Law Times

Law times • SEPTEMBER 8, 2008 cafe business on grounds of corporate negligence after suf- fering personal injuries by way of assault on premises. Plaintiff applied to bring evidence before court that defendant's premises were often site of disturbances thus increasing the forseeabil- ity of his injuries. Plaintiff had been refused right to introduce a block of 14 police records which noted calls made to po- lice from premises in last year on basis that each record should be scrutinized for relevance prior to admission. Plaintiff now sub- mitted five such records for ad- mission. Application dismissed. Records merely noted distur- bances reported from premises of business not the location of disturbances. No transcripts or complete information on in- cidents was available. Hearsay evidence must meet reliable and necessity tests to be admissible. Although further evidence of nature of incidents on prem- ises would be difficult to adduce this did not render the evidence necessary to applicant's claim. Absence of further information to corroborate hearsay evidence and the lack of acceptance of ve- racity of records by defendants made purported evidence unre- liable and as such it failed both reliability and necessity tests and was inadmissible. Wong v. Coffee Time (Apr. 14, 2008, Ont.S.C.J., Moore J., File No. 02-CV-230801CM3) Order No. 008/114/024 (10 pp.). Family Law COSTS Wife brought application for divorce, spousal support, and equalization of net fam- ily property. Husband advanced $50,000 to wife, contributed $2,000 towards business valu- ation, and paid additional $136,000 to wife. Wife received $667,442 from sale of one home while husband kept other home. Wife was awarded interim spou- sal support in amount of $2,000 per month. Parties settled out- standing issues after five days of trial. Wife received $165,000 equalization payment, $80,000 for retroactive spousal support, and $100,000 for future spousal support. Husband's total costs were $238,810.52 while wife's total costs were $233,082.14. Wife was awarded $150,000 for costs, which included all of her counsel fees for trial and about 75% of business valuator's fee. Husband put wife in position of having to retain business valua- tor. Husband never made pretri- al offer recognizing spousal sup- port. Case should not have been complex. Substantial indemnity costs were not warranted. Grossi v. Grossi (Apr. 9, 2008, Ont.S.C.J., Czutrin J., File No. 05-FD-303279 FIS) Order No. 008/105/160 (14 pp.). Wife was awarded $150,000 in costs Parties were parents of behav- iour challenged son, aged eight. Parties had joint custody and child spent alternate weeks with each parents. Relations between parties had deteriorated and CUSTODY Mother given principal decision-making power with full disclosure to father current arrangement could not continue. Mother lived with partner whom father and al- lies had accused of physically abusing the son however this had proven unsubstantiated when investigated. Mother's partner had one child but who lived principally with biological mother. Father lived with part- ner whose two children had be- haviour problems and they lived full-time with her and father of child in question. Father's part- ner had been principal organiz- er of child's medical appoint- ments. Family Court assessor had viewed both households and recommended child be in sole custody of mother due to chaotic nature of father's house- hold. Father's mother opposed either party having custody and sought custody herself since she had been deprived time with her grandson since relations had soured between parties. Both parents had made con- tributions to child and should retain custody however the cur- rent alternate weekly change of day-to-day custody could not be continued. Mother granted day-to-day custody with fa- ther having alternate weekends and special arrangement for holidays and vacations. Mother given principal powers of deci- sion but with full disclosure to father. Grandparents ordered to be used as first resource for third party care-giving. Norris v. Norris (Apr. 17, 2008, Ont.S.C.J., Gunsolus J., File No. 153/00) Order No. 008/112/102 (26 pp.). Fiduciaries Application against former shareholder and corporate offi- cer for breach of fiduciary duty. S. was shareholder and senior client services executive with A. corporation. S. left A. and almost immediately began working for H., direct competitor of A. and signed up T., a major client he had serviced at A.. T. had been account of S. prior to his joining A. and had brought T. as client to A.. Applicants contended that S. had breached fiduciary duty to refrain from exploiting his re- lationship with previous clients for reasonable period of time in order to give A. opportunity to preserve those relationships. A. had not attempted to retain T.'s account on S.'s departure. S.'s position as fiduciary precluded him from attracting or work- ing for A.'s clients for reasonable period of time. However S.'s fi- duciary duty did not extend to preclude him from working for T. after his departure from A.. Nature and scope of fiduciary duty are fact-specific and de- pend on reasonable expectations of parties. On peculiar facts of this case notwithstanding that S.'s continued work on T. was in breach of his contractual obliga- tions parties reasonably expected that T. and S. would leave A. to- gether. It would be inequitable to impose and enforce fiduciary duty when all parties held this expectation and behaved in this manner. Result guided by particular circumstances of this GENERAL Fiduciary duty did not extend to preclude executive from working for client after his departure from corporation CASELAW business relationship and not by mere fact that S. brought T. account to A.. In other circum- stances fiduciary who brought client into business may be pre- cluded from maintaining that client relationship for period of time after departure. Audience Communication Inc. v. Sguassero (Apr. 22, 2008, Ont.S.C.J. Commercial List, Lederman J., File No. 06-CL- 6353) Order No. 008/119/039 (15 pp.). Insurance C. manufactured pickles. L. in- sured C. under "all risks" insur- ance policy. Regional blackout resulted in power outage totally interrupting supply of electricity to C.'s refrigeration and pickle processing equipment for 27 hours. C. sustained substantial spoilage of large quantity of pick- les and cucumbers. L. refused to indemnify for its loss, relying on mechanical breakdown exclusion clause. Motion judge correctly held that C.'s loss was not caused directly or indirectly by "mechan- ical or electrical breakdown or derangement". "Breakdown" and "derangement" referred to inter- nal problem or defect in machine and not to machine's failure to operate due to interruption to its power supply caused by regional blackout. Caneast Foods Ltd. v. Lombard General Insurance Co. of Can- ada (May 9, 2008, Ont. C.A., Rosenberg, Borins and Epstein JJ.A., File No. C47411) Appeal from 158 A.C.W.S. (3d) 647; 86 O.R. (3d) 385; 55 C.C.L.I. (4th) 53 dismissed. Order No. 008/135/042 (10 pp.). PROPERTY INSURANCE Loss not caused directly or indirectly by "mechanical or electrical breakdown or derangement" Landlord And Tenant EVICTION Tenant did not have fair notice of hearing Applicant housing co-opera- tion sought writ of possession of property where respondent lived. Respondent had repeat- edly failed to keep up with hous- ing costs and failed to reduce her arrears despite previous payment schedules having been agreed between parties. Respondent had informed applicant that she was leaving to take care of her mother for three weeks in early September. At beginning of fol- lowing month applicant posted a notice to appear on respon- dent's door to notify of a Board Meeting to discuss her tenancy. Appellant did not receive notice until she returned from abroad which was same day as the hear- ing. Application dismissed. Re- spondent tenant did not have fair notice of hearing concern- ing her. Respondent's notice that she was leaving for three weeks could not be understood to indicate she would certainly return in that timeframe. Even if somebody else picked up the notice it was not necessarily no- tified to respondent. Failure of respondent to make an appeal of decision did not correct the pro- cedural unfairness which made original decision void. Gardenview Co-operative Homes Inc. v. Osei (Apr. 18, 2008, www.lawtimesnews.com Ont.S.C.J., Herman J., File No. 07-CV-344570) Order No. 008/114/065 (4 pp.). Professions Sisters were involved in estate dispute with their uncle follow- ing death of their father. Estate was comprised of real estate port- folio held for most part in part- nership between their father and uncle and known as E.. Sisters retained H. to represent them. Estate issues were ultimately resolved to very considerable fi- nancial advantage of sisters. As part of settlement, E. came under control of father's estate. H.'s ac- count was directed to be paid by E.. Sisters were very concerned about size of H.'s account. Ap- plication judge erred in refusing sister's request to have H.'s legal accounts referred for assessment. Sisters were in reality clients for whom H. provided services. Sis- ters therefore had standing to have accounts assessed. Further, Rules of Professional Conduct of Law Society of Upper Canada required that sisters, as clients, be told whether account contained premium and that they had right to have accounts assessed under Solicitors Act (Ont.). They were told neither. Glanc v. O'Donohue & O'Donohue (May 20, 2008, Ont. C.A., Weil- er, Blair and MacFarland JJ.A., File No. C46462) Appeal from 153 A.C.W.S. (3d) 988 with supplementary reasons at 156 A.C.W.S. (3d) 935 allowed. Or- der No. 008/142/127 (11 pp.). BARRISTERS AND SOLICITORS Judge erred in refusing request to have solicitor's accounts referred for assessment Restitution Claim by plaintiff against defen- dant law firm for damages for unjust enrichment. Plaintiff col- lection agency was hired by de- fendant law firm to collect mon- eys awarded to defendant's client. Plaintiff subsequently obtained cheque from A. which it believed was to pay moneys awarded to defendant's client and issued two cheques to defendant. Defendant deposited cheques in its trust ac- count, issued cheques to client and kept balance which was amount owing for its fees. Plaintiff was subsequently notified by its banker that cheque it had obtained from A. was forgery and amount was with- drawn from plaintiff's account. Plaintiff sought to recover balance held by defendant on basis of un- just enrichment as moneys claimed were held by defendant, there had been corresponding deprivation to plaintiff as its banker had taken by that amount and there was lack of juristic reason for defendant to hold such funds. Plaintiff's claim dismissed. Amount claimed by plaintiff from defendant was not held by defendant without legal basis. Amount represented fees charged by defendant and those fees were properly taken by firm from its trust account in payment. Accordingly third condition for unjust enrichment did not exist and claim by plaintiff failed on that ground. M. McGrath Canada Ltd. v. Vincent Dagenais LLP (Apr. 22, 2008, Ont.S.C.J., Panet J., File No. 07-CV-37075SR) Order No. 008/119/036 (7 pp.). UNJUST ENRICHMENT Law firm had juristic reason for holding funds LT Obtain Copies of Judgments to copies of original decisions Your 24/7 connection caseimage.ca is an online database of both unreported and reported court and tribunal decisions — www.caseimage.ca $12.50* per case CaseLaw on Call • rates Single or multiple copies of the full text of any case digested in this issue can be supplied at the rates shown. Via E-mail Cost per case $17.50* sales@canadalawbook.ca Via Mail Cost per page $0.60* Minimum charge $10* Plus postage Via FAX Via Courier Cost per page $2.50* Minimum charge $10* Cost per page $0.60* Minimum charge $10* Plus courier charges CaseLaw on Call • order form Attention: Photocopy Service: Please send the full text of the following judgments. Orders must provide the case name, case order number (9 digits) and number of pages. 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