In Paul’s Transport Inc. v. Immediate Logistics Limited, the appellant freight broker fell into arrears in payment of invoices under a freight brokerage agreement. The appellant had been paid for the freight services by its customers but had not remitted payment to the transportion company. A default judgment was entered against the appellant and its principal (for knowing assistance in breach of statutory trust) partly on the basis of deemed admissions. In dismissing the appeal, a five-member panel that Umlauf v. Umlauf (2001), 53 O.R. (3d) 355 (C.A.) is not good law, and instead endorsed the approach articulated in Segraves, Salimijazi, and Nikore. Only allegations of fact set out in a claim can be deemed admitted. Conclusions of law or allegations of mixed fact and law are not to be deemed admitted.

Other topics included mortgage enforcement, family law and abuse of process in the estate administration and dependent’s relief context.

Wishing everyone an enjoyable weekend.

John Polyzogopoulos
Blaney McMurtry LLP
416.593.2953 Email

Table of Contents

Civil Decisions

Paul’s Transport Inc. v. Immediate Logistics Limited, 2022 ONCA 573

Keywords: Contracts, Statutory Trust Obligation, Unjust Enrichment, Quantum Meruit, Default Judgment, Pre-Judgment Interest, Rules of Civil Procedure, Rules 19, 37 & 76, Interest Act, R.S.C. 1985, c. I15, r 4, s 4, Highway Traffic Act, R.S.O. 1990, c. H.8, s 191.0.1(3), Umlauf v. Umlauf (2001), 53 O.R. (3d) 355 (C.A.), Doldo v. 1497601 Ontario Ltd., 2012 ONSC 4833, Air Canada v. M & L Travel Ltd., [1993] 3 S.C.R. 787, Mountain View Farms Ltd. v. McQueen, 2014 ONCA 194, Ken Jackson Construction Ltd. v. Macklin, 2017 ONCA 324, Segraves (otherwise Fralick) v. Fralick, [1951] O.R. 871 (C.A.), Salimijazi v. Pakjou (2009), 58 B.L.R. 4th 113 (Ont. S.C.), Nikore v. Jarmain Investment Management Inc. (2009), 97 O.R. (3d) 132 (S.C.), Energy Fundamentals Group Inc. v. Veresen Inc., 2015 ONCA 514, DBDC Spadina Ltd. v. Walton, 2018 ONCA 60, Ernst & Young Inc. v. Chartis Insurance Company of Canada (AIG Commercial Insurance Company of Canada), 2014 ONCA 78, Ontario (Provincial Police) v. Mosher, 2015 ONCA 722, Park v. Park, 2011 ONSC 4234

Kahsai v. Hagos, 2022 ONCA 576

Keywords: Family Law, Spousal Support, Child Support, R. v. Samaniego, 2020 ONCA 439, Hickey v. Hickey, [1999] 2 S.C.R. 518

Hume v. 11534599 Canada Corp., 2022 ONCA 575

Keywords: Contracts, Real Property, Mortgages, Enforcement, Peaceable Possession, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 134(1)(c), Criminal Code, R.S.C. 1985, c. C-46, s. 41(1), Mortgages Act, R.S.O. 1990, c. M.40, s.2(1) & s. 33(1), Interest Act, R.S.C. 1985, c. I-15, s. 8(1), Hume v. 11534599 Canada Corp., 2021 ONCA 549, 11534599 Canada Corp. v. Hume (1 October 2021), M52791 (C69657) (Ont. C.A.), 11534599 Canada Corp. v. Hume, 2022 ONCA 224, Abu-Saud v. Abu-Saud, 2020 ONCA 824, Royal Trust Corp. of Canada v. 880185 Ontario Ltd. (2005), 198 O.A.C. 235, R. v. Born with a Tooth, 1992 ABCA 244, Royal Trust Corp. of Canada v. Gupta, [1997] O.J. No. 347 (Gen. Div.), Sunrise North Senior Living Ltd. v. The Sheriff (Regional Municipality of York), 2020 ONSC 469, Central Guaranty Trust Co. v. McRae (1993), 13 O.R. (3d) 295 (Gen. Div.), Lee v. Guettler (1975), 10 O.R. (2d) 257 (C.A.), Lusk v. Perrin (1920), 19 O.W.N. 58 (H.C.), Toronto Dominion Bank v. Clarry, 2019 ONSC 5076

Appleyard v. Zealand, 2022 ONCA 570

Keywords: Wills and Estates, Dependent’s Support, Family Law, Family Law Act, R.S.O. 1990, c. F.3, Succession Law Reform Act, R.S.O. 1990, c. S.26, Estates Act, R.S.O. 1990, c. E.21, s 44, Courts of Justice Act, R.S.O. 1990, c. C.43, s 134, Rules of Civil Procedure, Rule 75, Appleyard v. Zealand, 2019 ONCA 4, Omiciuolo v. Pasco, 2008 ONCA 241, BMO Trust Company v. Childs, 2020 ONCA 21, Hoang v. Mann Engineering Ltd., 2021 ONCA 742, Marché D’Alimenation Denis Thériault Ltée v. Giant Tiger Stores Ltd., 2007 ONCA 695, Mascan Corp. v. French (1988), 64 O.R. (2d) 1 (C.A.),  Teitler v. Dale, 2021 ONCA 577, Peoples Trust Company v. Atlas, 2019 ONCA 359, Foy v. Foy (No. 2), [1979] O.J. No. 4386, (1979) 26 O.R. (2d) 220 (C.A.), Wallace v. Crate’s Marine Sales Ltd., 2014 ONCA 671, Euring Estate v. Registrar of the Ontario Court (1997), 31 O.R. (3d) 777 (C.A.), Katz v. Katz, 2014 ONCA 607, Yu v. Jordan, 2012 BCCA 367, Cheng v. Liu, 2017 ONCA 104, 828343 Ontario Inc. v. Demshe Forge Inc., 2022 ONCA 412

Short Civil Decisions

Fletcher v. Ontario, 2022 ONCA 569

Keywords: Aboriginal Law, Indian Treaties, Appeals, Scheduling, Evidence, Restoule v. Canada (Attorney General), 2021 ONCA 779

CIVIL DECISIONS

Paul’s Transport Inc. v. Immediate Logistics Limited, 2022 ONCA 573

[Gillese, van Rensburg, Paciocco, Harvison Young and Copeland JJ.A.]

Counsel:

J.S.G. Macdonald, R. Anmol, and M. Rupoli, for the appellants

G. Hearn and C. Calvert, for the respondent

Keywords: Contracts, Statutory Trust Obligation, Unjust Enrichment, Quantum Meruit, Default Judgment, Pre-Judgment Interest, Rules of Civil Procedure, Rules 19, 37 & 76, Interest Act, R.S.C. 1985, c. I15, r 4, s 4, Highway Traffic Act, R.S.O. 1990, c. H.8, s 191.0.1(3), Umlauf v. Umlauf (2001), 53 O.R. (3d) 355 (C.A.), Doldo v. 1497601 Ontario Ltd., 2012 ONSC 4833, Air Canada v. M & L Travel Ltd., [1993] 3 S.C.R. 787, Mountain View Farms Ltd. v. McQueen, 2014 ONCA 194, Ken Jackson Construction Ltd. v. Macklin, 2017 ONCA 324, Segraves (otherwise Fralick) v. Fralick, [1951] O.R. 871 (C.A.), Salimijazi v. Pakjou (2009), 58 B.L.R. 4th 113 (Ont. S.C.), Nikore v. Jarmain Investment Management Inc. (2009), 97 O.R. (3d) 132 (S.C.), Energy Fundamentals Group Inc. v. Veresen Inc., 2015 ONCA 514, DBDC Spadina Ltd. v. Walton, 2018 ONCA 60, Ernst & Young Inc. v. Chartis Insurance Company of Canada (AIG Commercial Insurance Company of Canada), 2014 ONCA 78, Ontario (Provincial Police) v. Mosher, 2015 ONCA 722, Park v. Park, 2011 ONSC 4234

facts:

In 2015, the parties agreed to a freight brokerage agreement, where the appellant company was the freight broker and would schedule delivery of goods to the clients and the respondent would transport the goods. In August of 2015, the appellant fell into arrears in payment of invoices issued by the respondent. When the respondent re-issued invoices directly to the shippers, it learned that the shippers had already paid the appellant and would not pay again. In late 2015, the appellant ceased to operate, closed its bank accounts, and vacated its business premises.

In 2017, the respondent issued a statement of claim against the appellant corporation and its principals, Mr. C and Mrs. C seeking $100,000 in damages for unpaid invoices, breach of contract, breach of statutory trust obligation, unjust enrichment, and/or quantum meruit. The appellants were noted in default. The respondent sought to enforce the default judgments through writs of seizure and sale. The appellants obtained counsel to set aside the default judgments. Three motions followed. The Third Motion was the subject of this appeal.

The appellants sought to set aside the pre-judgment interest award of $120,000. They also sought to set aside the judgment as against the individual appellant, Mr. C, or alternatively, to vary the principal amount awarded against him to be $59,455.75, rather than $100,000.

A five-member panel heard this appeal, as it required the Court to decide whether Umlauf v. Umlauf (2001), 53 O.R. (3d) 355 (C.A.) is good law.

issues:

(1) Did the motion judge err by dismissing the Third Motion on the basis that the appellants had not filed the necessary evidence?

(2) Did the motion judge err by failing to apply the correct legal test when determining whether to set aside the October 2020 Default Judgment?

(3) Did the motion judge err by upholding the order making Mr. C personally liable for knowingly assisting in a breach of statutory trust?

(4) Did the motion just err by not properly considering the prejudice to the appellants and the integrity of the administration of justice?

holding:

Appeal dismissed.

reasoning:

(1) No.

The appellants submitted that the motion judge erred by dismissing the Third Motion on the ground that they failed to provide the court with the material filed on the Second Motion. The Court did not accept any of the arguments advanced in support of this submission. The appellants had the burden to file the material necessary for the hearing of the Third Motion and the motion judge made no error in finding that they failed to discharge that burden.

As provided by rule 37.10(1), as the moving parties, the appellants had the burden of filing the material necessary for the hearing of the Third Motion. As the responding party, the respondents had no obligation to redress any inadequacies in the material the appellants filed on the Third Motion.

Further, the appellants were wholly misguided in suggesting that if the motion judge felt material was missing, he could have gone through the court’s records and found it. His role was to decide the Third Motion on the Record that was before him. If the motion judge had done as the appellants suggest, it would have been an egregious procedural error on his part – effectively, the motion judge would have abandoned his role as independent arbiter and assumed the mantle of an advocate.

The Court held the appellants were incorrect that the motion judge found the record inadequate because they failed to file the full record on the Second Motion. The Court further agreed with the reasons given by the motion judge for his determination that the record was inadequate for him to decide the issues the appellants raised on the Third Motion.

(2) No.

The Court did not accept that the motion judge applied the wrong legal test in deciding the Third Motion or that he treated it as an appeal. He correctly understood the nature of the Third Motion and the test that was to be applied. The Motion Judge described the Third Motion as a “Rule 19.08 motion to set aside or vary a Rule 19.05 judgment”. The motion judge clearly understood that, on the Third Motion, he was to decide whether the October 2020 Default Judgment should be set aside or varied.

The motion judge stated that he was to apply the “well-known factors” set out at para. 8 of Ken Jackson Construction Ltd. v. Macklin. The factors set out in Ken Jackson are the Mountain View factors. It is true that para. 8 of Ken Jackson does not refer to the statement at para. 47 of Mountain View that the “ultimate” question to be answered on such motions is whether the interests of justice favour granting the order. That may explain why the motion judge did not expressly address that question.

The motion judge did not expressly address the fourth and fifth Mountain View factors. However, the absence of an express determination on those factors did not derogate from the validity of the Motion Judge’s dismissal of the motion.

The Interest Order flowed from the motion judge’s factual finding on the Second Motion that Immediate “was advised that balances due to Paul’s Transport were subject to 2% interest per month”. The Court found no error in the motion judge’s reasons or result on this matter. The appellant bore the onus of demonstrating that the October 2020 Default Judgment (or some part of it) should not have been granted. But the appellants failed to provide the motion judge with a complete record. The motion judge correctly stated that s. 4 of the Interest Act did not apply because the agreement between the parties was verbal, not written.

In the course of dismissing this ground of appeal, the Court held that the motion judge did not rely solely on deemed admissions of allegations set out in the Statement of Claim that there was an “implied” contractual term that invoices bore interest at 2% per month. Such allegations are ones of mixed fact and law. The Umlauf Proposition states that when there are deemed admissions, not only are facts deemed admitted, but conclusions of law are also deemed admitted. Other case law, including Segraves, Salimijazi, and Nikore depart from the Umlauf Proposition. The Court concluded that Umlauf was not good law and should not be followed. Conclusions of law, and of mixed law and fact, are not to be deemed admitted under Rule 19.02(1) where a defendant has been noted in default. However, in this case, the motion judge did not only rely only on deemed admissions to conclude that interest ran at 2% per month.

(3) No.

The appellants submitted that the motion judge erred in failing to set aside the judgment against Mr. C because liability for knowing assistance in breach of trust required proof that (1) the appellant had actual knowledge of the underlying breach, and (2) the underlying breach was part of a fraudulent and dishonest design on the part of Immediate. The Court did not accept this submission.

Pursuant to s. 191.0.1(3) of the HTA, the appellant was required to hold any money received from the shippers, in trust, until it paid the money to the respondent. The appellant did not do that. Instead, it placed the money into its general account and disbursed the money to persons other than the respondent. Contrary to the appellants’ submission, that conduct on the part of respondent was fraudulent and dishonest, as those terms have been interpreted in the knowing assistance jurisprudence.

The Court held that the appellant knew when it paid the money received from the shippers to someone other than respondent that it was taking a risk it would be unable to pay the respondent. Such a risk was an obvious prejudice to the respondent. Because it was statutorily obliged to hold the money for the respondent, the appellant also knew that it had no right to take that risk. Thus, the appellant’s conduct of paying money received from the shippers to persons other than the respondent was a fraudulent and dishonest breach of trust.

As for the appellants’ second submission on this issue – that the evidence supported a judgment of only $59,455.75, not $100,000 – the motion judge rejected it because the appellants had not provided sufficient evidence to support it. The Court held that there is no basis on which to interfere with the motion judge’s determination that the inadequacy of the record precluded him from finding that the appellants had discharged their burden on this issue.

(4) No.

The Court held that ruling on the Second Motion was not a breach of the appellants’ right to be heard because they had no right to be heard on the Second Motion and that, contrary to their assertions, the appellants have been heard on these issues. The Court further held that the appellants have not suffered prejudice and that the integrity of the administration of justice favoured dismissal of the Third Motion.

Kahsai v. Hagos, 2022 ONCA 576

[Tulloch, Lauwers and Paciocco JJ.A.]

Counsel:

A. Martel, for the appellant

A. Campbell, for the respondent

Keywords: Family Law, Spousal Support, Child Support, R. v. Samaniego, 2020 ONCA 439, Hickey v. Hickey, [1999] 2 S.C.R. 518

facts:

The appellant challenged a family law order requiring him to pay child support and spousal support to the respondent. The appellant argued that the trial judge’s management of the trial was unfair and favoured the respondent.

The parties’ relationship began in 1978, in Eritrea. Their oldest child was born there in 1980. In 1984, they immigrated to Canada as a family, settling in Ottawa. The parties separated in 1985 and divorced in 1987. Their oldest child primarily resided with her mother after their separation, but had access to her father. In September 1990, the parties resumed cohabitation. They lived together until September 22, 2013, when the respondent, LK, moved out of the family home to Toronto. During this period of cohabitation, they had two more children, born in 1993 and in 1995. Despite this evidence, the appellant asserted that “[the parties] had never been in a committed relationship either before 1985 or after 1990”

issues:

Did the trial judge err in the order requiring the appellant to pay child and spousal support to the respondent?

holding:

Appeal dismissed.

reasoning:

No.

There was no basis for any of the appellant’s arguments. The trial judge did not misapprehend the issues. Her reasons were clear and addressed each issue comprehensively. The appellant’s complaints related in part to issues on which the trial judge was obliged to make credibility assessments of the parties and their witnesses. These assessments were clear and rooted in the evidence. The appellant took particular issue with the trial judge’s assessment of his credibility. Her finding that the appellant was not credible was well-supported by her references to the inconsistencies in his evidence. The trial judge also pointed to some limitations in the respondent’s evidence. Her credibility assessment was balanced.

Two elements of the appellant’s evidence in particular stood out as especially incredible and implausible. The first element concerned the nature of the relationship. The trial judge found that the date of the marriage was January 10, 1980, as pleaded by the respondent, and not May 15,1978, as set out in the Certificate of Divorce and pleaded by the appellant. While this might have been a mistake, in light of the 1980 date on the Certificate of Divorce, the mistake was immaterial. The trial judge’s decision to accept the respondent’s marriage date was no basis for making the accusation that she was biased and it did not prove the truth of the accusation.

The second element of the evidence that stood out and firmly established the appellant’s lack of credibility concerned his finances. Experts agreed that the financial information provided by the appellant regarding his company, Shamar, was unreliable. In the end, the trial judge found that imputing an income of no less than $100,000 per year to the appellant was warranted. The Court did not believe this was an unreasonable finding. Next, the appellant asserted that the calculation of the lump sum payment in lieu of spousal support was erroneously calculated on a monthly base of about $1,800, rather than the interim amount of $1,000. The number set by the trial judge reflected her determination to put the figure in the high and not the middle range of the support guidelines. One of the trial judge’s reasons for picking the range was compensatory. The appellant asserted that being home-bound and caring for the children could not justify such an award. But that was not the only basis for the compensatory award. The trial judge identified other factors relevant to the setting of the range of spousal support and its duration: “the role [the respondent] adopted during the parties’ relationship, the [parties’] ages, the length of their relationship, and the economic consequences that flowed from their relationship which overwhelmingly were in [the appellant’s] favour”.

The appellant also argued that this was not a proper case in which to give a lump sum award in lieu of periodic spousal support. The trial judge noted the following factors in support of this award: “the length of the relationship, the parties’ ages, the roles adopted during the relationship, the relationship’s economic consequences, and [the respondent’s] strong compensatory claim to support”. The trial judge further noted that the lump sum would provide the respondent with an “immediate capital payment to address her immediate financial situation”, which had been disadvantaged by the parties’ 33-year-relationship. None of these considerations was unreasonable.

Contrary to the appellant’s disparaging submissions, the respondent was a responsible individual who upgraded herself and had made progress in her employment with the federal government. Her child-care and housekeeping responsibilities belied the appellant’s assertions. She plainly made financial contributions to the family throughout the parties’ relationship and deferred her own upgrading to permit the appellant to pursue his more lucrative path. There was no basis for the appellant’s attack on the trial judge’s compensatory approach to spousal support.

Hume v. 11534599 Canada Corp., 2022 ONCA 575

[Strathy C.J.O., Sossin and Favreau JJ.A.]

Counsel:

A.H. Zweig, for the appellant (C69657) / responding party (M53390)

E. Peritz, for the respondents (C69657) / moving parties (M53390)

Keywords: Contracts, Real Property, Mortgages, Enforcement, Peaceable Possession, Courts of Justice Act, R.S.O. 1990, c. C.43, s. 134(1)(c), Criminal Code, R.S.C. 1985, c. C-46, s. 41(1), Mortgages Act, R.S.O. 1990, c. M.40, s.2(1) & s. 33(1), Interest Act, R.S.C. 1985, c. I-15, s. 8(1), Hume v. 11534599 Canada Corp., 2021 ONCA 549, 11534599 Canada Corp. v. Hume (1 October 2021), M52791 (C69657) (Ont. C.A.), 11534599 Canada Corp. v. Hume, 2022 ONCA 224, Abu-Saud v. Abu-Saud, 2020 ONCA 824, Royal Trust Corp. of Canada v. 880185 Ontario Ltd. (2005), 198 O.A.C. 235, R. v. Born with a Tooth, 1992 ABCA 244, Royal Trust Corp. of Canada v. Gupta, [1997] O.J. No. 347 (Gen. Div.), Sunrise North Senior Living Ltd. v. The Sheriff (Regional Municipality of York), 2020 ONSC 469, Central Guaranty Trust Co. v. McRae (1993), 13 O.R. (3d) 295 (Gen. Div.), Lee v. Guettler (1975), 10 O.R. (2d) 257 (C.A.), Lusk v. Perrin (1920), 19 O.W.N. 58 (H.C.), Toronto Dominion Bank v. Clarry, 2019 ONSC 5076

facts:

The appellant held a second mortgage on a residential property owned by the respondents. The respondents defaulted on the mortgage. Soon after the default, there was a fire at the property which became uninhabitable. The appellant then took possession of the property.

The respondents brought an application to regain possession of the property. They also sought orders allowing them to pay out the outstanding mortgage amount and directing the appellant to assign the mortgage to another lender.

The application judge found that the respondents were in arrears on the mortgage, but that the appellant was not entitled to take possession because it had not done so “peaceably”. The application judge determined the outstanding amounts owing under the mortgage and made an order requiring the respondents to pay those outstanding amounts, after which the appellant was to assign the mortgage to another lender. The appellant asserted that it did take “peaceable” possession of the property.

Since the appeal was commenced, the Court denied the appellant’s motion to stay the application judge’s order. Despite being denied a stay, the appellant had failed to assign the mortgage pursuant to the application judge’s order. On that basis, the respondents brought a motion to quash the appeal as an abuse of process.

issues:

(1) Should the appeal be quashed due to the appellant’s failure to comply with court orders?

(2) Did the application judge err in finding that the appellant did not take peaceable possession of the property?

(3) Did the application judge err in determining the outstanding amounts owed under the mortgage?

(4) Should the appellant be required to assign the mortgage to another mortgagee?

holding:

Motion to quash dismissed and appeal allowed in part.

reasoning:

(1) No.

In bringing the motion to quash the appeal, the respondents relied on the decision of the Court in Abu-Saud v Abu-Saud, where an appeal was quashed in the context of a family law proceeding because the appellant had deliberately and persistently failed to pay spousal support. The respondents did not put forward any cases where an appeal was quashed for non-compliance with orders in contexts other than those involving family law proceedings.

It was not appropriate to make such an order in this case. While it was evident that the appellant had failed to comply with the application judge’s order requiring the assignment of the mortgage to a third party, this appeal raised a serious issue regarding the meaning of “peaceable possession”. In addition, the motion and the appeal were scheduled to be heard on the same day, thereby reducing the utility of the motion to quash. Finally, the appellant’s failure to comply with court orders could be addressed by requiring the appellant to assign the mortgage despite its success on this appeal.

(2) Yes.

The manner in which the mortgagee can take possession of the property upon default was circumscribed by the mortgage agreement, the Mortgages Act and the common law. Paragraph 10 of the mortgage agreement entitled the appellant to take “quiet” possession of the property upon default. This term was consistent with s. 7(a)(iv) of the Mortgages Act, which provided that mortgage agreements are to include an implied covenant, unless the parties agree otherwise, “that, on default, the mortgagee shall have quiet possession of the land, free from all encumbrances”. Neither paragraph 10 of the mortgage agreement nor s. 7(a)(iv) of the Mortgages Act set out the manner in which the appellant was entitled to take quiet possession of the property. Accordingly, it was necessary to turn to the common law on the issue, where the case law established that a mortgagee entitled to take possession of a property must do so “peaceably”: Royal Trust Corp. of Canada v. 880185 Ontario Ltd.

The application judge erred in relying on the meaning of “peaceable possession” in the criminal law context, which led to her erroneous finding that the appellant did not take peaceable possession of the property. Words must be interpreted in their proper context. The requirement for “peaceable possession” under s. 41(1) of the Criminal Code as a precondition to the use of reasonable force was a very different inquiry than the issue of whether a mortgagee had taken “peaceable possession” of the property of a defaulting mortgagor.

While it may have been preferable for the appellant to try to communicate with the respondents before taking possession, it was not required to do so. There was also no doubt that it was generally preferable for a mortgagee to obtain a writ of possession before taking possession of a property, especially in the case of residential properties. However, in the unique circumstances of this case, where the property was uninhabited and uninhabitable, the application judge made an error in her interpretation of what it means for possession to be “peaceable”, and in applying that meaning to the facts of this case. She erred in focusing on whether the respondents acquiesced to the appellant taking possession or whether the respondents intended to vacate the property. Instead, she should have focused on the circumstances of the property and the manner in which the appellant took possession.

(3) No.

While the appellant may have been entitled to take possession of the property, the respondents should nevertheless have been able to pay out the amounts owed under the mortgage a long time ago and put this matter behind them. For the most part, the amounts the appellant claimed that the application judge disallowed were not related to the issue of whether the appellant took peaceable possession. For example, the prepayment penalty, the corporate lawyer’s fees and the amounts charged for preparing the statements were all amounts that the application judge found were not supported by evidence or were contrary to the law. There were no errors in these determinations.

The only exception was the charge for property management fees. The application judge disallowed these fees because she found the appellant did not have lawful possession of the property. Given that the appellant incurred these fees as a result of the default and of taking lawful possession of the property, the respondents should have been required to pay these fees.

(4) Yes.

Section 2(1) of the Mortgages Act provides that, when a mortgage comes to term, rather than paying the mortgage out, a mortgagor is entitled to require that the mortgagee assign the mortgage to a third party. Section 2(3) provides that this “does not apply if the mortgagee is or has been in possession” of the property.

Therefore, in the normal course, given the finding that the appellant was in lawful possession of the property, it should not be required to assign the mortgage to another mortgagee selected by the respondents. Rather, it should be entitled to a payout of the amounts owing under the mortgage without having to assign the mortgage. Had the appellant complied with the court orders requiring the assignment of the mortgage, as it was required to do in a timely manner, the mortgage would have been assigned by the time the appeal was heard. Thus, it was just to maintain the term of the application judge’s order that the mortgage be assigned to another lender. The term of the order was varied to allow the respondents to assign the mortgage to a third party of their choice.

Appleyard v. Zealand, 2022 ONCA 570

[Feldman, Roberts and Favreau JJ.A.]

Counsel:

J. Kary, for the appellant

M. J. Sweatman, for the respondent

Keywords: Wills and Estates, Dependent’s Support, Family Law, Family Law Act, R.S.O. 1990, c. F.3, Succession Law Reform Act, R.S.O. 1990, c. S.26, Estates Act, R.S.O. 1990, c. E.21, s 44, Courts of Justice Act, R.S.O. 1990, c. C.43, s 134, Rules of Civil Procedure, Rule 75, Appleyard v. Zealand, 2019 ONCA 4, Omiciuolo v. Pasco, 2008 ONCA 241, BMO Trust Company v. Childs, 2020 ONCA 21, Hoang v. Mann Engineering Ltd., 2021 ONCA 742, Marché D’Alimenation Denis Thériault Ltée v. Giant Tiger Stores Ltd., 2007 ONCA 695, Mascan Corp. v. French (1988), 64 O.R. (2d) 1 (C.A.),  Teitler v. Dale, 2021 ONCA 577, Peoples Trust Company v. Atlas, 2019 ONCA 359, Foy v. Foy (No. 2), [1979] O.J. No. 4386, (1979) 26 O.R. (2d) 220 (C.A.), Wallace v. Crate’s Marine Sales Ltd., 2014 ONCA 671, Euring Estate v. Registrar of the Ontario Court (1997), 31 O.R. (3d) 777 (C.A.), Katz v. Katz, 2014 ONCA 607, Yu v. Jordan, 2012 BCCA 367, Cheng v. Liu, 2017 ONCA 104, 828343 Ontario Inc. v. Demshe Forge Inc., 2022 ONCA 412.

facts:

The appeal involved the estate of PA, who died with a will on July 17, 2013. The administration of his estate was not completed and was delayed because of a myriad of failed objections, motions and appeals brought by the appellant. The appellant was a former spouse and was not a beneficiary under the will. Various claims and objections were brought by the appellant, many which were already determined in previous divorce and bankruptcy proceedings.

The appellant appealed the motion judge’s order dismissing the appellant’s unissued “Claim Against Estate” and “Return of Notice of Motion for Directions” and granting $26,000 in costs to the respondent estate trustee and executrix. The order also required the appellant to bring any claim in issued form against the estate within ninety calendar days after October 1, 2019, failing she would be deemed to have abandoned any claim against the estate. The appellant did not do so and did not seek a stay of the motion judge’s order.

The appeal concerned whether an alleged dependant should have an unlimited right to pursue claims and objections against an estate irrespective of procedural misconduct and delay that amounted to an abuse of process.

issues:

(1) Did the motion judge err in dismissing the appellant’s claims without prejudice to filing them in proper form within ninety days of October 1, 2019?

(2) Should the Court exercise its discretion and extend the time in the motion judge’s order for the appellant to commence an application for dependant support under the Succession Law Reform Act or any other claim?

holding:

Appeal dismissed.

reasoning:

(1) No

(i) Preliminary issue: motion for fresh evidence

The appellant requested an adjournment to permit her to bring a motion to file fresh evidence concerning the January 4, 2019 administrative dismissal of her claims. The request for an adjournment was denied by the panel because there was no basis to allow the last-minute request. The appellant had ample notice of the date of this appeal and could have initiated her motion well in advance. Moreover, there was no indication then of the further materials that the appellant sought to file, nor that they would have affected the outcome of this appeal.

(ii) The motion judge did not err in dismissing the appellant’s claims

The motion judge made no reversible error in his disposition of the appellant’s claims. His disposition did not depend on the administrative dismissal of her claims. Even apart from the administrative dismissal, as the motion judge correctly noted, the appellant’s property claims (including those later asserted under the auspices of an unjust enrichment claim) had already been finally determined in the divorce and/or the bankruptcy proceedings.

The appellant’s vexatious conduct included causing extensive delays, failing to meet deadlines, including those peremptory to her, her dogged pursuit of unissued claims and claims that had already been finally determined, the absence of any cogent evidentiary foundation for her proposed claims, and her failure to pay outstanding costs awards. This included her failure to pay the $5,000 costs award under Woollcombe J.’s August 1, 2017 order, which should have resulted in the dismissal of all her claims and objections.

(iii) The motion judge did not err in the exercise of his case management powers

The excessive and unnecessary delay in these proceedings led a direction by the court on January 4, 2019, under s. 134(1) of the Courts of Justice Act, that a timetable for the timely administration of this estate be established. The motion judge made his order in accordance with that direction.

Setting a timetable is entirely within a case management judge’s discretion: Teitler v. Dale, 2021 ONCA 577, at para. 24. There was no error in the exercise of that discretion.

The motion judge made no error in requiring the appellant to advance her application for dependant support including any other claim within ninety days following October 1, 2019.

The court has a broad discretion to control its process and to make appropriate orders where, as is the case here, proceedings have been conducted in a vexatious manner that amounts to an abuse of process: Peoples Trust Company v. Atlas, 2019 ONCA 359, at paras. 5, 9.

The appellant took myriad steps, brought numerous property and support claims, and raised countless allegations and objections against the estate over the years, except commencing a proper application for dependant support, including any other claims she wished to assert. The motion judge’s order required her to do so within ninety days of October 1, 2019, failing which she would be deemed to have abandoned any claim against the estate. This non-monetary part of the motion judge’s order was not stayed by the appeal nor was a stay sought. As a result, the appellant was required to comply with it. She did not do so. Accordingly, any claims she may have had against the estate were deemed abandoned and were dismissed.

(2) No

As the estate trustee submitted, urging the Court not to exercise its discretion under s. 134 of the Courts of Justice Act to grant any further extension and submitting that the equities favoured the beneficiaries, including PA’s 88-year-old common law spouse, who were left with diminished estate assets because of the appellant’s incessant and unsuccessful litigation and failure to satisfy multiple costs orders.

There was no principled reason to justify granting a further extension of time to the appellant to bring her application for dependant support or any other claim. The appellant had inexcusably delayed for almost nine years the orderly administration of a very simple estate and had depleted the estate’s assets with the unnecessary expense of her many motions, appeals, and objections.

SHORT CIVIL DECISIONS

Fletcher v. Ontario, 2022 ONCA 569

[Brown J.A. (Case Management Judge)]

Counsel:

R. Lake and L.Schaan, for the appellants

M. Fancy, R. Ogden, C. Ma, F. Espirt (Law Clerk), for the respondent, Her Majesty the Queen in Right of Ontario

M. Beggs and M. Torrie, for the respondent, The Attorney General of Canada

A., acting in person

Keywords: Aboriginal Law, Indian Treaties, Appeals, Scheduling, Evidence, Restoule v. Canada (Attorney General), 2021 ONCA 779

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