Legal Blog: Civil Litigation

Dec
11
2017

Default Judgment Set Aside

Redabe Holdings Inc. v. ICI Construction Corp 2017 Ont CA

As a general rule, a defendant is entitled to an order setting aside a default judgment if it is irregularly obtained – without imposition of terms other than, perhaps, costs. In this case, the appellant thought that there was an irregularity until discovering at the appeal hearing itself that the judgment was obtained with an appropriate affidavit that demonstrated sufficient evidence to warrant judgment. The appeal was dismissed, but without costs.

Continue Reading >
Dec
07
2017

Pierringer Agreement

Gendron v. Thompson Fuels 2017 Ont SCJ

Owner, fuel company, and fuel tank manufacturer were litigating over the responsibility of an oil spill. Owner entered into a Pierringer Agreement with the manufacturer. As a result of this agreement, the manufacturer paid a settlement amount to the owner and was no longer a party to the action. Usually, under this type of agreement, there is a provision that should the manufacturer be held to be liable at trial for an amount that is more than it was to pay the plaintiff under the agreement, then the plaintiff would reduce the amount that it received so that the manufacturer would pay only the settlement amount. With this type of agreement, the plaintiff assures itself of a minimum amount and then looks for more from the non-settling defendant, in this case the fuel company. As a basic rule, after the liability proportions have been determined, the plaintiff cannot end up with more than its actual assessed damages. As an example, assume that the plaintiff settles with the settling defendant for $7, its damages are assessed at $10, and the non-settling defendant is held to be 80% liable for the damages. Under this scenario, the plaintiff could receive no more than $3 from the non-settling defendant. Conversely, if the non-settling defendant was held to be 20% liable for the damages, then the plaintiff would receive its $7 from the settling defendant and $2 from the non-settling defendant for a total of $9. The Gendron case dealt with a scenario in which the plaintiff was held to be 60% contributorily negligent for the damages. The non-settling defendant wanted to pay an amount that, when added to the amount that the settling defendant had paid, would equal 40% of the actual damages. Of course, if the settling defendant had paid more than 40% of the actual damages, the non-settling defendant would pay nothing. The judge held that the concept of a plaintiff not receiving more in aggregate then the total amount of its damages applied to its damages before deduction for contributory negligence.

Continue Reading >
Dec
07
2017

Wrongful Dismissal

Krishnamoorthy v. Olympus Canada Inc. 2017 Ont CA

Employee worked for Company A from 2005. In 2005, Company B purchased some of the assets of Company A and made offers of employment to most of the employees of Company A, including the plaintiff. Before starting employment with Company B, the plaintiff executed an employment agreement containing termination provisions. Company B terminated the plaintiff’s employment in 2015 and was prepared to pay the plaintiff in accordance with the employment agreement termination provisions. The plaintiff declined to accept those funds and sued, claiming common law wrongful dismissal damages. The plaintiff relied upon Section 9(1) of the Employment Standards Act, which states that when a purchaser purchases a business and takes over the employment of an employee of that business, the employee is deemed not to have been terminated “for the purposes of this Act.” The plaintiff therefore argued that since, under the Act, the plaintiff remained an employee of Company B, the employment agreement was entered into without consideration and was invalid. The motions judge bought the argument, but the Court of Appeal did not. The Court of Appeal noted that the employment was deemed to be continued only for the purposes of the remedies contained in the Act, not for all purposes, and certainly not to say that there was no consideration for an offer of employment that did not have to be made.

Continue Reading >
Dec
05
2017

Wrongful Dismissal

Mohamed v. Information Systems Architects Inc. 2017 Ont SCJ

Dependent/independent contractor (whom we will refer to as an employee) fired when employer’s client, as was its right, requested that employee not work at its project for security reasons. Before employer had retained employee, employee had informed employer that he had been convicted of assault with a weapon 17 years ago when in high school. Employer relied on the termination clause in the employment agreement. Judge held that the termination provisions were vague or uncertain and struck the provisions. They were vague because one part of termination provisions allowed the employer to terminate for breach of the agreement and another part allowed the employer to terminate if it were in the employer’s best interests. The employer wanted that clause to be interpreted as if employer had ultimate discretion to do anything it wanted. The judge noted that, if this were the case, there would be no need for the clause allowing termination upon breach of the agreement. In essence, the judge held that the clause was vague and inconsistent because the termination clause was “illogical and inconsistent.” The judge also held that there was no need to mitigate because the employer had terminated a fixed term contract. The judge held that there was no difference between an employment contract and independent contractor contract with regard to mitigation.

Continue Reading >
Nov
28
2017

Unjust Enrichment

Direct Equipment Ltd. v. Sundial Homes (Sharon) Limited 2017 Ont SCJ

Supplier of rental equipment attempted to claim, on the basis of unjust enrichment, against the owner of the project for rent due on equipment after the contractor went bankrupt and until the equipment was returned. This claim was in addition to the supplier’s lien claim. The supplier was unsuccessful because there was no evidence that the owner used the supplier’s equipment after the contractor abandoned it on the owner’s site. One cannot have unjust enrichment without first having enrichment.

Continue Reading >
Nov
10
2017

Summary Judgment

Deavitt v. Greenly 2017 Ont Div Ct

Farmers brought an action against neighbouring land owners and the City alleging that, because there was a run-off of bio solids, presumably obtained from a wastewater treatment plant, onto the farmers’ lands, the neighbours and the City were liable for trespass, negligence, and nuisance. The motions judge dismissed a motion for summary judgment that the defendants brought. He decided that he was unable to have a full appreciation of the evidence and therefore the matter had to go to trial. The Divisional Court allowed the appeal and dismissed the farmers’ action. The “full appreciation” test was long gone as a result of the Hyrniak Supreme Court of Canada decision. Now, a motions judge must first determine, based only on the evidence, whether there is a genuine issue requiring a trial. If the judge concludes that there is such a genuine issue, the judge must then determine if the trial can be avoided by using fact-finding powers available to the judge under the Rules. In this case, the farmers had put forward almost no evidence to support their allegations – other than their own observations. Assuming that they had put their “best foot forward”, as they were required to do, they had no evidence to show that there was a genuine issue for trial.

Continue Reading >
Nov
01
2017

Employment Contract

North v. Metaswitch Networks Corporation 2017 Ont CA

Employer terminated employment pursuant to a termination clause in an employment agreement. Court found that that termination clause was initially void because it contravened the Employment Standards Act. The issue was whether the employer could rely on a clause stating that any part of the agreement found to be illegal would be severed from the agreement. The Court held that the severability clause was unenforceable relating to a termination clause. To hold otherwise would incentivize employers to draft contracts contrary to the ESA provisions, but include a severability clause to save the offending provision if the employee had the time and money to challenge the contract in court.

Continue Reading >
Nov
01
2017

Employment Contract

KRG Insurance Brokers (Western) Inc. v. Shafron 2009 SCC

The issue was whether a severability clause could save a restrictive covenant from being too wide so as to be unenforceable. There are two types of severance: blue pencil and notional. Blue pencil severance means that the judge can take a blue pencil, draw a line through the offending provisions, and continue to apply the remainder of the words. Notional severance means reading down an illegal feature of the contract so as to render the contract to be in compliance with law. The Court rejected notional severance outright. It held that blue pencil severance should be resorted to sparingly and only if the part being removed was clearly severable, trivial, and not the main purport of the restrictive covenant.

Continue Reading >
Download our free checklist:
“10 Questions to ask before hiring a law firm”
DOWNLOAD