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Appeal

GROUNDS

Trial counsel failed to follow accused’s instructions that he wanted to testify

Application to introduce fresh evidence and appeal from conviction. Accused convicted of possession of weapon for dangerous purpose and aggravated assault following road rage incident. He was sentenced to 90 days’ incarceration, to be served intermittently, plus three years’ probation. Accused appealed from his convictions on ground of ineffective assistance of counsel. He argued trial counsel failed to follow his instructions that he wanted to testify. Application to introduce fresh evidence granted, appeal allowed and new trial ordered. Record of trial proceedings and fresh evidence filed by accused indicated that despite repeated efforts by both accused and Crown, and direct orders of court, accused’s trial counsel failed to respond to accused’s allegations against him and failed to provide trial brief or any associated documents to accused or Crown. Throughout, accused instructed trial counsel that he wished to testify at trial. Had he been permitted to testify at trial, accused’s testimony would have challenged complainant’s credibility; challenged evidence of alleged eyewitness to assault; sought to corroborate other defence evidence led at trial; and cast some doubt on Crown’s assertion that accused was not acting in self-defence. Accused required assistance of Tagalog interpreter at trial and did not understand some remarks by his trial counsel and trial judge. After accused’s trial, his trial counsel was disbarred by Law Society of Upper Canada based in part on complaints from other clients that he failed to obtain or follow their instructions. In absence of some explanation or response from accused’s trial counsel, accused’s claim that he instructed his counsel that he wished to testify and was prevented from doing stood uncontradicted.
R. v. Eroma (Mar. 28, 2013, Ont. C.A., J. Simmons J.A., E.A. Cronk J.A., and E.E. Gillese J.A., File No. CA C52330) 106 W.C.B. (2d) 684.

Bankruptcy and Insolvency

PETITIONS

Bankruptcy application brought to put wrench in position of husband in litigation

Estranged spouses had operated several businesses together for 25 years. Parties executed separation agreement. Subsequently, husband claimed he noticed some irregularities in amounts being paid to creditors. Husband and companies commenced civil action against wife and others for payment of damages of $3 million and other relief on basis of alleged fraud. Husband also amended his divorce proceedings to claim separation agreement should be set aside and support payments provided for in agreement be set aside retroactively on grounds that wife had assisted in defrauding companies, which was unknown at time of execution of separation agreement. Wife commenced civil action against husband and companies, central issue being who was responsible for fraud on their businesses. Wife brought application for bankruptcy. Principal debt relied on by wife in support of her bankruptcy application was debt arising from separation agreement and family law proceedings. There was evidence that husband had been indebted to other creditors other than the FRO for spousal arrears. None of these were listed in application for bankruptcy order, nor were they subject of evidence in chief from wife. Application dismissed. There was no legitimate purpose in this bankruptcy application. It was not brought with a view to orderly and fair distribution of property of bankrupt among its creditors on pari passu basis. Applicant did not refer to or rely on any creditors other than herself, and no other creditor was served with application. What wife may be owed was subject of dispute in family court proceedings and two civil proceedings. No thought was given to having orderly and fair distribution of property of bankrupt among husband’s creditors. Wife did not bring bankruptcy application in order to have trustee sue her for fraud. Bankruptcy application had been brought for improper purpose of putting wrench in position of husband in litigation who asserted fraud on part of wife. Refusal of wife to assist with independent report was evidence of bad faith on her part in dealing with issue which was central to dispute and raised question as to whether their defence of fraud claim was bona fide defence. Claim of husband against wife was bona fide dispute so far as he was concerned.
Gaal, Re (Mar. 6, 2013, Ont. S.C.J., Newbould J., File No. 31-207823-T) 227 A.C.W.S. (3d) 20.

Arbitration

AWARD

Appeal really about whether arbitrator applied proper contractual legal principles

Application for leave to appeal arbitration award and supplementary award. Section 45(1) of Arbitration Act, 1991 (Ont.), provides that if arbitration agreement did not deal with question of law, party may only appeal on question of law, with leave. Applicant claimed that arbitrator’s errors arose as pure questions of law. Respondent characterized errors as questions of mixed fact and law, for which no appeal was permitted. Application allowed. Leave to appeal granted. Once all necessary factual findings were made, applying law to those facts became question of law. Appeal would really be about whether arbitrator applied proper contractual legal principles to facts as he found them in coming to his decision. Grounds of appeal reflected errors in law.
Zafir Holdings Inc. v. Grassmere Construction Ltd. (Mar. 27, 2013, Ont. S.C.J., Mesbur J., File No. CV-12-469468) 227 A.C.W.S. (3d) 16.

Equity

ESTOPPEL

Nothing prevented minister from favouring one group of fishermen over another

Applicant and those applicants represented were commercial fishermen. Minister changed allocation of total allowance catch (“TAC”) for Pacific Halibut fishery. Minister departed from long-standing commitment to maintain 2003 Framework. Minister reduced applicant’s share of TAC from 88% to 85%. There was corresponding reduction of applicant’s individual transferable quota, affecting applicant’s ability to earn livelihood from fishery. Application for judicial review was dismissed. There was no evidence decision was made in bad faith or pursuant to irrelevant purpose. Remedies for Minister’s change in position were not judicial. There was nothing preventing Minister from favouring one group of fishermen over another. Minister could not be bound by past policy decisions. It was not for court to reweigh factors and come to own conclusion. There was no basis to interfere. Minister was not bound by advice from department and decision not to follow recommendations of Department was not reviewable error. Doctrine of legitimate expectations did not apply. There was no basis on which promissory estoppel could be invoked. Becoming bound to one policy choice would be in violation of Minister’s duty.
Malcolm v. Canada (Minister of Fisheries and Oceans) (Apr. 11, 2013, F.C., Donald J. Rennie J., File No. T-577-12) 227 A.C.W.S. (3d) 255.

Customs and Excise

DECLARATION

Minister reasonably declined to exercise discretion to grant relief from forfeiture

Applicant failed to report on arrival in Canada applicant had currency in excess of $10,000. Applicant was importing currency with value of $21,754. Undeclared currency was seized. Officer suspected currency was proceeds of crime. Manager determined applicant did not ask for interpreter and concluded that language was not contributing factor in applicant’s failure to report currency. Appeals Division determined currency seized under Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Can.), were to be held as forfeited. Applicant argued there was failure of natural justice as interpreter was not provided to applicant when one was requested at port of entry. Applicant argued Minister failed to reasonably exercise discretion with respect to forfeiture. Application for judicial review was dismissed. Applicant had no basis to argue there was breach of procedural fairness. Applicant did not successfully impugn factual finding that applicant made no request for interpreter. Applicant failed to establish link between seized funds and legitimate source of seized funds. Minister reasonably declined to exercise discretion to grant relief from forfeiture given applicant did not provide sufficient evidence to satisfy Minister that seized funds were not proceeds of crime.
Satheesan v. Canada (Minister of Public Safety and Emergency Preparedness) (Apr. 5, 2013, F.C., Cecily Y. Strickland J., File No. T-1405-12) 227 A.C.W.S. (3d) 106.

Breathalyzer

REFUSAL TO PROVIDE SAMPLE

No innocent explanation for inability to provide breath sample

Accused appealed his conviction for refusing to provide breath sample. Accused was driving home after playing golf and attending bar, his car struck two vehicles that were stopped in front of him at red light. Police investigated and charged him with impaired operation, dangerous operation and failing to provide breath sample. He was convicted of only refusal count. Occupants of other two cars testified accused appeared intoxicated. One conceded he could have been in shock. Officer believed accused’s ability to drive was impaired by alcohol because his eyes were bloodshot and glassy, his speech was slow and slurred, he was somewhat unsteady on his feet, and he had surprising odour of alcohol on his breath; accused told officer he had been at tavern where he consumed non-alcoholic beer. Officers at detachment called paramedics out of medical concerns for accused. Accused became combative with paramedics and police. He refused to let paramedics treat him or check his blood sugar. While at hospital accused refused to allow any blood to be drawn. He also refused to provide urine sample when asked after he was finished with breath technician. Officer testified that as soon as breath demand was read, accused started to breathe very rapidly and started to yell that he was in intense pain. He then calmed down; when given opportunity to provide sample, he did not breathe into mouthpiece. Accused gave conflicting version of events to that of officer witness and insisted neck pain impeded his efforts to provide sample. Appeal dismissed. Trial judge found that in examination-in-chief and in cross-examination, accused prevaricated continuously, was argumentative and, on at least one occasion, angry with Crown Counsel. It could not be suggested that record was devoid of any bases upon which trial judge could have reached that conclusion. Court was unable to see where trial judge conflated issues or reversed onus. There was evidence upon which trial judge could have convicted. Even factoring in unusual circumstances of case, court was not persuaded trial judge had to acquit. Trial judge finding that accused’s sudden inability to breathe was inexplicable, did not put onus on accused. Since accused’s evidence was denial that he deliberately quit breathing when given mouthpiece, there was no innocent explanation for inability to breath. Conclusion that there was no explanation was fair comment on record and not reversal of onus.
R. v. Butler (Apr. 30, 2013, Ont. S.C.J., Durno J., File No. Orangeville 46/11) 106 W.C.B. (2d) 491.

Appeal

SENTENCE APPEAL

Sentence imposed entirely fit after largest GHB seizure in Canadian history

Accused applied for leave to appeal sentence of five years’ imprisonment, after one year’ credit for pre-trial custody and stringent conditions of pre-trial release, imposed after he was convicted of conspiracy to traffic in 4-Hydroxybutanoic acid (“GHB”). Accused submitted that trial judge erred by treating as aggravating factor on sentencing fact that GHB is commonly used to put into drinks of unsuspecting third parties, mainly women, so as to render them unable to effectively resist others who seek to take sexual advantage of them. Leave to appeal granted; appeal dismissed. In facilitating payment for GHB, accused was willing participant in conspiracy to utilize GHB in whatever manner might follow, including its potential use as date-rape drug. Quantity of GHB seized was enormous: approximately 600 litres; at time of trial, it was largest GHB seizure in Canadian history. Trial judge made no error in his sentencing analysis and sentence imposed was entirely fit.
R. v. Sansalone (Apr. 10, 2013, Ont. C.A., Janet Simmons J.A., E.A. Cronk J.A., and E.E. Gillese J.A., File No. CA C54341) 106 W.C.B. (2d) 483.

Contracts

PERFORMANCE AND BREACH

Alleged misrepresentations did not justify non-performance of contract

Defendants purchased plaintiff’s real estate brokerage pursuant to share purchase agreement. Defendant guaranteed purchase price by unconditional promissory note. Defendant stopped payments. Plaintiff brought action to enforce promissory note and for non-payment of balance of purchase price. Defendants alleged misrepresentation and breaches of agreement in negotiations and disclosure. Defendants claimed damages. Plaintiff was entitled to payment of $372,514 pursuant to promissory note. Counterclaim was dismissed. No misrepresentations were made to defendants to induce individual to enter into agreement. No reliance was placed on any representations in entering agreement. Only term plaintiff breached was failure to deliver audited financial statements, which was not material and caused defendants no damages because defendants waived them and affirmed contract. Alleged misrepresentations were without foundation and did not justify defendant’s non-performance of contract and did not support claim for damages.
Henderson v. Risi (Feb. 20, 2013, Ont. S.C.J., Lederman J., File No. CV-09-393431) 226 A.C.W.S. (3d) 1172.

Appeal

LEAVE TO APPEAL

Failure to cite correct test for summary judgment sufficient to doubt correctness of decision

This was motion for leave to appeal dismissal of motion for summary judgment. Plaintiffs’ action arose from deaths of two victims in collision following high speed vehicle chase by officers of police service. Plaintiffs alleged that police officers were negligent. They alleged that defendants Ontario, Quebec and Canada were vicariously liable, as employers of police officers and owners of police cruisers. Ontario and Quebec brought motions for summary judgment. Motions were dismissed. Motions judge found that determination of vicarious liability would more appropriately be considered with full evidentiary record. Motions judge held that it could not be concluded that plaintiffs’ position was clearly untenable and that interests of justice required trial. Plaintiffs’ motion to further amend pleadings was granted. Leave to appeal granted. Motions judge applied test for motion to strike out claim instead of test for summary judgment, which put decision in conflict with leading decision of Court of Appeal. Motions judge’s review of evidentiary record was problematic. Decision appeared to be in conflict with case law that required responding party to put best evidentiary foot forward. Failure to cite correct test for summary judgment was sufficient to doubt correctness of decision. Motions judge’s review of evidentiary record was problematic and provided additional reason to doubt correctness of decision. With respect to decision to allow amendment, motions judge’s decision conflicted with decision of Supreme Court of Canada. There was good reason to doubt correctness of decision.
Kassian Estate v. Canada (Attorney General) (Feb. 14, 2013, Ont. S.C.J., Robert N. Beaudoin J., File No. Ottawa 10-47481) Leave to appeal from 222 A.C.W.S. (3d) 906 was allowed.  226 A.C.W.S. (3d) 923.

Taxation

INCOME TAX

Decision letter’s conclusion equivocal and inconsistent with evidence

Application for judicial review of decision of Canada Revenue Agency (CRA). Applicant paid president management bonus of $7.09 million on February 28, 2006. President was informed on March 13, 2006 that corporation was obliged to withhold and remit full amount of tax due on payment of bonus on or before March 15, 2006. Applicant remitted payroll taxes of $2.8 million on account of payment of bonus. CRA assessed corporation $284,805 late remitting penalty. CRA determined that applicant ought to have remitted amount on March 3, 2006, and failure to remit proper amount on this date warranted assessment of penalty. Required withholding was later lowered to $1.5 million and penalty was reduced to $150,748. CRA offset penalty with GST refunds owed to applicant. Applicant’s request for cancellation of penalty under taxpayer relief provisions in s. 220(3.1) of Income Tax Act (Can.), was denied. Application granted. Decision was quashed. Applicant made error in failing to remit payroll taxes by March 3, 2006, but corrected error by payment 11 days later. Decision letter from CRA made no indication why applicant’s correction of error was not quick enough to satisfy director, nor did it state how error could have been remedied any quicker. Applicant would not have known correct and final amount owed on penalty until after deduction was made. Decision letter’s conclusion was equivocal and inconsistent with evidence before director. Director’s decision that applicant failed to quickly remedy error was found to be unreasonable as it failed requirements of being justified, transparent and intelligible. Matter was returned for re-determination.
NRT Technology Corp v. Canada (Attorney General) (Feb. 27, 2013, F.C., Leonard S. Mandamin J., File No. T-56-08) 226 A.C.W.S. (3d) 1204.
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