Law Times

Law Times • March 2, 2015 Page 15 www.lawtimesnews.com was homemaker and primary caregiver to children. Husband was financial provider. Hus- band built successful business. Family trust was established by husband's father. Assets of trust included common non-voting shares of business. Settlement of trust did not allocate any per- centage to be attributed to any of objects of trust. Husband had power of appointment granted to him by trust settlement. One child lived with father and one child lived with mother in mat- rimonial home. Matrimonial home fell into disrepair. Hus- band was to make equalization payment of $1,796,550 to wife. Valuation of business was based on fair market value of preferred shares plus fair market value of Class A, non-voting common shares less taxes on disposition. Evidence did not establish trust was invalid or sham. Trust was valid. Clear intent of trust was to be tax planning tool for dis- cretionary distributions from business to family members. Husband's power of appoint- ment in family trust was prop- erly included as property owned by husband. Husband had un- fettered discretionary power of appointment and had power to distribute trust assets too solely to himself. Wife's interest in discretionary trust was inter- est in property for purposes of equalization. Beneficial interest in trust was not automatically excluded from net family prop- erty merely because it was sub- ject to discretion. Value of wife's discretionary interest as object of family trust was nominal value of $1 because husband had entire discretionary unfettered power in relation to distribution of trust assets. Mudronja v. Mudronja (Oct. 30, 2014, Ont. S.C.J., Seppi J., File No. FS-08-64289-00) 247 A.C.W.S. (3d) 160. Landlord and Tenant RIGHT OF ENTRY Immediate re-entry by landlord did not prejudice its ability to claim for outstanding rent Tenants operated deli in unit of strip mall pursuant to lease with landlord. Part way through term of lease, tenants entered into agreement to sell deli business and assign lease to third party, conditional on tenants obtain- ing landlord's consent to trans- fer lease. Tenants did not obtain landlord's consent and waived condition. Third party went into possession of deli for 20 days and then vacated premises. Landlord advised tenants they were in default because of unap- proved transfer of lease. Without notice, landlord changed locks and later purported to terminate lease. Landlord brought action to recover balance of rent ow- ing under lease. Action was dis- missed. Trial judge found that landlord failed to comply with s. 18 of Commercial Tenancies Act (Ont.), when it changed locks before rent had been unpaid for 15 days. Trial judge found that as landlord terminated lease early, it forfeited right to sue for balance of rent due. Landlord appealed. Appeal allowed. Tenants' fail- ure to plead Act was not bar to trial judge considering it. How- ever, trial judge erred in analysis and application of Act. Proper analysis of ss. 18 and 19 of Act re- quired considering not only tim- ing of re-entry but also whether premises were abandoned when re-entry occurred. When prem- ises were abandoned, immedi- ate re-entry by landlord did not prejudice its ability to claim for outstanding rent. There was no evidence of abandonment ad- duced at trial. Trial judge did not have proper evidentiary founda- tion to conduct analysis of appli- cation of Act. Mason Homes Ltd. v. Woodford (Nov. 20, 2014, Ont. C.A., Alex- andra Hoy A.C.J.O., Gloria Ep- stein J.A., and C. William Hou- rigan J.A., File No. CA C57053) Decision at 227 A.C.W.S. (3d) 559 was reversed. 247 A.C.W.S. (3d) 200. TERMINATION OF LEASE Tenant not entitled to free storage of goods Landlord owned property and leased two units to tenant. Ten- ant failed to make rent payments. Landlord terminated lease pur- suant to written notice delivered to tenant. Tenant did not vacate and left goods on landlord's prop- erty. Landlord changed locks and took possession. Tenant brought action claiming landlord over- charged additional rent for 15 years since beginning of lease. Landlord brought counterclaim for declaration that lease was properly terminated and claimed damages for out-of-pocket ex- penses caused by tenant's fail- ure to remove belongings from premises and for loss of rental income. Defendants bought mo- tion for summary judgment on claim and counterclaim. Motion granted. Action was dismissed. Counterclaim was allowed and landlord was entitled to damag- es. Lease was properly terminat- ed. There was no illegal restraint of tenant's goods. Order regular- ized landlord's possession of ten- ant's goods and made permitted goods to be disposed of without accounting to tenant. Tenant was not entitled to free storage of goods. Landlord was entitled to damages from date tenant ought to have vacated. No trial was re- quired. Brohman v. Heldmann (Nov. 13, 2014, Ont. S.C.J., P.J. Flynn J., File No. C-199-14) 247 A.C.W.S. (3d) 199. Torts NEGLIGENCE Liability to be determined according to ordinary rules of negligence Plaintiff brought action for damages for personal injuries sustained as passenger in mo- tor vehicle accident in shopping center parking lot in December 2007. Defendant driver and de- fendant owner of other vehicle issued third party claim against owner and driver of vehicle in which plaintiff riding. Third party claimed that under s. 16 of Fault Determination Rules, Reg- ulation 668 under Insurance Act (Ont.), he had right of way at time of accident and brought motion for summary judgment dismiss- ing claim against him. Motion denied. Under s. 2 of Regula- tion, Fault Determination Rules existed for insurer to determine degree of fault of own insured for loss or damage arising directly or indirectly from use or operation of motor vehicle in parking lot setting. Under s. 3 of Regulation, fault to be determined without reference to surrounding cir- cumstances, including opera- tion of other vehicles. Under s. 5 of Regulation, ordinary rules of law applied when provisions did not apply. Accordingly, s. 16 of Regulation did not apply to de- termine vault of owner or driver other than own insured. In this case, it applied only for insurer of third party to determine li- ability for damage to other ve- hicles. Turning to ordinary rules of law, rules of Highway Traffic Act (Ont.), did not apply to acci- dents in shopping center parking lots. Liability to be determined according to ordinary rules of negligence. Those imposed duty of care on all drivers notwith- standing any perceived right of way. Whether third party or de- fendant driver breached duty of care could not be resolved sum- marily in these circumstances. Third party claim intertwined with and should proceed to trial along with main action. Ashim v. Zia (Nov. 17, 2014, Ont. S.C.J., Emery J., File No. CV-09- 02609-00) 247 A.C.W.S. (3d) 240. ONTARIO CRIMINAL DECISIONS Appeal FRESH EVIDENCE Trial judge outlined concerns about implausibility of accused's testimony Accused appealed her conviction for importing cocaine. Charge of importing related to accused's arrest when she returned to Can- ada from week in Panama. About two pounds of cocaine were dis- covered in her suitcase. Accused maintained that she had no knowledge that cocaine was in her possession. Accused travelled to Panama with man who paid her $2,000 to accompany and entertain him for week. That man also paid for her airfare and accommodations. According to accused, while in Panama, she and man she was with met up with woman named "Nancy" who spent time with them dur- ing their stay there. Prior to ac- cused's return to Canada, that woman asked accused to carry some clothes and souvenirs for her back to Canada and accused agreed. Accused testified that as she and man were packing their suitcases, he asked her to trans- port bottles of what appeared to be health care products and accused agreed. Upon arrival in Canada, accused was searched at customs. Cocaine was discov- ered in health care bottles and accused was arrested. Accused sought to admit fresh evidence, which consisted of photographs of woman said to be "Nancy" taken from camera found in ac- cused's possession at time of her arrest. Accused asserted that it is relevant because trial judge disbelieved her testimony about Nancy, including fact of Nancy's existence, and this was signifi- cant reason why he rejected her evidence as whole. Applica- tion denied. Rather than dis- believing accused on basis that Nancy did not exist, trial judge considered accused's entire ac- count of her relationship with Nancy. Trial judge outlined his concerns about implausibility of accused's testimony relating to Nancy: accused made no in- quiry and had no knowledge of Nancy's prior connection to man accused was with in Panama, she was unaware of Nancy's surname, she gave no thought to effect of taking shoes and other items from Nancy on maximum weight allowance for her luggage, and vagaries of any plan to return items to Nancy. Court agreed with Crown that nature of fresh evidence, photo- graphs of woman only accused could identify as Nancy, related to non-essential aspect of ac- cused's testimony at trial. Nan- cy was merely part of accused's story that trial judge found did not make sense. Photograph of woman purporting to be Nancy would not have rectified implausibility of accused's tes- timony. Trial counsel, in cross- examination on her affidavit, said that she made decision not to tender photographs into evi- dence at trial as it was her view that they were unnecessary and of no value. Trial counsel was correct. R. v. Harris (Oct. 27, 2014, Ont. C.A., E.A. Cronk J.A., H.S. La- Forme J.A., and P. Lauwers J.A., File No. CA C55199) Decision at 98 W.C.B. (2d) 706 was af- firmed. 117 W.C.B. (2d) 369. POWERS OF APPELLATE COURT Trail judge failing to consider whether horseracing game of mixed chance and skill Trial judge acquitting accused of defrauding public of money waged on horseracing and cheat- ing at play with intent to defraud public. Accused being found in- jecting performance enhancing substances into horses prior to their participation in races. Ac- cused also found with syringe containing performance en- hancing substance. Horses par- ticipating in races with purses after alleged acts committed by accused. Trial judge finding Crown did not prove deprivation element of fraud as no evidence any member of betting public placed bet because knew or did not know of injection. Trial judge holding participants of races rather than public deprived by accused's dishonesty. Trial judge holding no causal connection between deceit and deprivation to public. Trial judge finding horseracing not game within meaning of s. 197 as game of pure skill. Crown's appeal allowed and guilty verdicts entered for fraud charges and new trial ordered for cheating at play charges. Trial judge erred by failing to take reg- ulatory scheme for horse racing into account in considering risk of deprivation to public. Mem- bers of betting public entitled to assume accused would not com- mit significant breaches of regu- latory scheme by injecting hors- es. Bettors deprived of informa- tion about race entitled to know and deprived of race run in ac- cordance with rules. Trial judge erred by misinterpreting "game" defined by ss. 197 and 209. Trial judge failing to consider wheth- er horseracing game of mixed chance and skill. Guilty verdicts should be entered pursuant to s. 684(a)(b)(ii) for fraud charges as necessary factual findings made to support finding of guilt absent legal error. Trial judge did not make necessary factual findings with for cheating at play count as applied wrong legal definition of "game". Criminal Code, ss. 197, 209, 684(1)(b)(ii). R. v. Riesberry (Oct. 28, 2014, Ont. C.A., Janet Simmons J.A., Paul Rouleau J.A., and M. Tull- och J.A., File No. CA C57616) 117 W.C.B. (2d) 388. Mens Rea WEAPONS OFFENCES Trial judge erred by failing to instruct jury accused must have measure of control over gun Jury convicting accused of one count of possession of handgun seized from girlfriend's closet while accused found sleeping there. Accused and girlfriend testifying accused sleeping there only occasionally and not using apartment habitually. Girlfriend pleading guilty to possession of gun in closet after admitting she knew her cousin had stored it there. Accused denying knowl- edge of gun in closet. Trial judge instructing jury knowledge com- ponent of possession could be es- tablished whether accused knew or ought to have known of pres- ence of gun. Trial judge instruct- ing jury conviction for posses- sion could follow if established accused wilfully blind to pres- ence of gun without instruct- ing on need for control. Appeal from conviction allowed and new trial ordered. Trial judge erred by telling jurors knowl- edge could be established if ac- cused "ought to have known" of existence of gun. Trial judge erred by failing to instruct jury accused must have had mea- sure of control over gun even if wilful blindness as to presence established. Proviso could not be applied as errors were serous and went to heart of possession which was live trial issue. R. v. Tyrell (Sep. 3, 2014, Ont. C.A., Doherty J.A., Paul Rou- leau J.A., and G.J. Epstein J.A., File No. CA C57930) 117 W.C.B. (2d) 428. LT CASELAW

• Cover