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Page 14 January 11, 2016 • Law Times www.lawtimesnews.com CASELAW 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. These cases may be found online in BestCase and other electronic resources from carswell.com. To subscribe, please call 1-800-387-5164. FEDERAL COURT OF APPEAL Taxation TOBACCO TAX Dismissal of application for judicial review of surcharge upheld on appeal Store owner was member of First Nations band and lived on reserve where he operated store which sold tax-exempt ciga- rettes. Band imposed surcharge on cigarettes distributed through tobacco retailer agreement with province. Store owner's applica- tion for judicial review of sur- charge was dismissed. Trial judge found Federal Court did not have jurisdiction to consider ap- plication. Trial judge found band was not empowered by any fed- eral legislation, rather, it made decision to allocate quota of tax-exempt cigarettes based on authority provided by Tobacco Tax Act. Trial judge found band's imposition of surcharge was di- rectly related to authority to ad- minister and allocate quota of tax-exempt cigarettes under tax act and retailer agreement. Trial judge found imposition of sur- charge had nothing to do with Indian Act. Decision to impose surcharge was not made by fed- eral board, commission or tribu- nal as contemplated by s. 2(1) of Federal Courts Act. Store owner appealed. Appeal dismissed. No reviewable error in construing relationship between tobacco retailers and First Nation as one governed by private contract, and that as such, First Nation was not acting by or under fed- eral law. Des Roches v. Wasauksing First Nation (Oct. 28, 2015, F.C.A., Dawson J.A., Stratas J.A., and Yves de Montigny J.A., File No. A-573-14) Decision at 247 A.C.W.S. (3d) 724 was affirmed. 259 A.C.W.S. (3d) 593. FEDERAL COURT Human Rights Legislation HUMAN RIGHTS COMMISSION/TRIBUNAL Tribunal had no jurisdiction to consider settlement between parties In 2003, employee filed com- plaint with Canadian Human Rights Commission arguing Ca- nadian International Develop- ment Agency's practices regard- ing employment and harassment in workplace were discrimina- tory and violated s. 7 of Cana- dian Human Rights Act. In 2006, settlement occurred and hearing before tribunal was postponed indefinitely. In early 2007, com- mission sent letter to tribunal in- dicating that terms of settlement had been approved by commis- sion pursuant to s. 48(1) of act. Tribunal then informed par- ties that file was closed. In 2010, commission applied to tribunal to start new mediation process as parties disagreed on interpreta- tion to be given to settlement. In 2012, decision rendered by Fed- eral Court held settlement was deemed to be order of Federal Court. Employee unsuccessfully brought motion before tribunal requesting that file be re-opened. Employee brought application for judicial review. Application dismissed. ere was no juris- diction. Employee wished to re- solve ambiguity in settlement by statutory tribunal which was not party to settlement approved by commission, and was not party to order. Tribunal was statutory creature that had no jurisdiction to consider settlement between parties as administrative tribu- nal had no inherent jurisdiction, taking its existence and jurisdic- tion from act. Rameau c. Canada (Procu- reur général) (Oct. 19, 2015, F.C., Yvan Roy J., File No. T-1992-14) 259 A.C.W.S. (3d) 534. Industrial and Intellectual Property PUBLIC HEALTH Minister implemented import ban motivated by improper purpose Main applicant was largest phar- maceutical manufacturer in Canada and it purchased and imported into Canada active pharmaceutical ingredients and finished dosage form pharma- ceutical products from other applicants, affiliated Indian com- panies. United States Food and Drug Administration inspected Indian applicants' facilities and found they were non-compliant with good manufacturing prac- tices requirements and it issued import alert on all products coming from Indian applicants except for products that were medically necessary. Newspaper began publishing articles and editorials that were critical of Health Canada and respondent Minister of Health. Minister imposed import ban preventing importation of drug products into Canada from Indian appli- cants' manufacturing facilities and it also amended main appli- cant's establishment licences to prohibit import of all products except those deemed medically necessary. Applicants applied for judicial review. Application granted. Minister acted for im- proper purpose and did not act in accordance with duty of pro- cedural fairness when import ban was implemented and estab- lishment licences were amend- ed. ere was no evidence that minister was concerned with immediate health risks posed by products subject to ban or that situation was highly urgent such that level of procedural fair- ness should be less. Regulatory regime and circumstances sug- gested that procedural fairness should have been given prior to import ban being implemented. Minister failed to provide any notice and denied main appli- cant opportunity to be heard before unilaterally imposing import ban. Minister did not act in accordance with natural justice. Applicants had not met burden of proving that minister demonstrated reasonable ap- prehension of bias from lack of independence or impartiality. Minister's actions were ultra vi- res. Minister used proper statu- tory provision to add terms and conditions to main applicant's establishment licences but in circumstances provision should include procedural fairness granted to establishment licence holders throughout rest of regu- latory scheme, which required notice and reasons for addition of terms and conditions. Section 2(e) of Canadian Bill of Rights did not apply in circumstances. As minister implemented im- port ban that was motivated by improper purpose and without providing main applicant with procedural protections required by law, decision was not reason- able or correct and it must be quashed. Minister acted without jurisdiction in releasing state- ments to media and statements were to be retracted. Apotex Inc. v. Canada (Min- ister of Health) (Oct. 14, 2015, F.C., M.D. Manson J., File No. T-2223-14) 259 A.C.W.S. (3d) 580. ONTARIO CIVIL CASES Assessment EXEMPTIONS Rail lands were not exempt from taxation by municipalities Municipality was sole sharehold- er of corporation that owned railway that ran through mu- nicipality and three other mu- nicipalities. Operation of railway was le to operator who paid nominal amount of $1 as rent annually. Various other terms regarding railway were specified in agreements between munici- pality, users' group, and opera- tor. Municipality's rights under one agreement were assigned to corporation. Corporation paid municipal taxes to all four mu- nicipalities for rail line. Corpo- ration brought application for declaration that it was exempt from payment of municipal tax- es pursuant to s. 315(1)1 of Mu- nicipal Act, 2001, and for order that municipal taxes paid be re- funded. Application dismissed. Rail lands owned by corporation were not exempt from taxation by municipalities pursuant to s. 315(1)1 of act. Exemption in s. 315(1)1 of act applied to "land leased by the railway company to another person for rent or other valuable consideration". Collec- tion of agreements did not grant quiet possession of rail lands to users' group. Corporation re- tained rights that owner in pos- session might exercise. Rail lands were therefore not lands "leased" to users' group within meaning of s. 315(1)1 of act. Collection of agreements, when read as whole, created business relationship that most resembled joint venture. Further, users' group did not pay rent or other valuable consid- eration to corporation as those terms were used and intended under s. 315(1)1 of act. Arrange- ments between corporation and users' group were implemented to ensure rail users had benefit of rail line to keep their business operations in municipality. Orangeville Railway Devel- opment Corp. v. Mississauga (City) (Sep. 14, 2015, Ont. S.C.J., Emery J., File No. Orangeville 281/13) 259 A.C.W.S. (3d) 414. Civil Procedure CHANGE OF SOLICITOR Counsel denied permission to withdraw mid-trial Plaintiffs invested in defen- dant. Investment was failure due to failure to conduct due dili- gence and on defendant's misrep- resentation and oppressive con- duct. Plaintiff sought to recover investment from defendant. Pur- suant to engagement defendant undertook to become lawyers of record for plaintiffs in action and to prepare for and conduct trial of action. ere was no sug- gestion of limited retainer in documentation. Plaintiffs failed to pay down retainer indebted- ness. Defendant accepted secu- rity on two properties in amount of $250,000 during course of first stage of trial. Amount owing to defendant net of any unbilled time was just short of $250,000. Plaintiffs' counsel sought per- mission to withdraw mid-trial. Motion dismissed. It was not feasible for plaintiff to properly advance issues in complex com- mercial litigation on his own. It was doubtful plaintiffs could retain alternative representation. Defendant failed to establish there was no or insufficient eq- uity in security given. Permitting counsel to withdraw at this stage of proceedings would not only cause significant prejudice to clients but would bring admin- istration of justice into serious disrepute. Complaints against defendant were well-founded in that its proposed retirement mid-trial on basis of non-pay- ment of legal fees was improper and unprofessional. Todd Family Holdings Inc. v. Gardiner (Oct. 23, 2015, Ont. S.C.J., McIsaac J., File No. Osha- wa CV-11-76324) 259 A.C.W.S. (3d) 423. CONSOLIDATION Action against insurance broker joined with action against driver and police Plaintiff sustained personal in- juries in motor vehicle accident. Plaintiff was proceeding through intersection on green light when motorcycle failed to stop at red light and collided with her. At time of accident, motorcyclist, who was killed on impact, was being pursued by OPP. Plaintiff sued motorcyclist's estate and OPP. Plaintiff was receiving in- come replacement benefits from her own insurer, and income replacement benefits being paid were significantly less than her pre-accident earnings. Plaintiff sued her insurance broker for negligence and breach of con- tract. Insurance broker brought motion for order directing trial of action with another or for trial one aer other. Motion granted. Joinder was warranted. Broker's negligence case had only periph- eral connection to motor vehicle accident, but concern centred on potential for double recovery. It was not clear that relevant provi- sions of Insurance Act applied to impose trust or mandate assign- ment. Plaintiff 's future income loss would be at issue in both proceedings. Edwardson v. F. Filia & As- sociates Ltd. (Oct. 28, 2015, Ont. S.C.J., H.A. Rady J., File No. 2170/13 SR A1) 259 A.C.W.S. (3d) 429. PLEADINGS Motion to strike out insurer's statement of claim alleging fraud and conspiracy was dismissed Claim arose out of alleged insurance fraud scheme by as- sessment centre respecting individuals injured in motor vehicle accidents. Causes of ac- tion advanced were fraud and conspiracy to injure. Statement of claim alleged that individual defendants were responsible for submission of fraudulent treat- ment plans and invoices. Defen- dants brought motion to strike out statement of claim. Motion dismissed. Claim set out specific fraudulent acts attributed to each individual defendant, which was sufficient to plead cause of action in fraud against individual de- fendants. Claim pleaded mate-

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