Legal Blog:

Contract Termination & Injunction

Bombardier Transportation Canada Inc. v. Metrolinx 2017 Ont SCJ

The contract contained a dispute resolution procedure. After giving a default notice and a notice that the owner might terminate the contract, the contractor, who had invoked the dispute resolution procedures, moved for an injunction to force the owner to continue with the dispute resolution procedures rather than terminate. Based on the unusual facts of the case, the judge granted the injunction.

Fraudulent Conveyance – Limitations

Anisman v. Drabinsky 2020 Ont SCJ

The fraudulent conveyance took place in 2015. The plaintiff did not obtain his judgment until 2018 and did not learn of the fraudulent conveyance until 2019, when he was preparing for a judgment debtor examination. The judge decided the following: (i) there is only a duty to investigate when there is something that leads one to investigate. It makes no sense to require multiple title searches on an ongoing basis when there is nothing to trigger the search. The plaintiff did not discover, nor ought he to have discovered, the fraudulent conveyance until that preparation commenced. (ii) Regardless, the 10 year limitation period in the Real Property Limitations Act applied, not the 2 year limitation period under the Limitations Act, 2002. The judge cited Conde v. Ripley as authority for this proposition.

Costs Thrown Away

Syed v. Petrie 2020 Ont SCJ

A mistrial was granted after the plaintiff collapsed on the witness stand. The judge awarded costs thrown away to the defendant. He noted that there were 3 scenarios for adjournments: (i) one of the parties was at fault and needed the adjournment, (ii) the court had its own scheduling problems, and (iii) a party requested an adjournment as a result of no fault on his part (e.g. death of a witness, illness of counsel, etc.). In the first category, the court will grant the adjournment, but with an order for the payment of costs thrown away. In the 2^nd category, the court will grant the adjournment with no costs to either side. In the 3^rd category, the court will grant the adjournment with costs still being awarded against the party requesting the adjournment. The judge differentiated between fault and responsibility. The party may not have been at fault, but it was still responsible for the wasted costs. Given that there was no fault in this case, the costs ordered to be paid were not payable until the end of trial.

Bankruptcy Misconduct

CBM Ready Mix Division v. 8377278 Canada Inc. 2019 Ont CA

Supplier obtained a default judgment against the contractor for a monetary award only. After the contractor assigned into bankruptcy, the supplier brought a motion seeking a declaration that the default judgment survived the bankruptcy under sections 178 (1)(d) & (h) of the Bankruptcy and Insolvency Act, relying on a breach of the deemed trust. The motion was dismissed and the dismissal was upheld by the Ontario Court of Appeal. The Court referenced its 2018 decision in LPIC v. Rodriguez, noting that it was not the job of a motion judge to go beyond the pleadings and the judgment to make fresh findings of fact.

The Legalese Republished Dora Konomi’s Article

On May 14, 2020, the Hellenic Canadian Lawyers’ Association (the “HCLA”) republished Dora Konomi‘s article on “How to Stay Productive While Working from Home: 10 Things that Work for Me” in its spring Legalese. The Legalese is HCLA’s semi-annual newsletter showcasing the organization’s activities and highlighting its members’ work and contribution.

In this edition, you’ll also find Dora’s spotlight as a past scholarship winner of the 2017 Andromache Karakatsanis Award for outstanding academic achievement and involvement in the Greek community at large.

Find the Legalese here.

Damages & Limitations

G.H.T. Genesis Inc. v. Gaska 2020 Ont SCJ

An employee brought an action for constructive dismissal against an employer. The employer counterclaimed, claiming that as a consequence of the employee’s actions, it was liable to future possible claims by CRA. On a motion for summary judgment, the employer was not able to adduce any evidence as to losses or damages that it sustained, other than speculative and prospective damages regarding taxes owed to CRA (which CRA had thus far not claimed). Accordingly, the judge dismissed the counterclaim, holding that all claims in the counterclaim for indemnification were premature and not actionable because CRA had not as yet made any claims. For claims seeking damages for negligent advice as a result of CRA reassessment, the Ontario Court of Appeal has found that the limitation analysis is fact dependent, but likely begins, at the earliest and possibly later, when CRA reassesses (see see Lipson v. Cassels Brock & Blackwell LLP, 2013 ONCA 165 and Presidential MSH Corp. v. Marr, Foster & Co. LLP, 2017 ONCA 325).

Condo Obligations

Mohamoud v. Carleton Condominium Corporation No. 25, 2020 Ont SCJ

A unit owner commenced an application against a condo alleging that the condo had failed to meet its statutory obligation to maintain and repair the condo’s common elements and had acted towards her in an oppressive or unfairly prejudicial manner. The unit owner complained that the condo’s two roof-top exhaust fans were making a vibrating noise that caused her discomfort. Over 5 years, the condo had attempted to discern the problem and maintain the fans to satisfy the owner and spent approximately $50,000 on its efforts. Ultimately, it replaced the fans which, for the unit owner, reduced the noise to a tolerable level. The judge noted that the condo was not expected to be perfect, but only to act reasonably, and it did so. She dismissed the application and awarded the condo $70,000 in costs. The unit owner had rejected the condo’s offer a couple of months before the hearing of the application to have the application dismissed without costs; big mistake. As an aside, the judge held that the condo’s lawyers should have provided their dockets on the costs hearing, redacted as necessary for privilege, but their failure to do so was ameliorated because their claimed fees and disbursements were less than the unit owner’s.

Hard Times

The Construction Act specifies times by which a lien claimant must perform certain acts or lose the benefit of the Act. By way of an example, a lien claimant must preserve a claim for lien within 60 days of the date that the lien period starts to run or kiss the lien goodbye. Invariably, as is the case with any time limitation, for one reason or another people do not comply with a limitation deadline. Some then attempt to remedy the situation and keep the lien alive. They are almost invariably unsuccessful and sometimes make a bad situation even worse. One example is set out in Pryers Construction Ltd. v. MVMB Holdings Inc., a 2019 decision of the Ontario Divisional Court.