Law Times

CaseLawLaw PAGE 14 FEDERAL COURT Prisons Applications by a medium-secu- rity prison inmate for judicial re- view. Applicant served an indefi- nite sentence and was employed in the prison. Search of his cell was carried out while he was at work. Correctional officers found a number of electrical devices and articles in the cell. Items were con- fiscated and were destroyed be- cause of concerns about a bomb threat. Applicant was charged under the Corrections and Con- ditional Release Act (Can.) with possessing unauthorized items and was convicted. He instituted a grievance of this decision. Appli- cant was subsequently instructed to return an electric typewriter he had in possession. He filed a sec- ond grievance when the typewriter was confiscated. Post-search report was never completed regarding the seizure of the typewriter. He instituted a third grievance when the INMATES' RIGHTS Inmate was accorded procedural fairness and final level grievance decisions fell within range of defensible and acceptable outcomes Grievances were denied. Applicant brought four applications for judi- cial review. First was for judicial re- view of the decision to charge him with a disciplinary offence and the respondent's failure to uphold his grievance. Second was for judicial review of the respondent's deci- sion to disallow his full claim for compensation for the destruction of the seized items. Third was for judicial review of the decision to seize the typewriter as contraband and for the ensuing grievance pro- cess. Fourth was for judicial review of the respondent's conduct that denied his grievance regarding the non-completion of the post-search report. Applications dismissed. Applicant's complaints about the seizure of his personal effects and his subsequent treatment in the disciplinary process were partly justified. It was apparent from the institutional responses to his griev- ances that errors were made and that officials did not fully comply with Correctional Service of Cana- da policies and regulations. None- theless, the applicant's complaints were ultimately addressed through the grievance process. Standard of review did not require perfection but reasonableness. Events com- plained of occurred in a correc- tional setting where custodial offi- cials dealt with multiple offenders and the many problems that arose on a daily basis. Mistakes would be made. Applicant was accorded procedural fairness and the final report was not completed. level grievance decisions fell within the range of defensible and accept- able outcomes required by the ap- plicable standard of review. Johnson v. Canada (Attorney Gen- eral) (Dec. 12, 2008, F.C., Mosley J., File No. T-1265-07; T-1315- 07; T-1317-07; T-1318-07) Order No. 009/034/303 (41 pp.). TAX COURT OF CANADA Taxation Appellant owned a numbered company and in 1994 it sold its business and assets to a num- bered company. Purchase prices was $11 million divided into three branches. Appellant also entered into a $1 million three- year employment contract with numbered company. Appellant was paid $200,000 per year and amount of $400,000 in March 1996. Appellant failed to include amount of $400,000 in his 1996 return. Respondent reassessed ap- pellant more than three years after initial assessment and imposed penalties pursuant to s. 163(2) of Income Tax Act (Can.). Appeal allowed. Appellant's omission was not wilful and there was no indifference as to whether or not the law was complied. Appellant relied on his advisors to deal with such issues and wrongly believed that the money had already been accounted for in prior tax years. Circumstances do not justify ap- plication of penalties pursuant to s. 163(2). Gallery v. Canada (Dec. 10, 2008, T.C.C., Jorre J.T.C.C., File No. 2004-759(IT)G) Order No. 008/357/026 (16 pp.). INCOME TAX Omission in tax return did not justify application of penalties ONTARIO CIVIL CASES Building Liens Motion by contractor and prop- erty owner for order dismissing lien action as against them. Con- tractor had hired subcontractor ACMS Ltd. who in turn hired subcontractor AM Ltd.. AM Ltd. registered lien against property and brought action against ACMS Ltd., contractor, and owner for amount owing. AM Ltd. ACTION Lien action dismissed without prejudice to Construction Lien Act (Ont.) claims pleaded quantum meruit and un- just enrichment. Lien was vacated after ACMS Ltd. posted security for full amount of claim. Motion also march 30, 2009 • Law Times COURT DECISIONS ainmaker_LT_June2_08.indd 1 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: 5/28/08 10:43:29 AM 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. granted on terms. Action was dis- missed but without prejudice to AM Ltd.'s claims pursuant to s. 38 of Construction Lien Act (Ont.). Once lien was vacated upon pay- ment of security into court, ac- tion against owner and contractor should have been dismissed. Own- er and contractor were no longer necessary or proper parties as there was no privity between them and AM Ltd.. AM Ltd.'s interest was no longer in property but rather in funds in court. Ablesystems Mechanical Ltd. v. Aer Comfort Mechanical Services Ltd. (Jan. 2, 2009, Ont. S.C.J., van Melle J., File No. CV-08-850-00) Order No. 009/007/032 (6 pp.). Civil Procedure COSTS Developer and municipality suc- cessfully brought application against various homeowners for declaration that use of homes as high-density student lodgings was contrary to by-law and for order restraining unlawful use. Developer's total costs amounted to $865,045.76. Developer was awarded total of $167,923.03 for costs on partial indemnity basis to be divided among various home- owners but municipality was de- nied costs. Case did not amount to public interest litigation as both sides were protecting their pecu- niary interests. On other hand, lack of clarity in by-law practically invited homeowners to conduct themselves as they did. Munici- pality also failed to enforce by-law and essentially condoned student lodgings. Developers' costs were excessive in light of fact that mat- ter could have proceeded as test case. Developers' costs also far ex- ceeded what homeowners could reasonably have been expected to pay. Homeowners were given sig- nificant credit for developer's fail- ure to accept offer that would have reduced amount of preparation required. Neighbourhoods of Windfields Limited Partnership v. Death (Jan. 13, 2009, Ont. S.C.J., Howden J., File No. 49820/07) Order No. 009/014/115 (35 pp.). Costs claimed by successful applicant were excessive Conflict Of Laws Motion by father for order setting aside registration of foreign judg- ments. Mother obtained judg- ments in Poland declaring father to be father of child and ordering father to pay child and spousal support. Mother had judgments registered in Ontario. Motion granted. Nothing indicated father FOREIGN JUDGMENTS Motion for order setting aside registration of foreign judgments was granted www.lawtimesnews.com had any prior notice of proceed- ings in Poland. Nothing indicated what evidence was considered in determining paternity and sup- port issues. No information was provided that would have led to presumption in Ontario that fa- ther was father of child. Interjuris- dictional Support Orders author- ity was directed to request relevant information from mother or from appropriate Polish authority in accordance with s. 21 of Inter- jurisdictional Support Orders Act, 2002 (Ont.). Gal v. Lukasiewcz (Dec. 8, 2008, Ont. C.J., Maresca J., File No. 813/08) Order No. 009/007/021 (5 pp.). Debtor And Creditor Action by wife for declaration that husband was sole beneficial owner of home and for order directing payment into court of net pro- ceeds from sale of home. Wife was awarded judgment against hus- band in acrimonious matrimonial proceedings. Husband arranged for new home to be placed in his brother's and sister's names. Trans- action included trust arrangement that purported to make husband's new partner sole beneficial owner. Action allowed. Husband's broth- er and sister were never intended to be beneficial owners. Husband was clearly settlor of trust arrange- ment, and its purpose was to prevent wife from getting home. Nothing in evidence supported assertion that husband's company had ever been beneficial owner. Husband's conduct before and af- ter completion of transaction was indicative of fraud. Trust arrange- ment was invalid in any event due to failure to prepare proper documentation. As husband's new partner did not come to court with clean hands, she was denied any relief to which she might have otherwise been entitled. Haaksma v. Haaksma (Dec. 5, 2008, Ont. S.C.J., Gray J., File No. 3213/06) Order No. 008/344/116 (24 pp.). FRAUDULENT TRANSACTIONS Arrangement for home to be placed in husband's siblings' names was fraudulent Employment In August 2004, plaintiff learned that a secret camera had been per- sonally installed in the ceiling of her office by her immediate boss. Camera was installed in Novem- ber 2003, purportedly in response to thefts of which the plaintiff was not suspected. The plaintiff sought medical assistance for stress and WRONGFUL DISMISSAL Installation of secret camera in employee's office was violation of privacy and employment contract was prescribed sedative drugs. The plaintiff resigned her employment alleging constructive dismissal. Action allowed. The defendant's installation of a secret camera in a trusted manager's office without her knowledge was unacceptable when coupled with an entirely implausible explanation. The plaintiff's contract of employment included an implied term that she would be treated in good faith and fairly throughout her employment. Defendant's actions violated her privacy and employment contract, and were worse than mere bad faith and unfair dealing. Plain- tiff was not required to continue employment with the defendant to mitigate her damages. No em- ployee is required to continue or return to a working atmosphere of hostility, embarrassment or humili- ation. The plaintiff was employed as a commercial manager for seven years at annual salary of $37,500. The plaintiff was awarded a reason- able notice period of seven months resulting, after mitigation, in dam- ages of $15,279. None of aggravat- ed, punitive or moral damages were awarded given that the manner of the plaintiff's dismissal was not objectionable, and the law related to invasion of privacy continues to develop. Plaintiff's direct boss was not personally liable in damages given that he acted at all times in has capacity as an employee of the defendant. Colwell v. Cornerstone Properties Inc. (Dec. 15, 2008, Ont. S.C.J., Little J., File No. 46035 SR) Or- der No. 008/351/008 (9 pp.). Family Law Motion by father for termina- tion of child support in respect of twin children and repayment of amounts already paid for those children. Father believed he was biological father of mother's twin children. Father and mother ap- parently had third child of their own. Parties separated and father consented to child support for all three children. Father subse- quently learned that he was not biological father of twin children. Motion dismissed. Right to child support was right of children and was independent of conduct of parents. Father was sole father that twin children knew during parties' marriage. Relationship between fa- ther and twin children was natural relationship between parent and children. Existence of this relation- ship was sufficient to require father to continue to contribute towards twin children's material needs. Cornelio v. Cornelio (Dec. 22, 2008, Ont. S.C.J., van Rensburg SUPPORT Payor obligated to continue paying child support notwithstand- ing discovery that he was not biological father of children

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