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Page 14 OctOber 24, 2016 • Law times www.lawtimesnews.com CASELAW ter separation from children's father. Pursuant to temporary order in October 2012, father obtained access to both children every other weekend, and two overnight visits per week for son and one overnight visit per week for daughter. Pursuant to second temporary order in February 2014, father obtained expanded access to daughter. Final order in September 2014 provided that parties would have joint custody of children, that father would continue to have access largely according to February 2014 or- der, and that parties had consent- ed to roughly equal sharing of children's care. Minister of Na- tional Revenue concluded that taxpayer and father met defini- tion of shared-custody parents of son since January 2013 and of daughter since March 2014, and redetermined taxpayer's returns for 2011 through 2013 on basis that she was only entitled to 50 per cent of Canada Child Tax Benefit and Goods and Services Tax Credit after those dates. Tax- payer appealed. Appeal allowed. Taxpayer and father had been shared-custody parents of both children since March 2014. Both parents fulfilled responsibility for upbringing of children when they resided with them. Prior to March 2014, conf lict between taxpayer and father was such that taxpayer assumed more than her share of responsibility for pick- ing-up children at daycare and that, for weekdays, father's access was only for overnight period and not full 24-hour day. Chil- dren were in care of taxpayer for time periods exceeding 60 per cent up to March 2014, but after that date, taxpayer and father shared parenting responsibilities on equal basis. Rubinov-Liberman v. R. (Aug. 29, 2016, T.C.C. [Infor- mal Procedure], Guy Smith J., 2015-3461(IT)I) 269 A.C.W.S. (3d) 797. Ontario Civil Cases Bankruptcy and Insolvency ADMINISTRATION OF ESTATES Creditor's claims were lienable Creditor provided materials and services pursuant to lawn main- tenance contracts. Creditor filed two construction liens. Creditor filed proof of claim claiming se- cured claim. Monitor provided notice of revision and disallow- ance. Monitor allowed creditor's claim as unsecured pre-filling claim. Creditor delivered dis- pute notice. Parties disputed whether materials and services provided by creditor could be subject of lien under Construc- tion Lien Act (Ont.). Monitor referred creditor's dispute to claims officer. Dispute allowed. Creditor's claims were lienable. Creditor's claim was allowed as secured pre-filling claim. Black soil and mums added to land were improvements by way of alteration and addition to land and fell within definition of improvement in Act. Addition to land that enhanced land by vegetation control was improve- ment by way of alteration and addition to land. Removal of vegetation and dirt was altera- tion and repair to land and sup- ply of gravel and cloth amounted to supply of materials to effect improvement by way of altera- tion to land. Grounds keeping was improvement by way of al- teration and repair of land. U.S. Steel Canada Inc., Re (May. 24, 2016, Ont. S.C.J. [Commercial List], Julian Po- lika Claims O., CV-14-10695- 00CL) 269 A.C.W.S. (3d) 621. COURTS AND PROCEDURE Order requiring attendance at judgment-debtor examination stayed by s. 69.3 of Bankruptcy and Insolvency Act (Can.) Plaintiff obtained money judg- ment against defendant. Defen- dant failed to attend examina- tion in aid of execution. Motion judge issued order compelling defendant to attend to be exam- ined and bring specified docu- ments. Defendant made assign- ment in bankruptcy. Defendant attended examination but did not bring specified documents, instead bringing notice of stay of proceedings. Plaintiff moved for order finding defendant in contempt of order. Motion judge ruled that motion could proceed despite defendant's bankruptcy. Defendant ap- pealed. Appeal allowed. Section 69.3 of Bankruptcy and Insol- vency Act (Can.) imposes stay on proceedings that come into force on bankruptcy. Although contempt proceedings were not claim provable in bankruptcy, that did not end inquiry as to effect of stay in this instance. Order required that defendant attend for his judgment-debtor examination, which was clearly in aid of execution. Such at- tendance was exactly kind of proceeding that s. 69.3 of Act was intended to stay. Permitting contempt process to unfold in present circumstances would offence principle that bankrupt- cy process was intended to be single forum for creditors. Walchuk Estate v. Hough- ton (Aug. 25, 2016, Ont. C.A., K. Feldman J.A., Janet Sim- mons J.A., and P. Lauwers J.A., CA C60317) Decision at 252 A.C.W.S. (3d) 242 was reversed. 269 A.C.W.S. (3d) 616. Corporations SHARES Notional corporate tax rate was appropriate for purposes of share valuation Company owned one-quarter interest in rental property that had apartment building. Share- holders JL, ML and P collec- tively owned one-third of com- pany's shares while their uncle, shareholder K, owned another one-third of company's shares. K wanted to purchase other three-quarter interest in rental property. K notionally acquired shares from JL, ML and P for fi- nancing purposes pursuant to memorandum of understanding (MOU). JL, ML and P were given option of selling their shares to K once rental property transac- tion closed. After transaction closed, K denied owing JL, ML and P anything for their shares. JL, ML and P brought application for order requiring company to pay them outstanding dividends and requiring K to purchase their shares at fair value. Application granted. K was required to pur- chase shares of JL, ML and P in accordance with their expert's valuation after it was adjusted in accordance with judgment. Value of company's interest in rental property was to be adjusted to account for notional disposition costs, which were reduced by 50 per cent since rental property would probably be held indefi- nitely. K was not permitted to de- duct $300,000 as deferred com- pensation since no such obliga- tion had previously been brought to attention of JL, ML and P. De- duction for legal fees was reduced since some legal fees had not been paid and there was no intention to pay them. Notional corporate tax rate of 26.5 per cent was ap- propriate for purposes of share valuation. Actual corporate tax rate of 46.16 per cent was offset by refundable dividend tax pool. No minority discount was al- lowed since MOU called for "fair value" rather than fair market value, and K received benefits of financing for rental property and two-thirds interest in company. Levine v. 1751060 Ontario Inc. (Jun. 29, 2016, Ont. S.C.J. [Commercial List], Swinton J., CV-14-10413-OOCL) 269 A.C.W.S. (3d) 681. Criminal Law INTERCEPTION OF PRIVATE COMMUNICATIONS Police were permitted to share intercepts for purpose of criminal investigation Plaintiff was arrested for drug trafficking and, after year in custody, charges were dropped. Plaintiff brought action against defendant police, alleging negli- gent investigation, assault, mis- feasance of public office, negli- gent misrepresentation, negli- gent supervision, and conversion of property. Action dismissed. Crux of plaintiff 's action was that police had no basis upon which to apply for authorizations permitting interception of his private communications, which measure led to his violent ar- rest, charge, and disappearance of belongings in his apartment after arrest. Plaintiff 's approach, centering on dearth of evidence implicating plaintiff in offences, was misconceived as threshold for naming him as "known" was merely that affiants considered his communications might assist in investigation. Police did not have to demonstrate plaintiff 's direct involvement as his asso- ciation with other named par- ties was what made him valuable target. Affidavit properly set out reasons why affiant believed that intercepting plaintiff 's commu- nications would lead to evidence being produced. Confidential informants provided sufficiently detailed information to pass "compelling" threshold and cor- roboration of such information was strong enough for purposes of Information to Obtain autho- rization (ITO). Error by affiant, in failing to use word "believed" in summary to signify subjec- tive conclusion that plaintiff was unknown black male referred to by informant, was not attempt to mislead given remainder of ITO made clear correct information. There was sufficient basis for first authorization and so evidence obtained as result was properly available for second authoriza- tion obtained in another inves- tigation. It was acceptable for officers to rely on summaries of intercepted communications as proof of plaintiff 's drug dealing activities, without undertaking investigation to establish "law- ful foundation" of summaries as argued by plaintiff. Police were permitted to share intercepts for purpose of criminal investiga- tion. Second authorization was validly issued and evidence ob- tained from intercepts provided police with reasonable and prob- able grounds to arrest plaintiff. Du Carmur v. Cole (Aug. 9, 2016, Ont. S.C.J., S.A.Q. Akhtar J., CV-10-407731) 269 A.C.W.S. (3d) 685. Financial Institutions LIABILITY Bank gave reasonable notice to customer of change to financial relationship Customer's account manager applied to bank to restructure customer's loans. Bank advised customer it would no longer re- ceive temporary line of credit accommodation that it previ- ously received, it did not approve increase in customer's operating line of credit, account was placed with special loans department and account manager was re- placed. Customer claimed there was overarching agreement be- tween parties that loans extend- ed in past would be approved in future, that bank's obligations pursuant to overarching agree- ment and previous practice justi- fied loans customer was seeking and that bank was liable as result of violating agreement. Cus- tomer brought action claiming bank breached its obligation to give reasonable notice of funda- mental change to loan agreement and that conduct amounted to bad faith. Action dismissed. Re- lationship between banker and client was not fiduciary but was contractual and required that both parties must act in good faith. Reasonable notice must be given where lender demanded payment from debtor, but bank's conduct did not amount to de- mand for repayment. Bank gave reasonable notice to customer of change to financial relationship. Bank did not act in bad faith but acted in good faith, consis- tent with its contractual rights and obligations. Parole evidence rule did not apply, as terms of contracts were clear and unam- biguous. Bank acted reasonably, according to terms of contracts, and there was no basis for claim for unjust enrichment. There was no evidence that customer suffered any damages as result of bank's conduct. While bank's ac- tions might have been financially unwise, its conduct was not mali- cious, oppressive or highhanded to warrant punitive damages. Willowbrook Nurseries Inc. v. Royal Bank of Canada (Aug. 11, 2016, Ont. S.C.J., R.D. Reil- ly J., C-1066-10) 269 A.C.W.S. (3d) 738. Mortgages DEFAULT There was no conf lict between Residential Tenancies Act, 2006 (Ont.) and s. 52 of Mortgages Act (Ont.) Bank registered mortgage on condominium in July 2011. Owner defaulted on mortgage in November 2012 and bank commenced mortgage enforce- ment proceedings. After default, owner leased condominium to tenant for five years on favour- able terms. Terms of lease did not cover monthly expenses associ- ated with condominium. Bank's application to terminate tenancy agreement pursuant to s. 52 of Mortgages Act (Ont.) (MA) was dismissed on basis that s. 52 of MA conf licted with Residen- tial Tenancies Act, 2006 (Ont.) (RTA) and was therefore of no effect. Bank appealed. Appeal al- lowed. There was no conf lict be- tween RTA and s. 52 of MA. RTA was concerned with termination of existing tenancies while s. 52 of MA provided mechanism to have tenancy agreement set aside. There was no provision in RTA to set aside tenancy agreement. Setting aside tenancy agreement indicated that tenancy never ex- isted, while terminating tenancy agreement indicated that it was being brought to end. Section 52 of MA and provisions of RTA could be read together harmoni- ously. Tenancy agreement was set aside. Toronto-Dominion Bank v. Hosein (Aug. 16, 2016, Ont. C.A., J.C. MacPherson J.A., Paul Rouleau J.A., and M.L. Benotto J.A., CA C61401) 269 A.C.W.S. (3d) 769. Natural Resources WATER AND WATERCOURSES Municipality was entitled to its costs of application Property owners, D and J, pur- ported to convey portion of prop- erty to D alone. Surveyor deposit- ed reference plan on title to prop- erty, which indicated that water- course intersecting property was navigable. Municipality unsuc- cessfully brought application for declaration that watercourse was not navigable. Municipality ap- pealed. Appeal was allowed and order was set aside. Issues arose concerning costs. Parties agreed that successful party on appeal should receive costs of $8,000, in- clusive of disbursements and rel- evant taxes, and municipality, as

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