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Page 14 OctOber 2, 2017 • Law times www.lawtimesnews.com CASELAW taxes. Fee arrangement be- tween registrant and counsel meant that registrant would be responsible for solicitor and cli- ent costs over and above vari- able fixed fee provided that appeal was successful and pro- vided those costs were incurred as supported by dockets and as confirmed by court in process of assessing costs. Irrespective of amount that may be assessed as substantial indemnity costs, registrant's counsel agreed to be bound by that assessment and to invoice registrant ac- cordingly. Fee arrangement was not intended to alter registrant's legal obligation to pay for legal services rendered if appeal was successful, but was intended to ensure that registrant was able to obtain proper legal repre- sentation and was structured to limit registrant's exposure to legal costs if appeal were ul- timately dismissed. Offer of settlement was both thorough and comprehensive. Solicitor and client costs were assessed at $112,500 resulting in substan- tial indemnity costs of $90,000, plus Tariff B costs and disburse- ments including additional $3,500 for preparation of costs submissions. Ike Enterprises Inc. v. The Queen (2017), 2017 CarswellNat 4238, 2017 TCC 160, Guy Smith J. (T.C.C. [General Procedure]); additional reasons (2017), 2017 CarswellNat 1405, 2017 TCC 59, Guy R. Smith J. (T.C.C. [General Procedure]). GOODS AND SERVICES TAX Rebates Applicant signing purchase/ sale agreement not making her purchaser because she signed as agent Applicant's sister and ex-broth- er-in-law asked her, as only relative in area, to find house for niece heading to Toronto for university. Applicant found property and initiated pur- chase, signing purchase/sale agreement and paying deposit from funds provided by them. Applicant was purchaser on title because of unavailability of identification confirming ex- brother-in-law's full name while he was in China and developer's policy did not allow removal of her name when his name was added by amendment. Ex- brother-in-law entered into mortgage and took title solely in his name. Applicant signed rebate application prepared by developer in her name, leading to developer receiving HST re- bate. At closing, ex-brother-in- law was credited by developer with rebate. Ex-brother-in-law appointed applicant as his at- torney to act for him in all mat- ters relating to sale or manage- ment of property. When niece moved back home, applicant on ex-brother-in-law's instructions caused property to be put up to sale with proceeds were paid to him. Minister reassessed ap- plicant under Excise Tax Act, denying rebate that she applied for. Applicant appealed. Ap- peal allowed. Fact that applicant signed purchase/sale agreement did not make her purchaser as she signed as agent for ex-broth- er-in-law. Applicant had no pe- cuniary interest in property and was only acting on directions of and for benefit of relatives to arrange accommodation for niece. There was implied agen- cy relationship. Applicant was agent for principal brother-in- law who obtained benefit of re- bate and he was "particular in- dividual" per s. 254(2)(b) of Act with qualifying relation of niece who had intention to and did use property as primary place of residence. Rebate, applied for by applicant in capacity as agent for ex-brother-in-law, should be allowed to him. Zheng v. The Queen (2017), 2017 CarswellNat 3443, 2017 TCC 132, B. Russell J. (T.C.C. [Informal Procedure]). Ontario Civil Cases Administrative Law PRACTICE AND PROCEDURE On application for certiorari Merits of rent subsidy application not warranting its continuation Applicant had received rent subsidy for several years when Housing Connections Review Panel decided to cancel his sub- sidy. Applicant's application for judicial review was settled on basis that new decision letter would be issued, which required various documents from him immediately and on ongoing basis. Applicant did not con- tinue to provide required fi- nancial and immigration docu- ments and his rent subsidy was terminated. Applicant fell into arrears and was evicted. Appli- cant applied to set aside deci- sions of Housing Connections. Applicant took no steps to per- fect his application and it was dismissed. Applicant brought motion to set aside dismissal. Motion dismissed. Applicant's failure to retain lawyer was not reasonable in circumstances of this case. Applicant provided no corroboration of his statement that he was without fixed ad- dress. Applicant's claim that he had mental health issues caused by termination of his rent sub- sidy was not supported by evi- dence of prescriptions predating subsidy termination decision. Applicant's explanations for de- lay were not satisfactory. Appli- cant had no occupied rent subsi- dy unit for almost two years and had not occupied unit in build- ing for more than 18 months. With extraordinary lapse of time since termination decision was made, it was unlikely that Housing Connections would be directed to reinstate his subsidy and most that would be accom- plished was that he would start from scratch in applying for rent subsidy. Merits of application and justice of case did not war- rant its continuation. Mungeni v. Housing Connec- tions (2017), 2017 CarswellOnt 3437, 2017 ONSC 1517, Kiteley J. (Ont. Div. Ct.). Bankruptcy and Insolvency COMPANIES' CREDITORS ARRANGEMENT ACT Arrangements Prohibition against directors communicating with auditor not binding On November 24, 2014, plain- tiff C Inc. commenced litigation against multiple defendants, in- cluding its former auditor, LLP, as well as C Inc.'s former direc- tors and officers. C Inc. alleged that K LLP committed auditor's negligence concerning prepara- tion of its financial statements for 2011 through 2013. In 2015, C Inc. negotiated global settle- ment to resolve 22 pieces of liti- gation brought by and against it, including resolution of C Inc.'s claim against its former directors and officers. As debt- or under Companies' Creditors Arrangement Act ("CCAA"), C Inc. required approval of court to enter into global settlement. Global settlement was center- piece of C Inc.'s plan of compro- mise and arrangement under CCAA. C Inc. required approv- al of its plan of compromise and arrangement by both its credi- tors and court under statute. Former directors' contractual obligation to refuse to speak to K LLP was contained in side letter agreement that was part of global settlement of litigation that was centerpiece of plan of compromise and arrangement of C Inc. under Companies' Creditors Arrangement Act ("CCAA"). C Inc. did not dis- close side letter agreement to K LLP, creditors, or to court in CCAA plan approval process. K LLP brought motion for or- der relieving former members of board of directors of C Inc. (or its predecessor) of their con- tractual obligation to refuse to "cooperate with, meet with or talk to" K LLP concerning this litigation except under compul- sion of court order or summons to witness. Motion granted. Prohibition against communi- cating with K LLLP contained in undisclosed side letter agree- ment was not binding on for- mer directors of C Inc.. C Inc. required approval of court to enter into side letter agreement. As it did not disclose side let- ter agreement to its creditors, K LLP, or to court, C Inc. thereby failed to obtain required court approval to agree to side let- ter agreement. As such, C Inc. lacked authority to enter into impugned term in side letter agreement and could not rely upon it. Disclosure to interested parties and to court of terms for which approval is sought or mandated is minimum require- ment. CCAA debtors are super- vised by court under watchful eyes of their creditors and other interested parties. Transpar- ency is part of quid pro quo that comes with enjoying protec- tions of CCAA. 1511419 Ontario Inc. v. KPMG LLP (2017), 2017 Car- swellOnt 5770, 2017 ONSC 2472, F.L. Myers J. (Ont. S.C.J. [Commercial List]). City's motion for payment of debtor's outstanding post-filing property tax dismissed Debtor company became and insolvent and stopped paying taxes to city in 2014. Initial Or- der under Companies' Credi- tors Arrangement Act (CCAA) provided that debtor was to pay post-filing realty taxes but debt- or did not do so. In 2016 city brought motion to have debtor pay all post-filing property tax- es since Initial Order. Debtor brought motion for relief from obligation to pay post-filing tax- es during CCAA process. City's motion was dismissed; debtor's motion was granted. Cash f low forecast indicated $22 million would be available from May to June 2017. City brought mo- tion for payment of debtor's out- standing post-filing property tax obligations and all future post-filing property tax obli- gations. Motion dismissed, on statement of debtor that it would pay $350,000 per month going forward for city taxes. $350,000 per month was about half of debtor's liability under current assessment for 2016, which was under appeal. In balancing of interests of stakeholders, pros- pect of possible reduction of municipal taxes was taken into account. It was not appropriate for post-filing back taxes to be paid yet. There were too many uncertainties to say that $22 million in cash f low from May to June 2017 was available for that purpose. Essar Steel Algoma Inc. Re (2017), 2017 CarswellOnt 7800, 2017 ONSC 3031, Newbould J. (Ont. S.C.J. [Commercial List]). Civil Practice and Procedure CLASS AND REPRESENTATIVE PROCEEDINGS Representative or class proceedings under class proceedings legislation Fact plaintiff previously articled with law firm currently representing her not sufficient to disqualify her Developer constructed multi- building residential condo- minium development. Specifi- cations for standard unit were identical and included forced air heating/cooling system. Pur- chaser of one unit had signed agreement of purchase and sale before developer added clause relating to renting heating sys- tems, and all heating systems provided were rentals. Devel- oper had not provided storage locker units that were includ- ed in purchase price of many units. Purchaser brought action against developer for relief for breach of statutory duties, neg- ligent and fraudulent misrep- resentation, breach of contract, failure to act in good faith, and unjust enrichment. Purchaser brought motion for certifica- tion of action as class proceed- ing. Motion granted. Purchaser was appropriate representative plaintiff. Fact that purchaser had previously articled with law firm currently representing her was not sufficient reason for disqualifying her as represen- tative plaintiff. Purchaser now worked for federal government and had no connection to law firm. Purchaser did not have interest in conf lict with other class members, and there was no evidence that she would not fairly and adequately represent interests of class. Law firm did not have any conf lict of interest with class members at this time, and legal advice received by class members prior to closing was not relevant to determina- tion of common issues. Heyde v. Theberge Develop- ments Ltd. (2017), 2017 Carswel- lOnt 3790, 2017 ONSC 1574, Robert Smith J. (Ont. S.C.J.). PRACTICE ON APPEAL Leave to appeal Consent and Capacity Board's decision confirming finding of incapacity to consent to treatment upheld Patient, in psychiatric facil- ity involuntarily, appealed from Consent and Capacity Board's decision confirming finding of incapacity to consent to treat- ment and upholding her invol- untary status. Treating psychia- trist formed view that patient's medication should be changed. Supervising psychiatrist's mo- tion for order authorizing change in treatment pending appeal was granted. Patient brought motion for leave to ap- peal. Motion dismissed. Mo- tion judge was well aware of decision that patient claimed was conf licting decision, but merely reached different result in respect of particular facts. As motion judge noted, test did not require treating psychiatrist to recite particular phrase so long as evidence supported conclu- sion that patient's condition was likely to improve substantially with new medication. Motion judge's reasons contained de- tailed analysis of evidence and provided basis for conclusions on each element of test. There was no basis for finding that there was good reason to doubt correctness of decision. Having declined to accelerate hearing of underlying appeal, patient did not establish that medication change order involved matters fo such importance that leave should be granted. Elder v. Klukach (2017), 2017 CarswellOnt 3795, 2017 ONSC 1473, Kiteley J. (Ont. S.C.J.); leave to appeal refused (2017), 2017 CarswellOnt 1570, 2017 ONSC 677, Jasmine T. Akbarali J. (Ont. S.C.J.).

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