because the city had been named as a
defendant. The city was released from the
action after the pleadings had closed. The
two key factors to be taken into account in
determining whether to permit service of a
jury notice after the close of pleadings
were the circumstances of the delay and
whether there was prejudice to the other
side. The motion judge found that the
delay was not unconscionable and there
was no real prejudice to defendants. The
judge weighed the competing interests
and exercised her discretion in favour of
plaintiff. Her conclusion was entitled to
deference from the appellate court.
Nikore v. Proper, [2010] O.J. No. 1941,
Ont. Div. Ct., per Molloy J. (Greer and
MacKinnon JJ. concurring), Apr. 27/10.
Digest No. 3005-006 (Approx. 8 pp.)
SETTLEMENT – The chambers
judge erred in striking out a paragraph
from the statement of defence alleging
that the parties had already settled the
action.
Appeal from an order striking out a
paragraph from the statement of defence
alleging that the parties had settled the
action. Plaintiff was injured in a motor
vehicle accident when her stopped vehicle
was struck on its left side by a vehicle
driven and owned by defendants. The
chambers judge held that there was a
settlement and that ICBC then repudiated
the agreement by insisting upon terms that
were not agreed upon. Defendants argued
that the basis of the chambers judgment
was that the parties had negotiated a binding contract, but that defendants repudiated the contract by tendering a release
that did not reflect the terms of the agreement. They argued that the judge erred in
his interpretation of the contract and that,
if the interpretation was correct, he nevertheless erred in finding repudiation.
HELD: Appeal allowed. A correct
analysis would have led the judge to consider the evidence and determine whether
it showed, objectively, that the parties
intended a tort settlement, or a tort and no
fault settlement, or whether the evidence
was incapable of supporting either conclusion. Instead of determining the entire
scope of the settlement based on the evidence, the judge instead acknowledged
that there was an offer and acceptance,
and then implicitly concluded that there
was a settlement of the tort claim. He then
proceeded to examine whether the evidence also supported settlement of the no
fault claim. In doing so, he incorrectly
applied the principles of contractual interpretation. In interpreting a contract, the
parties’ outward manifestations of the
scope of the whole settlement were relevant. Looking at all the material facts, the
reasonable objective bystander would have
concluded that the parties intended to
make a final settlement of both the tort
and no fault claims.
Lacroix v. Loewen, [2010] B.C.J. No.
833, B.C.C.A., per Finch C.J.B.C. (Saun-
ders and Chiasson JJ.A. concurring),
May 07/10. Digest No. 3005-007
(Approx. 9 pp.)
CONFLICT OF LAWS
FOREIGN JUDGMENTS – The
appellate court set aside an order recog-
nizing and enforcing two international
arbitral awards and remitted the matter
for a fresh determination.
Appeal from an order recognizing and
enforcing two international arbitral
awards made in favour of respondent.
Respondent was a Russian agro-indus-trial company that agreed to purchase
8,500 pigs from appellant, a Canadian
pig producer. A dispute arose regarding
the health of the pigs and respondent
invoked the arbitration clause in the
agreement. Appellant and certain of its
witnesses refused to participate in the
ensuing hearings on the ground that the
chief executive officer of respondent had
issued death threats. Appellant’s action
for an injunction to prevent the arbitration from proceeding was stayed. The
judge found that respondent’s offer of
another venue for the arbitration was a
complete answer to the alleged death
threats. The arbitration proceeded in
Moscow and respondent was awarded two
judgments of $1,200,000 and $475,000.
An appeal of the order refusing to stay the
arbitration was found to be moot, as the
arbitration had concluded. Respondent
was granted an order in Ontario recognizing and enforcing the judgments.
HELD: Appeal allowed. The judge
erred in refusing to consider and decide
the issue of the death threats. The doctrine of issue estoppel did not apply, as the
appeal decision from the order staying
appellant’s injunction application contemplated raising the issue of the death
threats at any enforcement proceeding.
The stay decision was in the context of an
interim interlocutory proceeding that
sought to prevent the arbitration from
occurring. Judicial observations regarding
the death threats in that specific context
did not bind the judge subsequently
deciding the enforcement proceedings. In
any event, the judge that issued the stay
misapprehended respondent’s offer of a
neutral venue, as the balance of the arbitration would still have occurred in Moscow. Given that the issue of the death
threats had never been decided on its
merits and went to the heart of appellant’s
ability to participate in the arbitration, the
application of issue estoppel was an injustice. The matter was remitted for fresh
determination.
Znamensky Selekcionno-Gibridny
Center LLC v. Donaldson International
Livestock Ltd., [2010] O.J. No. 1744,
Ont. C.A., per Gillese, Rouleau and
Watt JJ. A., Apr. 29/10. Digest No. 3005-
008 (Approx. 6 pp.)
CONTRACTS
IMPLIED TERMS – The appellate
court upheld an implied term in a con-
tract that the husband would pay any
capital gains tax on the deemed dispos-
ition of properties.
Appeal from the dismissal of appellant
wife’s application for an order holding her
husband’s estate liable to pay the capital
gains tax on two lots based upon an
implied term in a contract. In 1987, the
wife transferred two rental properties to
the husband at market price. The wife had
no further involvement with the proper-
ties, and the husband received the rents
and paid all expenses related to the prop-
erties. The husband died in 2007. The
Income Tax Act attributed the capital
gains tax to the wife upon the deemed dis-
position of the properties on the husband’s
death. The chambers judge held that there
was no implied term in the 1987 contract
that the husband would pay the capital
gains tax upon any further disposition of
the rental properties.
CRIMINAL LAW
DEFENCE OF PROPERTY – A mil-
itary judge did not err in rejecting the
defence of property as justifying an
assault.
Appeal from a judgment of the Court
Martial Appeal Court of Canada upholding appellant’s conviction on a charge of
assault. Appellant, a Lieutenant-Colonel
in the Canadian military, had an argument
with his wife. His wife took a mounted
diploma off the wall and threw it on the
floor. Appellant then pushed her and she
fell backwards onto the staircase. She
bruised her back, legs and elbow and
broke her finger. He was charged with
assault causing bodily harm. Appellant
conceded that he intentionally applied
force to his wife without her consent.
However, he argued that under subs. 39( 1)
of the Criminal Code, the assaultive
behaviour was justified because he was
protecting his personal property, namely,
the diploma. The military judge found that
there was an air of reality to that defence,
but that appellant used more force than
was necessary in defence of his personal
property. Consequently, the subs. 39( 1)
defence could not serve to justify his
actions. Appellant was convicted of the
lesser and included offence of assault.
HELD: Appeal dismissed. The military
judge did not err in his approach to reasonable doubt. Concerning the defence of
property, a subjective belief about what
force was required was relevant, but the
subjective belief had to be based on
grounds that were objectively reasonable
in the circumstances. The judge determined whether appellant used no more
force than was necessary to defend his
possession in all the circumstances based
on both subjective and objective criteria.
He accepted the sentimental and symbolic
value of the diploma from appellant’s perspective, and considered both the risk of
harm to which the diploma was exposed
by the wife throwing it on the floor and the
fact that it could be replaced. The conclusion that the use of force was disproportionate was eminently justified based on
the legal and factual contexts.
R. v. Szczerbaniwicz, [2010] S.C.J.
No. 15, S.C.C., per Abella J. (McLachlin
C.J. and LeBel, Deschamps and Roth-
stein JJ. concurring), reasons dissent-
ing by Binnie J. (Fish J. concurring),
May 06/10. Digest No. 3005-010
(Approx. 16 pp.)
FORFEITURE OF ITEMS SEIZED –
The court refused to make an order for
the forfeiture of funds seized from an
accused when he was arrested because
the charges were later withdrawn.
Application by the Crown for forfeiture
of funds seized from accused at the time of
his arrest. A police officer stopped accused
vehicle. When the officer approached the
vehicle, he noted a strong odour of fresh
marijuana and observed the accused looking for something between the front seats.
When the accused retrieved his licence
and registration, the officer noticed two
pill bottles and two large bundles of $100
bills. The officer then searched the vehicle
and found two large empty garbage bags
containing traces of marijuana, various
gardening tools, a garage door opener and
five separate sets of keys containing 20 to
30 keys. In addition, the officer seized two
bundles of money totalling $9,610.
Accused was arrested and ultimately
charged with possession for the purpose of
trafficking, possession of marijuana and
possession of proceeds of crime. The charges against accused were ultimately withdrawn as there was a concern as to whether
the police officer had reasonable and probable grounds to search accused’s vehicle.
However, the Crown applied for an order
of forfeiture of the funds seized from
accused at the time of his arrest. Accused
later consented to forfeit all but $2,500 of
the funds.
HELD: Application dismissed. There
was no evidence as to whether the currency was proceeds of unlawful activity or
an instrument of unlawful activity. The
court declined to draw an adverse inference from accused’s consent to a forfeiture
of a portion of the funds as the onus was
on the Crown to establish that the currency qualified for forfeiture. Even if the
Crown had proven that the currency was
proceeds of unlawful activity, because of
the possibility of a violation of accused’s
Charter rights and the withdrawal of the
charges, it would be unjust to make an
order of forfeiture.
Ontario (Attorney General) v.
$9616.98 in Canadian Currency (In
Rem), [2010] O.J. No. 1783, Ont. S.C.J.,
Kiteley J., Apr. 28/10. Digest No. 3005-
011 (Approx. 6 pp.)
DAMAGES
PUNITIVE DAMAGES – A jury did
not err in awarding punitive damages
against an insurer for the way in which
it handled respondents’ claim.
Appeal from an award of punitive damages. Appellant insurer denied the
respondents’ insurance claim arising from
windstorm damage to their dairy barn.
Respondents sued and a jury found that
they were entitled to the maximum
amount of their coverage. The jury also
awarded respondents punitive damages of
$55,000 for the manner in which the
insurer conducted its investigation into
the insurance claim. The jury specifically
made a finding of bad faith in relation to
the insurer’s denial of coverage under the
policy. On appeal, the insurer argued that
its investigation into the claim may not
have been perfect, but was not so outrageous as to be deserving of punishment,
