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PAGE 14 CaseLawLaw FEDERAL COURT OF APPEAL Corporations DIRECTORS Appellant did not exercise requisite degree of care, diligence, and skill Tax Court Judge correctly dis- missed appeal from assessment fi nding appellant liable under s. 227.1 of Income Tax Act (Can.), for failure of MTS to re- mit source deductions of federal and provincial income taxes as well as employment and CPP premiums. Tax Court Judge concluded that appellant had not exercised requisite degree of care, diligence and skill to prevent failure of MTS to remit source deductions and could not rely on s. 227.1(3) to escape liability. Findings were amply supported by evidence. Comparelli v. Canada (Jan. 15, 2010, F.C.A., Letourneau, Noel and Trudel JJ.A., File No. A-90- 09) Decision at 174 A.C.W.S. (3d) 891 was affi rmed. 184 A.C.W.S. (3d) 851 (8 pp.). ONTARIO CIVIL CASES Administrative Law BOARDS AND TRIBUNALS Exercise of revocation power by board of governors of hospital was public in nature Appellant operated community hospital using public funds to care for patients. Respondent was cardiologist. Appellant gave respondent privileges to admit and treat patients in hospital. Respondent had problems gain- ing entry to coverage group in hospital and getting along with other specialists. Board of gov- ernors of hospital revoked privi- leges. Hospital appeal board set aside revocation and ordered that privileges be restored. Find- ing bad faith on part of board of governors trial judge found appellant liable for damages to respondent. Appellant ap- pealed from fi nding of liability and damage assessment. Appeal dismissed. Since hospital was publicly funded exercise by board of governors of revoca- tion power was public in nature. Bad faith exercise of statutory, public power provided basis for tort claim. Evidence supported fi nding of bad faith on part of board. Th ere was no suffi cient basis for revoking respondent's privileges. Respondent's com- petence was never in issue. Tim- ing and manner of revocation informed bad faith fi nding. Privileges were revoked when same had been renewed two months earlier. Privileges were terminated eff ective immedi- ately and respondent was told to leave hospital at once. Board also acted for improper motive. Motive for revocation was in- terpersonal diff erences between respondent and specialists who sought to exclude him from cov- erage group. Finding of liability on part of board was not to be disturbed as tort of misfeasance in public offi ce was made out. Trial judge was entitled to assess damages based partly on fi nding that from 1989 to 1996 respon- dent's previously lucrative prac- tice was reduced and limited to walk-in clinics. Rosenhek v. Windsor Regional Hospital (Jan. 18, 2010, Ont. C.A., Doherty, Moldaver and April web specials March 29, 2010 • Law TiMes COURT DECISIONS CaseLaw is a weekly summary of notable civil and criminal court decisions by the Supreme Court of Canada, the Federal Court of Canada and all Ontario courts. CaseLaw is a weekly summary of notable unreported civil and criminal court decisions by the Supreme Court of Canada, the Federal Court of Canada and all Ontario courts. Single or multiple copies of the full text of any case digested in this issue can be obtained by: Epstein JJ.A., File No. C47611) 184 A.C.W.S. (3d) 581 (19 pp.). Building Liens TRUST Trust created by s. 7(3) of Construction Lien Act (Ont.) applies to substantially completed contracts Motions for declarations that construction contracts with P Ltd. had been substantially per- formed and that moving parties were benefi ciaries of trusts cre- ated under s. 7(3) of Construc- tion Lien Act (Ont.), over mon- ey held by Receiver of P Ltd.. Motions granted. Nothing lim- iting time for motion to court to declare contract substantially complete. Contract outstand- ing if any amount remains un- paid. Section 7(3) trust applies to completed contracts as well as substantially completed con- tracts. Owner or trustee cannot avoid s. 7(3) trust by refusing to certify substantial comple- tion. Contractor must be free to apply to court for declaration whether lien rights expired or not. Section 7(3) trust arises on agreement or court declaration of substantial completion. Sale had not yet been completed. Claim for trust interest not too late. Royal Bank of Canada v. Penex Metropolis Ltd. (Jan. 29, 2010, Ont. S.C.J. (Comm. List), Cameron J., File No. CV-09- 8157-00CL) 184 A.C.W.S. (3d) 602 (4 pp.). Mental Health INCOMPETENT PERSONS Appellant was entitled to appointment of amicus curiae After sustaining brain injury in ainmaker_LT_June2_08.indd 1 5/28/08 10:43:29 AM These cases may be found online in BestCase and other electronic resources from Canada Law Book. To subscribe, please call 1-800-565-6967. i) completing and mailing in the order form in this issue; or ii) calling CaseLaw's photocopy department at (905) 841-6472 in Toronto, (800) 263-3269 in Ontario and Quebec, or (800) 263-2037 in other provinces; or iii) faxing a copy of the completed order form to (905) 841-5085. motor vehicle accident appel- lant was declared by physician to be incapable of managing aff airs. Respondent as capacity assessor made same fi nding. As result public guardian and trust- ee became statutory guardian of appellant's property. Appellant sought review of fi nding of re- spondent by consent and capac- ity board. Board confi rmed fi nd- ing. Appellant appealed decision of board. On appeal matter of appointment and remuneration of amicus curiae for appellant was raised. Attorney General ar- gued lack of authority on part of court to appoint amicus curiae and fi x remuneration of person appointed to act as such. Judge found amicus was required to be appointed. Appellant was en- titled to legal representation in order to have meaningful right of appeal. Authority to appoint was founded on court's inherent jurisdiction, especially parens patriae jurisdiction, to protect those who cannot take care of themselves including mentally incapable. Same inherent ju- risdiction gave court authority to fi x remuneration of amicus. Judge appointed S. as amicus in view of considerable experience in representing persons found incapable on appeals from board. Rate of remuneration of S. fi xed at $192 per hour after taking into consideration factors including importance of assignment, legal complexity of work and skill and experience of S. Judge opted not to issue direct order to Attorney General to pay rate in hope of voluntary arrangement between latter and S. on payment of fees of S. as amicus. In absence of ar- rangement fi nding of incapacity made by respondent was to be stayed and public guardian and trustee was to turn over to appel- lant control over assets. Bon Hillier v. Milojevic (Jan. 18, 2010, Ont. S.C.J., Brown J., File No. 03-086/09) 184 A.C.W.S. (3d) 688 (15 pp.). Contracts INTERPRETATION Trial judge erred in awarding damages for breach of exclusive selling agreement Respondent claimed damages for breach of exclusive selling agree- ment whereby appellant had given respondent exclusive right to negotiate sale of appellant's business. Respondent procured letter of intent from prospective purchaser, but appellant, as was its right, did not agree to pro- posed terms. Prior to expiry of period prescribed in agreement, appellant decided it did not wish to sell business and withdrew it from sale. Trial judge erred in awarded damages for breach of contract based on percentage formula for "Transaction Fee", arriving at $350,000. Respon- dent's only entitlement to com- pensation under agreement was limited by terms providing for payment of "Transaction Fee" which was premised on "fi nal selling price" against which fee could be measured. As essential condition was not satisfi ed, there was no fee owing and no damag- es were suff ered by respondent. Action dismissed. Corbana Holdings Inc. v. RP Graphics Group Ltd. (Jan. 15, 2010, Ont. C.A., Sharpe, Blair JJ.A. and Pardu J. (ad hoc), File No. C49805) Decision at 173 A.C.W.S. (3d) 122 was reversed. 184 A.C.W.S. (3d) 675 (4 pp.). Professions BARRISTERS AND SOLICITORS Counsel breached rule prohibit- Annotated Guide to the Canadian Environmental Protection Act Environmental Offences: Corporate Responsibility and Executive Liability The Prosecution and Defence of Environmental Offences Ontario Environmental Protection Act Annotated For a 30-day, no-risk evaluation call: 1.800.565.6967 CA082 CA082 (LT 1-4x5).indd 1 www.lawtimesnews.com Canada Law Book is a Division of The Cartwright Group Ltd. Prices subject to change without notice, to applicable taxes and shipping & handling. 3/24/10 11:33:19 AM Dianne S axe Sentencing Database prepared by: Jonathan Myers and Stanley D. Berger Stanley D. Berger Dianne S axe Joseph Castrilli

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