being made in the immediate case.

[43]

Pursuant to that endorsement, the appellant
    filed a supplementary factum dated November 4, 2019. The second part of that
    factum bore the heading: The underlying substantive claims in the Florida
    Action do not have to be recognized claims in Ontario. Under that heading, the
    appellant submitted that in determining whether to enforce letters of request,
    the inquiry is limited to whether the production of the evidence or documents sought
    would be contrary to public policy, not to a consideration of the substantive
    claims underlying the foreign litigation. The appellant argued that the
    substantive claims underlying the Florida Action did not form a proper legal
    or other basis for refusing to grant the requested [Letters of Request].

[44]

While the appellants supplementary factum did
    not refer to the decision in
Frame v. Smith
, the second part of that
    document clearly reveals the appellant understood that the application judge
    was considering whether the fact that Ontario law did not recognize the cause
    of action asserted in the Florida Action might bar enforcement of the Letters
    of Request on the grounds of public policy. Consequently, I see no unfairness
    in the process followed by the application judge.

Conclusion on Issue 1

[45]

For these reasons, I am not persuaded that the
    appellant was denied procedural fairness in the hearing before the application
    judge.

V.

ISSUE 2: DID THE APPLICATION JUDGE ERR IN HIS
    PUBLIC POLICY ANALYSIS?

The public policy issue stated

[46]

The application judge dismissed the appellants
    application to enforce the Letters of Request on the basis that they
    contravened public policy in two respects:

(a)
the Letters of Request interfere with
    solicitor-client privilege and client confidentiality, notions fundamental to
    the administration of justice and to the Canadian legal system: at para. 134, and

(b)
it would be contrary to public policy to
    enforce the Letters of Request in aid of a cause of action that is forbidden in
    Ontario: at para. 122.

[47]

The appellant appeals both conclusions.

The applicable legal principles

[48]

Before considering the parties submissions, a
    brief summary is in order of the principles regarding the scope of the public
    policy factor used in the analysis to determine whether to enforce letters of
    request.

[49]

Foreign letters of request are to be given full
    force and effect by domestic courts unless they are contrary to public policy
    or otherwise prejudicial to the sovereignty or the citizens of the jurisdiction
    to which the request is directed:
Gulf Oil Corporation v. Gulf Canada Ltd.
    et al.
, [1980] 2 S.C.R. 39;
R. v. Zingre
, [1981] 2 S.C.R. 392, at
    p. 401;
Presbyterian Church of Sudan v. Taylor
(2006), 275 D.L.R.
    (4th) 512 (Ont. C.A.), at para. 17. In considering a request to enforce, a
    court must balance the possible infringement of Canadian sovereignty with
    whether justice requires an order for the taking of commission evidence, in
    view of the natural desire to assist foreign courts:
Zingre
, at p.
    403. As put in
Lantheus
, at para. 59, quoting
France (Republic) v.
    De Havilland Aircraft of Canada Ltd.
(1991), 3 O.R. (3d) 705 (C.A.), at
    para. 37, the test requires that the court:

[C]onsider whether the request imposes any
    limitation or infringement on Canadian sovereignty, and whether justice
    requires an order for the taking of commission evidence. The considerations
    encompassed by the phrase Canadian sovereignty  include an assessment of
    whether the request would give extra-territorial authority to foreign laws
    which violate relevant Canadian or provincial laws ; whether granting the
    request would infringe on recognized Canadian moral or legal principles ; and
    whether the request would impose an undue burden on, or do prejudice to, the
    individual whose evidence is requested.

[50]

In conducting this balancing exercise, a court
    considers whether the evidence, including the letters of request, establishes
    the six non-exhaustive factors set out in
Re Friction Division Products,
    Inc. and E.I. Du Pont de Nemours & Co. Inc. et al.

(No. 2)
(1986),
    56 O.R. (2d) 722 (H.C.), at p. 732, and
Fecht v. Deloitte & Touche
(1996), 28 O.R. (3d) 188 (Gen. Div.), at p. 194, affd (1997) 32 O.R. (3d) 417
    (C.A.).
[4]
These factors operate as useful guideposts, not rigid pre-conditions, to the
    exercise of a judges discretion:
Lantheus
, at paras. 61 and 69;
Perlmutter
    v. Smith
, 2020 ONCA 570, 152 O.R. (3d) 185, at para. 25.

[51]

One of the factors is whether enforcing the letters
    of request would be contrary to public policy:
Treat America Ltd. v. Nestlé
    Canada Inc.
, 2011 ONCA 560, 340 D.L.R. (4th) 707, at para. 12. In
    considering this factor, the court focuses on whether it would be contrary to
    the public interest to require the production of the evidence or documents
    sought. In
Re Westinghouse Electric Corporation and Duquesne Light Co.
(1977), 16 O.R. (2d) 273 (H.C.), the letters of request sought the production
    of documents that were subject to federal regulations prohibiting their
    disclosure. The court declined to enforce the letter of request. One factor militating
    against enforcement was the Government of Canadas policy that the information
    and documents sought should not be disclosed. The court concluded that, in exercising
    its discretionary power to enforce letters of request, it should take judicial
    cognizance of the stated public policy and not force the disclosure of
    information if to do so would, on the authority of the Government, be harmful
    to the public interest: p. 290. The decision in
Westinghouse Electric
was cited with approval by the Supreme Court of Canada in
Gulf Oil
, at
    pp. 56-58.
[5]

Issue 2(a): The solicitor-client privilege
    public policy ground

[52]

The application judge stated that the Letters of
    Request offended public policy because they sought documents to which
    solicitor-client privilege applied or presumptively applied. He held that, to
    the extent some of the documents fell in the territory of administrative
    information relating to the solicitor-client relationship, the appellant had
    not rebutted the presumption of privilege by evidence showing that there is no
    reasonable possibility that disclosure of the requested information would lead
    to the revelation of confidential information, or that the requested
    information was not linked to the merits of the case: at para. 142. The
    application judge also concluded that, in the circumstances, a privilege log
    approach would not be appropriate as it would require the lawyers to breach
    their professional duty of confidence and violate solicitor-client privilege:
    at paras. 140-41.

[53]

In his notice of appeal, the appellant alleges several
    errors committed by the application judge in respect of those findings. The
    main points are that the application judge erred by: finding the lawyers
    communications with third parties were privileged or confidential; misapplying
    solicitor-client privilege to third party communications that are not protected
    by the privilege; finding that a privilege log would breach solicitor-client
    privilege and offend public policy; and holding that the appellant was required
    to show there is no reasonable possibility that the disclosure of the requested
    information would lead to the revelation of solicitor-client communications.

[54]

Although the appellant did not address the issue
    in his factum, at the hearing appellants counsel submitted that: the
    application judges reasons on the issue of solicitor-client privilege were
obiter
;
    the appellant has never asked for privileged documents; the appellant had
    offered to pay the respondents for the time they spent complying with the
    Letters of Request, including any privilege review; and an Ontario court would
    adjudicate any disputes regarding privilege claims.

[55]

I am not persuaded by the appellants
    submissions.

[56]

The decision to grant or refuse a foreign
    request is a matter of judicial discretion to which this court must give
    deference in the absence of a demonstrated error in principle by the court
    below, which would include a misapprehension of or failure to take into account
    the evidence, or a clearly wrong or unreasonable result:
Presbyterian
    Church
, at paras. 19 and 30;
Perlmutter
, at para. 26;
Young
    v. Tyco International of Canada Ltd.
, 2008 ONCA 709, 92 O.R. (3d) 161, at
    para. 27. I see no such error.

[57]

First, the application judges conclusion on solicitor-client
    privilege was not
obiter
. His reasons are clear that it was a discrete
    basis on which he dismissed the application as contrary to public policy: at
    paras. 134 and 143.

[58]

Second, the application judge rejected the
    appellants contention that he was not seeking documents protected by
    solicitor-client privilege as sophistry. I think that finding was apt: at
    para. 139.

[59]

As can be seen from the Subpoena attached to the
    Letters of Request, a copy of which can be found at Appendix A, the Letters
    of Request commanded the former lawyers for Ms. Van Den Hurk and Olivia to
    produce six categories of documents:

(a)

Four of the categories describe documents that Ontario law
    classifies as subject to solicitor-client privilege or presumptively so
    privileged:

·

Category 1: retainer agreements;

·

Category 2: dockets and billing information;

·

Category 3: information regarding the payment of
    legal fees; and

·

Category 4: information regarding the payment of
    expert fees.

(b)

The other two categories describe documents that might be subject to
    solicitor-client privilege or litigation privilege, depending upon the specific
    circumstances:

·

Category 5: the names, dates, email addresses,
    phone numbers and call logs of communications the lawyer had with persons other
    than the client in which the lawyer communicated in conjunction with the
    representation of the client; and

·

Category 6: documents, photographs or tangible
    evidence provided to the lawyer by a person other than the client in
    conjunction with the lawyers representation of the client.

[60]

The Letters of Request stipulate that the
    documents sought under Categories 2, 4, 5 and 6 may be redacted for
    attorney-client privileged/work product privileged information. As well, the
    Letters of Request would require the targeted lawyer to provide a list, or privilege
    log, of documents withheld as privileged, although the log would have to
    provide a general description of the subject matter to which the document
    relates.

[61]

No evidence was placed before the application
    judge that either of the two clients  Ms. Van Den Hurk or Olivia  had
    consented to the release of the documents or information sought.

[62]

On their face, the documents sought in
    Categories 1 through 4 of the subpoenas attached to the Letters are protected,
    or presumptively protected, by solicitor-client privilege:
Descôteaux et
    al. v. Mierzwinksi
, [1982] 1 S.C.R. 860, at pp. 892-93;
Maranda v.
    Richer
, 2003 SCC 67, [2003] 3 S.C.R. 193, at paras. 30-33; Sopinka,
    Lederman & Bryant
, The Law of Evidence in Canada
, 5th ed. (Toronto:
    LexisNexis, 2018), at §14.76-14.88.

[63]

Those in Categories 5 and 6 patently fall within
    the ambit of the principle of litigation privilege, as the subpoenas seek
    documents or information communicated to the target lawyers in conjunction with
    their consultations with or representations of Ms. Van Den Hurk or Olivia.

[64]

While litigation privilege usually ends when the
    litigation ends, it continues where litigants or related parties remain locked
    in what is essentially the same legal combat:
Blank v. Canada (Minister of
    Justice)
, 2006 SCC 39, [2006] 2 S.C.R. 319, at para. 34. Related
    litigation includes separate proceedings that involve the same or related
    parties and arise from the same or a related cause of action, or proceedings
    that raise issues common to the initial action and share its essential purpose:
Blank,
at para. 39. The application judge wrote that Olivias
    withdrawal of her application for child support did not bring a ceasefire to
    the family battles. Instead, it appeared that the appellant sought to continue
    the hostilities by commencing his Florida Action: at para. 90. The history of
    the parties custody litigation provided support for that observation. As well,
    the history and character of the litigation strongly suggest that, for the
    purposes of determining whether litigation privilege continues to apply to the
    Categories 5 and 6 documents, the Florida Action would constitute litigation
    related to the terminated Ontario proceedings.

[65]

Accordingly, the Letters of Request seek facially
    privileged information and documents in the possession of the former lawyers
    for Olivia and Ms. Van Den Hurk related to the work the lawyers performed for
    those clients in respect of Ontario litigation, and in respect of which the
    clients have not waived privilege. In my view, those circumstances will
    inevitably give rise to disputes over any privilege claimed by the targeted
    lawyers on behalf of their former clients. Appellants counsel submits that
    those disputes can be determined by way of a motion before an Ontario court. With
    respect, I see no reason why Ontario courts should devote any more resources to
    the appellants custody-related litigation that this court ended in 2017.

[66]

I would make one further observation, although
    it is not strictly tied to the privilege issue. It is clear that in the Florida
    Action the appellant seeks to put in issue the validity of decisions of the Ontario
    courts, including this court, and he seeks to use the Letters of Request to
    obtain evidence to support his position: Verified Complaint, para. 32. In his
    discussion of the public policy factor, the application judge wrote that it
    would not be appropriate for a foreign court to support this collateral attack
    on the decisions of the domestic court and it would be inappropriate for the
    foreign court to rule on the probity of proceedings in Ontario: at para. 129.

[67]

I
    agree. For the Letters of Request to seek evidence that the appellant plainly
    intends to use to attack orders made by Ontario courts amounts to a potential
    infringement of Canadian sovereignty.

Conclusion on Issue 2(a)

[68]

For
    those reasons, I see no reversible error in the application judges exercise of
    his discretion to decline to enforce the Letters of Request on the ground of
    public policy because they would improperly interfere with solicitor-client
    privilege and confidentiality.

[69]

That
    is sufficient to dismiss the appeal. As I briefly explain below, I conclude
    that it is neither necessary nor appropriate to consider the other public
    policy ground dealt with by the application judge.

Issue 2(b): The other public policy ground

[70]

The
    application judge also dismissed the application on the basis that it would be
    contrary to public policy to enforce the Letters of Request in aid of a cause
    of action forbidden in Ontario. As the application judge pointed out, in
Frame v. Smith
, the Supreme Court of Canada refused to
    recognize a cause of action by a parent against a former spouse and others for
    interference with access to their children. The application judge determined
    that the appellant was using Florida law to advance a claim that Ontario law
    does not recognize. Drawing on case law concerning the recognition and
    enforcement of foreign judgments, the application judge concluded that the
    Letters of Request were based on a foreign law that is simply too offensive to
    local notions of what is just and reasonable, so they should not be enforced:
    at para. 132.

[71]

The
    appellant submits that in so finding the application judge misapplied the
    public policy factor applicable to letters of request, which focuses on whether
    the disclosure of the information sought would offend public policy, not on the
    underlying foreign litigation.

[72]

The
    appellant correctly states the governing jurisprudence. In
Presbyterian Church
, at para. 23, this court cited the
    decisions in
Zingre
and
Westinghouse
    Electric
for the principle that the public policy analysis must
    focus on the request, not on the underlying foreign litigation.

[73]

However,
    in the circumstance of this case, it is not necessary to consider the issue of
    whether an Ontario court can refuse to enforce letters of request on the ground
    that the foreign cause of action is not one recognized in Ontario. It is not
    necessary since I have found, at para. 68 above, that the application judge did
    not err in declining to enforce the Letters of Request on the other public
    policy ground  namely, because they would improperly interfere with
    solicitor-client privilege and confidentiality. That is a sufficient basis on
    which to dispose of the appeal.

[74]

It
    would be inappropriate to consider the issue as it has not been properly
    briefed. The application judge did not refer to, nor have the parties drawn our
    attention to, a case where an Ontario court refused to enforce letters of
    request on the ground that the foreign cause of action was not one recognized
    in Ontario. No legal text or journal commentary on the issue was filed on the
    appeal. Given that state of the record, consideration of the issue should await
    a case where it is determinative and has been properly briefed.

VI.     DISPOSITION

[75]

For
    the reasons set out above, I would dismiss the appeal.

[76]

By
    email dated October 30, 2020, the parties informed the court that they had
    reached an agreement on costs.

Released: SEP DEC 22 2020

David
    Brown J.A.

I
    agree. S.E. Pepall J.A.

I
    agree. K. van Rensburg J.A.

APPENDIX
    A

SUBPOENA FOR-PRODUCTION OF DOCUMENTS FROM NON-PARTY THE
    STATE OF FLORIDA

TO:
    Records Custodian

Lorne
    Glass

Glass
    and Associates

[]

YOU ARE
    HEREBY COMMANDED to appear at the Law Office of Gary Joseph, MacDonald &
    Partners, 155 University Ave. Suite 1700, Toronto, ON M5H 3B7, on or before 10
    days from the date of service of this Subpoena, and to have with you at that
    time and place the following documents relating to OLIVIA GLEGG:

1. All retainer agreements, engagement letters, contracts, or
    records of employment between Lorne Glass and/or Lorne Glass and Associates
    (Firm) showing the terms and conditions of your office's consultation and/or
    representation of OLIVIA GLEGG or any person acting on her behalf for all
    matters in which the Firm was retained to provide services to or on behalf of
    OLIVIA GLEGG, with respect to all legal matters including consulting services
    and any initial consultation, from the date of the initial contact through
    August 31, 2017.

2. With respect to the matter(s) referenced in paragraph numbered
    one (1) above, any and all records reflecting time entries, including but not
    limited to daily time records, of any and all attorneys, paralegals and
    assistants working on this matter, together with any and all billing memoranda
    and bills rendered by the Firm on this matter, from the date of the initial
    contact through August 31, 2017.
*** Attorney-Client Privileged/Work
    Product Privileged Information May Be Redacted ***

3. All records, including but not limited to payment records,
    receipts, credit card authorizations, cancelled checks, etc., evidencing
    payments or distributions made by or on behalf of OLIVIA GLEGG toward attorney
    fees (including any consultations), costs or retainers from the date of the
    initial contact through August 31, 2017.

4. All records, including but not limited to payment records,
    receipts, credit card authorizations, cancelled checks, etc., evidencing
    payments or distributions made by or on behalf of OLIVIA GLEGG toward
    professional and/or expert fees and costs rendered by third parties from the
    date of the initial contact through August 31, 2017.
***
    Attorney-Client Privileged/Work Product Privileged Information May Be Redacted
    ***

5. All
    records including names, dates, email addresses, phone numbers and call logs of
    communications with persons other than OLIVIA GLEGG in which you communicated
    in conjunction with your consultation and/or representation of OLIVIA GLEGG.
***Attorney-Client
    Privileged/Work Product Privileged Information May Be Redacted ***

6. All photographs, documents or tangible evidence provided to you
    by any person other than OLIVIA GLEGG in conjunction with your conjunction with
    your consultation and/or representation of OLIVIA GLEGG.
***
    Attorney-Client Privileged/Work Product Privileged Information May Be Redacted
    ***

7. In the event any document is withheld as privileged
    (attorney-client or work product), please provide a list ("privilege
    log") of the documents withheld in compliance with
Fla. R. Civ. P
.
    1.280(b)(5) for subsequent judicial review and state the following information
    with respect to each document withheld:

a.

The date appearing on the document and, if it
    has no date, the date or the approximate date on which it was prepared;

b.

The title, label, code number, or file number of
    the documents;

c. The name and current address of the
    person who signed the document or, if it is not signed, the name and current
    address of the person who prepared the document;

d. The name and current address of the
    person to whom the document was directed and the person or persons to whom any
    copies of the document were directed;

e. A general description of the subject
    matter to which the document relates;

f. The name and current address of the
    person having present possession, custody, or control of the document; and

g. The grounds on which the document is
    being withheld.

These
    items will be inspected and may be copied at that time. You will not be
    required to surrender the original items. You may comply with this subpoena by
    providing legible copies of the items to be produced to the attorney whose name
    appears below, on or before the scheduled date of production. You may condition
    the preparation of the copies upon the payment in advance of the reasonable
    cost of preparation. You may mail or deliver the copies to the attorney whose
    name appears on this subpoena and thereby eliminate your appearance at the time
    and place specified above. You have the right to object to the production
    pursuant to this subpoena at any time before production by giving written
    notice to the attorney whose name appears on this subpoena. This will not be a
    deposition; no testimony will be taken.

If you fail to (a) appear as specified; or (b) furnish the records
    instead of appearing as provided above; or (c) object to this subpoena, you may
    be in contempt of court. You are subpoenaed to appear by the attorney whose
    name appears below, and unless excused from this subpoena by this attorney or
    the court, you shall respond to this subpoena as directed.

[1]

Section
    60 of the
Evidence Act
, R.S.O. 1990, c. E.23
grants Ontario
    courts the discretion to enforce letters of request issued by a foreign court.
    The
Canada Evidence Act
, R.S.C. 1985, c. C-5 contains a similar
    provision, at s. 46.

[2]
Schedule C to the Factum of Lorne Glass, dated May 27, 2020, cogently
    demonstrates that most of the findings of fact made by the application judge
    were based on materials filed by the appellant.

[3]

Consolidated
    Practice Direction for Civil Actions, Applications, Motions and Procedural
    Matters in the Toronto Region
, s. 13;
Ontario Superior Court of Justice
    (Toronto Region) Civil Scheduling Unit Confirmation Form
, January 2020.

[4]
The
    six factors are: (1) the evidence sought is relevant; (2) the evidence sought
    is necessary for trial and will be adduced at trial, if admissible; (3) the
    evidence is not otherwise obtainable; (4) the order sought is not contrary to
    public policy; (5) the documents sought are identified with reasonable
    specificity; and (6) the order sought is not unduly burdensome, having in mind
    what the relevant witnesses would be required to do, and produce, were the
    action to be tried here.

[5]
Another
    example of a court relying upon Canadian blocking legislation or government
    policy is the decision of the Superior Court of Justice in
Morgan,
    Lewis & Bockius LLP v. Gauthier
(2006), 82 O.R. (3d) 189 (S.C.). There,
    the court refused to give full effect to a letter of request from a
    Pennsylvania court in part for reasons of public policy because the production
    sought related to breaches by a Canadian company of American legislation
    prohibiting trade with Cuba. The court noted that Canadian public policy
    opposed the extra-territorial application of the American embargo legislation
    and a Canadian government order prohibited Canadians from complying with the
    United States law: at para. 74. In the result, the parties agreed upon a
    reduced scope of documentary production that satisfied the courts concerns: at
    para. 87.


COURT OF APPEAL FOR ONTARIO

CITATION: Grasshopper Solar Corporation v. Independent
    Electricity System Operator, 2020 ONCA 769

DATE: 20201202

DOCKET: M51845 (C67794 & C67795)

Trotter J.A. (Motion
    Judge)

BETWEEN

Grasshopper Solar Corporation,

GSC Solar Fund I Inc., One Point Twenty One Gigawatts Inc.,

Egerton Solar Power LP, and MPI GM Solar 1 LP

Applicants (Appellants/Moving Parties)

and

Independent Electricity
    System Operator

Respondent (Respondent/Responding Party)

AND BETWEEN

KL Solar Projects LP, Highlands Solar Projects LP,

Madawaska Solar Projects LP, McNab Solar Projects LP,

PB Solar Projects LP, Ramara Solar Projects LP,

Sudbury Community Solar Projects LP and

Sustainable Ottawa Projects LP

Applicants (Appellants/Moving Parties)

and

Independent Electricity
    System Operator

Respondent (Respondent/Responding Party)

Sarit E. Batner and Brandon Kain,
    for the moving parties

Alan H. Mark and Melanie Ouanounou, for the responding
    party

Heard: November 27, 2020 by videoconference

REASONS FOR DECISION

[1]

This is a motion to stay two orders of this court pending an application
    for leave to appeal to the Supreme Court of Canada and, if leave is granted,
    pending the final disposition of that appeal. For the reasons that follow, I
    would grant a stay
of this courts orders pending the
    applications for leave to appeal.

Background

[2]

This case involves the decision of the respondent, the Independent
    Electricity System Operator (IESO), to terminate 36 standard-form contracts
    with the applicants, renewable energy companies who construct and operate solar
    power facilities. Under these contracts, called Feed-in Tariff Contracts (FIT
    Contracts), the applicants were to construct solar facilities and provide
    clean energy to Ontarios electricity grid for a typical term of 20 years, at
    enhanced rates (i.e., above market rates). The contracts required the
    applicants to achieve commercial operation of their facilities by a certain
    date  the Milestone Date for Commercial Operation (MDCO)  failing which,
    the IESO may be able to terminate the contracts without paying damages. The
    applicants failed to meet the applicable MDCO. The respondent eventually gave
    notice that it would terminate their contracts. The termination of these
    agreements would mean that any energy that the applicants supply to the IESO
    will be at the lower market rates.

[3]

The applicants applied for declarations that their failure to achieve
    commercial operation by the MDCO did not constitute a default of the contracts.
    Hainey J. of the Superior Court of Justice dismissed their applications:
Grasshopper
    Solar Corporation v. Independent Electricity System Operator
, 2019 ONSC
    6397; and
KL Solar Projects LP v. Independent Electricity System Operator
,
    2019 ONSC 6501.

[4]

A panel of this court dismissed the applicants appeal:
Grasshopper
    Solar Corporation v. Independent Electricity System Operator
, 2020 ONCA
    499. Writing for the court, Huscroft J.A. confirmed the application judges
    conclusion that the respondent was entitled to terminate the contracts: see
    paras. 36-44. Further, at paras. 53-78, he rejected the applicants submission
    that the respondent was estopped from terminating the contracts, either on the
    basis of estoppel by convention or promissory estoppel.

[5]

The applicants seek leave to appeal that decision to the Supreme Court
    of Canada on various strands of contractual interpretation, using
Sattva
    Capital Corp. v. Creston Moly Corp
.
, 2014 SCC 53, [2014] 2 S.C.R.
    663 as their starting point. In their Memoranda of Argument, all applicants
    raise the following questions:

(1)

Does
    reading a contract as a whole require giving effect to all of its terms?

(2)

How
    do surrounding circumstances that are not specific to the parties affect the
    interpretation of standard form contracts?

(3)

Can
    courts imply terms to cure commercially unreasonable interpretations of
    contracts?

The KL Solar applicants also seek leave to appeal on
    further issues concerning estoppel and waiver.

[6]

Under the Rules of the Supreme Court of Canada, the respondents
    materials are not yet due.

[7]

In the course of the litigation leading up to the determination of the
    appeal in this court, the respondents agreed not to terminate the contracts.
    They have continued to make FIT payments. This arrangement is reflected in a
    Forbearance Agreement between the parties, entered into in July of 2019. Hainey
    J. incorporated the terms agreed upon into two interlocutory orders. The issue
    was also addressed in a Security Agreement entered into on April 1, 2020.

[8]

The applicants take the position that, in both instances, the parties
    contemplated that these arrangements would remain in place until matters are
    finally determined in the Supreme Court of Canada. They submit that the
    respondents should be held to their word and that this application should be
    treated as an extension of a pre-existing stay. The respondent contends that the
    previous agreements were intended to expire upon the conclusion of proceedings
    in this court.

[9]

I need not resolve this issue. These motions can be determined through
    the application of principles that govern the availability of stays pending
    appeal.

The Test for Granting a Stay

[10]

The
    applicants apply under s. 65.1 of the
Supreme Court Act
, R.S.C. 1985,
    c. S-26. That section empowers the Supreme Court, the court of appeal, or a
    judge of either court, to stay proceedings with respect to the judgment from which
    leave to appeal is sought on terms deemed appropriate. The power is broad. In
RJR-MacDonald Inc. v. Canada (Attorney General)
, [1994] 1 S.C.R. 311,
    Sopinka and Cory JJ. held, at p. 329:

We are of the view that the Court is empowered, pursuant to
    both
s. 65.1
and
r. 27
, not only to
    grant a stay of execution and of proceedings in the traditional sense, but also
    to make any order that preserves matters between the parties in a state that
    will prevent prejudice as far as possible pending resolution by the Court of
    the controversy, so as to enable the Court to render a meaningful and effective
    judgment.

[11]

In
Livent Inc. v. Deloitte & Touche
, 2016 ONCA 395, 131 O.R. (3d)
    784, at paras. 4-5, Strathy C.J.O. set out the test for a stay of proceedings
    pending an application for leave to the Supreme Court. In deciding this kind of
    motion, the court must consider the following factors: (1) whether there is a
    serious question to be determined on the proposed appeal; (2) whether the
    moving party will suffer irreparable harm if the stay is not granted; and (3)
    whether the balance of convenience favours a stay. These factors are not to be
    treated as silos; strength on one factor may compensate for weakness on
    another:
Livent Inc
.,
at

para. 5. The overriding
    question is whether the moving party has shown that it is in the interests of
    justice to grant a stay:
BTR Global Opportunity Trading Limited v. RBC
    Dexia Investor Services Trust
, 2011 ONCA 620, 283 O.A.C. 321, at para. 16.
    See also
Donovan v. Sherman Estate
, 2019 ONCA 465, at para. 8.

[12]

The
    respondent resists this motion on all three factors.

Application

[13]

Applying these factors, the interests
    of justice warrant granting a stay of this courts orders pending the
    applications for leave to appeal.

Serious Question to be Determined

[14]

Deciding whether there is a serious
    issue to be determined requires a preliminary assessment of the proposed merits
    of the appeal, as well as the proposed merits of the application for leave to
    appeal. The threshold at this stage is low:
Livent Inc
.
, at paras. 7-8;
Donovan
, at para. 9.

[15]

The applicants were unsuccessful before
    Hainey J., and a panel of this court unanimously dismissed the applicants
    appeals. The applicants submit that the decisions of both courts are wrong;
    whereas, the respondents claim that both decisions are undoubtedly correct,
    based in part on the judicial consensus to date.

[16]

I do not see it as my role to pass
    judgment on the correctness of my colleagues decision. Although I was greatly
    assisted by the submissions of counsel on this motion, I did not share in the
    benefit of the arguments on appeal, or the collegial deliberative process that
    culminated in the reasons of Huscroft J.A.

[17]

My focus is on whether there is
    arguable merit in the application for leave to appeal to the Supreme Court of
    Canada. While this task is somewhat different, it is no easier. It is
    challenging to predict how another court will react to the presentation of
    legal issues. This is especially the case in the broader framework set out
    under s. 40(1) of the
Supreme Court Act
,
which requires
    the proposed appeal to raise an issue of public or national importance. And as
    my colleague van Rensburg J.A. observed in
Donovan
, at para. 13, leave to appeal would appear to be granted
    sparingly in civil matters.

[18]

Nonetheless, the applicants have
    carefully developed a number of issues, as set out in para. 5, above. During
    oral argument on the motion, counsel for the respondent submitted that the
    applicants do not assert errors of law; instead, they raise questions about the
    application of settled law to the facts of this case. The respondent also
    submits that the applicants do not raise issues of national or public
    importance.

[19]

I have concluded that the applicants
    have met the low threshold required to satisfy the first part of the test.
    The applicants have raised issues that could go beyond the simple application
    of a known test to given facts and would transcend the facts of this particular
    case:
Donovan
, at para. 16. There
    may be merit in the respondents assertion that some of the issues pursued by
    the applicants do not appear to raise questions of law. But that will be for
    the Supreme Court of Canada to decide. And although this is a civil case, the
    foundation of this contractual dispute  between an energy regulator and clean
    energy suppliers  is atypical and may engage public interests.

[20]

In my view, the applicants have
    satisfied the low threshold required at this stage.

Irreparable Harm

[21]

The applicants submit that, if the
    orders of this court are not stayed, they will suffer irreparable prejudice
    that cannot be compensated with damages. If this court does not grant a stay
    and the respondent is entitled to terminate the FIT Contracts, the applicants
    will be driven out of business, causing significant irreparable harm to third
    parties, since as many as 63 direct employees and hundreds of other individuals
    employed by contractors, subcontractors, and suppliers in Ontario will lose
    their livelihoods.

[22]

The respondent submits that any harm
    the applicants might suffer from being deprived of FIT payments during
    proceedings in the Supreme Court can be remediated by reimbursing withheld FIT
    payments if the applicants are ultimately successful in the Supreme Court.

[23]

To a large degree, this issue turns on
    the applicants credit arrangements. Both parties relied on extensive evidence
    concerning the corporate structure of the applicants, and their complex credit
    arrangements. Their arguments involved competing predictions of how the
    applicants main creditor will respond if FIT payments are terminated and the
    applicants are unable to service their debt. The applicants submit that their
    creditor will call their loan, which will trigger financial turmoil, resulting
    in the human consequences referred to in paragraph 21, above. The respondent
    submits that it would make no commercial sense for the applicants creditor to
    behave in such a fashion while the leave application is outstanding; the
    creditors only hope of recovering the considerable funds it has already
    advanced is dependent upon the applicants success in the Supreme Court of
    Canada.

[24]

Based on the evidence and submissions
    before me, I am satisfied that a failure to preserve the
status quo
could well result in the consequences the applicants
    envisage. Whether or not the subsequent payment of withheld FIT payments could
    repair the purely commercial repercussions the applicants fear, I am satisfied
    that the human cost would be irreparable.

[25]

The applicants have demonstrated
    irreparable harm.

The Balance of Convenience

[26]

In addressing this factor in
Livent
    Inc
.
,
    Strathy C.J.O. said, at para. 12: The balance of convenience is just that  a
    balancing of which party will suffer the greater harm from the stay being
    granted or refused.

[27]

In the previous section, I have
    outlined my findings about the impact on the applicants if the respondent were
    permitted to immediately enforce its contractual rights and terminate FIT
    payments. On the other side of the equation, the respondent submits that a stay
    of proceedings order that requires the respondent to continue making FIT
    payments risks exposing Ontario ratepayers/taxpayers to irremediable economic
    consequences.  The concern is that the respondent will be unable to recover the
    FIT payments it advances while the case is in the Supreme Court of Canada. The
    respondent asserts that the security it currently holds in the applicants
    assets is insufficient to cover this exposure. The applicants submit that their
    pledge of security is in the range of $13 million and adequately protects the respondents
    interests; the respondent submits that the pledged assets (i.e., solar power
    equipment) are worth far less. If a stay is granted, the respondent requests
    that the applicants be required to post additional security.

[28]

I accept the respondents submission
    that the evidence supporting the value of the applicants assets is rather
    thin, based on an undated internal memo on Grasshopper stationary, which is
    short on detail. On the other hand, during his cross-examination, the
    respondents affiant acknowledged that the applicants had greater expertise
    when it came to selling this specialized equipment.

[29]

On balance, I am satisfied that the
    security held by the respondent is sufficient to protect it against the risk of
    non-recovery of continued FIT payments, at least in the short run.

[30]

The balance of convenience favours the
    applicants.

Conclusion

[31]

Considering all three factors discussed
    above, I am satisfied that the interests of justice require that the orders of
    this court be stayed pending the applications for leave to appeal. However, I
    am not prepared to order a stay that potentially extends further into the
    future. That is, the stay extends to the point in time when the Supreme Court
    of Canada determines the applications for leave to appeal. If it dismisses the
    applications, that will end the matter. If the Supreme Court allows the
    applications, the applicants may apply for further orders, if so advised, in
    that Court.

Disposition

[32]

I allow the motion and order a stay of
    this courts orders until the applications for leave to appeal have been
    determined. For clarity, the contracts in dispute will be performed by both
    parties in accordance with their terms, including the continuation of FIT
    payments. In other words, and in the spirit of
RJR-MacDonald
, the
status quo
is preserved for the time-being.

[33]

At the conclusion of the hearing,
    counsel advised that, in all likelihood, they would be able to agree on the
    costs of this motion. If they are unable to do so, they may make submissions in
    writing. The applicants shall file written submissions of no more than three
    pages in length within 10 days of the release of these reasons. The respondent
    will have 10 days from the receipt of the applicants submissions to file its
    submissions of similar length. No reply is permitted. Both parties shall submit
    a Bill of Costs.

Gary Trotter
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Hoang v. Mann Engineering Ltd.,
    2020 ONCA 808

DATE: 20201216

DOCKET: C68186

Doherty, Lauwers and Miller
    JJ.A.

BETWEEN

K. Matthew Hoang

Plaintiff (Appellant)

and

Mann Engineering Ltd., Aris
    Building Technologies, Cartwright Management, Mann Enterprises, Wu Ventures,
    Hay Solar Ltd., and Gigajoule Research and Development Ltd. (carrying on
    business as the Mann Group)

Defendants (Respondents)

K. Matthew Hoang, appearing in person

Ted Flett and Daniel Hassell, for the
    respondents

Heard: December 3, 2020 by
    video conference

On appeal from the order of Justice B.
    Glustein of the Superior Court of Justice, dated November 4, 2019, reported at
Hoang
    v. Mann Engineering Ltd.
, 2019 ONSC 6383.

By the Court:

I

[1]

The appellant sued the respondents (Mann
    Engineering) in negligence. Mann Engineering moved for summary judgment. The appellant
    brought a cross-motion for summary judgment. The motion judge allowed the
    motion and dismissed the appellants action. He dismissed the cross-motion.

[2]

The appellant appeals from that order asking
    that the judgment dismissing his claim be set aside and that he be granted
    summary judgment. The appellant also seeks leave to appeal the costs order made
    by the motion judge. We dismiss the appeal, grant leave to appeal the costs
    order and dismiss that appeal.

II

[3]

The appellant used to work for Mann Engineering.
    He sued Mann Engineering for wrongful dismissal in 2011. The claim was
    dismissed in 2014 and Mann Engineering was awarded costs in the amount of
    $76,866.19. The long chronology of the appellants attempts to appeal from the judgment
    dismissing his action is summarized in the reasons of the motion judge:
Hoang
    v. Mann Engineering Ltd.
, at para. 11.

[4]

Mann Engineering commenced garnishment
    proceedings in March 2016. They issued a requisition of garnishment to the
    appellants employer pursuant to r. 60.08(4) and sought to examine the
    appellant in aid of execution. The garnishment proceedings stalled as the
    appellant made various efforts to appeal the dismissal of his action. Those
    efforts came to their ultimate end in January 2017.

[5]

In December 2016, Mann Engineering brought a
    motion in the garnishment proceedings seeking three things:

·

an order requiring the appellants employer (the
    employer) to garnish his wages (the garnishment order);

·

an order requiring the employer to pay in full
    the appellants debt pursuant to r. 60.08(17) (the enforcement order); and

·

an order requiring the appellant to attend for
    examination in aid of execution.

[6]

Mann Engineering had not previously sought an
    enforcement order against the employer. An enforcement order could only be made
    if the employer had not served and filed its garnishee statement. Mann
    Engineering had been served with a garnishee statement, but the employer had
    apparently not filed that statement with the court.

[7]

To this stage in the garnishee proceedings, the
    employer had not been separately represented. The appellant appeared and spoke for
    himself and his employer. Mann Engineerings request for an enforcement order
    against the employer potentially, significantly altered the focus of those
    proceedings. Under the enforcement order, the employer could be required to pay
    the entire debt.

[8]

Mann Engineerings motion was heard in late
    December 2016. Once again, the employer was not separately represented. The
    appellant appeared and made submissions referable to both his and the
    employers position. In her brief endorsement, dated January 11, 2017, the
    master made no reference to any enforcement order against the employer. She
    indicated the employer was prepared to garnish the appellants wages and that,
    as the appeal process was now concluded, the garnishment could proceed. In the
    endorsement, the master indicated order to go as asked.

[9]

Counsel for Mann Engineering prepared a draft
    order. At counsels request, the master dispensed with the requirement that the
    appellant approve the content of the order. The order issued as drafted by counsel
    for Mann Engineering. It included an enforcement order requiring the employer
    to pay to Mann Engineering the entire amount of the judgment debt owed by the
    appellant.

[10]

The motion judge, after reviewing the transcripts
    of the proceedings before the master, and the terms of the endorsement, was satisfied
    the order should not have contained a term requiring the employer to pay the
    debt (the enforcement order):
Hoang v. Mann Engineering Ltd.
, at para.
    41. We see no reason to interfere with that finding. Not only was the
    endorsement silent about the enforcement order, counsel for Mann Engineering, during
    his submissions before the master on the motion, appeared to abandon the request
    for an enforcement order, focussing instead on the garnishee order. In his
    submissions, counsel argued the garnishee order would work no financial
    hardship on the employer.

[11]

The employer became aware of the enforcement
    order in May 2017, when Mann Engineering brought a motion to vary the
    enforcement order to add other related corporate entities. On the return of
    that motion, Josef Ger, the president of the employer, filed an affidavit
    indicating the appellant had assumed responsibility for the garnishment
    proceedings. Mr. Ger alleged he had been misled by the appellant on many
    matters relating to the garnishment and certain information had been kept from
    him by the appellant. There was no evidence before the master challenging Mr.
    Gers assertions.

[12]

Mr. Ger indicated the employer was prepared to
    comply with the garnishment order, but asked the master to set aside the
    enforcement order as a nullity. The master accepted the position put forward by
    the employer and set aside the enforcement order on the basis of mistake. She
    ordered the employer to garnish the appellants wages and she ordered costs in
    favour of Mann Engineering in the amount of $6,000, payable by the appellant
    and the employer on a joint and several basis.

[13]

In her endorsement setting aside her previous
    order, the master was not critical of Mann Engineering for taking out the
    enforcement order, although when considering the quantum of costs, she did
    refer to the defendants [Mann Engineering] own errors. It is crystal clear the
    master set aside the enforcement order because she accepted Mr. Gers assertions
    that the employer had been kept in the dark and misled by the appellant.

[14]

The masters endorsement setting aside the
    enforcement order was made on September 12, 2017. The employer terminated the
    appellants employment about a month later.

[15]

The appellant did not sue his employer for
    wrongful dismissal, but instead sued Mann Engineering in negligence for damages
    arising out of his dismissal.

[16]

In his negligence claim, the appellant alleged,
    but for the improper obtaining of the enforcement order by Mann Engineering,
    his employer would not have come to the opinion the appellant had misled and
    lied to the employer throughout the garnishment proceedings and would not have
    fired him. Consequently, according to the appellant, Mann Engineering caused
    his dismissal.

[17]

The appellant also alleged, that since his job
    was the source of his potential payment of the debt he owed to Mann Engineering,
    his employment was an asset to Mann Engineering. This, said the appellant, established
    the requisite relationship between the appellant and Mann Engineering necessary
    to impose a duty of care in the garnishment proceedings on Mann Engineering in
    respect of the appellants ongoing employment. Finally, the appellant alleged his
    termination was a reasonably foreseeable consequence of Mann Engineerings
    obtaining of the enforcement order against the employer.

III

[18]

Before addressing the arguments, it is important
    that to emphasize the appellants statement of claim advanced only a negligence
    claim. The motion judge treated the appellants claim as if it included a claim
    based on the tort of abuse of process. The motion judge found no triable issue
    in respect of either the negligence claim or the abuse of process claim.

[19]

On appeal, the appellant stressed that he never
    pleaded the tort of abuse of process, did not intend to do so, and was not
    relying on any such claim. The appellant acknowledged he advanced only a negligence
    claim.

[20]

In granting summary judgment on the negligence
    claim, the motion judge said, at para. 77:

I accept the submissions of the defendants
    that the duty of care upon which Hoang relies is not established on the
    evidence, and that even if a duty of care should be found to exist, the
    plaintiff has failed to establish causation between the breach and the loss of
    Hoangs employment with RLCC.

[21]

We are satisfied the appellants negligence
    action was properly dismissed on the basis the evidence did not give rise to a
    triable issue on the question of whether Mann Engineering, in the course of pursuing
    the garnishment proceedings, owed a duty of care to the appellant. Before we
    turn to that issue, we will briefly address three other arguments advanced by
    the appellant in his factum and in oral argument.

IV

[22]

The appellant contends the motion judge misapprehended
    the evidence when the motion judge said, at para. 85:

Consequently, any error in the Enforcement Order,
by granting relief that the defendants abandoned in the
    course of the hearing
, cannot be seen as an intentional, overt act for
    an improper purpose. The enforcement term was consistent with the notice of
    motion, consistent with the submissions that no garnishee statement was filed
    by RLC, and consistent with Rule 60.08(17). [Emphasis added.]

[23]

The appellant submits Mann Engineering did not
    abandon the enforcement order, but actively pursued it, going so far as to obtain
    a writ of seizure against the employer.

[24]

The appellant misunderstands the reference in
    para. 85 of the motion judges reasons. The motion judge referred to Mann
    Engineering abandoning the claim for an enforcement order in the course of the
    hearing. The motion judge was referring to the submissions made by counsel for
    Mann Engineering, in which he appeared to abandon any request for an
    enforcement order, focussing instead on the garnishment order and the order
    requiring the appellant to attend for examination. We do not read the comment
    by the motion judge, at para. 85, as speaking to Mann Engineerings actions after
    the enforcement order was obtained.

[25]

In addition, even if there is a misapprehension
    of the evidence in para. 85, that misapprehension does not assist the
    appellant. At para. 85, the motion judge is analyzing the abuse of process
    claim which he took as implicit in the appellants statement of claim. In
    particular, the motion judge was addressing the requirement of an overt act
    designed to further some improper purpose. The appellant has made it clear he
    does not advance a claim based on the tort of abuse of process. Any
    misapprehension of the evidence by the motion judge in the context of his abuse
    of process analysis has no effect on the motion judges dismissal of the
    negligence claim.

[26]

The appellant next argues the motion judge erred
    in speculating as to the cause of the appellants termination. He contends
    there is no evidence to support the motion judges finding the appellant was
    fired for surreptitious conduct. The appellant further contends Mann
    Engineering never made that assertion, indicating instead it had no evidence as
    to the cause of the appellants termination.

[27]

Mann Engineerings statement of defence puts in
    issue the cause of the appellants termination. The statement of defence alleges
    the appellants actions caused his own termination. There was evidence before
    the motion judge from which it could be inferred the employers belief the
    appellant had acted dishonestly throughout the garnishment proceedings was the
    reason for his dismissal.

[28]

Judges on summary judgment motions are permitted
    to draw reasonable inferences: r. 20.04(2.1). Not all reasonable inferences are,
    however, appropriately drawn in any given summary judgment motion. It depends
    on the record and the issues. As we are disposing of the appeal on the duty of
    care issue, we need not decide whether an inference as to the cause of the
    appellants dismissal by his employer was appropriately made on this evidentiary
    record.

[29]

In his third argument, the appellant submits the
    motion judge wrongly indicated the tort of abuse of process applied only if the
    appellant showed Mann Engineering owed a duty of care to the appellant.

[30]

The tort of abuse of process is premised on an
    improper use of the civil justice process. The concept of a duty of care has no
    role to play in the abuse of process analysis. Although the motion judge accurately
    identified the elements of the tort, at para. 72, later in his reasons he
    wrongly indicated a duty of care was also an element of an abuse of process
    claim (e.g. see para. 81).

[31]

Assuming the motion judge erred in law in
    describing the elements of the tort of abuse of process, that error cannot advance
    the appellants appeal. As indicated above, the appellant does not advance a claim
    based on the tort of abuse of process. Any misstatement of the elements of that
    tort by the motion judge could not prejudice the appellant.

V

[32]

We now come to the duty of care issue. To succeed
    on the negligence claim, the appellant had to show Mann Engineering owed him a
    duty of care while pursuing their garnishment remedies. For the purpose of determining
    whether the existence of a duty of care raised a triable issue on this record,
    we will assume:

·

Mann Engineering should not have included an
    enforcement order in the draft order produced to, and eventually signed by, the
    master in January 2017; and

·

the enforcement order was at least one of the
    reasons the employer fired the appellant.

[33]

The appellant submits, because his job was an
    asset to Mann Engineering, in that it was a potential source of the payment of
    the appellants debt, Mann Engineering owed the appellant a duty of care in
    respect of that asset. In effect, the appellant contends, a judgment creditor,
    who is seeking to realize on a judgment through garnishment proceedings, owes a
    duty of care to the debtor to take all reasonable steps to avoid causing harm
    to the debtors ongoing employment. The appellant acknowledges the duty of care
    he describes is an entirely novel one. Neither the specific duty, nor any
    analogous one has ever been recognized in the Canadian law of negligence.

[34]

When a plaintiff advances a negligence claim
    based on a novel duty of care, the courts determine whether that duty exists using
    a two-step process. The first step looks to the nature of the relationship
    between the plaintiff and the defendant and the foreseeability of the harm
    caused. These two factors, both of which address proximity, taken together
    determine whether a
prima facie
duty of care is established:
168872
    Ont. Inc. v. Maple Leaf Foods Inc.
, 2020 SCC 36, at paras. 30-31;
Cooper
    v. Hobart
, 2001 SCC 79, at paras. 22, 30-32.

[35]

At the second step, the court looks to residual policy
    considerations existing outside of the relationship between the defendant and plaintiff,
    which warrant negativing the
prima facie
duty of care established at
    the first step:
Cooper v. Hobart
, at paras. 37-39.

[36]

We are satisfied there is no
prima facie
duty of care. The evidence does not establish the requisite proximity between
    the appellant and Mann Engineering. There is no relationship between them other
    than the relationship of a judgment creditor using the garnishment proceeding
    in an effort to realize on the debt owed by a judgment debtor. That
    relationship has played out in the context of ongoing litigation initiated by
    Mann Engineering in an effort to recover the debt owed to it by the appellant.
    The adversarial relationship inherent in the litigation process is antithetical
    to the kind of relationship that gives rise to a duty on one party to take
    reasonable care not to interfere with the legitimate interests of the other
    party. There is nothing in the relationship that could justify placing an
    obligation on Mann Engineering to take reasonable steps to protect the
    appellants ongoing employment from any possible negative consequences flowing
    from Mann Engineerings conduct of the garnishment proceedings.

[37]

The appellants description of his ongoing employment
    as an asset to which Mann Engineering looked for recovery of its debt does
    not advance the proximity analysis. However one chooses to describe the
    appellants employment, the nature of the relationship engaged on this evidence
    remains exactly the same. Mann Engineering, the judgment creditor, is trying to
    collect its debt from the appellant, the judgment debtor, through garnishment
    proceedings. Nor does the fact Mann Engineering improperly obtained an
    enforcement order against the employer alter the nature of the relationship
    between Mann Engineering and the appellant. Mann Engineerings misstep in the
    course of the garnishment proceedings cannot create a duty of care owed to the
    appellant. Mann Engineerings error would be significant in determining whether
    Mann Engineering fell below the standard of care, if in fact a duty of care had
    existed.

[38]

While we are satisfied the nature of the
    relationship between Mann Engineering and the appellant in the context of the garnishment
    proceedings precludes the existence of any duty of care, we also see no basis
    in the evidence for a finding the type of harm allegedly caused to the
    appellant was reasonably foreseeable to someone in the position of Mann
    Engineering:
Rankin v. J.J.
, 2018 SCC 19, at paras. 24, 26, 53. On the
    evidence, there was no basis upon which Mann Engineering knew, or ought to have
    known, its actions would cause the employer to believe the appellant had misled
    the employer throughout the garnishment proceedings. Without that knowledge, it
    was not reasonably foreseeable the employer would fire the appellant after Mann
    Engineering obtained the enforcement order. Consequently, the kind of damage
    alleged by the appellant was not a reasonably foreseeable consequence of
    obtaining the enforcement order.

[39]

We add one additional comment. Although we do
    not reach the second step of the duty of care analysis, policy considerations
    point strongly away from recognizing the duty of care advanced by the
    appellant. Access to the civil courts to assert claims and enforce judgments is
    fundamental to the operation of our justice system. Potential liability in
    negligence, based on a duty of care owed by a plaintiff to a defendant, must
    surely discourage plaintiffs from using the court process to advance claims and
    enforce judgments. Tort law, and specifically the tort of abuse of process,
    protects against the improper use of the civil justice process. Policy considerations
    do not favour extending that protection to negligence-based claims.

[40]

We hold the motion judge correctly determined
    there was no triable issue on the question of whether Mann Engineering owed a
    duty of care to the appellant in the circumstances revealed by the evidence.
    The action was properly dismissed.

[41]

The appeal is dismissed.

VI

[42]

The appellant also seeks leave to appeal the
    costs order made by the motion judge. He relied on his written submissions. We
    have considered those arguments. None warrant intervention by this court. Leave
    to appeal costs is granted, but the appeal is dismissed.

VII

[43]

Mann Engineering shall file submissions as
    to costs on the appeal within 10 days of the release of these reasons. The
    submissions shall not exceed 5 pages. The appellant shall file his submissions
    within 10 days of receipt of the respondents submissions. The appellants
    submissions shall not exceed 5 pages.

Released:
DD
DEC 16 2020

Doherty J.A.

P. Lauwers J.A.

B.W. Miller J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Jog v. Bank of Montreal, 2020 ONCA
    781

DATE: 20201208

DOCKET: C67578

Feldman, Simmons and Harvison
    Young JJ.A.

BETWEEN

Chandrahas Jog

Plaintiff (Appellant)

and

Bank of Montreal

Defendant (Respondent)

Chandrahas Jog, acting in person

Kate McNeill-Keller and Justine
    Lindner, for the respondent

Heard: November 4, 2020 by video conference

On appeal from the order of Justice Deena F. Baltman of the Superior
    Court of Justice, dated October 16, 2019.

COSTS
    ENDORSEMENT

[1]

Costs of the appeal to the appellant fixed in
    the amount of $3,500 inclusive of disbursements and HST.

K.
    Feldman J.A.

Janet
    Simmons J.A.

A.
    Harvison Young J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Kawartha Capital Corp. v. 1723766 Ontario Limited,
    2020 ONCA 763

DATE: 20201202

DOCKET: C68063

MacPherson, Zarnett and Jamal JJ.A.

BETWEEN

Kawartha Capital Corp.

Plaintiff (Respondent)

and

1723766 Ontario Limited and Maryam Sadrieh

Defendants (Appellants)

Nancy J. Tourgis and Rajiv Joshi, for the appellants

J. Christopher Russell, for the respondent

Heard: November 23, 2020 by videoconference

On appeal from the
    judgment of Justice C.M. Smith of the Superior Court of Justice dated January
    23, 2020.

REASONS FOR DECISION

[1]

The appellants appeal from the summary judgment granted by the motion
    judge, ordering them to pay the sum of $185,999.32 and interest thereon to the
    respondent, and dismissing their counterclaim.

[2]

The corporate appellant, 1723766 Ontario Limited (172), was found
    liable because the sum claimed from it was an amount it agreed to pay to the
    respondent, Kawartha Capital Corp. (Kawartha), under Minutes of Settlement
    (the Minutes) dated September 19, 2016. The personal appellant, Maryam
    Sadrieh (Ms. Sadrieh), was held liable as she guaranteed the payment that 172
    was obligated to make by a written guarantee provided for by the Minutes. The
    counterclaim was dismissed because its subject matter was released in a mutual release
    provided for by the Minutes.

[3]

The appellants argue that the motion judge erred in finding that there
    was no genuine issue requiring a trial as to whether the Minutes (including the
    release and guarantee they contemplated) were unenforceable on the grounds of
    economic duress.

[4]

172 retained Kawartha in 2015 to perform construction work on a property
    owned by the appellants in Port Hope. By August 2016, disputes had arisen.
    Outstanding invoices dated April 29 and May 31, 2016, issued by Kawartha, were
    unpaid. Kawartha had been provided with cheques, post-dated to August 15, 2016,
    to cover those invoices but was advised on that date by the appellants that the
    cheques could not be honoured. Kawartha registered a construction lien on
    August 18, 2016. 172 took the position that Kawarthas delays in completing the
    work had caused it losses, a claim Kawartha disputed. 172 was attempting to
    refinance by placing a new mortgage on the property, but the construction lien
    prevented that from occurring.

[5]

Negotiations took place to resolve those disputes. The parties were represented
    by counsel in the negotiations. The result was the Minutes, executed on
    September 19, 2016.

[6]

Under the Minutes, and the guarantee and release it provided for,
    172 agreed to pay Kawartha an initial payment of $400,000 by September 23, 2016,
    and a second payment of $162,832.33 by March 12, 2017. Ms. Sadrieh personally guaranteed
    payment of the second payment. Kawartha agreed to discharge the construction lien
    upon specified arrangements being in place for the $400,000 initial payment,
    and receipt by Kawarthas counsel of the executed documents. The parties were
    to cooperate with respect to finishing the construction work. The parties
    released each other from any claim

by reason of any matter or thing existing as of the date
    hereof, whether known or unknown, with respect to the construction services and
    materials provided by
Kawartha as of the date hereof. The only exception to
    the release was for Kawarthas ordinary warranty obligations with respect to
    the quality of its workmanship and materials.

[7]

The parties subsequently agreed to amendments, extending the date for
    the initial payment to September 29, 2016, and increasing the amount of the
    second payment to $185,999.32.

[8]

The initial payment due under the Minutes was made on September 29, and
    the construction lien was discharged the same day. The second payment was not
    made.

[9]

On October 16, 2017, Kawartha commenced this action to recover the
    second payment. The appellants defended, alleging for the first time that
    economic duress made the Minutes, and the guarantee and release they provided
    for, unenforceable. The appellants also alleged that they had been damaged by Kawarthas
    delays in performing the construction work, and claimed an equitable set-off
    for those damages. They also counterclaimed for those damages.

[10]

We
    see no error in the motion judges finding that there was no genuine issue for
    trial raised by the appellants claim of economic duress.

[11]

For
    a party to establish economic duress, it must show two things: first, that it
    was subjected to pressure applied to such an extent that there was no choice
    but to submit, and second, that the pressure applied was illegitimate. On the
    first prong of the test, the court considers four factors:

(a) Did the party protest at the time the contract was entered
    into?

(b) Was there an effective
    alternative course open to the party alleging coercion?

(c) Did the party receive
    independent legal advice?

(d) After entering into the
    contract, did the party take steps to avoid it?

If the party alleging duress satisfies those four
    factors, it must go on to satisfy the second prong, by showing that the
    pressure exerted was illegitimate:
Techform

Products Ltd. v. Wolda

(2001), 56
    O.R. (3d) 1 (C.A.), at paras. 31-34, leave to appeal refused,
[2001] S.C.C.A. No. 603.

[12]

The
    motion judge found that the appellants satisfied none of the four factors
    relevant to the first prong of the test. These findings have a substantial
    factual component and are entitled to deference on appeal.

[13]

The motion
    judges finding that there was no protest of any kind by the appellants when
    they signed the Minutes cannot be challenged, as the appellants seek to do, by
    reference to the fact that the appellants had, in August, advised Kawartha of
    their position that Kawarthas delays had caused them damages. That position
    was one of the issues referred to in, and resolved by, the Minutes, signed on
    September 19. There was no evidence that the appellants, or their counsel,
    protested that they were being compelled to enter into the Minutes. Indeed, the
    motion judge found that the Minutes were largely based on a proposal that was
    made on behalf of the appellants on August 29.

[14]

The
    appellants submit that Ms. Sadrieh gave evidence that she felt she was in a
    vulnerable position and had no realistic alternative but to enter into the
    Minutes. They argue that given this evidence, and without other evidence, the
    motion judge was not entitled to find that the appellants were not without alternatives
    in the face of the construction lien. We disagree. The motion judge was
    entitled to consider the legal remedies potentially available to an owner when
    a construction lien is registered, including posting a bond to vacate a lien,
    or suing for damages for a liens wrongful registration. In assessing whether
    the appellants had satisfied their burden of showing an absence of an
    effective alternative course, the motion judge was entitled to take into
    account that the appellants led no evidence to suggest that they considered or
    pursued any of these alternatives.

[15]

The
    motion judges findings about the factors of independent legal advice and
    prompt steps to avoid the agreement also disclose no error. The evidence was
    undisputed that the appellants were represented by counsel and thus had
    independent legal advice up to and through the execution of the Minutes. Nor
    did the evidence disclose any timely steps by the appellants to avoid the
    Minutes after they were signed. The appellants not only made the initial payment
    under the Minutes, and received the benefit of the discharge of the construction
    lien, but even after they defaulted on making the second payment when it came
    due in March 2017, they requested more time to pay. They took no steps to
    challenge the Minutes until, having been sued for the second payment, they
    delivered a defence asserting economic duress on January 15, 2018, well over a
    year after the Minutes were signed and significant performance under them had
    taken place.

[16]

There
    was, accordingly, no error in the motion judges finding that the appellants
    had raised no genuine issue requiring a trial regarding the enforceability of
    the Minutes or the guarantee and release they provided for. The appellants
    failed to raise such an issue regarding the first prong of the test for
    economic duress. The appellants argue that the motion judge erred in not going
    on to specifically address the second prong of the test, namely whether the
    pressure was illegitimate, and in failing to make findings about whether the
    appellants had had a good claim for damages for delay, which would have shed
    light on whether the registration of the construction lien was imposing
    illegitimate pressure on them. We disagree. A person invoking economic duress
    must satisfy both prongs of the test. Having failed to show a genuine issue
    requiring a trial on the first prong, a specific ruling on the second prong
    could not change the outcome.

[17]

The
    dismissal of the counterclaim was entailed by the release contemplated by the
    Minutes. The motion judge found the counterclaim raised matters covered by the
    release, and we see no error in his conclusion. The appellants argue that the
    motion judge should have allowed the same matters to proceed to trial to the
    extent they were raised to support a defence of equitable set-off. We disagree.
    The release prohibited the appellants from pursuing claims arising from a broad
    spectrum of matters: it released the underlying basis of those claims, no
    matter the form (equitable set-off or damages in a counterclaim) in which they
    were asserted.

[18]

The appeal is therefore dismissed.

[19]

In
    accordance with the agreement of counsel, the appellants shall pay the
    respondent costs of the appeal in the sum of $8,750, inclusive of disbursements
    and applicable taxes.

J.C. MacPherson J.A.
B. Zarnett J.A.
M. Jamal J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Krieser v. Garber, 2020 ONCA 840

DATE: 20201223

DOCKET: C66850 & C66910

Doherty, Hoy and Jamal JJ.A.

BETWEEN

Shari Krieser

Plaintiff (Respondent)

and

Anna
    Garber, Michelle Garber, Susin Garber,

Mike
    Nealon and Nealon Wood Products Ltd.

Defendants (Appellants)

and

George
    Krieser

Third Party

Peter W. Kryworuk and Jacob R.W.
    Damstra, for the appellants Mike Nealon and Nealon Wood Products Ltd.

A. Irvin Schein and Samantha Schreiber,
    for the appellants Anna Garber, Michelle Garber and Susin Garber

Kenneth Prehogan and Lia Boritz, for the
    respondent

Heard: in writing

On appeal from the judgment of Justice Edward
    M. Morgan of the Superior Court of Justice, dated March 29, 2019, with reasons
    reported at 2019 ONSC 1974.

COSTS ENDORSEMENT

[1]

We have received and reviewed the parties cost submissions.

[2]

There shall be no costs of the appeal and the related motion for
    leave to adduce new or fresh evidence in Court File No. C66850 as between the respondent
    and the appellants Mike Nealon and Nealon Wood Products Ltd.

[3]

The respondent shall be entitled to costs of the appeal in Court
    File No. C66910 on a partial indemnity basis in the amount of $40,000.00,
    inclusive of disbursements and HST, as against the appellants Anna Garber,
    Michelle Garber, and Susin Garber.

Doherty
    J.A.

Alexandra
    Hoy J.A.

M.
    Jamal J.A.