Canadian Appeals Monitor

Information and Commentary on Upcoming and Recent Appeal Court Decisions

Die Another Day: SCC Adjourns Appeal of National Class Actions Decision Sine Die

Posted in Case Comments, Class Actions, Conflict of Laws, Constitutional
Katherine Booth

Followers of Canadian class actions law will have longer to wait for a decision in the much anticipated appeal from the Manitoba Court of Appeal’s decision in Meeking v. Cash Store Inc. et al., 2013 MBCA 81. The appeal, which was scheduled to be heard on January 12, 2015 and expected to bring clarity on the issue of “national” class actions in Canada, was recently adjourned sine die.

The significance of the Meeking decision is described in two earlier posts, which can be found here and here. In summary, the Manitoba Court of Appeal recognized a new presumptive connecting factor, namely the presence of common issues across the class, by which a provincial superior court could assume jurisdiction over non-residents in class proceedings, with the result that a class settlement entered into in Ontario could be binding on extra-provincial class members. However, the Court went on to deny enforcement against some plaintiffs in that case on procedural fairness grounds, because the notice of settlement was deficient with respect to those plaintiffs’ claims.

Both the representative plaintiff, Scott Meeking, and the defendant, the Cash Store Inc., sought and were granted leave to appeal the decision to the Supreme Court of Canada. Since that time, the Cash Store and related companies have commenced reorganization proceedings in Ontario under the Companies’ Creditors Arrangement Act, RSC 1985, c C-36 and obtained an order staying proceedings against them.

In its decision released August 27, 2014, the Supreme Court of Canada granted the representative plaintiff’s motion to adjourn the appeal hearing sine die until the stay granted in the CCAA proceedings was no longer in effect, or unless leave was granted in the CCAA proceedings lifting the stay for the purpose of hearing the appeal to the Supreme Court. As at the date of this post, no motion seeking to lift the stay appears to have been brought.

Case Information

Meeking v. Cash Store Inc. et al, 2013 MBCA 81

Docket: AI 12-30-07812

Date of Decision: September 15, 2014

The Crucial Distinction Between Carrots and Sticks: Incentives and Penalties in the Interpretation of the Interest Act

Posted in Real Property
Timothy Froese

Do incentives for prompt payment in a mortgage, which would be lost on default, run afoul of the prohibition against penalties for non-performance contained in s.8 of the Interest Act? The Alberta Court of Appeal recently split over this question, with the majority saying no. This case could affect the structure of mortgages in Alberta, encouraging the use of “non-penal” devices to ensure performance that may be difficult to distinguish, in operation, from penalties.

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Ontario Court of Appeal Turns Against Cross-Border Securities Class Actions

Posted in Case Comments, Class Actions, Securities
Michael RosenbergSapna Thakker

The following post on the Canadian Class Actions Monitor blog may be of interest to readers of this blog: Ontario Court of Appeal Turns Against Cross-Border Securities Class Actions.

In the recent decision of Kaynes v. BP, PLC, 2014 ONCA 580, the Ontario Court of Appeal stayed a proposed secondary market securities class action on the basis of forum non conveniens.  Writing for a unanimous Court of Appeal, Sharpe J.A. found that Ontario could assume jurisdiction over claims by Canadian residents who purchased their shares on foreign exchanges.  Nevertheless, he held that Ontario should decline jurisdiction on the basis that foreign courts were better positioned to decide claims arising from transactions on foreign exchanges. Read more

 

Time to Leave: Supreme Court to Determine Securities Class Action Limitation Period

Posted in Case Comments, Class Actions, Securities
Elder MarquesMichael O'Brien

The Supreme Court of Canada has granted leave to appeal in a case that will determine how to apply the statutory limitation period for investors in Ontario who decide to sue public issuers and their executives under the Securities  Act.  Given similar legislation in other provinces, the case will be significant for investors and public issuers across Canada.

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A Costly Choice (of law): Determining the damages available for an extra-territorial tort

Posted in Case Comments, Conflict of Laws
Brooke MacKenzie

The recent UK Supreme Court decision in Cox v Ergo Versicherung AG, [2014] UKSC 22, provides helpful commentary and a potentially persuasive precedent for Canadian courts on issues of choice of law, the distinction between substance and procedure in the conflict of laws, and legislative extraterritoriality in circumstances where a cause of action is governed by a foreign law.

Consistent with Canadian law, the UK Supreme Court held in Cox that issues of substance are governed by the law of the place where the injury was sustained, but issues of procedure must be determined by the law of the forum where the case is tried.

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A blockbuster decision in contractual interpretation

Posted in Case Comments, Contracts
Geoff R. Hall

In the world of contractual interpretation, the decision of the Supreme Court of Canada in Sattva Capital Corp. v. Creston Moly Corp. is a blockbuster. Sattva does three significant things. First, it determines that contractual interpretation generally involves a mixed question of fact and law, not a question of law alone. That holding has major implications for appellate review of decisions involving issues of contractual interpretation, and represents the resolution of an issue that had previously divided provincial appellate courts. Second, Sattva emphasizes the importance to contractual interpretation of evidence of the surrounding circumstances or the factual matrix in which a contract is formed. In doing so, Sattva implicitly overrules a 1998 Supreme Court of Canada precedent to the extent that it had downplayed the importance of the factual matrix. Third, Sattva reaffirms a number of principles of contractual interpretation which are well established in Canadian jurisprudence.

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Pay Me Now: Court of Appeal Delivers Lessons on fiduciary duties, the business judgment rule, and executive compensation

Posted in Case Comments, Corporate Law, Securities
Elder MarquesShane C. D'SouzaRobert Glasgow

The business judgment of directors setting executive compensation was front and centre in the Ontario Court of Appeal’s recent decision in Unique Broadband Systems, Inc. (Re), 2014 ONCA 538 (UBS). Although the decision is based on unique underlying facts, it offers several important lessons on corporate governance.

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Deemed Reliance in the U.S. Supreme Court

Posted in Case Comments, Class Actions, Securities
Eric BlockAndrew MathesonDana PeeblesStephanie Sugar

The following post on the Canadian Securities Regulatory Monitor blog may be of interest to readers of this blog: Deemed Reliance in the U.S. Supreme Court.

On June 23, 2014 the United States Supreme Court issued its much-anticipated decision in Halliburton Co. v. Erica P. John Fund (“Halliburton”), as issuers and investors in the U.S. (and Canada) wanted to see if the landscape for securities class actions in both countries would be fundamentally changed. The U.S. Supreme Court made only an uneventful change in U.S. law and so our Courts are not likely to see a sudden shift of class actions against cross-listed companies to Canada. The U.S. Supreme Court specifically held that defendants in securities class actions could rebut the presumption of investor reliance on public and material misrepresentations prior to class certification, by mounting evidence that the alleged misrepresentations did not, in fact, affect the issuer’s share price.  Read more

Halliburton: Deepening the Divide Between Certification of US and Canadian Securities Class Actions

Posted in Case Comments, Class Actions, Securities
Laurie Baptiste

Everyone has been talking about the recent decision from the US Supreme Court in Halliburton Co v Erica P. John Fund Inc (Halliburton) and its rulings regarding the “fraud on the market” doctrine in US securities class action litigation (previously reported on here and here). In Canada, many are likely wondering about the potential impact of the decision here.  However, what this case shows is a deepening divide between the certification process of such actions in the US and Canada. In the US, the process is becoming more difficult for investors, while Canada remains a very pro-certification jurisdiction.

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US Supreme Court Clarifies Law on Warrantless Cell Phone Searches. Will the Supreme Court of Canada Follow?

Posted in Case Comments, Charter of Rights, Criminal
Marlon Hylton

Lower courts in both Canada and the US have been deeply divided on the application of their respective Supreme Courts’ precedents on whether the police need a warrant to search the contents of a smart/cell phone seized during a lawful arrest.  On June 25, 2014, the US Supreme Court unanimously settled US law in Riley v. California, No. 13-132.  The court found that privacy interests at stake outweigh any legitimate governmental interest, absent any “exigent circumstances”.

The Fourth Amendment of the US Constitution provides protection against unreasonable search.  A common law exception to the protection under the Amendment is where the search is incident to a lawful arrest.

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Grassy Narrows First Nation v. Ontario (Natural Resources) – SCC affirms Ontario’s taking up of treaty lands for resource development purposes

Posted in Aboriginal, Mining

The following Mining Prospects blog post by Sam Adkins and Stephanie Axmann may be of interest to our readers:

Grassy Narrows First Nation v. Ontario (Natural Resources) – SCC affirms Ontario’s taking up of treaty lands for resource development purposes

 

Nine Years Too Late, Wal-Mart’s First Unionized Employees Win at the Highest Court

Posted in Labour and Employment
Elder Marques

The saga of North America’s first unionized Wal-Mart has taken a significant turn in favour of its former employees, nine years after they lost their jobs when the store in Jonquière, Quebec was permanently shut.  Much ink has been spilled telling the story of the Jonquière store, its successful unionization in 2004, and its closure in 2005, which was announced on the very day that an arbitrator had been appointed in relation to the what was to have been the store’s first collective agreement.  Now, the Supreme Court of Canada in United Food and Commercial Workers, Local 503 v. Wal-Mart Canada Corp., 2014 SCC 45  has, for a second time, considered the rights of the store’s employees in the context of that store closure.  This time, however, the Court issued a significant victory in favour of the employees which may have implications across the country.

In 2009, the Court dismissed a pair of appeals – Plourde 2009 SCC 54  and Desbiens 2009 SCC 55 – in which former employees sought remedies after the store closure.  On June 27, 2014, the Court released the decision of a seven-member panel’s consideration of a grievance claiming that Wal-Mart’s closure of the store violated the “freeze” provisions of Quebec’s Labour Code.  Similar to provisions elsewhere, the s. 59 “freeze” restricts the employer’s ability to “change the conditions of employment of his employees” during certain phases of collective bargaining.  In a 5-2 ruling, the Court upheld an arbitrator’s award which had found that the closure of the store constituted an impermissible change in the employees’ employment conditions in the absence of evidence that the closure was made in the ordinary course of the company’s business. Continue Reading

Summary Judgment on Trial: Ontario Court of Appeal Revisits the Risks of Summary Adjudication

Posted in Case Comments, Procedure
Katherine Booth

In a recent decision, Baywood Homes Partnership v. Haditaghi, 2014 ONCA 450, the Ontario Court of Appeal reiterates some of the risks of summary adjudication and reminds parties that, despite the enthusiasm for summary judgment endorsed by the Supreme Court of Canada in Hryniak v. Mauldin, 2014 SCC 7, summary judgment may not be appropriate in all cases – specifically, those in which a staged fact-finding process raises the spectre of inconsistent findings at summary judgment and at trial.

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This Week at the SCC (27/06/14)

A Commentary on Recent Legal Developments by the Opinions Group of McCarthy Tétrault LLP

Posted in This Week at the SCC
Anthony Alexander

This has been a particularly busy week at the Supreme Court of Canada vis-à-vis cases likely to be of interest to Canadian businesses and professionals.  The Court issued two significant rulings, and refused leave to appeal in another seven cases.

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The Aereo Decision – Canadian Content?

Posted in Case Comments, Intellectual Property
Daniel G.C. Glover

The following post on the snIP/ITs blog may be of interest to readers of this blog: The Aereo Decision – Canadian Content?

On June 25, 2014, the United States Supreme Court ruled in a 6-3 decision in American Broadcasting Cos., Inc. et al v. Aereo, Inc. that Aereo’s Internet retransmission service infringes copyright. McCarthy Tétrault played a small role by filing an amicus brief on behalf of a coalition of international rights holders and copyright scholars that drew the Court’s attention to the need to interpret the US Copyright Act in a technologically neutral way, as similar copyright laws have been construed by the Supreme Court of Canada and the European Court of Justice to conform to international copyright treaty law. Read more

 

 

 

Too Soon to Say Too Late? Reviewing a Tribunal’s decision to hear a late-filed complaint

Posted in Administrative, Case Comments
Ryann Atkins

This month the British Columbia Court of Appeal provided guidance on two administrative law questions, one procedural and one substantive. The Court weighed in on when it is appropriate to review a preliminary decision of a tribunal before the hearing on the merits, and confirmed that where the tribunal decides to hear a late-filed complaint, it is not open to the reviewing judge to reweigh the evidence. In Mzite v. British Columbia (Ministry of Public Safety and Solicitor General), the Court of Appeal upheld the decision of the lower court judge to review the Human Rights Tribunal’s decision to accept a late-filed complaint in the public interest, but overturned his order to set the Tribunal’s decision aside.

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A Supreme Cabinet of Appeal for Economic Tribunals?

Posted in Administrative, Case Comments, Transportation
Dina Awad

The Supreme Court of Canada has released a much anticipated administrative law decision interpreting the scope of Cabinet’s powers to overrule tribunals. In Canadian National Railway Co. v. Canada (Attorney General), the Supreme Court clarified that reasonableness review applies to Ministerial decisions made pursuant to a “cluster” of economic regulatory statutes, including the Canada Transportation Act, S.C. 1996, c. 10. These economic statutes empower the Governor in Council to vary or rescind decisions of the tribunals administering the legislation, requiring reviewing courts to employ deference even on issues of law.

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Class, Do Your Homework: Causation and Damages Methodologies at Certification

Posted in Case Comments, Class Actions, Corporate Law, Procedure, Torts
Justin Nasseri

Overview

In Andriuk v. Merrill Lynch Canada Inc., the Alberta Court of Appeal affirmed a certification judge’s decision that an action, commenced pursuant to Alberta’s Class Proceedings Act, did not meet the requirements for certification of a class proceeding, based on a failure to demonstrate a viable methodology for establishing causation and damages on a class-wide basis.

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This Week at the SCC (13/06/14)

A Commentary on Recent Legal Developments by the Opinions Group of McCarthy Tétrault LLP

Posted in This Week at the SCC
Hovsep Afarian

This week, the Supreme Court of Canada issued two rulings, granted two leave to appeal applications, and dismissed three applications for leave to appeal, in cases likely to be of interest to Canadian businesses and professionals.

In R. v. Spencer, 2014 SCC 43, the Supreme Court of Canada ruled that the police engaged in an unconstitutional search and seizure when they obtained from an Internet service provider — without prior judicial authorization — the subscriber information associated with an IP address.

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The Second Opinion: “Stinky” but not “Fundamental” — The BCCA sets a High Hurdle for Repudiation of a Lease

A Commentary on Recent Legal Developments by the Opinions Group of McCarthy Tétrault LLP

Posted in The Second Opinion
Anthony Alexander

The contractual doctrine of “fundamental breach” is both doctrinally complex and highly contextual.  In Stearman v. Powers, 2013 BCCA 206, the Court concluded that, on the facts before it, a commercial tenant had not been justified in repudiating her lease and walking away from the premises, despite the fact that the building’s HVAC system filled her store with a foul odour.

While the case ultimately turned on its unique facts, the Court in Stearman provides useful guidance regarding the threshold for categorizing a problem with rented premises as a “fundamental breach” of contract, as well as the scope of a tenant’s right of “quiet enjoyment.”

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Simpler is Better: Third Party Claims Struck for Efficiency and Proportionality in Recent Court of Appeal Decision

Posted in Case Comments, Procedure, Torts
Carole Piovesan

The “culture shift” to a more accessible civil justice system, as championed in Hryniak v. Mauldin, is alive and well. Courts are increasingly sensitive to the economy of cases, taking into account the efficiency and proportionality of substantive and procedural rights. Today’s emphasis is on reasonable not exhaustive measures.

In O’Connor Associates Environmental Inc. v. MEC OP LLC, the Alberta Court of Appeal overturned the decision of a case management judge who permitted the joinder of third party advisors to a main action between a purchaser and vendor of oil and gas assets. This appellate decision incorporates the Hryniak policy rationale of more efficient judicial processes in its decision strike out all claims against the third parties.

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This Week at the SCC (06/06/2014)

A Commentary on Recent Legal Developments by the Opinions Group of McCarthy Tétrault LLP

Posted in This Week at the SCC
Martin Boodman

The Supreme Court of Canada denied leave to appeal this week from one appeal of interest to Canadian businesses and professions.

The decision in Amtim Capital Inc. v. Appliance Recycling Centers of America  (2014 ONCA 62) indicates that pre-emptive declaratory relief in one jurisdiction may not be effective to prevent subsequent litigation elsewhere.

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There are times when you don’t want to make partner…

Posted in Case Comments, Labour and Employment, Professions
Curtis E. Marble

Overview

Recently, the Supreme Court of Canada (“SCC”) and the Supreme Court of the United Kingdom (“UKSC”) both had cause to consider the nature of partnership, and when certain protections due to employees or workers are extended to partners. While the two cases presented very different scenarios – the Canadian case concerning human rights, and the UK decision concerning employment rights – both decisions suggested that partners may indeed be employees in certain situations.

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The Importance of Borders in a Borderless World: Ontario Court Stays Action for U.S. Transportation Taxes

Posted in Case Comments, Class Actions, Conflict of Laws, Tax
Byron Shaw

In Prince v. ACE Aviation Holdings Inc., the Ontario Court of Appeal stayed a class action based on allegations that Air Canada had improperly collected transportation taxes levied under the U.S. Internal Revenue Code (the “Code”). The Court’s decision highlights the difficulty in predicting the outcome of jurisdictional disputes involving e-commerce transactions. In addition, it illustrates the reluctance of our courts to permit class actions based on claims that engage the territorial sovereignty of other nations.

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