Law Times

Law Times • June 25, 2018 Page 15 www.lawtimesnews.com beneficial interest or leasehold interest. K brought application against estate and B, deceased's son from prior relationship ("respondents"), to enforce her property interests. Application judge found that balance of con- venience favoured K continuing to operate farming business on interim basis, and restrained B from removing livestock, poul- try, and livestock trailer from farm. Parties made submis- sions on costs. No order as to costs. It was not appropriate in circumstances to take into ac- count alleged disposal of farm animals by respondents. While substantial indemnity costs may be awarded where there has been reprehensible, scandalous, or outrageous conduct by one of parties, conduct attracting such award is usually due to conduct of proceeding itself. If respon- dents committed conversion of applicants' property or another wrongful act, applicants had remedy in claim for damages. It would be unfair to punish respondents in costs without affording them opportunity to fully respond to allegations. Success on applicants' motion for interim injunction was di- vided relatively equally with respect to time spent. Parties ordered to bear their own costs of motion. HARRINGTON et al v. LANE et al (2018), 2018 Car- swellOnt 8430, 2018 ONSC 3280, D.A. Broad J. (Ont. S.C.J.); additional reasons (2018), 2018 CarswellOnt 5011, 2018 ONSC 2059, D.A. Broad J. (Ont. S.C.J.). COSTS Scale and quantum of costs Work undertaken for unsuccessful summary judgment motions was used for short trial Property owner hired con- tractor to perform restoration work. Contractor brought ac- tion against owner for payment for extras. Owner brought third party claim for contribution and indemnity against engineering firm he had hired. Action was allowed and third party claim was dismissed. Owner agreed to pay third party its costs of $26,729.47. Contractor sought costs of action from owner in amount of $74,331.58, inclusive. Contractor awarded costs of $60,291.35, inclusive. Pursuant to R. 49.10(1) of Rules of Civil Procedure, contractor was en- titled to partial indemnity scale to date of its offer to settle, and on substantial indemnity scale thereafter. Although action involved claim of $109,451.35, facts were somewhat detailed and number of procedural steps were required. Action was vig- orously defended. Motions for summary judgment were un- successful, but work that was undertaken for those motions was used for short trial. Hourly rate charged for contractor's senior counsel was too high given nature of claim, and fees claimed were reduced to ref lect more suitable partial indemnity rates for case. Amount of time expended for case was not ex- cessive. Counsel fees were fixed in total amount of $48,835, plus HST of $6,348.55. Disburse- ments were fixed at $4,520.18, plus HST of $587.62. Costs payable by owner to contractor were fixed in total amount of $60,291.35, inclusive of fees, dis- bursements, and HST. Conterra Restoration Ltd. v. Irving Moishe Kirsch (2017), 2017 CarswellOnt 13340, 2017 ONSC 5114, Cavanagh J. (Ont. S.C.J.); additional reasons (2017), 2017 CarswellOnt 7707, 2017 ONSC 3152, P.J. Cavanagh J. (Ont. S.C.J.). DISCOVERY Examination for discovery Party could not re-litigate nature of claim including circumstances surrounding fire Fire broke out in premises rented by IH from brother EH. IH had valid policy of tenant's insurance with insurer E Co. EH commenced action against IH for damages for negligence. IH consented to judgment in amount of $167,393.67 plus in- terest and costs. EH's insurer paid damages. EH commenced action against insurer E Co. al- leging accident was covered under tenant's policy of insur- ance. E Co. denied coverage based on exclusion related to use, operation or ownership of automobile. E Co.'s motion for further and better affidavit of documents was dismissed on grounds that it was too late for E Co. to seek information about fire. EH filed motion for sum- mary judgment. E Co. brought motion to examine EH and IH for discovery. Motion dis- missed. EH had no evidence to provide related to use, operation or ownership exclusion. IH had relevant evidence to offer but it was not open to E Co. to contest findings of liability or damages upon which earlier judgment was based. E Co. could not re- litigate nature of claim includ- ing circumstances surrounding fire. E Co. was not entitled to examine EH or IH. Horsefield v. Economical Mutual Insurance Co. (2017), 2017 CarswellOnt 4806, 2017 ONSC 2080, M.D. Faieta J. (Ont. S.C.J.). SUMMARY JUDGMENT Requirement to show no triable issue Dispute remained as to whether there were any breaches of obligations by insurer under policy Action arose from fire loss which occurred during over- night hours in commercial rental property of which mov- ing party, insured, was land- lord. Insured sought to enforce indemnity under commercial property insurance policy is- sued to it by insurance company or insurer. Coverage was not in issue. Insurer, however, con- tested amount paid for cleanup and had paid out $420,704.55 including loss of rental income in amount of $36,000. Insured brought motion for summary judgment. Motion dismissed. There was genuine issues re- quiring trial which could not be determined on evidence be- fore Court. There was signifi- cant amount of confusion and miscommunication on part of both parties as regards to use of Servicemaster, or who preferred service provider for insurer was. There was clearly misunder- standing and lack of communi- cation on parts of both parties. While insured was referring to Servicemaster Toronto, insurer was referring to Servicemaster Newmarket. There remained significant dispute as regards whether there was breach of policy provisions on part of insured by failing or refus- ing to provide access to agent of insurer to inspect property for purposes of control report, whether anyone from insured realized that Servicemaster that they retained and Servicemaster that attended insured's prem- ises were different entities, or whether there was error on part of Servicemaster as regards rea- sons for attendance at property as maintained by insured. There remained dispute as to whether there were any breaches of its obligation under policy on part of insurer. 2129152 Ontario Inc. v. Aviva Insurance Company of Canada (2017), 2017 Carswel- lOnt 13034, 2017 ONSC 4713, Carole J. Brown J. (Ont. S.C.J.). Construction Law CONTRACTS Building contracts Apparent contradiction was product of motion judge's error in mixing up evidence of parties Plaintiffs (client) entered into construction management con- tract with defendants (contrac- tor) for which contractor agreed to manage construction of im- provements at client's new law office. Following completion of work, client commenced ac- tion to recover alleged overpay- ment of $9,322.29 and for dam- ages pursuant to penalty clause for construction delays. Client moved for summary judgment however motion and action were dismissed. Contractor provided account reconcilia- tion that set out extra work re- quested that largely accounted for discrepancy and after extra work was taken into account, there remained only small overpayment of $677.7. Client however, claimed full $9,322.29 on basis that items referenced in reconciliation were not ex- tras, as they had been included in original contract and fur- ther argued that he had not ap- proved any extras in writing, as required by contract. Mo- tion judge rejected overpay- ment submission finding client had requested work, received exactly what he asked for and paid for what he received. Also, motion judge did not accept penalty clause applied to work that was not intended to be done by completion date and fact that there was delay in in- stallation of feature wall was immaterial. Client appealed. Appeal allowed. Motion judge erred in his assessment of cli- ent's evidence, by finding there was no overpayment and that penalty clause for delay did not apply to construction of feature wall. Motion judge stated there were several examples of over- reaching in client's affidavit but listed only one that he said was most glaring even though cli- ent claimed it was contractor's principal who drafted penalty clause, he later contradicted himself on cross-examination by stating he amended penalty clause after discussion with principal. However, apparent contradiction was product of motion judge's error in mixing up client and contractor's prin- cipal's evidence on cross-exam- ination. Motion judge faulted client for not disclosing fifth in- voice from contractor which he thought to be material to ques- tion of whether contractor had been paid in excess of amount it had invoiced. However, con- tractor conceded that there was no fifth invoice and motion judge erred not only in find- ing there was, but in drawing adverse inference against client for not producing it. Motion judge's strong, but unsupported findings against client's cred- ibility inf luenced his assess- ment of all issues before him and were supported by motion judge's inexplicable outright dismissal of client's overpay- ment claim, despite contractor's concession that there had been small overpayment that was re- coverable by client. 2395446 Ontario Inc. v. King's and Queen's Custom Homes Inc. (2017), 2017 Car- swellOnt 15732, 2017 ONCA 782, Doherty J.A., H.S. LaForme J.A., and B.W. Miller J.A. (Ont. C.A.); reversed (2016), 2016 Car- swellOnt 16354, 2016 ONSC 6537, Sean F. Dunphy J. (Ont. S.C.J.). Evidence DOCUMENTARY EVIDENCE Privilege as to documents Whether settlement privilege applied remained contextual, fact-specific analysis Creditor W Corp. registered general security agreement against debtor's assets to secure its claim for professional ser- vices allegedly rendered. Debt- or's bankruptcy proposal was approved and was performed. W Corp. commenced action against debtor and motion to annul debtor's proposal. Mo- tion judge required debtor and trustee of debtor's proposal to disclose to W Corp. all docu- ments and communications that set out any and all terms of debtor's settlement with credi- tor Z. Debtor appealed. Appeal dismissed. Motion judge erred in stating as general proposi- tion that settlement privilege should not apply to Companies' Creditors Arrangement Act and Bankruptcy and Insolvency Act proposals. Motion judge cited no authority for this blanket statement and it ran contrary to long-standing and well-estab- lished common law principles relating to settlement privilege. Whether or not settlement privilege applied in any given case remained contextual, fact- specific analysis requiring that certain conditions be met. Al- though motion judge may have gone farther regarding scope and applicability of settlement privilege than required to dis- pose of production motion he nevertheless went on to consid- er outcome if settlement privi- lege did apply. Motion judge determined that countervailing interests to public interest in settlement privilege included W Corp.'s allegations of impropri- ety on part of debtor and their potential effect on integrity of proposal process. Emery Silfurtun Inc., Re (2018), 2018 CarswellOnt 8639, 2018 ONCA 485, G.R. Strathy C.J.O., L.B. Roberts J.A., and Da- vid M. Paciocco J.A. (Ont. C.A.); affirmed (2017), 2017 Carswel- lOnt 13270, 2017 ONSC 5768, F.L. Myers J. (Ont. S.C.J. [Com- mercial List]). Family Law SUPPORT Child support under federal and provincial guidelines Given state of record and lack of evidence court could only make consent orders Mother lived in Manitoba and father lived in Ontario. Mother applied to vary child support under Inter-Jurisdictional Sup- port Orders Act, 2002. Appli- cation granted in part. Mother sought to vary order directly under s. 32 of Act instead of first obtaining provisional order. Given state of record and lack of evidence, court could only make consent orders. Insofar as any remaining issue of contested nature was concerned, hearing was required. Final order was made terminating father's obli- gation to pay child support for older child. Temporary order was made for father to pay child support of $1,084 per month for younger child based on income of $126,250 per year plus 70 per- cent of all reasonable special and extraordinary expenses given mother's income of $53,622 per year. Kernstead v. Young (2017), 2017 CarswellOnt 4355, 2017 ONSC 1872, Emery J. (Ont. S.C.J.). CASELAW

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