Law Times

Page 14 September 26, 2016 • Law timeS www.lawtimesnews.com CASELAW limited exceptions. Taxpayer's employment was not strong connecting factor for bonuses. It was not abusive to move com- pany's office to reserve. Office was substantial and Minister's argument in this regard at- tempted to read business pur- pose test into Act exemption. Bell v. R. (July 27, 2016, T.C.C. [General Procedure], Judith Woods J., 2013-1806(IT) G) 268 A.C.W.S. (3d) 701. Ontario Civil Cases Building Liens PROCEDURE Motion for declaration that lien expired was denied In September 2013, defendant general contractor retained plaintiff subcontractor to supply labour, materials and equipment for interchange improvements on highway construction proj- ect. Although plaintiff began work in 2013, signed subcon- tract for $9,952.665 plus taxes not returned to it until Decem- ber 2014. Following dispute in regard to work, delays and payment, plaintiff terminated contract in February 2015. On March 20, 2015, plaintiff served claim for lien (dated March 18, 2015) stating it had last sup- plied services and/or materials to project on February 6, 2015. Parties agreed, however, plain- tiff had not physically been on site of project since prior to winter shut-down scheduled for December 19, 2014. Defendant alleged plaintiff had, therefore, failed to preserve its lien within strict 45-day limitation period prescribed by Construction Lien Act (Ont.) and brought mo- tion for declaration lien expired. Plaintiff claimed it had, between December 19, 2014 and Febru- ary 6, 2015, been performing off-site work in preparation for spring start-up of project sched- uled for April 2015 with result lien preserved within time. Mo- tion denied. Scheduled winter shut-down did not put an end to plaintiff 's ongoing obligations under contract. It had been rea- sonable for plaintiff to continue to perform off-site work in order to be ready for spring start-up without delay. It would not make any practical or commercial sense to require all subcontrac- tors to register liens with 45 days of last on-site work or supply in event of any extended shut- down (whether for weather, la- bour dispute, scheduling issues or other reason). On evidence, plaintiff 's off-site preparatory work, including communica- tions with regard to and submis- sion of documentation and shop drawings, and provision of shor- ing system and concrete forms, constituted lienable supply of services or materials within Act with result claim of lien valid. Toronto Zenith Contract- ing Ltd. v. Fermar Paving Ltd. (July 19, 2016, Ont. S.C.J., DiTomaso J., CV-15-495) 268 A.C.W.S. (3d) 724. Conflict of Laws JURISDICTION Factors supported Ontario as more convenient forum Parties married in 2010 and separated in 2014. Parties were parents of young child who lived with mother in Ontario. Father was professional hockey player and, following mar- riage, parties lived in Chicago during hockey season and re- turned to Ontario for summer. Father was traded to Toronto in 2013 and parties moved to Ontario. In 2014 father signed contract with Florida and par- ties purchased home in Florida. Mother claimed she only lived in Florida home for two weeks before returning with child to Ontario in September 2014. Father brought petition in Flor- ida for dissolution of marriage, division of property, shared custody, and determination of support. Mother brought appli- cation in Ontario for divorce, equalization of net family property, custody, and support. Mother brought motion for or- der that Ontario had jurisdic- tion to deal with custody, ac- cess and divorce; father brought cross-motion to dismiss appli- cation on basis that mother had not met 12-month residency re- quirement prior to issuance of her application. Motion grant- ed; cross-motion dismissed. Mother was ordinarily resident in Ontario from July 2013 when father was traded to Toronto. Ontario was where mother had settled routine of her life, and where she regularly, normally or customarily lived. Child was born in Ontario and had lived there all of her life except for two weeks in September 2014. Ontario had jurisdiction to deal with support and property is- sues. Factors supported Ontar- io as more convenient forum for adjudication of claims. Bolland v. Bolland (July 6, 2016, Ont. S.C.J., Hood J., FS-15- 00404715-0000) 268 A.C.W.S. (3d) 815. Contracts INTERPRETATION Application judge erred in finding agreement required unanimous consent Parties entered into limited partnership agreement (LPA) to purchase certain lands for development. Respondent owned two-thirds of partner- ship and applicant owned one third. LPA provided that re- spondent, as majority owner, had control over development and all major decisions. Issues arose between parties about interpretation of LPA and legal effect of document they signed in 2005. Application judge de- clared that 2005 document was enforceable and provided for equal division of lots and that actions taken by partnership under LPA must be approved unanimously by both parties. Appeal by respondent allowed in part. Application judge cor- rectly affirmed that 2005 docu- ment was enforceable, but erred in finding that LPA required unanimous consent. Wording of LPA with respect to future al- location of lots was not entirely clear. Respondent's argument that applicant gave no consid- eration for 2005 document, so that it was not true and en- forceable bargain, was rejected. Under LPA, as clarified by 2005 agreement, partnership would make allocation of lots avail- able at particular time by "ordi- nary resolution." Terms of 2005 document were not fatally un- certain. However, application judge erroneously decided that partnership could not take ac- tion against defaulting partner without unanimous consent. Application judge's interpre- tation of LPA was contrary to both commercial principles and good business sense. While his finding that 2005 document was enforceable was affirmed, appeal was allowed on issue of unanimity. Richcraft Homes Ltd. v. Ur- bandale Corp. (Aug. 11, 2016, Ont. C.A., John Laskin J.A., P. Lauwers J.A., and L.B. Roberts J.A., CA C60910) Decision at 257 A.C.W.S. (3d) 105 was var- ied. 268 A.C.W.S. (3d) 773. Corporations OPPRESSION Court ordered that majority shareholder could purchase minority's interest or sell company Applicant owned 200 shares in company and respondents owned 400. Relationship be- tween parties had broken down and applicant wanted out. Ap- plicant claimed respondents refused to sell property despite agreeing to do so, refused to enter unanimous shareholders' agreement and preferred inter- ests of family to those of compa- ny in respect of lease. Respon- dents claimed applicant had mismanaged matters in lawsuit against him and acted in bad faith. Respondents were con- cerned that, if they purchased applicant's shares, a judgment could then be made against him in the lawsuit and be en- forceable against the shares, or the company could be found liable. Respondents wanted any purchase price held in trust. Application for order requir- ing majority shareholders to purchase applicant's minority interest. Application granted in part. There had clearly been a breakdown of trust and con- fidence, and a remedy was war- ranted. Respondents' concerns respecting lawsuit were under- standable. It was up to respon- dents whether they wanted to purchase applicant's shares or sell company. If they wanted to purchase shares, valuation was ordered. Valuation would not consider lawsuit, but holdback would be determined later. 2066977 Ontario Inc. v. Kalkat (July 7, 2016, Ont. S.C.J., Sproat J., CV-16-908-00) 268 A.C.W.S. (3d) 776. Environmental Law ENFORCEMENT Parties were entitled to indemnification for costs of complying with remediation order In 1979, G Ltd. purchased prop- erty that was known to have buried mercury-contaminated waste that was discharged into nearby river system. Settlement was reached with two First Na- tions in 1985. Province provid- ed G Ltd. and its successors and assigns with indemnity cover- ing essentially any obligation relating to pollution. In 1998, W Ltd. purchased property except for disposal site, though it was legal owner of disposal site for two years pending severance. W Ltd. sold its part of property in 2007. In 2011, Ministry of Environment issued remedia- tion order requiring W Ltd. and G Ltd.'s successor R Inc. to take certain action and make certain payments. W Ltd. commenced action against province for de- termination that it was entitled to be indemnified under in- demnity for costs of complying with remediation order. R Inc. was granted leave to intervene as party. W Ltd. brought motion for summary judgment. Motion granted; action allowed. Both W Ltd. and R Inc. were entitled to be indemnified under indem- nity for costs of complying with remediation order. Province clearly agreed to indemnify G Ltd. for any costs or expenses resulting from any claim or proceeding, including by prov- ince or statutory agency, with respect to discharge or presence of any pollutant on property. Remediation order was claim or proceeding within mean- ing of indemnity. Remediation order was part of proceeding since order was necessary pro- cedural step for ministry to as- sert its statutory rights under Environmental Protection Act (Ont.). Remediation order was also claim since order was legal demand by ministry pursuant to its authority under Act to re- quire monitoring and remedia- tion of disposal site by W Ltd. and R Inc.. Doctrine of fetter- ing discretion did not apply to indemnity since indemnity did not affect province's legislative functions. Further, indemnity had been approved by court, so province could not now engage in collateral attack. Province should be bound by its contracts in same way as private person. R Inc. benefited from indemnity as successor of G Ltd., and W Ltd. was entitled to benefit from indemnity as assignee. Weyerhaeuser Co. v. On- tario (Ministry of the Attorney General) (July 19, 2016, Ont. S.C.J. [Commercial List], Hainey J., CV-15-11032-00CL) 268 A.C.W.S. (3d) 790. Municipal Law MUNICIPAL BOARD Municipality's motion for leave to appeal board decision was granted Ontario Municipal Board (OMB) approved municipality's pro- posed policies contained in its official plan relating to convey- ance of parkland to municipal- ity as condition of land develop- ment but directed municipality to implement cap on its parkland dedication requirements equal to maximum of 25 per cent of land proposed for development. Municipality brought motion for leave to appeal OMB decision. Motion granted. OMB applied cap that imposed limitation on alternative rate based on site area rather than site density, as con- templated by s. 42(3) of Planning Act (Ont.). There was sufficient reason to doubt reasonableness of OMB's statutory interpreta- tion regarding definition of lesser alternative rate to extent that it included alternative rate based otherwise than on site density. Decision represented first time OMB had imposed cap on al- ternative requirement in official plan of municipality in face of opposition from municipality. That issue engaged issue of cor- rect balance between f lexibility that municipal councils sought in their land use planning and transparency and certainty that developers sought. That appeal was of sufficient importance was underscored by fact that four oth- er large, urban municipal govern- ments obtained intervenor status in proceeding and supported po- sition of municipality at hearing of motion. Leave to appeal was granted. Richmond Hill (Town) v. Elginbay Corp. (April 19, 2016, Ont. S.C.J., H.J. Wilton-Siegel J., 59/15) 268 A.C.W.S. (3d) 877. Professions GENERAL Client had no cause of action in negligence against paralegal Client brought action seeking damages claiming that parale- gal failed to seek adjournment of hearing and was negligent in his representation and in his attendance and conduct before landlord and tenant board. Paralegal brought motion for summary judgment to dismiss client's action. Motion granted; action dismissed. Paralegal did not breach duty owed to client in performing his duties in ap- pearing before board. Paralegal did not breach contract by not seeking adjournment because client instructed him not to do so and retainer letter pro- vided that adjournment was first course of action, not only course. Retainer letter stated that paralegal could not guar- antee result. There was no evi- dence that adjournment would have been granted if paralegal had made request. Paralegal attended before board to con- firm that his retainer had been terminated, which he did as professional courtesy and to ensure his reputation was not impugned. There was no con- duct on part of paralegal that negatively inf luenced result of proceeding or caused client to suffer damages. Client had no cause of action in negligence against paralegal.

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