Law Times

Law times • OctOber 27, 2008 R. v. Dubuc (Apr. 21, 2008, Ont. S.C.J., Valin J., File No. CR-06- 68) Order No. 008/224/005 (9 pp.). Income Tax SEARCH AND SEIZURE Nothing prevented auditors from passing to investigators validly obtained information Faraghi v. Bayview Summit De- velopment Ltd. (June 4, 2008, Ont. C.A., Feldman, Lang and Epstein JJ.A., File No. C45697) Order No. 008/157/071 (3 pp.). Family Law Application to exclude evidence seized pursuant to a search war- rant. Accused charged with a variety of offences under the In- come Tax Act (Can.) and Excise Tax Act (Can.) related to tax eva- sion and false statements. There had been an audit by Canada Revenue Agency ("CRA"), after which the auditor referred the file to the investigations section. The CRA investigator investigated and then obtained search war- rants. Application dismissed. The auditor used the powers available to her predominantly to explain the source of bank deposits to de- termine tax liability. At the point that she received an unsatisfac- tory explanation, she ceased hav- ing contact with the accused and referred the file to the investiga- tion section who made their own investigation. There was nothing preventing auditors from passing to investigators files containing validly obtained audit informa- tion. A taxpayer has very little privacy interest in tax records. There was no breach of ss. 7 or 8 of Charter. R. v. Caul (Aug. 5, 2008, Ont. C.J., McKay J., File No. 070478) Order No. 008/227/007 (6 pp.). CIVIL CASES Appeal ONTARIO Appeal challenged verdict of jury which dismissed appel- lant's claim for damages in slip and fall case. Appellant alleged that trial judge erred by fail- ing to discharge jury following certain potentially prejudicial comments that respondent's counsel made during closing ad- dress. Comments by counsel im- pugned credibility of appellant's three independent witnesses. Comments suggested that two of the witnesses had motive not to meet with respondent's coun- sel before trial and that all three would have been expected to re- port any snowy conditions, had they existed, at time of accident. Following appellant's objections to closing, trial judge dismissed motion for order discharging jury and instead gave correcting instruction to jury. Appeal dis- missed. Trial judge made no er- ror in decision to retain jury. Im- mediately following comments, trial judge appropriately dealt with objection by instructing jury in clear terms that witnesses had no obligation to speak with defence counsel and that there was no legal obligation on the witnesses to report the condi- tions. Jury verdict on basis of all the evidence would have been same irrespective of challenged reference. JURY VERDICT Trial judge appropriately dealt with objection in correcting instruction to jury Parties had common law rela- tionship for 12 years and had two children. Mother cared for chil- dren. Mother was not employed. Father paid $5,000 per month in spousal support and $2,186 in child support in accordance with temporary agreement. Par- ties agreed to joint custody. Or- der was made as to custody and access as outlined in parenting plan submitted by mother with one phrase deleted. Father was unjustly enriched during rela- tionship of mother's running of household and providing child care for 3.5 of 12-year relation- ship. Father's net worth was $7 million. Monetary award was appropriate to reasonably rem- edy unjust enrichment. Business was not common enterprise. There was no sufficiently direct and substantial link between mother's child care and house- hold responsibilities and father's business. Mother was awarded lump sum monetary award of $996,500 for unjust enrich- ment. Income of $450,000 per year was imputed to father. Fa- ther was to pay child support of $5,472 per month. Father owed $102,960 in retroactive child support that was to be paid in 30 days. Income of $85,000 was imputed to mother. Father was to pay $3,800 per month in spousal support which was to terminate after seven years. Fa- ther was to pay mother retroac- tive spousal support of $70,000 within 30 days. Vanasse v. Seguin (July 4, 2008, Ont.S.C.J., Blishen J., File No. 05-FL-2389) Order No. 008/205/045 (50 pp.). PROPERTY No direct and substantial link between mother's child care and household responsibilities and father's business Professions BARRISTERS AND SOLICITORS Appellant denied meaningful Appellant was called to Ontario Bar. Subsequent criminal charges against appellant were stayed on grounds of delay. Respondent held disciplinary hearing. Appellant's counsel was refused adjournment. Appellant elected not to partici- pate without counsel. Hearing proceeded in appellant's absence. Appellant was found guilty of pro- fessional misconduct. Next day on short notice to appellant and in appellant's absence, appellant was ordered disbarred effective im- mediately. Appellant was ordered to pay costs of $82,042. Appeal Panel dismissed appeal except for reducing costs award. Appeal was allowed. There was breach of natural justice in proceeding to penalty phase without adequate notice to appellant. Appellant was denied meaningful opportunity to be heard on penalty. Notice was so inadequate it was no notice at all. Panel failed to act judiciously in refusing adjournment. Court opportunity to be heard on penalty for professional misconduct CASELAW refused to interfere with decision by Appeal Panel on delay. Pitt J. dissented on issue of delay and would have ordered stay. Igbinosun v. Law Society of Up- per Canada (July 18, 2008, Ont. Div. Ct., Jennings, Mol- loy JJ. and dissenting - Pitt J., File No. 571/07) Order No. 008/205/040 (18 pp.). Plaintiff retained defendant to represent plaintiff in action. Tri- al took place nine years ago and concerned collapse of business 20 years ago. Plaintiff brought action in negligence against de- fendant. Action was dismissed. Defendant was not negligent. Defendant undertook trial preparation reasonably required. Defendant was not negligent in failing to recommend retainer of expert accounting witness. It was not necessary to retain ex- pert accounting witness. Admis- sion of Deloitte Report was rea- sonable Retainer of expert and filing of expert report would not have made material difference in presentation of case or outcome. Objection to introduction of re- port would have accomplished nothing. There was no evidence plaintiff suffered loss as result of failure to obtain full accounting .Defendant was not negligent in failing to request adjournment. There was no basis on evidence to conclude other witnesses were necessary at trial. Motion for non-suit was dismissed. Di Martino v. Delisio (July 18, 2008, Ont.S.C.J., Strathy J., File No. 02-CV-227628CM 3) Or- der No. 008/205/041 (37 pp.). Defendant not negligent in failing to recommend retainer of expert witness Sale Of Land provisions of Income Tax Act (Can.) Two conveyances of land by in- dividuals were made to family business corporation. Respon- dent determined transfers were subject to land transfer tax. Ap- peals were dismissed. Before conveyance lands were used in operation of active business op- erated by corporation and not individuals. Conveyances were not conveyed to enable trans- feree to continue operation of business. Active business LAND TRANSFER TAX Provisions of Land Transfer Tax Act (Ont.) took precedence over purposes of Land Transfer Tax Act (Ont.) ("LTTA"), did not include leasing of real property. Provisions of LTTA took prece- dence over provisions of Income Tax Act (Can.), when applying LTTA. for 1211825 Ontario Ltd. v. Ontario (Minister of Finance) (July 24, 2008, Ont.S.C.J., Sheppard J., File No. 41953/99; 41954/99) Order No. 008/211/057 (7 pp.). Torts NEGLIGENCE Judgment finding trader liable for damages for fraud and breach of contract upheld on appeal S. was foreign exchange trader with R.. Between 1997 and 2000, S. executed multiple for- eign exchange trades on behalf of certain clients, but never received funds from clients to pay for trades or to cover $5.4 million in www.lawtimesnews.com Attn.:_______________________________Firm: ________________________ Address: ________________________________________________________ City/Prov.: ________________________________Postal Code:______________ Canada Law Book Account # __________________________________________ VISA/MasterCard/AMEX # ____________________________________________ Expiry Date: ___________________ Signature: __________________________ Print Name on Card: ________________________________________________ Rush orders can be called in at: 1.800.263.3269 Fax orders can be sent to: 905.841.5085 *Add 13% PST & GST on all orders losses suffered by R. on trades. R. alleged that S. manipulated R.'s internal controls to ensure that R. would not know that client funds to pay for trades were not forthcoming and that R.'s own funds were being used to cover losses. S. testified that R. man- agement was aware of disputed trades, but chose to allow trades to continue. Trial judge disbe- lieved S. and found him liable for damages for fraud and for breach of contract and dismissed S.'s counterclaim for wrongful dismissal. No basis to interfere with trial judge's findings. Refco Futures (Canada) Ltd. v. Keuroghlian (Aug. 19, 2008, Ont. C.A., Rosenberg, Feld- man and Lang JJ.A., File No. C46082) Appeal from 151 A.C.W.S. (3d) 325; 22 B.L.R. (4th) 97 with supplementary reasons at 152 A.C.W.S. (3d) 797 was dismissed. Order No. 008/234/022 (16 pp.). Wills And Estates WILLS Father did not lack testamentary capacity when he disinherited son Father transferred bulk of assets to father and son jointly. Father left nothing to plaintiff who was other son in will, believing plaintiff took $100,000 from fa- ther. Plaintiff claimed $100,000 was gift. Father did not lack tes- tamentary capacity. Father un- derstood exactly what father was doing when father disinherited plaintiff. Undue influence by son was not established. Presump- tion of resulting trust was rebut- ted with respect in bank account and half interest in property. Plaintiff did not establish right to other half-interest in property PAGE 15 on basis of doctrine of propri- etary estoppel. Respective claims of adjustment for funds spent on property and occupation rent could be set off and cancelled each other out. Plaintiff 's claim for damages arising from son's destruction of documents was dismissed. Counterclaim that plaintiff allegedly misappropri- ated funds was statute-barred because it was brought after ex- piry of limitation period. Tarling v. Tarling (July 29, 2008, Ont.S.C.J., Herman J., File No. 05-33/05) Order No. 008/214/017 (23 pp.). Civil Procedure SEVERANCE Good reason to doubt whether bifurcation principles were properly applied Master refused defendants' mo- tion to bifurcate jury trial rely- ing on appellate authority that there was no jurisdiction to do so. Appeal court judge found that master erred in her interpre- tation of judicial authority. With consent of parties, she consid- ered whether this was case for bi- furcation and concluded that it was. Principles that guide courts in granting or refusing bifurca- tion are of general importance to administration of justice. There is good reason to doubt whether these principles were correctly enunciated and applied in this case to support order for bifur- cation. Leave to appeal granted. Kovach (Litigation Guardian of) v. Kovach (July 24, 2008, Ont. Div. Ct., Lax J., File No. 228/08) Leave to appeal from 167 A.C.W.S. (3d) 281 was grant- ed. 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