Law Times

Law Times • January 22, 2018 Page 15 www.lawtimesnews.com CASELAW respondent law firm which pro- vided that firm's legal fees would be equal to 25 per cent of dam- ages recovered on her behalf, plus partial indemnity costs up to 40 per cent of total recovery, plus disbursements. Client received $41,906 of her $150,000 settle- ment, as remainder was allocated to firm as being party-and-party costs, legal fees, and disburse- ments. Agreement and amount charged violated ss. 28.1(8) and 33(1) of Solicitors Act because firm did not obtain judge's ap- proval to include in its fee costs obtained as part of client's settle- ment, and firm charged interest from date disbursements were incurred. Client brought motion to certify class proceeding alleg- ing violation of Act, breach of fiduciary duty, breach of contract and excessive disbursements. Certification judge dismissed motion on basis that common issues and preferable procedures criteria were not satisfied. Cer- tification judge held that there was no free-standing strict li- ability civil wrong for breach of ss. 28.1(8) and 28.1(9) of Act but was satisfied that there was cause of action under ss. 23 and 25 of Act, and for breach of fiduciary duty and breach of contract. Di- visional Court allowed client's appeal and certified 19 common issues but dismissed her motion to amend her notice of applica- tion to add cause of action. Firm appealed certification and cli- ent cross-appealed on issues of amendment and failure to cer- tify two issues. Appeal dismissed and cross-appeal allowed in part. Divisional Court correctly con- cluded that it was not plain and obvious cause of action relying on s. 28.1 of Act cannot suc- ceed. Divisional Court did not err in certifying 18 common is- sues, although one certified issue was not proper common issue. Divisional Court did not err in finding that class proceeding was preferable procedure or that solicitor-client privilege was not basis for refusing certification. Divisional Court erred by dis- missing client's motion to amend her notice of application without focusing on procedural fairness and prejudice, and without ad- vising client that she could bring her motion before case manage- ment judge. Divisional Court erred in not certifying two com- mon issues. Hodge v. Neinstein (2017), 2017 CarswellOnt 9036, 2017 ONCA 494, Alexandra Hoy A.C.J.O., E.E. Gillese J.A., and D.M. Brown J.A. (Ont. C.A.); re- versed (2015), 2015 CarswellOnt 18937, 2015 ONSC 7345, Then J., Molloy J., and Lederer J. (Ont. Div. Ct.). BARRISTERS AND SOLICITORS Negligence Law firm breached contractual and fiduciary duties by accepting retainer During global financial crisis, Canadian automotive manufac- turer G Ltd. sought government financial assistance in order to avoid Companies' Creditors Arrangement Act (CCAA) pro- ceedings. G Ltd. offered wind down agreements (WDAs), to be accepted within six days, to some of its vehicle dealers as part of restructuring plan required to secure government funding. Law firm CBB had been retained by Industry Canada and certain dealers. CBB was then retained by another group of dealers. CBB did not negotiate WDAs on behalf of dealers. Most dealers accepted WDAs offered. Deal- er T Ltd. brought class action against G Ltd. and CBB. Trial judge found there was retainer between CBB and dealers, and CBB breached its contractual and fiduciary duties by accept- ing retainer despite having al- ready agreed to act for Canada in relation to any G Ltd. CCAA proceedings (Canada conf lict). Trial judge awarded aggregate damages based on dealers' loss of chance to collectively negotiate WDAs. CBB appealed damages and liability; T Ltd. cross-ap- pealed damages. Appeal allowed in part; cross-appeal dismissed. Trial judge did not err in find- ing that retainer existed, or that CBB breached its obligations due to Canada conf lict. Trial judge's finding of substantial risk-based conf lict due to Cana- da retainer was firmly anchored in evidence. Trial judge did not err in his loss of chance analysis or in determining causation on class-wide basis, even though it was not certified as common is- sue. Causation inquiry was both available and necessary to de- termine T Ltd.'s claim. While it was open to trial judge to award aggregate damages, trial judge erred in subtracting amount actually paid from amount ap- proved for WDAs by G Ltd.'s American parent. Trial judge should have calculated value of lost chance to negotiate suc- cessfully as difference between money approved for WDAs and money offered. Trillium Motor World Ltd. v. Cassels Brock & Blackwell LLP (2017), 2017 CarswellOnt 10114, 2017 ONCA 544, E.A. Cronk J.A., K. van Rensburg J.A., and G. Pardu J.A. (Ont. C.A.); reversed (2015), 2015 Carswel- lOnt 10246, 2015 ONSC 3824, T. McEwen J. (Ont. S.C.J.). Real Property CONDOMINIUMS Declaration Provisions permitting short-term rental of units not inconsistent with Condominium Act Amendment. Condominium declarations contained deliber- ately inserted provisions permit- ting transient, short-term rental of units. Condominium corpo- rations alleged these provisions were inconsistent with Condo- minium Act, zoning bylaws and restrictive covenant registered on title. There had been no com- plaints about short-term rentals, but condominium corporations wanted to prevent future prob- lems. Sister condominium cor- porations brought application to amend declarations to remove provisions permitting short-term rentals. Application dismissed. Provisions did not grant rights, as right to lease property was right of ownership. Declarations re- stricted use of units, and made it clear that short-term rentals were not restricted use. There was no inconsistency with Condomini- um Act. Condominium boards' inability to make rules on short- term leasing due to provisions in declarations was mandated by s. 58(2) of Condominium Act. Declarations stated that permit- ted uses had to accord with zon- ing bylaws, and if use of unit was inconsistent by bylaws, remedies were available under City of To- ronto Act, 2006. Restrictive cov- enant registered on property restricted commercial construc- tion of ground f loor area. While leasing of units may be commer- cial use, it was not commercial construction. Other aspects of restrictive covenant set out spe- cific details, such as prohibiting clothes lines and umbrellas, so if it was intended to restrict short- term leasing, it would have said so. Provisions were inserted in declaration by developers to pro- tect short-term leasing business model, and there was evidence from owners that they relied on this in choosing to purchase unit. Solution for owners who found provisions undesirable was to amend declaration under s. 107 of Condominium Act. If 80 per cent threshold required under s. 107 was too high, remedy was legisla- tive change. Remedy was not to take amendment sought by con- dominium board and repackage it as inconsistency in order to seek relief under s. 109. TSCC No. 1556 and No. 1600 v. Owners of TSCC No. 1556, et al. (2017), 2017 Car- swellOnt 17193, 2017 ONSC 6542, J.T. Akbarali J. (Ont. S.C.J.). EASEMENTS Particular easements Public right of way established in original purchase and 20-year period afterward Applicant couple were purchas- ers of property, which was part of provincial heritage site. Prop- erty contained access area to public trail, which was heavily trafficked. Original purchaser of property received small part of land from government agency, upon purchase in 1993. Remain- der of property belonged to agen- cy. Original purchaser was given easement over property in form of right of way, to be able to use own vehicles on property. Right of way did not allow purchaser to exclude public pedestrians from property. Original purchaser sold property in 2002, with sub- sequent purchaser using right of way without incident. Subse- quent purchaser sold property to couple in 2012. Couple claimed they had not been made aware of situation with easement and public access to property. Couple claimed that they had right to ex- clude public from their property. Couple brought application for declaratory relief. Couple also claimed that defendant author R had made false statements about right of way, in book. Couple ap- plied for injunctive relief against R. Applications dismissed. Right of way had been established in original purchase, as well as use of property over 20-year period be- fore couple's purchase. Language of deed signed by couple was clear in establishment of public right of way. Pedestrians had not significantly interfered with cou- ple's property use. There was no danger to couple's personal safe- ty. Couple did not properly read or understand key documents. Agency had full rights to invite public onto specified property, as long as there was no interference with easement. Agency was prop- erly acting in public interest. Raimondi v. Ontario Heri- tage Trust (2017), 2017 Carswel- lOnt 9022, 2017 ONSC 3389, Daley R.S.J. (Ont. S.C.J.). LANDLORD AND TENANT Renewal of lease Renewal provision required more than notice of intent to renew lease Parties entered into 20 year ground lease in respect of land on which tenant built and reno- vated McDonald's restaurant, and lease included option to renew for two consecutive ad- ditional ten year terms. Tenant gave proper notice of intention to renew lease, but parties failed to agree on rent by nine months prior to expiration of original term as required by lease. Ten- ant did not revoke notice of in- tention to renew, and it did not elect to proceed to arbitration. Landlord applied for declaration that lease would be terminated on specified date; tenant applied for declaration that lease had been renewed and for order that parties proceed to arbitration to establish fair market rental rate. Landlord's application granted; tenant's application dismissed. Renewal provision of lease re- quired tenant to do more than just provide notice of intention to renew lease twelve months be- fore end of lease term, and ten- ant was required to choose be- tween proceeding to arbitration or revoking intention to renew if parties had not agreed to rental rate nine months before end of original term of lease. Once tenant failed to make election parties were left with agreement that was uncertain as to material term, rental rate. With incom- plete material term, parties did not have enforceable agreement, and lease was unenforceable. By its conduct, landlord demon- strated its intention not to en- force its rights under lease. Lease provided for three month nego- tiation period but because land- lord had not delivered its rent proposal, negotiations had not been able to begin in meaning- ful way, and tenant understood that negotiations should have chance to succeed before parties would incur costs of arbitration. When nine month time period contemplated by lease renewal provision passed landlord did not allege that lease was at end, and landlord waived its right to insist on strict compliance with lease. Landlord then communi- cated clear intention to revert to its original position under lease, tenant understood landlord's in- tention, and from that point ten- ant had reasonable period of time to elect to proceed to arbitration, which it did not do. There was no injustice in landlord return- ing to original position under lease within reasonable time of giving notice of its intention to do so, and doctrine of waiver did not save lease. Precondition for exercise of discretion to relieve from forfeiture was not present, as tenant had not made diligent efforts to comply with terms of lease. Lease had come to end but judgment was stayed for 90 days. North Elgin Centre Inc. v. McDonald's Restaurants of Canada Limited (2017), 2017 CarswellOnt 9354, 2017 ONSC 3306, J.T. Akbarali J. (Ont. S.C.J.). REGISTRATION OF REAL PROPERTY Boundaries and surveys Preferred option was survey consistent with respondent's use of property Applicant couple were owners of land in township, since 2015. Re- spondent individual A was owner of neighbouring property, which had belonged to his father since 1970 before he took ownership in 2014. Dispute arose over bound- ary line of properties, based on prior surveying done. Couple applied for declaration that they were owners of land, as set out in survey favourable to them. Cou- ple also sought relief including removal of retaining wall on what they claimed to be their property. Couple applied for injunction preventing trespassing by A and his family members and guests, until full application was heard. A cross-applied to have his sur- vey declared as proper boundary. In alternative, A claimed that he had acquired disputed portion of property by adverse posses- sion. Application granted in part. Cross-application dismissed. Surveyor relied upon by A erred in not using fence line as bound- ary. Acceptance of fence line was only made by A's surveyors, with other surveys disagreeing. Survey commissioned by couple left two options open as to proper bound- ary. Preferred option was one that was consistent with A's use and occupation of property. A's use approached but did not go right up to fence line. Westerly bound- ary on plan of surveyor was prop- er boundary. Declaration was made accordingly. No damages were awarded at this stage. A was to remove stone wall on couple's property, and would only be per- mitted to enter for that purpose. Weaver v. Anderson (2017), 2017 CarswellOnt 4318, 2017 ONSC 1928, J.A.S. Wilcox J. (Ont. S.C.J.).

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