COURT OF APPEAL FOR ONTARIO

CITATION: Health Genetic Center Corp.
    (Health Genetic Center) v. New Scientist Magazine, 2019 ONCA 576

DATE: 20190705

DOCKET: M50445 (C66385)

Brown
    J.A. (Motions Judge)

BETWEEN

Health Genetic Center Corp. o/a Health
    Genetic Center

and Yuri Melekhovets

Plaintiffs

(Appellants/Responding
    Parties)

and

New Scientist Magazine,
Peter Aldhous
and
Reed Business

Information Ltd.

Defendants

(
Respondents/Moving Parties
)

Sandra Barton, for the moving
    parties/respondents

Karen Zvulony, for the responding
    parties/appellants

Heard: June 25, 2019

REASONS
    FOR DECISION

I.        OVERVIEW

[1]

The appellants, Health Genetic Center Corp. o/a
    Health Genetic Center and Yuri Melekhovets, brought a defamation action against
    the respondents, Peter Aldhous and Reed Business Information Ltd. The
    appellants alleged that an article in the New Scientist Magazine that
    questioned the reliability of a blood paternity test they marketed defamed them.
    After a 13-day hybrid trial, the trial judge dismissed their action: 2018 ONSC
    7224. The trial judge awarded the respondents costs of the action in the amount
    of $1,478,766.64: 2019 ONSC 575.

[2]

The appellants appeal the dismissal of their
    action and the award of costs. The appellants have perfected their appeal.

[3]

Prior to trial, the appellants paid into court
    $300,000 as security for costs. The respondents now move for an order requiring
    the appellants to pay more: (i) $85,000 as security for the costs of the
    appeal; and (ii) $1,178,766.64 as security for the costs awarded at trial.
    Alternatively, the respondents seek an order lifting the automatic stay of the
    cost award pursuant to r. 63.01(5) of the
Rules of Civil Procedure
.

[4]

The appellants oppose the motion.

[5]

The respondents contend security for costs
    should be ordered for two main reasons: (i) the appeal is frivolous and
    vexatious; and (ii) the appellants have insufficient assets to pay the costs of
    the appeal and the trial. The respondents rely upon a combination of rr.
    61.06(1)(a), (b) and (c), r. 56.01, including rr. 56.01(1)(d) and (f), and s.
    12 of the
Libel and Slander Act
, R.S.O. 1990,
    c. L.12. Under the latter provision, the respondents contend that it is not
    necessary to demonstrate that the appeal is vexatious.

[6]

I will start my analysis by considering the respondents
    claim under r. 61.06(1)(a), which provides that: In an appeal where it appears
    that, (a) there is good reason to believe that the appeal is frivolous and
    vexatious and that the appellant has insufficient assets in Ontario to pay the
    costs of the appeal  a judge of the appellate court, on motion by the
    respondent, may make such order for security for costs of the proceeding and of
    the appeal as is just.

[7]

I will then consider the respondents claim
    under r. 61.06(1)(b), which deals with the situation where an order for
    security for costs could be made against the appellant under rule 56.01. The
    respondents rely on r. 56.01(1)(f)  namely, where statute entitles the
    defendant or respondent to security for costs. The statute the respondents
    rely on is s. 12 of the
Libel and Slander Act
.
    Next, I will deal with the respondents claim under r. 61.06(1)(c). Finally, I
    will consider their alternative request to lift the automatic stay of the trial
    costs award.

II.
CLAIM FOR
    SECURITY OF COSTS UNDER R. 61.06(1)(a)

Governing principles

[8]

An order for security of costs on appeal under
    r. 61.06(1) is not a routine order:
Schmidt v. Toronto Dominion Bank
(1995), 24 O.R. (3d) 1 (C.A.), at p. 5. The principles governing a
    motion for security for costs on appeal are summarized in
Yaiguaje
    v. Chevron Corporation
, 2017 ONCA 827, 138 O.R. (3d) 1, at paras. 18, 19,
    22, 24 and 25:

Rule 61.06 is permissive, not mandatory. In an appeal, there is
    no entitlement as of right to an order for security for costs. Even where the
    requirements of the rule have been met, a motion judge has discretion to refuse
    to make the order:
Pickard v. London Police Services Board
, 2010 ONCA
643,

268 O.A.C. 153,

at para. 17.

In determining whether an order should be made
    for security for costs, the
overarching principle to be applied to all
    the circumstances is the justness of the order sought:
Pickard
, at
    para. 17 and
Ravenda Homes Ltd. v. 1372708 Ontario Inc.
, 2017 ONCA
556,

at para. 4.

In deciding motions for security for costs
    judges are obliged to first consider the specific provisions of the Rules
    governing those motions and
then effectively to take a
    step back and consider the justness of the order sought in all the circumstances
    of the case, with the interests of justice at the forefront.
While the
    motion judge concluded that an order for security for costs would be just, with
    respect, she failed to undertake the second part of that analysis. The failure
    to consider all the circumstances of the case and conduct a holistic analysis
    of the critical overarching principle on the motion before her constitutes an
    error in principle. It therefore falls to this panel to conduct the necessary
    analysis of the justness of the order sought.

Courts in Ontario have attempted to articulate
    the factors to be considered in determining the justness of security for costs
    orders. They have identified such factors as the merits of the claim, delay in
    bringing the motion, the impact of actionable conduct by the defendants on the
    available assets of the plaintiffs, access to justice concerns, and the public
    importance of the litigation. See:
Hallum v. Canadian Memorial
    Chiropractic College
(1989), 70 O.R. (2d) 119 (H.C.);
Morton
    v. Canada (Attorney General)
(2005), 75 O.R. (3d) 63
    (S.C.);
Cigar500.com Inc. v. Ashton Distributors Inc.
(2009), 99 O.R. (3d) 55 (S.C.);
Wang v. Li
,

2011 ONSC 4477 (CanLII)
    (S.C.); and
Brown v. Hudsons Bay Co.,
2014
    ONSC 1065, 318 O.A.C. 12 (Div. Ct.).

While this case law is of some assistance,
    each case must be considered on its own facts. It is neither helpful nor just
    to compose a static list of factors to be used in all cases in determining the
    justness of a security for costs order. There is no utility in imposing rigid
    criteria on top of the criteria already provided for in the Rules. The correct
    approach is for the court to consider the justness of the order holistically,
    examining all the circumstances of the case and guided by the overriding
    interests of justice to determine whether it is just that the order be made.

Good reason to believe the appeal is
    frivolous and vexatious

[9]

In ascertaining whether there is good reason to
    believe that the appeal is frivolous and vexatious, the court need not reach a
    definitive conclusion. Rather, the language suggests a tentative conclusion of
    absence of merit:
York University v. Markicevic
, 2017 ONCA 651, at para. 24.

[10]

The case law indicates that in order to satisfy
    the frivolous and vexatious element of r. 61.06(1)(a), the moving party must
    demonstrate two matters. First, the moving party must show that there is good
    reason to believe that the appeal appears to be devoid of merit:
Schmidt
, at p. 5. In this regard, the cases emphasize that the moving party
    need not go so far as demonstrating that the appeal is, in fact, devoid of
    merit, only that there is good reason to believe that it appears to be devoid
    of merit. A fine distinction, perhaps, but one repeated in the jurisprudence.

[11]

Second, the moving party must demonstrate that
    there is something that supports the conclusion that the appeal is vexatious
    in the sense that it is taken to annoy or embarrass the respondent or has been
    conducted in a vexatious manner:
Chinese Publications for Canadian
    Libraries Ltd. v. Markham (City)
, 2017 ONCA 968, at para.
    9. The
Schmidt
case talks in terms of the
    presence or absence of an oblique motive for the launching of the appeal: at p.
    6.

Application of the principles

[12]

On the record before me, I have no hesitation in
    concluding that the appeal is not vexatious. The appellants engaged the process
    of the court to seek a remedy for what they considered to be untruthful and
    damaging statements about their reputation. They lost at trial. Nevertheless,
    they enjoy a statutory right of appeal. They are availing themselves of it. Mr.
    Melekhovets deposed that the driving factor for bringing the appeal is to
    vindicate my reputation and the reputation of HGC. That is not an improper
    purpose or oblique purpose. The appellants have pursued their appeal in an
    appropriate litigation manner and have perfected it. I see nothing that
    suggests the appellants have appealed in order to annoy or embarrass the
    respondents or that their appeal had been conducted in a vexatious manner.

[13]

As to the merits of the appeal, in their initial
    notices of appeal the appellants advanced numerous grounds of appeal alleging
    errors of fact and law by the trial judge in giving effect to the respondents
    defences of justification, qualified privilege, fair comment, and responsible
    communication and in his treatment of the expert evidence. The appellants have
    replaced those notices of appeal with a second supplementary notice that
    advances one basic ground of appeal: they did not receive a fair trial. They
    contend that the trial judges conduct gave rise to a reasonable apprehension
    of bias, on the basis of which a new trial should be ordered.

[14]

Their appeal factum identifies roughly twenty
    instances of conduct by the trial judge that, they contend, exhibit biased
    conduct. The appellants group those instances into five categories: (i)
    disruptions to the fair presentation of evidence; (ii) the judge was not open
    to hearing plaintiffs counsel at times; (iii) the judge appeared to favour
    defence counsel; (iv) helping defence counsel; and (v) the trial judge accepted
    candies from defence counsel. The appellants submit that taken together, these
    instances of conduct by the trial judge give rise to a reasonable apprehension
    of bias.

[15]

The respondents argue that each alleged instance
    of bias is demonstrably false or wrenched from its context. However, my task on
    this interlocutory motion is not to inquire into and determine the merits of each
    alleged instance of bias. My task is to ascertain whether there is good reason
    to believe that the appeal is devoid of merit so as to support, in part, a
    conclusion that the appeal is frivolous and vexatious.

[16]

Judges benefit from a presumption of integrity,
    which acknowledges that they are bound by their judicial oaths and will carry
    out their duties in accordance with their legal responsibilities. The
    presumption can be rebutted by a judges comments or conduct
, but
    the strong presumption of judicial impartiality is not easily displaced. A
    reasonable apprehension of bias requires a real likelihood or probability of
    bias. The test is an objective one, viewed from the perspective of an informed
    and reasonable observer. It is a high burden. In assessing whether a
    judges presumption of impartiality has been displaced, his or her individual
    comments or conduct during the hearing of a matter should not be considered in
    isolation but within the context of the entire proceedings:
Stuart
    Budd & Sons Limited v. IFS Vehicle Distributors ULC
,
    2016 ONCA 60, 129 O.R. (3d) 37, at paras. 45-50;
Chippewas of
    Mnjikaning First Nation v. Chiefs of Ontario
, 2010 ONCA
    47, 265 O.A.C. 247, leave to appeal refused [2010] S.C.C.A. No. 91, at paras.
    230-243.

[17]

I am not persuaded that there is good reason to
    believe that the appeal is devoid of merit.

[18]

One group of allegations of bias advanced on
    appeal involves the degree to which the trial judge questioned various
    witnesses during their examinations-in-chief and cross-examinations. There was
    a context in which that questioning occurred. This was a hybrid trial that
    required the trial judge to read large volumes of written evidence in advance
    of trial which, no doubt, raised questions in the trial judges mind about the
    meaning or significance of pieces of evidence. As well, the parties had entered
    into a pre-trial agreement about the ability of the trial judge to ask
    questions on the written evidence. Whether the trial judges questioning
    crossed any line in this hybrid trial will require an inquiry by the panel into
    the record. At this stage, on the materials before me, I cannot conclude that
    there is good reason to believe that that ground of appeal is frivolous within
    the meaning of the test for security for costs.

[19]

Accordingly, for these reasons, I conclude that
    the respondents have not demonstrated that there is good reason to believe that
    the appeal is frivolous and vexatious.

Good reason to believe the appellants have
    insufficient assets

[20]

Given the conjunctive nature of the elements of
    r. 61.06(1)(a), that finding is sufficient to dispose of the respondents claim
    for relief under that rule. However, I will go on to consider whether there is
    good reason to believe that the appellants have insufficient assets in Ontario
    to pay the costs of the appeal.

[21]

The first question to ask is: what is a
    reasonable estimate of the respondents costs of this appeal?

[22]

The respondents submit a bill of costs that estimates
    anticipated fees for the appeal at about $130,000 on a substantial indemnity
    basis or $86,100 on a partial indemnity basis. I am not persuaded that those estimates
    of costs are either fair or reasonable for purposes of this motion.

[23]

First, the bill contemplates three lawyers
    working on this file. The respondents can ask their lawyers to assign as many
    timekeepers or billers to this file as they wish. However, when assessing the
    reasonableness of costs for the purposes of security for costs, an objective review
    of the estimate is made. I regard this as a two lawyer file - one senior and
    one junior  and not a three-lawyer file.

[24]

Second, the bill of costs includes approximately
    $18,000 for post-hearing costs. That is over-reach. In my view, given the
    narrowness of the issues now at play on this appeal and the familiarity of
    respondents appeal counsel with the record  after all, they were counsel at
    trial  a fair and reasonable amount of partial indemnity appeal costs for
    purposes of this motion would be $30,000. My analysis will proceed on that
    basis.

[25]

The second question to ask is whether there is
    good reason to believe that the appellants have insufficient assets in Ontario
    to pay the estimated costs of the appeal. My review of the record reveals that
    the appellants clearly have sufficient assets in Ontario to pay costs of the
    appeal in the amount of $30,000.

[26]

Mr. Melekhovets, the individual appellant and a
    principal of the corporate appellant, filed an affidavit on this motion
    detailing his personal assets and the financial circumstances of the corporate
    appellant. The respondents contend that Mr. Melekhovets should have provided
    further details about aspects of his personal finances, as well as transfers
    between the corporate appellant and a related company, HealthGene Corp. Yet,
    the respondents did not cross-examine Mr. Melekhovets on the adequacy of the
    financial disclosure in his affidavit. In those circumstances, I give no effect
    to their argument about inadequate financial disclosure.

[27]

Mr. Melekhovets has lived and worked in Ontario
    since 1991. His evidence discloses that he has net equity in real property
    assets located in Ontario of slightly more than $500,000.

[28]

The corporate appellant operates out of premises
    in Ontario. Unaudited financial statements for the corporate appellant were
    filed covering the financial years 2015 through 2018, the last period for which
    statements have been prepared. The statements show that over the period the companys
    annual revenue rose from $670,000 to just over $1 million and retained earnings
    increased from $18,274 to $136,386. During that period, net earnings were modest
    but rising, save for the year ended January 31, 2018 when the company
    experienced a small net loss.

[29]

Given that evidence, I am satisfied that there
    is good reason to believe that the appellants have sufficient assets in Ontario
    to pay the estimated costs of appeal of $30,000.

Conclusion

[30]

For these reasons, I conclude that the
    respondents have not established the elements set out in r. 61.06(1)(a).
    Accordingly, I need not take a step back and consider the justness of the
    order sought in all the circumstances of the case, with the interests of
    justice at the forefront, at least with respect to the claim under r.
    61.06(1)(a).

III.      CLAIM FOR
    SECURITY OF COSTS UNDER R. 61.06(1)(b)

[31]

The respondents also base their claim on r.
    61.06(1)(b), which gives this court the power to order security for costs where
    it appears that an order for security for costs could be made against the
    appellant under r. 56.01. The respondents rely on two aspects of r. 56.01.

[32]

First, the respondents, relying on r.
    56.01(1)(d), argue that it appears the corporate appellant has insufficient
    assets in Ontario to pay the costs of the appeal. I have found to the contrary
    above.

[33]

Second, the respondents point out that r.
    56.01(1)(f) grants the discretion to order security for costs where it appears
    that a statute entitles the defendant or respondent to security for costs.
    The respondents contend that s. 12(1) of the
Libel and Slander Act
entitles them to security for costs. That section provides:

12
(1) In an action
    for a libel in a newspaper or in a broadcast, the defendant may, at any time
    after the delivery of the statement of claim or the expiry of the time within
    which it should have been delivered, apply to the court for security for costs,
    upon notice and an affidavit by the defendant or the defendants agent showing
    the nature of the action and of the defence, that
the
    plaintiff is not possessed of property sufficient to answer the costs of the
    action in case judgment is given in favour of the defendant
, that the defendant has a good defence on the merits and that the
    statements complained of were made in good faith, or that
the grounds of action are trivial or frivolous
, and the court may make an order for the plaintiff to give security
    for costs, which shall be given in accordance with the practice in cases where
    a plaintiff resides out of Ontario, and the order is a stay of proceedings until
    the security is given. [Emphasis added.]

[34]

On its face, s. 12(1) deals with security for costs
    in an action, not on an appeal. Whether the language of r. 61.06(1)(b) is
    sufficient to make s. 12(1) applicable to an appeal is not a matter on which I
    need make any definitive pronouncement for the simple reason that I regard that
    statutory language as functionally equivalent to r. 61.06(1)(a)s use of the
    terms frivolous and insufficient assets. I have found that the respondents
    have not met those requirements of r. 61.06(1)(a). That finding applies equally
    to their claim based on s. 12 of the
Libel and Slander Act

through r. 61.06(1)(b).

IV.     CLAIM FOR SECURITY OF COSTS UNDER R.
    61.06(1)(c)

[35]

Finally, the respondents submit that security
    for costs should be ordered for other good reason pursuant to r. 61.06(1)(c).
    Pointing to the decision of this court in
Henderson v. Wright
, 2016 ONCA 89, 345 O.A.C. 231, at para. 27, the respondents submit
    that in the present case security should be ordered because the appeal has a
    low prospect of success and it would be nearly impossible to collect costs from
    the appellants.

[36]

I see no resemblance between this case and the
    facts in
Henderson
. Here, the individual
    appellant has disclosed the location and value of his residential realty in
    Ontario. He has filed copies of notices of assessment for his personal tax
    returns  a far cry from the all cash appellant in
Henderson
. The financial statements of the corporate appellant have been
    filed. It is a going concern in Ontario and has been for many years. The
    appellants have paid all costs ordered in this proceeding, save for the award
    of trial costs in respect of which they seek leave to appeal. And the
    appellants already have posted $300,000 by way of security for costs. In those
    circumstances, I see no other good reason to order security for the costs of
    the appeal.

V.      CONCLUSION ON RULE 61.06 MOTION

[37]

For those reasons, I am not satisfied that the
    respondents have established the elements required to order security for costs
    under any of rr. 61.06(1)(a), (b), or (c). As a result, I need not consider
    whether under those rules any order for security for costs should also include
    security for the costs awarded at trial.

VI.     LIFTING THE AUTOMATIC STAY

[38]

I will consider the respondents request
    regarding trial costs under their alternative request to lift the automatic
    stay under r. 63.01(5) in respect of the trial costs award. Although the
    respondents advanced this relief in their notice of motion, the argument was
    not developed in their factum.

[39]

In
SFC Litigation Trust v. Chan
, 2018 ONCA 710, I summarized the principles governing a request to
    lift the automatic stay of enforcement pursuant to r. 63.01(5), at paras. 9
    through 12:

Rule 63.01(5) authorizes the lifting of the
    stay pending appeal on such terms as are just. Accordingly, a court should
    consider the general circumstances of the case:
Hall-Chem Inc.
, at para. 6;
Antunes
, at para. 13.
    The court must be flexible and treat each case on its facts:
Stein
    v. Sandwich West (Township)
(1994), 16 O.R. (3d) 321
    (C.A.), at p. 323. A court must be satisfied that, taking all circumstances
    into account, it would be in the interests of justice to lift the stay.

Recent jurisprudence indicates that a court
    should have regard to three principal factors: (i) the financial hardship to
    the respondent if the stay is not lifted; (ii) the ability of the respondent to
    repay or provide security for the amount paid; and (iii) the merits of the
    appeal:
SA Horeca Financial Services v. Light,
2014 ONCA 811, 123 O.R. (3d) 542 at para. 13;
Antunes
at para. 14.

While the first factor goes to the
    respondents need, the latter two reduce the risk that a successful appellant
    will be forced to bear the loss, rendering the appeal moot. The court may
    impose this risk on an appellant in an appropriate case, but there is no reason
    to do so absent evidence of significant prejudice to the respondent from the
    stay:
Stein
at p. 323;
Ryan
at pp. 711-712. Whether the hardship faced by the respondent
    outweighs any risk to the appellant must be determined within the context of
    the case, including: the grounds of appeal, the parties' positions at trial,
    the trial judges reasons and the probable delay before the appeal can be
    heard:
Antunes
at para. 13;
SA
    Horeca Financial Services
at para. 17.

The stay has been lifted where a plaintiff is
    suffering financial hardship, particularly in personal injury and family law
    cases, or has a well-founded fear that the appellant is dissipating or
    divesting assets to avoid payment:
Stein
;
Antunes;
    Peper v. Peper

(1990), 1 O.R. (3d) 145 (C.A.);
Babbitt
    v. Paladin Inc.
(1993)
,
20
    C.P.C. (3d) 399 (Ont. C.A.). However, even where such factors are present, the
    plaintiff must satisfy the court that the prejudice of maintaining the stay
    outweighs the risk of subjecting the appellant to the uncertainties of recovery
    if the appeal is successful:
Antunes,
at para.
    11;
Ryan,
at pp. 711-712;
Stein,
at p. 323.

[40]

I am not prepared to lift the automatic stay in
    respect of the trial judges award of $1,478,766.64 in costs.

[41]

First, the respondents have not provided
    evidence that they would suffer financial hardship in the event the automatic
    stay is not granted. The respondents filed three affidavits from two of their lawyers;
    none contained evidence of any financial hardship to the respondents in the
    event the stay is not lifted.

[42]

Second, I have found that the respondents have
    not established the conditions set out in rr. 61.06(a), (b) or (c) for
    entitlement to an order for security of costs. Had they met those conditions
    and further demonstrated that the justice of the case supported ordering
    security for costs, the respondents could then submit that security for costs
    should cover not only the costs of the appeal, but also the costs of the
    proceeding: r. 61.06(1). Since they have not met those conditions under r.
    61.06(1), I strongly question whether it remains open to them to seek security
    for the costs of the proceeding by asking the court to allow them to execute
    on the costs judgment that is the subject of an appeal. In other words, I am
    not prepared to grant them relief via an indirect route when they did not
    satisfy the conditions of the direct route.

VII.    DISPOSITION

[43]

For the reasons set out above, I dismiss the
    respondents motion.

[44]

The appellants are entitled to their costs of
    the motion on a partial indemnity scale, fixed in the amount of $20,000,
    inclusive of disbursements and applicable taxes, payable within 15 days of the
    date of this order.

David
    Brown J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Holly v. Greco, 2019 ONCA 579

DATE: 20190705

DOCKET: C66177

Feldman, MacPherson and Simmons JJ.A.

BETWEEN

Lauren Holly

Applicant (Respondent)

and

Francis Greco

Respondent (Appellant)

Mathew Fordjour, for the appellant

James B. C. Edney, for the respondent

Heard: May 27, 2019

On appeal from the
    order of Justice Michael R. Gibson of the Superior Court of Justice, dated
    October 18, 2018, with reasons reported at 2018 ONSC 6219.

ADDENDUM

[1]

On June 5, 2019, we released our decision in which we dismissed the
    appellant's appeal from the motion judge's decision not to grant an adjournment
    and to strike out the appellant's Answer and Claim.  The appellant was permitted
    a limited indulgence to some participation at trial, entirely at the trial
    judge's discretion, if and only if he continued to fully comply with his child
    support obligations.

[2]

The parties agreed in oral submissions on May 27, 2019 that the successful
    party would be entitled to their appeal costs, fixed in the amount of $15,000
    inclusive of HST and disbursements.

[3]

The respondent, Lauren Holly, was successful on the appeal and so is
    entitled to her costs in that amount.

Released: K.F. July 5, 2019

K.
    Feldman J.A.

J.C.
    MacPherson J.A.

Janet
    Simmons J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Hurst v. Hancock, 2019 ONCA 606

DATE: 20190716

DOCKET: C66121/M50368

Feldman, Paciocco and Fairburn
    JJ.A.

BETWEEN

Craig Hurst

Plaintiff (Respondent/Moving Party)

and

James Hancock, Darwin Productions Inc.
and
    Tradepoint 360 Inc.

Defendants (
Respondents/Responding Parties
)

and

Graham Partners LLP, Graham, Wilson & Green,
    and HGR Graham Partners LLP

Intervenors (Appellants)

Tim Gleason and Rebecca Glass, for the appellants

Katrina Marciniak, for the respondents/responding
    parties

Manjit Singh and Eric Cheng (Sheung Chi), for the
    respondent/moving party

Heard: May 16, 2019

On appeal from the judgment of Justice Peter J. Cavanagh
    of the Superior Court Justice, dated October 5, 2018, with reasons reported at
    2018 ONSC 5919.

ADDENDUM

[1]

Following release of the reasons of the court dated June 11, 2019, which
    set aside the summary judgment granted to the respondents, including the costs
    of the summary judgment motion, counsel for the plaintiff requested that the
    court address the issue of how the summary judgment costs are to be dealt with.

[2]

We agree that that issue was raised by the plaintiff in his notice of
    motion on the appeal by the intervenors of the summary judgment, although the
    motion dealt primarily with a request for a stay of the costs ordered payable
    by the plaintiff pending the appeal, which request became moot.

[3]

As the action between the plaintiff and the respondents has now been ordered
    to proceed, we order that the costs of the summary judgment motion be payable
    in the cause of the action.

Released: M.F. July 16, 2019

K.
    Feldman J.A.

David
    M. Paciocco J.A.

Fairburn
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Khan v. Ahmad, 2019 ONCA 614

DATE: 20190719

DOCKET: C66636

Hoy A.C.J.O., Trotter and Jamal JJ.A.

BETWEEN

Raheal Khan

Applicant (Respondent)

and

Daud Ahmad

Respondent (Appellant)

Anser Farooq and Shivani Balcharan, for the appellant

Kristen Normandin and Cara Senese, for the respondent

Heard: July 15, 2019

On appeal from the judgment of Justice Douglas K. Gray of
    the Superior Court of Justice, dated January 30, 2019, with reasons reported at
    2019 ONSC 784.

REASONS FOR DECISION

[1]

The mother of two children, a boy, now nine, and a girl, now six years
    of age, died on May 16, 2015 from abdominal cancer. On January 30, 2019, after
    a 13-day trial, the trial judge granted sole custody of the children to their
    father and ordered that their maternal uncle have access to the children one
    weekend per month, commencing at 10:00 a.m. on Saturday and ending at 6:00 p.m.
    on Sunday.

[2]

The father appeals the order granting the uncle access to the children.

Background

[3]

The father and the childrens mother married on May 30, 2004. It was an
    arranged marriage. The father is from Pakistan and the mother, who was born in
    Canada, travelled to Pakistan for the wedding. After the wedding, the father immigrated
    to Canada, and the children were born in Canada.

[4]

The father, who was a medical doctor in Pakistan, had difficulty finding
    work in Canada. He has not qualified as a doctor in Canada. In order to support
    his family, he had to endure part-time work that was, in some cases,
    geographically distant from the mother and the children, who lived in Brampton,
    close to her family. The father visited Pakistan to undertake employment there
    as a physician from time to time in order to maintain his qualifications.

[5]

In August 2014, the mother was diagnosed with cancer. While the mother
    was ill, the father was frequently away, and the mothers family assisted in
    caring for the children. After the mothers death, the father and the children
    moved from their home in Brampton and lived in the uncles house in Milton for
    three months. The uncle picked up the children from school and assisted in
    their day-to-day care. During that time, the father worked out-of-town.

[6]

In August 2015, the father moved the children to an apartment in Niagara
    Falls, closer to where he was working, but the father and the children
    continued to spend time with the uncles family on weekends. In November of
    2015, the father took the children to Pakistan, returning to Milton for the new
    year. The uncle testified that during the first half of 2016, he would see the
    children after school, and the father would come home and have dinner with the
    uncle and the children.

[7]

When the father again took the children to Pakistan in May 2016, the
    uncle brought an application in the Ontario Court of Justice and obtained an
ex-parte
order for custody of the children. The matter was transferred to the Superior
    Court of Justice. From October 20, 2016 until the trial judge released his reasons,
    the children resided with the father and the uncle had access to the children
    on alternating weekends, from Friday after school until Sunday drop-off.

The trial judges reasons

[8]

The trial judge found that the father was providing excellent care for his
    children, he treats them with love and affection, and they love him in return.
    In his view, the uncle did not really seek an order for custody. The uncles
    concern was with where the children would live. The trial judge ordered that
    the father have sole custody of the children.

[9]

On the issue of access by the uncle, the trial judge wrote as follows:

[260] The leading case on the issue of access on the part of a
    non-parent remains
Chapman v. Chapman

(2001), 141 O.A.C. 389 (C.A.). At para. 21, Abella J.A. stated:

In the absence of any evidence that the parents are behaving
    in a way which demonstrates an inability in accordance with the best interests
    of their children, their right to make decisions and judgments on their
    childrens behalf should be respected, including decisions about whom they see,
    how often and under what circumstances they see them.

[261] It is true that the right of a custodial parent to make
    access decisions is not untrammelled. Indeed, in a proper case the court may
    order that a non-parent have custody in a case of contested custody between a
    parent and non-parent:
Law v. Siu
, 2009 ONCA 61, 65 R.F.L. (6th) 37.

[262] In the case before me, I am not convinced that the
    respondent should have the untrammelled right to decide whether the applicant
    has access.

[263] The respondent is correct that there is a great deal of
    animosity, and indeed hatred, between the parties. This means, however, that if
    the respondent is given the right to decide whether access will take place, it
    is highly unlikely that it will occur. While the respondent has testified that
    he is willing to allow visits to occur, I think it is highly unlikely that they
    will, or at least there is a serious risk that they will not occur.

[264] I think it is in the best interests of the children that
    they maintain a relationship with their maternal extended family. They have
    always maintained such a relationship, and it would not be in their best
    interests that it be cut off. In the absence of an order requiring access, I am
    afraid that it may well be cut off.

[265] The Office of the Childrens Lawyer has recommended that
    visits occur on one weekend per month. I agree with that recommendation.
    However, the OCL has not recommended any overnight visits. This may be because
    the children, or at least Rayyan, advised the investigator that they do not
    want overnight visits. However, I am not sure the position of the children is
    that unequivocal. In any event, the decision is not one to be made by them,
    rather it is to be made by the court in the childrens best interests.

[266] The children have had overnight visits for some
    considerable period of time. They clearly love their uncle and the other
    members of his family, although the conflict between the grandparents could be
    problematical.

[267] In the final analysis, I am prepared to order overnight
    access on one night during one weekend each month. I order that the visits
    occur commencing at 10:00 a.m. on Saturday and end at 6:00 p.m. on Sunday. I
    order that the applicant effect the pick-ups and drop-offs, save and except
    where the respondent lives more than 75 kms from the applicants residence, in
    which case the exchanges shall be at a location that is agreed upon, that is
    approximately half-way between the residences, or as fixed by the court if
    there is a dispute.

The issues

[10]

The
    father argues that the trial judge made five errors in ordering that the uncle
    have monthly weekend access to the children:

1.

the trial judge made palpable and overriding errors in finding that it
    was highly unlikely and that there was a serious risk that access would not
    occur, if not ordered by the court;

2.

he failed to provide sufficient reasons for why he disbelieved the
    fathers evidence that he would voluntarily provide the uncle with access to
    the children;

3.

he mistakenly concluded that it was in the best interests of the
    children to maintain a relationship with the uncle in the face of the animosity
    between the parties;

4.

he failed to provide reasons for not accepting the Office of the
    Childrens Lawyers recommendation that the uncle should not be given overnight
    access; and

5.

he failed to consider the possibility of psychological or physical harm
    to the father, on whom the children are dependant, resulting from the access
    order, contrary to this courts decision in
Pollastro v. Pollastro
(1999),
    43 O.R. (3d) 485 (C.A.).

Analysis

[11]

The
    trial judges decision to grant the uncle access to the children was properly
    driven by the childrens best interests and is entitled to deference. We are
    not persuaded that there is any basis to interfere with his decision.

[12]

While
    the father argues that his evidence was that he would provide the uncle with access
    to the children, and that it was therefore a palpable and overriding error for
    the judge to have found that there was a serious risk that the access visits
    would not occur, the fathers evidence at trial was more equivocal. He
    testified that he would provide access on whatever conditions [he and the
    uncle] agree on and that while he had his counsel write that he would not
    provide access to the uncle, no access to uncle means no regular access, but
    he can ask any time. Further, the trial judge explained, at para. 263 of his
    reasons, that the animosity between the parties led him to doubt that regular access
    would occur.

[13]

The
    father correctly argues that acrimony between a custodial party and someone
    seeking access to a child is relevant to at the childs best interests.
    However, the trial judge was clearly alive to the animosity that had developed
    between the parties. Weighing all the facts particular to this case, he
    concluded that an access order was ultimately in the childrens best interests
    as the only way to ensure the childrens continuing beneficial relationship
    with the maternal extended family.

[14]

The
    trial judge also explained why he ordered overnight visits: in his view, it was
    in the childrens best interests. The children had been having overnight visits
    for some time, and while the OCL may not have recommended overnight visits
    because the oldest child advised that he did not want them, the trial judge was
    not persuaded that the childs position was that unequivocal.

[15]

Finally,
    this case is very different from
Pollastro
. In
Pollastro
, the
    mother was forced to flee California and come to Canada with the parties
    six-month-old child as a result of the fathers severe and ongoing violence
    towards her. The father instituted an application under the Hague Convention
    requiring the mother to return to California with the child. Article 13(b) of
    the Hague Convention required consideration of whether there is a grave risk
    that [the childs] return would expose the child to physical or psychological harm
    or otherwise place the child in an intolerable situation. It is in this
    context that Abella J.A., for the court, wrote, in the passage the father
    relies on, that it was relevant, in considering whether the return to
    California would place the child in an intolerable situation, to take into
    account the serious possibility of physical or psychological harm coming to the
    mother on whom the child was totally dependent. Moreover, there was evidence
    that returning the child to California represented a grave risk of exposure to
    serious harm to the child personally.

[16]

In
    this case, the alleged psychological harm to the father results from providing
    access, which he argues he was willing to provide without a court order (albeit
    not on the terms ordered). This case does not involve a determination under the
    Hague Convention, there has never been any violence between the parties or
    involving the children, and there was no evidence  and the trial judge made no
    findings of fact  that the father suffered or was at risk of suffering
    psychological or emotional harm.

Disposition

[17]

Accordingly,
    the fathers appeal is dismissed. The uncle shall be entitled to his costs of
    the appeal, fixed in the amount of $6,300, including HST and disbursements.

Alexandra
    Hoy A.C.J.O.

Gary T. Trotter J.A.

M. Jamal J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: King v. McPherson-King, 2019 ONCA 554

DATE: 20190702

DOCKET: C65820/M50092

Hourigan, Paciocco and Fairburn JJ.A.

BETWEEN

Lindon Jackford King

Appellant

and

Lorna Ann McPherson-King

Respondent

Lindon Jackford King, self-represented

Paul Slan, for the respondent

Heard and released orally: June 27, 2019

On appeal from the
    judgment of Justice Harvison Young of the Superior Court of Justice, dated July
    31, 2018.

REASONS FOR DECISION

[1]

This appeal arises from motions brought
    by the parties in their family law proceeding.

[2]

The appellant moved for joint custody of one of their children,
    Lornella, the payment of $42,120.75 from monies held in trust for a notional
    real estate commission and legal fees associated with the sale of the
    matrimonial home, and reimbursement for utility costs, repairs, and contents
    removed by the respondent from the matrimonial home.

[3]

The respondent moved for an order for sole custody of Lornella, on-going
    and retroactive child support, reimbursement for their child Loralyns
    university expenses, the sharing of s. 7 expenses on a 60:40 basis, the setting
    of the real estate commission at $5,000, and payment of university expenses for
    their child Lindon Jr.

[4]

The relief claimed by the respondent regarding custody was ordered on
    consent. The respondent also succeeded in her claims for child support and s. 7
    expenses, as well as successfully limiting the amount to be paid for real estate
    commission to $5,000. The motion judge noted that she lacked jurisdiction over
    the issues of repairs to the matrimonial home, utility bills, and household
    contents, as those pertained to equalization. Equalization had been dealt with
    on a full and final basis per the order of Faieta J. in March 2018.

[5]

Costs were awarded to the respondent in the amount of $10,500, on the
    basis that the respondent was entirely successful on the motions, except for
    the issue of the real estate legal fees. The motion judge concluded that the
    appellants conduct had resulted in unnecessary time and expense to the parties
    and the court.

[6]

On October 26, 2018, this courts registrar dismissed the appellants
    appeal for delay. On November 21, 2018, Brown J.A. granted leave to the appellant
    to perfect his appeal on consent, on terms that required him to pay child
    support payments.

[7]

The respondent moves to quash the appeal for failure to comply with
    these terms. We decline to make that order, as there is conflicting evidence
    regarding what payments have been made.

[8]

Turning to the grounds of appeal, the appellant submits that the motion
    judge erred by not granting his claims regarding the non-payment of utility
    bills, damage to the matrimonial home, contents of the matrimonial home, and reimbursement
    of Loralyns university expenses. In addition, he submits that the motion judge
    erred in awarding costs against him. In the alternative, the appellant asks
    this court to unlock a retirement pension fund awarded to him from the
    respondents pension fund, to assist in meeting his financial obligations.

[9]

We cannot give effect to these submissions.  The motion judge correctly
    found that she lacked jurisdiction with respect to the issues of repairs to the
    matrimonial home, utility bills, and household contents, as those were part of
    a previous equalization order. In any event, the appellant has failed to
    provide sufficient evidence in support of those claims.

[10]

With
    respect to the contribution to Loralyns university expenses, that was a
    factual determination for the motion judge. It is not our role to reconsider
    her finding based on the appellants assurances before us. Although it is clear
    that the appellant has been a dedicated father to his children and has their
    best interests at heart, we cannot overturn this factual finding on the record
    before us.

[11]

There
    are also no grounds for this court to interfere with the motion judges costs
    award.  The respondent was the more successful party on the motions and costs
    should follow the result. The costs awarded were entirely reasonable.

[12]

With
    respect to the request to unlock the pension, we decline to consider it. That
    relief was not sought below, there is no evidence before us about the pension,
    and the pension administrator is not a party before us.

[13]

The appeal is dismissed, save for one issue. The
    respondent concedes that one half of a mortgage refund is owing to the
    appellant. An order will go on consent therefore that the respondent shall pay
    the appellant $103.34. The respondent is entitled to her costs of the appeal,
    which we fix in the all-inclusive sum of $4,500.

C.W.
    Hourigan J.A.

David
    M. Paciocco J.A.

Fairburn
    J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Khan v. Ramsingh, 2019 ONCA 623

DATE: 20190724

DOCKET: C66098

Hoy A.C.J.O., Trotter and Jamal JJ.A.

BETWEEN

Jamshad Khan

Respondent (Appellant)

and

Nalita Ramsingh

Applicant (Respondent)

Ingrid van Weert, for the appellant

No one appearing for the respondent

Heard: July 16, 2019

On appeal from the order of Justice Frederick L. Myers of
    the Superior Court of Justice, dated October 4, 2018, with reasons reported at
    2018 ONSC 5901.

REASONS FOR DECISION

[1]

This is a fathers second appeal from an order denying him leave to
    bring a Motion to Change what is in effect a final order dated September 20,
    2017 for the custody of and access to his two children and for child support.

[2]

The mother was properly served but did not respond to this appeal.

Background

Events leading to the
    order under appeal

[3]

The father and mother separated in December 2004. They are the parents
    of two children, a daughter, now 18 years of age, and an autistic son, now 14
    years of age. The son requires assistance in dressing himself, reading, writing
    and with school generally.

[4]

Until August 2013, the mother, who is a registered nurse, permitted the
    father to continue to live with her and the children because he had no other place
    to live. In August 2013, the police conducted a drug raid on the mothers home
    while the children were present. They arrested the father, who was subsequently
    convicted of narcotics offences and possession of a firearm. The father was
    incarcerated from 2013 to 2016.

[5]

In September of 2016, the mother commenced an application for sole
    custody of the children, retroactive child support and s. 7 expenses since the
    father was arrested, and an order requiring the father to complete parenting
    and anger management courses, requiring any access by the father to the
    children to be supervised, prohibiting the father from speaking ill of her in
    the presence or hearing of the children or extended family, or discussing with
    the children the dispute between them, and restraining the father from, among
    other things, coming within 500 meters of her and the children.

[6]

In her application, the mother asserts, among other things, that: she
    has been and continues to be the sole caregiver for the children; the father
    exposed the children to adult conflict and disparages her in the presence of
    the children; the father had been verbally and physically abusive to her during
    the relationship; the father has threatened to take the children to Pakistan so
    that she will never see them again; the fathers lack of judgment and criminal
    activities are dangerous for the children; and the individuals the father hangs
    around with are dangerous.

[7]

The father had difficulty in obtaining a Legal Aid certificate, and, as
    a result, difficulty in retaining a lawyer to respond to the mothers
    Application.

The case management judge
    makes a temporary order

[8]

On March 16, 2017, the case management judge made a temporary order on
    consent that the mother would have sole custody of the children; restricting
    the fathers access to the children to telephone access (to be initiated by the
    father only on Sundays between 5:00 and 6:00 p.m. or by the children at any
    time) and to commence only after the father provided stipulated disclosure
    about his criminal convictions; and that the father serve and file stipulated
    documents, including a current sworn financial statement (Form 13), at least seven
    days before the next court date. Without the parties consent, she also ordered
    that the father pay child support based on an imputed minimum wage, serve and
    file his Answer by April 18, 2017, on a peremptory basis, and pay the mother
    costs in the amount of $2,500.

[9]

The appellant served his Answer on a timely basis, but court staff would
    not let him file it because it was not accompanied by a sworn financial
    statement, as required by r. 13 of the
Family Law Rules
, O. Reg. 114/99
. The fathers position
    was that the case management judge had effectively waived that requirement by
    the provision in her March 16, 2017 order requiring him to file a current
    financial statement at least seven days before the next court date. The
    peremptory date for filing his Answer was more than seven days before the next
    court date. Accordingly, in his view, the March 16, 2017 order relieved him of
    the obligation under the
Family Law Rules
to file a sworn financial
    statement with his Answer.

The case management judge
    holds a case conference

[10]

The
    case management judge did not agree with the fathers interpretation of her
    order. At a case conference held on July 12, 2017, the case management judge
    noted that the father had not yet paid the costs that she had ordered and that
    the father was in default, because he had not filed his Answer as required by
    her order of March 16, 2017. In her endorsement, she noted that the mother might
    ask for final orders at the next court date and ordered the father to pay the
    mother a further $800 in costs.

The next court date

[11]

On
    the next court date, on September 20, 2017, the case management judge noted
    that both costs orders remained outstanding and the father had still not filed
    his Answer. She also noted that the father had been represented by a lawyer
    since at least March 16, 2017. She denied the fathers request for a further
    extension. She also ordered that the father shall not bring a Motion to Change
    without leave obtained in advance on a Form 14B motion, maximum 2 pp in support
    not to be served on the other side unless the court orders. She added: The
    court shall take into account the payment of costs in determining whether
    permission should be granted.

The father seeks leave to
    bring a Motion to Change

[12]

The
    father did not appeal any of the orders the case management judge made up to
    and including the September 20, 2017 order. Instead, he paid the outstanding
    costs orders and sought leave to bring a Motion to Change supported by a
    two-page affidavit, dated April 23, 2018.

[13]

In
    paras. 1 through 4 of his affidavit, the father says why in his view the case
    management judges orders were wrong. In doing so, he states in para. 2 that he
    had not been employed for over 12 years, does not speak, read or write English
    well, has no marketable skills, has a criminal record, and has health issues
    that prevent his employment. Para. 5 is as follows:

I have now borrowed money and paid the costs ordered by [the
    case management judge]. I would like to bring a Motion to Change so that there
    can be a hearing on the merits with respect to [the sons] care. He is severely
    autistic and his skills have been regressing. I do not believe that he is
    receiving appropriate care from the [mother]. I dont work and am available to
    give [the son] more attention and care than the [mother] can. It is critical
    for [the son] that the question of who should be his caregiver is decided on
    its merits. In addition, I cannot pay the support ordered by [the case
    management judge]. Support arrears are accumulating. I need a hearing regarding
    whether income should be imputed to me. [The case management judges] Orders
    are extremely disadvantageous to [the son] and me. I wish to bring a Motion to
    Change so that there can be a hearing on the merits.

[14]

On
    April 27, 2018, the case management judge dismissed the fathers motion for
    leave, writing as follows:

All the evidence provided addressed the issue of why the father
    thinks the orders made on September 20, 2017 are wrong. That is not a matter
    for a Motion to Change. This is a matter for an appeal. As the father has a
    lawyer the Court should not have to point this out. No evidence was provided as
    to any change in circumstances since the orders were made.

The father appeals the
    denial of leave to bring a Motion to Change

[15]

The
    father appealed the case management judges April 27, 2018 order to the
    Superior Court of Justice. The Superior Court of Justice appeal court judge
    dismissed the appeal. He rejected the fathers argument that since he had paid
    the outstanding costs awards he was entitled to a hearing on the merits on the
    questions of custody and access.

[16]

The
    father did not provide submissions on the nature of the legal test for leave to
    proceed where a leave requirement has been imposed in cases of default.

[17]

The
    appeal court judge wrote as follows:

I am prepared to assume that in considering whether to grant
    leave to proceed, [the case management judge] was required to consider whether
    [the father] had cured his defaults and whether he advanced a
prima facie
basis to conclude that there has been a material change in circumstances so as
    to give an air or reality to his proposed Motion to Change. While he appears to
    have done the former, he did not do the latter.

[18]

The
    appeal court judge noted that while there was no trial decision, there was
    evidence before the case management judge in the form of the affidavits in the
    continuing record on which she could base her custody, access and support
    orders. Further, because it entailed the exercise of discretion, the decision
    of the case management judge was entitled to deference.

Analysis

[19]

We
    agree with the father that the appeal court judge erred in deferring to the case
    management judges decision in the face of an almost complete absence of
    evidence about the childs best interests. In our view, the case management
    judge erred in denying the father leave to bring a Motion to Change after he
    had cured his default and based only on an affidavit that she had limited to
    two pages.

[20]

In
    order to make custody and access orders in the best interests of the children,
    the court generally needs the participation of both parties:
King v.
    Mongrain
, 2009 ONCA 486, 66 R.F.L. (6th) 267, at paras. 23 and 31. In some
    cases, that may not be possible. In this case, it was.

[21]

Appellate
    courts should give considerable deference to first instance decisions relating
    to custody and access. And r. 2(3) of the
Family Law Rules
appropriately
    gives judges flexibility in how to deal with family law cases, including taking
    steps to save expense and time  so long as they deal with them justly. The
    problem here, in our view, is that
as matters evolved, custody and access orders were made for
    this child in the face of almost a complete absence of written evidence upon
    which to ensure that the orders were, and continued to be, in the childs best
    interests:
King v. Mongrain,
at paras. 34-35.
In this case,
    only the mothers Application and presumably her Form 35.1
Affidavit in
    Support of Claim for Custody or Access
had ever been considered by the
    court in making what would amount to a final order about custody and access. And,
    given the two-page limit placed on any request for leave to bring a motion to
    change, it would be difficult, if not impossible, to make even a
prima facie
case that a different order was needed in the childs best interests.

[22]

As
    the father submits, the case management judges September 20, 2017 order
    effectively made her temporary order of March 16, 2017 into a final order,
    without a determination on the merits, and her decision of April 27, 2018
    effectively foreclosed a hearing on the merits.

[23]

In
    her endorsement of September 20, 2017, the case management judge specifically
    indicated that the court would take into account the payment of costs in
    determining whether permission should be granted to bring a Motion to Change. Given
    that there had been no determination on the merits, the father reasonably
    inferred that if he paid the outstanding costs, the court would grant him leave
    to bring a Motion to Change, permit him to file his Answer, and proceed on the
    Motion to Change to determine the issues on the merits.

[24]

The
    father borrowed money to pay and has paid the outstanding costs. Further, in
    the two-page affidavit, dated April 23, 2018, that he filed with the case
    management judge, he deposed that his sons skills had been regressing  a
    factor clearly relevant to the childs best interests and requiring some
    further inquiry. It appears that the only court-ordered access at the present
    time is the telephone access ordered in the temporary order on March 16, 2017.

[25]

The
    fathers Answer, dated April 18, 2017  which he included in his appeal
    materials, although it was not admitted by either the case management judge or
    the appeal judge and, like the mothers application, is as yet untested  suggests
    that increased access may, in fact, be in the sons best interests. Significantly,
    counsel for the father advises that the father now has access to the son well
    beyond the court-ordered single hour of telephone access each week. Instead, we
    are advised that the father has been seeing the son each week from Thursday
    evening until Sunday. If this is true, this may be a tacit acknowledgement by
    the parties that increased access is desirable and certainly suggests that the
    court should reconsider whether the current access order is in fact in this
    childs current best interests.

[26]

All
    of this leads us to conclude that leave should be granted to the father to
    bring a Motion to Change the parenting terms of the existing order.

Disposition

[27]

Accordingly,
    the appeal is allowed. The matter is returned to the Ontario Court of Justice
    so that the father may bring a Motion to Change the parenting order before a
    different judge.

Alexandra Hoy
    A.C.J.O.

G.T. Trotter J.A.

M. Jamal J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Lafontaine v. Grant, 2019 ONCA 552

DATE: 20190702

DOCKET: M50565

Brown J.A. (Motions
    Judge)

BETWEEN

Louis Lafontaine

Appellant (Moving Party)

and

Alanna Grant

Respondent (Responding Party)

Alex Battick, for the moving party

Robert Sheppard, for the responding party

Heard: June 27, 2019

REASONS FOR DECISION

[1]

The moving party, Louis LaFontaine, seeks an extension of time in which
    to file a motion for leave to appeal from the order of the Divisional Court
    dated April 11, 2019. That order dismissed his appeal from an April 18, 2018
    decision of the Landlord and Tenant Board (the Board), which ordered him to
    pay the respondent, Alanna Grant, $4,885.19.

[2]

The test applicable on a motion to extend the time to appeal is set out
    in
Reid v. College of Chiropractors of
    Ontario
, 2016 ONCA 779, at para. 14. The governing principle is
    whether the justice of the case requires that an extension be given. To that
    end, courts consider four factors, as applied to the circumstances of the case,
    together with the overall interests of justice.

[3]

In the present case, there is no dispute that Mr. LaFontaine formed the
    intention to seek leave to appeal within the prescribed period of time and has
    a reasonable explanation for his delay. Prejudice is not a factor. The factor
    in contention is the merits of Mr. LaFontaines motion for leave to appeal.

[4]

Mr. LaFontaine did not file a copy of the Boards order or reasons with
    his material. However, there is no dispute that the issue before the Board was
    whether the living accommodation that he was renting to Ms. Grant fell within
    the exemption set out in s. 5(i) of the
Residential Tenancies Act
,
    2006, S.O. 2006, c. 17 (the
RTA
) in respect of
living
    accommodation whose occupant or occupants are required to share a bathroom or
    kitchen facility with the owner, the owners spouse, child or parent or the
    spouses child or parent, and where the owner, spouse, child or parent lives in
    the building in which the living accommodation is located.

[5]

As described by the Divisional Court in its brief endorsement, 2019 ONSC
    2321, at paras. 1 and 2:

The Appellant is the landlord of 339 Van Kirk Drive in
    Brampton. The Respondent lived in a room at the property for a period of time.
    She brought an application under the
Residential Tenancies Act, 2006
for
    damages arising from what she alleged was an infestation of bed bugs. A hearing
    date was set before the Landlord and Tenant Board. The Appellant did not
    attend, but instead sent a letter to the Board in which he submitted, among
    other things, that the Board had no jurisdiction to consider the application
    because the property is exempt as a shared accommodation where temporary guests
    reside and occupy common areas and have only a separate bedroom. He indicated
    in his letter that the Board had previously determined that his property was
    exempt.

At the hearing, the Board questioned the Respondent on the
    issue of exemption. The Board determined that on the evidence before it, the
    Respondent was not required to share either the kitchen or the bathroom with
    the Applicant as required for the exemption in section 5(i) of the
Act
to
    apply. The Board found as fact that the Applicant had his own kitchen and
    bathroom in the basement. Having found that the exemption did not apply, the
    Board ruled in favour of the Respondent and ordered payment of $4,885.19.

[6]

The Divisional Court noted that s. 210 of the
RTA
restricts the
    right to appeal from the Board to questions of law. The Divisional Court
    dismissed Mr. LaFontaines appeal on the basis that it did not raise a question
    of law. Instead, that court stated that Mr. LaFontaine was challenging the
    findings of fact made by the Board: [H]e disagrees with the Boards finding
    that he has his own kitchen and bathroom in the basement, and he disagrees with
    the finding that the Respondent was not required to share any such facilities
    with him.

[7]

From the materials filed by Mr. LaFontaine on this motion, it is
    apparent that his quarrel with the Boards decision at most raises a question
    of mixed fact and law  namely, whether the particular configuration of his
    rental accommodation brought it within the exemption in s. 5(i) of the
RTA
.
    The limited right of appeal available under s. 210 of the
RTA
leads me
    to conclude that there is little merit to Mr. LaFontaines proposed appeal of
    the Divisional Courts order. In those circumstances, I do not see that the justice
    of the case requires granting Mr. LaFontaine an extension of time to file a
    motion for leave to appeal.

[8]

Mr. LaFontaines motion for an extension of time is dismissed.

[9]

The respondent is entitled to her costs
    of this motion fixed in the amount of $750, inclusive of disbursements and
    applicable taxes, payable within 15 days of this order.

David Brown J.A.


COURT OF APPEAL FOR ONTARIO

CITATION: Marvelous Mario's Inc. v. St. Paul Fire and Marine
    Insurance Co., 2019 ONCA 635

DATE: 20190731

DOCKET: C65382 and C65383

Hourigan, Paciocco and Fairburn JJ.A.

C65382

BETWEEN

Marvelous Marios Inc., Snack Crafters
    International Inc., 788986 Ontario Inc., 601552 Ontario Ltd. and Mario
    Parravano

Plaintiffs (Appellants)

and

St. Paul Fire and Marine Insurance Co.

Defendant (Respondent)

C65383

AND BETWEEN

Sweet-Ease Inc., Bakemates International Inc.
    formerly 1317613 Ontario Ltd., Confectionately Yours Bakeries Inc., Marmac
    Holdings Inc., formerly 1309411 Ontario Ltd., 788986 Ontario Limited, Mario
    Parravano and Marvelous Marios Inc.

Plaintiffs (Appellants)

and

St. Paul Fire & Marine Insurance Company

Defendants (Respondents)

R. Donald Rollo and Dean Melamed, for the appellants

David A. Tompkins and Trevor J. Buckley, for the
    respondent

Heard: June 27, 2019

On appeal from the judgment of Justice Jasmine T. Akbarali
    of the Superior Court of Justice, dated April 24, 2018, with reasons reported
    at 2018 ONSC 1365.

Hourigan J.A
.:

I.

Introduction

[1]

The appellants commenced two actions claiming insurance coverage under a
    commercial insurance policy issued by the respondent. That policy covers
    direct loss from any Peril, including business interruption loss and loss of
    property due to theft or wrongful handling. The first action seeks indemnification
    for lost rental income and a bonus of $950,000 alleged to be owing to the
    appellant Mario Parravano (the First Action). The second action seeks
    indemnification for the alleged theft or wrongful handling of certain equipment
    and related business interruption losses (the Second Action).

[2]

The two actions were tried together in a bifurcated, coverage-only
    trial. The trial judge dismissed the First Action in its entirety. In the Second
    Action, the trial judge dismissed the property claim, but permitted the
    business interruption claim to proceed in part. The appellants appeal the
    dismissal of the First Action and their property claim (as well as part of
    their business interruption claim) in the Second Action. The respondent
    cross-appeals the decision of the trial judge permitting the business interruption
    claim to proceed in part.

[3]

These reasons explain why I would dismiss the appeal and allow the
    cross-appeal. In summary, the trial judge made no error in dismissing the First
    Action because she correctly found that the claims were not for direct losses
    covered by the policy. The trial judge was also correct in dismissing the
    property claim in the Second Action as time-barred by the terms of the policy. However,
    the cross-appeal must be allowed because the trial judge erred in finding that
    the business interruption claim was subject to a rolling limitation period.

II.

Facts

[4]

Mr. Parravano and his
    non-party wife own all the corporate appellants directly or indirectly.
In
    October 1999, a plant operated by a corporation affiliated with the appellants
that produced baked goods and cereal bars
suffered an Indian meal moth infestation.
This infestation affected the production of cereal bars.

[5]

On September 29, 2000, Sweet-Ease Inc., Bakemates International Inc.,
    Confectionately Yours, Inc., Confectionately Yours Bakeries Inc., and Marmac
    Holdings Inc. (collectively, the Bakemates Group of Companies) commenced an
    action under the respondents policy seeking indemnity for business
    interruption and property losses consequent to the infestation (the Original
    Action).

[6]

Apparently by order of

Justice
Spence dated October 3, 2000, KPMG Inc. (KPMG) was
    appointed the receiver-manager of the
Bakemates Group of Companies
.
[1]

[7]

On October 13, 2000,
    the Bakemates Group of Companies, along with 788986 Ontario Limited, Mr.
    Parravano, and Marvelous Marios Inc. commenced the First Action. The First
    Action includes the same claims as the preceding Original Action. However, the
    additional plaintiffs in the First Action
assert that they too have
    valid claims under the policy. The claims made by
Marvelous Marios Inc. and 788986 Ontario Limited
relate to the loss of leasing income for space and equipment they say was
    provided to the Bakemates Group of Companies and for which the Bakemates Group
    of Companies could not pay because they were suffering losses arising out of the
    infestation. In addition, in this action Mr. Parravano claims a $950,000 bonus
    he says he received from and then loaned to one of the Bakemates Group of
    Companies and for which he never received repayment.

[8]

A proposed sale of the assets of the
Bakemates Group of Companies to Amore Sweets was approved by
    order of Farley J. dated December 21, 2000. The transaction closed on December
    28, 2000.

[9]

On November 26, 2002, Mr.
    Parravano, Marvelous Marios Inc., Snack Crafters International Inc., 601552
    Ontario Ltd., and 788986 Ontario Inc. commenced the Second Action. The gravamen
    of that action was the allegation that the receiver committed theft of insured
    equipment and assets by either retaining the items or wrongfully transferring them
    to the subsequent purchaser and that as a consequence of these acts the
    plaintiffs in the Second Action suffered business interruption losses.

[10]

Eventually, KPMG and the respondent settled
    the property and business interruption loss claims made by the
Bakemates
    Group of Companies in the Original Action (and reasserted in the First Action)
for a total payment of $1,848,527.
Justice Ground approved
the
    settlement as well as the activities of KPMG in its receivership role by order
    dated August 6, 2003. Mr. Parravano and his wife unsuccessfully appealed that
    order to this court on the ground that the settlement amount was too low.

III.

Decision Below RELATING TO THE CURRENT APPEAL

[11]

At
    the coverage trial, the First Action was dismissed in its entirety. The trial
    judge found that the infestation was the covered peril and that the losses
    claimed were indirect losses and therefore not covered by the policy. She also
    concluded that the receivership of the Bakemates Group of Companies was not a
    fortuitous event because it was caused or materially contributed to by the
    deliberate acts of the Bakemates Group of Companies that were contrary to their
    obligations to their creditors. Even if the bankruptcy was a fortuitous event,
    the trial judge found that it was not a risk that could be economically
    transferred to the respondent.

[12]

With
    respect to the Second Action, the trial judge concluded that the appellants
    knew or had the means of knowing they had a claim at the time of the sale of
    the assets, being December 28, 2000. Under the terms of the policy, there was a
    one-year limitation period. The action was not commenced until almost two years
    after the sale and thus the claim related to the loss of the equipment was
    time-barred. However, the trial judge determined that the claim for business
    interruption losses was an on-going claim and therefore subject to a rolling
    limitation period. Accordingly, she concluded that only the claims for business
    interruption losses predating one year before the commencement of the Second
    Action were barred due to the contractual limitation period. The claim for
    business interruption losses having occurred within the one-year period before
    commencement of the action was not barred and could proceed.

IV.

Analysis

(i)

First Action: Appeal

[13]

The
    appellants submit that the trial judge erred in law in determining that the
    losses claimed in the First Action were not direct losses under the policy. In
    addition, they assert that the trial judge further erred in applying a damages
    law principle in a coverage-only trial. I reject both submissions.

(a)

Direct Losses

[14]

In
    Rider No. 4 of the policy, the respondent agreed to provide insurance coverage
    for direct loss resulting from any Peril, except those perils specifically
    excluded. The appellants submit that the trial judge erred because she found
    that there could only be one proximate cause for a given direct loss. This
    analysis, they argue, ignores Supreme Court of Canada jurisprudence holding
    that there may be multiple proximate causes.

[15]

I
    am not persuaded by this submission. It is not a fair reading of the trial
    judges reasons to conclude that she considered that there could be only one
    proximate cause. Indeed, the trial judge specifically cited case law wherein
    concurrent causes of damages were considered:
Ford Motor Company of Canada
    Ltd. v. Prudential Assurance Co. Ltd.

(1958),

14 DLR (2d) 7,
    affirmed [1959] S.C.R. 539;
Sherwin-Williams Co. v. Boiler Inspection &
    Insurance Co.
, [1950] S.C.R. 187. Relying on
Ford
, she stated at
    para. 30 that, the cause of the loss or damage covered by the contracts must
    be
a
proximate cause (emphasis added). Clearly, the trial judge
    understood that there could be more than one proximate cause of a direct loss.

[16]

The
    appellants also argue that it is irrelevant that other insured parties received
    insurance monies because under the policy they have a right to be treated
    severally and not jointly. In the appellants submission, the infestation,
    which was a covered peril, led to the eventual bankruptcy of the Bakemates
    Group of Companies. Due to the bankruptcy, they argue, those parties were
    unable to meet their financial obligations and the appellants therefore
    suffered direct losses.

[17]

The
    trial judge correctly rejected this argument and found that the losses alleged
    to have been suffered were the result of the failure of Bakemates Group of
    Companies to meet their financial obligations and not the infestation. This
    finding was amply supported by the record, including evidence that the
    Bakemates Group of Companies sales actually increased after the infestation. I
    would therefore not give effect to this argument.

(b)

Damages Principle

[18]

In
    analyzing the issue of whether the claims were direct losses, the trial judge
    referenced the fact that the Bakemates Group of Companies have already
    recovered their business interruption losses. She stated that to permit the
    appellants to also recover for business interruption losses would amount to a double
    recovery. The appellants seize upon this statement and argue that the trial judge
    erred in law by considering a damages principle in a coverage-only trial.

[19]

I
    reject this submission. Read fairly, the trial judges reference to double
    recovery was part of a proper analysis to ensure that her interpretation of the
    policy does not give rise to results that are unrealistic or that the parties
    would not have contemplated in the commercial atmosphere in which the insurance
    policy was contracted:

Ledcor Construction Ltd. v. Northbridge
    Indemnity Insurance Co.
, 2016 SCC 37, [2016] 2 SCR 23, at para. 50.

[20]

The
    trial judge correctly found that it would be an unrealistic and commercially
    unreasonable result if one insured party was paid for its business interruption
    losses and then did not pay its obligations to a related insured party who could
    then make another claim on the same policy, thereby maximizing the groups
    total insurance recovery.

(ii)

Second Action: Appeal and Cross-Appeal

[21]

In
    the Second Action, the appellants asserted what the trial judge found to be two
    distinct claims: (i) for loss of property due to the alleged theft or wrongful
    handling by the receiver, and (ii) for business interruption losses arising
    from the alleged wrongful deprivation of the property.

[22]

The
    respondent takes the position before the trial judge and on appeal that both
    aspects of the claim are completely time-barred. In particular, the respondent
    argues in cross-appeal that the trial judge erred in holding that the business
    interruption claim was subject to a rolling limitation period such that a
    portion of it could proceed to trial. In their notice of appeal, the appellants
    submit that the trial judge erred in dismissing their loss of property claim
    and part of their business interruption claim as time-barred. However, in their
    subsequent written and oral submissions, the appellants focus on responding to
    the cross-appeal by arguing that the trial judges application of a rolling
    limitation period was not erroneous.

[23]

There
    is no dispute between the parties that the one-year contractual limitation
    period provided for in the policy is enforceable. The policy reads:

ACTION: Every action or proceeding against the insurer for the
    recovery of any claim under or by virtue of this contract is absolutely barred
    unless commenced within one year next after the loss or damage occurs.

[24]

The
    sale by the receiver of the Bakemates Group of Companies businesses as a going
    concern closed on December 28, 2000 and the Second Action was commenced on
    November 16, 2002. The trial judge found that the appellants either knew or
    had the means of acquiring the knowledge that they may have a claim under the
    policy on the closing of the sale to Amore Sweets. Accordingly, she concluded
    that the claim for coverage of the lost property was time-barred. I see no
    error in that analysis and would not interfere with the trial judges order
    dismissing the property portion of the Second Action.

[25]

The
    trial judges finding related to the claim for business interruption losses
    forms the basis for a ground of appeal and the cross-appeal. The entirety of
    her analysis on this issue is as follows:

[
60
] For the reasons set out above, the
    second claim, being the claim for business interruption losses, commenced
    latest on the day the sale to Amore Sweets closed. It was at that time that the
    plaintiffs knew or had the means of acquiring the knowledge that they had a
    claim for business interruption losses arising out of the loss of their
    property.

[
61
] However, a claim for business
    interruption losses is, by its nature, an ongoing claim. As the Saskatchewan
    Court of Appeal stated in
Treeland Motor Inn Ltd. v. Western Assurance Co.
,
1985 CarswellSask 165 (Sask C.A.)
at para. 4,
the alleged interruption of the
    plaintiffs business might have commenced with a particular event (in that
    case, a fire; in this case, the closing of the sale to Amore Sweets) but
    continued to accrue from day to day thereafter, and cannot therefore be said to
    have occurred on the day of the event which triggered it.

[
62
] In effect, the plaintiffs business
    interruption claim is subject to a rolling limitation period. A new claim
    accrues each day for the business losses sustained that day. I thus conclude
    that the plaintiffs claim for business interruption (to the extent it can be proven
    in the next phase of this trial) beginning one year before the commencement of
    the second action is not out of time - that is, the business interruption
    losses suffered commencing November 16, 2001 are not barred by reason of the
    contractual limitation period. To the extent the plaintiffs seek recovery for
    business interruption losses they suffered before November 16, 2001, those
    claims were not advanced within the contractual limitation period and are
    therefore barred.

[
63
] In conclusion on this issue, the claims
    for business interruption losses beginning one year before the commencement of
    the second action are not barred by the contractual limitation period. The
    other claims advanced in the second action are barred.

[26]

It
    is clear from the foregoing that the trial judge found that, for both property
    and business interruption claims, the appellants knew or had the means of
    knowing as of the closing of the sale that they might have a claim under the
    policy. However, because a claim for business losses is on-going in nature,
    the trial judge concluded that it is subject to a rolling limitation period. Turning
    first to the cross-appeal, the issue for determination is whether the trial
    judge erred in law in reaching that conclusion. For the following reasons, I
    conclude that she did.

[27]

I
    start my analysis of this issue with the case relied on by the trial judge,
Treeland
    Motor Inn Ltd. v. Western Assurance Co.
, 37 Sask. R. 289. It was an oral
    endorsement from the Court of Appeal for Saskatchewan consisting of five
    paragraphs, in a situation where the limitation period was missed by one day.
    The policy in issue provided: Every action or proceeding against the insurer
    for the recovery of any claim under or by virtue of this contract shall be absolutely
    barred unless commenced within one year next after the loss or damage occurs.
    The court found that the business interruption losses continued to
accrue from day to day thereafter, and cannot
    therefore be said to have occurred on the day of the event which triggered
    it, namely the day of the fire.

[28]

Treeland
has never been followed in Ontario. It was referenced briefly by Stinson J. in
DK
    Manufacturing Group Ltd. v Co-operators General Insurance Company
, 2016 ONSC 3983. However, he expressly declined to
    decide whether it should be followed. Stinson J. also referenced
Triple
    Five Corp. v. Simcoe & Erie Group
, 102
    A.R. 101 (Q.B.), where the court reached a similar conclusion to
Treeland
. In
Triple Five Corp.
, the insurance company conceded that business
    interruption losses continued to accrue after the accident. Thus, there was no
    analysis of the issue.

[29]

The respondent relies on several decisions of this
    court where a one-year limitation clause with the same or nearly identical
    wording to the limitation clause in the present case was enforced for business
    interruption loss claims:
International Movie Conversions Ltd. v.
    ITT Hartford Canada
, 57 O.R. (3d) 652
    (C.A.);
Boyce v. Co-operators Insurance Company
, 2013 ONCA 298, 116 O.R. (3d) 56;
LeBlanc
    & Royle Enterprises Inc. v. United States Fidelity and Guaranty Co.
, 17 O.R. (3d) 704 (C.A.). As the appellants point
    out, however, in none of those cases did the insured assert that the business
    interruption claims were subject to a rolling limitation period.

[30]

In addition to the foregoing cases, the respondent
    also relies on a decision of this court that did not deal with business
    interruption losses:
Goorbarry v. Bank of Nova Scotia
, 2011 ONCA 793, 109 O.R. (3d) 92. In that case,
    Feldman J.A., writing for the court, rejected the submission that a claim for
    long-term disability was subject to a rolling limitation period. The policy
    provided that a claim had to be asserted within two years of the covered
    event. That term was not defined, but Feldman J.A. found that a covered event
    occurred twice under the policy: first, when the insured provided initial proof
    of disability, and second, when the insured was deemed to have ceased to be
    disabled. Because these events did not reoccur each month, a rolling limitation
    period was inapplicable:
Goorbarry
,
    at para. 13.

[31]

In so ruling, Feldman J.A. distinguished the obiter
    comments of this court in
Wilsons Truck Lines Ltd. v. Pilot
    Insurance Co.
(1996), 31 OR (3d) 127 (C.A.).
    There, the policy required the initial payment for no-fault accident benefits to
    be paid by the insurance company within 30 days of filing and further payments
    to be paid every 30 days. The policy further provided that any action under the
    policy must be commenced within one year of when the cause of action arose. The
    court found that the insureds cause of action crystallized 31 days after he
    made his claim and then stated, If he was entitled to those benefits, his
    right to sue for them accrued every thirty days thereafter:
Wilsons
    Truck Lines
, at p.143. No explanation was
    given regarding why a rolling limitation period would apply in the
    circumstances.

[32]

Another instructive non-business interruption case
    from this court is
Bonilla v. Preszler
, 2016 ONCA 759, 134 O.R. (3d) 478. There, the trial judge granted
    summary judgment and dismissed the appellants action against the respondent
    insurer for terminating the Income Replacement Benefits (IRB) she had been
    receiving. On appeal, the insured argued that her claim was subject to a
    rolling limitation period. This court rejected that argument, finding that, It
    is well established in this courts case law that the limitation period is
    triggered by a single event, which is the refusal of an insurer to pay the IRB
    claimed:
Bonilla
, at para. 10.

[33]

This court most recently considered the availability
    of rolling limitation periods in the context of an alleged breach of a lease of
    commercial property. In
Pickering Square Inc. v. Trillium College
    Inc.
, 2016 ONCA 179,

347 O.A.C. 124,
the defendant tenant paid rent as required but failed
    to operate a business continually on the leased premises as it was obligated to
    do under the lease. The court found that this was a continuing breach because
    the plaintiff chose to affirm the lease and, as a result, the parties were
    required to perform their obligations under it as they fell due:
Pickering
    Square
, at paras. 30-34.

[34]

None of the cases cited above
    are on all fours with the case at bar. The cases relied on by the appellants
    are closer factually to the present case, but they are not binding and are largely
    devoid of analysis.
It is necessary therefore to consider first
    principles to determine whether this is one of those instances where the court
    should recognize a rolling limitation period.

[35]

The
    jurisprudence suggests that a rolling limitation period may apply in a breach-of-contract
    case in circumstances where the defendant has a recurring contractual
    obligation. The question is not whether the plaintiff is continuing to suffer a
    loss or damage, but whether the defendant has engaged in another breach of
    contract beyond the original breach by failing to comply with an ongoing
    obligation. In cases where there have been multiple breaches of ongoing
    obligations, it is equitable to impose a rolling limitation period.

[36]

In
Richards v. Sun Life Assurance Company of Canada
, 2016 ONSC 5492, [2016]
    I.L.R. I-5911, at para. 26, Bale J. distinguished between cases where the
    plaintiff is entitled to periodic payments and cases where the plaintiffs
    entitlement to periodic payment is in issue:

A rolling limitation period may apply to claims for periodic
    payments, in cases where the issue is whether certain payments to which the
    plaintiff is entitled have been made (e.g. payments of rent), as opposed to
    cases where the issue is whether the plaintiff was entitled to the periodic
    payments in the first place. In the former type of case, the material facts
    will have arisen on a periodic basis, and it will not be unfair to require a
    defendant to litigate those facts during the applicable limitation period
    following the date upon which an individual payment became due. However, in the
    latter type of case, the material facts will have arisen at the time that the
    plaintiff alleges he or she first became entitled to periodic payments, and it
    would be unfair to require the defendant to litigate those facts, for a
    potentially unlimited period of time.

[37]

In my view, where the
    trial judge erred was in focussing her analysis on the question of whether the
    appellants were continuing to suffer damages rather than on the issue of
    whether the respondent had a recurring contractual obligation. Unlike
Pickering
    Square
, where
    the tenant had a recurring obligation to occupy the premises every month during
    the term of the lease, the respondent was not obliged to make recurring payments.
    Rather, the policy covered business
interruption
losses and the respondent was obliged to pay
    those losses in their totality, subject to any limits in the policy. The fact
    that there was a 24-month cap on the business interruption losses does not
    convert the respondents obligation to indemnify into a recurring contractual
    obligation. Therefore, this was not a proper case for the application of a
    rolling limitation period.

[38]

The appellants knew as of
    the closing date for the sale of the businesses that they no longer had the
    assets under their control and that consequently they would thereafter suffer business
    interruption losses. While the precise amount of the damages was unknown, the
    appellants knew at that point that they had suffered loss or damage and under
    the policy they were obliged to commence a claim within one year. The fact that
    the extent of damages may not be known with precision does not stop the
    commencement of the limitation period:
Peixeiro v. Haberman
,
[1997] 3 S.C.R. 549, at
    para. 18. The Second Action was consequently time-barred in its entirety.

[39]

Based
    on the foregoing, I would dismiss the appeal and allow the cross-appeal in
    relation to the Second Action.

V.

Disposition

[40]

I
    would dismiss the appeal and allow the cross-appeal, with costs payable by the
    appellants jointly and severally in the agreed-upon all-inclusive amount of
    $20,000. The trial judge made a cost order in relation to the First Action, but
    not the Second Action. The matter is remitted to the trial judge for a
    determination of the costs of the Second Action if the parties are not able to
    reach an agreement in that regard.

Released: C.W.H. July 31, 2019

C.W. Hourigan J.A.

I agree. David M. Paciocco
    J.A.

I agree. Fairburn J.A.

[1]

This order has not been filed on appeal.